EXHIBIT 10.27
$200,000,000
AmeriCredit Corp.
97/8% Senior Notes due 2006
PURCHASE AGREEMENT
------------------
April 15, 1999
Xxxxxxx Xxxxx Xxxxxx Inc.
Bear, Xxxxxxx & Co. Inc.
ING Baring Xxxxxx Xxxx LLC
c/o Xxxxxxx Xxxxx Barney Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
AmeriCredit Corp., a Texas corporation (the "Company"), proposes, upon
the terms and conditions set forth herein, to issue and sell to you, as the
initial purchasers (the "Initial Purchasers"), $200,000,000 in aggregate
principal amount of its 97/8% Series A Senior Notes due 2006 (the "Series A
Notes"). The Company's obligations under the Series A Notes, including the due
and punctual payment of principal and interest on the Series A Notes, will be
unconditionally guaranteed (the "Series A Subsidiary Guarantees") by each of
AmeriCredit Financial Services, Inc., a Delaware corporation, ACF Investment
Corp., a Delaware corporation, Americredit Corporation of California, a
California corporation, AmeriCredit Management Company, a Delaware corporation
(collectively, the "United States Guarantors"), AmeriCredit Financial Services
of Canada Ltd., a Canadian corporation chartered in the Province of Ontario (the
"Canadian Guarantor" and, together with the United States Guarantors, the
"Guarantors"). As used herein, the term "Series A Notes" shall include the
Series A Subsidiary Guarantees thereof by the Guarantors, unless the context
otherwise requires. The Guarantors and AmeriCredit Funding Corp., a Delaware
corporation, AmeriCredit Warehouse Trust, a Delaware business trust, AFS Funding
Corp., a Nevada corporation, and CP Funding Corp., a Nevada corporation, are
collectively referred to herein as the "Subsidiaries." The Series A Notes will
(i) have the terms and provisions which are summarized in the Offering
Memorandum (as defined herein), (ii) be in the forms specified by the Initial
Purchasers pursuant to Section 3 hereof, and (iii) be issued pursuant to the
provisions of an Indenture, to be dated as of April 20, 1999 (the "Indenture"),
between the Company, the Guarantors and Bank One, N.A., as Trustee (the
"Trustee").
The Company and the Guarantors wish to confirm as follows their
agreement with you the Initial Purchasers in connection with the purchase and
resale of the Series A Notes.
1. Preliminary Offering Memorandum and Offering Memorandum. The
Series A Notes will be offered and sold to the Initial Purchasers without
registration under the Securities Act of 1933, as amended (the "Act"), in
reliance on an exemption pursuant to Section 4(2) under the Act. The Company
and the Guarantors have prepared a preliminary offering memorandum, dated April
9, 1999
(the "Preliminary Offering Memorandum"), and an offering memorandum, dated April
15, 1999 (the "Offering Memorandum"), setting forth information regarding the
Company, the Guarantors, the Series A Notes and the Series B Notes (as defined
herein). Any references herein to the Preliminary Offering Memorandum and the
Offering Memorandum shall be deemed to include all amendments and supplements
thereto. The Company and the Guarantors hereby confirm that they have authorized
the use of the Preliminary Offering Memorandum and the Offering Memorandum in
connection with the offering and resale of the Series A Notes by the Initial
Purchasers.
The Company and the Guarantors understand that the Initial Purchasers
propose to make offers (the "Exempt Resales") of the Series A Notes purchased by
the Initial Purchasers hereunder only on the terms set forth in the Offering
Memorandum, and Section 2 hereof, as soon as the Initial Purchasers deem
advisable after this Agreement has been executed and delivered, solely to
persons whom the Initial Purchasers reasonably believe to be "qualified
institutional buyers" as defined in Rule 144A under the Act (referred to herein
as "QIBs" or "Eligible Purchasers").
It is understood and acknowledged that upon original issuance thereof,
and until such time as the same is no longer required under the applicable
requirements of the Act, the Series A Notes (and all securities issued in
exchange therefor, in substitution thereof) shall bear the following legend:
"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER XXXXXXX 0 XX XXX XXXXXX XXXXXX SECURITIES ACT OF 1933
(THE "SECURITIES ACT"), AND THE SECURITY EVIDENCED HEREBY MAY
NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE
OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM.
EACH PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY
NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM
THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY
RULE 144A THEREUNDER. THE HOLDER OF THE SECURITY EVIDENCED
HEREBY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) SUCH
SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED,
ONLY (1) (a) TO A PERSON WHO THE SELLER REASONABLY BELIEVES
IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (b) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (c) OUTSIDE
THE UNITED STATES TO A NON-U.S. PERSON IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT, OR (d)
IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION
OF COUNSEL IF THE COMPANY SO REQUESTS), (2) TO THE COMPANY,
OR (3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND,
IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE
JURISDICTION AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT
HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE
SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH
IN (A) ABOVE."
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It is also understood and acknowledged that holders (including
subsequent transferees) of the Series A Notes will have the registration rights
set forth in the registration rights agreement (the "Registration Rights
Agreement"), to be dated the Closing Date, in substantially the form of Exhibit
A hereto, for so long as such Series A Notes constitute "Transfer Restricted
Securities" (as defined in the Registration Rights Agreement). Pursuant to the
Registration Rights Agreement, the Company will agree to file with the
Securities and Exchange Commission under the circumstances set forth therein,
(i) a registration statement under the Act relating to the Company's 97/8%
Series B Notes due 2006 (the "Series B Notes") and the guarantees thereof (the
"Series B Subsidiary Guarantees") by the Guarantors to be offered in exchange
for the Series A Notes (the "Registered Exchange Offer") and (ii) under certain
circumstances, a shelf registration statement pursuant to Rule 415 under the Act
relating to the resale by certain holders of the Series A Notes, and to use its
best efforts to cause such registration statements to be declared effective. As
used herein, the term "Series B Notes" shall include the Series B Subsidiary
Guarantees thereof by the Guarantors, unless the context otherwise requires and
the Series A Notes and the Series B Notes, are hereinafter referred to
collectively as the "Notes." This Agreement, the Indenture, the Notes, the
Series A Subsidiary Guarantees, the Series B Subsidiary Guarantees and the
Registration Rights Agreement are hereinafter referred to collectively as the
"Operative Documents."
2. Agreements to Sell, Purchase and Resell. (a) The Company and the
Guarantors hereby agree, on the basis of the representations, warranties and
agreements of the Initial Purchasers contained herein and subject to all the
terms and conditions set forth herein, to issue and sell to the Initial
Purchasers and, upon the basis of the representations, warranties and agreements
of the Company and the Guarantors herein contained and subject to all the terms
and conditions set forth herein, each Initial Purchaser agrees, severally and
not jointly, to purchase from the Company, at a purchase price of 97.25% of the
principal amount thereof, the principal amount of Series A Notes set forth
opposite the name of such Initial Purchaser in Schedule I hereto. The Company
and the Guarantors shall not be obligated to deliver any of the securities to be
delivered hereunder except upon payment for all of the securities to be
purchased as provided herein.
(b) Each of the Initial Purchasers hereby represents and warrants to
the Company and the Guarantors that it will offer the Series A Notes for sale
upon the terms and conditions set forth in this Agreement and in the Offering
Memorandum. Each of the Initial Purchasers hereby represents and warrants to,
and agrees with, the Company and the Guarantors that such Initial Purchaser (i)
is either a QIB or an institutional "accredited investor," as defined in Rule
501(a)(1), (2), (3) and (7) under the Act, in either case with such knowledge
and experience in financial and business matters as are necessary in order to
evaluate the merits and risks of an investment in the Series A Notes; (ii) is
purchasing the Series A Notes pursuant to a private sale exempt from
registration under the Act; (iii) in connection with the Exempt Resales, will
solicit offers to buy the Notes only from, and will offer to sell the Notes only
to, the Eligible Purchasers in accordance with this Agreement and on the terms
contemplated by the Offering Memorandum; and (iv) will not offer or sell the
Notes, nor has it offered or sold the Notes by, or otherwise engaged in, any
form of general solicitation or general advertising (within the meaning of
Regulation D; including, but not limited to, advertisements, articles, notices
or other communications published in any newspaper, magazine, or similar medium
or broadcast over television or radio, or any seminar or meeting whose attendees
have been invited by any general solicitation or general advertising) in
connection with the offering of the Series A Notes. The Initial Purchasers have
advised the Company that they will offer the Series A Notes to Eligible
Purchasers at a price initially equal to 100.00% of the principal amount
thereof, plus accrued interest, if any, from the date of issuance of the Series
A Notes. Such price may be changed by the Initial Purchasers at any time
thereafter without notice.
Each of the Initial Purchasers understands that the Company and the
Guarantors and, for purposes of the opinions to be delivered to the Initial
Purchasers pursuant to Sections 7(d) and 7(h) hereof, counsel to the Company and
counsel to the Initial Purchasers, will rely upon the accuracy and
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truth of the foregoing representations, warranties and agreements and the
Initial Purchasers hereby consents to such reliance.
3. Delivery of the Series A Notes and Payment Therefor. Delivery to
the Initial Purchasers of and payment for the Series A Notes shall be made at
the office of Jenkens & Xxxxxxxxx, P.C., 0000 Xxxx Xxxxxx, Xxxxxx, XX, at 9:00
A.M., New York City time, on April 20, 1999 (the "Closing Date"). The place of
closing for the Series A Notes and the Closing Date may be varied by agreement
between the Initial Purchasers and the Company.
The Series A Notes will be delivered to the Initial Purchasers against
payment of the purchase price therefor in immediately available funds. The
Series A Notes will be evidenced by a single global security in definitive form
(the "Global Note") and/or by additional definitive securities, and will be
registered, in the case of the Global Note, in the name of Cede & Co. as nominee
of The Depository Trust Company ("DTC"), and in the other cases, in such names
and in such denominations as the Initial Purchasers shall request prior to 9:30
A.M., New York City time, on the second business day preceding the Closing Date.
The Series A Notes to be delivered to the Initial Purchasers shall be made
available to the Initial Purchasers in New York City for inspection and
packaging not later than 9:30 A.M., New York City time, on the business day next
preceding the Closing Date.
4. Agreements of the Company and the Guarantors. The Company and the
Guarantors jointly and severally agree with each Initial Purchaser as follows:
(a) The Company and the Guarantors will furnish to the Initial
Purchasers, without charge, as of the date of the Offering Memorandum, such
number of copies of the Offering Memorandum as may then be amended or
supplemented as they may reasonably request.
(b) The Company and the Guarantors will not make any amendment or
supplement to the Preliminary Offering Memorandum or to the Offering Memorandum
of which the Initial Purchasers shall not previously have been advised or to
which they shall reasonably object after being so advised.
(c) Prior to the execution and delivery of this Agreement, the
Company and the Guarantors shall have delivered or will deliver to the Initial
Purchasers, without charge, in such quantities as the Initial Purchasers shall
have requested or may hereafter reasonably request, copies of the Preliminary
Offering Memorandum. The Company and each of the Guarantors consent to the use,
in accordance with the securities or Blue Sky laws of the jurisdictions in which
the Series A Notes are offered by the Initial Purchasers and by dealers, prior
to the date of the Offering Memorandum, of each Preliminary Offering Memorandum
so furnished by the Company and the Guarantors. The Company and each of the
Guarantors consent to the use of the Offering Memorandum in accordance with the
securities or Blue Sky laws of the jurisdictions in which the Series A Notes are
offered by the Initial Purchasers and by all dealers to whom Series A Notes may
be sold, in connection with the offering and sale of the Series A Notes.
(d) If, at any time prior to completion of the distribution of the
Series A Notes by the Initial Purchasers to Eligible Purchasers, any event shall
occur that in the judgment of the Company, any of the Guarantors or in the
opinion of counsel for the Initial Purchasers should be set forth in the
Offering Memorandum in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it is necessary
to supplement or amend the Offering Memorandum in order to comply with any law,
the Company and the Guarantors will forthwith prepare an appropriate supplement
or amendment thereto or such document, and will expeditiously furnish to the
Initial Purchasers and dealers a reasonable number of copies thereof.
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(e) The Company and each of the Guarantors will cooperate with the
Initial Purchasers and with their counsel in connection with the qualification
of the Series A Notes for offering and sale by the Initial Purchasers and by
dealers under the securities or Blue Sky laws of such jurisdictions as the
Initial Purchasers may designate and will file such consents to service of
process or other documents necessary or appropriate in order to effect such
qualification; provided, that in no event shall the Company or any of the
Guarantors be obligated to qualify to do business in any jurisdiction where it
is not now so qualified or to take any action which would subject it to service
of process in suits, other than those arising out of the offering or sale of the
Series A Notes, in any jurisdiction where it is not now so subject.
(f) So long as any of the Notes are outstanding, the Company and the
Guarantors will furnish to the Initial Purchasers (i) as soon as available, a
copy of each report of the Company mailed to stockholders generally or filed
with any stock exchange or regulatory body and (ii) from time to time such other
information concerning the Company and/or the Guarantors as the Initial
Purchasers may reasonably request.
(g) If this Agreement shall terminate or shall be terminated after
execution and delivery pursuant to any provisions hereof (otherwise than by
notice given by the Initial Purchasers terminating this Agreement pursuant to
Section 10 hereof) or if this Agreement shall be terminated by the Initial
Purchasers because of any failure or refusal on the part of the Company or any
of the Guarantors to comply with the terms or fulfill any of the conditions of
this Agreement, the Company and the Guarantors agree to reimburse the Initial
Purchasers for all out-of-pocket expenses (including reasonable fees and
expenses of its counsel) reasonably incurred by it in connection herewith, but
without any further obligation on the part of the Company or any of the
Guarantors for loss of profits or otherwise.
(h) The Company and the Guarantors will apply the net proceeds from
the sale of the Series A Notes to be sold by it hereunder substantially in
accordance with the description set forth in the Offering Memorandum under the
caption "Use of Proceeds."
(i) Except as stated in this Agreement and in the Preliminary
Offering Memorandum and Offering Memorandum, the Company and the Guarantors have
not taken, nor will any of them take, directly or indirectly, any action
designed to or that might reasonably be expected to cause or result in
stabilization or manipulation of the price of the Notes to facilitate the sale
or resale of the Notes. Except as permitted by the Act, the Company and the
Guarantors will not distribute any offering material in connection with the
Exempt Resales.
(j) The Company and the Guarantors will use their best efforts to
permit the Notes to be designated Private Offerings, Resales and Trading through
Automated Linkages ("PORTAL") Market securities in accordance with the rules and
regulations adopted by the National Association of Securities Dealers, Inc.
relating to trading in the PORTAL Market and to permit the Notes to be eligible
for clearance and settlement through DTC.
(k) From and after the Closing Date, so long as any of the Notes are
outstanding and are "restricted securities" within the meaning of the Rule
144(a)(3) under the Act or, if earlier, until three years after the Closing
Date, and during any period in which the Company is not subject to Section 13 or
15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
the Company and the Guarantors will furnish to holders of the Notes and
prospective purchasers of Notes designated by such holders, upon request of such
holders or such prospective purchasers, the information required to be delivered
pursuant to Rule 144A(d)(4) under the Act to permit compliance with Rule 144A in
connection with resale of the Notes.
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(l) The Company and the Guarantors have complied and will comply with
all provisions of Florida Statutes Section 517.075 relating to issuers doing
business with Cuba.
(m) The Company and the Guarantors agree not to sell, offer for sale
or solicit offers to buy or otherwise negotiate in respect of any security (as
defined in the Act) that would be integrated with the sale of the Series A Notes
in a manner that would require the registration under the Act of the sale to the
Initial Purchasers or the Eligible Purchasers of the Series A Notes.
(n) The Company and the Guarantors agree to comply with all the terms
and conditions of the Registration Rights Agreement and all agreements set forth
in the representation letters of the Company and the Guarantors to DTC relating
to the approval of the Notes by DTC for "book entry" transfer.
(o) The Company and the Guarantors agree to cause the Exchange Offer,
if available, to be made in the appropriate form, as contemplated by the
Registration Rights Agreement, to permit registration of the Series B Notes to
be offered in exchange for the Series A Notes, and to comply with all applicable
federal and state securities laws in connection with the Registered Exchange
Offer.
(p) The Company and the Guarantors agree that prior to any
registration of the Notes pursuant to the Registration Rights Agreement, or at
such earlier time as may be required, the Indenture shall be qualified under the
Trust Indenture Act of 1939 (the "1939 Act") and any necessary supplemental
indentures will be entered into in connection therewith.
(q) The Company and the Guarantors will not voluntarily claim, and
will resist actively all attempts to claim, the benefit of any usury laws
against holders of the Notes.
(r) The Company and the Guarantors will do and perform all things
required or necessary to be done and performed under this Agreement by them
prior to the Closing Date, and to satisfy all conditions precedent to the
Initial Purchasers' obligations hereunder to purchase the Series A Notes.
5. Representations and Warranties of the Company and each of the
Guarantors. The Company and each of the Guarantors, represent and warrant to
each of the Initial Purchasers that:
(a) The Preliminary Offering Memorandum and Offering Memorandum with
respect to the Series A Notes have been prepared by the Company and the
Guarantors for use by the Initial Purchasers in connection with the Exempt
Resales. No order or decree preventing the use of the Preliminary Offering
Memorandum or the Offering Memorandum, or any order asserting that the
transactions contemplated by this Agreement are subject to the registration
requirements of the Act has been issued and no proceeding for that purpose has
commenced or is pending or, to the knowledge of the Company or any of the
Guarantors, is contemplated.
(b) The Preliminary Offering Memorandum and the Offering Memorandum
as of their respective dates and the Offering Memorandum as of the Closing Date,
did not or will not at any time contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, except that this representation and
warranty does not apply to statements in or omissions from the Preliminary
Offering Memorandum and Offering Memorandum made in reliance upon and in
conformity with information relating to the Initial Purchasers furnished to the
Company in writing by or on behalf of the Initial Purchasers expressly for use
therein.
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(c) The market-related and customer-related data and estimates
included under the captions "Offering Memorandum Summary-The Company" and
"Business-Market and Competition" in the Preliminary Offering Memorandum and the
Offering Memorandum are based on or derived from sources which the Company
believes to be reliable and accurate.
(d) The Indenture has been duly and validly authorized by the Company
and the Guarantors, and upon its execution and delivery and, assuming due
authorization, execution and delivery by the Trustee, will constitute the valid
and binding agreement of the Company and the Guarantors, enforceable against the
Company and the Guarantors in accordance with its terms, subject to the
qualification that the enforceability of the Company's and the Guarantors'
obligations thereunder may be limited by bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium, and other laws relating to or affecting
creditors' rights generally and by general equitable principles; no
qualification of the Indenture under the 1939 Act is required in connection with
the offer and sale of the Series A Notes contemplated hereby or in connection
with the Exempt Resales.
(e) The Series A Notes have been duly and validly authorized by the
Company and when duly executed by the Company in accordance with the terms of
the Indenture and, assuming due authentication of the Series A Notes by the
Trustee, upon delivery to the Initial Purchasers against payment therefor in
accordance with the terms hereof, will have been validly issued and delivered,
and will constitute valid and binding obligations of the Company entitled to the
benefits of the Indenture, enforceable against the Company in accordance with
their terms, subject to the qualification that the enforceability of the
Company's obligations thereunder may be limited by bankruptcy, fraudulent
conveyance, insolvency, reorganization, moratorium, and other laws relating to
or affecting creditors' rights generally and by general equitable principles.
(f) The Series B Notes have been duly and validly authorized by the
Company and if and when duly issued and authenticated in accordance with the
terms of the Indenture and delivered in accordance with the Exchange Offer
provided for in the Registration Rights Agreement, will constitute valid and
binding obligations of the Company entitled to the benefits of the Indenture,
enforceable against the Company in accordance with their terms, subject to the
qualification that the enforceability of the Company's obligations thereunder
may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium, and other laws relating to or affecting creditors' rights generally
and by general equitable principles.
(g) The Series A Subsidiary Guarantees have been duly and validly
authorized by the Guarantors and when duly executed and delivered by the
Guarantors in accordance with the terms of the Indenture and upon the due
execution, authentication and delivery of the Series A Notes in accordance with
the Indenture and the issuance of the Series A Notes in the sale to the Initial
Purchasers contemplated by this Agreement, will constitute valid and binding
obligations of the Guarantors, enforceable against the Guarantors in accordance
with their terms, subject to the qualification that the enforceability of the
Guarantors' obligations thereunder may be limited by bankruptcy, fraudulent
conveyance, insolvency, reorganization, moratorium, and other laws relating to
or affecting creditors' rights generally and by general equitable principles.
(h) The Series B Subsidiary Guarantees have been duly and validly
authorized by the Guarantors and if and when duly executed and delivered by the
Guarantors in accordance with the terms of the Indenture and upon the due
execution and authentication of the Series B Notes in accordance with the
Indenture and the issuance and delivery of the Series B Notes in the Exchange
Offer contemplated by the Registration Rights Agreement, will constitute valid
and binding obligations of the Guarantors, enforceable against the Guarantors in
accordance with their terms, subject to the qualification that the
enforceability of the Guarantors' obligations thereunder may be limited by
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bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and
other laws relating to or affecting creditors' rights generally and by general
equitable principles.
(i) The Company, AmeriCredit Financial Services, Inc., AmeriCredit
Management Company and ACF Investment Corp. (collectively the "Borrowers"), have
entered into an agreement (the "Credit Agreement Amendment"), dated as of April
1, 1999 with Xxxxx Fargo Bank (Texas), National Association and certain other
banks named therein. The Credit Agreement Amendment became effective on April
1, 1999 and amended the credit agreement (the "Credit Agreement"), dated as of
October 3, 1997, as amended on January 21, 1998, April 30, 1998 and August 31,
1998 by and among the Borrowers and Xxxxx Fargo Bank (Texas), National
Association and certain other banks named therein, to clarify that the Credit
Agreement does not prohibit or conflict with the Company's obligations under the
Series A and Series B Notes. Americredit Corporation of California entered into
an amendment (the "Mortgage Facility Credit Agreement Amendment"), dated as of
April 15, 1999, from Chase Bank of Texas, National Association. The Mortgage
Facility Credit Agreement Amendment became effective on April 15, 1999 and
waived compliance with Section 8.11(i) of the credit agreement (the "Mortgage
Facility Credit Agreement"), dated as of February 5, 1997, as amended on June
22, 1998, February 7, 1999 and February 10, 1999 by and among the Americredit
Corporation of California and Chase Bank of Texas, National Association to
clarify that the Mortgage Facility Credit Agreement does not prohibit or
conflict with Americredit Corporation of California's guarantee of the Series A
Notes or the Series B Notes. The Company has received a waiver of that certain
Specific Guaranty (the "Canadian Subsidiary Credit Agreement Waiver"), dated as
of April 14, 1999, from The Bank of Nova Scotia. The Canadian Subsidiary Credit
Agreement Waiver became effective on April 14, 1999 and clarifies that the
Company's obligations under the Series A Notes and Series B Notes do not
conflict with the credit agreement (the "Canadian Subsidiary Credit Agreement
Waiver"), dated as of November 13, 1998 by and among the AmeriCredit Financial
Services of Canada Ltd. and The Bank of Nova Scotia.
(j) (A) The Credit Agreement and the agreements (the "Warehouse
Facility Agreements") governing each Warehouse Facility (as defined in the
Indenture) constitute the valid and binding obligation of each of the borrowers
thereto, enforceable against the borrowers in accordance with their respective
terms, subject to the qualification that the enforceability of the borrowers'
obligations thereunder may be limited by bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium, and other laws relating to or affecting
creditors' rights generally and by general equitable principles; (B) the
Borrowers will have at least $115 million of borrowings available to them under
the Credit Agreement (giving effect to the borrowing base requirements of the
Credit Agreement) after the Closing of the sale of the Series A Notes hereunder,
the receipt by the Company of the proceeds therefore and the application of such
proceeds as described under the caption "Use of Proceeds" in the Offering
Memorandum; (C) all representations and warranties made by the borrowers in (i)
Article VII of the Credit Agreement and (ii) the Warehouse Facility Agreements
are true and correct in all material respects as of the date hereof; (D) the
Mortgage Facility Credit Agreement constitutes the valid and binding obligation
of Americredit Corporation of California, enforceable against Americredit
Corporation of California in accordance with its terms, subject to the
qualification that the enforceability of Americredit Corporation of California's
obligations thereunder may be limited by bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium, and other laws relating to or affecting
creditors' rights generally and by general equitable principles; (E) all
representations and warranties made by Americredit Corporation of California in
Section 6 of the Mortgage Facility Credit Agreement are true and correct in all
material respects as of the date hereof; (F) the Canadian Subsidiary Credit
Agreement constitutes the valid and binding obligation of the AmeriCredit
Financial Services of Canada Ltd., enforceable against the AmeriCredit Financial
Services of Canada Ltd. in accordance with its terms, subject to the
qualification that the enforceability of AmeriCredit Financial Services of
Canada Ltd.'s obligations thereunder may be limited by bankruptcy, fraudulent
conveyance, insolvency, reorganization, moratorium, and other laws relating to
or affecting creditors' rights generally and by general equitable
8
principles; and (G) all representations and warranties made by AmeriCredit
Financial Services of Canada Ltd. in the Canadian Subsidiary Credit Agreement
are true and correct in all material respects as of the date hereof.
(k) The Company and the Guarantors have obtained, in writing, all
consents, waivers and amendments required under the terms of the Warehouse
Facility Agreements, the Credit Agreement, the Mortgage Facility Credit
Agreement, the Canadian Subsidiary Credit Agreement and existing Credit
Enhancement Agreements (as defined in the Indenture) necessary to ensure that
the execution and delivery of, and the performance of all of the transactions
contemplated by, the Operative Documents will not conflict with or constitute a
breach of, or a default under, the Warehouse Facility Agreements, the Credit
Agreement, the Mortgage Facility Credit Agreement, the Canadian Subsidiary
Credit Agreement or any Credit Enhancement Agreement.
(l) All the shares of capital stock of the Company outstanding prior
to the issuance of the Series A Notes have been duly authorized and validly
issued and are fully paid and nonassessable; the authorized capital stock of the
Company conforms to the description thereof under the caption "Capitalization"
in the Offering Memorandum.
(m) The Company is a corporation duly incorporated and validly
existing and in good standing under the laws of Texas with full corporate power
and authority to own, lease and operate its properties and to conduct its
business as described in the Offering Memorandum, and is duly registered and
qualified to conduct its business and is in good standing in each jurisdiction
or place where the nature of its properties or the conduct of its business
requires such registration or qualification, except where the failure so to
register or qualify or to be in good standing does not have a material adverse
effect on the condition (financial or other), business, prospects, properties,
net worth or results of operations of the Company and the Subsidiaries taken as
a whole (a "Material Adverse Effect").
(n) Neither the Company nor any of the Subsidiaries owns capital
stock of any corporation or entity (excluding interests in Company-sponsored
securitizations) other than the Subsidiaries. Each of the Subsidiaries is a
corporation duly incorporated and validly existing and in good standing under
the laws of the jurisdiction of its incorporation, with all requisite corporate
power and authority to own, lease and operate its properties and to conduct its
business as described in the Offering Memorandum, and is duly registered and
qualified to conduct its business and is in good standing in each jurisdiction
or place where the nature of its properties or the conduct of its business
requires such registration or qualification, except where the failure so to
register or qualify or be in good standing does not have a Material Adverse
Effect. All the outstanding shares of capital stock or beneficial interests of
each of the Subsidiaries have been duly authorized and validly issued, are fully
paid and nonassessable, and are wholly owned by the Company directly, or
indirectly through one of the other Subsidiaries, free and clear of any lien,
adverse claim, security interest, equity or other encumbrance, except as
specifically described in the Offering Memorandum under the Caption "Description
Of Other Debt."
(o) There are no legal or governmental proceedings pending or, to the
knowledge of the Company or any of the Guarantors, threatened, against the
Company or any of the Subsidiaries or to which the Company or any of the
Subsidiaries or to which any of their respective properties, is subject, that
are not disclosed in the Offering Memorandum and which, if adversely decided,
are reasonably likely to cause a Material Adverse Effect or to materially affect
the issuance of the Notes or the consummation of the other transactions
contemplated by the Operative Documents. The Offering Memorandum contains
accurate summaries of all material agreements, contracts, indentures, leases or
other instruments required to be described or summarized therein. Neither the
Company nor any of the
9
Subsidiaries is involved in any strike, job action or labor dispute with any
group of employees, and, to the Company's knowledge, no such action or dispute
is threatened.
(p) Neither the Company nor any of the Subsidiaries is (i) in
violation of its certificate or articles of incorporation or by-laws or other
organizational documents, or of any law, ordinance, administrative or
governmental rule or regulation applicable to the Company or any of the
Subsidiaries or of any decree of any court or governmental agency or body having
jurisdiction over the Company or any of the Subsidiaries except where any such
violation or violations in the aggregate would not have a Material Adverse
Effect or (ii) in default in the performance of any obligation, agreement or
condition contained in any bond, debenture, note or any other evidence of
indebtedness or in any material agreement, indenture, lease or other instrument
to which the Company or any of the Subsidiaries is a party or by which any of
them or any of their respective properties may be bound, except as may be
disclosed in the Offering Memorandum.
(q) None of the issuance, offer or sale of the Series A Notes, the
execution, delivery or performance by the Company and the Guarantors of this
Agreement or the other Operative Documents, compliance by the Company and the
Guarantors with the provisions hereof or thereof nor consummation by the Company
and the Guarantors of the transactions contemplated hereby or thereby (i)
requires any consent, approval, authorization or other order of, or registration
or filing with, any court, regulatory body, administrative agency or other
governmental body, agency or official (except such as may be required in
connection with the registration under the Act of the Series B Notes in
accordance with the Registration Rights Agreement, qualification of the
Indenture under the 1939 Act and compliance with the securities or Blue Sky laws
of various jurisdictions), or conflicts or will conflict with or constitutes or
will constitute a breach of, or a default under, the certificate or articles of
incorporation or bylaws, or other organizational documents, of the Company or
any of the Subsidiaries or (ii) conflicts or will conflict with or constitutes
or will constitute a breach of, or a default under any material agreement,
indenture, lease or other instrument to which the Company or any of the
Subsidiaries is a party or by which any of them or any of their respective
properties may be bound, or violates or will violate any statute, law,
regulation or filing or judgment, injunction, order or decree applicable to the
Company or any of the Subsidiaries or any of their respective properties, or
will result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or any of the Subsidiaries pursuant
to the terms of any agreement or instrument to which any of them is a party or
by which any of them may be bound or to which any of the property or assets of
any of them is subject.
(r) The accountants, PricewaterhouseCoopers LLP, who have certified
the financial statements included as part of the Offering Memorandum, are
independent public accountants under Rule 101 of the AICPA's Code of
Professional Conduct, and its interpretations and rulings.
(s) The financial statements, together with related notes forming
part of the Offering Memorandum, present fairly in all material respects the
consolidated financial position, results of operations, shareholders' equity and
cash flows of the Company and the Subsidiaries on the basis stated in the
Offering Memorandum at the respective dates or for the respective periods to
which they apply; such statements and related notes have been prepared in
accordance with generally accepted accounting principles consistently applied
throughout the periods involved, except as disclosed therein, and meet the
requirements of Regulation S-X under the Act for registration statements on Form
S-1; and the other financial and statistical information and data set forth in
the Offering Memorandum is accurately presented and, to the extent such
information and data is derived from the financial books and records of the
Company, is prepared on a basis consistent with such financial statements and
the books and records of the Company.
10
(t) The Company and the Guarantors have all requisite power and
authority to execute, deliver and perform their obligations under this Agreement
and the Registration Rights Agreement; the execution and delivery of, and the
performance by the Company and the Guarantors of their obligations under this
Agreement and the Registration Rights Agreement have been duly and validly
authorized by the Company and the Guarantors; this Agreement has been duly
executed and delivered by the Company and the Guarantors and constitutes the
valid and binding agreements of the Company and the Guarantors, enforceable
against the Company and the Guarantors in accordance with their terms, except as
the enforcement hereof and thereof may be limited by bankruptcy, insolvency or
other similar laws affecting the enforcement of creditors' rights generally and
subject to the applicability of general principles of equity, and except as
rights to indemnity and contribution hereunder and thereunder may be limited by
Federal, Canadian or state securities laws or principles of public policy; and
the Registration Rights Agreement, when duly executed and delivered by the
Company and the Guarantors, will constitute the valid and binding agreements of
the Company and the Guarantors, enforceable against the Company and the
Guarantors in accordance with their terms, except as the enforcement hereof and
thereof may be limited by bankruptcy, insolvency or other similar laws affecting
the enforcement of creditors' rights generally and subject to the applicability
of general principles of equity, and except as rights to indemnity and
contribution hereunder and thereunder may be limited by Federal, Canadian or
state securities laws or principles of public policy.
(u) Except as disclosed in, or specifically contemplated by, the
Offering Memorandum, subsequent to the date as of which such information is
given in the Offering Memorandum, neither the Company nor any of the
Subsidiaries has incurred any liability or obligation (including, without
limitation, any liability or obligation in connection with the securitization of
Receivables or Credit Enhancement Agreements (as such terms are defined in the
Indenture)), direct or contingent, or entered into any transaction, in each case
not in the ordinary course of business, that is material to the Company and the
Subsidiaries taken as a whole, and there has not been any material change in the
capital stock, or material increase in the short-term or long-term debt, of the
Company or any of the Subsidiaries or any material adverse change, or any
development involving or which would reasonably be expected to involve a
prospective material adverse change, in the condition (financial or other),
business, properties, net worth or results of operations of the Company and the
Subsidiaries taken as a whole.
(v) Each of the Company and the Subsidiaries has good and
indefeasible title to all property (real and personal) described in the Offering
Memorandum as being owned by it, free and clear of all liens, claims, security
interests or other encumbrances except such as are described in the Offering
Memorandum and all the material property described in the Offering Memorandum as
being held under lease by each of the Company and the Subsidiaries is held by it
under valid, subsisting and enforceable leases, with only such exceptions as in
the aggregate are not materially burdensome and do not interfere with the
conduct of the business of the Company and the Subsidiaries taken as a whole.
(w) Except as permitted by the Act, the Company and the Guarantors
have not distributed and, prior to the later to occur of the Closing Date and
completion of the distribution of the Series A Notes, will not distribute any
offering material in connection with the offering and sale of the Series A Notes
other than the Preliminary Offering Memorandum and Offering Memorandum.
(x) Each of the Company and the Subsidiaries has such permits,
licenses, franchises, certificates of need and other approvals or authorizations
of governmental or regulatory authorities ("Permits") as are necessary under
applicable law to own their respective properties and to conduct their
respective businesses in the manner described in the Offering Memorandum, except
to the extent that the failure to have such Permits would not have a Material
Adverse Effect; the Company and each of the Subsidiaries have fulfilled and
performed in all material respects, all their respective material obligations
11
with respect to the Permits, and no event has occurred which allows, or after
notice or lapse of time would allow, revocation or termination thereof or
results in any other material impairment of the rights of the holder of any such
Permit, subject in each case to such qualification as may be set forth in the
Offering Memorandum and except to the extent that any such revocation or
termination would not have a Material Adverse Effect; and, except as described
in the Offering Memorandum, none of the Permits contains any restriction that is
materially burdensome to the Company or any of the Subsidiaries.
(y) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurances that (i) transactions are executed
in accordance with management's general or specific authorization; (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain accountability for assets; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(z) Neither the Company nor any of the Subsidiaries nor, to the
Company's knowledge, any employee or agent of the Company or any of the
Subsidiaries has made any payment of funds of the Company or any of the
Subsidiaries or received or retained any funds in violation of any law, rule or
regulation, which violation would have a Material Adverse Effect.
(aa) Except as disclosed in the Offering Memorandum, the Company and
each of the Subsidiaries have filed all tax returns required to be filed, which
returns are true and correct in all material respects, and neither the Company
nor any of the Subsidiaries is in default in the payment of any taxes which were
payable pursuant to said returns or any assessments with respect thereto, except
where the failure to file such returns and make such payments would not have a
Material Adverse Effect.
(bb) No holder of any security of the Company or any of the
Subsidiaries has any right to request or demand registration of shares of common
stock or any other security of the Company because of the consummation of the
transactions contemplated by this Agreement or the Registration Rights
Agreement. Except as described in or contemplated by the Offering Memorandum,
there are no outstanding options, warrants or other rights calling for the
issuance of, and there are no commitments, plans or arrangements to issue, any
shares of capital stock of any of the Subsidiaries or any security convertible
into or exchangeable or exercisable for capital stock of any of the
Subsidiaries.
(cc) The Company and each of the Subsidiaries own or possess all
patents, trademarks, trademark registration, service marks, service xxxx
registrations, trade names, copyrights, licenses, inventions, trade secrets and
rights described in the Offering Memorandum as being owned by any of them or
necessary for the conduct of their respective businesses, and the Company is not
aware of any claim to the contrary or any challenge by any other person to the
rights of the Company and the Subsidiaries with respect to the foregoing.
(dd) The Company and the Guarantors are not and, upon sale of the
Series A Notes to be issued and sold thereby in accordance herewith and the
application of the net proceeds to the Company of such sale as described in the
Offering Memorandum under the caption "Use of Proceeds," will not be an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
(ee) When the Series A Notes are issued and delivered pursuant to this
Agreement, such Series A Notes will not be of the same class (within the meaning
of Rule 144A(d)(3) under the Act) as any security of the Company that is listed
on a national securities exchange registered under Section 6 of the Exchange Act
or that is quoted in a United States automated interdealer quotation system.
12
(ff) Neither the Company nor any affiliate (as defined in Rule 501(b)
of Regulation D ("Regulation D") under the Act) of the Company has directly, or
through any agent (provided that no representation is made as to the Initial
Purchasers or any person acting on its behalf), (i) sold, offered for sale,
solicited offers to buy or otherwise negotiated in respect of, any security (as
defined in the Act) which is or will be integrated with the offering and sale of
the Notes in a manner that would require the registration of the Series A Notes
under the Act or (ii) engaged in any form of general solicitation or general
advertising (within the meaning of Regulation D; including, but not limited to,
advertisements, articles, notices or other communications published in any
newspaper, magazine, or similar medium or broadcast over television or radio, or
any seminar or meeting whose attendees have been invited by any general
solicitation or general advertising) in connection with the offering of the
Series A Notes.
(gg) The Company and the Guarantors are not required to deliver the
information specified in Rule 144A(d)(4) in connection with the offering and
resale of the Series A Notes by the Initial Purchasers.
(hh) Assuming (i) that the representations and warranties in Section 2
hereof are true, (ii) the Initial Purchasers comply with the covenants set forth
in Section 2 hereof and (iii) that each person to whom the Initial Purchasers
offer, sell or deliver the Series A Notes is a QIB, the purchase and sale of the
Series A Notes pursuant hereto (including the Initial Purchasers' proposed
offering of the Series A Notes on the terms and in the manner set forth in the
Offering Memorandum and Section 2 hereof) is exempt from the registration
requirements of the Act.
(ii) The execution and delivery of this Agreement and the other
Operative Documents and the sale of the Series A Notes to the Initial Purchasers
or by the Initial Purchasers to Eligible Purchasers will not involve any
prohibited transaction within the meaning of Section 406 of ERISA or Section
4975 of the Code. The representation made by the Company and the Guarantors in
the preceding sentence is made in reliance upon and subject to the accuracy of,
and compliance with, the representations and covenants made or deemed made by
the Eligible Purchasers as set forth in the Offering Memorandum under the
section entitled "Notice to Investors."
(jj) The Company and the Subsidiaries have regular and ongoing
regulatory compliance programs and procedures that are adequate to ensure that
all requirements of applicable federal, state and local laws, and regulations
thereunder (including, without limitation, usury laws, the Federal Truth-in-
Lending Act, the Equal Credit Opportunity Act, the Fair Credit Billing Act, the
Fair Credit Reporting Act, the Fair Debt Collection Practices Act and the
Federal Trade Commission Act) with respect to Receivables owned and/or serviced
by the Company or its Subsidiaries have been complied with in all material
respects and to the Company's knowledge, all such Receivables now comply with
all such applicable legal requirements.
6. Indemnification and Contribution. (a) The Company and each
Guarantor jointly and severally agree to indemnify and hold harmless each
Initial Purchaser and each person, if any, who controls any Initial Purchaser
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act,
from and against any and all losses, claims, damages, liabilities and expenses
(including reasonable costs of investigation) arising out of or based upon any
untrue statement or alleged untrue statement of a material fact contained in the
Preliminary Offering Memorandum or Offering Memorandum, or arising out of or
based upon any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as such losses, claims, damages, liabilities or
expenses arise out of or are based upon any untrue statement or omission or
alleged untrue statement or omission which has been made therein or omitted
therefrom in reliance upon and in conformity with the information relating to
the Initial Purchasers furnished in writing to the Company by or on behalf of
the Initial Purchasers expressly for use in connection therewith; provided,
13
however, that the indemnification contained in this paragraph (a) with respect
to the Preliminary Offering Memorandum shall not inure to the benefit of any
Initial Purchaser (or to the benefit of any person controlling such Initial
Purchaser) on account of any such loss, claim, damage, liability or expense
arising from the sale of the Series A Notes by such Initial Purchaser to any
person if the untrue statement or alleged untrue statement or omission or
alleged omission of a material fact contained in the Preliminary Offering
Memorandum was corrected in the Offering Memorandum and the Initial Purchaser
sold Series A Notes to that person without sending or giving at or prior to the
written confirmation of such sale, a copy of the Offering Memorandum (as then
amended or supplemented) if the Company has previously furnished sufficient
copies thereof to the Initial Purchaser on a timely basis to permit such sending
or giving. The foregoing indemnity agreement shall be in addition to any
liability which the Company and the Guarantors may otherwise have.
(b) If any action, suit or proceeding shall be brought against the
Initial Purchasers or any person controlling the Initial Purchasers in respect
of which indemnity may be sought against the Company and the Guarantors, the
Initial Purchasers or such controlling person shall promptly notify the parties
against whom indemnification is being sought (the "indemnifying parties"), and
such indemnifying parties shall assume the defense thereof, including the
employment of counsel and payment of all fees and expenses. The Initial
Purchasers or any such controlling person shall have the right to employ
separate counsel in any such action, suit or proceeding and to participate in
the defense thereof, but the fees and expenses of such counsel shall be at the
expense of the Initial Purchasers or such controlling person unless (i) the
indemnifying parties have agreed in writing to pay such fees and expenses, (ii)
the indemnifying parties have failed to assume the defense and employ counsel,
or (iii) the named parties to any such action, suit or proceeding (including any
impleaded parties) include both the Initial Purchasers or such controlling
person and the indemnifying parties and the Initial Purchasers or such
controlling person shall have been advised in writing by its counsel that
representation of such indemnified party and any indemnifying party by the same
counsel would be inappropriate under applicable standards of professional
conduct (whether or not such representation by the same counsel has been
proposed) due to actual or potential differing interests between them (in which
case the indemnifying party shall not have the right to assume the defense of
such action, suit or proceeding on behalf of the Initial Purchasers or such
controlling person). It is understood, however, that the indemnifying parties
shall, in connection with any one such action, suit or proceeding or separate
but substantially similar or related actions, suits or proceedings in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of only one separate firm of
attorneys (in addition to any local counsel) at any time for the Initial
Purchasers and controlling persons not having actual or potential differing
interests with the Initial Purchasers or among themselves, which firm shall be
designated in writing by Xxxxxxx Xxxxx Xxxxxx Inc., and that all such fees and
expenses shall be reimbursed as they are incurred. The indemnifying parties
shall not be liable for any settlement of any such action, suit or proceeding
effected without their written consent, but if settled with such written
consent, or if there be a final judgment for the plaintiff in any such action,
suit or proceeding, the indemnifying parties agree to indemnify and hold
harmless the Initial Purchasers, to the extent provided in paragraph (a), and
any such controlling person from and against any loss, claim, damage, liability
or expense by reason of such settlement or judgment.
(c) Each Initial Purchaser, severally and not jointly, agrees to
indemnify and hold harmless the Company and the Guarantors, and their directors
and officers, and any person who controls the Company or any Guarantor within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act to the
same extent as the indemnity from the Company and the Guarantors to the Initial
Purchasers set forth in paragraph (a) hereof, but only with respect to
information relating to the Initial Purchasers furnished in writing by or on
behalf of the Initial Purchasers expressly for use in the Preliminary Offering
Memorandum or Offering Memorandum. If any action, suit or proceeding shall be
brought against the Company or the Guarantors, any of their directors or
officers, or any such controlling
14
person based on the Preliminary Offering Memorandum or Offering Memorandum, and
in respect of which indemnity may be sought against the Initial Purchasers
pursuant to this paragraph (c), the Initial Purchasers shall have the rights and
duties given to the Company and the Guarantors by paragraph (b) above (except
that if the Company and the Guarantors shall have assumed the defense thereof
the Initial Purchasers shall not be required to do so, but may employ separate
counsel therein and participate in the defense thereof, but the fees and
expenses of such counsel shall be at the Initial Purchasers' expense), and the
Company and the Guarantors, their directors and officers, and any such
controlling person shall have the rights and duties given to the Initial
Purchasers by paragraph (b) above. The foregoing indemnity agreement shall be in
addition to any liability which the Initial Purchasers may otherwise have.
(d) If the indemnification provided for in this Section 6 is
unavailable (except if inapplicable according to its terms) to an indemnified
party under paragraphs (a) or (c) hereof in respect of any losses, claims,
damages, liabilities or expenses referred to therein, then an indemnifying
party, in lieu of indemnifying such indemnified party, shall contribute to the
amount paid or payable by such indemnified party as a result of such losses,
claims, damages, liabilities or expenses (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company and the
Guarantors on the one hand and the Initial Purchasers on the other hand from the
offering of the Series A Notes, or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company and the Guarantors on the one hand and
the Initial Purchasers on the other in connection with the statements or
omissions that resulted in such losses, claims, damages, liabilities or
expenses, as well as any other relevant equitable considerations. The relative
benefits received by the Company and the Guarantors on the one hand and the
Initial Purchasers on the other shall be deemed to be in the same proportion as
the total net proceeds from the offering (before deducting expenses) received by
the Company bear to the total underwriting discounts received by the Initial
Purchasers, in each case as set forth in the table on the cover page of the
Offering Memorandum. The relative fault of the Company and the Guarantors on
the one hand and the Initial Purchasers on the other hand shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company and the Guarantors on the one
hand or by the Initial Purchasers on the other hand and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
(e) The Company, the Guarantors and the Initial Purchasers agree that
it would not be just and equitable if contribution pursuant to this Section 6
were determined by a pro rata allocation or by any other method of allocation
that does not take account of the equitable considerations referred to in
paragraph (d) above. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, liabilities and expenses referred to in
paragraph (d) above shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating any claim or defending any such action,
suit or proceeding. Notwithstanding the provisions of this Section 6, the
Initial Purchasers shall not be required to contribute any amount in excess of
the amount by which the total price of the Series A Notes underwritten by it and
distributed to the public exceeds the amount of any damages which the Initial
Purchasers have otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
(f) Any losses, claims, damages, liabilities or expenses for which an
indemnified party is entitled to indemnification or contribution under this
Section 6 shall be paid by the indemnifying
15
party to the indemnified party as such losses, claims, damages, liabilities or
expenses are incurred but only to the extent that such losses, claims, damages,
liabilities or expenses are required to be paid by an indemnified party. The
indemnity and contribution agreements contained in this Section 6 and the
representations and warranties of the Company and the Guarantors set forth in
this Agreement shall remain operative and in full force and effect, regardless
of (i) any investigation made by or on behalf of the Initial Purchasers or any
person controlling the Initial Purchasers, the Company and the Guarantors, their
directors or officers or any person controlling the Company or the Guarantors,
(ii) acceptance of any Series A Notes and payment therefor hereunder, and (iii)
any termination of this Agreement. A successor to the Initial Purchasers or any
person controlling the Initial Purchasers, or to the Company and the Guarantors,
their directors or officers or any person controlling the Company or the
Guarantors, shall be entitled to the benefits of the indemnity, contribution and
reimbursement agreements contained in this Section 6.
(g) No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
action, suit or proceeding in respect of which any indemnified party is or could
have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such action, suit or proceeding.
7. Conditions of the Initial Purchasers' Obligations. The several
obligations of the Initial Purchasers to purchase the Series A Notes hereunder
are subject to the following conditions:
(a) At the time of execution of this Agreement and on the Closing
Date, no order or decree preventing the use of the Offering Memorandum, or any
order asserting that the transactions contemplated by this Agreement are subject
to the registration requirements of the Act shall have been issued and no
proceedings for that purpose shall have been commenced or shall be pending or,
to the knowledge of the Company or any of the Guarantors, be contemplated. No
stop order suspending the sale of the Series A Notes in any jurisdiction
designated by the Initial Purchasers shall have been issued and no proceedings
for that purpose shall have been commenced or shall be pending or, to the
knowledge of the Company or any of the Guarantors, shall be contemplated.
(b) Subsequent to the date as of which information is given in the
Offering Memorandum, except as otherwise stated in the Offering Memorandum,
there shall not have occurred (i) any change, or any development involving a
prospective change, in or affecting the condition (financial or other),
business, properties, net worth, or results of operations of the Company or the
Subsidiaries not contemplated by the Offering Memorandum, which in the opinion
of the Initial Purchasers, would materially adversely affect the market for the
Series A Notes, or (ii) any event or development relating to or involving the
Company, any of its Subsidiaries or any officer or director of the Company or
any of its Subsidiaries which makes any statement made in the Offering
Memorandum untrue or which, in the opinion of the Company, the Guarantors and
their counsel or the Initial Purchasers and their counsel, requires the making
of any addition to or change in the Offering Memorandum in order to state a
material fact required by any law to be stated therein or necessary in order to
make the statements therein not misleading, if amending or supplementing the
Offering Memorandum to reflect such event or development would, in the opinion
of the Initial Purchasers, materially adversely affect the market for the Series
A Notes.
(c) The Final Offering Memorandum shall have been printed and copies
thereof distributed to the Initial Purchasers in such quantities as shall have
been previously specified by them not later than 9:00 a.m., New York City time,
on April 19, 1999, or at such later date and time as the Initial Purchasers may
approve in writing.
16
(d) The Initial Purchasers shall have received on the Closing Date an
opinion of Jenkens & Xxxxxxxxx, P.C., counsel for the Company, dated the Closing
Date and addressed to the Initial Purchasers, to the effect that:
(i) The Company is a corporation duly incorporated and validly
existing in good standing under the laws of Texas with full corporate power and
authority to own, lease and operate its properties and to conduct its business
as described in the Offering Memorandum;
(ii) Each of the Subsidiaries is a corporation duly
incorporated and validly existing and in good standing under the laws of its
jurisdiction of incorporation, with all requisite power and authority to own,
lease, and operate its properties and to conduct its business as described in
the Offering Memorandum; and all the outstanding shares of capital stock or
beneficial interests of each of the Subsidiaries have been duly authorized and
validly issued, are fully paid and nonassessable, and to the knowledge of such
counsel, are wholly owned by the Company directly, or indirectly through one of
the other Subsidiaries, free and clear of any security interest, lien, adverse
claim, equity or other encumbrance, except as specifically described in the
Offering Memorandum under the caption "Description Of Other Debt;"
(iii) The authorized capital stock of the Company is as set
forth under the caption "Capitalization" in the Offering Memorandum;
(iv) The Company and each of the Guarantors have the corporate
power and authority to enter into this Agreement and the Registration Rights
Agreement and to issue, sell and deliver the Series A Notes to be sold to the
Initial Purchasers as provided herein, and this Agreement and the Registration
Rights Agreement have been duly and validly authorized, executed and delivered
by the Company and the Guarantors and constitute the valid and binding
agreements of the Company and the Guarantors, enforceable against the Company
and the Guarantors in accordance with their terms, except (A) as enforcement of
rights to indemnity and contribution hereunder and thereunder may be limited by
Federal or state securities laws or principles of public policy and (B) subject
to the qualification that the enforceability of the Company's and the
Guarantors' obligations hereunder and thereunder may be limited by bankruptcy,
fraudulent conveyance, insolvency, reorganization, moratorium, and other laws
relating to or affecting creditors' rights generally and by general equitable
principles;
(v) The Indenture has been duly and validly authorized,
executed and delivered by the Company and the Guarantors and, assuming due
authorization, execution and delivery by the Trustee, constitutes the valid and
binding agreement of the Company and the Guarantors, enforceable against the
Company and the Guarantors in accordance with its terms, subject to the
qualification that the enforceability of the Company's and the Guarantors'
obligations thereunder may be limited by bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium, and other laws relating to or affecting
creditors' rights generally and by general equitable principles; no
qualification of the Indenture under the 1939 Act is required in connection with
the offer and sale of the Series A Notes contemplated hereby or in connection
with the Exempt Resales;
(vi) The Series A Notes have been duly and validly authorized
by the Company and when duly executed by the Company in accordance with the
terms of the Indenture and, assuming due authentication of the Series A Notes by
the Trustee, upon delivery to the Initial Purchasers against payment therefor in
accordance with the terms hereof, will have been validly issued and delivered,
and will constitute valid and binding obligations of the Company entitled to the
benefits of the Indenture, enforceable against the Company in accordance with
their terms, subject to the qualification that the enforceability of the
Company's obligations thereunder may be limited by bankruptcy,
17
fraudulent conveyance, insolvency, reorganization, moratorium, and other laws
relating to or affecting creditors' rights generally and by general equitable
principles;
(vii) The Series B Notes have been duly and validly authorized
by the Company and if and when duly issued and authenticated in accordance with
the terms of the Indenture and delivered in accordance with the Exchange Offer
provided for in the Registration Rights Agreement, will constitute valid and
binding obligations of the Company entitled to the benefits of the Indenture,
enforceable against the Company in accordance with their terms, subject to the
qualification that the enforceability of the Company's obligations thereunder
may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium, and other laws relating to or affecting creditors' rights generally
and by general equitable principles;
(viii) The Series A Subsidiary Guarantees have been duly and
validly authorized by the Guarantors and when duly executed and delivered by the
Guarantors in accordance with the terms of the Indenture and upon the due
execution, authentication and delivery of the Series A Notes in accordance with
the Indenture and the issuance of the Series A Notes in the sale to the Initial
Purchasers contemplated by this Agreement, will constitute valid and binding
obligations of the Guarantors, enforceable against the Guarantors in accordance
with their terms, subject to the qualification that the enforceability of the
Guarantors' obligations thereunder may be limited by bankruptcy, fraudulent
conveyance, insolvency, reorganization, moratorium, and other laws relating to
or affecting creditors' rights generally and by general equitable principles;
(ix) The Series B Subsidiary Guarantees have been duly and
validly authorized by the Guarantors and if and when duly executed and delivered
by the Guarantors in accordance with the terms of the Indenture and upon the due
execution, authentication and delivery of the Series B Notes in accordance with
the Indenture and the issuance and delivery of the Series B Notes in the
Exchange Offer contemplated by the Registration Rights Agreement, will
constitute valid and binding obligations of the Guarantors, enforceable against
the Guarantors in accordance with their terms, subject to the qualification that
the enforceability of the Guarantors' obligations thereunder may be limited by
bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and
other laws relating to or affecting creditors' rights generally and by general
equitable principles ;
(x) None of the issuance, offer or sale of the Series A Notes
and Series A Subsidiary Guarantees, the execution, delivery or performance by
the Company and the Guarantors of this Agreement or the other Operative
Documents, compliance by the Company and the Guarantors with the provisions
hereof or thereof nor consummation by the Company and the Guarantors of the
transactions contemplated hereby or thereby conflicts or will conflict with or
constitutes or will constitute a breach of, or a default under the certificate
or articles of incorporation or bylaws or other organizational documents of the
Company or any of the Subsidiaries or the Credit Agreement, or will result in
the creation or imposition of any lien, charge or encumbrance upon any property
or assets of the Company or the Subsidiaries pursuant to the terms of the Credit
Agreement nor will any such action result in any violation of any existing law,
or any regulation, ruling (assuming compliance with all applicable state
securities and Blue Sky laws and, in the case of the Registration Rights
Agreement, the Act, the Exchange Act and the 1939 Act), judgment, injunction,
order or decree known to such counsel, applicable to the Company or the
Subsidiaries or any of their respective properties;
(xi) No consent, approval, authorization or other order of, or
registration or filing with, any court, regulatory body, administrative agency
or other governmental body, agency, or official is required on the part of the
Company or the Guarantors for the valid issuance and sale of the Series A Notes
to the Initial Purchasers and the issuance of the Series A Subsidiary Guarantees
in
18
connection therewith as contemplated by this Agreement (other than as may be
required by applicable state securities and Blue Sky laws, as to which counsel
need express no opinions);
(xii) To the knowledge of such counsel, (A) other than as
described or contemplated in the Offering Memorandum, there are no legal or
governmental proceedings pending or threatened against the Company, the
Guarantors or any of the other Subsidiaries or to which the Company or any of
the Subsidiaries or any of their properties, are subject, which are not
disclosed in the Offering Memorandum and which, if adversely decided, are
reasonably likely to cause a Material Adverse Effect or materially affect the
issuance of the Notes or the consummation of the other transactions contemplated
by the Operative Documents and (B) there are no material agreements, contracts,
indentures, leases or other instruments, that are not described in the Offering
Memorandum;
(xiii) The statements under the captions "Risk Factors,"
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," "Business," "Description of Other Debt," and "Certain Federal
Income Tax Consequences" in the Offering Memorandum, insofar as they are
descriptions of contracts, agreements or other legal documents, (excluding
contracts, agreements or other legal documents pertaining to Company-sponsored
securitizations) or refer to statements of law or legal conclusions, are
accurate in all material respects and present fairly the information required to
be shown;
(xiv) Such counsel does not know of any person who has the
right, contractual or otherwise, to cause the Company to sell or otherwise issue
to them, or to permit them to underwrite the sale of, any of the Notes or the
right, as a result of the consummation of the transactions contemplated by the
Operative Documents, to require registration under the Act of any shares of
Common Stock or other securities of the Company;
(xv) When the Series A Notes are issued and delivered pursuant
to this Agreement, such Series A Notes will not be of the same class (within the
meaning of Rule 144A(d)(3) under the Act) as any security of the Company that is
listed on a national securities exchange registered under Section 6 of the
Exchange Act or that is quoted in a United States automated interdealer
quotation system;
(xvi) No registration of the Series A Notes under the Act is
required for the sale of the Series A Notes to the Initial Purchasers as
contemplated in this Agreement or for the Exempt Resales (assuming (A) that any
Eligible Purchaser who buys the Series A Notes in the Exempt Resales is a QIB
and (B) the accuracy of the Initial Purchasers' representations and those of the
Company and the Guarantors in this Agreement (it being understood that no
opinion is being expressed as to any resale subsequent to the Exempt Resales or
any resale of securities by any person other than the Initial Purchasers);
(xvii) The Company and the Guarantors are not required to
deliver the information specified in Rule 144A(d)(4) in connection with the
offering and resale of the Series A Notes by the Initial Purchasers;
(xviii) The Company is not required to obtain stockholder
consent for the issuance or offering of the Notes; and
In addition, such counsel shall also state that such counsel has
participated in conferences with officers and representatives of the Company and
the Guarantors, representatives of the independent public accountants for the
Company and the Guarantors and the Initial Purchasers at which the contents of
the Offering Memorandum and related matters were discussed and, although such
counsel
19
is not passing upon and does not assume any responsibility for and has not
verified the accuracy, completeness or fairness of the statements contained in
the Offering Memorandum, and has not made any independent check or verification
thereof, on the basis of the foregoing (relying as to materiality to the extent
such counsel deemed appropriate upon facts provided by officers and other
representatives of the Company and the Guarantors), no facts have come to the
attention of such counsel that lead such counsel to believe that the Offering
Memorandum, as of its date or as of the Closing Date, contained or contains any
untrue statement of material fact or omitted or omits to state any material fact
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading (it being understood that such counsel need
express no belief or opinion with respect to the financial statements and other
financial and statistical data included therein).
The opinion of such counsel may be limited to the laws of the state of
Texas, the laws of the states of New York and California, the General
Corporation Law of the State of Delaware and the federal laws of the United
States. Such counsel may rely as to matters of New York and California law, as
it relates to the authorization and enforceability of the Operative Documents
only, on the opinion of Xxxxxx & Xxxxxxx described below in Section 7(h). Such
counsel need not express any opinion with respect to the Canadian Guarantor,
except that such counsel shall express its opinion as to the due execution and
delivery of the Operative Documents by the Canadian Guarantor. In rendering
such opinion, such counsel may rely as to matters of Canadian and Ontario choice
of law rules, on the opinion of Fogler, Xxxxxxxx described below in Section
7(g).
(e) The Initial Purchasers shall have received on the Closing Date an
opinion of Xxxxx X. Xxxxxx, Esq., General Counsel of the Company, dated the
Closing Date and addressed to the Initial Purchasers to the effect that:
(i) The Company is duly registered and qualified to conduct
its business and is in good standing as a foreign corporation in each
jurisdiction or place where the nature of its properties or the conduct of its
business requires such registration or qualification, except where the failure
so to register or qualify or to be in good standing does not have a Material
Adverse Effect;
(ii) Each of the Guarantors is duly registered and qualified to
conduct its business and is in good standing as a foreign corporation in each
jurisdiction or place where the nature of its properties or the conduct of its
business requires such registration or qualification, except where the failure
so to register or qualify or to be in good standing does not have a Material
Adverse Effect;
(iii) Neither the Company nor any of the Subsidiaries is in
violation of its respective certificate or articles of incorporation or bylaws,
or other organizational documents, or to the best knowledge of such counsel
after reasonable inquiry, is in default in the performance of any material
obligation, agreement or condition contained in any bond, debenture, note or
other evidence of indebtedness or in any material agreement, indenture, lease or
other instrument to which the Company or any of the Subsidiaries is a party or
by which any of them or any of their respective properties may be bound, except
as disclosed in the Offering Memorandum and except to the extent that any such
violation or default would not have a Material Adverse Effect;
(iv) None of the issuance, offer or sale of the Series A Notes
and Series A Subsidiary Guarantees, the execution, delivery or performance by
the Company and the Guarantors of this Agreement or the other Operative
Documents, compliance by the Company and the Guarantors with the provisions
hereof or thereof nor consummation by the Company and the Guarantors of the
transactions contemplated hereby or thereby conflicts or will conflict with or
constitutes or will constitute a breach of, or a default under the certificate
or articles of incorporation or bylaws or other organizational documents of the
Company or any of the Subsidiaries or any material agreement,
20
indenture, lease or other instrument to which the Company or any of the
Subsidiaries is a party or by which any of them or any of their respective
properties is bound, or will result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or the
Subsidiaries pursuant to the terms of any material agreement or instrument to
which any of them is a party or by which any of them may be bound or to which
any of the property or assets of them is subject, nor will any such action
result in any violation of any existing law, or any regulation, ruling (assuming
compliance with all applicable state securities and Blue Sky laws and, in the
case of the Registration Rights Agreement, the Act, the Exchange Act and the
1939 Act), judgment, injunction, order or decree known to such counsel,
applicable to the Company or the Subsidiaries or any of their respective
properties;
(v) The statements under the caption "Management" in the
Offering Memorandum, insofar as they are descriptions of contracts, agreements
or other legal documents or refer to statements of law or legal conclusions, are
accurate in all material respects and present fairly the information required to
be shown;
(vi) To the best knowledge of such counsel after reasonable
inquiry, neither the Company nor any of the Subsidiaries is in violation of any
law, ordinance, administrative or governmental rule or regulation applicable to
the Company or any of the Subsidiaries or of any decree of any court or
governmental agency or body having jurisdiction over the Company or any of the
Subsidiaries, except to the extent that any such violation would not have a
Material Adverse Effect;
(vii) The Company and the Subsidiaries have all Permits that are
required under applicable law to own their respective properties and to conduct
their respective businesses as now being conducted as described in the Offering
Memorandum except where the failure to have any such Permits would not,
individually or in the aggregate, have a Material Adverse Effect;
(viii) The statements in the Offering Memorandum, insofar as they
are descriptions of contracts, agreements or other legal documents pertaining to
the Company's $505 Million Warehouse Facility and $150 Million Warehouse
Facility, are accurate in all material respects and present fairly the Company's
and the Guarantors' rights, obligations and liabilities in connection with such
Warehouse Facilities; and
(ix) None of the issuance, offer or sale of the Series A Notes,
the execution, delivery or performance by the Company and the Guarantors of this
Agreement or the other Operative Documents, compliance by the Company and the
Guarantors with the provisions hereof or thereof nor consummation by the Company
and the Guarantors of the transactions contemplated hereby or thereby conflicts
or will conflict with or constitutes or will constitute a breach of, or a
default under any material agreement, indenture, or other instrument pertaining
to the Company's $505 Million Warehouse Facility and $150 Million Warehouse
Facility, or will result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of the
Subsidiaries pursuant to the terms of any material agreement or instrument
pertaining to the Company's Warehouse Facilities.
(f) The Initial Purchasers shall have received on the Closing Date an
opinion of Xxxxx Xxxxxxxxxx LLP, special securitization counsel for the Company
and its Subsidiaries, dated the Closing Date, and addressed to the Initial
Purchasers to the effect that:
(i) The statements in the Offering Memorandum, insofar as they
are descriptions of contracts, agreements or other legal documents pertaining to
Company-sponsored securitizations, are accurate in all material respects and
present fairly the Company's and the Guarantors' rights, obligations and
liabilities in connection with such securitizations; and
21
(ii) None of the issuance, offer or sale of the Series A Notes,
the execution, delivery or performance by the Company and the Guarantors of this
Agreement or the other Operative Documents, compliance by the Company and the
Guarantors with the provisions hereof or thereof nor consummation by the Company
and the Guarantors of the transactions contemplated hereby or thereby conflicts
or will conflict with or constitutes or will constitute a breach of, or a
default under any material agreement, indenture, or other instrument pertaining
to a Company-sponsored securitization, or will result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of the
Company or any of the Subsidiaries pursuant to the terms of any material
agreement or instrument pertaining to a Company-sponsored securitization.
(g) The Initial Purchasers shall have received on the Closing Date an
opinion of Fogler, Rubinoff, Canadian counsel for the Company, dated the Closing
Date and addressed to the Initial Purchasers, in form and substance satisfactory
to counsel for the Initial Purchasers, to the effect that:
(i) The Canadian Guarantor is a corporation duly incorporated
and validly existing and in good standing under the laws of its jurisdiction of
incorporation, with all requisite power and authority to own, lease, and operate
its properties and to conduct its business as described in the Offering
Memorandum; and all the outstanding shares of capital stock or beneficial
interests of the Canadian Guarantor have been duly authorized and validly
issued, are fully paid and nonassessable, and to the knowledge of such counsel,
are wholly owned by the Company directly, or indirectly through one of the other
Subsidiaries, free and clear of any security interest, lien, adverse claim,
equity or other encumbrance, except as specifically described in the Offering
Memorandum under the caption "Description Of Other Debt;"
(ii) The Canadian Guarantor has the corporate power and
authority to enter into this Agreement and the Registration Rights Agreement and
this Agreement and the Registration Rights Agreement have been duly and validly
authorized by the Canadian Guarantor;
(iii) The Indenture has been duly and validly authorized by the
Canadian Guarantor;
(iv) The Series A Subsidiary Guarantees have been duly and
validly authorized by the Canadian Guarantor;
(v) The Series B Subsidiary Guarantees have been duly and
validly authorized by the Canadian Guarantor;
(vi) None of the issuance of the Series A Subsidiary
Guarantees, the execution, delivery or performance by the Canadian Guarantor of
this Agreement or the other Operative Documents, compliance by the Canadian
Guarantor with the provisions hereof or thereof nor consummation by the Canadian
Guarantor of the transactions contemplated hereby or thereby conflicts or will
conflict with or constitutes or will constitute a breach of, or a default under
the articles of incorporation or bylaws or other organizational documents of the
Canadian Guarantor or the Canadian Subsidiary Credit Agreement, or will result
in the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Canadian Guarantor pursuant to the terms of the
Canadian Subsidiary Credit Agreement nor will any such action result in any
violation of any existing law, or any regulation, ruling judgment, injunction,
order or decree known to such counsel, applicable to the Canadian Guarantor or
any of its properties;
(vii) No consent, approval, authorization or other order of, or
registration or filing with, any court, regulatory body, administrative agency
or other governmental body, agency, or
22
official is required on the part of the Canadian Guarantor for the issuance of
the Series A Subsidiary Guarantees in connection therewith as contemplated by
this Agreement;
(viii) In the event that the Operative Documents to which the
Canadian Guarantor is a party (the "Canadian Guarantor Documents") are sought to
be enforced in any action or proceeding in the Province of Ontario in accordance
with the laws applicable to the Canadian Guarantor Documents as chosen by the
parties, namely the laws of the State of New York, the courts of the Province of
Ontario would recognize such choice of laws provided that it was not made with a
view to avoiding the consequences of the laws of any other jurisdiction and
provided that such choice is not contrary to public policy, as that term is
understood under the laws of the Province of Ontario;
(ix) In the event that the Canadian Guarantor Documents are
sought to be enforced in any action or proceeding in the Province of Ontario in
accordance with the laws applicable thereto as chosen by the parties, namely the
laws of the State of New York, the courts of the Province of Ontario would,
subject to paragraph (viii), apply the laws of the State of New York, upon
appropriate evidence as to such laws being adduced, provided that none of the
provisions of the Canadian Guarantor Documents or of the laws of the State of
New York are contrary to public policy, as such term is understood under the
laws of the Province of Ontario. A court in the Province of Ontario has,
however, an inherent power to decline to hear such an action or proceeding if it
is contrary to public policy, as such term is understood under the laws of the
Province of Ontario, for it to do so, or if it is not the proper forum to hear
such action, or if concurrent proceedings are being brought elsewhere;
(x) The laws of the Province of Ontario permit an action to be
brought in a court of competent jurisdiction in the Province of Ontario on any
final and conclusive judgment in personam against the Canadian Guarantor in
respect of the Canadian Guarantor Documents by a court in the State of New York,
which is not impeachable as void or voidable under the internal laws of the
State of New York, for a sum certain if (i) the court rendering judgment had
jurisdiction over the Canadian Guarantor, as recognized by the courts of the
Province of Ontario; (ii) such judgment was not obtained by fraud or in a manner
contrary to natural justice and the enforcement thereof would not be
inconsistent with public policy, as such term is understood under the laws of
the Province of Ontario; (iii) the enforcement of such judgment does not
constitute, directly or indirectly, the enforcement of foreign revenue or penal
laws; and (iv) there has been compliance with the laws of the Province of
Ontario pertaining to the law of limitations and the time period under which an
action to enforce such judgment must be commenced;
(xi) Under the laws of the Province of Ontario and Canadian
conflict of laws principles, the execution and delivery of the Canadian
Guarantor Documents is governed by the lex loci contractus (the place of
execution) which we understood will be the State of Texas. That being said, the
laws of the Province of Ontario regarding execution and delivery are based in
common law principles and we know of no reason why the laws of the State of
Texas pertaining to execution and delivery would be materially different from
the laws of the Province of Ontario regarding same. In particular, the Canadian
Guarantor Documents need not be executed before a notary or any other
governmental authority in order to be duly executed and delivered; and
The opinion of such counsel may be limited to the laws of the Province
of Ontario and the federal laws of Canada.
(h) The Initial Purchasers shall have received on the Closing Date an
opinion, of Xxxxxx & Xxxxxxx, counsel for the Initial Purchasers, dated the
Closing Date, and addressed to the Initial Purchasers, with respect to the
Offering Memorandum and such other related matters as the Initial
23
Purchasers may reasonably request, and such counsel shall have received such
certificates, documents and information as they may reasonably request to enable
them to pass upon such matters.
(i) The Initial Purchasers shall have received letters addressed to
the Initial Purchasers, and dated the date hereof and the Closing Date from
PricewaterhouseCoopers LLP, independent certified public accountants,
substantially in the forms heretofore approved by the Initial Purchasers.
(j) (i) There shall not have been any decrease in stockholders'
equity of the Company nor any material increase in the short-term or long-term
debt of the Company (other than in the ordinary course of business) from that
set forth or specifically contemplated in the Offering Memorandum; (ii) the
Company and the Subsidiaries shall not have any liabilities or obligations,
direct or contingent (whether or not in the ordinary course of business), that
are material to the Company and the Subsidiaries, taken as a whole, other than
those reflected in the Offering Memorandum; and (iii) all the representations
and warranties of the Company and the Guarantors contained in this Agreement
shall be true and correct in all material respects on and as of the date hereof
and on and as of the Closing Date as if made on and as of the Closing Date, and
the Initial Purchasers shall have received a certificate, dated the Closing Date
and signed by the Chief Executive Officer and the Chief Financial Officer of the
Company (or such other officers as are acceptable to the Initial Purchasers), to
the effect set forth in this Section 7(j) and in Section 7(k) hereof.
(k) The Company and the Guarantors shall not have failed at or prior
to the Closing Date to have performed or complied in all material respects with
any of its agreements herein contained and required to be performed or complied
with by it hereunder at or prior to the Closing Date.
(l) There shall not have been any announcement by any "nationally
recognized statistical rating organization," as defined for purposes of Rule
436(g) under the Act, that (i) it is downgrading its rating assigned to any
class of securities of the Company or any asset-backed securities of any
Company-sponsored Securitization Trust (as such term is defined in the
Indenture), or (ii) it is reviewing its ratings assigned to any class of
securities of the Company or any asset-backed security of any Company-sponsored
Securitization Trust with a view to possible downgrading, or with negative
implications, or direction not determined.
(m) The Series A Notes shall have been approved for trading in the
PORTAL Market.
(n) The Company and the Guarantors shall have obtained, in writing,
all consents and waivers required under the terms of the Warehouse Facility
Agreements, the Credit Agreement, the Mortgage Facility Credit Agreement, the
Canadian Subsidiary Credit Agreement and existing Credit Enhancement Agreements
necessary to ensure that the execution and delivery of, and the performance of
all of the transactions contemplated by this Agreement and the other Operative
Documents will not conflict with or constitute a breach of, or a default under,
the Warehouse Facility Agreements, the Credit Agreement, the Mortgage Facility
Credit Agreement, the Canadian Subsidiary Credit Agreement or any Credit
Enhancement Agreement. The Company and the Guarantors shall have furnished
photocopies of such waivers and consents to the Initial Purchasers.
(o) The Company and the Guarantors shall have entered into the Credit
Agreement Amendment and shall have furnished photocopies of such Credit
Agreement Amendment to the Initial Purchasers. The Company shall have received
the Mortgage Facility Credit Agreement Amendment and shall have furnished
photocopies of such Mortgage Facility Credit Agreement Amendment to the Initial
Purchasers. The Company shall have received the Canadian Subsidiary Credit
Agreement Waiver and
24
shall have furnished photocopies of such Canadian Subsidiary Credit Agreement
Waiver to the Initial Purchasers.
(p) The Company and Guarantors shall have furnished or caused to be
furnished to the Initial Purchasers such further certificates and documents as
the Initial Purchasers or their counsel shall have requested.
All such opinions, certificates, letters, consents, waivers amendments
and other documents will be in compliance with the provisions hereof only if
they are reasonably satisfactory in form and substance to the Initial Purchasers
and counsel for the Initial Purchasers. Any certificate or document signed by
any officer of the Company or a Guarantor and delivered to the Initial
Purchasers, or to counsel for the Initial Purchasers, shall be deemed a
representation and warranty by the Company or Guarantor, as the case may be, to
the Initial Purchasers as to the statements made therein.
8. Expenses. The Company and the Guarantors jointly and severally
agree to pay the following costs, expenses and fees and all other costs and
expenses incident to the performance by any of them of any of their obligations
hereunder: (i) the preparation and reproduction of the Preliminary Offering
Memorandum and the Final Offering Memorandum (including, without limitation,
financial statements thereto), and each amendment or supplement to any of them,
this Agreement and the Indenture; (ii) the printing (or reproduction) and
delivery (including postage, air freight charges and charges for counting and
packaging) of such copies of the Final Offering Memorandum, the Preliminary
Offering Memorandum, and all amendments or supplements to any of them as may be
reasonably requested for use in connection with the offering and sale of the
Series A Notes; (iii) the preparation, printing, authentication, issuance and
delivery of certificates for the Notes, including any stamp taxes in connection
with the original issuance and sale of the Notes; (iv) the printing (or
reproduction) and delivery of this Agreement, the preliminary and supplemental
Blue Sky Memoranda and all other agreements or documents printed (or reproduced)
and delivered in connection with the offering of the Notes; (v) the application
for quotation of the Notes on the PORTAL Market; (vi) the qualification of the
Notes for offer and sale under the securities or Blue Sky laws of the several
states as provided in Section 4(f) hereof (including the reasonable fees,
expenses and disbursements of counsel for the Initial Purchasers relating to the
preparation, printing or reproduction, and delivery of the preliminary and
supplemental Blue Sky Memoranda and such qualification); (vii) the performance
by the Company of its obligations under the Registration Rights Agreement;
(viii) fees and expenses of the Trustee and its counsel; (ix) the transportation
and other expenses incurred by or on behalf of the Company representatives in
connection with presentations to prospective purchasers of the Series A Notes;
and (x) the fees and expenses of the Company's and the Guarantors' accountants
and the fees and expenses of counsel (including local and special counsel, if
any) for the Company and the Guarantors. The Company and each of the Guarantors
hereby agree that they will pay in full on the Closing Date the fees and
expenses referred to in clause (vi) of this Section 8 by delivering to counsel
for the Initial Purchasers on such date a check payable to such counsel in the
requisite amount.
9. Effective Date of Agreement. This Agreement shall become
effective upon the execution and delivery hereof by all the parties hereto.
10. Termination of Agreement. This Agreement shall be subject to
termination in the absolute discretion of the Initial Purchasers, without
liability on the part of any of the Initial Purchasers to the Company or any of
the Guarantors, by notice to the Company, if prior to the Closing Date, (i)
trading in securities generally on the New York Stock Exchange, the American
Stock Exchange or the Nasdaq National market shall have been suspended or
materially limited, (ii) a general moratorium on commercial banking activities
in New York or Texas shall have been declared, or (iii) there shall have
occurred any outbreak or escalation of hostilities involving the United States
or other domestic, foreign
25
or international calamity, crisis or change in political, financial or economic
conditions, the effect of which on the financial markets of the United States is
such as to make it, in the judgment of the Initial Purchasers, impracticable or
inadvisable to commence or continue the offering of the Series A Notes on the
terms set forth on the cover page of the Offering Memorandum or to enforce
contracts for the resale of the Series A Notes by the Initial Purchasers. Notice
of such termination may be given to the Company by telegram, telecopy or
telephone and shall be subsequently confirmed by letter.
11. Information Furnished by the Initial Purchasers. The statements
set forth in the stabilization legend on the inside front cover and the last
paragraph on the cover page of the Preliminary Offering Memorandum and Offering
Memorandum, constitute the only information furnished by or on behalf of the
Initial Purchasers as such information is referred to in Sections 5(b) and 6
hereof.
12. Miscellaneous. Except as otherwise provided in Sections 4, 9 and
10 hereof, notice given pursuant to any provision of this Agreement shall be in
writing and shall be delivered (i) if to the Company or the Guarantors, at the
office of the Company at 000 Xxxxxx Xxxxxx, Xxxx Xxxxx, XX 00000, Attention:
Chief Financial Officer with a copy to Jenkens & Xxxxxxxxx, P.C., 0000 Xxxx
Xxxxxx, Xxxxx 0000, Xxxxxx, XX 00000, Attention: L. Xxxxxx Xxxxxx, or (ii) if to
the Initial Purchasers, care of Xxxxxxx Xxxxx Barney Inc., 000 Xxxxxxxxx Xxxxxx,
Xxx Xxxx, XX 00000, Attention: Manager, Investment Banking Division with a copy
to Xxxxxx & Xxxxxxx, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Xxxxxx X. Xxxxxxx.
This Agreement has been and is made solely for the benefit of the
Initial Purchasers, the Company, the Guarantors and their respective directors,
officers and the controlling persons referred to in Section 6 hereof and their
respective successors and assigns, to the extent provided herein, and no other
person shall acquire or have any right under or by virtue of this Agreement.
Neither the term "successor" nor the term "successors and assigns" as used in
this Agreement shall include a purchaser from the Initial Purchasers of any of
the Series A Notes in his status as such purchaser.
13. Applicable Law; Counterparts. This Agreement shall be governed
by and construed in accordance with the laws of the State of New York applicable
to contracts made and to be performed within the State of New York and without
regard to the conflicts of law principles thereof.
This Agreement may be signed in various counterparts which together
constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
[signature page follows]
26
Please confirm that the foregoing correctly sets forth the agreement
between the Company, the Guarantors and the Initial Purchasers.
Very truly yours,
AmeriCredit Corp.
By /s/
----------------------------
Xxxxxx X. Xxxxx
Vice Chairman and Chief Financial
Officer
AmeriCredit Financial Services, Inc. Americredit Corporation of California
By /s/ By /s/
---------------------------- ----------------------------
Xxxxxx X. Xxxxx Xxxxxx X. Xxxxx
Vice Chairman and Chief Financial Vice Chairman and Chief Financial
Officer Officer
AmeriCredit Management Company ACF Investment Corp.
By /s/ By /s/
---------------------------- ----------------------------
Xxxxxx X. Xxxxx Xxxxxx X. Xxxxx
Vice Chairman and Chief Financial Vice Chairman and Chief Financial
Officer Officer
AmeriCredit Financial Services of
Canada Ltd.
By /s/
----------------------------
Xxxxxx X. Xxxxx
Chief Financial Officer
Confirmed as of the date first
above mentioned.
Xxxxxxx Xxxxx Xxxxxx Inc.
Bear, Xxxxxxx & Co. Inc.
ING Baring Xxxxxx Xxxx LLC
By: Xxxxxxx Xxxxx Barney Inc.
By /s/
--------------------------------
Name:
Title
SCHEDULE I
AmeriCredit Corp.
Principal Amount
Initial Purchaser of Notes
----------------- --------
Xxxxxxx Xxxxx Xxxxxx Inc.................................................... $120,000,000
Bear, Xxxxxxx & Co. Inc..................................................... $ 60,000,000
ING Baring Xxxxxx Xxxx LLC.................................................. $ 20,000,000
Total.................................................................... $200,000,000
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