EXECUTION COUNTERPART
▇▇▇▇▇▇▇ FURNITURE COMPANY, INC.
NOTE PURCHASE AND PRIVATE SHELF AGREEMENT
$10,000,000
7.57% SERIES A SENIOR NOTES DUE JUNE 29, 2005
$15,000,000
PRIVATE SHELF FACILITY
Dated as of June 29, 1995
▇▇▇▇▇▇▇ FURNITURE COMPANY, INC.
▇.▇. ▇▇▇ ▇▇
▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
As of June 29, 1995
The Prudential Insurance Company
of America (Prudential)
Each Prudential Affiliate (as hereinafter defined) which becomes bound by
certain provisions of this Agreement
as hereinafter provided (together with Prudential (the Purchasers)
c/o Prudential Capital Group
Four Gateway Center
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
The undersigned, ▇▇▇▇▇▇▇ Furniture Company, Inc. (herein called the
Company), hereby agrees with you as follows:
1. AUTHORIZATION OF ISSUE OF NOTES.
1A. Authorization of Issue of Series A Notes. The Company will
authorize
the issue of its senior promissory notes (the Series A Notes) in the
aggregate
principal amount of $10,000,000, to be dated the date of issue thereof, to
mature
June 29, 2005, to bear interest on the unpaid balance thereof from the date
thereof
until the principal thereof shall have become due and payable at the rate of
7.57%
per annum and on overdue principal, Yield-Maintenance Amount and interest at
the rate specified therein, and to be substantially in the form of Exhibit
A-1
attached hereto. The terms Series A Note and Series A Notes as used
herein
shall include each Series A Note delivered pursuant to any provision of this
Agreement and each Series A Note delivered in substitution or exchange for
any
such Series A Note pursuant to any such provision.
1B. Authorization of Issue of Shelf Notes. The Company will
authorize
the issue of its additional senior promissory notes (the Shelf Notes) in
the
aggregate principal amount of $15,000,000, to be dated the date of issue
thereof,
to mature, in the case of each Shelf Note so issued, no more than ten years
after
the date of original issuance thereof, to have an average life, in the case
of each
Shelf Note so issued, of no more than 7 years after the date of original
issuance
thereof, to bear interest on the unpaid balance thereof from the date thereof
at the
rate per annum, and to have such other particular terms, as shall be set
forth, in the
case of each Shelf Note so issued, in the Confirmation of Acceptance with
respect
to such Shelf Note delivered pursuant to paragraph 2B(6) and to be
substantially
in the form of Exhibit A-2 attached hereto. The terms Shelf Note and
Shelf
Notes as used herein shall include each Shelf Note delivered pursuant to any
provision of this Agreement and each Shelf Note delivered in substitution or
exchange for any such Shelf Note pursuant to any such provision. The terms
Note and Notes as used herein shall include each Series A Note and each
Shelf Note delivered pursuant to any provision of this Agreement and each
Note
delivered in substitution or exchange for any such Note pursuant to any such
provision. Notes which have (i) the same final maturity, (ii) the same
principal
prepayment dates, (iii) the same principal prepayment amounts (as a
percentage of
the original principal amount of each Note), (iv) the same interest rate, (v)
the
same interest payment periods and (vi) the same date of issuance (which, in
the
case of a Note issued in exchange for another Note, shall be deemed for these
purposes the date on which such Note's ultimate predecessor Note was issued),
are
herein called a Series of Notes.
2. PURCHASE AND SALE OF NOTES.
2A. Purchase and Sale of Series A Notes. The Company hereby agrees
to
sell to Prudential and, subject to the terms and conditions herein set forth,
Prudential agrees to purchase from the Company $10,000,000 aggregate
principal
amount of Series A Notes at 100% of such aggregate principal amount. On
June 29, 1995 (herein called the Series A Closing Day), the Company will
deliver to Prudential at the offices of King & Spalding, 120 West 45th
Street, New
York, New York, one or more Series A Notes registered in its name, evidencing
the aggregate principal amount of Series A Notes to be purchased by
Prudential
and in the denomination or denominations specified with respect to Prudential
in
the Purchaser Schedule attached hereto, against payment of the purchase price
thereof by transfer of immediately available funds for credit to the
Company's
account #4735-000880 at Wachovia Bank of North Carolina, ABA Routing
Number #▇▇▇▇▇▇▇▇▇.
2B. Purchase and Sale of Shelf Notes.
2B(1) Facility. Prudential is willing to consider, in its sole
discretion and
within limits which may be authorized for purchase by Prudential and
Prudential
Affiliates from time to time, the purchase of Shelf Notes pursuant to this
Agreement. The willingness of Prudential to consider such purchase of Shelf
Notes is herein called the Facility. At any time, the aggregate principal
amount
of Shelf Notes stated in paragraph 1B, minus the aggregate principal amount
of
Shelf Notes purchased and sold pursuant to this Agreement prior to such time,
minus the aggregate principal amount of Accepted Notes (as hereinafter
defined)
which have not yet been purchased and sold hereunder prior to such time, plus
the
aggregate principal amount of Shelf Notes purchased and sold pursuant to this
Agreement and thereafter retired prior to such time is herein called the
Available
Facility Amount at such time. NOTWITHSTANDING THE WILLINGNESS OF
PRUDENTIAL TO CONSIDER PURCHASES OF SHELF NOTES, THIS
AGREEMENT IS ENTERED INTO ON THE EXPRESS UNDERSTANDING
THAT NEITHER PRUDENTIAL NOR ANY PRUDENTIAL AFFILIATE
SHALL BE OBLIGATED TO MAKE OR ACCEPT OFFERS TO PURCHASE
SHELF NOTES, OR TO QUOTE RATES, SPREADS OR OTHER TERMS
WITH RESPECT TO SPECIFIC PURCHASES OF SHELF NOTES, AND THE
FACILITY SHALL IN NO WAY BE CONSTRUED AS A COMMITMENT BY
PRUDENTIAL OR ANY PRUDENTIAL AFFILIATE.
2B(2). Issuance Period. Shelf Notes may be issued and sold pursuant
to
this Agreement until the earlier of:
(i) the third anniversary of the date of this Agreement (or if
any such
anniversary is not a Business Day, the Business Day next preceding such
anniversary),
(ii) the thirtieth day after Prudential shall have given to the
Company,
or the Company shall have given to Prudential, a notice stating that it
elects to terminate the issuance and sale of Shelf Notes pursuant to
this
Agreement (or if such thirtieth day is not a Business Day, the Business
Day
next preceding such thirtieth day),
(iii) The last Closing Day after which there is no Available
Facility
Amount,
(iv) The termination of the Facility under paragraph 7, and
(v) The acceleration of any Note under paragraph 7A of this
Agreement.
The period during which Shelf Notes may be issued and sold pursuant to this
Agreement is herein called the Issuance Period.
2B(3). Request for Purchase. The Company may from time to time during
the Issuance Period make requests for purchases of Shelf Notes (each such
request
being herein called a Request for Purchase). Each Request for Purchase
shall
be made to Prudential by telecopier or overnight delivery service, and shall:
(i) specify the aggregate principal amount of Shelf Notes
covered
thereby, which shall not be less than $5,000,000 and not be greater
than the
Available Facility Amount at the time such Request for Purchase is
made,
(ii) specify the principal amounts, final maturities (which
shall be no
more than ten years from the date of issuance), principal prepayment
dates
and amounts and interest payment periods (quarterly or semi-annual in
arrears) of the Shelf Notes covered thereby,
(iii) specify the use of proceeds of such Shelf Notes,
(iv) specify the proposed day for the closing of the purchase
and sale
of such Shelf Notes, which shall be a Business Day during the Issuance
Period not less than 10 days and not more than 25 days after the making
of such Request for Purchase (the Closing Day),
(v) specify the number of the account and the name and address
of the
depository institution to which the purchase prices of such Shelf Notes
are
to be transferred on the Closing Day for such purchase and sale,
(vi) certify that the representations and warranties contained
in
paragraph 8 are true on and as of the date of such Request for Purchase
and
that there exists on the date of such Request for Purchase no Event of
Default or Default,
(vii) specify the Designated Spread for such Shelf Notes, and
(viii) be substantially in the form of Exhibit B attached
hereto. Each
Request for Purchase shall be in writing and shall be deemed made when
received by Prudential.
2B(4). Rate Quotes. Not later than five Business Days after the
Company
shall have given Prudential a Request for Purchase pursuant to paragraph
2B(3),
Prudential may, but shall be under no obligation to, provide to the Company
by
telephone or telecopier, in each case between 9:30 A.M. and 1:30 P.M. New
York
City local time (or such later time as Prudential may elect) interest rate
quotes for
the several principal amounts, maturities, principal prepayment schedules,
and
interest payment periods of Shelf Notes specified in such Request for
Purchase.
Each quote shall represent the interest rate per annum payable on the
outstanding
principal balance of such Shelf Notes at which Prudential or a Prudential
Affiliate
would be willing to purchase such Shelf Notes at 100% of the principal amount
thereof.
2B(5). Acceptance. Within 30 minutes after Prudential shall have
provided
any interest rate quotes pursuant to paragraph 2B(4) or such shorter period
as
Prudential may specify to the Company (such period herein called the
Acceptance
Window), the Company may, subject to paragraph 2B(6), elect to accept such
interest rate quotes as to not less than $5,000,000 aggregate principal
amount of
the Shelf Notes specified in the related Request for Purchase. Such election
shall
be made by an Authorized Officer of the Company notifying Prudential by
telephone or telecopier within the Acceptance Window (but not earlier than
9:30 a.m. or later than 2:00 p.m., New York City local time) that the Company
elects to accept such interest rate quotes, specifying the Shelf Notes (each
such
Shelf Note being herein called an Accepted Note) as to which such
acceptance
(herein called a Acceptance) relates. The day the Company notifies
Prudential
of an Acceptance with respect to any Accepted Notes is herein called the
Acceptance Day" for such Accepted Notes. Any interest rate quotes as to
which
Prudential does not receive an Acceptance within the Acceptance Window shall
expire, and no purchase or sale of Shelf Notes hereunder shall be made based
on
such expired interest rate quotes. Subject to paragraph 2B(6) and the other
terms
and conditions hereof, the Company agrees to sell to Prudential or a
Prudential
Affiliate, and Prudential agrees to purchase, or to cause the purchase by a
Prudential Affiliate of, the Accepted Notes at 100% of the principal amount
of
such Notes. As soon as practicable following the Acceptance Day, the Company,
Prudential and each Prudential Affiliate which is to purchase any such
Accepted
Notes will execute a confirmation of such Acceptance substantially in the
form of
Exhibit C attached hereto (herein called a Confirmation of Acceptance). If
the
Company should fail to execute and return to Prudential within three Business
Days following receipt thereof a Confirmation of Acceptance with respect to
any
Accepted Notes, Prudential may at its election at any time prior to its
receipt
thereof cancel the closing with respect to such Accepted Notes by so
notifying the
Company in writing.
2B(6). Market Disruption. Notwithstanding the provisions of
paragraph
2B(5), if Prudential shall have provided interest rate quotes pursuant to
paragraph
2B(4) and thereafter prior to the time an Acceptance with respect to such
quotes
shall have been notified to Prudential in accordance with paragraph 2B(5) the
domestic market for U.S. Treasury securities or derivatives shall have closed
or
there shall have occurred a general suspension, material limitation, or
significant
disruption of trading in securities generally on the New York Stock Exchange
or
in the domestic market for U.S. Treasury securities or derivatives, then such
interest rate quotes shall expire, and no purchase or sale of Shelf Notes
hereunder
shall be made based on such expired interest rate quotes. If the Company
thereafter notifies Prudential of the Acceptance of any such interest rate
quotes,
such Acceptance shall be ineffective for all purposes of this Agreement, and
Prudential shall promptly notify the Company that the provisions of this
paragraph
2B(6) are applicable with respect to such Acceptance.
2B(7). Facility Closings. Not later than 11:30 A.M. (New York City
local
time) on the Closing Day for any Accepted Notes, the Company will deliver to
each Purchaser listed in the Confirmation of Acceptance relating thereto at
the
offices of the Prudential Capital Group, Four Gateway Center, ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, the Accepted Notes to be purchased by such
Purchaser in the form of one or more Notes in authorized denominations as
such
Purchaser may request for each Series of Accepted Notes to be purchased on the
Closing Day, dated the Closing Day and registered in such Purchaser's name
(or
in the name of its nominee), against payment of the purchase price thereof by
transfer of immediately available funds for credit to the Company's account
specified in the Request for Purchase of such Notes. If the Company fails to
tender to any Purchaser the Accepted Notes to be purchased by such Purchaser
on
the scheduled Closing Day for such Accepted Notes as provided above in this
paragraph 2B(7), or any of the conditions specified in paragraph 3 shall not
have
been fulfilled by the time required on such scheduled Closing Day, the
Company
shall, prior to 1:00 P.M., New York City local time, on such scheduled
Closing
Day notify Prudential (which notification shall be deemed received by each
Purchaser) in writing whether (i) such closing is to be rescheduled (such
rescheduled date to be a Business Day during the Issuance Period not less
than one
Business Day and not more than 10 Business Days after such scheduled Closing
Day (the Rescheduled Closing Day) and certify to Prudential (which
certification shall be for the benefit of each Purchaser) that the Company
reasonably believes that it will be able to comply with the conditions set
forth in
paragraph 3 on such Rescheduled Closing Day and that the Company will pay the
Delayed Delivery Fee in accordance with paragraph 2B(8)(iii) or (ii) such
closing
is to be canceled. In the event that the Company shall fail to give such
notice
referred to in the preceding sentence, Prudential (on behalf of each
Purchaser) may
at its election, at any time after 1:00 P.M., New York City local time, on
such
scheduled Closing Day, notify the Company in writing that such closing is to
be
canceled. Notwithstanding anything to the contrary appearing in this
Agreement,
the Company may elect to reschedule a closing with respect to any given
Accepted
Notes on not more than one occasion, unless Prudential shall have otherwise
consented in writing.
2B(8) . Fees.
2B(8)(i). Facility Fee. In consideration for the time, effort and
expense
involved in the preparation, negotiation and execution of this Agreement, at
the
time of the execution and delivery of this Agreement by the Company and
Prudential, the Company will pay to Prudential in immediately available funds
a
fee (herein called the Facility Fee) in the amount of $25,000.
2B(8)(ii) Issuance Fee. The Company will pay to Prudential in
immediately available funds a fee (herein called the Issuance Fee) on each
Closing Day (other than the Series A Closing Day) in an amount equal to 1/8
of
1% of the aggregate principal amount of Notes sold on such Closing Day
2B(8)(iii) Delayed Delivery Fee. If the closing of the purchase and
sale of
any Accepted Note is delayed for any reason beyond the original Closing Day
for
such Accepted Note, the Company will pay to Prudential (a) on the
Cancellation
Date or actual closing date of such purchase and sale and (b) if earlier, the
next
Business Day following 90 days after the Acceptance Day for such Accepted
Note
and on each Business Day following 90 days after the prior payment hereunder,
a fee (herein called the Delayed Delivery Fee) calculated as follows:
(BEY - MMY) X DTS/360 X PA
where BEY means Bond Equivalent Yield, i.e., the bond equivalent yield per
annum of such Accepted Note, MMY means Money Market Yield, i.e., the
yield per annum on a commercial paper investment of the highest quality
selected
by Prudential on the date Prudential receives notice of the delay in the
closing for
such Accepted Note having a maturity date or dates the same as, or closest
to, the
Rescheduled Closing Day or Rescheduled Closing Days (a new alternative
investment being selected by Prudential each time such closing is delayed);
DTS means Days to Settlement, i.e., the number of actual days elapsed from
and including the original Closing Day with respect to such Accepted Note (in
the
case of the first such payment with respect to such Accepted Note) or from
and
including the date of the next preceding payment (in the case of any
subsequent
delayed delivery fee payment with respect to such Accepted Note) to but
excluding
the date of such payment; and PA means Principal Amount, i.e., the
principal
amount of the Accepted Note for which such calculation is being made. In no
case shall the Delayed Delivery Fee be less than zero. Nothing contained
herein
shall obligate any Purchaser to purchase any Accepted Note on any day other
than
the Closing Day for such Accepted Note, as the same may be rescheduled from
time to time in compliance with paragraph 2B(7).
2B(8)(iv). Cancellation Fee. If the Company at any time notifies
Prudential in writing that the Company is canceling the closing of the
purchase and
sale of any Accepted Note, or if Prudential notifies the Company in writing
under
the circumstances set forth in the last sentence of paragraph 2B(5) or the
penultimate sentence of paragraph 2B(7) that the closing of the purchase and
sale
of such Accepted Note is to be canceled, or if the closing of the purchase
and sale
of such Accepted Note is not consummated on or prior to the last day of the
Issuance Period (the date of any such notification, or the last day of the
Issuance
Period, as the case may be, being herein called the Cancellation Date), the
Company will pay the Purchasers in immediately available funds an amount (the
Cancellation Fee) calculated as follows:
PI X PA
where PI means Price Increase, i.e., the quotient (expressed in decimals)
obtained by dividing (a) the excess of the ask price (as determined by
Prudential)
of the Hedge Treasury Note(s) on the Cancellation Date over the bid price (as
determined by Prudential) of the Hedge Treasury Notes(s) on the Acceptance
Day
for such Accepted Note by (b) such bid price; and PA has the meaning
ascribed
to it in paragraph 2B(8)(iii). The foregoing bid and ask prices shall be as
reported
by Telerate Systems, Inc. (or, if such data for any reason ceases to be
available
through Telerate Systems, Inc., any publicly available source of similar
market
data). Each price shall be based on a U.S. Treasury security having a par
value
of $100.00 and shall be rounded to the second decimal place. In no case
shall the
Cancellation Fee be less than zero.
3. CONDITIONS OF CLOSING. The obligation of any Purchaser to
purchase and pay for any Notes is subject to the satisfaction, on or before
the
Closing Day for such Notes, of the following conditions:
3A. Certain Documents. Such Purchaser shall have received the
following,
each dated the date of the applicable Closing Day:
(i) The Note(s) to be purchased by such Purchaser.
(ii) Certified copies of the resolutions of the Board of
Directors of the
Company authorizing the execution and delivery of this Agreement and
the
issuance of the Notes, and of all documents evidencing other necessary
corporate action and governmental approvals, if any, with respect to
this
Agreement and the Notes.
(iii) A certificate of the Secretary or an Assistant Secretary
and one
other officer of the Company certifying the names and true signatures
of
the officers of the Company authorized to sign this Agreement and the
Notes and the other documents to be delivered hereunder.
(iv) Certified copies of the Certificate of Incorporation and
By-laws of
the Company.
(v) A favorable opinion of ▇▇▇▇▇▇▇ ▇▇▇▇▇ Battle & ▇▇▇▇▇▇,
L.L.P.,
special counsel to the Company (or such other counsel designated by the
Company and acceptable to the Purchaser(s)) satisfactory to such
Purchaser
and substantially in the form of Exhibit D-1 (in the case of the Series
A
Notes) or D-2 (in the case of any Shelf Notes) attached hereto and as
to
such other matters as such Purchaser may reasonably request. The
Company hereby directs each such counsel to deliver such opinion,
agrees
that the issuance and sale of any Notes will constitute a
reconfirmation of
such direction, and understands and agrees that each Purchaser
receiving
such an opinion will and is hereby authorized to rely on such opinion.
(vi) A good standing certificate for the Company from the
Secretary of
State of Delaware dated of a recent date and good standing or other
certificates of qualification to do business as a foreign corporation
for the
Company in the State of Virginia and North Carolina and Texas and such
other evidence of the status of the Company as such Purchaser may
reasonably request.
(vii) Additional documents or certificates with respect to
legal matters
or corporate or other proceedings related to the transactions
contemplated
hereby as may be reasonably requested by such Purchaser.
3B. Opinion of Purchaser's Special Counsel. Such Purchaser shall
have
received from King & Spalding, in connection with the Series A Closing Day
and,
with respect to any other Closing Day, its in-house counsel, a favorable
opinion
satisfactory to such Purchaser as to such matters incident to the matters
herein
contemplated as it may reasonably request.
3C. Representations and Warranties; No Default. The representations
and
warranties contained in paragraph 8 shall be true in all material respects on
and as
of such Closing Day, except to the extent of changes caused by the
transactions
herein contemplated; there shall exist on such Closing Day no Event of
Default or
Default; and the Company shall have delivered to such Purchaser an Officer's
Certificate, dated such Closing Day, to both such effects.
3D. Purchase Permitted by Applicable Laws. The purchase of and
payment
for the Notes to be purchased by such Purchaser on the terms and conditions
herein
provided (including the use of the proceeds of such Notes by the Company)
shall
not violate any applicable law or governmental regulation (including, without
limitation, Section 5 of the Securities Act or Regulation G, T or X of the
Board
of Governors of the Federal Reserve System) and shall not subject such
Purchaser
to any tax, penalty, liability or other onerous condition under or pursuant
to any
applicable law or governmental regulation, and such Purchaser shall have
received
such certificates or other evidence as it may reasonably request to establish
compliance with this condition.
3E. Payment of Fees. The Company shall have paid to Prudential any
fees
due it pursuant to or in connection with this Agreement, including any
Facility Fee
due pursuant to paragraph 2B(8)(i), any Issuance Fee due pursuant to
paragraph
2B(8)(ii) and any Delayed Delivery Fee due pursuant to paragraph 2B(8)(iii).
3F. No Material Adverse Change. Prudential shall have received a
certificate from the chief financial officer of the Company, dated the
applicable
Closing Day, saying that no material adverse change in the financial
condition,
business, operations or prospects of the Company or its subsidiaries, taken
as a
whole, has occurred since December 31, 1994.
4. PREPAYMENTS. The Series A Notes and any Shelf Notes shall be
subject to required prepayment as and to the extent provided in paragraphs 4A
and
4B, respectively. The Series A Notes and any Shelf Notes shall also be
subject
to prepayment under the circumstances set forth in paragraph 4C. Any
prepayment
made by the Company pursuant to any other provision of this paragraph 4 shall
not
reduce or otherwise affect its obligation to make any required prepayment as
specified in paragraph 4A or 4B.
4A. Required Prepayments of Series A Notes. Until the Series A
Notes
shall be paid in full, the Company shall apply to the prepayment of the
Series A
Notes, without Yield-Maintenance Amount, the amount set forth below on the
date
set forth opposite such amount:
$650,000 June 29, 1996
$725,000 June 29, 1997
$800,000 June 29, 1998
$850,000 June 29, 1999
$950,000 June 29, 2000
$1,000,000 June 29, 2001
$1,125,000 June 29, 2002
$1,200,000 June 29, 2003
$1,300,000 June 29, 2004
and such principal amounts of the Series A Notes, together with interest
thereon to the payment dates, shall become due on such payment dates. The
remaining unpaid principal amount of the Series A Notes, together with
interest accrued thereon, shall become due on June 29, 2005, the maturity
date of the Series A Notes.
4B. Required Prepayments of Shelf Notes. Each Series of Shelf Notes
shall
be subject to required prepayments, if any, set forth in the Notes of such
Series.
4C. Optional Prepayment With Yield-Maintenance Amount. The Notes of
each Series shall be subject to prepayment, in whole at any time or from time
to
time in part (in integral multiples of $100,000 and in a minimum amount of
$1,000,000), at the option of the Company, at 100% of the principal amount so
prepaid plus interest thereon to the prepayment date and the
Yield-Maintenance
Amount, if any, with respect to each such Note. Any partial prepayment of a
Series of the Notes pursuant to this paragraph 4C shall be applied in
satisfaction
of required payments of principal in inverse order of their scheduled due
dates.
4D. Notice of Optional Prepayment. The Company shall give the
holder
of each Note of a Series to be prepaid pursuant to paragraph 4C irrevocable
written
notice of such prepayment not less than 5 Business Days prior to the
prepayment
date, specifying such prepayment date, the aggregate principal amount of the
Notes
of such Series to be prepaid on such date, the principal amount of the Notes
of
such Series held by such holder to be prepaid on that date and that such
prepayment is to be made pursuant to paragraph 4C. Notice of prepayment
having
been given as aforesaid, the principal amount of the Notes specified in such
notice,
together with interest thereon to the prepayment date and together with the
Yield-
Maintenance Amount, if any, herein provided, shall become due and payable on
such prepayment date. The Company shall use reasonable efforts, on or before
the
day on which it gives written notice of any prepayment pursuant to paragraph
4C,
to give telephonic notice of the principal amount of the Notes to be prepaid
and
the prepayment date to each Significant Holder which shall have designated a
recipient for such notices in the Purchaser Schedule attached hereto or the
applicable Confirmation of Acceptance or by notice in writing to the Company.
4E. Application of Required Prepayments. In the case of each
prepayment
of less than the entire unpaid principal amount of all outstanding Notes of
any
Series pursuant to paragraphs 4A, 4B or 4C, the amount to be prepaid shall be
applied pro rata to all outstanding Notes of such Series (including, for the
purpose
of this paragraph 4E only, all Notes prepaid or otherwise retired or
purchased or
otherwise acquired by the Company or any of its Subsidiaries or Affiliates
other
than by prepayment pursuant to paragraph 4A, 4B or 4C) according to the
respective unpaid principal amounts thereof.
4F. Retirement of Notes. The Company shall not, and shall not
permit any
of its Subsidiaries or Affiliates to, prepay or otherwise retire in whole or
in part
prior to their stated final maturity (other than by prepayment pursuant to
paragraphs 4A or 4B or upon acceleration of such final maturity pursuant to
paragraph 7A), or purchase or otherwise acquire, directly or indirectly,
Notes of
any Series held by any holder unless the Company or such Subsidiary or
Affiliate
shall have offered to prepay or otherwise retire or purchase or otherwise
acquire,
as the case may be, the same proportion of the aggregate principal amount of
Notes of such Series held by each other holder of Notes of such Series at the
time
outstanding upon the same terms and conditions. Any Notes so prepaid or
otherwise retired or purchased or otherwise acquired by the Company or any of
its
Subsidiaries or Affiliates shall not be deemed to be outstanding for any
purpose
under this Agreement, except as provided in paragraph 4E.
5. AFFIRMATIVE COVENANTS.
5A. Reporting Requirements.
5A(1) General Information. The Company covenants that it will
deliver
to each Significant Holder in triplicate:
(i) as soon as practicable and in any event within 45 days
after the end
of each quarterly period (other than the fourth quarterly period) in
each
fiscal year,
(1) Consolidated statements of income, stockholders'
equity and
cash flows for the period from the beginning of the current
fiscal
year to the end of such quarterly period, and
(2) a Consolidated balance sheet as at the end of such
quarterly
period,
setting forth in each case in comparative form figures for the
corresponding
period in the preceding fiscal year, all in reasonable detail and
satisfactory
in form to the Required Holder(s) and certified by an authorized
financial
officer of the Company as fairly presenting, in all material respects,
the
financial condition of the Company and its Consolidated Subsidiaries as
of
the end of such period and the results of their operations for the
period then
ended in accordance with generally accepted accounting principles,
subject
to changes resulting from normal year-end adjustments and the inclusion
of abbreviated footnotes; provided, however, that delivery pursuant to
clause (iii) below of copies of the Quarterly Report on Form 10-Q of
the
Company for such quarterly period filed with the Securities and
Exchange
Commission shall be deemed to satisfy the requirements of this clause
(i);
(ii) as soon as practicable and in any event within 90 days
after the end
of each fiscal year,
(1) Consolidated statements of income, stockholders'
equity and
cash flows for such year, and
(2) a Consolidated balance sheet as at the end of such
year,
setting forth in each case in comparative form corresponding
Consolidated
figures from the preceding annual audit, all in reasonable detail and
satisfactory in scope to the Required Holder(s) and reported on by
independent public accountants of recognized standing selected by the
Company whose report shall be without limitation as to the scope of the
audit and reasonably satisfactory in substance to the Required
Holder(s);
provided, however, that delivery pursuant to clause (iii) below of
copies of
the Annual Report on Form 10-K of the Company for such year filed with
the Securities and Exchange Commission shall be deemed to satisfy the
requirements of this clause (ii);
(iii) promptly upon transmission thereof, copies of all such
financial
statements, proxy statements, notices and reports as it shall send to
its
public stockholders and copies of all registration statements (without
exhibits) and all reports (other than any registration statement filed
on
Form S-8) which it files with the Securities and Exchange Commission
(or
any governmental body or agency succeeding to the functions of the
Securities and Exchange Commission);
(iv) promptly upon receipt thereof, a copy of each other report
(including, without limitation, management letters) submitted to the
Company or any Subsidiary by independent accountants in connection with
any annual, interim or special audit made by them of the books of the
Company or any Subsidiary;
(v) promptly upon receipt thereof, a copy of each report,
survey, study,
evaluation, assessment or other document prepared by any consultant,
engineer, Environmental Authority or other Person relating to
compliance
by the Company or any Subsidiary with any Environmental Requirements,
if the cost of remediation, repair or compliance may be reasonably
expected
to exceed $500,000 in any one case or in the aggregate;
(vi) with reasonable promptness, upon the request of the holder
of any
Note, provide such holder, and any qualified institutional buyer
designated
by such holder, such financial and other information as such holder may
reasonably determine to be necessary in order to permit compliance with
the information requirements of Rule 144A under the Securities Act in
connection with the resale of Notes, except at such times as the
Company
is subject to the reporting requirements of section 13 or 15(d) of the
Exchange Act. For the purpose of this clause (vii), the term
qualified
institutional buyer shall have the meaning specified in Rule 144A
under
the Securities Act; and
(vii) with reasonable promptness, such other financial data as
a
Significant Holder may reasonably request;
5A(2) Quarterly Officer's Certificates. Together with each delivery
of
financial statements required by clauses 5A(i) and (ii) above, the Company
will
deliver to each Significant Holder an Officer's Certificate demonstrating
(with
computations in reasonable detail) compliance with the provisions of
paragraphs 6A, 6B and 6D and stating that there exists no Event of Default or
Default, or, if any Event of Default or Default exists, specifying the nature
and
period of existence thereof and what action the Company has taken, is taking
or
proposes to take with respect thereto;
5A(3) Annual Accountant's Letter. Together with each delivery of
financial
statements required by clause 5A(ii) above, the Company will deliver to each
Significant Holder a certificate of the independent public accountants giving
the
report on such financial statements stating that, in making the audit
necessary for
their report, they have obtained no knowledge of any Event of Default or
Default,
or, if they have obtained knowledge of any Event of Default or Default,
specifying
the nature and period of existence thereof. The accountants, however, shall
not be
liable to anyone as a result of this provision by reason of their failure to
obtain
knowledge of any Event of Default or Default which would not be disclosed in
the
course of an audit conducted in accordance with generally accepted auditing
standards;
5A(4) Special Information. The Company also covenants that within
5 Business Days after any Responsible Officer obtains knowledge of:
(a) an Event of Default or Default;
(b) a material adverse change in the financial condition,
business or
operations of the Company and its Subsidiaries, taken as a whole;
(c) legal proceedings filed against the Company and/or any
Subsidiary,
which reasonably could be expected to have a material adverse effect on
the financial condition, business or operations of the Company and its
Subsidiaries, taken as a whole, or which in any manner draws into
question
the validity of or reasonably could be expected to impair the ability
of the
Company to perform its obligations under this Agreement or the Notes;
(d) a default under any agreement or note evidencing Debt for
which
the Company or any Subsidiary is liable, which individually or in the
aggregate with all other agreements and notes in default for which the
Company or any Subsidiary is liable, exceed $2,000,000;
(e) the occurrence of any other event that reasonably could be
expected
to impair the ability of the Company to meet its obligations hereunder;
(f) any (i) Environmental Liabilities, (ii) pending, threatened
or
anticipated Environmental Proceedings, (iii) Environmental Notices,
(iv) Environmental Judgments and Orders, or (v) Environmental Releases
at, on, in, under or in any way affecting the Properties which
reasonably
could be expected to have a material adverse effect on the business,
operations or financial condition of the Company and its Subsidiaries,
taken
as a whole; or
(g) with respect to any Plan that is subject to the funding
requirements
of Section 302 of ERISA or Section 412 of the Code, the Company (i) has
given or is required to give notice to the Pension Benefit Guaranty
Corporation that a material reportable event has occurred with respect
to
such Plan, (ii) has delivered notice to the Pension Benefit Guaranty
Corporation of any intent to withdraw from or terminate any such Plan,
or
(iii) has failed to make timely a contribution to any such Plan;
the Company will deliver to each Significant Holder an Officer's Certificate
specifying the nature and period of existence thereof and what action the
Company
or the Subsidiary has taken, is taking or proposes to take with respect
thereto.
5B. Inspection of Property. The Company covenants that, at such
reasonable times and as often as a Significant Holder may reasonably request,
it
will permit any Person designated by a Significant Holder in writing, at such
Significant Holder's expense unless a Default has occurred and is continuing
in
which case at the Company's expense, to:
(i) visit and inspect any of the properties of the Company and
any
Subsidiary;
(ii) examine the corporate books and financial records of the
Company
and its Subsidiaries and make copies thereof or extracts therefrom; and
(iii) discuss the affairs, finances and accounts of any of such
corporations with the principal officers of the Company or any
Subsidiary
and independent public accountants to the Company.
5C. Covenant to Secure Notes Equally. The Company covenants that if
it
or any Subsidiary shall create or assume any Lien upon any of its property or
assets, whether now owned or hereafter acquired, other than Liens permitted
by
paragraph 6C(1) (unless prior written consent shall have been obtained under
paragraph 11C), it will make or cause to be made effective provision whereby
the
Notes will be secured by such Lien equally and ratably with any and all other
Debt
thereby secured so long as any such other Debt shall be so secured.
5D. Guaranteed Obligations. The Company covenants that if any
Person
(other than the Company) guarantees or provides collateral in any manner for
any
Debt of the Company or any Subsidiary, it will simultaneously cause such
Person
to guarantee or provide collateral for the Notes equally and ratably with all
Debt
guaranteed or secured by such Person pursuant to documentation in form and
substance reasonably satisfactory to such holder.
5E. Maintenance of Insurance. The Company covenants that it and
each
Subsidiary will maintain, with responsible insurers, insurance with respect
to its
properties and business against such casualties and contingencies (including,
but
not limited to, public liability, larceny, embezzlement or other criminal
misappropriation) and in such amounts as is customary in the case of
similarly
situated corporations engaged in the same or similar businesses.
5F. Maintenance of Corporate Existence/Compliance with
Law/Preservation
of Property. The Company covenants that, except as permitted under paragraph
6C(3) and 6D, it and each Subsidiary will do or cause to be done all things
necessary to:
(i) preserve, renew and keep in full force and effect the
corporate
existence of the Company and its Subsidiaries (other than those
Subsidiaries not material to the financial condition, business or
operations
of the Company and its Subsidiaries taken as a whole);
(ii) comply with all laws and regulations (including, without
limitation,
laws and regulations relating to equal employment opportunity and
employee safety) applicable to it and any Subsidiary except where the
failure to comply could not reasonably be expected to have a material
adverse effect on the business, operations or financial condition of
the
Company and its Subsidiaries, taken as a whole;
(iii) maintain, preserve and protect all material intellectual
property of
the Company and its Subsidiaries; and
(iv) preserve all the remainder of its property used or useful
in the
conduct of its business and keep the same in good repair, working order
and condition excluding normal wear and tear.
5G. Compliance with Environmental Laws. The Company covenants that
it and each Subsidiary will, comply in a timely fashion with, or operate
pursuant
to valid waivers of the provisions of, all applicable Environmental
Requirements,
including, without limitation, the emission of wastewater effluent, solid and
hazardous waste and air emissions together with any other applicable
Environmental Requirements for conducting, on a timely basis, periodic tests
and
monitoring for contamination of ground water, surface water, air and land and
for
biological toxicity of the aforesaid, and all applicable regulations of the
Environmental Protection Agency or other relevant federal, state or local
governmental authority, except where the failure to comply could not
reasonably
be expected to have a material adverse effect on the business, operations or
financial condition of the Company and its Subsidiaries, taken as a whole.
The
Company agrees to indemnify and hold you, your officers, agents and employees
(each an Indemnified Person) harmless from any loss, liability, claim or
expense
that you may incur or suffer as a result of a breach by the Company or any
Subsidiary, as the case may be, of this covenant other than as a result of
the gross
negligence or wilful misconduct of such Indemnified Person. The Company
shall
not be deemed to have breached or violated this paragraph 5G if the Company
or
any Subsidiary is challenging in good faith by appropriate proceedings
diligently
pursued the application or enforcement of such Environmental Requirements for
which adequate reserves have been established in accordance with generally
accepted accounting principles.
5H. No Integration. The Company covenants that it has taken and
will take
all necessary action so that the issuance of the Notes does not and will not
require
registration under the Securities Act. The Company covenants that no future
offer
and sale of debt securities of the Company of any class will be made if there
is a
reasonable possibility that such offer and sale would, under the doctrine of
integration, subject the issuance of the Notes to you to the registration
requirements of the Securities Act.
5I. Financial Records. The Company covenants that it and each
Subsidiary
will, keep proper books of record and account in which full and correct
entries
(subject to normal year end adjustments and, as to interim statements, the
absence
of footnotes) will be made of the business and affairs of the Company or such
Subsidiary under generally accepted accounting principles consistently
applied
(except for changes disclosed in the financial statements furnished to you
pursuant
to paragraph 5A and concurred in by the independent public accountants
referred
to in paragraph 5A).
6. NEGATIVE COVENANTS. Unless the Required Holders otherwise
agree in writing, the Company shall not, and shall not permit any Subsidiary,
to
take any of the following actions or permit the occurrence or existence of
any of
the following events or conditions:
6A. Fixed Charge Coverage and Debt Limits. The Company covenants
that
it will not at any time permit:
(i) Consolidated Operating Income to be less than [200%] of
Consolidated Fixed Charges; or
(ii) Consolidated Debt to exceed 55% of Consolidated
Capitalization;
or
(iii) Consolidated Priority Debt to exceed 10% of Consolidated
Net
Worth.
6B. Dividend Limitation. The Company covenants that, except as
otherwise permitted by the following sentence, it will not:
(i) pay or declare any dividend on any class of its stock or
make any
other distribution on account of any class of its stock; or
(ii) redeem, purchase or otherwise acquire, directly or
indirectly, any
shares of its stock (all of the foregoing being herein called
Restricted
Payments); or
except out of Cumulative Amounts Available For Restricted Payments and so
long
as
(1) at the time of declaration of such Restricted Payment, no
Default
or Event of Default exists or would exist; and
(2) the Restricted Payment is made within 60 days after the
declaration
thereof.
The calculation of Restricted Payments and Cumulative Amounts Available
For Restricted Payments shall exclude: (x) stock splits, dividends paid, or
distributions made, in stock of the Company; or (y) exchanges of stock of one
or
more classes of the Company, except to the extent cash or other value is
involved
in such exchange. The term stock as used in this paragraph 6B shall
include
warrants or options to purchase stock.
6C. Liens, Debt and Other Restrictions. The Company covenants that
it
will not and will not permit any Subsidiary to:
6C(1) Liens. Create, assume or suffer to exist any Lien upon any of
its
property or assets, whether now owned or hereafter acquired (whether or not
provision is made for the equal and ratable securing of the Notes pursuant to
paragraph 5C), except:
(i) Liens for taxes (including ad valorem and property taxes)
and
assessments or governmental charges or levies not yet due or which are
being actively contested in good faith by appropriate proceedings;
(ii) other Liens incidental to the conduct of its business or
the
maintenance, operation, construction or ownership of its property and
assets
(including pledges or deposits in connection with workers' compensation
and social security taxes, assessments and charges, and landlords,
mechanics and materialmen Liens and survey exceptions or encumbrances,
easements or reservations, rights-of-way, or zoning restrictions)
provided
that (A) such Liens were not incurred in connection with the borrowing
of
money, or the obtaining of advances or credit or the payment of the
deferred purchase price of property and (B) the existence of such Lien
does
not materially detract from the value of such property or assets to
the
Company or any Subsidiary or unreasonably interfere with the ordinary
conduct of business;
(iii) Liens (other than any Lien imposed by ERISA) incurred or
deposits made in the ordinary course of business to secure (or to
obtain
letters of credit that secure) the performance of tenders, statutory
obligations, surety and appeal bonds, bids, leases, performance bonds,
purchase, construction or sales contracts and other similar
obligations, in
each case not incurred or made in connection with Debt;
(iv) to the extent permitted under paragraphs 6A and 6C(2), any
Lien
created to secure all or any part of the purchase price incurred or
assumed
to pay all or any part of the purchase price of property acquired by
the
Company or a Subsidiary after the date of this Agreement, provided
that:
(A) any such Lien shall be confined 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 for specific use with such acquired property;
(B) the principal amount of the Debt secured by any such
Lien
shall at no time exceed 100% of the lesser of (1) the cost to the
Company or the Subsidiary of the property acquired and (2) the
Fair
Market Value of such property (as determined in good faith by the
Company's Board) at the time of such acquisition; and
(C) any such Lien shall be created within 365 days after
the
acquisition of the property or completion of the improvements;
(v) Liens securing Capitalized Lease Obligations, provided such
Liens
are limited to the property subject to such leases;
(vi) other Liens securing Priority Debt permitted under
paragraphs 6A
and 6C(2); and
(vii) any right of set off or banker's lien (whether by common
law,
statute, contract or otherwise) in favor of any Person to whom neither
the
Company nor Subsidiary owes any Debt; or
6C(2) Debt. Create, incur, assume or suffer to exist any Debt,
except:
(i) Debt of any Subsidiary to the Company or any Wholly-Owned
Subsidiary;
(ii) other Debt of Subsidiaries permitted under paragraph 6A;
and
(iii) other Debt of the Company (other than Debt owed to a
Subsidiary)
permitted under paragraph 6A;
6C(3) Merger or Consolidation. Merge, consolidate or exchange
shares
with any other Person, except that:
(i) any Subsidiary may merge or consolidate with the Company or
any
Wholly-Owned Subsidiary; provided, in the case of a Wholly-Owned
Subsidiary, it remains a Wholly-Owned Subsidiary after the merger or
consolidation;
(ii) the Company may merge or consolidate with any other
corporation
(including a Subsidiary) if the continuing or surviving corporation is
the
Company and immediately after such merger or consolidation, no Default
or Event of Default shall have occurred or exist; or
6C(4) Sale or Discount of Receivables. Sell with recourse, or
discount or
otherwise sell for less than the face value thereof, any of its notes or
accounts
receivable; or
6C(5) Change in Business. Enter into any business which is
substantially
different from the manufacturing of home furnishings; or
6C(6) Transactions with Related Party. Effect any transaction with
any
Affiliate or Subsidiary by which any asset or services of the Company or a
Subsidiary of the Company is transferred to such Affiliate or Subsidiary, or
from
such Affiliate or Subsidiary or enter into any other transaction with an
Affiliate or
Subsidiary, on terms more favorable than would be reasonably expected to be
given in a similar transaction with an unrelated entity other than the ▇▇▇
Management Agreement.
6C(7) Investments. Make, or permit to remain, an Investment except:
(i) any Investment in a Subsidiary or an entity that becomes a
Subsidiary simultaneously with such Investment,
(ii) any evidence of debt, maturing not more than one year
after the
date of issue, issued by the United States of America, or any
instrumentality or agency thereof and guaranteed fully as to principal,
interest and premium, if any, by the United States of America,
(iii) any repurchase agreement or certificate of deposit,
maturing not
more than one year after the date of purchase, issued by the National
Bank
of Canada or a commercial bank, bank holding company or trust company
which is located within the United States of America, organized under
the
laws of the United States of America or the laws of any State thereof,
is
a member of the Federal Reserve System, has a ▇▇▇▇▇▇▇▇ Bank Watch
Rating (or if no longer available, a comparable rating system), at the
time
of determination, of B (or higher), and has a combined capital and
surplus and undivided profits of at least $500,000,000,
(iv) commercial paper, maturing not more than 270 days after
the date
of purchase, issued by a corporation (other than the Company or any
Subsidiary or Affiliate) organized and existing under the laws of any
state
within the United States of America with a rating, at the time as of
which
any determination thereof is to be made, of P-1 (or higher) according
to
▇▇▇▇▇'▇ Investors Service (or if no longer available, a comparable
rating
system), or A-1 (or higher) according to Standard & Poor's
Corporation
(or if no longer available, a comparable rating system),
(v) property or assets acquired solely in exchange for capital
stock of
the Company, and
(vi) any other Investment of the Company or any of its
Subsidiaries so
long as the amount of all such Investments, other than investments
specified in clauses (i) through (v) above shall not exceed an amount
equal
to 10% of Consolidated Net Worth.
6D. Sale of Property. The Company will not, and will not permit any
Subsidiary to, Dispose of any property or assets, except:
(i) The Company or any Subsidiary may sell inventory in the
ordinary
course of business for Fair Market Value;
(ii) any Subsidiary may Dispose of its assets to the Company or
a
Wholly-Owned Subsidiary;
(iii) the Company or any Subsidiary may Dispose of its assets
(whether
or not leased back) so long as, immediately after giving effect to such
proposed Disposition:
(A) the consideration for such assets represents the Fair
Market
Value of such assets (as determined in good faith by the
Company's
Board) at the time of such Disposition; and
(B) the net book value of all assets so Disposed of by the
Company and its Subsidiaries during the prior 12 months, does not
exceed 15% of Consolidated Assets; and
(C) the amount of Consolidated Operating Income produced
by all
assets so Disposed of by the Company and its Subsidiaries during
the prior 12 months, does not exceed 15% of Consolidated
Operating Income at the end of the most recently completed 12
months; and
(D) no Default or Event of Default shall exist;
provided, however, if after any Disposition, the net book value of all
assets
Disposed of during the prior 12 months exceeds 15% of Consolidated
Assets or the Consolidated Operating Income produced by all assets
Disposed of during the prior 12 months exceeds 15% of Consolidated
Operating Income, the Company shall, within 12 months of the date of
such Disposition, apply the proceeds (net of reasonable expenses) from
such Disposition (or such portion thereof as is necessary to cause
compliance with the provisions of this paragraph 6D(iii)) to acquire
operating assets and equipment to be used in the furniture
manufacturing
business of the Company and its Wholly-Owned Subsidiaries.
For purposes of this paragraph 6D:
(i) Disposition means the sale, lease, transfer or other
disposition of
property, and Disposed of has a corresponding meaning to Disposition;
(ii) Calculation of net book value/Consolidated Operating
Income. The
net book value of any assets shall be determined as of the respective
date
of Disposition of those assets and the Consolidated Operating Income
produced by any assets shall be determined using Consolidated Operating
Income for the 12 month period before the respective date of
Disposition
of those assets; and
(iii) Sales of less than all the stock of a Subsidiary. In the
case of the
sale or issuance of the stock of a Subsidiary, the amount of
Consolidated
Operating Income, or amount of Consolidated Assets, as the case may be,
contributed by the stock Disposed of shall be assumed to be the
percentage
of outstanding stock sold or to be sold.
6E. Subsidiary Stock and Debt. The Company will not:
(i) directly or indirectly sell, assign, pledge or otherwise
dispose of any
Debt of or any shares of stock of (or warrants, rights or options to
acquire
stock of) any Subsidiary except to a Wholly-Owned Subsidiary and except
as permitted pursuant to paragraph 6D;
(ii) permit any Subsidiary directly or indirectly to sell,
assign, pledge
or otherwise dispose of any Debt of the Company or any other
Subsidiary,
or any shares of stock of (or warrants, rights or options to acquire
stock of)
any other Subsidiary, except to the Company or a Wholly-Owned
Subsidiary and except pursuant to paragraph 6D;
(iii) permit any Subsidiary to have outstanding any shares of
Preferred
Stock other than Preferred Stock owned by the Company or a Wholly-
Owned Subsidiary;
(iv) permit any Subsidiary directly or indirectly to issue or
sell any
shares of its stock (or warrants, rights or options to acquire its
stock) except
to the Company or a Wholly-Owned Subsidiary and except as permitted
pursuant to paragraph 6C(3) and 6D; or
(v) permit any Subsidiary to enter into or otherwise be bound
by or
subject to any contract or agreement (including, without limitation,
any
provision of its certificate or articles of incorporation or bylaws)
that
restricts its ability to pay dividends or other distributions on
account of its
stock; or
(vi) permit any Subsidiary to create, incur, assume or maintain
any
Debt except as permitted by paragraphs 6A and 6C(2).
6F. ERISA. The Company covenants that it will not nor permit any
Subsidiary to:
(i) terminate or withdraw from any Plan resulting in the
incurrence of
any material liability to the Pension Benefit Guaranty Corporation;
(ii) engage in or permit any Person to engage in any prohibited
transaction (as defined in Section 4975 of the Code) involving any Plan
(other than a Multiemployer Plan) which would subject the Company or
any Subsidiary to any material tax, penalty or other liability;
(iii) incur or suffer to exist any material accumulated funding
deficiency (as defined in section 302 of ERISA and section 412 of the
Code), whether or not waived, involving any Plan (other than a
Multiemployer Plan); or
(iv) allow or suffer to exist any risk or condition which
presents a risk
of incurring a material liability to the Pension Benefit Guaranty
Corporation.
6G. Environmental Matters. The Company covenants that it will not,
and
will not permit any Third Party to, use, produce, manufacture, process,
generate,
store, dispose of, manage at, or ship or transport to or from the Properties
any
Hazardous Materials except for Hazardous Materials used, produced, released
or
managed in the ordinary course of business in compliance with all applicable
Environmental Requirements except where the failure to do so could not
reasonably be expected to have a material adverse effect on the business,
operations or financial condition of the Company and its Subsidiaries taken
as a
whole and except for Hazardous Materials released in amounts which do not
require remediation pursuant to applicable Environmental Requirements or if
remediation is required, such remediation could not reasonably be expected to
have
a material adverse effect on the business, operations or financial condition
of the
Company and its Subsidiaries taken as a whole.
6H. Specified Laws. Neither the Company nor any agent acting on its
behalf will take any action which could reasonably be expected to cause this
Agreement or the Notes to violate Regulation G, Regulation T or any other
regulation of the Board of Governors of the Federal Reserve System or to
violate
the Exchange Act, in any case as in effect now or as the same may hereafter
be
in effect.
7. EVENTS OF DEFAULT.
7A. Acceleration. If any of the following events shall occur and be
continuing for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law or
otherwise):
(i) the Company defaults in the payment of any principal of or
Yield-
Maintenance Amount payable with respect to any Note when the same
shall become due, either by the terms thereof or otherwise as herein
provided; or
(ii) the Company defaults in the payment of any interest on any
Note
for more than 5 calendar days after the date due; or
(iii) the Company or any Subsidiary defaults (whether as
primary
obligor or as guarantor or other surety) in any payment of principal of
or
interest on any other obligation for money borrowed (or any Capitalized
Lease Obligation, any obligation under a conditional sale or other
title
retention agreement, any obligation (other than a current trade payable
which does not constitute Debt) issued or assumed as full or partial
payment for property whether or not secured by a purchase money
mortgage or any obligation under notes payable or drafts accepted
representing extensions of credit) beyond any period of grace provided
with
respect thereto; or the Company or any Subsidiary fails to perform or
observe any other agreement, term or condition contained in any
agreement
under which any such obligation is created (or if any other event
thereunder
or under any such agreement shall occur and be continuing) and the
effect
of such failure or other event is to cause, or to permit the holder or
holders
of such obligation (or a trustee on behalf of such holder or holders)
to
cause, such obligation to become due (or to be repurchased by the
Company or any Subsidiary) prior to any stated maturity, provided that
the
aggregate amount of all obligations as to which such a payment default
shall occur and be continuing or such a failure or other event causing
or
permitting acceleration (or resale to the Company or any Subsidiary)
shall
occur and be continuing exceeds $2,000,000; or
(iv) any representation or warranty made by the Company herein
or by
the Company or any of its officers in any writing furnished in
connection
with or pursuant to this Agreement shall be false in any material
respect
on the date as of which made; or
(v) the Company fails to perform or observe any agreement
contained
in paragraph 6 (other than paragraphs 6C(6), 6F, 6G and 6H and solely
to
the extent that a commercial bank, bank holding company or trust
company
shall fail to meet the standards specified in clause (iii) of paragraph
6C(7)
after the date of an Investment by the Company under such clause (iii),
paragraphs 6C(7)(iii) and solely to the extent a corporation shall fail
to
meet the standards specified in clause (iv) of paragraph 6C(7) after
the date
of an Investment by the Company under such clause (iv),
paragraph 6C(7)(iv)); or
(vi) the Company fails to perform or observe any other
agreement
contained herein and such failure shall not be remedied within 30 days
after any Responsible Officer obtains actual knowledge thereof or after
receipt by the Company of written notice from a holder of a Note of
such
failure; or
(vii) the Company or any Subsidiary makes an assignment for the
benefit of creditors or is generally not paying its debts as such debts
become due; or
(viii) any decree or order for relief in respect of the Company
or any
Subsidiary is entered under any bankruptcy, reorganization, compromise,
arrangement, insolvency, readjustment of debt, dissolution or
liquidation or
similar law, whether now or hereafter in effect (herein called the
Bankruptcy Law), of any jurisdiction; or
(ix) the Company or any Subsidiary petitions or applies to any
tribunal
for, or consents to, the appointment of, or taking possession by, a
trustee,
receiver, custodian, liquidator or similar official of the Company or
any
Subsidiary, or of any substantial part of the assets of the Company or
any
Subsidiary, or commences a voluntary case under the Bankruptcy Law of
the United States or any proceedings (other than proceedings for the
voluntary liquidation and dissolution of a Subsidiary) relating to the
Company or any Subsidiary under the Bankruptcy Law of any other
jurisdiction; or
(x) any such petition or application is filed, or any such
proceedings
are commenced, against the Company or any Subsidiary and the Company
or such Subsidiary by any act indicates its approval thereof, consent
thereto
or acquiescence therein; or an order, judgment or decree is entered
appointing any such trustee, receiver, custodian, liquidator or similar
official, or approving the petition in any such proceedings, and such
order,
judgment or decree remains unstayed and in effect for more than 60
days;
or
(xi) any order, judgment or decree is entered in any
proceedings against
the Company decreeing the dissolution of the Company and such order,
judgment or decree remains unstayed and in effect for more than 60
days;
or
(xii) any order, judgment or decree is entered in any
proceedings
against the Company or any Subsidiary decreeing a split-up of the
Company or such Subsidiary which requires the divestiture of assets
representing a substantial part (being an amount equal to 15% of
Consolidated Assets), or the divestiture of the stock of a Subsidiary
whose
assets represent a substantial part, of the consolidated assets of the
Company and its Subsidiaries (determined in accordance with generally
accepted accounting principles) or which requires the divestiture of
assets,
or stock of a Subsidiary, which shall have contributed at least 15% of
Consolidated Operating Income for any of the three fiscal years then
most
recently ended, and such order, judgment or decree remains unstayed and
in effect for more than 60 days; or
(xiii) a final judgment or judgments in an amount in excess of
$2,000,000, individually or in the aggregate, shall be rendered against
the
Company or any Subsidiary (for which no insurer has acknowledged, in
writing, responsibility for liability, subject to customary deductible)
and,
within 60 days after entry thereof, such judgment is not discharged or
execution thereof stayed pending appeal, or within 60 days after the
expiration of any such stay, such judgment is not discharged; or
(xiv) the Company or any ERISA Affiliate, in its capacity as an
employer under a Multiemployer Plan, makes a complete or partial
withdrawal from such Multiemployer Plan resulting in the incurrence by
such withdrawing employer of a withdrawal liability in an amount
exceeding $2,000,000; or
then:
(a) if such event is an Event of Default specified in clause
(i) or (ii) of
this paragraph 7A, the holder of any Note (other than the Company or
any
Subsidiary or Affiliate) may at its option, by written notice to the
Company, terminate the Facility and/or declare such Note to be, and
such
Note shall thereupon be and become, immediately due and payable at par
together with interest accrued and unpaid thereon, without presentment,
demand, protest or other notice of any kind (including, without
limitation,
notice of intent to accelerate), all of which are hereby waived by the
Company,
(b) if such event is an Event of Default specified in any of
clauses
(vii), (viii), (ix) or (x) of this paragraph 7A with respect to the
Company,
the Facility shall automatically terminate and all of the Notes at the
time
outstanding shall automatically become immediately due and payable at
par
together with interest accrued and unpaid thereon, without presentment,
demand, protest or notice of any kind (including, without limitation,
notice
of intent to accelerate and notice of acceleration of maturity), all of
which
are hereby waived by the Company, and
(c) if such event is any Event of Default other than specified
in clauses
(vii) (viii), (ix) or (x) of this paragraph 7A with respect to the
Company,
the Required Holder(s) may, at its or their option, by written notice
to the
Company, terminate the Facility and declare all of the Notes to be, and
all
of the Notes shall thereupon be and become, immediately due and
payable,
together with interest accrued and unpaid thereon and, to the extent
permitted by applicable law, the Yield-Maintenance Amount, if any, with
respect to each Note, without presentment, demand, protest or other
notice
of any kind (including, without limitation, notice of intent to
accelerate),
all of which are hereby waived by the Company, provided that, to the
extent permitted by applicable law, the Yield-Maintenance Amount, if
any,
with respect to each Note shall be due and payable upon such
declaration
only if:
(x) such Event of Default does not arise under clause
(vii), (viii),
(ix) or (x) of this paragraph 7A with respect to the Company,
(y) the Required Holder(s) shall have given to the
Company, at
least 10 Business Days before such declaration, written notice
stating its or their intention so to declare the Notes to be
immediately due and payable and identifying one or more such
Events of Default whose occurrences on or before the date of such
notice permits such declaration, and
(z) one or more of the Events of Default so identified
shall be
continuing at the time of such declaration.
7B. Rescission of Acceleration. At any time after any or all of the
Notes
shall have been declared immediately due and payable pursuant to paragraph
7A,
the Required Holder(s) may, by notice in writing to the Company, rescind and
annul such declaration and its consequences if:
(i) the Company shall have paid all accrued and unpaid overdue
interest on the Notes, the principal of and Yield-Maintenance Amount,
if
any, payable with respect to any Notes which have become due otherwise
than by reason of such declaration, and accrued and unpaid interest on
such
overdue interest and overdue principal and Yield-Maintenance Amount at
the rate specified in the Notes,
(ii) the Company shall not have paid any amounts which have
become
due solely by reason of such declaration,
(iii) all Events of Default and Defaults, other than
non-payment of
amounts which have become due solely by reason of such declaration,
shall
have been cured or waived pursuant to paragraph 11C, and
(iv) no judgment or decree shall have been entered for the
payment of
any amounts due pursuant to the Notes or this Agreement.
No such rescission or annulment shall extend to or affect any subsequent
Event of
Default or Default or impair any right arising therefrom.
7C. Notice of Acceleration or Rescission. Whenever any Note shall
be
declared immediately due and payable pursuant to paragraph 7A or any such
declaration shall be rescinded and annulled pursuant to paragraph 7B, the
Company
shall forthwith give written notice thereof to the holder of each Note at the
time
outstanding.
7D. Other Remedies. If any Event of Default or Default shall occur
and
be continuing, the holder of any Note may proceed to protect and enforce its
rights
under this Agreement and such Note by exercising such remedies as are
available
to such holder in respect thereof under applicable law, either by suit in
equity or
by action at law, or both, whether for specific performance of any covenant
or
other agreement contained in this Agreement or in aid of the exercise of any
power
granted in this Agreement. No remedy conferred in this Agreement upon the
holder of any Note is intended to be exclusive of any other remedy, and each
and
every such remedy shall be cumulative and shall be in addition to every other
remedy conferred herein or now or hereafter existing at law or in equity or
by
statute or otherwise.
8. REPRESENTATIONS AND WARRANTIES. The Company represents
and warrants as follows:
8A. Organization. The Company is a corporation duly organized and
existing in good standing under the laws of the State of Delaware, and each
Subsidiary is duly organized and existing in good standing under the laws of
the
jurisdiction in which it is incorporated. Schedule 8A hereto is an accurate
and
complete list of all Subsidiaries as of the Date of Closing, including the
jurisdiction of incorporation and ownership of all such Subsidiaries, and as
of
December 31, 1994, the percentage of such Subsidiary's contribution to
Consolidated Operating Income. The Company and each Subsidiary has the
corporate power to own its respective properties and to carry on its
respective
businesses as now being conducted and is duly qualified and authorized to do
business in each other jurisdiction in which the character of its respective
properties or the nature of its respective businesses require such
qualification or
authorization except where the failure to be so qualified or authorized could
not
reasonably be expected to have a material adverse effect on the business,
operations or financial condition of the Company and its Subsidiaries, taken
as a
whole.
8B. Financial Statements. The Company has furnished you with the
following financial statements, identified by a principal financial officer
of the
Company:
(i) a Consolidated balance sheet as at the last day of the
fiscal year in
each of the years 1990 to 1994, inclusive, a Consolidated statement of
income for each such year, and Consolidated statements of stockholder's
equity and cash flows for 1992 to and including 1994, all reported on
by
Coopers and ▇▇▇▇▇▇▇; and
(ii) a Consolidated balance sheet as at April 2, 1995 and
Consolidated
statements of income, stockholders' equity and cash flows for the
three-
month period ended on each such date, prepared by the Company.
Those financial statements (including any related schedules and/or notes)
fairly
present in all material respects (subject, as to interim statements, to the
absence of
footnotes or to changes resulting from normal year-end adjustments) the
financial
condition of the Company and have been prepared in accordance with generally
accepted accounting principles consistently applied throughout the periods
involved
and show all liabilities, direct and contingent, of the Company and its
Subsidiaries
required to be shown in accordance with such principles. The balance sheets
fairly
present, in all material respects, the Consolidated financial condition of
the
Company and its Subsidiaries as at the dates thereof, and the statements of
income,
stockholders' equity and cash flows fairly present, in all material respects,
the
Consolidated results of the operations of the Company and its Subsidiaries,
the
changes in the Company's stockholders' equity and their Consolidated cash
flows
for the periods indicated. There has been no material adverse change in the
business, condition (financial or otherwise) or operations of the Company and
its
Subsidiaries taken as a whole since December 31, 1994.
8C. Actions Pending. There is no action, suit, investigation or
proceeding
pending or, to the knowledge of the Company, threatened against the Company
or
any Subsidiary, or any properties or rights of the Company or any Subsidiary,
by
or before any court, arbitrator or administrative or governmental body which
could
reasonably be expected result in any material adverse change in the business,
condition (financial or otherwise) or operations of the Company and its
Subsidiaries taken as a whole.
8D. Outstanding Debt. Neither the Company nor any Subsidiary has
any
Debt outstanding except as permitted by paragraphs 6A and 6C(2). There is no
default under the provisions of any instrument evidencing any Debt or of any
agreement relating thereto. Schedule 8D hereto is an accurate and complete
list
of Debt of the Company and its Subsidiaries on the Date of Closing.
8E. Title to Properties. The Company and each Subsidiary have good
and
indefeasible title to their respective real properties (other than leased
properties or
which individually or in the aggregate are not material to the Company) and
good
title to all of their other respective properties and assets, including the
properties
and assets reflected in the balance sheet as at April 2, 1995 referred to in
paragraph 8B (other than properties and assets disposed of in the ordinary
course
of business or which individually or in the aggregate are not material to the
Company), subject to no Lien of any kind except Liens permitted by paragraph
6C(1). All leases necessary in any material respect for the conduct of the
respective business of the Company and its Subsidiaries are valid and
subsisting
and are in full force and effect.
8F. Taxes. The Company has and each Subsidiary has filed all
federal,
state and other income tax returns which, to the best knowledge of the
Responsible
Officers of the Company, are required to be filed (giving effect to any
extensions
granted), and each has paid all taxes as shown on such returns and on all
assessments received by it to the extent that such taxes have become due
(including any extensions granted), except such taxes as are being contested
in
good faith by appropriate proceedings for which adequate reserves have been
established in accordance with generally accepted accounting principles.
8G. Conflicting Agreements and Other Matters. Neither the Company
nor
any Subsidiary is a party to any contract or agreement or subject to any
charter or
other corporate restriction which materially and adversely affects its
business,
property or assets, or financial condition of the Company and its
Subsidiaries taken
as a whole. Neither the execution nor delivery of this Agreement or the
Notes, nor
the offering, issuance and sale of the Notes, nor fulfillment of nor
compliance with
the terms and provisions hereof and of the Notes will conflict with, or
result in a
breach of the terms, conditions or provisions of, or constitute a default
under, or
result in any violation of, or result in the creation of any Lien upon any of
the
properties or assets of the Company or any Subsidiary pursuant to, the
charter or
by-laws of the Company or any Subsidiary, any award of any arbitrator or any
agreement (including any agreement with stockholders), instrument, order,
judgment, decree, statute, law, rule or regulation to which the Company or
any
Subsidiary is subject. Neither the Company nor any Subsidiary is a party to,
or
otherwise subject to any provision contained in, any instrument evidencing
Debt
of the Company or such Subsidiary, any agreement relating thereto or any
other
contract or agreement (including its charter) which limits the amount of, or
otherwise imposes restrictions on the incurring of, Debt of the Company of
the
type to be evidenced by the Notes except as set forth in the agreements
listed in
Schedule 8G attached hereto.
8H. Offering of Notes. Neither the Company nor any agent acting on
its
behalf has, directly or indirectly, offered the Notes or any similar security
of the
Company for sale to, or solicited any offers to buy the Notes or any similar
security of the Company from, or otherwise approached or negotiated with
respect
thereto with, any Person other than accredited investors, and neither the
Company
nor any agent acting on its behalf has taken any action which would
reasonably
be expected to subject the issuance or sale of the Notes to the provisions of
section
5 of the Securities Act or to the provisions of any securities or Blue Sky
law of
any applicable jurisdiction. The Company hereby represents and warrants to
you
that, within the preceding twelve months, neither the Company nor any other
Person acting on behalf of the Company has offered or sold to any Person
(other
than accredited investors) any Notes, or any securities of the same or a
similar
class as the Notes, or any other substantially similar securities of the
Company.
8I. Use of Proceeds. Neither the Company nor any Subsidiary owns (othe
than margin stock of insignificant amounts received by the Company as payment
for accounts receivable or otherwise held by the Company) or has any present
intention of acquiring any margin stock as defined in Regulation G (12 CFR
Part 207) of the Board of Governors of the Federal Reserve System (herein
called
margin stock). The proceeds of sale of the Notes will be used for general
corporate purposes. None of such proceeds will be used, directly or
indirectly, for
the purpose, whether immediate, incidental or ultimate, of purchasing or
carrying
any margin stock or for the purpose of maintaining, reducing or retiring any
Debt
which was originally incurred to purchase or carry any stock that is
currently a
margin stock or for any other purpose which might constitute this transaction
a
purpose credit within the meaning of such Regulation G. Neither the
Company
nor any agent acting on its behalf has taken any action which might cause
this
Agreement or the Notes to violate Regulation G, Regulation T or any other
regulation of the Board of Governors of the Federal Reserve System or to
violate
the Exchange Act.
8J. ERISA. No accumulated funding deficiency (as defined in
section 302
of ERISA and section 412 of the Code), whether or not waived, exists with
respect
to any Plan (other than a Multiemployer Plan). No liability to the Pension
Benefit
Guaranty Corporation has been or is expected by the Company or any ERISA
Affiliate to be incurred with respect to any Plan (other than a Multiemployer
Plan)
by the Company, any Subsidiary or any ERISA Affiliate which is or would be
materially adverse to the business, condition (financial or otherwise) or
operations
of the Company and its Subsidiaries taken as a whole. Neither the Company,
any
Subsidiary or any ERISA Affiliate has incurred or presently expects to incur
any
withdrawal liability under Title IV of ERISA with respect to any
Multiemployer
Plan which is or would be materially adverse to the business, condition
(financial
or otherwise) or operations of the Company and its Subsidiaries taken as a
whole.
The execution and delivery of this Agreement and the issuance and sale of the
Notes will be exempt from, or will not involve any transaction which is
subject
to, the prohibitions of section 406 of ERISA and will not involve any
transaction
in connection with which a penalty could be imposed under section 502(i) of
ERISA or a tax could be imposed pursuant to section 4975 of the Code. The
representation by the Company in the next preceding sentence is made in
reliance
upon and subject to the accuracy of your representation in paragraph 9B.
8K. Governmental Consent. Assuming the representations made by you
in paragraph 9 are accurate, neither the nature of the Company or of any
Subsidiary, nor any of their respective businesses or properties, nor any
relationship
between the Company or any Subsidiary and any other Person, nor any
circumstance in connection with the offering, issuance, sale or delivery of
the
Notes is such as to require any authorization, consent, approval, exemption
or other
action by or notice to or filing with any court or administrative or
governmental
body (other than those which are made or obtained prior to Closing and
routine
filings after the date of any Closing with the Securities and Exchange
Commission
and/or state Blue Sky authorities) in connection with the execution and
delivery
of this Agreement, the offering, issuance, sale or delivery of the Notes or
fulfillment of or compliance with the terms and provisions hereof or of the
Notes.
8L. Environmental Compliance.
(i) The Company and its Subsidiaries and all of their respective
Properties
have complied at all times and in all respects with all Environmental
Requirements
where failure to comply could reasonably be expected to have a material
adverse
effect on the business, condition (financial or otherwise) or operations of
the
Company and its Subsidiaries taken as a whole.
(ii) Neither the Company nor any Subsidiary is subject to any
Environmental Liability or Environmental Requirement which could reasonably
be
expected to have a material adverse effect on the business, condition
(financial or
otherwise) or operations of the Company and its Subsidiaries, taken as a
whole.
(iii) Neither the Company nor any Subsidiary has been designated as
a
potentially responsible party under CERCLA or under any state statute similar
to
CERCLA. Except as specified on Schedule 8L, none of the Properties has been
identified on any current or proposed National Priorities List under 40
C.F.R.
300 or any list arising from a state statute similar to CERCLA. None of the
Properties has been identified on any CERCLIS list.
(iv) No Hazardous Materials have been or are being used, produced,
manufactured, processed, generated, stored, disposed of, released, managed at
or
shipped or transported to or from the Properties or are otherwise present at,
on, in
or under the Properties or, to the actual knowledge of the Company, at or
from any
adjacent site or facility, except for Hazardous Materials used, produced,
manufactured, processed, generated, stored, disposed of, released and managed
in
the ordinary course of business in compliance with all applicable
Environmental
Requirements and except for Hazardous Materials present in amounts which have
not required and do not require remediation, pursuant to applicable law or
regulation, or if remediation is required, such remediation could not
reasonably be
expected to have a material adverse effect on the business, condition
(financial or
otherwise) or operations of the Company and its Subsidiaries, taken as a
whole.
(v) The Company and each Subsidiary have procured all permits
necessary
under Environmental Requirements for the conduct of their respective
businesses
or is otherwise in compliance with all applicable Environmental Requirements,
except to the extent the failure to do so could not reasonably be expected to
have
a material adverse effect on the business, condition (financial or otherwise)
or
operations of the Company and its Subsidiaries, taken as a whole.
8M. Disclosure. Neither this Agreement nor any other document,
certificate or statement furnished to you by or on behalf of the Company in
connection herewith contains any untrue statement of a material fact or omits
to
state a material fact necessary in order to make the statements contained
herein and
therein not misleading. There is no fact peculiar to the Company or any
Subsidiary which materially adversely affects or in the future may (so far as
the
Company can now reasonably foresee) materially adversely affect the business,
property or assets, or financial condition of the Company and its
Subsidiaries taken
as a whole and which has not been set forth in this Agreement or in the other
documents, certificates and statements furnished to you by or on behalf of
the
Company prior to the date hereof in connection with the transactions
contemplated
hereby.
8N. Hostile Tender Offers. None of the proceeds of the sale of any
Notes
will be used to finance a Hostile Tender Offer.
9. REPRESENTATIONS OF THE PURCHASER. You represent as
follows:
9A. Nature of Purchase. You are acquiring the Notes to be purchased
by
you hereunder for your own account and not with a view to or for sale in
connection with any distribution thereof within the meaning of the Securities
Act,
provided that the disposition of your property shall at all times be and
remain
within your control.
9B. Source of Funds. No part of the funds being used by you to pay
the
purchase price of the Notes being purchased by you hereunder constitutes
assets
allocated to any separate account maintained by you in which any employee
plan,
other than employee benefit plans identified on a list which has been
furnished by
you to the Company, participates to the extent of 10% or more. For the
purpose
of this paragraph 9B, the terms separate account and employee benefit
plan
shall have the respective meanings specified in section 3 of ERISA.
10. DEFINITIONS. For the purpose of this Agreement, the terms
defined
in the introductory sentence and in paragraphs 1 and 2 shall have the
respective
meanings specified therein, and the following terms shall have the meanings
specified with respect thereto below:
10A. Yield-Maintenance Terms.
Called Principal shall mean, with respect to any Note, the principal
of such
Note that is to be prepaid pursuant to paragraph 4C or is declared to be
immediately due and payable pursuant to paragraph 7A, as the context
requires.
Designated Spread shall mean .50% in the case of each Series A Note
and
0% in the case of each Note of any other Series unless the Confirmation of
Acceptance with respect to the Notes of such Series specifies a different
Designated Spread in which case it shall mean, with respect to each Note of
such
Series, the Designated Spread so specified.
Discounted Value shall mean, 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 Note is payable) equal to the Reinvestment
Yield
with respect to such Called Principal.
Reinvestment Yield shall mean, with respect to the Called Principal of
any
Note, the Designated Spread over the yield to maturity implied by (i) the
yields
reported, as of 10:00 A.M. (New York City time) on the Y-M Business Day next
preceding the Settlement Date with respect to such Called Principal, on the
display
designated as Page 678 on the Telerate (or such other display as may
replace
Page 678 on the Telerate) 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 (ii) if such yields shall not be reported as of such time
or the
yields reported as of such time shall not be ascertainable, the Treasury
Constant
Maturity Series yields reported, for the latest day for which such yields
shall have
been so reported as of the Y-M Business Day next 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 shall be
determined, if necessary, by (a) converting U.S. Treasury ▇▇▇▇ quotations to
bond-
equivalent yields in accordance with accepted financial practice and (b)
interpolating linearly between yields reported for various maturities.
Remaining-Average Life shall mean, with respect to the Called
Principal
of any Note, the number of years (calculated to the nearest one-twelfth year)
obtained by dividing (i) such Called Principal into (ii) the sum of the
products
obtained by multiplying (a) each Remaining Scheduled Payment of such Called
Principal (but not of interest thereon) by (b) the number of years
(calculated to the
nearest one-twelfth year) which 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 shall mean, with respect to the Called
Principal of any Note, all payments of such Called Principal and interest
thereon
that would be due on or 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.
Settlement Date shall mean, with respect to the Called Principal of
any
Note, the date on which such Called Principal is to be prepaid pursuant to
paragraph 4B or is declared to be immediately due and payable pursuant to
paragraph 7A, as the context requires.
Telerate shall mean Telerate Services, Inc. or such other nationally
recognized service providing comparable services as you may select as a
substitute
therefor.
Yield-Maintenance Amount shall mean, with respect to any Note, an
amount equal to the excess, if any, of the Discounted Value of the Called
Principal
of such Note over the sum of (i) such Called Principal plus (ii) interest
accrued
thereon as of (including interest due on) the Settlement Date with respect to
such
Called Principal. The Yield-Maintenance Amount shall in no event be less
than
zero.
Y-M Business Day shall mean any day other than a Saturday, Sunday or
a day on which commercial banks in New York City are required or authorized
to
be closed.
10B. Other Terms.
Acceptance is defined in paragraph 2B(5) of this Agreement.
Acceptance Day is defined in paragraph 2B(5) of this Agreement.
Acceptance Window is defined in paragraph 2B(5) of this Agreement.
Accepted Note is defined in paragraph 2B(5) of this Agreement.
Affiliate shall mean with respect to any Person, any other Person (a)
directly or indirectly controlling or controlled by or under direct or
indirect
common control with such Person, (b) which other Person beneficially owns or
holds 5% or more of the shares of any class of Voting Stock of such Person or
(c)
5% or more of any class of the Voting Stock of which is beneficially owned or
held by such designated entity. For purposes of this definition, control
(including, with correlative meanings, the terms controlled by and under
common control with), as used with respect to any entity, shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of
the management and policies of such entity, whether through the ownership of
Voting Stock or by contract or otherwise. Affiliate shall not include
Subsidiaries.
Authorized Officer shall mean (i) in the case of the Company, its
chief
executive officer, its chief financial officer, any vice president of the
Company
designated as an Authorized Officer of the Company in the Information
Schedule attached hereto or any vice president of the Company designated as
an
Authorized Officer of the Company for the purpose of this Agreement in an
Officers Certificate executed by the Companys chief executive officer or
chief
financial officer and delivered to Prudential, and (ii) in the case of
Prudential, any
officer of Prudential designated as its Authorized Officer in the
Information
Schedule or any officer of Prudential designated as its Authorized Officer
for
the purpose of this Agreement in a certificate executed by one of its
Authorized
Officers. Any action taken under this Agreement on behalf of the Company by
any individual who on or after the date of this Agreement shall have been an
Authorized Officer of the Company and whom Prudential in good faith believes
to be an Authorized Officer of the Company at the time of such action shall
be
binding on the Company even though such individual shall have ceased to be
an
Authorized Officer of the Company, and any action taken under this Agreement
on behalf of Prudential by any individual who on or after the date of this
Agreement shall have been an Authorized Officer of Prudential and whom the
Company in good faith believes to be an Authorized Officer of Prudential at
the
time of such action shall be binding on Prudential even though such
individual
shall have ceased to be an Authorized Officer of Prudential.
Available Facility Amount shall have the meaning specified in
paragraph 2(B)(1) of this Agreement.
Bankruptcy Law is defined in clause (viii) of paragraph 7A of this
Agreement.
Board shall mean, for any Person, its Board of Directors or
equivalent
governing body.
Business Day shall mean any day other than a Saturday, a Sunday or a
day
on which commercial banks in New York City or Charlotte, North Carolina are
required or authorized to be closed.
Cancellation Date is defined in paragraph 2B(8)(iv) of this Agreement.
Cancellation Fee is defined in paragraph 2B(8)(iv) of this Agreement.
Capitalized Lease Obligation shall mean any rental obligation which,
under
generally accepted accounting principles, would be required to be capitalized
on
the books of the Company or any Subsidiary, taken at the amount thereof
accounted for as indebtedness (net of interest expense) in accordance with
such
principles.
CERCLA shall mean the Comprehensive Environmental Response,
Compensation and Liability Act.
CERCLIS shall mean the Comprehensive Environmental Response,
Compensation and Liability Inventory System established pursuant to CERCLA.
Closing Day is defined in paragraph 2B(3)(iv).
Code shall mean the Internal Revenue Code of 1986, as amended.
Confirmation of Acceptance is defined in paragraph 2B(5) of this
Agreement.
Consolidated shall mean the consolidated financial information of the
Company and its Subsidiaries under generally accepted accounting principles.
Consolidated Assets shall mean, as at any date of determination, the
total
assets of the Company and its Subsidiaries appearing on a Consolidated
balance
sheet prepared under generally accepted accounting principles as of the date
of
determination, after deducting any reserves applicable thereto and after
eliminating
all intercompany transactions and all amounts properly attributable to
minority
interests, if any, in the stock and surplus of Subsidiaries.
Consolidated Capitalization shall mean, at any time, the sum of (i)
Consolidated Debt at such time plus (ii) Consolidated Net Worth at such time.
Consolidated Fixed Charges shall mean, for the Company and its
Subsidiaries on a Consolidated basis, the sum (without duplication) of:
(i) all Rentals (excluding all principal components of Rentals
under
Capitalized Lease Obligations) paid during the most recently completed
four fiscal quarters (the Prior Period); and
(ii) all Consolidated Interest Charges for the Prior Period.
Consolidated Interest Charges shall mean, for the Company and its
Subsidiaries on a Consolidated basis for the four fiscal quarters most
recently
ended, all interest expense (as determined in accordance with generally
accepted
accounting principles) on all Debt (including Capitalized Lease Obligations)
net
of interest income.
Consolidated Net Earnings shall mean, for any applicable period, for
the
Company and its Subsidiaries on a Consolidated basis, the excess of (a) gross
revenues over (b) all expenses and charges of a proper character (including
current
and deferred taxes on income and current additions to reserves) each for the
applicable period, but not including in gross revenues:
(i) any gains (net of expenses and taxes applicable thereto) in
excess
of losses resulting from the sales, conversions or other dispositions
of
capital assets outside the ordinary course of business,
(ii) any gains resulting from the write-up of assets,
(iii) any earnings or deferred credit (or amortization of a
deferred
credit) of any Person acquired by the Company or any Subsidiary through
purchase, merger or consolidation or otherwise for any year prior to
the
year of acquisition not included in gross revenues under generally
accepted
accounting principles, or
(iv) any deferred credit representing the excess of equity in
any
Subsidiary of the Company at the date of acquisition over the cost of
the
investment in such Subsidiary,
(v) proceeds of life insurance policies on any Responsible
Officer
exceeding $250,000 for such period,
(vi) gains arising from the acquisition of debt securities for
a cost less
than the principal amount and accrued interest,
(vii) extraordinary items or transactions of a non-recurring or
non-
operating and material nature or arising from gains or sales relating
to the
discontinuance of operations, or
(viii) any portion of the net earnings (included in the
determination of
such Consolidated Net Earnings or such Consolidated Net Loss) of any
Subsidiary which for any reason shall be unavailable for payment of
dividends to the Company,
all as determined in accordance with generally accepted accounting
principles.
If the above calculation results in an amount less than zero, then for such
period
there shall be a Consolidated Net Loss as determined below.
Consolidated Net Loss shall mean, for any applicable period, for the
Company and its Subsidiaries on a Consolidated basis, the excess of (a) expenses
and charges of a proper character (including current and deferred taxes on
income,
provision for taxes an unremitted foreign earnings which are included in
gross
revenues, and current additions to resources) over (b) gross revenues for the
same
period, but not including in gross revenues those items listed in clauses (i)
through
(iv), inclusive, in the definition Consolidated Net Earnings above, all as
determined
in accordance with generally accepted accounting principles. If the above
calculation results in an amount of zero or more, then for such period there
shall
be Consolidated Net Earnings as determined above.
Consolidated Net Worth shall mean, at any time, for the Company and
its
Subsidiaries on a Consolidated basis shareholders' equity at such time
determined
in accordance with generally accepted accounting principles.
Consolidated Operating Income shall mean, for the Company and its
Subsidiaries on a Consolidated basis for the four fiscal quarters most
recently
ended, Consolidated Net Earnings, or Consolidated Net Loss, as the case may
be,
for such period, plus to the extent deducted in calculating such Consolidated
Net
Earnings or Consolidated Net Loss, taxes, Consolidated Interest Charges and
Rentals.
Consolidated Priority Debt shall mean, on a Consolidated basis on any
date
of determination, the sum (without duplication) of:
(i) the aggregate amount of Debt of all Subsidiaries, plus
(ii) Debt of any Person which is secured by, or otherwise
benefitting
from, a Lien on any property, tangible or intangible, of the Company or
any Subsidiary, whether or not the Company or such Subsidiary has
assumed or become liable for the payment of such Debt, plus
(iii) the present value of the rental obligations of the
Company or a
Subsidiary as lessee under a Capitalized Lease Obligation (discounted
according to generally accepted accounting principles at the debt rate
implicit in the lease).
Cumulative Amounts Available For Restricted Payments shall mean for
the
period (taken as one accounting period) beginning on January 1, 1994, and
ending
as of the last day of the most recently completed fiscal quarter before any
proposed
Restricted Payment:
(1) 50% of Consolidated Net Earnings or 100% of the
Consolidated
Net Loss, as the case may be, during such period; plus
(2) the total net cash proceeds received by the Company from
the sale
of its stock during such period; less
(3) the aggregate amount of all Restricted Payments made during
such
period.
Debt shall mean with respect to any Person, at any date of
determination,
(i) all indebtedness for borrowed money which such Person has
directly
or indirectly created, incurred or assumed (including, without
limitation, all
Capitalized Lease Obligations); and
(ii) all indebtedness, whether or not for borrowed money,
secured by
any Lien on any property or asset owned or held by such Person subject
thereto, whether or not the indebtedness secured thereby shall have
been
assumed by such Person; and
(iii) any indebtedness, whether or not for borrowed money, with
respect
to which such Person has become directly or indirectly liable and which
represents or has been incurred to finance the purchase price (or a
portion
thereof) of any property or services or business acquired by such
Person,
whether by purchase, consolidation, merger or otherwise other than any
trade payable in the ordinary course of business that is a current
liability
under generally accepted accounting principles; and
(iv) any indebtedness of the character referred to in clauses
(i), (ii) or
(iii) of this definition deemed to be extinguished under generally
accepted
accounting principles but for which such Person remains legally liable
to
the extent the market value of any assets such Person has placed in
trust for
the benefit of the holders of that indebtedness is less than the
aggregate
amount of that indebtedness; and
(v) any indebtedness of any other Person of the character
referred to in
subdivision (i), (ii), (iii) or (iv) of this definition with respect to
which the
Person whose Debt is being determined has become liable by way of a
Guarantee;
all as determined in accordance with generally accepted accounting
principles,
provided, however, Debt shall not include endorsement of negotiable
instruments
for collection in the ordinary course of business.
Delay Delivery Fee is defined in paragraph 2B(8)(iii) of this
Agreement.
Disposition is defined in paragraph 6D of this Agreement.
Environmental Authority shall mean any foreign, federal, state, local
or
regional government that exercises any form of jurisdiction or authority
under any
Environmental Requirement.
Environmental Judgments and Orders shall mean all judgments, decrees
or
orders arising from or in any way associated with any Environmental
Requirements, whether or not entered upon consent or written agreements with
an
Environmental Authority or other entity arising from or in any way associated
with
any Environmental Requirement, whether or not incorporated in a judgment,
degree or order.
Environmental Liabilities shall mean any liabilities, whether accrued
or
contingent, arising from or relating in any way to any Environmental
Requirements.
Environmental Notices shall mean any written communication from any
Environmental Authority stating possible or alleged noncompliance with or
possible or alleged liability under any Environmental Requirement, including
without limitation any complaints, citations, demands or requests from any
Environmental Authority for correction of any purported violation of any
Environmental Requirements or any investigation concerning any purported
violation of any Environmental Requirements. Environmental Notices also
shall
mean (i) any written communication from any other Person threatening
litigation
or administrative proceedings against or involving the Company relating to
alleged
violation of any Environmental Requirements and (ii) any complaint, petition
or
similar documents filed by any other Person commencing litigation or
administrative proceedings against or involving the Company relating to
alleged
violation of any Environmental Requirements.
Environmental Proceedings shall mean any judicial or administrative
proceedings arising from or in any way associated with any Environmental
Requirement.
Environmental Releases shall mean releases (as defined in CERCLA or
under any applicable state or local environmental law or regulation) of
Hazardous
Materials. Environmental Releases does not include releases for which no
remediation or reporting is required by applicable Environmental Requirements
and
which do not present a danger to health, safety or the environment.
Environmental Requirements shall mean any applicable local, state or
federal law, rule, regulation, permit, order, decision, determination or
requirement
relating in any way to Hazardous Materials or to health, safety or the
environment.
ERISA shall mean the Employee Retirement Income Security Act of 1974,
as amended.
ERISA Affiliate shall mean any corporation which is a member of the
same
controlled group of corporations as the Company within the meaning of section
414(b) of the Code, or any trade or business which is under common control
with
the Company within the meaning of section 414(c) of the Code.
Event of Default shall mean any of the events specified in paragraph
7A,
provided that there has been satisfied any requirement in connection with
such
event for the giving of notice, or the lapse of time, or the happening of any
further
condition, event or act, and Default shall mean any of such events, whether
or
not any such requirement has been satisfied.
Exchange Act shall mean the Securities Exchange Act of 1934, as
amended.
Facility is defined in paragraph 2B(1) of this Agreement.
Facility Fee is defined in paragraph 2B(8)(i) of this Agreement.
Fair Market Value shall mean at any time, the sale value of 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, under no compulsion to buy
or
sell, respectively.
Guarantee shall mean, with respect to any Person, any direct or
indirect
liability, contingent or otherwise, of such Person with respect to any Debt,
lease,
dividend or other obligation of another, including, without limitation, any
such
obligation directly or indirectly guaranteed, endorsed (otherwise than for
collection
or deposit in the ordinary course of business) or discounted or sold with
recourse
by such Person, or in respect of which such Person is otherwise directly or
indirectly liable, including, without limitation, any such obligation in
effect
guaranteed by such Person through any agreement (contingent or otherwise) to
purchase, repurchase or otherwise acquire such obligation or any security
therefor,
or to provide funds for the payment or discharge of such obligation (whether
in the
form of loans, advances, stock purchases, capital contributions or
otherwise), or to
maintain the solvency or any balance sheet or other financial condition of
the
obligor of such obligation, or to make payment for any products, materials or
supplies or for any transportation or services regardless of the non-delivery
or non-
furnishing thereof, in any such case if the purpose or intent of such
agreement is
to provide assurance that such obligation will be paid or discharged, or that
any
agreements relating thereto will be complied with, or that the holders of
such
obligation will be protected against loss in respect thereof. The amount of
any
Guarantee shall be equal to the outstanding principal amount of the
obligation
guaranteed or such lesser amount to which the maximum exposure of the
guarantor
shall have been specifically limited.
Hazardous Materials shall mean (a) hazardous waste as defined in the
Resource Conservation and Recovery Act of 1976, or in any applicable federal,
state or local law or regulation, (b) hazardous substances, as defined in
CERCLA,
or in any applicable state or local law or regulation, (c) gasoline, or any
other
petroleum product or by-product, (d) toxic substances, as defined in the
Toxic
Substances Control Act of 1976, or in any applicable federal, state or local
law or
regulation or (e) insecticides, fungicides, or rodenticides, as defined in
the Federal
Insecticide, Fungicide, and Rodenticide Act of 1975, or in any applicable
federal,
state or local law or regulation, as each such Act, statute or regulation may
be
amended from time to time.
Hedge Treasury Note(s) shall mean, with respect to any Accepted
Note, the United States Treasury Note or Notes whose duration (as
determined by Prudential) most closely matches the duration of such
Accepted Note.
Hostile Tender Offer shall mean, 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.
Investment shall mean, when used with respect to any Person, any
direct
or indirect advance, loan or other extension of credit (other than the
creation of
receivables in the ordinary course of business) or capital contribution by
such
Person (by means of transfers of property to others or payments for property
or
services for the account or use of others, or otherwise) to any other Person,
or any
direct or indirect purchase or other acquisition by such Person of, or of a
beneficial
interest in, capital stock, partnership interests, bonds, notes, debentures
or other
securities issued by any other Person.
Issuance Fee is defined in paragraph 2B(8)(ii) of this Agreement.
Issuance Period is defined in paragraph 2B(2) of this Agreement.
▇▇▇ Management Agreement shall mean that certain Management
Agreement dated September 29, 1988 among ▇▇▇▇▇▇ ▇. ▇▇▇ Company and
▇▇▇▇▇▇▇ Holding Corporation, a Delaware corporation (Holding), ▇▇▇▇▇▇▇
Acquisition Corporation, a Delaware corporation (Acquisition), and
Interiors
Acquisition Corporation, a Delaware corporation (Interiors), the Company
being
a successor by merger to Holdings, Acquisition and Interiors, as amended,
modified or supplemented from time to time with the prior consent of the
Required
Holders.
Lien shall mean any mortgage, pledge, security interest, encumbrance,
lien
(statutory or otherwise), or charge of any kind (including any agreement to
give
any of the foregoing, any conditional sale or other title retention
agreement, any
lease in the nature thereof, and the filing of or agreement to give any
financing
statement under the Uniform Commercial Code of any jurisdiction) or any other
type of preferential arrangement for the purpose, or having the effect, of
protecting
a creditor against loss or securing the payment or performance of an
obligation,
including any rights of setoff (whether by statute, common law, contract or
otherwise).
Multiemployer Plan shall mean any Plan which is a multiemployer plan
(as such term is defined in section 4001(a)(3) of ERISA).
Notes is defined in paragraph 1B of this Agreement.
Officer's Certificate shall mean a certificate signed in the name of
the
Company by its Chairman, President, one of its Vice Presidents or its
Treasurer.
Person shall mean and include an individual, a partnership, a joint
venture,
a corporation, a trust, an unincorporated organization and a government or
any
department or agency thereof.
Plan shall mean any employee pension benefit plan (as such term is
defined in section 3 of ERISA) which is or has been established or
maintained, or
to which contributions are or have been made, by the Company or any ERISA
Affiliate.
Preferred Stock, as applied to any corporation, shall mean shares of
stock
of such corporation which are entitled to preference or priority over any
other
shares of such corporation in respect of the payment of dividends or
distribution
of assets upon liquidation or both.
Properties shall mean all real property owned, leased or otherwise
used or
occupied by the Company or any Subsidiary, wherever located.
Prudential is defined in the Introduction of this Agreement.
Purchasers is defined in the Introduction of this Agreement.
Rentals shall mean for any period of determination all fixed rents or
charges
(including as such all payments during any such period of determination which
the
lessee is obligated to make on termination of the lease or surrender of the
property)
payable by the Company or a Subsidiary (as lessee, sublessee, license,
franchisee
or the like) for such period under a lease, license, or other agreement for
the use
or possession of real or personal property, tangible or intangible, as
determined in
accordance with generally accepted accounting principles.
Request for Purchase is defined in paragraph 2B(3) of this Agreement.
Required Holder(s) shall mean the holder or holders of at least 66
2/3% of
the aggregate principal amount of the Notes from time to time outstanding.
Rescheduled Closing Day is defined in paragraph 2B(7) of this
Agreement.
Responsible Officer shall mean the chief executive officer, chief
operating
officer, principal financial officer, principal accounting officer, treasurer
or assistant
treasurer of the Company or any other senior executive officer of the Company
involved principally in its financial administration or its controllership
function.
Restricted Payments is defined in paragraph 6B of this Agreement.
Securities Act shall mean the Securities Act of 1933, as amended.
Series A Closing Day is defined in paragraph 2A of this Agreement.
Series A Notes is defined in paragraph 1A of this Agreement.
Shelf Notes is defined in paragraph 1B of this Agreement.
Significant Holder shall mean (i) you, so long as you shall hold (or
be
committed under this Agreement to purchase) any Note, or (ii) any other
Person
which holds at least $5,000,000 of the aggregate principal amount of the
Notes
from time to time outstanding.
Subsidiary shall mean any corporation or partnership organized under
the
laws of any state of the United States of America which conducts the major
portion of its business in and makes the major portion of its sales to
Persons
located in the United States or Canada, whose accounts are or are required to
be
consolidated with the Company's under generally accepted accounting
principles.
Third Party shall mean all lessees, sublessees, licensees and other
users of
the Properties, excluding those users of the Properties in the ordinary
course of the
Company's business (consistent with its practices on the Date of Closing) and
on
a temporary basis.
Transferee shall mean any direct or indirect transferee of all or any
part of
any Note purchased by you under this Agreement.
Voting Stock shall mean, 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 shall mean any Subsidiary, all of the Voting
Stock of which shall, at the time of determination, be owned by the Company
or
another Wholly-Owned Subsidiary.
10C. Accounting Principles, Terms and Determinations. All
references inthis Agreement to generally accepted accounting principles shall be
deemed
torefer to generally accepted accounting principles in effect in the United
States at
the time of application thereof. Unless otherwise specified herein, all
accounting
terms used herein shall be interpreted, all determinations with respect to
accounting
matters hereunder shall be made, and all unaudited financial statements and
certificates and reports as to financial matters required to be furnished
hereunder
shall be prepared, in accordance with generally accepted accounting
principles,
applied on a basis consistent with the most recent audited consolidated
financial
statements of the Company and its Subsidiaries delivered pursuant to clause
(ii) of
paragraph 5A or, if no such statements have been so delivered, the most
recent
audited financial statements referred to in clause (i) of paragraph 8B,
subject in the
case of, interim statements to normal year end adjustments and to the absence
of
footnotes.
11. MISCELLANEOUS.
11A. Note Payments. The Company agrees that, so long as you shall
hold
any Note, it will make payments of principal of, interest on, and any Yield-
Maintenance Amount payable with respect to such Note, which comply with the
terms of this Agreement, by wire transfer of immediately available funds for
credit
(not later than 12:00 noon, New York City time, on the date due) to your
account
or accounts as specified in the Purchaser Schedule attached hereto, or such
other
account or accounts in the United States as you may designate in writing,
notwithstanding any contrary provision herein or in any Note with respect to
the
place of payment. You agree (and any Transferee shall agree as a condition
to the
transfer of any Note or part thereof) that, before disposing of any Note, you
(and
any such Transferee) will make a notation thereon (or on a schedule attached
thereto) of all principal payments previously made thereon and of the date to
which interest thereon has been paid. The Company agrees to afford the
benefits
of this paragraph 11A to any Transferee which shall have made the same
agreement as you have made in this paragraph 11A.
11B. Expenses. The Company agrees, whether or not the transactions
contemplated hereby shall be consummated, to pay, and save you and any
Transferee harmless against liability for the payment of, all reasonable
out-of-
pocket expenses actually incurred (including without limitation legal fees)
arising
in connection with such transactions, including:
(i) all taxes (together in each case with interest and
penalties, if any),
other than state or federal income taxes or franchise taxes, including
without limitation, all stamp, intangibles, recording and other taxes,
which
may be payable with respect to the execution and delivery of this
Agreement or the execution, delivery or acquisition of any Note;
(ii) all reasonable document production and duplication charges
and the
reasonable fees and expenses of any special counsel engaged by you or
any
Transferee after the Date of Closing in connection with this Agreement
or
the Notes and any subsequent proposed modification or waiver of, or
proposed consent under, this Agreement or the Notes, whether or not
such
proposed modification or waiver shall be effected or proposed consent
granted, and
(iii) the reasonable costs and expenses, including reasonable
attorneys'
fees, actually incurred by you or such Transferee in connection with
the
restructuring, refinancing or work out of this Agreement or the Notes
or
the transactions contemplated hereby or thereby or in enforcing (or
determining whether or how to enforce) any rights under this Agreement
or the Notes or in responding to any subpoena or other legal process or
informal investigative demand issued in connection with this Agreement
or
the Notes or the transactions contemplated hereby or by reason of your
or
any Transferee's having acquired any Note, including without limitation
costs and expenses incurred in any bankruptcy case.
The obligations of the Company under this paragraph 11B shall survive the
transfer
of any Note or portion thereof or interest therein by you or any Transferee
and the
payment of any Note.
11C. Consent to Amendments. This Agreement may be amended, and the
Company may take any action herein prohibited, or omit to perform any act
herein
required to be performed by it, if the Company shall obtain the written
consent to
such amendment, action or omission to act, of the Required Holder(s) except
that,
without the written consent of the holder or holders of all Notes at the time
outstanding, no amendment to this Agreement shall change:
(i) the maturity of any Note,
(ii) the principal of, or the rate or time of payment of
interest on or any
Yield-Maintenance Amount payable on any Note,
(iii) the time, amount or allocation of any prepayments, or
(iv) the proportion of the principal amount of the Notes
required for
any consent, amendment, waiver or declaration.
Each holder of any Note at the time or thereafter outstanding shall be bound
by
any consent authorized by this paragraph 11C, whether or not such Note shall
have
been marked to indicate such consent, but any Notes issued thereafter may
bear a
notation referring to any such consent. 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 and in the Notes, the term this Agreement and
references thereto shall mean this Agreement as it may from be amended or
supplemented time to time.
11D. Form, Registration, Transfer and Exchange of Notes; Lost Notes.
The
Notes are issuable in registered form without coupons in denominations of at
least
$1,000,000, except as may be necessary to reflect any principal amount not
evenly
divisible by $1,000,000. The Company shall keep at its principal office a
register
in which the Company shall provide for the registration of Notes and a record
of
transfers of the Notes. Upon surrender for registration of transfer of any
Note at
the principal office of the Company, the Company shall, at its expense,
execute
and deliver one or more new Notes of like tenor and of a like aggregate
principal
amount, registered in the name of such transferee or transferees. At the
option of
the holder of any Note, such Note may be exchanged for other Notes of like
tenor
and of any authorized denominations, of a like aggregate principal amount,
upon
surrender of the Note to be exchanged at the principal office of the Company.
Whenever any Notes are so surrendered for exchange, the Company shall, at its
expense, execute and deliver the Notes which the holder making the exchange
is
entitled to receive. Every Note surrendered for registration of transfer or
exchange
shall be duly endorsed, or be accompanied by a written instrument of transfer
duly
executed, by the holder of such Note or such holder's attorney duly
authorized in
writing. Any Note or Notes issued in exchange for any Note or upon transfer
thereof shall carry the rights to unpaid interest and interest to accrue
which were
carried by the Note so exchanged or transferred, so that neither gain nor
loss of
interest shall result from any such transfer or exchange. Upon receipt of
written
notice from the holder of any Note of the loss, theft, destruction or
mutilation of
such Note and, in the case of any such loss, theft or destruction, upon
receipt of
such holder's unsecured indemnity agreement, or in the case of any such
mutilation
upon surrender and cancellation of such Note, the Company will make and
deliver
a new Note, of like tenor, in lieu of the lost, stolen, destroyed or
mutilated Note.
11E. Persons Deemed Owners; Participations. Prior to due
presentment for
registration of transfer, the Company shall treat the Person in whose name
any
Note is registered as the owner and holder of such Note for the purpose of
receiving payment of principal of, interest on and any Yield-Maintenance
Amount
payable with respect to such Note and for all other purposes whatsoever,
whether
or not such Note shall be overdue, and the Company shall not be affected by
notice to the contrary. Subject to the preceding sentence, the holder of any
Note
may from time to time grant participations in such Note to any Person (other
than
any Person not an institutional investor) on such terms and conditions as may
be
determined by such holder in its sole and absolute discretion.
11F. Survival of Representations and Warranties; Entire Agreement.
All
representations and warranties contained herein or made in writing by or on
behalf
of the Company in connection herewith shall survive the execution and
delivery
of this Agreement and the Notes, the transfer by you of any Note or portion
thereof or interest therein and the payment of any Note, and may be relied
upon
by any Transferee, regardless of any investigation made at any time by or on
behalf of you or any Transferee. Subject to the preceding sentence, this
Agreement and the Notes embody the entire agreement and understanding between
you and the Company and supersede all prior agreements and understandings
relating to the subject matter hereof.
11G. Successors and Assigns; Transfer Provisions. All covenants and
other
agreements in this Agreement contained by or on behalf of either of the
parties
hereto shall bind and inure to the benefit of the respective successors and
assigns
of the parties hereto (including, without limitation, any Transferee) whether
so
expressed or not.
11H. Disclosure to Other Persons; Confidentiality. The Company
acknowledges that the holder of any Note may deliver copies of any financial
statements and other documents or information delivered to such holder, and
disclose any other information disclosed to such holder, by or on behalf of
the
Company or any Subsidiary in connection with or pursuant to this Agreement
only
to:
(i) such holder's directors, officers, employees, agents and
professional
consultants,
(ii) any other holder of any Note,
(iii) any Person to which such holder offers to sell such Note
or any
part thereof, provided that each such Person agrees in writing to
observe
the confidentiality standards described in this paragraph 11H,
(iv) any Person to which such holder sells or offers to sell a
participation in all or any part of such Note, provided that each such
Person
agrees in writing to observe the confidentiality standards described in
this
paragraph 11H,
(v) any Person from which such holder offers to purchase any
security
of the Company, provided that each such Person agrees in writing to
observe the confidentiality standards described in this paragraph 11H,
(vi) any federal or state regulatory authority having
jurisdiction over
such holder,
(vii) the National Association of Insurance Commissioners or
any
similar organization or
(viii) any other Person to which such delivery or disclosure
may be
necessary or reasonably appropriate (a) in compliance with any law,
rule,
regulation or order applicable to such holder, (b) in response to any
subpoena or other legal process or informal investigative demand or (c)
in
connection with any litigation to which such holder is a party.
Subject to the foregoing, each holder of a Note hereby agrees to use its
best
efforts to hold in confidence and not to disclose any Confidential
Information;
provided, that such holder will be free, after notice to the Company, to
correct any
false or misleading information which may become public concerning its
relationship to the Company. For the purpose of this paragraph 11H, the term
Confidential Information shall mean information about the Company or any
Subsidiary furnished by the Company or any Subsidiary to such holder, but
does
not include any information (i) which as publicly known, or otherwise known
to
such holder, at the time of disclosure, (ii) which subsequently becomes
publicly
known through no act or omission by such holder, or (iii) which otherwise
becomes known to such holder other than through disclosure by the Company or
any Subsidiary.
11I. Notices. All written communications provided for hereunder
shall be
sent by first class mail or nationwide overnight delivery service (with
charges
prepaid) and
(i) if to you, addressed to you at the address specified for
such
communications in the Purchaser Schedule attached hereto, or at such
other
address as you shall have specified to the Company in writing,
(ii) if to any other holder of any Note, addressed to such
other holder
at such address as such other holder shall have specified to the
Company
in writing or, if any such other holder shall not have so specified an
address to the Company, then addressed to such other holder in care of
the
last holder of such Note which shall have so specified an address to
the
Company, and
(iii) if to the Company, addressed to it at ▇.▇. ▇▇▇ ▇▇, ▇▇▇▇▇
▇▇,
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Telephone: (▇▇▇) ▇▇▇-▇▇▇▇, Telecopy: (703)
629-5114, Attention: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Vice President - Treasurer,
or
at such other address as the Company shall have specified to the holder
of
each Note in writing.
11J. Payments Due on Non-Business Days. Anything in this Agreement
or the Notes to the contrary notwithstanding, any payment of principal of or
interest on any Note that is due on a date other than a Business Day shall be
made
on the next succeeding Business Day. If the date for any payment is extended
to
the next succeeding Business Day by reason of the preceding sentence, the
period
of such extension shall be included in the computation of the interest
payable on
such Business Day.
11K. Satisfaction Requirement. If any agreement, certificate or
other
writing, or any action taken or to be taken, is by the terms of this
Agreement
required to be satisfactory to you or to the Required Holder(s), the
determination
of such satisfaction shall be made by you or the Required Holder(s), as the
case
may be, in the sole and exclusive judgment (exercised in good faith) of the
Person
or Persons making such determination.
11L. Independence of Covenants. All covenants of the Company
hereunder
shall be of independent effect so that if a particular action or condition is
not
permitted by any one of such covenants, the fact that it would be permitted
by an
exception to, or otherwise be within the other limitations of, another
covenant,
shall not avoid the occurrence of an Event of Default or Default if such
action is
taken or condition exists.
11M. 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. THE COMPANY HEREBY SUBMITS TO THE
JURISDICTION OF THE SUPREME COURT OF THE STATE OF NEW YORK
LOCATED IN NEW YORK COUNTY, NEW YORK AND THE UNITED
STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW
YORK AND IRREVOCABLY AGREES THAT, SUBJECT TO THE SOLE AND
ABSOLUTE ELECTION OF THE REQUIRED HOLDER(S) AND TO THE
EXTENT PERMITTED BY APPLICABLE LAW, ALL ACTIONS OR
PROCEEDINGS RELATING TO THIS AGREEMENT OR THE NOTES SHALL
BE LITIGATED IN SUCH COURTS, AND THE COMPANY WAIVES ANY
OBJECTION WHICH IT MAY HAVE BASED ON IMPROPER VENUE OR
FORUM NON CONVENIENS TO THE CONDUCT OF ANY PROCEEDING
IN ANY SUCH COURTS.
11N. Severability. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to
the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in
any
jurisdiction shall not invalidate or render unenforceable such provision in
any other
jurisdiction.
11O. Descriptive Headings. The descriptive headings of the several
paragraphs of this Agreement are inserted for convenience only and do not
constitute a part of this Agreement.
11P. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together
shall constitute one instrument.
If you agree to the foregoing, please sign the form of acceptance on the
enclosed counterpart of this letter and return the same to the Company,
whereupon
this letter shall become a binding agreement between the Company and you.
Very truly yours,
▇▇▇▇▇▇▇ FURNITURE COMPANY,
INC.
By:______________________________
Title:
The foregoing Agreement is
hereby accepted as of the date
first above written.
THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA
By:____________________________
Title:
EXHIBIT A-1
[FORM OF SERIES A NOTE]
▇▇▇▇▇▇▇ FURNITURE COMPANY, INC.
7.57% SENIOR SERIES A NOTE DUE JUNE 29, 2005
No. _____ [Date]
$10,000,000
FOR VALUE RECEIVED, the undersigned, ▇▇▇▇▇▇▇ FURNITURE
COMPANY, INC. (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 TEN
MILLION DOLLARS ($10,000,000) on June 29, 2005, with interest (computed
on the basis of a 360-day year--30-day month) (a) on the unpaid balance
thereof
at the rate of 7.57% per annum from the date hereof, payable semi-annually on
the
29th day of December and June in each year, commencing with the December 29
next succeeding the date hereof, until the principal hereof shall have become
due
and payable, and (b) on any overdue payment (including any overdue
prepayment)
of principal, any overdue payment of Yield Maintenance Amount and any overdue
payment of interest, payable semi-annually 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) 9.57% or (ii) 2% over the rate of interest publicly
announced
by ▇▇▇▇▇▇ Guaranty Trust Company of New York from time to time in New York
City as its Prime Rate.
Payments of principal, Yield Maintenance Amount, if any, and interest
are to
be made at the main office of ▇▇▇▇▇▇ Guaranty Trust Company of New York in
New York City or at such other place as the holder hereof shall designate to
the
Company in writing, in lawful money of the United States of America.
This Note is one of a series of Senior Notes (herein called the Notes)
issued
pursuant to a Note Purchase and Private Shelf Agreement, dated as of June __,
1995 (herein called the Agreement), between the Company, on the one hand,
and The Prudential Insurance Company of America and each Prudential Affiliate
which becomes party thereto, on the other hand, and is entitled to the
benefits
thereof. As provided in the Agreement, this Note is subject to prepayment,
in
whole or from time to time in part, with the Yield Maintenance Amount
specified
in the Agreement.
This Note is a registered Note and, as provided in the 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 the then
outstanding 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
shall
not be affected by any notice to the contrary.
The Company agrees to make prepayments of principal of this Note on the
dates and in the amounts specified in the Agreement.
In case an Event of Default shall occur and be continuing, the principal
of this
Note may be declared or otherwise become due and payable in the manner and
with the effect provided in the Agreement.
The Company and any and all endorsers, guarantors and sureties severally
waive grace, demand, presentment for payment, notice of dishonor or default,
notice of intent to accelerate, notice of acceleration (to the extent set
forth in the
Agreement), protest and diligence in collecting.
Should any debt represented by this Note be collected at law or in
equity, or
in bankruptcy or other proceedings, or should this Note be placed in the
hands of
attorneys for collection, the Company agrees to pay, in addition to the
principal,
Yield-Maintenance Amount, if any, and interest due and payable hereon, all
costs
of collecting or attempting to collect this Note, including reasonable
attorneys
fees and expenses (including those incurred in connection with any appeal).
Capitalized terms used and not otherwise defined herein shall have the
meanings (if any) provided in the Agreement.
This Note is intended to be performed in the State of New York and shall
be
construed and enforced in accordance with the internal law of such State.
As
provided in paragraph 11M of the Agreement, the Company submits to the
jurisdiction of the Supreme Court of the State of New York located in New
York
County, New York and the United States District Court for the Southern
District
of New York in any action or proceeding relating to this Note.
▇▇▇▇▇▇▇ FURNITURE COMPANY, INC.
By: ____________________________
Title: ___________________________
EXHIBIT A-2
[FORM OF SHELF NOTE]
▇▇▇▇▇▇▇ FURNITURE COMPANY, INC.
SENIOR SERIES ___ NOTE
No.
ORIGINAL PRINCIPAL AMOUNT:
ORIGINAL ISSUE DATE:
INTEREST RATE:
INTEREST PAYMENT DATES:
FINAL MATURITY DATE:
PRINCIPAL PREPAYMENT DATES AND AMOUNTS:
FOR VALUE RECEIVED, the undersigned, ▇▇▇▇▇▇▇ FURNITURE
COMPANY, INC. (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 the Final Maturity Date specified
above]
[, payable on the Principal Prepayment Dates and in the amounts specified
above,
and on the Final Maturity Date specified above in an amount equal to the
unpaid
balance of the principal hereof,] with interest (computed on the basis of a
360-day
year--30-day month) (a) on the unpaid balance thereof at the Interest Rate
per
annum specified above, payable on each Interest Payment Date specified above
and
on the Final Maturity Date specified above, commencing with the Interest
Payment
Date next succeeding the date hereof, until the principal hereof shall have
become
due and payable, and (b) on any overdue payment (including any overdue
prepayment) of principal, any overdue payment of Yield Maintenance Amount and
any overdue payment of interest, payable on each Interest Payment Date 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) 2% over the Interest
Rate
specified above or (ii) 2% over the rate of interest publicly announced by
▇▇▇▇▇▇
Guaranty Trust Company of New York from time to time in New York City as its
Prime Rate.
Payments of principal, Yield Maintenance Amount, if any, and interest
are to
be made at the main office of ▇▇▇▇▇▇ Guaranty Trust Company of New York in
New York City or at such other place as the holder hereof shall designate to
the
Company in writing, in lawful money of the United States of America.
This Note is one of a series of Senior Notes (herein called the Notes)
issued
pursuant to a Note Purchase and Private Shelf Agreement, dated as of June 29,
1995 (herein called the Agreement), between the Company, on the one hand,
and The Prudential Insurance Company of America and each Prudential Affiliate
(as defined in the Agreement) which becomes party thereto, on the other hand,
and
is entitled to the benefits thereof.
[This Note is subject to optional prepayment, in whole or from time to
time
in part, on the terms specified in the Agreement.]
This Note is a registered Note and, as provided in the 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 the then
outstanding 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
shall
not be affected by any notice to the contrary.
In case an Event of Default shall occur and be continuing, the principal
of this
Note may be declared or otherwise become due and payable in the manner and
with the effect provided in the Agreement.
Capitalized terms used and not otherwise defined herein shall have the
meanings (if any) provided in the Agreement.
The Company and any and all endorsers, guarantors and sureties severally
waive grace, demand, presentment for payment, notice of dishonor or default,
notice of intent to accelerate, notice of acceleration (to the extent set
forth in the
Agreement), protest and diligence in collecting.
Should any debt represented by this Note be collected at law or in
equity, or
in bankruptcy or other proceedings, or should this Note be placed in the
hands of
attorneys for collection, the Company agrees to pay, in addition to the
principal,
Yield-Maintenance Amount, if any, and interest due and payable hereon, all
costs
of collecting or attempting to collect this Note, including reasonable
attorneys
fees and expenses (including those incurred in connection with any appeal).
This Note is intended to be performed in the State of New York and shall
be
construed and enforced in accordance with the internal law of such State.
As
provided in paragraph 11M of the Agreement, the Company submits to the
jurisdiction of the Supreme Court of the State of New York located in New
York
County, New York and the United States District Court for the Southern
District
of New York in any action or proceeding relating to this Note.
▇▇▇▇▇▇▇ FURNITURE COMPANY, INC.
By: ____________________________
Title: ___________________________
EXHIBIT B
[FORM OF REQUEST FOR PURCHASE]
▇▇▇▇▇▇▇ FURNITURE COMPANY, INC.
Reference is made to the Note Purchase and Private Shelf Agreement
(the Agreement), dated as of June __, 1995 between ▇▇▇▇▇▇▇
FURNITURE COMPANY, INC. (the Company), on the one hand, and The
Prudential Insurance Company of America (Prudential) and each
Prudential Affiliate which becomes party thereto, on the other hand.
Capitalized terms used and not otherwise defined herein shall have the
respective meanings specified in the Agreement.
Pursuant to Paragraph 2B(4) of the Agreement, the Company hereby
makes the following Request for Purchase:
1. Aggregate principal amount of
the Notes covered hereby
(the Notes) $
2. Individual specifications of the Notes:
Interest
Principal Principal Payment
Final Prepayment
Amount Maturity Dates and
Period Date Amounts
3. Use of proceeds of the Notes:
4. Proposed day for the closing of the purchase and sale of the
Notes:
5. The purchase price of the Notes is to be transferred to:
Name, Address
and ABA Routing Number of
Number of Bank Account
6. The Company certifies (a) that the representations and warranties
contained in paragraph 8 of the Agreement are true on and as of the
date of this Request for Purchase except to the extent of changes
caused by the transactions contemplated in the Agreement and (b)
that there exists on the date of this Request for Purchase no Event
of Default or Default.
7. In connection with any rate quotes it may provide, Prudential should
assume a Designated Spread of _____%.
Dated: ▇▇▇▇▇▇▇ FURNITURE COMPANY, INC.
By:_________________________
Authorized Officer
EXHIBIT C
[FORM OF CONFIRMATION OF ACCEPTANCE]
▇▇▇▇▇▇▇ FURNITURE COMPANY, INC.
Reference is made to the Note Purchase and Private Shelf Agreement (the
Agreement), dated as of June __, 1995 between ▇▇▇▇▇▇▇ FURNITURE
COMPANY, INC. (the Company), on the one hand, and The Prudential
Insurance Company of America (Prudential) and each Prudential Affiliate
which
becomes party thereto, on the other hand. All terms used herein that are
defined
in the Agreement have the respective meanings specified in the Agreement.
Prudential or the Prudential Affiliate which is named below as a
Purchaser of
Notes hereby confirms the representations as to such Notes set forth in
paragraph
9 of the Agreement, and agrees to be bound by the provisions of paragraphs
2B(5)
and 2B(6) of the Agreement relating to the purchase and sale of such Notes
and
by the provisions of the penultimate sentence of paragraph 11A of the
Agreement.
Pursuant to paragraph 2B(5) of the Agreement, an Acceptance with respect
to
the following Accepted Notes is hereby confirmed:
I. Accepted Notes: Aggregate principal
amount $__________________
(A) (a) Name of Purchaser:
(b) Principal amount:
(c) Final maturity date:
(d) Principal prepayment dates and amounts:
(e) Interest rate:
(f) Interest payment period:
(g) Payment and notice instructions: As set
forth on attached Purchaser Schedule
(h) Designated Spread: ___%
(B) (a) Name of Purchaser:
(b) Principal amount:
(c) Final maturity date:
(d) Principal prepayment dates and amounts:
(e) Interest rate:
(f) Interest payment period:
(g) Payment and notice instructions: As set
forth on attached Purchaser Schedule
[(h) Designated Spread: ___%]
[(C), (D)..... same information as above.]
II. Closing Day:
Dated: ▇▇▇▇▇▇▇ FURNITURE COMPANY, INC.
By:
Title:
[THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA]
By:
Vice President
[PRUDENTIAL AFFILIATE]
By:
Vice President
EXHIBIT D-1
[FORM OF OPINION OF COMPANY'S COUNSEL]
[Letterhead of ▇▇▇▇▇▇▇ ▇▇▇▇▇ Battle & ▇▇▇▇▇▇, L.L.P.]
[Date of Series A Closing Day]
The Prudential Insurance Company of America
Four Gateway Center
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
We have acted as counsel for ▇▇▇▇▇▇▇ Furniture Company, Inc. (the
Company) in connection with the Note Purchase and Private Shelf Agreement,
dated as of June 29, 1995 (the Agreement) between the Company, on the one
hand, and The Prudential Insurance Company of America and each Prudential
Affiliate which becomes a party thereto, on the other hand, pursuant to which
the
Company has issued to you today its Senior Series A Notes in the aggregate
principal amount of $10,000,000 (the Notes). Capitalized terms used and
not
otherwise defined herein shall have the meanings provided in the Agreement.
This
letter is being delivered to you in satisfaction of the condition set forth
in
paragraph 3A(v) of the Agreement and with the understanding you are
purchasing
the Notes in reliance on the opinions expressed herein.
In this connection, we have examined such certificates of public
officials,
certificates of officers of the Company and copies certified to our
satisfaction of
corporate documents and records of the Company and of other papers, and have
made such other investigations, as we have deemed relevant and necessary as
a
basis for our opinion hereinafter set forth. We have relied upon such
certificates
of public officials and of officers of the Company with respect to the
accuracy of
material factual matters contained therein which were not independently
established. With respect to the opinion expressed in paragraph 3 below, we
have
also relied upon the representation made by you in paragraph 9A of the
Agreement.
Based on the foregoing, it is our opinion that:
1. The Company is a corporation duly organized and validly existing
in
good standing under the laws of the State of Delaware. The Company has the
corporate power to carry on its businesses as now being conducted.
2. The Agreement and the Notes have been duly authorized by all
requisite
corporate action and duly executed and delivered by authorized officers of
the
Company, and are valid obligations of the Company, legally binding upon and
enforceable against the Company in accordance with their respective terms,
except
as such enforceability may be limited by (a) bankruptcy, insolvency,
reorganization
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). The Notes are entitled to
the
benefits of the Note Agreement.
3. It is not necessary in connection with the offering, issuance,
sale and
delivery of the Notes under the circumstances contemplated by the Agreement
to
register the Notes under the Securities Act or to qualify an indenture in
respect of
the Notes under the Trust Indenture Act of 1939, as amended.
4. The extension, arranging and obtaining of the credit represented
by the
Notes do not result in any violation of regulation G, T or X of the Board of
Governors of the Federal Reserve System.
5. The execution and delivery of the Agreement and the Notes, the
offering,
issuance and sale of the Notes and fulfillment of and compliance with the
respective provisions of the Agreement and the Notes do not conflict with, or
result in a breach of the terms, conditions or provisions of, or constitute
a default
under, or result in any violation of, or result in the creation of any Lien
upon any
of the properties or assets of the Company pursuant to, or require any
authorization, consent, approval, exemption, or other action by or notice to
or
filing with any court, administrative or governmental body or other Person
(other
than routine filings after the date hereof with the Securities and Exchange
Commission and/or state Blue Sky authorities) pursuant to, the charter or
by-laws
of the Company, any applicable law (including any securities or Blue Sky
law),
statute, rule or regulation or (insofar as is known to us after having made
due
inquiry with respect thereto) any agreement (including, without limitation,
any
agreement listed in Schedule 8G to the Agreement), instrument, order,
judgment
or decree to which the Company is a party or otherwise subject.
6. A Virginia court or a federal court sitting in Virginia in a
diversity
action should, under conflicts of law principles observed by the courts of
Virginia,
give effect to the provisions of the Agreement and Notes providing that the
Agreement and Notes are to be governed by and construed in accordance with
the
laws of the State of New York insofar as such provisions relate to the
substantive
laws of the State of New York and to the validity, nature, interpretation and
effect
of the Agreement and Notes except (i) to the extent, if any, that federal law
applies, (ii) to the extent that procedural (as opposed to substantive) laws
are
involved or (iii) to the extent the applicable law of the State of New York
violate
a public policy of Virginia. We assume for purposes of this opinion that the
Agreement and the Notes are being delivered by the Company in New York, that
the Agreement is being delivered by Prudential in New York and that all
payments
of principal and interest on the Notes contemplated by the Agreement will be
made in New York.
This opinion is limited to matters governed by the federal laws of the
United
States of America, the general corporation laws of the State of Delaware and
the
laws of the State of New York and the Commonwealth of Virginia.
This opinion may be relied upon by King & Spalding and any Transferee.
Very truly yours,
EXHIBIT D-2
[FORM OF OPINION OF COMPANY'S COUNSEL]
[Letterhead of ▇▇▇▇▇▇▇ ▇▇▇▇▇ Battle & ▇▇▇▇▇▇, L.L.P. ]
[Closing Day]
[Name(s) and address(es) of
purchaser(s)]
Ladies and Gentlemen:
We have acted as counsel for ▇▇▇▇▇▇▇ Furniture Company, Inc. (the
Company) in connection with the Note Purchase and Private Shelf Agreement,
dated as of June 29, 1995 (the Agreement) between the Company, on the one
hand, and The Prudential Insurance Company of America and each Prudential
Affiliate which becomes a party thereto, on the other hand, pursuant to which
the
Company has issued to you today Senior Series ___ Notes of the Company in the
aggregate principal amount of $___________ (the Notes). Capitalized terms
used and not otherwise defined herein shall have the meanings provided in the
Agreement. This letter is being delivered to you in satisfaction of the
condition
set forth in paragraph 3A(v) of the Agreement and with the understanding that
you
are purchasing the Notes in reliance on the opinions expressed herein.
In this connection, we have examined such certificates of public
officials,
certificates of officers of the Company and copies certified to our
satisfaction of
corporate documents and records of the Company and of other papers, and have
made such other investigations, as we have deemed relevant and necessary as
a
basis for our opinion hereinafter set forth. We have relied upon such
certificates
of public officials and of officers of the Company with respect to the
accuracy of
material factual matters contained therein which were not independently
established. With respect to the opinion expressed in paragraph 3 below, we
have
also relied upon the representation made by you in paragraph 9A of the
Agreement.
Based on the foregoing, it is our opinion that:
1. The Company is a corporation duly organized and validly existing
in
good standing under the laws of the State of Delaware. The Company has the
corporate power to carry on its businesses as now being conducted.
2. The Agreement and the Notes have been duly authorized by all
requisite
corporate action and duly executed and delivered by authorized officers of
the
Company, and are valid obligations of the Company, legally binding upon and
enforceable against the Company in accordance with their respective terms,
except
as such enforceability may be limited by (a) bankruptcy, insolvency,
reorganization
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). The Notes are entitled to
the
benefits of the Note Agreement.
3. It is not necessary in connection with the offering, issuance,
sale and
delivery of the Notes under the circumstances contemplated by the Agreement
to
register the Notes under the Securities Act or to qualify an indenture in
respect of
the Notes under the Trust Indenture Act of 1939, as amended.
4. The extension, arranging and obtaining of the credit represented
by the
Notes do not result in any violation of regulation G, T or X of the Board of
Governors of the Federal Reserve System.
5. The execution and delivery of the Agreement and the Notes, the
offering,
issuance and sale of the Notes and fulfillment of and compliance with the
respective provisions of the Agreement and the Notes do not conflict with, or
result in a breach of the terms, conditions or provisions of, or constitute
a default
under, or result in any violation of, or result in the creation of any Lien
upon any
of the properties or assets of the Company pursuant to, or require any
authorization, consent, approval, exemption, or other action by or notice to
or
filing with any court, administrative or governmental body or other Person
(other
than routine filings after the date hereof with the Securities and Exchange
Commission and/or state Blue Sky authorities) pursuant to, the charter or
by-laws
of the Company, any applicable law (including any securities or Blue Sky
law),
statute, rule or regulation or (insofar as is known to us after having made
due
inquiry with respect thereto) any agreement (including, without limitation,
any
agreement listed in Schedule 8G to the Agreement), instrument, order,
judgment
or decree to which the Company is a party or otherwise subject.
6. A Virginia court or a federal court sitting in Virginia in a
diversity
action should, under conflicts of law principles observed by the courts of
Virginia,
give effect to the provisions of the Agreement and Notes providing that the
Agreement and Notes are to be governed by and construed in accordance with
the
laws of the State of New York insofar as such provisions relate to the
substantive
laws of the State of New York and to the validity, nature, interpretation and
effect
of the Agreement and Notes except (i) to the extent, if any, that federal law
applies, (ii) to the extent that procedural (as opposed to substantive) laws
are
involved or (iii) to the extent the applicable law of the State of New York
violate
a public policy of Virginia. We assume for purposes of this opinion that the
Agreement and the Notes are being delivered by the Company in New York, that
the Agreement is being delivered by Prudential in New York and that all
payments
of principal and interest on the Notes contemplated by the Agreement will be
made in New York.
This opinion is limited to matters governed by the federal laws of the
United
States of America, the general corporation laws of the State of Delaware and
the
laws of the State of New York and the Commonwealth of Virginia.
This opinion may be relied upon by King & Spalding and any Transferee.
Very truly yours,
INFORMATION SCHEDULE
Authorized Officers for Prudential
The Prudential Insurance Company of America
c/o Prudential Capital Group
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