Xxxxxxx Worldwide Associates, Inc.
Note Agreement
Dated as of October 1, 1995
Re: $30,000,000 7.77% Senior Notes, Series A
Due October 15, 2005
and
$15,000,000 6.98% Senior Notes, Series B
Due October 15, 2005
Table of Contents
Section Heading Page
Section 1. Description of Notes and Commitment . . . . . . . . . 1
Section 1.1. Description of Notes . . . . . . . . . . . . . . 1
Section 1.2. Commitment, Closing Date . . . . . . . . . . . . 2
Section 1.3. Several Commitments . . . . . . . . . . . . . . . 2
Section 2. Prepayment of Notes . . . . . . . . . . . . . . . . . 2
Section 2.1. Required Prepayments . . . . . . . . . . . . . . 2
Section 2.2. Optional Prepayments of Notes . . . . . . . . . . 4
Section 2.3. Prepayment of Notes upon Change of Control . . . 4
Section 2.4. Notice of Optional Prepayments . . . . . . . . . 5
Section 2.5. Allocation of Prepayments . . . . . . . . . . . . 6
Section 2.6. Direct Payment . . . . . . . . . . . . . . . . . 6
Section 3. Representations . . . . . . . . . . . . . . . . . . . 6
Section 3.1. Representations of the Company . . . . . . . . . 6
Section 3.2. Representations of the Purchasers . . . . . . . . 7
Section 4. Closing Conditions . . . . . . . . . . . . . . . . . . 7
Section 4.1. Closing Certificate . . . . . . . . . . . . . . . 7
Section 4.2. Legal Opinions . . . . . . . . . . . . . . . . . 7
Section 4.3. Company's Existence and Authority . . . . . . . . 7
Section 4.4. Consent of Holders of Other Securities . . . . . 7
Section 4.5. Legality of Investment . . . . . . . . . . . . . 8
Section 4.6. Related Transactions . . . . . . . . . . . . . . 8
Section 4.7. Satisfactory Proceedings . . . . . . . . . . . . 8
Section 4.8. Waiver of Conditions . . . . . . . . . . . . . . 8
Section 4.9. Private Placement Numbers . . . . . . . . . . . . 8
Section 4.10. Payment of Closing Costs . . . . . . . . . . . . 8
Section 5. Company Covenants . . . . . . . . . . . . . . . . . . 9
Section 5.1. Corporate Existence, Etc . . . . . . . . . . . . 9
Section 5.2. Insurance . . . . . . . . . . . . . . . . . . . . 9
Section 5.3. Taxes, Claims for Labor and Materials,
Compliance with Laws . . . . . . . . . . . . . . 9
Section 5.4. Maintenance, Etc . . . . . . . . . . . . . . . . 10
Section 5.5. Nature of Business . . . . . . . . . . . . . . . 10
Section 5.6. Limitations on Indebtedness . . . . . . . . . . . 10
Section 5.7. Limitation on Liens . . . . . . . . . . . . . . . 11
Section 5.8. Mergers Consolidations, Sales of Assets, Etc . . 13
Section 5.9. Consolidated Tangible Net Worth . . . . . . . . . 17
Section 5.10. Distributions . . . . . . . . . . . . . . . . . . 17
Section 5.11. Investments . . . . . . . . . . . . . . . . . . . 18
Section 5.12. Repurchase of Notes . . . . . . . . . . . . . . . 20
Section 5.13. Transactions with Affiliates . . . . . . . . . . 20
Section 5.14. ERISA Compliance . . . . . . . . . . . . . . . . 20
Section 5.15. Reports and Rights of Inspection . . . . . . . . 21
Section 6. Events of Default and Remedies Therefor . . . . . . . 24
Section 6.1 Events of Default . . . . . . . . . . . . . . . . 24
Section 6.2. Notice to Holders . . . . . . . . . . . . . . . . 26
Section 6.3 Acceleration of Maturities . . . . . . . . . . . 26
Section 6.4 Rescission of Acceleration . . . . . . . . . . . 27
Section 7. Amendments, Waivers And Consents . . . . . . . . . . . . 27
Section 7.1. Consent Required . . . . . . . . . . . . . . . . 27
Section 7.2. Effect of Amendment or Waiver . . . . . . . . . . 27
Section 7.3 Solicitation of Holders . . . . . . . . . . . . . 28
Section 8. Interpretation of Agreement; Definitions . . . . . . . . 28
Section 8.1. Definitions . . . . . . . . . . . . . . . . . . . 28
Section 8.2. Accounting Principles . . . . . . . . . . . . . . 35
Section 8.3. Directly or Indirectly . . . . . . . . . . . . . 36
Section 9. Miscellaneous . . . . . . . . . . . . . . . . . . . . 36
Section 9.1. Registration of Notes . . . . . . . . . . . . . . 36
Section 9.2. Exchange of Notes . . . . . . . . . . . . . . . . 36
Section 9.3. Loss, Theft, Etc. of Notes . . . . . . . . . . . 36
Section 9.4. Expenses, Stamp Tax Indemnity . . . . . . . . . . 37
Section 9.5. Powers and Rights Not Waived; Remedies Cumulative 37
Section 9.6. Notices . . . . . . . . . . . . . . . . . . . . . 37
Section 9.7. Successors and Assigns . . . . . . . . . . . . . 38
Section 9.8. Survival of Covenants and Representations . . . . 38
Section 9.9. Severability . . . . . . . . . . . . . . . . . . 38
Section 9.10. Reproduction of Documents . . . . . . . . . . . . 38
Section 9.11. Governing Law . . . . . . . . . . . . . . . . . . 38
Section 9.12. Submission of Jurisdiction; Waiver of Jury Trial 39
Section 9.13. Captions . . . . . . . . . . . . . . . . . . . . 39
Attachments to Note Agreement:
Schedule I - Name and Addresses of Purchasers
Schedule II - Description of Subsidiaries and Indebtedness of the
Company and its Restricted Subsidiaries
Exhibit A-1 - Form of 7.77% Senior Note
Exhibit A-2 - Form of 6.98% Senior Note
Exhibit B - Closing Certificate of the Company
Exhibit C - Description of Closing Opinion of Special Counsel
Exhibit D - Description of Closing Opinion of Independent Counsel
to Company
Xxxxxxx Worldwide Associates, Inc.
0000 Xxxxxx Xxxx
X.X. Xxx 000
Xxxxxxxxxx, Xxxxxxxxx 00000
Note Agreement
Re: $30,000,000 7.77% Senior Notes, Series A
Due October 15, 2005
and
$15,000,000 6.98% Senior Notes, Series B
Due October 15, 2005
Dated as of October 1, 1995
To the Purchasers Named in
Schedule I hereto which are
signatories to this Agreement
Gentlemen:
The undersigned, Xxxxxxx Worldwide Associates, Inc., a Wisconsin
corporation, its successors and assigns (the "Company"), agrees with the
purchasers named in Schedule I to this Agreement (the "Purchasers") as
follows:
Section 1. Description of Notes and Commitment.
Section 1.1. Description of Notes. The Company will authorize the
issue and sale of:
(a) $30,000,000 aggregate principal amount 7.77% Senior Notes,
Series A, due October 15, 2005 (the "Series A Notes") to be dated the date
of issue, to bear interest from such date at the rate of 7.77% per annum,
payable semiannually on the fifteenth day of October and April in each
year (commencing April 15, 1996) and at maturity and to bear interest on
overdue principal (including any overdue required or optional prepayment
of principal) and Make-Whole Amount, if any, and (to the extent legally
enforceable) on any overdue installment of interest at the Overdue Rate
(as hereinafter defined) after the due date thereof, whether by
acceleration or otherwise, until paid, to be expressed to mature on
October 15, 2005, and to be substantially in the form attached hereto as
Exhibit A-1; and
(b) $15,000,000 aggregate principal amount 6.98% Senior Notes,
Series B, due October 15, 2005 (the "Series B Notes") to be dated the date
of issue, to bear interest from such date at the rate of 6.98% per annum,
payable semiannually on the fifteenth day of October and April in each
year (commencing April 15, 1996) and at maturity and to bear interest on
overdue principal (including any overdue required or optional prepayment
of principal) and Make-Whole Amount, if any, and (to the extent legally
enforceable) on any overdue installment of interest at the Overdue Rate
(as hereinafter defined) after the due date thereof, whether by
acceleration or otherwise, until paid, to be expressed to mature on
October 15, 2005, and to be substantially in the form attached hereto as
Exhibit A-2.
The Series A Notes and the Series B Notes are hereinafter
collectively referred to as the "Notes". Interest on the Notes shall be
computed on the basis of a 360-day year of twelve 30-day months. The
Notes are not subject to prepayment or redemption at the option of the
Company prior to their express maturity dates except on the terms and
conditions and in the amounts and with the Make-Whole Amount, if any, set
forth in Section 2 of this Agreement. The terms which are capitalized
herein shall have the meanings set forth in Section 8.l hereof unless the
context shall otherwise require.
Section 1.2. Commitment, Closing Date. Subject to the terms and
conditions hereof and on the basis of the representations and warranties
hereinafter set forth, the Company agrees to issue and sell to each
Purchaser, and such Purchaser agrees to purchase from the Company, on the
Closing Date mentioned below, the principal amount of Notes set forth
opposite such Purchaser's name in Schedule I, at a price of 100% of the
principal amount thereof.
Delivery of the Notes so to be purchased by the Purchasers will be
made at the offices of Xxxxxxx and Xxxxxx, 000 Xxxx Xxxxxx, Xxxxxxx,
Xxxxxxxx 00000, against payment therefor by wire transfer of Federal or
other funds current and immediately available at the principal office of
Huntington National Bank, ABA #000000000 for Account No. 0000-000000-0, in
the amount of the purchase price, at or about 10:00 a.m., on October 19,
1995 (the "Closing Date"). The Notes delivered to each Purchaser on the
Closing Date will be delivered to such Purchaser in the form of a single
registered Series A Note in the form attached hereto as Exhibit A-1 or a
single registered Series B Note in the form attached hereto as Exhibit
A-2, as the case may be, for the full amount of such Purchaser's purchase
(unless different denominations are specified by such Purchaser),
registered in such Purchaser's name or in the name of such Purchaser's
nominee, all as such Purchaser may specify at any time prior to the date
fixed for delivery.
Section 1.3. Several Commitments. The obligations of each
Purchaser shall be several and not joint and no Purchaser shall be liable
or responsible for the acts of any other Purchaser.
Section 2. Prepayment of Notes.
No prepayment of the Notes may be made except to the extent and in
the manner expressly provided in this Agreement.
Section 2.1. Required Prepayments.
(a) Required Prepayment of Series A Notes. In addition to
paying the entire remaining outstanding principal amount and the interest
due on the Series A Notes on the maturity date thereof, the Company agrees
to prepay and apply and there shall become due and payable the following
sums in respect of the aggregate principal indebtedness evidenced by the
Series A Notes:
Applicable Amount of
Required Payment Date Required Principal Payment
October 15, 1999 $3,000,000
October 15, 2000 $4,000,000
October 15, 2001 $4,000,000
October 15, 2002 $4,000,000
October 15, 2003 $5,000,000
October 15, 2004 $5,000,000
October 15, 2005 $5,000,000
(b) Required Prepayment of Series B Notes. In addition to
paying the entire remaining outstanding principal amount and the interest
due on the Series B Notes on the maturity date thereof, the Company agrees
to prepay and apply and there shall become due and payable the following
sums in respect of the aggregate principal indebtedness evidenced by the
Series B Notes:
Applicable Amount of
Required Payment Date Required Principal Payment
October 15, 1999 $2,500,000
October 15, 2000 $2,000,000
October 15, 2001 $2,000,000
October 15, 2002 $2,000,000
October 15, 2003 $2,500,000
October 15, 2004 $2,500,000
October 15, 2005 $1,500,000
(c) Effects of Required Prepayments.
No Make-Whole Amount shall be payable in connection with any required
prepayment made pursuant to Section 2.1(a) and (b). Any payment of less
than all the Notes of a Series pursuant to the provisions of Section 2.2
shall not relieve the Company of the obligation to make required payments
or prepayments on the Notes in accordance with the terms of Section 2.1(a)
and (b).
In the event the Company shall prepay less than all of the Notes
pursuant to Section 2.2 or repurchase any Notes in accordance with Section
5.12, the amount of the prepayments required by Section 2.1(a) and (b)
shall be reduced by an amount which is the same percentage of such
required prepayment as the percentage that the principal amount of Notes
of the Series so prepaid or repurchased is of the aggregate principal
amount of outstanding Notes of such Series immediately prior to such
prepayment or repurchase.
Section 2.2. Optional Prepayments of Notes. In addition to the
prepayments required by Section 2.1(a) and (b) and Section 2.3, the
Company shall have the privilege at any time of prepaying the then
outstanding Notes of both Series, either in whole or in part (but if in
part then in units of $100,000 in the aggregate or an integral multiple of
$10,000 in the aggregate in excess thereof) by payment of the principal
amount of the Notes of both Series and accrued interest thereon to the
date of such prepayment, together with an amount equal to the then
applicable Make-Whole Amount, determined as of three business days prior
to the date of such prepayment pursuant to this Section 2.2. Any such
prepayment shall be pro rata between each Series.
Section 2.3. Prepayment of Notes upon Change of Control. In the
event that any Change of Control (as hereinafter defined) shall occur, the
Company will give written notice (the "Company Notice") of such fact in
the manner provided in Section 9.6 of this Agreement to the holders of the
Notes. The Company Notice shall be delivered promptly and in any event no
later than three business days following the occurrence of any Change of
Control. The Company Notice shall (a) describe the facts and
circumstances of such Change of Control in reasonable detail, (b) make
reference to this Section 2.3 and the right of the holders of the Notes to
require payment on the terms and conditions provided for in this Section
2.3, (c) offer in writing to prepay the outstanding Notes of both Series,
together with accrued interest to the date of prepayment and an amount
equal to the then applicable Make-Whole Amount and (d) specify the date
for such prepayment (the "Change of Control Prepayment Date") which Change
of Control Prepayment Date shall be no earlier than the date the Change of
Control occurred and no later than fifteen (15) days after the date the
Change of Control occurred. The holders of at least 40% in aggregate
principal amount of outstanding Notes of each respective Series of Notes
shall have the right, by written notice given to the Company not later
than three business days prior to the Change of Control Prepayment Date,
to demand that the Company prepay all (but not less than all) of the
respective Series of Notes then held by such holders on such Change of
Control Prepayment Date. The prepayment price of any Notes payable upon
the Change of Control Prepayment Date shall be an amount equal to 100% of
the principal amount of the Notes so to be prepaid and accrued interest
thereon to the date of such prepayment, together with an amount equal to
the then applicable Make-Whole Amount, determined as of three business
days prior to the date of such prepayment pursuant to this Section 2.3.
Without limiting the foregoing, notwithstanding any failure on the
part of the Company to give the Company Notice herein required as a result
of the occurrence of a Change of Control, each holder of the Notes shall
have the right by delivery of written notice to the Company to require the
Company to prepay, and the Company will prepay, such holder's Notes in
full, together with accrued interest thereon to the date of prepayment and
an amount equal to the Make-Whole Amount at any time within ninety days
after such holder has actual knowledge of any such Change of Control.
Notice of any required prepayment pursuant to this Section 2.3 shall be
delivered by any holder of Notes which was entitled to, but did not
receive, such Company Notice to the Company after such holder has actual
knowledge of such Change of Control. On the date (the "Delayed Prepayment
Date") designated in such holder's notice (which shall be not earlier than
10 business days after the date of such holder's notice), the Company
shall prepay in full all Notes held by such holder together with accrued
interest thereon to the date of prepayment and an amount equal to the
Make-Whole Amount, determined as of three business days prior to the date
of such prepayment pursuant to this Section 2.3. If the holder of any
Note gives any notice pursuant to this second paragraph of Section 2.3,
the Company shall give a Company Notice within two business days of
receipt of such notice and identify the Delayed Prepayment Date to all
holders of the Notes and each of such holders shall then and thereupon
have the rights with respect to the prepayment of its Notes as set forth
in this Section 2.3; provided only that any date for prepayment of such
holder's Notes shall be the Delayed Prepayment Date.
As used in this Section 2.3, a "Change of Control" of the Company
shall be deemed to have occurred at such time or times as the Xxxxxxx
Family (as hereinafter defined), shall fail to own, directly or
indirectly, with full power to vote or to direct the voting of, more than
51% of the voting power of the Voting Stock of the Company.
The term "Xxxxxxx Family" shall mean, collectively, (i) Xxxxxx X.
Xxxxxxx, his spouse, their children or grandchildren; (ii) any trust
directly or indirectly controlled by any one or more of such persons
described in (i) or any corporation described in (iii) below or any
present or former officer of any such corporation; (iii) any corporation
or partnership in which voting control as to such entity is held, directly
or indirectly, by any one or more of such persons described in (i) or such
trusts described in (ii) or by the executor or administrator of the estate
or other legal representative of any such person described in (i); and
(iv) the executor or administrator of the estate or other legal
representative of any person described in (i).
Section 2.4. Notice of Optional Prepayments. The Company will give
notice of any prepayment of the Notes pursuant to Section 2.2 to each
holder thereof not less than 30 days nor more than 60 days before the date
fixed for such optional prepayment specifying (a) such date, (b) the
principal amount of the holder's Notes of such Series to be prepaid on
such date, (c) that a Make-Whole Amount may be payable, (d) the date when
such Make-Whole Amount will be calculated which shall be the date three
business days prior to the prepayment date, (e) the estimated Make-Whole
Amount and (f) the accrued interest applicable to such prepayment. Notice
of prepayment having been so given, the aggregate principal amount of the
Notes of such Series specified in such notice, together with the
Make-Whole Amount, if any, and accrued interest thereon shall become due
and payable on the prepayment date. Not later than two business days
prior to the prepayment date specified in such notice, the Company shall
provide each holder of a Note of such Series written notice of the
Make-Whole Amount, if any, payable in connection with such prepayment and,
whether or not any Make-Whole Amount is payable, a reasonably detailed
computation thereof.
Section 2.5. Allocation of Prepayments. All partial prepayments of
Notes shall be applied on all outstanding Notes of the Series being
prepaid ratably in accordance with the unpaid principal amounts of such
Series; provided, however, that if as a result of the allocation of any
such partial prepayment to any outstanding Note of a Series, such Note of
such Series would then be reduced to an outstanding principal amount of
less than $3,000,000, then such Note of such Series may be exchanged in
whole by any holder thereof notwithstanding the provisions of Section 9.2
hereof and provided, further, that if as a result of the allocation of any
such partial prepayment to any outstanding Note of such Series, such Note
of such Series would then be reduced to an outstanding principal amount of
less than $500,000, then in connection with the payment of any such
partial prepayment, the Company shall pay such additional amount to the
holder of such Note of such Series as may be necessary to prepay the
remaining principal amount of such Note of such Series and accrued
interest thereon to the date of such prepayment, together with an amount
equal to the then applicable Make-Whole Amount thereon, determined as of
three business days prior to the date of such prepayment.
Section 2.6. Direct Payment. Notwithstanding anything to the
contrary in this Agreement or the Notes, in the case of any Note owned by
any Purchaser or any such Purchaser's nominee or owned by any other
Institutional Holder or its nominee which has given written notice to the
Company requesting that the provisions of this Section 2.6 shall apply,
the Company will promptly and punctually pay when due the principal
thereof and the Make-Whole Amount, if any, and interest thereon, without
any presentment thereof directly to such Purchaser, such Purchaser's
nominee or any such subsequent Institutional Holder or its nominee at its
address or such nominee's address set forth in Schedule I or at such other
address as such Purchaser, any such Purchaser's nominee or any such
subsequent Institutional Holder may from time to time designate in writing
to the Company or, if an account with a United States bank is designated
for such Purchaser or such Purchaser's nominee on Schedule I hereto or in
any written notice to the Company from such Purchaser, such Purchaser's
nominee or any such subsequent Institutional Holder, the Company will make
such payments in immediately available funds to such bank account before
10:00 A.M., marked for attention as indicated, or in such other manner or
to such other account in any bank in the United States as such Purchaser,
such Purchaser's nominee or any such subsequent Institutional Holder may
from time to time direct in writing.
Section 3. Representations.
Section 3.1. Representations of the Company. The Company
represents and warrants that all representations set forth in the form of
Closing Certificate attached hereto as Exhibit B are true and correct as
of the date of the execution and delivery hereof by the Company and are
incorporated herein by reference with the same force and effect as though
herein set forth in full.
Section 3.2. Representations of the Purchasers. Each Purchaser
represents, and in entering into this Agreement the Company understands,
that such Purchaser is acquiring the Notes for the purpose of investment
and not with a view to the distribution thereof; provided that the
disposition of such Purchaser's property shall at all times be and remain
within its control. Each Purchaser acknowledges that the Notes have not
and will not be registered under the Act and hereby agrees that it will
not reoffer, resell, pledge or otherwise transfer the Notes purchased by
it under this Agreement except pursuant to any available exemption from
the requirements of Section 5 of the Act and in accordance with any
applicable state securities laws. Each Purchaser further represents that
it is acquiring the Notes for its own account and with its general
corporate assets and not with the assets of separate account in which any
employee benefit plan has any interest. As used in this Section 3.2, the
terms "separate account" and "employee benefit plan" shall have their
respective meanings assigned to them in ERISA.
Section 4. Closing Conditions.
The obligation of each Purchaser to purchase the Notes on the Closing
Date shall be subject to the performance by the Company of its agreements
hereunder which by the terms hereof are to be performed at or prior to the
time of delivery of the Notes and to the following further conditions
precedent:
Section 4.1. Closing Certificate. Concurrently with the delivery
of Notes to such Purchaser on the Closing Date, such Purchaser shall have
received a Closing Certificate dated the Closing Date, signed by the Chief
Financial Officer of the Company, substantially in the form attached
hereto as Exhibit B, the truth and accuracy of which on the Closing Date
shall be a condition to such Purchaser's obligation to purchase the Notes
proposed to be purchased by such Purchaser.
Section 4.2. Legal Opinions. Concurrently with the delivery of
Notes to such Purchaser on the Closing Date, such Purchaser shall have
received from Xxxxxxx and Xxxxxx, who are acting as special counsel to the
Purchasers in this transaction and from Xxxxx & Lardner, independent
counsel to the Company, their respective opinions dated the Closing Date,
in form and substance satisfactory to such Purchaser, and covering the
matters set forth in Exhibits C and D, attached hereto.
Section 4.3. Company's Existence and Authority. On or prior to the
Closing Date, such Purchaser shall have received, in form and substance
reasonably satisfactory to such Purchaser, such documents and evidence
with respect to the Company as such Purchaser may reasonably request in
order to establish the existence and good standing of the Company and the
authorization of the transactions contemplated by this Agreement.
Section 4.4. Consent of Holders of Other Securities. Any consents
or approvals required to be obtained from any holder or holders of any
outstanding Security of the Company and any amendments of agreements
pursuant to which any Securities may have been issued which will be
necessary to permit the consummation of the transactions contemplated
hereby on the Closing Date shall have been obtained and all such consents
or amendments shall be satisfactory in form and substance to such
Purchaser.
Section 4.5. Legality of Investment. The Notes to be purchased by
such Purchaser shall be a legal investment for such Purchaser under the
laws of each jurisdiction to which such Purchaser may be subject (without
resort to any so-called basket provisions to such laws).
Section 4.6. Related Transactions. Concurrently with the issuance
and sale of Notes to such Purchaser, the Company shall have consummated
the sale of the entire principal amount of the Notes pursuant to this
Agreement.
Section 4.7. Satisfactory Proceedings. All proceedings taken in
connection with the transactions contemplated by this Agreement, and all
documents necessary to the consummation thereof, shall be satisfactory in
form and substance to such Purchaser, and such Purchaser shall have
received a copy (executed or certified as may be appropriate) of all legal
documents or proceedings taken in connection with the consummation of such
transactions.
Section 4.8. Waiver of Conditions. If on the Closing Date the
Company fails to tender to any Purchaser the Notes to be issued to any
Purchaser on such date or if the conditions specified in this Section 4
have not been fulfilled, such Purchaser may thereupon elect to be relieved
of all further obligations under this Agreement. Without limiting the
foregoing, if the conditions specified in this Section 4 have not been
fulfilled, such Purchaser may waive compliance by the Company with any
such condition to such extent as such Purchaser may in its sole discretion
determine. Nothing in this Section 4.8 shall operate to relieve the
Company of any of its obligations hereunder or to waive the Purchaser's
rights against the Company.
Section 4.9. Private Placement Numbers. The Company shall have
obtained for the Notes a Private Placement Number issued by Standard &
Poor's CUSIP Bureau (in cooperation with the Securities Valuation office
of the National Association of Insurance Commissioners).
Section 4.10. Payment of Closing Costs. The Company shall have paid
the costs, expenses and disbursements of such Purchaser's special counsel
which are reflected in statements of such counsel rendered prior to the
Closing pursuant to Section 9.4; and thereafter (without limiting the
provisions of Section 9.4) the Company will pay, promptly upon receipt of
any supplemental statements therefor, additional costs or fees, if any,
and expenses and disbursements of such Purchaser's counsel in connection
with the Closing (including disbursements unposted as of the Closing Date)
and attention to post-Closing matters.
Section 5. Company Covenants.
From and after the date of this Agreement and continuing so long as
any amount remains unpaid on any date:
Section 5.1. Corporate Existence, Etc. The Company will preserve
and keep in force and effect, and will cause each Restricted Subsidiary to
preserve and keep in force and effect, its corporate existence. The
Company will preserve and keep in force and effect, and will cause each
Restricted Subsidiary to preserve and keep in force and effect, all
franchises, licenses and permits necessary to the proper conduct of its
business. The foregoing provisions of this Section 5.1 shall not,
however, prevent any transaction not prohibited by Section 5.8.
Section 5.2. Insurance. The Company will maintain, and will cause
each Restricted Subsidiary to maintain, insurance coverage by financially
sound and reputable insurers consistent with such forms and amounts and
against such risks as are presently maintained by the Company and its
Restricted Subsidiaries provided that, notwithstanding the foregoing, the
Company and its Restricted Subsidiaries shall maintain insurance coverage
in such forms and amounts and against such risks as are customary for
business entities of established reputation engaged in the same or a
similar business and owning and operating similar properties.
Section 5.3. Taxes, Claims for Labor and Materials, Compliance with
Laws. (a) The Company will promptly pay and discharge, and will cause
each Restricted Subsidiary promptly to pay and discharge, all lawful
taxes, assessments and governmental charges or levies imposed upon it or
upon or in respect of all or any part of its property or business, all
trade accounts payable in accordance with usual and customary business
terms, and all claims for work, labor or materials, which if unpaid might
become a Lien or charge upon any of its property; provided the Company or
such Restricted Subsidiary shall not be required to pay any such tax,
assessment, charge, levy, account payable or claim if (1) the validity,
applicability or amount thereof is being contested in good faith by
appropriate actions or proceedings which will prevent the forfeiture or
sale of any property of the Company or such Restricted Subsidiary or any
material interference with the use thereof by the Company or such
Restricted Subsidiary and (2) the Company or such Restricted Subsidiary
shall set aside on its books, reserves deemed by the Company to be
adequate with respect thereto.
(b) The Company will promptly comply, and will cause each
Restricted Subsidiary to comply, in all material respects with all laws,
ordinances or governmental rules and regulations to which it is subject,
including without limitation, the Occupational Safety and Health Act of
1970, as amended, ERISA, and all laws, ordinances, governmental rules and
regulations relating to environmental protection in all applicable
jurisdictions, the violation of which would materially and adversely
affect the properties, business, prospects, profits or condition of the
Company and its Restricted subsidiaries, taken as whole, or would result
in any Lien not permitted under Section 5.7.
Section 5.4. Maintenance, Etc. The Company will maintain, preserve
and keep, and will cause each Restricted Subsidiary to maintain, preserve
and keep, its material properties which are used or useful in the conduct
of its business (whether owned in fee or a leasehold interest) in good
repair and working order, ordinary wear and tear excepted, and from time
to time will make all necessary repairs, replacements, renewals and
additions so that at all times the efficiency thereof shall be maintained.
Section 5.5. Nature of Business. Neither the Company nor any
Restricted Subsidiary will engage in any business if, as a result, the
general nature of the business, taken on a consolidated basis, which would
then be engaged by the Company and its Restricted Subsidiaries would be
substantially changed from the general nature of the business engaged by
the Company and its Restricted Subsidiaries on the date of this Agreement.
Section 5.6. Limitations on Indebtedness. (a) The Company will
not, and will not permit any Restricted Subsidiary to, create, issue,
assume, guarantee or otherwise incur or in any manner become liable in
respect of any additional Current Debt or Funded Debt except:
(1) the Notes;
(2) Current Debt and Funded Debt of the Company and its
Restricted Subsidiaries outstanding as of the date of this Agreement and
described on Schedule II attached hereto;
(3) Current Debt or Funded Debt of the Company and its
Restricted Subsidiaries; provided that at the time of creation, issuance,
assumption, guarantee or incurrence thereof and after giving effect
thereto and to the application of the proceeds thereof, Consolidated
Funded Debt would not exceed 50% of Consolidated Total Capitalization,
provided that for purposes of any determination of additional Funded Debt
to be issued or incurred within the limitation of this Section 5.6(a)(3),
the Average Outstanding Balance of Consolidated Current Debt (as defined
in Section 5.6(e) below) computed for the Compliance Period (as defined in
Section 5.6(e) below) preceding the date of any such determination shall
be deemed to constitute outstanding Funded Debt of the Company incurred as
of the last day of such Compliance Period and shall be deemed outstanding
at all times prior to the end of the next Compliance Period; and
(4) additional Current Debt or Funded Debt of a Restricted
Subsidiary to the Company or to an Eighty Percent-Owned Restricted
Subsidiary.
(b) The Company will not at any time permit the sum of (i)
Current Debt and Funded Debt of Restricted Subsidiaries (other than
Current Debt and Funded Debt owed to the Company or an Eighty
Percent-Owned Restricted Subsidiary), plus (ii) Funded Debt of the Company
and Restricted Subsidiaries secured by Liens permitted by Section
5.7(a)(9) to exceed 25% of Consolidated Tangible Assets.
(c) Any Person which becomes a Restricted Subsidiary after the
date hereof shall for all purposes of this Section 5.6 be deemed to have
created, assumed or incurred or issued at the time it becomes a Restricted
Subsidiary all Current Debt and Funded Debt of such Person existing
immediately after it becomes a Restricted Subsidiary.
(d) The renewal, extension or refunding of any Current Debt or
Funded Debt issued or incurred in accordance with the limitations of this
Section 5.6 shall constitute the Issue of additional Current Debt or
Funded Debt, as the case may be, which is, in turn, subject to the
limitations of the applicable provisions of this Section 5.6.
(e) For the purposes of Section 5.6(a) hereof, the following
terms shall have the meanings ascribed to them below:
"Average Outstanding Balance of Consolidated Current Debt" shall mean
the average of the aggregate unpaid principal amounts of Consolidated
Current Debt outstanding on each of the Company's July fiscal month-end,
August 15, the Company's August fiscal month-end, September 15 and the
Company's September fiscal month-end for each Compliance Period.
"Compliance Period" shall mean the period beginning on the date of
the Company's July fiscal month-end and ending on the date of the
Company's September fiscal month-end in each calendar year.
Section 5.7. Limitation on Liens. (a) The Company will not, and
will not permit any Restricted Subsidiary to, create or incur, or suffer
to be incurred or to exist, any Lien on its or their property or assets,
whether now owned or hereafter acquired, or upon any income or profits
therefrom, or transfer any property for the purpose of subjecting the same
to the payment of obligations in priority to the payment of its or their
general creditors, or acquire or agree to acquire or permit any Restricted
Subsidiary to acquire any property or assets pursuant to conditional sales
agreements or other title retention devices, except:
(1) Liens for property taxes and assessments or governmental
charges or levies and Liens securing claims or demands of mechanics and
materialmen; provided that payment thereof is not at the time required by
Section 5.3;
(2) Liens of or resulting from any judgment or award, the time
for the appeal or petition for rehearing of which shall not have expired,
or in respect of which the Company or a Restricted Subsidiary shall at any
time in good faith be prosecuting an appeal or proceeding for a review and
in respect of which a stay of execution pending such appeal or proceeding
for review shall have been secured;
(3) Liens incidental to the conduct of business or the
ownership of properties and assets (including, without limitation,
warehousemen's and attorneys' liens, statutory landlords' liens, workers'
compensation liens and ERISA liens) and deposits, pledges or Liens to
secure the performance of bids, tenders or trade contracts, or to secure
statutory obligations, surety or appeal bonds or other Liens of like
general nature incurred in the ordinary course of business and not in
connection with the borrowing of money; provided that the aggregate amount
of the obligations so secured will not materially impair the value of the
assets so secured or the use thereof in the ordinary course of business
and provided, further, that in each case, the obligation so secured will
not exceed $1,000,000 and is not overdue or, if overdue, is being
contested in good faith by appropriate actions or proceedings;
(4) minor survey exceptions or minor encumbrances, easements or
reservations, or rights of others for rights-of-way, utilities and other
similar purposes, or zoning or other restrictions as to the use of real
properties, which are necessary for the conduct of the activities of the
Company and its Restricted Subsidiaries or which customarily exist on
properties of Persons engaged in similar activities and similarly situated
and which do not in any event materially impair their use in the operation
of the business of the Company and its Restricted Subsidiaries;
(5) Liens securing Indebtedness of a Restricted Subsidiary to
the Company or to an Eighty Percent-Owned Restricted Subsidiary;
(6) Liens existing as of the date of this Agreement securing
Indebtedness of the Company or any Restricted Subsidiary outstanding on
such date and described on Schedule II attached to this Agreement;
(7) Liens incurred after the date of this Agreement given to
secure the payment of the cost of the acquisition or construction of fixed
assets useful and intended to be used in carrying on the business of the
Company or a Restricted Subsidiary; provided that (i) the Lien shall
attach solely to the fixed assets acquired or constructed, (ii) the Lien
shall have been created or incurred within twelve (12) months of the date
of acquisition or the date of completion of construction, as the case may
be, of such fixed assets, (iii) at the time of the acquisition or
construction of such fixed assets the aggregate amount remaining unpaid on
all Indebtedness secured by Liens on such fixed assets whether or not
assumed by the Company or a Restricted Subsidiary shall not exceed an
amount equal to the lesser of the total cost or fair market value at the
time of acquisition or completion of construction of such fixed assets (as
determined in good faith by the Board of Directors of the Company) and
(iv) all such Indebtedness shall have been incurred within the applicable
limitations of Section 5.6;
(8) Liens existing on any assets at the time of acquisition
thereof or at the time of acquisition by the Company or a Restricted
Subsidiary of any business entity then owning such assets, whether or not
such existing Liens were given to secure the payment of the purchase price
of the assets to which they attach, so long as they were not incurred,
extended or renewed in contemplation of such acquisition; provided that
(i) any such Lien shall attach solely to the assets acquired or the assets
of such business entity and (ii) at the time of the acquisition of the
assets or business entity, as the case may be, the aggregate amount
remaining unpaid on all Indebtedness secured by Liens on such assets
(whether or not assumed by the Company or such Restricted Subsidiary)
shall not be in excess of the fair market value of such assets at the time
of such acquisition (as determined in good faith by the Board of Directors
of the Company);
(9) Liens incurred after the date of this Agreement given to
secure Funded Debt of the Company or any Restricted Subsidiary in addition
to the Liens permitted by the preceding clauses (1) through (8) hereof;
provided that all Indebtedness secured by such Liens shall have been
incurred within the applicable limitations of Section 5.6; and
(10) any extension, renewal or replacement of any Lien permitted
by the preceding clauses (6), (7) and (8) of this Section 5.7 in respect
of the same property theretofore subject to such Lien in connection with
the extension, renewal or refunding of the Indebtedness secured thereby;
provided that (i) such Lien shall attach solely to the same such property
and (ii) such extension, renewal or refunding of such Indebtedness shall
have been incurred within the applicable limitations of Section 5.6.
(b) In the event any property or assets of the Company or any
Restricted Subsidiary are subjected to a Lien not otherwise permitted by
this Section 5.7, the Company will make or cause to be made provision
whereby the Notes will be secured, to the full extent permitted under
applicable law, equally and ratably with all other obligations secured
thereby, and in any case the Notes shall (but only in such event) have the
benefit, to the full extent that the holders may be entitled thereto under
applicable law, of an equitable Lien on such property or assets equally
and ratably securing the Notes. Compliance with the provisions of this
paragraph shall not be deemed to constitute a waiver of, or consent to,
any Default or Event of Default caused by any violation of the provisions
of this Section 5.7.
Section 5.8. Mergers Consolidations, Sales of Assets, Etc. (a) The
Company will not, and will not permit any Restricted Subsidiary to,
consolidate with or be a party to a merger with or liquidate into any
other Person; provided, however, that:
(1) any Restricted Subsidiary may merge or consolidate with or
liquidate into the Company, any Wholly-Owned Subsidiary or any Restricted
Subsidiary that is the direct or indirect parent of such Restricted
Subsidiary and any Restricted Subsidiary (other than a Principal
Subsidiary) may merge or consolidate with or liquidate into any other
Restricted Subsidiary so long as (i) in any merger or consolidation
involving the Company, the Company shall be the surviving corporation and
(ii) in any merger, consolidation or liquidation involving a Domestic
Restricted Subsidiary and a non-Domestic Restricted Subsidiary, the
Domestic Restricted Subsidiary shall be the surviving corporation; and
(2) the Company or any Restricted Subsidiary may consolidate or
merge with any other corporation if (i) (in the case of a merger or
consolidation involving the Company) the surviving or acquiring
corporation (if other than the Company) (A) is organized and existing
under the laws of any State of the United States of America or the
District of Columbia, (B) shall expressly assume in writing the due and
punctual performance of all obligations of the Company under this
Agreement and the due and punctual payment of the principal of and
Make-Whole Amount if any, and interest on all the Notes, according to
their tenor, and (C) the Company or such surviving or acquiring
corporation shall furnish to the holders of the Notes an opinion of
counsel satisfactory to such holders to the effect that the instrument of
assumption has been duly authorized, executed and delivered and
constitutes the legal, valid and binding contract and agreement of the
surviving or acquiring corporation enforceable in accordance with its
terms, except as enforcement of such terms may be limited by bankruptcy,
insolvency or similar laws affecting the enforcement of creditors' rights
generally, and subject, as to enforceability, to general principles of
equity (regardless of whether enforcement is sought in a proceeding in
equity or at law), or (ii) (in the case of a merger or consolidation
involving a Restricted Subsidiary) such Restricted Subsidiary shall be the
surviving corporation and (iii) in the case of any consolidation or merger
described in either (i) or (ii), at the time of such consolidation or
merger, and after giving effect thereto (A) no Default or Event of Default
shall have occurred and be continuing and (B) the Company, such surviving
or acquiring corporation or such Restricted Subsidiary, as the case may
be, would be permitted to incur at least $1 of additional Funded Debt
under the applicable provisions of Section 5.6.
(b) The Company will not, and will not permit any Restricted
Subsidiary to, sell, lease, transfer, abandon or otherwise dispose of,
assets (other than (x) sales of goods, products, inventory or services in
the ordinary course of business to customers, (y) the sale, lease,
transfer or disposition of assets to the Company or a Domestic Restricted
Subsidiary if a merger between such transferor and such Domestic
Restricted Subsidiary would be permitted under Section 5.8(a)(1), and (z)
sales or other dispositions of assets, having a fair market value (as
determined in good faith by the chief financial officer of the Company) in
any single sale or disposition of not greater than $250,000 which the
Company determines have become inadequate, obsolete, worn out, unsuitable,
undesirable or unnecessary in the conduct of its business); provided that
the foregoing restrictions do not apply to the sale of assets for cash or
property to a Person or Persons if all of the following conditions are
met:
(1) either (i) the net book value of such assets, when added to
the net book value of all other assets sold, leased, transferred or
otherwise disposed of by the Company and its Restricted Subsidiaries
pursuant to this Section 5.8(b)(1) during the immediately preceding
twelve-month period do not constitute 10% of Consolidated Total Assets
(determined as of the end of the immediately preceding fiscal quarter) or
(ii) the sum of the portions of Consolidated Net Income contributed for
the immediately preceding twelve-month period (each as determined in good
faith by the chief financial officer of the Company) by (A) such assets,
(B) each Restricted Subsidiary (or portion thereof) disposed of during
such period and (C) other assets of the Company and its Restricted
Subsidiaries disposed of during such period pursuant to this Section
5.8(b)(1) do not constitute 10% of Consolidated Net Income for such
period; and
(2) immediately after the consummation of the transaction and
after giving effect thereto, (i) no Default or Event of Default would
exist and (ii) the Company would be permitted to incur at least $1 of
additional Funded Debt under the provisions of Section 5.6(a)(3).
Computations made pursuant to Section 5.8(b)(1) shall include
dispositions made pursuant to Sections 5.8(c)(3) and 5.8(c)(4) and
computations pursuant to Sections 5.8(c)(3) and 5.8(c)(4) shall include
dispositions made pursuant to Section 5.8(b)(1).
(c) The Company will not, and will not permit any Restricted
Subsidiary to, sell, transfer or otherwise dispose of any shares of
capital stock (including as "stock" for the purposes of this Section
5.8(c), any warrants, rights or options to purchase or otherwise acquire
stock or other Securities exchangeable for or convertible into such stock)
of any Restricted Subsidiary, and the Company will not permit any
Restricted Subsidiary to issue any shares of stock of such Restricted
Subsidiary (except for any sale, transfer, issuance or other disposition
of stock to the Company or a Restricted Subsidiary if a merger between
such transferor or issuer and such Restricted Subsidiary would be
permitted under Section 5.8(a)(1); provided that the foregoing
restrictions do not apply to:
(1) the sale, transfer or issuance of directors' qualifying
shares of capital stock;
(2) the sale, transfer or issuance of any de minimis number of
shares of capital stock to foreign domiciliaries as may be required by
law;
(3) the sale, transfer or other disposition of all or any part
of the shares of capital stock of any Restricted Subsidiary (other than a
Principal Subsidiary);
(4) the sale, transfer or other disposition of all shares of
capital stock of a Principal Subsidiary held by the Company and its
Restricted Subsidiaries if all of the following conditions are met:
(i) simultaneously with such sale, transfer, or disposition,
all shares of stock and all Indebtedness of such Principal Subsidiary at
the time owned by the Company and by every other Restricted Subsidiary
shall be sold, transferred or disposed of as an entirety;
(ii) the Board of Directors of the Company shall have
determined, as evidenced by a resolution thereof, that the proposed sale,
transfer or disposition of said shares of stock and Indebtedness is in the
best interests of the Company;
(iii) said shares of stock and Indebtedness are sold, transferred
or otherwise disposed of to a Person or Persons, for cash and/or tangible
assets and on terms reasonably deemed by the Board of Directors of the
Company to be adequate and satisfactory; and
(iv) the Principal Subsidiary being disposed of shall not have
any continuing investment in the Company or any other Restricted
Subsidiary not being simultaneously disposed of;
(5) the sale, transfer or issuance of shares of capital stock
of a Restricted Subsidiary in connection with the purchase or other
acquisition by the Company or a Restricted Subsidiary of all or
substantially all of the capital stock, properties or assets of any Person
or all or substantially all of the properties or assets of any Person
which constitute a distinct product line, division or other operating
segment; provided that:
(i) after giving effect to such sale, transfer or issuance and
such purchase or other acquisition, no Default or Event of Default would
then exist;
(ii) the aggregate fair value of all such capital stock,
properties or assets so acquired attributable to the issuance, sale or
transfer of such shares of capital stock in each sale, transfer or
issuance of such shares shall equal or exceed the fair value of such
shares (in each case as determined in good faith by the Board of Directors
of the Company at the time of such acquisition taking into consideration
the terms of any written agreement described in Section 5.8(c)(5)(iii)
below); and
(iii) the shares of capital stock are sold, transferred or issued
pursuant to a written agreement which (A) contemplates the subsequent
purchase or redemption of such shares by the Company or the Restricted
Subsidiary whose shares have been so sold, transferred or issued or any
direct or indirect parent of such Restricted Subsidiary upon request of
the transferee of such shares or upon demand by the Company or such
Restricted Subsidiary or any direct or indirect parent of such Restricted
Subsidiary made pursuant to the terms of such written agreement at a price
or prices computed by reference to such formulas or indices or other
references as are determined in good faith by the Board of Directors of
the Company at the time of such acquisition to be in the best interests of
the Company and its Restricted Subsidiaries and (B) prohibits the transfer
of such shares to any Person other than the Company or the Restricted
Subsidiary whose shares have been so sold, transferred or issued or any
direct or indirect parent of such Restricted Subsidiary; and
(6) the sale, transfer or issuance of capital stock to
employees of Restricted Subsidiaries as part of any incentive stock
arrangement other than any incentive stock agreement entered into in
connection with any purchase or acquisition contemplated by Section
5.8(c)(5) provided that:
(i) after giving effect to such issuance no Restricted
Subsidiary shall cease to be a Restricted Subsidiary; and
(ii) the aggregate fair value (in each case determined in good
faith at the time of such issuance by the Board of Directors of the
Company or such person or committee as the Board of Directors of the
Company may authorize to make such determination pursuant to the terms of
any such incentive stock arrangement) of all shares of capital stock of
such Restricted Subsidiaries issued to such employees shall not exceed
$2,000,000;
provided, however, that notwithstanding the foregoing, any sale, transfer,
issuance or other disposition of shares pursuant to Sections 5.8(c)(3) or
5.8(c)(4) may not be consummated if either (y) the net book value of the
assets of such Restricted Subsidiary attributable to such sale, transfer,
issuance or other disposition of shares when added to the net book value
of all other assets sold, leased, transferred or otherwise disposed of by
the Company and its Restricted Subsidiaries during the immediately
preceding twelve-month period would constitute more than 10% of
Consolidated Total Assets (determined as of the end of the immediately
preceding fiscal quarter) or (z) the portions of Consolidated Net Income
for the immediately preceding twelve-month period contributed (each as
determined in good faith by the chief financial officer of the Company) by
(1) such assets, (2) each Restricted Subsidiary (or portion thereof)
disposed of during such period and (3) other assets of the Company and its
Restricted Subsidiaries sold, leased, transferred or otherwise disposed of
by the Company and its Restricted Subsidiaries during such period would
exceed 10% of Consolidated Net Income for such period.
Computations made with respect to Sections 5.8(c)(3) and 5.8(c)(4) as
contemplated by this Section 5.8(c) shall include dispositions made within
the provisions of Sections 5.8(b)(1) and computations made pursuant to
Sections 5.8(b)(1) shall include dispositions made pursuant to Sections
5.8(c)(3) and 5.8(c)(4).
(d) Notwithstanding any other provision of this Section 5.8,
the Company may sell stock or assets of America Outdoors, Inc., Airguide
Instrument Co. and all of the Plastimo businesses. Sales of stock or
assets permitted by this Section 5.8(d) shall not be taken into account
for purposes of calculating the limitations on permitted sales of assets
and stock set forth in Section 5.8(b)(1) and the proviso at the end of
Section 5.8(c).
Section 5.9. Consolidated Tangible Net Worth. The Company will at
all times keep and maintain Consolidated Tangible Net Worth at an amount
not less than $25,000,000.
Section 5.10. Distributions. (a) The Company will not, and will not
permit any Restricted Subsidiary to, except as hereinafter provided:
(1) declare or pay any dividends, either in cash or property,
on any shares of its capital stock of any class (except dividends or other
distributions payable solely in shares of capital stock of the Company and
dividends paid by Restricted Subsidiaries to the Company or other
Restricted Subsidiaries in respect of capital stock of Restricted
Subsidiaries owned by the Company or such other Restricted Subsidiaries);
or
(2) directly or indirectly, or through any Subsidiary,
purchase, redeem or retire any shares of its capital stock of any class or
any warrants, rights or options to purchase or acquire any shares of its
capital stock (other than (i) in exchange for or out of the net cash
proceeds to the Company obtained within three months of such purchase,
redemption or retirement from the issue or sale of other shares of capital
stock of the Company or warrants, rights or options to purchase or acquire
any shares of its capital stock, or (ii) in connection with any purchase
or redemption of any shares of capital stock sold, transferred or issued
in accordance with Sections 5.8(c)(1), 5.8(c)(2) or 5.8(c)(5)); or
(3) make any other payment or distribution, either directly or
indirectly or through any Subsidiary, in respect of its capital stock;
(such declarations or payments of dividends, purchases, redemptions or
retirements of capital stock and warrants, rights or options and all such
other payments or distributions being herein collectively called
"Distributions"), unless after giving effect thereto no Default or Event
of Default would exist and the aggregate amount of Distributions made
during the period from and after June 14, 1991 to and including the date
of the making of the Distributions in question would not exceed the sum of
(1) $5,000,000, plus (2) 50% of Consolidated Net Income for such period,
computed on a cumulative basis for said entire period (or if such
Consolidated Net Income is a deficit figure, then minus 100% of such
deficit).
(b) For the purposes of this Section 5.10, the amount of any
Distribution declared, paid or distributed in property shall be deemed to
be the greater of the book value or fair market value (as determined in
good faith by the Board of Directors of the Company) of such property at
the time of the making of the Distribution in question.
(c) The Company will not authorize or make a Distribution on
its capital stock if after giving effect to the proposed Distribution:
(1) a Default or Event of Default would exist, or
(2) the Company could not incur at least $1.00 of additional
Funded Debt pursuant to Section 5.6(a)(3).
Section 5.11. Investments. The Company will not, and will not
permit any Restricted Subsidiary to, make any Investments, other than:
(a) Investments by the Company or a Restricted Subsidiary in
and to Restricted Subsidiaries, including any Investment in a Person
which, after giving effect to such Investment, will become a Restricted
Subsidiary;
(b) Investments in property or assets to be used in the usual
and ordinary course of business of the Company or its Restricted
Subsidiaries; provided that, after giving effect to any such Investment,
the Company remains in compliance with Section 5.5 hereof;
(c) Investments in commercial paper maturing in 270 days or
less from the date of issuance which, at the time of acquisition by the
Company or any Restricted Subsidiary, is accorded the highest rating by
Standard & Poor's Corporation, Xxxxx'x Investors Service, Inc. or another
credit rating agency of recognized national standing;
(d) Investments in direct obligations of the federal
governments of the United States of America, Canada or England and Wales
or any direct agency or instrumentality of any thereof, the payment or
guarantee of which constitutes a full faith and credit obligation of the
federal governments of the United States of America, Canada or England and
Wales or any direct agency or instrumentality of any thereof, as the case
may be, in each case, maturing in twelve months or less from the date of
acquisition thereof;
(e) Term Federal funds and banker's acceptances maturing within
180 days from the date of acquisition thereof and issued by a bank
organized under the laws of the United States, Canada, or England and
Wales, having capital, surplus and undivided profits aggregating at least
U.S. $l00,000,000; provided that the issuing institution has a rating of
A- or better by Xxxxx Bank Watch Service;
(f) Investments in certificates of deposit maturing within one
year from the date of acquisition thereof, issued by a bank or trust
company organized under the laws of the United States, having capital,
surplus and undivided profits aggregating at least $100,000,000 and whose
long-term certificates of deposit are, at the time of acquisition thereof
by the Company or a Restricted Subsidiary, rated A or better by Standard &
Poor's Corporation or by Xxxxx'x Investors Service, Inc.;
(g) loans or advances in the usual and ordinary course of
business to officers, directors, and employees incidental to carrying on
the business of the Company or any Restricted Subsidiary;
(h) receivables arising from the sale of goods and services in
the ordinary course of business of the Company and its Restricted
Subsidiaries; and
(i) other Investments (in addition to those permitted by the
foregoing provisions of this Section 5.11); provided that (1) all such
other Investments shall not exceed in the aggregate 25% of Consolidated
Tangible Net Worth Available for Investments and (2) after giving effect
to such other Investments, no Default or Event of Default would exist.
In valuing any Investments for the purpose of applying the
limitations set forth in this Section 5.11, such Investments shall be
taken at the original cost thereof, without allowance for any subsequent
write-offs or appreciation or depreciation therein, but less any amount
repaid or recovered on account of capital or principal.
For purposes of this Section 5.11, at any time when a Person becomes
a Restricted Subsidiary, all Investments of such Person at such time shall
be deemed to have been made by such Person, as a Restricted Subsidiary, at
such time.
Section 5.12. Repurchase of Notes. Neither the Company nor any
Subsidiary or Affiliate, directly or indirectly, may repurchase or make
any offer to repurchase any Notes unless the offer has been made in
writing to repurchase Notes, pro rata, from all holders of the Notes at
the same time and upon the same terms. In case the Company or any
Subsidiary repurchases any Notes, such Notes shall thereafter be cancelled
and no Notes shall be issued in substitution therefor.
Section 5.13. Transactions with Affiliates. The Company will not,
and will not permit any Restricted Subsidiary to, enter into or be a party
to any material transaction or arrangement with any Affiliate (including,
without limitation, the purchase from, sale to or exchange of property
with, or the rendering of any service by or for, any Affiliate), except
transactions reasonably deemed by the Company in good faith to be in the
best business interests of the Company or the concerned Restricted
Subsidiary and upon fair and reasonable terms no less favorable to the
Company or such Restricted Subsidiary than would obtain in a comparable
arm's-length transaction with a Person other than an Affiliate.
Section 5.14. ERISA Compliance. The Company will not, and will not
permit any Subsidiary to:
(a) permit any Plans at any time maintained by the Company or
any such Subsidiary to have any Unfunded Vested Pension Liabilities in
excess of $1,000,000 in the aggregate. As used herein, "Unfunded Vested
Pension Liability" shall mean an excess of the actuarial present value of
accumulated vested Plan benefits as at the end of the immediately
preceding Plan year of such Plans (or as of any more recent valuation
date) over the net assets allocated to such Plans which are available for
benefits, all as determined and disclosed in the most recent actuarial
valuation report for such Plans;
(b) cause any Plan which it or any Subsidiary maintains or in
which it or any Subsidiary participates at any time to:
(1) engage in any "prohibited transaction" (as such term is
defined in ERISA);
(2) incur any "accumulated funding deficiency" (as such term is
defined in ERISA) whether or not waived; or
(3) terminate any such Plan in a manner which could result in
the imposition of a lien on any property of the Company or any of its
Subsidiaries pursuant to ERISA;
(c) permit any condition to exist in connection with any Plan
which might constitute grounds for the PBGC to institute proceedings to
have such Plan terminated or a trustee appointed to administer such Plan;
or
(d) withdraw from any Multiemployer Plan if such withdrawal
shall subject the Company or any Subsidiary to withdrawal liability (as
described under Part 1 of Subtitle E of Title IV of ERISA) in excess of
$100,000.
All assumptions and methods used to determine the actuarial valuation
of vested employee benefits under any Plan at any time maintained by the
Company or any Subsidiary and the present value of assets of such Plans
shall be reasonable in the good faith judgment of the Company and shall
comply with all requirements of law.
Section 5.15. Reports and Rights of Inspection. The Company will
keep, and will cause each Restricted Subsidiary to keep, proper books of
record and account in which full and correct entries will be made of all
dealings or transactions of or in relation to its business and affairs, in
accordance with relevant accounting principles consistently applied and in
the case of the Company and any Domestic Restricted Subsidiaries in
accordance with GAAP (except for changes disclosed in the financial
statements furnished to the Holders pursuant to this Section 5.15 and
concurred in by the independent public accountants referred to in Section
5.15(b)), and will furnish to each Institutional Holder of the outstanding
Notes (in duplicate if so specified below or otherwise requested) and, in
the case of the financial statements delivered pursuant to paragraph (b)
of this Section 5.15, to the Securities Valuation Office, National
Association of Insurance Commissioners, 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000:
(a) Quarterly Statements. As soon as available and in any
event within 45 days after the end of each quarterly fiscal period (except
the last) of each fiscal year, duplicate copies of:
(1) a consolidated balance sheet of the Company and its
Restricted Subsidiaries as of the close of such quarterly period, setting
forth in comparative form the consolidated figures for the corresponding
period for the preceding fiscal year,
(2) a consolidated statement of income of the Company and its
Restricted Subsidiaries for such quarterly fiscal period and for the
portion of the fiscal year ending with such quarterly fiscal period, in
each case setting forth in comparative form the consolidated figures for
the corresponding periods of the preceding fiscal year, and
(3) a consolidated statement of cash flows of the Company and
its Restricted Subsidiaries for the portion of the fiscal year ending with
such quarterly fiscal period, setting forth in comparative form the
consolidated figures for the corresponding period of the preceding fiscal
year, all in reasonable detail and certified as complete and correct by an
authorized financial officer of the Company;
(b) Annual Statements. As soon as available and in any event
within 90 days after the close of each fiscal year of the Company,
duplicate copies of:
(1) consolidated balance sheets of the Company and its
Restricted Subsidiaries as of the close of such fiscal year, and
(2) consolidated statements of income and retained earnings and
cash flows of the Company and its Restricted Subsidiaries for such fiscal
year,
in each case setting forth in comparative form the consolidated figures
for the preceding fiscal year, all in reasonable detail and accompanied by
an opinion thereon of a firm of independent public accountants of
recognized national standing selected by the Company, unqualified as to
scope, to the effect that the consolidated financial statements present
fairly, in all material respects, the consolidated financial position of
the Company and its Restricted Subsidiaries as of the end of the fiscal
year being reported on and the consolidated results of the operations and
cash flows for said year in conformity with GAAP and that the examination
of such accountants in connection with such financial statements has been
conducted in accordance with generally accepted auditing standards and
included such tests of the accounting records and such other auditing
procedures as were considered necessary in the circumstances;
(c) Audit Reports. Promptly upon initiation thereof, written
notice of each interim or special audit to be made by independent
accountants of the books of the Company or any Restricted Subsidiary and
any management letter to be delivered from such accountants in connection
therewith;
(d) SEC and Other Reports. Promptly upon their becoming
available, one copy of each financial statement, report, notice, press
release or proxy statement sent by the Company to stockholders generally
or made available to the public and one copy of each regular or periodic
report, registration statement or prospectus filed by the Company or any
Restricted Subsidiary with any securities exchange or the Securities and
Exchange Commission or any successor agency, and, if the Purchasers or any
such Institutional Holder so requests, one copy of any material order in
any proceedings to which the Company or any of its Restricted Subsidiaries
is a party, issued by any governmental agency, Federal or state, having
jurisdiction over the Company or any of its Restricted Subsidiaries;
(e) Officers' Certificates. Within the periods provided in
paragraphs (a) and (b) above, a certificate of an authorized financial
officer of the Company stating that such officer has reviewed the
provisions of this Agreement and setting forth: (1) the information and
computations (in sufficient detail) required in order to establish whether
the Company was in compliance with the applicable requirements of Sections
5.6 through 5.11 hereof at the end of the period covered by the financial
statements then being furnished and (2) whether, to the best of his
knowledge based on such review, there existed as of the date of such
financial statements or there exists on the date of the certificate or
existed at any time during the period covered by such financial statements
any Default or Event of Default and, if any such condition or event exists
on the date of the certificate or existed during such period, specifying
the nature and extent thereof and the action the Company is taking, has
taken or proposes to take with respect thereto; provided further, that
such certificates as are delivered with respect to the period provided for
in paragraph (b) above, shall include a list of any changes in Restricted
Subsidiaries as at the end of such period;
(f) Accountants Certificates. Within the period provided in
paragraph (b) above, a certificate of the accountants who are reporting
upon such financial statements, stating that they have reviewed this
Agreement and, stating further, whether in making their audit such
accountants (1) have not become aware that the Company and the Restricted
Subsidiaries have failed to comply with the terms, covenants, provisions,
or conditions contained in Section 5 hereof and (2) have examined the
schedules to such reports or other certificates or documents containing
calculations of the financial covenants required to be performed or
observed pursuant to Sections 5.6 through 5.11 hereof, and in their
opinion, the information set forth in such schedules or other certificates
or documents is fairly stated in all material respects in relation to the
annual consolidated financial statements taken as a whole;
(g) ERISA Notices. Promptly upon learning of the occurrence of
any of the following, written notice thereof, describing the same and the
steps being taken by the Company or any Subsidiary affected with respect
thereto, and when known, any action taken or threatened by the Internal
Revenue Service, Department of Labor or the PBGC with respect thereto: (1)
a Reportable Event with respect to any Plan; (2) the institution of any
steps by the Company, any ERISA Affiliate, the PBGC or any other person to
terminate any Plan other than a "standard termination" under Section
4041(b) of ERISA; (3) the institution of any steps by the Company or any
ERISA Affiliate to withdraw from any Multiemployer Plan; (4) a "prohibited
transaction" within the meaning of Section 406 of ERISA in connection with
any Plan; or (5) any material increase in the contingent liability of the
Company or any subsidiary with respect to any post-retirement welfare
liability; and
(h) Requested Information. With reasonable promptness, such
other data and information as the Purchasers or any such Institutional
Holder may reasonably request, including, without limitation, such
financial or other information as any holder of the Notes or any Person
designated by such holder may reasonably determine as required to permit
such holder to comply with requirements of Rule 144A promulgated under the
Act in connection with the resale by it of the Notes.
Without limiting the foregoing, the Company will permit any Purchaser, so
long as such Purchaser is the holder of any Note, and each Institutional
Holder of the then outstanding Notes (or such agent(s) as either such
Purchaser or such Institutional Holder may designate) to visit and
inspect, under the Company's guidance, any of the properties of the
Company or any Restricted Subsidiary, and to examine all of their 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, employees, and independent public
accountants (and by this provision the Company authorizes such accountants
to discuss with any Purchaser the finances and affairs of the Company and
its Restricted Subsidiaries) all at such reasonable times and as often as
may be reasonably requested. The Company shall be required to pay or
reimburse any such Purchaser or any such Institutional Holder for
reasonable expenses which such Purchaser or any such Institutional Holder
may incur in connection with any such visitation or inspection occurring
at such time as any Event of Default shall have occurred and be
continuing.
All information which is furnished to or obtained by any holder of
Notes pursuant to this Section 5.15 or otherwise pursuant to this
Agreement shall, if so requested in writing by the Company, be received
and held in confidence unless or until the same has been publicly
disclosed by the Company; provided, however, nothing herein contained
shall limit or impair the right or obligation of any Institutional Holder
of the Notes to disclose such information: (a) to its auditors, attorneys,
employees or agents, (b) when required by any law, ordinance or
governmental order, regulation, rule, policy, investigation or any
regulatory authority request, (c) as may be required or appropriate in any
report, statement or testimony submitted to any municipal, state,
provincial or Federal regulatory body having or claiming to have
jurisdiction over such Institutional Holder or to the United States
National Association of Insurance Commissioners or similar organizations
or their successors, (d) which is publicly available or readily
ascertainable from public sources, or which is received by any
Institutional Holder of the Notes from a third Person who or which is not
bound to keep the same confidential, (e) in connection with any
proceeding, case or matter pending (or on its face purported to be
pending) before any court, tribunal, arbitration board or any governmental
agency, commission, authority, board or similar entity, (f) in connection
with the enforcement by an Institutional Holder of its rights under or in
respect of this Agreement or the Notes after the occurrence of a Default
or Event of Default, or (g) to the extent necessary in connection with any
contemplated transfer of any of the Notes by an Institutional Holder
thereof (it being understood and agreed that any such transferee which
purchases such Notes shall itself be bound by the terms and provisions
hereof.)
Section 6. Events of Default and Remedies Therefor.
Section 6.1 Events of Default. Any one or more of the following
shall constitute an "Event of Default" as the term is used herein:
(a) Default shall occur in the payment of interest on any Note
when the same shall have become due and such default shall continue for
more than five days; or
(b) Default shall occur in the making of any required
prepayment on any of the Notes as provided in Section 2; or
(c) Default shall occur in the making of any other payment of
the principal of any Note or the premium thereon at the expressed or any
accelerated maturity date or at any date fixed for prepayment; or
(d) Default shall be made in the payment of the principal of or
interest on Indebtedness for borrowed money of the Company or any
Restricted Subsidiary (other than the Notes) aggregating more than
$3,000,000 as and when the same shall become due and payable by the lapse
of time, by declaration, by call for redemption or otherwise, and such
default shall continue beyond the period of grace, if any, allowed with
respect thereto; or
(e) Default or the happening of any event shall occur under any
indentures, agreements or other instruments (other than the Agreement)
under which any Indebtedness for borrowed money of the Company or any
Restricted Subsidiary aggregating more than $3,000,000 may be issued and
such defaults or events shall continue for a period of time sufficient to
permit the acceleration of the maturity of such Indebtedness of the
Company or such Restricted Subsidiaries, as the case may be, outstanding
thereunder; or
(f) Default shall occur in the observance or performance of any
covenant or agreement contained in Section 5.6 through Section 5.11
hereof; or
(g) Default shall occur in the observance or performance of any
other provision of this Agreement which is not remedied or waived within
30 days after the chief executive officer or the chief operating officer
or the chief financial officer of the Company first has actual knowledge
of such default; or
(h) if any representation or warranty made by the Company
herein, or made by the Company in any statement or certificate furnished
by the Company or any Subsidiary in connection with the consummation of
the issuance and delivery of the Notes or furnished by the Company or any
Subsidiary pursuant hereto, is untrue in any material respect as of the
date of the issuance or making thereof; or
(i) final judgment or judgments for the payment of money
aggregating in excess of $1,000,000 is or are outstanding against the
Company or any Restricted Subsidiary or against any property or assets of
either and any one of such judgments has remained unpaid, unvacated,
unbonded or unstayed by appeal or otherwise for a period of 60 days from
the date of its entry; provided, however, that the existence of such
judgment or judgments shall not constitute an Event of Default if (1) the
aggregate amount of such judgment or judgments shall be fully covered by
insurance issued by financially sound and reputable insurers and (2)
within such 60 day period, the Company shall have caused such insurers to
provide the holders of the Notes with written confirmation that such
coverage (i) equals or exceeds the amount of such judgment or judgments
and (ii) is not being contested as to amount or coverage by such insurers;
or
(j) a custodian, receiver, liquidator or trustee of the Company
or any Principal Subsidiary, or of any of the property of either, is
appointed or takes possession and such appointment or possession remains
uncontested or in effect for more than 60 days; or the Company or any
Principal Subsidiary generally fails to pay its debts as they become due
or admits in writing its inability to pay its debts as they mature; or the
Company or any Principal Subsidiary is adjudicated bankrupt or insolvent;
or an order for relief is entered under the Federal Bankruptcy Code
against the Company or any Principal Subsidiary; or any of the material
property of either is sequestered by court order and the order remains in
effect for more than 60 days; or a petition is filed against the Company
or any Principal Subsidiary under any bankruptcy, reorganization,
arrangement, insolvency, readjustment of debt, dissolution or liquidation
law of any jurisdiction, whether now or subsequently in effect, and is not
stayed or dismissed within 60 days after filing; or
(k) the Company or any Principal Subsidiary files a petition in
voluntary bankruptcy or seeking relief under any provision of any
bankruptcy, reorganization, arrangement, insolvency, readjustment of debt,
dissolution or liquidation law of any jurisdiction, whether now or
subsequently in effect; or consents to the filing of any petition against
it under any such law; or consents to the appointment of or taking
possession by a custodian, receiver, trustee or liquidator of the Company,
any Principal Subsidiary, or any of the property of either.
Section 6.2. Notice to Holders. When any Event of Default
described in Section 6.1 has occurred, or if the holder of any Note or of
any other evidence of Indebtedness of the Company gives any notice or
takes any other action with respect to a claimed default, the Company
agrees to give notice within three business days of such event to all
holders of the Notes then outstanding.
Section 6.3 Acceleration of Maturities. When any Event of Default
described in paragraph (a), (b) or (c) of Section 6.1 has happened and is
continuing, any holder of any Note may, and when any Event of Default
described in paragraphs (d) through (i), inclusive, of Section 6.1 has
happened and is continuing, the holder or holders of 70% or more of the
principal amount of Notes at the time outstanding may, in addition to any
other rights and remedies available at law or in equity, by notice in
writing sent in the manner provided in Section 9.6 hereof to the Company,
declare the entire principal and all interest accrued on all Notes to be,
and all Notes shall thereupon become, forthwith due and payable, without
any presentment, demand, protest or other notice of any kind, all of which
are hereby expressly waived. When any Event of Default described in
paragraph (j) or (k) of Section 6.1 has occurred, then all outstanding
Notes shall immediately become due and payable without presentment, demand
or notice of any kind. Upon the Notes becoming due and payable as a
result of any Event of Default as aforesaid, the Company will forthwith
pay to the holders of the Notes the entire principal and interest accrued
on the Notes plus, to the extent not prohibited by law, an amount as
liquidated damages for the loss of the bargain evidenced hereby (and not
as a penalty) equal to the applicable Make-Whole Amount determined as of
the date on which the Notes shall so become due and payable. No course of
dealing on the part of any holder of the Notes nor any delay or failure on
the part of any holder of the Notes to exercise any right shall operate as
a waiver of such right or otherwise prejudice such holder's rights,
powers and remedies. The Company further agrees, to the extent permitted
by law, to pay to the holder or holders of the Notes all reasonable costs
and expenses incurred by them in the collection of any Notes upon any
default hereunder or thereon, including reasonable compensation to such
holder's or holders' attorneys for all services rendered in connection
therewith.
Section 6.4 Rescission of Acceleration. The provisions of Section
6.3 are subject to the condition that if the principal of and accrued
interest on all or any outstanding Notes have been declared immediately
due and payable by reason of the occurrence of any Event of Default
described in paragraphs (a) through (i), inclusive, of Section 6.1, the
holders of not less than 75% in aggregate principal amount of the Notes
then outstanding may, by written instrument filed with the Company,
rescind and annul such declaration and the consequences thereof; provided
that at the time such declaration is annulled and rescinded:
(a) no judgment or decree has been entered for the payment of
any monies due pursuant to the Notes or the Agreement;
(b) all arrears of interest on all the Notes and all other sums
payable under the Notes and under the Agreement (except any principal,
interest or premium on the Notes which has become due and payable solely
by reason of such declaration under Section 6.3) shall have been duly
paid; and
(c) each and every other Default and Event of Default shall
have been made good, cured or waived pursuant to Section 7.1;
and provided further that no such rescission and annulment shall extend to
or affect any subsequent Default or Event of Default or impair any right
consequent thereto.
Section 7. Amendments, Waivers And Consents
Section 7.1. Consent Required. Any term, covenant, agreement or
condition of this Agreement may, with the consent of the Company, be
amended or compliance therewith may be waived (either generally or in a
particular instance and either retroactively or prospectively), if the
Company shall have obtained the consent in writing of the holders of at
least 70% in aggregate principal amount of outstanding Notes; provided
that without the written consent of the holders of all of the Notes then
outstanding, no such amendment or waiver shall be effective (a) which will
change the time of payment (including any prepayment required by Section
2.1) of the principal of or the interest on any Note or reduce the
principal amount thereof or change the rate of interest thereon, or (b)
which will change any of the provisions with respect to optional
prepayments, or (c) which will change the percentage of holders of the
Notes required to consent to any such amendment or waiver of any of the
provisions of this Section 7 or Section 6.
Section 7.2. Effect of Amendment or Waiver. Any such amendment or
waiver shall apply equally to all of the holders of the Notes and shall be
binding upon them, upon each future holder of any Note and upon the
Company, whether or not such Note shall have been marked to indicate such
amendment or waiver. No such amendment or waiver shall extend to or
affect any obligation not expressly amended or waived or impair any right
consequent thereon.
Section 7.3 Solicitation of Holders. The Company will not
solicit, request or negotiate for or with respect to any proposed waiver
or amendment of any of the provisions of the Agreements or the Notes
unless each holder of the Notes shall be informed thereof by the Company
and shall be afforded the opportunity of considering the same and shall be
supplied by the Company with sufficient information to enable it to make
an informed decision with respect thereto. Executed or true and correct
copies of any waiver or amendment effected pursuant to the provisions of
Section 7.1 shall be delivered by the Company to each registered holder of
outstanding Notes following the date on which the same shall have been
executed and delivered by the holder or holders of the requisite
percentage of outstanding Notes. 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, to any holder of
the Notes as consideration for or as an inducement to the entering into by
any holder of the Notes of any waiver or amendment of any of the terms and
provisions of this Agreement unless such remuneration is concurrently
paid, on the same terms, ratably to the holders of all the Notes then
outstanding.
Section 8. Interpretation of Agreement; Definitions.
Section 8.1. Definitions. Unless the context otherwise requires,
the terms hereinafter set forth when used herein shall have the following
meanings and the following definitions shall be equally applicable to both
the singular and plural forms of any of the terms herein defined:
"Act" shall mean the Securities Act of 1933, as amended from time to
time.
"Affiliate" shall mean any Person (other than a Restricted
Subsidiary) (a) which directly or indirectly through one or more
intermediaries controls, or is controlled by, or is under common control
with, the Company, (b) which beneficially owns or holds 5% or more of any
class of the Voting Stock of the Company or (c) 5% or more of the Voting
Stock (or in the case of a Person which is not a corporation, 5% or more
of the equity interest) of which is beneficially owned or held by the
Company or a Subsidiary. The term "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 Stock, by contract or otherwise.
"Agreement" shall mean this Note Agreement.
"Capitalized Lease" shall mean any lease the obligation for Rentals
with respect to which is required to be capitalized on a balance sheet of
the lessee in accordance with GAAP.
"Capitalized Rentals" of any Person shall mean as of the date of any
determination the amount at which the aggregate Rentals due and to become
due under all Capitalized Leases under which such Person is a lessee would
be reflected as a liability on a consolidated balance sheet of such Person
and its subsidiaries prepared in accordance with GAAP.
"Company" shall mean Xxxxxxx Worldwide Associates, Inc., a Wisconsin
corporation, and any Person who succeeds to all, or substantially all, of
the assets and business of Xxxxxxx Worldwide Associates, Inc.
"Consolidated Current Debt" shall mean, without duplication, Current
Debt of the Company and its Restricted Subsidiaries determined on a
consolidated basis eliminating intercompany items.
"Consolidated Funded Debt" shall mean, without duplication, Funded
Debt of the Company and its Restricted Subsidiaries determined on a
consolidated basis eliminating intercompany items.
"Consolidated Net Income" for any period shall mean net income of the
Company, and its Restricted Subsidiaries from continuing operations
determined on a consolidated basis in accordance with GAAP consistently
applied, and excluding net earnings and losses of any Person (other than a
Restricted Subsidiary) with which the Company or a Restricted Subsidiary
shall have consolidated or which shall have merged or liquidated into or
with the Company or a Restricted Subsidiary prior to the date of such
consolidation, merger or liquidation.
"Consolidated Net Worth" shall mean as of the date of any
determination thereof the amount of the par or stated value of all
outstanding capital stock, capital surplus, and retained earnings of the
Company and its Restricted Subsidiaries, net of all cumulative translation
adjustments and contingent compensation adjustments determined on a
consolidated basis in accordance with GAAP.
"Consolidated Tangible Assets" shall mean as of the date of any
determination thereof the total amount of all Tangible Assets of the
Company and its Restricted Subsidiaries on a consolidated basis after
deducting therefrom all Investments incurred pursuant to and within the
limitations of Section 5.11(i).
"Consolidated Tangible Net Worth" shall mean as of the date of any
determination thereof Consolidated Net Worth less (a) all assets of the
Company and its Restricted Subsidiaries that are properly classified as
"intangible assets" all determined in accordance with GAAP and (b) all
Investments incurred pursuant to and within the limitations of Section
5.11(i).
"Consolidated Tangible Net Worth Available for Investments" shall
mean as of the date of any determination thereof the sum of (a)
Consolidated Tangible Net Worth and (b) all Investments incurred pursuant
to and within the limitations of Section 5.11(i) hereof.
"Consolidated Total Assets" of the Company and its Restricted
Subsidiaries shall mean as of the date of any determination thereof the
total assets of the Company and its Restricted Subsidiaries as of such
date determined on a consolidated basis in accordance with GAAP.
"Consolidated Total Capitalization" shall mean as of the date of any
determination thereof the sum of (a) Consolidated Net Worth and (b)
Consolidated Funded Debt.
"Current Debt" of any Person shall mean as of the date of any
determination thereof (a) all Indebtedness for borrowed money or which has
been incurred in connection with the acquisition of property or assets
other than Funded Debt, provided that any portion of such obligations
incurred in connection with the acquisition of property or assets
specifically including, without limitation, obligations which have been
incurred by such Person in connection with any sale, transfer or issuance
of stock pursuant to and in compliance with Section 5.8(c)(5) and which
are at the date of any determination of Current Debt contingent as to
amount or as to payment shall not be treated as Current Debt on such date,
(b) Guaranties of Current Debt of others and (c) all obligations of such
Person with respect to receivables sold or otherwise discounted with
recourse which would not constitute Funded Debt pursuant to the terms of
the definition thereof.
"Default" shall mean any event or condition the occurrence of which
would, with the lapse of time or the giving of notice, or both, constitute
an Event of Default.
"Domestic Restricted Subsidiary" shall mean any Restricted Subsidiary
(a) which is organized under the laws of the United States or any State
thereof and (b) which conducts substantially all of its business and has
substantially all of its assets within the United States.
"Eighty Percent-Owned Restricted Subsidiary" shall mean a Subsidiary
of which 80% or more (by number of votes) of the Voting Stock shall be
beneficially owned, directly or indirectly, by the Company.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended, and any successor statute of similar import, together
with the regulations thereunder, in each case as in effect from time to
time. References to sections of ERISA shall be construed to also refer to
any successor sections.
"ERISA Affiliate" shall mean any corporation, trade or business that
is, along with the Company, a member of a controlled group of corporations
or a controlled group of trades or businesses, as described in Section
414(b) and 414(c), respectively, of the Internal Revenue Code of 1986, as
amended or Section 4001 of ERISA.
"Event of Default" is defined in Section 6.1.
"Funded Debt" of any Person shall mean (a) all Indebtedness for or in
respect of borrowed money or which has been incurred in connection with
the acquisition of property or assets, in each case having a final
maturity of more than one year from the date of origin thereof (or which
is renewable or extendible at the option of the obligor for a period or
periods of more than one year from the date of origin), including all
payments in respect thereof that are required to be made within one year
from the date of any determination of Funded Debt, whether or not the
obligation to make such payment shall constitute a current liability of
the obligor under GAAP, provided that any portion of such obligations
incurred in connection with the acquisition of property or assets
specifically including, without limitation, obligations which have been
incurred by such Person in connection with any sale, transfer or issuance
of capital stock pursuant to and in compliance with Section 5.8(c)(5) and
which are at the date of any determination of Funded Debt contingent as to
amount or as to payment shall not be treated as Funded Debt on such date,
(b) all Capitalized Rentals, (c) all Guaranties by such Person of Funded
Debt of others and (d) all obligations of such Person with respect to
receivables sold or otherwise discounted with recourse.
"GAAP" shall mean United States generally accepted accounting
principles as in effect from time to time. Notwithstanding the foregoing,
in the event that any Accounting Changes (as defined below) shall occur,
all financial covenants, standards and terms in this Agreement shall
continue to be calculated or construed as if such Accounting Changes had
not occurred. "Accounting Changes" means: changes in accounting
principles required by the promulgation of any rule, regulation,
pronouncement or opinion by the Financial Accounting Standards Board or
the American Institute of Certified Public Accountants or, if applicable,
the Securities and Exchange Commission (or successors thereto or agencies
with similar functions).
"Guaranties" by any Person shall mean all obligations (other than
endorsements 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 (the "primary obligor") in any manner, whether directly or
indirectly, including, without limitation, all obligations incurred
through an agreement, contingent or otherwise, by such Person: (a) to
purchase such Indebtedness or obligation or any property or assets
constituting security therefor, (b) to advance or supply funds (1) for the
purchase or payment of such Indebtedness or obligation, (2) to maintain
working capital or other balance sheet condition or otherwise to advance
or make available funds for the purchase or payment of such Indebtedness
or obligation, or (c) to lease property or to purchase Securities or other
property or services primarily for the purpose of assuring the owner of
such Indebtedness or obligation of the ability of the primary obligor to
make payment of the Indebtedness or obligation, or (d) otherwise to assure
the owner of the Indebtedness or obligation of the primary obligor against
loss in respect thereof. For the purposes of all computations made under
this Agreement, a Guaranty in respect of any Indebtedness for borrowed
money shall be deemed to be Indebtedness equal to the principal amount of
such Indebtedness for borrowed money which has been guaranteed, and a
Guaranty in respect of any other obligation or any dividend shall be
deemed to be Indebtedness equal to the maximum aggregate amount of such
obligation or dividend.
"Indebtedness" of any Person shall mean and include (a) obligations
of such Person for borrowed money or which have been incurred in
connection with the acquisition of property or assets (except for
obligations under bona fide employment, consulting, non-competition, lease
and similar agreements), provided that any portion of such obligations
which have been incurred in connection with the acquisition of property or
assets specifically including, without limitation, obligations which have
been incurred by such Person in connection with any sale, transfer or
issuance of stock pursuant to and in compliance with Section 5.8(c)(5) and
which are at the date of any determination of Indebtedness contingent as
to amount or as to payment shall not be treated as Indebtedness on such
date, (b) obligations secured by any Lien upon property or assets owned by
such Person, even though such Person has not assumed or become liable for
the payment of such obligations, (c) obligations created or arising under
any conditional sale or other title retention agreement with respect to
property acquired by such Person, notwithstanding the fact that the rights
and remedies of the seller, lender or lessor under such agreement in the
event of default are limited to repossession or sale of property, (d) all
Guaranties by such Person of obligations of others of the character
referred to in this definition, (e) Capitalized Rentals, and (f) all
obligations of such Person with respect to receivables sold or otherwise
discounted with recourse.
"Institutional Holder" shall mean any of the following Persons: (a)
any bank or any savings and loan association, savings institution, trust
company or other institution acting for its own account or in a fiduciary
capacity, (b) any insurance company, (c) any pension, retirement or profit
sharing trust or fund within the meaning of Title I of ERISA or for which
any bank, trust company, national banking association or investment
adviser registered under the Investment Advisers Act of 1940, as amended,
is acting as trustee or agent, (d) any investment company or business
development company, as defined in the Investment Company Act of 1940, as
amended, (e) any broker or dealer registered under the Securities Exchange
Act of 1934, as amended, who is a member of a national securities exchange
or any investment adviser registered under the Investment Adviser Act of
1940, as amended, (f) any government, any public employees' pension or
retirement system, or any other governmental agency supervising the
investment of public funds, (g) any other entity all of the equity owners
of which are Institutional Holders or (h) any other Person which may be
within the definition of "qualified institutional buyer" as such term is
used in Rule 144A, as from time to time in effect, promulgated under the
Act.
"Investments" of any Person shall mean all investments, in cash or by
delivery of property made, directly or indirectly in any Person, whether
by acquisition of shares of capital stock, indebtedness or any other
obligations or Securities or by loan, advance, capital contributions or
otherwise.
"Lien" shall mean any interest in property securing an obligation
owed to, or a claim by, a Person other than the owner of the property,
whether such interest is based on the common law, statute or contract,
including, without limitation, the security interest arising from a
mortgage, encumbrance, pledge, conditional sale or trust receipt or a
lease, consignment or bailment for security purposes and including any
Capitalized Lease. The term "Lien" shall include reservations,
exceptions, encroachments, easements, rights-of-way, covenants,
conditions, restrictions, lease and other similar title exceptions and
encumbrances affecting real property. For the purpose of this Agreement,
the Company or a Restricted Subsidiary shall be deemed to be the owner of
any property which it has acquired or holds subject to a conditional sale
agreement or other arrangement pursuant to which title to the property has
been retained by or vested in another Person for security purposes.
"Make-Whole Amount" shall mean with respect to any amounts to be paid
pursuant to the provisions of Sections 2.2 or 2.3 hereof or upon
acceleration of the Notes the excess, if any, of (1) the aggregate present
value as of the date of such prepayment or payment of each dollar of
principal being prepaid or paid (taking into account the application of
such prepayment required by Section 2.1) and the amount of interest
(exclusive of interest accrued to the date of prepayment or payment) that
would have been payable in respect of such dollar if such prepayment or
payment had not been made, determined by discounting such amounts at the
Reinvestment Rate from the respective dates on which they would have been
payable, over (2) 100% of the principal amount of the outstanding Notes
being prepaid or paid. If the Reinvestment Rate with respect to
prepayment of (a) the Series A Notes is equal to or higher than 7.77%, or
(b) the Series B Notes is equal to or higher than 6.98%, the Make-Whole
Amount shall be zero. For purposes of any determination of the Make-Whole
Amount:
"Reinvestment Rate" shall mean as of the time of any determination
thereof .50% plus the yield on actively traded U.S. Treasury Securities
with a maturity corresponding to the Weighted Average Life to Maturity of
the principal then being prepaid or paid (taking into account the
application of any such prepayment required by Section 2.1) as set forth
on page Government C4 (or any successor page) of the Bloomberg screen or,
if such page or screen is not available at the time of any determination
hereunder, then such other reasonably comparable index which shall be
designated by the holders of 66-2/3% in aggregate principal amount of the
outstanding Notes. If no maturity exactly corresponds to such Weighted
Average Life to Maturity, yields for the two published maturities most
closely corresponding to such Weighted Average Life to Maturity shall be
calculated pursuant to the immediately preceding sentence and the
Reinvestment Rate shall be interpolated or extrapolated from such yields
on a straight-line basis, rounding in each of such relevant periods to the
nearest month.
"Weighted Average Life to Maturity" of the principal amount of the
Series of Notes being prepaid or paid shall mean, as of the time of any
determination thereof, the number of years obtained by dividing the then
Remaining Dollar-Years of such principal by the aggregate amount of such
principal. The term "Remaining Dollar-Years" of such principal shall mean
the amount obtained by (a) multiplying (1) the remainder of (i) the amount
of principal that would have become due on each scheduled prepayment or
payment date if such prepayment or payment had not been made less (ii) the
amount of principal on the Notes scheduled to become due on such date
after giving effect to such prepayment or payment and the application
thereof in accordance with the provisions of Section 2.1, by (2) the
number of years (calculated to the nearest one-twelfth) which will elapse
between the date of determination and such scheduled prepayment or payment
date, and (b) totaling the products obtained in (a).
"Multiemployer Plan" shall have the meaning as in ERISA.
"Overdue Rate" shall mean (i) with respect to the Series A Notes as
of the date of any determination thereof the lesser of (a) the maximum
rate permitted by law and (b) 9.77% per annum and (ii) with respect to the
Series B Notes as of the date of any determination thereof the lesser of
(a) the maximum rate permitted by law and (b) 8.98% per annum.
"PBGC" shall mean the Pension Benefit Guaranty Corporation and any
entity succeeding to any or all of its functions under ERISA.
"Person" shall mean an individual, partnership, corporation, trust or
unincorporated organization, and a government or agency or political
subdivision thereof.
"Plan" shall mean a plan that is both a "pension plan," as such term
is defined in Section 3(2) of ERISA, and a "defined benefit pension plan"
as defined in Section 414(j) of the Internal Revenue Code of 1986 which is
established or maintained by the Company or any ERISA Affiliate or as to
which the Company or any ERISA Affiliate contributed or is a member or
otherwise may have any liability.
"Principal Subsidiary" shall mean any Restricted Subsidiary which had
(a) total assets, on a consolidating basis, as of the last day of the most
recently ended fiscal quarter of the Company, of an amount equal to or
greater than 2% of Consolidated Total Assets of the Company as of the last
day of such fiscal quarter, or (b) net income, on a consolidating basis,
for the Company's most recent fiscal year, equal to or greater than 2% of
Consolidated Net Income of the Company for such year.
"Rentals" of any Person shall mean and include all fixed rents
(including as such all payments which the lessee is obligated to make to
the lessor on termination of the lease or surrender of the property)
payable by such Person, as lessee or sublessee under a lease of real or
personal property, but shall be exclusive of any amounts required to be
paid by such Person (whether or not designated as rents or additional
rents) on account of maintenance, repairs, insurance, taxes and similar
charges. Fixed rents under any so-called "percentage leases" shall be
computed solely on the basis of the minimum rents, if any, required to be
paid by the lessee regardless of sales volume or gross revenues.
"Reportable Event" shall have the same meaning as in ERISA.
"Restricted Subsidiary" shall mean any Subsidiary of which more than
50% (by number of votes) of the Voting Stock is beneficially owned,
directly or indirectly, by the Company.
"Security" shall have the same meaning as in Section 2(l) of the
Securities Act of 1933, as amended.
The term "subsidiary" shall mean, as to any particular parent
corporation, any corporation of which more than 50% (by number of votes)
of the Voting Stock shall be owned by such parent corporation and/or one
or more corporations which are themselves subsidiaries of such parent
corporation. The term "Subsidiary" shall mean a subsidiary of the
Company.
"Tangible Assets" of any Person shall mean, as of the date of any
determination thereof, the total amount of all assets of such Person (less
depreciation, depletion, and other properly deductible valuation reserves)
after deducting the following: good will, patents, trade names, trade
marks, copyrights, franchises, experimental expense, organization expense,
unamortized debt discount and expense, deferred charges, the excess of
cost of shares acquired over book value of related assets, any write up in
the book value of any asset resulting from a revaluation thereof
subsequent to March 29, 1991 (except in connection with the acquisition of
such assets) and such other assets as are properly classified as
"intangible assets" in accordance with GAAP.
"Voting Stock" shall mean Securities of any class or classes, the
holders of which are ordinarily, in the absence of contingencies, entitled
to elect a majority of the corporate directors (or Persons performing
similar functions).
"Wholly-owned" when used in connection with any Subsidiary shall mean
a Subsidiary of which all of the issued and outstanding shares of stock
(other than directors' qualifying shares or shares owned by foreign
domiciliaries as required by law) shall be owned by the Company and/or one
or more of its Wholly-Owned Restricted Subsidiaries.
Section 8.2. Accounting Principles. Where the character or amount
of any asset or liability or item of income or expense is required to be
determined or any consolidation or other accounting computation is
required to be made for the purposes of this Agreement, the same shall be
done in accordance with GAAP, to the extent applicable, except where such
principles are inconsistent with the specific provisions of this
Agreement.
Section 8.3. Directly or Indirectly. Where any provision in this
Agreement refers to action to be taken by any Person, or which such Person
is prohibited from taking, such provision shall be applicable whether the
action in question is taken directly or indirectly by such Person.
Section 9. Miscellaneous
Section 9.1. Registration of Notes. The Company shall cause to be
kept at its principal office a register for the registration and transfer
of the Notes (hereinafter called the "Note Register"), and the Company
will register or transfer or cause to be registered or transferred, as
hereinafter provided any Note issued pursuant to this Agreement.
The Person in whose name any registered Note shall be registered
shall be deemed and treated as the owner and holder thereof for all
purposes of this Agreement. Payment of or on account of the principal,
premium, if any, and interest on any registered Note shall be made to or
upon the written order of such registered holder.
Section 9.2. Exchange of Notes. At any time and from time to time,
upon not less than ten days' notice to that effect given by the holder of
any Note initially delivered or of any Note substituted therefor pursuant
to Section 9.1, this Section 9.2 or Section 9.3, and upon surrender of
such Note at its office, the Company will deliver in exchange therefor,
without expense to the holder, except as set forth below, Notes of the
same Series, in registered form, for the same aggregate principal amount
as the then unpaid principal amount of the Note so surrendered, in the
denomination of $3,000,000 or any multiple of $100,000 in excess thereof
as such holder shall specify, dated as of the date to which interest has
been paid on the Note so surrendered or, if such surrender is prior to the
payment of any interest thereon, then dated as of the date of issue,
payable to such Person or Persons, as may be designated by such holder,
and otherwise of the same form and tenor as the Notes so surrendered for
exchange; provided that, notwithstanding the foregoing, any Note issued on
the Closing Date or any Note substituted therefor in a denomination of
less than $3,000,000 may be exchanged in whole by any holder thereof.
Section 9.3. Loss, Theft, Etc. of Notes. Upon receipt of evidence
satisfactory to the Company of the loss, theft, mutilation or destruction
of any Note, and in the case of any such loss, theft or destruction upon
delivery of a bond or indemnity in such form and amount as shall be
reasonably satisfactory to the Company, or in the event of such mutilation
upon surrender and cancellation of the Note, the Company will make and
deliver, without expense to the holder thereof, a new Note, of like tenor,
in lieu of such lost, stolen, destroyed or mutilated Note. If the
Purchaser or any subsequent Institutional Holder is the owner of any such
lost, stolen or destroyed Note, then the affidavit of an authorized
officer of such owner, setting forth the fact of loss, theft or
destruction and of its ownership of the Note at the time of such loss,
theft or destruction, shall be accepted as satisfactory evidence thereof
and no further indemnity shall be required as a condition to the execution
and delivery of a new Note other than the written agreement of such owner
to indemnify the Company.
Section 9.4. Expenses, Stamp Tax Indemnity. Whether or not the
transactions herein contemplated shall be consummated, the Company agrees
to pay directly all reasonable costs and expenses in connection with the
preparation, execution and delivery of this Agreement and the transactions
contemplated hereby, including but not limited to all investment banking
and similar fees, the reasonable charges and disbursements of Xxxxxxx and
Xxxxxx, special counsel to the Purchasers, duplicating and printing costs
and charges for shipping the Notes, adequately insured to each Purchaser's
home office or at such other place as such Purchaser may designate, and
all reasonable out-of-pocket costs and expenses relating to any
amendments, waivers or consents pursuant to the provisions hereof (whether
or not the same are actually executed and delivered), including, without
limitation, any amendments, waivers or consents resulting from any
work-out, renegotiation or restructuring relating to the performance by
the Company of its obligations under this Agreement and the Notes. The
Company also agrees that it will pay and save each Purchaser harmless
against any and all liability with respect to obtaining so-called "private
placement numbers" for the Notes from Standard & Poor's Corporation in
accordance with the requirements of the National Association of Insurance
Commissioners and with respect to stamp and other taxes, if any, which may
be payable or which may be determined to be payable in connection with the
execution and delivery of this Agreement or the initial issuance of the
Notes, whether or not any Notes are then outstanding. The Company agrees
to protect and indemnify each Purchaser against any liability for any and
all brokerage fees and commissions payable or claimed to be payable to any
Person in connection with the transactions contemplated by this Agreement,
other than any such fees or commissions claimed by any Person engaged by
such Purchaser. Each Purchaser hereby represents to the Company that no
broker or finder was employed or retained by it in connection with its
purchase of the Notes.
Section 9.5. Powers and Rights Not Waived; Remedies Cumulative. No
delay or failure on the part of the holder of any Note in the exercise of
any power or right shall operate as a waiver thereof; nor shall any single
or partial exercise of the same preclude any other or further exercise
thereof, or the exercise of any other power or right, and the rights and
remedies of the holder of any Note are cumulative to and are not exclusive
of any rights or remedies any such holder would otherwise have, and no
waiver or consent, given or extended pursuant to Section 7, shall extend
to or affect any obligation or right not expressly waived or consented to.
Section 9.6. Notices. All communications provided for hereunder
shall be in writing and, if to the Purchasers, delivered or mailed by
overnight courier or by facsimile communication, in each case addressed to
each Purchaser at such Purchaser's address appearing on Schedule I to this
Agreement or such other address as such Purchaser or the subsequent holder
of any Note initially issued to such Purchaser may designate to the
Company in writing, and, if to the Company, delivered or mailed by prepaid
overnight courier or by facsimile communication to the Company at the
address specified on page 1 hereof, Attention: Treasurer, or to such other
address as the Company may in writing designate to the Purchasers or to a
subsequent holder of the Note initially issued to the Purchasers;
provided, however, that a notice to you by overnight courier shall only be
effective if delivered to you at a street address designated for such
purpose in Schedule I attached hereto, and a notice to the Purchasers by
facsimile communication shall only be effective if confirmed by prepaid
overnight courier, or, in either case, as each Purchaser or a subsequent
holder of any Note initially issued to such Purchaser may designate to the
Company in writing.
Section 9.7. Successors and Assigns. This Agreement shall be
binding upon the Company and its successors and assigns and shall inure to
the benefit of each Purchaser and to the benefit of its successors and
assigns, including each successive holder or holders of any Notes;
provided, however, that notwithstanding any other provisions of this
Agreement or the Notes, the Notes shall not be transferable to any Person
that is not an Institutional Holder.
Section 9.8. Survival of Covenants and Representations. All
covenants, representations and warranties made by the Company herein and
in any certificates delivered pursuant hereto, whether or not in
connection with the Closing Date, shall survive the closing and the
delivery of this Agreement and the Notes.
Section 9.9. Severability. Should any part of this Agreement for
any reason be declared invalid by a court of competent jurisdiction, such
decision shall not affect the validity of any remaining portion, which
remaining portion shall remain in force and effect as if this Agreement
had been executed with the invalid portion thereof eliminated and it is
hereby declared the intention of the parties hereto that they would have
executed the remaining portion of this Agreement without including therein
any such part which may, for any reason, be declared invalid.
Section 9.10. Reproduction of Documents. This Agreement and all
documents relating thereto, including without limitation, (a) consents,
waivers and modifications which may hereafter be executed, (b) documents
received by the Purchasers at the closing of their respective purchases of
the Notes (except the Notes themselves), and (c) financial statements,
certificates and other information previously or hereafter furnished to
the Purchasers, may be reproduced by the Purchasers by any photographic,
photostatic, microfilm, micro-card, miniature photographic or other
similar process and each such Purchaser may destroy any original document
so reproduced. The Company agrees and stipulates that 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 such Purchaser
in the regular course of business) and that any enlargement, facsimile or
further reproduction of such reproduction shall likewise be admissible in
evidence.
Section 9.11. Governing Law. This Agreement and the Notes issued
and sold hereunder shall be governed by and construed in accordance with
Illinois law. Notwithstanding the preceding sentence, nothing in this
Agreement shall be construed to subject the holder of any Notes that is an
insurance company to the laws of the State of Illinois.
Section 9.12. Submission of Jurisdiction; Waiver of Jury Trial. (a)
Any legal action or proceeding with respect to this Agreement or the Notes
or any document related thereto shall be brought in the courts of the
State of Illinois or of the United States of America for the Northern
District of Illinois and in no other courts, and, by execution and
delivery of this Agreement, the Company hereby accepts for itself and in
respect of its property, generally and unconditionally, the jurisdiction
of the aforesaid courts. The Company hereby irrevocably and
unconditionally waives any objection, including, without limitation, any
objection to the laying of venue or based on the grounds of forum non
conveniens, which it may now or hereafter have to the bringing of any
action or proceeding in such respective jurisdictions.
(b) The Company and the Purchasers each hereby irrevocably and
unconditionally waive trial by jury.
Section 9.13. Captions. The descriptive headings of the various
Sections or parts of this Agreement are for convenience only and shall not
affect the meaning or construction of any of the provisions hereof.
The execution hereof by the Purchasers shall constitute a contract
between us for the uses and purposes hereinabove set forth, and this
Agreement may be executed in any number of counterparts, each executed
counterpart constituting an original but all together only one agreement.
Xxxxxxx Worldwide Associates, Inc.
By: /s/ Xxxx X. Xxxxxxx
Its: Senior Vice President & CFO
Accepted as of the first date written above.
Nationwide Life Insurance Company
By: /s/ Xxxxx Xxxxxxxx
Its: Vice President
Equity Securities
Accepted as of the first date written above.
Employers Life Insurance Company of Wausau
By: /s/ Xxxxx X. Xxxxxxxx
Its: Attorney-in-Fact
Accepted as of the first date written above.
Great-West Life & Annuity Insurance Company
By: /s/ Xxxxx X. Xxxxxx
Its: Assistant Vice President
Private Placement Investments
By: /s/ Xxxxx X. Xxxx
Its: Manager
Private Placement Investments
Schedule I (to Note Agreement)
Names and Addresses of Purchasers
Principal Amount
Name and Addresses of Series A Notes to Be
of Purchasers Purchased
Nationwide Life Insurance Company $27,000,000
Xxx Xxxxxxxxxx Xxxxx
Xxxxxxxx, Xxxx 00000-0000
Telecopier Number: (000) 000-0000
Payments
All payments on or in respect of the Series A Notes to be by bank wire
transfer of Federal or other immediately available funds (identifying each
payment as "Xxxxxxx Worldwide Associates, Inc., 7.77% Senior Notes, Series
A due 2005, PPN 479254 A @ 3, principal or interest") to:
Xxxxxx Guaranty Trust Company of New York (ABA #021-000-238)
JOURNAL #000-00-000
For the account of Nationwide Life Insurance
Company Custody Account #71615
Attention: Custody Service Department
Notices
All notices of payment on or in respect of the Series A Notes and written
confirmation of each such payment to:
Nationwide Life Insurance Company
Xxx Xxxxxxxxxx Xxxxx-0-00-00
Xxxxxxxx, Xxxx 00000-0000
Attention: Corporate Money Management
All notices and communications other than those in respect to payments to
be addressed:
Nationwide Life Insurance Company
Xxx Xxxxxxxxxx Xxxxx-0-00-00
Xxxxxxxx, Xxxx 00000-0000
Attention: Corporate Fixed-Income Securities
Telecopier Number: (000) 000-0000
Name of Nominee in which Series A Notes are to be issued: None
Taxpayer I.D. Number: 00-0000000
Principal Amount
Name and Addresses of Series A Notes to Be
of Purchasers Purchased
Employers Life Insurance Company of Wausau $3,000,000
0000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxx 00000
Payments
All payments on or in respect of the Series A Notes to be by bank wire
transfer of Federal or other immediately available funds (identifying each
payment as "Xxxxxxx Worldwide Associates, Inc., 7.77% Senior Notes, Series
A due 2005, PPN 479254 A @ 3, principal or interest") to:
Xxxxxx Guaranty Trust Company of New York (ABA #021-000-238)
JOURNAL #000-00-000
F/A/O Employers Life Custody
Account Number 50135
Attention: Custody Service Department
Notices
All notices of payment, on or in respect of the Series A Notes, and
written confirmation of each such payment to be addressed as first
provided above.
All notices and communications other than those in respect to payments to
be addressed:
Employers Life Insurance Company of Wausau
Xxx Xxxxxxxxxx Xxxxx-0-00-00
Xxxxxxxx, Xxxx 00000-0000
Attention: Corporate Fixed-Income Securities
Name of Nominee in which Series A Notes are to be issued: None
Taxpayer I.D. Number: 00-0000000
Principal Amount
Name and Address of Series B Notes
of Purchaser to be Purchased
Great-West Life & Annuity Insurance Company $15,000,000
0000 Xxxx Xxxxxxx Xxxx, 0xx xxxxx, Xxxxx 0
Xxxxxxxxx, Xxxxxxxx 00000
Attention: U.S. Private Placements
Facsimile: (000) 000-0000
Payments
All payments on or in respect of the Series B Notes to be by bank wire
transfer of Federal or other immediately available funds (identifying each
payment as "Xxxxxxx Worldwide Associates, Inc., 6.98% Senior Notes, Series
B due 2005, PPN 479254 B* 4, principal or interest and confirmation of
principal balance") to:
NW MPLS/TRUST CLEARING
ABA #000000000
Account Number 00-00-000
Attention: GWL for Account Number 00000000
Notices
All notices of payments, on or in respect of the Series B Notes and
written confirmation of each such payment to:
Norwest Bank Minnesota, N.A.
000 Xxxxxxxxx Xxxxxx, Xxxxxxxxx Building, 0xx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000-0000
Attention: Income Collections
All notices and communications other than those in respect to payments to
be addressed as first provided above.
Name of Nominee in which Series B Notes are to be issued: None
Taxpayer I.D. Number: 00-0000000
Schedule II (to Note Agreement)
Subsidiaries of the Company
The following lists the direct and indirect subsidiaries of Xxxxxxx
Worldwide Associates, Inc. as of June 15, 1995:
Jurisdiction in Which
Name of Subsidiary(1)(2) Incorporated
America Outdoors, Inc.
("Crappiethon U.S.A.") Alabama
Jack Wolfskin International Ltd. (in
liquidation) United Kingdom
Xxxx Wolfskin Adventure Equipment Ltd. United Kingdom
Old Town Canoe Company Delaware
Xxxxxxx Worldwide Associates Canada Inc. Canada
Xxxxxxx Fishing, Inc. (inactive) Delaware
Xxxxxxxx Sports S.A. France
Xxxxxxxx France, S.A. France
Distribution Moderne Xx Xxxxxxx(4) France
Xxxxxxxx Xxxxxxx XX Xxxxxxx
Xxxxxxxx XX Xxxxxx Xxxxxxx
Plastimo Manufacturing (UK) Ltd.(3) United Kingdom
Plastimo, S.A. France
Plastimo Espana SA Spain
Plastimo Nordic AB Sweden
Scubapro Sweden AB Sweden
Plastimo Holland BV Netherlands
Seaco/Elliot, Inc. (inactive) Delaware
Airguide Instrument Company Illinois
Under Sea Industries, Inc. Delaware
Hydro Rubber and Plastic, Inc. (in liquidation) California
Scubapro Europe Benelux(3) Belgium
Scubapro Taucherausrustungen Gesellschaft GmbH Austria
Scubapro Espana, S.A. (4) Spain
Scubapro Eu AG Switzerland
Scubapro (UK) Ltd.(3) United Kingdom
Diving Locker U.K., Ltd. United Kingdom
Xxxxxxx Beteiligungsgesellschaft mbH Germany
Xxxxxxx Outdoors V mbH Germany
Scubapro Taucherauser GmbH Germany
Xxxx Wolfskin Ausruestung fuer Draussen GmbH Germany
Scubapro Europe S.R.L. Italy
Scubapro Italy S.R.L. Italy
Scubapro Asia, Ltd. Japan
Scubapro Norge AS Norway
Xxxxxxx Worldwide Associates Australia Pty. Ltd. Australia
Xxxxxxx Leisure Incentives, Inc. (inactive) Delaware
Porelon, Inc. (inactive) Delaware
Microfoam, Inc. (inactive) New York
Phoenix Endeavour, Inc. (inactive) California
(1) Unless otherwise indicated, each company does business only under its
legal name.
(2) Unless otherwise indicated by footnote, each company is a
wholly-owned subsidiary of Xxxxxxx Worldwide Associates, Inc.
(through direct or indirect ownership).
(3) Percentage of stock owned is 99%.
(4) Percentage of stock owned is 98%.
Description of Debt and Leases
as of June 30, 1995
($000's omitted, U.S. Dollars)
1. Current Debt for borrowed money of the Company and its Restricted
Subsidiaries is as follows:
Xxxxxxx Worldwide Associates, Inc. $ 48,594
Xxxx Wolfskin Ausrustung fur Draussen 3,787
GmbH
Xxxxxxx Outdoors V mbH 188
Xxxxxxx Worldwide Associates Canada 2,724
Inc.
Xxxxxxxx Sports, S.A. 4,700
Xxxxxxxx France, S.A. 1,056
Distribution Moderne Xx Xxxxxxx 1,634
Plastimo, S.A. 3,369
Scubapro Asia, Ltd. 1,195
Xxxxxxx Worldwide Associates Australia 307
Pty. Ltd.
Scubapro Europe Benelux 39
Scubapro Italy S.R.L. 1,091
Scubapro Sweden AB 193
Scubapro (UK) Ltd. 319
Xxxx Wolfskin Adventure Equipment Ltd. 931
------
Total Current Debt for borrowed money $70,127
======
2. Funded Debt for borrowed money (including Capitalized Leases and
Guarantees relating to the obligations of persons other than the
Company and its Restricted Subsidiaries) of the Company and its
Restricted Subsidiaries is as follows:
Xxxxxxx Worldwide Associates, Inc. $35,000
Xxxxxxxx Sports, S.A. 2,119
Plastimo, S.A. 41
Scubapro Asia, Ltd. 17
Scubapro Europe Benelux 207
------
Total Funded Debt for borrowed money $37,384
=======
3. Capitalized Leases of the Company and its Restricted Subsidiaries
outstanding on the Closing Date are as follows:
None
4. Guaranties of the Company and its Restricted Subsidiaries relating to
the obligations of Persons other than the Company and its Restricted
Subsidiaries outstanding on the Closing Date are as follows:
None
5. Liens existing as of the date of this Agreement securing Indebtedness
of the Company or any Restricted Subsidiary outstanding on such date:
None
EXHIBIT A-1 (to Note Agreement)
Xxxxxxx Worldwide Associates, Inc.
7.77% Senior Note, Series A
Due October 15, 2005
PPN 479254 A@ 3
No. R-
____________, 1995
$
Xxxxxxx Worldwide Associates, Inc., a Wisconsin corporation (the
"Company"), for value received, hereby promises to pay to
or registered assigns
on the fifteenth day of October, 2005
the principal amount of
Dollars ($_________)
and to pay interest (computed on the basis of a 360-day year of twelve
30-day months) on the principal amount from time to time remaining unpaid
hereon at the rate of 7.77% per annum from the date hereof until maturity,
payable semiannually on the fifteenth day of each October and April in
each year commencing April 15, 1996, and at maturity. The Company agrees
to pay interest on overdue principal (including any overdue optional
prepayment of principal) and Make-Whole Amount, if any, and (to the extent
legally enforceable) on any overdue installment of interest, at the
Overdue Rate after the due date thereof, whether by acceleration or
otherwise, until paid. "Overdue Rate" means the lesser of (a) the maximum
rate permitted by law or (b) 9.77%.
Except as provided in Section 2.6 of the Note Agreement (as hereinafter
defined), both the principal hereof and interest hereon are payable at the
principal office of the Company in Racine, Wisconsin, in coin or currency
of the United States of America which at the time of payment shall be
legal tender for the payment of public and private debts. If any amount
of principal, Make-Whole Amount, if any, or interest on or in respect of
this Note becomes due and payable on any date which is not a business day
in Xxx Xxxx, Xxx Xxxx, Xxxxxxx, Xxxxxxxx and Racine, Wisconsin, such
amount shall be payable on the next preceding business day.
This Note is one of the 7.77% Senior Notes, Series A due October 15,
2005 (the "Series A Notes") of the Company in the aggregate principal
amount of $30,000,000 issued or to be issued together with the 6.98%
Senior Notes, Series B of the Company in the aggregate principal amount of
$15,000,000 (the "Series B Notes" and together with the Series A Notes,
the "Notes") under and pursuant to the terms and provisions of the Note
Agreement, dated as of, October 1, 1995 (the "Note Agreement"), entered
into by the Company with the original purchasers therein referred to, and
this Note and the holder hereof are entitled equally and ratably with all
other Notes outstanding under the Note Agreement and the holders thereof
to all the benefits provided for thereby or referred to therein, to which
Note Agreement reference is hereby made for a statement thereof.
This Note and the other Notes outstanding under the Note Agreement may
be declared due prior to their expressed maturity dates and certain
prepayments are required to be made thereon, all in the events, on the
terms and in the manner and amounts as provided in the Note Agreement.
The Notes are not subject to prepayment or redemption at the option of
the Company prior to their expressed maturity dates except on the terms
and conditions and in the amounts and with the Make-Whole Amount, if any,
set forth in Section 2 of the Note Agreement.
This Note is registered on the books of the Company and is transferable
only by surrender thereof at the principal office of the Company duly
endorsed or accompanied by a written instrument of transfer duly executed
by the registered holder of this Note or its attorney duly authorized in
writing. Payment of or on account of principal, Make-Whole Amount, if
any, and interest on this Note shall be made only to or upon the order in
writing of the registered holder.
This Note and said Note Agreement are governed by and construed in
accordance with the laws of Illinois.
Xxxxxxx Worldwide Associates, Inc.
By:
Its
EXHIBIT A-2 (to Note Agreement)
Xxxxxxx Worldwide Associates, Inc.
6.98% Senior Note, Series B
Due October 15, 2005
PPN 479254 B* 4
No. R-
____________, 1995
$
Xxxxxxx Worldwide Associates, Inc., a Wisconsin corporation (the
"Company"), for value received, hereby promises to pay to
or registered assigns
on the fifteenth day of October, 2005
the principal amount of
Dollars ($_________)
and to pay interest (computed on the basis of a 360-day year of twelve
30-day months) on the principal amount from time to time remaining unpaid
hereon at the rate of 6.98% per annum from the date hereof until maturity,
payable semiannually on the fifteenth day of each October and April in
each year commencing April 15, 1996, and at maturity. The Company agrees
to pay interest on overdue principal (including any overdue optional
prepayment of principal) and Make-Whole Amount, if any, and (to the extent
legally enforceable) on any overdue installment of interest, at the
Overdue Rate after the due date thereof, whether by acceleration or
otherwise, until paid. "Overdue Rate" means the lesser of (a) the maximum
rate permitted by law or (b) 8.98%.
Except as provided in Section 2.6 of the Note Agreement (as hereinafter
defined), both the principal hereof and interest hereon are payable at the
principal office of the Company in Racine, Wisconsin, in coin or currency
of the United States of America which at the time of payment shall be
legal tender for the payment of public and private debts. If any amount
of principal, Make-Whole Amount, if any, or interest on or in respect of
this Note becomes due and payable on any date which is not a business day
in Xxx Xxxx, Xxx Xxxx, Xxxxxxx, Xxxxxxxx and Racine, Wisconsin, such
amount shall be payable on the next preceding business day.
This Note is one of the 6.98% Senior Notes, Series B due October 15,
2005 (the "Series B Notes") of the Company in the aggregate principal
amount of $15,000,000 issued together with the 7.77% Senior Notes, Series
A of the Company in the aggregate principal amount of $30,000,000 (the
"Series A Notes" and together with the Series B Notes, the "Notes") under
and pursuant to the terms and provisions of a Note Agreement, dated as of,
October 1, 1995 (the "Note Agreement"), entered into by the Company with
the original purchasers therein referred to, and this Note and the holder
hereof are entitled equally and ratably with all other Notes outstanding
under the Note Agreement and the holders thereof to all the benefits
provided for thereby or referred to therein, to which Note Agreement
reference is hereby made for a statement thereof.
This Note and the other Notes outstanding under the Note Agreement may
be declared due prior to their expressed maturity dates and certain
prepayments are required to be made thereon, all in the events, on the
terms and in the manner and amounts as provided in the Note Agreement.
The Notes are not subject to prepayment or redemption at the option of
the Company prior to their expressed maturity dates except on the terms
and conditions and in the amounts and with the Make-Whole Amount, if any,
set forth in Section 2 of the Note Agreement.
This Note is registered on the books of the Company and is transferable
only by surrender thereof at the principal office of the Company duly
endorsed or accompanied by a written instrument of transfer duly executed
by the registered holder of this Note or its attorney duly authorized in
writing. Payment of or on account of principal, Make-Whole Amount, if
any, and interest on this Note shall be made only to or upon the order in
writing of the registered holder.
This Note and said Note Agreement are governed by and construed in
accordance with the laws of Illinois.
Xxxxxxx Worldwide Associates, Inc.
By:
Its
EXHIBIT B (to Note Agreement)
Xxxxxxx Worldwide Associates, Inc.
Closing Certificate
To the Purchasers Named
in Schedule I to the Note
Agreement Described Below
Gentlemen:
This certificate is delivered to each of you in compliance with the
requirements of the Note Agreement dated as of October 1, 1995 (the
"Agreement"), entered into by the undersigned, Xxxxxxx Worldwide
Associates, Inc., a Wisconsin corporation (the "Company"), with each of
you, and as an inducement to and as part of the consideration for your
several purchases on this date of $30,000,000 aggregate principal amount
of its 7.77% Senior Notes, Series A due October 15, 2005 and of
$15,000,000 aggregate principal amount of its 6.98% Senior Notes, Series B
due October 1, 2005 (collectively, the "Notes") of the Company, pursuant
to the Agreement.
The terms which are capitalized herein shall have the same meanings as
in the Agreement.
The Company represents and warrants to each of you as follows:
1. Subsidiaries. Schedule II to the Agreement, states the name of each
of the Company's Subsidiaries, its jurisdiction of incorporation and the
percentage of its Voting Stock owned by the Company and/or its
Subsidiaries. Those Subsidiaries listed in Section 1 of said Schedule II
constitute all of the Subsidiaries of the Company. The Company and each
Subsidiary has good and marketable title to all of the shares it purports
to own of the stock of each Subsidiary, free and clear in each case of any
Lien. All such shares have been duly issued and are fully paid and
non-assessable, except (in the case of a Wisconsin corporation) as
provided by Section 180.0622(2)(b) of the Wisconsin Statutes.
2. Corporate Organization and Authority. The Company, and each
Restricted Subsidiary,
(a) is a corporation duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation;
(b) has all requisite power and authority and all necessary licenses
and permits to own and operate its properties and to carry on its
business as now conducted and as presently proposed to be conducted
except where the failure to obtain such licenses or Permits would not
have a material adverse effect on the condition (financial or otherwise)
of the Company and its Restricted Subsidiaries taken as a whole or on
the ability of the Company to perform its obligations under this
Agreement or the Notes; and
(c) is duly licensed or qualified and is in good standing as a foreign
corporation in each Jurisdiction wherein the nature of the business
transacted by it or the nature of the property owned or leased by it
makes such licensing or qualification necessary except where the failure
to be so licensed or qualified would not have a material adverse effect
on the condition (financial or otherwise) of the Company and its
Restricted Subsidiaries taken as a whole or on the ability of the
Company to perform its obligations under this Agreement or the Notes.
3. Business and Property. You have heretofore been furnished with a
copy of the Confidential Offering Memorandum dated March, 1995 (the
"Memorandum") prepared by The First National Bank of Chicago Private
Market Finance Department which generally sets forth the business
conducted and proposed to be conducted by the Company and its Subsidiaries
and the principal properties of the Company and its Subsidiaries.
4. Financial Statements. (a) The consolidated balance sheets of the
Company and its consolidated Subsidiaries as of September 27, 1991 and
October 2, 1992, October 1, 1993 and September 30, 1994 and the statements
of operations and cash flows for the fiscal years ended on said dates,
each accompanied by a report thereon containing an opinion unqualified as
to scope or limitations imposed by the company and otherwise without
qualification except as therein noted, by KPMG Peat Marwick LLP, have been
prepared in accordance with GAAP except as therein noted, and present
fairly the financial position of the Company and its Subsidiaries as of
such dates and the results of their operations and cash flows for such
periods, except to the extent modified pursuant to a restatement thereof
in a subsequent financial statement. The unaudited consolidated balance
sheets of the Company and its consolidated Subsidiaries as of June 30,
1995, and the unaudited statements of operations and cash flows for the
nine-month period ended on said date prepared by the Company have been
prepared in accordance with GAAP, and present fairly the financial
position of the Company and its consolidated Subsidiaries as of said date
and the results of their operations and their cash flows for such period.
(b) Since June 30, 1995, there has been no change in the condition,
financial or otherwise, of the Company and its consolidated Subsidiaries
as shown on the consolidated balance sheet as of such date except changes
in the ordinary course of business, none of which individually or in the
aggregate has been materially adverse.
5. Indebtedness. Schedule II attached to the Agreement correctly
describes all Current Debt for borrowed money and Funded Debt for borrowed
money (including Capitalized Leases and Guaranties relating to the
obligations of Persons other than the Company and its Restricted
Subsidiaries) of the Company and its Restricted Subsidiaries outstanding
on June 30, 1995 and there have been no material increases in such Current
Debt, Funded Debt and Guarantees since such date.
6. Full Disclosure. The financial statements referred to in paragraph 4
hereof, the Agreements, the Memorandum and all other written documents and
statements furnished by the Company to you in connection with the
negotiation of the sale of the Notes, taken together, do not contain any
untrue statement of a material fact or omit a material fact necessary to
make the statements contained therein or herein not misleading.
7. Pending Litigation. There are no proceedings pending or, to the
knowledge of the Company, threatened against or affecting the Company or
any Restricted Subsidiary in any court or before any governmental
authority or arbitration board or tribunal which could reasonably be
expected to have a material adverse effect on the condition (financial or
otherwise) of the Company and its Restricted Subsidiaries taken as a whole
or on the ability of the Company to perform its obligations under this
Agreement or the Notes.
8. Title to Property. The Company and each Restricted Subsidiary has
good and marketable title in fee simple (or its equivalent under
applicable law) to all material parcels of real property and has good
title to all the other material items of property it purports to own,
including that reflected in the most recent balance sheet referred to in
paragraph 4 hereof, except as sold or otherwise disposed of in the
ordinary course of business and except for Liens permitted by the
Agreement.
9. Patents and Trademarks. The Company and each Restricted Subsidiary
owns or possesses adequate licenses for the use of all the patents,
trademarks, trade names, service marks, copyright, licenses and rights
with respect to the foregoing necessary for the present conduct of its
business, without any known conflict with the rights of others.
10. Sale is Legal and Authorized. The sale of the Notes and compliance
by the Company with all of the provisions of the Agreement and the Notes-
(a) are within the corporate powers of the Company;
(b) will not violate any provisions of any law or any order of any
court or governmental authority or agency and will not conflict with or
result in any breach of any of the terms, conditions or provisions of,
or constitute a default under the Articles of Incorporation or By-laws
of the Company or any indenture or other agreement or instrument to
which the Company is a party or by which it may be bound or result in
the imposition of any Liens or encumbrances on any property of the
Company; and
(c) have been duly authorized by proper corporate action on the part of
the Company (no action by the stockholders of the Company being required
by law, by the Articles of Incorporation or By-laws of the Company or
otherwise), executed and delivered by the Company and the Agreement and
the Notes constitute the legal, valid and binding obligations, contracts
and agreements of the Company enforceable in accordance with their
respective terms.
11. No Defaults. No Default or Event of Default has occurred and is
continuing. The Company is not in default in the payment of principal or
interest on any Funded Debt or Current Debt and is not in default under
any instrument or instruments or agreements under and subject to which any
Funded Debt or Current Debt has been issued and no event has occurred and
is continuing under the provisions of any such instrument or agreement
which with the lapse of time or the giving of notice, or both, would
constitute an event of default thereunder.
12. Governmental Consent. No approval, consent or withholding of
objection on the part of any regulatory body, state, Federal or local, is
necessary in connection with the execution and delivery by the Company of
the Agreement or the Notes or compliance by the Company with any of the
provisions of the Agreement or the Notes.
13. Taxes. All tax returns required to be filed by the Company or any
Restricted Subsidiary in any jurisdiction have, in fact, been filed, and
all taxes, assessments, fees and other governmental charges upon the
Company or any Restricted Subsidiary or upon any of their respective
properties, income or franchises, which are shown to be due and payable in
such returns have been paid. For all taxable years ending on or before
September 30, 1988, the Federal income tax liability of the Company and
its Restricted Subsidiaries has been satisfied and either the period of
limitations on assessment of additional Federal income tax has expired or
the Company and its Restricted Subsidiaries have entered into an agreement
with the Internal Revenue Service closing conclusively the total tax
liability for the taxable year. The Company does not know of any proposed
additional tax assessment against it for which adequate provision has not
been made on its accounts, and no material controversy in respect of
additional Federal or state income taxes due since said date is pending or
to the knowledge of the Company threatened. The provisions for taxes on
the books of the Company and each Restricted Subsidiary are adequate for
all open years, and for its current fiscal period.
14. Use of Proceeds. The net proceeds from the sale of the Notes will be
used to refinance existing bank debt and for other corporate purposes.
None of the transactions contemplated in the Agreement (including, without
limitation thereof, the use of proceeds from the issuance of the Notes)
will violate or result in a violation of Section 7 of the Securities
Exchange Act of 1934, as amended, or any regulation issued pursuant
thereto, including, without limitation, Regulations G, T and X of the
Board of Governors of the Federal Reserve System, 12 C.F.R., Chapter 11.
Neither the Company nor any Subsidiary owns or intends to carry or
purchase any "margin stock" within the meaning of said Regulation G.
15. Private Offering. Neither the Company, directly or indirectly, nor
any agent on its behalf has offered or will offer the Notes or any similar
Security or has solicited or will solicit an offer to acquire the Notes or
any similar Security from or has otherwise approached or negotiated or
will approach or negotiate in respect of the Notes or any similar Security
with any Person other than the Purchasers and not more than 44 other
institutional investors, each of whom was offered a portion of the Notes
at private sale for investment. Neither the Company, directly or
indirectly, nor any agent on its behalf has offered or will offer the
Notes or any similar Security or has solicited or will solicit an offer to
acquire the Notes or any similar Security from any Person so as to bring
the issuance and sale of the Notes within the provisions of Section 5 of
the Securities Act of 1933, as amended.
16. ERISA. The consummation of the transactions provided for in the
Agreement and compliance by the Company with the provisions thereof and
the Notes issued thereunder will not involve any prohibited transaction
within the meaning of ERISA or Section 4975 of the Internal Revenue Code
of 1986, as amended. Each Plan complies in all material respects with all
applicable statutes and governmental rules and regulations, and (a) no
Reportable Event has occurred and is continuing with respect to any Plan,
(b) neither the Company nor any ERISA Affiliate has withdrawn from any
Plan or Multiemployer Plan or instituted steps to do so, and (c) no steps
have been instituted to terminate any Plan. No condition exists or event
or transaction has occurred in connection with any Plan which could result
in the incurrence by the Company or any ERISA Affiliate of any material
liability, fine or penalty. No Plan maintained by the Company or any
ERISA Affiliate, nor any trust created thereunder, has incurred any
"accumulated funding deficiency" as defined in Section 302 of ERISA nor
does the present value of all benefits vested under all Plans exceed, as
of the last annual valuation date, the value of the assets of the Plans
allocable to such vested benefits by an amount greater than $1,000,000 in
the aggregate. Neither the company nor any ERISA Affiliate has any
contingent liability with respect to any post-retirement "welfare benefit
plan" (as such term is defined in ERISA) except as has been disclosed to
the Purchasers.
17. Compliance with Law. Neither the Company nor any Restricted
Subsidiary (a) is in violation of any law, ordinance, franchise,
governmental rule or regulation to which it is subject; or (b) has failed
to obtain any license, permit, franchise or other governmental
authorization necessary to the ownership of its property or to the conduct
of its business, which violation or failure to obtain would materially
adversely affect the business, prospects, profits, properties or condition
(financial or otherwise) of the Company and its Restricted Subsidiaries,
taken as a whole, or impair the ability of the Company to perform its
obligations contained in the Agreement or the Notes. Neither the Company
nor any Restricted Subsidiary is in default with respect to any order of
any court or governmental authority or arbitration board or tribunal.
18. Compliance with Environmental Laws. The Company is not in violation
of any applicable Federal, state, or local laws, statutes, rules,
regulations or ordinances relating to public health, safety or the
environment, including, without limitation, relating to releases,
discharges, emissions or disposals to air, water land or ground water, to
the withdrawal or use of ground water, to the use, handling or disposal of
polychlorinated biphenyls (PCB's), asbestos or urea formaldehyde, to the
treatment, storage, disposal or management of hazardous substances
(including, without limitation, petroleum, crude oil or any fraction
thereof, or other hydrocarbons), pollutants or contaminants, to exposure
to toxic, hazardous or other controlled, prohibited or regulated
substances which violation could have a material adverse effect on the
business, prospects, profits, properties or condition (financial or
otherwise) of the Company and its Restricted Subsidiaries, taken as a
whole. The Company does not know of any liability or class of liability
of the Company or any Restricted Subsidiary under the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended
(42 U.S Section 9601 et seq.), or the Resource Conservation and Recovery
Act of 1976, as amended (42 U.S Section 6901 et seq.).
Dated:
Xxxxxxx Worldwide Associates, Inc.
By:
Its
EXHIBIT C (to Note Agreement)
Description of Special Counsel's Closing Opinion
The closing opinion of Xxxxxxx and Xxxxxx, special counsel to the
Purchasers, called for by Section 4.1 of the Note Agreement, shall be
dated the Closing Date and addressed to the Purchasers, shall be
satisfactory in form and substance to the Purchasers and shall be to the
effect that:
1. The Company is a corporation, validly existing and in good
standing under the laws of the State of Wisconsin and has the corporate
power and the corporate authority to execute and deliver the Note
Agreement and to issue the Notes.
2. The Note Agreement has been duly authorized by all necessary
corporate action on the part of the Company, has been duly executed and
delivered by the Company and constitutes the legal, valid and binding
contract of the Company enforceable in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent conveyance and similar
laws affecting creditors' rights generally, and general principles of
equity (regardless of whether the application of such principles is
considered in a proceeding in equity or at law).
3. The Notes have been duly authorized by all necessary corporate
action on the part of the Company, and the Notes being delivered on the
date hereof have been duly executed and delivered by the Company and
constitute the legal, valid and binding obligations of the Company
enforceable in accordance with their terms, subject to bankruptcy,
insolvency, fraudulent conveyance and similar laws affecting creditors'
rights generally, and general principles of equity (regardless of
whether the application of such principles is considered in a proceeding
in equity or at law).
4. The issuance, sale and delivery of the Notes under the
circumstances contemplated by the Note Agreement do not, under existing
law, require the registration of the Notes under the Securities Act of
1933, as amended, or the qualification of an indenture under the Trust
Indenture Act of 1939, as amended.
The opinion of Xxxxxxx and Xxxxxx shall also state that the opinion of
Xxxxx & Lardner is satisfactory in scope and form to Xxxxxxx and Xxxxxx
and that, in their opinion, the Purchasers are justified in relying
thereon.
In rendering the opinion set forth in paragraph 1 above, Xxxxxxx and
Xxxxxx may rely, as to matters referred to in paragraph 1, solely upon an
examination of the Articles of Incorporation certified by, and a
certificate of good standing of the Company from, the Secretary of State
of the State of Wisconsin, the By-laws of the Company and the [general
business corporation law] of the State of Wisconsin. The opinion of
Xxxxxxx and Xxxxxx is limited to the laws of the State of Illinois, the
general business corporation law of the State of Wisconsin and the Federal
laws of the United States.
With respect to matters of fact upon which such opinion is based,
Xxxxxxx and Xxxxxx may rely on appropriate certificates of public
officials and officers of the Company and upon representations of the
Company and the Purchasers delivered in connection with the issuance and
sale of the Notes.
EXHIBIT D (to Note Agreement)
Description of Closing Opinion of
Independent Counsel to the Company
The closing opinion of Xxxxx & Lardner, independent counsel for the
Company, which is called for by Section 4.2 of the Note Agreements, shall
be dated the Closing Date and addressed to the Purchasers, shall be
satisfactory in scope and form to the Purchasers and shall be to the
effect that:
(1) The Company is a corporation, duly incorporated, legally
existing and in good standing under the laws of the State of Wisconsin,
has corporate power and authority and is duly authorized to enter into
and perform the Agreements and to issue the Notes and incur the
Indebtedness to be evidenced thereby and has full corporate power and
authority to conduct the activities in which it is now engaged and is
duly licensed or qualified and is in good standing as a foreign
corporation in each jurisdiction in which the character of the
properties owned or leased by it or the nature of the business
transacted by it makes such licensing or qualification necessary;
(2) Each Restricted Subsidiary is a corporation duly organized,
legally existing and in good standing under the laws of its jurisdiction
of incorporation and is duly licensed or qualified and is in good
standing in each jurisdiction in which the character of the properties
owned or leased by it or the nature of the business transacted by it
makes such licensing or qualification necessary; and all of the issued
and outstanding shares of capital stock of each such Restricted
Subsidiary have been duly issued, are fully paid and non-assessable and
are owned by the Company, by one or more Restricted Subsidiaries, or by
the Company and one or more Restricted Subsidiaries;
(3) The Note Agreement has been duly authorized by proper corporate
action on the part of the Company, have been duly executed and delivered
by an authorized officer of the Company and constitutes the legal, valid
and binding contract and agreement of the Company enforceable in
accordance with its terms, except as enforceability thereof may be
limited by (a) bankruptcy, insolvency or similar laws, affecting the
enforcement of creditors' rights generally and (b) equitable principles
of general applicability (regardless of whether such enforceability is
considered in a proceeding in equity or at law);
(4) The Notes have been duly authorized by proper corporate action
on the part of the Company, have been duly executed by an authorized
officer of the Company and delivered and constitute the legal, valid and
binding obligations of the Company enforceable in accordance with their
terms, except as enforceability thereof may be limited by (a)
bankruptcy, insolvency or similar laws affecting the enforcement of
creditors' rights generally and (b) equitable principles of general
applicability (regardless of whether such enforceability is considered
in a proceeding in equity or at law);
(5) The issuance and sale of the Notes and the execution, delivery
and performance by the Company of the Note Agreement do not conflict
with or result in any breach of any of the provisions of or constitute a
default under or result in the creation or imposition of any lien or
encumbrance upon any of the property of the Company pursuant to the
provisions of the Articles of Incorporation or By-laws of the Company or
any agreement or other instrument known to such counsel to which the
Company or any Subsidiary is a party or by which the Company or any
Subsidiary may be bound;
(6) No approval, consent or withholding of objection of or on the
part of, or filing registration or qualification with, any governmental
body, Federal, state or local, is necessary in connection with the
execution and delivery of the Note Agreement by the Company or the
issuance, sale and delivery of the Notes by the Company;
(7) The issuance, sale and delivery of the Notes under the
circumstances contemplated by the Note Agreement is an exempt
transaction under the Securities Act of 1933, as amended, and does not
under existing law require the registration of the Notes under the
Securities Act of 1933, as amended, or the qualification of an indenture
in respect thereof under the Trust Indenture Act of 1939 as amended;
(8) There are no proceedings pending or threatened, against or
affecting the Company or any Subsidiary in any court or before any
governmental authority or arbitration board or tribunal which involve
the reasonable possibility of materially and adversely affecting the
properties, business, prospects, profits or condition (financial or
otherwise) of the Company and its Subsidiaries; and
(9) None of the transactions contemplated in the Note Agreement
(including, without limitation thereof, the use of the proceeds from the
sale of the Notes) will violate or result in a violation of Section 7 of
the Securities Exchange Act of 1934, as amended, or any regulations
issued pursuant thereto, including, without limitation, Regulations G, T
or X of the Board of Governors of the Federal Reserve System (12 C.F.R.,
Chapter II).
The opinion of Xxxxx & Xxxxxxx shall cover such other matters relating
to the sale of the Notes as the Purchasers may reasonably request. With
respect to matters of fact on which such opinion is based, such counsel
shall be entitled to rely on appropriate certificates of public officials
and officers of the Company. With respect to matters of laws of any
foreign jurisdiction, such counsel shall be entitled to rely upon the
opinion of local counsel for such jurisdiction.
