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EXHIBIT 1.1
EXECUTION COPY
PURCHASE AGREEMENT
Di Giorgio Corporation
10% Senior Notes Due 2007
June 13, 1997
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TABLE OF CONTENTS
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SECTION 1. Representations and Warranties................................. 3
(a) Representations and Warranties by the Company.................. 3
(i) Similar Offerings..................................... 3
(ii) Offering Memorandum................................... 3
(iii) Incorporated Documents................................ 3
(iv) Independent Accountants............................... 4
(v) Financial Statements.................................. 4
(vi) No Material Adverse Change in Business................ 4
(vii) Good Standing of the Company.......................... 4
(viii) Good Standing of Subsidiaries......................... 5
(ix) Capitalization........................................ 5
(x) Authorization of Agreement............................ 5
(xi) Authorization of Registration Rights Agreement........ 5
(xii) Authorization of the Indenture........................ 6
(xiii) Authorization of the Securities....................... 6
(xiv) Description of the Securities and the Indenture....... 6
(xv) Absence of Defaults and Conflicts..................... 6
(xvi) Absence of Labor Dispute.............................. 7
(xvii) Absence of Proceedings................................ 7
(xviii) Possession of Intellectual Property................... 8
(xix) Absence of Further Requirements....................... 8
(xx) Possession of Licenses and Permits.................... 8
(xxi) Title to Property..................................... 8
(xxii) Environmental Laws.................................... 9
(xxiii) Material Contracts.................................... 9
(xxiv) Tax Returns.......................................... 10
(xxv) Internal Controls.................................... 10
(xxvi) Insurance............................................ 10
(xxvii) Solvency.............................................. 10
(xxviii) Stabilization........................................ 11
(xxix) Suppliers............................................. 11
(xxx) Investment Company Act............................... 11
(xxxi) Rule 144A Eligibility................................. 11
(xxxii) No General Solicitation.............................. 11
(xxxiii) No Registration Required............................. 11
(xxxiv) No Directed Selling Efforts........................... 11
(b) Officer's Certificates........................................ 12
SECTION 2. Sale and Delivery to Initial Purchasers; Closing.............. 12
(a) Securities.................................................... 12
(b) Payment....................................................... 12
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(c) Qualified Institutional Buyer...................................................... 12
(d) Denominations; Registration........................................................ 13
SECTION 3. Covenants of the Company........................................................... 13
(a) Offering Memorandum................................................................ 13
(b) Notice and Effect of Material Events............................................... 13
(c) Amendment to Offering Memorandum and Supplements................................... 13
(d) Qualification of Securities for Offer and Sale..................................... 14
(e) Rating of Securities............................................................... 14
(f) DTC and PORTAL..................................................................... 14
(g) Use of Proceeds.................................................................... 14
(h) Restriction on Sale of Securities.................................................. 14
SECTION 4. Payment of Expenses................................................................ 14
(a) Expenses........................................................................... 14
(b) Termination of Agreement........................................................... 15
SECTION 5. Conditions of Initial Purchasers' Obligations...................................... 15
(a) Opinion of Counsel for Company..................................................... 15
(b) Opinion of Counsel for Initial Purchasers.......................................... 15
(c) Officers' Certificate.............................................................. 15
(d) Accountant's Comfort Letter........................................................ 16
(e) Bring-down Comfort Letter.......................................................... 16
(f) Maintenance of Rating.............................................................. 16
(g) PORTAL............................................................................. 16
(h) Refinancing........................................................................ 16
(i) Additional Documents............................................................... 17
(j) Termination of Agreement........................................................... 17
SECTION 6. Subsequent Offers and Resales of the Securities.................................... 17
(a) Offer and Sale Procedures.......................................................... 17
(i) Offers and Sales only to Institutional Accredited Investors or Qualified
Institutional Buyers...................................................... 17
(ii) No General Solicitation................................................... 18
(iii) Purchases by Non-Bank Fiduciaries......................................... 18
(iv) Subsequent Purchaser Notification......................................... 18
(v) Minimum Principal Amount.................................................. 18
(vi) Restrictions on Transfer.................................................. 18
(vii) Delivery of Offering Memorandum........................................... 19
(b) Covenants of the Company........................................................... 19
(i) Due Diligence............................................................. 19
(ii) Integration............................................................... 19
(iii) Rule 144A Information..................................................... 19
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(iv) Restriction on Repurchases................................. 19
(c) Resale Pursuant to Rule 903 of Regulation S or Rule 144A............ 20
SECTION 7. Indemnification..................................................... 20
(a) Indemnification of Initial Purchasers............................... 20
(b) Indemnification of Company, Directors and Officers.................. 21
(c) Actions against Parties; Notification............................... 22
(d) Settlement without Consent if Failure to Reimburse.................. 22
SECTION 8. Contribution........................................................ 22
SECTION 9. Representations, Warranties and Agreements to Survive Delivery...... 24
SECTION 10. Termination of Agreement............................................ 24
(a) Termination; General................................................ 24
(b) Liabilities......................................................... 24
SECTION 11. Default by One of the Initial Purchasers............................ 25
SECTION 12. Notices............................................................. 25
SECTION 13. Parties............................................................. 25
SECTION 14. GOVERNING LAW AND TIME.............................................. 26
SECTION 15. Effect of Headings.................................................. 26
SECTION 16. Counterparts........................................................ 26
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$155,000,000
DI GIORGIO CORPORATION
10% Senior Notes due 2007
PURCHASE AGREEMENT
June 13, 1997
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
BT Securities Corporation
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Ladies and Gentlemen:
Di Giorgio Corporation, a Delaware corporation (the "Company"),
confirms its agreement with ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ &
▇▇▇▇▇ Incorporated ("▇▇▇▇▇▇▇ ▇▇▇▇▇") and BT Securities Corporation
(collectively, the "Initial Purchasers," which term shall also include any
initial purchaser substituted as hereinafter provided in Section 11 hereof), for
whom ▇▇▇▇▇▇▇ ▇▇▇▇▇ is acting as representative (in such capacity, the
"Representative"), with respect to the issue and sale by the Company and the
purchase by the Initial Purchasers, acting severally and not jointly, of the
respective principal amounts set forth in Schedule A of $155,000,000 aggregate
principal amount of the Company's 10% Senior Notes due 2007 (the "Securities").
The Securities are to be issued pursuant to an indenture to be dated as of June
15, 1997 (the "Indenture") between the Company and The Bank of New York, as
trustee (the "Trustee"). Securities issued in book-entry form will be issued to
Cede & Co. as nominee of The Depository Trust Company ("DTC") pursuant to a
letter agreement, to be dated as of the Closing Time (as defined in Section
2(b)) (the "DTC Agreement"), among the Company, the Trustee and DTC.
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The Company understands that the Initial Purchasers propose to make an
offering of the Securities on the terms and in the manner set forth herein and
agrees that the Initial Purchasers may resell, subject to the conditions set
forth herein, all or a portion of the Securities to purchasers ("Subsequent
Purchasers") at any time after the date of this Agreement. The Securities are to
be offered and sold through the Initial Purchasers without being registered
under the Securities Act of 1933, as amended (the "1933 Act"), in reliance upon
exemptions therefrom. Pursuant to the terms of the Securities and the Indenture,
investors that acquire Securities may only resell or otherwise transfer such
Securities if such Securities are hereafter registered under the 1933 Act or if
an exemption from the registration requirements of the 1933 Act is available
(including, without limitation, the exemption afforded by Rule 144A ("Rule
144A") or Regulation S ("Regulation S") of the rules and regulations promulgated
under the 1933 Act by the Securities and Exchange Commission (the
"Commission")).
The holders of Securities will be entitled to the benefits of a
Registration Rights Agreement between the Company and the Initial Purchasers
(the "Registration Rights Agreement"), pursuant to which the Company will file a
registration statement (the "Registration Statement") with the Commission
registering the Notes or the Exchange Notes referred to in the Registration
Rights Agreement under the ▇▇▇▇ ▇▇▇.
The Company has prepared and delivered to each Initial Purchaser copies
of a preliminary offering memorandum dated May 29, 1997 (the "Preliminary
Offering Memorandum") and is preparing and will deliver to the Initial
Purchasers, on the date hereof or the next succeeding day, copies of a final
offering memorandum dated June 13, 1997 (the "Final Offering Memorandum"), for
use by the Initial Purchasers in connection with its solicitation of purchases
of or offering of, the Securities. "Offering Memorandum" means, with respect to
any date or time referred to in this Agreement, the most recent offering
memorandum (whether the Preliminary Offering Memorandum or the Final Offering
Memorandum, or any amendment or supplement to either such document), including
exhibits thereto and any documents incorporated therein by reference, which has
been prepared and delivered by the Company to the Initial Purchasers in
connection with their solicitation of purchases of, or offering of, the
Securities.
The Company has obtained the consent of a sufficient number of holders
of its 12% Senior Notes Due 2003 (the "Senior Notes") to execute, and has
executed, a Supplemental Indenture dated as of June 9, 1997 (the "Supplemental
Indenture") effecting certain amendments to the Indenture dated as of February
1, 1993 between the Company and the Bank of New York, as trustee, as more fully
described in the Company's Offer to Purchase and Consent Solicitation relating
thereto dated May 16, 1997. It is understood and agreed that concurrently with
or immediately following the Closing Time referred to in Section 2(b) hereof,
the Company will (i) dividend approximately $61,400 in cash and certain non-cash
assets which are unrelated to the Company's primary business, (ii) make an
intercompany loan to its sole stockholder, ▇▇▇▇▇ ▇▇▇▇ Foods, Inc. ("▇▇▇▇▇
▇▇▇▇"), as set forth in the Final Offering Memorandum, and (iii) merge with
▇▇▇▇▇ ▇▇▇▇, with the Company surviving the merger.
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All references in this Agreement to financial statements and schedules
and other information which is "contained," "included" or "stated" in the
Offering Memorandum (or other references of like import) shall be deemed to mean
and include all such financial statements and schedules and other information
which are incorporated by reference in the Offering Memorandum; and all
references in this Agreement to amendments or supplements to the Offering
Memorandum shall be deemed to mean and include the filing of any document under
the Securities Exchange Act of 1934, as amended (the "1934 Act") which is
incorporated by reference in the Offering Memorandum.
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company. The Company
represents and warrants to each Initial Purchaser as of the date hereof, and as
of the Closing Time referred to in Section 2(b) hereof, and agrees with each
Initial Purchaser as follows:
(i) Similar Offerings. The Company has not, directly or
indirectly, solicited any offer to buy or offered to sell, and will
not, directly or indirectly, solicit any offer to buy or offer to sell,
in the United States or to any United States citizen or resident, any
security which is or would be integrated with the sale of the
Securities in a manner that would require the Securities to be
registered under the 1933 Act.
(ii) Offering Memorandum. As of the date hereof, the Offering
Memorandum does not, and at the Closing Time will not, include an
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that
this representation, warranty and agreement shall not apply to
statements in or omissions from the Offering Memorandum made in
reliance upon and in conformity with information furnished to the
Company in writing by any Initial Purchaser through the Representative
expressly for use in the Offering Memorandum.
(iii) Incorporated Documents. The Offering Memorandum as
delivered from time to time shall incorporate by reference the most
recent Annual Report of the Company on Form 10-K filed with the
Commission and each Quarterly Report of the Company on Form 10-Q and
each Current Report of the Company on Form 8-K filed with the
Commission since the end of the fiscal year to which such Annual Report
relates. The documents incorporated or deemed to be incorporated by
reference in the Offering Memorandum at the time they were or hereafter
are filed with the Commission complied and will comply in all material
respects with the requirements of the 1934 Act and the rules and
regulations of the Commission promulgated thereunder (the "1934 Act
Regulations"), and, when read together with the other information in
the Offering Memorandum, at the date of the Offering Memorandum and at
the Closing Time, do not and will not include an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
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(iv) Independent Accountants. Deloitte & Touche L.L.P. is an
independent certified public accountant with respect to the Company and
its subsidiaries within the meaning of Rule 2-01 of Regulation S-X
under the 1933 Act.
(v) Financial Statements. The financial statements, together
with the related schedules and notes, included in the Offering
Memorandum (excluding the pro forma financial statements) present
fairly the financial position of the Company and its consolidated
subsidiaries (and, where applicable, the Consolidated Company (as
defined in the Offering Memorandum)) at the dates indicated and the
statement of operations, stockholders' equity and cash flows of the
Company and its consolidated subsidiaries (and, where applicable, the
Consolidated Company) for the periods specified; said financial
statements have been prepared in conformity with generally accepted
accounting principles ("GAAP") applied on a consistent basis throughout
the periods involved. The selected financial data and the summary
financial information included in the Offering Memorandum present
fairly the information shown therein and have been compiled on a basis
consistent with that of the audited financial statements included in
the Offering Memorandum. The pro forma financial statements of the
Company and its subsidiaries and the related notes thereto included in
the Offering Memorandum present fairly the information shown therein,
have been prepared in accordance with the Commission's rules and
guidelines with respect to pro forma financial statements and have been
properly compiled on the bases described therein, and the assumptions
used in the preparation thereof are reasonable and the adjustments used
therein are appropriate to give effect to the transactions and
circumstances referred to therein.
(vi) No Material Adverse Change in Business. Since the
respective dates as of which information is given in the Offering
Memorandum, except as otherwise stated therein, (A) there has been no
material adverse change in the condition, financial or otherwise, or in
the earnings, business affairs or business prospects of the Company and
its Subsidiaries (as defined below) considered as one enterprise (a
"Material Adverse Effect"), whether or not arising in the ordinary
course of business, (B) except as set forth in the Offering Memorandum
under the caption "The Refinancing," there have been no transactions
entered into by the Company or any of its Subsidiaries, other than
those in the ordinary course of business, which are material with
respect to the Company and its Subsidiaries considered as one
enterprise, and (C) except for the payment of a dividend of
approximately $61,400 in cash and certain non-cash assets as set forth
in the Offering Memorandum under the caption "The Refinancing," there
has been no dividend or distribution of any kind declared, paid or made
by the Company on any class of its capital stock.
(vii) Good Standing of the Company. The Company has been duly
organized and is validly existing as a corporation in good standing
under the laws of the State of Delaware and has corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Offering Memorandum and to enter into and
perform its obligations under this Agreement, and the Company is duly
qualified as
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a foreign corporation to transact business and is in good standing in
each other jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure so to qualify or to be in
good standing would not result in a Material Adverse Effect.
(viii) Good Standing of Subsidiaries. Each subsidiary of the
Company (each a "Subsidiary" and, collectively, the "Subsidiaries") has
been duly organized and is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation, has
corporate power and authority to own, lease and operate its properties
and to conduct its business as described in the Offering Memorandum and
is duly qualified as a foreign corporation to transact business and is
in good standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or
the conduct of business, except where the failure so to qualify or to
be in good standing would not result in a Material Adverse Effect;
except as otherwise disclosed in the Offering Memorandum, all of the
issued and outstanding capital stock of each Subsidiary has been duly
authorized and validly issued, is fully paid and non-assessable and is
owned by the Company, directly or through Subsidiaries, free and clear
of any security interest, mortgage, pledge, lien, encumbrance, claim or
equity; none of the outstanding shares of capital stock of the
Subsidiaries was issued in violation of any preemptive or other rights
of any person. The Company has no Subsidiaries that are or would be
"significant subsidiaries" of the Company within the meaning of that
term as used in Rule 1-02(w) of Regulation S-X promulgated under the
1933 Act.
(ix) Capitalization. The authorized, issued and outstanding
capital stock of the Company is as set forth in the Offering Memorandum
in the column entitled "Actual" under the caption "Capitalization."
(x) Authorization of Agreement. This Agreement has been duly
authorized, executed and delivered by the Company, and constitutes a
valid and binding agreement of the Company, enforceable against the
Company in accordance with its terms, except as the enforcement thereof
may be limited by bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers), reorganization,
moratorium or other laws of general applicability relating to or
affecting enforcement of creditors' rights generally, or by general
principles of equity (regardless of whether enforcement is considered
in a proceeding in equity or at law).
(xi) Authorization of Registration Rights Agreement. The
Registration Rights Agreement has been duly authorized by the Company,
and when executed and delivered by the Company will constitute a valid
and binding agreement of the Company, enforceable against the Company
in accordance with its terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency (including, without limitation, all
laws relating to fraudulent transfers), reorganization, moratorium or
other laws of general applicability relating to or affecting
enforcement of creditors' rights generally, or by
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general principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law).
(xii) Authorization of the Indenture. The Indenture has been
duly authorized by the Company, and when executed and delivered by the
Company will constitute a valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms, except as
the enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or other laws of general
applicability relating to or affecting enforcement of creditors' rights
generally, or by general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law).
(xiii) Authorization of the Securities. The Securities have been
duly authorized and when executed and delivered by the Company and
authenticated in the manner provided for in the Indenture and delivered
against payment of the purchase price therefor as provided in this
Agreement, will constitute valid and binding obligations of the
Company, enforceable against the Company in accordance with their
terms, except as the enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to
fraudulent transfers) reorganization, moratorium or other laws of
general applicability relating to or affecting enforcement of
creditors' rights generally, or by general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law), and will be in the form contemplated by, and
entitled to the benefits of, the Indenture.
(xiv) Description of the Securities and the Indenture. The
Securities and the Indenture will conform in all material respects to
the respective statements relating thereto contained in the Offering
Memorandum and will be in substantially the respective forms previously
delivered to the Initial Purchasers.
(xv) Absence of Defaults and Conflicts. Neither the Company nor
any of its Subsidiaries is in violation of its charter or by-laws or in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage,
deed of trust, loan or credit agreement, note, lease or other agreement
or instrument to which the Company or any of its Subsidiaries is a
party or by which it or any of them may be bound, or to which any of
the property or assets of the Company or any of its Subsidiaries is
subject (collectively, "Agreements and Instruments") except for such
defaults that would not result in a Material Adverse Effect; and the
execution, delivery and performance of this Agreement, the Indenture
and the Securities and any other agreement or instrument entered into
or issued or to be entered into or issued by the Company in connection
with the transactions contemplated hereby or thereby or in the Offering
Memorandum and the consummation of the transactions contemplated herein
and in the Offering Memorandum (including the issuance and sale of the
Securities, the use of the proceeds from the sale of the Securities as
described in the Offering Memorandum under the caption "Use of
Proceeds", the modification of the
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Company's Bank Credit Facility and the consummation of all of the other
transactions comprising the Refinancing) and compliance by the Company
with its obligations hereunder have been duly authorized by all
necessary corporate action and do not and will not, whether with or
without the giving of notice or passage of time or both, conflict with
or constitute a breach of, or default or a Repayment Event (as defined
below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any
of its Subsidiaries pursuant to, the Agreements and Instruments (except
for such conflicts, breaches or defaults or liens, charges or
encumbrances that, singly or in the aggregate, would not result in a
Material Adverse Effect), nor will such action result in any violation
of the provisions of the charter or by-laws of the Company or any of
its Subsidiaries or any applicable law, statute, rule, regulation,
judgment, order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over
the Company or any of its Subsidiaries or any of their assets or
properties, except for such violation that would not result in a
Material Adverse Effect. As used herein, a "Repayment Event" means any
event or condition which gives the holder of any note, debenture or
other evidence of indebtedness (or any person acting on such holder's
behalf) the right to require the repurchase, redemption or repayment of
all or a portion of such indebtedness by the Company or any of its
Subsidiaries.
(xvi) Absence of Labor Dispute. No labor dispute with the
employees of the Company or any of its Subsidiaries exists or, to the
knowledge of the Company, is imminent, and the Company is not aware of
any existing or imminent labor disturbance by the employees of any of
its, or any Subsidiary's, principal suppliers, manufacturers, customers
or contractors, which, in either case, may reasonably be expected to
result in a Material Adverse Affect.
(xvii) Absence of Proceedings. Except as disclosed in the
Offering Memorandum, there is no action, suit, proceeding, inquiry or
investigation before or brought by any court or governmental agency or
body, domestic or foreign, now pending, or, to the knowledge of the
Company, threatened, against or affecting the Company or any Subsidiary
thereof which might reasonably be expected to result in a Material
Adverse Effect, or which might reasonably be expected to materially and
adversely affect the properties or assets of the Company or any of its
Subsidiaries or the consummation of this Agreement or either of the
Tender Offers (as defined in the Offering Memorandum) or other
transactions comprising the Refinancing, or the performance by the
Company of its obligations hereunder or thereunder. The aggregate of
all pending legal or governmental proceedings to which the Company or
any Subsidiary thereof is a party or of which any of their respective
property or assets is the subject which are not described in the
Offering Memorandum, including ordinary routine litigation incidental
to the business, could not reasonably be expected to result in a
Material Adverse Effect.
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(xviii) Possession of Intellectual Property. The Company and its
Subsidiaries own or possess, or can acquire on reasonable terms,
adequate patents, patent rights, licenses, inventions, copyrights,
know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks, trade names or other
intellectual property (collectively, "Intellectual Property"),
necessary to carry on the business now operated by them, and neither
the Company nor any of its Subsidiaries has received any notice or is
otherwise aware of any infringement of or conflict with asserted rights
of others with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property invalid or
inadequate to protect the interest of the Company or any of its
Subsidiaries therein, and which infringement or conflict (if the
subject of any unfavorable decision, ruling or finding) or invalidity
or inadequacy, singly or in the aggregate, would result in a Material
Adverse Effect.
(xix) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or
agency (other than (A) under the 1933 Act and the rules and regulations
thereunder with respect to the Registration Statement to be filed
pursuant to the Registration Rights Agreement and the transactions
contemplated thereunder, and (B) under the securities or "blue sky"
laws of the various states) is necessary or required for the
performance by the Company of its obligations hereunder, in connection
with the offering, issuance or sale of the Securities hereunder or the
consummation of the transactions contemplated by this Agreement or of
the Tender Offers.
(xx) Possession of Licenses and Permits. The Company and its
Subsidiaries possess such permits, licenses, approvals, consents and
other authorizations (collectively, "Governmental Licenses") issued by
the appropriate federal, state, local or foreign regulatory agencies or
bodies necessary to conduct the business now operated by them; the
Company and its Subsidiaries are in compliance with the terms and
conditions of all such Governmental Licenses, except where the failure
so to comply would not, singly or in the aggregate, have a Material
Adverse Effect; all of the Governmental Licenses are valid and in full
force and effect, except when the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full
force and effect would not have a Material Adverse Effect; and neither
the Company nor any of its Subsidiaries has received any notice of
proceedings relating to the revocation or modification of any such
Governmental Licenses which, singly or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, would result in a
Material Adverse Effect.
(xxi) Title to Property. The Company and its Subsidiaries have
good and marketable title to all real property owned by the Company and
its Subsidiaries and good title to all other properties owned by them,
in each case, free and clear of all mortgages, pledges, liens, security
interests, claims, restrictions or encumbrances of any kind except such
as (a) are described in the Offering Memorandum or (b) do not, singly
or in the
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aggregate, materially affect the value of such property and do not
interfere with the use made and proposed to be made of such property by
the Company or any of its Subsidiaries; and all of the leases and
subleases material to the business of the Company and its Subsidiaries,
considered as one enterprise, and under which the Company or any of its
Subsidiaries holds properties described in the Offering Memorandum, are
in full force and effect, and neither the Company nor any of its
Subsidiaries has any notice of any material claim of any sort that has
been asserted by anyone adverse to the rights of the Company or any of
its subsidiaries under any of the leases or subleases mentioned above,
or affecting or questioning the rights of the Company or such
Subsidiary to the continued possession of the leased or subleased
premises under any such lease or sublease.
(xxii) Environmental Laws. Except as described in the Offering
Memorandum and except such matters as would not, singly or in the
aggregate, result in a Material Adverse Effect, to the best of the
Company's knowledge, (A) neither the Company nor any of its
Subsidiaries is in violation of any statute, law, rule, regulation,
ordinance, code, policy or rule of common law or any judicial or
administrative interpretation thereof, including any judicial or
administrative order, consent, decree or judgment, relating to
pollution or protection of human health, the environment (including,
without limitation, ambient air, surface water, groundwater, land
surface or subsurface strata) or wildlife, including, without
limitation, laws and regulations relating to the release or threatened
release of chemicals, pollutants, contaminants, wastes, toxic
substances, hazardous substances, petroleum or petroleum products
(collectively, "Hazardous Materials") or to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport
or handling of Hazardous Materials (collectively, "Environmental
Laws"), (B) the Company and its Subsidiaries have all permits,
authorizations and approvals required under any applicable
Environmental Laws and are each in compliance with their requirements,
(C) there are no pending or threatened administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens,
notices of noncompliance or violation, investigation or proceedings
relating to any Environmental Law against the Company or any of its
Subsidiaries and (D) there are no events or circumstances that might
reasonably be expected to form the basis of an order for clean-up or
remediation, or an action, suit or proceeding by any private party or
governmental body or agency, against or affecting the Company or any of
its Subsidiaries relating to Hazardous Materials or the violation of
any Environmental Laws.
(xxiii) Material Contracts. Except for the contracts listed as
Exhibit 10 to the Company's Annual Report on Form 10-K for the fiscal
year ended December 28, 1996, and the contracts disclosed in the
Offering Memorandum, neither the Company, ▇▇▇▇▇ ▇▇▇▇ Foods, Inc. nor
any of their Subsidiaries is party to any contract, agreement or
understanding that is material to the business of the Company or its
Subsidiaries, considered as one enterprise.
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(xxiv) Tax Returns. All United States federal income tax returns
of the Company and its Subsidiaries required by law to be filed have
been filed or an extension has been duly received in respect thereof
and all taxes shown by such returns or otherwise assessed, which are
due and payable, have been paid, except taxes or charges that are being
contested in good faith or assessments against which appeals have been
or will be promptly taken and as to which adequate reserves have been
provided and except where the nonpayment of which would not have a
Material Adverse Effect. The United States federal income tax returns
of the Company through the fiscal year ended December 31, 1994 have
been settled and no assessment in connection therewith has been made
against the Company. The Company and its Subsidiaries have filed all
other tax returns that are required to have been filed by them pursuant
to applicable foreign, state, local or other law except insofar as the
failure to file such returns would not result in a Material Adverse
Effect, and have paid all taxes due pursuant to such returns or
pursuant to any assessment received by the Company and its
Subsidiaries, except for such taxes or charges that are being contested
in good faith or assessments against which appeals have been or will
promptly be taken and as to which adequate reserves have been provided
and other than those the nonpayment of which would not have a Material
Adverse Effect. The charges, accruals and reserves on the books of the
Company in respect of any income and corporation tax liability for any
years not finally determined are adequate to meet any assessments or
reassessments for additional income tax for any years not finally
determined, except to the extent of any inadequacy that would not
result in a Material Adverse Effect.
(xxv) Internal. The Company and its Subsidiaries maintain a
system of internal accounting controls sufficient to provide reasonable
assurances that (A) transactions are executed in accordance with
management's general or specific authorization, (B) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain accountability for assets, (C) access to assets is permitted
only in accordance with management's general or specific authorization
and (D) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is taken
with respect to any differences.
(xxvi) Insurance. The Company and its Subsidiaries carry or are
entitled to the benefits of insurance, with financially sound and
reputable insurers, in such amounts and covering such risks as is
prudent and customary in the business in which it is engaged.
(xxvii) Solvency. The Company is, and immediately after the
Closing Time will be, Solvent. As used herein, the term "Solvent"
means, with respect to the Company on a particular date, that on such
date (A) the fair salable value of the assets of the Company is greater
than the stated value of liabilities (including contingent liabilities)
of the Company, (B) the Company will be able to pay its stated
liabilities, including contingent obligations, as they mature, and (C)
the Company will not have an
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unreasonably small amount of capital for the operation of the business
in which it is engaged.
(xxviii) Stabilization. Neither the Company nor any of its
officers, directors or controlling persons has taken, directly or
indirectly, any action designed to cause or to result in, or that has
constituted or which might reasonably be expected to constitute, the
stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Securities.
(xxix) Suppliers. Except as disclosed in the Offering
Memorandum, no supplier to the Company or any of its Subsidiaries has
ceased shipments of merchandise to the Company, other than in the
normal and ordinary course of business consistent with past practices,
or where such cessation would not result in a Material Adverse Effect.
(xxx) Investment Company Act. The Company is not, and upon the
issuance and sale of the Securities as herein contemplated and the
application of the net proceeds therefrom as described in the Offering
Memorandum will not be, an "investment company" or an entity
"controlled" by an "investment company" as such terms are defined in
the Investment Company Act of 1940, as amended (the "1940 Act").
(xxxi) Rule 144A Eligibility. The Securities are eligible for
resale pursuant to Rule 144A and will not be, at the Closing Time, of
the same class as securities listed on a national securities exchange
registered under Section 6 of the 1934 Act, or quoted in a U.S.
automated interdealer quotation system.
(xxxii) No General Solicitation. None of the Company, its
affiliates, as such term is defined in Rule 501(b) under the 1933 Act
("Affiliates"), or any person acting on its or any of their behalf
(other than the Initial Purchasers, as to whom the Company makes no
representation) has engaged or will engage, in connection with the
offering of the Securities, in any form of general solicitation or
general advertising within the meaning of Rule 502(c) under the 1933
Act.
(xxxiii) No Registration Required. Subject to compliance by the
Initial Purchasers with the representations and warranties set forth in
Section 2 and the procedures set forth in Section 6 hereof, it is not
necessary in connection with the offer, sale and delivery of the
Securities to the Initial Purchasers and to each Subsequent Purchaser
in the manner contemplated by this Agreement and the Offering
Memorandum to register the Securities under the 1933 Act or to qualify
the Indenture under the Trust Indenture Act of 1939, as amended (the
"1939 Act").
(xxxiv) No Directed Selling Efforts. With respect to those
Securities sold in reliance on Regulation S, (A) none of the Company,
its Affiliates or any person acting on its or their behalf (other than
the Initial Purchasers, as to whom the Company makes no representation)
has engaged or will engage in any directed selling efforts within the
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meaning of Regulation S and (B) each of the Company and its Affiliates
and any person acting on its or their behalf (other than the Initial
Purchasers, as to whom the Company makes no representation) has
complied and will comply with the offering restrictions requirement of
Regulation S.
(b) Officer's Certificates. Any certificate signed by any officer of
the Company delivered to the Representative or to counsel for the Initial
Purchasers shall be deemed a representation and warranty by the Company to each
Initial Purchaser as to the matters covered thereby.
SECTION 2. Sale and Delivery to Initial Purchasers; Closing.
(a) Securities. On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Company agrees to sell to each Initial Purchaser, severally and not jointly, and
each Initial Purchaser, severally and not jointly, agrees to purchase from the
Company, at the price set forth in Schedule B, the aggregate principal amount of
Securities set forth in Schedule A opposite the name of such Initial Purchaser,
plus any additional principal amount of Securities which such Initial Purchaser
may become obligated to purchase pursuant to the provisions of Section 11
hereof.
(b) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the office of ▇▇▇▇▇.
▇▇▇▇▇ & ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or at such other place
as shall be agreed upon by the Representative and the Company, at 10:00 A.M.
(Eastern Time) on the fifth business day after the date hereof (unless postponed
in accordance with the provisions of Section 11), or such other time not later
than ten business days after such date as shall be agreed upon by the
Representative and the Company (such time and date of payment and delivery being
herein called the "Closing Time").
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
the Representative for the respective accounts of the Initial Purchasers of
certificates for the Securities to be purchased by them. It is understood that
each Initial Purchaser has authorized the Representative, for its account, to
accept delivery of, receipt for, and make payment of the purchase price for, the
Securities which it has agreed to purchase. ▇▇▇▇▇▇▇ ▇▇▇▇▇, individually and not
as representative of the Initial Purchasers, may (but shall not be obligated to)
make payment of the purchase price for the Securities to be purchased by any
Initial Purchaser whose funds have not been received by the Closing Time, but
such payment shall not relieve such Initial Purchaser from its obligations
hereunder. The certificates representing the Securities shall be registered in
the name of Cede & Co. pursuant to the DTC Agreement and shall be made available
for examination and packaging by the Initial Purchasers in The City of New York
not later than 10:00 A.M. (Eastern Time) on the last business day prior to the
Closing Time.
(c) Qualified Institutional Buyer. Each Initial Purchaser severally
and not jointly represents and warrants to, and agrees with, the Company that it
is a "qualified institutional
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buyer" within the meaning of Rule 144A under the 1933 Act (a "Qualified
Institutional Buyer") and an "accredited investor" within the meaning of Rule
501(a) under the 1933 Act (an "Accredited Investor").
(d) Denominations; Registration. Certificates for the Securities shall
be in such denominations ($1,000 or integral multiples thereof) and registered
in such names as the Representative may request in writing at least one full
business day before the Closing Time.
SECTION 3. Covenants of the Company. The Company covenants with each
Initial Purchaser as follows:
(a) Offering Memorandum. The Company, as promptly as possible, will
furnish to each Initial Purchaser, without charge, such number of copies of the
Preliminary Offering Memorandum, the Final Offering Memorandum and any
amendments and supplements thereto and documents incorporated by reference
therein as such Initial Purchaser may reasonably request.
(b) Notice and Effect of Material Events. The Company will immediately
notify each Initial Purchaser, and confirm such notice in writing, of (x) any
filing made by the Company of information relating to the offering of the
Securities with any securities exchange or any other regulatory body in the
United States or any other jurisdiction, and (y) prior to the completion of the
placement of the Securities by the Initial Purchasers as evidenced by a notice
in writing from the Initial Purchasers to the Company, any material changes in
or affecting the earnings, business affairs or business prospects of the Company
and its Subsidiaries which (i) make any statement in the Offering Memorandum
false or misleading or (ii) are not disclosed in the Offering Memorandum. In
such event or if during such time any event shall occur as a result of which it
is necessary, in the reasonable opinion of the Company, its counsel, the Initial
Purchasers or counsel for the Initial Purchasers, to amend or supplement the
Final Offering Memorandum in order that the Final Offering Memorandum not
include any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein not misleading in the light of
the circumstances then existing, the Company will forthwith amend or supplement
the Final Offering Memorandum by preparing and furnishing to each Initial
Purchaser an amendment or amendments of, or a supplement or supplements to, the
Final Offering Memorandum (in form and substance satisfactory in the reasonable
opinion of counsel for the Initial Purchasers) so that, as so amended or
supplemented, the Final Offering Memorandum will not include an untrue statement
of a material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances existing at the time
it is delivered to a Subsequent Purchaser, not misleading.
(c) Amendment to Offering Memorandum and Supplements. The Company will
advise each Initial Purchaser promptly of any proposal to amend or supplement
the Offering Memorandum and will not effect such amendment or supplement without
the consent of the Initial Purchasers, provided that the Initial Purchasers
shall object by written notice to the Company within three business days after
receipt of a copy of any such proposed amendment
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or supplement. Neither the consent of the Initial Purchasers, nor the Initial
Purchaser's delivery of any such amendment or supplement, shall constitute a
waiver of any of the conditions set forth in Section 5 hereof.
(d) Qualification of Securities for Offer and Sale. The Company will
use its reasonable best efforts, in cooperation with the Initial Purchasers, to
qualify the Securities for offering and sale under the applicable securities
laws of such jurisdictions as the Representative may designate and will maintain
such qualifications in effect as long as required for the sale of the
Securities; provided, however, that the Company shall not be obligated to file
any general consent to service of process or to qualify as a foreign corporation
or as a dealer in securities in any jurisdiction in which it is not so qualified
or to subject itself to taxation in respect of doing business in any
jurisdiction in which it is not otherwise so subject.
(e) Rating of Securities. The Company shall take all reasonable action
necessary to enable Standard & Poor's Ratings Group ("S&P"), a division of
McGraw Hill, Inc. and ▇▇▇▇▇'▇ Investors Service, Inc. ("Moody's") to provide
their respective credit ratings of the Securities.
(f) DTC and PORTAL. The Company will cooperate with the Representative
and use its best efforts to (i) permit the Securities to be eligible for
clearance and settlement through the facilities of DTC and (ii) include
quotation of the Securities on the Private Offerings, Resales and Trading
through Automatic Linkages (PORTAL) System of The National Association of
Securities Dealers, Inc.
(g) Use of Proceeds. The Company will use the net proceeds received by
it from the sale of the Securities in the manner specified in the Offering
Memorandum under "Use of Proceeds."
(h) Restriction on Sale of Securities. During a period of 180 days
from the date of the Offering Memorandum, the Company will not, without the
prior written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇, directly or indirectly, issue, sell,
offer or agree to sell, grant any option for the sale of, or otherwise dispose
of, any other debt securities of the Company or securities of the Company that
are convertible into, or exchangeable for, the Securities or such other debt
securities, other than the Exchange Notes referred to in the Registration Rights
Agreement.
SECTION 4. Payment of Expenses.
(a) Expenses. The Company will pay all expenses incident to the
performance of its obligations under this Agreement, including (i) the
preparation, printing and any filing of the Offering Memorandum (including
financial statements) and of each amendment or supplement thereto, (ii) the
preparation, printing and delivery to the Initial Purchasers of this Agreement,
any Agreement among Initial Purchasers, the Indenture and such other documents
as may be required in connection with the offering, purchase, sale and delivery
of the Securities, (iii) the preparation, issuance and delivery of the
certificates for the Securities to the Initial Purchasers,
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including any charges of DTC in connection therewith, (iv) the fees and
disbursements of the Company's counsel, accountants and other advisors, (v) the
qualification of the Securities under securities laws in accordance with the
provisions of Section 3(d) hereof, including filing fees and the reasonable fees
and disbursements of counsel for the Initial Purchasers in connection therewith
and in connection with the preparation of the Blue Sky Survey, any supplement
thereto and any Legal Investment Survey, (vi) the reasonable fees and expenses
of the Trustee, including the reasonable fees and disbursements of counsel for
the Trustee in connection with the Indenture and the Securities, (vii) any fees
payable in connection with the rating of the Securities, and (viii) any fees
payable to the National Association of Securities Dealers, Inc. (the "NASD") in
connection with the initial and continued designation of the Securities as
PORTAL securities under the PORTAL Market Rules pursuant to NASD Rule 5322.
(b) Termination of Agreement. If this Agreement is terminated by the
Representative in accordance with the provisions of Section 5(j) or Section
10(a)(i) hereof, the Company shall reimburse the Initial Purchasers for all of
their documented out-of-pocket expenses, including the reasonable fees and
disbursements of counsel for the Initial Purchasers. The Company shall not in
any event be liable to the Initial Purchasers for the loss of anticipated
profits from the transactions contemplated by this Agreement.
SECTION 5. Conditions of Initial Purchasers' Obligations. The
obligations of the several Initial Purchasers hereunder are subject to the
accuracy of the representations and warranties of the Company contained in
Section 1 hereof or in certificates of any officer of the Company delivered
pursuant to the provisions hereof, to the performance by the Company of its
covenants and other obligations hereunder, and to the following further
conditions:
(a) Opinion of Counsel for Company. At the Closing Time, the
Representative shall have received the favorable opinion, dated as of the
Closing Time, of ▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, counsel for the Company, in form
and substance satisfactory to ▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇ to the effect set forth in
Exhibit A hereto and to such further effect as ▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇ may
reasonably request. It is understood that the opinions set forth in paragraph
(i) of Exhibit A (as to due incorporation), paragraph (iii) of Exhibit A, and
paragraph (v) of Exhibit A may be delivered by ▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq., on behalf of
the Company rather than by ▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP.
(b) Opinion of Counsel for Initial Purchasers. At the Closing Time,
the Initial Purchasers shall have received the favorable opinion, dated as of
the Closing Time, of ▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇, counsel for the Initial Purchasers,
with respect to the matters set forth in paragraphs (i), (ii), and (vi) through
(x), inclusive, and the last paragraph, of Exhibit A hereto. Such counsel may
also state that, insofar as such opinion involves factual matters, they have
relied, to the extent they deem proper, upon certificates of officers of the
Company and certificates of public officials.
(c) Officers' Certificate. At the Closing Time, there shall not have
been, since the date hereof or since the respective dates as of which
information is given in the Offering
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Memorandum, any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Company and its Subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, and the Representative shall have
received a certificate of the President or a Vice President of the Company and
of the chief financial or chief accounting officer of the Company, dated as of
the Closing Time, to the effect that (i) there has been no such material adverse
change, (ii) the representations and warranties in Section 1(a) hereof are true
and correct with the same force and effect as though expressly made at and as of
the Closing Time, and (iii) the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied at or prior to
the Closing Time.
(d) Accountant's Comfort Letter. At the time of the execution of this
Agreement, the Representative shall have received from Deloitte & Touche L.L.P.
a letter dated such date, in form and substance satisfactory to the
Representative, together with signed or reproduced copies of such letter for
each of the other Initial Purchaser, containing statements and information of
the type ordinarily included in accountants' "comfort letters" to Initial
Purchasers with respect to the financial statements and certain financial
information contained in the Offering Memorandum.
(e) Bring-down Comfort Letter. At the Closing Time, the Representative
shall have received from Deloitte & Touche LLP a letter, dated as of the Closing
Time, to the effect that they reaffirm the statements made in the letter
furnished pursuant to subsection (d) of this Section, except that the specified
date referred to shall be a date not more than three business days prior to the
Closing Time.
(f) Maintenance of Rating. At the Closing Time, the Securities shall be
rated at least "B3" by Moody's Investor's Service Inc. and "B" by Standard &
Poor's Corporation, and the Company shall have delivered to the Representative a
letter dated the Closing Time, from each such rating agency, or other evidence
satisfactory to the Representative, confirming that the Securities have such
ratings; and since the date of this Agreement, there shall not have occurred a
downgrading in the rating assigned to the Securities or any of the Company's
other debt securities by any nationally recognized securities rating agency, and
no such securities rating agency shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating of the
Securities or any of the Company's other debt securities.
(g) PORTAL. At the Closing Time, (A) the Securities shall have been
designated for trading on PORTAL and (B) Securities issued pursuant to Rule 144A
in book entry form shall have been accepted for settlement through the
facilities of DTC.
(h) Refinancing. At the Closing Time, (i) the Company shall have
consummated the Company Tender Offer (as defined in the Offering Memorandum),
(ii) ▇▇▇▇▇ ▇▇▇▇ shall have consummated the ▇▇▇▇▇ ▇▇▇▇ Tender Offer (as defined
in the Offering Memorandum), (iii) the Company shall have duly and validly
entered into a supplemental indenture with respect to the 12% Notes (as defined
in the Offering Memorandum), pursuant to which the consummation of
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the transactions contemplated by this Agreement and the other transactions
constituting the Refinancing shall be permissible, (iv) ▇▇▇▇▇ ▇▇▇▇ shall have
duly and validly entered into a supplemental indenture with respect to the 12
3/4% Discount Notes (as defined in the Offering Memorandum), pursuant to which
the consummation of the transactions contemplated by this Agreement and the
other transactions constituting the Refinancing shall be permissible, and (v)
the Company and ▇▇▇▇▇ ▇▇▇▇ shall have consummated all other transactions
comprising the Refinancing which, as described in the Offering Memorandum under
the caption "Refinancing," are intended to occur at or prior to the Closing
Time.
(i) Additional Documents. At the Closing Time, counsel for the Initial
Purchasers shall have been furnished with such documents and opinions as they
may reasonably require for the purpose of enabling them to pass upon the
issuance and sale of the Securities as herein contemplated, or in order to
evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company in connection with the issuance and sale of the Securities
as herein contemplated shall be satisfactory in form and substance to the
Representative and counsel for the Initial Purchasers.
(j) Termination of Agreement. If any condition specified in this
Section shall not have been fulfilled when and as required to be fulfilled, this
Agreement may be terminated by the Representative by notice to the Company at
any time at or prior to the Closing Time, and such termination shall be without
liability of any party to any other party except as provided in Section 4 and
except that Sections 7 and 8 shall survive any such termination and remain in
full force and effect.
SECTION 6. Subsequent Offers and Resales of the Securities.
(a) Offer and Sale Procedures. Each of the Initial Purchasers and the
Company hereby establish and agree to observe the following procedures in
connection with the offer and sale of the Securities:
(i) Offers and Sales only to Institutional Accredited Investors
or Qualified Institutional Buyers. Offers and sales of the Securities
will be made only by the Initial Purchasers or Affiliates thereof
qualified to do so in the jurisdictions in which such offers or sales
are made. Each such offer or sale shall only be made (A) to persons
whom the offeror or seller reasonably believes to be qualified
institutional buyers (as defined in Rule 144A under the 1933 Act, (B)
to a limited number of other institutional accredited investors (as
such term is defined in Rule 501(a)(1), (2), (3) or (7) of Regulation
D) that the offeror or seller reasonably believes to be and, with
respect to sales and deliveries, that are Accredited Investors
("Institutional Accredited Investors"), or (C) to non-U.S. persons
outside the United States to whom the offeror or seller reasonably
believes offers and sales of the Securities may be made in reliance
upon Regulation S under the 1933 Act.
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(ii) No General Solicitation. The Securities will be offered by
the Initial Purchasers only by approaching prospective Subsequent
Purchasers on an individual basis. No general solicitation or general
advertising (within the meaning of Rule 502(c) under the ▇▇▇▇ ▇▇▇) will
be used in the United States in connection with the offering of the
Securities.
(iii) Purchases by Non-Bank Fiduciaries. In the case of a
non-bank Subsequent Purchaser of a Security acting as a fiduciary for
one or more third parties, in connection with an offer and sale to such
purchaser pursuant to clause (a) above, each third party shall, in the
judgment of the applicable Initial Purchaser, be an Institutional
Accredited Investor or a Qualified Institutional Buyer or a non-U.S.
person outside the United States.
(iv) Subsequent Purchaser Notification. Each Initial Purchaser
will take reasonable steps to inform, and cause each of its U.S.
Affiliates to take reasonable steps to inform, persons acquiring
Securities from such Initial Purchaser or affiliate, as the case may
be, in the United States that the Securities (A) have not been and will
not be registered under the 1933 Act, (B) are being sold to them
without registration under the 1933 Act in reliance on Rule 144A or in
accordance with another exemption from registration under the 1933 Act,
as the case may be, and (C) may not be offered, sold or otherwise
transferred except (1) to the Company or any of its Subsidiaries, (2)
outside the United States in accordance with Rule 904 of Regulation S,
or (3) inside the United States in accordance with (x) Rule 144A to a
person whom the seller reasonably believes is a Qualified Institutional
Buyer that is purchasing such Securities for its own account or for the
account of a Qualified Institutional Buyer to whom notice is given that
the offer, sale or transfer is being made in reliance on Rule 144A or
(y) the exemption from registration provided by Rule 144 under the 1933
Act, if available.
(v) Minimum Principal Amount. No sale of the Securities to any
one Subsequent Purchaser will be for less than U.S. $150,000 principal
amount and no Security will be issued in a smaller principal amount. If
the Subsequent Purchaser is a non-bank fiduciary acting on behalf of
others, each person for whom it is acting must purchase at least U.S.
$150,000 principal amount of the Securities.
(vi) Restrictions on Transfer. The transfer restrictions and the
other provisions set forth in Section 311 of the Indenture, including
the legend required thereby, shall apply to the Securities except as
otherwise agreed by the Company and the Initial Purchasers. Following
the sale of the Securities by the Initial Purchasers to Subsequent
Purchasers pursuant to the terms hereof, the Initial Purchasers shall
not be liable or responsible to the Company for any losses, damages or
liabilities suffered or incurred by the Company, including any losses,
damages or liabilities under the 1933 Act, arising from or relating to
any resale or transfer of any Security.
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(vii) Delivery of Offering Memorandum. Each Initial Purchaser
will deliver to each purchaser of the Securities from such Initial
Purchaser, in connection with its original distribution of the
Securities, a copy of the Offering Memorandum, as amended and
supplemented at the date of such delivery.
(b) Covenants of the Company. The Company covenants with each Initial
Purchaser as follows:
(i) Due Diligence. In connection with the original distribution
of the Securities, the Company agrees that, prior to any offer or
resale of the Securities by the Initial Purchasers, the Initial
Purchasers and counsel for the Initial Purchasers shall have the right
to make reasonable inquiries into the business of the Company and its
Subsidiaries. The Company also agrees to provide answers to each
prospective Subsequent Purchaser of Securities who so requests
concerning the Company and its Subsidiaries (to the extent that such
information is available or can be acquired and made available to
prospective Subsequent Purchasers without unreasonable effort or
expense and to the extent the provision thereof is not prohibited by
applicable law) and the terms and conditions of the offering of the
Securities, as provided in the Offering Memorandum.
(ii) Integration. The Company agrees that it will not and will
cause its Affiliates not to make any offer or sale of securities of the
Company of any class if, as a result of the doctrine of "integration"
referred to in Rule 502 under the 1933 Act, such offer or sale would
render invalid (for the purpose of (i) the sale of the Securities by
the Company to the Initial Purchasers, (ii) the resale of the
Securities by the Initial Purchasers to Subsequent Purchasers or (iii)
the resale of the Securities by such Subsequent Purchasers to others)
the exemption from the registration requirements of the 1933 Act
provided by Section 4(2) thereof or by Rule 144A or by Regulation S
thereunder or otherwise.
(iii) Rule 144A Information. The Company agrees that, in order to
render the Securities eligible for resale pursuant to Rule 144A under
the 1933 Act, while any of the Securities remain outstanding, it will
make available, upon request, to any holder of Securities or
prospective purchasers of Securities the information specified in Rule
144A(d)(4), unless the Company furnishes information to the Commission
pursuant to Section 13 or 15(d) of the 1934 Act (such information,
whether made available to holders or prospective purchasers or
furnished to the Commission, is herein referred to as "Additional
Information").
(iv) Restriction on Repurchases. Until the expiration of two
years after the original issuance of the Securities, the Company will
not, and will cause its Affiliates not to, purchase or agree to
purchase or otherwise acquire any Securities which are "restricted
securities" (as such term is defined under Rule 144(a)(3) under the
1933 Act), whether as beneficial owner or otherwise (except as agent
acting as a securities broker
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on behalf of and for the account of customers in the ordinary course of
business in unsolicited broker's transactions) unless, immediately upon
any such purchase, the Company or any Affiliate shall submit such
Securities to the Trustee for cancellation.
(c) Resale Pursuant to Rule 903 of Regulation S or Rule 144A. Each
Initial Purchaser understands that the Securities have not been and will not be
registered under the 1933 Act and may not be offered or sold within the United
States or to, or for the account or benefit of, U.S. persons except in
accordance with Regulation S under the 1933 Act or pursuant to an exemption from
the registration requirements of the 1933 Act. Each Initial Purchaser represents
and agrees that, in connection with sales of securities outside of the United
States, except as permitted by Section 6(a) above, it has offered and sold
Securities and will offer and sell Securities (i) as part of its distribution at
any time and (ii) otherwise until forty days after the later of the date upon
which the offering of the Securities commences and the Closing Time, only in
accordance with Rule 903 of Regulation S or Rule 144A under the 1933 Act.
Accordingly, neither the Initial Purchasers, their affiliates nor any persons
acting on their behalf have engaged or will engage in any directed selling
efforts with respect to Securities, and the Initial Purchasers, their affiliates
and any person acting on their behalf have complied and will comply with the
offering restriction requirements of Regulation S. Each Initial Purchaser agrees
that, at or prior to confirmation of a sale of Securities outside of the United
States (other than a sale of Securities pursuant to Rule 144A), it will have
sent to each distributor, dealer or person receiving a selling concession, fee
or other remuneration that purchases Securities from it or through it during the
restricted period a confirmation or notice to substantially the following
effect:
"The Securities covered hereby have not been registered under the
United States Securities Act of 1933 (the "Securities Act") and may not
be offered or sold within the United States or to or for the account or
benefit of U.S. persons (i) as part of their distribution at any time
and (ii) otherwise until forty days after the later of the date upon
which the offering of the Securities commenced and the date of closing,
except in either case in accordance with Regulation S or Rule 144A
under the Securities Act. Terms used above have the meaning given to
them by Regulation S."
Terms used in the above paragraph have the meanings given to them by Regulation
S.
Each Initial Purchaser severally represents and agrees that it has not entered
and will not enter into any contractual arrangements with respect to the
distribution of the Securities, except with its affiliates or with the prior
written consent of the Company.
SECTION 7. Indemnification.
(a) Indemnification of Initial Purchasers. 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 1933 Act
or Section 20 of the 1934 Act as follows:
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(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in any
Preliminary Offering Memorandum or the Final Offering Memorandum (or
any amendment or supplement thereto), or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or of any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission; provided
that (subject to Section 7(d) below) any such settlement is effected
with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by ▇▇▇▇▇▇▇
▇▇▇▇▇), reasonably incurred in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Initial Purchaser through ▇▇▇▇▇▇▇ ▇▇▇▇▇ expressly for use in any Preliminary
Offering Memorandum or the Offering Memorandum (or any amendment or supplement
thereto) shall not inure to the benefit of any Initial Purchaser (or to the
benefit of any person controlling such Initial Purchaser) from whom the person
asserting any such losses, liabilities, claims, damages or expenses purchased
Securities if such untrue statement or omission or alleged untrue statement or
omission made in any Preliminary Offering Memorandum or the Offering Memorandum
(or any amendment or supplement thereto) is identified in writing at such time
to such Initial Purchaser and is eliminated or remedied in the Offering
Memorandum as most recently amended or supplemented (copies of such amendments
and supplements having been delivered to such Initial Purchaser in sufficient
quantity at least three business days prior to the written confirmation of the
sale of such Securities to such person) and it shall be established that a copy
of the Offering Memorandum as most recently amended or supplemented had not been
furnished to such person at or prior to the written confirmation of the sale of
such Securities to such person.
(b) Indemnification of Company, Directors and Officers. The Initial
Purchasers severally agree to indemnify and hold harmless the Company, its
directors, each of its officers and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act against any and all loss, liability, claim, damage and
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26
expense described in the indemnity contained in subsection (a) of this Section,
as incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Offering Memorandum in reliance upon
and in conformity with written information furnished to the Company by the
Initial Purchasers expressly for use in the Offering Memorandum.
(c) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 7(a) above,
counsel to the indemnified parties shall be selected by ▇▇▇▇▇▇▇ ▇▇▇▇▇, and, in
the case of parties indemnified pursuant to Section 7(b) above, counsel to the
indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 7 or Section
8 hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 7(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
SECTION 8. Contribution. If the indemnification provided for in Section
7 hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of
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any losses, liabilities, claims, damages or expenses referred to therein, then
each indemnifying party shall contribute to the aggregate amount of such losses,
liabilities, claims, damages and expenses incurred by such indemnified party, as
incurred, (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Initial Purchasers on
the other hand from the offering of the Securities pursuant to this Agreement or
(ii) if the allocation provided by clause (i) is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the
Company on the one hand and of the Initial Purchasers on the other hand in
connection with the statements or omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company on the one hand and the
Initial Purchasers on the other hand in connection with the offering of the
Securities pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total proceeds from the offering of the Securities
pursuant to this Agreement (before deducting expenses) received by the Company
and the total underwriting discount received by the Initial Purchasers, bear to
the aggregate initial offering price to investors of the Securities as set forth
on the cover page of the Offering Memorandum.
The relative fault of the Company on the one hand and the Initial
Purchasers on the other hand shall be determined by reference to, among other
things, whether any such untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Initial Purchasers and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
The Company and the Initial Purchasers agree that it would not be just
and equitable if contribution pursuant to this Section 8 were determined by pro
rata allocation (even if the Initial Purchasers were treated as one entity for
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above in this Section 8. The
aggregate amount of losses, liabilities, claims, damages and expenses incurred
by an indemnified party and referred to above in this Section 8 shall be deemed
to include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 8, no Initial Purchaser
shall be required to contribute any amount in excess of the amount by which the
total price at which the Securities underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
Initial Purchaser has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission.
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No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the ▇▇▇▇ ▇▇▇) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 8, each person, if any, who controls an
Initial Purchaser within the meaning of Section 15 of the 1933 Act or Section 20
of the 1934 Act shall have the same rights to contribution as such Initial
Purchaser, and each director of the Company, each officer of the Company and
each person, if any, who controls the Company within the meaning of Section 15
of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to
contribution as the Company. The Initial Purchasers' respective obligations to
contribute pursuant to this Section 8 are several in proportion to the principal
amount of Securities set forth opposite their respective names in Schedule A
hereto and not joint.
SECTION 9. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company submitted pursuant
hereto, shall remain operative and in full force and effect, regardless of any
investigation made by or on behalf of any Initial Purchaser or controlling
person, or by or on behalf of the Company, and shall survive delivery of the
Securities to the Initial Purchasers.
SECTION 10. Termination of Agreement.
(a) Termination; General. The Representative may terminate this
Agreement, by notice to the Company, at any time at or prior to the Closing Time
(i) if there has been, since the time of execution of this Agreement or since
the respective dates as of which information is given in the Offering
Memorandum, any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Company and its Subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, or (ii) if there has occurred any
material adverse change in the financial markets in the United States, any
outbreak of hostilities or escalation thereof or other calamity or crisis or any
change or development involving a prospective change in national or
international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the judgment of the Representative,
impracticable to market the Securities or to enforce contracts for the sale of
the Securities, or (iii) if trading in any securities of the Company has been
suspended or limited by the Commission or if trading generally on the American
Stock Exchange or The New York Stock Exchange, Inc. or in the NASDAQ National
Market System has been suspended or limited, or minimum or maximum prices for
trading have been fixed, or maximum ranges for prices have been required, by any
of said exchanges or by such system or by order of the Commission, the National
Association of Securities Dealers, Inc. or any other governmental authority, or
(iv) if a banking moratorium has been declared by either United States Federal
or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in
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Section 4 hereof, and provided further that Sections 1, 7 and 8 shall survive
such termination and remain in full force and effect.
SECTION 11. Default by One of the Initial Purchasers. If one of the
Initial Purchasers shall fail at the Closing Time to purchase the Securities
which it is obligated to purchase under this Agreement (the "Defaulted
Securities"), the Representative shall have the right, but not the obligation,
within 24 hours thereafter, to make arrangements for the non-defaulting Initial
Purchaser, or any other Initial Purchasers, to purchase all, but not less than
all, of the Defaulted Securities in such amounts as may be agreed upon and upon
the terms herein set forth; if, however, the Representative shall not have
completed such arrangements within such 24-hour period, then this Agreement
shall terminate without liability on the part of any non-defaulting Initial
Purchaser.
No action pursuant to this Section shall relieve any defaulting Initial
Purchaser from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement, either the Representative or the Company shall have the right
to postpone the Closing Time for a period not exceeding seven days in order to
effect any required changes in the Offering Memorandum or in any other documents
or arrangement. As used herein, the term Initial Purchaser includes any person
substituted for an Initial Purchaser under this Section 11.
SECTION 12. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the Initial
Purchasers shall be directed to the Representative at North Tower, World
Financial Center, New York, New York 10281-1201, attention of ▇▇▇ ▇▇▇▇▇▇▇▇;
notices to the Company shall be directed to it at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇, attention of Chief Financial Officer with a copy to
▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇, L.L.P., ▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇,
Attention: N. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇.
SECTION 13. Parties. This Agreement shall each inure to the benefit of
and be binding upon the Initial Purchasers and the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
Initial Purchasers and the Company and their respective successors and the
controlling persons and officers and directors referred to in Sections 7 and 8
and their heirs and legal representatives, any legal or equitable right, remedy
or claim under or in respect of this Agreement or any provision herein
contained. This Agreement and all conditions and provisions hereof are intended
to be for the sole and exclusive benefit of the Initial Purchasers and the
Company and their respective successors, and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Securities from
any Initial Purchaser shall be deemed to be a successor by reason merely of such
purchase.
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SECTION 14. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. EXCEPT AS
OTHERWISE SET FORTH HEREIN, SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 15. Effect of Headings. The Article and Section headings herein
and the Table of Contents are for convenience only and shall not affect the
construction hereof.
SECTION 16. Counterparts. This Agreement may be executed in one or more
counterparts and when a counterpart has been executed by each party, all such
counterparts taken together shall constitute one and the same agreement.
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If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
between the Initial Purchasers and the Company in accordance with its terms.
Very truly yours,
DI GIORGIO CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
--------------------------------
Title: Executive Vice President
and Chief Financial
Officer
CONFIRMED AND ACCEPTED,
as of the date first above written:
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
BT SECURITIES CORPORATION
By: ▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
By: /s/ Pascal Maeter
--------------------------------------------
Authorized Signatory
For itself and as Representative of the Initial Purchasers named in Schedule A
hereto.
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SCHEDULE A
Principal
Amount of
Name of Initial Purchaser Securities
------------------------- ----------
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated................................ $124,000,000
BT Securities Corporation............................... 31,000,000
------------
Total................................................... $155,000,000
============
Sch A - 1
33
SCHEDULE B
DI GIORGIO CORPORATION
$155,000,000 Senior Notes due 2007
1. The initial public offering price of the Securities shall be 100%
of the principal amount thereof, plus accrued interest, if any, from the date of
issuance.
2. The purchase price to be paid by the Initial Purchasers for the
Securities shall be 97% of the principal amount thereof.
3. The interest rate on the Securities shall be 10% per annum.
4. The Company may redeem up to 35% of the originally issued Notes, at
a price of 110% of the principal amount thereof.
5. The Securities shall mature on June 15, 2007.
Sch B - 1
34
Exhibit A
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
(i) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Delaware.
(ii) The Company has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the Offering
Memorandum, to enter into and perform its obligations under the Purchase
Agreement, and to enter into and perform its obligations constituting the
Refinancing.
(iii) The Company is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure so to qualify or
to be in good standing would not result in a Material Adverse Effect.
(iv) The authorized, issued and outstanding capital stock of the
Company is as set forth in the Offering Memorandum in the column entitled
"Actual" under the caption "Capitalization" (except for subsequent issuances, if
any, pursuant to the Purchase Agreement or pursuant to reservations, agreements,
employee benefit plans or the exercise of convertible securities or options
referred to in the Offering Memorandum); the shares of issued and outstanding
capital stock of the Company have been duly authorized and validly issued and
are fully paid and nonassessable; and none of the outstanding shares of capital
stock of the Company was issued in violation of the preemptive or other similar
rights of any securityholder of the Company.
(v) Each Subsidiary of the Company has been duly incorporated and is
validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has corporate power and authority to own,
lease and operate its properties and to conduct its business as described in the
Offering Memorandum and is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure so to qualify or
to be in good standing would not result in a Material Adverse Effect; all of the
issued and outstanding capital stock of each Subsidiary of the Company has been
duly authorized and validly issued, is fully paid and non-assessable and, to the
best of our knowledge and information, is owned by the Company, directly or
through Subsidiaries, free and clear of any security interest, mortgage, pledge,
lien, encumbrance, claim or equity.
A-1
35
(vi) The Purchase Agreement has been duly authorized, executed and
delivered by the Company and (assuming the due authorization, execution and
delivery thereof by the Initial Purchasers) constitutes a valid and binding
agreement of the Company, enforceable against the Company in accordance with its
terms, except as the enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or other similar laws relating to or
affecting enforcement of creditors' rights generally, or by general principles
of equity (regardless of whether enforcement is considered in a proceeding in
equity or at law). . (vii) The Registration Rights Agreement has been duly
authorized, executed and delivered by the Company and (assuming the due
authorization, execution and delivery thereof by the Initial Purchasers)
constitutes a valid and binding agreement of the Company, enforceable against
the Company in accordance with its terms, except as the enforcement thereof may
be limited by bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium or other similar
laws relating to or affecting enforcement of creditors' rights generally, or by
general principles of equity (regardless of whether enforcement is considered in
a proceeding in equity or at law).
(viii) The Indenture has been duly authorized, executed and delivered
by the Company and (assuming the due authorization, execution and delivery
thereof by the Trustee) constitutes a valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms, except as
the enforcement thereof may be limited by bankruptcy, insolvency (including,
without limitation, all laws relating to fraudulent transfers), reorganization,
moratorium or other similar laws relating to or affecting enforcement of
creditors' rights generally, or by general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity or at law).
(ix) The Securities are in the form contemplated by the Indenture,
have been duly authorized by the Company and, when executed by the Company and
authenticated by the Trustee in the manner provided in the Indenture (assuming
the due authorization, execution and delivery of the Indenture by the Trustee)
and delivered against payment of the purchase price therefor will constitute
valid and binding obligations of the Company, enforceable against the Company in
accordance with their terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium (including, without
limitation, all laws relating to fraudulent transfers), or other similar laws
relating to or affecting enforcement of creditor's rights generally, or by
general principles of equity (regardless of whether enforcement is considered in
a proceeding in equity or at law), and will be entitled to the benefits of the
Indenture.
(x) The Securities and the Indenture conform in all material
respects to the descriptions thereof contained in the Offering Memorandum.
(xi) The documents incorporated by reference in the Offering
Memorandum (other than the financial statements and supporting schedules
therein, as to which no opinion need be
A-2
36
rendered), when they were filed with the Commission, complied as to form in all
material respects with the requirements of the 1934 Act and the rules and
regulations of the Commission thereunder.
(xii) There is not pending or, to the best of our knowledge,
threatened any action, suit, proceeding, inquiry or investigation, to which the
Company or any subsidiary is a party, or to which the property of the Company or
any subsidiary thereof is subject, before or brought by any court or
governmental agency or body, which might reasonably be expected to result in a
Material Adverse Effect, or which might reasonably be expected to materially and
adversely affect the properties or assets thereof or the consummation of the
transactions contemplated in the Purchase Agreement or the performance by the
Company of its obligations thereunder or the transactions contemplated by the
Offering Memorandum including those making up the Refinancing;
(xiii) The information in the Offering Memorandum under "Description of
the Notes," "Certain Federal Income Tax Considerations," "Description of the
Bank Credit Facility," and "Exchange Offer; Registration Rights," to the extent
that it constitutes matters of law, summaries of legal matters or legal
conclusions, has been reviewed by them and is correct in all material respects.
(xiv) All descriptions in the Offering Memorandum of contracts and
other documents to which the Company or any of its Subsidiaries are a party are
accurate in all material respects; to the best of our knowledge, there are no
franchises, contracts, indentures, mortgages, loan agreements, notes, leases or
other instruments that would be required to be described in the Offering
Memorandum that are not described or referred to in the Offering Memorandum
other than those described or referred to therein or incorporated by reference
thereto, and the descriptions thereof or references thereto are correct in all
material respects.
(xv) To the best of our knowledge, neither the Company nor any of its
Subsidiaries is in violation of its charter or bylaws and no default by the
Company or any of its Subsidiaries exists in the due performance or observance
of any material obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or other agreement or
instrument that is described or referred to in the Offering Memorandum or filed
or incorporated by reference in the Offering Memorandum.
(xvi) No authorization, approval, consent or order of any court or
governmental authority or agency other than such as may be required under the
applicable securities laws of the various jurisdictions in which the Securities
will be offered or sold, as to which we need express no opinion) is required in
connection with the due authorization, execution and delivery of the Purchase
Agreement or the due execution, delivery or performance of the Indenture by the
Company or for the offering, issuance, sale or delivery of the Securities to the
Initial Purchasers or the resale by the Initial Purchasers in accordance with
the Purchase Agreement.
A-3
37
(xvii) Assuming the accuracy of the representations and warranties of
the Initial Purchasers set forth in this Agreement, it is not necessary in
connection with the offer, sale and delivery of the Notes to the Initial
Purchasers and to each Subsequent Purchaser in the manner contemplated by the
Purchase Agreement and the Offering Memorandum to register the Notes under the
1933 Act or to qualify the Indenture under the Trust Indenture Act.
(xviii) The execution, delivery and performance of the Purchase
Agreement, the DTC Agreement, the Indenture and the Securities and the
consummation of the transactions contemplated in the Purchase Agreement and in
the Offering Memorandum (including the use of the proceeds from the sale of the
Securities as described in the Offering Memorandum under the caption "Use of
Proceeds" and the other components of the Refinancing) and compliance by the
Company with its obligations under the Purchase Agreement, the Indenture and the
Securities will not, whether with or without the giving of notice or lapse of
time or both, conflict with or constitute a breach of, or default or Repayment
Event (as defined in Section l(a)(iii) of the Purchase Agreement) under or
result in the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any subsidiary thereof pursuant to any
contract, indenture, mortgage, deed of trust, loan or credit agreement, note,
lease or any other agreement or instrument, known to us, to which the Company or
any of its Subsidiaries is a party or by which it or any of them may be bound,
or to which any of the property or assets of the Company or any subsidiary
thereof is subject (except for such conflicts, breaches or defaults or liens,
charges or encumbrances that would not have a Material Adverse Effect), nor will
such action result in any violation of the provisions of the charter or by-laws
of the Company or any of its Subsidiaries, or any applicable law, statute, rule,
regulation, judgment, order, writ or decree, known to us, of any government,
government instrumentality or court, domestic or foreign, having jurisdiction
over the Company or any of its Subsidiaries or any of their respective
properties, assets or operations.
(xix) The Company is not an "investment company" or an entity
"controlled" by an investment company," as such terms are defined in the 1940
Act.
Nothing has come to our attention that would lead us to believe that
the Offering Memorandum (except for financial statements and schedules and other
financial data included or incorporated by reference therein as to which we make
no statements) contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Offering Memorandum or any
amendment or supplement thereto (except for financial statements and schedules
and other financial or statistical data included or incorporated by reference
therein, as to which such counsel need make no statement), at the time the
Offering Memorandum was issued, at the time any such amended or supplemented
Offering Memorandum was issued or at the Closing Time, included or includes an
untrue statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
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