MANOR CARE, INC. Purchase Agreement
Exhibit 99.1
Execution Copy
$400,000,000
MANOR CARE, INC.
2.125% Convertible Senior Notes due 2035
July 26, 2005
▇.▇. ▇▇▇▇▇▇ Securities Inc.
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Ladies and Gentlemen:
Manor Care, Inc., a Delaware corporation (the “Company”), proposes to issue and sell (the
“Offering”) $400,000,000 aggregate principal amount of its 2.125% Convertible Senior Notes due 2035
(the “Securities”) to the several parties named in Schedule 4 hereto (the “Initial Purchasers”).
The Securities will be issued pursuant to an Indenture to be dated as of August 1 , 2005
(the “Indenture”) among the Company, each of the subsidiaries of the Company listed on Schedule 1
hereto (each a “Guarantor” and together the “Guarantors”) and Wachovia Bank, National Association,
as trustee (the “Trustee”). The Securities will be convertible into shares of Common Stock of the
Company at the conversion price set forth in the Indenture. The Securities will be guaranteed by
guarantees (the “Guarantees”, and each a “Guarantee”) of each of the Guarantors. The Company and
the Guarantors hereby confirm their agreement with the Initial Purchasers concerning the purchase
of the Securities from the Company by the several Initial Purchasers.
The Securities will be offered and sold to the Initial Purchasers without being registered
under the Securities Act of 1933, as amended (the “Securities Act”), in reliance upon an exemption
therefrom. The Company has prepared a preliminary offering memorandum dated July 25, 2005
(including the documents incorporated by reference therein, the “Preliminary Offering Memorandum”)
and will prepare an offering memorandum dated the date hereof (including the documents incorporated
by reference therein, the “Offering Memorandum”) setting forth information concerning the Company
and the Securities. Copies of the Preliminary Offering Memorandum have been, and copies of the
Offering Memorandum will be, delivered by the Company to the Initial Purchasers pursuant to the
terms of this Agreement. Any references herein to the Preliminary Offering Memorandum and the
Offering Memorandum shall be deemed to include all amendments and supplements thereto, unless
otherwise noted. The Company hereby confirms that it has authorized the use of the Preliminary
Offering
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Memorandum and the Offering Memorandum in connection with the offering and resale of the
Securities by the Initial Purchasers in accordance with Section 2.
Holders of the Securities (including the Initial Purchasers and their direct and indirect
transferees) will be entitled to the benefits of a Registration Rights Agreement, substantially in
the form attached hereto as Annex A (the “Registration Rights Agreement”), to be dated as of the
Closing Date, among the Company, the Guarantors and the Initial Purchasers, pursuant to which the
Company and the Guarantors will agree to file with the Securities and Exchange Commission (the
“Commission”) a registration statement under the Securities Act (the “Shelf Registration
Statement”) pursuant to which the Company and the Guarantors will register the resale of the
Securities, including the Guarantees of the Guarantors, and the Common Stock issuable upon
conversion thereof under the Act subject to the terms and conditions therein specified.
Capitalized terms used but not defined herein shall have the meanings given to such terms in
the Offering Memorandum.
1. Representations, Warranties and Agreements of the Company and each of the
Guarantors. The Company and the Guarantors jointly and severally represent and warrant to, and
agree with, the several Initial Purchasers on and as of the date hereof and the Closing Date (as
defined in Section 3) that:
(a) Each of the Preliminary Offering Memorandum and the Offering Memorandum, as of its
respective date, did not, and on the Closing Date the Offering Memorandum will not, contain
any untrue statement of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that the Company
and each Guarantor make no representation or warranty as to information contained in or
omitted from the Preliminary Offering Memorandum or the Offering Memorandum in reliance upon
and in conformity with written information relating to the Initial Purchasers furnished to
the Company or the Guarantors by or on behalf of any Initial Purchaser specifically for use
therein as specified in Section 16 hereof (the “Initial Purchasers’ Information”).
(b) The documents incorporated by reference in the Preliminary Offering Memorandum and
the Offering Memorandum, when they were filed with the Commission, conformed in all material
respects to the requirements of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”) and none of such documents contained an untrue statement of a material fact
or omitted to state a material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading; and any further documents
so filed and incorporated by reference in the Preliminary Offering Memorandum and the
Offering Memorandum, when such documents are filed with the Commission, will conform in all
material respects to the requirements of the Exchange Act, and will not contain an untrue
statement of a material fact or
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omit to state a material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
(c) Each of the Preliminary Offering Memorandum and the Offering Memorandum, as of its
respective date, contains all of the information that, if requested by a prospective
purchaser of the Securities, would be required to be provided to such prospective purchaser
pursuant to Rule 144A(d)(4) under the Securities Act.
(d) Assuming the accuracy of the representations and warranties of the Initial
Purchasers contained in Section 2 and their compliance with the agreements set forth
therein, it is not necessary, in connection with the issuance and sale of the Securities to
the Initial Purchasers and the offer, resale and delivery of the Securities by the Initial
Purchasers in the manner contemplated by this Agreement and the Offering Memorandum, to
register the Securities or the Common Stock issuable upon conversion thereof under the
Securities Act or to qualify the Indenture under the Trust Indenture Act of 1939, as amended
(the “Trust Indenture Act”) other than pursuant to the obligations set forth in the
Registration Rights Agreement.
(e) The Company and each of its subsidiaries have been duly incorporated or formed, as
the case may be, and are validly existing corporations or limited liability companies, as
the case may be, in good standing under the laws of their respective jurisdictions of
incorporation or formation as the case may be, are duly qualified to do business and are in
good standing as foreign corporations or foreign limited liability companies, as the case
may be, in each jurisdiction in which their respective ownership or lease of property or the
conduct of their respective businesses requires such qualification, and have all power and
authority necessary to own or hold their respective properties and to conduct the businesses
in which they are engaged, except where the failure to so qualify or have such power or
authority would not, singularly or in the aggregate, reasonably be expected to result in a
material adverse effect on the condition (financial or otherwise), results of operations or
business or prospects of the Company and its subsidiaries taken as a whole (a “Material
Adverse Effect”). Schedule 2 sets forth all of the direct and indirect subsidiaries of the
Company.
(f) Except as noted on Schedule 2, all the outstanding shares of capital stock or
membership interests, as the case may be, of each subsidiary of the Company have been duly
and validly authorized and issued, are fully paid and non-assessable and are owned directly
or indirectly by the Company, free and clear of any lien, charge, encumbrance, security
interest, restriction upon voting or transfer or any other claim of any third party.
(g) The Company and each of the Guarantors has full right and authority to execute and
deliver this Agreement, the Indenture (including the Guarantees set forth therein), the
Registration Rights Agreement, the Securities
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(in the case of the Company only) and the Guarantees (in the case of the Guarantors
only) (collectively, the “Transaction Documents”) and to perform their respective
obligations hereunder and thereunder; and, as of the Closing Date, all corporate or limited
liability company action required to be taken for the due and proper authorization,
execution and delivery of each of the Transaction Documents and the consummation of the
transactions contemplated thereby will have been duly and validly taken.
(h) This Agreement has been duly authorized, executed and delivered by the Company and
each of the Guarantors and constitutes a valid and legally binding agreement of the Company
and each of the Guarantors, except as rights to indemnification and contribution may be
limited by public policy considerations or applicable law.
(i) The Registration Rights Agreement has been duly authorized by the Company and each
of the Guarantors and, when duly executed and delivered in accordance with its terms by each
of the parties thereto, will constitute a valid and legally binding agreement of the Company
and each of the Guarantors enforceable against the Company and each of the Guarantors in
accordance with its terms, except to the extent that such enforceability may be limited by
applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
other similar laws affecting creditors’ rights generally and by general equitable principles
(whether considered in a proceeding in equity or at law).
(j) The Indenture has been duly authorized by the Company and each of the Guarantors
and, when duly executed and delivered in accordance with its terms by each of the parties
thereto, will constitute a valid and legally binding agreement of the Company and each of
the Guarantors enforceable against the Company and each of the Guarantors in accordance with
its terms, except to the extent that such enforceability may be limited by applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar
laws affecting creditors’ rights generally and by general equitable principles (whether
considered in a proceeding in equity or at law). On the Closing Date, the Indenture will
conform in all material respects to the requirements of the Trust Indenture Act and the
rules and regulations of the Commission applicable to an indenture that is qualified
thereunder.
(k) The Securities have been duly authorized by the Company and, when duly executed,
authenticated, issued and delivered as provided in the Indenture (assuming the Indenture is
the valid and legally binding obligation of the Trustee and due authentication of the
Securities by the Trustee) and paid for as provided herein, will be duly and validly issued
and outstanding and will constitute valid and legally binding obligations of the Company, as
issuer, and each of the Guarantors, as guarantors, entitled to the benefits of the Indenture
and enforceable against the Company, as issuer, and each of the Guarantors, as guarantors,
in accordance with their terms, except to the extent that such
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enforceability may be limited by applicable bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws affecting creditors’ rights
generally and by general equitable principles (whether considered in a proceeding in equity
or at law); the Securities will be convertible into Common Stock in accordance with their
terms and the terms of the Indenture.
(l) The Company has an authorized capitalization as set forth in the Offering
Memorandum under the heading “Capitalization” in the Offering Memorandum, and the capital
stock of the Company conforms in all material respects to the description thereof contained
in the Offering Memorandum; the outstanding shares of Common Stock have been duly and
validly authorized and issued and are fully paid and non-assessable; the shares of Common
Stock initially issuable upon conversion of the Securities have been duly and validly
authorized and, when issued upon conversion against payment of the conversion price and in
accordance with the terms of the Indenture, will be validly issued, fully paid and
nonassessable; the Board of Directors of the Company has duly and validly adopted
resolutions reserving such shares of Common Stock for issuance upon conversion; the holders
of the outstanding shares of capital stock of the Company are not entitled to any preemptive
or other rights to subscribe for the Securities or the shares of Common Stock issuable upon
conversion thereof; and, except as set forth in the Offering Memorandum, no options,
warrants or other rights to purchase, agreements or other obligations to issue, or rights to
convert any obligations into or exchange any securities for, shares of capital stock of or
ownership interests in the Company are outstanding.
(m) Each of the Guarantors that, as of the date of the Guarantees, is a guarantor of
the $100,000,000 of 2.125% Convertible Senior Notes due 2023, $200,000,000 of 6.25% Senior
Notes due 2013, $100,000,000 of 71/2% Senior Notes due 2006 issued by Manor Care of America,
Inc. and the $150,000,000 of 8% Senior Notes due 2008 issued by Manor Care, Inc. is also a
Guarantor of the Securities. Schedule 3 attached hereto sets forth all the Significant
Subsidiaries of the Company (as within the meaning of Rule 1-02 under Regulation S-X
promulgated by the Commission) and each such Significant Subsidiary is a Guarantor of the
Securities. The Guarantees have been duly authorized by each of the Guarantors and, when
the Securities have been duly executed, authenticated, issued and delivered as provided in
the Indenture and paid for as provided herein (assuming due authorization, execution and
delivery of the Indenture by the Trustee and due authentication of the Securities by the
Trustee), will constitute valid and legally binding obligations of each of the Guarantors,
enforceable against the Guarantors in accordance with their terms, subject to bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws
affecting creditors’ rights generally and to general equitable principles (whether
considered in a proceeding in equity or at law).
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(n) Each of the Indenture and the Registration Rights Agreement conforms in all
material respects to the description thereof contained in the Offering Memorandum.
(o) The execution, delivery and performance by the Company and each of the Guarantors
of each of the Transaction Documents to which it is a party, the issuance, authentication,
sale and delivery of the Securities and Common Stock upon conversion thereof and compliance
by the Company and each of the Guarantors with the terms thereof and the consummation of the
transactions contemplated by the Transaction Documents, including the use of proceeds
therewith as described in the Offering Memorandum, will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a default under, or
result in the creation or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any of its subsidiaries pursuant to, any material indenture,
mortgage, deed of trust, loan agreement or other material agreement or instrument to which
the Company or any of its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the Company or any of its
subsidiaries is subject, nor will such actions result in any violation of the provisions of
the charter or by-laws (or any other comparable organizational documents) of the Company or
any of its subsidiaries or any statute or any judgment, order, decree, rule or regulation of
any court or arbitrator or governmental agency or body having jurisdiction over the Company
or any of its subsidiaries or any of their properties or assets; and no consent, approval,
authorization or order of, or filing or registration with, any such court or arbitrator or
governmental agency or body under any such statute, judgment, order, decree, rule or
regulation is required for the execution, delivery and performance by the Company and each
of the Guarantors of each of the Transaction Documents to which each is a party, the
issuance, authentication, sale and delivery of the Securities or Common Stock upon
conversion thereof, the issuance of the Guarantees and compliance by the Company and each of
the Guarantors with the terms thereof and the consummation of the transactions contemplated
by the Transaction Documents, including the use of proceeds therewith as described in the
Offering Memorandum, except for such consents, approvals, authorizations, filings,
registrations or qualifications which shall have been obtained or made prior to the Closing
Date and as may be required to be obtained or made under the Securities Act and applicable
state securities laws as provided in the Registration Rights Agreement.
(p) Ernst & Young LLP are independent certified public accountants with respect to the
Company and its subsidiaries (i) as required by the Securities Act and the rules and
regulations of the Commission thereunder and (ii) within the meaning of Rule 101 of the Code
of Professional Conduct of the American Institute of Certified Public Accountants (“AICPA”)
and its interpretations and rulings thereunder. The historical financial statements
(including the related notes) contained or incorporated by reference in the Offering
Memorandum comply as to form in all material respects with the requirements applicable to a
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registration statement on Form S-1 under the Securities Act (except that certain
supporting schedules are omitted); such financial statements have been prepared in
accordance with generally accepted accounting principles consistently applied throughout the
periods covered thereby and fairly present the financial position of the entities purported
to be covered thereby at the respective dates indicated and the results of their operations
and their cash flows for the respective periods indicated; and the financial information
contained in the Offering Memorandum under the headings “Offering memorandum summary—Summary
consolidated financial and operating data” and “Capitalization” are derived from the
accounting records of the Company and its subsidiaries and fairly present the information
purported to be shown thereby. The as adjusted financial information contained in the
Offering Memorandum has been prepared on a basis consistent with the historical financial
statements contained in the Offering Memorandum (except for the adjustments specified
therein). The other historical financial and statistical information and data included or
incorporated by reference in the Offering Memorandum are, in all material respects,
accurately presented and prepared on a basis consistent with such financial statements and
the books and records of the Company.
(q) Except as otherwise disclosed in the Offering Memorandum, there are no legal or
governmental proceedings pending to which the Company or any of its subsidiaries is a party
or of which any property or assets of the Company or any of its subsidiaries is the subject
which, singularly or in the aggregate, if determined adversely to the Company or any of its
subsidiaries, could reasonably be expected to have a Material Adverse Effect, and to the
best knowledge of the Company, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others.
(r) No action has been taken and no statute, rule, regulation or order has been
enacted, adopted or issued by any governmental agency or body which prevents the issuance of
the Securities or the issuance of Common Stock upon conversion of the Securities or the
issuance of the Guarantees or suspends the sale of the Securities in any jurisdiction; no
injunction, restraining order or order of any nature by any federal or state court of
competent jurisdiction has been issued with respect to the Company or any of its
subsidiaries which would prevent or suspend the issuance or sale of the Securities or the
issuance of the Common Stock upon conversion of the Securities or the issuance of the
Guarantees or the use of the Preliminary Offering Memorandum or the Offering Memorandum in
any jurisdiction; no action, suit or proceeding is pending against or, to the best knowledge
of the Company, threatened against or affecting the Company or any of its subsidiaries
before any court or arbitrator or any governmental agency, body or official, domestic or
foreign, which could reasonably be expected to interfere with or adversely affect the
issuance of the Securities or the issuance of the Common Stock upon the conversion of the
Securities or the issuance of the Guarantees or in any manner draw into question the
validity or enforceability of any of the Transaction Documents or any action taken or to be
taken pursuant thereto; and the Company has complied with any
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and all requests by any securities authority in any jurisdiction for additional
information to be included in the Preliminary Offering Memorandum and the Offering
Memorandum.
(s) Neither the Company nor any of its subsidiaries is (i) in violation of its charter
or by-laws (or other comparable organizational documents), (ii) in default, and no event has
occurred which, with notice or lapse of time or both, would constitute such a default, in
the due performance or observance of any term, covenant or condition contained in any
indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which
it is a party or by which it is bound or to which any of its property or assets is subject,
which, singularly or in the aggregate, could reasonably be expected to have a Material
Adverse Effect, or (iii) in violation of any law, ordinance, governmental rule, regulation
or court decree to which it or its property or assets may be subject which, singularly or in
the aggregate, could reasonably be expected to have a Material Adverse Effect.
(t) The Company and each of its subsidiaries possess all material licenses,
certificates, authorizations and permits issued by, and have made all declarations and
filings with, the appropriate federal, state or foreign regulatory agencies or bodies which
are necessary for the ownership of their respective properties or the conduct of their
respective businesses as described in the Offering Memorandum, except where the failure to
possess or make the same would not, singularly or in the aggregate, have a Material Adverse
Effect, and neither the Company nor any of its subsidiaries has received notification of any
revocation or modification of any such license, certificate, authorization or permit, which
singularly or in the aggregate, could reasonably be expected to have a Material Adverse
Effect, or has any reason to believe that any such license, certificate, authorization or
permit will not be renewed in the ordinary course.
(u) The Company and each of its subsidiaries have filed all material federal, state,
local and foreign income and franchise tax returns required to be filed through the date
hereof and have paid all taxes due and owing thereon, other than those being contested in
good faith and for which adequate reserves have been provided. No tax deficiency has been
determined adversely to the Company or any of its subsidiaries which has had (nor does the
Company or any of its subsidiaries have any knowledge of any tax deficiency which, if
determined adversely to the Company or any of its subsidiaries, could reasonably be expected
to have) a Material Adverse Effect, except those deficiencies for which adequate reserves
have been established.
(v) Neither the Company nor any of its subsidiaries is an “investment company” or a
company “controlled by” an investment company within the meaning of the Investment Company
Act of 1940, as amended (the “Investment Company Act”), and the rules and regulations of the
Commission thereunder.
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(w) The Company and each of its subsidiaries maintain a system of internal accounting
controls sufficient to provide reasonable assurance that (i) transactions are executed in
accordance with management’s general or specific authorizations; (ii) transactions are
recorded as necessary to permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain asset accountability; (iii) access
to assets is permitted only in accordance with management’s general or specific
authorization; and (iv) the recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with respect to any
differences.
(x) The Company and each of its subsidiaries have insurance covering their respective
properties, operations, personnel and businesses, as are consistent with industry practice
to protect the Company and its subsidiaries and their respective businesses. Neither the
Company nor any of its subsidiaries has received notice from any insurer or agent of such
insurer that capital improvements or other expenditures are required or necessary to be made
in order to continue such insurance.
(y) The Company and each of its subsidiaries own or possess adequate rights to use all
material patents, patent applications, trademarks, service marks, trade names, trademark
registrations, service ▇▇▇▇ registrations, copyrights, licenses and know-how (including
trade secrets and other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures) presently employed by them in connection with the
respective businesses now operated by them; and the use of such rights in connection with
their respective businesses will not conflict in any material respect with, and the Company
and its subsidiaries have not received any notice of any claim of conflict with, any such
rights of others, except such conflicts which, singularly or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect.
(z) The Company and each of its subsidiaries have good and marketable title in fee
simple to, or have valid rights to lease or otherwise use, all items of real and personal
property which are material to the business of the Company and its subsidiaries, in each
case free and clear of all liens, encumbrances, claims and defects and imperfections of
title except such as do not materially interfere with the use made and proposed to be made
of such property by the Company and its subsidiaries or could not reasonably be expected to
have a Material Adverse Effect, except with respect to secured debt described in the
Offering Memorandum.
(aa) Except for those that could not reasonably be expected to have a Material Adverse
Effect, no labor disturbance by or dispute with the employees of the Company or any of its
subsidiaries exists or, to the best knowledge of the Company, is contemplated or threatened.
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(bb) Except to the extent such events could not reasonably be expected to have a
Material Adverse Effect, no “prohibited transaction” (as defined in Section 406 of the
Employee Retirement Income Security Act of 1974, as amended, including the regulations and
published interpretations thereunder (“ERISA”), or Section 4975 of the Internal Revenue Code
of 1986, as amended from time to time (the “Code”)) or “accumulated funding deficiency” (as
defined in Section 302 of ERISA) or any of the events set forth in Section 4043(b) of ERISA
(other than events with respect to which the 30-day notice requirement under Section 4043 of
ERISA has been waived) has occurred with respect to any employee benefit plan of the Company
or any of its subsidiaries; each such employee benefit plan is in compliance with applicable
law, including ERISA and the Code; the Company and each of its subsidiaries have not
incurred and do not expect to incur liability under Title IV of ERISA with respect to the
termination of, or withdrawal from, any pension plan for which the Company or any of its
subsidiaries would have any liability; and each such pension plan that is intended to be
qualified under Section 401(a) of the Code is so qualified and nothing has occurred, whether
by action or by failure to act, which could cause the loss of such qualification.
(cc) Except as described in the Offering Memorandum, there has been no storage,
generation, transportation, handling, treatment, disposal, discharge, emission or other
release of any kind of toxic or other wastes or other hazardous substances by, due to or
caused by the Company or any of its subsidiaries (or, to the best knowledge of the Company,
any other entity (including any predecessor) for whose acts or omissions the Company or any
of its subsidiaries is or could reasonably be expected to be liable) upon any of the
property now or previously owned or leased by the Company or any of its subsidiaries, or
upon any other property, in violation of any statute or any ordinance, rule, regulation,
order, judgment, decree or permit or which would, under any statute or any ordinance, rule
(including rule of common law), regulation, order, judgment, decree or permit, give rise to
any liability, except for any violation or liability that could not reasonably be expected
to have, singularly or in the aggregate with all such violations and liabilities, a Material
Adverse Effect; and there has been no disposal, discharge, emission or other release of any
kind onto such property or into the environment surrounding such property of any toxic or
other wastes or other hazardous substances with respect to which the Company or any of its
subsidiaries has any knowledge, except for any such disposal, discharge, emission or other
release of any kind which could not reasonably be expected to have, singularly or in the
aggregate with all such discharges and other releases, a Material Adverse Effect.
(dd) On and immediately after the Closing Date, the Company and each of the Guarantors
(after giving effect to the issuance of the Securities and to the other transactions related
thereto as described in the Offering Memorandum) will be Solvent. As used in this
paragraph, the term “Solvent” means, with respect to a particular date, that on such date
the present fair market value (or present fair saleable value) of the assets of the Company
or such Guarantor, as the case
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may be, is not less than the total amount required to pay the probable liabilities of
the Company or such Guarantor on its total existing debts and liabilities (including
contingent liabilities) as they become absolute and matured, the Company or such Guarantor
is able to realize upon its assets and pay its debts and other liabilities, contingent
obligations and commitments as they mature and become due in the normal course of business,
assuming the sale of the Securities as contemplated by this Agreement and the Offering
Memorandum, the Company or such Guarantor is not incurring debts or liabilities beyond its
ability to pay as such debts and liabilities mature and the Company or such Guarantor is not
engaged in any business or transaction, and is not about to engage in any business or
transaction, for which its property would constitute unreasonably small capital after giving
due consideration to the prevailing practice in the industry in which the Company or such
Guarantor is engaged. In computing the amount of such contingent liabilities at any time,
it is intended that such liabilities will be computed at the amount that, in the light of
all the facts and circumstances existing at such time, represents the amount that can
reasonably be expected to become an actual or matured liability.
(ee) Except as described in the Offering Memorandum, there are no outstanding
subscriptions, rights, warrants, calls or options to acquire, or instruments convertible
into or exchangeable for, or agreements or understandings with respect to the sale or
issuance of, any shares of capital stock of or other equity or other ownership interest in
the Company or any of its subsidiaries.
(ff) Neither the Company nor any of its subsidiaries or agents has taken, and none of
them will take, any action that might cause this Agreement or the issuance and sale of the
Securities or the issuance of the Common Stock upon conversion of the Securities or the
issuance of the Guarantees to violate Regulation T, U or X of the Board of Governors of the
Federal Reserve System.
(gg) Neither the Company nor any of its subsidiaries is a party to any contract,
agreement or understanding with any person that would give rise to a valid claim against the
Company or the Initial Purchasers for a brokerage commission, finder’s fee or like payment
in connection with the offering and sale of the Securities.
(hh) The Securities satisfy the eligibility requirements of Rule 144A(d)(3) under the
Securities Act.
(ii) Exclusive of the Initial Purchasers, neither the Company nor any of its affiliates
has, directly or through any agent, sold, offered for sale, solicited offers to buy or
otherwise negotiated in respect of, any security (as such term is defined in the Securities
Act), which is or will be integrated with the sale of the Securities in a manner that would
require registration of the Securities under the Securities Act.
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(jj) None of the Company or any of its affiliates or any other person acting on its or
their behalf has engaged, in connection with the offering of the Securities, in any form of
general solicitation or general advertising within the meaning of Rule 502(c) under the
Securities Act.
(kk) No forward-looking statement (within the meaning of Section 27A of the Securities
Act and Section 21E of the Exchange Act) contained in the Preliminary Offering Memorandum or
the Offering Memorandum has been made or reaffirmed without a reasonable basis or has been
disclosed other than in good faith.
(ll) Since the date as of which information is given in the Offering Memorandum
(exclusive of amendments or supplements after the date hereof), except as otherwise stated
therein, (i) there has been no material adverse change or any development involving a
prospective material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs, management or business prospects of the Company, whether or not
arising in the ordinary course of business, (ii) none of the Company or any of its
subsidiaries has incurred any material liability or obligation, direct or contingent, other
than in the ordinary course of business, (iii) none of the Company or any of its
subsidiaries has entered into any material transaction other than in the ordinary course of
business, (iv) there has not been any change in the capital stock or long-term debt of the
Company or any of its subsidiaries, or any dividend or distribution of any kind declared,
paid or made by the Company or any of its subsidiaries on any class of its capital stock, or
any redemption in respect thereof and (v) neither the Company nor any of its subsidiaries
has sustained any material loss or interference with its business from fire, explosion,
flood or other calamity, in each case not covered by insurance, or from any labor
disturbance or dispute, except in each case as otherwise disclosed in the Preliminary
Offering Memorandum and the Offering Memorandum.
(mm) No Guarantor is currently prohibited, directly or indirectly, under any agreement
or other instrument to which it is a party or is subject, from paying any dividends to the
Company, from making any other distribution on such Guarantor’s capital stock, from repaying
to the Company any loans or advances to such Guarantor from the Company or from transferring
any of such Guarantor’s properties or assets to the Company or any other subsidiary of the
Company.
(nn) Nothing has come to the attention of the Company that has caused the Company to
believe that the statistical and market-related data included in the Preliminary Offering
Memorandum and the Offering Memorandum is not based on or derived from sources that are
reliable and accurate in all material respects.
2. Purchase and Resale of the Securities. (a) On the basis of the representations,
warranties and agreements contained herein, and subject to the terms
13
and conditions set forth herein, the Company agrees to issue and sell to each of the Initial
Purchasers, severally and not jointly, and each of the Initial Purchasers, severally and not
jointly, agrees to purchase from the Company, the principal amount of Securities set forth opposite
the name of such Initial Purchaser on Schedule 4 hereto at a purchase price equal to 98.00% of the
principal amount thereof. The Company shall not be obligated to deliver any of the Securities
except upon payment for all of the Securities to be purchased as provided herein.
(b) The Company acknowledges and agrees that the Initial Purchasers are acting solely in the
capacity of an arm’s length contractual counterparty to the Company with respect to the offering of
Securities and the shares of Common Stock issuable upon conversion thereof contemplated hereby
(including in connection with determining the terms of the offering) and not as a financial advisor
or a fiduciary to, or an agent of, the Company or any other person. Additionally, no Initial
Purchaser is advising the Company or any other person as to any legal, tax, investment, accounting
or regulatory matters in any jurisdiction. The Company shall consult with its own advisors
concerning such matters and shall be responsible for making their own independent investigation and
appraisal of the transactions contemplated hereby, and the Initial Purchasers shall have no
responsibility or liability to the Company with respect thereto. Any review by the Initial
Purchasers of the Company, the transactions contemplated hereby or other matters relating to such
transactions will be performed solely for the benefit of the Initial Purchasers and shall not be on
behalf of the Company; notwithstanding the foregoing, each Initial Purchaser acknowledges solely
for the purposes of compliance with Regulation FD that it is and has been acting as a person who
owes a duty of trust or confidence to the Company as described in Rule 100(b)(2)(i) of Regulation
FD promulgated under the Securities Act.
(c) The Initial Purchasers have advised the Company that they propose to offer the Securities
for resale upon the terms and subject to the conditions set forth herein and in the Offering
Memorandum. Each Initial Purchaser, severally and not jointly, represents, warrants to and agrees
with the Company that (i) it is purchasing the Securities pursuant to an exemption from
registration under the Securities Act, (ii) it has not solicited offers for, or offered or sold,
and will not solicit offers for, or offer or sell, the Securities by means of any form of general
solicitation or general advertising within the meaning of Rule 502(c) of Regulation D under the
Securities Act (“Regulation D”) and (iii) it has solicited and will solicit offers for the
Securities only from, and has offered or sold and will offer, sell or deliver the Securities, as
part of their initial offering, only to persons whom it reasonably believes to be qualified
institutional buyers (“Qualified Institutional Buyers”), as defined in Rule 144A under the
Securities Act (“Rule 144A”), or if any such person is buying for one or more institutional
accounts for which such person is acting as fiduciary or agent, only when such person has
represented to it that each such account is a Qualified Institutional Buyer to whom notice has been
given that such sale or delivery is being made in reliance on Rule 144A.
(d) Each Initial Purchaser, severally and not jointly, represents, warrants and agrees that
(1) it has not offered or sold and prior to the date six months after the Closing Date will not
offer or sell any Securities to persons in the United Kingdom
14
except to persons whose ordinary activities involve them in acquiring, holding, managing or
disposing of investments (as principal or agent) for the purposes of their businesses or otherwise
in circumstances which have not resulted and will not result in an offer to the public in the
United Kingdom within the meaning of the United Kingdom Public Offers of Securities Regulations
1995 (as amended), (2) (i) it is a person whose ordinary activities involve it in acquiring,
holding, managing or disposing of investments (as principal or agent) for the purposes of its
business and (ii) it has not offered or sold and will not offer or sell the Securities other than
to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of
investments (as principal or as agent) for the purposes of their businesses or who it is reasonable
to expect will acquire, hold, manage or dispose of investments (as principal or agent) for the
purposes of their businesses where the issue of the Securities would otherwise constitute a
contravention of Section 19 of the United Kingdom Financial Services and Markets ▇▇▇ ▇▇▇▇ (the
“FSMA”)) by the Company; (3) it has only communicated or caused to be communicated and will only
communicate or cause to be communicated an invitation or inducement to engage in investment
activity (within the meaning of Section 21 of the FSMA) received by it in connection with the issue
or sale of the Notes in circumstances in which Section 21(1) of the FSMA does not apply to the
Company or the Guarantors; and (4) it has complied and will comply with all applicable provisions
of the FSMA with respect to anything done by it in relation to the Securities in, from or otherwise
involving the United Kingdom.
(e) Each Initial Purchaser, severally and not jointly, agrees that, prior to or simultaneously
with the confirmation of sale by such Initial Purchaser to any purchaser of any of the Securities
purchased by such Initial Purchaser from the Company pursuant hereto, such Initial Purchaser shall
furnish to that purchaser a copy of the Offering Memorandum (and any amendment or supplement
thereto that the Company shall have furnished to such Initial Purchaser prior to the date of such
confirmation of sale where required by applicable law). In addition to the foregoing, each Initial
Purchaser acknowledges and agrees that the Company and, for purposes of the opinions to be
delivered to the Initial Purchasers pursuant to Section 5(d), (e) and (g), counsel for the Company
and for the Initial Purchasers, respectively, may rely upon the accuracy of the representations and
warranties of the Initial Purchasers and their compliance with their agreements contained in this
Section 2, and each Initial Purchaser hereby consents to such reliance.
(f) The Company acknowledges and agrees that the Initial Purchasers may sell Securities to any
affiliate of an Initial Purchaser and that any such affiliate may sell Securities purchased by it
to an Initial Purchaser.
3. Delivery of and Payment for the Securities. (a) Delivery of and payment for the
Securities shall be made at the offices of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, New York, New York, or
at such other place as shall be agreed upon by the Initial Purchasers and the Company, at 10:00
A.M., New York City time, on August 1, 2005, or at such other time or date, not later than seven
full business days thereafter, as shall be agreed upon by the Initial Purchasers and the Company
(such date and time of payment and delivery being referred to herein as the “Closing Date”).
15
(b) On the Closing Date, payment of the purchase price for the Securities shall be made to the
Company by wire or book-entry transfer of same-day funds to such account or accounts as the Company
shall specify prior to the Closing Date or by such other means as the parties hereto shall agree
prior to the Closing Date against delivery to the Initial Purchasers of the certificates evidencing
the Securities. Time shall be of the essence, and delivery at the time and place specified
pursuant to this Agreement is a further condition of the obligations of the Initial Purchasers
hereunder. Upon delivery, the Securities shall be in global form, registered in such names and in
such denominations as the Initial Purchasers shall have requested in writing not less than two full
business days prior to the Closing Date. The Company agrees to make one or more global
certificates evidencing the Securities available for inspection by the Initial Purchasers in New
York, New York at least 24 hours prior to the Closing Date.
4. Further Agreements of the Company and each of the Guarantors. Each of the Company
and each of the Guarantors agrees with each of the several Initial Purchasers:
(a) during the period referred to in Section 4(d), to advise the Initial Purchasers
promptly and, if requested, confirm such advice in writing, of the happening of any event
which makes any statement of a material fact made in the Offering Memorandum untrue or which
requires the making of any additions to or changes in the Offering Memorandum (as amended or
supplemented from time to time) in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; to advise the Initial Purchasers
promptly of any order preventing or suspending the use of the Preliminary Offering
Memorandum or the Offering Memorandum, of any suspension of the qualification of the
Securities for offering or sale in any jurisdiction and of the initiation or threatening of
any proceeding for any such purpose; and to use its reasonable best efforts to prevent the
issuance of any such order preventing or suspending the use of the Preliminary Offering
Memorandum or the Offering Memorandum or suspending any such qualification and, if any such
suspension is issued, to obtain the lifting thereof at the earliest possible time;
(b) to furnish promptly to each of the Initial Purchasers and counsel for the Initial
Purchasers, without charge, as many copies of the Preliminary Offering Memorandum and the
Offering Memorandum (and any amendments or supplements thereto) as may be reasonably
requested;
(c) prior to making any amendment or supplement to the Offering Memorandum, to furnish
a copy thereof to each of the Initial Purchasers and counsel for the Initial Purchasers and
not to effect any such amendment or supplement to which the Initial Purchasers shall
reasonably object by notice to the Company after a reasonable period to review;
(d) if, at any time prior to completion of the resale of the Securities by the Initial
Purchasers, any event shall occur or condition exist as a result of which
16
it is necessary, in the opinion of counsel for the Initial Purchasers or counsel for
the Company, to amend or supplement the Offering Memorandum in order that the Offering
Memorandum will not include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of the
circumstances existing at the time it is delivered to a purchaser, not misleading, or if it
is necessary to amend or supplement the Offering Memorandum to comply with applicable law,
to promptly prepare such amendment or supplement as may be necessary to correct such untrue
statement or omission or so that the Offering Memorandum, as so amended or supplemented,
will comply with applicable law;
(e) for so long as the Securities or Common Stock issued upon conversion thereof are
outstanding and are “restricted securities” within the meaning of Rule 144(a)(3) under the
Securities Act, to furnish to holders of such Securities or Common Stock and prospective
purchasers of such Securities or Common Stock designated by such holders, upon request of
such holders or such prospective purchasers, the information required to be delivered
pursuant to Rule 144A(d)(4) under the Securities Act, unless the Company is then subject to
and in compliance with Section 13 or 15(d) of the Exchange Act (the foregoing agreement
being for the benefit of the holders from time to time of such Securities and Common Stock
and prospective purchasers of such Securities and Common Stock designated by such holders);
(f) for so long as the Securities are outstanding, upon the request of an Initial
Purchaser, to furnish to the Initial Purchasers copies of any annual reports, quarterly
reports and current reports filed by the Company with the Commission on Forms 10-K, 10-Q and
8-K, or such other similar forms as may be designated by the Commission, and such other
documents, reports and information as shall be furnished by the Company to the Trustee or to
the holders of the Securities pursuant to the Indenture or the Exchange Act or any rule or
regulation of the Commission thereunder;
(g) to promptly take from time to time such actions as the Initial Purchasers may
reasonably request to qualify the Securities for offering and sale under the securities or
Blue Sky laws of such jurisdictions as the Initial Purchasers may designate and to continue
such qualifications in effect for so long as required for the resale of the Securities; and
to arrange for the determination of the eligibility for investment of the Securities under
the laws of such jurisdictions as the Initial Purchasers may reasonably request;
provided that the Company and its subsidiaries shall not be obligated to qualify as
foreign corporations or limited liability companies in any jurisdiction in which they are
not so qualified or to file a general consent to service of process in any jurisdiction;
(h) to assist the Initial Purchasers in arranging for the Securities to be designated
as PORTAL securities in accordance with the rules and regulations adopted by the National
Association of Securities Dealers, Inc. (“NASD”) relating
17
to trading in The PORTAL Market and for the Securities to be eligible for clearance and
settlement through The Depository Trust Company (“DTC”);
(i) not to, and to cause its affiliates not to, sell, offer for sale or solicit offers
to buy or otherwise negotiate in respect of any security (as such term is defined in the
Securities Act) which could be integrated with the sale of the Securities in a manner which
would require registration of the Securities under the Securities Act;
(j) except following the effectiveness of the Shelf Registration Statement, not to, and
to cause its affiliates not to, and not to authorize or knowingly permit any person acting
on their behalf to, solicit any offer to buy or offer to sell the Securities by means of any
form of general solicitation or general advertising within the meaning of Regulation D or in
any manner involving a public offering within the meaning of Section 4(2) of the Securities
Act; and not to offer, sell, contract to sell or otherwise dispose of, directly or
indirectly, any securities under circumstances where such offer, sale, contract or
disposition would cause the exemption afforded by Section 4(2) of the Securities Act to
cease to be applicable to the offering and sale of the Securities and the Common Stock
issuable upon conversion thereof as contemplated by this Agreement and the Offering
Memorandum;
(k) The Company will not for a period of 90 days following the date of this Agreement,
without the prior written consent of the Initial Purchasers, offer, sell, contract to sell,
pledge or otherwise dispose of (or enter into any transaction which is designed to, or might
reasonably be expected to, result in the disposition (whether by actual disposition or
effective economic disposition due to cash settlement or otherwise) by the Company or any
Affiliate of the Company or any person in privity with the Company or any Affiliate of the
Company), directly or indirectly, or file (or participate in the filing of) a registration
statement with the Commission in respect of, or establish or increase a put equivalent
position or liquidate or decrease a call equivalent position within the meaning of Section
16 of the Exchange Act and the rules and regulations of the Commission promulgated
thereunder with respect to, any shares of capital stock of the Company or any securities
convertible or exercisable or exchangeable for such capital stock, or publicly announce an
intention to effect any such transaction; provided, however, that (i) the
Company may issue and sell Common Stock, and file related registration statements, pursuant
to any employee stock option plan, stock ownership plan or dividend reinvestment plan of the
Company in effect at the date of this Agreement, (ii) the Company may issue Common Stock
issuable upon the conversion of securities or the exercise of warrants outstanding at the
date of this Agreement, (iii) the Company may issue stock as consideration for purchases or
acquisitions of other businesses or entities, (iv) the Company may file registration
statements in respect of the Securities and shares of Common Stock issuable upon conversion
of the Securities and may issue Common Stock upon conversion of the Securities and (v) the
Company may enter into the hedge
18
and warrant option transactions in connection with the issuance of the Securities as
described in the Offering Memorandum;
(l) during the period from the Closing Date until two years after the Closing Date,
without the prior written consent of the Initial Purchasers, not to, and not permit any of
its affiliates (as defined in Rule 144 under the Securities Act) to, resell any of the
Securities or Common Stock issued upon conversion thereof that have been reacquired by them,
except for Securities and Common Stock issued upon conversion thereof purchased by the
Company or any of its affiliates and resold in a transaction registered under the Securities
Act;
(m) except as described in the Offering Memorandum, in connection with the offering of
the Securities, until the Initial Purchasers shall have notified the Company of the
completion of the resale of the Securities, not to, and to cause its affiliated purchasers
(as defined in Regulation M under the Exchange Act) not to, either alone or with one or more
other persons, bid for or purchase, for any account in which it or any of its affiliated
purchasers has a beneficial interest, any Securities or the Common Stock, or attempt to
induce any person to purchase any Securities or Common Stock; and not to, and to cause its
affiliated purchasers not to, make bids or purchase for the purpose of creating actual, or
apparent active trading in or of raising the price of the Securities or the Common Stock;
(n) between the date hereof and the Closing Date, the Company will not do or authorize
any act or thing that would result in an adjustment of the conversion price of the
Securities;
(o) in connection with the offering of the Securities, to make its officers, employees,
independent accountants and legal counsel reasonably available upon request by the Initial
Purchasers;
(p) to furnish to each of the Initial Purchasers on the date hereof a copy of the
independent accountants’ report included in the Offering Memorandum signed by the
accountants rendering such report;
(q) to do and perform all things required to be done and performed by it under this
Agreement that are within its reasonable control prior to or after the Closing Date, and to
use its reasonable best efforts to satisfy all conditions precedent on its part to the
delivery of the Securities;
(r) to not take any action prior to the execution and delivery of the Indenture which,
if taken after such execution and delivery, would have violated any of the covenants
contained in the Indenture;
(s) to not take any action prior to the Closing Date which would require the Offering
Memorandum to be amended or supplemented pursuant to Section 4(d);
19
(t) prior to the Closing Date, not to issue any press release or other communication
directly or indirectly or hold any press conference with respect to the Company, its
condition, financial or otherwise, or earnings, business affairs or business prospects
(except for routine oral marketing communications in the ordinary course of business and
consistent with the past practices of the Company and of which the Initial Purchasers are
notified), without the prior written consent of the Initial Purchasers, unless in the
judgment of the Company and its counsel, and after notification to the Initial Purchasers,
such press release or communication is required by law;
(u) to reserve and keep available at all times, free of pre-emptive rights, the full
number of shares of Common Stock issuable upon conversion of the Securities;
(v) to apply the net proceeds from the sale of the Securities as set forth in the
Offering Memorandum under the heading “Use of proceeds”; and
(w) Neither the Company nor any of its affiliates has taken, directly or indirectly,
any action designed to or that could reasonably be expected to cause or result in any
stabilization or manipulation of the price of the Securities or the Common Stock and neither
the Company nor any of its affiliates has taken or will take, directly or indirectly, any
action prohibited by Regulation M under the Exchange Act in connection with the offering of
the Securities.
5. Conditions of Initial Purchasers’ Obligations. The respective obligations of the
several Initial Purchasers hereunder are subject to the accuracy, on and as of the date hereof and
the Closing Date, of the representations and warranties of the Company and the Guarantors contained
herein, to the accuracy of the statements of the Company, the Guarantors and each of their
respective officers made in any certificates delivered pursuant hereto, to the performance by the
Company and the Guarantors of their obligations hereunder, and to each of the following additional
terms and conditions:
(a) The Offering Memorandum (and any amendments or supplements thereto) shall have been
printed and copies distributed to the Initial Purchasers as promptly as practicable on or
following the date of this Agreement or at such other date and time as to which the Initial
Purchasers may agree; and no stop order suspending the sale of the Securities in any
jurisdiction shall have been issued and no proceedings for the purpose shall have been
commenced or shall be pending or threatened.
(b) None of the Initial Purchasers shall have discovered and disclosed to the Company
on or prior to the Closing Date that the Offering Memorandum or any amendment or supplement
thereto contains an untrue statement of a fact which, in the opinion of counsel for the
Initial Purchasers, is material or omits to state any fact which, in the opinion of such
counsel is material and is required to be stated therein or is necessary to make the
statements therein not misleading.
20
(c) All corporate or limited liability company proceedings and other legal matters
incident to the authorization, form and validity of each of the Transaction Documents and
the Offering Memorandum, and all other legal matters relating to the Transaction Documents
and the transactions contemplated thereby, shall be satisfactory in all material respects to
the Initial Purchasers, and the Company and each of the Guarantors shall have furnished to
the Initial Purchasers all documents and information that they or their counsel may
reasonably request to enable them to pass upon such matters.
(d) ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP shall have furnished to the Initial Purchasers their written
opinion, as special counsel to the Company and certain of the Guarantors, addressed to the
Initial Purchasers and dated the Closing Date, in form and substance reasonably satisfactory
to the Initial Purchasers, substantially in the form set forth in Annex B-1 hereto.
(e) R. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, General Counsel of the Company, shall have furnished to the
Initial Purchasers his written opinion, addressed to the Initial Purchasers and dated the
Closing Date, in form and substance reasonably satisfactory to the Initial Purchasers,
substantially in the form set forth in Annex B-2 hereto.
(f) ▇▇▇▇ ▇▇▇▇▇ LLP, special regulatory counsel for the Company, shall have furnished to
the Initial Purchasers their written opinion, addressed to the Initial Purchasers and dated
the Closing Date, in form and substance reasonably satisfactory to the Initial Purchasers,
substantially in the form set forth in Annex B-3 hereto.
(g) The Initial Purchasers shall have received from ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP,
counsel for the Initial Purchasers, such opinion or opinions, dated the Closing Date, with
respect to such matters as the Initial Purchasers may reasonably require, and the Company
shall have furnished to such counsel such documents and information as they request for the
purpose of enabling them to pass upon such matters.
(h) ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Green, P.C., special regulatory counsel for the Initial
Purchasers, shall have furnished to the Initial Purchasers their written opinion, addressed
to the Initial Purchasers and dated the Closing Date, in form and substance reasonably
satisfactory to the Initial Purchasers.
(i) The Company shall have furnished to the Initial Purchasers a letter (the “Initial
Letter”) of Ernst & Young LLP, addressed to the Initial Purchasers and dated the date
hereof, in form and substance satisfactory to the Initial Purchasers.
(j) The Company shall have furnished to the Initial Purchasers a letter (the
“Bring-Down Letter”) of Ernst & Young LLP, addressed to the Initial Purchasers and dated the
Closing Date (A) confirming that they are independent
21
public accountants with respect to the Company and its subsidiaries within the meaning
of Rule 101 of the Code of Professional Conduct of the AICPA and its interpretations and
rulings thereunder, (B) stating, as of the date of the Bring-Down Letter (or, with respect
to matters involving changes or developments since the respective dates as of which
specified financial information is given in the Offering Memorandum, as of a date not more
than three business days prior to the date of the Bring-Down Letter), that the conclusions
and findings of such accountants with respect to the financial information and other matters
covered by the Initial Letter are accurate and (C) confirming in all material respects the
conclusions and findings set forth in the Initial Letter.
(k) The Company shall have furnished to the Initial Purchasers a certificate, dated the
Closing Date, of its chief executive officer or its chief financial officer stating that (A)
such officers have carefully examined the Offering Memorandum, (B) in their opinion, the
Offering Memorandum, as of its date, did not include any untrue statement of a material fact
and did not omit to state a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the circumstances under which they
were made, not misleading, and since the date of the Offering Memorandum, no event has
occurred which should have been set forth in a supplement or amendment to the Offering
Memorandum so that the Offering Memorandum (as so amended or supplemented) would not include
any untrue statement of a material fact and would not omit to state a material fact required
to be stated therein or necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading and (C) as of the Closing Date,
the representations and warranties of the Company and each of the Guarantors, as applicable
in this Agreement are true and correct in all material respects, the Company and each of the
Guarantors, as applicable, have complied with all agreements and satisfied all conditions on
its part to be performed or satisfied hereunder on or prior to the Closing Date, and
subsequent to the date of the most recent financial statements contained in the Offering
Memorandum (exclusive of amendments or supplements to the Offering Memorandum after the date
hereof), there has been no material adverse change in the financial position or results of
operation of the Company or any of its subsidiaries, or any change, or any development
including a prospective change, in or affecting the condition (financial or otherwise),
results of operations, business or prospects of the Company and its subsidiaries taken as a
whole, except as set forth in the Offering Memorandum (exclusive of amendments or
supplements after the date hereof).
(l) The Initial Purchasers shall have received a counterpart of the Registration Rights
Agreement that shall have been executed and delivered by a duly authorized officer or agent
of the Company and each of the Guarantors.
(m) The Indenture shall have been duly executed and delivered by the Company, each of
the Guarantors and the Trustee, and the Securities shall have
22
been duly executed and delivered by the Company and duly authenticated by the Trustee.
(n) The Securities shall have been approved by the NASD for trading in The PORTAL
Market and shall be eligible for clearance and settlement through DTC.
(o) The Common Stock issuable upon the conversion of the Securities shall have been
listed on the New York Stock Exchange subject to notice of issuance.
(p) If any event shall have occurred that requires the Company under Section 4(d) to
prepare an amendment or supplement to the Offering Memorandum, such amendment or supplement
shall have been prepared, the Initial Purchasers shall have been given a reasonable
opportunity to comment thereon, and copies thereof shall have been delivered to the Initial
Purchasers reasonably in advance of the Closing Date.
(q) There shall not have occurred any invalidation of Rule 144A under the Securities
Act by any court or any withdrawal or proposed withdrawal of any rule or regulation under
the Securities Act or the Exchange Act by the Commission or any amendment or proposed
amendment thereof by the Commission which in the judgment of the Initial Purchasers would
materially impair the ability of the Initial Purchasers to purchase, hold or effect resales
of the Securities contemplated hereby.
(r) Subsequent to the execution and delivery of this Agreement or, if earlier, the
dates as of which information is given in the Offering Memorandum (exclusive of any
amendment or supplement thereto), there shall not have been any change in the capital stock
or long-term debt or any change, or any development involving a prospective change, in or
affecting the condition (financial or otherwise), results of operations, business or
prospects of the Company and its subsidiaries taken as a whole, the effect of which, in any
such case described above, is, in the judgment of the Initial Purchasers, so material and
adverse as to make it impracticable or inadvisable to proceed with the sale or delivery of
the Securities on the terms and in the manner contemplated by this Agreement and the
Offering Memorandum (exclusive of any amendment or supplement thereto).
(s) No action shall have been taken and no statute, rule, regulation or order shall
have been enacted, adopted or issued by any governmental agency or body which would, as of
the Closing Date, prevent the issuance or sale of the Securities or the issuance of the
Common Stock upon conversion thereof or the issuance of the Guarantees; and no injunction,
restraining order or order of any other nature by any federal or state court of competent
jurisdiction shall have been issued as of the Closing Date which would prevent the issuance
or sale of
23
the Securities or the issuance of the Common Stock upon conversion thereof or the
issuance of the Guarantees.
(t) Subsequent to the execution and delivery of this Agreement, (i) no downgrading
shall have occurred in the rating accorded the Securities or any other debt securities or
preferred stock issued or guaranteed by the Company or any of the Guarantors by any
“nationally recognized statistical rating organization”, as such term is defined by the
Commission for purposes of Rule 436(g)(2) under the Securities Act; and (ii) no such
organization shall have publicly announced that it has under surveillance or review, or has
changed its outlook with respect to, its rating of the Securities or of any other debt
securities or preferred stock issued or guaranteed by the Company or any of the Guarantors
(other than an announcement with positive implications of a possible upgrading).
(u) Subsequent to the execution and delivery of this Agreement there shall not have
occurred any of the following: (i) trading generally shall have been suspended or materially
limited on the New York Stock Exchange or the over-the-counter market; (ii) trading of any
securities issued or guaranteed by the Company or any of the Guarantors shall have been
suspended on any exchange or in any over-the-counter market; (iii) a general moratorium on
commercial banking activities shall have been declared by federal or New York State
authorities or there shall have occurred a material disruption of securities clearance or
settlement systems; or (iv) there shall have occurred any outbreak or escalation of
hostilities or any change in financial markets or any calamity or crisis, either within or
outside the United States, that, in the judgment of the Initial Purchasers, is material and
adverse and makes it impracticable or inadvisable to proceed with the offering, sale or
delivery of the Securities on the terms and in the manner contemplated by this Agreement and
the Offering Memorandum.
(v) The Initial Purchasers shall have received on and as of the Closing Date
satisfactory evidence of the good standing of the Company and its Significant Subsidiaries
in their respective jurisdictions of organization and their good standing in the other
jurisdictions set forth in Schedule 3 hereto, in each case in writing or any standard form
of telecommunication, from the appropriate governmental authorities of such jurisdictions.
(w) The Company shall have furnished to the Initial Purchasers on the date hereof
letters substantially in the form of Annex C hereto from each of the executive officers and
directors of the Company hereto addressed to the Initial Purchasers.
(x) On or prior to the Closing Date, the Company shall have furnished to the Initial
Purchasers such further certificates and documents as they may reasonably request.
24
(y) The conditions to the effectiveness of the convertible note hedge and warrant
option transactions (as defined in the Offering Memorandum) shall have been satisfied.
All opinions, letters, evidence and certificates mentioned above or elsewhere in this
Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form
and substance reasonably satisfactory to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP.
6. Termination. The obligations of the Initial Purchasers hereunder may be terminated
by the Initial Purchasers, in their absolute discretion, by notice given to and received by the
Company prior to delivery of and payment for the Securities if, prior to that time, any of the
events described in Section 5(q), (r), (s), (t) or (u) shall have occurred.
7. Defaulting Initial Purchasers. (a) If, on the Closing Date, any Initial Purchaser
defaults in the performance of its obligations under this Agreement, the non-defaulting Initial
Purchasers may make arrangements for the purchase of the Securities which such defaulting Initial
Purchaser agreed but failed to purchase by other persons satisfactory to the Company and the
non-defaulting Initial Purchasers, but if no such arrangements are made within 36 hours after such
default, this Agreement shall terminate without liability on the part of the non-defaulting Initial
Purchasers, the Company or the Guarantors, except that the Company will continue to be liable for
the payment of expenses to the extent set forth in Sections 8 and 12 and except that the provisions
of Sections 9 and 10 shall not terminate and shall remain in effect. As used in this Agreement,
the term “Initial Purchasers” includes, for all purposes of this Agreement unless the context
otherwise requires, any party not listed in Schedule 4 hereto that, pursuant to this Section 7,
purchases Securities which a defaulting Initial Purchaser agreed but failed to purchase.
(a) Nothing contained herein shall relieve a defaulting Initial Purchaser of any liability it
may have to the Company, the Guarantors or any non-defaulting Initial Purchaser for damages caused
by its default. If other persons are obligated or agree to purchase the Securities of a defaulting
Initial Purchaser, any of the non-defaulting Initial Purchasers or the Company may postpone the
Closing Date for up to seven full business days in order to effect any changes that in the opinion
of counsel for the Company or counsel for the Initial Purchasers may be necessary in the Offering
Memorandum or in any other document or arrangement, and the Company agrees to promptly prepare any
amendment or supplement to the Offering Memorandum that effects any such changes.
8. Reimbursement of Initial Purchasers’ Expenses. If (a) this Agreement shall have
been terminated due to the failure to comply with any of subsection of Section 5 (other than due to
the events described in Section 5(q), (s) or (u) (other than clause (ii) of Section 5(u)), in which
case each party will be responsible for its own expenses) or pursuant to Section 6, (b) the Company
shall fail to tender the Securities for delivery to the Initial Purchasers for any reason or (c)
the Initial
25
Purchasers shall decline to purchase the Securities for any reason permitted under this
Agreement, the Company and each of the Guarantors shall reimburse the Initial Purchasers for such
out-of-pocket expenses (including reasonable fees and disbursements of counsel) as shall have been
reasonably incurred by the Initial Purchasers in connection with this Agreement and the proposed
purchase and resale of the Securities. If this Agreement is terminated pursuant to Section 7 by
reason of the default of one or more of the Initial Purchasers, neither the Company nor the
Guarantors shall be obligated to reimburse any defaulting Initial Purchaser on account of such
expenses.
9. Indemnification. (a) The Company and each of the Guarantors shall jointly and
severally indemnify and hold harmless each Initial Purchaser, its affiliates, their respective
officers, directors, employees, representatives and agents, and each person, if any, who controls
any Initial Purchaser within the meaning of the Securities Act or the Exchange Act (collectively
referred to for purposes of this Section 9(a) and Section 10 as an Initial Purchaser), from and
against any loss, claim, damage or liability, joint or several, or any action in respect thereof
(including, without limitation, any loss, claim, damage, liability or action relating to purchases
and sales of the Securities), to which that Initial Purchaser may become subject, whether commenced
or threatened, under the Securities Act, the Exchange Act, any other federal or state statutory law
or regulation, at common law or otherwise, insofar as such loss, claim, damage, liability or action
arises out of, or is based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained in the Preliminary Offering Memorandum or the Offering Memorandum or in any
amendment or supplement thereto or in any information provided by the Company or any Guarantor
pursuant to Section 4(e) or (ii) the omission or alleged omission to state therein a material fact
required to be stated therein or necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading, and shall reimburse each Initial
Purchaser promptly upon demand for any legal or other expenses reasonably incurred by that Initial
Purchaser in connection with investigating or defending or preparing to defend against or appearing
as a third party witness in connection with any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that the Company and each of the
Guarantors shall not be liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of, or is based upon, an untrue statement or alleged untrue
statement in or omission or alleged omission from any of such documents in reliance upon and in
conformity with any Initial Purchasers’ Information; and provided, further, that
with respect to any such untrue statement in or omission from the Preliminary Offering Memorandum,
the indemnity agreement contained in this Section 9(a) shall not inure to the benefit of any such
Initial Purchaser to the extent that the sale to the person asserting any such loss, claim, damage,
liability or action was an initial resale by such Initial Purchaser and any such loss, claim,
damage, liability or action of or with respect to such Initial Purchaser results from the fact that
both (A) to the extent required by applicable law, a copy of the Offering Memorandum was not sent
or given to such person at or prior to the written confirmation of the sale of such Securities to
such person and (B) the untrue statement in or omission from the Preliminary Offering Memorandum
was corrected in the Offering Memorandum unless, in either case, such
26
failure to deliver the Offering Memorandum was a result of non-compliance by the Company with
Section 4(b).
(b) Each Initial Purchaser, severally and not jointly, shall indemnify and hold harmless the
Company, each Guarantor and their respective officers, directors, employees, representatives and
agents, and each person, if any, who controls the Company within the meaning of the Securities Act
or the Exchange Act (collectively referred to for purposes of this Section 9(b) and Section 10 as
the Company), from and against any loss, claim, damage or liability, joint or several, or any
action in respect thereof, to which the Company may become subject, whether commenced or
threatened, under the Securities Act, the Exchange Act, any other federal or state statutory law or
regulation, at common law or otherwise, insofar as such loss, claim, damage, liability or action
arises out of, or is based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained in the Preliminary Offering Memorandum or the Offering Memorandum or in any
amendment or supplement thereto or (ii) the omission or alleged omission to state therein a
material fact required to be stated therein or necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading, but in each case only
to the extent that the untrue statement or alleged untrue statement or omission or alleged omission
was made in reliance upon and in conformity with any Initial Purchasers’ Information provided by
such Initial Purchaser, and shall reimburse the Company for any legal or other expenses reasonably
incurred by the Company in connection with investigating or defending or preparing to defend
against or appearing as a third party witness in connection with any such loss, claim, damage,
liability or action as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under this Section 9 of notice of any claim
or the commencement of any action, the indemnified party shall, if a claim in respect thereof is to
be made against the indemnifying party pursuant to Section 9(a) or 9(b), notify the indemnifying
party in writing of the claim or the commencement of that action; provided,
however, that the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 9 except to the extent that it has been materially
prejudiced (through the forfeiture of substantive rights or defenses) by such failure; and,
provided, further, that the failure to notify the indemnifying party shall not
relieve it from any liability which it may have to an indemnified party otherwise than under this
Section 9. If any such claim or action shall be brought against an indemnified party, and it shall
notify the indemnifying party thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it wishes, jointly with any other similarly notified indemnifying
party, to assume the defense thereof with counsel reasonably satisfactory to the indemnified party.
After notice from the indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to the indemnified
party under this Section 9 for any legal or other expenses subsequently incurred by the indemnified
party in connection with the defense thereof other than reasonable costs of investigation;
provided, however, that an indemnified party shall have the right to employ its own
counsel in any such action, but the fees, expenses and other charges of such counsel for the
indemnified party will be at the
27
expense of such indemnified party unless (1) the employment of counsel by the indemnified
party has been authorized in writing by the indemnifying party, (2) the indemnified party has
reasonably concluded (based upon advice of counsel to the indemnified party) that there may be
legal defenses available to it or other indemnified parties that are different from or in addition
to those available to the indemnifying party, (3) a conflict or potential conflict exists (based
upon advice of counsel to the indemnified party) between the indemnified party and the indemnifying
party (in which case the indemnifying party will not have the right to direct the defense of such
action on behalf of the indemnified party) or (4) the indemnifying party has not in fact employed
counsel reasonably satisfactory to the indemnified party to assume the defense of such action
within a reasonable time after receiving notice of the commencement of the action, in each of which
cases the reasonable fees, disbursements and other charges of counsel will be at the expense of the
indemnifying party or parties. It is understood that the indemnifying party or parties shall not,
in connection with any proceeding or related proceedings in the same jurisdiction, be liable for
the reasonable fees, disbursements and other charges of more than one separate firm of attorneys
(in addition to any local counsel) at any one time for all such indemnified party or parties and
that, in the case of indemnified parties related to the Initial Purchasers, such separate firm
shall be designated by ▇.▇. ▇▇▇▇▇▇ Securities Inc. Each indemnified party, as a condition of the
indemnity agreements contained in Sections 9(a) and 9(b), shall use all reasonable efforts to
cooperate with the indemnifying party in the defense of any such action or claim. No indemnifying
party shall be liable for any settlement of any such action effected without its written consent
(which consent shall not be unreasonably withheld), but if settled with its written consent or if
there be a final judgment for the plaintiff in any such action, the indemnifying party agrees to
indemnify and hold harmless any indemnified party from and against any loss or liability by reason
of such settlement or judgment. No indemnifying party shall, without the prior written consent of
the indemnified party (which consent shall not be unreasonably withheld), effect any settlement of
any pending or threatened proceeding in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified party unless such
settlement (x) includes an unconditional release of such indemnified party from all liability on
claims that are the subject matter of such proceedings and (y) does not include any statement as to
or any admission of fault, culpability or a failure to act by or on behalf of any indemnified
party.
The obligations of the Company, each of the Guarantors and the Initial Purchasers in this
Section 9 and in Section 10 are in addition to any other liability that the Company, each of the
Guarantors or the Initial Purchasers, as the case may be, may otherwise have, including in respect
of any breaches of representations, warranties and agreements made herein by any such party.
10. Contribution. If the indemnification provided for in Section 9 is unavailable or
insufficient to hold harmless an indemnified party under Section 9(a) or 9(b), then each
indemnifying party shall, in lieu of indemnifying such indemnified party, contribute to the amount
paid or payable by such indemnified party as a result of such loss, claim, damage or liability, or
action in respect thereof, (i) in such proportion as shall be appropriate to reflect the relative
benefits received by the Company and each of
28
the Guarantors on the one hand and the Initial Purchasers on the other from the offering of
the Securities or (ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company and each of the
Guarantors on the one hand and the Initial Purchasers on the other with respect to the statements
or omissions that resulted in such loss, claim, damage or liability, or action in respect thereof,
as well as any other relevant equitable considerations. The relative benefits received by the
Company and each of the Guarantors on the one hand and the Initial Purchasers on the other with
respect to such offering shall be deemed to be in the same proportion as the total net proceeds
from the offering of the Securities purchased under this Agreement (before deducting expenses)
received by or on behalf of the Company and each of the Guarantors, on the one hand, and the total
discounts and commissions received by the Initial Purchasers with respect to the Securities
purchased under this Agreement, on the other, bear to the total gross proceeds from the sale of the
Securities under this Agreement. The relative fault shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to the Company and each of the Guarantors or
information supplied by the Company and each of the Guarantors on the one hand or to any Initial
Purchasers’ Information on the other, the intent of the parties and their relative knowledge,
access to information and opportunity to correct or prevent such untrue statement or omissions.
The Company, each of the Guarantors and the Initial Purchasers agree that it would not be just and
equitable if contributions pursuant to this Section 10 were to be determined by pro rata allocation
(even if the Initial Purchasers were treated as one entity for such purpose) or by any other method
of allocation that does not take into account the equitable considerations referred to herein. The
amount paid or payable by an indemnified party as a result of the loss, claim, damage or liability,
or action in respect thereof, referred to above in this Section 10 shall be deemed to include, for
purposes of this Section 10, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending or preparing to defend any such action or
claim. Notwithstanding the provisions of this Section 10, no Initial Purchaser shall be required
to contribute any amount in excess of the amount by which the total discounts and commissions
received by such Initial Purchaser with respect to the Securities purchased by it under this
Agreement exceeds the amount of any damages which such Initial Purchaser has otherwise paid or
become liable to pay by reason of any untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Initial Purchasers’ obligations to contribute as provided in
this Section 10 are several in proportion to their respective purchase obligations and not joint.
29
11. Persons Entitled to Benefit of Agreement. This Agreement shall inure to the
benefit of and be binding upon the Initial Purchasers, the Company, each of the Guarantors and
their respective successors. This Agreement and the terms and provisions hereof are for the sole
benefit of only those persons, except as provided in Sections 9 and 10 with respect to officers,
directors, employees, representatives, agents and controlling persons of the Company and each of
the Guarantors and affiliates, officers, directors, employees, representatives, agents and
controlling persons of the Initial Purchasers and in Section 4(e) with respect to holders and
prospective purchasers of the Securities. Nothing in this Agreement is intended or shall be
construed to give any person, other than the persons referred to in this Section 11, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any provision contained
herein.
12. Expenses. The Company and each of the Guarantors agrees with the Initial
Purchasers to pay (a) the costs incident to the authorization, issuance, sale, preparation and
delivery of the Securities and any taxes payable in that connection; (b) the costs incident to the
preparation, printing and distribution of the Preliminary Offering Memorandum, the Offering
Memorandum and any amendments or supplements thereto; (c) the costs of reproducing and distributing
each of the Transaction Documents; (d) the costs incident to the preparation, printing and delivery
of the certificates evidencing the Securities and the Common Stock issuable upon conversion
thereof, including stamp duties and transfer taxes, if any, payable upon issuance of the Securities
and such Common Stock; (e) the fees and expenses of the Company’s counsel and independent
accountants; (f) the fees and expenses of qualifying the Securities under the securities laws of
the several jurisdictions as provided in Section 4(g) and of preparing, printing and distributing
Blue Sky Memoranda (including related fees and expenses of counsel for the Initial Purchasers); (g)
any fees charged by rating agencies for rating the Securities; (h) the fees and expenses of the
Trustee and any paying agent (including related fees and expenses of any counsel to such parties);
(i) all expenses and application fees incurred in connection with the application for the inclusion
of the Securities on The PORTAL Market and the approval of the Securities for book-entry transfer
by DTC; (j) the fees and expenses associated with listing on the New York Stock Exchange the Common
Stock issuable upon conversion of the Securities; and (k) all other costs and expenses incident to
the performance of the obligations of the Company and each of the Guarantors under this Agreement
which are not otherwise specifically provided for in this Section 12; provided,
however, that except as provided in this Section 12 and Section 8, the Initial Purchasers
shall pay their own costs and expenses, including the fees and disbursements of their counsel and
any advertising expenses (other than with respect to any roadshow presentation) connected with any
offers they may make.
13. Survival. The respective indemnities, rights of contribution, representations,
warranties and agreements of the Company, each of the Guarantors and the Initial Purchasers
contained in this Agreement or made by or on behalf of the Company, each of the Guarantors or the
Initial Purchasers pursuant to this Agreement or any certificate delivered pursuant hereto shall
survive the delivery of and payment for the Securities and shall remain in full force and effect,
regardless of any termination or
30
cancellation of this Agreement or any investigation made by or on behalf of any of them or any
of their respective affiliates, officers, directors, employees, representatives, agents or
controlling persons.
14. Notices, etc. Any action by the Initial Purchasers hereunder may be taken by the
Representative on behalf of the Initial Purchasers, and any such action taken by the Representative
shall be binding upon the Initial Purchasers. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the Initial Purchasers, shall be delivered or sent by mail or telecopy
transmission to the Initial Purchasers, c/o ▇.▇. ▇▇▇▇▇▇ Securities Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (telecopier: (▇▇▇) ▇▇▇-▇▇▇▇); Attention:
Syndicate Desk. or
(b) if to the Company or the Guarantors, shall be delivered or sent by mail or telecopy
transmission to the address of the Company set forth in the Offering Memorandum, Attention:
▇▇▇▇▇▇▇ ▇▇▇▇ (telecopier no.: (▇▇▇) ▇▇▇-▇▇▇▇), with copies to General Counsel (telecopier
no.: (▇▇▇) ▇▇▇-▇▇▇▇) and ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP (telecopier no.: (▇▇▇) ▇▇▇-▇▇▇▇).
Any such statements, requests, notices or agreements shall take effect at the time of receipt
thereof.
15. Definition of Terms. For purposes of this Agreement, (a) the term “business day”
means any day on which the New York Stock Exchange, Inc. is open for trading, (b) the term
“subsidiary” has the meaning set forth in Rule 405 under the Securities Act and (c) except where
otherwise expressly provided, the term “affiliate” has the meaning set forth in Rule 405 under the
Securities Act.
16. Initial Purchasers’ Information. The parties hereto acknowledge and agree that,
for all purposes of this Agreement, the Initial Purchasers’ Information consists solely of the
following information in the Preliminary Offering Memorandum and the Offering Memorandum: the
statements concerning the Initial Purchasers contained in the seventh paragraph, the fifth and
sixth sentences of the ninth paragraph, the eleventh paragraph, the thirteenth paragraph and the
second sentence of the fourteenth paragraph under the heading “Plan of distribution”.
17. Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York.
18. Counterparts. This Agreement may be executed in one or more counterparts (which
may include counterparts delivered by telecopier) and, if executed in more than one counterpart,
the executed agreement, counterparts shall each be deemed to be an original, but all such
counterparts shall together constitute one and the same instrument.
31
19. Amendments. No amendment or waiver of any provision of this Agreement, nor any
consent or approval to any departure therefrom, shall in any event be effective unless the same
shall be in writing and signed by the parties hereto.
20. Headings. The headings herein are inserted for convenience of reference only and
are not intended to be part of, or to affect the meaning or interpretation of, this Agreement.
32
If the foregoing is in accordance with your understanding of our agreement, kindly sign and
return to us a counterpart hereof, whereupon this instrument will become a binding agreement
between the Company, the Guarantors and the several Initial Purchasers in accordance with its
terms.
| Very truly yours, |
||||
| By: | /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ | |||
| Name: | ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ | |||
| Title: | Executive Vice President and Chief Financial Officer | |||
| By: | /s/ R. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ | |||
| R. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ | ||||
| On behalf of the GUARANTORS Listed in Schedule 1 hereto |
||||
33
Accepted: July 26, 2005
▇.▇. ▇▇▇▇▇▇ SECURITIES INC.
| By: | ▇.▇. ▇▇▇▇▇▇ SECURITIES INC., Acting on behalf of itself and as Representative of the Initial Purchasers |
By:
|
/s/ ▇▇▇▇ ▇▇▇▇▇ | |||
| Authorized Signatory |
SCHEDULE 1
GUARANTORS
AMERICAN HOSPITAL BUILDING CORPORATION
AMERICANA HEALTHCARE CENTER OF PALOS TOWNSHIP, INC.
AMERICANA HEALTHCARE CORPORATION OF GEORGIA
ANCILLARY SERVICES MANAGEMENT, INC.
▇▇▇▇▇ NURSING HOME, INC.
BIRCHWOOD MANOR, INC.
BLUE RIDGE REHABILITATION SERVICES, INC.
CANTERBURY VILLAGE, INC.
▇▇▇▇▇▇▇ ▇▇▇▇▇, INC.
CHESAPEAKE MANOR, INC.
DEKALB HEALTHCARE CORPORATION
DEVON MANOR CORPORATION
DISTCO, INC.
DIVERSIFIED REHABILITATION SERVICES, INC.
▇▇▇▇▇▇▇ MANOR, INC.
EAST MICHIGAN CARE CORPORATION
EXECUTIVE ADVERTISING, INC.
EYE-Q NETWORK, INC.
FOUR SEASONS NURSING CENTERS, INC.
GEORGIAN BLOOMFIELD, INC.
GREENVIEW MANOR, INC.
HCR HOME HEALTH CARE AND HOSPICE, INC.
HCR INFORMATION CORPORATION
HCR MANORCARE MEDICAL SERVICES OF FLORIDA, INC.
HCR MANOR CARE SERVICES, INC. (fka HEARTLAND CAREPARTNERS, INC.)
HCR PHYSICIAN MANAGEMENT SERVICES, INC.
HCR REHABILITATION CORP.
HCRA OF TEXAS, INC.
HCRC INC.
HEALTH CARE AND RETIREMENT CORPORATION OF AMERICA
HEARTLAND HOME CARE, INC.
HEARTLAND HOME HEALTH CARE SERVICES, INC.
HEARTLAND HOSPICE SERVICES, INC.
HEARTLAND INFORMATION SERVICES, INC.
(fka HEARTLAND MEDICAL INFORMATION SERVICES, INC.)
HEARTLAND MANAGEMENT SERVICES, INC.
HEARTLAND REHABILITATION SERVICES OF FLORIDA, INC.
HEARTLAND REHABILITATION SERVICES, INC.
HEARTLAND SERVICES CORP.
HEARTLAND THERAPY PROVIDER NETWORK, INC.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, RPT — ▇▇▇▇ ▇▇▇▇▇▇▇▇, RPT PHYSICAL THERAPY
PROFESSIONAL ASSOCIATES, INC.
HGCC OF ALLENTOWN, INC.
AMERICANA HEALTHCARE CENTER OF PALOS TOWNSHIP, INC.
AMERICANA HEALTHCARE CORPORATION OF GEORGIA
ANCILLARY SERVICES MANAGEMENT, INC.
▇▇▇▇▇ NURSING HOME, INC.
BIRCHWOOD MANOR, INC.
BLUE RIDGE REHABILITATION SERVICES, INC.
CANTERBURY VILLAGE, INC.
▇▇▇▇▇▇▇ ▇▇▇▇▇, INC.
CHESAPEAKE MANOR, INC.
DEKALB HEALTHCARE CORPORATION
DEVON MANOR CORPORATION
DISTCO, INC.
DIVERSIFIED REHABILITATION SERVICES, INC.
▇▇▇▇▇▇▇ MANOR, INC.
EAST MICHIGAN CARE CORPORATION
EXECUTIVE ADVERTISING, INC.
EYE-Q NETWORK, INC.
FOUR SEASONS NURSING CENTERS, INC.
GEORGIAN BLOOMFIELD, INC.
GREENVIEW MANOR, INC.
HCR HOME HEALTH CARE AND HOSPICE, INC.
HCR INFORMATION CORPORATION
HCR MANORCARE MEDICAL SERVICES OF FLORIDA, INC.
HCR MANOR CARE SERVICES, INC. (fka HEARTLAND CAREPARTNERS, INC.)
HCR PHYSICIAN MANAGEMENT SERVICES, INC.
HCR REHABILITATION CORP.
HCRA OF TEXAS, INC.
HCRC INC.
HEALTH CARE AND RETIREMENT CORPORATION OF AMERICA
HEARTLAND HOME CARE, INC.
HEARTLAND HOME HEALTH CARE SERVICES, INC.
HEARTLAND HOSPICE SERVICES, INC.
HEARTLAND INFORMATION SERVICES, INC.
(fka HEARTLAND MEDICAL INFORMATION SERVICES, INC.)
HEARTLAND MANAGEMENT SERVICES, INC.
HEARTLAND REHABILITATION SERVICES OF FLORIDA, INC.
HEARTLAND REHABILITATION SERVICES, INC.
HEARTLAND SERVICES CORP.
HEARTLAND THERAPY PROVIDER NETWORK, INC.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, RPT — ▇▇▇▇ ▇▇▇▇▇▇▇▇, RPT PHYSICAL THERAPY
PROFESSIONAL ASSOCIATES, INC.
HGCC OF ALLENTOWN, INC.
IN HOME HEALTH, INC.
INDUSTRIAL WASTES, INC.
IONIA MANOR, INC.
JACKSONVILLE HEALTHCARE CORPORATION
KNOLLVIEW MANOR, INC.
LEADER NURSING AND REHABILITATION CENTER OF BETHEL PARK, INC.
LEADER NURSING AND REHABILITATION CENTER OF GLOUCESTER, INC.
LEADER NURSING AND REHABILITATION CENTER OF ▇▇▇▇▇ TOWNSHIP, INC.
LEADER NURSING AND REHABILITATION CENTER OF VIRGINIA INC.
LINCOLN HEALTH CARE, INC.
MANOR CARE AVIATION, INC.
MANOR CARE OF AKRON, INC.
MANOR CARE OF AMERICA, INC
MANOR CARE OF ARIZONA, INC.
MANOR CARE OF ARLINGTON, INC.
MANOR CARE OF CANTON, INC.
MANOR CARE OF CHARLESTON, INC.
MANOR CARE OF CINCINNATI, INC.
MANOR CARE OF COLUMBIA, INC.
MANOR CARE OF DARIEN, INC.
MANOR CARE OF DELAWARE COUNTY, INC.
MANOR CARE OF HINSDALE, INC.
MANOR CARE OF KANSAS, INC.
MANOR CARE OF KINGSTON COURT, INC.
MANOR CARE OF LARGO, INC.
MANOR CARE OF LEXINGTON, INC.
MANOR CARE OF MEADOW PARK, INC.
MANOR CARE OF MIAMISBURG, INC
MANOR CARE OF NORTH ▇▇▇▇▇▇▇▇, INC.
MANOR CARE OF PINEHURST, INC.
MANOR CARE OF ROLLING ▇▇▇▇▇▇▇, INC.
MANOR CARE OF ROSSVILLE, INC.
MANOR CARE OF ▇▇▇▇▇▇▇▇▇▇, INC.
MANOR CARE OF WILMINGTON, INC.
MANOR CARE OF YORK (NORTH), INC.
MANOR CARE OF YORK (SOUTH), INC.
MANOR CARE SUPPLY COMPANY
MANORCARE HEALTH SERVICES OF NORTHHAMPTON COUNTY, INC.
MANORCARE HEALTH SERVICES OF OKLAHOMA, INC.
MANORCARE HEALTH SERVICES OF VIRGINIA, INC.
MANORCARE HEALTH SERVICES, INC.
MARINA VIEW MANOR, INC.
MEDI-SPEECH SERVICE, INC.
MID-SHORE PHYSICAL THERAPY ASSOCIATES, INC.
MILESTONE HEALTH SYSTEMS, INC.
MILESTONE HEALTHCARE, INC.
MILESTONE REHABILITATION SERVICES, INC.
INDUSTRIAL WASTES, INC.
IONIA MANOR, INC.
JACKSONVILLE HEALTHCARE CORPORATION
KNOLLVIEW MANOR, INC.
LEADER NURSING AND REHABILITATION CENTER OF BETHEL PARK, INC.
LEADER NURSING AND REHABILITATION CENTER OF GLOUCESTER, INC.
LEADER NURSING AND REHABILITATION CENTER OF ▇▇▇▇▇ TOWNSHIP, INC.
LEADER NURSING AND REHABILITATION CENTER OF VIRGINIA INC.
LINCOLN HEALTH CARE, INC.
MANOR CARE AVIATION, INC.
MANOR CARE OF AKRON, INC.
MANOR CARE OF AMERICA, INC
MANOR CARE OF ARIZONA, INC.
MANOR CARE OF ARLINGTON, INC.
MANOR CARE OF CANTON, INC.
MANOR CARE OF CHARLESTON, INC.
MANOR CARE OF CINCINNATI, INC.
MANOR CARE OF COLUMBIA, INC.
MANOR CARE OF DARIEN, INC.
MANOR CARE OF DELAWARE COUNTY, INC.
MANOR CARE OF HINSDALE, INC.
MANOR CARE OF KANSAS, INC.
MANOR CARE OF KINGSTON COURT, INC.
MANOR CARE OF LARGO, INC.
MANOR CARE OF LEXINGTON, INC.
MANOR CARE OF MEADOW PARK, INC.
MANOR CARE OF MIAMISBURG, INC
MANOR CARE OF NORTH ▇▇▇▇▇▇▇▇, INC.
MANOR CARE OF PINEHURST, INC.
MANOR CARE OF ROLLING ▇▇▇▇▇▇▇, INC.
MANOR CARE OF ROSSVILLE, INC.
MANOR CARE OF ▇▇▇▇▇▇▇▇▇▇, INC.
MANOR CARE OF WILMINGTON, INC.
MANOR CARE OF YORK (NORTH), INC.
MANOR CARE OF YORK (SOUTH), INC.
MANOR CARE SUPPLY COMPANY
MANORCARE HEALTH SERVICES OF NORTHHAMPTON COUNTY, INC.
MANORCARE HEALTH SERVICES OF OKLAHOMA, INC.
MANORCARE HEALTH SERVICES OF VIRGINIA, INC.
MANORCARE HEALTH SERVICES, INC.
MARINA VIEW MANOR, INC.
MEDI-SPEECH SERVICE, INC.
MID-SHORE PHYSICAL THERAPY ASSOCIATES, INC.
MILESTONE HEALTH SYSTEMS, INC.
MILESTONE HEALTHCARE, INC.
MILESTONE REHABILITATION SERVICES, INC.
MILESTONE STAFFING SERVICES, INC.
MILESTONE THERAPY SERVICES, INC.
MNR FINANCE CORP.
PEAK REHABILITATION, INC.
PERRYSBURG PHYSICAL THERAPY, INC
PNEUMATIC CONCRETE, INC.
PORTFOLIO ONE, INC.
REHABILITATION ADMINISTRATION CORPORATION
REHABILITATION ASSOCIATES, INC.
REHABILITATION SERVICES OF ROANOKE, INC.
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, INC.
▇▇▇▇▇▇▇▇ HEALTHCARE, INC.
RIDGEVIEW MANOR, INC.
▇▇▇▇▇▇ PARK NURSING CENTER, INC.
RVA MANAGEMENT SERVICES, INC.
SILVER SPRING — WHEATON NURSING HOME, INC.
SPRINGHILL MANOR, INC.
STEWALL CORPORATION
STRATFORD MANOR, INC.
STUTEX CORP.
SUN VALLEY MANOR, INC.
THE NIGHTINGALE NURSING HOME, INC.
THERASPORT PHYSICAL THERAPY, INC.
THREE RIVERS MANOR, INC.
TOTALCARE CLINICAL LABORATORIES, INC.
WASHTENAW HILLS MANOR, INC.
WHITEHALL MANOR, INC.
COLEWOOD LIMITED PARTNERSHIP
HEARTLAND CARE, LLC
HEARTLAND EMPLOYMENT SERVICES, LLC
ANCILLARY SERVICES, LLC
BOOTH LIMITED PARTNERSHIP
ANNANDALE ARDEN, LLC
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, LLC
▇▇▇▇▇▇▇ FARMS ▇▇▇▇▇, LLC
COLONIE ARDEN, LLC
CRESTVIEW HILLS, LLC
FIRST LOUISVILLE ARDEN, LLC
▇▇▇▇▇▇ ▇▇▇▇▇ LLC
HANOVER ARDEN, LLC
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, LLC
KENWOOD ARDEN, LLC
LIVONIA ARDEN, LLC
MEMPHIS ARDEN, LLC
NAPA ARDEN, LLC
ROANOKE ARDEN, LLC
SAN ▇▇▇▇▇▇▇ ▇▇▇▇▇, LLC
MILESTONE THERAPY SERVICES, INC.
MNR FINANCE CORP.
PEAK REHABILITATION, INC.
PERRYSBURG PHYSICAL THERAPY, INC
PNEUMATIC CONCRETE, INC.
PORTFOLIO ONE, INC.
REHABILITATION ADMINISTRATION CORPORATION
REHABILITATION ASSOCIATES, INC.
REHABILITATION SERVICES OF ROANOKE, INC.
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, INC.
▇▇▇▇▇▇▇▇ HEALTHCARE, INC.
RIDGEVIEW MANOR, INC.
▇▇▇▇▇▇ PARK NURSING CENTER, INC.
RVA MANAGEMENT SERVICES, INC.
SILVER SPRING — WHEATON NURSING HOME, INC.
SPRINGHILL MANOR, INC.
STEWALL CORPORATION
STRATFORD MANOR, INC.
STUTEX CORP.
SUN VALLEY MANOR, INC.
THE NIGHTINGALE NURSING HOME, INC.
THERASPORT PHYSICAL THERAPY, INC.
THREE RIVERS MANOR, INC.
TOTALCARE CLINICAL LABORATORIES, INC.
WASHTENAW HILLS MANOR, INC.
WHITEHALL MANOR, INC.
COLEWOOD LIMITED PARTNERSHIP
HEARTLAND CARE, LLC
HEARTLAND EMPLOYMENT SERVICES, LLC
ANCILLARY SERVICES, LLC
BOOTH LIMITED PARTNERSHIP
ANNANDALE ARDEN, LLC
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, LLC
▇▇▇▇▇▇▇ FARMS ▇▇▇▇▇, LLC
COLONIE ARDEN, LLC
CRESTVIEW HILLS, LLC
FIRST LOUISVILLE ARDEN, LLC
▇▇▇▇▇▇ ▇▇▇▇▇ LLC
HANOVER ARDEN, LLC
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, LLC
KENWOOD ARDEN, LLC
LIVONIA ARDEN, LLC
MEMPHIS ARDEN, LLC
NAPA ARDEN, LLC
ROANOKE ARDEN, LLC
SAN ▇▇▇▇▇▇▇ ▇▇▇▇▇, LLC
SILVER SPRING ARDEN, LLC
SUSQUEHANNA ARDEN LLC
TAMPA ARDEN, LLC
WALL ARDEN, LLC
WARMINSTER ARDEN LLC
WILLIAMSVILLE ARDEN, LLC
BATH ARDEN, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF ▇▇▇▇▇▇▇▇, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF ▇▇▇▇▇▇, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF KENWOOD, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF SAN ANTONIO, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF SUSQUEHANNA, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF WARMINSTER, LLC
FRESNO ARDEN, LLC
TUSCAWILLA ARDEN, LLC
SUSQUEHANNA ARDEN LLC
TAMPA ARDEN, LLC
WALL ARDEN, LLC
WARMINSTER ARDEN LLC
WILLIAMSVILLE ARDEN, LLC
BATH ARDEN, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF ▇▇▇▇▇▇▇▇, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF ▇▇▇▇▇▇, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF KENWOOD, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF SAN ANTONIO, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF SUSQUEHANNA, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF WARMINSTER, LLC
FRESNO ARDEN, LLC
TUSCAWILLA ARDEN, LLC
SCHEDULE 2
SUBSIDIARIES
AMERICAN HOSPITAL BUILDING CORPORATION
AMERICANA HEALTHCARE CENTER OF PALOS TOWNSHIP, INC.
AMERICANA HEALTHCARE CORPORATION OF GEORGIA
ANCILLARY SERVICES MANAGEMENT, INC.
ANCILLARY SERVICES, LLC
ANNANDALE ARDEN, LLC
▇▇▇▇▇ NURSING HOME, INC.
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, LLC
BATH ARDEN, LLC
▇▇▇▇▇▇▇ FARMS ▇▇▇▇▇, LLC
BIRCHWOOD MANOR, INC.
BLUE RIDGE REHABILITATION SERVICES, INC.
BOOTH LIMITED PARTNERSHIP
CANTERBURY VILLAGE, INC.
▇▇▇▇▇▇▇ ▇▇▇▇▇, INC.
CHESAPEAKE MANOR, INC.
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF ▇▇▇▇▇▇▇▇, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF ▇▇▇▇▇▇, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF KENWOOD, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF SAN ANTONIO, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF SUSQUEHANNA, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF WARMINSTER, LLC
COLEWOOD LIMITED PARTNERSHIP
COLONIE ARDEN, LLC
CRESTVIEW HILLS, LLC
DEKALB HEALTHCARE CORPORATION
DEVON MANOR CORPORATION
DISTCO, INC.
DIVERSIFIED REHABILITATION SERVICES, INC.
▇▇▇▇▇▇▇ MANOR, INC.
EAST MICHIGAN CARE CORPORATION
▇▇▇▇▇▇ & COMPANY, INC.
ELMHURST AMERICANA, INC.
EXECUTIVE ADVERTISING, INC.
EYE-Q NETWORK, INC.
FIRST LOUISVILLE ARDEN, LLC
FOUR SEASONS NURSING CENTERS, INC.
FRESNO ARDEN, LLC
▇▇▇▇▇▇ ▇▇▇▇▇ LLC
GEORGIAN BLOOMFIELD, INC.
GREENVIEW MANOR, INC.
AMERICANA HEALTHCARE CENTER OF PALOS TOWNSHIP, INC.
AMERICANA HEALTHCARE CORPORATION OF GEORGIA
ANCILLARY SERVICES MANAGEMENT, INC.
ANCILLARY SERVICES, LLC
ANNANDALE ARDEN, LLC
▇▇▇▇▇ NURSING HOME, INC.
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, LLC
BATH ARDEN, LLC
▇▇▇▇▇▇▇ FARMS ▇▇▇▇▇, LLC
BIRCHWOOD MANOR, INC.
BLUE RIDGE REHABILITATION SERVICES, INC.
BOOTH LIMITED PARTNERSHIP
CANTERBURY VILLAGE, INC.
▇▇▇▇▇▇▇ ▇▇▇▇▇, INC.
CHESAPEAKE MANOR, INC.
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF ▇▇▇▇▇▇▇▇, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF ▇▇▇▇▇▇, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF KENWOOD, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF SAN ANTONIO, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF SUSQUEHANNA, LLC
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF WARMINSTER, LLC
COLEWOOD LIMITED PARTNERSHIP
COLONIE ARDEN, LLC
CRESTVIEW HILLS, LLC
DEKALB HEALTHCARE CORPORATION
DEVON MANOR CORPORATION
DISTCO, INC.
DIVERSIFIED REHABILITATION SERVICES, INC.
▇▇▇▇▇▇▇ MANOR, INC.
EAST MICHIGAN CARE CORPORATION
▇▇▇▇▇▇ & COMPANY, INC.
ELMHURST AMERICANA, INC.
EXECUTIVE ADVERTISING, INC.
EYE-Q NETWORK, INC.
FIRST LOUISVILLE ARDEN, LLC
FOUR SEASONS NURSING CENTERS, INC.
FRESNO ARDEN, LLC
▇▇▇▇▇▇ ▇▇▇▇▇ LLC
GEORGIAN BLOOMFIELD, INC.
GREENVIEW MANOR, INC.
HANOVER ARDEN, LLC
HCR HOME HEALTH CARE AND HOSPICE, INC.
HCR INFORMATION CORPORATION
HCR MANOR CARE SERVICES, INC. (fka HEARTLAND CAREPARTNERS, INC.)
HCR MANORCARE MEDICAL SERVICES OF FLORIDA, INC.
HCR PHYSICIAN MANAGEMENT SERVICES, INC.
HCR REHABILITATION CORP.
HCRA OF TEXAS, INC.
HCRC INC.
HEALTH CARE AND RETIREMENT CORPORATION OF AMERICA
HEART LAND ASIA (MAURITIUS) LIMITED
HEARTLAND BANGALORE TRANSCRIPTION AND SERVICES PRIVATE LIMITED
HEARTLAND CARE, LLC
HEARTLAND DELHI TRANSCRIPTION AND SERVICES PRIVATE LIMITED
HEARTLAND EMPLOYMENT SERVICES, LLC
HEARTLAND HOME CARE, INC.
HEARTLAND HOME HEALTH CARE SERVICES, INC.
HEARTLAND HOSPICE SERVICES, INC.
HEARTLAND INFORMATION AND CONSULTANCY SERVICES PRIVATE LIMITED
HEARTLAND INFORMATION SERVICES, INC. (fka HEARTLAND MEDICAL INFORMATION SERVICES, INC.)
HEARTLAND MANAGEMENT SERVICES, INC.
HEARTLAND REHABILITATION SERVICES OF FLORIDA, INC.
HEARTLAND REHABILITATION SERVICES, INC.
HEARTLAND SERVICES CORP.
HEARTLAND THERAPY PROVIDER NETWORK, INC.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, RPT — ▇▇▇▇ ▇▇▇▇▇▇▇▇, RPT PHYSICAL THERAPY
PROFESSIONAL ASSOCIATES, INC.
HGCC OF ALLENTOWN, INC.
IN HOME HEALTH, INC.
INDUSTRIAL WASTES, INC.
IONIA MANOR, INC.
JACKSONVILLE HEALTHCARE CORPORATION
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, LLC
KENWOOD ARDEN, LLC
KNOLLVIEW MANOR, INC.
LEADER NURSING AND REHABILITATION CENTER OF BETHEL PARK, INC.
LEADER NURSING AND REHABILITATION CENTER OF GLOUCESTER, INC.
LEADER NURSING AND REHABILITATION CENTER OF ▇▇▇▇▇ TOWNSHIP, INC.
LEADER NURSING AND REHABILITATION CENTER OF VIRGINIA INC.
LINCOLN HEALTH CARE, INC.
LIVONIA ARDEN, LLC
MANOR CARE AVIATION, INC.
MANOR CARE INSURANCE, LTD.
MANOR CARE OF AKRON, INC.
MANOR CARE OF AMERICA, INC
MANOR CARE OF ARIZONA, INC.
HCR HOME HEALTH CARE AND HOSPICE, INC.
HCR INFORMATION CORPORATION
HCR MANOR CARE SERVICES, INC. (fka HEARTLAND CAREPARTNERS, INC.)
HCR MANORCARE MEDICAL SERVICES OF FLORIDA, INC.
HCR PHYSICIAN MANAGEMENT SERVICES, INC.
HCR REHABILITATION CORP.
HCRA OF TEXAS, INC.
HCRC INC.
HEALTH CARE AND RETIREMENT CORPORATION OF AMERICA
HEART LAND ASIA (MAURITIUS) LIMITED
HEARTLAND BANGALORE TRANSCRIPTION AND SERVICES PRIVATE LIMITED
HEARTLAND CARE, LLC
HEARTLAND DELHI TRANSCRIPTION AND SERVICES PRIVATE LIMITED
HEARTLAND EMPLOYMENT SERVICES, LLC
HEARTLAND HOME CARE, INC.
HEARTLAND HOME HEALTH CARE SERVICES, INC.
HEARTLAND HOSPICE SERVICES, INC.
HEARTLAND INFORMATION AND CONSULTANCY SERVICES PRIVATE LIMITED
HEARTLAND INFORMATION SERVICES, INC. (fka HEARTLAND MEDICAL INFORMATION SERVICES, INC.)
HEARTLAND MANAGEMENT SERVICES, INC.
HEARTLAND REHABILITATION SERVICES OF FLORIDA, INC.
HEARTLAND REHABILITATION SERVICES, INC.
HEARTLAND SERVICES CORP.
HEARTLAND THERAPY PROVIDER NETWORK, INC.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, RPT — ▇▇▇▇ ▇▇▇▇▇▇▇▇, RPT PHYSICAL THERAPY
PROFESSIONAL ASSOCIATES, INC.
HGCC OF ALLENTOWN, INC.
IN HOME HEALTH, INC.
INDUSTRIAL WASTES, INC.
IONIA MANOR, INC.
JACKSONVILLE HEALTHCARE CORPORATION
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, LLC
KENWOOD ARDEN, LLC
KNOLLVIEW MANOR, INC.
LEADER NURSING AND REHABILITATION CENTER OF BETHEL PARK, INC.
LEADER NURSING AND REHABILITATION CENTER OF GLOUCESTER, INC.
LEADER NURSING AND REHABILITATION CENTER OF ▇▇▇▇▇ TOWNSHIP, INC.
LEADER NURSING AND REHABILITATION CENTER OF VIRGINIA INC.
LINCOLN HEALTH CARE, INC.
LIVONIA ARDEN, LLC
MANOR CARE AVIATION, INC.
MANOR CARE INSURANCE, LTD.
MANOR CARE OF AKRON, INC.
MANOR CARE OF AMERICA, INC
MANOR CARE OF ARIZONA, INC.
MANOR CARE OF ARLINGTON, INC.
MANOR CARE OF CANTON, INC.
MANOR CARE OF CHARLESTON, INC.
MANOR CARE OF CINCINNATI, INC.
MANOR CARE OF COLUMBIA, INC.
MANOR CARE OF DARIEN, INC.
MANOR CARE OF DELAWARE COUNTY, INC.
MANOR CARE OF HINSDALE, INC.
MANOR CARE OF KANSAS, INC.
MANOR CARE OF KINGSTON COURT, INC.
MANOR CARE OF LARGO, INC.
MANOR CARE OF LEXINGTON, INC.
MANOR CARE OF MEADOW PARK, INC.
MANOR CARE OF MIAMISBURG, INC
MANOR CARE OF NORTH ▇▇▇▇▇▇▇▇, INC.
MANOR CARE OF PINEHURST, INC.
MANOR CARE OF ROLLING ▇▇▇▇▇▇▇, INC.
MANOR CARE OF ROSSVILLE, INC.
MANOR CARE OF ▇▇▇▇▇▇▇▇▇▇, INC.
MANOR CARE OF WILMINGTON, INC.
MANOR CARE OF YORK (NORTH), INC.
MANOR CARE OF YORK (SOUTH), INC.
MANOR CARE SUPPLY COMPANY
MANORCARE HEALTH SERVICES OF DELAWARE COUNTY, INC.
MANORCARE HEALTH SERVICES OF NORTHHAMPTON COUNTY, INC.
MANORCARE HEALTH SERVICES OF OKLAHOMA, INC.
MANORCARE HEALTH SERVICES OF VIRGINIA, INC.
MANORCARE HEALTH SERVICES OF WASHINGTON, INC.
MANORCARE HEALTH SERVICES, INC.
MARINA VIEW MANOR, INC.
MEDI-SPEECH SERVICE, INC.
MEMPHIS ARDEN, LLC
MID-ATLANTIC POST ACUTE NETWORK, INC.
MID-SHORE PHYSICAL THERAPY ASSOCIATES, INC.
MILESTONE HEALTH SYSTEMS, INC.
MILESTONE HEALTHCARE, INC.
MILESTONE REHABILITATION SERVICES, INC.
MILESTONE STAFFING SERVICES, INC.
MILESTONE THERAPY SERVICES, INC.
MNR FINANCE CORP.
NAPA ARDEN, LLC
NUVISTA REFRACTIVE SURGERYAND LASER CENTERS, INC.
PEAK REHABILITATION, INC.
PERRYSBURG PHYSICAL THERAPY, INC
PLM LIMITED PARTHERSHIP
PLM, INC.
PNEUMATIC CONCRETE, INC.
MANOR CARE OF CANTON, INC.
MANOR CARE OF CHARLESTON, INC.
MANOR CARE OF CINCINNATI, INC.
MANOR CARE OF COLUMBIA, INC.
MANOR CARE OF DARIEN, INC.
MANOR CARE OF DELAWARE COUNTY, INC.
MANOR CARE OF HINSDALE, INC.
MANOR CARE OF KANSAS, INC.
MANOR CARE OF KINGSTON COURT, INC.
MANOR CARE OF LARGO, INC.
MANOR CARE OF LEXINGTON, INC.
MANOR CARE OF MEADOW PARK, INC.
MANOR CARE OF MIAMISBURG, INC
MANOR CARE OF NORTH ▇▇▇▇▇▇▇▇, INC.
MANOR CARE OF PINEHURST, INC.
MANOR CARE OF ROLLING ▇▇▇▇▇▇▇, INC.
MANOR CARE OF ROSSVILLE, INC.
MANOR CARE OF ▇▇▇▇▇▇▇▇▇▇, INC.
MANOR CARE OF WILMINGTON, INC.
MANOR CARE OF YORK (NORTH), INC.
MANOR CARE OF YORK (SOUTH), INC.
MANOR CARE SUPPLY COMPANY
MANORCARE HEALTH SERVICES OF DELAWARE COUNTY, INC.
MANORCARE HEALTH SERVICES OF NORTHHAMPTON COUNTY, INC.
MANORCARE HEALTH SERVICES OF OKLAHOMA, INC.
MANORCARE HEALTH SERVICES OF VIRGINIA, INC.
MANORCARE HEALTH SERVICES OF WASHINGTON, INC.
MANORCARE HEALTH SERVICES, INC.
MARINA VIEW MANOR, INC.
MEDI-SPEECH SERVICE, INC.
MEMPHIS ARDEN, LLC
MID-ATLANTIC POST ACUTE NETWORK, INC.
MID-SHORE PHYSICAL THERAPY ASSOCIATES, INC.
MILESTONE HEALTH SYSTEMS, INC.
MILESTONE HEALTHCARE, INC.
MILESTONE REHABILITATION SERVICES, INC.
MILESTONE STAFFING SERVICES, INC.
MILESTONE THERAPY SERVICES, INC.
MNR FINANCE CORP.
NAPA ARDEN, LLC
NUVISTA REFRACTIVE SURGERYAND LASER CENTERS, INC.
PEAK REHABILITATION, INC.
PERRYSBURG PHYSICAL THERAPY, INC
PLM LIMITED PARTHERSHIP
PLM, INC.
PNEUMATIC CONCRETE, INC.
PORTFOLIO ONE, INC.
REHABILITATION ADMINISTRATION CORPORATION
REHABILITATION ASSOCIATES, INC.
REHABILITATION SERVICES OF ROANOKE, INC.
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, INC.
▇▇▇▇▇▇▇▇ HEALTHCARE, INC.
RIDGEVIEW MANOR, INC.
ROANOKE ARDEN, LLC
▇▇▇▇▇▇ PARK NURSING CENTER, INC.
RVA MANAGEMENT SERVICES, INC.
SAN ▇▇▇▇▇▇▇ ▇▇▇▇▇, LLC
SILVER SPRING — WHEATON NURSING HOME, INC.
SILVER SPRING ARDEN, LLC
SPRINGHILL MANOR, INC.
STEWALL CORPORATION
STRATFORD MANOR, INC.
STUTEX CORP.
SUN VALLEY MANOR, INC.
SUSQUEHANNA ARDEN LLC
TAMPA ARDEN, LLC
THE NIGHTINGALE NURSING HOME, INC.
THERASPORT PHYSICAL THERAPY, INC.
THREE RIVERS MANOR, INC.
TOTALCARE CLINICAL LABORATORIES, INC.
TUSCAWILLA ARDEN, LLC
VISION MANAGEMENT SERVICES, INC.
WALL ARDEN, LLC
WARMINSTER ARDEN LLC
WASHTENAW HILLS MANOR, INC.
WHITEHALL MANOR, INC.
WILLIAMSVILLE ARDEN, LLC
WINTER PARK NURSING CENTER, INC.
REHABILITATION ADMINISTRATION CORPORATION
REHABILITATION ASSOCIATES, INC.
REHABILITATION SERVICES OF ROANOKE, INC.
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, INC.
▇▇▇▇▇▇▇▇ HEALTHCARE, INC.
RIDGEVIEW MANOR, INC.
ROANOKE ARDEN, LLC
▇▇▇▇▇▇ PARK NURSING CENTER, INC.
RVA MANAGEMENT SERVICES, INC.
SAN ▇▇▇▇▇▇▇ ▇▇▇▇▇, LLC
SILVER SPRING — WHEATON NURSING HOME, INC.
SILVER SPRING ARDEN, LLC
SPRINGHILL MANOR, INC.
STEWALL CORPORATION
STRATFORD MANOR, INC.
STUTEX CORP.
SUN VALLEY MANOR, INC.
SUSQUEHANNA ARDEN LLC
TAMPA ARDEN, LLC
THE NIGHTINGALE NURSING HOME, INC.
THERASPORT PHYSICAL THERAPY, INC.
THREE RIVERS MANOR, INC.
TOTALCARE CLINICAL LABORATORIES, INC.
TUSCAWILLA ARDEN, LLC
VISION MANAGEMENT SERVICES, INC.
WALL ARDEN, LLC
WARMINSTER ARDEN LLC
WASHTENAW HILLS MANOR, INC.
WHITEHALL MANOR, INC.
WILLIAMSVILLE ARDEN, LLC
WINTER PARK NURSING CENTER, INC.
SCHEDULE 3
| SIGNIFICANT SUBSIDIARIES | GOOD STANDING JURISDICTIONS | |
HCRC Inc. |
None | |
Manor Care of America, Inc. |
Florida | |
| Pennsylvania | ||
| Illinois | ||
ManorCare Health Services, Inc. Health Care and Retirement Corporation of America |
Texas | |
| Ohio | ||
| Michigan | ||
| Florida | ||
| Pennsylvania | ||
| Illinois |
SCHEDULE 4
INITIAL PURCHASERS
| Principal Amount of | ||||
| Initial Purchaser | Securities | |||
▇.▇. ▇▇▇▇▇▇ Securities Inc. |
$ | 200,000,000 | ||
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ &
▇▇▇▇▇ Incorporated |
100,000,000 | |||
Banc of America Securities LLC |
24,800,000 | |||
SunTrust Capital Markets, Inc. |
24,800,000 | |||
UBS Securities LLC |
24,800,000 | |||
Wachovia Capital Markets, Inc. |
19,000,000 | |||
Huntington Capital Corp. |
3,300,000 | |||
NatCity Investments, Inc. |
3,300,000 | |||
Total |
$ | 400,000,000 | ||
ANNEX A
[Form of Registration Rights Agreement]
ANNEX B-1
[Form of Opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇]
ANNEX B-2
[Form of Opinion of R. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇]
ANNEX B-3
[Form of Opinion of ▇▇▇▇ ▇▇▇▇▇ LLP]
ANNEX C
[Letterhead of executive officer or director of the Company]
__________, 2005
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
This letter is being delivered to you in connection with a proposed Purchase Agreement (the
“Purchase Agreement”) between Manor Care, Inc., a Delaware corporation (the “Company”), the
Guarantors parties thereto and each of you as initial purchasers named therein, whereby you have
agreed to purchase up to $400,000,000 aggregate principal amount of the Company’s Convertible
Senior Notes Due 2035, convertible into Shares of Common Stock, par value $0.01 per share (the
“Securities”), of the Company pursuant to the Purchase Agreement.
In order to induce you to purchase the Securities pursuant to the Purchase Agreement, the
undersigned will not, without the prior written consent of ▇.▇. ▇▇▇▇▇▇ Securities Inc., offer,
sell, contract to sell, pledge or otherwise dispose of, or file (or participate in the filing of) a
registration statement with the U.S. Securities and Exchange Commission in respect of, or establish
or increase a put equivalent position or liquidate or decrease a call equivalent position within
the meaning of Section 16 of the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the U.S. Securities and Exchange Commission promulgated thereunder with respect to,
any shares of capital stock of the Company or any securities convertible or exercisable or
exchangeable for such capital stock, or publicly announce an intention to effect any such
transaction, for a period of 90 days after the date of the Purchase Agreement.
Notwithstanding the foregoing, the undersigned may offer, sell, contract to sell, pledge or
otherwise dispose of (or enter into any transaction that is designed to result in the disposition
of) Common Stock (i) as a bona fide gift, (ii) to any trust, family partnership or similar entity
for the direct or indirect benefit of the undersigned, provided that trust, partnership or similar
entity agrees to be bound by the restrictions set forth herein or (iii) to effect a cashless
exercise of options to purchase Common Stock that are outstanding on the date of this letter or
hereafter issued under the Company’s existing stock option plans and to pay the taxes related
thereto. The undersigned may also participate in the filing of any registration statement that the
Company is permitted to file (or participate in the filing of) under Section 4(k) of the Purchase
Agreement.
Notwithstanding the foregoing, the undersigned may participate in the filing of a registration
statement with the Securities and Exchange Commission in respect of any issuance by the Company of
Common Stock in compliance with the conditions set forth in Section 4(k) of the Purchase Agreement.
2
If for any reason the Purchase Agreement shall be terminated prior to the Closing Date (as
defined in the Purchase Agreement), the agreement set forth above shall likewise be terminated.
| Very truly yours, |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||