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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Form 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): September 22, 1994
MANVILLE CORPORATION
(Exact name of registrant as specified in its charter)
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<S> <C> <C>
DELAWARE 1-8247 84-0856796
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
717 17TH STREET
DENVER, COLORADO 80202
(Address of principal executive offices) (Zip Code)
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Registrant's telephone number, including area code: (303) 978-2000
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ITEM 5. OTHER EVENTS.
1. Bonds Repurchase
Please refer to the attached press release of Manville Corporation (the
"Company") dated September 22, 1994 regarding the Bonds Repurchase
Agreement dated September 22, 1994 between the Company and Manville
Personal Injury Settlement Trust and the transactions contemplated in
connection therewith.
2. Debt Offering of Schuller International Group, Inc.
Please refer to the attached press release of Schuller International
Group, Inc., a wholly owned subsidiary of the Company ("Schuller"),
dated October 3, 1994 regarding the filing of a Registration Statement
on Form S-1 (No. 33-84600) by Schuller with respect to the proposed
public debt offering of Schuller's % Senior Notes due 2004, by
Manville Personal Injury Settlement Trust, as selling securityholder.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
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(a) and (b). None.
(c). 10(a) Bonds Repurchase Agreement dated September 22, 1994 between the Company and
Manville Personal Injury Settlement Trust.
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2
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
MANVILLE CORPORATION
By: /s/ RICHARD B. VON WALD
Name: Richard B. Von Wald
Title: Senior Vice President,
General Counsel and Secretary
Dated: October 5, 1994
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ITEM 5.1.
Contact: Sharon Sweet
(303) 978-4694
John Cummings
(303) 978-4914
MANVILLE PREPAYS MOST OF TRUST BOND
OBLIGATION WITH SCHULLER NOTES
Denver, Colo. (September 22, 1994) -- Manville Corporation today announced that
it is prepaying substantially all of its bond obligations to the Manville
Personal Injury Settlement Trust (Trust) with an aggregate principal amount of
$379 million of 10 3/8 percent Senior Notes due 2004 of its wholly owned
subsidiary, Schuller International Group, Inc. The aggregate principal amount
and interest rate of these Notes are subject to adjustment if the Trust sells at
least $100 million of the Notes in the public market within six months. If the
Trust does not sell at least $100 million of these Notes in the public markets
within two years, under certain circumstances the interest rate will be adjusted
downward.
"We're pleased to prepay the Manville bonds with Schuller debt, which has more
flexible covenants than were in place and bears a lower estimated cost than
would Manville debt," said Tom Stephens, Manville chairman.
The transaction will result in an extraordinary loss on the early extinguishment
of debt of approximately $25 million, or 20 cents per share, because the $343
million carrying value of the Manville bond being repaid was determined by
discounting the cash flow payments at a 13 percent rate. The principal amount of
the Schuller Notes amount was determined by discounting the Manville bond cash
flows at a negotiated interest rate.
Manville's sole remaining bond obligation to the Trust was carried on its June
30, 1994 balance sheet at about $13 million. The bond obligation requires
payments of $75 million per year in 2013 and 2014.
Manville Corporation (NYSE: MVL) is a holding company with two principal
subsidiaries -- wholly owned Schuller International, and 81.5 percent owned
Riverwood International Corporation (NYSE: RVW). Products sold by Schuller
International include insulation for buildings and equipment, roofing systems,
reinforcements, and filtration. Riverwood International is a global paperboard,
packaging and packaging machinery company. Founded in 1858, Manville Corporation
and its subsidiaries employ approximately 16,000 people at more than 50
locations worldwide. Manville and its subsidiaries had approximately $3.6
billion in assets as of December 31, 1993.
MANVILLE CORPORATION
P.O. Box 5108 - Denver, CO 80217-5108
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ITEM 5.2
(SCHULLER LOGO)
NEWS
RELEASE Leaders in Insulation, Reinforcements,
Filtration and Building Products
Contact: Sharon Sweet
(303) 978-4694
SCHULLER INTERNATIONAL FILES FOR SALE OF $250 MILLION IN SENIOR NOTES
DENVER, COLO. (October 3, 1994) -- Schuller International Group, Inc. today
announced that it has filed a Form S-1 Registration Statement with the
Securities and Exchange Commission relating to a proposed sale of $250 million
of senior notes due 2004. The sale will be made by Manville Personal Injury
Settlement Trust (Trust) as the selling securityholder. These Notes are a
portion of the $379 million of Senior Notes received by the Trust on September
22, 1994, in exchange for previously existing Manville obligations. The Company
will receive no proceeds from the sale.
Schuller International is a leading manufacturer of insulation and building
products, with 1993 sales of $1.16 billion. Schuller produces and markets
insulation products for buildings and equipment, commercial roofing systems,
high-efficiency air filtration media, and fibers and nonwoven mats used as
reinforcements in buildings and industrial applications. Schuller employs
approximately 7,400 people and operates 35 manufacturing facilities in the
United States, Canada and Germany. Schuller International is a wholly owned
subsidiary of Manville Corporation (NYSE-MVL). Both are headquartered in Denver,
Colo.
SCHULLER INTERNATIONAL, INC.
P.O. Box 5108
Denver, CO 80217-5108
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EXHIBIT INDEX
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EXHIBIT NO. EXHIBIT DESCRIPTION PAGE
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10(a) Bonds Repurchase Agreement dated September 22, 1994 between
the Company and Manville Personal Injury Settlement Trust.
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EXHIBIT 10(a)
BONDS REPURCHASE AGREEMENT
AGREEMENT dated September 22, 1994 between Manville
Corporation, a Delaware corporation (the "Company"), and Manville Personal
Injury Settlement Trust (the "Trust").
WHEREAS, the Trust was created pursuant to a Trust Agreement
dated as of November 28, 1988 to which the Company is a party (as amended, the
"Trust Agreement") to implement those provisions of the Second Amended and
Restated Plan of Reorganization of the Company and certain affiliated
corporations (the "Manville Plan") that relate to the settlement and payment of
asbestos-related health claims against the Company and such affiliated
corporations; and
WHEREAS, pursuant to the Manville Plan, the Company
contributed certain assets to the Trust's estate, including the Original Bond
(such term and other capitalized terms used but not defined in these recitals
having the meanings ascribed to them in Article I hereof); and
WHEREAS, the purposes of the Trust as set forth in the Trust
Agreement include enhancing the Trust estate and using the assets in the Trust
estate to deliver fair, adequate and equitable compensation to bona fide
beneficiaries of the Trust; and
WHEREAS, in furtherance of the Trust's purposes and the
objectives of the Manville Plan and to further the long-term objectives of the
Company, the Trust and the Company entered into the Bond Prepayment Agreement,
pursuant to which the Company and the Trust agreed to monetize a portion of the
Original Bond in connection with a public offering of debt and equity by one of
the Company's principal subsidiaries, Riverwood International Corporation
("RIC"), by partially prepaying the Original Bond with (i) $150 million in cash
proceeds from such public offering (less certain underwriting expenses
attributable thereto), (ii) $100 million principal amount of RIC notes
substantially identical to those sold in such public offering, which notes were
subsequently sold by the Trust in a public secondary offering pursuant to
registration rights provided in the Bond Prepayment Agreement, and (iii) a new
Bond in a reduced amount; and
WHEREAS, in furtherance of the Trust's purposes and the
objectives of the Manville Plan and to further the long-term objectives of the
Company, the Company is willing, subject to the terms and conditions of this
Agreement, to repurchase the Bond and
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the remainder of the Original Bond with marketable notes of the Company's other
principal subsidiary, Schuller International Group, Inc., a Delaware
corporation ("Schuller"), which the Trust may sell to third parties pursuant to
the registration rights and other provisions of this Agreement; and the Trust
is willing, subject to the terms and conditions of this Agreement, to surrender
the Bond and the Original Bond for cancellation in consideration of its receipt
of such Schuller Repurchase Notes.
NOW, THEREFORE, in consideration of the mutual covenants
herein contained and other good and valuable consideration, the adequacy and
receipt of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Terms Defined. The following terms used
herein have the meanings ascribed to them in this Article I.
"Additional Principal Amount" is defined in Section
2.03(b)(vii).
"Adjusted Market Rate" means the annual interest rate at which
Schuller Repurchase Notes are being sold by the Trust in a first Offering at a
price equal to 100% of their face amount (without giving effect to any discount
or premium, including discounts payable to Underwriters, Placement Agents or
other underwriters, brokers or dealers); as such annual interest rate is
determined in accordance with Section 2.03(b)(i).
"Adjusted Repurchase Amount" means the sum of (i) the
aggregate Current Net Present Value of the Bond and the Original Bond as of the
Repurchase Date, as determined in accordance with Section 5.01(b) using the
Adjusted Market Rate in determining the Applicable Discount Rate; plus (ii) the
August 1994 Payment Amount; plus (iii) if the Second Bond Repurchase Date has
occurred on or prior to the consummation of the first Offering by the Trust,
the Current Net Present Value of the Second Bond as of the Second Bond
Repurchase Date, as determined in accordance with Section 5.01(b) using the
Adjusted Market Rate in determining the Applicable Discount Rate.
"Adjusted Repurchase and Interest Amount" means the sum of (i)
the Adjusted Repurchase Amount, (ii) the amount equal to
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the interest that would have accrued at the Adjusted Market Rate on Schuller
Notes with a principal amount equal to the sum of the Current Net Present Value
of the Bond and the Original Bond as of the Repurchase Date (determined in
accordance with Section 5.01(b) using the Adjusted Market Rate in determining
the Applicable Discount Rate) plus the August 1994 Payment Amount for the
period from and including the Repurchase Date to but excluding the consummation
date of the first Offering by the Trust, and (iii) if the Second Bond
Repurchase Date has occurred, the amount equal to the interest that would have
accrued at the Adjusted Market Rate on Schuller Notes with a principal amount
equal to the Current Net Present Value of the Second Bond as of the Second Bond
Repurchase Date (determined in accordance with Section 5.01(b) using the
Adjusted Market Rate in determining the Applicable Discount Rate) for the
period from and including the Second Bond Repurchase Date to but excluding the
consummation date of the first Offering by the Trust.
"Adjusted Schuller Notes" means senior notes of Schuller
issued under the Amended and Restated Indenture, which shall bear interest (i)
at the Adjusted Market Rate instead of the Initial Market Rate, (ii) accruing
from and including the consummation date of the first Offering by the Trust and
(iii) payable commencing (unless otherwise agreed by the Company and the Trust)
on the date that is the first to occur of the first day or the fifteenth day of
a calendar month after the six-month anniversary of such consummation date and
on each six-month anniversary of such initial payment date.
"Adjustment Period" means the period of time commencing on the
entry into effect of the Indenture and ending on the first interest payment
date provided for under the Indenture (without giving effect to the Indenture
Supplement), which first interest payment date shall not be earlier than the
six-month anniversary of the Repurchase Date.
"Affiliate" means, with respect to any Person, any other
Person that, directly or indirectly, controls or is controlled by, or is under
common control with, such specified Person. For the purposes of this
definition, "control" (including the correlative meanings, the terms
"controlling", "controlled by" and "under common control with"), as used with
respect to any Person, means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of such
specified Person whether through the ownership of voting securities, by
contract or otherwise.
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"Amended and Restated Indenture" means the amendment and
restatement of the Indenture referred to in Section 1(e) of the Indenture
Supplement.
"Applicable Discount Rate" means the Market Rate plus 87.5
basis points.
"August 1994 Payment Amount" means the sum of (i) $20,680,534
plus (ii) interest accrued on the amount specified in clause (i) at the rate of
4.70% per annum (computed on the basis of a year of 360 days and the actual
number of days elapsed) for the period from and including August 31, 1994 to
but excluding the Repurchase Date (it being understood that, if the Repurchase
Date shall not have occurred on or prior to September 30, 1994 and the August
31, 1994 Payment Amount under the Bond shall not have been paid in full on or
prior to September 30, 1994, the terms of the Bond Prepayment Agreement and of
a certain letter agreement dated August 31, 1994 between the Company and the
Trust with respect to such Payment Amount shall apply to such unpaid amount).
"Bond" means the Manville Corporation Bond due March 31, 2013,
dated August 25, 1993, which was issued to the Trust by the Company pursuant to
the Bond Prepayment Agreement and which currently provides for twice-annual
payments to the Trust of $20,680,534 through the year 2012, except in the years
2001 and 2002.
"Bond Prepayment Agreement" means the Bond Prepayment
Agreement dated as of August 25, 1993 between the Company and the Trust, as
modified for a limited period of time by the letter agreement of even date
therewith between the Company and the Trust and as amended and supplemented by
a letter agreement dated March 31, 1994 between the Company and the Trust
clarifying certain provisions thereof.
"Bonds" means, collectively, the Bond and the Original Bond.
"Business Day" means any day except a Saturday, Sunday or
other day on which commercial banks in New York, New York are authorized or
required by law to close.
"Commission" means the Securities and Exchange Commission.
"Company" is defined in the heading of this Agreement.
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"Company Adjustment Notes" is defined in Section 2.03(b)(vi).
"Current Net Present Value" of the Bond, the Original Bond or
the Second Bond as of any date means the sum of the unpaid Payment Amounts on
such bond as of such date, each discounted to present value as of such date at
the Applicable Discount Rate in accordance with Section 5.01(b); it being
understood that the Payment Amount on the Bond due on August 31, 1994 shall not
be included in the Current Net Present Value of the Bond.
"Debt" of any Person means, as of any date, without
duplication, (i) all obligations of such Person for borrowed money, (ii) all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments, (iii) all obligations of such Person to pay the deferred
purchase price of property or services (whether or not the recourse of the
vendor is to the whole of the assets of such Person or only a portion thereof),
except trade accounts payable arising in the ordinary course of business which
are not overdue by more than 90 days (unless being contested in good faith),
(iv) all obligations of such Person as lessee under capital leases, (v) all
indebtedness of others secured by a Lien on any asset of such Person, whether
or not such indebtedness is assumed by such Person, (vi) all indebtedness of
others guaranteed by such Person and (vii) all obligations of such Person to
reimburse any other Person in respect of amounts paid under letters of credit,
bankers' acceptances or similar instruments.
"Demand Note" means the promissory note of Schuller in the
form attached as Exhibit A hereto.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
"GAAP" means U.S. generally accepted accounting principles as
in effect from time to time.
"Governmental Agency" means any domestic, foreign,
supranational, national, federal, state, regional or local government and any
department, bureau, agency, authority, commission, board, court, tribunal, or
other legislative, executive, judicial, regulatory or administrative body or
instrumentality of any such government or any official empowered to act on
behalf of any of the foregoing, or any arbitral tribunal acting within the
proper scope of its jurisdiction.
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"Indemnified Party" is defined in Section 2.04(f)(iii).
"Indemnifying Party" is defined in Section 2.04(f)(iii).
"Indemnitee" is defined in Section 2.06(f)(iii).
"Indemnitor" is defined in Section 2.06(f)(iii).
"Indenture" means the Indenture between Schuller and the
Indenture Trustee relating to the Schuller Notes, in the form set forth in
Exhibit B-1 hereto, and any amendments, supplements, restatements or
modifications thereof or supplemental indentures relating thereto (including,
without limitation, the Indenture Supplement (unless expressly stated to the
contrary herein) and the Amended and Restated Indenture).
"Indenture Supplement" means Indenture Supplement No. 1
between Schuller and the Indenture Trustee to be entered into simultaneously
with the Indenture, in the form set forth in Exhibit B-2 hereto.
"Indenture Trustee" means the entity serving as the trustee
under the Indenture from time to time.
"Independent" means, when used with respect to any specified
Person, a Person who (a) is in fact independent, (b) does not have any direct
financial interest or any material indirect financial interest in the Trust,
the PD Trust, the Company, Schuller or any Affiliate of the Company or Schuller
and (c) is not connected with the Company, Schuller, any Affiliate of the
Company or Schuller, the Trust or the PD Trust as an officer, employee,
promoter, underwriter or person performing similar functions.
"Initial Market Rate" means 10.375% per annum.
"Initial Repurchase Amount" means the sum of (i) the aggregate
Current Net Present Value of the Bond and the Original Bond as of the
Repurchase Date, as determined in accordance with Section 5.01(b) using the
Initial Market Rate in determining the Applicable Discount Rate, plus (ii) the
August 1994 Payment Amount.
"Inspectors" is defined in Section 2.04(d)(x).
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset.
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"Manville Plan" is defined in the recitals to this Agreement.
"Market Rate" means the Initial Market Rate or the Adjusted
Market Rate, as the context requires.
"Offering" means a sale by the Trust of an aggregate principal
amount of at least $100 million of Schuller Repurchase Notes in either (i) a
firm commitment, underwritten Securities Act registered public secondary
offering with a minimum of four (4) purchasers who are Independent of the
Trust; or (ii) an arm's length transaction to a minimum of four (4) financial
institutions or other Persons each of which in the normal course of business,
as it has theretofore been conducted, invests in fixed income securities and at
the time are holding at least $100 million in book value of such securities or
cash (including short-term marketable securities and cash equivalents).
"Officer's Certificate" means, with respect to any Person, a
certificate signed by the Chairman of the Board of Directors, the President,
the Senior Vice President and General Counsel, any Senior Vice President with
senior financial responsibility, any Vice President with senior financial
responsibility, the Controller or the Treasurer of such Person.
"Original Bond" means the Manville Personal Injury Settlement
Trust Bond due March 31, 2013 which was partially prepaid pursuant to the Bond
Prepayment Agreement and the outstanding principal amount of which prior to the
Repurchase consists of twice-annual payments due in the years 2001 and 2002 in
the aggregate amount of $150,000,000.
"Payment Amount" means (i) in respect of the Bond,
$20,680,534, and (ii) in respect of the Original Bond or the Second Bond,
$37,500,000.
"Payment Date" means, in respect of the Original Bond, the
Bond or the Second Bond, each date on which a payment is due in accordance with
the terms thereof.
"PD Trust" means the Manville Property Damage Settlement Trust
created pursuant to the Manville Plan by the Manville Property Damage
Settlement Trust Agreement dated as of November 28, 1988 among the Trustors
named therein and the PD Trustees named therein.
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"Person" means any individual, corporation, partnership, joint
venture, association, trust, unincorporated organization or government or any
agency or political subdivision thereof, including any Governmental Agency.
"Placement Agents" means each and every placement agent for a
private placement of any Schuller Repurchase Notes in accordance with Section
2.06 hereof, as selected by the Trust; and the term "Placement Agent" means any
one of them.
"Records" is defined in Section 2.04(d)(x).
"Related Agreements" means the Indenture, the Indenture
Supplement, the Amended and Restated Indenture, the Schuller Notes, the Demand
Note, the agreements referred to in Sections 2.01(d) and 2.01(e), the Second
Amendment to the Supplemental Agreement and the Seventh Amendment to the Trust
Agreement.
"Representatives" is defined in Section 2.06(a)(viii).
"Repurchase" means the consummation on the Repurchase Date of
the Company's repurchase of the Bond and the Original Bond with Schuller Notes,
as described in Section 2.02.
"Repurchase Date" means September 22, 1994, subject to
postponement in accordance with Section 2.02(b).
"RIC" is defined in the recitals to this Agreement.
"SCB" means the Selected Counsel for the Beneficiaries
appointed pursuant to the Manville Plan.
"Schuller" is defined in the recitals to this Agreement.
"Schuller Excess Notes" means those Schuller Notes
representing the difference (if any) between the aggregate principal amount of
all Schuller Notes and the aggregate principal amount of the Schuller
Repurchase Notes, and includes any Trust Adjustment Notes transferred by the
Trust to the Company pursuant to Section 2.03(b)(vi) and excludes any Company
Adjustment Notes transferred by the Company to the Trust pursuant to Section
2.03(b)(vi).
"Schuller Notes" means the Senior Notes due 2004 of Schuller
bearing the annual interest rate initially determined in accordance with
Section 2.01(a) and subject to adjustment in accordance with Section 2.03 and
having the other terms described in Exhibits B-1 and B-2 hereto, with only such
modifications or
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changes thereto, or such further or other terms, as may be expressly approved
in advance by the Trust and the Company in writing; and such term includes the
Schuller Repurchase Notes, the Schuller Excess Notes, the Adjusted Schuller
Notes, the Supplemental Schuller Notes and the senior notes issued under the
Indenture pursuant to Section 6.01(d).
"Schuller Recapitalization" is defined in Section 2.01(c).
"Schuller Repurchase Notes" means those outstanding Schuller
Notes which are to be transferred and/or which have been transferred to the
Trust by the Company in accordance with this Agreement, including (i) as the
consideration for the Company's repurchase of the Bond, the Original Bond and
(subject to terms of Section 6.01) the Second Bond and (ii) in connection with
the Trust's payment of its Interim Interest to the Company pursuant to Section
2.03(b)(vi); and such term includes any Company Adjustment Notes transferred to
the Trust by the Company pursuant to Section 2.03(b)(vi) and excludes any Trust
Adjustment Notes transferred to the Company by the Trust pursuant to Section
2.03(b)(vi).
"Second Amendment to the Supplemental Agreement" means the
Second Amendment to the Amended and Restated Supplemental Agreement, in the
form attached as Exhibit C hereto.
"Second Bond" means the Manville Settlement Trusts Second Bond
due March 31, 2015.
"Second Bond Repurchase Amount" means (i) if the Second Bond
Repurchase Date occurs before the consummation date of the first Offering by
the Trust, the Current Net Present Value of the Second Bond as of the Second
Bond Repurchase Date as determined in accordance with Section 5.01(b) using the
Initial Market Rate in determining the Applicable Discount Rate; or (ii) if the
Second Bond Repurchase Date occurs after the consummation date of the first
Offering by the Trust, the Current Net Present Value of the Second Bond as of
the Second Bond Repurchase Date as determined in accordance with Section
5.01(b) using the Adjusted Market Rate in determining the Applicable Discount
Rate.
"Second Bond Repurchase Date" is defined in Section 6.01(a).
"Second Bond Repurchase Notes" is defined in Section 6.01(a).
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"Second Bond Reserve Amount" is defined in Section 2.03(b)(ii).
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder.
"Seventh Amendment to the Trust Agreement" means the Seventh
Amendment to Manville Personal Injury Settlement Trust Agreement, in the form
attached as Exhibit D hereto.
"Shelf Registration" is defined in Section 2.04(a).
"Subsidiary" means, with respect to any Person, any
corporation or other entity of which securities or other ownership interest
having ordinary voting power to elect a majority of the board of directors or
other Persons performing similar functions are at the time directly or
indirectly owned by such Person.
"Supplemental Schuller Notes" is defined in Section
2.03(b)(vii).
"TIA" means the Trust Indenture Act of 1939, as amended, or
any successor statute thereto, and the rules and regulations promulgated
thereunder.
"Trust" is defined in the heading of this Agreement.
"Trust Adjustment Notes" is defined in Section 2.03(b)(vi).
"Trust Agreement" is defined in the recitals to this Agreement.
"Trustees" means each of the individuals serving from time to
time as trustees of the Trust.
"Underwriters" means the underwriters (as such term is defined
in the Securities Act) of any public offering of Schuller Repurchase Notes
pursuant to Section 2.04 hereof, as selected by the Trust; and the term
"Underwriter" means any one of them.
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ARTICLE II
REPURCHASE OF THE BONDS
SECTION 2.01. Preliminary Actions. Prior to the Repurchase,
the parties shall take (and the Company shall cause Schuller to take) the
following actions:
(a) Determination of Initial Market Rate. The Company and
the Trust, in consultation with two nationally recognized investment banking
firms, one selected by the Trust and one selected by the Company, have agreed
on the Initial Market Rate as the lowest annual interest rate at which $100
million aggregate principal amount of Schuller Repurchase Notes can be sold by
the Trust as of the time such determination is being made in a firm commitment,
underwritten Securities Act registered public secondary offering with at least
four purchasers at a price equal to 100% of their face amount (without giving
effect to any discount or premium, including discounts payable to Underwriters,
Placement Agents or other underwriters, brokers or dealers).
(b) Entry into Indenture. The Company shall cause Schuller
to enter into the Indenture and the Indenture Supplement with The Bank of New
York, as Indenture Trustee, or such other indenture trustee as shall be
reasonably acceptable to the Trust. Until the Repurchase, the Company shall
not cause or permit the Indenture (including the Indenture Supplement) to be
cancelled, terminated, modified, amended, supplemented, restated or otherwise
changed, nor shall it cause or permit any consent or waiver to be granted
thereunder until after the Repurchase, without the prior written consent of the
Trust. The Indenture shall provide for the initial issuance of Schuller Notes
bearing interest at the Initial Market Rate.
(c) Issuance of Schuller Notes; Schuller Recapitalization.
The Company shall cause Schuller to issue $400 million principal amount of
Schuller Notes to the Company under the Indenture, which Schuller Notes shall
bear interest at the Initial Market Rate. Such issuance shall be in
consummation of a recapitalization of Schuller (the "Schuller
Recapitalization") pursuant to which Schuller shall issue $400 million
principal amount of Schuller Notes and the $25 million Demand Note to the
Company as a dividend on the common stock of Schuller held by the Company.
(d) Execution of Certain Intercompany Agreements. The
Company shall enter into, and shall cause Schuller to enter into, the following
agreements, each of which will become effective no later than as of the
Repurchase:
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(i) an intercompany agreement, in the form attached as Exhibit
E hereto;
(ii) a treasury management agreement, in the form attached as
Exhibit F hereto;
(iii) a tax sharing agreement, in the form attached as Exhibit
G hereto; and
(iv) a corporate agreement, in the form attached as Exhibit H
hereto.
(e) Execution of Agreement with the Trust.
Contemporaneously with its execution and delivery of the agreement referred to
in Section 2.01(d)(iv), the Company shall enter into an agreement with the
Trust in the form attached as Exhibit I hereto.
(f) Seventh Amendment to the Trust Agreement.
Contemporaneously with the execution of this Agreement, the Company and the
Trust shall execute and deliver the Seventh Amendment to the Trust Agreement.
The effectiveness of the Seventh Amendment to the Trust Agreement shall be
subject to obtaining the concurrence thereto of the SCB.
(g) Second Amendment to the Supplemental Agreement.
Contemporaneously with the execution of this Agreement, the Company and the
Trust shall execute and deliver the Second Amendment to the Supplemental
Agreement. The effectiveness of the Second Amendment to the Supplemental
Agreement shall be subject to obtaining the concurrence thereto of the SCB.
SECTION 2.02. Repurchase of Bonds with Schuller Notes. (a)
Subject to the terms and conditions set forth in this Agreement, on the
Repurchase Date the Company shall repurchase the Bonds in whole by transferring
to the Trust Schuller Notes obtained by it in accordance with Section 2.01(c)
in an aggregate principal amount equal to the Initial Repurchase Amount. On
the Repurchase Date, the Company shall deliver to the Trust said Schuller
Notes, duly endorsed for transfer to the Trust in accordance with the terms of
the Indenture and free and clear of all Liens and adverse claims, together with
the other documents referred to in Section 3.04, and the Trust shall deliver
the Bonds free and clear of all Liens and adverse claims (other than any
remainderman or reversionary interests of the Company or the PD Trust and any
Liens or claims created by, or arising in favor of, the Company) to the Company
for cancellation, together with the other documents referred to in Section
3.03.
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(b) Either party shall have the right, exercisable one or
more times by written notice to the other party given not less than two (2)
Business Days prior to the date then specified as the Repurchase Date, to
postpone the Repurchase Date to a date no later than September 30, 1994. In
the event of any such postponement, the term "Repurchase Date" as used in this
Agreement shall refer to the latest date so specified by either of the parties,
and this Agreement shall remain in full force and effect. If the Repurchase
shall not have occurred on or prior to September 30, 1994, either party hereto
shall have the right, at any time thereafter, without liability or obligation
to the other party, to terminate this Agreement by giving written notice of
such termination to the other party; provided, however, that such termination
shall not affect the Company's obligations under that certain letter agreement
dated August 31, 1994 between the Company and the Trust relating to the Payment
Amount due on August 31, 1994 under the Bond. Such termination shall be
effective upon the other party's receipt of such notice of termination.
SECTION 2.03. Certain Provisions Relating to the First
Offering by the Trust. (a) No First Offering Within Two Years. (i) Subject
to the other terms of this Section 2.03(a), if the Trust shall fail to
consummate a first Offering on or prior to the two-year anniversary of the
Repurchase Date (the "Second Anniversary"), the interest rate on all Schuller
Notes shall be reduced by 50 basis points on the Second Anniversary and by a
further 50 basis points on each six-month anniversary of the Second
Anniversary; provided, however, that in no event shall such interest rate be
reduced by a total of more than 200 basis points below the Initial Market Rate.
To accomplish the foregoing, if the Trust shall not have consummated a first
Offering on or prior to the Second Anniversary, the Company and the Trust shall
(unless this Section 2.03(a)(i) does not then apply pursuant to the terms of
Section 2.03(a)(ii) or (iii)) execute and deliver to the Indenture Trustee,
within five Business Days after the Second Anniversary, a joint certificate
designated as an Interest Modification Notice delivered under Section 6 of the
Indenture Supplement (an "Interest Modification Notice") stating that,
effective as of the Second Anniversary (which shall be specified therein as the
"Modification Effective Date"), the interest rate on the Schuller Notes shall
be the rate specified in such notice as the "Modified Interest Rate," which
rate shall be the Initial Market Rate less 50 basis points; and within five
Business Days after each six-month anniversary of the Second Anniversary until
the earlier of (x) such time (if any) as this Section 2.03(a)(i) no longer
applies pursuant to Section 2.03(a)(ii) or (iii), or (y) such time as the
interest rate on the Schuller Notes has been reduced by an
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aggregate of 200 basis points below the Initial Market Rate, the Company and
the Trust shall execute and deliver to the Indenture Trustee a further Interest
Modification Notice stating that, effective as of such six-month anniversary
(which shall be specified therein as the "Modification Effective Date"), the
interest rate on the Schuller Notes shall be the rate specified in such notice
as the "Modified Interest Rate," which rate shall be the interest rate on the
Schuller Notes in effect on the date immediately preceding such six-month
anniversary less 50 basis points (provided, however, that no rate shall be so
specified which is more than 200 basis points below the Initial Market Rate).
(ii) If, at any time after the Second Anniversary either (A) a
first Offering is consummated by the Trust, (B) Schuller debt securities are
sold for an aggregate purchase price of at least $100 million in one or more
transactions of the type described in clause (i) and (ii) of the definition of
the term "Offering" (other than notes evidencing secured loans (or unsecured
loans with terms of five years or less) to Schuller by commercial banks under
bank credit agreements), or (C) Schuller shall become subject to the
requirements of a reporting company under the Exchange Act with respect to any
of its debt securities, then the terms of Section 2.03(a)(i) shall no longer
apply and the interest rate on all Schuller Notes shall be readjusted to equal
the Initial Market Rate, effective as of the interest payment date immediately
preceding the date (the "Occurrence Date") of the occurrence of any of the
events referred to in clauses (A) through (C) above. Within five Business Days
after the Occurrence Date, the Company and the Trust shall execute and deliver
to the Indenture Trustee a further Interest Modification Notice stating that,
effective as of the interest payment date immediately preceding the Occurrence
Date (which shall be specified therein as the "Modification Effective Date"),
the interest rate on the Schuller Notes shall be the rate specified in such
notice as the "Modified Interest Rate," which rate shall be the Initial Market
Rate. Notwithstanding the foregoing, in order to give effect to the agreement
between the Company and the Trust that such interest rate readjustment be
deemed to be effective, as to the Trust, as of the Occurrence Date, the Trust
shall pay to the Company the amount equal to the difference between (i) the
interest payable on the Schuller Repurchase Notes held by the Trust with
respect to the period commencing on the interest payment date immediately
preceding the Occurrence Date and ending on the Occurrence Date, calculated at
the Initial Market Rate, and (ii) the interest payable on such Schuller
Repurchase Notes, with respect to the same period, calculated at the rate in
effect prior to such interest rate readjustment; such payment to be made
subject to, and within two Business Days following, Schuller's payment of the
interest due and
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payable at the Initial Market Rate on the Schuller Notes on the next succeeding
interest payment date after the readjustment, with respect to the full period
since the immediately preceding interest payment date.
(iii) Section 2.03(a)(i) shall not apply if
(1) during the two year period following the Repurchase Date,
Schuller shall become subject to the requirements of a reporting
company under the Exchange Act with respect to any of its debt
securities, or Schuller debt securities are sold for an aggregate
purchase price of at least $100 million in one or more transactions of
the types described in clause (i) and (ii) of the definition of the
term "Offering" (other than notes evidencing secured loans (or
unsecured loans with terms of five years or less) to Schuller by
commercial banks under bank credit agreements); or
(2) the Company has failed to perform, or has failed to cause
Schuller to perform, in a timely fashion so as to permit the
consummation of an Offering within such two year period, any of its
obligations under the second sentence of Section 2.02(a), Section
2.03(b), Sections 2.04 through 2.07 or Section 2.09, as applicable to
such Offering; or
(3) the Trust, within 15 months after the Repurchase Date,
makes a written request pursuant to Section 2.04(a), (b) or (c)(i)
with respect to a first Offering but the Commission or any other
Governmental Agency fails to declare effective the registration
statement with respect to such Offering or takes action (or inaction)
which, in either case, prevents the consummation of such Offering
during such two year period provided, that such failure, action or
inaction by the Commission or such other Governmental Agency does not
result from the Trust's express and intentional cancellation of such
Offering or does not otherwise result directly and primarily from
action taken by the Trust with respect to such Offering); or
(4) the Trust, prior to February 1, 1995, makes a written
request pursuant to Section 2.04(a), (b) or (c)(i) or Section 2.06(a)
with respect to a first Offering and following such request a
Determination is made during the Offering Period upon the Trust's
request therefor to the Company in writing, which Determination is to
the effect that such Offering is an Unmarketable Transaction. If such
a Determination that the Offering is an Unmarketable Transaction is
made, the Company may, prior to the third anniversary of the
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Repurchase Date, make up to (but not more than) two requests to the
Trust in writing seeking another Determination as to whether an
Offering would be an Unmarketable Transaction at such time. If,
following such a request by the Company, a Determination is made that
an Offering would not be an Unmarketable Transaction at such time, and
if the Trust shall not consummate a first Offering within two years
after such Determination, then the terms of Section 2.03(a)(i) shall
(subject to this Section 2.03(a)(iii) and Section 2.03(a)(ii)) apply;
provided, however, that in applying the terms of Section 2.03(a)(i)
and the other terms of this Section 2.03(a) for purposes of this
sentence, references to the Second Anniversary shall be replaced with
references to the two-year anniversary of the Determination that an
Offering would not be an Unmarketable Transaction and references to
the Repurchase Date in Section 2.03(a)(iii) shall be replaced with
references to the date of such Determination; provided, further, that,
in applying the terms of this clause (4) for purposes of this
sentence: (A) if the Trust, within 60 days after such Determination
that an Offering would not be an Unmarketable Transaction, makes a
written request pursuant to Section 2.04(a), (b) or (c)(i) or Section
2.06(a) with respect to a first Offering, then the interest rate on
the Schuller Notes shall not be reduced (and the Company may not
request any further Determinations) in the event that the pricing
obtained by the Trust for such Offering qualifies the Offering as an
Unmarketable Transaction; and (B) if the Trust does not, within 60
days after such Determination that an Offering would not be an
Unmarketable Transaction, make a written request pursuant to Section
2.04(a), (b), (c)(i) or Section 2.06 with respect to a first Offering,
then the Trust shall not have the right to request any further
Determinations and this clause (4) shall have no further application.
For purposes of this clause (4):
Offering Period means the period of time after a registration
statement is filed under the Securities Act and the Commission
comments or takes other action (or, after one month, does not take any
action) with respect to such registration statement (or, in the case
of a private placement, after an offering memorandum is prepared), but
prior to the consummation of an Offering.
Determination means a determination made by mutual agreement by two
nationally recognized investment banking firms, one selected by the
Company and one selected by the Trust, upon the written request of
either the Company or the Trust that a
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proposed offering would or would not be an Unmarketable Transaction;
provided, however, that if such investment banking firms do not agree
on the determination of such matter within ten Business Days, then
such determination shall be made by a third Independent nationally
recognized investment banking firm in accordance with Section 5.02.
Index means the Merrill Lynch Global Bond Indexes -- High Yield Master
Index, as reported by Bloomberg Financial Markets, expressed in terms
of annual yield to maturity, or if such index is no longer computed or
is no longer publicly available, then such other high yield U.S.
corporate debt index as shall be mutually acceptable to the Company
and the Trust.
Imputed Market Rate, for purposes of a Determination, means the Initial
Market Rate plus the increase (or minus the decrease) in the Index
from the close of business on the Repurchase Date to the close of
business on the date prior to the date on which such Determination is
made.
Minimum Price, with respect to Schuller Repurchase Notes being offered
in an Offering, means the price that results in an effective annual
yield to maturity on such Schuller Repurchase Notes equal to the
Imputed Market Rate plus 150 basis points (without giving effect to
any discount or premium, including discounts payable to Underwriters,
Placement Agents or other underwriters, brokers or dealers).
Unmarketable Transaction means an Offering in which the Schuller
Repurchase Notes that are being sold or distributed cannot be sold or
distributed in such Offering (using marketing activities that do not
differ in any significant or material respect from those which are
customary for offerings of such size and type) at a price equal to or
greater than the Minimum Price without an agreement by the Trust,
directly or indirectly, to any of the matters referred to in clauses
(A) through (D) of Section 2.03(b)(i), or any other agreement by the
Trust which (i) is not usual and customary for offerings of such size
and type and (ii) would have a material adverse effect on the Trust.
(b) First Offering Consummated Within Adjustment Period. If
a first Offering is to be consummated by the Trust within the Adjustment
Period, the interest rate, record dates and interest payment dates for all
Schuller Notes and the principal amount of the Schuller Repurchase Notes and
the Schuller Excess Notes shall be adjusted as follows:
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<PAGE> 18
(i) The Trust shall cause its Underwriters or
Placement Agents for such first Offering to determine the Adjusted
Market Rate in their pricing procedures for such Offering and to
notify the Trust and the Company of the Adjusted Market Rate in
writing within one Business Day of such determination. In connection
with the determination of the Adjusted Market Rate in the pricing of a
first Offering to be consummated within the Adjustment Period, the
Trust shall not agree, directly or indirectly, with the purchasers
(other than the Underwriters or Placement Agents) of the Schuller
Repurchase Notes to be sold by the Trust in such Offering to (A) any
disposition of, any limitation or restriction on the disposition of,
or any modification to, any of the Trust's other interests in Schuller
or the Company, (B) repurchase or in any manner guarantee, secure or
provide for the payment of principal, premium, if any, or interest on
such Schuller Repurchase Notes, (C) make any payments or other
distributions of property to the purchasers (other than the
Underwriters or Placement Agents) of such Schuller Repurchase Notes or
(D) make any other agreement that directly or indirectly induces such
purchasers to purchase such Schuller Repurchase Notes, other than
representations, warranties and related indemnities customarily given
by sellers of corporate debt securities in secondary transactions.
(ii) If the Adjusted Market Rate differs from the
Initial Market Rate, then within one Business Day of the Trust's
receipt of notice of the Adjusted Market Rate in accordance with
paragraph (i) above, the Trust shall determine and notify the Company
of the Adjusted Repurchase Amount and the Adjusted Repurchase and
Interest Amount in accordance with Section 5.01. If the Second Bond
Repurchase Date has not occurred on or prior to the date on which
notice of the Adjusted Market Rate is given in accordance with
paragraph (i) above, then (A) unless the Company and the Trust shall
otherwise agree in writing, the Company shall obtain, if necessary,
and reserve for transfer to the Trust Schuller Notes in a principal
amount sufficient to repurchase the Second Bond in accordance with
Section 6.01 assuming that the Second Bond Repurchase Date were the
last day of the Adjustment Period (the "Second Bond Reserve Amount");
and (B) either the Trust or the Company shall have the right,
exercisable by notice given to the other party within one Business Day
of its receipt of notice of the Adjusted Market Rate in accordance
with paragraph (i) above, to require that the Second Bond Reserve
Amount be included in the determination of the Additional Principal
Amount in accordance with paragraph (vii) below.
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<PAGE> 19
(iii) Within one Business Day of the Company's or
the Trust's receipt of either notice referred to in paragraph (ii)
above, the Company and the Trust shall jointly execute and shall cause
to be delivered to the Indenture Trustee the Adjustment Notice (as
defined in the Indenture Supplement) and shall designate therein (to
the extent applicable): (A) the consummation date for the first
Offering by the Trust, which shall be designated therein as the
"Adjustment Date," (B) the Adjusted Market Rate (if different from the
Initial Market Rate), which shall be designated therein as the
"Adjusted Interest Rate," (C) the interest payment dates applicable to
the Adjusted Schuller Notes, which shall be determined in accordance
with the definition set forth in Section 1.01 hereof of the term
"Adjusted Schuller Notes" (the first interest payment date provided
for in such definition shall be designated in the Adjustment Notice as
the "Adjusted First Interest Payment Date" and the subsequent interest
payment dates provided for in such definition shall be designated in
the Adjustment Notice as the "Adjusted Interest Payment Dates"); (D)
the record dates applicable to the Adjusted Schuller Notes, which
shall be designated in the Adjustment Notice as the "Adjusted Record
Dates" and shall be (x) the fifteenth day (whether or not a Business
Day, as defined in the Indenture) of the calendar month immediately
preceding the Adjusted First Interest Payment Date and immediately
preceding each Adjusted Interest Payment Date if such dates as
designated pursuant to clause (C) are the first day of a calendar
month or (y) the first day (whether or not a Business Day, as defined
in the Indenture) of the calendar month in which the Adjusted First
Interest Payment Date and each Adjusted Interest Payment Date occur if
such dates as designated pursuant to clause (C) are the fifteenth day
of a calendar month; and (E) the Additional Principal Amount, if any
is required in accordance with paragraph (vii) below.
(iv) If an Adjustment Notice is required to be given
to the Indenture Trustee pursuant to paragraph (iii) above, then,
prior to the consummation of such first Offering, the Company shall
cause the Amended and Restated Indenture to be entered into by
Schuller and the Indenture Trustee in accordance with the terms of
Section 1(e) of the Indenture Supplement.
(v) If an Adjustment Notice is required to be given
to the Indenture Trustee pursuant to paragraph (iii) above, then, at a
closing to be held on the consummation date of the first Offering by
the Trust, but prior to the consummation of
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such first Offering, each of the Company and the Trust shall surrender
to the Indenture Trustee all of its Schuller Notes and shall instruct
and cause the Indenture Trustee, in accordance with the terms of the
Indenture Supplement, (A) to pay to such party the Interim Interest
(as defined in the Indenture Supplement) that is payable on such
Schuller Notes, (B) to cancel such Schuller Notes, and (C) to issue to
such party in exchange therefor Adjusted Schuller Notes under the
Amended and Restated Indenture in the same aggregate principal amount
as the Schuller Notes surrendered by such party (such aggregate
principal amount to include, in the case of the Company, the
Additional Principal Amount (if any) in accordance with the terms of
the Indenture Supplement).
(vi) The parties agree that the appropriate party
will transfer to the other party such number of the Adjusted Schuller
Notes issued to it under the Amended and Restated Indenture as is
necessary so that prior to the consummation of the first Offering the
Trust has received in exchange for the Bonds (and the Second Bond, in
the event that the Second Bond Repurchase Date has occurred) Adjusted
Schuller Notes in an aggregate principal amount equal to the Adjusted
Repurchase Amount. The parties further agree that the Trust will pay
over to the Company the Interim Interest received by the Trust and the
Company will transfer to the Trust an additional number of Adjusted
Schuller Notes in an aggregate principal amount equal to the amount of
interest that would have accrued on Schuller Notes in the aggregate
principal amount equal to the Adjusted Repurchase Amount in accordance
with clauses (ii) and (iii) of the definition of the term "Adjusted
Repurchase and Interest Amount." In order to accomplish the foregoing
terms of this paragraph (vi) in a single transaction, the parties
hereby agree as follows:
(1) If the Adjusted Repurchase and Interest Amount
set forth in the Trust's notice pursuant to paragraph (ii)
above exceeds the principal amount of the Adjusted Schuller
Notes to be received by the Trust pursuant to paragraph (v)
above, the Company shall instruct the Indenture Trustee, in
accordance with clause (v)(C) above, to issue the Adjusted
Schuller Notes to be received by the Company in two or more
certificates, one of which shall represent Adjusted Schuller
Notes (the "Company Adjustment Notes") in an aggregate
principal amount equal to the amount of such excess, which
amount shall be rounded to the nearest $1,000 if necessary.
If the principal amount of the Adjusted Schuller Notes to be
received by the Trust pursuant to paragraph (v) above
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exceeds the Adjusted Repurchase and Interest Amount, the Trust
shall instruct the Indenture Trustee, in accordance with
clause (v)(C) above, to issue the Adjusted Schuller Notes to
be received by the Trust in two or more certificates, one of
which shall represent Adjusted Schuller Notes (the "Trust
Adjustment Notes") in an aggregate principal amount equal to
the amount of such excess, which amount shall be rounded to
the nearest $1,000 if necessary.
(2) At a closing which shall be held on the
consummation date of the first Offering, after the closing
referred to in paragraph (v) above but prior to the
consummation of such first Offering, (A) if there are Company
Adjustment Notes, the Company shall deliver them to the Trust
duly endorsed for transfer to the Trust and (B) if there are
Trust Adjustment Notes, the Trust shall deliver them to the
Company duly endorsed for transfer to the Company; and each
party agrees to do so, in either case, free and clear of all
Liens and adverse claims.
(3) Within two Business Days after the consummation
date of the first Offering, the Trust shall pay to the Company
the amount that the Trust shall have received from Schuller as
Interim Interest under the Indenture Supplement.
(vii) In the event that the sum of (A) the Adjusted
Repurchase and Interest Amount and (B) the Second Bond Reserve Amount
(if any), in each case as set forth in a notice given pursuant to
paragraph (ii) above, exceeds the aggregate principal amount of the
outstanding Schuller Notes then held by the Company and the Trust, the
Company and the Trust shall include in the Adjustment Notice given to
the Indenture Trustee pursuant to paragraph (iii) above a request that
Schuller issue additional Schuller Notes (the "Supplemental Schuller
Notes") to the Company in the aggregate principal amount equal to such
excess. The amount of such excess shall be designated in the
Adjustment Notice and is referred to herein as the "Additional
Principal Amount." The Company shall cause Schuller to issue the
Supplemental Schuller Notes to the Company under the Amended and
Restated Indenture as part of the Adjusted Schuller Notes issued to
the Company pursuant to clause (C) of paragraph (v) above, as a
payment under the Demand Note or as a dividend. Upon their issuance,
the Supplemental Schuller Notes shall become Adjusted Schuller Notes
for all purposes of this Agreement and the
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Indenture and shall be transferred to the Trust as part of the Company
Adjustment Notes to the extent provided in paragraph (vi) above.
(viii) The Company shall cause Schuller to comply
with the terms of the Indenture Supplement and to take all actions
that are necessary or appropriate to carry out the transactions
contemplated by this Section 2.03(b).
(c) First Offering Consummated After Adjustment Period. If a
first Offering is to be consummated by the Trust at any time after the
Adjustment Period, the Trust shall notify the Company of the consummation date
at least five Business Days prior to such consummation date, and the Company
shall cause Schuller to give notice to the Indenture Trustee in accordance with
those terms of Section 4 of the Indenture Supplement which apply to the First
Offering Notice referred to therein and shall cause Schuller to comply with the
other terms of Section 4 of the Indenture Supplement. Such First Offering
Notice shall be in a form that has been submitted to and approved by the Trust
in advance.
SECTION 2.04. Registration Rights with Respect to Schuller
Repurchase Notes. (a) Shelf Registration. If at any time and from time to
time the Trust shall in good faith determine that it intends to undertake a
public distribution of any of the Schuller Repurchase Notes and if the Trust
shall so request in writing to the Company, then to the extent permitted by
law, the Company shall cause Schuller to use its best efforts to register the
Schuller Repurchase Notes under shelf indentures and pursuant to Rule 415 under
the Securities Act (or an equivalent or successor provision) (a "Shelf
Registration") and shall cause Schuller to keep such registration in effect at
all times that the Trust holds any of the Schuller Repurchase Notes or until
the Trust notifies the Company in writing that the registration no longer need
remain effective, provided, that the Company shall have no obligation to cause
Schuller to file a shelf registration statement in any January or earlier than
four (4) months after the date on which any other registration statement is
filed pursuant to Section 2.04(a) or (b) ceases to be in effect, provided,
further, that the Company shall have no obligation to cause Schuller to file a
shelf registration statement for an amount below the lesser of (i) $100,000,000
aggregate principal amount of Schuller Repurchase Notes and (ii) all of the
Schuller Repurchase Notes held by the Trust. If the Trust, the Company or
Schuller deems it necessary to obtain a determination from the appropriate
regulatory authorities that a Shelf Registration is permitted by law, the
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<PAGE> 23
Company shall cause Schuller to use its best efforts, in cooperation with the
Trust and the Company, to obtain such a determination.
(b) Demand Registration. If at any time and from time to
time when a Shelf Registration is not in effect the Trust shall in good faith
determine that it intends to undertake a public distribution of all or any
portion of the Schuller Repurchase Notes and the Trust shall request in writing
to the Company that the Company cause Schuller to effect the registration under
the Securities Act of any Schuller Repurchase Notes (which request shall
specify the aggregate principal amount of Schuller Repurchase Notes proposed to
be offered and sold by the Trust, shall describe the nature or method of the
proposed offer and sale thereof and shall contain an undertaking by the Trust
to cooperate with the Company and Schuller in order to permit Schuller to
comply with all applicable requirements of the Securities Act and the rules and
regulations thereunder and to obtain acceleration of the effective date of the
registration statement), the Company shall cause Schuller, as expeditiously as
possible, to use its best efforts to effect the registration of such Schuller
Repurchase Notes which the Trust has requested it to register on an appropriate
form under the Securities Act and keep such registration in effect for a period
of nine months or for such lesser period as shall be required to complete the
distribution of all the Schuller Repurchase Notes covered thereby. The
registration rights contemplated by this Section 2.04(b) may be exercised from
time to time in the discretion of the Trust with respect to all or any part of
the Schuller Repurchase Notes then held by the Trust, provided that the Company
shall have no obligation to cause Schuller to file a registration statement in
any January or earlier than four (4) months after the date on which any other
registration statement filed pursuant to Section 2.04(a) or (b) ceases to be in
effect, provided, further that the Company shall have no obligation to cause
Schuller to file a registration statement for an amount below the lesser of (i)
$100,000,000 aggregate principal amount of Schuller Repurchase Notes and (ii)
all of the Schuller Repurchase Notes held by the Trust.
(c) Piggyback Registration.
(i) Piggyback Registration Rights of the Trust. If Schuller
proposes to file a registration statement under the Securities Act with respect
to an offering of any debt securities of Schuller (including, without
limitation, Schuller Excess Notes) for Schuller's own account and/or for the
account of other Persons, including, without limitation, the Company (other
than a registration statement on Form S-4 or S-8 or any successor forms),
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then the Company shall cause Schuller to give written notice of such proposed
filing to the Trust at least thirty (30) days before the anticipated filing
date, and such notice shall offer the Trust the opportunity to register any or
all of the Schuller Repurchase Notes then held by the Trust, as the Trust may
request in writing to Schuller within fifteen (15) days after such notice is
given in accordance with this Section; provided, however, that if at any time
after giving written notice of its intention to register any Schuller
securities and prior to the effective date of the registration statement filed
in connection with such registration, Schuller shall determine for any reason
not to register or to delay registration, Schuller may, at its election, give
written notice of such determination to the Trust and (1) in the case of a
determination not to register, shall be relieved of its obligation to register
any Schuller Repurchase Notes in connection with such registration and (2) in
the case of a determination to delay registering, shall be permitted to delay
registering any Schuller Repurchase Notes to be sold by the Trust for the same
period as the delay in registering such other Schuller securities. The Company
shall use, and shall cause Schuller to use, its best efforts to cause the
managing underwriter or underwriters of a proposed underwritten offering by
Schuller to include the Schuller Repurchase Notes held by the Trust in such
offering on the same terms and conditions as any similar securities included
therein. Notwithstanding the foregoing, if, in the opinion of the managing
underwriter or underwriters of such offering (which opinion shall be expressed
in writing and a copy thereof provided to the Trust), the total amount or kind
of securities to be included in such offering is sufficiently large or
otherwise likely to materially and adversely affect the success of such
offering (including, but not limited to, the offering price per security to be
registered), then, in connection with such proposed offering, without any
reduction in the amount of securities Schuller proposes to issue and sell for
its own account, the amount of Schuller Repurchase Notes to be offered for the
account of the Trust shall be reduced to the extent necessary to reduce the
total amount of securities to be included in such offering to the amount stated
by such managing underwriter or underwriters in the aforesaid written opinion
to be the largest amount that, in the opinion of such underwriter(s), can be
sold without such material adverse effect; provided that, if securities are
being offered for the account of other Persons (including, without limitation,
the Company or Schuller), such reduction shall not represent a greater portion
of the number or amount of Schuller Repurchase Notes intended to be offered by
the Trust than the portion of similar reductions imposed on such other Persons
on the amount of securities they intended to offer.
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(ii) Piggyback Registration Rights of the Company. If the
Trust exercises its rights under Section 2.04(b) hereof to cause the
registration of any Schuller Repurchase Notes, the Company shall have the right
to include in such registration any Schuller Excess Notes held by it, as the
Company may request in writing to the Trust within fifteen (15) days after
notice from the Trust of its request for registration in accordance with
Section 2.04(b); provided that (A) under no circumstances shall any Schuller
securities held by any Person other than the Company be included in such
registration; and (B) notwithstanding the other terms of this Section
2.04(c)(ii), the Trust shall have the right, in its sole discretion and without
liability or obligation to Schuller or the Company, to decide at any time and
for any reason not to proceed with such registration or to delay such
registration. The Trust shall use its best efforts to cause the Underwriters
of the proposed offering to include such Schuller Excess Notes held by the
Company in such registration on the same terms and conditions as the Schuller
Repurchase Notes of the Trust included therein. Notwithstanding the foregoing,
if, in the opinion of the Underwriters of such registration (which opinion
shall be expressed in writing and a copy thereof provided to the Company), the
total amount of Schuller Notes to be included in such offering is sufficiently
large or otherwise likely to materially and adversely affect the success of
such offering (including, but not limited to, the offering price per Schuller
Note), then, in connection with such proposed offering, and without any
reduction in the amount of securities the Trust proposes to sell for its
account, the amount of Schuller Excess Notes to be offered for the account of
the Company shall be reduced to the extent necessary to reduce the total amount
of Schuller Notes to be included in such offering to the amount stated by such
Underwriters in the aforesaid written opinion to be the largest amount that, in
the opinion of such Underwriter(s), can be sold without such material adverse
effect.
(d) Registration Procedures. At any time that the Company is
obligated to cause Schuller to use its best efforts to effect the registration
under the Securities Act of any Schuller Repurchase Notes pursuant to Sections
2.04(a) or (b), or at any time that the Trust exercises its piggyback
registration right pursuant to Section 2.04(c)(i) subject to the terms thereof,
the Company shall cause Schuller, as expeditiously as possible, to:
(i) prepare and file with the Commission a
registration statement on the appropriate form with respect to such
Schuller Repurchase Notes and use its best efforts to cause such
registration statement to become effective;
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(ii) before filing a registration statement or
prospectus or any amendments or supplements thereto, provide the Trust
and its counsel and the Underwriters (if any) and their counsel with
the opportunity to participate in the preparation of such registration
statement, prospectus, amendment or supplement, and furnish to the
Trust and its counsel and the Underwriters (if any) and their counsel
(and to any Person designated by the Trust or such counsel), copies of
all documents proposed to be filed with the Commission in sufficient
time prior to such filing to permit the Trust and its counsel, and, if
applicable, the Underwriters and their counsel, a reasonable
opportunity to review such documents, which documents will be subject
to the prompt and reasonable review and comment of the Trust and such
counsel and, if applicable, the Underwriters and their counsel, and,
if requested by such counsel, to cause such documents to be amended by
the insertion of material that, in the judgment of such counsel,
should be included (subject, however, to the reasonable approval of
counsel to the Company and Schuller);
(iii) take such action (including filing with the
Commission amendments and supplements to the registration statement
and the prospectus used in connection therewith) as may be necessary
to keep such registration statement effective for the period of time
required under the terms of this Agreement;
(iv) furnish to the Trust and the Underwriters (if
any) and their counsel, such number of copies of (A) such registration
statement (including all exhibits thereto), (B) each amendment and
supplement thereto (in each case including all exhibits thereto), (C)
the prospectus included in such registration statement (including each
preliminary prospectus) and (D) such other documents, as the Trust and
each such Underwriter may reasonably request in order to facilitate
the distribution of such Schuller Repurchase Notes;
(v) promptly deliver to the Trust and its counsel,
and the Underwriters (if any) and their counsel, copies of all
correspondence between the Commission (or any Governmental Agency
regulating the issuance of securities) and the Company or Schuller,
their counsel or auditors and all memoranda relating to discussions
with the Commission with respect to any such registration statement;
(vi) furnish, at the request of the Trust, on each
date that such Schuller Repurchase Notes are delivered to Underwriters
for sale pursuant to such registration statement
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or, if such Schuller Repurchase Notes are not being sold through
Underwriters, on each date the registration statement with respect to
such Schuller Repurchase Notes becomes effective (or, if the Schuller
Repurchase Notes are registered pursuant to a Shelf Registration, on
the date such Shelf Registration becomes effective and on each date a
post-effective amendment of such Shelf Registration becomes effective)
(A) an opinion or opinions, dated such date, of counsel representing
Schuller for the purposes of such registration (including an opinion
of outside counsel covering such of the following matters (if any) as
are customarily, covered in opinions of issuer's outside counsel in
firm commitment Securities Act underwritten public offerings),
addressed to the Underwriters, if any, and to the Trust, substantially
to the effect that (1) the registration statement, related prospectus,
and each amendment or supplement thereto (including documents
incorporated by reference therein), complied, when declared effective
with respect to registration statements and otherwise when filed, as
to form in all material respects with the requirements of the
Securities Act or the Exchange Act, as the case may be, and the
applicable rules and regulations of the Commission thereunder (except
that such counsel need express no opinion as to the financial
statements and other financial data contained therein), (2) the
Indenture is a valid and binding obligation of Schuller, enforceable
in accordance with its terms (except as such enforceability may be
limited by bankruptcy, insolvency, moratorium or similar laws relating
to enforcement of creditors' rights generally and by the availability
of equitable remedies of general applicability) and has been duly
qualified under the TIA, (3) the Schuller Notes covered by such
registration statement are valid and binding obligations of Schuller,
enforceable in accordance with their terms (except as such
enforceability may be limited by bankruptcy, insolvency, moratorium or
similar laws relating to enforcement of creditors' rights generally
and by the availability of equitable remedies of general
applicability), and (4) such other legal matters with respect to the
registration statement and Schuller and the Company customarily
covered in opinions to underwriters as the Underwriters, if any, or
the Trust may reasonably request, including, without limitation, a
statement that such counsel believes that the registration statement
(and any amendment or supplement thereto or document incorporated by
reference therein), at the time such registration statement became
effective (or in the case of any amendment or supplement or document
incorporated by reference, at the time it was filed), did not contain
any untrue statement of a material fact or omit to state a material
fact required to be stated
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therein or necessary to make the statements therein not misleading and
that the prospectus as amended or supplemented, if applicable
(including documents incorporated by reference therein), on the date
of such opinion, does not contain any untrue statement of a material
fact or omit to state a material fact necessary in order to make the
statements, in the light of the circumstances under which they were
made, not misleading (except that such counsel need express no belief
as to the financial statements and other financial data contained in
the registration statement or the prospectus), and (B) a letter, dated
such date, from the Independent certified public accountants of
Schuller, addressed to the Underwriters, if any, and to the Trust,
stating that they are "independent" certified public accountants
within the meaning of the Securities Act and that the financial
statements and other financial data of Schuller included in the
registration statement or the prospectus, or any amendment or
supplement thereto (including, in each case, documents incorporated by
reference therein), comply as to form in all material respects with
the applicable accounting requirements of the Securities Act, such
letter from the accountants shall additionally cover such other
financial matters (including information as to the period ending not
more than five (5) Business Days prior to the date of such letter)
with respect to the registration statement that is of the type
ordinarily included in accountants' "comfort letters" to underwriters
as the Underwriters, if any, or the Trust may reasonably request;
(vii) use its best efforts to register or qualify
the Schuller Repurchase Notes covered by such registration statement
under the securities or blue sky laws of such jurisdictions in the
United States as the Trust shall reasonably request, considering the
nature and size of the offering, and do any and all other acts and
things which may be necessary or desirable to enable the Trust and the
Underwriters (if any) to consummate the public sale or other
disposition in each such jurisdiction of such Schuller Repurchase
Notes, provided that in connection therewith neither the Company nor
Schuller shall be required to file a general consent to service of
process in any jurisdiction or to qualify to do business in any
jurisdiction where it is not then qualified;
(viii) notify the Trust and its counsel and the
Underwriters (if any) and their counsel, at any time when a
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prospectus relating to such Schuller Repurchase Notes is required to
be delivered under the Securities Act, of the happening of any event
as a result of which the prospectus included in such registration
statement contains an untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading, and promptly prepare a
supplement or amendment to such prospectus so that, as thereafter
delivered to the purchasers of such Schuller Repurchase Notes, such
prospectus will not contain an untrue statement of a material fact or
omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading;
(ix) enter into such customary agreements (including
an underwriting agreement in customary form) and take all such other
customary actions as the Trust or the Underwriters of such Schuller
Repurchase Notes reasonably request in order to expedite or facilitate
the disposition of the Schuller Repurchase Notes;
(x) make available, upon reasonable notice and
during business hours, for inspection by the Trust, and any
Underwriter participating in any distribution pursuant to such
registration statement and any attorney, accountant or other agent
retained by the Trust or any such Underwriter (collectively, the
"Inspectors"), all financial and other records, pertinent corporate
documents and properties of Schuller (and the Company shall similarly
make available such of its own records, documents and properties)
(collectively, the "Records") as shall be reasonably necessary to
enable them to exercise their due diligence responsibility, and cause
Schuller and its officers, directors, employees and independent public
accountants to make themselves reasonably available to discuss the
business and financial condition of Schuller and to supply all
information reasonably requested by any such Inspector, in connection
with such registration statement; provided that none of such Records
shall be photocopied by the Inspectors and any such inspection shall
be conducted in a manner that does not unreasonably interfere with the
normal business operations of Schuller. Records which Schuller (or
the Company, with respect to the Company's Records) determines, in
good faith, to be confidential and which it notifies the Inspectors in
writing are confidential shall not be disclosed to the Inspectors and
only may be reviewed by counsel for the Trust and for any Underwriter;
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(xi) notify the Trust of any stop order issued or,
to the knowledge of the Company or Schuller, threatened by the
Commission and take all reasonable actions required to prevent the
entry of such stop order or to remove it if entered; and
(xii) otherwise use its best efforts to comply with
all applicable rules and regulations of the Commission.
The Company shall cause Schuller to prepare and deliver
certificates (in engraved form if requested by the Trust) substantially
identical to the certificates representing the Schuller Repurchase Notes being
registered and, if requested by the Trust, shall cause Schuller, at the Trust's
expense, to obtain ratings of such Schuller Repurchase Notes from two
nationally recognized rating agencies selected by the Trust.
The Company and Schuller may request that the Trust furnish in
writing to the Company and Schuller information regarding the Trust and the
disposition by the Trust of the Schuller Repurchase Notes to be included in the
registration statement, and the Trust agrees to furnish in writing such
information to the Company and Schuller and any other information as the
Company or Schuller may reasonably request in connection with the preparation
of such registration statement.
The Trust agrees that, upon receipt of any notice from the
Company or Schuller of any event of the kind described in paragraph (viii) of
this Section 2.04(d), the Trust will forthwith discontinue distribution of
Schuller Repurchase Notes pursuant to the registration statement covering such
Schuller Repurchase Notes until the Trust's receipt of the copies of the
supplemented or amended prospectus contemplated by such paragraph. If the
Company or Schuller shall give any such notice, the period stated in Section
2.04(b) during which the Company must cause Schuller to keep a registration
statement in effect, if applicable, shall be extended by the number of days
during the period from and including the date of the giving of such notice
pursuant to paragraph (viii) of this Section 2.04(d) to and including the date
when the Trust shall have received the copies of the supplemented or amended
prospectus contemplated by paragraph (viii) of this Section 2.04(d).
If any such registration statement refers to the Trust by name
or otherwise as the holder of the Schuller Repurchase Notes or any other
security of the Company or Schuller, then the Trust shall have the right to
require the insertion therein of language, in form and substance satisfactory
to the Trust, the Company and Schuller to the effect that the holding by the
Trust
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of the Schuller Repurchase Notes or such other securities is not to be
construed as a recommendation by the Trust or any of the Trustees of the
investment quality of the Schuller Repurchase Notes covered thereby and that
such holding does not imply that the Trust will assist in meeting any future
financial requirements of the Company or of Schuller.
(e) Registration Expenses. The Company shall cause Schuller
to pay all costs and expenses in connection with any registration (except that
in the case of the first registration, the Company shall pay all costs and
expenses in connection with such registration) pursuant to this Section 2.04
(whether or not any such registration shall become effective), including,
without limitation, all registration and filing fees, fees and expenses of
compliance with securities or blue sky laws (including reasonable fees and
disbursements of counsel for the Underwriters in connection with blue sky
qualifications of the Schuller Notes), printing and duplicating expenses,
messenger and delivery expenses, fees and disbursements of counsel for the
Company and Schuller and all independent certified public accountants of the
Company and Schuller (including the expenses of any annual audit, special audit
or "cold comfort" letters required by or incident to such performance),
securities acts liability insurance (if the Company or Schuller elects to
obtain such insurance), fees and expenses of the indenture trustee selected in
accordance with Section 2.04(g), the reasonable fees and expenses of any
special experts retained for the Company or Schuller in connection with such
registration, and fees and expenses of other Persons retained by the Company or
Schuller; provided that costs and expenses to be paid by Schuller (or the
Company in the case of the first such registration) shall not include fees and
expenses of counsel retained by the Trust or the Underwriters, if any, (except
for reasonable fees and disbursements of counsel in connection with blue sky
qualifications of the Schuller Notes) and other out-of-pocket expenses of the
Trust or the Underwriters, if any, (and any Persons retained by the Trust or
the Underwriters, if any, to act as Inspectors) incurred in connection with any
registration and any underwriting discounts or commissions attributable to the
sale by the Trust of the Schuller Repurchase Notes.
(f) Indemnification.
(i) In each case of a registration of any Schuller
Notes held by the Trust under the Securities Act pursuant to this
Section 2.04, the Company shall cause Schuller to indemnify and hold
harmless the Trust, each Trustee, each officer of the Trust, each
underwriter (as defined in the Securities Act) and each other Person,
if any, who controls the Trust or
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any such underwriter within the meaning of the Securities Act or the
Exchange Act from and against any and all losses, claims, damages and
liabilities, joint or several, to which any of the Trust, each
Trustee, each officer of the Trust, each underwriter (as defined in
the Securities Act) and each other controlling Person, if any, may
become subject, under the Securities Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in any registration statement
under which such Schuller Notes were registered under the Securities
Act and/or under the securities or blue sky laws of any jurisdictions
in the United States, any prospectus or preliminary prospectus
contained therein or any amendment or supplement thereto (including,
in each case, documents incorporated by reference therein), or caused
by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, and will reimburse the Trust, each Trustee,
each officer of the Trust, each underwriter (as defined in the
Securities Act) and each such controlling Person, if any, for any
legal or other expenses reasonably incurred by any of the foregoing in
connection with investigating or defending any such action or claim as
such expenses are incurred; provided, howeve, that neither the Company
nor Schuller shall be liable to indemnify a party seeking
indemnification in any such case to the extent that any such losses,
claims, damages or liabilities arise out of or are based upon an
untrue statement or omission or alleged untrue statement or omission
made in a preliminary prospectus, the registration statement or the
prospectus or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company or
Schuller by such party expressly for use therein.
(ii) In each case of a registration of Schuller
Repurchase Notes held by the Trust under the Securities Act pursuant
to this Section 2.04, the Trust will indemnify and hold harmless the
Company, Schuller, each of their directors, their officers who sign
the registration statement and each Person, if any, who controls the
Company or Schuller within the meaning of the Securities Act or the
Exchange Act, to the same extent as the foregoing indemnity from
Schuller to the Trust, but only with reference to information relating
to the Trust itself (and not to the Company or any of its
Subsidiaries) and furnished to the Company or Schuller in writing by
the Trust expressly for use in the registration statement,
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any prospectus or preliminary prospectus contained therein or any
amendment or supplement thereto. The Trust will use its best efforts
to cause any Underwriters of Schuller Notes to be sold by the Trust to
indemnify the Company and Schuller on the same terms as the Trust
agrees to indemnify the Company, but only with reference to
information relating to such Underwriters themselves.
(iii) In case any proceeding (including any
governmental investigation) shall be instituted involving any Person
in respect of which indemnity may be sought pursuant to this Section
2.04, such Person (the "Indemnified Party") shall promptly notify the
Person against whom such indemnity may be sought (the "Indemnifying
Party") in writing and the Indemnifying Party, upon request of the
Indemnified Party, shall retain counsel reasonably satisfactory to the
Indemnified Party to represent the Indemnified Party and any others
the Indemnifying Party may designate in such proceeding and shall pay
the fees and disbursements of such counsel related to such proceeding.
In any such proceeding, any Indemnified Party shall have the right to
retain its own counsel, but the fees and expenses of such counsel
shall be at the expense of such Indemnified Party unless (A) the
Indemnifying Party has agreed to the retention of such counsel at its
expense or (B) the named parties to any such proceeding (including any
impleaded parties) include both the Indemnifying Party and the
Indemnified Party and representation of both parties by the same
counsel would be inappropriate due to actual or potential differing
interests between them. It is understood that the Indemnifying Party
shall not, in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for the fees and expenses of more
than one separate firm qualified in such jurisdiction to act as
counsel for all such Indemnified Parties, except that, if Schuller is
the Indemnifying Party, it shall be responsible for up to two such
firms, one for the Trust (and all of its affiliated Indemnified
Parties) and one for all of the underwriters as a group (and all of
their affiliated Indemnified Parties). Such firm shall be deemed
satisfactory to the Indemnified Party, unless within ten (10) days of
the Indemnified Party's receipt of notice of the selection of such
firm, the Indemnifying Party receives notice in writing by the
Indemnified Party that such firm is not reasonably satisfactory to
such Indemnified Party. The Indemnifying Party shall not be liable
for any settlement of any proceeding effected without its written
consent but if settled with such consent or if there be a final,
nonappealable judgment for the plaintiff, the Indemnifying Party
agrees to indemnify the Indemnified
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Party from and against any loss or liability by reason of such
settlement or judgment.
(iv) The indemnification of any underwriter pursuant
to paragraphs (i) and (ii) of this Section 2.04(f) shall be on such
other terms and conditions as are at the time customary and reasonably
required by underwriters in public offerings, including providing for
contribution in the event indemnification provided in this Section
2.04 is unavailable or insufficient.
(g) Qualification of Indenture under the TIA. Prior to the
consummation of a registered public offering the Company shall cause Schuller
to use its best efforts to qualify the Indenture under the TIA. The Company
agrees to cause Schuller to amend the Indenture (and the Trust shall consent to
such amendment), if necessary, to contain such terms as may be required at such
time to effect the qualification of the Indenture under the TIA.
SECTION 2.05. Blackout Periods With Respect to Schuller
Securities. (a) Except as otherwise provided in Section 2.04(c) or agreed in
writing by the Company and the Trust, (i) the Company agrees not to, and
agrees to cause Schuller and each of the Company's other Subsidiaries not to,
offer, sell, contract to sell or otherwise dispose of any debt securities of
Schuller in a registered public offering or an offering pursuant to Rule 144A
under the Securities Act (or any successor provision) within 90 days after the
Repurchase Date and from any date the Company receives written notice from the
Trust of the Trust's intention to sell $25,000,000 or more (gross proceeds to
the Trust) of Schuller Repurchase Notes until the earlier of (a) 60 days after
the receipt of such notice or (b) the completion of such sale by the Trust, and
(ii) the Trust agrees not to offer, sell, contract to sell or otherwise dispose
of any Schuller Repurchase Notes in a registered public offering or an offering
pursuant to Rule 144A under the Securities Act (or any successor provision)
from the date the Trust receives written notice from Schuller of Schuller's
intention to sell $25,000,000 or more (gross proceeds to Schuller) of its debt
securities until the earlier of (a) 60 days after the receipt of such notice or
(b) the completion of such sale by Schuller; provided, however, that the
foregoing terms of this clause (ii) shall not apply to the first Offering by
the Trust. Neither Schuller nor the Trust may give any such notice within
ninety (90) days of giving its most recent notice.
(b) From time to time at the request of the Trust, the
Company will cause Schuller to provide to the Trust a schedule of
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maturities of, and expected refinancing plans concerning, its then outstanding
Debt.
SECTION 2.06. Private Placement of Schuller Repurchase
Notes. (a) If at any time the Trust shall in good faith determine that it
intends to undertake a private placement of at least $100,000,000 aggregate
principal amount of Schuller Repurchase Notes or, if the Trust holds less than
such amount, all of the Schuller Repurchase Notes held by the Trust and the
Trust shall request in writing to the Company that the Company cause Schuller
to assist the Trust in effecting such placement (which request shall specify
the aggregate principal amount of Schuller Repurchase Notes proposed to be
offered and sold by the Trust, shall describe the nature or method of the
proposed offer and sale thereof and shall contain an undertaking by the Trust
to cooperate with the Company and Schuller in order to permit Schuller to
comply with all applicable requirements of the Securities Act and the rules and
regulations thereunder), the Company shall cause Schuller to use its best
efforts to cooperate with the Trust in effecting such private placement, and
shall cause Schuller, as expeditiously as possible, to:
(i) prepare an offering memorandum in form and
substance satisfactory to the Trust and any Placement Agent and their
respective counsels;
(ii) before finalizing an offering memorandum or any
amendments or supplements thereto, provide the Trust and its counsel
and the Placement Agents and their counsel with the opportunity to
participate in the preparation of such offering memorandum, amendment
or supplement, and furnish to the Trust and its counsel and the
Placement Agents and their counsel (and to any Person designated by
the Trust or such counsel), copies of all amendments or supplements to
the offering memorandum in sufficient time to permit the Trust and its
counsel, and the Placement Agents and their counsel a reasonable
opportunity to review such documents, which documents will be subject
to the prompt and reasonable review and comment of the Trust and such
counsel and the Placement Agents and their counsel, and, if requested
by any such counsel, to cause such documents to be amended by the
insertion of material that, in the judgment of such counsel, should be
included (subject, however, to the reasonable approval of counsel to
the Company and Schuller);
(iii) furnish to the Trust and each Placement Agent
of the Schuller Repurchase Notes being sold such number
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of copies of (A) such offering memorandum (including all exhibits
thereto), (B) each amendment and supplement thereto (in each case
including all exhibits thereto), and (C) such other documents, as the
Trust and each such Placement Agent may reasonably request in order to
facilitate the sale of such Schuller Repurchase Notes;
(iv) promptly deliver to the Trust, each Placement
Agent of the Schuller Repurchase Notes and their respective counsel
copies of all correspondence between any Governmental Agency
regulating the issuance of securities and the Company or Schuller,
their counsel or auditors and all memoranda relating to discussions
with any such Governmental Agency with respect to the Schuller
Repurchase Notes;
(v) furnish, at the request of the Trust, on each
date that such Schuller Repurchase Notes are delivered to the
Placement Agents for sale pursuant to such offering memorandum or, if
such Schuller Repurchase Notes are not being sold through Placement
Agents, then to the purchasers of the Schuller Repurchase Notes, (A)
an opinion or opinions, dated such date, of counsel representing
Schuller for the purposes of such private placement (including an
opinion of outside counsel covering such of the following matters (if
any) as are customarily covered in opinions of issuer's outside
counsel in private placements of debt securities for institutional
investors), addressed to the Placement Agents or purchasers, as the
case may be, and to the Trust, substantially to the effect that (1)
the Indenture is a valid and binding obligation of Schuller,
enforceable in accordance with its terms (except as such
enforceability may be limited by bankruptcy, insolvency, moratorium or
similar rights relating to enforcement of creditors' rights generally
and by the availability of equitable remedies of general
applicability), (2) the Schuller Repurchase Notes being sold in such
private placement are valid and binding obligations of Schuller,
enforceable in accordance with their terms (except as such
enforceability may be limited by bankruptcy, insolvency, moratorium or
similar rights relating to enforcement of creditors' rights generally
and by the availability of equitable remedies of general
applicability), and (3) such other legal matters with respect to the
offering memorandum, the Schuller Notes, Schuller and the Company
customarily covered in opinions to purchasers in such private
placements as the Placement Agent or purchasers, as applicable, or the
Trust may reasonably request including, without limitation, a
statement that such counsel believes that the offering memorandum and
each amendment or supplement thereto, as of the date thereof,
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did not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading and that the offering
memorandum, as amended or supplemented, if applicable, on the date of
such opinion, does not contain any untrue statement of a material fact
or omit to state a material fact necessary in order to make the
statements, in the light of the circumstances under which they were
made, not misleading (except that such counsel need express no belief
as to the financial statements and other financial data contained in
the offering memorandum); and (B) a letter, dated such date, from the
Independent certified public accountants of Schuller, addressed to the
Placement Agents or the purchasers, as applicable, and to the Trust,
stating that they are "independent" certified public accountants
within the meaning of the Securities Act and that the financial
statements and other financial data of Schuller included in the
offering memorandum or any amendment or supplement thereto, comply as
to form in all material respects with the applicable accounting
requirements of the Securities Act, such letter from the accountants
shall additionally cover such other financial matters (including
information as to the period ending not more than five (5) Business
Days prior to the date of such letter) with respect to the offering
memorandum that is of the type ordinarily included in accountants'
"comfort letters" to placement agents or purchasers, as the Placement
Agents or purchasers, as applicable, or the Trust may reasonably
request;
(vi) use its best efforts to register or qualify the
Schuller Repurchase Notes under the securities or blue sky laws of
such jurisdictions in the United States as the Trust shall reasonably
request, considering the nature and size of the offering, and do any
and all other acts and things which may be necessary or desirable to
enable the Trust and any Placement Agent of such Schuller Repurchase
Notes to consummate the sale or other disposition in each such
jurisdiction of such Schuller Repurchase Notes, provided that in
connection therewith neither the Company nor Schuller shall be
required to file a general consent to service of process in any
jurisdiction or to qualify to do business in any jurisdiction where it
is not then qualified;
(vii) enter into a placement agreement with the
Trust and Placement Agent(s) (or the Persons purchasing such Schuller
Repurchase Notes from the Trust) containing representations and
warranties by Schuller, including representations and warranties
substantially similar to those relating
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to Schuller set forth in Section 4.01 hereof (with appropriate changes
to have Schuller make such representations and warranties with respect
to itself and to update references to financial statements as
appropriate) and such further representations and warranties which are
customary in such an agreement as the Trust or Placement Agent (or the
Persons purchasing such Schuller Repurchase Notes from the Trust) may
reasonably request; and enter into such other customary agreements,
and take all such other customary actions, as the Trust or the
Placement Agent(s) of such Schuller Repurchase Notes reasonably
request in order to expedite or facilitate the disposition of the
Schuller Repurchase Notes. The Trust shall be a party to the
placement agreement between Schuller and the Placement Agent(s) (or
the Persons purchasing the Schuller Repurchase Notes from the Trust)
and may, at its option, require that any or all of the representations
and warranties by, and the other agreements on the part of, Schuller
to and for the benefit of the Placement Agent(s) (or the Persons
purchasing the Schuller Repurchase Notes from the Trust) shall also be
made to and for the benefit of the Trust and that any or all of the
conditions precedent to the obligations of the Placement Agent(s) (or
the Persons purchasing the Schuller Repurchase Notes from the Trust)
under such placement agreement be conditions precedent to the
obligations of the Trust. The Trust shall not be required to make any
representations or warranties to or agreements with Schuller or the
Placement Agent(s) (or the Persons purchasing the Schuller Repurchase
Notes from the Trust) other than representations, warranties or
agreements regarding the Trust, the Schuller Repurchase Notes being
offered by the Trust, the Trust's intended method of distribution and
any other representation required by law;
(viii) make available, upon reasonable notice and
during business hours, for inspection by the Trust, any Placement
Agent participating in any distribution pursuant to such offering
memorandum or, if no Placement Agent is used, to each purchaser of
Schuller Repurchase Notes, and any attorney, accountant or other agent
retained by the Trust or any such Placement Agent or purchaser
(collectively, the "Representatives"), all financial and other Records
as shall be reasonably necessary to enable them to exercise their due
diligence responsibility, and cause Schuller and its officers,
directors, employees and Independent certified public accountants to
make themselves reasonably available to discuss the business and
financial condition of Schuller and to
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supply all information reasonably requested by any such
Representative, in connection with such private placement; provided
that none of such Records shall be photocopied by the Representatives
and any such inspection shall be conducted in a manner that does not
unreasonably interfere with the normal business operations of
Schuller. Records which Schuller (or the Company, with respect to the
Company's Records) determines, in good faith, to be confidential and
which it notifies the Representatives in writing are confidential
shall not be disclosed to the Representatives and only may be reviewed
by counsel for the Trust and for any Placement Agent;
(ix) obtain, if the Trust requests, a private
placement number issued by Standard & Poor's Corporation CUSIP Service
Bureau for the Schuller Repurchase Notes;
(x) use its best efforts to cause the Schuller
Repurchase Notes to be eligible for the PORTAL trading system of the
National Association of Securities Dealers; and
(xi) otherwise use its best efforts to cooperate
with the distribution of the Schuller Repurchase Notes by the Trust.
(b) The Company agrees to cause Schuller to prepare and
deliver certificates (in engraved form if requested by the Trust) substantially
identical to the certificates representing the Schuller Repurchase Notes being
sold and, if requested by the Trust, to obtain ratings of such Schuller
Repurchase Notes from two nationally recognized rating agencies selected by the
Trust, at the Trust's expense.
(c) The Company and Schuller may request that the Trust
furnish in writing to the Company and Schuller information regarding the Trust
and the disposition of the Schuller Repurchase Notes, and the Trust agrees to
furnish in writing such information to the Company and Schuller and any other
information as the Company or Schuller may reasonably request in connection
with the preparation of such offering memorandum.
(d) If any such offering memorandum refers to the Trust by
name or otherwise as the holder of the Schuller Repurchase Notes or any other
security of the Company or Schuller, then the Trust shall have the right to
require the insertion therein of language, in form and substance satisfactory
to the Trust, the Company and Schuller to the effect that the holding by the
Trust of the Schuller Repurchase Notes or such other securities is not to be
construed as a recommendation by the Trust or any of the
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Trustees of the investment quality of the Schuller Repurchase Notes covered
thereby and that such holding does not imply that the Trust will assist in
meeting any future financial requirements of the Company or of Schuller.
(e) Placement Expenses. The Company shall cause Schuller to
pay all costs and expenses in connection with any private placement of the
Schuller Repurchase Notes pursuant to this Section 2.06, including, without
limitation, all fees and expenses of compliance with securities or blue sky
laws (including reasonable fees and disbursements of counsel for the Placement
Agent(s) in connection with blue sky qualifications of the Schuller Repurchase
Notes), printing and duplicating expenses, messenger and delivery expenses,
fees and disbursements of counsel for the Company and Schuller and all
independent certified public accountants of the Company and Schuller
(including the expenses of any annual audit, special audit or "cold comfort"
letters required by or incident to such performance), securities acts liability
insurance (if the Company or Schuller elects to obtain such insurance), fees
and expenses of the indenture trustee(s) selected in accordance with Section
2.04(g), the reasonable fees and expenses of any special experts retained for
the Company or Schuller in connection with such private placement, and fees and
expenses of other Persons retained by the Company or Schuller; provided that
costs and expenses to be paid by Schuller shall not include fees and expenses
of counsel retained by the Trust (and any Persons retained by the Trust to act
as Representatives) or the Placement Agents, if any (except for reasonable fees
and disbursements of counsel in connection with blue sky qualifications of the
Schuller Repurchase Notes) and other out-of-pocket expenses of the Trust
incurred in connection with any private placement and any discounts or
commissions attributable to the sale by the Trust of the Schuller Repurchase
Notes.
(f) Indemnification.
(i) In each case of a private placement of Schuller
Repurchase Notes pursuant to this Section 2.06, the Company shall
cause Schuller to indemnify and hold harmless the Trust, each Trustee,
each officer of the Trust, each Placement Agent and each other Person,
if any, who controls the Trust or any Placement Agent from and against
any and all losses, claims, damages and liabilities, joint or several,
to which any of the Trust, each Trustee, each officer of the Trust,
each Placement Agent and each other controlling Person, if any, may
become subject, under the Securities Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are
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based upon an untrue statement or alleged untrue statement of a
material fact contained in any offering memorandum under which such
Schuller Notes were sold and/or under the securities or blue sky laws
of any jurisdictions in the United States, or any amendment or
supplement thereto, or caused by any omission or alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and will
reimburse the Trust, each Trustee, each officer of the Trust, each
Placement Agent and each such controlling Person, if any, for any
legal or other expenses reasonably incurred by any of the foregoing in
connection with investigating or defending any such action or claim as
such expenses are incurred; provided, however, that neither the
Company nor Schuller shall be liable to indemnify a party seeking
indemnification in any such case to the extent that any such losses,
claims, damages or liabilities arise out of or are based upon an
untrue statement or omission or alleged untrue statement or omission
made in an offering memorandum or any such amendment or supplement in
reliance upon and in conformity with written information furnished to
the Company or Schuller by such party expressly for use therein.
(ii) In each case of a private placement of Schuller
Repurchase Notes pursuant to this Section 2.06, the Trust will
indemnify and hold harmless the Company, Schuller, each of their
directors and officers and each Person, if any, who controls the
Company or Schuller within the meaning of the Securities Act or the
Exchange Act, to the same extent as the foregoing indemnity from
Schuller to the Trust, but only with reference to information relating
to the Trust itself (and not to the Company or any of its
Subsidiaries) and furnished to the Company or Schuller in writing by
the Trust expressly for use in the offering memorandum or any
amendment or supplement thereto. The Trust will use its best efforts
to cause any Placement Agents of Schuller Repurchase Notes to be sold
by the Trust to indemnify the Company and Schuller on the same terms
as the Trust agrees to indemnify the Company, but only with reference
to information relating to such Placement Agents themselves.
(iii) In case any proceeding (including any
governmental investigation) shall be instituted involving any Person
in respect of which indemnity may be sought pursuant to this Section
2.06, such Person (the "Indemnitee") shall promptly notify the Person
against whom such indemnity may be sought (the "Indemnitor") in
writing and the Indemnitor, upon request of the Indemnitee, shall
retain counsel reasonably
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satisfactory to the Indemnitee to represent the Indemnitee and any
others the Indemnitor may designate in such proceeding and shall pay
the fees and disbursements of such counsel related to such proceeding.
In any such proceeding, any Indemnitee shall have the right to retain
its own counsel, but the fees and expenses of such counsel shall be at
the expense of such Indemnitee unless (A) the Indemnitor has agreed to
the retention of such counsel at its expense or (B) the named parties
to any such proceeding (including any impleaded parties) include both
the Indemnitor and the Indemnitee and representation of both parties
by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the
Indemnitor shall not, in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the fees and
expenses of more than one separate firm qualified in such jurisdiction
to act as counsel for all such Indemnified Parties, except that, if
Schuller is the Indemnitor, it shall be responsible for up to two such
firms, one for the Trust (and all of its affiliated Indemnitees) and
one for all of the Placement Agents as a group (and all of their
affiliated Indemnitees). Such firm shall be deemed satisfactory to
the Indemnitee, unless within ten days of the Indemnitee's receipt of
notice of the selection of such firm, the Indemnitor receives notice
in writing by the Indemnitee that such firm is not reasonably
satisfactory to such Indemnitee. The Indemnitor shall not be liable
for any settlement of any proceeding effected without its written
consent but if settled with such consent or if there be a final,
nonappealable judgment for the plaintiff, the Indemnitor agrees to
indemnify the Indemnitee from and against any loss or liability by
reason of such settlement or judgment.
(iv) The indemnification of any Placement Agent
pursuant to paragraphs (i) and (ii) of this Section 2.06(f) shall be
on such other terms and conditions as are at the time customary and
reasonably required by placement agents in private placements,
including providing for contribution in the event indemnification
provided in this Section 2.06 is unavailable or insufficient.
(g) Registration Rights. If the Trust so requests, each
private placement of Schuller Repurchase Notes pursuant to this Section 2.06
may provide for a single demand registration on terms substantially similar to
those contained in Section 2.04 so long as such registration is in an aggregate
principal amount of no less than $100 million.
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SECTION 2.07. Selling Efforts. If at any time the Trust
shall in good faith determine that it intends to undertake a sale or
distribution of Schuller Repurchase Notes, the Company will make available, and
will cause Schuller to make available, information reasonably requested by the
Trust or the Underwriters or the Placement Agent (as applicable) and will
undertake, and take, all reasonable actions necessary or desirable to
facilitate the selling efforts in respect thereof. To the extent such actions
will not be unduly burdensome or unreasonably interfere with the normal
operations of Schuller, the Company shall make, and shall cause Schuller to
make, members of the Company's and Schuller's management reasonably available
to the Trust in connection with the Trust's selling efforts, including, if so
requested by any Underwriter, participation in "road shows" and other marketing
activities (the Trust shall pay the reasonable out-of-pocket expenses incurred
by Schuller or the Company in providing such participation in such "road
shows"). The Trust agrees that it will consult with the Company with respect
to its selling efforts.
SECTION 2.08. Agreements with Respect to Schuller Notes and
the Demand Note. The Company agrees that, until the earlier of (i) the
expiration of the Adjustment Period and (ii) the later of the consummation date
of a first Offering by the Trust and the Second Bond Repurchase Date, the
Company shall not, and shall not cause or permit Schuller to, sell, transfer,
assign, exchange, pledge, hypothecate, suffer to exist any adverse claim on,
grant any option to purchase with respect to, or otherwise dispose of any of
the Schuller Notes (including, without limitation, the Schuller Excess Notes or
the Adjusted Schuller Notes) or the Demand Note or any right or interest
therein or thereto, or agree to do any of the foregoing (except to transfer
Schuller Repurchase Notes to the Trust in accordance with the terms of this
Agreement and to exchange all or a portion of the Demand Note for Schuller
Notes to be transferred to the Trust in accordance with the terms of this
Agreement); provided, however, that if the Second Bond Repurchase Date has not
occurred prior to the consummation date of the first Offering by the Trust,
then following the consummation date of the first Offering by the Trust, the
restrictions relating to the Demand Note contained in this Section 2.08 shall
apply only to a principal amount of the Demand Note equal to the Second Bond
Reserve Amount. Except for any actions that may be taken by the Trust or any
actions taken in accordance with this Agreement, the Company agrees that it
shall not, and shall not cause or permit Schuller nor any Person acting on
behalf of the Company or Schuller to, take, directly or indirectly, any action
which would bring the offering, sale or delivery of the Schuller Repurchase
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Notes to the Trust within the registration provisions of the Securities Act.
SECTION 2.09. Rules 144 and 144A. If Schuller shall have
filed a registration statement pursuant to the requirements of Section 12 of
the Exchange Act or a registration statement pursuant to the requirements of
the Securities Act, the Company shall cause Schuller to file the reports
required to be filed by it under the Securities Act and the Exchange Act
(including, without limitation, the reports under Sections 13 and 15(d) of the
Exchange Act referred to in paragraph (c)(1) of Rule 144 under the Securities
Act) and the rules and regulations promulgated thereunder (or, if Schuller is
not required to file such reports, the Company shall cause Schuller, upon the
request of the Trust or any other holder of Schuller Repurchase Notes, to make
publicly available at the requesting holder's sole cost and expense other
information so long as such information is necessary to permit sales under Rule
144A under the Securities Act) and the Company shall take and shall cause
Schuller to take such further action as the Trust may reasonably request, all
to the extent required from time to time to enable the Trust or such holder to
sell Schuller Repurchase Notes without registration under the Securities Act
within the limitation of the exemptions provided by Rule 144 and Rule 144A
under the Securities Act, as such Rules may be amended from time to time, or
any similar rule or regulation hereafter adopted by the Commission. Upon the
request of any holder of Schuller Repurchase Notes, the Company shall deliver
(and shall cause Schuller to deliver) to the Trust or such holder a written
statement as to whether it has complied with such requirements.
ARTICLE III
THE CLOSING
SECTION 3.01. Preliminary Closing. One Business Day prior to
the Repurchase Date, a meeting shall be held at the offices of Donovan Leisure
Newton & Irvine, 30 Rockefeller Plaza, New York, New York, for the presentation
and examination of all documents to be delivered on the Repurchase Date. All
such documents shall be executed and held in escrow until the Repurchase Date.
SECTION 3.02. The Closing. At 10:00 a.m. New York time on the
Repurchase Date, a meeting shall be held at the offices of Donovan Leisure
Newton & Irvine, 30 Rockefeller Plaza, New York, New York, for the purpose of
consummating the transactions contemplated hereby to occur on such date. All
of the transactions to
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take place on the Repurchase Date shall be considered to take place
simultaneously, and no delivery shall be considered to have been made until all
transactions to take place on such date have been completed.
SECTION 3.03. Conditions Precedent to the Obligations of the
Company. The obligations of the Company on the Repurchase Date are subject to
the satisfaction (or waiver in writing by the Company) of each of the following
conditions precedent:
(a) the representations and warranties of the Trust contained
in this Agreement are true and correct in all material respects at and as of
the Repurchase Date,
(b) the concurrence of the SCB and any other consents
required to be obtained by the Trust necessary for the entry into effect of the
Seventh Amendment to the Trust Agreement and the Second Amendment to the
Supplemental Agreement and for the consummation by the Trust of the Repurchase
have been obtained,
(c) the Trust has complied with and performed in all material
respects all covenants and agreements of the Trust to be complied with and
performed on or prior to the Repurchase,
(d) the Trustees have executed and delivered the Seventh
Amendment to the Trust Agreement and the Trust has executed and delivered the
Second Amendment to the Supplemental Agreement,
(e) receipt by the Company of a certificate signed by an
authorized executive officer of the Trust to the foregoing effect, and
(f) receipt by the Company of an opinion of the General
Counsel of the Trust, dated such date, in the form attached as Exhibit J
hereto.
SECTION 3.04. Conditions Precedent to the Obligations of the
Trust. The obligations of the Trust on the Repurchase Date are subject to the
satisfaction (or waiver in writing by the Trust) of each of the following
conditions precedent:
(a) the representations and warranties of the Company
contained in this Agreement are true and correct in all material respects at
and as of such date,
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(b) any consents required to be obtained by the Company or
Schuller necessary for the transactions contemplated by Sections 2.01 and 2.02
have been obtained,
(c) the Related Agreements (except the Amended and Restated
Indenture) have been fully executed and delivered by the parties thereto (other
than the Trust and the Trustees),
(d) the Company and Schuller have complied with and performed
in all material respects all covenants and agreements of the Company to be
complied with and performed on or prior to the Repurchase,
(e) receipt by the Trust of an Officer's Certificate from
each of the Company and Schuller to the foregoing effect,
(f) the SCB have consented to the Seventh Amendment to the
Trust Agreement and the Second Amendment to the Supplemental Agreement, and
(g) receipt by the Trust of an opinion of the General Counsel
of the Company and Schuller, dated such date, in the form attached as Exhibit K
hereto.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Company.
The Company represents and warrants to the Trust on the date hereof (except
with respect to Section 4.01(k)) and as of the Repurchase that:
(a) the Company has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
the State of Delaware, and has all corporate powers and all material
governmental licenses, authorizations, consents and approvals required
to carry on its business as now conducted;
(b) each of this Agreement, the Seventh Amendment to
the Trust Agreement and the other Related Agreements to which the
Company is a party has been duly authorized, executed and delivered by
the Company and constitutes a valid and binding agreement of the
Company, enforceable against the Company in accordance with its
respective terms, and, upon the issuance of the Schuller Notes
pursuant to Section 2.01
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and on the Repurchase Date, the Indenture and the Schuller Notes and
each of the other Related Agreements to which Schuller is a party will
have been duly authorized, executed and delivered by Schuller and will
constitute valid and binding obligations of Schuller, enforceable
against Schuller in accordance with its respective terms, except to
the extent that such enforceability is limited by bankruptcy,
insolvency, moratorium or similar laws relating to the enforcement of
creditors' rights generally and by the availability of equitable
remedies of general applicability;
(c) neither (i) the execution and delivery by the
Company of this Agreement and the Related Agreements to which the
Company is a party, the consummation by the Company of the
transactions contemplated hereby or thereby, and compliance by the
Company with the terms and conditions hereof or thereof, nor (ii) the
execution and delivery by Schuller of the Related Agreements to which
Schuller is a party, the issuance by Schuller of the Schuller Notes
under the Indenture, the consummation by Schuller of the transactions
(including, without limitation, the Schuller Recapitalization)
contemplated hereby or thereby, and compliance by Schuller with the
terms and provisions hereof or thereof, will (1) conflict with or
result in a breach of, or constitute a default under, any of the
terms, obligations, covenants, conditions or provisions of (i) any
indenture, mortgage, deed of trust, pledge, bank loan or credit
agreement, or other agreement or instrument to which the Company,
Schuller or any of their respective Subsidiaries is a party or by
which any of them or their respective properties may be bound or
affected or (ii) the certificate of incorporation or by-laws (or
similar constitutional documents) of the Company, Schuller or their
respective Subsidiaries; (2) conflict with or result in a breach of
any of the terms, conditions or provisions of any statute, judgment,
order, writ, injunction, decree, demand, rule or regulation of any
Governmental Agency; or (3) result in the creation or imposition of
any Lien upon any property or asset of the Company, Schuller or any of
their respective Subsidiaries under the terms or provisions of any of
the foregoing, except, in the case of clause (1)(i), (2) and (3), for
such conflict, breach, default or lien which would not (x) in the case
of the Company, have a material adverse effect on the Company and its
Subsidiaries taken as a whole or (y) in the case of Schuller, have a
material adverse effect on Schuller and its Subsidiaries taken as a
whole. Neither the Company, nor Schuller nor any of their respective
Subsidiaries (i) is in default (or would, with the giving of notice or
lapse of time or both, be in default) in the performance,
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observance or fulfillment of any of the terms, obligations, covenants,
conditions or provisions contained in any indenture or other agreement
creating, evidencing or securing indebtedness of the Company, Schuller
or any of their respective Subsidiaries or pursuant to which any such
indebtedness is issued, or other agreement or instrument to which the
Company, Schuller or any of their respective Subsidiaries is a party
or by which the Company, Schuller or any of their respective
Subsidiaries or their respective properties may be bound or affected,
except for such default which would not (x) in the case of the Company
and its Subsidiaries (other than Schuller and its Subsidiaries), have
a material adverse effect on the Company and its Subsidiaries taken as
a whole or (y) in the case of Schuller and its Subsidiaries, have a
material adverse effect on Schuller and its Subsidiaries taken as a
whole, or (ii) is in violation of any term of its certificate of
incorporation or by-laws (or similar constitutional documents);
(d) Schuller and its Subsidiaries are duly and
validly organized and existing corporations in good standing under the
laws of their respective jurisdictions of incorporation and are duly
licensed or qualified and in good standing as foreign corporations in
all other jurisdictions where the ownership or leasing of property or
the nature of business transacted makes such qualification necessary,
except where failure to do so would not have a material adverse effect
on Schuller and its Subsidiaries, taken as a whole, and have the
corporate power to own their respective properties and assets, and to
carry on their respective businesses, all as, and in the places where,
such properties and assets are now owned or operated or such
businesses are now conducted;
(e) Schedule I correctly lists as to Schuller and
each Subsidiary of Schuller on the date of this Agreement (1) its
name, (2) the jurisdiction of its incorporation, (3) for each class of
its capital stock, the percentage of the issued and outstanding shares
owned by the Company or Schuller or any other Subsidiary of either
(specifying such other Subsidiary) and (4) any rights, warrants or
options to acquire or purchase any shares of capital stock of Schuller
or such Subsidiary of Schuller or any securities or obligations
convertible into or exchangeable for any such shares. All of the
shares of stock of Schuller and its Subsidiaries owned by the Company,
Schuller or any Subsidiary of either have been duly issued and are
fully paid and nonassessable, and are so owned beneficially and of
record free and clear of any Lien;
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(f) the financial statements consisting of:
(i) the consolidated balance sheets of Schuller and
its Subsidiaries as at the end of each of the last two fiscal
years of the Company ended December 31, 1993, and the
consolidated statements of income, consolidated statements of
shareholder's equity and consolidated statements of cash flows
for each of the last three fiscal years of the Company ended
December 31, 1993, including in each case the related
schedules and notes, all certified by Coopers & Lybrand,
independent certified public accountants, and
(ii) the consolidated balance sheet of Schuller and
its Subsidiaries as at June 30, 1994 (including pro forma
liabilities and shareholder's equity reflecting the
transactions described in Note 9 thereof), and the
consolidated statement of income and consolidated statement of
cash flows for the six months then ended, all certified by the
chief financial officer of Schuller,
true and complete copies of which are attached hereto in Schedule II, were
prepared in accordance with GAAP consistently applied throughout the relevant
periods involved, except as specified therein (subject, in the case of the
interim statements referred to in clause (ii), to normal year-end audit
adjustments) and fairly present the consolidated financial position of Schuller
and its Subsidiaries as at such respective dates and the consolidated results
of operations and consolidated cash flows of Schuller and its Subsidiaries for
each such fiscal year and for such interim period.
(g) except as disclosed in filings by the Company with the
Commission, there are no actions, suits or proceedings (whether or not
purportedly on behalf of the Company or a Subsidiary) pending or, to the
knowledge and belief of the Company, threatened (or, to the knowledge and
belief of the Company, any investigations pending or threatened) against or
affecting the Company or Schuller or any of their Subsidiaries, or the
business, operations, properties or assets of the Company or Schuller or any of
their Subsidiaries, or before or by any Governmental Agency, which, either
singly or in the aggregate, are reasonably likely to result in any material
adverse change in the business, operations, properties or assets, or the
condition, financial or otherwise, of Schuller and its Subsidiaries, taken as a
whole, or in the ability of the Company to perform its obligations under this
Agreement or the Related Agreements to which the Company is a party or the
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ability of Schuller to perform its obligations under the Schuller Notes or the
other Related Agreements to which Schuller is a party. Neither the Company nor
Schuller nor any of their Subsidiaries is, to the knowledge and belief of the
Company, in default with respect to any statute, judgment, order, writ,
injunction, decree, demand, rule or regulation of any Governmental Agency,
default under which would be reasonably likely to have consequences which would
materially and adversely affect the business, operations, properties or assets
or the condition, financial or otherwise, of Schuller and its Subsidiaries,
taken as a whole, or the ability of the Company to perform its obligations
under this Agreement or the Related Agreements to which the Company is a party
or the ability of Schuller to perform its obligations under the Schuller Notes
or the other Related Agreements to which Schuller is a party;
(h) since December 31, 1993, (i) there has been no material
adverse change in the financial condition of Schuller and its Subsidiaries
taken as a whole and (ii) there has been no dividend or distribution of any
kind declared, paid or made by Schuller on its capital stock, or any issuance
of capital stock, other than with respect to the Schuller Recapitalization;
(i) Except for the Schuller Notes and the Demand Note, (x)
Schuller has no outstanding Debt on the date hereof and (y) the total amount of
Debt of Schuller and its Subsidiaries on the date hereof does not exceed $10
million;
(j) no Event of Default, or event or condition which would
constitute an Event of Default after notice or lapse of time or both, has
occurred and is continuing under the Bond Prepayment Agreement and no default
has occurred and is continuing under either of the Bonds;
(k) there is no Event of Default, or event or condition which
would constitute an Event of Default after notice or lapse of time or both,
under the Indenture or the Schuller Notes;
(l) the Schuller Notes will constitute direct, unconditional
and unsubordinated general obligations of Schuller, and upon the issuance of
the Schuller Notes pursuant to Section 2.01 and on and at all times prior to
and as of the Repurchase, Schuller will have no Senior Indebtedness (as defined
in the Indenture) other than the Schuller Notes and the Demand Note. The
Demand Note does not rank senior in right of payment to the Schuller Notes;
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(m) upon the issuance of the Schuller Repurchase Notes
pursuant to Section 2.01 and on and at all times prior to the Repurchase, the
Company will have good and valid title to the Schuller Repurchase Notes, free
and clear of all Liens, and, upon delivery of the Schuller Repurchase Notes to
the Trust in payment for the Company's repurchase of the Bonds, the Trust will
have good and valid title to the Schuller Repurchase Notes, free and clear of
all Liens;
(n) neither the Company nor Schuller nor any Person acting on
either of their behalf has, directly or indirectly, offered or agreed to
transfer any Schuller Notes or any similar security to, or has solicited any
offer to acquire any Schuller Notes or any similar security from, or otherwise
has negotiated in respect of the Schuller Notes or any similar security with,
any Person other than the Trust. Except for any actions that may have been
taken by the Trust or any actions taken in accordance with this Agreement,
neither the Company, Schuller nor any Person acting on behalf of the Company or
Schuller has taken, directly or indirectly, any action which would bring the
offering, sale or delivery of the Schuller Repurchase Notes to the Trust within
the registration provisions of the Securities Act;
(o) attached hereto as Exhibit L is a true and complete copy
of an opinion of American Appraisal Associates regarding the solvency of
Schuller and its Subsidiaries; and
(p) attached hereto as Exhibit M are true and complete copies
of the Certificate of Incorporation and the By-Laws of Schuller as currently in
full force and effect.
SECTION 4.02. Representations and Warranties of the Trust.
The Trust represents and warrants to the Company on the date hereof and as of
the Repurchase that:
(a) the Trust has been duly organized and is validly
existing as a trust under the laws of the State of New York;
(b) neither the execution and delivery of this
Agreement, the consummation of the transactions contemplated by it,
nor compliance by the Trust with its terms and conditions, will (1)
conflict with or result in a breach of, or constitute a default under,
any of the terms, obligations, covenants, conditions or provisions of
(i) any indenture, mortgage, deed of trust, pledge, bank loan or
credit agreement, or other agreement or instrument to which the Trust
is now a party or by which it may be bound or affected or (ii)
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the Trust Agreement (as amended pursuant to the Seventh Amendment to
the Trust Agreement); or (2) conflict with or result in a breach of
any of the terms, conditions or provisions of any judgment, order,
writ, injunction, decree or demand of any Governmental Agency, except,
in the case of clauses (1) and (2), for such conflict, breach or
default which would not have a material adverse effect on the Trust;
(c) this Agreement has been duly authorized,
executed and delivered by the Trust and constitutes a valid and
binding agreement of the Trust, enforceable against the Trust in
accordance with its terms;
(d) on the Repurchase Date, the Trust will have good
and valid title to the Bonds, free and clear of all Liens, other than
any remainderman or reversionary interests of the PD Trust or the
Company therein and any Liens or claims created by or arising in favor
of the Company; and
(e) the Trust (i) has had access to such financial
and other information concerning Schuller as it has deemed necessary
in connection with its decision to purchase Schuller Notes on the
Repurchase Date, (ii) is aware that the Schuller Notes to be
transferred to the Trust in connection with the Repurchase and the
Second Bond Repurchase pursuant to this Agreement have not been (and,
as of the time of each such transfer, will not be) registered under
the Securities Act, as such transfers are intended by the Company to
be exempt from the registration requirements of Section 5 of the
Securities Act pursuant to Section 4(2) thereof, (iii) is an
"accredited investor" as such term is defined in Rule 501 under the
Securities Act, and (iv) is acquiring such Schuller Notes for its own
account and not for resale except pursuant to the registration
requirements of the Securities Act or an exemption therefrom.
ARTICLE V
CALCULATION OF CERTAIN AMOUNTS
SECTION 5.01. Calculation of Initial Repurchase Amount,
Adjusted Repurchase Amount, Adjusted Repurchase and Interest Amount, Second
Bond Repurchase Amount and Principal Amount of Second Bond Repurchase Notes.
(a) The Trust shall calculate the Initial Repurchase Amount, the Adjusted
Repurchase Amount, the Adjusted Repurchase and Interest Amount and the Second
Bond Repurchase Amount in accordance with the respective definitions of such
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terms and by determining the Current Net Present Value of the Bonds and/or the
Second Bond (as the case may be) in accordance with Section 5.01(b). The Trust
shall also calculate the principal amount of the Second Bond Repurchase Notes
in accordance with Section 6.01. Upon the determination of the Initial
Repurchase Amount, the Adjusted Repurchase Amount, the Adjusted Repurchase and
Interest Amount, the Second Bond Repurchase Amount or the principal amount of
the Second Bond Repurchase Notes, the Trust shall promptly provide the Company
with a certificate from the Trust's Chief Financial Officer or Controller,
stating such amount and the calculations made to achieve such result. If any
dispute arises under this Section 5.01, the parties shall follow the dispute
resolution procedures set forth in Section 5.02. All calculations hereunder
shall be made on the basis of 360-day years of twelve 30-day months, and actual
days remaining in any partial month assuming such partial month has 30 days.
(b) The Current Net Present Value of the Bond, the Original
Bond or the Second Bond shall be determined as follows:
(i) each then unpaid Payment Amount under the Bond, the
Original Bond or the Second Bond (as the case may be) shall be
separately discounted to present value as follows (provided, however,
that for purposes of this Section 5.01(b)(i), the Payment Amount due
on August 31, 1994 under the Bond shall not be included in determining
the Current Net Present Value of the Bond and the Payment Amount due
on August 31, 1995 under the Bond shall be deemed to be equal to
$20,233,013): (A) the number of whole months ("WM") and actual days
remaining in any partial month (based on a thirty-day month) ("AD")
between the date as of which such calculation is being made and the
scheduled date of payment of such Payment Amount shall be determined
and (B) the discounted value ("DV") of such Payment Amount shall be
calculated using the following formula:
PA
DV = ------------------------
3*ADR
(1 + -----)(insertion symbol)NMP
4
where PA = such Payment Amount,
ADR = the Applicable Discount Rate, and
NMP = the number of nine month periods calculated
as follows:
NMP = ( (WM * 30) + AD) / 270
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and
(ii) the then Current Net Present Value shall equal the sum of
the DVs of all such Payment Amounts.
(c) As examples of the calculations referred to in this
Section 5.01, and for illustrative purposes only:
(1) Assuming that (i) the Repurchase Date is
September 20, 1994, (ii) the Initial Market Rate is 10.50%, (iii) the
Adjusted Market Rate is 11%, (iv) the Applicable Discount Rate
determined using the Adjusted Market Rate is 11.75%, (v) the Second
Bond Repurchase Date is October 15, 1994 and (vi) the consummation
date of the first Offering by the Trust is November 15, 1994, the
Initial Repurchase Amount would be $378,783,281, the Second Bond
Repurchase Amount would be $18,285,081, the principal amount of the
Second Bond Repurchase Notes would be $18,152,749, the Adjusted
Repurchase Amount would be $384,995,284 and the Adjusted Repurchase
and Interest Amount would be $391,337,639.
(2) With the same assumptions as in Example (1)
except that the Second Bond Repurchase Date is assumed to be December
15, 1994, the Second Bond Repurchase Amount would be $17,034,314, the
principal amount of the Second Bond Repurchase Notes would be
$16,879,625, the Adjusted Repurchase Amount would be $368,277,688 and
the Adjusted Repurchase and Interest Amount would be $374,466,799.
SECTION 5.02. Dispute Resolution. All disputes and
disagreements subject to resolution pursuant to the terms of this Section 5.02
shall be resolved by agreement of two nationally recognized investment banking
firms, one selected by the Company and one selected by the Trust. If such
investment banking firms do not agree on the resolution of such matters within
five Business Days, then they shall within five Business Days thereafter select
a third Independent nationally recognized investment banking firm which shall
resolve such dispute within ten Business Days of its appointment and whose
determination shall be final and binding. If such investment banking firms
fail to appoint such third investment banking firm within such five Business
Day period, then either the Company or the Trust, on behalf of both, may
request such appointment by the then President of the Association of the Bar of
the City of New York (or any successor organization thereto) or, in his
absence, failure, refusal or inability to act, then either the Company or the
Trust may, on behalf of both, apply
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to the American Arbitration Association (or any successor organization thereto)
in New York, New York for the appointment of such third investment banking
firm.
ARTICLE VI
PROVISIONS RELATING TO SECOND BOND
SECTION 6.01. Prepayment or Repurchase of Second Bond. (a)
Subject to obtaining the prior written consent, waiver or approval (in a form
reasonably acceptable to each of the Trust and the Company) of all Persons
(other than the parties to this Agreement) whose consent is required, in the
reasonable judgment of either the Trust or the Company, under any provision of
applicable law, any judicial order or decree or any material agreement or
instrument binding upon the Company or any of its Subsidiaries or upon the
Trust, or to the elimination of such consent requirement(s) with respect to the
Second Bond, the Trust shall have the right to cause the Company, at the
Trust's option exercisable by notice to the Company, at any time during the
Adjustment Period, to repurchase the Second Bond on the date (the "Second Bond
Repurchase Date") designated in the Trust's notice, which shall not be less
than five Business Days after the date on which such notice is received by the
Company, with Schuller Notes in a principal amount which, when added to the
accrued but unpaid interest on such Schuller Notes as of the Second Bond
Repurchase Date, equals the Second Bond Repurchase Amount (the "Second Bond
Repurchase Notes"). The Trust's notice given pursuant to this Section 6.01(a)
shall also set forth the Second Bond Repurchase Amount and the principal amount
of the Second Bond Repurchase Notes.
(b) On the Second Bond Repurchase Date, the Company shall
deliver the Second Bond Repurchase Notes to the Trust, duly endorsed for
transfer to the Trust in accordance with the terms of the Indenture and free
and clear of all Liens and adverse claims, together with
(i) an Officer's Certificate from the Company to the effect
that (1) the representations and warranties of the Company contained
in this Agreement are true and correct in all material respects at and
as of such date (any references in such representations and warranties
to Schuller Repurchase Notes being deemed to be references to the
Second Bond Repurchase Notes), (2) any consents required to be
obtained by the Company or Schuller necessary for the transactions
contemplated by this Section 6.01 have been obtained, and (3) there
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is no default or event of default under any of the Schuller Notes or
the Indenture; and
(ii) an opinion of the General Counsel of the Company and
Schuller, dated the Second Bond Repurchase Date, covering the matters
referred to in the following paragraphs of the form of opinion
attached as Exhibit K hereto: (a) paragraphs 10 and 15, in each case
only with respect to the Second Bond Repurchase Notes and (b)
paragraphs 3, 5, 7, 9, 12, 13 and 14, in each case with respect to the
Second Bond Repurchase Notes and the Amended and Restated Indenture
(if the same shall have been entered into as of such date) or any
other supplement or amendment to the Indenture (other than the
Indenture Supplement) then in effect or to be entered into on the
Second Bond Repurchase Date, which opinion shall contain only the
limitations, qualifications or assumptions set forth in Exhibit K with
respect to the matters covered in the aforesaid paragraphs thereof
and/or such other limitations, qualifications or assumptions as are
reasonably acceptable to the Trust.
(c) On the Second Bond Repurchase Date, the Trust shall
deliver the Second Bond free and clear of all Liens and adverse claims (other
than Liens or claims created by, or arising in favor of, the Company) to the
Company for cancellation, together with
(i) a certificate signed by an authorized executive officer of
the Trust to the effect that (1) the representations and warranties of
the Trust contained in this Agreement are true and correct in all
material respects at and as of such date (any references in such
representations and warranties to the Bond or the Original Bond being
deemed to be references to the Second Bond), and (2) any consents
required to be obtained by the Trust necessary for the transactions
contemplated by this Section 6.01 have been obtained; and
(ii) an opinion of the General Counsel of the Trust, dated the
Second Bond Repurchase Date, covering the matters referred to in the
following paragraphs of the form of opinion attached as Exhibit J
hereto: paragraph 1 only with respect to the transactions
contemplated by this Section 6.01 and paragraph 5 only with respect to
the Second Bond, which opinion shall contain only the limitations,
qualifications and assumptions set forth in Exhibit J with respect to
the matters covered in the aforesaid paragraphs thereof and/or such
other limitations, qualifications or assumptions as are reasonably
acceptable to the Company.
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(d) If, at the time that the Trust gives the notice referred
to in Section 6.01(a), neither the Trust nor the Company has given notice of
the Second Bond Reserve Amount pursuant to Section 2.03(b)(ii), and if, at the
time that the Company receives the Trust's notice given pursuant to Section
6.01(a), the Company is holding an insufficient aggregate principal amount of
Schuller Notes to permit the Company to repurchase the Second Bond with the
Second Bond Repurchase Notes in accordance with the terms of this Section 6.01,
the Company and the Trust each agree, if the Indenture Supplement is then in
effect, to execute and to cause to be delivered to the Indenture Trustee a
joint written request pursuant to Section 5 of the Indenture Supplement that
Schuller issue additional senior notes under the Indenture on terms identical
to the Schuller Notes to the Company in the aggregate principal amount equal to
the amount of such insufficiency. The Company shall cause Schuller to issue
such additional senior notes to the Company on or prior to the Second Bond
Repurchase Date. Upon their issuance, such further senior notes shall become
Schuller Notes for all purposes of this Agreement and the Indenture.
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. Amendments; Waivers. This Agreement may be
modified, supplemented or amended at any time and from time to time only by a
writing signed by each party hereto. Any waiver or consent granted in respect
of any term or condition of this Agreement shall be effective only if given in
a writing signed by the party giving same and expressly stating that it is a
waiver or consent, and any such waiver or consent shall constitute a waiver or
consent only of the specific provision(s) and for the specific purpose(s) set
forth therein.
SECTION 7.02. Termination; Termination of Bond Prepayment
Agreement. The Trust shall have the right to terminate this Agreement, without
liability or obligation to the Company or Schuller, by giving written notice of
termination to the Company at any time prior to the Repurchase. Effective upon
the Repurchase, all of the representations, warranties, covenants and other
agreements contained in the Bond Prepayment Agreement shall terminate and be of
no further force and effect; provided, however, that the termination of any
provision of the Bond Prepayment Agreement shall not relieve either party
thereto of liability for breach of such provision prior to its termination.
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SECTION 7.03. Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including facsimile
transmission or similar writing) and shall be given:
if to the Trust, to:
Manville Personal Injury Settlement Trust
8260 Willow Oaks Corporate Drive, Suite 600
P.O. Box 10415
Fairfax, Virginia 22031
Fax: (703) 205-6249
Attention: David T. Austern, Esq.
with a copy to:
Donovan Leisure Newton & Irvine
30 Rockefeller Plaza
New York, New York 10112
Fax: (212) 632-3321
Attention: Andrew J. Trubin, Esq.
if to the Company, to
Manville Corporation
717 17th Street
Denver, Colorado 80202
Fax: (303) 978-4842
Attention: Richard B. Von Wald, Esq.
if to Schuller, to
Schuller International Group, Inc.
717 17th Street
Denver, Colorado 80202
Fax: (303) 978-4842
Attention: Richard B. Von Wald, Esq.
in each case, with copies to:
Skadden, Arps, Slate, Meagher & Flom
919 Third Avenue
New York, New York 10022
Fax: (212) 735-2001
Attention: Franklin M. Gittes, Esq.
and
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Davis Polk & Wardwell
450 Lexington Avenue
New York, New York 10017
Fax: (212) 450-4800
Attention: Diane G. Kerr, Esq.
and
Kaye, Scholer, Fierman, Hays & Handler
425 Park Avenue
New York, New York 10022
Fax: (212) 836-8689
Attention: Herbert S. Edelman, Esq.
SECTION 7.04. Counterparts; Integration. This Agreement may
be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement together with its exhibits constitutes the entire
agreement and understanding among the parties hereto relating to the subject
matter hereof and supersedes any and all prior agreements and understandings,
oral or written, relating to the subject matter hereof.
SECTION 7.05. Severability. Should any provision in this
Agreement be determined to be invalid or unenforceable in any jurisdiction,
such determination shall in no way limit or affect the validity or
enforceability and operative effect of any other provisions of this Agreement
or affect the validity or enforceability of any of the provisions of this
Agreement in any other jurisdiction.
SECTION 7.06. Headings. The headings used in this Agreement
are inserted for convenience only and neither constitute a portion of this
Agreement nor in any manner affect the construction of the provisions of this
Agreement.
SECTION 7.07. Successors and Assigns. The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns, except that neither the Company
nor the Trust may assign or otherwise transfer any of its rights or delegate
obligations under this Agreement; provided, however, that if the Trust shall
terminate its existence in accordance with the provisions of Section 7.02(a) of
the Trust Agreement prior to the termination of this Agreement, all
then-remaining right, title and interest of the Trust in the Schuller
Repurchase Notes and hereunder shall be transferred and
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assigned, subject to the terms and conditions of this Agreement, to (a) the PD
Trust if the PD Trust is then in existence or (b) the Company or any designees
of the Company if the PD Trust is not then in existence, and the Trust and the
Company agree to execute and deliver, or cause to be executed and delivered,
such agreements, instruments and other documents as may be necessary or
advisable to implement the foregoing.
SECTION 7.08. Assumption by Schuller or Affiliate. In the
event that the Company or Schuller intends to engage in a transaction or series
of transactions pursuant to which the Company will no longer own, directly or
indirectly, at least 80% of each class of capital stock of Schuller, the
Company shall cause Schuller, prior to the consummation of such transaction or
transactions, to enter into an agreement with the Trust pursuant to which
Schuller will agree to undertake, assume and perform all the obligations of the
Company under this Agreement (it being understood that obligations requiring
the Company to cause Schuller to take action will be assumed by Schuller as
direct obligations of Schuller to take such action). In the event that
Schuller's obligations under the Indenture and the Schuller Notes are assumed
or are to be assumed by an Affiliate of Schuller or the Company (regardless of
whether Schuller remains liable as a joint obligor thereunder), this Agreement
shall remain in full force and effect, and all references in this Agreement to
the term "Schuller" shall be deemed to be references to such Affiliate
(including, without limitation, for purposes of the first sentence of this
Section 7.08, it being agreed that the Company shall, or shall cause Schuller
to, cause such Affiliate to enter into an agreement with the Trust as described
in such sentence), and all references to the Schuller Notes and the Indenture
shall be deemed to be references to the Schuller Notes and Indenture as assumed
by such Affiliate and to any replacement or supplemental securities, indentures
or other instruments issued or entered into by such Affiliate in connection
with its assumption of the Schuller Notes and the Indenture.
SECTION 7.09. Survival of Representations and Warranties. The
representations and warranties of the parties contained in this Agreement shall
survive the consummation of the Repurchase for a period of 18 months from the
Repurchase Date.
SECTION 7.10. Expenses. Except as otherwise provided herein,
(i) all costs and expenses incurred in connection with this Agreement,
including without limitation all brokers' fees, investment banking fees and
legal fees, shall be paid by the party
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incurring such cost or expense; provided that the fees and expenses incurred in
connection with any third Independent investment banking firm (and its counsel,
if any) referred to in Section 5.02 shall be paid equally by the Company and
the Trust. Nothing in this Section 7.10 shall be construed as creating an
obligation of the Trust to indemnify any Person.
SECTION 7.11. Specific Performance. Each of the Company and
the Trust agrees that the other party would be irreparably damaged if for any
reason the Company or the Trust, as the case may be, failed to perform its
obligations under this Agreement and that such other party would not have an
adequate remedy at law for money damages in such event. Accordingly, the
Company and the Trust each agrees that the other party shall, to the maximum
extent permitted, be entitled to specific performance and injunctive and other
equitable relief to enforce the performance of this Agreement. This provision
is without prejudice to any other rights that the Company or the Trust may have
against the other party for any failure of such other party to perform its
obligations hereunder.
SECTION 7.12. Third Parties. This Agreement constitutes an
agreement solely between the parties hereto, and is not intended to and shall
not confer any rights, remedies, obligations or liabilities, legal or
equitable, on any Person other than the parties hereto and their respective
successors or assigns, or otherwise constitute any Person a third-party
beneficiary under or by reason of this Agreement.
SECTION 7.13. Governing Law; Submission to Jurisdiction. This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York, without regard to choice of law principles applied in such
jurisdiction. The Company and the Trust hereby submit to the nonexclusive
jurisdiction of the United States District Courts for the Southern and Eastern
Districts of New York and of any New York State court sitting in New York City
for purposes of all legal proceedings arising out of or relating to this
Agreement or the transactions contemplated hereby. Each of the Company and the
Trust irrevocably waives, to the fullest extent permitted by law, any objection
which it may now or hereafter have to the laying of the venue of any such
proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient forum.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.
MANVILLE CORPORATION
By /s/ Richard B. Von Wald
Name: Richard B. Von Wald
Title: Senior Vice President,
General Counsel and Secretary
MANVILLE PERSONAL INJURY
SETTLEMENT TRUST
By /s/ David T. Austern
Name: David T. Austern
Title: General Counsel and Secretary
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Index of Exhibits and Schedules
<TABLE>
<S> <C>
Exhibit A Form of Demand Note
Exhibit B-1 Form of Indenture
Exhibit B-2 Form of Indenture Supplement
Exhibit C Form of Second Amendment to the Supplemental Agreement
Exhibit D Form of Seventh Amendment to the Trust Agreement
Exhibit E Form of Intercompany Agreement
Exhibit F Form of Treasury Management Agreement
Exhibit G Form of Tax Sharing Agreement
Exhibit H Form of Corporate Agreement
Exhibit I Form of Agreement with the Trust
Exhibit J Form of Opinion of General Counsel of the Trust
Exhibit K Form of Opinion of General Counsel of the Company and
Schuller
Exhibit L Solvency Opinion of American Appraisal Associates
Exhibit M Certificate of Incorporation and By-Laws of Schuller
Schedule I Stock Ownership and Certain Other Information Concerning
Schuller and its Subsidiaries
Schedule II Financial Statements of Schuller
</TABLE>
(The Registrant undertakes to file copies of these
exhibits to the Commission upon request).
