Exhibit 10.157
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Execution Copy
▇▇▇▇▇▇▇ & CO.
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NOTE PURCHASE AGREEMENT
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DATED AS OF FEBRUARY 12, 2009
$125,000,000 PRINCIPAL AMOUNT OF 10% SERIES A-2009 SENIOR NOTES
DUE FEBRUARY 13, 2017
$125,000,000 PRINCIPAL AMOUNT OF 10% SERIES B-2009 SENIOR NOTES
DUE FEBRUARY 13, 2019
GUARANTIED BY
▇▇▇▇▇▇▇ AND COMPANY
▇▇▇▇▇▇▇ & CO. INTERNATIONAL
▇▇▇▇▇▇▇ & CO. JAPAN INC.
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TABLE OF CONTENTS
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1. AUTHORIZATION OF NOTES..................................................................................1
2. SALE AND PURCHASE OF NOTES..............................................................................1
3. CLOSING.................................................................................................1
4. CONDITIONS TO CLOSING...................................................................................2
4.1 Representations and Warranties.................................................................2
4.2 Performance; No Default........................................................................2
4.3 Compliance Certificates........................................................................2
4.4 Opinions of Counsel............................................................................3
4.5 Purchase Permitted By Applicable Law, etc......................................................3
4.6 Sale of Other Notes............................................................................3
4.7 Guaranty Agreement.............................................................................3
4.8 Payment of Fees................................................................................4
4.9 Private Placement Number.......................................................................4
4.10 Changes in Corporate Structure.................................................................4
4.11 Proceedings and Documents......................................................................4
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY...........................................................4
5.1 Organization; Power and Authority..............................................................4
5.2 Authorization, etc.............................................................................5
5.3 Disclosure.....................................................................................5
5.4 Organization and Ownership of Shares of Subsidiaries; Affiliates...............................5
5.5 Financial Statements...........................................................................6
5.6 Compliance with Laws, Other Instruments, etc...................................................6
5.7 Governmental Authorizations, etc...............................................................6
5.8 Litigation; Observance of Agreements, Statutes and Orders......................................7
5.9 Taxes..........................................................................................7
5.10 Title to Property; Leases......................................................................7
5.11 Licenses, Permits, etc.........................................................................7
5.12 Compliance with ERISA..........................................................................8
5.13 Private Offering by the Company................................................................9
5.14 Use of Proceeds; Margin Regulations............................................................9
5.15 Existing Indebtedness; Future Liens...........................................................10
5.16 Foreign Assets Control Regulations, etc.......................................................10
5.17 Status under Certain Statutes.................................................................10
5.18 Environmental Matters.........................................................................10
6. REPRESENTATIONS OF THE PURCHASERS......................................................................11
6.1 Purchase for Investment.......................................................................11
6.2 Source of Funds...............................................................................11
7. INFORMATION AS TO COMPANY..............................................................................13
7.1 Financial and Business Information............................................................13
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TABLE OF CONTENTS
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(continued)
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7.2 Officer's Certificate.........................................................................16
7.3 Inspection....................................................................................16
8. PAYMENT OF THE NOTES...................................................................................17
8.1 Interest Rates................................................................................17
8.2 Required Principal Prepayments; Payment at Maturity...........................................17
8.3 Optional Prepayments with Make-Whole Amount...................................................17
8.4 Allocation of Partial Prepayments.............................................................17
8.5 Maturity; Surrender, etc......................................................................18
8.6 No Other Optional Prepayments or Purchase of Notes............................................18
8.7 Make-Whole Amount.............................................................................18
9. AFFIRMATIVE COVENANTS..................................................................................19
9.1 Compliance with Law...........................................................................19
9.2 Insurance.....................................................................................20
9.3 Maintenance of Properties.....................................................................20
9.4 Payment of Taxes and Claims...................................................................20
9.5 Corporate Existence, etc......................................................................20
9.6 Subsequent Guarantors.........................................................................21
10. NEGATIVE COVENANTS.....................................................................................21
10.1 Transactions with Affiliates..................................................................21
10.2 Line of Business..............................................................................21
10.3 Limitation on Debt............................................................................21
10.4 Liens.........................................................................................22
10.5 Merger, Consolidation, etc....................................................................25
10.6 Sale of Assets................................................................................26
10.7 Most Favored Lender Status....................................................................29
11. EVENTS OF DEFAULT......................................................................................30
12. REMEDIES ON DEFAULT, ETC...............................................................................33
12.1 Acceleration..................................................................................33
12.2 Other Remedies................................................................................34
12.3 Rescission....................................................................................34
12.4 No Waivers or Election of Remedies, Expenses, etc.............................................34
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES..........................................................34
13.1 Registration of Notes.........................................................................34
13.2 Transfer and Exchange of Notes................................................................35
13.3 Replacement of Notes..........................................................................35
14. PAYMENTS ON NOTES......................................................................................36
14.1 Place of Payment..............................................................................36
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TABLE OF CONTENTS
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(continued)
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14.2 Home Office Payment...........................................................................36
15. EXPENSES, ETC..........................................................................................36
15.1 Transaction Expenses..........................................................................36
15.2 Survival......................................................................................37
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT...........................................37
17. AMENDMENT AND WAIVER...................................................................................37
17.1 Requirements..................................................................................37
17.2 Solicitation of Holders of Notes..............................................................37
17.3 Binding Effect, etc...........................................................................38
17.4 Notes held by Company, etc....................................................................38
18. NOTICES................................................................................................38
19. REPRODUCTION OF DOCUMENTS..............................................................................39
20. CONFIDENTIAL INFORMATION...............................................................................39
21. SUBSTITUTION OF PURCHASER..............................................................................41
22. MISCELLANEOUS..........................................................................................41
22.1 Successors and Assigns........................................................................41
22.2 Payments Due on Non-Business Days.............................................................41
22.3 Severability..................................................................................41
22.4 Construction..................................................................................42
22.5 Counterparts..................................................................................42
22.6 Governing Law.................................................................................42
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Schedules and Exhibits
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Schedule A -- Information Relating to Purchasers
Schedule B -- Defined Terms
Schedule 3 -- Payment Instructions
Schedule 4.9 -- Changes in Corporate Structure
Schedule 5.3 -- Disclosure Materials
Schedule 5.4 -- Subsidiaries of the Company and Ownership of Subsidiary Stock
Schedule 5.5 -- Financial Statements
Schedule 5.12 -- Postretirement Benefit Obligations; ERISA Affiliates
Schedule 5.15 -- Existing Indebtedness and Liens
Schedule 10.3 -- Exclusions from Priority Debt
Exhibit 1A -- Form of 10% Series A-2009 Senior Note due February 13, 2017
Exhibit 1B -- Form of 10% Series B-2009 Senior Note due February 13, 2019
Exhibit 4.4(a) -- Form of Opinion of Special Counsel for Company and Guarantors
Exhibit 4.4(b) -- Form of Opinion of General Counsel for Company and Guarantors
Exhibit 4.4(c) -- Form of Opinion of Special Counsel for Purchasers
Exhibit 4.7 -- Form of Guaranty Agreement
▇▇▇▇▇▇▇ & CO.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
$125,000,000 10% SERIES A-2009 SENIOR NOTES DUE FEBRUARY 13, 2017
$125,000,000 10% SERIES B-2009 SENIOR NOTES DUE FEBRUARY 13, 2019
Dated as of February 12, 2009
To Each of The Purchasers Listed in Schedule A Hereto:
Ladies and Gentlemen:
▇▇▇▇▇▇▇ & CO., a Delaware corporation (together with its successors and
assigns, the "Company"), agrees with each of the purchasers whose names appear
at the end hereof (each, a "Purchaser" and, collectively, the "Purchasers"), as
follows::
1. AUTHORIZATION OF NOTES
The Company will authorize the issue and sale of (a) $125,000,000 aggregate
principal amount of its 10% Series A-2009 Senior Notes due February 13, 2017 (as
amended, restated or otherwise modified from time to time, together with any
such notes issued in substitution therefor pursuant to Section 13, the "Series A
Notes") and (b) $125,000,000 aggregate principal amount of its 10% Series B-2009
Senior Notes due February 13, 2019 (as amended, restated or otherwise modified
from time to time, together with any such notes issued in substitution therefor
pursuant to Section 13, the "Series B Notes", and together with the Series A
Notes, the "Notes"). The Series A Notes and the Series B Notes shall be
substantially in the form set out in Exhibit 1A and Exhibit 1B, respectively.
Certain capitalized and other terms used in this Agreement are defined in
Schedule B; references to a "Schedule" or an "Exhibit" are, unless otherwise
specified, to a Schedule or an Exhibit attached to this Agreement; and
references to a "Section" are, unless otherwise specified, references to a
Section of this Agreement.
2. SALE AND PURCHASE OF NOTES
Subject to the terms and conditions of this Agreement, the Company will
issue and sell each Purchaser and each Purchaser will purchase from the Company,
at the Closing provided for in Section 3, Notes of the Series and in the
principal amounts specified opposite such Purchaser's name in Schedule A at the
purchase price of 100% of the principal amount thereof. The Purchasers'
obligations hereunder are several and not joint obligations and no Purchaser
shall have any liability to any Person for the performance or non-performance of
any obligation by any other Purchaser hereunder.
3. CLOSING
The sale and purchase of the Notes to be purchased by each Purchaser shall
occur at the offices of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, at 10:00 a.m., local time, at a closing (the "Closing") on
February 12, 2009. At the Closing, the Company will deliver to each Purchaser
the Notes to be purchased by such Purchaser in the form of a single Note for
each Series of Notes to be purchased by such Purchaser (or such greater number
of Notes in denominations of at least $100,000 as such Purchaser may request),
dated the date of the Closing and registered in such Purchaser's name (or in the
name of its nominee), against delivery by such Purchaser to the Company or its
order of immediately available funds in the amount of the purchase price
therefore by wire transfer for the account of the Company to account number
8900149167 at Bank of New York, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, ABA Number:
▇▇▇-▇▇▇-▇▇▇, Account Name: ▇▇▇▇▇▇▇ & Co. If, at the Closing, the Company shall
fail to tender the Notes of any Series to any Purchaser as provided above in
this Section 3, or any of the conditions specified in Section 4 shall not have
been fulfilled to such Purchaser's satisfaction, such Purchaser shall, at its
election, be relieved of all further obligations under this Agreement, without
thereby waiving any rights such Purchaser may have by reason of such failure or
such nonfulfillment.
4. CONDITIONS TO CLOSING
Each Purchaser's obligation to purchase and pay for the Notes to be sold to
such Purchaser at the Closing is subject to the fulfillment to such Purchaser's
satisfaction, prior to or at the Closing, of the following conditions:
4.1 Representations and Warranties
The representations and warranties of the Company in this Agreement shall
be correct when made at the time of the Closing.
4.2 Performance; No Default
The Company and each of the Guarantors shall have performed and complied
with all agreements and conditions contained in the Financing Documents required
to be performed or complied with by the Company or such Guarantor prior to or at
the Closing, and, after giving effect to the issue and sale of the Notes (and
the application of the proceeds thereof as contemplated by Section 5.14), no
Default or Event of Default shall have occurred and be continuing.
4.3 Compliance Certificates
(a) Officer's Certificate. The Company shall have delivered to such
Purchaser an Officer's Certificate, dated the date of the Closing, certifying
that the conditions specified in Sections 4.1, 4.2 and 4.10 have been fulfilled.
(b) Company Secretary's Certificate. The Company shall have delivered to
each Purchaser a certificate, signed on its behalf by its Secretary or one of
its Assistant Secretaries, dated the date of the Closing, (i) certifying as to
the resolutions attached thereto and other corporate proceedings relating to the
authorization, execution and delivery of the Notes and this Agreement and (ii)
attaching a true and correct copy of the 2002 Note Agreement.
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(c) Guarantor Secretary's Certificates. Each of the Guarantors shall have
delivered to each Purchaser a certificate, signed on its behalf by its Secretary
or one of its Assistant Secretaries, dated the date of the Closing, certifying
as to the resolutions attached thereto and other corporate proceedings relating
to the authorization, execution and delivery of the Guaranty Agreement.
4.4 Opinions of Counsel
Each Purchaser shall have received opinions in form and substance
reasonably satisfactory to such Purchaser, dated the date of the Closing, from
(a) ▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, counsel for the Company and the
Guarantors, substantially in the form set out in Exhibit 4.4(a) and covering
such other matters incident to the transactions contemplated hereby as such
Purchaser or its counsel may reasonably request (and the Company hereby
instructs such counsel to deliver such opinion to such Purchaser), and
(b) ▇▇▇▇▇ ▇. ▇▇▇▇▇, Vice President - Legal of the Company and counsel to
the Guarantors, substantially in the form set out in Exhibit 4.4(b) and covering
such other matters incident to the transactions contemplated hereby as such
Purchaser or its counsel may reasonably request (and the Company hereby
instructs such counsel to deliver such opinion to such Purchaser), and
(c) ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ LLP, special counsel to the Purchasers, substantially
in the form set out in Exhibit 4.4(c) and covering such other matters as such
Purchaser may reasonably request.
4.5 Purchase Permitted By Applicable Law, etc
On the date of the Closing, such Purchaser's purchase of Notes shall (a) be
permitted by the laws and regulations of each jurisdiction to which such
Purchaser is subject, without recourse to provisions (such as section 1405(a)(8)
of the New York Insurance Law) permitting limited investments by insurance
companies without restriction as to the character of the particular investment,
(b) not violate any applicable law or regulation (including, without limitation,
Regulation T, U or X of the Board of Governors of the Federal Reserve System)
and (c) not subject such Purchaser to any tax, penalty or liability under or
pursuant to any applicable law or regulation, which law or regulation was not in
effect on the date hereof. If requested by such Purchaser, such Purchaser shall
have received an Officer's Certificate certifying as to such matters of fact as
such Purchaser may reasonably specify to enable such Purchaser to determine
whether such purchase is so permitted.
4.6 Sale of Other Notes
Contemporaneously with the Closing the Company shall sell to each other
Purchaser and each other Purchaser shall purchase from the Company the Notes to
be purchased by it at the Closing as specified in Schedule A.
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4.7 Guaranty Agreement
Each Purchaser shall have received a counterpart of the Guaranty Agreement,
duly executed and delivered by each of the Guarantors, substantially in the form
of Exhibit 4.7 (as amended or supplemented from time to time, the "Guaranty
Agreement"), and the Guaranty Agreement shall be in full force and effect.
4.8 Payment of Fees
Without limiting the provisions of Section 15.1, the Company shall have
paid on or before the Closing the reasonable fees, charges and disbursements of
the Purchasers' special counsel referred to in Section 4.4(c) to the extent
reflected in a statement of such counsel rendered to the Company at least one
Business Day prior to the Closing.
4.9 Private Placement Numbers
A Private Placement Number issued by Standard & Poor's CUSIP Service Bureau
(in cooperation with the Securities Valuation Office of the National Association
of Insurance Commissioners) shall have been obtained for the Notes of each
Series.
4.10 Changes in Corporate Structure
Except as specified in Schedule 4.10 or permitted pursuant to this
Agreement, the Company shall not have changed its jurisdiction of incorporation
or been a party to any merger or consolidation or succeeded to all or any
substantial part of the liabilities of any other entity, at any time following
the date of the most recent financial statements referred to in Schedule 5.5. or
delivered to the holders of the Notes pursuant to Section 7.1.
4.11 Proceedings and Documents
All corporate and other proceedings in connection with the transactions
contemplated by this Agreement and all documents and instruments incident to
such transactions shall be satisfactory to such Purchaser and its special
counsel, and such Purchaser and its special counsel shall have received all such
counterpart originals or certified or other copies of such documents as such
Purchaser or such special counsel may reasonably request.
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to each Purchaser that:
5.1 Organization; Power and Authority
The Company is a corporation duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation, and is duly
qualified as a foreign corporation and is in good standing in each jurisdiction
in which such qualification is required by law, other than those jurisdictions
as to which the failure to be so qualified or in good standing could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. The Company has the corporate power and authority to own or hold
under lease the properties it purports to own or hold under lease, to transact
the business it transacts and proposes to transact, to execute and deliver this
Agreement and the Notes and to perform the provisions hereof and thereof.
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5.2 Authorization, etc.
The Financing Documents have been duly authorized by all necessary
corporate action on the part of the Company and each of the Guarantors, and this
Agreement constitutes, and upon execution and delivery thereof each Note and the
Guaranty Agreement will constitute, a legal, valid and binding obligation of
each Obligor party thereto, enforceable against each such Obligor in accordance
with its terms, except as may be limited by (a) applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and (b) general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
5.3 Disclosure
The Company, through its agent, ▇▇ ▇▇▇▇▇▇ Securities, Inc., has delivered
to each Purchaser a copy of a Private Placement Memorandum, dated January, 2009
(the "Memorandum"), relating to the transactions contemplated hereby. This
Agreement, the Memorandum and the documents, certificates or other writings
delivered to the Purchasers by or on behalf of the Company in connection with
the transactions contemplated hereby and identified in Schedule 5.3 and the
financial statements listed in Schedule 5.5 (this Agreement, the Memorandum and
such documents, certificates or other writings and such financial statements
delivered to each Purchaser prior to February 5, 2009, being referred to,
collectively, as the "Disclosure Documents"), taken as a whole, do not contain
any untrue statement of a material fact or omit to state any material fact
necessary to make the statements herein or therein not misleading in light of
the circumstances under which they were made. Except as disclosed in the
Disclosure Documents or in the financial statements listed in Schedule 5.5 or as
expressly disclosed in Schedule 5.3, since January 31, 2008, there has been no
change in the financial condition, operations, business, properties or prospects
of the Company or any Subsidiary except changes that individually or in the
aggregate could not reasonably be expected to have a Material Adverse Effect.
There is no fact known to the Company that could reasonably be expected to have
a Material Adverse Effect that has not been set forth herein or in the
Disclosure Documents delivered to each Purchaser.
5.4 Organization and Ownership of Shares of Subsidiaries; Affiliates
(a) Schedule 5.4 contains (except as noted therein) complete and correct
lists of (i) the Company's Subsidiaries, showing, as to each Subsidiary, the
correct name thereof, the jurisdiction of its organization, and the percentage
of shares of each class of its Capital Stock outstanding owned by the Company
and each other Subsidiary and (ii) the Company's Affiliates, other than
Subsidiaries.
(b) All of the outstanding shares of Capital Stock of each Subsidiary shown
in Schedule 5.4 as being owned by the Company or its Subsidiaries have been
validly issued, are fully paid and nonassessable and are owned by the Company or
another Subsidiary free and clear of any Lien (except as otherwise disclosed in
Schedule 5.4).
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(c) Each Subsidiary identified in Schedule 5.4 is a corporation or other
legal entity duly organized, validly existing and in good standing under the
laws of its jurisdiction of organization, and is duly qualified as a foreign
corporation or other legal entity and is in good standing in each jurisdiction
in which such qualification is required by law, other than those jurisdictions
as to which the failure to be so qualified or in good standing could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. Each such Subsidiary has the corporate or other power and
authority to own or hold under lease the properties it purports to own or hold
under lease, to transact the business it transacts and proposes to transact, to
execute and deliver the Financing Documents to which it is a party and to
perform its obligations thereunder.
(d) No Subsidiary is a party to, or otherwise subject to any legal
restriction or any agreement (other than the agreements listed in Schedule 5.4
and customary limitations imposed by corporate law statutes) restricting the
ability of such Subsidiary to pay dividends out of profits or make any other
similar distributions of profits to the Company or any of its Subsidiaries that
owns outstanding shares of Capital Stock of such Subsidiary.
5.5 Financial Statements
The Company has delivered to each Purchaser copies of the consolidated
financial statements of the Company and its Subsidiaries listed in Schedule 5.5.
All of said consolidated financial statements (including in each case the
related schedules and notes) fairly present in all material respects the
consolidated financial position of the Company and its Subsidiaries as of the
respective dates specified in such Schedule and the consolidated results of
their operations and cash flows for the respective periods so specified and have
been prepared in accordance with GAAP consistently applied throughout the
periods involved except as set forth in the notes thereto (subject, in the case
of any interim financial statements, to normal year-end adjustments).
5.6 Compliance with Laws, Other Instruments, etc.
The execution, delivery and performance (i) by the Company of this
Agreement and the Notes, and (ii) by each of the Guarantors of the Guaranty
Agreement, will not
(a) contravene, result in any breach of, or constitute a default under, or
result in the creation of any Lien in respect of any property of the Company or
any Subsidiary under, any indenture, mortgage, deed of trust, loan, purchase or
credit agreement, lease, corporate charter or by-laws, or any other agreement or
instrument to which the Company or any Subsidiary is bound or by which the
Company or any Subsidiary or any of their respective properties may be bound or
affected,
(b) conflict with or result in a breach of any of the terms, conditions or
provisions of any order, judgment, decree, or ruling of any court, arbitrator or
Governmental Authority applicable to the Company or any Subsidiary, or
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(c) violate any provision of any statute or other rule or regulation of any
Governmental Authority applicable to the Company or any Subsidiary.
5.7 Governmental Authorizations, etc.
No consent, approval or authorization of, or registration, filing or
declaration with, any Governmental Authority is required to be obtained by the
Company or any of the Guarantors in connection with the execution, delivery or
performance (a) by the Company of this Agreement or the Notes, or (b) by each of
the Guarantors of the Guaranty Agreement.
5.8 Litigation; Observance of Agreements, Statutes and Orders
(a) There are no actions, suits or proceedings pending or, to the knowledge
of the Company, threatened against or affecting the Company or any Subsidiary or
any property of the Company or any Subsidiary in any court or before any
arbitrator of any kind or before or by any Governmental Authority that,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
(b) Neither the Company nor any Subsidiary is in default under any term of
any agreement or instrument to which it is a party or by which it is bound, or
any order, judgment, decree or ruling of any court, arbitrator or Governmental
Authority or is in violation of any applicable law, ordinance, rule or
regulation (including, without limitation, Environmental Laws) of any
Governmental Authority, which default or violation, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.
5.9 Taxes
The Company and its Subsidiaries have filed all tax returns that are
required to have been filed in any jurisdiction, and have paid all taxes shown
to be due and payable on such returns and all other taxes and assessments levied
upon them or their properties, assets, income or franchises, to the extent such
taxes and assessments have become due and payable and before they have become
delinquent, except for any taxes and assessments (a) the amount of which is not
individually or in the aggregate Material or (b) the amount, applicability or
validity of which is currently being contested in good faith by appropriate
proceedings and with respect to which the Company or a Subsidiary, as the case
may be, has established adequate reserves in accordance with GAAP. The Company
knows of no basis for any other tax or assessment that could reasonably be
expected to have a Material Adverse Effect. The charges, accruals and reserves
on the books of the Company and its Subsidiaries in respect of Federal, state or
other taxes for all fiscal periods are adequate. The Federal income tax
liabilities of the Company and its Subsidiaries subject to United States income
taxes have been determined by the Internal Revenue Service and paid for all
fiscal years up to and including the fiscal year ended January 31, 2008.
5.10 Title to Property; Leases
The Company and its Subsidiaries have good and sufficient title to their
respective properties that individually or in the aggregate are Material,
including all such properties reflected in the most recent audited balance sheet
referred to in Section 5.5 or purported to have been acquired by the Company or
any Subsidiary after said date (except as sold or otherwise disposed of in the
ordinary course of business), in each case free and clear of Liens prohibited by
this Agreement. All leases that individually or in the aggregate are Material
are valid and subsisting and are in full force and effect in all material
respects.
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5.11 Licenses, Permits, etc
(a) The Company and its Subsidiaries own or possess all licenses, permits,
franchises, authorizations, patents, copyrights, service marks, trademarks and
trade names, or rights thereto, that individually or in the aggregate are
Material, without known conflict with the rights of others;
(b) to the best knowledge of the Company, no product or practice of the
Company or any Subsidiary infringes in any material respect any license, permit,
franchise, authorization, patent, copyright, service ▇▇▇▇, trademark, trade name
or other right owned by any other Person; and
(c) to the best knowledge of the Company, there is no Material violation by
any Person of any right of the Company or any of its Subsidiaries with respect
to any patent, copyright, service ▇▇▇▇, trademark, trade name or other right
owned or used by the Company or any of its Subsidiaries.
5.12 Compliance with ERISA
(a) The Company and each ERISA Affiliate have operated and administered
each Plan in compliance with all applicable laws except for such instances of
noncompliance as have not resulted in and could not reasonably be expected to
result in a Material Adverse Effect. Neither the Company nor any ERISA Affiliate
has incurred any liability pursuant to Title I or IV of ERISA or the penalty or
excise tax provisions of the Code relating to employee benefit plans (as defined
in section 3 of ERISA), and no event, transaction or condition has occurred or
exists that could reasonably be expected to result in the incurrence of any such
liability by the Company or any ERISA Affiliate, or in the imposition of any
Lien on any of the rights, properties or assets of the Company or any ERISA
Affiliate, in either case pursuant to Title I or IV of ERISA or to such penalty
or excise tax provisions or to section 401(a)(29) or 412 of the Code, other than
such liabilities or Liens as would not be individually or in the aggregate
Material.
(b) The present value of the aggregate benefit liabilities under each of
the Plans (other than Multiemployer Plans), determined as of the end of such
Plan's most recently ended plan year for which audited financial statements are
available on the basis of the actuarial assumptions specified for funding
purposes in such Plan's most recent actuarial valuation report, did not exceed
the aggregate current value of the assets of such Plan allocable to such benefit
liabilities by more than $5,000,000. The term "benefit liabilities" has the
meaning specified in section 4001 of ERISA and the terms "current value" and
"present value" have the meaning specified in section 3 of ERISA.
(c) The Company and the ERISA Affiliates have not incurred withdrawal
liabilities (and are not subject to contingent withdrawal liabilities) under
section 4201 or 4204 of ERISA in respect of Multiemployer Plans that
individually or in the aggregate are Material.
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(d) Part I of Schedule 5.12 sets forth the expected postretirement benefit
obligations of the Company and its Subsidiaries determined as of the last day of
the Company's most recently ended fiscal year for which audited financial
statements are available in accordance with Financial Accounting Standards Board
Statement No. 106, without regard to liabilities attributable to continuation
coverage mandated by section 4980B of the Code.
(e) The execution and delivery of the Financing Documents and the issuance
and sale of the Notes hereunder will not involve any transaction that is subject
to the prohibitions of section 406 of ERISA or in connection with which a tax
could be imposed pursuant to section 4975(c)(1)(A)-(D) of the Code. The
representation by the Company in the first sentence of this Section 5.12(e) is
made in reliance upon and subject to the accuracy of each Purchaser's
representation in Section 6.2 as to the Sources used to pay the purchase price
of the Notes to be purchased by such Purchaser.
(f) Part II of Schedule 5.12 sets forth all ERISA Affiliates and all
"employee benefit plans" maintained by the Company (or any "affiliate" thereof)
or in respect of which the Notes could constitute an "employer security"
("employee benefit plan" has the meaning specified in section 3 of ERISA,
"affiliate" has the meaning specified in section 407(d) of ERISA and section V
of the Department of Labor Prohibited Transaction Exemption 95-60 (60 FR 35925,
July 12, 1995) and "employer security" has the meaning specified in section
407(d) of ERISA).
(g) All Foreign Pension Plans have been established, operated, administered
and maintained in compliance with all laws, regulations and orders applicable
thereto except for such failures to comply, in the aggregate for all such
failures, that could not reasonably be expected to have a Material Adverse
Effect. All premiums, contributions and any other amounts required by applicable
Foreign Pension Plan documents or applicable laws have been paid or accrued as
required, except for premiums, contributions and amounts that, in the aggregate
for all such obligations, could not reasonably be expected to have a Material
Adverse Effect.
5.13 Private Offering by the Company
Neither the Company nor anyone acting on its behalf has offered the Notes
for sale to, or solicited any offer to buy any of the same from, or otherwise
approached or negotiated in respect thereof with, any Person other than the
Purchasers and, not more than 7 other Institutional Investors, each of which has
been offered the Notes at a private sale for investment. Neither the Company nor
anyone acting on its behalf has taken, or will take, any action that would
subject the issuance or sale of the Notes to the registration requirements of
section 5 of the Securities Act. For purposes of this Section 5.13 only, each
reference to the Notes shall be deemed to include a reference to the Guaranty
Agreement.
5.14 Use of Proceeds; Margin Regulations
The Company will apply the proceeds of the sale of the Notes as set forth
in "The Offering and Use of Proceeds" section of the Memorandum. No part of the
proceeds from the sale of the Notes hereunder will be used, directly or
indirectly, for the purpose of buying or carrying any margin stock within the
meaning of Regulation U of the Board of Governors of the Federal Reserve System
(12 CFR 221), or for the purpose of buying or carrying or trading in any
securities under such circumstances as to involve the Company in a violation of
Regulation X of said Board (12 CFR 224) or to involve any broker or dealer in a
violation of Regulation T of said Board (12 CFR 220). Margin stock does not
constitute more than 25% of the value of the consolidated assets of the Company
and its Subsidiaries and the Company does not have any present intention that
margin stock will constitute more than 25% of the value of such assets. As used
in this Section, the terms "margin stock" and "purpose of buying or carrying"
shall have the meanings assigned to them in said Regulation U.
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5.15 Existing Indebtedness; Future Liens
(a) Except as described therein, Schedule 5.15 sets forth a complete and
correct list of all outstanding Indebtedness of the Company and its Subsidiaries
as of the dates specified in such Schedule (and specifying, as to each such
Indebtedness, the collateral, if any, securing such Indebtedness), since which
date there has been no Material change in the amounts, interest rates, sinking
funds, installment payments or maturities of the Indebtedness of the Company or
its Subsidiaries. Neither the Company nor any Subsidiary is in default and no
waiver of default is currently in effect, in the payment of any principal or
interest on any Indebtedness of the Company or such Subsidiary and no event or
condition exists with respect to any Indebtedness of the Company or any
Subsidiary that would permit (or that with notice or the lapse of time, or both,
would permit) one or more Persons to cause such Indebtedness to become due and
payable before its stated maturity or before its regularly scheduled dates of
payment.
(b) Except as disclosed in Schedule 5.15, neither the Company nor any
Subsidiary has agreed or consented to cause or permit in the future (upon the
happening of a contingency or otherwise) any of its property, whether now owned
or hereafter acquired, to be subject to a Lien not permitted by Section 10.4.
5.16 Foreign Assets Control Regulations, etc.
(a) Neither the sale of the Notes by the Company hereunder nor its use of
the proceeds thereof will violate the Trading with the Enemy Act, as amended, or
any of the foreign assets control regulations of the United States Treasury
Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling
legislation or executive order relating thereto.
(b) Neither the Company nor any of its Subsidiaries has violated the
provisions of United States Executive Order 13224 of September 24, 2001 Blocking
Property and Prohibiting Transactions With Persons Who Commit, Threaten to
Commit, or Support Terrorism (Exec. Order No. 13,224, 66 Fed. Reg. 49,079
(2001)) (the "Anti-Terrorism Order") or the provisions of Public Law 107-56 (USA
Patriot Act).
5.17 Status under Certain Statutes
Neither the Company nor any Subsidiary is subject to regulation under
the Investment Company Act of 1940, as amended, the Public Utility Holding
Company Act of 2005, as amended, the ICC Termination Act of 1995, as amended, or
the Federal Power Act, as amended.
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5.18 Environmental Matters
Neither the Company nor any Subsidiary has knowledge of any claim or has
received any notice of any claim, and no proceeding has been instituted raising
any claim against the Company or any of its Subsidiaries or any of their
respective real properties now or formerly owned, leased or operated by any of
them or other assets, alleging any damage to the environment or violation of any
Environmental Laws, except, in each case, such as could not reasonably be
expected to result in a Material Adverse Effect. Except as otherwise disclosed
to each Purchaser in writing,
(a) neither the Company nor any Subsidiary has knowledge of any facts which
would give rise to any claim, public or private, of violation of Environmental
Laws or damage to the environment emanating from, occurring on or in any way
related to real properties now or formerly owned, leased or operated by any of
them or to other assets or their use, except, in each case, such as could not
reasonably be expected to result in a Material Adverse Effect;
(b) neither the Company nor any of its Subsidiaries has stored any
Hazardous Materials on real properties now or formerly owned, leased or operated
by any of them or disposed of any Hazardous Materials in a manner contrary to
any Environmental Laws in each case in any manner that could reasonably be
expected to result in a Material Adverse Effect; and
(c) all buildings on all real properties now owned, leased or operated by
the Company or any of its Subsidiaries are in compliance with applicable
Environmental Laws, except where failure to comply could not reasonably be
expected to result in a Material Adverse Effect.
6. REPRESENTATIONS OF THE PURCHASERS
Each Purchaser represents as follows:
6.1 Purchase for Investment
Each Purchaser severally represents that it is purchasing the Notes for its
own account or for one or more separate accounts maintained by such Purchaser or
for the account of one or more pension or trust funds and not with a view to the
distribution thereof, provided that the disposition of such Purchaser's property
or their property shall at all times be within such Purchaser's or their
control. Such Purchaser understands that the Notes have not been registered
under the Securities Act and may be resold only if registered pursuant to the
provisions of the Securities Act or if an exemption from registration is
available, except under circumstances where neither such registration nor such
an exemption is required by law, and that the Company is not required to
register the Notes.
6.2 Source of Funds
Each Purchaser severally represents that at least one of the following
statements is an accurate representation as to each source of funds (a "Source")
to be used by such Purchaser to pay the purchase price of the Notes to be
purchased by such Purchaser hereunder:
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(a) the Source is an "insurance company general account" as defined in
United States Department of Labor Prohibited Transaction Exemption ("PTE") 95-60
(60 FR 35925, July 12, 1995) and in respect thereof such Purchaser represents
that there is no "employee benefit plan" (as defined in section 3(3) of ERISA
and section 4975(e)(1) of the Code, treating as a single plan all plans
maintained by the same employer or employee organization or affiliate thereof)
with respect to which the amount of the general account reserves and liabilities
of all contracts held by or on behalf of such plan exceeds 10% of the total
reserves and liabilities of such general account (exclusive of separate account
liabilities) plus surplus, as set forth in the National Association of Insurance
Commissioners' Annual Statement filed with such Purchaser's state of domicile;
or
(b) if any Purchaser is an insurance company, the Source does not include
assets allocated to any separate account maintained by such Purchaser in which
any employee benefit plan (or its related trust) has any interest, other than a
separate account that is maintained solely in connection with such Purchaser's
fixed contractual obligations under which the amounts payable, or credited, to
such plan and to any participant or beneficiary of such plan (including any
annuitant) are not affected in any manner by the investment performance of the
separate account; or
(c) the Source is either (i) an insurance company pooled separate account,
within the meaning of PTE 90-1 (issued January 29, 1990), or (ii) a bank
collective investment fund, within the meaning of the PTE 91-38 (issued July 12,
1991) and, except as such Purchaser has disclosed to the Company in writing
pursuant to this paragraph (c), no employee benefit plan or group of plans
maintained by the same employer or employee organization beneficially owns more
than 10% of all assets allocated to such pooled separate account or collective
investment fund; or
(d) the Source constitutes assets of an "investment fund" (within the
meaning of part V of PTE 84-14 (the "QPAM Exemption")) managed by a "qualified
professional asset manager" or "QPAM" (within the meaning of part V of the QPAM
Exemption), no employee benefit plan's assets that are included in such
investment fund, when combined with the assets of all other employee benefit
plans established or maintained by the same employer or by an affiliate (within
the meaning of section V(c)(1) of the QPAM Exemption) of such employer or by the
same employee organization and managed by such QPAM, exceed 20% of the total
client assets managed by such QPAM, the conditions of part I(c) and (g) of the
QPAM Exemption are satisfied, neither the QPAM nor a person controlling or
controlled by the QPAM (applying the definition of "control" in section V(e) of
the QPAM Exemption) owns a 5% or more interest in the Company and
(i) the identity of such QPAM and
(ii) the names of all employee benefit plans whose assets are included
in such investment fund
have been disclosed to the Company in writing pursuant to this paragraph
(d); or
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(e) the Source is a governmental plan; or
(f) the Source is one or more employee benefit plans, or a separate account
or trust fund comprised of one or more employee benefit plans, each of which has
been identified to the Company in writing pursuant to this paragraph (f); or
(g) the Source does not include assets of any employee benefit plan, other
than a plan exempt from the coverage of ERISA.
As used in this Section 6.2, the terms "employee benefit plan", "governmental
plan" and "separate account" shall have the respective meanings assigned to such
terms in section 3 of ERISA.
7. INFORMATION AS TO COMPANY
7.1 Financial and Business Information
The Company shall deliver to each holder of Notes that is an Institutional
Investor:
(a) Quarterly Statements -- within 60 days after the end of each quarterly
fiscal period in each fiscal year of the Company (other than the last quarterly
fiscal period of each such fiscal year), duplicate copies of,
(i) a consolidated balance sheet of the Company and its Subsidiaries
as at the end of such quarter, and
(ii) consolidated statements of earnings, stockholders' equity and
cash flows of the Company and its Subsidiaries, for such quarter and (in
the case of the second and third quarters) for the portion of the fiscal
year ending with such quarter,
setting forth in each case in comparative form the figures for the
corresponding periods in the previous fiscal year, all in reasonable
detail, prepared in accordance with GAAP applicable to quarterly financial
statements generally, and certified on behalf of the Company by a Senior
Financial Officer as fairly presenting, in all material respects, the
consolidated financial position of the companies being reported on and
their consolidated results of operations and cash flows, subject to changes
resulting from year-end adjustments, provided that posting on its official
website or delivery within the time period specified above of copies of the
Company's Quarterly Report on Form 10-Q (including copies of each exhibit
filed therewith) prepared in compliance with the requirements therefor and
filed with the Securities and Exchange Commission shall be deemed to
satisfy the requirements of this Section 7.1(a) so long as such Report
includes each of the financial statements (and the comparative historical
figures) referred to above, provided, however, that any such report or
document as contemplated by this Section 7.1(a) which has been posted to
the Company's official website with general access rights for the public
shall be deemed to have been delivered to the holders of Notes as
contemplated by this Section 7.1(a) so long as the Company has provided
each holder of Notes prior notice, by electronic mail to the electronic
13
address provided by such holder of Notes, of such posting;
(b) Annual Statements -- within 120 days after the end of each fiscal year
of the Company, duplicate copies of,
(i) a consolidated balance sheet of the Company and its Subsidiaries,
as at the end of such year, and
(ii) consolidated statements of earnings, stockholders' equity and
cash flows of the Company and its Subsidiaries, for such year,
setting forth in each case in comparative form the figures for the previous
fiscal year, all in reasonable detail, prepared in accordance with GAAP,
and accompanied by
(A) an opinion thereon of independent certified public
accountants of recognized national standing, which opinion shall state
that such financial statements present fairly, in all material
respects, the consolidated financial position of the companies being
reported upon and their consolidated results of operations and cash
flows and have been prepared in conformity with GAAP, and that the
examination of such accountants in connection with such financial
statements has been made in accordance with generally accepted
auditing standards, and that such audit provides a reasonable basis
for such opinion in the circumstances, and
(B) a certificate of such accountants stating that they have
reviewed this Agreement and stating further whether, in making their
audit, they have become aware of any condition or event that then
constitutes a Default or an Event of Default, and, if they are aware
that any such condition or event then exists, specifying the nature
and period of the existence thereof (it being understood that such
accountants shall not be liable, directly or indirectly, for any
failure to obtain knowledge of any Default or Event of Default unless
such accountants should have obtained knowledge thereof in making an
audit in accordance with generally accepted auditing standards or did
not make such an audit),
provided that posting on its official website or delivery within the time
period specified above of the Company's Annual Report on Form 10-K
(including copies of each exhibit filed therewith) for such fiscal year
prepared in accordance with the requirements therefor and filed with the
Securities and Exchange Commission, together with the accountant's
certificate described in clause (B) above, shall be deemed to satisfy the
requirements of this Section 7.1(b), so long as such Report includes each
of the financial statements (and the comparative historical figures)
referred to above, provided, however, that any such report or document as
contemplated by this Section 7.1(b) which has been posted to the Company's
official website with general access rights for the public shall be deemed
to have been delivered to the holders of Notes as contemplated by this
Section 7.1(b) so long as the Company has provided each holder of Notes
prior notice, by electronic mail to the electronic address provided by such
14
holder of Notes, of such posting;
(c) SEC and Other Reports -- promptly upon their becoming available, one
copy of (i) each financial statement, annual report (including, without
limitation, the Company's annual report to shareholders, if any, prepared
pursuant to Rule 14a-3 under the Exchange Act), notice or proxy statement sent
by the Company or any Subsidiary to public securities holders generally, and
(ii) each regular or periodic report, each registration statement (without
exhibits except as expressly requested by such holder), and each prospectus and
all amendments thereto filed by the Company or any Subsidiary with the
Securities and Exchange Commission and of all press releases and other
statements made available generally by the Company or any Subsidiary to the
public concerning developments that are Material, provided that posting on its
official website of any such report or document shall be deemed to satisfy the
requirements of this Section 7.1(c), provided, however, that any such report or
document as contemplated by this Section 7.1(c) which has been posted to the
Company's official website with general access rights for the public shall be
deemed to have been delivered to the holders of Notes as contemplated by this
Section 7.1(c) so long as the Company has provided each holder of Notes prior
notice, by electronic mail to the electronic address provided by such holder of
Notes, of such posting;
(d) Notice of Default or Event of Default -- promptly, and in any event
within five days after a Responsible Officer becoming aware of the existence of
any Default or Event of Default or that any Person has given any notice or taken
any action with respect to a claimed default hereunder or that any Person has
given any notice or taken any action with respect to a claimed default of the
type referred to in Section 11(f), a written notice specifying the nature and
period of existence thereof and what action the Company is taking or proposes to
take with respect thereto;
(e) ERISA Matters -- promptly, and in any event within five days after a
Responsible Officer becoming aware of any of the following, a written notice
setting forth the nature thereof and the action, if any, that the Company or an
ERISA Affiliate proposes to take with respect thereto:
(i) with respect to any Plan, any reportable event, as defined in
section 4043(c) of ERISA and the regulations thereunder, for which notice
thereof has not been waived pursuant to such regulations as in effect on
the date of the Closing; or
(ii) the taking by the PBGC of steps to institute, or the threatening
by the PBGC of the institution of, proceedings under section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any
Plan, or the receipt by the Company or any ERISA Affiliate of a notice from
a Multiemployer Plan that such action has been taken by the PBGC with
respect to such Multiemployer Plan; or
(iii) any event, transaction or condition that could result in the
incurrence of any liability by the Company or any ERISA Affiliate pursuant
to Title I or IV of ERISA or the penalty or excise tax provisions of the
Code relating to employee benefit plans, or in the imposition of any Lien
on any of the rights, properties or assets of the Company or any ERISA
Affiliate pursuant to Title I or IV of ERISA or such penalty or excise tax
provisions, if such liability or Lien, taken together with any other such
liabilities or Liens then existing, could reasonably be expected to have a
Material Adverse Effect;
15
(f) Notices from Governmental Authority -- promptly, and in any event
within 30 days of receipt thereof, copies of any notice to the Company or any
Subsidiary from any Federal or state Governmental Authority relating to any
order, ruling, statute or other law or regulation that could reasonably be
expected to have a Material Adverse Effect; and
(g) Requested Information --- with reasonable promptness, such other data
and information relating to the business, operations, affairs, financial
condition, assets or properties of the Company or any of its Subsidiaries or
relating to the ability of the Obligors to perform their obligations under the
Financing Documents as from time to time may be reasonably requested by any such
holder of Notes, or such information regarding the Company required to satisfy
the requirements of 17 C.F.R. ss.230.144A, as amended from time to time, in
connection with any contemplated transfer of the Notes.
7.2 Officer's Certificate
Each set of financial statements delivered to a holder of Notes pursuant to
Section 7.1(a) or Section 7.1(b) hereof shall be accompanied by an Officer's
Certificate signed by a Senior Financial Officer setting forth:
(a) Covenant Compliance -- the information (including detailed
calculations) required in order to establish whether the Company was in
compliance with the requirements of Sections 10.3 through 10.6, inclusive,
during the quarterly or annual period covered by the statements then being
furnished (including with respect to each such Section, where applicable, the
calculations of the maximum or minimum amount, ratio or percentage, as the case
may be, permissible under the terms of such Sections, and the calculation of the
amount, ratio or percentage then in existence); and
(b) Event of Default -- a statement that such officer has reviewed the
relevant terms hereof and has made, or caused to be made, under his or her
supervision, a review of the transactions and conditions of the Company and its
Subsidiaries from the beginning of the quarterly or annual period covered by the
statements then being furnished to the date of the certificate and that such
review has not disclosed the existence during such period of any condition or
event that constitutes a Default or an Event of Default or, if any such
condition or event existed or exists (including, without limitation, any such
event or condition resulting from the failure of the Company or any Subsidiary
to comply with any Environmental Law), specifying the nature and period of
existence thereof and what action the Company shall have taken or proposes to
take with respect thereto.
7.3 Inspection
The Company shall permit the representatives of each holder of Notes that
is an Institutional Investor:
(a) No Default -- if no Default or Event of Default then exists, at the
expense of such holder and upon reasonable prior notice to the Company, to visit
the principal executive office of the Company, to discuss the affairs, finances
and accounts of the Company and its Subsidiaries with the Company's officers,
and (with the consent of the Company, which consent will not be unreasonably
withheld) its independent public accountants, and (with the consent of the
Company, which consent will not be unreasonably withheld) to visit the other
offices and properties of the Company and each Subsidiary, all at such
reasonable times and as often as may be reasonably requested in writing; and
(b) Default -- if a Default or Event of Default then exists, at the expense
of the Company, to visit and inspect any of the offices or properties of the
Company or any Subsidiary, to examine all their respective books of account,
records, reports and other papers, to make copies and extracts therefrom, and to
discuss their respective affairs, finances and accounts with their respective
officers and independent public accountants (and by this provision the Company
authorizes said accountants to discuss the affairs, finances and accounts of the
Company and its Subsidiaries), all at such times and as often as may be
requested.
16
8. PAYMENT OF THE NOTES
8.1 Interest Rates
Interest on the Notes shall accrue on the unpaid principal balance of the
Notes at the rates and shall be computed on the basis as described in the Notes.
Interest shall be due and payable as provided in the Notes.
8.2 Required Principal Prepayments; Payment at Maturity
There are no required prepayments of principal in respect of the Notes. The
entire principal amount of the Series A Notes outstanding on February 13, 2017,
together with all accrued and unpaid interest thereon, shall be due and payable
on such date, and the entire principal amount of the Series B Notes outstanding
on February 13, 2019, together with all accrued and unpaid interest thereon,
shall be due and payable on such date.
8.3 Optional Prepayments with Make-Whole Amount
The Company may, at its option, upon notice as provided below, prepay at
any time all, or from time to time any part of, the Notes (but if in part, in
integral multiples of $100,000 and in an amount not less than $1,000,000 or such
lesser amount as shall then be outstanding), at 100% of the principal amount so
prepaid, together with accrued unpaid interest on such amount, plus the
Make-Whole Amount determined for the prepayment date with respect to such
principal amount. The Company will give each holder of Notes written notice of
each optional prepayment under this Section 8.3 not less than 30 days and not
more than 60 days prior to the date fixed for such prepayment. Each such notice
shall specify such prepayment date (which shall be a Business Day), the
aggregate principal amount of the Notes to be prepaid on such date, the
principal amount of each Note held by such holder to be prepaid (determined in
accordance with Section 8.4), and the interest to be paid on the prepayment date
with respect to such principal amount being prepaid, and shall be accompanied by
an Officer's Certificate signed by a Senior Financial Officer as to the
estimated Make-Whole Amount due in connection with such prepayment (calculated
as if the date of such notice were the date of the prepayment), setting forth
the details of such computation. Two Business Days prior to such prepayment, the
Company shall deliver to each holder of Notes an Officer's Certificate signed by
a Senior Financial Officer specifying the calculation of such Make-Whole Amount
as of the specified prepayment date.
17
8.4 Allocation of Partial Prepayments
In the case of each partial optional prepayment of the Notes, the principal
amount of the Notes to be prepaid shall be applied to the payment due at
maturity. In the case of each partial optional prepayment of the Notes, the
principal amount of the Notes to be prepaid shall be allocated among all of the
Notes at the time outstanding in proportion, as nearly as practicable, to the
respective unpaid principal amounts thereof not theretofore called for
prepayment.
8.5 Maturity; Surrender, etc
In the case of each prepayment of Notes pursuant to this Section 8, the
principal amount of each Note to be prepaid shall mature and become due and
payable on the date fixed for such prepayment (which shall be a Business Day),
together with interest on such principal amount accrued to such date and the
applicable Make-Whole Amount, if any. From and after such date, unless the
Company shall fail to pay such principal amount when so due and payable,
together with the interest and Make-Whole Amount, if any, as aforesaid, interest
on such principal amount shall cease to accrue. Any Note paid or prepaid in full
shall be surrendered to the Company and cancelled and shall not be reissued, and
no Note shall be issued in lieu of any prepaid principal amount of any Note.
8.6 No Other Optional Prepayments or Purchase of Notes
The Company will not, and will not permit any Affiliate to, prepay (whether
directly or indirectly by purchase, redemption or other acquisition) any of the
outstanding Notes except upon the payment or prepayment of the Notes in
accordance with the terms of this Section 8. The Company will promptly cancel
all Notes acquired by it or any Affiliate pursuant to any payment, prepayment or
purchase of Notes pursuant to any provision of this Section 8 and no Notes may
be issued in substitution or exchange for any such Notes.
8.7 Make-Whole Amount
The term "Make-Whole Amount" means, with respect to any Note, an amount
equal to the excess, if any, of the Discounted Value of the Remaining Scheduled
Payments with respect to the Called Principal of such Note over the amount of
such Called Principal, provided that the Make-Whole Amount may in no event be
less than zero. For the purposes of determining the Make-Whole Amount, the
following terms have the following meanings:
"Called Principal" means, with respect to any Note, the principal of such
Note that is to be prepaid pursuant to Section 8.3 or has become or is declared
to be immediately due and payable pursuant to Section 12.1, as the context
requires.
"Discounted Value" means, with respect to the Called Principal of any Note,
the amount obtained by discounting all Remaining Scheduled Payments with respect
to such Called Principal from their respective scheduled due dates to the
Settlement Date with respect to such Called Principal, in accordance with
accepted financial practice and at a discount factor (applied on the same
periodic basis as that on which interest on the Notes is payable) equal to the
Reinvestment Yield with respect to such Called Principal.
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"Reinvestment Yield" means, with respect to the Called Principal of any
Note, the sum of 0.25% per annum plus the yield to maturity implied by (a) the
yields reported, as of 10:00 A.M. (New York City time) on the second Business
Day preceding the Settlement Date with respect to such Called Principal, on the
display designated as Page "PX1" on the Bloomberg Financial Market Service (or
such other display as may replace Page "PX1" on the Bloomberg Financial Market
Service) for actively traded U.S. Treasury securities having a maturity equal to
the Remaining Average Life of such Called Principal as of such Settlement Date,
or (b) if such yields are not reported as of such time or the yields reported as
of such time are not ascertainable (including by way of interpolation), the
Treasury Constant Maturity Series Yields reported, for the latest day for which
such yields have been so reported as of the second Business Day preceding the
Settlement Date with respect to such Called Principal, in Federal Reserve
Statistical Release H.15 (519) (or any comparable successor publication) for
actively traded U.S. Treasury securities having a constant maturity equal to the
Remaining Average Life of such Called Principal as of such Settlement Date. Such
implied yield will be determined, if necessary, by (i) converting U.S. Treasury
▇▇▇▇ quotations to bond-equivalent yields in accordance with accepted financial
practice and (ii) interpolating linearly between (A) the actively traded U.S.
Treasury security with the maturity closest to and greater than the Remaining
Average Life and (B) the actively traded U.S. Treasury security with the
maturity closest to and less than the Remaining Average Life.
"Remaining Average Life" means, with respect to any Called Principal, the
number of years (calculated to the nearest one-twelfth year) obtained by
dividing (a) such Called Principal into (b) the sum of the products obtained by
multiplying (i) the principal component of each Remaining Scheduled Payment with
respect to such Called Principal by (ii) the number of years (calculated to the
nearest one-twelfth year) that will elapse between the Settlement Date with
respect to such Called Principal and the scheduled due date of such Remaining
Scheduled Payment.
"Remaining Scheduled Payments" means, with respect to the Called Principal
of any Note, all payments of such Called Principal and interest thereon that
would be due after the Settlement Date with respect to such Called Principal if
no payment of such Called Principal were made prior to its scheduled due date,
provided that if such Settlement Date is not a date on which interest payments
are due to be made under the terms of such Note, then the amount of the next
succeeding scheduled interest payment will be reduced by the amount of interest
accrued to such Settlement Date and required to be paid on such Settlement Date
pursuant to Section 8.3 or 12.1.
"Settlement Date" means, with respect to the Called Principal of any
Note, the date on which such Called Principal is to be prepaid pursuant to
Section 8.3 or has become or is declared to be immediately due and payable
pursuant to Section 12.1, as the context requires.
9. AFFIRMATIVE COVENANTS
The Company covenants that so long as any of the Notes are outstanding:
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9.1 Compliance with Law
The Company will and will cause each of its Subsidiaries to comply with all
laws, ordinances or governmental rules or regulations to which each of them is
subject, including, without limitation, Environmental Laws, the Anti-Terrorism
Order and Public Law 107-56 (USA Patriot Act), and will obtain and maintain in
effect all licenses, certificates, permits, franchises and other governmental
authorizations necessary to the ownership of their respective properties or to
the conduct of their respective businesses, in each case to the extent necessary
to ensure that non-compliance with such laws, ordinances or governmental rules
or regulations or failures to obtain or maintain in effect such licenses,
certificates, permits, franchises and other governmental authorizations could
not, individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
9.2 Insurance
The Company will and will cause each of its Subsidiaries to maintain, with
financially sound and reputable insurers, insurance with respect to their
respective properties and businesses against such casualties and contingencies,
of such types, on such terms and in such amounts (including deductibles,
co-insurance and self-insurance, if adequate reserves are maintained with
respect thereto) as is customary in the case of entities of established
reputations engaged in the same or a similar business and similarly situated.
9.3 Maintenance of Properties
The Company will and will cause each of its Subsidiaries to maintain and
keep, or cause to be maintained and kept, their respective properties in good
repair, working order and condition (other than ordinary wear and tear), so that
the business carried on in connection therewith may be properly conducted at all
times, provided that this Section shall not prevent the Company or any
Subsidiary from discontinuing the operation and the maintenance of any of its
properties if the Company has concluded that such discontinuance is desirable in
the conduct of its business and that such discontinuance could not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
9.4 Payment of Taxes and Claims
The Company will and will cause each of its Subsidiaries to file all tax
returns required to be filed in any jurisdiction and to pay and discharge all
taxes shown to be due and payable on such returns and all other taxes,
assessments, governmental charges, or levies imposed on them or any of their
properties, assets, income or franchises, to the extent such taxes, assessments,
charges or levies have become due and payable and before they have become
delinquent and all claims for which sums have become due and payable that have
or might become a Lien on properties or assets of the Company or any Subsidiary,
provided that neither the Company nor any Subsidiary need pay any such tax or
assessment or claims if (a) the amount, applicability or validity thereof is
contested by the Company or such Subsidiary on a timely basis in good faith and
in appropriate proceedings, and the Company or a Subsidiary has established
adequate reserves therefor in accordance with GAAP on the books of the Company
or such Subsidiary or (b) the nonpayment of all such taxes, assessments, charges
and levies in the aggregate could not reasonably be expected to have a Material
Adverse Effect.
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9.5 Corporate Existence, etc
Subject to Section 10.5(c), the Company will at all times preserve and keep
in full force and effect its corporate existence. Subject to Sections 10.5 and
10.6, the Company will at all times preserve and keep in full force and effect
the corporate existence of each of its Subsidiaries (unless merged into the
Company or a Subsidiary) and all rights and franchises of the Company and its
Subsidiaries unless, in the good faith judgment of the Company, the termination
of or failure to preserve and keep in full force and effect such corporate
existence, right or franchise could not, individually or in the aggregate, have
a Material Adverse Effect.
9.6 Subsequent Guarantors
The Company covenants that if at any time after the date of this Agreement
any Subsidiary which is not already a Guarantor at such time, shall be or become
a party to a Guaranty (whether as a borrower or an obligor) of all or any part
of the Indebtedness of the Company or its Subsidiaries under, or in respect of,
the Credit Agreement, the Company will cause each such Subsidiary,
contemporaneously with entering into any such Guaranty (and in any event no
later than 30 days thereafter), to execute and deliver to the holders of the
Notes (a) a Guaranty of the Company's obligations under the Notes and this
Agreement, in substantially the form of the Guaranty Agreement attached as
Exhibit 4.7 to this Agreement to the extent permitted under local law, and (b)
to the extent an opinion of counsel is delivered with respect to such Guaranty
of such Indebtedness under, or in respect of, the Credit Agreement, an opinion
of counsel for such Subsidiary with respect to such Guaranty in substantially
the form of the opinion of counsel so delivered under, or in respect of, the
Credit Agreement.
10. NEGATIVE COVENANTS
The Company covenants that so long as any of the Notes are outstanding:
10.1 Transactions with Affiliates
The Company will not, and will not permit any Subsidiary to, enter into
directly or indirectly any transaction or group of related transactions
(including, without limitation, the purchase, lease, sale or exchange of
properties of any kind or the rendering of any service) with any Affiliate
(other than the Company or another Subsidiary), except pursuant to the
reasonable requirements of the Company's or such Subsidiary's business and upon
fair and reasonable terms no less favorable to the Company or such Subsidiary
than would be obtainable in a comparable arm's-length transaction with a Person
not an Affiliate.
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10.2 Line of Business
The Company will not, and will not permit any of its Subsidiaries to,
engage in any business if, as a result, the general nature of the business in
which the Company and its Subsidiaries, taken as a whole, would then be engaged
would be substantially changed from the general nature of the business in which
the Company and its Subsidiaries, taken as a whole, are engaged on the date of
this Agreement as described in the then most recent Annual Report on Form 10-K
filed with the Securities and Exchange Commission, except for vertical,
horizontal or geographical expansion of any such business so engaged in, whether
under the ▇▇▇▇▇▇▇ & Co. name or any other name. Any such expansion may include,
but shall not be limited to, additional manufacturing of jewelry products,
trading in and processing of diamonds and the acquisition/operation of
additional retail operations under other tradenames.
10.3 Limitation on Debt
(a) Incurrence of Debt. The Company will not, and will not permit any
Subsidiary to, directly or indirectly, create, incur, assume, guarantee, or
otherwise become directly or indirectly liable with respect to, any Debt, unless
on the date the Company or such Subsidiary becomes liable with respect to any
such Debt and immediately after giving effect thereto and the concurrent
retirement of any other Debt,
(i) no Default or Event of Default would exist,
(ii) Consolidated Total Debt would not exceed 60% of Consolidated
Total Capitalization, and
(iii) the Fixed Charge Coverage Ratio in respect of such Debt at such
time would be greater than or equal to 2.0 to 1.0.
(b) Incurrence of Priority Debt. The Company will not, and will not permit
any Subsidiary to, directly or indirectly, create, incur, assume, guarantee, or
otherwise become directly or indirectly liable with respect to, any Priority
Debt, unless on the date the Company or such Subsidiary becomes liable with
respect to any such Priority Debt and immediately after giving effect thereto
and the concurrent retirement of any other Priority Debt,
(i) no Default or Event of Default would exist; and
(ii) Priority Debt would not exceed 20% of Consolidated Net Worth.
(c) Deemed Incurrence. For the purposes of this Section 10.3, any Person
becoming a Subsidiary after the date hereof shall be deemed, at the time it
becomes a Subsidiary, to have incurred all of its then outstanding Debt, and any
Person extending, renewing or refunding any Debt shall be deemed to have
incurred such Debt at the time of such extension, renewal or refunding.
10.4 Liens
The Company will not, and will not permit any of its Subsidiaries to,
directly or indirectly create, assume, incur or suffer to be created, assumed or
incurred or to exist, any Lien on or with respect to any property or asset
(including, without limitation, any document or instrument in respect of goods
or accounts receivable) of the Company or any such Subsidiary, whether now owned
or held or hereafter acquired, or any income or profits therefrom, or assign or
otherwise convey any right to receive income or profits (unless it makes, or
causes to be made, effective provision whereby the Notes will be equally and
ratably secured with any and all other obligations thereby secured, pursuant to
an agreement or agreements reasonably satisfactory to the Required Holders and,
in any such case, the Notes shall have the benefit, to the fullest extent that,
and with such priority as, the holders of the Notes may be entitled under
applicable law, of an equitable Lien on such property), except:
22
(a) Taxes, etc. -- Liens for taxes, assessments or other governmental
charges that are not yet due and payable or the payment of which is not
at the time required by Section 9.4;
(b) Legal Proceedings -- Liens
(i) arising from judicial attachments and judgments,
(ii) securing appeal bonds, supersedeas bonds, and
(iii) arising in connection with court proceedings (including, without
limitation, surety bonds and letters of credit or any other instrument
serving a similar purpose),
provided that the execution or other enforcement of such Liens is
effectively stayed and the claims secured thereby are being actively
contested in good faith and by appropriate proceedings, and in respect of
which adequate reserves shall have been established on the books of the
Company and its Subsidiaries in accordance with GAAP;
(c) Ordinary Course Liens -- Liens incidental to the normal conduct of the
business of the Company or any Subsidiary or the ownership of their properties
or assets which are not incurred in connection with the incurrence of Debt and
which do not in the aggregate materially impair the use of such properties in
the operation of the business of the Company and its Subsidiaries taken as a
whole or materially impair the value of such properties for the purpose of such
business, including, without limitation, Liens
(i) in connection with workers' compensation, unemployment insurance,
social security and other like laws,
(ii) to secure (or to obtain letters of credit that secure) the
performance of tenders, statutory obligations, surety and performance bonds
(of a type other than set forth in Section 10.4(b)), bids, leases (other
than Capital Leases), purchase, construction or sales contracts and other
similar obligations, in each case not incurred or made in connection with
the borrowing of money, the obtaining of advances or credit or the payment
of the deferred purchase price of property,
(iii) to secure the claims or demands of materialmen, mechanics,
carriers, warehousemen, vendors, repairmen, landlords, lessors and other
like Persons, arising in the ordinary course of business, and
(iv) in the nature of reservations, exceptions, encroachments,
easements, rights-of-way, covenants, conditions, restrictions, leases and
other similar title exceptions or encumbrances affecting real property,
23
provided that any amounts secured by such Liens are not overdue;
(d) (i) Existing Liens -- Liens in existence as of the date of the Closing
securing Debt and listed in Schedule 5.15, and
(ii) Renewals -- Liens securing renewals, extensions (as to time) and
refinancings of Debt secured by the Liens listed in Schedule 5.15, provided
that (A) the amount of Debt secured by each such Lien is not increased in
excess of the amount of Debt outstanding on the date of such renewal,
extension or refinancing, (B) none of such Liens is extended to include any
additional property of the Company or any Subsidiary, and (C) immediately
after giving effect thereto, no Default or Event of Default would exist;
(e) Intra-Group Liens -- Liens on property of the Company or any of its
Subsidiaries securing Debt owing to the Company or to any of its Subsidiaries;
provided that any such Lien does not materially and adversely affect the
interests of the holders of the Notes under the Financing Documents;
(f) Purchase Money Liens -- Liens on fixed assets (or any improvement
thereon) or in rights relating thereto, in each case, acquired or constructed by
the Company or any Subsidiary after the date of the Closing to secure Debt of
the Company or such Subsidiary incurred in connection with such acquisition or
construction, provided that
(i) no such Lien shall extend to or cover any property other than the
property (or improvement thereon) being acquired or constructed,
(ii) the amount of Debt secured by any such Lien shall not exceed an
amount equal to the lesser of (A) the cost to the Company or such
Subsidiary of the property (or improvement thereon) being acquired or
constructed or (B) the Fair Market Value (as determined in good faith by
the Company) of such property, determined at the time of such acquisition
or at the time of substantial completion of such construction, and
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(iii) such Lien shall be created concurrently with or within 120 days
after such acquisition or the substantial completion of such construction;
(g) Acquisition Liens -- Liens existing on property of a Person immediately
prior to its being consolidated with or merged into the Company or a Subsidiary
or its becoming a Subsidiary, or any Lien existing on any property acquired by
the Company or any Subsidiary at the time such property is so acquired (whether
or not the Debt secured thereby shall have been assumed), provided that
(i) no such Lien shall have been created or assumed in contemplation
of such consolidation or merger or such Person's becoming a Subsidiary or
such acquisition of property,
(ii) each such Lien shall extend solely to the item or items of
property so acquired and, if required by the terms of the instrument
originally creating such Lien, other property which is an improvement to or
is acquired for specific use in connection with such acquired property, and
(iii) the principal amount of the Debt secured by any such Lien shall
at no time exceed an amount equal to the Fair Market Value (as determined
in good faith by the board of directors of the Company or such Subsidiary)
of such property (or improvement thereon) at the time of such transaction;
(h) Consignment Liens -- Liens incurred in the ordinary course of business
not securing Debt in favor of Persons supplying the Company or any Subsidiary
with precious metals, precious gems or jewelry on a consignment basis, provided
that such Liens cover only the following property of the Company or such
Subsidiary which shall have been supplied by such Persons:
(i) gold and silver bullion, gold and silver granule and other gold,
silver, platinum or precious metals and precious gems or jewelry in
whatever form including all substitutions, replacements and products in
which any gold, silver, platinum or precious metals and precious gems or
jewelry are incorporated or into which gold, silver, platinum or precious
metals and precious gems or jewelry are processed or converted, whether now
or hereafter owned or acquired by the Company or such Subsidiary or in
which the Company or such Subsidiary now or hereafter acquires an interest,
and all proceeds and products of and accessions to the foregoing, and
(ii) all inventory now or hereafter owned by the Company or such
Subsidiary or in which the Company or such Subsidiary now or hereafter
acquires an interest, including all merchandise, returned and repossessed
goods, raw materials, goods in process, finished goods and proceeds
therefor, and all accounts of the Company or such Subsidiary including all
accounts receivable, notes, drafts, acceptances and other forms of
obligations and receivables now owned or hereafter arising from such
inventory sold or otherwise disposed of by the Company or such Subsidiary
and proceeds thereof and all contract rights and proceeds of the foregoing;
and
(i) Other Liens -- Liens securing Debt of the Company or any Subsidiary and
not otherwise permitted by clauses (a) through (h) inclusive, of this Section
10.4 (other than Liens securing Debt under the Credit Agreement), but only to
the extent that the Debt secured by such Lien is, at the time of the incurrence
of such Debt, permitted to be incurred under Section 10.3(b).
10.5 Merger, Consolidation, etc
The Company will not, and will not permit any Subsidiary to, directly or
indirectly, consolidate with, or merge into, any other Person or permit any
other Person to consolidate with, or merge into, it, or convey, transfer or
lease substantially all of its assets in a single transaction or series of
transactions to any Person, except that
(a) any Subsidiary (other than a Guarantor) may consolidate with, or merge
into, the Company or another Subsidiary if, immediately after, and after giving
effect to, such transaction, no Default or Event of Default shall exist;
25
(b) any Subsidiary (other than a Guarantor) may consolidate with, or merge
into, any other Person, or allow any other Person to consolidate with, or merge
into, it, if
(i) in the case of any consolidation or merger in which the successor
or surviving corporation is a Subsidiary, immediately after, and after
giving effect to, such transaction,
(A) no Default or Event of Default would exist, and
(B) the successor or surviving corporation would be permitted to
incur at least $1.00 of additional Debt by the provisions of Section
10.3(a) and at least $1.00 of additional Priority Debt by the
provisions of Section 10.3(b) (in each case, other than Debt owing to
the Company or a Subsidiary), and
(ii) in the case of any consolidation or merger in which the successor
or surviving corporation is not a Subsidiary, such transaction would be
permitted under the provisions of Section 10.6(a)(iii) (deeming such
consolidation or merger to be a Transfer of all of the assets and
liabilities of such Subsidiary) and immediately after, and after giving
effect to, such transaction, no Default or Event of Default would exist;
and
(c) the Company or any Guarantor may consolidate with, or merge into, any
other Person, or permit any other Person to consolidate with, or merge into, it,
if
(i) the successor or surviving corporation (the "Successor
Corporation") shall be a solvent corporation organized under the laws of
any state of the United States of America,
(ii) the Successor Corporation, if not the Company or such Guarantor,
shall have executed and delivered to each holder of any Notes its
assumption of the due and punctual performance and observance of the
obligations of the Company under this Agreement and the Notes, or of such
Guarantor under the Guaranty Agreement, as the case may be, including,
without limitation, all covenants herein and therein contained, and the
Company shall cause to be delivered to each holder of a Note an opinion of
outside counsel (such counsel to be reasonably satisfactory to the Required
Holders) confirming the enforceability of such assumption, and
(iii) immediately after, and after giving effect to, such transaction,
(A) no Default or Event of Default would exist, and
(B) the Successor Corporation would be permitted to incur at
least $1.00 of additional Debt by the provisions of Section 10.3(a)
and at least $1.00 of additional Priority Debt by the provisions of
Section 10.3(b) (in each case, other than Debt owing to the Company or
a Subsidiary).
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10.6 Sale of Assets
(a) Sale of Assets. The Company will not, and will not permit any of its
Subsidiaries to, make any Transfer, provided that the foregoing restriction does
not apply to a Transfer if:
(i) the property that is the subject of such Transfer constitutes either
(A) inventory held for sale, or (B) equipment, fixtures, supplies or materials
no longer required, in the opinion of the Company or such Subsidiary, in the
operation of the business of the Company or such Subsidiary or that is obsolete,
and, in the case of any Transfer described in clause (A) or clause (B), such
Transfer is in the ordinary course of business (an "Ordinary Course Transfer");
or
(ii) either
(A) such Transfer is from a Subsidiary to the Company or a
Wholly-Owned Subsidiary;
(B) such Transfer is from the Company to a Wholly-Owned Subsidiary; or
(C) such Transfer is from a Wholly-Owned Subsidiary to the Company or
any other Wholly-Owned Subsidiary;
so long as immediately before and immediately after the consummation of
such transaction, and after giving effect thereto,
(I) no Default or Event of Default exists or would exist, and
(II) the Company would be permitted to incur at least $1.00 of
additional Debt by the provisions of Section 10.3(a) and at least
$1.00 of additional Priority Debt by the provisions of Section 10.3(b)
(in each case other than Debt owing to the Company or a Subsidiary)
(each such Transfer, collectively with any Ordinary Course Transfers,
"Excluded Transfers"); or
(iii) such Transfer is not an Excluded Transfer and does not involve a
Substantial Portion of the property of the Company and its Subsidiaries, so long
as immediately before and immediately after the consummation of such
transaction, and after giving effect thereto, no Default or Event of Default
exists or would exist.
(b) Debt Prepayment Applications and Reinvested Transfers.
(i) Notwithstanding the provisions of Section 10.6(a), the
determination of whether a Transfer involves a Substantial Portion of the
property of the Company and its Subsidiaries, as provided in Section
10.6(a)(iii) and Section 10.6(c)(iii), shall be made without taking into
account the same proportion of the book value attributable to the property
subject to such Transfer as shall be equal to the proportion (the
"Designated Portion") of the Net Asset Sale Proceeds Amount with respect to
such Transfer to be applied to either a Debt Prepayment Application with
respect to such Transfer or the acquisition of assets of at least
equivalent value that are similar to the assets which were the subject of
such Transfer (a "Reinvested Transfer") within 365 days of the consummation
of such Transfer, as specified in an Officer's Certificate delivered to
each holder of Notes prior to, or contemporaneously with, the consummation
of such Transfer.
27
(ii) If, notwithstanding the certificate referred to in the foregoing
clause (i), the Company shall fail to apply the entire amount of the
Designated Portion as specified in such certificate within the period
stated in Section 10.6(b)(i), the computation of whether such Transfer
involved a Substantial Portion of the property of the Company and its
Subsidiaries shall be recomputed, as of the date of such Transfer, by
taking into account the same proportion of the book value attributable to
the property subject to such Transfer as shall be equal to the proportion
of the Net Asset Sale Proceeds Amount actually applied to either a Debt
Prepayment Application or a Reinvested Transfer within such period. If,
upon the recomputation provided for in the preceding sentence, such
Transfer involved a Substantial Portion of the property of the Company and
the Restricted Subsidiaries, an Event of Default shall be deemed to have
existed as of the expiration of such period.
(c) Certain Definitions. The following terms have the following meanings:
(i) "Debt Prepayment Application" means, with respect to any Transfer
of property by the Company or any Subsidiary, the application by the
Company or such Subsidiary of cash in an amount equal to the Net Asset Sale
Proceeds Amount with respect to such Transfer to pay Senior Debt of the
Company or such Subsidiary (other than Senior Debt owing to any of the
Subsidiaries or any Affiliate and Senior Debt in respect of any revolving
credit or similar facility providing the Company or such Subsidiary with
the right to obtain loans or other extensions of credit from time to time,
except to the extent that in connection with such payment of Senior Debt
the availability of credit under such credit facility is permanently
reduced by an amount not less than the amount of such proceeds applied to
the payment of such Senior Debt), provided that in the course of making
such application the Company shall offer to prepay each outstanding Note in
accordance with Section 8.3 in a principal amount that equals the Ratable
Portion for such Note. A holder of Notes may accept or reject such offer to
prepay by causing a notice of such acceptance or rejection to be delivered
to the Company at least two Business Days prior to the prepayment date
specified by the Company in such offer. If a holder of Notes has not
responded to such offer by a date which is at least two Business Days prior
to such specified prepayment date, such holder shall be deemed to have
accepted such offer of prepayment. If any holder of a Note rejects such
offer of prepayment, then, for purposes of the preceding sentence only, the
Company nevertheless will be deemed to have paid Senior Debt in an amount
equal to the Ratable Portion for such Note.
As used in this definition,
"Ratable Portion" means, for any Note, an amount equal to the product
of
28
(A) the Net Asset Sale Proceeds Amount being so offered to be
applied to the payment of Senior Debt, multiplied by
(B) a fraction the numerator of which is the outstanding
principal amount of such Note and the denominator of which is the
aggregate outstanding principal amount of Senior Debt of the Company
and its Subsidiaries, after eliminating all offsetting debits and
credits between the Company and its Subsidiaries and all other items
required to be eliminated in the course of the preparation of
consolidated financial statements of the Company and its Subsidiaries
in accordance with GAAP.
(ii) "Disposition Value" means, at any time, with respect to any
Transfer of property,
(A) in the case of property that does not constitute Capital
Stock of a Subsidiary, the book value thereof, valued at the amount
taken into account (or which would be taken into account) in the
consolidated balance sheet of the Company then most recently required
to have been delivered to the holders pursuant to Section 7.1, and
(B) in the case of property that constitutes Capital Stock of a
Subsidiary, an amount equal to that percentage of the book value of
the assets of the Subsidiary that issued such Capital Stock as is
equal to the percentage that the book value of such Capital Stock
represents of the book value of all of the outstanding Capital Stock
of such Subsidiary (assuming, in making such calculations, that all
securities convertible into such Capital Stock are so converted and
giving full effect to all transactions that would occur or be required
in connection with such conversion), determined as of the date of the
balance sheet referred to in the foregoing clause (A).
(iii) "Substantial Portion" means, at any time, any property subject
to a Transfer if
(A) the Disposition Value of such property, when added to the
Disposition Value of all other property of the Company and its
Subsidiaries that shall have been the subject of a Transfer (other
than an Excluded Transfer and subject, with respect to both such
property and all such other property, to the provisions of Section
10.6(b)) during the then current fiscal year of the Company, exceeds
an amount equal to 15% of Consolidated Total Assets as reflected (or
as would be reflected) in the consolidated balance sheet of the
Company then most recently required to have been delivered to the
holders pursuant to Section 7.1, or
(B) the Disposition Value of such property, when added to the
Disposition Value of all other property of the Company and its
Subsidiaries that shall have been the subject of a Transfer (other
than an Excluded Transfer and subject, with respect to both such
property and all such other property, to the provisions of Section
10.6(b)) during the period beginning on the date of the date of the
Closing and ending on and including the date of the consummation of
such Transfer, exceeds an amount equal to 30% of Consolidated Total
Assets as reflected (or as would be reflected) in the consolidated
balance sheet of the Company then most recently required to have been
delivered to the holders pursuant to Section 7.1.
29
(iv) "Transfer" means, with respect to any Person, any
transaction in which such Person sells, conveys, transfers or leases
(as lessor) any of its property, including, without limitation,
Capital Stock of any other Person, but does not include any such
transaction subject to the provisions of Section 10.5 (other than
Section 10.5(b)(ii)).
10.7 Most Favored Lender Status
(a) If the Company agrees to any addition, amendment, waiver, deletion,
termination or other modification of any affirmative or negative covenant,
default, event of default or comparable provision (however named or designated)
set forth in the Credit Agreement (a "Credit Agreement Modification") which is
more or less restrictive on the Company or any Subsidiary than the provisions
contained in this Agreement, then the Company shall, within five (5) Business
Days, provide a notice to the holders of the Notes in respect of each such
Credit Agreement Modification. Immediately upon the effectiveness of a Credit
Agreement Modification, the terms of such Credit Agreement Modification shall be
automatically incorporated by reference into this Agreement (such Credit
Agreement Modification as so incorporated is herein referred to as an
"Incorporated Provision")), mutatis mutandis, as if set forth fully herein;
provided, that at any time as a Default or Event of Default has occurred and is
continuing, no Credit Agreement Modification which is less restrictive on the
Company or any Subsidiary will be deemed incorporated into this Agreement
without the prior written consent of the Required Holders, which written consent
shall not be unreasonably withheld or delayed. Notwithstanding the foregoing, in
no event shall an Incorporated Provision amend or modify any provision otherwise
set forth herein to make such provision less restrictive as to the Company or
any Subsidiary than the corresponding provision set forth in the 2002 Note
Agreement, as in effect on the date of the Closing.
(b) Except as contemplated by Section 10.7(a), no Incorporated Provision
shall be modified unless such Incorporated Provision is amended or waived in
accordance with the provisions of Section 17 and then only to the extent of such
amendment or waiver.
(c) In connection with any Credit Agreement Modification, the Company and
the Required Holders agree within 30 days of the written request of either the
Company or the Required Holders, to enter into a formal amendment to this
Agreement, in form and substance satisfactory to the Required Holders, acting
reasonably, to document the applicable amendments to this Agreement arising from
any such Credit Agreement Modification. If any fee, supplemental or additional
interest or other consideration is given to any lender under a Credit Agreement
Modification as consideration for or as an inducement to enter into any Credit
Agreement Modification, the equivalent of such fee, supplemental or additional
interest or other consideration shall be paid to the holders of the Notes with
respect to such Credit Agreement Modification that is incorporated into this
Agreement at the same time as such fee, supplemental or additional interest or
other consideration is paid to such lender. For the avoidance of doubt, the
amount of any payment (whether as fee or interest) to any holder of Notes then
being made shall be deemed equivalent to any similar payment under the Credit
Agreement if such payment to such holder of Notes represents the same percentage
of the then outstanding principal amount of such Notes as the percentage of all
then outstanding Debt under the Credit Agreement represented by the aggregate
amount of such similar payments under the Credit Agreement.
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11. EVENTS OF DEFAULT
An "Event of Default" shall exist if any of the following conditions or
events shall occur and be continuing:
(a) the Company defaults in the payment of any principal or Make-Whole
Amount, if any, on any Note when the same becomes due and payable, whether at
maturity or at a date fixed for prepayment or by declaration or otherwise; or
(b) the Company defaults in the payment of any interest on any Note for
more than five Business Days after the same becomes due and payable; or
(c) the Company defaults in the performance of or compliance with any term
contained in any of Sections 10.3 through Section 10.6, inclusive, any
Incorporated Provision that amends, or is otherwise of the type set forth in
such Sections 10.3 through 10.6 or is a negative covenant or Section 7.1(d); or
(d) the Company defaults in the performance of or compliance with any term
contained herein (other than those referred to in paragraphs (a), (b) and (c) of
this Section 11) and such default is not remedied within 30 days after the
earlier of (i) a Responsible Officer obtaining actual knowledge of such default
and (ii) the Company receiving written notice of such default from any holder of
a Note (any such written notice to be identified as a "notice of default" and to
refer specifically to this paragraph (d) of Section 11); or
(e) any representation or warranty made in writing by or on behalf of the
Company or any Guarantor or by any officer of the Company or any Guarantor in
this Agreement or the Guaranty Agreement or in any writing furnished in
connection with the transactions contemplated hereby proves to have been false
or incorrect in any material respect on the date as of which made; or
(f) (i) the Company or any Subsidiary is in default (as principal or as
guarantor or other surety) in the payment of any principal of or premium or
make-whole amount or interest on any Indebtedness (other than Indebtedness under
this Agreement and the Notes) beyond any period of grace provided with respect
thereto, that individually or together with such other Indebtedness as to which
any such default exists has an aggregate outstanding principal amount of at
least $20,000,000, or
(ii) the Company or any Subsidiary is in default in the performance of
or compliance with any term of any evidence of any Indebtedness (other than
Indebtedness under this Agreement and the Notes), that individually or
together with such other Indebtedness as to which any such default exists
has an aggregate outstanding principal amount of at least $25,000,000, or
of any mortgage, indenture or other agreement relating thereto or any other
condition exists, and as a consequence of such default or condition such
Indebtedness has become, or has been declared (or one or more Persons are
entitled to declare such Indebtedness to be), due and payable before its
stated maturity or before its regularly scheduled dates of payment, or
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(iii) as a consequence of the occurrence or continuation of any event
or condition (other than the passage of time or the right of the holder of
Indebtedness to convert such Indebtedness into equity interests), (x) the
Company or any Subsidiary has become obligated to purchase or repay
Indebtedness before its regular maturity or before its regularly scheduled
dates of payment in an aggregate outstanding principal amount of at least
$20,000,000, or (y) one or more Persons have the right to require the
Company or any Subsidiary so to purchase or repay such Indebtedness; or
(g) the Company or any Guarantor (i) is generally not paying, or admits in
writing its inability to pay, its debts as they become due, (ii) files, or
consents by answer or otherwise to the filing against it of, a petition for
relief or reorganization or arrangement or any other petition in bankruptcy, for
liquidation or to take advantage of any bankruptcy, insolvency, reorganization,
moratorium or other similar law of any jurisdiction, (iii) makes an assignment
for the benefit of its creditors, (iv) consents to the appointment of a
custodian, receiver, trustee or other officer with similar powers with respect
to it or with respect to any substantial part of its property, (v) is
adjudicated as insolvent or to be liquidated, or (vi) takes corporate action for
the purpose of any of the foregoing; or
(h) a court or governmental authority of competent jurisdiction enters an
order appointing, without consent by the Company or any Guarantor, a custodian,
receiver, trustee or other officer with similar powers with respect to the
Company or any Guarantor or with respect to any substantial part of the property
of the Company or any Guarantor, or constituting an order for relief or
approving a petition for relief or reorganization or any other petition in
bankruptcy or for liquidation or to take advantage of any bankruptcy or
insolvency law of any jurisdiction, or ordering the dissolution, winding-up or
liquidation of the Company or any Guarantor, or any such petition shall be filed
against the Company or any Guarantor and such petition shall not be dismissed
within 60 days; or
(i) a final judgment or judgments for the payment of money aggregating in
excess of $25,000,000 (excluding any judgment or judgments to the extent the
Company or any applicable Subsidiary is fully insured and with respect to which
the insurer has assumed responsibility in writing) are rendered against one or
more of the Company and its Subsidiaries and which judgments are not, within 45
days after entry thereof, bonded, discharged or stayed pending appeal, or are
not discharged within 45 days after the expiration of such stay; or
(j) (i) the Guaranty Agreement shall cease to be in full force and effect
or shall be declared by a court or governmental authority of competent
jurisdiction to be void, voidable or unenforceable against any Guarantor, or
(ii) the validity or enforceability of the Guaranty Agreement against
any Guarantor shall be contested by such Guarantor or the Company, or
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(iii) any Guarantor or the Company shall deny that such Guarantor has
any further liability or obligation under the Guaranty Agreement; or
(k) if
(i) any Plan shall fail to satisfy the minimum funding standards of
ERISA or the Code for any plan year or part thereof or a waiver of such
standards or extension of any amortization period is sought or granted
under section 412 of the Code,
(ii) a notice of intent to terminate any Plan shall have been or is
reasonably expected to be filed with the PBGC or the PBGC shall have
instituted proceedings under ERISA section 4042 to terminate or appoint a
trustee to administer any Plan or the PBGC shall have notified the Company
or any ERISA Affiliate that a Plan may become a subject of any such
proceedings,
(iii) the aggregate "amount of unfunded benefit liabilities" (within
the meaning of section 4001(a)(18) of ERISA) under all Plans, determined in
accordance with Title IV of ERISA, shall exceed $25,000,000,
(iv) the Company or any ERISA Affiliate shall have incurred or is
reasonably expected to incur any liability pursuant to Title I or IV of
ERISA or the penalty or excise tax provisions of the Code relating to
employee benefit plans,
(v) the Company or any ERISA Affiliate withdraws from any
Multiemployer Plan, or
(vi) the Company or any Subsidiary establishes or amends any employee
welfare benefit plan that provides post-employment welfare benefits in a
manner that would increase the liability of the Company or any Subsidiary
thereunder;
and any such event or events described in clauses (i) through (vi) above,
either individually or together with any other such event or events, could
reasonably be expected to have a Material Adverse Effect.
As used in Section 11(k), the terms "employee benefit plan" and "employee
welfare benefit plan" shall have the respective meanings assigned to such
terms in section 3 of ERISA.
12. REMEDIES ON DEFAULT, ETC
12.1 Acceleration
(a) If an Event of Default with respect to the Company described in
paragraph (g) or paragraph (h) of Section 11 (other than an Event of Default
described in clause (i) of paragraph (g) or described in clause (vi) of
paragraph (g) by virtue of the fact that such clause encompasses clause (i) of
paragraph (g)) has occurred, all the Notes then outstanding shall automatically
become immediately due and payable.
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(b) If any other Event of Default has occurred and is continuing, any
holder or holders of more than 50% in principal amount of the Notes at the time
outstanding may at any time at its or their option, by notice or notices to the
Company, declare all the Notes then outstanding to be immediately due and
payable.
(c) If any Event of Default described in paragraph (a) or (b) of Section 11
has occurred and is continuing, any holder or holders of Notes at the time
outstanding affected by such Event of Default may at any time, at its or their
option, by notice or notices to the Company, declare all the Notes held by it or
them to be immediately due and payable.
Upon any Notes becoming due and payable under this Section 12.1, whether
automatically or by declaration, such Notes will forthwith mature and the entire
unpaid principal amount of such Notes, plus (x) all accrued and unpaid interest
thereon and (y) the Make-Whole Amount determined in respect of such principal
amount (to the full extent permitted by applicable law), shall all be
immediately due and payable, in each and every case without presentment, demand,
protest or further notice, all of which are hereby waived. The Company
acknowledges, and the parties hereto agree, that each holder of a Note has the
right to maintain its investment in the Notes free from repayment by the Company
(except as herein specifically provided for) and that the provision for payment
of a Make-Whole Amount by the Company in the event that the Notes are prepaid or
are accelerated as a result of an Event of Default, is intended to provide
compensation for the deprivation of such right under such circumstances.
12.2 Other Remedies
If any Default or Event of Default has occurred and is continuing, and
irrespective of whether any Notes have become or have been declared immediately
due and payable under Section 12.1, the holder of any Note at the time
outstanding may proceed to protect and enforce the rights of such holder by an
action at law, suit in equity or other appropriate proceeding, whether for the
specific performance of any agreement contained in any Financing Document, or
for an injunction against a violation of any of the terms thereof, or in aid of
the exercise of any power granted thereby or by law or otherwise.
12.3 Rescission
At any time after any Notes have been declared due and payable pursuant to
clause (b) or clause (c) of Section 12.1, the holders of not less than 66-2/3%
in principal amount of the Notes then outstanding, by written notice to the
Company, may rescind and annul any such declaration and its consequences if (a)
the Company has paid all overdue interest on the Notes, all principal of and
Make-Whole Amount, if any, on any Notes that are due and payable and are unpaid
other than by reason of such declaration, and all interest on such overdue
principal and Make-Whole Amount, if any, and (to the extent permitted by
applicable law) any overdue interest in respect of the Notes, at the Default
Rate, (b) all Events of Default and Defaults, other than non-payment of amounts
that have become due solely by reason of such declaration, have been cured or
have been waived pursuant to Section 17, and (c) no judgment or decree has been
entered for the payment of any monies due pursuant hereto or to the Notes. No
rescission and annulment under this Section 12.3 will extend to or affect any
subsequent Event of Default or Default or impair any right consequent thereon.
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12.4 No Waivers or Election of Remedies, Expenses, etc
No course of dealing and no delay on the part of any holder of any Note in
exercising any right, power or remedy shall operate as a waiver thereof or
otherwise prejudice such holder's rights, powers or remedies. No right, power or
remedy conferred by any Financing Document upon any holder of any Note shall be
exclusive of any other right, power or remedy referred to herein or therein or
now or hereafter available at law, in equity, by statute or otherwise. Without
limiting the obligations of the Company under Section 15, the Company will pay
to the holder of each Note on demand such further amount as shall be sufficient
to cover all costs and expenses of such holder incurred in any enforcement or
collection under this Section 12, including, without limitation, reasonable
attorneys' fees, expenses and disbursements.
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES
13.1 Registration of Notes
The Company shall keep at its principal executive office a register for the
registration and registration of transfers of Notes. The name and address of
each holder of one or more Notes, each transfer thereof and the name and address
of each transferee of one or more Notes shall be registered in such register.
Prior to due presentment for registration of transfer, the Person in whose name
any Note shall be registered shall be deemed and treated as the owner and holder
thereof for all purposes hereof, and the Company shall not be affected by any
notice or knowledge to the contrary. The Company and each Purchaser acknowledge
and agree that the Notes are not "negotiable instruments" within the meaning of
ss.3-104 of the Uniform Commercial Code as adopted in the State of New York. The
Company shall give to any holder of a Note that is an Institutional Investor
promptly upon request therefor, a complete and correct copy of the names and
addresses of all registered holders of Notes.
13.2 Transfer and Exchange of Notes
Upon surrender of any Note to the Company at the address and to the
attention of the designated officer (all as specified in Section 18(iii), for
registration of transfer or exchange (and in the case of a surrender for
registration of transfer, duly endorsed or accompanied by a written instrument
of transfer duly executed by the registered holder of such Note or his attorney
duly authorized in writing and accompanied by the address for notices of each
transferee of such Note or part thereof), the Company shall execute and deliver,
at the Company's expense (except as provided below), one or more new Notes of
the same Series as such surrendered Note (as requested by the holder thereof) in
exchange therefor, in an aggregate principal amount equal to the unpaid
principal amount of the surrendered Note. Each such new Note shall be payable to
such Person as such holder may request and shall be substantially in the form of
Exhibit 1A or Exhibit 1B, as the case may be. Each such new Note shall be dated
and bear interest from the date to which interest shall have been paid on the
surrendered Note or dated the date of the surrendered Note if no interest shall
have been paid thereon. The Company may require payment of a sum sufficient to
cover any stamp tax or governmental charge imposed in respect of any such
transfer of Notes. Notes shall not be transferred in denominations of less than
$100,000, provided that if necessary to enable the registration of transfer by a
holder of its entire holding of Notes of a Series, one Note of such Series may
be in a denomination of less than $100,000. Any transferee, by its acceptance of
a Note registered in its name (or the name of its nominee), shall be deemed to
have made the representation set forth in Section 6.2.
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13.3 Replacement of Notes
Upon receipt by the Company of evidence reasonably satisfactory to it of
the ownership of and the loss, theft, destruction or mutilation of any Note
(which evidence shall be, in the case of an Institutional Investor, notice from
such Institutional Investor of such ownership and such loss, theft, destruction
or mutilation), and
(a) in the case of loss, theft or destruction, of indemnity reasonably
satisfactory to it (provided that if the holder of such Note is, or is a nominee
for, an original Purchaser or a Qualified Institutional Buyer, such Person's own
unsecured agreement of indemnity shall be deemed to be satisfactory), or
(b) in the case of mutilation, upon surrender and cancellation thereof,
the Company at its own expense shall execute and deliver, in lieu thereof, a new
Note of the same Series, dated and bearing interest from the date to which
interest shall have been paid on such lost, stolen, destroyed or mutilated Note
or dated the date of such lost, stolen, destroyed or mutilated Note if no
interest shall have been paid thereon.
14. PAYMENTS ON NOTES
14.1 Place of Payment
Subject to Section 14.2, payments of principal, Make-Whole Amount, if any,
and interest becoming due and payable on the Notes shall be made in New York,
New York at the principal office of the Company in such jurisdiction. The
Company may at any time, by notice to each holder of a Note, change the place of
payment of the Notes so long as such place of payment shall be either the
principal office of the Company in such jurisdiction or the principal office of
a bank or trust company in such jurisdiction.
14.2 Home Office Payment
So long as any Purchaser or its nominee shall be the holder of any Note,
and notwithstanding anything contained in Section 14.1 or in such Note to the
contrary, the Company will pay all sums becoming due on such Note for principal,
Make-Whole Amount, if any, and interest by (i) the method and at the address
specified for such purpose below such Purchaser's name in Schedule A or (ii) by
such other method or at such other address as such Purchaser shall have from
time to time specified to the Company in writing for such purpose, without the
presentation or surrender of such Note or the making of any notation thereon,
except that upon payment or prepayment in full of any Note, such Purchaser shall
promptly surrender such Note for cancellation to the Company at its principal
executive office or at the place of payment most recently designated by the
Company pursuant to Section 14.1. Prior to any sale or other disposition of any
Note held by any Purchaser or its nominee, such Purchaser will, at its election,
either endorse thereon the amount of principal paid thereon and the last date to
which interest has been paid thereon or surrender such Note to the Company in
exchange for a new Note or Notes pursuant to Section 13.2. The Company will
afford the benefits of this Section 14.2 to any Qualified Institutional Buyer or
Institutional Investor that is the direct or indirect transferee of any Note
purchased by any Purchaser under this Agreement and that has made the same
agreement relating to such Note as such Purchaser has made in this Section 14.2.
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15. EXPENSES, ETC
15.1 Transaction Expenses
Whether or not the transactions contemplated hereby are consummated, the
Company will pay all costs and expenses (including reasonable attorneys' fees of
one special counsel for all Purchasers and holders of Notes and, if reasonably
required, one local counsel in each jurisdiction where such counsel is so
required) incurred by each Purchaser or holder of a Note in connection with such
transactions and in connection with any amendments, waivers or consents under or
in respect of the Financing Documents (whether or not such amendment, waiver or
consent becomes effective), including, without limitation: (a) the costs and
expenses incurred in enforcing or defending (or determining whether or how to
enforce or defend) any rights under the Financing Documents or in responding to
any subpoena or other legal process or informal investigative demand issued in
connection with the Financing Documents, or by reason of being a holder of any
Note, and (b) the costs and expenses, including financial advisors' fees,
incurred in connection with the insolvency or bankruptcy of the Company or any
Subsidiary or in connection with any work-out or restructuring of the
transactions contemplated by the Financing Documents. The Company will pay, and
will save each Purchaser and each other holder of a Note harmless from, all
claims in respect of any fees, costs or expenses if any, of brokers and finders
(other than those retained by such Purchaser).
15.2 Survival
The obligations of the Company under this Section 15 will survive the
payment or transfer of any Note, the enforcement, amendment or waiver of any
provision of any Financing Document, and the termination of any Financing
Document.
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT
All representations and warranties contained in any Financing Document
shall survive the execution and delivery of this Agreement and the Notes and the
purchase or transfer by any Purchaser of any Note or portion thereof or interest
therein, and may be relied upon by any subsequent holder of a Note, regardless
of any investigation made at any time by or on behalf of any Purchaser or any
other holder of a Note. All statements contained in any certificate or other
instrument or writing delivered by or on behalf of the Company pursuant to any
Financing Document shall be deemed representations and warranties of the Company
under this Agreement. Subject to the preceding sentence, the Financing Documents
embody the entire agreement and understanding between each Purchaser and the
Obligors and supersede all prior agreements and understandings relating to the
subject matter hereof.
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17. AMENDMENT AND WAIVER
17.1 Requirements
This Agreement and the Notes may be amended, and the observance of any term
hereof or of the Notes may be waived (either retroactively or prospectively),
with (and only with) the written consent of the Company and the Required
Holders, except that (a) no amendment or waiver of any of the provisions of any
of Sections l, 2, 3, 4, 5, 6 and 21, or any defined term (as it is used
therein), will be effective as to a Purchaser unless consented to by such
Purchaser in writing, and (b) no such amendment or waiver may, without the
written consent of the holder of each Note at the time outstanding affected
thereby, (i) subject to the provisions of Section 12 relating to acceleration or
rescission, change the amount or time of any prepayment or payment of principal
of, or reduce the rate or change the time of payment or method of computation of
interest or of the Make-Whole Amount on, the Notes, (ii) change the percentage
of the principal amount of the Notes the holders of which are required to
consent to any such amendment or waiver, or (iii) amend any of Sections 8,
11(a), 11(b), 12, 14.2, 17 and 20.
17.2 Solicitation of Holders of Notes
(a) Solicitation. The Company will provide each holder of the Notes
(irrespective of the amount of Notes then owned by it) with sufficient
information, sufficiently far in advance of the date a decision is required, to
enable such holder to make an informed and considered decision with respect to
any proposed amendment, waiver or consent in respect of any of the provisions
hereof or of the Notes. The Company will deliver executed or true and correct
copies of each amendment, waiver or consent effected pursuant to the provisions
of this Section 17 to each holder of outstanding Notes promptly following the
date on which it is executed and delivered by, or receives the consent or
approval of, the requisite holders of Notes.
(b) Payment. The Company will not directly or indirectly pay or cause to be
paid any remuneration, whether by way of supplemental or additional interest,
fee or otherwise, or grant any security, to any holder of Notes as consideration
for or as an inducement to the entering into by any holder of Notes of any
waiver or amendment of any of the terms and provisions hereof unless such
remuneration is concurrently paid, or security is concurrently granted, on the
same terms, ratably to each holder of Notes then outstanding even if such holder
did not consent to such waiver or amendment.
(c) Consent in Contemplation of Transfer. Any consent made pursuant to this
Section 17 by a holder of Notes that has transferred or has agreed to transfer
its Notes to the Company, any Subsidiary or any Affiliate of the Company and has
provided or has agreed to provide such written consent as a condition to such
transfer shall be void and of no force or effect except solely as to such
holder, and any amendments effected or waivers granted or to be effected or
granted that would not have been or would not be so effected or granted but for
such consent (and the consents of all other holders of Notes that were acquired
under the same or similar conditions) shall be void and of no force or effect
except solely as to such holder.
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17.3 Binding Effect, etc
Any amendment or waiver consented to as provided in this Section 17 applies
equally to all holders of Notes and is binding upon them and upon each future
holder of any Note and upon the Company without regard to whether such Note has
been marked to indicate such amendment or waiver. No such amendment or waiver
will extend to or affect any obligation, covenant, agreement, Default or Event
of Default not expressly amended or waived or impair any right consequent
thereon. No course of dealing between the Company and the holder of any Note nor
any delay in exercising any rights hereunder or under any Note shall operate as
a waiver of any rights of any holder of such Note. As used herein, the term
"this Agreement" and references thereto shall mean this Agreement as it may from
time to time be amended or supplemented.
17.4 Notes held by Company, etc
Solely for the purpose of determining whether the holders of the requisite
percentage of the aggregate principal amount of Notes then outstanding approved
or consented to any amendment, waiver or consent to be given under any of the
Financing Documents, or have directed the taking of any action provided in any
of the Financing Documents to be taken upon the direction of the holders of a
specified percentage of the aggregate principal amount of Notes then
outstanding, Notes directly or indirectly owned by the Company or any of its
Affiliates shall be deemed not to be outstanding.
18. NOTICES
All notices and communications provided for hereunder shall be in writing
and sent (a) by telecopy if the sender on the same day sends a confirming copy
of such notice by a recognized overnight delivery service (charges prepaid), or
(b) by registered or certified mail with return receipt requested (postage
prepaid), or (c) by a recognized overnight delivery service (with charges
prepaid). Any such notice must be sent:
(i) if to a Purchaser or its nominee, to such Purchaser or its nominee
at the address specified for such communications in Schedule A, or at such
other address as such Purchaser or its nominee shall have specified to the
Company in writing,
(ii) if to any other holder of any Note, to such holder at such
address as such other holder shall have specified to the Company in
writing, or
(iii) if to the Company, to the Company at its address set forth at
the beginning hereof to the attention of the Chief Financial Officer,
telecopier: (▇▇▇) ▇▇▇-▇▇▇▇, or at such other address as the Company shall
have specified to the holder of each Note in writing, with a copy to the
Company's general counsel at the address provided pursuant to this
subsection (iii).
Notices under this Section 18 will be deemed given only when actually received.
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19. REPRODUCTION OF DOCUMENTS
This Agreement and all documents relating hereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by any Purchaser at the Closing (except
the Notes themselves), and (c) financial statements, certificates and other
information previously or hereafter furnished to any Purchaser, may be
reproduced by such Purchaser by any photographic, photostatic, microfilm,
microcard, miniature photographic or other similar process and such
Purchaser may destroy any original document so reproduced. The Company
agrees and stipulates that, to the extent permitted by applicable law, any
such reproduction shall be admissible in evidence as the original itself in
any judicial or administrative proceeding (whether or not the original is
in existence and whether or not such reproduction was made by such
Purchaser in the regular course of business) and any enlargement, facsimile
or further reproduction of such reproduction shall likewise be admissible
in evidence. This Section 19 shall not prohibit the Company or any other
holder of Notes from contesting any such reproduction to the same extent
that it could contest the original, or from introducing evidence to
demonstrate the inaccuracy of any such reproduction.
20. CONFIDENTIAL INFORMATION
For the purposes of this Section 20, "Confidential Information" means
information delivered to any Purchaser by or on behalf of the Company or
any Subsidiary in connection with the transactions contemplated by or
otherwise pursuant to this Agreement that is proprietary in nature and that
was clearly marked or labeled or otherwise adequately identified when
received by such Purchaser as being confidential information of the Company
or such Subsidiary, provided that such term does not include information
that
(a) was publicly known or otherwise known to such Purchaser prior to
the time of such disclosure,
(b) subsequently becomes publicly known through no act or omission by
such Purchaser or any person acting on such Purchaser's behalf,
(c) otherwise becomes known to such Purchaser other than through
disclosure by the Company or any Subsidiary, or
(d) constitutes financial statements delivered to such Purchaser under
Section 7.1 that are otherwise publicly available.
Such Purchaser will maintain the confidentiality of such Confidential
Information in accordance with procedures adopted by such Purchaser in good
faith to protect confidential information of third parties delivered to such
Purchaser, provided that such Purchaser may deliver or disclose Confidential
Information to:
(i) its directors, officers, trustees, employees, agents,
attorneys and affiliates (to the extent such disclosure reasonably
relates to the administration of the investment represented by its
Notes),
40
(ii) its financial advisors and other professional advisors who
agree to hold confidential the Confidential Information substantially
in accordance with the terms of this Section 20,
(iii) any other holder of any Note,
(iv) any Institutional Investor to which such Purchaser sells or
offers to sell such Note or any part thereof or any participation
therein (if such Person has agreed in writing prior to its receipt of
such Confidential Information to be bound by the provisions of this
Section 20),
(v) any Person from which such Purchaser offers to purchase any
security of the Company (if such Person has agreed in writing prior to
its receipt of such Confidential Information to be bound by the
provisions of this Section 20),
(vi) any federal or state regulatory authority having
jurisdiction over such Purchaser,
(vii) the National Association of Insurance Commissioners or any
similar organization, or any nationally recognized rating agency that
requires access to information about such Purchaser's investment
portfolio or
(viii) any other Person to which such delivery or disclosure may
be necessary or appropriate
(A) to effect compliance with any law, rule, regulation or
order applicable to such Purchaser,
(B) in response to any subpoena or other legal process,
(C) in connection with any litigation to which such
Purchaser is a party, or
(D) if an Event of Default has occurred and is continuing,
to the extent such Purchaser may reasonably determine such
delivery and disclosure to be necessary or appropriate in the
enforcement or for the protection of the rights and remedies
under the Financing Documents.
Each holder of a Note, by its acceptance of a Note, will be deemed to have
agreed to be bound by and to be entitled to the benefits of this Section 20 as
though it were a party to this Agreement. On reasonable request by the Company
in connection with the delivery to any holder of a Note of information required
to be delivered to such holder under this Agreement or requested by such holder
(other than a holder that is a party to this Agreement or its nominee), such
holder will enter into an agreement with the Company embodying the provisions of
this Section 20.
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21. SUBSTITUTION OF PURCHASER
Each Purchaser shall have the right to substitute any one of its Affiliates
as the purchaser of the Notes that such Purchaser has agreed to purchase
hereunder, by written notice to the Company, which notice shall be signed by
both such Purchaser and such Affiliate, shall contain such Affiliate's agreement
to be bound by this Agreement and shall contain a confirmation by such Affiliate
of the accuracy with respect to it of the representations set forth in Section
6.
22. MISCELLANEOUS
22.1 Successors and Assigns
All covenants and other agreements contained in this Agreement by or on
behalf of any of the parties hereto bind and inure to the benefit of their
respective successors and assigns (including, without limitation, any subsequent
holder of a Note) whether so expressed or not.
22.2 Payments Due on Non-Business Days
Anything in this Agreement or the Notes to the contrary notwithstanding,
any payment of principal of or Make-Whole Amount or interest on any Note that is
due on a date (including, without limitation, the final maturity date of the
Notes) other than a Business Day shall be made on the next succeeding Business
Day without including the additional days elapsed in the computation of the
interest payable on such next succeeding Business Day, except in the case of a
payment on the final maturity date which shall include such additional days in
such computation but shall not include the date on which such payment is
received.
22.3 Severability
Any provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall (to the full extent permitted by law) not invalidate or
render unenforceable such provision in any other jurisdiction.
22.4 Construction
Each covenant contained herein shall be construed (absent express provision
to the contrary) as being independent of each other covenant contained herein,
so that compliance with any one covenant shall not (absent such an express
contrary provision) be deemed to excuse compliance with any other covenant.
Where any provision herein refers to action to be taken by any Person, or which
such Person is prohibited from taking, such provision shall be applicable
whether such action is taken directly or indirectly by such Person.
42
22.5 Counterparts
This Agreement may be executed in any number of counterparts, each of which
shall be an original but all of which together shall constitute one instrument.
Each counterpart may consist of a number of copies hereof, each signed by less
than all, but together signed by all, of the parties hereto.
22.6 Governing Law
THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE
RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE OF NEW YORK
EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE
THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE.
[Remainder of page intentionally left blank. Next page is signature page.]
43
Very truly yours,
▇▇▇▇▇▇▇ & CO.
By: -----------------------------
Name:
Title:
The foregoing is hereby agreed to as of the date thereof:
GENERAL RE LIFE CORPORATION
By:
-----------------------------
Name:
Title:
BERKSHIRE HATHAWAY ASSURANCE
CORPORATION
By:
-----------------------------
Name:
Title:
BERKSHIRE HATHAWAY LIFE INSURANCE
COMPANY OF NEBRASKA
By:
-----------------------------
Name:
Title:
SCHEDULE B
DEFINED TERMS
-------------
As used herein, the following terms have the respective meanings set forth
below or set forth in the Section hereof following such term:
"2002 Note Agreement" means that certain Note Purchase Agreement dated as
of July 18, 2002, by and among ▇▇▇▇▇▇▇ & Co., a Delaware corporation, and the
purchasers that are parties thereto, as amended, restated or otherwise modified
from time to time.
"Affiliate" means at any time, and with respect to any Person,
(a) any other Person that at such time directly or indirectly through
one or more intermediaries Controls, or is Controlled by, or is under
common Control with, such first Person; or
(b) (i) any Person beneficially owning or holding, directly or
indirectly, 10% or more of any class of voting or equity interests of the
Company or any Subsidiary, or (ii) any Person of which the Company and its
Subsidiaries beneficially own or hold, in the aggregate, directly or
indirectly, 10% or more of any class of voting or equity interests.
As used in this definition, "Control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting securities, by
contract or otherwise. Unless the context otherwise clearly requires, any
reference to an "Affiliate" is a reference to an Affiliate of the Company.
"Agreement, this" is defined in Section 17.3.
"Anti-Terrorism Order" is defined in Section 5.16(b).
"Business Day" means any day other than a Saturday, a Sunday or a day on
which commercial banks in New York City are required or authorized to be closed.
"Cancellation Date" is defined in Section 2(c)(v).
"Cancellation Fee" is defined in Section 2(c)(v).
"Capital Lease" means a lease with respect to which the lessee is required
concurrently to recognize the acquisition of an asset and the incurrence of a
liability in accordance with GAAP.
"Capital Stock" means any class of capital stock, share capital or similar
equity interest of a Person.
"Closing" is defined in Section 3.
Schedule B
Page 1
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and the rules and regulations promulgated thereunder from time to time.
"Company" is defined in the introductory sentence of this Agreement.
"Confidential Information" is defined in Section 20.
"Confirmation of Acceptance" is defined in Section 2(b)(v).
"Consolidated" means the Company and its Subsidiaries on a consolidated
basis in accordance with GAAP.
"Consolidated Net Worth" means, at any time,
(a) the sum, without duplication, of (i) the par value (or value
stated on the books of the corporation) of the Capital Stock (but excluding
treasury stock and Capital Stock subscribed and unissued, and any Preferred
Stock that is mandatorily redeemable on or prior to the latest final
maturity of any Series of Notes) of the Company and its Subsidiaries, plus
(ii) the amount of the paid-in capital and retained earnings of the Company
and its Subsidiaries, in each case as such amounts (excluding the effect of
all foreign currency translation adjustments) would be shown on a
consolidated balance sheet of the Company and its Subsidiaries as of such
time prepared in accordance with GAAP, minus
(b) to the extent included in clause (a), all amounts properly
attributable to minority interests, if any, in the stock and surplus of
Subsidiaries.
"Consolidated Total Assets" means, at any time, the total assets of the
Company and its Subsidiaries which would be shown as assets on a consolidated
balance sheet of the Company and its Subsidiaries as of such time prepared in
accordance with GAAP, after eliminating all amounts properly attributable to
minority interests, if any, in the stock and surplus of Subsidiaries.
"Consolidated Total Capitalization" means, at any time, the sum of (a)
Consolidated Total Debt at such time plus (b) Consolidated Net Worth at such
time.
"Consolidated Total Debt" means, as of any date of determination, the total
of all Debt of the Company and its Subsidiaries outstanding on such date, after
eliminating all offsetting debits and credits between the Company and its
Subsidiaries and all other items required to be eliminated in the course of the
preparation of consolidated financial statements of the Company and its
Subsidiaries in accordance with GAAP.
"Credit Agreement" means that certain Credit Agreement, dated as of July
20, 2005, by and among the Company, certain Subsidiaries of the Company, the
banks that are parties thereto, and The Bank of New York, as administrative
agent, as amended or renewed from time to time, and each successor loan or
credit agreement constituting the Company's primary bank credit facility, with
the same or different group of lenders and agents, in each case as may be
amended from time to time.
Schedule B
Page 2
"Debt" means, with respect to any Person, without duplication,
(a) its liabilities for borrowed money and its redemption obligations
in respect of mandatorily redeemable Preferred Stock;
(b) its liabilities for the deferred purchase price of property
acquired by such Person (excluding accounts payable arising in the ordinary
course of business but including, without limitation, all liabilities
created or arising under any conditional sale or other title retention
agreement with respect to any such property);
(c) all liabilities appearing on its balance sheet in accordance with
GAAP in respect of Capital Leases;
(d) all liabilities for borrowed money secured by any Lien with
respect to any property owned by such Person (whether or not it has assumed
or otherwise become liable for such liabilities); and
(e) any Guaranty of such Person with respect to liabilities of a type
described in any of clauses (a) through (d) hereof.
Without limitation of the foregoing, Debt of any Person shall include all
obligations of such Person of the character described in clauses (a) through (e)
to the extent such Person or its property remains legally liable in respect
thereof notwithstanding that any such obligation is deemed to be extinguished
under GAAP.
"Debt Prepayment Application" is defined in Section 10.6(c)(i).
"Default" means an event or condition the occurrence or existence of which
would, with the lapse of time or the giving of notice or both, become an Event
of Default.
"Default Rate" means that rate of interest that is the greater of (i) 2.0%
per annum above the rate of interest stated in clause (a) of the first paragraph
of the relevant Series of Notes or (ii) 2.0% over the rate of interest publicly
announced from time to time by JPMorgan Chase Bank (or its successor) at its
headquarters as its "base" or "prime" rate.
"Delayed Delivery Fee" is defined in Section 2(c)(iv).
"Designated Portion" is defined in Section 10.6(b)(i).
"Disclosure Documents" are defined in Section 5.3.
"Disposition Value" is defined in Section 10.6(c)(ii).
"EBIT" means, for any period, the net income of the Company and its
Subsidiaries on a Consolidated basis for such period plus each of the following
with respect to the Company and its Subsidiaries on a Consolidated basis to the
extent utilized in determining such net income: (a) Interest Expense and (b)
provision for taxes.
Schedule B
Page 3
"Environmental Laws" means any and all Federal, state, local, and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses, agreements or governmental
restrictions relating to pollution and the protection of the environment or the
release of any materials into the environment, including but not limited to
those related to hazardous substances or wastes, air emissions and discharges to
waste or public systems.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the rules and regulations promulgated thereunder
from time to time in effect.
"ERISA Affiliate" means any trade or business (whether or not incorporated)
that is treated as a single employer together with the Company under section 414
of the Code.
"Event of Default" is defined in Section 11.
"Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time.
"Excluded Transfer" is defined in Section 10.6(a)(ii).
"Fair Market Value" means, at any time and with respect to any property,
the sale value of such property that would be realized in an arm's-length sale
at such time between an informed and willing buyer and an informed and willing
seller (neither being under a compulsion to buy or sell, respectively).
"Financing Documents" means, collectively, this Agreement, the Notes and
the Guaranty Agreement.
"Fixed Charge Coverage Ratio" means, at any time in respect to any Debt
with respect to which the Company or any Subsidiary is becoming liable, the
ratio of (a) (i) EBIT in respect of the period comprised of the four consecutive
fiscal quarters ended immediately prior to such time in respect of which
financial statements have been delivered pursuant to Sections 7.1(a) or 7.1(b)
plus (ii) Rent Expense for such period to (b) (i) Rent Expense for such period
plus (ii) Interest Expense for such period (assuming that the entire principal
amount of such Debt was incurred on the first day of such period and remained
outstanding at all times during such period and such Debt accrued interest at
the rate as would have been accrued on such Debt during such period).
"Foreign Pension Plan" means any plan, fund or other similar program
(a) established or maintained outside of the United States of America
by any one or more of the Company or any of its Subsidiaries primarily for
the benefit of the employees (substantially all of whom are aliens not
residing in the United States of America) of the Company or its
Subsidiaries which plan, fund or other similar program provides for
retirement income for such employees or results in a deferral of income for
such employees in contemplation of retirement, and
Schedule B
Page 4
(b) not otherwise subject to ERISA.
"GAAP" means generally accepted accounting principles as in effect from
time to time in the United States of America.
"Governmental Authority" means
(a) the government of
(i) the United States of America or any state or other political
subdivision thereof, or
(ii) any jurisdiction in which the Company or any Subsidiary
conducts all or any part of its business, or that asserts jurisdiction
over any properties of the Company or any Subsidiary, or
(b) any entity exercising executive, legislative, judicial, regulatory
or administrative functions of, or pertaining to, any such government.
"Guarantors" means each of ▇▇▇▇▇▇▇ and Company, a New York corporation,
▇▇▇▇▇▇▇ & Co. International, a Delaware corporation, ▇▇▇▇▇▇▇ & Co. Japan Inc., a
Delaware corporation, and each other Subsidiary of the Company which delivers a
Guaranty or joinder agreement to the Guaranty Agreement pursuant to Section 9.6
hereof, together with the respective successors and assigns of each of the
foregoing entities, and "Guarantor" means any one of such Persons.
"Guaranty" means, with respect to any Person, any obligation (except the
endorsement in the ordinary course of business of negotiable instruments for
deposit or collection) of such Person guaranteeing or in effect guaranteeing any
indebtedness, dividend or other obligation of any other Person in any manner,
whether directly or indirectly, including, without limitation, obligations
incurred through an agreement, contingent or otherwise, by such Person:
(a) to purchase such indebtedness or obligation or any property
constituting security therefor;
(b) to advance or supply funds (i) for the purchase or payment of such
indebtedness or obligation, or (ii) to maintain any working capital or
other balance sheet condition or any income statement condition of any
other Person or otherwise to advance or make available funds for the
purchase or payment of such indebtedness or obligation;
(c) to lease properties or to purchase properties or services
primarily for the purpose of assuring the owner of such indebtedness or
obligation of the ability of any other Person to make payment of the
indebtedness or obligation; or
(d) otherwise to assure the owner of such indebtedness or obligation
against loss in respect thereof.
Schedule B
Page 5
In any computation of the indebtedness or other liabilities of the obligor under
any Guaranty, the indebtedness or other obligations that are the subject of such
Guaranty shall be assumed to be direct obligations of such obligor.
"Guaranty Agreement" is defined in Section 4.6.
"Hazardous Material" means any and all pollutants, toxic or hazardous
wastes or any other substances that might pose a hazard to health or safety, the
removal of which may be required or the generation, manufacture, refining,
production, processing, treatment, storage, handling, transportation, transfer,
use, disposal, release, discharge, spillage, seepage, or filtration of which is
or shall be restricted, prohibited or penalized by any applicable law
(including, without limitation, asbestos, urea formaldehyde foam insulation and
polychlorinated biphenyls).
"holder" means, with respect to any Note, the Person in whose name such
Note is registered in the register maintained by the Company pursuant to Section
13.1.
"Hostile Tender Offer" means, with respect to the use of proceeds of any
Note, any offer to purchase, or any purchase of, shares of capital stock of any
corporation or equity interests in any other entity, or securities convertible
into or representing the beneficial ownership of, or rights to acquire, any such
shares or equity interests, if such shares, equity interests, securities or
rights are of a class which is publicly traded on any securities exchange or in
any over-the-counter market, other than purchases of such shares, equity
interests, securities or rights representing less than 5% of the equity
interests or beneficial ownership of such corporation or other entity for
portfolio investment purposes, and such offer or purchase has not been duly
approved by the board of directors of such corporation or the equivalent
governing body of such other entity prior to the date on which the Company makes
the Request for Purchase of such Note.
"Incorporated Provision" is defined in Section 10.7(a).
"Indebtedness" means, with respect to any Person, without duplication,
(a) its liabilities for borrowed money and its redemption obligations
in respect of mandatorily redeemable Preferred Stock;
(b) its liabilities for the deferred purchase price of property
acquired by such Person (excluding accounts payable arising in the ordinary
course of business but including all liabilities created or arising under
any conditional sale or other title retention agreement with respect to any
such property);
(c) all liabilities appearing on its balance sheet in accordance with
GAAP in respect of Capital Leases;
(d) all liabilities for borrowed money secured by any Lien with
respect to any property owned by such Person (whether or not it has assumed
or otherwise become liable for such liabilities);
Schedule B
Page 6
(e) all its liabilities in respect of letters of credit or instruments
serving a similar function issued or accepted for its account by banks and
other financial institutions (whether or not representing obligations for
borrowed money);
(f) Swaps of such Person; and
(g) any Guaranty of such Person with respect to liabilities of a type
described in any of clauses (a) through (f) hereof.
Without limitation of the foregoing, Indebtedness of any Person shall include
all obligations of such Person of the character described in clauses (a) through
(g) to the extent such Person or its property remains legally liable in respect
thereof notwithstanding that any such obligation is deemed to be extinguished
under GAAP.
"Institutional Investor" means (a) any original purchaser of a Note, (b)
any holder of a Note holding more than 5% of the aggregate principal amount of
the Notes then outstanding, and (c) any bank, trust company, savings and loan
association or other financial institution, any pension plan, any investment
company, any insurance company, any broker or dealer, or any other similar
financial institution or entity, regardless of legal form.
"Interest Expense" means, for any period, the interest expense of the
Company and its Subsidiaries on a Consolidated basis in respect of such period.
"Lien" means, with respect to any Person, any mortgage, lien, pledge,
charge, security interest or other encumbrance, or any interest or title of any
vendor, lessor, lender or other secured party to or of such Person under any
conditional sale or other title retention agreement or Capital Lease, upon or
with respect to any property or asset of such Person (including in the case of
stock, stockholder agreements, voting trust agreements and all similar
arrangements).
"Make-Whole Amount" is defined in Section 8.7.
"Material" means material in relation to the business, operations, affairs,
financial condition, assets, properties or prospects of the Company and its
Subsidiaries taken as a whole.
"Material Adverse Effect" means a material adverse effect on (a) the
business, operations, affairs, financial condition, assets or properties of the
Company and its Subsidiaries taken as a whole, or (b) the ability of the
Obligors to perform their obligations under the Financing Documents, or (c) the
validity or enforceability of any of the Financing Documents.
"Multiemployer Plan" means any Plan that is a "multiemployer plan" (as such
term is defined in section 4001(a)(3) of ERISA).
"Net Asset Sale Proceeds Amount" means, with respect to any Transfer of
any property by any Person, an amount equal to the difference of
(a) the aggregate amount of the consideration (valued at the Fair
Market Value of such consideration at the time of the consummation of such
Transfer) received by such Person in respect of such Transfer, minus
Schedule B
Page 7
(b) all ordinary and reasonable out-of-pocket costs and expenses
actually incurred by such Person in connection with such Transfer.
"Notes" is defined in Section 1.
"Obligors" means the Company and each Guarantor, and "Obligor" means any
one of such Persons.
"Officer's Certificate" means a certificate of the Company executed on its
behalf by a Senior Financial Officer or any other officer of the Company whose
responsibilities extend to the subject matter of such certificate.
"On-Going Business" means a distinct operating business, whether operated
as a division of a larger business operation or operated independently, which,
regardless of the form of legal entity, owns and operates the assets and has the
liabilities of such business.
"Ordinary Course Transfer" is defined in Section 10.6(a)(i).
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA or any successor thereto.
"Person" means an individual, partnership, corporation, limited liability
company, association, trust, unincorporated organization, or a government or
agency or political subdivision thereof.
"Plan" means an "employee benefit plan" (as defined in section 3(3) of
ERISA) that is or, within the preceding five years, has been established or
maintained, or to which contributions are or, within the preceding five years,
have been made or required to be made, by the Company or any ERISA Affiliate or
with respect to which the Company or any ERISA Affiliate may have any liability.
"Preferred Stock" means any class of Capital Stock of a Person that is
preferred over any other class of Capital Stock of such Person as to the payment
of dividends or other equity distributions or the payment of any amount upon
liquidation or dissolution of such Person.
"Priority Debt" means, at any time, without duplication, the sum of
(a) all then outstanding Debt of the Company or any Guarantor secured
by any Lien on any property of the Company or any Subsidiary, other than
any such Debt secured by Liens permitted by any one or more of clauses (a)
through (f), inclusive, of Section 10.4, plus
(b) all then outstanding Debt of Subsidiaries (other than Debt of any
Guarantor);
provided that Priority Debt shall not include (x) demand Debt of any Subsidiary
owing solely to the Company or another Subsidiary, (y) Debt of any Subsidiary
under any Guaranty by a Subsidiary which is a party to the Guaranty Agreement of
the Debt of the Company or any other Subsidiary or (z) Debt of any Subsidiary
under any of the agreements listed in Schedule 10.3.
Schedule B
Page 8
"property" or "properties" means, unless otherwise specifically limited,
real or personal property of any kind, tangible or intangible, ▇▇▇▇▇▇ or
inchoate.
"PTE" is defined in Section 6.2(a).
"Purchasers" is defined in the first paragraph of this Agreement.
"QPAM Exemption" is defined in Section 6.2(d).
"Qualified Institutional Buyer" means any Person who is a "qualified
institutional buyer" within the meaning of such term as set forth in Rule
144A(a)(1) under the Securities Act.
"Reinvested Transfer" is defined in Section 10.6(b)(i).
"Rent Expense" means, for any period, the rent expense of the Company and
its Subsidiaries under all operating leases on a Consolidated basis in respect
of such period.
"Required Holders" means, at any time, the holder or holders of at least
66-2/3% in principal amount of the Notes or of a Series of Notes, as the context
may require, at the time outstanding (exclusive of Notes then owned by the
Company, any Subsidiary or any of their respective Affiliates).
"Responsible Officer" means any Senior Financial Officer and any other
officer of the Company with responsibility for the administration of the
relevant portion of this Agreement.
"Securities Act" means the Securities Act of 1933, as amended from time to
time.
"Senior Debt" means the Notes and any Debt of the Company or its
Subsidiaries that by its terms is not in any manner subordinated in right of
payment to any other unsecured Debt of the Company or any Subsidiary.
"Senior Financial Officer" means the chief financial officer, senior vice
president-finance, principal accounting officer or treasurer of the Company.
"Series" means a series of Notes issued under this Agreement.
"Series A Notes" is defined in Section 1.
"Series B Notes" is defined in Section 1.
"Source" is defined in Section 6.2.
"Subsidiary" means, as to any Person, any corporation, partnership, limited
liability company, association or other business entity in which such Person or
one or more of its Subsidiaries or such Person and one or more of its
Subsidiaries owns sufficient equity or voting interests to enable it or them (as
Schedule B
Page 9
a group) ordinarily, in the absence of contingencies, to elect a majority of the
directors (or Persons performing similar functions) of such entity, and any
partnership or joint venture if more than a 50% interest in the profits or
capital thereof is owned by such Person or one or more of its Subsidiaries or
such Person and one or more of its Subsidiaries (unless such partnership or
joint venture can and does ordinarily take major business actions without the
prior approval of such Person or one or more of its Subsidiaries). Unless the
context otherwise clearly requires, any reference to a "Subsidiary" is a
reference to a Subsidiary of the Company.
"Substantial Portion" is defined in Section 10.6(c)(iii).
"Successor Corporation" is defined in Section 10.5(c)(i).
"Swaps" means, with respect to any Person, payment obligations with respect
to interest rate swaps, currency swaps and similar obligations obligating such
Person to make payments, whether periodically or upon the happening of a
contingency. For the purposes of this Agreement, the amount of the obligation
under any Swap shall be the amount determined in respect thereof as of the end
of the then most recently ended fiscal quarter of such Person, based on the
assumption that such Swap had terminated at the end of such fiscal quarter, and
in making such determination, if any agreement relating to such Swap provides
for the netting of amounts payable by and to such Person thereunder or if any
such agreement provides for the simultaneous payment of amounts by and to such
Person, then in each such case, the amount of such obligation shall be the net
amount so determined.
"Transfer" is defined in Section 10.6(c)(iv).
"Voting Stock" means, with respect to any corporation, any shares of stock
of such corporation whose holders are entitled under ordinary circumstances to
vote for the election of directors of such corporation (irrespective of whether
at the time stock of any other class or classes shall have or might have voting
power by reason of the happening of any contingency).
"Wholly-Owned Subsidiary" means, at any time, any Subsidiary of which (a)
100% of the Capital Stock of such Subsidiary is beneficially owned by any one or
more of the Company and the Company's other Wholly-Owned Subsidiaries at such
time and (b) all of the legal title to such Capital Stock (other than Capital
Stock held by third parties as may be required under the laws of any
jurisdiction where such Subsidiary is organized or conducts business) is held by
one or more of the Company and the Company's other Wholly-Owned Subsidiaries at
such time.
Schedule B
Page 10
SCHEDULE 5.15
EXISTING INDEBTEDNESS AND LIENS
-------------------------------
Excludes intercompany debt, which is consolidated in accordance with GAAP and
does not include any amounts owed to third parties.
1. Indebtedness under the Credit Agreement of up to $450,000,000, which may be
incurred by the Company, and those of its direct and indirect subsidiaries
that are or become parties thereto (unsecured; $339,300,264 outstanding).
2. Guarantees provided by each of the Guarantors of the indebtedness described
in Item 1 above (unsecured).
3. $40,000,000 7.05% Series B Senior Notes due 2010 issued by the Company to
certain purchasers thereof (unsecured; $40,000,000 outstanding).
4. Guarantees provided by each of the Guarantors of the indebtedness described
in Item 3 above (unsecured).
5. $40,000,000 6.15% Series C Senior Notes due 2009 issued by the Company to
certain purchasers thereof (unsecured; $40,000,000 outstanding).
6. Guarantees provided by each of the Guarantors of the indebtedness described
in Item 5 above (unsecured).
7. $60,000,000 6.56% Series D Senior Notes due 2012 issued by the Company to
certain purchasers thereof (unsecured; $60,000,000 outstanding).
8. Guarantees provided by each of the Guarantors of the indebtedness described
in Item 7 above (unsecured).
9. $100,000,000 9.05% Series A Senior Notes due 2015 issued by the Company to
certain purchasers thereof (unsecured; $100,000,000 outstanding).
10. Guarantees provided by each of the Guarantors of the indebtedness described
in Item 9 above (unsecured).
11. (Y)5,000,000,000 4.50% Loan due 2011 from American Family Life Assurance
Company of Columbus, Japan Branch (unsecured; (Y)5,000,000,000
outstanding).
12. Guaranty provided by the Company of the indebtedness described in Item 11
above (unsecured).
Schedule 5.15
Page 1
13. $1,000,000 uncommitted line of credit provided to ▇▇▇▇▇▇▇-Brasil Ltda. by
Banco ABN AMRO Real S.A. (unsecured; Zero outstanding).
14. Guaranty provided by the Company of the indebtedness described in Item 13
above (unsecured).
15. $1,000,000 uncommitted line of credit provided to Tiffany-Importacao e
Commercio de Joias Ltda. by Banco ABN AMRO Real S.A. (unsecured; Zero
outstanding).
16. Guaranty provided by the Company of the indebtedness described in Item 15
above (unsecured).
17. Forward exchange yen contracts, including those arising under that certain
Foreign Exchange and Options Master Agreement dated as of March 28, 1997,
by and between The Bank of New York and ▇▇▇▇▇▇▇ and Company ("FEOMA-1")
(unsecured) and that certain Foreign Exchange and Option Master Agreement
dated as of March 28, 1997, by and between The Bank of New York and ▇▇▇▇▇▇▇
& Co. International ("FEOMA-2") (unsecured). There is no outstanding
obligation on such Indebtedness as of the date of the Closing.
18. Guaranty provided by ▇▇▇▇▇▇▇ & Co. International of the indebtedness
arising under FEOMA-1 (unsecured). There is no outstanding obligation on
such Indebtedness as of the date of the Closing.
19. Guaranty provided by ▇▇▇▇▇▇▇ and Company of the indebtedness arising under
FEOMA-2 (unsecured). There is no outstanding obligation on such
Indebtedness as of the date of the Closing.
20. (Y)15,000,000,000 2.02% First Series Yen Bonds due 2010 issued by ▇▇▇▇▇▇▇ &
Co. Japan, Inc. to certain purchasers thereof (unsecured; (Y)15,000,000,000
outstanding).
21. Guaranty provided by the Company of the indebtedness described in Item 20
above (unsecured).
22. Master Swap Agreement dated as of July 18, 2002 and the Schedule to the
Master Agreement dated as of July 18, 2002 between ▇▇▇▇▇▇▇ & Co. and ▇▇▇▇▇▇
Brothers Special Financing Inc. 23. Guaranty provided by ▇▇▇▇▇▇▇ & Co.
International of the indebtedness arising from item 22 above.
24. Guaranty provided by ▇▇▇▇▇▇▇ & Co. Japan Inc. of the indebtedness arising
from item 22 above.
25. Guaranty provided by ▇▇▇▇▇▇▇ and Company of the indebtedness arising from
item 22 above.
26. $40,000,000 Interest Rate Swap between ▇▇▇▇▇▇ Brothers Special Financing
Inc, and ▇▇▇▇▇▇▇ & Co. beginning July 18, 2002 and terminating July 18,
2009.
Schedule 5.15
Page 2
27. $60,000,000 Interest Rate Swap between ▇▇▇▇▇▇ Brothers Special Financing
Inc. and ▇▇▇▇▇▇▇ & Co. beginning July 18, 2002 and terminating July 19,
2012.
28. (Y)6,500,000,000 Standby Credit Facility expiring March 31, 2009 provided
to ▇▇▇▇▇▇▇ & Co. Japan, Inc. by Mizuho Bank Ltd. (unsecured;
(Y)4,200,000,000 outstanding).
29. Guaranty provided by the Company of the indebtedness described in Item 28
above (unsecured).
30. RMB 71,000,000 Credit Line provided to ▇▇▇▇▇▇▇ & Co. (Shanghai) Commercial
Company Limited by Mizuho Corporate Bank (China) Ltd. (unsecured; RMB
62,000,000 outstanding).
31. Guaranty provided by the Company of the indebtedness described in Item 30
above (unsecured).
32. ZAR 10,000,000 Overdraft Line provided to Rand Precision Cut Diamonds (PTY)
by Nedbank Limited (unsecured; ZAR 6,097,861 outstanding).
33. $50,000,000 Promissory Note due March 31, 2009 issued by the Company to ABN
AMRO Bank, N.V. (unsecured; $50,000,000 outstanding).
34. (euro)600,000 Guarantee Credit Facility provided to ▇▇▇▇▇▇▇ and Company by
Dresdner Bank AG (unsecured; zero balance outstanding).
35. Various letters of credit issued to Subsidiaries of the Company
($22,300,000 aggregate outstanding).
*Stated principal amounts outstanding are as of December 31, 2008 unless stated
otherwise.
Schedule 5.15
Page 3
EXHIBIT 1A
[FORM OF SERIES A NOTE]
▇▇▇▇▇▇▇ & CO.
10% SERIES A-2009 SENIOR NOTE DUE FEBRUARY 13, 2017
No. RA-[__] [__________]
$[________] PPN: 886547 C*7
FOR VALUE RECEIVED, the undersigned, ▇▇▇▇▇▇▇ & CO. (herein called the
"Company"), a corporation organized and existing under the laws of the State of
Delaware, hereby promises to pay to [________________], or registered assigns,
the principal sum of [______________] DOLLARS ($[_________]) on February 13,
2017, with interest (computed on the basis of a 360-day year of twelve 30-day
months) (a) on the unpaid balance thereof at the rate of 10% per annum from the
date hereof, payable semiannually on the 13th day of August and February
(excluding February 13, 2009) each year, commencing on the August 13 or February
13 (excluding February 13, 2009) next succeeding the date hereof, until the
principal hereof shall have become due and payable, and (b) to the extent
permitted by law on any overdue payment (including any overdue prepayment) of
principal, any overdue payment of interest and any overdue payment of any
Make-Whole Amount (as defined in the Note Agreement referred to below), payable
quarterly as aforesaid (or, at the option of the registered holder hereof, on
demand), at a rate per annum from time to time equal to the greater of (i) 12%
or (ii) 2.0% over the rate of interest publicly announced from time to time by
JPMorgan Chase Bank (or its successor) at its headquarters as its "base" or
"prime" rate.
Payments of principal of, interest on and any Make-Whole Amount with
respect to this Note are to be made in lawful money of the United States of
America at the address shown in the register maintained by the Company for such
purpose or at such other place as the Company shall have designated by written
notice to the holder of this Note as provided in the Note Agreement referred to
below.
This Note is one of a series of the 10% Series A-2009 Senior Notes due
February 13, 2017 (herein called the "Notes") of the Company in the aggregate
principal amount of $125,000,000 issued pursuant to that certain Note Purchase
Agreement, dated as of February 12, 2009, (as from time to time amended, the
"Note Agreement"), between the Company and the respective purchasers named
therein. Each holder of this Note will be deemed, by its acceptance hereof, (i)
to have agreed to the confidentiality provisions set forth in Section 20 of the
Note Agreement and (ii) to have made the representation set forth in Section 6.2
of the Note Agreement. Capitalized terms used herein, unless otherwise specified
herein, shall have the respective meanings specified in the Note Agreement.
This Note is a registered Note and, as provided in the Note Agreement, upon
surrender of this Note for registration of transfer, duly endorsed, or
accompanied by a written instrument of transfer duly executed, by the registered
holder hereof or such holder's attorney duly authorized in writing, a new Note
for a like principal amount will be issued to, and registered in the name of,
Exhibit 1A
Page 1
the transferee. Prior to due presentment for registration of transfer, the
Company may treat the Person in whose name this Note is registered as the owner
hereof for the purpose of receiving payment and for all other purposes, and the
Company will not be affected by any notice to the contrary. This Note is not a
"negotiable instrument" within the meaning of ss.3-104 of the Uniform Commercial
Code as adopted in the State of New York.
This Note and the holder hereof are entitled, equally and ratably with the
holders of all other notes issued under the Note Agreement, to the benefits
provided by the Guaranty Agreement, as to which reference is hereby made for the
statement thereof.
This Note is subject to optional prepayment, in whole or from time to time
in part, at the times and on the terms specified in the Note Agreement, but not
otherwise.
If an Event of Default, as defined in the Note Agreement, occurs and is
continuing, the principal of this Note may be declared or otherwise become due
and payable in the manner, at the price (including any applicable Make-Whole
Amount) and with the effect provided in the Note Agreement.
THIS NOTE AND THE NOTE AGREEMENT ARE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK, EXCLUDING CHOICE-OF-LAW
PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE THE APPLICATION OF THE
LAWS OF A JURISDICTION OTHER THAN SUCH STATE.
▇▇▇▇▇▇▇ & CO.
By __________________________
Name:
Title:
Exhibit 1A
Page 2
EXHIBIT 1B
[FORM OF SERIES B NOTE]
▇▇▇▇▇▇▇ & CO.
10% SERIES B-2009 SENIOR NOTE DUE FEBRUARY 13, 2019
No. RB-[__] [__________]
$[________] PPN: 886547 C@5
FOR VALUE RECEIVED, the undersigned, ▇▇▇▇▇▇▇ & CO. (herein called the
"Company"), a corporation organized and existing under the laws of the State of
Delaware, hereby promises to pay to [________________], or registered assigns,
the principal sum of [______________] DOLLARS ($[_________]) on February 13,
2019, with interest (computed on the basis of a 360-day year of twelve 30-day
months) (a) on the unpaid balance thereof at the rate of 10% per annum from the
date hereof, payable semiannually on the 13th day of August and February
(excluding February 13, 2009) each year, commencing on the August 13 or February
13 (excluding February 13, 2009) next succeeding the date hereof, until the
principal hereof shall have become due and payable, and (b) to the extent
permitted by law on any overdue payment (including any overdue prepayment) of
principal, any overdue payment of interest and any overdue payment of any
Make-Whole Amount (as defined in the Note Agreement referred to below), payable
quarterly as aforesaid (or, at the option of the registered holder hereof, on
demand), at a rate per annum from time to time equal to the greater of (i) 12%
or (ii) 2.0% over the rate of interest publicly announced from time to time by
JPMorgan Chase Bank (or its successor) at its headquarters as its "base" or
"prime" rate.
Payments of principal of, interest on and any Make-Whole Amount with
respect to this Note are to be made in lawful money of the United States of
America at the address shown in the register maintained by the Company for such
purpose or at such other place as the Company shall have designated by written
notice to the holder of this Note as provided in the Note Agreement referred to
below.
This Note is one of a series of the 10% Series B-2009 Senior Notes due
February 13, 2019 (herein called the "Notes") of the Company in the aggregate
principal amount of $125,000,000 issued pursuant to that certain Note Purchase
Agreement, dated as of February 12, 2009, (as from time to time amended, the
"Note Agreement"), between the Company and the respective purchasers named
therein. Each holder of this Note will be deemed, by its acceptance hereof, (i)
to have agreed to the confidentiality provisions set forth in Section 20 of the
Note Agreement and (ii) to have made the representation set forth in Section 6.2
of the Note Agreement. Capitalized terms used herein, unless otherwise specified
herein, shall have the respective meanings specified in the Note Agreement.
This Note is a registered Note and, as provided in the Note Agreement, upon
surrender of this Note for registration of transfer, duly endorsed, or
accompanied by a written instrument of transfer duly executed, by the registered
holder hereof or such holder's attorney duly authorized in writing, a new Note
for a like principal amount will be issued to, and registered in the name of,
the transferee. Prior to due presentment for registration of transfer, the
Company may treat the Person in whose name this Note is registered as the owner
hereof for the purpose of receiving payment and for all other purposes, and the
Company will not be affected by any notice to the contrary. This Note is not a
"negotiable instrument" within the meaning of ss.3-104 of the Uniform Commercial
Code as adopted in the State of New York.
Exhibit 1B
Page 1
This Note and the holder hereof are entitled, equally and ratably with the
holders of all other notes issued under the Note Agreement, to the benefits
provided by the Guaranty Agreement, as to which reference is hereby made for the
statement thereof.
This Note is subject to optional prepayment, in whole or from time to time
in part, at the times and on the terms specified in the Note Agreement, but not
otherwise.
If an Event of Default, as defined in the Note Agreement, occurs and is
continuing, the principal of this Note may be declared or otherwise become due
and payable in the manner, at the price (including any applicable Make-Whole
Amount) and with the effect provided in the Note Agreement.
THIS NOTE AND THE NOTE AGREEMENT ARE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK, EXCLUDING CHOICE-OF-LAW
PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE THE APPLICATION OF THE
LAWS OF A JURISDICTION OTHER THAN SUCH STATE.
▇▇▇▇▇▇▇ & CO.
By __________________________
Name:
Title:
Exhibit 1B
Page 2
EXHIBIT 4.7
FORM OF GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT, dated as of February 12, 2009 (as amended,
restated or otherwise modified from time to time, this "Guaranty"), by ▇▇▇▇▇▇▇
and Company, a New York corporation, ▇▇▇▇▇▇▇ & Co. International, a Delaware
corporation and ▇▇▇▇▇▇▇ & Co. Japan Inc., a Delaware corporation (together with
their respective successors and assigns, the "Guarantors") is in favor of each
of the Noteholders (as such term is hereinafter defined).
1. PRELIMINARY STATEMENT
(a) ▇▇▇▇▇▇▇ & Co., a Delaware corporation (together with its
successors and assigns, the "Company"), has authorized the issuance of (i)
its 10% Series A-2009 Senior Notes due February 13, 2017 in the aggregate
principal amount of $125,000,000 (as amended, restated or otherwise
modified from time to time, together with any such Note issued in
substitution or replacement therefor, the "Series A Notes") and (ii) its
10% Series B-2009 Senior Notes due February 13, 2019 in the aggregate
principal amount of $125,000,000 (as amended, restated or otherwise
modified from time to time, together with any such Note issued in
substitution or replacement therefor, the "Series B Notes", and together
with the Series A Notes, the "Notes") pursuant to a Note Purchase
Agreement, of even date herewith (as may be amended, restated or otherwise
modified from time to time, the "Note Purchase Agreement'), between the
Company and, with respect to the Notes, the respective purchasers listed on
Schedule A attached thereto (the "Purchasers").
(b) In order to induce the Purchasers to purchase the Notes from the
Company, the Company has agreed that it will cause each Guarantor to
guaranty unconditionally all of the obligations of the Company to pay
principal of and interest and Make-Whole Amount on the Notes and all other
amounts payable by the Company under the terms of the Notes and the Note
Purchase Agreement pursuant to the terms and provisions hereof.
(c) Each Guarantor and the Company are operated as part of one
combined business group and are directly dependent upon each other for and
in connection with their respective business activities and their
respective financial resources. Each Guarantor will receive direct and
indirect economic, financial and other benefits from the indebtedness
incurred under the Note Purchase Agreement and the Notes by the Company,
and under this Guaranty by each Guarantor, and the incurrence of such
indebtedness is in the best interests of each Guarantor. The Company and
each Guarantor have induced the Purchasers to purchase the Notes based on
the consolidated financial condition of each Guarantor and the Company.
(d) All acts and proceedings required by law and by the certificate of
incorporation and bylaws of each Guarantor necessary to constitute this
Guaranty a valid and binding agreement for the uses and purposes set forth
herein in accordance with its terms have been done and taken, and the
execution and delivery hereof has been in all respects duly authorized.
Exhibit 4.7
Page 1
2. GUARANTY AND OTHER RIGHTS AND UNDERTAKINGS
2.1. Guarantied Obligations.
Each Guarantor, in consideration of the execution and delivery of the Note
Purchase Agreement, the purchase of the Notes by the Purchasers and other
consideration, hereby irrevocably, unconditionally, absolutely, jointly and
severally guarantees, on a continuing basis, to each holder of Notes (each such
holder being referred to herein as a "Noteholder" and, collectively, as the
"Noteholders"), whether such Note has been issued, is being issued on the date
hereof or is hereafter issued in compliance with the provisions of the Note
Purchase Agreement, as and for each Guarantor's own debt, until final and
indefeasible payment has been made in cash
(a) the due and punctual payment of the principal of and accrued and
unpaid interest (including, without limitation, interest which otherwise
may cease to accrue by operation of any insolvency law, rule, regulation or
interpretation thereof) and Make-Whole Amount, if any, and any other fees
and expenses, on the Notes at any time outstanding and the due and punctual
payment of all other amounts payable, and all other indebtedness owing, by
the Company to the Noteholders under the Note Purchase Agreement and the
Notes, in each case when and as the same shall become due and payable,
whether at maturity, pursuant to optional prepayment, by acceleration or
otherwise, all in accordance with the terms and provisions hereof and
thereof, including, without limitation, overdue interest, indemnification
payments and all reasonable costs and expenses incurred by the Noteholders
in connection with enforcing any obligations of the Company under the Note
Purchase Agreement and the Notes; it being the intent of each Guarantor
that the guaranty set forth herein shall be a continuing guaranty of
payment and not a guaranty of collection; and
(b) the prompt and complete payment, on demand, of any and all
reasonable costs and expenses incurred by the Noteholders in connection
with enforcing the obligations of such Guarantor hereunder, including,
without limitation, the reasonable fees and disbursements of the
Noteholders' special counsel.
All of the obligations set forth in clauses (a) and (b) of this Section 2.1 are
referred to herein as the "Guarantied Obligations" and the guaranty thereof
contained herein is referred to herein as the "Unconditional Guaranty." The
Unconditional Guaranty is a primary, original and immediate obligation of each
Guarantor and is an absolute, unconditional, continuing and irrevocable guaranty
of payment and performance and shall remain in full force and effect until the
full, final and indefeasible payment in cash of the Guarantied Obligations.
Exhibit 4.7
Page 2
2.2. Performance Under the Note Purchase Agreement.
In the event the Company fails to pay, perform, keep, observe, or fulfill
any Guarantied Obligation specified in clause (a) of Section 2.1 in the manner
provided in the Notes or in the Note Purchase Agreement, each Guarantor shall
cause forthwith to be paid the moneys in respect of which such failure has
occurred in accordance with the terms and provisions of the Note Purchase
Agreement and the Notes. In furtherance of the foregoing, if an Event of Default
shall exist, the Guarantied Obligations shall, in the manner and subject to the
limitations provided in the Note Purchase Agreement for the acceleration of the
Notes, forthwith become due and payable without notice, regardless of whether
the acceleration of the Notes shall be stayed, enjoined, delayed or otherwise
prevented.
2.3. Releases.
Each Guarantor consents and agrees that, without notice to or by any
Guarantor and without impairing, releasing, abating, deferring, suspending,
reducing, terminating or otherwise affecting the obligations of each Guarantor
hereunder, each Noteholder, in the manner provided herein, by action or
inaction, may:
(a) compromise or settle, renew or extend the period of duration or
the time for the payment, or discharge the performance of, or may refuse
to, or otherwise not, enforce, or may, by action or inaction, release all
or any one or more parties to, any one or more of the Notes, the Note
Purchase Agreement, any other guaranty thereof or agreement or instrument
related thereto or hereto;
(b) assign, sell or transfer, or otherwise dispose of, any one or more
of the Notes;
(c) grant waivers, extensions, consents and other indulgences to the
Company or any other Guarantor or guarantors in respect of any one or more
of the Notes, the Note Purchase Agreement, any other guaranty thereof or
any agreement or instrument related thereto or hereto;
(d) amend, modify or supplement in any manner and at any time (or from
time to time) any one or more of the Notes, the Note Purchase Agreement,
any other guaranty thereof or any agreement or instrument related hereto;
(e) release or substitute any one or more of the endorsers or
guarantors of the Guarantied Obligations whether parties hereto or not; and
(f) sell, exchange, release, surrender or enforce, by action or
inaction, any property at any time pledged or granted as security in
respect of the Guarantied Obligations, whether so pledged or granted by the
Company, each Guarantor or another guarantor of the Company's obligations
under the Note Purchase Agreement, the Notes, any other guaranty thereof or
any agreement or instrument related hereto.
Exhibit 4.7
Page 3
2.4. Waivers.
To the fullest extent permitted by law, each Guarantor does hereby waive:
(a) any notice of:
(i) acceptance of the Unconditional Guaranty;
(ii) any purchase of the Notes under the Note Purchase Agreement,
or the creation, existence or acquisition of any of the Guarantied
Obligations, or the amount of the Guarantied Obligations, subject to
each Guarantor' rights to make inquiry of each Noteholder to ascertain
the amount of the Guarantied Obligations owing to such Noteholder at
any reasonable time;
(iii) any adverse change in the financial condition of the
Company or any other fact that might increase, expand or affect each
Guarantor's risk hereunder;
(iv) presentment for payment, demand, protest, and notice thereof
as to the Notes or any other instrument;
(v) any Default or Event of Default; and
(vi) any notice or demand of any kind or nature whatsoever to
which each Guarantor might otherwise be entitled (except if such
notice or demand is specifically otherwise required to be given to
such Guarantor pursuant to the terms of this Guaranty);
(b) any right, by statute or otherwise, to require any Noteholder to
institute suit against the Company or any other guarantor or to exhaust the
rights and remedies of any Noteholder against the Company or any other
guarantor, each Guarantor being bound to the payment of each and all
Guarantied Obligations, whether now existing or hereafter accruing, as
fully as if such Guarantied Obligations were directly owing to the
Noteholders by each Guarantor;
(c) the benefit of any stay (except in connection with a pending
appeal), valuation, appraisal, redemption or extension law now or at any
time hereafter in force which, but for this waiver, might be applicable to
any sale of property of any Guarantor made under any judgment, order or
decree based on this Guaranty, and each Guarantor covenants that it will
not at any time insist upon or plead, or in any manner claim or take the
benefit or advantage of, such law; and
(d) any defense or objection to the absolute, primary, continuing
nature, or the validity, enforceability or amount of the Unconditional
Guaranty, including, without limitation, any defense based on (and the
primary, continuing nature, and the validity, enforceability and amount of
the Unconditional Guaranty shall be unaffected by), any of the following:
Exhibit 4.7
Page 4
(i) any change in future conditions;
(ii) any change of law;
(iii) any invalidity or irregularity with respect to the issuance
or assumption of any obligations (including, without limitation, the
Note Purchase Agreement, the Notes or any agreement or instrument
related hereto) by the Company or any other Person;
(iv) the execution and delivery of any agreement at any time
hereafter (including, without limitation, the Note Purchase Agreement,
the Notes or any agreement or instrument related hereto) of the
Company or any other Person;
(v) the genuineness, validity, regularity or enforceability of
any of the Guarantied Obligations;
(vi) any default, failure or delay, willful or otherwise, in the
performance of any obligations by the Company or any Guarantor;
(vii) any creditors' rights, bankruptcy, receivership or other
insolvency proceeding of the Company or any Guarantor, or
sequestration or seizure of any property of the Company or any
Guarantor, or any merger, consolidation, reorganization, dissolution,
liquidation or winding up or change in corporate constitution or
corporate identity or loss of corporate identity of the Company or any
Guarantor;
(viii) any disability or other defense of the Company or any
Guarantor to payment and performance of all Guarantied Obligations
other than the defense that the Guarantied Obligations shall have been
fully and finally performed and indefeasibly paid in cash;
(ix) the cessation from any cause whatsoever of the liability of
the Company or any Guarantor in respect of the Guarantied Obligations
(other than as provided herein), and any other defense that any
Guarantor may otherwise have against the Company or any Noteholder;
(x) impossibility or illegality of performance on the part of the
Company or any Guarantor under the Note Purchase Agreement, the Notes
or this Guaranty;
(xi) any change of the circumstances of the Company, any
Guarantor or any other Person, whether or not foreseen or foreseeable,
whether or not imputable to the Company or any Guarantor, including,
without limitation, impossibility of performance through fire,
Exhibit 4.7
Page 5
explosion, accident, labor disturbance, floods, droughts, embargoes,
wars (whether or not declared), civil commotions, acts of God or the
public enemy, delays or failure of suppliers or carriers, inability to
obtain materials, economic or political conditions, or any other
causes affecting performance, or any other force majeure, whether or
not beyond the control of the Company or any Guarantor and whether or
not of the kind hereinbefore specified;
(xii) any attachment, claim, demand, charge, Lien, order,
process, encumbrance or any other happening or event or reason,
similar or dissimilar to the foregoing, or any withholding or
diminution at the source, by reason of any taxes, assessments,
expenses, indebtedness, obligations or liabilities of any character,
foreseen or unforeseen, and whether or not valid, incurred by or
against any Person, or any claims, demands, charges, Liens or
encumbrances of any nature, foreseen or unforeseen, incurred by any
Person, or against any sums payable under the Note Purchase Agreement
or the Notes or any agreement or instrument related hereto so that
such sums would be rendered inadequate or would be unavailable to make
the payment as herein provided;
(xiii) any change in the ownership of the equity securities of
the Company, any Guarantor or any other Person liable in respect of
the Notes; or
(xiv) any other action, happening, event or reason whatsoever
that shall delay, interfere with, hinder or prevent, or in any way
adversely affect, the performance by the Company or any Guarantor of
any of their obligations under the Note Purchase Agreement, the Notes
or this Guaranty.
2.5. Certain Waivers of Subrogation, Reimbursement and Indemnity.
Each Guarantor hereby acknowledges and agrees that:
(a) no Guarantor shall have any right of subrogation, contribution,
reimbursement, or indemnity whatsoever in respect of the Guarantied
Obligations, and no right of recourse to or with respect to any assets or
property of the Company;
(b) no Guarantor will file any claims against the Company or the
estate of the Company in the course of any proceeding under any applicable
bankruptcy or insolvency law in respect of the rights referred to in this
Section 2.5; and
(c) each holder of Notes may specifically enforce the provisions of
this Section.
Exhibit 4.7
Page 6
2.6. Indemnity.
As a separate, additional and continuing obligation, each Guarantor
unconditionally and irrevocably undertakes and agrees with the Noteholders that,
should the Guarantied Obligations not be recoverable from any Guarantor for any
reason whatsoever (including, without limitation, by reason of any provision of
the Note Purchase Agreement, the Notes or any other agreement or instrument
executed in connection therewith being or becoming void, unenforceable or
otherwise invalid under any applicable law) then, notwithstanding any knowledge
thereof by any Noteholder at any time, each Guarantor as sole, original and
independent obligor, upon demand by the Noteholders, will make payment of the
Guarantied Obligations to the Noteholders by way of a full indemnity in such
currency and otherwise in such manner as is provided in the Note Purchase
Agreement and the Notes.
2.7. Invalid Payments.
Each Guarantor further agrees that, to the extent the Company makes a
payment or payments to any Noteholder, which payment or payments or any part
thereof are subsequently invalidated, declared to be fraudulent or preferential,
set aside or required, for any of the foregoing reasons or for any other reason,
to be repaid or paid over to a custodian, trustee, receiver or any other party
or officer under any bankruptcy, reorganization, arrangement, insolvency,
readjustment of debt, dissolution or liquidation law of any jurisdiction, state
or federal law, or any common law or equitable cause, then to the extent of such
payment or repayment, the obligation or part thereof intended to be satisfied
shall be revived and continued in full force and effect as if said payment had
not been made and each Guarantor shall be primarily liable for such obligation.
2.8. Marshaling.
Each Guarantor consents and agrees that each Noteholder, and each Person
acting for the benefit of each Noteholder, shall be under no obligation to
marshal any assets in favor of any Guarantor or against or in payment of any or
all of the Guarantied Obligations.
2.9. Subordination, Subrogation, Etc.
Each Guarantor agrees that any present or future indebtedness, obligations
or liabilities of the Company to any Guarantor shall be fully subordinate and
junior in right and priority of payment to any present or future indebtedness,
obligations or liabilities of the Company to the Noteholders. Each Guarantor
waives any right of subrogation to the rights of the Noteholders against the
Company or any other Person obligated for payment of the Guarantied Obligations
and any right of reimbursement, contribution or indemnity whatsoever (including,
without limitation, any such right as against any other guarantor) arising or
accruing out of any payment that any Guarantor may make pursuant to this
Guaranty, and any right of recourse to security for the debts and obligations of
the Company, unless and until the entire amount of the Guarantied Obligations
shall have been paid in full.
2.10. Subordination of Affiliate Obligations.
In the event that, for any reason whatsoever, the Company or a Person
obligated in respect of the Guarantied Obligations pursuant to another guaranty,
is now or hereafter becomes indebted to any Guarantor in any manner (an
"Affiliate Obligation"), such Guarantor agrees that the amount of such Affiliate
Obligation, interest thereon, and all other amounts due with respect thereto,
shall, at all times during the existence of a Default or an Event of Default, be
Exhibit 4.7
Page 7
subordinate as to time of payment and in all other respects to all the
Guarantied Obligations, and that such Guarantor shall not be entitled to enforce
or receive payment thereof until all sums then due and owing to the Noteholders
in respect of the Guarantied Obligations shall have been paid in full, except
that such Guarantor may enforce any obligations in respect of any such Affiliate
Obligation owing to such Guarantor from the Company or such indebted Person so
long as all proceeds in respect of any recovery from such enforcement, to the
extent of all amounts owing with respect to this Guaranty, shall be held by such
Guarantor in trust for the benefit of the Noteholders. If any other payment,
other than pursuant to the immediately preceding sentence, shall have been made
to any Guarantor by the Company or such indebted Person on any such Affiliate
Obligation during any time that a Default or an Event of Default exists and
there are Guarantied Obligations outstanding, such Guarantor shall hold in trust
all such payments, to the extent of all amounts owing with respect to this
Guaranty, for the benefit of the Noteholders.
2.11. Set-off, Counterclaim or Other Deductions.
Except as otherwise required by law, each payment by any Guarantor shall be
made without set-off, counterclaim or other deduction.
2.12. Election by Guarantors to Perform Obligations.
Any election by any Guarantor to pay or otherwise perform any of the
obligations of the Company under the Notes, the Note Purchase Agreement or any
agreement or instrument related hereto shall not release the Company, such
Guarantor or any other guarantor from such obligations or any of such Person's
other obligations under the Notes, the Note Purchase Agreement or any agreement
or instrument related hereto.
2.13. No Election of Remedies by Noteholders.
Each Noteholder shall, individually or collectively, have the right to seek
recourse against any Guarantor to the fullest extent provided for herein for
such Guarantor's obligations under this Guaranty in respect of the Guarantied
Obligations. No election to proceed in one form of action or proceeding, or
against any party, or on any obligation, shall constitute a waiver of such
Noteholder's right to proceed in any other form of action or proceeding or
against other parties unless such Noteholder has expressly waived such right in
writing. Specifically, but without limiting the generality of the foregoing, no
action or proceeding by any Noteholder against the Company or any Guarantor
under any document or instrument evidencing obligations of the Company or any
Guarantor to such Noteholder shall serve to diminish the liability of any
Guarantor under this Guaranty, except to the extent that such Noteholder finally
and unconditionally shall have realized payment by such action or proceeding.
2.14. Separate Action; Other Enforcement Rights.
Each of the rights and remedies granted under this Guaranty to each
Noteholder in respect of the Notes held by such Noteholder may be exercised by
such Noteholder with notice by such Noteholder to, but without the consent of or
any other action by, any other Noteholder; provided, however, that the maturity
Exhibit 4.7
Page 8
of the Notes may only be accelerated in accordance with the provisions of the
Note Purchase Agreement or operation of law. Each Noteholder may proceed to
protect and enforce the Unconditional Guaranty by suit or suits or proceedings
in equity, at law or in bankruptcy, and whether for the specific performance of
any covenant or agreement contained herein or in execution or aid of any power
herein granted or for the recovery of judgment for the obligations hereby
guarantied or for the enforcement of any other proper, legal or equitable remedy
available under applicable law.
2.15. Noteholder Set-off.
Each Noteholder shall have, to the fullest extent permitted by law and this
Guaranty, a right of set-off against any and all credits and any and all other
property of any or all of the Guarantors or any other Person, now or at any time
whatsoever, with or in the possession of, such Noteholder, or anyone acting for
such Noteholder, to ensure the full performance of any and all obligations of
each Guarantor hereunder.
2.16. Delay or Omission; No Waiver.
No course of dealing on the part of any Noteholder and no delay or failure
on the part of any such Person to exercise any right hereunder shall impair such
right or operate as a waiver of such right or otherwise prejudice such Person's
rights, powers and remedies hereunder. Every right and remedy given by the
Unconditional Guaranty or by law to any Noteholder may be exercised from time to
time as often as may be deemed expedient by such Person.
2.17. Restoration of Rights and Remedies.
If any Noteholder shall have instituted any proceeding to enforce any right
or remedy under the Unconditional Guaranty or under any Note held by such
Noteholder, and such proceeding shall have been dismissed, discontinued or
abandoned for any reason, or shall have been determined adversely to such
Noteholder, then and in every such case each such Noteholder, the Company and
each Guarantor shall, except as may be limited or affected by any determination
(including, without limitation, any determination in connection with any such
dismissal) in such proceeding, be restored severally and respectively to its
respective former positions hereunder and thereunder, and thereafter, subject as
aforesaid, the rights and remedies of such Noteholders shall continue as though
no such proceeding had been instituted.
2.18. Cumulative Remedies.
No remedy under this Guaranty, the Note Purchase Agreement or the Notes is
intended to be exclusive of any other remedy, but each and every remedy shall be
cumulative and in addition to any and every other remedy given pursuant to this
Guaranty, the Note Purchase Agreement or the Notes.
Exhibit 4.7
Page 9
2.19. Notices in Respect of Payments.
If any Guarantor shall pay to any Noteholder any amount in respect of the
Guarantied Obligations, such Guarantor, within five (5) Business Days after
making such payment, shall provide notice of such payment to each other
Noteholder.
2.20. Limitation on Guarantied Obligation.
Notwithstanding anything in Section 2.1 or elsewhere in this Guaranty, the
Note Purchase Agreement or the Notes to the contrary, the obligations of each
Guarantor hereunder shall at each point in time be limited to an aggregate
amount equal to the greatest amount that would not result in such obligations
being subject to avoidance, or otherwise result in such obligations being
unenforceable, at such time under applicable law (including, without limitation,
to the extent, and only to the extent, applicable to each Guarantor, Section 548
of the Bankruptcy Code of the United States of America and any comparable
provisions of the law of any other jurisdiction, any capital preservation law of
any jurisdiction and any other law of any jurisdiction that at such time limits
the enforceability of the obligations of such Guarantor hereunder).
2.21. Confirmation of Guaranty.
Promptly following the request of any holder of Notes in connection with
any issuance of additional Notes pursuant to the terms of the Note Purchase
Agreement, each Guarantor agrees to confirm in writing that the Unconditional
Guaranty hereunder extends to the obligations of the Company evidenced by such
newly issued Notes, and that such Notes are Guarantied Obligations hereunder.
3. INTERPRETATION OF THIS GUARANTY
3.1. Terms Defined.
For purposes of this Guaranty, the following terms have the meanings
specified below or provided for in the Section of this Guaranty referred to
immediately following such term (such definitions to be equally applicable to
both the singular and plural forms of the terms defined). Capitalized terms used
herein and not otherwise defined herein have the meaning specified in the Note
Purchase Agreement.
Affiliate Obligation -- Section 2.10.
Company -- Section 1(a).
Guarantied Obligations -- Section 2.1.
Guarantors -- has the meaning assigned to such term in the introductory
paragraph hereof.
Note Purchase Agreement -- Section 1(a).
Exhibit 4.7
Page 10
Noteholder -- Section 2.1.
Notes -- Section 1(a).
Person -- means an individual, partnership, corporation, limited liability
company, association, trust, unincorporated organization, or a government or
agency or political subdivision thereof.
Purchasers -- Section 1(a).
Series A Notes -- Section 1(a).
Series B Notes -- Section 1(a).
Unconditional Guaranty -- Section 2.1.
3.2. Section Headings and Construction.
(a) Section Headings, etc. The titles of the Sections appear as a
matter of convenience only, do not constitute a part hereof and shall not
affect the construction hereof. The words "herein," "hereof," "hereunder"
and "hereto" refer to this Guaranty as a whole and not to any particular
Section or other subdivision.
(b) Construction. Each covenant contained herein shall be construed
(absent an express contrary provision herein) as being independent of each
other covenant contained herein, and compliance with any one covenant shall
not (absent such an express contrary provision) be deemed to excuse
compliance with one or more other covenants.
4. WARRANTIES AND REPRESENTATIONS
Guarantors warrant and represent, as of the date hereof, that each of
the warranties and representations made by the Company in Section 5 of the
Note Purchase Agreement with respect to each Guarantor are true with
respect to each Guarantor on the date hereof.
5. GENERAL COVENANTS
Each Guarantor covenants and agrees that on and after the date hereof
and so long as any of the Guarantied Obligations shall be outstanding:
Exhibit 4.7
Page 11
5.1. Undertakings in the Note Purchase Agreement.
Each Guarantor will comply with each of the undertakings of the Company in
the Note Purchase Agreement in respect of which the Company undertakes to cause
such Guarantor to comply with such undertakings, as if such undertakings (as
they apply to the Guarantors) were set forth at length herein as the
undertakings of such Guarantor.
5.2. Payment of Notes and Maintenance of Offices.
Each Guarantor will punctually pay, or cause to be paid, all of the
Guarantied Obligations when due and all other payment obligations required of it
hereunder and will maintain an office at its address as set forth pursuant to
Section 6.3 where notices, presentations and demands in respect of this Guaranty
may be made upon it. Such office will be maintained at such address until such
time as such Guarantor shall notify the Noteholders of any change of location of
such office.
5.3. Further Assurances.
Each Guarantor will cooperate with the Noteholders and execute such further
instruments and documents as the Noteholders shall reasonably request to carry
out, to the reasonable satisfaction of the Noteholders, the transactions
contemplated by the Note Purchase Agreement, the Notes and this Guaranty.
6. MISCELLANEOUS
6.1. Successors and Assigns.
(a) Whenever any Guarantor or any of the parties to the Note Purchase
Agreement is referred to, such reference shall be deemed to include the
successors and assigns of such party, and all the covenants, promises and
agreements contained in this Guaranty by or on behalf of such Guarantor
shall bind the successors and assigns of such Guarantor and shall inure to
the benefit of each of the Noteholders from time to time whether so
expressed or not and whether or not an assignment of the rights hereunder
shall have been delivered in connection with any assignment or other
transfer of Notes.
(b) Each Guarantor agrees to take such action as may be reasonably
requested by any Noteholder in connection with the purchase by such
Noteholder or the transfer of the Notes of such Noteholder in accordance
with the requirements of the Note Purchase Agreement in connection with
providing an executed copy of this Guaranty to the new Noteholder or
Noteholders of such Notes; provided, however, that no additional
obligations of such Guarantor shall thereby be created (beyond what is
provided by this Guaranty).
Exhibit 4.7
Page 12
6.2. Partial Invalidity.
The unenforceability or invalidity of any provision or provisions
hereof shall not render any other provision or provisions contained herein
unenforceable or invalid.
6.3. Communications.
All communications hereunder shall be in writing, shall be delivered in the
manner required by the Note Purchase Agreement, and shall be addressed, if to
any Guarantor, at the applicable address set forth on Annex 1 hereto, and if to
any of the Noteholders:
(a) if such Noteholder is a Purchaser, at the address for such
Noteholder set forth on Schedule A to the Note Purchase Agreement, and
further including any parties referred to on such schedules (which are
required to receive notices in addition to such Noteholder, and
(b) if such Noteholder is not a Purchaser, at the address for such
Noteholder set forth in the register for the registration and transfer of
Notes maintained pursuant to Section 13.1 of the Note Purchase Agreement,
or to any such party at such other address as such party may designate by notice
duly given in accordance with this Section 6.3. Notices shall be deemed given
only when actually received.
6.4. Governing Law.
THIS GUARANTY SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK.
6.5. Effective Date.
This Guaranty shall be effective as of the date first written above.
6.6. Benefits of Guaranty Restricted to Noteholders.
Nothing express or implied in this Guaranty is intended or shall be
construed to give to any Person other than each Guarantor and the Noteholders
any legal or equitable right, remedy or claim under or in respect hereof or any
covenant, condition or provision therein or herein contained; and all such
covenants, conditions and provisions are and shall be held to be for the sole
and exclusive benefit of each Guarantor and the Noteholders.
6.7. Survival of Representations and Warranties.
All representations and warranties contained herein or made in writing by
each Guarantor in connection herewith shall survive the execution and delivery
hereof.
Exhibit 4.7
Page 13
6.8. Expenses.
(a) Each Guarantor shall pay when billed the reasonable costs and
expenses (including reasonable attorneys' fees) incurred by the Noteholders
in connection with the consideration, negotiation, preparation or execution
of any amendments, waivers, consents, standstill agreements and other
similar agreements with respect hereto (whether or not any such amendments,
waivers, consents, standstill agreements or other similar agreements are
executed).
(b) At any time when any of the Company or the Guarantors and the
Noteholders are conducting restructuring or workout negotiations in respect
hereof, or a Default or Event of Default exists, each Guarantor shall pay
when billed the reasonable costs and expenses (including reasonable
attorneys' fees of one firm of attorneys and the reasonable fees of one
firm of professional advisors) incurred by the Noteholders in connection
with the assessment, analysis or enforcement of any rights or remedies that
are or may be available to the Noteholders.
(c) If each Guarantor shall fail to pay when due any principal of, or
interest on, or any other amount due in respect of any Note, each Guarantor
shall pay to each Noteholder, to the extent permitted by law, such amounts
as shall be sufficient to cover the costs and expenses, including but not
limited to reasonable attorneys' fees, incurred by such Noteholder in
collecting any sums due on the Notes.
6.9. Amendment.
This Guaranty may be amended only in a writing executed by each Guarantor
and each Noteholder.
6.10. Survival.
So long as the Guarantied Obligations and all payment obligations of each
Guarantor hereunder shall not have been fully and finally performed and
indefeasibly paid, the obligations of each Guarantor hereunder shall survive the
transfer and payment of any Note and the payment in full of all the Notes.
6.11. Entire Agreement.
This Guaranty constitutes the final written expression of all of the terms
hereof and is a complete and exclusive statement of those terms.
6.12. Duplicate Originals.
Exhibit 4.7
Page 14
Two or more duplicate counterpart originals hereof may be signed by the
parties, each of which shall be an original but all of which together shall
constitute one and the same instrument.
6.13. Waiver of Jury Trial; Consent to Jurisdiction; Etc.
(a) Waiver of Jury Trial. THE PARTIES HERETO VOLUNTARILY AND
INTENTIONALLY WAIVE ANY RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY LITIGATION ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS
GUARANTY OR ANY OF THE DOCUMENTS, AGREEMENTS OR TRANSACTIONS CONTEMPLATED
HEREBY.
(b) Consent to Jurisdiction. ANY SUIT, ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO THIS GUARANTY, OR ANY OF THE DOCUMENTS, AGREEMENTS OR
TRANSACTIONS CONTEMPLATED HEREBY OR ANY ACTION OR PROCEEDING TO EXECUTE OR
OTHERWISE ENFORCE ANY JUDGMENT IN RESPECT OF ANY BREACH UNDER THIS GUARANTY
OR ANY DOCUMENT OR AGREEMENT CONTEMPLATED HEREBY MAY BE BROUGHT BY SUCH
PARTY IN ANY FEDERAL DISTRICT COURT LOCATED IN NEW YORK CITY, NEW YORK, OR
ANY NEW YORK STATE COURT LOCATED IN NEW YORK CITY, NEW YORK AS SUCH PARTY
MAY IN ITS SOLE DISCRETION ELECT, AND BY THE EXECUTION AND DELIVERY OF THIS
GUARANTY, THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMIT TO THE
NON-EXCLUSIVE IN PERSONAM JURISDICTION OF EACH SUCH COURT, AND EACH OF THE
PARTIES HERETO IRREVOCABLY WAIVES AND AGREES NOT TO ASSERT IN ANY
PROCEEDING BEFORE ANY TRIBUNAL, BY WAY OF MOTION, AS A DEFENSE OR
OTHERWISE, ANY CLAIM THAT IT IS NOT SUBJECT TO THE IN PERSONAM JURISDICTION
OF ANY SUCH COURT IN ADDITION, EACH OF THE PARTIES HERETO IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION THAT IT MAY
NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE IN ANY SUIT, ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY OR ANY DOCUMENT,
AGREEMENT OR TRANSACTION CONTEMPLATED HEREBY BROUGHT IN ANY SUCH COURT, AND
HEREBY IRREVOCABLY WAIVES ANY CLAIM THAT ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM.
Exhibit 4.7
Page 15
(c) Service of Process. EACH PARTY HERETO IRREVOCABLY AGREES THAT
PROCESS PERSONALLY SERVED OR SERVED BY U.S. REGISTERED MAIL AT THE
ADDRESSES PROVIDED HEREIN FOR NOTICES SHALL CONSTITUTE, TO THE EXTENT
PERMITTED BY LAW, ADEQUATE SERVICE OF PROCESS IN ANY SUIT, ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY OR ANY DOCUMENT,
AGREEMENT OR TRANSACTION CONTEMPLATED HEREBY, OR ANY ACTION OR PROCEEDING
TO EXECUTE OR OTHERWISE ENFORCE ANY JUDGMENT IN RESPECT OF ANY BREACH
HEREUNDER OR UNDER ANY DOCUMENT OR AGREEMENT CONTEMPLATED HEREBY. RECEIPT
OF PROCESS SO SERVED SHALL BE CONCLUSIVELY PRESUMED AS EVIDENCED BY A
DELIVERY RECEIPT FURNISHED BY THE UNITED STATES POSTAL SERVICE OR ANY
COMMERCIAL DELIVERY SERVICE.
(d) Other Forums. NOTHING HEREIN SHALL IN ANY WAY BE DEEMED TO LIMIT
THE ABILITY OF ANY HOLDER OF NOTES TO SERVE ANY WRITS, PROCESS OR SUMMONSES
IN ANY MANNER PERMITTED BY APPLICABLE LAW OR TO OBTAIN JURISDICTION OVER
ANY GUARANTOR IN SUCH OTHER JURISDICTION, AND IN SUCH OTHER MANNER, AS MAY
BE PERMITTED BY APPLICABLE LAW.
[Remainder of page intentionally left blank. Next page is signature page.]
Exhibit 4.7
Page 16
IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be
executed on each Guarantor's behalf by a duly authorized officer of each
such Guarantor.
▇▇▇▇▇▇▇ AND COMPANY
By:
------------------------------------
Name:
Title:
▇▇▇▇▇▇▇ & CO. INTERNATIONAL
By:
------------------------------------
Name:
Title:
▇▇▇▇▇▇▇ & CO. JAPAN INC.
By:
------------------------------------
Name:
Title:
Exhibit 4.7 - 17
ANNEX 1
ADDRESSES OF GUARANTORS
▇▇▇▇▇▇▇ and Company
c/o ▇▇▇▇▇▇▇ & Co.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Chief Financial Officer
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ & Co. International
c/o ▇▇▇▇▇▇▇ & Co.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Chief Financial Officer
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ & Co. Japan Inc.
c/o ▇▇▇▇▇▇▇ & Co.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Chief Financial Officer
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
