EXHIBIT 10.43
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NFO WORLDWIDE, INC.
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NOTE PURCHASE AGREEMENT
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Dated as of March 15, 1999
$7,000,000 7.52% Senior Notes Due November 15, 2008
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NFO WORLDWIDE, INC.
0 Xxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
7.52% Senior Notes Due November 15, 2008
Dated as of March 15, 1999
To the Purchaser Named on
the Signature Page Hereto
Ladies and Gentlemen:
NFO WORLDWIDE, INC., a Delaware corporation (together with its
successors and assigns, the "Company"), agrees with you as follows:
1. AUTHORIZATION OF NOTES.
The Company will authorize the issue and sale of $7,000,000 aggregate
principal amount of its 7.52% Senior Notes due November 15, 2008. Such notes
shall be substantially in the form set out in Exhibit 1 with such changes
therefrom, if any, as may be approved by you and the Company. The term "Notes",
as used herein, shall include each of such notes and any promissory notes
delivered pursuant to any provision of this Agreement or the Other Agreement (as
hereinafter defined) and any promissory notes delivered in substitution or
exchange for any Notes pursuant to any such provision, and the term "Note" shall
refer to any one of such Notes. Certain capitalized terms used in this Agreement
are defined in Schedule B; references to a "Schedule" or an "Exhibit" are,
unless otherwise specified, to a Schedule or an Exhibit attached to this
Agreement.
2. SALE AND PURCHASE OF NOTES.
Subject to the terms and conditions of this Agreement, the Company will
issue and sell to you and you will purchase from the Company, at the Closing
provided for in Section 3, Notes in the principal amount specified below your
name in Schedule A at the purchase price of 100% of the principal amount
thereof. Contemporaneously with entering into this Agreement, the Company is
entering into a separate Note Purchase Agreement (the "Other Agreement")
identical with this Agreement with the purchaser named in Schedule A (the "Other
Purchaser"), providing for the sale at the Closing to the Other Purchaser of
Notes in the principal amount specified below such Other Purchaser's name in
Schedule A. Your obligation hereunder and the obligations of the Other Purchaser
under the Other Agreement are several and not joint obligations, and you shall
have no obligation under the Other Agreement and no liability to any Person for
the performance or non-performance by the Other Purchaser thereunder.
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3. THE CLOSING.
The closing of the sale and purchase of the Notes (the "Closing") to be
purchased by you and the Other Purchaser shall occur at the offices of Xxxx &
Xxxxxx, P.C., Xxx Xxxxx Xxxxxx, Xxxxxxxx, Xxxxxxxxxxx at 10:00 a.m., local time,
on March 26, 1999 (the "Closing Date"). At the Closing, the Company will deliver
to you the Notes to be purchased by you in the form of a single Note (or such
greater number of Notes in denominations of at least $100,000 as you may
request), dated the Closing Date and registered in your name (or in the name of
your nominee), as indicated in Schedule A, against payment by federal funds wire
transfer in immediately available funds of the amount of the purchase price
therefor as directed by the Company in Schedule C. If at the Closing the Company
shall fail to tender such Notes to you as provided above in this Section 3, or
any of the conditions specified in Section 4 shall not have been fulfilled to
your satisfaction, you shall, at your election, be relieved of all further
obligations under this Agreement, without thereby waiving any rights you may
have by reason of such failure or such nonfulfillment.
4. CONDITIONS TO CLOSING.
Your obligation to purchase and pay for the Notes to be sold to you at
the Closing is subject to the fulfillment to your satisfaction, prior to or at
the Closing, of the following conditions:
4.1 Representations and Warranties.
The representations and warranties of the Company in this Agreement
shall be correct when made and at the time of the Closing.
4.2 Performance; No Default.
The Company shall have performed and complied with all agreements and
conditions contained in this Agreement required to be performed or complied with
by it prior to or at the Closing and after giving effect to the issue and sale
of the Notes (and the application of the proceeds thereof as contemplated by
Schedule 5.14) no Default or Event of Default shall have occurred and be
continuing. Neither the Company nor any Subsidiary shall have entered into any
transaction since the date of the Memorandum that would have been prohibited by
any of Sections 10.1, 10.2, 10.3, 10.5, 10.8, 10.9 or 10.11 had such Sections
applied since such date.
4.3 Compliance Certificates.
(a) Officer's Certificate. The Company shall have delivered to
you an Officer's Certificate, dated the Closing Date, certifying that
the conditions specified in Sections 4.1, 4.2 and 4.9 have been
fulfilled, and that the Junior Financing Condition (as defined in the
Existing Note Purchase Agreements) has been satisfied.
(b) Secretary's Certificate. The Company shall have delivered
to you a certificate of its Secretary or one of its Assistant
Secretaries, dated the Closing Date, certifying as to the resolutions
attached thereto and other corporate proceedings relating to the
authorization, execution and delivery of the Notes, this Agreement and
the Other Agreement.
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(c) Initial Guarantor Secretary's Certificates. Each of the
Initial Guarantors shall have delivered to you a certificate of its
Secretary or one of its Assistant Secretaries, dated the Closing Date,
certifying as to the resolutions attached thereto and other corporate
proceedings relating to the authorization, execution and delivery of
the Guaranty Agreement to which such Initial Guarantor is a party.
4.4 Opinions of Counsel.
You shall have received opinions in form and substance satisfactory to
you, each dated the Closing Date, from
(a) Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx, counsel for the
Company and the Initial Guarantors, substantially in the form set out
in Exhibit 4.4(a) and covering such other matters incident to the
transactions contemplated hereby as you or your counsel may reasonably
request (and the Company hereby instructs such counsel to deliver such
opinion to you), and
(b) Xxxx & Xxxxxx, your special counsel in connection with
such transactions, substantially in the form set out in Exhibit 4.4(b)
and covering such other matters incident to such transactions as you
may reasonably request.
4.5 Purchase Permitted By Applicable Law, etc.
On the Closing Date, your purchase of Notes shall (a) be permitted by
the laws and regulations of each jurisdiction to which you are subject, without
recourse to provisions (such as section 1405(a)(8) of the New York Insurance
Law) permitting limited investments by insurance companies without restriction
as to the character of the particular investment, (b) not violate any applicable
law or regulation (including, without limitation, Regulation T, U or X of the
Board of Governors of the Federal Reserve System) and (c) not subject you to any
tax, penalty or liability under or pursuant to any applicable law or regulation.
If requested by you, you shall have received an Officer's Certificate certifying
as to such matters of fact as you may reasonably specify to enable you to
determine whether such purchase is so permitted.
4.6 Sale of Other Notes.
Contemporaneously with the Closing the Company shall sell to the Other
Purchaser and the Other Purchaser shall purchase the Notes to be purchased by it
at the Closing as specified in Schedule A.
4.7 Payment of Special Counsel Fees.
Without limiting the provisions of Section 15.1, the Company shall have
paid on or before the Closing the fees, charges and disbursements of your
special counsel referred to in Section 4.4(b) to the extent reflected in a
statement of such counsel rendered to the Company at least one Business Day
prior to the Closing Date.
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4.8 Private Placement Number.
A Private Placement Number issued by Standard & Poor's CUSIP Service
Bureau (in cooperation with the Securities Valuation Office of the National
Association of Insurance Commissioners) shall have been obtained for the Notes.
4.9 Changes in Corporate Structure.
Except as specified in Schedule 4.9, the Company shall not have changed
its jurisdiction of incorporation or been a party to any merger or consolidation
and shall not have succeeded to all or any substantial part of the liabilities
of any other entity, at any time following the date of the most recent interim
financial statements referred to in Schedule 5.5.
4.10 Subordinated Notes.
Contemporaneously with the Closing the Company shall sell, and receive
payment (at par) for, Subordinated Funded Debt in an aggregate principal amount
of not less than $8,000,000, which Subordinated Funded Debt shall have
subordination and other provisions which are acceptable to you in all respects.
On or before the Closing Date the Note Purchase Agreement dated as of November
20, 1998 relating to $17,000,000 principal amounts of the Company's subordinated
notes shall have been amended and such amendment shall be satisfactory to you in
all respects.
4.11 Guaranty Agreements.
You shall have received a counterpart of each of the Guaranty
Agreements, duly executed and delivered by each of the Initial Guarantors,
substantially in the form of Exhibit 4.11, and such Guaranty Agreements shall be
in full force and effect.
4.12 Sharing Agreement.
You, the Other Purchaser, the holders of the Existing Notes and the
bank lenders under the Fleet/Chase Debt Facility shall have entered into an
Amended and Restated Sharing Agreement substantially in the form of Exhibit 4.12
(the "Sharing Agreement"), and such agreement shall be in full force and effect.
4.13 Amendments to Existing Agreements.
The Company shall have entered into amendments to each of the Existing
Note Purchase Agreements, the subordinated note purchase agreements dated as of
November 20, 1998, and the Fleet/Chase Debt Facility, and such amendments shall
be satisfactory to you in all respects.
4.14 Proceedings and Documents.
All corporate and other proceedings in connection with the transactions
contemplated by this Agreement and all documents and instruments incident to
such transactions shall be satisfactory to you
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and your special counsel, and you and your special counsel shall have received
all such counterpart originals or certified or other copies of such documents as
you or they may reasonably request.
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to you, as of the Closing Date,
that:
5.1 Organization; Power and Authority.
The Company is a corporation duly organized, validly existing and in
good standing under the laws of Delaware, and is duly qualified as a foreign
corporation and is in good standing in each jurisdiction in which such
qualification is required by law, other than those jurisdictions as to which the
failure to be so qualified or in good standing could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect. The Company
has the corporate power and authority to own or hold under lease the properties
it purports to own or hold under lease, to transact the business it transacts
and proposes to transact, to execute and deliver this Agreement and the Other
Agreement and the Notes and to perform the provisions hereof and thereof.
5.2 Authorization, etc.
This Agreement, the Other Agreement and the Notes have been duly
authorized by all necessary corporate action on the part of the Company, and
this Agreement constitutes, and upon execution and delivery thereof each Note
will constitute, a legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by (a) applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally and (b) general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
5.3 Disclosure.
The Company, through its agent, Xxxxxxx Xxxxx & Company, has delivered
to you and each Other Purchaser a copy of a Private Placement Memorandum, dated
February 10, 1999 (the "Memorandum"), relating to the transactions contemplated
hereby. The Memorandum fairly describes, in all material respects, the general
nature of the business and principal properties of the Company and its
Subsidiaries. Except as disclosed in Schedule 5.3, this Agreement, the
Memorandum, the documents, certificates or other writings delivered to you by or
on behalf of the Company in connection with the transactions contemplated hereby
and the financial statements listed in Schedule 5.5, taken as a whole, do not
contain any untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein not misleading in light of the
circumstances under which they were made. Except as disclosed in the Memorandum
or as expressly described in Schedule 5.3, or in one of the documents,
certificates or other writings identified therein, or in the financial
statements listed in Schedule 5.5, since December 31, 1997, there has been no
change in the financial condition, operations, business, properties or prospects
of the Company or any Subsidiary except changes that individually or in the
aggregate could not reasonably be expected to have a Material Adverse Effect.
There is no fact known to the Company that could reasonably be expected to have
a Material Adverse Effect that has not been set forth herein or in the
Memorandum or in the other documents, certificates and other writings delivered
to you by or on behalf of the Company specifically for use in connection with
the transactions contemplated hereby.
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5.4 Organization and Ownership of Shares of Subsidiaries; Affiliates.
(a) Schedule 5.4 contains (except as noted therein) complete and
correct lists of (i) the Company's Subsidiaries, showing, as to each
Subsidiary, the correct name thereof, the jurisdiction of its
organization, and the percentage of shares of each class of its
Capital Stock or similar equity interests outstanding owned by the
Company and each other Subsidiary and (ii) the Company's Affiliates,
other than Subsidiaries.
(b) All of the outstanding shares of Capital Stock or similar
equity interests of each Subsidiary shown in Schedule 5.4 as being
owned by the Company and its Subsidiaries have been validly issued,
are fully paid and nonassessable and are owned by the Company or
another Subsidiary free and clear of any Lien (except as otherwise
disclosed in Schedule 5.4).
(c) Each Subsidiary identified in Schedule 5.4 is a corporation
or other legal entity duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization, and is
duly qualified as a foreign corporation or other legal entity and is
in good standing in each jurisdiction in which such qualification is
required by law, other than those jurisdictions as to which the
failure to be so qualified or in good standing could not, individually
or in the aggregate, reasonably be expected to have a Material Adverse
Effect. Each such Subsidiary has the corporate or other power and
authority to own or hold under lease the properties it purports to own
or hold under lease and to transact the business it transacts and
proposes to transact.
(d) No Subsidiary is a party to, or otherwise subject to any
legal restriction or any agreement (other than this Agreement, the
agreements listed in Schedule 5.4 and customary limitations imposed by
corporate law statutes) restricting the ability of such Subsidiary to
pay dividends out of profits or make any other similar distributions
of profits to the Company or any of its Subsidiaries that owns
outstanding shares of Capital Stock or similar equity interests of
such Subsidiary, except for any such restrictions and agreements that
are applicable to Subsidiaries which, taken together, are not
Material.
(e) There are no Unrestricted Subsidiaries.
(f) No Subsidiary other than the Initial Guarantors is a
guarantor of the Fleet/Chase Debt Facility.
5.5 Financial Statements.
The Company has delivered to you and the Other Purchaser copies of the
financial statements of the Company and its Subsidiaries listed in Schedule 5.5.
All of said financial statements (including in each case the related schedules
and notes) fairly present in all material respects the consolidated financial
position of the Company and its Subsidiaries as of the respective dates
specified in such Schedule and the consolidated results of their operations and
cash flows for the respective periods so specified and have been prepared in
accordance with GAAP consistently applied throughout the periods involved except
as set forth in the notes thereto (subject, in the case of any interim financial
statements, to normal year-end adjustments).
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5.6 Compliance with Laws, Other Instruments, etc.
The execution, delivery and performance by the Company of this
Agreement and the Notes will not
(a) except for any contravention, breach or default that would
not have a Material Adverse Effect, contravene, result in any breach
of, or constitute a default under, or result in the creation of any
Lien in respect of any property of the Company or any Subsidiary under,
any indenture, mortgage, deed of trust, loan, purchase or credit
agreement, lease, corporate charter or by-laws, or any other agreement
or instrument to which the Company or any Subsidiary is bound or by
which the Company or any Subsidiary or any of their respective
properties may be bound or affected,
(b) conflict with or result in a breach of any of the terms,
conditions or provisions of any order, judgment, decree, or ruling of
any court, arbitrator or Governmental Authority applicable to the
Company or any Subsidiary, or
(c) violate any provision of any statute or other rule or
regulation of any Governmental Authority applicable to the Company or
any Subsidiary.
5.7 Governmental Authorizations, etc.
No consent, approval or authorization of, or registration, filing or
declaration with, any Governmental Authority is required in connection with the
execution, delivery or performance by the Company of this Agreement or the
Notes.
5.8 Litigation; Observance of Agreements, Statutes and Orders.
(a) There are no actions, suits or proceedings pending or, to
the knowledge of the Company, threatened against or affecting the
Company or any Subsidiary or any property of the Company or any
Subsidiary in any court or before any arbitrator of any kind or before
or by any Governmental Authority that, individually or in the
aggregate, could reasonably be expected to have a Material Adverse
Effect.
(b) Neither the Company nor any Subsidiary is in default under
any term of any agreement or instrument to which it is a party or by
which it is bound, or any order, judgment, decree or ruling of any
court, arbitrator or Governmental Authority or is in violation of any
applicable law, ordinance, rule or regulation (including, without
limitation, Environmental Laws) of any Governmental Authority, which
default or violation, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.
5.9 Taxes.
The Company and its Subsidiaries have filed all tax returns that are
required to have been filed in any jurisdiction, and have paid all taxes shown
to be due and payable on such returns and all other taxes and assessments levied
upon them or their properties, assets, income or franchises, to the extent such
taxes and assessments have become due and payable and before they have become
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delinquent, except for any taxes and assessments (a) the amount of which is not
individually or in the aggregate Material or (b) the amount, applicability or
validity of which is currently being contested in good faith by appropriate
proceedings and with respect to which the Company or a Subsidiary, as the case
may be, has established adequate reserves in accordance with GAAP. The Company
knows of no basis for any other tax or assessment that could reasonably be
expected to have a Material Adverse Effect. The charges, accruals and reserves
on the books of the Company and its Subsidiaries in respect of Federal, state or
other taxes for all fiscal periods are adequate. The Federal income tax
liabilities of the Company and its Subsidiaries have been determined by the
Internal Revenue Service and paid for all fiscal years up to and including the
fiscal year ended December 31, 1992.
5.10 Title to Property; Leases.
The Company and its Subsidiaries have good and sufficient title to
their respective properties that individually or in the aggregate are Material,
including all such properties reflected in the most recent audited balance sheet
referred to in Section 5.5 or purported to have been acquired by the Company or
any Subsidiary after said date (except as sold or otherwise disposed of in the
ordinary course of business), in each case free and clear of Liens prohibited by
this Agreement. All leases that individually or in the aggregate are Material
are valid and subsisting and are in full force and effect in all material
respects.
5.11 Licenses, Permits, etc.
Except as disclosed in Schedule 5.11,
(a) the Company and its Subsidiaries own or possess all
licenses, permits, franchises, authorizations, patents, copyrights,
service marks, trademarks and trade names, or rights thereto, that
individually or in the aggregate are Material, without known conflict
with the rights of others;
(b) to the best knowledge of the Company, no product or
practice of the Company or any Subsidiary infringes in any material
respect any license, permit, franchise, authorization, patent,
copyright, service xxxx, trademark, trade name or other right owned by
any other Person; and
(c) to the best knowledge of the Company, there is no Material
violation by any Person of any right of the Company or any of its
Subsidiaries with respect to any patent, copyright, service xxxx,
trademark, trade name or other right owned or used by the Company or
any of its Subsidiaries.
5.12 Compliance with ERISA.
(a) The Company and each ERISA Affiliate have operated and
administered each Plan in compliance with all applicable laws except
for such instances of noncompliance as have not resulted in and could
not reasonably be expected to result in a Material Adverse Effect.
Neither the Company nor any ERISA Affiliate has incurred any liability
pursuant to Title I or IV of ERISA or the penalty or excise tax
provisions of the Code relating to employee benefit plans (as defined
in section 3 of ERISA), and no event, transaction or condition has
occurred or exists that could reasonably be expected to result in the
incurrence
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of any such liability by the Company or any ERISA Affiliate, or in the
imposition of any Lien on any of the rights, properties or assets of
the Company or any ERISA Affiliate, in either case pursuant to Title I
or IV of ERISA or to such penalty or excise tax provisions or to
section 401(a)(29) or 412 of the Code, other than such liabilities or
Liens as would not be individually or in the aggregate Material.
(b) The present value of the aggregate benefit liabilities under
each of the Plans (other than Multiemployer Plans), determined as of
the end of such Plan's most recently ended plan year on the basis of
the actuarial assumptions specified for funding purposes in such
Plan's most recent actuarial valuation report, did not exceed the
aggregate current value of the assets of such Plan allocable to such
benefit liabilities by more than $1,500,000. The term "benefit
liabilities" has the meaning specified in section 4001 of ERISA and
the terms "current value" and "present value" have the meaning
specified in section 3 of ERISA.
(c) The Company and the ERISA Affiliates have not incurred
withdrawal liabilities (and are not subject to contingent withdrawal
liabilities) under section 4201 or 4204 of ERISA in respect of
Multiemployer Plans that individually or in the aggregate are
Material.
(d) The expected postretirement benefit obligation (determined as
of the last day of the Company's most recently ended fiscal year in
accordance with Financial Accounting Standards Board Statement No.
106, without regard to liabilities attributable to continuation
coverage mandated by section 4980B of the Code) of the Company and its
Subsidiaries is not Material.
(e) The execution and delivery of this Agreement and the issuance
and sale of the Notes hereunder will not involve any transaction that
is subject to the prohibitions of section 406 of ERISA or in
connection with which a tax could be imposed pursuant to section
4975(c)(1)(A)-(D) of the Code. The representation by the Company in
the first sentence of this Section 5.12(e) is made in reliance upon
and subject to the accuracy of your representation in Section 6.2 as
to the sources of the funds used to pay the purchase price of the
Notes to be purchased by you.
(f) Schedule 5.12 sets forth all ERISA Affiliates and all
"employee benefit plans" maintained by the Company (or any "affiliate"
thereof) or in respect of which the Notes could constitute an
"employer security" ("employee benefit plan" has the meaning specified
in section 3 of ERISA, "affiliate" has the meaning specified in
section 407(d) of ERISA and section V of the Department of Labor
Prohibited Transaction Exemption 95- 60 (60 FR 35925, July 12, 1995)
and "employer security" has the meaning specified in section 407(d) of
ERISA).
5.13 Private Offering by the Company.
Neither the Company nor anyone acting on its behalf has offered the
Notes or any similar securities for sale to, or solicited any offer to buy any
of the same from, or otherwise approached or negotiated in respect thereof with,
any Person other than you, the Other Purchaser and not more than 30 other
Institutional Investors, each of which has been offered the Notes at a private
sale for investment. Neither the Company nor anyone acting on its behalf has
taken, or will take, any action
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that would subject the issuance or sale of the Notes to the
registration requirements of section 5 of the Securities Act.
5.14 Use of Proceeds; Margin Regulations.
The Company will apply the proceeds of the sale of the Notes as set
forth in Schedule 5.14. No part of the proceeds from the sale of the Notes
hereunder will be used, directly or indirectly, for the purpose, whether
immediate, incidental or ultimate, of buying or carrying any margin stock within
the meaning of Regulation U of the Board of Governors of the Federal Reserve
System (12 CFR 221), or for the purpose of buying or carrying or trading in any
securities under such circumstances as to involve the Company in a violation of
Regulation X of said Board (12 CFR 224) or to involve any broker or dealer in a
violation of Regulation T of said Board (12 CFR 220). Margin stock does not
constitute more than 1% of the value of the consolidated assets of the Company
and its Subsidiaries and the Company does not have any present intention that
margin stock will constitute more than 1% of the value of such assets. As used
in this Section, the term "margin stock" shall have the meaning assigned to it
in said Regulation U.
5.15 Existing Debt; Future Liens.
(a) Except as described therein, Schedule 5.15 sets forth a
complete and correct list of each issue of outstanding Debt of the
Company and its Subsidiaries with an outstanding principal amount of at
least $1,000,000 as of the Closing Date (and specifying, as to each
such Debt, the collateral, if any, securing such Debt). The aggregate
amount of all Debt of the Company and its Subsidiaries not listed on
Schedule 5.15 is less than $2,000,000. Neither the Company nor any
Subsidiary is in default and no waiver of default is currently in
effect, in the payment of any principal of or interest on any Debt of
the Company or such Subsidiary and no event or condition exists with
respect to any Debt of the Company or any Subsidiary that would permit
(or that with notice or the lapse of time, or both, would permit) one
or more Persons to cause such Debt to become due and payable before its
stated maturity or before its regularly scheduled dates of payment.
(b) Except as disclosed in Schedule 5.15, neither the Company
nor any Subsidiary has agreed or consented to cause or permit in the
future (upon the happening of a contingency or otherwise) any of its
property, whether now owned or hereafter acquired, to be subject to a
Lien not permitted by Section 10.5.
5.16 Foreign Assets Control Regulations, etc.
Neither the sale of the Notes by the Company hereunder nor its use of
the proceeds thereof will violate the Trading with the Enemy Act, as amended, or
any of the foreign assets control regulations of the United States Treasury
Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling
legislation or executive order relating thereto.
5.17 Status under Certain Statutes.
Neither the Company nor any Subsidiary is subject to regulation under
the Investment Company Act of 1940, as amended, the Public Utility Holding
Company Act of 1935, as amended, the Transportation Acts (49 U.S.C.), as
amended, or the Federal Power Act, as amended.
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5.18 Environmental Matters.
Neither the Company nor any Subsidiary has knowledge of any claim or
has received any notice of any claim, and no proceeding has been instituted
raising any claim against the Company or any of its Subsidiaries or any of their
respective real properties now or formerly owned, leased or operated by any of
them or other assets, alleging any damage to the environment or violation of any
Environmental Laws, except, in each case, such as could not reasonably be
expected to result in a Material Adverse Effect. Except as otherwise disclosed
to you in writing,
(a) neither the Company nor any Subsidiary has knowledge of any
facts which would give rise to any claim, public or private, of
violation of Environmental Laws or damage to the environment emanating
from, occurring on or in any way related to real properties now or
formerly owned, leased or operated by any of them or to other assets
or their use, except, in each case, such as could not reasonably be
expected to result in a Material Adverse Effect;
(b) neither the Company nor any of its Subsidiaries has stored
any Hazardous Materials on real properties now or formerly owned,
leased or operated by any of them and has not disposed of any
Hazardous Materials in a manner contrary to any Environmental Laws in
each case in any manner that could reasonably be expected to result in
a Material Adverse Effect; and
(c) all buildings on all real properties now owned, leased or
operated by the Company or any of its Subsidiaries are in compliance
with applicable Environmental Laws, except where failure to comply
could not reasonably be expected to result in a Material Adverse
Effect.
5.19 Year 2000 Matters.
The Company has reasonable grounds for believing that it will be Year
2000 Compliant and Ready on or before December 1, 1999. "Year 2000 Compliant and
Ready" means that
(a) the Company's and its Subsidiaries' hardware and software
systems, with respect to the operation of their business, will (i)
handle satisfactorily date information involving any and all dates
before, during and/or after January 1, 2000, including accepting
input, providing output and performing date calculations in whole or
in part and (ii) operate accurately, without Material interruption, on
and in respect of any and all dates before, during and/or after
January 1, 2000 and without any Material change in performance; and
(b) the Company has developed alternative plans to ensure
business continuity in all Material respects in the event of the
failure of the items identified in clauses (i) and (ii) in the
foregoing clause (a).
6. REPRESENTATIONS OF THE PURCHASER.
6.1 Purchase for Investment.
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You represent that you are purchasing the Notes for your own account or
for one or more separate accounts maintained by you or for the account of one or
more pension or trust funds and not with a view to the distribution thereof,
provided that the disposition of your or their property shall at all times be
within your or their control. You understand that the Notes have not been
registered under the Securities Act and may be resold only if registered
pursuant to the provisions of the Securities Act or if an exemption from
registration is available, except under circumstances where neither such
registration nor such an exemption is required by law, and that the Company is
not required to register the Notes.
6.2 Source of Funds.
You represent that at least one of the following statements is an
accurate representation as to each source of funds (a "Source") to be used by
you to pay the purchase price of the Notes to be purchased by you hereunder:
(a) the Source is an "insurance company general account" as
defined in United States Department of Labor Prohibited Transaction
Exemption ("PTE") 95-60 (60 FR 35925, July 12, 1995) and in respect
thereof you represent that there is no "employee benefit plan" (as
defined in section 3(3) of ERISA and section 4975(e)(1) of the Code,
treating as a single plan all plans maintained by the same employer or
employee organization or affiliate thereof) with respect to which the
amount of the general account reserves and liabilities of all contracts
held by or on behalf of such plan exceeds 10% of the total reserves and
liabilities of such general account (exclusive of separate account
liabilities) plus surplus, as set forth in the National Association of
Insurance Commissioners' Annual Statement filed with your state of
domicile and that such acquisition is eligible for and satisfies the
other requirements of such exemption; or
(b) if you are an insurance company, the Source does not
include assets allocated to any separate account maintained by you in
which any employee benefit plan (or its related trust) has any
interest, other than a separate account that is maintained solely in
connection with your fixed contractual obligations under which the
amounts payable, or credited, to such plan and to any participant or
beneficiary of such plan (including any annuitant) are not affected in
any manner by the investment performance of the separate account; or
(c) the Source is either (i) an insurance company pooled
separate account, within the meaning of PTE 90-1 (issued January 29,
1990), or (ii) a bank collective investment fund, within the meaning of
the PTE 91-38 (issued July 12, 1991) and, except as you have disclosed
to the Company in writing pursuant to this paragraph (c), no employee
benefit plan or group of plans maintained by the same employer or
employee organization beneficially owns more than 10% of all assets
allocated to such pooled separate account or collective investment
fund; or
(d) the Source constitutes assets of an "investment fund"
(within the meaning of part V of PTE 84-14 (the "QPAM Exemption"))
managed by a "qualified professional asset manager" or "QPAM" (within
the meaning of part V of the QPAM Exemption), no employee benefit
plan's assets that are included in such investment fund, when combined
with the assets of all other employee benefit plans established or
maintained by the same employer or by an affiliate (within the meaning
of section V(c)(1) of the QPAM Exemption) of such employer or
51
by the same employee organization and managed by such QPAM, exceed 20%
of the total client assets managed by such QPAM, the conditions of
part I(c) and (g) of the QPAM Exemption are satisfied, neither the
QPAM nor a person controlling or controlled by the QPAM (applying the
definition of "control" in section V(e) of the QPAM Exemption) owns a
5% or more interest in the Company and
(i) the identity of such QPAM and
(ii) the names of all employee benefit plans whose assets are
included in such investment fund have been disclosed to the Company in
writing pursuant to this paragraph (d); or
(e) the Source is a governmental plan; or
(f) the Source is one or more employee benefit plans, or a separate account
or trust fund comprised of one or more employee benefit plans, each of which has
been identified to the Company in writing pursuant to this paragraph (f); or
(g) the Source does not include assets of any employee benefit plan
described in section 4975(e) of the Code, other than a plan exempt from the
coverage of ERISA and the provisions of section 4975 of the Code.
As used in this Section 6.2, the terms "employee benefit plan", "governmental
plan" and "separate account" shall have the respective meanings assigned to such
terms in Section 3 of ERISA.
7. INFORMATION AS TO COMPANY.
7.1 Financial and Business Information.
The Company shall deliver to each holder of Notes that is an
Institutional Investor:
(a) Quarterly Statements -- within 60 days after the end of each
quarterly fiscal period in each fiscal year of the Company (other than the
last quarterly fiscal period of each such fiscal year), duplicate copies
of,
(i) consolidated balance sheets of the Company and its
Subsidiaries, and of the Company and the Restricted Subsidiaries, as
at the end of such quarter, and
(ii) consolidated statements of income, shareholders' equity and
cash flows of the Company and its Subsidiaries, and of the Company and
the Restricted Subsidiaries, for such quarter and (in the case of the
second and third quarters) for the portion of the fiscal year ending
with such quarter,
setting forth in each case in comparative form the figures for the
corresponding periods in the previous fiscal year, all in reasonable
detail, prepared in accordance with GAAP applicable to quarterly
financial statements generally, and certified by a Senior Financial
Officer as fairly presenting, in all material respects, the
consolidated financial position of the companies being reported on and
their consolidated results of operations and cash flows, subject to
changes
52
resulting from year-end adjustments, provided that, so long as no
Unrestricted Subsidiaries existed at any time during the periods
covered by such financial statements, delivery within the time period
specified above of copies of the Company's Quarterly Report on Form
10-Q prepared in compliance with the requirements therefor and filed
with the Securities and Exchange Commission shall be deemed to satisfy
the requirements of this Section 7.1(a);
(b) Annual Statements -- within 120 days after the end of each
fiscal year of the Company, duplicate copies of,
(i) consolidated balance sheets of the Company and its
Subsidiaries, and of the Company and the Restricted Subsidiaries,
as at the end of such year, and
(ii) consolidated statements of income, shareholders' equity
and cash flows of the Company and its Subsidiaries, and of the
Company and the Restricted Subsidiaries, for such year,
setting forth in each case in comparative form the figures for the
previous fiscal year, all in reasonable detail, prepared in accordance
with GAAP, and accompanied by
(A) an opinion thereon of independent
certified public accountants of recognized national
standing, which opinion shall state that such
financial statements present fairly, in all material
respects, the consolidated financial position of the
companies being reported upon and their consolidated
results of operations and cash flows and have been
prepared in conformity with GAAP, and that the
examination of such accountants in connection with
such financial statements has been made in accordance
with generally accepted auditing standards, and that
such audit provides a reasonable basis for such
opinion in the circumstances, and
(B) a certificate of such accountants
stating that they have reviewed this Agreement and
stating further whether, in making their audit, they
have become aware of any condition or event that then
constitutes a Default or an Event of Default, and, if
they are aware that any such condition or event then
exists, specifying the nature and period of the
existence thereof (it being understood that such
accountants shall not be liable, directly or
indirectly, for any failure to obtain knowledge of
any Default or Event of Default unless such
accountants should have obtained knowledge thereof in
making an audit in accordance with generally accepted
auditing standards or did not make such an audit),
provided that, so long as no Unrestricted Subsidiaries existed at any
time during the periods covered by such financial statements, the
delivery within the time period specified above of the Company's Annual
Report on Form 10-K for such fiscal year prepared in accordance with
the requirements therefor and filed with the Securities and Exchange
Commission, together with the accountant's certificate described in
clause (B) above, shall be deemed to satisfy the requirements of this
Section 7.1(b);
53
(c) SEC and Other Reports -- promptly upon their becoming available,
one copy of (i) each financial statement, report (including, without
limitation, the Company's annual report to shareholders, if any, prepared
pursuant to Rule 14a-3 under the Exchange Act), notice or proxy statement
sent by the Company or any Subsidiary to public securities holders
generally, and (ii) each regular or periodic report, each registration
statement (without exhibits except as expressly requested by such holder),
and each prospectus and all amendments thereto filed by the Company or any
Subsidiary with the Securities and Exchange Commission and of all press
releases and other statements made available generally by the Company or
any Subsidiary to the public concerning developments that are Material;
(d) Notice of Default or Event of Default -- promptly, and in any
event within five days after a Responsible Officer becoming aware of the
existence of any Default or Event of Default or that any Person has given
any notice or taken any action with respect to a claimed default hereunder
or that any Person has given any notice or taken any action with respect to
a claimed default of the type referred to in Section 11(f), a written
notice specifying the nature and period of existence thereof and what
action the Company is taking or proposes to take with respect thereto;
(e) ERISA Matters -- promptly, and in any event within five days after
a Responsible Officer becoming aware of any of the following, a written
notice setting forth the nature thereof and the action, if any, that the
Company or an ERISA Affiliate proposes to take with respect thereto:
(i) with respect to any Plan, any reportable event, as defined in
section 4043(c) of ERISA and the regulations thereunder, for which
notice thereof has not been waived pursuant to such regulations as in
effect on the Closing Date; or
(ii) the taking by the PBGC of steps to institute, or the
threatening by the PBGC of the institution of, proceedings under
section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Plan, or the receipt by the Company or any
ERISA Affiliate of a notice from a Multiemployer Plan that such action
has been taken by the PBGC with respect to such Multiemployer Plan; or
(iii) any event, transaction or condition that could result in
the incurrence of any liability by the Company or any ERISA Affiliate
pursuant to Title I or IV of ERISA or the penalty or excise tax
provisions of the Code relating to employee benefit plans, or in the
imposition of any Lien on any of the rights, properties or assets of
the Company or any ERISA Affiliate pursuant to Title I or IV of ERISA
or such penalty or excise tax provisions, if such liability or Lien,
taken together with any other such liabilities or Liens then existing,
could reasonably be expected to have a Material Adverse Effect;
(f) Notices from Governmental Authority -- promptly, and in any event
within 30 days of receipt thereof, copies of any notice to the Company or
any Subsidiary from any Federal or state Governmental Authority relating to
any order, ruling, statute or other law or regulation that could reasonably
be expected to have a Material Adverse Effect;
54
(g) Actions, Proceedings -- promptly after a Responsible Officer
becomes aware of the commencement thereof, notice of any action or
proceeding relating to the Company or any Subsidiary in any court or
before any Governmental Authority or arbitration board or tribunal as
to which there is a reasonable possibility of an adverse determination
and that, if adversely determined, could reasonably be expected to
have a Material Adverse Effect; and
(h) Requested Information -- with reasonable promptness, such
other data and information relating to the business, operations,
affairs, financial condition, assets or properties of the Company or
any of its Subsidiaries (including, without limitation, information
regarding the impact of the occurrence of the year 2000 on the Company
and its Subsidiaries and plans of the Company to address any such
impact) or relating to the ability of the Company to perform its
obligations hereunder and under the Notes as from time to time may be
reasonably requested by any such holder of Notes, or such information
regarding the Company required to satisfy the requirements of 17
C.F.R. ss.230.144A, as amended from time to time, in connection with
any contemplated transfer of the Notes.
7.2 Officer's Certificate.
Each set of financial statements delivered to a holder of Notes
pursuant to Section 7.1(a) or Section 7.1(b) hereof shall be accompanied by a
certificate of a Senior Financial Officer setting forth:
(a) Covenant Compliance -- the information (including detailed
calculations) required in order to establish whether the Company was
in compliance with the requirements of Sections 10.1 through 10.12,
inclusive, and Sections 10.14 through Section 10.16, inclusive, during
the quarterly or annual period covered by the statements then being
furnished (including with respect to each such Section, where
applicable, the calculations of the maximum or minimum amount, ratio
or percentage, as the case may be, permissible under the terms of such
Sections, and the calculation of the amount, ratio or percentage then
in existence); and
(b) Event of Default -- a statement that such officer has
reviewed the relevant terms hereof and has made, or caused to be made,
under his or her supervision, a review of the transactions and
conditions of the Company and its Subsidiaries from the beginning of
the quarterly or annual period covered by the statements then being
furnished to the date of the certificate and that such review has not
disclosed the existence during such period of any condition or event
that constitutes a Default or an Event of Default or, if any such
condition or event existed or exists (including, without limitation,
any such event or condition resulting from the failure of the Company
or any Subsidiary to comply with any Environmental Law), specifying
the nature and period of existence thereof and what action the Company
shall have taken or proposes to take with respect thereto.
7.3 Inspection.
The Company shall permit the representatives of each holder of Notes
that is an Institutional Investor:
55
(a) No Default -- if no Default or Event of Default then
exists, at the expense of such holder and upon reasonable prior notice
to the Company, to visit the principal executive office of the Company,
to discuss the affairs, finances and accounts of the Company and its
Subsidiaries with the Company's officers, and (with the consent of the
Company, which consent will not be unreasonably withheld) its
independent public accountants, and (with the consent of the Company,
which consent will not be unreasonably withheld) to visit the other
offices and properties of the Company and each Subsidiary, all at such
reasonable times and as often as may be reasonably requested in
writing; and
(b) Default -- if a Default or Event of Default then exists,
at the expense of the Company, to visit and inspect any of the offices
or properties of the Company or any Subsidiary, to examine all their
respective books of account, records, reports and other papers, to make
copies and extracts therefrom, and to discuss their respective affairs,
finances and accounts with their respective officers and independent
public accountants (and by this provision the Company authorizes said
accountants to discuss the affairs, finances and accounts of the
Company and its Subsidiaries), all at such times and as often as may be
requested.
8. PAYMENT OF THE NOTES.
8.1 Required Prepayments; Payment at Maturity.
The Company will prepay $1,000,000 principal amount of the Notes on
November 15, 2002, and on each November 15 thereafter to and including November
15, 2007, or, in each case, such lesser principal amount as shall be outstanding
on each such November 15, all such prepayments to be made at par and without
payment of any Make-Whole Amount. The Company will pay all of the principal
amount of the Notes remaining outstanding, if any, on November 15, 2008. Each
partial prepayment of the Notes pursuant to Section 8.2 will be applied first,
to the amount due on the maturity date of the Notes and second, to the mandatory
prepayments applicable to the Notes, as set forth in this Section 8.1, in the
inverse order of the maturity thereof.
8.2 Optional Prepayments with Make-Whole Amount.
The Company may, at its option, upon notice as provided below, prepay
at any time all, or from time to time any part of, the Notes (but if in part, in
an amount not less than $1,000,000 or such lesser amount as shall then be
outstanding), at 100% of the principal amount so prepaid, plus accrued interest
on, and the Make-Whole Amount determined for the prepayment date with respect
to, such principal amount. The Company will give each holder of Notes written
notice of each optional prepayment under this Section 8.2 not less than 30 days
and not more than 60 days prior to the date fixed for such prepayment. Each such
notice shall specify such prepayment date, the aggregate principal amount of the
Notes to be prepaid on such date, the principal amount of each Note held by such
holder to be prepaid (determined in accordance with Section 8.3), and the
interest to be paid on the prepayment date with respect to such principal amount
being prepaid, and shall be accompanied by a certificate of a Senior Financial
Officer as to the estimated Make- Whole Amount due in connection with such
prepayment (calculated as if the date of such notice were the date of the
prepayment), setting forth the details of such computation. Two Business Days
prior to such prepayment, the Company shall deliver to each holder of Notes a
certificate of a Senior Financial Officer specifying the calculation of such
Make-Whole Amount as of the specified prepayment date.
56
8.3 Allocation of Partial Prepayments.
In the case of each partial prepayment of the Notes, the principal
amount of the Notes to be prepaid shall be allocated among all of the Notes at
the time outstanding in proportion, as nearly as practicable, to the respective
unpaid principal amounts thereof not theretofore called for prepayment.
8.4 Maturity; Surrender, etc.
In the case of each prepayment of Notes pursuant to this Section 8, the
principal amount of each Note to be prepaid shall mature and become due and
payable on the date fixed for such prepayment, together with interest on such
principal amount accrued to such date and the applicable Make-Whole Amount, if
any. From and after such date, unless the Company shall fail to pay such
principal amount when so due and payable, together with the interest and Make-
Whole Amount, if any, as aforesaid, interest on such principal amount shall
cease to accrue. Any Note paid or prepaid in full shall be surrendered to the
Company and canceled and shall not be reissued, and no Note shall be issued in
lieu of any prepaid principal amount of any Note.
8.5 No Other Optional Prepayments or Purchase of Notes.
The Company will not prepay (whether directly or indirectly by
purchase, redemption or other acquisition) any of the outstanding Notes except
(a) upon the payment or prepayment of the Notes in accordance with the terms of
this Section 8 or upon an acceleration of the maturity of the Notes pursuant to
Section 12 or (b) pursuant to an offer to purchase made by the Company pro rata
to the holders of all Notes at the time outstanding upon the same terms and
conditions. Any such offer (i) need not comply with the other provisions of this
Section 8 (including, without limitation, the requirement to pay any Make-Whole
Amount), (ii) shall provide each holder with sufficient information to enable it
to make an informed decision with respect to such offer, and (iii) shall remain
open for at least 10 Business Days. The Company will promptly cancel all Notes
acquired by it or any Affiliate pursuant to any payment, prepayment or purchase
of Notes pursuant to any provision of this Section 8 and no Notes may be issued
in substitution or exchange for any such Notes.
8.6 Make-Whole Amount.
The term "Make-Whole Amount" means, with respect to any Note, an amount
equal to the excess, if any, of the Discounted Value of the Remaining Scheduled
Payments with respect to the Called Principal of such Note over the amount of
such Called Principal, provided that the Make- Whole Amount may in no event be
less than zero. For the purposes of determining the Make- Whole Amount, the
following terms have the following meanings:
"Called Principal" means, with respect to any Note, the
principal of such Note that is to be prepaid pursuant to Section 8.2 or
has become or is declared to be immediately due and payable pursuant to
Section 12.1, as the context requires.
57
"Discounted Value" means, with respect to the Called Principal
of any Note, the amount obtained by discounting all Remaining Scheduled
Payments with respect to such Called Principal from their respective
scheduled due dates to the Settlement Date with respect to such Called
Principal, in accordance with accepted financial practice and at a
discount factor (applied on the same periodic basis as that on which
interest on the Notes is payable) equal to the Reinvestment Yield with
respect to such Called Principal.
"Reinvestment Yield" means, with respect to the Called
Principal of any Note, 0.50% over the yield to maturity implied by (a)
the yields reported, as of 10:00 A.M. (New York City time) on the
second Business Day preceding the Settlement Date with respect to such
Called Principal, on the display designated as "Page UST" on the
Bloomberg Financial Market Service (or such other display as may
replace Page UST on the Bloomberg Financial Market Service) for
actively traded U.S. Treasury securities having a maturity equal to the
Remaining Average Life of such Called Principal as of such Settlement
Date, or (b) if such yields are not reported as of such time or the
yields reported as of such time are not ascertainable, the Treasury
Constant Maturity Series Yields reported, for the latest day for which
such yields have been so reported as of the second Business Day
preceding the Settlement Date with respect to such Called Principal, in
Federal Reserve Statistical Release H.15 (519) (or any comparable
successor publication) for actively traded U.S. Treasury securities
having a constant maturity equal to the Remaining Average Life of such
Called Principal as of such Settlement Date. Such implied yield will be
determined, if necessary, by (i) converting U.S. Treasury xxxx
quotations to bond-equivalent yields in accordance with accepted
financial practice and (ii) interpolating linearly between (1) the
actively traded U.S. Treasury security with the duration closest to and
greater than the Remaining Average Life and (2) the actively traded
U.S. Treasury security with the duration closest to and less than the
Remaining Average Life.
"Remaining Average Life" means, with respect to any Called
Principal, the number of years (calculated to the nearest one-twelfth
year) obtained by dividing (a) such Called Principal into (b) the sum
of the products obtained by multiplying (i) the principal component of
each Remaining Scheduled Payment with respect to such Called Principal
by (ii) the number of years (calculated to the nearest one-twelfth
year) that will elapse between the Settlement Date with respect to such
Called Principal and the scheduled due date of such Remaining Scheduled
Payment.
"Remaining Scheduled Payments" means, with respect to the
Called Principal of any Note, all payments of such Called Principal and
interest thereon that would be due after the Settlement Date with
respect to such Called Principal if no payment of such Called Principal
were made prior to its scheduled due date, provided that if such
Settlement Date is not a date on which interest payments are due to be
made under the terms of the Notes, then the amount of the next
succeeding scheduled interest payment will be reduced by the amount of
interest accrued to such Settlement Date and required to be paid on
such Settlement Date pursuant to Section 8.2 or 12.1.
"Settlement Date" means, with respect to the Called Principal
of any Note, the date on which such Called Principal is to be prepaid
pursuant to Section 8.2 or has become or is declared to be immediately
due and payable pursuant to Section 12.1, as the context requires.
58
9. AFFIRMATIVE COVENANTS.
The Company covenants that so long as any of the Notes are outstanding:
9.1 Compliance with Law.
The Company will and will cause each of its Restricted Subsidiaries to
comply with all laws, ordinances or governmental rules or regulations to which
each of them is subject, and will obtain and maintain in effect all licenses,
certificates, permits, franchises and other governmental authorizations
necessary to the ownership of their respective properties or to the conduct of
their respective businesses, in each case to the extent necessary to ensure that
non-compliance with such laws, ordinances or governmental rules or regulations
or failures to obtain or maintain in effect such licenses, certificates,
permits, franchises and other governmental authorizations could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
9.2 Insurance.
The Company will and will cause each of the Restricted Subsidiaries to
maintain, with financially sound and reputable insurers, insurance with respect
to their respective properties and businesses against such casualties and
contingencies, of such types, on such terms and in such amounts (including
deductibles, co-insurance and self-insurance, if adequate reserves are
maintained with respect thereto) as is customary in the case of entities of
established reputations engaged in the same or a similar business and similarly
situated.
9.3 Maintenance of Properties.
The Company will and will cause each of the Restricted Subsidiaries to
maintain and keep, or cause to be maintained and kept, their respective
properties in good repair, working order and condition (other than ordinary wear
and tear), so that the business carried on in connection therewith may be
properly conducted at all times, provided that this Section shall not prevent
the Company or any Restricted Subsidiary from discontinuing the operation and
the maintenance of any of its properties if such discontinuance is desirable in
the conduct of its business and the
Company has concluded that such discontinuance could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
9.4 Payment of Taxes and Claims.
The Company will and will cause each of the Restricted Subsidiaries to
file all tax returns required to be filed in any jurisdiction and to pay and
discharge all taxes shown to be due and payable on such returns and all other
taxes, assessments, governmental charges, or levies imposed on them or any of
their properties, assets, income or franchises, to the extent such taxes,
assessments, charges or levies have become due and payable and before they have
become delinquent and all claims for which sums have become due and payable that
have or might become a Lien on properties or assets of the Company or any
Restricted Subsidiary, provided that neither the Company nor any Restricted
Subsidiary need pay any such tax or assessment or claims if (a) the amount,
applicability or validity thereof is contested by the Company or such Restricted
Subsidiary on a timely basis in good faith and in appropriate proceedings, and
the Company or a Restricted Subsidiary has established adequate
59
reserves therefor in accordance with GAAP on the books of the Company or such
Restricted Subsidiary or (b) the nonpayment of all such taxes, assessments,
charges and levies in the aggregate could not reasonably be expected to have a
Material Adverse Effect.
9.5 Corporate Existence, etc.
The Company will at all times preserve and keep in full force and
effect its corporate existence. Subject to Sections 10.10 and 10.11, the Company
will at all times preserve and keep in full force and effect the corporate
existence of each of the Restricted Subsidiaries (unless merged into the Company
or a Restricted Subsidiary) and all rights and franchises of the Company and the
Restricted Subsidiaries unless, in the good faith judgment of the Company, the
termination of or failure to preserve and keep in full force and effect such
corporate existence, right or franchise could not, individually or in the
aggregate, have a Material Adverse Effect.
9.6 Line of Business.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, engage in any business other than the businesses described in
the Memorandum and businesses reasonably related thereto.
9.7 Additional Guaranty Agreements; Release of Guaranty
Agreements.
(a) Additional Guaranties. The Company will cause each
Subsidiary that at any time becomes liable in respect of any Guaranty
of any of the Company's obligations under the Fleet/Chase Debt Facility
after the Closing Date to become (simultaneously or prior to becoming
liable in respect of such Guaranty of any of the obligations under the
Fleet/Chase Debt Facility) a Guarantor in respect of this Agreement,
the Other Agreement and the Notes by executing and delivering to each
holder of Notes a Guaranty Agreement in the form set out in Exhibit
4.14.
(b) Release of Guaranties. Simultaneously with the release of
any Subsidiary's Guaranty of the Company's obligations under the
Fleet/Chase Debt Facility, such Subsidiary's Guaranty of the Notes
shall be deemed to have been released, provided that such Subsidiary's
Guaranties of the Company's obligations under the Subordinated Notes
and the Existing Notes shall be released at the same time. The holders
of the Notes shall take such action as shall be reasonably requested by
the Company to effect such release. The Company shall give prompt
written notice to all holders of the Notes upon any Subsidiary's being
released from any Guaranty of the Fleet/Chase Debt Facility.
10. NEGATIVE COVENANTS.
The Company covenants that, on and after the Closing Date and so long
as any of the Notes are outstanding:
10.1 Senior Funded Debt.
The Company will not, and will not permit any Restricted Subsidiary to,
directly or indirectly, create, incur, assume, guarantee, or otherwise become
directly or indirectly liable
60
with respect to, any Senior Funded Debt (including, without limitation, Senior
Funded Debt incurred under the Fleet/Chase Debt Facility), other than Existing
Senior Funded Debt, the Notes, InterCompany Debt and Swaps, unless, immediately
after giving effect thereto and to the application of the proceeds thereof (and
without duplication),
(a) no Default or Event of Default exists, and
(b) (i) the sum of
(A) Consolidated Senior Funded Debt plus
(B) the greater of
(1) zero, if there shall have been a
period of 30 consecutive days during the
period of four consecutive fiscal quarters
of the Company then most recently ended when
Consolidated Current Debt was zero, or
(2) the lowest average daily amount
of Consolidated Current Debt outstanding
during any period of 30 consecutive days
during the period of four consecutive fiscal
quarters of the Company then most recently
ended, if Consolidated Current Debt was not
zero during any such period of 30
consecutive days
to
(ii) Pro Forma EBITDA for such period of four
consecutive fiscal quarters,
does not exceed 3.0 to 1.0.
Any Person becoming a Restricted Subsidiary at any time shall be deemed
to have incurred at such time all of its Debt outstanding at such time.
10.2 Subordinated Funded Debt.
The Company will not, and will not permit any Restricted Subsidiary to,
directly or indirectly, create, incur, assume, guarantee, or otherwise become
directly or indirectly liable with respect to, any Subordinated Funded Debt,
other than Existing Subordinated Funded Debt, the Subordinated Notes,
Inter-Company Debt and Swaps, unless, immediately after giving effect thereto
and to the application of the proceeds thereof (and without duplication),
(a) no Default or Event of Default exists, and
(b) (i) the sum of
(A) Consolidated Funded Debt plus
61
(B) the greater of
(1) zero, if there shall have been a
period of 30 consecutive days during the
period of four consecutive fiscal quarters
of the Company then most recently ended when
Consolidated Current Debt was zero, or
(2) the lowest average daily amount
of Consolidated Current Debt outstanding
during any period of 30 consecutive days
during the period of four consecutive fiscal
quarters of the Company then most recently
ended, if Consolidated Current Debt was not
zero during any such period of 30
consecutive days to
(ii) Pro Forma EBITDA for such period of four
consecutive fiscal quarters
does not exceed 3.5 to 1.0.
Any Person becoming a Restricted Subsidiary at any time shall be deemed
to have incurred at such time all of its Debt outstanding at such time.
The Company will not, directly or indirectly, without the written
consent of the Required Holders, (i) amend, modify, supplement, waive compliance
with, or assent to noncompliance with, any term, provision or condition of
Section 13 of the Subordinated Note Purchase Agreements, (ii) increase the
interest rate, or change the amortization schedule, applicable to the
Subordinated Notes as in effect immediately after the consummation of the
issuance thereof or (iii) repurchase, redeem or voluntarily prepay in whole or
in part, any principal, interest or other amounts payable in respect of the
Subordinated Notes, or take any action, or set aside any reserve, in furtherance
of the foregoing, it being understood that (subject to said Section 13) the
foregoing shall not prohibit any scheduled or other required payment of
principal or interest. Notwithstanding the foregoing, the Company may, without
the consent of any holder of Notes, voluntarily prepay the Subordinated Notes
with the proceeds of a Capital Stock offering at any time before May 19, 2000.
10.3 Current Debt.
The Company will not, and will not permit any Restricted Subsidiary to,
directly or indirectly, create, incur, assume, guarantee, or otherwise become
directly or indirectly liable with respect to, any Current Debt, other than
Existing Current Debt, Inter-Company Debt and Swaps, unless, immediately after
giving effect thereto and to the application of the proceeds thereof,
(a) no Default or Event of Default exists, and
(b) there shall have been a period of 30 consecutive days
during the period of 12 consecutive months then most recently ended on
each day of which either
(i) no Consolidated Current Debt was outstanding, or
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(ii) the Company or such Restricted Subsidiary could
have incurred (but did not incur) Senior Funded Debt
pursuant to Section 10.1 in an amount not less than the
amount of Consolidated Current Debt outstanding on such day.
Any Person becoming a Restricted Subsidiary at any time shall be deemed
to have incurred at such time all of its Debt outstanding at such time.
10.4 Interest Coverage Ratio.
The Company will not permit the ratio of (x) Pro Forma EBITDA for any
period of four consecutive fiscal quarters of the Company to (y) Pro Forma
Consolidated Interest Expense for such period to be less than 2.5 to 1.0.
10.5 Liens.
The Company will not, and will not permit any of the Restricted
Subsidiaries to, directly or indirectly create, incur, assume or permit to exist
(upon the happening of a contingency or otherwise) any Lien on or with respect
to any property or asset (including, without limitation, any document or
instrument in respect of goods or accounts receivable) of the Company or any
such Restricted Subsidiary, whether now owned or held or hereafter acquired, or
any income or profits therefrom (whether or not provision is made for the equal
and ratable securing of the Notes in accordance with the last paragraph of this
Section 10.5), or assign or otherwise convey any right to receive income or
profits, except:
(a) Liens existing on the date of this Agreement which secure
Debt of the Company and the Restricted Subsidiaries outstanding on the
Closing Date, which Liens, to the extent not described on Schedule
5.15, secure an aggregate amount of such Debt not in excess of
$2,000,000;
(b) Liens renewing or replacing Liens then in existence and
permitted by paragraph (a) of this Section 10.5 to the extent that the
underlying obligations secured by such existing Liens are being
extended, renewed or refunded, provided that
(i) no such renewal or replacement Lien shall extend
to any property of the Company or any Restricted Subsidiary
other than property already encumbered by the existing Lien
being so renewed or replaced,
(ii) the principal amount of the underlying
obligation secured by such existing Lien which could have been
outstanding at the time of such renewal or replacement shall
not be increased in connection with such renewal or
replacement, and
(iii) immediately prior to, and immediately after
giving effect to, such renewal or replacement, no Default or
Event of Default exists or would exist;
(c) Liens (other than any Lien imposed by ERISA) incurred or
deposits made in the ordinary course of business
63
(i) in connection with workers' compensation, unemployment
insurance and other types of social security or retirement
benefits, or
(ii) to secure (or to obtain letters of credit that secure)
the performance of tenders, statutory obligations, surety bonds,
bids, leases (other than Capital Leases), performance bonds,
purchase, construction or sales contracts and other similar
obligations, in each case not incurred or made in connection with
the borrowing of money, the obtaining of advances or credit or
the payment of the deferred purchase price of property;
(d) (i) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and other similar Liens, in each case
incurred in the ordinary course of business for sums not yet due and
payable or the payment of which is not at the time required by Section 9.4,
and
(ii) Liens arising solely by virtue of any statutory or common
law provisions or, in the case of Infratest or any of its
subsidiaries, Liens arising by virtue of any deposit agreement, in
each case relating to bankers' Liens, rights of set-off or similar
rights and remedies as to deposit accounts or other funds maintained
with a creditor depository institution, provided that such deposit
account is not a dedicated cash collateral account and is not subject
to restrictions against access by the Company or any Restricted
Subsidiary in excess of those set forth by regulations promulgated by
the Federal Reserve Board (or, in the case of Infratest, applicable
German statutes or regulations);
(e) Liens arising from judicial attachments or judgments, or securing
appeal bonds, and other similar Liens, provided that
(i) the execution or other enforcement of such Liens is
effectively stayed, and
(ii) the claims secured thereby are being actively contested in
good faith and adequate reserves in respect thereof have been
established by the Company or such Restricted Subsidiary in accordance
with GAAP;
(f) leases or subleases granted to others, easements, rights-of-way,
restrictions and other similar charges or encumbrances, in each case
incidental to, and not interfering with, the ordinary conduct of the
business of the Company or any of the Restricted Subsidiaries, provided
that such Liens do not, in the aggregate, materially impair the use of such
property by the Company or such Restricted Subsidiary;
(g) Liens for taxes, assessments or other governmental charges which
are not yet due and payable or the payment of which is not at the time
required by Section 9.4;
(h) any Lien existing on property of a Person immediately prior to its
being consolidated with or merged into the Company or a Restricted
Subsidiary, or immediately prior to its becoming a Restricted Subsidiary,
or any Lien existing on any property acquired by the Company or any
Restricted Subsidiary at the time such property is so acquired (whether or
not the Debt secured thereby shall have been assumed), provided that (i) no
such
64
Lien shall have been created or assumed in contemplation of such
consolidation or merger or such acquisition of property, and (ii) each such
Lien shall extend solely to the item or items of property so acquired;
(i) Liens on property of a Restricted Subsidiary, provided that such
Liens secure only Debt owing to the Company or a Restricted Subsidiary; and
(j) other Liens not otherwise permitted by paragraphs (a) through (i)
of this Section 10.5, so long as the sum, without duplication, of
(i) the aggregate amount of Indebtedness secured by such Liens,
plus
(ii) the aggregate amount of unsecured Debt of all Restricted
Subsidiaries, including, without limitation, the IBH Debt, outstanding
at such time (other than any such Debt owing to the Company or other
Restricted Subsidiaries)
shall not exceed 15% of Consolidated Total Capitalization.
If, notwithstanding the prohibition contained herein, the Company
shall, or shall permit any of the Restricted Subsidiaries to, directly or
indirectly create, incur, assume or permit to exist any Lien, other than those
Liens permitted by the provisions of paragraphs (a) through (j) of this Section
10.5, it will make or cause to be made effective provision whereby the Notes
will be secured equally and ratably with any and all other obligations thereby
secured, such security to be pursuant to agreements reasonably satisfactory to
the Required Holders and, in any such case, the Notes shall have the benefit, to
the fullest extent that, and with such priority as, the holders of the Notes may
be entitled under applicable law, of an equitable Lien on such property. Such
violation of this Section 10.5 will constitute an Event of Default, whether or
not provision is made for an equal and ratable Lien pursuant to this Section
10.5. The filing of a financing statement to evidence for information purposes a
lessor's interest in property leased to the Company or a Restricted Subsidiary
shall be deemed not to constitute the creation of a Lien.
10.6 Restricted Subsidiary Debt.
The Company will not at any time permit any Restricted Subsidiary to,
directly or indirectly, create, incur, assume, guarantee, or otherwise be or
become directly or indirectly liable with respect to, any Debt, other than (x)
Debt owing to any other Restricted Subsidiary or to the Company (including any
Guaranty of any Debt of any Restricted Subsidiary) and (y) the Excluded
Guaranties, unless (without duplication)
(a) the aggregate amount of unsecured Debt of all Restricted
Subsidiaries, including, without limitation, the IBH Debt, outstanding at
such time (other than (i) any such Debt owing to the Company or Restricted
Subsidiaries and (ii) the Excluded Guaranties), plus
(b) the aggregate amount of obligations secured by Liens permitted
pursuant to Section 10.5(j) outstanding at such time,
does not exceed 15% of Consolidated Total Capitalization determined at such
time.
65
10.7 Consolidated Net Worth.
The Company will not, at any time, permit Consolidated Net Worth to be
less than the sum of (a) $95,000,000 plus (b) an aggregate amount equal to 50%
of Consolidated Net Income (but only if a positive number) for each completed
fiscal quarter as of such time beginning with the fiscal quarter ending December
31, 1998.
10.8 Sale-and-Leaseback Transactions.
The Company will not, and will not permit any Restricted Subsidiary to,
enter into any Sale-and-Leaseback Transaction, unless, immediately after giving
effect thereto, the aggregate amount of all Attributable Debt of the Company and
the Restricted Subsidiaries, determined on a consolidated basis, would not
exceed $5,000,000.
10.9 Restricted Investments.
The Company will not, and will not permit any of the Restricted
Subsidiaries to, declare, make or authorize any Restricted Investment unless
immediately after giving effect to such action:
(a) the aggregate value of all Restricted Investments of the Company
and the Restricted Subsidiaries (valued immediately after such action)
would not exceed 10% of Consolidated Total Capitalization; and
(b) no Default or Event of Default would exist.
Any designation of a Restricted Subsidiary as an Unrestricted Subsidiary shall
be deemed to be the making of a Restricted Investment by the owner of the
Capital Stock of such newly designated Unrestricted Subsidiary in an amount
equal to all the share capital and other Investments in such Unrestricted
Subsidiary held by the Company and each other Restricted Subsidiary. For the
avoidance of doubt, it is understood that any Restricted Investments outstanding
prior to the Closing Date shall be deemed not to have been declared, made or
authorized at a time when this covenant was effective.
10.10 Merger, Consolidation, Etc.
The Company will not, and will not permit any Restricted Subsidiary to,
consolidate with or merge with any other corporation or convey, transfer or
lease substantially all of its assets in a single transaction or series of
transactions to any Person except that:
(a) the Company may consolidate with or merge with another corporation
or convey or transfer (except by lease) all or substantially all of its
assets in a single transaction or series of transactions to another Person
if:
(i) the successor formed by such consolidation or the survivor of
such merger or the Person that acquires by conveyance or transfer all
or substantially all of the assets of the Company as an entirety, as
the case may be (the "Successor Corporation"), shall be a solvent
corporation organized and existing under the laws of the United States
of America, any State thereof or the District of Columbia;
66
(ii) if the Company is not the Successor Corporation, such
corporation shall have executed and delivered to each holder of Notes
its assumption of the due and punctual performance and observance of
each covenant and condition of this Agreement and the Notes (pursuant
to such agreements and instruments as shall be reasonably satisfactory
to the Required Holders), and the Company shall have caused to be
delivered to each holder of Notes an opinion of nationally recognized
independent counsel, or other independent counsel reasonably
satisfactory to the Required Holders, to the effect that all
agreements or instruments effecting such assumption are enforceable in
accordance with their terms and comply with the terms hereof; and
(iii) immediately after giving effect to such transaction:
(A) no Default or Event of Default would exist, and
(B) the Successor Corporation would be able to incur $1 of
Funded Debt pursuant to both Section 10.1 and Section 10.2;
(b) a Restricted Subsidiary may consolidate with or merge with the
Company (so long as the Company is the surviving corporation) or another
Restricted Subsidiary or convey, transfer or lease all or substantially all
of its assets in a single transaction or series of transactions to the
Company or another Restricted Subsidiary; and
(c) a Restricted Subsidiary may consolidate with or merge with another
corporation or convey, transfer or lease all or substantially all of its
assets in a single transaction or series of transactions to another Person
if:
(i) such transaction is in compliance with Section 10.11 hereof;
or
(ii) immediately after giving effect to such transaction:
(A) no Default or Event of Default would exist, and
(B) the Company would be able to incur $1 of Funded Debt
pursuant to both Section 10.1 and Section 10.2.
No such conveyance or transfer of all or substantially all of the assets of the
Company shall have the effect of releasing the Company or any Successor
Corporation from its liability under this Agreement or the Notes.
10.11 Sale of Assets, Etc.
(a) Sale of Assets. The Company will not, and will not permit any
Restricted Subsidiary to, make any Asset Disposition unless:
(i) in the good faith opinion of the Company, the Asset
Disposition is in exchange for consideration having a Fair Market
Value at least equal to that of the
67
property exchanged and is in the best interest of the Company or such
Restricted Subsidiary;
(ii) immediately after giving effect to the Asset Disposition, no
Default or Event of Default would exist; and
(iii) immediately after giving effect to the Asset Disposition,
the sum of the Net Proceeds Amounts in respect of all property that
was the subject of any Asset Disposition occurring in the period of
365 days ending with and including the date of such Asset Disposition,
minus the aggregate cost of Capital Assets acquired by the Company and
the Restricted Subsidiaries during such period, would not exceed 15%
of Consolidated Total Assets as of the end of the then most recently
ended fiscal year of the Company.
(b) Disposal of Ownership of a Restricted Subsidiary. The Company will
not, and will not permit any of the Restricted Subsidiaries to, sell or
otherwise dispose of any shares of Restricted Subsidiary Stock (including,
without limitation, pursuant to any merger, consolidation or other
transaction specified in Section 10.10(c) hereof, but excluding any
transaction permitted by Section 10.10(b) hereof), nor will the Company
permit any such Restricted Subsidiary to issue, sell or otherwise dispose
of any shares of its own Restricted Subsidiary Stock, provided that the
foregoing restrictions do not apply to:
(i) the issue of directors' qualifying shares by any such
Subsidiary;
(ii) any such Transfer of Restricted Subsidiary Stock
constituting a Transfer described in clause (a) of the definition of
"Asset Disposition"; and
(iii) the Transfer of all of the Restricted Subsidiary Stock of a
Restricted Subsidiary owned by the Company and the other Restricted
Subsidiaries if:
(A) such Transfer satisfies the requirements of Section
10.11(a) hereof,
(B) in connection with such Transfer the entire Investment
(whether represented by stock, Debt, claims or otherwise) of the
Company and the other Restricted Subsidiaries in such Restricted
Subsidiary is sold, transferred or otherwise disposed of to a
Person other than (1) the Company, (2) another Restricted
Subsidiary not being simultaneously disposed of, or (3) an
Affiliate, and
(C) the Restricted Subsidiary being disposed of has no
continuing Investment in any other Restricted Subsidiary not
being simultaneously disposed of or in the Company.
Any designation of a Restricted Subsidiary as an Unrestricted
Subsidiary shall be deemed to be an Asset Disposition of all of the Restricted
Subsidiary Stock of such newly designated Unrestricted Subsidiary.
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(c) Release of Guaranties of Subsidiaries. If, with respect to any
Subsidiary that is a Guarantor,
(i) all of the Company's and any Restricted Subsidiary's Capital
Stock or other equity ownership interests in such Guarantor is
Transferred (including by way of a merger) to a Person other than the
Company or a Restricted Subsidiary in accordance with the requirements
of this Section 10.11,
(ii) such Guarantor engages in a transaction permitted by Section
10.10(c) with any such Person and the surviving Person or transferee
is not a Subsidiary, or
(iii) such Guarantor sells all or substantially all of its assets
to another Subsidiary or the Company and, in the case of a sale to
another Subsidiary, such other Subsidiary becomes a Guarantor by
executing a Guaranty Agreement, then the Company may elect to cause
the withdrawal of the Guaranty Agreement of such Guarantor. Such
election may be exercised if (A) no Default or Event of Default exists
and (B) such Guarantor has no Guaranty obligation in respect of any
Debt under the Fleet/Chase Debt Facility, the Existing Notes or the
Subordinated Notes (except any such obligation which is being released
simultaneously with the release of such Guaranty Agreement), and if a
Senior Financial Officer of the Company certifies in writing to each
holder of Notes that the conditions specified in the foregoing clauses
(A) and (B) have been satisfied. Thereafter, the Guaranty Agreement of
such Guarantor shall be terminated, null and void and without effect
and, upon request of the Company, and in reliance on the accuracy of
the Company's written certification, each holder of Notes shall
acknowledge such termination.
10.12 Limitation on Contribution to Company Financial Performance by
Unrestricted Subsidiaries.
(a) The Company will not at any time permit Consolidated Total Assets
to be less than 80% of consolidated total assets of the Company and its
Subsidiaries as reflected on a consolidated balance sheet of such Persons
prepared in accordance with GAAP.
(b) The Company will not permit Pro Forma EBITDA for any period of
four consecutive fiscal quarters of the Company to be less than 80% of Pro
Forma EBITDA (determined as if each reference in such definition to
"Restricted Subsidiaries" were to "Subsidiaries") for such period.
10.13 Transactions with Affiliates.
Except as set forth in Schedule 10.13, the Company will not, and will
not permit any Restricted Subsidiary to, enter into directly or indirectly any
transaction or group of related transactions (including, without limitation, the
purchase, lease, sale or exchange of properties of any kind or the rendering of
any service) with any Affiliate (other than the Company or another Restricted
Subsidiary), except in the ordinary course and pursuant to the reasonable
requirements of the Company's or such Restricted Subsidiary's business and upon
fair and reasonable terms no less favorable to the Company or such Restricted
Subsidiary than would be obtainable in a comparable arm's-length transaction
with a Person not an Affiliate.
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10.14 Leverage Ratios.
(a) Senior Leverage Ratio. The Company will not permit the ratio of
(x) Consolidated Senior Funded Debt, determined at the end of any fiscal
quarter of the Company, to (y) Pro Forma EBITDA for the period of four
consecutive fiscal quarters of the Company ending with, and including, such
fiscal quarter to be greater than 3.25 to 1.0.
(b) Total Leverage Ratio. The Company will not permit the ratio of (x)
Consolidated Funded Debt, determined at the end of any fiscal quarter of
the Company, to (y) Pro Forma EBITDA for the period of four consecutive
fiscal quarters of the Company ending with, and including, such fiscal
quarter to be greater than (i) 3.75 to 1.0 at any time on or before
December 31, 1999 and (ii) 3.50 to 1.0 at any time thereafter.
10.15 Limit on Acquisitions.
The Company will not, and will not permit any Restricted Subsidiary to,
make any Acquisition unless:
(a) no Default or Event of Default exists or would result from such
Acquisition;
(b) the Person or assets acquired, as the case may be, involve
substantially the same or a similar line of business engaged in by the
Company and its Restricted Subsidiaries;
(c) the Company demonstrates that, on a consolidated basis with the
Person and/or assets to be acquired, in accordance with GAAP, the Company
would have been in compliance with Sections 10.4, 10.7, 10.14(a) and
10.14(b) on a trailing four quarters pro forma basis as of the last day of
the then most recently completed fiscal quarter of the Company; and
(d) the aggregate amount expended by the Company and its Restricted
Subsidiaries, whether in cash, Securities or other property, for all
Acquisitions permitted hereunder within any one calendar year does not
exceed $20,000,000 or its equivalent in other currencies.
10.16 IBH Debt.
The Company will not permit the IBH Debt to be renewed, replaced,
extended or refinanced and shall not permit the maximum aggregate principal
amount thereof which may be outstanding at any time to exceed the sum of (x)
68,000,000 Deutsche Marks and (y) $10,000,000 (or the equivalent thereof in
other currencies).
11. EVENTS OF DEFAULT.
An "Event of Default" shall exist if any of the following conditions or
events shall occur and be continuing:
70
(a) the Company defaults in the payment of any principal or Make-Whole
Amount, if any, on any Note when the same becomes due and payable, whether
at maturity or at a date fixed for prepayment or by declaration or
otherwise; or
(b) the Company defaults in the payment of any interest on any Note
for more than five Business Days after the same becomes due and payable; or
(c) the Company defaults in the performance of or compliance with any
term contained in any of Sections 10.1 through 10.12, inclusive, Section
10.14 through Section 10.16, inclusive, or Section 7.1(d); or
(d) the Company defaults in the performance of or compliance with any
term contained herein (other than those referred to in paragraphs (a), (b)
and (c) of this Section 11) and such default is not remedied within 30 days
after the earlier of (i) a Responsible Officer obtaining actual knowledge
of such default and (ii) the Company receiving written notice of such
default from any holder of a Note; or
(e) any representation or warranty made in writing by or on behalf of
the Company or by any officer of the Company in this Agreement or in any
writing furnished in connection with the transactions contemplated hereby
proves to have been false or incorrect in any material respect on the date
as of which made; or
(f) (i) the Company or any Restricted Subsidiary is in default (as
principal or as guarantor or other surety) in the payment of any principal
of or premium or make- whole amount or interest on any Indebtedness (other
than Indebtedness under this Agreement and the Notes) beyond any period of
grace provided with respect thereto (after giving effect to any consents or
waivers in respect thereof), that individually or together with such other
Indebtedness as to which any such failure exists has an aggregate
outstanding principal amount of at least $2,000,000, or
(ii) the Company or any Restricted Subsidiary is in default in
the performance of or compliance with any term of any evidence of any
Indebtedness (other than Indebtedness under this Agreement and the
Notes), that individually or together with such other Indebtedness as
to which any such failure exists has an aggregate outstanding
principal amount of at least $2,000,000, or of any mortgage, indenture
or other agreement relating thereto or any other condition exists, and
as a consequence of such default or condition such Indebtedness has
become, or has been declared (or, after giving effect to any consents
or waivers in respect thereof, one or more Persons are entitled to
declare such Indebtedness to be), due and payable before its stated
maturity or before its regularly scheduled dates of payment, or
(iii) as a consequence of the occurrence or continuation of any
event or condition (other than the passage of time or the right of the
holder of Indebtedness to convert such Indebtedness into equity
interests),
(A) the Company or any Subsidiary has become obligated to
purchase or repay Indebtedness before its regular maturity or
before its
71
regularly scheduled dates of payment in an aggregate outstanding
principal amount of at least $2,000,000, or
(B) one or more Persons have the right to require the
Company or any Subsidiary so to purchase or repay such
Indebtedness, or
(iv) the Company is in default in the performance of or
compliance with any term of the Indebtedness evidenced by the
Subordinated Notes or of the Subordinated Note Purchase Agreements, or
of any other agreement relating thereto or any other condition exists,
and as a consequence of such default or condition such Indebtedness
has become, or has been declared, due and payable before its stated
maturity or before its regularly scheduled dates of payment; or
(g) the Company or any Restricted Subsidiary (i) is generally not
paying, or admits in writing its inability to pay, its debts as they become
due, (ii) files, or consents by answer or otherwise to the filing against
it of, a petition for relief or reorganization or arrangement or any other
petition in bankruptcy, for liquidation or to take advantage of any
bankruptcy, insolvency, reorganization, moratorium or other similar law of
any jurisdiction, (iii) makes an assignment for the benefit of its
creditors, (iv) consents to the appointment of a custodian, receiver,
trustee or other officer with similar powers with respect to it or with
respect to any substantial part of its property, (v) is adjudicated as
insolvent or to be liquidated, or (vi) takes corporate action for the
purpose of any of the foregoing; or
(h) a court or governmental authority of competent jurisdiction enters
an order appointing, without consent by the Company or any Restricted
Subsidiary, a custodian, receiver, trustee or other officer with similar
powers with respect to the Company or any Restricted Subsidiary or with
respect to any substantial part of the property of the Company or any
Restricted Subsidiary, or constituting an order for relief or approving a
petition for relief or reorganization or any other petition in bankruptcy
or for liquidation or to take advantage of any bankruptcy or insolvency law
of any jurisdiction, or ordering the dissolution, winding-up or liquidation
of the Company or any Restricted Subsidiary, or any such petition shall be
filed against the Company or any Restricted Subsidiary and such petition
shall not be dismissed within 60 days; or
(i) a final judgment or judgments for the payment of money aggregating
in excess of $1,000,000 above the level of coverage provided by any
applicable insurance policy are rendered against one or more of the Company
and the Restricted Subsidiaries and which judgments are not, within 30 days
after entry thereof, bonded, discharged or stayed pending appeal, or are
not discharged within 30 days after the expiration of such stay; or
(j) except as otherwise specifically permitted by this Agreement
(including, without limitation, Sections 9.7(c) and 10.11(c)) or the
Guaranty Agreement,
(i) any of the Guaranty Agreements shall cease to be in full
force and effect or shall be declared by a court or Governmental
Authority of competent jurisdiction to be void or unenforceable
against the Guarantor thereunder,
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(ii) the validity or enforceability of any of the Guaranty
Agreements against the Guarantor thereunder shall be contested by such
Guarantor, the Company or any Person owning, directly or indirectly, a
majority of the common stock of the Company, or
(iii) any Guarantor, the Company or any such Person identified in
clause (ii) of this Section 11(j) shall deny that such Guarantor has
any further liability or obligation under such Guarantor's Guaranty
Agreement; or
(k) if (i) any Plan shall fail to satisfy the minimum funding
standards of ERISA or the Code for any plan year or part thereof or a
waiver of such standards or extension of any amortization period is sought
or granted under section 412 of the Code,
(ii) a notice of intent to terminate any Plan shall have been or
is reasonably expected to be filed with the PBGC or the PBGC shall
have instituted proceedings under ERISA section 4042 to terminate or
appoint a trustee to administer any Plan or the PBGC shall have
notified the Company or any ERISA Affiliate that a Plan may become a
subject of any such proceedings,
(iii) the aggregate "amount of unfunded benefit liabilities"
(within the meaning of section 4001(a)(18) of ERISA) under all Plans,
determined in accordance with Title IV of ERISA, shall exceed
$6,000,000,
(iv) the Company or any ERISA Affiliate shall have incurred or is
reasonably expected to incur any liability pursuant to Title I or IV
of ERISA or the penalty or excise tax provisions of the Code relating
to employee benefit plans,
(v) the Company or any ERISA Affiliate withdraws from any
Multiemployer Plan, or
(vi) the Company or any Subsidiary establishes or
amends any employee welfare benefit plan that provides
post-employment welfare benefits in a manner that would
increase the liability of the Company or any Subsidiary
thereunder;
and any such event or events described in clauses (i) through (vi) above,
either individually or together with any other such event or events, could
reasonably be expected to have a Material Adverse Effect.
As used in Section 11(k), the terms "employee benefit plan" and "employee
welfare benefit plan" shall have the respective meanings assigned to such terms
in section 3 of ERISA.
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12. REMEDIES ON DEFAULT, ETC.
12.1 Acceleration.
(a) If an Event of Default with respect to the Company
described in paragraph (g) or paragraph (h) of Section 11 (other than
an Event of Default described in clause (i) of paragraph (g) or
described in clause (vi) of paragraph (g) by virtue of the fact that
such clause encompasses clause (i) of paragraph (g)) has occurred, all
the Notes then outstanding shall automatically become immediately due
and payable.
(b) If any other Event of Default has occurred and is
continuing, any holder or holders of more than 66-2/3% in principal
amount of the Notes at the time outstanding may at any time at its or
their option, by notice or notices to the Company, declare all the
Notes then outstanding to be immediately due and payable.
(c) If any Event of Default described in paragraph (a) or (b)
of Section 11 has occurred and is continuing, any holder or holders of
Notes at the time outstanding affected by such Event of Default may at
any time, at its or their option, by notice or notices to the Company,
declare all the Notes held by it or them to be immediately due and
payable.
Upon any Notes becoming due and payable under this Section 12.1,
whether automatically or by declaration, such Notes will forthwith mature and
the entire unpaid principal amount of such Notes, plus (x) all accrued and
unpaid interest thereon and (y) the Make-Whole Amount determined in respect of
such principal amount (to the full extent permitted by applicable law), shall
all be immediately due and payable, in each and every case without presentment,
demand, protest or further notice, all of which are hereby waived. The Company
acknowledges, and the parties hereto agree, that each holder of a Note has the
right to maintain its investment in the Notes free from repayment by the Company
(except as herein specifically provided for) and that the provision for payment
of a Make-Whole Amount by the Company in the event that the Notes are prepaid or
are accelerated as a result of an Event of Default, is intended to provide
compensation for the deprivation of such right under such circumstances.
12.2 Other Remedies.
If any Default or Event of Default has occurred and is continuing, and
irrespective of whether any Notes have become or have been declared immediately
due and payable under Section 12.1, the holder of any Note at the time
outstanding may proceed to protect and enforce the rights of such holder by an
action at law, suit in equity or other appropriate proceeding, whether for the
specific performance of any agreement contained herein or in any Note, or for an
injunction against a violation of any of the terms hereof or thereof, or in aid
of the exercise of any power granted hereby or thereby or by law or otherwise.
12.3 Rescission.
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At any time after any Notes have been declared due and payable pursuant
to clause (b) or clause (c) of Section 12.1, the holders of not less than
66-2/3% in principal amount of the Notes then outstanding, by written notice to
the Company, may rescind and annul any such declaration and its consequences if
(a) the Company has paid all overdue interest on the Notes, all principal of and
Make-Whole Amount, if any, due and payable on any Notes other than by reason of
such declaration, and all interest on such overdue principal and Make-Whole
Amount, if any, and (to the extent permitted by applicable law) any overdue
interest in respect of the Notes, at the Default Rate, (b) all Events of Default
and Defaults, other than non-payment of amounts that have become due solely by
reason of such declaration, have been cured or have been waived pursuant to
Section 17, and (c) no judgment or decree has been entered for the payment of
any monies due pursuant hereto or to the Notes. No rescission and annulment
under this Section 12.3 will extend to or affect any subsequent Event of Default
or Default or impair any right consequent thereon.
12.4 No Waivers or Election of Remedies, Expenses, etc.
No course of dealing and no delay on the part of any holder of any Note
in exercising any right, power or remedy shall operate as a waiver thereof or
otherwise prejudice such holder's rights, powers or remedies. No right, power or
remedy conferred by this Agreement or by any Note upon any holder thereof shall
be exclusive of any other right, power or remedy referred to herein or therein
or now or hereafter available at law, in equity, by statute or otherwise.
Without limiting the obligations of the Company under Section 15, the Company
will pay to the holder of each Note on demand such further amount as shall be
sufficient to cover all costs and expenses of such holder incurred in any
enforcement or collection under this Section 12, including, without limitation,
reasonable attorneys' fees, expenses and disbursements.
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.
13.1 Registration of Notes.
The Company shall keep at its principal executive office a register for
the registration and registration of transfers of Notes. The name and address of
each holder of one or more Notes, each transfer thereof and the name and address
of each transferee of one or more Notes shall be registered in such register.
Prior to due presentment for registration of transfer, the Person in whose name
any Note shall be registered shall be deemed and treated as the owner and holder
thereof for all purposes hereof, and the Company shall not be affected by any
notice or knowledge to the contrary. The Company shall give to any holder of a
Note that is an Institutional Investor promptly upon request therefor, a
complete and correct copy of the names and addresses of all registered holders
of Notes.
13.2 Transfer and Exchange of Notes.
Upon surrender of any Note at the principal executive office of the
Company for registration of transfer or exchange (and in the case of a surrender
for registration of transfer, duly endorsed or accompanied by a written
instrument of transfer duly executed by the registered holder of such Note or
his attorney duly authorized in writing and accompanied by the address for
notices of each transferee of such Note or part thereof), the Company shall
execute and deliver, at the Company's expense (except as provided below), one or
more new Notes (as requested by the holder thereof) in exchange therefor, in an
aggregate principal amount equal to the unpaid principal amount of the
surrendered Note. Each such new Note shall be payable to such Person as such
holder may request
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and shall be substantially in the form of Exhibit 1-A or Exhibit 1-B, as the
case may be. Each such new Note shall be dated and bear interest from the date
to which interest shall have been paid on the surrendered Note or dated the date
of the surrendered Note if no interest shall have been paid thereon. The Company
may require payment of a sum sufficient to cover any stamp tax or governmental
charge imposed in respect of any such transfer of Notes. Notes shall not be
transferred in denominations of less than $100,000, provided that if necessary
to enable the registration of transfer by a holder of its entire holding of
Notes, one Note may be in a denomination of less than $100,000. Any transferee,
by its acceptance of a Note registered in its name (or the name of its nominee),
shall be deemed to have made the representations set forth in Section 6.2 and in
the second sentence of Section 6.1.
13.3 Replacement of Notes.
Upon receipt by the Company of evidence reasonably satisfactory to it
of the ownership of and the loss, theft, destruction or mutilation of any Note
(which evidence shall be, in the case of an Institutional Investor, notice from
such Institutional Investor of such ownership and such loss, theft, destruction
or mutilation), and
(a) in the case of loss, theft or destruction, of indemnity reasonably
satisfactory to it (provided that if the holder of such Note is, or is a
nominee for, an original purchaser or a Qualified Institutional Buyer, such
Person's own unsecured agreement of indemnity shall be deemed to be
satisfactory), or
(b) in the case of mutilation, upon surrender and cancellation
thereof,
the Company at its own expense shall execute and deliver, in lieu thereof, a new
Note, dated and bearing interest from the date to which interest shall have been
paid on such lost, stolen, destroyed or mutilated Note or dated the date of such
lost, stolen, destroyed or mutilated Note if no interest shall have been paid
thereon.
14. PAYMENTS ON NOTES.
14.1 Place of Payment.
Subject to Section 14.2, payments of principal, Make-Whole Amount, if
any, and interest becoming due and payable on the Notes shall be made in
Greenwich, Connecticut at the principal office of the Company in such
jurisdiction. The Company may at any time, by notice to each holder of a Note,
change the place of payment of the Notes so long as such place of payment shall
be either the principal office of the Company in such jurisdiction or the
principal office of a bank or trust company in such jurisdiction.
14.2 Home Office Payment.
So long as you or your nominee shall be the holder of any Note, and
notwithstanding anything contained in Section 14.1 or in such Note to the
contrary, the Company will pay all sums becoming due on such Note for principal,
Make-Whole Amount, if any, and interest by the method and at the address
specified for such purpose below your name in Schedule A, or by such other
method or at such other address as you shall have from time to time specified to
the Company in
76
writing for such purpose, without the presentation or surrender of such Note or
the making of any notation thereon, except that upon written request of the
Company made concurrently with or reasonably promptly after payment or
prepayment in full of any Note, you shall surrender such Note for cancellation,
reasonably promptly after any such request, to the Company at its principal
executive office or at the place of payment most recently designated by the
Company pursuant to Section 14.1. Prior to any sale or other disposition of any
Note held by you or your nominee you will, at your election, either endorse
thereon the amount of principal paid thereon and the last date to which interest
has been paid thereon or surrender such Note to the Company in exchange for a
new Note or Notes pursuant to Section 13.2. The Company will afford the benefits
of this Section 14.2 to any Institutional Investor that is the direct or
indirect transferee of any Note purchased by you under this Agreement and that
has made the same agreement relating to such Note as you have made in this
Section 14.2.
15. EXPENSES, ETC.
15.1 Transaction Expenses.
The Company will pay all costs and expenses (including any judgment or
settlement approved by the Company, reasonable attorneys' fees of a special
counsel and, if reasonably required, local or other counsel) incurred by you and
the Other Purchaser or holder of a Note in connection with (a) the negotiation,
execution and documentation of the transactions contemplated hereby, (b) any
amendments, waivers or consents under or in respect of this Agreement or the
Notes (whether or not such amendment, waiver or consent becomes effective), and
(c) any actual or threatened proceeding relating to any action the Company has
taken, or will take, as to which the Company has made a representation and
warranty hereunder, including, without limitation: (x) the costs and expenses
incurred in enforcing or defending (or determining whether or how to enforce or
defend) any rights under this Agreement or the Notes or in responding to any
subpoena or other legal process or informal investigative demand issued in
connection with this Agreement or the Notes, or by reason of being a holder of
any Note, and (y) the costs and expenses, including financial advisors' fees,
incurred in connection with the insolvency or bankruptcy of the Company or any
Subsidiary or in connection with any work-out or restructuring of the
transactions contemplated hereby and by the Notes. The Company will pay, and
will save you and each other holder of a Note harmless from, all claims in
respect of any fees, costs or expenses if any, of brokers and finders (other
than those retained by you).
15.2 Survival.
The obligations of the Company under this Section 15 will survive the
payment or transfer of any Note, the enforcement, amendment or waiver of any
provision of this Agreement or the Notes, and the termination of this Agreement.
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.
77
All representations and warranties contained herein shall survive the
execution and delivery of this Agreement and the Notes, the purchase or transfer
by you of any Note or portion thereof or interest therein and the payment of any
Note, and may be relied upon by any subsequent holder of a Note, regardless of
any investigation made at any time by or on behalf of you or any other holder of
a Note. All statements contained in any certificate or other instrument
delivered by or on behalf of the Company pursuant to this Agreement shall be
deemed representations and warranties of the Company under this Agreement.
Subject to the preceding sentence, this Agreement and the Notes embody the
entire agreement and understanding between you and the Company and supersede all
prior agreements and understandings relating to the subject matter hereof.
17. AMENDMENT AND WAIVER.
17.1 Requirements.
This Agreement and the Notes may be amended, and the observance of any
term hereof or of the Notes may be waived (either retroactively or
prospectively), with (and only with) the written consent of the Company and the
Required Holders, except that (a) no amendment or waiver of any of the
provisions of any of Sections 1, 2, 3, 4, 5, 6 and 21, or any defined term (as
it is used therein), will be effective as to you unless consented to by you in
writing, and (b) no such amendment or waiver may, without the written consent of
the holder of each Note at the time outstanding affected thereby, (i) subject to
the provisions of Section 12 relating to acceleration or rescission, change the
amount or time of any payment or prepayment of principal of, or reduce the rate
or change the time of payment or method of computation of interest or of the
Make-Whole Amount on, the Notes, (ii) change the percentage of the principal
amount of the Notes the holders of which are required to consent to any such
amendment or waiver, or (iii) amend any of Sections 8, 11(a), 11(b), 12, 17 and
20.
Notwithstanding the provisions of the immediately preceding paragraph,
you and the Other Purchaser agree, and each other holder of Notes by its
acceptance of any Note shall be deemed to have agreed, to grant its written
consent, promptly following the receipt of a written request by the Company for
such consent, to any amendment of, or waiver with respect to (prospectively
only), clause (ii) of Section 10.14(b), Section 10.15 or Section 10.16 in a
manner consistent with any one or more amendments of, or waivers with respect
to, the covenants in the Fleet/Chase Debt Facility that correspond to clause
(ii) of Section 10.14(b), Section 10.15 or Section 10.16, as the case may be
(the "Fleet/Chase Equivalent Provisions"); provided that (A) the Company shall
have delivered to each holder of Notes a copy of such amendment or waiver
relating to the Fleet/Chase Debt Facility, together with a certificate of a
Responsible Officer of the Company to the effect that such copy is true and
complete and that such amendment or waiver relating to the Fleet/Chase Debt
Facility has become effective in accordance with the terms of the Fleet/Chase
Debt Facility and (B) the effect of the requested amendment or waiver relating
to clause (ii) of Section 10,14(b), Section 10.15 or Section 10.16, as the case
may be, shall be no less favorable (and no more onerous) to the holders of Notes
than the corresponding amendment or waiver relating to the Fleet/Chase Debt
Facility is to the banks that are parties thereto. In addition, if any or all of
the Fleet/Chase Equivalent Provisions are deleted from the Fleet/Chase Debt
Facility, or such facility is terminated and not replaced by a substantially
similar facility containing provisions equivalent to the Fleet/Chase Equivalent
Provisions, then one or more of clause (ii) of Section 10.14(b), Section 10.15
and Section 10.16, whichever shall correspond to the provisions eliminated from
the Fleet/Chase Debt Facility (or all such Sections if the Fleet/Chase Debt
Facility shall be terminated and not replaced, as stated above), shall be deemed
78
to have been automatically deleted from this Agreement without the need for any
action by the Company or the holders of the Notes.
17.2 Solicitation of Holders of Notes.
(a) Solicitation. The Company will provide each holder of the
Notes (irrespective of the amount of Notes then owned by it) with
sufficient information, sufficiently far in advance of the date a
decision is required, to enable such holder to make an informed and
considered decision with respect to any proposed amendment, waiver or
consent in respect of any of the provisions hereof or of the Notes. The
Company will deliver executed or true and correct copies of each
amendment, waiver or consent effected pursuant to the provisions of
this Section 17 to each holder of outstanding Notes promptly following
the date on which it is executed and delivered by, or receives the
consent or approval of, the requisite holders of Notes.
(b) Payment. The Company will not directly or indirectly pay
or cause to be paid any remuneration, whether by way of supplemental or
additional interest, fee or otherwise, or grant any security, to any
holder of Notes as consideration for or as an inducement to the
entering into by any holder of Notes of any waiver or amendment of any
of the terms and provisions hereof unless such remuneration is
concurrently paid, or security is concurrently granted, on the same
terms, ratably to each holder of Notes then outstanding even if such
holder did not consent to such waiver or amendment.
17.3 Binding Effect, etc.
Any amendment or waiver consented to as provided in this Section 17
applies equally to all holders of Notes and is binding upon them and upon each
future holder of any Note and upon the Company without regard to whether such
Note has been marked to indicate such amendment or waiver. No such amendment or
waiver will extend to or affect any obligation, covenant, agreement, Default or
Event of Default not expressly amended or waived or impair any right consequent
thereon. No course of dealing between the Company and the holder of any Note nor
any delay in exercising any rights hereunder or under any Note shall operate as
a waiver of any rights of any holder of such Note. As used herein, the term
"this Agreement" and references thereto shall mean this Agreement as it may from
time to time be amended or supplemented.
17.4 Notes held by Company, etc.
Solely for the purpose of determining whether the holders of the
requisite percentage of the aggregate principal amount of Notes then outstanding
approved or consented to any amendment, waiver or consent to be given under this
Agreement or the Notes, or have directed the taking of any action provided
herein or in the Notes to be taken upon the direction of the holders of a
specified percentage of the aggregate principal amount of Notes then
outstanding, Notes directly or indirectly owned by the Company or any of its
Affiliates shall be deemed not to be outstanding.
18. NOTICES.
All notices and communications provided for hereunder shall be in
writing and sent (a) by telecopy if the sender on the same day sends a
confirming copy of such notice by a recognized
79
overnight delivery service (charges prepaid), or (b) by registered or certified
mail with return receipt requested (postage prepaid), or (c) by a recognized
overnight delivery service (with charges prepaid). Any such notice must be sent:
(i) if to you or your nominee, to you or it at the
address specified for such communications in Schedule A, or at
such other address as you or it shall have specified to the
Company in writing,
(ii) if to any other holder of any Note, to such
holder at such address as such other holder shall have
specified to the Company in writing, or
(iii) if to the Company, to the Company at its
address set forth at the beginning hereof to the attention of
Xxxxxxx X. Xxxxx, Executive Vice President, Finance & Chief
Financial Officer, telecopier: 000-000-0000, or at such other
address as the Company shall have specified to the holder of
each Note in writing.
Notices under this Section 18 will be deemed given on the earlier of the date of
actual receipt thereof or the third Business Day after such notice shall have
been sent in the manner provided above.
19. REPRODUCTION OF DOCUMENTS.
This Agreement and all documents relating hereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by you at the Closing (except the Notes
themselves), and (c) financial statements, certificates and other information
previously or hereafter furnished to you, may be reproduced by you by any
photographic, photostatic, microfilm, microcard, miniature photographic or other
similar process and you may destroy any original document so reproduced. The
Company agrees and stipulates that, to the extent permitted by applicable law,
any such reproduction shall be admissible in evidence as the original itself in
any judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by you in the regular
course of business) and any enlargement, facsimile or further reproduction of
such reproduction shall likewise be admissible in evidence. This Section 19
shall not prohibit the Company or any other holder of Notes from contesting any
such reproduction to the same extent that it could contest the original, or from
introducing evidence to demonstrate the inaccuracy of any such reproduction.
20. CONFIDENTIAL INFORMATION.
For the purposes of this Section 20, "Confidential Information" means
information delivered to you by or on behalf of the Company or any Subsidiary in
connection with the transactions contemplated by or otherwise pursuant to this
Agreement that is proprietary in nature and that was clearly marked or labeled
or otherwise adequately identified when received by you as being confidential
information of the Company or such Subsidiary, provided that such term does not
include information that
(a) was publicly known or otherwise known to you prior to the time of
such disclosure,
80
(b) subsequently becomes publicly known through no act or omission by
you or any person acting on your behalf,
(c) otherwise becomes known to you other than through disclosure by
the Company or any Subsidiary or by any other holder of a Note if the
disclosure of such Confidential Information to such other holder was made
subject to this Section 20, or
(d) constitutes financial statements delivered to you under Section
7.1 that are otherwise publicly available.
You will maintain the confidentiality of such Confidential Information in
accordance with procedures adopted by you in good faith to protect confidential
information of third parties delivered to you, provided that you may deliver or
disclose Confidential Information to
(i) your directors, officers, employees, agents, attorneys and
affiliates (to the extent such disclosure reasonably relates to the
administration of the investment represented by your Notes),
(ii) your financial advisors and other professional advisors who
agree to hold confidential the Confidential Information substantially
in accordance with the terms of this Section 20,
(iii) any other holder of any Note,
(iv) any Institutional Investor to which you sell or offer to
sell such Note or any part thereof or any participation therein (if
such Person has agreed in writing prior to its receipt of such
Confidential Information to be bound by the provisions of this Section
20),
(v) any Person from which you offer to purchase any Security of
the Company (if such Person has agreed in writing prior to its receipt
of such Confidential Information to be bound by the provisions of this
Section 20),
(vi) any federal or state regulatory authority having
jurisdiction over you,
(vii) the National Association of Insurance Commissioners or any
similar organization, or any nationally recognized rating agency that
requires access to information about your investment portfolio, or
(viii) any other Person to which such delivery or disclosure may
be necessary or appropriate (w) to effect compliance with any law,
rule, regulation or order applicable to you, (x) in response to any
subpoena or other legal process, (y) in connection with any litigation
to which you are a party or (z) if an Event of Default has occurred
and is continuing, to the extent you may reasonably determine such
delivery and disclosure to be necessary or appropriate in the
enforcement or for the protection of the rights and remedies under
your Notes and this Agreement.
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Each holder of a Note, by its acceptance of a Note, will be deemed to have
agreed to be bound by and to be entitled to the benefits of this Section 20 as
though it were a party to this Agreement. On reasonable request by the Company
in connection with the delivery to any holder of a Note of information required
to be delivered to such holder under this Agreement or requested by such holder
(other than a holder that is a party to this Agreement or its nominee), such
holder will enter into an agreement with the Company embodying the provisions of
this Section 20.
21. SUBSTITUTION OF PURCHASER.
You shall have the right to substitute any one of your Affiliates as
the purchaser of the Notes that you have agreed to purchase hereunder, by
written notice to the Company, which notice shall be signed by both you and such
Affiliate, shall contain such Affiliate's agreement to be bound by this
Agreement and shall contain a confirmation by such Affiliate of the accuracy
with respect to it of the representations set forth in Section 6. Upon receipt
of such notice, wherever the word "you" is used in this Agreement (other than in
this Section 21), such word shall be deemed to refer to such Affiliate in lieu
of you. In the event that such Affiliate is so substituted as a purchaser
hereunder and such Affiliate thereafter transfers to you all of the Notes then
held by such Affiliate, upon receipt by the Company of notice of such transfer,
wherever the word "you" is used in this Agreement (other than in this Section
21), such word shall no longer be deemed to refer to such Affiliate, but shall
refer to you, and you shall have all the rights of an original holder of the
Notes under this Agreement.
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22. MISCELLANEOUS.
22.1 Successors and Assigns.
All covenants and other agreements contained in this Agreement by or on
behalf of any of the parties hereto bind and inure to the benefit of their
respective successors and assigns (including, without limitation, any subsequent
holder of a Note) whether so expressed or not.
22.2 Payments Due on Non-Business Days; When Payments Deemed
Received.
(a) Payments Due on Non-Business Days. Anything in this
Agreement or the Notes to the contrary notwithstanding, any payment of
principal of or Make-Whole Amount or interest on any Note that is due
on a date other than a Business Day shall be made on the next
succeeding Business Day without including the additional days elapsed
in the computation of the interest payable on such next succeeding
Business Day.
(b) Payments, When Received. Any payment to be made to the
holders of Notes hereunder or under the Notes shall be deemed to have
been made on the Business Day such payment actually becomes available
to such holder at such holder's bank prior to 12:00 noon (local time of
such bank).
22.3 Severability.
Any provision of this Agreement that is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall (to the full extent permitted by law) not invalidate or
render unenforceable such provision in any other jurisdiction.
22.4 Construction.
Each covenant contained herein shall be construed (absent express
provision to the contrary or where the context clearly would indicate otherwise)
as being independent of each other covenant contained herein, so that compliance
with any one covenant shall not (absent such an express contrary provision or
where the context clearly would indicate otherwise) be deemed to excuse
compliance with any other covenant. Where any provision herein refers to action
to be taken by any Person, or which such Person is prohibited from taking, such
provision shall be applicable whether such action is taken directly or
indirectly by such Person.
22.5 Counterparts.
This Agreement may be executed in any number of counterparts, each of
which shall be an original but all of which together shall constitute one
instrument. Each counterpart may consist of a number of copies hereof, each
signed by less than all, but together signed by all, of the parties hereto.
22.6 Governing Law.
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THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND
THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE OF NEW YORK
EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE
THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE.
[Remainder of page intentionally blank. Next page is signature page.]
84
If you are in agreement with the foregoing, please sign the form of
agreement on the accompanying counterpart of this Agreement and return it to the
Company, whereupon the foregoing shall become a binding agreement between you
and the Company.
Very truly yours,
NFO Worldwide, Inc.
By:_________________________
Name:
Title:
The foregoing is hereby
agreed to as of the
date thereof.
[Purchaser]
By:_________________________
Name:
Title:
85
