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QUANTA SERVICES, INC.
$73,000,000 8.46% Series 2000-A Senior Secured Notes, Tranche 1,
due March 1, 2005
and
$41,500,000 8.55% Series 2000-A Senior Secured Notes, Tranche 2,
due March 1, 2007
and
$35,500,000 8.61% Series 2000-A Senior Secured Notes, Tranche 3,
due March 1, 2010
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NOTE PURCHASE AGREEMENT
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DATED AS OF MARCH 1, 2000
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TABLE OF CONTENTS
SECTION HEADING PAGE
SECTION 1. AUTHORIZATION OF NOTES.................................................................1
SECTION 2. SALE AND PURCHASE OF NOTES.............................................................2
Section 2.1. Series 2000-A Notes....................................................................2
Section 2.2. Guaranty Agreement.....................................................................2
Section 2.3. Security for the Notes.................................................................2
Section 2.4. Additional Series of Notes.............................................................3
SECTION 3. CLOSING................................................................................4
SECTION 4. CONDITIONS TO CLOSING..................................................................4
Section 4.1. Representations and Warranties.........................................................4
Section 4.2. Representations and Warranties.........................................................4
Section 4.3. Performance; No Default................................................................4
Section 4.4. Compliance Certificates................................................................5
Section 4.5. Guaranty Agreement.....................................................................5
Section 4.6. Security Documents, Etc................................................................5
Section 4.7. Filing.................................................................................5
Section 4.8. Intercreditor Agreement................................................................5
Section 4.9. Insurance..............................................................................6
Section 4.10. Pledged Stock..........................................................................6
Section 4.11. Opinions of Counsel....................................................................6
Section 4.12. Purchase Permitted by Applicable Law, Etc..............................................6
Section 4.13. Related Transactions...................................................................6
Section 4.14. Payment of Special Counsel Fees........................................................6
Section 4.15. Private Placement Number...............................................................6
Section 4.16. Changes in Corporate Structure.........................................................7
Section 4.17. Proceedings and Documents..............................................................7
Section 4.18. Conditions to Issuance of Additional Notes.............................................7
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY..........................................7
Section 5.1. Organization; Power and Authority......................................................7
Section 5.2. Authorization, Etc.....................................................................8
Section 5.3. Disclosure.............................................................................8
Section 5.4. Organization and Ownership of Shares of Subsidiaries; Affiliates.......................8
Section 5.5. Financial Statements...................................................................9
Section 5.6. Compliance with Laws, Other Instruments, Etc...........................................9
Section 5.7. Governmental Authorizations, Etc......................................................10
Section 5.8. Litigation; Observance of Statutes and Orders.........................................10
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Section 5.9. Taxes.................................................................................10
Section 5.10. Title to Property; Leases.............................................................10
Section 5.11. Licenses, Permits, Etc................................................................11
Section 5.12. Compliance with ERISA.................................................................11
Section 5.13. Private Offering by the Company.......................................................12
Section 5.14. Use of Proceeds; Margin Regulations...................................................12
Section 5.15. Existing Debt; Future Liens...........................................................12
Section 5.16. Foreign Assets Control Regulations, Etc...............................................13
Section 5.17. Status under Certain Statutes.........................................................13
Section 5.18. Environmental Matters.................................................................13
Section 5.19. Filing and Recordation................................................................14
Section 5.20. Other Representations and Warranties..................................................14
SECTION 6. REPRESENTATIONS OF THE PURCHASER......................................................14
Section 6.1. Purchase for Investment...............................................................14
Section 6.2. Source of Funds.......................................................................14
Section 6.3. Disclosure of Information.............................................................16
Section 6.4. Investment Experience.................................................................16
Section 6.5. Accredited Investor...................................................................16
SECTION 7. INFORMATION AS TO COMPANY.............................................................16
Section 7.1. Financial and Business Information....................................................16
Section 7.2. Officer's Certificate.................................................................18
Section 7.3. Inspection............................................................................19
SECTION 8. PREPAYMENT OF THE NOTES...............................................................20
Section 8.1. Required Prepayments..................................................................20
Section 8.2. Optional Prepayments with Make-Whole Amount...........................................20
Section 8.3. Allocation of Partial Prepayments.....................................................20
Section 8.4. Maturity; Surrender, Etc..............................................................20
Section 8.5. Purchase of Notes.....................................................................21
Section 8.6. Make-Whole Amount for Series 2000-A Notes.............................................21
Section 8.7. Change in Control.....................................................................22
SECTION 9. AFFIRMATIVE COVENANTS.................................................................24
Section 9.1. Compliance with Law...................................................................24
Section 9.2. Insurance.............................................................................24
Section 9.3. Maintenance of Properties.............................................................25
Section 9.4. Payment of Taxes and Claims...........................................................25
Section 9.5. Corporate Existence, Etc..............................................................25
Section 9.6. Guaranty by Subsidiaries..............................................................25
SECTION 10. NEGATIVE COVENANTS....................................................................26
Section 10.1. Consolidated Net Worth................................................................26
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Section 10.2. Limitation on Consolidated Debt.......................................................26
Section 10.3. Limitation on Priority Debt...........................................................26
Section 10.4. Interest Charges Coverage Ratio.......................................................26
Section 10.5. Limitation on Liens...................................................................26
Section 10.6. Merger, Consolidation.................................................................28
Section 10.7. Sales of Assets.......................................................................29
Section 10.8. Nature of Business....................................................................29
Section 10.9. Transactions with Affiliates..........................................................29
Section 10.10. Further Assurances....................................................................30
SECTION 11. EVENTS OF DEFAULT.....................................................................30
SECTION 12. REMEDIES ON DEFAULT, ETC..............................................................32
Section 12.1. Acceleration..........................................................................32
Section 12.2. Other Remedies........................................................................33
Section 12.3. Rescission............................................................................33
Section 12.4. No Waivers or Election of Remedies, Expenses, Etc.....................................34
SECTION 13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.........................................34
Section 13.1. Registration of Notes.................................................................34
Section 13.2. Transfer and Exchange of Notes........................................................34
Section 13.3. Replacement of Notes..................................................................35
SECTION 14. PAYMENTS ON NOTES.....................................................................35
Section 14.1. Place of Payment......................................................................35
Section 14.2. Home Office Payment...................................................................35
SECTION 15. EXPENSES, ETC.........................................................................36
Section 15.1. Transaction Expenses..................................................................36
Section 15.2. Survival..............................................................................36
SECTION 16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT..........................36
SECTION 17. AMENDMENT AND WAIVER..................................................................37
Section 17.1. Requirements..........................................................................37
Section 17.2. Solicitation of Holders of Notes......................................................37
Section 17.3. Binding Effect, Etc...................................................................38
Section 17.4. Notes Held by Company, Etc............................................................38
SECTION 18. NOTICES...............................................................................38
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SECTION 19. REPRODUCTION OF DOCUMENTS.............................................................39
SECTION 20. CONFIDENTIAL INFORMATION..............................................................39
SECTION 21. SUBSTITUTION OF PURCHASER.............................................................40
SECTION 22. MISCELLANEOUS.........................................................................41
Section 22.1. Successors and Assigns................................................................41
Section 22.2. Payments Due on Non-Business Days.....................................................41
Section 22.3. Severability..........................................................................41
Section 22.4. Construction..........................................................................41
Section 22.5. Counterparts..........................................................................41
Section 22.6. Governing Law.........................................................................41
Section 22.7. Legal Rate of Interest................................................................41
Section 22.8. Submission to Process.................................................................42
Section 22.9. Waivers by the Company................................................................43
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SCHEDULE A -- INFORMATION RELATING TO PURCHASERS
SCHEDULE B -- DEFINED TERMS
SCHEDULE 4.16 -- Changes in Corporate Structure
SCHEDULE 5.4 -- Subsidiaries of the Company and Ownership of Subsidiary Stock
SCHEDULE 5.5 -- Financial Statements
SCHEDULE 5.11 -- Licenses, Permits, Etc.
SCHEDULE 5.15 -- Existing Debt
SCHEDULE 10.5 -- Existing Liens
EXHIBIT 1(a) -- Form of 8.46% Series 2000-A Senior Secured Note, Tranche 1, due March 1, 2005
EXHIBIT 1(b) -- Form of 8.55% Series 2000-A Senior Secured Note, Tranche 2, Due March 1, 2007
EXHIBIT 1(c) -- Form of 8.61% Series 2000-A Senior Secured Note, Tranche 3, Due March 1, 2010
EXHIBIT 2 -- Form of Guaranty Agreement
EXHIBIT 3 -- Form of Intercreditor Agreement
EXHIBIT 4.11(a) -- Form of Opinion of General Counsel for the Company
EXHIBIT 4.11(b) -- Form of Opinion of Special Counsel for the Company
EXHIBIT 4.11(c) -- Form of Opinion of Special Counsel for the Purchasers
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QUANTA SERVICES, INC.
1360 POST OAK BOULEVARD, SUITE 2100
HOUSTON, TEXAS 77056-3023
8.46% SERIES 2000-A SENIOR SECURED NOTES, TRANCHE 1, DUE MARCH 1, 2005
AND
8.55% SERIES 2000-A SENIOR SECURED NOTES, TRANCHE 2, DUE MARCH 1, 2007
AND
8.61% SERIES 2000-A SENIOR SECURED NOTES, TRANCHE 3, DUE MARCH 1, 2010
Dated as of
March 1, 2000
TO THE PURCHASERS LISTED IN
THE ATTACHED SCHEDULE A:
Ladies and Gentlemen:
QUANTA SERVICES, INC., a Delaware corporation (the "Company"), agrees
with the Purchasers listed in the attached Schedule A (the "Purchasers") to this
Note Purchase Agreement (this "Agreement") as follows:
SECTION 1. AUTHORIZATION OF NOTES.
The Company will authorize the issue and sale of (i) $73,000,000
aggregate principal amount of its 8.46% Series 2000-A Senior Secured Notes,
Tranche 1, due March 1, 2005 (the "Tranche 1 Notes"), (ii) $41,500,000 aggregate
principal amount of its 8.55% Series 2000-A Senior Secured Notes, Tranche 2, due
March 1, 2007 (the "Tranche 2 Notes"), and (iii) $35,500,000 aggregate principal
amount of its 8.61% Series 2000-A Senior Secured Notes, Tranche 3, due March 1,
2010 (the "Tranche 3 Notes"; the Tranche 1 Notes, the Tranche 2 Notes and the
Tranche 3 Notes are collectively referred to herein as the "Series 2000-A
Notes"). The Series 2000-A Notes together with each Series of Additional Notes
which may from time to time be issued pursuant to the provisions of Section 2.4
are collectively referred to as the "Notes" (such term shall also include any
such notes issued in substitution therefor pursuant to Section 13 of this
Agreement). The Series 2000-A Notes shall be substantially in the forms set out
in Exhibit 1(a), Exhibit 1(b) and Exhibit 1(c), respectively, with such changes
therefrom, if any, as may be approved by the Purchasers and the Company. Certain
capitalized terms used in this Agreement are defined in Schedule B; references
to a "Schedule" or an "Exhibit" are, unless otherwise specified, to a Schedule
or an Exhibit attached to this Agreement.
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SECTION 2. SALE AND PURCHASE OF NOTES.
Section 2.1. Series 2000-A Notes. Subject to the terms and conditions
of this Agreement, the Company will issue and sell to each Purchaser and each
Purchaser will purchase from the Company, at the Closing provided for in Section
3, Series 2000-A Notes in the principal amount specified opposite such
Purchaser's name in Schedule A at the purchase price of 100% of the principal
amount thereof. The obligations of each Purchaser hereunder are several and not
joint obligations and each Purchaser shall have no obligation and no liability
to any Person for the performance or nonperformance by any other Purchaser
hereunder.
Section 2.2. Guaranty Agreement. The payment by the Company of all
amounts due with respect to the Notes and the performance by the Company of its
obligations under this Agreement will be unconditionally guaranteed by all
Domestic Subsidiaries of the Company (the "Guarantors") under the Guaranty
Agreement dated as of March 1, 2000 (the "Guaranty Agreement") which shall be in
substantially the form attached hereto as Exhibit 2.
If at any time one or more Subsidiaries which has guaranteed the Notes
and the Debt outstanding under the Bank Credit Agreement shall have been
released from its obligations under the Guaranty relating to the Bank Credit
Agreement, then upon delivery to the holders of the Notes of evidence of such
release (which evidence shall be reasonably satisfactory to the Required
Holders) and provided that no Default or Event of Default shall exist, the
Required Holders shall execute and deliver a release of such Subsidiary from its
obligations under the Guaranty Agreement (referred to as a "Guaranty Release
Event").
Section 2.3. Security for the Notes. The Notes will be secured by
certain property of the Company and the Guarantors pursuant to the Security
Documents heretofore entered into by the Company and the Guarantors with Bank of
America, N.A. as collateral agent (together with any successor collateral agent,
the "Collateral Agent") for the benefit of the holders of Notes and the Bank
Lenders.
The Lien and security interest granted by the Company and the
Guarantors pursuant to the Security Documents shall rank pari passu with other
existing Liens that secure the outstanding Debt of the Company and the
Guarantors under the Bank Credit Agreement without preference, priority or
distinction by virtue of the time of filing any financing statement or
registration or the difference in time of incurrence of such Debt, and the
enforcement of the rights and benefits in respect of such Security Documents
will be subject to an Intercreditor Agreement dated as of March 1, 2000 (the
"Intercreditor Agreement") among the Collateral Agent, for itself and as agent
on behalf of all Bank Lenders, the Purchasers and the Additional Purchasers.
If at any time the Collateral Agent shall have received the written
direction from the requisite percentage of Bank Lenders to release the Liens of
the Security Documents which secure the Debt outstanding under the Bank Credit
Agreement, then upon delivery to the holders of the Notes of evidence of such
direction (which evidence shall be reasonably satisfactory to the Required
Holders) and provided that no Default or Event of Default shall exist, the
Collateral Agent shall release the Liens created by the Security Documents
(herein referred to as a "Collateral Release Event"). If requested by the
Collateral Agent and so long as no Default or
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Event of Default shall exist, each Purchaser, each Additional Purchaser and each
holder by its acceptance of a Note agrees that it shall concur in the Collateral
Release Event.
Section 2.4. Additional Series of Notes. The Company may, from time to
time, in its sole discretion but subject to the terms hereof, issue and sell one
or more additional Series of its secured promissory notes under the provisions
of this Agreement pursuant to a supplement (a "Supplement") substantially in the
form of Exhibit S. Each additional Series of Notes (the "Additional Notes")
issued pursuant to a Supplement shall be subject to the following terms and
conditions:
(i) each Series of Additional Notes, when so issued, shall be
differentiated from all previous Series by sequential alphabetical
designation inscribed thereon;
(ii) Additional Notes of the same Series may consist of more
than one different and separate tranches and may differ with respect to
outstanding principal amounts, maturity dates, interest rates and
premiums, if any, and price and terms of redemption or payment prior to
maturity, but all such different and separate tranches of the same
Series shall vote as a single class and constitute one Series;
(iii) each Series of Additional Notes shall be dated the date
of issue, bear interest at such rate or rates, mature on such date or
dates, be subject to such mandatory and optional prepayment on the
dates and at the premiums, if any, have such additional or different
conditions precedent to closing, such representations and warranties
and such additional covenants as shall be specified in the Supplement
under which such Additional Notes are issued and upon execution of any
such Supplement, this Agreement shall be amended (a) to reflect such
additional covenants without further action on the part of the holders
of the Notes outstanding under this Agreement, provided, that any such
additional covenants shall inure to the benefit of all holders of Notes
so long as any Additional Notes issued pursuant to such Supplement
remain outstanding, and (b) to reflect such representations and
warranties as are contained in such Supplement for the benefit of the
holders of such Additional Notes in accordance with the provisions of
Section 16;
(iv) each Series of Additional Notes issued under this
Agreement shall be in substantially the form of Exhibit 1 to Exhibit S
hereto with such variations, omissions and insertions as are necessary
or permitted hereunder;
(v) the minimum principal amount of any Note issued under a
Supplement shall be $100,000, except as may be necessary to evidence
the outstanding amount of any Note originally issued in a denomination
of $100,000 or more;
(vi) all Additional Notes shall constitute Senior Debt of the
Company and shall rank pari passu with all other outstanding Notes,
provided that if the Security Documents and the Intercreditor Agreement
are in full force and effect, the Company shall have obtained the
written consent of the necessary parties to the Intercreditor Agreement
as provided for therein; and
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(vii) no Additional Notes shall be issued hereunder if at the
time of issuance thereof and after giving effect to the application of
the proceeds thereof, any Default or Event of Default shall have
occurred and be continuing.
SECTION 3. CLOSING.
The sale and purchase of the Series 2000-A Notes to be purchased by
each Purchaser shall occur at the offices of Chapman and Cutler, 111 West Monroe
Street, Chicago, Illinois 60603 at 10:00 a.m. Chicago time, at a closing (the
"Closing") on March 22, 2000 or on such other Business Day thereafter on or
prior to March 24, 2000 as may be agreed upon by the Company and the Purchasers.
At the Closing the Company will deliver to each Purchaser the Series 2000-A
Notes to be purchased by such Purchaser in the form of a single Series 2000-A
Note (or such greater number of Series 2000-A Notes in denominations of at least
$100,000 as such Purchaser may request) dated the date of the Closing and
registered in such Purchaser's name (or in the name of such Purchaser's
nominee), against delivery by such Purchaser to the Company or its order of
immediately available funds in the amount of the purchase price therefor by wire
transfer of immediately available funds for the account of the Company to
account number 001390029677, account name Quanta Services, Inc., at Bank of
America, Dallas, Texas, ABA Number 111000025. If at the Closing the Company
shall fail to tender such Notes to any Purchaser as provided above in this
Section 3, or any of the conditions specified in Section 4 shall not have been
fulfilled to any Purchaser's satisfaction, such Purchaser shall, at such
Purchaser's election, be relieved of all further obligations under this
Agreement, without thereby waiving any rights such Purchaser may have by reason
of such failure or such nonfulfillment.
SECTION 4. CONDITIONS TO CLOSING.
The obligation of each Purchaser to purchase and pay for the Series
2000-A Notes to be sold to such Purchaser at the Closing is subject to the
fulfillment to such Purchaser's satisfaction, prior to or at the Closing, of the
following conditions:
Section 4.1. Representations and Warranties of the Company. The
representations and warranties of the Company in this Agreement shall be correct
when made and at the time of Closing.
Section 4.2. Representations and Warranties of the Guarantors. The
representations and warranties of the Guarantors in the Guaranty Agreement shall
be correct when made and at the time of the Closing.
Section 4.3. Performance; No Default. The Company and the Guarantors
shall have performed and complied with all agreements and conditions contained
in this Agreement required to be performed or complied with by the Company and
the Guarantors prior to or at the Closing, and after giving effect to the issue
and sale of the Series 2000-A Notes (and the application of the proceeds thereof
as contemplated by Section 5.14), no Default or Event of Default shall have
occurred and be continuing. Neither the Company nor any Subsidiary shall
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have entered into any transaction since the date of the Memorandum that would
have been prohibited by Section 10 hereof had such Sections applied since such
date.
Section 4.4. Compliance Certificates.
(a) Officer's Certificate of the Company. The Company shall
have delivered to such Purchaser an Officer's Certificate, dated the
date of the Closing, certifying that the conditions specified in
Sections 4.1, 4.3 and 4.16 have been fulfilled.
(b) Secretary's Certificate of the Company. The Company shall
have delivered to such Purchaser a certificate certifying as to the
resolutions attached thereto and other corporate proceedings relating
to the authorization, execution and delivery of the Series 2000-A Notes
and this Agreement.
(c) Officer's Certificate of the Guarantors. Each Guarantor
shall have delivered to such Purchaser an Officer's Certificate, dated
the date of the Closing, certifying that the conditions specified in
Sections 4.2 and 4.3 have been fulfilled.
(d) Secretary's Certificate of the Guarantors. Each Guarantor
shall have delivered to such Purchaser a certificate certifying as to
the resolutions attached thereto and other corporate proceedings
relating to the authorization, execution and delivery of the Guaranty
Agreement.
Section 4.5. Guaranty Agreement. The Guaranty Agreement shall have been
duly authorized, executed and delivered by the Guarantors, shall constitute the
legal, valid and binding contract and agreement enforceable against the
respective Guarantors in accordance with its terms and such Purchaser shall have
received a true, correct and complete copy thereof.
Section 4.6. Security Documents, Etc. The Security Documents shall have
been duly authorized, executed and delivered by the respective parties thereto,
shall constitute legal, valid and binding contracts and agreements enforceable
against the respective parties in accordance with their terms and such Purchaser
shall have received true, correct and complete copies of each thereof.
Section 4.7. Filing. The Security Documents (together with any
financing statements) shall have been duly filed in such public offices as may
be deemed necessary or appropriate by such Purchaser or such Purchaser's special
counsel in order to perfect the Liens granted or conveyed thereby.
Section 4.8. Intercreditor Agreement. The Intercreditor Agreement
substantially in the form of Exhibit 3 attached hereto shall have been executed
and delivered by the respective parties thereto and shall be in full force and
effect and such Purchaser shall have received a true, correct and complete copy
thereof.
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Section 4.9. Insurance. Certificates of insurance evidencing the
insurance policies required to be delivered pursuant to the Security Documents
shall be satisfactory in scope and form to such Purchaser and shall have been
delivered to the Collateral Agent and such Purchaser.
Section 4.10. Pledged Stock. The certificates representing the Pledged
Stock (together with duly executed undated stock powers endorsed in blank) shall
have been delivered to the Collateral Agent.
Section 4.11. Opinions of Counsel. Such Purchaser shall have received
opinions in form and substance satisfactory to such Purchaser, dated the date of
the Closing (a) from Brad Eastman, Esq., General Counsel of the Company,
covering the matters set forth in Exhibit 4.11(a) and covering such other
matters incident to the transactions contemplated hereby as such Purchaser or
such Purchaser's counsel may reasonably request (and the Company hereby
instructs its counsel to deliver such opinion to such Purchaser), (b) from Akin,
Gump, Strauss, Hauer & Feld, L.L.P., Special Counsel of the Company, covering
the matters set forth in Exhibit 4.11(b) and covering such other matters
incident to the transactions contemplated hereby as such Purchaser or such
Purchaser's counsel may reasonably request (and the Company hereby instructs its
counsel to deliver such opinion to such Purchaser), and (c) from Chapman and
Cutler, the Purchasers' special counsel in connection with such transactions,
substantially in the form set forth in Exhibit 4.11(c) and covering such other
matters incident to such transactions as such Purchaser may reasonably request.
Section 4.12. Purchase Permitted by Applicable Law, Etc. On the date of
Closing each purchase of Series 2000-A Notes shall (a) be permitted by the laws
and regulations of each jurisdiction to which each Purchaser is subject, without
recourse to provisions (such as Section 1405(a)(8) of the New York Insurance
Law) permitting limited investments by insurance companies without restriction
as to the character of the particular investment, (b) not violate any applicable
law or regulation (including, without limitation, Regulation T, U or X of the
Board of Governors of the Federal Reserve System) and (c) not subject any
Purchaser to any tax, penalty or liability under or pursuant to any applicable
law or regulation, which law or regulation was not in effect on the date hereof.
If requested by any Purchaser, such Purchaser shall have received an Officer's
Certificate certifying as to such matters of fact as such Purchaser may
reasonably specify to enable such Purchaser to determine whether such purchase
is so permitted.
Section 4.13. Related Transactions. The Company shall have consummated
the sale of the entire principal amount of the Series 2000-A Notes scheduled to
be sold on the date of Closing pursuant to this Agreement.
Section 4.14. Payment of Special Counsel Fees. Without limiting the
provisions of Section 15.1, the Company shall have paid on or before the
Closing, the reasonable fees, reasonable charges and reasonable disbursements of
the Purchasers' special counsel referred to in Section 4.11 to the extent
reflected in a statement of such counsel rendered to the Company at least one
Business Day prior to the Closing.
Section 4.15. Private Placement Number. A Private Placement Number
issued by Standard & Poor's CUSIP Service Bureau (in cooperation with the
Securities Valuation Office of
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the National Association of Insurance Commissioners) shall have been obtained
for each tranche of the Series 2000 Notes.
Section 4.16. Changes in Corporate Structure. The Company shall not
have changed its jurisdiction of incorporation or, except as reflected in
Schedule 4.16, been a party to any merger or consolidation and shall not have
succeeded to all or any substantial part of the liabilities of any other entity,
at any time following the date of the most recent financial statements referred
to in Schedule 5.5.
Section 4.17. Proceedings and Documents. All corporate and other
proceedings in connection with the transactions contemplated by this Agreement
and all documents and instruments incident to such transactions shall be
satisfactory to such Purchaser and such Purchaser's special counsel, and such
Purchaser and such Purchaser's special counsel shall have received all such
counterpart originals or certified or other copies of such documents as such
Purchaser or such Purchaser's special counsel may reasonably request.
Section 4.18. Conditions to Issuance of Additional Notes. The
obligations of the Additional Purchasers to purchase any Additional Notes shall
be subject to the following conditions precedent, in addition to the conditions
specified in the Supplement pursuant to which such Additional Notes may be
issued:
(a) Compliance Certificate. A duly authorized Senior Financial
Officer shall execute and deliver to each Additional Purchaser and each
holder of Notes an Officer's Certificate dated the date of issue of
such Series of Additional Notes stating that such officer has reviewed
the provisions of this Agreement (including any Supplements hereto) and
setting forth the information and computations (in sufficient detail)
required in order to establish whether the Company is in compliance
with the requirements of Section 10.2 on such date (based upon the
financial statements for the most recent fiscal quarter ended prior to
the date of such certificate).
(b) Execution and Delivery of Supplement. The Company and
each such Additional Purchaser shall execute and deliver a Supplement
substantially in the form of Exhibit S hereto.
(c) Representations of Additional Purchasers. Each Additional
Purchaser shall have confirmed in the Supplement that the
representations set forth in Section 6 are true with respect to such
Additional Purchaser on and as of the date of issue of the Additional
Notes.
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to each Purchaser that:
Section 5.1. Organization; Power and Authority. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of its jurisdiction of incorporation, and is duly qualified as a foreign
corporation and is in good standing in each
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jurisdiction in which such qualification is required by law, other than those
jurisdictions as to which the failure to be so qualified or in good standing
could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. The Company has the corporate power and authority to
own or hold under lease the properties it purports to own or hold under lease,
to transact the business it transacts and proposes to transact, to execute and
deliver this Agreement, the Security Documents and the Notes and to perform the
provisions hereof and thereof.
Section 5.2. Authorization, Etc. This Agreement, the Security Documents
and the Notes have been duly authorized by all necessary corporate action on the
part of the Company, and this Agreement and the Security Documents constitute,
and upon execution and delivery thereof each Note will constitute, a legal,
valid and binding obligation of the Company enforceable against the Company in
accordance with its terms, except as such enforceability may be limited by (i)
applicable bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or other similar laws affecting the enforcement of creditors' rights
generally and (ii) general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
Section 5.3. Disclosure. The Company, through its agents, Banc of
America Securities LLC and Morgan Stanley Dean Witter, has delivered to each
Purchaser a copy of a Private Placement Memorandum, dated January, 2000 (the
"Memorandum"), relating to the transactions contemplated hereby. The Memorandum
fairly describes, in all material respects, the general nature of the business
and principal properties of the Company and its Subsidiaries. Except for any
research reports (if any) prepared by Banc of America Securities LLC and Morgan
Stanley Dean Witter which may have been provided separately from the Memorandum
for which no representation or warranty is being made by the Company, this
Agreement, the Security Documents, the Memorandum, the documents, certificates
or other writings delivered to the Purchasers by or on behalf of the Company in
connection with the transactions contemplated hereby and the financial
statements listed in Schedule 5.5, taken as a whole, do not contain any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein not misleading in light of the circumstances under
which they were made. Since September 30, 1999, there has been no change in the
financial condition, operations, business or properties of the Company or any of
its Subsidiaries except changes that individually or in the aggregate could not
reasonably be expected to have a Material Adverse Effect. There is no fact known
to the Company that could reasonably be expected to have a Material Adverse
Effect that has not been set forth herein or in the Memorandum or in the other
documents, certificates and other writings delivered to each Purchaser by or on
behalf of the Company specifically for use in connection with the transactions
contemplated hereby.
Section 5.4. Organization and Ownership of Shares of Subsidiaries;
Affiliates. (a) Schedule 5.4 contains (except as noted therein) complete and
correct lists of (i) the Company's Subsidiaries, showing, as to each Subsidiary,
the correct name thereof, the jurisdiction of its organization, and the
percentage of shares of each class of its capital stock or similar equity
interests outstanding owned by the Company and each other Subsidiary, and all
other Investments of the Company and its Subsidiaries, and (ii) the Company's
directors and senior officers.
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(b) All of the outstanding shares of capital stock or similar equity
interests of each Subsidiary shown in Schedule 5.4 as being owned by the Company
and its Subsidiaries have been validly issued, are fully paid and nonassessable
and are owned by the Company or another Subsidiary free and clear of any Lien,
except for the Liens created by the Security Documents and as otherwise
disclosed in Schedule 5.4.
(c) Each Subsidiary identified in Schedule 5.4 is a corporation or
other legal entity duly organized, validly existing and in good standing under
the laws of its jurisdiction of organization, and is duly qualified as a foreign
corporation or other legal entity and is in good standing in each jurisdiction
in which such qualification is required by law, other than those jurisdictions
as to which the failure to be so qualified or in good standing could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. Each such Subsidiary has the corporate or other power and
authority to own or hold under lease the properties it purports to own or hold
under lease and to transact the business it transacts and proposes to transact.
(d) No Subsidiary is a party to, or otherwise subject to, any legal
restriction or any agreement (other than this Agreement, the agreements listed
on Schedule 5.4 and customary limitations imposed by corporate law statutes)
restricting the ability of such Subsidiary to pay dividends out of profits or
make any other similar distributions of profits to the Company or any of its
Subsidiaries that owns outstanding shares of capital stock or similar equity
interests of such Subsidiary.
Section 5.5. Financial Statements. The Company has delivered to each
Purchaser copies of the financial statements of the Company and its Subsidiaries
listed on Schedule 5.5. All of said financial statements (including in each case
the related schedules and notes) fairly present in all material respects the
consolidated financial position of the Company and its Subsidiaries as of the
respective dates specified in such financial statements and the consolidated
results of their operations and cash flows for the respective periods so
specified and have been prepared in accordance with GAAP consistently applied
throughout the periods involved except as set forth in the notes thereto
(subject, in the case of any interim financial statements, to normal year-end
adjustments).
Section 5.6. Compliance with Laws, Other Instruments, Etc. The
execution, delivery and performance by the Company of this Agreement, the
Security Documents and the Notes will not (a) contravene, result in any breach
of, or constitute a default under, or result in the creation of any Lien not
permitted by Section 10.5 in respect of any property of the Company or any
Subsidiary under, any indenture, mortgage, deed of trust, loan, purchase or
credit agreement, lease, corporate charter or by-laws, or any other agreement or
instrument to which the Company or any Subsidiary is bound or by which the
Company or any Subsidiary or any of their respective properties may be bound or
affected, (b) conflict with or result in a breach of any of the terms,
conditions or provisions of any order, judgment, decree, or ruling of any court,
arbitrator or Governmental Authority applicable to the Company or any
Subsidiary, or (c) violate any provision of any statute or other rule or
regulation of any Governmental Authority applicable to the Company or any
Subsidiary, except for any such default, breach, contravention or violation
which could not reasonably be expected to have a Material Adverse Effect.
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Section 5.7. Governmental Authorizations, Etc. No consent, approval or
authorization of, or registration, filing or declaration with, any Governmental
Authority is required in connection with the execution, delivery or performance
by the Company of this Agreement, the Security Documents or the Notes, except
for such filings as may be necessary to perfect or maintain the perfection of
the Liens created by the Security Documents, certain other customary filing
related to future performance and routine governmental filings made in
compliance with any applicable securities laws.
Section 5.8. Litigation; Observance of Statutes and Orders. (a) There
are no actions, suits or proceedings pending or, to the knowledge of the
Company, threatened against or affecting the Company or any Subsidiary or any
property of the Company or any Subsidiary in any court or before any arbitrator
or before or by any Governmental Authority that in any such case, individually
or in the aggregate, could reasonably be expected to have a Material Adverse
Effect.
(b) Neither the Company nor any Subsidiary is in default under any term
of any agreement or instrument to which it is a party or by which it is bound,
or any order, judgment, decree or ruling of any court, arbitrator or
Governmental Authority or is in violation of any applicable law, ordinance, rule
or regulation (including without limitation Environmental Laws) of any
Governmental Authority, which default or violation, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.
Section 5.9. Taxes. The Company and its Subsidiaries have filed all
Material tax returns that are required to have been filed in any jurisdiction,
and have paid all taxes shown to be due and payable on such returns and all
other taxes and assessments levied upon them or their properties, assets, income
or franchises, to the extent such taxes and assessments have become due and
payable and before they have become delinquent, except for any taxes and
assessments (a) the amount of which is not individually or in the aggregate
Material or (b) the amount, applicability or validity of which is currently
being contested in good faith by appropriate proceedings and with respect to
which the Company or a Subsidiary, as the case may be, has established adequate
reserves in accordance with GAAP. The Company knows of no basis for any other
tax or assessment that could reasonably be expected to have a Material Adverse
Effect. The charges, accruals and reserves on the books of the Company and its
Subsidiaries in respect of federal, state or other taxes for all fiscal periods
are adequate, as calculated in accordance with GAAP.
Section 5.10. Title to Property Leases. The Company and its
Subsidiaries have good and sufficient title to their respective properties which
the Company and its Subsidiaries own or purport to own, including all such
properties reflected in the most recent audited balance sheet referred to in
Section 5.5 or purported to have been acquired by the Company or any Subsidiary
after said date (except as sold or otherwise disposed of in the ordinary course
of business), in each case free and clear of Liens prohibited by this Agreement.
All leases that individually or in the aggregate are Material are valid and
subsisting and are in full force and effect in all material respects.
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Section 5.11. Licenses, Permits, Etc. Except as disclosed in Schedule
5.11,
(a) the Company and its Subsidiaries own or possess all
licenses, permits, franchises, authorizations, patents, copyrights,
service marks, trademarks and trade names, or rights thereto, that
individually or in the aggregate are Material, without known conflict
with the rights of others except for those conflicts, that,
individually or in the aggregate, would not have a Material Adverse
Effect;
(b) to the best knowledge of the Company, no product of the
Company or any of its Subsidiaries infringes in any material respect
any license, permit, franchise, authorization, patent, copyright,
service mark, trademark, trade name or other right owned by any other
Person; and
(c) to the best knowledge of the Company, there is no Material
violation by any Person of any right of the Company or any of its
Subsidiaries with respect to any patent, copyright, service mark,
trademark, trade name or other right owned or used by the Company or
any of its Subsidiaries.
Section 5.12. Compliance with ERISA. (a) The Company and each ERISA
Affiliate have operated and administered each Plan in compliance with all
applicable laws except for such instances of noncompliance as have not resulted
in and could not reasonably be expected to result in a Material Adverse Effect.
Neither the Company nor any ERISA Affiliate has incurred any liability pursuant
to Title I or IV of ERISA or the penalty or excise tax provisions of the Code
relating to employee benefit plans (as defined in Section 3 of ERISA), and no
event, transaction or condition has occurred or exists that could reasonably be
expected to result in the incurrence of any such liability by the Company or any
ERISA Affiliate, or in the imposition of any Lien on any of the rights,
properties or assets of the Company or any ERISA Affiliate, in either case
pursuant to Title I or IV of ERISA or to such penalty or excise tax provisions
or to Section 401(a)(29) or 412 of the Code, other than such liabilities or
Liens as would not be individually or in the aggregate Material.
(b) The present value of the aggregate benefit liabilities under each
of the Plans (other than Multiemployer Plans), determined as of the end of such
Plan's most recently ended plan year on the basis of the actuarial assumptions
specified for funding purposes in such Plan's most recent actuarial valuation
report, did not exceed the aggregate current value of the assets of such Plan
allocable to such benefit liabilities. The term "benefit liabilities" has the
meaning specified in Section 4001 of ERISA and the terms "current value" and
"present value" have the meanings specified in Section 3 of ERISA.
(c) The Company and its ERISA Affiliates have not incurred withdrawal
liabilities (and are not subject to contingent withdrawal liabilities) under
Section 4201 or 4204 of ERISA in respect of Multiemployer Plans that
individually or in the aggregate are Material.
(d) The expected post-retirement benefit obligation (determined as of
the last day of the Company's most recently ended fiscal year in accordance with
Financial Accounting Standards Board Statement No. 106, without regard to
liabilities attributable to continuation coverage
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mandated by Section 4980B of the Code), if any, of the Company and its
Subsidiaries under any employee welfare benefit plan (as defined in Section 3 of
ERISA), is not Material or has otherwise been disclosed in the most recent
audited consolidated financial statements of the Company and its Subsidiaries.
(e) The execution and delivery of this Agreement and the Security
Documents and the issuance and sale of the Notes hereunder will not involve any
transaction that is subject to the prohibitions of Section 406 of ERISA or in
connection with which a tax could be imposed pursuant to Section
4975(c)(1)(A)-(D) of the Code which in either event, could reasonably be
expected to result in a Material Adverse Effect. The representation by the
Company in the first sentence of this Section 5.12(e) is made in reliance upon
and subject to the accuracy of each Purchaser's representation in Section 6.2 as
to the sources of the funds to be used to pay the purchase price of the Notes to
be purchased by such Purchaser.
Section 5.13. Private Offering by the Company. Neither the Company nor
anyone acting on its behalf has offered the Series 2000-A Notes or any similar
securities for sale to, or solicited any offer to buy any of the same from, or
otherwise approached or negotiated in respect thereof with, any Person other
than the Purchasers and not more than 65 other Institutional Investors, each of
which has been offered the Series 2000-A Notes in connection with a private
placement for investment. Neither the Company nor anyone acting on its behalf
has taken, or will take, any action that would subject the issuance or sale of
the Series 2000-A Notes to the registration requirements of Section 5 of the
Securities Act.
Section 5.14. Use of Proceeds; Margin Regulations. The Company will
apply the proceeds of the sale of the Series 2000-A Notes for general corporate
purposes of the Company and its Subsidiaries (including the repayment of Debt of
the Company and its Subsidiaries and for acquisitions). No part of the proceeds
from the sale of the Series 2000-A Notes hereunder will be used, directly or
indirectly, for the purpose of buying or carrying any margin stock within the
meaning of Regulation U of the Board of Governors of the Federal Reserve System
(12 CFR 221), or for the purpose of buying or carrying or trading in any
securities under such circumstances as to involve the Company in a violation of
Regulation X of said Board (12 CFR 224) or to involve any broker or dealer in a
violation of Regulation T of said Board (12 CFR 220). Margin stock does not
constitute more than 2% of the value of the consolidated assets of the Company
and its Subsidiaries and the Company does not have any present intention that
margin stock will constitute more than 2% of the value of such assets. As used
in this Section, the terms "margin stock" and "purpose of buying or carrying"
shall have the meanings assigned to them in said Regulation U.
Section 5.15. Existing Debt; Future Liens. (a) Except as described
therein, Schedule 5.15 sets forth a complete and correct list of all outstanding
Debt of the Company and its Subsidiaries as of December 31, 1999, since which
date there has been no Material change in the amounts, interest rates, sinking
funds, installment payments or maturities of the Debt of the Company or its
Subsidiaries. Neither the Company nor any Subsidiary is in default and no waiver
of default is currently in effect, in the payment of any principal or interest
on any Debt of the Company or such Subsidiary in an unpaid amount of $1,000,000
or more and no event or condition exists with respect to any Debt of the Company
or any Subsidiary in an unpaid amount of $1,000,000 or
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more that would permit (or that with notice or the lapse of time, or both, would
permit) one or more Persons to cause such Debt to become due and payable before
its stated maturity or before its regularly scheduled dates of payment.
(b) Except as disclosed in Schedule 5.15, neither the Company nor any
Subsidiary has agreed or consented to cause or permit in the future (upon the
happening of a contingency or otherwise) any of its property, whether now owned
or hereafter acquired, to be subject to a Lien not permitted by Section 10.5.
Section 5.16. Foreign Assets Control Regulations, Etc. Neither the sale
of the Notes by the Company hereunder nor its use of the proceeds thereof will
violate the Trading with the Enemy Act, as amended, or any of the foreign assets
control regulations of the United States Treasury Department (31 CFR, Subtitle
B, Chapter V, as amended) or any enabling legislation or executive order
relating thereto.
Section 5.17. Status under Certain Statutes. Neither the Company nor
any Subsidiary is an "investment company" registered or required to be
registered under the Investment Company Act of 1940, as amended, or is subject
to regulation under the Public Utility Holding Company Act of 1935, as amended,
the ICC Termination Act of 1995, as amended, or the Federal Power Act, as
amended.
Section 5.18. Environmental Matters. Neither the Company nor any
Subsidiary has knowledge of any liability or has received any notice of any
liability, and no proceeding has been instituted against the Company or any of
its Subsidiaries or any of their respective real properties now or formerly
owned, leased or operated by any of them, alleging any violation of any
Environmental Laws, except, in each case, such as could not reasonably be
expected to result in a Material Adverse Effect. Except as otherwise disclosed
to each Purchaser in writing:
(a) neither the Company nor any Subsidiary has knowledge of
any facts which would give rise to any liability, public or private,
for violation of Environmental Laws or damage to the environment
emanating from, occurring on or in any way related to real properties
or to other assets now or formerly owned, leased or operated by any of
them or their use, except, in each case, such as could not reasonably
be expected to result in a Material Adverse Effect;
(b) neither the Company nor any of its Subsidiaries has stored
any Hazardous Materials on real properties now or formerly owned,
leased or operated by any of them or has disposed of any Hazardous
Materials in each case in a manner contrary to any Environmental Laws
and in any manner that could reasonably be expected to result in a
Material Adverse Effect; and
(c) to the knowledge of the Company and its Subsidiaries, all
buildings on all real properties now owned, leased or operated by the
Company or any of its Subsidiaries are in compliance with applicable
Environmental Laws, except where failure to comply could not reasonably
be expected to result in a Material Adverse Effect.
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Section 5.19. Filing and Recordation. On the date of Closing, all UCC
financing statements and all Security Documents have been duly filed in all
public offices wherein such filings were made to perfect the Lien of the
security agreement securing the Debt outstanding under the Bank Credit
Agreement. The Security Documents create a valid Lien in the collateral
described therein.
Section 5.20. Other Representations and Warranties. The representations
and warranties of the Company set forth in the Security Documents are true and
correct as of the date of Closing and are incorporated herein by reference with
the same force and effect as though set forth herein in full.
SECTION 6. REPRESENTATIONS OF THE PURCHASER.
Section 6.1. Purchase for Investment. Each Purchaser represents that it
is purchasing the Series 2000-A Notes for its own account or for one or more
separate accounts maintained by it or for the account of one or more pension or
trust funds and not with a view to the distribution thereof, provided that the
disposition of such Purchaser's or such pension or trust funds' property shall
at all times be within such Purchaser's or such pension or trust funds' control.
Each Purchaser understands that the Series 2000-A Notes have not been registered
under the Securities Act and may be resold only if registered pursuant to the
provisions of the Securities Act or if an exemption from registration is
available, except under circumstances where neither such registration nor such
an exemption is required by law, and that the Company is not required to
register the Series 2000-A Notes.
Section 6.2. Source of Funds. Each Purchaser represents that at least
one of the following statements is an accurate representation as to each source
of funds (a "Source") to be used by it to pay the purchase price of the Series
2000-A Notes to be purchased by it hereunder:
(a) the Source is an "insurance company general account"
within the meaning of Department of Labor Prohibited Transaction
Exemption ("PTE") 95-60 (issued July 12, 1995) and there is no employee
benefit plan, treating as a single plan all plans maintained by the
same employer or employee organization, with respect to which the
amount of the general account reserves and liabilities for all
contracts held by or on behalf of such plan, exceeds ten percent (10%)
of the total reserves and liabilities of such general account
(exclusive of separate account liabilities) plus surplus, as set forth
in the NAIC Annual Statement for such Purchaser most recently filed
with such Purchaser's state of domicile; or
(b) the Source is either (i) an insurance company pooled
separate account, within the meaning of PTE 90-1 (issued January 29,
1990), or (ii) a bank collective investment fund, within the meaning of
the PTE 91-38 (issued July 12, 1991) and, except as such Purchaser
prior to the execution and delivery of this Agreement has disclosed to
the Company in writing pursuant to this paragraph (b), no employee
benefit plan or group of plans maintained by the same employer or
employee organization beneficially owns more than 10% of all assets
allocated to such pooled separate account or collective investment
fund; or
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(c) the Source constitutes assets of an "investment fund"
(within the meaning of Part V of the QPAM Exemption) managed by a
"qualified professional asset manager" or "QPAM" (within the meaning of
Part V of the QPAM Exemption), no employee benefit plan's assets that
are included in such investment fund, when combined with the assets of
all other employee benefit plans established or maintained by the same
employer or by an affiliate (within the meaning of Section V(c)(1) of
the QPAM Exemption) of such employer or by the same employee
organization and managed by such QPAM, exceed 20% of the total client
assets managed by such QPAM, the conditions of Part I(c) and (g) of the
QPAM Exemption are satisfied, neither the QPAM nor a person controlling
or controlled by the QPAM (applying the definition of "control" in
Section V(e) of the QPAM Exemption) owns a 5% or more interest in the
Company and (i) the identity of such QPAM and (ii) the names of all
employee benefit plans whose assets are included in such investment
fund have been disclosed to the Company in writing pursuant to this
paragraph (c) prior to the execution and delivery of this Agreement; or
(d) the Source is a governmental plan; or
(e) the Source is one or more employee benefit plans, or a
separate account or trust fund comprised of one or more employee
benefit plans, each of which prior to the execution and delivery of
this Agreement has been identified to the Company in writing pursuant
to this paragraph (e); or
(f) the Source does not include assets of any employee benefit
plan, other than a plan exempt from the coverage of ERISA; or
(g) the Source is an insurance company separate account
maintained solely in connection with the fixed contractual obligations
of the insurance company under which the amounts payable, or credited,
to any employee benefit plan (or its related trust) and to any
participant or beneficiary of such plan (including any annuitant) are
not affected in any manner by the investment performance of the
separate account.
If any Purchaser or any Additional Purchaser or any subsequent transferee of the
Notes indicates that such Purchaser or any Additional Purchaser or such
transferee is relying on any representation contained in paragraph (b), (c) or
(e) above, the Company shall deliver on the date of issuance of such Notes and
on the date of any applicable transfer a certificate, which shall either state
that (i) it is neither a party in interest nor a "disqualified person" (as
defined in Section 4975(e)(2) of the Code), with respect to any plan identified
pursuant to paragraphs (b) or (e) above, or (ii) with respect to any plan,
identified pursuant to paragraph (c) above, neither it nor any "affiliate" (as
defined in Section V(c) of the QPAM Exemption) has at such time, and during the
immediately preceding one year, exercised the authority to appoint or terminate
said QPAM as manager of any plan identified in writing pursuant to paragraph (c)
above or to negotiate the terms of said QPAM's management agreement on behalf of
any such identified plan. As used in this Section 6.2, the terms "employee
benefit plan", "governmental plan", "party in interest" and "separate account"
shall have the respective meanings assigned to such terms in Section 3 of ERISA.
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Section 6.3. Disclosure of Information. Each Purchaser has received all
the information it considers necessary or appropriate for deciding whether to
purchase the Series 2000-A Notes. Each Purchaser further represents that it has
had an opportunity to ask questions and receive answers from the Company
regarding the terms and conditions of the offering of the Series 2000-A Notes
and the business, properties, prospects and financial condition of the Company.
The foregoing, however, does not limit or modify the representations and
warranties of the Company in Section 5 of this Agreement or the rights of the
Purchasers to rely thereon.
Section 6.4. Investment Experience. Each Purchaser acknowledges that it
is able to fend for itself, can bear the risk of its investment, and has such
knowledge and experience in financial or business matters that it is capable of
evaluating the merits and risks of the investment in the Series 2000-A Notes.
Section 6.5. Accredited Investor. Each Purchaser represents that it is
an "accredited investor" within the meaning of the Securities and Exchange
Commission Rule 501 of Regulation D, as presently in effect.
SECTION 7. INFORMATION AS TO COMPANY.
Section 7.1. Financial and Business Information. The Company shall
deliver to each holder of Notes that is an Institutional Investor (other than a
Competitor of the Company or any Subsidiary so long as no Event of Default shall
have occurred and be continuing):
(a) Quarterly Statements -- within 60 days after the end of
each quarterly fiscal period in each fiscal year of the Company (other
than the last quarterly fiscal period of each such fiscal year),
duplicate copies of,
(i) a consolidated balance sheet of the Company and
its Subsidiaries as at the end of such quarter, and
(ii) consolidated statements of income, changes in
shareholders' equity and cash flows of the Company and its
Subsidiaries, for such quarter and (in the case of the second
and third quarters) for the portion of the fiscal year ending
with such quarter,
setting forth in each case in comparative form the figures for the
corresponding periods in the previous fiscal year, all in reasonable
detail, prepared in accordance with GAAP applicable to quarterly
financial statements generally, and certified by a Senior Financial
Officer as fairly presenting, in all material respects, the financial
position of the companies being reported on and their results of
operations and cash flows, subject to changes resulting from normal,
recurring year-end adjustments, provided that delivery within the time
period specified above of copies of the Company's Quarterly Report on
Form 10-Q prepared in compliance with the requirements therefor and
filed with the Securities and Exchange Commission shall be deemed to
satisfy the requirements of this Section 7.1(a);
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(b) Annual Statements -- within 120 days after the end of each
fiscal year of the Company, duplicate copies of,
(i) a consolidated balance sheet of the Company and
its Subsidiaries, as at the end of such year, and
(ii) consolidated statements of income, changes in
shareholders' equity and cash flows of the Company and its
Subsidiaries, for such year,
setting forth in each case in comparative form the figures for the
previous fiscal year, all in reasonable detail, prepared in accordance
with GAAP, and accompanied by an opinion thereon of independent
certified public accountants of recognized national standing, which
opinion shall state that such financial statements present fairly, in
all material respects, the financial position of the companies being
reported upon and their results of operations and cash flows and have
been prepared in conformity with GAAP, and that the examination of such
accountants in connection with such financial statements has been made
in accordance with generally accepted auditing standards, and that such
audit provides a reasonable basis for such opinion in the
circumstances, provided that the delivery within the time period
specified above of the Company's Annual Report on Form 10-K for such
fiscal year (together with the Company's annual report to shareholders,
if any, prepared pursuant to Rule 14a-3 under the Exchange Act)
prepared in accordance with the requirements therefor and filed with
the Securities and Exchange Commission shall be deemed to satisfy the
requirements of this Section 7.1(b);
(c) SEC and Other Reports -- promptly upon their becoming
available, one copy of (i) each financial statement, report, notice or
proxy statement sent by the Company or any Subsidiary to public
securities holders generally, and (ii) each regular or periodic report,
each registration statement (without exhibits except as expressly
requested by such holder), and each prospectus and all amendments
thereto filed by the Company or any Subsidiary with the Securities and
Exchange Commission containing information of a financial nature and of
all press releases and other statements made available generally by the
Company or any Subsidiary to the public concerning developments that
are Material;
(d) Notice of Default or Event of Default -- promptly, and in
any event within ten Business Days after a Responsible Officer becomes
aware of the existence of any Default or Event of Default or that any
Person has given any notice or taken any action with respect to a
claimed default hereunder or that any Person has given any notice or
taken any action with respect to a claimed default of the type referred
to in Section 11(h), a written notice specifying the nature and period
of existence thereof and what action the Company is taking or proposes
to take with respect thereto;
(e) ERISA Matters -- promptly, and in any event within ten
Business Days after a Responsible Officer becomes aware of any of the
following, a written notice setting forth the nature thereof and the
action, if any, that the Company or an ERISA Affiliate proposes to take
with respect thereto:
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(i) with respect to any Plan, any reportable event,
as defined in Section 4043(b) of ERISA and the regulations
thereunder, for which notice thereof has not been waived
pursuant to such regulations as in effect on the date thereof;
or
(ii) the taking by the PBGC of steps to institute, or
the threatening by the PBGC of the institution of, proceedings
under Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Plan, or the
receipt by the Company or any ERISA Affiliate of a notice from
a Multiemployer Plan that such action has been taken by the
PBGC with respect to such Multiemployer Plan; or
(iii) the incurrence of any liability by the Company
or any ERISA Affiliate pursuant to Title I or IV of ERISA or
the imposition of a penalty or excise tax under the provisions
of the Code relating to employee benefit plans, or the
imposition of any Lien on any of the rights, properties or
assets of the Company or any ERISA Affiliate pursuant to Title
I or IV of ERISA or such penalty or excise tax provisions, if
such liability or Lien, taken together with any other such
liabilities or Liens then existing, could reasonably be
expected to have a Material Adverse Effect;
(f) Notices from Governmental Authority -- promptly, and in
any event within 30 days of receipt thereof, copies of any notice to
the Company or any Subsidiary from any federal or state Governmental
Authority relating to any order, ruling, statute or other law or
regulation that could reasonably be expected to have a Material Adverse
Effect;
(g) Supplements -- promptly and in any event within 10
Business Days after the execution and delivery of any Supplement, a
copy thereof;
(h) Bank Credit Agreement --- so long as any Event of Default
shall exist under the Bank Credit Agreement, the Company shall furnish
copies of any written notices or certificates furnished by the Company
or any Subsidiary to the Bank Lenders not more than 5 Business Days
following delivery to the Bank Lenders; and
(i) Requested Information -- with reasonable promptness, such
other data and information relating to the business, operations,
affairs, financial condition, assets or properties of the Company or
any of its Subsidiaries or relating to the ability of the Company to
perform its obligations hereunder and under the Notes as from time to
time may be reasonably requested by any such holder of Notes.
Section 7.2. Officer's Certificate. Each set of financial statements
delivered to a holder of Notes pursuant to Section 7.1(a) or Section 7.1(b)
hereof shall be accompanied by a certificate of a Senior Financial Officer
setting forth:
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(a) Covenant Compliance -- the information (including detailed
calculations) required in order to establish whether the Company was in
compliance with the requirements of Section 10.1 through Section 10.4,
Section 10.5(l) and Section 10.7 hereof, inclusive, during the
quarterly or annual period covered by the statements then being
furnished (including with respect to each such Section, where
applicable, the calculations of the maximum or minimum amount, ratio or
percentage, as the case may be, permissible under the terms of such
Sections, and the calculation of the amount, ratio or percentage then
in existence, including, without limitation, a reasonably detailed
calculation of Consolidated Proforma Operating Cash Flow for such
period); and
(b) Event of Default -- a statement that such officer has
reviewed the relevant terms hereof and has made, or caused to be made,
under his or her supervision, a review of the transactions and
conditions of the Company and its Subsidiaries from the beginning of
the quarterly or annual period covered by the statements then being
furnished to the date of the certificate and that such review shall not
have disclosed the existence during such period of any condition or
event that constitutes a Default or an Event of Default or, if any such
condition or event existed or exists (including, without limitation,
any such event or condition resulting from the failure of the Company
or any Subsidiary to comply with any Environmental Law), specifying the
nature and period of existence thereof and what action the Company
shall have taken or proposes to take with respect thereto.
Section 7.3. Inspection. The Company shall permit the representatives
of each holder of Notes that is an Institutional Investor (other than a
Competitor of the Company or any Subsidiary so long as no Event of Default shall
have occurred and be continuing):
(a) No Default -- if no Default or Event of Default then
exists, at the expense of such holder and upon reasonable prior notice
to the Company, to visit the principal executive office of the Company,
to discuss the affairs, finances and accounts of the Company and its
Subsidiaries with the Company's officers, and (with the consent of the
Company, which consent will not be unreasonably withheld) its
independent public accountants, and (with the consent of the Company,
which consent will not be unreasonably withheld) to visit the other
offices and properties of the Company and each Subsidiary, all at such
reasonable times during business hours and as often as may be
reasonably requested in writing; and
(b) Default -- if a Default or Event of Default then exists,
at the expense of the Company and upon reasonable prior notice, to
visit and inspect any of the offices or properties of the Company or
any Subsidiary, to examine all their respective books of account,
records, reports and other papers, to make copies and extracts
therefrom, and to discuss their respective affairs, finances and
accounts with their respective officers and independent public
accountants (and by this provision the Company authorizes said
accountants to discuss the affairs, finances and accounts of the
Company and its Subsidiaries), all at such reasonable times during
business hours and as often as may be reasonably requested.
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SECTION 8. PREPAYMENT OF THE NOTES.
Section 8.1. Required Prepayments. (a) The entire principal amount of
the Tranche 1 Notes shall become due and payable on March 1, 2005.
(b) The entire principal amount of the Tranche 2 Notes shall become due
and payable on March 1, 2007.
(c) The entire principal amount of the Tranche 3 Notes shall become due
and payable on March 1, 2010.
Section 8.2. Optional Prepayments with Make-Whole Amount. The Company
may, at its option, upon notice as provided below, prepay at any time all, or
from time to time any part of, the Notes of any Series, in an amount not less
than 10% of the aggregate principal amount of the Notes of such Series then
outstanding in the case of a partial prepayment, at 100% of the principal amount
so prepaid, together with interest accrued thereon to the date of such
prepayment, plus the Make-Whole Amount determined for the prepayment date with
respect to such principal amount of each Note of the applicable Series then
outstanding. The Company will give each holder of Notes of the Series to be
prepaid written notice of each optional prepayment under this Section 8.2 not
less than 30 days and not more than 60 days prior to the date fixed for such
prepayment. Each such notice shall specify such date, the aggregate principal
amount of the Notes and each Series of Notes to be prepaid on such date, the
principal amount of each Note held by such holder to be prepaid (determined in
accordance with Section 8.3), and the interest to be paid on the prepayment date
with respect to such principal amount being prepaid, and shall be accompanied by
a certificate of a Senior Financial Officer as to the estimated Make-Whole
Amount due in connection with such prepayment (calculated as if the date of such
notice were the date of the prepayment), setting forth the details of such
computation. Two Business Days prior to such prepayment, the Company shall
deliver to each holder of Notes of the Series to be prepaid a certificate of a
Senior Financial Officer specifying the calculation of such Make-Whole Amount as
of the specified prepayment date.
Section 8.3. Allocation of Partial Prepayments. In the case of each
partial prepayment of the Notes pursuant to the provisions of Section 8.2, the
principal amount of the Notes of the Series to be prepaid shall be allocated
among all of the Notes of such Series at the time outstanding in proportion, as
nearly as practicable, to the respective unpaid principal amounts thereof. All
regularly scheduled partial prepayments made with respect to any Additional
Series of Notes pursuant to any Supplement shall be allocated as provided
therein.
Section 8.4. Maturity; Surrender, Etc. In the case of each prepayment
of Notes pursuant to this Section 8, the principal amount of each Note to be
prepaid shall mature and become due and payable on the date fixed for such
prepayment, together with interest on such principal amount accrued to such date
and the applicable Make-Whole Amount, if any. From and after such date, unless
the Company shall fail to pay such principal amount when so due and payable,
together with the interest and Make-Whole Amount, if any, as aforesaid, interest
on such principal amount shall cease to accrue. Any Note paid or prepaid in full
shall be surrendered to
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the Company and cancelled and shall not be reissued, and no Note shall be issued
in lieu of any prepaid principal amount of any Note.
Section 8.5. Purchase of Notes. The Company will not and will use
reasonable commercial efforts to not permit any Affiliate to purchase, redeem,
prepay or otherwise acquire, directly or indirectly, any of the outstanding
Notes except upon the payment or prepayment of the Notes in accordance with the
terms of this Agreement (including any Supplement hereto) and the Notes. The
Company will promptly cancel all Notes acquired by it or any Subsidiary pursuant
to any payment, prepayment or purchase of Notes pursuant to any provision of
this Agreement and no Notes may be issued in substitution or exchange for any
such Notes.
Section 8.6. Make-Whole Amount for Series 2000-A Notes. The term
"Make-Whole Amount" means, with respect to a Series 2000-A Note of any Tranche,
an amount equal to the excess, if any, of the Discounted Value of the Remaining
Scheduled Payments with respect to the Called Principal of the Series 2000-A
Note of such Tranche over the amount of such Called Principal, provided that the
Make-Whole Amount may in no event be less than zero. For the purposes of
determining the Make-Whole Amount, the following terms have the following
meanings:
"Called Principal" means, with respect to a Series 2000-A Note
of any Tranche, the principal of the Series 2000-A Note of such Tranche
that is to be prepaid pursuant to Section 8.2 or has become or is
declared to be immediately due and payable pursuant to Section 12.1, as
the context requires.
"Discounted Value" means, with respect to the Called Principal
of a Series 2000-A Note of any Tranche, the amount obtained by
discounting all Remaining Scheduled Payments with respect to such
Called Principal from their respective scheduled due dates to the
Settlement Date with respect to such Called Principal, in accordance
with accepted financial practice and at a discount factor (applied on
the same periodic basis as that on which interest on the Series 2000-A
Note of such Tranche is payable) equal to the Reinvestment Yield with
respect to such Called Principal.
"Reinvestment Yield" means, with respect to the Called
Principal of a Series 2000-A Note of any Tranche, 0.50% plus the yield
to maturity implied by (i) the yields reported, as of 10:00 A.M. (New
York City time) on the second Business Day preceding the Settlement
Date with respect to such Called Principal, on the display designated
as "PX-1" on the Bloomberg Financial Market Screen (or such other
display as may replace "PX-1" on the Bloomberg Financial Market Screen)
for actively traded U.S. Treasury securities having a maturity equal to
the Remaining Average Life of such Called Principal as of such
Settlement Date, or (ii) if such yields are not reported as of such
time or the yields reported as of such time are not ascertainable, the
Treasury Constant Maturity Series Yields reported, for the latest day
for which such yields have been so reported as of the second Business
Day preceding the Settlement Date with respect to such Called
Principal, in Federal Reserve Statistical Release H.15 (519) (or any
comparable successor publication) for actively traded U.S. Treasury
securities having a constant maturity equal to the Remaining Average
Life of such Called Principal as of
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such Settlement Date. Such implied yield will be determined, if
necessary, by (a) converting U.S. Treasury bill quotations to
bond-equivalent yields in accordance with accepted financial practice
and (b) interpolating linearly on a straight line basis between (1) the
actively traded U.S. Treasury security with the maturity closest to and
greater than the Remaining Average Life and (2) the actively traded
U.S. Treasury security with the maturity closest to and less than the
Remaining Average Life.
"Remaining Average Life" means, with respect to any Called
Principal, the number of years (calculated to the nearest one-twelfth
year) obtained by dividing (i) such Called Principal into (ii) the sum
of the products obtained by multiplying (a) the principal component of
each Remaining Scheduled Payment with respect to such Called Principal
by (b) the number of years (calculated to the nearest one-twelfth year)
that will elapse between the Settlement Date with respect to such
Called Principal and the scheduled due date of such Remaining Scheduled
Payment.
"Remaining Scheduled Payments" means, with respect to the
Called Principal of a Series 2000-A Note of any Tranche, all payments
of such Called Principal and interest thereon that would be due after
the Settlement Date with respect to such Called Principal if no payment
of such Called Principal were made prior to its scheduled due date,
provided that if such Settlement Date is not a date on which interest
payments are due to be made under the terms of the Series 2000-A Note
of such Tranche, then the amount of the next succeeding scheduled
interest payment will be reduced by the amount of interest accrued to
such Settlement Date and required to be paid on such Settlement Date
pursuant to Section 8.2 or 12.1.
"Settlement Date" means, with respect to the Called Principal
of a Series 2000-A Note of any Tranche, the date on which such Called
Principal is to be prepaid pursuant to Section 8.2 or has become or is
declared to be immediately due and payable pursuant to Section 12.1, as
the context requires.
Section 8.7. Change in Control.
(a) Notice of Change in Control or Control Event. The Company will,
within fifteen Business Days after any Responsible Officer has knowledge of the
occurrence of any Change in Control or Control Event (subject in the case of any
Control Event to contractual limitations on disclosure and disclosure
limitations imposed by applicable securities laws), give written notice of such
Change in Control or Control Event to each holder of Notes unless notice in
respect of such Change in Control (or the Change in Control contemplated by such
Control Event) shall have been given pursuant to subparagraph (b) of this
Section 8.7. If a Change in Control has occurred, such notice shall contain and
constitute an offer to prepay Notes as described in subparagraph (c) of this
Section 8.7 and shall be accompanied by the certificate described in
subparagraph (g) of this Section 8.7.
(b) Condition to Company Action. The Company will not take any action
that consummates or finalizes a Change in Control unless (i) to the extent the
giving of such advance notice is reasonably within its control, at least 30 days
prior to such action it shall have given to
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each holder of Notes written notice containing and constituting an offer to
prepay Notes as described in subparagraph (c) of this Section 8.7, accompanied
by the certificate described in subparagraph (g) of this Section 8.7, and (ii)
contemporaneously with such action, it prepays all Notes required to be prepaid
in accordance with this Section 8.7.
(c) Offer to Prepay Notes. The offer to prepay Notes contemplated by
subparagraphs (a) and (b) of this Section 8.7 shall be an offer to prepay, in
accordance with and subject to this Section 8.7, all, but not less than all, the
Notes held by each holder (in this case only, "holder" in respect of any Note
registered in the name of a nominee for a disclosed beneficial owner shall mean
such beneficial owner) on a date specified in such offer (the "Proposed
Prepayment Date"). If such Proposed Prepayment Date is in connection with an
offer contemplated by subparagraph (a) of this Section 8.7, such date shall be
not less than 30 days and not more than 60 days after the date of such offer (if
the Proposed Prepayment Date shall not be specified in such offer, the Proposed
Prepayment Date shall be the 30th day after the date of such offer).
(d) Acceptance. A holder of Notes may accept the offer to prepay made
pursuant to this Section 8.7 by causing a notice of such acceptance to be
delivered to the Company at least 15 days prior to the Proposed Prepayment Date.
A failure by a holder of Notes to respond to an offer to prepay made pursuant to
this Section 8.7 shall be deemed to constitute a rejection of such offer by such
holder.
(e) Prepayment. Prepayment of the Notes to be prepaid pursuant to this
Section 8.7 shall be at 100% of the principal amount of such Notes together with
interest on such Notes accrued to the date of prepayment. The prepayment shall
be made on the Proposed Prepayment Date except as provided in subparagraph (f)
of this Section 8.7.
(f) Deferral Pending Change in Control. The obligation of the Company
to prepay Notes pursuant to the offers required by subparagraph (b) and accepted
in accordance with subparagraph (d) of this Section 8.7 is subject to the
occurrence of the Change in Control in respect of which such offers and
acceptances shall have been made. In the event that such Change in Control does
not occur on the Proposed Prepayment Date in respect thereof, the prepayment
shall be deferred until, and shall be made on the date on which, such Change in
Control occurs. The Company shall keep each holder of Notes reasonably and
timely informed of (i) any such deferral of the date of prepayment, (ii) the
date on which such Change in Control and the prepayment are expected to occur,
and (iii) any determination by the Company that efforts to effect such Change in
Control have ceased or been abandoned (in which case the offers and acceptances
made pursuant to this Section 8.7 in respect of such Change in Control shall be
deemed rescinded).
(g) Officer's Certificate. Each offer to prepay the Notes pursuant to
this Section 8.7 shall be accompanied by a certificate, executed by a Senior
Financial Officer of the Company and dated the date of such offer, specifying:
(i) the Proposed Prepayment Date; (ii) that such offer is made pursuant to this
Section 8.7; (iii) the principal amount of each Note offered to be prepaid; (iv)
the interest that would be due on each Note offered to be prepaid, accrued to
the Proposed
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Prepayment Date; (v) that the conditions of this Section 8.7 have been
fulfilled; and (vi) in reasonable detail, the nature and date or proposed date
of the Change in Control.
(h) "Change in Control" Defined. "Change in Control" means each and
every issue, sale or other disposition of shares of stock of the Company which
results in any person (as such term is used in Section 13(d) and Section
14(d)(2) of the Exchange Act) or related persons constituting a group (as such
term is used in Rule 13d-5 under the Exchange Act) (herein, an "Acquiring
Person") becoming the "beneficial owners" (as such term is used in Rule 13d-3
under the Exchange Act as in effect on the date of the Closing), directly or
indirectly, of more than 50% (by total voting power) of the issued and
outstanding capital stock of the Company which is entitled to vote in the
election of the members of the Company's board of directors.
(i) "Control Event" Defined. "Control Event" means:
(i) the execution by the Company or any of its Subsidiaries or
Affiliates of any agreement or letter of intent with respect to any
proposed transaction or event or series of transactions or events
which, individually or in the aggregate, may reasonably be expected to
result in a Change in Control,
(ii) the execution of any written agreement which, when fully
performed by the parties thereto, would result in a Change in Control,
or
(iii) at any time after a public offering of equity securities
of the Company, the making of any written offer by any Acquiring Person
to the holders of the common stock of the Company, which offer, if
accepted by the requisite number of holders, would result in a Change
in Control.
SECTION 9. AFFIRMATIVE COVENANTS.
The Company covenants that so long as any of the Notes are outstanding:
Section 9.1. Compliance with Law. The Company will, and will cause each
of its Subsidiaries to, comply with all laws, ordinances or governmental rules
or regulations to which each of them is subject, including, without limitation,
Environmental Laws, and will obtain and maintain in effect all licenses,
certificates, permits, franchises and other governmental authorizations
necessary to the ownership of their respective properties or to the conduct of
their respective businesses, in each case to the extent necessary to ensure that
non-compliance with such laws, ordinances or governmental rules or regulations
or failures to obtain or maintain in effect such licenses, certificates,
permits, franchises and other governmental authorizations could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
Section 9.2. Insurance. The Company will, and will cause each of its
Subsidiaries to, maintain, with financially sound and reputable insurers,
insurance with respect to their respective properties and businesses against
such casualties and contingencies, of such types, on such terms and in such
amounts (including deductibles, co-insurance and self-insurance, if adequate
reserves
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are maintained with respect thereto) as is customary in the case of entities of
established reputations engaged in the same or a similar business and similarly
situated.
Section 9.3. Maintenance of Properties. The Company will, and will
cause each of its Subsidiaries to, maintain and keep, or cause to be maintained
and kept, their respective properties in good repair, working order and
condition (other than ordinary wear and tear), so that the business carried on
in connection therewith may be properly conducted at all times, provided that
this Section shall not prevent the Company or any Subsidiary from discontinuing
the operation and the maintenance of any of its properties if such
discontinuance is desirable in the conduct of its business and the Company has
concluded that such discontinuance could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
Section 9.4. Payment of Taxes and Claims. The Company will, and will
cause each of its Subsidiaries to, file all tax returns required to be filed in
any jurisdiction and to pay and discharge all taxes shown to be due and payable
on such returns and all other taxes, assessments, governmental charges, or
levies imposed on them or any of their properties, assets, income or franchises,
to the extent such taxes and assessments have become due and payable and before
they have become delinquent and all claims for which sums have become due and
payable that have or might become a Lien on properties or assets of the Company
or any Subsidiary not permitted by Section 10.4, provided that neither the
Company nor any Subsidiary need pay any such tax or assessment or claims if (i)
the amount, applicability or validity thereof is contested by the Company or
such Subsidiary on a timely basis in good faith and in appropriate proceedings,
and the Company or a Subsidiary has established adequate reserves therefor in
accordance with GAAP on the books of the Company or such Subsidiary or (ii) the
non-filing or nonpayment, as the case may be, of all such taxes and assessments
in the aggregate could not reasonably be expected to have a Material Adverse
Effect.
Section 9.5. Corporate Existence, Etc. Subject to Sections 10.5 and
10.6, the Company will at all times preserve and keep in full force and effect
its corporate existence, and will at all times preserve and keep in full force
and effect the corporate existence of each of its Subsidiaries (unless merged
into the Company or a Wholly-Owned Subsidiary) and all rights and franchises of
the Company and its Subsidiaries unless, in the good faith judgment of the
Company, the termination of or failure to preserve and keep in full force and
effect such corporate existence, right or franchise could not, individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect.
Section 9.6. Guaranty by Subsidiaries. So long as the Guaranty
Agreement shall remain in effect, the Company will cause any Person which
becomes a Domestic Subsidiary after the Closing to enter into the Guaranty
Agreement, together with any security agreement necessary to cause the Guaranty
Agreement to rank pari passu with the Debt owing to the Bank Lenders, and to
deliver within five Business Days thereafter to each of the holders of the
Notes, a joinder agreement in respect of the Guaranty Agreement and any security
agreement similar to any that have been executed and delivered in favor of the
Bank Lenders.
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SECTION 10. NEGATIVE COVENANTS.
The Company covenants that so long as any of the Notes are outstanding:
Section 10.1. Consolidated Net Worth. The Company will not, at any
time, permit Consolidated Net Worth to be less than the sum of (a) $600,000,000,
plus (b) an aggregate amount equal to 50% of its Consolidated Net Income (but,
in each case, only if a positive number) for each completed fiscal quarter
beginning with the fiscal quarter ended March 31, 2000.
Section 10.2. Limitation on Consolidated Debt. The Company will not, at
any time, permit the Consolidated Debt Ratio to be greater than 3.50 to 1.00.
Section 10.3. Limitation on Priority Debt. The Company will not, at any
time, permit Priority Debt to exceed 20% of Consolidated Net Worth (determined
as of the then most recently ended fiscal quarter of the Company).
Section 10.4. Interest Charges Coverage Ratio. The Company will not, at
any time, permit the Interest Charges Coverage Ratio to be less than 2.00 to
1.00.
Section 10.5. Limitation on Liens. The Company will not, and will not
permit any of its Subsidiaries to, directly or indirectly create, incur, assume
or permit to exist (upon the happening of a contingency or otherwise), any Lien
on or with respect to any property or asset (including, without limitation, any
document or instrument in respect of goods or accounts receivable) of the
Company or any such Subsidiary, whether now owned or held or hereafter acquired,
or any income or profits therefrom, or assign or otherwise convey any right to
receive income or profits, provided that this Section 10.5 shall not limit the
Company's ability to pay dividends on its capital stock if and when declared by
the board of directors of the Company (unless it makes, or causes to be made,
effective provision whereby the Notes will be equally and ratably secured with
any and all other obligations thereby secured, such security to be pursuant to a
written agreement satisfactory to the Required Holders and, in any such case,
the Notes shall have the benefit, to the fullest extent that, and with such
priority as, the holders of the Notes may be entitled under applicable law, of
an equitable Lien on such property) except:
(a) Liens for taxes, assessments or other governmental charges
which are not yet due and payable or the payment of which is not at the
time required by Section 9.4;
(b) any attachment or judgment Lien, unless the judgment it
secures shall not, within 60 days after the entry thereof, have been
discharged or execution thereof stayed pending appeal, or shall not
have been discharged within 60 days after the expiration of any such
stay;
(c) Liens incidental to the conduct of business or the
ownership of properties and assets (including landlords', carriers',
warehousemen's, mechanics', materialmen's and other similar Liens) and
Liens to secure the performance of bids, tenders, leases, or trade
contracts, or to secure statutory obligations (including obligations
under workers
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compensation, unemployment insurance and other social security
legislation), surety or appeal bonds or other Liens incurred in the
ordinary course of business and not in connection with the borrowing of
money;
(d) leases or subleases entered into by the Company or its
Subsidiaries as either lessors or sublessors, easements, rights-of-way,
restrictions and other similar charges or encumbrances (including
zoning restrictions), in each case incidental to the ownership of
property or assets or the ordinary conduct of the business of the
Company or any of its Subsidiaries, provided that such Liens do not, in
the aggregate, detract from the value of such property in any material
way;
(e) Liens incidental to minor survey exceptions and similar
Liens, provided that such Liens do not, in the aggregate, materially
detract from the value of such property;
(f) Liens on property or assets of Subsidiaries securing Debt
owing to the Company or to another Subsidiary;
(g) Liens existing on the date of Closing described in
Schedule 10.5 which secure outstanding Debt of the Company and its
Subsidiaries referred to in Schedule 5.15 hereto;
(h) any Lien existing on property of a Person immediately
prior to its being consolidated with or merged into the Company or a
Subsidiary or its becoming a Subsidiary, or any Lien existing on any
property acquired by the Company or any Subsidiary at the time such
property is so acquired (whether or not the Debt secured thereby shall
have been assumed), provided that (i) no such Lien shall have been
created or assumed in contemplation of such consolidation or merger or
such Person's becoming a Subsidiary or such acquisition of property,
(ii) each such Lien shall extend solely to the item or items of
property so acquired, and (iii) the aggregate principal amount of all
Debt secured by any such Lien shall be permitted by the limitations set
forth in Section 10.2;
(i) Liens given to secure the payment of the purchase price
incurred in connection with the acquisition, lease (including any
Capital Lease) or construction of property (other than accounts
receivable or inventory) useful and intended to be used in carrying on
the business of the Company or a Subsidiary, including Liens existing
on such property at the time of acquisition, lease or construction
thereof or improvements thereon, or Liens incurred within 180 days of
such acquisition or the completion of such construction, provided that
(i) the Lien shall attach solely to the property acquired, purchased,
leased, constructed or improved, (ii) at the time of acquisition or
construction of such property, the aggregate amount remaining unpaid on
all Debt secured by Liens on such property, whether or not assumed by
the Company or a Subsidiary, shall not exceed an amount equal to the
lesser of the total purchase price or Fair Market Value at the time of
acquisition or construction of such property (as determined in good
faith by one or more officers of the Company or such Subsidiary, as the
case may be, to whom authority to enter into the transaction has been
delegated by the board of directors of the Company
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or such Subsidiary, as the case may be), and (iii) the aggregate
principal amount of all Debt secured by such Liens shall be permitted
by the limitations set forth in Section 10.2;
(j) Liens created by the Security Documents and similar
security documents securing Debt outstanding under this Agreement, the
Guaranty Agreement and the Bank Credit Agreement and any related
Guaranty of the Bank Credit Agreement provided that in the case of any
successor Bank Credit Agreement, the Bank Lenders and the holders of
the Notes shall continue to be parties to the Intercreditor Agreement;
(k) any extensions, renewals or replacements of any Lien
permitted by the preceding subparagraphs of this Section 10.5, provided
that (i) no additional property shall be encumbered by such Liens, (ii)
the unpaid principal amount of the Debt secured thereby shall not be
increased prior to or on or after the date of any extension, renewal or
replacement, (iii) the weighted average life to maturity of the Debt
secured by such Liens shall not be reduced, and (iv) at such time and
immediately after giving effect thereto, no Default or Event of Default
would exist; and
(l) in addition to the Liens permitted by the preceding
subparagraphs (a) through (k), inclusive, of this Section 10.5, Liens
securing Debt of the Company, provided that the aggregate principal
amount of such Debt shall not at any time exceed 10% of Consolidated
Net Worth (determined as of the then most recently ended fiscal quarter
of the Company).
Section 10.6. Merger, Consolidation. The Company will not, and will not
permit any Subsidiary to, consolidate with or be a party to a merger with any
other Person; provided, however, that:
(1) any Subsidiary may merge or consolidate with or into the
Company, so long as in any merger or consolidation involving the
Company, the Company shall be the surviving entity;
(2) any Subsidiary may merge or consolidate with or into any
other Person if either (x) the Subsidiary shall be the surviving
entity, or (y) if the Subsidiary is not the surviving entity, such
transaction is permitted by Section 10.7; and
(3) the Company may consolidate or merge with any other Person
if (i) either (x) the Company shall be the surviving entity, or (y) if
the surviving entity is other than the Company, (A) such entity is
organized under the laws of the United States or any jurisdiction
thereof, (B) such entity expressly assumes, by written agreement
satisfactory in scope and form to the Required Holders, all obligations
of the Company under the Notes, this Agreement and each Security
Document to which the Company is a party, (C) such entity shall cause
to be delivered to each holder of Notes an opinion of independent
counsel to the effect that all agreements or instruments effecting such
assumption are enforceable in accordance with their terms and comply
with the provisions of this Section 10.6 and otherwise satisfactory in
scope and form to the Required Holders, and
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(ii) at the time of such consolidation or merger and after giving
effect thereto, no Default or Event of Default shall have occurred and
be continuing.
Section 10.7. Sales of Assets. (a) The Company will not, and will not
permit any Subsidiary to, sell, lease or otherwise dispose of any substantial
part (as defined below) of the assets of the Company and its Subsidiaries;
provided, however, that the Company or any Subsidiary may sell lease or
otherwise dispose of assets constituting a substantial part of the assets of the
Company and its Subsidiaries if such assets are sold for Fair Market Value and,
at such time and after giving effect thereto, no Default or Event of Default
shall have occurred and be continuing, and an amount equal to the proceeds
received from such sale, lease or other disposition during such fiscal year
which shall be in excess of 10% of the book value of Consolidated Total Assets,
determined as of the end of the fiscal year immediately preceding such sale,
lease or other disposition, shall be used within 180 days of such disposition:
(1) to acquire property, plant and equipment or any business
entity (including the capital stock thereof) used or useful in carrying
on the business of the Company and its Subsidiaries and having a Fair
Market Value at least equal to the Fair Market Value of such assets
sold, leased or otherwise disposed of; or
(2) to prepay or retire Senior Debt of the Company and/or its
Subsidiaries, provided that if any Notes are prepaid pursuant to the
terms of this Section 10.7, such Notes shall also be prepaid in
accordance with the terms of Section 8.2 of this Agreement.
As used in this Section 10.7, a sale, lease or other disposition of
assets shall be deemed to be a "substantial part" of the assets of the Company
and its Subsidiaries if the book value of such assets, when added to the book
value of all other assets sold, leased or otherwise disposed of by the Company
and its Subsidiaries (other than in transactions (i) in the ordinary course of
business, (ii) in which the purchaser is the Company or a Subsidiary, or (iii)
which are Excluded Sale and Leaseback Transactions) during such fiscal year,
exceeds 10% of the book value of Consolidated Total Assets, determined as of the
end of the fiscal quarter immediately preceding such sale, lease or other
disposition.
Section 10.8. Nature of Business. Neither the Company nor any
Subsidiary will engage in any business if, as a result, the general nature of
the business, taken on a consolidated basis, which would then be engaged in by
the Company and its Subsidiaries would be substantially changed from the general
nature of the business engaged in by the Company and its Subsidiaries on the
date of this Agreement.
Section 10.9. Transactions with Affiliates. The Company will not and
will not permit any Subsidiary to enter into directly or indirectly any Material
transaction or Material group of related transactions (including without
limitation the purchase, lease, sale or exchange of properties of any kind or
the rendering of any service) with any Affiliate (other than the Company or
another Subsidiary), except upon fair and reasonable terms no less favorable to
the Company or such Subsidiary than would be obtainable in a comparable
arm's-length transaction with a Person not an Affiliate.
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Section 10.10. Further Assurances. So long as any Security Document and
the Guaranty Agreement shall remain in effect, if the Collateral Agent shall
resign or be removed or the Intercreditor Agreement shall no longer be in full
force and effect, the Company will, and will cause each Guarantor to, execute
and deliver to each holder of a Note such additional documents (including
amendments to the Security Documents) as the holders of the Notes shall
reasonably request so that there shall continue to be a Collateral Agent under
the Security Documents and to insure that the Lien of the Security Documents
shall continue to be in full force and effect.
So long as any Security Document shall remain in effect, the Company
also agrees at its own expense to cause or use its reasonable commercial efforts
to cause the Security Documents and all supplements and amendments thereto and
all financing and continuation statements and similar notices required by
applicable law at all times to be kept, recorded and filed in such manner and in
such places to maintain the effectiveness of any original or supplemental
filings under the Uniform Commercial Code or comparable law in any relevant
jurisdiction to maintain, in full force and effect, the Lien and security
interest granted by the Company and the Guarantors to the holders of the Notes
or the Collateral Agent for the benefit of the holders of the Notes pursuant to
the Security Documents.
SECTION 11. EVENTS OF DEFAULT.
An "Event of Default" shall exist if any of the following conditions or
events shall occur and be continuing:
(a) the Company defaults in the payment of any principal or
Make-Whole Amount, if any, on any Note when the same becomes due and
payable, whether at maturity or at a date fixed for prepayment or by
declaration or otherwise; or
(b) the Company defaults in the payment of any interest on any
Note for more than five Business Days after the same becomes due and
payable; or
(c) the Company defaults in the performance of or compliance
with any term contained in Section 10.4, Section 10.6 or Section 10.7
and such default is not remedied within five (5) Business Days of the
occurrence thereof; or
(d) the Company defaults in the performance of or compliance
with any term contained herein or in any Supplement (other than those
referred to in paragraphs (a), (b) and (c) of this Section 11) and such
default is not remedied within 30 days after the earlier of (i) a
Responsible Officer obtaining actual knowledge of such default and (ii)
the Company receiving written notice of such default from any holder of
a Note (any such written notice to be identified as a "notice of
default" and to refer specifically to this paragraph (d) of Section
11); or
(e) prior to the release of any Guarantor from the Guaranty
Agreement upon the occurrence of a Guaranty Release Event, a default
shall occur in the observance or performance of any covenant or
agreement contained in the Guaranty Agreement by such Guarantor and
such default shall continue beyond the period of grace, if any, allowed
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with respect thereto or the Guaranty Agreement shall cease to be in
full force and effect for any reason whatsoever, including, without
limitation, a determination by any governmental body or court that such
agreement is invalid, void or unenforceable against such Guarantor or
such Guarantor shall contest or deny in writing the validity or
enforceability of any of its obligations under the Guaranty Agreement;
or
(f) prior to the release of any Security Document upon the
occurrence of a Collateral Release Event, a default shall occur in the
observance or performance of any covenant or agreement contained in
such Security Document and such default shall continue beyond the
period of grace, if any, allowed with respect thereto or such Security
Document creating or granting a Lien on any Collateral shall cease to
be in full force and effect or the Company or any Guarantor shall deny
or disaffirm the validity of any such Lien;
(g) any representation or warranty made in writing by or on
behalf of the Company or any Guarantor or by any officer of the Company
or any Guarantor in this Agreement, any Security Document or the
Guaranty Agreement or in any writing furnished in connection with the
transactions contemplated hereby or thereby proves to have been false
or incorrect in any material respect on the date as of which made; or
(h) (i) the Company or any Significant Subsidiary is in
default (as principal or as guarantor or other surety) in the payment
of any principal of or premium or make-whole amount or interest on Debt
other than the Notes (individually or in the aggregate) that is
outstanding in an aggregate principal amount of 5% or more of
Consolidated Net Worth beyond any period of grace provided with respect
thereto, or (ii) the Company or any Significant Subsidiary is in
default in the performance of or compliance with any term of any
instrument, mortgage, indenture or other agreement relating to any Debt
other than the Notes (individually or in the aggregate) in an aggregate
principal amount of 5% or more of Consolidated Net Worth or any other
condition exists, and as a consequence of such default or condition
such Debt has become, or has been declared, due and payable before its
stated maturity or before its regularly scheduled dates of payment, or
(iii) as a consequence of the occurrence or continuation of any event
or condition (other than the passage of time or the right of the holder
of Debt to convert such Debt into equity interests), the Company or any
Significant Subsidiary has become obligated to purchase or repay Debt
other than the Notes before its regular maturity or before its
regularly scheduled dates of payment in an aggregate outstanding
principal amount of 5% or more of Consolidated Net Worth; or
(i) the Company or any Significant Subsidiary (i) is generally
not paying, or admits in writing its inability to pay, its debts as
they become due, (ii) files, or consents by answer or otherwise to the
filing against it of, a petition for relief or reorganization or
arrangement or any other petition in bankruptcy, for liquidation or to
take advantage of any bankruptcy, insolvency, reorganization,
moratorium or other similar law of any jurisdiction, (iii) makes an
assignment for the benefit of its creditors, (iv) consents to the
appointment of a custodian, receiver, trustee or other officer with
similar powers with respect to it or with respect to any substantial
part of its property, (v) is adjudicated as
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insolvent or to be liquidated, or (vi) takes corporate action for the
purpose of any of the foregoing; or
(j) a court or governmental authority of competent
jurisdiction enters an order appointing, without consent by the Company
or any of its Significant Subsidiaries, a custodian, receiver, trustee
or other officer with similar powers with respect to it or with respect
to any substantial part of its property, or constituting an order for
relief or approving a petition for relief or reorganization or any
other petition in bankruptcy or for liquidation or to take advantage of
any bankruptcy or insolvency law of any jurisdiction, or ordering the
dissolution, winding-up or liquidation of the Company or any of its
Significant Subsidiaries, or any such petition shall be filed against
the Company or any of its Significant Subsidiaries and such petition
shall not be dismissed within 60 days; or
(k) a final judgment or judgments at any one time outstanding
for the payment of money aggregating an amount equal to 5% or more of
Consolidated Net Worth are rendered against one or more of the Company
and its Significant Subsidiaries and which judgments are not, within 60
days after entry thereof, bonded, discharged or stayed pending appeal,
or are not discharged within 60 days after the expiration of such stay;
or
(l) If (i) any Plan shall fail to satisfy the minimum funding
standards of ERISA or the Code for any plan year or part thereof or a
waiver of such standards or extension of any amortization period is
sought or granted under Section 412 of the Code, (ii) a notice of
intent to terminate any Plan shall have been or is reasonably expected
to be filed with the PBGC or the PBGC shall have instituted proceedings
under Section 4042 of ERISA to terminate or appoint a trustee to
administer any Plan or the PBGC shall have notified the Company or any
ERISA Affiliate that a Plan may become a subject of any such
proceedings, (iii) the aggregate "amount of unfunded benefit
liabilities" (within the meaning of Section 4001(a)(18) of ERISA) under
all Plans, determined in accordance with Title IV of ERISA, shall
exceed an amount equal to 5% or more of Consolidated Net Worth, (iv)
the Company or any ERISA Affiliate shall have incurred or is reasonably
expected to incur any liability pursuant to Title I or IV of ERISA or
the penalty or excise tax provisions of the Code relating to employee
benefit plans, (v) the Company or any ERISA Affiliate withdraws from
any Multiemployer Plan, or (vi) the Company or any Subsidiary
establishes or amends any employee welfare benefit plan that provides
post-employment welfare benefits in a manner that would increase the
liability of the Company or any Subsidiary thereunder; and any such
event or events described in clauses (i) through (vi) above, either
individually or together with any other such event or events, could
reasonably be expected to have a Material Adverse Effect.
As used in Section 11(l), the terms "employee benefit plan" and "employee
welfare benefit plan" shall have the respective meanings assigned to such terms
in Section 3 of ERISA.
SECTION 12. REMEDIES ON DEFAULT, ETC.
Section 12.1. Acceleration. (a) If an Event of Default with respect to
the Company described in paragraph (i) or (j) of Section 11 (other than an Event
of Default described in clause
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(i) of paragraph (i) or described in clause (vi) of paragraph (i) by virtue of
the fact that such clause encompasses clause (i) of paragraph (i)) has occurred,
all the Notes of every Series then outstanding shall automatically become
immediately due and payable.
(b) If any other Event of Default has occurred and is continuing, any
holder or holders of more than 50% in aggregate principal amount of each Series
of the Notes at the time outstanding may at any time at its or their option, by
notice or notices to the Company, declare all the Notes of such Series then
outstanding to be immediately due and payable.
(c) If any Event of Default described in paragraph (a) or (b) of
Section 11 has occurred and is continuing with respect to any Series of Notes,
any holder or holders of Notes at the time outstanding affected by such Event of
Default may at any time, at its or their option, by notice or notices to the
Company, declare all the Notes held by such holder or holders to be immediately
due and payable.
Upon any Note's becoming due and payable under this Section 12.1,
whether automatically or by declaration, such Note will forthwith mature and the
entire unpaid principal amount of such Note, plus (i) all accrued and unpaid
interest thereon and (ii) the Make-Whole Amount determined in respect of such
principal amount (to the full extent permitted by applicable law), shall all be
immediately due and payable, in each and every case without presentment, demand,
protest or further notice, all of which are hereby waived. The Company
acknowledges, and the parties hereto agree, that each holder of a Note has the
right to maintain its investment in the Notes free from repayment by the Company
(except as herein specifically provided for) and that the provision for payment
of a Make-Whole Amount by the Company in the event that the Notes are prepaid or
are accelerated as a result of an Event of Default, is intended to provide
compensation for the deprivation of such right under such circumstances.
Section 12.2. Other Remedies. If any Default or Event of Default has
occurred and is continuing, and irrespective of whether any Notes have become or
have been declared immediately due and payable under Section 12.1, the Required
Holders at the time outstanding may proceed to protect and enforce the rights of
the holders by an action at law, suit in equity or other appropriate proceeding,
whether for the specific performance of any agreement contained herein or in any
Note, or for an injunction against a violation of any of the terms hereof or
thereof, or in aid of the exercise of any power granted hereby or thereby or by
law or otherwise.
Section 12.3. Rescission. At any time after any Notes of any Series
have been declared due and payable pursuant to clause (b) or (c) of Section
12.1, the holders of not less than 50% in principal amount of the Notes of such
Series, taken individually, then outstanding, by written notice to the Company,
may rescind and annul any such declaration and its consequences if (a) the
Company has paid all overdue interest on the Notes of such Series, all principal
of and Make-Whole Amount, if any, on any Notes of such Series that are due and
payable and are unpaid other than by reason of such declaration, and all
interest on such overdue principal and Make-Whole Amount, if any, and (to the
extent permitted by applicable law) any overdue interest in respect of the Notes
of such Series, at the Default Rate, (b) all Events of Default and Defaults,
other than non-payment of amounts that have become due solely by reason of such
declaration, have been cured or have been waived pursuant to Section 17, and (c)
no judgment or
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decree has been entered for the payment of any monies due pursuant hereto or to
any Notes. No rescission and annulment under this Section 12.3 will extend to or
affect any subsequent Event of Default or Default or impair any right consequent
thereon.
Section 12.4. No Waivers or Election of Remedies, Expenses, Etc. No
course of dealing and no delay on the part of any holder of any Note in
exercising any right, power or remedy shall operate as a waiver thereof or
otherwise prejudice such holder's rights, powers or remedies. No right, power or
remedy conferred by this Agreement or by any Note upon any holder thereof shall
be exclusive of any other right, power or remedy referred to herein or therein
or now or hereafter available at law, in equity, by statute or otherwise.
Without limiting the obligations of the Company under Section 15, the Company
will pay to the holder of each Note on demand such further amount as shall be
sufficient to cover all costs and expenses of such holder incurred in any
enforcement or collection under this Section 12, including, without limitation,
the reasonable attorneys' fees, expenses and disbursements for the holders as
set forth in Section 15.
SECTION 13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.
Section 13.1. Registration of Notes. The Company shall keep at its
principal executive office a register for the registration and registration of
transfers of Notes. The name and address of each holder of one or more Notes,
each transfer thereof and the name and address of each transferee of one or more
Notes shall be registered in such register. Prior to due presentment for
registration of transfer, the Person in whose name any Note shall be registered
shall be deemed and treated as the owner and holder thereof for all purposes
hereof, and the Company shall not be affected by any notice or knowledge to the
contrary. The Company shall give to any holder of a Note that is an
Institutional Investor promptly upon request therefor, a complete and correct
copy of the names and addresses of all registered holders of Notes.
Section 13.2. Transfer and Exchange of Notes. Upon surrender of any
Note at the principal executive office of the Company for registration of
transfer or exchange (and in the case of a surrender for registration of
transfer, duly endorsed or accompanied by a written instrument of transfer duly
executed by the registered holder of such Note or its attorney duly authorized
in writing and accompanied by the address for notices of each transferee of such
Note or part thereof), the Company shall execute and deliver not more than 5
Business Days following surrender of such Note, at the Company's expense (except
as provided below), one or more new Notes (as requested by the holder thereof)
of the same Series (and of the same tranche if such Series has separate
tranches) in exchange therefor, in an aggregate principal amount equal to the
unpaid principal amount of the surrendered Note. Each such new Note shall be
payable to such Person as such holder may request and shall be substantially in
the form of the Note of such Series originally issued hereunder or pursuant to
any Supplement. Each such new Note shall be dated and bear interest from the
date to which interest shall have been paid on the surrendered Note or dated the
date of the surrendered Note if no interest shall have been paid thereon. The
Company may require payment of a sum sufficient to cover any stamp tax or
governmental charge imposed in respect of any such transfer of Notes. Notes
shall not be transferred in denominations of less than $100,000, provided that
if necessary to enable the registration of transfer by a holder of its entire
holding of Notes, one Note may be in a denomination of less than $100,000. Any
transferee, by its acceptance of a Note registered in its name (or the name of
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its nominee), shall be deemed to have made the representation set forth in
Section 6.2, provided that such holder may (in reliance upon information
provided by the Company, which shall not be unreasonably withheld) make a
representation to the effect that the purchase by such holder of any Note will
not constitute a non-exempt prohibited transaction under Section 406(a) of
ERISA.
The Notes have not been registered under the Securities Act or under
the securities laws of any state and may not be transferred or resold unless
registered under the Securities Act and all applicable state securities laws or
unless an exemption from the requirement for such registration is available.
Section 13.3. Replacement of Notes. Upon receipt by the Company of
evidence reasonably satisfactory to it of the ownership of and the loss, theft,
destruction or mutilation of any Note (which evidence shall be, in the case of
an Institutional Investor, notice from such Institutional Investor of such
ownership and such loss, theft, destruction or mutilation), and
(a) in the case of loss, theft or destruction, of indemnity
reasonably satisfactory to it (provided that if the holder of such Note
is, or is a nominee for, an original Purchaser or another holder of a
Note with a minimum net worth of at least $50,000,000, such Person's
own unsecured agreement of indemnity shall be deemed to be
satisfactory), or
(b) in the case of mutilation, upon surrender and cancellation
thereof,
the Company at its own expense shall execute and deliver not more than five
Business Days following satisfaction of such conditions, in lieu thereof, a new
Note of the same Series (and of the same tranche if such Series has separate
tranches), dated and bearing interest from the date to which interest shall have
been paid on such lost, stolen, destroyed or mutilated Note or dated the date of
such lost, stolen, destroyed or mutilated Note if no interest shall have been
paid thereon.
SECTION 14. PAYMENTS ON NOTES.
Section 14.1. Place of Payment. Subject to Section 14.2, payments of
principal, Make-Whole Amount, if any, and interest becoming due and payable on
the Notes shall be made in New York, New York at the principal office of Bank of
America, N.A. in such jurisdiction. The Company may at any time, by notice to
each holder of a Note, change the place of payment of the Notes so long as such
place of payment shall be either the principal office of the Company in such
jurisdiction or the principal office of a bank or trust company in such
jurisdiction.
Section 14.2. Home Office Payment. So long as any Purchaser or such
Purchaser's nominee shall be the holder of any Note, and notwithstanding
anything contained in Section 14.1 or in such Note to the contrary, the Company
will pay all sums becoming due on such Note for principal, Make-Whole Amount, if
any, and interest by the method and at the address specified for such purpose
for such Purchaser on Schedule A hereto or, in the case of any Additional
Purchaser, Schedule A attached to any Supplement pursuant to which such
Additional Purchaser is a party, or by such other method or at such other
address as such Purchaser or Additional Purchaser shall have from time to time
specified to the Company in writing for such purpose,
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without the presentation or surrender of such Note or the making of any notation
thereon, except that upon written request of the Company made concurrently with
or reasonably promptly after payment or prepayment in full of any Note, such
Purchaser or Additional Purchaser shall surrender such Note for cancellation,
reasonably promptly after any such request, to the Company at its principal
executive office or at the place of payment most recently designated by the
Company pursuant to Section 14.1. Prior to any sale or other disposition of any
Note held by any Purchaser or Additional Purchaser or such Person's nominee,
such Person will, at its election, either endorse thereon the amount of
principal paid thereon and the last date to which interest has been paid thereon
or surrender such Note to the Company in exchange for a new Note or Notes
pursuant to Section 13.2. The Company will afford the benefits of this Section
14.2 to any Institutional Investor that is the direct or indirect transferee of
any Note.
SECTION 15. EXPENSES, ETC.
Section 15.1. Transaction Expenses. Whether or not the transactions
contemplated hereby are consummated, the Company will pay all reasonable costs
and expenses (including reasonable attorneys' fees of one special counsel and,
if reasonably required, local or other counsel) incurred by the Purchasers and
the holders of Notes in connection with such transactions and in connection with
any amendments, waivers or consents under or in respect of this Agreement
(including any Supplement), the Security Documents, the Guaranty Agreement, the
Intercreditor Agreement or the Notes (whether or not such amendment, waiver or
consent becomes effective), including, without limitation: (a) the reasonable
costs and expenses incurred in enforcing or defending (or determining whether or
how to enforce or defend) any rights under this Agreement (including any
Supplement), the Security Documents, the Guaranty Agreement, the Intercreditor
Agreement or the Notes or in responding to any subpoena or other legal process
or informal investigative demand by any Governmental Authority issued in
connection with this Agreement (including any Supplement), the Security
Documents, the Guaranty Agreement, the Intercreditor Agreement or the Notes, or
by reason of being a holder of any Note, and (b) the reasonable costs and
expenses, including financial advisors' fees, incurred in connection with the
insolvency or bankruptcy of the Company or any Subsidiary or in connection with
any work-out or restructuring of the transactions contemplated hereby and by the
Notes. The Company will pay, and will save each Purchaser and each other holder
of a Note harmless from, all claims in respect of any reasonable fees, costs or
expenses if any, of brokers and finders (other than those retained by the
Purchasers).
Section 15.2. Survival. The obligations of the Company under this
Section 15 will survive the payment or transfer of any Note, the enforcement,
amendment or waiver of any provision of this Agreement, any Supplement or the
Notes, and the termination of this Agreement or any Supplement.
SECTION 16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.
All representations and warranties contained herein or in any
Supplement shall survive the execution and delivery of this Agreement or such
Supplement and the related Notes, the purchase or transfer by any Purchaser or
any Additional Purchaser of any such Note or portion
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thereof or interest therein and may be relied upon by any subsequent holder of
any such Note, regardless of any investigation made at any time by or on behalf
of any Purchaser or any Additional Purchaser or any other holder of any such
Note. All statements contained in any certificate or other instrument delivered
by or on behalf of the Company pursuant to this Agreement or any Supplement
shall be deemed representations and warranties of the Company under this
Agreement; provided, that the representations and warranties contained in any
Supplement shall only be made for the benefit of the Additional Purchasers which
are party to such Supplement and the holders, including subsequent holders of
any Note issued pursuant to such Supplement, and shall not require the consent
of the holders of existing Notes. Subject to the preceding sentence, this
Agreement (including every Supplement), the Security Documents, the
Intercreditor Agreement, the Guaranty Agreement and the Notes embody the entire
agreement and understanding between the Purchasers and the Additional Purchasers
and the Company and supersede all prior agreements and understandings relating
to the subject matter hereof.
SECTION 17. AMENDMENT AND WAIVER.
Section 17.1. Requirements. (a) This Agreement (including any
Supplement) and the Notes may be amended, and the observance of any term hereof
or of the Notes may be waived (either retroactively or prospectively), with (and
only with) the written consent of the Company and the holders of Notes holding
more than 50% in aggregate principal amount of the Notes of each Series at the
time outstanding, except that (a) no amendment or waiver of any of the
provisions of Section 1, 2, 3, 4, 5, 6 or 21 hereof or the corresponding
provision of any Supplement, or any defined term (as it is used in any such
Section or such corresponding provision of any Supplement), will be effective as
to any holder of Notes unless consented to by such holder of Notes in writing,
and (b) no such amendment or waiver may, without the written consent of all of
the holders of Notes at the time outstanding affected thereby, (i) subject to
the provisions of Section 12 relating to acceleration or rescission, change the
amount or time of any prepayment or payment of principal of, or reduce the rate
or change the time of payment or method of computation of interest or of the
Make-Whole Amount on, the Notes, (ii) change the percentage of the principal
amount of the Notes the holders of which are required to consent to any such
amendment or waiver, or (iii) amend any of Sections 8, 11(a), 11(b), 12, 17 or
20.
(b) Supplements. Notwithstanding anything to the contrary contained
herein, the Company may enter into any Supplement providing for the issuance of
one or more Series of Additional Notes consistent with Sections 2.4 and 4.18
hereof without obtaining the consent of any holder of any other Series of Notes.
Section 17.2. Solicitation of Holders of Notes.
(a) Solicitation. The Company will provide each holder of the Notes
(irrespective of the amount of Notes then owned by it) with sufficient
information, sufficiently far in advance of the date a decision is required, to
enable such holder to make an informed and considered decision with respect to
any proposed amendment, waiver or consent in respect of any of the provisions
hereof, any Supplement or of the Notes. The Company will deliver executed or
true and correct copies of each amendment, waiver or consent effected pursuant
to the provisions of
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this Section 17 to each holder of outstanding Notes promptly following the date
on which it is executed and delivered by, or receives the consent or approval
of, the requisite holders of Notes.
(b) Payment. The Company will not directly or indirectly pay or cause
to be paid any remuneration, whether by way of supplemental or additional
interest, fee or otherwise, or grant any security, to any holder of Notes as
consideration for or as an inducement to the entering into by any holder of
Notes of any waiver or amendment of any of the terms and provisions hereof or
any Supplement unless such remuneration is concurrently paid, or security is
concurrently granted, on the same terms, ratably to each holder of Notes then
outstanding even if such holder did not consent to such waiver or amendment.
Section 17.3. Binding Effect, Etc. Any amendment or waiver consented to
as provided in this Section 17 applies equally to all holders of Notes and is
binding upon them and upon each future holder of any Note and upon the Company
without regard to whether such Note has been marked to indicate such amendment
or waiver. No such amendment or waiver will extend to or affect any obligation,
covenant, agreement, Default or Event of Default not expressly amended or waived
or impair any right consequent thereon. No course of dealing between the Company
and the holder of any Note nor any delay in exercising any rights hereunder or
under any Note shall operate as a waiver of any rights of any holder of such
Note. As used herein, the term "this Agreement" and references thereto shall
mean this Agreement as it may from time to time be amended or supplemented.
Section 17.4. Notes Held by Company, Etc. Solely for the purpose of
determining whether the holders of the requisite percentage of the aggregate
principal amount of Notes then outstanding approved or consented to any
amendment, waiver or consent to be given under this Agreement or the Notes, or
have directed the taking of any action provided herein or in the Notes to be
taken upon the direction of the holders of a specified percentage of the
aggregate principal amount of Notes then outstanding, Notes directly or
indirectly owned by the Company or any of its Affiliates shall be deemed not to
be outstanding.
SECTION 18. NOTICES.
All notices and communications provided for hereunder shall be in
writing and sent (a) by telefacsimile if the sender on the same day sends a
confirming copy of such notice by a recognized overnight delivery service
(charges prepaid), or (b) by registered or certified mail with return receipt
requested (postage prepaid), or (c) by a recognized overnight delivery service
(with charges prepaid). Any such notice must be sent:
(i) if to a Purchaser or such Purchaser's nominee, to such
Purchaser or such Purchaser's nominee at the address specified for such
communications in Schedule A to this Agreement, or at such other
address as such Purchaser or such Purchaser's nominee shall have
specified to the Company in writing pursuant to this Section 18,
(ii) if to an Additional Purchaser or such Additional
Purchaser's nominee, to such Additional Purchaser or such Additional
Purchaser's nominee at the address specified for such communications in
Schedule A to any Supplement, or at such other
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address as such Additional Purchaser or such Additional Purchaser's
nominee shall have specified to the Company in writing,
(iii) if to any other holder of any Note, to such holder at
such address as such other holder shall have specified to the Company
in writing pursuant to this Section 18, or
(iv) if to the Company, to the Company at its address set
forth at the beginning hereof to the attention of Chief Financial
Officer, with a copy to the General Counsel, or at such other address
as the Company shall have specified to the holder of each Note in
writing.
Notices under this Section 18 will be deemed given only when actually received.
SECTION 19. REPRODUCTION OF DOCUMENTS.
This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by each Purchaser at the Closing (except the
Notes themselves), and (c) financial statements, certificates and other
information previously or hereafter furnished to each Purchaser, may be
reproduced by such Purchaser by any photographic, photostatic, microfilm,
microcard, miniature photographic or other similar process and such Purchaser
may destroy any original document so reproduced. The Company agrees and
stipulates that, to the extent permitted by applicable law, any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by such Purchaser in the
regular course of business) and any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence. This
Section 19 shall not prohibit the Company or any other holder of Notes from
contesting any such reproduction to the same extent that it could contest the
original, or from introducing evidence to demonstrate the inaccuracy of any such
reproduction.
SECTION 20. CONFIDENTIAL INFORMATION.
For the purposes of this Section 20, "Confidential Information" means
information delivered to any Purchaser by or on behalf of the Company or any
Subsidiary in connection with the transactions contemplated by or otherwise
pursuant to this Agreement that is proprietary in nature and that was clearly
marked or labeled or otherwise adequately identified when received by such
Purchaser as being confidential information of the Company or such Subsidiary,
provided that such term does not include information that (a) was publicly known
or otherwise known to such Purchaser prior to the time of such disclosure, (b)
subsequently becomes publicly known through no act or omission by such Purchaser
or any Person acting on such Purchaser's behalf, (c) otherwise becomes known to
such Purchaser other than through disclosure by the Company or any Subsidiary or
(d) constitutes financial statements delivered to such Purchaser under Section
7.1 that are otherwise publicly available. Each Purchaser will maintain the
confidentiality of such Confidential Information in accordance with procedures
adopted by such Purchaser in good faith to protect confidential information of
third parties delivered to such
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Purchaser, provided that such Purchaser may deliver or disclose Confidential
Information to (i) such Purchaser's directors, trustees, officers, employees,
agents, attorneys and affiliates (to the extent such disclosure reasonably
relates to the administration of the investment represented by such Purchaser's
Notes), (ii) such Purchaser's financial advisors and other professional advisors
who agree to hold confidential the Confidential Information substantially in
accordance with the terms of this Section 20, (iii) any other holder of any
Note, (iv) any Institutional Investor to which such Purchaser sells or offers to
sell such Note or any part thereof or any participation therein (if such Person
has agreed in writing prior to its receipt of such Confidential Information to
be bound by the provisions of this Section 20), (v) any Person from which such
Purchaser offers to purchase any security of the Company (if such Person has
agreed in writing prior to its receipt of such Confidential Information to be
bound by the provisions of this Section 20), (vi) any federal or state
regulatory authority having jurisdiction over such Purchaser, (vii) the National
Association of Insurance Commissioners or any similar organization, or any
nationally recognized rating agency that requires access to information about
such Purchaser's investment portfolio, or (viii) any other Person to which such
delivery or disclosure may be necessary or appropriate (w) to effect compliance
with any law, Rule, regulation or order applicable to such Purchaser, (x) in
response to any subpoena or other legal process, provided that, to the extent
permitted by law, each holder will use reasonable efforts to notify the Company
of any request to disclose Confidential Information requested pursuant to any
subpoena or other legal process, provided further that the failure to notify the
Company of any such request shall not result in any liability to such holder,
(y) in connection with any litigation to which such Purchaser is a party or (z)
if an Event of Default has occurred and is continuing, to the extent such
Purchaser may reasonably determine such delivery and disclosure to be necessary
or appropriate in the enforcement or for the protection of the rights and
remedies under such Purchaser's Notes and this Agreement. Each holder of a Note,
by its acceptance of a Note, will be deemed to have agreed to be bound by and to
be entitled to the benefits of this Section 20 as though it were a party to this
Agreement. On reasonable request by the Company in connection with the delivery
to any holder of a Note of information required to be delivered to such holder
under this Agreement or requested by such holder (other than a holder that is a
party to this Agreement or its nominee), such holder will enter into an
agreement with the Company embodying the provisions of this Section 20.
SECTION 21. SUBSTITUTION OF PURCHASER.
Each Purchaser shall have the right to substitute any one of such
Purchaser's Affiliates as the purchaser of the Notes that such Purchaser has
agreed to purchase hereunder, by written notice to the Company, which notice
shall be signed by both such Purchaser and such Purchaser's Affiliate, shall
contain such Affiliate's agreement to be bound by this Agreement and shall
contain a confirmation by such Affiliate of the accuracy with respect to it of
the representations set forth in Section 6. Upon receipt of such notice,
wherever the word "Purchaser" is used in this Agreement (other than in this
Section 21), such word shall be deemed to refer to such Affiliate in lieu of
such Purchaser. In the event that such Affiliate is so substituted as a
purchaser hereunder and such Affiliate thereafter transfers to such Purchaser
all of the Notes then held by such Affiliate, upon receipt by the Company of
notice of such transfer, wherever the word "Purchaser" is used in this Agreement
(other than in this Section 21), such
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word shall no longer be deemed to refer to such Affiliate, but shall refer to
such Purchaser, and such Purchaser shall have all the rights of an original
holder of the Notes under this Agreement.
SECTION 22. MISCELLANEOUS.
Section 22.1. Successors and Assigns. All covenants and other
agreements contained in this Agreement (including all covenants and other
agreements contained in any Supplement) by or on behalf of any of the parties
hereto bind and inure to the benefit of their respective successors and assigns
(including, without limitation, any subsequent holder of a Note) whether so
expressed or not.
Section 22.2. Payments Due on Non-Business Days. Anything in this
Agreement or the Notes to the contrary notwithstanding, any payment of principal
of or Make-Whole Amount or interest on any Note that is due on a date other than
a Business Day shall be made on the next succeeding Business Day without
including the additional days elapsed in the computation of the interest payable
on such next succeeding Business Day.
Section 22.3. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall (to the full extent permitted by law)
not invalidate or render unenforceable such provision in any other jurisdiction.
Section 22.4. Construction. Each covenant contained herein shall be
construed (absent express provision to the contrary) as being independent of
each other covenant contained herein, so that compliance with any one covenant
shall not (absent such an express contrary provision) be deemed to excuse
compliance with any other covenant. Where any provision herein refers to action
to be taken by any Person, or which such Person is prohibited from taking, such
provision shall be applicable whether such action is taken directly or
indirectly by such Person.
Section 22.5. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be an original but all of which
together shall constitute one instrument. Each counterpart may consist of a
number of copies hereof, each signed by less than all, but together signed by
all, of the parties hereto.
Section 22.6. Governing Law. This Agreement shall be construed and
enforced in accordance with, and the rights of the parties shall be governed by,
the law of the State of New York excluding choice-of-law principles of the law
of such State that would require the application of the laws of a jurisdiction
other than such State.
Section 22.7. Legal Rate of Interest. Regardless of any provision
contained in this Agreement or in any Guaranty Agreement or the Security
Documents, the rate of interest borne by the Notes shall not exceed the maximum
amount of nonusurious interest that may be contracted for, taken, reserved,
charged or received under any applicable law; any interest in excess of that
maximum amount shall be credited on the principal of the Notes of the applicable
Series or, if that has been paid, refunded. On any acceleration or required or
permitted
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prepayment, any such excess shall be canceled automatically as of the
acceleration or prepayment or, if already paid, credited on the principal of the
Notes of the applicable Series or, if the principal of the Notes of such Series
has been paid, refunded. In determining whether or not the interest paid or
payable, under any specific contingency, exceeds the maximum amount of
nonusurious interest, the Company and holders of the Notes shall, to the maximum
extent permitted under applicable law, (a) characterize any nonprincipal payment
as an expense, fee or premium rather than as interest, (b) exclude voluntary
prepayments and the effects thereof, and (c) spread the total amount of interest
throughout the entire contemplated term of the Notes of the applicable Series.
Section 22.8. Submission to Process. THE COMPANY HEREBY AGREES THAT ANY
LEGAL ACTION OR PROCEEDING AGAINST THE COMPANY WITH RESPECT TO THIS AGREEMENT,
ANY SECURITY DOCUMENT OR THE NOTES MAY BE BROUGHT IN THE COURTS OF THE STATE OF
NEW YORK OR (TO THE EXTENT THEY HAVE SUBJECT MATTER JURISDICTION) OF THE UNITED
STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK AS THE HOLDERS OF 51% IN
PRINCIPAL AMOUNT OF THE NOTES MAY ELECT, AND, BY EXECUTION AND DELIVERY HEREOF,
THE COMPANY ACCEPTS AND CONSENTS, FOR ITSELF AND IN RESPECT TO ITS PROPERTY,
GENERALLY AND UNCONDITIONALLY, TO THE JURISDICTION OF THE AFORESAID COURTS AND
AGREES THAT SUCH JURISDICTION SHALL BE EXCLUSIVE, UNLESS WAIVED BY THE HOLDERS
OF 51% IN PRINCIPAL AMOUNT OF THE NOTES IN WRITING, WITH RESPECT TO ANY ACTION
OR PROCEEDING BROUGHT BY THE COMPANY AGAINST THE HOLDERS AND ANY QUESTIONS
RELATING TO USURY. THE COMPANY WAIVES (TO THE EXTENT PERMITTED BY APPLICABLE
LAW) ANY RIGHT TO STAY OR TO DISMISS ANY ACTION OR PROCEEDING BROUGHT BEFORE
SAID COURTS ON THE BASIS OF FORUM NON CONVENIENS. IN FURTHERANCE OF THE
FOREGOING, THE COMPANY HEREBY IRREVOCABLY DESIGNATES AND APPOINTS CAPITOL
SERVICES INC., AS AGENT OF THE COMPANY TO RECEIVE SERVICE OF ALL PROCESS BROUGHT
AGAINST THE COMPANY EACH WITH RESPECT TO ANY SUCH PROCEEDING IN ANY SUCH COURT
IN NEW YORK, SUCH SERVICE BEING HEREBY ACKNOWLEDGED BY THE COMPANY TO BE
EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT. COPIES OF ANY SUCH PROCESS SO
SERVED SHALL ALSO, IF PERMITTED BY LAW, BE SENT BY REGISTERED MAIL TO THE
COMPANY IN ACCORDANCE WITH SECTION 18 BUT THE FAILURE OF THE COMPANY TO RECEIVE
SUCH COPIES SHALL NOT AFFECT IN ANY WAY THE SERVICE OF SUCH PROCESS AS
AFORESAID. THE COMPANY SHALL FURNISH TO THE HOLDERS A CONSENT OF CAPITOL
SERVICES INC. AGREEING TO ACT HEREUNDER PRIOR TO THE DATE OF CLOSING. NOTHING
HEREIN SHALL AFFECT THE RIGHT OF THE HOLDERS TO SERVE PROCESS IN ANY OTHER
MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF THE HOLDERS TO BRING
PROCEEDINGS AGAINST THE COMPANY IN THE COURTS OF ANY OTHER JURISDICTION. IF FOR
ANY REASON CAPITOL SERVICES INC. SHALL RESIGN OR OTHERWISE CEASE TO ACT AS
AGENT, THE COMPANY HEREBY IRREVOCABLY AGREES TO (A) IMMEDIATELY DESIGNATE AND
APPOINT A NEW AGENT ACCEPTABLE TO THE HOLDERS OF 51% IN PRINCIPAL AMOUNT OF THE
NOTES TO SERVE IN SUCH CAPACITY AND, IN SUCH EVENT, SUCH NEW AGENT SHALL BE
DEEMED TO BE SUBSTITUTED FOR CAPITOL SERVICES INC. FOR ALL PURPOSES HEREOF AND
(B) PROMPTLY DELIVER TO THE HOLDERS THE WRITTEN CONSENT (IN FORM AND SUBSTANCE
SATISFACTORY TO THE HOLDERS OF 51% IN PRINCIPAL AMOUNT OF THE NOTES) OF SUCH NEW
AGENT AGREEING TO SERVE IN SUCH CAPACITY.
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Section 22.9. Waivers by the Company. THE COMPANY WAIVES (A) THE RIGHT
TO TRIAL BY JURY (WHICH EACH HOLDER OF NOTES HEREBY ALSO WAIVES) IN ANY ACTION,
SUIT, PROCEEDING OR COUNTERCLAIM OF ANY KIND ARISING OUT OF OR RELATED TO THIS
AGREEMENT, ANY SECURITY DOCUMENT OR THE NOTES; (B) PRESENTMENT, DEMAND AND
PROTEST AND NOTICE OF PRESENTMENT, PROTEST, DEFAULT, NON-PAYMENT, INTENT TO
ACCELERATE, ACCELERATION, MATURITY, RELEASE, COMPROMISE, SETTLEMENT, EXTENSION
OR RENEWAL OF ANY OR ALL DOCUMENTS, INSTRUMENTS, AND GUARANTIES AT ANY TIME HELD
BY THE HOLDERS OF NOTES (OR ANY AGENT THEREFOR) ON WHICH THE COMPANY MAY IN ANY
WAY BE LIABLE AND HEREBY RATIFIES AND CONFIRMS WHATEVER THE HOLDERS OF NOTES MAY
DO IN THIS REGARD; AND (C) NOTICE OF ACCEPTANCE HEREOF. THE COMPANY ACKNOWLEDGES
THAT THE FOREGOING WAIVERS ARE A MATERIAL INDUCEMENT TO THE HOLDERS' ENTERING
INTO THIS AGREEMENT AND THAT THE HOLDERS ARE RELYING UPON THE FOREGOING WAIVERS
IN THEIR FUTURE DEALINGS WITH THE COMPANY. THE COMPANY WARRANTS AND REPRESENTS
THAT IT HAS REVIEWED THE FOREGOING WAIVERS WITH ITS LEGAL COUNSEL AND HAS
KNOWINGLY AND VOLUNTARILY WAIVED ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION
WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A
WRITTEN CONSENT TO A TRIAL BY THE COURT.
* * * * *
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The execution hereof by the Purchasers shall constitute a contract
among the Company and the Purchasers for the uses and purposes hereinabove set
forth. This Agreement may be executed in any number of counterparts, each
executed counterpart constituting an original but all together only one
agreement.
Very truly yours,
QUANTA SERVICES, INC.
By
Name:
-------------------------------
Title:
------------------------------
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Accepted as of the first date written above.
[VARIATION]
By
Name:
-------------------------------
Title:
------------------------------
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DEFINED TERMS
As used herein, the following terms have the respective meanings set
forth below or set forth in the Section hereof following such term:
"Additional Notes" is defined in Section 2.4.
"Additional Purchasers" means purchasers of Additional Notes.
"Affiliate" means, at any time, and with respect to any Person, (a) any
other Person that at such time directly or indirectly through one or more
intermediaries Controls, or is Controlled by, or is under common Control with,
such first Person, and (b) any Person beneficially owning or holding, directly
or indirectly, 10% or more of any class of equity interests of the Company or
any Subsidiary or any corporation of which the Company and its Subsidiaries
beneficially own or hold, in the aggregate, directly or indirectly, 10% or more
of any class of equity interests. As used in this definition, "Control" means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise. Unless the context
otherwise clearly requires, any reference to an "Affiliate" is a reference to an
Affiliate of the Company, provided, however, that Enron Capital & Trade
Resources Corp., Joint Energy Development Investment II Limited Partnership and
Utilicorp United, Inc. and their respective Affiliates shall not be deemed to be
Affiliates of the Company. The ownership of Designated Subordinated Debt shall
not be considered for purposes of determining whether any Person is an Affiliate
for purposes of this Agreement.
"Bank Credit Agreement" means the Third Amended and Restated Secured
Credit Agreement between the Company and its Bank Lenders, dated as of June 14,
1999, as amended, restated, refinanced, replaced, increased or reduced from time
to time, and any successor bank credit agreement.
"Bank Lenders" means the banks or other lenders which are from time to
time party to the Bank Credit Agreement.
"Business Day" means (a) for the purposes of Section 8.6 only, any day
other than a Saturday, a Sunday or a day on which commercial banks in New York
City are required or authorized to be closed, and (b) for the purposes of any
other provision of this Agreement, any day other than a Saturday, a Sunday or a
day on which commercial banks in Houston, Texas or New York, New York are
required or authorized to be closed.
"Capital Lease" means, at any time, a lease with respect to which the
lessee is required concurrently to recognize the acquisition of an asset and the
incurrence of a liability in accordance with GAAP.
"Capital Lease Obligation" means, with respect to any Person and a
Capital Lease, the amount of the obligation of such Person as the lessee under
such Capital Lease which would, in accordance with GAAP, appear as a liability
on a balance sheet of such Person.
SCHEDULE B
(to Note Purchase Agreement)
53
"Change in Control" has the meaning set forth in Section 8.7.
"Closing" is defined in Section 3.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and the rules and regulations promulgated thereunder from time to time.
"Collateral" means the personal property of the Company and the
Guarantors described in the Security Documents.
"Collateral Agent" means NationsBank, N.A. d/b/a Bank of America, N.A.,
and any successor collateral agent appointed in accordance with the terms of the
Security Documents.
"Collateral Release Event" shall have the meaning assigned thereto in
Section 2.3.
"Company" means Quanta Services, Inc., a Delaware corporation.
"Competitor" means any Person (including any subsidiary or affiliate
thereof) primarily engaged in contracting and maintenance services relating to
electric, utility, telecommunications or cable television infrastructure in
North America provided, however, that the term "Competitor" shall exclude any
Person which is an Institutional Investor and which, but for this provision
would fall within the definition of "Competitor" solely through holding passive
investments in a Competitor.
"Confidential Information" is defined in Section 20.
"Consolidated Debt" means, as of any date of determination, the total
of all Debt of the Company and its Subsidiaries outstanding on such date, after
eliminating all offsetting debits and credits between the Company and its
Subsidiaries and all other items required to be eliminated in the course of the
preparation of consolidated financial statements of the Company and its
Subsidiaries in accordance with GAAP.
"Consolidated Debt Ratio" means, as of any date of determination, the
ratio of (a) Consolidated Debt as of such date of determination to (b)
Consolidated Proforma Operating Cash Flow for the period of four consecutive
fiscal quarters ending immediately preceding such date of determination. For
purposes of determining the Consolidated Debt Ratio, Consolidated Proforma
Operating Cash Flow shall include the historical financial results of any
"business", as defined in Regulation S-X (17 CFR 210), acquired during such
period of four consecutive fiscal quarters, calculated as if such business
entity had been acquired on the first day of such four quarter fiscal period (to
the extent such results are not already reflected in the consolidated financial
results of the Company and its Subsidiaries), and shall also give effect, on a
pro forma basis, to the incurrence of Debt in connection with the acquisition of
a business and the application of the proceeds thereof, including retirement of
any Debt of such business.
"Consolidated Income Available for Interest Charges" means, with
respect to any period, Consolidated Net Income for such period plus all amounts
deducted in the computation thereof
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on account of (a) all Interest Charges during such period, (b) all taxes imposed
on or measured by income or excess profits during such period, and (c) the total
amount of Management Fees expensed during such period.
"Consolidated Net Income" means, with reference to any period, the net
income (or loss) of the Company and its Subsidiaries for such period (taken as a
cumulative whole), as determined in accordance with GAAP, after eliminating all
offsetting debits and credits between the Company and its Subsidiaries and all
other items required to be eliminated in the course of the preparation of
consolidated financial statements of the Company and its Subsidiaries in
accordance with GAAP.
"Consolidated Net Worth" means the consolidated stockholders' equity of
the Company and its Subsidiaries, as determined in accordance with GAAP, less
the sum of (i) to the extent included in consolidated stockholders' equity, all
amounts properly attributable to minority interests, if any, and (ii) the
aggregate amount of all Restricted Investments in excess of 10% of such
consolidated stockholders' equity.
"Consolidated Proforma Operating Cash Flow" means, in respect of any
period, the sum of (a) Consolidated Net Income for such period, plus (b) to the
extent deducted in the determination of Consolidated Net Income for such period,
(x) all Interest Charges during such period, (y) the total amount of expenses
for depreciation, amortization, income taxes, deferred items and other non-cash
expenses of the Company and its Subsidiaries during such period, and (z) the
total amount of Management Fees expensed during such period.
"Consolidated Total Assets" means, as of any date of determination, the
total amount of all assets of the Company and its Subsidiaries, determined on a
consolidated basis in accordance with GAAP.
"Debt" means, with respect to any Person, without duplication,
(a) its liabilities for borrowed money and its redemption
obligations in respect of mandatorily redeemable Preferred Stock which
is redeemable prior to the maturity of any Note;
(b) its liabilities for the deferred purchase price of
property acquired by such Person (excluding accounts payable and other
accrued liabilities arising in the ordinary course of business but
including, without limitation, all liabilities created or arising under
any conditional sale or other title retention agreement with respect to
any such property);
(c) its Capital Lease Obligations;
(d) all liabilities for borrowed money secured by any Lien
with respect to any property owned by such Person (whether or not it
has assumed or otherwise become liable for such liabilities); and
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(e) Guarantees of such Person with respect to liabilities of a
type described in any of clauses (a) through (d) hereof.
Debt of any Person shall include all obligations of such Person of the
character described in clauses (a) through (e) to the extent such Person remains
legally liable in respect thereof notwithstanding that any such obligation is
deemed to be extinguished under GAAP.
"Default" means an event or condition the occurrence or existence of
which would, with the lapse of time or the giving of notice or both, become an
Event of Default.
"Default Rate" means for any Note that rate of interest that is the
greater of (i) 2% per annum above the rate of interest stated in clause (a) of
the first paragraph of such Note or (ii) 2% over the rate of interest publicly
announced by Bank of America, N.A. in New York, New York as its "base" or
"prime" rate.
"Designated Subordinated Debt" shall mean the Enron Subordinated Debt
and any other Subordinated Debt of the Company or any Subsidiary which has been
designated as "Designated Subordinated Debt" in writing by at least 51% of the
outstanding Notes of each Series (voting as separate classes).
"Domestic Subsidiary" means any Subsidiary organized under the laws of
the United States or any jurisdiction thereof.
"Enron Subordinated Debt" shall mean the Convertible Subordinated Notes
issued by the Company pursuant to the Securities Purchase Agreement dated as of
September 29, 1998, among the Company, Enron Capital & Trade Resources Corp. and
Joint Energy Development Investments II Limited Partnership, as amended from
time to time.
"Environmental Laws" means any and all federal, state, local, and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution and the protection of the
environment or the release of any materials into the environment, including but
not limited to those related to hazardous substances or wastes, air emissions
and discharges to waste or public systems.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the rules and regulations promulgated thereunder
from time to time in effect.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that is treated as a single employer together with the Company
under Section 414 of the Code.
"Event of Default" is defined in Section 11.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
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"Excluded Sale and Leaseback Transaction" shall mean any sale or
transfer of property acquired by the Company or any Subsidiary after the date of
this Agreement to any Person within 180 days following the acquisition or
construction of such property by the Company or any Subsidiary if the Company or
a Subsidiary shall concurrently with such sale or transfer, lease such property,
as lessee.
"Excluded Subsidiary Obligations" means (a) the Guaranty Agreement and
any other Guaranty of Debt of the Company by a Guarantor which shall be a party
to the Guaranty Agreement and (b) obligations of Guarantors as co-obligors with,
or guarantors of, the Company on Debt; provided that each creditor which is a
beneficiary of an Excluded Subsidiary Obligation shall have become a party to
either (i) the Intercreditor Agreement or (ii) an intercreditor agreement
between such beneficiary and the holders of Notes pursuant to which the parties
have agreed to be treated on a pari passu basis with respect to any recovery on
such obligation.
"Fair Market Value" means, at any time and with respect to any
property, the sale value of such property that would be realized in an
arm's-length sale at such time between an informed and willing buyer and an
informed and willing seller (neither being under a compulsion to buy or sell),
as reasonably determined in the good faith opinion of the Company's board of
directors.
"GAAP" means generally accepted accounting principles as in effect from
time to time in the United States of America.
"Governmental Authority" means
(a) the government of
(i) the United States of America or any state or
other political subdivision thereof, or
(ii) any jurisdiction in which the Company or any
Subsidiary conducts all or any part of its business, or which
has jurisdiction over any properties of the Company or any
Subsidiary, or
(b) any entity exercising executive, legislative, judicial,
regulatory or administrative functions of, or pertaining to, any such
government.
"Guarantor" shall mean those certain Subsidiaries of the Company which
shall be a party to a Guaranty Agreement.
"Guaranty" means, with respect to any Person, any obligation (except
the endorsement in the ordinary course of business of negotiable instruments for
deposit or collection) of such Person guaranteeing or in effect guaranteeing any
Debt, dividend or other obligation of any other Person in any manner, whether
directly or indirectly, including (without limitation) obligations incurred
through an agreement, contingent or otherwise, by such Person:
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(a) to purchase such Debt or obligation or any property
constituting security therefor primarily for the purpose of assuring
the owner of such Debt or obligation of the ability of any other Person
to make payment of the Debt or obligation;
(b) to advance or supply funds (i) for the purchase or payment
of such Debt or obligation, or (ii) to maintain any working capital or
other balance sheet condition or any income statement condition of any
other Person or otherwise to advance or make available funds for the
purchase or payment of such Debt or obligation;
(c) to lease properties or to purchase properties or services
primarily for the purpose of assuring the owner of such Debt or
obligation of the ability of any other Person to make payment of the
Debt or obligation; or
(d) otherwise to assure the owner of such Debt or obligation
against loss in respect thereof.
In any computation of the Debt or other liabilities of the obligor under any
Guaranty, the Debt or other obligations that are the subject of such Guaranty
shall be assumed to be direct obligations of such obligor, provided that the
amount of such Debt outstanding for purposes of this Agreement shall not be
exceed the maximum amount of Debt that is the subject of such Guaranty.
"Guaranty Agreement" is defined in Section 2.2.
"Guaranty Release Event" shall have the meaning assigned thereto in
Section 2.2.
"Hazardous Material" means any and all pollutants, toxic or hazardous
wastes or any other substances that might pose a hazard to health or safety, the
removal of which may be required or the generation, manufacture, refining,
production, processing, treatment, storage, handling, transportation, transfer,
use, disposal, release, discharge, spillage, seepage, or filtration of which is
or shall be restricted, prohibited or penalized by any applicable law
(including, without limitation, asbestos, urea formaldehyde foam insulation and
polychlorinated biphenyls).
"holder" means, with respect to any Note, the Person in whose name such
Note is registered in the register maintained by the Company pursuant to Section
13.1.
"Institutional Investor" means (a) any original purchaser of a Note,
(b) any holder of more than $2,000,000 of the aggregate principal amount of the
Notes then outstanding, and (c) any bank, trust company, savings and loan
association or other financial institution, any pension plan, any investment
company, any insurance company, any broker or dealer, or any other similar
financial institution or entity, regardless of legal form.
"Intercreditor Agreement" is defined in Section 2.3.
"Interest Charges" means, with respect to any period, the sum (without
duplication) of the following (in each case, eliminating all offsetting debits
and credits between the Company
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and its Subsidiaries and all other items required to be eliminated in the course
of the preparation of consolidated financial statements of the Company and its
Subsidiaries in accordance with GAAP): (a) all interest in respect of Debt of
the Company and its Subsidiaries (including imputed interest on Capital Lease
Obligations) deducted in determining Consolidated Net Income for such period,
and (b) all debt discount and expense amortized or required to be amortized in
the determination of Consolidated Net Income for such period.
"Interest Charges Coverage Ratio" means, at any time, the ratio of (a)
Consolidated Income Available for Interest Charges for the period of four
consecutive fiscal quarters ending on, or most recently ended prior to, such
time to (b) the sum of (i) all Interest Charges during such period, (ii) the
total amount of the Management Fees paid during such period, and (iii) the total
amount of any dividends or distributions paid or scheduled to be paid in respect
of the Utilicorp Preferred Stock during such period.
"Investments" shall mean all investments, in cash or by delivery of
property made, directly or indirectly in any Person, whether by acquisition of
shares of capital stock, indebtedness or other obligations or securities or by
loan, advance, capital contribution or otherwise.
"Lien" means, with respect to any Person, any mortgage, lien, pledge,
charge, security interest or other encumbrance, or any interest or title of any
vendor, lessor, lender or other secured party to or of such Person under any
conditional sale or other title retention agreement or Capital Lease, upon or
with respect to any property or asset of such Person.
"Make-Whole Amount" shall have the meaning (i) set forth in Section 8.6
with respect to any Series 2000-A Note and (ii) set forth in the applicable
Supplement with respect to any other Series of Notes.
"Management Fee" means the management fee due from the Company to
Utilicorp under the terms of the management services agreement between the
Company and Utilicorp under which Utilicorp will provide to the Company advice
regarding (a) corporate and strategic planning, (b) development, evaluation and
marketing of the Company's products and services, (c) potential acquisition
candidates and business opportunities and (d) other similar and related
services.
"Material" means material in relation to the business, operations,
affairs, financial condition, assets or properties of the Company and its
Subsidiaries taken as a whole.
"Material Adverse Effect" means a material adverse effect on (a) the
business, operations, affairs, financial condition, assets or properties of the
Company and its Subsidiaries taken as a whole, or (b) the ability of the Company
to perform its obligations under this Agreement (including any Supplement) and
the Notes, or (c) the validity or enforceability of this Agreement (including
any Supplement) or the Notes.
"Memorandum" is defined in Section 5.3.
B-7
59
"Multiemployer Plan" means any Plan that is a "multiemployer plan" (as
such term is defined in Section 4001(a)(3) of ERISA).
"Notes" is defined in Section 1.
"Officer's Certificate" means a certificate of a Senior Financial
Officer or of any other officer of the Company whose responsibilities extend to
the subject matter of such certificate.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA or any successor thereto.
"Person" means an individual, partnership, corporation, limited
liability company, association, trust, unincorporated organization, or a
government or agency or political subdivision thereof.
"Plan" means an "employee benefit plan" (as defined in Section 3(3) of
ERISA) that is or, within the preceding five years, has been established or
maintained, or to which contributions are or, within the preceding five years,
have been made or required to be made, by the Company or any ERISA Affiliate or
with respect to which the Company or any ERISA Affiliate may have any liability.
"Pledged Stock" means the capital stock of the Subsidiaries of the
Company pledged pursuant to the Security Documents.
"Preferred Stock" means any class of capital stock of a corporation
that is preferred over any other class of capital stock of such corporation as
to the payment of dividends or the payment of any amount upon liquidation or
dissolution of such corporation.
"Priority Debt" means, without duplication, the sum of (a) all Debt of
the Company or its Subsidiaries secured by a Lien other than Liens permitted by
paragraphs (a) through (k) of Section 10.5 and (b) all unsecured Debt of
Subsidiaries other than (i) Debt owed to the Company or any other Subsidiary and
(ii) unsecured Debt of a Subsidiary existing on the date hereof and listed on
Schedule 5.15 and (iii) Excluded Subsidiary Obligations.
"property" or "properties" means, unless otherwise specifically
limited, real or personal property of any kind, tangible or intangible, choate
or inchoate.
"Purchasers" means the purchasers of the Series 2000-A Notes named in
Schedule A hereto.
"QPAM Exemption" means Prohibited Transaction Class Exemption 84-14
issued by the United States Department of Labor.
"Required Holders" means, at any time, the holders of at least 51% in
principal amount of the Notes at the time outstanding (exclusive of Notes then
owned by the Company or any of its Affiliates).
B-8
60
"Responsible Officer" means any Senior Financial Officer and any other
officer of the Company with responsibility for the administration of the
relevant portion of this Agreement.
"Restricted Investments" shall mean all Investments except any of the
following: (i) property to be used in the ordinary course of business; (ii)
assets arising from the sale of goods and services in the ordinary course of
business; (iii) Investments in one or more Subsidiaries or any Person that
becomes a Subsidiary; (iv) Investments existing at the date of Closing and
reflected in Schedule 5.4; (v) Investments in obligations, maturing within one
year, issued by or guaranteed by the United Sates of America, or an agency
thereof, or Canada, or any province thereof; (vi) Investments in tax-exempt
obligations, maturing within one year, which are rated in one of the top two
rating classifications by at least one national rating agency; (vii) Investments
in bank deposits, certificates of deposit or banker's acceptances maturing
within one year issued by a commercial bank which is rated in one of the top two
rating classifications by at least one national rating agency; (viii)
Investments in commercial paper, maturing within 270 days, rated in one of the
top two rating classifications by at least one national rating agency; (ix)
Investments in repurchase agreements; (x) treasury stock; (xi) Investments in
money market instrument programs which are classified as current assets in
accordance with GAAP; (xii) Investments constituting loans and advances to
employees in the ordinary course of business not exceeding $5,000,000 in the
aggregate; (xiii) Investments received in settlement of litigation or
bankruptcy; (xiv) swap agreements, cap agreements, collar agreements, forward
contracts, options and other similar hedging agreements and arrangements
designed to protect against fluctuations in interest rate and currency exchange
rates which are entered into by the Company and its Subsidiaries in the ordinary
course of business and not as a speculative investment; (xv) prepaid expenses in
the ordinary course of business; and (xvi) deposits for leases, utility services
and workers compensation and similar deposits made in the ordinary course of
business.
"Securities Act" means the Securities Act of 1933, as amended from time
to time.
"Security Documents" means (i) the separate security agreements among
the Collateral Agent and the Company and the Guarantors, (ii) the separate
pledge agreements among the Collateral Agent and the Company and certain
Guarantors, and (iii) the patent collateral assignment between the Collateral
Agent and a Guarantor, whether in existence on the date hereof or hereafter
entered into, in each case as supplemented, amended, modified, renewed and
replaced.
"Senior Financial Officer" means the chief financial officer, principal
accounting officer, treasurer or comptroller of the Company.
"Senior Debt" means, as of the date of any determination thereof, all
Consolidated Debt, other than Subordinated Debt.
"Series" means any series of Notes issued pursuant to this Agreement or
any Supplement hereto.
B-9
61
"Significant Subsidiary" means, at any time, any Subsidiary that
accounts for more than (i) 5% of the consolidated assets of the Company and its
Subsidiaries or (ii) 5% of consolidated revenue of the Company and its
Subsidiaries.
"Significant Subsidiary" shall also mean any two or more Subsidiaries
which in the aggregate account for more than (i) 5% of the consolidated assets
of the Company and its Subsidiaries or (ii) 5% of consolidated revenue of the
Company and its Subsidiaries.
"Subordinated Debt" means, as of the date of any determination thereof,
the Enron Subordinated Debt and all other unsecured Debt of the Company which
shall contain or have applicable thereto subordination provisions providing for
the subordination thereof to other Debt of the Company (including, without
limitation, the Notes).
"Subsidiary" means, as to any Person, any corporation, association or
other business entity in which such Person or one or more of its Subsidiaries or
such Person and one or more of its Subsidiaries owns sufficient equity or voting
interests to enable it or them (as a group) ordinarily, in the absence of
contingencies, to elect a majority of the directors (or Persons performing
similar functions) of such entity, and any partnership or joint venture if more
than a 50% interest in the profits or capital thereof is owned by such Person or
one or more of its Subsidiaries or such Person and one or more of its
Subsidiaries (unless such partnership can and does ordinarily take major
business actions without the prior approval of such Person or one or more of its
Subsidiaries). Unless the context otherwise clearly requires, any reference to a
"Subsidiary" is a reference to a Subsidiary of the Company.
"Supplement" shall have the meaning assigned thereto in Section 2.4.
"Utilicorp" means Utilicorp United, Inc., a Delaware corporation.
"Utilicorp Preferred Stock" means the perpetual preferred stock issued
by the Company to Utilicorp which (a) has a dividend at a 0.5% annual coupon
rate payable for six (6) years after the date of issuance, (b) is convertible
into common stock of the Company at the option of Utilicorp at a conversion
price which is fixed (or the method of its determination is fixed) on the date
issued, (c) is not subject to voluntary redemption by the Company or mandatory
redemption by the Company at the request of Utilicorp, (d) participates with the
Company's common stock in permitted distributions, (e) has voting rights equal
to the number of shares into which it could be converted as of the applicable
record date, (f) has preemptive rights to maintain its proportionate equity
ownership in the Company, and (g) gives the Company the option to pay, defer, or
pay in kind any scheduled dividend.
"Wholly-Owned Subsidiary" means, at any time, any Subsidiary one
hundred percent (100%) of all of the equity interests (except directors'
qualifying shares) and voting interests of which are owned by any one or more of
the Company and the Company's other Wholly-Owned Subsidiaries at such time.
B-10
62
[FORM OF TRANCHE 1 NOTE]
QUANTA SERVICES, INC.
8.46% SERIES 2000-A SENIOR SECURED NOTE, TRANCHE 1, DUE MARCH 1, 2005
No. [______] [Date]
$[__________] PPN [_________]
FOR VALUE RECEIVED, the undersigned, QUANTA SERVICES, INC. (herein
called the "Company"), a corporation organized and existing under the laws of
the State of Delaware, hereby promises to pay to [_____________________] or
registered assigns, the principal sum of [______________] DOLLARS on March 1,
2005 with interest (computed on the basis of a 360-day year of twelve 30-day
months) (a) on the unpaid balance thereof at the rate of 8.46% per annum from
the date hereof, payable semi-annually, on the fifteenth day of January and July
in each year and at maturity, commencing with the January or July next
succeeding the date hereof, until the principal hereof shall have become due and
payable, and (b) to the extent permitted by law on any overdue payment
(including any overdue prepayment) of principal, any overdue payment of interest
and any overdue payment of any Make-Whole Amount (as defined in the Note
Purchase Agreement referred to below), payable semi-annually as aforesaid (or,
at the option of the registered holder hereof, on demand), at a rate per annum
from time to time equal to the greater of (i) 10.46% or (ii) 2% over the rate of
interest publicly announced by Bank of America, N.A. from time to time in New
York, New York as its "base" or "prime" rate.
Payments of principal of, interest on and any Make-Whole Amount with
respect to this Note are to be made in lawful money of the United States of
America at the principal office of Bank of America, N.A. in New York, New York
or at such other place as the Company shall have designated by written notice to
the holder of this Note as provided in the Note Purchase Agreement referred to
below.
This Note is one of a series of Senior Secured Notes (herein called the
"Notes") issued pursuant to the Note Purchase Agreement, dated as of March 1,
2000 (as from time to time amended, supplemented or modified, the "Note Purchase
Agreement"), between the Company and the respective Purchasers named therein and
is entitled to the benefits thereof. Each holder of this Note will be deemed, by
its acceptance hereof, (i) to have agreed to the confidentiality provisions set
forth in Section 20 of the Note Purchase Agreement and (ii) to have made the
representation set forth in Section 6.2 of the Note Purchase Agreement.
This Note is a registered Note and, as provided in the Note Purchase
Agreement, upon surrender of this Note for registration of transfer, duly
endorsed, or accompanied by a written instrument of transfer duly executed, by
the registered holder hereof or such holder's attorney duly authorized in
writing, a new Note for a like principal amount will be issued to, and
registered in the name of, the transferee. Prior to due presentment for
registration of transfer, the Company may treat the person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and
for all other purposes, and the Company will not be affected by any notice to
the contrary.
EXHIBIT 1(a)
(to Note Purchase Agreement)
63
The Company will make required prepayments of principal on the dates
and in the amounts specified in the Note Purchase Agreement. This Note is also
subject to optional prepayment, in whole or from time to time in part, at the
times and on the terms specified in the Note Purchase Agreement, but not
otherwise.
If an Event of Default, as defined in the Note Purchase Agreement,
occurs and is continuing, the principal of this Note may be declared or
otherwise become due and payable in the manner, at the price (including any
applicable Make-Whole Amount) and with the effect provided in the Note Purchase
Agreement.
Pursuant to the Guaranty Agreement dated as of March 1, 2000, certain
subsidiaries of the Company have absolutely and unconditionally guaranteed
payment in full of the principal of, Make-Whole Amount if any, and interest on
this Note and the performance by the Company of all of its obligations contained
in the Note Purchase Agreement all as more fully set forth in said Guaranty
Agreement.
This Note shall be construed and enforced in accordance with, and the
rights of the issuer and holder hereof shall be governed by, the law of the
State of New York excluding choice-of-law principles of the law of such State
that would require the application of the laws of a jurisdiction other than such
State.
QUANTA SERVICES, INC.
By
Name:
-------------------------------
Title:
-------------------------------
E-1(a)-2
64
[FORM OF TRANCHE 2 NOTE]
QUANTA SERVICES, INC.
8.55% SERIES 2000-A SENIOR SECURED NOTE, TRANCHE 2, DUE MARCH 1, 2007
No. [______] [Date]
$[__________] PPN [_________]
FOR VALUE RECEIVED, the undersigned, QUANTA SERVICES, INC. (herein
called the "Company"), a corporation organized and existing under the laws of
the State of Delaware, hereby promises to pay to [_____________________] or
registered assigns, the principal sum of [______________] DOLLARS on March 1,
2007 with interest (computed on the basis of a 360-day year of twelve 30-day
months) (a) on the unpaid balance thereof at the rate of 8.55% per annum from
the date hereof, payable semi-annually, on the fifteenth day of January and July
in each year and at maturity, commencing with the January or July next
succeeding the date hereof, until the principal hereof shall have become due and
payable, and (b) to the extent permitted by law on any overdue payment
(including any overdue prepayment) of principal, any overdue payment of interest
and any overdue payment of any Make-Whole Amount (as defined in the Note
Purchase Agreement referred to below), payable semi-annually as aforesaid (or,
at the option of the registered holder hereof, on demand), at a rate per annum
from time to time equal to the greater of (i) 10.55% or (ii) 2% over the rate of
interest publicly announced by Bank of America, N.A. from time to time in New
York, New York as its "base" or "prime" rate.
Payments of principal of, interest on and any Make-Whole Amount with
respect to this Note are to be made in lawful money of the United States of
America at the principal office of Bank of America, N.A. in New York, New York
or at such other place as the Company shall have designated by written notice to
the holder of this Note as provided in the Note Purchase Agreement referred to
below.
This Note is one of a series of Senior Secured Notes (herein called the
"Notes") issued pursuant to the Note Purchase Agreement, dated as of March 1,
2000 (as from time to time amended, supplemented or modified, the "Note Purchase
Agreement"), between the Company and the respective Purchasers named therein and
is entitled to the benefits thereof. Each holder of this Note will be deemed, by
its acceptance hereof, (i) to have agreed to the confidentiality provisions set
forth in Section 20 of the Note Purchase Agreement and (ii) to have made the
representation set forth in Section 6.2 of the Note Purchase Agreement.
This Note is a registered Note and, as provided in the Note Purchase
Agreement, upon surrender of this Note for registration of transfer, duly
endorsed, or accompanied by a written instrument of transfer duly executed, by
the registered holder hereof or such holder's attorney duly authorized in
writing, a new Note for a like principal amount will be issued to, and
registered in the name of, the transferee. Prior to due presentment for
registration of transfer, the Company may treat the person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and
for all other purposes, and the Company will not be affected by any notice to
the contrary.
EXHIBIT 1(b)
(to Note Purchase Agreement)
65
The Company will make required prepayments of principal on the dates
and in the amounts specified in the Note Purchase Agreement. This Note is also
subject to optional prepayment, in whole or from time to time in part, at the
times and on the terms specified in the Note Purchase Agreement, but not
otherwise.
If an Event of Default, as defined in the Note Purchase Agreement,
occurs and is continuing, the principal of this Note may be declared or
otherwise become due and payable in the manner, at the price (including any
applicable Make-Whole Amount) and with the effect provided in the Note Purchase
Agreement.
Pursuant to the Guaranty Agreement dated as of March 1, 2000, certain
subsidiaries of the Company have absolutely and unconditionally guaranteed
payment in full of the principal of, Make-Whole Amount if any, and interest on
this Note and the performance by the Company of all of its obligations contained
in the Note Purchase Agreement all as more fully set forth in said Guaranty
Agreement.
This Note shall be construed and enforced in accordance with, and the
rights of the issuer and holder hereof shall be governed by, the law of the
State of New York excluding choice-of-law principles of the law of such State
that would require the application of the laws of a jurisdiction other than such
State.
QUANTA SERVICES, INC.
By
Name:
-------------------------------
Title:
-------------------------------
E-1(b)-2
66
[FORM OF TRANCHE 3 NOTE]
QUANTA SERVICES, INC.
8.61% SERIES 2000-A SENIOR SECURED NOTE, TRANCHE 3, DUE MARCH 1, 2010
No. [______] [Date]
$[__________] PPN [_________]
FOR VALUE RECEIVED, the undersigned, QUANTA SERVICES, INC. (herein
called the "Company"), a corporation organized and existing under the laws of
the State of Delaware, hereby promises to pay to [_____________________] or
registered assigns, the principal sum of [______________] DOLLARS on March 1,
2010 with interest (computed on the basis of a 360-day year of twelve 30-day
months) (a) on the unpaid balance thereof at the rate of 8.61% per annum from
the date hereof, payable semi-annually, on the fifteenth day of January and July
in each year and at maturity, commencing with the January or July next
succeeding the date hereof, until the principal hereof shall have become due and
payable, and (b) to the extent permitted by law on any overdue payment
(including any overdue prepayment) of principal, any overdue payment of interest
and any overdue payment of any Make-Whole Amount (as defined in the Note
Purchase Agreement referred to below), payable semi-annually as aforesaid (or,
at the option of the registered holder hereof, on demand), at a rate per annum
from time to time equal to the greater of (i) 10.61% or (ii) 2% over the rate of
interest publicly announced by Bank of America, N.A. from time to time in New
York, New York as its "base" or "prime" rate.
Payments of principal of, interest on and any Make-Whole Amount with
respect to this Note are to be made in lawful money of the United States of
America at the principal office of Bank of America, N.A. in New York, New York
or at such other place as the Company shall have designated by written notice to
the holder of this Note as provided in the Note Purchase Agreement referred to
below.
This Note is one of a series of Senior Secured Notes (herein called the
"Notes") issued pursuant to the Note Purchase Agreement, dated as of March 1,
2000 (as from time to time amended, supplemented or modified, the "Note Purchase
Agreement"), between the Company and the respective Purchasers named therein and
is entitled to the benefits thereof. Each holder of this Note will be deemed, by
its acceptance hereof, (i) to have agreed to the confidentiality provisions set
forth in Section 20 of the Note Purchase Agreement and (ii) to have made the
representation set forth in Section 6.2 of the Note Purchase Agreement.
This Note is a registered Note and, as provided in the Note Purchase
Agreement, upon surrender of this Note for registration of transfer, duly
endorsed, or accompanied by a written instrument of transfer duly executed, by
the registered holder hereof or such holder's attorney duly authorized in
writing, a new Note for a like principal amount will be issued to, and
registered in the name of, the transferee. Prior to due presentment for
registration of transfer, the Company may treat the person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and
for all other purposes, and the Company will not be affected by any notice to
the contrary.
EXHIBIT 1(c)
(to Note Purchase Agreement)
67
The Company will make required prepayments of principal on the dates
and in the amounts specified in the Note Purchase Agreement. This Note is also
subject to optional prepayment, in whole or from time to time in part, at the
times and on the terms specified in the Note Purchase Agreement, but not
otherwise.
If an Event of Default, as defined in the Note Purchase Agreement,
occurs and is continuing, the principal of this Note may be declared or
otherwise become due and payable in the manner, at the price (including any
applicable Make-Whole Amount) and with the effect provided in the Note Purchase
Agreement.
Pursuant to the Guaranty Agreement dated as of March 1, 2000, certain
subsidiaries of the Company have absolutely and unconditionally guaranteed
payment in full of the principal of, Make-Whole Amount if any, and interest on
this Note and the performance by the Company of all of its obligations contained
in the Note Purchase Agreement all as more fully set forth in said Guaranty
Agreement.
This Note shall be construed and enforced in accordance with, and the
rights of the issuer and holder hereof shall be governed by, the law of the
State of New York excluding choice-of-law principles of the law of such State
that would require the application of the laws of a jurisdiction other than such
State.
QUANTA SERVICES, INC.
By
Name:
-------------------------------
Title:
-------------------------------
E-1(c)-2
68
FORM OF OPINION OF GENERAL COUNSEL
TO THE COMPANY
The closing opinion of Brad Eastman, General Counsel to the Company,
which is called for by Section 4.11 of the Note Purchase Agreement, shall be
dated the date of Closing and addressed to the Purchasers, shall be satisfactory
in scope and form to each Purchaser and shall be to the effect that:
1. The Company is a corporation, duly incorporated, validly existing
and in good standing under the laws of its jurisdiction of incorporation, has
the corporate power and the corporate authority to execute and perform the Note
Purchase Agreement and the Security Documents to which the Company is a party
and to issue the Notes and has the full corporate power and the corporate
authority to conduct the activities in which it is now engaged and is duly
licensed or qualified and is in good standing as a foreign corporation in each
jurisdiction in which the character of the properties owned or leased by it or
the nature of the business transacted by it makes such licensing or
qualification necessary except in jurisdictions where the failure to be so
qualified or licensed would not have a material adverse effect on the business
of the Company.
2. Each Subsidiary is a corporation duly organized, validly existing
and in good standing under the laws of its jurisdiction of incorporation, has
the corporate power and the corporate authority to execute and perform the
Guaranty Agreement and the Security Documents to which such Subsidiary is a
party and is duly licensed or qualified and is in good standing in each
jurisdiction in which the character of the properties owned or leased by it or
the nature of the business transacted by it makes such licensing or
qualification necessary except in jurisdictions where the failure to be so
qualified or licensed would not have a material adverse effect on the business
of such Subsidiary. All of the issued and outstanding shares of capital stock of
each such Subsidiary have been duly issued, are fully paid and non-assessable
and are owned by the Company, by one or more Subsidiaries, or by the Company and
one or more Subsidiaries. All such outstanding shares have been duly pledged to
the Collateral Agent as security for the Notes under the Pledge Agreements.
3. The Note Purchase Agreement has been duly authorized by all
necessary corporate action on the part of the Company, has been duly executed
and delivered by the Company and constitutes the legal, valid and binding
contract of the Company enforceable in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent conveyance and similar laws affecting
creditors' rights generally, and general principles of equity (regardless of
whether the application of such principles is considered in a proceeding in
equity or at law).
4. The Series 2000-A Notes have been duly authorized by all necessary
corporate action on the part of the Company, have been duly executed and
delivered by the Company and constitute the legal, valid and binding obligations
of the Company enforceable in accordance with their terms, subject to
bankruptcy, insolvency, fraudulent conveyance and similar laws affecting
creditors' rights generally, and general principles of equity (regardless of
whether the application of such principles is considered in a proceeding in
equity or at law).
EXHIBIT 4.11(a)
(to Note Purchase Agreement)
69
5. The Guaranty Agreement has been duly authorized by all necessary
corporate action on the part of the Guarantors, has been duly executed and
delivered by the Guarantors and constitutes the legal, valid and binding
contract of the Guarantors enforceable in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent conveyance and similar laws affecting
creditors' rights generally, and general principles of equity (regardless of
whether the application of such principles is considered in a proceeding in
equity or at law).
6. Each of the Security Documents has been duly authorized by all
necessary corporate action on the part of the respective obligor thereunder, has
been duly executed and delivered by the respective obligor thereunder and
constitutes the legal, valid and binding contract of the respective obligor
thereunder enforceable in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent conveyance and similar laws affecting creditors' rights
generally, and general principles of equity (regardless of whether the
application of such principles is considered in a proceeding in equity or at
law).
7. The issuance and sale of the Series 2000-A Notes and the execution,
delivery and performance by the Company of the Note Purchase Agreement and the
Security Documents to which it is a party do not violate any provision of any
law or other rule or regulation of any Governmental Authority applicable to the
Company or conflict with or result in any breach of any of the provisions of or
constitute a default under or result in the creation or imposition of any Lien
upon any of the property of the Company pursuant to the provisions of the
Articles of Incorporation or By-laws of the Company or any agreement or other
instrument known to such counsel to which the Company is a party or by which the
Company may be bound.
8. The execution, delivery and performance by each of the Guarantors of
the Guaranty Agreement and the Security Documents to which such Guarantor is a
party do not violate any provision of any law or other rule or regulation of any
Governmental Authority applicable to the Company or conflict with or result in
any breach of any of the provisions of or constitute a default under or result
in the creation or imposition of any Lien upon any of the property of such
Guarantor pursuant to the provisions of the Articles of Incorporation or By-laws
of such Guarantor or any agreement or other instrument known to such counsel to
which such Guarantor is a party or by which such Guarantor may be bound.
9. There are no actions, suits or proceedings pending or, to the
knowledge of such counsel after due inquiry, threatened against or affecting the
Company or any Subsidiary in any court or before any governmental authority or
arbitration board or tribunal which, if adversely determined, would have a
materially adverse effect on the properties, business, prospects, profits or
condition, (financial or otherwise) of the Company and its Subsidiaries or the
ability of the Company to perform its obligations under the Note Purchase
Agreement, the Series 2000-A Notes and the Security Documents or on the
legality, validity or enforceability of the Company's obligations under the Note
Purchase Agreement, the Series 2000-A Notes, or the Security Documents. To the
knowledge of such counsel, neither the Company nor any Subsidiary is in default
with respect to any court or governmental authority, or arbitration board or
tribunal. The opinion of Brad Eastman, Esq., shall cover such other matters
relating to the sale of the Series 2000-A Notes as each Purchaser may reasonably
request. With respect to matters of fact on which such opinion is based, such
counsel shall be entitled to rely on appropriate certificates of public
officials and other officers of the Company.
EXHIBIT 4.11(a)-2
70
FORM OF OPINION OF SPECIAL COUNSEL
TO THE COMPANY
The closing opinion of Akin, Gump, Strauss, Hauer & Feld, L.L.P.,
Special Counsel to the Company, which is called for by Section 4.11 of the Note
Purchase Agreement, shall be dated the date of Closing and addressed to the
Purchasers, shall be satisfactory in scope and form to each Purchaser and shall
be to the effect that:
1. The Company is a corporation, duly incorporated, validly existing
and in good standing under the laws of its jurisdiction of incorporation, has
the corporate power and the corporate authority to execute and perform the Note
Purchase Agreement and to issue the Notes and has the full corporate power and
the corporate authority to conduct the activities in which it is now engaged.
2. The Note Purchase Agreement constitutes the legal, valid and binding
contract of the Company enforceable in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent conveyance and similar laws affecting
creditors' rights generally, and general principles of equity (regardless of
whether the application of such principles is considered in a proceeding in
equity or at law).
3. The Series 2000-A Notes constitute the legal, valid and binding
obligations of the Company enforceable in accordance with their terms, subject
to bankruptcy, insolvency, fraudulent conveyance and similar laws affecting
creditors' rights generally, and general principles of equity (regardless of
whether the application of such principles is considered in a proceeding in
equity or at law).
4. The Guaranty Agreement constitutes the legal, valid and binding
contract of the Guarantors enforceable in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent conveyance and similar laws affecting
creditors' rights generally, and general principles of equity (regardless of
whether the application of such principles is considered in a proceeding in
equity or at law).
5. Each of the Security Documents constitutes the legal, valid and
binding contract of the respective obligor thereunder enforceable in accordance
with its terms, subject to bankruptcy, insolvency, fraudulent conveyance and
similar laws affecting creditors' rights generally, and general principles of
equity (regardless of whether the application of such principles is considered
in a proceeding in equity or at law).
6. Other than financing statements which have been filed, no approval,
consent or withholding of objection on the part of, or filing, registration or
qualification with, any governmental body, Federal or state, is necessary in
connection with the execution and delivery of the Note Purchase Agreement, the
Series 2000-A Notes, the Security Documents or the Guaranty Agreement.
EXHIBIT 4.11(b)
(to Note Purchase Agreement)
71
7. The issuance, sale and delivery of the Series 2000-A Notes and the
execution and delivery of the Security Documents and the Guaranty Agreement
under the circumstances contemplated by the Note Purchase Agreement do not,
under existing law, require the registration of the Series 2000-A Notes, the
Security Documents or the Guaranty Agreement under the Securities Act of 1933,
as amended, or the qualification of an indenture under the Trust Indenture Act
of 1939, as amended.
8. Neither the issuance of the Series 2000-A Notes nor the application
of the proceeds of the sale of the Notes will violate or result in a violation
of Section 7 of the Securities Exchange Act of 1934, as amended, or any
regulation issued pursuant thereto, including, without limitation, Regulation T,
U or X of the Board of Governors of the Federal Reserve System.
9. The Company is not an "investment company" or a company "controlled"
by an "investment company", within the meaning of the Investment Company Act of
1940, as amended.
The opinion of Akin, Gump, Strauss, Hauer & Feld, L.L.P., shall cover
such other matters relating to the sale of the Series 2000-A Notes as each
Purchaser may reasonably request. With respect to matters of fact on which such
opinion is based, such counsel shall be entitled to rely on appropriate
certificates of public officials and other officers of the Company.
EXHIBIT 4.11(b)-2
72
FORM OF OPINION OF SPECIAL COUNSEL
TO THE PURCHASERS
The closing opinion of Chapman and Cutler, special counsel to the
Purchasers, called for by Section 4.11 of the Note Purchase Agreement, shall be
dated the date of Closing and addressed to each Purchaser, shall be satisfactory
in form and substance to each Purchaser and shall be to the effect that:
1. The Company is a corporation, validly existing and in good standing
under the laws of its jurisdiction of incorporation and has the corporate power
and the corporate authority to execute and deliver the Note Purchase Agreement
and to issue the Series 2000-A Notes.
2. The Note Purchase Agreement has been duly authorized by all
necessary corporate action on the part of the Company, has been duly executed
and delivered by the Company and constitutes the legal, valid and binding
contract of the Company enforceable in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent conveyance and similar laws affecting
creditors' rights generally, and general principles of equity (regardless of
whether the application of such principles is considered in a proceeding in
equity or at law).
3. The Series 2000-A Notes have been duly authorized by all necessary
corporate action on the part of the Company, and the Notes being delivered on
the date hereof have been duly executed and delivered by the Company and
constitute the legal, valid and binding obligations of the Company enforceable
in accordance with their terms, subject to bankruptcy, insolvency, fraudulent
conveyance and similar laws affecting creditors' rights generally, and general
principles of equity (regardless of whether the application of such principles
is considered in a proceeding in equity or at law).
4. The issuance, sale and delivery of the Series 2000-A Notes under the
circumstances contemplated by the Note Purchase Agreement do not, under existing
law, require the registration of the Series 2000-A Notes under the Securities
Act of 1933, as amended, or the qualification of an indenture under the Trust
Indenture Act of 1939, as amended.
The opinion of Chapman and Cutler shall also state that the opinions of
Brad Eastman, Esq., general counsel to the Company, and Akin, Gump, Strauss,
Hauer & Field, LLP, special Counsel to the Company, are satisfactory in scope
and form to Chapman and Cutler and that, in their opinion, the Purchasers are
justified in relying thereon. With respect to matters of fact upon which such
opinion is based, Chapman and Cutler may rely on appropriate certificates of
public officials and officers of the Company and upon representations of the
Company and the Purchasers delivered in connection with the issuance and sale of
the Series 2000-A Notes.
EXHIBIT 4.11(c)-1
73
In rendering the opinion set forth in paragraph 1 above, Chapman and
Cutler may rely, as to matters referred to in paragraph 1, solely upon an
examination of the Articles of Incorporation certified by, and a certificate of
good standing of the Company from, the Secretary of State of the State of
Delaware, the Bylaws of the Company and the general business corporation law of
the State of Delaware. The opinion of Chapman and Cutler is limited to the laws
of the State of New York, the general business corporation law of the State of
Delaware and the Federal laws of the United States.
EXHIBIT 4.11(c)-2
74
================================================================================
QUANTA SERVICES, INC.
[NUMBER] SUPPLEMENT TO NOTE PURCHASE AGREEMENT
Dated as of ______________________
Re: $____________ _____% Series _______ Senior Secured Notes
DUE _____________________
================================================================================
EXHIBIT S
(to Note Purchase Agreement)
75
QUANTA SERVICES, INC.
1360 Post Oak Boulevard, Suite 2100
Houston, Texas 77056-3023
Dated as of ___________, 20__
To the Purchaser(s) named in
Schedule A hereto
Ladies and Gentlemen:
This [Number] Supplement to Note Purchase Agreement (the "Supplement")
is between QUANTA SERVICES, INC., a Delaware (the "Company"), and the
institutional investors named on Schedule A attached hereto (the "Purchasers").
Reference is hereby made to that certain Note Purchase Agreement dated
as of March 1, 2000 (the "Note Purchase Agreement") between the Company and the
purchasers listed on Schedule A thereto. All capitalized terms not otherwise
defined herein shall have the same meaning as specified in the Note Purchase
Agreement. Reference is further made to Section 4.18 of the Note Purchase
Agreement which requires that, prior to the delivery of any Additional Notes,
the Company and each Additional Purchaser shall execute and deliver a
Supplement.
The Company hereby agrees with the Purchaser(s) as follows:
1. The Company has authorized the issue and sale of $__________
aggregate principal amount of its _____% Series ______ Senior Secured Notes due
_________, ____ (the "Series ______ Notes"). The Series ____ Notes, together
with the Series 2000-A Notes [and the Series ____ Notes] initially issued
pursuant to the Note Purchase Agreement and each series of Additional Notes
which may from time to time hereafter be issued pursuant to the provisions of
Section 2.4 of the Note Purchase Agreement, are collectively referred to as the
"Notes" (such term shall also include any such notes issued in substitution
therefor pursuant to Section 13 of the Note Purchase Agreement). The Series
_____ Notes shall be substantially in the form set out in Exhibit 1 hereto with
such changes therefrom, if any, as may be approved by the Purchaser(s) and the
Company.
2. Subject to the terms and conditions hereof and as set forth in the
Note Purchase Agreement and on the basis of the representations and warranties
hereinafter set forth, the Company agrees to issue and sell to each Purchaser,
and each Purchaser agrees to purchase from the Company, Series _____ Notes in
the principal amount set forth opposite such Purchaser's name on Schedule A
hereto at a price of 100% of the principal amount thereof on the closing date
hereafter mentioned.
76
3. The sale and purchase of the Series ______ Notes to be purchased by
each Purchaser shall occur at the offices of [Chapman and Cutler, 111 West
Monroe Street, Chicago, Illinois 60603,] at 10:00 A.M. Chicago time, at a
closing (the "Closing") on ______, ____ or on such other Business Day thereafter
on or prior to _______, ____ as may be agreed upon by the Company and the
Purchasers. At the Closing, the Company will deliver to each Purchaser the
Series ______ Notes to be purchased by such Purchaser in the form of a single
Series ______ Note (or such greater number of Series ______ Notes in
denominations of at least $100,000 as such Purchaser may request) dated the date
of the Closing and registered in such Purchaser's name (or in the name of such
Purchaser's nominee), against delivery by such Purchaser to the Company or its
order of immediately available funds in the amount of the purchase price
therefor by wire transfer of immediately available funds for the account of the
Company to account number [__________________________] at ____________ Bank,
[Insert Bank address, ABA number for wire transfers, and any other relevant wire
transfer information]. If, at the Closing, the Company shall fail to tender such
Series ______ Notes to any Purchaser as provided above in this Section 3, or any
of the conditions specified in Section 4 shall not have been fulfilled to any
Purchaser's satisfaction, such Purchaser shall, at such Purchaser's election, be
relieved of all further obligations under this Agreement, without thereby
waiving any rights such Purchaser may have by reason of such failure or such
nonfulfillment.
4. The obligation of each Purchaser to purchase and pay for the Series
______ Notes to be sold to such Purchaser at the Closing is subject to the
fulfillment to such Purchaser's satisfaction, prior to the Closing, of the
conditions set forth in Section 4 of the Note Purchase Agreement with respect to
the Series ______ Notes to be purchased at the Closing, and to the following
additional conditions:
(a) Except as supplemented, amended or superceded by the
representations and warranties set forth in Exhibit A hereto, each of
the representations and warranties of the Company set forth in Section
5 of the Note Purchase Agreement shall be correct as of the date of
Closing and the Company shall have delivered to each Purchaser an
Officer's Certificate, dated the date of the Closing certifying that
such condition has been fulfilled.
(b) Contemporaneously with the Closing, the Company shall sell
to each Purchaser, and each Purchaser shall purchase, the Series ______
Notes to be purchased by such Purchaser at the Closing as specified in
Schedule A.
5. [Here insert special provisions for Series 2000-A Notes including
prepayment provisions applicable to Series ______ Notes (including Make-Whole
Amount) and closing conditions applicable to Series ______ Notes].
6. Each Purchaser represents and warrants that the representations and
warranties set forth in Section 6 of the Note Purchase Agreement are true and
correct on the date hereof with respect to the purchase of the Series ______
Notes by such Purchaser.
7. The Company and each Purchaser agree to be bound by and comply with
the terms and provisions of the Note Purchase Agreement as fully and completely
as if such Purchaser were an original signatory to the Note Purchase Agreement.
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77
The execution hereof shall constitute a contract between the Company
and the Purchaser(s) for the uses and purposes hereinabove set forth, and this
agreement may be executed in any number of counterparts, each executed
counterpart constituting an original but all together only one agreement.
QUANTA SERVICES, INC.
By
------------------------------------
Name:
-------------------------------
Title:
-------------------------------
Accepted as of __________, _____
[VARIATION]
By
------------------------------------
Name:
-------------------------------
Title:
-------------------------------
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78
INFORMATION RELATING TO PURCHASERS
PRINCIPAL
NAME AND ADDRESS OF PURCHASER AMOUNT OF SERIES
______ NOTES TO
[NAME OF PURCHASER] BE PURCHASED $
(1) All payments by wire transfer of
immediately available funds to:
with sufficient information to identify the
source and application of such funds.
(2) All notices of payments and written
confirmations of such wire transfers:
(3) All other communications:
SCHEDULE A
(to Supplement)
79
SUPPLEMENTAL REPRESENTATIONS
The Company represents and warrants to each Purchaser that except as
hereinafter set forth in this Exhibit A, each of the representations and
warranties set forth in Section 5 of the Note Purchase Agreement is true and
correct as of the date hereof with respect to the Series ______ Notes with the
same force and effect as if each reference to "Series 2000-A Notes" set forth
therein was modified to refer the "Series ______ Notes" and each reference to
"this Agreement" therein was modified to refer to the Note Purchase Agreement as
supplemented by the _______ Supplement. The Section references hereinafter set
forth correspond to the similar sections of the Note Purchase Agreement which
are supplemented hereby:
Section 5.3. Disclosure. The Company, through its agent, Banc of
America Securities LLC, has delivered to each Purchaser a copy of a Private
Placement Memorandum, dated ____________ (the "Memorandum"), relating to the
transactions contemplated by the ______ Supplement. The Note Purchase Agreement,
the Memorandum, the documents, certificates or other writings delivered to each
Purchaser by or on behalf of the Company in connection with the transactions
contemplated by the Note Purchase Agreement and the _______ Supplement and the
financial statements listed in Schedule 5.5 to the _____ Supplement, taken as a
whole, do not contain any untrue statement of a material fact or omit to state
any material fact necessary to make the statements therein not misleading in
light of the circumstances under which they were made. Since ____________, there
has been no change in the financial condition, operations, business, properties
or prospects of the Company or any Subsidiary except changes that individually
or in the aggregate could not reasonably be expected to have a Material Adverse
Effect.
Section 5.4. Organization and Ownership of Shares of Subsidiaries. (a)
Schedule 5.4 to the ______ Supplement contains (except as noted therein)
complete and correct lists of the Company's Subsidiaries, and showing, as to
each Subsidiary, the correct name thereof, the jurisdiction of its organization,
and the percentage of shares of each class of its capital stock or similar
equity interests outstanding owned by the Company and each other Subsidiary.
Section 5.13. Private Offering by the Company. Neither the Company nor
anyone acting on its behalf has offered the Series A Notes or any similar
securities for sale to, or solicited any offer to buy any of the same from, or
otherwise approached or negotiated in respect thereof with, any Person other
than the Purchasers and not more than [_] other Institutional Investors, each of
which has been offered the Series ______ Notes at a private sale for investment.
Neither the Company nor anyone acting on its behalf has taken, or will take, any
action that would subject the issuance or sale of the Notes to the registration
requirements of Section 5 of the Securities Act.
Section 5.14. Use of Proceeds; Margin Regulations. The Company will
apply the proceeds of the sale of the Series ______ Notes to
______________________________ and for general corporate purposes. No part of
the proceeds from the sale of the Series ______ Notes pursuant to the _____
Supplement will be used, directly or indirectly, for the purpose of buying or
carrying any margin stock within the meaning of Regulation U of the Board of
Governors of
EXHIBIT A
(to Supplement)
80
the Federal Reserve System (12 CFR 222), or for the purpose of buying or
carrying or trading in any securities under such circumstances as to involve the
Company in a violation of Regulation X of said Board (12 CFR 224) or to involve
any broker or dealer in a violation of Regulation T of said Board (12 CFR 220).
As used in this Section, the terms "margin stock" and "purpose of buying or
carrying" shall have the meanings assigned to them in said Regulation U.
Section 5.15. Existing Debt; Future Liens. (a) Schedule 5.15 to the
_________ Supplement sets forth a complete and correct list of all outstanding
Debt of the Company and its Subsidiaries as of _____________, since which date
there has been no Material change in the amounts, interest rates, sinking funds,
installment payments or maturities of the Debt of the Company or its
Subsidiaries. Neither the Company nor any Subsidiary is in default and no waiver
of default is currently in effect, in the payment of any principal or interest
on any Debt of the Company or such Subsidiary and no event or condition exists
with respect to any Debt of the Company or any Subsidiary that would permit (or
that with notice or the lapse of time, or both, would permit) one or more
Persons to cause such Debt to become due and payable before its stated maturity
or before its regularly scheduled dates of payment.
[Add any additional Sections as appropriate at the time the Series
______ Notes are issued]
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81
[FORM OF SERIES ______ NOTE]
QUANTA SERVICES, INC.
___% SERIES ______ SENIOR NOTE DUE ______________
No. [_________] [Date]
$[____________] PPN [____________]
FOR VALUE RECEIVED, the undersigned, QUANTA SERVICES, INC. (herein
called the "Company"), a corporation organized and existing under the laws of
the State of ____________, hereby promises to pay to [________________], or
registered assigns, the principal sum of [________________] DOLLARS on
_______________, with interest (computed on the basis of a 360-day year of
twelve 30-day months) (a) on the unpaid balance thereof at the rate of ____% per
annum from the date hereof, payable semiannually, on the _____ day of ______ and
______ in each year, commencing on the first of such dates after the date
hereof, until the principal hereof shall have become due and payable, and (b) to
the extent permitted by law on any overdue payment (including any overdue
prepayment) of principal, any overdue payment of interest and any overdue
payment of any Make-Whole Amount (as defined in the Note Purchase Agreement
referred to below), payable semiannually as aforesaid (or, at the option of the
registered holder hereof, on demand), at a rate per annum from time to time
equal to the greater of (i) [coupon + 2%]% or (ii) 2% over the rate of interest
publicly announced by _________________ from time to time in
____________________ as its "base" or "prime" rate.
Payments of principal of, interest on and any Make-Whole Amount with
respect to this Note are to be made in lawful money of the United States of
America at ______________________, in ______________________, or at such other
place as the Company shall have designated by written notice to the holder of
this Note as provided in the Note Purchase Agreement referred to below.
This Note is one of a series of Senior Notes (the "Notes") issued
pursuant to a Supplement to the Note Purchase Agreement dated as of March 1,
2000 (as from time to time amended, supplemented or modified, the "Note Purchase
Agreement"), between the Company, the Purchasers named therein and Additional
Purchasers of Notes from time to time issued pursuant to any Supplement to the
Note Purchase Agreement. This Note and the holder hereof are entitled equally
and ratably with the holders of all other Notes of all series from time to time
outstanding under the Note Purchase Agreement to all the benefits provided for
thereby or referred to therein. Each holder of this Note will be deemed, by its
acceptance hereof, to have made the representation set forth in Section 6.2 of
the Note Purchase Agreement, provided that such holder may (in reliance upon
information provided by the Company, which shall not be unreasonably withheld)
make a representation to the effect that the purchase by such holder of any Note
will not constitute a non-exempt prohibited transaction under Section 406(a) of
ERISA.
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82
This Note is registered with the Company and, as provided in the Note
Purchase Agreement, upon surrender of this Note for registration of transfer,
duly endorsed, or accompanied by a written instrument of transfer duly executed,
by the registered holder hereof or such holder's attorney duly authorized in
writing, a new Note of the same series for a like principal amount will be
issued to, and registered in the name of, the transferee. Prior to due
presentment for registration of transfer, the Company may treat the person in
whose name this Note is registered as the owner hereof for the purpose of
receiving payment and for all other purposes, and the Company will not be
affected by any notice to the contrary.
[The Company will make required prepayments of principal on the dates
and in the amounts specified in the Note Purchase Agreement.] [This Note is not
subject to regularly scheduled prepayments of principal.] This Note is [also]
subject to optional prepayment, in whole or from time to time in part, at the
times and on the terms specified in the Note Purchase Agreement, but not
otherwise.
If an Event of Default, as defined in the Note Purchase Agreement,
occurs and is continuing, the principal of this Note may be declared or
otherwise become due and payable in the manner, at the price (including any
applicable Make-Whole Amount) and with the effect provided in the Note Purchase
Agreement.
This Note shall be construed and enforced in accordance with, and the
rights of the parties shall be governed by, the law of the State of __________
excluding choice-of-law principles of the law of such State that would require
the application of the laws of a jurisdiction other than such State.
QUANTA SERVICES, INC.
By
Name:
-------------------------------
Title:
-------------------------------
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