Central European Media Enterprises Ltd. €150,000,000 Senior Floating Rate Notes due 2014 Purchase Agreement
Exhibit
10.63
EXECUTION
VERSION
▇.▇.
▇▇▇▇▇▇ SECURITIES LTD.
€150,000,000
Senior Floating Rate Notes due 2014
May
9,
2007
▇.▇.
▇▇▇▇▇▇ Securities Ltd.
▇▇▇
▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
▇▇▇▇▇▇
Brothers International (Europe)
▇▇
▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇▇▇,
▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇
ING
Bank
N.V. London Branch
▇▇
▇▇▇▇▇▇
▇▇▇▇
▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇
Ladies
and Gentlemen:
Central
European Media Enterprises Ltd., a Company organized under the laws of Bermuda
(the “Company”), proposes to issue and sell to the several Initial
Purchasers listed in Schedule 1 hereto (the “Initial Purchasers”), for
whom ▇.▇. ▇▇▇▇▇▇ Securities Ltd. is acting as representative (the
“Representative”), (i) €150,000,000 Senior Floating Rate Notes due 2014
(the “Notes”). The Notes will be issued pursuant to an
Indenture to be dated as of May 16, 2007 (the
“Indenture”) among the Company, and Central European Media Enterprises
N.V. (“CME N.V.”) and CME Media Enterprises B.V.
(“CME B.V.”) (collectively, the
“Guarantors”), The Bank of New York
as security agent (the “Security
Agent”), and BNY Corporate
Trustee Services Limited as trustee (the
“Trustee”), and will be guaranteed on a senior basis (the
“Guarantees”) by the Guarantors.
The
obligations of the Issuer under the Notes will be secured by (a) a pledge
of the shares of CME N.V. and CME B.V. and (b) an assignment of the
Issuer’s rights under the framework agreement by and between the Issuer and PPF
(Cyprus) Ltd. (“PPF”) dated as of December 13, 2004 (the “Framework
Agreement”).
The
shares of CME N.V. and CME B.V. are collectively referred to as the Pledged
Shares, and the Pledged Shares and the assignment of rights under the Framework
Agreement are collectively referred to as the
“Collateral”. The share pledges in respect of the Pledged
Shares are referred to as the “Share Pledges” and, together with the
assignment agreements evidencing the assignment of rights under the Framework
Agreement, the “Security Documents”.
In
connection with the offering of the Notes, the Security Agent, the Trustee
and
certain other parties will enter into an amended and restated intercreditor
agreement (the “Intercreditor Agreement”). The Security Documents and the
Intercreditor Agreement are hereinafter referred to as the “Finance
Documents.”
The
Notes
will be sold to the Initial Purchasers without being registered under the U.S.
Securities Act of 1933, as amended (the “Securities Act”), in reliance
upon exemptions therefrom. The Company has prepared a preliminary
offering memorandum dated May 9, 2007 (the “Preliminary
Offering Memorandum”) and will prepare an offering memorandum dated the date
hereof (the “Offering Memorandum”) setting forth information concerning
the Company and its subsidiaries, the Notes and the
Guarantees. 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 purchase agreement (this
“Agreement”). The Company hereby confirms that it has
authorized the use of the Preliminary Offering Memorandum, the Time of Sale
Information (as defined below) and the Offering Memorandum in connection with
the offering and resale of the Notes by the Initial Purchasers in the manner
contemplated by this Agreement. Capitalized terms used but not
defined herein shall have the meanings given to such terms in the Preliminary
Offering Memorandum. References herein to the Preliminary Offering
Memorandum and the Offering Memorandum shall be deemed to refer to and include
any document incorporated by reference therein.
At
4:30
pm (BST) on May 9, 2007 (the “Time of Sale”), the following information shall
have been prepared (collectively, the “Time of Sale Information”): the
Preliminary Offering Memorandum, as supplemented and amended by the term sheets
appended as Annex B hereto.
The
Company will use the net proceeds of the Notes for general corporate purposes,
including the potential purchase of additional ownership interests in its
existing operations in Romania and Ukraine to the extent such opportunities
arise.
The
Company and each of the Guarantors hereby confirm their agreement with the
several Initial Purchasers concerning the purchase and resale of the Notes,
as
follows:
1. Purchase
and Resale of the Notes. (a) The Company agrees to
issue and sell the Notes to the several Initial Purchasers as provided in
this
Agreement, and each Initial Purchaser, on the basis of the representations,
warranties and agreements set forth herein and subject to the conditions
set
forth herein, agrees, severally and not jointly, to purchase from the Company
the respective principal amount of Notes at the purchase price set forth
opposite such Initial Purchaser's name in Schedule 1 hereto. The
Company will not be obligated to deliver any of the Notes except upon payment
for all the Notes to be purchased as provided herein.
(b) Each
of the Company and the Guarantors understands that the Initial Purchasers
intend
to offer the Notes for resale on the terms set forth in the Time of Sale
Information. Each Initial Purchaser, severally and not jointly,
represents, warrants and agrees that:
(i) it
is a qualified institutional buyer within the meaning of Rule 144A under the
Securities Act (a “QIB”) and an accredited investor within the meaning of
Rule 501(a) 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 Notes 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”) or in any manner involving a public
offering within the meaning of Section 4(2) of the Securities Act;
and
(iii) it
has not solicited offers for, or offered or sold, and will not solicit offers
for, or offer or sell, the Notes as part of their initial offering
except:
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(A) within
the United States to persons whom it reasonably believes to be QIBs in
transactions pursuant to Rule 144A under the Securities Act (“Rule 144A”)
and in connection with each such sale, it has taken or will take reasonable
steps to ensure that the purchaser of the Notes is aware that such sale is
being
made in reliance on Rule 144A; or
(B) in
accordance with the restrictions set forth in Annex A hereto.
(c) Each
Initial Purchaser acknowledges and agrees that each of the Company and the
Guarantors and, for purposes of the opinions to be delivered to the Initial
Purchasers pursuant to Sections 0 and 0, counsel for the Company and the
Guarantors and counsel for the Initial Purchasers, respectively, may rely upon
the accuracy of the representations and warranties of the Initial Purchasers,
and compliance by the Initial Purchasers with their agreements, contained in
paragraph (b) above (including Annex A hereto), and each Initial Purchaser
hereby consents to such reliance.
(d) Each
of the Company and the Guarantors acknowledges and agrees that the Initial
Purchasers may offer and sell Notes to or through any affiliate of an Initial
Purchaser and that any such affiliate may offer and sell Notes purchased by
it
to or through any Initial Purchaser.
(e) Each
of the Company and the Guarantors acknowledges and agrees that each Initial
Purchaser is acting solely in the capacity of an arm's length contractual
counterparty to the Company and the Guarantors with respect to the offering
of
Notes contemplated hereby (including in connection with determining the terms
of
the offering) and not as financial advisor or fiduciary to, or agent of, the
Company, the Guarantors or any other person. Additionally, the
Initial Purchasers are not advising the Company, the Guarantors or any other
person as to any legal, tax, investment, accounting or regulatory matters in
any
jurisdiction. The Company and the Guarantors shall consult with their
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 neither any responsibility nor
any
liability to the Company or the Guarantors with respect thereto. Any review
by
the Initial Purchasers of the Company, the Guarantors, and 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, the Guarantors or any other person.
2. Payment
and Delivery. (b) The closing of the purchase of the
Notes by the several Initial Purchasers will occur at the offices of ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ &Bartlett LLP, One ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ at 9:00 A.M.,
London time, on May 16, 2007, or at such other time or place on the same or
such
other date, not later than the fifth business day thereafter, as the
Representative and the Company may agree upon in writing. The time
and date of such payment and delivery is referred to herein as the “Closing
Date”.
(b) The
Notes sold within the United States to QIBs in reliance on Rule 144A will be
represented by one or more global notes in registered form without interest
coupons attached (the “144A Global Note”). The Notes sold
outside the United States in reliance on Regulation S under the Securities
Act
(“Regulation S”) will be represented by one or more global notes in
registered form without interest coupons attached (together with the Rule 144A
Global Note, the “Global Notes”).
(c) Payment
for the Notes shall be made by the Representative on behalf of the several
Initial Purchasers in immediately available funds to a common depositary (the
“Common Depositary”) for Euroclear Bank S.A./N.V. (“Euroclear”)
and Clearstream Banking société anonyme (“Clearstream”) against
delivery to the Common Depositary, for the account of the Initial Purchasers,
of
the Global Notes, with any transfer taxes payable in connection with the sale
of
the Notes duly paid by the Company.,
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3. Representations
and Warranties of the Company and the Guarantors. The Company,
and the Guarantors jointly and severally represent and warrant to each Initial
Purchaser that:
(a) Preliminary
Offering Memorandum, Time of Sale Information and Offering
Memorandum. The Preliminary Offering Memorandum, as of its date,
did not, the Time of Sale Information, at the Time of Sale, did not, and the
Offering Memorandum, as of its date and as of the Closing Date, will not,
contain any 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 under which they were made, not misleading; provided that
the Company and the Guarantors make no representation or warranty with respect
to any statements or omissions made in reliance upon and in conformity with
information relating to any Initial Purchaser furnished to the Company in
writing by such Initial Purchaser through the Representative expressly for
use
in the Preliminary Offering Memorandum, the Time of Sale Information or the
Offering Memorandum, it being understood and agreed that the only such
information is that described in Section 0 hereof. No order or decree
preventing the use of the Time of Sale Information or the Offering Memorandum,
or any order asserting that the transactions contemplated by this Agreement
are
subject to the registration requirements of the Securities Act or any other
securities laws has been issued, and no proceeding for that purpose has
commenced or is pending or, to the knowledge of the Company or any of the
Guarantors, is contemplated.
(b) Additional
Written Communications. Other than the Preliminary
Offering Memorandum and the Offering Memorandum, neither the Company, nor any
Guarantor (including its respective agents and representatives, other than
the
Initial Purchasers in their capacity as such, as to which no representation
is
made) has made, used, prepared, authorized, approved or referred to or will
prepare, make, use, authorize, approve or refer to any written communication
that constitutes an offer to sell or solicitation of an offer to buy the Notes
other than the term sheet substantially in the form of Annex B hereto and other
written communications used in accordance with Section 0.
(c) Financial
Statements. The financial statements and the related notes
thereto included in each of the Time of Sale Information and the Offering
Memorandum present fairly the financial position of the Company and its
subsidiaries as of the dates indicated and the results of their operations
and
the changes in their cash flows for the periods specified; such financial
statements have been prepared in conformity with generally accepted accounting
principles in the United States (“GAAP”) applied on a consistent basis
throughout the periods covered thereby; the other financial information and
data
included in each of the Time of Sale Information and the Offering Memorandum
has
been derived from the accounting records or operating systems of the Company
and
its subsidiaries and presents fairly the information shown thereby; and the
pro forma financial information and the related notes thereto included
in the Time of Sale Information and the Offering Memorandum (i) present fairly
the information shown therein, (ii) have been prepared in accordance with GAAP
on a basis consistent with the financial statements and related notes included
in the Time of Sale Information and the Offering Memorandum (except for the
pro forma adjustments specified therein) and represent fairly the
transactions described in the Time of Sale Information and the Offering
Memorandum, (iii) except as set forth in the Offering Memorandum, include all
material adjustments to the financial statements included in the Time of Sale
Information and the Offering Memorandum necessary to give effect to the
transactions referred to therein and (iv) the assumptions underlying such
pro forma financial information are reasonable and are set forth in the
Time of Sale Information and the Offering Memorandum..
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(d) No
Material Adverse Change. Since the date of the most recent
financial statements of the Company and its subsidiaries included in each of
the
Time of Sale Information and the Offering Memorandum, (i) 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, set aside
for payment, paid or made by the Company on any class of capital stock, or
any
material adverse change, or any development in the business, properties,
financial position, results of operations, shareholders’ equity, cashflow or
prospects of the Company and its subsidiaries taken as a whole, (ii) other
than
this Agreement between the Company and the Initial Purchasers or their
affiliates, dated May 9, 2007 neither the Company nor any of its subsidiaries
has entered into any transaction or material agreement, that is of a type which
would be required to be disclosed as an exhibit to a registration statement
filed in connection with an offering of securities under the U.S. federal
securities laws, to the Company and its subsidiaries taken as a whole or
incurred any liability or obligation, direct or contingent, that is material
to
the Company and its subsidiaries taken as a whole and (iii) 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, whether or not
covered by insurance, or from any labor disturbance or dispute or any action,
order or decree of any court or arbitrator or governmental or regulatory
authority, except in each case as otherwise disclosed in the Time of Sale
Information or the Offering Memorandum.
(e)
Organization and Good Standing. The Company and each of its
subsidiaries have been duly organized and are validly existing and, where
applicable, in good standing under the laws of their respective jurisdictions
of
organization, are duly qualified to do business and, where applicable, are
in
good standing 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 be so qualified or have such power or authority
would not, individually or in the aggregate, have a material adverse effect
on
the business, properties, financial position, results of operations,
shareholders’ equity, cashflow or prospects of the Company and its subsidiaries
taken as a whole, or on the performance by the Company and its subsidiaries
of
its obligations under the Notes and the Guarantees (a “Material Adverse
Effect”). Except as disclosed in the notes to the financial
statements included in the Time of Sale Information or the Offering Memorandum,
none of the Company or any of its material subsidiaries is in bankruptcy,
liquidation or receivership or subject to any similar proceeding. The
Company does not own or control, directly or indirectly, any corporation,
association or other entity other than the subsidiaries listed in the notes
to
the financial statements included in the Time of Sale Information or the
Offering Memorandum.
(f)
Capitalization. The Company has capitalization as set forth
in the each of the Time of Sale Information and the Offering Memorandum under
the heading “Capitalization”; and all the outstanding shares of capital stock or
other equity interests of the Company and of each direct and indirect subsidiary
of the Company, which, in the case of shares of subsidiaries that are owned
by
the Company, have been duly and validly authorized and issued, are fully paid
and non-assessable and, in the case of shares of subsidiaries, are owned
directly or indirectly by the Company, free and clear of any lien, charge,
encumbrance, security interest, restriction on voting or transfer or any other
claim of any third party, except as otherwise disclosed in each of the Time
of
Sale Information and the Offering Memorandum. Except as otherwise
disclosed in each of the Time of Sale Information and the Offering Memorandum
there are no outstanding options, warrants or other rights to purchase or
acquire any shares of the Company or any shares of its subsidiaries owned by
the
Company or one of its subsidiaries.
5
(g) Due
Authorization. The Company and each of the Guarantors, as
applicable, have full right, power and authority to execute and deliver this
Agreement, the Notes, the Indenture (including the Guarantees set forth
therein), the Finance Documents and any other agreement or instrument entered
into with respect to the offering of the Notes (collectively, the
“Transaction Documents”) and to perform their respective obligations
hereunder and thereunder; and all action (corporate or other) 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 has been duly and validly taken.
(h) The
Indenture. 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 as enforceability may be limited by applicable bankruptcy, fraudulent
conveyance, insolvency or similar laws affecting the enforcement of creditors’
rights generally or by equitable principles relating to enforceability
(collectively, the “Enforceability Exceptions”).
(i)
The Notes and the Guarantees. The Notes have been duly
authorized by the Company and, when duly executed, authenticated, issued and
delivered as provided in the Indenture 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 enforceable against the Company in accordance
with their terms, subject to the Enforceability Exceptions, and will be entitled
to the benefits of the Indenture; and the Guarantees have been duly authorized
by each of the Guarantors and, when the Notes have been duly executed,
authenticated, issued and delivered as provided in the Indenture and paid for
as
provided herein, will be valid and legally binding obligations of each of the
Guarantors, enforceable against each of the Guarantors in accordance with their
terms, subject to the Enforceability Exceptions, and will be entitled to the
benefits of the Indenture.
(j)
The Purchase Agreement. This Agreement has been duly
executed and delivered 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, subject to the Enforceability
Exceptions.
(k) The
Finance Documents. Each of the Finance Documents has been duly executed and
delivered by the Company and the Guarantors, as applicable, and when duly
executed and delivered in accordance with their respective terms by each of
the
other parties thereto, will constitute valid and legally binding agreements
of
each of the Company and the Guarantors, as applicable, enforceable against
each
of them in accordance with their terms.
(l) Creation,
Enforceability and Perfection of Security Interests. The
applicable pledging entity under each Security Document owns the relevant
collateral covered by such Security Document (the “Collateral”), free and
clear of any security interest, mortgage, pledge, lien, encumbrance,
restrictions on transfer or any other similar claim of any other third party
(except for the security interests granted to JPMorgan Chase Bank, N.A., London
Branch under the indenture dated May 5, 2005 to the €370,000,000
aggregate amount of 8.25% Senior Notes due 2012 and Senior Floating Rate Notes
due 2012 and to the European Bank for Reconstruction and Development under
a
five-year revolving loan agreement dated July 21, 2006 for
€100,000,000). All filings and other actions necessary or desirable
to perfect and protect the security interest in the Collateral to be created
under the Security Documents have been or will be at or prior to the Closing
Date duly made or taken and are or will be at or prior to the Closing Date
in
full force and effect and, together with the execution and delivery of the
Security Documents by the Company and each Guarantor, will create a valid and
enforceable security interest in the Collateral securing the obligations of
the
Company and each Guarantor under the Indenture.
6
(m) Descriptions
and Fair Summaries. The descriptions in the Time of Sale
Information and the Offering Memorandum of statutes, legal, governmental and
regulatory proceedings and contracts and other documents are accurate in all
material respects; the statements in the Time of Sale Information and the
Offering Memorandum under the headings “Description of other indebtedness”,
“Material Bermuda and United States federal income tax considerations” and “Risk
factors¾Enforcement
of civil
liabilities and judgments may be difficult” fairly summarize the matters therein
described in all material respects; and each Transaction Document conforms
in
all material respects to the description thereof contained in the Time of Sale
Information and the Offering Memorandum.
(n) No
Violation or Default. Neither the Company nor any of its
subsidiaries is (i) in violation of its charter or by-laws or similar
organizational documents, (ii) in default, and no event has occurred that,
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 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 or
(iii)
in violation of any license, authorization, law or statute or any judgment,
order, rule or regulation of any court or arbitrator or governmental or
regulatory authority, except, in the case of clauses (ii) and (iii) above,
for
any such default or violation that would not, individually or in the aggregate,
have a Material Adverse Effect.
(o) No
Conflicts. The authorization, 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 and sale of the Notes
(including 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 will not (i) 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 indenture, mortgage, deed of trust, loan agreement
or other 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, (ii) result in any violation of the provisions of the charter or
by-laws or similar organizational documents of the Company or any of its
subsidiaries or (iii) result in the violation of any law or statute or any
judgment, order, rule or regulation of any court or arbitrator or governmental
or regulatory authority, except in the case of clauses (i) and (iii) above,
for
any such conflict, breach or violation that would not, individually or in the
aggregate, have a Material Adverse Effect.
(p) No
Consents Required. No consent, approval, authorization, order,
filing, registration or qualification of or with any court or arbitrator or
governmental or regulatory authority 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 and sale of the Notes
(including 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, except for such consents, approvals,
authorizations, orders and registrations or qualifications as may be required
under applicable securities laws in connection with the purchase and resale
of
the Notes by the Initial Purchasers.
7
(q) Legal
Proceedings. Except as described in each of the Time of Sale
Information and the Offering Memorandum, there are no legal, governmental or
regulatory investigations, actions, suits or proceedings pending to which the
Company or any of its subsidiaries is or may be a party or to which any property
of the Company or any of its subsidiaries is or may be the subject that,
individually 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 and each of the Guarantors
no
such investigations, actions, suits or proceedings are threatened by any
governmental or regulatory authority or by others.
(r)
Independent Accountants. Deloitte & Touche LLP, who have
certified certain financial statements of the Company and its subsidiaries
are
independent public accountants with respect to the Company and its subsidiaries
within the meaning of Rule 101 of the Code of Professional Conduct of the
American Institute of Certified Public Accountants and its interpretations
and
rulings thereunder and applicable accounting rules and
regulations. The report of Deloitte & Touche LLP on the audited
financial statements of the Company included in the Time of Sale Information
and
the Offering Memorandum does not contain any limitation or restriction on the
ability of the Initial Purchasers or the purchasers of the Notes to rely upon
such report.
(s) Title
to Real and Personal Property. The Company and 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 that are material
to
the respective businesses of the Company and its subsidiaries, in each case
free
and clear of all liens, encumbrances, claims and defects and imperfections
of
title except those that (i) do not materially interfere with the use made and
proposed to be made of such property by the Company and its subsidiaries or
(ii)
could not reasonably be expected, individually or in the aggregate, to have
a
Material Adverse Effect.
(t)
Title to Intellectual Property. The Company and 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, computer software and know-how
(including trade secrets and other unpatented and/or unpatentable proprietary
or
confidential information, systems or procedures) necessary for the conduct
of
their respective businesses except where the failure to possess, or own such
rights would not have a Material Adverse Effect; and to the knowledge of the
Company the conduct of their respective businesses will not conflict in any
material respect with any such rights of others, and the Company and its
subsidiaries have not received any notice of any claim of infringement of or
conflict with any such rights of others and are unaware of any facts which
would
form a reasonable basis for any such claim, except as to such conduct or
infringement which would not have a Material Adverse Effect.
(u) Investment
Company Act. The Company is not, and after giving effect to the
offering and sale of the Notes and the application of the proceeds thereof
as
described in each of the Time of Sale Information and the Offering Memorandum
will not be, an “investment company” or an entity “controlled” by an “investment
company” within the meaning of the U.S. Investment Company Act of 1940, as
amended, and the rules and regulations of the U.S. Securities and Exchange
Commission (the “Commission”) thereunder (collectively, the
“Investment Company Act”).
(v) Passive
Foreign Investment Company. The Company is not, and does not
expect to become, a “passive foreign investment company” as defined in Section
1297 of the U.S. Internal Revenue Code of 1986, as amended, and the regulations
promulgated thereunder.
8
(w)
Taxes. Except as would not have a Material Adverse Effect,
the Company and its subsidiaries have paid all national, regional, local and
other taxes and filed all tax returns required to be paid or filed through
the
date hereof; and except as otherwise disclosed in each of the Time of Sale
Information and the Offering Memorandum, there is no tax deficiency that has
been, or could reasonably be expected to be, asserted against the Company or
any
of its subsidiaries or any of their respective properties or
assets.
(x)
No Withholding Tax. All payments to be made by the Company
under this Agreement and, except as otherwise disclosed in each of the Time
of
Sale Information and the Offering Memorandum, all interest, principal, premium,
if any, additional amounts, if any, and other payments on or under the Notes
or
the Guarantees may, under the current laws and regulations of Bermuda, the
Netherlands Antilles and the Netherlands or any political subdivision or any
authority or agency therein or thereof having power to tax, or of any other
jurisdiction in which the Company or a Guarantor, as the case may be, is
organized or is otherwise resident for tax purposes or any jurisdiction from
or
through which a payment is made (each, a “Relevant Taxing Jurisdiction”),
be paid in euro that may be converted into another currency and freely
transferred out of the Relevant Taxing Jurisdiction and all such interest on
the
Notes will not be subject to withholding or other taxes under the current laws
and regulations of the Relevant Taxing Jurisdiction and are otherwise payable
free and clear of any other tax, withholding or deduction in the Relevant Taxing
Jurisdiction and without the necessity of obtaining any governmental
authorization in the Relevant Taxing Jurisdiction.
(y)
Stamp Duty. Except as otherwise disclosed in each of the
Time of Sale Information and the Offering Memorandum, no stamp, issuance,
transfer or other similar taxes or duties are payable by or on behalf of the
Initial Purchasers in Bermuda, the Netherlands Antilles and the Netherlands,
the
United Kingdom or the United States or any political subdivision or taxing
authority thereof or therein on (i) the creation, issue or delivery by the
Company of the Notes, (ii) the creation, issue or delivery by the Guarantors
of
the Guarantees, (iii) the purchase by the Initial Purchasers of the Notes in
the
manner contemplated by this Agreement, (iv) the resale and delivery by the
Initial Purchasers of the Notes contemplated by this Agreement or (v) the
execution and delivery of this Agreement and the other Transaction Documents
and
the consummation of the transactions contemplated hereby and
thereby.
(z)
No Labor Disputes. No labor disturbance by or dispute with
employees of the Company or any of its subsidiaries exists or, to the best
knowledge of the Company and each of the Guarantors, is threatened which could,
individually or in the aggregate, have a Material Adverse Effect; to the best
knowledge of the Company and each of the Guarantors, no labor disturbance by
or
dispute with employees or agents of suppliers or customers of the Company or
any
of its subsidiaries is threatened which could, individually or in the aggregate,
have a Material Adverse Effect.
(aa) Licenses
and Permits. The Company and its subsidiaries possess all
licenses, certificates, permits and other authorizations issued by, and have
made all declarations and filings with, the appropriate national, regional,
local or other governmental or regulatory authorities that are necessary for
the
ownership or lease of their respective properties or the conduct of their
respective businesses as described in each of the Time of Sale Information
and
the Offering Memorandum, except where the failure to possess or make the same
would not, individually or in the aggregate, have a Material Adverse Effect;
and
except as described in each of the Time of Sale Information and the Offering
Memorandum, neither the Company nor any of its subsidiaries has received notice
of any revocation or modification of any such license, certificate, permit
or
authorization or has any reason to believe that any such license, certificate,
permit or authorization will not be renewed in the ordinary course, except
where
receipt of such notice of any revocation or modification of any such license,
certificate, permit or authorization would not have a Material Adverse
Effect.
9
(bb) Books
and Records. The minute books and records of the Company, each
of its subsidiaries relating to proceedings of their respective shareholders,
boards of directors and committees of their respective boards of directors
made
available to counsel for the Initial Purchasers are their original minute books
and records or are true, correct and complete copies thereof, with respect
to
all proceedings of said shareholders, boards of directors and committees since
January, 2002, through the date hereof. In the event that definitive
minutes have not been prepared with respect to any proceedings of such
shareholders, boards of directors or committees, the Company has provided
counsel for the Initial Purchasers with originals or true, correct and complete
copies of draft minutes, which drafts, if any, reflect all material events
that
occurred in connection with such proceedings.
(cc) Compliance
With Environmental Laws. The Company and its subsidiaries (i)
are in compliance with any and all applicable international, national, regional,
local and other laws, rules, regulations, decisions and orders relating to
the
protection of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants (collectively,
“Environmental Laws”), (ii) have received and are in compliance with all
permits, licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses (collectively,
“Environmental Permits”), and (iii) have not received
notice of any actual or potential liability for the investigation or remediation
of any disposal or release of hazardous or toxic substances or wastes,
pollutants or contaminants, except in any such case for any such failure to
comply with, or failure to receive required permits, licenses or approvals,
or
liability, as would not, individually or in the aggregate, have a Material
Adverse Effect; and the Company and its subsidiaries are not aware of any
pending investigation which might reasonably be expected to lead to a claim
of
such liability, except any such liability as would not, individually or in
the
aggregate, have a Material Adverse Effect.
(dd) Compliance
With Employee Arrangements. Except as would not be reasonably
expected to have a Material Adverse Effect, each benefit and compensation plan,
agreement, policy and arrangement that is maintained, administered or
contributed to by the Company or any of its subsidiaries for current or former
employees or directors of, or independent contractors with respect to, the
Company or any of its subsidiaries, or with respect to which any of such
entities could reasonably be expected to have any current, future or contingent
liability or responsibility, has been maintained in compliance with its terms
and the requirements of any applicable statutes, orders, rules and regulations;
the Company and each of its subsidiaries and each of their respective affiliates
have complied with all applicable statutes, orders, rules and regulations in
regard to such plans, agreements, policies and arrangements.
(ee) Related
Party Transactions. Except as otherwise disclosed in each of the
Time of Sale Information and the Offering Memorandum, no material relationship,
direct or indirect, exists between or among any of the Company or any of its
subsidiaries on the one hand, and any director, officer, shareholder, or other
affiliate of the Company or any of its subsidiaries on the other hand, which
is
material to either entity having an interest in the relationship.
(ff) Insurance. Except
as would not be reasonably expected to have a Material Adverse Effect, the
Company and its subsidiaries have insurance covering their respective
properties, operations, personnel and businesses, which insurance is in amounts
and insures against such losses and risks as are adequate to protect the Company
and its subsidiaries and except as would not be reasonably expected to have
a
Material Adverse Effect their respective businesses; and neither the Company
nor
any of its subsidiaries has (i) 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 or (ii) any reason
to
believe that it will not be able to renew its existing insurance coverage as
and
when such coverage expires or to obtain similar coverage at reasonable cost
from
similar insurers as may be necessary to continue its business.
10
(gg) Accounting
Controls. Except as otherwise disclosed in each of the Time of Sale
Information and the Offering Memorandum, the Company makes and keeps books
and
records which are accurate in all material respects and maintain systems 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 GAAP 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.
(hh) No
Unlawful Payments. Neither the Company nor any of its
subsidiaries nor, to the best knowledge of the Company and each of the
Guarantors, any director, officer, agent, employee or other person acting on
behalf of the Company or any of its subsidiaries has (i) used any corporate
funds for any unlawful contribution, gift, entertainment or other unlawful
expense relating to political activity, (ii) made any direct or indirect
unlawful payment to any government official or employee from corporate funds,
(iii) violated or is in violation of any provision of the U.S. Foreign Corrupt
Practices Act of 1977 or any applicable law or regulation implementing the
OECD
convention on Combating Bribery of Foreign Public Officials in International
Business Transactions, (iv) made any bribe, rebate, payoff, influence payment,
kickback or other unlawful payment.
(ii)
Money Laundering. The operations of the Company and
its subsidiaries are and have been conducted at all times in compliance with
applicable financial record keeping and reporting requirements of Bermuda and
the European Union, so far as the Company and each of the Guarantors are aware,
and any related or similar statutes, rules, regulations or guidelines, issued,
administered or enforced by any governmental agency (collectively, the “Money
Laundering Laws”), and no action, suit or proceeding by or before any court
or governmental agency, authority or body or any arbitrator involving the
Company or any of its subsidiaries with respect to the Money Laundering Laws
is
pending or, to the best knowledge of the Company and each of the Guarantors,
threatened.
(jj)
Solvency. On and immediately after the Closing Date, each of
the Company and the Guarantors (after giving effect to the issuance of the
Notes, the application of the proceeds therefrom and the other transactions
related thereto as described in each of the Time of Sale Information and 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 (i) the present fair market value (or present fair saleable value) of
the
assets of the Company or any Guarantor is not less than the total amount
required to pay the liabilities of the Company or such Guarantor on its total
existing debts and liabilities (including contingent liabilities) as they become
absolute and matured, (ii) the Company and each 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,
(iii) assuming consummation of the issuance of the Notes as contemplated by
this
Agreement, the Time of Sale Information and the Offering Memorandum, none of
the
Company or any Guarantor is incurring debts or liabilities beyond its ability
to
pay as such debts and liabilities mature, (v) neither the Company nor any of
the
Guarantors is over-indebted or otherwise insolvent within the meaning of such
insolvency law as may be applicable to the Company or any of the Guarantors;
and
(vi) no proceedings have been commenced for purposes of, and no judgment has
been rendered for, the administration, liquidation, bankruptcy or winding-up
of
the Company or any of its material subsidiaries.
11
(kk)
No Restrictions on Subsidiaries. Except as would not be reasonably
expected to have a Material Adverse Effect, no subsidiary of the Company 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,
from
making any other distribution on such subsidiary’s capital stock, from repaying
any intercompany loans or advances or from transferring any of such subsidiary’s
properties or assets to the Company or any other subsidiary of the
Company.
(ll)
No Broker’s Fees. Neither the Company nor any of its
subsidiaries is a party to any contract, agreement or understanding with any
person (other than this Agreement dated May 9, 2007) that would give rise to
a
valid claim against any of them or any Initial Purchaser for a brokerage
commission, finder’s fee or like payment in connection with the offering and
sale of the Notes.
(mm) Rule
144A Eligibility. On the Closing Date, the Notes and the
Guarantees will not be of the same class (within the meaning of Rule 144A under
the Securities Act) as securities of the Company or any Guarantor that are
listed on a national securities exchange registered under Section 6 of the
Exchange Act or quoted in an automated inter-dealer quotation system; and each
of the Preliminary Offering Memorandum and the Offering Memorandum, as of its
respective date, contains or will contain all the information that, if requested
by a prospective purchaser of the Notes, would be required to be provided to
such prospective purchaser pursuant to Rule 144A(d)(4) under the Securities
Act.
(nn) No
Integration. Neither the Company nor any of its affiliates (as
defined in Rule 501(b) of Regulation D) has, directly or through any agent,
sold, offered for sale, solicited offers to buy or otherwise negotiated in
respect of, any security (as defined in the Securities Act), that is or will
be
integrated with the sale of the Notes and the Guarantees in a manner that would
require registration of the Notes and the Guarantees under the Securities
Act.
(oo) No
General Solicitation or Directed Selling Efforts. None of the
Company or any of its affiliates or any other person acting on its or their
behalf (other than the Initial Purchasers, as to which no representation is
made) has (i) solicited offers for, or offered or sold, the Notes by means
of
any form of general solicitation or general advertising within the meaning
of
Rule 502(c) of Regulation D or in any manner involving a public offering within
the meaning of Section 4(2) of the Securities Act or (ii) engaged in any
directed selling efforts within the meaning of Regulation S, and all such
persons have complied with the offering restrictions requirement of Regulation
S.
(pp) Securities
Law Exemptions. Assuming the accuracy of the representations and
warranties of the Initial Purchasers contained in Section 1(b) (including Annex
A hereto) and their compliance with their agreements set forth therein, it
is
not necessary, in connection with the issuance and sale of the Notes to the
Initial Purchasers and the offer, resale and delivery of the Notes by the
Initial Purchasers in the manner contemplated by this Agreement, the Time of
Sale Information and the Offering Memorandum, to register the Notes under the
Securities Act or to qualify the Indenture under the U.S. Trust Indenture Act
of
1939, as amended.
(qq) No
Stabilization. Neither the Company nor any of its subsidiaries
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 Notes.
12
(rr) Stabilization
Notice. The Company has been informed of the existence of the
United Kingdom Financial Services Authority stabilizing guidance contained
in
Section MAR 2, ▇▇▇ 2G of the Handbook of rules and guidance issued by the
Financial Services Authority; and none of the Company or any Guarantor has
taken
any action or omitted to take any action (such as issuing any press release
relating to any Notes without an appropriate legend) which may result in the
loss by any of the Initial Purchasers of the ability to rely on any
stabilization safe harbor provided under the Financial Services and Markets
▇▇▇
▇▇▇▇ (“FSMA”).
(ss) Forward-Looking
Statements. No forward-looking statement (within the meaning of
Section 27A of the Securities Act and Section 21E of the Exchange Act) contained
in any of the Time of Sale Information or the Offering Memorandum has been
made
or reaffirmed without a reasonable basis or has been disclosed other than in
good faith.
(tt) Margin
Rules. Neither the issuance, sale and delivery of the Notes nor
the application of the proceeds thereof by the Company as described in each
of
the Time of Sale Information and the Offering Memorandum will violate or result
in a violation of Section 7 of the Exchange Act, or any regulation promulgated
thereunder, including without limitation, Regulation T, U or X of the Board
of
Governors of the U.S. Federal Reserve System or any other regulation of such
Board of Governors.
(uu) Statistical
and Market Data. The industry, statistical and market-related
data included in each of the Time of Sale Information and the Offering
Memorandum is based on or derived from sources that the Company and the
Guarantors believe to be reliable and accurate in all material
respects.
(vv) U.S.
Jurisdiction. Each of the Company and the Guarantors has the
power to submit, and pursuant to this Agreement and each other Transaction
Document governed by New York law has submitted, or at the Closing Date will
have submitted, legally, validly, effectively and irrevocably, to the
jurisdiction of any U.S. Federal or New York State court in the Borough of
Manhattan in the City of New York, New York; and each of the Company and the
Guarantors has the power to designate, appoint and empower, and pursuant to
this
Agreement and each other Transaction Document governed by New York law has,
or
at the Closing Date will have, designated, appointed and empowered, validly,
effectively and irrevocably, an agent for service of process in any suit or
proceeding based on or arising under this Agreement and each such Transaction
Document in any U.S. Federal or New York State court in the Borough of Manhattan
in the City of New York, as provided herein and in such Transaction
Documents.
(ww) No
Immunity. None of the Company or any of its subsidiaries, and
none of their respective properties or assets, has any immunity from the
jurisdiction of any court or from any legal process (whether through service
or
notice, attachment prior to judgment, attachment in aid of execution, executing
or otherwise) under the laws of any jurisdiction in which it has been
incorporated or in which any of its property or assets are held.
(xx) Compliance
with Sanction Legislation. The Company, on behalf of itself
and its subsidiaries, represents and warrants that none of the issue and sale
of
the Notes, the execution, delivery and performance of the Transaction Documents,
the use of proceeds from the offering, or the consummation of any other
transaction contemplated hereby or the fulfillment of the terms hereof, or
the
provision of services to any of the foregoing will result in a violation by
any
person (including, without limitation, the Initial Purchasers) of any trade,
economic or military sanctions issued against any nation by the United Nations
or any governmental or regulatory authority of the European Union, the United
States, the United Kingdom or, or any orders or licenses publicly issued under
the authority of any of the foregoing.
13
(yy) Exchange
Listing. Application has been made to list the Notes on the
Luxembourg Stock Exchange (the “Exchange”) and, in connection therewith,
the Company has caused to be prepared and submitted to the Exchange a listing
application with respect to the Notes.
(zz) Compliance
with FSMA. Neither the Company nor any of the Guarantors has
distributed and, prior to the later to occur of (i) the Closing Date and (ii)
the completion of the distribution of the Notes, will not distribute any
material in connection with the offering and sale of the Notes other than the
Preliminary Offering Memorandum or the Offering Memorandum or other materials,
if any, permitted by the Securities Act and FSMA (or regulations promulgated
pursuant to the Securities Act or FSMA) and approved by the parties to this
Agreement.
4. Further
Agreements of the Company and the Guarantors. The Company and
each of the Guarantors jointly and severally covenant and agree with each
Initial Purchaser that:
(a) Delivery
of Copies. The Company will deliver to the Initial Purchasers,
without charge, as many copies of the Preliminary Offering Memorandum, any
other
Time of Sale Information and the Offering Memorandum (including all amendments
and supplements thereto) as the Representative may reasonably
request.
(b) Offering
Memorandum, Amendments or Supplements. Before finalizing the
Offering Memorandum or making or distributing any amendment or supplement to
any
of the Time of Sale Information or the Offering Memorandum, the Company and
each
of the Guarantors will furnish to the Representative and counsel for the Initial
Purchasers a copy of the proposed Offering Memorandum or such proposed amendment
or supplement for review, and will not distribute any such proposed Offering
Memorandum, amendment or supplement to which the Representative or the counsel
to the Initial Purchasers reasonably objects unless such amendment or supplement
is required to be made or distributed by applicable provisions of U.S. federal
securities laws.
(c) Additional
Written Communications. Before using, authorizing, approving or referring
to any written communication (as defined in the Securities Act) that constitutes
an offer to sell or a solicitation of an offer to buy the Notes (an “Issuer
Written Communication”) (other than written communications that are contained in
Annex B hereto and the Offering Memorandum), the Company will furnish to the
Representative and counsel of the Initial Purchasers a copy of such written
communication for review and will not use, authorize, approve or refer to any
such written communication to which the Initial Purchasers reasonably
object.
(d) Notice
to the Representative. The Company and each of the Guarantors
will advise the Representative promptly, and confirm such advice in writing,
(i)
of the issuance by any governmental or regulatory authority of any order
preventing or suspending the use of any of the Time of Sale Information or
the
Offering Memorandum or promptly upon becoming aware of the initiation or
threatening of any proceeding for that purpose, (ii) of the occurrence of any
event at any time prior to the completion of the initial offering of the Notes
as a result of which any of the Time of Sale Information or the Offering
Memorandum as then amended or supplemented would include any 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 when such Time
of
Sale Information or the Offering Memorandum is delivered to a purchaser, not
misleading and (iii) of the receipt by the Company or each of the Guarantors
of
any notice with respect to any suspension of the qualification of the Notes
for
offer and sale in any jurisdiction or promptly upon becoming aware of the
initiation or threatening of any proceeding for such purpose; and the Company
and each of the Guarantors will use their reasonable best efforts to prevent
the
issuance of any such order preventing or suspending the use of any of the Time
of Sale Information or the Offering Memorandum or suspending any such
qualification of the Notes and, if any such order is issued, will use its
reasonable best efforts to obtain as soon as possible the withdrawal
thereof.
14
(e) Ongoing
Compliance of the Offering Memorandum and Time of Sale
Information. If at any time prior to the completion of the
initial offering of the Notes (as notified by the Initial Purchasers to the
Company) (i) any event shall occur or condition shall exist as a result of
which
the Offering Memorandum as then amended or supplemented would include any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances existing
when the Offering Memorandum is delivered to a purchaser, not misleading or
(ii)
it is necessary to amend or supplement the Offering Memorandum to comply with
law, the Company will promptly notify the Initial Purchasers thereof and
forthwith prepare, at its own expense and, subject to paragraph (b) above,
furnish to the Initial Purchasers such amendments or supplements to the Offering
Memorandum as may be necessary so that the statements in the Offering Memorandum
as so amended or supplemented will not, in the light of the circumstances
existing when the Offering Memorandum is delivered to a purchaser, be misleading
or so that the Offering Memorandum will comply with law.
(f)
Qualification of the Notes. The Company and each of the
Guarantors will qualify the Notes for offer and sale under the securities or
Blue Sky laws of such jurisdictions as the Representative shall reasonably
request and will continue such qualifications in effect so long as required
for
the offering and resale of the Notes; provided that neither the Company
nor any of the Guarantors shall be required to (i) qualify as a foreign
corporation or other entity or as a dealer in securities in any such
jurisdiction where it would not otherwise be required to so qualify, (ii) file
any general consent to service of process in any such jurisdiction or (iii)
subject itself to taxation in any such jurisdiction if it is not otherwise
so
subject.
(g) Clear
Market. During the period from the date hereof through and
including the date that is 90 days after the date hereof,
the Company and each of the Guarantors will not, without the prior written
consent of each Initial Purchaser, offer, sell, contract to sell or otherwise
dispose of any debt securities issued or guaranteed by the Company or any of
the
Guarantors and having a tenor of more than one year (other than the
Notes).
(h) Use
of Proceeds. The Company will apply the net proceeds from the
sale of the Notes as described in each of the Time of Sale Information and
the
Offering Memorandum under the heading “Use of Proceeds”.
(i) Supplying
Information. While the Notes remain outstanding and are
“restricted securities” within the meaning of Rule 144(a)(3) under the
Securities Act, the Company and each of the Guarantors will, during any period
in which the Company is not subject to and in compliance with Section 13 or
15(d) of the Exchange Act and not exempt from reporting under Rule 12g3-2(b)
under the Exchange Act, furnish to holders of the Notes and prospective
purchasers of the Notes designated by such holders, upon the request of such
holders or such prospective purchasers, the information required to be delivered
pursuant to Rule 144A(d)(4) under the Securities Act.
(j)
Euroclear and Clearstream. The Company will assist the
Initial Purchasers in arranging for the Notes to be eligible for clearance
and
settlement through Euroclear and Clearstream and to maintain such eligibility
for so long as the Notes remain outstanding.
15
(k) No
Resales by the Company. During the period from the Closing Date
until two years after the Closing Date, the Company will not, and will not
permit any of its affiliates (as defined in Rule 144 under the Securities Act)
to, resell any of the Notes that have been acquired by any of them, except
for
Notes purchased by the Company or any of its affiliates and resold in a
transaction registered under the Securities Act or in a transaction outside
the
United States in accordance with Regulation S.
(l)
No Integration. Neither the Company nor any of its
affiliates (as defined in Rule 501(b) of Regulation D) will, directly or through
any agent, sell, offer for sale, solicit offers to buy or otherwise negotiate
in
respect of, any security (as defined in the Securities Act), that is or will
be
integrated with the sale of the Notes in a manner that would require
registration of the Notes under the Securities Act.
(m) No
General Solicitation or Directed Selling Efforts. None of the
Company or any of its affiliates or any other person acting on their behalf
(other than the Initial Purchasers, as to which no covenant is given) will
(i)
solicit offers for, or offer or sell, the Notes by means of any form of general
solicitation or general advertising within the meaning of Rule 502(c) of
Regulation D or in any manner involving a public offering within the meaning
of
Section 4(2) of the Securities Act or (ii) engage in any directed selling
efforts within the meaning of Regulation S, and all such persons will comply
with the offering restrictions requirement of Regulation S.
(n) No
Stabilization. Neither the Company nor any of its subsidiaries
will take, 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 Notes, or issue any press or other public announcement
referring to the proposed offering of the Notes that does not adequately
disclose the fact that stabilizing action may take place with respect to the
Notes. The Company and the Guarantors authorize the Representatives
to make adequate public disclosure of the information required by the U.K.
Financial Services Authority's Code of Market Conduct (MAR2): Price Stabilising
Rules.
(o) Exchange
Listing. The Company will use its reasonable best efforts to
list, subject to notice of issuance, the Notes on the Exchange and to maintain
such listing on the Exchange, and to have the Notes admitted to trading on
the
Exchange as promptly as practicable after the date hereof, and in any event
prior to the date of the first interest payment on the Notes. If the
Notes cease to be listed on the Exchange, the Company shall use its reasonable
best efforts as soon as practicable to list such Notes on a stock exchange
to be
agreed between the Company and the Representative.
(p) Taxes. The
Company and each of the Guarantors will, jointly and severally, indemnify and
hold harmless the Initial Purchasers against any documentary, stamp or similar
issuance tax, including any interest and penalties, in Bermuda or any other
jurisdiction, on the creation, issuance and sale of the Notes and on the initial
resale thereof by the Initial Purchasers and on the execution and delivery
of
this Agreement.
(q) Payments. The
Company further agrees that all amounts payable hereunder shall be paid in
euro
and free and clear of, and without any deduction or withholding for or on
account of, any current or future taxes (other than income taxes), levies,
imposts, duties, charges or other deductions or withholdings levied in any
jurisdiction from or through which payment is made, unless such deduction or
withholding is required by applicable law, in which event the Company will
pay
additional amounts so that the persons entitled to such payments will receive
the amount that such persons would otherwise have received but for such
deduction or withholding after allowing for any tax credit or other benefit
each
such person receives by reason of such deduction or withholding.
16
(r)
Press Releases. Prior to the Closing Date and for a period
of 40 days, subsequent to the Closing Date, neither the Company nor any of
the
Guarantors will issue any press release or other communication or hold any
press
conference (except for routine communications in the ordinary course of business
consistent with past practice) with respect to the Company or any of its
subsidiaries, the condition, financial or otherwise, or the earnings, business
affairs or business prospects of the Company or any of its subsidiaries, without
the prior consent of the Initial Purchasers (such consent not to be unreasonably
withheld and provided that if no response is received from the Initial
Purchasers within 24 hours of receipt by the Initial Purchasers of such draft
press release or other communication or notice of a press conference, as the
case may be, such consent will be deemed to have been given), unless in the
judgment of the Company and the Guarantors and their counsel, and after
notification to the Initial Purchasers, such press release or communication
is
required by law or except as issued in accordance with the Securities Act and
the rules and regulations promulgated thereunder.
(s) Interim
Financial Statements. Prior to Closing, the Company shall
furnish to the Initial Purchasers any unaudited interim financial statements,
management accounts or similar information of the Company or the Company’s group
promptly after they have been prepared in final form, for any periods subsequent
to the periods covered by the financial statements appearing in the Time of
Sale
Information and the Offering Memorandum.
(t)
Legends. Each certificate for a Note will bear a legend in “Transfer
Restrictions” in the Time of Sale Information and the Offering Memorandum for
the time period and upon the other terms stated in the Time of Sale Information
and the Offering Memorandum.
5. Certain
Agreements of the Initial Purchasers. Each Initial Purchaser,
severally and not jointly, hereby represents and agrees that it has not and
will
not use, authorize use of, refer to, or participate in the planning for use
of,
any written communication that constitutes an offer to sell or the solicitation
of an offer to buy the Notes other than:
(i) a
written communication that contains no “issuer information” (as defined
in Rule 433(h)(2) under the Securities Act) that was not included in the
Preliminary Offering Memorandum;
(ii) any
written communication contained in Annex B or prepared pursuant to Section
0
above;
(iii) any
written communication prepared by the Initial Purchasers and approved by the
Company in advance in writing; or
(iv)
any written communication relating to or that contains the terms of the Notes
and/or other information that was included in the Preliminary Offering
Memorandum.
6. Conditions
of Initial Purchasers’ Obligations. The obligation of each
Initial Purchaser to purchase Notes on the Closing Date as provided herein
is
subject to the performance by the Company and each of the Guarantors of their
respective covenants and other obligations hereunder and to the following
additional conditions:
(a) Delivery
and Accuracy of Offering Memorandum. The Time of Sale Information and Final
Offering Memorandum (and any amendments or supplements thereto) will have been
printed and copies distributed to the Initial Purchasers as promptly as
practicable on or after the date of this Agreement or at such other date and
time as to which the Initial Purchasers may agree.
17
(b) Representations
and Warranties and Agreements. The representations and
warranties of the Company and the Guarantors contained herein shall be true
and
correct on the date hereof and on and as of the Closing Date; and the statements
of the Company, the Guarantors and their respective officers made in any
certificates delivered pursuant to this Agreement shall be true and correct
on
and as of the Closing Date; and the Company and each of the Guarantors shall
have complied with all agreements and all conditions to be performed or
satisfied on their part hereunder at or prior to the Closing Date.
(c) No
Downgrade. Subsequent to the execution and delivery of this
Agreement, (i) no downgrading, which shall include imposing a condition on
the
Company retaining any rating assigned to the Company, shall have occurred in
the
rating accorded the Notes or any other debt securities or preferred stock issued
or guaranteed by the Company or any of the Guarantors by ▇▇▇▇▇’▇ Investor
Services, Inc. (“Moody’s”) or Standard & Poors, a part
of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. (“S&P”) or any other
“internationally 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 Notes 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).
(d) No
Material Adverse Change. Subsequent to the execution and
delivery of this Agreement, no event or condition of a type described in Section
0 hereof shall have occurred or shall exist, which event or condition is not
described in each of the Time of Sale Information (excluding any amendment
or
supplement thereto) and the Offering Memorandum (excluding any amendment or
supplement thereto) and the effect of which in the judgment of the
Representative makes it impracticable or inadvisable to proceed with the
offering, sale or delivery of the Notes on the terms and in the manner
contemplated by this Agreement, the Time of Sale Information and the Offering
Memorandum.
(e) Officer’s
Certificates. The Representative shall have received on and as
of the Closing Date a certificate or certificates of an executive officer of
the
Company and of each Guarantor who has specific knowledge of the financial
matters of the Company or of such Guarantor, as applicable, and is satisfactory
to the Representative (i) confirming that such officer has carefully reviewed
the Time of Sale Information and the Offering Memorandum and, to the best
knowledge of such officer, the representation set forth in Section 0 hereof
is
true and correct, (ii) confirming that the other representations and warranties
of the Company and the Guarantors in this Agreement are true and correct and
that the Company and the Guarantors have complied with all agreements and
satisfied all conditions on their part to be performed or satisfied hereunder
at
or prior to the Closing Date, (iii) to the effect set forth in paragraphs (c)
and (d) above and (iv) as to such other matters as the Representative may
reasonably request.
(f) Comfort
Letters. On the date (and prior to the execution) of this
Agreement and on the Closing Date, Deloitte & Touche LLP shall have
furnished to the Representative, at the request of the Company, letters, dated
the respective dates of delivery thereof and addressed to the Initial
Purchasers, in form and substance reasonably satisfactory to the Representative,
containing statements and information of the type customarily included in
accountants’ “comfort letters” to underwriters with respect to the financial
statements and certain financial information contained in each of the Time
of
Sale Information and the Offering Memorandum; provided that the letter
delivered on the Closing Date shall use a “cut-off” date no more than three
business days prior to the Closing Date. Such letters shall not
contain any statement purporting to limit the liability of Deloitte & Touche
LLP with respect to such letters or specify that any such liability must be
adjudicated by a court in the jurisdiction of Deloitte & Touche LLP or, to
the extent that the laws of the jurisdiction of Deloitte & Touche LLP
provide for any such limitation or forum for adjudication, such letters shall
expressly waive such provisions to the fullest extent permitted by applicable
law.
18
(g) Opinions
of Counsel for the Company and the Guarantors. Each of ▇▇▇▇▇▇
▇▇▇▇▇▇ Rosenman LLP, U.S. counsel for the Company and the Guarantors, ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP, U.K. counsel for the Company and the Guarantors,
▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇, Bermuda counsel for the Company and the Guarantors,
Loyens & Loeff, The Netherlands counsel to the Company and the Guarantors,
Loyens & Loeff, The Netherlands Antilles counsel to the Company and the
Guarantors, and ▇▇▇▇▇▇ ▇▇▇▇, Esq., general counsel to the Company and the
Guarantors, shall have furnished to the Representative, at the request of the
Company, its written opinion, dated the Closing Date and addressed to the
Initial Purchasers, in form and substance reasonably satisfactory to the
Representative. Such opinions of counsel shall not contain any
statement purporting to limit the liability of such counsel with respect to
such
opinion or specify that any such liability must be adjudicated by a court in
the
jurisdiction of such counsel or, to the extent that the laws of the jurisdiction
of such counsel provide for any limitation or forum of adjudication, such
opinion shall expressly waive such provisions to the fullest extent permitted
by
applicable law.
(h) Opinion
of Counsel for the Initial Purchasers. The Representative shall
have received on and as of the Closing Date an opinion of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇ LLP, counsel for the Initial Purchasers, and such counsel shall have
received such documents and information as they may reasonably request to enable
them to pass upon such matters.
(i) Good
Standing. The Representative shall have received on and as of
the Closing Date satisfactory evidence of, where applicable, the good standing
of the Company and its subsidiaries listed in Schedule 2 to this Agreement
in
their respective jurisdictions of organization and, where applicable, their
good
standing in such other jurisdictions as the Representative may reasonably
request, in each case in writing or any standard form of telecommunication,
from
the appropriate governmental authorities of such jurisdictions.
(j)
No Legal Impediment to Issuance. No action shall have
been taken and no statute, rule, regulation or order shall have been enacted,
adopted or issued by any national, regional, local or other governmental or
regulatory authority that would, as of the Closing Date, prevent the issuance
or
sale of the Notes or the issuance of the Guarantees; and no injunction or order
of any supranational, national, regional, local or other court shall have been
issued that would, as of the Closing Date, prevent the issuance or sale of
the
Notes or the issuance of the Guarantees.
(k) Euroclear
and Clearstream. The Notes shall be eligible for clearance and
settlement through Euroclear and Clearstream.
(l)
Additional Documents. On or prior to the Closing Date, the
Company and the Guarantors shall have furnished to the Representative such
further certificates and documents, including secretary’s certificates of the
Company and each of the Guarantors, as the Representative may reasonably request
in form and substance reasonably satisfactory to the
Representative.
(m) Indenture. The
Indenture (in form and substance satisfactory to the Initial Purchasers) shall
have been duly executed and delivered by the Company, each of the Guarantors
and
the Trustee on the Closing Date and shall be in full force and effect on such
date and the Notes shall have been duly executed and delivered by the Company
and each of the Guarantors and duly authenticated by the Trustee on the Closing
Date.
19
(n) Transaction
Documents. On the Closing Date, the Transaction Documents (in the form
reasonably satisfactory to the Initial Purchasers) shall have been duly and
validly executed and delivered by the Company, the Guarantors, the Trustee
and
the Security Agent.
(o) Officer’s
Certificate of the Trustee. The Trustee shall have furnished to
the Initial Purchasers an officer’s certificate, dated the Closing Date, in form
and substance reasonably satisfactory to the Initial Purchasers.
(p) Officer’s
Certificate of the Security Trustee. The Security Trustee shall
have furnished to the Initial Purchasers an officer’s certificate, dated the
Closing Date, in form and substance reasonably satisfactory to the Initial
Purchasers.
(q) Finance
Documents. The Finance Documents shall have been duly executed
and delivered by the parties thereto, the security interests created pursuant
thereto shall be effective and the Security Agent shall hold a valid and
perfected security interest in the Collateral securing the obligations of the
Company and the Guarantors, in each case, for the benefit of the Trustee and
the
benefit of holders of the Notes on or prior to, and as of, the Closing
Date.
(r) Appointment
of Agents. The Company shall have appointed the Trustee, or an
agent satisfactory to the Trustee, to act as registrar, transfer agent and
principal paying agent under the Indenture, and shall have appointed a
Luxembourg paying agent and transfer agent under the Indenture. The
Company shall have appointed the Security Agent to act as security agent under
the Finance Documents.
All
opinions, letters, certificates and evidence 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 counsel for
the Initial Purchasers.
7. Indemnification
and Contribution.
(a) Indemnification
of the Initial Purchasers. The Company and each of the
Guarantors jointly and severally agree to indemnify and hold harmless each
Initial Purchaser, its affiliates, directors and officers and each person,
if
any, who controls such Initial Purchaser within the meaning of Section 15 of
the
Securities Act or Section 20 of the Exchange Act, from and against any and
all
losses, claims, damages and liabilities (including, without limitation, legal
fees and other expenses incurred in connection with any suit, action or
proceeding or any claim asserted, as such fees and expenses are incurred),
joint
or several, that arise out of, or are based upon, any untrue statement or
alleged untrue statement of a material fact contained in the Time of Sale
Information or the Offering Memorandum (or any amendment or supplement thereto)
or any omission or alleged omission to state therein a material fact necessary
in order to make the statements therein, in the light of the circumstances
under
which they were made, not misleading, except insofar as such losses, claims,
damages or liabilities arise out of, or are based upon, any untrue statement
or
omission or alleged untrue statement or omission made in reliance upon and
in
conformity with any information relating to any Initial Purchaser furnished
to
the Company in writing by such Initial Purchaser through the Representative
expressly for use therein (it being understood that the only such information
is
that described in Section 7(b) hereof).
20
(b) Indemnification
of the Company and the Guarantors. Each Initial Purchaser
agrees, severally and not jointly, to indemnify and hold harmless the Company,
each of the Guarantors, their respective directors and officers and each person,
if any, who controls the Company or any of the Guarantors within the meaning
of
Section 15 of the Securities Act or Section 20 of the Exchange Act to the same
extent as the indemnity set forth in paragraph (a) above, but only with respect
to any losses, claims, damages or liabilities that arise out of, or are based
upon, any untrue statement or omission or alleged untrue statement or omission
made in reliance upon and in conformity with any information relating to such
Initial Purchaser furnished to the Company in writing by such Initial Purchaser
through the Representative expressly for use in the Preliminary Offering
Memorandum, any of the other Time of Sale Information or the Offering Memorandum
(or any amendment or supplement thereto), it being understood and agreed that
the only such information consists of the sixth, eighth and eleventh paragraphs
relating to the Initial Purchasers under the heading “Plan of Distribution” in
each of the Preliminary Offering Memorandum and the Offering
Memorandum.
(c) Notice
and Procedures. If any suit, action, proceeding (including any
governmental or regulatory investigation), claim or demand shall be brought
or
asserted against any person in respect of which indemnification may be sought
pursuant to either paragraph (a) or (b) above, such person (the “Indemnified
Person”) shall promptly notify the person against whom such indemnification
may be sought (the “Indemnifying Person”) in writing; provided
that the failure to notify the Indemnifying Person shall not relieve it from
any
liability that it may have under this Section 0 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 Person shall not relieve it from any liability that
it may have to an Indemnified Person otherwise than under this Section
0. If any such proceeding shall be brought or asserted against an
Indemnified Person and it shall have notified the Indemnifying Person thereof,
the Indemnifying Person shall be entitled to participate in, and assume the
defense of, such proceeding with counsel reasonably satisfactory to the
Indemnified Person and shall pay the fees and expenses of such counsel related
to such proceeding, as incurred. In any such proceeding, any
Indemnified Person shall have the right to retain its own counsel, but the
fees
and expenses of such counsel shall be at the expense of such Indemnified Person
unless (i) the Indemnifying Person and the Indemnified Person shall have
mutually agreed to the contrary, (ii) the Indemnifying Person has failed within
a reasonable time to retain counsel reasonably satisfactory to the Indemnified
Person, (iii) the Indemnified Person shall have reasonably concluded that there
may be legal defenses available to it that are different from or in addition
to
those available to the Indemnifying Person or (iv) the named parties in any
such
proceeding (including any impleaded parties) include both the Indemnifying
Person and the Indemnified Person and representation of both parties by the
same
counsel would be inappropriate due to actual or potential differing interests
between them. It is understood and agreed that the Indemnifying
Person shall not, in connection with any proceeding or related proceeding in
the
same jurisdiction, be liable for the fees and expenses of more than one separate
firm (in addition to any local counsel) for all Indemnified Persons and that
all
such fees and expenses shall be reimbursed as they are incurred provided that
the Indemnifying Person shall be reimbursed for such fees and expenses if such
Indemnified Person is not found liable by final non-appealable judgment and
the
Indemnified Person has actually received reimbursement for such fees and
expenses from a third party. Any such separate firm for any Initial
Purchaser, its affiliates, directors and officers and any control persons of
such Initial Purchaser shall be designated in writing by ▇.▇. ▇▇▇▇▇▇ Securities
Ltd. and any such separate firm for the Company, the Guarantors and any control
persons of the Company and the Guarantors shall be designated in writing by
the
Company. The Indemnifying Person shall not be liable for any
settlement of any proceeding effected without its written
consent. Notwithstanding the foregoing sentence, if at any time an
Indemnified Person shall have requested that an Indemnifying Person reimburse
the Indemnified Person for fees and expenses of counsel as contemplated by
this
paragraph, the Indemnifying Person shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 30 days after receipt by the Indemnifying Person of
such
request and (ii) the Indemnifying Person shall not have reimbursed the
Indemnified Person in accordance with such request prior to the date of such
settlement. No Indemnifying Person shall, without the written consent
of the Indemnified Person, effect any settlement of any pending or threatened
proceeding in respect of which any Indemnified Person is a party and
indemnification has been sought hereunder by such Indemnified Person, unless
such settlement (x) includes an unconditional release of such Indemnified
Person, in form and substance reasonably satisfactory to such Indemnified
Person, from all liability on claims that are the subject matter of such
proceeding 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
Person.
21
(d) Contribution. If
the indemnification provided for in paragraphs (a) and (b) above is unavailable
to an Indemnified Person or insufficient in respect of any losses, claims,
damages or liabilities referred to therein, then each Indemnifying Person under
such paragraph, in lieu of indemnifying such Indemnified Person thereunder,
shall contribute to the amount paid or payable by such Indemnified Person as
a
result of such losses, claims, damages or liabilities (i) in such proportion
as
is appropriate to reflect the relative benefits received by the Company and
the
Guarantors on the one hand and the Initial Purchasers on the other from the
offering of the Notes or (ii) if the allocation provided by clause (i) is not
permitted by applicable law, in such proportion as is appropriate to reflect
not
only the relative benefits referred to in clause (i) but also the relative
fault
of the Company and the Guarantors on the one hand and the Initial Purchasers
on
the other in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company and the
Guarantors on the one hand and the Initial Purchasers on the other shall be
deemed to be in the same respective proportions as the net proceeds (before
deducting expenses) received by the Company from the sale of the Notes and
the
total discounts and commissions received by the Initial Purchasers in connection
therewith, as provided in this Agreement, bear to the aggregate offering price
of the Notes. The relative fault of the Company and the Guarantors on
the one hand and the Initial Purchasers on the other 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 information supplied by the Company or any Guarantor or by the
Initial Purchasers and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission.
(e) Limitation
on Liability. The Company, the Guarantors and the Initial
Purchasers agree that it would not be just and equitable if contribution
pursuant to this Section 0 were 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 account of the equitable
considerations referred to in paragraph (d) above. The amount paid or
payable by an Indemnified Person as a result of the losses, claims, damages
and
liabilities referred to in paragraph (d) above shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses incurred
by such Indemnified Person in connection with any such action or
claim. Notwithstanding the provisions of this Section 0, in no event
shall an Initial Purchaser 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 offering of the Notes exceeds the amount of any
damages that such Initial Purchaser has otherwise been required to pay by reason
of such 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 pursuant to
this Section 0 are several in proportion to their respective purchase
obligations hereunder and not joint.
22
(f)
Non-Exclusive Remedies. The remedies provided for in this
Section 0 are not exclusive and shall not limit any rights or remedies that
may
otherwise be available to any Indemnified Person at law or in
equity.
8. Termination. This
Agreement may be terminated in the absolute discretion of the Representative,
by
notice to the Company, if after the execution and delivery of this Agreement
and
prior to the Closing Date (i) trading generally shall have been suspended or
materially limited on the New York Stock Exchange and the London 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 U.S. Federal or New
York State authorities or by the competent governmental or regulatory
authorities in the United Kingdom, (iv) there shall have occurred any outbreak
or escalation of hostilities or acts of terrorism or any change in financial
markets or any calamity, crisis, or emergency either within or outside the
United States that, in the judgment of the Representative, is material and
adverse and makes it impracticable or inadvisable to proceed with the offering,
sale or delivery of the Notes on the terms and in the manner contemplated by
this Agreement, the Time of Sale Information and the Offering Memorandum, (v)
exchange controls shall have been imposed by the United States or the United
Kingdom or (vi) the representation in Section 0 is incorrect.
9. Defaulting
Initial Purchaser. (c) If, on the Closing Date, any
Initial Purchaser defaults on its obligation to purchase the Notes that it
has
agreed to purchase hereunder, the non-defaulting Initial Purchasers may in
their
discretion arrange for the purchase of such Notes by other persons satisfactory
to the Company on the terms contained in this Agreement. If, within
36 hours after any such default by any Initial Purchaser, the non-defaulting
Initial Purchasers do not arrange for the purchase of such Notes, then the
Company shall be entitled to a further period of 36 hours within which to
procure other persons satisfactory to the non-defaulting Initial Purchasers
to
purchase such Notes on such terms. If other persons become obligated
or agree to purchase the Notes of a defaulting Initial Purchaser, either the
non-defaulting Initial Purchasers or the Company may postpone the Closing Date
for up to five 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. As used in this
Agreement, the term “Initial Purchaser” includes, for all purposes of this
Agreement unless the context otherwise requires, any person not listed in
Schedule 1 hereto that, pursuant to this Section (c), purchases Notes that
a
defaulting Initial Purchaser agreed but failed to purchase.
(b) If,
after giving effect to any arrangements for the purchase of the Notes of a
defaulting Initial Purchaser or Initial Purchasers by the non-defaulting Initial
Purchasers and the Company as provided in paragraph (a) above, the aggregate
principal amount of such Notes that remains unpurchased does not exceed
one-eleventh of the aggregate principal amount of all the Notes, then the
Company shall have the right to require each non-defaulting Initial Purchaser
to
purchase the principal amount of Notes that such Initial Purchaser agreed to
purchase hereunder plus such Initial Purchaser's pro rata share (based
on the principal amount of Notes that such Initial Purchaser agreed to purchase
hereunder) of the Notes of such defaulting Initial Purchaser or Initial
Purchasers for which such arrangements have not been made.
(c) If,
after giving effect to any arrangements for the purchase of the Notes of a
defaulting Initial Purchaser or Initial Purchasers by the non-defaulting Initial
Purchasers and the Company as provided in paragraph (a) above, the aggregate
principal amount of such Notes that remains unpurchased exceeds one-eleventh
of
the aggregate principal amount of all the Notes, or if the Company shall not
exercise the right described in paragraph (b) above, then this Agreement shall
terminate without liability on the part of the non-defaulting Initial
Purchasers. Any termination of this Agreement pursuant to this
Section (c) shall be without liability on the part of the Company or the
Guarantors, except that the Company and each of the Guarantors will continue
to
be liable for the payment of expenses as set forth in Section (d) hereof and
except that the provisions of Section 0 hereof shall not terminate and shall
remain in effect.
23
(d) 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.
10. Payment
of Expenses. (d) Whether or not the transactions
contemplated by this Agreement are consummated or this Agreement is terminated,
the Company and each of the Guarantors jointly and severally agree to pay or
cause to be paid all costs and expenses (together with any value added tax
thereon) incidental to the performance of their respective obligations
hereunder, including without limitation, (i) the costs incidental to the
authorization, issuance, sale, preparation and delivery of the Notes and any
taxes payable in that connection; (ii) the costs incidental to the preparation
and printing of the Preliminary Offering Memorandum, any other Time of Sale
Information and the Offering Memorandum (including any amendment or supplement
thereto) and the distribution thereof; (iii) the costs of reproducing and
distributing each of the Transaction Documents; (iv) the fees and expenses
of
the Company’s and the Guarantors’ and the Initial Purchasers’ respective legal
counsel (provided that the Company shall not pay or cause to be paid legal
fees
of counsel to Initial Purchasers in excess of €350,000) and all external
accountants; (v) the fees and expenses incurred in connection with the
registration or qualification and determination of eligibility for investment
of
the Notes under the laws of such jurisdictions as the Representative may
designate and the preparation, printing and distribution of a Blue Sky
Memorandum (including the related fees and expenses of counsel for the Initial
Purchasers); (vi) any fees charged by rating agencies for rating the Notes
and
all fees and expenses relating to the rating agency process, including those
incident to making presentations to the rating agencies; (vii) the fees and
expenses of the Trustee, the Security Agent and any paying agent (including
related fees and expenses of any counsel to such parties); (viii) all expenses
and application fees incurred in connection with the application for the Notes’
eligibility for clearance and settlement through Euroclear and Clearstream;
(ix)
all expenses incurred by the Company, the Guarantors and the Initial Purchasers
in connection with any “road show” presentation to potential investors; (x) all
expenses and application fees related to the listing of the Notes on the
Exchange; (xi) the costs of preparing certificates evidencing the Notes; (xii)
the fees and expenses of any Authorized Agent (as defined in Section (e)
hereof); (xiii) the costs and charges of any transfer agent or registrar; (xiv)
all stamp or other issuance or transfer taxes or governmental duties, if any,
payable by the Initial Purchasers in connection with the offer and sale of
the
Notes to the Initial Purchasers and resales by the Initial Purchasers to the
purchasers thereof; (xv) all out-of-pocket costs and expenses incurred by the
Initial Purchasers in connection with this Agreement and the transactions
contemplated hereby (including reasonable fees and other charges of professional
advisors subject to the cap on legal fees set out in Section (d)(d)(iv)) not
otherwise specifically provided for herein; and (xvi) all other costs and
expenses incident to the performance by the Company and the Guarantors of their
respective obligations under this Agreement and the Transaction Documents,
whether or not otherwise specifically provided for in this Section.
(b) If
(i) this Agreement is terminated pursuant to Section 0, (ii) the Company for
any
reason fails to tender the Notes for delivery to the Initial Purchasers or
(iii)
the Initial Purchasers decline to purchase the Notes for any reason permitted
under this Agreement, the Company and each of the Guarantors jointly and
severally agree to reimburse the Initial Purchasers for all out-of-pocket costs
and expenses (including the fees and expenses of their counsel) reasonably
incurred by the Initial Purchasers in connection with this Agreement and the
offering contemplated hereby.
24
11. Persons
Entitled to Benefit of Agreement. This Agreement shall inure to
the benefit of and be binding upon the parties hereto and their respective
successors and any controlling persons referred to herein, and the affiliates,
officers and directors of each Initial Purchaser referred to in Section 0
hereof. Nothing in this Agreement is intended or shall be construed
to give any other person any legal or equitable right, remedy or claim under
or
in respect of this Agreement or any provision contained herein. No
purchaser of Notes from any Initial Purchaser shall be deemed to be a successor
merely by reason of such purchase.
12. Survival. The
respective indemnities, rights of contribution, representations, warranties
and
agreements of the Company, the Guarantors and the Initial Purchasers contained
in this Agreement or made by or on behalf of the Company, 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 Notes and
shall remain in full force and effect, regardless of any termination of this
Agreement or any investigation made by or on behalf of the Company, the
Guarantors or the Initial Purchasers.
Certain
Defined Terms. For purposes of this Agreement, (a) except where
otherwise expressly provided, the term “affiliate” has the meaning set
forth in Rule 405 under the Securities Act; (b) the term “business day”
means a day (other than a Saturday or a Sunday) on which banks are
open for
general business in London and New York that is also a day
on which the Trans-European Automated Real-time Gross Settlement Express
Transfer (“TARGET”) payment system is open for the settlement of payments
in euro; (c) the term “Exchange Act” means the U.S. Securities Exchange
Act of 1934, as amended; (d) the term “subsidiary” has the meaning set forth in
Rule 405 under the Securities Act; and (e) the term “significant
subsidiary” has the meaning set forth in Rule 1-02 of Regulation S-X under
the Exchange Act.
13. Miscellaneous. (e) Authority
of the Representative. 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.
(b) Notices. All
notices and other communications hereunder shall be in writing and shall be
deemed to have been duly given if mailed or transmitted and confirmed by any
standard form of telecommunication. Notices to the Initial Purchasers
shall be given to the Representative c/o ▇.▇. ▇▇▇▇▇▇ Securities Ltd., ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ (fax: ▇▇▇ (▇) ▇▇▇ ▇▇▇ ▇▇▇▇; Attention:
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇); with a copy to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP,
CityPoint, One ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ (fax:
▇▇▇ (▇) ▇▇▇ ▇▇▇ ▇▇▇▇; Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
Esq. Notices to the Company and the Guarantors shall be given to them
in care of CME Development Corporation, Aldwych House, ▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇, ▇▇▇▇▇▇▇, (fax: ▇▇▇ (▇) ▇▇▇ ▇▇▇ ▇▇▇▇); Attention: ▇▇▇▇▇▇ ▇▇▇▇, Esq.; with
a
copy to ▇▇▇▇▇▇ ▇▇▇▇▇▇ Rosenman LLP, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇,
▇▇▇
(fax: ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇); Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
(c) Governing
Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
(d) Submission
to Jurisdiction. The Company and each of the Guarantors
irrevocably submit to the non-exclusive jurisdiction of any U.S. Federal or
New
York State court in the Borough of Manhattan in the City, County and State
of
New York, United States of America, in any legal suit, action or proceeding
based on or arising under this Agreement and agrees that all claims in respect
of such suit or proceeding may be determined in any such court. The
Company and each of the Guarantors irrevocably waive the defense of an
inconvenient forum or objections to personal jurisdiction with respect to the
maintenance of such legal suit, action or proceeding. To the extent
permitted by law, the Company and each of the Guarantors hereby waive any
objections to the enforcement by any competent court in Bermuda, the Netherlands
and the Netherlands Antilles of any judgment validly obtained in any such court
in New York on the basis of any such legal suit, action or
proceeding. The Company and each of the Guarantors have appointed CT
Corporation System (the “Authorized Agent”) as their authorized agent
upon whom process may be served in any such legal suit, action or
proceeding. Such appointment shall be irrevocable. The
Authorized Agent has agreed to act as said agent for service of process and
the
Company and each of the Guarantors agree to take any and all action, including
the filing of any and all documents and instruments that may be necessary to
continue such appointment in full force and effect as aforesaid. The
Company and each of the Guarantors further agree that service of process upon
the Authorized Agent and written notice of said service to the Company and
the
Guarantors shall be deemed in every respect effective service of process upon
the Company and the Guarantors in any such legal suit, action or
proceeding. Nothing herein shall affect the right of any Initial
Purchaser or any person controlling any Initial Purchaser to serve process
in
any other manner permitted by law. The provisions of this Section
(e)0 are intended to be effective upon the execution of this Agreement without
any further action by the Company or any of the Guarantors and the introduction
of a true copy of this Agreement into evidence shall be conclusive and final
evidence as to such matters.
25
(e) Waiver
of Immunity. To the extent the Company or any of the Guarantors
or any of their respective properties, assets or revenues may have or may
hereafter become entitled to, or have attributed to it, any right of immunity,
on the grounds of sovereignty or otherwise, from any legal action, suit or
proceeding, from the giving of any relief in any such legal action, suit or
proceeding, from set-off or counterclaim, from the competent jurisdiction of
any
court, from service of process, from attachment upon or prior to judgment,
from
attachment in aid of execution of judgment, or from execution of judgment,
or
other legal process or proceeding for the giving of any relief or for the
enforcement of any judgment, in any competent jurisdiction in which proceedings
may at any time be commenced, with respect to its obligations, liabilities
or
any other matter under or arising out of or in connection with this Agreement,
any of the Transaction Documents or any of the transactions contemplated hereby
or thereby, the Company and each of the Guarantors hereby irrevocably and
unconditionally waive, and agree not to plead or claim, any such immunity and
consent to such relief and enforcement.
(f) Currency. Any
payment on account of an amount that is payable to the Initial Purchasers in
a
particular currency (the “Required Currency”) that is paid to or for the
account of the Initial Purchasers in lawful currency of any other jurisdiction
(the “Other Currency”), whether as a result of any judgment or order or
the enforcement thereof or the liquidation of the Company or any Guarantor
or
for any other reason shall constitute a discharge of the obligation of such
obligor only to the extent of the amount of the Required Currency which the
recipient could purchase in the New York or London foreign exchange markets
with
the amount of the Other Currency in accordance with normal banking procedures
at
the rate of exchange prevailing on the first day (other than a Saturday or
Sunday) on which banks in New York or London are generally open for business
following receipt of the payment first referred to above. If the
amount of the Required Currency that could be so purchased (net of all premiums
and costs of exchange payable in connection with the conversion) is less than
the amount of the Required Currency originally due to the recipient, then the
Company and each of the Guarantors shall jointly and severally indemnify and
hold harmless the recipient from and against all loss or damage arising out
of
or as a result of such deficiency. This indemnity shall constitute an
obligation separate and independent from the other obligations of the Company
and each of the Guarantors, shall give rise to a separate and independent cause
of action, shall apply irrespective of any indulgence granted by any person
owed
such obligation from time to time and shall continue in full force and effect
notwithstanding any judgment or order for a liquidated sum in respect of an
amount due hereunder or any judgment or order.
26
(g) Counterparts. This
Agreement may be signed in counterparts (which may include counterparts
delivered by any standard form of telecommunication), each of which shall be
an
original and all of which together shall constitute one and the same
instrument.
(h) Amendments
or Waivers. 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.
(i) Headings. The
headings herein are included for convenience of reference only and are not
intended to be part of, or to affect the meaning or interpretation of, this
Agreement.
[Remainder
of page intentionally left blank]
27
If
the
foregoing is in accordance with your understanding, please indicate your
acceptance of this Agreement by signing in the space provided
below.
|
Very
truly yours,
|
||
|
By
|
/s/
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
|
|
|
Title:
|
Chief
Financial Officer
|
|
|
Name:
|
▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
|
|
|
Central
European Media Enterprises N.V.
|
||
|
By
|
/s/
▇▇▇▇ ▇▇▇▇▇▇
|
|
|
Title:
|
Managing
Director
|
|
|
Name:
|
▇▇▇▇
▇▇▇▇▇▇
|
|
|
CME
Media Enterprises B.V.
|
||
|
By
|
/s/
▇▇▇▇▇▇▇ van Spaendonck
|
|
|
Title:
|
Managing
Director
|
|
|
Name:
|
▇▇▇▇▇▇▇
van Spaendonck
|
|
|
By
|
/s/
Henk van Wijlen
|
|
|
Title:
|
Managing
Director
|
|
|
Name:
|
Pan-Invest
B.V., represented by Henk
van Wijlen
|
|
28
|
Accepted:
May 9, 2007
|
||
|
▇.▇.
▇▇▇▇▇▇ SECURITIES LTD.
|
||
|
By:
|
/s/
▇▇▇▇▇▇ Reicherstorfer
|
|
|
Authorized
Signatory
|
||
|
▇▇▇▇▇▇
BROTHERS INTERNATIONAL (EUROPE)
|
||
|
By:
|
/s/
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
|
|
|
Authorized
Signatory
|
||
|
ING
BANK N.V., LONDON BRANCH
|
||
|
By:
|
/s/
Martijn Bruins
|
|
|
Authorized
Signatory
|
||
|
By:
|
/s/
▇▇▇▇ ▇’▇▇▇▇▇▇
|
|
|
Authorized
Signatory
|
||
29
Schedule
1
|
Initial
Purchasers
|
Principal
Amount
|
Purchase
Price
|
|||||||
|
▇.▇.
▇▇▇▇▇▇ Securities Ltd.
|
€ |
50,000,000
|
€ |
49,330,000
|
|||||
|
▇▇▇▇▇▇
Brothers International (Europe)
|
€ |
50,000,000
|
€ |
49,250,000
|
|||||
|
ING
Bank N.V., London Branch
|
€ |
50,000,000
|
€ |
49,250,000
|
|||||
|
Total
|
€ |
150,000,000
|
€ |
147,830,000
|
|||||
30
Schedule 2
Subsidiaries
of the Company
|
Company
|
Jurisdiction
of Organization
|
|
Media
Pro International S.A.
|
Romania
|
|
Media
Vision SRL
|
Romania
|
|
MPI
Romania B.V.
|
Netherlands
|
|
Mediapro
B.V.
|
Netherlands
|
|
Pro
TV S.A.
|
Romania
|
|
Media
Pro Management S.A.
|
Romania
|
|
Sport
Radio TV Media SRL
|
Romania
|
|
International
Media Services Ltd.
|
Bermuda
|
|
Innova
Film GmbH
|
Germany
|
|
Enterprise
“Inter-Media”
|
Ukraine
|
|
Ukrainian
Media Services LLC
|
Ukraine
|
|
Ukrpromtorg-2003
LLC
|
Ukraine
|
|
Nart
LLC
|
Ukraine
|
|
TV
Stimul LLC
|
Ukraine
|
|
Gravis
LLC
|
Ukraine
|
|
Delta
JSC
|
Ukraine
|
|
TV
Media Planet Ltd.
|
Cyprus
|
|
Broadcasting
Company “Studio 1+1”
|
Ukraine
|
|
A.R.J.
a.s.
|
Slovak
Republic
|
|
Markiza-Slovakia,
spol. s r.o.
|
Slovak
Republic
|
|
Gamatex
spol. s r.o.
|
Slovak
Republic
|
|
▇.▇.▇.▇.
a.s.
|
▇▇▇▇▇▇
▇▇▇▇▇▇▇▇
|
|
▇▇
▇▇ ▇ ▇.▇.▇.
|
▇▇▇▇▇▇▇▇
|
|
Produkcija
Plus d.o.o.
|
Slovenia
|
|
POP
TV d.o.o.
|
Slovenia
|
|
Kanal
A d.o.o.
|
Slovenia
|
|
MTC
Holding d.o.o.
|
Slovenia
|
|
Euro
3 TV d.o.o.
|
Slovenia
|
|
Nova
TV d.d.
|
Croatia
|
|
Operativna
Kompanija d.o.o.
|
Croatia
|
|
Media
House d.o.o.
|
Croatia
|
|
CME
Media Enterprises B.V.
|
Netherlands
|
|
CME
Czech Republic II B.V.
|
Netherlands
|
|
CME
Romania B.V.
|
Netherlands
|
|
CME
Ukraine Holding GmbH
|
Austria
|
|
CME
Cyprus Holding Ltd.
|
Cyprus
|
|
CME
Development Corporation
|
USA
|
|
Central
European Media Enterprises N.V.
|
Netherlands
Antilles
|
|
Central
European Media Enterprises II B.V.
|
Netherlands
Antilles
|
|
CME
Media Investments s r.o.
|
Czech
Republic
|
|
VILJA
a.s.
|
Czech
Republic
|
|
CET
21 spol. s r.o.
|
Czech
Republic
|
|
▇▇▇▇▇
a.s.
|
Czech
Republic
|
|
MEDIA
CAPITOL a.s.
|
Czech
Republic
|
|
NOVA-V.I.P.
a.s.
|
Czech
Republic
|
|
HARTIC
a.s.
|
Czech
Republic
|
|
Galaxie
sport s r.o.
|
Czech
Republic
|
|
CME
SR d.o.o.
|
Serbia
|
31
Annex
A
Restrictions
on Offers and Sales Outside the United States
In
connection with offers and sales of Notes outside the United
States:
(a) Each
Initial Purchaser acknowledges that the Notes have not been registered under
the
Securities Act and may not be offered or sold within the United States or to,
or
for the account or benefit of, U.S. persons except pursuant to an exemption
from, or in transactions not subject to, the registration requirements of the
Securities Act.
(b) Each
Initial Purchaser, severally and not jointly, represents, warrants and agrees
that:
(i) Such
Initial Purchaser has offered and sold the Notes, and will offer and sell the
Notes, (A) as part of their distribution at any time and (B) otherwise until
40
days after the later of the commencement of the offering of the Notes and the
Closing Date, only in accordance with Regulation S under the Securities Act
(“Regulation S”) or Rule 144A or any other available exemption from
registration under the Securities Act.
(ii) None
of such Initial Purchaser or any of its affiliates or any other person acting
on
its or their behalf has engaged or will engage in any directed selling efforts
with respect to the Notes, and all such persons have complied and will comply
with the offering restrictions requirement of Regulation S.
(iii) At
or prior to the confirmation of sale of any Notes sold in reliance on Regulation
S, such Initial Purchaser will have sent to each distributor, dealer or other
person receiving a selling concession, fee or other remuneration that purchase
Notes from it during the distribution compliance period a confirmation or notice
to substantially the following effect:
“The
Notes covered hereby have not been registered under the U.S. Securities Act
of
1933, as amended (the “Securities Act”), and may not be offered or sold
within the United States or to, or for the account or benefit of, U.S. persons
(i) as part of their distribution at any time or (ii) otherwise until 40 days
after the later of the commencement of the offering of the Notes and the date
of
original issuance of the Notes, except in accordance with Regulation S or Rule
144A or any other available exemption from registration under the Securities
Act. Terms used above have the meanings given to them by Regulation
S.”
(iv) Such
Initial Purchaser has not and will not enter into any contractual arrangement
with any distributor with respect to the distribution of the Notes, except
with
its affiliates or with the prior written consent of the Company.
Terms
used in paragraph (a) and this paragraph (b) and not otherwise defined in this
Agreement have the meanings given to them by Regulation S.
(c) Each
Initial Purchaser, severally and not jointly, represents, warrants and agrees
that:
(i) it
has not offered or sold and, prior to the date six months after the Closing
Date, will not offer or sell any Notes to persons in the United Kingdom 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);
32
(ii) it
has only communicated or caused to be communicated and will only communicate
or
cause to be communicated any 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 any Notes in circumstances in which Section
21(1) of the FSMA does not apply to the Company or the Guarantors;
and
(iii) it
has complied and will comply with all applicable provisions of the FSMA with
respect to anything done by it in relation to the Notes in, from or otherwise
involving the United Kingdom.
(d) Each
Initial Purchaser acknowledges that no action has been or will be taken by
the
Company that would permit a public offering of the Notes, or possession or
distribution of the Preliminary Offering Memorandum, the Offering Memorandum
or
any other offering or publicity material relating to the Notes, in any country
or jurisdiction where action for that purpose is required.
33
Annex
B
34