Exhibit 4.3
CONFORMED COPY
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▇▇▇▇▇▇ CORPORATION
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NOTE ASSUMPTION AND EXCHANGE AGREEMENT
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providing for the assumption by ▇▇▇▇▇▇ Corporation of
certain notes of ▇▇▇▇▇ Telecom, Inc. and the exchange by ▇▇▇▇▇▇ Corporation of
its
$3,000,000.00
6.60% Senior Notes, Series 2003-A
due November 14, 2003
$39,166,666.90
6.65% Senior Notes, Series 2003-B
due November 14, 2007
and
$9,000,000.00
6.74% Senior Notes, Series 2003-C
due November 14, 2007
therefor
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DATED AS OF JULY 15, 2003
Series 2003-A PPN: 03442# AA 4
Series 2003-B PPN: 03442# AB 2
Series ▇▇▇▇-▇ ▇▇▇: 03442# AC 0
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TABLE OF CONTENTS
Section Page
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1. ASSUMPTION OF EXISTING NOTES...........................................................2
2. AUTHORIZATION OF NOTES.................................................................2
3. CLOSING OF EXCHANGE OF NOTES...........................................................2
4. CONDITIONS OF RESTATEMENT, CONSENT AND RELEASE.........................................3
4.1. Representations and Warranties.................................................3
4.2. Performance; No Default........................................................3
4.3. Compliance Certificates........................................................3
4.4. Opinions of Counsel............................................................3
4.5. Purchase Permitted By Applicable Law, etc......................................4
4.6. Issuance of Other Notes........................................................4
4.7. Payment of Special Counsel Fees................................................4
4.8. Private Placement Number.......................................................4
4.9. Changes in Corporate Structure.................................................4
4.10. Amendment Fee..................................................................5
4.11. Consummation of Merger.........................................................5
4.12. Amendment to Credit Agreement..................................................5
4.13. Termination of ▇▇▇▇▇ Credit Agreement..........................................5
4.14. Proceedings and Documents......................................................5
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY..........................................5
5.1. Organization; Power and Authority..............................................5
5.2. Authorization, etc.............................................................6
5.3. Disclosure.....................................................................6
5.4. Organization and Ownership of Shares of Subsidiaries; Affiliates...............6
5.5. Financial Statements...........................................................7
5.6. Compliance with Laws, Other Instruments, etc...................................7
5.7. Governmental Authorizations, etc...............................................8
5.8. Litigation; Observance of Agreements, Statutes and Orders......................8
5.9. Taxes..........................................................................8
5.10. Title to Property; Leases......................................................9
5.11. Licenses, Permits, etc.........................................................9
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5.12. Compliance with ERISA...........................................................9
5.13. Private Offering by the Company................................................10
5.14. Use of Proceeds; Margin Regulations............................................10
5.15. Existing Indebtedness; Future Liens............................................11
5.16. Foreign Assets Control Regulations, etc........................................11
5.17. Status under Certain Statutes..................................................11
5.18. Environmental Matters..........................................................11
6. REPRESENTATIONS OF THE PURCHASERS......................................................12
6.1. Purchase for Investment........................................................12
6.2. Source of Funds................................................................13
7. INFORMATION AS TO COMPANY..............................................................14
7.1. Financial and Business Information.............................................14
7.2. Officer's Certificate..........................................................16
7.3. Inspection.....................................................................17
8. PREPAYMENT OF THE NOTES................................................................17
8.1. Required Prepayments...........................................................17
8.2. Optional Prepayments with Make-Whole Amount....................................17
8.3. Allocation of Partial Prepayments..............................................18
8.4. Maturity; Surrender, etc.......................................................18
8.5. Purchase of the Notes..........................................................18
8.6. Make-Whole Amount..............................................................19
9. AFFIRMATIVE COVENANTS..................................................................20
9.1. Compliance with Law............................................................20
9.2. Insurance......................................................................20
9.3. Maintenance of Properties......................................................20
9.4. Payment of Taxes and Claims....................................................21
9.5. Corporate Existence, etc.......................................................21
9.6. Subsidiary Guaranty Agreements.................................................21
10. NEGATIVE COVENANTS.....................................................................22
10.1. Consolidated Indebtedness; Indebtedness of Subsidiaries........................22
10.2. Liens..........................................................................22
10.3. Sale of Assets.................................................................24
10.4. Mergers, Consolidations, etc...................................................24
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10.5. Disposition of Stock of Subsidiaries...........................................25
10.6. [Intentionally Omitted]........................................................25
10.7. Nature of Business.............................................................25
10.8. Transactions with Affiliates...................................................26
11. EVENTS OF DEFAULT......................................................................26
12. REMEDIES ON DEFAULT, ETC...............................................................28
12.1. Acceleration...................................................................28
12.2. Other Remedies.................................................................28
12.3. Rescission.....................................................................29
12.4. No Waivers or Election of Remedies, Expenses, etc..............................29
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES..........................................29
13.1. Registration of Notes..........................................................29
13.2. Transfer and Exchange of Notes.................................................30
13.3. Replacement of Notes...........................................................30
14. PAYMENTS ON THE NOTES..................................................................31
14.1. Place of Payment...............................................................31
14.2. Home Office Payment............................................................31
15. EXPENSES, ETC..........................................................................31
15.1. Transaction Expenses...........................................................31
15.2. Survival.......................................................................32
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT...........................32
17. AMENDMENT AND WAIVER...................................................................32
17.1. Requirements...................................................................32
17.2. Solicitation of Holders of the Notes...........................................33
17.3. Binding Effect, etc............................................................33
17.4. Notes held by Company, etc.....................................................33
18. NOTICES................................................................................34
19. REPRODUCTION OF DOCUMENTS..............................................................34
20. CONFIDENTIAL INFORMATION...............................................................34
21. [INTENTIONALLY OMITTED]................................................................35
22. MISCELLANEOUS..........................................................................35
22.1. Successors and Assigns.........................................................35
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22.2. Payments Due on Non-Business Days..............................................36
22.3. Severability...................................................................36
22.4. Construction...................................................................36
22.5. Counterparts...................................................................36
22.6. Governing Law..................................................................36
22.7. Amendment and Restatement of Existing Note Agreement, Consent and Release......36
SCHEDULE A -- Information Relating to Purchasers
SCHEDULE B -- Defined Terms
SCHEDULE B-1 -- Outstanding Investments
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 -- Licenses, Permits, etc.
SCHEDULE 5.14 -- Use of Proceeds
SCHEDULE 5.15 -- Existing Indebtedness
SCHEDULE 10.2 -- Existing Liens
EXHIBIT 2(a) -- Form of Series 2003-A Note
EXHIBIT 2(b) -- Form of Series 2003-B Note
EXHIBIT 2(c) -- Form of Series 2003-C Note
EXHIBIT 4.4(a) -- Form of Opinion of Counsel for the Company
EXHIBIT 4.4(b) -- Form of Tax Opinion of Counsel for the Company
EXHIBIT 4.4(c) -- Form of Opinion of Special Counsel for the Purchasers
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▇▇▇▇▇▇ CORPORATION
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Dated as of July 15, 2003
TO EACH OF THE PURCHASERS LISTED
IN THE ATTACHED SCHEDULE A:
Ladies and Gentlemen:
The undersigned, ▇▇▇▇▇▇ Corporation, a Delaware corporation (the
"COMPANY"), and ▇▇▇▇▇ Telecom Inc., a Delaware corporation ("▇▇▇▇▇"), hereby
agree with the purchasers named in the Purchaser Schedule attached hereto (the
"PURCHASERS") as set forth below:
INTRODUCTION
▇▇▇▇▇ and the Purchasers are parties to the Note Agreement, dated as of
November 1, 1997 (the "EXISTING NOTE AGREEMENT"), under which ▇▇▇▇▇ issued, and
there are now outstanding and held by the Purchasers, ▇▇▇▇▇'▇ 6.60% Senior
Notes, Series 1997-A, due November 14, 2003, originally issued in the aggregate
principal amount of $9,000,000 of which an aggregate principal amount of
$3,000,000.00 is outstanding on the date hereof (the "SERIES 1997-A NOTES"),
6.65% Senior Notes, Series 1997-B, due November 14, 2007, originally issued in
the aggregate principal amount of $47,000,000 of which an aggregate principal
amount of $39,166,666.90 is outstanding on the date hereof (the "SERIES 1997-B
NOTES") and 6.74% Senior Notes, Series 1997-C, due November 14, 2007, originally
issued in the aggregate principal amount of $9,000,000 of which an aggregate
principal amount of $9,000,000.00 is outstanding on the date hereof (the "SERIES
1997-C NOTES") (the Series 1997-A Notes, the Series 1997-B Notes and the Series
1997-C Notes are collectively called the "EXISTING NOTES"). The Company and
▇▇▇▇▇ have advised the Purchasers that the Company, Adirondacks, LLC, a Delaware
limited liability company and a wholly-owned subsidiary of the Company
("ACQUISITION SUB"), and ▇▇▇▇▇ have entered into the Agreement and Plan of
Merger, dated as of February 17, 2003, and Amendment No. 1 to the Agreement and
Plan of Merger effective as of May 29, 2003 (the "MERGER AGREEMENT"), under
which ▇▇▇▇▇ would be merged into Acquisition Sub which would be the survivor
(the "MERGER"). The Company and ▇▇▇▇▇ have further advised the Purchasers that,
in connection with the Merger, the Company and ▇▇▇▇▇ desire that the Company
assume ▇▇▇▇▇'▇ obligations under the Existing Note Agreement and the Existing
Notes, that, upon such assumption, the Existing Note Agreement be amended and
restated to read as set forth in this Agreement and that the Existing Notes be
exchanged for the Notes (as herein defined).
Subject to the terms and conditions hereof, the Purchasers are willing to
agree to such assumption, amendment and restatement, and exchange. Accordingly,
the Company, ▇▇▇▇▇ and the Purchasers agree as follows:
1. ASSUMPTION OF EXISTING NOTES.
The Company hereby irrevocably, absolutely, unconditionally and
expressly assumes (i) the due and punctual payment of all of the principal of,
interest on and Make-Whole Amount (if any) with respect to the Existing Notes
and all other payments due from ▇▇▇▇▇ under or relating to the Existing Notes or
the Existing Note Agreement, and (ii) the due and punctual performance of all
obligations of ▇▇▇▇▇ under the Existing Notes and the Existing Note Agreement.
The Company covenants that its debts, liabilities and obligations assumed
pursuant to this Section 1 shall be those of a primary obligor and not a
guarantor, surety or secondary obligor.
2. AUTHORIZATION OF NOTES.
The Company has authorized the issue of $3,000,000.00 aggregate
principal amount of its senior promissory notes designated as its 6.60% Senior
Notes, Series 2003-A, due November 14, 2003 (the "SERIES 2003-A NOTES") to be
issued in exchange for the existing Series 1997-A Notes, $39,166,666.90
aggregate principal amount of its senior promissory notes designated as its
6.65% Senior Notes, Series 2003-B, due November 14, 2007 (the "SERIES 2003-B
NOTES") to be issued in exchange for the existing Series 1997-B Notes, and
$9,000,000.00 aggregate principal amount of its senior promissory notes
designated as its 6.74% Senior Notes, Series 2003-C, due November 14, 2007 (the
"SERIES 2003-C NOTES") to be issued in exchange for the existing Series 1997-C
Notes (the Series 2003-A Notes, the Series 2003-B Notes and the Series 2003-C
Notes are collectively referred to as the "SERIES 2003 NOTES", such term to
include any such Notes issued in substitution therefor pursuant to Section 13 of
this Agreement). The Series 2003 Notes shall be substantially in the forms set
out in Exhibits 2(a), (b) and (c), respectively, with such changes therefrom, if
any, as may be approved by you and the Company. The term "Notes", as used
herein, shall mean any Series 2003-A Note, any Series 2003-B Note and any Series
2003-B Note, and shall include any such Note issued in substitution therefor
pursuant to Section 13 of this Agreement. 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.
3. CLOSING OF EXCHANGE OF NOTES.
In furtherance of the Company's assumption of the Existing Notes, the
Company agrees to deliver to each Purchaser Notes of the series and in the
aggregate principal amount or amounts set forth opposite such Purchaser's name
in Schedule A attached hereto. The closing of the assumption of the Existing
Notes will be held at the offices of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, at 10:00 AM, CST, at a closing (the "CLOSING"). The
Closing will be held on July 15, 2003, or such other Business Day thereafter
prior to July 31, 2003, as shall be mutually acceptable to the Company and the
Purchasers (the "CLOSING DATE"). At the Closing the Company will deliver to each
Purchaser one or more Notes registered in the name of such Purchaser of the
series and evidencing the aggregate principal amount of the Existing Notes held
by such Purchaser, and in the denomination or denominations, specified for such
Purchaser in Schedule A attached hereto. Each Note shall carry with it the right
to receive any accrued and unpaid interest on the Existing Note for which it was
exchanged so that no gain or loss of interest shall result from such exchange.
The Notes (i) are given in exchange and
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substitution for, and not as payment of the indebtedness evidenced by, the
Existing Notes, (ii) merely re-evidence the indebtedness evidenced by the
Existing Notes assumed by the Company, and (iii) are not intended to constitute
a novation or discharge of the indebtedness evidenced by the Existing Notes.
Promptly after the Closing, each Purchaser agrees to ▇▇▇▇ such Purchaser's
Existing Notes "Replaced" and to return such Existing Notes to the Company.
4. CONDITIONS OF RESTATEMENT, CONSENT AND RELEASE.
The effectiveness of release of ▇▇▇▇▇ from its obligations under the
Existing Notes and the Existing Note Agreement, the amendment and restatement of
the Existing Note Agreement and the consent by the Purchasers pursuant to
Section 22.7 hereof are subject to the satisfaction, on or before the Closing
Date, or waiver in writing by each Purchaser, of each of the following
conditions:
4.1. REPRESENTATIONS AND WARRANTIES.
The representations and warranties of the Company in this Agreement
shall be correct when made and at the time of the Closing.
4.2. PERFORMANCE; NO DEFAULT.
The Company shall have performed and complied with all agreements and
conditions contained in this Agreement required to be performed or complied with
by it prior to or at the Closing and, after giving effect to the issuance of the
Notes, 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 Sections
10.1 through 10.8 had such Sections applied since such date.
4.3. COMPLIANCE CERTIFICATES.
(a) OFFICER'S CERTIFICATE. The Company shall have delivered to you an
Officer's Certificate, dated the date of the Closing, certifying that the
conditions specified in Sections 4.1, 4.2, 4.9, 4.11, 4.12 and 4.13 have
been fulfilled.
(b) SECRETARY'S CERTIFICATE. The Company shall have delivered
to you a certificate certifying as to the resolutions attached thereto and other
corporate proceedings relating to the authorization, execution and delivery of
the Notes and the Agreement.
4.4. OPINIONS OF COUNSEL.
You shall have received opinions in form and substance satisfactory to
you, dated the date of the Closing (a) from ▇▇▇▇▇▇▇, Carton & ▇▇▇▇▇▇▇, counsel
to the Company, covering the matters set forth in Exhibit 4.4(a) and Exhibit
4.4(b)and covering such other matters incident to the transactions contemplated
hereby as you or your counsel may reasonably request (and the Company instructs
its counsel to deliver such opinion to you) and (b) from ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇,
your 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 you may reasonably request.
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4.5. PURCHASE PERMITTED BY APPLICABLE LAW, ETC.
On the date of the Closing the issuance of the Notes shall (i) be
permitted by the laws and regulations of each jurisdiction to which you are
subject, without recourse to provisions (such as Section 1405(a)(8) of the New
York Insurance Law) permitting limited investments by insurance companies
without restriction as to the character of the particular investment, (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 you 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 you, you shall have received an Officer's
Certificate certifying as to such matters of fact as you may reasonably specify
to enable you to determine whether such purchase is so permitted.
4.6. ISSUANCE OF OTHER NOTES.
Contemporaneously with the Closing the Company shall issue to you and
each of the other Purchasers named in Schedule A (the "OTHER PURCHASERS") the
Notes to be issued to them at the Closing as specified in Schedule A.
4.7. PAYMENT OF SPECIAL COUNSEL FEES.
Without limiting the provisions of Section 15.1, the Company shall
have paid on or before the Closing the fees, charges and disbursements of your
special counsel referred to in Section 4.4, to the extent reflected in a
statement of such counsel rendered to the Company at least one Business Day
prior to the Closing.
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
by ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇.
4.9. CHANGES IN CORPORATE STRUCTURE.
Except for the Merger and as contemplated hereby or as specified in
Schedule 4.9, the Company shall not have changed its jurisdiction of
incorporation or been a party to any merger or consolidation and shall not have
succeeded to all or any substantial part of the liabilities of any other entity,
at any time following the date of the most recent financial statements referred
to in Schedule 5.5.
4.10. AMENDMENT FEE.
The Company shall have paid an amendment fee to you in an amount equal
to 0.10% of the aggregate principal amount of the Existing Notes held by you by
the method and at the address specified for payments of principal and interest
on the Note to be held by you set forth below your name on Schedule A.
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4.11. CONSUMMATION OF MERGER.
The ▇▇▇▇▇ Closing Date shall have occurred.
4.12. AMENDMENT TO CREDIT AGREEMENT.
The Company and the Bank Lenders shall have executed and delivered an
amendment to the Credit Agreement, in form and substance satisfactory to you,
all conditions precedent to the effectiveness of such amendment shall have been
satisfied, and such amendment shall be in full force and effect.
4.13. TERMINATION OF ▇▇▇▇▇ CREDIT AGREEMENT.
All obligations of ▇▇▇▇▇ under the Existing ▇▇▇▇▇ Credit Agreement
shall have been discharged, the Existing ▇▇▇▇▇ Credit Agreement shall have been
terminated, and all liens and security interests securing all of such
obligations, and all financing statements or other filing and recordings
relating thereto, shall have been terminated and released.
4.14. PROCEEDINGS AND DOCUMENTS.
All corporate and other proceedings in connection with the
transactions contemplated by this Agreement and all documents and instruments
incident to such transactions shall be satisfactory to you and your special
counsel, and you and your special counsel shall have received all such
counterpart originals or certified or other copies of such documents as you or
they may reasonably request.
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to you that:
5.1. ORGANIZATION; POWER AND AUTHORITY.
The Company is a corporation duly organized, validly existing and in
good standing under the laws of its jurisdiction of incorporation, and is duly
qualified as a foreign corporation and is in good standing in each jurisdiction
in which such qualification is required by law, other than those jurisdictions
as to which the failure to be so qualified or in good standing could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. The Company has the corporate power and authority to own or hold
under lease the properties it purports to own or hold under lease, to transact
the business it transacts and proposes to transact, to execute and deliver this
Agreement and the Notes and to perform the provisions hereof and thereof.
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
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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).
5.3. DISCLOSURE.
The Company, through its agent, Banc of America Securities, has
delivered to you and each Other Purchaser a copy of a Private Placement
Memorandum, dated May 2003 (the "MEMORANDUM"), relating to the transactions
contemplated hereby. The Memorandum fairly describes, in all material respects,
the general nature of the business and principal properties of the Company and
its Subsidiaries. Except as disclosed in Schedule 5.3, this Agreement, the
Memorandum, the documents, certificates or other writings delivered to you by or
on behalf of the Company in connection with the transactions contemplated hereby
and the financial statements listed in Schedule 5.5, taken as a whole, do not
contain any untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein not misleading in light of the
circumstances under which they were made. Except as disclosed in the Memorandum
or as expressly described in Schedule 5.3, or in one of the documents,
certificates or other writings identified therein, or in the financial
statements listed in Schedule 5.5, since September 30, 2002, there has been no
change in the financial condition, operations, business or properties of the
Company or any Subsidiary except changes that individually or in the aggregate
could not reasonably be expected to have a Material Adverse Effect. There is no
fact known to the Company that could reasonably be expected to have a Material
Adverse Effect that has not been set forth herein or in the Memorandum or in the
other documents, certificates and other writings delivered to you by or on
behalf of the Company specifically for use in connection with the transactions
contemplated hereby. The Company has delivered to you and to each other
Purchaser true, correct and complete copies of the Merger Agreement and the
Credit Agreement.
5.4. ORGANIZATION AND OWNERSHIP OF SHARES OF SUBSIDIARIES; AFFILIATES.
(a) Schedule 5.4 contains (except as noted therein) complete and
correct lists (i) 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, (ii) of the Company's Affiliates, other than
Subsidiaries, and (iii) of the Company's directors and executive
officers.
(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
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by law, other than those jurisdictions as to which the failure to be so
qualified or in good standing could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect. Each
such Subsidiary has the corporate or other power and authority to own or
hold under lease the properties it purports to own or hold under lease
and to transact the business it transacts and proposes to transact.
(d) No Subsidiary is a party to, or otherwise subject to any legal
restriction or any agreement (other than this Agreement, the agreements
listed 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 of its Subsidiaries that owns outstanding shares of
capital stock or similar equity interests of such Subsidiary.
5.5. FINANCIAL STATEMENTS.
The Company has delivered to you and each Other Purchaser copies of
the financial statements of the Company and its Subsidiaries listed on Schedule
5.5. All of said financial statements (including in each case the related
schedules and notes) fairly present in all material respects the consolidated
financial position of the Company and its Subsidiaries as of the respective
dates specified in such Schedule and the consolidated results of their
operations and cash flows for the respective periods so specified and have been
prepared in accordance with GAAP consistently applied throughout the periods
involved except as set forth in the notes thereto (subject, in the case of any
interim financial statements, to normal year-end adjustments).
5.6. COMPLIANCE WITH LAWS, OTHER INSTRUMENTS, ETC.
The execution, delivery and performance by the Company of this
Agreement and the Notes will not (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 under, any Material agreement, or
corporate charter or by-laws, to which the Company or any Subsidiary is bound or
by which the Company or any Subsidiary or any of their respective properties may
be bound or affected, (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 or (iii) violate any provision of any statute or other rule or
regulation of any Governmental Authority applicable to the Company or any
Subsidiary.
5.7. GOVERNMENTAL AUTHORIZATIONS, ETC.
No consent, approval or authorization of, or registration, filing or
declaration with, any Governmental Authority is required in connection with the
execution, delivery or performance by the Company of this Agreement or the
Notes.
5.8. LITIGATION; OBSERVANCE OF AGREEMENTS, STATUTES AND ORDERS.
(a) 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
7
court or before any arbitrator of any kind or before or by any
Governmental Authority that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.
(b) Neither the Company nor any Subsidiary is in default under any
term of any agreement or instrument to which it is a party or by which it
is bound, or any order, judgment, decree or ruling of any court,
arbitrator or Governmental Authority or is in violation of any applicable
law, ordinance, rule or regulation (including without limitation
Environmental Laws) of any Governmental Authority, which default or
violation, individually or in the aggregate, could reasonably be expected
to have a Material Adverse Effect.
5.9. TAXES.
The Company and its Subsidiaries have filed all tax returns that are
required to have been filed in any jurisdiction, and have paid all taxes shown
to be due and payable on such returns and all other taxes and assessments levied
upon them or their properties, assets, income or franchises, to the extent such
taxes and assessments have become due and payable and before they have become
delinquent, except for any taxes and assessments (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 Company
knows of no basis for any other tax or assessment that could reasonably be
expected to have a Material Adverse Effect. The charges, accruals and reserves
on the books of the Company and its Subsidiaries in respect of Federal, state or
other taxes for all fiscal periods are adequate under GAAP. The Federal income
tax liabilities of the Company and its Subsidiaries have been determined by the
Internal Revenue Service and paid for all fiscal years up to and including the
fiscal year ended September 30, 1998.
5.10. TITLE TO PROPERTY; LEASES.
The Company and its Subsidiaries have good and sufficient title to the
properties that they own or purport to own and that individually or in the
aggregate are Material, including all such properties reflected in the most
recent audited balance sheet referred to in Section 5.5 or purported to have
been acquired by the Company or any Subsidiary after said date (except as sold
or otherwise disposed of in the ordinary course of business), in each case free
and clear of Liens prohibited by this Agreement. All leases that individually or
in the aggregate are Material are valid and subsisting and are in full force and
effect in all material respects.
5.11. LICENSES, PERMITS, ETC.
Except as disclosed in Schedule 5.11,
(a) the Company and its Subsidiaries own or possess all licenses,
permits, franchises, authorizations, patents, copyrights, service marks,
trademarks and trade names, or rights thereto, that individually or in
the aggregate are Material, without known material conflict with the
rights of others;
8
(b) to the best knowledge of the Company, no product of the Company
infringes in any material respect any license, permit, franchise,
authorization, patent, copyright, service ▇▇▇▇, trademark, trade name or
other right owned by any other Person; and
(c) to the best knowledge of the Company, there is no Material
violation by any Person of any right of the Company or any of its
Subsidiaries with respect to any patent, copyright, service ▇▇▇▇,
trademark, trade name or other right owned or used by the Company or any
of its Subsidiaries.
5.12. COMPLIANCE WITH ERISA.
(a) The Company and each ERISA Affiliate have operated and
administered each Plan in compliance with all applicable laws except for
such instances of noncompliance as have not resulted in and could not
reasonably be expected to result in a Material Adverse Effect. Neither
the Company nor any ERISA Affiliate has incurred any liability pursuant
to Title I or IV of ERISA or the penalty or excise tax provisions of the
Code relating to employee benefit plans (as defined in Section 3 of
ERISA), and no event, transaction or condition has occurred or exists
that could reasonably be expected to result in the incurrence of any such
liability by the Company or any ERISA Affiliate, or in the imposition of
any Lien on any of the rights, properties or assets of the Company or any
ERISA Affiliate, in either case pursuant to Title I or IV of ERISA or to
such penalty or excise tax provisions or to Section 401(a)(29) or 412 of
the Code, other than such liabilities or Liens as would not be
individually or in the aggregate Material.
(b) The present value of the aggregate benefit liabilities under each
of the Plans (other than Multiemployer Plans), determined as of the end
of such Plan's most recently ended plan year on the basis of the
actuarial assumptions used to determine the actuarial accrued liability
on an on-going funding basis in such Plan's most recent actuarial
valuation report, did not exceed the aggregate current value of the
assets of such Plan allocable to such benefit liabilities by a Material
amount. The term "BENEFIT LIABILITIES" has the meaning specified in
section 4001 of ERISA and the terms "CURRENT VALUE" and "PRESENT VALUE"
have the meaning specified in section 3 of ERISA.
(c) The Company and 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 have not been paid, or if contingent, that individually or in the
aggregate are Material.
(d) The expected postretirement benefit obligation (determined as of
the last day of the Company's most recently ended fiscal year in
accordance with Financial Accounting Standards Board Statement No. 106,
without regard to liabilities attributable to continuation coverage
mandated by section 4980B of the Code) of the Company and its
Subsidiaries is not Material or has been disclosed in the most recent
audited consolidated financial statements of the Company and its
Subsidiaries.
9
(e) The execution and delivery of this Agreement and the issuance of
the Notes hereunder will not involve any transaction that is subject to
the prohibitions of section 406 of ERISA or in connection with which a
tax could be imposed pursuant to section 4975(c)(1)(A)-(D) of the Code.
The representation by the Company in the first sentence of this Section
5.12(e) is made in reliance upon and subject to the accuracy of your
representation in Section 6.2 as to the sources of the funds used to
purchase the Existing Notes now held by you.
5.13. PRIVATE OFFERING BY THE COMPANY.
Neither the Company nor anyone acting on its behalf has offered the
Notes or any similar securities for sale to, or solicited any offer to buy any
of the same from, or otherwise approached or negotiated in respect thereof with,
any person other than you and the Other Purchasers, each of which has been
offered the Notes at a private exchange 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.
5.14. USE OF PROCEEDS; MARGIN REGULATIONS.
▇▇▇▇▇ applied the proceeds of the sale of the Existing Notes as set
forth in Schedule 5.14. No part of the proceeds from the sale of the Existing
Notes were used, directly or indirectly, for the purpose of buying or carrying
any margin stock within the meaning of Regulation U of the Board of Governors of
the Federal Reserve System (12 CFR 221 and 224), or for the purpose of buying or
carrying or trading in any securities under such circumstances as to involve
▇▇▇▇▇ in a violation of Regulation X of said Board (12 CFR 224) or to involve
any broker or dealer in a violation of Regulation T of said Board (12 CFR 220).
Margin stock does not constitute more than 1.0% of the value of the consolidated
assets of the Company and its Subsidiaries and the Company does not have any
present intention that margin stock will constitute more than 1.0% 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. For purposes of the foregoing, margin stock shall not include
common stock of the Company held in its treasury.
5.15. EXISTING INDEBTEDNESS; FUTURE LIENS.
(a) Except as described therein, Schedule 5.15 sets forth a complete
and correct list of all outstanding Indebtedness of the Company and its
Subsidiaries as of March 31, 2003, since which date there has been no
Material change in the amounts, interest rates, sinking funds,
installment payments or maturities of the Indebtedness of the Company or
its Subsidiaries. Neither the Company nor any Subsidiary is in default
and no waiver of default is currently in effect, in the payment of any
principal or interest on any Indebtedness of the Company or such
Subsidiary that is outstanding in an aggregate principal amount in excess
of $5,000,000 and no event or condition exists with respect to any
Indebtedness of the Company or any Subsidiary that is outstanding in an
aggregate principal amount in excess of $5,000,000 and 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
10
become due and payable before its stated maturity or before its regularly
scheduled dates of payment.
(b) Except as disclosed in Schedule 5.15, neither the Company nor any
Subsidiary has agreed or consented to cause or permit in the future (upon
the happening of a contingency or otherwise) any of its property, whether
now owned or hereafter acquired, to be subject to a Lien not permitted by
Section 10.2.
5.16. FOREIGN ASSETS CONTROL REGULATIONS, ETC.
Neither the issuance of the Notes by the Company hereunder nor the use
of the proceeds of Existing Notes by ▇▇▇▇▇ violated or will violate the Trading
with the Enemy Act, as amended, or any of the foreign assets control regulations
of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as
amended) or any enabling legislation or executive order relating thereto.
5.17. STATUS UNDER CERTAIN STATUTES.
Neither the Company nor any Subsidiary is subject to regulation under
the Investment Company Act of 1940, as amended, the Public Utility Holding
Company Act of 1935, as amended, the Interstate Commerce Act, as amended by the
ICC Termination Act, as amended, or the Federal Power Act, as amended.
5.18. ENVIRONMENTAL MATTERS.
Neither the Company nor any Subsidiary has knowledge of any liability
or has received any notice of any liability, and no proceeding has been
instituted asserting any liability against the Company or any of its
Subsidiaries or any of their respective real properties now owned, leased or
operated by any of them or other assets nor, to the knowledge of the Company or
any Subsidiary, has any such proceeding been instituted against any of their
respective real properties formerly owned, for damage to the environment or
violation of any Environmental Laws, except, in each case, such as could not
reasonably be expected to result in a Material Adverse Effect. Except as
otherwise disclosed to you in writing,
(a) neither the Company nor any Subsidiary has knowledge of any facts
that would give rise to any liability for violation of Environmental Laws
or damage to the environment emanating from, occurring on or in any way
related to real properties now or, to the Company's or such Subsidiary's
knowledge, formerly owned, leased or operated by any of them or to other
assets or their use, except, in each case, such as could not reasonably
be expected to result in a Material Adverse Effect;
(b) neither the Company nor any of its Subsidiaries has stored any
Hazardous Materials on real properties now or formerly owned, leased or
operated by any of them and has not disposed of any Hazardous Materials
in a manner contrary to any Environmental Laws in each case in any manner
that could reasonably be expected to result in a Material Adverse Effect;
and
11
(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.
Each of the representations in this Section 5 is made after giving effect to the
consummation of the Merger and the discharge of the obligations of ▇▇▇▇▇ under
the Existing ▇▇▇▇▇ Credit Agreement.
6. REPRESENTATIONS OF THE PURCHASERS.
6.1. PURCHASE FOR INVESTMENT.
You represent that you are acquiring the Notes to be issued to you for
your own account or for one or more separate accounts maintained by you or for
the account of one or more pension or trust funds and not with a view to the
distribution thereof, PROVIDED that the disposition of your or their property
shall at all times be within your or their control. You understand that the
Notes to be issued to you have not been registered under the Securities Act and
may be resold only if registered pursuant to the provisions of the Securities
Act or if an exemption from registration is available, except under
circumstances where neither such registration nor such an exemption is required
by law, and that the Company is not required to register the Notes.
6.2. SOURCE OF FUNDS.
You represent that at least one of the following statements is an
accurate representation as to each source of funds (a "SOURCE") used by you to
purchase the Existing Notes now held by you:
(a) if you are an insurance company, the Source did not include
assets allocated to any separate account maintained by you in which any
employee benefit plan (or its related trust) had any interest, other than
a separate account that was maintained solely in connection with your
fixed contractual obligations under which the amounts payable, or
credited, to such plan and to any participant or beneficiary of such plan
(including any annuitant) are not affected in any manner by the
investment performance of the separate account; or
(b) the Source was either (i) an insurance company pooled separate
account, within the meaning of Prohibited Transaction Exemption ("PTE")
▇▇-▇ (▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇), ▇▇ (▇▇) a bank collective investment
fund, within the meaning of the PTE 91-38 (issued July 12, 1991) and,
except as you have disclosed to the ▇▇▇▇▇ in writing pursuant to Section
6.2(b) of the Existing Note Agreement, 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 constituted 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
12
benefit plan's assets that were 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, exceeded 20% of the total
client assets managed by such QPAM, the conditions of Part 1(c) and (g)
of the QPAM Exemption were 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) owned a 5% or more
interest in the Company and (i) the identity of such QPAM and (ii) the
names of all employee benefit plans whose assets are included in such
investment fund have been disclosed to ▇▇▇▇▇ in writing pursuant to
Section 6.2(c) of the Existing Note Agreement; or
(d) the Source was a governmental plan; or
(e) the Source was one or more employee benefit plans, or a separate
account or trust fund comprised of one or more employee benefit plans,
each of which was identified to ▇▇▇▇▇ in writing pursuant to this Section
6.2(e) of the Existing Note Agreement; or
(f) the Source did not include assets of any employee benefit plan,
other than a plan exempt from the coverage of ERISA; or
(g) the Source was an insurance company general account" as such term
is defined in the Department of Labor Prohibited Transaction Class
Exemption 95-60 (issued July 12, 1995) ("PTE 95-60") and there was no
"employee benefit plan" with respect to which the aggregate amount of
such general account's reserves and liabilities for the contracts held by
or on behalf of such employee benefit plan and all other employee benefit
plans maintained by the same employer (and affiliates thereof as defined
in Section V(a)(1) of PTE 95-60) or by the same employee organization (in
each case determined in accordance with the provisions of PTE 95-60)
exceeded 10% of the total reserves and liabilities of such general
account (as determined under PTE 95-60) (exclusive of separate account
liabilities) plus surplus as set forth in the National Association of
Insurance Commissioners Annual Statement filed with the state of domicile
of such Purchaser.
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.
7. INFORMATION AS TO COMPANY.
7.1. FINANCIAL AND BUSINESS INFORMATION
The Company shall deliver to each holder of Notes that is an
Institutional Investor:
(a) QUARTERLY STATEMENTS -- within 60 days after the end of each
quarterly fiscal period in each fiscal year of the Company (other than
the last quarterly fiscal period of each such fiscal year), duplicate
copies of,
13
(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
stockholders' equity and cash flows of the Company and its
Subsidiaries, for such quarter and (in the case of the second and
third quarters) for the portion of the fiscal year ending with such
quarter,
setting forth in each case in comparative form the figures for the
corresponding periods in the previous fiscal year, all in reasonable
detail, prepared in accordance with GAAP applicable to quarterly
financial statements generally, and certified by a Senior Financial
Officer as fairly presenting, in all material respects, the financial
position of the companies being reported on 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 l0-Q prepared
in compliance with the requirements therefor and filed with the
Securities and Exchange Commission shall be deemed to satisfy the
requirements of this Section 7.1(a);
(b) ANNUAL STATEMENTS -- within 120 days after the end of each fiscal
year of the Company, duplicate copies of,
(i) 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
stockholders' equity and cash flows of the Company and its
Subsidiaries, for such year,
setting forth in each case in comparative form the figures for the
previous fiscal year, all in reasonable detail, prepared in accordance
with GAAP, and accompanied by 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 financial position of the companies being reported upon 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, together with such accountant's opinion, 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 (without exhibits except as expressly requested
14
by such holder), and each prospectus and all amendments thereto filed by
the Company or any Subsidiary with the Securities and Exchange Commission
and of all press releases and other statements made available generally
by the Company or any Subsidiary to the public concerning developments
that are Material;
(d) NOTICE OF DEFAULT OR EVENT OF DEFAULT -- promptly, and in any
event within five days after a Responsible Officer obtains actual
knowledge of the existence of any Default or Event of Default or that any
Person has given any notice or taken any action with respect to a claimed
default hereunder or that any Person has given any notice or taken any
action with respect to a claimed default of the type referred to in
Section 11(f), a written notice specifying the nature and period of
existence thereof and what action the Company is taking or proposes to
take with respect thereto;
(e) ERISA MATTERS -- promptly, and in any event within five days
after a Responsible Officer becoming aware of any of the following, a
written notice setting forth the nature thereof and the action, if any,
that the Company or an ERISA Affiliate proposes to take with respect
thereto:
(i) with respect to any Plan, any reportable event, as
defined in section 4043(b) 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,
could reasonably be expected to have a Material Adverse Effect;
(f) NOTICES FROM GOVERNMENTAL AUTHORITY -- promptly, and in any event
within 30 days of receipt thereof, copies of any notice to the Company or
any Subsidiary from any Federal or state Governmental Authority relating
to any order, ruling, statute or other law or regulation that could
reasonably be expected to have a Material Adverse Effect; and
(g) REQUESTED INFORMATION -- with reasonable promptness, such other
data and information relating to the business, operations, affairs,
financial condition, assets or properties of the Company or any of its
Subsidiaries or relating to the ability of the
15
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.
7.2. OFFICER'S CERTIFICATE.
Each set of financial statements delivered to a holder of Notes
pursuant to Section 7.1(a) or (b) 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 through Section 10.5,
inclusive, during the quarterly or annual period covered by the
statements then being furnished (including with respect to each such
Section, where applicable, the calculations of the maximum or minimum
amount, ratio or percentage, as the case may be, permissible under the
terms of such Sections, and the calculation of the amount, ratio or
percentage then in existence); and
(b) EVENT OF DEFAULT -- a statement that such officer has reviewed
the relevant terms hereof and has made, or caused to be made, under his
or her supervision, a review of the transactions and conditions of the
Company and its Subsidiaries from the beginning of the quarterly or
annual period covered by the statements then being furnished to the date
of the certificate and that such review 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 any such event or condition resulting from the
failure of the Company or any Subsidiary to comply with any Environmental
Law), specifying the nature and period of existence thereof and what
action the Company shall have taken or proposes to take with respect
thereto.
7.3. INSPECTION.
The Company will 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 and upon reasonable prior notice to the Company,
to visit the principal executive office of the Company, to discuss the
affairs, finances and accounts of the Company and its Subsidiaries with
the Company's officers, and (with the consent of the Company, which
consent will not be unreasonably withheld) its independent public
accountants, and (with the consent of the Company, which consent will not
be unreasonably withheld) to visit the other offices and properties of
the Company and each
16
Subsidiary, all at such reasonable times and as often as may be
reasonably requested in writing.
8. PREPAYMENT OF THE NOTES.
8.1. REQUIRED PREPAYMENTS.
The Series 2003-B Notes are subject to required prepayment on November
14, 2003 and on each November 14 thereafter to and including November 14, 2006,
on which dates the Company will prepay $7,833,333 principal amount (or such
lesser principal amount as shall then be outstanding) of the Series 2003-B
Notes, at par, without payment of the Make-Whole Amount or any premium. The
Series 2003-A Notes and the Series 2003-C Notes are not subject to required
prepayment.
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 $2,000,000 in the aggregate in the case of a partial prepayment, at
100% of the principal amount so prepaid, plus the Make-Whole Amount determined
for the prepayment date with respect to such principal amount. The Company will
give each holder of the 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 8.3), and the interest to be paid on the prepayment date
with respect to such principal amount being prepaid, and shall be accompanied by
a certificate of a Senior Financial Officer as to the estimated Make-Whole
Amount due in connection with such prepayment (calculated as if the date of such
notice were the date of the prepayment), setting forth the details of such
computation. Two Business Days prior to such prepayment, the Company shall
deliver to each holder of Notes a certificate of a Senior Financial Officer
specifying the calculation of such Make-Whole Amount as of the specified
prepayment date.
8.3. ALLOCATION OF PARTIAL PREPAYMENTS.
In the case of each partial prepayment of the Notes, the principal
amount of the Notes to be prepaid shall be allocated among all of the Notes at
the time outstanding in proportion, as nearly as practicable, to the respective
unpaid principal amounts thereof not theretofore called for prepayment. Each
such partial prepayment pursuant to Section 8.2 shall be applied first to the
payment due on such Notes at final maturity and thereafter to any required
prepayments on such Notes, in inverse order of maturity.
8.4. MATURITY; SURRENDER, ETC.
In the case of each prepayment of Notes pursuant to this Section 8,
the principal amount of each Note to be prepaid shall mature and become due and
payable on the date fixed for such prepayment, together with interest on such
principal amount accrued to such date and the applicable Make-Whole Amount, if
any. From and after such date, unless the Company shall fail
17
to pay such principal amount when so due and payable, together with the interest
and Make-Whole Amount, if any, as aforesaid, interest on such principal amount
shall cease to accrue. Any Note paid or prepaid in full shall be surrendered to
the Company and canceled and shall not be reissued, and no Note shall be issued
in lieu of any prepaid principal amount of any Note.
8.5. PURCHASE OF THE 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 upon the payment or prepayment of the Notes in
accordance with the terms of this Agreement and the Notes. The Company will
promptly cancel all Notes acquired by it or any Affiliate pursuant to any
payment, prepayment or purchase of the Notes pursuant to any provision of this
Agreement and no Notes may be issued in substitution or exchange for any such
Notes.
8.6. MAKE-WHOLE AMOUNT.
The term "MAKE-WHOLE AMOUNT" means, with respect to any Note, an
amount equal to the excess, if any, of the Discounted Value of the Remaining
Scheduled Payments with respect to the Called Principal of such Note over the
amount of such Called Principal, PROVIDED that the Make-Whole Amount may in no
event be less than zero. For the purposes of determining the Make-Whole Amount,
the following terms have the following meanings:
"CALLED PRINCIPAL" means, with respect to any Note, the principal of
such Note that is to be prepaid pursuant to Section 8.2 or has become or
is declared to be immediately due and payable pursuant to Section 12.1,
as the context requires.
"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, .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 the "PX1 Screen" on the Bloomberg Financial
Market Service (or such other display as may replace the PX1 Screen on
Bloomberg Financial Market Service) for actively traded U.S. Treasury
securities having a maturity equal to the Remaining Average Life of such
Called Principal as of such Settlement Date, or (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
18
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 maturity closest to
and greater than the Remaining Average Life and (2) the actively traded
U.S. Treasury security with the maturity closest to and less than the
Remaining Average Life.
"REMAINING AVERAGE LIFE" means, with respect to any Called Principal,
the number of years (calculated to the nearest one-twelfth year) obtained
by dividing (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 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 in question, then the amount of the next succeeding scheduled
interest payment will be reduced by the amount of interest accrued to
such Settlement Date and required to be paid on such Settlement Date
pursuant to Section 8.2 or 12.1.
"SETTLEMENT DATE" means, with respect to the Called Principal of any
Note, the date on which such Called Principal is to be prepaid pursuant
to Section 8.2 or has become or is declared to be immediately due and
payable pursuant to Section 12.1, as the context requires.
9. AFFIRMATIVE COVENANTS.
The Company covenants that so long as any of the Notes are
outstanding:
9.1. COMPLIANCE WITH LAW.
The Company will, and will cause each Subsidiary to, comply with all
laws, ordinances or governmental rules or regulations to which each of them is
subject, including 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 could
not, individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
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9.2. INSURANCE.
The Company will, and will cause each Subsidiary to, maintain, with
financially sound and reputable insurers, insurance with respect to their
respective properties and businesses against such casualties and contingencies,
of such types, on such terms and in such amounts (including deductibles,
co-insurance and self-insurance, if adequate reserves are maintained with
respect thereto) as is customary in the case of entities of established
reputations engaged in the same or a similar business and similarly situated.
9.3. MAINTENANCE OF PROPERTIES.
The Company will and will cause each Subsidiary to maintain and keep,
or cause to be maintained and kept, their respective properties in good repair,
working order and condition (other than ordinary wear and tear), so that the
business carried on in connection therewith may be properly conducted at all
times, provided that this Section shall not prevent the Company or any
Subsidiary from discontinuing the operation and the maintenance of any of its
properties if such discontinuance is desirable in the conduct of its business
and the Company has concluded that such discontinuance could not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
9.4. PAYMENT OF TAXES AND CLAIMS.
The Company will, and will cause each Subsidiary to, file all tax
returns required to be filed in any jurisdiction and to pay and discharge all
taxes shown to be due and payable on such returns and all other taxes,
assessments, governmental charges, or levies imposed on them or any of their
properties, assets, income or franchises, to the extent such taxes and
assessments have become due and payable and before they have become delinquent
and all claims for which sums have become due and payable that have or might
become a Lien on properties or assets of the Company or any Subsidiary, PROVIDED
that neither the Company nor any Subsidiary need pay any such tax or assessment
or claims if (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 could not reasonably be expected to have a Material Adverse
Effect.
9.5. CORPORATE EXISTENCE, ETC.
Subject to Section 10.4, the Company will at all times preserve and
keep in full force and effect its corporate existence. Subject to Sections 10.3
and 10.4, the Company will at all times preserve and keep in full force and
effect the corporate existence of each Subsidiary (unless merged into the
Company or a Subsidiary) and all rights and franchises of the Company and its
Subsidiaries unless, in the good faith judgment of the Company, the termination
of or failure to preserve and keep in full force and effect such corporate
existence, right or franchise could not, individually or in the aggregate, have
a Material Adverse Effect.
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9.6. SUBSIDIARY GUARANTY AGREEMENTS.
The Company covenants that if at any time any Subsidiary shall be
subject to a Guaranty with respect to the Credit Agreement or any Domestic
Subsidiary shall become a borrower under the Credit Agreement, then the Company
will, at such time, cause (a) such Subsidiary to execute and deliver to the
holders of the Notes a guarantee agreement, in form and substance satisfactory
to the Required Holder(s) (a "GUARANTEE AGREEMENT"), under which such Subsidiary
guaranties the due and punctual payment of the obligations of the Company under
this Agreement and the Notes, together with resolutions of the board of
directors of such Subsidiary authorizing the execution, delivery and performance
of such Guarantee Agreement by such Subsidiary, certified by the Secretary or
Assistant Secretary of such Subsidiary, certified copies of the articles of
incorporation or by-laws of such Subsidiary, and an opinion of counsel, in form
and substance satisfactory to the Required Holder(s), as to such matters with
respect thereto as the Required Holder(s) may reasonably request, and (b) the
Bank Lenders to execute and deliver to the holders of the Notes an intercreditor
agreement between the Bank Lenders and the holders of the Notes relating to the
pari passu sharing of any payments received from any such Subsidiary; provided,
however, that the Company shall not be required to cause the documents described
in clauses (a) and (b) of this Section 9.6 to be delivered so long as both (i)
the only Subsidiary subject to a Guaranty with respect to the Credit Agreement
is ▇▇▇▇▇▇ Amplifier and no Domestic Subsidiary shall be a borrower under the
Credit Agreement, and (2) Consolidated Tangible Assets of ▇▇▇▇▇▇ Amplifier is
less than $100,000,000. Nothing in this Section 9.6 shall be deemed a consent to
Indebtedness not permitted under Section 10.1 of this Agreement.
10. NEGATIVE COVENANTS.
The Company covenants that so long as any of the Notes are
outstanding:
10.1. CONSOLIDATED INDEBTEDNESS; INDEBTEDNESS OF SUBSIDIARIES.
The Company will not permit:
(a) Its Consolidated Net Worth to be at any time less than the (x)
sum of (i) $964,284,000, PLUS (ii) 25% of its Consolidated Net Income for
each Fiscal Quarter commencing with the Fiscal Quarter ending September
30, 2003 (calculated without deduction for any net losses), PLUS (iii)
50% of the proceeds of any Equity Issuance occurring after the ▇▇▇▇▇
Closing Date;
(b) Its Consolidated Total Debt to EBITDA Ratio as of the end of any
Fiscal Quarter to be greater than 3.0 to 1.0; or
(c) Any Subsidiary to incur any Indebtedness if, after giving effect
thereto and to the application of the proceeds therefrom, Priority Debt
outstanding would exceed 20% of Consolidated Total Capitalization.
10.2. LIENS.
The Company will not, and will not permit any Subsidiary to, permit to
exist, create, assume or incur, directly or indirectly, any Lien on its
properties or assets, whether now
21
owned or hereafter acquired (unless, concurrently with the incurrence,
assumption or creation of such Lien, the Company makes, or causes to be made,
effective provision whereby the Notes are equally and ratably secured by a Lien
on the same property or assets), except:
(a) Liens existing on property or assets of the Company or any
Subsidiary as of the date of this Agreement that are described in
Schedule 10.2;
(b) Liens for taxes, assessments or governmental charges not then due
and delinquent or the nonpayment of which is permitted by Section 9.4;
(c) encumbrances in the nature of leases, subleases, zoning
restrictions, easements, rights of way and other rights and restrictions
of record on the use of real property and defects in title arising or
incurred in the ordinary course of business, which, individually and in
the aggregate, do not materially impair the use or value of the property
or assets subject thereto;
(d) Liens incidental to the conduct of business or the ownership of
properties and assets (including landlords', lessors', carriers',
warehousemen's, mechanics', materialmen's and other similar liens) and
Liens to secure the performance of bids, tenders, leases or trade
contracts, or to secure statutory obligations (including obligations
under workers compensation, unemployment insurance and other social
security legislation), surety or appeal bonds or other Liens of like
general nature incurred in the ordinary course of business and not in
connection with the borrowing of money;
(e) any attachment or judgment Lien, unless the judgment it secures
has not, within 60 days after the entry thereof, been discharged or
execution thereof stayed pending appeal, or has not been discharged
within 60 days after the expiration of any such stay;
(f) Liens securing Indebtedness of a Subsidiary to the Company or to
another Subsidiary and Liens securing Indebtedness of the Company to a
Subsidiary;
(g) Liens (i) existing on property at the time of its acquisition by
the Company or a Subsidiary and not created in contemplation thereof,
whether or not the Indebtedness secured by such Lien is assumed by the
Company or a Subsidiary; or (ii) on property created contemporaneously
with its acquisition or within 180 days of the acquisition or completion
of construction thereof to secure or provide for all or a portion of the
purchase price or cost of construction of such property after the date of
Closing; or (iii) existing on property of a Person at the time such
Person is merged or consolidated with, or becomes a Subsidiary of, or
substantially all of its assets are acquired by, the Company or a
Subsidiary and not created in contemplation thereof; PROVIDED that in the
case of clauses (i), (ii) and (iii) such Liens do not extend to
additional property of the Company or any Subsidiary and that the
aggregate principal amount of Indebtedness secured by each such Lien does
not exceed the cost of acquisition or construction of the property
subject thereto;
(h) Liens resulting from extensions, renewals or replacements of
Liens permitted by paragraphs (a), (f) and (g), PROVIDED that (i) there
is no increase in the
22
principal amount or decrease in maturity of the Indebtedness secured
thereby at the time of such extension, renewal or replacement, (ii) any
new Lien attaches only to the same property theretofore subject to such
earlier Lien and (iii) immediately after such extension, renewal or
replacement no Default or Event of Default would exist; and
(i) Additional Liens securing Indebtedness not otherwise permitted by
paragraphs (a) through (h) above, provided that, at the time of creation,
assumption or incurrence thereof and immediately after giving effect
thereto and to the application of the proceeds therefrom, Priority Debt
outstanding does not exceed 20% of Consolidated Total Capitalization.
Notwithstanding the foregoing, no Lien securing any of the Company's obligations
under the Credit Agreement shall be permitted under any of clauses (a) through
(i), above.
10.3. SALE OF ASSETS.
Except as permitted by Section 10.4, the Company will not, and will
not permit any Subsidiary to, sell, lease, transfer or otherwise dispose of,
including by way of merger (collectively a "DISPOSITION"), any assets, including
capital stock of Subsidiaries, in one or more transactions, to any Person, other
than (a) Dispositions in the ordinary course of business, (b) Dispositions by
the Company to a Subsidiary or by a Subsidiary to the Company or another
Subsidiary or (c) other Dispositions not otherwise permitted by this Section
10.3, provided that the aggregate net book value of all assets so disposed of in
any fiscal year pursuant to this Section 10.3(c) does not exceed 15% of
Consolidated Total Assets of the Company as of the end of the immediately
preceding fiscal year. Notwithstanding the foregoing, the Company may, or may
permit any Subsidiary to, make a Disposition and the assets subject to such
Disposition shall not be subject to or included in the foregoing limitation and
computation contained in clause (c) of the preceding sentence to the extent that
(x) such assets are leased back by the Company or any Subsidiary, as lessee,
within 180 days of the Disposition thereof, or (y) the net proceeds from such
Disposition are within one year of such Disposition (A) reinvested in productive
assets by the Company or a Subsidiary consistent with Section 10.7 (and in no
event in assets relating to a discontinued operation at the time of
reinvestment) or (B) applied to the payment or prepayment of any outstanding
Indebtedness of the Company or any Subsidiary that is not subordinated to the
Notes. Any prepayment of Notes pursuant to this Section 10.3 shall be in
accordance with Sections 8.2 and 8.3, without regard to the minimum prepayment
requirements of Section 8.2.
10.4. MERGERS, CONSOLIDATIONS, ETC.
The Company will not, and will not permit any Subsidiary to,
consolidate with or merge with any other Person or convey, transfer, sell or
lease all or substantially all of its assets in a single transaction or series
of transactions to any Person except that:
(a) The Company may consolidate or merge with any other Person or
convey, transfer, sell or lease all or substantially all of its assets in
a single transaction or series of transactions to any Person, provided
that:
(i) the successor formed by such consolidation or the
survivor of such merger or the Person that acquires by conveyance,
transfer, sale or lease of all or
23
substantially all of the assets of the Company as an entirety, as the
case may be, shall be a solvent corporation organized and existing
under the laws of the United States, any State thereof (including the
District of Columbia) or Canada or any province thereof, and, if the
Company is not such corporation, such corporation (x) 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 (y) shall have caused to
be delivered to each holder of any Notes an opinion of 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;
(ii) the Subsidiaries of the successor formed by such
consolidation or the survivor of such merger or the Person that
acquires by conveyance, transfer, sale or lease all or substantially
all of the assets of the Company as an entirety, as the case may be,
could incur immediately thereafter $1.00 of additional Indebtedness
without violating Section 10.1;
(iii) immediately before and after giving effect to such
transaction, no Default or Event of Default shall exist (and, for the
purpose of Sections 10.1(a) and (b), such transaction shall be deemed
to have occurred as of the last day of the Fiscal Quarter most
recently ended); and
(b) Any Subsidiary may (x) merge into the Company (provided that the
Company is the surviving corporation) or another Subsidiary or (y) sell,
transfer or lease all or any part of its assets to the Company or another
Subsidiary, or (z) merge or consolidate with, or sell, transfer or lease
all or substantially all of its assets to, any Person in a transaction
that is permitted by Section 10.3 or, as a result of which, such Person
becomes an Subsidiary; PROVIDED in each instance set forth in clauses (x)
through (z) that, immediately before and after giving effect thereto,
there shall exist no Default or Event of Default (and, for the purpose of
Sections 10.1(a) and (b), such transaction shall be deemed to have
occurred as of the last day of the Fiscal Quarter most recently ended);
No such conveyance, transfer, sale or lease of all or substantially all of the
assets of the Company shall have the effect of releasing the Company or any
successor corporation that shall theretofore have become such in the manner
prescribed in this Section 10.4 from its liability under this Agreement or the
Notes.
10.5. DISPOSITION OF STOCK OF SUBSIDIARIES.
The Company (i) will not permit any Subsidiary to issue its capital
stock, or any warrants, rights or options to purchase, or securities convertible
into or exchangeable for, such capital stock, to any Person other than the
Company or another Subsidiary, and (ii) will not, and will not permit any
Subsidiary to, sell, transfer or otherwise dispose of any shares of capital
stock of a Subsidiary if such sale would be prohibited by Section 10.3. If a
Subsidiary at any time ceases to be such as a result of a sale or issuance of
its capital stock, any Liens on property of the Company or any other Subsidiary
securing Indebtedness owed to such Subsidiary, which is not
24
contemporaneously repaid, together with such Indebtedness, shall be deemed to
have been incurred by the Company or such other Subsidiary, as the case may be,
at the time such Subsidiary ceases to be a Subsidiary.
10.6. [INTENTIONALLY OMITTED]
10.7. NATURE OF BUSINESS.
The Company will not, and will not permit any Subsidiary to, engage in
any business if; as a result, the general nature of the business in which the
Company and its Subsidiaries, taken as a whole, would then be engaged would be
substantially changed from the general nature of the business in which the
Company and its Subsidiaries, taken as a whole, are engaged on the Closing Date.
As of the date of this Agreement, the Company and its Subsidiaries manufacture
and sell wireless telecommunications equipment, products and services as
described in the Memorandum.
10.8. 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 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 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.
11. EVENTS OF DEFAULT.
An "EVENT OF DEFAULT" shall exist if any of the following conditions
or events shall occur and be continuing:
(a) the Company defaults in the payment of any principal or
Make-Whole Amount, if any, on any Note when the same becomes due and
payable, whether at maturity or at a date fixed for prepayment or by
declaration or otherwise; or
(b) the Company defaults in the payment of any interest on any Note
for more than five Business Days after the same becomes due and payable;
or
(c) the Company defaults in the performance of or compliance with any
term contained in Section 7.1(d) or Sections 10.1 through 10.8; or
(d) the Company defaults in the performance of or compliance with any
term contained herein (other than those referred to in paragraphs (a),
(b) and (c) of this Section 11) and such default is not remedied within
30 days after the earlier of (i) a Responsible Officer obtaining actual
knowledge of such default and (ii) the Company receiving written notice
of such default from any holder of a Note; or
(e) any representation or warranty made in writing by or on behalf of
the Company or by any officer of the Company in this Agreement or in any
writing furnished
25
in connection with the transactions contemplated hereby proves to have
been false or incorrect in any material respect on the date as of which
made; or
(f) (i) the Company or any Subsidiary is in default (as principal or
as guarantor or other surety) in the payment of any principal of or
premium or make-whole amount or interest on any Indebtedness that is
outstanding in an aggregate principal amount in excess of 5% of Adjusted
Consolidated Net Worth (as of the end of the most recently completed
fiscal period of the Company) beyond any period of grace provided with
respect thereto or (ii) the Company or any Subsidiary is in default in
the performance of or compliance with any term of any evidence of any
Indebtedness that is outstanding in an aggregate principal amount in
excess of 5% of Adjusted Consolidated Net Worth (as of the end of the
most recently completed fiscal period of the Company) 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, due and payable before its
stated maturity or before its regularly scheduled dates of payment; or
(g) the Company or any Material 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
Material Subsidiary, 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 Material Subsidiary, or any such
petition shall be filed against the Company or any Material Subsidiary
and such petition shall not be dismissed within 60 days; or
(i) a final judgment or judgments for the payment of money
aggregating in excess of 5% of Adjusted Consolidated Net Worth (as of the
end of the most recently completed fiscal period of the Company) are
rendered against one or more of the Company and its Material
Subsidiaries, 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) 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,
26
(ii) a notice of intent to terminate any Plan shall have been or is
reasonably expected to be filed with the PBGC or the PBGC shall have
instituted proceedings under ERISA section 4042 to terminate or appoint a
trustee to administer any Plan or the PBGC shall have notified the
Company or any ERISA Affiliate that a Plan may become a subject of any
such proceedings, (iii) the aggregate "amount of unfunded benefit
liabilities" (within the meaning of section 4001(a)(18) of ERISA) under
all Plans, determined in accordance with Title IV of ERISA, shall exceed
5% of Adjusted Consolidated Net Worth (as of the end of the most recently
completed fiscal period of the Company), (iv) the Company or any ERISA
Affiliate shall have incurred or is reasonably expected to incur any
liability pursuant to Title I or IV of ERISA or the penalty or excise tax
provisions of the Code relating to employee benefit plans, (v) the
Company or any ERISA Affiliate withdraws from any Multiemployer Plan, or
(vi) the Company or any Subsidiary establishes or amends any employee
welfare benefit plan that provides post-employment welfare benefits in a
manner that would increase the liability of the Company or any Subsidiary
thereunder; and any such event or events described in clauses (i) through
(vi) above, either individually or together with any other such event or
events, could reasonably be expected to have a Material Adverse Effect.
As used in Section 11(j), the terms "EMPLOYEE BENEFIT PLAN" and "EMPLOYEE
WELFARE BENEFIT PLAN" shall have the respective meanings assigned to such terms
in Section 3 of ERISA.
12. REMEDIES ON DEFAULT, ETC.
12.1. ACCELERATION.
(a) If an Event of Default with respect to the Company described in
paragraph (g) or (h) of Section 11 (other than an Event of Default
described in clause (i) of paragraph (g) or described in clause (vi) of
paragraph (g) by virtue of the fact that such clause encompasses clause
(i) of paragraph (g)) has occurred, all the Notes then outstanding shall
automatically become immediately due and payable.
(b) If any other Event of Default has occurred and is continuing, any
holder or holders of more than 33% in principal amount of the Notes at
the time outstanding may at any time at its or their option, by notice or
notices to the Company, declare all the Notes then outstanding to be
immediately due and payable.
(c) If any Event of Default described in paragraph (a) or (b) of
Section 11 has occurred and is continuing, any holder or holders of Notes
at the time outstanding affected by such Event of Default may at any
time, at its or their option, by notice or notices to the Company,
declare all the Notes held by it or them to be immediately due and
payable.
Upon any Notes becoming due and payable under this Section 12.1,
whether automatically or by declaration, such Notes will forthwith mature and
the entire unpaid principal amount of such Notes, plus (x) all accrued and
unpaid interest thereon and (y) the Make-Whole Amount determined in respect of
such principal amount (to the full extent permitted by applicable law), shall
all be immediately due and payable, in each and every case without presentment,
demand, protest or further notice, all of which are hereby waived. The Company
acknowledges,
27
and the parties hereto agree, that each holder of a Note has the right to
maintain its investment in the Notes free from repayment by the Company (except
as herein specifically provided for) and that the provision for payment of a
Make-Whole Amount by the Company in the event that the Notes are prepaid or are
accelerated as a result of an Event of Default, is intended to provide
compensation for the deprivation of such right under such circumstances.
12.2. OTHER REMEDIES.
If any Default or Event of Default has occurred and is continuing, and
irrespective of whether any Notes have become or have been declared immediately
due and payable under Section 12.1, the holder of any Note at the time
outstanding may proceed to protect and enforce the rights of such holder by an
action at law, suit in equity or other appropriate proceeding, whether for the
specific performance of any agreement contained herein or in any Note, or for an
injunction against a violation of any of the terms hereof or thereof; or in aid
of the exercise of any power granted hereby or thereby or by law or otherwise.
12.3. RESCISSION.
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 68%
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.
28
12.4. NO WAIVERS OR ELECTION OF REMEDIES, EXPENSES, ETC.
No course of dealing and no delay on the part of any holder of any
Note in exercising any right, power or remedy shall operate as a waiver thereof
or otherwise prejudice such holder's rights, powers or remedies. No right, power
or remedy conferred by this Agreement or by any Note upon any holder thereof
shall be exclusive of any other right, power or remedy referred to herein or
therein or now or hereafter available at law, in equity, by statute or
otherwise. Without limiting the obligations of the Company under Section 15, the
Company will pay to the holder of each Note on demand such further amount as
shall be sufficient to cover all costs and expenses of such holder incurred in
any enforcement or collection under this Section 12, including, without
limitation, reasonable attorneys' fees, expenses and disbursements.
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.
13.1. REGISTRATION OF NOTES.
The Company shall keep at its principal executive office a register
for the registration and registration of transfers of Notes. The name and
address of each holder of one or more Notes, each transfer thereof and the name
and address of each transferee of one or more Notes shall be registered in such
register. Prior to due presentment for registration of transfer, the Person in
whose name any Note shall be registered shall be deemed and treated as the owner
and holder thereof for all purposes hereof; and the Company shall not be
affected by any notice or knowledge to the contrary. The Company shall give to
any holder of a Note that is an Institutional Investor, promptly upon request
therefor, a complete and correct copy of the names and addresses of all
registered holders of Notes.
13.2. TRANSFER AND EXCHANGE OF NOTES.
Upon surrender of any Note at the principal executive office of the
Company for registration of transfer or exchange (and in the case of a surrender
for registration of transfer, duly endorsed or accompanied by a written
instrument of transfer duly executed by the registered holder of such Note or
his attorney duly authorized in writing and accompanied by the address for
notices of each transferee of such Note or part thereof), the Company shall
execute and deliver, at the Company's expense (except as provided below), one or
more new Notes (as requested by the holder thereof) of the same series 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
the Note established for such series. 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 $500,000,
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
$500,000. Any transferee, by its acceptance of a Note registered in its name (or
the name of its nominee), shall be deemed to have made the representation set
forth in Section 6.2.
29
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 Institutional
Investor holder of a Note with a minimum net worth of at least
$50,000,000, 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 of the same series, dated and bearing interest from the date to which
interest shall have been paid on such lost, stolen, destroyed or mutilated Note
or dated the date of such lost, stolen, destroyed or mutilated Note if no
interest shall have been paid thereon.
14. PAYMENTS ON THE NOTES.
14.1. PLACE OF PAYMENT.
Subject to Section 14.2, payments of principal, Make-Whole Amount, if
any, and interest becoming due and payable on the Notes shall be made in
Chicago,
Illinois at the principal office of Bank of America National Trust &
Savings Association in such jurisdiction. The Company may at any time, by notice
to each holder of a Note, change the place of payment of the Notes so long as
such place of payment shall be either the principal office of the Company in
such jurisdiction or the principal office of a bank or trust company in such
jurisdiction.
14.2. HOME OFFICE PAYMENT.
So long as you or your nominee shall be the holder of any Note, and
notwithstanding anything contained in Section 14.1 or in such Note to the
contrary, the Company will pay all sums becoming due on such Note for principal,
Make-Whole Amount, if any, and interest by the method and at the address
specified for such purpose below your name in Schedule A, or by such other
method or at such other address as you shall have from time to time specified to
the Company in writing for such purpose, without the presentation or surrender
of such Note or the making of any notation thereon, except that upon written
request of the Company made concurrently with or reasonably promptly after
payment or prepayment in full of any Note, you shall surrender such Note for
cancellation, reasonably promptly after any such request, to the Company at its
principal executive office or at the place of payment most recently designated
by the Company pursuant to Section 14.1. Prior to any sale or other disposition
of any Note held by you or your nominee you will, at your election, either
endorse thereon the amount of principal paid thereon and the last date to which
interest has been paid thereon or surrender such Note to the Company in exchange
for a new Note or Notes pursuant to Section 13.2. The Company will afford the
benefits of this Section 14.2 to any Institutional Investor that is the direct
or indirect
30
transferee of any Note purchased by you under this Agreement and that has made
the same agreement relating to such Note as you have made in this Section 14.2.
15. EXPENSES, ETC.
15.1. TRANSACTION EXPENSES.
Whether or not the transactions contemplated hereby are consummated,
the Company will pay all reasonable costs and expenses (including reasonable
attorneys' fees of a special counsel and, if reasonably required, local or other
counsel) incurred by you and each Other 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 or the Notes (whether or not
such amendment, waiver or consent becomes effective), including, without
limitation: (a) the reasonable costs and expenses incurred in enforcing or
defending (or determining whether or how to enforce or defend) any rights under
this Agreement or the Notes or in responding to any subpoena or other legal
process or informal investigative demand issued in connection with this
Agreement or the Notes, or by reason of being a holder of any Note, (b) if you
acquired your Existing Notes for at least par and your adjusted tax basis in the
Existing Notes is equal to the price paid, excluding any amount paid for accrued
but unpaid interest and reduced by any principal payments received, any and all
tax liability under the Code resulting from the assumption by the Company and
surrender of the Existing Notes and the issuance of the Notes in exchange
therefor pursuant to this Agreement, excluding any tax liability arising from
the receipt of the amendment fee, and (c) the reasonable costs and expenses,
including financial advisors' fees, incurred in connection with the insolvency
or bankruptcy of the Company or any Subsidiary or in connection with any
work-out or restructuring of the transactions contemplated hereby and by the
Notes. The Company will pay, and will save you and each other holder of a Note
harmless from, all claims in respect of any fees, costs or expenses if any, of
brokers and finders (other than those retained by you).
15.2. SURVIVAL.
The obligations of the Company under this Section 15 will survive the
payment or transfer of any Note, the enforcement, amendment or waiver of any
provision of this Agreement or the Notes, and the termination of this Agreement.
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.
All representations and warranties contained herein shall survive the
execution and delivery of this Agreement and the Notes, the purchase or transfer
by you of any Note or portion thereof or interest therein and the payment of any
Note, and may be relied upon by any subsequent holder of a Note, regardless of
any investigation made at any time by or on behalf of you or any other holder of
a Note. All statements contained in any certificate or other instrument
delivered by or on behalf of the Company pursuant to this Agreement shall be
deemed representations and warranties of the Company under this Agreement.
Subject to the preceding sentence, this Agreement and the Notes embody the
entire agreement and understanding between
31
you and the Company and supersede all prior agreements and understandings
relating to the subject matter hereof.
17. AMENDMENT AND WAIVER
17.1. REQUIREMENTS.
This Agreement and the Notes may be amended, and the observance of any
term hereof or of the Notes may be waived (either retroactively or
prospectively), with (and only with) the written consent of the Company and the
Required Holders, except that (a) no amendment or waiver of any of the
provisions of Section 1, 2, 3, 4, 5, 6 or 21 hereof; or any defined term (as it
is used therein), will be effective as to you unless consented to by you in
writing, and (b) no such amendment or waiver may, without the written consent of
the holder of each Note at the time outstanding affected thereby, (i) subject to
the provisions of Section 12 relating to acceleration or rescission, change the
amount or time of any prepayment or payment of principal of, or reduce the rate
or change the time of payment or method of computation of interest or of the
Make-Whole Amount on, the Notes, (ii) change the percentage of the principal
amount of the Notes the holders of which are required to consent to any such
amendment or waiver, or (iii) amend any of Sections 8, 11(a), 11(b), 12, 17 or
20.
17.2. SOLICITATION OF HOLDERS OF THE 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 the 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 the
Notes as consideration for or as an inducement to the entering into by
any holder of the Notes or any waiver or amendment of any of the terms
and provisions hereof unless such remuneration is concurrently paid, or
security is concurrently granted, on the same terms, ratably to each
holder of the Notes then outstanding even if such holder did not consent
to such waiver or amendment.
17.3. BINDING EFFECT, ETC.
Any amendment or waiver consented to as provided in this Section 17
applies equally to all holders of the 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
32
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" or "THE AGREEMENT" and references thereto
shall mean this Agreement as it may from time to time be amended or
supplemented.
17.4. NOTES HELD BY COMPANY, ETC.
Solely for the purpose of determining whether the holders of the
requisite percentage of the aggregate principal amount of Notes then outstanding
approved or consented to any amendment, waiver or consent to be given under this
Agreement or the Notes, or have directed the taking of any action provided
herein or in the Notes to be taken upon the direction of the holders of a
specified percentage of the aggregate principal amount of Notes then
outstanding, Notes directly or indirectly owned by the Company or any of its
Affiliates shall be deemed not to be outstanding.
18. NOTICES.
All notices and communications provided for hereunder shall be in
writing and sent (a) by telecopy if the sender on the same day sends a
confirming copy of such notice by a recognized overnight delivery service
(charges prepaid), or (b) by registered or certified mail with return receipt
requested (postage prepaid), or (c) by a recognized overnight delivery service
(with charges prepaid). Any such notice must be sent:
(i) if to you or your nominee, to you or it at the address
specified for such communications in Schedule A, or at such other
address as you or it shall have specified to the Company in writing,
(ii) if to any other holder of any Note, to such holder at
such address as such other holder shall have specified to the Company
in writing, or
(iii) if to the Company, to the Company at its address set
forth at the beginning hereof to the attention of the General Counsel
or Treasurer, 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.
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 you at the Closing (except the Notes
themselves), and (c) financial statements, certificates and other information
previously or hereafter furnished to you, may be reproduced by you by any
photographic, photostatic, microfilm, microcard, miniature photographic or other
similar process and you may destroy any original document so reproduced. The
Company agrees and stipulates that, to the extent permitted by applicable law,
any such reproduction shall be admissible in evidence as the original itself in
any judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by you in the regular
33
course of business) and any enlargement, facsimile or further reproduction of
such reproduction shall likewise be admissible in evidence. This Section 19
shall not prohibit the Company or any other holder of Notes from contesting any
such reproduction to the same extent that it could contest the original, or from
introducing evidence to demonstrate the inaccuracy of any such reproduction.
20. CONFIDENTIAL INFORMATION.
For the purposes of this Section 20, "CONFIDENTIAL INFORMATION" means
information delivered to you by or on behalf of the Company or any Subsidiary in
connection with the transactions contemplated by or otherwise pursuant to this
Agreement that is proprietary in nature and that was clearly marked or labeled
or otherwise adequately identified (in writing with respect to Confidential
Information delivered subsequent to the date of Closing) when received by you as
being confidential information of the Company or such Subsidiary, PROVIDED that
such term does not include information that (a) was publicly known or otherwise
known to you prior to the time of such disclosure, (b) subsequently becomes
publicly known through no act or omission by you or any person acting on your
behalf, (c) otherwise becomes known to you other than through disclosure by the
Company or any Subsidiary or (d) constitutes financial statements delivered to
you under Section 7.1 that are otherwise publicly available. You will maintain
the confidentiality of such Confidential Information in accordance with
procedures adopted by you in good faith to protect confidential information of
third parties delivered to you, provided that you may deliver or disclose
Confidential Information to (i) your directors, trustees, officers, employees,
agents, attorneys and affiliates (to the extent such disclosure reasonably
relates to the administration of the investment represented by your Notes), (ii)
your financial advisors and other professional advisors who agree to hold
confidential the Confidential Information substantially in accordance with the
terms of this Section 20, (iii) any other holder of any Note, (iv) any
Institutional Investor to which you sell or offer to sell such Note or any part
thereof or any participation therein (if such Person has agreed in writing prior
to its receipt of such Confidential Information to be bound by the provisions of
this Section 20), (v) any Person from which you offer to purchase any security
of the Company (if such Person has agreed in writing prior to its receipt of
such Confidential Information to be bound by the provisions of this Section 20),
(vi) any federal or state regulatory authority having jurisdiction over you,
(vii) the National Association of Insurance Commissioners or any similar
organization, or any nationally recognized rating agency that requires access to
information about your investment portfolio or (viii) any other Person to which
such delivery or disclosure may be necessary or appropriate (w) to effect
compliance with any law, rule, regulation or order applicable to you, (x) in
response to any subpoena or other legal process, (y) in connection with any
litigation to which you are a party or (z) if an Event of Default has occurred
and is continuing, to the extent you may reasonably determine such delivery and
disclosure to be necessary or appropriate in the enforcement or for the
protection of the rights and remedies under your Notes and this Agreement. 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.
34
21. [INTENTIONALLY OMITTED].
22. MISCELLANEOUS.
22.1. SUCCESSORS AND ASSIGNS.
All covenants and other agreements contained in this Agreement by or
on behalf of any of the parties hereto bind and inure to the benefit of their
respective successors and assigns (including, without limitation, any subsequent
holder of a Note) whether so expressed or not.
22.2. PAYMENTS DUE ON NON-BUSINESS DAYS.
Anything in this Agreement or the Notes to the contrary
notwithstanding, any payment of principal of or Make-Whole Amount or interest on
any Note that is due on a date 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.
22.3. SEVERABILITY.
Any provision of this Agreement that is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof; and any such prohibition or unenforceability in any
jurisdiction shall (to the full extent permitted by law) not invalidate or
render unenforceable such provision in any other jurisdiction.
22.4. CONSTRUCTION.
Each covenant contained herein shall be construed (absent express
provision to the contrary) as being independent of each other covenant contained
herein, so that compliance with any one covenant shall not (absent such an
express contrary provision) be deemed to excuse compliance with any other
covenant. Where any provision herein refers to action to be taken by any Person,
or which such Person is prohibited from taking, such provision shall be
applicable whether such action is taken directly or indirectly by such Person.
22.5. COUNTERPARTS.
This Agreement may be executed in any number of counterparts, each of
which shall be an original but all of which together shall constitute one
instrument. Each counterpart may consist of a number of copies hereof; each
signed by less than all, but together signed by all, of the parties hereto.
22.6. GOVERNING LAW.
This Agreement shall be construed and enforced in accordance with, and
the rights of the parties shall be governed by, the law of the State of
Illinois
excluding choice-of-law
35
principles of the law of such State that would require the application of the
laws of a jurisdiction other than such State.
22.7. AMENDMENT AND RESTATEMENT OF EXISTING NOTE AGREEMENT, CONSENT AND
RELEASE.
Upon satisfaction (or waiver in writing by each Purchaser) of the
conditions specified in Section 4 hereof, (a) the Existing Note Agreement shall
be amended and restated in its entirety to read as set forth in this Agreement,
(b) the Purchasers consent to the assumption by the Company of the Existing
Notes and the Existing Note Agreement as provided in Section 1 hereof and (c)
the Purchasers release ▇▇▇▇▇ from all obligations under the Existing Note
Agreement and the Existing Notes.
* * * * *
[SIGNATURE BLOCKS TO FOLLOW]
▇▇▇▇▇▇ CORPORATION
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President & CEO
▇▇▇▇▇ TELECOM, INC.
By: ▇▇▇▇▇ Schroet
Title: Treasurer
The foregoing is agreed
to as of the date thereof:
GREAT-WEST LIFE & ANNUITY
INSURANCE COMPANY
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Assistant Vice President
By: ▇▇▇ ▇▇▇▇▇▇▇▇
Title: Manager - Investments
FARM BUREAU LIFE INSURANCE
COMPANY OF MICHIGAN
By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Portfolio Manager
FARM BUREAU MUTUAL INSURANCE
COMPANY OF MICHIGAN
By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Portfolio Manager
FARM BUREAU GENERAL INSURANCE
COMPANY OF MICHIGAN
By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Portfolio Manager
LONDON LIFE AND GENERAL
REINSURANCE COMPANY LIMITED
By: Orchard Capital Management, LLC, as Investment Advisor
By: ▇▇▇▇ ▇▇▇▇▇▇▇
Title: Manager and Vice President
By: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Authorized Signatory
2
AMERICAN FAMILY LIFE INSURANCE
COMPANY
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Investment Director
CONNECTICUT GENERAL LIFE
INSURANCE COMPANY
By CIGNA Investments, Inc. (authorized agent)
By: ▇▇▇▇▇ ▇. Height
Title: Managing Director
PAN-AMERICAN LIFE INSURANCE
COMPANY
By: ▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
Title: Senior Vice President, Investments
THE GUARDIAN LIFE INSURANCE
COMPANY OF AMERICA
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Director
3
SCHEDULE A
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Notes to be Received
--------------------------------------------------------
Name of Purchaser Series 2003-A Series 2003-B Series 2003-C
----------------- ------------- ------------- -------------
GREAT-WEST LIFE & ANNUITY
INSURANCE COMPANY $14,333,333.34
Great-West Life & Annuity Insurance Company
3rd Floor, Tower 2
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
PAYMENTS OF PRINCIPAL AND INTEREST
WIRE INSTRUCTIONS:
ABA #▇▇▇-▇▇▇-▇▇▇ ▇▇▇▇▇▇▇/▇▇▇/▇▇▇▇▇▇▇▇▇▇
▇&▇ Department - GWL #640935
Special Instructions: 1) security description (PPN #),
2) allocation of payment between principal and
interest, and
3) confirmation of principal balance.
NOTICE OF SUCH PAYMENTS
The Bank of New York
Institutional Custody Department, 14th Floor
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopier: 212.635.8844
NOTICE FOR OTHER COMMUNICATIONS / FINANCIAL STATEMENTS, TRUSTEE REPORTS, ETC.
Great-West Life & Annuity Insurance Company
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Finance Investments
Telecopier: 303.737.6193
1
Schedule A
PHYSICAL DELIVERY OF SECURITIES - NEW ISSUE
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, Window A
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Receive/Deliver Department - GWL # 640935
Tax Identification Number: ▇▇-▇▇▇▇▇▇▇
2
Schedule A
SCHEDULE A
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Notes to be Received
------------------------------------------------------
Name of Purchaser Series 2003-A Series 2003-B Series 2003-C
----------------- ------------- ------------- --------------
GREAT-WEST LIFE & ANNUITY
INSURANCE COMPANY $2,333,333.48
Great-West Life & Annuity Insurance Company
3rd Floor, Tower 2
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
PAYMENTS OF PRINCIPAL AND INTEREST
WIRE INSTRUCTIONS:
ABA #▇▇▇-▇▇▇-▇▇▇ BKofNYC/CTR/BBK=IOC566
P & I Dept./Guaranteed Period Fund MVA/640939
Special Instructions: 1) security description (PPN #),
2) allocation of payment between principal and
interest, and
3) confirmation of principal balance.
NOTICE OF SUCH PAYMENTS
The Bank of New York
Attn: GWL&A Administrator
Institutional Custody Department, 14th Floor
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopier: 212.635.8844
NOTICE FOR OTHER COMMUNICATIONS / FINANCIAL STATEMENTS, TRUSTEE REPORTS, ETC.
Great-West Life & Annuity Insurance Company
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Finance Investments
3
Schedule A
Facsimile: 303.737.6193
PHYSICAL DELIVERY OF SECURITIES - NEW ISSUE
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, Window A
Attn: Receive/Deliver Department - GWL #640939
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Tax Identification Number: ▇▇-▇▇▇▇▇▇▇
4
Schedule A
SCHEDULE A
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Notes to be Received
-------------------------------------------------------
Name of Purchaser Series 2003-A Series 2003-B Series 2003-C
----------------- ------------- ------------- -------------
GREAT-WEST LIFE & ANNUITY $9,000,000
INSURANCE COMPANY
Great-West Life & Annuity Insurance Company
3rd Floor, Tower 2
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
PAYMENTS OF PRINCIPAL AND INTEREST
WIRE INSTRUCTIONS:
ABA #▇▇▇-▇▇▇-▇▇▇ ▇▇▇▇▇▇▇/▇▇▇/▇▇▇▇▇▇▇▇▇▇
▇&▇ Department - GWL #640935
Special Instructions: 1) security description (PPN #),
2) allocation of payment between principal and
interest, and
3) confirmation of principal balance.
NOTICE OF SUCH PAYMENTS
The Bank of New York
Institutional Custody Department, 14th Floor
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopier: 212.635.8844
NOTICE FOR OTHER COMMUNICATIONS / FINANCIAL STATEMENTS, TRUSTEE REPORTS, ETC.
-----------------------------------------------------------------------------
Great-West Life & Annuity Insurance Company
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Finance Investments
Telecopier: 303.737.6193
5
Schedule A
PHYSICAL DELIVERY OF SECURITIES - NEW ISSUE
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, Window A
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Receive/Deliver Department - GWL # 640935
Tax Identification Number: ▇▇-▇▇▇▇▇▇▇
6
Schedule A
SCHEDULE A
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Notes to be Received
---------------------------------------------------- -
Name of Purchaser Series 2003-A Series 2003-B Series 2003-C
----------------- ------------- ------------- -------------
FARM BUREAU LIFE INSURANCE $3,000,000
COMPANY OF MICHIGAN
(1) Wire Instructions for Income:
Comerica Bank
ABA #▇▇▇▇▇▇▇▇▇
Credit Trust Operations
Fixed Income Unit
Acct. # 21585-98530
(Security Name)
(Principal ________ Interest______)
(2) Address to Use for Any Notices:
Farm Bureau Life Insurance Company of Michigan
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ - Investment Division
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Overnight Address:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With Copies to:
Comerica Bank
Trust Operations
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
And
7
Schedule A
Great-West Life & Annuity Insurance Company
3rd Floor, Tower 2
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Corporate Finance Investments
(3) Delivery Instructions for the Securities:
Comerica Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ - MC3462
Tax Identification Number: ▇▇-▇▇▇▇▇▇▇
8
Schedule A
SCHEDULE A
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Notes to be Received
-------------------------------------------------------
Name of Purchaser Series 2003-A Series 2003-B Series 2003-C
----------------- -------------- ------------- -------------
FARM BUREAU MUTUAL $1,000,000
INSURANCE COMPANY OF
MICHIGAN
(1) Wire Instructions for Income:
Comerica Bank
ABA #▇▇▇▇▇▇▇▇▇
Credit Trust Operations
Fixed Income Unit
Acct. # 21585-98530
(Security Name)
(Principal ________ Interest______)
(2) Address to Use for Any Notices:
Farm Bureau Mutual Insurance Company of Michigan
c/o Farm Bureau Life Insurance Company of Michigan
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ - Investment Division
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Overnight Address:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With Copies to:
Comerica Bank
Trust Operations
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
And
9
Schedule A
Great-West Life & Annuity Insurance Company
3rd Floor, Tower 2
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Corporate Finance Investments
(3) Delivery Instructions for the Securities:
Comerica Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ - MC3462
Tax Identification Number: ▇▇-▇▇▇▇▇▇▇
10
Schedule A
SCHEDULE A
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Notes to be Received
-------------------------------------------------------
Name of Purchaser Series 2003-A Series 2003-B Series 2003-C
----------------- -------------- -------------- -------------
FARM BUREAU GENERAL $1,000,000
INSURANCE COMPANY OF
MICHIGAN
(1) Wire Instructions for Income:
Comerica Bank
ABA #▇▇▇▇▇▇▇▇▇
Credit Trust Operations
Fixed Income Unit
Acct. # 21585-98530
(Security Name)
(Principal ________ Interest______)
(2) Address to Use for Any Notices:
Farm Bureau General Insurance Company of Michigan
c/o Farm Bureau Life Insurance Company of Michigan
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ - Investment Division
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Overnight Address:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With Copies to:
Comerica Bank
Trust Operations
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
And
11
Schedule A
Great-West Life & Annuity Insurance Company
3rd Floor, Tower 2
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Corporate Finance Investments
(3) Delivery Instructions for the Securities:
Comerica Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ - MC3462
Tax Identification Number: ▇▇-▇▇▇▇▇▇▇
12
Schedule A
SCHEDULE A
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Notes to be Received
-------------------------------------------------------
Name of Purchaser Series 2003-A Series 2003-B Series 2003-C
----------------- ------------- ------------- -------------
LONDON LIFE AND GENERAL $5,000,000
REINSURANCE COMPANY LIMITED
(1) All payments by wire transfer of immediately available federal funds
to:
ABA #▇▇▇▇▇▇▇▇▇ Comerica Bank/a/c 21585-98546
FBO LLGRC Capital & Surplus/02-01-100-0734934
Special Instructions:
(a) security description (PPN #),
(b) allocation of payment between principal and interest, and
(c) confirmation of principal balance.
(2) All notices of payments:
Comerica Bank
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Private Placements Income
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(3) All other communications, financial statements, trustee reports, etc.:
London Life and General Reinsurance Company Limited
c/o Orchard Capital Management, LLC
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Finance Investments
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
13
Schedule A
(4) Address for delivery of Notes - new issue:
Comerica Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Trust Asset Control
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Tax Identification Number: ▇▇-▇▇▇▇▇▇▇
14
Schedule A
SCHEDULE A
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Notes to be Received
------------------------------------------------------
Name of Purchaser Series 2003-A Series 2003-B Series 2003-C
----------------- ------------- ------------- -------------
AMERICAN FAMILY LIFE $5,833,333.38
INSURANCE COMPANY
Nominee Name in which Notes are to be issued: BAND & Co.
(1) All payments by wire transfer of immediately available federal funds
to:
US Bank Milwaukee, N.A.
ABA #▇▇▇▇▇▇▇▇▇
For Credit to Account #▇▇▇-▇▇▇-▇▇▇
For Further Credit to Account 000018012500 for AFLIC-Traditional
Portfolio
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ (▇▇▇) ▇▇▇-▇▇▇▇
Credit for CUSIP #___________
Each such wire transfer shall set forth the name of the Company, the
full title (including the coupon rate and final maturity date) of the
Notes, the due date, and application among principal and interest of
the payment being made.
(2) All notices of payments and written confirmations of such wire
transfers:
American Family Life Insurance Company
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: Investment Division - Private Placements
(3) All other communications:
American Family Life Insurance Company
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: Investment Division - Private Placements
15
Schedule A
(4) Address for delivery of Notes:
US Bank Milwaukee, N.A.
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ (▇▇-▇▇-1E)
Trust Officer, Account Manager
▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Business Custody
with a copies to:
American Family Life Insurance Company
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: Investment Division - Private Placements
Tax Identification Number: ▇▇-▇▇▇▇▇▇▇
16
Schedule A
SCHEDULE A
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Notes to be Received
-------------------------------------------------------
Name of Purchaser Series 2003-A Series 2003-B Series 2003-C
----------------- ------------- ------------- -------------
CONNECTICUT GENERAL LIFE
INSURANCE COMPANY $1,000,000.00
833,333.34
366,666.66
346,666.66
333,333.34
120,000.00
Nominee Name in which Notes are to be issued: CIG & Co.
(1) All payments by Federal Funds wire transfer of immediately available
funds to:
▇.▇.▇▇▇▇▇▇ Chase Bank
BNF=CIGNA Private Placements/AC=9009001802
ABA# ▇▇▇▇▇▇▇▇▇
with the following accompanying information:
OBI=[name of company; description of security; interest rate;
maturity date; PPN; due date and application (as among principal,
premium and interest of the payment being made); contact name and
phone]
(2) Notices related to payments:
CIG & Co.
c/o CIGNA Investments, Inc.
Attention: Securities Processing - H05P
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
CIG& Co.
c/o CIGNA Retirement & Investment Services
Attention: Private and Alternative Investments, H16B
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
17
Schedule A
with a copy to:
▇.▇.▇▇▇▇▇▇ ▇▇▇▇▇ Bank
Private Placement Servicing
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: CIGNA Private Placements
Funds Clearance #8008
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
(3) All other communications:
CIG & Co.
c/o CIGNA Retirement & Investment Services
Attention: Private and Alternative Investments, H16B
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Tax Identification Number: ▇▇-▇▇▇▇▇▇▇ (for CIG & Co.)
18
Schedule A
SCHEDULE A
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Notes to be Received
-------------------------------------------------------
Name of Purchaser Series 2003-A Series 2003-B Series 2003-C
----------------- ------------- ------------- -------------
PAN-AMERICAN LIFE INSURANCE $4,166,666.70
COMPANY
(1) All payments by wires transfer of immediately available federal funds
to:
PAN-AMERICAN LIFE INSURANCE COMPANY
Account #5520110029496
Bank One, Louisiana, NA
ABA #▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
identifying the issue by PPN and description of security, and providing
complete details, including breakdown of interest and principal.
(2) All notices of payments and written confirmations of such wire
transfers:
Pan-American Life Insurance Company
Attn: Bond & Stock Accounting - 28th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
(3) All other communications:
Pan-American Life Insurance Company
Attn: Investment Department - 28th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(4) Address for delivery of Notes:
Pan-American Life Insurance Company
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ - 28th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Tax Identification Number: ▇▇-▇▇▇▇▇▇▇
19
Schedule A
SCHEDULE A
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Notes to be Received
----------------------- --------------------- ---------
Name of Purchaser Series 2003-A Series 2003-B Series 2003-C
----------------- ------------- ------------- -------------
THE GUARDIAN LIFE INSURANCE COMPANY OF AMERICA $2,500,000
(1) All payments by wire transfer of immediately available federal funds
to:
JPMorgan Chase
FED ABA #▇▇▇▇▇▇▇▇▇
Chase/NYC/CTR/BNF
A/C ▇▇▇-▇-▇▇▇▇▇▇
Reference A/C #G05978, Guardian Life
with sufficient information (including issuer, PPN, interest rate,
maturity and whether payment is of principal, premium or interest) to
identify the sources and application of such funds.
(2) All notices of payments and written confirmations of such wire
transfers:
The Guardian Life Insurance Company of America
Attention: Investment Accounting Dept. 17-B
▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(3) All other communications:
The Guardian Life Insurance Company of America
c/o Berkshire Life Insurance Company of America
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Taxpayer Identification Number: ▇▇-▇▇▇▇▇▇▇
20
Schedule A
Schedule B
DEFINED TERMS
As used herein, the following terms have the respective meanings set
forth below or set forth in the Section hereof following such term:
"ADJUSTED CONSOLIDATED NET WORTH" means, as of any date, consolidated
stockholders' equity of the Company and its Subsidiaries on such date,
determined in accordance with GAAP, less the amount by which outstanding
Restricted Investments on such date exceed 20% of the sum on such date of
Consolidated Indebtedness and consolidated stockholders equity of the Company
and its Subsidiaries determined in accordance with GAAP.
"AFFILIATE" means, at any time, and with respect to any Person, (a)
any other Person that at such time directly or indirectly through one or more
intermediaries Controls, or is Controlled by, or is under common Control with,
such first Person, and (b) any Person beneficially owning or holding, directly
or indirectly, 20% or more of any class of voting or equity interests of the
Company or any Subsidiary or any corporation of which the Company and its
Subsidiaries beneficially own or hold, in the aggregate, directly or indirectly,
20% or more of any class of voting or equity interests. As used in this
definition, "CONTROL" means the possession, directly or indirectly, of the power
to direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise.
Unless the context otherwise clearly requires, any reference to an "Affiliate"
is a reference to an Affiliate of the Company.
"▇▇▇▇▇ TELECOM" is defined in the first paragraph of this Agreement.
"▇▇▇▇▇ CLOSING DATE" means the date on which all conditions precedent
to the Merger have been satisfied and the Merger has been consummated pursuant
to the Merger Agreement.
"ACQUISITION SUB" is defined in the Introduction to this Agreement.
"▇▇▇▇▇▇ AMPLIFIERS" means ▇▇▇▇▇▇ Amplifiers, Inc., a Delaware
corporation.
"BANK LENDERS" means the lenders parties to the Credit Agreement.
"BUSINESS DAY" means (a) for the purposes of Section 8.6 only, any day
other than a Saturday, a Sunday or a day on which commercial banks in New York
City are required or authorized to be closed, 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 Chicago,
Illinois or New York City 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.
"CLOSING" is defined in Section 3.
1
Schedule B
"CLOSING DATE" 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 ▇▇▇▇▇▇ Corporation, a Delaware corporation.
"CONFIDENTIAL INFORMATION" is defined in Section 20.
"CONSOLIDATED INDEBTEDNESS" means, as of any date, Indebtedness of the
Company and its Subsidiaries as of such date determined on a consolidated basis
in accordance with GAAP.
"CONSOLIDATED EBITDA" means, with respect to any Person for any period
of determination, Consolidated Operating Income of such Person for such period,
plus, without duplication and to the extent deducted in determining Consolidated
Operating Income, (i) depreciation, (ii) amortization and (iii) interest income
of such Person and its consolidated Subsidiaries and, in the case of the
Company, all non-cash restructuring charges incurred in connection with the
Merger for such period and, with respect to ▇▇▇▇▇ from and after the ▇▇▇▇▇
Closing Date, if the applicable period of determination includes any period of
time prior to the ▇▇▇▇▇ Closing Date, Consolidated EBITDA of the Company shall
be calculated by adding to Consolidated Operating Income of the Company the
depreciation, amortization and interest income of ▇▇▇▇▇ for such period of time
prior to the ▇▇▇▇▇ Closing Date as is included in the applicable period of
determination, all as determined on a consolidated basis in accordance with
GAAP.
"CONSOLIDATED NET INCOME" means, with respect to any Person for any
period, the net income of such Person and its consolidated Subsidiaries for such
period determined on a consolidated basis in accordance with GAAP.
"CONSOLIDATED NET WORTH" means, with respect to any Person at any date
of determination thereof, the total of shareholders' equity (including capital
stock, additional paid-in capital and retained earnings after deducting treasury
stock) of such Person and its consolidated Subsidiaries at such date determined
on a consolidated basis in accordance with GAAP.
"CONSOLIDATED OPERATING INCOME" means, with respect to any Person for
any period of determination, the operating income of such Person and its
consolidated Subsidiaries for such period determined on a consolidated basis in
accordance with GAAP, and with respect to ▇▇▇▇▇ from and after the ▇▇▇▇▇ Closing
Date, if the applicable period of determination includes any period of time
prior to the ▇▇▇▇▇ Closing Date, Consolidated Operating Income of the Company
shall include the operating income of ▇▇▇▇▇ Telecom for such period of time
prior to the ▇▇▇▇▇ Closing Date as is included in the applicable period of
determination, all as determined in accordance with GAAP.
"CONSOLIDATED TOTAL DEBT" means, with respect to any Person at any
date of determination thereof, the aggregate amount of those items of
Indebtedness of such Person and
2
Schedule B
its consolidated Subsidiaries included in clauses (a), (b), (c), (e), (f) and
(g) of the definition of "Indebtedness" determined on a consolidated basis in
accordance with GAAP.
"CONSOLIDATED TOTAL DEBT TO EBITDA RATIO" means, with respect to any
Person at any date of determination thereof, the ratio of (i) Consolidated Total
Debt of such Person, to (ii) Consolidated EBITDA of such Person for the four
immediately preceding Fiscal Quarters.
"CONSOLIDATED TANGIBLE ASSETS" means, with respect to any Person at
any date of determination thereof, (i) Consolidated Total Assets of such Person
on that date, less (ii) all assets of such Person and its consolidated
Subsidiaries as are properly classified as intangible assets in accordance with
GAAP, including customer lists, goodwill, copyrights, trade names, trademarks,
patents, unamortized deferred charges, unamortized debt discount and capitalized
research and development costs.
"CONSOLIDATED TOTAL ASSETS" means, with respect to any Person as of
any date, the assets and properties of such Person and its Subsidiaries as of
such date determined on a consolidated basis in accordance with GAAP.
"CONSOLIDATED TOTAL CAPITALIZATION" means, as of any date, the sum of
Consolidated Indebtedness and Adjusted Consolidated Net Worth as of such date.
"CREDIT AGREEMENT" means the Amended and Restated Credit Agreement,
dated as of December 19, 2002, among the Company, Designated Subsidiaries of the
Company, the Bank Lenders, Bank of America, N.A., as the Administrative Agent,
Swing Line Lender and L/C Issuer, LaSalle Bank National Association, as
Syndication Agent, U.S. Bank National Association, as Documentation Agent, and
Banc of America Securities LLC, as sole Lead Arranger and Sole Bank Manager, as
amended, supplemented, restated or otherwise modified from time to time, and any
agreement refinancing or replacing the Credit Agreement.
"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 Bank of America National Trust & Savings Association in Chicago,
Illinois as
its "base" or "prime" rate.
"DOMESTIC SUBSIDIARY" means any Subsidiary organized under the laws of
the United States or any State thereof (including the District of Columbia).
"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.
3
Schedule B
"EQUITY INTERESTS" means (a) with respect to a corporation, shares of
the capital stock of such corporation and (b) with respect to a partnership,
limited liability company or other persons, partnership, limited liability or
other equity interests in such Person.
"EQUITY ISSUANCE" means any issuance and sale by the Company or by any
Subsidiary to a Person other than the Company or any Subsidiary, of any Equity
Interests of the Company or any Subsidiary or any Rights in respect thereof.
"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.
"EXISTING ▇▇▇▇▇ CREDIT AGREEMENT" means the Credit Agreement, dated as
of December 31, 1998, among ▇▇▇▇▇, the financial institutions named as lenders
therein, and Key Bank National Association, as Administrative Agent, as amended.
"EXISTING NOTES" is defined in the Introduction to this Agreement.
"EXISTING NOTE AGREEMENT" is defined in the Introduction to this
Agreement.
"FISCAL QUARTER" means any quarter of a Fiscal Year.
"FISCAL YEAR" means any period of twelve consecutive calendar months
ending on September 30th; references to a Fiscal Year with a number
corresponding to any calendar year (E.G. the "2003 Fiscal Year") refer to the
Fiscal Year ending on the September 30th occurring during such calendar year.
"GAAP" means generally accepted accounting principles as in effect
from time to time in the United States of America.
"GOVERNMENTAL AUTHORITY" MEANS
(a) the government of
(i) the United States of America or any State or other political
subdivision thereof, or
(ii) any jurisdiction in which the Company or any Subsidiary
conducts all or any part of its business, or which asserts
jurisdiction over any properties of the Company or any Subsidiary, or
4
Schedule B
(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.
"HAZARDOUS MATERIAL" means any and all pollutants, toxic or hazardous
wastes or any other substances that might pose a hazard to health or safety, the
removal of which may be required or the generation, manufacture, refining,
production, processing, treatment, storage, handling, transportation, transfer,
use, disposal, release, discharge, spillage, seepage, or filtration of which is
or shall be restricted, prohibited or penalized by any applicable law
(including, without limitation, asbestos, urea formaldehyde foam insulation and
polychlorinated biphenyls).
"HEDGING OBLIGATIONS" mean, with respect to any Person, all
liabilities of such Person under interest rate swap agreements, interest rate
cap agreements and interest rate collar agreements, and all other agreements or
arrangements designed to protect such Person against fluctuations in interest
rates or currency exchange rates.
"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,
5
Schedule B
(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments;
(b) all obligations, contingent or otherwise, relative to the face
amount of all letters of credit, whether or not drawn, and banker's
acceptances issued for the account of such Person;
(c) all obligations of such Person as lessee under leases which have
been or should be, in accordance with GAAP, recorded as Capital Leases;
(d) all other items which, in accordance with GAAP, would be included
as liabilities on the liability side of the balance sheet of such Person
as of the date at which Indebtedness is to be determined;
(e) net liabilities of such Person under all Hedging Obligations;
(f) whether or not so included as liabilities in accordance with
GAAP, all obligations of such Person to pay the deferred purchase
price of property or services, and indebtedness (excluding prepaid
interest thereon) secured by a Lien on property owned or being
purchased by such Person (including indebtedness arising under
conditional sales or other title retention agreements), whether or not
such indebtedness shall have been assumed by such Person or is limited
in recourse; and
(g) all Guaranties of such Person in respect of any of the foregoing.
Indebtedness 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. Indebtedness of the Company or a
Subsidiary shall not include Indebtedness of the Company to a Subsidiary or
Indebtedness of a Subsidiary to the Company or to another Subsidiary.
"INSTITUTIONAL INVESTOR" means (a) any Purchaser, (b) any holder of a
Note holding more than $2,000,000 in aggregate principal amount of the Notes,
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.
"INVESTMENTS" means all investments made, in cash or by delivery of
property, directly or indirectly, by any Person, in any other Person or
property, whether by acquisition of shares of capital stock, indebtedness or
other obligations or securities or by loan, advance, capital contribution or
otherwise.
"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).
6
Schedule B
"MAKE-WHOLE AMOUNT" is defined in Section 8.6.
"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 Series 2003 Notes, or
(c) the validity or enforceability of this Agreement or the Series 2003 Notes.
"MATERIAL SUBSIDIARY" means, as of the date of determination, any
Subsidiary the assets or revenues of which account for more than 5% of
Consolidated Total Assets of the Company at the end of the most recently ended
fiscal period or more than 5% of the consolidated revenues of the Company and
its Subsidiaries for the most recently completed four fiscal quarters.
"MEMORANDUM" is defined in Section 5.3.
"MERGER" is defined in the Introduction to this Agreement.
"MERGER AGREEMENT" is defined in the Introduction to this Agreement.
"MULTIEMPLOYER PLAN" means any Plan that is a "multiemployer plan" (as
such term is defined in section 4001(a)(3) of ERISA).
"NOTES" is defined in Section 2.
"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.
"OTHER PURCHASERS" is defined in Section 2.
"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.
7
Schedule B
"PRIORITY DEBT" means, as of any date, the sum (without duplication)
of (a) Indebtedness of Subsidiaries on such date and (b) Indebtedness of the
Company and its Subsidiaries secured by Liens permitted by Section 10.2(i) on
such date.
"PROPERTY" or "PROPERTIES" means, unless otherwise specifically
limited, real or personal property of any kind, tangible or intangible, ▇▇▇▇▇▇
or inchoate.
"PURCHASER" means each Person listed in Schedule A.
"QPAM EXEMPTION" means Prohibited Transaction Class Exemption 84-14
issued by the United States Department of Labor.
"REQUIRED HOLDERS" means, at any time, the holders of at least a
majority 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.
"RESTRICTED INVESTMENTS" means all Investments of the Company and its
Subsidiaries, other than:
(a) property or assets to be used or consumed in the ordinary course
of business;
(b) assets arising from the sale of goods or services in the ordinary
course of business;
(c) Investments in Subsidiaries or in any Person that, as a result
thereof, becomes a Subsidiary;
(d) Investments existing as of the date of this Agreement that are
listed in the attached Schedule ▇-▇;
(e) Investments in treasury stock;
(f) Investments in:
(i) obligations, maturing within five years from the date of
acquisition, of or fully guaranteed by (A) the United States of
America or an agency thereof or (B) Canada or a province thereof;
(ii) state or municipal securities (including auction rate
floaters and variable rate demand Notes), having an effective maturity
within one year from the date of acquisition, which are rated in one
of the top two rating classifications by at least one nationally
recognized rating agency;
8
Schedule B
(iii) certificates of deposit or banker's acceptances maturing
within one year from the date of acquisition of or issued by Bank of
America National Trust & Savings Association or other commercial banks
whose long-term unsecured debt obligations (or the long-term unsecured
debt obligations of the bank holding company owning all of the capital
stock of such bank) are rated in one of the top two rating
classifications by at least one nationally recognized rating agency;
(iv) commercial paper maturing within 270 days from the date
of issuance which, at the time of acquisition, is rated in one of the
top two rating classifications by at least one credit rating agency of
recognized national standing;
(v) repurchase agreements, having a term of not more than 90
days and fully collateralized with obligations of the type described
in clause (i), with a bank satisfying the requirements of clause
(iii);
(vi) money market instrument programs that are properly
classified as current assets in accordance with GAAP; and
(vii) loans or advances not in excess of .5% of Adjusted
Consolidated Net Worth made in the ordinary course of business to
officers, directors and employees for incidental expenses;
For purposes of this Agreement, an Investment shall be valued in accordance with
GAAP.
"RIGHTS" means, with respect to any Person, warrants, options or other
rights to acquire Equity Interests in such Person.
"SECURITIES ACT" means the Securities Act of 1933, as amended from
time to time.
"SENIOR FINANCIAL OFFICER" means the chief financial officer,
principal accounting officer, treasurer or comptroller of the Company.
"SERIES 1997 NOTES" is defined in the Introduction to this Agreement.
"SERIES 1997-A NOTES" is defined in the Introduction to this
Agreement.
"SERIES 1997-B NOTES" is defined in the Introduction to this
Agreement.
"SERIES 1997-C NOTES" is defined in the Introduction to this
Agreement.
"SERIES 2003 NOTES" is defined in Section 2.
"SERIES 2003-ANOTES" is defined in Section 2.
"SERIES 2003-B NOTES" is defined in Section 2.
"SERIES 2003-C NOTES" is defined in Section 2.
9
Schedule B
"SOURCE" is defined in Section 6.2
"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.
"THIS AGREEMENT" or "THE AGREEMENT" is defined in Section 17.3.
"WHOLLY-OWNED SUBSIDIARY" means, at any time, any Subsidiary 100% of
all of the equity interests (except directors' qualifying shares) and voting
interests of which are owned by any one or more of the Company and the Company
other Wholly-Owned Subsidiaries at such time.
10
Schedule B
SCHEDULE ▇-▇
OUTSTANDING INVESTMENTS
None
Schedule B-1
SCHEDULE 4.9
CHANGES IN CORPORATE STRUCTURE
None
Schedule 4.9
SCHEDULE 5.3
DISCLOSURE MATERIALS
Joint Proxy Statement/Prospectus dated June 10, 2003 of ▇▇▇▇▇▇ Corporation and
▇▇▇▇▇ Telecom, Inc.
Schedule 5.3
SCHEDULE 5.4
▇▇▇▇▇▇ CORPORATION SUBSIDIARIES
AND OWNERSHIP OF SUBSIDIARY STOCK
The following is a list of the subsidiaries of ▇▇▇▇▇▇ Corporation and indented,
subsidiaries of such subsidiaries, including in each case the state or other
jurisdiction in which each subsidiary was incorporated or organized, and
indicating in each case the percentage of voting securities owned by the
immediate parent.
DOMESTIC SUBSIDIARIES
JURISDICTION OF
NAME OF SUBSIDIARY INCORPORATION STOCK OWNERSHIP
---------------------------------------------------- -------------------------------- -------------------------
▇▇▇▇▇▇ International Corporation State of Illinois 100%
▇▇▇▇▇▇ Amplifiers Inc. State of Delaware 100%
▇▇▇▇▇▇ Systems Inc. State of Delaware 100%
▇▇▇▇▇▇ Passive Power Products Inc. State of Delaware 100%
▇▇▇▇▇▇ International Holding Corporation State of Delaware 100%
▇▇▇▇▇▇ International Corporation State of Delaware 100%
▇▇▇▇▇▇ Data Corporation State of Delaware 100%
▇▇▇▇▇▇ KMW Systems Inc. (to be dissolved) State of Delaware 100%
▇▇▇▇▇▇ Financial Services Corporation State of Delaware 100%
▇▇▇▇▇▇ International Services Corporation State of Illinois 100%
▇▇▇▇▇▇ Structures Corporation State of Oklahoma 100%
▇▇▇▇▇▇ Government Products Inc. State of Texas 100%
▇▇▇▇▇▇ Corporation (Wyoming) State of Wyoming 100%
▇▇▇▇▇▇ Distributed Systems Inc. State of Delaware 100%
▇▇▇▇▇▇ Kintec Inc. State of Florida 100%
▇▇▇▇▇▇ New Zealand Inc. State of Delaware 100%
Adirondacks LLC State of Delaware 100%
The ▇▇▇▇▇ Group International, Inc. State of Delaware 100%
Antenna Specialists Co., Inc. State of Delaware 100%
▇▇▇▇▇ Telecom Investments, Inc. State of Delaware 100%
ATI International, Inc. State of Delaware 100%
Comsearch Holdings Inc. State of Delaware 100%
Geometrix911, Inc. State of Delaware 100%
Orion Far East Management Inc. (1) State of Delaware 100%
Schedule 5.4
FOREIGN SUBSIDIARIES
JURISDICTION OF
NAME OF SUBSIDIARY INCORPORATION STOCK OWNERSHIP
---------------------------------------------------- -------------------------------- -------------------------
▇▇▇▇▇▇ Foreign Sales Corporation Barbados 100%
▇▇▇▇▇▇ ▇▇ Brazil, Ltda. Brazil 100%
▇▇▇▇▇▇ Installacoes e Servicos Ltda. Brazil 100%
▇▇▇▇▇▇ Canada Inc. Canada 100%
▇▇▇▇▇▇ Cayman Islands Ltd. Cayman Islands 100%
▇▇▇▇▇▇ Telecommunications (China) Co. Ltd. China 100%
▇▇▇▇▇▇ Telecommunications s.r.o.(ACZ) Czech Republic 100%
▇▇▇▇▇▇ Communications OY Finland 100%
▇▇▇▇▇▇ S.A.R.L. France 100%
▇▇▇▇▇▇ GmbH Germany 100%
▇▇▇▇▇▇ Telecommunications India Pvt. Ltd. India 100%
▇▇▇▇▇▇ S.R.L. Italy 100%
▇▇▇▇▇▇ Japan K.K. Japan 100%
▇▇▇▇▇▇ Telecommunications (Malaysia) Sdn. Bhd. Malaysia 100%
▇▇▇▇▇▇ Corporation Mauritius Mauritius 100%
▇▇▇▇▇▇ Corporation (Mexico) S.A. de C.V. Mexico 100%
▇▇▇▇▇▇ Antenas deReynosa,S. deR.L. deC.V. (Reynosa) Mexico 100%
▇▇▇▇▇▇ Manufacturas de Mexico, S.deR.L.deC.V. Mexico 100%
(Nogales)
▇▇▇▇▇▇ Holdings Mexicana S.A. de C.V. Mexico 100%
Distribudora ▇▇▇▇▇▇ S.A. de C.V. Mexico 100%
▇▇▇▇▇▇ Wireless Products B.V. Netherlands 100%
▇▇▇▇▇▇ (Philippines) Inc. Philippines 100%
▇▇▇▇▇▇ AO Russia 100%
▇▇▇▇▇▇ Systems LLC Russia 100%
▇▇▇▇▇▇ Telecommunications (Singapore) Pte. Ltd. Singapore 100%
▇▇▇▇▇▇ Satcom Africa (Pty.) Ltd. South Africa 100%
Satcom Installation Services (Pty.) Ltd. South Africa 100%
Systems Design (Pty) Ltd. South Africa 40%
▇▇▇▇▇▇ Espana, S.A. Spain 100%
▇▇▇▇▇▇ AB Sweden 100%
▇▇▇▇▇▇ AG Switzerland 100%
▇▇▇▇▇▇ Kommunikationssysteme AG Switzerland 100%
Quasar Technology Ltd. United Kingdom 100%
Quasar Microwave Technology Limited United Kingdom 100%
The ▇▇▇▇▇ Group Canada Limited Ontario, Canada 100%
Placo Switzerland 100%
Mikom Italia Italy 100%
Herkules Vierte Verwaltungs G.m.b.H. Germany 100%
Mikom France France 100%
Schedule 5.4
JURISDICTION OF
NAME OF SUBSIDIARY INCORPORATION STOCK OWNERSHIP
---------------------------------------------------- -------------------------------- -------------------------
Decibel Mobilcom GmbH Germany 100%
Mikom G.m.b.H. Germany 100%
Mikom Vertriebs und Service GmbH (8) Austria 100%
Mikom Slovakia, s.r.o. Slovakia 60%
Mitras Ltd. Hungary 100%
C-com, spol. s.r.o. Czechoslovakia 80%
▇▇▇▇▇ Telecom Canada, Inc. Ontario 100%
▇▇▇▇▇ Telecom Civil Law Partnership GbR(2) Germany 100%
▇▇▇▇▇ Telecom (France) S.A. (3) France 100%
Telia S.A. (4) France 100%
▇▇▇▇▇ Telecom Group Limited (1) U.K. 100%
▇▇▇▇▇ Telecom (Holdings) Pty Limited Australia 100%
▇▇▇▇▇ Telecom (Australia) Pty Limited (5) Australia 100%
▇▇▇▇▇ Telecom (Hong Kong) Limited (6) Hong Kong 100%
▇▇▇▇▇ Telecom (Mauritius) Holdings Ltd. Mauritius 100%
Decibel Products (Guangzhou) Ltd. China 100%
Decibel Shenzhen Ltd. China 100%
Forem Shenzhen Ltd. China 100%
▇▇▇▇▇ Telecom (Singapore) Pte Limited Singapore 100%
▇▇▇▇▇ Telecomunicacoes do Brasil Ltda (7) Brazil 100%
Antespec, S.A. de C.V. Mexico 100%
▇▇▇▇▇ Telecom Hungary Holdings Ltd Hungary 100%
▇▇▇▇▇ International (Netherlands) BV Netherlands 100%
▇▇▇▇▇ Telecom (Netherlands) BV Netherlands 100%
Mikom Schweiz AG Switzerland 100%
FOREM S.r.l. Italy 100%
Mikom (UK) Limited U.K. 100%
FOREM Finance UK Limited U.K. 100%
Tekmar Sistemi S.r.l. Italy 100%
Comsearch UK Limited U.K. 100%
Telespectro de Mexico, S.A. de C.V. (9) Mexico 100%
Decibel Mobilcom Limited (1) England 100%
Orion Industries, Inc., Limited (1) Hong Kong 100%
Orion Imports & Exports Limited (1) Hong Kong 100%
Orion Industries, Inc. Japan (1) Japan 100%
Orion Industries Taiwan Limited (1) Taiwan 100%
(1) These subsidiaries are not significant in the aggregate and are no longer
active.
(2) 90% of this partnership is owned by ▇▇▇▇▇ Telecom Inc. (now Adirondacks
LLC) and the remaining 10% is owned by ▇▇▇▇▇ Telecom Investments, Inc.
(3) Of the 2,500 shares issued and outstanding, 2,494 shares are owned by ▇▇▇▇▇
Telecom Inc. (now Adirondacks LLC) and the remaining 6 shares are owned in
name only by ▇▇▇▇▇ employees.
Schedule 5.4
(4) Of the 10,000 shares issued and outstanding, 7,196 shares are owned by
▇▇▇▇▇ Telecom (France) S.A., 4 shares are owned by ▇▇▇▇▇ employees, and
▇▇▇▇▇ Telecom (Netherlands) BV owns the remaining 2,800 shares.
(5) Of the 100,000 shares issued and outstanding 19,800 are owned by ▇▇▇▇▇
Telecom Inc. (now Adirondacks LLC) and 80,200 are owned by ▇▇▇▇▇ Telecom
(Holdings) Pty. Limited.
(6) Of the 1,000 shares issued and outstanding, 999 shares are owned by ▇▇▇▇▇
Telecom Inc. and 1 share is owned by ▇▇▇▇▇ Telecom Investments, Inc.
(7) 95% of the outstanding capital stock of this subsidiary is owned by ▇▇▇▇▇
Telecom Inc. and the remaining 5% is owned by ▇▇▇▇▇ Telecom Investments,
Inc.
(8) 60% of the outstanding capital stock is owned by Mikom G.m.b.H. and the
remaining 40% is owned by the partners of Mikom Vertreibs und Service
G.m.b.H
(9) 98% of the outstanding capital stock of this subsidiary is owned by
Comsearch Holdings, Inc. and the remaining 2% is owned by ▇▇▇▇▇ Telecom
Investments, Inc.
Schedule 5.4
▇▇▇▇▇▇ AFFILIATES OTHER THAN SUBSIDIARIES
▇▇▇▇▇▇ Corporation owns 49% of the share capital of KANKOM, a joint venture
organized under the laws of The Ukraine.
The directors and executive officers of the Company named below may be deemed to
be affiliates.
Schedule 5.4
SUBSIDIARIES AND OWNERSHIP
OF SUBSIDIARY STOCK
OFFICERS OF ▇▇▇▇▇▇ CORPORATION
DIRECTORS:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇ Wm. ▇▇▇▇▇▇▇ * ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇. ▇▇▇▇ *
▇▇▇▇▇ ▇. English ▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
* To be elected Directors on 16 July 2003.
EXECUTIVE OFFICERS:
▇▇▇▇▇ ▇. English Chairman
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ President and CEO
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Vice Chairman and CFO
▇▇▇▇ ▇. ▇▇▇ Group President, Communication Products
▇▇▇▇ ▇. ▇▇▇▇▇▇ Group President, RF Subsystems
▇▇▇▇ ▇. ▇.▇▇▇▇▇▇▇ Vice President, Corporate Marketing and MIS
M. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Vice President; Treasurer
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Vice President, Corporate Development
▇▇▇▇▇ ▇.. ▇▇▇▇▇▇▇▇ Vice President, Strategic Planning
▇▇▇▇ ▇. ▇▇▇▇▇ Vice President, Procurement
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Vice President, Finance, Administration & ▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇ Vice President; Corporate Controller
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Vice President; Secretary
Schedule 5.4
SCHEDULE 5.5
FINANCIAL STATEMENTS
Quarterly Report on Form 10-Q for the Quarterly Period Ended December 31, 2002
Annual Report on Form 10-K for the Fiscal Year Ended September 30, 2002
2002 Annual Report and Fact Book
Joint Proxy Statement/Prospectus dated June 10, 2003
Schedule 5.5
SCHEDULE 5.8
LITIGATION
1. Material pending Lawsuits against ▇▇▇▇▇ Telecom Inc. (now Adirondacks, LLC)
TRUEPOSITION AND KSI, INC. ▇. ▇▇▇▇▇ TELECOM INC.: On December 11, 2001, a
competitor, TruePosition, Inc., and its subsidiary, KSI, Inc., filed a lawsuit
against ▇▇▇▇▇ Telecom Inc. in the United States District Court for the District
of Delaware. The plaintiffs alleged in their complaint that ▇▇▇▇▇ Telecom,
through its ▇▇▇▇▇▇▇ Wireless Division, infringed three patents in connection
with ▇▇▇▇▇'▇ GEOMETRIX wireless geolocation business. On July 16, 2002, the
plaintiffs amended their complaint to add four additional patents to the
lawsuit. ▇▇▇▇▇'▇ answer to the amended complaint denied all the plaintiffs'
allegations and asserted counterclaims against the plaintiffs for infringement
of an ▇▇▇▇▇ patent and for tortious interference with its business
relationships.
In May 2003, the plaintiffs dropped three patents from their case and ▇▇▇▇▇
dropped its infringement counterclaim, thus narrowing the issues. Trial has been
set for 22 September 2003, and ▇▇▇▇▇ intends to defend the case vigorously.
2. Material Threatened Claim against ▇▇▇▇▇▇ Corporation
CLAIM OF ANTEL HOLDINGS LTD: By letter dated November 1, 2002, counsel for Antel
Holdings Ltd. ("Antel") notified ▇▇▇▇▇▇ Corporation of Antel's intention to
pursue certain claims under the indemnity provisions of the Share Purchase and
Sale Agreement pursuant to which Antel purchased Andrew's interests in certain
Russian ventures in December 2001. Antel's letter constituted a formal notice,
which served to preserve its ability to bring an arbitration claim (as required
by the Agreement) in New York under AAA rules. Antel's letter specifies four
claims. Three claims relate to allegedly inflated values of certain
telecommunications assets on the books of the Russian companies sold by ▇▇▇▇▇▇
and the fourth claim relates to the software billing system used by the
companies at the time of their sale. Antel's letter asserts the amount of its
indemnity claim is $23M. Andrew provided formal notice that it disputes the
indemnity claim, through Andrew's attorney's letter of November 25, 2002.
Andrew's defenses include the fact that the purchase price paid by Antel was not
based on asset values, the fact that all specific issues now raised by Antel
were fully disclosed to it during extensive due diligence reviews, and the legal
argument that the damages claimed are in any event grossly overstated. ▇▇▇▇▇▇
intends to dispute the arbitration claim, if and when it is filed.
Schedule 5.8
SCHEDULE 5.11
LICENSES, PERMITS, ETC.
a) None
b) As described in Schedule 5.8, TruePosition alleges that Geolocaton
products sold by the ▇▇▇▇▇▇▇ Division of ▇▇▇▇▇ Telecom violate
certain TruePosition patents.
c) ▇▇▇▇▇▇ Corporation has filed a lawsuit against Kathrein KG of
Germany alleging that certain base-station antenna products sold
by Kathrein infringe various ▇▇▇▇▇▇ patents related to Remote
Electrical Downtilt ("REDT") technology. ▇▇▇▇▇▇ believes this
litigation will be settled on terms favorable to ▇▇▇▇▇▇, after
which ▇▇▇▇▇▇ will pursue license arrangements with, or may
institute litigation against, other sellers of base-station
antennas that infringe Andrew's REDT patents.
Schedule 5.11
SCHEDULE 5.14
USE OF PROCEEDS
No proceeds are being received.
Schedule 5.14
SCHEDULE 5.15
OUTSTANDING INDEBTEDNESS AS OF 3/31/03
Credit Agreement dated December 19, 2002 among ▇▇▇▇▇▇ Corporation, and
Certain Commercial Lending Institutions, led by Bank of America, NA
...........................................................................$ 32,500,000
Senior Notes payable to various insurance companies,
annual installments from 1995 to 2005.....................................$ 13,636,360
Agreement between ▇▇▇▇▇▇ Financial Services and Siemens AG................$ 644,000
6.74% loan from Bank of America Shanghai..................................$ 1,932,000
Floating Rate Industrial Revenue Bonds, to be paid off at closing
...........................................................................$ 11,900,000
Senior Notes payable to various insurance companies,
annual installments from 2003 to 2007.....................................$ 51,167,360
▇▇▇▇▇▇▇ (▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇)...............................................$ 856,000
Forem CMLTD (IMI Loan)....................................................$ 1,617,000
Capital Leases............................................................$ 11,620,000
Letters of Credit.........................................................$ 16,525,000
Other.....................................................................$ 78,000
Schedule 5.15
SCHEDULE 10.2
OUTSTANDING LIENS
None
Schedule 10.2
EXHIBIT 2(a)
[FORM OF SERIES 2003-A NOTE]
▇▇▇▇▇▇ CORPORATION
6.60% Senior Note, Series 2003-A
Due November 14, 2003
No. [________] [Date]
$[__________] PPN: 03442# AA 4
FOR VALUE RECEIVED, the undersigned, ▇▇▇▇▇▇ CORPORATION (herein called
the "Company"), a corporation organized and existing under the laws of the State
of Delaware, promises to pay to [_______________], or registered assigns, the
principal sum of $[ ] on November 14, 2003, 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 6.60% per annum from the date from May 14, 2003, payable
semiannually, on May 14 and November 14 in each year, commencing with the May 14
or November 14 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 Assumption 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) 8.60% or (ii) 2%
over the rate of interest publicly announced by Bank of America National Trust &
Savings Association from time to time in Chicago,
Illinois 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 Bank of America National Trust & Savings
Association in Chicago,
Illinois 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 Assumption Agreement referred to below.
This Note is one of a series of Notes (herein called the "Notes")
issued pursuant to a
Note Assumption and Exchange Agreement, dated as of July
15, 2003 as from time to time amended and supplemented, the "Note Assumption
Agreement"), between 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 Assumption Agreement and (ii) to have made the
representation set forth in Section 6.2 of the Note Assumption Agreement.
This Note is a registered Note and, as provided in the Note Assumption
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
1
Exhibit 2(a)
issued to, and registered in the name of, the transferee. Prior to due
presentment for registration of transfer, the Company may treat the person in
whose name this Note is registered as the owner hereof for the purpose of
receiving payment and for all other purposes, and the Company will not be
affected by any notice to the contrary.
The Company will make required prepayments of principal on the dates
and in the amounts specified in the Note Assumption Agreement. This Note is also
subject to optional prepayment, in whole or from time to time in part, at the
times and on the terms specified in the Note Assumption Agreement but not
otherwise.
If an Event of Default, as defined in the Note Assumption 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
Assumption Agreement.
This Note will be construed and enforced in accordance with, and the
rights of the parties shall be governed by, the law of the State of
Illinois
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.
▇▇▇▇▇▇ CORPORATION
By:
--------------------------------
Title:
-----------------------------
2
Exhibit 2(a)
EXHIBIT 2(b)
[FORM OF SERIES 2003-B NOTE]
▇▇▇▇▇▇ CORPORATION
6.65% Senior Note, Series 2003-B
Due November 14, 2007
No. [________] [Date]
$[__________] PPN: 03442# AB 2
FOR VALUE RECEIVED, the undersigned, ▇▇▇▇▇▇ CORPORATION (herein called
the "Company"), a corporation organized and existing under the laws of the State
of Delaware, promises to pay to [_______________], or registered assigns, the
principal sum of $[ ] on November 14, 2007, 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 6.65% per annum from May 14, 2003, payable semiannually,
on May 14 and November 14 in each year, commencing with the May 14 or November
14 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
Assumption 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) 8.65% or (ii) 2% over the rate of
interest publicly announced by Bank of America National Trust & Savings
Association from time to time in Chicago,
Illinois 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 Bank of America National Trust & Savings
Association in Chicago, Illinois 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 Assumption Agreement referred to below.
This Note is one of a series of Notes (herein called the "Notes")
issued pursuant to a
Note Assumption and Exchange Agreement, dated as of July
15, 2003 as from time to time amended and supplemented, the "Note Assumption
Agreement"), between 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 Assumption Agreement and (ii) to have made the
representation set forth in Section 6.2 of the Note Assumption Agreement.
This Note is a registered Note and, as provided in the Note Assumption
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
1
Exhibit 2(b)
of transfer, the Company may treat the person in whose name this Note is
registered as the owner hereof for the purpose of receiving payment and for all
other purposes, and the Company will not be affected by any notice to the
contrary.
The Company will make required prepayments of principal on the dates
and in the amounts specified in the Note Assumption Agreement. This Note is also
subject to optional prepayment, in whole or from time to time in part, at the
times and on the terms specified in the Note Assumption Agreement but not
otherwise.
If an Event of Default, as defined in the Note Assumption 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
Assumption Agreement.
This Note will be construed and enforced in accordance with, and the
rights of the parties shall be governed by, the law of the State of Illinois
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.
▇▇▇▇▇▇ CORPORATION
By:
--------------------------------
Title:
-----------------------------
2
Exhibit 2(b)
EXHIBIT 2(c)
[FORM OF SERIES 2003-C NOTE]
▇▇▇▇▇▇ CORPORATION
6.74% Senior Note, Series 2003-C
Due November 14, 2007
No. [________] [Date]
$[__________] PPN: 03442# AC 0
FOR VALUE RECEIVED, the undersigned, ▇▇▇▇▇▇ CORPORATION (herein called
the "Company"), a corporation organized and existing under the laws of the State
of Delaware, promises to pay to [_______________], or registered assigns, the
principal sum of $[ ] on November 14, 2007, 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 6.74% per annum from May 14, 2003, payable semiannually,
on May 14 and November 14 in each year, commencing with the May 14 or November
14 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
Assumption 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) 8.74% or (ii) 2% over the rate of
interest publicly announced by Bank of America National Trust & Savings
Association from time to time in Chicago, Illinois 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 Bank of America National Trust & Savings
Association in Chicago, Illinois 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 Assumption Agreement referred to below.
This Note is one of a series of Notes (herein called the "Notes")
issued pursuant to a
Note Assumption and Exchange Agreement, dated as of July
15, 2003 as from time to time amended and supplemented, the "Note Assumption
Agreement"), between 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 Assumption Agreement and (ii) to have made the
representation set forth in Section 6.2 of the Note Assumption Agreement.
This Note is a registered Note and, as provided in the Note Assumption
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
1
Exhibit 2(c)
of transfer, the Company may treat the person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and
for all other purposes, and the Company will not be affected by any notice to
the contrary.
This Note is subject to optional prepayment, in whole or from time to
time in part, at the times and on the terms specified in the Note Assumption
Agreement but not otherwise.
If an Event of Default, as defined in the Note Assumption 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
Assumption Agreement.
This Note will be construed and enforced in accordance with, and the
rights of the parties shall be governed by, the law of the State of Illinois
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.
▇▇▇▇▇▇ CORPORATION
By:
--------------------------------
Title:
-----------------------------
2
Exhibit 2(c)
EXHIBIT 4.4(a)
FORM OF OPINION OF COUNSEL
TO THE COMPANY
July 15, 2003
To the Purchasers Named
On the Attached Schedule I
Ladies and Gentlemen:
We have acted as counsel to ▇▇▇▇▇▇ Corporation ("▇▇▇▇▇▇"), ▇▇▇▇▇▇
Amplifiers, Inc. ("Amplifiers") and Adirondacks, LLC ("Adirondacks" and,
together with ▇▇▇▇▇▇ and Amplifiers, the "Companies"), in connection with the
Note Assumption and Exchange Agreement dated as of July 15, 2003 (the
"Agreement") between ▇▇▇▇▇▇ and ▇▇▇▇▇ Telecom, Inc. ("▇▇▇▇▇") and you. This
opinion is delivered at the Companies' request pursuant to Section 4.4(a) of the
Agreement. Capitalized terms used but not otherwise defined in this opinion have
the meanings ascribed to them in the Agreement.
We have examined executed counterparts of the Agreement and originals of
the Notes. We also have examined originals, executed counterparts or copies,
certified or otherwise identified to our satisfaction, of such documents,
corporate records, certificates of public officials and such other documents as
we have deemed necessary for purposes of this opinion. In this examination, we
have assumed the genuineness of all signatures (other than signatures of
officers of the Companies), the legal capacity of all individuals who have
executed the documents we have reviewed, the authenticity of all documents
submitted to us as originals and the conformity with the originals of all
documents submitted to us as copies. As to matters of fact material to our
opinion, we have relied, without independent verification, on the
representations in the Agreement and the certificates referred to above. Our
examination also extended to such matters of law as we have deemed necessary for
purposes of this opinion. We have assumed that the Agreement has been duly
authorized, executed and delivered by each of the parties thereto (other than
the Companies) and is enforceable in accordance with its terms against such
parties. Our opinion as to the good standing of the Companies and of ▇▇▇▇▇ in
paragraphs 1 and 2 below is based solely upon the certificates of good standing
issued by the Secretaries of State of the States referred to therein.
Whenever our opinion with respect to factual matters is indicated to be
based on our knowledge, we are referring to the actual knowledge of ▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇, the primary lawyer having supervisory responsibility for the
Companies' relationships with this firm, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ and L. ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ III, who are the ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ attorneys who
Exhibit 4.4(a)
have given substantial attention on behalf of the Companies in connection with
this matter. Except as expressly set forth herein, we have not undertaken any
independent investigation to determine the existence or absence of such facts,
and no inference as to our knowledge of the existence or absence of such facts
should be drawn from such representation.
Based upon the foregoing, and subject to the qualifications hereinafter
set forth, we are of the opinion that:
1. Each of ▇▇▇▇▇▇ and ▇▇▇▇▇▇ Amplifiers is a corporation organized
and validly existing in good standing under the laws of the State of Delaware.
Adirondacks is a limited liability company organized and validly existing in
good standing under the laws of the State of Delaware. Each of the Companies has
the requisite corporate or limited liability company power and authority to own
and operate its properties, to carry on its business as now conducted, and, in
the case of ▇▇▇▇▇▇, to enter into and perform the Agreement and to issue and
deliver the Notes in exchange for the Existing Notes.
2. ▇▇▇▇▇▇ is in good standing as a foreign corporation in the State
of Illinois. Amplifiers is in good standing as a foreign corporation in the
State of New Jersey. ▇▇▇▇▇ is in good standing as a foreign corporation in the
State of Ohio.
3. The Agreement and the Notes have been duly authorized by proper
corporate action on the part of ▇▇▇▇▇▇, have been duly executed and delivered by
an authorized officer of ▇▇▇▇▇▇, and constitute the legal, valid and binding
agreements of ▇▇▇▇▇▇, enforceable in accordance with their terms, except to the
extent that enforcement thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws of general application
relating to or affecting the enforcement of the rights of creditors or by
equitable principles, regardless of whether enforcement is sought in a
proceeding in equity or at law.
4. The issuance and delivery of the Notes by ▇▇▇▇▇▇ in exchange for
the Existing Notes do not 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.
5. No authorization, approval or consent of, and no designation,
filing, declaration, registration and/or qualification with, any Governmental
Authority is necessary or required in connection with the execution, delivery
and performance by ▇▇▇▇▇▇ of the Agreement or the issuance and delivery by
▇▇▇▇▇▇ of the Notes in exchange for the Existing Notes.
6. The issuance and delivery of the Notes by ▇▇▇▇▇▇ in exchange for
the existing Notes, the performance of the terms and conditions of the Notes and
the Agreement and the execution and delivery of the Agreement by ▇▇▇▇▇▇ ▇▇ not
conflict with, or result in any breach or violation of any of the provisions of,
or constitute a default under, or result in the creation or imposition of any
Lien on, the property of any of the Companies pursuant to the provisions of (i)
the Certificate of Incorporation, as amended, or By-laws of ▇▇▇▇▇▇, the
Certificate of Incorporation or By-Laws of ▇▇▇▇▇▇ Amplifiers or the Articles of
Organization of Adirondacks, (ii) any loan agreement or evidence of Indebtedness
listed in Schedule 5.15 of the Agreement, (iii) any other agreement or
instrument listed as an exhibit to the Annual Report on Form 10-K of
2
Exhibit 4.4(a)
▇▇▇▇▇▇ for its fiscal year ended September 30, 2002 or to any Quarterly Report
on Form 10-Q or Current Report on Form 8-K filed by ▇▇▇▇▇▇ with the Securities
and Exchange Commission since the date of such Form 10-K, (iv) any law
(including usury laws) or regulation applicable to ▇▇▇▇▇▇ that, in our
experience, is normally applicable both to general business corporations that
are not engaged in regulated business activities and to transactions of the type
contemplated by the Agreement, or (v) any order, writ, injunction or decree
known to us of any court or Federal or Illinois state governmental authority
applicable to any of the Companies.
7. To our knowledge, except as described in Schedule 5.8 to the
Agreement, there are no actions, suits or proceedings pending or threatened in
writing against any of the Companies, at law or in equity or before or by any
Federal or Illinois state governmental authority, that are likely to result,
individually or in the aggregate, in a Material Adverse Effect.
8. Neither ▇▇▇▇▇▇ nor any Subsidiary is an "investment company" or a
company "controlled" by an "investment company," within the meaning of the
Investment Company Act of 1940, as amended.
Our opinion is limited to the laws of the State of Illinois, the General
Corporation Law and Limited Liability Company Law of the State of Delaware and
the Federal laws of the United States.
We express no opinion as to the enforceability of (a) any provision
requiring the payment of interest on interest, (b) express or implicit waivers
of broad or vaguely stated rights, unknown future rights, defenses to
obligations or rights granted by law, where such waivers are against public
policy or prohibited by law, (c) indemnity and contribution rights that may be
against public policy, (d) any provision that provides that waivers, consents,
amendments or modifications must be in writing, or (e) any provision that
provides for reimbursement for attorneys' fees to the extent such attorneys'
fees are not reasonable.
This opinion speaks as of the time of its delivery on the date it bears.
We do not assume any obligation to provide you with any subsequent opinion or
advice by reason of any fact about which we did not have knowledge at that time,
by reason of any change subsequent to that time in any law covered by any of our
opinions, or for any other reason.
This opinion is solely for the benefit of you, your counsel and your
permitted successors and assigns in connection with the transactions
contemplated by the Agreement.
3
Exhibit 4.4(a)
EXHIBIT 4.4(b)
FORM OF TAX OPINION OF COUNSEL
TO THE COMPANY
July 15, 2003
To the Purchasers Named
On the Attached Schedule I
We have acted as counsel to ▇▇▇▇▇▇ Corporation ("▇▇▇▇▇▇"), in connection
with the
Note Assumption and Exchange Agreement (the "Agreement") between ▇▇▇▇▇▇
and ▇▇▇▇▇ Telecom, Inc. ("▇▇▇▇▇") and you dated July 15, 2003. This opinion is
delivered at the Companies request pursuant to Section 4.4(a) of the Agreement.
Capitalized terms used but not otherwise defined in this opinion have the
meanings ascribed to them in the Agreement.
We have examined the proceedings incident to the issuance and exchange of
the Notes for the Existing Notes and, in connection therewith, we have examined
executed counterparts of the Agreement and originals of the Notes. We also have
examined originals, executed counterparts or copies, certified or otherwise
identified to our satisfaction, of such documents, corporate records,
certificates of public officials and such other documents as we have deemed
necessary for purposes of this opinion including without limitation the Merger
Agreement. In this examination, we have assumed the genuineness of all, the
legal capacity of all individuals who have executed the documents we have
reviewed, the authenticity of all documents submitted to us as originals and the
conformity with the originals of all documents submitted to us as copies. As to
matters of fact material to our opinion, we have relied, without independent
verification, on the representations in the Agreement the Merger Agreement
certificates executed with respect to the Merger and the certificates referred
to above. Our examination also extended to such matters of law, as we have
deemed necessary for purposes of this opinion. For purposes of this opinion, we
have assumed that the Agreement has been duly authorized, executed and delivered
by each of the parties there to and is enforceable in accordance with its terms
against such parties. Except as expressly set forth herein, we have not
undertaken any independent investigation to determine the existence or absence
of such facts, and no inference as to our knowledge of the existence or absence
of such facts should be drawn from such representation.
Based upon the foregoing, and subject to the qualifications hereinafter
set forth, we are of the opinion that the Holders of Notes who acquired Existing
Notes for a purchase price of at least par and whose adjusted Tax basis in the
Existing Notes is equal to the price paid for such Existing Notes (excluding
amounts paid for accrued but unpaid interest) less amounts of principal payments
on the Existing Notes received, will not recognize any gain on the
Exhibit 4.4(b)
assumption of the Existing Notes by ▇▇▇▇▇▇, except for any amounts received as
an amendment fee pursuant to Section 4.10 of the Agreement.
This opinion speaks as of the time of its delivery on the date it bears.
We do not assume any obligation to provide you with any subsequent opinion or
advice by reason of any fact about which we did not have knowledge at that time,
by reason of any change subsequent to that time in any law covered by any of our
opinions, or for any other reason.
This opinion is solely for your benefit, in connection with the
transactions contemplated by the Agreement.
2
Exhibit 4.4(b)
EXHIBIT 4.4(c)
FORM OF OPINION OF SPECIAL COUNSEL
TO THE PURCHASERS
The opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇, special counsel to the
Purchasers, shall be to the effect that:
1. The Company is a corporation organized and validly existing in good
standing under the laws of the State of Delaware, with all requisite corporate
power and authority to enter into the Agreement and to issue and sell the Notes.
2. The Agreement and the Notes have been duly authorized by proper
corporate action on the part of the Company, have been duly executed and
delivered by an authorized officer of the Company, and constitute the legal,
valid and binding agreements of the Company, enforceable in accordance with
their terms, except to the extent that enforcement thereof may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws of
general application relating to or affecting the enforcement of the rights of
creditors or by equitable principles, regardless of whether enforcement is
sought in a proceeding in equity or at law.
3. Based upon the representations set forth in the Agreement, the
offering, issuance and delivery of the Notes do not require the registration of
the Notes under the Securities Act of 1933, as amended, nor the qualification of
an indenture under the Trust Indenture Act of 1939, as amended.
4. The issuance of the Notes and compliance with the terms and provisions
of the Notes and the Agreement will not conflict with or result in any breach of
any of the provisions of the Certificate of Incorporation or By-Laws of the
Company.
5. No approval, consent or withholding of objection on the part of, or
filing, registration or qualification with, any governmental body, Federal or
state, is necessary in connection with the execution and delivery of the Note
Agreement or the Notes.
The opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇ also shall state that the opinion of
▇▇▇▇▇▇▇, Carton & ▇▇▇▇▇▇▇, counsel to the Company, delivered to you pursuant to
the Agreement, is satisfactory in form and scope to ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇, and,
in its opinion, the Purchasers and it are justified in relying thereon and shall
cover such other matters relating to the sale of the Notes as the Purchasers may
reasonably request.
Exhibit 4.4(c)