EXECUTION COPY
Alltrista Corporation
The guarantors party hereto
$150,000,000
9 3/4% Senior Subordinated Notes due 2012
Purchase Agreement
dated April 10, 0000
Xxxx xx Xxxxxxx Securities LLC
CIBC World Markets Corp.
NatCity Investments, Inc.
Table of Contents
SECTION 1. Representations and Warranties.........................................................3
(a) No Registration Required........................................................................3
(b) No Integration of Offerings or General Solicitation.............................................3
(c) Eligibility for Resale under Rule 144A..........................................................3
(d) The Offering Memorandum.........................................................................3
(e) The Purchase Agreement..........................................................................4
(f) The Registration Rights Agreement and DTC Agreement.............................................4
(g) Authorization of the Credit Agreement...........................................................4
(h) Authorization of the Seller Notes...............................................................4
(i) Authorization of the Acquisition................................................................5
(j) Acquisition Agreement...........................................................................5
(k) Authorization of the Securities and the Exchange Securities.....................................5
(l) Authorization of the Indenture..................................................................5
(m) Description of the Securities and the Indenture...............................................6
(n) No Material Adverse Change....................................................................6
(o) Independent Accountants.........................................................................6
(p) Preparation of the Financial Statements.........................................................6
(q) Incorporation and Good Standing of the Company, the Guarantors and their Respective Subsidiaries7
(r) Capitalization..................................................................................7
(s) Stock Exchange Listing..........................................................................7
(t) Non-Contravention of Existing Instruments; No Further Authorizations or Approvals Required......8
(u) No Material Actions or Proceedings............................................................8
(v) Intellectual Property Rights....................................................................9
(w) All Necessary Permits, etc....................................................................9
(x) Title to Properties.............................................................................9
(y) Tax Law Compliance..............................................................................9
(z) Company Not an "Investment Company"............................................................10
(aa) Insurance....................................................................................10
(bb) No Price Stabilization or Manipulation.......................................................10
(cc) Company's Accounting System..................................................................10
(dd) Compliance with Environmental Laws...........................................................10
(ee) Periodic Review of Costs of Environmental Compliance.........................................11
(ff) ERISA Compliance.............................................................................11
(gg) No Default in Senior Indebtedness............................................................12
(hh) Compliance with Regulation S.................................................................12
(ii) Reporting Issuer.............................................................................12
(jj) Other Representations and Warranties.........................................................12
SECTION 2. Purchase, Sale and Delivery of the Securities.........................................13
(a) The Securities.................................................................................13
(b) The Closing Date...............................................................................13
(c) Delivery of the Securities.....................................................................13
(d) Delivery of Offering Memorandum to the Initial Purchasers......................................13
(e) Initial Purchasers as Qualified Institutional Buyers...........................................13
SECTION 3. Additional Covenants..................................................................14
(a) Initial Purchasers' Review of Proposed Amendments and Supplements..............................14
(b) Amendments and Supplements to the Offering Memorandum and Other Securities Act Matters.........14
(c) Copies of the Offering Memorandum..............................................................15
(d) Blue Sky Compliance............................................................................15
(e) Use of Proceeds................................................................................15
(f) The Depositary.................................................................................15
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(g) Additional Issuer Information..................................................................15
(h) Agreement Not To Offer or Sell Additional Securities...........................................15
(i) Future Reports to the Initial Purchasers.......................................................16
(j) No Integration.................................................................................16
(k) Legended Securities............................................................................16
(l) PORTAL.........................................................................................16
(m) Acquisition..................................................................................16
(n) Contingent Payment Debt Instruments..........................................................16
SECTION 4. Payment of Expenses...................................................................17
SECTION 5. Conditions of the Obligations of the Initial Purchasers...............................17
(a) Accountants' Comfort Letter....................................................................17
(b) No Material Adverse Change or Ratings Agency Change............................................18
(c) Opinion of Counsel for the Company.............................................................18
(d) Opinion of Counsel for the Initial Purchasers..................................................18
(e) Officers' Certificate..........................................................................18
(f) Bring-down Comfort Letter......................................................................18
(g) PORTAL Listing.................................................................................19
(h) Registration Rights Agreement..................................................................19
(i) Indenture......................................................................................19
(j) Acquisition Agreement..........................................................................19
(k) Credit Agreement...............................................................................19
(l) Additional Documents...........................................................................19
SECTION 6. Reimbursement of Initial Purchasers' Expenses.........................................20
SECTION 7. Offer, Sale and Resale Procedures.....................................................20
SECTION 8. Indemnification.......................................................................21
(a) Indemnification of the Initial Purchasers......................................................21
(b) Indemnification of the Company, the Guarantors, their Directors and Officers...................22
(c) Notifications and Other Indemnification Procedures.............................................23
(d) Settlements....................................................................................23
SECTION 9. Contribution..........................................................................24
SECTION 10. Termination of this Agreement.........................................................25
SECTION 11. Representations and Indemnities to Survive Delivery...................................25
SECTION 12. Notices...............................................................................26
SECTION 13. Successors............................................................................27
SECTION 14. Partial Unenforceability..............................................................27
SECTION 15. Governing Law Provisions..............................................................27
(a) Consent to Jurisdiction........................................................................27
SECTION 16. Default of One or More of the Several Initial Purchasers..............................28
SECTION 17. General Provisions....................................................................28
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Purchase Agreement
April 10, 0000
XXXX XX XXXXXXX SECURITIES LLC
CIBC WORLD MARKETS CORP.
NatCity Investments, Inc.
As representatives of the several Initial Purchasers c/o BANC OF AMERICA
SECURITIES LLC 0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Alltrista Corporation, a Delaware corporation (the "Company"),
proposes to issue and sell to the several Initial Purchasers named in Schedule A
(the "Initial Purchasers"), acting severally and not jointly, the respective
amounts set forth in such Schedule A of the Company's 9 3/4% Senior Subordinated
Notes due 2012 (the "Notes"). Banc of America Securities LLC, CIBC World Markets
Corp. and NatCity Investments, Inc. have agreed to act as the representatives of
the several Initial Purchasers in connection with the offering and sale of the
Notes.
The Notes will be issued pursuant to an indenture, to be dated
as of April 24, 2002 (the "Indenture"), among the Company, the Guarantors (as
defined below) and The Bank of New York, as trustee (the "Trustee"). Notes
issued in book-entry form will be issued in the name of Cede & Co., as nominee
of The Depository Trust Company (the "Depositary") pursuant to a DTC Agreement,
to be dated as of the Closing Date (as defined in Section 2) (the "DTC
Agreement"), among the Company, the Trustee and the Depositary.
The holders of the Notes will be entitled to the benefits of a
registration rights agreement, to be dated as of April 24, 2002 (the
"Registration Rights Agreement"), among the Company, the Guarantors (as defined
below) and the Initial Purchasers, pursuant to which the Company will agree to
file, within 60 days of the Closing Date, a registration statement with the
Commission registering the Exchange Securities (as defined below) under the
Securities Act of 1933 (as amended, the "Securities Act," which term, as used
herein, includes the rules and regulations of the Commission promulgated
thereunder).
The payment of principal, premium and Liquidated Damages (as
defined in the Indenture), if any, and interest on the Notes and the Exchange
Notes (as defined below) will be fully and unconditionally guaranteed on a
senior unsecured basis, jointly and severally, by (i) the parties named in
Schedule B and (ii) any subsidiary of the Company or any party named in Schedule
B formed or acquired after the Closing Date that executes an additional
guarantee in accordance with the terms of the Indenture, and their respective
successors and assigns (collectively, the "Guarantors"), pursuant to their
guarantees (the "Guarantees"). The Notes and the Guarantees attached thereto are
herein collectively referred to as the "Securities"; and the Exchange Notes and
the Guarantees attached thereto are herein collectively referred to as the
"Exchange Securities."
The Securities are being issued and sold in connection with
the acquisition by the Company of substantially all of the assets and
liabilities of Tilia International, Inc. and its subsidiaries, Tilia, Inc. and
Tilia Canada, Inc. (the "Acquisition"), pursuant to an asset purchase agreement
dated as of March 27, 2002 (the "Acquisition Agreement"). In order to (a) pay
for the Acquisition, (b) repay its existing revolving credit facility and
existing five-year term loan facility (together, the "Existing Senior Credit
Facility") and (c) pay related fees and expenses, the Company expects (i) to
enter into new term loan and revolving credit facilities in the amounts of $50.0
million and $50.0 million, respectively, with none of the revolving credit
facility expected to be drawn upon the closing of the Acquisition (collectively,
the "New Senior Credit Facility") pursuant to a credit agreement among the
Company, the Guarantors and the lenders party thereto (the "Credit Agreement")
and (ii) to issue an unsecured subordinated seller note due 2003 payable to
Tilia International, Inc. in the principal amount of $10.0 million and an
unsecured subordinated seller note due 2004 payable to Tilia International, Inc.
in the principal amount of $5.0 million (collectively, the "Seller Notes"). As
used herein, the term "the Transaction" means collectively (x) the offering of
the Securities, (y) entering into the New Senior Credit Facility and (z) the
Acquisition.
The net proceeds from the offering of the Notes (the "Net
Proceeds") will be deposited with the Trustee pending the consummation of the
Transaction. If the Transaction is terminated or is not consummated on or prior
to July 15, 2002 (the "Special Mandatory Redemption Date"), (i) the Company will
be obligated to redeem the Notes at a special mandatory redemption price of 101%
of the aggregate principal amount of the Notes, plus accrued interest on the
Notes (the "Special Mandatory Redemption Price"), and (ii) the Company and the
Guarantors will provide, if and when due, the difference between the Net
Proceeds and the Special Mandatory Redemption Price.
The Company understands that the Initial Purchasers propose to
make an offering of the Securities on the terms and in the manner set forth
herein and in the Offering Memorandum (as defined below) and agrees that the
Initial Purchasers may resell, subject to the conditions set forth herein, all
or a portion of the Securities to purchasers (the "Subsequent Purchasers") at
any time after the date of this Agreement. The Securities are to be offered and
sold to or through the Initial Purchasers without being registered with the
Securities and Exchange Commission (the "Commission") under the Securities Act
in reliance upon exemptions therefrom. The terms of the Securities and the
Indenture will require that investors that acquire Securities expressly agree
that Securities may only be resold or otherwise transferred, after the date
hereof, if such Securities are registered for sale under the Securities Act or
if an exemption from the registration requirements of the Securities Act is
available (including the exemptions afforded by Rule 144A ("Rule 144A") or
Regulation S ("Regulation S") thereunder).
The Company has prepared and delivered to each Initial
Purchaser copies of a Preliminary Offering Memorandum, dated March 28, 2002 (the
"Preliminary Offering Memorandum"), and has prepared and will deliver to each
Initial Purchaser, copies of the Offering Memorandum, dated April 10, 2002
describing the terms of the Securities, each for use by such Initial Purchaser
in connection with its solicitation of offers to purchase the Securities. As
used herein, the "Offering Memorandum" shall mean, with respect to any date or
time referred to in this Agreement, the Company's Offering Memorandum, dated
April 10, 2002, including amendments or supplements thereto and any exhibits
thereto, in the most recent form that has been prepared and delivered by the
Company to the Initial Purchasers in connection with their solicitation of
offers to purchase Securities. Further, any reference to the Preliminary
Offering Memorandum or the Offering Memorandum shall be deemed to refer to and
include any Additional Issuer Information (as defined in Section 3) furnished by
the Company prior to the completion of the distribution of the Securities.
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The Company and each of the Guarantors hereby confirm their
agreements with the Initial Purchasers as follows:
Representations and Warranties. Each of the Company and the
Guarantors, jointly and severally, hereby represent, warrant and covenant to
each Initial Purchaser as follows:
No Registration Required. Subject to compliance by the Initial
Purchasers with the representations and warranties set forth in Section 2 hereof
and with the procedures set forth in Section 7 hereof, it is not necessary in
connection with the offer, sale and delivery of the Securities to the Initial
Purchasers and to each Subsequent Purchaser in the manner contemplated by this
Agreement and the Offering Memorandum to register the Securities under the
Securities Act or, until such time as the Exchange Securities are issued
pursuant to an effective registration statement, to qualify the Indenture under
the Trust Indenture Act of 0000 (xxx "Xxxxx Xxxxxxxxx Xxx," which term, as used
herein, includes the rules and regulations of the Commission promulgated
thereunder).
No Integration of Offerings or General Solicitation. Neither
the Company nor any Guarantor has, directly or indirectly, solicited any offer
to buy or offered to sell, nor will, directly or indirectly, solicit any offer
to buy or offer to sell, in the United States or to any United States citizen or
resident, any security that is or would be integrated with the sale of the
Securities in a manner that would require the Securities to be registered under
the Securities Act. None of the Company or the Guarantors, their respective
affiliates (as such term is defined in Rule 501 under the Securities Act (each,
an "Affiliate"), or any person acting on any of their respective behalf (other
than the Initial Purchasers, as to whom the Company and the Guarantors make no
representation or warranty) has engaged or will engage, in connection with the
offering of the Securities, in any form of general solicitation or general
advertising within the meaning of Rule 502 under the Securities Act. With
respect to those Securities sold in reliance upon Regulation S, (i) none of the
Company, the Guarantors, their respective Affiliates or any person acting on any
of their respective behalf (other than the Initial Purchasers, as to whom the
Company and the Guarantors make no representation or warranty) has engaged or
will engage in any directed selling efforts within the meaning of Regulation S
and (ii) each of the Company, the Guarantors and their respective Affiliates and
any person acting on any of their respective behalf (other than the Initial
Purchasers, as to whom the Company and the Guarantors make no representation or
warranty) has complied and will comply with the offering restrictions set forth
in Regulation S.
Eligibility for Resale under Rule 144A. The Securities are
eligible for resale pursuant to Rule 144A and will not be, at the Closing Date,
of the same class as securities listed on a national securities exchange
registered under Section 6 of the Exchange Act or quoted in a U.S. automated
interdealer quotation system.
The Offering Memorandum. The Offering Memorandum does not, and
at the Closing Date will not, include an untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading;
provided that this representation, warranty and agreement shall not apply to
statements in or omissions from the Offering Memorandum made in reliance upon
and in conformity with information furnished to the Company in writing by any
Initial Purchaser through Banc of America Securities LLC expressly for use in
the Offering Memorandum. Each of the Preliminary Offering Memorandum and the
Offering Memorandum, as of its date, contains all the information specified in,
and meeting the requirements of, Rule 144A. Neither the Company nor any
Guarantor has distributed or will distribute, prior to the later of the Closing
Date and the completion of the Initial Purchasers' distribution of the
Securities, any offering material in connection with the offering and sale of
the Securities other
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than a Preliminary Offering Memorandum or the Offering Memorandum.
The Purchase Agreement. This Agreement has been duly
authorized, executed and delivered by, and is a valid and binding agreement of,
the Company and the Guarantors, enforceable against the Company and the
Guarantors in accordance with its terms, except as rights to indemnification
hereunder may be limited by applicable law and except as the enforcement hereof
may be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting the rights and remedies of creditors or by
general equitable principles and except as rights to indemnification under the
Registration Rights Agreement may be limited by applicable law.
The Registration Rights Agreement and DTC Agreement. At the
Closing Date, each of the Registration Rights Agreement and the DTC Agreement
will be duly authorized, executed and delivered by, and will be a valid and
binding agreement of, (i) in the case of the Registration Rights Agreement, the
Company and the Guarantors, enforceable against the Company and the Guarantors
in accordance with its terms, and (ii) in the case of the DTC Agreement, the
Company, enforceable against the Company in accordance with its terms, except in
both cases as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the
rights and remedies of creditors or by general equitable principles and except
as rights to indemnification under the Registration Rights Agreement may be
limited by applicable law.
Authorization of the Credit Agreement. The Credit Agreement
has been duly and validly authorized by the Company and each of the Guarantors
and, when duly executed and delivered by the Company and each of the Guarantors,
will be the valid and legally binding obligation of the Company and each of the
Guarantors, enforceable in accordance with its terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws relating to or affecting the rights and remedies of creditors
or by general equitable principles.
Authorization of the Seller Notes. The Seller Notes have been
duly and validly authorized by the Company and, when duly executed and delivered
by the Company, will be the valid and legally binding obligation of the Company,
enforceable in accordance with their terms, except as the enforcement thereof
may be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting the rights and remedies of creditors or by
general equitable principles.
Authorization of the Acquisition. The Acquisition has been
duly authorized by all necessary corporate action of the Company including, to
the extent required by applicable law, all necessary action by its board of
directors and stockholders.
Acquisition Agreement. The Acquisition Agreement has been duly
authorized, executed and delivered by, and is a valid and binding obligation of,
the Company, enforceable against the Company in accordance with its terms,
except as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the
rights and remedies of creditors or by general equitable principles.
Authorization of the Securities and the Exchange Securities.
(i) The Notes to be purchased by the Initial Purchasers from
the Company are in the form contemplated by the Indenture, have been duly
authorized for issuance and sale pursuant to this Agreement and the Indenture
and, when executed by the Company and
4
authenticated by the Trustee in the manner provided for in the Indenture and
delivered against payment of the purchase price therefor, will constitute valid
and binding agreements of the Company, enforceable in accordance with their
terms, except as the enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating to or
affecting the rights and remedies of creditors or by general equitable
principles and will be entitled to the benefits of the Indenture.
(ii) The Exchange Notes have been duly and validly authorized
for issuance by the Company, and when issued and authenticated in accordance
with the terms of the Indenture, the Registration Rights Agreement and the
Exchange Offer, will constitute valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium, or similar laws relating to or affecting enforcement of the rights
and remedies of creditors or by general principles of equity and will be
entitled to the benefits of the Indenture.
(iii) The Guarantees of the Notes and the Exchange Notes are
in the respective forms contemplated by the Indenture, have been duly authorized
for issuance and sale pursuant to this Agreement and the Indenture and, when
executed by each of the Guarantors and authenticated by the Trustee in the
manner provided for in the Indenture and delivered against payment of the
purchase price therefor, will constitute valid and binding agreements of the
Guarantors, enforceable in accordance with their terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the rights and
remedies of creditors or by general equitable principles and will be entitled to
the benefits of the Indenture.
Authorization of the Indenture. The Indenture has been duly
authorized by the Company and the Guarantors and, when duly executed and
delivered by the Company and the Guarantors and will constitute a valid and
binding agreement of the Company and the Guarantors, enforceable against the
Company and the Guarantors in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the rights and
remedies of creditors or by general equitable principles.
Description of the Securities and the Indenture. The Notes,
the Exchange Notes, the Guarantees of the Notes and the Exchange Notes and the
Indenture will conform in all material respects to the respective statements
relating thereto contained in the Offering Memorandum.
No Material Adverse Change. Except as otherwise disclosed in
the Offering Memorandum, subsequent to the respective dates as of which
information is given in the Offering Memorandum: (i) there has been no material
adverse change, or any development that could reasonably be expected to result
in a material adverse change, in the condition, financial or otherwise, or in
the earnings, business, operations or prospects, whether or not arising from
transactions in the ordinary course of business, of the Company, the Guarantors,
and their respective subsidiaries, considered as one entity (any such change is
called a "Material Adverse Change"); (ii) the Company, the Guarantors and their
respective subsidiaries, considered as one entity, have not incurred any
material liability or obligation, indirect, direct or contingent, not in the
ordinary course of business nor entered into any material transaction or
agreement not in the ordinary course of business; and (iii) there has been no
dividend or distribution of any kind declared, paid or made by the Company or,
except for dividends paid to the Company, the Guarantors or their respective
subsidiaries, by any of the Guarantors, the subsidiaries of the
5
Guarantors or the subsidiaries of the Company on any class of capital stock or
repurchase or redemption by the Company, the Guarantors or their respective
subsidiaries of any class of capital stock.
Independent Accountants. Each of Ernst & Young LLP, who have
expressed their opinion with respect to the financial statements of the Company
and its subsidiaries (which term as used in this Agreement includes the related
notes thereto) included in the Offering Memorandum, and Xxxxxx Xxxxxxxx LLP, who
have expressed their opinion with respect to the financial statements of Tilia
International, Inc. and its subsidiaries included in the Offering Memorandum,
are independent public or certified public accountants within the meaning of
Regulation S-X under the Securities Act and the Exchange Act.
Preparation of the Financial Statements. The financial
statements, together with the related schedules and notes, included in the
Offering Memorandum present fairly in all material respects the consolidated
financial position of each of (i) the Company, the Guarantors and their
respective subsidiaries and (ii) Tilia International, Inc. and its subsidiaries
as of and at the dates indicated and the results of their operations and cash
flows for the periods specified. Such financial statements have been prepared in
conformity with generally accepted accounting principles as applied in the
United States applied on a consistent basis throughout the periods involved,
except as may be expressly stated in the related notes thereto. The financial
data set forth in the Offering Memorandum under the captions "Offering
Memorandum Summary--Summary Consolidated Historical and Pro Forma Financial and
Operating Data" and "Selected Historical and Financial Data" fairly present in
all material respects the information set forth therein on a basis consistent
with that of the audited financial statements contained in the Offering
Memorandum. The pro forma condensed consolidated financial statements of the
Company, the Guarantors and their respective subsidiaries and the related notes
thereto included under the captions "Offering Memorandum Summary--Summary
Consolidated Historical and Pro Forma Financial and Operating Data" and
"Unaudited Pro Forma Condensed Consolidated Financial Statements" and included
elsewhere in the Offering Memorandum present fairly in all material respects the
information contained therein, have been prepared in accordance with the
Commission's rules and guidelines with respect to pro forma financial statements
and have been properly presented in all material respects on the bases described
therein, and the assumptions used in the preparation thereof are appropriate in
all material respects to give effect to the transactions and circumstances
referred to therein.
Incorporation and Good Standing of the Company, the Guarantors
and their Respective Subsidiaries. Each of the Company, the Guarantors and their
respective subsidiaries has been duly incorporated or formed, as applicable, and
is validly existing as a corporation or limited partnership, as the case may be,
in good standing under the laws of the jurisdiction of its incorporation or
formation and has corporate power or limited partnership power, as the case may
be, and authority to own, lease and operate its properties and to conduct its
business as described in the Offering Memorandum and, in the case of the Company
and each of the Guarantors, to enter into and perform their respective
obligations under each of this Agreement, the Registration Rights Agreement, the
Securities, the Exchange Securities, the Indenture and the Credit Agreement,
and, in the case of the Company, to enter into and perform its obligations under
the DTC Agreement and the Acquisition Agreement. Each of the Company, the
Guarantors and their respective subsidiaries is duly qualified as a foreign
corporation or limited partnership, as the case may be, to transact business and
is in good standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business, except for such jurisdictions where the failure to so
qualify or to be in good standing would not, individually or in the aggregate,
result in a Material Adverse Change. All of the issued and outstanding capital
stock or limited partnership interests,
6
as applicable, of each subsidiary has been duly authorized and validly issued,
is fully paid and nonassessable and, is owned by the Company, directly or
through subsidiaries, free and clear of any security interest, mortgage, pledge,
lien, encumbrance or claim, except for security interests, mortgages, pledges,
liens, encumbrances or claims in connection with the Existing Senior Credit
Facility and the New Senior Credit Facility. The Company does not own or
control, directly or indirectly, any corporation, association or other entity
other than the subsidiaries listed in Schedule C hereto.
Capitalization. At December 31, 2001, on a consolidated basis,
after giving pro forma effect to the issuance and sale of the Securities
pursuant hereto, the Company would have an authorized and outstanding
capitalization as set forth in the Offering Memorandum under the caption
"Capitalization" (other than for subsequent issuances of capital stock, if any,
pursuant to employee benefit plans described in the Offering Memorandum or upon
exercise of outstanding options described in the Offering Memorandum).
Stock Exchange Listing. The Common Stock is registered
pursuant to Section 12b of the Exchange Act and is listed on the New York Stock
Exchange (the "NYSE"), and the Company has taken no action designed to, or
likely to have the effect of, terminating the registration of the Common Stock
under the Exchange Act or delisting the Common Stock from the NYSE, nor has the
Company received any notification that the Commission or the NYSE is
contemplating terminating such registration or listing.
Non-Contravention of Existing Instruments; No Further
Authorizations or Approvals Required. None of the Company, the Guarantors or any
of their respective subsidiaries is in violation of its charter or by-laws or is
in default (or, with the giving of notice or lapse of time, would be in default)
("Default") under any indenture, mortgage, loan or credit agreement, note,
contract, franchise, lease or other instrument to which the Company, the
Guarantors or any of their respective subsidiaries is a party or by which any of
them may be bound (including, without limitation, the Company's Existing Senior
Credit Facility and letters of credit issued thereunder), or to which any of the
property or assets of the Company, the Guarantors or any of their respective
subsidiaries is subject (each, an "Existing Instrument"), except for such
Defaults as would not, individually or in the aggregate, result in a Material
Adverse Change. The Company's and the Guarantors' execution, delivery and
performance of this Agreement, the Registration Rights Agreement, the Indenture
(including, without limitation, redemption of the Securities at the Special
Mandatory Redemption Price), and the Credit Agreement, the Company's execution,
delivery and performance of the DTC Agreement, the Seller Notes and the
Acquisition Agreement, and the issuance and delivery of the Securities or the
Exchange Securities, and consummation of the transactions contemplated hereby
and thereby and by the Offering Memorandum (i) have been duly authorized by all
necessary corporate action and will not result in any violation of the
provisions of the charter or by-laws of the Company, the Guarantors or any of
their respective subsidiaries, (ii) will not conflict with or constitute a
breach of, or Default under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the Company, the
Guarantors or any of their respective subsidiaries pursuant to, or require the
consent of any other party to, any Existing Instrument, except for such
conflicts, breaches, Defaults, liens, charges or encumbrances as would not,
individually or in the aggregate, result in a Material Adverse Change and
except, with respect to the Existing Senior Credit Facility, as waived in
accordance with the terms thereof, and (iii) will not result in any violation of
any law, administrative regulation or administrative or court decree applicable
to the Company, the Guarantors or any of their respective subsidiaries. No
consent, approval, authorization or other order of, or registration or filing
with, any court or other governmental or regulatory authority or agency, is
required for the Company's or the Guarantors' execution, delivery and
performance of this Agreement, the Registration Rights
7
Agreement, the DTC Agreement, the Indenture (including, without limitation,
redemption of the Securities at the Special Mandatory Redemption Price), the
Credit Agreement, the Seller Notes, or the Acquisition Agreement, as applicable,
or the issuance and delivery of the Securities or the Exchange Securities, or
consummation of the transactions contemplated hereby and thereby and by the
Offering Memorandum, except such as have been obtained or made by the Company or
the Guarantors and are in full force and effect under the Securities Act,
applicable state securities or blue sky laws and except such as may be required
by federal and state securities laws with respect to the Company's or the
Guarantors' obligations under the Registration Rights Agreement.
No Material Actions or Proceedings. Except as otherwise
disclosed in the Offering Memorandum, there are no legal or governmental
actions, suits or proceedings pending or, to the best of the Company's or any
Guarantor's knowledge, threatened (i) against or affecting the Company, the
Guarantors or any of their respective subsidiaries or (ii) that has as the
subject thereof any property owned or leased by, the Company, the Guarantors or
any of their respective subsidiaries, where in any such case (x) there is a
reasonable possibility that such action, suit or proceeding might be determined
adversely to the Company, any Guarantor or any such subsidiary and (y) any such
action, suit or proceeding, if so determined adversely, would reasonably be
expected to result in a Material Adverse Change or adversely affect the
consummation of the transactions contemplated by this Agreement. No material
labor dispute with the employees of the Company, the Guarantors or any of their
respective subsidiaries, or with the employees of any principal supplier of the
Company, exists or, to the best of the Company's or any Guarantor's knowledge,
is threatened or imminent.
Intellectual Property Rights. The Company, the Guarantors and
their respective subsidiaries own or possess sufficient trademarks, trade names,
patent rights, copyrights, licenses, approvals, trade secrets and other similar
rights (collectively, "Intellectual Property Rights") reasonably necessary to
conduct their businesses as now conducted; and the expected expiration of any of
such Intellectual Property Rights would not result in a Material Adverse Change.
None of the Company, the Guarantors or any of their respective subsidiaries has
received any notice of infringement or conflict with asserted Intellectual
Property Rights of others, which infringement or conflict, if the subject of an
unfavorable decision, would result in a Material Adverse Change.
All Necessary Permits, etc. Each of the Company, the
Guarantors and their respective subsidiaries possesses such valid and current
certificates, authorizations or permits issued by the appropriate state, federal
or foreign regulatory agencies or bodies necessary to conduct their respective
businesses, except where failure to possess such certificates, authorizations or
permits could not reasonably be expected to have a material adverse effect on
such businesses, and none of the Company, the Guarantors, or any of their
respective subsidiaries has received any notice of proceedings relating to the
revocation or modification of, or non-compliance with, any such certificate,
authorization or permit that, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, could result in a Material Adverse
Change.
Title to Properties. The Company, the Guarantors and each of
their respective subsidiaries have good and marketable title to all the
properties and assets reflected as owned in the financial statements referred to
in Section 1 above (and elsewhere in the Offering Memorandum), in each case free
and clear of any security interests, mortgages, liens, encumbrances, equities,
claims and other defects, except such as do not materially and adversely affect
the value of such property and do not materially interfere with the use made or
proposed to be made of such property by the Company, such Guarantor or such
subsidiary. The real
8
property, improvements, equipment and personal property held under lease by the
Company, the Guarantors or any of their respective subsidiaries are held under
valid and enforceable leases, with such exceptions as are not material and do
not materially interfere with the use made or proposed to be made of such real
property, improvements, equipment or personal property by the Company, such
Guarantor or such subsidiary.
Tax Law Compliance. The Company and its consolidated
subsidiaries (including the Guarantors) have filed all necessary federal, state
and foreign income and franchise tax returns and have paid all taxes required to
be paid by any of them and, if due and payable, any related or similar
assessment, fine or penalty levied against any of them (except taxes,
assessments, fines or penalties the validity of which the Company is contesting
in good faith). The Company has made adequate charges, accruals and reserves in
the applicable financial statements referred to in Section 1 above in respect of
all federal, state and foreign income and franchise taxes for all periods as to
which the tax liability of the Company or any of its consolidated subsidiaries
(including the Guarantors) has not been finally determined.
Company Not an "Investment Company". The Company has been
advised of the rules and requirements under the Investment Company Act of 1940,
as amended (the "Investment Company Act"). The Company is not, and after receipt
of payment for the Securities will not be, an "investment company" within the
meaning of Investment Company Act and will conduct its business in a manner so
that it will not become subject to the Investment Company Act.
Insurance. Each of the Company, the Guarantors and their
respective subsidiaries are insured by recognized, financially sound
institutions with policies in such amounts and with such deductibles and
covering such risks as are, in the opinion of the Company, adequate for their
businesses. Each of the Company and the Guarantors have no reason to believe
that it or any of its respective subsidiaries will not be able (i) to renew its
existing insurance coverage as and when such policies expire or (ii) to obtain
comparable coverage from similar institutions as may be necessary or appropriate
to conduct its business as now conducted and at a cost that would not result in
a Material Adverse Change. None of the Company, the Guarantors or any of their
respective subsidiaries has been denied any insurance coverage that it has
sought or for which it has applied.
No Price Stabilization or Manipulation. Neither the Company
nor any Guarantors has taken, nor will take, directly or indirectly, any action
designed to or that might be reasonably expected to cause or result in
stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Securities.
Company's Accounting System. The Company and each Guarantor
maintain a system of accounting controls sufficient to provide reasonable
assurances that (i) transactions are executed in accordance with management's
general or specific authorization; (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with generally
accepted accounting principles as applied in the United States and to maintain
accountability for assets; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
Compliance with Environmental Laws. Except as otherwise
disclosed in the Offering Memorandum or as would not, individually or in the
aggregate, result in a Material Adverse Change (i) none of the Company, the
Guarantors or any of their respective subsidiaries is in violation of any
federal, state, local or foreign law or regulation relating to pollution or
9
protection of human health or the environment (including, without limitation,
ambient air, surface water, groundwater, land surface or subsurface strata) or
wildlife, including without limitation, laws and regulations relating to
emissions, discharges, releases or threatened releases of chemicals, pollutants,
contaminants, wastes, toxic substances, hazardous substances, petroleum and
petroleum products (collectively, "Materials of Environmental Concern"), or
otherwise relating to the manufacture, processing, distribution, use, treatment,
storage, disposal, transport or handling of Materials of Environmental Concern
(collectively, "Environmental Laws"), which violation includes, but is not
limited to, noncompliance with any permits or other governmental authorizations
required for the operation of the business of the Company, the Guarantors or
their respective subsidiaries under applicable Environmental Laws, or
noncompliance with the terms and conditions thereof, nor has the Company, the
Guarantors or any of their respective subsidiaries received any written
communication, whether from a governmental authority, citizens group, employee
or otherwise, that alleges that the Company, the Guarantors or any of their
respective subsidiaries is in violation of any Environmental Law; (ii) there is
no claim, action or cause of action filed with a court or governmental
authority, no investigation with respect to which the Company or any Guarantor
has received written notice, and no written notice by any person or entity
alleging potential liability for investigatory costs, cleanup costs,
governmental responses costs, natural resources damages, property damages,
personal injuries, attorneys' fees or penalties arising out of, based on or
resulting from the presence, or release into the environment, of any Material of
Environmental Concern at any location owned, leased or operated by the Company,
the Guarantors or any of their respective subsidiaries, now or in the past
(collectively, "Environmental Claims"), pending or, to the best of the Company's
or any Guarantor's knowledge, threatened against the Company, the Guarantors or
any of their respective subsidiaries or any person or entity whose liability for
any Environmental Claim the Company, the Guarantors or any of their respective
subsidiaries has retained or assumed either contractually or by operation of
law; and (iii) to the best of the knowledge of the executive officers and key
employees listed as such in the Offering Memorandum and of those other officers
and employees of the Company and the Guarantors with primary responsibility for
managing the environmental affairs of the Company and the Guarantors and their
respective facilities, there are no past or present actions, activities,
circumstances, conditions, events or incidents, including, without limitation,
the release, emission, discharge, presence or disposal of any Material of
Environmental Concern, that reasonably could result in a violation of any
Environmental Law or form the basis of a potential Environmental Claim against
the Company, the Guarantors or any of their respective subsidiaries or against
any person or entity whose liability for any Environmental Claim the Company,
the Guarantors or any of their respective subsidiaries has retained or assumed
either contractually or by operation of law.
Periodic Review of Costs of Environmental Compliance. To the
knowledge of the Company and the Guarantors, based upon their assessment of the
effect of Environmental Laws on the business, operations and properties of the
Company, the Guarantors and their respective subsidiaries, and taking into
account the amount of any established reserves, the Company and the Guarantors
have reasonably concluded that associated costs and liabilities (including,
without limitation, any capital or operating expenditures required for clean-up,
closure of properties or compliance with Environmental Laws or any permit,
license or approval, any related constraints on operating activities and any
potential liabilities to third parties) will not, individually or in the
aggregate, result in a Material Adverse Change.
ERISA Compliance. The Company, the Guarantors, their
respective subsidiaries and any "employee benefit plan" (as defined under the
Employee Retirement Income Security Act of 1974, as amended, and the regulations
and published interpretations thereunder (collectively, "ERISA")) established or
maintained by the Company, the Guarantors, their
10
respective subsidiaries or their "ERISA Affiliates" (as defined below) are in
compliance in all material respects with ERISA. "ERISA Affiliate" means, with
respect to the Company, any Guarantor or any of their respective subsidiaries,
any member of any group of organizations described in Sections 414(b), (c), (m)
or (o) of the Internal Revenue Code of 1986, as amended, and the regulations and
published interpretations thereunder (the "Code") of which the Company, such
Guarantor or such subsidiary is a member. No "reportable event" (as defined
under ERISA) has occurred or is reasonably expected to occur with respect to any
"employee benefit plan" established or maintained by the Company, the Guarantors
or their respective subsidiaries or any of their ERISA Affiliates, except as
would not, individually or in the aggregate, result in a Material Adverse
Change. No employee benefit plan" established or maintained by the Company, the
Guarantors, their respective subsidiaries or any of their ERISA Affiliates, if
such "employee benefit plan" were terminated, would have any "amount of unfunded
benefit liabilities" (as defined under ERISA), except as would not, individually
or in the aggregate, result in a Material Adverse Change. None of the Company,
the Guarantors, their respective subsidiaries or any of their ERISA Affiliates
have incurred or reasonably expect to incur any liability under Title IV of
ERISA with respect to termination of, or withdrawal from, any "employee benefit
plan" or Sections 412, 4971, 4975 or 4980B of the Code, except as would not,
individually or in the aggregate, result in a Material Adverse Change. Except as
would not, individually or in the aggregate, result in a Material Adverse
Change, each "employee benefit plan" established or maintained by the Company,
the Guarantors, their respective subsidiaries or any of their ERISA Affiliates
that is intended to be qualified under Section 401 of the Code is so qualified
and nothing has occurred, whether by action or failure to act, that would cause
the loss of such qualification.
No Default in Senior Indebtedness. No event of default exists
under any contract, indenture, mortgage, loan agreement, note, lease or other
agreement or instrument constituting Senior Debt (as defined in the Indenture).
Compliance with Regulation S. The Company, the Guarantors,
their respective Affiliates and all persons acting on their behalf (other than
the Initial Purchasers, as to whom the Company and the Guarantors make no
representation) have complied with and will comply with the offering
restrictions requirements of Regulation S in connection with the offering of the
Securities outside the United States, and, in connection therewith, the Offering
Memorandum will contain the disclosure required by Rule 902.
Reporting Issuer. Each of the Company and the Guarantors is
a "reporting issuer" as defined in Rule 902 under the Securities Act.
Other Representations and Warranties. All the representations
and warranties of the Company and the Guarantors set forth (1) in the
Acquisition Agreement are true and correct and, as of the Closing Date, will be
true and correct, and (2) in the Credit Agreement, as of the Closing Date, will
be true and correct.
Any certificate signed by an officer of the Company or any of
the Guarantors and delivered to the Initial Purchasers or to counsel for the
Initial Purchasers shall be deemed to be a representation and warranty by the
Company or such Guarantor to each Initial Purchaser as to the matters set forth
therein.
SECTION 2. PURCHASE, SALE AND DELIVERY OF THE SECURITIES.
The Securities. The Company agrees to issue and sell to the
several Initial Purchasers, severally and not jointly, all of the Securities
upon the terms herein set forth. On the
11
basis of the representations, warranties and agreements herein contained, and
upon the terms but subject to the conditions herein set forth, the Initial
Purchasers agree, severally and not jointly, to purchase from the Company the
aggregate principal amount of Securities set forth opposite their names on
Schedule A, at a purchase price of 95.686% of the principal amount thereof
payable on the Closing Date.
The Closing Date. Delivery of certificates for the Securities
in definitive form to be purchased by the Initial Purchasers and payment
therefor shall be made at the offices of Xxxxxx & Xxxxxxx, 000 Xxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx (or such other place as may be agreed to by the Company and the
Initial Purchasers) at 9:00 a.m. New York City time, on April 24, 2002, or such
other time and date as the Initial Purchasers shall designate by notice to the
Company (the time and date of such closing are called the "Closing Date"). The
Company hereby acknowledges that circumstances under which the Initial
Purchasers may provide notice to postpone the Closing Date as originally
scheduled include, but are in no way limited to, any determination by the
Company or the Initial Purchasers to recirculate to investors copies of an
amended or supplemented Offering Memorandum or a delay as contemplated by the
provisions of Section 16.
Delivery of the Securities. The Company shall deliver, or
cause to be delivered, to Banc of America Securities LLC for the accounts of the
several Initial Purchasers certificates for the Securities at the Closing Date
against the irrevocable release of a wire transfer of immediately available
funds for the amount of the purchase price therefor. The certificates for the
Securities shall be in such denominations and registered in the name of Cede &
Co., as nominee of the Depository, pursuant to the DTC Agreement, and shall be
made available for inspection on the business day preceding the Closing Date at
a location in New York City, as the Initial Purchasers may designate. Time shall
be of the essence, and delivery at the time and place specified in this
Agreement is a further condition to the obligations of the Initial Purchasers.
Delivery of Offering Memorandum to the Initial Purchasers. Not
later than 12:00 p.m. on the second business day following the date of this
Agreement, the Company shall deliver or cause to be delivered copies of the
Offering Memorandum in such quantities and at such places as the Initial
Purchasers shall reasonably request.
Initial Purchasers as Qualified Institutional Buyers. Each
Initial Purchaser severally and not jointly represents and warrants to, and
agrees with, the Company that it is a "qualified institutional buyer" within the
meaning of Rule 144A (a "Qualified Institutional Buyer") and an "accredited
investor" within the meaning of Rule 501 under the Securities Act (an
"Accredited Investor").
Additional Covenants. The Company and the Guarantors, jointly
and severally, further covenant and agree with each Initial Purchaser as
follows:
Initial Purchasers' Review of Proposed Amendments and
Supplements. Prior to amending or supplementing the Offering Memorandum, the
Company shall furnish to the Initial Purchasers for review a copy of each such
proposed amendment or supplement, and the Company shall not use any such
proposed amendment or supplement to which the Initial Purchasers reasonably
object.
Amendments and Supplements to the Offering Memorandum and
Other Securities Act Matters. If, prior to the completion of the placement of
the Securities by the Initial Purchasers with the Subsequent Purchasers, any
event shall occur or condition exist as a result of which it is necessary to
amend or supplement the Offering Memorandum in order to make the
12
statements therein, in the light of the circumstances when the Offering
Memorandum is delivered to a purchaser, not misleading, or if in the opinion of
the Initial Purchasers (or counsel for the Initial Purchasers) or the Company
(or counsel for the Company) it is otherwise necessary to amend or supplement
the Offering Memorandum to comply with law, the Company agrees to promptly
prepare (subject to Section 3 hereof) and furnish at its own expense to the
Initial Purchasers, amendments or supplements to the Offering Memorandum so that
the statements in the Offering Memorandum as so amended or supplemented will
not, in the light of the circumstances when the Offering Memorandum is delivered
to a purchaser, be misleading or so that the Offering Memorandum, as amended or
supplemented, will comply with law.
Following the consummation of the Exchange Offer or the
effectiveness of an applicable shelf registration statement and for so long as
the Securities are outstanding if, in the reasonable judgment of the Initial
Purchasers, the Initial Purchasers or any of their affiliates (as such term is
defined in the rules and regulations under the Securities Act) are required to
deliver a prospectus in connection with sales of, or market-making activities
with respect to, such securities, to periodically amend the applicable
registration statement so that the information contained therein complies with
the requirements of Section 10 of the Securities Act, to amend the applicable
registration statement or supplement the related prospectus or the documents
incorporated therein when necessary to reflect any material changes in the
information provided therein so that the registration statement and the
prospectus will not contain any untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements therein, in
the light of the circumstances existing as of the date the prospectus is so
delivered, not misleading and to provide the Initial Purchasers with copies of
each amendment or supplement filed and such other documents as the Initial
Purchasers may reasonably request.
The Company and the Guarantors hereby expressly acknowledge
that the indemnification and contribution provisions of Sections 8 and 9 hereof
are specifically applicable and relate to each offering memorandum, registration
statement, prospectus, amendment or supplement referred to in this Section 3.
Copies of the Offering Memorandum. The Company agrees to
furnish the Initial Purchasers, without charge, as many copies of the Offering
Memorandum and any amendments and supplements thereto as they shall have
reasonably requested.
Blue Sky Compliance. The Company shall cooperate with the
Initial Purchasers and counsel for the Initial Purchasers to qualify or register
the Securities for sale under (or obtain exemptions from the application of) the
Blue Sky or state securities laws of those jurisdictions designated by the
Initial Purchasers, shall comply with such laws and shall continue such
qualifications, registrations and exemptions in effect so long as required for
the distribution of the Securities. The Company shall not be required to qualify
as a foreign corporation or to take any action that would subject it to general
service of process in any such jurisdiction where it is not presently qualified
or where it would be subject to taxation as a foreign corporation. The Company
will advise the Initial Purchasers promptly of the suspension of the
qualification or registration of (or any such exemption relating to) the
Securities for offering, sale or trading in any jurisdiction or any initiation
or threat of any proceeding for any such purpose, and in the event of the
issuance of any order suspending such qualification, registration or exemption,
the Company shall use its reasonable best efforts to obtain the withdrawal
thereof at the earliest possible moment.
Use of Proceeds. The Company shall apply the net proceeds from
the sale of the Securities sold by it in the manner described under the caption
"Use of Proceeds" in the Offering Memorandum.
13
The Depositary. The Company shall cooperate with the Initial
Purchasers and use its best efforts to permit the Securities to be eligible for
clearance and settlement through the facilities of the Depositary.
Additional Issuer Information. Prior to the completion of the
placement of the Securities by the Initial Purchasers with the Subsequent
Purchasers, the Company shall file, on a timely basis, with the Commission and
the New York Stock Exchange all reports and documents required to be filed under
Section 13 or 15 of the Exchange Act. Additionally, at any time when the Company
is not subject to Section 13 or 15 of the Exchange Act, for the benefit of
holders and beneficial owners from time to time of Securities, the Company shall
furnish, at its expense, upon request, to holders and beneficial owners of
Securities and prospective purchasers of Securities information ("Additional
Issuer Information") satisfying the requirements of subsection of Rule 144A.
Agreement Not To Offer or Sell Additional Securities. During
the period of 180 days following the date of the Offering Memorandum, the
Company will not, without the prior written consent of Banc of America
Securities LLC (which consent may be withheld at the sole discretion of Banc of
America Securities LLC), directly or indirectly, sell, offer, contract or grant
any option to sell, pledge, transfer or establish an open "put equivalent
position" within the meaning of Rule 16a-1 under the Exchange Act, or otherwise
dispose of or transfer, or announce the offering of, or file any registration
statement under the Securities Act in respect of, any debt securities of the
Company or securities exchangeable for or convertible into debt securities of
the Company (other than as contemplated by this Agreement and to register the
Exchange Securities).
Future Reports to the Initial Purchasers. For so long as any
Securities or Exchange Securities remain outstanding, the Company and the
Guarantors shall furnish to Banc of America Securities LLC (i) as soon as
practicable after the end of each fiscal year, copies of the Annual Report of
the Company containing the balance sheet of the Company and its consolidated
subsidiaries as of the close of such fiscal year and statements of income,
stockholders' equity and cash flows for the year then ended and the opinion
thereon of the Company's and the Guarantors' independent public or certified
public accountants; (ii) as soon as practicable after the filing thereof, copies
of each proxy statement, Annual Report on Form 10-K, Quarterly Report on Form
10-Q, Current Report on Form 8-K or other report filed by the Company and the
Guarantors with the Commission, the NASD or any securities exchange; and (iii)
as soon as available, copies of any report or communication of the Company or
the Guarantors mailed generally to holders of its capital stock or debt
securities (including the holders of the Securities).
No Integration. The Company agrees that it will not and will
cause its Affiliates not to make any offer or sale of securities of the Company
of any class if, as a result of the doctrine of "integration" referred to in
Rule 502 under the Securities Act, such offer or sale would render invalid (for
the purpose of the sale of the Securities by the Company to the Initial
Purchasers, (i) the resale of the Securities by the Initial Purchasers to
Subsequent Purchasers or (ii) the resale of the Securities by such Subsequent
Purchasers to others) the exemption from the registration requirements of the
Securities Act provided by Section 4 thereof or by Rule 144A or by Regulation S
thereunder or otherwise.
Legended Securities. Each certificate for a Note will bear the
legend contained in "Notice to Investors" in the Offering Memorandum for the
time period and upon the other terms stated in the Offering Memorandum.
14
PORTAL. The Company shall use its best efforts to cause such
Notes to be eligible for the National Association of Securities Dealers, Inc.
PORTAL market (the "PORTAL market").
Acquisition. The Company shall use its reasonable best efforts
to consummate the Acquisition on or prior to the Special Mandatory Redemption
Date.
Contingent Payment Debt Instruments. The Company shall not
treat the Securities as contingent payment debt instruments (within the meaning
of United States Treasury Regulation Section 1.1275-4) for U.S. federal income
tax purposes unless required to do so pursuant to a final determination of the
Internal Revenue Service or a court of competent jurisdiction.
Banc of America Securities LLC, on behalf of the several
Initial Purchasers, may, in its sole discretion, waive in writing the
performance by the Company or any Guarantor of any one or more of the foregoing
covenants or extend the time for their performance.
Payment of Expenses. The Company agrees to pay all costs, fees
and expenses incurred in connection with the performance of its obligations
hereunder and in connection with the transactions contemplated hereby, including
without limitation (i) all expenses incident to the issuance and delivery of the
Securities (including all printing and engraving costs), (ii) all necessary
issue, transfer and other stamp taxes in connection with the issuance and sale
of the Securities to the Initial Purchasers, (iii) all fees and expenses of the
Company's and the Guarantors' counsel, independent public or certified public
accountants and other advisors, (iv) all costs and expenses incurred in
connection with the preparation, printing, filing, shipping and distribution of
each preliminary Offering Memorandum and the Offering Memorandum (including
financial statements and exhibits), and all amendments and supplements thereto,
this Agreement, the Registration Rights Agreement, the Indenture, the DTC
Agreement, the Notes and the Guarantees and the Escrow Agreement, (v) all filing
fees, attorneys' fees and expenses incurred by the Company, the Guarantors or
the Initial Purchasers in connection with qualifying or registering (or
obtaining exemptions from the qualification or registration of) all or any part
of the Securities for offer and sale under the Blue Sky laws and, if requested
by the Initial Purchasers, preparing and printing a "Blue Sky Survey" or
memorandum, and any supplements thereto, advising the Initial Purchasers of such
qualifications, registrations and exemptions, (vi) the fees and expenses of the
Trustee, including the fees and disbursements of counsel for the Trustee in
connection with the Indenture, the Securities and the Exchange Securities, (vii)
any fees payable in connection with the rating of the Securities or the Exchange
Securities with the ratings agencies and the listing of the Securities with the
PORTAL market, (viii) any filing fees incident to, and any reasonable fees and
disbursements of counsel to the Initial Purchasers in connection with, the
review by the National Association of Securities Dealers, Inc., if any, of the
terms of the sale of the Securities or the Exchange Securities, (ix) all fees
and expenses (including reasonable fees and expenses of counsel) of the Company
and the Guarantors in connection with approval of the Securities by DTC for
"book-entry" transfer, and the performance by the Company and the Guarantors of
their respective other obligations under this Agreement. Except as provided in
this Section 4, Section 6, Section 8 and Section 9 hereof, the Initial
Purchasers shall pay their own expenses, including the fees and disbursements of
their counsel.
Conditions of the Obligations of the Initial Purchasers. The
obligations of the several Initial Purchasers to purchase and pay for the
Securities as provided herein on the Closing Date shall be subject to the
accuracy of the representations and warranties on the part of the Company and
the Guarantors set forth in Section 1 hereof as of the date hereof and as of the
Closing Date as though then made and to the timely performance by the Company
and the
15
Guarantors of their respective covenants and other obligations hereunder, and to
each of the following additional conditions:
Accountants' Comfort Letter. On the date hereof, the Initial
Purchasers shall have received from each of Ernst & Young LLP, independent
public or certified public accountants for the Company, and Xxxxxx Xxxxxxxx LLP,
independent public or certified public accountants for Tilia International,
Inc., a letter dated the date hereof addressed to the Initial Purchasers, in
form and substance satisfactory to the Initial Purchasers, containing statements
and information of the type ordinarily included in accountant's "comfort
letters" to Initial Purchasers, delivered according to Statement of Auditing
Standards Nos. 72 and 76 (or any successor bulletins), with respect to the
audited and unaudited financial statements and certain financial information
contained in the Registration Statement and the Offering Memorandum.
No Material Adverse Change or Ratings Agency Change. For the
period from and after the date of this Agreement and prior to the Closing Date:
(i) in the reasonable judgment of the Initial Purchasers
there shall not have occurred any Material Adverse Change; and
(ii) there shall not have occurred any downgrading, nor shall
any notice have been given of any intended or potential downgrading or of any
review for a possible change that does not indicate the direction of the
possible change, in the rating accorded any securities of the Company, the
Guarantors or any of their respective subsidiaries by any "nationally recognized
statistical rating organization" as such term is defined for purposes of Rule
436 under the Securities Act.
Opinion of Counsel for the Company. On the Closing Date, the
Initial Purchasers shall have received the favorable opinion of Xxxxxxx Xxxx &
Xxxxxxxxx, counsel for the Company and the Guarantors, dated as of such Closing
Date, the form of which is attached as Exhibit A.
Opinion of Counsel for the Initial Purchasers. On the Closing
Date, the Initial Purchasers shall have received the favorable opinion of Xxxxxx
& Xxxxxxx, counsel for the Initial Purchasers, dated as of such Closing Date,
with respect to such matters as may be reasonably requested by the Initial
Purchasers.
Officers' Certificate. On the Closing Date, the Initial
Purchasers shall have received a written certificate executed by the Chairman of
the Board, Chief Executive Officer or President of the Company and the Chief
Financial Officer or Chief Accounting Officer of the Company and each Guarantor,
dated as of the Closing Date, to the effect set forth in subsection (b) of this
Section 5, and further to the effect that:
(iii) for the period from and after the date of this Agreement
and prior to the Closing Date there has not occurred any Material Adverse
Change;
(iv) the representations, warranties and covenants of the
Company and of such Guarantor set forth in Section 1 of this Agreement are true
and correct with the same force and effect as though expressly made on and as of
the Closing Date; and
(v) the Company and such Guarantor has complied with all the
agreements and satisfied all the conditions on its part to be performed or
satisfied at or prior to the Closing Date.
16
Bring-down Comfort Letter. On the Closing Date the Initial
Purchasers shall have received from each of Ernst & Young LLP, independent
public or certified public accountants for the Company, and Xxxxxx Xxxxxxxx LLP,
independent public or certified public accountants for Tilia International,
Inc., a letter dated such date, in form and substance satisfactory to the
Initial Purchasers, to the effect that they reaffirm the statements made in the
letter furnished by them pursuant to subsection of this Section 5, except that
the specified date referred to therein for the carrying out of procedures shall
be no more than three business days prior to the Closing Date.
PORTAL Listing. At the Closing Date the Notes shall have been
designated for trading on the PORTAL market.
Registration Rights Agreement. The Company and each Guarantor
shall have entered into the Registration Rights Agreement and the Initial
Purchasers shall have received executed counterparts thereof.
Indenture . The Company, the Guarantors and the Trustee shall
have entered into the Indenture and the Initial Purchasers shall have received
an executed copy thereof.
Acquisition Agreement. The Company shall have entered into the
Acquisition Agreement prior to or on the Closing Date and the Initial Purchasers
shall have received an executed copy thereof.
Credit Agreement. Either (i) the Company, the Guarantors and
the lenders party to the Credit Agreement shall have entered into the Credit
Agreement prior to or on the Closing Date or (ii) the Company and the Guarantors
shall have obtained consents from the lenders party to the Existing Senior
Credit Facility permitting the Company and the Guarantors to incur the debt
under the Securities, and, in either case, the Initial Purchasers shall have
received an executed copy thereof.
Additional Documents. On or before the Closing Date, the
Initial Purchasers and counsel for the Initial Purchasers shall have received
such information, documents and opinions as they may reasonably require for the
purposes of enabling them to pass upon the issuance and sale of the Securities
as contemplated herein, or in order to evidence the accuracy of any of the
representations and warranties, or the satisfaction of any of the conditions or
agreements, herein contained.
If any condition specified in this Section 5 is not satisfied
when and as required to be satisfied, this Agreement may be terminated by the
Initial Purchasers by notice to the Company at any time on or prior to the
Closing Date, which termination shall be without liability on the part of any
party to any other party, except that Section 4, Section 6, Section 8 and
Section 9 shall at all times be effective and shall survive such termination.
Reimbursement of Initial Purchasers' Expenses. If this
Agreement is terminated by the Initial Purchasers pursuant to Section 5, or if
the sale to the Initial Purchasers of the Securities on the Closing Date is not
consummated because of any refusal, inability or failure on the part of the
Company or the Guarantors to perform any agreement herein or to comply with any
provision hereof, each of the Company and the Guarantors agrees, jointly and
severally, to reimburse the Initial Purchasers (or such Initial Purchasers as
have terminated this Agreement with respect to themselves), severally, upon
demand for all out-of-pocket expenses that shall have been reasonably incurred
by the Initial Purchasers in connection with the proposed purchase and the
offering and sale of the Securities, including but not limited to reasonable
fees
17
and disbursements of counsel, printing expenses, travel expenses, postage,
facsimile and telephone charges.
Offer, Sale and Resale Procedures. Each of the Initial
Purchasers, on the one hand, and the Company and each of the Guarantors, on the
other hand, hereby establish and agree to observe the following procedures in
connection with the offer and sale of the Securities:
(a) Offers and sales of the Securities will be made only by the Initial
Purchasers or Affiliates thereof qualified to do so in the jurisdictions
in which such offers or sales are made. Each such offer or sale shall
only be made to persons whom the offeror or seller reasonably believes
to be qualified institutional buyers (as defined in Rule 144A under the
Securities Act) or non-U.S. persons outside the United States to whom
the offeror or seller reasonably believes offers and sales of the
Securities may be made in reliance upon Regulation S under the
Securities Act, upon the terms and conditions set forth in Annex I
hereto, which Annex I is hereby expressly made a part hereof.
(b) The Securities will be offered by approaching prospective Subsequent
Purchasers on an individual basis. No general solicitation or general
advertising (within the meaning of Rule 502 under the Securities Act)
will be used in the United States in connection with the offering of the
Securities.
(c) original issuance by the Company, and until such time as the same is
no longer required under the applicable requirements of the Securities
Act, the Securities (and all securities issued in exchange therefor or
in substitution thereof, other than the Exchange Securities) shall bear
the following legend:
"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER XXXXXXX 0 XX XXX XXXXXX XXXXXX SECURITIES ACT OF 1933
(THE "SECURITIES ACT"), AND THE SECURITY EVIDENCED HEREBY
MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THE SECURITY EVIDENCED HEREBY
IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE
EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES
ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE
SECURITY EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE
COMPANY THAT (A) SUCH SECURITY MAY BE RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED, ONLY (i)(a) TO A PERSON WHOM THE
SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN
A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (b) IN
A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE
SECURITIES ACT, (c) OUTSIDE THE UNITED STATES TO A FOREIGN
PERSON IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 903
OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT,
(d) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED
IN RULE 501(a)(1), (2), (3) or (7) OF THE SECURITIES ACT)
THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED
LETTER CONTAINING CERTAIN REPRESENTATIONS AND
18
AGREEMENTS (THE FORM OF WHICH CAN BE OBTAINED FROM THE
TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE
PRINCIPAL AMOUNT OF NOTES LESS THAN $250,000, AN OPINION OF
COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS IN
COMPLIANCE WITH THE SECURITIES ACT, OR (e) IN ACCORDANCE
WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL IF
THE COMPANY SO REQUESTS), (ii) TO THE COMPANY OR (iii)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH
CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF
ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE
JURISDICTION AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT
HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THE SECURITY
EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (A)
ABOVE. NO REPRESENTATION CAN BE MADE AS TO THE AVAILABILITY
OF THE EXEMPTION PROVIDED BY RULE 144 FOR RESALE OF THE
SECURITY EVIDENCED HEREBY."
Following the sale of the Securities by the Initial Purchasers to Subsequent
Purchasers pursuant to the terms hereof, the Initial Purchasers shall not be
liable or responsible to the Company for any losses, damages or liabilities
suffered or incurred by the Company, including any losses, damages or
liabilities under the Securities Act, arising from or relating to any resale or
transfer of any Security.
SECTION 3. INDEMNIFICATION.
Indemnification of the Initial Purchasers. The Company and the
Guarantors, jointly and severally, agree to indemnify and hold harmless each
Initial Purchaser, its directors, officers and employees, and each person, if
any, who controls any Initial Purchaser within the meaning of the Securities Act
and the Exchange Act against any loss, claim, damage, liability or expense, as
incurred, to which such Initial Purchaser or such controlling person may become
subject, under the Securities Act, the Exchange Act or other federal or state
statutory law or regulation, or at common law or otherwise (including in
settlement of any litigation, if such settlement is effected with the written
consent of the Company), insofar as such loss, claim, damage, liability or
expense (or actions in respect thereof as contemplated below) arises out of or
is based (i) upon any untrue statement or alleged untrue statement of a material
fact contained in the Preliminary Offering Memorandum or the Offering Memorandum
(or any amendment or supplement thereto), or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading; or
(ii) in whole or in part upon any inaccuracy in the representations and
warranties of the Company or any of the Guarantors contained herein; or (iii) in
whole or in part upon any failure of the Company or any of the Guarantors to
perform its obligations hereunder or under law; or (iv) any act or failure to
act or any alleged act or failure to act by any Initial Purchaser in connection
with, or relating in any manner to, the offering contemplated hereby, and which
is included as part of or referred to in any loss, claim, damage, liability or
action arising out of or based upon any matter covered by clause (i) above;
provided that the Company and the Guarantors shall not be liable under this
clause (iv) to the extent that a court of competent jurisdiction shall have
determined by a final judgment that such loss, claim, damage, liability or
action resulted directly from any such acts or failures to act undertaken or
omitted to be taken by such Initial Purchaser through its gross negligence or
willful misconduct; and to reimburse each Initial Purchaser and each such
controlling person for any and all expenses
19
(including the reasonable fees and disbursements of counsel chosen by Banc of
America Securities LLC) as such expenses are reasonably incurred by such Initial
Purchaser or such controlling person in connection with investigating,
defending, settling, compromising or paying any such loss, claim, damage,
liability, expense or action; provided, however, that the foregoing indemnity
agreement shall not apply to any loss, claim, damage, liability or expense to
the extent, but only to the extent, arising out of or based upon any untrue
statement or alleged untrue statement or omission or alleged omission made in
reliance upon and in conformity with written information furnished to the
Company by the Initial Purchasers expressly for use in any Preliminary Offering
Memorandum or the Offering Memorandum (or any amendment or supplement thereto).
The indemnity agreement set forth in this Section 8 shall be in addition to any
liabilities that the Company or any of the Guarantors may otherwise have.
Indemnification of the Company, the Guarantors, their
Directors and Officers. Each Initial Purchaser agrees, severally and not
jointly, to indemnify and hold harmless the Company, the Guarantors and each of
their respective directors and each person, if any, who controls the Company and
the Guarantors within the meaning of the Securities Act or the Exchange Act,
against any loss, claim, damage, liability or expense, as incurred, to which the
Company or any such director, or controlling person may become subject, under
the Securities Act, the Exchange Act, or other federal or state statutory law or
regulation, or at common law or otherwise (including in settlement of any
litigation, if such settlement is effected with the written consent of such
Initial Purchaser), insofar as such loss, claim, damage, liability or expense
(or actions in respect thereof as contemplated below) arises out of or is based
upon any untrue or alleged untrue statement of a material fact contained in any
Preliminary Offering Memorandum or the Offering Memorandum (or any amendment or
supplement thereto), or arises out of or is based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in any Preliminary Offering
Memorandum or the Offering Memorandum (or any amendment or supplement thereto),
in reliance upon and in conformity with written information furnished to the
Company by the Initial Purchasers expressly for use therein; and to reimburse
the Company, any such Guarantor, or any such director or controlling person for
any legal and other expenses reasonably incurred by the Company, any such
Guarantor, or any such director or controlling person in connection with
investigating, defending, settling, compromising or paying any such loss, claim,
damage, liability, expense or action. The Company and the Guarantors hereby
acknowledge that the only information that the Initial Purchasers have furnished
to the Company and the Guarantors expressly for use in any Preliminary Offering
Memorandum or the Offering Memorandum (or any amendment or supplement thereto)
are the statements set forth (i) in the fifth paragraph on page ii of the
Offering Memorandum concerning stabilization by the Initial Purchasers, (ii) in
the second sentence of the paragraph under the caption "Risk Factors--Risks
Relating to the Notes--You cannot be sure that an active trading market will
develop for these notes," and (iii) in the last sentence of the third paragraph,
in the second sentence of the fourth paragraph and in the fifth paragraph under
the caption "Plan of Distribution" in the Offering Memorandum; and the Initial
Purchasers confirm that such statements are correct. The indemnity agreement set
forth in this Section 8 shall be in addition to any liabilities that each
Initial Purchaser may otherwise have.
Notifications and Other Indemnification Procedures. Promptly
after receipt by an indemnified party under this Section 8 of notice of the
commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against an indemnifying party under this Section 8, notify
the indemnifying party in writing 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 for contribution or otherwise than under
the indemnity agreement
20
contained in this Section 8 or to the extent it is not prejudiced as a proximate
result of such failure. In case any such action is brought against any
indemnified party and such indemnified party seeks or intends to seek indemnity
from an indemnifying party, the indemnifying party will be entitled to
participate in and, to the extent that it shall elect, jointly with all other
indemnifying parties similarly notified, by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party; provided, however, if the defendants in
any such action include both the indemnified party and the indemnifying party
and the indemnified party shall have reasonably concluded that a conflict may
arise between the positions of the indemnifying party and the indemnified party
in conducting the defense of any such action or that there may be legal defenses
available to it and/or other indemnified parties which are different from or
additional to those available to the indemnifying party, the indemnified party
or parties shall have the right to select separate counsel to assume such legal
defenses and to otherwise participate in the defense of such action on behalf of
such indemnified party or parties. Upon receipt of notice from the indemnifying
party to such indemnified party of such indemnifying party's election so to
assume the defense of such action and approval by the indemnified party of
counsel, the indemnifying party will not be liable to such indemnified party
under this Section 8 for any legal or other expenses subsequently incurred by
such indemnified party in connection with the defense thereof unless the
indemnified party shall have employed separate counsel in accordance with the
proviso to the next preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate counsel (together with local counsel), approved by the indemnifying
party (Banc of America Securities LLC in the case of Section 8 and Section 9),
representing the indemnified parties who are parties to such action) or (ii) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of commencement of the action, in each of which cases the fees and
expenses of counsel shall be at the expense of the indemnifying party.
Settlements. The indemnifying party under this Section 8 shall
not be liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
against any loss, claim, damage, liability or expense by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by Section 8
hereof, the indemnifying party agrees that it shall be liable for any settlement
of any proceeding effected without its written consent if such settlement is
entered into more than 30 days after receipt by such indemnifying party of the
aforesaid request and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of such
settlement. No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement, compromise or consent to the entry
of judgment in any pending or threatened action, suit or proceeding in respect
of which any indemnified party is or could have been a party and indemnity was
or could have been sought hereunder by such indemnified party, unless such
settlement, compromise or consent includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter of
such action, suit or proceeding.
SECTION 4. CONTRIBUTION.
If the indemnification provided for in Section 8 is for any
reason held to be unavailable to or otherwise insufficient to hold harmless an
indemnified party in respect of any losses, claims, damages, liabilities or
expenses referred to therein, then each indemnifying party
21
shall contribute to the aggregate amount paid or payable by such indemnified
party, as incurred, as a result of any losses, claims, damages, liabilities or
expenses referred to therein (i) in such proportion as is appropriate to reflect
the relative benefits received by the Company or any of the Guarantors, on the
one hand, and the Initial Purchasers, on the other hand, from the offering of
the Securities pursuant to this Agreement or (ii) if the allocation provided by
clause above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause
above but also the relative fault of the Company or any of the Guarantors, on
the one hand, and the Initial Purchasers, on the other hand, in connection with
the statements or omissions or inaccuracies in the representations and
warranties herein that resulted in such losses, claims, damages, liabilities or
expenses, as well as any other relevant equitable considerations. The relative
benefits received by the Company or any of the Guarantors, on the one hand, and
the Initial Purchasers, on the other hand, in connection with the offering of
the Securities pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the
Securities pursuant to this Agreement (before deducting expenses) received by
the Company, and the total discount received by the Initial Purchasers bear to
the aggregate initial offering price of the Securities. The relative fault of
the Company or any of the Guarantors, on the one hand, and the Initial
Purchasers, on the other hand, shall be determined by reference to, among other
things, whether any such untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact or any such inaccurate
or alleged inaccurate representation or warranty relates to information supplied
by the Company or any of the Guarantors, on the one hand, or the Initial
Purchasers, on the other hand, and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.
The amount paid or payable by a party as a result of the
losses, claims, damages, liabilities and expenses referred to above shall be
deemed to include, subject to the limitations set forth in Section 8, any legal
or other fees or expenses reasonably incurred by such party in connection with
investigating or defending any action or claim. The provisions set forth in
Section 8 with respect to notice of commencement of any action shall apply if a
claim for contribution is to be made under this Section 9; provided, however,
that no additional notice shall be required with respect to any action for which
notice has been given under Section 8 for purposes of indemnification.
The Company, the Guarantors and the Initial Purchasers agree
that it would not be just and equitable if contribution pursuant to this Section
9 were determined by pro rata allocation (even if the Initial Purchasers were
treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to in this
Section 9.
Notwithstanding the provisions of this Section 9, no Initial
Purchaser shall be required to contribute any amount in excess of the discount
received by such Initial Purchaser in connection with the Securities distributed
by it. No person guilty of fraudulent misrepresentation (within the meaning of
Section 11 of the Securities Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. The Initial
Purchasers' obligations to contribute pursuant to this Section 9 are several,
and not joint, in proportion to their respective commitments as set forth
opposite their names in Schedule A. For purposes of this Section 9, each
director, officer and employee of an Initial Purchaser and each person, if any,
who controls an Initial Purchaser within the meaning of the Securities Act and
the Exchange Act shall have the same rights to contribution as such Initial
Purchaser, and each director of the Company and each director of the Guarantors,
and each person, if any, who controls the Company or a Guarantor with the
meaning of the Securities Act and the Exchange Act shall have the same rights to
contribution as the Company and such Guarantor.
22
Termination of this Agreement. Prior to the Closing Date, this
Agreement may be terminated by the Initial Purchasers by notice given to the
Company if at any time (i) trading or quotation in any of the Company's
securities shall have been suspended or limited by the Commission or by the New
York Stock Exchange, or trading in securities generally on either the Nasdaq
Stock Market or the New York Stock Exchange shall have been suspended or
limited, or minimum or maximum prices shall have been generally established on
any of such stock exchanges by the Commission or the NASD; (ii) a general
banking moratorium shall have been declared by any of federal, New York,
Delaware or California authorities; (iii) there shall have occurred any outbreak
or escalation of national or international hostilities or any crisis or
calamity, or any change in the United States or international financial markets,
or any substantial change or development involving a prospective substantial
change in United States' or international political, financial or economic
conditions, as in the judgment of the Initial Purchasers is material and adverse
and makes it impracticable to market the Securities in the manner and on the
terms described in the Offering Memorandum or to enforce contracts for the sale
of securities; (iv) in the judgment of the Initial Purchasers there shall have
occurred any Material Adverse Change; or (v) the Company, the Guarantors or
their respective subsidiaries shall have sustained a loss by strike, fire,
flood, earthquake, accident or other calamity of such character as in the
judgment of the Initial Purchasers may interfere materially with the conduct of
the business and operations of the Company, the Guarantors or their respective
subsidiaries regardless of whether or not such loss shall have been insured. Any
termination pursuant to this Section 10 shall be without liability on the part
of (x) the Company and the Guarantors to any Initial Purchaser, except that the
Company and the Guarantors shall be obligated to reimburse the expenses of the
Initial Purchasers pursuant to Sections 4 and 6 hereof, (y) any Initial
Purchaser to the Company, or (z) of any party hereto to any other party except
that the provisions of Section 8 and Section 9 shall at all times be effective
and shall survive such termination.
Representations and Indemnities to Survive Delivery. The
respective indemnities, agreements, representations, warranties and other
statements of the Company and the Guarantors, of their respective officers and
of the several Initial Purchasers set forth in or made pursuant to this
Agreement will remain in full force and effect, regardless of any investigation
made by or on behalf of any Initial Purchaser or the Company, the Guarantors or
any of its or their respective partners, officers or directors or any
controlling person, as the case may be, and will survive delivery of and payment
for the Securities sold hereunder and any termination of this Agreement.
Notices. All communications hereunder shall be in writing and
shall be mailed, hand delivered or telecopied and confirmed to the parties
hereto as follows:
23
If to the Initial Purchasers:
Banc of America Securities LLC
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Facsimile: 000-000-0000
Attention: High Yield Capital Markets
and
CIBC World Markets Corp.
000 Xxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: High Yield Capital Markets
with a copy to:
Xxxxxx & Xxxxxxx
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxx Xxxxxxxxxxx
If to the Company or the Guarantors:
Alltrista Corporation
Suite B-302
000 Xxxxxxxx Xxxxx Xxxxxx
Xxx, XX 00000
Facsimile: (000) 000-0000
Attention: Ian X.X. Xxxxxx
with a copy to:
Xxxxxxx Xxxx & Xxxxxxxxx
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxxx
Any party hereto may change the address for receipt of communications by giving
written notice to the others.
Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto, including any substitute Initial Purchasers
pursuant to Section 16 hereof, and to the benefit of the employees, officers and
directors and controlling persons referred to in
24
Section 8 and Section 9, and in each case their respective successors, and no
other person will have any right or obligation hereunder. The term "successors"
shall not include any purchaser of the Securities as such from any of the
Initial Purchasers merely by reason of such purchase.
Partial Unenforceability. The invalidity or unenforceability
of any Section, paragraph or provision of this Agreement shall not affect the
validity or enforceability of any other Section, paragraph or provision hereof.
If any Section, paragraph or provision of this Agreement is for any reason
determined to be invalid or unenforceable, there shall be deemed to be made such
minor changes (and only such minor changes) as are necessary to make it valid
and enforceable.
Governing Law Provisions. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE.
Consent to Jurisdiction. Any legal suit, action or proceeding
arising out of or based upon this Agreement or the transactions contemplated
hereby ("Related Proceedings") may be instituted in the federal courts of the
United States of America located in the City and County of New York or the
courts of the State of New York in each case located in the City and County of
New York (collectively, the "Specified Courts"), and each party irrevocably
submits to the non-exclusive jurisdiction (except for proceedings instituted in
regard to the enforcement of a judgment of any such court (a "Related
Judgment"), as to which such jurisdiction is non-exclusive) of such courts in
any such suit, action or proceeding. Service of any process, summons, notice or
document by mail to such party's address set forth above shall be effective
service of process for any suit, action or other proceeding brought in any such
court. The parties irrevocably and unconditionally waive any objection to the
laying of venue of any suit, action or other proceeding in the Specified Courts
and irrevocably and unconditionally waive and agree not to plead or claim in any
such court that any such suit, action or other proceeding brought in any such
court has been brought in an inconvenient forum.
Default of One or More of the Several Initial Purchasers. If
any one or more of the several Initial Purchasers shall fail or refuse to
purchase Securities that it or they have agreed to purchase hereunder on the
Closing Date, and the aggregate number of Securities which such defaulting
Initial Purchaser or Initial Purchasers agreed but failed or refused to purchase
does not exceed 10% of the aggregate number of the Securities to be purchased on
such date, the other Initial Purchasers shall be obligated, severally, in the
proportions that the number of Securities set forth opposite their respective
names on Schedule A bears to the aggregate number of Securities set forth
opposite the names of all such non-defaulting Initial Purchasers, or in such
other proportions as may be specified by the Initial Purchasers with the consent
of the non-defaulting Initial Purchasers, to purchase the Securities which such
defaulting Initial Purchaser or Initial Purchasers agreed but failed or refused
to purchase on such date. If any one or more of the Initial Purchasers shall
fail or refuse to purchase Securities and the aggregate number of Securities
with respect to which such default occurs exceeds 10% of the aggregate number of
Securities to be purchased on the Closing Date, and arrangements satisfactory to
the Initial Purchasers and the Company for the purchase of such Securities are
not made within 48 hours after such default, this Agreement shall terminate
without liability of any party to any other party except that the provisions of
Section 4, Section 6, Section 8 and Section 9 shall at all times be effective
and shall survive such termination. In any such case either the Initial
Purchasers or the Company shall have the right to postpone the Closing Date, as
the case may be, but in no event for longer than seven days in order that the
required changes, if any, to the Offering Memorandum or any other documents or
arrangements may be effected.
25
As used in this Agreement, the term "Initial Purchaser" shall
be deemed to include any person substituted for a defaulting Initial Purchaser
under this Section 10. Any action taken under this Section 16 shall not relieve
any defaulting Initial Purchaser from liability in respect of any default of
such Initial Purchaser under this Agreement.
General Provisions. This Agreement constitutes the entire
agreement of the parties to this Agreement and supersedes all prior written or
oral and all contemporaneous oral agreements, understandings and negotiations
with respect to the subject matter hereof. This Agreement may be executed in two
or more counterparts, each one of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
This Agreement may not be amended or modified unless in writing by all of the
parties hereto, and no condition herein (express or implied) may be waived
unless waived in writing by each party whom the condition is meant to benefit.
The Table of Contents and the section headings herein are for the convenience of
the parties only and shall not affect the construction or interpretation of this
Agreement.
If the foregoing is in accordance with your understanding of
our agreement, kindly sign and return to the Company the enclosed copies hereof,
whereupon this instrument, along with all counterparts hereof, shall become a
binding agreement in accordance with its terms.
26
Very truly yours,
ALLTRISTA CORPORATION
By: /s/ Ian X.X. Xxxxxx
----------------------------------
Name: Ian X.X. Xxxxxx
Title: Vice Chairman, Chief Financial
Officer and Secretary
ALLTRISTA NEWCO CORPORATION
By: /s/ Ian X.X. Xxxxxx
----------------------------------
Name: Ian X.X. Xxxxxx
Title: Treasurer and Secretary
QUOIN CORPORATION
By: /s/ Ian X.X. Xxxxxx
----------------------------------
Name: Ian X.X. Xxxxxx
Title: Treasurer
HEARTHMARK, INC.
By: /s/ Ian X.X. Xxxxxx
----------------------------------
Name: Ian X.X. Xxxxxx
Title: Treasurer and Secretary
ALLTRISTA PLASTICS CORPORATION
By: /s/ Ian X.X. Xxxxxx
----------------------------------
Name: Ian X.X. Xxxxxx
Title: Treasurer and Secretary
27
ALLTRISTA ZINC PRODUCTS, L.P.
By: Alltrista Newco Corporation,
its General Partner
By: /s/ Ian X.X. Xxxxxx
----------------------------------
Name: Ian X.X. Xxxxxx
Title: Treasurer and Secretary
ALLTRISTA ACQUISITION I, INC
By: /s/ Ian X.X. Xxxxxx
----------------------------------
Name: Ian X.X. Xxxxxx
Title: Treasurer and Secretary
ALLTRISTA ACQUISITION II, Inc
By: /s/ Ian X.X. Xxxxxx
----------------------------------
Name: Ian X.X. Xxxxxx
Title: Treasurer and Secretary
ALLTRISTA ACQUISITION III, Inc
By: /s/ Ian X.X. Xxxxxx
----------------------------------
Name: Ian X.X. Xxxxxx
Title: Treasurer and Secretary
PENN VIDEO, INC.
By: /s/ Ian X.X. Xxxxxx
----------------------------------
Name: Ian X.X. Xxxxxx
Title: Treasurer and Secretary
28
LAFAYETTE STEEL & ALUMINUM
CORPORATION
By: /s/ Ian X.X. Xxxxxx
----------------------------------
Name: Ian X.X. Xxxxxx
Title: Treasurer and Secretary
XXXXXXX TIN PLATE COMPANY
By: /s/ Ian X.X. Xxxxxx
----------------------------------
Name: Ian X.X. Xxxxxx
Title: Treasurer and Secretary
UNIMARK PLASTICS, INC.
By: /s/ Ian X.X. Xxxxxx
----------------------------------
Name: Ian X.X. Xxxxxx
Title: Treasurer and Secretary
LUMENX CORPORATION
By: /s/ Ian X.X. Xxxxxx
----------------------------------
Name: Ian X.X. Xxxxxx
Title: Treasurer and Secretary
ALLTRISTA UNIMARK, INC.
By: /s/ Ian X.X. Xxxxxx
----------------------------------
Name: Ian X.X. Xxxxxx
Title: Treasurer and Secretary
TRIENDA CORPORATION
By: /s/ Ian X.X. Xxxxxx
----------------------------------
Name: Ian X.X. Xxxxxx
Title: Treasurer and Secretary
29
The foregoing Purchase Agreement is hereby confirmed and
accepted by the Initial Purchasers as of the date first above written.
BANC OF AMERICA SECURITIES LLC
CIBC WORLD MARKETS CORP.
NATCITY INVESTMENTS, INC.
As representatives of the several
Initial Purchasers listed on Schedule A
By: Banc of America Securities LLC
By: /s/ Xxxxx Xxxxxxxx
-----------------------------
Name: Xxxxx Xxxxxxxx
Title: Managing Director
30
SCHEDULE A
Aggregate Principal
Amount of Securities
to be Purchased
Initial Purchasers
----------------------------------------------------- -----------------------
Banc of America Securities LLC ...................... $ 75,000,000
CIBC World Markets Corp.............................. $ 67,500,000
NatCity Investments, Inc. ........................... $ 7,500,000
Total....................................... $150,000,000
SCHEDULE B
Guarantors
Alltrista Newco Corporation
Quoin Corporation
Hearthmark, Inc.*
Alltrista Plastics Corporation**
Alltrista Zinc Products, L.P.***
Alltrista Acquisition I, Inc.
Alltrista Acquisition II, Inc.
Alltrista Acquisition III, Inc.
Penn Video, Inc.
Lafayette Steel & Aluminum Corporation
Xxxxxxx Tin Plate Company
Unimark Plastics, Inc.
LumenX Corporation
Alltrista Unimark, Inc.
TriEnda Corporation
* (DBA) Alltrista Consumer Products Company
** (DBA) Alltrista Unimark Plastics Company and Alltrista Industrial
Plastics Company
*** (DBA) Alltrista Zinc Products Company
