NOTE PURCHASE
AGREEMENT, dated as of April , 1997 (the
"Agreement"), by and among Aegis Auto Finance,
Inc., a Delaware Corporation (the "Company"),
The Aegis Consumer Funding Group, Inc., a
Delaware corporation ("Parent"), and the
Purchaser or Purchasers named on the execution
pages hereof.
In consideration of the mutual
covenants and agreements set forth herein and for
good and valuable consideration, the receipt of
which is hereby acknowledged, the parties agree
as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Definitions. As used
in this Agreement, and unless the context requires
a different meaning, the following terms have the
meanings indicated:
"Act" means the Securities Act of
1933, as amended, and the rules and regulations of
the Commission thereunder.
"Affiliate" of any specified Person
means any other Person directly or indirectly
controlling or controlled by or under direct or
indirect common control with such specified
Person. For the purposes of this definition,
"control" when used with respect to any Person
means the power to direct the management and
policies of such Person, directly or indirectly,
whether through the ownership of voting
securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings
correlative to the foregoing.
"Agreement" means this Agreement,
as the same may be amended, supplemented or
modified in accordance with the terms hereof and
in effect.
"Basic Documents" means,
collectively, the Agreement, the Guaranty, the ^
Collateral Documents, the Registration Rights
Agreement, the Indenture and the Securities.
"Business Day" means each
Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which banking
institutions in the City of New York or London,
England are not required to be open.
"Certificate of Designation" shall
have the meaning ascribed thereto in the
Indenture.
"Closing" has the meaning provided
therefor in Section 2.1 of this Agreement.
"Code" means the Internal Revenue
Code of 1986, as amended.
"Collateral Documents" has the
meaning ascribed thereto in the Indenture.
"Commission" means the Securities
and Exchange Commission.
"Common Stock" has the meaning
ascribed thereto in the Indenture.
"Company" means Aegis Auto
Finance, Inc., a Delaware corporation.
"Default" means any event, act or
condition which, with notice or lapse of time or
both, would constitute an Event of Default.
"Disclosure Documents" means,
collectively, (i) the most recent Annual Report on
Form 10-K filed by the Parent and (ii) all other
reports and statements, including quarterly Reports
on Form 10-Q filed by the Parent and any of its
Subsidiaries under the Exchange Act prior to the
date hereof but subsequent to the most recent
Annual Report on Form 10-K.
"Event of Default" means any event
defined as an Event of Default in the Indenture.
"Exchange Act" means the
Securities Exchange Act of 1934, as amended, and
the rules and regulations of the Commission
thereunder.
"GAAP" means generally accepted
accounting principles set forth in the opinions and
pronouncements of the Accounting Principles
Board of the American Institute of Certified
Public Accountants and statements and
pronouncements of the Financial Accounting
Standards Board or in such other statements by
such other entity as may be approved by a
significant segment of the accounting profession,
which are applicable to the circumstances as of the
date of determination.
"Guaranty" has the meaning
ascribed thereto in the Indenture.
"Holders" means the holders from
time to time of any of the Securities, whether or
not such Holders were original Purchasers of
Securities hereunder.
"Indenture" means the Indenture,
substantially in the form of Exhibit 1 hereto.
"Investment Company Act" means
the Investment Company Act of 1940, as
amended, and the rules and regulations of the
Commission thereunder.
"Lien" means, with respect to any
asset, (i) any mortgage, lien, pledge, encumbrance,
charge or security interest of any kind in or on
such asset, (ii) the interest of a vendor or lessor
under any conditional sale agreement, capital lease
or other title retention agreement relating to such
asset or (iii) in the case of securities, any purchase
option, call or similar right of a third party with
respect to such securities.
"Majority of the Purchasers" means
those Purchasers which, at the time of
determination thereof, individually or in the
aggregate, are committed to purchase pursuant to
this Agreement a majority of the principal
amount of the Securities.
"Parent" shall mean The Aegis
Consumer Funding Group, Inc., a Delaware
corporation.
"Permitted Liens" means (i) Liens
for taxes, assessments, governmental charges or
claims which are being contested in good faith by
appropriate proceedings promptly instituted and
diligently conducted and for which a reserve or
other appropriate provision, if any, as shall be
required in conformity with GAAP shall have
been made which (x) do not in the aggregate
materially detract from the value of such property
or assets or materially impair the use thereof in
the operation of the business of the Company or
any Subsidiary of the Company or (y) are being
contested in good faith by appropriate
proceedings, which proceedings have the effect of
preventing the forfeiture or sale of the property or
assets subject to such Lien; (ii) statutory Liens of
landlords, and warehousemen's, mechanics',
suppliers', materialmen's, repairmen's, or other
like Liens arising in the ordinary course of
business and with respect to amounts not yet
delinquent or being contested in good faith by
appropriate proceedings, which proceedings have
the effect of preventing the forfeiture or sale of
the property or asset subject to such Lien; and
(iii) existing Liens as of the date hereof.
"Person" means an individual or a
corporation, limited liability company partnership,
trust, incorporated or unincorporated association,
joint venture, joint stock company, government (or
an agency or political subdivision thereof) or other
entity of any kind.
"Preferred Stock" shall mean the
Class D Redeemable Preferred Stock of the Parent
described in the Certificate of Designation.
"Purchaser" means each Person who
accepts and agrees to the terms hereof, as
indicated by signature on the execution page of
this Agreement or a counterpart as referred to in
Section 8.6 of this Agreement and, subject to
Article VI of this Agreement, each Substitute
Purchaser (as such term is defined in Article VI).
"Securities" has the meaning
ascribed thereto in the Indenture.
^
"State" means each of the states of
the United States, the District of Columbia and the
Commonwealth of Puerto Rico.
"Subsidiary" means, with respect to
any Person, (i) a corporation a majority of whose
capital stock with voting power, under ordinary
circumstances, to elect directors is at the time,
directly or indirectly, owned by such Person, by
one or more Subsidiaries of such Person or by
such Person and one or more Subsidiaries thereof
or (ii) any other Person (other than a corporation)
in which such Person, one or more Subsidiaries
thereof or such Person and one or more
Subsidiaries thereof, directly or indirectly, at the
date of determination thereof, has at least majority
ownership interest.
"Time of Purchase" has the
meaning provided therefor in Section 2.1 of this
Agreement.
"Trustee" means the Trustee under
the Indenture.
"Warrant" has the meaning ascribed
thereto in the Indenture.
Section 1.2 Accounting Terms;
Financial Statements. All accounting terms used
herein not expressly defined in this Agreement
shall have the respective meanings given to them
in accordance with generally accepted accounting
principles.
ARTICLE II
PURCHASE OF SECURITIES;
RIGHTS OF HOLDERS OF SECURITIES
Section 2.1 Purchase of Securities.
Subject to the terms and conditions herein set
forth, the Company agrees that it will sell to
each Purchaser, and each such Purchaser agrees,
severally and not jointly, that it will purchase from
the Company at the Time of Purchase, the
principal amount of Securities set forth opposite
such Purchaser's name on the execution pages
hereof at a price equal to 93.75% of the aggregate
principal amount of Securities to be purchased by
such Purchaser. The Securities shall have the
terms set forth in the Indenture.
The purchase and sale of Securities
to the Purchasers will take place at a closing (the
"Closing") at the offices of Sidley & Austin, 000
Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx on such date
not later than April 30, 1997 (subject to extension
if the Purchasers agree to extend the Time of
Purchase, upon request to do so by the Company)
and at such time as the Company shall specify by
notice to the Purchasers at least one full Business
Day prior thereto. The date and time at which the
Closing is to be concluded is the "Time of
Purchase."
Delivery of the Securities to be
purchased by a Purchaser pursuant to this
Agreement shall be made at the Closing by the
Company delivering to such Purchaser the
Security to be purchased by such Purchaser
hereunder (registered in the name of such
Purchaser or such other Person (which shall be an
Affiliate of such Purchaser or a nominee of such
Purchaser or such Affiliate) as such Purchaser may
have designated in writing to the Company prior
to the Time of Purchase), unless prior to the Time
of Purchase such Purchaser shall have requested,
in writing, the Company to deliver more than one
Security, in which event the Company will deliver
to such Purchaser the number of Securities so
requested, registered in such name or names and
in such principal amounts (which shall not in the
aggregate exceed the aggregate principal amount
of Securities to be purchased by such Purchaser)
as shall have been specified in such a request.
Payment of the purchase price for
the Securities to be purchased hereunder shall be
made by each Purchaser by wire transfer (to such
account of the Company as shall have been
furnished to the Purchasers at the time the
Company notifies the Purchasers of the Time of
Purchase) of immediately available funds.
The Company will bear all expenses
of shipping any of the Securities (including,
without limitation, insurance expenses) from New
York City to such other places within the United
States of America as any Purchaser shall specify.
Any tax on the issuance of any of the Securities
will be paid by the Company at the Time of
Purchase.
Section 2.2 Restrictions on
Transfer. (a)(i) Unless a registration statement
with respect thereto under the Act is at the time in
effect, no Security shall be transferred (such term
to include any disposition which would constitute
a sale within the meaning of the Act), except upon
compliance with the conditions specified in this
subsection (a), and unless such a registration
statement is effective or such conditions are
complied with, the Company may issue or cause
to be issued stop orders preventing any such
transfer, subject to a Holder's right at all times to
sell or otherwise dispose of all or any part of the
Securities under a registration under the Act or
any exemption from such registration available
under the Act.
(ii) Each Security initially issued
under this Agreement and each Security issued in
exchange therefor shall (unless otherwise
permitted by the provisions of subsection (b)) be
stamped or otherwise imprinted with a legend in
substantially the form set forth in Section 3.05(i)
of the Indenture.
(b) The holder of each Security
by the acceptance thereof agrees that it shall not
transfer such Security unless a registration
statement under the Act is in effect with respect to
such transfer or, prior to such transfer, it shall
have delivered to the Company (x) an opinion of
counsel, experienced in matters under the Act,
reasonably acceptable to the Company and counsel
to the Company which opinion shall be in a form
reasonably acceptable to the Company and counsel
to the Company or (y) a "no action" letter from
the Commission to the effect that the proposed
transfer may be effected without registration under
the Act; provided, however, that in case of any
sale or other transfer of Securities to any Person
who is an institutional investor, no opinion of
counsel or "no action" letter shall be required if
such holder obtains and delivers to the Company a
written representation from such Person that it is
an institutional investor, including an insurance
company, and is acquiring the Securities for its
own account or as trustee for a commingled
pension trust fund for purposes of investment and
with no intention of distributing or reselling said
Securities in any transaction which would be in
violation of the securities laws of the United
States of America or any State, subject,
nevertheless, to such Person's disposition of its
property being at all times within its control,
including such Person's right at all times to sell or
otherwise dispose of all or any part of the
Securities under a registration under the Act or
any exemption from such registration available
under the Act.
Section 2.3 Indemnification for
Taxes. (a) So long as the Person to whom such
payment is due has complied with the
requirements of Sections 2.3(d) and (e) hereof, all
payments (including, without limitation, payments
on account of principal, interest and fees) shall be
made by the Company without deduction or
withholding for or on account of any tax,
assessment or other governmental charge imposed
by any jurisdiction (not being a branch profits tax,
a franchise tax or a tax imposed on the overall net
income of its lending office by the jurisdiction in
which it is incorporated, in which its lending
office is located or in which it is managed and
controlled) ("Taxes"). If the Company is required
by law to make any deduction or withholding of
any Taxes of any jurisdiction from any payment
due hereunder to a person who has complied with
the requirements of Sections 2.3(d) and (e) hereof,
then the amount payable will be increased to such
amount which, after deduction from such
increased amount of all such Taxes required to be
withheld or deducted therefrom, will not be less
than the amount due and payable hereunder had
no such deduction or withholding been required.
(b) If the Company makes any
payment hereunder in respect of which it is
required by law to make any deduction or
withholding of any Taxes, it shall pay the full
amount to be deducted or withheld to the relevant
taxation or other authority within the time allowed
for such payment under applicable law and shall
deliver to the Purchasers as soon as practicable
after it has made such payment to the applicable
authority a receipt issued by such authority or a
statement of the Company confirming the payment
to such authority of all amounts so required to be
deducted or withheld from such payment.
(c) If any Purchaser is required
by law to make any payment on account of Taxes
on or in relation to any sum received or receivable
hereunder by such Purchaser or any liability for
Taxes in respect of any such payment is imposed,
levied or assessed against any Purchaser, the
Company will, upon demand and delivery to the
Company of a photocopy of a receipt (if any)
issued by the applicable authority which received
such payment or a statement of such Purchaser
confirming such payment to such authority,
promptly indemnify such Purchaser against such
tax payment or liability, together with any interest,
penalties and expenses payable or incurred in
connection therewith.
(d) Each Purchaser shall submit
to the Company, on the Closing Date and from
time to time as required by law, two duly
completed and signed copies of one of the
following as such Purchaser may deem
appropriate: Form 1001 (relating to such Purchaser
and evidencing its entitlement to a complete
exemption from withholding on all amounts to be
paid by the Company and received by such
Purchaser pursuant to this Agreement), Form 4224
(relating to all amounts to be paid by the
Company and received by such Purchaser pursuant
to this Agreement) or Form W-8 of the United
States Internal Revenue Service.
(e) Thereafter and from time to
time, each Purchaser shall (in particular, but
without limitation, within 10 days of the transfer
or assignment to it becoming effective, each
transferee and each assignee of each Purchaser and
each subsequent transferee and assignee shall),
submit to the Company such additional duly
completed and signed copies of one or the other
(as each Purchaser (or any assignee or transferee)
may deem appropriate) of such Forms 1001, 4224,
W-8 (or such successor Forms as shall be adopted
from time to time by the relevant United States
taxing authorities) or of such a certification as
may be (a) notified by the Company to each
Purchaser, and (b) required under then current
United States law or regulations to avoid United
States withholding taxes on payments in respect of
all amounts to be paid by the Company and
received by each Purchaser.
(f) The Company shall, upon
receipt of any of the forms or certificates referred
to in such Section 2.3(d) or (e) hereof,
acknowledge such receipt and the compliance by
such Purchaser with such Section 2.3(d) or (e), as
the case may be.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.1 Representations and
Warranties of the Company and Parent. The
Company and Parent, jointly and severally,
represent and warrant to, and covenant and agree
with, each of the Purchasers as follows:
(a) Organization,
Standing, Etc. The Company and
the Parent are corporations duly
organized and in good standing
under the laws of their respective
jurisdictions of incorporation. The
Company and the Parent are duly
qualified and in good standing as
foreign corporations, and are
authorized to do business, in each
jurisdiction in which the ownership
or leasing of any property or the
character of its operations makes
such qualification necessary and in
which the failure so to qualify
could have a material adverse effect
on the condition (financial or
otherwise), properties, assets,
business or results of operations of
the Company and the Parent, taken
as a whole. The Company and the
Parent have all requisite corporate
power and authority to own their
respective assets and to carry on
their respective businesses as
currently conducted. The Company
and the Parent have all requisite
corporate power and authority (i) to
execute, deliver and perform their
respective obligations under the
Basic Documents, (ii) to issue the
Securities pursuant hereto in the
manner and for the purpose
contemplated by this Agreement
and (iii) to execute, deliver and
perform their respective obligations
under all other agreements and
instruments executed and delivered
by, or to be executed and delivered
by, the Company or the Parent
pursuant to or in connection with
the Basic Documents. The Basic
Documents have been duly and
validly authorized executed and
delivered by the Company or the
Parent, as the case may be, and
each constitutes a valid and binding
agreement of the Company or the
Parent, as the case may be,
enforceable in accordance with its
terms (except in each such case as
enforceability may be limited by
bankruptcy, insolvency,
reorganization and other similar
laws now or hereafter in effect
relating to or affecting creditors'
rights generally and except that the
remedy of specific performance and
injunctive and other forms of
equitable relief are subject to certain
equitable defenses and to the
discretion of the court before which
any proceeding therefor may be
brought and except as rights to
indemnity and contribution here-
under and thereunder may be
limited by Federal or state securities
laws).
(b) Financial Statements.
(i) The Company has delivered to
the Purchasers the consolidated
balance sheet of the Parent at June
30, 1996 and the related
consolidated statements of income
and retained earnings and cash
flows of the Parent for the fiscal
year ended on said date, which
statements have been certified by
Ernst & Young, LLP, independent
certified public accountants, such
statements present fairly the
consolidated financial position of
the Parent and the results of its
operations for the periods covered
thereby and all such financial
statements have been prepared in
accordance with GAAP consistently
applied, and (ii) the Company has
delivered to the Purchasers
unaudited consolidated balance
sheets and the unaudited interim
consolidated statements of income
and retained earnings as set forth in
the Company's Form 10-Q for the
period ending December 31, 1996.
The unaudited consolidated
financial statements in (ii) above
have been prepared in accordance
with GAAP applied on a basis
consistent with those of the audited
financial statements referred to in
(i) above and otherwise consistent
with the accounting methodology
contained in GAAP.
(c) No Material Change.
Since December 31, 1996, there has
been no material adverse change in
the condition (financial or
otherwise), properties, assets,
business or results of operations of
the Parent and its Subsidiaries,
taken as a whole, other than those
changes disclosed in the unaudited
interim financial statements referred
to in Section 3.1 (b)(ii) or the
Disclosure Documents.
(d) Conflicting
Agreements and Other Matters.
The execution, delivery and
performance by the Company or the
Parent, as the case may be, of the
Basic Documents and the issuance
and performance by the Company
of its obligations under the
Securities, and the execution,
delivery and performance by the
Company or the Parent, as the case
may be, of all other agreements and
instruments to be executed and
delivered by the Company or the
Parent, as the case may be, pursuant
hereto or in connection herewith or
therewith, and compliance by the
Company or the Parent, as the case
may be, with the terms and
provisions hereof and thereof do not
and will not (i) violate, in any
material respect, any provision of
any law, rule or regulation,
including, without limitation,
Regulation G, T, U or X of the
Board of Governors of the Federal
Reserve System (but excluding state
securities or "blue sky" laws), order,
writ, judgment, injunction, statute,
decree, determination or award of
any court or any public,
governmental or regulatory agency
or body applicable to the Company
or the Parent, as the case may be,
or any of their respective properties
or assets; (ii) conflict with or result
in a breach of or constitute a
default under any provision of the
charter or by-laws of the Company
or the Parent, as the case may be;
(iii) require any consent, approval
or notice under or result in a
violation or breach of or constitute
(with or without due notice or lapse
of time or both) a default (or give
rise to any right of termination,
cancellation or acceleration) under
any of the terms, conditions or
provisions of any note, bond,
mortgage, indenture or loan or
credit agreement, license, or any
other agreement or instrument or
obligation to which the Company or
the Parent is a party or by which
the Company or the Parent or any
of their respective properties or
assets may be bound; or (iv) result
in or require the creation or
imposition of any Lien upon or
with respect to any of the properties
now owned or hereafter acquired by
the Company or the Parent, except
as permitted or contemplated by the
Indenture.
(e) Litigation,
Proceedings; Defaults. Except as
set forth in the Disclosure
Documents, there are no actions,
suits or proceedings pending or
threatened with respect to the
Company or the Parent that would
reasonably be expected to have a
materially adverse effect on (i) the
business, properties, assets,
operations or condition (financial or
otherwise) or results of operations
of the Company and the Parent
taken as a whole or (ii) the rights or
remedies of the Purchasers under
the Basic Documents or on the
ability of the Company and the
Parent to perform their respective
obligations under the Basic
Documents.
(f) Governmental
Consents, etc. Except to the extent
obtained or made prior to the date
hereof, no authorization, consent,
approval, license, qualification or
formal exemption from, nor any
filing, declaration or registration
with, any court, governmental body
or regulatory agency or authority or
any securities exchange or any other
person is required in connection
with the issuance and sale of the
Securities or the execution, delivery
or performance by the Company or
the Parent, as the case may be, of
the Basic Documents (other than
filings with the appropriate filing
offices to perfect the Liens and
security interests to be afforded
thereby).
(g) Investment Company
Act. Neither the Company nor the
Parent is an "investment company"
or a company "controlled" by an
"investment company" within the
meaning of the Investment
Company Act of 1940, as amended,
and the rules and regulations of the
Commission promulgated
thereunder.
(h) Governmental
Regulation. The Company and the
Parent are not subject to any
Federal or state statute or regulation
limiting the ability of the Company
or the Parent to issue and sell the
Securities and perform their
respective obligations under the
Basic Documents.
(i) Disclosure
Documents. The Disclosure
Documents were prepared with
reasonable care on the basis set
forth therein and when they were
filed with the Commission
conformed in all material respects
to the requirements of the Exchange
Act. The Disclosure Documents
did not, as of their respective dates,
contain any untrue statement of a
material fact or omit to state any
material fact required to be stated
therein or necessary in order to
make the statements made therein,
in light of the circumstances under
which they were made, not
misleading. There is no fact known
by the Company which has not
been disclosed in the Disclosure
Documents which materially
adversely affects the condition
(financial or otherwise), properties,
assets, business or results of
operations of the Parent and its
Subsidiaries, taken as a whole, or
the ability of the Company or the
Parent to perform their respective
obligations under the Basic
Documents.
(j) Statutory
Compliance. The Company and the
Parent are in compliance with all
applicable statutes, laws, ordinances
or government rules and regulations
to which they are subject,
noncompliance with which would
materially adversely affect the
condition (financial or otherwise),
properties, assets, business or results
of operations of the Company and
the Parent, taken as a whole.
(k) Taxes. All material
tax returns required to be filed by
the Company or the Parent in any
jurisdiction have been so filed, or
are under valid extensions, and all
taxes, assessments, fees and other
charges due or claimed to be due
from the Company or the Parent
which are shown therein as due and
payable have been paid, other than
those being contested in good faith
or those currently payable without
penalty or interest. The Company
knows of no material proposed
additional tax assessments against it
or Parent.
(l) Due Issuance. The Securities
have been duly and validly authorized by all
necessary corporate action
and, when executed and
authenticated in accordance
with the terms of the
Indenture and issued and
delivered in accordance with
the terms of this Agreement
against payment therefor,
will have been duly
authorized, executed,
authenticated and delivered
by the Company and will
constitute valid and binding
obligations of the Company
entitled to the benefits of the
Indenture, enforceable
against the Company in
accordance with their terms
(except as enforceability
may be limited by
bankruptcy, insolvency,
reorganization and other
similar laws now or
hereinafter in effect relating
to or affecting creditors'
rights generally, except that
the remedy of specific and
injunctive and other forms
of equitable relief are subject
to certain equitable defenses
and to the discretion of the
court before which any
proceeding therefor may be
brought and except as the
enforcement of
indemnification provisions
may be limited by public
policy or applicable law).
The Preferred Stock issuable
upon exchange of the
Securities and the Common
Stock and Warrants issuable
upon redemption of the
Preferred Stock, have each
been duly and validly
authorized by all necessary
corporate action (or will be
authorized promptly in
accordance with the
Indenture) and upon
exchange of the Securities or
redemption of the Preferred
Stock, as the case may be,
will be duly and validly
outstanding and fully paid
and will be non-assessable.
Except as set forth in the
Disclosure Documents, there
are no outstanding options,
conversion rights, warrants,
preemptive rights, rights of
first refusal or other rights,
or agreements or
commitments obligating the
Company to issue, transfer
or sell any interests in the
equity of the Company other
than employee stock options
granted pursuant to the
option plans described in the
Disclosure Documents.
(m) No Offer. Neither the
Company nor the Parent or any of the Affiliates
or any person
authorized to act on
their behalf has sold,
offered for sale,
solicited offers to
buy or otherwise
negotiated in respect
of Securities in a
manner which would
require registration
under the Act.
(n) No Registration or
Qualification. Subject to compliance by the
Purchasers with the
representations and
warranties set forth
in Section 3.2 hereof,
it is not necessary in
connection with the
offer, sale and
delivery of the
Securities to the
Purchasers
contemplated by this
Agreement to register
the Securities under
the Act or to qualify
the Indenture under
the Trust Indenture
Act of 1939, as
amended.
Section 3.2 Representations and
Warranties of the Purchasers. (a) Each
Purchaser (as to itself only) represents and
warrants to, and covenants and agrees with, the
Company that the Securities to be acquired by it
pursuant to this Agreement are being acquired for
its own account and/or on behalf of managed
accounts who are purchasing for their own
accounts ("Accounts") and not for the account of
any Plan (or, if such Securities are being acquired
for the account of any such Plan, such acquisition
does not involve a nonexempt prohibited
transaction within the meaning of Section 406 of
the Employee Retirement Income Security Act of
1974, as amended ("ERISA") or Section 4975 of
the Code) and with no intention of distributing or
reselling such Securities or any part thereof or any
securities for which the Securities may be
exchanged or which may be issued upon
redemption of the Securities or of the securities
for which they may be exchanged in any
transaction which would be in violation of the
securities laws of the United States of America or
any State, without prejudice, however, to a
Purchaser's rights at all times to sell or otherwise
dispose of all or any part of such Securities or any
such other securities under a registration under the
Act or under an exemption from such registration
available under such Act, and subject,
nevertheless, to the disposition of a Purchaser's
property being at all times within its control.
(b) Each Purchaser represents
that no part of the funds to be used to purchase
the Securities to be purchased by it constitutes
assets allocated to any qualified trust which
contains the assets of any employee benefit plan
with respect to which the Company is a party in
interest or disqualified person.
(c) Each Purchaser (as to itself
only) hereby represents to the Company and to
each of the other Purchasers that unless otherwise
approved by the Company as an "accredited
investor" (as defined in Rule 501 of Regulation D
of the Act), (i) it is an institutional investor,
(ii) by reason of its business and financial
experience, and the business and financial
experience of those Persons, if any, retained by it
to advise it with respect to its investment in the
Securities, such Purchaser, together with such
advisors, has such knowledge, sophistication and
experience in business and financial matters so as
to be capable of evaluating the merits and risks of
the prospective investment or (iii) if it is
purchasing the securities to be purchased by it on
behalf of accounts, it is doing so pursuant to
authority granted to it by each such account; the
Securities being purchased hereunder for such
account are being purchased for the account of
such account; the representations and warranties
set forth in this Section 3.2 are true and correct as
to each such account and the Securities being
purchased by or for such account; and each such
account will be fully bound by and subject to this
Agreement in all respects as a Purchaser. Each
Purchaser further represents that it or each of the
accounts, as the case may be, can afford to suffer
the loss of its entire investment in the Securities
and is not purchasing the Securities in reliance
upon any investigation made by any other
Purchaser.
ARTICLE IV
CONDITIONS PRECEDENT TO CLOSING
Section 4.1 Conditions Precedent
to Obligations of the Purchasers. The obligation
of each Purchaser to purchase the Securities to be
purchased by it hereunder is subject to the
satisfaction of the following conditions at the
Time of Purchase:
(a) The representations
and warranties made by the
Company herein shall be true and
correct in all material respects
(except for changes expressly
provided for or contemplated in this
Agreement) on and as of the Time
of Purchase with the same effect as
though such representations and
warranties had been made on and as
of the Time of Purchase.
(b) The Company and
the Parent shall have performed and
complied in all material respects
with all covenants, agreements and
conditions set forth or contemplated
herein which are required to be
performed or complied with by
them at or prior to the Time of
Purchase.
(c) Except as disclosed
in the Disclosure Documents or the
unaudited interim financial
statements referred to in Section
3.1(b), there shall not have occurred
any material adverse change or any
development involving a
prospective material adverse change
in the condition (financial or
otherwise), business, assets,
properties, prospects or results of
operations of the Company and the
Parent, taken as a whole,
subsequent to the date of the last of
such unaudited financial statements.
(d) At the Time of
Purchase and after giving effect to
the consummation of the
transactions contemplated by this
Agreement, there shall exist no
Default or Event of Default.
(e) The purchase of the
Securities agreed to be purchased
by such Purchaser hereunder shall
not at the Time of Purchase be
prohibited or enjoined (temporarily
or permanently) under the laws of
any jurisdiction to which such
Purchaser is subject.
(f) The Basic Documents
shall have been duly executed and
delivered by all the respective
parties thereto.
(g) At the Time of
Purchase, such Purchaser shall
have received a certificate dated the
Time of Purchase signed by the
Chairman or the President or the
Executive Vice President of the
Parent stating that the conditions
specified in Sections 4.1(a), (b), (c)
and (d) have been satisfied at the
Time of Purchase.
(h) As to each Purchaser,
the transactions contemplated by
this Agreement (i) shall not be
prohibited by an applicable law or
governmental regulation (including,
without limitation, Regulation G, T,
U or X of the Board of Governors
of the Federal Reserve System),
(ii) shall not subject the Purchaser
to any penalty or, in its reasonable
judgment, other onerous condition
under or pursuant to any applicable
law or governmental regulations,
and (iii) shall be permitted by the
laws and regulations of the
jurisdiction to which it is subject.
(i) The Trustee shall
have received an executed copy of ^
each of the Collateral Documents
together with delivery of ^ any
collateral required to be delivered
pursuant to and in accordance with
the terms of ^ the Collateral
Documents.
(j) The Trustee shall
have received an executed copy of
the Guaranty.
(k) The Trustee shall have
received evidence satisfactory to it that the
Certificate of Designation has been filed
with the Secretary of State of the State of
Delaware.
(l) Each Purchaser shall have
received from Xxxxxxxx & Xxxxx an opinion
addressed to the
Purchaser, dated the
Closing Date, the
substantive context of
which shall be in
substantially the form
of Exhibit A.
Section 4.2 Conditions Precedent
to obligations of the Company. The obligation of
the Company to issue and sell the Securities is
subject to the satisfaction of the following
conditions at the Time of Purchase:
(a) The representations
and warranties made by the
Purchasers herein shall be true and
correct in all material respects on
and as of the Time of Purchase
with the same effect as though such
representations and warranties had
been made on and as of the Time of
Purchase.
(b) The purchase or sale
of the Securities shall not be
enjoined (temporarily or
permanently) at the Time of
Purchase.
ARTICLE V
COVENANTS
Section 5.1 Certain Amendments.
The Company and the Parent agree not to amend
or change any of the applicable Basic Documents
in a manner adverse to it or the Purchasers
without the consent of a majority of the
Purchasers.
Section 5.2 Inspection. The
Company covenants that it will permit any Person
designated by such Purchaser in writing, at such
Purchaser's expense, to visit and inspect any of
the Parent's or the Company's offices, or to
inspect the corporate books and financial records
of the Parent or the Company and their respective
Subsidiaries and to discuss their affairs, finances
and accounts with the principal officers of the
Parent or the Company and their respective
Subsidiaries, all at such reasonable times and as
often as Purchaser may reasonably request. Each
Purchaser agrees that any information obtained by
it as a result of such visits, inspections and
discussions or pursuant to this Agreement shall be
confidential and shall not be used by it as the
basis for any market transactions in securities of
the Company unless and until such information
has been made generally available to the public.
Notwithstanding the foregoing, there will be no
such inspection rights granted to Purchasers under
this Section 5.2 as long as the Company is
required to file reports with the Commission
pursuant to Section 13(a) or 15(d) of the
Exchange Act.
Section 5.3 Availability of Capital
Stock. The Company shall at all times reserve
and keep available out of its authorized but
unissued Preferred Stock, for the purposes of
effecting the exchange of the Securities, the full
number of shares of Preferred Stock then issuable
upon the exchange of the Securities. The
Company shall at all times reserve and keep
available out of its authorized but unissued
Common Stock, for the purpose of effecting the
redemption of the Preferred Stock, the full number
of shares of Common Stock then issuable upon the
redemption of the Preferred Stock, provided, that
if at any time the number of shares of Preferred
Stock or Common Stock remaining unissued and
available for issuance shall be insufficient to
permit the exchange or redemption of the
Securities, as the case may be, the Company will,
from time to time, in accordance with the laws of
the State of Delaware, increase the authorized
amount of Preferred Stock or Common Stock to
permit such exchange or redemption.
Section 5.4 The Company and the
Parent covenant that, until such time as the
Securities have been paid in full or are deemed to
be satisfied and discharged in full pursuant to the
Indenture, they will not, and will not permit any
of their respective Subsidiaries to, redeem any of
the Preferred Stock pursuant to Section 3.3 of the
Certificate of Designation.
ARTICLE VI
SUBSTITUTION OF PURCHASERS
Section 6.1 Substitution of
Purchasers. If (i) one or more of the Purchasers
(a "Non-Purchaser") does not purchase all or part
of the Securities which such Non-Purchaser(s) has
agreed to purchase hereunder, and (ii) one or more
other Purchasers or one or more other Persons (a
"Substitute Purchaser") is willing to assume the
obligations of the Non-Purchaser(s) under this
Agreement, then the obligations of the Non-
Purchaser(s) to purchase Securities pursuant to this
Agreement may be assumed by the Substitute
Purchaser(s), and such Substitute Purchaser(s)
shall be substituted for the Non-Purchaser(s) under
this Agreement, by such Substitute Purchaser(s)
executing and delivering a copy of this Agreement
and thereby becoming a party hereto. The
inclusion of this Section 6.1 in this Agreement,
and the assumption by a Substitute Purchaser of
the obligations of a Non-Purchaser pursuant to this
Section 6.1, shall not constitute a waiver of any
rights the Company may have against such Non-
Purchaser if such Non-Purchaser has defaulted in
its obligations under this Agreement.
ARTICLE VII
INDEMNITY; CONTRIBUTION
Section 7.1 Indemnity.
(a) Indemnification. The
Company and the Parent agree and covenant to
jointly and severally hold harmless and indemnify
each of the Purchasers and (i) any Affiliates
thereof and (ii) any managed accounts who are
purchasing for their own account (including any
director, officer, employee, agent, investment
adviser, or controlling person of any of the
foregoing) from and against any losses, claims,
damages, liabilities and expenses (including but
not limited to attorneys' fees and expenses of
investigation preparation or defending against any
litigation, commenced or threatened, or any claim
whatsoever, and any and all amounts paid in
settlement of any claim or litigation) incurred by
such Purchaser pursuant to any actual or
threatened third-party action, suit, proceeding or
investigation (including expenses of investigation)
(A) arising out of or based upon any untrue
statement of any material fact contained in the
Disclosure Documents, or arising out of or based
upon the omission to state a material fact required
to be stated therein or necessary to make the
statements therein, in light of the circumstances
under which they were made, not misleading,
(B) arising out of or based upon any breach by the
Company or the Parent of the representations,
warranties and agreements herein or (C) arising
out of or based upon or in any way related or
attributed to claims, actions or proceedings by any
party other than such Purchaser relating to this
Agreement; provided, however, that neither the
Company nor the Parent shall be liable under this
paragraph (a) for any amounts paid in settlement
of claims without their consent, which consent
shall not be unreasonably withheld or to the extent
that it is finally judicially determined that such
losses, claims, damages or liabilities (i) arose out
of the gross negligence or willful misconduct of
such Purchaser and such negligence or misconduct
was not committed by such Purchaser or its agents
in reliance upon any of the Company's or the
Parent's warranties, covenants or promises herein
or in any other documents contemplated hereby or
thereby, including certificates delivered by the
Company pursuant hereto, or (ii) arose from a
violation by such Purchaser of legal requirements
applicable to such Purchaser primarily because of
its character as a particular type of regulated
institution. The Company and the Parent further
agree promptly upon demand by such Purchaser to
reimburse each Purchaser for any legal and other
expenses as they are incurred by it in connection
with investigating, preparing to defend or
defending any lawsuits, claims or other
proceedings or investigations arising in any
manner out of or in connection with such person
being a Purchaser and as to which the Company
and the Parent is liable to indemnify. The
indemnity, contribution and expense
reimbursement obligations of the Company and
the Parent under this Article VII shall be in
addition to any liability the Company and the
Parent may otherwise have.
(b) Procedure. Promptly after
receipt by an indemnified party under this Article
VII of notice of the commencement of any action,
proceeding or investigation or threat thereof, such
indemnified party will, if a claim in respect
thereof is to be made against the indemnifying
party hereunder, notify in writing the
indemnifying party of the commencement thereof;
but the omission so to notify the indemnifying
party will not relieve it from any liability which it
may have to any indemnified party except to the
extent that any indemnifying party is prejudiced
by such omission. In case any such action shall
be brought against any indemnified party and it
shall notify the indemnifying party of the
commencement thereof, the indemnifying party
shall be entitled to participate therein and, to the
extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume
the defense thereof, with counsel reasonably
satisfactory to such indemnified party (who shall
not, except with the consent of the indemnified
party, which consent shall not be unreasonably
withheld, be counsel to the indemnifying party),
and, after notice from the indemnifying party to
such indemnified party of its elections to assume
the defense thereof and the actual assumption of
such defense, the indemnifying party shall not be
liable to such indemnified party under these
indemnification provisions for any legal expenses
of other counsel or any other expenses, in each
case subsequently incurred by such indemnified
party, in connection with the defense thereof other
than reasonable costs of investigation, unless in
the reasonable judgment of such indemnified party
a conflict of interest may exist between such
indemnified party and any other of such
indemnified parties with respect to such claim, in
which event the indemnifying party shall be
obligated to pay the fees and expenses of one
additional counsel. The indemnifying party will
not be subject to any liability for any settlement
made without its consent (which will not be
unreasonably withheld).
Section 7.2 Notification. The
Company agrees promptly to notify each
Purchaser of the commencement of any litigation
or proceeding against it or any of its officers or
directors in connection with the issue and sale of
any of the Securities, or in any way related or
attributed to this Agreement.
ARTICLE VIII
MISCELLANEOUS
Section 8.1 Home Office Payment.
The Company agrees that, so long as any
Purchaser (including Substitute Purchasers)
hereunder shall own the Securities purchased by it
hereunder and, notwithstanding any provision in
the Indenture to the contrary, the Company will
make any payments to such Purchaser of principal,
premium, if any, and interest due thereon by
check or wire transfer, at the election of the
Purchaser, in immediately available funds by
12:00 noon, New York time, at the location of
such Purchaser's account, on the date of payment
to such account as specified by separate written
notice to the Company by such Purchaser
(providing sufficient information with such wire
transfer to identify the source and application of
the funds and requesting the bank to send a credit
advice thereof to such Purchaser), or to such other
account or in such other similar manner as such
Purchaser may designate to the Company in
writing. Each Purchaser electing to have home
office payments hereby agrees that before selling,
transferring or otherwise disposing of any such
Security, it will make a notation thereon, or
submit the same to the applicable Trustee for
notation thereon, of the date to which interest has
been paid thereon and the amount of all
redemptions previously made in respect thereof, or
surrender the same to such Trustee in exchange
for a Security or Securities aggregating the same
principal amount as the unredeemed principal
amount of the Securities surrendered.
Section 8.2 Termination. This
Agreement may be terminated (as to the party
electing to so terminate it) at any time prior to the
Time of Purchase:
(a) by the Company and
the Parent if any of the conditions
specified in Section 4.2 of this
Agreement have not been met or
waived by it pursuant to the terms
of this Agreement by April 30,
1997 or at such earlier date that it
becomes apparent that any such
condition can no longer be satisfied;
(b) by any Purchaser if
any of the conditions specified in
Section 4.1 of this Agreement have
not been met or waived pursuant to
the terms of this Agreement by
April 30, 1997 or at such earlier
date that it becomes apparent that
any such condition can no longer be
satisfied.
Section 8.3 No Waiver;
Modifications in Writing. No failure or delay on
the part of the Company or the Parent or any
Purchaser in exercising any right, power or
remedy hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of
any such right, power or remedy preclude any
other or further exercise thereof or the exercise of
any other right, power or remedy. The remedies
provided for herein are cumulative and are not
exclusive of any remedies that may be available to
the parties hereto at law or in equity or otherwise.
No waiver of or consent to any departure by the
Company or the Parent from any provision of this
Agreement shall be effective unless signed in
writing by the party entitled to the benefit thereof,
provided that notice of any such waiver shall be
given to each party hereto as set forth below.
Except as otherwise provided herein, no
amendment, modification or termination of any
provision of this Agreement shall be effective
unless signed in writing by or on behalf of each
Purchaser. Any amendment, supplement or
modification of or to any provision of this
Agreement, any waiver of any provision of this
Agreement, and any consent to any departure by
the Company or the Parent from the terms of any
provision of this Agreement, shall be effective
only in the specific instance and for the specific
purpose for which made or given. Except where
notice is specifically required by this Agreement,
no notice to or demand on the Company or the
Parent in any case shall entitle the Company or
the Parent to any other or further notice or
demand in similar or other circumstances.
Section 8.4 Communications. All
notices, demands and other communications
provided for hereunder shall be in writing, and, if
to the Purchasers, shall be given by registered or
certified mail, return receipt requested, telecopy,
courier service or personal delivery, addressed to
each Purchaser as shown on the execution pages
hereof or to such other address as such Purchaser
may designate to the Company in writing and, if
to the Company or the Parent, shall be given by
similar means to Aegis Auto Finance, Inc., c/o
The Aegis Consumer Funding Group, Inc., 000
Xxxxxxxxxx Xxxxxxxxx, 00xx Xxxxx, Xxxxxx Xxxx,
Xxx Xxxxxx 00000, Attention: Executive Vice
President and General Counsel, or to such other
address as the Company may designate in writing,
and shall be deemed given when received. A
copy of any notice hereunder shall be provided to
the Trustee at the address set forth in the
Indenture.
Section 8.5 Costs, Expenses and
Taxes. The Company agrees to pay all costs and
expenses in connection with the negotiation,
preparation, printing, typing, reproduction,
execution and delivery of this Agreement, each of
the Basic Documents, any amendment or
supplement to or modification of any of the
foregoing, and any and all other documents
furnished pursuant hereto or thereto or in
connection herewith or therewith, excluding the
fees and expenses of counsel retained by the
Purchasers in connection herewith, all reasonable
costs and expenses in connection with the
administration of this Agreement and all costs and
expenses (including, without limitation, reasonable
attorneys' fees and expenses), if any, in
connection with the enforcement of this
Agreement, the Securities, any of the Basic
Documents, or any other agreement furnished
pursuant hereto or thereto or in connection
herewith or therewith. In addition, the Company
shall pay any and all stamp, transfer and other
similar taxes payable or determined to be payable
in connection with the execution and delivery of
this Agreement or the original issuance of the
Securities, and shall save and hold each Purchaser
harmless from and against any and all liabilities
with respect to or resulting from any delay in
paying, or omission to pay, such taxes. The
Company shall bear all expenses of shipping the
Securities (including, without limitation, insurance
expenses) from New York City to such other
places within the United States of America as any
Purchaser shall specify.
Section 8.6 Execution in
Counterparts. This Agreement may be executed
in any number of counterparts and by different
parties hereto on separate counterparts, each of
which counterparts, when so executed and
delivered, shall be deemed to be an original and
all of which counterparts, taken together, shall
constitute but one and the same Agreement.
Section 8.7 Binding Effect;
Assignment. Subject to Article VI hereof, prior
to the Time of Purchase the rights and obligations
of any Purchaser under this Agreement may not be
assigned to any other Person except with the prior
consent of the Company, which shall not be
unreasonably withheld. Except as expressly
provided in this Agreement, this Agreement shall
not be construed so as to confer any right or
benefit upon any Person other than the parties to
this Agreement, and their respective successors
and assigns. This Agreement shall be binding
upon the Company and each Purchaser, and their
successors and assigns.
Section 8.8 Governing Law. This
Agreement shall be deemed to be a contract made
under the laws of the State of New York, and for
all purposes shall be construed in accordance with
the laws of said State, without regard to principles
of conflicts of law. Each of the parties hereto
agrees to submit to the jurisdiction of the federal
and state courts sitting in the State of New York
in any action or proceeding arising out of or
relating to this Agreement.
Section 8.9 Severability of
Provisions. Any provision of this Agreement
which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or
unenforceability without invalidating the
remaining provisions hereof or affecting the
validity or enforceability of such provision in any
other Jurisdiction.
Section 8.10 Article and Section
Headings. The Article and Section headings used
or contained in this Agreement are for
convenience of reference only and shall not affect
the construction of this Agreement.
Section 8.11 Attorneys' Fees. In
any action or proceeding brought to enforce any
provision of this Agreement or any of the Basic
Documents, or where any provision hereof or
thereof is validly asserted as a defense, the
successful party shall be entitled to recover
reasonable attorneys' fees in addition to any other
available remedy.
Section 8.12 No Recourse Against
Others. A director, officer, employee or
stockholder, as such, of the Company or the
Parent shall not have any liability for any
obligations of the Company or the Parent under
the Securities or this Agreement or for any claim
based on, in respect of or by reason of such
obligations or their creation. Each Purchaser by
accepting a Security waives and releases all such
liability.
PURCHASE AGREEMENT SIGNATURE PAGE
IN WITNESS WHEREOF the
parties hereto have caused this Agreement to be
executed by their respective officers hereunder
duly authorized, as of the date first above written.
AEGIS AUTO FINANCE, INC.
By:
Name:
Title:
THE AEGIS CONSUMER FUNDING GROUP,
INC.
By:
Name:
Title:
Accepted and Agreed as of
the date first above written
Name of Purchaser
By:
Name:
Title:
Aggregate principal amount of
Securities to be purchased by
Purchaser
$
Designated Bank
Account No.
Attention:
Taxpayer I.D. No.
Nominee (name in which Securities are to
be registered, if different than name of
Purchaser)
AEGIS AUTO FINANCE, INC.
NOTE PURCHASE AGREEMENT
Dated as of April , 1997
$21,333,333 of Debentures
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