Document/Exhibit Description Pages Size
1: 10-K Railamerica 12/31/1999 87 428K
2: EX-4.4 Warrant Agreement 25 77K
3: EX-4.5 Asset Bridge Warrant Agreement 26 77K
4: EX-10.71 Credit Agreement 141 517K
5: EX-10.72 Securities Purchase Agreement 62 236K
6: EX-10.73 Asset Bridge Securities Purchase Agreement 58 206K
7: EX-10.74 Equity Registration Rights Agreement 13 44K
8: EX-10.75 Debt Registration Rights Agreement 23 77K
9: EX-10.76 Asset Bridge Equity Registration Rights Agreement 13 44K
10: EX-21.1 Subsidiaries of Registrant 2 12K
11: EX-23.1 Consent of Pricewaterhousecoopers LLP 1 7K
12: EX-23.2 Consent of Arthur Andersen Langton Clarke 1 8K
13: EX-27 Financial Data Schedule 1 8K
EX-10.73 — Asset Bridge Securities Purchase Agreement
Exhibit Table of Contents
[EXECUTION COPY]
Exhibit 10.73
ASSET BRIDGE SECURITIES PURCHASE AGREEMENT,
dated as of
February 4, 2000,
among
PALM BEACH RAIL HOLDING, INC.,
RAILAMERICA, INC.,
and
THE GUARANTORS PARTY HERETO,
and
THE PURCHASERS PARTY HERETO.
PURCHASE AGREEMENT
TABLE OF CONTENTS
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Page
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ARTICLE I
DEFINITIONS
Section 1.1 Definitions..........................................................................1
Section 1.2 Incorporated Definition..............................................................9
ARTICLE II
PURCHASE AND SALE OF SECURITIES; TERMS OF SECURITIES
Section 2.1 Commitment to Purchase...............................................................9
Section 2.2 Takedown Procedures..................................................................9
Section 2.3 Fees................................................................................10
Section 2.4 Mandatory Termination of Commitments................................................10
Section 2.5 Interest............................................................................10
Section 2.6 Maturity of Asset Bridge Notes; Prepayment of Asset Bridge Notes....................11
Section 2.7 Taxes...............................................................................13
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF
HOLDINGS, INTERMEDIATE HOLDINGS AND THE COMPANY
Section 3.1 Incorporation of Representations and Warranties in Incorporated
Agreement.......................................................................16
Section 3.2 Authorization, Execution and Enforceability.........................................17
Section 3.3 Capitalization......................................................................17
Section 3.4 Solicitation........................................................................17
Section 3.5 Non-fungibility.....................................................................18
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PURCHASERS
Section 4.1 Purchase for Investment; Authority; Binding Agreement...............................18
ARTICLE V
CONDITIONS PRECEDENT TO PURCHASE
Section 5.1 Conditions to Purchasers' Obligation at Takedown....................................19
Section 5.2 Conditions to the Intermediate Holdings Obligations.................................26
ARTICLE VI
COVENANTS
Section 6.1 Incorporation of Affirmative Covenants from the Incorporated
Agreement.......................................................................27
Section 6.2 Incorporation of Negative Covenants from the Incorporated
Agreement.......................................................................27
Section 6.3 Investment Company Act..............................................................29
Section 6.4 Use of Proceeds.....................................................................29
Section 6.5 Copies of Documents and Notices.....................................................29
Section 6.6 Syndication Efforts.................................................................30
ARTICLE VII
EVENTS OF DEFAULT
Section 7.1 Events of Default Defined; Acceleration of Maturity; Waiver of
Default.........................................................................30
ARTICLE VIII
LIMITATION ON TRANSFERS
Section 8.1 Restrictions on Transfer............................................................32
Section 8.2 Restrictive Legends.................................................................32
Section 8.3 Notice of Proposed Transfers........................................................33
Section 8.4 Right to Sell, Transfer or Assign Asset Bridge Notes................................34
Section 8.5 Replacement Asset Bridge Notes......................................................34
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ARTICLE IX
COLLATERAL AGENT
Section 9.1 Actions.............................................................................34
Section 9.2 Exculpation.........................................................................35
Section 9.3 Successor...........................................................................35
Section 9.4 Asset Bridge Notes held by the Collateral Agent.....................................36
Section 9.5 Credit Decisions....................................................................36
Section 9.6 Reliance by the Collateral Agent....................................................36
Section 9.7 Defaults............................................................................36
Section 9.8 Payment of Costs and Expenses.......................................................37
Section 9.9 Indemnification.....................................................................37
ARTICLE X
GUARANTEES
Section 10.1 Guarantees..........................................................................39
Section 10.2 Limitation on Guarantor Liability...................................................41
Section 10.3 Consolidation or Merger of Guarantors...............................................41
ARTICLE XI
MISCELLANEOUS
Section 11.1 Notices.............................................................................41
Section 11.2 No Waivers; Amendments..............................................................41
Section 11.3 Indemnification.....................................................................42
Section 11.4 Expenses............................................................................44
Section 11.5 Payment.............................................................................44
Section 11.6 Successors and Assigns..............................................................45
Section 11.7 Brokers.............................................................................45
Section 11.8 New York Law; Submission to Jurisdiction; Waiver of Jury Trial......................45
Section 11.9 Severability........................................................................45
Section 11.10 Counterparts........................................................................45
Section 11.11 Confidentiality.....................................................................46
Section 11.12 Survival of Representations and Warranties..........................................46
Section 11.13 Construction........................................................................46
Section 11.14 Integration.........................................................................46
Section 11.15 Replacement Asset Bridge Notes......................................................47
Section 11.16 Headings............................................................................47
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SCHEDULES
Schedule 3.3 Capitalization of Holdings
ANNEX
Annex I Corporate and Capital Structure
EXHIBITS
Exhibit A Form of Asset Bridge Escrow Agreement
Exhibit B Form of Asset Bridge Note
Exhibit C Form of Asset Bridge Equity Registration Rights Agreement
Exhibit D Form of Asset Bridge Warrant Agreement
Exhibit E Form of Asset Bridge Pledge and Security Agreement
Exhibit F Form of Issuance Date Certificate
Exhibit G Form of Solvency Certificate
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SECURITIES PURCHASE AGREEMENT
THIS AGREEMENT, dated as of February 4, 2000, is made by and among PALM
BEACH RAIL HOLDING, INC., a Delaware corporation ("INTERMEDIATE HOLDINGS"),
RAILAMERICA, INC., a Delaware corporation ("HOLDINGS"), each Designated
Restricted Subsidiary of Intermediate Holdings that is a party hereto as a
"Guarantor" (collectively, the "GUARANTORS"), the Persons parties hereto as
"Purchasers" (collectively, the "PURCHASERS").
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 DEFINITIONS. The following terms, as used herein (including
as used in any provision of the Incorporated Agreement that has been
incorporated by reference herein), have the following meanings:
"ADDITIONAL ASSET BRIDGE NOTES" means Asset Bridge Notes issued in
satisfaction of Intermediate Holdings' obligations to pay interest on the
outstanding Asset Bridge Notes in accordance with the terms hereof.
"ADMINISTRATIVE AGENT" is defined in the definition of the term "Credit
Agreement".
"AGREEMENT" means this Agreement, as amended, supplemented or otherwise
modified from time to time in accordance with its terms.
"ASSET BRIDGE EQUITY REGISTRATION RIGHTS AGREEMENT" means the Asset
Bridge Equity Registration Rights Agreement, dated as of February 4, 2000, among
Holdings and the Purchasers, in the form attached as Exhibit C to this
Agreement, as amended, supplemented or otherwise modified from time to time.
"ASSET BRIDGE ESCROW AGREEMENT" means the Asset Bridge Escrow
Agreement, dated as of February 4, 2000, among Holdings, the Purchasers and the
Escrow Agent, in the form attached as Exhibit A to this Agreement, as amended,
supplemented or otherwise modified from time to time.
"ASSET BRIDGE NOTES" means Intermediate Holdings' Asset Bridge Senior
Secured Increasing Rate Bridge Notes substantially in the form set forth as
EXHIBIT B hereto.
"ASSET BRIDGE PLEDGE AND SECURITY AGREEMENT" means the Asset Bridge
Pledge and Security Agreement executed and delivered by an Authorized Officer of
Intermediate Holdings and each Guarantor pursuant to CLAUSE (W) of SECTION 5.1,
substantially in the form of EXHIBIT E hereto, as amended, supplemented, amended
and restated or otherwise modified from time to time.
"ASSET BRIDGE WARRANT AGREEMENT" means the Asset Bridge Warrant
Agreement, dated as of February 4, 2000, among Holdings and the Purchasers in
the form attached as Exhibit D to this Agreement, as amended, supplemented or
otherwise modified from time to time.
"AUTHORIZED OFFICER" means, relative to any Obligor, those of its
officers, general parties or managing members (as applicable) whose signatures
and incumbency shall have been certified to the Purchasers and the Holders
pursuant to CLAUSE (A) of SECTION 5.1.
"BUSINESS DAY" means any day except a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law to
close.
"COLLATERAL AGENT" means Rail America Funding, Inc., in its capacity as
collateral agent for the Secured Parties and includes each other Person
appointed as the successor Collateral Agent pursuant to SECTION 9.3.
"COMMISSION" means the Securities and Exchange Commission.
"COMMITMENT" means, with respect to any Purchaser, the amount set forth
opposite its name on the signature pages hereto or the obligation of such
Purchaser to purchase Asset Bridge Notes hereunder in an aggregate principal
amount at any time outstanding not to exceed such amount.
"COMMON STOCK" means the authorized common stock, par value $.001 per
share, of Holdings.
"COMPANY" is defined in the definition of the term "Credit Agreement".
"CREDIT AGREEMENT" means the Credit Agreement, dated as of February 4,
2000, among RailAmerica Transportation Corp. (the "COMPANY"), Intermediate
Holdings, Holdings, Railink, Ltd., a corporation organized and existing under
the laws of the Province of Alberta, Canada, Freight Victoria Limited, a
corporation organized and existing under the laws of Australia, the lenders
party thereto, DLJ Capital Funding, Inc., as syndication agent for the lenders,
the lead arranger and the sole book running manager, The Bank of Nova Scotia, as
administrative agent (in such capacity, the "ADMINISTRATIVE AGENT") for the
lenders, and ING (U.S.) Capital LLC and Fleet National Bank, as documentation
agent for the lenders, as amended, modified, amended and restated, renewed,
refunded, replaced or refinanced from time to time, PROVIDED that (i) such
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refinancing or refunding has a final maturity date that is the same as or later
than the final maturity date of the Indebtedness being amended, modified,
amended and restated, renewed, refunded, replaced or refinanced, and (ii) the
principal amount thereof does not exceed $380,000,000, plus the amount of
reasonable expenses incurred in connection therewith (other than as a result of
currency fluctuations) less the amount of all principal repayments actually made
from time to time hereafter of term Indebtedness and permanent reductions of
revolving Indebtedness thereunder.
"DEBT INCURRENCE" means any incurrence by Holdings, Intermediate
Holdings or any of its Designated Restricted Subsidiaries of any Indebtedness,
other than Indebtedness permitted under CLAUSE (B) of SECTION 6.2.
"DEFAULT" means any Event of Default or any event or condition which,
with the giving of notice or lapse of time or both, would, unless cured or
waived, become an Event of Default.
"DESIGNATED RESTRICTED SUBSIDIARY" means Kalyn/Siebert.
"DOLLARS" or "$" mean lawful currency of the United States of America.
"ESCROW AGENT" means Snoga, Inc., a Delaware corporation.
"EVENT OF DEFAULT" has the meaning set forth in SECTION 7.1.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"EXPIRATION DATE" has the meaning set forth in SECTION 2.1(B).
"FEE LETTER" means the letter agreement with respect to fees dated
February 1, 2000 made by DLJ Bridge Finance, Inc. and DLJ Capital Funding, Inc
and accepted by Holdings on February 2, 2000.
"FINANCING DOCUMENTS" means this Agreement, the Asset Bridge Notes, the
Asset Bridge Equity Registration Rights Agreement, the Asset Bridge Warrant
Agreement, the Warrants and the Asset Bridge Escrow Agreement.
"FIRST ANNIVERSARY DATE" means the first anniversary of the Issuance
Date (or if such date is not a Business Day, the next preceding Business Day).
"GUARANTEE" means the guarantee by the Guarantors of the Asset Bridge
Notes pursuant to Article X.
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"GUARANTEE OBLIGATION" means as to any Person (the "guaranteeing
person"), any obligation of (a) the guaranteeing person or (b) another Person
(including, without limitation, any bank under any letter of credit) to induce
the creation of which the guaranteeing person has issued a reimbursement,
counter indemnity or similar obligation, in either case guaranteeing or in
effect guaranteeing any Indebtedness (the "primary obligations") of any other
third Person (the "primary obligor") in any manner, whether directly or
indirectly, including, without limitation, any obligation of the guaranteeing
person, whether or not contingent, (i) to purchase any such primary obligation
or any property constituting direct or indirect security therefor, (ii) to
advance or supply funds (1) for the purchase or payment of any such primary
obligation or (2) to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency of the primary
obligor or (iii) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation against loss in
respect thereof; PROVIDED, HOWEVER, that the term Guarantee Obligation shall not
include endorsements of instruments for deposit or collection in the ordinary
course of business. The amount of any Guarantee Obligation of any guaranteeing
person shall be deemed to be the lower of (a) an amount equal to the stated or
determinable amount of the primary obligation in respect of which such Guarantee
Obligation is made and (b) the maximum amount for which such guaranteeing person
may be liable pursuant to the terms of the instrument embodying such Guarantee
Obligation, unless such primary obligation and the maximum amount for which such
guaranteeing person may be liable are not stated or determinable, in which case
the amount of such Guarantee Obligation shall be such guaranteeing person's
maximum reasonably anticipated liability in respect thereof as determined in
good faith by the guaranteeing Person.
"GUARANTORS" is defined in the preamble.
"HOLDER" means any holder of any Asset Bridge Note.
"HOLDINGS" is defined in the preamble.
"INCORPORATED AGREEMENT" means the Credit Agreement; PROVIDED that any
amendment, supplement or waiver thereto or thereunder shall be effective for
purposes of this definition if and only if consented to in writing by the
Majority Holders. Each reference herein to the Incorporated Agreement shall by
such reference incorporate the provisions of the Incorporated Agreement to which
such reference is made as though fully set forth in such place, together with
related definitions and ancillary provisions, PROVIDED that for purposes of such
incorporation by reference, except as the context may otherwise require:
(i) references therein to "this Agreement", the "Notes", the
"Loan Documents" and the like shall be deemed to refer to and include
this Agreement, the Asset Bridge Notes and the Financing Documents,
respectively;
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(ii) references therein to the "Administrative Agent" shall be
deemed to refer to the Purchasers;
(iii) references therein to the "Lenders" shall be deemed to
refer to (x) prior to the issuance of the Asset Bridge Notes, the
Purchasers and (y) from and after the issuance of the Asset Bridge
Notes, the Holders from time to time of the Asset Bridge Notes;
(iv) references therein to the "Required Lenders" or the like
shall be deemed to refer to the Majority Holders;
(v) references therein to the "Obligors" shall be deemed to
refer to Holdings, Intermediate Holdings and the Guarantors;
(vi) references in Article VI thereof to the "Credit
Extensions" shall be deemed to refer to the Indebtedness evidenced by
the Asset Bridge Notes; and
(vii) provisions within the Incorporated Agreement shall be
deemed for all purposes hereof to be modified as set forth in ARTICLES
III, VI and VII hereof.
"INITIAL RATE" has the meaning set forth in SECTION 2.5(B).
"INTEREST PAYMENT DATE" means each May 4, August 4, November 4 and
February 4 (or, if any such date is not a Business Day, the next succeeding
Business Day).
"INTERMEDIATE HOLDINGS" is defined in the preamble.
"ISSUANCE DATE" means the date the Asset Bridge Notes are issued by
Intermediate Holdings and purchased by the Purchasers.
"ISSUANCE DATE CERTIFICATE" means a certificate of an Authorized
Officer of Holdings and Intermediate Holdings substantially in the form of
EXHIBIT F hereto, delivered pursuant to CLAUSE (D) of SECTION 5.1.
"LENDERS" means the banks and other financial institutions from time to
time party to the Credit Agreement.
"LOAN DOCUMENTS" means the Credit Agreement, together with all notes,
collateral and security documents, guaranties, interest rate hedge or similar
arrangements to which the counterparty at the time such interest rate hedge or
similar arrangement was entered into was a lender under the Credit Agreement or
any of its Affiliates, agreements and other documents delivered at any time in
connection therewith, all as amended, supplemented or otherwise modified from
time to time in accordance with their respective terms.
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"MAJORITY HOLDERS" means (i) at any time prior to the issuance of the
Asset Bridge Notes, the Purchasers and (ii) at any time thereafter, the holders
of voting rights with respect to waivers, amendments and other actions permitted
or required to be taken by Holders under the terms of the Asset Bridge Notes
constituting a majority of such voting rights attributable to the aggregate
outstanding amount of Asset Bridge Notes at such time.
"MATERIAL ACQUISITION DOCUMENTS" means the Merger Agreement, the Credit
Agreement and all other material instruments, agreements and documents relating
to the Acquisition, the RailAmerica Refinancing, the RailTex Refinancing, the
Intermediate Holdings Asset Bridge Note Issuance, the Equity Issuance, the Asset
Transfer and the transactions contemplated hereby or thereby, in each case as
amended from time to time in accordance with CLAUSE (J) of SECTION 6.2.
"MATERIAL ADVERSE EFFECT" means (i) a material adverse effect upon the
business, assets, condition (financial or otherwise), operations, performance,
properties or prospects of Holdings, Intermediate Holdings and the Designated
Restricted Subsidiaries taken as a whole, (ii) the material impairment of the
ability of Holdings, Intermediate Holdings or any Guarantor to perform their
respective obligations under the Financing Documents, or (iii) a material
adverse effect on the rights and remedies of any Holder under any Financing
Document.
"MORTGAGE" means each mortgage, deed of trust or agreement executed and
delivered by any Designated Restricted Subsidiary in favor of the Collateral
Agent for the benefit of the Secured Parties pursuant to the requirements of
this Agreement in form and substance satisfactory to the Collateral Agent, under
which a Lien is granted on the real property and fixtures described therein, as
amended, supplemented, amended and restated or otherwise modified from time to
time.
"NET DEBT PROCEEDS" means with respect to the sale or issuance by
Holdings, Intermediate Holdings or the Designated Restricted Subsidiaries to any
Person of any of its Indebtedness not permitted pursuant to Section 7.2.2 of the
Incorporated Agreement as incorporated by reference in CLAUSE (B) of SECTION
6.2, the EXCESS of:
(a) the gross cash proceeds received by such Person from such
sale or issuance,
OVER
(b) all underwriting commissions and legal, investment
banking, brokerage and accounting and other professional fees, sales
commissions and disbursements actually incurred in connection with such
sale or issuance which have not been paid to Affiliates of Holdings in
connection therewith.
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"NET EQUITY PROCEEDS" means with respect to any sale or issuance by
Holdings, Intermediate Holdings or the Designated Restricted Subsidiaries to any
Person of any of their respective Capital Stock or, warrants or options for such
Capital Stock or the exercise of any such warrants or options, the excess of:
(a) the gross cash proceeds received by Holdings, Intermediate
Holdings or any such Designated Restricted Subsidiary from such sale,
exercise or issuance; PROVIDED, HOWEVER, that Intermediate Holdings may
exclude up to $100,000 in aggregate of such gross proceeds received in
each Fiscal Year as a result of any sale or issuance by Holdings or
Intermediate Holdings to any Person of any of their respective Capital
Stock or, warrants or options for such Capital Stock or the exercise of
any such warrants or options,
OVER
(b) the sum of all underwriting commissions and legal,
investment banking, brokerage, accounting and other professional fees,
sales commissions and disbursements actually incurred in connection
with such sale or issuance which have not been paid to Affiliates of
Holdings or Intermediate Holdings in connection therewith.
"OBLIGATIONS" means all obligations (monetary or otherwise, whether
absolute or contingent, matured or unmatured) of Holdings, Intermediate Holdings
and each other Obligor arising under or in connection with a Financing Document,
including the principal of and premium, if any, and interest (including interest
accruing during the pendency of any proceeding of the type described in Section
8.1.9 of the Incorporated Agreement as incorporated by reference in CLAUSE (I)
of SECTION 7.1, whether or not allowed in such proceeding) on the Asset Bridge
Notes.
"OTHER TAXES" has the meaning set forth in SECTION 2.7(A).
"PERSON" means an individual or a corporation, partnership, trust,
incorporated or unincorporated association, joint venture, joint stock company,
government (or any agency or political subdivision thereof) or other entity of
any kind.
"PRIME RATE" means, as of any date, the rate of interest then most
recently announced by The Bank of New York as its prime or reference rate for
dollars loaned in the United States.
"PROJECTIONS" is defined in CLAUSE (H)(I)(B) of SECTION 5.1.
"PURCHASERS" is defined in the PREAMBLE.
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"RESTRICTED SUBSIDIARY" means any Subsidiary of Intermediate Holdings
other than Ferronor.
"SECURED PARTIES" means the Collateral Agent and each of the Holders.
"SECURED PARTY'S ENVIRONMENTAL LIABILITY" means any and all losses,
liabilities, obligations, penalties, claims, litigation, demands, defenses,
costs, judgments, suits, proceedings, damages (including consequential damages),
disbursements or expenses of any kind or nature whatsoever (including reasonable
attorneys' fees at trial and appellate levels and experts' fees and
disbursements and expenses incurred in investigating, defending against or
prosecuting any litigation, claim or proceeding) which may at any time be
imposed upon, incurred by or asserted or awarded against any Secured Party or
any of such Person's Affiliates, shareholders, directors, officers, employees,
and agents in connection with or arising from:
(a) any Hazardous Material on, in, under or affecting all or
any portion of any property owned, leased or operated upon (including
rights of way easements) of Holdings, Intermediate Holdings or any of
its Designated Restricted Subsidiaries, the groundwater thereunder, or
any surrounding areas thereof to the extent caused by Releases from
Holdings', Intermediate Holdings' or any of its Designated Restricted
Subsidiaries' or any of their respective predecessors' properties
owned, leased or operated upon (including right of way easements);
(b) any misrepresentation, inaccuracy or breach of any
warranty contained in Section 6.12 of the Incorporated Agreement as
incorporated by reference in CLAUSE (K) of Section 3.1;
(c) any violation or claim of violation by Holdings,
Intermediate Holdings or any of its Designated Restricted Subsidiaries
of any Environmental Laws; or
(d) the imposition of any lien for damages caused by or the
recovery of any costs for the cleanup, release or threatened release of
Hazardous Material by Holdings, Intermediate Holdings or any of its
Designated Restricted Subsidiaries, or in connection with any property
owned, leased or operated upon (including right of way easements) or
formerly owned, leased or operated upon (including rights of way
easements) by Holdings, Intermediate Holdings or any of its Designated
Restricted Subsidiaries.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SECURITY DOCUMENTS" means, collectively, the Asset Bridge Pledge and
Security Agreement, the Foreign Pledge Agreements, if any, and the Mortgage(s).
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"SHELF REGISTRATION" means a "shelf" registration statement on any
appropriate form pursuant to Rule 415 (or similar rule that may be adopted by
the Commission) under the Securities Act.
"SUBORDINATED DEBT" means unsecured Indebtedness of Holdings,
Intermediate Holdings or any their Restricted Subsidiaries subordinated in right
of payment to the Obligations pursuant to documentation containing redemption
and other prepayment events, maturities, amortization schedules, covenants,
events of default, remedies, acceleration rights, subordination provisions and
other material terms satisfactory to the Majority Holders.
"TAXES" has the meaning set forth in SECTION 2.7(A).
"TRANSFER" means any disposition of Asset Bridge Notes that would
constitute a sale thereof under the Securities Act.
"TREASURY RATE" means, as of any date, the yield to maturity as of such
date of United States Treasury securities with a constant maturity (as compiled
and published in the most recent Federal Reserve Statistical Release H.15 (519)
that has become publicly available at least two Business Days prior to such date
(or, if such Statistical Release is no longer published, any publicly available
source of similar market data)) most nearly equal to (but not less than) the
remaining term to maturity of the Asset Bridge Notes; PROVIDED, HOWEVER, that if
such term to maturity is less than one year, the weekly average yield on
actually traded United States Treasury securities adjusted to a constant
maturity of one year shall be used.
"WARRANT SHARES" has the meaning set forth in CLAUSE (U) of SECTION
5.1.
"WARRANTS" means the warrants to purchase common stock of Holdings to
be issued pursuant to the Asset Bridge Warrant Agreement.
Section 1.2 INCORPORATED DEFINITION. Unless the context otherwise
requires, capitalized terms defined in the Incorporated Agreement and not
otherwise defined herein shall have the meanings assigned thereto in the
Incorporated Agreement.
ARTICLE II
PURCHASE AND SALE OF SECURITIES; TERMS OF SECURITIES
Section 2.1 COMMITMENT TO PURCHASE. (a) Subject to the terms and
conditions set forth herein and in reliance on the representations and
warranties of Intermediate Holdings contained herein and in the other Financing
Documents, Intermediate Holdings may at its option issue and sell to the
Purchasers on the Issuance Date, and each Purchaser agrees to purchase on the
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Issuance Date, Asset Bridge Notes in an aggregate outstanding principal amount
equaling such Purchaser's Commitment. The purchase price for the Asset Bridge
Notes shall be 100% of the principal amount thereof.
(b) The Commitment will terminate (the "EXPIRATION DATE") on the
earliest of (i) the termination of the Merger Agreement in accordance with the
terms thereof prior to the consummation of the Acquisition, (ii) the
consummation of the Transaction without the issuance of the Asset Bridge Notes
(if such date occurs prior to the Issuance Date) and (iii) 5:00 P.M. (New York
City time) on April 15, 2000 (if such date occurs prior to the Issuance Date);
PROVIDED, that if at any time on or after the date hereof an Event of Default
shall have occurred and be continuing, a Purchaser may at its option terminate
its Commitment by notice to Intermediate Holdings, such termination to be
effective upon the giving of such notice; and PROVIDED, FURTHER, that the
Commitments shall automatically terminate, without notice to Intermediate
Holdings or any other action on the part of the Purchasers, upon the occurrence
of any Default described in clauses (b), (c) or (d) of Section 8.1.9 of the
Incorporated Agreement as incorporated by reference in CLAUSE (I) of SECTION 7.1
with respect to any Obligor.
(c) The Commitments are not revolving in nature, and principal amounts
of Asset Bridge Notes prepaid in accordance with SECTION 2.6 may not be resold
to the Purchasers hereunder.
Section 2.2 TAKEDOWN PROCEDURES. (a) Intermediate Holdings shall give
the Purchasers notice not later than 3:00 P.M. (New York City time) one Business
Day before the date of the proposed purchase and sale of Asset Bridge Notes,
which notice shall specify the principal amount of Asset Bridge Notes to be
purchased and sold and the proposed Issuance Date (which shall be a Business
Day).
(b) On the Issuance Date, the Purchasers, severally and not jointly,
shall deliver by wire transfer, to the account number of Intermediate Holdings
specified by Intermediate Holdings in writing no later than 1:00 P.M. (New York
City time) on the Issuance Date, immediately available funds in an amount equal
to the aggregate purchase price of the Asset Bridge Notes to be purchased by the
Purchasers hereunder on such Issuance Date, less the aggregate amount of fees
payable by Intermediate Holdings to the Purchasers on such date pursuant to
SECTION 2.3 and expenses (if any) payable to the Purchasers on such date
pursuant to SECTIONS 9.8 and 11.4.
(c) On the Issuance Date, against payment as set forth in CLAUSE (B)
above, Intermediate Holdings shall deliver to each Purchaser a single Asset
Bridge Note representing the aggregate principal amount of Asset Bridge Notes to
be purchased by such Purchaser registered in the name of such Purchaser, or, if
requested by such Purchaser, separate Asset Bridge Notes in such other
denominations representing in total such aggregate principal amount and
registered in such name or names as shall be designated by such Purchaser by
notice to Intermediate Holdings at least one Business Day prior to the Issuance
Date.
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Section 2.3 FEES. Intermediate Holdings shall pay to the Purchasers the
fees that are set forth in the Fee Letter at such times and in such amounts as
agreed to therein.
Section 2.4 MANDATORY TERMINATION OF COMMITMENTS. The Commitment shall
terminate on the Expiration Date.
Section 2.5 INTEREST. (a) Interest on each Asset Bridge Note shall be
payable quarterly in arrears, on each Interest Payment Date of each year in
which such Asset Bridge Note remains outstanding, commencing with the first
Interest Payment Date after the date of issuance thereof, on the principal
amount of such Asset Bridge Note outstanding. Interest on each Asset Bridge Note
shall be calculated at the rates per annum set forth below and shall accrue from
and including the most recent Interest Payment Date to which interest has been
paid on such Asset Bridge Note (or if no interest has been paid on such Asset
Bridge Note, from the date of issuance thereof in the case of each Asset Bridge
Note) to but excluding the date on which payment in full of the principal sum of
such Asset Bridge Note has been made.
(b) The interest rate applicable to each Asset Bridge Note (i) from and
including the Issuance Date to but excluding the day that is 180 days following
the Issuance Date shall be 15.00%, (ii) from and including the day that is 180
days following the Issuance Date to but excluding the day that is 270 days
following the Issuance Date shall be 15.50% and (iii) from and including the day
that is 270 days following the Issuance Date to but excluding the date that each
such Asset Bridge Note shall have been paid in full in cash shall be 15.75%.
Interest on each Asset Bridge Note will be calculated on the basis of a 360-day
year and paid for the actual number of days elapsed.
(c) Overdue principal and interest on the Asset Bridge Notes shall bear
interest from the date so due to the date paid at a rate which is 2.0% per annum
in excess of the rate then borne by the Asset Bridge Notes.
(d) Notwithstanding anything to the contrary set forth above,
Intermediate Holdings may, at its option, in lieu of making payments of interest
in cash on any Interest Payment Date (other than the Interest Payment Date
occuring on or about the date that the Asset Bridge Notes shall be paid in
full), pay interest on such Interest Payment Date through the issuance of
Additional Asset Bridge Notes. Such Additional Asset Bridge Notes issued on any
Interest Payment Date shall, subject to the remaining provisions of this
paragraph, be in an aggregate principal amount equal to the interest then due
for such Interest Payment Date, shall otherwise be identical to the outstanding
Asset Bridge Notes and shall be issued to the Holders of the outstanding Asset
Bridge Notes in proportions such that each Holder shall receive the same ratio
of cash interest, if any, to Additional Asset Bridge Notes on such Interest
Payment Date.
Section 2.6 MATURITY OF ASSET BRIDGE NOTES; PREPAYMENT OF ASSET BRIDGE
NOTES. (a) The Asset Bridge Notes shall mature on the earlier of (x) the First
Anniversary Date (PROVIDED,
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HOWEVER that, unless Intermediate Holdings shall have notified the Purchasers in
writing not less than 5 Business Days prior to the First Anniversary Date of its
intention to repay the Asset Bridge Notes in full on or prior to the First
Anniversary Date, the maturity date for purposes of this CLAUSE (X) will be
automatically extended to the date which is six (6) months after the Stated
Maturity Date for Term B Loans if, on the First Anniversary Date, (i) no Default
under this Agreement shall have occurred and be continuing; (ii) no event of
default or event which with the giving of notice or the lapse of time, or both,
would become an event of default under the Loan Documents or any Indebtedness of
Holdings, Intermediate Holdings or any of its Designated Restricted Subsidiaries
relating to more than $5,500,000 in aggregate principal amount shall have
occurred and be continuing; and (iii) all fees and expenses payable as of such
date to the Purchasers or Holders hereunder shall have been paid in full) and
(y) the date that all or substantially all of the Collateral (as defined in the
Security Documents) shall have been Disposed of by Intermediate Holdings and/or
the relevant Guarantors.
(b) For so long as any Asset Bridge Notes are outstanding, Intermediate
Holdings at its option may, upon 5 Business Days' written notice to the Holders
thereof, at any time, prepay all or any part of the principal amount of the
Asset Bridge Notes at a redemption price equal to 100.00% of the outstanding
principal amount of the Asset Bridge Notes so prepaid, together with accrued and
unpaid interest through the date of prepayment.
(c) (i) Intermediate Holdings shall, following the receipt by any
Designated Restricted Subsidiary of any Casualty Proceeds deliver to the Holders
a calculation of the amount of such Casualty Proceeds and make a mandatory
redemption of the Asset Bridge Notes at a redemption price of 100.00% of the
principal amount so redeemed in an amount equal to 100% of such Casualty
Proceeds within 15 Business Days of the receipt thereof; PROVIDED, HOWEVER, that
if
(A) Intermediate Holdings informs the Holders in writing no
later than the earlier of (x) 30 days following the occurrence of the
Casualty Event resulting in such Casualty Proceeds and (y) 5 Business
Days following the receipt of such Casualty Proceeds of such Designated
Restricted Subsidiary's good faith intention to apply such Casualty
Proceeds to the rebuilding or replacement of the damaged, destroyed or
condemned assets or property or the acquisition or construction of
other long-term capital assets useful in the such Designated Restricted
Subsidiary's business and
(B) the Majority Holders give their written consent to such
application,
then no mandatory redemption on account of Casualty Proceeds shall be required
under this clause so long as such Designated Restricted Subsidiary in fact uses
such Casualty Proceeds to rebuild or replace such damaged, destroyed or
condemned assets or acquire or construct such other long-term assets in
accordance with, among other things, the schedule consented to by the Majority
Holders, with any amount of such Casualty Proceeds not so requested to be so
applied
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in such rebuilding, replacement, acquisition or construction being applied to
redeem the Asset Bridge Notes at a redemption price of 100.00% of the principal
amount so redeemed.
(ii) Intermediate Holdings shall, following the receipt by Intermediate
Holdings or any Designated Restricted Subsidiary of any Net Disposition Proceeds
in excess of $15,000 (individually or in the aggregate), deliver to the Holders
a calculation of the amount of such Net Disposition Proceeds and make a
mandatory redemption of the Asset Bridge Notes at a redemption price of 100.00%
of the principal amount so redeemed in an amount equal to 100% of such Net
Disposition Proceeds within one Business Day of the receipt thereof; PROVIDED,
HOWEVER, that a Disposition by Intermediate Holdings of any of its assets other
than the Capital Stock of any Designated Restricted Subsidiary shall not
constitute a Disposition for purposes of determining Net Disposition Proceeds
hereunder.
(iii) Concurrently with the receipt by Holdings, Intermediate Holdings
or any of the Restricted Subsidiaries of any Net Equity Proceeds, Holdings shall
deliver to the Holders a calculation of the amount of such Net Equity Proceeds
and Intermediate Holdings shall make a mandatory redemption of the Asset Bridge
Notes at a redemption price of 100% of the principal amount so redeemed in an
amount equal to 100% of such Net Equity Proceeds.
(iv) Concurrently with the receipt by Holdings, Intermediate Holdings
or any of the Restricted Subsidiaries of any Net Debt Proceeds, Holdings shall
deliver to the Holders a calculation of the amount of such Net Debt Proceeds and
Intermediate Holdings shall make a mandatory redemption of the Asset Bridge
Notes at a redemption price of 100% of the principal amount so redeemed in an
amount equal to the lesser of (x) 100% of such Net Debt Proceeds and (y)
$10,000,000.
(v) Concurrently with the Disposition by Holdings, Intermediate
Holdings or any of their respective Restricted Subsidiaries of any Capital Stock
of QRC owned by Holdings, Intermediate Holdings or any such Restricted
Subsidiary to any Person other than Intermediate Holdings or any of its
Designated Restricted Subsidiaries, Intermediate Holdings shall make a mandatory
redemption of the Asset Bridge Notes at a redemption price of 100% of the
principal amount so redeemed in an amount equal to the amount of consideration
received by Holdings, Intermediate Holdings or any such Restricted Subsidiary,
as the case may be.
(vi) Notwithstanding anything contained in this Agreement to the
contrary, Intermediate Holdings shall not be obligated to prepay or redeem the
principal amount of Asset Bridge Notes (A) with (1) any Net Debt Proceeds of any
Debt Incurrence if such prepayment is prohibited by the lenders with respect to
such Debt Incurrence or (2) any Net Debt Proceeds or Net Equity Proceeds, to the
extent any portion of such Net Debt Proceeds or Net Equity Proceeds are required
under the Credit Agreement to be paid to the holders of the principal amount of
any loans thereunder or (B) with respect to any Excess Cash Flow, to the extent
a mandatory
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prepayment is required under the Credit Agreement to be paid to the holders of
the principal amount of any loans thereunder in respect of any portion of such
Excess Cash Flow.
(d) Any prepayment of the Asset Bridge Notes pursuant to SECTION 2.6(B)
shall be in a minimum amount of at least $500,000, unless less than $500,000 of
the Asset Bridge Notes remain outstanding, in which case all of the Asset Bridge
Notes must be prepaid. Any prepayment of the Asset Bridge Notes pursuant to
SECTION 2.6(C) shall be in a minimum amount which is a multiple of $1,000 times
the number of Holders at the time of such prepayment.
(e) Any partial prepayment of the Asset Bridge Notes pursuant to
SECTION 2.6(B) shall be made so that the Asset Bridge Notes held by each Holder
shall be prepaid in a principal amount which shall bear the same ratio, as
nearly as may be, to the total principal amount of such Asset Bridge Notes being
prepaid as the principal amount of such Asset Bridge Notes held by such Holder
shall bear to the aggregate principal amount of all such Asset Bridge Notes then
outstanding. Any partial prepayment of the Asset Bridge Notes pursuant to
SECTION 2.6(C) shall be applied the Asset Bridge Notes until all such Asset
Bridge Notes shall have been prepaid in full, and shall be made so that such
Asset Bridge Notes then held by each Holder shall be prepaid in a principal
amount which shall bear the same ratio, as nearly as may be, to the total
principal amount of such Asset Bridge Notes being prepaid as the principal
amount of such Asset Bridge Notes held by such Holder shall bear to the
aggregate principal amount of all such Asset Bridge Notes then outstanding. In
the event of a partial prepayment of any Asset Bridge Note, upon presentation
and surrender of such Asset Bridge Note Intermediate Holdings shall execute and
deliver to or on the order of the Holder, at the expense of Intermediate
Holdings, a new Asset Bridge Note in principal amount equal to the remaining
outstanding portion of such Asset Bridge Note.
Section 2.7 TAXES. (a) For the purposes of this Section, the following
terms have the following meanings:
"Taxes" means any and all present or future taxes, duties, levies,
imposts, deductions, charges or withholdings with respect to any payment by
Intermediate Holdings pursuant to this Agreement or under any Asset Bridge Note
or any other Financing Document, and all liabilities with respect thereto,
excluding (i) United States federal withholding taxes payable under laws in
effect on the date hereof and (ii) in the case of the Collateral Agent, any
Purchaser or any other Holder, taxes imposed on the net income of the Collateral
Agent or such Purchaser or Holder and franchise or similar taxes imposed on the
net income of the Collateral Agent or such Purchaser or Holder, by a
jurisdiction under the laws of which the Collateral Agent or such Purchaser or
Holder is organized or in which its principal executive office or the office
holding any Asset Bridge Notes or any Financing Document is located.
"Other Taxes" means any present or future stamp or documentary taxes
and any other excise or property taxes, or similar charges or levies, which
arise from any payment made
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pursuant to this Agreement or under any Asset Bridge Note or any other Financing
Document or from the execution, delivery, registration, recordation or
enforcement of, or otherwise with respect to, this Agreement or any Asset Bridge
Note or any other Financing Document.
(b) All payments by Intermediate Holdings to or for the account of the
Collateral Agent or any Purchaser or Holder under any Financing Document shall
be made without deduction for any Taxes or Other Taxes; PROVIDED that, if
Intermediate Holdings shall be required by law to deduct any Taxes or Other
Taxes from any such payment, the sum payable shall be increased as necessary so
that after making all required deductions (including deductions applicable to
additional sums payable under this Section), the Collateral Agent or such
Purchaser or Holder (as the case may be) receives an amount equal to the sum it
would have received had no such deductions been made, Intermediate Holdings
shall make such deductions, Intermediate Holdings shall pay the full amount
deducted to the relevant taxation authority or other authority in accordance
with applicable law and Intermediate Holdings shall promptly furnish to the
Collateral Agent or such Purchaser or Holder (as the case may be) the original
or a certified copy of a receipt or other documentation available to
Intermediate Holdings evidencing payment thereof.
(c) Intermediate Holdings agrees to indemnify the Collateral Agent and
each Purchaser and Holder for the full amount of Taxes and Other Taxes
(including, without limitation, any Taxes or Other Taxes imposed or asserted
(whether or not correctly) by any jurisdiction on amounts payable under this
Section) paid by the Collateral Agent or such Purchaser or Holder (as the case
may be) and any liability (including penalties, interest and expenses) arising
therefrom or with respect thereto; PROVIDED, HOWEVER, that Intermediate Holdings
shall not be obligated to make any payment pursuant to this SECTION 2.7(C) in
respect of penalties or interest attributable to any Taxes or Other Taxes, if
written demand therefor has not been made by the Collateral Agent or such
Purchaser or Holder (as the case may be) within 60 days from the date on which
the Collateral Agent or such Purchaser or Holder received written notice of the
imposition of Taxes or Other Taxes by the relevant taxing authority, or for any
additional imposition which may arise from the failure of the Collateral Agent
or such Purchaser or Holder (as the case may be) to apply payments in accordance
with the applicable tax law after Intermediate Holdings has made the payments
required hereunder. After the Collateral Agent or any Purchaser or Holder (as
the case may be) receives written notice of the imposition of Taxes, the
Collateral Agent or such Purchaser or Holder will act in good faith to notify
Intermediate Holdings of its obligations thereunder as soon as reasonably
possible.
(d) Intermediate Holdings shall have no obligation for Taxes under
SECTION 2.7(B) or SECTION 2.7(C) for or on account of:
(i) any Taxes (other than Other Taxes) that would not have
been so imposed but for the existence of any present or former
connection between the Collateral Agent or any Purchaser, Holder or
beneficial owner of a Asset Bridge Note (or between a fiduciary,
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settlor, beneficiary, member, or shareholder of, or possessor of a
power over, the Collateral Agent or such Purchaser, Holder or
beneficial owner, if the Collateral Agent or such Purchaser, Holder or
beneficial owner is an estate, a trust, a partnership or corporation)
and the jurisdiction imposing the Tax other than merely holding such
Asset Bridge Note or any Financing Document, or the receipt of payments
in respect thereof, including, without limitation, the Collateral Agent
or such Purchaser, Holder or beneficial owner (or such fiduciary,
settlor, beneficiary, member, shareholder, or possessor) being or
having been a citizen or resident thereof, or being or having been
engaged in a trade or business or having a permanent establishment or
other fixed base therein, or making or having made an election the
effect of which is to subject the Collateral Agent or such Purchaser,
Holder or beneficial owner (or such fiduciary, settlor, beneficiary,
member, shareholder, or possessor) to such Tax;
(ii) any Taxes in the nature of estate, inheritance or gift
taxes;
(iii) any Tax that is imposed or withheld by reason of the
failure of the Collateral Agent or such Purchaser, Holder or beneficial
owner of a Asset Bridge Note to comply with a written request by
Intermediate Holdings, addressed to the Collateral Agent or such
Purchaser, Holder or beneficial owner, to provide information
concerning the nationality, residence or identity of the Collateral
Agent or such Purchaser, Holder or beneficial owner, if providing such
information under a statute, treaty, regulation or administrative
practice of the jurisdiction imposing such Tax would result in a
complete exemption from such Tax;
(iv) any Taxes imposed on any payment on a Asset Bridge Note
to any Purchaser or Holder that is a fiduciary or partnership or other
than sole beneficial owner of such payment to the extent a beneficiary
or settlor with respect to such fiduciary or a member of such
partnership or a beneficial owner would not have been entitled to the
payment of taxes had such beneficiary, settlor, member or beneficial
owner directly received its beneficial or distributive share of such
payment; and
(v) any combination of items (i) through (iv) above.
(e) If Intermediate Holdings determines in good faith that a reasonable
basis exists for contesting the imposition of a Tax or Other Tax with respect to
the Collateral Agent or any Purchaser or Holder, the Collateral Agent, such
Purchaser or Holder (as the case may be) shall cooperate with Intermediate
Holdings in challenging such Tax or Other Tax at Intermediate Holdings' expense
(including, without limitation, any additional costs, expenses or Taxes incurred
by the Collateral Agent or any Purchaser or Holder, as the case may be, as a
result of such contesting of such Taxes) if requested by Intermediate Holdings;
PROVIDED, HOWEVER, that nothing in this SECTION 2.7(E) shall require the
Collateral Agent or any Purchaser or Holder to submit to Intermediate Holdings
any tax returns or any part thereof, or to prepare or file any tax
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returns other than as the Collateral Agent or such Purchaser or Holder in its
sole discretion shall determine.
(f) Each of the Collateral Agent and each Purchaser and Holder agrees,
to the extent reasonable and without material cost to it, to cooperate with
Intermediate Holdings to minimize any amounts payable by Intermediate Holdings
under this SECTION 2.7.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF
HOLDINGS, INTERMEDIATE HOLDINGS AND THE COMPANY
Each of Holdings and Intermediate Holdings represents and warrants to
the Purchasers (both before and after giving effect to the Transaction) as set
forth below:
Section 3.1 INCORPORATION OF REPRESENTATIONS AND WARRANTIES IN
INCORPORATED AGREEMENT. Each of Holdings and Intermediate Holdings hereby makes,
for the benefit of the Purchasers and the Holders from time to time of the Asset
Bridge Notes, the representations and warranties contained in the following
Sections of the Incorporated Agreement:
(a) 6.1 (Organization, etc.);
(b) 6.2 (Due Authorization, Non-Contravention, etc.);
(c) 6.3 (Government Approval, Regulation, etc.);
(d) 6.5 (Financial Information);
(e) 6.6 (No Material Adverse Change);
(f) 6.7 (Litigation, Labor Controversies, etc.);
(g) 6.8 (Subsidiaries);
(h) 6.9 (Ownership of Properties);
(i) 6.10 (Taxes);
(j) 6.11 (Pension and Welfare Plans);
(k) 6.12 (Environmental Warranties);
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(l) 6.13 (Accuracy of Information);
(m) 6.14 (Regulations U and X);
(n) 6.15 (Year 2000); and
(o) 6.17 (Solvency).
Section 3.2 AUTHORIZATION, EXECUTION AND ENFORCEABILITY. (a) Each of
the Financing Documents (other than the Asset Bridge Notes) and the Material
Acquisition Documents to which any of Holdings or Intermediate Holdings is a
party constitutes the valid and binding agreement of such Obligor enforceable in
accordance with its terms (except, in any case, as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors' rights generally and by principles of equity). When
executed and delivered by Intermediate Holdings against payment therefor in
accordance with the terms hereof, the Asset Bridge Notes will constitute valid
and binding obligations of Intermediate Holdings, enforceable in accordance with
their terms (except, in any case, as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization or similar laws affecting
creditors' rights generally and by principles of equity).
(b) The Warrants have been duly authorized by Holdings. When executed
pursuant to the terms of the Asset Bridge Warrant Agreement and delivered to the
Escrow Agent pursuant to the provisions of this Agreement, the Warrants will be
the valid and binding obligations of Holdings, enforceable against it in
accordance with their terms (except, in any case, as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors' rights generally and by principles of equity).
(c) The Warrant Shares to be issued upon exercise of the Warrants have
been duly authorized and reserved for issuance by Holdings and will be issued at
the times and in the manner required by the Asset Bridge Warrant Agreement and,
upon due exercise of a Warrant, the Warrant Shares issued will be validly
issued, fully paid and nonassessable.
Section 3.3 CAPITALIZATION. At the Issuance Date, after giving effect
to the consummation of the Transaction, the capitalization of Holdings will be
as set forth on SCHEDULE 3.3. All of the issued and outstanding shares of Common
Stock of Holdings are, and, upon consummation of the Transaction, will be,
validly issued, fully paid and nonassessable and the holders thereof are not
entitled to any preemptive or other similar rights. Except for the Material
Acquisition Documents or as set forth on SCHEDULE 3.3, there are no
subscriptions, options, warrants, rights, convertible securities, exchangeable
securities or other agreements or commitments of any character pursuant to which
Holdings is required to issue any shares of its capital stock.
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Section 3.4 SOLICITATION. No form of general solicitation or general
advertising was used by Intermediate Holdings or, to the best of its knowledge,
any other Person acting on behalf of Intermediate Holdings, in connection with
the offer and sale of the Asset Bridge Notes. Neither Intermediate Holdings nor,
to the best of its knowledge, any Person acting on behalf of Intermediate
Holdings has, either directly or indirectly, sold or offered for sale to any
Person any of the Asset Bridge Notes or any other similar security of
Intermediate Holdings except as contemplated by this Agreement, and Intermediate
Holdings represents that neither Intermediate Holdings nor any person acting on
its behalf other than the Purchasers and its Affiliates will sell or offer for
sale to any Person any such security to, or solicit any offers to buy any such
security from, or otherwise approach or negotiate in respect thereof with, any
Person or Persons so as thereby to bring the issuance or sale of any of the
Asset Bridge Notes within the provisions of Section 5 of the Securities Act.
Section 3.5 NON-FUNGIBILITY. When the Asset Bridge Notes are issued and
delivered pursuant to this Agreement, the Asset Bridge Notes will not be of the
same class (within the meaning of Rule 144A under the Securities Act) as
securities which are (i) listed on a national securities exchange registered
under Section 6 of the Exchange Act or (ii) quoted in a U.S.
automated inter-dealer quotation system.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PURCHASERS
Section 4.1 PURCHASE FOR INVESTMENT; AUTHORITY; BINDING AGREEMENT. Each
of the Purchasers represents and warrants, severally and not jointly, as to
itself only, to Holdings and Intermediate Holdings that:
(a) such Purchaser is an Accredited Investor within the
meaning of Rule 501(a) under the Securities Act and the Asset Bridge
Notes to be acquired by it pursuant to this Agreement are being
acquired for its own account without a view toward distribution and the
Purchaser will not offer, sell, transfer, pledge, hypothecate or
otherwise dispose of the Asset Bridge Notes unless pursuant to a
transaction either registered under, or exempt from registration under,
the Securities Act;
(b) the execution, delivery and performance of this Agreement
and the purchase of the Asset Bridge Notes pursuant hereto are within
such Purchaser's corporate powers and have been duly and validly
authorized by all requisite corporate action;
(c) this Agreement has been duly executed and delivered by
such Purchaser;
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(d) this Agreement constitutes a valid and binding agreement
of such Purchaser enforceable in accordance with its terms;
(e) such Purchaser has such knowledge and experience in
financial and business matters so as to be capable of evaluating the
merits and risks of its investment in the Asset Bridge Notes and such
Purchaser is capable of bearing the economic risks of such investment;
and
(f) such Purchaser has had the opportunity to ask questions of
and receive answers from representatives of Holdings concerning
Holdings and its Subsidiaries and the terms and conditions of this
Agreement and the Asset Bridge Notes, and has been granted access to
all books, records and documents of Holdings and its Subsidiaries as it
has requested.
ARTICLE V
CONDITIONS PRECEDENT TO PURCHASE
Section 5.1 CONDITIONS TO PURCHASERS' OBLIGATION AT TAKEDOWN. The
obligation of the Purchasers (which is several and not joint) to purchase the
Asset Bridge Notes to be issued and sold by Intermediate Holdings on the
Issuance Date is subject to the satisfaction of the following conditions
contemporaneously with such purchase:
(a) RESOLUTIONS, ETC. The Purchasers shall have received from
each Obligor, as applicable, (i) a copy of a good standing certificate,
dated a date reasonably close to the Issuance Date, for each such
Person and (ii) a certificate, dated the Issuance Date, duly executed
and delivered by such Person's Secretary or Assistant Secretary,
managing member or general partner, as applicable, as to
(i) resolutions of each such Person's Board of
Directors (or other managing body, in the case of other than a
corporation) then in full force and effect authorizing, to the
extent relevant, all aspects of the Transaction applicable to
such Person and the execution, delivery and performance of
each Financing Document to be executed by such Person and the
transactions contemplated hereby and thereby;
(ii) the incumbency and signatures of those of its
officers, managing member or general partner, as applicable,
authorized to act with respect to each Financing Document to
be executed by such Person; and
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(iii) the full force and validity of each Organic
Document of such Person and copies thereof;
upon which certificates each Secured Party may conclusively rely until
it shall have received a further certificate of the Secretary,
Assistant Secretary, managing member or general partner, as applicable,
of any such Person canceling or amending the prior certificate of such
Person.
(b) TRANSACTION CONSUMMATED. (i) The Asset Transfer shall have
been consummated on terms and conditions reasonably
satisfactory to the Purchasers.
(ii) The Acquisition shall have been consummated (or
shall be consummated contemporaneously with the application by
the Company of the proceeds of the Asset Bridge Notes that
have been contributed to it by Intermediate Holdings) and in
connection therewith, the Company shall have acquired 100% of
the issued and outstanding stock of RailTex pursuant to the
Merger Agreement for a merger consideration comprised of (i)
an aggregate cash purchase price of no more than $139,000,000
and (ii) the Equity Issuance (as defined in the Incorporated
Agreement) which shall have been consummated on terms
(including documentation in respect thereof in form and
substance) satisfactory in all respects to the Purchasers.
(iii) In connection with the Acquisition, the Rail
America Refinancing and the RailTex Refinancing shall have
been consummated (or shall be consummated contemporaneously
with the application by the Company of the proceeds of the
Asset Bridge Notes that have been contributed to it by
Intermediate Holdings) on terms and conditions satisfactory in
all respects to the Purchasers and except for capital leases
and senior secured indebtedness totaling $17,900,000 and
convertible subordinated indebtedness of $24,600,000, Holdings
and its Subsidiaries shall have no indebtedness for borrowed
money other than that incurred in connection with the
Transaction.
(iv) The Company shall have received proceeds of not
less than $330,000,000 of Term Loans under the Credit
Agreement and the Revolving Loans shall be available
thereunder (but undrawn) on the Issuance Date.
(v) The Subordinated Bridge Note Issuance shall have
been consummated on terms (including documentation in respect
thereof in form and substance) satisfactory in all respects to
the Purchasers and resulted in gross cash proceeds of at least
$95,000,000.
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(vi) RailTex shall have received net cash proceeds
from the exercise of RailTex stock options of at least
$11,100,000 (subject to adjustment due to cashless exercise of
such options and termination of such options not exercised).
(vii) The Company shall have at least $10,300,000
cash on hand immediately prior to the consummation of the
Transaction.
(viii) RailTex shall have received net cash proceeds
from the sale of RailTex Brazil of at least $9,000,000.
(ix) The fees and expenses paid or to be paid in
connection with the Transaction shall not exceed $36,000,000.
(c) TRANSACTION DOCUMENTS. The Purchasers shall have received
copies of fully executed versions of the Transaction Documents
(including the Material Acquisition Documents and the Loan Documents),
certified to be true and complete copies thereof by an Authorized
Officer of Holdings and Intermediate Holdings. Each Transaction
Document (including the Merger Agreement) shall be in full force and
effect and shall not have been modified or waived in any material
respect, nor shall there have been any forbearance to exercise any
material rights with respect to any of the terms or provisions relating
to the conditions to the consummation of the Acquisition set forth in
the Merger Agreement unless otherwise agreed to by the Purchasers. The
covenants and the other terms and conditions contained in the Credit
Agreement shall be reasonably satisfactory to the Purchasers in all
respects.
(d) ISSUANCE DATE CERTIFICATE. The Purchasers shall have
received the Issuance Date Certificate, dated the Issuance Date and
duly executed and delivered by an Authorized Officer, of each of
Holdings and Intermediate Holdings, in which certificate each of
Holdings and Intermediate Holdings shall agree and acknowledge that the
statements made therein shall be deemed to be true and correct
representations and warranties of each of Holdings and Intermediate
Holdings as of such date, and, at the time each such certificate is
delivered, such statements shall in fact be true and correct. All
documents and agreements required to be appended to the Issuance Date
Certificate shall be in form and substance reasonably satisfactory to
the Purchasers.
(e) DELIVERY OF ASSET BRIDGE NOTES. The Purchasers shall have
received the Asset Bridge Notes to be issued on the Issuance Date, duly
executed by Intermediate Holdings in the denominations and registered
in the names specified in or pursuant to SECTION 2.2.
(f) PAYMENT OF OUTSTANDING INDEBTEDNESS, ETC. All Indebtedness
identified in ITEM 7.2.2(B) of the Disclosure Schedule (Indebtedness to
Be Paid) to the Incorporated Agreement, together with all interest, all
prepayment premiums and other amounts due
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and payable with respect thereto, shall have been paid in full in part
from the proceeds received by Intermediate Holdings in consideration
for the Asset Bridge Notes and the proceeds of the Credit Extensions
(as defined in the Credit Agreement) and the Subordinated Bridge Note
Issuance received by the Company and the commitments in respect of such
Indebtedness shall have been terminated, and all Liens securing payment
of any such Indebtedness have been released.
(g) FEES, EXPENSES, ETC. The Purchasers shall have received
for their respective accounts all fees, costs and expenses (other than
amounts to be netted against the purchase price of the Asset Bridge
Notes pursuant to SECTION 2.2(B)) due and payable pursuant to SECTIONS
2.3, 9.8 and 11.4.
(h) FINANCIAL INFORMATION, MATERIAL ADVERSE CHANGE. (i) The
Purchasers shall have received
(A) a consolidating PRO FORMA income
statement of Holdings and its Subsidiaries for each
of the twelve month periods ended December 31, 1998,
September 30, 1999 and December 31, 1999 and a
consolidated balance sheet of Holdings and its
Subsidiaries, as of the most recent date practicable
near to the Issuance Date (but no earlier than the
close of the Fiscal Quarter ending immediately prior
to the Issuance Date) certified by the treasurer,
chief financial or accounting Authorized Officer of
Holdings, in each case, giving effect to the
consummation of the Transaction and all the
transactions contemplated by this agreement and
reflecting estimated transaction related accounting
adjustments, prepared by the Company in accordance
with Regulation S-X; and
(B) projected financial statements
(including balance sheets and statements of income,
stockholders' equity and cash flows) of Holdings and
its Subsidiaries for the eight-year period following
the Issuance Date (the "PROJECTIONS") satisfactory in
form and substance to the Purchasers.
(ii) Since December 31, 1998, there shall not have
been any material adverse change in the business, assets,
condition (financial or otherwise), operations, performance,
properties, Projections or prospects of Holdings, Intermediate
Holdings and the Designated Restricted Subsidiaries, taken as
a whole.
(i) OPINIONS OF COUNSEL. The Purchasers shall have received
opinions, dated the Issuance Date and addressed to the Purchasers, from
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(i) Greenberg Traurig, P.A., counsel to the Obligors,
in form and substance satisfactory to the Purchasers;
(ii) Shutts & Bowen, counsel to the Obligors, in form
and substance satisfactory to the Purchasers; and
(iii) local counsel to the Guarantors in the
jurisdictions agreed upon by the Purchasers and Intermediate
Holdings, each in form and substance, and from counsel,
satisfactory to the Purchasers.
(j) SOLVENCY CERTIFICATE. The Purchasers shall have received a
certificate duly executed and delivered by the treasurer, chief
financial or accounting Authorized Officer of each of Holdings and
Intermediate Holdings, dated the date of the Issuance Date, in the form
of EXHIBIT G attached hereto.
(k) INSURANCE. The Purchasers shall have received certified
copies of the insurance policies (or binders in respect thereof), from
one or more insurance companies reasonably satisfactory to the
Purchasers, evidencing coverage required to be maintained pursuant to
each Loan Document.
(l) LITIGATION. There shall exist no pending or threatened
action, suit, investigation, litigation or proceeding in any court or
before any arbitrator or governmental instrumentality which (x)
purports to affect the consummation of the Transaction or the legality
or validity of this Agreement, any Asset Bridge Note, any other
Financing Document or any Material Acquisition Document or (y) could
reasonably be expected to have a Material Adverse Effect.
(m) MINIMUM EBITDA. The Company's EBITDA for the consecutive
twelve month period ended September 30, 1999 shall be at least
$93,900,000, including (i) EBITDA as reported of $62,800,000, (ii)
transaction related accounting adjustments, prepared by the Company
which are in accordance with Regulation S-X for Form S-1 Registration
Statements of no less than $26,700,000 and (iii) other pro forma cost
savings of no less than $4,400,000 which are reasonably satisfactory in
form and substance to the Purchasers.
(n) CORPORATE, TAX AND CAPITAL STRUCTURE. The tax structure
(including Organic Documents), the Tax-Sharing Agreement, the
shareholders agreements and the management of Holdings, Intermediate
Holdings and their respective Subsidiaries both before and after the
Transaction shall be reasonably satisfactory to the Purchasers in all
respects. The corporate and capital structure of Holdings, Intermediate
Holdings and such Subsidiaries shall be as set forth in ANNEX I hereto.
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(o) APPROVALS. All governmental, shareholder and third party
consents (including Surface Transportation Board clearance) and
approvals necessary or desirable in connection with the consummation of
the Transaction, and the related financings and other transactions
contemplated hereby shall have been duly obtained and all applicable
waiting periods shall have expired, without any action being taken by
any competent authority that could restrain, prevent or impose any
materially adverse conditions on the Transaction, and no such law or
regulation shall be applicable which in the judgment of the Purchasers
could have any such effect.
(p) ENVIRONMENTAL ASSESSMENT. The Purchasers shall have
received copies of an environmental assessment of the properties of the
Company and its Subsidiaries, to be completed by Pilko & Associates,
Inc. The results of such environmental assessment shall be reasonably
satisfactory in form, scope and substance to the Purchasers.
(q) APPRAISAL OF ASSETS. The Purchasers shall have received
copies of appraisals of the assets of the Company and its Subsidiaries
performed by Mainline Management Services, Inc. and Norman W. Seip &
Associates. The results of such appraisals shall be satisfactory in
form, scope and substance to the Purchasers.
(r) FOREIGN ACQUISITIONS AND TAKEOVERS ACT APPROVAL. If
Holdings, Intermediate Holdings or the Company is required to obtain an
approval or an indication of non-objection under the Foreign
Acquisitions and Takeovers Act 1975 of Australia or any real estate
policy guidelines of the Commonwealth Government of Australia and/or an
approval or certification of the Treasurer of Australia under the
Foreign Acquisitions and Takeovers Regulations of Australia to enter
into the Merger Agreement, or to give effect to the Transaction,
Intermediate Holdings shall have provided to the Purchasers, and the
Purchasers shall have received, copies of the application to obtain the
approval or certification of the Treasurer of Australia or the
statement of non-objection and copies of the relevant approval,
certification or statement.
(s) REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Intermediate Holdings contained in the Financing
Documents shall be true and correct in all material respects on and as
of the Issuance Date as if made on and as of such date (unless stated
to relate solely to an earlier date, in which case, such
representations and warranties shall be true and correct in all
material respects as of such earlier date) and Intermediate Holdings
shall have performed and complied with all covenants and agreements
required by the Financing Documents to be performed by it or complied
with by it at or prior to the Issuance Date, and the Purchasers shall
have received a certificate from an authorized officer of Intermediate
Holdings to such effect.
(t) NO DEFAULT. There shall not exist any Default.
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(u) WARRANTS. Pursuant to the terms of the Escrow Agreement,
Holdings shall have executed and delivered to the Escrow Agent fully
authenticated Warrants, unregistered or registered in blank,
representing the right to purchase shares of Common Stock of Holdings
at any time in an amount equal to 2.0% of the fully-diluted Capital
Stock of Holdings, calculated after giving effect to the transactions
occurring on or prior to the Issuance Date (the "WARRANT SHARES"),
exercisable for a period of seven years at a price equal to the closing
price per share of Common Stock of Holdings traded on the NASDAQ
National Market at the close of trading on the Issuance Date.
(v) FILING AGENT, ETC. All Uniform Commercial Code financing
statements and other similar financing statements in other
jursidictions and Uniform Commercial Code (Form UCC-3) termination
statements and other similar termination statements in other
jurisdictions required pursuant to the Financing Documents
(collectively, the "FILING STATEMENTS") shall have been delivered to CT
Corporation System or another similar filing service company acceptable
to the Collateral Agent (the "FILING AGENT") and other arrangements
acceptable to the Collateral Agent for filing in other jurisdictions
shall have been made. The Filing Agent shall have acknowledged in a
writing satisfactory to the Collateral Agent and its counsel (i) the
Filing Agent's receipt of all Filing Statements, (ii) that the Filing
Statements have either been submitted for filing in the appropriate
filing offices or will be submitted for filing in the appropriate
offices within ten days following the Issuance Date and (iii) that the
Filing Agent will notify the Collateral Agent and its counsel of the
results of such submissions within 30 days following the Issuance Date.
(w) ASSET BRIDGE PLEDGE AND SECURITY AGREEMENT. The Collateral
Agent shall have received executed counterparts of the Asset Bridge
Pledge and Security Agreement, dated as of the Issuance Date, duly
executed and delivered by an Authorized Officer of Intermediate
Holdings and each Guarantor, together with
(i) the certificates evidencing all of the issued and
outstanding shares of Capital Stock pledged pursuant to the
Asset Bridge Pledge and Security Agreement, which certificates
shall in each case be accompanied by undated powers of
transfer duly executed in blank, or, if any such shares of
Capital Stock of any Domestic Subsidiary of such Obligor
pledged pursuant to the Asset Bridge Pledge and Security
Agreement are uncertificated securities or are held through a
securities intermediary, the Collateral Agent shall have
obtained "control" (as defined in the UCC) over such shares of
Capital Stock and such other instruments and documents as the
Collateral Agent shall deem necessary or, in the reasonable
opinion of the Collateral Agent, desirable under applicable
law to perfect the security interest of the Collateral Agent
in such shares of Capital Stock;
(ii) all promissory notes evidencing intercompany
Indebtedness payable to any Guarantor duly endorsed to the
order of the Collateral Agent;
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(iii) executed UCC financing statements (Form UCC-1)
naming such Obligor as the debtor and the Collateral Agent as
the secured party, or other similar instruments or documents,
suitable for filing under the UCC of all jurisdictions as may
be necessary or, in the opinion of the Collateral Agent,
desirable to perfect the security interest of the Collateral
Agent in the interests of such Obligor in the collateral
pledged pursuant to the Asset Bridge Pledge and Security
Agreement (PROVIDED that perfection of security interests in
motor vehicles shall not be required);
(iv) executed copies of proper UCC termination
statements (Form UCC-3), if any, necessary to release all
Liens and other rights of any Person (other than Liens
permitted under Section 7.2.3 of the Incorporated Agreement as
incorporated by reference in CLAUSE (C) of SECTION 6.2)
(A) in any collateral described in the
applicable Asset Bridge Pledge and Security Agreement
previously granted by any Person, and
(B) securing any of the Indebtedness to be
repaid in connection with the Transaction on or prior
to the Issuance Date,
together with such other UCC termination statements (Form
UCC-3) as the Collateral Agent may reasonably request from
such Obligor; and
(v) certified copies of UCC Requests for Information
or Copies (Form UCC-11), or a similar search report certified
by a party reasonably acceptable to the Collateral Agent,
dated a date reasonably near to the Issuance Date, listing all
effective financing statements which name such Obligor (under
its present names and any previous names) as the debtor and
which are filed in the jurisdictions in which filings are to
be made pursuant to CLAUSE (III) above, together with copies
of such financing statements.
(x) FOREIGN PLEDGE AGREEMENTS. All Foreign Pledge Agreements
shall have been duly executed and delivered by all parties thereto and
shall remain in full force and effect, and all Liens granted to the
Collateral Agent thereunder shall be duly perfected to provide the
Collateral Agent with a security interest in and Lien on all collateral
granted thereunder free and clear of other Liens, except to the extent
consented to by the Collateral Agent.
(y) MORTGAGE. The Collateral Agent shall have received
counterparts of each Mortgage, dated as of the date hereof, duly
executed by each applicable Guarantor, together with
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(i) evidence of the completion (or reasonably
satisfactory arrangements for the completion) of all
recordings and filings of each Mortgage as may be necessary
or, in the reasonable opinion of the Collateral Agent,
desirable effectively to create a valid, perfected first
priority Lien against the properties purported to be covered
thereby;
(ii) updated mortgage lien searches with respect to
certain properties described in CLAUSE (I) or as requested by
the Collateral Agent; and
(iii) such other approvals, opinions, or documents as
the Collateral Agent may request each in form and substance
satisfactory to the Collateral Agent.
(z) MISCELLANEOUS. The Purchasers shall have received such
additional certificates, legal and other opinions and documentation as
they shall reasonably request.
Section 5.2 CONDITIONS TO THE INTERMEDIATE HOLDINGS OBLIGATIONS. The
obligations of Intermediate Holdings to issue and sell the Asset Bridge Notes
pursuant to this Agreement to the Purchasers are subject to the satisfaction, at
or prior to the time of purchase of the Asset Bridge Notes, of the following
conditions:
(a) The representations and warranties of the Purchasers
contained herein shall be true and correct in all material respects on
and as of the Issuance Date as if made on and as of such date.
(b) The issuance and sale of the Asset Bridge Notes by
Intermediate Holdings shall not be prohibited by any applicable law,
court order or governmental regulation.
(c) The Transaction shall have been consummated (or shall be
consummated contemporaneously with the application by Intermediate
Holdings of the proceeds from the issuance and sale of the Asset Bridge
Notes hereunder).
(d) Contemporaneously therewith, Intermediate Holdings shall
have received the purchase price for the Asset Bridge Notes to be
purchased by the Purchasers in accordance with SECTION 2.2(B).
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ARTICLE VI
COVENANTS
Intermediate Holdings agrees that, from and after the Issuance Date
and so long as any Asset Bridge Notes remain outstanding and unpaid, and for the
benefit of the Purchasers and the Holders:
Section 6.1 INCORPORATION OF AFFIRMATIVE COVENANTS FROM THE
INCORPORATED AGREEMENT. Each of Holdings and Intermediate Holdings shall, and
(where and to the extent contemplated by the terms of the Incorporated
Agreement) shall cause each of their Subsidiaries to, comply with the
affirmative covenants set forth in the following Sections of the Incorporated
Agreement:
(a) 7.1.1 (Financial Information, Reports, Notices, etc.)
(excluding clause (l) thereof);
(b) 7.1.2 (Maintenance of Existence; Compliance with Laws,
etc.);
(c) 7.1.3 (Maintenance of Properties);
(d) 7.1.4 (Insurance);
(e) 7.1.5 (Books and Records) (excluding the last sentence
thereof);
(f) 7.1.6 (Environmental Law Covenant); and
(g) 7.1.10 (Use of Proceeds of Holdings Disposition of Capital
Stock or Assets).
Section 6.2 INCORPORATION OF NEGATIVE COVENANTS FROM THE INCORPORATED
AGREEMENT. None of Holdings or Intermediate Holdings shall, nor shall any such
Obligor permit any of its Restricted Subsidiaries to, violate any of the
negative covenants set forth in the following Sections of the Incorporated
Agreement:
(a) 7.2.1 (Business Activities);
(b) 7.2.2 (Indebtedness) (excluding clauses (a), (b), (c),
(e), (g), (h), (i), (j), (l) and (m) thereof (in each case, to the
extent any such clause is applicable to any Designated Restricted
Subsidiary)); PROVIDED that for purposes hereof (i) the aggregate
principal amount of "Obligations" permitted by clause (a) thereof shall
not exceed (A) $380,000,000 minus (B) the aggregate amount of the
permanent payments or prepayments of Term Loans and permanent
reductions of the Revolving Loan Commitment Amount and (ii) in the case
of clause (f) thereof, notwithstanding anything to the contrary
therein, (A) the Designated Restricted Subsidiaries may not
(individually or in the aggregate) incur Indebtedness from any
Restricted Subsidiary in an aggregate outstanding principal amount
exceeding $2,000,000 other than from any other Designated
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Restricted Subsidiary and no Designated Restricted Subsidiary that is a
Foreign Subsidiary may incur Indebtedness from any other Restricted
Subsidiary other than any other Designated Restricted Subsidiary that
is also a Foreign Subsidiary and (B) no Restricted Subsidiary that is
not a Designated Restricted Subsidiary may incur any Indebtedness from
any Designated Restricted Subsidiary;
(c) 7.2.3 (Liens) (excluding clauses (a), (b), (c), (d) and
(e) thereof (in each case, to the extent any such clause is applicable
to any Designated Restricted Subsidiary));
(d) 7.2.5 (Investments) (excluding clauses (e)(iii), (g), (h)
and (i) thereof (in each case, to the extent any such clause is
applicable to any Designated Restricted Subsidiary)); PROVIDED that for
purposes hereof in the case of clause (e)(ii) thereof, notwithstanding
anything to the contrary therein, no Designated Restricted Subsidiary
may make any Investment in any other Restricted Subsidiary other than
in any other Designated Restricted Subsidiary and no Designated
Restricted Subsidiary that is not a Foreign Subsidiary may make any
Investment in any other Restricted Subsidiary other than any other
Designated Restricted Subsidiary that is also not a Foreign Subsidiary;
(e) 7.2.6 (Restricted Payments, etc.); PROVIDED that for
purposes hereof in the case of clause (a) thereof, notwithstanding
anything to the contrary therein, no Designated Restricted Subsidiary
may make a Restricted Payment to any Subsidiary of Holdings other than
Intermediate Holdings or any other Designated Restricted Subsidiary;
(f) 7.2.8 (No Prepayment of Certain Debt) (excluding clause
(c) thereof (as such clause relates to the Obligations evidenced
hereby));
(g) 7.2.9 (Capital Stock of Subsidiaries) (excluding clauses
(x), (y) and (z) thereof (in each case, to the extent any such clause
is applicable to any Designated Restricted Subsidiary));
(h) 7.2.10 (Consolidation, Merger, etc.) (excluding clauses
(a) and (b) thereof (in each case, to the extent any such clause is
applicable to any Designated Restricted Subsidiary));
(i) 7.2.11 (Permitted Dispositions) (excluding clauses (d) and
(f) thereof (in each case, to the extent any such clause is applicable
to any Designated Restricted Subsidiary));
(j) 7.2.12 (Modification of Certain Agreements) (except as
such Section may apply to any of the "Intermediate Asset Bridge
Documents" or the "Intermediate Asset Bridge Note")
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(k) 7.2.13 (Transactions with Affiliates); PROVIDED, HOWEVER,
that for purposes hereof, such Section shall be incorporated by
reference herein as two separate subclauses: (i) for purposes of this
SUBCLAUSE (I), the terms "Restricted Subsidiary", "Restricted
Subsidiaries" and "Domestic Restricted Subsidiaries" as used in such
Section shall be interpreted so that no such term includes any
Designated Restricted Subsidiary and (ii) for purposes of this
SUBCLAUSE (II), (A) the words "Restricted Subsidiary" and "Restricted
Subsidiaries" as used in such Section shall be replaced with the words
"Designated Restricted Subsidiary" and "Designated Restricted
Subsidiaries", (B) the words "or Kalyn/Siebert" and the words "or
unless such arrangement, transaction, or contract is (i) an Investment
made in accordance with Section 7.2.5, (ii) is between the Company and
Domestic Restricted Subsidiaries, between Canadian Restricted
Subsidiaries, between Australian Restricted Subsidiaries, or between
Domestic Restricted Subsidiaries or (iii) pursuant to the Ferronor Loan
Documents" shall be deleted therefrom;
(l) 7.2.14 (Restrictive Agreements, etc.); PROVIDED that (i)
the words "Restricted Subsidiary" and "Restricted Subsidiaries" as used
in such Section shall be replaced with the words "Designated Restricted
Subsidiary" and "Designated Restricted Subsidiaries" and (ii) the lead
in to such Section shall be amended by inserting the words "(other than
the Loan Documents)" immediately following the words "enter into any
agreement" and immediately preceding the word "prohibiting" in such
lead in; and
(m) 7.2.15 (Sale and Leaseback); PROVIDED, HOWEVER, that no
Designated Restricted Subsidiary shall directly or indirectly enter
into any Sale Leasebacks.
Section 6.3 INVESTMENT COMPANY ACT. None of Holdings or Intermediate
Holdings will be or become an open-end investment trust, unit investment trust
or face-amount certificate company that is or is required to be registered under
the Investment Company Act of 1940, as amended.
Section 6.4 USE OF PROCEEDS. The proceeds from the issuance and sale of
the Asset Bridge Notes by Intermediate Holdings pursuant to this Agreement shall
be used to fund the Transaction and to pay related fees and expenses.
Section 6.5 COPIES OF DOCUMENTS AND NOTICES. Holdings and Intermediate
Holdings will, and will cause each of its Designated Restricted Subsidiaries to,
deliver to each Holder any and all certifications, notices and communications
that Holdings, Intermediate Holdings or such Designated Restricted Subsidiary
delivers to the Collateral Agent.
Section 6.6 SYNDICATION EFFORTS. (a) Intermediate Holdings acknowledges
that the Purchasers may transfer (such transfers, collectively, the
"SYNDICATION") all or part of the Asset Bridge Notes issued to the Purchasers on
the Issuance Date to one or more other Holders.
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Holdings and Intermediate Holdings shall, and shall cause the Guarantors to,
actively assist Rail America Funding, Inc. in completing the syndication in a
manner satisfactory to it. Without limiting the foregoing, upon the request of
Rail America Funding, Inc., Holdings and Intermediate Holdings shall, and shall
cause the Guarantors to (i) use commercially reasonable efforts to ensure that
the syndication efforts benefit materially from the Purchasers existing lending
and other financing relationships, (ii) provide direct contact between senior
management and advisors of Holdings, Intermediate Holdings and the Guarantors
and the proposed Holders, (iii) assist in the preparation of a confidential
information memorandum and other marketing materials to be used in connection
with the syndication and (iv) host, with Rail America Funding, Inc. or on one or
more of their respective Affiliates, of one or more meetings of prospective
Holders.
(b) Rail America Funding, Inc. or one of its Affiliates shall manage
all aspects of any syndication, in consultation with Intermediate Holdings
including decisions as to the selection of potential Holders to be approached
and when they will be approached, when their commitments will be accepted, which
potential Holders will participate, and the principal amount of the Asset Bridge
Notes to be transferred to each such Holder. In order to assist Rail America
Funding, Inc. or such Affiliate in any syndication efforts, Holdings and
Intermediate Holdings shall, and shall cause each of the Guarantors to, promptly
prepare and provide to Rail America Funding, Inc., the Purchasers or such
Affiliate all information with respect to Holdings, Intermediate Holdings, the
Transaction and the other transactions contemplated hereby and thereby,
including all financial information and projections, as Rail America Funding,
Inc. or such Affiliate may reasonably request in connection with such
syndication.
ARTICLE VII
EVENTS OF DEFAULT
Section 7.1 EVENTS OF DEFAULT DEFINED; ACCELERATION OF MATURITY; WAIVER
OF DEFAULT. In case one or more of the following (each, an "Event of Default"),
whatever the reason for such Event of Default and whether it shall be voluntary
or involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body, shall have occurred and be continuing:
(a) default in the payment of all or any part of the principal
or premium, if any, on any of the Asset Bridge Notes as and when the
same shall become due and payable either at maturity, upon any
redemption, by declaration or otherwise; or
(b) default in the payment of any installment of interest upon
any of the Asset Bridge Notes or any fees payable under this Agreement
or any amount payable under
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SECTION 2.7 as and when the same shall become due and payable, and
continuance of such default for a period of five days; or
(c) failure on the part of Holdings or Intermediate Holdings
to observe or perform any of the covenants contained in SECTIONS
6.1(G), 6.2, 6.3, or 6.4 of this Agreement; or
(d) failure on the part of Holdings or Intermediate Holdings
to observe or perform any of the other covenants or agreements
contained in the Financing Documents, if such failure shall continue
for a period of 30 days after the date on which written notice thereof
shall have been given to Intermediate Holdings by a Holder; or
(e) there shall be a default in respect of any Indebtedness of
Intermediate Holdings or any of its Designated Restricted Subsidiaries
in an aggregate principal amount in excess of $5,500,000 whether such
Indebtedness now exists or shall hereafter be created (excluding the
Asset Bridge Notes) if such default results in acceleration of the
maturity of such Indebtedness; or Intermediate Holdings or any of its
Designated Restricted Subsidiaries shall fail to pay at maturity any
such Indebtedness whether such Indebtedness now exists or shall
hereafter be created; or
(f) any representation, warranty, certification or statement
made or deemed made by Holdings, Intermediate Holdings or any of its
Designated Restricted Subsidiaries in any Financing Document or which
is contained in any certificate, document or financial or other
statement furnished at any time under or in connection with any
Financing Document shall prove to have been untrue in any material
respect when made or deemed made; or
(g) a Change in Control has occurred; or
(h) any of the Financing Documents to which Holdings,
Intermediate Holdings or a Guarantor is a party shall for any reason
fail to constitute the valid and binding agreement of Holdings,
Intermediate Holdings or such Guarantor as the case may be; or
(i) any Event of Default set forth in Sections 8.1.6
(Judgments) (PROVIDED that the amount "$5,000,000" therein shall be
replaced with the amount "$5,500,000") or 8.1.9 (Bankruptcy,
Insolvency, etc.) of the Incorporated Agreement, in each case to the
extent that each such Section relates to Intermediate Holdings and the
Designated Restricted Subsidiaries,
then, and in each and every such case (other than an Event of Default described
in clauses (b), (c) and (d) of Section 8.1.9 of the Incorporated Agreement as
incorporated by reference in CLAUSE (I) above with respect to any Obligor),
unless the principal of all the Asset Bridge Notes shall have already become due
and payable, the Majority Holders (or, if at such time the Purchasers no
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longer hold at least 50% of the aggregate outstanding principal amount of the
Asset Bridge Notes, Holders of at least 33 1/3% of the aggregate outstanding
principal amount of the Asset Bridge Notes), by notice in writing to
Intermediate Holdings and the Administrative Agent, may declare the entire
outstanding principal amount of the Asset Bridge Notes together with accrued and
unpaid interest thereon to be immediately due and payable; PROVIDED that for so
long as the Loan Documents are in effect, such acceleration shall not become
effective until the earlier of (i) five Business Days after the notice of
acceleration is given to the Administrative Agent or (ii) the date on which the
Indebtedness under the Loan Documents is accelerated. If an Event of Default
described in clauses (b), (c) or (d) of Section 8.1.9 of the Incorporated
Agreement that have been incorporated by reference in CLAUSE (I) above with
respect to any Obligor occurs, the outstanding principal of and accrued and
unpaid interest on the Asset Bridge Notes will be immediately due and payable
without any notice, declaration or other act on the part of the Holders. The
Majority Holders may annul any notice of acceleration or past Defaults (other
than monetary Defaults not yet cured) by delivering a notice of annulment to
Intermediate Holdings and the Administrative Agent. If an Event of Default shall
occur and be continuing, the Purchasers shall have the right to appoint one (1)
representative to serve as a member of the Board of Directors of Holdings;
PROVIDED, HOWEVER, that such right shall terminate if the Purchasers no longer
hold at least 50% of the aggregate outstanding principal amount of the Asset
Bridge Notes.
ARTICLE VIII
LIMITATION ON TRANSFERS
Section 8.1 RESTRICTIONS ON TRANSFER. From and after the Issuance Date,
none of the Asset Bridge Notes shall be transferable except upon the conditions
specified in SECTIONS 8.2 and 8.3, which conditions are intended to ensure
compliance with the provisions of the Securities Act in respect of the Transfer
of any of such Asset Bridge Notes or any interest therein and SECTION 8.4. The
Purchasers will cause any proposed transferee of any Asset Bridge Notes (or any
interest therein) held by it to agree to take and hold such Asset Bridge Notes
(or any interest therein) subject to the provisions and upon the conditions
specified in this SECTION 8.1 and in SECTIONS 8.2 and 8.3.
Section 8.2 RESTRICTIVE LEGENDS. (a) Each Asset Bridge Note issued to
the Purchasers or to a subsequent transferee shall (unless otherwise permitted
by the provisions of SECTION 8.2(B) or SECTION 8.3) include a legend in
substantially the following form:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND MAY NOT
BE OFFERED OR SOLD, UNLESS IT HAS BEEN REGISTERED UNDER SUCH
ACT AND APPLICABLE STATE SECURITIES LAWS
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OR UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE AND THEN
ONLY IN COMPLIANCE WITH THE RESTRICTIONS ON TRANSFER SET FORTH
IN THE SECURITIES PURCHASE AGREEMENT, DATED AS OF FEBRUARY 4,
2000, A COPY OF WHICH MAY BE OBTAINED FROM THE ISSUER OF THIS
SECURITY AT ITS PRINCIPAL EXECUTIVE OFFICE.
(b) Any Holders of Asset Bridge Notes registered pursuant to the
Securities Act and qualified under applicable state securities laws may exchange
such Asset Bridge Notes on transfer for new securities that shall not bear the
legend set forth in CLAUSE (A) of this SECTION 8.2.
Section 8.3 NOTICE OF PROPOSED TRANSFERS. (a) Ten days prior to any
proposed Transfer (other than Transfers of Asset Bridge Notes (i) registered
under the Securities Act, (ii) to an Affiliate of Rail America Funding, Inc. or
a general partnership in which Rail America Funding, Inc., or any of its
Affiliates is one of the general partners or (iii) to be made in reliance on
Rule 144A under the Securities Act) of any Asset Bridge Notes, the holder
thereof shall give written notice to Intermediate Holdings of such holder's
intention to effect such Transfer, setting forth the manner and circumstances of
the proposed Transfer, and which notice shall be accompanied by (A) an opinion
of the proposed transferee's counsel (reasonably satisfactory to Intermediate
Holdings) addressed to Intermediate Holdings to the effect that the proposed
Transfer of such Asset Bridge Notes may be effected without registration under
the Securities Act, (B) such representation letters in form and substance
reasonably satisfactory to Intermediate Holdings to ensure compliance with the
provisions of the Securities Act and (C) such letters in form and substance
reasonably satisfactory to Intermediate Holdings from each such transferee
stating such transferee's agreement to be bound by the terms of this Agreement.
Such proposed Transfer may be effected only if Intermediate Holdings shall have
received such notice of transfer, opinion of counsel, representation letters and
other letters referred to in the immediately preceding sentence, whereupon the
holder of such Asset Bridge Notes shall be entitled to Transfer such Asset
Bridge Notes in accordance with the terms of the notice delivered by the holder
to Intermediate Holdings. Each Asset Bridge Note transferred as above provided
shall bear the legend set forth in SECTION 8.2(A) except that such Asset Bridge
Note shall not bear such legend if the opinion of counsel referred to above is
to the further effect that neither such legend nor the restrictions on Transfer
in SECTIONS 8.1 through 8.3 are required in order to ensure compliance with the
provisions of the Securities Act.
(b) Ten days prior to any proposed Transfer of any Asset Bridge Notes
to be made in reliance on Rule 144A under the Securities Act ("RULE 144A"), the
holder thereof shall give written notice to Intermediate Holdings of such
holder's intention to effect such Transfer, setting forth the manner and
circumstances of the proposed Transfer and certifying that such Transfer will be
made (i) in full compliance with Rule 144A and (ii) to a transferee that (A)
such holder reasonably believes to be a "qualified institutional buyer" within
the meaning of Rule 144A and
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(B) is aware that such Transfer will be made in reliance on Rule 144A. Such
proposed Transfer may be effected only if Intermediate Holdings shall have
received such notice of transfer, whereupon the holder of such Asset Bridge
Notes shall be entitled to Transfer such Asset Bridge Notes in accordance with
the terms of the notice delivered by the holder to Intermediate Holdings. Each
Asset Bridge Note transferred as above provided shall bear the legend set forth
in SECTION 8.2(A).
Section 8.4 RIGHT TO SELL, TRANSFER OR ASSIGN ASSET BRIDGE NOTES.
Subject to SECTIONS 8.1 through 8.3, the Purchasers shall have the absolute and
unconditional right to Transfer Asset Bridge Notes in compliance with applicable
law to any third party at any time.
Section 8.5 REPLACEMENT ASSET BRIDGE NOTES. Within five Business Days
after any Transfer made pursuant to SECTION 8.3(A) or 8.3(B), upon surrender to
Intermediate Holdings of the Asset Bridge Notes subject to such Transfer,
Intermediate Holdings, at its own expense, shall execute and deliver to the
Purchaser in exchange for the Asset Bridge Note or Asset Bridge Notes that are
subject of such Transfer a new Asset Bridge Note or Asset Bridge Notes
registered in the name of the transferee of such Asset Bridge Note or Asset
Bridge Notes (or in such name or names as shall be designated by such
transferee) in an amount equal to the aggregate principal amount of the Asset
Bridge Note or Asset Bridge Notes so transferred, and if the transferring Holder
has not transferred all of the Asset Bridge Notes held by such transferor a new
Asset Bridge Note or Asset Bridge Notes registered in the name of the
transferring holder (or such name or names as shall be designated by such
transferring holder) equal to the aggregate principal amount of the Asset Bridge
Notes surrendered in connection with such Transfer less the aggregate principal
amount of the Asset Bridge Note or Asset Bridge Notes that are the subject of
such Transfer, which shall be dated the effective date of such Transfer and
shall otherwise be in substantially the form of EXHIBIT B attached hereto.
Holdings shall not be required to pay any documentary stamp tax which may be
payable in respect of any Transfer of any Asset Bridge Note from a Holder to any
transferee; PROVIDED that Holdings shall take all such actions as may be
reasonably requested by such Holder or such transferee to minimize or eliminate
any such tax.
ARTICLE IX
COLLATERAL AGENT
Section 9.1 ACTIONS. Each Holder by accepting its Asset Bridge Note and
an interest in the Collateral (as defined in the Security Documents) securing
such Asset Bridge Note hereby appoints Rail America Holdings Funding, Inc. as
its Collateral Agent under and for purposes of each Security Document. Each
Holder authorizes the Collateral Agent to act on behalf of such Holder under
each Security Document and, in the absence of other written instructions from
the Majority Holders received from time to time by the Collateral Agent (with
respect to which the Collateral Agent agrees that it will comply in such
capacity, except as otherwise provided in this
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Section or as otherwise advised by counsel in order to avoid contravention of
applicable law), to exercise such powers thereunder as are specifically
delegated to or required of the Collateral Agent by the terms hereof and
thereof, together with such powers as may be reasonably incidental thereto. Each
Holder hereby indemnifies (which indemnity shall survive any termination of this
Agreement) the Collateral Agent, PRO RATA according to the percentage of the
outstanding aggregate principal amount of such Holder's Asset Bridge Note in
respect of the outstanding aggregate principal amount of all Asset Bridge Notes,
from and against any and all liabilities, obligations, losses, damages, claims,
costs or expenses of any kind or nature whatsoever which may at any time be
imposed on, incurred by, or asserted against, the Collateral Agent in any way
relating to or arising out of any Security Document, including reasonable
attorneys' fees, and as to which the Collateral Agent is not reimbursed by
Holdings or Intermediate Holdings; PROVIDED, HOWEVER, that no Holder shall be
liable for the payment of any portion of such liabilities, obligations, losses,
damages, claims, costs or expenses which are determined by a court of competent
jurisdiction in a final proceeding to have resulted from the Collateral Agent's
gross negligence or wilful misconduct. The Collateral Agent shall not be
required to take any action under any Security Document, or to prosecute or
defend any suit in respect of any Security Document, unless it is indemnified
hereunder to its satisfaction. If any indemnity in favor of the Collateral Agent
shall be or become, in the Collateral Agent's determination, inadequate, the
Collateral Agent may call for additional indemnification from the Holders and
cease to do the acts indemnified against hereunder until such additional
indemnity is given.
Section 9.2 EXCULPATION. Neither the Collateral Agent nor any of its
directors, officers, employees or agents shall be liable to any Holder for any
action taken or omitted to be taken by it under any Security Document, or in
connection herewith or therewith, except for its own wilful misconduct or gross
negligence, nor responsible for any recitals or warranties herein or therein,
nor for the effectiveness, enforceability, validity or due execution of any
Security Document, nor for the creation, perfection or priority of any Liens
purported to be created by any of the Security Documents, or the validity,
genuineness, enforceability, existence, value or sufficiency of any collateral
security, nor to make any inquiry respecting the performance by any Obligor of
its Obligations. Any such inquiry which may be made by the Collateral Agent
shall not obligate it to make any further inquiry or to take any action. The
Collateral Agent shall be entitled to rely upon advice of counsel concerning
legal matters and upon any notice, consent, certificate, statement or writing
which the Collateral Agent believes to be genuine and to have been presented by
a proper Person.
Section 9.3 SUCCESSOR. The Collateral Agent may resign as such at any
time upon at least 30 days' prior notice to Holdings and Intermediate Holdings
and all Holders. If the Collateral Agent at any time shall resign, the Majority
Holders may appoint another Holder as a successor Collateral Agent which shall
thereupon become the Collateral Agent under the Security Documents. If no
successor Collateral Agent shall have been so appointed by the Majority Holders,
and shall have accepted such appointment, within 30 days after the retiring
Collateral
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Agent's giving notice of resignation, then the retiring Collateral Agent may, on
behalf of the Holders, appoint a successor Collateral Agent, which shall be one
of the Holders or a commercial banking institution organized under the laws of
the U.S. (or any State thereof) or a U.S. branch or agency of a commercial
banking institution, and having a combined capital and surplus of at least
$250,000,000; PROVIDED, HOWEVER, that if, such retiring Collateral Agent is
unable to find a commercial banking institution which is willing to accept such
appointment and which meets the qualifications set forth above in this SECTION
9.3, the retiring Collateral Agent's resignation shall nevertheless thereupon
become effective and the Holders shall assume and perform all of the duties of
the Collateral Agent under the Security Documents until such time, if any, as
the Majority Holders appoint a successor as provided for above. Upon the
acceptance of any appointment as Collateral Agent hereunder by a successor
Collateral Agent, such successor Collateral Agent shall be entitled to receive
from the retiring Collateral Agent such documents of transfer and assignment as
such successor Collateral Agent may reasonably request, and shall thereupon
succeed to and become vested with all rights, powers, privileges and duties of
the retiring Collateral Agent, and the retiring Collateral Agent shall be
discharged from its duties and obligations under the Security Documents. After
any retiring Collateral Agent's resignation hereunder as the Collateral Agent,
the provisions of this ARTICLE shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was the Collateral Agent under the
Security Documents.
Section 9.4 ASSET BRIDGE NOTES HELD BY THE COLLATERAL AGENT. The
Collateral Agent shall have the same rights and powers with respect to the Asset
Bridge Notes held by it or any of its Affiliates as any other Holder and may
exercise the same as if it were not the Collateral Agent. The Collateral Agent
and each of its Affiliates may accept deposits from, lend money to, and
generally engage in any kind of business with Holdings, Intermediate Holdings or
any Subsidiary or Affiliate of Holdings as if the Collateral Agent were not the
Collateral Agent under the Security Documents
Section 9.5 CREDIT DECISIONS. Each Holder acknowledges that it has,
independently of the Collateral Agent and each other Holder, and based on such
Holder's review of the financial information of Holdings, Intermediate Holdings
and the Restricted Subsidiaries, the Financing Documents (the terms and
provisions of which being satisfactory to such Holder) and such other documents,
information and investigations as such Holder has deemed appropriate, made its
own credit decision to hold its Asset Bridge Note. Each Holder also acknowledges
that it will, independently of the Collateral Agent and each other Holder, and
based on such other documents, information and investigations as it shall deem
appropriate at any time, continue to make its own credit decisions as to
exercising or not exercising from time to time any rights and privileges
available to it under the Financing Documents.
Section 9.6 RELIANCE BY THE COLLATERAL AGENT. The Collateral Agent
shall be entitled to rely upon any certification, notice or other communication
(including any thereof by telephone, telecopy, telegram or cable) believed by it
to be genuine and correct and to have been signed or
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sent by or on behalf of the proper Person, and upon advice and statements of
legal counsel, independent accountants and other experts selected by the
Collateral Agent. As to any matters not expressly provided for by the Security
Documents, the Collateral Agent shall in all cases be fully protected in acting,
or in refraining from acting, hereunder or thereunder in accordance with
instructions given by the Majority Holders or all of the Holders as is required
in such circumstance, and such instructions of such Holders and any action taken
or failure to act pursuant thereto shall be binding on all Secured Parties.
Section 9.7 DEFAULTS. The Collateral Agent shall not be deemed to have
knowledge or notice of the occurrence of a Default unless the Collateral Agent
has received a written notice from a Holder, Holdings or Intermediate Holdings
specifying such Default and stating that such notice is a "Notice of Default".
In the event that the Collateral Agent receives such a notice of the occurrence
of a Default, the Collateral Agent shall give prompt notice thereof to the
Holders. The Collateral Agent shall (subject to SECTION 11.2) take such action
with respect to such Default as shall be directed by the Majority Holders;
PROVIDED, that unless and until the Collateral Agent shall have received such
directions, the Collateral Agent may (but shall not be obligated to) take such
action, or refrain from taking such action, with respect to such Default as it
shall deem advisable in the best interest of the Holders except to the extent
that this Agreement expressly requires that such action be taken, or not be
taken, only with the consent or upon the authorization of the Majority Holders
or all Holders, as applicable.
Section 9.8 PAYMENT OF COSTS AND EXPENSES. Holdings and Intermediate
Holdings jointly and severally agree to pay on demand all expenses of the
Collateral Agent (including the reasonable fees and out-of-pocket expenses of
Mayer, Brown & Platt, counsel to the Collateral Agent and of local counsel, if
any, who may be retained by or on behalf of the Collateral Agent) in connection
with
(i) the negotiation, preparation, execution and delivery of
each Security Document, including schedules and exhibits, and any
amendments, waivers, consents, supplements or other modifications to
any Security Document as may from time to time hereafter be required,
whether or not the transactions contemplated hereby are consummated;
and
(ii) the filing or recording of any Security Document
(including the Filing Statements) and all amendments, supplements,
amendment and restatements and other modifications to any thereof,
searches made following the Issuance Date in jurisdictions where Filing
Statements (or other documents evidencing Liens in favor of the Secured
Parties) have been recorded and any and all other documents or
instruments of further assurance required to be filed or recorded by
the terms of any Security Document; and
(iii) the preparation and review of the form of any document
or instrument relevant to any Security Document.
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Holdings and Intermediate Holdings further jointly and severally agree to pay,
and to save each Secured Party harmless from all liability for, any stamp or
other taxes which may be payable in connection with the execution or delivery of
each Security Document. Holdings and Intermediate Holdings also jointly and
severally agree to reimburse each Secured Party upon demand for all reasonable
out-of-pocket expenses (including reasonable attorneys' fees and legal expenses
of counsel to each Secured Party) incurred by such Secured Party in connection
with the enforcement of the Security Documents.
Section 9.9 INDEMNIFICATION. In consideration of the execution and
delivery of this Agreement by each Purchaser and the continued maintainenance by
the Holders of the Indebtedness evidenced by the Asset Bridge Notes, Holdings
and Intermediate Holdings, jointly and severally, hereby indemnify, exonerate
and hold each Secured Party and each of their respective officers, directors,
employees and agents (collectively, the "INDEMNIFIED SECURED PARTIES") free and
harmless from and against any and all actions, causes of action, suits, losses,
costs, liabilities and damages, and expenses incurred in connection therewith
(irrespective of whether any such Indemnified Secured Party is a party to the
action for which indemnification hereunder is sought), including reasonable
attorneys' fees and disbursements, whether incurred in connection with actions
between or among the parties hereto or the parties hereto and third parties
(collectively, the "INDEMNIFIED LIABILITIES"), incurred by the Indemnified
Secured Parties or any of them as a result of, or arising out of, or relating to
(i) the entering into and performance of any Security Document
by any of the Indemnified Secured Parties (including any action brought
by or on behalf of Holdings or Intermediate Holdings in connection with
the administration thereof, provided that any such action is resolved
in favor of such Indemnified Secured Party);
(ii) any investigation, litigation or proceeding related to
any environmental cleanup, audit, compliance or other matter relating
to the protection of the environment on, under or arising from any
operations or property owned, leased or operated upon (including right
of way easements) of any Designated Restricted Subsidiary, Intermediate
Holdings or Holdings or the Release by any Designated Restricted
Subsidiary, Intermediate Holdings or Holdings of any Hazardous
Material;
(iii) the presence on or under, or the escape, seepage,
leakage, spillage, discharge, emission, discharging or releases from,
any operations of any Designated Restricted Subsidiary, Intermediate
Holdings or Holdings on any real property owned, leased, or operated
upon (including right of way easements) by any Obligor or any
Subsidiary thereof of any Hazardous Material (including any losses,
liabilities, damages, injuries, costs, expenses or claims asserted or
arising under any Environmental Law), regardless of whether caused by,
or within the control of, such Obligor or Subsidiary; or
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(iv) each Secured Party's Environmental Liability (the
indemnification herein shall survive repayment of the Obligations and
any transfer of the property of any Designated Restricted Subsidiary,
Intermediate Holdings or Holdings by foreclosure or by a deed in lieu
of foreclosure for any Secured Party's Environmental Liability,
regardless of whether caused by, or within the control of, such
Designated Restricted Subsidiary, Intermediate Holdings or Holdings);
except for Indemnified Liabilities arising for the account of a particular
Indemnified Secured Party by reason of the relevant Indemnified Secured Party's
gross negligence or wilful misconduct. Each Designated Restricted Subsidiary,
Intermediate Holdings and Holdings and its successors and assigns hereby waive,
release and agree not to make any claim or bring any cost recovery action
against, any Indemnified Secured Party under CERCLA or any state equivalent, or
any similar law now existing or hereafter enacted. It is expressly understood
and agreed that to the extent that any Indemnified Secured Party is strictly
liable under any Environmental Laws, the obligation of each Designated
Restricted Subsidiary, Intermediate Holdings and Holdings to such Indemnified
Secured Party under this indemnity shall likewise be without regard to fault on
the part of any Designated Restricted Subsidiary, Intermediate Holdings or
Holdings with respect to the violation or condition which results in liability
of an Indemnified Secured Party. If and to the extent that the foregoing
undertaking may be unenforceable for any reason, each Designated Restricted
Subsidiary, Intermediate Holdings and Holdings agrees to make the maximum
contribution to the payment and satisfaction of each of the Indemnified
Liabilities which is permissible under applicable law.
ARTICLE X
GUARANTEES
Section 10.1 GUARANTEES. (a) Subject to SECTION 10.2, each of the
Guarantors jointly and severally unconditionally guarantees to each Holder,
irrespective of the validity and enforceability of the other provisions of this
Agreement, or of the Financing Documents, the Asset Bridge Notes and the
obligations of Intermediate Holdings hereunder or thereunder, that: (i) the
principal of, premium, if any, and interest, if any, on the Asset Bridge Notes
shall be promptly paid in full when due, whether at maturity, by acceleration,
redemption or otherwise, and (to the extent permitted by law) interest on the
overdue principal of, premium, if any, and interest, if any, on the Asset Bridge
Notes (including all reasonable costs of collection and enforcement thereof and
interest thereon which would be owing by Intermediate Holdings but for the
effect of any bankruptcy law, if any), and all other obligations of Intermediate
Holdings to the Holders under this Agreement, the Financing Documents and the
Asset Bridge Notes shall be promptly paid in full when due or performed, all in
accordance with the terms of this Agreement, the Financing Documents and the
Asset Bridge Notes; and (ii) in case of any extension of time of payment or
renewal of any Asset Bridge Notes, or the issuance of any of such other
obligations,
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that the same shall be promptly paid in full when due or performed in accordance
with their terms whether at stated maturity, by acceleration, redemption or
otherwise. Failing payment when due of any amount so guaranteed for whatever
reason, the Guarantors shall be jointly and severally and unconditionally
obligated to pay the same immediately whether or not such failure to pay has
become an Event of Default which could cause acceleration pursuant to SECTION
7.1. Each Guarantor agrees that this is a continuing guarantee of payment and
not merely a guarantee of collection.
(b) The Guarantors hereby agree that, subject to SECTION 10.2, their
obligations hereunder shall be unconditional and absolute and, without limiting
the generality of the foregoing, shall not be released, discharged or otherwise
affected by:
(i) any extension, renewal, settlement, compromise, waiver or
release in respect of any obligation of Intermediate Holdings under
this Agreement, the Financing Documents or the Asset Bridge Notes, by
operation of law or otherwise;
(ii) any modification or amendment of or supplement to any
other provisions of this Agreement, or to the Financing Documents or
the Asset Bridge Notes with the consent of the Guarantors, which
consent shall not be unreasonably withheld;
(iii) any release, non-perfection or invalidity of any direct
or indirect security for, or any other guarantee of, any of the
obligations guaranteed by this ARTICLE X;
(iv) any change in the corporate existence, structure or
ownership of Intermediate Holdings, or any insolvency, bankruptcy,
reorganization or other similar proceeding affecting Intermediate
Holdings or its assets or any resulting release or discharge of any
obligation of Intermediate Holdings contained in this Agreement, the
Financing Documents or the Asset Bridge Notes;
(v) the existence of any claim, set-off or other rights which
any Guarantor may have at any time against Intermediate Holdings or any
other Person, whether in connection herewith or with an unrelated
transactions, PROVIDED that nothing herein shall prevent the assertion
of any such claim by separate suit or compulsory counterclaim;
(vi) any invalidity or unenforceability relating to or against
Intermediate Holdings for any reason of this Agreement, the Financing
Documents or the Asset Bridge Notes, or any provision of applicable law
or regulation purporting to prohibit the payment by Intermediate
Holdings of the principal of or interest on the Asset Bridge Notes or
any other amount payable by it under this Agreement, the Financing
Documents or the Asset Bridge Notes;
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(vii) any other act or omission to act or delay of any kind by
Intermediate Holdings or any other Person or any other circumstance
whatsoever which might, but for the provisions of this paragraph,
constitute a legal or equitable discharge of any Guarantor's
obligations hereunder; or
(viii) any issuance of Additional Asset Bridge Notes pursuant
to SECTION 2.5(D).
(c) Each Guarantor hereby waives diligence, presentment, demand of
payment, filing of claims with a court in the event of insolvency or bankruptcy
of Intermediate Holdings, any right to require a proceeding first against
Intermediate Holdings, protest, notice and all demands whatsoever and covenants
that, subject to this Article X, this Guarantee shall not be discharged except
by complete performance of all obligations on and with respect to the Asset
Bridge Notes, this Agreement and the Financing Documents.
(d) If any Holder is required by any court or otherwise to return to
Intermediate Holdings or any of the Guarantors, or any custodian, trustee,
liquidator or other similar official acting in relation to either Intermediate
Holdings or any of the Guarantors, any amount paid to such Holder, this
Guarantee, to the extent of the amount so returned, shall be reinstated in full
force and effect.
(e) Each Guarantor agrees that it shall not be entitled to any right of
subrogation in relation to the Holders in respect of any obligations guaranteed
hereby until payment in full of all obligations guaranteed hereby. Each
Guarantor further agrees that, as between the Guarantors, on the one hand, and
the Holders, on the other hand, (x) the maturity of the obligations guaranteed
hereby may be accelerated as provided in SECTION 7.1 notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby and (y) in the event of any declaration of
acceleration of such obligations as provided in SECTION 7.1, such obligations
(whether or not due and payable) shall forthwith become due and payable by the
Guarantors for the purpose of this Guarantee. The Guarantors shall have the
right to seek contribution from any non-paying Guarantor so long as the exercise
of such right does not impair the rights of the Holders under this Guarantee.
Section 10.2 LIMITATION ON GUARANTOR LIABILITY. Each Guarantor, and by
its acceptance of Asset Bridge Notes, each Holder, hereby confirms that it is
the intention of all such parties that this Guarantee not constitute a
fraudulent transfer or conveyance for purposes of any bankruptcy law, the
Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any
similar federal or state law to the extent applicable to this Guarantee. To
effectuate the foregoing intention, the Holders and the Guarantors hereby
irrevocably agree that the obligations of each Guarantor under this Guarantee
shall be limited to the maximum amount as will, after giving effect to such
maximum amount and all other contingent and fixed liabilities of such Guarantor
that are relevant under such laws, and after giving effect to any collections
from, rights to receive contribution from or payments made by or on behalf of
any other Guarantor in respect
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of the obligations of such other Guarantor under this Guarantee, result in the
obligations of such Guarantor under the Guarantee not constituting a fraudulent
transfer or conveyance.
Section 10.3 CONSOLIDATION OR MERGER OF GUARANTORS. Without limiting
the provisions of CLAUSE (H) of SECTION 6.2, no Guarantor may consolidate with
or merge with or into (whether or not such Guarantor is the surviving Person)
another corporation, Person or entity whether or not affiliated with such
Guarantor unless such corporation, person or entity is a Guarantor.
ARTICLE XI
MISCELLANEOUS
Section 11.1 NOTICES. All notices, demands and other communications to
any party hereunder shall be in writing (including facsimile or similar writing)
and shall be given to such party at its address set forth on the signature pages
hereof, or such other address as such party may hereinafter specify for the
purpose. Each such notice, demand or other communication shall be effective (i)
if given by facsimile, when such facsimile is transmitted to the facsimile
number specified on the signature page hereof, or (ii) if given by overnight
courier, addressed as aforesaid or by any other means, when delivered at the
address specified in this Section.
Section 11.2 NO WAIVERS; AMENDMENTS. (a) No failure or delay on the
part of any party in exercising any right, power or remedy hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right, power or remedy preclude any other or further exercise thereof or
the exercise of any other right, power or remedy. The remedies provided for
herein are cumulative and are not exclusive of any remedies that may be
available to any party at law or in equity or otherwise.
(b) Any provision of this Agreement may be amended, supplemented or
waived if, but only if, such amendment, supplement or waiver is in writing and
is signed by Intermediate Holdings and the Majority Holders; PROVIDED, that
without the consent of each Holder of any Asset Bridge Note affected thereby, an
amendment, supplement or waiver may not (a) reduce the aggregate principal
amount of Asset Bridge Notes whose Holders must consent to an amendment,
supplement or waiver, (b) reduce the rate or extend the time for payment of
interest on any Asset Bridge Note, (c) reduce the principal amount of or extend
the stated maturity of any Asset Bridge Note or (d) make any Asset Bridge Note
payable in money or property other than as stated in the Asset Bridge Notes. In
determining whether the Holders of the requisite principal amount of Asset
Bridge Notes have concurred in any direction, consent, or waiver as provided in
this Agreement or in the Asset Bridge Notes, Asset Bridge Notes which are owned
by Intermediate Holdings or any other obligor on or guarantor of the Asset
Bridge Notes, or, except for Rail America Funding, Inc. and its Affiliates by
any Person controlling, controlled by, or under common control with any of the
foregoing, shall be disregarded and deemed not to be
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outstanding for the purpose of any such determination; and PROVIDED, FURTHER,
that no such amendment, supplement or waiver which affects (x) the rights of the
Purchasers and its Affiliates otherwise than solely in their capacities as
Holders of Asset Bridge Notes shall be effective with respect to them without
their prior written consent or (y) the interests, rights or obligations of the
Collateral Agent (in its capacity as the Collateral Agent) shall be effective
without the Collateral Agent's prior written consent.
Section 11.3 INDEMNIFICATION. (a) Intermediate Holdings (the
"INDEMNIFYING PARTY") agrees to indemnify and hold harmless each Purchaser, its
respective Affiliates, and each Person, if any, who controls such Purchaser, or
any of its Affiliates, within the meaning of the Securities Act or the Exchange
Act (a "CONTROLLING PERSON"), and the respective partners, agents, employees,
officers and directors of such Purchaser, its Affiliates and any such
Controlling Person (each an "INDEMNIFIED PARTY," and collectively, the
"INDEMNIFIED PARTIES"), from and against any and all losses, claims, damages,
liabilities and expenses (including, without limitation and as incurred,
reasonable costs of investigating, preparing or defending any such claim or
action, whether or not such Indemnified Party is a party thereto) arising out
of, or in connection with any activities contemplated by this Agreement or any
other services rendered in connection herewith, including, but not limited to,
losses, claims, damages, liabilities or expenses arising out of or based upon
any untrue statement or any alleged untrue statement of a material fact or any
omission or any alleged omission to state a material fact in any of the
disclosure or offering or confidential information documents (the "DISCLOSURE
DOCUMENTS") pertaining to any of the transactions or proposed transactions
contemplated herein, including any eventual refinancing or resale of the Asset
Bridge Notes, PROVIDED, that the Indemnifying Party will not be responsible for
any claims, liabilities, losses, damages or expenses that are determined by
final judgment of a court of competent jurisdiction to result from such
Indemnified Party's gross negligence, willful misconduct or bad faith. The
Indemnifying Party also agrees that (i) no Purchaser shall have liability
(except for breach of provisions of this Agreement) for claims, liabilities,
damages, losses or expenses, including legal fees, incurred by the Indemnifying
Party in connection with this Agreement, unless they are determined by final
judgment of a court of competent jurisdiction to result from such Purchaser's
gross negligence, willful misconduct or bad faith and (ii) no Purchaser shall in
any event have any liability to Intermediate Holdings on any theory of liability
for special or punitive damages (as opposed to direct or actual damages) arising
out of, or in connection with, or as a result of this Agreement.
(b) If any action shall be brought against an Indemnified Party with
respect to which indemnity may be sought against the Indemnifying Party under
this Agreement, such Indemnified Party shall promptly notify the Indemnifying
Party in writing and the Indemnifying Party shall, if requested by such
Indemnified Party or if the Indemnifying Party desires to do so, assume the
defense thereof, including the employment of counsel reasonably satisfactory to
such Indemnified Party and payment of all reasonable fees and expenses. The
failure to so notify the Indemnifying Party shall not affect any obligations the
Indemnifying Party may have to such Indemnified Party under this Agreement or
otherwise unless the Indemnifying Party is materially
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adversely affected by such failure. Such Indemnified Party shall have the right
to employ separate counsel in such action and participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense of
such Indemnified Party, unless: (i) the Indemnifying Party has failed to assume
the defense and employ counsel reasonably satisfactory to such Indemnified Party
or (ii) the named parties to any such action (including any impleaded parties)
include such Indemnified Party and the Indemnifying Party, and such Indemnified
Party shall have been advised by counsel that there may be one or more legal
defenses available to it which are different from or additional to those
available to the Indemnifying Party, in which case, if such Indemnified Party
notifies the Indemnifying Party in writing that it elects to employ separate
counsel at the expense of the Indemnifying Party, the Indemnifying Party shall
not have the right to assume the defense of such action or proceeding on behalf
of such Indemnified Party, PROVIDED, HOWEVER, that the Indemnifying Party shall
not, in connection with any one such action or proceeding or separate but
substantially similar or related actions or proceedings in the same jurisdiction
arising out of the same general allegations or circumstances, be responsible
hereunder for the reasonable fees and expenses of more than one such firm of
separate counsel, in addition to any local counsel, which counsel shall be
designated by the Purchasers. The Indemnifying Party shall not be liable for any
settlement of any such action effected without the written consent of the
Indemnifying Party (which shall not be unreasonably withheld) and the
Indemnifying Party agrees to indemnify and hold harmless each Indemnified Party
from and against any loss or liability by reasons of settlement of any action
effected with the consent of the Indemnifying Party. In addition, the
Indemnifying Party will not, without the prior written consent of the
Indemnified Party, settle or compromise or consent to the entry of any judgment
in or otherwise seek to terminate any pending or threatened action, claim, suit
or proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not any Indemnified Party is a party thereto) unless such
settlement, compromise, consent or termination includes an express unconditional
release of the Purchasers and the other Indemnified Parties, reasonably
satisfactory in form and substance to the Purchasers, from all liability arising
out of such action, claim, suit or proceeding.
(c) If for any reason the foregoing indemnity is unavailable (otherwise
than pursuant to the express terms of such indemnity) to an Indemnified Party or
insufficient to hold an Indemnified Party harmless, then in lieu of indemnifying
such Indemnified Party, the Indemnifying Party shall contribute to the amount
paid or payable by such Indemnified Party as a result of such claims,
liabilities, losses, damages, or expenses (i) in such proportion as is
appropriate to reflect the relative benefits received by the Indemnifying Party
on the one hand and by a Purchaser on the other from the transactions
contemplated by this Agreement or (ii) if the allocation provided by clause (i)
above is not permitted under applicable law, in such proportion as is
appropriate to reflect not only the relative benefits received by the
Indemnifying Party on the one hand and such Purchaser on the other, but also the
relative fault of the Indemnifying Party and such Purchaser as well as any other
relevant equitable considerations. Notwithstanding the provisions of this
SECTION 11.3, the aggregate contribution of all Indemnified Parties shall not
exceed the amount of fees actually received by the Purchasers
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pursuant to this Agreement. It is hereby further agreed that the relative
benefits to the Indemnifying Party on the one hand and a Purchaser on the other
with respect to the transactions contemplated hereby shall be deemed to be in
the same proportion as (i) the aggregate principal amount of Asset Bridge Notes
issued by Intermediate Holdings bears to (ii) the fees actually received by such
Purchaser pursuant to this Agreement. The relative fault of the Indemnifying
Party on the one hand and a Purchaser on the other with respect to the
transactions contemplated hereby shall be determined by reference to, among
other things, whether any untrue or alleged untrue statement of material fact or
the omission or alleged omission to state a material fact related to information
supplied by the Indemnifying Party or by such Purchaser and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation.
(d) The indemnification, contribution and expense reimbursement
obligations set forth in this SECTION 11.3 (i) shall be in addition to any
liability the Indemnifying Party may have to any Indemnified Party at common law
or otherwise, (ii) shall survive the termination of this Agreement and the
payment in full of the Asset Bridge Notes and (iii) shall remain operative and
in full force and effect regardless of any investigation made by or on behalf of
the Purchasers or any other Indemnified Party.
Section 11.4 EXPENSES. Intermediate Holdings agrees to pay all
reasonable out-of-pocket costs, expenses and other payments of the Purchasers in
connection with the purchase and sale of the Asset Bridge Notes as contemplated
by this Agreement including without limitation (i) reasonable fees and
disbursements of special counsel and any local counsel for the Purchasers
incurred in connection with the preparation of this Agreement, (ii) all
reasonable out-of-pocket expenses of the Purchasers, including reasonable fees
and disbursements of counsel, in connection with any waiver or consent hereunder
or any amendment hereof or any Default or alleged Default hereunder and (iii) if
an Event of Default occurs, all reasonable out-of-pocket expenses incurred by
the Purchasers and each Holder of Asset Bridge Notes, including reasonable fees
and disbursements of a single counsel (which counsel shall be selected by the
Purchasers if the Purchaser is a Holder of Asset Bridge Notes when such Event of
Default occurs), in connection with such Event of Default and collection,
bankruptcy, insolvency and other enforcement proceedings resulting therefrom.
Section 11.5 PAYMENT. Intermediate Holdings agrees that, so long as a
Purchaser shall own any Asset Bridge Notes purchased by it from Intermediate
Holdings hereunder, Intermediate Holdings will make payments to such Purchaser
of all amounts due thereon by wire transfer by 1:00 P.M. (New York City time) on
the date of payment to such account as is specified beneath such Purchaser's
name on the signature page hereof or to such other account or in such other
similar manner as such Purchaser may designate to Intermediate Holdings in
writing.
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Section 11.6 SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and shall inure to the benefit of Holdings, Intermediate Holdings, the
Purchasers, the Guarantors and their respective successors and assigns; PROVIDED
that none of Holdings, Intermediate Holdings or any Guarantor may assign or
otherwise transfer its rights or obligations under this Agreement to any other
Person without the prior written consent of the Majority Holders. All provisions
hereunder purporting to give rights to the Purchasers and its Affiliates, or to
Holders are for the express benefit of such Persons.
Section 11.7 BROKERS. Intermediate Holdings represents and warrants
that, except for Donaldson, Lufkin & Jenrette Securities Corporation and
Barclays Capital, it has not employed any broker, finder, financial advisor or
investment banker who might be entitled to any brokerage, finder's or other fee
or commission in connection with the Transaction or the sale of the Asset Bridge
Notes.
Section 11.8 NEW YORK LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY
TRIAL. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
LAWS OF THE STATE OF NEW YORK. EACH PARTY HERETO HEREBY SUBMITS TO THE
NONEXCLUSIVE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT 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 PARTY HERETO 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. EACH PARTY HERETO HEREBY IRREVOCABLY
WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
Section 11.9 SEVERABILITY. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.
Section 11.10 COUNTERPARTS. This Agreement may be executed 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.
Section 11.11 CONFIDENTIALITY. (a) Intermediate Holdings acknowledges
and agrees that: (i) the Purchasers and certain of their respective Affiliates
are a full service financial firm and as
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such may from time to time effect transactions for their own account or the
account of customers, and hold positions in loans or options on loans of Persons
that may be the subject of this arrangement; (ii) the Purchasers may employ the
services of Donaldson, Lufkin & Jenrette Securities Corporation and its
Affiliates in providing certain services hereunder and may, subject to CLAUSE
(B) below, exchange with such entities information concerning Holdings,
Intermediate Holdings and the Guarantors, and such Affiliates will be entitled
to the benefits afforded the Purchasers hereunder, and (iii) the Purchasers or
their respective Affiliates may be providing financing or other services to
Persons whose interests may conflict with the interest of Holdings, Intermediate
Holdings and the Guarantors.
(b) The Purchasers and each other Holder agrees to keep confidential
any confidential information; PROVIDED that nothing herein shall prevent the
Purchasers or such other Holder from disclosing any such information (i) to any
Person which receives such information having been made aware of, and which
agrees to maintain, the confidential nature thereof in order to facilitate or
enable the Purchasers or such other Holder to syndicate, sell transfer
(including, without limitation, the transfer of a participation in the Asset
Bridge Notes) or assign any portion of its notes, (ii) to any Holder, (iii) to
its employees, directors, agents, attorneys, accountants and other professional
advisors which receive such information having been made aware of the
confidential nature thereof, (iv) upon the request or demand of any Governmental
Authority having jurisdiction over either Purchaser or such other Holder, (v) in
response to any order of any court or other Governmental Authority or as may
otherwise be required pursuant to any legal requirement, (vi) which has been
publicly disclosed other than in breach of this Agreement, or (vii) in
connection with the exercise of any remedy hereunder.
Section 11.12 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties made hereunder and in any document, certificate
or statement delivered pursuant hereto or in connection herewith shall survive
the execution and delivery of this Agreement and the issuance of the Asset
Bridge Notes.
Section 11.13 CONSTRUCTION. Each covenant contained herein shall be
construed (absent express provision to the contrary) as being independent of
each other covenant contained herein, so that compliance with any one covenant
shall not (absent such an express contrary provision) be deemed to excuse
compliance with any other covenant. Where any provision herein refers to action
to be taken by any Person, or which such person is prohibited from taking, such
provision shall be applicable whether such action is taken directly or
indirectly by such Person.
Section 11.14 INTEGRATION. This Agreement represents the agreement of
the parties hereto with respect to the subject matter hereof, and there are no
promises, undertakings, representations or warranties by Holdings, Intermediate
Holdings or the Purchasers relative to the subject matter hereof not expressly
set forth herein or in the other Financing Documents.
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Section 11.15 REPLACEMENT ASSET BRIDGE NOTES. If any mutilated Asset
Bridge Note is surrendered to Intermediate Holdings or Intermediate Holdings
receives reasonably satisfactory evidence of the destruction, loss or theft of
any Asset Bridge Note (which evidence shall be, in the case of an institutional
investor, notice from such institutional investor of such ownership and such
destruction, loss or theft), Intermediate Holdings shall, at the expense of the
holder of such Asset Bridge Note, execute and deliver, in lieu thereof, a new
Asset Bridge Note, dated and bearing interest from the date to which interest
shall have been paid on such lost, stolen, destroyed or mutilated Asset Bridge
Note or dated the date of such lost, stolen, destroyed or mutilated Asset Bridge
Note if no interest shall have been paid thereon.
Section 11.16 HEADINGS. Section headings used herein and in the table
of contents are for convenience only and are not to effect the construction of,
or be taken into consideration in interpreting this Agreement and the other
Financing Documents.
-50-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers, as of the date first
above written.
PALM BEACH RAIL HOLDING, INC.
By: /s/ Joseph B. Doherty
------------------------------------
Name: Joseph B. Doherty
Title: Treasurer
Address for Notices:
5300 Broken Sound Blvd. N.W.
Boca Raton, FL 33487
Telecopier: (561) 994-3929
Attention: Joseph B. Doherty
GUARANTORS:
RAILAMERICA, INC.
By: /s/ Joseph B. Doherty
------------------------------------
Name: Joseph B. Doherty
Title: Treasurer
Address for Notices:
5300 Broken Sound Blvd. N.W.
Boca Raton, FL 33487
Telecopier: (561) 994-3929
Attention: Joseph B. Doherty
KALYN/SIEBERT I, INCORPORATED
By:
------------------------------------
Name:
Title:
KS BOCA, INC.
By:
------------------------------------
Name:
Title:
KALYN/SIEBERT, L.P.
By Kalyn/Siebert I, Incorporated, its general
partner
By:
------------------------------------
Name:
Title:
COMMITMENT: PURCHASERS:
----------- RAIL AMERICA HOLDINGS FUNDING,
$55,000,000 INC.
By:
------------------------------------
Name:
Title:
Address for Notices:
277 Park Avenue
New York, NY 10172
Telecopier: 212-892-7542
Attention: Joe Adipietro
Wiring Instructions:
ABA#
A/C#
=========== Attention:
$55,000,000
Dates Referenced Herein and Documents Incorporated by Reference
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