CONTINENTAL AIRLINES, INC.
$200,000,000
Floating Rate Secured Notes due 2007
PURCHASE AGREEMENT
December 2, 2002
XXXXXX XXXXXXX & CO. INCORPORATED
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Continental Airlines, Inc., a Delaware corporation (the "COMPANY"),
proposes to issue and sell to Xxxxxx Xxxxxxx & Co. Incorporated (the "INITIAL
PURCHASER") $200,000,000 principal amount of its Floating Rate Secured Notes due
2007 bearing interest at the rate of USD 3-Month LIBOR + 0.90% (the "OFFERED
SECURITIES") to be issued pursuant to the provisions of an Indenture to be dated
as of the Closing Date (as defined below) (the "INDENTURE") among the Company,
Wilmington Trust Company, as trustee (the "TRUSTEE"), Xxxxxx Xxxxxxx Capital
Services Inc., as Liquidity Provider (the "LIQUIDITY PROVIDER"), and MBIA
Insurance Corporation, as Policy Provider (the "POLICY PROVIDER").
The holders of the Offered Securities will be entitled to the benefits
of an Exchange and Registration Rights Agreement, in a form reasonably
satisfactory to the Initial Purchaser to be dated as of the Closing Date (the
"REGISTRATION RIGHTS AGREEMENT") between the Company and the Initial Purchaser,
pursuant to which the Company will file a registration statement with the
Securities and Exchange Commission (the "COMMISSION") registering the Exchange
Securities referred to in such Registration Rights Agreement (the "EXCHANGE
SECURITIES") or the Offered Securities under the Securities Act of 1933, as
amended (the "SECURITIES ACT").
The Offered Securities will only be offered (A) in the case of offers
inside the United States, to persons reasonably believed by the Initial
Purchaser to be (1) "qualified institutional buyers" (as defined in Rule 144A
under the Securities Act) ("QIBS") in reliance on Rule 144A under the Securities
Act or (2) institutional "accredited investors" (as defined in Rule 501(a)(1),
(2), (3) or (7) under the Securities Act) ("INSTITUTIONAL ACCREDITED INVESTORS")
that deliver a letter in the form annexed as Annex III to the Final Memorandum
(as defined below) and (B) in the case of offers outside the United States, to
persons other than U.S. persons (including dealers or other professional
fiduciaries in the United States acting on a discretionary basis for foreign
beneficial owners (other than an estate or trust)) in accordance with Regulation
S under the Securities Act ("REGULATION S").
In connection with the sale of the Offered Securities, the Company has
prepared a preliminary offering memorandum dated November 26, 2002 (the
"PRELIMINARY MEMORANDUM") and a final offering memorandum dated the date of this
Agreement (the "FINAL MEMORANDUM" and, with the Preliminary Memorandum, each a
"MEMORANDUM") including or incorporating by reference a description of the terms
of the Offered Securities, the terms of the offering and a description of the
Company. As used herein, the terms "Preliminary Memorandum", "Final Memorandum"
and "Memorandum" shall include, in each case, the documents incorporated by
reference therein. The terms "SUPPLEMENT", "AMENDMENT" and "AMEND" as used
herein with respect to a Memorandum shall include all documents deemed to be
incorporated by reference in such Memorandum that are filed subsequent to the
date of such Memorandum with the Commission pursuant to the Securities Exchange
Act of 1934, as amended (the "EXCHANGE ACT").
The Offered Securities and the Exchange Securities will be secured by
a lien on the Collateral (as defined in the Indenture), which includes certain
aircraft spare parts and related assets owned by the Company. The Offered
Securities and the Exchange Securities will rank equally in right of payment
with all of the Company's other unsubordinated obligations, except to the extent
of the assets subject to such lien, as to which the Offered Securities and the
Exchange Securities will effectively rank senior.
Certain amounts of interest payable on the Offered Securities and the
Exchange Securities will be entitled to the benefits of a liquidity facility.
The Liquidity Provider and the Trustee will enter into a revolving credit
agreement to be dated as of the Closing Date (the "LIQUIDITY FACILITY") for the
benefit of the holders of the Offered Securities and the Exchange Securities.
Payments of interest on the Offered Securities and the Exchange
Securities will be supported by a financial guaranty insurance policy (the
"POLICY") issued by the Policy Provider to the extent the Liquidity Facility and
any funds contained in the Cash Collateral Account (as defined in the Indenture)
are insufficient or unavailable for that purpose. The Policy will also support
the payment of the principal of the Offered Securities and the Exchange
Securities on the Final Legal Maturity Date (as defined in the Indenture) as
well as the payment of principal of the Offered Securities and the Exchange
Securities prior to the Final Legal Maturity Date under certain circumstances
described in the Indenture and the Policy. The Policy will be issued pursuant to
an Insurance and Indemnity Agreement to be dated as of the Closing Date (the
"POLICY PROVIDER AGREEMENT") among the Policy Provider, the Company and the
Trustee. Under the Indenture and the Policy Provider Agreement, the Policy
Provider will be entitled to reimbursement for amounts paid pursuant to claims
made under the Policy, subject to certain limitations.
The Company understands that the Initial Purchaser proposes to make an
offering of the Offered Securities on the terms, subject to the conditions and
in the manner set forth in the Final Memorandum and Section 5 hereof, as soon as
the Initial Purchaser deems advisable after this Agreement (as defined below)
has been executed and delivered.
Capitalized terms used but not defined in this Purchase Agreement (the
"AGREEMENT") shall have the meanings specified therefor in the Indenture. As
used in this Agreement, the term "OPERATIVE AGREEMENTS" shall mean the
Indenture, the Security Agreement, the Collateral Maintenance Agreement, the
Reference Agency Agreement, the Registration Rights Agreement, the Liquidity
Facility, the Policy, the Policy Provider Agreement and the Indemnification
Agreement dated the date hereof (the "INDEMNIFICATION AGREEMENT") among the
Policy Provider, the Company and the Initial Purchaser.
1. REPRESENTATIONS AND WARRANTIES. (a) The Company represents and
warrants to, and agrees with, the Initial Purchaser that:
(i) In connection with the sale of the Offered Securities, the Company
has prepared the Preliminary Memorandum and the Final Memorandum. The
Company hereby confirms that it has authorized the use of the Preliminary
Memorandum in connection with the offer of the Offered Securities by the
Initial Purchaser on and prior to the date of this Agreement and the Final
Memorandum in connection with the offer and resale of the Offered
Securities by the Initial Purchaser after the date of this Agreement. On
the date of this Agreement, the Final Memorandum does not contain any
untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The preceding
sentence does not apply to statements in or omissions from the Final
Memorandum based upon (A) information furnished in writing by the Initial
Purchaser to the Company expressly for use therein ("INITIAL PURCHASER
INFORMATION") or (B) information under the caption "Description of the
Policy Provider" in the Final Memorandum or documents incorporated by
reference under such caption (collectively, the "POLICY PROVIDER
INFORMATION").
(ii) The documents incorporated by reference in the Final Memorandum
(excluding the Policy Provider Information), at the time they were or
hereafter, during the period mentioned in Section 4(a) hereof, are filed
with the Commission, complied or will comply, as the case may be, in all
material respects with the requirements of the Exchange Act.
(iii) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware, with
corporate power and authority to own, lease and operate its property and to
conduct its business as described in the Final Memorandum; and the Company
is duly qualified to do business as a foreign corporation in good standing
in all other jurisdictions in which its ownership or lease of property or
the conduct of its business requires such qualification, except where the
failure to be so qualified would not have a material adverse effect on the
condition (financial or otherwise), business, properties or results of
operations of the Company and its consolidated subsidiaries taken as a
whole (a "CONTINENTAL MATERIAL ADVERSE EFFECT").
(iv) Each of Continental Micronesia, Inc., Air Micronesia, Inc. and
ExpressJet Airlines, Inc. (together, the "SUBSIDIARIES") has been duly
incorporated and is an existing corporation in good standing under the laws
of the jurisdiction of its incorporation, with corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Final Memorandum; and each Subsidiary is duly
qualified to do business as a foreign corporation in good standing in all
other jurisdictions in which its ownership or lease of property or the
conduct of its business requires such qualification, except where the
failure to be so qualified would not have a Continental Material Adverse
Effect; all of the issued and outstanding capital stock of each Subsidiary
has been duly authorized and validly issued and is fully paid and
nonassessable; and, except as described in the Final Memorandum, each
Subsidiary's capital stock owned by the Company, directly or through
subsidiaries, is owned free from liens, encumbrances and defects.
(v) Except as described in the Final Memorandum, the Company is not in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which it is a party or by
which it may be bound or to which any of its properties may be subject,
except for such defaults that would not have a Continental Material Adverse
Effect. The execution, delivery and performance of this Agreement, the
Offered Securities, the Exchange Securities and the Operative Agreements to
which the Company is or will be a party, the consummation of the
transactions contemplated herein and therein, the issuance and sale of the
Offered Securities and the issuance and exchange of the Exchange Securities
have been duly authorized by all necessary corporate action of the Company
and will not result in any breach of any of the terms, conditions or
provisions of, or constitute a default under, or result in the creation or
imposition of any lien, charge or encumbrance (other than any lien, charge
or encumbrance created under any Operative Agreement) upon any property or
assets of the Company pursuant to, any indenture, loan agreement, contract,
mortgage, note, lease or other instrument to which the Company is a party
or by which the Company may be bound or to which any of the property or
assets of the Company is subject, which breach, default, lien, charge or
encumbrance, individually or in the aggregate, would have a Continental
Material Adverse Effect, nor will any such execution, delivery or
performance result in any violation of the provisions of the charter or
by-laws of the Company or any statute, rule, regulation or order of any
governmental agency or body or any court having jurisdiction over the
Company.
(vi) No consent, approval, authorization, or order of, or filing with,
any governmental agency or body or any court is required for the valid
authorization, execution and delivery by the Company of this Agreement, the
Offered Securities, the Exchange Securities and the Operative Agreements to
which it is or will be a party and for the consummation of the transactions
contemplated herein and therein, except (x) such as may be required under
the Securities Act, the Trust Indenture Act of 1939, as amended (the "TRUST
INDENTURE ACT"), the securities or "blue sky" or similar laws of the
various states and of foreign jurisdictions or rules and regulations of the
National Association of Securities Dealers, Inc. ("NASD") in connection
with the registration of the Offered Securities under the Securities Act
pursuant to the Registration Rights Agreement, (y) filings or recordings
with the Federal Aviation Administration (the "FAA") and under the UCC or
other laws in effect in any applicable jurisdiction governing the
perfection of security interests in the Collateral, which filings or
recordings referred to in this clause (y) shall have been made, or duly
presented for filing or recordation, or shall be in the process of being
duly filed or filed for recordation, on or prior to the Closing Date and
(z) the order of the Commission declaring the Exchange Offer Registration
Statement or the Shelf Registration Statement effective.
(vii) This Agreement has been duly executed and delivered by the
Company, and the Operative Agreements to which the Company will be a party
and the Offered Securities will be duly executed and delivered by the
Company on or prior to the Closing Date, as the case may be, and the
Exchange Securities will be duly executed and delivered by the Company on
the date of their delivery as described in the Registration Rights
Agreement.
(viii) The Operative Agreements to which the Company is or will be a
party, when duly executed and delivered by the Company, assuming that such
Operative Agreements have been duly authorized, executed and delivered by,
and constitute the legal, valid and binding obligations of, each other
party thereto, will constitute valid and binding obligations of the Company
enforceable in accordance with their terms, except (w) as enforcement
thereof may be limited by bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers), reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, (x) as enforcement thereof is subject to
general principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law) and (y) with respect to
indemnification and contribution provisions, as enforcement thereof may be
limited by applicable law. The Operative Agreements to which the Company is
or will be a party will, upon execution and delivery thereof, conform in
all material respects to the descriptions thereof in the Final Memorandum.
(ix) The consolidated financial statements of the Company incorporated
by reference in the Final Memorandum, together with the related notes
thereto, present fairly in all material respects the financial position of
the Company and its consolidated subsidiaries at the dates indicated and
the consolidated results of operations and cash flows of the Company and
its consolidated subsidiaries for the periods specified. Such financial
statements have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis throughout the periods
involved, except as otherwise stated therein and except that unaudited
financial statements do not have all required footnotes. The financial
statement schedules of the Company, if any, incorporated by reference in
the Final Memorandum present the information required to be stated therein.
(x) The Company is a "citizen of the United States" within the meaning
of Section 40102(a)(15) of Title 49 of the United States Code, as amended,
and holds an air carrier operating certificate issued pursuant to Chapter
447 of Title 49 of the United States Code, as amended, for aircraft capable
of carrying 10 or more individuals or 6,000 pounds or more of cargo. All of
the outstanding shares of capital stock of the Company have been duly
authorized and validly issued and are fully paid and non-assessable.
(xi) When duly executed, authenticated, issued and delivered in the
manner provided for in the Indenture and sold and paid for as provided in
this Agreement, the Offered Securities will constitute valid and binding
obligations of the Company enforceable in accordance with their terms,
except (w) as enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent transfers),
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally, (x) as enforcement thereof is
subject to general principles of equity (regardless of whether enforcement
is considered in a proceeding in equity or at law) and (y) with respect to
indemnification provisions, as enforcement thereof may be limited by
applicable law, and the holders thereof will be entitled to the benefits of
the Indenture. The Offered Securities will conform in all material respects
to the description thereof in the Final Memorandum.
(xii) When duly executed, authenticated, issued and delivered in the
manner provided for in the Indenture and the Registration Rights Agreement,
the Exchange Securities will constitute valid and binding obligations of
the Company enforceable in accordance with their terms, except (w) as
enforcement thereof may be limited by bankruptcy, insolvency (including,
without limitation, all laws relating to fraudulent transfers),
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally, (x) as enforcement thereof is
subject to general principles of equity (regardless of whether enforcement
is considered in a proceeding in equity or at law) and (y) with respect to
indemnification provisions, as enforcement thereof may be limited by
applicable law, and the holders thereof will be entitled to the benefits of
the Indenture. The Exchange Securities will conform in all material
respects to the description thereof in the Final Memorandum.
(xiii) The security interest created by the Security Agreement will be
for the benefit of the Holders and the Indemnitees and will constitute, on
and at all times after the Closing Date until the termination of the
Security Agreement, valid and perfected Liens on the Collateral purported
to be covered thereby, subject to no equal or prior Lien, except Permitted
Liens.
(xiv) Except as disclosed in the Final Memorandum, the Company and the
Subsidiaries have good and marketable title to all real properties and all
other properties and assets owned by them, in each case free from liens,
encumbrances and defects except where the failure to have such title would
not have a Continental Material Adverse Effect; and except as disclosed in
the Final Memorandum, the Company and the Subsidiaries hold any leased real
or personal property under valid and enforceable leases with no exceptions
that would have a Continental Material Adverse Effect.
(xv) Except as disclosed in the Final Memorandum, there is no action,
suit or proceeding before or by any governmental agency or body or court,
domestic or foreign, now pending or, to the knowledge of the Company,
threatened against the Company or any of its subsidiaries or any of their
respective properties that individually (or in the aggregate in the case of
any class of related lawsuits), could reasonably be expected to result in a
Continental Material Adverse Effect or that could reasonably be expected to
materially and adversely affect the consummation of the transactions
contemplated by this Agreement, the Offered Securities, the Exchange
Securities or the Operative Agreements.
(xvi) Except as disclosed in the Final Memorandum, no labor dispute
with the employees of the Company or any subsidiary exists or, to the
knowledge of the Company, is imminent that could reasonably be expected to
have a Continental Material Adverse Effect.
(xvii) Each of the Company and the Subsidiaries has all necessary
consents, authorizations, approvals, orders, certificates and permits of
and from, and has made all declarations and filings with, all federal,
state, local and other governmental authorities, all self-regulatory
organizations and all courts and other tribunals, to own, lease, license
and use its properties and assets and to conduct its business in the manner
described in the Final Memorandum, except to the extent that the failure to
so obtain, declare or file would not have a Continental Material Adverse
Effect.
(xviii) Except as disclosed in the Final Memorandum, (x) neither the
Company nor any of the Subsidiaries is in violation of any statute, rule,
regulation, decision or order of any governmental agency or body or any
court, domestic or foreign, relating to the use, disposal or release of
hazardous or toxic substances (collectively, "ENVIRONMENTAL LAWS"), owns or
operates any real property contaminated with any substance that is subject
to any environmental laws, or is subject to any claim relating to any
environmental laws, which violation, contamination, liability or claim
individually or in the aggregate is reasonably expected to have a
Continental Material Adverse Effect, and (y) the Company is not aware of
any pending investigation which might lead to such a claim that is
reasonably expected to have a Continental Material Adverse Effect.
(xix) The accountants that examined and issued an auditors' report
with respect to the consolidated financial statements of the Company and
the financial statement schedules of the Company, if any, included or
incorporated by reference in the Final Memorandum are independent public
accountants within the meaning of the Securities Act.
(xx) The Company is not (based on applicable law as in effect on the
date hereof) an "investment company", or an entity "controlled" by an
"investment company", within the meaning of the Investment Company Act of
1940, as amended (the "INVESTMENT COMPANY ACT"), required to register under
the Investment Company Act.
(xxi) The Offered Securities satisfy the eligibility requirements of
Rule 144A(d)(3) under the Securities Act.
(xxii) Assuming the accuracy of the representations and warranties and
compliance with the agreements made by the Initial Purchaser in this
Agreement, the offer and sale of the Offered Securities to the Initial
Purchaser in the manner contemplated by this Agreement will be exempt from
the registration requirements of the Securities Act by reason of Section
4(2) thereof and Regulation S thereunder and, except as required under the
Registration Rights Agreement, it is not necessary to qualify the Indenture
under the Trust Indenture Act in respect of any such offer or sale.
(xxiii) Neither the Company nor any of its affiliates, nor any person
acting on their behalf, (i) has, within the six-month period prior to the
date hereof, offered or sold in the United States or to any U.S. person (as
such terms are defined in Regulation S under the Securities Act) the
Offered Securities or any security of the same class or series as the
Offered Securities or (ii) has offered or will solicit any offer to buy, or
will offer or sell the Offered Securities (x) in the United States by any
form of "general solicitation" or "general advertising" within the meaning
of Rule 502(c) under the Securities Act or in any manner involving a public
offering within the meaning of Section 4(2) of the Securities Act or (y)
with respect to any securities sold in reliance on Rule 903 of Regulation S
under the Securities Act, by means of any "directed selling efforts" within
the meaning of Rule 902(c) of Regulation S. The Company has not entered and
will not enter into any contractual arrangement with respect to the
distribution of the Offered Securities except for this Agreement. The
Company and its affiliates and any person acting on its or their behalf
have complied and will comply with the offering restrictions requirement of
Regulation S.
(xxiv) Xxxxx, Xxxxxxxxx & Xxxxxxx, Inc. ("SH&E") is not an affiliate
of the Company and, to the knowledge of the Company, does not have a
substantial interest, direct or indirect, in the Company. To the knowledge
of the Company, none of the officers and directors of SH&E is connected
with the Company or any of its affiliates as an officer, employee,
promoter, underwriter, trustee, partner, director or person performing
similar functions.
(b) The parties agree that any certificate signed by a duly authorized
officer of the Company and delivered to the Initial Purchaser, or to counsel for
the Initial Purchaser, on the Closing Date and in connection with this Agreement
or the offering of the Offered Securities, shall be deemed a representation and
warranty by (and only by) the Company to the Initial Purchaser as to the matters
covered thereby.
2. PURCHASE, SALE AND DELIVERY OF OFFERED SECURITIES. (a) On the basis
of the representations, warranties and agreements herein contained, but subject
to the terms and the conditions herein set forth, the Company agrees to sell to
the Initial Purchaser, and the Initial Purchaser agrees to purchase from the
Company, the aggregate principal amount of Offered Securities at a purchase
price of 98.875% of the principal amount thereof plus accrued interest, if any,
from the date of issuance.
(b) The Company shall issue and deliver against payment of the
purchase price the Offered Securities purchased by the Initial Purchaser
hereunder and to be offered and sold by the Initial Purchaser in reliance on
Regulation S under the Securities Act (the "REGULATION S SECURITIES") in the
form of one or more global securities in definitive, fully registered form
without interest coupons (the "REGULATION S GLOBAL SECURITIES") which shall be
deposited with the Trustee as custodian for The Depository Trust Company ("DTC")
and registered in the name of a nominee of DTC, for the respective accounts of
the DTC participants for Euroclear Bank S.A./N.V., as operator of the Euroclear
System ("EUROCLEAR"), and Clearstream Banking, societe anonyme ("CLEARSTREAM").
On or prior to the 40th day after the later of the day on which the Offered
Securities are first offered to persons other than distributors (as defined in
Regulation S under the Securities Act) and the Closing Date, beneficial
interests in the Regulation S Global Securities may be held only through
Euroclear and Clearstream. Regulation S Securities shall be available only in
book-entry form, except in the limited circumstances described in the Final
Memorandum.
(c) The Company shall issue and deliver against payment of the
purchase price the Offered Securities to be purchased by the Initial Purchaser
hereunder and to be offered and sold by the Initial Purchaser to QIBs in
reliance on Rule 144A under the Securities Act (the "144A SECURITIES") in the
form of one or more permanent global securities in definitive, fully registered
form without interest coupons (the "RESTRICTED GLOBAL SECURITIES" and, together
with the Regulation S Global Securities, the "GLOBAL SECURITIES") which shall be
deposited with the related Trustee as custodian for DTC and registered in the
name of a nominee of DTC for credit to the account of the Initial Purchaser.
Each Restricted Global Security shall include the legend regarding restrictions
on transfer set forth under "Transfer Restrictions" in the Final Memorandum. The
Regulation S Securities and the 144A Securities shall be assigned separate CUSIP
numbers.
(d) Payment for the Offered Securities shall be made by the Initial
Purchaser in federal (same day) funds by official check or checks or wire
transfer to an account previously designated to the Initial Purchaser by the
Company at 10:00 a.m. (New York time), on December 6, 2002, or at such other
date and time as may be agreed upon by the Company and the Initial Purchaser
(such date and time of delivery and payment for the Offered Securities being
herein referred to as the "CLOSING DATE"), against delivery to the Trustee as
custodian for DTC at the offices of Xxxxxx Xxxxxxx & Xxxx LLP at One Battery
Park Plaza, New York, New York 10004 (or at such other location as may be agreed
to by the Initial Purchaser and the Company) of (i) the Regulation S Global
Securities representing all of the Regulation S Securities for the respective
accounts of the DTC participants for Euroclear and Clearstream and (ii) the
Restricted Global Securities representing all of the 144A Securities. The
Regulation S Global Securities and the Restricted Global Securities shall be
made available for checking at the office of Xxxxxx Xxxxxxx & Xxxx LLP (or at
such other location as may be agreed to by the Initial Purchaser and the
Company) not later than 1:00 p.m. on the business day prior to the Closing Date.
(e) Notwithstanding the foregoing, any Offered Securities sold by the
Initial Purchaser pursuant to Section 5(a) hereof to Institutional Accredited
Investors who are not QIBs and are not purchasers of interests in the Regulation
S Global Securities shall be issued in definitive, fully registered form without
interest coupons ("DEFINITIVE SECURITIES") and shall bear the legend relating
thereto set forth under "Transfer Restrictions" in the Final Memorandum, but
shall be paid for in the manner set forth in Section 2(d) hereof. Upon transfer
of Definitive Securities to a QIB or in accordance with Regulation S under the
Securities Act, such Definitive Securities shall be exchanged for an interest in
the appropriate Global Security. Definitive Securities shall be registered in
such names and in such authorized denominations as the Initial Purchaser may
request not less than two full business days in advance of the Closing Date.
3. CONDITIONS OF THE OBLIGATIONS OF THE INITIAL PURCHASER. The Initial
Purchaser's obligations to purchase and pay for the Offered Securities pursuant
to this Agreement are subject to the following conditions:
(a) On the Closing Date, the Initial Purchaser shall have received an
opinion of Xxxxxx Xxxxxxx & Xxxx LLP, counsel for the Company, dated the Closing
Date, in form and substance reasonably satisfactory to the Initial Purchaser.
(b) On the Closing Date, the Initial Purchaser shall have received an
opinion of the General Counsel of the Company, dated the Closing Date, in form
and substance reasonably satisfactory to the Initial Purchaser.
(c) On the Closing Date, the Initial Purchaser shall have received an
opinion of Xxxxxxxx, Xxxxxx & Finger, P.A., counsel for Wilmington Trust
Company, individually and as Trustee, dated the Closing Date, in form and
substance reasonably satisfactory to the Initial Purchaser.
(d) On the Closing Date, the Initial Purchaser shall have received an
opinion of Milbank, Tweed, Xxxxxx & XxXxxx LLP, special New York counsel for the
Liquidity Provider and the Liquidity Provider Guarantor, dated the Closing Date,
in form and substance reasonably satisfactory to the Initial Purchaser.
(e) On the Closing Date, the Initial Purchaser shall have received an
opinion of in-house counsel for the Liquidity Provider and the Liquidity
Provider Guarantor, dated the Closing Date, in form and substance reasonably
satisfactory to the Initial Purchaser.
(f) On the Closing Date, the Initial Purchaser shall have received an
opinion of Xxxxxx & Xxxxxxx, special New York counsel for the Policy Provider,
dated the Closing Date, in form and substance reasonably satisfactory to the
Initial Purchaser.
(g) On the Closing Date, the Initial Purchaser shall have received an
opinion of in-house counsel for the Policy Provider, dated the Closing Date, in
form and substance reasonably satisfactory to the Initial Purchaser.
(h) On the Closing Date, the Initial Purchaser shall have received an
opinion of Xxxxx, Xxxxx & Xxxxxx, special counsel in Oklahoma City, Oklahoma,
dated the Closing Date, in form and substance reasonably satisfactory to the
Initial Purchaser.
(i) On the Closing Date, the Initial Purchaser shall have received an
opinion of Milbank, Tweed, Xxxxxx & XxXxxx LLP, counsel for the Initial
Purchaser, dated the Closing Date, with respect to the validity of the Offered
Securities, the Final Memorandum, the exemption from registration for the offer
and sale of the Offered Securities to the Initial Purchaser as contemplated
hereby and other related matters as the Initial Purchaser may reasonably
require, and the Company shall have furnished to such counsel such documents as
they reasonably request for the purpose of enabling them to pass upon such
matters.
(j) Subsequent to the execution and delivery of this Agreement, there
shall not have occurred any change, or any development involving a prospective
change, in the condition (financial or other), business, properties or results
of operations of the Company and its subsidiaries considered as one enterprise
that, in the Initial Purchaser's judgment, is material and adverse and that
makes it, in the Initial Purchaser's judgment, impracticable to market the
Offered Securities on the terms and in the manner contemplated by the Final
Memorandum.
(k) Subsequent to the execution and delivery of this Agreement, there
shall not have occurred any change, or any development involving a prospective
change, in the condition (financial or other), business, properties or results
of operations of the Policy Provider and its subsidiaries considered as one
enterprise that, in the Initial Purchaser's judgment, is material and adverse
and that makes it, in the Initial Purchaser's judgment, impracticable to market
the Offered Securities on the terms and in the manner contemplated by the Final
Memorandum.
(l) The Initial Purchaser shall have received on the Closing Date a
certificate, dated the Closing Date and signed by the President or any Vice
President of the Company, to the effect that the representations and warranties
of the Company contained in this Agreement are true and correct as of the
Closing Date as if made on the Closing Date (except to the extent that they
relate solely to an earlier date, in which case they shall be true and accurate
as of such earlier date), that the Company has performed all its obligations to
be performed hereunder on or prior to the Closing Date and that, subsequent to
the execution and delivery of this Agreement, there shall not have occurred any
material adverse change, or any development or event involving a prospective
material adverse change, in the condition (financial or other), business,
properties or results of operations of the Company and its subsidiaries
considered as one enterprise, except as set forth in or contemplated by the
Final Memorandum.
(m) As of the Closing Date, the representations and warranties of the
Policy Provider contained in the Indemnification Agreement shall be true and
correct in all material respects as of the Closing Date (except to the extent
that they relate solely to an earlier or later date, in which case they shall be
true and correct as of such earlier or later date) and the Initial Purchaser
shall have received a certificate of the President or a Vice President of the
Policy Provider, dated the Closing Date, to such effect.
(n) The Initial Purchaser shall have received from Ernst & Young LLP a
letter, dated the date hereof, in form and substance satisfactory to the Initial
Purchaser.
(o) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date, there shall not have been any downgrading in the
rating accorded any of the Company's securities (except for any pass through
certificates) by any "nationally recognized statistical rating organization", as
such term is defined for purposes of Rule 436(g)(2) under the Securities Act, or
any public announcement that any such organization has under surveillance or
review, in each case for possible change, its ratings of any such securities
other than pass through certificates (other than an announcement with positive
implications of a possible upgrading, and no implication of a possible
downgrading, of such rating).
(p) SH&E shall have furnished to the Initial Purchaser a letter,
addressed to the Company and dated the Closing Date, confirming that SH&E and
each of its directors and officers (i) is not an affiliate of the Company or any
of its affiliates, (ii) does not have any substantial interest, direct or
indirect, in the Company or any of its affiliates and (iii) is not connected
with the Company or any of its affiliates as an officer, employee, promoter,
underwriter, trustee, partner, director or person performing similar functions.
(q) At the Closing Date, each of the Operative Agreements shall have
been duly executed and delivered by each of the parties thereto; and the
representations and warranties of the Company contained in each of such executed
Operative Agreements shall be true and correct as of the Closing Date (except to
the extent that they relate solely to an earlier date, in which case they shall
be true and correct as of such earlier date) and the Initial Purchaser shall
have received a certificate of the President or a Vice President of the Company,
dated as of the Closing Date, to such effect.
(r) On the Closing Date, the Offered Securities shall be rated "Aaa"
by Xxxxx'x Investors Service, Inc.
(s) The Initial Purchaser shall have received from Ernst & Young LLP a
letter, dated the Closing Date, which meets the requirements of subsection (n)
of this Section 3, except that the specified date referred to in such subsection
will be a date not more than three business days prior to the Closing Date for
the purposes of this subsection.
(t) On the Closing Date (a) the Security Agreement shall have been
duly filed for recordation with the FAA in accordance with the Federal Aviation
Act and (b) each Financing Statement shall have been duly filed in the
appropriate jurisdiction.
The Company will furnish the Initial Purchaser with such conformed
copies of such opinions, certificates, letters and documents as the Initial
Purchaser reasonably requests.
4. CERTAIN AGREEMENTS OF THE COMPANY. The Company agrees with the
Initial Purchaser that:
(a) During the period described in the following sentence of this
Section 4(a), the Company shall advise the Initial Purchaser promptly of any
proposal to amend or supplement the Final Memorandum (except by documents filed
under the Exchange Act) and will not effect such amendment or supplement (except
by documents filed under the Exchange Act) without the Initial Purchaser's
consent, which consent will not be unreasonably withheld. If, at any time prior
to the completion of the resale of the Offered Securities by the Initial
Purchaser, any event shall occur as a result of which it is necessary to amend
or supplement the Final Memorandum in order to make the statements therein, in
the light of the circumstances when the Final Memorandum is delivered to a
purchaser, not misleading in any material respect, the Company shall prepare and
furnish to the Initial Purchaser, at the Company's own expense, either
amendments or supplements to the Final Memorandum so that the statements in the
Final Memorandum as so amended or supplemented will not, in the light of the
circumstances when the Final Memorandum is delivered to a purchaser, be
misleading in any material respect. Neither the Initial Purchaser's consent to,
nor the Initial Purchaser's delivery to offerees or investors of, any such
amendment or supplement shall constitute a waiver of any of the conditions set
forth in Section 3 hereof.
(b) Notwithstanding any provision of Section 4(a) hereof to the
contrary, the Company's obligations under Section 4(a) hereof shall terminate on
the earlier to occur of (i) the effective date of the Exchange Offer
Registration Statement or Shelf Registration Statement and (ii) the date upon
which the Initial Purchaser and the Initial Purchaser's affiliates cease to hold
Offered Securities acquired as part of the Initial Purchaser's initial
distributions.
(c) The Company will furnish to the Initial Purchaser copies of the
Preliminary Memorandum, the Final Memorandum and all amendments and supplements
to such documents (excluding all documents incorporated by reference therein),
in each case as soon as available and in such quantities as the Initial
Purchaser reasonably requests. So long as any of the Offered Securities are
Registrable Securities (as defined in the Registration Rights Agreement), at any
time when the Company is not subject to Section 13 or 15(d) of the Exchange Act,
the Company will provide to any holder of such Registrable Securities, or to any
prospective purchaser of such Registrable Securities designated by a holder,
upon the request of such holder or prospective purchaser, any information
required to be delivered to holders and prospective purchasers of the Offered
Securities pursuant to Rule 144A(d)(4) under the Securities Act. This covenant
is intended to be for the benefit of the holders, and prospective purchasers
designated by such holders from time to time, of such Registrable Securities.
(d) If requested by the Initial Purchaser, the Company shall use its
reasonable efforts to permit the Offered Securities to be designated PORTAL
securities in accordance with the rules and regulations adopted by the NASD
relating to trading in the PORTAL Market.
(e) The Company shall, in cooperation with the Initial Purchaser,
endeavor to arrange for the qualification of the Offered Securities for offer
and sale under the applicable securities or "blue sky" laws of such
jurisdictions in the United States as the Initial Purchaser reasonably
designates and will endeavor to maintain such qualifications in effect so long
as required for the resale of the Offered Securities by the Initial Purchaser;
PROVIDED that the Company shall not be required to (i) qualify as a foreign
corporation or as a dealer in securities, (ii) file a general consent to service
of process or (iii) subject itself to taxation in any such jurisdiction.
(f) During the period of ten years after the Closing Date, the Company
will promptly furnish to the Initial Purchaser, upon request, copies of all
Annual Reports on Form 10-K and any definitive proxy statement of the Company
filed with the Commission; PROVIDED that providing a website address at which
such Annual Reports and any such definitive proxy statements may be accessed
will satisfy this clause (f).
(g) Between the date of this Agreement and the Closing Date, the
Company shall not, without the prior written consent of the Initial Purchaser,
offer, sell, or enter into any agreement to sell (as public debt securities
registered under the Securities Act or as debt securities which may be resold in
a transaction exempt from the registration requirements of the Securities Act in
reliance on Rule 144A thereunder (other than the Offered Securities) and which
are marketed through the use of a disclosure document containing substantially
the same information as a prospectus for similar debt securities registered
under the Securities Act), any notes of the Company secured by Spare Parts or
Appliances (or rights relating thereto).
(h) During the period of two years after the Closing Date, the Company
will, upon request, furnish to the Initial Purchaser and any holder of Offered
Securities or Exchange Securities, as the case may be, a copy of the
restrictions on transfer applicable to such Offered Securities or Exchange
Securities.
(i) During the period of two years after the Closing Date, the Company
will not, and will not permit any of its affiliates (as defined in Rule 144
under the Securities Act) to, resell any of the Offered Securities or Exchange
Securities that have been reacquired by any of them.
(j) During the period of two years after the Closing Date (or, if
shorter, the period beginning on the Closing Date and ending on the date on
which there ceases to be any Registrable Securities), the Company will not be or
become an open-end investment company, unit investment trust or face-amount
certificate company that is or is required to be registered under Section 8 of
the Investment Company Act, or a closed-end investment company required to be
registered, but not registered, under the Investment Company Act.
(k) Neither the Company nor any affiliate of the Company will sell,
offer for sale or solicit offers to buy or otherwise negotiate in respect of any
security (as defined in the Securities Act) which would be integrated with the
sale of the Offered Securities in a manner which would require the registration
under the Securities Act of the Offered Securities sold to the Initial Purchaser
pursuant to this Agreement.
(l) The Company shall not take any action prohibited by Regulation M
under the Exchange Act in connection with the distribution of the Offered
Securities contemplated hereby.
5. OFFERING OF SECURITIES; RESTRICTIONS ON TRANSFER.
(a) The Initial Purchaser represents and warrants that it is an
"accredited investor" within the meaning of Regulation D under the Securities
Act. The Initial Purchaser represents, warrants and agrees with the Company that
(i) it has not solicited and will not solicit offers for, or offer or sell, the
Offered Securities by any form of "general solicitation" or "general
advertising" (as those terms are used in Regulation D under the Securities Act)
or in any manner involving a public offering within the meaning of Section 4(2)
of the Securities Act and (ii) it has solicited and will solicit offers for the
Offered Securities only from, and has offered and will offer and sell the
Offered Securities only to (A) in the case of offers and sales inside the United
States, persons that it reasonably believes to be (1) QIBs in compliance with
Rule 144A under the Securities Act or (2) Institutional Accredited Investors
that, prior to their purchase of the Offered Securities, execute and deliver to
the Initial Purchaser a letter in the form annexed as Xxxxx XXX to the Final
Memorandum and (B) in the case of offers and sales outside the United States,
persons other than U.S. persons (including dealers or other professional
fiduciaries in the United States acting on a discretionary basis for foreign
beneficial owners (other than an estate or trust)) in accordance with Regulation
S under the Securities Act; provided, in the case of each of clauses (A) and (B)
that, in purchasing such Offered Securities, such persons are deemed to have
represented and agreed as provided in the Final Memorandum under the caption
"Transfer Restrictions".
(b) The Initial Purchaser represents, warrants and agrees with respect
to offers and sales outside the United States that:
(i) it understands that no action has been or will be taken in any
jurisdiction by the Company that would permit a public offering of the
Offered Securities, or possession or distribution of either the Preliminary
Memorandum or the Final Memorandum or any other offering or publicity
material relating to the Offered Securities, in any country or jurisdiction
where action for that purpose is required;
(ii) it will comply with all applicable laws and regulations in each
jurisdiction in which it acquires, offers, sells or delivers Offered
Securities or has in its possession or distributes either the Preliminary
Memorandum or the Final Memorandum or any other offering or publicity
material relating to the Offered Securities, in all cases at its own
expense;
(iii) the Offered Securities have not been registered under the
Securities Act and may not be offered or sold within the United States or
to, or for the account or benefit of, U.S. persons except in accordance
with Rule 144A or Regulation S under the Securities Act or pursuant to
another exemption from the registration requirements of the Securities Act;
(iv) it has offered the Offered Securities and will offer and sell the
Offered Securities (A) as part of its distribution at any time and (B)
otherwise until 40 days after the later of the commencement of the offering
and the Closing Date, only in accordance with Rule 903 of Regulation S or
as otherwise permitted in Section 5(a) hereof; neither the Initial
Purchaser, its affiliates nor any persons acting on its or their behalf
have engaged or will engage in any "directed selling efforts" (within the
meaning of Regulation S) with respect to the Offered Securities, and the
Initial Purchaser, its affiliates and any such persons have complied and
will comply with the offering restrictions requirement of Regulation S;
(v) it (A) has not offered or sold and, prior to the date six months
after the Closing Date, will not offer or sell any Offered Securities to
persons in the United Kingdom except to persons whose ordinary activities
involve them in acquiring, holding, managing or disposing of investments
(as principal or agent) for the purposes of their businesses or otherwise
in circumstances which have not resulted and will not result in an offer to
the public in the United Kingdom within the meaning of the Public Offers of
Securities Regulations 1995; (B) has complied and will comply with all
applicable provisions of the Financial Services and Markets Act 2000 (the
"FSMA") with respect to anything done by it in relation to the Offered
Securities in, from or otherwise involving the United Kingdom; and (C) will
only communicate or cause to be communicated any invitation or inducement
to engage in investment activity (within the meaning of section 21 of the
FSMA) received by it in connection with the issue or sale of the Offered
Securities in circumstances in which section 21(1) of the FSMA does not
apply to the Company;
(vi) it agrees that, at or prior to confirmation of sales of the
Offered Securities, it will have sent to each distributor, dealer or person
receiving a selling concession, fee or other remuneration that purchases
Offered Securities from it during the restricted period a confirmation or
notice to substantially the following effect:
"The Offered Securities covered hereby have not been registered under
the U.S. Securities Act of 1933 (the "Securities Act") and may not be
offered and sold within the United States or to, or for the account or
benefit of, U.S. persons (i) as part of their distribution at any time
or (ii) otherwise until 40 days after the later of the commencement of
the offering and the closing date, except in either case in accordance
with Regulation S (or Rule 144A if available) under the Securities
Act. Terms used above have the meaning given to them by Regulation S."
Terms used in this Section 5 have the meanings given to them by Regulation S.
6. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company agrees to indemnify and hold harmless the Initial
Purchaser, and each Person, if any, who controls the Initial Purchaser within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses
reasonably incurred by the Initial Purchaser or any such controlling person in
connection with defending or investigating any such action or claim) caused by
any untrue statement or alleged untrue statement of a material fact contained in
the Preliminary Memorandum or the Final Memorandum (in each case, as
supplemented or amended) or caused by any omission or alleged omission to state
therein a material fact necessary to make the statements therein in the light of
the circumstances under which they were made not misleading, except insofar as
such losses, claims, damages or liabilities are caused by any such untrue
statement or omission or alleged untrue statement or omission based upon Initial
Purchaser Information or Policy Provider Information; PROVIDED, HOWEVER, that
the foregoing indemnity agreement with respect to the Preliminary Memorandum
shall not inure to the benefit of the Initial Purchaser, or to the benefit of
any person controlling the Initial Purchaser, with respect to any such losses,
claims, damages or liabilities asserted by a person who purchased Offered
Securities from the Initial Purchaser, if a copy of the Final Memorandum (as
then amended or supplemented if the Company shall have furnished or filed with
the Commission any amendments or supplements thereto) was not sent or given by
or on behalf of the Initial Purchaser to such person at or prior to the written
confirmation of the sale of such Offered Securities to such person, and if the
Final Memorandum (as so amended or supplemented) would have cured the defect
giving rise to such losses, claims, damages or liabilities unless such failure
to deliver the Final Memorandum was a result of noncompliance by the Company
with its delivery requirements set forth in Section 4(a) hereof.
(b) The Initial Purchaser agrees to indemnify and hold harmless the
Company, its directors, its officers and each person, if any, who controls the
Company within the meaning of either Section 15 of the Securities Act or Section
20 of the Exchange Act to the same extent as the foregoing indemnity from the
Company to the Initial Purchaser, but only with reference to the Initial
Purchaser Information.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to either Section 6(a) or Section 6(b) hereof, such person (the
"INDEMNIFIED PARTY") shall promptly notify the person against whom such
indemnity may be sought (the "INDEMNIFYING PARTY") in writing. The indemnifying
party, upon request of the indemnified party, shall, and the indemnifying party
may elect to, retain counsel reasonably satisfactory to the indemnified party to
represent the indemnified party and any others the indemnifying party may
designate in such proceeding and the indemnifying party shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel, (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them, or (iii) the indemnifying party shall have
failed to retain counsel as required by the prior sentence to represent the
indemnified party within a reasonable amount of time. It is understood that the
indemnifying party shall not, in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the fees and expenses of
more than one separate firm (in addition to any local counsel) for all such
indemnified parties and that all such fees and expenses shall be reimbursed as
they are incurred. Such firm shall be designated in writing by the Initial
Purchaser in the case of parties indemnified pursuant to Section 6(a) hereof and
by the Company in the case of parties indemnified pursuant to Section 6(b)
hereof. The indemnifying party shall not be liable for any settlement of any
proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party from and against any loss or
liability by reason of such settlement or judgment. Notwithstanding the
foregoing sentence, if at any time an indemnified party shall have requested in
writing an indemnifying party to reimburse the indemnified party for fees and
expenses of counsel as contemplated by the second and third sentences of this
Section 6(c), the indemnifying party agrees that it shall be liable for any
settlement of any proceeding effected without its written consent if (i) such
settlement is entered into more than 90 days after receipt by such indemnifying
party of the aforesaid request and (ii) such indemnifying party shall not have
reimbursed the indemnified party in accordance with such request prior to the
date of such settlement, unless such fees and expenses are being disputed in
good faith. The indemnifying party at any time may, subject to the last sentence
of this Section 6(c), settle or compromise any proceeding described in this
Section 6(c) at the expense of the indemnifying party. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened 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 (i) includes
an unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding and (ii) does not include a
statement as to, or an admission of, fault, culpability or a failure to act by
or on behalf of an indemnified party.
(d) To the extent the indemnification provided for in Section 6(a) or
Section 6(b) hereof is required to be made but is unavailable to an indemnified
party or insufficient in respect of any losses, claims, damages or liabilities,
then the applicable indemnifying party under such Section, in lieu of
indemnifying such indemnified party thereunder, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages or liabilities (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company, on the one hand, and the Initial
Purchaser, on the other hand, from the offering of the Offered Securities 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 on the one hand and the Initial Purchaser on the other hand in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Initial Purchaser on the other hand in connection with the offering of
the Offered Securities shall be deemed to be in the same respective proportions
as the proceeds from the offering of the Offered Securities received by the
Company (before deducting expenses) and the total underwriting discounts
received by the Initial Purchaser, bear to the aggregate offering price of the
Offered Securities. The relative fault of the Company on the one hand and of the
Initial Purchaser 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 or information supplied by the Initial
Purchaser, and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
(e) The Company and the Initial Purchaser agree that it would not be
just or equitable if contribution pursuant to this Section 6 were determined by
PRO RATA allocation or by any other method of allocation that does not take
account of the equitable considerations referred to in Section 6(d) hereof. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in Section 6(d) hereof 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 or defending any such action or claim. Notwithstanding the
provisions of this Section 6, the Initial Purchaser shall not be required to
contribute any amount in excess of the amount by which the total price at which
the Offered Securities resold by it in the initial placement of such Offered
Securities were offered to investors exceeds the amount of any damages that the
Initial Purchaser has 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
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The indemnity and contribution
provisions contained in this Section 6 and the representations and warranties of
the Company contained in this Agreement shall remain operative and in full force
and effect regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of the Initial Purchaser or any person
controlling the Initial Purchaser or by or on behalf of the Company, its
officers or directors or any person controlling the Company, and (iii)
acceptance of and payment for any of the Offered Securities. The remedies
provided for in this Section 6 are not exclusive and shall not limit any rights
or remedies which may otherwise be available to any indemnified party at law or
in equity.
7. SURVIVAL OF CERTAIN REPRESENTATIONS AND OBLIGATIONS. The respective
indemnities, agreements, representations, warranties and other statements of the
Company or its officers and of the Initial Purchaser set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any termination of this Agreement, any investigation, or statement as to the
results thereof, made by or on behalf of the Initial Purchaser, the Company or
any of their respective representatives, officers or directors or any
controlling person and will survive delivery of and payment for the Offered
Securities. If for any reason the purchase of the Offered Securities by the
Initial Purchaser is not consummated, the Company shall remain responsible for
the expenses to be paid or reimbursed by it pursuant to Section 9 hereof and the
respective obligations of the Company and the Initial Purchaser pursuant to
Section 6 hereof shall remain in effect. If the purchase of the Offered
Securities by the Initial Purchaser is not consummated for any reason other than
solely because of the occurrence of the termination of the Agreement pursuant to
Section 8 hereof, the Company will reimburse the Initial Purchaser for all
out-of-pocket expenses (including reasonable fees and disbursements of counsel)
reasonably incurred by the Initial Purchaser in connection with the offering of
such Offered Securities and will comply with its obligations under Sections 6
and 9 hereof.
8. TERMINATION. This Agreement shall be subject to termination by
notice given by the Initial Purchaser to the Company, if (a) after the execution
and delivery of this Agreement and prior to the Closing Date (i) trading
generally shall have been materially suspended or materially limited on or by,
as the case may be, any of the New York Stock Exchange, the American Stock
Exchange or the NASD, (ii) trading of any securities of the Company shall have
been suspended on any exchange or in any over-the-counter market, (iii) a major
disruption of settlements of securities or clearance services in the United
States that would materially impair settlement and clearance with respect to the
Offered Securities, (iv) any general moratorium on commercial banking activities
in New York shall have been declared by either Federal or New York State
authorities or (v) there shall have occurred any attack on, outbreak or
escalation of hostilities or act of terrorism involving, the United States, or
any change in financial markets or any calamity or crisis that, in each case, in
the judgment of the Initial Purchaser, is material and adverse and (b) in the
case of any of the events specified in clauses (a)(i) through (v), such event
singly or together with any other such event makes it, in the judgment of the
Initial Purchaser, impracticable to market the Offered Securities on the terms
and in the manner contemplated in the Final Memorandum.
9. PAYMENT OF EXPENSES. (a) As between the Company and the Initial
Purchaser, the Company shall pay all expenses incidental to the performance of
the Company's obligations under this Agreement, including the following:
(i) expenses incurred in connection with (A) qualifying the Offered
Securities or the Exchange Securities for offer and sale under the
applicable securities or "blue sky" laws of such jurisdictions in the
United States as the Initial Purchaser reasonably designates (including
filing fees and fees and disbursements of counsel for the Initial Purchaser
in connection therewith), (B) endeavoring to maintain such qualifications
in effect so long as required for the distribution of such Offered
Securities, (C) the review (if any) of the offering of the Offered
Securities or the Exchange Securities by the NASD, (D) the determination of
the eligibility of the Offered Securities or the Exchange Securities for
investment under the laws of such jurisdictions as the Initial Purchaser
may designate, (E) the preparation and distribution of any blue sky or
legal investment memorandum by counsel for the Initial Purchaser and (F)
qualifying the Offered Securities for trading in The PortalSM Market of the
Nasdaq Stock Market and any expenses incidental thereto;
(ii) expenses incurred in connection with the preparation and
distribution to the Initial Purchaser and the dealers (whose names and
addresses the Initial Purchaser will furnish to the Company) to which
Offered Securities or Exchange Securities may have been sold by the Initial
Purchaser on its behalf and to any other dealers upon request, of
amendments or supplements to the Final Memorandum (excluding Policy
Provider Information) in order to make the statements therein, in the light
of the circumstances when the Final Memorandum is delivered to a purchaser,
not materially misleading;
(iii) expenses incurred in connection with the preparation, printing
and distribution of the Preliminary Memorandum, the Final Memorandum and
any amendments thereof or supplements thereto (excluding Policy Provider
Information);
(iv) expenses incurred in connection with the preparation, printing
and distribution of this Agreement, the Offered Securities, the Exchange
Securities and the Operative Agreements;
(v) expenses incurred in connection with the delivery of the Offered
Securities to the Initial Purchaser;
(vi) reasonable fees and disbursements of the counsel and accountants
for the Company;
(vii) to the extent the Company is so required under any Operative
Agreement to which it is a party, the fees and expenses of the Trustee, the
Liquidity Provider and the Policy Provider and the reasonable fees and
disbursements of their respective counsel;
(viii) fees charged by rating agencies for rating the Offered
Securities or the Exchange Securities at the Company's request (including
annual surveillance fees related to the Offered Securities or the Exchange
Securities as long as they are outstanding);
(ix) reasonable fees and disbursements of counsel for the Initial
Purchaser in an amount to be agreed between the Initial Purchaser and the
Company;
(x) all fees and expenses relating to appraisals of the Pledged Spare
Parts; and
(xi) all other reasonable out-of-pocket expenses incurred by the
Initial Purchaser in connection with the transactions contemplated by this
Agreement.
(b) In connection with the offering, until the Initial Purchaser shall
have notified the Company of the completion of the resale of the Offered
Securities, neither the Company nor any of its affiliates has bid for or
purchased or will bid for or purchase, either alone or with one or more other
persons, for any account in which it or any of its affiliates has a beneficial
interest any Offered Securities; and neither it nor any of its affiliates will
make bids or purchases for the purpose of creating actual, or apparent, active
trading in, or of raising the price of, the Offered Securities.
10. NOTICES. All communications hereunder will be in writing and, if
sent to the Initial Purchaser, will be mailed, delivered or sent by facsimile
transmission and confirmed to Xxxxxx Xxxxxxx & Co. Incorporated, 0000 Xxxxxxxx,
Xxx Xxxx, XX 00000, Attention: Equipment Finance Group, facsimile number (212)
761-0786 and, if sent to the Company, will be mailed, delivered or sent by
facsimile transmission and confirmed to it at 0000 Xxxxx Xxxxxx, XXXXX, Xxxxxxx,
XX 00000, Attention: Treasurer and General Counsel, facsimile number (713)
324-2447.
11. SUCCESSORS. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
controlling persons referred to in Section 6 hereof, and no other person will
have any right or obligation hereunder.
12. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which will be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
13. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW.
14. JURISDICTION. Each of the parties hereto agrees that any legal
suit, action or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby may be instituted in any U.S. federal or New
York State court in the Borough of Manhattan in The City of New York and each of
the parties hereto hereby irrevocably waives any objection which it may now or
hereafter have to the laying of venue of any such proceeding, and irrevocably
submits to the jurisdiction of such courts, with respect to actions brought
against it as defendant, in any suit, action or proceeding. Each of the parties
to this Agreement agrees that a final judgment in any such suit, action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law in accordance with
applicable law.
15. LIBOR FOR INITIAL INTEREST PERIOD. The interest rate applicable
for the initial Interest Period under the Indenture shall be LIBOR, determined
by the Initial Purchaser as the rate for deposits in U.S. dollars for a period
of three months which appears on the Telerate Page 3750 as of 11:00 a.m., London
time, on December 4, 2002.
If the foregoing is in accordance with the Initial Purchaser's
understanding of our agreement, kindly sign and return to the Company one of the
counterparts hereof, whereupon it will become a binding agreement between the
Initial Purchaser and the Company in accordance with its terms.
Very truly yours,
CONTINENTAL AIRLINES, INC.
By:
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Name: Xxxxxx Xxxxxxxx
Title: Senior Vice President-Finance
The foregoing Purchase Agreement
is hereby confirmed and accepted
as of the date first above written:
XXXXXX XXXXXXX & CO. INCORPORATED
By:
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Name:
Title:
