EXHIBIT 2.9
EXECUTION COPY
THL BUILDCO, INC.
A DELAWARE CORPORATION THAT WILL BE
MERGED ULTIMATELY WITH AND INTO
NORTEK, INC.
$625,000,000 8 1/2% SENIOR SUBORDINATED NOTES DUE 2014
PURCHASE AGREEMENT
August 12, ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
UBS Securities LLC
Credit Suisse First Boston LLC
Banc of America Securities LLC
Bear, ▇▇▇▇▇▇▇ & Co. Inc.
Sovereign Securities Corporation, LLC
c/o UBS Securities LLC
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
THL Buildco, Inc., a Delaware corporation (the "INITIAL ISSUER"),
agrees with you as follows:
1. Issuance of Notes. The Initial Issuer proposes, subject to and
upon the terms and conditions set forth below, to issue and sell to UBS
Securities LLC (the "REPRESENTATIVE") and the several parties named on Schedule
I hereto (together with the Representative, the "INITIAL PURCHASERS")
$625,000,000 aggregate principal amount of 8 1/2% Senior Subordinated Notes due
2014 (the "ORIGINAL NOTES").
As part of the Transactions (as defined below), which are more fully
described under the heading "The Transactions" in the Offering Memorandum (as
defined below), the Original Notes are being offered and sold by the Initial
Issuer in connection with the purchase (the "STOCK PURCHASE") by the Initial
Issuer of all of the capital stock of Nortek Holdings, Inc., a Delaware
corporation ("PARENT"), pursuant to that certain Stock Purchase Agreement, dated
as of July 15, 2004, by and among ▇▇▇▇▇ Investment Associates VI, L.P., the
other sellers named therein, THL Buildco Holdings, Inc. and the Initial Issuer
(as amended, the "STOCK PURCHASE AGREEMENT"). On the date hereof, Parent is the
sole stockholder of Nortek, Inc., a Delaware corporation (the "COMPANY"). On the
Closing Date (as defined below), immediately following the issuance and sale of
the Original Notes to the Initial Purchasers and the Stock Purchase, the Initial
Issuer will be merged (the "FIRST MERGER") with and
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into Parent, with Parent continuing as the surviving corporation of the First
Merger, and, immediately following the First Merger, Parent will be merged (the
"SECOND MERGER") with and into the Company, with the Company continuing as the
surviving corporation (the "SURVIVING CORPORATION") of the Second Merger (the
First Merger and the Second Merger being collectively referred to herein as the
"MERGERS" and, together with the Stock Purchase, as the "ACQUISITION"; and the
agreements and other documents governing the Mergers, together with the Stock
Purchase Agreement, being collectively referred to herein, as the "ACQUISITION
DOCUMENTS"). In addition, on the Closing Date and in connection with the
Acquisition, (i) an investor group led by affiliates of ▇▇▇▇▇▇ ▇. ▇▇▇ Partners,
L.P. will make cash equity investments in entities that will beneficially own,
after the Acquisition, all of the capital stock of the Surviving Corporation
(the "EQUITY FINANCING"), (ii) the Initial Issuer will enter into a new
$800,000,000 senior secured credit facility (together with all other documents
related to such facility, the "CREDIT DOCUMENTS") with UBS AG, Stamford Branch,
as administrative agent, and the lenders party thereto and (iii) notes
representing certain existing indebtedness of Parent and the Company will have
been accepted for purchase in tender offers of Parent and the Company, as
applicable, relating to such notes (the "REFINANCING"), all as more fully
described in the Offering Memorandum.
On the Closing Date, immediately after giving effect to the
Acquisition, the Surviving Corporation shall execute and deliver a joinder
agreement (the "JOINDER AGREEMENT") substantially in the form of Exhibit C
hereto, and each of the subsidiaries of the Company listed on Schedule II hereto
(collectively, the "GUARANTORS") shall become parties hereto by executing and
delivering the Joinder Agreement. In addition, on the Closing Date, immediately
after giving effect to the Acquisition, (i) the Surviving Corporation will
execute the Original Notes and each of the Guarantors will execute a notation of
guarantee set forth thereon and (ii) the Initial Issuer, the Surviving
Corporation and the Guarantors will execute and deliver the Indenture (as
defined below) and the Registration Rights Agreement (as defined below). Upon
execution and delivery of the Original Notes and the Indenture by the
Guarantors, the Surviving Corporation's obligations under the Original Notes and
the Indenture will be, jointly and severally, unconditionally guaranteed (the
"ORIGINAL GUARANTEES"), on an unsecured senior subordinated basis, by each of
the Guarantors.
References herein to the "ISSUERS" refer (i) prior to the
Acquisition, solely to the Initial Issuer and (ii) following the Acquisition, to
the Surviving Corporation and the Guarantors.
The Securities (as defined below) will be offered and sold to the
Initial Purchasers pursuant to an exemption from the registration requirements
under the Securities Act of 1933, as amended (the "ACT"). The Initial Issuer has
prepared a preliminary offering memorandum, dated as of August 5, 2004 (as
amended or supplemented at the date hereof, including all exhibits thereto and
all documents incorporated by reference therein which have been prepared by
Parent and filed with the Securities and Exchange Commission (the "COMMISSION")
at the date hereof, the "PRELIMINARY OFFERING MEMORANDUM"), and a final offering
memorandum dated as of and available for distribution on the date hereof (as
amended or supplemented at the date hereof, including any and all exhibits
thereto and all documents incorporated by reference therein which have been
prepared by Parent and filed with the Commission at the date hereof, the
"OFFERING MEMORANDUM"), each relating to the Company, Parent, the Initial
Issuer, the Surviving Corporation and the Guarantors, the offering of the
Securities and the Securities.
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Subject to the foregoing paragraph, any references herein to the
terms "AMEND," "AMENDMENT" or "SUPPLEMENT" with respect to the Offering
Memorandum shall be deemed to refer to and include any document filed under the
Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), subsequent to
the date hereof that is incorporated by reference therein; and all references in
this Agreement to financial statements and schedules and other information which
are "CONTAINED," "INCLUDED," "STATED" or "DESCRIBED" in the Offering Memorandum
(or other references of like import) shall be deemed to mean and include all
such financial statements and schedules and other information which are included
in any document filed under the Exchange Act and incorporated by reference in
the Offering Memorandum.
The Initial Purchasers have advised the Initial Issuer and the
Company that the Initial Purchasers intend, as soon as they deem practicable
after this Purchase Agreement (this "AGREEMENT") has been executed and
delivered, to resell (the "EXEMPT RESALES") the Securities in private sales
exempt from registration under the Act on the terms set forth in the Offering
Memorandum, as amended or supplemented, solely to (i) persons whom the Initial
Purchasers reasonably believe to be "qualified institutional buyers" ("QIBS"),
as defined in Rule 144A under the Act ("RULE 144A"), in accordance with Rule
144A and (ii) other eligible purchasers pursuant to offers and sales that occur
outside the United States within the meaning of Regulation S under the Act
("REGULATION S") in accordance with Regulation S (the persons specified in
clauses (i) and (ii), the "ELIGIBLE PURCHASERS").
Holders (including subsequent transferees) of the Securities will
have the registration rights under the registration rights agreement (the
"REGISTRATION RIGHTS AGREEMENT"), among the Issuers and the Initial Purchasers,
to be dated the Closing Date, substantially in the form attached hereto as
Exhibit A. Under the Registration Rights Agreement, the Issuers will agree to
(i) file with the Securities and Exchange Commission (the "COMMISSION") (a) a
registration statement under the Act (the "EXCHANGE OFFER REGISTRATION
STATEMENT") relating to a new issue of debt securities (collectively with the
Private Exchange Notes (as defined in the Registration Rights Agreement), the
"EXCHANGE NOTES" and, together with the Original Notes, the "NOTES"), guaranteed
by the guarantors under the Indenture (the "EXCHANGE GUARANTEES" and, together
with the Original Guarantees, the "GUARANTEES"), to be offered in exchange for
the Original Notes and the Original Guarantees (the "EXCHANGE OFFER") and issued
under the Indenture or an indenture substantially identical to the Indenture
and/or (b) under certain circumstances set forth in the Registration Rights
Agreement, a shelf registration statement pursuant to Rule 415 under the Act
(the "SHELF REGISTRATION STATEMENT") relating to the resale by certain holders
of the Original Notes and the Original Guarantees, (ii) to use its reasonable
best efforts to cause the Exchange Offer Registration Statement and, if
applicable, the Shelf Registration Statement to be declared effective and (iii)
to use their reasonable best efforts to consummate the Exchange Offer, all
within the time periods specified in the Registration Rights Agreement.
References herein to the "SECURITIES" refer (i) prior to the
Acquisition, solely to the Notes, and (ii) upon the consummation of the
Acquisition and after giving effect thereto, to the Notes and the Guarantees.
The Securities will be issued pursuant to an indenture (the "INDENTURE"), to be
dated the Closing Date (as defined herein), among the Issuers and U.S. Bank
National Association, as trustee (the "TRUSTEE").
This Agreement, the Notes, the Guarantees, the Indenture, the
Registration Rights Agreement and the Joinder Agreement are hereinafter
sometimes referred to collectively as the "NOTE
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DOCUMENTS." The Note Documents, the Acquisition Documents and the Credit
Documents are hereinafter sometimes referred to collectively as the "TRANSACTION
DOCUMENTS." The issuance and sale of the Securities, the Acquisition, the Equity
Financing, the effectiveness of the Credit Documents and the initial borrowings
thereunder and the Refinancing are collectively referred to as the
"TRANSACTIONS."
2. Agreements to Sell and Purchase. On the basis of the
representations, warranties and covenants contained in this Agreement, and
subject to the terms and conditions contained in this Agreement, the Initial
Issuer agrees to issue and sell to the Initial Purchasers, and each of the
Initial Purchasers, severally and not jointly, agrees to purchase from the
Initial Issuer, the aggregate principal amount of Original Notes set forth
opposite its name on Schedule I attached hereto. The purchase price for the
Original Notes shall be 97.25% of their principal amount.
3. Delivery and Payment. Payment of the purchase price for the
Original Notes and the Original Guarantees shall be made at 9:00 a.m., New York
time, on August 27, 2004 (such date, the "CLOSING DATE") at the offices of Ropes
& ▇▇▇▇ LLP, ▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, against delivery
thereof on the Closing Date. The Closing Date and the location of delivery of
and the form of payment for the Original Notes and the Original Guarantees may
be varied by mutual agreement between the Initial Purchasers and the Initial
Issuer.
The Original Notes and the Original Guarantees shall be delivered by
the Issuers to the Initial Purchasers (or as the Initial Purchasers direct)
through the facilities of The Depository Trust Company against payment by the
Initial Purchasers of the purchase price therefor by means of wire transfer of
immediately available funds to such account or accounts specified by the Initial
Issuer in accordance with Section 8(h) on or prior to the Closing Date, or by
such means as the parties hereto shall agree prior to the Closing Date. The
Original Notes and the Original Guarantees shall be evidenced by one or more
certificates in global form registered in such names as the Initial Purchasers
may request upon at least one business day's notice prior to the Closing Date
and having an aggregate principal amount corresponding to the aggregate
principal amount of the Original Notes and the Original Guarantees.
4. Agreements of the Issuers. The Initial Issuer, prior to the
Acquisition, and the Surviving Corporation and the Guarantors, jointly and
severally, following the consummation of the Acquisition, covenant and agree
with the Initial Purchasers as follows:
(a) To furnish the Initial Purchasers and those persons identified
by the Initial Purchasers, without charge, with as many copies of the
Preliminary Offering Memorandum and the Offering Memorandum, and any
amendments or supplements thereto, as the Initial Purchasers may
reasonably request. The Issuers consent to the use of the Preliminary
Offering Memorandum and the Offering Memorandum, and any amendments and
supplements thereto, by the Initial Purchasers in connection with Exempt
Resales.
(b) Not to make any changes or additions to the information
contained in the Offering Memorandum from the corresponding information
contained in the Preliminary Offering Memorandum other than (i) changes
and additions to reflect pricing information with respect to the
Securities and (ii) such other changes and additions as to which the
Representative
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shall have consented (such consent not to be unreasonably withheld or
delayed). Not to amend or supplement the Offering Memorandum prior to the
Closing Date unless (i) the Initial Purchasers shall previously have been
advised of such proposed amendment or supplement at least two business
days prior to the proposed use and (ii) shall not have objected to, or
shall have consented to (such consent not to be unreasonably withheld or
delayed), such amendment or supplement.
(c) If, prior to the time that the Initial Purchasers have completed
their distribution of the Securities, any event shall occur and, as a
result thereof, in the judgment of the Issuers or in the judgment of
counsel to the Initial Purchasers, the Offering Memorandum, as then
amended or supplemented, would include any untrue statement of a material
fact or omit to state a material fact necessary in order to make the
statements in the Offering Memorandum, as then amended or supplemented, in
the light of the circumstances under which they are made, not misleading,
or if it is necessary to amend or supplement the Offering Memorandum to
comply with all applicable laws, the Issuers shall promptly notify the
Initial Purchasers of such event and (subject to Section 4(b)) prepare an
appropriate amendment or supplement to the Offering Memorandum so that (i)
the statements in the Offering Memorandum, as amended or supplemented,
will not contain any untrue statement of a material fact or omit to state
any material fact necessary in order to make the statements therein, in
the light of the circumstances at the time that the Offering Memorandum is
delivered to prospective Eligible Purchasers, not misleading and (ii) the
Offering Memorandum will comply with applicable law.
(d) To qualify or register the Securities under the securities laws
of such jurisdictions as the Initial Purchasers may request and to
continue such qualification in effect so long as required for the Exempt
Resales. Notwithstanding the foregoing, no Issuer shall be required to
qualify as a foreign corporation in any jurisdiction in which it is not so
qualified or to execute a general consent to service of process in any
such jurisdiction or subject itself to taxation in excess of a nominal
dollar amount in any such jurisdiction where it is not then so subject.
(e) To advise the Initial Purchasers promptly and, if requested by
the Initial Purchasers, to confirm such advice in writing, of the issuance
by any securities commission of any stop order suspending the
qualification or exemption from qualification of any of the Securities for
offering or sale in any jurisdiction, or the initiation of any proceeding
for such purpose by any securities commission or other regulatory
authority. The Issuers shall use their reasonable best efforts to prevent
the issuance of any stop order or order suspending the qualification or
exemption of any of the Securities under any securities laws, and, if at
any time any securities commission or other regulatory authority shall
issue an order suspending the qualification or exemption of any of the
Securities under any securities laws, the Issuers shall use their
reasonable best efforts to obtain the withdrawal or lifting of such order
at the earliest possible time.
(f) Whether or not the transactions contemplated by this Agreement
are consummated, to pay all costs, expenses, fees and disbursements
(including fees and disbursements of counsel and accountants for the
Issuers) incurred in connection with the performance
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of the obligations of the Issuers under this Agreement and all stamp,
documentary or similar taxes incident to and in connection therewith,
including, those relating to: (i) the preparation, printing and
distribution of the Preliminary Offering Memorandum and the Offering
Memorandum and any amendments and supplements thereto, (ii) all expenses
(including travel expenses) of the Issuers in connection with any meetings
with prospective investors in the Securities (including rental costs of
airplanes used to transport representatives of the Initial Issuer, the
Company and the Initial Purchasers to such meetings), (iii) the
preparation (except to the extent prepared by counsel to the Initial
Purchasers), notarization (if necessary) and delivery of the Note
Documents and all other agreements, memoranda, correspondence and
documents prepared and delivered in connection with this Agreement and
with the Exempt Resales, (iv) the issuance, transfer and delivery of the
Securities by the Issuers to the Initial Purchasers, (v) the qualification
or registration of the Securities for offer and sale under the securities
laws of the several states of the United States or provinces of Canada
(including, without limitation, the cost of printing and mailing
preliminary and final Blue Sky or legal investment memoranda and
reasonable fees and disbursements of counsel (including local counsel) to
the Initial Purchasers relating thereto), (vi) the application for
quotation of the Securities in The PORTAL(SM) Market ("PORTAL") of the
National Association of Securities Dealers, Inc. ("NASD"), (vii) the
inclusion of the Securities in the book-entry system of The Depository
Trust Company ("DTC"), (viii) the rating of the Securities by rating
agencies, (ix) the fees and expenses of the Trustee and its counsel and
(x) the performance by the Issuers of their other obligations under the
Note Documents. Except as specifically provided in this Section 4(f), the
Initial Purchasers shall pay all of their own expenses (including all of
the fees and disbursements of counsel) in connection with the preparation
of this Agreement and the other Note Documents, the transactions
contemplated hereby and thereby and all Exempt Resales.
(g) To use the net proceeds from the sale of the Original Notes, the
Equity Financing and initial borrowings under the Credit Agreement in the
manner described in the Offering Memorandum under the caption "Use of
proceeds."
(h) Not to, and not to permit any of the Company's or the Surviving
Corporation's subsidiaries listed on Schedule III attached hereto (each, a
"SUBSIDIARY" and collectively, the "SUBSIDIARIES") to, sell, offer for
sale or solicit offers to buy any security (as defined in the Act) that
would be integrated with the sale of the Securities in a manner that would
require the registration under the Act of the sale of the Securities to
the Initial Purchasers or any Eligible Purchasers.
(i) During the period of two years immediately following the Closing
Date, not to, and to cause their respective controlled "affiliates" (as
defined in Rule 144 under the Act), Parent and THL Buildco Holdings, Inc.
(which after the Mergers will be renamed "Nortek Holdings, Inc." and
become the new parent of the Surviving Corporation) not to, resell any of
the Securities that constitute "restricted securities" under Rule 144 that
have been reacquired by any of them (other than in a transaction
registered under the Act).
(j) Not to engage, and to cause the Subsidiaries and their other
respective controlled affiliates, Parent and THL Buildco Holdings, Inc. or
any person acting on their behalf (other than, in any case, the Initial
Purchasers and any of their controlled affiliates, Parent and
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THL Buildco Holdings, Inc., as to whom the Issuers make no covenant) not
to engage, in any form of general solicitation or general advertising
(within the meaning of Regulation D under the Act) in connection with any
offer or sale of the Securities in the United States.
(k) Not to engage, and to cause the Subsidiaries and their other
respective controlled affiliates, Parent and THL Buildco Holdings, Inc. or
any person acting on their behalf (other than, in any case, the Initial
Purchasers and any of their controlled affiliates, Parent and THL Buildco
Holdings, Inc., as to whom the Issuers make no covenant) not to engage, in
any directed selling effort with respect to the Securities, and to comply
with the offering restrictions requirement of Regulation S. Terms used in
this paragraph have the meanings given to them by Regulation S.
(l) From and after the Closing Date, for so long as any of the
Securities remain outstanding and are "restricted securities" within the
meaning of Rule 144(a)(3) under the Act and during any period in which the
Surviving Corporation is not subject to Section 13 or 15(d) of the
Exchange Act, to make available upon request the information required by
Rule 144A(d)(4) under the Act to (i) any holder or beneficial owner of
Securities in connection with any sale of such Securities and (ii) any
prospective purchaser of such Securities from any such holder or
beneficial owner designated by the holder or beneficial owner. The
Surviving Corporation will pay the reasonable expenses of preparing,
printing and distributing such documents.
(m) To comply with their obligations under the Registration Rights
Agreement.
(n) To comply with their obligations under the letter of
representations to DTC relating to the approval of the Securities by DTC
for "book-entry" transfer and to use their reasonable best efforts to
obtain approval of the Securities by DTC for "book-entry" transfer.
(o) Prior to the Closing Date, to furnish without charge to the
Initial Purchasers, (i) as soon as they have been prepared by the Company
and furnished to the Initial Issuer, a copy of any regularly prepared
internal financial statements of the Company and the Subsidiaries for any
period subsequent to the period covered by the financial statements
appearing in the Offering Memorandum that are furnished to the Initial
Issuer, (ii) as soon as they have been furnished to the Initial Issuer,
all other reports and other communications (financial or otherwise) that
the Company mails or otherwise makes available to its security holders and
(iii) such other information as the Initial Purchasers shall reasonably
request.
(p) Not to, and to cause any of their respective controlled
affiliates, Parent and THL Buildco Holdings, Inc. or anyone acting on
their or such person's behalf (other than the Initial Purchasers and their
affiliates) not to, distribute prior to the Closing Date any offering
material in connection with the offer and sale of the Securities other
than the Preliminary Offering Memorandum and the Offering Memorandum.
(q) During the period of two years after the Closing Date or, if
earlier, until such time as the Securities are no longer restricted
securities (as defined in Rule 144 under the Act),
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not to be or become a closed-end investment company required to be
registered, but not registered, under the Investment Company Act of 1940.
(r) In connection with the offering, until the Initial Purchasers
shall have notified the Surviving Corporation of the completion of the
distribution of the Securities, not to, and to cause any of its controlled
"affiliates" (as such term is defined in Rule 501(b) of Regulation D under
the Act) and THL Buildco Holdings, Inc. not to, either alone or with one
or more other persons, bid for or purchase for any account in which it or
any of its affiliates has a beneficial interest, for the purpose of
creating actual or apparent active trading in, or of raising the price of,
the Securities.
(s) To use their reasonable best efforts to effect the inclusion of
the Securities in Portal.
(t) During the period from the date hereof through and including the
date that is 90 days after the date hereof, without the prior written
consent of the Representative, offer, sell, contract to sell or otherwise
dispose of any debt securities issued or guaranteed by the Company, the
Initial Issuer, Parent, THL Buildco Holdings, Inc., the Surviving
Corporation or any Subsidiary and having a tenor of more than one year,
other than debt instruments issued to sellers of property, capital lease
obligations, and credit facilities used for working capital or to finance
acquisitions.
5. Representations and Warranties. (a) The Issuers represent and
warrant to the Initial Purchasers that:
(i) Neither (a) the Preliminary Offering Memorandum as of the date
thereof nor (b) the Offering Memorandum as of the date thereof and the
Closing Date nor (c) any amendment or supplement thereto as of the date
thereof and the Closing Date contained or will contain any untrue
statement of a material fact or omitted or will omit to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except that the
representations and warranties set forth in this Section 5(i) do not apply
to statements or omissions made in reliance upon and in conformity with
information relating to any of the Initial Purchasers furnished to the
Initial Issuer, the Company or Parent in writing by the Initial Purchasers
expressly for use in the Preliminary Offering Memorandum, the Offering
Memorandum or any amendment or supplement thereto.
(ii) The documents incorporated or deemed to be incorporated by
reference in the Preliminary Offering Memorandum or the Offering
Memorandum, at the time they were or hereafter are filed with the
Commission, complied and will comply in all material respects with the
requirements of the Exchange Act and the rules and regulations of the
Commission thereunder.
(iii) As of the Closing Date, after giving effect to the
Transactions, the capitalization of the Surviving Corporation shall be as
set forth in the Offering Memorandum under the heading "Capitalization";
all of the subsidiaries of the Company are listed on Schedule III
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attached hereto; all of the outstanding shares of capital stock of the
Company and the Subsidiaries have been, and as of the Closing Date will
be, duly authorized and validly issued, are fully paid and nonassessable
and were not issued in violation of any preemptive or similar rights;
except for security interests granted pursuant to the Credit Documents,
all of the outstanding shares of capital stock of the Company and of each
of the Subsidiaries are and will be as of the Closing Date free and clear
of all liens, encumbrances, equities and claims or restrictions on
transferability (other than those imposed by the Act, the securities or
"Blue Sky" laws of certain jurisdictions) or voting; except as set forth
in the Offering Memorandum, there are no (a) options, warrants or other
rights to purchase, (b) agreements or other obligations to issue or (c)
other rights to convert any obligation into, or exchange any securities
for, shares of capital stock of or ownership interests in the Company or
any of the Subsidiaries outstanding. Except for the Subsidiaries, as
disclosed in the Offering Memorandum or as set forth on Schedule IV
attached hereto, the Company does not own, directly or indirectly, more
than 5% of the outstanding capital stock or other equity interests in any
firm, partnership, joint venture or other entity.
(iv) Each of the Initial Issuer, the Company and the Subsidiaries
is, and the Surviving Corporation shall be on the Closing Date, duly
organized, validly existing and in good standing under the laws of its
respective jurisdiction of incorporation, and each of the Initial Issuer,
the Company and the Subsidiaries has, and the Surviving Company shall have
on the Closing Date, all requisite corporate, limited liability company or
partnership, as applicable, power and authority to own its properties and
conduct its business as now conducted and as described in the Offering
Memorandum; each of the Company and the Subsidiaries is, and the Surviving
Corporation shall be on the Closing Date, duly qualified to do business as
a foreign corporation, limited liability company or partnership, as
applicable, in good standing, where applicable, in all other jurisdictions
where the ownership or leasing of its properties or the conduct of its
business requires such qualification, except where the failure to be so
qualified would not, individually or in the aggregate, have a material
adverse effect on the general affairs, management, business, condition
(financial or otherwise), prospects or results of operations of the
Company or the Surviving Corporation, as the case may be, and the
Subsidiaries, taken as a whole (any such event, a "MATERIAL ADVERSE
EFFECT").
(v) The Initial Issuer has all requisite corporate power and
authority to execute, deliver and perform each of its obligations under
the Original Notes, the Exchange Notes and the Private Exchange Notes. On
the Closing Date, the Surviving Corporation will have all requisite
corporate power and authority to execute, deliver and perform each of its
obligations under the Original Notes, the Exchange Notes and the Private
Exchange Notes. The Notes, when issued, will be in the form contemplated
by the Indenture. The Original Notes, the Exchange Notes and the Private
Exchange Notes each have been duly and validly authorized by the Initial
Issuer and, on the Closing Date, will have been duly and validly
authorized by the Surviving Corporation. When executed by the Initial
Issuer and authenticated by the Trustee in accordance with the provisions
of the Indenture, and, in the case of the Original Notes, when delivered
to and paid for by the Initial Purchasers in accordance with the terms of
this Agreement, the Original Notes, the Exchange Notes and the Private
Exchange Notes, will constitute valid and legally binding obligations of
the Initial Issuer, entitled to the benefits of the Indenture, and
enforceable against the Initial Issuer in accordance with their terms,
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except that the enforcement thereof may be subject to (a) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally, and (b)
general principles of equity and the discretion of the court before which
any proceeding therefor may be brought (the "BANKRUPTCY EXCEPTIONS"). On
the Closing Date, upon consummation of the Mergers, the Original Notes
will, and the Exchange Notes and the Private Exchange Notes will when
executed by the Initial Issuer and authenticated by the Trustee in
accordance with the provisions of the Indenture, constitute valid and
legally binding obligations of the Surviving Corporation, entitled to the
benefits of the Indenture, and enforceable against the Surviving
Corporation in accordance with their terms, except that the enforcement
thereof may be subject to the Bankruptcy Exceptions.
(vi) On the Closing Date, each of the Guarantors will have all
requisite corporate, limited liability company or partnership, as
applicable, power and authority to execute, deliver and perform each of
its obligations under the Original Guarantees and the Exchange Guarantees.
The Guarantees, when issued, will be in the form contemplated by the
Indenture. On the Closing Date, the Original Guarantees and the Exchange
Guarantees will have been duly and validly authorized by each of the
Guarantors and, assuming that the Original Notes are issued, authenticated
by the Trustee and delivered by the Initial Issuer against payment by the
Initial Purchasers in accordance with the terms of this Agreement and the
Indenture and assumed by the Surviving Corporation, will be legally
binding and valid obligations of the Guarantors, enforceable against each
of them in accordance with their terms, except that enforceability thereof
may be limited by the Bankruptcy Exceptions. On the Closing Date, the
Exchange Guarantees will have been duly and validly authorized by each of
the Guarantors and, when the Exchange Notes are issued, authenticated by
the Trustee and delivered in accordance with the terms of the Registration
Rights Agreement, the Exchange Offer and the Indenture, will be legally
binding and valid obligations of the Guarantors, enforceable against each
of them in accordance with their terms, except that the enforceability
thereof may be limited by the Bankruptcy Exceptions.
(vii) The Initial Issuer has all requisite corporate power and
authority to execute, deliver and perform its obligations under the
Indenture. On the Closing Date, the Surviving Corporation and each of the
Guarantors will have all requisite corporate power and authority to
execute, deliver and perform their respective obligations under the
Indenture. The Indenture will meet the requirements for qualification
under the Trust Indenture Act of 1939, as amended (the "TIA"). On the
Closing Date, the Indenture will have been duly and validly authorized by
the Initial Issuer, the Surviving Corporation and the Guarantors and, when
executed and delivered by the Initial Issuer, the Surviving Corporation
and the Guarantors (assuming the due authorization, execution and delivery
by the Trustee), will constitute a valid and legally binding agreement of
the Initial Issuer or the Surviving Corporation, as the case may be, and
the Guarantors, enforceable against the Initial Issuer or the Surviving
Corporation, as the case may be, and the Guarantors in accordance with its
terms, except that the enforceability thereof may be limited by the
Bankruptcy Exceptions.
(viii) The Initial Issuer has all requisite corporate power and
authority to execute, deliver and perform its obligations under the
Registration Rights Agreement. On the Closing Date, the Surviving
Corporation and the Guarantors will have all requisite corporate, limited
- 11 -
liability company or partnership, as applicable, power and authority to
execute, deliver and perform their respective obligations under the
Registration Rights Agreement. The Registration Rights Agreement has been
duly and validly authorized by the Initial Issuer, and on the Closing Date
will have been duly and validly authorized by the Surviving Corporation
and the Guarantors. When executed and delivered by the Issuers (assuming
the due authorization, execution and delivery by the Initial Purchasers),
the Registration Rights Agreement will constitute a valid and legally
binding agreement of the Issuers enforceable against the Issuers in
accordance with its terms, except that (A) the enforcement thereof may be
subject to the Bankruptcy Exceptions and (B) any rights to indemnity or
contribution thereunder may be limited by federal and state securities
laws and public policy considerations.
(ix) The Initial Issuer has all requisite corporate power and
authority to execute, deliver and perform its obligations under this
Agreement and to consummate the transactions contemplated hereby. On the
Closing Date, the Surviving Corporation and the Guarantors will have all
requisite corporate, limited liability company or partnership, as
applicable, power and authority to execute, deliver and perform their
respective obligations under this Agreement and to consummate the
transactions contemplated hereby. This Agreement and the consummation by
the Initial Issuer of the transactions contemplated hereby have been duly
and validly authorized by the Initial Issuer. On the Closing Date, this
Agreement and the consummation by the Surviving Corporation and the
Guarantors of the transactions contemplated hereby will have been duly and
validly authorized by the Surviving Corporation and the Guarantors. This
Agreement has been duly executed and delivered by the Initial Issuer and,
on the Closing Date, the Joinder Agreement will have been duly executed
and delivered by the Surviving Corporation and the Guarantors.
(x) No consent, approval, authorization or order of any court or
governmental agency or body, or third party is required for the issuance
and sale by the Issuers of the Securities to the Initial Purchasers or the
consummation by Parent or the Issuers of the other transactions
contemplated hereby, except such as have been obtained or will be obtained
prior to the Closing Date and such as may be required under state
securities or "Blue Sky" laws in connection with the purchase and resale
of the Securities by the Initial Purchasers. None of Parent, the Initial
Issuer, the Company, the Surviving Corporation or the Subsidiaries is or
will be on the Closing Date (a) in violation of its certificate of
incorporation or bylaws (or similar organizational document), (b) in
breach or violation of any statute, judgment, decree, order, rule or
regulation applicable to any of them or any of their respective properties
or assets, except for any such breach or violation that would not,
individually or in the aggregate, have a Material Adverse Effect, or (c)
in breach of or default under (nor has any event occurred that, with
notice or passage of time or both, would constitute a default under) or in
violation of any of the terms or provisions of any indenture, mortgage,
deed of trust, loan agreement, note, lease, license, franchise agreement,
permit, certificate, contract or other agreement or instrument to which
any of them is a party or to which any of them or their respective
properties or assets is subject (collectively, "CONTRACTS"), except for
any such breach, default, violation or event that would not, individually
or in the aggregate, have a Material Adverse Effect.
- 12 -
(xi) The execution, delivery and performance by the Issuers of this
Agreement, the Indenture and the Registration Rights Agreement and the
consummation by the Issuers of the transactions contemplated hereby and
thereby (including, without limitation, the issuance and sale of the
Securities to the Initial Purchasers) will not conflict with or constitute
or result in a breach of or a default under (or an event that with notice
or passage of time or both would constitute a default under) or violation
of any of (a) the terms or provisions of any Contract, except for any such
conflict, breach, violation, default or event that would not, individually
or in the aggregate, have a Material Adverse Effect, (b) the certificate
of incorporation or bylaws (or similar organizational document) of the
Initial Issuer, the Company, the Surviving Corporation or any of the
Subsidiaries or (c) (assuming compliance with all applicable state
securities or "Blue Sky" laws and assuming the accuracy of the
representations and warranties of the Initial Purchasers in Section 5(b)
hereof) any statute, judgment, decree, order, rule or regulation
applicable to the Initial Issuer, the Company, the Surviving Corporation
or any of the Subsidiaries or any of their respective properties or
assets, except for any such conflict, breach or violation that would not,
individually or in the aggregate, have a Material Adverse Effect.
(xii) The historical consolidated financial statements (including
the notes thereto) of Parent and its subsidiaries included or incorporated
by reference in the Offering Memorandum present fairly in all material
respects the consolidated financial position, results of operations, cash
flows and changes in stockholder's investment of Parent at the respective
dates and for the respective periods indicated. All such financial
statements have been prepared in accordance with generally accepted
accounting principles ("GAAP") applied on a consistent basis throughout
the periods presented (except as disclosed therein)., except that the
interim financial statements do not include full footnote disclosure. The
summary financial and statistical data in the Offering Memorandum present
fairly in all material respects the information shown therein and have
been prepared and compiled on a basis consistent with the audited
financial statements included therein, except as otherwise stated therein.
(xiii) The unaudited pro forma financial statements (including the
notes thereto) (other than, with respect to the following clauses (A) and
(B) only, the pro forma statement of operations data for the twelve months
ended July 3, 2004) (A) comply as to form in all material respects with
the applicable requirements of Regulation S-X promulgated under the
Exchange Act, (B) have been prepared in accordance with the Commission's
rules and guidelines with respect to pro forma financial statements and
(C) have been properly computed on the bases described therein. The
assumptions used in the preparation of the pro forma financial statements
and the other pro forma and adjusted financial information included in the
Offering Memorandum (including "Adjusted EBITDA" and "Adjusted net debt")
are reasonable, and the adjustments used therein are appropriate to give
effect to the transactions or circumstances referred to therein.
(xiv) Ernst & Young LLP (the "INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM"), which has audited the financial statements and
supporting schedules as of December 31, 2003 and for the periods January
1, 2003 to January 9, 2003 and January 10, 2003 to December 31, 2003,
incorporated by reference in the Offering Memorandum, is an independent
- 13 -
registered public accounting firm in accordance with the Standards of the
Public Company Accounting Oversight Board (United States).
(xv) There is not pending or, to the knowledge of the Issuers,
threatened any action, suit, proceeding, inquiry or investigation to which
the Company or any of the Subsidiaries is a party, or to which the
property or assets of the Company or any of the Subsidiaries are subject,
before or brought by any court, arbitrator or governmental agency or body
that could reasonably be expected to have a Material Adverse Effect or
that seeks to restrain, enjoin, prevent the consummation of or otherwise
challenge the issuance or sale of the Securities to be sold hereunder or
the consummation of the other transactions described in the Offering
Memorandum.
(xvi) The Company and the Subsidiaries own or possess adequate
licenses or other rights to use all patents, trademarks, service marks,
trade names, copyrights, technology and know-how necessary to conduct the
business now or proposed to be conducted by the Company, the Surviving
Corporation and the Subsidiaries as described in the Offering Memorandum,
except for those patents, trademarks, service marks, trade names,
copyrights, technology and know-how the failure to own or have the right
to use which would not have a Material Adverse Effect, and, except as
disclosed in the Offering Memorandum, neither the Company, nor any of the
Subsidiaries has received any notice of infringement of or conflict with
(or knows of such infringement of or conflict with) rights of others with
respect to any patents, trademarks, service marks, trade names,
copyrights, technology or know-how except for conflicts which could not
reasonably be expected to have a Material Adverse Effect; and to the best
knowledge of the Initial Issuer, the Company, the Surviving Corporation
and the Subsidiaries do not in the conduct of their business as now
conducted or proposed to be conducted, infringe or conflict with any such
rights of any third party, except as could not reasonably be expected to
have a Material Adverse Effect.
(xvii) Since the date of the most recent financial statements
appearing or incorporated by reference in the Offering Memorandum, except
as described therein, (a) none of Parent, the Company or the Subsidiaries
has incurred any liabilities or obligations, direct or contingent, or
entered into or agreed to enter into any transactions or contracts
(written or oral) not in the ordinary course of business, which
liabilities, obligations, transactions or contracts would, individually or
in the aggregate, be material to the general affairs, management,
business, condition (financial or otherwise), prospects or results of
operations of the Company and the Subsidiaries, taken as a whole, (b) none
of Parent, the Company or the Subsidiaries has purchased any of its
outstanding capital stock, nor declared, paid or otherwise made any
dividend or distribution of any kind on its capital stock (other than with
respect to any of such Subsidiaries, the purchase of, or dividend or
distribution on, capital stock owned by the Company) and (c) there shall
not have been any material change in the capital stock or long-term
indebtedness of Parent, the Company or the Subsidiaries.
(xviii) Parent, the Company and the Subsidiaries have (A) filed all
federal, state and local and foreign tax returns which are required to be
filed through the date hereof, and all such tax returns are true, complete
and accurate in all material respects, or (B) received valid extensions
thereof and have paid all taxes shown on such returns and all assessments
received
- 14 -
by them except where, in the case of state and local and foreign tax
returns, the failure to file in clause (A), or extend the due date of or
pay the same in clause (B), in the aggregate, could not reasonably be
expected to have a Material Adverse Effect; the Initial Issuer, the
Company, Parent and the Surviving Corporation have no knowledge of any tax
deficiency which has been or might be asserted against Parent, the Company
or any of the Subsidiaries which could reasonably be expected to have a
Material Adverse Effect; and to the best knowledge of the Initial Issuer,
the Company, Parent and the Surviving Corporation, all tax liabilities of
Parent, the Company, the Surviving Corporation and the Subsidiaries are
adequately provided for on the consolidated books of Parent.
(xix) The statistical and market-related data included in the
Offering Memorandum are based on or derived from sources that the Company
and the Subsidiaries believe to be reliable and accurate.
(xx) None of the Initial Issuer, the Company, the Surviving
Corporation, the Subsidiaries or any agent acting on their behalf has
taken or will take any action that might cause this Agreement or the sale
of the Securities to violate Regulation T, U or X of the Board of
Governors of the Federal Reserve System, in each case as in effect, or as
the same may hereafter be in effect, on the Closing Date.
(xxi) Each of the Company, the Surviving Corporation and the
Subsidiaries has good and marketable title to all real property and
personal property and assets owned by them which is material to the
business of the Company, the Surviving Corporation and the Subsidiaries,
in each case subject to no lien, mortgage, pledge, charge or encumbrance
of any kind except (A) liens that are permitted under the Indenture, (B)
those set forth in the Offering Memorandum (including, without limitation,
those securing the credit facilities as described in the Offering
Memorandum) or (C) those which are not material in amount and do not
adversely affect the use made and proposed to be made of such property by
the Company and the Subsidiaries except for such uses the failure of which
to be made would not have a Material Adverse Effect. Each of the Company,
the Surviving Corporation and the Subsidiaries holds its leased properties
under valid, subsisting and enforceable leases, with such exceptions as
are not, individually or in the aggregate, material and do not,
individually or in the aggregate, interfere with the use made or proposed
to be made of such properties by the Company, the Surviving Corporation or
any of the Subsidiaries (except for such uses the failure of which to be
made would not have a Material Adverse Effect). Except as disclosed in the
Offering Memorandum, the Company, the Surviving Corporation and each of
the Subsidiaries owns or leases all such properties as are necessary to
its operations as now conducted or as proposed to be conducted (except for
such properties the failure of which to own or lease would not have a
Material Adverse Effect).
(xxii) There are no legal or governmental proceedings involving or
affecting the Company or any Subsidiary or any of their respective
properties or assets that would be required to be described in a
prospectus pursuant to the Act that are not described in the Offering
Memorandum, nor are there any material contracts or other documents that
would be required to be described in a prospectus pursuant to the Act that
are not described in the Offering Memorandum.
- 15 -
(xxiii) Except as would not, individually or in the aggregate, have
a Material Adverse Effect (A) each of the Company and the Subsidiaries is
in compliance with and not subject to liability under applicable
Environmental Laws (as defined below), (B) each of the Company and the
Subsidiaries has made all filings and provided all notices required under
any applicable Environmental Law, and has and is in compliance with all
Permits required under any applicable Environmental Laws and each of them
is in full force and effect, (C) there is no civil, criminal or
administrative action, suit, demand, claim, hearing, notice of violation,
investigation, proceeding, notice or demand letter or request for
information pending or, to the knowledge of the Company or any of the
Subsidiaries, threatened against the Company or any of the Subsidiaries
under any Environmental Law, (D) no lien, charge, encumbrance or
restriction has been recorded under any Environmental Law with respect to
any assets, facility or property owned, operated, leased or controlled by
the Company or any of the Subsidiaries, (E) none of the Company or the
Subsidiaries has received notice that it has been identified as a
potentially responsible party under the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended ("CERCLA"),
or any comparable state law and (F) no property or facility of the Company
or any of the Subsidiaries is (i) listed or proposed for listing on the
National Priorities List under CERCLA or is (ii) listed in the
Comprehensive Environmental Response, Compensation, Liability Information
System List promulgated pursuant to CERCLA, or on any comparable list
maintained by any state or local governmental authority.
For purposes of this Agreement, "ENVIRONMENTAL LAWS" means the
common law and all applicable federal, state and local laws or
regulations, codes, orders, decrees, judgments or injunctions issued,
promulgated, approved or entered thereunder, relating to pollution or
protection of public or employee health and safety or the environment,
including, without limitation, laws relating to (a) emissions, discharges,
releases or threatened releases of hazardous materials into the
environment (including, without limitation, ambient air, surface water,
ground water, land surface or subsurface strata), (b) the manufacture,
processing, distribution, use, generation, treatment, storage, disposal,
transport or handling of hazardous materials, and (iii) underground and
above ground storage tanks and related piping, and emissions, discharges,
releases or threatened releases therefrom.
(xxiv) Except as described in the Offering Memorandum, (A) no labor
disturbance by or dispute with the employees of the Company or any of the
Subsidiaries exists or, to the best knowledge of the Issuers, is
threatened and (B) the Issuers are not aware of any labor disturbance by
the employees of any of the Company's or the Subsidiaries' significant
manufacturers, suppliers, customers or contractors, that could reasonably
be expected, in the case of both (A) and (B), to have a Material Adverse
Effect.
(xxv) The Company and the Subsidiaries have, and the Surviving
Corporation will have, insurance covering their respective properties,
operations, personnel and businesses, which insures against such losses
and risks and in such amounts as are prudent and customary in the
businesses in which they are engaged and, in the opinion of the Company
and the Surviving Corporation, are adequate to protect their respective
businesses.
- 16 -
(xxvi) Except as would not have a Material Adverse Effect, none of
the Company, the Surviving Corporation or the Subsidiaries has any
liability for any prohibited transaction or funding deficiency or any
complete or partial withdrawal liability with respect to any pension,
profit sharing or other plan that is subject to the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), to which the Company,
the Surviving Corporation or any of the Subsidiaries makes or ever has
made a contribution and in which any employee of the Company or any of the
Subsidiary is or has ever been a participant. With respect to such plans,
the Company and each Subsidiary is in compliance in all material respects
with all applicable provisions of ERISA.
(xxvii) Each of Parent, the Company, the Surviving Corporation and
the Subsidiaries maintains a system of internal accounting controls
sufficient to provide reasonable assurances that (A) transactions are
executed in accordance with the management's general or specific
authorizations; (B) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets; (C)
access to assets is permitted only in accordance with management's general
or specific authorization; and (D) the recorded accountability for assets
is compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences. To the best knowledge of
the executive officers of the Company and Parent, after reasonable
investigation, Parent's and the Company's auditors and the audit committee
of the board of directors of Parent and the Company have been advised of
all, and none of such executive officers is now aware of any: (A)
significant deficiencies in the design or operation of internal controls
which could materially adversely affect Parent and the Company's ability
to record, process, summarize and report financial data; and (B) material
fraud that involves management or other employees who have a role in
Parent's or the Company's internal controls; and since the date of the
most recent evaluation of such disclosure controls and procedures, there
have been no significant changes in internal controls or in other factors
that could significantly affect internal controls, including any
corrective actions with regard to significant deficiencies and material
weaknesses. The Issuers have provided or made available to the Initial
Purchasers or their counsel true and complete copies of, or accurately
described to such counsel, all extant minutes or draft minutes of
meetings, or resolutions adopted by written consent (or all material
aspects thereof, in the case of oral descriptions), of the board of
directors of Parent, the Company and each Subsidiary and each committee of
each such board in the past three years.
(xxviii) Neither the Company, the Surviving Corporation nor any of
the Subsidiaries is, and upon consummation of the transactions
contemplated hereby, none of such persons will be, subject to registration
as an "investment company" or an entity "controlled by" an "investment
company" within the meaning of Investment Company Act of 1940, as amended,
and the rules and regulations promulgated thereunder. Each such person
will conduct its business and financial affairs in such a manner as to
ensure that it will not become an "investment company" or an entity
"controlled" by an "investment company". Neither the Company, the
Surviving Corporation nor any of the Subsidiaries is, and upon
consummation of the transactions contemplated hereby, none of such persons
will be, subject to registration as a "holding company" or a "subsidiary
company" of a holding company or an "affiliate" thereof within the meaning
of the Public Utility Holding Company Act of 1935, as amended.
- 17 -
(xxix) The Securities, the Indenture and the Registration Rights
Agreement will conform in all material respects to the descriptions
thereof in the Offering Memorandum.
(xxx) No holder of securities of the Company, the Surviving
Corporation or any Subsidiary will be entitled to have such securities
registered under the registration statements required to be filed by the
Issuers pursuant to the Registration Rights Agreement other than as
expressly permitted thereby.
(xxxi) Immediately prior to and immediately after the consummation
of the transactions contemplated hereby, the Company, or the Surviving
Corporation, together with the Subsidiaries on a consolidated basis is and
will be Solvent. As used in this paragraph, the term "SOLVENT" means, with
respect to a particular date, that on such date (A) the present fair
saleable value of the assets of the Company, or the Surviving Corporation,
together with the Subsidiaries on a consolidated basis is not less than
the total amount required to pay the probable liabilities of the Company,
or the Surviving Corporation, together with the subsidiaries on a
consolidated basis on its total existing debts and liabilities (including
contingent liabilities) as they become absolute and matured, (B) the
Company, or the Surviving Corporation, together with the Subsidiaries on a
consolidated basis is able to realize upon its assets and pay its debts
and other liabilities, contingent obligations and commitments as they
mature and become due in the normal course of business, (C) assuming the
sale of the Securities as contemplated by this Agreement and the Offering
Memorandum, the Company, or the Surviving Corporation, together with the
Subsidiaries on a consolidated basis is not incurring debts or liabilities
beyond its ability to pay as such debts and liabilities mature and (D) the
Company, or the Surviving Corporation, together with the Subsidiaries on a
consolidated basis is not engaged in any business or transaction, and is
not about to engage in any business or transaction, for which its property
would constitute unreasonably small capital after giving due consideration
to the prevailing practice in the industry in which the Company, or the
Surviving Corporation, is engaged. In computing the amount of such
contingent liabilities at any time, it is intended that such liabilities
will be computed at the amount that, in light of all the facts and
circumstances existing at such time, represents the amount that can
reasonably be expected to become an actual or matured liability.
(xxxii) None of the Initial Issuer, the Company, the Surviving
Corporation or any of the Subsidiaries nor, to the knowledge of the
Issuers, any director, officer, agent, employee or other person associated
with or acting on behalf of the Company or any of the Subsidiaries has
used any corporate funds for unlawful contributions, gifts, entertainment
or other unlawful expenses relating to political activity, made any
unlawful payment to foreign or domestic government officials or employees
or to foreign or domestic political parties or campaigns from corporate
funds, made any bribe, rebate, payoff, influence payment, kickback, or
other unlawful payment or violated any provision of the Foreign Corrupt
Practices Act of 1977.
(xxxiii) None of the Company, the Subsidiaries or any of their
respective "affiliates" (as defined in Rule 501(b) of Regulation D under
the Act) has directly, or through any agent, (a) sold, offered for sale,
solicited offers to buy or otherwise negotiated in respect of, any
"security" (as defined in the Act) that is or could be integrated with the
sale of the Securities in a manner that would require the registration
under the Act of the Securities or (b) engaged in
- 18 -
any form of general solicitation or general advertising (as those terms
are used in Regulation D under the Act) in connection with the offering of
the Securities or in any manner involving a public offering within the
meaning of Section 4(2) of the Act. Assuming the accuracy of the
representations and warranties of the Initial Purchasers in Section 8
hereof, it is not necessary in connection with the offer, sale and
delivery of the Securities to the Initial Purchasers in the manner
contemplated by this Agreement to register any of the Securities under the
Act or to qualify the Indenture under the TIA.
(xxxiv) No securities of the Company or any Subsidiary are of the
same class (within the meaning of Rule 144A under the Act) as the
Securities and listed on a national securities exchange registered under
Section 6 of the Exchange Act, or quoted in a U.S. automated inter-dealer
quotation system.
(xxxv) None of the Company, the Surviving Corporation or the
Subsidiaries has taken, nor will any of them take, directly or indirectly,
any action designed to, or that might be reasonably expected to, cause or
result in stabilization or manipulation of the price of the Securities.
(xxxvi) None of the Company, the Subsidiaries, any of their
respective affiliates or any person acting on its or their behalf (other
than the Initial Purchasers) has engaged in any directed selling efforts
(as that term is defined in Regulation S under the Act ("REGULATION S"))
with respect to the Securities; the Company, the Subsidiaries and their
respective Affiliates and any person acting on its or their behalf (other
than the Initial Purchasers) have complied with the offering restrictions
requirement of Regulation S.
(xxxvii) There is and has been no failure on the part of Parent or
the Company and any of their respective directors or officers, in their
capacities as such, to comply in all material respects with any provision
of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 and the rules and regulations
promulgated in connection therewith that are now in effect and that apply
to Parent and the Company.
Each certificate signed by any officer of any Issuer and delivered
to the Initial Purchasers or counsel for the Initial Purchasers pursuant to, or
in connection with, this Agreement shall be deemed to be a representation and
warranty by the Issuers to the Initial Purchasers as to the matters covered by
such certificate.
The Issuers acknowledges that the Initial Purchasers and, for
purposes of the opinions to be delivered to the Initial Purchasers pursuant to
Section 8 of this Agreement, counsel to the Issuers and counsel to the Initial
Purchasers will rely upon the accuracy and truth of the foregoing
representations and the Issuers hereby consents to such reliance.
(b) Each Initial Purchaser represents that it is a QIB and
acknowledges that it is purchasing the Securities pursuant to a private sale
exemption from registration under the Act, and that the Securities have not been
registered under the Act and may not be offered or sold within the United States
or to, or for the account or benefit of, U.S. persons except pursuant to an
exemption from the
- 19 -
registration requirements of the Act. Each Initial Purchaser, severally and not
jointly, represents, warrants and covenants to the Issuers that:
(i) Neither it, nor any person acting on its behalf, has or will
solicit offers for, or offer or sell, the Securities by any form of
general solicitation or general advertising (as those terms are used in
Regulation D under the Act) or in any manner involving a public offering
within the meaning of Section 4(2) of the Act, and it has and will solicit
offers for the Securities only from, and will offer and sell the
Securities only to, (1) persons whom such Initial Purchaser reasonably
believes to be QIBs or, if any such person is buying for one or more
institutional accounts for which such person is acting as fiduciary or
agent, only when such person has represented to such Initial Purchaser
that each such account is a QIB to whom notice has been given that such
sale or delivery is being made in reliance on Rule 144A, and, in each
case, in reliance on the exemption from the registration requirements of
the Act pursuant to Rule 144A, or (2) persons other than U.S. persons
outside the United States in reliance on, and in compliance with, the
exemption from the registration requirements of the Act provided by
Regulation S;
(ii) With respect to offers and sales outside the United States,
such Initial Purchaser has offered the Securities and will offer and sell
the Securities (1) as part of its distribution at any time and (2)
otherwise until 40 days after the later of the commencement of the
offering of the Securities and the Closing Date, only in accordance with
Rule 903 of Regulation S or another exemption from the registration
requirements of the Act. Accordingly, neither such Initial Purchaser nor
any person acting on its behalf has engaged or will engage in any directed
selling efforts (within the meaning of Regulation S) with respect to the
Securities, and any such persons have complied and will comply with the
offering restrictions requirements of Regulation S. Terms used in this
Section 5(b)(ii) have the meanings given to them by Regulation S.
(iii) Each Initial Purchaser severally agrees that, at or prior to
confirmation of a sale of Securities pursuant to Regulation S it will have
sent to each distributor, dealer or person receiving a selling concession,
fee or other remuneration that purchases Securities from it or through it
during the restricted period a confirmation or notice to substantially the
following effect:
"The Securities covered hereby have not been registered under
the United States Securities Act of 1933, as amended (the
"SECURITIES ACT"), and may not be offered or sold within the United
States or to or for the account or benefit of, U.S. persons (i) as
part of their distribution at any time and (ii) otherwise until
forty days after the later of the date upon which the offering of
the Securities commenced and the date of closing, except in either
case in accordance with Regulation S or Rule 144A under the
Securities Act. Terms used above have the meaning given to them by
Regulation S."
The Initial Purchasers understand that the Issuers and, for purposes
of the opinions to be delivered to them pursuant to Section 8 hereof, counsel to
the Issuers and counsel to the Initial
- 20 -
Purchasers will rely upon the accuracy and truth of the foregoing
representations, and each Initial Purchaser hereby consents to such reliance.
6. Indemnification. (a) The Issuers, jointly and severally, agree to
indemnify and hold harmless the Initial Purchasers, each person, if any, who
controls any Initial Purchaser within the meaning of Section 15 of the Act or
Section 20(a) of the Exchange Act, the agents, employees, officers and directors
of any Initial Purchaser and the agents, employees, officers and directors of
any such controlling person from and against any and all losses, liabilities,
claims, damages and expenses whatsoever (including, but not limited, to
reasonable attorneys' fees and any and all reasonable expenses whatsoever
incurred in investigating, preparing or defending against any litigation,
commenced or threatened, or any claim whatsoever, and any and all reasonable
amounts paid in settlement of any claim or litigation) (collectively, "LOSSES")
to which they or any of them may become subject under the Act, the Exchange Act
or otherwise insofar as such Losses (or actions in respect thereof) arise out of
or are based upon any untrue statement or alleged untrue statement of a material
fact contained in the Preliminary Offering Memorandum or the Offering
Memorandum, or in any supplement thereto or amendment thereof, or arise out of
or are based upon the omission or alleged omission to state therein a material
fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided, none of the Issuers will
be liable in any such case to the extent, but only to the extent, that any such
Loss arises out of or is based upon any such untrue statement or alleged untrue
statement or omission or alleged omission relating to an Initial Purchaser made
therein in reliance upon and in conformity with written information furnished to
the Initial Issuer, the Company or Parent by or on behalf of such Initial
Purchaser through the Representative expressly for use therein; provided,
further, that the indemnity agreement contained in this paragraph 6(a) shall not
inure to the benefit of any Initial Purchaser to the extent that (i) a copy of
the Offering Memorandum as then amended or supplemented was not sent or given to
a person to whom the Initial Purchaser sold the Securities and (ii) such Loss
arises out of or is based upon an untrue statement or alleged untrue statement
in or omission or alleged omission relating to an Initial Purchaser from (x) the
Preliminary Offering Memorandum that was corrected in the Offering Memorandum as
then amended or supplemented or (y) the Offering Memorandum as then amended or
supplemented that was corrected in a subsequent amendment or supplement thereof,
unless such failure to deliver the Offering Memorandum as then amended or
supplemented was a result of non-compliance by the Issuers with the provisions
of Section 4, and so long as such Offering Memorandum as then amended or
supplemented was provided to the Initial Purchasers in the requisite quantity
and on a timely basis to permit delivery on or prior to the written confirmation
of the sale of such Securities. This indemnity agreement will be in addition to
any liability that the Issuers may otherwise have, including, but not limited
to, liability under this Agreement. Notwithstanding anything to the contrary
contained herein, any costs or expenses advanced by the Issuers to any
indemnified person pursuant to the terms of this Section 6(a) shall be promptly
reimbursed to the extent that such indemnified person is ultimately determined
not to have been entitled to indemnification therefor.
(b) Each Initial Purchaser agrees to indemnify and hold harmless the
Issuers, and each person, if any, who controls any of the Issuers within the
meaning of Section 15 of the Act or Section 20(a) of the Exchange Act, and the
agents, employees, officers and directors of any of the Issuers or of any such
controlling person from and against any and all Losses to which they or any of
them may become subject under the Act, the Exchange Act or otherwise insofar as
such Losses (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of a
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material fact contained in the Preliminary Offering Memorandum or the Offering
Memorandum, or in any amendment thereof or supplement thereto, or arise out of
or are based upon the omission or alleged omission to state therein a material
fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, in each case to the extent, but only
to the extent, that any such Loss arises out of or is based upon any untrue
statement or alleged untrue statement or omission or alleged omission relating
to such Initial Purchaser made therein in reliance upon and in conformity with
information furnished in writing to the Initial Issuer, Parent or the Company by
or on behalf of such Initial Purchaser through the Representative expressly for
use therein. The Issuers and the Initial Purchasers acknowledge that the
information described in Section 9 is the only information furnished in writing
by the Initial Purchasers to the Initial Issuer, Parent or the Company expressly
for use in the Preliminary Offering Memorandum or the Offering Memorandum.
(c) Promptly after receipt by an indemnified party under subsection 6(a)
or 6(b) above of notice of the commencement of any action, suit or proceeding
(collectively, an "ACTION"), such indemnified party shall, if a claim in respect
thereof is to be made against the indemnifying party under such subsection,
notify each party against whom indemnification is to be sought in writing of the
commencement of such action (but the failure so to notify an indemnifying party
shall not relieve such indemnifying party from any liability that it may have
under this Section 6 except to the extent that it has been prejudiced in any
material respect by such failure). In case any such action is brought against
any indemnified party, and it notifies an indemnifying party of the commencement
of such action, the indemnifying party will be entitled to participate in such
action, and to the extent it may elect by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense of such action with counsel reasonably
satisfactory to such indemnified party. Notwithstanding the foregoing, the
indemnified party or parties shall have the right to employ its or their own
counsel in any such action, but the reasonable fees and expenses of such counsel
shall be at the expense of such indemnified party or parties unless (i) the
employment of such counsel and the payment of such fees and expenses by the
indemnifying parties shall have been authorized and agreed to in writing by the
indemnifying parties in connection with the defense of such action, (ii) the
indemnifying parties shall not have employed counsel to take charge of the
defense of such action within a reasonable time after notice of commencement of
the action, or (iii) the named parties to such action (including any impleaded
parties) include such indemnified party and the indemnifying parties (or such
indemnifying parties have assumed the defense of such action), and such
indemnified party or parties shall have reasonably concluded that there may be
defenses available to it or them that are different from or additional to those
available to one or all of the indemnifying parties (in which case the
indemnifying parties shall not have the right to direct the defense of such
action on behalf of the indemnified party or parties), in any of which events
such reasonable fees and expenses of counsel shall be borne by the indemnifying
parties. In no event shall the indemnifying parties be liable for the fees and
expenses of more than one counsel (together with appropriate local counsel) at
any time for all indemnified parties in connection with any one action or
separate but substantially similar or related actions arising in the same
jurisdiction out of the same general allegations or circumstances. An
indemnifying party shall not be liable for any settlement of any claim or action
effected without its written consent, which consent may not be unreasonably
withheld. No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened proceeding
in respect of which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party, unless
such settlement (x) includes an unconditional release of such indemnified party
from all liability on claims that are the
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subject matter of such proceeding and (y) does not include a statement as to or
an admission of fault, culpability or a failure to act by or on behalf of any
indemnified party.
7. Contribution. In order to provide for contribution in
circumstances in which the indemnification provided for in Section 6 of this
Agreement is for any reason held to be unavailable from the indemnifying party,
or is insufficient to hold harmless a party indemnified under Section 6 of this
Agreement, each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of such aggregate Losses (i) in
such proportion as is appropriate to reflect the relative benefits received by
the Issuers, on the one hand, and the Initial Purchasers, on the other hand,
from the offering of the Securities or (ii) if such allocation is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to above but also the relative fault of the Issuers,
on the one hand, and the Initial Purchasers, on the other hand, in connection
with the statements or omissions that resulted in such Losses, as well as any
other relevant equitable considerations. The relative benefits received by the
Issuers, on the one hand, and the Initial Purchasers, on the other hand, shall
be deemed to be in the same proportion as (x) the total proceeds from the
offering of Securities (net of discounts and commissions but before deducting
expenses) received by the Issuers are to (y) the total discount and commissions
received by the Initial Purchasers. The relative fault of the Issuers, on the
one hand, and the Initial Purchasers, on the other hand, shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by an Issuer or the Initial Purchasers and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission or alleged statement or omission.
The Issuers and the Initial Purchasers agree that it would not be
just and equitable if contribution pursuant to this Section 7 were determined by
pro rata allocation or by any other method of allocation that does not take into
account the equitable considerations referred to above. Notwithstanding the
provisions of this Section 7, (i) in no case shall any Initial Purchaser be
required to contribute any amount in excess of the amount by which the total
discount and commissions applicable to the Securities purchased by such Initial
Purchaser pursuant to this Agreement exceeds the amount of any damages that such
Initial Purchaser has otherwise been required to pay by reason of any untrue or
alleged untrue statement or omission or alleged omission and (ii) no person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. For purposes of this Section 7, each person,
if any, who controls any Initial Purchaser within the meaning of Section 15 of
the Act or Section 20(a) of the Exchange Act shall have the same rights to
contribution as the Initial Purchasers, and each person, if any, who controls an
Issuer within the meaning of Section 15 of the Act or Section 20(a) of the
Exchange Act and each director, officer, employee and agent of an Issuer shall
have the same rights to contribution as the Issuers. Any party entitled to
contribution will, promptly after receipt of notice of commencement of any
action against such party in respect of which a claim for contribution may be
made against another party or parties under this Section 7, notify such party or
parties from whom contribution may be sought, but the omission to so notify such
party or parties shall not relieve the party or parties from whom contribution
may be sought from any obligation it or they may have under this Section 7 or
otherwise, except to the extent that it has been prejudiced in any material
respect by such failure; provided, however, that no additional notice shall be
required with respect to any action for which notice has been given under
Section 6 for purposes of indemnification. Anything in this section to the
contrary notwithstanding, no party shall be liable for contribution with
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respect to any action or claim settled without its written consent; provided,
however, that such written consent was not unreasonably withheld.
8. Conditions of Initial Purchasers' Obligations. The obligations of
the Initial Purchasers to purchase and pay for the Securities, as provided for
in this Agreement, shall be subject to satisfaction of the following conditions
prior to or concurrently with such purchase (or, in the case of conditions that
relate to the Surviving Corporation and the Guarantors, substantially
concurrently with such purchase):
(a) All of the representations and warranties of the Issuers
contained in this Agreement shall be true and correct in all material
respects on the date of this Agreement and on the Closing Date. The
Issuers shall have performed or complied in all material respects with all
of the agreements and covenants contained in this Agreement and required
to be performed or complied with by them at or prior to the Closing Date.
The Initial Purchasers shall have received a certificate, dated the
Closing Date, signed by the chief executive officer and the chief
financial officer of the Surviving Corporation, and by an authorized
officer of the Initial Issuer, certifying as to the foregoing and to the
effect in Section 8(c).
(b) The Offering Memorandum shall have been printed and copies
distributed to the Initial Purchasers on the first business day
immediately following the date of this Agreement or at such later date as
the Initial Purchasers may determine. No stop order suspending the
qualification or exemption from qualification of the Securities in any
jurisdiction shall have been issued and no proceeding for that purpose
shall have been commenced or shall be pending or threatened.
(c) Since the execution of this Agreement, there shall not have been
any decrease in the rating of any debt or preferred stock of the Company
or any Subsidiary by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the Act), or
any notice given of any intended or potential decrease in any such rating
or of a possible change in any such rating that does not indicate the
direction of the possible change.
(d) The Initial Purchasers shall have received on the Closing Date
opinions dated the Closing Date, addressed to the Initial Purchasers, of
(x) Ropes & ▇▇▇▇ LLP, counsel to the Issuers, substantially in the form of
Exhibit B-1 attached hereto, (y) ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, general counsel of the
Surviving Corporation, substantially in the form of Exhibit B-2 attached
hereto, and (z) opinions of local counsel in the states of Oklahoma,
Missouri, California, Kentucky, Arizona and Michigan, in form and
substance reasonably satisfactory to the Representative and counsel to the
Initial Purchasers.
(e) The Initial Purchasers shall have received on the Closing Date
an opinion dated the Closing Date of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, counsel
to the Initial Purchasers, in form and substance satisfactory to the
Representative. Such counsel shall have been furnished with such
certificates and documents as they may reasonably request to enable them
to review or pass upon the matters referred to in this Section 8 and in
order to evidence the accuracy, completeness or satisfaction in all
material respects of any of the representations, warranties or conditions
contained in this Agreement.
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(f) On the date hereof, the Initial Purchasers shall have received a
"comfort letter" from the independent public accountants for Parent, dated
the date of this Agreement, addressed to the Initial Purchasers and in
form and substance reasonably satisfactory to the Representative and
counsel to the Initial Purchasers (it being understood that if the
Offering Memorandum is not printed on the date hereof, such comfort letter
shall, on the date hereof, contain excerpts from the Preliminary Offering
Memorandum indicating the procedures performed by such independent public
accountants on the financial data included in the Preliminary Offering
Memorandum and that, within twenty-four hours after the Offering
Memorandum becomes available in final form (electronically or otherwise),
the Initial Purchasers shall receive replacement excerpts from the
Offering Memorandum indicating the procedures performed by such
independent public accountants on the financial data included therein in
form and substance satisfactory to the Representative and counsel to the
Initial Purchasers). In addition, the Initial Purchasers shall have
received a "bring-down comfort letter" from the independent public
accountants for the Parent, dated as of the Closing Date, addressed to the
Initial Purchasers and in form and substance reasonably satisfactory to
the Representative and counsel to the Initial Purchasers.
(g) The Issuers and the Trustee shall have executed and delivered
the Indenture and the Initial Purchasers shall have received copies
thereof. The Issuers shall have executed and delivered the Registration
Rights Agreement and the Initial Purchasers shall have received executed
counterparts thereof.
(h) The Initial Purchasers shall have been furnished with wiring
instructions for the application of the proceeds of the Securities in
accordance with this Agreement and such other information as they may
reasonably request.
(i) The Securities shall be eligible for trading in Portal upon
issuance. All agreements set forth in the blanket representation letter of
the Initial Issuer to DTC relating to the approval of the Securities by
DTC for "book-entry" transfer shall have been complied with.
(j) The Company and the Subsidiaries parties thereto shall have
executed and delivered the Credit Documents and the Initial Purchasers
shall have received copies thereof. Each of the other Transactions shall
have been, or shall substantially simultaneously be, consummated without
any amendment or waiver of any of the Transaction Documents (other than
any such amendment or waiver approved by the Representative, such approval
not to be unreasonably withheld or delayed), and the Initial Purchasers
shall have received satisfactory evidence thereof.
(k) The Surviving Corporation and the Guarantors shall have executed
a Joinder Agreement, thereby becoming parties hereto.
If any of the conditions specified in this Section 8 shall not have
been fulfilled when and as required by this Agreement to be fulfilled (or waived
by the Initial Purchasers), this Agreement may be terminated by the Initial
Purchasers on notice to the Initial Issuer at any time at or prior to the
Closing Date, and such termination shall be without liability of any party to
any other party.
- 25 -
The documents required to be delivered by this Section 8 will be
delivered at the office of counsel for the Initial Purchasers on the Closing
Date.
9. Initial Purchasers Information. The Issuers and the Initial
Purchasers severally acknowledge that the statements set forth in the first and
second sentence of the sixth paragraph and the entire seventh paragraph under
"Plan of distribution" in the Offering Memorandum constitute the only
information furnished in writing by or behalf of any Initial Purchaser expressly
for use in the Preliminary Offering Memorandum or the Offering Memorandum.
10. Survival of Representations and Agreements. All representations
and warranties, covenants and agreements contained in this Agreement, including
the agreements contained in Sections 4(f) and 11(d), the indemnity agreements
contained in Section 6 and the contribution agreements contained in Section 7,
shall remain operative and in full force and effect regardless of any
investigation made by or on behalf of the Initial Purchasers or any controlling
person thereof or by or on behalf of the Issuers or any controlling person
thereof, and shall survive delivery of and payment for the Original Notes and
the Original Guarantees to and by the Initial Purchasers. The agreements
contained in Sections 4(f), 6, 7, 9 and 11(d) shall survive the termination of
this Agreement, including pursuant to Section 11.
11. Effective Date of Agreement; Termination. (a) This Agreement
shall become effective upon execution and delivery of a counterpart hereof by
each of the parties hereto.
(b) The Initial Purchasers shall have the right to terminate this
Agreement at any time prior to the Closing Date by notice to the Initial Issuer
from the Initial Purchasers, without liability (other than with respect to
Sections 6 and 7) on the Initial Purchasers' part to the Initial Issuer or any
affiliate thereof if, on or prior to such date, (i) the Initial Issuer shall
have failed, refused or been unable to perform any agreement on its part to be
performed under this Agreement when and as required; (ii) any other condition to
the obligations of the Initial Purchasers under this Agreement to be fulfilled
by the Issuers pursuant to Section 8 is not fulfilled when and as required in
any material respect; (iii) trading in any securities of the Company, or trading
in securities generally on the New York Stock Exchange, the American Stock
Exchange or the Nasdaq National Market shall have been suspended or materially
limited, or minimum prices shall have been established thereon by the
Commission, or by such exchange or other regulatory body or governmental
authority having jurisdiction; (iv) a general moratorium shall have been
declared by either Federal or New York State authorities or a material
disruption in commercial banking or securities settlement or clearance services
in the United States shall have occurred; (v) there is an outbreak or escalation
of hostilities or national or international calamity in any case involving the
United States, on or after the date of this Agreement, or if there has been a
declaration by the United States of a national emergency or war or other
national or international calamity or crisis (economic, political, financial or
otherwise) which affects the U.S. and international markets, making it, in the
Representative's judgment, impracticable to proceed with the offering or
delivery of the Securities on the terms and in the manner contemplated in the
Offering Memorandum; or (vi) there shall have been such a material adverse
change in general economic, political or financial conditions or the effect (or
potential effect if the financial markets in the United States have not yet
opened) of international conditions on the financial markets in the United
States shall be such as, in the Representative's judgment, to make it
inadvisable or impracticable to proceed
- 26 -
with the offering or delivery of the Securities on the terms and in the manner
contemplated in the Offering Memorandum.
(c) Any notice of termination pursuant to this Section 11 shall be
given at the address specified in Section 12 below by telephone or facsimile,
confirmed in writing by letter.
(d) If any one or more Initial Purchasers shall fail to purchase and
pay for any of the Securities agreed to be purchased by such Initial Purchaser
hereunder and such failure to purchase shall constitute a default in the
performance of its or their obligations under this Agreement, the remaining
Initial Purchasers shall be obligated severally to take up and pay for (in the
respective proportions which the principal amount of Securities set forth
opposite their names in Schedule I hereto bears to the aggregate principal
amount of Securities set forth opposite the names of all the remaining Initial
Purchasers) the Securities which the defaulting Initial Purchaser or Initial
Purchasers agreed but failed to purchase; provided, however, that in the event
that the aggregate principal amount of Securities which the defaulting Initial
Purchaser or Initial Purchasers agreed but failed to purchase shall exceed 10%
of the aggregate principal amount of Securities set forth in Schedule I hereto,
the remaining Initial Purchasers shall have the right to purchase all, but shall
not be under any obligation to purchase any, of the Securities, and if such
nondefaulting Initial Purchasers do not purchase all the Securities, this
Agreement will terminate without liability to any nondefaulting Initial
Purchaser or the Issuers. In the event of a default by any Initial Purchaser as
set forth in this Section 11(e), with the consent of the Initial Issuer (which
consent shall not be unreasonably withheld or delayed) the Closing Date shall be
postponed for such period, not exceeding seven business days, as the
Representative shall determine in order that the required changes in the
Offering Memorandum or in any other documents or arrangements may be effected.
Nothing contained in this Agreement shall relieve any defaulting Initial
Purchaser of its liability, if any, to the Issuers or any nondefaulting Initial
Purchaser for damages occasioned by its default hereunder.
12. Notice. All communications with respect to or under this
Agreement, except as may be otherwise specifically provided in this Agreement,
shall be in writing and, if sent to the Initial Purchasers, shall be mailed,
delivered or telecopied and confirmed in writing to c/o UBS Securities LLC, ▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (fax number: ▇▇▇-▇▇▇-▇▇▇▇), Attention: High
Yield Syndicate Department, with a copy for information purposes only to (i) UBS
Securities LLC, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (fax number:
▇▇▇-▇▇▇-▇▇▇▇), Attention: Legal and Compliance Department and (ii) ▇▇▇▇▇▇ ▇▇▇▇▇▇
& ▇▇▇▇▇▇▇ LLP, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ (fax number: ▇▇▇-▇▇▇-▇▇▇▇),
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇; and if sent to the Issuers, shall be mailed,
delivered or telecopied and confirmed in writing to Nortek, Inc., ▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ (telephone: (▇▇▇) ▇▇▇-▇▇▇▇, fax: (401)
▇▇▇-▇▇▇▇), Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇; with a copy to ▇▇▇▇▇▇ ▇. ▇▇▇ Partners,
L.P., ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇, facsimile: (617)
227-3514, Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇ ▇. ▇▇▇▇▇▇, with an additional
copy to Ropes & ▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇-▇▇▇▇, facsimile: (▇▇▇) ▇▇▇-▇▇▇▇, Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
All such notices and communications shall be deemed to have been
duly given: when delivered by hand, if personally delivered; five business days
after being deposited in the mail, postage prepaid, if mailed; when receipt
acknowledged by telecopier machine, if telecopied; and one business day after
being timely delivered to a next-day air courier.
- 27 -
13. Parties. This Agreement shall inure solely to the benefit of,
and shall be binding upon, the Initial Purchasers, the Issuers and the other
indemnified parties referred to in Sections 6 and 7, and their respective
successors and assigns, and no other person shall have or be construed to have
any legal or equitable right, remedy or claim under or in respect of or by
virtue of this Agreement or any provision herein contained. The term "successors
and assigns" shall not include a purchaser, in its capacity as such, of
Securities from the Initial Purchasers.
14. Construction. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York applicable to contracts
made and to be performed wholly therein (without giving effect to any provisions
thereof relating to conflicts of law, except Section 1504-1 of the New York
General Obligations Law).
15. Submission to Jurisdiction; Waiver of Jury Trial. No proceeding
related to this Agreement or the transactions contemplated hereby may be
commenced, prosecuted or continued in any court other than the courts of the
State of New York located in the City and County of New York or in the United
States District Court for the Southern District of New York, which courts shall
have jurisdiction over the adjudication of such matters, and each of the parties
hereto hereby consents to the jurisdiction of such courts and personal service
with respect thereto. Each of the parties hereto hereby waives all right to
trial by jury in any proceeding (whether based upon contract, tort or otherwise)
in any way arising out of or relating to this Agreement. Each of the parties
hereto agrees that a final judgment in any such proceeding brought in any such
court shall be conclusive and binding upon the parties hereto and may be
enforced in any other courts in the jurisdiction of which any party hereto is or
may be subject, by suit upon such judgment.
16. Captions. The captions included in this Agreement are included
solely for convenience of reference and are not to be considered a part of this
Agreement.
17. Counterparts. This Agreement may be executed in various
counterparts that together shall constitute one and the same instrument.
[Signature Pages Follow]
If the foregoing Purchase Agreement correctly sets forth the
understanding among you and the Initial Purchasers, please so indicate in the
space provided below for the purpose, whereupon this letter and your acceptance
shall constitute a binding agreement among you and the Initial Purchasers.
THL Buildco, Inc.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
___________________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
- 2 -
Confirmed and accepted as of the date first above written:
UBS SECURITIES LLC
CREDIT SUISSE FIRST BOSTON LLC
BANC OF AMERICA SECURITIES LLC
BEAR, ▇▇▇▇▇▇▇ & CO. INC.
SOVEREIGN SECURITIES CORPORATION, LLC
By: UBS SECURITIES LLC
as Representative of the several Initial Purchasers
By: /s/ L. ▇▇▇▇▇ ▇▇▇▇▇▇▇
_______________________________________
Name: L. ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Director
High Yield Capital Markets
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇
_______________________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇
Title: Executive Director
High Yield Capital Markets
SCHEDULE I
INITIAL PURCHASER Principal Amount of Securities to Be Purchased
----------------- ----------------------------------------------
UBS Securities LLC $259,375,000
Credit Suisse First Boston LLC $259,375,000
Banc of America Securities LLC $ 62,500,000
Bear, ▇▇▇▇▇▇▇ & Co. Inc. $ 31,250,000
Sovereign Securities Corporation, LLC $ 12,500,000
------------
TOTAL $625,000,000
============
SCHEDULE II
% HELD, DIRECTLY
JURISDICTION OR INDIRECTLY, BY
GUARANTOR OF ORGANIZATION NORTEK, INC.
--------- --------------- ------------
▇▇▇▇▇▇ Manufacturing, Inc. Delaware 100%
Broan-NuTone LLC Delaware 100%
Commercial Environmental Systems Group, Inc. Delaware 100%
DMU ▇▇▇▇▇▇ Inc. Delaware 100%
Elan Home Systems, L.L.C. Kentucky 100%
Governair Corporation Oklahoma 100%
J.A.R. Industries, Inc. Missouri 100%
▇▇▇▇▇▇ Industries, Inc. Delaware 100%
Linear LLC California 100%
Linear H.K. LLC Delaware 100%
Mammoth, Inc. Delaware 100%
Mammoth China, Ltd. Delaware 100%
Multiplex Technology, Inc. California 100%
Nordyne Inc. Delaware 100%
NuTone Inc. Delaware 100%
OmniMount Systems, Inc. Arizona 100%
Operator Specialty Company, Inc. Michigan 100%
Rangaire GP, Inc. Delaware 100%
Rangaire LP Delaware 100%
Rangaire LP, Inc. Delaware 100%
SpeakerCraft, Inc. Delaware 100%
Temtrol, Inc. Oklahoma 100%
WDS LLC Delaware 100%
Webco, Inc. Missouri 100%
Xantech Corporation California 100%
SCHEDULE III
% HELD, DIRECTLY
JURISDICTION OR INDIRECTLY, BY
SUBSIDIARY OF ORGANIZATION NORTEK, INC.
---------- --------------- ------------
▇▇▇▇▇▇ Manufacturing, Inc. Delaware 100%
Best Deutschland GmbH Germany 100%
Best France S.A. France 100%
Best S.p.A. Italy 100%
Broan-NuTone Canada Inc. Ontario 100%
Broan-NuTone Group, Inc. Delaware 100%
Broan-NuTone LLC Delaware 100%
Commercial Environmental Systems Group, Inc. Delaware 100%
DMU ▇▇▇▇▇▇ Inc. Delaware 100%
▇▇▇▇▇-▇▇▇▇▇▇▇▇ (Millbank) Limited UK 100%
▇▇▇▇▇-▇▇▇▇▇▇▇▇ Exports Limited UK 100%
▇▇▇▇▇-▇▇▇▇▇▇▇▇ Group Limited UK 100%
▇▇▇▇▇-▇▇▇▇▇▇▇▇ Holding Limited UK 100%
▇▇▇▇▇-▇▇▇▇▇▇▇▇ Limited UK 100%
▇▇▇▇▇-▇▇▇▇▇▇▇▇ Products Limited UK 100%
▇▇▇▇▇-▇▇▇▇▇▇▇▇ Service Limited UK 100%
Edenaire Limited UK 100%
Elan Home Systems, L.L.C. Kentucky 100%
Elektromec S.p.A. Italy 100%
Fidelity Investment Co. Rhode Island 100%
Governair Corporation Oklahoma 100%
Innergy Tech Inc. Quebec 100%
J.A.R. Industries, Inc. Missouri 100%
▇▇▇▇▇▇ Industries, Inc. Delaware 100%
Linear LLC California 100%
Linear Foreign Sales Corporation U.S. V.I. 100%
Linear H.K. LLC Delaware 100%
Linear H.K. Manufacturing Limited Hong Kong, People's
Republic of China 100%
Mammoth, Inc. Delaware 100%
Mammoth China, Ltd. Delaware 100%
MPDC, Inc. Delaware 100%
Multiplex Technology, Inc. California 100%
Niche Medical Inc. Delaware 100%
Nordyne, Inc. Delaware 100%
▇▇▇▇▇▇▇▇, Inc. Rhode Island 100%
- 2 -
NorMed, Inc. Delaware 100%
Nortek (UK) Limited UK 100%
Nortek Holding B.V. Netherlands 100%
NuTone Inc. Delaware 100%
OmniMount Systems, Inc. Arizona 100%
Operator Specialty Company, Inc. Michigan 100%
Precision Air Control Limited UK 100%
Rangaire GP, Inc. Delaware 100%
Rangaire LP Delaware 100%
Rangaire LP, Inc. Delaware 100%
Ring Brothers Corporation California 100%
Ring Brothers Investment Co., Inc. California 100%
SpeakerCraft, Inc. Delaware 100%
▇▇▇▇▇▇▇ Canada Limited Ontario 100%
Temtrol, Inc. Oklahoma 100%
Vapac Humidity Control Limited UK 100%
Venmar CES, Inc. Saskatchewan 100%
Venmar Ventilation (H.D.H.) Inc. Quebec 100%
Venmar Ventilation Inc. Quebec 100%
Ventrol Air Handling Systems Inc. Canada (Federal Corp.) 100%
WDS LLC Delaware 100%
We Monitor America Incorporated Colorado 100%
Webco, Inc. Missouri 100%
Xantech Corporation California 100%
SCHEDULE IV
OTHER EQUITY INTERESTS
Shanghai Mammoth Air Conditioning Co., Ltd.-- 47% equity interest held by
Mammoth China, Ltd.
EXHIBIT A
FORM OF REGISTRATION RIGHTS AGREEMENT
[To be attached.]
▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF OPINION OF ROPES & ▇▇▇▇ LLP
[To be attached.]
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF OPINION OF ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
GENERAL COUNSEL FOR THE COMPANY
[To be attached.]
B-2-1
EXHIBIT C
FORM OF JOINDER AGREEMENT
[To be attached.]
C-1