ALEXANDER & ▇▇▇▇▇▇▇, INC.
$75,000,000
PRIVATE SHELF AGREEMENT
November 25, 2003
TABLE OF CONTENTS
SECTION PAGE NO.
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1. AUTHORIZATION OF ISSUE OF NOTES.........................1
2A. Intentionally Omitted...................................2
2B. Purchase and Sale of Notes..............................2
2B(1). Facility.....................................2
2B(2). Issuance Period..............................2
2B(3). Request for Purchase.........................2
2B(4). Rate Quotes..................................3
2B(5). Acceptance...................................3
2B(6). Market Disruption............................3
2B(7). Facility Closings............................4
2B(8). Fees.........................................4
2B(8)(i). Structuring Fee..............4
2B(8)(ii). Issuance Fee.................5
2B(8)(iii). Delayed Delivery Fee.........5
2B(8)(iv). Cancellation Fee.............5
3. CONDITIONS OF CLOSING...................................6
3A. Certain Documents.......................................6
3B. Representations and Warranties; No Default..............7
3C. Purchase Permitted by Applicable Laws...................7
3D. Payment of Fees.........................................7
4. PREPAYMENTS.............................................7
4A. Required Prepayments of Notes...........................7
4B. Optional Prepayment with Yield-Maintenance Amount.......7
4C. Notice of Optional Prepayment...........................8
4D. Application of Prepayments 8
4E. Retirement of Notes.....................................8
5. AFFIRMATIVE COVENANTS...................................8
5A. Financial Statements....................................9
5B. Inspection of Property ............................10
5C. Covenant to Secure Notes Equally.......................10
5D. Information Required by Rule 144A......................10
5E. Maintenance of Properties; Insurance...................11
5F. Environmental and Safety Laws..........................11
6. NEGATIVE COVENANTS.....................................11
6A. Financial Covenants....................................11
6A(1). Minimum Net Worth...........................11
6A(2). Debt to EBITDA Ratio........................12
6A(3). Interest Coverage Ratio.....................12
6B. Lien and Other Restrictions............................12
6B(1). Liens ............................12
6B(2). Loans and Advances..........................13
6B(3). Merger and Sale of Assets...................13
6B(4). Priority Debt ............................14
6B(5). Sale or Discount of Receivables.............14
6B(6). Sale-Leasebacks.............................15
6B(7). Transactions with Holders of Partnership
or Other Equity Interests...................15
6B(8). Transfer of Assets to Subsidiaries..........15
6B(9). Sale of Stock and Debt of Subsidiaries......15
6C. Restricted Payments....................................16
7. EVENTS OF DEFAULT......................................16
7A. Acceleration...........................................16
7B. Rescission of Acceleration.............................19
7C. Notice of Acceleration or Rescission...................19
7D. Other Remedies.........................................19
8. REPRESENTATIONS, COVENANTS AND WARRANTIES..............20
8A. Organization ............................20
8B. Financial Statements...................................20
8C. Actions Pending........................................21
8D. Outstanding Debt.......................................21
8E. Title to Properties....................................21
8F. Taxes..................................................21
8G. Conflicting Agreements and Other Matters...............21
8H. Offering of the Notes..................................22
8I. Regulation U, etc......................................22
8J. ERISA..................................................22
8K. Governmental Consent...................................23
8L. Utility Company Status.................................23
8M. Investment Company Status..............................23
8N. Bank Holding Company Status............................23
8O. Real Property Matters..................................23
8P. Possession of Franchises, Licenses, etc................23
8Q. Environmental and Safety Matters.......................24
8R. Hostile Tender Offers..................................24
8S. Employee Relations.....................................24
8T. Regulations and Legislation............................24
8U. Disclosure.............................................24
9. REPRESENTATION OF THE PURCHASERS.......................24
9A. Nature of Purchase.....................................24
9B. Source of Funds........................................25
10. DEFINITIONS; ACCOUNTING MATTERS........................26
10A. Yield Maintenance Terms................................26
10B. Other Terms............................................28
10C. Accounting Principles, Terms and Determinations........37
11. MISCELLANEOUS..........................................38
11A. Note Payments..........................................38
11B. Expenses...............................................38
11C. Consent to Amendments..................................38
11D. Form; Registration, Transfer and Exchange of Notes;
Transfer Restriction...................................39
11E. Persons Deemed Owners, Participations..................40
11F. Survival of Representations and Warranties;
Entire Agreement.......................................40
11G. Successors and Assigns.................................41
11H. Independence of Covenants..............................41
11I. Notices................................................41
11J. Descriptive Headings...................................41
11K. Satisfaction Requirement...............................42
11L. Governing Law..........................................42
11M. Change in Accounting Principles........................42
11N. Payments Due on Non-Business Days......................42
11O. Severability...........................................42
11P. Severalty of Obligations...............................42
11Q. Counterparts...........................................42
11R. Binding Agreement......................................42
Schedules and Exhibits
Information Schedule
Exhibit A -- Form of Note
Exhibit B -- Form of Request for Purchase
Exhibit C -- Form of Confirmation of Acceptance
Exhibit D -- Form of Opinion of Companies' Special Counsel
Schedule 5A -- Independent Auditors' Report
Schedule 6B(1) -- Liens
Schedule 8G -- Agreements Restricting Debt
ALEXANDER & ▇▇▇▇▇▇▇, INC.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
As of November 25, 2003
Prudential Investment Management, Inc. ("Prudential")
Each Prudential Affiliate(as hereinafter
defined) which becomes bound by certain
provisions of this Agreement as hereinafter
provided (together with Prudential,
the "Purchasers")
c/o Prudential Capital Group
Four ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
The undersigned, Alexander & ▇▇▇▇▇▇▇, Inc. (the "Company") hereby
agrees with you as follows:
1. AUTHORIZATION OF ISSUE OF NOTES. The Company has authorized the
issue of its senior promissory notes in the aggregate principal amount of
$75,000,000, to be dated the date of issue thereof, to mature, in the case of
each Note so issued, no more than twenty years from the date of original
issuance, to have an average life, in the case of each Note so issued, of no
more than fifteen years, to bear interest on the unpaid balance thereof from the
date thereof at the rate per annum, and to have such other particular terms, as
shall be set forth, in the case of each Note so issued, in the Confirmation of
Acceptance with respect to such Note delivered pursuant to paragraph 2B(5), and
to be substantially in the form of Exhibit A attached hereto. The terms "Note"
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and "Notes" as used herein shall include each Note delivered pursuant to any
provision of this Agreement and each Note delivered in substitution or exchange
for any such Note pursuant to any such provision. Notes which have (i) the same
final maturity, (ii) the same principal prepayment dates, (iii) the same
principal prepayment amounts (as a percentage of the original principal amount
of each Note), (iv) the same interest rate, (v) the same interest payment
periods and (vi) the same date of issuance (which, in the case of a Note issued
in exchange for another Note, shall be deemed for these purposes the date on
which such Note's ultimate predecessor Note was issued), are herein called a
"Series" of Notes.
2A. Intentionally Omitted.
2B. PURCHASE AND SALE OF NOTES.
2B(1). Facility. Prudential is willing to consider, in its sole
discretion and within limits which may be authorized for purchase by Prudential
and Prudential Affiliates from time to time, the purchase of Notes pursuant to
this Agreement. The willingness of Prudential to consider such purchase of Notes
is herein called the "Facility". At any time, the aggregate principal amount of
Notes stated in paragraph 1, minus the aggregate principal amount of Notes
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purchased and sold pursuant to this Agreement prior to such time, minus the
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aggregate principal amount of Accepted Notes (as hereinafter defined) which have
not yet been purchased and sold hereunder prior to such time, is herein called
the "Available Facility Amount" at such time. NOTWITHSTANDING THE WILLINGNESS OF
PRUDENTIAL TO CONSIDER PURCHASES OF NOTES, THIS AGREEMENT IS ENTERED INTO ON THE
EXPRESS UNDERSTANDING THAT NEITHER PRUDENTIAL NOR ANY PRUDENTIAL AFFILIATE SHALL
BE OBLIGATED TO MAKE OR ACCEPT OFFERS TO PURCHASE NOTES, OR TO QUOTE RATES,
SPREADS OR OTHER TERMS WITH RESPECT TO SPECIFIC PURCHASES OF NOTES, AND THE
FACILITY SHALL IN NO WAY BE CONSTRUED AS A COMMITMENT BY PRUDENTIAL OR ANY
PRUDENTIAL AFFILIATE.
2B(2). Issuance Period. Notes may be issued and sold pursuant to this
Agreement until the earlier of (i) the third anniversary of the date of this
Agreement (or if such anniversary is not a Business Day, the Business Day next
preceding such anniversary) and (ii) the thirtieth day after Prudential shall
have given to a Company, or a Company shall have given to Prudential, a written
notice stating that it elects to terminate the issuance and sale of Notes
pursuant to this Agreement (or if such thirtieth day is not a Business Day, the
Business Day next preceding such thirtieth day). The period during which Notes
may be issued and sold pursuant to this Agreement is herein called the "Issuance
Period".
2B(3). Request for Purchase. The Company may from time to time during
the Issuance Period make requests for purchases of Notes (each such request
being herein called a "Request for Purchase"). Each Request for Purchase shall
be made to Prudential by telefacsimile or overnight delivery service, and shall
(i) specify the aggregate principal amount of Notes covered thereby, which shall
not be less than $5,000,000 and not be greater than the Available Facility
Amount at the time such Request for Purchase is made, (ii) specify the principal
amounts, final maturities, principal prepayment dates and amounts and interest
payment periods (quarterly or semiannual in arrears) of the Notes covered
thereby, (iii) specify the use of proceeds of such Notes, (iv) specify the
proposed day for the closing of the purchase and sale of such Notes, which shall
be a Business Day during the Issuance Period not less than 5 Business Days and
not more than 30 Business Days after the making of such Request for Purchase,
(v) specify the number of the account and the name and address of the depository
institution to which the purchase price of such Notes is to be transferred on
the Closing Day for such purchase and sale, (vi) certify that the
representations and warranties contained in paragraph 8 are true on and as of
the date of such Request for Purchase and that there exists on the date of such
Request for Purchase no Event of Default or Default, (vii) specify the
Designated Spread for such Notes and (viii) be substantially in the form of
Exhibit B attached hereto. Each Request for Purchase shall be in writing and
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shall be deemed made when received by Prudential.
2B(4). Rate Quotes. Not later than five Business Days after the Company
shall have given Prudential a Request for Purchase pursuant to paragraph 2B(3),
Prudential may, but shall be under no obligation to, provide to the Company by
telephone or telefacsimile, in each case between 9:30 A.M. and 2:00 P.M. New
York City local time (or such later time as Prudential may elect) interest rate
quotes for the several principal amounts, maturities, principal prepayment
schedules, and interest payment periods of Notes specified in such Request for
Purchase. Each quote shall represent the interest rate per annum payable on the
outstanding principal balance of such Notes at which Prudential or a Prudential
Affiliate would be willing to purchase such Notes at 100% of the principal
amount thereof.
2B(5). Acceptance. Within five minutes after Prudential shall have
provided any interest rate quotes pursuant to paragraph 2B(4), or such shorter
period as Prudential may specify to the Company (such period herein called the
"Acceptance Window"), the Company may, subject to paragraph 2B(6), elect to
accept such interest rate quotes as to not less than $5,000,000 aggregate
principal amount of the Notes specified in the related Request for Purchase.
Such election shall be made by an Authorized Officer of the Company notifying
Prudential by telephone or telefacsimile within the Acceptance Window that the
Company elects to accept such interest rate quotes, specifying the Notes (each
such Note being herein called an "Accepted Note") as to which such acceptance
(herein called an "Acceptance") relates. The day the Company notifies an
Acceptance with respect to any Accepted Notes is herein called the "Acceptance
Day" for such Accepted Notes. Any interest rate quotes as to which Prudential
does not receive an Acceptance within the Acceptance Window shall expire, and no
purchase or sale of Notes hereunder shall be made based on such expired interest
rate quotes. Subject to paragraph 2B(6) and the other terms and conditions
hereof, the Company agrees to sell to Prudential or a Prudential Affiliate, and
Prudential agrees to purchase, or to cause the purchase by a Prudential
Affiliate of, the Accepted Notes at 100% of the principal amount of such Notes.
As soon as practicable following the Acceptance Day, the Company, Prudential and
each Prudential Affiliate which is to purchase any such Accepted Notes will
execute a confirmation of such Acceptance substantially in the form of Exhibit C
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attached hereto (herein called a "Confirmation of Acceptance"). If the Company
should fail to execute and return to Prudential within three Business Days
following receipt thereof a Confirmation of Acceptance with respect to any
Accepted Notes, Prudential may at its election at any time prior to its receipt
thereof cancel the closing with respect to such Accepted Notes by so notifying
the Company in writing.
2B(6). Market Disruption. Notwithstanding the provisions of paragraph
2B(5), if Prudential shall have provided interest rate quotes pursuant to
paragraph 2B(4) and thereafter prior to the time an Acceptance with respect to
such quotes shall have been notified to Prudential in accordance with paragraph
2B(5) the domestic market for U.S. Treasury securities or derivatives shall have
closed or there shall have occurred a general suspension, material limitation,
or significant disruption of trading in securities generally on the New York
Stock Exchange or in the domestic market for U.S. Treasury securities or
derivatives, then such interest rate quotes shall expire, and no purchase or
sale of Notes hereunder shall be made based on such expired interest rate
quotes. If the Company thereafter notifies Prudential of the Acceptance of any
such interest rate quotes, such Acceptance shall be ineffective for all purposes
of this Agreement, and Prudential shall promptly notify the Company that the
provisions of this paragraph 2B(6) are applicable with respect to such
Acceptance.
2B(7). Facility Closings. Not later than 1:30 P.M. (New York City local
time) on the Closing Day for any Accepted Notes, the Company will deliver to
each Purchaser listed in the Confirmation of Acceptance relating thereto at the
offices of Prudential Capital Group the Accepted Notes to be purchased by such
Purchaser in the form of one or more Notes in authorized denominations as such
Purchaser may request for each Series of Accepted Notes to be purchased on the
Closing Day, dated the Closing Day and registered in such Purchaser's name (or
in the name of its nominee), against payment of the purchase price thereof by
transfer of immediately available funds for credit to the account specified by
the Company in the Request for Purchase of such Notes. If the Company fails to
tender to any Purchaser the Accepted Notes to be purchased by such Purchaser on
the scheduled Closing Day for such Accepted Notes as provided above in this
paragraph 2B(7), or any of the conditions specified in paragraph 3 shall not
have been fulfilled by the time required on such scheduled Closing Day, the
Company shall, prior to 2:30 P.M., New York City local time, on such scheduled
Closing Day notify Prudential (which notification shall be deemed received by
each Purchaser) in writing whether (i) such closing is to be rescheduled (such
rescheduled date to be a Business Day during the Issuance Period not less than
one Business Day and not more than 10 Business Days after such scheduled Closing
Day (the "Rescheduled Closing Day") and certify to Prudential (which
certification shall be for the benefit of each Purchaser) that the Company
reasonably believes that it will be able to comply with the conditions set forth
in paragraph 3 on such Rescheduled Closing Day and that the Company will pay the
Delayed Delivery Fee in accordance with paragraph 2B(8)(iii) or (ii) such
closing is to be canceled. In the event that the Company shall fail to give such
notice referred to in the preceding sentence, Prudential (on behalf of each
Purchaser) may at its election, at any time after 2:30 P.M., New York City local
time, on such scheduled Closing Day, notify the Company in writing that such
closing is to be canceled. Notwithstanding anything to the contrary appearing in
this Agreement, the Company may not elect to reschedule a closing with respect
to any given Accepted Notes on more than one occasion, unless Prudential shall
have otherwise consented in writing.
2B(8). Fees.
2B(8)(i). Structuring Fee. In consideration for the time, effort and
expense involved in the preparation, negotiation and execution of this
Agreement, at the time of the execution and delivery of this Agreement by the
Company and Prudential, the Company shall pay to Prudential in immediately
available funds the $37,500 unpaid balance of a fee (herein called the
"Structuring Fee") in the aggregate amount of $112,500; provided that if at
least $15,000,000 of Notes are issued concurrently with the execution and
delivery of this Agreement the Structuring Fee shall be $75,000.
2B(8)(ii). Issuance Fee. The Company agrees to pay to each Purchaser in
immediately available funds a fee (herein called the "Issuance Fee") on each
Closing Day in an amount equal to 0.10% of the aggregate principal amount of
Notes sold to such Purchaser on such Closing Day.
2B(8)(iii). Delayed Delivery Fee. If the closing of the purchase and
sale of any Accepted Note is delayed for any reason beyond the original Closing
Day for such Accepted Note, the Company agrees to pay to Prudential (a) on the
Cancellation Date or actual closing date of such purchase and sale and (b) if
earlier, the next Business Day following 90 days after the Acceptance Day for
such Accepted Note and on each Business Day following 90 days after the prior
payment hereunder, a fee (herein called the "Delayed Delivery Fee") calculated
as follows:
(BEY - MMY) X DTS/360 X PA
where "BEY" means Bond Equivalent Yield, i.e., the bond equivalent yield per
annum of such Accepted Note, "MMY" means Money Market Yield, i.e., the yield per
annum on a commercial paper investment of the highest quality selected by
Prudential on the date Prudential receives notice of the delay in the closing
for such Accepted Note having a maturity date or dates the same as, or closest
to, the Rescheduled Closing Day or Rescheduled Closing Days (a new alternative
investment being selected by Prudential each time such closing is delayed);
"DTS" means Days to Settlement, i.e., the number of actual days elapsed from and
including the original Closing Day with respect to such Accepted Note (in the
case of the first such payment with respect to such Accepted Note) or from and
including the date of the next preceding payment (in the case of any subsequent
delayed delivery fee payment with respect to such Accepted Note) to but
excluding the date of such payment; and "PA" means Principal Amount, i.e., the
principal amount of the Accepted Note for which such calculation is being made.
In no case shall the Delayed Delivery Fee be less than zero. Nothing contained
herein shall obligate any Purchaser to purchase any Accepted Note on any day
other than the Closing Day for such Accepted Note, as the same may be
rescheduled from time to time in compliance with paragraph 2B(7).
2B(8)(iv). Cancellation Fee. If the Company at any time notifies
Prudential in writing that the Company is canceling the closing of the purchase
and sale of any Accepted Note, or if Prudential notifies the Company in writing
under the circumstances set forth in the last sentence of paragraph 2B(5) or the
penultimate sentence of paragraph 2B(7) that the closing of the purchase and
sale of such Accepted Note is to be canceled, or if the closing of the purchase
and sale of such Accepted Note is not consummated on or prior to the last day of
the Issuance Period (the date of any such notification, or the last day of the
Issuance Period, as the case may be, being herein called the "Cancellation
Date"), the Company agrees to pay to Prudential in immediately available funds
an amount (the "Cancellation Fee") calculated as follows:
PI X PA
where "PI" means Price Increase, i.e., the quotient (expressed in decimals)
obtained by dividing (a) the excess of the ask price (as determined by
Prudential) of the Hedge Treasury Note(s) on the Cancellation Date over the bid
price (as determined by Prudential) of the Hedge Treasury Notes(s) on the
Acceptance Day for such Accepted Note by (b) such bid price; and "PA" has the
meaning ascribed to it in paragraph 2B(8)(iii). The foregoing bid and ask prices
shall be as reported by such publicly available source of such market data as is
then customarily utilized by Prudential. Each price shall be based on a U.S.
Treasury security having a par value of $100.00 and shall be rounded to the
second decimal place. In no case shall the Cancellation Fee be less than zero.
3. CONDITIONS OF CLOSING. On or before the date on which this Agreement
is executed and delivered the Company shall (a) pay to Prudential the balance
(if any) of the Structuring Fee referenced in paragraph 2B(8)(i) and (b) deliver
to Prudential a document in form and content satisfactory to Prudential pursuant
to which it is acknowledged that no new notes issuances shall be made under the
Private Shelf Agreement dated as of April 25, 2001. The obligation of any
Purchaser to purchase and pay for any Notes is subject to the satisfaction, on
or before the Closing Day for such Notes, of the following conditions:
3A. Certain Documents. Such Purchaser shall have received the
following, each dated the date of the applicable Closing Day:
(i) The Note(s) to be purchased by such Purchaser.
(ii) Certified copies of the resolutions of the Board of
Directors of the Company authorizing the execution and delivery of this
Agreement and the issuance of the Notes, and of all documents
evidencing other necessary corporate action and governmental approvals,
if any, with respect to this Agreement and the Notes.
(iii) A certificate of the Secretary or an Assistant Secretary
and one other officer of the Company certifying the names and true
signatures of the officers of the Company authorized to sign this
Agreement and the Notes and the other documents to be delivered
hereunder.
(iv) Certified copies of the Certificate of Incorporation and
By-laws of the Company.
(v) A favorable opinion of Cades ▇▇▇▇▇▇▇ A Limited Liability
Law Partnership LLP, special counsel to the Company (or such other
counsel designated by the Company and acceptable to the Purchaser(s))
satisfactory to such Purchaser and substantially in the form of Exhibit
D attached hereto and as to such other matters as such Purchaser may
reasonably request. The Company hereby directs such counsel to deliver
such opinion, agrees that the issuance and sale of any Notes will
constitute a reconfirmation of such direction, and understands and
agrees that each Purchaser receiving such an opinion will and is hereby
authorized to rely on such opinion.
(vi) A good standing certificate for the Company from the
secretary of state of Hawaii and, if different, from the Company's
jurisdiction of incorporation, in each case dated as of a recent date
and such other evidence of the status of the Company as such Purchaser
may reasonably request.
(vii) Additional documents or certificates with respect to
legal matters or corporate or other proceedings related to the
transactions contemplated hereby as may be reasonably requested by such
Purchaser.
3B. Representations and Warranties; No Default. The representations and
warranties contained in paragraph 8 shall be true on and as of such Closing Day,
except to the extent of changes caused by the transactions herein contemplated;
there shall exist on such Closing Day no Event of Default or Default; and the
Company shall have delivered to such Purchaser an Officer's Certificate, dated
such Closing Day, to both such effects.
3C. Purchase Permitted by Applicable Laws. The purchase of and payment
for the Notes to be purchased by such Purchaser on the terms and conditions
herein provided (including the use of the proceeds of such Notes by the Company)
shall not violate any applicable law or governmental regulation (including,
without limitation, Section 5 of the Securities Act or Regulation T, U or X of
the Board of Governors of the Federal Reserve System) and shall not subject such
Purchaser to any tax, penalty, liability or other onerous condition under or
pursuant to any applicable law or governmental regulation, and such Purchaser
shall have received such certificates or other evidence as it may request to
establish compliance with this condition. This paragraph 3C is a closing
condition and shall not be construed as a tax indemnity.
3D. Payment of Fees. The Company shall have paid to Prudential and any
other Purchaser any fees due it pursuant to or in connection with this
Agreement, including the Structuring Fee due pursuant to paragraph 2B(8)(i), any
Issuance Fee due pursuant to paragraph 2B(8)(ii) and any Delayed Delivery Fee
due pursuant to paragraph 2B(8)(iii).
4. PREPAYMENTS. The Notes shall be subject to required prepayment as
and to the extent provided in paragraph 4A. The Notes shall also be subject to
prepayment under the circumstances set forth in paragraph 4B. Any prepayment
made by the Company pursuant to any other provision of this paragraph 4 shall
not reduce or otherwise affect their obligation to make any required prepayment
as specified in paragraph 4A.
4A. Required Prepayments of Notes. Each Series of Notes shall be
subject to required prepayments, if any, set forth in the Notes of such Series.
4B. Optional Prepayment With Yield-Maintenance Amount. The Notes of
each Series shall be subject to prepayment, in whole at any time or from time to
time in part (in integral multiples of $100,000 and in a minimum amount of
$1,000,000), at the option of the Company, at 100% of the principal amount so
prepaid plus interest thereon to the prepayment date and the Yield-Maintenance
Amount, if any, with respect to each such Note. Any partial prepayment of a
Series of the Notes pursuant to this paragraph 4B shall be applied in
satisfaction of required payments of principal in inverse order of their
scheduled due dates.
4C. Notice of Optional Prepayment. The Company shall give the holder of
each Note of a Series to be prepaid pursuant to paragraph 4B irrevocable written
notice of such prepayment not less than 10 Business Days prior to the prepayment
date, specifying such prepayment date, the aggregate principal amount of the
Notes of such Series to be prepaid on such date, the principal amount of the
Notes of such Series held by such holder to be prepaid on that date and that
such prepayment is to be made pursuant to paragraph 4B. Notice of prepayment
having been given as aforesaid, the principal amount of the Notes specified in
such notice, together with interest thereon to the prepayment date and together
with the Yield-Maintenance Amount, if any, herein provided, shall become due and
payable on such prepayment date. The Company shall, on or before the day on
which it gives written notice of any prepayment pursuant to paragraph 4B, give
telephonic notice of the principal amount of the Notes to be prepaid and the
prepayment date to each Significant Holder which shall have designated a
recipient for such notices in the purchaser schedule attached to the applicable
Confirmation of Acceptance or by notice in writing to the Company.
4D. Application of Prepayments. In the case of each prepayment of less
than the entire unpaid principal amount of all outstanding Notes of any Series
pursuant to paragraph 4A or 4B, the amount to be prepaid shall be applied pro
rata to all outstanding Notes of such Series (including, for the purpose of this
paragraph 4D only, all Notes prepaid or otherwise retired or purchased or
otherwise acquired by the Company or any of its Subsidiaries or Affiliates other
than by prepayment pursuant to paragraph 4A or 4B) according to the respective
unpaid principal amounts thereof.
4E. Retirement of Notes. The Company shall not, and shall not permit
any of its Subsidiaries or Affiliates to, prepay or otherwise retire in whole or
in part prior to their stated final maturity (other than by prepayment pursuant
to paragraphs 4A or 4B, or upon acceleration of such final maturity pursuant to
paragraph 7A), or purchase or otherwise acquire, directly or indirectly, Notes
of any Series held by any holder unless the Company or such Subsidiary or
Affiliate shall have offered to prepay or otherwise retire or purchase or
otherwise acquire, as the case may be, the same proportion of the aggregate
principal amount of Notes of such Series held by each other holder of Notes of
such Series at the time outstanding upon the same terms and conditions. Any
Notes so prepaid or otherwise retired or purchased or otherwise acquired by the
Company or any of its Subsidiaries or Affiliates shall not be deemed to be
outstanding for any purpose under this Agreement, except as provided in
paragraph 4D.
5. AFFIRMATIVE COVENANTS. During the Issuance Period and so long
thereafter as any Note is outstanding and unpaid, the Company covenants as
follows:
5A. Financial Statements. The Company covenants that it will deliver
to each holder of the Notes in duplicate:
(i) as soon as practicable and in any event within the earlier
to occur of 60 days after the end of each quarterly period (other than
the last quarterly period) in each fiscal year or the date on which
another creditor of the Company first receives such information,
consolidated statements of income and cash flows of the Company and its
Subsidiaries for the period from the beginning of the current fiscal
year to the end of such quarterly period, and a consolidated balance
sheet of the Company and its Subsidiaries as at the end of such
quarterly period, setting forth in each case in comparative form
figures for the corresponding period in the preceding fiscal year, all
in reasonable detail and certified by an authorized financial officer
of the Company, subject only to changes resulting from year-end
adjustments;
(ii) as soon as practicable and in any event within the
earlier to occur of 120 days after the end of each fiscal year or the
date on which another creditor of the Company first receives such
information, consolidated statements of income and cash flows of the
Company and its Subsidiaries for such year and a consolidated balance
sheet of the Company and its Subsidiaries as at the end of such year,
setting forth in each case in comparative form corresponding figures
from the preceding annual audit, all in reasonable detail and
reasonably satisfactory in scope to the Required Holder(s) and
certified by independent public accountants of recognized standing
whose opinion shall be unqualified and otherwise satisfactory in scope
and substance to the Required Holder(s), provided that such opinion
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shall be deemed otherwise satisfactory if prepared and rendered in
accordance with GAAP and generally accepted auditing standards;
(iii) promptly upon transmission thereof, copies of all such
financial, proxy and information statements, notices and other reports
as are sent to the Company's stockholders and copies of all
registration statements (with such exhibits as any holder reasonably
requests) and all reports which are filed with the Securities and
Exchange Commission (or any governmental body or agency succeeding to
the functions of the Securities and Exchange Commission);
(iv) promptly upon receipt thereof, a copy of each other
report submitted to the Company or any of its Subsidiaries by
independent accountants in connection with any material annual, interim
or special audit made by them of the books of such Company or such
Subsidiary pursuant to a request by the Company's Board of Directors;
(v) promptly after the furnishing thereof, copies of any
certificate, statement or report furnished to any other holder of the
securities of the Company pursuant to the terms of any indenture, loan,
credit or similar agreement or instrument and not otherwise required to
be furnished to the holders of the Notes pursuant to any other clause
of this paragraph 5; and
(vi) with reasonable promptness, such other financial data
(including without limitation the information specified in paragraph
5E(ii)) as any holder of Notes may reasonably request.
Together with each delivery of financial statements required by clauses
(i) and (ii) above, the Company will deliver to each holder of Notes an
Officers' Certificate (a) setting forth the aggregate amount of Restricted
Payments made during such fiscal period and computations showing (non)compliance
with the covenants in paragraphs 6A(1), 6A(2), 6A(3), 6B(1)(iv), 6B(2)(iv),
6B(3)(iv), 6B(4) and 6B(6)(ii); and (b) stating that there exists no Default or
Event of Default, or if any such Default or Event of Default exists, specifying
the nature and period of existence thereof and what action the Company proposes
to take with respect thereto.
Together with each delivery of financial statements required by clause
(ii) above, the Company will deliver to each holder of Notes a certificate of
such accountants substantially in the form of Schedule 5A stating whether they
have obtained knowledge of any Event of Default or Default and, if so,
specifying the nature and period of existence thereof.
The Company also covenants that forthwith upon a Principal Officer
obtaining actual knowledge of an Event of Default or Default, it will deliver to
each holder of Notes an Officers' Certificate specifying the nature and period
of existence thereof and what action the Company proposes to take with respect
thereto.
5B. Inspection of Property. The Company covenants that it will permit
any employees or designated representatives of Prudential, any Prudential
Affiliate or any other holder of Notes in an original principal amount in excess
of $5,000,000, at such Person's expense, to visit and inspect any of the
properties of the Company and its Subsidiaries, to examine their books and
financial records and to make copies thereof or extracts therefrom and to
discuss their affairs, finances and accounts with the Principal Officers and the
Company's independent certified public accountants, all at such times as the
Company and such Person reasonably agree and as often as such Person may
reasonably request.
5C. Covenant to Secure Note Equally. The Company covenants that, if it
or any of its Subsidiaries shall create, assume or otherwise incur any Lien upon
any of its property or assets, whether now owned or hereafter acquired, other
than Liens permitted by the provisions of paragraph 6B(1) (unless prior written
consent to the creation or assumption thereof shall have been obtained pursuant
to paragraph 11C), it will make or cause to be made effective provision whereby
the Notes will be secured by such Lien equally and ratably with any and all
other Debt thereby secured so long as any such other Debt shall be so secured.
5D. Information Required by Rule 144A. The Company covenants that it
will, upon the request of the holder of any Note, provide such holder, and any
qualified institutional buyer designated by such holder, such financial and
other information as such holder may reasonably determine to be necessary in
order to permit compliance with the information requirements of Rule 144A under
the Securities Act in connection with the resale of Notes, except at such times
as the Company is subject to and in compliance with the reporting requirements
of section 13 or 15(d) of the Exchange Act. For the purpose of this paragraph
5D, the term "qualified institutional buyer" shall have the meaning specified in
Rule 144A under the Securities Act.
5E. Maintenance of Properties; Insurance. The Company covenants that it
and each Subsidiary will (i) maintain or cause to be maintained in good repair,
working order and condition all properties used or useful at that time in its
business and from time to time will make or cause to be made all appropriate
repairs, renewals and replacements thereof and (ii) maintain insurance with
reputable and financially sound insurers in such amounts and against such
liabilities and hazards as is customarily maintained by other companies
operating similar businesses and together with each delivery of financial
statements under clause (ii) of paragraph 5A, upon the request of any
Significant Holder of Notes, deliver certificates of insurance to the foregoing
effect to such Significant Holder.
5F. Environmental and Safety Laws. (i) The Company covenants that it
will deliver promptly to each Significant Holder notice of (a) any material
enforcement, cleanup, removal or other material governmental or regulatory
action instituted or, to the Company's best knowledge, threatened against the
Company or any Subsidiary pursuant to any Environmental and Safety Laws, (b) all
material Environmental Liabilities and Costs against or in respect of the
Property, the Company or any Subsidiary and (c) the Company's or any
Subsidiary's discovery of any occurrence or condition on any real property
adjoining or in the vicinity of the Property that the Company or such Subsidiary
has reason to believe could cause the Property or any material part thereof to
be subject to any material restrictions on its ownership, occupancy,
transferability or use under any Environmental and Safety Laws.
(ii) The Company covenants that it will, and will cause each of the
Subsidiaries to, keep and maintain the Property and conduct its and their
operations in compliance in all material respects with all applicable
Environmental and Safety Laws.
6. NEGATIVE COVENANTS. During the Issuance Period and so long
thereafter as any Note or amount due hereunder is outstanding and unpaid, the
Company covenants as follows:
6A. Financial Covenants. The Company will not permit:
6A(1). Minimum Net Worth. Consolidated Tangible Net Worth at any time
to be less than the sum of (a) $530,000,000 plus (b) to the extent positive, 25%
of Consolidated Cumulative Net Income for each fiscal quarter ended after
December 31, 2000 (such required minimum net worth not to be reduced by any
consolidated net loss during any such fiscal quarter).
6A(2). Debt to EBITDA Ratio. The Debt to EBITDA Ratio at any time to
exceed 300%; or
6A(3). Interest Coverage Ratio. The Interest Coverage Ratio for any
fiscal quarter (measured at the end of such fiscal quarter) to be less than
200%.
6B. Lien and Other Restrictions. The Company will not, and will not
permit any Subsidiary to:
6B(1). Liens. Create, assume or suffer to exist at any time any Lien on
or with respect to any of its property or assets, whether now owned or hereafter
acquired (whether or not provision is made for the equal and ratable securing of
the Notes in accordance with the provisions of paragraph 5C hereof), except:
(i) Liens for taxes not yet due or which are being actively
contested in good faith by appropriate proceedings and for which
adequate reserves have been established;
(ii) Liens incidental to the conduct of its business or the
ownership of its property and assets which were not incurred in
connection with the borrowing of money or the obtaining of advances of
credit, or the guarantee, maintenance, extension or renewal of the
same, and which do not in the aggregate materially detract from the
value of its property or assets, taken as a whole, or materially impair
the use thereof in the operation of its business;
(iii)(A) Liens on the vessels owned or to be owned or
chartered, or any shoreside facilities or equipment owned, leased or to
be owned or leased by ▇▇▇▇▇▇ or its Subsidiaries and (B) Liens securing
Debt between Subsidiaries or owing to the Company by a Subsidiary;
(iv) the giving, simultaneously with or within ninety (90)
days after the acquisition or construction of real property or tangible
personal property, of any purchase money lien (including vendor's
rights under purchase contracts under an agreement whereby title is
retained for the purpose of securing the purchase price thereof) on
real property or tangible personal property acquired or constructed
after December 31, 2000 and not theretofore owned by the Company or any
of its Subsidiaries, or the acquiring after December 31, 2000 of real
property or personal tangible property not theretofore owned by the
Company or any of its Subsidiaries subject to any then existing Lien
(whether or not assumed); provided, however, that notwithstanding the
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foregoing, non-▇▇▇▇▇▇ Subsidiaries may grant Liens on real property
owned on December 31, 2000 or thereafter acquired for development in
the ordinary course of Property Development Activities so long as the
aggregate amount of Debt secured by all such Liens does not, at any
time, exceed the sum of (A) $85,000,000 and (B) $5,000,000 for each
completed calendar year, commencing with the calendar year completed
December 31, 2001; and provided further, that in each such case
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(including Liens granted pursuant to the foregoing proviso) (x) such
Lien is limited to such real or tangible personal property, and (y) the
principal amounts of the Debt secured by each such Lien, together
(without duplication) with the principal amount of all other Debt
secured by Liens on such property, shall not exceed 100% of the cost
(which shall be deemed to include the amount of Debt secured by Liens,
including existing Liens, on such property) of such property to the
Company or any of its Subsidiaries;
(v) Liens (other than as specified in clauses (i) - (iv)
above) of the Company and Subsidiaries in existence on April 25, 2001
as set forth in Schedule 6B(1); and
(vi) subject to compliance with paragraph 6B(4), Liens
securing Debt other than as set forth in the foregoing clauses (i) -
(v); provided that there shall not exist any Lien of any kind on the
--------
shares of the Voting Stock of any Subsidiary, unless the Company and
Subsidiaries continue to own shares of Voting Stock of such Subsidiary
which are not subject to any Lien and which represent a majority of the
Voting Stock of such Subsidiary;
6B(2). Loans and Advances. Make or permit to remain outstanding at any
time any loan or advance to any Person, except that the Company and its
Subsidiaries may:
(i) subject to paragraph 6B(4), make or permit to remain
outstanding loans and advances to the Company and Subsidiaries;
(ii)make or permit to remain outstanding travel and other like
advances and customary employee benefits in reasonable amounts to
employees in the ordinary course of business;
(iii) make or permit to remain outstanding third party loans
and advances on standard arm's-length terms, all such loans and
advances not to exceed an aggregate of $50,000,000 at any time
outstanding; and
(iv) make or permit to remain outstanding purchase money loans
to Persons to whom it sells real property in the ordinary course of its
Property Development Activities, provided that the aggregate amount of
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all such purchase money loans may not exceed at any one time an amount
equal to 10% of Consolidated Total Assets at the end of the fiscal
quarter most recently-ended as of any date of determination;
6B(3). Merger and Sale of Assets. Merge with or into or consolidate
with any other Person or sell, lease, transfer or otherwise dispose of assets
(other than in the ordinary course of business), except that:
(i) any Subsidiary may merge with the Company, so long as the
Company is the surviving corporation;
(ii) any Subsidiary may merge with another Subsidiary, or
sell, lease, transfer or otherwise dispose of its assets to another
Subsidiary or to the Company; provided, however, that no Subsidiary
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(other than ▇▇▇▇▇▇ and ▇▇▇▇▇▇ Subsidiaries) may merge into or sell,
lease, transfer or otherwise dispose of any assets to any ▇▇▇▇▇▇
Subsidiary;
(iii) (A) Property Subs may sell, lease, transfer, exchange or
otherwise dispose of their real property to the extent that such sales
or other dispositions are made in the ordinary course of their Property
Development Activities, and (B) the Company may sell, lease, transfer,
exchange or otherwise dispose of the real property it owned as of
December 31, 2000 in the ordinary course of business;
(iv) the Company or any Subsidiary may sell, lease, transfer
or otherwise dispose of assets to third parties so long as (A) the fair
market value thereof on the date sold or otherwise disposed of,
together with the fair market value of all other assets sold or
otherwise disposed of to third parties (1) within the prior 12 months,
does not represent more than 15% of Consolidated Total Assets and (2)
since the date of this Agreement, does not represent more than 40% of
Consolidated Total Assets and (B) such assets, together with all other
assets sold or otherwise disposed of to third parties since the
beginning of the most recently ended fiscal year, did not contribute
more than 15% of Consolidated Net Income during the Company's most
recently ended fiscal year; provided that, notwithstanding the 15%
--------
limitation appearing clause (A), above, sales or dispositions in excess
thereof in a twelve month period may be made if the proceeds of such
sale or disposition are fully utilized in the acquisition of Permitted
Assets and/or applied to the repayment of Permitted Debt, in each case
within 365 days from the date of sale or disposition; and
(v) the Company may merge or consolidate with another
corporation or other Person if (A) it will be the continuing or
surviving entity and (B) no Default or Event of Default would exist
immediately after giving effect to such merger or consolidation;
6B(4). Priority Debt. Permit the aggregate amount of Priority Debt to
exceed the Priority Debt Limit;
6B(5). Sale or Discount of Receivables. Sell with recourse, or discount
or otherwise sell for less than the face value thereof, any of its notes or
accounts receivable (other than sales of accounts receivable the collection of
which is doubtful in accordance with GAAP);
6B(6). Sale-Leasebacks. Enter into any arrangement with any 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 such 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 a Subsidiary; provided, however, that such
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sale-leaseback transactions may be entered into by:
(i) ▇▇▇▇▇▇ and ▇▇▇▇▇▇ Subsidiaries without limitation; and
(ii) the Company and its non-▇▇▇▇▇▇ Subsidiaries so long as
the aggregate sales price of all assets sold or otherwise transferred
after December 20, 1990 pursuant to such transactions does not exceed
5% of Consolidated Tangible Net Worth (measured as at the end of the
fiscal quarter immediately preceding the date of such sale-leaseback);
6B(7). Transactions with Holders of Partnership or Other Equity
Interests. Directly or indirectly, purchase, acquire or lease any property from,
or sell, transfer or lease any property to, or otherwise deal with, in the
ordinary course of business or otherwise (i) any Affiliate (other than in the
capacity of an employee), or (ii) any Person owning, beneficially or of record,
directly or indirectly, 5% or more of the outstanding voting stock of the
Company or any executive officer (as such term is defined under the Securities
Exchange Act of 1934, as amended) of the Company (other than in such Person's
capacity as an employee); provided, however, that such acts and transactions may
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be performed or engaged in if they are entered into upon terms no less favorable
to the Company or such Subsidiary than if no such relationship described in
clauses (i) or (ii) above existed and such acts or transactions are otherwise
permitted by this Agreement;
6B(8). Transfer of Assets to Subsidiaries. Transfer (other than in the
ordinary course of business) any assets to a Subsidiary for the principal
purpose of improving the credit position of such Subsidiary in order to enable
it to borrow money;
6B(9). Sale of Stock and Debt of Subsidiaries. Sell or otherwise
dispose of, or part with control of, any shares of stock (or similar equity
securities) or Debt or other obligations of any Subsidiary, or permit any
Subsidiary to issue shares of its stock (or similar equity securities), to any
Person other than to a Company or another Subsidiary (except that non-▇▇▇▇▇▇
Subsidiaries may not issue shares of capital stock to ▇▇▇▇▇▇ or a ▇▇▇▇▇▇
Subsidiary), and except that (i) the Property Subs may sell or otherwise dispose
or part with control of all shares of stock (or similar equity securities) of
special purpose Subsidiaries (i.e., Subsidiaries established to hold and develop
real property only for specific development projects) if such sale or
disposition is made in the ordinary course of their Property Development
Activities and (ii) all shares of stock (or similar equity securities) and Debt
or other obligations of any Subsidiary at the time owned by or owed to the
Company and any Subsidiary may be sold as an entirety to any third party for a
consideration which represents fair value (as determined in good faith by its
Board of Directors) at the time of such sale; provided, however, that the
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securities or other obligations so sold shall constitute assets subject to the
limitations and other provisions of paragraph 6B(3); and provided, further,
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that, at the time of such sale, such Subsidiary shall not own, directly or
indirectly, any shares of stock or Debt or other obligations of any other
Subsidiary or of the Company (unless all of the shares of stock and Debt or
other obligations of such other Subsidiary owned, directly or indirectly, by the
Company and all Subsidiaries are simultaneously being sold as permitted by this
paragraph 6B(9));
6C. Restricted Payments. The Company covenants that it will not declare
or pay any dividend or other distribution on any class of its capital stock or
other equity interests, redeem or repurchase any such interests or make any
other distribution on account of any such interests (all of the foregoing being
"Restricted Payments") except that the Company may make a Restricted Payment in
any amount so long as (i) no Default or Event of Default shall then exist or
would exist after giving effect to any such Restricted Payment and (ii) any such
Restricted Payment will not violate any applicable law or regulation.
7. EVENTS OF DEFAULT.
7A. Acceleration. If any of the following events shall occur and be
continuing for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law or
otherwise):
(i) the Company defaults in the payment of any principal of,
or interest or Yield-Maintenance Amount on, any Note, for more than
five Business Days after the same shall become due, either by the terms
thereof or otherwise as herein provided; or
(ii) the Company or any Subsidiary defaults in any payment of
principal of, or premium or interest on, any obligation for money
borrowed (or of any obligation under conditional sale or other title
retention agreement or of any obligation issued or assumed as full or
partial payment for property whether or not secured by a purchase money
mortgage or of any obligation under notes payable or drafts accepted
representing extensions of credit) other than the Notes beyond any
period of grace provided with respect thereto, or the Company or any
Subsidiary fails to perform or observe any other agreement, term or
condition contained in any agreement (or any other event thereunder or
under any such agreement occurs and is continuing) and the effect of
such default, failure or other event is to cause, or permit the holder
or holders of such obligation (or a trustee on behalf of such holder or
holders) to cause, such obligation to become due (or to be repurchased
by the Company or any Subsidiary) prior to any stated maturity;
provided that the aggregate amount of all obligations as to which such
a payment default shall occur or such a failure or other event causing
or permitting acceleration (or resale to a Company or any Subsidiary)
shall occur and be continuing exceeds $10,000,000; or
(iii) any representation or warranty made by the Company
herein or by the Company or any of its officers in any writing
furnished in connection with or pursuant to this Agreement shall be
false or misleading in any material respect on the date as of which
made; or
(iv) the Company fails to perform or observe any agreement
contained in paragraphs 5C or 6 hereof; or
(v) the Company or any Subsidiary fails to perform or observe
any other agreement, term or condition contained herein and such
failure shall not be remedied within 30 days after any Principal
Officer obtains actual knowledge thereof; or
(vi) the Company or any Significant Subsidiary makes an
assignment for the benefit of creditors or is generally not paying its
debts as such debts become due; or
(vii) any decree or order for relief in respect of the Company
or any Significant Subsidiary is entered under any bankruptcy,
reorganization, compromise, arrangement, insolvency, readjustment of
debt, dissolution, liquidation or similar law, whether now or hereafter
in effect (herein called the "Bankruptcy Law"), of any jurisdiction; or
(viii) the Company or any Significant Subsidiary petitions or
applies to any tribunal for, or consents to, the appointment of, or
taking possession by, a trustee, receiver, custodian, liquidator or
similar official of the Company or any such Significant Subsidiary, or
of any substantial part of the assets of the Company or any such
Significant Subsidiary, or commences a voluntary case under the
Bankruptcy Law of the United States or any proceedings (other than
proceedings for the voluntary liquidation and dissolution of a
Significant Subsidiary) relating to the Company or any Significant
Subsidiary under the Bankruptcy Law of any other jurisdiction; or
(ix) any petition or application of the type described in
clause (viii) of this paragraph 7A is filed, or any such proceedings
are commenced, against the Company or any Significant Subsidiary and
the Company or such Significant Subsidiary by any act indicates its
approval thereof, consent thereto or acquiescence therein, or an order,
judgment or decree is entered appointing any such trustee, receiver,
custodian, liquidator or similar official, or approving the petition in
any such proceedings, and such order, judgment or decree remains
unstayed and in effect for more than 30 days; or
(x) any order, judgment or decree is entered in any
proceedings against the Company or any Significant Subsidiary decreeing
the dissolution of such Company or such Significant Subsidiary and such
order, judgment or decree remains unstayed and in effect for more than
30 days; or
(xi) any order, judgment or decree is entered in any
proceedings against the Company or any Significant Subsidiary decreeing
a split-up of the Company or such Significant Subsidiary which requires
the divestiture of (A) assets representing a substantial part, or the
stock of, or other ownership interest in, a Significant Subsidiary
whose assets represent a substantial part of Consolidated Total Assets
or (B) assets or the stock of or other ownership interest in a
Significant Subsidiary that has contributed a substantial part of
Consolidated Cumulative Net Income for any of the three fiscal years
then most recently ended, and such order, judgment or decree remains
unstayed and in effect for more than 30 days; or
(xii) (a) 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, (b) a notice of intent
to terminate any Plan shall have been or is reasonably expected to be
filed with the PBCG 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 such proceedings, (c) 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 $15,000,000, (d) the Company or any
ERISA Affiliate shall have incurred or is reasonably expected to incur
any liability pursuant to Title I or IV or ERISA or the penalty or
excise tax provisions of the Code relating to employee benefit plans,
(e) the Company or any ERISA Affiliate withdraws from any Multiemployer
Plan, or (f) 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 (a) through (f) above, either individually or together with any
other such event or events, could reasonably be expected to have a
material adverse effect on the business or condition (financial or
otherwise) of the Company; or
(xiii) any judgment or decree in the amount of $10,000,000 or
more shall be entered against the Company or any of its Subsidiaries
that is not paid or fully covered (beyond any applicable deductibles)
by insurance and such judgment or decree shall not have been vacated,
discharged or stayed or bonded pending appeal within 60 days from the
entry thereof;
then (a) if such event is an Event of Default specified in clause (i) of this
paragraph 7A, the holder of any Note (other than a Company or any of its
Subsidiaries or Affiliates) may at its option, by notice in writing to the
Company, declare such Note to be, and such Note shall thereupon be and become,
immediately due and payable at par together with interest accrued thereon
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by the Company, (b) if such event is an Event of Default
specified in clause (vii), (viii) or (ix) of this paragraph 7A with respect to
the Company, all of the Notes at the time outstanding shall automatically become
immediately due and payable together with interest accrued thereon and the
Yield-Maintenance Amount with respect thereto, without presentment, demand,
protest or notice of any kind, all of which are hereby waived by the Company,
and (c) with respect to any event constituting an Event of Default, the Required
Holder(s) of any Series of Notes may at its or their option, by notice in
writing to the Company, declare all of the Notes of such Series to be, and all
of the Notes of such Series shall thereupon be and become, immediately due and
payable together with interest accrued thereon and together with the
Yield-Maintenance Amount, if any, with respect to each Note of such Series,
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by the Company.
7B. Rescission of Acceleration. At any time after any or all of the
Notes of a Series shall have been declared immediately due and payable pursuant
to paragraph 7A, the Required Holder(s) of such Series may, by notice in writing
to the Company, rescind and annul such declaration and its consequences if (i)
the Company shall have paid all overdue interest on the Notes of such Series,
the principal of and Yield-Maintenance Amount, if any, payable with respect to
any Notes of such Series which have become due otherwise than by reason of such
declaration, and interest on such overdue interest and overdue principal and
Yield-Maintenance Amount at the rate specified in the Notes of such Series, (ii)
the Company shall not have paid any amounts which have become due solely by
reason of such declaration, (iii) all Events of Default and Defaults, other than
non-payment of amounts which have become due solely by reason of such
declaration, shall have been cured or waived pursuant to paragraph 11C, and (iv)
no judgment or decree shall have been entered for the payment of any amounts due
pursuant to the Notes of such Series or this Agreement (as this Agreement
pertains to the Notes of such Series). No such rescission or annulment shall
extend to or affect any subsequent Event of Default or Default or impair any
right arising therefrom.
7C. Notice of Acceleration or Rescission. Whenever any Note shall be
declared immediately due and payable pursuant to paragraph 7A or any such
declaration shall be rescinded and annulled pursuant to paragraph 7B, the
Company shall forthwith give written notice thereof to the holder of each Note
at the time outstanding.
7D. Other Remedies. If any Event of Default or Default shall occur and
be continuing, the holder of any Note may proceed to protect and enforce its
rights under this Agreement and such Note by exercising such remedies as are
available to such holder in respect thereof under applicable law, either by suit
in equity or by action at law, or both, whether for specific performance of any
covenant or other agreement contained in this Agreement or in aid of the
exercise of any power granted in this Agreement. No remedy conferred in this
Agreement upon the holder of any Note is intended to be exclusive of any other
remedy, and each and every such remedy shall be cumulative and shall be in
addition to every other remedy conferred herein or now or hereafter existing at
law or in equity or by statute or otherwise.
8. REPRESENTATIONS, COVENANTS AND WARRANTIES. The Company represents,
covenants and warrants as follows:
8A. Organization. The Company and each Subsidiary with a tangible net
worth in excess of $500,000 is duly organized, validly existing and in good
standing under the laws of the state of its organization. The Company and each
Significant Subsidiary has the full power and authority to own its properties
and to carry on its business as now being conducted, and is duly qualified in
every state where the nature of its business requires that it do so, and is in
good standing under the laws of every jurisdiction outside the state of its
incorporation in which it owns or leases property or conducts business and in
which the failure to so qualify would have a material adverse effect upon its
business or property taken as a whole. The Company and each Significant
Subsidiary has complied in all material respects with (or is exempt from the
application of) all material federal, state and local laws, regulations and
orders that are, or in the absence of any exemption could be, applicable to the
operations of its business, including public utility, bank holding company,
state agricultural and Environmental and Safety Laws. The Company has full
power, authority and right to execute and deliver, and to perform and observe,
the provisions of this Agreement and the Notes and to carry out the transactions
contemplated hereby and thereby. The execution, delivery and performance of this
Agreement and the Notes to be issued hereunder by the Company has been
authorized by all necessary corporate and other action, and, when duly executed
and delivered, will be the legal, valid and binding obligations of the Company,
enforceable against it in accordance with their respective terms.
8B. Financial Statements. The Company has furnished each Purchaser of
any Accepted Notes with the following financial statements, identified by a
principal financial officer of the Company: (i) consolidated balance sheets of
the Company and its Subsidiaries as of the last day in each of the five fiscal
years of the Company most recently completed prior to the date as of which this
representation is made or repeated (other than fiscal years completed within 120
days prior to such date for which audited financial statements have not been
released) and consolidated statements of income, shareholders' equity and cash
flows of the Company and its Subsidiaries for each such year, certified by
Deloitte & Touche (or such other accounting firm as may be reasonably acceptable
to Prudential); and (ii) consolidated balance sheets of the Company and its
Subsidiaries as at the end of the quarterly period (if any) most recently
completed prior to such date and after the end of such fiscal year (other than
quarterly periods completed within 60 days prior to such date for which
financial statements have not been released) and the comparable quarterly period
in the preceding fiscal year and consolidated statements of income,
stockholders' equity and cash flows of the Company and its Subsidiaries for the
periods from the beginning of the fiscal years in which such quarterly periods
are included to the end of such quarterly periods, in each case prepared by the
Company. Such financial statements (including any related schedules and/or
notes) are true and correct in all material respects (subject, as to interim
statements, to changes resulting from audits and year-end adjustments), have
been prepared in accordance with GAAP consistently followed throughout the
periods involved and show all liabilities, direct and contingent, of the Company
and its Subsidiaries required to be shown in accordance with such principles.
The balance sheets fairly present the condition of the Company and its
Subsidiaries as at the dates thereof, and the statements of income,
shareholders' equity and cash flows fairly present the results of the operations
and cash flows of the Company and its Subsidiaries for the periods indicated.
There has been no material adverse change in the business, condition (financial
or otherwise) or operations of the Company and its Subsidiaries taken as a whole
since the end of the most recent fiscal year for which such audited financial
statements have been furnished.
8C. Actions Pending. There is no action, suit, investigation or
proceeding pending or, to the knowledge of the Company, threatened against the
Company or any Subsidiary or any properties or rights of the Company or any
Subsidiary, by or before any court, arbitrator or administrative or governmental
body which could reasonably be expected to result in any material adverse change
in the business, condition (financial or otherwise) or operations of the Company
and its Subsidiaries taken as a whole.
8D. Outstanding Debt. Neither the Company nor any Subsidiary has any
Debt outstanding except as permitted by paragraph 6A(2), 6A(3) and 6B(4). There
exists no default under the provisions of any instrument evidencing any such
Debt or of any agreement relating thereto.
8E. Title to Properties. The Company and each Significant Subsidiary
has such title to its properties and assets as is appropriate and sufficient for
the conduct of the business which such Company or Significant Subsidiary
presently undertakes or contemplates undertaking. There are no Liens on such
properties and assets that (i) materially restrict such Company's or Significant
Subsidiary's intended use and enjoyment thereof in the ordinary course of
business or (ii) are not permitted by paragraph 6B(1). There is no material
default, nor any event that, with notice or lapse of time or both, would
constitute such a material default under any material lease to which either the
Company or any such Significant Subsidiary is a lessee, lessor, sublessee or
sublessor.
8F. Taxes. The Company and each Subsidiary with a tangible net worth in
excess of $500,000 has filed all Federal, state and other income tax and
informational returns which are required to be filed by it. The Company and each
such Subsidiary has paid all taxes as shown on its returns and on all
assessments received to the extent that such taxes have become due, except such
assessments as are being contested in good faith by appropriate proceedings for
which adequate reserves have been established in accordance with GAAP.
8G. Conflicting Agreements and Other Matters. Neither the execution nor
delivery of this Agreement or the Notes, nor the offering, issuance and sale of
the Notes, nor fulfillment of nor compliance with the terms and provisions of
this Agreement or the Notes will conflict with, or result in a breach of the
terms, conditions or provisions of, or constitute a default under, or result in
any violation of, or result in the creation of any Lien upon any of the
properties or assets of the Company or any Subsidiary pursuant to, their
respective articles or incorporation or bylaws (or other comparable governing
documents, as applicable), any award of any arbitrator or any agreement,
instrument, order, judgment, decree, and, after due investigation and to the
Company's best knowledge, any statute, law, rule or regulation to which the
Company or any Subsidiary is subject. Neither the Company nor any Subsidiary is
a party to, or otherwise subject to any provision contained in, any instrument
evidencing any of their respective Debt, any agreement relating thereto or any
other contract or agreement which restricts or otherwise limits the incurring of
Debt pursuant hereto, except as set forth on Schedule 8G hereto.
8H. Offering of the Notes. Neither the Company nor any agent acting on
its behalf has, directly or indirectly, offered the Notes or any similar
security of the Company for sale to, or solicited any offers to buy the Notes or
any similar security of the Company from, or otherwise approached or negotiated
with respect thereto with, any Person or Persons other than Prudential and the
Purchasers, and neither the Company nor any agent acting on its behalf has taken
or will take any action which would subject the issuance or sale of the Notes to
the provisions of Section 5 of the Securities Act or to the provisions of any
securities or blue sky law of any applicable jurisdiction.
8I. Regulation U, etc. The amount of all securities that the Company
and its Subsidiaries together own that constitute "margin stock" (as defined in
Regulation G (12 CFR Part 221) of the Board of Governors of the Federal Reserve
System (herein called "margin stock")) does not exceed 25% of Consolidated Total
Assets. None of the proceeds of the Notes will be used, directly or indirectly,
for the purpose, whether immediate, incidental or ultimate, of purchasing or
carrying any margin stock or for the purpose of maintaining, reducing or
retiring any indebtedness which was originally incurred to purchase or carry any
stock that is currently a margin stock or for any other purpose which might
constitute this transaction a "purpose credit" within the meaning of such
Regulation U. Neither the Company nor any agent acting on its behalf has taken
or will take any action which might cause this Agreement or the Notes to violate
Regulation U, Regulation T or any other regulation of the Board of Governors of
the Federal Reserve System or to violate the Exchange Act, in each case as in
effect now or as the same may hereafter be in effect.
8J. ERISA. No accumulated funding deficiency (as defined in section 302
of ERISA and section 412 of the Code), whether or not waived, exists with
respect to any Plan (other than a Multiemployer Plan). No liability to the PBGC
has been or is expected by the Company or any ERISA Affiliate to be incurred
with respect to any Plan (other than a Multiemployer Plan) by the Company, any
Subsidiary or any ERISA Affiliate which is or would be materially adverse to the
business, condition (financial or otherwise) or operations of the Company and
its Subsidiaries taken as a whole. Neither the Company, any of its Subsidiaries
or any ERISA Affiliate has incurred or presently expects to incur any withdrawal
liability under Title IV of ERISA with respect to any Multiemployer Plan which
is or would be materially adverse to the Company and its Subsidiaries taken as a
whole. The execution and delivery of this Agreement and the issuance and sale of
the Notes will be exempt from, or will not involve any transaction which is
subject to the prohibitions of, section 406 of ERISA and will not involve any
transaction in connection with which a penalty could be imposed under section
502(i) of ERISA or a tax could be imposed pursuant to section 4975 of the Code.
The representation by the Company in the next preceding sentence is made in
reliance upon and subject to the accuracy of each Purchaser's representation in
paragraph 9B.
8K. Governmental Consent. Neither the nature of the Company or any of
its Subsidiaries, nor any of their respective businesses or properties, nor any
relationship between the Company or a Subsidiary and any other Person, nor any
circumstance in connection with the offering, issuance, sale or delivery of the
Notes is such as to require any authorization, consent, approval, exemption or
other action by, notice to or filing with any court, administrative or
governmental body (other than routine filings after the date of closing with the
Securities and Exchange Commission and/or state blue sky authorities) in
connection with (i) the execution and delivery of this Agreement, (ii) the
offering, issuance, sale or delivery of the Notes or (iii) fulfillment of or
compliance with the terms and provisions of this Agreement and the Notes.
8L. Utility Company Status. The Company is not a public utility within
the meaning of the Federal Power Act, as amended. The Company is not subject to
regulation under the Public Utility Holding Company Act of 1935, as amended.
8M. Investment Company Status. The Company is not an "investment
company" or a company "controlled" by an "investment company" within the meaning
of the Investment Company Act of 1940, as amended, or an "investment adviser"
within the meaning of the Investment Advisers Act of 1940, as amended.
8N. Bank Holding Company Status. Neither the Company nor any Subsidiary
is a "bank holding company" within the meaning of the Federal Deposit Insurance
Act (12 U.S.C. Section 1811, et. seq.), as amended.
8O. Real Property Matters. The Company and each Significant Subsidiary
has, for the real property which it owns or uses, such authorizations, consents,
approvals, licenses and permissions (collectively, "Consents") that the Company
or such Significant Subsidiary believes or has been advised by counsel to be now
necessary for it to own, hold, develop, use or operate such real property in its
current or intended manner, all in material compliance with applicable laws and
regulations. Neither the Company nor any Significant Subsidiary has received any
notice that any such Consent is necessary which has not been obtained, other
than applications for the same that have been timely filed and are being
diligently pursued with the appropriate governmental authorities and agencies.
8P. Possession of Franchises, Licenses, etc. The Company and its
Subsidiaries possess all material franchises, certificates, licenses,
development and other permits and other authorizations from governmental
political subdivisions or regulatory authorities and all patents, trademarks,
service marks, trade names, copyrights, licenses, easements, rights of way and
other rights (collectively, "Material Rights"), free from burdensome
restriction, that are necessary in the judgment of the Company in any material
respect for the ownership, maintenance and operation of their business,
properties and assets, and neither the Company nor any of its Subsidiaries is in
violation of any Material Rights in any material respect. No event has occurred
which permits, or after notice or lapse of time or both would permit, the
revocation or termination of any such Material Rights, or materially and
adversely affect the rights of the Company or its Subsidiaries thereunder.
8Q. Environmental and Safety Matters. The Company and its Subsidiaries
and all of their respective properties and facilities have complied at all times
and in all respects with all Environmental and Safety Laws except where failure
to comply would not result in a material adverse effect on the business,
condition (financial or otherwise) or operations of the Company and its
Subsidiaries taken as a whole.
8R. Hostile Tender Offers. None of the proceeds of the sale of any
Notes will be used to finance a Hostile Tender Offer.
8S. Employee Relations. Neither the Company nor any Subsidiary is the
subject of (i) any material strike, work slowdown or stoppage, union organizing
drive or other similar activity or (ii) any material action, suit, investigation
or other proceeding involving alleged employment discrimination, unfair
termination, employee safety or similar matters or, to the best knowledge of the
Company, is any such event imminent or likely to occur.
8T. Regulations and Legislation. To the best knowledge of the Company,
no law, regulation, interpretation or legislation has been enacted or issued or
is likely to be enacted or issued, that would reasonably be expected to have a
material adverse effect on the operations or financial condition of the Company
and its Subsidiaries taken as a whole.
8U. Disclosure. Neither this Agreement nor any other document,
certificate or statement furnished to any Purchaser by or on behalf of the
Company in connection herewith contains any untrue statement of a material fact
or omits to state a material fact necessary in order to make the statements
contained herein and therein not misleading. There is no fact peculiar to the
Company or any Subsidiary which materially adversely affects, or in the future
may (so far as the Company can now foresee) materially adversely affect, the
consolidated business, property, assets, prospects or financial condition of the
Company and the Subsidiaries and which has not been set forth in this Agreement
or in the other documents, certificates and statements furnished to each
Purchaser by or on behalf of the Company prior to the date this representation
is made or confirmed in connection with the transactions contemplated hereby.
9. REPRESENTATIONS OF THE PURCHASERS.
Each Purchaser represents as follows:
9A. Nature of Purchase. Such Purchaser is acquiring the Notes purchased
by it hereunder for the purpose of investment and not with a view to or for sale
in connection with any distribution thereof within the meaning of the Securities
Act, provided that the disposition of such Purchaser's property shall at all
times be and remain within its control. Such Purchaser understands that the
Notes have not been registered under the Securities Act and may be exchanged,
offered, transferred or resold only if registered pursuant to the provisions of
the Securities Act or if an exemption from registration is available, and that
the Company is not required to register the Notes.
9B. Source of Funds. At least one of the following statements is an
accurate representation as to each source of funds (a "Source") to be used by
such Purchaser to pay the purchase price of the Notes to be purchased by such
Purchaser hereunder:
(i) the Source is an "insurance company general account" (as
the term is defined in the United States Department of Labor's Prohibited
Transaction Exemption ("PTE") 95-60) in respect of which the reserves and
liabilities (as defined by the annual statement for life insurance companies
approved by the National Association of Insurance Commissioners (the "NAIC
Annual Statement")) for the general account contract(s) held by or on behalf of
any employee benefit plan together with the amount of the reserves and
liabilities for the general account contract(s) held by or on behalf of any
other employee benefit plans maintained by the same employer (or affiliate
thereof as defined in PTE 95-60) or by the same employee organization in the
general account 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 such Purchaser's state of
domicile; or
(ii) the Source is a separate account that is maintained
solely in connection with such Purchaser's fixed contractual obligations under
which the amount payable, or credited, to any employee benefit plan (or its
related trust) that has any interest in such separate account (or to any
participant or beneficiary of such plan (including any annuitant)) are not
affected in any manner by the investment performance of the separate account; or
(iii) the Source is either (a) an insurance company pooled
separate account, within the meaning of PTE 90-1 or (b) a bank collective
investment fund, within the meaning of the PTE 91-38 and, except as disclosed by
such Purchaser to the Company in writing pursuant to this clause (iii), 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
(iv) the Source constitutes assets of an "investment fund"
(within the meaning of Part V of PTE 84-14 (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
benefits 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 (a) the
identity of such QPAM and (b) 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 clause (iv); or
(v) the Source constitutes assets of a "plan(s)" (within the
meaning of Section IV or PTE ▇▇-▇▇ (▇▇▇ "▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇")) managed by an
"in-house asset manager" or "INHAM" (within the meaning of Part IV of the INHAM
exemption), the conditions of Part I(a), (g) and (h) of the INHAM Exemption are
satisfied, neither the INHAM nor a person controlling or controlled by the
INHAM (applying the definition of "control" in Section IV(h) of the INHAM
Exemption) owns a 5% or more interest in the Company and (a) the identity of
such INHAM and (b) the name(s) of the employee benefit plan(s) whose assets
constitute the Source have been disclosed to the Company in writing pursuant to
this clause (v); or
(vi) the Source is a governmental plan; or
(vii) 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
clause (vii); or
(viii) 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 paragraph 9B, the terms "employee benefit plan,"
"governmental plan," and "separate account" shall have the respective meanings
assigned to such terms in Section 3 of ERISA.
10. DEFINITIONS; ACCOUNTING MATTERS. For the purpose of this Agreement,
the terms defined in paragraphs 10A and 10B (or within the text of any other
paragraph) shall have the respective meanings specified therein and all
accounting matters shall be subject to determination as provided in paragraph
10C.
10A. Yield-Maintenance Terms.
"Business Day" shall mean any day other than a Saturday, a Sunday or a
day on which commercial banks in New York City, San Francisco, California or
Honolulu, Hawaii are required or authorized to be closed.
"Called Principal" shall mean, with respect to any Note, the principal
of such Note that (i) is to be prepaid pursuant to paragraph 4B or (ii) is
declared to be immediately due and payable pursuant to paragraph 7A, as the
context requires.
"Designated Spread" shall mean 0 in the case of each Note of any Series
unless the Confirmation of Acceptance with respect to the Notes of such Series
specifies a different Designated Spread in which case it shall mean, with
respect to each Note of such Series, the Designated Spread so specified.
"Discounted Value" shall mean, 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 (converted to reflect the
periodic basis on which interest on such Note is payable, if payable other than
on a semiannual basis) equal to the Reinvestment Yield with respect to such
Called Principal.
"Reinvestment Yield" shall mean, with respect to the Called Principal
of any Note, the Designated Spread over the yield to maturity implied by (i) the
yields reported, as of 10:00 a.m. (New York City local time) on the Business Day
next preceding the Settlement Date with respect to such Called Principal, 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 on
the Treasury Yield Monitor page of Standard & Poor's MMS - Treasury Market
Insight (or, if Standard & Poor's shall cease to report such yields in MMS -
Treasury Market Insight or shall cease to be Prudential's customary source of
information for calculating yield-maintenance amounts on privately placed notes,
then such source as is then PIM's customary source of such information), or if
such yields shall not be reported as of such time or the yields reported as of
such time shall not be ascertainable, (ii) the Treasury Constant Maturity Series
yields reported, for the latest day for which such yields shall have been
reported as of the Business Day next 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 shall be
determined, if necessary, by (a) converting U.S. Treasury ▇▇▇▇ quotations to
bond-equivalent yields in accordance with accepted financial practice and (b)
interpolating linearly between yields reported for various maturities. The
Reinvestment Yield shall be rounded to that number of decimal places as appears
in the coupon for the applicable Note.
"Remaining Average Life" shall mean, with respect to the Called
Principal of any Note, 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) each Remaining Scheduled Payment
of such Called Principal (but not of interest thereon) by (b) the number of
years (calculated to the nearest one-twelfth year) which 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" shall mean, with respect to the Called
Principal of any Note, all payments of such Called Principal and interest
thereon that would be due on or 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.
"Settlement Date" shall mean, with respect to the Called Principal of
any Note, the date on which such Called Principal (i) is to be prepaid pursuant
to paragraph 4B or (ii) is declared to be immediately due and payable pursuant
to paragraph 7A, as the context requires.
"Yield-Maintenance Amount" shall mean, with respect to any Note, an
amount equal to the excess, if any, of the Discounted Value of the Called
Principal of such Note over the sum of (i) such Called Principal plus (ii)
interest accrued thereon as of (including interest due on) the Settlement Date
with respect to such Called Principal. The Yield-Maintenance Amount shall in no
event be less than zero.
10B. Other Terms.
"Acceptance" shall have the meaning specified in paragraph 2B(5).
"Acceptance Day" shall have the meaning specified in paragraph 2B(5).
"Acceptance Window" shall have the meaning specified in paragraph
2B(5).
"Accepted Note" shall have the meaning specified in paragraph 2B(5).
"Accumulated Funding Deficiency" shall mean a funding deficiency
described in section 302 of ERISA and section 412 of the Code.
"Affiliate" shall mean, without duplication, any Person directly or
indirectly controlling, controlled by, or under direct or indirect common
control with, the Company, except a Subsidiary. A Person shall be deemed to
control another Person if such first Person possesses, directly or indirectly,
the power to direct or cause the direction of the management and policies of
such other Person, whether through the ownership of voting securities, by
contract or otherwise.
"Agreement" shall have the meaning specified in paragraph 11C.
"Authorized Officer" shall mean (i) in the case of the Company, any
officer of the Company designated as an "Authorized Officer" in the Information
Schedule or any officer of the Company designated as an "Authorized Officer" for
the purpose of this Agreement in a certificate executed by one of the Company's
Authorized Officers and (ii) in the case of Prudential, any officer of
Prudential designated as its "Authorized Officer" in the Information Schedule or
any officer of Prudential designated as its "Authorized Officer" for the purpose
of this Agreement in a certificate executed by one of its Authorized Officers.
Any action taken under this Agreement on behalf of the Company by any individual
who on or after the date of this Agreement shall have been an Authorized Officer
of the Company and whom Prudential in good faith believes to be an Authorized
Officer of the Company at the time of such action shall be binding on the
Company even though such individual shall have ceased to be an Authorized
Officer of the Company, and any action taken under this Agreement on behalf of
Prudential by any individual who on or after the date of this Agreement shall
have been an Authorized Officer of Prudential, and whom the Company in good
faith believe to be an Authorized Officer of Prudential at the time of such
action shall be binding on Prudential even though such individual shall have
ceased to be an Authorized Officer of Prudential.
"Available Facility Amount" shall have the meaning specified in
paragraph 2B(1).
"Bankruptcy Law" shall have the meaning specified in clause (vii) of
paragraph 7A.
"Business Day" shall have the meaning specified in paragraph 10A.
"Cancellation Date" shall have the meaning specified in paragraph
2B(8)(iv).
"Cancellation Fee" shall have the meaning specified in paragraph
2B(8)(iv).
"Capitalized Lease Obligation" shall mean, with respect to any Person,
any rental obligation of such Person which, under GAAP, is or will be required
to be capitalized on the books of such Person, taken at the amount thereof
accounted for as indebtedness (net of interest expense) in accordance with such
principles.
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation and Liability Act (42 U.S.C. Section 9601 et. seq.), as amended,
and the regulations promulgated thereunder.
"Closing Day" shall mean, with respect to any Accepted Note, the
Business Day specified for the closing of the purchase and sale of such Accepted
Note in the Request for Purchase of such Accepted Note, provided that (i) if the
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Company and the Purchaser which is obligated to purchase such Accepted Note
agree on an earlier Business Day for such closing, the "Closing Day" for such
Accepted Note shall be such earlier Business Day, and (ii) if the closing of the
purchase and sale of such Accepted Note is rescheduled pursuant to paragraph
2B(7), the Closing Day for such Accepted Note, for all purposes of this
Agreement except references to "original Closing Day" in paragraph 2B(8)(iii),
shall mean the Rescheduled Closing Day with respect to such Accepted Note.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Confirmation of Acceptance" shall have the meaning specified in
paragraph 2B(5).
"Consolidated Cumulative Net Income" shall mean the aggregate
Consolidated Net Income for the fiscal period(s) in question.
"Consolidated Interest Expense" shall mean the sum of all amounts that
would, in accordance with GAAP, be deducted in computing Consolidated Net Income
for the fiscal periods in question on account of interest, including without
limitation, imputed interest in respect of Capitalized Lease Obligations, fees
in respect of letters of credit and bankers' acceptance financing and
amortization of debt discount and expense.
"Consolidated Net Income" shall mean the consolidated gross revenues of
the Company and Subsidiaries for the period in question, less all operating and
non-operating expenses, including all charges of a proper character (including
current and deferred taxes on income, provision for taxes on unremitted foreign
earnings which are included in gross revenues, and current additions to
reserves), but not including in gross revenues any (i) gains (net of expenses
and taxes applicable thereto) in excess of losses resulting from the sale,
conversion, exchange or other disposition of capital assets (i.e., assets other
than current assets) other than real property sold for cash, cash equivalents or
other property or tangible assets by the Property Subs in the ordinary course of
their Property Development Activities, (ii) gains resulting from the write-up of
assets, (iii) equity in the unremitted earnings of any other Person (other than
of Subsidiaries) or (iv) net income, gain or loss during such period from any
change in accounting, from any Discontinued Operations or the disposition
thereof, from any extraordinary events or from any prior period adjustments, all
determined in accordance with GAAP.
"Consolidated Net Income Before Taxes" shall mean Consolidated Net
Income for the period in question plus the sum of all deferred and current
Federal, state, local and foreign taxes that are deducted in accordance with
GAAP in computing Consolidated Net Income for such period.
"Consolidated Tangible Net Worth" shall mean, at any time of
determination thereof, the consolidated net worth of the Company and
Subsidiaries, determined in accordance with GAAP, less all Intangibles.
"Consolidated Total Assets" shall mean, at any time of determination
thereof, the consolidated total assets of the Company and Subsidiaries
determined in accordance with GAAP.
"Debt" shall mean, as to any Person at the time of determination
thereof without duplication, (i) any indebtedness of such Person (A) for
borrowed money, including commercial paper and revolving credit lines, (B)
evidenced by bonds, debentures or notes or otherwise representing extensions of
credit, whether or not representing obligations for borrowed money or (C) for
the payment of the deferred purchase price of property or services, except trade
accounts payable arising in the ordinary course of business, regardless of when
such liability or other obligation is due and payable, (ii) Capitalized Lease
Obligations of such Person, (iii) Guarantees, assumptions and endorsements by
such Person (other than endorsements of negotiable instruments for collection in
the ordinary course of business) of Debt of another Person, and (iv) Debt of
another Person secured by Liens on the property or other assets of such Person.
"Debt" shall not include a reimbursement obligation under either a standby
letter of credit or a performance bond to the extent such reimbursement
obligation is contingent or (ii) in the case of the Company, a Guarantee of up
to $15,000,000 of revolving debt of Hawaii Sugar & Transportation Cooperative.
"Debt to EBITDA Ratio" shall mean, as at any time of determination
thereof, the ratio (expressed as a percentage) of (i) all Debt of the Company
and Subsidiaries on a consolidated basis to (ii) EBITDA for the four consecutive
fiscal quarter period then most recently ended.
"Delayed Delivery Fee" shall have the meaning specified in paragraph
2B(8)(iii).
"Discontinued Operations" shall have the meaning provided pursuant to
GAAP, provided that any sale or condemnation of real estate which is treated as
a discontinued operation pursuant to GAAP shall be treated as a sale of a
continuing operation to the extent the net proceeds of such sale or condemnation
have been reinvested in real estate within twelve months from the date of sale
or condemnation.
"EBITDA" shall mean, for any period, Consolidated Net Income Before
Taxes for such period plus, to the extent deducted in the calculation thereof,
Consolidated Interest Expense, depreciation and amortization.
"Environmental and Safety Laws" shall mean all Federal, state and local
laws, regulations and ordinances, relating to the discharge, handling,
disposition or treatment of Hazardous Materials and other substances or the
protection of the environment or of employee health and safety, including,
without limitation, CERCLA, the Hazardous Materials Transportation Act
(49 U.S.C. Section 1801 et. seq.), the Resource Conservation and Recovery Act
(42 U.S.C. Section 6901 et. seq.), the Federal Water Pollution Control Act (33
U.S.C. Section 1251 et. seq.), the Clean Air Act (42 U.S.C. Section 7401 et.
seq.), the Toxic Substances Control Act (15 U.S.C. Section 2601 et. seq.),
the Occupational Safety and Health Act (29 U.S.C. Section 651 et. seq.) and the
Emergency Planning and Community Right-To-Know Act (42 U.S.C. Section 11001 et.
seq.), each as the same may be amended and supplemented.
"Environmental Liabilities and Costs" shall mean, as to any Person, all
liabilities, obligations, responsibilities, remedial actions, losses, damages,
punitive damages, consequential damages, treble damages, contribution, cost
recovery, costs and expenses (including all fees, disbursements and expenses of
counsel, expert and consulting fees, and costs of investigation and feasibility
studies), fines, penalties, sanctions and interest incurred as a result of any
claim or demand, by any Person, whether based in contract, tort, implied or
express warranty, strict liability, criminal or civil statute, permit, order or
agreement with any Federal, state or local governmental authority or other
Person, arising from environmental, health or safety conditions, or the release
or threatened release of a contaminant, pollutant or Hazardous Material into the
environment, resulting from the operations of such Person or its subsidiaries,
or breach of any Environmental and Safety Law or for which such Person or its
subsidiaries is otherwise liable or responsible.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended.
"ERISA Affiliate" shall mean any corporation which is a member of the
same controlled group of corporations as the Company within the meaning of
section 414(b) of the Code, or any trade or business which is under common
control with the Company within the meaning of section 414(c) of the Code.
"Event of Default" shall mean any of the events specified in paragraph
7A, provided that there has been satisfied any requirement in connection with
such event for the giving of notice, or the lapse of time, or the happening of
any further condition, event or act, and "Default" shall mean any of such
events, whether or not any such requirement has been satisfied.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Facility" shall have the meaning specified in paragraph 2B(1).
"Facility Fee " shall have the meaning specified in paragraph 2B(8)(i).
"FASB" shall mean the Financial Accounting Standards Board of the
American Institute of Certified Public Accountants, or any successor body.
"GAAP" shall have the meaning provided in paragraph 10C.
"Guarantee" shall mean, without duplication, any obligation, contingent
or otherwise, of any Person guaranteeing or having the economic effect of
guaranteeing any Debt or other obligation of any other Person (the primary
obligor) in any manner, directly or indirectly, and including any obligation:
(i) to make any loan, advance or capital contribution, or for
the purchase of any property from, any Person, in each case for the
purpose of enabling such Person to maintain working capital, net worth
or any other balance sheet condition or to pay debts, dividends or
expenses except for advances, deposits and initial payments made in the
usual and ordinary course of business for the purchase or acquisition
of property or services; or
(ii) to purchase materials, supplies or other property or
services if such obligation requires that payment for such materials,
supplies or other property or services be made regardless of whether or
not delivery of such materials, supplies or other property or services
is ever made or tendered; or
(iii) to rent or lease (as lessee) any real or personal
property (except for leases in effect on August 2, 1996) if such
obligation is absolute and unconditional under conditions not
customarily found in commercial leases then in general use; or
(iv) of any partnership or joint venture in which such Person
is a general partner or joint venturer if such obligation is not
expressly non-recourse to such Person.
"Hazardous Materials" shall mean (a) any material or substance defined
as or included in the definition of "hazardous substances," "hazardous wastes,"
"hazardous materials," "toxic substances" or any other formulations intended to
define, list or classify substances by reason of their deleterious properties,
(b) any oil, petroleum or petroleum derived substance, (c) any flammable
substances or explosives, (d) any radioactive materials, (e) asbestos in any
form, (f) electrical equipment that contains any oil or dielectric fluid
containing levels of polychlorinated biphenyls in excess of fifty parts per
million, (g) pesticides or (h) any other chemical, material or substance,
exposure to which is prohibited, limited or regulated by any governmental agency
or authority or which may or could pose a hazard to the health and safety of
persons in the vicinity thereof.
"Hedge Treasury Note(s)" shall mean, with respect to any Accepted Note,
the United States Treasury Note or Notes whose duration (as determined by
Prudential) most closely matches the duration of such Accepted Note.
"Hostile Tender Offer" shall mean, with respect to the use of proceeds
of any Note, any offer to purchase, or any purchase of, shares of capital stock
of any corporation or equity interests in any other entity, or securities
convertible into or representing the beneficial ownership of, or rights to
acquire, any such shares or equity interests, if such shares, equity interests,
securities or rights are of a class which is publicly traded on any securities
exchange or in any over-the-counter market, other than purchases for portfolio
investment purposes of such shares, equity interests, securities or rights
which, together with any shares, equity interests, securities or rights then
owned, represent less than 5% of the equity interests or beneficial ownership of
such corporation or other entity, and such offer or purchase has not been duly
approved by the board of directors of such corporation or the equivalent
governing body of such other entity prior to the date on which the Company makes
the Request for Purchase of such Note.
"including" shall mean, unless the context clearly requires otherwise,
"including without limitation".
"Institutional Investor" shall mean an insurance company, bank, pension
fund, investment company, "qualified institutional buyer" (as such term is
defined under Rule 144A promulgated under the Securities Act, or any successor
law, rule or regulation), "accredited investor" (as such term is defined under
Regulation D promulgated under the Securities Act, or any successor law, rule or
regulation) or other Person with assets in excess of $50,000,000 that invests in
securities for its own account or as a dealer.
"Intangibles" shall mean any Intellectual Properties, goodwill
(including any amounts, however designated, representing the cost of acquisition
of business and investments in excess of underlying tangible assets),
unamortized debt discount and expense, deferred research and development costs,
any write-up of asset value after December 31, 1989 and other assets treated as
intangible assets under GAAP.
"Intellectual Properties" shall mean inventions, patents, copyrights,
trade secrets, trade names and trademarks, technologies, methods, design
drawings, software (including documentation and source code listings) processes,
applications for the same and other proprietary properties or information.
"Interest Coverage Ratio" shall mean, at any time of determination
thereof, (a) the sum of (i) Consolidated Net Income Before Taxes for the period
of four consecutive fiscal quarters then most recently ended and (ii)
Consolidated Interest Expense for such four fiscal quarter period, divided by
(b) Consolidated Interest Expense for such four fiscal quarter period.
"Issuance Period" shall have the meaning specified in paragraph 2B(2).
"Lien" shall mean any mortgage, deed of trust, pledge, security
interest, encumbrance, lien or charge of any kind (including any agreement to
give any of the foregoing, any purchase money mortgage, conditional sale or
other title retention agreement, any lease in the nature thereof, and the filing
of or agreement to give any financing statement (exclusive of filings for
precautionary purposes only) under the Uniform Commercial Code of any
jurisdiction).
"margin stock" shall have the meaning specified in paragraph 8I.
"Material Rights" shall have the meaning specified in paragraph 8P.
"Matson" shall mean ▇▇▇▇▇▇ Navigation Company, Inc., a wholly owned
subsidiary of the Company.
"Matson Subsidiary" shall mean any Subsidiary a majority of the Voting
Stock of which is owned by Matson, either directly or through Matson
Subsidiaries.
"Multiemployer Plan" shall mean any Plan which is a "multiemployer
plan" (as such term is defined in section 4001(a)(3) of ERISA).
"Notes" shall have the meaning specified in paragraph 1.
"Officer's Certificate" shall mean a certificate signed in the name of
the Company by an Authorized Officer of the Company.
"PBGC" shall mean the Pension Benefit Guaranty Corporation, or any
successor or replacement entity thereto under ERISA.
"Permitted Assets" shall mean (i) where any Property Sub or any assets
of a Property Sub or of the Company (other than capital stock of Matson) have
been sold or otherwise transferred, assets to be used by the Company or any
Property Sub in conducting Property Development Activities, the Property
Management Business or the food products business and (ii) in all other
instances, assets to be used in conducting Property Development Activities, the
Property Management Business, the food products business or the ocean
transportation business.
"Permitted Debt" shall mean (i) any unsecured Debt of the Company or a
Subsidiary (exclusive of Debt owed to the Company or a Subsidiary) selected by
the Company, so long as the aggregate amount of all proceeds applications from
sales or other dispositions which are made after December 31, 2000 pursuant to
the proviso appearing in clause (iv) of paragraph 6B(3) do not exceed
$100,000,000 and (ii) after the $100,000,000 basket in clause (i) has been fully
utilized, all unsecured Debt of the Company and Subsidiaries (exclusive of any
Debt owed to the Company or a Subsidiary thereof) on a pro rata basis.
--- ----
"Person" shall mean and include an individual, a partnership, a joint
venture, a corporation, a trust, a limited liability company, an unincorporated
organization and a government or any department or agency thereof.
"Plan" shall mean any "employee pension benefit plan" (as such term is
defined in section 3 of ERISA) which is or has been established or maintained,
or to which contributions are or have been made, by the Company or any ERISA
Affiliate.
"Principal Officer" shall mean the Treasurer, Chief Financial Officer
and General Counsel of the Company and any other officer of the Company whose
responsibilities include monitoring the Company's compliance with the provisions
of this Agreement.
"Priority Debt" shall mean, at any time of determination, the sum of
(i) Debt secured by Liens incurred pursuant to paragraph 6B(1)(vi), (ii) Debt of
the Company or any non-Matson Subsidiary to Matson or a Matson Subsidiary (other
than for cash management purposes in accordance with the Company's standard cash
management policies) and (iii) Debt of Subsidiaries, other than (a) Guarantees
of Debt of the Company so long as each such Subsidiary has guaranteed the Notes
and the Required Holders have confirmed in writing that they are satisfied that
such Guarantee does not subject the holders of the Notes to potentially adverse
fraudulent conveyance treatment vis-a-vis any other recipient of a Guarantee
--- - ---
from such Subsidiary, (b) Guarantees by ▇▇▇▇▇▇ and ▇▇▇▇▇▇ Subsidiaries of Debt
of ▇▇▇▇▇▇, ▇▇▇▇▇▇ Subsidiaries and third parties and (c) Debt of a non-Matson
Subsidiary to Matson or a Matson Subsidiary described in the parenthetical in
clause (ii) of this definition and (d) Debt of Matson and ▇▇▇▇▇▇ Subsidiaries
(1) of the type specified in paragraph 6B(1)(iii) or (2) that is unsecured.
"Priority Debt Limit" shall mean, at any time of determination, the sum
of (i) $20,000,000 and (ii) an amount equal to 10% of Consolidated Tangible Net
Worth at such time.
"Prohibited Transaction" shall mean any transaction described in
section 406 of ERISA which is not exempt by reason of section 408 of ERISA or
the transitional rules set forth in section 414(c) of ERISA and any transaction
described in section 4975(c) of the Code which is not exempt by reason of
section 4975(c) (2) or section 4975(d) of the Code, or the transitional rules of
section 2003(c) of ERISA.
"Property" shall mean all real property owned or leased by the Company
or any of its Subsidiaries, and all personal property including without
limitation ocean transportation vessels and hauling trucks, located thereon or
used or consumed in the operation of the business conducted thereat.
"Property Development Activities" shall mean land acquisition and
development activities of the Property Subs, the principal objective of which is
to acquire and develop real property for sale or other disposition.
"Property Management Business" shall mean the managing, leasing,
selling and purchasing of real property.
"Property Subs" shall mean A&B Properties, Inc., Kukui'ula Development
Company, Inc., South Shore Resources, Inc., South Shore Community Services,
Inc., and East Maui Irrigation Company Limited, all Hawaii corporations, and A&B
Development Company, a California corporation, all of which are wholly owned
Subsidiaries of the Company, and other non-Matson Subsidiaries that are formed
or acquired principally to engage in real property development activities.
"Prudential" shall mean Prudential Investment Management, Inc.
"Prudential Affiliate" shall mean (i) any corporation or other entity
controlling, controlled by, or under common control with, Prudential and (ii)
any managed account or investment fund which is managed by Prudential or a
Prudential Affiliate described in clause (i) of this definition. For purposes of
this definition the terms "control", "controlling" and "controlled" shall mean
the ownership, directly or through subsidiaries, of a majority of a
corporation's or other Person's Voting Stock or equivalent voting securities or
interests.
"Purchasers" shall mean, with respect to any Accepted Notes, Prudential
and/or the Prudential Affiliate(s) which are purchasing such Accepted Notes.
"Request for Purchase" shall have the meaning specified in paragraph
2B(3).
"Required Holder(s)" shall mean the holder or holders of at least 66
2/3% of the aggregate principal amount of the Notes or of a Series of Notes, as
the context may require, from time to time outstanding and, if no Notes are
outstanding, shall mean Prudential.
"Rescheduled Closing Day" shall have the meaning specified in paragraph
2B(7).
"Restricted Payments" shall have the meaning specified in paragraph 6D.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Series" shall have the meaning specified in paragraph 1.
"Significant Holder" shall mean (i) Prudential or any Prudential
Affiliate, so long as Prudential or any Prudential Affiliate shall hold any Note
or the Issuance Period has not terminated or (ii) any other holder of at least
10% of the aggregate principal amount of the Notes of any Series from time to
time outstanding.
"Significant Subsidiary" shall mean any direct or indirect Subsidiary
of the Company, the net worth of which is, on the date of determination, 5% or
more of Consolidated Tangible Net Worth.
"Subsidiary" shall mean, as to the Company, any company, whether
operating as a corporation, joint venture, partnership, limited liability
company or other entity, which is consolidated with the Company in accordance
with GAAP.
"third party" shall mean any Person other than Company and its
Subsidiaries.
"Transferee" shall mean any Institutional Investor that is the direct
or indirect transferee of all or any part of any Note purchased under this
Agreement.
"Voting Stock" shall mean any shares of stock (or comparable equity
securities) whose holders are entitled under ordinary circumstances to vote for
the election of directors (or comparable persons), irrespective of whether at
the time stock (or comparable equity securities) of any other class or classes
shall have or might have voting power by reason of the happening of any
contingency.
10C. Accounting Principles, Terms and Determinations. All references in
this Agreement to "generally accepted accounting principles" and "GAAP" shall be
deemed to refer to generally accepted accounting principles in effect in the
United States at the time of application thereof. Unless otherwise specified
herein, all accounting terms used herein shall be interpreted, all
determinations with respect to accounting matters hereunder shall be made, and
all unaudited financial statements and certificates and reports as to financial
matters required to be furnished hereunder shall be prepared, in accordance with
generally accepted accounting principles, applied on a basis consistent with the
most recent audited consolidated financial statements of the Company and its
Subsidiaries delivered pursuant to clause (ii) of paragraph 5A or, if no such
statements have been so delivered, the most recent audited financial statements
referred to in clause (i) of paragraph 8B.
11. MISCELLANEOUS.
11A. Note Payments. The Company agrees that, so long as any Purchaser
shall hold any Note, it will make payments of principal of, interest on, and any
Yield-Maintenance Amount payable with respect to, such Note, which comply with
the terms of this Agreement, by wire transfer of immediately available funds for
credit on the date due to the account or accounts of such Purchaser specified in
the purchaser schedule attached to the applicable Confirmation of Acceptance
with respect to such Note or such other account or accounts in the United States
as such Purchaser may from time to time designate in writing, notwithstanding
any contrary provision herein or in any Note with respect to the place of
payment. Each Purchaser agrees that, before disposing of any Note, it will make
a notation thereon (or on a schedule attached thereto) of all principal payments
previously made thereon and of the date to which interest thereon has been paid.
The Company agrees to afford the benefits of this paragraph 11A to any
Transferee which shall have made the same agreement as the Purchasers have made
in this paragraph 11A.
11B. Expenses. The Company agrees, whether or not the transactions
contemplated hereby shall be consummated, to pay, and save Prudential, each
Purchaser and any Transferee harmless against liability for the payment of, all
out-of-pocket expenses arising in connection with such transactions, including
(i) all document production and duplication charges and the fees and expenses of
any special counsel engaged by the Purchasers or any Transferee in connection
with this Agreement, the transactions contemplated hereby and any subsequent
proposed modification of, or proposed consent under, this Agreement, whether or
not such proposed modification shall be effected or proposed consent granted,
and (ii) the reasonable costs and expenses, including attorneys' fees, incurred
by any Purchaser or any Transferee in enforcing 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
transactions contemplated hereby or by reason of any Purchaser's or any
Transferee's having acquired any Note, including without limitation costs and
expenses incurred in any bankruptcy case. The obligations of the Company under
this paragraph 11B shall survive the transfer of any Note or portion thereof or
interest therein by any Purchaser or any Transferee and the payment of any Note.
11C. Consent to Amendments. This Agreement may be amended, and the
Company may take any action herein prohibited, or omit to perform any act herein
required to be performed by it, if the Company shall obtain the written consent
to such amendment, action or omission to act, of the Required Holder(s) of the
Notes of each Series except that, (i) with the written consent of the holders of
all Notes of a particular Series, and if an Event of Default shall have occurred
and be continuing, of the holders of all Notes of all Series, at the time
outstanding (and not without such written consents), the Notes of such Series
may be amended or the provisions thereof waived to change the maturity thereof,
to change or affect the principal thereof, or to change or affect the rate or
time of payment of interest on or any Yield-Maintenance Amount payable with
respect to the Notes of such Series, (ii) without the written consent of the
holder or holders of all Notes at the time outstanding, no amendment to or
waiver of the provisions of this Agreement shall change or affect the provisions
of paragraph 7A or this paragraph 11C insofar as such provisions relate to
proportions of the principal amount of the Notes of any Series, or the rights of
any individual holder of Notes, required with respect to any declaration of
Notes to be due and payable or with respect to any consent, amendment, waiver or
declaration, (iii) with the written consent of Prudential (and not without the
written consent of Prudential) the provisions of paragraph 2B may be amended or
waived (except insofar as any such amendment or waiver would affect any rights
or obligations with respect to the purchase and sale of Notes which shall have
become Accepted Notes prior to such amendment or waiver), and (iv) with the
written consent of all of the Purchasers which shall have become obligated to
purchase Accepted Notes of any Series (and not without the written consent of
all such Purchasers), any of the provisions of paragraphs 2B and 3 may be
amended or waived insofar as such amendment or waiver would affect only rights
or obligations with respect to the purchase and sale of the Accepted Notes of
such Series or the terms and provisions of such Accepted Notes. Each holder of
any Note at the time or thereafter outstanding shall be bound by any consent
authorized by this paragraph 11C, whether or not such Note shall have been
marked to indicate such consent, but any Notes issued thereafter may bear a
notation referring to any such consent. 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 and in the Notes, the term "this Agreement" and references
thereto shall mean this Agreement as it may from time to time be amended or
supplemented.
11D. Form, Registration, Transfer and Exchange of Notes; Transfer
Restriction. The Notes are issuable as registered notes without coupons in
denominations of at least $2,500,000, except as may be necessary to reflect any
principal amount not evenly divisible by $2,500,000. The Company shall keep at
its principal office a register in which the Company shall provide for the
registration of Notes and of transfers of Notes. Upon surrender for registration
of transfer of any Note at the principal office of the Company, the Company
shall, at its expense, execute and deliver one or more new Notes of like tenor
and of a like aggregate principal amount, registered in the name of such
transferee or transferees. At the option of the holder of any Note, such Note
may be exchanged for other Notes of like tenor and of any authorized
denominations, of a like aggregate principal amount, upon surrender of the Note
to be exchanged at the principal office of the Company. Whenever any Notes are
so surrendered for exchange, the Company shall, at its expense, execute and
deliver the Notes which the holder making the exchange is entitled to receive.
Each prepayment of principal payable on each prepayment date upon each new Note
issued upon any such transfer or exchange shall be in the same proportion to the
unpaid principal amount of such new Note as the prepayment of principal payable
on such date on the Note surrendered for registration of transfer or exchange
bore to the unpaid principal amount of such Note. No reference need be made in
any such new Note to any prepayment or prepayments of principal previously due
and paid upon the Note surrendered for registration of transfer or exchange.
Every Note surrendered for registration of transfer or exchange shall be duly
endorsed, or be accompanied by a written instrument of transfer duly executed,
by the holder of such Note or such holder's attorney duly authorized in writing.
Any Note or Notes issued in exchange for any Note or upon transfer thereof shall
carry the rights to unpaid interest and interest to accrue which were carried by
the Note so exchanged or transferred, so that neither gain nor loss of interest
shall result from any such transfer or exchange. Upon receipt of written notice
from the holder of any Note of the loss, theft, destruction or mutilation of
such Note and, in the case of any such loss, theft or destruction, upon receipt
of such holder's unsecured indemnity agreement, or in the case of any such
mutilation upon surrender and cancellation of such Note, the Company will make
and deliver a new Note, of like tenor, in lieu of the lost, stolen, destroyed or
mutilated Note. Notwithstanding anything to the contrary herein, each Purchaser
agrees, and each subsequent holder of a Note or purchaser of a participation in
a Note by its acceptance of an interest in a Note agrees, that no Note shall be
transferred to any Person which is not an Institutional Investor without the
prior consent of the Company, such consent not to be unreasonably withheld.
11E. Persons Deemed Owners; Participations. Prior to due presentment
for registration of transfer, the Company may treat the Person in whose name any
Note is registered as the owner and holder of such Note for the purpose of
receiving payment of principal of and premium, if any, and interest on such Note
and for all other purposes whatsoever, whether or not such Note shall be
overdue, and the Company shall not be affected by notice to the contrary.
Subject to the preceding sentence, the holder of any Note may from time to time
grant participations in all or any part of such Note to any Institutional
Investor on such terms and conditions as may be determined by such holder in its
sole and absolute discretion.
11F. Survival of Representations and Warranties; Entire Agreement. All
representations and warranties contained herein or made in writing by or on
behalf of the Company in connection herewith shall survive the execution and
delivery of this Agreement and the Notes, the transfer of any Note or portion
thereof or interest therein and the payment of any Note, and may be relied upon
by any Transferee, regardless of any investigation made at any time by or on
behalf of any Purchaser or Transferee. Subject to the preceding sentence, this
Agreement and the Notes embody the entire agreement and understanding between
the parties hereto with respect to the subject matter hereof and supersede all
prior agreements and understandings relating to the subject matter hereof.
11G. Successors and Assigns. All covenants and other agreements in this
Agreement contained by or on behalf of either of the parties hereto shall bind
and inure to the benefit of the respective successors and assigns of the parties
hereto (including, without limitation, any Transferee) whether so expressed or
not.
11H. Independence of Covenants. All covenants hereunder shall be given
independent effect so that if a particular action or condition is prohibited by
any one of such covenants, the fact that it would be permitted by an exception
to, or otherwise be in compliance within the limitations of, another covenant
shall not (i) avoid the occurrence of a Default or Event of Default if such
action is taken or such condition exists or (ii) in any way prejudice an attempt
by the holder of any Note to prohibit, through equitable action or otherwise the
taking of any action by the Company or any Subsidiary which would result in a
Default or Event of Default.
11I. Notices. All written communications provided for hereunder (other
than communications provided for under paragraph 2B) shall be sent by first
class mail or nationwide overnight delivery service (with charges prepaid) and
(i) if to any Purchaser, addressed as specified for such communications in the
purchaser schedule attached to the applicable Confirmation of Acceptance or at
such other address as any such Purchaser shall have specified to the Company in
writing, (ii) if to any other holder of any Note, addressed to it at such
address as it shall have specified in writing to the Company or, if any such
holder shall not have so specified an address, then addressed to such holder in
care of the last holder of such Note which shall have so specified an address to
the Company and (iii) if to the Company, addressed to it at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Chief Financial Officer (with a copy to
General Counsel) or at such other address as the Company shall have specified to
each holder of a Note in writing, provided, however, that any such communication
-------- -------
to the Company may also, at the option of the Person sending such communication,
be delivered by any other means either to the Company at its address specified
above or to any Authorized Officer of the Company. Any communication pursuant to
paragraph 2B shall be made by the method specified for such communication in
paragraph 2B, and shall be effective to create any rights or obligations under
this Agreement only if, in the case of a telephone communication, an Authorized
Officer of the party conveying the information and of the party receiving the
information are parties to the telephone call, and in the case of a
telefacsimile communication, the communication is signed by an Authorized
Officer of the party conveying the information, addressed to the attention of an
Authorized Officer of the party receiving the information, and in fact received
at the telefacsimile terminal the number of which is listed for the party
receiving the communication in the Information Schedule or at such other
telefacsimile terminal as the party receiving the information shall have
specified in writing to the party sending such information.
11J. Descriptive Headings. The descriptive headings of the several
paragraphs of this Agreement are inserted for convenience only and do not
constitute a part of this Agreement.
11K. Satisfaction Requirement. If any agreement, certificate or other
writing, or any action taken or to be taken, is, by the terms of this Agreement,
required to be satisfactory to Prudential, any Purchaser or the Required
Holder(s), the determination of such satisfaction shall be made by Prudential,
such Purchaser or the Required Holder(s), as the case may be, in the sole and
exclusive judgment (exercised in good faith) of the Person(s) making such
determination.
11L. 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 California.
11M. Change in Accounting Principles. Notwithstanding any changes in
accounting principles from those used in the preparation of the financial
statements referred to in paragraph 5B(i) and (ii) hereafter occasioned by the
promulgation of rules, regulations, pronouncements and opinions by or required
by FASB, the method of calculating or determining financial covenants, standards
or terms found in paragraphs 6 and 10 hereof shall, at the request of the
Required Holders of the Notes, remain the same as if such changes had not been
promulgated.
11N. Payments Due on Non-Business Days. Anything in this Agreement or
the Notes to the contrary notwithstanding, any payment of principal of or
interest, or Yield-Maintenance Amount payable with respect to, any Note that is
due on a date other than a Business Day shall be made on the next succeeding
Business Day, without interest for the period of extension.
11O. Severability. Any provision of this Agreement which 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 not invalidate or render
unenforceable such provision in any other jurisdiction.
11P. Severalty of Obligations. The sales of Notes to the Purchasers are
to be several sales, and the obligations of Prudential and the Purchasers under
this Agreement are several obligations. No failure by Prudential or any
Purchaser to perform its obligations under this Agreement shall relieve any
other Purchaser or the Company of any of its obligations hereunder, and neither
Prudential nor any Purchaser shall be responsible for the obligations of, or any
action taken or omitted by, any other such Person hereunder.
11Q. 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.
11R. Binding Agreement. When this Agreement is executed and delivered
by the Company and Prudential, it shall become a binding agreement between the
Company and Prudential. This Agreement shall also inure to the benefit of each
Purchaser which shall have executed and delivered a Confirmation of Acceptance,
and each such Purchaser shall be bound by this Agreement to the extent provided
in such Confirmation of Acceptance.
ALEXANDER & ▇▇▇▇▇▇▇, INC.,
a Hawaii corporation
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Its: Controller & Asst. Treasurer
-----------------------------------
By: /s/ W. ▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------
Its: President & Chief Executive Officer
-----------------------------------
The foregoing Agreement is
hereby accepted as of the
date first above written.
PRUDENTIAL INVESMENT
MANAGEMENT, INC.
By /s/ ▇. ▇. ▇▇▇▇▇
-----------------------------------
Vice President
INFORMATION SCHEDULE
Authorized Officers for Prudential
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Vice President Managing Director
PRUDENTIAL CAPITAL GROUP PRUDENTIAL CAPITAL GROUP
Four Embarcadero Center Four ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Senior Vice President Vice President
PRUDENTIAL CAPITAL GROUP PRUDENTIAL CAPITAL GROUP
Four Embarcadero Center Four ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇ ▇. ▇▇▇▇▇▇▇
Director Investment Vice President
PRUDENTIAL CAPITAL GROUP PRUDENTIAL CAPITAL GROUP
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ Center Four, 7th Floor Gateway Center Four, 7th Floor
Newark, New Jersey 07102 ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Authorized Officers for the Companies
-------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Executive Vice President, Chief Financial Controller & Assistant Treasurer
Officer &Treasurer ALEXANDER & ▇▇▇▇▇▇▇, INC.
▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, INC. ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇. ▇▇▇ ▇▇▇▇
P.O. Box 3440 Honolulu, Hawaii 96801-3440
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
EXHIBIT A
---------
ALEXANDER & ▇▇▇▇▇▇▇, INC.
SERIES ___ SENIOR NOTE
No.
ORIGINAL PRINCIPAL AMOUNT:
ORIGINAL ISSUE DATE:
INTEREST RATE:
INTEREST PAYMENT DATES:
FINAL MATURITY DATE:
PRINCIPAL PREPAYMENT DATES AND AMOUNTS:
FOR VALUE RECEIVED, the undersigned, ALEXANDER & ▇▇▇▇▇▇▇, INC. (herein
called the "Company"), a corporation organized and existing under the laws of
the State of Hawaii, hereby promises to pay to _______________, or registered
assigns, the principal sum of ________________ DOLLARS payable [on the Principal
Prepayment Dates and in the amounts specified above, and] on the Final Maturity
Date specified above [in an amount equal to the unpaid balance of the principal
amount hereof,] with interest (computed on the basis of a 360-day year--30-day
month) (a) on the unpaid balance thereof at the Interest Rate per annum
specified above, on each Interest Payment Date specified above and on the Final
Maturity Date specified above, commencing with the Interest Payment Date next
succeeding the date hereof, until the principal hereof shall have become due and
payable, and (b) on any overdue payment (including any overdue prepayment) of
principal, any overdue payment of Yield-Maintenance Amount and any overdue
payment of interest, payable on each Interest Payment Date 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) 2% over the Interest Rate specified
above or (ii) 2% over the rate of interest publicly announced by The Bank of New
York from time to time in New York City as its Prime Rate.
Payments of principal, Yield-Maintenance Amount, if any, and interest
are to be made at the main office of Bank of New York in New York City or at
such other place as the holder hereof shall designate to the Company in writing,
in lawful money of the United States of America.
This Note is one of a series of Senior Notes (herein called the
"Notes") issued pursuant to a Private Shelf Agreement, dated as of November 25,
2003 (herein called the "Agreement"), between the Company, on the one hand, and
Prudential Investment Management, Inc. and each Prudential Affiliate (as defined
in the Agreement) which becomes party thereto, on the other hand, and is
entitled to the benefits thereof.
This Note is subject to optional prepayment, in whole or from time to
time in part, on the terms specified in the Agreement.
This Note is a registered Note and, as provided in the 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 the then outstanding 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 shall not be affected by any notice to the contrary.
In case an Event of Default shall occur and be continuing, the
principal of this Note may be declared or otherwise become due and payable in
the manner and with the effect provided in the Agreement.
Capitalized terms used and not otherwise defined herein shall have the
meanings (if any) provided in the Agreement.
This Note shall be construed and enforced in accordance with the
internal law of the State of California.
ALEXANDER & ▇▇▇▇▇▇▇, INC.
By:
---------------------------------------
Title:
------------------------------------
By:
---------------------------------------
Title:
------------------------------------
EXHIBIT B
---------
[FORM OF REQUEST FOR PURCHASE]
ALEXANDER & ▇▇▇▇▇▇▇, INC.
Reference is made to the Private Shelf Agreement (the "Agreement"),
dated as of November 25, 2003 between Alexander & ▇▇▇▇▇▇▇, Inc. (the "Company"),
on the one hand, and Prudential Investment Management, Inc. and each Prudential
Affiliate which becomes party thereto, on the other hand. Capitalized terms used
and not otherwise defined herein shall have the respective meanings specified in
the Agreement.
Pursuant to paragraph 2B(3) of the Agreement, the Company hereby makes
the following Request for Purchase:
1. Aggregate principal amount of the Notes covered hereby
(the "Notes")............................$
----------------------
2. Individual specifications of the Notes:
Principal
Final Prepayment Interest
Principal Maturity Dates and Payment
Amount1 Date2 Amounts2 Period
------- ----- -------- ------
3. Use of proceeds of the Notes:
4. Proposed day for the closing of the purchase and sale of the
Notes:
------------------------------------
1 Minimum principal amount of $5,000,000.
-
2 Maturity of not more than twenty years and average life of not more
- than fifteen years.
5. The purchase price of the Notes is to be transferred to:
Name, Address
and ABA Routing Number of
Number of Bank Account
-------------- -------
6. The Company certifies (a) that the representations and
warranties contained in paragraph 8 of the Agreement are true on
and as of the date of this Request for Purchase and (b) that
there exists on the date of this Request for Purchase no Event
of Default or Default.
7. In connection with any rate quotes it may provide, Prudential
should assume a Designated Spread of ___.
Dated: ALEXANDER & ▇▇▇▇▇▇▇, INC.
By:
---------------------------
Authorized Officer
Title:
------------------------
By:
---------------------------
Authorized Officer
Title:
------------------------
EXHIBIT C
---------
[FORM OF CONFIRMATION OF ACCEPTANCE]
ALEXANDER & ▇▇▇▇▇▇▇, INC.
Reference is made to the Private Shelf Agreement (the "Agreement"),
dated as of November 25, 2003 between Alexander & ▇▇▇▇▇▇▇, Inc. (the "Company"),
on the one hand, and Prudential Investment Management, Inc. ("Prudential") and
each Prudential Affiliate which becomes party thereto, on the other hand. All
terms used herein that are defined in the Agreement have the respective meanings
specified in the Agreement.
Prudential or the Prudential Affiliate which is named below as a
Purchaser of Notes hereby confirms the representations as to such Notes set
forth in paragraph 9 of the Agreement, and agrees to be bound by the provisions
of paragraphs 2B(5) and 2B(7) of the Agreement relating to the purchase and sale
of such Notes and by the provisions of the penultimate sentence of paragraph 11A
of the Agreement.
Pursuant to paragraph 2B(5) of the Agreement, an Acceptance with
respect to the following Accepted Notes is hereby confirmed:
I. Accepted Notes: Aggregate principal amount $_________________
(A) (a) Name of Purchaser:
(b) Principal amount:
(c) Final maturity date:
(d) Principal prepayment dates and amounts:
(e) Interest rate:
(f) Interest payment period:
(g) Payment and notice instructions: As set forth on attached
Purchaser Schedule
(h) Designated Spread: ___%
(B) (a) Name of Purchaser:
(b) Principal amount:
(c) Final maturity date:
(d) Principal prepayment dates and amounts:
(e) Interest rate:
(f) Interest payment period:
(g) Payment and notice instructions: As set forth on attached
Purchaser Schedule
(h) Designated Spread: ___%
[(C), (D)... same information as above.]
II. Closing Day:
Dated: ALEXANDER & ▇▇▇▇▇▇▇, INC.
By:
--------------------------
Title:
-----------------------
By:
--------------------------
Title:
-----------------------
PRUDENTIAL INVESTMENT
MANAGEMENT, INC.
By:
---------------------------
Vice President
[PRUDENTIAL AFFILIATE]
EXHIBIT D
---------
[FORM OF OPINION OF COMPANIES' SPECIAL COUNSEL]
[Date of Closing]
[Each Purchaser]
c/o Prudential Capital Group
Four ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
As special counsel to Alexander & ▇▇▇▇▇▇▇, Inc., a Hawaii corporation
(the "Company"), we are familiar with the Private Shelf Agreement, dated as of
November 25, 2003, between the Company, on the one hand, and Prudential
Investment Management, Inc. and each Prudential Affiliate which may become bound
thereby, on the other hand (the "Agreement"), pursuant to which the Company has
issued to you today its ___% Series ___ Senior Notes in the aggregate principal
amount of $________ (the "Notes"). All capitalized terms used herein that are
defined in the Agreement shall have, unless otherwise defined herein, the
respective meanings specified in the Agreement. This letter is being delivered
to you in satisfaction of the condition set forth in clause (v) of paragraph 3A
of the Agreement and with the understanding that you are purchasing the Notes in
reliance on the opinions expressed herein.
In this connection, we have examined such certificates of public
officials, certificates of officers of the Company and copies certified to our
satisfaction of documents and records of the Company, and have made such other
investigations, as we have deemed relevant and necessary as a basis for our
opinion hereinafter set forth. We have relied upon such certificates of public
officials and of officers of the Company with respect to the accuracy of
material factual matters contained therein which we have not independently
established. With respect to the opinion expressed in paragraph 3 below, we have
also relied upon the representation made by [each of] you in paragraph 9 of the
Agreement.
Based on the foregoing, it is our opinion that:
1. The Company is a corporation duly organized and validly existing in
good standing under the laws of the State of Hawaii, with the corporate power,
authority and legal right to conduct its business as presently conducted.
2. The Company has the full corporate power, authority and legal right
to execute and deliver the Agreement and the Notes and to perform and observe
its obligations thereunder.
3. The Agreement and the Notes have been duly authorized by all
requisite corporate action on the part of the Company and have been duly
executed and delivered by authorized officers of the Company and constitute the
legal, valid and binding obligations of the Company, enforceable against the
Company in accordance with their respective terms, except as enforceability may
be (A) limited by bankruptcy, insolvency, reorganization, moratorium and other
similar laws affecting the enforcement of creditors' rights generally and (B)
subject to the application of general principles of equity.
4. The execution and delivery of the Agreement and the Notes by the
Company do not, and the performance and observance of the terms thereof will
not, breach, conflict with or contravene any provisions in the articles of
incorporation or by-laws of the Company or any provision of any material law or
regulation applicable to the Company or its properties or other assets.
5. The execution and delivery of the Agreement and the Notes do not,
and the performance and observance of the terms thereof will not, (A) conflict
with, (B) result in any breach of the terms, conditions or provisions of, (C)
constitute a default under or violation of, or (D) result in or permit the
creation or imposition of any Liens upon any of the properties or other assets
of the Company pursuant to, any material order, judgment, decree, indenture,
mortgage or any other material agreement or instrument, known to us from our
examination of the certificates of officers referred to hereinabove, to which
the Company is a party, or by which any of its properties or other assets are
bound.
6. The issuance, sale and delivery of the Notes to you is an exempt
transaction under the Securities Act of 1933, as amended, and does not require
the registration of the Notes under such Act, nor is qualification of an
indenture in respect thereof required under the Trust Indenture Act of 1939, as
amended.
7. The Company is not (A) an "investment company" within the meaning of
the Investment Company Act of 1940, as amended or (B) a "public utility" within
the meaning of the Federal Power Act, as amended.
8. The Company is not subject to regulation under the Public Utility
Holding Company Act of 1935, as amended.
9. The extension, arranging and obtaining of the credit represented by
the Notes does not result in any violation of Regulation U or X of the Board of
Governors of the Federal Reserve System.
We render no opinion as to matters involving the laws of any
jurisdiction other than the State of Hawaii, the Federal laws of the United
States of America and judicial interpretations thereof. We have assumed, for the
purposes of this opinion, that Hawaii law would be the same in all material
respects as California law, the governing law selected in the Agreement, and we
are not aware of any differences between California and Hawaii law that would
materially affect the opinions contained herein.
This opinion is rendered solely for your benefit, and may not be relied
upon by any other Person without our prior written consent, except that you may
provide this opinion to regulatory authorities for review should they so request
or in connection with their normal examinations or to a prospective Transferee
for review but such Person may not rely upon this opinion without our prior
written consent.
Very truly yours,
Schedule 5A
-----------
INDEPENDENT AUDITORS' REPORT
To the Board of Directors of
Alexander & ▇▇▇▇▇▇▇, Inc.
We have audited, in accordance with generally accepted auditing standards, the
consolidated financial statements of Alexander & ▇▇▇▇▇▇▇, Inc. and its
subsidiaries (the "Companies") for the year ended _____________, and have issued
our report thereon dated _______________________.
In connection with our audit, nothing came to our attention that caused us to
believe that the Companies were not in compliance with the terms, covenants,
provisions, or conditions of paragraphs 6 and 7 of the Private Shelf Agreement
dated as of November 25, 2003, with Prudential Investment Management, Inc.,
insofar as they relate to accounting matters. However, our audit was not
directed primarily toward obtaining knowledge of such noncompliance.
This report is intended solely for the information, benefit and use of (i) the
board of directors and management of Alexander & ▇▇▇▇▇▇▇, Inc., (ii) The
Prudential Insurance Company of America and (iii) other holders of notes issued
under the above-referenced Private Shelf Agreement, the Private Shelf Agreement
dated April 25, 2001 and the Private Shelf Agreement dated August 2, 1996, and
should not be used for any other purpose.
[DATE]
SCHEDULE 6B(1)
--------------
(Liens in existence other than those specified in
paragraphs 6B(1) (i) - 6B(1) (iv))
1. Claims by native Hawaiians or others (excluding lenders to the
Company or its Subsidiaries) to lands owned by the Company or its
Subsidiaries in the State of Hawaii, or to rights in such lands.
2. Kuleanas that may be present in respect of lands owned in
--------
whole or in part by the Company or its Subsidiaries in the State of
Hawaii.
The foregoing are not expected to have any material adverse effect on the
ownership or use by the Company and its Subsidiaries of their properties.
SCHEDULE 8G
-----------
1. Third Amended and Restated Revolving Credit and Term Loan
Agreement, effective as of November 30, 2001, among Alexander &
▇▇▇▇▇▇▇, Inc., First Hawaiian Bank, and the other Banks party
thereto.
2. Revolving Credit Agreement between Alexander & ▇▇▇▇▇▇▇, Inc.
A&B-Hawaii, Inc., and First Hawaiian Bank, dated December 30,
1993, as amended annually from 1994 through 2003.
3. Private Shelf Agreement between Alexander & ▇▇▇▇▇▇▇, Inc. and
Prudential Insurance Company of America, dated as of April 25,
2001, as amended.
4. Private Shelf Agreement between Alexander & ▇▇▇▇▇▇▇, Inc.,
A&B-Hawaii, Inc. and Prudential Insurance Company of America,
dated as of August 2, 1996, as amended.
5. Note Agreement among Alexander & ▇▇▇▇▇▇▇, Inc., A&B-Hawaii, Inc.
and The Prudential Insurance Company of America, dated as of June
4, 1993, as amended.
