Exhibit 10(a)
THE ADVEST GROUP, INC.
Note Purchase Agreement
Dated as of December 27, 1996
$35,000,000 7.95% Senior Notes Due December 31, 2003
TABLE OF CONTENTS
PAGE
1. AUTHORIZATION OF NOTES 1
2. SALE AND PURCHASE OF NOTES 1
3. CLOSING 2
4. CONDITIONS TO CLOSING 2
4.1 Representations and Warranties 2
4.2 Performance; No Default 2
4.3 Compliance Certificates 2
4.4 Opinions of Counsel 3
4.5 Purchase Permitted By Applicable Law, etc. 3
4.6 Sale of Other Notes 3
4.7 Payment of Special Counsel Fees 3
4.8 Private Placement Number 4
4.9 Changes in Corporate Structure 4
4.10 Proceedings and Documents 4
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY 4
5.1 Organization; Power and Authority 4
5.2 Authorization, etc. 4
5.3 Disclosure 5
5.4 Organization and Ownership of Shares of
Subsidiaries; Affiliates 5
5.5 Financial Statements 6
5.6 Compliance with Laws, Other Instruments, etc. 6
5.7 Governmental Authorizations, etc. 7
5.8 Litigation; Observance of Agreements, Statutes
and Orders 7
5.9 Taxes 7
5.10 Title to Property; Leases 7
5.11 Licenses, Permits, etc. 8
5.12 Compliance with ERISA 8
5.13 Private Offering by the Company 9
5.14 Use of Proceeds; Margin Regulations 9
5.15 Existing Debt; Future Liens 10
5.16 Foreign Assets Control Regulations, etc. 10
5.17 Status under Certain Statutes 10
5.18 Environmental Matters 10
5.19 Membership in the NYSE, Etc. 11
5.20 Regulation T. 11
5.21 SIPC Assessments. 11
6. REPRESENTATIONS OF THE PURCHASER 11
6.1 Purchase for Investment 11
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TABLE OF CONTENTS (cont.)
PAGE
6.2 Source of Funds 12
7. INFORMATION AS TO COMPANY 13
7.1 Financial and Business Information 13
7.2 Officer's Certificate 16
7.3 Inspection 16
8. PAYMENT OF THE NOTES 17
8.1 Required Prepayments; Payment at Maturity 17
8.2 Optional Prepayments with Make-Whole Amount 17
8.3 Allocation of Partial Prepayments 18
8.4 Maturity; Surrender, etc. 18
8.5 No Other Optional Prepayments or Purchase of Notes 18
8.6 Make-Whole Amount 18
9. AFFIRMATIVE COVENANTS 19
9.1 Compliance with Law 20
9.2 Insurance 20
9.3 Maintenance of Properties 20
9.4 Payment of Taxes and Claims 20
9.5 Corporate Existence, etc. 21
10. NEGATIVE COVENANTS 21
10.1 Transactions with Affiliates 21
10.2 Consolidated Net Worth 21
10.3 Maintenance of Consolidated Senior Funded Debt 21
10.4 Maintenance of Consolidated Subsidiary Debt 22
10.5 Maintenance of Consolidated Funded Debt 22
10.6 Liens 22
10.7 Required Net Capital 24
10.8 Line of Business 24
10.9 Maintenance of Ownership 24
10.10 Merger, Consolidation, etc 24
10.11 Xxxxxxxxxx 00
00. EVENTS OF XXXXXXX 00
00. REMEDIES ON DEFAULT, ETC. 28
12.1 Acceleration 28
12.2 Other Remedies 29
12.3 Rescission 29
12.4 No Waivers or Election of Remedies, Expenses, etc. 29
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES 29
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TABLE OF CONTENTS (cont.)
PAGE
13.1 Registration of Notes 29
13.2 Transfer and Exchange of Notes 30
13.3 Replacement of Notes 30
14. PAYMENTS ON NOTES 31
14.1 Place of Payment 31
14.2 Home Office Payment 31
15. EXPENSES, ETC. 31
15.1 Transaction Expenses 31
15.2 Survival 32
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE
AGREEMENT 32
17. AMENDMENT AND WAIVER 32
17.1 Requirements 32
17.2 Solicitation of Holders of Notes 33
17.3 Binding Effect, etc. 33
17.4 Notes held by Company, etc. 33
18. NOTICES 33
19. REPRODUCTION OF DOCUMENTS 34
20. CONFIDENTIAL INFORMATION 34
21. SUBSTITUTION OF PURCHASER 36
22. MISCELLANEOUS 36
22.1 Successors and Assigns 36
22.2 Payments Due on Non-Business Days 36
22.3 Severability 36
22.4 Construction 37
22.5 Counterparts 37
22.6 Governing Law 37
SCHEDULE A -- Information Relating to Purchasers
SCHEDULE B -- Defined Terms
SCHEDULE 4.9 -- Changes in Corporate Structure
SCHEDULE 5.3 -- Disclosure Materials
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SCHEDULE 5.4 -- Subsidiaries of the Company and
Ownership of Subsidiary Stock
SCHEDULE 5.5 -- Financial Statements
SCHEDULE 5.8 -- Certain Litigation
SCHEDULE 5.11 -- Patents, etc.
SCHEDULE 5.12 -- ERISA Affiliates
SCHEDULE 5.14 -- Use of Proceeds
SCHEDULE 5.15 -- Existing Debt and Liens
EXHIBIT 1 -- Form of 7.95% Senior Note due
December 31, 2003
EXHIBIT 4.4(a) -- Form of Opinion of Special Counsel
for the Company
EXHIBIT 4.4(b) -- Form of Opinion of General Counsel
of the Company
EXHIBIT 4.4(c) -- Form of Opinion of Special Counsel
for the Purchasers
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THE ADVEST GROUP, INC.
00 Xxxxx Xxxxx Xxxxxx
0xx Xxxxx
Xxxxxxxx, XX 00000-0000
7.95% Senior Notes Due December 31, 2003
Dated as of December 27, 1996
To the Purchaser Named on
the Signature Page Hereto
Ladies and Gentlemen:
THE ADVEST GROUP, INC., a Delaware corporation (together with its
successors and assigns, the "Company"), agrees with you as follows:
1. AUTHORIZATION OF NOTES.
The Company will authorize the issue and sale of $35,000,000
aggregate principal amount of its 7.95% Senior Notes due December 31,
2003 (the "Notes", such term to include any such notes issued in
substitution therefor pursuant to Section 13 of this Agreement or the
Other Agreements (as hereinafter defined)). The Notes shall be
substantially in the form set out in Exhibit 1, with such changes
therefrom, if any, as may be approved by you and the Company. Certain
capitalized terms used in this Agreement are defined in Schedule B;
references to a "Schedule" or an "Exhibit" are, unless otherwise
specified, to a Schedule or an Exhibit attached to this Agreement.
2. SALE AND PURCHASE OF NOTES.
Subject to the terms and conditions of this Agreement, the Company
will issue and sell to you and you will purchase from the Company, at
the Closing provided for in Section 3, Notes in the principal amount
specified below your name in Schedule A at the purchase price of 100%
of the principal amount thereof. Contemporaneously with entering into
this Agreement, the Company is entering into separate Note Purchase
Agreements (the "Other Agreements") identical with this Agreement with
each of the other purchasers named in Schedule A (the "Other
Purchasers"), providing for the sale at such Closing to each of the
Other Purchasers of Notes in the principal amount specified below its
name in Schedule A. Your obligation hereunder and the obligations of
the Other Purchasers under the Other Agreements are several and not
joint obligations and you shall have no obligation under any Other
Agreement and no liability to any Person for the performance or non-
performance by any Other Purchaser thereunder.
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3. CLOSING.
The sale and purchase of the Notes to be purchased by you and the
Other Purchasers shall occur at the offices of Xxxx & Xxxxxx, Xxx Xxxxx
Xxxxxx, Xxxxxxxx, Xxxxxxxxxxx 00000, at 10:00 a.m., local time, at a
closing (the "Closing") on December 27, 1996 or on such other Business
Day thereafter on or prior to December 31, 1996 as may be agreed upon
by the Company and you and the Other Purchasers. At the Closing the
Company will deliver to you the Notes to be purchased by you in the
form of a single Note (or such greater number of Notes in denominations
of at least $500,000 as you may request) dated the date of the Closing
and registered in your name (or in the name of your nominee), against
delivery by you to the Company or its order of immediately available
funds in the amount of the purchase price therefor by wire transfer of
immediately available funds for the account of the Company to account
number 00000000 at Bankers Trust Company, New York, New York, ABA #
000000000. If at the Closing the Company shall fail to tender such
Notes to you as provided above in this Section 3, or any of the
conditions specified in Section 4 shall not have been fulfilled to your
satisfaction, you shall, at your election, be relieved of all further
obligations under this Agreement, without thereby waiving any rights
you may have by reason of such failure or such nonfulfillment.
4. CONDITIONS TO CLOSING.
Your obligation to purchase and pay for the Notes to be sold to
you at the Closing is subject to the fulfillment to your satisfaction,
prior to or at the Closing, of the following conditions:
4.1. Representations and Warranties.
The representations and warranties of the Company in this
Agreement shall be correct when made and at the time of the Closing.
4.2. Performance; No Default.
The Company shall have performed and complied with all agreements
and conditions contained in this Agreement required to be performed or
complied with by it prior to or at the Closing and after giving effect
to the issue and sale of the Notes (and the application of the proceeds
thereof as contemplated by Schedule 5.14) no Default or Event of
Default shall have occurred and be continuing. Neither the Company nor
any Subsidiary shall have entered into any transaction since the date
of the Memorandum that would have been prohibited by any of Sections
10.1, 10.6, 10.10 or 10.11 had such Sections applied since such date.
4.3. Compliance Certificates.
(a) Officer's Certificate. The Company shall have delivered
to you an Officer's Certificate, dated the date of the Closing,
certifying that the conditions specified in Sections 4.1, 4.2 and
4.9 have been fulfilled.
(b) Secretary's Certificate. The Company shall have
delivered to you a certificate of its Secretary or one of its
Assistant Secretaries, dated the date of the Closing, certifying
as to the resolutions attached thereto and other corporate
proceedings relating to the authorization, execution and delivery
of the Notes, this Agreement and the Other Agreements.
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4.4. Opinions of Counsel.
You shall have received opinions in form and substance
satisfactory to you, dated the date of the Closing,
(a) from Day, Xxxxx & Xxxxxx, counsel for the Company,
substantially in the form set out in Exhibit 4.4(a) and covering
such other matters incident to the transactions contemplated
hereby as you or your counsel may reasonably request (and the
Company hereby instructs such counsel to deliver such opinion to
you), and
(b) from Xxx X. Xxxxxx, General Counsel of the Company,
substantially in the form set out in Exhibit 4.4(b) and covering
such other matters incident to the transactions contemplated
hereby as you or your counsel may reasonably request, and
(c) from Xxxx & Xxxxxx, your special counsel in connection
with such transactions, substantially in the form set out in
Exhibit 4.4(c) and covering such other matters incident to such
transactions as you may reasonably request.
4.5. Purchase Permitted By Applicable Law, etc.
On the date of the Closing your purchase of Notes shall (a) be
permitted by the laws and regulations of each jurisdiction to which you
are subject, without recourse to provisions (such as section 1405(a)(8)
of the New York Insurance Law) permitting limited investments by
insurance companies without restriction as to the character of the
particular investment, (b) not violate any applicable law or regulation
(including, without limitation, Regulation G, T or X of the Board of
Governors of the Federal Reserve System) and (c) not subject you to any
tax, penalty or liability under or pursuant to any applicable law or
regulation, which law or regulation was not in effect on the date of
your execution and delivery of this Agreement. If requested by you,
you shall have received an Officer's Certificate certifying as to such
matters of fact as you may reasonably specify to enable you to
determine whether such purchase is so permitted.
4.6. Sale of Other Notes.
Contemporaneously with the Closing the Company shall sell to the
Other Purchasers and the Other Purchasers shall purchase the Notes to
be purchased by them at the Closing as specified in Schedule A.
4.7. Payment of Special Counsel Fees.
Without limiting the provisions of Section 15.1, the Company shall
have paid on or before the Closing the fees, charges and disbursements
of your special counsel referred to in Section 4.4 to the extent
reflected in a statement of such counsel rendered to the Company at
least one Business Day prior to the date of the Closing.
4.8. Private Placement Number.
A Private Placement Number issued by Standard & Poor's CUSIP
Service Bureau (in cooperation with the Securities Valuation Office of
the National Association of Insurance Commissioners) shall have been
obtained for the Notes.
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4.9. Changes in Corporate Structure.
Except as specified in Schedule 4.9, the Company shall not have
changed its jurisdiction of incorporation or been a party to any merger
or consolidation and shall not have succeeded to all or any substantial
part of the liabilities of any other entity, at any time following the
date of the most recent financial statements referred to in Schedule
5.5.
4.10. Proceedings and Documents.
All corporate and other proceedings in connection with the
transactions contemplated by this Agreement and all documents and
instruments incident to such transactions shall be reasonably
satisfactory to you and your special counsel, and you and your special
counsel shall have received all such counterpart originals or certified
or other copies of such documents as you or they may reasonably
request.
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to you, as of the date of the
Closing, that:
5.1. Organization; Power and Authority.
The Company is a corporation duly organized, validly existing and
in good standing under the laws of its jurisdiction of incorporation,
and is duly qualified as a foreign corporation and is in good standing
in each jurisdiction in which such qualification is required by law,
other than those jurisdictions as to which the failure to be so
qualified or in good standing could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
The Company has the corporate power and authority to own or hold under
lease the properties it purports to own or hold under lease, to
transact the business it transacts and proposes to transact, to execute
and deliver this Agreement and the Other Agreements and the Notes and
to perform the provisions hereof and thereof.
5.2. Authorization, etc.
This Agreement and the Other Agreements and the Notes have been
duly authorized by all necessary corporate action on the part of the
Company, and this Agreement constitutes, and upon execution and
delivery thereof each Note will constitute, a legal, valid and binding
obligation of the Company enforceable against the Company in accordance
with its terms, except as such enforceability may be limited by (a)
applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors' rights generally
and (b) general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
5.3. Disclosure.
The Company, through its agents, Ironwood Capital Partners, Ltd.
and Advest, Inc., have delivered to you and each Other Purchaser a
copy of a private placement memorandum, dated March 25, 1996 (the
"Memorandum"), relating to the transactions contemplated hereby. The
Memorandum fairly describes, in all material respects, the general
nature of the business and principal properties of the Company and its
Subsidiaries. Except as disclosed in Schedule 5.3, this Agreement, the
Memorandum, the documents, certificates or other writings delivered to
you by or on behalf of the Company in connection with the transactions
contemplated hereby and the financial statements listed in Schedule
5.5, taken as a whole, do not contain any untrue statement of a
4
material fact or omit to state any material fact necessary to make the
statements therein not misleading in light of the circumstances under
which they were made. Except as disclosed in the Memorandum or as
expressly described in Schedule 5.3, or in one of the documents,
certificates or other writings identified therein, or in the financial
statements listed in Schedule 5.5, since September 30, 1996, there has
been no change in the financial condition, operations, business,
properties or prospects of the Company or any Subsidiary except changes
that individually or in the aggregate could not reasonably be expected
to have a Material Adverse Effect. There is no fact known to the
Company that could reasonably be expected to have a Material Adverse
Effect that has not been set forth herein or in the Memorandum or in
the other documents, certificates and other writings delivered to you
by or on behalf of the Company specifically for use in connection with
the transactions contemplated hereby.
5.4. organization and Ownership of Shares of Subsidiaries;
Affiliates.
(a) Schedule 5.4 contains (except as noted therein) complete
and correct lists of (i) the Company's Subsidiaries, showing, as
to each Subsidiary, the correct name thereof, the jurisdiction of
its organization, and the percentage of shares of each class of
its capital stock or similar equity interests outstanding owned by
the Company and each other Subsidiary and (ii) the Company's
Affiliates (other than Subsidiaries and Affiliates of the type
described in clause (d) of the definition of "Affiliate" in
Schedule B).
(b) All of the outstanding shares of capital stock or
similar equity interests of each Subsidiary shown in Schedule 5.4
as being owned by the Company and its Subsidiaries have been
validly issued, are fully paid and nonassessable and are owned by
the Company or another Subsidiary free and clear of any Lien
(except as otherwise disclosed in Schedule 5.4).
(c) Each Subsidiary identified in Schedule 5.4 is a
corporation or other legal entity duly organized, validly existing
and in good standing under the laws of its jurisdiction of
organization, and is duly qualified as a foreign corporation or
other legal entity and is in good standing in each jurisdiction in
which such qualification is required by law, other than those
jurisdictions as to which the failure to be so qualified or in
good standing could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. Each
such Subsidiary has the corporate or other power and authority to
own or hold under lease the properties it purports to own or hold
under lease and to transact the business it transacts and proposes
to transact except in such cases where the failure to have such
power and authority, individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect.
(d) No Subsidiary is a party to, or otherwise subject to any
legal restriction or any agreement (other than this Agreement, the
agreements listed in Schedule 5.4, limitations imposed on broker
dealers generally by the NYSE and the SEC and customary
limitations imposed by corporate law statutes) restricting the
ability of such Subsidiary to pay dividends out of profits or make
any other similar distributions of profits to the Company or any
of its Subsidiaries that owns outstanding shares of capital stock
or similar equity interests of such Subsidiary.
(e) The revenues of the Material Subsidiaries for the twelve
month period ended November 30, 1996 account for more than 95% of
the consolidated revenues of the Company and its Subsidiaries for
such period. The assets of the Material Subsidiaries as of the
date of Closing constitute not less than 95% of the consolidated
assets of the Company and its Subsidiaries as of such date.
5.5. Financial Statements.
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The Company has delivered to you and each Other Purchaser copies
of the financial statements of the Company and its Subsidiaries listed
in Schedule 5.5. All of said financial statements (including in each
case the related schedules and notes) fairly present in all material
respects the consolidated financial position of the Company and its
Subsidiaries as of the respective dates specified in such Schedule and
the consolidated results of their operations and cash flows for the
respective periods so specified and have been prepared in accordance
with GAAP consistently applied throughout the periods involved except
as set forth in the notes thereto (subject, in the case of any interim
financial statements, to normal year-end adjustments).
5.6. Compliance with Laws, Other Instruments, etc.
The execution, delivery and performance by the Company of
this Agreement and the Notes will not
(a) contravene, result in any breach of, or constitute a
default under, or result in the creation of any Lien in respect of
any property of the Company or any Subsidiary under, any
indenture, mortgage, deed of trust, loan, purchase or credit
agreement, lease, corporate charter or by-laws, or any other
agreement or instrument to which the Company or any Subsidiary is
bound or by which the Company or any Subsidiary or any of their
respective properties may be bound or affected,
(b) conflict with or result in a breach of any of the terms,
conditions or provisions of any order, judgment, decree, or ruling
of any court, arbitrator or Governmental Authority applicable to
the Company or any Subsidiary, or
(c) violate any provision of any statute or other rule or
regulation of any Governmental Authority applicable to the Company
or any Subsidiary.
5.7. Governmental Authorizations, etc.
No consent, approval or authorization of, or registration, filing
or declaration with, any Governmental Authority is required in
connection with the execution, delivery or performance by the Company
of this Agreement or the Notes.
5.8. Litigation; Observance of Agreements, Statutes and
Orders.
(a) Except as disclosed in Schedule 5.8, there are no
actions, suits or proceedings pending or, to the knowledge of the
Company, threatened against or affecting the Company or any
Subsidiary or any property of the Company or any Subsidiary in any
court or before any arbitrator of any kind or before or by any
Governmental Authority that, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect.
(b) Neither the Company nor any Subsidiary is in default
under any term of any agreement or instrument to which it is a
party or by which it is bound, or any order, judgment, decree or
ruling of any court, arbitrator or Governmental Authority or is in
violation of any applicable law, ordinance, rule or regulation
(including, without limitation, Environmental Laws) of any
Governmental Authority, which default or violation, individually
or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
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5.9. Taxes.
The Company and its Subsidiaries have filed all tax returns that
are required to have been filed in any jurisdiction, and have paid all
taxes shown to be due and payable on such returns and all other taxes
and assessments levied upon them or their properties, assets, income or
franchises, to the extent such taxes and assessments have become due
and payable and before they have become delinquent, except for any
taxes and assessments the amount of which is not individually or in
the aggregate Material or the amount, applicability or validity of
which is currently being contested in good faith by appropriate
proceedings and with respect to which the Company or a Subsidiary, as
the case may be, has established adequate reserves in accordance with
GAAP. The Company knows of no basis for any other tax or assessment
that could reasonably be expected to have a Material Adverse Effect.
The charges, accruals and reserves on the books of the Company and its
Subsidiaries in respect of Federal, state or other taxes for all fiscal
periods are adequate. The Federal income tax liabilities of the
Company and its Subsidiaries have been determined by the Internal
Revenue Service and paid for all fiscal years up to and including the
fiscal year ended September 30, 1992.
5.10. Title to Property; Leases.
The Company and its Subsidiaries have good and sufficient title to
their respective properties that individually or in the aggregate are
Material, including all such properties reflected in the most recent
audited balance sheet referred to in Section 5.5 or purported to have
been acquired by the Company or any Subsidiary after said date (except
as sold or otherwise disposed of in the ordinary course of business),
in each case free and clear of Liens prohibited by this Agreement. All
leases that individually or in the aggregate are Material are valid and
subsisting and are in full force and effect in all material respects.
5.11. Licenses, Permits, etc.
Except as disclosed in Schedule 5.11,
(a) the Company and its Subsidiaries own or possess all
licenses, permits, franchises, authorizations, patents,
copyrights, service marks, trademarks and trade names, or rights
thereto, that individually or in the aggregate are Material,
without known conflict with the rights of others;
(b) to the best knowledge of the Company, no product or
practice of the Company or any Subsidiary infringes in any
material respect any license, permit, franchise, authorization,
patent, copyright, service xxxx, trademark, trade name or other
right owned by any other Person; and
(c) to the best knowledge of the Company, there is no
Material violation by any Person of any right of the Company or
any of its Subsidiaries with respect to any patent, copyright,
service xxxx, trademark, trade name or other right owned or used
by the Company or any of its Subsidiaries.
5.12. Compliance with ERISA.
(a) The Company and each ERISA Affiliate have operated and
administered each Plan in compliance with all applicable laws
except for such instances of noncompliance as have not resulted in
and could not reasonably be expected to result in a Material
Adverse Effect. Neither the Company nor any ERISA Affiliate has
incurred any liability pursuant to Title I or IV of ERISA or the
penalty or excise tax provisions of the Code relating to employee
benefit plans (as defined in section 3 of ERISA), and no event,
transaction or condition has occurred or exists that could
reasonably be expected to result in
7
the incurrence of any such liability by the Company or any ERISA
Affiliate, or in the imposition of any Lien on any of the rights,
properties or assets of the Company or any ERISA Affiliate, in
either case pursuant to Title I or IV of ERISA or to such penalty
or excise tax provisions or to section 401(a)(29) or 412 of the
Code, other than such liabilities or Liens as would not be
individually or in the aggregate Material.
(b) The present value of the aggregate benefit liabilities
under each of the Plans subject to Title IV of ERISA (other than
Multiemployer Plans), determined as of the end of such Plan's most
recently ended plan year on the basis of the actuarial assumptions
specified for funding purposes in such Plan's most recent
actuarial valuation report, did not exceed the aggregate current
value of the assets of such Plan allocable to such benefit
liabilities. The term "benefit liabilities" has the meaning
specified in section 4001 of ERISA and the terms "current value"
and "present value" have the meaning specified in section 3 of
ERISA.
(c) The Company and the ERISA Affiliates have not incurred
withdrawal liabilities (and are not subject to contingent
withdrawal liabilities) under section 4201 or 4204 of ERISA in
respect of Multiemployer Plans that individually or in the
aggregate are Material.
(d) The expected postretirement benefit obligation
(determined as of the last day of the Company's most recently
ended fiscal year in accordance with Financial Accounting
Standards Board Statement No. 106, without regard to liabilities
attributable to continuation coverage mandated by section 4980B of
the Code) of the Company and its Subsidiaries is not Material.
(e) The execution and delivery of this Agreement and the
issuance and sale of the Notes hereunder will not involve any
transaction that is subject to the prohibitions of section 406 of
ERISA or in connection with which a tax could be imposed pursuant
to section 4975(c)(1)(A)-(D) of the Code. The representation by
the Company in the first sentence of this Section 5.12(e) is made
in reliance upon and subject to the accuracy of your
representation in Section 6.2 as to the sources of the funds used
to pay the purchase price of the Notes to be purchased by you.
(f) Schedule 5.12 sets forth all ERISA Affiliates and all
"employee benefit plans" maintained by the Company (or any
"affiliate" thereof) or in respect of which the Notes could
constitute an "employer security" ("employee benefit plan" has the
meaning specified in section 3 of ERISA, "affiliate" has the
meaning specified in section 407(d) of ERISA and section V of the
Department of Labor Prohibited Transaction Exemption 95-60 (60 FR
35925, July 12, 1995) and "employer security" has the meaning
specified in section 407(d) of ERISA).
5.13. Private Offering by the Company.
Neither the Company nor anyone acting on its behalf has offered
the Notes or any similar securities for sale to, or solicited any offer
to buy any of the same from, or otherwise approached or negotiated in
respect thereof with, any Person other than you, the Other Purchasers
and not more than 100 other Institutional Investors, each of which has
been offered the Notes at a private sale for investment. Neither the
Company nor anyone acting on its behalf has taken, or will take, any
action that would subject the issuance or sale of the Notes to the
registration requirements of section 5 of the Securities Act.
8
5.14. Use of Proceeds; Margin Regulations.
The Company will apply the proceeds of the sale of the Notes as
set forth in Schedule 5.14. No part of the proceeds from the sale of
the Notes hereunder will be used, directly or indirectly, for the
purpose of buying or carrying any margin stock within the meaning of
Regulation G of the Board of Governors of the Federal Reserve System
(12 CFR 207), or for the purpose of buying or carrying or trading in
any securities under such circumstances as to involve the Company in a
violation of Regulation X of said Board (12 CFR 224) or to involve any
broker or dealer in a violation of Regulation T of said Board (12 CFR
220). Margin stock which is owned by the Company or its Subsidiaries
for their own accounts does not constitute more than 1% of the value of
the consolidated assets of the Company and its Subsidiaries and the
Company does not have any present intention that margin stock which is
owned by the Company or its Subsidiaries for their own accounts will
constitute more than 1% of the value of such assets. As used in this
Section, the terms "margin stock" and "purpose of buying or carrying"
shall have the meanings assigned to them in said Regulation G.
5.15. Existing Debt; Future Liens.
(a) Except as described therein, Schedule 5.15 sets forth a
complete and correct list of all outstanding Debt of the Company
and its Subsidiaries as of September 30, 1996 (and specifying, as
to each such Debt, the collateral, if any, securing such Debt),
since which date there has been no Material change in the amounts,
interest rates, sinking funds, instalment payments or maturities
of the Debt of the Company or its Subsidiaries. Neither the
Company nor any Subsidiary is in default and no waiver of default
is currently in effect, in the payment of any principal or
interest on any Debt of the Company or such Subsidiary and no
event or condition exists with respect to any Debt of the Company
or any Subsidiary that would permit (or that with notice or the
lapse of time, or both, would permit) one or more Persons to cause
such Debt to become due and payable before its stated maturity or
before its regularly scheduled dates of payment.
(b) Except as disclosed in Schedule 5.15, neither the
Company nor any Subsidiary has agreed or consented to cause or
permit in the future (upon the happening of a contingency or
otherwise) any of its property, whether now owned or hereafter
acquired, to be subject to a Lien not permitted by Section 10.6.
5.16. Foreign Assets Control Regulations, etc.
Neither the sale of the Notes by the Company hereunder nor its use
of the proceeds thereof will violate the Trading with the Enemy Act, as
amended, or any of the foreign assets control regulations of the United
States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended)
or any enabling legislation or executive order relating thereto.
5.17. Status under Certain Statutes.
Neither the Company nor any Subsidiary is subject to regulation
under the Investment Company Act of 1940, as amended, as an investment
company, the Public Utility Holding Company Act of 1935, as amended,
the Transportation Acts (49 U.S.C.), as amended, or the Federal Power
Act, as amended.
9
5.18. Environmental Matters.
Neither the Company nor any Subsidiary has knowledge of any claim
or has received any notice of any claim, and no proceeding has been
instituted raising any claim against the Company or any of its
Subsidiaries or any of their respective real properties now or formerly
owned, leased or operated by any of them or other assets, alleging any
damage to the environment or violation of any Environmental Laws,
except, in each case, such as could not reasonably be expected to
result in a Material Adverse Effect. Except as otherwise disclosed to
you in writing,
(a) neither the Company nor any Subsidiary has knowledge of
any facts which would give rise to any claim, public or private,
of violation of Environmental Laws or damage to the environment
emanating from, occurring on or in any way related to real
properties now or formerly owned, leased or operated by any of
them or to other assets or their use, except, in each case, such
as could not reasonably be expected to result in a Material
Adverse Effect;
(b)neither the Company nor any of its Subsidiaries has stored
any Hazardous Materials on real properties now or formerly owned,
leased or operated by any of them and has not disposed of any
Hazardous Materials in a manner contrary to any Environmental Laws
in each case in any manner that could reasonably be expected to
result in a Material Adverse Effect; and
(c) all buildings on all real properties now owned, leased
or operated by the Company or any of its Subsidiaries are in
compliance with applicable Environmental Laws, except where
failure to comply could not reasonably be expected to result in a
Material Adverse Effect.
5.19. Membership in the NYSE, Etc.
Each Broker-Dealer Subsidiary is registered as a broker-dealer
with the SEC under the Exchange Act and with state securities
authorities in each state where such Broker-Dealer Subsidiary is
required to be so registered. Each Broker-Dealer Subsidiary is a
member organization in good standing of the NYSE and the NASD.
5.20. Regulation T.
Each Broker-Dealer Subsidiary is a broker-dealer subject to the
provisions of Regulation T (12 C.F.R. 220) of the Board of Governors of
the Federal Reserve System. Each Broker-Dealer Subsidiary maintains
procedures and internal controls designed to ensure that such Broker-
Dealer Subsidiary does not extend or maintain credit to or for its
customers other than in accordance with the provisions of said
Regulation T, and each Broker-Dealer Subsidiary regularly supervises
the activities of such Person, and the activities of employees of
thereof, to ensure that such Broker-Dealer Subsidiary does not extend
or maintain credit to or for its customers other than in accordance
with the provisions of said Regulation T.
5.21. SIPC Assessments.
None of the Broker-Dealer Subsidiaries is in arrears with respect to
any assessment made by the SIPC.
10
6. REPRESENTATIONS OF THE PURCHASER.
6.1. Purchase for Investment.
You represent that you are purchasing the Notes for your own
account or for one or more separate accounts maintained by you or for
the account of one or more pension or trust funds and not with a view
to the distribution thereof, provided that the disposition of your or
their property shall at all times be within your or their control. You
understand that the Notes have not been registered under the Securities
Act or any state securities or "Blue Sky" laws and may be resold only
if registered pursuant to the provisions of the Securities Act and any
applicable state securities or "Blue Sky" laws or if an exemption from
registration is available, except under circumstances where neither
such registration nor such an exemption is required by law, and that
the Company is not required to register the Notes.
6.2. Source of Funds.
You represent that at least one of the following statements is an
accurate representation as to each source of funds (a "Source") to be
used by you to pay the purchase price of the Notes to be purchased by
you hereunder:
(a) the Source is an "insurance company general account" as
defined in Department of Labor Prohibited Transaction Exemption 95-
60 (60 FR 35925, July 12, 1995) and in respect thereof you
represent that there is no "employee benefit plan" (as defined in
section 3(3) of ERISA and section 4975(e)(1) of the IRC, treating
as a single plan all plans maintained by the same employer or
employee organization or affiliate thereof) with respect to which
the amount of the general account reserves and liabilities of all
contracts held by or on behalf of such plan exceed ten percent
(10%) of the total reserves and liabilities of such general account
(exclusive of separate account liabilities) plus surplus, as set
forth in the NAIC Annual Statement filed with your state of
domicile and that such acquisition is eligible for and satisfies
the other requirements of such exemption; or
(b) if you are an insurance company, the Source does not
include assets allocated to any separate account maintained by you
in which any employee benefit plan (or its related trust) has any
interest, other than a separate account that is maintained solely
in connection with your fixed contractual obligations under which
the amounts payable, or credited, to such plan and to any
participant or beneficiary of such plan (including any annuitant)
are not affected in any manner by the investment performance of the
separate account; or
(c) the Source is either (i) an insurance company pooled
separate account, within the meaning of Prohibited Transaction
Exemption ("PTE") 00-0 (xxxxxx Xxxxxxx 00, 0000), xx (xx) a bank
collective investment fund, within the meaning of the PTE 91-38
(issued July 12, 1991) and, except as you have disclosed to the
Company in writing pursuant to this paragraph (c), no employee
benefit plan or group of plans maintained by the same employer or
employee organization beneficially owns more than 10% of all assets
allocated to such pooled separate account or collective investment
fund; or
(d) the Source constitutes assets of an "investment fund
"(within the meaning of Part V of the QPAM Exemption) managed by a
"qualified professional asset manager" or "QPAM" (within the
meaning of Part V of the QPAM Exemption), no employee benefit
plan's assets that are included in such investment fund, when
combined with the assets of all other employee benefit plans
established or maintained by the same employer or by an affiliate
(within the meaning of Section V(c)(1) of the QPAM Exemption) of
such employer or by the same employee organization and managed by
such QPAM,
11
exceed 20% of the total client assets managed by such QPAM, the
conditions of Part I(c) and (g) of the QPAM Exemption are
satisfied, neither the QPAM nor a person controlling or controlled
by the QPAM (applying the definition of "control" in Section V(e)
of the QPAM Exemption) owns a 5% or more interest in the Company
and
(i) the identity of such QPAM and
(ii) the names of all employee benefit plans whose
assets are included in such investment fund have been
disclosed to the Company in writing pursuant to this
paragraph (d); or
(e) the Source is a governmental plan; or
(f) the Source is one or more employee benefit plans, or a
separate account or trust fund comprised of one or more employee
benefit plans, each of which has been identified to the Company in
writing pursuant to this paragraph (f); or
(g) the Source does not include assets of any employee
benefit plan, other than a plan exempt from the coverage of ERISA.
As used in this Section 6.2, the terms "employee benefit plan",
"governmental plan", "party in interest" and "separate account" shall
have the respective meanings assigned to such terms in Section 3 of
ERISA.
7. INFORMATION AS TO COMPANY.
7.1. Financial and Business Information.
The Company shall deliver to each holder of Notes that is an
Institutional Investor:
(a) Quarterly Statements -- within 60 days after the end of
each quarterly fiscal period in each fiscal year of the Company
(other than the last quarterly fiscal period of each such fiscal
year), duplicate copies of,
(i) a consolidated balance sheet of the Company and its
Subsidiaries as at the end of such quarter, and
(ii) consolidated statements of income, changes in
shareholders' equity and cash flows of the Company and its
Subsidiaries, for such quarter and (in the case of the second
and third quarters) for the portion of the fiscal year ending
with such quarter,
setting forth in each case in comparative form the figures for the
corresponding periods in the previous fiscal year, all in
reasonable detail, prepared in accordance with GAAP applicable to
quarterly financial statements generally, and certified by a
Senior Financial Officer as fairly presenting, in all material
respects, consolidated the financial position of the companies
being reported on and their consolidated results of operations and
cash flows, subject to changes resulting from year-end
adjustments, provided that delivery within the time period
specified above of copies of the Company's Quarterly Report on
Form 10-Q prepared in compliance with the requirements therefor
and filed with the Securities and Exchange Commission shall be
deemed to satisfy the requirements of this Section 7.1(a);
12
(b) Annual Statements -- within 105 days after the end of
each fiscal year of the Company, duplicate copies of,
(i) a consolidated balance sheet of the Company and its
Subsidiaries, as at the end of such year, and
(ii) consolidated statements of income, changes in
shareholders' equity and cash flows of the Company and its
Subsidiaries, for such year,
setting forth in each case in comparative form the figures for the
previous fiscal year, all in reasonable detail, prepared in accordance
with GAAP, and accompanied by
(A) an opinion thereon of independent certified
public accountants of recognized national standing, which
opinion shall state that such financial statements present
fairly, in all material respects, the consolidated
financial position of the companies being reported upon
and their consolidated results of operations and cash
flows and have been prepared in conformity with GAAP, and
that the examination of such accountants in connection
with such financial statements has been made in accordance
with generally accepted auditing standards, and that such
audit provides a reasonable basis for such opinion in the
circumstances, and
(B) a certificate of such accountants stating that
they have reviewed this Agreement and stating further
whether, in making their audit, they have become aware of
any condition or event that then constitutes a Default or
an Event of Default, and, if they are aware that any such
condition or event then exists, specifying the nature and
period of the existence thereof (it being understood that
such accountants shall not be liable, directly or
indirectly, for any failure to obtain knowledge of any
Default or Event of Default unless such accountants should
have obtained knowledge thereof in making an audit in
accordance with generally accepted auditing standards or
did not make such an audit),
provided that the delivery within the time period specified above
of the Company's Annual Report on Form 10-K for such fiscal year
prepared in accordance with the requirements therefor and filed
with the Securities and Exchange Commission, together with the
accountant's certificate described in clause (B) above, shall be
deemed to satisfy the requirements of this Section (b);
(c) SEC and Other Reports -- promptly upon their becoming
available, one copy of (i) each financial statement, report
(including, without limitation, the Company's annual report to
shareholders, if any, prepared pursuant to Rule 14a-3 under the
Exchange Act), notice or proxy statement sent by the Company or
any Subsidiary to public securities holders generally, and (ii)
each regular or periodic report, each registration statement
(without exhibits except as expressly requested by such holder),
and each prospectus and all amendments thereto filed by the
Company or any Subsidiary with the Securities and Exchange
Commission and of all press releases and other statements made
available generally by the Company or any Subsidiary to the public
concerning developments that are Material;
(d) Notice of Default or Event of Default -- promptly, and
in any event within five days after a Responsible Officer becoming
aware of the existence of any Default or Event of Default or that
13
any Person has given any notice or taken any action with respect
to a claimed default hereunder or that any Person has given any
notice or taken any action with respect to a claimed default of
the type referred to in Section 11(f), a written notice specifying
the nature and period of existence thereof and what action the
Company is taking or proposes to take with respect thereto;
(e) ERISA Matters -- promptly, and in any event within five
days after a Responsible Officer becoming aware of any of the
following, a written notice setting forth the nature thereof and
the action, if any, that the Company or an ERISA Affiliate
proposes to take with respect thereto:
(i) with respect to any Plan, any reportable event, as
defined in section 4043 of ERISA and the regulations
thereunder, for which notice thereof has not been waived
pursuant to such regulations as in effect on the date of the
Closing; or
(ii) the taking by the PBGC of steps to institute, or
the threatening by the PBGC of the institution of,
proceedings under section 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, any Plan,
or the receipt by the Company or any ERISA Affiliate of a
notice from a Multiemployer Plan that such action has been
taken by the PBGC with respect to such Multiemployer Plan; or
(iii) any event, transaction or condition that could
result in the incurrence of any liability by the Company or
any ERISA Affiliate pursuant to Title I or IV of ERISA or the
penalty or excise tax provisions of the Code relating to
employee benefit plans, or in the imposition of any Lien on
any of the rights, properties or assets of the Company or any
ERISA Affiliate pursuant to Title I or IV of ERISA or such
penalty or excise tax provisions, if such liability or Lien,
taken together with any other such liabilities or Liens then
existing, could reasonably be expected to have a Material
Adverse Effect;
(f) Notices from Governmental Authority -- promptly, and in
any event within 30 days of receipt thereof, copies of any notice
to the Company or any Subsidiary from any Federal or state
Governmental Authority relating to any order, ruling, statute or
other law or regulation that could reasonably be expected to have
a Material Adverse Effect; and
(g) Actions, Proceedings -- promptly after a Responsible
Officer becomes aware of the commencement thereof, notice of any
action or proceeding relating to the Company or any Subsidiary in
any court or before any Governmental Authority or arbitration
board or tribunal which would be required to be disclosed in a
report on Form 10-Q or Form 10-K filed by the Company with the SEC
(whether or not the Company remains subject to the jurisdiction of
the SEC in the same manner as exists on the date of Closing); and
(h) Requested Information -- with reasonable promptness,
such other data and information relating to the business,
operations, affairs, financial condition, assets or properties of
the Company or any of its Subsidiaries or relating to the ability
of the Company to perform its obligations hereunder and under the
Notes as from time to time may be reasonably requested by any such
holder of Notes, or such information regarding the Company
required to satisfy the requirements of 17 C.F.R. 230.144A, as
amended from time to time, in connection with any contemplated
transfer of the Notes.
14
7.2. Officer's Certificate.
Each set of financial statements delivered to a holder of Notes
pursuant to Section (a) or Section (b) hereof shall be accompanied by a
certificate of a Senior Financial Officer setting forth:
(a) Covenant Compliance -- the information (including
detailed calculations) required in order to establish whether the
Company was in compliance with the requirements of Sections 10.2
through 10.7, inclusive, during the quarterly or annual period
covered by the statements then being furnished (including with
respect to each such Section, where applicable, the calculations
of the maximum or minimum amount, ratio or percentage, as the case
may be, permissible under the terms of such Sections, and the
calculation of the amount, ratio or percentage then in existence);
and
(b) Event of Default -- a statement that such officer has
reviewed the relevant terms hereof and has made, or caused to be
made, under his or her supervision, a review of the transactions
and conditions of the Company and its Subsidiaries from the
beginning of the quarterly or annual period covered by the
statements then being furnished to the date of the certificate and
that such review has not disclosed the existence during such
period of any condition or event that constitutes a Default or an
Event of Default or, if any such condition or event existed or
exists (including, without limitation, any such event or condition
resulting from the failure of the Company or any Subsidiary to
comply with any Environmental Law), specifying the nature and
period of existence thereof and what action the Company shall have
taken or proposes to take with respect thereto.
7.3. Inspection.
The Company shall permit the representatives of each holder of
Notes that is an Institutional Investor:
(a) No Default -- if no Default or Event of Default then
exists, at the expense of such holder and upon reasonable prior
notice to the Company, to visit the principal executive office of
the Company, to discuss the affairs, finances and accounts of the
Company and its Subsidiaries with the Company's officers, and
(with the consent of the Company, which consent will not be
unreasonably withheld) its independent public accountants, and
(with the consent of the Company, which consent will not be
unreasonably withheld) to visit the other offices and properties
of the Company and each Subsidiary, all at such reasonable times
and as often as may be reasonably requested in writing; and
(b) Default -- if a Default or Event of Default then exists,
at the expense of the Company, to visit and inspect any of the
offices or properties of the Company or any Subsidiary, to examine
all their respective books of account, records, reports and other
papers, to make copies and extracts therefrom, and to discuss
their respective affairs, finances and accounts with their
respective officers and independent public accountants (and by
this provision the Company authorizes said accountants to discuss
the affairs, finances and accounts of the Company and its
Subsidiaries), all at such times and as often as may be requested.
15
8. PAYMENT OF THE NOTES.
8.1. Required Prepayments; Payment at Maturity.
On December 31, 1999 and on each December 31 thereafter to and
including December 31, 2002, the Company will prepay $7,000,000
principal amount (or such lesser principal amount as shall then be
outstanding) of the Notes at par and without payment of the Make-Whole
Amount or any premium, and the Company will pay all of the principal
amount of the Notes remaining outstanding, if any, on December 31,
2003. Each partial prepayment of the Notes pursuant to Section 8.2
will reduce the principal amount of each mandatory prepayment
applicable to the Notes, as set forth in this Section 8.1, and the
payment at maturity of the Notes in the same proportion as the
aggregate unpaid principal amount of the Notes is reduced as a result
of such prepayment.
8.2. Optional Prepayments with Make-Whole Amount.
The Company may, at its option, upon notice as provided below,
prepay at any time all, or from time to time any part of, the Notes,
(but if in part, in an amount not less than $500,000 or such lesser
amount as shall then be outstanding), at 100% of the principal amount
so prepaid, plus the Make-Whole Amount determined for the prepayment
date with respect to such principal amount. The Company will give each
holder of Notes written notice of each optional prepayment under this
Section 8.2 not less than 30 days and not more than 60 days prior to
the date fixed for such prepayment. Each such notice shall specify
such prepayment date, the aggregate principal amount of the Notes to be
prepaid on such date, the principal amount of each Note held by such
holder to be prepaid (determined in accordance with Section 8.3), and
the interest to be paid on the prepayment date with respect to such
principal amount being prepaid, and shall be accompanied by a
certificate of a Senior Financial Officer as to the estimated Make-
Whole Amount due in connection with such prepayment (calculated as if
the date of such notice were the date of the prepayment), setting forth
the details of such computation. Two Business Days prior to such
prepayment, the Company shall deliver to each holder of Notes a
certificate of a Senior Financial Officer specifying the calculation of
such Make-Whole Amount as of the specified prepayment date.
8.3. Allocation of Partial Prepayments.
In the case of each partial prepayment of the Notes, the principal
amount of the Notes to be prepaid shall be allocated among all of the
Notes at the time outstanding in proportion, as nearly as practicable,
to the respective unpaid principal amounts thereof not theretofore
called for prepayment.
8.4. Maturity; Surrender, etc.
In the case of each prepayment of Notes pursuant to this Section
8, the principal amount of each Note to be prepaid shall mature and
become due and payable on the date fixed for such prepayment, together
with interest on such principal amount accrued to such date and the
applicable Make-Whole Amount, if any. From and after such date, unless
the Company shall fail to pay such principal amount when so due and
payable, together with the interest and Make-Whole Amount, if any, as
aforesaid, interest on such principal amount shall cease to accrue.
Any Note paid or prepaid in full shall be surrendered to the Company
and cancelled and shall not be reissued, and no Note shall be issued in
lieu of any prepaid principal amount of any Note.
16
8.5. No Other Optional Prepayments or Purchase of Notes.
The Company will not prepay (whether directly or indirectly by
purchase, redemption or other acquisition) any of the outstanding Notes
except upon the payment or prepayment of the Notes in accordance with
the terms of this Section 8. The Company will promptly cancel all
Notes acquired by it or any Subsidiary pursuant to any payment,
prepayment or purchase of Notes pursuant to any provision of this
Section 8 and no Notes may be issued in substitution or exchange for
any such Notes.
8.6. Make-Whole Amount.
The term "Make-Whole Amount" means, with respect to any Note, an
amount equal to the excess, if any, of the Discounted Value of the
Remaining Scheduled Payments with respect to the Called Principal of
such Note over the amount of such Called Principal, provided that the
Make-Whole Amount may in no event be less than zero. For the purposes
of determining the Make-Whole Amount, the following terms have the
following meanings:
"Called Principal" means, with respect to any Note, the
principal of such Note that is to be prepaid pursuant to Section
8.2 or has become or is declared to be immediately due and payable
pursuant to Section 12.1, as the context requires.
"Discounted Value" means, with respect to the Called
Principal of any Note, the amount obtained by discounting all
Remaining Scheduled Payments with respect to such Called Principal
from their respective scheduled due dates to the Settlement Date
with respect to such Called Principal, in accordance with accepted
financial practice and at a discount factor (applied on the same
periodic basis as that on which interest on the Notes is payable)
equal to the Reinvestment Yield with respect to such Called
Principal.
"Reinvestment Yield" means, with respect to the Called
Principal of any Note, 0.50% over the yield to maturity implied by
(a) the yields reported, as of 10:00 A.M. (New York City time) on
the second Business Day preceding the Settlement Date with respect
to such Called Principal, on the display designated as "Page 678"
on the Telerate Access Service (or such other display as may
replace Page 678 on Telerate Access Service) for actively traded
U.S. Treasury securities having a maturity equal to the Remaining
Average Life of such Called Principal as of such Settlement Date,
or (b) if such yields are not reported as of such time or the
yields reported as of such time are not ascertainable, the
Treasury Constant Maturity Series Yields reported, for the latest
day for which such yields have been so reported as of the second
Business Day preceding the Settlement Date with respect to such
Called Principal, in Federal Reserve Statistical Release H.15
(519) (or any comparable successor publication) for actively
traded U.S. Treasury securities having a constant maturity equal
to the Remaining Average Life of such Called Principal as of such
Settlement Date. Such implied yield will be determined, if
necessary, by (i) converting U.S. Treasury xxxx quotations to bond-
equivalent yields in accordance with accepted financial practice
and (ii) interpolating linearly between (1) the actively traded
U.S. Treasury security with the duration closest to and greater
than the Remaining Average Life and (2) the actively traded U.S.
Treasury security with the duration closest to and less than the
Remaining Average Life.
"Remaining Average Life" means, with respect to any Called
Principal, the number of years (calculated to the nearest one
twelfth year) obtained by dividing (a) such Called Principal into
(b) the sum of the products obtained by multiplying (i) the
principal component of each Remaining Scheduled Payment with
respect to such Called Principal by (ii) the number of years
(calculated to the nearest one-twelfth year) that will elapse
between the Settlement Date with respect to such Called Principal
and the scheduled due date of such Remaining Scheduled Payment.
"Remaining Scheduled Payments" means, with respect to the
Called Principal of any Note, all payments of such Called
Principal and interest thereon that would be due after the
Settlement Date with respect to such Called Principal if no
payment of such Called Principal were made prior to its scheduled
due date, provided that if such Settlement Date is not a date on
which interest payments are due to be made under the terms of the
Notes, then the amount of the next succeeding scheduled interest
payment will be reduced by the amount of interest accrued to such
Settlement Date and required to be paid on such Settlement Date
pursuant to Section 8.2 or 12.1.
"Settlement Date" means, with respect to the Called Principal
of any Note, the date on which such Called Principal is to be
prepaid pursuant to Section 8.2 or has become or is declared to be
immediately due and payable pursuant to Section 12.1, as the
context requires.
9. AFFIRMATIVE COVENANTS.
The Company covenants that so long as any of the Notes are
outstanding:
9.1. Compliance with Law.
The Company will and will cause each of its Subsidiaries to comply
with all laws, ordinances or governmental rules or regulations to which
each of them is subject, including, without limitation, Environmental
Laws, and will obtain and maintain in effect all licenses,
certificates, permits, franchises and other governmental authorizations
necessary to the ownership of their respective properties or to the
conduct of their respective businesses, in each case to the extent
necessary to ensure that non-compliance with such laws, ordinances or
governmental rules or regulations or failures to obtain or maintain in
effect such licenses, certificates, permits, franchises and other
governmental authorizations could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
9.2. Insurance.
The Company will and will cause each of its Subsidiaries to
maintain, with financially sound and reputable insurers, insurance with
respect to their respective properties and businesses against such
casualties and contingencies, of such types, on such terms and in such
amounts (including deductibles, co-insurance and selfinsurance, if
adequate reserves are maintained with respect thereto) as is customary
in the case of entities of established reputations engaged in the same
or a similar business and similarly situated.
9.3. Maintenance of Properties.
The Company will and will cause each of its Subsidiaries to maintain
and keep, or cause to be maintained and kept, their respective
properties in good repair, working order and condition (other than
ordinary wear and tear), so that the business carried on in connection
therewith may be properly conducted at all times, provided that this
Section shall not prevent the Company or any Subsidiary from
discontinuing the operation and the maintenance of any of its
properties if such discontinuance is desirable in the conduct of its
business and the Company has concluded that such discontinuance could
not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
18
9.4. Payment of Taxes and Claims.
The Company will and will cause each of its Subsidiaries to file
all tax returns required to be filed in any jurisdiction and to pay and
discharge all taxes shown to be due and payable on such returns and all
other taxes, assessments, governmental charges, or levies imposed on
them or any of their properties, assets, income or franchises, to the
extent such taxes, assessments, charges or levies have become due and
payable and before they have become delinquent and all claims for which
sums have become due and payable that have or might become a Lien on
properties or assets of the Company or any Subsidiary, provided that
neither the Company nor any Subsidiary need pay any such tax or
assessment or claims if (a) the amount, applicability or validity
thereof is contested by the Company or such Subsidiary on a timely
basis in good faith and in appropriate proceedings, and the Company or
a Subsidiary has established adequate reserves therefor in accordance
with GAAP on the books of the Company or such Subsidiary or (b) the
nonpayment of all such taxes, assessments, charges and levies in the
aggregate could not reasonably be expected to have a Material Adverse
Effect.
9.5. Corporate Existence, etc.
The Company will at all times preserve and keep in full force and
effect its corporate existence. Subject to Section 10.10, the Company
will at all times preserve and keep in full force and effect the
corporate existence of each of its Subsidiaries (unless merged into the
Company or a Subsidiary) and all rights and franchises of the Company
and its Subsidiaries unless, in the good faith judgment of the Company,
the termination of or failure to preserve and keep in full force and
effect such corporate existence, right or franchise could not,
individually or in the aggregate, have a Material Adverse Effect.
10. NEGATIVE COVENANTS.
The Company covenants that so long as any of the Notes are
outstanding:
10.1. Transactions with Affiliates.
The Company will not, and will not permit any Subsidiary to, enter
into directly or indirectly any transaction or group of related
transactions (including, without limitation, the purchase, lease, sale
or exchange of properties of any kind or the rendering of any service)
with any Affiliate (other than the Company or another Subsidiary),
except in the ordinary course and pursuant to the reasonable
requirements of the Company's or such Subsidiary's business and upon
fair and reasonable terms no less favorable to the Company or such
Subsidiary than would be obtainable in a comparable arm's-length
transaction with a Person not an Affiliate.
10.2. Consolidated Net Worth.
The Company will not, at any time, permit Consolidated Net Worth
to be less than the sum of
(a) $65,000,000, plus
(b) an aggregate amount equal to 35% of Consolidated Net
Income (or, in the case of a loss, zero) for each completed fiscal
quarter of the Company beginning with the fiscal quarter of the
Company ended March 31, 1997.
10.3. Maintenance of Consolidated Senior Funded Debt.
19
(a) The Company will not at any time permit Consolidated
Senior Funded Debt (excluding Defeased GECC Debt) at such time to
exceed 90% of Consolidated Net Worth as of the then most recently
ended fiscal quarter of the Company.
(b) The Company will repay, or cause to be repaid, each item
of Debt specified in paragraph (a) of Schedule 5.14 on or before
the date specified therein for the repayment of such Debt.
10.4. Maintenance of Consolidated Subsidiary Debt.
The Company will not at any time permit Consolidated Subsidiary
Debt (excluding Defeased GECC Debt) at such time to exceed 20% of
Consolidated Net Worth as of the then most recently ended fiscal
quarter of the Company
10.5. Maintenance of Consolidated Funded Debt.
The Company will not at any time permit Consolidated Funded Debt
(excluding Defeased GECC Debt) at such time to exceed 135% of
Consolidated Net Worth as of the then most recently ended fiscal
quarter of the Company.
10.6. Liens.
The Company will not, and will not permit any of its Subsidiaries
to, directly or indirectly create, incur, assume or permit to exist
(upon the happening of a contingency or otherwise) any Lien on or with
respect to any property or asset (including, without limitation, any
document or instrument in respect of goods or accounts receivable) of
the Company or any such Subsidiary, whether now owned or held or
hereafter acquired, or any income or profits therefrom (whether or not
provision is made for the equal and ratable securing of the Notes in
accordance with the last paragraph of this Section 10.6), or assign or
otherwise convey any right to receive income or profits, except:
(a) Liens for taxes, assessments or other governmental
charges the payment of which is not at the time required by
Section 9.4;
(b) Liens (other than any Lien imposed by ERISA) incurred or
deposits made in the ordinary course of business (i) in connection
with workers' compensation, unemployment insurance and other types
of social security or retirement benefits, or (ii) to secure (or
to obtain letters of credit that secure) the performance of
tenders, statutory obligations, surety bonds, appeal bonds, bids,
leases (other than Capital Leases), performance bonds, purchase,
construction or sales contracts and other similar obligations, in
each case not incurred or made in connection with the borrowing of
money, the obtaining of advances or credit or the payment of the
deferred purchase price of property;
(c) any attachment or judgment Lien, unless the judgment it
secures (i) shall not, within 30 days after the entry thereof,
have been discharged or execution thereof stayed pending appeal,
or shall not have been discharged within 30 days after the
expiration of any such stay or (ii) exceeds $5,000,000;
20
(d) Liens on property or assets of the Company or any of its
Subsidiaries securing Debt owing to the Company or to any of its
Wholly-Owned Subsidiaries;
(e) Liens existing on the date of this Agreement (including,
without limitation, Liens securing Defeased GECC Debt) and
securing the Debt of the Company and its Subsidiaries described in
Schedule 5.15 and any Lien renewing, extending or refunding any
Lien permitted by this clause (e), provided that (i) the principal
amount of Debt secured by such Lien immediately prior to such
extension, renewal or refunding is not increased or the maturity
thereof reduced, (ii) such Lien is not extended to any other
property, and (iii) immediately prior to and after such extension,
renewal or refunding no Default or Event of Default would exist;
(f) Liens arising in connection with deposits made with
exchanges, depositories, or clearing corporations in the ordinary
course of the broker-dealer business and Liens arising in
connection with loans and each other transaction in the ordinary
course of the broker-dealer or banking business of any of the
Subsidiaries, including, but not limited to, repurchase agreements
and customer security transactions;
(g) leases or subleases granted to others, easements, rights-
of-way, restrictions and other similar charges or encumbrances, in
each case incidental to, and not interfering with, the ordinary
conduct of the business of the Company or any of its Subsidiaries,
provided that such Liens do not, in the aggregate, materially
detract from the value of such property or its usefulness to the
Company or its Subsidiaries, as the case may be;
(h) Liens arising in the ordinary course of business in
connection with the acquisition of personal property in the
ordinary course of business of the Company or any of its
Subsidiaries so long as the aggregate amount of the obligations or
Debt secured by such Liens does not at any time exceed $1,000,000
and such Lien is granted contemporaneously with the acquisition of
such personal property; and
(i)other Liens not otherwise permitted by paragraphs (a)
through (h), inclusive, of this Section 10.6, which Liens secure
Debt and are granted contemporaneously with the incurrence of such
Debt, provided (i) that the incurrence of such Debt is permitted
by Section 10.2 through 10.5, inclusive, and (ii) the Company
shall make, or cause to be made, effective provisions whereby the
Notes will be secured equally and ratably with such Debt pursuant
to agreements reasonably satisfactory to the Required Holders.
If, notwithstanding the prohibition contained herein, the Company
shall create, assume or permit to exist any Lien upon any of its
property or assets, or the property or assets of any of its
Subsidiaries, whether now owned or hereafter acquired, other than those
permitted by the provisions of paragraphs (a) through (h) of this
Section 10.6, it will make or cause to be made effective provision
whereby the Notes will be secured equally and ratably with any and all
other obligations thereby secured, such security to be pursuant to
agreements reasonably satisfactory to the Required Holders and, in any
such case, the Notes shall have the benefit, to the fullest extent
that, and with such priority as, the holders of the Notes may be
entitled under applicable law, of an equitable Lien on such property.
Such violation of this Section 10.6 will constitute an Event of
Default, whether or not provision is made for an equal and ratable Lien
pursuant to this Section 10.6.
10.7. Required Net Capital.
21
The Company will not permit, at any time,
(a) the NYSE Net Capital of any Broker-Dealer Subsidiary to
be less than 100% of NYSE Required Net Capital, and
(b) the SEC Net Capital of any Broker-Dealer Subsidiary to
be less than 150% of the SEC Required Net Capital,
in each case determined at such time.
10.8. Line of Business.
The Company will not, and will not permit any of its Subsidiaries
to, engage to any substantial extent, in any business if after giving
effect thereto the assets of all businesses of the Company and its
Subsidiaries (other than assets utilized in, and attributable to, the
broker-dealer business of the Broker Dealer Subsidiary and other
Subsidiaries engaging in businesses reasonably related to the broker-
dealer business) exceed the greater of (a) $300,000,000 or (b) 35% of
consolidated assets of the Company and its Subsidiaries.
10.9. Maintenance of Ownership.
The Company shall at all times own, both legally and beneficially,
not less than 80% of the outstanding Voting Interests of Advest.
10.10. Merger, Consolidation, etc.
The Company will not, and will not permit any of its Subsidiaries
to, consolidate with or merge with any other corporation or convey,
transfer or lease substantially all of its assets in a single
transaction or series of transactions to any Person (except that a
Subsidiary of the Company may consolidate with or merge with, or
convey, transfer or lease substantially all of its assets in a single
transaction or series of transactions to, another Wholly-Owned
Subsidiary, the Company or any other Person so long as after giving
effect to such transaction (1) such other Person would be a Wholly-
Owned Subsidiary and (2) no Default or Event of Default would exist),
provided that the foregoing restriction does not apply to the
consolidation or merger of the Company with, or the conveyance,
transfer or lease of substantially all of the assets of the Company in
a single transaction or series of transactions to, any Person so long
as:
(a) the successor formed by such consolidation or the
survivor of such merger or the Person that acquires by conveyance,
transfer or lease substantially all of the assets of the Company
as an entirety, as the case may be (the "Successor Corporation"),
shall be a solvent corporation organized and existing under the
laws of the United States of America, any State thereof or the
District of Columbia;
(b) if the Company is not the Successor Corporation, such
corporation shall have executed and delivered to each holder of
Notes its assumption of the due and punctual performance and
observance of each covenant and condition of this Agreement and
the Notes; and
(c) immediately after giving effect to such transaction:
(i) no Default or Event of Default would exist, and
22
(ii) the Successor Corporation would be permitted by the
provisions of Section 10.5 to incur at least $1.00 of
additional Funded Debt owing to a Person other than a
Subsidiary of the Successor Corporation.
No such conveyance, transfer or lease of substantially all of the
assets of the Company shall have the effect of releasing the Company or
any Successor Corporation from its liability under this Agreement or
the Notes.
10.11. Guaranties.
The Company will not, and will not permit any of its Subsidiaries
to, enter into any Guaranty unless such Guaranty is entered into in the
ordinary course of the Company's or such Subsidiary's business or at
the time such Guaranty is entered into, the Company or such Subsidiary
would be permitted to incur the entire principal amount of the Debt or
other obligation being guaranteed by the Company or such Subsidiary
pursuant to the provisions of Sections 10.2 through 10.5, inclusive.
11. EVENTS OF DEFAULT.
An "Event of Default" shall exist if any of the following
conditions or events shall occur and be continuing:
(a) the Company defaults in the payment of any principal or
Make-Whole Amount, if any, on any Note when the same becomes due
and payable, whether at maturity or at a date fixed for prepayment
or by declaration or otherwise; or
(b) the Company defaults in the payment of any interest on
any Note for more than 5 Business Days after the same becomes due
and payable; or
(c) the Company defaults in the performance of or compliance
with any term contained in any of Sections 10.2 through 10.11,
inclusive, or Section 7.1(d); or
(d) the Company defaults in the performance of or compliance
with any term contained herein (other than those referred to in
paragraphs (a), (b) and (c) of this Section 11) and such default
is not remedied within 30 days after the earlier of (i) a
Responsible Officer obtaining actual knowledge of such default and
(ii) the Company receiving written notice of such default from any
holder of a Note (any such written notice to be identified as a
"notice of default" and to refer specifically to this paragraph
(d) of Section 11; or
(e) any representation or warranty made in writing by or on
behalf of the Company or by any officer of the Company in this
Agreement or in any writing furnished in connection with the
transactions contemplated hereby proves to have been false or
incorrect in any material respect on the date as of which made; or
(f) (i) the Company or any Subsidiary is in default (as
principal or as guarantor or other surety) in the payment of
any principal of or premium or make-whole amount or interest
on any Debt (other than Debt under this Agreement and the
Notes) beyond any period of grace provided with respect
thereto, that individually or together with such other Debt
as to which any such default exists has an aggregate
outstanding principal amount of at least $5,000,000, or
23
(ii) the Company or any Subsidiary is in default in the
performance of or compliance with any other term of any
evidence of any Debt (other than Debt under this Agreement
and the Notes), that individually or together with such other
Debt as to which any such default exists has an aggregate
outstanding principal amount of at least $5,000,000, or of
any mortgage, indenture or other agreement relating thereto
or any other condition exists, and as a consequence of such
default or condition such Debt has become, or has been
declared (or one or more Persons are entitled to declare such
Debt to be), due and payable before its stated maturity or
before its regularly scheduled dates of payment, or
(iii) as a consequence of the occurrence or continuation
of any event or condition (other than the passage of time or
the right of the holder of Debt to convert such Debt into
equity interests),
(A) the Company or any Subsidiary has become
obligated to purchase or repay Debt before its regular
maturity or before its regularly scheduled dates of
payment in an aggregate outstanding principal amount of at
least $5,000,000, or
(B) one or more Persons have the right to require
the Company or any Subsidiary so to purchase or repay such
Debt; or
(g) the Company or any Subsidiary (i) is generally not
paying, or admits in writing its inability to pay, its debts as
they become due, (ii) files, or consents by answer or otherwise to
the filing against it of, a petition for relief or reorganization
or arrangement or any other petition in bankruptcy, for
liquidation or to take advantage of any bankruptcy, insolvency,
reorganization, moratorium or other similar law of any
jurisdiction, (iii) makes an assignment for the benefit of its
creditors, (iv) consents to the appointment of a custodian,
receiver, trustee or other officer with similar powers with
respect to it or with respect to any substantial part of its
property, (v) is adjudicated as insolvent or to be liquidated, or
(vi) takes corporate action for the purpose of any of the
foregoing; or
(h) a court or governmental authority of competent
jurisdiction enters an order appointing, without consent by the
Company or any Subsidiary, a custodian, receiver, trustee or other
officer with similar powers with respect to the Company or any
Subsidiary or with respect to any substantial part of the property
of the Company or any Subsidiary, or constituting an order for
relief or approving a petition for relief or reorganization or any
other petition in bankruptcy or for liquidation or to take
advantage of any bankruptcy or insolvency law of any jurisdiction,
or ordering the dissolution, winding-up or liquidation of the
Company or any Subsidiary, or any such petition shall be filed
against the Company or any Subsidiary and such petition shall not
be dismissed within 60 days; or
(i) a final judgment or judgments for the payment of money
aggregating in excess of $1,000,000 are rendered against one or
more of the Company and its Subsidiaries and which judgments are
not, within 60 days after entry thereof, not required to be paid
during the pursuit of a good faith appeal, or are not discharged
within 60 days after the expiration of the first date such
judgment is required to be paid; or
(j) any Broker-Dealer Subsidiary shall cease to be a member
organization of the NYSE (other than in connection with a
voluntary termination of such membership) or the NASD; the NASD
shall suspend, and not reinstate within ten (10) days, any Broker-
Dealer Subsidiary, or revoke its membership as a member firm in
the NASD; or the SEC, the NYSE or the NASD shall make a decision,
24
enter an order, or take other action directed specifically at any
Broker-Dealer Subsidiary which could reasonably be expected to
have a Material Adverse Effect and which is not directed at the
broker-dealer industry generally, and such decision, order or
action shall continue unstayed and in effect for a period of
thirty (30) days; or
(k) any Broker-Dealer Subsidiary shall fail to file any
report or information required pursuant to SIPA or to pay when due
all or any part of an assessment made upon it pursuant to SIPA,
and such failure shall not have been cured within ten (10) days
after receipt by it of notice of such failure given by or on
behalf of SIPC; or
(l) the making of an application by SIPC for a decree
adjudicating that customers of any Broker-Dealer Subsidiary are in
need of protection under SIPA and the failure of such Broker-
Dealer Subsidiary to obtain the dismissal of such application
within thirty (30) days; or
(m) if (i) any Plan shall fail to satisfy the minimum
funding standards of ERISA or the Code for any plan year or
part thereof or a waiver of such standards or extension of
any amortization period is sought or granted under section
412 of the Code,
(ii) a notice of intent to terminate any Plan shall have
been or is reasonably expected to be filed with the PBGC or
the PBGC shall have instituted proceedings under ERISA
section 4042 to terminate or appoint a trustee to administer
any Plan or the PBGC shall have notified the Company or any
ERISA Affiliate that a Plan may become a subject of any such
proceedings,
(iii) the aggregate "amount of unfunded benefit
liabilities" (within the meaning of section 4001(a)(18) of
ERISA) under all Plans subject to Title IV of ERISA,
determined in accordance with Title IV of ERISA, shall exceed
$5,000,000,
(iv) the Company or any ERISA Affiliate shall have
incurred or is reasonably expected to incur any liability
pursuant to Title I or IV of ERISA or the penalty or excise
tax provisions of the Code relating to employee benefit
plans,
(v) the Company or any ERISA Affiliate withdraws from
any Multiemployer Plan, or
(iv) the Company or any Subsidiary establishes or amends
any employee welfare benefit plan that provides post-
employment welfare benefits in a manner that would increase
the liability of the Company or any Subsidiary thereunder;
and any such event or events described in clauses (i) through (vi)
above, either individually or together with any other such event
or events, could reasonably be expected to have a Material Adverse
Effect.
As used in Section 11(m), the terms "employee benefit plan" and
"employee welfare benefit plan" shall have the respective meanings
assigned to such terms in section 3 of ERISA.
25
12. REMEDIES ON DEFAULT, ETC.
12.1. Acceleration.
(a) If an Event of Default with respect to the Company
described in paragraph (g) or paragraph (h) of Section 11 (other
than an Event of Default described in clause (i) of paragraph (g)
or described in clause (vi) of paragraph (g) by virtue of the fact
that such clause encompasses clause (i) of paragraph (g)) has
occurred, all the Notes then outstanding shall automatically
become immediately due and payable.
(b) If any other Event of Default has occurred and is
continuing, any holder or holders of more than 51% in principal
amount of the Notes at the time outstanding may at any time at its
or their option, by notice or notices to the Company, declare all
the Notes then outstanding to be immediately due and payable.
(c) If any Event of Default described in paragraph (a) or
(b) of Section 11 has occurred and is continuing, any holder or
holders of Notes at the time outstanding affected by such Event of
Default may at any time, at its or their option, by notice or
notices to the Company, declare all the Notes held by it or them
to be immediately due and payable.
Upon any Notes becoming due and payable under this Section 12.1,
whether automatically or by declaration, such Notes will forthwith
mature and the entire unpaid principal amount of such Notes, plus (x)
all accrued and unpaid interest thereon and (y) the Make-Whole Amount
determined in respect of such principal amount (to the full extent
permitted by applicable law), shall all be immediately due and payable,
in each and every case without presentment, demand, protest or further
notice, all of which are hereby waived. The Company acknowledges, and
the parties hereto agree, that each holder of a Note has the right to
maintain its investment in the Notes free from repayment by the Company
(except as herein specifically provided for) and that the provision for
payment of a Make-Whole Amount by the Company in the event that the
Notes are prepaid or are accelerated as a result of an Event of
Default, is intended to provide compensation for the deprivation of
such right under such circumstances.
12.2. Other Remedies.
If any Default or Event of Default has occurred and is continuing,
and irrespective of whether any Notes have become or have been declared
immediately due and payable under Section 12.1, the holder of any Note
at the time outstanding may proceed to protect and enforce the rights
of such holder by an action at law, suit in equity or other appropriate
proceeding, whether for the specific performance of any agreement
contained herein or in any Note, or for an injunction against a
violation of any of the terms hereof or thereof, or in aid of the
exercise of any power granted hereby or thereby or by law or otherwise.
12.3. Rescission.
At any time after any Notes have been declared due and payable
pursuant to clause (b) or clause (c) of Section 12.1, the holders of
not less than 51% in principal amount of the Notes then outstanding, by
written notice to the Company, may rescind and annul any such
declaration and its consequences if (a) the Company has paid all
overdue interest on the Notes, all principal of and Make-Whole Amount,
if any, due and payable on any Notes other than by reason of such
declaration, and all interest on such overdue principal and Make-Whole
Amount, if any, and (to the extent permitted by applicable law) any
overdue interest in respect of the Notes, at
26
the Default Rate, (b) all Events of Default and Defaults, other than
non-payment of amounts that have become due solely by reason of such
declaration, have been cured or have been waived pursuant to Section
17, and (c) no judgment or decree has been entered for the payment of
any monies due pursuant hereto or to the Notes. No rescission and
annulment under this Section 12.3 will extend to or affect any
subsequent Event of Default or Default or impair any right consequent
thereon.
12.4. No Waivers or Election of Remedies, Expenses, etc.
No course of dealing and no delay on the part of any holder of any
Note in exercising any right, power or remedy shall operate as a waiver
thereof or otherwise prejudice such holder's rights, powers or
remedies. No right, power or remedy conferred by this Agreement or by
any Note upon any holder thereof shall be exclusive of any other right,
power or remedy referred to herein or therein or now or hereafter
available at law, in equity, by statute or otherwise. Without limiting
the obligations of the Company under Section 15, the Company will pay
to the holder of each Note on demand such further amount as shall be
sufficient to cover all costs and expenses of such holder incurred in
any enforcement or collection under this Section 12, including, without
limitation, reasonable attorneys' fees, expenses and disbursements.
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.
13.1. Registration of Notes.
The Company shall keep at its principal executive office a
register for the registration and registration of transfers of Notes.
The name and address of each holder of one or more Notes, each transfer
thereof and the name and address of each transferee of one or more
Notes shall be registered in such register. Prior to due presentment
for registration of transfer, the Person in whose name any Note shall
be registered shall be deemed and treated as the owner and holder
thereof for all purposes hereof, and the Company shall not be affected
by any notice or knowledge to the contrary. The Company shall give to
any holder of a Note that is an Institutional Investor promptly upon
request therefor, a complete and correct copy of the names and
addresses of all registered holders of Notes.
13.2. Transfer and Exchange of Notes.
Upon surrender of any Note at the principal executive office of
the Company for registration of transfer or exchange (and in the case
of a surrender for registration of transfer, duly endorsed or
accompanied by a written instrument of transfer duly executed by the
registered holder of such Note or his attorney duly authorized in
writing and accompanied by the address for notices of each transferee
of such Note or part thereof), the Company shall execute and deliver,
at the Company's expense (except as provided below), one or more new
Notes (as requested by the holder thereof) in exchange therefor, in an
aggregate principal amount equal to the unpaid principal amount of the
surrendered Note. Each such new Note shall be payable to such Person
as such holder may request and shall be substantially in the form of
Exhibit 1. Each such new Note shall be dated and bear interest from
the date to which interest shall have been paid on the surrendered Note
or dated the date of the surrendered Note if no interest shall have
been paid thereon. The Company may require payment of a sum sufficient
to cover any stamp tax or governmental charge imposed in respect of any
such transfer of Notes. Notes shall not be transferred in
denominations of less than $500,000, provided that if necessary to
enable the registration of transfer by a holder of its entire holding
of Notes, one Note may be in a denomination of less than $500,000. Any
transferee, by its acceptance of a Note registered in its name (or the
name of its nominee), shall be deemed to have made the representation
set forth in Section 6.2.
27
13.3. Replacement of Notes.
Upon receipt by the Company of evidence reasonably satisfactory to
it of the ownership of and the loss, theft, destruction or mutilation
of any Note (which evidence shall be, in the case of an Institutional
Investor, notice from such Institutional Investor of such ownership and
such loss, theft, destruction or mutilation), and
(a) in the case of loss, theft or destruction, of indemnity
reasonably satisfactory to it (provided that if the holder of such
Note is, or is a nominee for, an original purchaser or a Qualified
Institutional Buyer, such Person's own unsecured agreement of
indemnity shall be deemed to be satisfactory), or
(b) in the case of mutilation, upon surrender and
cancellation thereof,
the Company at its own expense shall execute and deliver, in lieu
thereof, a new Note, dated and bearing interest from the date to which
interest shall have been paid on such lost, stolen, destroyed or
mutilated Note or dated the date of such lost, stolen, destroyed or
mutilated Note if no interest shall have been paid thereon.
14. PAYMENTS ON NOTES.
14.1. Place of Payment.
Subject to Section 14.2, payments of principal, Make-Whole Amount,
if any, and interest becoming due and payable on the Notes shall be
made in Hartford, Connecticut at the principal office of the Company in
such jurisdiction. The Company may at any time, by notice to each
holder of a Note, change the place of payment of the Notes so long as
such place of payment shall be either the principal office of the
Company in such jurisdiction or the principal office of a bank or trust
company in such jurisdiction.
14.2. Home Office Payment.
So long as you or your nominee shall be the holder of any Note,
and notwithstanding anything contained in Section 14.1 or in such Note
to the contrary, the Company will pay all sums becoming due on such
Note for principal, Make-Whole Amount, if any, and interest by the
method and at the address specified for such purpose below your name in
Schedule A, or by such other method or at such other address as you
shall have from time to time specified to the Company in writing for
such purpose, without the presentation or surrender of such Note or the
making of any notation thereon, except that upon written request of the
Company made concurrently with or reasonably promptly after payment or
prepayment in full of any Note, you shall surrender such Note for
cancellation, reasonably promptly after any such request, to the
Company at its principal executive office or at the place of payment
most recently designated by the Company pursuant to Section 14.1.
Prior to any sale or other disposition of any Note held by you or your
nominee you will, at your election, either endorse thereon the amount
of principal paid thereon and the last date to which interest has been
paid thereon or surrender such Note to the Company in exchange for a
new Note or Notes pursuant to Section 13.2. The Company will afford
the benefits of this Section 14.2 to any Institutional Investor that is
the direct or indirect transferee of any Note purchased by you under
this Agreement and that has made the same agreement relating to such
Note as you have made in this Section 14.2.
28
15. EXPENSES, ETC.
15.1. Transaction Expenses.
Whether or not the transactions contemplated hereby are
consummated, the Company will pay all costs and expenses (including
reasonable attorneys' fees of a special counsel and, if reasonably
required, local or other counsel) incurred by you and each Other
Purchaser or holder of a Note in connection with such transactions,
including, without limitation, filing fees due for submissions to the
National Association of Insurance Commissioners by any holder of Notes
in connection with this transaction, and in connection with any
amendments, waivers or consents under or in respect of this Agreement
or the Notes (whether or not such amendment, waiver or consent becomes
effective), including, without limitation: (a) the costs and expenses
incurred in enforcing or defending (or determining whether or how to
enforce or defend) any rights under this Agreement or the Notes or in
responding to any subpoena or other legal process or informal
investigative demand issued in connection with this Agreement or the
Notes, or by reason of being a holder of any Note, and (b) the costs
and expenses, including financial advisors' fees, incurred in
connection with the insolvency or bankruptcy of the Company or any
Subsidiary or in connection with any work-out or restructuring of the
transactions contemplated hereby and by the Notes. The Company will
pay, and will save you and each other holder of a Note harmless from,
all claims in respect of any fees, costs or expenses if any, of brokers
and finders (other than those retained by you).
15.2. Survival.
The obligations of the Company under this Section 15 will survive
the payment or transfer of any Note, the enforcement, amendment or
waiver of any provision of this Agreement or the Notes, and the
termination of this Agreement.
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.
All representations and warranties contained herein shall survive
the execution and delivery of this Agreement and the Notes, the
purchase or transfer by you of any Note or portion thereof or interest
therein and the payment of any Note, and may be relied upon by any
subsequent holder of a Note, regardless of any investigation made at
any time by or on behalf of you or any other holder of a Note. All
statements contained in any certificate or other instrument delivered
by or on behalf of the Company pursuant to this Agreement shall be
deemed representations and warranties of the Company under this
Agreement. Subject to the preceding sentence, this Agreement and the
Notes embody the entire agreement and understanding between you and the
Company and supersede all prior agreements and understandings relating
to the subject matter hereof.
17. AMENDMENT AND WAIVER.
17.1. Requirements.
This Agreement and the Notes may be amended, and the observance of
any term hereof or of the Notes may be waived (either retroactively or
prospectively), with (and only with) the written consent of the Company
and the Required Holders, except that (a) no amendment or waiver of any
of the provisions of any of Sections 1, 2, 3, 4, 5, 6 and 21, or any
defined term (as it is used therein), will be effective as to you
unless consented to by you in writing, and (b) no such amendment or
waiver may, without the written consent of the holder of each Note at
the time outstanding affected thereby, (i) subject to the provisions of
Section 12 relating to acceleration or rescission, change the amount or
time of any prepayment or payment of principal of, or reduce the rate
or change
29
the time of payment or method of computation of interest or of the Make-
Whole Amount on, the Notes, (ii) change the percentage of the principal
amount of the Notes the holders of which are required to consent to any
such amendment or waiver, or (iii) amend any of Sections 8, 11(a),
11(b), 12, 17 and 20.
17.2. Solicitation of Holders of Notes.
(a) Solicitation. The Company will provide each holder of
the Notes (irrespective of the amount of Notes then owned by it)
with sufficient information, sufficiently far in advance of the
date a decision is required, to enable such holder to make an
informed and considered decision with respect to any proposed
amendment, waiver or consent in respect of any of the provisions
hereof or of the Notes. The Company will deliver executed or true
and correct copies of each amendment, waiver or consent effected
pursuant to the provisions of this Section 17 to each holder of
outstanding Notes promptly following the date on which it is
executed and delivered by, or receives the consent or approval of,
the requisite holders of Notes.
(b) Payment. The Company will not directly or indirectly
pay or cause to be paid any remuneration, whether by way of
supplemental or additional interest, fee or otherwise, or grant
any security, to any holder of Notes as consideration for or as an
inducement to the entering into by any holder of Notes of any
waiver or amendment of any of the terms and provisions hereof
unless such remuneration is concurrently paid, or security is
concurrently granted, on the same terms, ratably to each holder of
Notes then outstanding even if such holder did not consent to such
waiver or amendment.
17.3. Binding Effect, etc.
Any amendment or waiver consented to as provided in this Section
17 applies equally to all holders of Notes and is binding upon them and
upon each future holder of any Note and upon the Company without regard
to whether such Note has been marked to indicate such amendment or
waiver. No such amendment or waiver will extend to or affect any
obligation, covenant, agreement, Default or Event of Default not
expressly amended or waived or impair any right consequent thereon. No
course of dealing between the Company and the holder of any Note nor
any delay in exercising any rights hereunder or under any Note shall
operate as a waiver of any rights of any holder of such Note. As used
herein, the term "this Agreement" and references thereto shall mean
this Agreement as it may from time to time be amended or supplemented.
17.4. Notes held by Company, etc.
Solely for the purpose of determining whether the holders of the
requisite percentage of the aggregate principal amount of Notes then
outstanding approved or consented to any amendment, waiver or consent
to be given under this Agreement or the Notes, or have directed the
taking of any action provided herein or in the Notes to be taken upon
the direction of the holders of a specified percentage of the aggregate
principal amount of Notes then outstanding, Notes directly or
indirectly owned by the Company or any of its Affiliates shall be
deemed not to be outstanding.
18. NOTICES.
All notices and communications provided for hereunder shall be in
writing and sent (a) by telecopier if the sender on the same day sends
a confirming copy of such notice by a recognized overnight delivery
service (charges prepaid), or (b) by registered or certified mail with
return receipt requested (postage prepaid), or (c) by a recognized
overnight delivery service (with charges prepaid). Any such notice
must be sent:
30
(i) if to you or your nominee, to you or it at the address
specified for such communications in Schedule A, or at such other
address as you or it shall have specified to the Company in
writing,
(ii) if to any other holder of any Note, to such holder at
such address as such other holder shall have specified to the
Company in writing, or
(iii) if to the Company, to the Company at its address set
forth at the beginning hereof to the attention of Xxxxxx X.
Xxxxxxxxxx, telecopier: (000) 000-0000, or at such other address
as the Company shall have specified to the holder of each Note in
writing.
Notices under this Section 18 will be deemed given only when actually
received.
19. REPRODUCTION OF DOCUMENTS.
This Agreement and all documents relating thereto, including,
without limitation, (a) consents, waivers and modifications that may
hereafter be executed, (b) documents received by you at the Closing
(except the Notes themselves), and (c) financial statements,
certificates and other information previously or hereafter furnished to
you, may be reproduced by you by any photographic, photostatic,
microfilm, microcard, miniature photographic or other similar process
and you may destroy any original document so reproduced. The Company
agrees and stipulates that, to the extent permitted by applicable law,
any such reproduction shall be admissible in evidence as the original
itself in any judicial or administrative proceeding (whether or not the
original is in existence and whether or not such reproduction was made
by you in the regular course of business) and any enlargement,
facsimile or further reproduction of such reproduction shall likewise
be admissible in evidence. This Section 19 shall not prohibit the
Company or any other holder of Notes from contesting any such
reproduction to the same extent that it could contest the original, or
from introducing evidence to demonstrate the inaccuracy of any such
reproduction.
20. CONFIDENTIAL INFORMATION.
For the purposes of this Section 20, "Confidential Information"
means information delivered to you by or on behalf of the Company or
any Subsidiary in connection with the transactions contemplated by or
otherwise pursuant to this Agreement that is proprietary in nature and
that was clearly marked or labeled or otherwise adequately identified
when received by you as being confidential information of the Company
or such Subsidiary, provided that such term does not include
information that
(a) was publicly known or otherwise known to you prior to
the time of such disclosure,
(b) subsequently becomes publicly known through no act or
omission by you or any person acting on your behalf,
(c) otherwise becomes known to you other than through
disclosure by the Company or any Subsidiary, or
(d) constitutes financial statements delivered to you under
Section 7.1 that are otherwise publicly available.
31
You will maintain the confidentiality of such Confidential Information
in accordance with procedures adopted by you in good faith to protect
confidential information of third parties delivered to you, provided
that you may deliver or disclose Confidential Information to:
(i) your directors, officers, trustees, employees, agents,
attorneys and affiliates (to the extent such disclosure reasonably
relates to the administration of the investment represented by
your Notes),
(ii) your financial advisors and other professional advisors
who agree to hold confidential the Confidential Information
substantially in accordance with the terms of this Section 20,
(iii) any other holder of any Note,
(iv) any Institutional Investor to which you sell or offer to
sell such Note or any part thereof or any participation therein
(if such Person has agreed in writing prior to its receipt of such
Confidential Information to be bound by the provisions of this
Section 20),
(v) any Person from which you offer to purchase any security
of the Company (if such Person has agreed in writing prior to its
receipt of such Confidential Information to be bound by the
provisions of this Section 20),
(vi) any federal or state regulatory authority having
jurisdiction over you,
(vii) the National Association of Insurance Commissioners or
any similar organization, or any nationally recognized rating
agency that requires access to information about your investment
portfolio or
(viii) any other Person to which such delivery or disclosure
may be necessary or appropriate
(A) to effect compliance with any law, rule, regulation
or order applicable to you,
(B) in response to any subpoena or other legal process,
(C) in connection with any litigation to which you are
a party provided the appropriateness of such delivery or
disclosure shall be made in light of the circumstances and
the nature of such Confidential Information, or
(D) if an Event of Default has occurred and is
continuing, to the extent you may reasonably determine such
delivery and disclosure to be necessary or appropriate in the
enforcement or for the protection of the rights and remedies
under your Notes and this Agreement.
Each holder of a Note, by its acceptance of a Note, will be deemed to
have agreed to be bound by and to be entitled to the benefits of this
Section 20 as though it were a party to this Agreement. On reasonable
request by the Company in connection with the delivery to any holder of
a Note of information required to be delivered to such holder under
this Agreement or requested by such holder (other than a holder that is
a party to this Agreement or its nominee), such holder will enter into
an agreement with the Company embodying the provisions of this Section
20.
32
21. SUBSTITUTION OF PURCHASER.
You shall have the right to substitute any one of your affiliates
as the purchaser of the Notes that you have agreed to purchase
hereunder, by written notice to the Company, which notice shall be
signed by both you and such affiliate, shall contain such affiliate's
agreement to be bound by this Agreement and shall contain a
confirmation by such affiliate of the accuracy with respect to it of
the representations set forth in Section 6. Upon receipt of such
notice, wherever the word "you" is used in this Agreement (other than
in this Section 21), such word shall be deemed to refer to such
affiliate in lieu of you. In the event that such affiliate is so
substituted as a purchaser hereunder and such affiliate thereafter
transfers to you all of the Notes then held by such affiliate, upon
receipt by the Company of notice of such transfer, wherever the word
"you" is used in this Agreement (other than in this Section 21), such
word shall no longer be deemed to refer to such affiliate, but shall
refer to you, and you shall have all the rights of an original holder
of the Notes under this Agreement.
22. MISCELLANEOUS.
22.1. Successors and Assigns.
All covenants and other agreements contained in this Agreement by
or on behalf of any of the parties hereto bind and inure to the benefit
of their respective successors and assigns (including, without
limitation, any subsequent holder of a Note) whether so expressed or
not.
22.2. Payments Due on Non-Business Days.
Anything in this Agreement or the Notes to the contrary
notwithstanding, any payment of principal of or Make-Whole Amount or
interest on any Note that is due on a date other than a Business Day
shall be made on the next succeeding Business Day without including the
additional days elapsed in the computation of the interest payable on
such next succeeding Business Day.
22.3. Severability.
Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability
without invalidating the remaining provisions hereof, and any such
prohibition or unenforceability in any jurisdiction shall (to the full
extent permitted by law) not invalidate or render unenforceable such
provision in any other jurisdiction.
22.4. Construction.
Each covenant contained herein shall be construed (absent express
provision to the contrary) as being independent of each other covenant
contained herein, so that compliance with any one covenant shall not
(absent such an express contrary provision) be deemed to excuse
compliance with any other covenant. Where any provision herein refers
to action to be taken by any Person, or which such Person is prohibited
from taking, such provision shall be applicable whether such action is
taken directly or indirectly by such Person.
22.5. Counterparts.
This Agreement may be executed in any number of counterparts, each
of which shall be an original but all of which together shall
constitute one instrument. Each counterpart may consist of a number of
copies hereof, each signed by less than all, but together signed by
all, of the parties hereto.
33
22.6. Governing Law.
THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE
STATE OF CONNECTICUT EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF
SUCH STATE THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF A
JURISDICTION OTHER THAN SUCH STATE.
[Remainder of page intentionally blank. Next page is signature page.]
34
If you are in agreement with the foregoing, please sign the
form of agreement on the accompanying counterpart of this Agreement and
return it to the Company, whereupon the foregoing shall become a
binding agreement between you and the Company.
Very truly yours,
THE ADVEST GROUP, INC.
By___________________________
Name:
Title:
The foregoing is hereby
agreed to as of the
date thereof.
[PURCHASER]
By
Name:
Title:
SCHEDULE A
Purchaser Name THE LINCOLN NATIONAL LIFE INSURANCE
COMPANY (INH)
Name in Which Note THE LINCOLN NATIONAL LIFE INSURANCE
is Registered COMPANY
Note Registration
Number; Principal
Amount R-1; $3,000,000
Payment on Account
of Note
Method Federal Funds Wire Transfer
Account Information Bankers Trust Company
New York, NY
ABA No.: 000000000
Private Placement Processing
A/C#: 00-000-000
For Further Credit to A/C of: The Lincoln
National Life Insurance Company (INH)
Custody Account No.: 98132
Accompanying Name of Company: The Advest Group, Inc.
Information Description of
Security: 7.95% Senior Notes due 2003
PPN: 007566 A* 3
Due Date and Application (as among principal,
Make-Whole Amount and interest) of the
payment being made:
Address for Notices Bankers Trust Company
Related to Payments Attn: Xxxxxxx Xxxxxxxxx Xxxx
X.X. Xxx 000; Xxxxxxx Xxxxx Xxxxxxx
Xxx Xxxx, XX 00000
with a copy to:
Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attn: Investments/Private Placements
Address for all Lincoln Investment Management, Inc.
other Notices 000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attn: Investments/Private Placements
Other Instructions THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
By: Lincoln Investment Management, Inc.,
Its Attorney-In-Fact
By___________________________________
Name:
Title:
Instructions re Bankers Trust Company
Delivery of Notes 00 Xxxx Xxxxxx, 0xx Xxxxx, Window #44
Xxx Xxxx, XX 00000
Attn: Xxxxxxx Xxxxxxx, Mail Stop 4049
Tax Identification
Number 00-0000000
Schedule A-1
Purchaser Name THE LINCOLN NATIONAL LIFE INSURANCE
COMPANY (UNA)
Name in Which Note THE LINCOLN NATIONAL LIFE INSURANCE
is Registered COMPANY
Note Registration
Number; Principal
Amount R-2; $4,000,000
Payment on Account
of Note
Method Federal Funds Wire Transfer
Account Information Bankers Trust Company
New York, NY
ABA No.: 000000000
Private Placement Processing
A/C#: 00-000-000
For Further Credit to A/C of: The Lincoln
National Life Insurance Company (UNA)
Custody Account No.: 98437
Accompanying Name of Company: The Advest Group, Inc.
Information Description of
Security: 7.95% Senior Notes due 2003
PPN: 007566 A* 3
Due Date and Application (as among principal,
Make-Whole Amount and interest) of the
payment being made:
Address for Notices Bankers Trust Company
Related to Payments Attn: Xxxxxxx Xxxxxxxxx Xxxx
X.X. Xxx 000; Xxxxxxx Xxxxx Xxxxxxx
Xxx Xxxx, XX 00000
with a copy to:
Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attn: Investments/Private Placements
Address for all Lincoln Investment Management, Inc.
other Notices 000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attn: Investments/Private Placements
Other Instructions THE LINCOLN NATIONAL LIFE INSURANCE
COMPANY
By: Lincoln Investment Management, Inc.,
Its Attorney-In-Fact
By___________________________
Name:
Title:
Instructions re Bankers Trust Company
Delivery of Notes 00 Xxxx Xxxxxx, 0xx Xxxxx, Window #44
Xxx Xxxx, XX 00000
Attn: Xxxxxxx Xxxxxxx, Mail Stop 4049
Tax Identification
Number 00-0000000
Schedule A-2
Purchaser Name THE LINCOLN NATIONAL LIFE INSURANCE
COMPANY (UIN)
Name in Which Note THE LINCOLN NATIONAL LIFE INSURANCE
is Registered COMPANY
Note Registration
Number; Principal
Amount R-3; $2,000,000
Payment on Account
of Note
Method Federal Funds Wire Transfer
Account Information Bankers Trust Company
New York, NY
ABA No.: 000000000
Private Placement Processing
A/C#: 00-000-000
For Further Credit to A/C of: The Lincoln
National Life Insurance Company (UIN)
Custody Account No.: 98127
Accompanying Name of Company: The Advest Group, Inc.
Information Description of
Security: 7.95% Senior Notes due 2003
PPN: 007566 A* 3
Due Date and Application (as among principal,
Make-Whole Amount and interest) of the
payment being made:
Address for Notices Bankers Trust Company
Related to Payments Attn: Xxxxxxx Xxxxxxxxx Xxxx
X.X. Xxx 000; Xxxxxxx Xxxxx Xxxxxxx
Xxx Xxxx, XX 00000
with a copy to:
Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attn: Investments/Private Placements
Address for all Lincoln Investment Management, Inc.
other Notices 000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attn: Investments/Private Placements
Other Instructions THE LINCOLN NATIONAL LIFE INSURANCE
COMPANY
By: Lincoln Investment Management, Inc.,
Its Attorney-In-Fact
By_______________________________
Name:
Title:
Instructions re Bankers Trust Company
Delivery of Notes 00 Xxxx Xxxxxx, 0xx Xxxxx, Window #44
Xxx Xxxx, XX 00000
Attn: Xxxxxxx Xxxxxxx, Mail Stop 4049
Tax Identification
Number 00-0000000
Schedule A-3
Purchaser Name THE LINCOLN NATIONAL LIFE INSURANCE
COMPANY (CRP)
Name in Which Note THE LINCOLN NATIONAL LIFE INSURANCE
is Registered COMPANY
Note Registration
Number; Principal
Amount R-4; $2,000,000
Payment on Account
of Note
Method Federal Funds Wire Transfer
Account Information Bankers Trust Company
New York, NY
ABA No.: 000000000
Private Placement Processing
A/C#: 00-000-000
For Further Credit to A/C of: The Lincoln
National Life Insurance Company (CRP)
Custody Account No.: 98231
Accompanying Name of Company: The Advest Group, Inc.
Information Description of
Security: 7.95% Senior Notes due 2003
PPN: 007566 A* 3
Due Date and Application (as among principal,
Make-Whole Amount and interest) of the
payment being made:
Address for Notices Bankers Trust Company
Related to Payments Attn: Xxxxxxx Xxxxxxxxx Xxxx
X.X. Xxx 000; Xxxxxxx Xxxxx Xxxxxxx
Xxx Xxxx, XX 00000
with a copy to:
Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attn: Investments/Private Placements
Address for all Lincoln Investment Management, Inc.
other Notices 000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attn: Investments/Private Placements
Other Instructions THE LINCOLN NATIONAL LIFE INSURANCE
COMPANY
By: Lincoln Investment Management, Inc.,
Its Attorney-In-Fact
By__________________________________
Name:
Title:
Instructions re Bankers Trust Company
Delivery of Notes 00 Xxxx Xxxxxx, 0xx Xxxxx, Window #44
Xxx Xxxx, XX 00000
Attn: Xxxxxxx Xxxxxxx, Mail Stop 4049
Tax Identification
Number 00-0000000
Schedule A-4
Purchaser Name ALLIED LIFE INSURANCE COMPANY "B"
Name in Which Note XXXXXXX & CO
is Registered
Note Registration
Number; Principal
Amount R-5; $2,000,000
Payment on Account
of Note
Method Federal Funds Wire Transfer
Account Information Citibank N.A.
New York, NY
ABA No.: 021 000 089
DDA Account No.: 000-000-00
Further credit: Allied Life Ins. Co.
Custody Account No.: 846591
Accompanying Name of Company: The Advest Group, Inc.
Information Description of
Security: 7.95% Senior Notes due 2003
PPN: 007566 A* 3
Due Date and Application (as among principal,
Make-Whole Amount and interest) of the
payment being made:
Address for Notices Citibank N.A.
Related to Payments Attention: Xxxxxxx Xxxxx 657-9174
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Address for all Lincoln Investment Management, Inc.
other Notices 000 Xxxx Xxxxx Xx; Renaissance Sq.
Xxxx Xxxxx, XX 00000
Attn: Investments/Private Placements
For A/C: Allied Life Insurance Company
Other Instructions ALLIED LIFE INSURANCE COMPANY
By: Lincoln Investment Management, Inc.,
Its Attorney-In-Fact
By_______________________________
Name:
Title:
Instructions re Citibank N.A.
Delivery of Notes Level C; 00 Xxxxxxxx Xxxxx
Xxx Xxxx, XX 00000
For Account: Allied Life Insurance Co.
Custodial Account No.: 846591
Attn: Xxx Xxxxxxx
Tax Identification
Number 00-0000000
Schedule A-5
Purchaser Name AMERICAN STATES LIFE INSURANCE COMPANY
(UNIVERSAL LIFE ACCOUNT)
Name in Which Note XXXXXXX & CO
is Registered
Note Registration
Number; Principal
Amount R-6; $2,000,000
Payment on Account
of Note
Method Federal Funds Wire Transfer
Account Information Bankers Trust Company
New York, NY
ABA # 000000000
Private Placement Processing
A/C#: 00-000-000
Further credit to: a/c 97149 American STS
Life (Universal)
Accompanying Name of Company: The Advest Group, Inc.
Information Description of
Security: 7.95% Senior Notes due 2003
PPN: 007566 A* 3
Due Date and Application (as among principal,
Make-Whole Amount and interest) of the
payment being made:
Address for Notices American States Life Insurance Company
Related to Payments 000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attn: Corporate Accounting
Address for all Lincoln Investment Management, Inc.
other Notices 000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attn: Investments/Private Placements
Other Instructions AMERICAN STATES LIFE INSURANCE COMPANY
By: Lincoln Investment Management, Inc.,
Its Attorney-In-Fact
By________________________________
Name:
Title:
Instructions re Bankers Trust Company
Delivery of Notes 00 Xxxx Xxxxxx, 0xx Xxxxx, Window 00
Xxx Xxxx, Xxx Xxxx 00000
For Acct: 97149 American Sts Life (Universal)
Attention: Xxxxxx Xxxxxx
Tax Identification
Number 00-0000000
Schedule A-6
Purchaser Name AMERICAN STATES LIFE INSURANCE COMPANY
(ANNUITY ACCOUNT)
Name in Which Note XXXXXXX & CO
is Registered
Note Registration
Number; Principal
Amount R-7; $1,000,000
Payment on Account
of Note
Method Federal Funds Wire Transfer
Account Information Bankers Trust Company
New York, NY
ABA #: 000000000
Private Placement Processing
A/C#: 00-000-000
Further credit to: a/c 97151 American STS
Life (Annuity)
Accompanying Name of Company: The Advest Group, Inc.
Information Description of
Security: 7.95% Senior Notes due 2003
PPN: 007566 A* 3
Due Date and Application (as among principal,
Make-Whole Amount and interest) of the
payment being made:
Address for Notices American States Life Insurance Company
Related to Payments 000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attn: Corporate Accounting
Address for all Lincoln Investment Management, Inc.
other Notices 000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attn: Investments/Private Placements
Other Instructions AMERICAN STATES LIFE INSURANCE COMPANY
By: Lincoln Investment Management, Inc.,
Its Attorney-In-Fact
By__________________________________
Name:
Title:
Instructions re Bankers Trust Company
Delivery of Notes 00 Xxxx Xxxxxx, 0xx Xxxxx, Window 00
Xxx Xxxx, Xxx Xxxx 00000
For Acct: 97151 American Sts Life (Annuity)
Attention: Xxxxxx Xxxxxx
Tax Identification
Number 00-0000000
Schedule A-7
Purchaser Name FEDERAL WARRANTY SERVICE CORPORATION
Name in Which Note FEDERAL WARRANTY SERVICE CORPORATION
is Registered
Note Registration
Number; Principal
Amount R-8; $1,000,000
Payment on Account
of Note
Method Federal Funds Wire Transfer
Account Information Chase Manhattan Bank
New York, NY
ABA # 021 000 021
Attn: Investment Dept.
For A/C: Federal Warranty Svc. Corp
A/C: N7631139
Accompanying Name of Company: The Advest Group, Inc.
Information Description of
Security: 7.95% Senior Notes due 2003
PPN: 007566 A* 3
Due Date and Application (as among principal,
Make-Whole Amount and interest) of the
payment being made:
Address for Notices American Bankers Insurance Group
Related to Payments For A/C: Federal Warranty Service Corp.
00000 Xxxxx Xxxxx Xxxxx
Xxxxx, XX 00000
Attn: Investment Department
Address for all Lincoln Investment Management, Inc.
other Notices 000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attn: Investments/Private Placements
Other Instructions FEDERAL WARRANTY SERVICE CORPORATION
By: Lincoln Investment Management, Inc.,
Its Attorney-In-Fact
By________________________________
Name:
Title:
Instructions re American Bankers Insurance Group
Delivery of Notes For A/C: Federal Warranty Service Corp.
00000 Xxxxx Xxxxx Xxxxx
Xxxxx, XX 00000
Attention: Xxxxxx Xxxxxxxxx/Investments
Tax Identification
Number 00-0000000
Schedule A-8
Purchaser Name FIRST PENN-PACIFIC LIFE INSURANCE COMPANY
Name in Which Note XXXX & CO
is Registered
Note Registration
Number; Principal
Amount R-9; $2,000,000
Payment on Account
of Note
Method Federal Funds Wire Transfer
Account Information Chase Manhattan Bank
New York, NY
ABA # 000000000
A/C: 000-0-000000
Further credit to: G-05996 First Penn-Pacific
Accompanying Name of Company: The Advest Group, Inc.
Information Description of
Security: 7.95% Senior Notes due 2003
PPN: 007566 A* 3
Due Date and Application (as among principal,
Make-Whole Amount and interest) of the
payment being made:
Address for Notices Lincoln Investment Management, Inc.
Related to Payments 000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attn: Investments/Private Placements
Address for all Lincoln Investment Management, Inc.
other Notices 000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attn: Investments/Private Placements
Other Instructions FIRST PENN-PACIFIC LIFE INSURANCE COMPANY
By: Lincoln Investment Management, Inc.,
Its Attorney-In-Fact
By____________________________________
Name:
Title:
Instructions re Chase Manhattan Bank
Delivery of Notes 4 New York Plaza
Ground Floor Window
Xxx Xxxx, XX 00000
For Account: G-05996 First Penn-Pacific
Life Ins. Co.
Att: Xxxxx Xxxxxx - Receive Free Cage
(Tel 000-000-0000)
Tax Identification
Number 00-0000000
Schedule A-9
Purchaser Name PHOENIX HOME LIFE MUTUAL INSURANCE COMPANY
Name in Which Note PHOENIX HOME LIFE MUTUAL INSURANCE COMPANY
is Registered
Note Registration
Number; Principal
Amount R-10; $10,000,000
Payment on Account
of Note
Method Federal Funds Wire Transfer
Account Information Chase Manhattan Bank, N.A.
New York, New York
Income Processing
Account 900 9000 200
ABA #: 000-000-000
Credit to: Phoenix Home Life Acct.
Account G05143
Accompanying Name of Company: The Advest Group, Inc.
Information Description of
Security: 7.95% Senior Notes due 2003
PPN: 007566 A* 3
Due Date and Application (as among principal,
Make-Whole Amount and interest) of the
payment being made:
Address for Notices Phoenix Home Life Mutual Insurance Company
Related to Payments c/o Phoenix Duff & Xxxxxx
Attn: Private Placements
00 Xxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000-0000
Fax: (000) 000-0000
Address for all Phoenix Home Life Mutual Insurance Company
other Notices c/o Phoenix Duff & Xxxxxx
Attn: Private Placements
00 Xxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000-0000
Fax: (000) 000-0000
Other Instructions PHOENIX HOME LIFE MUTUAL INSURANCE COMPANY
By_________________________________
Name:
Title:
Instructions re
Delivery of Notes Law Department of Purchaser
Tax Identification
Number 00-0000000
Schedule A-10
Purchaser Name SUNAMERICA LIFE INSURANCE COMPANY
Name in Which Note OKGBD & CO.
is Registered
Note Registration
Number; Principal
Amount R-11; $3,000,000
Payment on Account
of Note
Method Federal Funds Wire Transfer
Account Information Bankers Trust Company
ABA #: 000-000-000
Account #: 00-000-000
For further credit to acct. #: 099530
Accompanying Name of Company: The Advest Group, Inc.
Information Description of
Security: 7.95% Senior Notes due 2003
PPN: 007566 A* 3
Due Date and Application (as among principal,
Make-Whole Amount and interest) of the
payment being made:
Address for Notices SunAmerica Investments
Related to Payments 0 XxxXxxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000-0000
Attn: Investment Accounting, 36th Floor
Telephone: (000) 000-0000
Fax: (000) 000-0000
Address for all SunAmerica Corporate Finance
other Notices 0 XxxXxxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000-0000
Attn: Xxxxxx Xxxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Other Instructions SUNAMERICA LIFE INSURANCE COMPANY
By__________________________________
Name:
Title:
Instructions re Bankers Trust Company
Delivery of Notes 00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
4th Floor, Window 44
Account #099530
Tax Identification 00-0000000 (OKGBD & Co.) 00-0000000
Number (SunAmerica Life Insurance Company)
Schedule A-11
Purchaser Name ANCHOR NATIONAL LIFE INSURANCE COMPANY
Name in Which Note OKGBD & CO.
is Registered
Note Registration
Number; Principal
Amount R-12; $3,000,000
Payment on Account
of Note
Method Federal Funds Wire Transfer
Account Information Bankers Trust Company
ABA #: 000-000-000
Account #: 00-000-000
For further credit to acct. #: 099527
Accompanying Name of Company: The Advest Group, Inc.
Information Description of
Security: 7.95% Senior Notes due 2003
PPN: 007566 A* 3
Due Date and Application (as among principal,
Make-Whole Amount and interest) of the
payment being made:
Address for Notices SunAmerica Investments
Related to Payments 0 XxxXxxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000-0000
Attn: Investment Accounting, 36th Floor
Telephone: (000) 000-0000
Fax: (000) 000-0000
Address for all SunAmerica Corporate Finance
other Notices 0 XxxXxxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000-0000
Attn: Xxxxxx Xxxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Other Instructions ANCHOR NATIONAL LIFE INSURANCE COMPANY
By_________________________
Name:
Title:
Instructions re Bankers Trust Company
Delivery of Notes 00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
4th Floor, Window 44
Account #099527
Tax Identification 00-0000000 (OKGBD & Co.) 00-0000000
Number (Anchor National Life Insurance Company)
Schedule A-12
SCHEDULE B
DEFINED TERMS
As used herein, the following terms have the respective meanings
set forth below or set forth in the Section hereof following such term:
"Advest" means Advest, Inc., a Delaware corporation.
"Affiliate" means at any time, a Person,
(a) that at such time directly or indirectly through one or
more intermediaries Controls, or is Controlled by, or is under
common Control with, the Company,
(b) that beneficially owns or holds, directly or indirectly,
5% or more of any class of Voting Interests of the Company or any
Subsidiary,
(c) of which the Company and its Subsidiaries beneficially
own or hold, in the aggregate, directly or indirectly, 5% or more
of any class of Voting Interests, or
(d) that is an executive officer (as defined in the rules
and regulations of the SEC) or director (or any member of the
immediate family of an executive officer or director) of the
Company,
at such time.
As used in this definition, "Control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the
management and policies of a Person, whether through the ownership of
voting securities, by contract or otherwise. Unless the context
otherwise clearly requires, any reference to an "Affiliate" is a
reference to an Affiliate of the Company.
"Agreement, this" is defined in Section 17.3.
"Broker-Dealer Subsidiary" means Advest and each other Subsidiary
which is registered as a broker-dealer with the SEC under the Exchange
Act after the date of the Closing
"Business Day" means (a) for the purposes of Section 8.6 only, any
day other than a Saturday, a Sunday or a day on which commercial banks
in Hartford, Connecticut or New York, New York are required or
authorized to be closed, and (b) for the purposes of any other
provision of this Agreement, any day other than a Saturday, a Sunday or
a day on which commercial banks in Hartford, Connecticut or New York,
New York are required or authorized to be closed.
"Business Entity" means a partnership, corporation, limited
liability company, trust, or unincorporated forprofit organization.
"Capital Lease" means, at any time, a lease with respect to which
the lessee is required concurrently to recognize the acquisition of an
asset and the incurrence of a liability in accordance with GAAP.
Schedule B-1
"Capital Stock" means any class of capital stock, share capital or
similar equity interest of a Person.
"Closing" is defined in Section 3.
"Code" means the Internal Revenue Code of 1986, as amended from
time to time, and the rules and regulations promulgated thereunder from
time to time.
"Company" is defined in the introductory sentence of this
Agreement.
"Confidential Information" is defined in Section 20.
"Consolidated Funded Debt" means, as of any date of determination,
the total of all Funded Debt of the Company and its Subsidiaries
outstanding on such date, after eliminating all offsetting debits and
credits between the Company and its Subsidiaries and all other items
required to be eliminated in the course of the preparation of
consolidated financial statements of the Company and its Subsidiaries
in accordance with GAAP.
"Consolidated Net Income" means, with reference to any period, the
net income (or loss) of the Company and its Subsidiaries for such
period (taken as a cumulative whole), as determined in accordance with
GAAP, after eliminating all offsetting debits and credits between the
Company and its Subsidiaries and all other items required to be
eliminated in the course of the preparation of consolidated financial
statements of the Company and its Subsidiaries in accordance with GAAP.
"Consolidated Net Worth" means, at any time,
(a) the total assets of the Company and its Subsidiaries
(excluding from the determination thereof the amount equal to the
outstanding Defeased GECC Debt at such time) which would be shown
as assets on a consolidated balance sheet of the Company and its
Subsidiaries as of such time prepared in accordance with GAAP,
after eliminating all amounts properly attributable to minority
interests, if any, in the stock and surplus of Subsidiaries, minus
(b) the total liabilities of the Company and its
Subsidiaries (other than the Defeased GECC Debt) which would be
shown as liabilities on such balance sheet.
"Consolidated Senior Funded Debt" means, as of any date of
determination, the total of all Consolidated Funded Debt (other than
Subordinated Funded Debt) outstanding on such date.
"Consolidated Subsidiary Debt" means, as of any date of
determination, the total of all Debt of the Subsidiaries of the Company
outstanding on such date, after eliminating all offsetting debits and
credits among the Subsidiaries of the Company.
"Current Maturities of Funded Debt" means, at any time and with
respect to any item of Funded Debt, the portion of such Funded Debt
outstanding at such time which by the terms of such Funded Debt or the
terms of any instrument or agreement relating thereto is due on demand
or within one year from such time (whether by sinking fund, other
required prepayment or final payment at maturity) and is not directly
or indirectly renewable, extendible or refundable at the option of the
obligor under an agreement or firm commitment in effect at such time to
a date one year or more from such time.
Schedule B-2
"Debt" means, with respect to any Person, without duplication,
(a) its liabilities for borrowed money and its redemption
obligations in respect of mandatorily redeemable Preferred Stock;
(b) its liabilities for the deferred purchase price of
property acquired by such Person (excluding accounts payable
arising in the ordinary course of business but including all
liabilities created or arising under any conditional sale or other
title retention agreement with respect to any such property);
(c) all liabilities appearing on its balance sheet in
accordance with GAAP in respect of Capital Leases;
(d) all liabilities for borrowed money secured by any Lien
with respect to any property owned by such Person (whether or not
it has assumed or otherwise become liable for such liabilities);
(e) all its liabilities in respect of letters of credit or
instruments serving a similar function issued or accepted for its
account by banks and other financial institutions (whether or not
representing obligations for borrowed money);
(f) Swaps of such Person; and
(g) any Guaranty of such Person with respect to liabilities
of a type described in any of clauses (a) through (f) hereof;
provided, that, with respect to the Company and its Subsidiaries,
liabilities arising under customary arrangements utilized in the broker-
dealer or commercial banking industries shall not be deemed to be Debt.
Without limitation of the foregoing, Debt of any Person shall include
all obligations of such Person of the character described in clauses
(a) through (g) to the extent such Person remains legally liable in
respect thereof notwithstanding that any such obligation is deemed to
be extinguished under GAAP.
"Default" means an event or condition the occurrence or existence
of which would, with the lapse of time or the giving of notice or both,
become an Event of Default.
"Default Rate" means that rate of interest that is the greater of
(i) 2% per annum above the rate of interest stated in clause (a) of the
first paragraph of the Notes or (ii) 2% over the rate of interest
publicly announced from time to time by Xxxxxx Guaranty Trust Company
of New York in New York, City (or its successor) as its "base" or
"prime" rate.
"Defeased GECC Debt" means Debt of the Company outstanding on the
date of the Closing owing to General Electric Capital Corporation under
that certain Secured Equipment Note so long as such Debt is
indefeasibly paid in full on or before April 30, 1997.
"Environmental Laws" means any and all Federal, state, local, and
foreign statutes, laws, regulations, ordinances, rules, judgments,
orders, decrees, permits, concessions, grants, franchises, licenses,
agreements or governmental restrictions relating to pollution and the
protection of the environment or the release of any materials into the
environment, including but not limited to those related to hazardous
substances or wastes, air emissions and discharges to waste or public
systems.
Schedule B-3
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the rules and regulations promulgated
thereunder from time to time in effect.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that is treated as a single employer together with the
Company under section 414 of the Code.
"Event of Default" is defined in Section 11.
"Examining Authority" means, at any time in respect of any Broker-
Dealer Subsidiary, an "Examining Authority" (as such term is defined
Rule 15c3-1) with respect to such Broker-Dealer Subsidiary at such
time.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time.
"Funded Debt" means all Debt of a Person which by its terms or by
the terms of any instrument or agreement relating thereto matures, or
which is otherwise payable or unpaid, one year or more from, or is
directly or indirectly renewable or extendible at the option of the
obligor in respect thereof to a date one year or more (including,
without limitation, an option of such obligor under a revolving credit
or similar agreement obligating the lender or lenders to extend credit
over a period of one year or more) from, the date of the creation
thereof, provided that Funded Debt shall include, as at any date of
determination, Current Maturities of Funded Debt.
"GAAP" means generally accepted accounting principles as in effect
from time to time in the United States of America.
"Governmental Authority" means
(a) the government of
(i) the United States of America or any state or other
political subdivision thereof, or
(ii) any jurisdiction in which the Company or any
Subsidiary conducts all or any part of its business, or that
asserts jurisdiction over any properties of the Company or
any Subsidiary, or
(b) any entity exercising executive, legislative, judicial,
regulatory or administrative functions of, or pertaining to, any
such government, including, without limitation, NYSE and NASD.
Guaranty" means, with respect to any Person, any obligation
(except the endorsement in the ordinary course of business of
negotiable instruments for deposit or collection) of such Person
guaranteeing or in effect guaranteeing any indebtedness, dividend or
other obligation of any other Person in any manner, whether directly or
indirectly, including, without limitation, obligations incurred through
an agreement, contingent or otherwise, by such Person:
(a) to purchase such indebtedness or obligation or any
property constituting security therefor;
Schedule B-4
(b) to advance or supply funds (i) for the purchase or
payment of such indebtedness or obligation, or (ii) to maintain
any working capital or other balance sheet condition or any income
statement condition of any other Person or otherwise to advance or
make available funds for the purchase or payment of such
indebtedness or obligation;
(c) to lease properties or to purchase properties or
services primarily for the purpose of assuring the owner of such
indebtedness or obligation of the ability of any other Person to
make payment of the indebtedness or obligation; or
(d) otherwise to assure the owner of such indebtedness or
obligation against loss in respect thereof, including, without
limitation, by pledging property of such Person as security for
such indebtedness or obligation.
In any computation of the indebtedness or other liabilities of the
obligor under any Guaranty, the indebtedness or other obligations that
are the subject of such Guaranty shall be assumed to be direct
obligations of such obligor.
"Hazardous Material" means any and all pollutants, toxic or
hazardous wastes or any other substances that might pose a hazard to
health or safety, the removal of which may be required or the
generation, manufacture, refining, production, processing, treatment,
storage, handling, transportation, transfer, use, disposal, release,
discharge, spillage, seepage, or filtration of which is or shall be
restricted, prohibited or penalized by any applicable law (including,
without limitation, asbestos, urea formaldehyde foam insulation and
polychlorinated biphenyls).
"holder" means, with respect to any Note, the Person in whose name
such Note is registered in the register maintained by the Company
pursuant to Section 13.1.
"Institutional Investor" means (a) any original purchaser of a
Note, (b) any holder of a Note holding more than 5% of the aggregate
principal amount of the Notes then outstanding, and (c) any bank, trust
company, savings and loan association or other financial institution,
any pension plan, any investment company, any insurance company, any
broker or dealer, or any other similar financial institution or entity,
regardless of legal form.
"Lien" means, with respect to any Person, any mortgage, lien,
pledge, charge, security interest or other encumbrance, or any interest
or title of any vendor, lessor, lender or other secured party to or of
such Person under any conditional sale or other title retention
agreement or Capital Lease, upon or with respect to any property or
asset of such Person (including in the case of stock, stockholder
agreements, voting trust agreements and all similar arrangements).
"Make-Whole Amount" is defined in Section 8.6.
"Material" means material in relation to the business, operations,
affairs, financial condition, assets, properties, or prospects of the
Company and its Subsidiaries taken as a whole.
"Material Adverse Effect" means a material adverse effect on (a)
the business, operations, affairs, financial condition, assets or
properties of the Company and its Subsidiaries taken as a whole, or (b)
the ability
Schedule B-5
of the Company to perform its obligations under this Agreement and the
Notes, or (c) the validity or enforceability of this Agreement or the
Notes.
"Material Subsidiary" means each of the Subsidiaries designated as
a Material Subsidiary in paragraph (iii) of Schedule 5.4.
"Memorandum" is defined in Section 5.3.
"Multiemployer Plan" means any Plan that is a "multiemployer plan"
(as such term is defined in section 4001(a)(3) of ERISA).
"NASD" means the National Association of Securities Dealers, Inc.
and any successor organization discharging the regulatory functions of
the National Association of Securities Dealers, Inc.
"Notes" is defined in Section 1.
"NYSE" means, at any time with respect to any Broker-Dealer
Subsidiary, the New York Stock Exchange, Inc., or if such Broker-Dealer
Subsidiary shall have been terminated as a member of the NYSE as of
such time, then "NYSE" shall mean the Examining Authority in respect of
such Broker-Dealer Subsidiary at such time.
"NYSE Net Capital" means, at any time with respect to a Broker-
Dealer Subsidiary, the "net capital" of such BrokerDealer Subsidiary at
such time, computed in accordance with Rule 325 of the NYSE, or any
later enacted rule of the NYSE that supersedes such Rule 325 or the
substantially equivalent rule of the Examining Authority in respect of
such Broker-Dealer Subsidiary, at such time.
"NYSE Required Net Capital" means, at any time with respect to any
Broker-Dealer Subsidiary, the minimum amount to which NYSE Net Capital
must be equal at such time in order to permit such Broker-Dealer to
"expand its business" as defined by and pursuant to Rule 326(a)(1)(c)
of the NYSE, or any later enacted rule of the NYSE that supersedes such
Rule 326(a)(1)(c) or the substantially equivalent rule of the Examining
Authority in respect of such Broker-Dealer Subsidiary, at such time.
"Officer's Certificate" means a certificate of a Senior Financial
Officer or of any other officer of the Company whose responsibilities
extend to the subject matter of such certificate.
"Other Agreements" is defined in Section 2.
"Other Purchasers" is defined in Section 2.
"PBGC" means the Pension Benefit Guaranty Corporation referred to
and defined in ERISA or any successor thereto.
"Person" means an individual, partnership, corporation, limited
liability company, association, trust, unincorporated organization, or
a government or agency or political subdivision thereof.
"Plan" means an "employee benefit plan" (as defined in section
3(3) of ERISA) that is or, within the preceding
Schedule B-6
five years, has been established or maintained, or to which
contributions are or, within the preceding five years, have been made
or required to be made, by the Company or any ERISA Affiliate or with
respect to which the Company or any ERISA Affiliate may have any
liability.
"Preferred Stock" means any class of Capital Stock of a Person
that is preferred over any other class of Capital Stock of such Person
as to the payment of dividends or other equity distributions or the
payment of any amount upon liquidation or dissolution of such Person.
"property or properties" means, unless otherwise specifically
limited, real or personal property of any kind, tangible or intangible,
xxxxxx or inchoate.
"QPAM Exemption" means Prohibited Transaction Class Exemption 84-
14 issued by the United States Department of Labor.
"Qualified Institutional Buyer" means any Person who is a
"qualified institutional buyer" within the meaning of such term as set
forth in Rule 144A(a)(1) under the Securities Act.
"Required Holders" means, at any time, the holder or holders of at
least 66 % in principal amount of the Notes at the time outstanding
(exclusive of Notes then owned by the Company or any of its
Affiliates).
"Responsible Officer" means any Senior Financial Officer and any
other officer of the Company with responsibility for the administration
of the relevant portion of this Agreement.
"Rule 15c3-1" means 17 C.F.R. 240.15c3-1 as amended from time to
time, and any successor rule or regulation of the SEC regulating the
same subject matter.
"SEC" means the Securities and Exchange Commission and any
successor organization discharging the regulatory functions of the
Securities and Exchange Commission.
"SEC Net Capital" means, at any time with respect to any Broker-
Dealer Subsidiary, the "net capital" of such Broker-Dealer Subsidiary
at such time, computed in accordance with Rule 15c3-1.
"SEC Required Net Capital" means, at any time with respect to any
Broker-Dealer Subsidiary, the minimum amount to which SEC Net Capital
must be equal at such time pursuant to Rule 15c3-1 to remain in
compliance with all provisions thereof applicable to such Broker-
Dealer.
"Securities Act" means the Securities Act of 1933, as amended from
time to time.
"Senior Financial Officer" means the chief financial officer,
principal accounting officer, treasurer or comptroller of the Company.
"SIPA" means the Securities Investor Protection Act of 1970,
together with all rules and regulations promulgated pursuant thereto,
as amended.
"SIPC" means the Securities Investor Protection Corporation and
any successor organization discharging the functions of the Securities
Investor Protection Corporation.
Schedule B-7
"Subordinated Funded Debt" means any Funded Debt that (a) as of
the date of determination, has a Weighted Average Life which is greater
than the Weighted Average Life of the Notes or (b) is subordinated in
right of payment in a liquidation of the Company to the Debt evidenced
by the Notes.
"Subsidiary" means, as to any Person, any corporation, association
or other business entity in which such Person or one or more of its
Subsidiaries or such Person and one or more of its Subsidiaries owns
sufficient equity or Voting Interests to enable it or them (as a group)
ordinarily, in the absence of contingencies, to elect a majority of the
directors (or Persons performing similar functions) of such entity, and
any partnership or joint venture if more than a 50% interest in the
profits or capital thereof is owned by such Person or one or more of
its Subsidiaries or such Person and one or more of its Subsidiaries
(unless such partnership can and does ordinarily take major business
actions without the prior approval of such Person or one or more of its
Subsidiaries). Unless the context otherwise clearly requires, any
reference to a "Subsidiary" is a reference to a Subsidiary of the
Company.
"Swaps" means, with respect to any Person, payment obligations
with respect to interest rate swaps, currency swaps and similar
obligations obligating such Person to make payments, whether
periodically or upon the happening of a contingency. For the purposes
of this Agreement, the amount of the obligation under any Swap shall be
the amount determined in respect thereof as of the end of the then most
recently ended fiscal quarter of such Person, based on the assumption
that such Swap had terminated at the end of such fiscal quarter, and in
making such determination, if any agreement relating to such Swap
provides for the netting of amounts payable by and to such Person
thereunder or if any such agreement provides for the simultaneous
payment of amounts by and to such Person, then in each such case, the
amount of such obligation shall be the net amount so determined.
Voting Interest -- means
(a) in the case of a corporation, any capital stock of any
class the holders of which are ordinarily, in the absence of
contingencies, entitled to elect a majority of corporate directors
(or Persons performing similar functions),
(b) in the case of any partnership, a general partnership
interest therein, even if responsibility for management of such
partnership is vested, by contract or otherwise, in any Person
other than the holder of such general partnership interest, and
the percentage of Voting Interests in such partnership held by
such general partner shall be deemed to be its percentage capital
contributions thereto, and
(c) in the case of other Business Entities, any class of
equity or beneficial interest which
(i) ordinarily, in the absence of contingencies, is
entitled to elect a majority of Persons carrying out or
supervising the carrying out of the management of the
Business Entity, or
(ii) grants to the holder thereof the right to carry out
or supervise the carrying out of the management of the
Business Entity.
"Weighted Average Life" means, with respect to any date and
principal amount of Debt, the number of years obtained by dividing (a)
the Remaining Dollar-Years with respect to such date and such principal
amount of Debt by (b) such principal amount of Debt.
Schedule B-8
As used in this definition:
Remaining Dollar-Years -- means, with respect to any date and
principal amount of Debt, the result obtained by
(a) multiplying
(i) an amount equal to each then remaining
required payment of principal (including repayment at
final maturity) of such Debt unpaid immediately prior to
such date, by
(ii) the number of years (calculated to the nearest
one-twelfth (1/12)) that will elapse between such date
and the date each such required payment of principal is
due, and
(b) calculating the sum of each of the products
obtained in the preceding clause (a).
"Wholly-Owned Subsidiary" means, at any time, any Subsidiary 100%
of all of the equity interests (except directors' qualifying shares)
and Voting Interests of which are owned by any one or more of the
Company and the Company's other Wholly-Owned Subsidiaries at such time.
Schedule B-9
SCHEDULE 4.9
CHANGES IN CORPORATE STRUCTURE
None.
Schedule 4.9-1
SCHEDULE 5.3
DISCLOSURE MATERIALS
None.
Schedule 5.3-1
SCHEDULE 5.4
SUBSIDIARIES OF THE COMPANY AND OWNERSHIP OF SUBSIDIARY STOCK
(i)
Jurisdiction Percent
Name Incorporated Ownership
The Advest Group, Inc. Delaware Public
Advest, Inc. Delaware 100%
Advest Insurance Agency, Inc. Massachusetts 100%
Balanced Capital Services, Inc. Connecticut 100%
Advest Bank Connecticut 100%
Admass Corp. Massachusetts 100%
Admyst Corp. Connecticut 100%
Advest Mortgage Corp. Connecticut 100%
Advest Credit Corporation Connecticut 100%
A.B. Realty Corp. Connecticut 100%
Xxxxxx Xxxxx Development Corp. Connecticut 100%
Salem Corp. of CT Connecticut 100%
Advest Capital Inc. Connecticut 100%
Advest Properties, Inc. Delaware 100%
Xxxxxxxx & Company, Inc. Connecticut 100%
Xxxxxxxx Management Co. Connecticut 100%
Boston Security Counsellors, Inc. Massachusetts 100%
Central Row Corp. Connecticut 100%
SRNY, Ltd. Connecticut 100%
Coordinated Planning, Ltd. New York 100%
The Hannah Consulting Group, Inc. Connecticut 100%
Xxxxxx Insurance Agency, Inc. Ohio 100%
The following additional subsidiaries are inactive:
Advest Transfer Services, Inc. Delaware 100%
Xxxxx, Zomback & Xxxxxxxxx, Inc. Delaware 100%
XXXX, Inc. Delaware 100%
Xxxx Xxxxxx, Xxxxxxx & Xxxxxxx Delaware 100%
*Advest Group holds 2,997 shares of Class B nonvoting common stock. To
comply with Ohio regulatory requirements, 3 shares of Class A voting
common stock are held by individuals. Advest Group maintains an
irrevocable voting proxy over these shares.
Schedule 5.4-1
(ii) The following own in excess of 5% of the outstanding stock of the
Advest Group and may be deemed "Affiliates":
Shares Percent
Xx. Xxxxx X. Xxxxxxx
c/o Spear, Leeds & Xxxxxxx
000 Xxxxxxxx
Xxx Xxxx, XX 00000 1,564,500(1) 18.62%
The Advest Thrift Plan
Advest, Inc., as Fiduciary
00 Xxxxx Xxxxx Xxxxxx
Xxxxxxxx, XX 00000 692,759(2) 8.24%
(1) Such information as to beneficial ownership is derived in from a
Report on Form 4 for the month of November 1993 filed by Xx. Xxxxxxx.
(2) Represents shares held by the Advest Thrift Plan of the Company
(the "ATP") in participant ESOP accounts (581,552 shares) and 401(k)
accounts (87,699) and shares issuable upon conversion of the Company's
9% Convertible Subordinated Debentures held in ATP 401(k) accounts
(23,508). Advest, Inc. acts as trustee for the ATP.
(iii) The following are deemed to be "Material Subsidiaries:"
Advest, Inc.
Advest Bank
Schedule 5.4-2
SCHEDULE 5.5
FINANCIAL STATEMENTS
The Company has delivered to each Purchaser copies of the Consolidated
Financial Statements and the Report of Independent Accounts contained
in the 1996 Annual Report to Shareholders.
Schedule 5.5-1
SCHEDULE 5.8
CERTAIN LITIGATION
None.
Schedule 5.8-1
SCHEDULE 5.11
PATENTS, ETC.
None.
Note that Advest is presently involved in a dispute with another
corporation concerning the right of that other corporation to use the
name "Advest Capital" in Georgia.
Schedule 5.11-1
SCHEDULE 5.12
ERISA AFFILIATES
(a) Each of the entities listed on Schedule 5.4 constitutes an
"ERISA Affiliate" of the Company.
(b) The following constitute "employee benefit plans" maintained
by the Company or any affiliate.
1. Advest Thrift Plan
2. AE Nonqualified Defined Benefit Plan
3. Nonqualified Executive Post-Employment Income Plan with Amendments
4. Medical Care Spending Account and Medical Insurance
5. Disability and Life Insurance Coverage
6. Severance policies
Schedule 5.12-1
SCHEDULE 5.14
USE OF PROCEEDS
The Company will use the proceeds of the Notes as follows:
(a) to prepay the following Debt of the Company:
1. the 9% Convertible Subordinated Debentures due 2008
in the outstanding principal amount of $20,552,000 to be paid
on or about January 31, 1997;
2. the Notes due to Fleet Bank in the outstanding
principal amount of $4,320,459.12 to be paid on or before
December 31, 1996; and
3. the Secured Equipment Note due to GE Capital
Corporation in the outstanding principal amount of $6,250,000
to be paid on or before April 30, 1997;
(b) to pay the expenses incurred in connection with the
transactions contemplated by this Agreement; and
(c) for general corporate purposes.
Schedule 5.14-1
SCHEDULE 5.15
EXISTING DEBT AND LIENS
1. 9% Convertible Subordinated Debentures due 2008 in the
outstanding principal amount of $20,552,000.
2. Notes due to Fleet Bank in the outstanding principal
amount of $4,320,459.12, secured by collateral as described in the
financial statements described in Schedule 5.5, which collateral
will be released upon the repayment of such Notes in accordance
with 10.3(b).
3. Secured Equipment Note due to GE Capital Corporation in
the outstanding principal amount of $6,250,000 and the related
letter of credit issued by Fleet Bank, in each case, secured by
collateral as described in the financial statements described in
Schedule 5.5, which collateral will be released upon the repayment
of such Secured Equipment Note in accordance with 10.3(b).
4. Debt owing to Aetna Life Insurance Company in the
outstanding principal amount of $1,011,213.24.
Schedule 5.15-1
EXHIBIT 1
FORM OF NOTE
THE ADVEST GROUP, INC.
7.95% SENIOR NOTE DUE DECEMBER 31, 2003
No. R-___ [Date]
$_______ PPN 007566 A* 3
FOR VALUE RECEIVED, the undersigned, THE ADVEST GROUP, INC.
(herein called the "Company"), a corporation organized and existing
under the laws of the State of Delaware, hereby promises to pay to
____________, or registered assigns, the principal sum of____________
DOLLARS ($_________) on December 31, 2003, with interest (computed on
the basis of a 360-day year of twelve 30-day months) (a) on the unpaid
balance thereof at the rate of 7.95% per annum from the date hereof,
payable semiannually on the last day of June and December in each year,
commencing with the June 30 or December 31 next succeeding the date
hereof, until the principal hereof shall have become due and payable,
and (b) to the extent permitted by law on any overdue payment
(including any overdue prepayment) of principal, any overdue payment of
interest and any overdue payment of any Make-Whole Amount (as defined
in the Note Purchase Agreements referred to below), payable
semiannually as aforesaid (or, at the option of the registered holder
hereof, on demand), at a rate per annum from time to time equal to the
greater of (i) 9.95% or (ii) 2% over the rate of interest publicly
announced from time to time by Xxxxxx Guaranty Trust Company of New
York in New York City (or its successor) as its "base" or "prime" rate.
Payments of principal of, interest on and any Make-Whole Amount
with respect to this Note are to be made in lawful money of the United
States of America at the address shown in the register maintained by
the Company for such purpose or at such other place as the Company
shall have designated by written notice to the holder of this Note as
provided in the Note Purchase Agreements referred to below.
This Note is one of a series of Senior Notes (herein called the
"Notes") issued pursuant to separate Note Purchase Agreements, dated as
of December 27, 1996 (as from time to time amended, the "Note Purchase
Agreements"), between the Company and the respective purchasers named
therein and is entitled to the benefits thereof. Each holder of this
Note will be deemed, by its acceptance hereof, (i) to have agreed to
the confidentiality provisions set forth in Section 20 of the Note
Purchase Agreements and (ii) to have made the representation set forth
in Section 6.2 of the Note Purchase Agreements.
This Note is a registered Note and, as provided in the Note
Purchase Agreements, upon surrender of this Note for registration of
transfer, duly endorsed, or accompanied by a written instrument of
transfer duly executed, by the registered holder hereof or such
holder's attorney duly authorized in writing, a new Note for a like
principal amount will be issued to, and registered in the name of, the
transferee. Prior to due presentment for registration of transfer, the
Company may treat the person in whose name this Note is registered as
the owner hereof for the purpose of receiving payment and for all other
purposes, and the Company will not be affected by any notice to the
contrary.
Exhibit 1-1
The Company will make required prepayments of principal on the
dates and in the amounts specified in the Note Purchase Agreements.
This Note is also subject to optional prepayment, in whole or from time
to time in part, at the times and on the terms specified in the Note
Purchase Agreements, but not otherwise.
If an Event of Default, as defined in the Note Purchase
Agreements, occurs and is continuing, the principal of this Note may be
declared or otherwise become due and payable in the manner, at the
price (including any applicable Make-Whole Amount) and with the effect
provided in the Note Purchase Agreements.
THIS NOTE AND THE NOTE PURCHASE AGREEMENTS ARE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
CONNECTICUT, EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH
STATE THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF A JURISDICTION
OTHER THAN SUCH STATE.
THE ADVEST GROUP, INC.
By_______________________________
Name:
Title:
Exhibit 1-2
EXHIBIT 4.4(a)
FORM OF OPINION OF COMPANY COUNSEL
DAY, XXXXX & XXXXXX
December 27, 1996
To the Persons Listed on
Schedule A hereto
Re: The Advest Group, Inc. (the "Company")
Ladies and Gentlemen:
Reference is made to the separate Note Purchase Agreements, dated
as of December 27, 1996 (collectively, the "Note Purchase Agreement"),
between the Company and each of the purchasers listed on Schedule A
attached thereto (the "Purchasers"), which provide, among other things,
for the issuance and sale by the Company of $35,000,000. The
capitalized terms used herein and not defined herein have the meanings
specified by the Note Purchase Agreement.
We have acted as special counsel to the Company and certain of its
Subsidiaries in connection with the transactions contemplated by Note
Purchase Agreement. In acting as such counsel, we have examined:
(a) the Note Purchase Agreement;
(b) the Company's 7.95% Senior Notes due December 31, 2003, dated
the date hereof, in the form of Exhibit 1 to the Note Purchase
Agreement, in the principal amount and with the registration numbers
set forth on Schedule A to the Note Purchase Agreement (the "Notes");
(c) The documents executed and delivered by the Company in
connection with the transactions contemplated by the Note Purchase
Agreement;
DAY, XXXXX & XXXXXX
December 27, 1996
Page 2
(d) the bylaws and records of proceedings of directors and
stockholders of the Company and a certified copy of the certificate of
incorporation of the Company, as in effect on the date hereof;
(e) a long-form good standing certificate from the state of
incorporation of the Company and good standing certificates from the
states of incorporation of Advest, Inc and Advest Bank;
(g) originals, or copies certified or otherwise identified to our
satisfaction, of such other documents, records, instruments and
certificates of public officials as we have deemed necessary or
appropriate to enable us to render this opinion.
In rendering our opinion, we have assumed that all signatures
(other than signatures of officers and directors of the Company) are
genuine, that all documents submitted to us as originals are genuine,
that all copies submitted to us conform to the originals, that all
natural Persons have legal capacity, and, as to documents executed by
or on behalf of Persons other than the Company,
(i) that each such Person executing documents had the power to
enter into and perform its obligations under such documents; and
(ii) that such documents have been duly authorized, executed and
delivered by, and are binding upon and enforceable against, such
Persons.
We have no actual knowledge of any information that would indicate
that our assumptions are invalid.
In rendering our opinion, we have relied, without independent
verification, to the extent we deem necessary and proper, on:
(a) warranties and representations as to certain factual matters
contained in the Note Purchase Agreement; and
DAY, XXXXX & XXXXXX
December 27, 1996
Page 3
(b) the Offeree Letter.
Based on the foregoing, we are of the following opinions:
1. Each of the Company, Advest, Inc., and Advest Bank is a
corporation duly incorporated, validly existing and in good standing
under the laws of its state of incorporation and has all requisite
corporate power and authority to carry on its business and own its
property.
2. The Company has the requisite corporate power and authority
to execute and deliver the Note Purchase Agreement, to issue and sell
the Notes, and to perform its obligations set forth in each of the Note
Purchase Agreement and the Notes.
3. Each of the Note Purchase Agreement and the Notes has been
duly authorized by all necessary corporate action on the part of the
Company (no action on the part of the stockholders of the company being
required in respect thereof), has been executed and delivered by duly
authorized officers of the Company, and constitutes a legal, valid and
binding obligation of the Company, enforceable against the Company in
accordance with its terms.
4. The execution and delivery of the Note Purchase Agreement and
the Notes, and the issue and sale of the Notes by the Company and the
performance by the Company of its obligations thereunder will not
conflict with, constitute a violation of, result in a breach of any
provision of, constitute a default under, or result in the creation or
imposition of any Lien or encumbrance upon any of its property or the
property of a Subsidiary pursuant to the certificate of incorporation
of bylaws of the Company, any applicable statute, rule or regulation to
which the Company, Advest, Inc. or Advest Bank is subject, or, to the
best of our knowledge after due inquiry, any agreement or instrument to
which the Company is party or by which its respective properties may be
bound.
5. All consents, approvals and authorizations of, and all
designations, declarations, filings, registrations, qualifications, and
recordations with, Governmental Authorities required on the part of the
Company, Advest, Inc., and Advest Bank have been obtained in connection
with the execution and delivery of the Note Purchase Agreement and the
issue and sale of the Notes and the use of the proceeds thereof.
DAY, XXXXX & XXXXXX
December 27, 1996
Page 4
6. Under existing law, the Notes are not required to be
registered under the Securities Act of 1933, as amended, and the
Company is not required to qualify an indenture with respect thereto
under the Trust Indenture Act of 1939, as amended.
7. Neither the issuance of the Notes nor the intended use of the
proceeds of the Notes (as set forth in Section 5.14 of the Note
Purchase Agreement) will violate Regulations G, T or X of the Federal
Reserve Board.
8. The Company
(a) is not an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, and
(b) is not a "holding company" or an "affiliate" of a
"holding company," or a "subsidiary company" of a "holding company," or
a "public utility" within the meaning of the Public Utility Company Act
of 1935, as amended.
All opinions herein contained with respect to the enforceability
of documents and instruments are qualified to the extent that:
(a) the availability of equitable remedies, including without
limitation, specified enforcement and injunctive relief, is subject to
the discretion of the court before which any proceedings therefor may
be brought; and
(b) the enforceability of certain terms provided in the Note
Purchase Agreement and the Note may be limited by
(i) applicable bankruptcy, reorganization, arrangement,
insolvency, moratorium, fraudulent conveyance or similar laws affecting
the enforcement of creditors' rights generally as at the time in
effect, and
(ii) general principles of equity and the discretion of a
court in granting equitable remedies (whether enforceability is
considered in a proceeding as law or in equity).
This opinion is delivered to you pursuant to Section 4.4(a) of the
Note Purchase Agreement. We express no opinion as to the law of any
jurisdiction other than the law of the State of Connecticut, the
General Corporation Law of the State of Delaware, and
DAY, XXXXX & XXXXXX
December 27, 1996
Page 5
federal law. Subsequent holders of the Notes may rely on this opinion
as if it were addressed to them. Xxxx & Xxxxxx may rely on this opinion
for the sole purpose of rendering their opinion to be rendered pursuant
to Section 4.4(c) of the Note Purchase Agreement.
Very truly yours.
/s/ Day, Xxxxx & Xxxxxx
DAY, XXXXX & XXXXXX
SCHEDULE A
Addressees
The Lincoln National Life Insurance Company
c/o Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
Allied Life Insurance Company
c/o Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
American States Life Insurance Company
c/o Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
Federal Warranty Service Corporation
c/o Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
First Penn-Pacific Life Insurance Company
c/o Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
Phoenix Home Life Mutual Insurance Company
c/o Phoenix Duff & Xxxxxx
00 Xxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000-0000
SunAmerica Life Insurance Company
c/o SunAmerica Corporate Finance
0 XxxXxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Anchor National Life Insurance Company
c/o SunAmerica Corporate Finance
0 XxxXxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
EXHIBIT 4.4(b)
FORM OF OPINION OF COMPANY GENERAL COUNSEL
Advest
December 27, 1996
To the Persons Listed on
Schedule A hereto
Re: The Advest Group, Inc. (the "Company")
Ladies and Gentlemen:
Reference is made to the separate Note Purchase Agreements, dated
as of December 27, 1996 (collectively, the "Note Purchase Agreement"),
between the Company and each of the purchasers listed on Schedule A
attached thereto (the "Purchasers"), which provide, among other things,
for the issuance and sale by the Company of is 7.95% Senior Notes due
December 31, 2003 in the aggregate principal amount of $35,000,000.
The capitalized terms used herein and not defined herein have the
meanings specified by the Note Purchase Agreement.
I am general counsel to the Company and in acting as such counsel,
I have examined:
(a) the Note Purchase Agreement;
(b) the Company's 7.95% Senior Notes due December 31, 2003, dated
the date hereof, in the form of Exhibit 1 to the Note Purchase
Agreement, in the principal amount and with the registration numbers
set forth on Schedule A to the Note Purchase Agreement (the "Notes");
(c) The documents executed and delivered by the Company in
connection with the transactions contemplated by the Note Purchase
Agreement;
(d) the bylaws and records of proceedings of directors and
stockholders of the Company and a certified copy of the certificate of
incorporation of the Company, as in effect on the date hereof; and
(e) originals, or copies certified or otherwise identified to my
satisfaction, of such other documents, records, instruments and
certificates of public officials as I have deemed necessary or
appropriate to enable us to render this opinion.
In rendering my opinion, I have assumed that all signatures (other
than signatures of officers and directors of the Company) are genuine,
that all documents submitted to me as originals are genuine, that all
copies submitted to me conform to the originals, that all natural
Persons have legal capacity, and, as to documents executed by or on
behalf of Persons other than the Company,
Advest
(i) that each such Person executing documents had the power to
enter into and perform its obligations under such documents, and
(ii) that such documents have been duly authorized, executed and
delivered by, and are binding upon and enforceable against, such
Persons.
I have no actual knowledge of any information that would indicate
that my assumptions are invalid.
Based on the foregoing, I am of the following opinions:
1. Advest, Inc., the only Broker-Dealer Subsidiary, is a member
firm in good standing of the NYSE and the NASD and is registered as a
broker-dealer with the SEC.
2. Advest, Inc. has registered as a broker-dealer or investment
adviser in each jurisdiction where the nature of its activities makes
such registration necessary, except where the failure to so register
would not have a Material Adverse Effect.
3. All consents, approvals and authorizations of, and all
designations, declarations, filings, registrations, qualifications, or
recordations with, Governmental Authorities required on the part of
each of the Company and each Subsidiary have been obtained in
connection with the part of each of the Company and each Subsidiary
have been obtained in connection with the ownership of its properties
and the conduct of its businesses, except where the failure to obtain
any such consent, approval or authorization with respect to such
ownership and conduct would not have a Material Adverse Effect.
4. There is no default or existing condition which with the
passage of time or notice, or both, would result in a default by the
Company or any Subsidiary under any contract, lease or commitment known
to me to which any one or more of the Company or any Subsidiary is a
party or by which their respective properties may be bound, except
where such default would not have a material adverse effect on the
ability of the Company to perform its obligations set forth in the Note
Purchase Agreement and the Notes.
5. To the best of my knowledge, after inquiry of other officers
of the Company, there is no judgment, order, action, suit, proceeding,
inquiry, order or investigation, at law or in equity, before any court
or Governmental Authority, arbitration board or tribunal, pending or
threatened against the Company or any one or more of the Subsidiaries,
except for any such judgment, order, action, suit, proceeding, inquiry,
order or investigation that would not have a Material Adverse Effect.
6. To the best of my knowledge, after due inquiry, the Company
has good title to all of the shares it purports to own of the capital
stock of each Subsidiary, free and clear in each case of any perfected
security interest, and to the best of my knowledge after due inquiry,
any other Lien, except that the capital stock of Advest Bank has been
pledged to Fleet Bank, such capital stock shall
2
Advest
be released upon the payment of the obligations owing the Fleet bank in
accordance with the requirements of Section 10.3(b) of the Note
Purchase Agreement.
This opinion is delivered to you pursuant to Section 4.4(b) of the
Note Purchase Agreement. I express no opinion as to the law of any
jurisdiction other than the law of the State of Connecticut and federal
law. Subsequent holders of the Notes may rely on this opinion as if it
were addressed to them. Xxxx & Xxxxxx may rely on this opinion for the
sole purpose of rendering their opinion to be rendered pursuant to
Section 4.4(c) of the Note Purchase Agreement.
Very truly yours.
/s/Xxx X. Xxxxxx
Xxx X. Xxxxxx
3
SCHEDULE A
Addressees
The Lincoln National Life Insurance Company
c/o Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
Allied Life Insurance Company
c/o Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
American States Life Insurance Company
c/o Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
Federal Warranty Service Corporation
c/o Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
First Penn-Pacific Life Insurance Company
c/o Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
Phoenix Home Life Mutual Insurance Company
c/o Phoenix Duff & Xxxxxx
00 Xxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000-0000
SunAmerica Life Insurance Company
c/o SunAmerica Corporate Finance
0 XxxXxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Anchor National Life Insurance Company
c/o SunAmerica Corporate Finance
0 XxxXxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
EXHIBIT 4.4(c)
FORM OF OPINION OF SPECIAL COUNSEL TO PURCHASERS
XXXX & XXXXXX
December 27, 1996
To each of the Persons
listed on Annex 1 hereto
Re: The Advest Group, Inc.
Ladies and Gentlemen:
Reference is made to the separate Note Purchase Agreements, each
dated as of December 27, 1996 (collectively, the "Note Purchase
Agreement"), between the Advest Group, Inc.(the "Company"), a Delaware
corporation, and each of the purchasers listed on Schedule A attached
thereto (the "Purchasers"), which provide, among other things, for the
issuance and sale by the Company of its 7.95% Senior Notes due December
31, 2003, in the aggregate principal amount of Thirty-five Million
Dollars ($35,000,000). Capitalized terms used in this opinion and not
defined herein have the respective meanings ascribed to them in, or
pursuant to the provisions of, the Note Purchase Agreement.
We have acted as special counsel to you in connection with the
transactions contemplated by Note Purchase Agreement. This opinion is
delivered to you pursuant to Section 4.4(c) of the Note Purchase
Agreement. In acting as such counsel, we have examined:
(a) the Note Purchase Agreement;
(b) the Company's 7.95% Senior Notes due December 31, 2003, each
dated the date hereof, in the form of Exhibit 1 to the Note Purchase
Agreement and registered in the names, in the principal amounts and
with the registration numbers as set forth on Schedule A to the Note
Purchase Agreement (collectively, the "Notes");
(c) a certificate of Officers of the Company;
(d) a certificate of the Secretary of the Company, attaching
copies certified to be true, of:
(i) resolutions authorizing participation by the Company in
the transactions contemplated by the Note Purchase Agreement and
the Notes;
(ii) the bylaws of the Company; and
XXXX & XXXXXX
To each of the Persons
listed on Annex 1 hereto
December 27, 1996
Page 2
(iii) a copy of the certificate of incorporation of the
Company, certified by the Secretary of State of the State of
Delaware;
(e) a long-form good standing certificate from the jurisdiction
of incorporation of the Company;
(f) a letter to Xxxx & Xxxxxx from each of Ironwood Capital
Partners, Ltd. and Advest, Inc. describing the manner of the offering
of the Notes (collectively, the "Offeree Letter");
(g) the opinion of Day, Xxxxx & Xxxxxx, special counsel to the
Company, dated the date hereof;
(h) the opinion of Xxx X. Xxxxxx, General Counsel of the Company,
dated the date hereof; and
(i) originals, or copies certified or otherwise identified to our
satisfaction, of such other documents, records, instruments and
certificates of public officials as we have deemed necessary or
appropriate to enable us to render this opinion.
In rendering our opinion, we have assumed that all signatures are
genuine, that all documents submitted to us as originals are genuine,
that all copies submitted to us conform to the originals, that all
natural Persons have legal capacity and, as to documents executed by or
on behalf of Persons other than the Company that each such Person
executing documents had the power to enter into and perform its
obligations under such documents and that such documents have been duly
authorized, executed and delivered by, and are binding upon and
enforceable against, such Persons.
In rendering our opinion, we have relied, to the extent we deem
necessary and proper, on:
(i) warranties and representations as to certain factual
matters contained in the Note Purchase Agreement; and
(ii) the Offeree Letter; and
(iii) said opinions of Day, Xxxxx & Xxxxxx and Xxx X. Xxxxxx
with respect to the due incorporation, valid existence, good
standing and corporate power and authority of, and the
authorization, execution and delivery of documents by, the Company
(except that we have reviewed the copy of the certificate of the
Secretary of the Company, and the attachments thereto, referred to
above), and our conclusions as to such matters are subject to the
same assumptions and qualifications as are contained in such
opinions; based on such
XXXX & XXXXXX
To each of the Persons
listed on Annex 1 hereto
December 27, 1996
Page 3
investigation as we have deemed appropriate, said opinions are
satisfactory in form and scope to us, and, in our opinion, you and
we are justified in relying thereon.
Based on the foregoing, we are of the following opinions:
1. The Company is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware.
2. The Company has the requisite corporate power and authority
to execute and deliver each of the Note Purchase Agreement and the
Notes and to perform its obligations set forth therein. The Company has
the requisite corporate power and authority to offer, issue and sell
the Notes in accordance with the provisions of the Note Purchase
Agreement.
3. Each of the Note Purchase Agreement and the Notes has been
duly authorized by all necessary corporate action on the part of the
Company, has been executed and delivered by duly authorized officers of
the Company and constitutes a legal, valid and binding obligation of
the Company, enforceable against the Company in accordance with its
terms.
4. The execution and delivery by the Company of the Note
Purchase Agreement and the Notes, and the issue and sale of the Notes
by the Company and the performance by the Company of its obligations
under the Note Purchase Agreement and the Notes will not conflict with,
constitute a violation of, result in a breach of any provision of,
constitute a default under, or result in the creation or imposition of
any Lien (other than the Liens permitted by the Note Purchase
Agreement) upon any of their respective Properties pursuant to, the
certificate of incorporation or bylaws of the Company.
5. No consent, approval and authorization of any governmental
authority of the United States of America or of the State of
Connecticut is required under the laws of the United States of America
or the State of Connecticut in connection with the execution and
delivery of the Note Purchase Agreement and the Notes and the offer,
issue and sale of the Notes. Our opinion in this paragraph 5 is based
solely on a review of generally applicable laws of the United States of
America and the State of Connecticut and not on any search with respect
to, or review of, any orders, decrees, judgments or other
determinations specifically applicable to the Company.
6. Under existing law:
(a) the offering and sale of the Notes under the
circumstances contemplated by the Note Purchase Agreement is not
subject to the registration requirements under the Securities Act;
and
(b) the Company is not required to qualify an indenture with
respect to the Notes under the Trust Indenture Act of 1939, as
amended.
XXXX & XXXXXX
To each of the Persons
listed on Annex 1 hereto
December 27, 1996
Page 4
All opinions herein contained with respect to the enforceability
of documents and instruments are qualified to the extent that:
(a) the availability of equitable remedies, including, without
limitation, specific enforcement and injunctive relief, is subject to
the discretion of the court before which any proceedings therefor may
be brought; and
(b) the enforceability of certain terms provided in the Note
Purchase Agreement and the Note may be limited by applicable
bankruptcy, reorganization, arrangement, insolvency, moratorium,
fraudulent conveyance or similar laws affecting the enforcement of
creditors' rights generally as at the time in effect, common law or
statutory requirements with respect to commercial reasonableness, and
general principles of equity.
Other than in reliance upon the aforementioned opinions of Day,
Xxxxx & Xxxxxx and Xxx X. Xxxxxx, we express no opinion as to the law
of any jurisdiction other than the federal law of the United States of
America and the laws of the State of Connecticut
Subsequent holders of the Notes may rely on this opinion as if it
were addressed to them.
Very truly yours.
/s/ Xxxx & Xxxxxx
ANNEX 1
Addressees
The Lincoln National Life Insurance Company
c/o Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
Allied Life Insurance Company
c/o Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
American States Life Insurance Company
c/o Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
Federal Warranty Service Corporation
c/o Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
First Penn-Pacific Life Insurance Company
c/o Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx; Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
Phoenix Home Life Mutual Insurance Company
c/o Phoenix Duff & Xxxxxx
00 Xxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000-0000
SunAmerica Life Insurance Company
c/o SunAmerica Corporate Finance
0 XxxXxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Anchor National Life Insurance Company
c/o SunAmerica Corporate Finance
0 XxxXxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
