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EXHIBIT 4.1.3
BIRMINGHAM STEEL CORPORATION
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WAIVER AND THIRD AMENDMENT TO NOTE PURCHASE AGREEMENT
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Re:
Note Purchase Agreements Dated as of September 1, 1993
and
$130,000,000 Original Principal Amount of
7.28% Senior Notes Due December 15, 2005
DATED OCTOBER 12, 1999
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TABLE OF CONTENTS
PAGE
1. PRELIMINARY STATEMENT...................................................1
1.1 BACKGROUND..........................................................1
1.2 DEFINITIONS.........................................................3
2. AMENDMENTS AND WAIVERS..................................................6
2.1 AMENDMENT AND RESTATEMENT OF EXISTING NOTE PURCHASE AGREEMENT.......6
2.2 AMENDMENT AND RESTATEMENT OF EXISTING NOTES.........................6
2.3 WAIVERS OF EXISTING EVENTS OF DEFAULT...............................6
2.4 CONTINUITY AND AFFIRMATION OF OBLIGATIONS...........................6
3. REPRESENTATIONS AND WARRANTIES..........................................7
3.1 SUBSIDIARIES AND STOCK OWNERSHIP....................................7
3.2 CORPORATE EXISTENCE AND POWER.......................................7
3.3 CORPORATE AUTHORITY.................................................8
3.4 BINDING EFFECT......................................................8
3.5 NO CONFLICTS WITH AGREEMENTS, ETC...................................8
3.6 CONSENTS, ETC.......................................................9
3.7 FULL DISCLOSURE.....................................................9
3.8 OUTSTANDING DEBT AND LIENS..........................................9
3.9 PENDING LITIGATION.................................................10
3.10 NO DEFAULTS.......................................................10
3.11 COMPLIANCE WITH LAW...............................................10
3.12 TITLE TO PROPERTIES...............................................10
3.13 ENVIRONMENTAL COMPLIANCE..........................................11
3.14 RESTRICTIONS ON COMPANY AND SUBSIDIARIES..........................12
3.15 COLLATERAL........................................................13
3.16 SOLVENCY..........................................................14
4. CONDITIONS PRECEDENT...................................................15
4.1 CERTIFICATES.......................................................15
4.2 OPINIONS OF COUNSEL................................................16
4.3 OMNIBUS COLLATERAL AGREEMENT.......................................15
4.4 GUARANTY AGREEMENT.................................................16
4.5 1995 SECOND AMENDMENT..............................................16
4.6 FIFTH AMENDMENT TO CREDIT AGREEMENT................................16
4.7 LETTER OF CREDIT DOCUMENTS.........................................17
4.8 OTHER RELATED MATTERS..............................................17
4.9 INTERCREDITOR AGREEMENT............................................17
4.10 SECURITY DOCUMENTS................................................17
4.11 LIEN SEARCHES.....................................................19
4.12 RESTRUCTURING FEE.................................................19
4.13 PRIVATE PLACEMENT NUMBER..........................................19
4.14 PAYMENT OF SPECIAL COUNSEL AND FINANCIAL ADVISOR FEES.............19
4.15 LEASE LETTERS.....................................................20
4.16 PROCEEDINGS AND DOCUMENTS SATISFACTORY............................20
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TABLE OF CONTENTS
PAGE
5. MISCELLANEOUS..........................................................20
5.1 EFFECT OF AMENDMENT AND WAIVER.....................................20
5.2 NO LEGEND REQUIRED.................................................20
5.3 FEES AND EXPENSES..................................................20
***5.4 SURVIVAL........................................................21
5.5 DUPLICATE ORIGINALS; EXECUTION IN COUNTERPART......................21
5.6 RELEASE OF CLAIMS..................................................22
5.7 GOVERNING LAW......................................................22
Schedule 3.1 -- Subsidiaries
Schedule 3.8 -- Outstanding Debt and Liens
Schedule 3.14 -- Restrictive Agreements
Schedule 3.15 -- Recording Information
Exhibit A -- Amended and Restated Note Purchase Agreement
Exhibit B1 -- Form of Opinion of Special Company Counsel to the Company
and the Restricted Subsidiaries
Exhibit B2 -- Form of Opinion of Local Counsel to the Company and the
Restricted Subsidiaries
Exhibit B3 -- Form of Opinion of Special Counsel to the Collateral Agent
Exhibit C -- Form of Omnibus Collateral Agreement
Exhibit D -- Form of Guaranty Agreement
Exhibit E -- Form of Intercreditor Agreement
Exhibit F1 -- Form of Alabama Mortgage
Exhibit F2 -- Form of Florida Mortgage
Exhibit F3 -- Form of Illinois Mortgage
Exhibit F4 -- Form of Mississippi Mortgage
Exhibit F5 -- Form of Ohio Mortgage
Exhibit F6 -- Form of Tennessee Mortgage
Exhibit F7 -- Form of Washington Mortgage
Exhibit G -- Form of Security Agreement
Exhibit H -- Form of Trademark/Copyright Security Agreement
Exhibit I -- Form of Stock Pledge Agreement
Exhibit J -- Form of Note Pledge Agreement
II
BIRMINGHAM STEEL CORPORATION
WAIVER AND THIRD AMENDMENT TO NOTE PURCHASE AGREEMENT
Re:
Note Purchase Agreements Dated as of September 1, 1993
and
$130,000,000 Original Principal Amount of
7.28% Senior Notes Due December 15, 2005
Dated October 12, 1999
To the Persons listed on
the signature pages hereof
Ladies and Gentlemen:
BIRMINGHAM STEEL CORPORATION, a Delaware corporation (together with its
successors and assigns, the "Company"), hereby agrees with you as follows:
1. PRELIMINARY STATEMENT.
1.1 Background.
(a) The Company entered into those certain Note Purchase Agreements
dated as of September 1, 1993, as amended by an Amendment to Note Purchase
Agreement dated as of October 18, 1996 and as further amended by Amendment
to 1993 Note Purchase Agreement dated as of December 14, 1998
(collectively, as in effect immediately prior to the Effective Date, the
"Existing Note Purchase Agreement," and as amended hereby, the "Amended
Note Purchase Agreement"), with each of the institutions named in Annex 1
thereto, under and pursuant to which the Company issued and sold to such
institutions an aggregate principal amount of One Hundred
Thirty Million Dollars ($130,000,000) of the Company's 7.28% Senior Notes
due December 15, 2005 (as in effect immediately prior to the Effective
Date, the "Existing Notes," and as amended hereby, the "Amended Notes").
(b) The institutions (other than the Company) listed on the signature
pages to this Agreement (collectively, the "Noteholders") are the holders
of one hundred percent (100%) of the Existing Notes outstanding as of the
Effective Date.
(c) The Company entered into those certain Note Purchase Agreements
dated as of September 15, 1995, with each of the institutions named in
Annex 1 thereto (together with their successors and assigns, the "1995
Noteholders"), as amended by an Amendment to 1995 Note Purchase Agreement
dated as of December 14, 1998 (collectively, as in effect immediately prior
to the Effective Date, the "1995 Existing Note Purchase Agreement," and, as
amended by a Waiver and Second Amendment to 1995 Note Purchase Agreement
dated as of the date hereof (the "1995 Second Amendment"), the "1995
Amended Note Purchase Agreement"), under and pursuant to which the Company
issued and sold to such institutions (i) an aggregate principal amount of
Seventy-Six Million Dollars ($76,000,000) of the Company's 6.96% Series A
Senior Notes due December 15, 2002, (ii) an aggregate principal amount of
Fourteen Million Dollars ($14,000,000) of the Company's 7.07% Series B
Senior Notes due December 15, 2005, and (iii) an aggregate principal amount
of Sixty Million Dollars ($60,000,000) of the Company's 7.17% Series C
Senior Notes due December 15, 2005 (collectively, the "1995 Notes").
(d) The Company entered into that certain Credit Agreement dated as of
March 17, 1997 (as in effect immediately prior to the Effective Date, the
"Existing Credit Agreement," and as heretofore amended and as amended by a
Fifth Amendment to Credit Agreement dated as of the date hereof (the "Fifth
Amendment"), the "Amended Credit Agreement"), by and among the Company, the
banks party thereto (collectively, the "Banks"), and Bank of America, N.A.,
as agent (the "Agent"), pursuant to which a Three Hundred Million Dollar
($300,000,000) credit facility has been provided to the Company.
(e) Bank of America, N.A. and PNC Bank, National Association
(collectively, the "L/C Issuers") have separately provided the Company with
three (3) letters of credit (collectively, the "Letters of Credit") which
have an aggregate face amount of Fifty-One Million Nine Hundred
Ninety-Three Thousand One Hundred Fifty-One Dollars ($51,993,151), which
Letters of
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Credit were issued pursuant to (i) an Amended and Restated Reimbursement
Agreement, dated as of October 12, 1999, among the Company, American Steel
& Wire Corporation and Bank of America, N.A. (as amended, the "B of A
Reimbursement Agreement"), (ii) a Reimbursement Agreement dated as of
October 1, 1996, between PNC Bank, National Association successor to PNC
Bank, Kentucky, Inc. and the Company (as amended, "PNC Reimbursement
Agreement One") and (iii) a Reimbursement Agreement dated as of August 15,
1995 between the Company and PNC Bank, National Association, successor to
PNC Bank, Kentucky, Inc. ("PNC Reimbursement Agreement Two," and
collectively with the B of A Reimbursement Agreement and PNC Reimbursement
Agreement One, the "Existing Reimbursement Agreements").
(f) The Company has notified the Noteholders, the 1995 Noteholders,
the Banks and the L/C Issuers of certain Defaults and Events of Default
under, and as defined in, the Existing Note Purchase Agreement, the 1995
Existing Note Purchase Agreement, the Existing Credit Agreement and the
Existing Reimbursement Agreements, respectively.
(g) The Company requests the amendment and restatement of the Existing
Note Purchase Agreement and the waiver of the existing Defaults and Events
of Default specified herein, and, in exchange therefor, the Company agrees
to amend and restate the Existing Notes to, among other things, increase
the interest rate applicable thereto, to cause one or more of its
Restricted Subsidiaries to enter into the Guaranty Agreement, and to grant,
and to cause one or more of its Restricted Subsidiaries to grant, the
security interests described in the Security Documents to the Collateral
Agent for the ratable benefit of the Noteholders, the 1995 Noteholders, the
Banks and the L/C Issuers and for the benefit of the Indenture Trustee and
the Owner Trustee.
(h) The Noteholders are agreeable, subject to the terms and conditions
set forth herein, to amending and restating in full the Existing Note
Purchase Agreement and the Existing Notes as provided herein.
1.2 Definitions.
Capitalized terms used but not specifically defined in this Agreement have
the respective meanings assigned to them in the Existing Note Purchase
Agreement. As used in this Agreement, the following terms have the respective
meanings specified below or set forth in the Section hereof following such term:
Acceptable SBQ Asset Sale - has the meaning specified in the
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Amended Note Purchase Agreement.
Agent - Section 1.1(d).
Agreement, this - means this Waiver and Third Amendment to Note
Purchase Agreement, as it may be amended or otherwise modified from time to
time.
Amended Credit Agreement - Section 1.1(d).
Amended Note Purchase Agreement - Section 1.1(a).
Amended Notes - Section 1.1(a).
Banks - Section 1.1(d).
B of A Reimbursement Agreement - Section 1.1(e).
Collateral Agent - means State Street Bank and Trust Company, in its
capacity as collateral agent under the Intercreditor Agreement.
Company - the introductory sentence.
Effective Date - Section 4.
Existing Credit Agreement - Section 1.1(d).
Existing Note Purchase Agreement - Section 1.1(a).
Existing Notes - Section 1.1(a).
Existing Reimbursement Agreements - Section 1.1(e).
Fifth Amendment - Section 1.1(d).
Financing Documents - means, collectively, this Agreement, the Omnibus
Collateral Agreement, the Intercreditor Agreement, the Guaranty Agreement
and each of the Security Documents, in each case, as may be amended or
otherwise modified from time to time.
Guaranty Agreement - Section 4.4.
Indenture Trustee - has the meaning set forth in the Intercreditor
Agreement.
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Intercreditor Agreement - Section 4.9.
L/C Issuers - Section 1.1(e).
Letters of Credit - Section 1.1(e).
Mortgages - Section 4.10(a).
1995 Amended Note Purchase Agreement - Section 1.1(c).
1995 Existing Note Purchase Agreement - Section 1.1(c).
1995 Noteholders - Section 1.1(c).
1995 Notes - Section 1.1(c).
1995 Second Amendment - Section 1.1(c).
Note Pledge Agreement - Section 4.10(e).
Noteholders - Section 1.1(b).
Omnibus Collateral Agreement - Section 4.3.
Operative Agreements - has the meaning specified in Appendix A to that
certain Participation Agreement (Birmingham Steel Trust 97-1), dated as of
September 30, 1997, among the Company, as lessee, the Owner Trustee, the
Indenture Trustee and the institutional lenders party thereto, as amended.
Owner Trustee - has the meaning set forth in the Intercreditor
Agreement.
PNC Reimbursement Agreement One - Section 1.1(e).
PNC Reimbursement Agreement Two - Section 1.1(e).
Security Agreement - Section 4.10(b).
Security Documents - means, collectively, each of the Mortgages, the
Security Agreement, the Trademark/Copyright Security Agreement, the Stock
Pledge Agreement and the Note Pledge Agreement.
Stock Pledge Agreement - Section 4.10(d).
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Trademark/Copyright Security Agreement - Section 4.10(c).
Transaction Documents - has the meaning specified in the Omnibus
Collateral Agreement.
2. AMENDMENTS AND WAIVERS
2.1 Amendment and Restatement of Existing Note Purchase Agreement.
The Existing Note Purchase Agreement (including Exhibit A) is hereby
amended and restated in full in the form attached hereto as Exhibit A. On the
Effective Date, the Amended Note Purchase Agreement shall supercede and replace
the Existing Note Purchase Agreement and the Existing Note Purchase Agreement
will cease to be of further force and effect.
2.2 Amendment and Restatement of Existing Notes.
(a) The form of the Existing Notes attached to the Existing Note
Purchase Agreement as Exhibit A is hereby amended and restated in full in
the form attached as Exhibit A to the Amended Note Purchase Agreement.
(b) All Existing Notes outstanding on the Effective Date are hereby,
without any further action being required on the part of the Noteholders or
on the part of any other Person, deemed to be conformed to the form of
Amended Note attached to the Amended Note Purchase Agreement as Exhibit A.
The outstanding Amended Notes shall be and are entitled to all of the
rights and benefits provided therefor in the Amended Note Purchase
Agreement.
2.3 Waivers of Existing Events of Default.
Each existing Default and Event of Default under the Existing Note Purchase
Agreement arising as a result of facts, circumstances or events in effect or
existence on or prior to the effectiveness of this Agreement on the date hereof
is hereby permanently and irrevocably waived and the Company and the Noteholders
hereby agree that each such existing Default and Event of Default shall be
deemed to have been permanently and irrevocably waived as of the date of the
initial occurrence thereof.
2.4 Continuity and Affirmation of Obligations.
Notwithstanding any other provision of this Agreement or any other document
or agreement, the indebtedness of the Company under the Existing Note
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Purchase Agreement and the Existing Notes shall not be or be deemed to be paid
or discharged or novated hereby and shall continue in full force and effect as
amended hereby.
3. REPRESENTATIONS AND WARRANTIES
To induce the Noteholders to enter into this Agreement, the Company makes
the representations and warranties set forth in this Section 3. The Company
agrees and acknowledges that for purposes of Section 10.1(e) of the Amended Note
Purchase Agreement, its representations and warranties, as set forth in this
Agreement, are and constitute representations and warranties furnished in
connection with the Amended Note Purchase Agreement.
3.1 Subsidiaries and Stock Ownership.
Schedule 3.1 hereto states the name of each Subsidiary (indicating which
Subsidiaries are Restricted Subsidiaries), its jurisdiction of incorporation and
the percentage of its Voting Stock owned by the Company and each other
Subsidiary. Each of the Company and the Subsidiaries has good and marketable
title to all of the shares it purports to own of the stock of each Subsidiary,
free and clear in each case of any Lien. All such shares have been duly issued
and are fully paid and nonassessable.
3.2 Corporate Existence and Power.
Each of the Company and the Subsidiaries:
(a) is a corporation duly incorporated, validly existing and in good
standing under the laws of its jurisdiction of incorporation;
(b) has the legal and corporate power and authority necessary to own
and operate its Properties and to carry on its business as now conducted
and as presently proposed to be conducted;
(c) has all necessary licenses, certificates, permits, franchises and
other governmental authorizations necessary to own and operate its
Properties and to carry on its business as now conducted and as presently
proposed to be conducted, except where the failure to have such licenses,
certificates and permits, in the aggregate for all such failures, could not
reasonably be expected to have a Material Adverse Effect;
(d) has duly qualified or has been duly licensed, and is authorized to
do business and is in good standing, as a foreign corporation, in each
state
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where the failure to be so qualified or licensed and authorized and in good
standing could reasonably be expected to have a Material Adverse Effect;
and
(e) has, in the case of each Restricted Subsidiary, all requisite
power and authority to execute, deliver and perform its obligations under
each Financing Document to which it is a party.
3.3 Corporate Authority.
The execution, delivery and performance by the Company and each Restricted
Subsidiary of each Financing Document to which the Company or such Restricted
Subsidiary is a party, and the performance by the Company of the Amended Note
Purchase Agreement and the Amended Notes, is within the corporate powers of the
Company or such Restricted Subsidiary, as the case may be, and has been duly
authorized by all necessary corporate action on the part of the board of
directors (no action on the part of the stockholders of the Company or any such
Restricted Subsidiary being required by law, other than such actions which have
been duly taken), of the Company or such Restricted Subsidiary.
3.4 Binding Effect.
Each Financing Document to which the Company or any Restricted Subsidiary
is a party has been duly executed by the Company or such Restricted Subsidiary
and each Financing Document, the Amended Note Purchase Agreement and each
Amended Note is a legal, valid and binding obligation of the Company or such
Restricted Subsidiary, as the case may be, enforceable against the Company or
such Restricted Subsidiary in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency or similar laws
affecting the enforcement of creditors' rights generally, or by general
principles of equity.
3.5 No Conflicts with Agreements, Etc.
Neither the execution and delivery by the Company or any Restricted
Subsidiary of any Financing Document to which it is a party, nor the fulfillment
of, or compliance with, the terms and provisions of any Financing Document, the
Amended Note Purchase Agreement or the Amended Notes, will conflict with, or
result in a breach or violation of any term, condition or provision of, or
constitute a default under, or result in the creation of any Lien (other than
Liens under the Security Documents) on any Property of the Company or such
Restricted Subsidiary pursuant to its charter or by-laws, or any contract,
agreement, mortgage, indenture, lease or instrument to which it is a party or by
which it is bound or to which it or any of its Property is subject, or any
order, statute, law, rule or regulation to which it or any of its Property is
subject.
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3.6 Consents, Etc.
No consent, approval or authorization of, or declaration, registration or
filing (except as contemplated under Section 4) with, any Governmental Authority
or any nongovernmental Person, including, without limitation, any creditor
(other than the 1995 Noteholders, the Banks and the L/C Issuers) or stockholder
of the Company or any Restricted Subsidiary, is required in connection with the
execution or delivery by the Company or any Restricted Subsidiary of any
Financing Document to which it is a party or the performance by the Company or
such Restricted Subsidiary of its obligations under any Financing Document, the
Amended Note Purchase Agreement or the Amended Notes, or as a condition to the
legality, validity or enforceability of any such Financing Document, the Amended
Note Purchase Agreement or the Amended Notes, except, in each case, those which
have been obtained or which are contemplated by the Transaction Documents.
3.7 Full Disclosure.
The financial statements and other written statements, certificates and
materials provided to the Noteholders pursuant to the Existing Note Purchase
Agreement and the written statements, certificates and materials furnished by or
on behalf of the Company to you in connection with this Agreement and the
transactions contemplated hereby do not contain any untrue statement of a
material fact or omit a material fact necessary to make the statements contained
therein or herein not misleading in light of the circumstances in which they
were made. Except as disclosed (i) in the Company's Annual Report on Form 10-K
for the fiscal year ended June 30, 1998, (ii) in the other reports filed by the
Company with the Securities and Exchange Commission after June 30, 1998, (iii)
in press releases issued by the Company prior to the Effective Date, or (iv) to
you or Nightingale Associates, LLC in writing, there is no fact known to the
Company which materially affects adversely or, so far as the Company can now
reasonably foresee, will materially affect adversely the business, prospects,
profits, Properties or condition (financial or otherwise) of the Company and the
Subsidiaries, taken as a whole, or the ability of the Company and each
Restricted Subsidiary to perform its obligations set forth in the Financing
Documents to which it is a party or, in the case of the Company, the Amended
Note Purchase Agreement or the Amended Notes.
3.8 Outstanding Debt and Liens.
Schedule 3.8 hereto sets forth a correct and complete schedule and brief
description of all Debt of the Company and the Subsidiaries outstanding on the
Effective Date and all consensual Liens securing such Debt. There are no Liens
on any of the Property of the Company or any Restricted Subsidiary except Liens
permitted by Section 8.17(a) of the Amended Note Purchase Agreement.
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3.9 Pending Litigation.
There are no proceedings, actions or investigations pending or, to the
knowledge of the Company, threatened against or affecting the Company or any
Subsidiary in any court or before any Governmental Authority or arbitration
board or tribunal (a) challenging, or in any way dealing with, the legality,
validity or enforceability of any Financing Document, the Amended Note Purchase
Agreement or the Amended Notes or the authority of the Company or any Restricted
Subsidiary to enter into or execute any Financing Document, the Amended Note
Purchase Agreement or the Amended Notes, or (b) except as disclosed (i) in the
Company's Annual Report on Form 10-K for the fiscal year ended June 30, 1998,
(ii) in the other reports filed by the Company with the Securities and Exchange
Commission after June 30, 1998, (iii) in press releases issued by the Company
prior to the Effective Date, or (iv) to you or Nightingale Associates, LLC in
writing, that, in the aggregate for all such proceedings, actions and
investigations, could reasonably be expected to have a Material Adverse Effect.
3.10 No Defaults.
No event has occurred and is continuing and no condition exists which, upon
execution and delivery of this Agreement (and giving effect to Section 2.3) and
the other Transaction Documents, would constitute a Default or Event of Default.
Neither the Company nor any Subsidiary is in violation in any respect of any
term of any charter instrument or by-law and neither the Company nor any
Subsidiary is in default in the payment of principal or interest on any Debt or
in default under any instrument or instruments or agreements under and subject
to which any Debt has been issued and no event has occurred and is continuing
under the provisions of any such instrument or agreement which with the lapse of
time or the giving of notice, or both, would constitute a default or an event of
default thereunder, which individually or in the aggregate could reasonably be
expected to have a Material Adverse Effect.
3.11 Compliance with Law.
Neither the Company nor any Subsidiary is in violation of any law,
ordinance, governmental rule or regulation to which it is subject, except for
such violations that, in the aggregate, could not reasonably be expected to have
a Material Adverse Effect.
3.12 Title to Properties.
(a) Each of the Company and the Subsidiaries has good and marketable
title to all real Property, and good title to all of the other
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Property, reflected in the most recent balance sheet delivered pursuant to
Section 9.1 of the Existing Note Purchase Agreement (except as sold or
otherwise disposed of in the ordinary course of business), except for such
failures to have such good and marketable title as are immaterial to such
financial statements and that, in the aggregate for all such failures,
could not reasonably be expected to have a Material Adverse Effect. All
such Property is free from Liens not permitted by Section 8.17 of the
Amended Note Purchase Agreement.
(b) Upon execution and delivery of this Agreement and the other
Transaction Documents, each lease of real Property in the name or for the
benefit of the Company or any Subsidiary is valid and subsisting and in
full force and effect and good standing, except for such failures to be
valid and subsisting and in full force and effect and good standing that,
in the aggregate, could not reasonably be expected to have a Material
Adverse Effect.
(c) Each of the Company and the Subsidiaries owns, possesses or has
the right to use all of the patents, trademarks, service marks, trade
names, copyrights and licenses, and rights with respect thereto, necessary
for the present and currently planned future conduct of its business,
without any known conflict with the rights of others, except for such
failures to own, possess, or have the right to use, that, in the aggregate
for all such failures, could not reasonably be expected to have a Material
Adverse Effect.
3.13 Environmental Compliance.
Except as disclosed (i) in the Company's Annual Report on Form 10-K for
the fiscal year ended June 30, 1998, (ii) in the other reports filed by the
Company with the Securities and Exchange Commission after June 30, 1998, (iii)
in press releases issued by the Company prior to the Effective Date, or (iv) to
the Noteholders or Nightingale Associates, LLC in writing:
(a) Compliance -- each of the Company and the Subsidiaries is in
compliance with all Environmental Protection Laws in effect in each
jurisdiction where it is presently doing business, and in which the failure
so to comply could be reasonably expected to have a Material Adverse
Effect;
(b) Liability -- neither the Company nor any of the Subsidiaries is
subject to any liability under any Environmental Protection Laws that, in
the aggregate, could reasonably be expected to have a Material Adverse
Effect; and
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(c) Notices -- neither the Company nor any Subsidiary has received any
(i) notice from any Governmental Authority by which any of its
present or previously-owned or leased real Properties has been
designated, listed, or identified in any manner by any Governmental
Authority charged with administering or enforcing any Environmental
Protection Law as a Hazardous Substance disposal or removal site,
"Super Fund" clean-up site, or candidate for removal or closure
pursuant to any Environmental Protection Law,
(ii) notice of any Lien arising under or in connection with any
Environmental Protection Law that has attached to any revenues of, or
to, any of its owned or leased real Properties, or
(iii) summons, citation, notice, directive, letter, or other
communication, written or oral, from any Governmental Authority
concerning any intentional or unintentional action or omission by the
Company or such Subsidiary in connection with its ownership or leasing
of any real Property resulting in the releasing, spilling, leaking,
pumping, pouring, emitting, emptying, dumping, or otherwise disposing
of any Hazardous Substance into the environment resulting in any
material violation of any Environmental Protection Law,
in each case where the effect of the matters that are the subject of any
such notice, summons, citation, directive, letter or other communication
could reasonably be expected to have a Material Adverse Effect.
3.14 Restrictions on Company and Subsidiaries.
Neither the Company nor any Subsidiary:
(a) except as set forth in Schedule 3.14 hereto, is a party to any
contract or agreement, or subject to any charter or other corporate
restriction that, in the aggregate for all such contracts, agreements,
charter and corporate restrictions, could reasonably be expected to have a
Material Adverse Effect;
(b) is a party to any contract or agreement that restricts the right
or ability of such corporation to incur Debt, other than the Amended Note
Purchase Agreement, the 1995 Amended Note Purchase Agreement, the Amended
Credit Agreement, any other Transaction Document and the agreements listed
in Schedule 3.14 hereto, the terms of none of which is
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violated by the execution and delivery by the Company or any Restricted
Subsidiary of the Financing Documents to which it is a party, or compliance
by the Company or any Restricted Subsidiary with the Financing Documents to
which it is a party or, in the case of the Company, the Amended Note
Purchase Agreement and the Amended Notes; and
(c) has agreed or consented to cause or permit in the future (upon the
happening of a contingency or otherwise) any of its Property, whether now
owned or hereafter acquired, to be subject to a Lien not permitted by
Section 8.17 of the Amended Note Purchase Agreement.
3.15 Collateral.
(a) Collateral Documents.
(i) Mortgages. Each Mortgage creates a valid Lien upon the
grantor's right, title and interest in the real property and interests
described therein in favor of the Collateral Agent, and when such
document has been recorded as indicated on Schedule 3.15 and all
appropriate recording fees and taxes have been paid, such Lien shall
be a perfected first priority Lien subject to no other Liens except to
the extent permitted by Section 8.17 of the Amended Note Purchase
Agreement;
(ii) Security Agreement. The Security Agreement creates a valid
Lien in and to the Collateral (as defined in the Security Agreement)
in favor of the Collateral Agent, and when all UCC-1 financing
statements required by the Security Agreement to be filed with public
recording offices have been so filed, and all taxes, recording fees
and other fees and charges required by applicable law to be paid in
connection therewith have been duly paid in full, such Lien shall be a
perfected, first priority Lien on the Collateral of a type which may
be perfected by the filing of a UCC financing statement or by
possession, subject to no Liens except to the extent permitted by
Section 8.17 of the Amended Note Purchase Agreement;
(iii) Trademark/Copyright Security Agreement. The
Trademark/Copyright Security Agreement creates a valid Lien in and to
the Trademark Collateral, Copyright Collateral and Related Assets (as
such terms are defined in the Trademark/Copyright Security Agreement)
in favor of the Collateral Agent, and upon the filing thereof with the
United States Patent and Trademark Office or the United States
Copyright Office and the filing of UCC-1 financing statements
13
as therein provided for, such Lien will be a perfected first priority
Lien in and to the Trademark Collateral, Copyright Collateral and
Related Assets in which a Lien may be perfected by the filing of a UCC
financing statement or filing with the United States Patent and
Trademark Office or the United States Copyright Office, subject to no
Liens except to the extent permitted by Section 8.17 of the Amended
Note Purchase Agreement;
(iv) Stock Pledge Agreement. The Stock Pledge Agreement creates a
valid Lien in and to the Pledged Collateral (as defined in the Stock
Pledge Agreement) in favor of the Collateral Agent, and upon delivery
of certificates or instruments evidencing the Pledged Collateral to
the Collateral Agent and the filing of related UCC-1 Financing
Statements, such Lien will be a perfected first priority Lien in and
to such of the Pledged Collateral as to which a Lien may be perfected
by delivery, subject to no Liens except to the extent permitted by
Section 8.17 of the Amended Note Purchase Agreement; and
(v) Note Pledge Agreement. The Note Pledge Agreement creates a
valid Lien in and to the Pledged Collateral (as defined in the Note
Pledge Agreement) in favor of the Collateral Agent, and upon delivery
of the instrument or instruments evidencing the Pledged Collateral to
the Collateral Agent and the filing of related UCC-1 Financing
Statements, such Lien will be a perfected first priority Lien in and
to such of the Pledged Collateral as to which a Lien may be perfected
by delivery, subject to no Liens except to the extent permitted by
Section 8.17 of the Amended Note Purchase Agreement.
(b) Warranties and Representations True. All warranties and
representations made by the Company and the Restricted Subsidiaries in each
of the Security Documents are true and correct as of the date hereof.
3.16 Solvency.
After giving effect to the transactions contemplated by the Transaction
Documents, (a) the fair value and the fair salable value of the assets of the
Company and each Restricted Subsidiary (excluding any Debt due from any
Affiliate of the Company or such Restricted Subsidiary, as the case may be) will
each be in excess of the fair valuation of its total liabilities (including all
contingent liabilities), (b) the Company and each Restricted Subsidiary will be
able to pay its debts or other obligations in the ordinary course as they
mature, and (c) the Company and each Restricted Subsidiary has capital not
unreasonably small to
14
carry on its business and all business in which it proposes to be engaged.
4. CONDITIONS PRECEDENT
The amendments and the waivers set forth in Sections 2.1, 2.2 and 2.3 shall
become effective upon the satisfaction of the following conditions (the date of
such effectiveness is herein referred to as the "Effective Date"):
4.1 Certificates.
(a) Company Officer's Certificate. The Company shall have delivered to
the Noteholders (or their special counsel) a certificate signed by the
Chairman, the Vice Chairman, the President or the Executive Vice
President-Chief Financial Officer of the Company, dated the Effective Date,
certifying that (i) no Default or Event of Default under the Amended Note
Purchase Agreement exists and (ii) the representations and warranties set
forth in Section 3 and in each of the other Financing Documents (excluding,
however, for purposes of such officer's certificate, Section 2 of the
Amended Note Purchase Agreement) are true and correct on the Effective
Date. Such officer's certificate may expressly state that it is not
certifying as to the accuracy of the representations and warranties set
forth in Section 2 of the Amended Note Purchase Agreement.
(b) Company Secretary's Certificate. The Company shall have delivered
to the Noteholders a certificate signed by Secretary or one of the
Assistant Secretaries of the Company, dated the Effective Date, certifying
as true and correct copies of the Company's charter and by-laws and the
resolutions attached thereto and other corporate proceedings relating to
the authorization, execution and delivery of each of the Financing
Documents to which the Company is a party.
(c) Subsidiary Secretary's Certificates. Each Restricted Subsidiary
entering into one or more of the Financing Documents shall have delivered
to the Noteholders a certificate signed by the Secretary or one of the
Assistant Secretaries of such Restricted Subsidiary, dated the Effective
Date, certifying as true and correct copies of such Restricted Subsidiary's
charter and by-laws and the resolutions attached thereto and other
corporate proceedings relating to the authorization, execution and delivery
of the Financing Documents to which such Restricted Subsidiary is a party.
4.2 Opinions of Counsel.
The Noteholders shall have received opinions from
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(a) ▇▇▇▇▇ & ▇▇▇▇▇▇▇, special counsel for the Company and the
Restricted Subsidiaries,
(b) special local counsel for the Company and the Restricted
Subsidiaries in the States of Florida, Georgia, Illinois, Mississippi,
Ohio, New York, Tennessee and Washington, and
(c) ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, special counsel for the Collateral Agent,
each dated as of the Effective Date, substantially in the respective forms set
forth in Exhibit B1, Exhibit B2 and Exhibit B3, and as to such other matters as
the Noteholders may reasonably request. The Noteholders also shall have received
an opinion from ▇▇▇▇▇▇▇ ▇▇▇▇ LLP, special counsel for the Noteholders, in form
and substance satisfactory to the Noteholders.
4.3 Omnibus Collateral Agreement.
The Omnibus Collateral Agreement, in the form of Exhibit C hereto (the
"Omnibus Collateral Agreement"), shall be duly executed and delivered to the
Noteholders (or their special counsel) by the Company and each of the Restricted
Subsidiaries identified on the signature pages thereto.
4.4 Guaranty Agreement.
The Guaranty Agreement, in the form of Exhibit D hereto (the "Guaranty
Agreement"), shall be duly executed by each of the Restricted Subsidiaries
identified on the signature pages thereto in favor of the Collateral Agent and
delivered to the Noteholders (or their special counsel).
4.5 1995 Second Amendment.
The Company and the 1995 Noteholders shall have executed and delivered to
the Noteholders (or their special counsel) a counterpart of the 1995 Second
Amendment.
4.6 Fifth Amendment to Credit Agreement.
The Company, the Banks and the Agent shall have executed and delivered to
the Noteholders (or their special counsel) a copy of the Fifth Amendment, which
shall be in form and substance satisfactory to the Noteholders and their special
counsel.
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4.7 Letter of Credit Documents.
The Company shall have executed and delivered to the Noteholders (or their
special counsel) a copy of each of the following Letter of Credit documents:
(a) the B of A Reimbursement Agreement,
(b) PNC Reimbursement Agreement One, and
(c) PNC Reimbursement Agreement Two,
each of which shall be in form and substance satisfactory to the Noteholders and
their special counsel.
4.8 Other Related Matters.
The Company shall have delivered a letter addressed to the Noteholders with
respect to certain other matters relating to the Transaction Documents the
receipt of which shall have been acknowledged by special counsel to the
Noteholders.
4.9 Intercreditor Agreement.
The Banks, the 1995 Noteholders, the L/C Issuers, State Street Bank and
Trust Company, the Company, the Owner Trustee, the Indenture Trustee and each of
the Restricted Subsidiaries identified on the signature pages thereto, shall
have delivered to the Noteholders (or their special counsel) a fully executed
counterpart of the Collateral Agency and Intercreditor Agreement, in form
attached hereto as Exhibit E (the "Intercreditor Agreement").
4.10 Security Documents.
(a) Mortgages. Separate Mortgages and Deeds of Trust, substantially in
the form of Exhibit F1 through Exhibit F7 hereto (collectively, the
"Mortgages"), relating to real properties of the Company and certain
Restricted Subsidiaries located in the States of Alabama, Florida,
Illinois, Mississippi, Ohio, Tennessee and Washington, shall be duly
executed and delivered to the Collateral Agent, and a copy
17
of each thereof evidencing such due execution and delivery shall be
delivered to the Noteholders (or their special counsel).
(b) Security Agreement. A Security Agreement, substantially in the
form of Exhibit G hereto (the "Security Agreement"), shall be duly executed
and delivered by the Company, each of the Restricted Subsidiaries
identified on the signature pages thereto, and the Collateral Agent, and a
copy of each thereof evidencing such due execution and delivery shall be
delivered to the Noteholders (or their special counsel).
(c) Trademark/Copyright Security Agreement. A Trademark and Copyright
Collateral Assignment and Security Agreement (the "Trademark/Copyright
Security Agreement"), substantially in the form of Exhibit H hereto, shall
be duly executed and delivered by the Company, each of the Restricted
Subsidiaries identified on the signature pages thereto, and the Collateral
Agent, and a copy thereof evidencing such due execution and delivery shall
be delivered to the Noteholders (or their special counsel).
(d) Stock Pledge Agreement. The Stock Pledge Agreement, substantially
in the form of Exhibit I hereto (the "Stock Pledge Agreement"), shall be
duly executed and delivered by the Company, each of the Restricted
Subsidiaries identified on the signature pages thereto, and the Collateral
Agent, and a copy of each thereof evidencing such due execution and
delivery shall be delivered to the Noteholders (or their special counsel).
All stock certificates and undated stock powers executed in blank required
to be executed and delivered to the Collateral Agent by the terms of the
Stock Pledge Agreement shall have been so delivered, and the Company shall
provide the Noteholders with copies thereof.
(e) Note Pledge Agreement. A Note Pledge Agreement, substantially in
the form of Exhibit J hereto (the "Note Pledge Agreement"), shall be duly
executed and delivered by the Company and the Collateral Agent, and a copy
thereof evidencing such due execution and delivery shall be delivered to
the Noteholders (or their special counsel). The instrument or instruments
evidencing the Pledged Collateral (as defined in the Note Pledge Agreement)
and a power of attorney executed by the Company required to be executed and
delivered by the Company to the Collateral Agent by the terms of the Note
Pledge Agreement shall have been so delivered, and the Company shall
provide the Noteholders (or their special counsel) with a copy thereof.
(f) Perfection of Liens. The Company and each Restricted Subsidiary
that has entered into a Security Document shall have executed and delivered
to the Collateral Agent all UCC-1 financing statements as are necessary to
perfect the Liens of the Collateral Agent in the Collateral which may be
perfected by the filing thereof .
(g) Title Matters. With respect to each of the Mortgages, the Company
shall have delivered or caused to be delivered to the Collateral Agent one
or more loan policies of title insurance, or commitment therefor,
18
satisfactory to you and showing no exceptions to title except as reasonably
acceptable to the Noteholders (or their special counsel).
(h) Certificates of Insurance. The Company shall have delivered to the
Noteholders (or their special counsel) certificates of insurance evidencing
the insurance required by the Security Documents, showing the Collateral
Agent as loss payee (as its interest may appear) thereunder.
(i) Taxes. All taxes, fees and other charges payable in connection
with the execution, delivery, recording, filing and registration of the
Security Documents shall have been paid or provision for such payment shall
have been made to the reasonable satisfaction of the Noteholders (or their
special counsel).
4.11 Lien Searches.
The Noteholders (or their special counsel) shall have received Lien
searches showing that the Collateral (as defined in the Security Agreement) of
the Company and the Subsidiaries is subject to no Liens other than Liens
permitted under Section 8.17 of the Amended Note Purchase Agreement.
4.12 Restructuring Fee.
The Company shall have paid to the Noteholders an aggregate of Two Hundred
Sixty Thousand Dollars ($260,000) as a restructuring fee in respect of the
transactions contemplated by this Agreement. Such payment shall be made to the
Noteholders in proportion, as nearly as practicable, to the respective unpaid
principal amount of Existing Notes held by each Noteholder on the Effective
Date, in the manner provided in the Existing Note Purchase Agreement for the
payment of principal.
4.13 Private Placement Number.
A private placement number issued by Standard & Poor's CUSIP Service Bureau
(in cooperation with the Securities Valuation Office of the National Association
of Insurance Commissioners) shall have been obtained for the Notes.
4.14 Payment of Special Counsel and Financial Advisor Fees.
Without limiting the provisions of Section 5.3, the Company shall have paid
on or before the Effective Date the fees, charges and disbursements of the
Noteholders' special counsel referred to in Section 4.2, and Nightingale
Associates, LLC, in each case to the extent reflected in statements rendered to
the Company on or prior to the Effective Date.
19
4.15 Lease Letters.
Letters from the owner participants and the debt participants in respect of
the Equipment Lease Agreement dated as of September 30, 1997, as amended, shall
have been delivered to the Noteholders (or their special counsel), in form,
scope and substance satisfactory to the Noteholders and their special counsel.
4.16 Proceedings and Documents Satisfactory.
All opinions, certificates and other instruments and all proceedings taken
in connection with the execution and delivery of this Agreement and the
transactions contemplated hereby shall be reasonably satisfactory to the
Noteholders and their special counsel; and the Noteholders and their special
counsel shall have received copies of such documents and papers as may be
reasonably requested in connection therewith.
5. MISCELLANEOUS
5.1 Effect of Amendment and Waiver.
If the foregoing is acceptable to you, please note your acceptance in the
space provided below. Upon the execution and delivery of this Agreement by each
of the Noteholders and the Company, the conditions set forth in Section 4 shall
be deemed satisfied or waived and the Existing Note Purchase Agreement shall be
deemed to be amended and restated as set forth above and the waivers as set
forth above shall be deemed to be effective. This Agreement shall be binding
upon, and shall inure to the benefit of, the permitted successors and assigns of
the parties hereto and the holders from time to time of the Amended Notes.
5.2 No Legend Required.
Any and all notices, requests, certificates and other instruments
including, without limitation, the Amended Notes, may refer to the Note Purchase
Agreement or the Note Purchase Agreement dated as of September 1, 1993 without
making specific reference to this Waiver and Third Amendment to Note Purchase
Agreement, but nevertheless all such references shall be deemed to include this
Waiver and Third Amendment to Note Purchase Agreement unless the context shall
otherwise require.
5.3 Fees and Expenses.
Whether or not the transactions herein contemplated shall be consummated,
the Company agrees to pay directly all reasonable out-of-pocket travel expenses
and other reasonable out-of-pocket expenses of the Noteholders in connection
with the
20
preparation, negotiation, execution and delivery of the Financing Documents and
the Amended Note Purchase Agreement, and the transactions contemplated hereby
and thereby, including, but not limited to, the reasonable fees and
disbursements of ▇▇▇▇▇▇▇ ▇▇▇▇ LLP, the Noteholders' special counsel, and
Nightingale Associates, LLC, financial advisor to the Noteholders and the 1995
Noteholders, photocopying costs, and charges for shipping the Amended Notes,
adequately insured, to each Noteholder at its home office or at such other place
as such Noteholder may designate, and so long as any Noteholder shall hold any
of the Amended Notes, all such expenses relating to any amendments, waivers or
consents pursuant to the provisions of the Amended Note Purchase Agreement,
including, without limitation, any amendments, waivers or consents resulting
from any work-out, restructuring or similar events relating to the performance
by the Company and the Restricted Subsidiaries of their respective obligations
under the Financing Documents, the Amended Note Purchase Agreement and the
Amended Notes. The Company also agrees that it will pay and save each Noteholder
harmless against any and all liability with respect to stamp and other similar
taxes, if any, which may be payable or which may be determined to be payable in
connection with the execution and delivery of the Financing Documents, the
Amended Note Purchase Agreement and the Amended Notes, whether or not any
Amended Notes are then outstanding. The Company agrees to protect and indemnify
each Noteholder against any liability for any and all brokerage fees and
commissions payable or claimed to be payable to any Person retained by the
Company, their Subsidiaries, or any of their respective Affiliates that are
controlled by the Company in connection with the transactions contemplated by
this Agreement. Without limiting the foregoing, the Company agrees to pay the
costs of obtaining a private placement number for the Amended Notes, and
authorizes the submission of such information as may be required by the CUSIP
Service Bureau of Standard & Poor's for the purpose of obtaining such a number.
5.4 Survival.
All warranties, representations, certifications and covenants made by the
Company in this Agreement or in any certificate or other instrument delivered by
it or on its behalf under this Agreement shall be considered to have been relied
upon by the Noteholders and shall survive the execution of this Agreement,
regardless of any investigation made by or on behalf of the Noteholders. All
statements in any such certificate or other instrument shall constitute
warranties and representations of the Company under this Agreement.
5.5 Duplicate Originals; Execution in Counterpart.
Two or more duplicate originals of this Agreement may be signed by the
parties, each of which shall be an original but all of which together shall
constitute
21
one and the same instrument. This Agreement may be executed in one or more
counterparts and shall be effective when at least one counterpart shall have
been executed by each party to this Agreement, and each set of counterparts
which, collectively, show execution by each such party to this Agreement shall
constitute one duplicate original.
5.6 Release of Claims.
The Company, for itself and all of its predecessors, successors and
assigns, acknowledges, affirms and represents that immediately prior to giving
effect to this Agreement, it is legally, validly and enforceably obligated to
each of the Noteholders under and pursuant to the Existing Notes and the
Existing Note Purchase Agreement and that the Company has no defense, offset,
counterclaim or right of recoupment with regard to such obligations.
Additionally, the Company for itself and all of its predecessors, successors and
assigns, does hereby fully, forever and completely release and discharge each of
the Noteholders and all of their respective employees, officers, directors,
trustees, shareholders, affiliates, agents, attorneys, representatives,
predecessors, successors and assigns (collectively, the "Released Parties"),
from any and all claims, demands, liabilities, damages and causes of action of
any kind whatsoever, whether based on facts in existence prior to or as of the
date hereof, whether known or unknown, which the Company may now have or may
have had at any time heretofore or may have at anytime hereafter, whether for
contribution or indemnity or otherwise, and whether direct or indirect, fixed or
contingent, liquidated or unliquidated, arising out of or related in any way to
any of the following: (a) the Existing Notes and the Existing Note Purchase
Agreement and all documents relating thereto or executed in connection therewith
(the "Existing Note Documents"); and (b) any action, inaction or omission by any
of the Released Parties in connection with the Existing Note Documents or the
administration thereof.
5.7 Governing Law.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND SHALL BE GOVERNED
BY THE INTERNAL LAWS OF THE STATE OF NEW YORK.
[Remainder of page intentionally left blank; next page is signature page.]
22
If you are in agreement with the foregoing, please sign the form of
acceptance in the space provided below, whereupon the foregoing shall become a
binding agreement between you and the Company as of the date first above
written.
BIRMINGHAM STEEL CORPORATION
By:
----------------------------
Name:
Title:
Accepted:
PRINCIPAL LIFE INSURANCE COMPANY
(f/k/a Principal Mutual Life Insurance
Company)
By: Principal Capital Management, LLC
a Delaware limited liability company,
its authorized signatory
By
-----------------------------------
Name:
Title:
By
-----------------------------------
Name:
Title:
THE EQUITABLE LIFE ASSURANCE SOCIETY
OF THE UNITED STATES
By
-----------------------------------
Name:
Title:
JEFFERSON-PILOT LIFE INSURANCE
COMPANY
By
-----------------------------------
Name:
Title:
AMERICAN UNITED LIFE INSURANCE
COMPANY
By
-----------------------------------
Name:
Title:
THE STATE LIFE INSURANCE COMPANY
By
-----------------------------------
Name:
Title:
GREAT-WEST LIFE & ANNUITY INSURANCE
COMPANY
By
-----------------------------------
Name:
Title:
By
-----------------------------------
Name:
Title:
THE GREAT-WEST LIFE ASSURANCE
COMPANY
By
-----------------------------------
Name:
Title:
By
-----------------------------------
Name:
Title:
J. ROMEO & CO. as nominee for MONY LIFE
INSURANCE COMPANY OF NEW YORK
By
-----------------------------------
Name:
Title:
TEACHERS INSURANCE AND ANNUITY
ASSOCIATION OF AMERICA
By
-----------------------------------
Name:
Title:
PHOENIX HOME LIFE MUTUAL INSURANCE
COMPANY
By
-----------------------------------
Name:
Title:
CANADA LIFE ASSURANCE COMPANY
By
-----------------------------------
Name:
Title:
CANADA LIFE ASSURANCE COMPANY OF
NEW YORK
By
-----------------------------------
Name:
Title:
CANADA LIFE INSURANCE COMPANY OF
AMERICA
By
-----------------------------------
Name:
Title:
AMERITAS LIFE INSURANCE CORP.
By Ameritas Investment Advisors Inc.,
as Agent
By
-----------------------------------
Name:
Title:
BERKSHIRE LIFE INSURANCE COMPANY
By
-----------------------------------
Name:
Title:
PROVIDENT MUTUAL LIFE INSURANCE
COMPANY
By
-----------------------------------
Name:
Title: