BOND PURCHASE AGREEMENT
Exhibit 10.31
THIS BOND PURCHASE AGREEMENT, dated as of September 1, 2002, by and among THE INDUSTRIAL
DEVELOPMENT AUTHORITY OF ST. XXXXXXX COUNTY, MISSOURI, a public corporation organized under the
laws of the State of Missouri (the “Issuer”), UNION PLANTERS BANK, N.A., St. Louis, Missouri, a
national banking association (the “Purchaser”) and SYNERGETICS DEVELOPMENT COMPANY, L.L.C., a
limited liability company organized under the laws of the State of Missouri (the “Obligor”).
W I T N E S S E T H:
ARTICLE I
COVENANTS
The Issuer covenants that:
SECTION 1.1. Authority. To its knowledge, the covenants of the Issuer contained in the Loan
Agreement (the “Agreement”) dated as of even date herewith between the Issuer and the Obligor are
true and correct. The execution and delivery of this Bond Purchase Agreement, the Indenture of
Trust, dated as of even date herewith (“Indenture”), by and between the Issuer and UMB Bank, N.A.,
as Trustee (“Trustee”), the aggregate principal amount of $2,645,000 Private Activity Revenue
Bonds, Series 2002 (Synergetics Development Company Project) issued pursuant to the Indenture (the
“Bonds”), the Assignment, dated as of even date herewith, by and between the Issuer and the Trustee
(the “Assignment”), the Tax Compliance Agreement dated as of even date herewith among the Issuer,
the Obligor and the Trustee (the “Tax Compliance Agreement”) and the Agreement and the acceptance
of the Future Advance Deed of Trust and the Security Agreement, dated as of even date herewith,
executed by the Obligor as Grantor to the mortgage trustee named therein for the benefit of the
Issuer (the “Deed of Trust”), the Assignment of Leases (the “Assignment of Leases”) executed by the
Obligor, the Guaranty Agreement, dated as of even date herewith, executed by Xxxxxxx X. Xxxxx,
Xxxxx X. Xxxxxxxx, Xxxx X. Xxxxx and Synergetics, Inc. (collectively, the “Guarantor”) for the
benefit of the Issuer (the “Guaranty”), the Security Agreement (Equipment) (the “Security
Agreement”) executed by Synergetics, Inc. (the “Security Agreement”), the Guaranty of Unassigned
Issuer’s Rights, dated as of even date herewith executed by the Guarantor and the Obligor for the
benefit of the Issuer (the “Guaranty of Unassigned Issuer’s Rights” and hereinafter, together with
the Deed of Trust, the Assignment of Leases, the Guaranty and the Security Agreement, the
“Collateral Documents”) are within its authority and have been duly authorized by proper
proceedings and, to its knowledge, will not contravene its articles of incorporation or by-laws or
any judgment, action, decree, agreement or instrument to which it is a party. Execution of the
Indenture, the Bonds, the Agreement, the Assignment. the Tax Compliance Agreement and this Bond
Purchase Agreement has been authorized by the Issuer.
SECTION 1.2. Use of Proceeds. The proceeds of the sale of the Bonds will be deposited in the
Project Fund created by the Indenture (the “Project Fund”) and used as provided in the Agreement
and the Indenture. The proceeds of the sale of the Bonds to be issued pursuant to the Indenture
will not be used for any purpose other than as provided in the Agreement and the Indenture.
SECTION 1.3. Litigation and Governmental Authorization. To its knowledge, there is no action
or proceeding pending or threatened by or against the Issuer before any court or administrative
agency which might adversely affect the authority or ability of the Issuer to perform its
obligations under the Agreement, the Indenture, the Collateral Documents, this Bond Purchase
Agreement or the Bonds, or any related documents. To its knowledge, all authorizations, consents
and approvals of governmental bodies or agencies applicable to Issuer required by the Act in
connection with the execution and delivery
by the Issuer of the Agreement, the Indenture, the Collateral Documents, this Bond Purchase
Agreement and the Bonds or in connection with the carrying out by Issuer of its obligations under
the Agreement, the Indenture, the Collateral Documents, this Bond Purchase Agreement or the Bonds
have been obtained.
ARTICLE II
OBLIGOR’S REPRESENTATIONS AND WARRANTIES
The Obligor represents and warrants that:
SECTION 2.1. Existence. The Obligor has been duly organized and is validly existing as a
limited liability company under the laws of the State of Missouri with full power and authority to
own its properties and conduct its business as contemplated by the Agreement and is conducting its
business in substantial compliance with all applicable and valid laws, rules and regulations of
each jurisdiction where it owns or leases substantial property or where it transacts material
intrastate business.
SECTION 2.2. Authority. The Obligor has full corporate power and authority to execute and
deliver the Agreement, the Promissory Note dated as of even date herewith pursuant to the Agreement
(the “Note”), the Collateral Documents to which it is a party and this Bond Purchase Agreement and
to carry out the terms thereof on its part to be performed. This Bond Purchase Agreement, the
Agreement, the Collateral Documents to which it is a party and the Note, when executed and
delivered by the Obligor, will be in full force and effect and will be valid and binding
obligations of the Obligor, enforceable in accordance with their terms. The consummation of the
transactions herein described and the carrying out of the terms thereof will not result in a
violation of any provision of, or a default under, the Articles of Association or Operating
Agreement of the Obligor or any indenture, mortgage, deed of trust, indebtedness or agreement,
judgment or decree to which the Obligor is now a party or by which the Obligor or its property is
now bound.
SECTION 2.3. Authorization and Absence of Defaults. All consents, approvals, authorizations
and other requirements prescribed by any law, governmental rule or regulation applicable to the
Obligor which must be obtained or satisfied by the Obligor in connection with the transactions
described herein have been obtained and satisfied. The Obligor is not in violation of any
provision of its Articles of Association or Operating Agreement and the Obligor is not in violation
of any provision of, or in default under, any indenture, mortgage, deed of trust, indebtedness,
agreement, instrument, judgment, decree, order, statute, rule or regulation to which it is a party
or by which it or its property is bound. There is no action, suit, proceeding, inquiry or
investigation at law or in equity before or by any judicial or administrative court or agency
pending or, to the best knowledge of the Obligor, threatened, against the Obligor, to which the
Obligor is or may become a party or to which any of its property is or may become subject wherein
an unfavorable decision, ruling or finding would adversely affect the validity or enforceability of
the Indenture, the Agreement, the Note, the Collateral Documents to which it is a party, this Bond
Purchase Agreement or the transactions described herein or therein, or the validity of the Bonds,
or that should have a material adverse effect on the financial condition or operations of the
Obligor. The obligations of the Obligor under the Agreement, the Collateral Documents to which it
is a party and the Note are not subordinate to the rights of those claiming by, under or through
any indentures, loan agreements or other instruments to which the Obligor is a party or by which
the Obligor is or may be bound pursuant to the terms thereof, except as identified in said
documents.
SECTION 2.4. Tax-Exempt Status. The information supplied by the Obligor in writing with
respect to the tax-free status of the Bonds for use by Bond Counsel including all certificates
executed in connection with the issuance of the Bonds and so identified therein is correct and
complete in all material respects.
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ARTICLE III
THE BONDS
SECTION 3.1. Issuance of Bonds. The Purchaser agrees, upon the terms and subject to the
conditions contained in this Bond Purchase Agreement, to purchase from the Issuer, and the Issuer
agrees to issue and sell to the Purchaser, the Bonds in the principal amount of $2,645,000 at a
purchase price equal to the principal amount of the Bonds, which purchase price shall be paid in
immediately available funds. The purchase price shall be paid by the Purchaser to the Trustee
under the Indenture who shall credit such amount to the Project Fund and such payment shall be
evidenced to the Issuer by a written receipt of the Purchaser. The Bonds sold hereunder shall be
designated “Private Activity Revenue Bonds, Series 2002 (Synergetics Development Company Project)”
and shall be dated their date of issuance and shall be substantially in the form set forth in, and
subject to the terms and provisions of, the Indenture.
SECTION 3.2. Closing. The purchase of the Bonds shall occur on September 26, 2002, at 10:00
a.m. at the offices of Xxxxxxx & Xxxx, P.C., One Metropolitan Square, Suite 2350, 000 X. Xxxxxxxx,
Xx. Xxxxx, Xxxxxxxx, or at such other place, at such time, and on such date as the Issuer and the
Purchaser shall mutually agree (the “Closing”).
SECTION 3.3. Conditions of Purchase of the Bonds. The obligation of the Purchaser to
purchase the Bonds hereunder is conditioned upon:
(1) receipt by the Purchaser of three business days’ notice from the Issuer of the proposed
date and time of purchase if different than as set forth above;
(2) at the conclusion of such sale and after the application of any proceeds therefrom no
event of default specified in the Agreement, the Collateral Documents or the Indenture and no event
which, with the giving of notice or lapse of time or both, would become such an event of default
shall have occurred and be continuing;
(3) (i) the covenants of the Issuer contained or referred to in Section 1 hereof; (ii)
the representations and warranties of the Obligor in the Agreement and the Collateral Documents to
which it is a party; and (iii) the representations and warranties of the Guarantor in the Guaranty
being true and correct;
(4) receipt by the Purchaser of the Bonds;
(5) receipt by the Purchaser of fully executed copies of this Bond Purchase Agreement, the
Agreement, the Collateral Documents, the Note, duly endorsed to the Trustee and the other closing
documents;
(6) receipt by the Purchaser of an opinion of Xxxxxxx & Xxxx, P.C., as Bond Counsel, in form
and substance satisfactory to the Issuer and the Purchaser;
(7) receipt by the Purchaser of an opinion of counsel for the Issuer, an opinion of counsel
for Obligor, each dated the date of Closing in form and substance satisfactory to the Issuer, the
Purchaser and to Xxxxxxx & Xxxx, P.C., Bond Counsel;
(8) receipt by the Purchaser of the Tax Compliance Agreement in form and substance
satisfactory to the Issuer, the Purchaser and to Xxxxxxx & Xxxx, P.C., Bond Counsel;
(9) receipt by the Purchaser of evidence that title to the real property encumbered by the
Deed of Trust located in the County of St. Xxxxxxx, Missouri and more particularly described in the
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Deed of Trust is vested in the Obligor, and specifically, receipt of a title commitment for ALTA
Loan Policy (Form 1970) in the amount of $2,645,000; at Closing, the title insurance company must
issue the required policy with all standard exceptions deleted, no other exceptions not previously
approved by Purchaser and with such affirmative coverages as Purchaser shall require, including,
without limitation, zoning endorsement (ALTA Form 3.0), comprehensive endorsement (CLTA Form 100),
future advances and survey endorsements, and satisfactory mechanic’s lien coverage including, at a
minimum, monthly endorsements insuring against mechanic’s liens arising from nonpayment of bills
for labor performed or materials furnished prior to the date of the most recent sworn contractor’s
statement;
(10) receipt by the Purchaser of evidence of the existence and good standing in the State of
Missouri of the Issuer and the Obligor;
(11) organizational documents and authorizing resolutions of the Obligor and the Corporate
Guarantor, including articles of association, operating agreement, member resolutions, articles of
incorporation, by-laws and board resolutions, together any fictitious name registration; the
Obligor shall furnish or cause to be furnished to the Purchaser such certificates, resolutions, and
other documents necessary to evidence the authority of the person or persons signing the Agreement,
the Note and the Collateral Documents on behalf of the Obligor and the Corporate Guarantor to
execute such documents and consummate the transactions herein contemplated;
(12) policies or certificates for the insurance required by Section 5.5 of the Agreement;
(13) survey satisfying title insurer, showing the improvements thereon as of a date not more
than three months prior to the date of issuance of the Bonds made by a registered civil engineer or
surveyor licensed in Missouri, in accordance with the standard detail requirements for land title
surveys adopted by ATA and ACSM, as revised and in effect on the date of the survey, which survey
shall be certified to as being accurate by the surveyor, said certification running to the Obligor,
the Trustee, title company and the Purchaser, and it shall show no encroachments on such land by
adjoining structures and no encroachments upon adjoining premises by the buildings and improvements
erected and installed upon said land, showing ingress and egress to and from public rights-of-way
to the land, showing all easements, showing the location of the Project and showing a legal
description of the land and the location of adjacent streets or otherwise in form and substance
satisfactory to Purchaser;
(14) flood plain certification by a surveyor or engineer; if any portion of the Project is in
a flood plain, satisfactory flood insurance coverage shall be required naming the Trustee as
insured;
(15) an appraisal of the Project prepared by an independent, qualified appraiser acceptable to
Purchaser;
(16) receipt by the Purchaser of Uniform Commercial Code search requests, as of a date not
more than one month prior to Closing, with respect to the Obligor in all jurisdictions as the
Purchaser may request, which shall show no filings with respect to the Obligor except those
acceptable to the Purchaser;
(17) receipt by the Purchaser of the final plans and specifications for the Project.
(18) such additional items as the Purchaser or its counsel may reasonably require;
(19) the Obligor shall pay, without limitation, all costs and expenses incurred by the
Purchaser in connection with the purchase of the Bonds and the disbursement of the proceeds
thereof, including but not limited to legal expenses, title insurance premiums, the fees of the
Purchaser’s disbursing
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agent and/or disbursement advisor, survey, recording and filing fees, mortgage registration tax,
and any other type of mortgage tax, if any; and
(20) a requisition duly executed by the Authorized Obligor Representative requesting payment
of the issuance fee and counsel fees charged by the Issuer shall have been delivered to the
Trustee.
The receipt by or on behalf of the Issuer of payment by the Purchaser of the purchase price of the
Bonds under Section 3.1 shall be deemed to be a covenant by the Issuer as of the date of
such receipt as to the facts specified in (2) and (3) above.
ARTICLE IV
COVENANTS
SECTION 4.1. Reaffirmation. The Issuer reaffirms to the Purchaser its covenants and
agreements contained in the Agreement as being true and correct as of the Closing.
SECTION 4.2. Purchaser Representations. The Purchaser acknowledges that in purchasing the
Bonds it is not relying on any representations of the Issuer with respect to the financial quality
of the Bonds. The Purchaser is relying solely on statements and representations of the Obligor,
and on its own knowledge and investigation of the facts and circumstances relating to the purchase
of the Bonds.
SECTION 4.3. No Registration. The Purchaser understands that the Bonds have not been
registered under the Securities Act of 1933, as amended, and that such registration is not legally
required. The Purchaser is purchasing the Bonds for its own account for investment and has no
present intention of distributing or selling such Bonds or any portion thereof or any interest
therein, but expressly reserves the right to sell the Bonds or sell participations in the Bonds.
SECTION 4.4. Sophisticated Investor. The Purchaser acknowledges that its business is that of
a commercial bank having substantial assets. In connection with its business, the Purchaser holds
an extensive portfolio of investments and other securities. The Purchaser has knowledge and
experience in financial and business matters and is capable of evaluating the merits and risks of
purchasing the Bonds and is not relying on any information supplied or representations or
warranties made by the Issuer with respect to the Obligor or the Project.
SECTION 4.5. Access to Information. The Purchaser covenants that it is familiar with the
business and properties of the Obligor. The Purchaser has had access to the same kind of
information that is specified in Schedule A of the Securities Act of 1933, relative to the business
of the Obligor to the extent that the Obligor possesses such information or can acquire it without
unreasonable effort or expense. The Issuer and the Obligor have made available, during the course
of the transaction and prior to the purchase of the Bonds, to the Purchaser, the opportunity to ask
questions and receive answers from such parties concerning the terms and conditions of the Bond
offering and to obtain any additional information relative to the financial data and business of
such parties and the property to be mortgaged to the extent that such parties possess such
information or can acquire it without unreasonable effort or expense.
SECTION 4.6. Documents. The Agreement, the Collateral Documents, the Note, the Indenture,
and this Bond Purchase Agreement, as finally executed, contain terms and are in form acceptable to
the Purchaser.
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SECTION 4.7. Reliance. The Issuer and the Purchaser agree that the Obligor is entitled to
rely on their respective covenants and representations contained in this Bond Purchase Agreement.
ARTICLE V
MISCELLANEOUS
SECTION 5.1. Limitation. Anything in this Bond Purchase Agreement to the contrary
notwithstanding, no director or officer of the Issuer shall be personally liable on this Bond
Purchase Agreement or any contract or obligation executed pursuant hereto.
SECTION 5.2. Notices. All notices, demands or other communications hereunder shall be in
writing and shall be deemed to have been given when the same are (i) deposited in the United States
mail and sent by first class mail, postage prepaid, or (ii) delivered, in each case, to the parties
at the addresses set forth below or at such other address as a party may designate by notice to the
other parties: (a) if to the Issuer, at 0000 Xxx Xxxxxx Xxxx Xxxxx, Xx. Xxxxxxx, Xxxxxxxx 00000,
Attention: President; and (b) if to the Purchaser, at 0000 Xxxxxxxx Xxxxxx, Xxxxx 000, Xx. Xxxxx,
Xxxxxxxx 00000, Attention: Xxxx Xxxxxxxxx. A copy of all such notices, demands or other
communications hereunder shall be mailed to the Obligor at 00 Xxxxxx Xxxxx, X’Xxxxxx, Xxxxxxxx
00000, Attention: Xxxx X. Xxxxx, Xx.
SECTION 5.3. Term of Agreement. The term of this Agreement shall be until the termination of
the Purchaser’s obligation to purchase the Bonds hereunder or until the payment in full of the
Bonds and any other amounts due to the Purchaser under the Note, the Collateral Documents and the
Agreement, whichever is later.
SECTION 5.4. Copies of Certificates, Etc. Whenever the Issuer is required to deliver
notices, certificates, opinions, statements or other information hereunder to the Purchaser, it
shall do so in such number of copies as the Purchaser shall reasonably specify.
SECTION 5.5. No Waivers. No failure or delay by the Purchaser in exercising any right, power
or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise
thereof preclude any other or further exercise thereof or the exercise of any other right, power or
privilege.
SECTION 5.6. Governing Law. This Bond Purchase Agreement and the Bonds shall be deemed to be
a contract made under and shall be construed in accordance with and governed by the laws of the
State of Missouri.
SECTION 5.7. Changes, Waivers, Etc. Neither this Bond Purchase Agreement nor any provision
hereof may be changed, waived, discharged or terminated orally, except by a statement in writing
signed by each party against which enforcement of this change, waiver, discharge or termination is
sought.
SECTION 5.8. Counterparts. This Bond Purchase Agreement may be signed in any number of
counterparts with the same effect as if the signatures thereto and hereto were upon the same
instrument. Complete sets of counterparts shall be lodged with the Issuer and the Purchaser.
SECTION 5.9. Other Terms. Terms defined in the Indenture and not otherwise defined herein
shall have the meanings herein as prescribed for them in the Indenture.
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| THE INDUSTRIAL DEVELOPMENT AUTHORITY OF ST. XXXXXXX COUNTY, MISSOURI |
||||
| By | /s/ | |||
| President | ||||
| UNION PLANTERS BANK, N.A. |
||||
| By | /s/ | |||
| Title: Vice President | ||||
| SYNERGETICS DEVELOPMENT COMPANY, L.L.C. |
||||
| By | /s/ Xxxx X. Xxxxx, MANAGER | |||
| Manager | ||||
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