EXHIBIT 4-D-7
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OTTER TAIL CORPORATION
$90,000,000 6.63% Senior Notes due December 1, 2011
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NOTE PURCHASE AGREEMENT
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Dated as of December 1, 2001
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TABLE OF CONTENTS
SECTION HEADING PAGE
SECTION 1. AUTHORIZATION OF NOTES.................................................................1
SECTION 2. SALE AND PURCHASE OF NOTES.............................................................1
SECTION 3. CLOSING................................................................................2
SECTION 4. CONDITIONS TO CLOSING..................................................................2
Section 4.1. Representations and Warranties.........................................................2
Section 4.2. Performance; No Default................................................................2
Section 4.3. Compliance Certificates................................................................2
Section 4.4. Opinions of Counsel....................................................................3
Section 4.5. Purchase Permitted by Applicable Law, etc..............................................3
Section 4.6. Sale of Other Notes....................................................................3
Section 4.7. Payment of Special Counsel Fees........................................................3
Section 4.8. Private Placement Number...............................................................3
Section 4.9. Changes in Corporate Structure.........................................................3
Section 4.10. Guaranty Agreement.....................................................................4
Section 4.11. Funding Instruction Letter.............................................................4
Section 4.12. Proceedings and Documents..............................................................4
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY..........................................4
Section 5.1. Organization; Power and Authority......................................................4
Section 5.2. Authorization, etc.....................................................................4
Section 5.3. Disclosure.............................................................................4
Section 5.4. Organization and Ownership of Shares of Subsidiaries...................................5
Section 5.5. Financial Statements...................................................................6
Section 5.6. Compliance with Laws, Other Instruments, etc...........................................6
Section 5.7. Governmental Authorizations, etc.......................................................6
Section 5.8. Litigation; Observance of Statutes and Orders..........................................6
Section 5.9. Taxes..................................................................................7
Section 5.10. Title to Property; Leases..............................................................7
Section 5.11. Licenses, Permits, etc.................................................................7
Section 5.12. Compliance with ERISA..................................................................7
Section 5.13. Private Offering by the Company........................................................8
Section 5.14. Use of Proceeds; Margin Regulations....................................................8
Section 5.15. Existing Indebtedness..................................................................8
Section 5.16. Foreign Assets Control Regulations, etc................................................9
Section 5.17. Status under Certain Statutes..........................................................9
Section 5.18. Environmental Matters..................................................................9
SECTION 6. REPRESENTATIONS OF THE PURCHASER......................................................10
Section 6.1. Purchase for Investment...............................................................10
Section 6.2. Source of Funds.......................................................................10
SECTION 7. INFORMATION AS TO COMPANY.............................................................11
Section 7.1. Financial and Business Information....................................................11
Section 7.2. Officer's Certificate.................................................................13
Section 7.3. Inspection............................................................................14
SECTION 8. PREPAYMENT OF THE NOTES...............................................................14
Section 8.1. Required Prepayments..................................................................14
Section 8.2. Optional Prepayments with Make-Whole Amount...........................................14
Section 8.3. Investment Grade Put Event............................................................15
Section 8.4. Allocation of Partial Prepayments.....................................................16
Section 8.5. Maturity; Surrender, etc..............................................................16
Section 8.6. Purchase of Notes.....................................................................16
Section 8.7. Make-Whole Amount.....................................................................17
SECTION 9. AFFIRMATIVE COVENANTS.................................................................18
Section 9.1. Compliance with Law...................................................................18
Section 9.2. Insurance.............................................................................18
Section 9.3. Maintenance of Properties.............................................................18
Section 9.4. Payment of Taxes......................................................................19
Section 9.5. Corporate Existence, etc..............................................................19
Section 9.6. Note Exchange Upon Issuance of First Mortgage Bonds...................................19
Section 9.7. Private Rating........................................................................20
Section 9.8. Guaranty by Subsidiaries..............................................................20
Section 9.10. Additional Lenders under Intercreditor Agreement......................................21
Section 9.11. New Noteholders under Intercreditor Agreement.........................................22
Section 9.12. Release of Guaranty Agreement.........................................................22
SECTION 10. NEGATIVE COVENANTS....................................................................22
Section 10.1. Limitation on Funded Debt.............................................................22
Section 10.2. Interest Charges Coverage Ratio.......................................................22
Section 10.3. Limitation on Liens...................................................................22
Section 10.4. Merger, Consolidation, Etc............................................................24
Section 10.5. Sale of Assets, Etc...................................................................25
Section 10.6. Transactions with Affiliates..........................................................26
Section 10.7. Benefit of More Restrictive Covenants or More Favorable Terms.........................26
SECTION 11. EVENTS OF DEFAULT.....................................................................27
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SECTION 12. REMEDIES ON DEFAULT, ETC..............................................................29
Section 12.1. Acceleration..........................................................................29
Section 12.2. Other Remedies........................................................................29
Section 12.3. Rescission............................................................................30
Section 12.4. No Waivers or Election of Remedies, Expenses, etc.....................................30
SECTION 13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.........................................30
Section 13.1. Registration of Notes.................................................................30
Section 13.2. Transfer and Exchange of Notes........................................................30
Section 13.3. Replacement of Notes..................................................................31
SECTION 14. PAYMENTS ON NOTES.....................................................................31
Section 14.1. Place of Payment......................................................................31
Section 14.2. Home Office Payment...................................................................31
SECTION 15. EXPENSES, ETC.........................................................................32
Section 15.1. Transaction Expenses..................................................................32
Section 15.2. Survival..............................................................................32
SECTION 16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT..........................33
SECTION 17. AMENDMENT AND WAIVER..................................................................33
Section 17.1. Requirements..........................................................................33
Section 17.2. Solicitation of Holders of Notes......................................................33
Section 17.3. Binding Effect, etc...................................................................34
Section 17.4. Notes Held by Company, etc............................................................34
SECTION 18. NOTICES...............................................................................34
SECTION 19. REPRODUCTION OF DOCUMENTS.............................................................35
SECTION 20. CONFIDENTIAL INFORMATION..............................................................35
SECTION 21. SUBSTITUTION OF PURCHASER.............................................................36
SECTION 22. MISCELLANEOUS.........................................................................36
Section 22.1. Successors and Assigns................................................................36
Section 22.2. Payments Due on Non-Business Days.....................................................36
Section 22.3. Severability..........................................................................36
Section 22.4. Construction..........................................................................37
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Section 22.5. Counterparts..........................................................................37
Section 22.6. Submission to Jurisdiction............................................................37
Section 22.7. Governing Law.........................................................................37
SCHEDULE A -- INFORMATION RELATING TO PURCHASERS
SCHEDULE B -- DEFINED TERMS
SCHEDULE 4.9 -- Changes in Corporate Structure
SCHEDULE 5.3 -- Disclosure Materials
SCHEDULE 5.4 -- Subsidiaries of the Company and Ownership of Subsidiary Stock
SCHEDULE 5.5 -- Financial Statements
SCHEDULE 5.8 -- Certain Litigation
SCHEDULE 5.11 -- Patents, etc.
SCHEDULE 5.14 -- Use of Proceeds
SCHEDULE 5.15 -- Existing Indebtedness
EXHIBIT 1 -- Form of 6.63% Senior Note, due December 1, 2011
EXHIBIT 2 -- Form of Guaranty Agreement
EXHIBIT 3 -- Form of Intercreditor Agreement
EXHIBIT 4.4(a) -- Form of Opinion of Counsel for the Company
EXHIBIT 4.4(b) -- Form of Opinion of General Counsel of the Company
EXHIBIT 4.4(c) -- Form of Opinion of Special Counsel for the Purchasers
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OTTER TAIL CORPORATION
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇.▇.
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
$90,000,000 6.63% Senior Notes, due December 1, 2011
Dated as of
December 1, 2001
TO THE PURCHASERS LISTED IN
THE ATTACHED SCHEDULE A:
Ladies and Gentlemen:
OTTER TAIL CORPORATION, a Minnesota corporation (the "Company"), agrees
with the Purchasers named on Schedule A (the "Purchasers") as follows:
SECTION 1. AUTHORIZATION OF NOTES.
The Company will authorize the issue and sale of $90,000,000 aggregate
principal amount of its 6.63% Senior Notes due December 1, 2011 (the "Notes")
such term to include any such notes issued in substitution therefor pursuant to
Section 13 of this Agreement). The Notes shall be substantially in the form set
out in Exhibit 1 with such changes therefrom, if any, as may be approved by the
Purchasers and the Company. Certain capitalized terms used in this Agreement are
defined in Schedule B; references to a "Schedule" or an "Exhibit" are, unless
otherwise specified, to a Schedule or an Exhibit attached to this Agreement.
The payment by the Company of all amounts due with respect to the Notes
and the performance by the Company of its obligations under this Agreement
described in Section 2 below will be unconditionally guaranteed by all
Subsidiaries designated on Schedule 5.4 as Guarantors (the "Subsidiary
Guarantors") under the Guaranty Agreement dated as of December 1, 2001 (the
"Guaranty Agreement") from such Subsidiary Guarantors, which Guaranty Agreement
shall be in the form attached hereto as Exhibit 2.
SECTION 2. SALE AND PURCHASE OF NOTES.
Subject to the terms and conditions of this Agreement, the Company will
issue and sell to each Purchaser and each Purchaser will purchase from the
Company, at the Closing provided for in Section 3, Notes in the principal amount
specified opposite such Purchaser's name in Schedule A at the purchase price of
100% of the principal amount thereof. The obligation of each Purchaser hereunder
is several and not joint, and no Purchaser shall have any liability to any
Person for the performance or nonperformance by any other Purchaser.
Otter Tail Corporation Note Purchase Agreement
SECTION 3. CLOSING.
The sale and purchase of the Notes to be purchased by the Purchasers
shall occur at the offices of ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, at 10:00 A.M. Chicago time, at a closing (the
"Closing") on December 27, 2001 or on such other Business Day thereafter on or
prior to December 28, 2001 as may be agreed upon by the Company and the
Purchasers. At the Closing the Company will deliver to each Purchaser the Notes
to be purchased by such Purchaser in the form of a single Note (or such greater
number of Notes in denominations of at least $100,000 as such Purchaser may
request) dated the date of the Closing and registered in such Purchaser's name
(or in the name of such Purchaser's nominee), against delivery by such Purchaser
to the Company or its order of immediately available funds in the amount of the
purchase price therefor by wire transfer of immediately available funds for the
account of the Company to account number 163095559403 at U.S. Bank N.A., Fargo,
North Dakota, ABA No. ▇▇▇▇▇▇▇▇▇. If at the Closing the Company shall fail to
tender such Notes to a Purchaser as provided above in this Section 3, or any of
the conditions specified in Section 4 shall not have been fulfilled to a
Purchaser's satisfaction, such Purchaser shall, at such Purchaser's election, be
relieved of all further obligations under this Agreement, without thereby
waiving any rights such Purchaser may have by reason of such failure or such
nonfulfillment.
SECTION 4. CONDITIONS TO CLOSING.
Each Purchaser's obligation to purchase and pay for the Notes to be
sold to such Purchaser at the Closing is subject to the fulfillment to such
Purchaser's satisfaction, prior to or at the Closing, of the following
conditions:
Section 4.1. Representations and Warranties. The representations and
warranties of the Company in this Agreement shall be correct when made and at
the time of the Closing.
Section 4.2. Performance; No Default. (a) The Company shall have
performed and complied with all agreements and conditions contained in this
Agreement required to be performed or complied with by it prior to or at the
Closing, and after giving effect to the issue and sale of the Notes (and the
application of the proceeds thereof as contemplated by Schedule 5.14), no
Default or Event of Default shall have occurred and be continuing. Neither the
Company nor any Subsidiary shall have entered into any transaction since the
date of the Memorandum that would have been prohibited by Section 10 hereof had
such Sections applied since such date.
(b) The Subsidiary Guarantors shall have performed all of their
obligations under the Guaranty Agreement which are to be performed on or prior
to the Closing.
Section 4.3. Compliance Certificates.
(a) Officer's Certificate. The Company shall have delivered to such
Purchaser an Officer's Certificate, dated the date of the Closing, certifying
that the conditions specified in Sections 4.1, 4.2 and 4.9 have been fulfilled.
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Otter Tail Corporation Note Purchase Agreement
(b) Secretary's Certificate. The Company shall have delivered to
such Purchaser a certificate certifying as to the resolutions attached thereto
and other corporate proceedings relating to the authorization, execution and
delivery of (i) the Notes and the Agreements by the Company and (ii) the
Guaranty Agreement by the Subsidiary Guarantors.
Section 4.4. Opinions of Counsel. Such Purchaser shall have received
opinions in form and substance satisfactory to such Purchaser, dated the date of
the Closing (a) from ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, counsel for the Company, covering the
matters set forth in Exhibit 4.4(a) and covering such other matters incident to
the transactions contemplated hereby as such Purchaser or such Purchaser's
counsel may reasonably request, (b) from the General Counsel of the Company
covering the matters set forth in Exhibit 4.4(b) and covering such other matters
incident to such transactions as such Purchaser or such Purchaser's counsel may
reasonably request and (c) from ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇, the Purchasers' special
counsel in connection with such transactions, substantially in the form set
forth in Exhibit 4.4(c) and covering such other matters incident to such
transactions as such Purchaser or such Purchaser's counsel may reasonably
request.
Section 4.5. Purchase Permitted by Applicable Law, etc. On the date of
the Closing each purchase of Notes shall (i) be permitted by the laws and
regulations of each jurisdiction to which such Purchaser is subject, without
recourse to provisions (such as Section 1405(a)(8) of the New York Insurance
Law) permitting limited investments by insurance companies without restriction
as to the character of the particular investment, (ii) not violate any
applicable law or regulation (including, without limitation, Regulation T, U or
X of the Board of Governors of the Federal Reserve System) and (iii) not subject
such Purchaser to any tax, penalty or liability under or pursuant to any
applicable law or regulation, which law or regulation was not in effect on the
date hereof. If requested by any Purchaser, such Purchaser shall have received
an Officer's Certificate certifying as to such matters of fact as such Purchaser
may reasonably specify to enable such Purchaser to determine whether such
purchase is so permitted.
Section 4.6. Sale of Other Notes. The Company shall have consummated
the sale of the entire principal amount of the Notes scheduled to be sold at the
Closing as specified in Schedule A.
Section 4.7. Payment of Special Counsel Fees. Without limiting the
provisions of Section 15.1, the Company shall have paid on or before the Closing
the reasonable fees, charges and disbursements of the Purchasers' special
counsel referred to in Section 4.4 to the extent reflected in a statement of
such counsel rendered to the Company at least two Business Days prior to the
Closing.
Section 4.8. Private Placement Number. A Private Placement Number
issued by Standard & Poor's CUSIP Service Bureau (in cooperation with the
Securities Valuation Office of the National Association of Insurance
Commissioners) shall have been obtained for the Notes.
Section 4.9. Changes in Corporate Structure. Except as specified in
Schedule 4.9, the Company shall not have changed its jurisdiction of
incorporation or been a party to any merger
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Otter Tail Corporation Note Purchase Agreement
or consolidation and shall not have succeeded to all or any substantial part of
the liabilities of any other entity, at any time following the date of the most
recent financial statements referred to in Schedule 5.5.
Section 4.10. Guaranty Agreement. The Guaranty Agreement shall have been
duly authorized, executed and delivered by each Subsidiary Guarantor, shall
constitute the legal, valid and binding contract and agreement of each of the
Subsidiary Guarantors and shall be enforceable against each Subsidiary Guarantor
in accordance with its terms.
Section 4.11. Funding Instruction Letter. Each Purchaser shall have
received at least three Business Days prior to the Closing Date a letter from
the Company on its letterhead setting forth the wire transfer instructions for
the payment by such Purchaser of the purchase price of the Notes to be purchased
by such Purchaser.
Section 4.12. Proceedings and Documents. All corporate and other
proceedings in connection with the transactions contemplated by this Agreement
and all documents and instruments incident to such transactions shall be
satisfactory to such Purchaser and the Purchasers' special counsel, and such
Purchaser and the Purchasers' special counsel shall have received all such
counterpart originals or certified or other copies of such documents as such
Purchaser or they may reasonably request.
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to each Purchaser that:
Section 5.1. Organization; Power and Authority. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of its jurisdiction of incorporation, and is duly qualified as a foreign
corporation and is in good standing in each jurisdiction in which such
qualification is required by law, other than those jurisdictions as to which the
failure to be so qualified or in good standing would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect. The Company
has the corporate power and authority to own or hold under lease the properties
it purports to own or hold under lease, to transact the business it transacts,
to execute and deliver this Agreement and the Notes and to perform the
provisions hereof and thereof.
Section 5.2. Authorization, etc. This Agreement and the Notes have been
duly authorized by all necessary corporate action on the part of the Company,
and this Agreement constitutes, and upon execution and delivery thereof each
Note will constitute, a legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by (i) applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally and (ii) general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
Section 5.3. Disclosure. The Company, through its agent, ▇. ▇. ▇▇▇▇▇▇▇
& Sons, has delivered to each Purchaser a copy of a Private Placement
Memorandum, dated November, ▇▇▇▇
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▇▇▇▇▇ Tail Corporation Note Purchase Agreement
(the "Memorandum"), relating to the transactions contemplated hereby. This
Agreement, the Guaranty Agreement, the Memorandum, the documents, certificates
or other writings identified in Schedule 5.3 and the financial statements listed
in Schedule 5.5, taken as a whole, do not contain any untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein not misleading in light of the circumstances under which they
were made. Except as disclosed in the Memorandum or as expressly described in
Schedule 5.3 or in one of the documents, certificates or other writings
identified therein or in the financial statements listed on Schedule 5.5, since
December 31, 2000, there has been no change in the financial condition,
operations, business or properties of the Company or any of its Subsidiaries
except changes that individually or in the aggregate would not reasonably be
expected to have a Material Adverse Effect.
Section 5.4. Organization and Ownership of Shares of Subsidiaries. (a)
Schedule 5.4 is (except as noted therein) a complete and correct list of the
Company's Subsidiaries, showing, as to each Subsidiary, the correct name
thereof, the jurisdiction of its organization, and the percentage of shares of
each class of its capital stock or similar equity interests outstanding owned by
the Company and each other Subsidiary.
(b) All of the outstanding shares of capital stock or similar equity
interests of each Subsidiary shown in Schedule 5.4 as being owned by the Company
and its Subsidiaries have been validly issued, are fully paid and nonassessable
and are owned by the Company or another Subsidiary free and clear of any Lien
(except as otherwise disclosed in Schedule 5.4).
(c) Each Subsidiary identified in Schedule 5.4 is a corporation or
other legal entity duly organized, validly existing and in good standing under
the laws of its jurisdiction of organization, and is duly qualified as a foreign
corporation or other legal entity and is in good standing in each jurisdiction
in which such qualification is required by law, other than those jurisdictions
as to which the failure to be so qualified or in good standing would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. Each such Subsidiary has the corporate or other power and
authority to own or hold under lease the properties it purports to own or hold
under lease and to transact the business it transacts and each Subsidiary
Guarantor has the Corporate or other power and authority to execute and deliver
the Guaranty Agreement and perform its obligations thereunder.
(d) The Guaranty Agreement has been duly authorized by all necessary
action on the part of each Subsidiary Guarantor and the Guaranty Agreement
constitutes a legal, valid and binding obligation of such Subsidiary Guarantor
enforceable against such Subsidiary Guarantor in accordance with its terms,
except as such enforceability may be limited by (a) applicable bankruptcy,
insolvency, fraudulent conveyance 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).
(e) No Subsidiary is a party to, or otherwise subject to, any legal
restriction or any agreement (other than this Agreement, the agreements listed
on Schedule 5.4 and customary limitations imposed by corporate law statutes)
restricting the ability of such Subsidiary to pay dividends out of profits or
make any other similar distributions of profits to the Company or any
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Otter Tail Corporation Note Purchase Agreement
of its Subsidiaries that owns outstanding shares of capital stock or similar
equity interests of such Subsidiary.
Section 5.5. Financial Statements. The Company has delivered to each
Purchaser copies of the consolidated financial statements of the Company and its
Subsidiaries listed on Schedule 5.5. All of said consolidated financial
statements (including in each case the related schedules and notes) fairly
present in all material respects the consolidated financial position of the
Company and its Subsidiaries as of the respective dates specified in such
Schedule and the consolidated results of their operations and cash flows for the
respective periods so specified and have been prepared in accordance with GAAP
consistently applied throughout the periods involved except as set forth in the
notes thereto (subject, in the case of any interim consolidated financial
statements, to normal year-end adjustments).
Section 5.6. Compliance with Laws, Other Instruments, etc. Neither the
execution, delivery and performance by the Company of this Agreement and the
Notes nor the execution, delivery and performance by any Subsidiary Guarantor of
the Guaranty Agreement will (i) contravene, result in any breach of, or
constitute a default under, or result in the creation of any Lien in respect of
any property of the Company or any Subsidiary Guarantor under, any indenture,
mortgage, deed of trust, loan, purchase or credit agreement, lease, corporate
charter or by-laws, or any other Material agreement or instrument to which the
Company, any Subsidiary Guarantor is bound or by which the Company or any
Subsidiary Guarantor or any of their respective properties may be bound or
affected, (ii) conflict with or result in a breach of any of the terms,
conditions or provisions of any order, judgment, decree, or ruling of any court,
arbitrator or Governmental Authority applicable to the Company or any Subsidiary
Guarantor or (iii) violate any provision of any statute or other rule or
regulation of any Governmental Authority applicable to the Company or any
Subsidiary Guarantor.
Section 5.7. Governmental Authorizations, etc. No prior consent,
approval or authorization of, or registration, filing or declaration with, any
Governmental Authority is required in connection with the execution, delivery or
performance by the Company of this Agreement or the Notes or by the Subsidiary
Guarantors of the Guaranty Agreement which has not been obtained or made.
Section 5.8. Litigation; Observance of Statutes and Orders. (a) Except
as disclosed in Schedule 5.8, there are no actions, suits or proceedings pending
or, to the knowledge of the Company, threatened against or affecting the Company
or any Subsidiary or any property of the Company or any Subsidiary in any court
or before any arbitrator of any kind or before or by any Governmental Authority
that, individually or in the aggregate, would reasonably be expected to have a
Material Adverse Effect.
(b) Neither the Company nor any Subsidiary is in default under any
order, judgment, decree or ruling of any court, arbitrator or Governmental
Authority or is in violation of any applicable law, ordinance, rule or
regulation (including without limitation Environmental Laws) of any Governmental
Authority, which default or violation, individually or in the aggregate, would
reasonably be expected to have a Material Adverse Effect.
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Otter Tail Corporation Note Purchase Agreement
Section 5.9. Taxes. The Company and its Subsidiaries have filed all
consolidated income tax returns that are required to have been filed in any
jurisdiction, and have paid all taxes shown to be due and payable on such
returns and all other taxes and assessments payable by them, to the extent such
taxes and assessments have become due and payable and before they have become
delinquent, except for any taxes and assessments (i) the amount of which is not
individually or in the aggregate Material or (ii) the amount, applicability or
validity of which is currently being contested in good faith by appropriate
proceedings and with respect to which the Company or a Subsidiary, as the case
may be, has established adequate reserves in accordance with GAAP. The
consolidated Federal income tax returns of the Company have been audited by the
Internal Revenue Service for all fiscal years up to and including the fiscal
year ended December 31, 1996.
Section 5.10. Title to Property; Leases. The Company and its
Subsidiaries have good and sufficient title to their respective Material
properties, including all such properties reflected in the most recent audited
balance sheet referred to in Section 5.5 or purported to have been acquired by
the Company or any Subsidiary after said date (except as sold or otherwise
disposed of in the ordinary course of business), in each case free and clear of
Liens prohibited by this Agreement, except for those defects in title and Liens
that, individually or in the aggregate, would not have a Material Adverse
Effect. All Material leases are valid and subsisting and are in full force and
effect in all material respects.
Section 5.11. Licenses, Permits, etc. Except as disclosed in Schedule
5.11, the Company and its Subsidiaries own or possess all licenses, permits,
franchises, authorizations, patents, copyrights, service marks, trademarks and
trade names, or rights thereto, that are Material, without known conflict with
the rights of others, except for those conflicts that, individually or in the
aggregate, would not have a Material Adverse Effect.
Section 5.12. Compliance with ERISA. (a) The Company and each ERISA
Affiliate have operated and administered each Plan in compliance with all
applicable laws except for such instances of noncompliance as have not resulted
in and could not reasonably be expected to result in a Material Adverse Effect.
Neither the Company nor any ERISA Affiliate has incurred any liability pursuant
to Title I or IV of ERISA or the penalty or excise tax provisions of the Code
relating to employee benefit plans (as defined in section 3 of ERISA), and no
event, transaction or condition has occurred or exists that would reasonably be
expected to result in the incurrence of any such liability by the Company or any
ERISA Affiliate, or in the imposition of any Lien on any of the rights,
properties or assets of the Company or any ERISA Affiliate, in either case
pursuant to Title I or IV of ERISA or to such penalty or excise tax provisions
or to section 401(a)(29) or 412 of the Code, other than such liabilities or
Liens as would not be individually or in the aggregate Material.
(b) The present value of the aggregate benefit liabilities under each
of the Plans (other than Multiemployer Plans), determined as of the end of such
Plan's most recently ended plan year on the basis of the actuarial assumptions
specified for funding purposes in such Plan's most recent actuarial valuation
report, did not exceed the aggregate current value of the assets of such Plan
allocable to such benefit liabilities. The term "benefit liabilities" has the
meaning specified
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Otter Tail Corporation Note Purchase Agreement
in section 4001 of ERISA and the terms "current value" and "present value" have
the meanings specified in section 3 of ERISA.
(c) The Company and its ERISA Affiliates have not incurred withdrawal
liabilities (and are not subject to contingent withdrawal liabilities) under
section 4201 or 4204 of ERISA in respect of Multiemployer Plans that
individually or in the aggregate are Material.
(d) The expected post-retirement benefit obligation (determined as of
the last day of the Company's most recently ended fiscal year in accordance with
Financial Accounting Standards Board Statement No. 106, without regard to
liabilities attributable to continuation coverage mandated by section 4980B of
the Code) of the Company and its Subsidiaries is not Material.
(e) The execution and delivery of this Agreement and the issuance and
sale of the Notes hereunder will not involve any transaction that is subject to
the prohibitions of section 406 of ERISA or in connection with which a tax could
be imposed pursuant to section 4975(c)(1)(A)-(D) of the Code. The representation
by the Company in the first sentence of this Section 5.12(e) is made in reliance
upon and subject to the accuracy of each Purchaser's representation in Section
6.2 as to the sources of the funds used to pay the purchase price of the Notes
to be purchased by such Purchaser.
Section 5.13. Private Offering by the Company. Neither the Company nor
anyone acting on its behalf has offered the Notes or any similar securities for
sale to, or solicited any offer to buy any of the same from, or otherwise
approached or negotiated in respect thereof with, any Person other than the
Purchasers and not more than 50 other Institutional Investors, each of which has
been offered the Notes at a private sale for investment. Neither the Company nor
anyone acting on its behalf has taken, or will take, any action that would
subject the issuance or sale of the Notes to the registration requirements of
Section 5 of the Securities Act.
Section 5.14. Use of Proceeds; Margin Regulations. The Company will
apply the proceeds of the sale of the Notes as set forth in Schedule 5.14. No
part of the proceeds from the sale of the Notes hereunder will be used, directly
or indirectly, for the purpose of buying or carrying any margin stock within the
meaning of Regulation U of the Board of Governors of the Federal Reserve System
(12 CFR 207), or for the purpose of buying or carrying or trading in any
securities under such circumstances as to involve the Company in a violation of
Regulation X of said Board (12 CFR 224) or to involve any broker or dealer in a
violation of Regulation T of said Board (12 CFR 220). Margin stock does not
constitute more than 10% of the value of the consolidated assets of the Company
and its Subsidiaries and the Company does not have any present intention that
margin stock will constitute more than 10% of the value of such assets. As used
in this Section, the terms "margin stock" and "purpose of buying or carrying"
shall have the meanings assigned to them in said Regulation U.
Section 5.15. Existing Indebtedness. Schedule 5.15 sets forth a complete
and correct list of all outstanding Indebtedness of the Company and its
Subsidiaries as of September 30, 2001, since which date there has been no
Material change in the amounts, interest rates, sinking funds, installment
payments or maturities of the Indebtedness of the Company or its Subsidiaries.
Neither the Company nor any Subsidiary is in default and no waiver of default is
currently in
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Otter Tail Corporation Note Purchase Agreement
effect, in the payment of any principal or interest on any Indebtedness of the
Company or such Subsidiary and no event or condition exists with respect to any
Indebtedness of the Company or any Subsidiary the outstanding principal amount
of which exceeds $1,000,000 that would permit (or that with notice or the lapse
of time, or both, would permit) one or more Persons to cause such Indebtedness
to become due and payable before its stated maturity or before its regularly
scheduled dates of payment.
Section 5.16. Foreign Assets Control Regulations, etc. Use of the
proceeds of this offering by the Company will not violate the Trading with the
Enemy Act, as amended, or any of the foreign assets control regulations of the
United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or
any enabling legislation or executive order relating thereto.
Section 5.17. Status under Certain Statutes. Neither the Company nor
any Subsidiary is an "investment company" registered or required to be
registered under the Investment Company Act of 1940, as amended, or is subject
to regulation under the Public Utility Holding Company Act of 1935, as amended.
Section 5.18. Environmental Matters. Neither the Company nor any
Subsidiary has knowledge of any claim or has received any notice of any claim,
and no proceeding has been instituted raising any claim against the Company or
any of its Subsidiaries or any of their respective real properties now or
formerly owned, leased or operated by any of them or other assets, alleging any
damage to the environment or violation of any Environmental Laws, except, in
each case, such as could not reasonably be expected to result in a Material
Adverse Effect. Except as otherwise disclosed to the Purchasers in writing:
(a) neither the Company nor any Subsidiary has knowledge of
any facts which would give rise to any claim, public or private, of
violation of Environmental Laws or damage to the environment emanating
from, occurring on or in any way related to real properties now or
formerly owned, leased or operated by any of them or to other assets or
their use, except, in each case, such as could not reasonably be
expected to result in a Material Adverse Effect;
(b) neither the Company nor any of its Subsidiaries has
stored any Hazardous Materials on real properties now or formerly
owned, leased or operated by any of them or has disposed of any
Hazardous Materials in a manner contrary to any Environmental Laws in
each case in any manner that could reasonably be expected to result in
a Material Adverse Effect; and
(c) all buildings on all real properties now owned, leased or
operated by the Company or any of its Subsidiaries are in compliance
with applicable Environmental Laws, except where failure to comply
could not reasonably be expected to result in a Material Adverse
Effect.
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Otter Tail Corporation Note Purchase Agreement
SECTION 6. REPRESENTATIONS OF THE PURCHASER.
Section 6.1. Purchase for Investment. Each Purchaser represents that
such Purchaser is purchasing the Notes for its own account or for one or more
separate accounts maintained by such Purchaser or for the account of one or more
pension or trust funds and not with a view to the distribution thereof, provided
that the disposition of such Purchaser's property shall at all times be within
its control. Each Purchaser understands that the Notes have not been registered
under the Securities Act and may be resold only if registered pursuant to the
provisions of the Securities Act or if an exemption from registration is
available, except under circumstances where neither such registration nor such
an exemption is required by law, and that the Company is not required to
register the Notes.
Section 6.2. Source of Funds. Each Purchaser represents that at least
one of the following statements is an accurate representation as to each source
of funds (a "Source") to be used by such Purchaser to pay the purchase price of
the Notes to be purchased by such Purchaser hereunder:
(a) the Source is an "insurance company general account"
within the meaning of Department of Labor Prohibited Transaction
Exemption ("PTE") 95-60 (issued July 12, 1995) and there is no
employee benefit plan, treating as a single plan, all plans
maintained by the same employer or employee organization, with
respect to which the amount of the general account reserves and
liabilities for all contracts held by or on behalf of such plan,
exceed ten percent (10%) of the total reserves and liabilities of
such general account (exclusive of separate account liabilities)
plus surplus, as set forth in the NAIC Annual Statement filed with
such Purchaser's state of domicile; or
(b) the Source is either (i) an insurance company pooled
separate account, within the meaning of PTE 90-1 (issued January 29,
1990), or (ii) a bank collective investment fund, within the meaning
of the PTE 91-38 (issued July 12, 1991) and, except as such
Purchaser has disclosed to the Company in writing pursuant to this
paragraph (b), no employee benefit plan or group of plans maintained
by the same employer or employee organization beneficially owns more
than 10% of all assets allocated to such pooled separate account or
collective investment fund; or
(c) the Source constitutes assets of an "investment fund"
(within the meaning of Part V of the QPAM Exemption) managed by a
"qualified professional asset manager" or "QPAM" (within the meaning
of Part V of the QPAM Exemption), no employee benefit plan's assets
that are included in such investment fund, when combined with the
assets of all other employee benefit plans established or maintained
by the same employer or by an affiliate (within the meaning of
Section V(c)(1) of the QPAM Exemption) of such employer or by the
same employee organization and managed by such QPAM, exceed 20% of
the total client assets managed by such QPAM, the conditions of Part
I(c) and (g) of the QPAM Exemption are satisfied, neither the QPAM
nor a person controlling or controlled by the QPAM (applying the
definition of "control" in Section V(e) of the QPAM Exemption) owns
a 5% or more interest in the Company and (i) the identity of such
QPAM and (ii) the names of all employee benefit plans whose assets
are included in
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Otter Tail Corporation Note Purchase Agreement
such investment fund have been disclosed to the Company in writing
pursuant to this paragraph (c); or
(d) the Source is a governmental plan; or
(e) the Source is one or more employee benefit plans, or a
separate account or trust fund comprised of one or more employee
benefit plans, each of which has been identified to the Company in
writing pursuant to this paragraph (e); or
(f) the Source does not include assets of any employee
benefit plan, other than a plan exempt from the coverage of ERISA.
If any Purchaser or any subsequent transferee of the Notes indicates
that such Purchaser or such transferee are relying on any representation
contained in paragraph (b), (c) or (e) above, the Company shall deliver on the
date of Closing and on the date of any applicable transfer a certificate, which
shall either state that (i) it is neither a party in interest nor a
"disqualified person" (as defined in section 4975(e)(2) of the Internal Revenue
Code of 1986, as amended), with respect to any plan identified pursuant to
paragraphs (b) or (e) above, or (ii) with respect to any plan, identified
pursuant to paragraph (c) above, neither it nor any "affiliate" (as defined in
Section V(c) of the QPAM Exemption) has at such time, and during the immediately
preceding one year, exercised the authority to appoint or terminate said QPAM as
manager of any plan identified in writing pursuant to paragraph (c) above or to
negotiate the terms of said QPAM's management agreement on behalf of any such
identified plan. As used in this Section 6.2, the terms "employee benefit plan",
"governmental plan", "party in interest" and "separate account" shall have the
respective meanings assigned to such terms in section 3 of ERISA.
SECTION 7. INFORMATION AS TO COMPANY.
Section 7.1. Financial and Business Information. The Company shall
deliver to each holder of Notes that is an Institutional Investor:
(a) Quarterly Statements -- within 60 days after the end of
each quarterly fiscal period in each fiscal year of the Company
(other than the last quarterly fiscal period of each such fiscal
year), a copy of:
(i) a consolidated balance sheet of the Company and
its Subsidiaries as at the end of such quarter, and
(ii) consolidated statements of income, changes in
shareholders' equity and cash flows of the Company and its
Subsidiaries for such quarter and (in the case of the second
and third quarters) for the portion of the fiscal year ending
with such quarter,
setting forth in each case in comparative form the figures for the
corresponding periods in the previous fiscal year, all in reasonable
detail, prepared in accordance with GAAP applicable to quarterly
financial statements generally, and certified by a Senior Financial
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Otter Tail Corporation Note Purchase Agreement
Officer as fairly presenting, in all material respects, the
consolidated financial position of the Company and its Subsidiaries and
their results of operations and cash flows, subject to changes
resulting from year-end adjustments, provided that delivery within the
time period specified above of copies of the Company's Quarterly Report
on Form 10-Q prepared in compliance with the requirements therefor and
filed with the Securities and Exchange Commission shall be deemed to
satisfy the requirements of this Section 7.1(a);
(b) Annual Statements -- within 105 days after the end of
each fiscal year of the Company, a copy of:
(i) a consolidated balance sheet of the Company and
its Subsidiaries, as at the end of such year, and
(ii) consolidated statements of income, changes in
shareholders' equity and cash flows of the Company and its
Subsidiaries, for such year,
setting forth in each case in comparative form the figures for the
previous fiscal year, all in reasonable detail, prepared in accordance
with GAAP, and accompanied by an opinion thereon of independent
certified public accountants of recognized national standing, which
opinion shall state that such financial statements present fairly, in
all material respects, the consolidated financial position of the
Company and its Subsidiaries and their results of operations and cash
flows and have been prepared in conformity with GAAP, and that the
examination of such accountants in connection with such financial
statements has been made in accordance with generally accepted auditing
standards, and that such audit provides a reasonable basis for such
opinion in the circumstances, provided that the delivery within the
time period specified above of the Company's Annual Report on Form 10-K
for such fiscal year (together with the Company's annual report to
shareholders, if any, prepared pursuant to Rule 14a-3 under the
Exchange Act) prepared in accordance with the requirements therefor and
filed with the Securities and Exchange Commission shall be deemed to
satisfy the requirements of this Section 7.1(b);
(c) SEC and Other Reports -- promptly upon their becoming
available, one copy of (i) each financial statement, report, notice or
proxy statement sent by the Company or any Subsidiary to public
securities holders generally, and (ii) each regular or periodic report,
each registration statement that shall have become effective (without
exhibits except as expressly requested by such holder), and each final
prospectus and all amendments thereto filed by the Company or any
Subsidiary with the Securities and Exchange Commission;
(d) Notice of Default or Event of Default -- promptly, and in
any event within 15 days after a Responsible Officer becoming aware of
the existence of any Default or Event of Default, a written notice
specifying the nature and period of existence thereof and what action
the Company is taking or proposes to take with respect thereto;
(e) ERISA Matters -- promptly, and in any event within 15
days after a Responsible Officer becoming aware of any of the
following, a written notice setting
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Otter Tail Corporation Note Purchase Agreement
forth the nature thereof and the action, if any, that the Company or
an ERISA Affiliate proposes to take with respect thereto:
(i) with respect to any Plan, any reportable event,
as defined in section 4043(c) of ERISA and the regulations
thereunder, for which notice thereof has not been waived
pursuant to such regulations as in effect on the date hereof;
or
(ii) the taking by the PBGC of steps to institute, or
the threatening by the PBGC of the institution of, proceedings
under section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Plan, or the
receipt by the Company or any ERISA Affiliate of a notice from
a Multiemployer Plan that such action has been taken by the
PBGC with respect to such Multiemployer Plan; or
(iii) any event, transaction or condition that could
result in the incurrence of any liability by the Company or
any ERISA Affiliate pursuant to Title I or IV of ERISA or the
penalty or excise tax provisions of the Code relating to
employee benefit plans, or in the imposition of any Lien on
any of the rights, properties or assets of the Company or any
ERISA Affiliate pursuant to Title I or IV of ERISA or such
penalty or excise tax provisions, if such liability or Lien,
taken together with any other such liabilities or Liens then
existing, would reasonably be expected to have a Material
Adverse Effect; and
(f) Requested Information -- subject to the provisions of
Section 20, with reasonable promptness, such other data and
information relating to the business, operations, financial
condition, assets or properties of the Company or any of its
Subsidiaries or relating to the ability of the Company to perform
its obligations hereunder and under the Notes as from time to time
may be reasonably requested by any such holder of Notes.
Section 7.2. Officer's Certificate. Each set of financial statements
delivered to a holder of Notes pursuant to Section 7.1(a) or Section 7.1(b)
hereof shall be accompanied by a certificate of a Senior Financial Officer
setting forth:
(a) Covenant Compliance -- the information (including
detailed calculations) required in order to establish whether the
Company was in compliance with the requirements of Section 10.1,
10.2, 10.3 and 10.5 hereof, during the quarterly or annual period
covered by the statements then being furnished (including with
respect to each such Section, where applicable, the calculations of
the maximum or minimum amount, ratio or percentage, as the case may
be, permissible under the terms of such Sections, and the
calculation of the amount, ratio or percentage then in existence);
and
(b) Event of Default -- a statement that such officer has
reviewed the relevant terms hereof and has made, or caused to be
made, under his or her supervision, a review of the transactions and
conditions of the Company and its Subsidiaries from the
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Otter Tail Corporation Note Purchase Agreement
beginning of the quarterly or annual period covered by the
statements then being furnished to the date of the certificate and
that such review shall not have disclosed the existence during such
period of any condition or event that constitutes a Default or an
Event of Default or, if any such condition or event existed or
exists (including, without limitation, any such event or condition
resulting from the failure of the Company or any Subsidiary to
comply with any Environmental Law), specifying the nature and period
of existence thereof and what action the Company shall have taken or
proposes to take with respect thereto.
Section 7.3. Inspection. Subject to the provisions of Section 20, the
Company shall permit the representatives of each holder of Notes that is an
Institutional Investor:
(a) No Default -- if no Default or Event of Default then
exists, at the expense of such holder and upon reasonable prior
notice to the Company, to visit the principal executive office of
the Company, to discuss the affairs, finances and accounts of the
Company and its Subsidiaries with the Company's officers, and, with
the consent of the Company (which consent will not be unreasonably
withheld) to visit the other offices and properties of the Company
and each Subsidiary, all at such reasonable times and as often as
may be reasonably requested in writing; and
(b) Default -- if a Default or Event of Default then exists,
at the expense of the Company, to visit and inspect any of the
offices or properties of the Company or any Subsidiary, to examine
all their respective books of account, records, reports and other
papers, to make copies and extracts therefrom, and to discuss their
respective affairs, finances and accounts with their respective
officers and independent public accountants (and by this provision
the Company authorizes said accountants to discuss the affairs,
finances and accounts of the Company and its Subsidiaries), all at
such times and as often as may be requested.
SECTION 8. PREPAYMENT OF THE NOTES.
Section 8.1. Required Prepayments. There are no required prepayment for
the Notes.
Section 8.2. Optional Prepayments with Make-Whole Amount. The Company
may, at its option, upon notice as provided below, prepay at any time all, or
from time to time any part of, the Notes, in an amount not less than 10% of the
aggregate principal amount of the Notes then outstanding in the case of a
partial prepayment, at 100% of the principal amount so prepaid, together with
interest accrued thereon to the date of such prepayment, plus the Make-Whole
Amount determined for the prepayment date with respect to such principal amount.
The Company will give each holder of Notes written notice of each optional
prepayment under this Section 8.2 not less than 30 days and not more than 60
days prior to the date fixed for such prepayment. Each such notice shall specify
such date, the aggregate principal amount of the Notes to be prepaid on such
date, the principal amount of each Note held by such holder to be prepaid
(determined in accordance with Section 8.4), and the interest to be paid on the
prepayment date with respect to such principal amount being prepaid, and shall
be accompanied by a certificate of a Senior Financial Officer as to the
estimated Make-Whole Amount due in
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Otter Tail Corporation Note Purchase Agreement
connection with such prepayment (calculated as if the date of such notice were
the date of the prepayment), setting forth the details of such computation. Two
Business Days prior to such prepayment, the Company shall deliver to each holder
of Notes a certificate of a Senior Financial Officer specifying the calculation
of such Make-Whole Amount as of the specified prepayment date.
Section 8.3. Investment Grade Put Event. (a) In the event that an
Investment Grade Put Event shall occur, the Company will give written notice (a
"Company Notice") of such fact not more than 15 days after the Investment Grade
Put Event Date to all holders of the Notes. The Company Notice shall (i)
describe the facts and circumstances of the Investment Grade Put Event in
reasonable detail, (ii) describe the Debt of the Company then outstanding, (iii)
specify the rating, if any, accorded to Senior Debt by a Designated Rating
Agency which is below an Acceptable Rating or state that the Company has
requested a private rating pursuant to Section 9.7 and that the Designated
Rating Agency has not issued a private rating in accordance with such request
within the required time period, (iv) refer to this Section 8.3 and the right of
the holders of the Notes to require the Company to purchase their Notes on the
terms and conditions provided for herein upon the occurrence of an Investment
Grade Put Event, and (v) contain an offer by the Company to purchase all of the
outstanding Notes in full together with unpaid accrued interest to the date of
purchase and the Make-Whole Amount. Each holder of the Notes shall have the
right to accept such offer and require purchase of the Notes held by such holder
in full by written notice to the Company given within 60 days following receipt
of the Company Notice. On the date designated in such holder's notice (which
shall be not less than 15 days nor more than 30 days after the date such notice
is delivered to the Company), the Company shall purchase all Notes held by such
holder at 100% of the principal amount of such Notes, together with unpaid
accrued interest thereon to the date of purchase, and the Make-Whole Amount, if
any. Failure to respond by a holder of the Notes shall constitute an acceptance
of such offer and the date of purchase shall be the 15th Business Day following
the end of the 60 day period referred to in the preceding sentence.
(b) In the event the Company fails to give the Company Notice as
required above, each holder of Notes shall have the right to require the Company
to purchase all Notes held by such holder at 100% of the principal amount of
such Notes, together with unpaid accrued interest thereon to the date of
purchase, and the Make-Whole Amount, if any. Notice of any required purchase
pursuant to this Section 8.3(b) shall be delivered by any holder of Notes to the
Company not more than 180 days after such holder has actual knowledge of such
Investment Grade Put Event. On the date designated in such holder's notice
(which shall be not less than 15 days after the date such notice is delivered to
the Company), the Company shall purchase all Notes held by such holder at 100%
of the principal amount of such Notes, together with unpaid accrued interest
thereon to the date of purchase, and the Make-Whole Amount, if any. If the
holder of any Note gives any notice pursuant to this Section 8.3(b) the Company
will give a Company Notice within three business days of receipt of such notice
to all holders of the Notes.
"Investment Grade Put Event" shall mean, and occur on, the first date
on which either of the Designated Rating Agencies rate Senior Debt below an
Acceptable Rating. If an Investment Grade Put Event Date shall have occurred and
subsequent to such Investment Grade Put Event Date both Designated Rating
Agencies shall rate Senior Debt an Acceptable Rating and
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Otter Tail Corporation Note Purchase Agreement
thereafter an Investment Grade Put Event shall occur, then a new Investment
Grade Put Event Date shall occur under this Agreement and the Company's
obligations under this Section 8.3 shall remain binding and operative. If at any
time the Company shall be requested to obtain a private rating of the Notes in
accordance with Section 9.7 and within 70 days of such request the Notes shall
not have been rated by the Designated Rating Agency or Agencies from whom such
rating was sought, then an Investment Grade Put Event shall be deemed to have
occurred unless Senior Debt shall then be rated an Acceptable Rating.
"Investment Grade Put Event Date" shall mean the first date upon which
an Investment Grade Put Event shall have occurred.
"Senior Debt" shall mean either (i) the Notes or (ii) senior unsecured
Debt of the Company which does not have the benefit of the credit support of any
Person other than the Company and which shall be outstanding in an aggregate
unpaid principal amount of not less than $10,000,000.
(c) The obligation of the Company to give the notices specified in this
Section 8.3 shall remain in effect so long as any Notes remain outstanding.
Section 8.4. Allocation of Partial Prepayments. In the case of each
partial prepayment of the Notes, the principal amount of the Notes to be prepaid
shall be allocated among all of the Notes at the time outstanding in proportion,
as nearly as practicable, to the respective unpaid principal amounts thereof.
Section 8.5. Maturity; Surrender, etc. In the case of each prepayment
of Notes pursuant to this Section 8, the principal amount of each Note to be
prepaid shall mature and become due and payable on the date fixed for such
prepayment, together with interest on such principal amount accrued to such date
and the applicable Make-Whole Amount, if any. From and after such date, unless
the Company shall fail to pay such principal amount when so due and payable,
together with the interest and Make-Whole Amount, if any, as aforesaid, interest
on such principal amount shall cease to accrue. Any Note paid or prepaid in full
shall be surrendered to the Company and cancelled and shall not be reissued, and
no Note shall be issued in lieu of any prepaid principal amount of any Note.
Section 8.6. Purchase of Notes. The Company will not and will not
permit any Affiliate to purchase, redeem, prepay or otherwise acquire, directly
or indirectly, any of the outstanding Notes except (a) upon the payment or
prepayment of the Notes in accordance with the terms of this Agreement and the
Notes or (b) pursuant to an offer to purchase made by the Company or an
Affiliate pro rata to the holders of all Notes at the time outstanding upon the
same terms and conditions. Any such offer shall provide each holder with
sufficient information to enable it to make an informed decision with respect to
such offer, and shall remain open for at least 30 Business Days. If the holders
of more than 30% of the principal amount of the Notes then outstanding accept
such offer, the Company shall promptly notify the remaining holders of such fact
and the expiration date for the acceptance by holders of Notes of such offer
shall be extended by the number of days necessary to give each such remaining
holder at least 30 Business Days from its receipt of such notice to accept such
offer. The Company will promptly cancel all Notes
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Otter Tail Corporation Note Purchase Agreement
acquired by it or any Affiliate pursuant to any payment, prepayment or purchase
of Notes pursuant to any provision of this Agreement and no Notes may be issued
in substitution or exchange for any such Notes.
Section 8.7. Make-Whole Amount. The term "Make-Whole Amount" means,
with respect to any Note, an amount equal to the excess, if any, of the
Discounted Value of the Remaining Scheduled Payments with respect to the Called
Principal of such Note over the amount of such Called Principal, provided that
the Make-Whole Amount may in no event be less than zero. For the purposes of
determining the Make-Whole Amount, the following terms have the following
meanings:
"Called Principal" means, with respect to any Note, the
principal of such Note that is to be prepaid pursuant to Section 8.2
or has become or is declared to be immediately due and payable
pursuant to Section 12.1, as the context requires.
"Discounted Value" means, with respect to the Called Principal
of any Note, the amount obtained by discounting all Remaining
Scheduled Payments with respect to such Called Principal from their
respective scheduled due dates to the Settlement Date with respect
to such Called Principal, in accordance with accepted financial
practice and at a discount factor (applied on the same periodic
basis as that on which interest on the Notes is payable) equal to
the Reinvestment Yield with respect to such Called Principal.
"Reinvestment Yield" means, with respect to the Called
Principal of any Note, 0.50% over the yield to maturity implied by
(i) the yields reported, as of 10:00 A.M. (New York City time) on
the second Business Day preceding the Settlement Date with respect
to such Called Principal, on the display designated as "Page 678" on
the Telerate Access Service (or such other display as may replace
Page 678 on the Telerate Access Service) for actively traded U.S.
Treasury securities having a maturity equal to the Remaining Average
Life of such Called Principal as of such Settlement Date, or (ii) if
such yields are not reported as of such time or the yields reported
as of such time are not ascertainable, the Treasury Constant
Maturity Series Yields reported, for the latest day for which such
yields have been so reported as of the second Business Day preceding
the Settlement Date with respect to such Called Principal, in
Federal Reserve Statistical Release H.15 (519) (or any comparable
successor publication) for actively traded U.S. Treasury securities
having a constant maturity equal to the Remaining Average Life of
such Called Principal as of such Settlement Date. Such implied yield
will be determined, if necessary, by (a) converting U.S. Treasury
▇▇▇▇ quotations to bond-equivalent yields in accordance with
accepted financial practice and (b) interpolating linearly between
(1) the actively traded U.S. Treasury security with the duration
closest to and greater than the Remaining Average Life and (2) the
actively traded U.S. Treasury security with the duration closest to
and less than the Remaining Average Life.
"Remaining Average Life" means, with respect to any Called
Principal, the number of years (calculated to the nearest
one-twelfth year) obtained by dividing (i) such Called Principal
into (ii) the sum of the products obtained by multiplying (a) the
principal component of each Remaining Scheduled Payment with respect
to such Called Principal
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Otter Tail Corporation Note Purchase Agreement
by (b) the number of years (calculated to the nearest one-twelfth
year) that will elapse between the Settlement Date with respect to
such Called Principal and the scheduled due date of such Remaining
Scheduled Payment.
"Remaining Scheduled Payments" means, with respect to the
Called Principal of any Note, all payments of such Called Principal
and interest thereon that would be due after the Settlement Date
with respect to such Called Principal if no payment of such Called
Principal were made prior to its scheduled due date, provided that
if such Settlement Date is not a date on which interest payments are
due to be made under the terms of the Notes, then the amount of the
next succeeding scheduled interest payment will be reduced by the
amount of interest accrued to such Settlement Date and required to
be paid on such Settlement Date pursuant to Section 8.2, 8.3 or
12.1.
"Settlement Date" means, with respect to the Called Principal
of any Note, the date on which such Called Principal is to be
prepaid pursuant to Section 8.2 or has become or is declared to be
immediately due and payable pursuant to Section 12.1, as the context
requires and with respect to the purchase of Notes pursuant to
Section 8.3, the date on which the Notes are required thereunder to
be purchased by the Company.
SECTION 9. AFFIRMATIVE COVENANTS.
The Company covenants that so long as any of the Notes are
outstanding:
Section 9.1. Compliance with Law. The Company will, and will cause each
of its Subsidiaries to, comply with all laws, ordinances or governmental rules
or regulations to which each of them is subject, including, without limitation,
Environmental Laws, and will obtain and maintain in effect all licenses,
certificates, permits, franchises and other governmental authorizations
necessary to the ownership of their respective properties or to the conduct of
their respective businesses, in each case to the extent necessary to ensure that
non-compliance with such laws, ordinances or governmental rules or regulations
or failures to obtain or maintain in effect such licenses, certificates,
permits, franchises and other governmental authorizations would not reasonably
be expected, individually or in the aggregate, to have a Material Adverse
Effect.
Section 9.2. Insurance. The Company will, and will cause each of its
Subsidiaries to, maintain, with financially sound and reputable insurers,
insurance with respect to their respective properties and businesses against
such casualties and contingencies, of such types, on such terms and in such
amounts (including deductibles, co-insurance and self-insurance, if adequate
reserves are maintained with respect thereto) as is customary in the case of
entities of established reputations engaged in the same or a similar business
and similarly situated.
Section 9.3. Maintenance of Properties. The Company will, and will
cause each of its Subsidiaries to, maintain and keep, or cause to be maintained
and kept, their respective properties in good repair, working order and
condition (other than ordinary wear and tear), so that the business carried on
in connection therewith may be properly conducted at all times, provided that
this Section shall not prevent the Company or any Subsidiary from discontinuing
the operation
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Otter Tail Corporation Note Purchase Agreement
and the maintenance of any of its properties if such discontinuance is desirable
in the conduct of its business and the Company has concluded that such
discontinuance would not, individually or in the aggregate, have a Material
Adverse Effect.
Section 9.4. Payment of Taxes. The Company will, and will cause each of
its Subsidiaries to, file all income tax or similar tax returns required to be
filed in any jurisdiction and to pay and discharge all taxes shown to be due and
payable on such returns and all other taxes, assessments, governmental charges,
or levies payable by any of them, to the extent such taxes and assessments have
become due and payable and before they have become delinquent, provided that
neither the Company nor any Subsidiary need pay any such tax or assessment if
(i) the amount, applicability or validity thereof is contested by the Company or
such Subsidiary on a timely basis in good faith and in appropriate proceedings,
and the Company or a Subsidiary has established adequate reserves therefor in
accordance with GAAP on the books of the Company or such Subsidiary or (ii) the
nonpayment of all such taxes and assessments in the aggregate would not
reasonably be expected to have a Material Adverse Effect.
Section 9.5. Corporate Existence, etc. Subject to Sections 10.4 and
10.5 the Company will at all times preserve and keep in full force and effect
its corporate existence. Subject to Sections 10.4 and 10.5, the Company will at
all times preserve and keep in full force and effect the corporate existence of
each of its Subsidiaries and all rights and franchises of the Company and its
Subsidiaries unless, in the good faith judgment of the Company, the termination
of or failure to preserve and keep in full force and effect such corporate
existence, right or franchise would not, individually or in the aggregate, have
a Material Adverse Effect.
Section 9.6. Note Exchange Upon Issuance of Bonds. (a) In the event that
the Company shall issue additional Bonds under and pursuant to the Indenture
(the "Additional Bonds"), then the Company shall offer to exchange all of the
outstanding Notes for Bonds of a new series (the "Exchange Bonds") which
exchange would take place concurrently with or prior to the issuance of such
Additional Bonds. The Exchange Bonds shall be issued under and secured by the
Indenture, shall rank pari passu with all other Bonds issued and outstanding
under the Indenture, shall have payment and maturity terms identical to the
Notes for which they were exchanged, subject to provisions required to be in the
Exchange Bonds pursuant to the terms of the Indenture, shall have required and
optional prepayment provisions and provisions relating to amounts payable upon
acceleration of maturity identical to those applicable to the Notes for which
they were exchanged and shall otherwise be in the form required by the
Indenture.
(b) The Company will, within 30 days after the Company's decision to
issue Additional Bonds, give written notice of such decision to each holder of
Notes which shall constitute an offer to exchange the Notes for the Exchange
Bonds as described in subparagraph (b) of this Section 9.6.
(c) The offer to exchange the Notes for the Exchange Bonds
contemplated by subparagraph (b) of this Section 9.6 shall be an offer to
exchange, in accordance with and subject to this Section 9.6, all, but not less
than all, the Notes held by each holder on a date specified in such offer (the
"Proposed Exchange Date") that is not less than 15 days and not more than 30
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Otter Tail Corporation Note Purchase Agreement
days after the date of such offer (if the Proposed Exchange Date shall not be
specified in such offer, the Proposed Exchange Date shall be the 30th day after
the date of such offer).
(d) A holder of Notes may accept the offer to exchange made pursuant
to this Section 9.6 by causing a notice of such acceptance to be delivered to
the Company at least 10 days prior to the Proposed Exchange Date. A failure by a
holder of Notes to respond to an offer to exchange made pursuant to this Section
9.6 shall be deemed to constitute a rejection of such offer by such holder.
(e) The Company covenants and agrees to take all actions necessary
for the due authorization, execution and delivery of such Exchange Bonds
including, without limitation, (i) the filing with the Minnesota Public
Utilities Commission of documents required in connection with the issuance of
the Exchange Bonds, (ii) compliance with all requirements of the Indenture, and
(iii) the taking of all other actions the holders of the Notes may reasonable
request in connection with the delivery of the Exchange Bonds, including the
delivery of legal opinions and an exchange agreement between the Company and the
holders in form and substance reasonably satisfactory to the holders of 66-2/3%
of the Notes then outstanding.
Section 9.7. Private Ratings. If at any time the Company does not have
Senior Debt that is rated by both Designated Rating Agencies, upon the request
of the Required Holders, the Company will promptly, and in any event within 15
days after receiving such request, notify each other holder of a Note of such
request and seek and thereafter diligently attempt to obtain from a Designated
Rating Agency which is not then so rating such Senior Debt a private credit
rating for the Notes, and, promptly, and in any event within 5 days after
receiving such rating, deliver a copy thereof to each holder of a Note. If the
Company does not obtain a private credit rating for the Notes from a Designated
Rating Agency within 70 days after the Required Holders shall have requested the
Company to obtain a rating in accordance with this Section 9.7, the Company will
promptly, and in any event within five days after the end of such 70-day period,
notify each holder of a Note of such failure.
Section 9.8. Guaranty by Subsidiaries. The Company will cause any
Subsidiary which after the Closing guarantees the obligations of the Company
under the Bank Credit Agreement (an "Additional Subsidiary Guarantor") to enter
into the Guaranty Agreement, and deliver within 15 Business Days thereafter to
each of the holders of the Notes the following items:
(a) an agreement substantially in the form of Exhibit A to the
Guaranty Agreement;
(b) a certificate signed by the President, a Vice President
or another authorized Responsible Officer of the Company making
representations and warranties to the effect of those contained in
Sections 5.4, 5.6 and 5.7, with respect to such Additional
Subsidiary Guarantor and the Guaranty Agreement, as applicable;
(c) such documents and evidence with respect to such
Additional Subsidiary Guarantor as any holder of the Notes may
reasonably request in order to establish the existence and good
standing of such Additional Subsidiary Guarantor; and
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Otter Tail Corporation Note Purchase Agreement
(d) an opinion of counsel addressed to each of the holders of
the Notes satisfactory to the Required Holders, to the effect that
the Guaranty Agreement has been duly authorized, executed and
delivered and constitutes the legal, valid and binding contract and
agreement of such Additional Subsidiary Guarantor enforceable in
accordance with its terms, except as an enforcement of such terms
may be limited by bankruptcy, insolvency, fraudulent conveyance and
similar laws affecting the enforcement of creditors' rights
generally and by general equitable principles.
Section 9.9. New Bank Agreement. The Company agrees that (i) on or
before March 31, 2002 it will enter into a written commitment (the "Bank
Commitment") with a lender or lenders (herein referred to in this Section 9.9
collectively as the "Bank") for a new Bank Credit Agreement (the "New Bank
Agreement") with such Bank (A) which will replace the existing Bank Credit
Agreement with a senior unsecured revolving credit facility for the Company as
borrower thereunder of at least $50,000,000, (B) which will contain financial
covenants substantially similar to those covenants contained in Section 10
hereof without regard to the application of Section 10.7, with such covenants
subject to the prior review of the Holders, and (C) which requires the agreement
of the Bank to the execution of the Intercreditor Agreement substantially in the
form attached hereto as Exhibit 3 prior to closing and (ii) on or before April
30, 2002, the New Bank Agreement will be executed and delivered by the Company
and the Bank (the completion of the execution and delivery of the New Bank
Agreement being the "Bank Closing" and the date of the Bank Closing being the
"Bank Closing Date"). It shall not be considered an Event of Default hereunder
if the Company fails to enter into a Bank Commitment by March 31, 2002 or if the
Bank Closing does not occur by April 30, 2002.
In the event the Company does not enter into a Bank Commitment by March
31, 2002 or in the event the Bank Closing does not occur by April 30, 2002, the
Company shall pay each Holder on the Bank Closing Date (subject to an earlier
payment requirement in the following sentence) a fee (the "Interest Fee") which
shall accrue during the period beginning on the Accrual Start Date and ending on
the date such fee is required by this paragraph to be paid at the rate of 0.25%
per annum on the aggregate outstanding principal amount of the Notes held by
such Holder where "Accrual Start Date" means March 31, 2002 if the Bank
Commitment is not entered into by that date or, if it is, April 30, 2002. If the
Company does not enter into a Bank Commitment by June 30, 2002 or in the event
the Bank Closing does not occur by July 31, 2002, the Company (i) shall pay to
each Holder on the Second Accrual Start Date the Interest Fee such Holder is
entitled to receive pursuant to the foregoing provisions of this paragraph and
(ii) shall pay to each Holder on the Bank Closing Date a replacement fee (the
"Replacement Interest Fee") which shall replace the Interest Fee and shall
accrue during the period beginning on the Second Accrual Start Date and ending
on the Bank Closing Date at the rate of 1.00% per annum on the aggregate
principal amount of the Notes held by such Holder where "Second Accrual Start
Date" means June 30, 2002 if the Bank Commitment is not entered into by that
date, or if it is, July 31, 2002; provided, that if the Bank Closing Date has
not occurred by August 31, 2002, the Company shall pay the Replacement Interest
Fee in monthly installments accrued to date commencing with a payment to each
Holder on September 1, 2002 and on the first day of each month thereafter with
the final Replacement Interest Fee accrued to the Bank Closing Date to be paid
on such Bank Closing Date.
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Otter Tail Corporation Note Purchase Agreement
Section 9.10. Additional Lenders under Intercreditor Agreement. Prior
to any lending institution becoming an additional Lender under the Bank Credit
Agreement after the Bank Closing Date, the Company will require such institution
to become a party to the Intercreditor Agreement by executing a copy for each
Noteholder of the agreement in the form of Exhibit A to the Intercreditor
Agreement (an "Additional Lender Agreement"). Upon receipt of any Additional
Lender Agreement, the Company shall forthwith deliver an executed copy thereof
to each Noteholder.
Section 9.11. New Noteholders under Intercreditor Agreement. Upon the
Bank Closing Date all Noteholders shall become a party to the Intercreditor
Agreement (and hereby agree to do so) and at any time thereafter any Person
which becomes a successor Noteholder shall be deemed to have concurrently become
a party to the Intercreditor Agreement.
Section 9.12. Release of Guaranty Agreement. Upon receipt by the
Noteholders of written notice from the Company and the Lenders that the guaranty
obligations of any of the Subsidiary Guarantors and any Additional Subsidiary
Guarantors under the Bank Credit Agreement have been released by the Lenders,
the obligations of such Subsidiary Guarantors and such Additional Subsidiary
Guarantors under the Guaranty Agreement shall be released and if such
obligations of all Subsidiary Guarantors and all Additional Subsidiary
Guarantors have been released the Guaranty Agreement and the Intercreditor
Agreement shall terminate and the Noteholders agree that they shall take such
action as shall be necessary to effectuate such termination; provided, that if
at any time thereafter the Bank Credit Agreement shall again be guaranteed by
any Subsidiary (i) the Company will, within 30 days, cause such Subsidiary to
comply with the requirements of Sections 9.8(a) through (d) and (ii) the
Intercreditor Agreement shall be re-executed by the Noteholders and the Lenders.
SECTION 10. NEGATIVE COVENANTS.
The Company covenants that so long as any of the Notes are
outstanding:
Section 10.1. Limitation on Debt and Priority Debt. (a) The Company
will not permit Consolidated Debt to exceed 60% of Consolidated Total
Capitalization determined as of the end of each fiscal quarter of the Company.
(b) The Company will not permit Priority Debt to exceed 20% of
Consolidated Total Capitalization determined as of the end of each fiscal
quarter of the Company.
Section 10.2. Interest Charges Coverage Ratio. The Company will not
permit the Interest Charges Coverage Ratio to be less than 1.5:1.0 determined as
of the end of the most recently ended period of four consecutive fiscal quarters
of the Company.
Section 10.3. Limitation on Liens. The Company will not, and will not
permit any Subsidiary to, directly or indirectly create, incur, assume or permit
to exist (upon the happening of a contingency or otherwise) any Lien on or with
respect to any property or asset (including, without limitation, any document or
instrument in respect of goods or accounts receivable) of the Company or any
such Subsidiary, whether now owned or held or hereafter acquired, or any
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income or profits therefrom, or assign or otherwise convey any right to receive
income or profits, except:
(a) Liens for taxes and assessments or governmental charges
or levies and Liens securing claims or demands of mechanics and
materialmen; provided that payment thereof is not at the time required
by Section 9.4;
(b) Liens of or resulting from any judgment or award in an
aggregate amount not to exceed $10,000,000, the time for the appeal or
petition for rehearing of which shall not have expired, or in respect
of which the Company or a Subsidiary shall at any time in good faith be
prosecuting an appeal or proceeding for a review and in respect of
which a stay of execution pending such appeal or proceeding for review
shall have been secured;
(c) Liens incidental to the conduct of business or the
ownership of properties and assets (including, without limitation,
Liens in connection with worker's compensation, unemployment insurance
and other like laws, carrier's, warehousemen's liens and statutory
landlords' liens) and Liens to secure the performance of bids, tenders
or trade contracts, or to secure statutory obligations, surety or
appeal bonds or other Liens of like general nature, in any such case
incurred in the ordinary course of business and not in connection with
the borrowing of money; provided in each case, the obligation secured
is not overdue or, if overdue, is being contested in good faith by
appropriate actions or proceedings;
(d) minor survey exceptions or minor encumbrances, easements
or reservations, or rights of others for rights-of-way, utilities and
other similar purposes, or zoning or other restrictions as to the use
of real properties, which are reasonably necessary for the conduct of
the activities of the Company and its Subsidiaries or which customarily
exist on properties of corporations engaged in similar activities and
similarly situated and which do not in any event materially impair
their use in the operation of the business of the Company and its
Subsidiaries;
(e) Liens securing Debt of a Subsidiary to the Company or to
another Subsidiary;
(f) Liens on property of the Company created by the Indenture
to secure Bonds of the Company issued and outstanding thereunder and
described on Schedule 5.15, including property acquired by the Company
after the Closing Date to which such Liens attach;
(g) Liens in addition to those permitted by clause (f) hereof
existing as of December 1, 2001 and described on Schedule 5.15 hereto
and Liens securing any refinancing of Indebtedness secured by such
Liens, provided that such refinancing shall be subject to similar terms
and secured by the same assets and the principal amount of Indebtedness
secured thereby is not increased;
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(h) Liens in connection with the acquisition of property
after the date hereof by way of purchase money mortgage, conditional
sale or other title retention agreement, Capital Lease or other
deferred payment contract, provided that such Liens attach only to the
property being acquired and that the Debt secured thereby does not
exceed the Fair Market Value of such property at the time of
acquisition thereof and the Lien shall be created contemporaneously
with, or within 180 days after, the acquisition of such property;
(i) Liens that existed on assets of other Persons at the time
of acquisition of such other Persons or of such assets by the Company
or a Subsidiary and which continue to attach only to such assets and
Liens securing any refinancing of Indebtedness secured by such Liens,
provided that such refinancing shall be subject to similar terms and
secured by the same assets and the principal amount of Indebtedness
secured thereby is not increased); and
(j) Liens created, assumed or incurred after the date of the
Closing given to secure Debt of the Company or any Subsidiary in
addition to the Liens permitted by the preceding clauses (a) through
(i) hereof;
provided that (1) all Debt secured by such Liens shall have been incurred within
the applicable limitations provided in Section 10.1(b) and (2) at the time of
creation, assumption or incurrence of the Debt secured by such Lien and after
giving effect thereto and to the application of the proceeds thereof, no Default
or Event of Default would exist.
Section 10.4. Merger, Consolidation, Etc. The Company will not, and
will not permit any Subsidiary Guarantor or any Additional Subsidiary Guarantor
to, consolidate with or merge with any other corporation or convey, transfer or
lease substantially all of its assets in a single transaction or series of
transactions to any Person; provided that:
(a) Any Subsidiary Guarantor or any Additional Subsidiary
Guarantor may directly or indirectly merge or consolidate with or into,
or transfer all or substantially all of its property to, or be a party
to an analogous reorganization with the Company or any Subsidiary so
long as (i) in any such transaction involving the Company, the Company
shall be the surviving or continuing Person and (ii) in any such
transaction involving a Subsidiary which is the surviving or continuing
Person, such Subsidiary, unless the Guaranty Agreement shall have been
released pursuant to Section 9.12, shall become obligated under the
Guaranty Agreement and shall provide to the holders of the Notes the
items described in Section 9.8 (a) through (d) concurrently with the
consummation of such transaction; provided further, that a Subsidiary
may transfer all or substantially all of its property without complying
with the foregoing provisions of this clause (a) if the transfer is in
compliance with Section 10.5; and
(b) the Company may consolidate or merge with or into, or
transfer all or substantially all of its property to, or be a party to
an analogous reorganization with any other Person if (1) the successor
formed by such transaction or the Person that acquires in such
transaction substantially all of the assets of the Company as an
entirety, as the
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Otter Tail Corporation Note Purchase Agreement
case may be, (the "Successor") shall be a solvent Person organized and
existing under the laws of the United States or any state thereof
(including the District of Columbia), and, (2) if the Company is not
the Successor, (A) such Successor shall have executed and delivered to
each holder of any Notes its assumption of the due and punctual
performance and observance of each covenant and condition of this
Agreement and the Notes, and (B) such Successor shall have caused to be
delivered to each holder of any Notes an opinion of nationally
recognized independent counsel, or other independent counsel reasonably
satisfactory to the Required Holders, to the effect that all agreements
or instruments effecting such assumption are enforceable in accordance
with their terms and comply with the terms hereof, and (3) immediately
before and after giving effect to such transaction, no Default or Event
of Default shall have occurred and be continuing; provided, that no
such conveyance, transfer or lease of substantially all of the assets
of the Company shall have the effect of releasing the Company or any
Successor from its liability under this Agreement or the Notes.
Section 10.5. Sale of Assets, Etc. Except as permitted under Section
10.4, the Company will not, and will not permit any of its Subsidiaries to,
make any Asset Disposition unless:
(a) in the good faith opinion of the Company, the Asset
Disposition is in exchange for consideration having a Fair Market Value
at least equal to that of the property exchanged and is in the best
interest of the Company or such Subsidiary; and
(b) immediately after giving effect to the Asset Disposition,
no Default or Event of Default would exist;
(c) immediately after giving effect to the Asset Disposition,
the Disposition Value of all property that was the subject of any Asset
Disposition occurring in the period of four fiscal quarters of the
Company then next ending would not exceed 15% of Consolidated Assets as
of the end of the then most recently ended fiscal year of the Company;
provided, that if the Net Proceeds Amount for any Transfer is applied
to a Debt Prepayment Application or a Property Reinvestment Application
within 180 days after such Transfer, then such Transfer, only for the
purpose of determining compliance with subsection (c) of this Section
10.5 as of a date on or after the Net Proceeds Amount is so applied,
shall be deemed not to be an Asset Disposition; provided, however, that
if the Asset Disposition is a Transfer of Utility Assets, such Transfer
of Utility Assets by the Company shall be deemed not to be an Asset
Disposition for such purposes only to the extent the Net Proceeds
Amount therefrom is applied to a Utility Property Reinvestment
Application within 180 days after such Transfer; and
(d) immediately after giving effect to a Transfer of Utility
Assets, the Disposition Value of all property that was the subject of
any Transfer of Utility Assets (i) occurring in the period of four
fiscal quarters of the Company then next ending would not exceed 10% of
Total Utility Plant (the "10% Four Quarter Limit") as of the end of the
then most recently ended fiscal year of the Company, and (ii) occurring
after the Closing Date through the date of determination would not
exceed 25% of Total Utility Plant (the "25% Cumulative Limit") as of
the end of the then most recently ended fiscal
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Otter Tail Corporation Note Purchase Agreement
year; provided, that if the Net Proceeds Amount for any Transfer is
applied to a Utility Property Reinvestment Application within 180
days after such Transfer, then such Transfer, only for purposes of
compliance with subsection (d) of this Section 10.5 as of a date on
or after the Net Proceeds Amount is so applied, shall be deemed not
to be a Transfer of Utility Assets; provided, however, that if the
Disposition Value of any property subject to a Transfer of Utility
Assets when added to the Disposition Value of other Transfers of
Utility Assets pursuant to clause (i) or (ii) of this subsection (d)
would be in excess of either or both of the applicable 10% Four
Quarter Limit or the 25% Cumulative Limit, then such Transfer shall
be deemed not to be a Transfer of Utility Assets for purposes of
compliance with subsection (d) of this Section 10.5 only if the Net
Proceeds Amount for such Transfer is (A) deposited upon receipt by
the Company in a segregated investment account with an institution
which is not a creditor of the Company or any of its Subsidiaries
and kept therein until application under the following clause (B)
and (B) applied directly to a Utility Property Reinvestment
Application within 180 days after such Transfer.
Section 10.6. Transactions with Affiliates. The Company will not and
will not permit any Subsidiary to enter into directly or indirectly any Material
transaction or Material group of related transactions (including without
limitation the purchase, lease, sale or exchange of properties of any kind or
the rendering of any service) with any Affiliate (other than the Company or
another Subsidiary), except pursuant to the reasonable requirements of the
Company's or such Subsidiary's business and upon fair and reasonable terms no
less favorable to the Company or such Subsidiary than would be obtainable in a
comparable arm's-length transaction with a Person not an Affiliate.
Section 10.7 Benefit of More Restrictive Covenants or More Favorable
Terms. If any Lender under the Bank Credit Agreement is or becomes entitled to
the benefit of any covenant, agreement, event of default or other event which
would permit the Lender to have the Company Debt obligations it holds purchased
by the Company (a "put event") which is more restrictive on the Company or its
Subsidiaries than the covenants, agreements, events of default or put events
contained herein or which is more favorable to such Lender than the covenants,
agreements, events of default or put events contained herein, then such more
restrictive or more favorable covenant, agreement, event of default or put event
shall be deemed to be incorporated into this Agreement by reference during any
period such Lender is so entitled thereto without regard to any waivers by the
Lender with respect thereto and shall remain so incorporated for a period of 30
days after the Lender is no longer entitled to the benefit thereof and the
Noteholders shall be entitled to the benefits thereof with respect to this
Agreement in addition to the existing covenants, agreements, events of default
and put events contained herein so long as any of the Notes remain outstanding.
Prior to any closing of a Bank Credit Agreement, the Company shall
deliver a letter to the Noteholders containing a list of those covenants,
agreements, events of default and put events which are deemed to be incorporated
into this Agreement pursuant to the foregoing provisions of this Section 10.7
and concurrently with or prior to the execution of any amendment to the Bank
Credit Agreement, the Company shall deliver to the Noteholders a letter setting
forth all covenants, agreements, events of default and put events and/or changes
with respect thereto
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Otter Tail Corporation Note Purchase Agreement
which are deemed to be incorporated into this Agreement pursuant to the
foregoing provisions of this Section 10.7 and any such letters delivered to the
Noteholders shall be satisfactory in form and substance to the Noteholders;
provided that if a New Bank Agreement referred to in Section 9.9 is not entered
into by April 30, 2002, the Company shall deliver such a letter to the
Noteholders with respect to the Bank Credit Agreement in existence on the
Closing Date. At any time after the receipt of any such letter the Required
Holders shall have the right by delivery of written notice to the Company to
amend this Agreement by adding to the Agreement any covenants, agreements,
events of default or put events referred to in any such letter which the
Required Holders elect to add pursuant to the foregoing provision of this
Section 10.7.
SECTION 11. EVENTS OF DEFAULT.
An "Event of Default" shall exist if any of the following conditions or
events shall occur and be continuing:
(a) the Company defaults in the payment of any principal or
Make-Whole Amount, if any, on any Note when the same becomes due and
payable, whether at maturity or at a date fixed for prepayment or by
declaration or otherwise; or
(b) the Company defaults in the payment of any interest on any
Note for more than five Business Days after the same becomes due and
payable; or
(c) the Company defaults (i) in the performance of or
compliance with any term contained in Section 10 or Section 7.1(d) or
(ii) in the payment when due of the amount required to be paid by the
Company for the purchase of any Notes pursuant to Section 8.3; or
(d) the Company defaults in the performance of or compliance
with any term contained herein (other than those referred to in
paragraphs (a), (b) and (c) of this Section 11) and such default is not
remedied within 30 days after the earlier of (i) a Responsible Officer
obtaining actual knowledge of such default and (ii) the Company
receiving written notice of such default from any holder of a Note (any
such written notice to be identified as a "notice of default" and to
refer specifically to this paragraph (d) of Section 11); or
(e) any representation or warranty made in writing by or on
behalf of the Company or by any officer of the Company in this
Agreement or in any writing furnished in connection with the
transactions contemplated hereby proves to have been false or incorrect
in any material respect on the date as of which made; or
(f) (i) the Company or any Significant Subsidiary is in
default (as principal or as guarantor or other surety) in the payment
of any principal of or premium or make-whole amount or interest on any
Indebtedness that is outstanding in an aggregate principal amount of at
least $10,000,000 beyond any period of grace provided with respect
thereto, or (ii) the Company or any Significant Subsidiary is in
default in the performance of or compliance with any term of any
evidence of any Indebtedness in an
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Otter Tail Corporation Note Purchase Agreement
aggregate outstanding principal amount of at least $10,000,000 or of
any mortgage, indenture or other agreement relating thereto or any
other condition exists, and as a consequence of such default or
condition such Indebtedness has become, or has been declared (or one or
more Persons are entitled to declare such Indebtedness to be), due and
payable before its stated maturity or before its regularly scheduled
dates of payment; or
(g) the Company or any Significant Subsidiary (i) is
generally not paying, or admits in writing its inability to pay, its
debts as they become due, (ii) files, or consents by answer or
otherwise to the filing against it of, a petition for relief or
reorganization or arrangement or any other petition in bankruptcy, for
liquidation or to take advantage of any bankruptcy, insolvency,
reorganization, moratorium or other similar law of any jurisdiction,
(iii) makes an assignment for the benefit of its creditors, (iv)
consents to the appointment of a custodian, receiver, trustee or other
officer with similar powers with respect to it or with respect to any
substantial part of its property, (v) is adjudicated as insolvent or to
be liquidated, or (vi) takes corporate action for the purpose of any of
the foregoing; or
(h) a court or governmental authority of competent
jurisdiction enters an order appointing, without consent by the Company
or any of its Significant Subsidiaries, a custodian, receiver, trustee
or other officer with similar powers with respect to it or with respect
to any substantial part of its property, or constituting an order for
relief or approving a petition for relief or reorganization or any
other petition in bankruptcy or for liquidation or to take advantage of
any bankruptcy or insolvency law of any jurisdiction, or ordering the
dissolution, winding-up or liquidation of the Company or any of its
Significant Subsidiaries, or any such petition shall be filed against
the Company or any of its Significant Subsidiaries and such petition
shall not be dismissed within 60 days; or
(i) a final judgment or judgments for the payment of money
aggregating in excess of $10,000,000 are rendered against one or more
of the Company and its Significant Subsidiaries and which judgments are
not, within 60 days after entry thereof, bonded, discharged or stayed
pending appeal, or are not discharged within 60 days after the
expiration of such stay; or
(j) default shall occur in the observance or performance of
any provision of the Guaranty Agreement or the Guaranty Agreement shall
cease to be in full force and effect for any reason except by operation
of Section 9.12, including, without limitation, a final and
nonappealable determination by any governmental body or court that the
Guaranty Agreement is invalid, void or unenforceable, or any Subsidiary
Guarantor or any Additional Subsidiary Guarantor shall contest or deny
in writing the validity or enforceability of any provision of, or
obligation under, the Guaranty Agreement; or
(k) if (i) any Plan shall fail to satisfy the minimum funding
standards of ERISA or the Code for any plan year or part thereof or a
waiver of such standards or extension of any amortization period is
sought or granted under section 412 of the Code, (ii) a notice of
intent to terminate any Plan shall have been or is reasonably expected
to be filed with the PBGC or the PBGC shall have instituted proceedings
under ERISA
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Otter Tail Corporation Note Purchase Agreement
section 4042 to terminate or appoint a trustee to administer any
Plan or the PBGC shall have notified the Company or any ERISA
Affiliate that a Plan may become a subject of any such proceedings,
(iii) the aggregate "amount of unfunded benefit liabilities" (within
the meaning of section 4001(a)(18) of ERISA) under all Plans,
determined in accordance with Title IV of ERISA, shall exceed
$10,000,000, (iv) the Company or any ERISA Affiliate shall have
incurred or is reasonably expected to incur any liability pursuant
to Title I or IV of ERISA or the penalty or excise tax provisions of
the Code relating to employee benefit plans, (v) the Company or any
ERISA Affiliate withdraws from any Multiemployer Plan, or (vi) the
Company or any Subsidiary establishes or amends any employee welfare
benefit plan that provides post-employment welfare benefits in a
manner that would increase the liability of the Company or any
Subsidiary thereunder; and any such event or events described in
clauses (i) through (vi) above, either individually or together with
any other such event or events, would reasonably be expected to have
a Material Adverse Effect.
As used in Section 11(k), the terms "employee benefit plan" and "employee
welfare benefit plan" shall have the respective meanings assigned to such terms
in section 3 of ERISA.
SECTION 12. REMEDIES ON DEFAULT, ETC.
Section 12.1. Acceleration. (a) If an Event of Default with respect to
the Company described in paragraph (g) or (h) of Section 11 (other than an Event
of Default described in clause (i) of paragraph (g) or described in clause (vi)
of paragraph (g) by virtue of the fact that such clause encompasses clause (i)
of paragraph (g)) has occurred, all the Notes then outstanding shall
automatically become immediately due and payable.
(b) If any other Event of Default has occurred and is continuing,
the Required Holders may at any time at its or their option, by notice or
notices to the Company, declare all the Notes then outstanding to be immediately
due and payable.
(c) If any Event of Default described in paragraph (a) or (b) of
Section 11 has occurred and is continuing, any holder of Notes at the time
outstanding affected by such Event of Default may at any time, at its option, by
notice or notices to the Company, declare all the Notes held by it to be
immediately due and payable.
Upon any Notes becoming due and payable under this Section 12.1,
whether automatically or by declaration, such Notes will forthwith mature and
the entire unpaid principal amount of such Notes, plus (i) all accrued and
unpaid interest thereon and (ii) the Make-Whole Amount determined in respect of
such principal amount (to the full extent permitted by applicable law), shall
all be immediately due and payable, in each and every case without presentment,
demand, protest or further notice, all of which are hereby waived. The Company
acknowledges, and the parties hereto agree, that each holder of a Note has the
right to maintain its investment in the Notes free from repayment by the Company
(except as herein specifically provided for), and that the provision for payment
of a Make-Whole Amount by the Company in the event that the Notes are prepaid or
are accelerated as a result of an Event of Default, is intended to provide
compensation for the deprivation of such right under such circumstances.
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Otter Tail Corporation Note Purchase Agreement
Section 12.2. Other Remedies. If any Default or Event of Default has
occurred and is continuing, and irrespective of whether any Notes have become or
have been declared immediately due and payable under Section 12.1, the holder of
any Note at the time outstanding may proceed to protect and enforce the rights
of such holder by an action at law, suit in equity or other appropriate
proceeding, whether for the specific performance of any agreement contained
herein or in any Note, or for an injunction against a violation of any of the
terms hereof or thereof, or in aid of the exercise of any power granted hereby
or thereby or by law or otherwise.
Section 12.3. Rescission. At any time after any Notes have been
declared due and payable pursuant to clause (b) or (c) of Section 12.1, the
holders of not less than 51% in principal amount of the Notes then outstanding,
by written notice to the Company, may rescind and annul any such declaration and
its consequences if (a) the Company has paid all overdue interest on the Notes,
all principal of and Make-Whole Amount, if any, on any Notes that are due and
payable and are unpaid other than by reason of such declaration, and all
interest on such overdue principal and Make-Whole Amount, if any, and (to the
extent permitted by applicable law) any overdue interest in respect of the
Notes, at the Default Rate, (b) all Events of Default and Defaults, other than
non-payment of amounts that have become due solely by reason of such
declaration, have been cured or have been waived pursuant to Section 17, and (c)
no judgment or decree has been entered for the payment of any monies due
pursuant hereto or to the Notes. No rescission and annulment under this Section
12.3 will extend to or affect any subsequent Event of Default or Default or
impair any right consequent thereon.
Section 12.4. No Waivers or Election of Remedies, Expenses, etc. No
course of dealing and no delay on the part of any holder of any Note in
exercising any right, power or remedy shall operate as a waiver thereof or
otherwise prejudice such holder's rights, powers or remedies. No right, power or
remedy conferred by this Agreement or by any Note upon any holder thereof shall
be exclusive of any other right, power or remedy referred to herein or therein
or now or hereafter available at law, in equity, by statute or otherwise.
Without limiting the obligations of the Company under Section 15, the Company
will pay to the holder of each Note on demand such further amount as shall be
sufficient to cover all costs and expenses of such holder incurred in any
enforcement or collection under this Section 12, including, without limitation,
reasonable attorneys' fees, expenses and disbursements.
SECTION 13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.
Section 13.1. Registration of Notes. The Company shall keep at its
principal executive office a register for the registration and registration of
transfers of Notes. The name and address of each holder of one or more Notes,
each transfer thereof and the name and address of each transferee of one or more
Notes shall be registered in such register. Prior to due presentment for
registration of transfer, the Person in whose name any Note shall be registered
shall be deemed and treated as the owner and holder thereof for all purposes
hereof, and the Company shall not be affected by any notice or knowledge to the
contrary. The Company shall give to any holder of a Note that is an
Institutional Investor promptly upon request therefor, a complete and correct
copy of the names and addresses of all registered holders of Notes.
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Otter Tail Corporation Note Purchase Agreement
Section 13.2. Transfer and Exchange of Notes. Upon surrender of any
Note at the principal executive office of the Company for registration of
transfer or exchange (and in the case of a surrender for registration of
transfer, duly endorsed or accompanied by a written instrument of transfer duly
executed by the registered holder of such Note or its attorney duly authorized
in writing and accompanied by the address for notices of each transferee of such
Note or part thereof), the Company shall execute and deliver, at the Company's
expense (except as provided below), one or more new Notes (as requested by the
holder thereof) in exchange therefor, in an aggregate principal amount equal to
the unpaid principal amount of the surrendered Note. Each such new Note shall be
payable to such Person as such holder may request and shall be substantially in
the form of Exhibit 1. Each such new Note shall be dated and bear interest from
the date to which interest shall have been paid on the surrendered Note or dated
the date of the surrendered Note if no interest shall have been paid thereon.
The Company may require payment of a sum sufficient to cover any stamp tax or
governmental charge imposed in respect of any such transfer of Notes. Notes
shall not be transferred in denominations of less than $100,000, provided that
if necessary to enable the registration of transfer by a holder of its entire
holding of Notes, one Note may be in a denomination of less than $100,000. Any
transferee of a Note, or purchaser of a participation therein, shall, by its
acceptance of such Note be deemed to make the same representations to the
Company regarding the Note or participation as the Purchasers have made pursuant
to Section 6.2.
Section 13.3. Replacement of Notes. Upon receipt by the Company of
evidence reasonably satisfactory to it of the ownership of and the loss, theft,
destruction or mutilation of any Note (which evidence shall be, in the case of
an Institutional Investor, notice from such Institutional Investor of such
ownership and such loss, theft, destruction or mutilation), and
(a) in the case of loss, theft or destruction, of indemnity
reasonably satisfactory to it (provided that if the holder of such
Note is, or is a nominee for, an original Purchaser or another
holder of a Note with a minimum net worth of at least $25,000,000,
such Person's own unsecured agreement of indemnity shall be deemed
to be satisfactory), or
(b) in the case of mutilation, upon surrender and cancellation
thereof,
the Company at its own expense shall execute and deliver, in lieu thereof, a new
Note, dated and bearing interest from the date to which interest shall have been
paid on such lost, stolen, destroyed or mutilated Note or dated the date of such
lost, stolen, destroyed or mutilated Note if no interest shall have been paid
thereon.
SECTION 14. PAYMENTS ON NOTES.
Section 14.1. Place of Payment. Subject to Section 14.2, payments of
principal, Make-Whole Amount, if any, and interest becoming due and payable on
the Notes shall be made in Fargo, North Dakota at the principal office of the
Company. The Company may at any time, by notice to each holder of a Note, change
the place of payment of the Notes so long as such place of payment shall be
either the principal office of the Company in such jurisdiction or the principal
office of a bank or trust company in such jurisdiction.
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▇▇▇▇▇ ▇▇▇▇ Corporation Note Purchase Agreement
Section 14.2. Home Office Payment. So long as any Purchaser or such
Purchaser's nominee shall be the holder of any Note, and notwithstanding
anything contained in Section 14.1 or in such Note to the contrary, the Company
will pay all sums becoming due on such Note for principal, Make-Whole Amount, if
any, and interest by the method and at the address specified for such purpose
below such Purchaser's name in Schedule A, or by such other method or at such
other address as such Purchaser shall have from time to time specified to the
Company in writing for such purpose, without the presentation or surrender of
such Note or the making of any notation thereon, except that upon written
request of the Company made concurrently with or reasonably promptly after
payment or prepayment in full of any Note, such Purchaser shall surrender such
Note for cancellation, reasonably promptly after any such request, to the
Company at its principal executive office or at the place of payment most
recently designated by the Company pursuant to Section 14.1. Prior to any sale
or other disposition of any Note held by such Purchaser or such Purchaser's
nominee such Purchaser will, at such Purchaser's election, either endorse
thereon the amount of principal paid thereon and the last date to which interest
has been paid thereon or surrender such note to the Company in exchange for a
new Note or Notes pursuant to Section 13.2. The Company will afford the benefits
of this Section 14.2 to any Institutional Investor that is the direct or
indirect transferee of any Note purchased by any Purchaser under this Agreement
and that has made the same agreement relating to such Note as such Purchaser has
made in this Section 14.2.
SECTION 15. EXPENSES, ETC.
Section 15.1. Transaction Expenses. Whether or not the transactions
contemplated hereby are consummated, the Company will pay all costs and expenses
(including reasonable attorneys' fees of the Purchasers' special counsel,
▇▇▇▇▇▇▇ and ▇▇▇▇▇▇, incurred by any Purchaser or holder of a Note in connection
with such transactions and in connection with any amendments, waivers or
consents under or in respect of this Agreement, the Guaranty Agreement, the
Intercreditor Agreement or the Notes (whether or not such amendment, waiver or
consent becomes effective), including, without limitation: (a) the costs and
expenses incurred in enforcing or defending (or determining whether or how to
enforce or defend) any rights under this Agreement, the Guaranty Agreement, the
Intercreditor Agreement or the Notes or in responding to any subpoena or other
legal process or informal investigative demand issued in connection with this
Agreement, the Guaranty Agreement, the Intercreditor Agreement or the Notes, or
by reason of being a holder of any Note, and (b) the costs and expenses,
including financial advisors' fees, incurred in connection with the insolvency
or bankruptcy of the Company or any Subsidiary or in connection with any
work-out or restructuring of the transactions contemplated hereby and by the
Notes. The Company will pay, and will save each Purchaser of a Note harmless
from, all claims in respect of any fees, costs or expenses, if any, of brokers
and finders (other than those retained by a Purchaser).
Section 15.2. Survival. The obligations of the Company under this
Section 15 will survive the payment or transfer of any Note, the enforcement,
amendment or waiver of any provision of this Agreement or the Notes, and the
termination of this Agreement.
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Otter Tail Corporation Note Purchase Agreement
SECTION 16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.
All representations and warranties contained herein shall survive the
execution and delivery of this Agreement and the Notes, the purchase or transfer
by a Purchaser of any Note or portion thereof or interest therein and the
payment of any Note, and may be relied upon by any subsequent holder of a Note,
regardless of any investigation made at any time by or on behalf of such
Purchaser or any other holder of a Note. All statements contained in any
certificate or other instrument delivered by or on behalf of the Company
pursuant to this Agreement shall be deemed representations and warranties of the
Company under this Agreement. Subject to the preceding sentence, this Agreement
and the Notes embody the entire agreement and understanding between the
Purchasers and the Company and supersede all prior agreements and understandings
relating to the subject matter hereof.
SECTION 17. AMENDMENT AND WAIVER.
Section 17.1. Requirements. This Agreement and the Notes may be
amended, and the observance of any term hereof or of the Notes may be waived
(either retroactively or prospectively), with (and only with) the written
consent of the Company and the Required Holders, except that (a) no amendment or
waiver of any of the provisions of Section 1, 2, 3, 4, 5, 6 or 21 hereof, or any
defined term (as it is used therein), will be effective as to a Purchaser unless
consented to by such Purchaser in writing, and (b) no such amendment or waiver
may, without the written consent of the holder of each Note at the time
outstanding affected thereby, (i) subject to the provisions of Section 12
relating to acceleration or rescission, change the amount or time of any
prepayment or payment of principal of, or reduce the rate or change the time of
payment or method of computation of interest or of the Make-Whole Amount on, the
Notes, (ii) change the percentage of the principal amount of the Notes the
holders of which are required to consent to any such amendment or waiver, or
(iii) amend any of Sections 8, 9.6, 11(a), 11(b), 12, 17 or 20.
Section 17.2. Solicitation of Holders of Notes.
(a) Solicitation. The Company will provide each holder of the Notes
(irrespective of the amount of Notes then owned by it) with sufficient
information, sufficiently far in advance of the date a decision is required, to
enable such holder to make an informed and considered decision with respect to
any proposed amendment, waiver or consent in respect of any of the provisions
hereof or of the Notes. The Company will deliver executed or true and correct
copies of each amendment, waiver or consent effected pursuant to the provisions
of this Section 17 to each holder of outstanding Notes promptly following the
date on which it is executed and delivered by, or receives the consent or
approval of, the requisite holders of Notes.
(b) Payment. The Company will not directly or indirectly pay or
cause to be paid any remuneration, whether by way of supplemental or additional
interest, fee or otherwise, or grant any security, to any holder of Notes as
consideration for or as an inducement to the entering into by any holder of
Notes of any waiver or amendment of any of the terms and provisions hereof
unless such remuneration is concurrently paid, or security is concurrently
granted, on the same
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Otter Tail Corporation Note Purchase Agreement
terms, ratably to each holder of Notes then outstanding whether or not such
holder consented to such waiver or amendment.
Section 17.3. Binding Effect, etc. Any amendment or waiver consented to
as provided in this Section 17 applies equally to all holders of Notes and is
binding upon them and upon each future holder of any Note and upon the Company
without regard to whether such Note has been marked to indicate such amendment
or waiver. No such amendment or waiver will extend to or affect any obligation,
covenant, agreement, Default or Event of Default not expressly amended or waived
or impair any right consequent thereon. No course of dealing between the Company
and the holder of any Note nor any delay in exercising any rights hereunder or
under any Note shall operate as a waiver of any rights of any holder of such
Note. As used herein, the term "this Agreement" and references thereto shall
mean this Agreement as it may from time to time be amended or supplemented.
Section 17.4. Notes Held by Company, etc. Solely for the purpose of
determining whether the holders of the requisite percentage of the aggregate
principal amount of Notes then outstanding approved or consented to any
amendment, waiver or consent to be given under this Agreement or the Notes, or
have directed the taking of any action provided herein or in the Notes to be
taken upon the direction of the holders of a specified percentage of the
aggregate principal amount of Notes then outstanding, Notes directly or
indirectly owned by the Company or any of its Affiliates shall be deemed not to
be outstanding.
SECTION 18. NOTICES.
All notices and communications provided for hereunder shall be in
writing and sent (a) by telefacsimile if the sender on the same day sends a
confirming copy of such notice by a recognized overnight delivery service
(charges prepaid), or (b) by registered or certified mail with return receipt
requested (postage prepaid), or (c) by a recognized overnight delivery service
(with charges prepaid). Any such notice must be sent:
(i) if to a Purchaser or a Purchaser's nominee, to such
Purchaser or it at the address specified for such communications in
Schedule A, or at such other address as such Purchaser or it shall
have specified to the Company in writing,
(ii) if to any other holder of any Note, to such holder at
such address as such other holder shall have specified to the
Company in writing, or
(iii) if to the Company, to the Company at its address set
forth at the beginning hereof to the attention of Chief Financial
Officer, or at such other address as the Company shall have
specified to the holder of each Note in writing.
Notices under this Section 18 will be deemed given only when actually received.
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▇▇▇▇▇ ▇▇▇▇ Corporation Note Purchase Agreement
SECTION 19. REPRODUCTION OF DOCUMENTS.
This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by any Purchaser at the Closing (except the
Notes themselves), and (c) financial statements, certificates and other
information previously or hereafter furnished to such Purchaser, may be
reproduced by such Purchaser by any photographic, photostatic, microfilm,
microcard, miniature photographic or other similar process and such Purchaser
may destroy any original document so reproduced. The Company agrees and
stipulates that, to the extent permitted by applicable law, any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by such Purchaser in the
regular course of business) and any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence. This
Section 19 shall not prohibit the Company or any other holder of Notes from
contesting any such reproduction to the same extent that it could contest the
original, or from introducing evidence to demonstrate the inaccuracy of any such
reproduction.
SECTION 20. CONFIDENTIAL INFORMATION.
For the purposes of this Section 20, "Confidential Information" means
information delivered to a Purchaser by or on behalf of the Company or any
Subsidiary in connection with the transactions contemplated by or otherwise
pursuant to this Agreement that is proprietary in nature and that was clearly
marked or labeled or otherwise adequately identified when received by such
Purchaser as being confidential information of the Company or such Subsidiary,
provided that such term does not include information that (a) was publicly known
or otherwise known to such Purchaser prior to the time of such disclosure, (b)
subsequently becomes publicly known through no act or omission by such Purchaser
or any Person acting on such Purchaser's behalf, (c) otherwise becomes known to
such Purchaser other than through disclosure by the Company or any Subsidiary or
(d) constitutes financial statements delivered to such Purchaser under Section
7.1 that are otherwise publicly available. Each Purchaser will maintain the
confidentiality of such Confidential Information in accordance with procedures
adopted by such Purchaser in good faith to protect confidential information of
third parties delivered to such Purchaser, provided that such Purchaser may
deliver or disclose Confidential Information to (i) such Purchaser's directors,
officers, employees, agents, attorneys and affiliates (to the extent such
disclosure reasonably relates to the administration of the investment
represented by such Purchaser's Notes), (ii) such Purchaser's financial advisors
and other professional advisors who agree to hold confidential the Confidential
Information substantially in accordance with the terms of this Section 20, (iii)
any other holder of any Note, (iv) any Institutional Investor to which such
Purchaser sells or offers to sell such Note or any part thereof or any
participation therein (if such Person has agreed in writing prior to its receipt
of such Confidential Information to be bound by the provisions of this Section
20), (v) any Person from which such Purchaser offers to purchase any security of
the Company (if such Person has agreed in writing prior to its receipt of such
Confidential Information to be bound by the provisions of this Section 20), (vi)
any federal or state regulatory authority having jurisdiction over such
Purchaser, (vii) the National Association of Insurance Commissioners or any
similar organization, or any nationally recognized rating agency that requires
access to information about such Purchaser's investment portfolio, or
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Otter Tail Corporation Note Purchase Agreement
(viii) any other Person to which such delivery or disclosure may be necessary or
appropriate (w) to effect compliance with any law, rule, regulation or order
applicable to such Purchaser, (x) in response to any subpoena or other legal
process, (y) in connection with any litigation to which such Purchaser is a
party or (z) if an Event of Default has occurred and is continuing, to the
extent such Purchaser may reasonably determine such delivery and disclosure to
be necessary or appropriate in the enforcement or for the protection of the
rights and remedies under such Purchaser's Notes and this Agreement. Each holder
of a Note, by its acceptance of a Note, will be deemed to have agreed to be
bound by and to be entitled to the benefits of this Section 20 as though it were
a party to this Agreement. On reasonable request by the Company in connection
with the delivery to any holder of a Note of information required to be
delivered to such holder under this Agreement or requested by such holder (other
than a holder that is a party to this Agreement or its nominee), such holder
will enter into an agreement with the Company embodying the provisions of this
Section 20.
SECTION 21. SUBSTITUTION OF PURCHASER.
Each Purchaser shall have the right to substitute any one of such
Purchaser's Affiliates as the purchaser of the Notes that such Purchaser has
agreed to purchase hereunder, by written notice to the Company, which notice
shall be signed by both such Purchaser and such Affiliate, shall contain such
Affiliate's agreement to be bound by this Agreement and shall contain a
confirmation by such Affiliate of the accuracy with respect to it of the
representations set forth in Section 6. Upon receipt of such notice, wherever
the word "you" is used in this Agreement (other than in this Section 21), such
word shall be deemed to refer to such Affiliate in lieu of such Purchaser. In
the event that such Affiliate is so substituted as a purchaser hereunder and
such Affiliate thereafter transfers to a Purchaser all of the Notes then held by
such Affiliate, upon receipt by the Company of notice of such transfer, wherever
the word "you" is used in this Agreement (other than in this Section 21), such
word shall no longer be deemed to refer to such Affiliate, but shall refer to
such Purchaser, and such Purchaser shall have all the rights of an original
holder of the Notes under this Agreement.
SECTION 22. MISCELLANEOUS.
Section 22.1. Successors and Assigns. All covenants and other
agreements contained in this Agreement by or on behalf of any of the parties
hereto bind and inure to the benefit of their respective successors and assigns
(including, without limitation, any subsequent holder of a Note) whether so
expressed or not.
Section 22.2. Payments Due on Non-Business Days. Anything in this
Agreement or the Notes to the contrary notwithstanding, any payment of principal
of or Make-Whole Amount or interest on any Note that is due on a date other than
a Business Day shall be made on the next succeeding Business Day without
including the additional days elapsed in the computation of the interest payable
on such next succeeding Business Day.
Section 22.3. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such
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Otter Tail Corporation Note Purchase Agreement
prohibition or unenforceability without invalidating the remaining provisions
hereof, and any such prohibition or unenforceability in any jurisdiction shall
(to the full extent permitted by law) not invalidate or render unenforceable
such provision in any other jurisdiction.
Section 22.4. Construction. Each covenant contained herein shall be
construed (absent express provision to the contrary) as being independent of
each other covenant contained herein, so that compliance with any one covenant
shall not (absent such an express contrary provision) be deemed to excuse
compliance with any other covenant. Where any provision herein refers to action
to be taken by any Person, or which such Person is prohibited from taking, such
provision shall be applicable whether such action is taken directly or
indirectly by such Person.
Section 22.5. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be an original but all of which
together shall constitute one instrument. Each counterpart may consist of a
number of copies hereof, each signed by less than all, but together signed by
all, of the parties hereto.
Section 22.6. Submission to Jurisdiction. The Company hereby
irrevocably submits and consents to the jurisdiction of the federal court
located within the County of New York, State of New York (or if such court lacks
jurisdictions, the State courts located therein), and irrevocably agrees that
all actions or proceedings relating to this Agreement and the Notes may 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 court and waives personal service of any and all process upon it,
and consents that all such service of process be made by delivery to it at the
address of the Company set forth in Section 18 above.
Section 22.7. Governing Law. This Agreement shall be construed and
enforced in accordance with, and the rights of the parties shall be governed by,
the law of the State of New York excluding choice-of-law principles of the law
of such State that would require the application of the laws of a jurisdiction
other than such State.
* * * * *
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Otter Tail Corporation Note Purchase Agreement
If you are in agreement with the foregoing, please sign the form of
agreement on the accompanying counterpart of this Agreement and return it to the
Company, whereupon the foregoing shall become a binding agreement between you
and the Company.
Very truly yours,
OTTER TAIL CORPORATION
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: C. F. O. and Treasurer
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Otter Tail Corporation Note Purchase Agreement
The foregoing is hereby agreed to as of the date thereof.
THE PRUDENTIAL INSURANCE COMPANY OF
AMERICA
By /s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
Otter Tail Corporation Note Purchase Agreement
The foregoing is hereby agreed to as of the date thereof.
HARTFORD LIFE INSURANCE COMPANY
By: Prudential Private Placement Investors,
L.P., as Investment Advisor
By: Prudential Private Placement Investors,
Inc., General Partner
By /s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
Otter Tail Corporation Note Purchase Agreement
The foregoing is hereby agreed to as of the date thereof.
MEDICA HEALTH PLAN
By: Prudential Private Placement Investors,
L.P., as Investment Advisor
By: Prudential Private Placement Investors,
Inc., General Partner
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇
---------------------------------------
Vice President
Otter Tail Corporation Note Purchase Agreement
The foregoing is hereby agreed to as of the date thereof.
GENERAL ELECTRIC CAPITAL ASSURANCE
COMPANY
By /s/ ▇▇▇. M. Lucia
-----------------
Name: ▇▇▇ ▇. ▇▇▇▇▇
Title: Investment Officer
Otter Tail Corporation Note Purchase Agreement
The foregoing is hereby agreed to as of the date thereof.
▇▇ ▇▇▇▇▇▇ LIFE INSURANCE COMPANY
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chief Investment Officer
Otter Tail Corporation Note Purchase Agreement
The foregoing is hereby agreed to as of the date thereof.
GE CAPITAL LIFE ASSURANCE COMPANY OF
NEW YORK
By /s/ ▇▇▇ ▇. ▇▇▇▇▇
--------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇
Title: Investment Officer
Otter Tail Corporation Note Purchase Agreement
The foregoing is hereby agreed to as of the date thereof.
FIRST COLONY LIFE INSURANCE COMPANY
By /s/ ▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇
Title: Assistant Vice President and
And Investment Officer
Otter Tail Corporation Note Purchase Agreement
The foregoing is hereby agreed to as of the date thereof.
TREASURER OF THE STATE OF SOUTH CAROLINA
SOUTH CAROLINA RETIREMENT SYSTEM
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇.
----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇.
Title: State Treasurer of South Carolina
Otter Tail Corporation Note Purchase Agreement
The foregoing is hereby agreed to as of the date thereof.
COUNTRY LIFE INSURANCE COMPANY
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Investment Officer
INFORMATION RELATING TO PURCHASERS
PRINCIPAL AMOUNT
NAME AND ADDRESS OF NOTES TO BE
OF PURCHASER PURCHASED
THE PRUDENTIAL INSURANCE COMPANY $21,500,000
OF AMERICA
c/o Prudential Capital Group
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: Managing Director
Payments
All payments on or in respect of the Notes to be by bank wire transfer of
Federal or other immediately available funds (identifying each payment as "Otter
Tail Corporation, 6.63% Senior Notes due December 1, 2011, !INV! 7784!, PPN
689648 B# 9, principal, Make-Whole Amount or interest") to:
Account Number ▇▇▇-▇▇▇▇-▇▇▇
The Bank of New York
New York, New York
ABA #▇▇▇-▇▇▇-▇▇▇
Notices
All notices and communications to be addressed as first provided above, except
notices with respect to payments, and written confirmation of each such payment,
to be addressed:
The Prudential Insurance Company of America
c/o Investment Operations Group
Gateway Center Two, 10th Floor
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Manager
Recipient of telephonic prepayment notices with respect to Notes:
Manager, Trade Management Group
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Name of Nominee in which Notes are to be issued: None
Taxpayer I.D. Number: ▇▇-▇▇▇▇▇▇▇
SCHEDULE A
(to Note Purchase Agreement)
Otter Tail Corporation Note Purchase Agreement
PRINCIPAL AMOUNT
NAME AND ADDRESS OF NOTES TO BE
OF PURCHASER PURCHASED
THE PRUDENTIAL INSURANCE COMPANY $7,000,000
OF AMERICA
c/o Prudential Capital Group
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: Managing Director
Payments
All payments on or in respect of the Notes to be by bank wire transfer of
Federal or other immediately available funds (identifying each payment as "Otter
Tail Corporation, 6.63% Senior Notes due December 1, 2011, !INV 7784!, PPN
689648 B# 9, principal, Make-Whole Amount or interest") to:
Account Number ▇▇▇-▇▇▇▇-▇▇▇
The Bank of New York
New York, New York
ABA #▇▇▇-▇▇▇-▇▇▇
Notices
All notices and communications to be addressed as first provided above, except
notices with respect to payments, and written confirmation of each such payment,
to be addressed:
The Prudential Insurance Company of America
c/o Investment Operations Group
Gateway Center Two, 10th Floor
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Manager
Recipient of telephonic prepayment notices with respect to Notes:
Manager, Trade Management Group
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Name of Nominee in which Notes are to be issued: None
Taxpayer I.D. Number: ▇▇-▇▇▇▇▇▇▇
A-2
Otter Tail Corporation Note Purchase Agreement
PRINCIPAL AMOUNT
NAME AND ADDRESS OF NOTES TO BE
OF PURCHASER PURCHASED
HARTFORD LIFE INSURANCE COMPANY $5,000,000
c/o Prudential Private Placement Investors, L.P.
Attn: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇, Senior Vice President
4 Gateway Center, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Payments
All payments on or in respect of the Notes to be by bank wire transfer of
Federal or other immediately available funds (identifying each payment as "Otter
Tail Corporation, 6.63% Senior Notes due December 1, 2011, PPN 689648 B# 9,
principal, Make-Whole Amount or interest") to:
Chase Manhattan Bank
▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
ABA #▇▇▇▇▇▇▇▇▇
Chase NYC/Cust
A/C #▇▇▇-▇-▇▇▇▇▇▇ for F/C/T for domestic issuers use: G 08965 CRD
Notices
All notices and communications to be addressed as first provided above, except
notices with respect to payments, and written confirmation of each such payment,
to be addressed:
Hartford Investment Management Company
▇/▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇/8876
Name of Nominee in which Notes are to be issued: None
Taxpayer I.D. Number: ▇▇-▇▇▇▇▇▇▇
A-3
Otter Tail Corporation Note Purchase Agreement
PRINCIPAL AMOUNT
NAME AND ADDRESS OF NOTES TO BE
OF PURCHASER PURCHASED
MEDICA HEALTH PLAN $1,500,000
c/o Prudential Private Placement Investors, Inc.
Four ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Institutional Asset Management
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Payments
All payments on or in respect of the Notes to be by bank wire transfer of
Federal or other immediately available funds (identifying each payment as "Otter
Tail Corporation, 6.63% Senior Notes due December 1, 2011, PPN 689648 B# 9,
principal, Make-Whole Amount or interest") to:
Federal Reserve Bank of Boston
ABA No. ▇▇▇▇▇▇▇▇▇
DDA No. 125261
For: Allina Medica Health Plan/AHHF5002082
Attn: MBS Income-Cost Center 1253
Notices
All notices and communications, including notices with respect to payments and
written confirmation of each such payment, to be addressed as first provided
above.
Name of Nominee in which Notes are to be issued: None
Taxpayer I.D. Number: ▇▇-▇▇▇▇▇▇▇
A-4
Otter Tail Corporation Note Purchase Agreement
PRINCIPAL AMOUNT
NAME AND ADDRESS OF NOTES TO BE
OF PURCHASER PURCHASED
GENERAL ELECTRIC CAPITAL ASSURANCE COMPANY $13,000,000
c/o GE Financial Assurance
Account: General Electric Capital Assurance Company
Two Union Square, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Investment Department, Private Placements
Phone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Fax Number: (▇▇▇) ▇▇▇-▇▇▇▇
Payments
All payments on or in respect of the Notes to be by bank wire transfer of
Federal or other immediately available funds (identifying each payment as "Otter
Tail Corporation, 6.63% Senior Notes due December 1, 2011, PPN 689648 B# 9,
principal, premium or interest") to:
Bankers Trust Company
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
SWIFT Code: BKTR US 33
ABA #▇▇▇▇▇▇▇▇▇
Account Number ▇▇-▇▇▇-▇▇▇
FCC #097833
Notices
All notices with respect to payments and written confirmation of each such
payment, to be addressed:
GE Financial Assurance
Account: General Electric Capital Assurance Company
Two Union Square, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Investment Accounting
Phone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Fax Number: (▇▇▇) ▇▇▇-▇▇▇▇
All other notices and communications (including original note agreement,
conformed copy of the note agreement, amendment requests, financial statements)
to be addressed as first provided above.
Name of Nominee in which Notes are to be issued: ▇▇▇▇▇▇▇ & CO.
Taxpayer I.D. Number: ▇▇-▇▇▇▇▇▇▇
A-5
Otter Tail Corporation Note Purchase Agreement
PRINCIPAL AMOUNT
NAME AND ADDRESS OF NOTES TO BE
OF PURCHASER PURCHASED
▇▇ ▇▇▇▇▇▇ LIFE INSURANCE COMPANY $10,000,000
c/o GE Financial Assurance
Account: ▇▇ ▇▇▇▇▇▇ Life Insurance Company (VIP Account)
Two Union Square, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Investment Department, Private Placements
Phone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Fax Number: (▇▇▇) ▇▇▇-▇▇▇▇
Payments
All payments on or in respect of the Notes to be by bank wire transfer of
Federal or other immediately available funds (identifying each payment as "Otter
Tail Corporation, 6.63% Senior Notes due December 1, 2011, PPN 689648 B# 9,
principal, premium or interest") to:
Bankers Trust Company
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
SWIFT Code: BKTR US 33
ABA #▇▇▇▇▇▇▇▇▇
Account Number ▇▇-▇▇▇-▇▇▇
FCC #098775
Notices
All notices with respect to payments and written confirmation of each such
payment, to be addressed:
GE Financial Assurance
Account: ▇▇ ▇▇▇▇▇▇ Life Insurance Company (VIP Account)
Two Union Square, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Investment Accounting
Phone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Fax Number: (▇▇▇) ▇▇▇-▇▇▇▇
All other notices and communications (including original note agreement,
conformed copy of the note agreement, amendment requests, financial statements)
to be addressed as first provided above.
Name of Nominee in which Notes are to be issued: ▇▇▇▇▇▇▇ & CO.
Taxpayer I.D. Number: None (Foreign Company)
A-6
Otter Tail Corporation Note Purchase Agreement
PRINCIPAL AMOUNT
NAME AND ADDRESS OF NOTES TO BE
OF PURCHASER PURCHASED
GE CAPITAL LIFE ASSURANCE COMPANY OF NEW YORK $7,000,000
c/o GE Financial Assurance
Account: GE Capital Life Assurance Company of New York
Two Union Square, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Investment Department, Private Placements
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile Number: (▇▇▇) ▇▇▇-▇▇▇▇
Payments
All payments on or in respect of the Notes to be by bank wire transfer of
Federal or other immediately available funds (identifying each payment as "Otter
Tail Corporation, 6.63% Senior Notes due December 1, 2011, PPN 689648 B# 9,
principal, premium or interest") to:
Bankers Trust Company
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
SWIFT Code: BKTR US 33
ABA #▇▇▇▇▇▇▇▇▇
Account Number ▇▇-▇▇▇-▇▇▇
FCC #097836
Notices
All notices with respect to payments and written confirmation of each such
payment to be addressed:
GE Financial Assurance
Account: GE Capital Life Assurance Company of New York
Two Union Square, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Investment Accounting
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile Number: (▇▇▇) ▇▇▇-▇▇▇▇
All other notices and communications (including original note agreement,
conformed copy of the note agreement, amendment requests, financial statements)
to be addressed as first provided above.
Name of Nominee in which Notes are to be issued: ▇▇▇▇▇▇▇ & CO.
Taxpayer I.D. Number: ▇▇-▇▇▇▇▇▇▇
A-7
Otter Tail Corporation Note Purchase Agreement
PRINCIPAL AMOUNT
NAME AND ADDRESS OF NOTES TO BE
OF PURCHASER PURCHASED
FIRST COLONY LIFE INSURANCE COMPANY $5,000,000
c/o GE Financial Assurance
Account: First Colony Life Insurance Company
Two Union Square, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Investment Department, Private Placements
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile Number: (▇▇▇) ▇▇▇-▇▇▇▇
Payments
All payments on or in respect of the Notes to be by bank wire transfer of
Federal or other immediately available funds (identifying each payment as "Otter
Tail Corporation, 6.63% Senior Notes due December 1, 2011, PPN 689648 B# 9,
principal, premium or interest") to:
Bankers Trust Company
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
SWIFT Code: BKTR US 33
ABA #▇▇▇▇▇▇▇▇▇
Account Number ▇▇-▇▇▇-▇▇▇
FCC #098069
Ref: security description, coupon, maturity, PPN #, identify principal
or interest
Notices
All notices with respect to payments and written confirmation of each such
payment to be addressed:
GE Financial Assurance
Account: First Colony Life Insurance Company
Two Union Square, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Investment Accounting
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile Number: (▇▇▇) ▇▇▇-▇▇▇▇
All other notices and communications (including original note agreement,
conformed copy of the note agreement, amendment requests, financial statements)
to be addressed as first provided above.
Name of Nominee in which Notes are to be issued: ▇▇▇▇▇▇▇ & CO.
Taxpayer I.D. Number: ▇▇-▇▇▇▇▇▇▇
A-8
Otter Tail Corporation Note Purchase Agreement
PRINCIPAL AMOUNT
NAME AND ADDRESS OF NOTES TO BE
OF PURCHASER PURCHASED
TREASURER OF THE STATE OF SOUTH CAROLINA $15,000,000
SOUTH CAROLINA RETIREMENT SYSTEM
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Payments
All payments on or in respect of the Notes to be by bank wire transfer of
Federal or other immediately available funds (identifying each payment as "Otter
Tail Corporation, 6.63% Senior Notes due December 1, 2011, PPN 689648 B# 9,
principal, premium or interest") to:
Bank of New York
ABA #0210000018
BK=IOC 363
S C Retirement System/862164
Notices
All notices and communications, including notices with respect to payments and
written confirmation of each such payment, to be addressed as first provided
above.
Name of Nominee in which Notes are to be issued: None
Taxpayer I.D. Number: ▇▇-▇▇▇▇▇▇▇
A-9
Otter Tail Corporation Note Purchase Agreement
PRINCIPAL AMOUNT
NAME AND ADDRESS OF NOTES TO BE
OF PURCHASER PURCHASED
COUNTRY LIFE INSURANCE COMPANY $5,000,000
c/o Country Trust Bank Investment Management
▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Payments
All payments on or in respect of the Notes to be by bank wire transfer of
Federal or other immediately available funds (identifying each payment as "Otter
Tail Corporation, 6.63% Senior Notes due December 1, 2011, PPN 689648 B# 9,
principal, premium or interest") to:
Northern Trust Chgo/Trust
ABA Number ▇▇▇▇▇▇▇▇▇
Wire Account Number 5186041000
For Further Credit to: 26-02712
Account Name: Country Life Insurance Company
Representing P & I on (list security)
Notices
All notices and communications, including notices with respect to payments and
written confirmation of each such payment, to be addressed as first provided
above with a copy to:
Country Life Insurance Company
Attention: Karent Brand (Investment Accounting)
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Name of Nominee in which Notes are to be issued: None
Taxpayer I.D. Number: ▇▇-▇▇▇▇▇▇▇
A-10
DEFINED TERMS
Where the character or amount of any asset or liability or item of
income or expense is required to be determined or any consolidation or other
accounting computation is required to be made for the purposes of this
Agreement, the same shall be done in accordance with GAAP, to the extent
applicable, except where such principles are inconsistent with the express
requirements of this Agreement.
Where any provision in this Agreement refers to action to be taken by
any Person, or which such Person is prohibited from taking, such provision shall
be applicable whether the action in question is taken directly or indirectly by
such Person.
As used herein, the following terms have the respective meanings set
forth below or set forth in the Section hereof following such term:
"Acceptable Rating" shall mean in the case of ▇▇▇▇▇'▇ a rating of
"Baa3" (or the then current equivalent thereof) or better and in the case of S&P
a rating of "BBB-" (or the then current equivalent thereof) or better and in the
case of any other Designated Rating Agency, a rating equivalent to such
Acceptable Rating of ▇▇▇▇▇'▇ or S&P.
"Additional Subsidiary Guarantor" is defined in Section 9.8.
"Asset Disposition" means any Transfer except:
(a) any
(i) Transfer from a Subsidiary to the Company or a
Wholly-Owned Subsidiary;
(ii) Transfer from the Company to a Wholly-Owned
Subsidiary; and
(iii) Transfer from the Company to a Subsidiary (other
than a Wholly-Owned Subsidiary) or from a Subsidiary to
another Subsidiary (other than a Wholly-Owned Subsidiary),
which in either case is for Fair Market Value,
so long as immediately before and immediately after the consummation of
any such Transfer and after giving effect thereto, no Default or Event
of Default exists; and
(b) any Transfer made in the ordinary course of business and
involving only property that is either (i) inventory held for sale or
(ii) equipment, fixtures, supplies or materials no longer required in
the operation of the business of the Company or any of its Subsidiaries
or that is obsolete.
"Affiliate" means, at any time, and with respect to any Person, any
other Person that at such time directly or indirectly through one or more
intermediaries Controls, or is Controlled by, or is under common Control with,
such first Person. As used in this definition, "Control" means
SCHEDULE B
(to Note Purchase Agreement)
Otter Tail Corporation Note Purchase Agreement
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise. Unless the context
otherwise clearly requires, any reference to an "Affiliate" is a reference to an
Affiliate of the Company.
"Bank Closing Date" shall have the meaning set forth in Section 9.9.
"Bonds" shall mean any Bonds issued under the Indenture.
"Bank Credit Agreement" shall mean the Credit Agreement dated as of
October 31, 1997 among the Mid-States Development, Inc. (now Varistar) and First
Bank National Association, the Letter Agreement effective June 1, 1990 between
the Company and U.S. Bank National Association and the Letter Agreement dated as
of May 31, 2001 between the Company and The Bank of New York, each as amended
from time to time, any replacement, additional or successor agreement or
agreements thereto or any other bank credit facility or bank credit facilities
in effect from time to time with banks or other lending institutions.
"Business Day" means (a) for the purposes of Section 8.7 only, any day
other than a Saturday, a Sunday or a day on which commercial banks in New York,
New York are required or authorized to be closed, and (b) for the purposes of
any other provision of this Agreement, any day other than a Saturday, a Sunday
or a day on which commercial banks in Minneapolis, Minnesota or New York, New
York are required or authorized to be closed.
"Capital Lease" means, at any time, a lease with respect to which the
lessee is required concurrently to recognize the acquisition of an asset and the
incurrence of a liability in accordance with GAAP.
"Capital Lease Obligation" means, with respect to any Person and a
Capital Lease, the amount of the obligation of such Person as the lessee under
such Capital Lease which would, in accordance with GAAP, appear as a liability
on a balance sheet of such Person.
"Closing" is defined in Section 3.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and the rules and regulations promulgated thereunder from time to time.
"Company" means Otter Tail Corporation, a Minnesota corporation.
"Confidential Information" is defined in Section 20.
"Consolidated Assets" means, at any time, the total assets of the
Company and its Subsidiaries which would be shown as assets on a consolidated
balance sheet of the Company and its Subsidiaries as of such time prepared in
accordance with GAAP, after eliminating all amounts properly attributable to
minority interests, if any, in the stock and surplus of Subsidiaries.
B-2
Otter Tail Corporation Note Purchase Agreement
"Consolidated Debt" means, as of any date of determination, the total
of all Debt of the Company and its Subsidiaries outstanding on such date, after
eliminating all offsetting debits and credits between the Company and its
Subsidiaries and all other items required to be eliminated in the course of the
preparation of consolidated financial statements of the Company and its
Subsidiaries in accordance with GAAP.
"Consolidated Income Available for Interest Charges" means, with
respect to any period, Consolidated Net Income for such period plus all amounts
deducted in the computation thereof on account of (a) Interest Charges and (b)
taxes imposed on or measured by income or excess profits.
"Consolidated Net Income" means, with reference to any period, the net
income (or loss) of the Company and its Subsidiaries for such period (taken as a
cumulative whole), as determined in accordance with GAAP, after eliminating all
offsetting debits and credits between the Company and its Subsidiaries and all
other items required to be eliminated in the course of the preparation of
consolidated financial statements of the Company and its Subsidiaries in
accordance with GAAP, provided that there shall be excluded:
(a) the income (or loss) of any Person accrued prior to the
date it becomes a Subsidiary or is merged into or consolidated with the
Company or a Subsidiary, and the income (or loss) of any Person,
substantially all of the assets of which have been acquired in any
manner, realized by such other Person prior to the date of acquisition;
(b) the income (or loss) of any Person (other than a
Subsidiary) in which the Company or any Subsidiary has an ownership
interest, except to the extent that any such income has been actually
received by the Company or such Subsidiary in the form of cash
dividends or similar cash distributions; provided, further, that in any
fiscal year there shall not be excluded the first $1,000,000 of any
such income (or loss) which is not so actually received;
(c) the undistributed earnings of any Subsidiary to the
extent that the declaration or payment of dividends or similar
distributions by such Subsidiary is not at the time permitted by the
terms of its charter or any agreement, instrument, judgment, decree,
order, statute, rule or governmental regulation applicable to such
Subsidiary;
(d) any restoration to income of any contingency reserve,
except to the extent that provision for such reserve was made out of
income accrued during such period; provided, further, that in any
fiscal year there shall not be excluded the first $5,000,000 restored
to income from contingency reserves the provisions for which reserves
were made out of income accrued during one or more prior fiscal years;
(e) any aggregate net gain (but not any aggregate net loss)
during such period arising from the sale, conversion, exchange or other
disposition of capital assets (such term to include, without
limitation, (i) all non-current assets and, without duplication, (ii)
the following, whether or not current: all fixed assets, whether
tangible or intangible, all inventory sold in conjunction with the
disposition of fixed assets, and all Securities);
B-3
Otter Tail Corporation Note Purchase Agreement
(f) any gains resulting from any write-up of any assets (but
not any loss resulting from any write-down of any assets);
(g) any gain from the collection of the proceeds of life
insurance policies after payment from such proceeds of any related
liabilities;
(h) any gain arising from the acquisition of any Security, or
the extinguishment, under GAAP, of any Debt, of the Company or any
Subsidiary;
(i) any net income or gain (but not any net loss) during such
period from (i) any change in accounting principles in accordance with
GAAP, (ii) any prior period adjustments resulting from any change in
accounting principles in accordance with GAAP, (iii) any extraordinary
items, or (iv) any discontinued operations or the disposition thereof;
(j) any deferred credit representing the excess of equity in
any Subsidiary at the date of acquisition over the cost of the
investment in such Subsidiary; and
(k) in the case of a successor to the Company by
consolidation or merger or as a transferee of its assets, any earnings
of the successor corporation prior to such consolidation, merger or
transfer of assets.
"Consolidated Net Worth" means, at any time,
(a) the total assets of the Company and its Subsidiaries
which would be shown as assets on a consolidated balance sheet of the Company
and its Subsidiaries as of such time prepared in accordance with GAAP, after
eliminating all amounts properly attributable to minority interests, if any, in
the stock and surplus of Subsidiaries, minus
(b) the total liabilities of the Company and its Subsidiaries
which would be shown as liabilities on a consolidated balance sheet of the
Company and its Subsidiaries as of such time prepared in accordance with GAAP.
"Consolidated Total Capitalization" means, at any time, the sum of
Consolidated Net Worth and Consolidated Debt.
"Debt" means, with respect to any Person, without duplication,
(a) its liabilities for borrowed money and its redemption
obligations in respect of Redeemable Preferred Stock;
(b) its liabilities for the deferred purchase price of
property acquired by such Person (excluding accounts payable arising in
the ordinary course of business but including, without limitation, all
liabilities created or arising under any conditional sale or other
title retention agreement with respect to any such property);
B-4
Otter Tail Corporation Note Purchase Agreement
(c) its Capital Lease Obligations;
(d) all liabilities for borrowed money secured by any Lien
with respect to any property owned by such Person (whether or not it
has assumed or otherwise become liable for such liabilities); and
(e) any Guaranty of such Person with respect to liabilities
of a type described in any of clauses (a) through (d) hereof.
Debt of any Person shall include all obligations of such Person of the
character described in clauses (a) through (e) to the extent such
Person remains legally liable in respect thereof notwithstanding that
any such obligation is deemed to be extinguished under GAAP.
"Debt Prepayment Application" means, with respect to any Transfer of
property, the application by the Company or its Subsidiaries of cash in an
amount equal to the Net Proceeds Amount with respect to such Transfer to pay
Debt of the Company, provided that in the course of making such application, the
Company shall give to each holder of Notes a written offer to prepay each
outstanding Note held by such holder at par in accordance with the following
provisions in a principal amount equal to the Ratable Portion of such Note. If
any holder of a Note fails to accept such an offer of prepayment, then for
purposes of the preceding sentence only the Company nevertheless shall be deemed
to have paid Debt of the Company in an amount equal to the Ratable Portion for
such Note. The offer to prepay shall specify a date for prepayment (the
"Proposed Prepayment Date") not less than 30 days nor more than 45 days after
the date of such offer. A holder of Notes may accept the offer to prepay by
causing a notice of such acceptance to be delivered to the Company not later
than 15 days after receipt by such holder of such offer, and a failure by a
holder of Notes to accept an offer shall constitute a rejection of such offer by
such holder. Upon delivery of an acceptance by the holder as set forth above of
an offer by the Company to prepay such Notes, the Notes shall become due and
payable at par on the Proposed Prepayment Date for such Notes. "Ratable Portion"
for any Note means an amount equal to the product of (x) the Net Proceeds Amount
being so applied to the payment of Debt of the Company multiplied by (y) a
fraction of the numerator of which is the outstanding principal amount of such
Note and the denominator of which is the aggregate principal amount of Debt of
the Company.
"Default" means an event or condition the occurrence or existence of
which would, with the lapse of time or the giving of notice or both, become an
Event of Default.
"Default Rate" means that rate of interest that is the greater of (i)
2% per annum above the rate of interest stated in clause (a) of the first
paragraph of the Notes or (ii) 2% over the rate of interest publicly announced
by U.S. Bank, National Association in Minneapolis, Minnesota as its "base" or
"prime" rate.
"Designated Rating Agencies" means ▇▇▇▇▇'▇ and S&P and in the event
that ▇▇▇▇▇'▇ or S&P is not rating Debt of corporations the common shares of
which are publicly traded, then another rating agency or agencies of recognized
national standing.
B-5
Otter Tail Corporation Note Purchase Agreement
"Disposition Value" means, at any time, with respect to any property
(a) in the case of property that does not constitute
Subsidiary Stock, the book value thereof, valued at the time of such
disposition in good faith by the Company, and
(b) in the case of property that constitutes Subsidiary
Stock, an amount equal to that percentage of book value of the assets
of the Subsidiary that issued such stock as is equal to the percentage
that the book value of such Subsidiary Stock represents of the book
value of all of the outstanding capital stock of such Subsidiary
(assuming, in making such calculations, that all Securities convertible
into such capital stock are so converted and giving full effect to all
transactions that would occur or be required in connection with such
conversion) determined at the time of the disposition thereof, in good
faith by the Company.
"Environmental Laws" means any and all Federal, state, local, and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution and the protection of the
environment or the release of any materials into the environment, including but
not limited to those related to hazardous substances or wastes, air emissions
and discharges to waste or public systems.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the rules and regulations promulgated thereunder
from time to time in effect.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that is treated as a single employer together with the Company
under section 414 of the Code.
"Event of Default" is defined in Section 11.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Bonds" is defined in Section 9.6.
"Fair Market Value" means, at any time and with respect to any
property, the sale value of such property that would be realized in an
arm's-length sale at such time between an informed and willing buyer and an
informed and willing seller (neither being under a compulsion to buy or sell).
"GAAP" means generally accepted accounting principles as in effect from
time to time in the United States of America.
"Governmental Authority" means
(a) the government of
B-6
Otter Tail Corporation Note Purchase Agreement
(i) the United States of America or any State or
other political subdivision thereof, or
(ii) any jurisdiction in which the Company or any
Subsidiary conducts all or any part of its business, or which
asserts jurisdiction over any properties of the Company or
any Subsidiary, or
(b) any entity exercising executive, legislative, judicial,
regulatory or administrative functions of, or pertaining to, any such
government.
"Guaranty" means, with respect to any Person, any obligation (except
the endorsement in the ordinary course of business of negotiable instruments for
deposit or collection) of such Person guaranteeing or in effect guaranteeing any
Indebtedness, dividend or other obligation of any other Person in any manner,
whether directly or indirectly, including (without limitation) obligations
incurred through an agreement, contingent or otherwise, by such Person:
(a) to purchase such Indebtedness or obligation or any
property constituting security therefor;
(b) to advance or supply funds (i) for the purchase or
payment of such Indebtedness or obligation, or (ii) to maintain any
working capital or other balance sheet condition or any income
statement condition of any other Person or otherwise to advance or make
available funds for the purchase or payment of such Indebtedness or
obligation;
(c) to lease properties or to purchase properties or services
primarily for the purpose of assuring the owner of such Indebtedness or
obligation of the ability of any other Person to make payment of the
Indebtedness or obligation; or
(d) otherwise to assure the owner of such Indebtedness or
obligation against loss in respect thereof.
In any computation of the Indebtedness or other liabilities of the obligor under
any Guaranty, the Indebtedness or other obligations that are the subject of such
Guaranty shall be assumed to be direct obligations of such obligor.
"Guaranty Agreement" is defined in Section 1.
"Hazardous Material" means any and all pollutants, toxic or hazardous
wastes or any other substances, including all substances listed in or regulated
in any Environmental Law that might pose a hazard to health or safety, the
removal of which may be required or the generation, manufacture, refining,
production, processing, treatment, storage, handling, transportation, transfer,
use, disposal, release, discharge, spillage, seepage, or filtration of which is
or shall be restricted, regulated, prohibited or penalized by any applicable law
(including, without limitation, asbestos, urea formaldehyde foam insulation and
polychlorinated biphenyls).
B-7
Otter Tail Corporation Note Purchase Agreement
"holder" means, with respect to any Note, the Person in whose name such
Note is registered in the register maintained by the Company pursuant to Section
13.1.
"Indebtedness" with respect to any Person means, at any time, without
duplication,
(a) its liabilities for borrowed money and its redemption
obligations in respect of Redeemable Preferred Stock;
(b) its liabilities for the deferred purchase price of
property acquired by such Person (excluding accounts payable arising in
the ordinary course of business but including all liabilities created
or arising under any conditional sale or other title retention
agreement with respect to any such property);
(c) Capital Lease Obligations;
(d) all liabilities for borrowed money secured by any Lien
with respect to any property owned by such Person (whether or not it
has assumed or otherwise become liable for such liabilities);
(e) all its liabilities in respect of letters of credit or
instruments serving a similar function issued or accepted for its
account by banks and other financial institutions (whether or not
representing obligations for borrowed money);
(f) Swaps of such Person; and
(g) any Guaranty of such Person with respect to liabilities
of a type described in any of clauses (a) through (f) hereof.
"Indenture" means the Indenture of Mortgage dated as of July 1, 1936,
as supplemented by 45 supplemental indentures between the Company and U.S. Bank
Trust, National Association, as trustee.
"Institutional Investor" means (a) any original purchaser of a Note,
(b) any holder of a Note holding more than 5% of the aggregate principal amount
of the Notes then outstanding, and (c) any bank, trust company, savings and loan
association or other financial institution, any pension plan, any investment
company, any insurance company, any broker or dealer, or any other similar
financial institution or entity, regardless of legal form.
"Intercreditor Agreement" means the intercreditor agreement in the form
attached hereto as Exhibit 3 which will be executed by the Lenders and the
Noteholders upon the occurrence of the Bank Closing Date.
"Interest Charges" means, with respect to any period, the sum (without
duplication) of the following (in each case, eliminating all offsetting debits
and credits between the Company and its Subsidiaries and all other items
required to be eliminated in the course of the preparation of consolidated
financial statements of the Company and its Subsidiaries in accordance with
B-8
Otter Tail Corporation Note Purchase Agreement
GAAP): (a) all interest in respect of Debt of the Company and its Subsidiaries
(including imputed interest on Capital Lease Obligations) deducted in
determining Consolidated Net Income for such period, (b) all debt discount and
expense amortized or required to be amortized in the determination of
Consolidated Net Income for such period and (c) all dividends paid in respect of
Preferred Stock.
"Interest Charges Coverage Ratio" means, at any time, the ratio of (a)
Consolidated Income Available for Interest Charges for the period of four
consecutive fiscal quarters ending on, or most recently ended prior to, such
time to (b) Interest Charges for such period.
"Lender" means any Lender under the Bank Credit Agreement.
"Lien" means, with respect to any Person, any mortgage, lien, pledge,
charge, security interest or other encumbrance, or any interest or title of any
vendor, lessor, lender or other secured party to or of such Person under any
conditional sale or other title retention agreement or Capital Lease, upon or
with respect to any property or asset of such Person (including in the case of
stock, stockholder agreements, voting trust agreements and all similar
arrangements).
"Make-Whole Amount" is defined in Section 8.7.
"Material" means material in relation to the business, operations,
affairs, financial condition, assets, or properties of the Company and its
Subsidiaries taken as a whole.
"Material Adverse Effect" means a material adverse effect on (a) the
business, operations, affairs, financial condition, assets or properties of the
Company and its Subsidiaries taken as a whole, or (b) the ability of the Company
to perform its obligations under this Agreement and the Notes or any Subsidiary
Guarantor or Additional Subsidiary Guarantor to perform its obligations under
the Guaranty Agreement, or (c) the validity or enforceability of this Agreement
or the Notes or the Guaranty Agreement.
"Memorandum" is defined in Section 5.3.
"▇▇▇▇▇'▇" means ▇▇▇▇▇'▇ Investors Services Inc.
"Multiemployer Plan" means any Plan that is a "multiemployer plan" (as
such term is defined in section 4001(a)(3) of ERISA).
"Net Proceeds Amount" means, with respect to any Transfer of any
property by any Person, an amount equal to the difference of
(a) the aggregate amount of the consideration (valued at the
Fair Market Value of such consideration at the time of the consummation
of such Transfer) received by such Person in respect of such Transfer,
minus
(b) all ordinary and reasonable out-of-pocket costs and
expenses actually incurred by such Person in connection with such
Transfer.
B-9
Otter Tail Corporation Note Purchase Agreement
"Notes" is defined in Section 1.
"Noteholder" means any holder of the Notes.
"Officer's Certificate" means a certificate of a Senior Financial
Officer or of any other officer of the Company whose responsibilities extend to
the subject matter of such certificate.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA or any successor thereto.
"Person" means an individual, partnership, corporation, limited
liability company, association, trust, unincorporated organization, or a
government or agency or political subdivision thereof.
"Plan" means an "employee benefit plan" (as defined in section 3(3) of
ERISA) that is or, within the preceding five years, has been established or
maintained, or to which contributions are or, within the preceding five years,
have been made or required to be made, by the Company or any ERISA Affiliate or
with respect to which the Company or any ERISA Affiliate may have any liability.
"Preferred Stock" means, in respect of any corporation, shares of the
capital stock of such corporation that are entitled to preference or priority
over any other shares of the capital stock of such corporation in respect of
payment of dividends or distribution of assets upon liquidation.
"Priority Debt" means, at any time without duplication, the sum of (a)
all Debt of the Company and of any Subsidiaries secured by Liens other than by
Liens permitted by Sections 10.3(a) through (g) and (b) all Debt of Subsidiaries
and Preferred Stock of Subsidiaries held by entities other than the Company or a
Wholly-Owned Subsidiary; provided, that there shall be excluded from the
definition of Priority Debt (i) any Debt of a Subsidiary to the Company or a
Wholly-Owned Subsidiary, and (ii) the Guaranties of the Subsidiary Guarantors or
any Additional Subsidiary Guarantor (x) under the Guaranty Agreement and (y)
under the Bank Credit Agreement, provided, that after the Bank Closing Date the
Guaranties referred to in clause (ii) will be excluded so long as the
Intercreditor Agreement is in effect.
"property" or "properties" means, unless otherwise specifically
limited, real or personal property of any kind, tangible or intangible, ▇▇▇▇▇▇
or inchoate.
"Property Reinvestment Application" means, with respect to any Transfer
of property, the application of an amount equal to the Net Proceeds Amount with
respect to such Transfer to the acquisition by the Company or any Subsidiary of
operating assets of the Company or any Subsidiary to be used in the ordinary
course of business of such Person.
"QPAM Exemption" means Prohibited Transaction Class Exemption 84-14
issued by the United States Department of Labor.
B-10
Otter Tail Corporation Note Purchase Agreement
"Redeemable" means, with respect to the capital stock of any Person,
each share of such Person's capital stock that is:
(a) redeemable, payable or required to be purchased or
otherwise retired or extinguished, or convertible into Debt of such
Person (i) at a fixed or determinable date, whether by operation of
sinking fund or otherwise, (ii) at the option of any Person other than
such Person, or (iii) upon the occurrence of a condition not solely
within the control of such Person; or
(b) convertible into other Redeemable capital stock.
"Required Holders" means, at any time, the holders of at least 51% in
principal amount of the Notes at the time outstanding (exclusive of Notes then
owned by the Company or any of its Affiliates).
"Responsible Officer" means any Senior Financial Officer and any other
officer of the Company with responsibility for the administration of the
relevant portion of this Agreement.
"Securities Act" means the Securities Act of 1933, as amended from time
to time.
"S&P" means Standard & Poor's Corporation.
"Security" shall have the same meaning as in Regulation SX adopted by
the Securities and Exchange Commission.
"Senior Financial Officer" means the chief financial officer, principal
accounting officer, treasurer or comptroller of the Company.
"Significant Subsidiary" means at any time any Subsidiary that would at
such time constitute a "significant subsidiary" (as such term is defined in
Regulation S-X of the Securities and Exchange Commission as in effect on the
date of the Closing) of the Company.
"Subsidiary" means, as to any Person, any corporation, association or
other business entity in which such Person or one or more of its Subsidiaries or
such Person and one or more of its Subsidiaries owns sufficient equity or voting
interests to enable it or them (as a group) ordinarily, in the absence of
contingencies, to elect a majority of the directors (or Persons performing
similar functions) of such entity, and any partnership or joint venture if more
than a 50% interest in the profits or capital thereof is owned by such Person or
one or more of its Subsidiaries or such Person and one or more of its
Subsidiaries (unless such partnership can and does ordinarily take major
business actions without the prior approval of such Person or one or more of its
Subsidiaries). Unless the context otherwise clearly requires, any reference to a
"Subsidiary" is a reference to a Subsidiary of the Company.
"Subsidiary Guarantors" is defined in Section 1.
B-11
Otter Tail Corporation Note Purchase Agreement
"Subsidiary Stock" means, with respect to any Person, the stock or
other equity (or any options or warrants to purchase stock or other equity or
other Securities exchangeable for or convertible into stock or other equity) of
any Subsidiary of such Person.
"Swaps" means, with respect to any Person, payment obligations with
respect to interest rate swaps, currency swaps and similar obligations
obligating such Person to make payments, whether periodically or upon the
happening of a contingency. For the purposes of this Agreement, the amount of
the obligation under any Swap shall be the amount determined in respect thereof
as of the end of the then most recently ended fiscal quarter of such Person,
based on the assumption that such Swap had terminated at the end of such fiscal
quarter, and in making such determination, if any agreement relating to such
Swap provides for the netting of amounts payable by and to such Person
thereunder or if any such agreement provides for the simultaneous payment of
amounts by and to such Person, then in each such case, the amount of such
obligation shall be the net amount so determined.
"Total Utility Plant" means, at any time, the total Utility Plant of
the Company which would be shown on a consolidated balance sheet of the Company
and its Subsidiaries as of such time prepared in accordance with GAAP.
"Transfer" means, with respect to any Person, any transaction in which
such Person sells, conveys, transfers or leases (as lessor) or otherwise
disposes of (including a dividend or a distribution other than a regular
quarterly cash dividend paid by the Company or a distribution by the Company of
additional shares of its common stock) any of its property, including, without
limitation, Subsidiary Stock. For purposes of determining the application of the
Net Proceeds Amount in respect of any Transfer, the Company may designate any
Transfer as one or more separate Transfers each yielding a separate Net Proceeds
Amount.
"Utility Assets" means the assets of the Utility Plant.
"Utility Plant" means all property (including separate and distinct
plants, systems and properties), and all permanent improvements, extensions,
additions and betterments to or about the plants and properties of the Company
which are a part of the Company's electric utility system (including all
generating and transmission plants and properties), and are properly chargeable
under GAAP as additions to plant account including, without limiting the scope
of the foregoing, property of the character described in the preceding
provisions of this definition in process of construction or erection, so far as
actually constructed or erected.
"Utility Property Reinvestment Application" means, with respect to any
Transfer of Utility Assets, the application of an amount equal to the Net
Proceeds Amount with respect to such Transfer to the acquisition by the Company
of Utility Assets.
"Varistar" means Varistar Corporation, a Minnesota corporation and
Wholly-Owned Subsidiary of the Company.
"Wholly-Owned Subsidiary" means, at any time, any Subsidiary one
hundred percent (100%) of all of the equity interests (except directors'
qualifying shares) and voting interests of
B-12
Otter Tail Corporation Note Purchase Agreement
which are owned by any one or more of the Company and the Company's other
Wholly-Owned Subsidiaries at such time.
B-13
CHANGES IN CORPORATE STRUCTURE
None
SCHEDULE 4.9
(to Note Purchase Agreement)
DISCLOSURE MATERIALS
None
SCHEDULE 5.3
(to Note Purchase Agreement)
SUBSIDIARIES OF THE COMPANY AND OWNERSHIP OF SUBSIDIARY STOCK
JURISDICTION OF PERCENT OWNERSHIP BY THE
FORMATION CORPORATION AND ITS
SUBSIDIARIES**
1. Aerial Contractors, Inc.* North Dakota 100%
2. BTD Manufacturing, Inc.* Minnesota 100%
3. Chart L.L.C. Minnesota 100%
4. Chassis Liner Corporation* Minnesota 100%
5. Chassis Liner Credit Corp. Minnesota 100%
6. Dakota Engineering, Inc. North Dakota 100%
7. Data Video Systems, Inc. Minnesota 100%
8. DMI Industries, Inc.* North Dakota 100%
9. DMS Health Technologies, Inc.* North Dakota 100%
10 DMS Imaging, Inc.* North Dakota 100%
11. DMS Leasing, Inc. North Dakota 100%
12. ▇.▇. ▇▇▇▇▇ Corporation* North Dakota 100%
13. Fargo Baseball, LLC Minnesota 100%
14. Fargo Sports Concessions, LLC Minnesota 100%
15. KFGO, Inc. North Dakota 100%
16. Mid-States Testing Company Minnesota 100%
17. Midwest Information Systems, Inc.* Minnesota 100%
18. Midwest Telephone Co. Minnesota 100%
19. Minnesota Dakota Generating Company Minnesota 100%
20. MIS Investments, Inc. Minnesota 100%
21. ▇▇▇▇▇▇▇▇ Electric, Inc.* Minnesota 100%
SCHEDULE 5.4
(to Note Purchase Agreement)
22. MSB, Inc. North Dakota 100%
23. Northern Pipe Products, Inc.* North Dakota 100%
24. Nuclear Consultant, Inc. South Dakota 100%
25. Nuclear Imaging, Ltd.* South Dakota 100%
26. Ord Corporation Minnesota 100%
27. Osakis Telephone Company Minnesota 100%
28. Otter Tail Communications SD, Inc. South Dakota 100%
29. Otter Tail Energy Management Company Minnesota 100%
30. Otter Tail Energy Services Company* Minnesota 100%
31. Otter Tail Management Corporation Minnesota 100%
32. Otter Tail Realty Company Minnesota 100%
33. Precision Machine, Inc.* Minnesota 100%
34. Quadrant Co. Minnesota 100%
35. St. ▇▇▇▇▇▇ ▇▇▇▇▇ Fabrication Inc.* Utah 100%
36. T.O. Plastics, Inc.* Minnesota 100%
37. The Peoples Telephone Co. of Bigfork Minnesota 100%
38. Varistar Corporation (formerly known as Minnesota 100%
Mid-States Development, Inc.)*
39. Vinyltech Corporation* Arizona 100%
-------------------------
* Subsidiary Guarantor
** The stock of certain Subsidiaries is pledged to the Lenders pursuant
to the current Bank Credit Agreement with Varistar.
5.4-2
FINANCIAL STATEMENTS
Quarterly Report on Form 10-Q for the Quarter Ended September 30, 2001
Quarterly Report on Form 10-Q for the Quarter Ended June 30, 2001
Quarterly Report on Form 10-Q for the Quarter Ended March 31, 2001
Annual Report on Form 10-K for the Year Ended December 31, 2000
SCHEDULE 5.5
(to Note Purchase Agreement)
CERTAIN LITIGATION
None
SCHEDULE 5.8
(to Note Purchase Agreement)
PATENTS, ETC.
None
SCHEDULE 5.11
(to Note Purchase Agreement)
USE OF PROCEEDS
The proceeds will be used (i) to repay indebtedness of (a) $24 million of
short-term indebtedness of Otter Tail and Varistar, (b) $18.2 million of 8.75%
first mortgage bonds due September 15, 2021 of Otter Tail, and (c) $17.26
million of variable rate debt due October 31, 2007 of Varistar, (ii) to redeem
$18 million of preferred stock of Otter Tail, (iii) to fund certain capital
expenditures of Varistar of approximately $10 million, and (iv) for general
corporate purposes.
SCHEDULE 5.14
(to Note Purchase Agreement)
EXISTING INDEBTEDNESS
LOCATION DESCRIPTION AMOUNT
Otter Tail Corporation 7.25% First Mortgage Bonds $18,400,000
Otter Tail Corporation 8.75% First Mortgage Bonds $18,200,000
Otter Tail Corporation 8.25% First Mortgage Bonds $27,600,000
Otter Tail Corporation 4.65% Pollution Control Bonds $ 5,185,000
Otter Tail Corporation 4.85% Pollution Control Bonds $20,790,000
Otter Tail Corporation Senior Debentures 6.375% $50,000,000
Otter Tail Corporation Industrial Development Refunding Revenue
Bonds 5.00% $ 3,010,000
Otter Tail Corporation Pollution Control Refunding $10,400,000
Otter Tail Corporation Other $ 923,000
Varistar Corporation 7.80% due October 31, 2007 $10,333,000
Varistar Corporation Variable due October 31, 2007 $17,260,000
Varistar Corporation 8.15% due October 31, 2005 $ 5,610,000
Varistar Corporation Variable due July 3, 2007 $ 4,690,000
Varistar Corporation Other $13,521,000
SCHEDULE 5.15
(to Note Purchase Agreement)
[FORM OF NOTE]
OTTER TAIL CORPORATION
6.63% Senior Note December 1, 2011
No. [_______] [Date]
$[__________] PPN 689648 B# 9
FOR VALUE RECEIVED, the undersigned, OTTER TAIL CORPORATION (herein
called the "Company"), a corporation organized and existing under the laws of
the State of Minnesota, hereby promises to pay to [____________], or registered
assigns, the principal sum of [______________] DOLLARS on December 1, 2011, with
interest (computed on the basis of a 360-day year of twelve 30-day months) (a)
on the unpaid balance thereof at the rate of 6.63% per annum from the date
hereof, payable semiannually, on the first day of each June and December in each
year, commencing with the June or December next succeeding the date hereof,
until the principal hereof shall have become due and payable, and (b) to the
extent permitted by law on any overdue payment (including any overdue
prepayment) of principal, any overdue payment of interest and any overdue
payment of any Make-Whole Amount (as defined in the Note Purchase Agreement
referred to below), payable semiannually 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) 8.63% or (ii) 2% over the rate of interest publicly
announced by U.S. Bank National Association from time to time in Minneapolis,
Minnesota as its "base" or "prime" rate.
Payments of principal of, interest on and any Make-Whole Amount with
respect to this Note are to be made in lawful money of the United States of
America at the principal office of the Company in Fargo, North Dakota or at such
other place as the Company shall have designated by written notice to the holder
of this Note as provided in the Note Purchase Agreement referred to below.
This Note is one of a series of Senior Notes (herein called the
"Notes") issued pursuant to a Note Purchase Agreement, dated as of December 1,
2001 (as from time to time amended, the "Note Purchase Agreement"), among the
Company and the respective Purchasers named therein and is entitled to the
benefits thereof. Each holder of this Note will be deemed, by its acceptance
hereof, (i) to have agreed to the confidentiality provisions set forth in
Section 20 of the Note Purchase Agreements and (ii) to have made the
representation set forth in Section 6.2 of the Note Purchase Agreement.
This Note is a registered Note and, as provided in the Note Purchase
Agreement, upon surrender of this Note for registration of transfer, duly
endorsed, or accompanied by a written instrument of transfer duly executed, by
the registered holder hereof or such holder's attorney duly authorized in
writing, a new Note for a like principal amount will be issued to, and
registered in the name of, the transferee. Prior to due presentment for
registration of transfer, the Company may treat the person in whose name this
Note is registered as the owner hereof for the
EXHIBIT 1
(to Note Purchase Agreement)
purpose of receiving payment and for all other purposes, and the Company will
not be affected by any notice to the contrary.
This Note is subject to optional prepayment, in whole or from time to
time in part, at the times and on the terms specified in the Note Purchase
Agreement, but not otherwise.
If an Event of Default, as defined in the Note Purchase Agreement,
occurs and is continuing, the principal of this Note may be declared or
otherwise become due and payable in the manner, at the price (including any
applicable Make-Whole Amount) and with the effect provided in the Note Purchase
Agreement.
All amounts of principal, interest and Make-Whole Amount (as such term
is defined in the Note Purchase Agreement) payable with respect to the Notes are
unconditionally guaranteed by the Subsidiary Guarantors (as such term is defined
in the Note Purchase Agreement), under and pursuant to that certain Guaranty
Agreement dated as of December 1, 2001 from such Subsidiary Guarantors, all in
accordance with the provisions of the Note Purchase Agreement.
This Note shall be construed and enforced in accordance with, and the
rights of the parties shall be governed by, the law of the State of New York
excluding choice-of-law principals of the law of such State that would require
the application of the laws of a jurisdiction other than such State.
OTTER TAIL CORPORATION
By
-----------------------------
Name:
Title:
5-4-2
FORM OF GUARANTY AGREEMENT
EXHIBIT 2
(to Note Purchase Agreement)
================================================================================
GUARANTY AGREEMENT
Dated as of December 1, 2001
Re: $90,000,000 6.63% Senior Notes
due December 1, 2011
of
Otter Tail Corporation
================================================================================
TABLE OF CONTENTS
(Not a part of the Agreement)
SECTION HEADING PAGE
Parties...........................................................................................................1
Recitals..........................................................................................................1
SECTION 1. DEFINITIONS............................................................................2
SECTION 2. GUARANTY OF NOTES AND NOTE AGREEMENT...................................................2
SECTION 3. GUARANTY OF PAYMENT AND PERFORMANCE....................................................2
SECTION 4. GENERAL PROVISIONS RELATING TO THE GUARANTY............................................3
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE GUARANTORS.......................................7
SECTION 6. AMENDMENTS, WAIVERS AND CONSENTS.......................................................9
SECTION 7. SUBMISSION TO JURISDICTION............................................................10
SECTION 8. NOTICES...............................................................................10
SECTION 9. MISCELLANEOUS.........................................................................11
Signature........................................................................................................12
ATTACHMENTS TO GUARANTY AGREEMENT:
EXHIBIT A - Guaranty Supplement
GUARANTY AGREEMENT
Re: $90,000,000 6.63% Senior Notes
due December 1, 2011
of Otter Tail Corporation
-------------------------------------------------
This GUARANTY AGREEMENT dated as of December 1, 2001 (the or this
"Guaranty") is entered into on a joint and several basis by each of the
undersigned (which parties are hereinafter referred to individually as a
"Guarantor" and collectively as the "Guarantors")
RECITALS
A. Each Guarantor, is presently a directly or indirectly wholly-owned
subsidiary of Otter Tail Corporation, a Minnesota corporation (the "Company").
B. In order to raise funds to refinance existing Debt (as defined in
the Note Agreement defined below) and for general corporate purposes, the
Company has entered into the Note Purchase Agreement dated as of December 1,
2001 (the "Note Agreement") among the Company and each of the purchasers named
on Schedule A attached to said Note Agreement (the "Initial Note Purchasers,"
together with their successors and assigns, the "Holders"), providing for, among
other things, the issue and sale by the Company to the Initial Note Purchasers
of the Company's 6.63% Senior Notes due December 1, 2011 in the aggregate
principal amount of $90,000,000 (the "Notes").
C. The Initial Note Purchasers have required as a condition of their
purchase of the Notes that the Company cause each of the undersigned to enter
into this Guaranty and to cause each Subsidiary (defined in the Note Agreement)
which after the Closing (as defined in the Note Agreement) guarantees the
Company's obligations under the Bank Credit Agreement ("Additional Subsidiary
Guarantor") to enter into a Guaranty Supplement in substantially the form set
forth in Exhibit A hereto (a "Guaranty Supplement"), in each case as security
for the Notes, and the Company has agreed to cause the Guarantor to execute this
Guaranty and to cause each Additional Subsidiary Guarantor to execute a Guaranty
Supplement, in each case in order to induce the Initial Note Purchasers to
purchase the Notes and thereby benefit the Company and its Subsidiaries by
providing funds to enable the Company to refinance existing Debt (as further
described in the Note Agreement) and to enable the Company and its Subsidiaries
to have funds available for general corporate purposes.
NOW, THEREFORE, as required by Section 4.10 of the Note Agreement and
in consideration of the premises and other good and valuable consideration, the
receipt and sufficiency whereof are hereby acknowledged, each Guarantor does
hereby covenant and agree, jointly and severally as follows:
SECTION 1. DEFINITIONS.
Capitalized terms used herein shall have the meanings set forth in the
Note Agreement unless herein defined or the context shall otherwise require.
SECTION 2. GUARANTY OF NOTES AND NOTE AGREEMENT.
(a) Each Guarantor jointly and severally does hereby irrevocably,
absolutely and unconditionally guarantee unto the Holders: (1) the full and
prompt payment of the principal of, premium, if any, and interest on the Notes
from time to time outstanding, as and when such payments shall become due and
payable, whether by lapse of time, upon redemption or prepayment, by extension
or by acceleration or declaration or otherwise (including (to the extent legally
enforceable) interest due on overdue payments of principal, premium, if any, or
interest at the rate set forth in the Notes and interest accruing at the then
applicable rate provided in the Notes after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to the Company, whether or not a claim for post-filing or
post-petition interest is allowed in such proceeding) in Federal or other
immediately available funds of the United States of America which at the time of
payment or demand therefor shall be legal tender for the payment of public and
private debts, (2) the full and prompt performance and observance by the Company
of each and all of the obligations, covenants and agreements required to be
performed or owed by the Company under the terms of the Notes and the Note
Agreement and (3) the full and prompt payment, upon demand by any Holder, of all
costs and expenses, legal or otherwise (including reasonable attorneys' fees),
if any, as shall have been expended or incurred in the protection or enforcement
of any rights, privileges or liabilities in favor of the Holders under or in
respect of the Notes, the Note Agreement or under this Guaranty or in any action
in connection therewith or herewith and in each and every case irrespective of
the validity, regularity, or enforcement of any of the Notes or Note Agreement
or any of the terms thereof or any other like circumstance or circumstances.
(b) The liability of each Guarantor under this Guaranty shall not
exceed an amount equal to a maximum amount as will, after giving effect to such
maximum amount and all other liabilities of such Guarantor, contingent or
otherwise, result in the obligations of such Guarantor hereunder not
constituting a fraudulent transfer, obligation or conveyance.
SECTION 3. GUARANTY OF PAYMENT AND PERFORMANCE.
This is a guarantee of payment and performance and each Guarantor
hereby waives, to the fullest extent permitted by law, any right to require that
any action on or in respect of any Note or the Note Agreement be brought against
the Company or any other Person or that resort be had to any direct or indirect
security for the Notes or for this Guaranty or any other remedy. Any Holder may,
at its option, proceed hereunder against any Guarantor in the first instance to
collect monies when due, the payment of which is guaranteed hereby, without
first proceeding against the Company or any other Person and without first
resorting to any direct or indirect security for the Notes or for this Guaranty
or any other remedy. The liability of each Guarantor hereunder shall in no way
be affected or impaired by any acceptance by any Holder of any
EXHIBIT 3
To Note Purchase Agreement
direct or indirect security for, or other guaranties of, any Debt, liability or
obligation of the Company or any other Person to any Holder or by any failure,
delay, neglect or omission by any Holder to realize upon or protect any such
guarantees, Debt, liability or obligation or any notes or other instruments
evidencing the same or any direct or indirect security therefor or by any
approval, consent, waiver, or other action taken, or omitted to be taken by any
such Holder.
The covenants and agreements on the part of the Guarantors herein
contained shall take effect as joint and several covenants and agreements, and
references to the Guarantors shall take effect as references to each of them and
none of them shall be released from liability hereunder by reason of the
guarantee ceasing to be binding as a continuing security on any other of them.
SECTION 4. GENERAL PROVISIONS RELATING TO THE GUARANTY.
(a) Each Guarantor hereby consents and agrees that any Holder or
Holders from time to time with or without the assent of any other Guarantor, may
without in any manner affecting the liability of any other Guarantor under this
Guaranty, and upon such terms and conditions as any such Holder or Holders may
deem advisable:
(1) extend in whole or in part (by renewal or otherwise),
modify, change, compromise, release or extend the duration of the time
for the performance or payment of any Debt, liability or obligation of
the Company or of any other Person secondarily or otherwise liable for
any Debt, liability or obligations of the Company on the Notes, or
waive any Default with respect thereto, or waive, modify, amend or
change any provision of any other agreement or this Guaranty; or
(2) sell, release, surrender, modify, impair, exchange or
substitute any and all property, of any nature and from whomsoever
received, held by, or for the benefit of, any such Holder as direct or
indirect security for the payment or performance of any Debt, liability
or obligation of the Company or of any other Person secondarily or
otherwise liable for any Debt, liability or obligation of the Company
on the Notes; or
(3) settle, adjust or compromise any claim of the Company
against any other Person secondarily or otherwise liable for any Debt,
liability or obligation of the Company on the Notes.
Each Guarantor hereby ratifies and confirms any such extension,
renewal, change, sale, release, waiver, surrender, exchange, modification,
amendment, impairment, substitution, settlement, adjustment or compromise and
that the same shall be binding upon it, and hereby waives, to the fullest extent
permitted by law, any and all defenses, counterclaims or offsets which it might
or could have by reason thereof, it being understood that such Guarantor shall
at all times be bound by this Guaranty and remain liable hereunder.
(b) Each Guarantor hereby waives, to the fullest extent permitted by
law:
(1) notice of acceptance of this Guaranty by the Holders or
of the creation, renewal or accrual of any liability of the Company,
present or future, or of the reliance of
EXHIBIT 3
To Note Purchase Agreement
such Holders upon this Guaranty (it being understood that every Debt,
liability and obligation described in Section 2 hereof shall
conclusively be presumed to have been created, contracted or incurred
in reliance upon the execution of this Guaranty);
(2) demand of payment by any Holder from the Company or any
other Person indebted in any manner on or for any of the Debt,
liabilities or obligations hereby guaranteed; and
(3) presentment for the payment by any Holder or any other
Person of the Notes or any other instrument, protest thereof and notice
of its dishonor to any party thereto and to such Guarantor.
The obligations of each Guarantor under this Guaranty and the rights of
any Holder to enforce such obligations by any proceedings, whether by action at
law, suit in equity or otherwise, shall not be subject to any reduction,
limitation, impairment or termination, whether by reason of any claim of any
character whatsoever or otherwise and shall not be subject to any defense,
set-off, counterclaim (other than any compulsory counterclaim), recoupment or
termination whatsoever.
(c) The obligations of each Guarantor hereunder shall be binding upon
such Guarantor and its successors and assigns, and shall remain in full force
and effect irrespective of:
(1) the genuineness, validity, regularity or enforceability
of the Notes, the Note Agreement or any other agreement or any of the
terms of any thereof, the continuance of any obligation on the part of
the Company, or any other Guarantor or any other Person on or in
respect of the Notes or under the Note Agreement or any other agreement
or the power or authority or the lack of power or authority of the
Company to issue the Notes or the Company to execute and deliver the
Note Agreement or any other agreement or of any other Guarantor to
execute and deliver this Guaranty or to perform any of its obligations
hereunder or the existence or continuance of the Company, any other
Guarantor or any other Person as a legal entity; or
(2) any default, failure or delay, willful or otherwise, in
the performance by the Company, any other Guarantor or any other Person
of any obligations of any kind or character whatsoever under the Notes,
the Note Agreement or any other agreement; or
(3) any creditors' rights, bankruptcy, receivership or other
insolvency proceeding of the Company, any other Guarantor or any other
Person or in respect of the property of the Company, any other
Guarantor or any other Person or any merger, consolidation,
reorganization, dissolution, liquidation, the sale of all or
substantially all of the assets of or winding up of the Company, any
other Guarantor or any other Person; or
(4) impossibility or illegality of performance on the part of
the Company, any other Guarantor or any other Person of its obligations
under the Notes, the Note Agreement or any other agreements; or
EXHIBIT 3
To Note Purchase Agreement
(5) in respect of the Company, any other Guarantor or any
other Person, any change of circumstances, whether or not foreseen or
foreseeable, whether or not imputable to the Company, any other
Guarantor or any other Person, or other impossibility of performance
through fire, explosion, accident, labor disturbance, floods, droughts,
embargoes, wars (whether or not declared), civil commotion, acts of God
or the public enemy, delays or failure of suppliers or carriers,
inability to obtain materials, action of any federal or state
regulatory body or agency, change of law or any other causes affecting
performance, or any other force majeure, whether or not beyond the
control of the Company, any other Guarantor or any other Person and
whether or not of the kind hereinbefore specified; or
(6) any attachment, claim, demand, charge, Lien, order,
process, encumbrance or any other happening or event or reason, similar
or dissimilar to the foregoing, or any withholding or diminution at the
source, by reason of any taxes, assessments, expenses, Debt,
obligations or liabilities of any character, foreseen or unforeseen,
and whether or not valid, incurred by or against the Company, any
Guarantor or any other Person or any claims, demands, charges or Liens
of any nature, foreseen or unforeseen, incurred by any Person, or
against any sums payable in respect of the Notes or under the Note
Agreement or this Guaranty, so that such sums would be rendered
inadequate or would be unavailable to make the payments herein
provided; or
(7) any order, judgment, decree, ruling or regulation
(whether or not valid) of any court of any nation or of any political
subdivision thereof or any body, agency, department, official or
administrative or regulatory agency of any thereof or any other action,
happening, event or reason whatsoever which shall delay, interfere
with, hinder or prevent, or in any way adversely affect, the
performance by the Company, any Guarantor or any other Person of its
respective obligations under or in respect of the Notes, the Note
Agreement, this Guaranty or any other agreement; or
(8) the failure of any Guarantor to receive any benefit from
or as a result of its execution, delivery and performance of this
Guaranty; or
(9) any failure or lack of diligence in collection or
protection, failure in presentment or demand for payment, protest,
notice of protest, notice of default and of nonpayment, any failure to
give notice to any Guarantor of failure of the Company, any other
Guarantor or any other Person to keep and perform any obligation,
covenant or agreement under the terms of the Notes, the Note Agreement,
this Guaranty or any other agreement or failure to resort for payment
to the Company, any other Guarantor or to any other Person or to any
other guaranty or to any property, security, Liens or other rights or
remedies; or
(10) the acceptance of any additional security or other
guaranty, the advance of additional money to the Company or any other
Person, the renewal or extension of the Notes or amendments,
modifications, consents or waivers with respect to the Notes, the Note
Agreement or any other agreement, or the sale, release, substitution or
exchange of any security for the Notes; or
EXHIBIT 3
To Note Purchase Agreement
(11) any merger or consolidation of the Company, any Guarantor
or any other Person into or with any other Person or any sale, lease,
transfer or other disposition of any of the assets of the Company, any
Guarantor or any other Person to any other Person, or any change in the
ownership of any shares of the Company, any Guarantor or any other
Person; or
(12) any defense whatsoever that: (i) the Company or any other
Person might have to the payment of the Notes (principal, premium, if
any, or interest), other than payment thereof in Federal or other
immediately available funds, or (ii) the Company or any other Person
might have to the performance or observance of any of the provisions of
the Notes, the Note Agreement or any other agreement, whether through
the satisfaction or purported satisfaction by the Company, any other
Guarantor or any other Person of its debts due to any cause such as
bankruptcy, insolvency, receivership, merger, consolidation,
reorganization, dissolution, liquidation, winding-up or otherwise; or
(13) any act or failure to act with regard to the Notes, the
Note Agreement, this Guaranty or any other agreement or anything which
might vary the risk of any Guarantor or any other Person; or
(14) any other circumstance which might otherwise constitute a
defense available to, or a discharge of, any Guarantor or any other
Person in respect of the obligations of any Guarantor or other Person
under this Guaranty or any other agreement;
provided that the specific enumeration of the above-mentioned acts, failures or
omissions shall not be deemed to exclude any other acts, failures or omissions,
though not specifically mentioned above, it being the purpose and intent of this
Guaranty that the obligations of each Guarantor shall be absolute and
unconditional and shall not be discharged, impaired or varied except by the
payment of the principal of, premium, if any, and interest on the Notes in
accordance with their respective terms whenever the same shall become due and
payable as in the Notes provided and all other sums due and payable under the
Note Agreement, at the place specified in and all in the manner and with the
effect provided in the Notes and the Note Agreement, as each may be amended or
modified from time to time. Without limiting the foregoing, it is understood
that repeated and successive demands may be made and recoveries may be had
hereunder as and when, from time to time, the Company shall default under or in
respect of the terms of the Notes or the Note Agreement and that notwithstanding
recovery hereunder for or in respect of any given default or defaults by the
Company under the Notes or the Note Agreement, this Guaranty shall remain in
full force and effect and shall apply to each and every subsequent default.
(d) Subject to the limitations under the Note Agreement on the rights
of a Holder to transfer or assign the Notes, all rights of any Holder may be
transferred or assigned at any time and shall be considered to be transferred or
assigned at any time or from time to time upon the transfer of such Note whether
with or without the consent of or notice to the Guarantors under this Guaranty
or to the Company.
(e) To the extent of any payments made under this Guaranty, each
Guarantor shall be subrogated to the rights of the Holder upon whose Notes such
payment was made, but such
EXHIBIT 3
To Note Purchase Agreement
Guarantor covenants and agrees that such right of subrogation shall be
subordinate in right of payment to the prior indefeasible final payment in cash
in full of all amounts due and owing by the Company with respect to the Notes
and the Note Agreement and by the Guarantors under this Guaranty, and the
Guarantors shall not take any action to enforce such right of subrogation, and
the Guarantors shall not accept any payment in respect of such right of
subrogation, until all amounts due and owing by the Company under or in respect
of the Notes and the Note Agreement and all amounts due and owing by the
Guarantors hereunder have indefeasibly been finally paid in cash in full. If any
amount shall be paid to any Guarantor in violation of the preceding sentence at
any time prior to the later of the indefeasible payment in cash in full of the
Notes and all other amounts payable under the Notes, the Note Agreement and this
Guaranty, such amount shall be held in trust for the benefit of the Holders and
shall forthwith be paid to the Holders to be credited and applied to the amounts
due or to become due with respect to the Notes and all other amounts payable
under the Note Agreement and this Guaranty, whether matured or unmatured. Each
Guarantor acknowledges that it has received direct and indirect benefits from
the financing arrangements contemplated by the Note Agreement and that the
waiver set forth in this paragraph (e) is knowingly made as a result of the
receipt of such benefits.
(f) Each Guarantor agrees that to the extent the Company, any other
Guarantor or any other Person makes any payment on any Note, which payment or
any part thereof is subsequently invalidated, voided, declared to be fraudulent
or preferential, set aside, recovered, rescinded or is required to be retained
by or repaid to a trustee, receiver, or any other Person under any bankruptcy
code, common law, or equitable cause, then and to the extent of such payment,
the obligation or the part thereof intended to be satisfied shall be revived and
continued in full force and effect with respect to the Guarantors' obligations
hereunder, as if said payment had not been made. The liability of the Guarantors
hereunder shall not be reduced or discharged, in whole or in part, by any
payment to any Holder from any source that is thereafter paid, returned or
refunded in whole or in part by reason of the assertion of a claim of any kind
relating thereto, including, but not limited to, any claim for breach of
contract, breach of warranty, preference, illegality, invalidity, or fraud
asserted by any account debtor or by any other Person.
(g) No Holder shall be under any obligation: (1) to ▇▇▇▇▇▇▇▇ any assets
in favor of the Guarantors or in payment of any or all of the liabilities of the
Company under or in respect of the Notes or the obligations of the Guarantors
hereunder or (2) to pursue any other remedy that the Guarantors may or may not
be able to pursue themselves and that may lighten the Guarantors' burden, any
right to which each Guarantor hereby expressly waives.
(h) The obligations of each Guarantor under this Guaranty rank pari
passu in right of payment with all other Debt of such Guarantor which is not
secured or which is not expressly subordinated in right of payment to any other
Debt of such Guarantor.
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE GUARANTORS.
Each Guarantor represents and warrants to each Holder that:
(a) Such Guarantor is a corporation or other legal entity duly
organized, validly existing and in good standing under the laws of its
jurisdiction of organization, and is duly
EXHIBIT 3
To Note Purchase Agreement
qualified as a foreign corporation or other legal entity and is in good standing
in each jurisdiction in which such qualification is required by law, other than
those jurisdictions as to which the failure to be so qualified or in good
standing could not, individually or in the aggregate, reasonably be expected to
have a material adverse effect on (1) the business, operations, affairs,
financial condition, assets, properties or prospects of such Guarantor and its
subsidiaries, taken as a whole, or (2) the ability of such Guarantor to perform
its obligations under this Guaranty, or (3) the validity or enforceability of
this Guaranty (herein in this Section 5, a "Material Adverse Effect"). Such
Guarantor has the power and authority to own or hold under lease the properties
it purports to own or hold under lease, to transact the business it transacts
and proposes to transact, to execute and deliver this Guaranty and to perform
the provisions hereof.
(b) This Guaranty has been duly authorized by all necessary action on
the part of such Guarantor, and this Guaranty constitutes a legal, valid and
binding obligation of such Guarantor enforceable against such Guarantor in
accordance with its terms, except as such enforceability may be limited by (1)
applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer, obligation or conveyance or other similar laws affecting the
enforcement of creditors' rights generally and (2) general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
(c) The execution, delivery and performance by such Guarantor of this
Guaranty will not (1) contravene, result in any breach of, or constitute a
default under, or result in the creation of any Lien in respect of any property
of such Guarantor or any of its subsidiaries under its corporate charter or
by-laws, or except for contraventions, breaches or defaults which could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect, under any indenture, mortgage, deed of trust, loan, purchase or
credit agreement, lease, or any other agreement or instrument to which such
Guarantor or any of its subsidiaries is bound or by which such Guarantor or any
of its subsidiaries or any of their respective properties may be bound or
affected, (2) conflict with or result in a breach of any of the terms,
conditions or provisions of any order, judgment, decree, or ruling of any court,
arbitrator or Governmental Authority applicable to such Guarantor or any of its
subsidiaries or (3) violate any provision of any statute or other rule or
regulation of any Governmental Authority applicable to such Guarantor or any of
its subsidiaries.
(d) No consent, approval or authorization of, or registration, filing
or declaration with, any Governmental Authority is required in connection with
the execution, delivery or performance by such Guarantor of this Guaranty.
(e) (1) Except as disclosed in Schedule 5.8 to the Note Agreement,
there are no actions, suits or proceedings pending or, to the knowledge of such
Guarantor, threatened against or affecting such Guarantor or any of its
subsidiaries or any property of such Guarantor or any of its subsidiaries in any
court or before any arbitrator of any kind or before or by any Governmental
Authority that, individually or in the aggregate, could reasonably be expected
to have a Material Adverse Effect.
(2) Neither such Guarantor nor any of its subsidiaries is in
default under any term of any agreement or instrument to which it is a party or
by which it is bound, or any order,
EXHIBIT 3
To Note Purchase Agreement
judgment, decree or ruling of any court, arbitrator or Governmental Authority or
is in violation of any applicable law, ordinance, rule or regulation (including
without limitation Environmental Laws) of any Governmental Authority, which
default or violation, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.
(f) Such Guarantor is solvent, has capital not unreasonably small in
relation to its business or any contemplated or undertaken transaction and has
assets having a value both at fair valuation and at present fair salable value
greater than the amount required to pay its debts as they become due and greater
than the amount that will be required to pay its probable liability on its
existing debts as they become absolute and matured. Such Guarantor does not
intend to incur, or believe that it will incur, debts beyond its ability to pay
such debts as they become due. Such Guarantor will not be rendered insolvent by
the execution and delivery of, and performance of its obligations under, this
Guaranty. Such Guarantor does not intend to hinder, delay or defraud its
creditors by or through the execution and delivery of, or performance of its
obligations under, this Guaranty.
SECTION 6. AMENDMENTS, WAIVERS AND CONSENTS.
(a) This Guaranty may be amended, and the observance of any term hereof
may be waived (either retroactively or prospectively), with (and only with) the
written consent of each Guarantor and the Required Holders, except that (1) no
amendment or waiver of any of the provisions of Sections 2, 3 or 4, or any
defined term (as it is used therein), will be effective as to any Holder unless
consented to by such Holder in writing, and (2) no such amendment or waiver may,
without the written consent of each Holder, (i) change the percentage of the
principal amount of the Notes the Holders of which are required to consent to
any such amendment or waiver, or (ii) amend this Section 6.
(b) The Guarantors will provide each Holder (irrespective of the amount
of Notes then owned by it) with sufficient information, and shall be afforded
the opportunity of considering the same for a period of not less than 30 days
and shall be supplied by the Guarantors with a brief statement regarding the
reasons for any such proposed waiver or amendment, a copy of the proposed waiver
or amendment and such other information regarding such amendment as any Holder
shall reasonably request to enable it to make an informed decision with respect
thereto. The Guarantors will deliver executed or true and correct copies of each
amendment, waiver or consent effected pursuant to the provisions of this Section
6 to each Holder promptly following the date on which it is executed and
delivered by, or receives the consent or approval of, the requisite Holders.
(c) Each Guarantor agrees it will not directly or indirectly pay or
cause to be paid any remuneration, whether by way of fee or otherwise, or grant
any security, to any Holder as consideration for or as an inducement to the
entering into by any Holder of any waiver or amendment of any of the terms and
provisions hereof unless such remuneration is concurrently paid, or security is
concurrently granted, on the same terms, ratably to each Holder even if such
Holder did not consent to such waiver or amendment.
EXHIBIT 3
To Note Purchase Agreement
(d) Any amendment or waiver consented to as provided in this Section 6
applies equally to all Holders and is binding upon them and upon each future
holder and upon the Guarantors. No such amendment or waiver will extend to or
affect any obligation, covenant or agreement not expressly amended or waived or
impair any right consequent thereon. No course of dealing between the Guarantors
and any Holder nor any delay in exercising any rights hereunder shall operate as
a waiver of any rights of any Holder. As used herein, the term "this Guaranty"
and references thereto shall mean this Guaranty as it may from time to time be
amended or supplemented.
SECTION 7. SUBMISSION TO JURISDICTION.
Any legal action or proceeding with respect to this Guaranty or any
document relating thereto shall be brought in the courts of the State of New
York or of the United States of America for the Southern District of New York
and in no other courts, and, by execution and delivery of this Guaranty, each
Guarantor hereby accepts for itself and in respect of its property generally and
unconditionally, the jurisdiction of the aforesaid courts. Each Guarantor hereby
irrevocably and unconditionally waives any objection, including, without
limitation, any objection to the laying of venue or based on the grounds of
forum non conveniens which it may now or hereafter have to the bringing of any
action or proceeding in such respective jurisdiction and waives personal service
of any and all process upon it, and consents that all such service of process be
made by delivery to it at the address set forth in Section 8 and that service so
made shall be deemed to be completed upon actual receipt.
SECTION 8. NOTICES.
All notices and communications provided for hereunder shall be in
writing and sent (a) by telefacsimile if the sender on the same day sends a
confirming copy of such notice by a recognized overnight delivery service
(charges prepaid), or (b) by registered or certified mail with return receipt
requested (postage prepaid), or (c) by a recognized overnight delivery service
(with charges prepaid). Any such notice must be sent:
(1) if to an Initial Note Purchaser or such Initial Note
Purchaser's nominee, to such Initial Note Purchaser or such Initial
Note Purchaser's nominee at the address specified for such
communications on Schedule A to the Note Agreement, or at such other
address as such Initial Note Purchaser or such Initial Note Purchaser's
nominee shall have specified to any Guarantor or the Company in
writing,
(2) if to any other Holder, to such Holder at such address as
such Holder shall have specified to any Guarantor or the Company in
writing, or
(3) if to any Guarantor, to such Guarantor c/o the Company at
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, or at such other
address as such Guarantor shall have specified to the Holders in
writing.
Notices under this Section 8 will be deemed given only when actually received.
EXHIBIT 3
To Note Purchase Agreement
SECTION 9. MISCELLANEOUS.
(a) No remedy herein conferred upon or reserved to any Holder is
intended to be exclusive of any other available remedy or remedies, but each and
every such remedy shall be cumulative and shall be in addition to every other
remedy given under this Guaranty now or hereafter existing at law or in equity.
No delay or omission to exercise any right or power accruing upon any default,
omission or failure of performance hereunder shall impair any such right or
power or shall be construed to be a waiver thereof but any such right or power
may be exercised from time to time and as often as may be deemed expedient. In
order to entitle any Holder to exercise any remedy reserved to it under the
Guaranty, it shall not be necessary for such Holder to physically produce its
Note in any proceedings instituted by it or to give any notice, other than such
notice as may be herein expressly required.
(b) The Guarantors will pay all sums becoming due under this Guaranty
by the method and at the address specified for such purpose on Schedule A to the
Note Agreement, or by such other reasonable method or at such other address as
any Holder shall have from time to time specified to the Guarantors in writing
for such purpose, without the presentation or surrender of this Guaranty or any
Note.
(c) Any provision of this Guaranty that is prohibited or unenforceable
in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall (to the full extent permitted by law) not invalidate or
render unenforceable such provision in any other jurisdiction.
(d) If the whole or any part of this Guaranty shall be now or hereafter
become unenforceable against any one or more of the Guarantors for any reason
whatsoever or if it is not executed by any one or more of the Guarantors, this
Guaranty shall nevertheless be and remain fully binding upon and enforceable
against each other Guarantor as if it had been made and delivered only by such
other Guarantors.
(e) This Guaranty shall be binding upon each Guarantor and its
successors and assigns and shall inure to the benefit of each Holder and its
successors and assigns (including, without limitation, any subsequent holder of
a Note) whether so expressed or not, so long as its Notes remain outstanding and
unpaid.
(f) This Guaranty may be executed in any number of counterparts, each
of which shall be an original but all of which together shall constitute one
instrument. Each counterpart may consist of a number of copies hereof, each
signed by less than all, but together signed by all, of the parties hereto.
(g) This Guaranty 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, but excluding choice-of-law principles of the law of such State that would
require the application of the laws of a jurisdiction other than such State.
EXHIBIT 3
To Note Purchase Agreement
IN WITNESS WHEREOF, the undersigned has caused this Guaranty to be duly
executed by an authorized representative as of this first day of December, 2001.
AERIAL CONTRACTORS, INC.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
Title: DIRECTOR
------------------------------------
BTD MANUFACTURING, INC.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Title: DIRECTOR
-----------------------------------
CHASSIS LINER CORPORATION
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Title: DIRECTOR
-----------------------------------
DMI INDUSTRIES, INC.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Title: DIRECTOR
-----------------------------------
DMS HEALTH TECHNOLOGIES
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Title: DIRECTOR
-----------------------------------
DMS IMAGING, INC.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Title: DIRECTOR
-----------------------------------
EXHIBIT 3
To Note Purchase Agreement
▇.▇. ▇▇▇▇▇ CORPORATION
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Title: DIRECTOR
-----------------------------------
MIDWEST INFORMATION SYSTEMS, INC.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Title: DIRECTOR
-----------------------------------
▇▇▇▇▇▇▇▇ ELECTRIC, INC.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Title: DIRECTOR
-----------------------------------
NORTHERN PIPE PRODUCTS, INC.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Title: DIRECTOR
-----------------------------------
NUCLEAR IMAGING, LTD
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Title: DIRECTOR
-----------------------------------
OTTER TAIL ENERGY SERVICES COMPANY
By /s/ ▇▇▇▇▇ ▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇
-----------------------------------
Title: TREASURER
-----------------------------------
EXHIBIT 3
To Note Purchase Agreement
PRECISION MACHINE, INC.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Title: DIRECTOR
-----------------------------------
ST. ▇▇▇▇▇▇ ▇▇▇▇▇ FABRICATION, INC.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Title: DIRECTOR
-----------------------------------
T.O. PLASTICS, INC.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Title: DIRECTOR
-----------------------------------
VARISTAR CORPORATION
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Title: DIRECTOR
-----------------------------------
VINYLTECH CORPORATION
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Title: DIRECTOR
-----------------------------------
EXHIBIT 3
To Note Purchase Agreement
GUARANTY SUPPLEMENT
To the Holders of the Notes
of Otter Tail Corporation
(the "Company")
Ladies and Gentlemen:
WHEREAS, in order to refinance existing indebtedness and for general
corporate purposes, the Company issued its 6.63% Senior Notes due December 1,
2011 in the aggregate principal amount of $90,000,000 (the "Notes") pursuant to
the Note Purchase Agreement dated as of December 1, 2001 (the "Note Agreement")
among the Company and each of the purchasers named on Schedule A attached to
said Note Agreement (the "Initial Note Purchasers").
WHEREAS, as a condition precedent to their purchase of the Notes, the
Initial Note Purchasers required that certain Subsidiaries of the Company enter
into a Guaranty Agreement as security for the Notes (the "Guaranty").
Pursuant to Section 9.8 of the Note Agreement, the Company has agreed
to cause the undersigned, ____________, a corporation organized under the laws
of ______________ (the "Additional Subsidiary Guarantor"), to execute the
Guaranty. In accordance with the requirements of the Guaranty, the Additional
Subsidiary Guarantor desires to amend the definition of Guarantor (as the same
may have been heretofore amended) set forth in the Guaranty attached hereto so
that at all times from and after the date hereof, the Additional Subsidiary
Guarantor shall be jointly and severally liable as set forth in the Guaranty for
the obligations of the Company under the Note Agreement and Notes to the extent
and in the manner set forth in the Guaranty.
The undersigned is the duly elected ____________ of the Additional
Subsidiary Guarantor, a subsidiary of the Company, and is duly authorized to
execute and deliver this Guaranty Supplement to each of you. The execution by
the undersigned of this Guaranty Supplement shall evidence its consent to and
acknowledgment and approval of the terms set forth herein and in the Guaranty
and by such execution the Additional Subsidiary Guarantor shall be deemed to
have made in favor of the Holders the representations and warranties set forth
in Section 5 of the Guaranty.
Upon execution of this Guaranty Supplement, the Guaranty shall be
deemed to be amended as set forth above. Except as amended herein, the terms and
provisions of the Guaranty are hereby ratified, confirmed and approved in all
respects.
EXHIBIT A
(to Guaranty Agreement)
Any and all notices, requests, certificates and other instruments
(including the Notes) may refer to the Guaranty without making specific
reference to this Guaranty Supplement, but nevertheless all such references
shall be deemed to include this Guaranty Supplement unless the context shall
otherwise require.
Dated: _________________, ____.
[NAME OF ADDITIONAL SUBSIDIARY
GUARANTOR]
By
Name: _______________________________
Title: ______________________________
EXHIBIT 3
To Note Purchase Agreement
FORM OF INTERCREDITOR AGREEMENT
EXHIBIT 3
To Note Purchase Agreement
================================================================================
INTERCREDITOR AGREEMENT
Dated as of December 1, 2001
Re: $90,000,000 6.63% Senior Notes due December 1, 2011
of
OTTER TAIL CORPORATION
================================================================================
TABLE OF CONTENTS
SECTION HEADING PAGE
Parties.....................................................................1
Recitals....................................................................1
SECTION 1. DEFINITIONS......................................2
SECTION 2. SHARING OF RECOVERIES............................4
SECTION 3. AGREEMENTS AMONG THE CREDITORS...................4
Section 3.1. Independent Actions by Creditors.................4
Section 3.2. Relation of Creditors............................4
Section 3.3. Acknowledgment of Guaranties.....................5
Section 3.4. Additional Guarantors............................5
Section 3.5. Additional Lenders...............................5
SECTION 4. MISCELLANEOUS....................................5
Section 4.1. Entire Agreement.................................5
Section 4.2. Notices..........................................5
Section 4.3. Successors and Assigns...........................5
Section 4.4. Consents, Amendment, Waivers.....................5
Section 4.5. Governing Law....................................5
Section 4.6. Counterparts.....................................6
Section 4.7. Sale of Interest.................................6
Section 4.8. Severability.....................................6
Section 4.9. Expenses.........................................6
Section 4.10. Term of Agreement................................6
Signatures..................................................................7
-i-
INTERCREDITOR AGREEMENT
INTERCREDITOR AGREEMENT dated as of December 1, 2001 among the
Creditors (as defined below) and Otter Tail Corporation, a corporation
incorporated under the laws of Minnesota (the "Company").
RECITALS:
A. Under and pursuant to the Note Purchase Agreement, dated as of
December 1, 2001 (the "Note Purchase Agreement"), among the Company and the
purchasers named on Schedule A attached to the Note Purchase Agreement
(individually a "Noteholder" and collectively, the "Noteholders"), the Company
proposes to issue and sell to the Noteholders $90,000,000 aggregate principal
amount of its 6.63% Senior Notes, due December 1, 2011 (the "Notes").
B. The Noteholders have required as a condition of their purchase of
the Notes that each of the Subsidiaries listed as signatories to the Guaranty
Agreement referred to in the Note Purchase Agreement (each being a "Subsidiary
Guarantor" and collectively the "Subsidiary Guarantors"), enter into a guaranty
as security for the Notes and accordingly the Subsidiary Guarantor has agreed to
provide a guaranty. Each such Subsidiary Guarantor proposes to execute and
deliver the Guaranty Agreement (each a "Noteholders' Guaranty" and collectively
the "Noteholders' Guaranties") dated as of December 1, 2001, pursuant to which
such Subsidiary Guarantor will irrevocably, absolutely and unconditionally
guarantee to the Noteholders the payment of the principal of, premium, if any,
and interest on the Notes and the payment and performance of all other
obligations of the Company under the Note Purchase Agreement.
C. Under and pursuant to that certain Bank Credit Agreement dated as
of _____________ (as such agreement may be modified or amended, including any
increase in the amount thereof and the addition of any lending institution which
may become a Lender (as defined below) and including any replacement, additional
or successor agreement or agreements thereto, the "Credit Agreement") between
the Company and various lending institutions (individually a "Lender" and
collectively the "Lenders"), the Lenders have made available to the Company
certain credit facilities in a current aggregate principal amount up to
$______________ (all amounts outstanding in respect of said credit facilities
being hereinafter collectively referred to as the "Loans").
D. In connection with the execution of the Credit Agreement and as
security for the Loans made thereunder, the Subsidiary Guarantors have
heretofore guaranteed to the Lenders the payment of the Loans and all other
obligations of the Company under the Credit Agreement under that certain
guaranty agreement (as such agreement may be modified, amended, renewed or
replaced, including any increase in the amount thereof, the "Lenders'
Guaranty").
Intercreditor Agreement
E. The Lenders' Guaranty and the Noteholders' Guaranty are each
hereinafter individually referred to as a "Subsidiary Guaranty" and
collectively referred to as the "Subsidiary Guaranties."
F. The Company and the Subsidiary Guarantors contemplate that from
time to time after the date hereof, additional subsidiaries of the Company may,
subject to the terms and conditions of the Credit Agreement and the Note
Purchase Agreement, issue additional guaranties which the Company, the
Subsidiary Guarantors and the Creditors wish to become subject to this
Intercreditor Agreement pursuant to the requirements of ss.3.4 hereof.
G. Pursuant to the requirements of Section 9.9 of the Note Purchase
Agreement, the Company has requested and the Lenders and the Noteholders have
agreed that the Bank Closing Date has occurred and, accordingly, the Lenders
under the New Bank Agreement and the Noteholders hereby enter into this
Agreement effective as of the Bank Closing Date.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the sufficiency and receipt of which are hereby
acknowledged, the parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS.
The following terms shall have the meanings assigned to them below in
this ss.1 or in the provisions of this Agreement referred to below:
"Additional Guarantors" shall mean the Subsidiaries which are intended
to be subject to this Intercreditor Agreement pursuant to the requirements of
ss.3.4 hereof.
"Bank Closing Date" shall have the meaning set forth in the Note
Purchase Agreement.
"Company" shall have the meaning assigned thereto in the Recitals
hereof.
"Credit Agreement" shall have the meaning assigned thereto in the
Recitals hereof.
"Creditor" shall individually mean any Lender or Noteholder and
"Creditors" shall mean all of the Lenders and the Noteholders.
"Excess Subsidiary Payment" shall mean as to any Creditor an amount
equal to the Subsidiary Payment received by such Creditor less the Pro Rata
Share of Subsidiary Payments to which such Creditor is then entitled.
"Lender" and "Lenders" shall have the meanings assigned thereto in the
Recitals hereto.
"Lenders Guaranty" shall have the meanings assigned thereto in the
Recitals hereof.
"Loans" shall have the meaning assigned thereto in the Recitals
hereof.
-2-
Intercreditor Agreement
"New Bank Agreement" shall have the meaning set forth in the Note
Purchase Agreement.
"Note Purchase Agreement" shall have the meaning assigned thereto in
the Recitals hereof.
"Noteholder" or Noteholders" shall have the meanings assigned thereto
in the Recitals hereof.
"Noteholders' Guaranty" and "Noteholders' Guaranties" shall have the
meaning assigned thereto in the Recitals hereof.
"Notes" shall have the meaning assigned thereto in the Recitals
hereof.
"Person" shall mean an individual, partnership, limited liability
company, corporation, trust or unincorporated organization, and a government or
agency or political subdivision thereof.
"Pro Rata Share of Subsidiary Payments" shall mean as of the date of
any Subsidiary Payment to a Creditor in respect to a Subsidiary Agreement an
amount equal to the product obtained by multiplying (a) the amount of all
Subsidiary Payments made by the Subsidiary Guarantors to all Creditors less all
reasonable costs incurred by such Creditors in connection with the collection of
such Subsidiary Payments by (b) a fraction, the numerator of which shall be the
Specified Amount owing to such Creditor, and the denominator of which is the
aggregate amount of all outstanding Subject Obligations (without giving effect
in the denominator to the application of any such Subsidiary Payments).
"Receiving Creditor" shall have the meaning assigned thereto in ss.2.
"Specified Amount" shall mean as to any Creditor the aggregate amount
of the Subject Obligations owed to such Creditor.
"Subject Obligations" shall mean all principal of, premium, if any,
and interest on, the Notes and the Loans and all other payment obligations of
the Company under or in respect of the Notes and the Loans and under the Note
Purchase Agreement or the Credit Agreement and any other payment obligations of
the Company to the Lenders which are guaranteed by the Lenders' Guaranty.
"Subsidiary Agreements" shall mean the Subsidiary Guaranties.
"Subsidiary Guarantor" and "Subsidiary Guarantors" shall have the
meaning assigned thereto in the Recitals hereof.
"Subsidiary Guaranty" and "Subsidiary Guaranties" shall have the
meanings assigned thereto in the Recitals hereof.
"Subsidiary Payment" shall have the meaning assigned thereto in ss.2.
-3-
Intercreditor Agreement
SECTION 2. SHARING OF RECOVERIES.
Each Creditor hereby agrees with each other Creditor that payments
(including payments made through setoff of deposit balances or otherwise or
payments or recoveries from any security interest granted to any Creditor) made
pursuant to the terms of the Subsidiary Agreements (a "Subsidiary Payment")
shall be shared so that each Creditor shall receive its Pro Rata Share of
Subsidiary Payments. Accordingly, each Creditor hereby agrees that in the event
(i) any Creditor shall receive a Subsidiary Payment (a "Receiving Creditor") and
(ii) any other Creditor shall not concurrently receive its Pro Rata Share of
Subsidiary Payments from such Subsidiary Guarantor, then the Receiving Creditor
shall promptly remit the Excess Subsidiary Payment to each other Creditor who
shall then be entitled thereto so that after giving effect to such payment (and
any other payments then being made by any other Receiving Creditor pursuant to
this ss.2) each Creditor shall have received its Pro Rata Share of Subsidiary
Payments.
Any such payments shall be deemed to be and shall be made in
consideration of the purchase for cash at face value, but without recourse,
ratably from the other Creditors such amount of Notes or Loans (or interest
therein), as the case may be, to the extent necessary to cause such Receiving
Creditor to share such Excess Subsidiary Payment with the other Creditors as
hereinabove provided; provided, however, that if any such purchase or payment is
made by any Receiving Creditor and if such Excess Subsidiary Payment or part
thereof is thereafter recovered from such Receiving Creditor by such Subsidiary
Guarantor (including, without limitation, by any trustee in bankruptcy of such
Subsidiary Guarantor or any creditor thereof), the related purchase from the
other Creditors shall be rescinded ratably and the purchase price restored as to
the portion of such Excess Subsidiary Payment so recovered, but without
interest; and provided further nothing herein contained shall obligate any
Creditor to resort to any setoff, application of deposit balance or other means
of payment under any Subsidiary Agreement or avail itself of any recourse by
resort to any property of the Company or any Subsidiary Guarantor, the taking of
any such action to remain within the absolute discretion of such Creditor
without obligation of any kind to the other Creditors to take any such action.
In the event a Creditor shall determine that it is reasonably necessary to
evidence the purchase of Notes or Loans (or an interest therein) by such
Creditor pursuant to the foregoing provisions of this paragraph, the seller
thereof upon the request of such Creditor shall take such action as shall be
necessary to document such purchase.
SECTION 3. AGREEMENTS AMONG THE CREDITORS.
Section 3.1. Independent Actions by Creditors. Nothing contained in
this Agreement shall prohibit any Creditor from accelerating the maturity of, or
demanding payment from a Subsidiary Guarantor on, any Subject Obligation of the
Company to such Creditor or from instituting legal action against the Company or
a Subsidiary Guarantor to obtain a judgment or other legal process in respect of
such Subject Obligation, but any funds received from a Subsidiary Guarantor in
connection with any recovery therefrom shall be subject to the terms of this
Agreement.
Section 3.2. Relation of Creditors. This Agreement is entered into
solely for the purposes set forth herein, and no Creditor assumes any
responsibility to any other party hereto to
-4-
Intercreditor Agreement
advise such other party of information known to such other party regarding the
financial condition of the Company or a Subsidiary Guarantor or of any other
circumstances bearing upon the risk of nonpayment of the Subject Obligation.
Each Creditor specifically acknowledges and agrees that nothing contained in
this Agreement is or is intended to be for the benefit of the Company or a
Subsidiary Guarantor and nothing contained herein shall limit or in any way
modify any of the obligations of the Company or any Subsidiary Guarantor to the
Creditors.
Section 3.3. Acknowledgment of Guaranties. The Lenders hereby
expressly acknowledge the existence of the Noteholders' Guaranty and the
Noteholders hereby expressly acknowledge the existence of the Lenders' Guaranty.
Section 3.4. Additional Guarantors. Additional Persons may become
"Subsidiary Guarantors" hereunder by executing and delivering to a then existing
Creditor a guaranty by which such Person has become a guarantor of the Notes or
Loans pursuant to the terms of the Credit Agreement or the Note Purchase
Agreement. Accordingly, upon the execution and delivery of any such copy of the
guaranty by any such Person, such Person shall, thereinafter become a
"Subsidiary Guarantor" for all purposes of this Agreement.
Section 3.5. Additional Lenders. Additional Persons may become
"Lenders" hereunder, provided that any such Person shall sign an acknowledgement
in the form of Exhibit A attached hereto, by which such Person agrees to be
bound by the terms of this Agreement and such Person shall deliver to the
Company for distribution to each of the then existing Creditors a copy of such
acknowledgement so executed.
SECTION 4. MISCELLANEOUS.
Section 4.1. Entire Agreement. This Agreement represents the entire
Agreement among the Creditors and, except as otherwise provided, this Agreement
may not be altered, amended or modified except in a writing executed by all the
parties to this Agreement.
Section 4.2. Notices. Notices hereunder shall be given to the
Creditors at their addresses as set forth in the Note Purchase Agreement or the
Credit Agreement, as the case may be, or at such other address as may be
designated by each in a written notice to the other parties hereto.
Section 4.3. Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of each of the Creditors and their respective
successors and assigns, whether so expressed or not, and, in particular, shall
inure to the benefit of and be enforceable by any future holder or holders of
any Subject Obligations, and the term "Creditor" shall include any such
subsequent holder of Subject Obligations, wherever the context permits.
Section 4.4. Consents, Amendment, Waivers. All amendments, waivers or
consents of any provision of this Agreement shall be effective only if the same
shall be in writing and signed by all of the Creditors.
SECTION 4.5. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
-5-
Intercreditor Agreement
Section 4.6. Counterparts. This Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one
Agreement, and any of the parties hereto may execute this Agreement by signing
any such counterpart.
Section 4.7. Sale of Interest. No Creditor will sell, transfer or
otherwise dispose of any interest in the Subject Obligations unless such
purchaser or transferee shall agree, in writing, to be bound by the terms of
this Agreement.
Section 4.8. Severability. In case any one or more of the provisions
contained in this Agreement shall be invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions
of this Agreement shall not in any way be affected or impaired thereby.
Section 4.9. Expenses. In the event of any litigation to enforce this
Agreement, the prevailing party shall, if not reimbursed by the Company, be
entitled to its reasonable attorney's fees (including the allocated costs of
in-house counsel).
Section 4.10. Term of Agreement. This Agreement shall terminate when
all Subject Obligations are paid in full and such payments are not subject to
any possibility of revocation or rescission or until all of the parties hereto
mutually agree in a writing to terminate this Agreement.
-6-
Intercreditor Agreement
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed as of the date first above written.
[VARIATION]
By
Name_____________________________
Title____________________________
-7-
Intercreditor Agreement
The undersigned hereby acknowledge and agree to the foregoing
Agreement.
[VARIATION]
By
Name_____________________________
Title____________________________
-8-
EXECUTION BY ADDITIONAL LENDER
The undersigned hereby acknowledges and agrees to the foregoing
Agreement and executes and delivers this Agreement and agrees to become a party
thereto with all the rights, benefits and obligations of a Lender (as defined in
the Agreement) all as of the date hereof __________, ______.
The undersigned Lender has entered into the following facility with
the Company [insert description of debt facility of the Company] which is
guaranteed by a Subsidiary Guarantor pursuant to [insert description of guaranty
agreement].
[LENDER]
By ______________________________
Its
EXHIBIT A
(to Intercreditor Agreement)
DESCRIPTION OF OPINION OF SPECIAL COUNSEL
TO THE COMPANY
December __, 2001
To the Purchasers named on
the attached Schedule
Ladies and Gentlemen:
We have acted as counsel to Otter Tail Corporation, a Minnesota
corporation (the "Company"), in connection with the transactions contemplated by
that certain Note Purchase Agreement (the "Note Purchase Agreement") dated as of
December 1, 2001 between the Company and you relating to the issuance and sale
by the Company on the date hereof of $90,000,000 aggregate principal amount of
the Company's 6.63% Senior Notes due 2011 (the "Notes"). This opinion is being
delivered to you pursuant to Section 4.4(a) of the Note Purchase Agreement.
Capitalized terms used herein, except as otherwise specifically defined herein,
are used with the same meaning as defined in the Note Purchase Agreement.
In connection with this opinion, we have examined the following
documents:
(a) The Restated Articles of Incorporation of the
Company, as amended, certified by the Secretary of State of the State
of Minnesota (the "Articles");
(b) The Restated Bylaws of the Company, as amended,
certified by its Secretary (the "Bylaws");
(c) Resolutions of the Board of Directors of the Company
adopted on October 22, 2001 (the "Resolutions"), certified by the
Secretary of the Company;
(d) An executed copy of the Note Purchase Agreement;
(e) An executed copy of the Notes;
(f) An executed copy of the Guaranty Agreement dated as
of December 1, 2001 (the "Guaranty Agreement"), entered into by each
of the Subsidiary Guarantors; and
(g) The other documents delivered in connection with the
closing of the sale of the Notes on the date hereof.
Exhibit 4.4(a)
(to Note Purchase Agreement)
We also have examined such other documents and reviewed such questions
of law as we have considered necessary and appropriate for the purposes of this
opinion.
In rendering our opinions set forth below, we have assumed the
authenticity of all documents submitted to us as originals, the genuineness of
all signatures and the conformity to authentic originals of all documents
submitted to us as copies. We have also assumed the legal capacity for all
purposes relevant hereto of all natural persons and, with respect to all parties
to agreements or instruments relevant hereto other than the Company, that such
parties had the requisite power and authority (corporate or otherwise) to
execute, deliver and perform such agreements or instruments, that such
agreements or instruments have been duly authorized by all requisite action
(corporate or otherwise), executed and delivered by such parties and, except for
the opinions given in paragraph (iv) below, that such agreements or instruments
are the valid, binding and enforceable obligations of such parties. As to
questions of fact material to our opinion, we have relied upon certificates of
officers of the Company and of public officials.
Our opinions expressed below as to certain factual matters are
qualified as being limited "to our knowledge" or by other words to the same or
similar effect. Such words, as used herein, mean that prior to or during the
course of this firm's representation of the Company in connection with the
specific transactions contemplated by the Note Purchase Agreement, no contrary
information came to the attention of ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ or ▇▇▇▇▇
▇. ▇▇▇▇▇▇, the attorneys in our firm who have principally represented the
Company in connection with the transactions contemplated by the Note Purchase
Agreement. In rendering such opinions, we have not conducted any independent
investigation of the Company, consulted with other attorneys in our firm with
respect to the matters covered thereby, or reviewed any of our prior files
involving the Company. Finally, no inference as to our knowledge with respect to
the factual matters upon which we have so qualified our opinions should be drawn
from the fact of our representation of the Company.
Based on the foregoing, we are of the opinion that:
(i) The Company is a corporation, duly incorporated, validly
existing and in good standing under the laws of the State of Minnesota,
has the corporate power and the corporate authority to execute and
perform the Note Purchase Agreement and to issue the Notes and has the
corporate power and the corporate authority to conduct the activities
in which it is now engaged, as described in the Memorandum, and is duly
licensed or qualified and is in good standing as a foreign corporation
in each jurisdiction in which the character of the properties owned or
leased by it or the nature of the business transacted by it makes such
licensing or qualification necessary, except where the failure to be so
licensed or so to qualify or to be in good standing would not result in
a Material Adverse Effect.
(ii) The Note Purchase Agreement has been duly authorized,
executed and delivered by the Company and constitutes a legal, valid
and binding agreement of the Company enforceable against the Company in
accordance with its terms.
E 4.4(a)-2
(iii) The Notes have been duly authorized, executed and
delivered by the Company and constitute the legal, valid and binding
obligations of the Company enforceable against the Company in
accordance with their terms.
(iv) The Guaranty Agreement constitutes a legal, valid and
binding agreement of each of the Subsidiary Guarantors named as a party
thereto, enforceable against such Subsidiary Guarantor in accordance
with its terms.
(v) No prior approval, consent or withholding of objection on
the part of, or filing, registration or qualification with, any
Minnesota, New York or federal governmental authority is required to be
obtained or made by the Company in connection with the execution and
delivery of the Note Purchase Agreement or the Notes, except such as
have been obtained or made.
(vi) Neither the issuance and sale of the Notes nor the
execution, delivery and performance by the Company of the Note Purchase
Agreement and the Notes (a) conflicts with or results in any breach of
any of the provisions of or constitutes a default under or results in
the creation or imposition of any lien or encumbrance upon any of the
property of the Company pursuant to (1) the provisions of the Articles
or Bylaws or (2) any indenture, mortgage, lease, agreement, instrument,
license, permit, order, judgment or decree known to us by which the
Company is bound or to which its properties and assets are subject,
except for any such conflict, breach, default, lien or encumbrance
which would not result in a Material Adverse Effect, or (b) results in
the contravention of any law, rule or regulation as to which the
Company or its properties or assets or any thereof are subject.
(vii) Assuming the accuracy and performance of, and compliance
with, the representations, warranties and agreements of the Company and
you in the Note Purchase Agreement, the issuance, sale and delivery of
the Notes under the circumstances contemplated by the Note Purchase
Agreement do not, under existing law, require the registration of the
Notes under the Securities Act of 1933, as amended, or the
qualification of an indenture under the Trust Indenture Act of 1939, as
amended.
(viii) The issuance of the Notes and the use of the proceeds of
the sale of the Notes in accordance with the provisions of and
contemplated by the Note Purchase Agreement do not violate or conflict
with Regulation T, U or X of the Board of Governors of the Federal
Reserve System.
(ix) The Company is not an "investment company" or a company
"controlled" by an "investment company" under the Investment Company
Act of 1940, as amended.
The opinions set forth above are subject to the following
qualifications and exceptions:
(a) Our opinions above are subject to the effect of
bankruptcy, insolvency, reorganization, arrangement, moratorium,
fraudulent transfer, statutes of limitation or
E 4.4(a)-3
other similar laws and judicial decisions affecting or relating to the
rights of creditors generally.
(b) Our opinions above are subject to the effect of general
principles of equity, including without limitation, concepts of
materiality, reasonableness, good faith and fair dealing, estoppel,
election of remedies and other similar doctrines affecting the
enforceability of agreements generally (regardless of whether
considered in a proceeding in equity or at law). In addition, the
availability of specific performance, injunctive relief, the
appointment of a receiver or other equitable remedies is subject to the
discretion of the tribunal before which any proceeding therefor may be
brought.
(c) We express no opinion as to the enforceability of
provisions in the Note Purchase Agreement to the extent it contains
obligations of the Company to pay any prepayment premium, default
interest rate or other form of liquidated damages if the payment of
such premium, interest rate or damages may be construed as unreasonable
in relation to the actual damages or disproportionate to actual damages
suffered by the Purchaser as a result of such prepayment or default.
(d) We express no opinion as to the enforceability of any
Bank Credit Agreement which may be deemed to be incorporated by
reference into the Note Purchase Agreement pursuant to Section 10.7 of
the Note Purchase Agreement or as to the effect such incorporation may
have on the enforceability of the Note Purchase Agreement, the Notes or
the Guaranty Agreement.
(e) Our opinion in paragraph (iv) above as to the Guaranty
Agreement is subject to the defenses available to a guarantor under
applicable law.
(f) We express no opinion as to the validity, binding effect
or enforceability of any provision of the Note Purchase Agreement or
the Guaranty Agreement related to choice of law, forum selection or
submission to jurisdiction (including, without limitation, any express
or implied waiver of any objection to venue in any court or of any
objection that a court is an inconvenient forum) to the extent that the
validity, binding effect or enforceability of any such provision is to
be determined by any court other than a court of the State of New York.
The opinions expressed above are limited to the laws of the States of
Minnesota and New York and the federal laws of the United States and we express
no opinion as to the laws of any other jurisdiction.
The foregoing opinions are being furnished to you solely for your
benefit and the benefit of your successors and assigns and may not be relied
upon by, nor may copies be delivered to, any other person without our prior
written consent.
Very truly yours,
E 4.4(a)-4
DESCRIPTION OF OPINION OF GENERAL COUNSEL
OF THE COMPANY
December __, 2001
To the Purchasers named on
the attached Schedule
Ladies and Gentlemen:
I have acted as in-house counsel to Otter Tail Corporation, a Minnesota
corporation (the "Company"), in connection with the transactions contemplated by
that certain Note Purchase Agreement (the "Note Purchase Agreement") dated as of
December 1, 2001 between the Company and you relating to the issuance and sale
by the Company on the date hereof of $90,000,000 aggregate principal amount of
the Company's 6.63% Senior Notes due 2011 (the "Notes"). This opinion is being
delivered to you pursuant to Section 4.4(b) of the Note Purchase Agreement.
Capitalized terms used herein, except as otherwise specifically defined herein,
are used with the same meaning as defined in the Note Purchase Agreement.
In connection with this opinion, I have examined the following
documents:
(a) The Articles or Certificate of Incorporation of the
Company, each of the Subsidiary Guarantors and each of the
Subsidiaries;
(b) The Bylaws of the Company, each of the Subsidiary
Guarantors and each of the Subsidiaries;
(c) Resolutions of the Board of Directors of each of the
Subsidiary Guarantors;
(d) An executed copy of the Note Purchase Agreement;
(e) An executed copy of the Notes;
(f) An executed copy of the Guaranty Agreement dated as
of December 1, 2001, entered into by each of the Subsidiary Guarantors
(the "Guaranty Agreement"); and
(g) The other documents delivered in connection with the
closing of the sale of the Notes on the date hereof.
I also have examined such other documents and reviewed such questions
of law as I have considered necessary and appropriate for the purposes of this
opinion.
EXHIBIT 4.4(b)
(to Note Purchase Agreement)
In rendering my opinions set forth below, I have assumed the
authenticity of all documents submitted to me as originals, the genuineness of
all signatures (other than the signatures of officers of the Company and the
Subsidiary Guarantors) and the conformity to authentic originals of all
documents submitted to me as copies. I also have assumed the legal capacity for
all purposes relevant hereto of all natural persons (other than officers of the
Company and Subsidiary Guarantors) and, with respect to all parties to
agreements or instruments relevant hereto other than the Company and Subsidiary
Guarantors, that such parties had the requisite power and authority (corporate
or otherwise) to execute, deliver and perform such agreements or instruments,
that such agreements or instruments have been duly authorized by all requisite
action (corporate or otherwise), executed and delivered by such parties and that
such agreements or instruments are the valid, binding and enforceable
obligations of such parties. As to questions of fact material to my opinion, I
have relied upon representations and certificates of officers and other
employees of the Company (known by me to have authority to make such
representations and certifications on behalf of the Company) and its
Subsidiaries and certificates of public officials.
Based on the foregoing, I am of the opinion that:
(i) Each Subsidiary is a corporation duly organized, validly
existing and in good standing under the laws of its jurisdiction of
incorporation and is duly licensed or qualified and is in good standing
in each jurisdiction in which the character of the properties owned or
leased by it or the nature of the business transacted by it makes such
licensing or qualification necessary, except where failure to be so
licensed or so to qualify or to be in good standing would not result in
a Material Adverse Effect; and all of the issued and outstanding shares
of capital stock of each Subsidiary have been duly issued, are fully
paid and non-assessable and are owned by the Company, by one or more
Subsidiaries, or by the Company and one or more Subsidiaries.
(ii) No prior approval, consent or withholding of objection on
the part of, or filing, registration or qualification with, any North
Dakota governmental authority is required to be obtained or made by the
Company in connection with the execution and delivery of the Note
Purchase Agreement or the Notes, except such as have been obtained or
made.
(iii) No prior approval, consent or withholding of objection on
the part of, or filing, registration or qualification with, any
Minnesota, North Dakota or federal governmental authority is required
to be obtained or made by the Subsidiary Guarantors in connection with
the execution and delivery of the Guaranty Agreement, except such as
have been obtained or made.
(iv) Each of the Subsidiary Guarantors has the corporate power
and authority and is duly authorized to enter into and perform all of
its obligations under the Guaranty Agreement and the Guaranty Agreement
has been duly authorized, executed and delivered by each of the
Subsidiary Guarantors.
E-4.4(B)-2
(v) The execution, delivery and performance by each of the
Subsidiary Guarantors of the Guaranty Agreements does not (a) conflict
with or result in any breach of any of the provisions of or constitute
a default under or result in the creation or imposition of any lien or
encumbrance upon any of the property of the Company or any Subsidiary
Guarantor pursuant to (1) the provisions of the Articles of
Incorporation or Bylaws of the Company or any Subsidiary Guarantor or
(2) any indenture, mortgage, lease, agreement, instrument, license,
permit, order, judgment or decree by which the Company or any
Subsidiary Guarantor is bound or to which their properties and assets
are subject, except for any such conflict, breach, default, lien or
encumbrance which would not result in a Material Adverse Effect, or (b)
result in the contravention of any law, rule or regulation as to which
the Company or any Subsidiary Guarantor is or their properties or
assets or any thereof are subject.
(vi) There is no litigation pending or, to the best of my
knowledge, threatened which in my opinion could reasonably be expected
to have a Material Adverse Effect on the Company or any Subsidiary or
which would impair the ability of the Company to issue and deliver the
Notes or to comply with the provisions of the Note Purchase Agreement
or of any Subsidiary Guarantor to comply with the provisions of the
Guaranty Agreement.
The opinions expressed above are limited to the laws of the States of
Minnesota and North Dakota and the federal laws of the United States and I
express no opinion as to the laws of any other jurisdiction.
The foregoing opinions are being furnished to you solely for your
benefit and the benefit of your successors and assigns and may not be relied
upon by, nor may copies be delivered to, any other person without my prior
written consent.
Very truly yours,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
General Counsel and Corporate Secretary
E-4.4(B)-3
DESCRIPTION OF OPINION OF SPECIAL COUNSEL
TO THE PURCHASERS
The closing opinion of ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇, special counsel to the
Purchasers, called for by Section 4.4(b) of the Note Purchase Agreement, shall
be dated the date of the Closing and addressed to the Purchasers, shall be
satisfactory in form and substance to the Purchasers and shall be to the effect
that:
1. The Company is a corporation, validly existing and in
good standing under the laws of the State of Minnesota and has the
corporate power and the corporate authority to execute and deliver the
Note Purchase Agreements and to issue the Notes.
2. The Note Purchase Agreement has been duly authorized by
all necessary corporate action on the part of the Company, has been
duly executed and delivered by the Company and constitutes the legal,
valid and binding contract of the Company enforceable in accordance
with its terms, subject to bankruptcy, insolvency, fraudulent
conveyance and similar laws affecting creditors' rights generally, and
general principles of equity (regardless of whether the application of
such principles is considered in a proceeding in equity or at law).
3. The Notes have been duly authorized by all necessary
corporate action on the part of the Company, and the Notes being
delivered on the date hereof have been duly executed and delivered by
the Company and constitute the legal, valid and binding obligations of
the Company enforceable in accordance with their terms, subject to
bankruptcy, insolvency, fraudulent conveyance and similar laws
affecting creditors' rights generally, and general principles of equity
(regardless of whether the application of such principles is considered
in a proceeding in equity or at law).
4. The issuance, sale and delivery of the Notes under the
circumstances contemplated by the Note Purchase Agreement do not, under
existing law, require the registration of the Notes under the
Securities Act of 1933, as amended, or the qualification of an
indenture under the Trust Indenture Act of 1939, as amended.
The opinion of ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ shall also state that the opinions of
▇▇▇▇▇▇ & Whitney LLP and General Counsel of the Company are each satisfactory in
scope and form to ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ and that, in their opinion, the Purchasers
are justified in relying thereon.
EXHIBIT 4.4(c)
(to Note Purchase Agreement)
Otter Tail Corporation Note Purchase Agreement
In rendering the opinion set forth in paragraph 1 above, ▇▇▇▇▇▇▇ and
▇▇▇▇▇▇ may rely solely upon an examination of the Articles of Incorporation
certified by, and a certificate of good standing of the Company from, the
Secretary of State of the State of Minnesota, the By-laws of the Company and the
general business corporation law of the State of Minnesota. The opinion of
▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ is limited to the laws of the State of New York, the general
business corporation law of the State of Minnesota and the Federal laws of the
United States.
With respect to matters of fact upon which such opinion is based, ▇▇▇▇▇▇▇ and
▇▇▇▇▇▇ may rely on appropriate certificates of public officials and officers of
the Company and upon representations of the Company and the Purchasers delivered
in connection with the issuance and sale of the Notes.
E-4.4(c)-2