Exhibit 10.6

 

$60,000,000

 

EXIDE TECHNOLOGIES

 

Floating Rate Convertible Senior Subordinated Notes due 2013

 

PURCHASE AGREEMENT

 

March 15, 2005

 

Deutsche Bank Securities Inc.

Credit Suisse First Boston LLC

c/o Deutsche Bank Securities Inc.

    60 Wall Street

    New York, NY 10005

 

Ladies and Gentlemen:

 

Exide Technologies, a Delaware corporation (the “Company”), hereby confirms its
agreement with you (the “Initial Purchasers”), as set forth below.

 

  1. THE SECURITIES.

 

Subject to the terms and conditions contained herein the Company proposes to
issue and sell to the Initial Purchasers $60,000,000 aggregate principal amount
of its Floating Rate Convertible Senior Subordinated Notes due 2013 (the “Firm
Securities”). The Company also proposes to issue and sell to the Initial
Purchasers at Deutsche Bank Securities Inc.’s option an additional $9,000,000
aggregate principal amount of its Floating Rate Convertible Senior Subordinated
Notes due 2013 (the “Option Securities” and together with the Firm Securities,
the “Securities”) as set forth below.

 

The Securities are convertible into shares of common stock, par value $0.01 per
share, of the Company (the “Common Stock”). The shares of Common Stock into
which the Securities may be convertible are referred to herein as the
“Underlying Securities.” The Securities are to be issued pursuant to the terms
of an Indenture dated as of March 18, 2005, between the Company and SunTrust
Bank, as Trustee (the “Trustee”).

 

The sale of the Securities and the Underlying Securities will be made without
registration under the Securities Act of 1933, as amended (the “Securities
Act”), in reliance on exemptions from the registration requirements of the
Securities Act. As the Initial Purchasers, you have advised the Company that you
will offer and sell the Securities purchased by you hereunder (the “Offering”)
in accordance with Section 4 hereof as soon as you deem advisable.

 

In connection with the Offering, the Company has prepared a final offering
memorandum, dated March 15, 2005 (the “Final Memorandum”). The Final Memorandum
sets forth certain information regarding the Company, the Securities and the
Underlying Securities.

 

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The Company hereby confirms that it has authorized the use of the Final
Memorandum, and any amendment or supplement thereto, in connection with the
Offering by the Initial Purchasers. Unless stated to the contrary, all
references herein to the Final Memorandum are to the Final Memorandum at the
date thereof and are not meant to include any amendment or supplement, or any
information incorporated by reference therein subsequent to the date thereof and
any references herein to the terms “amend,” “amendment” or “supplement” with
respect to the Final Memorandum shall be deemed to refer to and include any
information filed under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), subsequent to the date of the Final Memorandum which is
incorporated by reference therein. The term “Memorandum” refers to the Final
Memorandum.

 

Concurrently with the Offering, the Company is also separately offering
$290,000,000 in aggregate principal amount of 10-1/2% Senior Secured Notes due
2013 (the “Senior Notes”). The proceeds of the Senior Notes offering along with
the proceeds from the sale of the Securities will be used as described in the
Final Memorandum under the heading “Use of Proceeds.”

 

In connection with the Offering, the Company also proposes to enter into a
Registration Rights Agreement, to be dated as of the Closing Date (as defined in
Section 3(a) below), between the Company and the Initial Purchasers (the
“Registration Rights Agreement”).

 

In consideration of the mutual agreements contained herein and of the interests
of the parties in the transactions contemplated hereby, the parties hereto agree
as follows:

 

  2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

 

The Company represents and warrants to the Initial Purchasers as follows:

 

(a) Neither the Final Memorandum nor any amendment or supplement thereto as of
the date thereof and at all times subsequent thereto up to the Closing Date (as
defined in Section 3 below) contained or contains any untrue statement of a
material fact or omitted or omits to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, except that the representations and warranties set forth
in this Section 2(a) do not apply to statements or omissions made in reliance
upon and in conformity with information relating to the Initial Purchasers
furnished to the Company in writing by or on behalf of the Initial Purchasers
expressly for use in the Final Memorandum or any amendment or supplement
thereto.

 

(b) As of the Closing Date, the Company’s amended and restated certificate of
incorporation authorized the issuance of 62,500,000 shares of capital stock,
including 61,500,000 shares of common stock, par value $0.01 per share, and
1,000,000 shares of preferred stock, par value $0.01 per share; the number of
outstanding shares of the Company’s common stock is set forth in the Final
Memorandum in the section “Principal Stockholders” as of the date indicated; the
information set forth under the caption “Capitalization” in the Final Memorandum
is true and correct in all material respects; all of the subsidiaries of the
Company are listed in Schedule II attached hereto (each, a

 

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“Subsidiary” and collectively, the “Subsidiaries”); except as set forth in the
Final Memorandum, all of the outstanding shares of capital stock or membership
interest, as applicable, of the Company and the Subsidiaries have been, and as
of the Closing Date will be, duly authorized and validly issued, are fully paid
and nonassessable and were not issued in violation of any preemptive or similar
rights; except as set forth in the Final Memorandum, all of the outstanding
shares of capital stock or membership interest, as applicable, of the Company
and of each of the Subsidiaries will be free and clear of all liens,
encumbrances, equities and claims or restrictions on transferability (other than
those imposed by (1) the Credit Agreement dated May 5, 2004, among the Company,
Deutsche Bank AG New York Branch, as administrative agent, and the other parties
thereto, as amended (the “Credit Agreement”), (2) liens, encumbrances and claims
under the Indenture governing the Senior Notes, (3) the Securities Act and (4)
the securities or “Blue Sky” laws of certain jurisdictions) or voting; except as
set forth in the Final Memorandum and except for pursuant to the Company’s
equity incentive plan or in connection with the Joint Plan of Reorganization
confirmed as of May 5, 2004, there are no (i) options, warrants or other rights
to purchase, (ii) agreements or other obligations to issue or (iii) other rights
to convert any obligation into, or exchange any securities for, shares of
capital stock of or ownership interests in the Company or any of the
Subsidiaries outstanding. Except for the Subsidiaries or as disclosed in the
Final Memorandum or Schedule II hereto, the Company does not own, directly or
indirectly, any shares of capital stock or any other equity or long-term debt
securities or have any equity interest in any firm, partnership, joint venture
or other entity.

 

(c) Each of the Company and the Subsidiaries is duly incorporated or otherwise
organized, validly existing and in good standing under the laws of its
respective jurisdiction of incorporation or organization and has all requisite
corporate or organizational power and authority to own or lease its properties
and conduct its business as now conducted and as described in the Final
Memorandum; each of the Company and the Subsidiaries is duly qualified to do
business as a foreign corporation or entity in good standing in all other
jurisdictions where the ownership or leasing of its properties or the conduct of
its business requires such qualification, except where the failure to be so
qualified would not, individually or in the aggregate, reasonably be expected to
have a material adverse effect on the general affairs, management, business,
financial condition or results of operations of the Company and the
Subsidiaries, taken as a whole (any such event, a “Material Adverse Effect”).

 

(d) The Company has all requisite corporate power and authority to execute,
deliver and perform each of its obligations under the Securities. The
Securities, when issued, will be in the form contemplated by the Indenture. The
Securities have each been duly and validly authorized by the Company and, when
executed by the Company and authenticated by the Trustee in accordance with the
provisions of the Indenture and, when delivered to and paid for by the Initial
Purchasers in accordance with the terms of this Agreement, will constitute valid
and legally binding obligations of the Company, entitled to the benefits of the
Indenture, and enforceable against the Company in accordance with their terms,
except that the enforcement thereof may be subject to (i) bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium or other similar
laws now or hereafter in effect relating to creditors’ rights generally, and
(ii) general principles of

 

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equity and the discretion of the court before which any proceeding therefor may
be brought.

 

(e) The shares of Common Stock to be issued upon conversion of the Securities
have been duly authorized and reserved and, when issued upon conversion of the
Securities, will be validly issued, fully paid and nonassessable; and no
preemptive rights of stockholders exist with respect to any of the Common Stock
to be issued upon conversion of the Securities.

 

(f) All of the shares of Common Stock conform in all material respects to the
description thereof contained in the Final Memorandum; the form of certificate
for the shares of Common Stock conforms in all material respects to the
requirements of the General Corporation Law of the State of Delaware.

 

(g) The Company has all requisite corporate power and authority to execute,
deliver and perform its obligations under the Indenture. The Indenture meets in
all material respects the requirements for qualification under the Trust
Indenture Act of 1939, as amended (the “TIA”). The Indenture has been duly and
validly authorized by the Company and, when executed and delivered by the
Company (assuming the due authorization, execution and delivery by the Trustee),
will constitute a valid and legally binding agreement of the Company,
enforceable against the Company in accordance with its terms, except that the
enforcement thereof may be subject to (i) bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium or other similar laws now or
hereafter in effect relating to creditors’ rights generally and (ii) general
principles of equity and the discretion of the court before which any proceeding
therefor may be brought.

 

(h) The Company has all requisite corporate power and authority to execute,
deliver and perform its obligations under the Registration Rights Agreement. The
Registration Rights Agreement has been duly and validly authorized by the
Company and, when executed and delivered by the Company (assuming the due
authorization, execution and delivery by the Initial Purchasers), will
constitute a valid and legally binding agreement of the Company enforceable
against the Company in accordance with its terms, except that (A) the
enforcement thereof may be subject to (i) bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium or other similar laws now or
hereafter in effect relating to creditors’ rights generally, and (ii) general
principles of equity and the discretion of the court before which any proceeding
therefor may be brought and (B) any rights to indemnity or contribution
thereunder may be limited by federal and state securities laws and public policy
considerations.

 

(i) All of the Underlying Securities issuable upon conversion of the Securities
have been duly authorized. The Company has submitted a notification for listing
the Underlying Securities with NASDAQ.

 

(j) The Company has all requisite corporate power and authority to execute,
deliver and perform its obligations under this Agreement and to consummate the
transactions contemplated hereby. This Agreement and the consummation by the

 

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Company of the transactions contemplated hereby have been duly and validly
authorized by the Company. This Agreement has been duly executed and delivered
by the Company.

 

(k) No consent, approval, authorization or order of any court or governmental
agency or body, or third party is required for the issuance and sale by the
Company of the Securities to the Initial Purchasers or the consummation by the
Company of the other transactions contemplated hereby, except such as have been
obtained, such as may be required under state securities or “Blue Sky” laws in
connection with the purchase and resale of the Securities by the Initial
Purchasers and the consent to listing of the Underlying Securities on NASDAQ.
None of the Company or the Subsidiaries is (i) in violation of its certificate
of incorporation, bylaws or limited liability company agreement (or similar
organizational document), (ii) in breach or violation of any statute, judgment,
decree, order, rule or regulation applicable to any of them or any of their
respective properties or assets, except for any such breach or violation that
would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect, or (iii) in breach of or default under (nor has any
event occurred that, with notice or passage of time or both, would constitute a
default under) or in violation of any of the terms or provisions of any
indenture, mortgage, deed of trust, loan agreement (including, without
limitation, the Credit Agreement), note, lease, license, franchise agreement,
permit, certificate, contract or other agreement or instrument to which any of
them is a party or to which any of them or their respective properties or assets
is subject (collectively, “Contracts”), except for any such breach, default,
violation or event that would not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect.

 

(l) The execution, delivery and performance by the Company of this Agreement,
the Indenture and the Registration Rights Agreement and the consummation by the
Company of the transactions contemplated hereby and thereby (including, without
limitation, the issuance and sale of the Securities to the Initial Purchasers)
will not conflict with or constitute or result in a breach of or a default under
(or an event that with notice or passage of time or both would constitute a
default under) or violation of any of (i) the terms or provisions of any
Contract, except for any such conflict, breach, violation, default or event that
would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect, (ii) the certificate of incorporation, bylaws or
limited liability company agreement (or similar organizational document) of the
Company or any of the Subsidiaries or (iii) (assuming compliance with all
applicable state securities or “Blue Sky” laws and assuming the accuracy of the
representations and warranties of the Initial Purchasers in Section 8 hereof)
any statute, judgment, decree, order, rule or regulation applicable to the
Company or any of the Subsidiaries or any of their respective properties or
assets, except for any such conflict, breach or violation that would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.

 

(m) The audited consolidated financial statements of the Company and the
Subsidiaries included in the Final Memorandum present fairly in all material
respects the financial position, results of operations and cash flows of the
Company and the

 

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Subsidiaries at the dates and for the periods to which they relate and have been
prepared in accordance with generally accepted accounting principles applied on
a consistent basis, except as otherwise stated therein. The summary and selected
financial and statistical data in the Final Memorandum present fairly in all
material respects the information shown therein and have been prepared and
compiled on a basis consistent with the audited financial statements included
therein, except as otherwise stated therein. PricewaterhouseCoopers LLP (the
“Independent Accountants”) is an independent public accounting firm within the
meaning of the Securities Act and the rules and regulations promulgated
thereunder.

 

(n) The pro forma financial information included in the Final Memorandum (i)
complies as to form in all material respects with the applicable requirements of
Regulation S-X promulgated under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), (ii) has been prepared in accordance with the Commission’s
rules and guidelines with respect to pro forma financial information and (iii)
has been properly computed on the bases described therein; the assumptions used
in the preparation of the pro forma financial information included in the Final
Memorandum are reasonable and the adjustments used therein are appropriate to
give effect to the transactions or circumstances referred to therein.

 

(o) Except as set forth in the Final Memorandum, there is not pending or, to the
knowledge of the Company, threatened any action, suit, proceeding, inquiry or
investigation to which the Company or any of the Subsidiaries is a party, or to
which the property or assets of the Company or any of the Subsidiaries are
subject, before or brought by any court, arbitrator or governmental agency or
body that, if determined adversely to the Company or any of the Subsidiaries,
would, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect or that seeks to restrain, enjoin, prevent the
consummation of or otherwise challenge the issuance or sale of the Securities to
be sold hereunder, the issuance of the Underlying Securities issuable upon a
conversion of the Securities or the consummation of the other transactions
described in the Final Memorandum.

 

(p) Each of the Company and the Subsidiaries possesses all licenses, permits,
certificates, consents, orders, approvals and other authorizations from, and has
made all necessary declarations and filings with, all federal, state, foreign,
local and other governmental authorities, all self-regulatory organizations and
all courts and other tribunals, presently required or necessary to own or lease,
as the case may be, and to operate its respective properties and to carry on its
respective businesses as now or proposed to be conducted as set forth in the
Final Memorandum (“Permits”), except where the failure to obtain such Permits
would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect; each of the Company and the Subsidiaries has fulfilled
and performed all of its obligations with respect to such Permits and no event
has occurred that allows, or after notice or lapse of time would allow,
revocation or termination thereof or results in any other material impairment of
the rights of the holder of any such Permit; and none of the Company or the
Subsidiaries has received any written notice of any proceeding relating to
revocation or modification of any such Permit, except as described in the Final
Memorandum and except where such

 

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revocation or modification would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.

 

(q) Since the date of the most recent financial statements appearing in the
Final Memorandum, except as described therein, (i) none of the Company or the
Subsidiaries has incurred any liabilities or obligations, direct or contingent,
or entered into or agreed to enter into any transactions or contracts (written
or oral) not in the ordinary course of business, which liabilities, obligations,
transactions or contracts would, individually or in the aggregate, be material
to the general affairs, management, business, condition (financial or
otherwise), prospects or results of operations of the Companies and its
Subsidiaries, taken as a whole, (ii) none of the Company or the Subsidiaries has
purchased any of its outstanding capital stock or membership interest, nor
declared, paid or otherwise made any dividend or distribution of any kind on its
capital stock or membership interest (other than with respect to any of such
Subsidiaries, the purchase of, or dividend or distribution on, capital stock
owned by the Company) and (iii) there shall not have been any material change in
the capital stock, membership interest or long-term indebtedness of the Company
or the Subsidiaries.

 

(r) Each of the Company and the Subsidiaries has filed all necessary federal,
state and foreign income and franchise tax returns that are required to be
filed, except where the failure to so file such returns would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect,
and has paid all taxes shown as due thereon to the extent such taxes become due
and payable; and other than tax deficiencies that the Company or any Subsidiary
is contesting in good faith and for which the Company or such Subsidiary has
provided adequate reserves, there is no tax deficiency that has been asserted
against the Company or any of the Subsidiaries that would reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect.

 

(s) The statistical and market-related data included in the Final Memorandum are
based on or derived from sources that the Company believes to be reliable and
accurate.

 

(t) None of the Company, the Subsidiaries or any agent acting on their behalf
has taken or will take any action that might cause this Agreement, the sale of
the Securities or the issuance of the Underlying Securities to violate
Regulation T, U or X of the Board of Governors of the Federal Reserve System, in
each case as in effect, or as the same may hereafter be in effect, on the
Closing Date.

 

(u) Each of the Company and the Subsidiaries has good and marketable title to
all real property and good title to all personal property described in the Final
Memorandum as being owned by it and good and marketable title to a leasehold
estate in the real and personal property described in the Final Memorandum as
being leased by it free and clear of all liens, charges, encumbrances or
restrictions, except as described in the Final Memorandum or to the extent the
failure to have such title or the existence of such liens, charges, encumbrances
or restrictions would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. All leases,

 

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contracts and agreements to which the Company or any of the Subsidiaries is a
party or by which any of them is bound are valid and enforceable against the
Company or such Subsidiary, and are valid and enforceable against the other
party or parties thereto and are in full force and effect with only such
exceptions as would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. The Company and the Subsidiaries own
or possess adequate licenses or other rights to use all patents, trademarks,
service marks, trade names, copyrights and know-how necessary to conduct the
businesses now or proposed to be operated by them as described in the Final
Memorandum except those that, individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect, and none of the
Company or the Subsidiaries has received any written notice of infringement of
or conflict with (or knows of any such infringement of or conflict with)
asserted rights of others with respect to any patents, trademarks, service
marks, trade names, copyrights or know-how that, if such assertion of
infringement or conflict were sustained, would reasonably be expected to have a
Material Adverse Effect.

 

(v) There are no legal or governmental proceedings involving or affecting the
Company or any Subsidiary or any of their respective properties or assets that
would be required to be described in a prospectus pursuant to the Securities Act
that are not described in the Final Memorandum, nor are there any material
contracts or other documents that would be required to be described in a
prospectus pursuant to the Securities Act that are not described in the Final
Memorandum.

 

(w) Except as would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect and except as described in or
contemplated by the Final Memorandum, (A) each of the Company and the
Subsidiaries is in compliance with and not subject to liability under applicable
Environmental Law (as defined below), (B) each of the Company and the
Subsidiaries has made all filings and provided all notices required under any
applicable Environmental Law, and has and is in compliance with all Permits
required under any applicable Environmental Laws and each of them is in full
force and effect, (C) there is no civil, criminal or administrative action,
suit, demand, claim, hearing, notice of violation, investigation, proceeding,
notice or demand letter or request for information pending or, to the knowledge
of the Company or any of the Subsidiaries, threatened against the Company or any
of the Subsidiaries under any Environmental Law, (D) no lien, charge,
encumbrance or restriction has been recorded under any Environmental Law with
respect to any assets, facility or property owned, operated, leased or
controlled by the Company or any of the Subsidiaries, (E) none of the Company or
the Subsidiaries has received written notice that it has been identified as a
potentially responsible party under the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended (“CERCLA”), or any comparable
state law, (F) no property or facility of the Company or any of the Subsidiaries
is (i) listed or proposed for listing on the National Priorities List under
CERCLA or is (ii) listed in the Comprehensive Environmental Response,
Compensation and Liability Information System List promulgated pursuant to
CERCLA, or on any comparable list maintained by any state or local governmental
authority, (G) neither the Company nor any of its Subsidiaries is conducting or
financing an investigation, or response, corrective or other action pursuant to
Environmental Law at any site of facility,

 

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nor is any of them subject to or party to any order, judgment, decree, contract
or agreement which obligates it to conduct or finance any such action nor has
any of them assumed by contract or agreement any obligation or liability under
Environmental Law, and (H) there are no past or present events, activities,
operations, occurrences or conditions which could reasonably be expected to
prevent or interfere with compliance by the Company of any of its Subsidiaries
with, or result in liability of any of them under, Environmental Law (including,
without limitation, any capital or operating expenditures required for cleanup,
closure or compliance with the Environmental Law, any constraints on operating
activities and any potential liability to third parties).

 

For purposes of this Agreement, “Environmental Law” means the common law and all
applicable foreign, federal, provincial, state and local laws or regulations,
codes, ordinances, orders, decrees, judgments or injunctions issued,
promulgated, approved or entered thereunder, relating to pollution or protection
of public or employee health and safety, the environment or natural resource
damages including, without limitation, those relating to (i) emissions,
discharges, releases or threatened releases of Hazardous Material in or into the
environment (including, without limitation, ambient air, surface water,
groundwater, drinking water, land surface or subsurface strata, and natural
resources such as wetlands, flora and fauna) or exposure thereto, (ii) the
manufacture, processing, distribution, use, generation, treatment, storage,
disposal, transport, handling or recycling of Hazardous Material, (iii) zoning,
facility siting, financial assurance, environmental impact assessment or review,
reclamation or land use and (iv) underground or aboveground storage tanks and
related piping, and emissions, discharges, releases or threatened releases
therefrom. “Hazardous Material” means any substance, material, pollutant,
contaminant, chemical, constituent or waste, including without limitation,
petroleum and petroleum products, subject to regulation under or which could
give rise to liability under Environmental Law.

 

(x) Except as set forth in the Final Memorandum, there is no strike, labor
dispute, slowdown or work stoppage with the employees of the Company or any of
the Subsidiaries that is pending or, to the knowledge of the Company or any of
the Subsidiaries, threatened.

 

(y) Each of the Company and the Subsidiaries carries insurance in such amounts
and covering such risks as is reasonable for the conduct of its business and the
value of its properties.

 

(z) None of the Company or the Subsidiaries has any material liability for any
prohibited transaction or funding deficiency or any complete or partial
withdrawal liability with respect to any pension, profit sharing or other plan
that is subject to the Employee Retirement Income Security Act of 1974, as
amended (“ERISA”), to which the Company or any of the Subsidiaries makes or ever
has made a contribution and in which any employee of the Company or of any
Subsidiary is or has ever been a participant, except as described in the Final
Memorandum and except where such liability would not reasonably be expected to,
individually or in the aggregate, have a Material Adverse Effect. With respect
to such plans, the Company and each Subsidiary is in compliance in all material
respects with all applicable provisions of ERISA.

 

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(aa) Each of the Company and the Subsidiaries (i) makes and keeps accurate books
and records and (ii) maintains internal accounting controls that provide
reasonable assurance that (A) transactions are executed in accordance with
management’s authorization, (B) transactions are recorded as necessary to permit
preparation of its financial statements and to maintain accountability for its
assets, (C) access to its assets is permitted only in accordance with
management’s authorization and (D) the reported accountability for its assets is
compared with existing assets at reasonable intervals.

 

(bb) None of the Company or the Subsidiaries will be an “investment company” or
“promoter” or “principal underwriter” for an “investment company,” as such terms
are defined in the Investment Company Act of 1940, as amended, and the rules and
regulations thereunder.

 

(cc) The Securities, the Underlying Securities, the Indenture and the
Registration Rights Agreement will conform in all material respects to the
descriptions thereof in the Final Memorandum.

 

(dd) No holder of securities of the Company or any Subsidiary will be entitled
to have such securities registered under the registration statements required to
be filed by the Company pursuant to the Registration Rights Agreement other than
as expressly permitted thereby.

 

(ee) Immediately after the consummation of the transactions contemplated by this
Agreement, the fair value and present fair saleable value of the assets of the
Company and the Subsidiaries on a consolidated basis will exceed the sum of
their stated liabilities and identified contingent liabilities on a consolidated
basis; the Company and the Subsidiaries on a consolidated basis will not be,
after giving effect to the execution, delivery and performance of this
Agreement, and the consummation of the transactions contemplated hereby, (i)
left with unreasonably small capital with which to carry on their business as it
is proposed to be conducted, (ii) unable to pay their debts (contingent or
otherwise) as they mature or (iii) otherwise insolvent.

 

(ff) None of the Company, the Subsidiaries or any of their respective Affiliates
(as defined in Rule 501(b) of Regulation D under the Securities Act) has
directly, or through any agent, (i) sold, offered for sale, solicited offers to
buy or otherwise negotiated in respect of any “security” (as defined in the
Securities Act) that is or could be integrated with the sale of the Securities
in a manner that would require the registration under the Securities Act of the
Securities or (ii) engaged in any form of general solicitation or general
advertising (as those terms are used in Regulation D under the Securities Act)
in connection with the offering of the Securities or in any manner involving a
public offering within the meaning of Section 4(2) of the Securities Act.
Assuming the accuracy of the representations and warranties of the Initial
Purchasers in Section 8 hereof, it is not necessary in connection with the
offer, sale and delivery of the Securities to the Initial Purchasers in the
manner contemplated by this Agreement to register any of the Notes under the
Securities Act or to qualify the Indenture under the TIA.

 

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(gg) No securities of the Company or any Subsidiary are of the same class
(within the meaning of Rule 144A under the Securities Act) as the Securities and
listed on a national securities exchange registered under Section 6 of the
Exchange Act, or quoted in a U.S. automated inter-dealer quotation system.

 

(hh) None of the Company or the Subsidiaries has taken, nor will any of them
take, directly or indirectly, any action designed to, or that might be
reasonably expected to, cause or result in stabilization or manipulation of the
price of the Securities.

 

(ii) None of the Company, the Subsidiaries, any of their respective Affiliates
or any person acting on its or their behalf (other than the Initial Purchasers)
has engaged in any directed selling efforts (as that term is defined in
Regulation S under the Securities Act (“Regulation S”)) with respect to the
Notes; the Company, the Subsidiaries and their respective Affiliates and any
person acting on its or their behalf (other than the Initial Purchasers) have
complied with the offering restrictions requirement of Regulation S.

 

(jj) Neither the Company nor its Subsidiaries nor, to the knowledge of the
Company, any director, officer, agent, employee or Affiliate of the Company or
any of its Subsidiaries is aware of or has taken any action, directly or
indirectly, that would result in a material violation by such persons of the
Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations
thereunder (the “FCPA”), including, without limitation, making use of the mails
or any means or instrumentality of interstate commerce corruptly in furtherance
of an offer, payment, promise to pay or authorization of the payment of any
money, or other property, gift, promise to give, or authorization of the giving
of anything of value to any “foreign official” (as such term is defined in the
FCPA) or any foreign political party or official thereof or any candidate for
foreign political office, in contravention of the FCPA; and the Company, its
Subsidiaries and, to the knowledge of the Company, its Affiliates have conducted
their businesses in compliance with the FCPA and have instituted and maintain
policies and procedures designed to ensure, and which are reasonably expected to
continue to ensure, continued compliance therewith.

 

(kk) The operations of the Company and its Subsidiaries are and have been
conducted at all times in compliance with applicable financial recordkeeping and
reporting requirements of the Currency and Foreign Transactions Reporting Act of
1970, as amended, the money laundering statutes of all jurisdictions, the rules
and regulations thereunder and any related or similar rules, regulations or
guidelines, issued, administered or enforced by any governmental agency
(collectively, the “Money Laundering Laws”) and no action, suit or proceeding by
or before any court or governmental agency, authority or body or any arbitrator
involving the Company or any of its Subsidiaries with respect to the Money
Laundering Laws is pending or, to the best knowledge of the Company, threatened.

 

(ll) To the best of the Company’s knowledge, there is and has been no failure on
the part of the Company and any of the Company’s directors or officers, in their
capacities as such, to comply with any applicable and effective provision of the
Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in
connection therewith

 

11

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(the “Sarbanes-Oxley Act”), including Section 402 related to loans and Sections
302 and 906 related to certifications, except where any such failure to comply
would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.

 

(mm) Neither the Company, any of its Subsidiaries nor, to the knowledge of the
Company, any director, officer, agent, employee or Affiliate of the Company or
any of its Subsidiaries is currently subject to any U.S. sanctions administered
by the Office of Foreign Assets Control of the U.S. Department of the Treasury
(“OFAC”); and the Company will not directly or indirectly use the proceeds of
the offering of the Securities hereunder, or lend, contribute or otherwise make
available such proceeds to any subsidiary, joint venture partner or other person
or entity, for the purpose of financing the activities of any person currently
subject to any U.S. sanctions administered by OFAC.

 

Any certificate signed by any officer of the Company or any Subsidiary and
delivered to any Initial Purchasers or to counsel for the Initial Purchasers
shall be deemed a joint and several representation and warranty by the Company
and each of the Subsidiaries to the Initial Purchasers as to the matters covered
thereby.

 

  3. PURCHASE, SALE AND DELIVERY OF THE SECURITIES.

 

(a) On the basis of the representations, warranties and covenants herein
contained, and subject to the conditions herein set forth, the Company agrees to
issue and sell to the Initial Purchasers and the Initial Purchasers, acting
severally and not jointly, agree to purchase from the Company, at a purchase
price of 97% of the aggregate principal amount thereof (the “Purchase Price”),
plus accrued interest, if any, from March 18, 2005 to the Closing Date, all the
principal amount of Firm Securities set forth opposite the name of such Initial
Purchasers in Schedule I hereto. Each Security will be convertible at the option
of the holder into the Underlying Securities at the conversion price set forth
in the Securities (the “Conversion Price”), which Conversion Price is subject to
adjustment in certain events as provided in the Securities and the Indenture.
One or more global securities representing the Firm Securities shall be
registered by the Trustee in the name of the nominee of The Depository Trust
Company (“DTC”), Cede & Co., credited to the accounts of such of its
participants as the Initial Purchasers shall request, upon notice to the Company
at least 48 hours prior to the Closing Date, with any transfer taxes payable in
connection with the transfer of the Securities to the Initial Purchasers duly
paid, and deposited with the Trustee as custodian for DTC on the Closing Date,
against payment by or on behalf of the Initial Purchasers to the account of the
Company of the aggregate Purchase Price therefor by wire transfer in immediately
available funds. Delivery of and payment for the Firm Securities shall be made
at the offices of Cahill Gordon & Reindel LLP, 80 Pine Street, New York, New
York 10005, at 10:00 A.M., New York City time, on the third full business day
following the date of this Agreement, or at such other place, time or date not
later than five business days thereafter as the Initial Purchasers and the
Company may agree upon. Such time and date of delivery against payment are
herein referred to as the “Closing Date.” (As used herein, “business day” means
a day on which the New York Stock Exchange is open for trading and on which
banks in New York are open for business and are not permitted by law or
executive order to be closed.)

 

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(b) In addition, on the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, the Company
hereby grants an option to Deutsche Bank Securities Inc. to purchase the Option
Securities at the Purchase Price set forth in the first paragraph of this
Section 3 plus accrued interest, if any, from March 18, 2005 to the Option
Closing Date (as defined below). The option granted hereby may be exercised by
Deutsche Bank Securities Inc. in whole or in part by giving written notice (i)
at any time before the Closing Date and (ii) only once thereafter within 45 days
after the date of this Agreement, to the Company setting forth the aggregate
principal amount of Option Securities as to which Deutsche Bank Securities Inc.
is exercising the option and the time and date for delivery of and payment for
such Option Securities. The time and date for delivery of and payment for such
Option Securities shall be determined by the Deutsche Bank Securities Inc. but
shall not be earlier than three nor later than ten full business days after the
exercise of such option, nor in any event prior to the Closing Date (such time
and date being herein referred to as the “Option Closing Date”). If the date of
exercise of the option is two or more days before the Closing Date, the notice
of exercise shall set the Closing Date as the Option Closing Date. Deutsche Bank
Securities Inc. may cancel such option at any time prior to its expiration by
giving written notice of such cancellation to the Company.

 

  4. OFFERING BY THE INITIAL PURCHASERS.

 

The Initial Purchasers propose to make an offering of the Notes at the price and
upon the terms set forth in the Final Memorandum as soon as practicable after
this Agreement is entered into and as in the judgment of the Initial Purchasers
is advisable.

 

  5. COVENANTS OF THE COMPANY.

 

The Company covenants and agrees with the Initial Purchasers that:

 

(a) Prior to the sale of all of the Notes by the Initial Purchasers, the Company
will not amend or supplement the Final Memorandum or any amendment or supplement
thereto of which the Initial Purchaser shall not previously have been advised
and furnished a copy for a reasonable period of time prior to the proposed
amendment or supplement and as to which the Initial Purchasers shall not have
given its consent, which consent shall not be unreasonably withheld. The Company
will promptly, upon the reasonable request of the Initial Purchasers or counsel
for the Initial Purchasers, make any amendments or supplements to the Final
Memorandum that may be necessary or advisable in connection with the resale of
the Securities by the Initial Purchasers.

 

(b) The Company will cooperate with the Initial Purchasers in arranging for the
qualification of the Securities for offering and sale under the securities or
“Blue Sky” laws of which jurisdictions as the Initial Purchasers may designate
and will continue such qualifications in effect for as long as may be necessary
to complete the resale of the Securities; provided, however, that in connection
therewith, the Company shall not be required to qualify as a foreign corporation
or to execute a general consent to service of process in any jurisdiction or
subject itself to taxation in excess of a nominal dollar amount in any such
jurisdiction where it is not then so subject.

 

13

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(c) If, at any time prior to the completion of the distribution by the Initial
Purchasers of the Securities, any event occurs or information becomes known as a
result of which the Final Memorandum as then amended or supplemented would
include any untrue statement of a material fact, or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, or if for any other reason it is
necessary at any time to amend or supplement the Final Memorandum to comply with
applicable law, the Company will promptly notify the Initial Purchasers thereof
and will prepare, at the expense of the Company, an amendment or supplement to
the Final Memorandum that corrects such statement or omission or effects such
compliance

 

(d) The Company will, without charge, provide to the Initial Purchasers and to
counsel for the Initial Purchasers as many copies of the Final Memorandum or any
amendment or supplement thereto as the Initial Purchasers may reasonably
request.

 

(e) The Company intends to apply the net proceeds from the sale of the
Securities as set forth under “Use of Proceeds” in the Final Memorandum.

 

(f) For so long as any of the Securities remain outstanding, the Company will
furnish to the Initial Purchasers copies of all reports and other communications
(financial or otherwise) furnished by the Company to the Trustee or to the
holders of the Securities and, as soon as available, copies of any reports or
financial statements furnished to or filed by the Company with the Commission or
any national securities exchange on which the Securities may be listed, unless
otherwise publicly available through the EDGAR system of the Commission.

 

(g) Prior to the Closing Date, the Company will furnish to the Initial
Purchasers, as soon as they have been prepared, a copy of any unaudited interim
financial statements of the Company for any period subsequent to the period
covered by the most recent financial statements appearing in the Final
Memorandum.

 

(h) None of the Company or any of its Affiliates will sell, offer for sale or
solicit offers to buy or otherwise negotiate in respect of any “security” (as
defined in the Securities Act) that could be integrated with the sale of the
Securities in a manner which would require the registration under the Securities
Act of the Securities.

 

(i) No offering, sale, short sale or other disposition of any shares of Common
Stock or other securities convertible into or exchangeable or exercisable for
shares of Common Stock or derivative of Common Stock (or agreement for such)
will be made for a period of 90 days after the date of this Agreement, directly
or indirectly, by the Company otherwise than hereunder, upon the terms set forth
in the Final Memorandum, upon exercise or conversion of options or warrants
outstanding on the Closing Date, options issued (and the exercise of such
options) pursuant to the Company’s equity incentive plan, to holders of
pre-petition claims pursuant to the Joint Plan of Reorganization confirmed as of
May 5, 2004 or with the prior written consent of the Initial Purchasers. The
Company will not file a registration statement under the Securities Act in
connection with any transaction by the Company or any person that is

 

14

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prohibited pursuant to the foregoing, except for (i) the Company’s filing of
registration statements pursuant to the Registration Rights Agreement, (ii)
registration statements on Form S-8 relating to employee benefit plans or on
Form S-4 relating to corporate reorganizations or other transactions under Rule
145 and (iii) registration statements on Form S-3 or S-4 relating to the
Exchange Offer with respect to the Note or Senior Notes.

 

(j) The Company shall have caused each officer and director of the Company under
the caption “Management” in the Final Memorandum and the person specified on
Schedule III hereto to furnish to you, on or prior to the Closing Date, a
“lock-up” letter or letters, in substantially the form of Exhibit A hereto
(“Lock-up Agreements”).

 

(k) The Company will not, and will not permit any of the Subsidiaries to, engage
in any form of general solicitation or general advertising (as those terms are
used in Regulation D under the Securities Act) in connection with the offering
of the Notes or in any manner involving a public offering within the meaning of
Section 4(2) of the Securities Act.

 

(l) Except as contemplated by the Registration Rights Agreement, neither the
Company, nor any of its Affiliates, nor any person acting on its behalf will,
directly or indirectly, make offers or sales of any security, or solicit offers
to buy any security, under circumstances that would require the registration of
the Securities or the Underlying Securities issuable upon conversion thereof
under the Securities Act.

 

(m) For so long as any of the Notes remain outstanding, the Company will make
available at its expense, upon request, to any holder of such Securities and any
prospective purchasers thereof the information specified in Rule 144A(d)(4)
under the Securities Act, unless the Company is then subject to Section 13 or
15(d) of the Exchange Act.

 

(n) The Company will use its reasonable best efforts to (i) permit the
Securities to be designated as PORTAL-eligible securities in accordance with the
rules and regulations adopted by the NASD relating to trading in the NASD’s
Portal Market (the “Portal Market”) and (ii) permit the Securities to be
eligible for clearance and settlement through The Depository Trust Company.

 

(o) In connection with Securities offered and sold in an off shore transaction
(as defined in Regulation S) the Company will not register any transfer of such
Securities not made in accordance with the provisions of Regulation S and will
not, except in accordance with the provisions of Regulation S, if applicable,
issue any such Securities in the form of definitive securities.

 

(p) For a period of two years (calculated in accordance with paragraphs (d) of
Rule 144 under the Act) following the date any Securities are acquired from the
Company or any of its Affiliates, none of the Company or any of its Affiliates
will sell any such Securities if such Securities would constitute restricted
securities under Rule 144 following resale of any of them.

 

15

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  6. COSTS AND EXPENSES.

 

The Company agrees to pay all costs and expenses incident to the performance of
its obligations under this Agreement, whether or not the transactions
contemplated herein are consummated or this Agreement is terminated pursuant to
Section 11 hereof, including all costs and expenses incident to (i) the
printing, word processing or other production of documents with respect to the
transactions contemplated hereby, including any costs of printing the Final
Memorandum and any amendment or supplement thereto, and any “Blue Sky”
memoranda, (ii) all arrangements relating to the delivery to the Initial
Purchasers of copies of the foregoing documents, (iii) the fees and
disbursements of the counsel, the accountants and any other experts or advisors
retained by the Company, (iv) preparation (including printing), issuance and
delivery to the Initial Purchasers of any certificates evidencing the
Securities, (v) the qualification of the Securities under state securities and
“Blue Sky” laws, including filing fees and reasonable fees and disbursements of
counsel for the Initial Purchasers relating thereto not to exceed $5,000 in the
aggregate, (vi) expenses in connection with the “roadshow” and any other
meetings with prospective investors in the Securities, except all aircraft
related costs and expenses will be divided evenly between the Company and the
Initial Purchasers, (vii) fees and expenses of the Trustee including fees and
expenses of counsel for the Trustee, (viii) all expenses and listing fees
incurred in connection with the application for quotation of the Securities on
The Portal Market and (ix) any fees charged by investment rating agencies for
the rating of the Securities. If the sale of the Securities provided for herein
is not consummated because any condition to the obligations of the Initial
Purchasers set forth in Section 7 hereof is not satisfied, because this
Agreement is terminated or because of any failure, refusal or inability on the
part of the Company to perform all obligations and satisfy all conditions on
their part to be performed or satisfied hereunder (other than solely by reason
of a default by the Initial Purchasers of its obligations hereunder after all
conditions hereunder have been satisfied in accordance herewith), the Company
agrees to promptly reimburse the Initial Purchasers upon demand for all
reasonable and documented out-of-pocket expenses (including fees, disbursements
and charges of Cahill Gordon & Reindel LLP, counsel for the Initial Purchasers)
that shall have been incurred by the Initial Purchasers in connection with the
proposed purchase and sale of the Securities.

 

  7. CONDITIONS OF OBLIGATIONS OF THE INITIAL PURCHASERS.

 

The obligation of the Initial Purchasers to purchase the Firm Securities on the
Closing Date and the Option Securities, if any, on the Option Closing Date is
subject to the accuracy, as of the Closing Date or the Option Closing Date, as
the case may be, of the representations and warranties of the Company contained
herein, and to the performance by the Company of its covenants and obligations
hereunder and to the following additional conditions:

 

(a) On the Closing Date or the Option Closing Date, as the case may be, the
Initial Purchasers shall have received the opinion, dated as of the Closing Date
or the Option Closing Date, as the case may be, and addressed to the Initial
Purchasers, of:

 

(i) Kirkland & Ellis LLP, counsel for the Company, substantially in the form of
Exhibit B hereto. In rendering such opinion, Kirkland & Ellis LLP shall have
received and may rely upon such certificates and other documents and information
as it may reasonably request to pass upon such matters.

 

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(ii) Stuart Kupinsky, Esq., Executive Vice President, General Counsel and
Secretary for the Company, substantially in the form of Exhibit C hereto. In
rendering such opinion, Stuart Kupinsky shall have received and may rely upon
such certificates and other documents and information as he may reasonably
request to pass upon such matters

 

(b) On the Closing Date or the Option Closing Date, as the case may be, the
Initial Purchasers shall have received the opinion, in form and substance
reasonably satisfactory to the Initial Purchasers, dated as of the Closing Date
or the Option Closing Date, as the case may be and addressed to the Initial
Purchasers, of Cahill Gordon & Reindel LLP, counsel for the Initial Purchasers,
with respect to certain legal matters relating to this Agreement and such other
related matters as the Initial Purchasers may reasonably require. In rendering
such opinion, Cahill Gordon & Reindel LLP shall have received and may rely upon
such certificates and other documents and information as it may reasonably
request to pass upon such matters.

 

(c) The Initial Purchasers shall have received from the Independent Accountants
a comfort letter or letters dated the date hereof and the Closing Date and, if
applicable, the Option Closing Date, in form and substance reasonably
satisfactory to counsel for the Initial Purchasers.

 

(d) The representations and warranties of the Company contained in this
Agreement shall be true and correct in all material respects (except for those
representations and warranties that are qualified by materiality or Material
Adverse Effect, which shall be true and correct in all respects) on and as of
the date hereof and on and as of the Closing Date or the Option Closing Date, as
the case may be, as if made on and as of the Closing Date or the Option Closing
Date, as the case may be; the statements of the Company’s officers made pursuant
to any certificate delivered in accordance with the provisions hereof shall be
true and correct on and as of the date made and on and as of the Closing Date or
the Option Closing Date, as the case may be; the Company shall have performed in
all material respects all covenants and agreements and satisfied all conditions
on its part to be performed or satisfied hereunder at or prior to the Closing
Date or the Option Closing Date, as the case may be; and, except as described in
the Final Memorandum (exclusive of any amendment or supplement thereto after the
date hereof), subsequent to the date of the most recent financial statements in
such Final Memorandum, there shall have been no event or development, and no
information shall have become known, that, individually or in the aggregate, has
or would reasonably be expected to have a Material Adverse Effect.

 

(e) The sale of the Securities hereunder shall not be enjoined (temporarily or
permanently) on the Closing Date and, if applicable, the Option Closing Date.

 

(f) Subsequent to the date of the most recent financial statements in the Final
Memorandum (exclusive of any amendment or supplement thereto after the date
hereof), none of the Company or any of the Subsidiaries shall have sustained any
loss or interference with respect to its business or properties from fire,
flood, hurricane, accident or other calamity, whether or not covered by
insurance, or from any strike, labor dispute,

 

17

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slowdown or work stoppage or from any legal or governmental proceeding, order or
decree, which loss or interference, individually or in the aggregate, has or
would be reasonably be expected to have a Material Adverse Effect.

 

(g) The Initial Purchasers shall have received a certificate of the Company,
dated the Closing Date and, if applicable, the Option Closing Date, signed on
behalf of the Company by its Chairman of the Board, President or any Senior Vice
President and the Chief Financial Officer, to the effect that

 

(i) the representations and warranties of the Company contained in this
Agreement are true and correct in all material respects (except for those
representations and warranties that are qualified by materiality or Material
Adverse Effect, which shall be true and correct in all respects) on and as of
the date hereof and on and as of the Closing Date, and the Company has performed
all covenants and agreements and satisfied in all material respects all
conditions on its part to be performed in all material respects or satisfied
hereunder at or prior to the Closing Date or the Option Closing Date, as the
case may be;

 

(ii) at the Closing Date and, if applicable, the Option Closing Date, since the
date hereof or since the date of the most recent financial statements in the
Final Memorandum (exclusive of any amendment or supplement thereto after the
date hereof), no event or development has occurred, and no information has
become known, that, individually or in the aggregate, has or would reasonably be
expected to have a Material Adverse Effect; and

 

(iii) the sale of the Securities hereunder has not been enjoined (temporarily or
permanently).

 

(h) The Nasdaq National Market shall not have objected to the listing of the
Underlying Securities issuable upon conversion of the Securities on the Nasdaq
National Market and the Securities shall have been designated as Portal-eligible
securities.

 

(i) On the Closing Date, the Initial Purchasers shall have received the
Registration Rights Agreement and the Indenture executed by the Company and such
agreements shall be in full force and effect at all times from and after the
Closing Date.

 

(j) The Lock-up Agreements described in Section 5(j) shall be in full force and
effect.

 

On or before the Closing Date, the Initial Purchasers and counsel for the
Initial Purchasers shall have received such further documents, opinions,
certificates, letters and schedules or instruments relating to the business,
corporate, legal and financial affairs of the Company and the Subsidiaries as
they shall have heretofore reasonably requested from the Company.

 

All such documents, opinions, certificates, letters, schedules or instruments
delivered pursuant to this Agreement will comply with the provisions hereof only
if they are reasonably satisfactory in all material respects to the Initial
Purchasers and counsel for the Initial

 

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Purchasers. The Company shall furnish to the Initial Purchasers such conformed
copies of such documents, opinions, certificates, letters, schedules and
instruments in such quantities as the Initial Purchasers shall reasonably
request.

 

  8. OFFERING OF NOTES; RESTRICTIONS ON TRANSFER.

 

Each of the Initial Purchaser represents that it is an “accreditor investor”
within the meaning of Regulation D under the Act and a “QIB” within the meaning
of Rule 144A under the Securities Acts. Each of the Initial Purchasers agrees
with the Company (as to itself only) that (i) it has not and will not solicit
offers for, or offer or sell, the Securities by any form of general solicitation
or general advertising (as those terms are used in Regulation D under the
Securities Act) or in any manner involving a public offering within the meaning
of Section 4(2) of the Securities Act; and (ii) it has and will solicit offers
for the Securities only from, and will offer the Securities only to (A) in the
case of offers inside the United States, persons whom the Initial Purchasers
reasonably believe to be QIBs or, if any such person is buying for one or more
institutional accounts for which such person is acting as fiduciary or agent,
only when such person has represented to the Initial Purchasers that each such
account is a QIB, to whom notice has been given that such sale or delivery is
being made in reliance on Rule 144A, and, in each case, in transactions under
Rule 144A and (B) in the case of offers outside the United States, to persons
other than U.S. persons (“non-U.S. purchasers,” which term shall include dealers
or other professional fiduciaries in the United States acting on a discretionary
basis for non-U.S. beneficial owners (other than an estate or trust)); provided,
however, that, in the case of this clause (B), in purchasing such Securities
such persons are deemed to have represented and agreed as provided under the
caption “Notice to Investors” contained in the Final Memorandum (or, if the
Final Memorandum is not in existence, in the most recent Memorandum).

 

  9. INDEMNIFICATION AND CONTRIBUTION.

 

(a) The Company agrees to indemnify and hold harmless each Initial Purchaser and
each person, if any, who controls any Initial Purchaser within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act against any
losses, claims, damages or liabilities to which any Initial Purchaser or such
controlling person may become subject under the Securities Act, the Exchange Act
or otherwise, insofar as any such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon the following:

 

(i) any untrue statement or alleged untrue statement of any material fact
contained in any Memorandum or any amendment or supplement thereto; or

 

(ii) the omission or alleged omission to state, in any Memorandum or any
amendment or supplement thereto, a material fact required to be stated therein
or necessary to make the statements therein not misleading;

 

and will reimburse, as incurred, the Initial Purchasers and each such
controlling person for any legal or other expenses incurred by the Initial
Purchasers or such controlling person in connection with investigating,
defending against or appearing as a third-party witness in connection with any
such loss, claim, damage, liability or action; provided, however, the

 

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Company will not be liable in any such case to the extent that any such loss,
claim, damage, or liability arises out of or is based upon any untrue statement
or alleged untrue statement or omission or alleged omission made in any
Memorandum or any amendment or supplement thereto in reliance upon and in
conformity with written information concerning such Initial Purchasers furnished
to the Company by or on behalf of the Initial Purchasers specifically for use
therein. The indemnity provided for in this Section 9 will be in addition to any
liability that the Company may otherwise have to the indemnified parties. The
Company shall not be liable under this Section 9 for any settlement of any claim
or action effected without its prior written consent, which shall not be
unreasonably withheld.

 

(b) Each Initial Purchaser, severally and not jointly, agrees to indemnify and
hold harmless the Company, its directors, its officers, employees and affiliates
and each person, if any, who controls the Company within the meaning of Section
15 of the Securities Act or Section 20 of the Exchange Act against any losses,
claims, damages or liabilities to which the Company or any such director,
officer or controlling person may become subject under the Securities Act, the
Exchange Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon (i)
any untrue statement or alleged untrue statement of any material fact contained
in any Memorandum or any amendment or supplement thereto, or (ii) the omission
or the alleged omission to state therein a material fact required to be stated
in any Memorandum or any amendment or supplement thereto, or necessary to make
the statements therein not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon and in conformity with written
information concerning such Initial Purchaser furnished to the Company by or on
behalf of the Initial Purchasers specifically for use therein; and subject to
the limitation set forth immediately preceding this clause, will reimburse, as
incurred, any legal or other expenses incurred by the Company or any such
director, officer or controlling person in connection with investigating or
defending against or appearing as a third-party witness in connection with any
such loss, claim, damage, liability or action in respect thereof. The indemnity
provided for in this Section 9 will be in addition to any liability that the
Initial Purchasers may otherwise have to the indemnified parties. The Initial
Purchasers shall not be liable under this Section 9 for any settlement of any
claim or action effected without their consent, which shall not be unreasonably
withheld.

 

(c) Promptly after receipt by an indemnified party under this Section 9 of
notice of the commencement of any action for which such indemnified party is
entitled to indemnification under this Section 9, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party under
this Section 9, notify the indemnifying party of the commencement thereof in
writing; but the omission to so notify the indemnifying party (i) will not
relieve it from any liability under paragraph (a) or (b) above unless and to the
extent such failure results in the forfeiture by the indemnifying party of
substantial rights and defenses and (ii) will not, in any event, relieve the
indemnifying party from any obligations to any indemnified party other than the
indemnification obligation provided in paragraphs (a) and (b) above. In case any
such action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party;
provided, however, that if (i) the use of counsel chosen by the indemnifying

 

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party to represent the indemnified party would present such counsel with a
conflict of interest, (ii) the defendants in any such action include both the
indemnified party and the indemnifying party and the indemnified party shall
have been advised by counsel that there may be one or more legal defenses
available to it and/or other indemnified parties that are different from or
additional to those available to the indemnifying party or (iii) the
indemnifying party shall not have employed counsel reasonably satisfactory to
the indemnified party to represent the indemnified party within a reasonable
time after receipt by the indemnifying party of notice of the institution of
such action, then, in each such case, the indemnifying party shall not have the
right to direct the defense of such action on behalf of such indemnified party
or parties and such indemnified party or parties shall have the right to select
separate counsel to defend such action on behalf of such indemnified party or
parties. After notice from the indemnifying party to such indemnified party of
its election so to assume the defense thereof and approval by such indemnified
party of counsel appointed to defend such action, the indemnifying party will
not be liable to such indemnified party under this Section 9 for any legal or
other expenses, other than reasonable costs of investigation, subsequently
incurred by such indemnified party in connection with the defense thereof,
unless (i) the indemnified party shall have employed separate counsel in
accordance with the proviso to the immediately preceding sentence (it being
understood, however, that in connection with such action the indemnifying party
shall not be liable for the expenses of more than one separate counsel (in
addition to local counsel) in any one action or separate but substantially
similar actions in the same jurisdiction arising out of the same general
allegations or circumstances, designated by the Initial Purchasers in the case
of paragraph (a) of this Section 9 or the Company in the case of paragraph (b)
of this Section 9, representing the indemnified parties under such paragraph (a)
or paragraph (b), as the case may be, who are parties to such action or actions)
or (ii) the indemnifying party has authorized in writing the employment of
counsel for the indemnified party at the expense of the indemnifying party. All
fees and expenses reimbursed pursuant to this paragraph (c) shall be reimbursed
as they are incurred. After such notice from the indemnifying party to such
indemnified party, the indemnifying party will not be liable for the costs and
expenses of any settlement of such action effected by such indemnified party
without the prior written consent of the indemnifying party (which consent shall
not be unreasonably withheld), unless such indemnified party waived in writing
its rights under this Section 9, in which case the indemnified party may effect
such a settlement without such consent. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement or
compromise of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party, or indemnity could have been
sought hereunder by any indemnified party, unless such settlement (A) includes
an unconditional written release of the indemnified party, in form and substance
reasonably satisfactory to the indemnified party, from all liability on claims
that are the subject matter of such proceeding and (B) does not include any
statement as to an admission of fault, culpability or failure to act by or on
behalf of any indemnified party.

 

(d) In circumstances in which the indemnity agreement provided for in the
preceding paragraphs of this Section 9 is unavailable to, or insufficient to
hold harmless, an indemnified party in respect of any losses, claims, damages or
liabilities (or actions in respect thereof), each indemnifying party, in order
to provide for just and equitable contribution, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages or liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect (i) the relative benefits received by the indemnifying
party or parties on the one hand

 

21

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and the indemnified party on the other from the offering of the Securities or
(ii) if the allocation provided by the foregoing clause (i) is not permitted by
applicable law, not only such relative benefits but also the relative fault of
the indemnifying party or parties on the one hand and the indemnified party on
the other in connection with the statements or omissions or alleged statements
or omissions that resulted in such losses, claims, damages or liabilities (or
actions in respect thereof). The relative benefits received by the Company on
the one hand and any Initial Purchaser on the other shall be deemed to be in the
same proportion as the total proceeds from the offering (before deducting
expenses) received by the Company bear to the total discounts and commissions
received by such Initial Purchaser. The relative fault of the parties shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company on the one hand,
or such Initial Purchaser on the other, the parties’ relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission or alleged statement or omission, and any other equitable
considerations appropriate in the circumstances. The Company and the Initial
Purchasers agree that it would not be equitable if the amount of such
contribution were determined by pro rata or per capita allocation or by any
other method of allocation that does not take into account the equitable
considerations referred to in the first sentence of this paragraph (d).
Notwithstanding any other provision of this paragraph (d), no Initial Purchasers
shall be obligated to make contributions hereunder that in the aggregate exceed
the total discounts, commissions and other compensation received by such Initial
Purchaser under this Agreement, less the aggregate amount of any damages that
such Initial Purchaser has otherwise been required to pay by reason of the
untrue or alleged untrue statements or the omissions or alleged omissions to
state a material fact, and 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. For purposes of this paragraph (d), each person, if any, who
controls an Initial Purchaser within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act shall have the same rights to contribution
as the Initial Purchasers, and each director of the Company, each officer,
employee or affiliate of the Company and each person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act, shall have the same rights to contribution as the Company.

 

  10. SURVIVAL CLAUSE.

 

The respective representations, warranties, agreements, covenants, indemnities
and other statements of the Company, its officers and the Initial Purchasers set
forth in this Agreement or made by or on behalf of them pursuant to this
Agreement shall remain in full force and effect, regardless of (i) any
investigation made by or on behalf of the Company, any of its officers or
directors, the Initial Purchasers or any controlling person referred to in
Section 9 hereof and (ii) delivery of and payment for the Securities. The
respective agreements, covenants, indemnities and other statements set forth in
Sections 6, 9, 10 and 15 hereof shall remain in full force and effect,
regardless of any termination or cancellation of this Agreement.

 

22

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  11. TERMINATION.

 

(a) This Agreement may be terminated in the sole discretion of the Initial
Purchasers by notice to the Company given prior to the Closing Date in the event
that the Company shall have failed, refused or been unable to perform all
obligations and satisfy all conditions on its part to be performed or satisfied
hereunder at or prior thereto or, if at or prior to the Closing Date,

 

(i) any of the Company or the Subsidiaries shall have sustained any loss or
interference with respect to its businesses or properties from fire, flood,
hurricane, accident or other calamity, whether or not covered by insurance, or
from any strike, labor dispute, slow down or work stoppage or any legal or
governmental proceeding, which loss or interference, in the reasonable judgment
of the Initial Purchasers, has had or has a Material Adverse Effect, or there
shall have been, in the reasonable judgment of the Initial Purchasers, any event
or development that, individually or in the aggregate, has or would reasonably
be likely to have a Material Adverse Effect (including without limitation a
change in control of the Company), except in each case as described in the Final
Memorandum (exclusive of any amendment or supplement thereto);

 

(ii) trading in securities of the Company or in securities generally on the New
York Stock Exchange, American Stock Exchange or the NASDAQ National Market shall
have been suspended or materially limited or minimum or maximum prices shall
have been established on any such exchange or market;

 

(iii) a banking moratorium shall have been declared by New York or United States
authorities or a material disruption in commercial banking or securities
settlement or clearance services in the United States;

 

(iv) there shall have been (A) an outbreak or escalation of hostilities between
the United States and any foreign power, or (B) an outbreak or escalation of any
other insurrection or armed conflict involving the United States or any other
national or international calamity or emergency, or (C) any material change in
the financial markets of the United States which, in the case of (A), (B) or (C)
above and in the reasonable judgment of the Initial Purchasers, makes it
impracticable or inadvisable to proceed with the offering or the delivery of the
Notes as contemplated by the Final Memorandum; or

 

(v) any securities of the Company shall have been downgraded by any nationally
recognized statistical rating organization or any such organization shall have
publicly announced that it has under surveillance or review, or has changed its
outlook with respect to, its ratings of any securities of the Company (other
than an announcement with positive implications of a possible upgrading).

 

(b) Termination of this Agreement pursuant to this Section 11 shall be without
liability of any party to any other party except as provided in Section 10
hereof.

 

  12. INFORMATION SUPPLIED BY THE INITIAL PURCHASERS.

 

The statements set forth in the last paragraph on the front cover page, first
sentence of the seventh paragraph and in the third and fourth sentence of the
tenth paragraph under the heading “Private Placement” in the Final Memorandum
(to the extent such statements

 

23

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relate to the Initial Purchasers) constitute the only information furnished by
the Initial Purchasers to the Company for the purposes of Sections 2(a) and 9
hereof.

 

  13. NOTICES.

 

All communications hereunder shall be in writing and, if sent to the Initial
Purchasers, shall be mailed or delivered to (i) Deutsche Bank Securities Inc.,
60 Wall Street, New York, New York 10005, Attention: Corporate Finance
Department, with a copy to Cahill Gordon & Reindel LLP, 80 Pine Street, New
York, New York 10005, Attention: John A. Tripodoro; and (ii) if sent to the
Company, shall be mailed or delivered to the Company at Exide Technologies,
Office of the General Counsel, 13000 Deerfield Parkway, Building 200,
Alpharetta, Georgia 30004, Attention: Stuart Kupinsky, with a copy to Kirkland &
Ellis LLP, Aon Center, 200 E. Randolph Dr., Chicago, IL 60601, Attention: Carter
W. Emerson, P.C.

 

All such notices and communications shall be deemed to have been duly given:
when delivered by hand, if personally delivered; five business days after being
deposited in the mail, postage prepaid, if mailed; one business day after being
timely delivered to a next-day air courier guaranteeing overnight delivery; and
when receipt is acknowledged by the addressee, if telecopied.

 

  14. SUCCESSORS.

 

This Agreement shall inure to the benefit of and be binding upon the Initial
Purchasers the Company and their respective successors and legal
representatives, and nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any other person any legal or equitable
right, remedy or claim under or in respect of this Agreement, or any provisions
herein contained; this Agreement and all conditions and provisions hereof being
intended to be and being for the sole and exclusive benefit of such persons and
for the benefit of no other person except that (i) the indemnities of the
Company contained in Section 9 of this Agreement shall also be for the benefit
of any person or persons who control the Initial Purchasers within the meaning
of Section 15 of the Securities Act or Section 20 of the Exchange Act and (ii)
the indemnities of the Initial Purchasers contained in Section 9 of this
Agreement shall also be for the benefit of the directors of the Company, its
officers, employees and affiliates and any person or persons who control the
Company within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act. No purchaser of Notes from the Initial Purchasers will be
deemed a successor because of such purchase.

 

  15. APPLICABLE LAW.

 

THE VALIDITY AND INTERPRETATION OF THIS AGREEMENT, AND THE TERMS AND CONDITIONS
SET FORTH HEREIN SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED WHOLLY
THEREIN, WITHOUT GIVING EFFECT TO ANY PROVISIONS THEREOF RELATING TO CONFLICTS
OF LAW.

 

24

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  16. COUNTERPARTS.

 

This Agreement may be executed in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and the
same instrument.

 

  17. GENERAL PROVISIONS.

 

This Agreement constitutes the entire agreement of the parties to this Agreement
and supersedes all prior written or oral and all contemporaneous oral
agreements, understandings and negotiations with respect to the subject matter
hereof. This Agreement may not be amended or modified unless in writing by all
of the parties hereto, and no condition herein (express or implied) may be
waived unless waived in writing by each party whom the condition is meant to
benefit.

 

25

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If the foregoing correctly sets forth our understanding, please indicate your
acceptance thereof in the space provided below for that purpose, whereupon this
letter shall constitute a binding agreement between the Company and the Initial
Purchasers.

 

Very truly yours,

EXIDE TECHNOLOGIES

By:

   

Name:

   

Title:

   

 

The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.

DEUTSCHE BANK SECURITIES INC.

By:

   

Name:

   

Title:

   

By:

   

Name:

   

Title:

   

 

26

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CREDIT SUISSE FIRST BOSTON LLC

By:

   

Name:

   

Title:

   

 

27

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SCHEDULE I

 

List of Subsidiaries

 

Initial Purchasers

--------------------------------------------------------------------------------

   Principal Amount
of Firm Securities
to be Purchased

--------------------------------------------------------------------------------

Deutsche Bank Securities Inc.

   $ 48,000,000

Credit Suisse First Boston LLC

     12,000,000     

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

Total

   $ 60,000,000

 

--------------------------------------------------------------------------------

 

SCHEDULE II

 

List of Specified Parties to Execute Lock-up Agreements

 

Gordon A. Ulsh

 

II-1

--------------------------------------------------------------------------------

 

Exhibit A

 

[FORM OF LOCK-UP AGREEMENT]

 

March [    ], 2005

 

Deutsche Bank Securities Inc.

60 Wall Street

New York, NY 10005

 

Ladies and Gentlemen:

 

The undersigned understands that Deutsche Bank Securities Inc. and Credit Suisse
First Boston LLC (collectively, the “Initial Purchaser”) proposes to enter into
a Purchase Agreement (the “Purchase Agreement”) with Exide Technologies, a
Delaware corporation (the “Company”), providing for the offering (the
“Offering”) by the Initial Purchaser of securities convertible into shares of
common stock, par value $0.01, of the Company (the “Common Stock”).

 

To induce the Initial Purchaser that will participate in any such Offering to
continue its efforts in connection with such Offering, the undersigned hereby
agrees that, without the prior written consent of the Initial Purchaser, it will
not, during the period commencing on the date hereof and ending 90 days after
the date of the final offering memorandum relating to such Offering (the “Final
Memorandum”), (1) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option to sell or contract to sell, grant any
option, right or warrant to purchase, lend or otherwise transfer or dispose of,
directly or indirectly, any shares of Common Stock or any securities convertible
into or exercisable or exchangeable for Common Stock, or (2) enter into any swap
or other arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of the Common Stock, whether any such
transaction described in clause (1) or (2) above is to be settled by delivery of
Common Stock or such other securities, in cash or otherwise. The foregoing
sentence shall not apply to transactions relating to shares of Common Stock or
other securities acquired in open market transactions after the completion of
the Offering. In addition, the undersigned agrees that, without the prior
written consent of the Initial Purchaser, it will not, during the period
commencing on the date hereof and ending 90 days after the date of the Final
Memorandum, make any demand for or exercise any right with respect to, the
registration of any shares of Common Stock or any security convertible into or
exercisable or exchangeable for Common Stock. The undersigned also agrees and
consents to the entry of stop transfer instructions with the Company’s transfer
agent and registrar against the transfer of the undersigned’s shares of Common
Stock except in compliance with the foregoing restrictions. Notwithstanding the
foregoing, the undersigned may transfer the undersigned’s Common Stock (i) as a
bona fide gift or gifts, provided that the donee or donees thereto agree to be
bound in writing by the restrictions set forth herein or (ii) to any trust for
the direct or indirect benefit of the undersigned or the immediate family of the
undersigned, provided, further, that the trustee of such trust agrees to be
bound in writing by the restrictions set forth herein. For purposes of this
Lock-Up Agreement,

 

A-1

--------------------------------------------------------------------------------

“immediate family” includes any relationship by blood, adoption or marriage, not
more remote than first cousin.

 

The undersigned understands that the Company and the Initial Purchaser are
relying upon this Lock-up Agreement in proceeding toward consummation of the
Offering. The undersigned further understands that this Lock-up Agreement is
irrevocable and shall be binding upon the undersigned’s heirs, legal
representatives, successors and assigns.

 

Whether or not any Offering actually occurs depends on a number of factors,
including market conditions. Any Offering will only be made pursuant to the
Purchase Agreement, the terms of which are subject to negotiation between the
Company and the Initial Purchaser.

 

Very truly yours,

 

Name:

 

A-2

--------------------------------------------------------------------------------

 

Exhibit B

 

Opinion of Kirkland & Ellis LLP

 

B-1

--------------------------------------------------------------------------------

 

Exhibit C

 

Opinion of Stuart Kupinsky

 

C-1