CONSOLIDATED PRODUCTS, INC.
500 Century Building
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As of September 27, 1995
The Prudential Insurance Company
of America ("PRUDENTIAL")
Each Prudential Affiliate (as hereinafter
defined) which becomes bound by certain
provisions of this Agreement as hereinafter
provided (together with Prudential, the "PURCHASERS")
c/o Prudential Capital Group
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Ladies and Gentlemen:
The undersigned, Consolidated Products, Inc. (herein called the "COMPANY"),
hereby agrees with you as follows:
1. AUTHORIZATION OF ISSUE OF NOTES.
1A. AUTHORIZATION OF ISSUE OF SERIES A NOTES. The Company will authorize
the issue of its senior promissory notes (the "SERIES A NOTES") in the aggregate
principal amount of $14,250,000, to be dated the date of issue thereof, to
mature October 31, 1997, to bear interest on the unpaid balance thereof from the
date thereof until the principal thereof shall have become due and payable at
the rate of 12.44% per annum and on overdue principal, Yield-Maintenance Amount
and interest at the rate specified therein, and to be substantially in the form
of EXHIBIT A-1 attached hereto. The terms "SERIES A NOTE" and "SERIES A NOTES"
as used herein shall include each Series A Note delivered pursuant to any
provision of this Agreement and each Series A Note delivered in substitution or
exchange for any such Series A Note pursuant to any such provision.
1B. AUTHORIZATION OF ISSUE OF SERIES B NOTES. The Company will authorize
the issue of its senior promissory notes (the "SERIES B NOTES") in the aggregate
principal amount of $10,000,000, to be dated the date of issue thereof, to
mature September 27, 2005, to bear interest on the unpaid balance thereof from
the date thereof until the principal thereof shall have become due and payable
at the rate of 7.70% per annum and on overdue principal, Yield-Maintenance
Amount and interest at the rate specified therein, and to be substantially in
the form of EXHIBIT A-2 attached hereto. The terms "SERIES B NOTE" and "SERIES
B NOTES" as used herein shall include each Series B Note delivered pursuant to
any provision of this Agreement and each
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Series B Note delivered in substitution or exchange for any such Series B Note
pursuant to any such provision.
1C. AUTHORIZATION OF ISSUE OF SERIES C NOTES. The Company will authorize
the issue of its senior promissory notes (the "SERIES C NOTES") in the aggregate
principal amount of $5,000,000, to be dated the date of issue thereof, to mature
September 27, 2005, to bear interest on the unpaid balance thereof from the date
thereof until the principal thereof shall have become due and payable at the
rate of 7.40% per annum and on overdue principal, Yield-Maintenance Amount and
interest at the rate specified therein, and to be substantially in the form of
EXHIBIT A-3 attached hereto. The terms "SERIES C NOTE" and "SERIES C NOTES" as
used herein shall include each Series C Note delivered pursuant to any provision
of this Agreement and each Series C Note delivered in substitution or exchange
for any such Series C Note pursuant to any such provision.
1D. AUTHORIZATION OF ISSUE OF SHELF NOTES. The Company will
authorize the issue of its additional senior promissory notes (the "SHELF
NOTES") in the aggregate principal amount of $10,000,000, to be dated the date
of issue thereof, to mature, in the case of each Shelf Note so issued, no less
than three and more than ten years after the date of original issuance thereof,
to have an average life, in the case of each Shelf Note so issued, of no more
than eight years after the date of original issuance thereof, to bear interest
on the unpaid balance thereof from the date thereof at the rate per annum, and
to have such other particular terms, as shall be set forth, in the case of each
Shelf Note so issued, in the Confirmation of Acceptance with respect to such
Shelf Note delivered pursuant to paragraph 2B(5), and to be substantially in the
form of EXHIBIT A-4 attached hereto. The terms "SHELF NOTE" and "SHELF NOTES"
as used herein shall include each Shelf Note delivered pursuant to any provision
of this Agreement and each Shelf Note delivered in substitution or exchange for
any such Shelf Note pursuant to any such provision. The terms "NOTE" and
"NOTES" as used herein shall include each Series A Note, each Series B Note,
each Series C Note and each Shelf Note delivered pursuant to any provision of
this Agreement and each Note delivered in substitution or exchange for any such
Note pursuant to any such provision. Notes which have (i) the same final
maturity, (ii) the same principal prepayment dates, (iii) the same principal
prepayment amounts (as a percentage of the original principal amount of each
Note), (iv) the same interest rate, (v) the same interest payment periods and
(vi) the same date of issuance (which, in the case of a Note issued in exchange
for another Note, shall be deemed for these purposes the date on which such
Note's ultimate predecessor Note was issued), are herein called a "SERIES" of
Notes.
2. PURCHASE AND SALE OF NOTES.
2A. PURCHASE AND SALE OF SERIES A, B AND C NOTES.
2A(1). PURCHASE AND SALE OF SERIES A NOTES. The Company's Subsidiary,
Steak N Shake, Inc. ("Steak N Shake") has issued and outstanding its 12.44%
Senior Note due October 31, 1997 in the original principal amount of $23,750,000
(the "Steak N Shake Note") of which $14,250,000 in principal amount is currently
outstanding. The Steak N Shake Note is guaranteed by the Company and was issued
to Prudential on November 27, 1990, pursuant to the note agreement among Steak N
Shake, the Company and Prudential dated as of November 1, 1990.
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The Company hereby agrees to sell to Prudential, and subject to the terms and
conditions herein set forth, Prudential agrees to purchase from the Company,
$14,250,000 aggregate principal amount of Series A Notes, which sale and
purchase shall be effected through delivery by Prudential to the Company of the
Steak N Shake Note, together with an assignment thereof. On September 27, 1995
or any other date prior to September 27, 1995, upon which Prudential and the
Company may agree (the "Original Closing Day"), the Company will deliver to
Prudential at the offices of Prudential Capital Group, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, a Series A Note in the principal amount of
$14,250,000, against delivery by Prudential of the Steak N Shake Note, together
with an assignment thereof.
2A(2). PURCHASE AND SALE OF SERIES B NOTES. The Company hereby agrees
to sell to Prudential and, subject to the terms and conditions herein set forth,
Prudential agrees to purchase from the Company the aggregate principal amount of
Series B Notes set forth opposite its name on the Purchaser Schedule attached
hereto at 100% of such aggregate principal amount. On the Original Closing Day,
the Company will deliver to Prudential at the offices of Prudential Capital
Group, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, one or more
Series B Notes registered in its name, evidencing the aggregate principal amount
of Series B Notes to be purchased by Prudential and in the denomination or
denominations specified with respect to Prudential in the Purchaser Schedule
attached hereto, against payment of the purchase price thereof by transfer of
immediately available funds for credit to the Company's account #▇▇▇▇▇▇▇ at Bank
One Indianapolis, N.A., Indianapolis, IN, ABA Routing Number ▇▇▇▇▇▇▇▇▇.
2A(3). PURCHASE AND SALE OF SERIES C NOTES. The Company hereby agrees
to sell to Prudential and subject to the terms and conditions herein set forth,
Prudential agrees to purchase from the Company the aggregate principal amount of
Series C Notes set forth opposite its name on the Purchaser Schedule attached
hereto at 100% of such aggregate principal amount. On October 31, 1995 or any
other date prior to November 15, 1995 upon which the Company and Prudential may
agree (herein called the "Series C Closing Day"), the Company will deliver to
Prudential at the offices of Prudential Capital Group, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, one or more Series C Notes registered in
its name, evidencing the aggregate principal amount of Series C Notes to be
purchased by Prudential and in the denomination or denominations specified with
respect to Prudential in the Purchaser Schedule attached hereto, against payment
of the purchase price thereof by transfer of immediately available funds for
credit to the Company's account ▇▇▇▇▇▇▇ at Bank One Indianapolis, N.A,
Indianapolis, IN, ABA Routing Number ▇▇▇▇▇▇▇▇▇.
2B. PURCHASE AND SALE OF SHELF NOTES.
2B(1). FACILITY. Prudential is willing to consider, in its sole
discretion and within limits which may be authorized for purchase by Prudential
and Prudential Affiliates from time to time, the purchase of Shelf Notes
pursuant to this Agreement. The willingness of Prudential to consider such
purchase of Shelf Notes is herein called the "FACILITY". At any time, the
aggregate principal amount of Shelf Notes stated in paragraph 1D, MINUS the
aggregate principal amount of Shelf Notes purchased and sold pursuant to this
Agreement prior to such time, MINUS the aggregate principal amount of Accepted
Notes (as hereinafter defined) which have not yet been
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purchased and sold hereunder prior to such time, is herein called the "AVAILABLE
FACILITY AMOUNT" at such time. NOTWITHSTANDING THE WILLINGNESS OF PRUDENTIAL TO
CONSIDER PURCHASES OF SHELF NOTES, THIS AGREEMENT IS ENTERED INTO ON THE EXPRESS
UNDERSTANDING THAT NEITHER PRUDENTIAL NOR ANY PRUDENTIAL AFFILIATE SHALL BE
OBLIGATED TO MAKE OR ACCEPT OFFERS TO PURCHASE SHELF NOTES, OR TO QUOTE RATES,
SPREADS OR OTHER TERMS WITH RESPECT TO SPECIFIC PURCHASES OF SHELF NOTES, AND
THE FACILITY SHALL IN NO WAY BE CONSTRUED AS A COMMITMENT BY PRUDENTIAL OR ANY
PRUDENTIAL AFFILIATE.
2B(2). ISSUANCE PERIOD. Shelf Notes may be issued and sold pursuant to
this Agreement until the earlier of (i) the third anniversary of the date of
this Agreement (or if any such anniversary is not a Business Day, the Business
Day next preceding such anniversary) and (ii) the thirtieth day after Prudential
shall have given to the Company, or the Company shall have given to Prudential,
written notice stating that it elects to terminate the issuance and sale of
Shelf Notes pursuant to this Agreement (or if such thirtieth day is not a
Business Day, the Business Day next preceding such thirtieth day). The period
during which Shelf Notes may be issued and sold pursuant to this Agreement is
herein called the "ISSUANCE PERIOD".
2B(3). REQUEST FOR PURCHASE. The Company may from time to time during
the Issuance Period make requests for purchases of Shelf Notes (each such
request being herein called a "REQUEST FOR PURCHASE"). Each Request for
Purchase shall be made to Prudential by telecopier or overnight delivery
service, and shall (i) specify the aggregate principal amount of Shelf Notes
covered thereby, which shall not be less than $5,000,000 and not be greater than
the Available Facility Amount at the time such Request for Purchase is made,
(ii) specify the principal amounts, final maturities, principal prepayment dates
and amounts and interest payment periods (quarterly or semi-annual in arrears)
of the Shelf Notes covered thereby, (iii) specify the use of proceeds of such
Shelf Notes, (iv) specify the proposed day for the closing of the purchase and
sale of such Shelf Notes, which shall be a Business Day during the Issuance
Period not less than 10 days and not more than 25 days after the making of such
Request for Purchase, (v) specify the number of the account and the name and
address of the depository institution to which the purchase prices of such Shelf
Notes are to be transferred on the Closing Day for such purchase and sale, (vi)
certify that the representations and warranties contained in paragraph 8 are
true on and as of the date of such Request for Purchase and that there exists on
the date of such Request for Purchase no Event of Default or Default, (vii)
specify whether the fee to be due pursuant to paragraph 2B(8)(ii) should be
included in the rate quotes Prudential may provide pursuant to paragraph 2B(4)
or will be paid separately by the Company on the Closing Day for such purchase
and sale, (viii) specify the Designated Spread for such Shelf Notes and (ix) be
substantially in the form of EXHIBIT B attached hereto. Each Request for
Purchase shall be in writing and shall be deemed made when received by
Prudential.
2B(4). RATE QUOTES. Not later than five Business Days after the Company
shall have given Prudential a Request for Purchase pursuant to paragraph 2B(3),
Prudential may, but shall be under no obligation to, provide to the Company by
telephone or telecopier, in each case between 9:30 A.M. and 1:30 P.M. New York
City local time (or such later time as Prudential may elect)
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interest rate quotes for the several principal amounts, maturities, principal
prepayment schedules, and interest payment periods of Shelf Notes specified in
such Request for Purchase. Each quote shall represent the interest rate per
annum payable on the outstanding principal balance of such Shelf Notes at which
Prudential or a Prudential Affiliate would be willing to purchase such Shelf
Notes at 100% of the principal amount thereof.
2B(5). ACCEPTANCE. Within 30 minutes after Prudential shall have
provided any interest rate quotes pursuant to paragraph 2B(4) or such shorter
period as Prudential may specify to the Company (such period herein called the
"ACCEPTANCE WINDOW"), the Company may, subject to paragraph 2B(6), elect to
accept such interest rate quotes as to not less than $5,000,000 aggregate
principal amount of the Shelf Notes specified in the related Request for
Purchase. Such election shall be made by an Authorized Officer of the Company
notifying Prudential by telephone or telecopier within the Acceptance Window
that the Company elects to accept such interest rate quotes, specifying the
Shelf Notes (each such Shelf Note being herein called an "ACCEPTED NOTE") as to
which such acceptance (herein called an "ACCEPTANCE") relates. The day the
Company notifies an Acceptance with respect to any Accepted Notes is herein
called the "ACCEPTANCE DAY" for such Accepted Notes. Any interest rate quotes
as to which Prudential does not receive an Acceptance within the Acceptance
Window shall expire, and no purchase or sale of Shelf Notes hereunder shall be
made based on such expired interest rate quotes. Subject to paragraph 2B(6) and
the other terms and conditions hereof, the Company agrees to sell to Prudential
or a Prudential Affiliate, and Prudential agrees to purchase, or to cause the
purchase by a Prudential Affiliate of, the Accepted Notes at 100% of the
principal amount of such Notes. As soon as practicable following the Acceptance
Day, the Company, Prudential and each Prudential Affiliate which is to purchase
any such Accepted Notes will execute a confirmation of such Acceptance
substantially in the form of EXHIBIT C attached hereto (herein called a
"CONFIRMATION OF ACCEPTANCE"). If the Company should fail to execute and return
to Prudential within three Business Days following receipt thereof a
Confirmation of Acceptance with respect to any Accepted Notes, Prudential may at
its election at any time prior to its receipt thereof cancel the closing with
respect to such Accepted Notes by so notifying the Company in writing.
2B(6). MARKET DISRUPTION. Notwithstanding the provisions of paragraph
2B(5), if Prudential shall have provided interest rate quotes pursuant to
paragraph 2B(4) and thereafter prior to the time an Acceptance with respect to
such quotes shall have been notified to Prudential in accordance with paragraph
2B(5) the domestic market for U.S. Treasury securities or derivatives shall have
closed or there shall have occurred a general suspension, material limitation,
or significant disruption of trading in securities generally on the New York
Stock Exchange or in the domestic market for U.S. Treasury securities or
derivatives, then such interest rate quotes shall expire, and no purchase or
sale of Shelf Notes hereunder shall be made based on such expired interest rate
quotes. If the Company thereafter notifies Prudential of the Acceptance of any
such interest rate quotes, such Acceptance shall be ineffective for all purposes
of this Agreement, and Prudential shall promptly notify the Company that the
provisions of this paragraph 2B(6) are applicable with respect to such
Acceptance.
2B(7). FACILITY CLOSINGS. Not later than 11:30 A.M. (New York City
local time) on the Closing Day for any Accepted Notes, the Company will deliver
to each Purchaser listed in the
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Confirmation of Acceptance relating thereto at the offices of the Prudential
Capital Group, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇,
the Accepted Notes to be purchased by such Purchaser in the form of one or more
Notes in authorized denominations as such Purchaser may request for each Series
of Accepted Notes to be purchased on the Closing Day, dated the Closing Day and
registered in such Purchaser's name (or in the name of its nominee), against
payment of the purchase price thereof by transfer of immediately available funds
for credit to the Company's account specified in the Request for Purchase of
such Notes. If the Company fails to tender to any Purchaser the Accepted Notes
to be purchased by such Purchaser on the scheduled Closing Day for such Accepted
Notes as provided above in this paragraph 2B(7), or any of the conditions
specified in paragraph 3 shall not have been fulfilled by the time required on
such scheduled Closing Day, the Company shall, prior to 1:00 P.M., New York City
local time, on such scheduled Closing Day notify Prudential (which notification
shall be deemed received by each Purchaser) in writing whether (i) such closing
is to be rescheduled (such rescheduled date to be a Business Day during the
Issuance Period not less than one Business Day and not more than 10 Business
Days after such scheduled Closing Day (the "RESCHEDULED CLOSING DAY") and
certify to Prudential (which certification shall be for the benefit of each
Purchaser) that the Company reasonably believes that it will be able to comply
with the conditions set forth in paragraph 3 on such Rescheduled Closing Day and
that the Company will pay the Delayed Delivery Fee in accordance with paragraph
2B(8)(iii) or (ii) such closing is to be canceled. In the event that the
Company shall fail to give such notice referred to in the preceding sentence,
Prudential (on behalf of each Purchaser) may at its election, at any time after
1:00 P.M., New York City local time, on such scheduled Closing Day, notify the
Company in writing that such closing is to be canceled. Notwithstanding
anything to the contrary appearing in this Agreement, the Company may not elect
to reschedule a closing with respect to any given Accepted Notes on more than
one occasion, unless Prudential shall have otherwise consented in writing.
2B(8). FEES.
2B(8)(i). FACILITY FEE. In consideration for the time, effort and
expense involved in the structuring of this transaction and the preparation,
negotiation and execution of this Agreement, at the time of the execution and
delivery of this Agreement by the Company and Prudential, the Company will pay
to Prudential in immediately available funds a fee (the "FACILITY FEE") in the
amount of $50,000.
2B(8)(ii). ISSUANCE FEE. The Company will pay to Prudential in
immediately available funds a fee (herein called the "ISSUANCE FEE") on each
Closing Day (other than the Original Closing Day and the Series C Closing Day)
in an amount equal to 0.15% of the aggregate principal amount of Notes sold on
such Closing Day, unless the Company shall have requested pursuant to the
applicable Request for Purchase that such fee be included in the rate quotes
Prudential may provide pursuant to paragraph 2B(4).
2B(8)(iii). DELAYED DELIVERY FEE. If the closing of the purchase and sale
of any Accepted Note or Series C Note is delayed for any reason beyond the
original Closing Day for such Accepted Note or Series C Note, the Company will
pay to Prudential (a) on the Cancellation Date or actual closing date of such
purchase and sale and (b) if earlier, the next Business Day
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following 90 days after the Acceptance Day for such Accepted Note and on each
Business Day following 90 days after the prior payment hereunder, a fee (herein
called the "DELAYED DELIVERY FEE") calculated as follows:
(BEY - MMY) X DTS/360 X PA
where "BEY" means Bond Equivalent Yield, I.E., the bond equivalent yield per
annum of such Accepted Note or Series C Note; "MMY" means Money Market Yield,
I.E., the yield per annum on a commercial paper investment of the highest
quality selected by Prudential on the date Prudential receives notice of the
delay in the closing for such Accepted Note or Series C Note having a maturity
date or dates the same as, or closest to, the Rescheduled Closing Day or
Rescheduled Closing Days (a new alternative investment being selected by
Prudential each time such closing is delayed); "DTS" means Days to Settlement,
I.E., the number of actual days elapsed from and including the original Closing
Day with respect to such Accepted Note or Series C Note (in the case of the
first such payment with respect to such Accepted Note or Series C Note) or from
and including the date of the next preceding payment (in the case of any
subsequent delayed delivery fee payment with respect to such Accepted Note or
Series C Note) to but excluding the date of such payment; and "PA" means
Principal Amount, I.E., the principal amount of the Accepted Note or Series C
Note for which such calculation is being made. In no case shall the Delayed
Delivery Fee be less than zero. Nothing contained herein shall obligate any
Purchaser to purchase any Accepted Note or Series C Note on any day other than
the Closing Day for such Accepted Note or Series C Note.
2B(8)(iv). CANCELLATION FEE. If the Company at any time notifies
Prudential in writing that the Company is canceling the closing of the purchase
and sale of any Accepted Note or Series C Note, or if Prudential notifies the
Company in writing under the circumstances set forth in the last sentence of
paragraph 2B(5) or the penultimate sentence of paragraph 2B(7) that the closing
of the purchase and sale of such Accepted Note or Series C Note is to be
canceled, or if the closing of the purchase and sale of such Accepted Note or
Series C Note is not consummated on or prior to the last day of the Issuance
Period (the date of any such notification, or the last day of the Issuance
Period, as the case may be, being herein called the "CANCELLATION DATE"), the
Company will pay to Prudential in immediately available funds an amount (the
"CANCELLATION FEE") calculated as follows:
PI X PA
where "PI" means Price Increase, I.E., the quotient (expressed in decimals)
obtained by dividing (a) the excess of the ask price (as determined by
Prudential) of the Hedge Treasury Note(s) on the Cancellation Date over the bid
price (as determined by Prudential) of the Hedge Treasury Notes(s) on the
Acceptance Day for such Accepted Note or on the date of rate lock for such
Series C Note (as the case may be) by (b) such bid price; and "PA" has the
meaning ascribed to it in paragraph 2B(8)(iii). The foregoing bid and ask
prices shall be as reported by Telerate Systems, Inc. (or, if such data for any
reason ceases to be available through Telerate Systems, Inc., any publicly
available source of similar market data). Each price shall be based on a U.S.
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Treasury security having a par value of $100.00 and shall be rounded to the
second decimal place. In no case shall the Cancellation Fee be less than zero.
3. CONDITIONS OF CLOSING. The obligation of any Purchaser to
purchase and pay for any Notes is subject to the satisfaction, on or before the
Closing Day for such Notes, of the following conditions:
3A. CERTAIN DOCUMENTS. Such Purchaser shall have received the
following, each dated the date of the applicable Closing Day:
(i) The Note(s) to be purchased by such Purchaser.
(ii) Certified copies of the resolutions of the Board of
Directors of the Company authorizing the execution and delivery of this
Agreement and the issuance of the Notes, and of all documents evidencing
other necessary corporate action and governmental approvals, if any, with
respect to this Agreement and the Notes.
(iii) A certificate of the Secretary or an Assistant Secretary and
one other officer of the Company certifying the names and true signatures
of the officers of the Company authorized to sign this Agreement and the
Notes and the other documents to be delivered hereunder.
(iv) Certified copies of the Certificate of Incorporation and By-
laws of the Company.
(v) A favorable opinion of ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇, General Counsel of
the Company (or such other counsel designated by the Company and acceptable
to the Purchaser(s)) satisfactory to such Purchaser and substantially in
the form of EXHIBIT D-1 (in the case of the Series A and Series B Notes),
EXHIBIT D-2 (in the case of the Series C Notes) or EXHIBIT D-3 (in the case
of any Shelf Notes) attached hereto and as to such other matters as such
Purchaser may reasonably request. The Company hereby directs each such
counsel to deliver such opinion, agrees that the issuance and sale of any
Notes will constitute a reconfirmation of such direction, and understands
and agrees that each Purchaser receiving such an opinion will and is hereby
authorized to rely on such opinion.
(vi) A good standing certificate for the Company from the
Secretary of State of Indiana dated of a recent date and such other
evidence of the status of the Company as such Purchaser may reasonably
request.
(vii) Certified copies of Requests for Information or Copies (Form
UCC-11) or equivalent reports listing all effective financing statements
which name the Company, Steak N Shake, SNS Investment Company or
Consolidated Specialty Restaurants, Inc. (in each case, under its present
name and previous names) as debtor and which are filed in the offices of
the Secretaries of State of Ohio, Illinois, Indiana, Florida, Kentucky,
Iowa, Arkansas, Georgia and Kansas, together with copies of such financing
statements.
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(viii) Additional documents or certificates with respect to legal
matters or corporate or other proceedings related to the transactions
contemplated hereby as may be reasonably requested by such Purchaser.
3B. OPINION OF PURCHASER'S SPECIAL COUNSEL. Such Purchaser shall
have received from ▇▇▇▇▇ ▇. ▇▇▇▇▇, Assistant General Counsel of Prudential, or
such other counsel who is acting as special counsel for it in connection with
this transaction, a favorable opinion satisfactory to such Purchaser as to such
matters incident to the matters herein contemplated as it may reasonably
request.
3C. REPRESENTATIONS AND WARRANTIES; NO DEFAULT. The representations
and warranties contained in paragraph 8 shall be true on and as of such Closing
Day, except to the extent of changes caused by the transactions herein
contemplated; there shall exist on such Closing Day no Event of Default or
Default; and the Company shall have delivered to such Purchaser an Officer's
Certificate, dated such Closing Day, to both such effects.
3D. PURCHASE PERMITTED BY APPLICABLE LAWS. The purchase of and
payment for the Notes to be purchased by such Purchaser on the terms and
conditions herein provided (including the use of the proceeds of such Notes by
the Company) shall not violate any applicable law or governmental regulation
(including, without limitation, Section 5 of the Securities Act or Regulation G,
T or X of the Board of Governors of the Federal Reserve System) and shall not
subject such Purchaser to any tax, penalty, liability or other onerous condition
under or pursuant to any applicable law or governmental regulation, and such
Purchaser shall have received such certificates or other evidence as it may
request to establish compliance with this condition.
3E. PAYMENT OF FEES. The Company shall have paid to Prudential any
fees due it pursuant to or in connection with this Agreement, including any
Facility Fee due pursuant to paragraph 2B(8)(i), any Issuance Fee due pursuant
to paragraph 2B(8)(ii) and any Delayed Delivery Fee due pursuant to paragraph
2B(8)(iii).
3F. MODIFICATION OF BANK AGREEMENT. The Company shall have delivered
to Prudential prior to the Original Closing Day a fully executed amendment to
the Bank Agreement pursuant to which all guarantees of the debt issued
thereunder have been terminated.
4. PREPAYMENTS. The Notes shall be subject to required prepayment
as and to the extent provided in paragraphs 4A and 4B, respectively. The Notes
shall also be subject to prepayment under the circumstances set forth in
paragraph 4C. Any prepayment made by the Company pursuant to any other
provision of this paragraph 4 shall not reduce or otherwise affect its
obligation to make any required prepayment as specified in paragraph 4A or 4B.
4A(1). REQUIRED PREPAYMENTS OF SERIES A NOTES. Until the Series A Notes
shall be paid in full, the Company shall apply to the prepayment of the Series A
Notes, without Yield-Maintenance Amount, the sum of $4,250,000 on October 31,
1995 and the sum of $5,000,000 on October 31, 1996, and such principal amounts
of the Series A Notes, together with interest
11
thereon to the payment dates, shall become due on such payment dates. The
remaining unpaid principal amount of the Series A Notes, together with interest
accrued thereon, shall become due on the maturity date of the Series A Notes.
4A(2). REQUIRED PREPAYMENTS OF SERIES B NOTES. Until the Series B Notes
shall be paid in full, the Company shall apply to the prepayment of the Series B
Notes, without Yield-Maintenance Amount, the sum of (i) $433,333.33 on September
27 of the years 1997 and 1998, (ii) $945,238.09 on September 27 of the years
1999 and 2000, (iii) $1,261,904.76 on September 27 of the years 2001 and 2002,
and (iv) $1,428,571.43 on September 27 of the years 2003 and 2004, and such
principal amounts of the Series B Notes, together with interest thereon to the
payment dates, shall become due on such payment dates. The remaining unpaid
principal amount of the Series B Notes, together with interest accrued thereon,
shall become due on the maturity date of the Series B Notes.
4A(3). REQUIRED PREPAYMENTS OF SERIES C NOTES. Until the Series C Notes
shall be paid in full, the Company shall apply to the prepayment of the Series C
Notes, without Yield-Maintenance Amount, the sum of (i) $305,555.56 on September
27 of the years 1997 and 1998, (ii) $360,555.56 on September 27 of the years
1999 and 2000, (iii) $555,555.56 on September 27 of the years 2001 and 2002,
and (iv) $750,555.56 on September 27 of the years 2003 and 2004, and such
principal amounts of the Series C Notes, together with interest thereon to the
payment dates, shall become due on such payment dates. The remaining unpaid
principal amount of the Series C Notes, together with interest accrued thereon,
shall become due on the maturity date of the Series C Notes.
4B. REQUIRED PREPAYMENTS OF SHELF NOTES. Each Series of Shelf Notes
shall be subject to required prepayments, if any, set forth in the Notes of such
Series.
4C. OPTIONAL PREPAYMENT WITH YIELD-MAINTENANCE AMOUNT. The Notes of
each Series shall be subject to prepayment, in whole at any time or from time to
time in part (in integral multiples of $100,000 and in a minimum amount of
$5,000,000), at the option of the Company, at 100% of the principal amount so
prepaid plus interest thereon to the prepayment date and the Yield-Maintenance
Amount, if any, with respect to each such Note. Any partial prepayment of a
Series of the Notes pursuant to this paragraph 4C shall be applied in
satisfaction of required payments of principal in inverse order of their
scheduled due dates.
4D. NOTICE OF OPTIONAL PREPAYMENT. The Company shall give the holder
of each Note of a Series to be prepaid pursuant to paragraph 4C irrevocable
written notice of such prepayment not less than 10 Business Days prior to the
prepayment date, specifying such prepayment date, the aggregate principal amount
of the Notes of such Series to be prepaid on such date, the principal amount of
the Notes of such Series held by such holder to be prepaid on that date and that
such prepayment is to be made pursuant to paragraph 4C. Notice of prepayment
having been given as aforesaid, the principal amount of the Notes specified in
such notice, together with interest thereon to the prepayment date and together
with the Yield-Maintenance Amount, if any, herein provided, shall become due and
payable on such prepayment date. The Company shall, on or before the day on
which it gives written notice of any
12
prepayment pursuant to paragraph 4C, give telephonic notice of the principal
amount of the Notes to be prepaid and the prepayment date to each Significant
Holder which shall have designated a recipient for such notices in the Purchaser
Schedule attached hereto or the applicable Confirmation of Acceptance or by
notice in writing to the Company.
4E. APPLICATION OF PREPAYMENTS. In the case of each prepayment of
less than the entire unpaid principal amount of all outstanding Notes of any
Series pursuant to paragraphs 4A, 4B or 4C, the amount to be prepaid shall be
applied pro rata to all outstanding Notes of such Series (including, for the
purpose of this paragraph 4E only, all Notes prepaid or otherwise retired or
purchased or otherwise acquired by the Company or any of its Subsidiaries or
Affiliates other than by prepayment pursuant to paragraph 4A, 4B or 4C)
according to the respective unpaid principal amounts thereof.
4F. RETIREMENT OF NOTES. The Company shall not, and shall not permit
any of its Subsidiaries or Affiliates to, prepay or otherwise retire in whole or
in part prior to their stated final maturity (other than by prepayment pursuant
to paragraphs 4A, 4B or 4C, prepayment upon the exercise of a put pursuant to
paragraph 5G or upon acceleration of such final maturity pursuant to paragraph
7A), or purchase or otherwise acquire, directly or indirectly, Notes of any
Series held by any holder unless the Company or such Subsidiary or Affiliate
shall have offered to prepay or otherwise retire or purchase or otherwise
acquire, as the case may be, the same proportion of the aggregate principal
amount of Notes of such Series held by each other holder of Notes of such Series
at the time outstanding upon the same terms and conditions. Any Notes so
prepaid or otherwise retired or purchased or otherwise acquired by the Company
or any of its Subsidiaries or Affiliates shall not be deemed to be outstanding
for any purpose under this Agreement, EXCEPT as provided in paragraph 4E.
5. AFFIRMATIVE COVENANTS. During the Issuance Period and so long
thereafter as any Note is outstanding and unpaid, the Company covenants as
follows:
5A. FINANCIAL STATEMENTS; NOTICE OF DEFAULTS. The Company covenants
that it will deliver to each Significant Holder in triplicate:
() as soon as practicable and in any event within 60 days after the
end of each quarterly period (other than the last quarterly period) in each
fiscal year, consolidating and consolidated statements of income and cash
flows and a consolidated statement of shareholders' equity of the Company
and its Subsidiaries for the period from the beginning of the current
fiscal year to the end of such quarterly period, and a consolidating and
consolidated balance sheet of the Company and its Subsidiaries as at the
end of such quarterly period, setting forth in each case in comparative
form figures for the corresponding period in the preceding fiscal year, all
in reasonable detail and certified by an authorized financial officer of
the Company, subject to changes resulting from year-end adjustments;
(i) as soon as practicable and in any event within 90 days after the
end of each fiscal year, consolidating and consolidated statements of
income and cash flows and a
13
consolidated statement of shareholders' equity of the Company and its
Subsidiaries for such year, and a consolidating and consolidated balance sheet
of the Company and its Subsidiaries as at the end of such year, setting forth in
each case in comparative form corresponding consolidated figures from the
preceding annual audit, all in reasonable detail and satisfactory in form to the
Required Holder(s) and, as to the consolidated statements, reported on by
independent public accountants of recognized national standing selected by the
Company whose report shall be without limitation as to scope of the audit and
satisfactory in substance to the Required Holder(s) and, as to the consolidating
statements, certified by an authorized financial officer of the Company;
(ii) promptly upon transmission thereof, copies of all such financial
statements, proxy statements, notices and reports as it shall send to its
public stockholders and copies of all registration statements (without
exhibits) and all reports which it files with the Securities and Exchange
Commission (or any governmental body or agency succeeding to the functions
of the Securities and Exchange Commission);
(iii) promptly upon receipt thereof, a copy of each other report
submitted to the Company or any Subsidiary by independent accountants in
connection with any annual, interim or special audit made by them of the
books of the Company or any Subsidiary; and
(iv) with reasonable promptness, such other financial data as such
holder may reasonably request.
Together with each delivery of financial statements required by clauses (i) and
(ii) above, the Company will deliver to each Significant Holder an Officer's
Certificate demonstrating (with computations in reasonable detail) compliance by
the Company and its Subsidiaries with the provisions of paragraphs 6A, 6C(2),
6C(3), 6C(4), 6C(6), 6C(8) and stating that there exists no Event of Default or
Default, or, if any Event of Default or Default exists, specifying the nature
and period of existence thereof and what action the Company proposes to take
with respect thereto. Together with each delivery of financial statements
required by clause (ii) above, the Company will deliver to each Significant
Holder a certificate of such accountants stating that, in making the audit
necessary for their report on such financial statements, they have obtained no
knowledge of any Event of Default or Default, or, if they have obtained
knowledge of any Event of Default or Default, specifying the nature and period
of existence thereof. Such accountants, however, shall not be liable to anyone
by reason of their failure to obtain knowledge of any Event of Default or
Default which would not be disclosed in the course of an audit conducted in
accordance with generally accepted auditing standards.
The Company also covenants that immediately after any Responsible Officer
obtains knowledge of an Event of Default or Default, it will deliver to each
Significant Holder an Officer's Certificate specifying the nature and period of
existence thereof and what action the Company proposes to take with respect
thereto.
5B. INFORMATION REQUIRED BY RULE 144A. The Company covenants that it
will, upon the request of the holder of any Note, provide such holder, and any
qualified institutional buyer
14
designated by such holder, such financial and other information as such holder
may reasonably determine to be necessary in order to permit compliance with the
information requirements of Rule 144A under the Securities Act in connection
with the resale of Notes, except at such times as the Company is subject to and
in compliance with the reporting requirements of section 13 or 15(d) of the
Exchange Act. For the purpose of this paragraph 5B, the term "QUALIFIED
INSTITUTIONAL BUYER" shall have the meaning specified in Rule 144A under the
Securities Act.
5C. INSPECTION OF PROPERTY. The Company covenants that it will
permit any Person designated by any Significant Holder in writing, at such
Significant Holder's expense, to visit and inspect any of the properties of the
Company and its Subsidiaries, to examine the corporate books and financial
records of the Company and its Subsidiaries and make copies thereof or extracts
therefrom and to discuss the affairs, finances and accounts of any of such
corporations with the principal officers of the Company and its independent
public accountants, all at such reasonable times and as often as such
Significant Holder may reasonably request.
5D. COVENANT TO SECURE NOTES EQUALLY. The Company covenants that, if
it or any Subsidiary shall create or assume any Lien upon any of its property or
assets, whether now owned or hereafter acquired, other than Liens permitted by
the provisions of paragraph 6C(1) (unless prior written consent to the creation
or assumption thereof shall have been obtained pursuant to paragraph 11C), it
will make or cause to be made effective provision whereby the Notes will be
secured by such Lien equally and ratably with any and all other Debt thereby
secured so long as any such other Debt shall be so secured.
5E. MAINTENANCE OF INSURANCE. The Company covenants that it and each
Subsidiary will maintain, with financially sound and reputable insurers,
insurance in such amounts and against such liabilities and hazards as
customarily is maintained by other companies operating similar businesses.
Together with each delivery of financial statements under paragraph 5A, the
Company will, upon the request of any Significant Holder, deliver an Officer's
Certificate specifying the details of such insurance in effect.
5F. COMPLIANCE WITH ENVIRONMENTAL LAWS. The Company covenants that
it will, and will cause each of the Subsidiaries to, comply in a timely fashion
with, or operate pursuant to valid waivers of the provisions of, all
Environmental Laws, except where noncompliance would not materially and
adversely affect the business, condition (financial or otherwise) or operations
of the Company and the Subsidiaries taken as a whole.
5G. CHANGE IN CONTROL PUT OPTION. The Company covenants that within
three Business Days after any Responsible Officer shall obtain knowledge of the
occurrence of a Change in Control Event, the Company shall provide each holder
of Notes written notice thereof, describing in reasonable detail the facts and
circumstances constituting such Change in Control Event. Following the
occurrence of any Change in Control Event, if at any time prior to 15 Business
Days after receipt of notice thereof, the holder of any Note requests in writing
that the Company purchase the Note(s) held by such holder, the Company shall, on
the 20th Business Day after such receipt of such notice, purchase (and each such
holder thereof shall sell) such Note(s) at a purchase price equal to the
aggregate outstanding principal amount thereof, together with
15
interest thereon to the date of purchase and the Yield Maintenance Amount, if
any, with respect thereto. Each Purchaser of a Note hereby irrevocably
relinquishes for itself, but not for any subsequent holder of such Note, the
right to sell its Note pursuant to this paragraph 5G unless either (i) on or
after the earlier of the date upon which (a) the Change of Control Event is
first publicly announced or (b) the Change of Control Event occurs, and within
one year after such date, (i) the aggregate amount of all Debt of the Company
and its Subsidiaries permitted by clauses (iii), (iv), and (iv) of paragraph
6C(2) is greater than or equal to 45% of Consolidated Tangible Capitalization,
or (ii) any other holder of Notes makes a request to have any Note purchased by
the Company pursuant to this paragraph 5G, in which event such Purchaser may
request that the Company purchase the Notes held by such Purchaser pursuant to
this paragraph 5G at any time prior to 5 Business Days after receipt by such
Purchaser of notice of the occurrence of an event described in clause (i) or
(ii). The Company agrees to notify in writing the holders of the Notes
promptly, but in any event within 2 Business Days, following the occurrence of
an event described in clause (i) or (ii).
No holder of any Note to be sold pursuant to this paragraph 5G shall be required
to make any representation or warranty in connection with such sale, other than
with respect to its ownership of its Note.
6. NEGATIVE COVENANTS. During the Issuance Period and so long
thereafter as any Note or other amount due hereunder is outstanding and unpaid,
the Company covenants as follows:
6A. DEBT SERVICE COVERAGE RATIO. The Company will not permit the
Debt Service Coverage Ratio to be less than (i) 1.00 to 1.00 at any time prior
to April 10, 1996 or (ii) 1.25 to 1.00 at any time thereafter.
6B. ISSUANCE OF STOCK BY SUBSIDIARIES. The Company covenants that it
will not permit any Subsidiary to issue, sell or dispose of any shares of its
stock of any class except to the Company or a Wholly-Owned Subsidiary, and
except to the extent that holders of minority interests may be entitled to
purchase stock by reason of preemptive rights and except that any Subsidiary
which does not own any shares of stock of any other Subsidiary may issue to
Persons other than the Company or another Subsidiary shares of stock of a class
which has no priority over any other class as to dividends or in liquidation if,
after giving effect thereto, the issuing corporation shall continue to be a
Subsidiary and no Default or Event of Default would exist.
6C. LIEN, DEBT AND OTHER RESTRICTIONS. The Company will not and will
not permit any Subsidiary to:
6C(1). LIENS. Create, assume or suffer to exist any Lien upon any of
its properties or assets, whether now owned or hereafter acquired (whether or
not provision is made for the equal and ratable securing of the Notes in
accordance with the provisions of paragraph 5D), EXCEPT:
(i) Liens for taxes not yet due or which are being actively
contested in good faith by appropriate proceedings,
16
(ii) other Liens incidental to the conduct of its business or the
ownership of its property and assets (including workers' compensation
liens, mechanics' liens and materialmens' liens) which do not secure Debt
and which do not in the aggregate materially detract from the value of its
property or assets or materially impair the use thereof in the operation of
its business,
(iii) Liens on property or assets of a Subsidiary to secure
obligations of such Subsidiary to the company or to a Wholly-Owned
Subsidiary,
(iv) Liens securing Debt of Subsidiaries evidenced by Capitalized
Lease Obligations existing on the date hereof and identified on Schedule
6C(1) hereto, and
(v) other Liens securing Debt which is permitted by paragraph 6C(2);
6C(2). DEBT. Create, incur, assume or suffer to exist any Debt, EXCEPT:
(i) Debt of any Subsidiary to the Company or a Wholly-Owned
Subsidiary,
(ii) Debt of the Company to any Wholly-Owned Subsidiary,
(iii) Debt evidenced by the Notes,
(iv) Debt of Subsidiaries evidenced by Capitalized Lease Obligations
existing on the date hereof, in individual principal amounts not in excess
of the amounts outstanding on the date hereof (which principal amounts in
aggregate shall be less than $10,000,000) and as identified on Schedule
6C(1) hereto, and
(v) other Debt of the Company or Subsidiaries, so long as Priority
Debt at no time exceeds 20% of Consolidated Tangible Net Worth;
PROVIDED that the aggregate amount of Debt permitted by clauses (iii), (iv)
and (v) shall not exceed (a) 55% of Consolidated Tangible Capitalization at any
time prior to September 25, 1996 or (b) 50% of Consolidated Tangible
Capitalization at any time on or after September 25, 1996;
6C(3). LOANS, ADVANCES AND INVESTMENTS. Make or permit to remain
outstanding any loan or advance to, or own, purchase or acquire any stock,
obligations or securities of, or any other interest in, or make any capital
contribution to, any Person, EXCEPT:
(i) stock, obligations or securities received in settlement of debts
(created in the ordinary course of business) owing to the Company or any
Subsidiary,
17
(ii) (a) direct obligations of, or obligations guaranteed by, the
United States of America maturing not more than one year from the date of
purchase thereof and (b) investments in commercial paper rated P-1 by
▇▇▇▇▇'▇ Investors Service, Inc. or A-1 by Standard & Poor's Corporation
maturing not more than one year from the date of purchase thereof,
(iii) demand and time deposits with, and certificates of deposit and
banker's acceptances issued by (or repurchase agreements with respect to
the foregoing with), any commercial bank (a) organized under the laws of
Canada, the United States or any of its states and (b) having equity
capital in excess of $100,000,000, in each case (x) payable in the United
States in United States dollars, and (y) which mature within one year from
the date acquired,
(iv) stock, obligations or securities of a Subsidiary or of a
corporation which immediately after such purchase or acquisition will be a
Subsidiary,
(v) travel and other like advances to officers and employees of the
Company or a Subsidiary in the ordinary course of business, and
(vi) other loans, advances and investments, provided that the
aggregate amount thereof, at original cost, at no time exceeds an amount
equal to 15% of Consolidated Tangible Net Worth;
6C(4). SALE OF STOCK AND DEBT OF SUBSIDIARIES. Sell or otherwise
dispose of, or part with control of, any shares of stock or Debt of any
Subsidiary, except (i) to the Company or Wholly-Owned Subsidiary, and (ii) that
all shares of stock and Debt of any Subsidiary at the time owned by or owed to
the Company and all Subsidiaries may be sold as an entirety for a cash
consideration which represents the fair value (as determined in good faith by
the Board of Directors of the Company) at the time of sale of the shares of
stock and Debt so sold; PROVIDED that (a) such sale or other disposition, if
treated as a Transfer of assets of such Subsidiary, would be permitted by
paragraph 6C(6) and (b) at the time of such sale, such Subsidiary shall not own,
directly or indirectly, any shares of stock or Debt of any other Subsidiary
(unless all of the shares of stock and Debt of such other Subsidiary owned,
directly or indirectly, by the Company and all Subsidiaries are simultaneously
being sold as permitted by this paragraph 6C(4));
6C(5). MERGER AND CONSOLIDATION. Merge or consolidate with or into any
other Person, EXCEPT that:
(i) any Subsidiary may merge or consolidate with or into the
Company, PROVIDED that the Company is the continuing or surviving
corporation,
(ii) any Subsidiary may merge or consolidate with or into a Wholly-
Owned Subsidiary, and
18
(iii) the Company may merge with any other solvent corporation, so
long as the Company shall be the continuing or surviving corporation,
PROVIDED that no Default or Event of Default exists or would exist
immediately after giving effect to any such merger;
6C(6). TRANSFER OF ASSETS. Transfer any of its assets EXCEPT that:
(i) the Company and Subsidiaries may sell assets in the ordinary
course of business,
(ii) any Subsidiary may Transfer assets to the Company or a Wholly-
Owned Subsidiary, and
(iii) the Company or any Subsidiary may otherwise Transfer assets,
PROVIDED that after giving effect thereto (a) the Three Year Percentage of
Earnings Capacity Transferred pursuant to this clause (iii) and clause (ii)
of paragraph 6C(4) shall not exceed 10% and (b) the Three Year Percentage
of Assets Transferred pursuant to this clause (iii) and clause (ii) of
paragraph 6C(4) shall not exceed 10%;
6C(7). SALE OR DISCOUNT OF RECEIVABLES. Sell with recourse, or discount
or otherwise sell for less than the face value thereof, or subject to a Lien,
any of its notes or accounts receivable;
6C(8). RELATED PARTY TRANSACTIONS. Directly or indirectly, purchase,
acquire or lease any property from, or sell, transfer or lease any property to,
or otherwise deal with, in the ordinary course of business or otherwise, any
Related Party; PROVIDED that the foregoing shall not prohibit transactions which
are engaged in the ordinary course of business and are on terms demonstrably no
less favorable to the Company or a Subsidiary (as the case may be) than would be
available in an "arm's-length" transaction.
7. EVENTS OF DEFAULT.
7A. ACCELERATION. If any of the following events shall occur and be
continuing for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law or
otherwise):
(i) the Company defaults in the payment of any principal of, or
Yield- Maintenance Amount payable with respect to, any Note when the same
shall become due, either by the terms thereof or otherwise as herein
provided; or
(ii) the Company defaults in the payment of any interest on any Note
for more than 10 days after the date due; or
(iii) the Company or any Subsidiary defaults (whether as primary
obligor or as guarantor or other surety) in any payment of principal of or
interest on any
19
other obligation for money borrowed (or any Capitalized Lease Obligation,
any obligation under a conditional sale or other title retention
agreement, any obligation issued or assumed as full or partial payment
for property whether or not secured by a purchase money mortgage or any
obligation under notes payable or drafts accepted representing
extensions of credit) beyond any period of grace provided with respect
thereto, or the Company or any Subsidiary fails to perform or observe
any other agreement, term or condition contained in any agreement under
which any such obligation is created (or if any other event thereunder
or under any such agreement shall occur and be continuing) and the
effect of such failure or other event is to cause, or to permit the
holder or holders of such obligation (or a trustee on behalf of such
holder or holders) to cause, such obligation to become due (or to be
repurchased by the Company or any Subsidiary) prior to any stated
maturity, PROVIDED that the aggregate amount of all obligations as to
which such a payment default shall occur and be continuing or such a
failure or other event causing or permitting acceleration (or resale to
the Company or any Subsidiary) shall occur and be continuing exceeds
$1,000,000; or
(iv) any representation or warranty made by the Company herein or by
the Company or any of its officers in any writing furnished in connection
with or pursuant to this Agreement shall be false in any material respect
on the date as of which made; or
(v) the Company fails to perform or observe any agreement contained
in paragraph 6; or
(v) the Company fails to perform or observe any other agreement, term
or condition contained herein and such failure shall not be remedied within
30 days after any Responsible Officer obtains actual knowledge thereof; or
(vi) the Company or any Subsidiary makes an assignment for the benefit
of creditors or is generally not paying its debts as such debts become due;
or
(vii) any decree or order for relief in respect of the Company or any
Subsidiary is entered under any bankruptcy, reorganization, compromise,
arrangement, insolvency, readjustment of debt, dissolution or liquidation
or similar law, whether now or hereafter in effect (herein called the
"BANKRUPTCY LAW"), of any jurisdiction; or
(ix) the Company or any Subsidiary petitions or applies to any
tribunal for, or consents to, the appointment of, or taking possession by,
a trustee, receiver, custodian, liquidator or similar official of the
Company or any Subsidiary, or of any substantial part of the assets of the
Company or any Subsidiary, or commences a voluntary case under the
Bankruptcy Law of the United States or any proceedings (other than
proceedings for the voluntary liquidation and dissolution of a Subsidiary)
relating to the Company or any Subsidiary under the Bankruptcy Law of any
other jurisdiction; or
(x) any such petition or application is filed, or any such
proceedings are commenced, against the Company or any Subsidiary and the
Company or such Subsidiary
20
by any act indicates its approval thereof, consent thereto or acquiescence
therein, or an order, judgment or decree is entered appointing any such
trustee, receiver, custodian, liquidator or similar official, or approving
the petition in any such proceedings, and such order, judgment or decree
remains unstayed and in effect for more than 30 days; or
(xi) any order, judgment or decree is entered in any proceedings
against the Company decreeing the dissolution of the Company and such
order, judgment or decree remains unstayed and in effect for more than 60
days: or
(xii) any order, judgment or decree is entered in any proceedings
against the Company or any Subsidiary decreeing a split-up of the Company
or such Subsidiary which requires the divestiture of assets representing a
substantial part, or the divestiture of the stock of a Subsidiary whose
assets represent a substantial part, of the consolidated assets of the
Company and its Subsidiaries (determined in accordance with generally
accepted accounting principles) or which requires the divestiture of
assets, or stock of a Subsidiary, which shall have contributed a
substantial part of the consolidated net income of the Company and its
Subsidiaries (determined in accordance with generally accepted accounting
principles) for any of the three fiscal years then most recently ended, and
such order, judgment or decree remains unstayed and in effect for more than
60 days; or
(xiii) one or more final judgments in an aggregate amount in excess of
$250,000 is rendered against the Company or any Subsidiary and, within 60
days after entry thereof, any such judgment is not discharged or execution
thereof stayed pending appeal, or within 60 days after the expiration of
any such stay, such judgment is not discharged; or
(xiv) the Company or any ERISA Affiliate, in its capacity as an
employer under a Multiemployer Plan, makes a complete or partial withdrawal
from such Multiemployer Plan resulting in the incurrence by such
withdrawing employer of a withdrawal liability in an amount exceeding
$250,000;
then (a) if such event is an Event of Default specified in clause (i) or (ii) of
this paragraph 7A, any holder of any Note may at its option during the
continuance of such Event of Default, by notice in writing to the Company,
declare all of the Notes held by such holder to be, and all of the Notes held by
such holder shall thereupon be and become, immediately due and payable at par
together with interest accrued thereon, without presentment, demand, protest or
notice of any kind, all of which are hereby waived by the Company, (b) if such
event is an Event of Default specified in clause (viii), (ix) or (x) of this
paragraph 7A with respect to the Company, all of the Notes at the time
outstanding shall automatically become immediately due and payable together with
interest accrued thereon and together with the Yield-Maintenance Amount, if any,
with respect to each Note, without presentment, demand, protest or notice of any
kind, all of which are hereby waived by the Company, and (c) with respect to any
event constituting an Event of Default, the Required Holder(s) of the Notes of
any Series may at its or their option during the continuance of such Event of
Default, by notice in writing to the Company, declare all of the Notes of such
Series to be, and all of the Notes of such Series shall thereupon be and become,
immediately due and
21
payable together with interest accrued thereon and together with the Yield-
Maintenance Amount, if any, with respect to each Note of such Series, without
presentment, demand, protest or notice of any kind, all of which are hereby
waived by the Company.
7B. RESCISSION OF ACCELERATION. At any time after any or all of the
Notes of any Series shall have been declared immediately due and payable
pursuant to paragraph 7A, the Required Holder(s) of the Notes of such Series
may, by notice in writing to the Company, rescind and annul such declaration and
its consequences if (i) the Company shall have paid all overdue interest on the
Notes of such Series, the principal of and Yield-Maintenance Amount, if any,
payable with respect to any Notes of such Series which have become due otherwise
than by reason of such declaration, and interest on such overdue interest and
overdue principal and Yield-Maintenance Amount at the rate specified in the
Notes of such Series, (ii) the Company shall not have paid any amounts which
have become due solely by reason of such declaration, (iii) all Events of
Default and Defaults, other than non-payment of amounts which have become due
solely by reason of such declaration, shall have been cured or waived pursuant
to paragraph 11C, and (iv) no judgment or decree shall have been entered for the
payment of any amounts due pursuant to the Notes of such Series or this
Agreement. No such rescission or annulment shall extend to or affect any
subsequent Event of Default or Default or impair any right arising therefrom.
7C. NOTICE OF ACCELERATION OR RESCISSION. Whenever any Note shall be
declared immediately due and payable pursuant to paragraph 7A or any such
declaration shall be rescinded and annulled pursuant to paragraph 7B, the
Company shall forthwith give written notice thereof to the holder of each Note
of each Series at the time outstanding.
7D. OTHER REMEDIES. If any Event of Default or Default shall occur
and be continuing, the holder of any Note may proceed to protect and enforce its
rights under this Agreement and such Note by exercising such remedies as are
available to such holder in respect thereof under applicable law, either by suit
in equity or by action at law, or both, whether for specific performance of any
covenant or other agreement contained in this Agreement or in aid of the
exercise of any power granted in this Agreement. No remedy conferred in this
Agreement upon the holder of any Note is intended to be exclusive of any other
remedy, and each and every such remedy shall be cumulative and shall be in
addition to every other remedy conferred herein or now or hereafter existing at
law or in equity or by statute or otherwise.
8. REPRESENTATIONS, COVENANTS AND WARRANTIES. The Company
represents, covenants and warrants as follows (all references to "Subsidiary"
and "Subsidiaries" in this paragraph 8 shall be deemed omitted if the Company
has no Subsidiaries at the time the representations herein are made or
repeated):
8A. ORGANIZATION; SUBSIDIARY PREFERENCE STOCK. The Company is a
corporation duly organized and existing in good standing under the laws of the
State of Indiana, each Subsidiary is duly organized and existing in good
standing under the laws of the jurisdiction in which it is incorporated, and the
Company has and each Subsidiary has the corporate power to own its respective
property and to carry on its respective business as now being conducted. No
22
Subsidiary has outstanding any shares of stock of a class which has priority
over any other class as to dividends or in liquidation.
8B. FINANCIAL STATEMENTS. The Company has furnished each Purchaser
of the Series A, B and C Notes and any Accepted Notes with the following
financial statements, identified by a principal financial officer of the
Company: (i) consolidating and consolidated balance sheets of the Company and
its Subsidiaries as at the last Wednesday in September in each of the three
fiscal years of the Company most recently completed prior to the date as of
which this representation is made or repeated to such Purchaser (other than
fiscal years completed within 90 days prior to such date for which audited
financial statements have not been released) and consolidating and consolidated
statements of income and cash flows and a consolidated statement of
shareholders' equity of the Company and its Subsidiaries for each such year,
reported on by Ernst & Young LLP in the case of consolidated statements and (ii)
consolidating and consolidated balance sheets of the Company and its
Subsidiaries as at the end of the quarterly period (if any) most recently
completed prior to such date and after the end of such fiscal year (other than
quarterly periods completed within 60 days prior to such date for which
financial statements have not been released) and the comparable quarterly period
in the preceding fiscal year and consolidating and consolidated statements of
income and cash flows and a consolidated statement of shareholders' equity for
the periods from the beginning of the fiscal years in which such quarterly
periods are included to the end of such quarterly periods, prepared by the
Company. Such financial statements (including any related schedules and/or
notes) are true and correct in all material respects (subject, as to interim
statements, to changes resulting from audits and year-end adjustments), have
been prepared in accordance with generally accepted accounting principles
consistently followed throughout the periods involved and show all liabilities,
direct and contingent, of the Company and its Subsidiaries required to be shown
in accordance with such principles. The balance sheets fairly present the
condition of the Company and its Subsidiaries as at the dates thereof, and the
statements of income, stockholders' equity and cash flows fairly present the
results of the operations of the Company and its Subsidiaries and their cash
flows for the periods indicated. There has been no material adverse change in
the business, property or assets, condition (financial or otherwise), operations
or prospects of the Company and its Subsidiaries taken as a whole since the end
of the most recent fiscal year for which such audited financial statements have
been furnished.
8C. ACTIONS PENDING. There is no action, suit, investigation or
proceeding pending or, to the knowledge of the Company, threatened against the
Company or any of its Subsidiaries, or any properties or rights of the Company
or any of its Subsidiaries, by or before any court, arbitrator or administrative
or governmental body which might result in any material adverse change in the
business, property or assets, condition (financial or otherwise) or operations
of the Company and its Subsidiaries taken as a whole.
8D. OUTSTANDING DEBT. Neither the Company nor any of its
Subsidiaries has outstanding any Debt except as permitted by paragraph 6C(2).
There exists no default under the provisions of any instrument evidencing such
Debt or of any agreement relating thereto.
8E. TITLE TO PROPERTIES. The Company has and each of its
Subsidiaries has good and indefeasible title to its respective real properties
(other than properties which it leases)
23
and good title to all of its other respective properties and assets, including
the properties and assets reflected in the most recent audited balance sheet
referred to in paragraph 8B (other than properties and assets disposed of in the
ordinary course of business), subject to no Lien of any kind except Liens
permitted by paragraph 6C(1). All leases necessary in any material respect for
the conduct of the respective businesses of the Company and its Subsidiaries are
valid and subsisting and are in full force and effect.
8F. TAXES. The Company has and each of its Subsidiaries has filed
all federal, state and other income tax returns which, to the best knowledge of
the officers of the Company and its Subsidiaries, are required to be filed, and
each has paid all taxes as shown on such returns and on all assessments received
by it to the extent that such taxes have become due, except such taxes as are
being contested in good faith by appropriate proceedings for which adequate
reserves have been established in accordance with generally accepted accounting
principles.
8G. CONFLICTING AGREEMENTS AND OTHER MATTERS. Neither the Company
nor any of its Subsidiaries is a party to any contract or agreement or subject
to any charter or other corporate restriction which materially and adversely
affects its business, property or assets, condition (financial or otherwise) or
operations. Neither the execution nor delivery of this Agreement or the Notes,
nor the offering, issuance and sale of the Notes, nor fulfillment of nor
compliance with the terms and provisions hereof and of the Notes will conflict
with, or result in a breach of the terms, conditions or provisions of, or
constitute a default under, or result in any violation of, or result in the
creation of any Lien upon any of the properties or assets of the Company or any
of its Subsidiaries pursuant to, the charter or by-laws of the Company or any of
its Subsidiaries, any award of any arbitrator or any agreement (including any
agreement with stockholders), instrument, order, judgment, decree, statute, law,
rule or regulation to which the Company or any of its Subsidiaries is subject.
Neither the Company nor any of its Subsidiaries is a party to, or otherwise
subject to any provision contained in, any instrument evidencing Indebtedness of
the Company or such Subsidiary, any agreement relating thereto or any other
contract or agreement (including its charter) which limits the amount of, or
otherwise imposes restrictions on the incurring of, Debt of the Company of the
type to be evidenced by the Notes except as set forth in the agreements listed
in SCHEDULE 8G attached hereto (as such Schedule 8G may have been modified from
time to time by written supplements thereto delivered by the Company to
Prudential).
8H. OFFERING OF NOTES. Neither the Company nor any agent acting on
its behalf has, directly or indirectly, offered the Notes or any similar
security of the Company for sale to, or solicited any offers to buy the Notes or
any similar security of the Company from, or otherwise approached or negotiated
with respect thereto with, any Person other than institutional investors, and
neither the Company nor any agent acting on its behalf has taken or will take
any action which would subject the issuance or sale of the Notes to the
provisions of Section 5 of the Securities Act or to the provisions of any
securities or Blue Sky law of any applicable jurisdiction.
8I. USE OF PROCEEDS. The proceeds of the Series B Notes will be used
to refinance bank debt and for working capital purposes. The proceeds of the
Series C Notes will be used to fund the principal prepayment due October 31,
1995 with respect to the Series A Notes and for working capital purposes. None
of the proceeds of the sale of any Notes will be used,
24
directly or indirectly, for the purpose, whether immediate, incidental or
ultimate, of purchasing or carrying any "margin stock" as defined in Regulation
G (12 CFR Part 207) of the Board of Governors of the Federal Reserve System
(herein called "MARGIN STOCK") or for the purpose of maintaining, reducing or
retiring any Indebtedness which was originally incurred to purchase or carry any
stock that is then currently a margin stock or for any other purpose which might
constitute the purchase of such Notes a "purpose credit" within the meaning of
such Regulation G, unless the Company shall have delivered to the Purchaser
which is purchasing such Notes, on the Closing Day for such Notes, an opinion of
counsel satisfactory to such Purchaser stating that the purchase of such Notes
does not constitute a violation of such Regulation G. Neither the Company nor
any agent acting on its behalf has taken or will take any action which might
cause this Agreement or the Notes to violate Regulation G, Regulation T or any
other regulation of the Board of Governors of the Federal Reserve System or to
violate the Exchange Act, in each case as in effect now or as the same may
hereafter be in effect.
8J. ERISA. No accumulated funding deficiency (as defined in section
302 of ERISA and section 412 of the Code), whether or not waived, exists with
respect to any Plan (other than a Multiemployer Plan). No liability to the
Pension Benefit Guaranty Corporation has been or is expected by the Company or
any ERISA Affiliate to be incurred with respect to any Plan (other than a
Multiemployer Plan) by the Company, any Subsidiary or any ERISA Affiliate which
is or would be materially adverse to the business, property or assets, condition
(financial or otherwise) or operations of the Company and its Subsidiaries taken
as a whole. Neither the Company, any Subsidiary nor any ERISA Affiliate has
incurred or presently expects to incur any withdrawal liability under Title IV
of ERISA with respect to any Multiemployer Plan which is or would be materially
adverse to the business, property or assets, condition (financial or otherwise)
or operations of the Company and its Subsidiaries taken as a whole. The
execution and delivery of this Agreement and the issuance and sale of the Notes
will be exempt from or will not involve any transaction which is subject to the
prohibitions of section 406 of ERISA and will not involve any transaction in
connection with which a penalty could be imposed under section 502(i) of ERISA
or a tax could be imposed pursuant to section 4975 of the Code. The
representation by the Company in the next preceding sentence is made in reliance
upon and subject to the accuracy of the representation of each Purchaser in
paragraph 9B as to the source of funds to be used by it to purchase any Notes.
8K. GOVERNMENTAL CONSENT. Neither the nature of the Company or of
any Subsidiary, nor any of their respective businesses or properties, nor any
relationship between the Company or any Subsidiary and any other Person, nor any
circumstance in connection with the offering, issuance, sale or delivery of the
Notes is such as to require any authorization, consent, approval, exemption or
any action by or notice to or filing with any court or administrative or
governmental body (other than routine filings after the Closing Day for any
Notes with the Securities and Exchange Commission and/or state Blue Sky
authorities) in connection with the execution and delivery of this Agreement,
the offering, issuance, sale or delivery of the Notes or fulfillment of or
compliance with the terms and provisions hereof or of the Notes.
8L. ENVIRONMENTAL COMPLIANCE. The Company and its Subsidiaries and
all of their respective properties and facilities have complied at all times and
in all respects with all Environmental Laws EXCEPT, in any such case, where
failure to comply would not result in a
25
material adverse effect on the business, condition (financial or otherwise) or
operations of the Company and its Subsidiaries taken as a whole.
8M. REGULATORY STATUS. Neither the Company nor any Subsidiary is (i)
an "Investment company" or a company "controlled" by an "investment company"
within the meaning of the Investment Company Act of 1940, as amended, (ii) a
"holding company" or a "subsidiary company" or an "affiliate" of a "holding
company" or a "subsidiary company" of a "holding company", within the meaning of
the Public Utility Act of 1935, as amended, or (iii) a "public utility" within
the meaning of the Federal Power Act, as amended.
8N. SECTION 144A. The Notes are not of the same class as securities,
if any, of the Company listed on a national securities exchange registered under
Section 6 of the Exchange Act or quoted in a U.S. automated inter-dealer
quotation system.
8O. ABSENCE OF FINANCING STATEMENTS, ETC. Except with respect to
Liens permitted by paragraph 6C(1) hereof, there is no financing statement,
security agreement, chattel mortgage, real estate mortgage or other document
filed or recorded with any filing records, registry or other public office, that
purports to cover, affect or give notice of any present or possible future Lien
on, or security interest in, any assets or property of the Company or any of its
Subsidiaries or any rights relating thereto.
8P. DISCLOSURE. Neither this Agreement nor any other document,
certificate or statement furnished to any Purchaser by or on behalf of the
Company in connection herewith contains any untrue statement of a material fact
or omits to state a material fact necessary in order to make the statements
contained herein and therein not misleading. There is no fact peculiar to the
Company or any of its Subsidiaries which materially adversely affects or in the
future may (so far as the Company can now foresee) materially adversely affect
the business, property or assets, condition (financial or otherwise) or
operations of the Company or any of its Subsidiaries and which has not been set
forth in this Agreement.
8Q. HOSTILE TENDER OFFERS. None of the proceeds of the sale of any
Notes will be used to finance a Hostile Tender Offer.
9. REPRESENTATIONS OF THE PURCHASERS.
Each Purchaser represents as follows:
9A. NATURE OF PURCHASE. Such Purchaser is not acquiring the Notes
purchased by it hereunder with a view to or for sale in connection with any
distribution thereof within the meaning of the Securities Act, provided that the
disposition of such Purchaser's property shall at all times be and remain within
its control.
9B. SOURCE OF FUNDS. The source of the funds being used by such
Purchaser to pay the purchase price of the Notes being purchased by such
Purchaser hereunder constitutes assets allocated to: (i) the "insurance
company general account" of such Purchaser (as such term is defined under
Section V of the United States Department of Labor's Prohibited Transaction
26
Class Exemption ("PTCE") 95-60), and as of the date of the purchase of the Notes
such Purchaser satisfies all of the applicable requirements for relief under
Sections I and IV of PTCE 95-60 or (ii) a separate account maintained by such
Purchaser in which no employee benefit plan, other than employee benefit plans
identified on a list which has been furnished by such Purchaser to the Company,
participates to the extent of 10% or more. For the purpose of this paragraph
9B, the terms "SEPARATE ACCOUNT" and "EMPLOYEE BENEFIT PLAN" shall have the
respective meanings specified in section 3 of ERISA.
10. DEFINITIONS; ACCOUNTING MATTERS. For the purpose of this
Agreement, the terms defined in paragraphs 10A and 10B (or within the text of
any other paragraph) shall have the respective meanings specified therein and
all accounting matters shall be subject to determination as provided in
paragraph 10C.
10A. YIELD-MAINTENANCE TERMS.
"CALLED PRINCIPAL" shall mean, with respect to any Note, the principal of
such Note that is to be prepaid pursuant to paragraph 4C, is put to the Company
pursuant to paragraph 5G or is declared to be immediately due and payable
pursuant to paragraph 7A, as the context requires.
"DESIGNATED SPREAD" shall mean 0% in the case of each Series A, B and C
Note and 0% in the case of each Note of any other Series unless the Confirmation
of Acceptance with respect to the Notes of such Series specifies a different
Designated Spread in which case it shall mean, with respect to each Note of such
Series, the Designated Spread so specified.
"DISCOUNTED VALUE" shall mean, with respect to the Called Principal of any
Note, the amount obtained by discounting all Remaining Scheduled Payments with
respect to such Called Principal from their respective scheduled due dates to
the Settlement Date with respect to such Called Principal, in accordance with
accepted financial practice and at a discount factor (as converted to reflect
the periodic basis on which interest on such Note is payable, if payable other
than on a semi-annual basis) equal to the Reinvestment Yield with respect to
such Called Principal.
"REINVESTMENT YIELD" shall mean, with respect to the Called Principal of
any Note, the Designated Spread over the yield to maturity implied by (i) the
yields reported, as of 10:00 A.M. (New York City local time) on the Business Day
next preceding the Settlement Date with respect to such Called Principal, on the
display designated as "Page 678" on the Telerate Service (or such other display
as may replace page 678 on the Tolerate Service) for actively traded U.S.
Treasury securities having a maturity equal to the Remaining Average Life of
such Called Principal as of such Settlement Date, or if such yields shall not be
reported as of such time or the yields reported as of such time shall not be
ascertainable, (ii) the Treasury Constant Maturity Series yields reported, for
the latest day for which such yields shall have been so reported as of the
Business Day next preceding the Settlement Date with respect to such Called
Principal, in Federal Reserve Statistical Release H.15 (519) (or any comparable
successor publication) for actively traded U.S. Treasury securities having a
constant maturity equal to the Remaining Average Life of such Called Principal
as of such Settlement Date. Such implied yield
27
shall be determined, if necessary, by (a) converting U.S. Treasury ▇▇▇▇
quotations to bond-equivalent yields in accordance with accepted financial
practice and (b) interpolating linearly between yields reported for various
maturities.
"REMAINING AVERAGE LIFE" shall mean, with respect to the Called Principal
of any Note, the number of years (calculated to the nearest one-twelfth year)
obtained by dividing (i) such Called Principal into (ii) the sum of the products
obtained by multiplying (a) each Remaining Scheduled Payment of such Called
Principal (but not of interest thereon) by (b) the number of years (calculated
to the nearest one-twelfth year) which will elapse between the Settlement Date
with respect to such Called Principal and the scheduled due date of such
Remaining Scheduled Payment.
"REMAINING SCHEDULED PAYMENTS" shall mean, with respect to the Called
Principal of any Note, all payments of such Called Principal and interest
thereon that would be due on or after the Settlement Date with respect to such
Called Principal if no payment of such Called Principal were made prior to its
scheduled due date.
"SETTLEMENT DATE" shall mean, with respect to the Called Principal of any
Note, the date on which such Called Principal is to be prepaid pursuant to
paragraph 4C, is put to the Company pursuant to paragraph 5G or is declared to
be immediately due and payable pursuant to paragraph 7A, as the context
requires.
"YIELD-MAINTENANCE AMOUNT" shall mean, with respect to any Note, an amount
equal to the excess, if any, of the Discounted Value of the Called Principal of
such Note over the sum of (i) such Called Principal plus (ii) interest accrued
thereon as of (including interest due on) the Settlement Date with respect to
such Called Principal. The Yield-Maintenance Amount shall in no event be less
than zero.
10B. OTHER TERMS.
"ACCEPTANCE" shall have the meaning specified in paragraph 2B(5).
"ACCEPTANCE DAY" shall have the meaning specified in paragraph 2B(5).
"ACCEPTANCE WINDOW" shall have the meaning specified in paragraph 2B(5).
"ACCEPTED NOTE" shall have the meaning specified in paragraph 2B(5).
"AFFILIATE" shall mean any Person directly or indirectly controlling,
controlled by, or under direct or indirect common control with, the Company,
except a Subsidiary. A Person shall be deemed to control a corporation if such
Person possesses, directly or indirectly, the power to direct or cause the
direction of the management and policies of such corporation, whether through
the ownership of voting securities, by contract or otherwise.
"AUTHORIZED OFFICER" shall mean (i) in the case of the Company, its chief
executive officer, its chief financial officer, any vice president of the
Company designated as an
28
"Authorized Officer" of the Company in the Information Schedule attached hereto
or any vice president of the Company designated as an "Authorized Officer" of
the Company for the purpose of this Agreement in an Officer's Certificate
executed by the Company's chief executive officer or chief financial officer and
delivered to Prudential, and (ii) in the case of Prudential, any officer of
Prudential designated as its "Authorized Officer" in the Information Schedule or
any officer of Prudential designated as its "Authorized Officer" for the purpose
of this Agreement in a certificate executed by one of its Authorized Officers.
Any action taken under this Agreement on behalf of the Company by any individual
who on or after the date of this Agreement shall have been an Authorized Officer
of the Company and whom Prudential in good faith believes to be an Authorized
Officer of the Company at the time of such action shall be binding on the
Company even though such individual shall have ceased to be an Authorized
Officer of the Company, and any action taken under this Agreement on behalf of
Prudential by any individual who on or after the date of this Agreement shall
have been an Authorized Officer of Prudential and whom the Company in good faith
believes to be an Authorized Officer of Prudential at the time of such action
shall be binding on Prudential even though such individual shall have ceased to
be an Authorized Officer of Prudential.
"AVAILABLE FACILITY AMOUNT" shall have the meaning specified in paragraph
2B(1).
"BANK AGREEMENT" shall mean the agreement dated December 30, 1994, between
the Company and Bank One Indianapolis, N.A., as amended from time to time.
"BANKRUPTCY LAW" shall have the meaning specified in clause (viii) of
paragraph 7A.
"BUSINESS DAY" shall mean any day other than (i) a Saturday or a Sunday,
(ii) a day on which commercial banks in New York City are required or authorized
to be closed and (iii) for purposes of paragraph 2B(3) hereof only, a day on
which The Prudential Insurance Company of America is not open for business.
"CANCELLATION DATE" shall have the meaning specified in paragraph
2B(8)(iv).
"CANCELLATION FEE" shall have the meaning specified in paragraph 2B(8)(iv).
"CAPITALIZED LEASE OBLIGATION" shall mean any rental obligation which,
under generally accepted accounting principles, is or will be required to be
capitalized on the books of the Company or any Subsidiary, taken at the amount
thereof accounted for as indebtedness (net of interest expenses) in accordance
with such principles.
"CHANGE IN CONTROL EVENT" shall be deemed to have occurred at such a time
as a "person" or "group" (within the meaning of Section 13(d)(3) or 14(d)(2) of
the Exchange Act) becomes the "beneficial owner" (as defined in Rule 13d-3 under
the Exchange Act) of more than 50% of the Voting Stock of the Company.
29
"CLOSING DAY" shall mean (i) with respect to the Series A and Series B
Notes, the Original Closing Day, (ii) with respect to the Series C Notes, the
Series C Closing Day, and (iii) with respect to any Accepted Note, the Business
Day specified for the closing of the purchase and sale of such Accepted Note in
the Request for Purchase of such Accepted Note, PROVIDED that (i) if the Company
and the Purchaser which is obligated to purchase such Accepted Note agree on an
earlier Business Day for such closing, the "CLOSING DAY" for such Accepted Note
shall be such earlier Business Day, and (ii) if the closing of the purchase and
sale of such Accepted Note is rescheduled pursuant to paragraph 2B(7), the
Closing Day for such Accepted Note, for all purposes of this Agreement except
references to "original Closing Day" in paragraph 2B(8)(iii), shall mean the
Rescheduled Closing Day with respect to such Accepted Note.
"CODE" shall mean the Internal Revenue Code of 1986, as amended.
"CONFIRMATION OF ACCEPTANCE" shall have the meaning specified in paragraph
2B(5).
"CONSOLIDATED ASSETS" shall mean, as of any time of determination thereof,
the total assets of the Company and Subsidiaries determined on a consolidated
basis.
"CONSOLIDATED DEBT" shall mean, as of any time of determination thereof,
the aggregate amount of Debt of the Company and Subsidiaries determined on a
consolidated basis.
"CONSOLIDATED TANGIBLE CAPITALIZATION" shall mean, as of any time of
determination thereof, the sum of Consolidated Tangible Net Worth and
Consolidated Debt at such time.
"CONSOLIDATED TANGIBLE NET WORTH" shall mean, as of any time of
determination thereof, the amount of net worth of the Company and Subsidiaries,
determined on a consolidated basis, less (i) the book value of all Intangibles
and (ii) any net gains or losses attributable to cumulative translation
adjustments.
"CURRENT DEBT" shall mean, with respect to any Person, all Indebtedness of
such Person for borrowed money which by its terms or by the terms of any
instrument or agreement relating thereto matures on demand or within one year
from the date of the creation thereof and is not directly or indirectly
renewable or extendible at the option of the debtor to a date more than one year
from the date of the creation thereof, provided that Indebtedness for borrowed
money outstanding under a revolving credit or similar agreement which obligates
the lender or lenders to extend credit over a period of more than one year shall
constitute Funded Debt and not Current Debt, even though such Indebtedness by
its terms matures on demand or within one year from the date of the creation
thereof.
"DEBT" shall mean Current Debt and Funded Debt.
"DEBT SERVICE COVERAGE RATIO" shall mean the ratio of (i) consolidated net
income of the Company and Subsidiaries plus, to the extent deducted in
determining the same, interest expense and rental expense to (ii) the sum of
interest expense, rental expense and the
30
current portion of Debt, in each case for the period of four consecutive fiscal
quarters (or in the case of the current portion of Debt, as of the last day of
the fiscal quarter) of the Company most recently ended as of any time of
determination.
"DELAYED DELIVERY FEE" shall have the meaning specified in paragraph
2B(8)(iii).
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended.
"ENVIRONMENTAL LAWS" shall mean all federal, state, local and foreign laws
relating to pollution or protection of the environment, including laws relating
to emissions, discharges, releases or threatened releases of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances or wastes
into the environment (including, without limitation, ambient air, surface water,
ground water or land), or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or handling of
pollutants, contaminants, chemicals, or industrial, toxic or hazardous
substances or wastes, and any and all regulations, codes, plans, orders,
decrees, judgments, injunctions, notices or demand letters issued, entered,
promulgated or approved thereunder.
"ERISA AFFILIATE" shall mean any corporation which is a member of the same
controlled group of corporations as the Company within the meaning of section
414(b) of the Code, or any trade or business which is under common control with
the Company within the meaning of section 414(c) of the Code.
"EVENT OF DEFAULT" shall mean any of the events specified in paragraph 7A,
provided that there has been satisfied any requirement in connection with such
event for the giving of notice, or the lapse of time, or the happening of any
further condition, event or act, and "DEFAULT" shall mean any of such events,
whether or not any such requirement has been satisfied.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as amended.
"FACILITY" shall have the meaning specified in paragraph 2B(1).
"FACILITY FEE" shall have the meaning specified in paragraph 2B(8)(i).
"FUNDED DEBT" shall mean with respect to any Person, all Indebtedness of
such Person which by its terms or by the terms of any instrument or agreement
relating thereto matures, or which is otherwise payable or unpaid, more than one
year from, or is directly or indirectly renewable or extendible at the option of
the debtor to a date more than one year (including an option of the debtor under
a revolving credit or similar agreement obligating the lender or lenders to
extend credit over a period of more than one year) from, the date of the
creation thereof.
"GUARANTEE" shall mean, with respect to any Person, any direct or indirect
liability, contingent or otherwise, of such Person with respect to any
indebtedness, lease (excluding operating leases of a Subsidiary of such Person),
dividend or other obligation of another, including, without limitation, any such
obligation directly or indirectly guaranteed,
31
endorsed (otherwise than for collection or deposit in the ordinary course of
business) or discounted or sold with recourse by such Person, or in respect of
which such Person is otherwise directly or indirectly liable, including, without
limitation, any such obligation in effect guaranteed by such Person through any
agreement (contingent or otherwise) to purchase, repurchase or otherwise acquire
such obligation or any security therefor, or to provide funds for the payment or
discharge of such obligation (whether in the form of loans, advances, stock
purchases, capital contributions or otherwise), or to maintain the solvency or
any balance sheet or other financial condition of the obligor of such
obligation, or to make payment for any products, materials or supplies or for
any transportation or service, regardless of the non-delivery or non-furnishing
thereof, in any such case if the purpose or intent of such agreement is to
provide assurance that such obligation will be paid or discharged, or that any
agreements relating thereto will be complied with, or that the holders of such
obligation will be protected against loss in respect thereof. The amount of any
Guarantee shall be equal to the outstanding principal amount of the obligation
guaranteed or such lesser amount to which the maximum exposure of the guarantor
shall have been specifically limited.
"HEDGE TREASURY NOTE(S)" shall mean, with respect to any Accepted Note or
Series C Note, the United States Treasury Note or Notes whose duration (as
determined by Prudential) most closely matches the duration of such Accepted
Note or Series C Note.
"HOSTILE TENDER OFFER" shall mean, with respect to the use of proceeds of
any Note, any offer to purchase, or any purchase of, shares of capital stock of
any corporation or equity interests in any other entity, or securities
convertible into or representing the beneficial ownership of, or rights to
acquire, any such shares or equity interests, if such shares, equity interests,
securities or rights are of a class which is publicly traded on any securities
exchange or in any over-the-counter market, other than purchases of such shares,
equity interests, securities or rights representing less than 5% of the equity
interests or beneficial ownership of such corporation or other entity for
portfolio investment purposes, and such offer or purchase has not been duly
approved by the board of directors of such corporation or the equivalent
governing body of such other entity prior to the date on which the Company makes
the Request for Purchase of such Note.
"INCLUDING" shall mean, unless the context clearly requires otherwise,
"including without limitation".
"INDEBTEDNESS" shall mean, with respect to any Person, without duplication,
(i) all items (excluding items of contingency reserves or of reserves for
deferred income taxes) which in accordance with generally accepted accounting
principles would be included in determining total liabilities as shown on the
liability side of a balance sheet of such Person as of the date on which
Indebtedness is to be determined, (ii) all indebtedness secured by any Lien on
any property or asset owned or held by such Person subject thereto, whether or
not the indebtedness secured thereby shall have been assumed, (iii) all
indebtedness of others with respect to which such Person has become liable by
way of Guarantee and (iv) all Swaps of such Person.
"INTANGIBLES" shall mean any patents, trademarks, copyrights, trade names,
licenses, operating agreements, treasury stock, deferred or capitalized research
and development
32
costs, goodwill (including any amounts, however designated, representing the
cost of acquisition of business and investments in excess of the book value
thereof), unamortized debt discount and expense, deferred research and
development costs, any write-up of asset value after September 28, 1994 and any
other amounts reflected in contra-equity accounts and any other assets treated
as intangible assets in accordance with generally accepted accounting
principles.
"ISSUANCE PERIOD" shall have the meaning specified in paragraph 2B(2).
"LIEN" shall mean any mortgage, pledge, security interest, encumbrance,
lien (statutory or otherwise) or charge of any kind (including any agreement to
give any of the foregoing, any conditional sale or other title retention
agreement, any lease in the nature thereof, and the filing of or agreement to
give any financing statement under the Uniform Commercial Code of any
jurisdiction) or any other type of preferential arrangement for the purpose, or
having the effect, of protecting a creditor against loss or securing the payment
or performance of an obligation.
"MULTIEMPLOYER PLAN" shall mean any Plan which is a "Multiemployer plan"
(as such term is defined in section 4001(a)(3) of ERISA.
"NOTES" shall have the meaning specified in paragraph 1D.
"OFFICER'S CERTIFICATE" shall mean a certificate signed in the name of the
Company by an Authorized Officer of the Company.
"ORIGINAL CLOSING DAY" shall have the meaning provided in paragraph 2A(1).
"PBGC" shall mean the Pension Benefit Guaranty Corporation, or any
successor or replacement entity thereto under ERISA.
"PERCENTAGE OF ASSETS TRANSFERRED" shall mean, with respect to each asset
Transferred pursuant to clause (iii) of paragraph 6C(6) or clause (ii) of
paragraph 6C(4), the ratio (expressed as a percentage) of (i) the value of such
asset (which value, with respect to each asset, shall be the higher of its fair
market value or its net book value on the date of its Transfer) to (ii)
Consolidated Assets (determined as of the last day of the fiscal quarter
immediately preceding the date of such Transfer).
"PERCENTAGE OF EARNINGS CAPACITY TRANSFERRED" shall mean, with respect to
each asset Transferred pursuant to clause (iii) of paragraph 6C(6) or clause
(ii) of paragraph 6C(4), the ratio (expressed as a percentage) of (i) aggregate
net income produced by, or attributable to, such asset during the four fiscal
quarter period most recently ended prior to the effective date of such Transfer
to (ii) consolidated net income of the Company and its Subsidiaries for such
four fiscal quarter period.
"PERSON" shall mean and include an individual, a partnership, a joint
venture, a corporation, a trust, an unincorporated organization and a government
or any department or agency thereof.
33
"PLAN" shall mean any employee pension benefit plan (as such term is
defined in section 3 of ERISA) which is or has been established or maintained,
or to which contributions are or have been made, by the Company or any ERISA
Affiliate.
"PRIORITY DEBT" shall mean, as of any time of determination thereof, the
aggregate amount of (i) Debt of the Company secured by any Lien and (ii) Debt of
Subsidiaries, excluding in each case any Debt described in clauses (i), (ii) and
(iv) of paragraph 6C(2).
"PRUDENTIAL" shall mean The Prudential Insurance Company of America.
"PRUDENTIAL AFFILIATE" shall mean any corporation or other entity all of
the Voting Stock (or equivalent voting securities or interests) of which is
owned by Prudential either directly or through Prudential Affiliates.
"PURCHASERS" shall mean Prudential with respect to the Series A, Series B
and Series C Notes and, with respect to any Accepted Notes, Prudential and/or
the Prudential Affiliate(s) which are purchasing such Accepted Notes.
"RELATED PARTY" shall mean (i) any Significant Stockholder, (ii) all
persons to whom any Significant Stockholder is related by blood, adoption or
marriage and (iii) all Affiliates of the foregoing Persons.
"REQUEST FOR PURCHASE" shall have the meaning specified in paragraph 2B(3).
"REQUIRED HOLDER(S)" shall mean the holder or holders of at least 51% of
the aggregate principal amount of the Notes or of a Series of Notes, as the
context may require, from time to time outstanding.
"RESCHEDULED CLOSING DAY" shall have the meaning specified in paragraph
2B(7).
"RESPONSIBLE OFFICER" shall mean the chief executive officer, chief
operating officer, chief financial officer or chief accounting officer of the
Company, general counsel of the Company or any other officer of the Company
involved principally in its financial administration or its controllership
function.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended.
"SERIES" shall have the meaning specified in paragraph 1B.
"SERIES C CLOSING DAY" shall have the meaning specified in paragraph 2A(3).
"SERIES A NOTE(S)" shall have the meaning specified in paragraph 1A.
"SERIES B NOTE(S)" shall have the meaning specified in paragraph 1B.
34
"SERIES C NOTE(S)" shall have the meaning specified in paragraph 1C.
"SHELF NOTE(S)" shall have the meaning specified in paragraph 1D.
"SIGNIFICANT STOCKHOLDER" shall mean and include any Person who owns,
beneficially or of record, directly or indirectly, at any time during any year
with respect to which a computation is being made, either individually or
together with all persons to whom such Person is related by blood, adoption or
marriage, 5% or more of the Voting Stock of the Company.
"SUBSIDIARY" shall mean any corporation organized under the laws of any
state of the United States of America, Canada, or any province of Canada, which
conducts the major portion of its business in and makes the major portion of its
sales to Persons located in the United States of America or Canada, and at least
51% of the stock of every class of which shall, at the time as of which any
determination is being made, be owned by the Company either directly or through
Subsidiaries.
"SWAPS" shall mean, with respect to any Person, payment obligations with
respect to interest swaps or ▇▇▇▇▇▇, currency swaps or ▇▇▇▇▇▇ and similar
obligations obligating such Person to make payments, whether periodically or
upon the happening of a contingency. For the purposes of this Agreement, the
amount of the obligation under any Swap shall be the amount determined in
respect thereof as of the end of the then most recently ended fiscal quarter of
such Person, based on the assumption that such Swap had terminated at the end of
such fiscal quarter, and in making such determination, if any agreement relating
to such Swap provides for the netting of amounts payable by and to such Person
thereunder or if any such agreement provides for the simultaneous payment of
amounts by and to such Person, then in each such case, the amount of such
obligation shall be the net amount so determined.
"THREE YEAR PERCENTAGE OF ASSETS TRANSFERRED" shall mean, with respect to
any twelve consecutive fiscal quarter period, the sum of the Percentages of
Assets Transferred for the assets of the Company and its Subsidiaries that are
Transferred during such period pursuant to clause (iii) of paragraph 6C(6) and
clause (ii) of paragraph 6C(4).
"THREE YEAR PERCENTAGE OF EARNINGS CAPACITY TRANSFERRED" shall mean, with
respect to any twelve consecutive fiscal quarter period, the sum of the
Percentages of Earnings Capacity Transferred for the assets of the Company and
its Subsidiaries that are Transferred during such period pursuant to clause
(iii) of paragraph 6C(6) and clause (ii) of paragraph 6C(4).
"TRANSFER" shall mean, with respect to any item, the sale, exchange,
conveyance, lease, transfer or other disposition of such item.
"TRANSFEREE" shall mean any direct or indirect transferee of all or any
part of any Note purchased by any Purchaser under this Agreement.
"VOTING STOCK" shall mean, with respect to any corporation, any shares of
stock of such corporation whose holders are entitled under ordinary
circumstances to vote for the election
35
of directors of such corporation (irrespective of whether at the time stock of
any other class or classes shall have or might have voting power by reason of
the happening of any contingency).
"WHOLLY-OWNED SUBSIDIARY" shall mean a Subsidiary, all of the stock of
every class of which except directors' qualifying shares, is owned by the
Company directly or indirectly through Wholly-Owned Subsidiaries.
10C. ACCOUNTING PRINCIPLES, TERMS AND DETERMINATIONS. All references
in this Agreement to "generally accepted accounting principles" shall be deemed
to refer to generally accepted accounting principles in effect in the United
States at the time of application thereof. Unless otherwise specified herein,
all accounting terms used herein shall be interpreted, all determinations with
respect to accounting matters hereunder shall be made, and all unaudited
financial statements and certificates and reports as to financial matters
required to be furnished hereunder shall be prepared, in accordance with
generally accepted accounting principles applied on a basis consistent with the
most recent audited financial statements delivered pursuant to clause (ii) of
paragraph 5A or, if no such statements have been so delivered, the most recent
audited financial statements referred to in clause (i) of paragraph 8B.
11. MISCELLANEOUS.
11A. NOTE PAYMENTS. The Company agrees that, so long as any Purchaser
shall hold any Note, it will make payments of principal of, interest on, and any
Yield-Maintenance Amount payable with respect to, such Note, which comply with
the terms of this Agreement, by wire transfer of immediately available funds for
credit (not later than 12:00 noon, New York City local time, on the date due) to
(i) the account or accounts of such Purchaser specified in the Purchaser
Schedule attached hereto in the case of any Series A Note, (ii) the account or
accounts of such Purchaser specified in the Confirmation of Acceptance with
respect to such Note in the case of any Shelf Note or (iii) such other account
or accounts in the United States as such Purchaser may from time to time
designate in writing, notwithstanding any contrary provision herein or in any
Note with respect to the place of payment. Each Purchaser agrees that, before
disposing of any Note, it will make a notation thereon (or on a schedule
attached thereto) of all principal payments previously made thereon and of the
date to which interest thereon has been paid. The Company agrees to afford the
benefits of this paragraph 11A to any Transferee which shall have made the same
agreement as the Purchasers have made in this paragraph 11A.
11B. EXPENSES. The Company agrees, whether or not the transactions
contemplated hereby shall be consummated, to pay, and save Prudential, each
Purchaser and any Transferee harmless against liability for the payment of, all
out-of-pocket expenses arising in connection with such transactions, including
(i) all document production and duplication charges and the fees and expenses of
any special counsel engaged by the Purchasers or any Transferee in connection
with this Agreement, the transactions contemplated hereby and any subsequent
proposed modification of, or proposed consent under, this Agreement, whether or
not such proposed modification shall be effected or proposed consent granted,
and (ii) the costs and expenses, including attorneys' fees, incurred by any
Purchaser or any Transferee in enforcing (or determining whether or how to
enforce) any rights under this Agreement or the Notes or in responding to any
subpoena or other legal process or informal investigative demand issued in
36
connection with this Agreement or the transactions contemplated hereby or by
reason of any Purchaser's or any Transferee's having acquired any Note,
including without limitation costs and expenses incurred in any bankruptcy case
involving the Company. The obligations of the Company under this paragraph 11B
shall survive the transfer of any Note or portion thereof or interest therein by
any Purchaser or any Transferee and the payment of any Note.
11C. CONSENT TO AMENDMENTS. This Agreement may be amended, and the
Company may take any action herein prohibited, or omit to perform any act herein
required to be performed by it, if the Company shall obtain the written consent
to such amendment, action or omission to act, of the Required Holder(s) of the
Notes of each Series except that, (i) with the written consent of the holders of
all Notes of a particular Series, and if an Event of Default shall have occurred
and be continuing, of the holders of all Notes of all Series, at the time
outstanding (and not without such written consents), the Notes of such Series
may be amended or the provisions thereof waived to change the maturity thereof,
to change or affect the principal thereof, or to change or affect the rate or
time of payment of interest on or any Yield-Maintenance Amount payable with
respect to the Notes of such Series, (ii) without the written consent of the
holder or holders of all Notes at the time outstanding, no amendment to or
waiver of the provisions of this Agreement shall change or affect the provisions
of paragraph 7A or this paragraph 11C insofar as such provisions relate to
proportions of the principal amount of the Notes of any Series, or the rights of
any individual holder of Notes, required with respect to any declaration of
Notes to be due and payable or with respect to any consent, amendment, waiver or
declaration, (iii) with the written consent of Prudential (and not without the
written consent of Prudential) the provisions of paragraph 2B may be amended or
waived (except insofar as any such amendment or waiver would affect any rights
or obligations with respect to the purchase and sale of Notes which shall have
become Accepted Notes prior to such amendment or waiver), and (iv) with the
written consent of all of the Purchasers which shall have become obligated to
purchase Accepted Notes of any Series (and not without the written consent of
all such Purchasers), any of the provisions of paragraphs 2B and 3 may be
amended or waived insofar as such amendment or waiver would affect only rights
or obligations with respect to the purchase and sale of the Accepted Notes of
such Series or the terms and provisions of such Accepted Notes. Each holder of
any Note at the time or thereafter outstanding shall be bound by any consent
authorized by this paragraph 11C, whether or not such Note shall have been
marked to indicate such consent, but any Notes issued thereafter may bear a
notation referring to any such consent. No course of dealing between the
Company and the holder of any Note nor any delay in exercising any rights
hereunder or under any Note shall operate as a waiver of any rights of any
holder of such Note. As used herein and in the Notes, the term "THIS AGREEMENT"
and references thereto shall mean this Agreement as it may from time to time be
amended or supplemented.
11D. FORM, REGISTRATION, TRANSFER AND EXCHANGE OF NOTES; LOST NOTES.
The Notes are issuable as registered notes without coupons in denominations of
at least $1,000,000, except as may be necessary to reflect any principal amount
not evenly divisible by $1,000,000. The Company shall keep at its principal
office a register in which the Company shall provide for the registration of
Notes and of transfers of Notes. Upon surrender for registration of transfer of
any Note at the principal office of the Company, the Company shall, at its
expense, execute and deliver one or more new Notes of like tenor and of a like
aggregate principal amount, registered in the name of such transferee or
transferees. At the option of the holder of any Note, such Note
37
may be exchanged for other Notes of like tenor and of any authorized
denominations, of a like aggregate principal amount, upon surrender of the Note
to be exchanged at the principal office of the Company. Whenever any Notes are
so surrendered for exchange, the Company shall, at its expense, execute and
deliver the Notes which the holder making the exchange is entitled to receive.
Each prepayment of principal payable on each prepayment date upon each new Note
issued upon any such transfer or exchange shall be in the same proportion to the
unpaid principal amount of such new Note as the prepayment of principal payable
on such date on the Note surrendered for registration of transfer or exchange
bore to the unpaid principal amount of such Note. No reference need be made in
any such new Note to any prepayment or prepayments of principal previously due
and paid upon the Note surrendered for registration of transfer or exchange.
Every Note surrendered for registration of transfer or exchange shall be duly
endorsed, or be accompanied by a written instrument of transfer duly executed,
by the holder of such Note or such holder's attorney duly authorized in writing.
Any Note or Notes issued in exchange for any Note or upon transfer thereof shall
carry the rights to unpaid interest and interest to accrue which were carried by
the Note so exchanged or transferred, so that neither gain nor loss of interest
shall result from any such transfer or exchange. Upon receipt of written notice
from the holder of any Note of the loss, theft, destruction or mutilation of
such Note and, in the case of any such loss, theft or destruction, upon receipt
of such holder's unsecured indemnity agreement, or in the case of any such
mutilation upon surrender and cancellation of such Note, the Company will make
and deliver a new Note, of like tenor, in lieu of the lost, stolen, destroyed or
mutilated Note.
11E. PERSONS DEEMED OWNERS; PARTICIPATIONS. Prior to due presentment
for registration of transfer, the Company may treat the Person in whose name any
Note is registered as the owner and holder of such Note for the purpose of
receiving payment of principal of and interest on, and any Yield-Maintenance
Amount payable with respect to, such Note and for all other purposes whatsoever,
whether or not such Note shall be overdue, and the Company shall not be affected
by notice to the contrary. Subject to the preceding sentence, the holder of any
Note may from time to time grant participations in all or any part of such Note
to any Person on such terms and conditions as may be determined by such holder
in its sole and absolute discretion.
11F. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.
All representations and warranties contained herein or made in writing by or on
behalf of the Company in connection herewith shall survive the execution and
delivery of this Agreement and the Notes, the transfer by any Purchaser of any
Note or portion thereof or interest therein and the payment of any Note, and may
be relied upon by any Transferee, regardless of any investigation made at any
time by or on behalf of any Purchaser or any Transferee. Subject to the
preceding sentence, this Agreement and the Notes embody the entire agreement and
understanding between the parties hereto with respect to the subject matter
hereof and supersede all prior agreements and understandings relating to such
subject matter.
11G. SUCCESSORS AND ASSIGNS. All covenants and other agreements in
this Agreement contained by or on behalf of any of the parties hereto shall bind
and inure to the benefit of the respective successors and assigns of the parties
hereto (including, without limitation, any Transferee) whether so expressed or
not.
38
11H. INDEPENDENCE OF COVENANTS. All covenants hereunder shall be
given independent effect so that if a particular action or condition is
prohibited by any one of such covenants, the fact that it would be permitted by
an exception to, or otherwise be in compliance within the limitations of,
another covenant shall not (i) avoid the occurrence of a Default or Event of
Default if such action is taken or such condition exists or (ii) in any way
prejudice an attempt by the holder of any Note to prohibit through equitable
action or otherwise the taking of any action by the Company or any Subsidiary
which would result in a Default or Event of Default.
11I. NOTICES. All written communications provided for hereunder
(other than communications provided for under paragraph 2) shall be sent by
first class mail or nationwide overnight delivery service (with charges prepaid)
and (i) if to any Purchaser, addressed as specified for such communications in
the Purchaser Schedule attached hereto (in the case of the Series A Notes) or
the Purchaser Schedule attached to the applicable Confirmation of Acceptance (in
the case of any Shelf Notes) or at such other address as any such Purchaser
shall have specified to the Company in writing, (ii) if to any other holder of
any Note, addressed to it at such address as it shall have specified in writing
to the Company or, if any such holder shall not have so specified an address,
then addressed to such holder in care of the last holder of such Note which
shall have so specified an address to the Company and (iii) if to the Company,
addressed to it at 500 Century Building, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Chief Financial Officer, provided,
HOWEVER, that any such communication to the Company may also, at the option of
the Person sending such communication, be delivered by any other means either to
the Company at its address specified above or to any Authorized Officer of the
Company. Any communication pursuant to paragraph 2 shall be made by the method
specified for such communication in paragraph 2, and shall be effective to
create any rights or obligations under this Agreement only if, in the case of a
telephone communication, an Authorized Officer of the party conveying the
information and of the party receiving the information are parties to the
telephone call, and in the case of a telecopier communication, the communication
is signed by an Authorized Officer of the party conveying the information,
addressed to the attention of an Authorized Officer of the party receiving the
information, and in fact received at the telecopier terminal the number of which
is listed for the party receiving the communication in the Information Schedule
or at such other telecopier terminal as the party receiving the information
shall have specified in writing to the party sending such information.
11J. PAYMENTS DUE ON NON-BUSINESS DAYS. Anything in this Agreement or
the Notes to the contrary notwithstanding, any payment of principal of or
interest on, or Yield-Maintenance Amount payable with respect to, any Note that
is due on a date other than a Business Day shall be made on the next succeeding
Business Day. If the date for any payment is extended to the next succeeding
Business Day by reason of the preceding sentence, the period of such extension
shall be included in the computation of the interest payable on such Business
Day.
11K. SEVERABILITY. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
39
11L. DESCRIPTIVE HEADINGS. The descriptive headings of the several
paragraphs of this Agreement are inserted for convenience only and do not
constitute a part of this Agreement.
11M. SATISFACTION REQUIREMENT. If any agreement, certificate or other
writing, or any action taken or to be taken, is by the terms of this Agreement
required to be satisfactory to any Purchaser, to any holder of Notes or to the
Required Holder(s), the determination of such satisfaction shall be made by such
Purchaser, such holder or the Required Holder(s), as the case may be, in the
sole and exclusive judgment (exercised in good faith) of the Person or Persons
making such determination.
11N. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE
INTERNAL LAW OF THE STATE OF ILLINOIS.
11O. SEVERALTY OF OBLIGATIONS. The sales of Notes to the Purchasers
are to be several sales, and the obligations of Prudential and the Purchasers
under this Agreement are several obligations. No failure by Prudential or any
Purchaser to perform its obligations under this Agreement shall relieve any
other Purchaser or the Company of any of its obligations hereunder, and neither
Prudential nor any Purchaser shall be responsible for the obligations of, or any
action taken or omitted by, any other such Person hereunder.
11P. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
[BALANCE OF PAGE INTENTIONALLY LEFT BLANK]
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11Q. BINDING AGREEMENT. When this Agreement is executed and delivered
by the Company and Prudential, it shall become a binding agreement between the
Company, and Prudential. This Agreement shall also inure to the benefit of
each Purchaser which shall have executed and delivered a Confirmation of
Acceptance, and each such Purchaser shall be bound by this Agreement to the
extent provided in such Confirmation of Acceptance.
Very truly yours,
CONSOLIDATED PRODUCTS, INC.
By: /s/ ▇▇▇▇▇ ▇. Bear
-----------------------------
Name: ▇▇▇▇▇ ▇. Bear
Title: Senior Vice President and Treasurer
The foregoing Agreement is
hereby accepted as of the
date first above written.
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
---------------------------
Vice President
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