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EXHIBIT 1.1
BLUEGREEN CORPORATION
$110,000,000
10-1/2% Senior Secured Notes due 2008
PURCHASE AGREEMENT
March 26, 1998
NatWest Capital Markets Limited
▇▇▇▇▇▇▇▇ & Company Securities, Inc.
c/o NatWest Capital Markets Limited
▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Ladies and Gentlemen:
Each of the undersigned hereby confirms its agreement with you
(the "Initial Purchasers"), as set forth below.
1. THE NOTES. Subject to the terms and conditions herein
contained, Bluegreen Corporation, a Massachusetts corporation (the "Company"),
proposes to issue and sell to the Initial Purchasers $110,000,000 aggregate
principal amount of its 10-1/2% Senior Secured Notes due 2008 (the "Notes"). The
Notes are to be issued under an indenture (the "Indenture") to be dated as of
April 1, 1998 between the Company, each subsidiary of the Company that is a
signatory hereto, as subsidiary guarantors (each a "Guarantor Subsidiary" and
collectively, the "Guarantor Subsidiaries") and SunTrust Bank, Central Florida,
National Association, as trustee (the "Trustee").
The Notes will be offered and sold to the Initial Purchasers
without being registered under the Securities Act of 1933, as amended (the
"Act"), in reliance on exemptions therefrom. Pursuant to the terms of the Notes
and the Indenture, the Notes may only be sold by the Initial Purchasers to a
"qualified institutional buyer" as defined in Rule 144A under the Act ("QIB").
The Notes will be covered by guarantees (each a "Note Guarantee" and
collectively, the "Note Guarantees") from each of the Guarantor Subsidiaries.
The Note Guarantees will be senior obligations of each of the Guarantor
Subsidiaries and will rank PARI PASSU in right of payment with all existing and
future Senior Indebtedness of each of the Guarantor Subsidiaries and senior in
right of payment with all existing and future Subordinated Obligations of each
of the Subsidiaries. The Note Guarantees of certain of the Guarantor
Subsidiaries are secured by a Mortgage (as defined herein) or similar instrument
on certain real property owned by such Guarantor Subsidiaries.
In connection with the sale of the Notes, the Company has
prepared a preliminary offering memorandum dated March 6, 1998 (together with
all the documents incorporated by
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reference therein, the "Preliminary Memorandum") and will prepare a final
offering memorandum dated March 27, 1998 (together with all the documents
incorporated by reference therein, the "Final Memorandum"; the Preliminary
Memorandum and the Final Memorandum each herein being referred to as a
"Memorandum") setting forth or including a description of the terms of the
Notes, the terms of the offering of the Notes and a description of the Company
and the Subsidiaries.
The Company and the Initial Purchasers will enter into a
Registration Rights Agreement (the "Registration Rights Agreement") prior to or
concurrently with the issuance of the Notes. Pursuant to the Registration Rights
Agreement, under the circumstances and the terms set forth therein, the Company
will agree to file with the Securities and Exchange Commission (the
"Commission"): (i) a registration statement on Form S-4 (the "Exchange Offer
Registration Statement") relating to a registered Exchange Offer (as defined in
the Registration Rights Agreement) for the Notes under the Act to offer to the
holders of the Notes the opportunity to exchange their Notes for an issue of
notes substantially identical to the Notes that would be registered under the
Act (the "Exchange Notes") (except that (a) interest thereon will accrue from
the last date on which interest was paid on the Notes, or if no such interest
has been paid, from the date of original issuance of the Notes, (b) such
Exchange Notes will not contain restrictions on transfer, and (c) such Exchange
Notes will not contain provisions relating to an increase in their interest rate
under certain circumstances); or (ii) alternatively, in the event that
applicable interpretations of the Commission do not permit the Company to effect
the Exchange Offer or do not permit any holder of the Notes to participate in
the Exchange Offer, a shelf registration statement (the "Shelf Registration
Statement") to cover resales of Notes by such holders who satisfy certain
conditions, including providing certain information in connection with the Shelf
Registration Statement.
As used herein, the term "Significant Subsidiary" shall mean
those subsidiaries of the Company set forth on Annex I hereto.
2. REPRESENTATIONS AND WARRANTIES. The Company and each
Guarantor Subsidiary represent and warrant to, and agree with, the Initial
Purchasers that:
(a) Neither the Preliminary Memorandum as of the date
thereof nor the Final Memorandum nor any amendment or supplement
thereto as of the date thereof and, in the case of the Final Memorandum
and any amendment or supplement thereto, at all times subsequent
thereto up to the Closing Date (as defined in Section 3 below)
contained or shall contain any untrue statement of a material fact or
omitted or omits to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading, except that the representations and
warranties set forth in this Section 2(a) do not apply to statements or
omissions made in reliance upon and in conformity with information
furnished to the Company in writing by the Initial Purchasers expressly
for use in the Preliminary Memorandum, the Final Memorandum or any
amendment or supplement thereto.
(b) As of the Closing Date, (i) the Company will have
the authorized and issued capital stock set forth in the Final
Memorandum; (ii) (A) the ▇▇▇▇▇▇▇▇▇
▇
▇
▇▇▇▇▇▇▇▇▇▇▇▇, (▇) each subsidiary of the Company that constitutes a
Receivables Subsidiary (as defined in the Final Memorandum); (C)
Bluegreen Aruba N.V., (D) Resort Title Agency, Inc. and (E) each
subsidiary of the Company which is established and continues to operate
for the limited purpose of holding a real estate broker's license and
acting as a broker for the Company and its subsidiaries in connection
with the sale of real estate or timeshare interests (collectively, the
"Subsidiaries"), constitute all of the subsidiaries of the Company;
(iii) the Company will own, directly or indirectly, the percentage of
the issued and outstanding stock (or other equity securities) of each
of the Subsidiaries as listed on Schedule 2 hereto; (iv) all of the
outstanding shares of capital stock of the Company and the Subsidiaries
as of the Closing Date will be duly authorized and validly issued, will
be fully paid and nonassessable and will not have been issued in
violation of any preemptive or similar rights; (v) except as set forth
in the Final Memorandum, there are no (x) options, warrants or other
rights to purchase from the Company and the Subsidiaries, (y)
agreements or other obligations of the Company or any of the
Subsidiaries to issue or (z) other rights to convert any obligation
into, or exchange any securities for, shares of capital stock of, or
other equity securities in, the Company or any of the Subsidiaries
outstanding. Except as disclosed on Schedule 2, the Company does not
own, directly or indirectly, any capital stock or any other equity or
long-term debt securities or have any equity interests in any firm,
partnership, joint venture, limited liability company or other entity.
(c) The Company and each of the Subsidiaries has been
duly organized, is validly existing and is in good standing as a
corporation, limited partnership or limited liability company, as the
case may be, under the laws of its jurisdiction of incorporation or
formation, with all requisite corporate or partnership power and
authority to own its properties and conduct its business as now
conducted, and as described in the Final Memorandum; each of the
Company and the Subsidiaries is duly qualified to do business as a
foreign corporation, limited partnership or limited liability company
in good standing in all other jurisdictions where the ownership or
leasing of its properties or the conduct of its business requires such
qualification, except where the failure to be so qualified would not,
individually or in the aggregate, have a material adverse effect on the
general affairs, management, business, condition (financial or
otherwise), prospects or results of operations of the Company and the
Subsidiaries, taken as a whole (any such event, a "Material Adverse
Effect").
(d) The Company has all requisite corporate power and
authority to execute, deliver and perform its obligations under the
Notes. The Notes, when issued, will be in the form contemplated by the
Indenture. The Notes have been duly and validly authorized, executed
and delivered by the Company and, when authenticated by the Notes
Trustee in accordance with the provisions of the Indenture and when
delivered to and paid for by the Initial Purchasers in accordance with
the terms of this Agreement, will have been duly executed, issued and
delivered and will constitute valid and legally binding obligations of
the Company, will entitle the Initial Purchasers to the benefits of the
Indenture and will be enforceable against the Company in accordance
with their terms, except as the enforceability thereof may be limited
by bankruptcy, insolvency, reorganization, fraudulent transfer or
conveyance or other similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles
(regardless of whether the issue of enforceability is considered in a
proceeding in equity or at law).
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(e) The Company and each Guarantor Subsidiary has all
requisite corporate or partnership power and authority to execute,
deliver and perform its obligations under the Indenture. The Indenture
meets the requirements for qualification under the Trust Indenture Act
of 1939, as amended (the "TIA"). The Indenture has been duly and
validly authorized, executed and delivered by the Company and each
Guarantor Subsidiary and will constitute a valid and legally binding
agreement of the Company and each Guarantor Subsidiary, enforceable
against the Company and each Guarantor Subsidiaries in accordance with
its terms, except as the enforceability thereof may be limited by
bankruptcy, insolvency, reorganization, fraudulent transfer or
conveyance or other similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles
(regardless of whether the issue of enforceability is considered in a
proceeding in equity or at law).
(f) The Exchange Notes and the Private Exchange Notes
(as defined in the Registration Rights Agreement) have been duly and
validly authorized by the Company, and when the Exchange Notes have
been duly executed and delivered by the Company and authenticated by
the Notes Trustee in accordance with the terms of the Registration
Rights Agreement and the Indenture, will constitute the valid and
legally binding obligations of the Company, entitled to the benefits of
the Indenture, and will be enforceable against the Company in
accordance with their terms, except as the enforceability thereof may
be limited by bankruptcy, insolvency, reorganization, fraudulent
transfer or conveyance or other similar laws affecting the enforcement
of creditors' rights generally and by general equitable principles
(regardless of whether the issue of enforceability is considered in a
proceeding in equity or at law).
(g) The Company and each Guarantor Subsidiary has all
requisite corporate or partnership power and authority to execute,
deliver and perform its obligations under the Registration Rights
Agreement. The Registration Rights Agreement has been duly and validly
authorized, executed and delivered by the Company and each Guarantor
Subsidiary and constitutes a valid and legally binding agreement of the
Company and each Guarantor Subsidiary enforceable against the Company
and each Guarantor Subsidiary in accordance with its terms, except (A)
as the enforceability thereof may be limited by bankruptcy, insolvency,
reorganization, fraudulent transfer or conveyance or other similar laws
affecting the enforcement of creditors' rights generally and by general
equitable principles (regardless of whether the issue of enforceability
is considered in a proceeding in equity or at law), and (B) that any
rights to indemnity or contribution thereunder may be limited by
federal or state securities laws or public policy considerations.
(h) Each of the Guarantor Subsidiaries has all
requisite corporate or partnership power and authority to execute,
deliver and perform its obligations under the Note Guarantee executed
by it. Each Note Guarantee has been duly and validly authorized,
executed and delivered by the applicable Guarantor Subsidiary and
constitutes a valid and legally binding agreement of such Guarantor
Subsidiary enforceable against such Guarantor Subsidiary in accordance
with its terms, except as the enforceability thereof may be limited by
bankruptcy, insolvency, reorganization, fraudulent transfer or
conveyance or other similar laws affecting the enforcement of
creditors' rights generally
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and by general equitable principles (regardless of whether the issue
of enforceability is considered in a proceeding in equity or at law).
(i) Each of the Significant Subsidiaries which owns
Pledged Properties (as defined in the Indenture) has marketable fee
simple title to such Pledged Properties identified in Schedule P to the
Indenture as being owned by it; no person or entity has any right,
option, or first refusal to purchase or lease all or any part of the
Pledged Properties except for bona fide purchasers of Residential Lots
(as defined in the Indenture); there are no parties in possession of
any of the Pledged Properties other than the Significant Subsidiary
identified in Schedule P to the Indenture as being the owner thereof;
there is no litigation pending, or to the best of the knowledge of the
Company and each Significant Subsidiary, threatened against or
affecting any of the Pledged Properties that would have a material
adverse effect upon the Company, any Significant Subsidiary, or any of
the Pledged Properties; each of the Pledged Properties is in compliance
with all governmental laws, rules, and regulations, including those
pertaining to the environment, except where non-compliance could not
have a material adverse effect on the value of such Pledged Property;
and each of the Pledged Properties is free and clear of all liens
(including mechanics' liens, mortgages and deeds of trust) except for
the lien for taxes and assessments which are not yet due and payable.
(j) The Company and each Guarantor Subsidiary has all
requisite corporate or partnership power and authority to execute,
deliver and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby. This Agreement has
been duly and validly authorized, executed and delivered by the Company
and each Guarantor Subsidiary.
(k) No consent, approval, authorization or order of
any court or governmental agency or body or third party is required for
the execution, delivery or performance of this Agreement, the Notes,
the Note Guarantees, the Mortgages, the Registration Rights Agreement
or the Indenture by the Company or the Guarantor Subsidiaries or the
consummation by the Company or any Guarantor Subsidiary of this
Agreement, the Note Guarantees, the Mortgages, the Registration Rights
Agreement and the Indenture or the consummation by the Company or any
of the Guarantor Subsidiaries of the transactions contemplated hereby
or thereby that are to be completed on or before the Closing Date,
except such as have been obtained or disclosed in the Final Memorandum
and such as may be required under state securities or "Blue Sky" laws
in connection with the purchase and resale of the Notes by the Initial
Purchasers. None of the Company or any of the Subsidiaries is (i) in
violation of its certificate of incorporation or bylaws (or similar
organizational documents), (ii) in breach or violation of any statute,
judgment, decree, order, rule or regulation applicable to any of them
or any of their respective properties or assets, or (iii) in breach of
or in default under (nor has any event occurred which, with notice or
passage of time or both, would constitute a default under)
or in violation of any of the terms or provisions of any material
indenture, mortgage, deed of trust, loan agreement, note, lease,
license, franchise agreement, permit, certificate, contract or other
agreement or instrument to which any of them is a party or to which any
of them or their respective properties or assets is subject
(collectively, "Contracts") except
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in the case of clauses (ii) and (iii) above for such violations,
breaches or defaults that would not, individually or in the aggregate,
have a Material Adverse Effect.
(l) The execution, delivery and performance by the
Company and the Guarantor Subsidiaries of this Agreement, the Notes,
the Exchange Notes, the Note Guarantees, the Mortgages, the Indenture
and the Registration Rights Agreement and the consummation by the
Company and the Subsidiaries of the transactions contemplated hereby
and thereby, will not conflict with or constitute or result in a breach
of or a default under (or an event which with notice or passage of time
or both would constitute a default under) or violation of any of (i)
the terms or provisions of any Contract except such conflicts,
breaches, defaults or violations, that would not, individually or in
the aggregate, have a Material Adverse Effect, (ii) the certificate of
incorporation or by-laws (or similar organizational document) of the
Company or any of the Subsidiaries, or (iii) any statute, judgment,
decree, order, rule or regulation applicable to the Company or any of
the Subsidiaries or any of their respective properties or assets except
such conflicts, breaches, defaults or violations that would not,
individually or in the aggregate, have a Material Adverse Effect.
(m) The audited consolidated financial statements of
the Company and its consolidated Subsidiaries included in the
Preliminary Memorandum and the Final Memorandum present fairly in all
material respects the financial condition, results of operations and
cash flows of such entities at the dates and for the periods to which
they relate and have been prepared in accordance with generally
accepted accounting principles in the United States applied on a
consistent basis except as otherwise stated therein. The summary and
selected financial and statistical data in the Preliminary Memorandum
and the Final Memorandum present fairly in all material respects the
information shown therein and have been prepared and compiled on a
basis consistent with the audited financial statements included
therein, except as otherwise stated therein. Ernst & Young LLP is an
independent public accounting firm within the meaning of the Act and
the rules and regulations promulgated thereunder.
(n) There is not pending or, to the knowledge of the
Company, threatened, any action, suit, proceeding, inquiry,
investigation or legislative mandate to which the Company or any of the
Subsidiaries is a party, or to which the property or assets of the
Company or any of the Subsidiaries are subject, before or brought by
any court, arbitrator or governmental agency or body which is
reasonably likely to, individually or in the aggregate, have a Material
Adverse Effect or which seeks to restrain, enjoin, prevent the
consummation of or otherwise challenge the issuance or sale of the
Notes to be sold hereunder or the consummation of the other
transactions described in the Preliminary Memorandum and the Final
Memorandum.
(o) Each of the Company and the Subsidiaries owns or
possesses adequate licenses or other rights to use all material
trademarks, service marks, trade names, copyrights and know-how
necessary to conduct the businesses now or proposed to be operated by
it as described in the Preliminary Memorandum and the Final Memorandum,
except where the failure to own or possess the same would not,
individually or in the aggregate, have a Material Adverse Effect, and
neither the Company
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nor any of the Subsidiaries has received any notice of infringement of
or conflict with (or knows of any such infringement of or conflict
with) asserted rights of others with respect to any patents,
trademarks, service marks, trade names, copyrights or know-how which,
if such assertion of infringement or conflict were sustained, would,
individually or in the aggregate, have a Material Adverse Effect.
(p) The Company and each of the Subsidiaries
possesses all licenses, permits, certificates, consents, orders,
approvals and other authorizations from, and has made all declarations
and filings with, all federal, state, local, foreign and other
governmental authorities, all self-regulatory organizations and all
courts and other tribunals, presently required or necessary to own or
lease, as the case may be, and to operate its respective properties and
to carry on its respective businesses as now or proposed to be
conducted as described in the Preliminary Memorandum and the Final
Memorandum (collectively, the "Permits"), except where the failure to
obtain such Permits would not, individually or in the aggregate, have a
Material Adverse Effect; each of the Company and the Subsidiaries has
fulfilled and performed all of its obligations with respect to such
Permits and no event has occurred which allows, or after notice or
lapse of time would allow, revocation or termination thereof or results
in any other material impairment of the rights of the holder of any
such Permit except where such failure or such revocation, termination
or impairment would not, individually or in the aggregate, have a
Material Adverse Effect; and none of the Company or the Subsidiaries
has received any notice of any proceeding relating to revocation or
modification of any such Permit, except as described in the Final
Memorandum and except where such revocation or modification would not,
individually or in the aggregate, have a Material Adverse Effect.
(q) Since the date of the most recent financial
statements appearing in the Final Memorandum, except for the
transactions contemplated by this Agreement and/or as described
therein, (i) neither the Company nor any Subsidiary has incurred any
liabilities or obligations, direct or contingent, or entered into or
agreed to enter into any transactions or contracts (written or oral)
not in the ordinary course of business which liabilities, obligations,
transactions or contracts would, individually or in the aggregate, be
material to the general affairs, management, business, condition
(financial or otherwise), prospects or results of operations of the
Company and the Subsidiaries, either individually or taken as a whole
(a "Material Change"), (ii) neither the Company nor any Subsidiary has
purchased any of its outstanding capital stock, nor has the Company
declared, paid or otherwise made any dividend or distribution of any
kind on its capital stock and (iii) other than as described in the
Final Memorandum, there shall not have been any change in the capital
stock or long-term indebtedness of the Company or the Subsidiaries
which would, individually or in the aggregate, constitute a Material
Change.
(r) There has not occurred any material adverse
change, or any development involving a prospective material adverse
change, in the general affairs, management, business, condition,
(financial or otherwise), prospects or results of operations of the
Company and the Subsidiaries, taken as a whole, from that set forth in
the Preliminary Memorandum and the Final Memorandum.
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(s) The Company and each of the Subsidiaries have
filed all necessary federal, state, local and foreign income and
franchise tax returns, and have paid all taxes shown as due thereon;
and there is no tax deficiency that has been asserted against the
Company or any of the Subsidiaries other than tax deficiencies which
the Company or such Subsidiary is contesting in good faith and for
which the Company or such Subsidiary has provided adequate reserves.
(t) The statistical and market-related data included
in the Final Memorandum are based on or derived from sources which the
Company and the Subsidiaries believe to be reliable and accurate.
(u) None of the Company, the Subsidiaries nor any
agent acting on their behalf has taken or will take any action that
might cause this Agreement or the sale of the Notes to violate
Regulation G, T, U or X of the Board of Governors of the Federal
Reserve System, in each case as in effect, or as the same may hereafter
be in effect, on the Closing Date.
(v) Each of the Company and the Subsidiaries has good
and marketable title to all real property and good title to all
personal property described in the Final Memorandum as being owned by
it and good and marketable title to any leasehold estate in the real
and personal property described in the Final Memorandum as being leased
by it free and clear of all liens, charges, encumbrances or
restrictions, except as described in the Final Memorandum and/or the
Permitted Liens (as defined in the Indenture).
(w) Except as would not, individually or in the
aggregate, be reasonably expected to have a Material Adverse Effect (A)
each of the Company and the Subsidiaries is in compliance with and not
subject to liability under applicable Environmental Laws (as defined
below), (B) each of the Company and the Subsidiaries has made all
filings and provided all notices required under any applicable
Environmental Laws, and has and is in compliance with all Permits
required under any applicable Environmental Laws and each of them is in
full force and effect, (C) there is no civil, criminal or
administrative action, suit, demand, claim, hearing, notice of
violation, investigation, proceeding, notice or demand letter or
request for information pending or, to the knowledge of the Company or
any of the Subsidiaries, threatened against the Company or any of the
Subsidiaries under any Environmental Law, (D) no lien, charge,
encumbrance or restriction has been recorded under any Environmental
Law with respect to any assets, facility or property owned, operated,
leased or controlled by the Company or any of the Subsidiaries, (E)
none of the Company or the Subsidiaries has received notice that it has
been identified as a potentially responsible party under the
Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended ("CERCLA") or any comparable state law, (F) no
property or facility of the Company or any of the Subsidiaries is (i)
listed or proposed for listing on the National Priorities List under
CERCLA or is (ii) listed in the Comprehensive Environmental Response,
Compensation, Liability Information System List promulgated pursuant to
CERCLA, or on any comparable list maintained by any state or local
governmental authority.
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For purposes of this Agreement, "Environmental Laws"
means the common law of any applicable jurisdiction and all applicable
federal, state, local and foreign laws or regulations, codes, orders,
decrees, judgments or injunctions issued, promulgated, approved or
entered thereunder, relating to pollution or protection of public or
employee health and safety or the environment, including, without
limitation, law relating to (i) emissions, discharges, releases or
threatened releases of hazardous materials, into the environment
(including, without limitation, ambient air, surface water, ground
water, land surface or subsurface strata), (ii) the manufacture,
processing, distribution, use, generation, treatment, storage,
disposal, transport or handling of hazardous materials, and (iii)
underground and above ground storage tanks, and related piping, and
emissions, discharges, releases or threatened releases therefrom.
(x) Except as disclosed in the Final Memorandum,
there is no strike, labor dispute, slowdown or work stoppage with the
employees of the Company or any of the Subsidiaries which is pending
or, to the knowledge of the Company or any of the Subsidiaries,
threatened.
(y) Each of the Company and the Subsidiaries carries
insurance in such amounts and covering such risks as is customary for
companies engaged in similar businesses. Neither the Company nor any of
the Subsidiaries has received notice from any insurer or agent of such
insurer that capital improvements or other expenditures are required or
necessary to be made in order to continue such insurance.
(z) None of the Company nor the Subsidiaries has any
material liability for any prohibited transaction (within the meaning
of Section 4975(c) of the Internal Revenue Code of 1986, as amended
(the "Code") or Part 4 of Title I of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA")) (or an accumulated funding
deficiency within the meaning of Section 412 of the Code or Section 302
of ERISA) or any complete or partial withdrawal liability (within the
meaning of Section 4201 of ERISA) with respect to any pension, profit
sharing or other plan which is subject to ERISA, to which the Company
or any of the Subsidiaries makes or ever has made a contribution and in
which any employee of the Company or of any Subsidiary is or has ever
been a participant. With respect to such plans, the Company and each
Subsidiary is in compliance in all material respects with all
applicable provisions of ERISA.
(aa) The Company and each of the Subsidiaries (i)
makes and keeps accurate books and records and (ii) maintains internal
accounting controls which provide reasonable assurance that (A)
transactions are executed in accordance with management's
authorization, (B) transactions are recorded as necessary to permit
preparation of its financial statements and to maintain accountability
for its assets, (C) access to its assets is permitted only in
accordance with management's authorization and (D) the reported
accountability for its assets is compared with existing assets at
reasonable intervals.
(bb) None of the Company nor the Subsidiaries will be
an "investment company" or "promoter" or "principal underwriter" for an
"investment company or a
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company controlled by an investment company within the meaning of the
Investment Company Act of 1940, as amended, and the rules and
regulations thereunder.
(cc) The Notes, the Exchange Notes, the Note
Guarantees, the Mortgages, the Registration Rights Agreement and the
Indenture conform in all material respects to the descriptions thereof
in the Final Memorandum.
(dd) Except as described in the Final Memorandum, no
holder of securities of the Company nor any of the Subsidiaries will be
entitled to have such securities registered under the registration
statements required to be filed by the Company pursuant to the
Registration Rights Agreement other than as expressly permitted
thereby.
(ee) Immediately after the consummation of the
transactions contemplated by this Agreement, the fair value and present
fair saleable value of the assets of each of the Company and the
Subsidiaries (each on a consolidated basis) will exceed the sum of its
stated liabilities and identified contingent liabilities; none of the
Company or the Subsidiaries (each on a consolidated basis) is, nor will
any of the Company or the Subsidiaries (each on a consolidated basis)
be, after giving effect to the execution, delivery and performance of
this Agreement, and the consummation of the transactions contemplated
hereby, (i) left with unreasonably small capital with which to carry on
its business as it is currently or proposed to be conducted, (ii)
unable to pay its debts (contingent or otherwise) as they mature or
otherwise become due or (iii) otherwise insolvent.
(ff) None of the Company, the Subsidiaries or any of
their respective Affiliates (as defined in Rule 501(b) of Regulation D
under the Act) has directly, or through any agent (other than the
Initial Purchasers pursuant to this Agreement), (i) sold, offered for
sale, solicited offers to buy or otherwise negotiated in respect of,
any "security" (as defined in the Act) which is or could be integrated
with the sale of the Notes in a manner that would require the
registration under the Act of the Notes or (ii) engaged in any form of
general solicitation or general advertising (as those terms are used in
Regulation D under the Act) in connection with the offering of the
Notes or in any manner involving a public offering within the meaning
of Section 4(2) of the Act. The Company has not distributed and will
not distribute any offering material in connection with the offering of
the Notes other than the Final Memorandum and any Preliminary
Memorandum. No securities of the same class as the Notes have been
issued and sold by the Company within the six-month period immediately
prior to the date hereof.
(gg) Assuming the accuracy of the representations and
warranties of the Initial Purchasers in Section 8 hereof, it is not
necessary in connection with the offer, sale and delivery of the Notes
to the Initial Purchasers in the manner contemplated by this Agreement
to register the Notes under the Act or to qualify the Indenture under
the TIA.
(hh) No securities of the Company or any of the
Subsidiaries are of the same class (within the meaning of Rule 144A as
promulgated under the Act ("Rule 144A")) as the Notes and listed on a
national securities exchange registered under Section
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6 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), or quoted in a U.S. automated inter-dealer quotation system.
(ii) None of the Company or the Subsidiaries has
taken, nor will any of them take, directly or indirectly, any action
designed to, or that might be reasonably expected to, cause or result
in stabilization or manipulation of the price of the Notes.
(jj) Each of the Preliminary Memorandum and the Final
Memorandum, as of its respective date, contains all of the information
that, if requested by a prospective purchaser of any of the Notes,
would be required to be provided to such prospective purchaser pursuant
to Rule 144A(d)(4) under the Act.
(kk) The Notes satisfy the eligibility requirements
of Rule 144A(d)(3) under the Act.
(ll) Neither the Company nor any of the Subsidiaries
nor, to the Company's knowledge, any officer or director purporting to
act on behalf of the Company or any of the Subsidiaries has at any
time: (i) made any contributions to any candidate for political office,
or failed to disclose fully any such contributions, in violation of
law, (ii) made any payment of funds to, or received or retained any
funds from, any state, federal or foreign governmental officer or
official, or other person charged with similar public or quasi-public
duties, other than payments required or allowed by applicable law,
(iii) violated or is in violation of any provision of the Foreign
Corrupt Practices Act of 1977, (iv) made any bribe, rebate, payoff,
influence payment, kickback or other unlawful payment or (v) engaged in
any transaction, maintained any bank account or used any corporate
funds except for transactions, bank accounts and funds which have been
and are reflected in the normally maintained books and records of the
Company and the Subsidiaries.
(mm) Except as disclosed in the Preliminary
Memorandum or the Final Memorandum, there are no material outstanding
loans or advances or material guarantees of indebtedness by the Company
or any of its Subsidiaries to or for the benefit of any of the officers
or directors of the Company or any of its Subsidiaries or any of the
members of the families of any of them.
(nn) Neither the Company nor any of the Subsidiaries
has engaged or retained any person, other than NatWest Capital Markets
Limited and ▇▇▇▇▇▇▇▇ & Company Securities, Inc. (the "Initial
Purchasers"), to act as a financial advisor, underwriter or placement
agent in connection with the issuance of any of the Notes and, except
for the fees and expenses payable in connection with the issuance of
the Notes as described in the Final Memorandum, no person other than
the Initial Purchasers has the right to receive a material amount of
financial advisory, underwriting, placement, finder's or similar fees
in connection with, or as a result of, the issuance of the Notes and
the purchase of the Notes by the Initial Purchasers or the consummation
of the other transactions contemplated hereby.
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3. PURCHASE, SALE AND DELIVERY OF THE NOTES. On the basis of
the representations, warranties, agreements and covenants herein contained and
subject to the terms and conditions herein set forth, the Company agrees to
issue and sell to the Initial Purchasers, and the Initial Purchasers agree, to
purchase from the Company the principal amount of Notes set forth opposite their
respective names on Schedule 1 hereto at 97.25% of their principal amount. One
or more certificates in definitive form for the Notes that the Initial
Purchasers have agreed to purchase hereunder, and in such denomination or
denominations and registered in such name or names as each of the Initial
Purchasers requests upon notice to the Company at least 48 hours prior to the
Closing Date, shall be delivered by or on behalf of the Company to the Initial
Purchasers, against payment by or on behalf of such Initial Purchasers of the
purchase price therefor by wire transfer of same-day funds to such account or
accounts as the Company shall specify prior to the Closing Date, or by such
means as the parties hereto shall agree prior to the Closing Date. Such delivery
of and payment for the Notes shall be made at the offices of ▇▇▇▇▇, Day, ▇▇▇▇▇▇
& ▇▇▇▇▇ in New York, New York on April 1, 1998, or at such other place, time or
date as the Initial Purchasers, on the one hand, and the Company, on the other
hand, may agree upon, such time and date of delivery against payment being
herein referred to as the "Closing Date." The Company will make such certificate
or certificates for the Notes available for inspection and packaging by the
Initial Purchasers at such place as designated by the Initial Purchasers at
least 24 hours prior to the Closing Date.
4. OFFERING BY THE INITIAL PURCHASERS. Subject to the terms of
this Agreement, the Initial Purchasers propose to make an offering of the Notes
at the price and upon the terms set forth in the Final Memorandum, as soon as
practicable after this Agreement is entered into and as in the judgment of the
Initial Purchasers is advisable.
5. COVENANTS OF THE COMPANY AND THE SUBSIDIARIES. The Company
and each of the Subsidiaries covenants and agrees with the Initial Purchasers
that:
(a) The Company will not amend or supplement the
Final Memorandum or any amendment or supplement thereto of which the
Initial Purchasers shall not previously have been advised and furnished
a copy for a reasonable period of time prior to the proposed amendment
or supplement and as to which the Initial Purchasers shall not have
consented.
(b) The Company will cooperate with the Initial
Purchasers in arranging for the qualification of the Notes for offering
and sale under the securities or "Blue Sky" laws of such jurisdictions
as the Initial Purchasers may designate and will continue such
qualifications in effect for as long as may be necessary to complete
the resale of the Notes by the Initial Purchasers; provided, however,
that in connection therewith, the Company shall not be required to
qualify as a foreign corporation or as a dealer in securities or to
execute a general consent to service of process in any jurisdiction
where it is not then so subject or to subject itself to taxation in
respect of doing business in any jurisdiction in which it is otherwise
not subject.
(c) If, at any time prior to the completion of the
distribution by the Initial Purchasers of the Notes, any event occurs
or information becomes known as a result of which the Final Memorandum
as then amended or supplemented would, in the
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judgment of the Company or in the reasonable opinion of counsel for the
Initial Purchasers, include any untrue statement of a material fact, or
omit to state a material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading, or if for any other reason it is necessary at any time to
amend or supplement the Final Memorandum to comply with applicable law,
the Company will promptly notify the Initial Purchasers thereof and
will prepare, at the expense of the Company, an amendment or supplement
to the Final Memorandum that corrects such statement or omission or
effects such compliance.
(d) The Company will, without charge, provide to the
Initial Purchasers and to counsel for the Initial Purchasers as many
copies of the Preliminary Memorandum and the Final Memorandum or any
amendment or supplement thereto as the Initial Purchasers may
reasonably request.
(e) The Company will apply the net proceeds from the
sale of the Notes substantially as set forth under "Use of Proceeds" in
the Final Memorandum.
(f) For a period of five years after the Closing
Date, (x) the Company will furnish to the Initial Purchasers copies of
all reports and other communications (financial or otherwise) furnished
by the Company to the Notes Trustee, the holders of the Notes and, as
soon as available, copies of all annual reports, quarterly reports and
current reports filed with the Commission on Forms 10-K, 10-Q and 8-K,
or such other similar forms as may be designated by the Commission and
(y) the Company will make available, upon request, to any seller of
Notes the information specified in Rule 144A(d)(4) under the Act,
unless the Company is then subject to Section 13 or 15(d) of the
Exchange Act.
(g) [Omitted]
(h) None of the Company, the Subsidiaries or any of
their Affiliates will sell, offer for sale or solicit offers to buy or
otherwise negotiate in respect of any "security" (as defined in the
Act) which could be integrated with the sale of any of the Notes in a
manner which would require the registration under the Act of any of the
Notes.
(i) None of the Company nor the Subsidiaries will
engage in any form of "general solicitation" or "general advertising"
(as those terms are used in Regulation D under the Act) in connection
with the offering of the Notes or in any manner involving a public
offering of the Notes within the meaning of Section 4(2) of the Act.
(j) For a period of 180 days from the date of the
Final Memorandum, the Company and the Subsidiaries will not offer for
sale, sell, contract to sell or otherwise dispose of, directly or
indirectly, or file a registration statement for, or announce any
offer, sale, contract for sale of or other disposition of any debt
securities issued or guaranteed by the Company or any of its
Subsidiaries that are substantially similar to the Notes (other than
the Exchange Notes) without the prior written consent of the Initial
Purchasers.
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(k) During the period from the Closing Date until two
years after the Closing Date, without the prior written consent of the
Initial Purchasers, the Company and the Subsidiaries will not, and will
not permit any of their affiliates (as defined in Rule 144 under the
Act) to, resell any of the Notes that have been reacquired by them,
except for Notes purchased by the Company or any of its affiliates and
resold in a transaction registered under the Act.
(l) In connection with the offering of the Notes,
until the Initial Purchasers shall have notified the Company of the
completion of the resale of the Notes by them, the Company and its
Subsidiaries will not, and will cause their affiliated purchasers (as
defined in the Exchange Act) not to, either alone or with one or more
other persons, bid for or purchase, for any account in which it or any
of its affiliated purchasers has a beneficial interest, any Notes, or
attempt to induce any person to purchase any Notes; and will not, and
will cause its affiliated purchasers not to, make bids or purchase for
the purpose of creating actual, or apparent, active trading in or of
raising the price of the Notes.
(m) Except as contemplated by the Final Memorandum,
the Company and the Subsidiaries will not take any action prior to the
execution and delivery of the Indenture which, if taken after such
execution and delivery, would have violated any of the covenants
contained therein.
(n) The Company and the Subsidiaries will not take
any action prior to Closing Date which would require the Final
Memorandum to be amended or supplemented pursuant to Section 5(c).
(o) Prior to the Closing Date, the Company and the
Subsidiaries will not issue any press release or other communication
directly or indirectly or hold any press conference with respect to the
Company, its condition, financial or otherwise, or earnings, business
affairs or business prospects, without the prior written consent of the
Initial Purchasers, unless in the judgment of the Company and its
counsel, after notification to the Initial Purchasers, such press
release or communication is required by law.
(p) The Company will use its best efforts to permit
the Notes to be designated PORTAL securities in accordance with the
rules and regulations adopted by the NASD relating to trading in the
Private Offerings, Resales and Trading through Automated Linkages
market (the "Portal Market") and permit the Notes to be eligible for
clearance and settlement through the Depository Trust Company ("DTC").
(q) The Company and each of the Subsidiaries will use
their best efforts and will assist counsel for the Initial Purchasers,
to obtain title insurance policies, in each case in form and content
reasonably satisfactory to the Initial Purchasers, for each of the
Pledged Properties as soon as reasonably practicable after the Closing
Date. It is understood that such title insurance policies will reflect
customary exceptions which are acceptable to mortgage lenders generally
and that any encumbrance on a mortgaged property which existed at the
time the Company or one of its Subsidiaries acquired the property shall
be acceptable. Each policy obtained shall be in an amount not less than
the
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cost basis of the applicable property as of January 25, 1998 (minus any
land which has been sold since that date). The Company and each of the
Subsidiaries agree that the Initial Purchasers and any subsequent
holders of the Notes will suffer damages if such title insurance
policies are not obtained for all of the Pledged Properties by the 60th
day following the Closing Date, and further agree that it would not be
feasible to ascertain the extent of such damages with precision.
Accordingly, the Company and the Subsidiaries agree to pay, as
liquidated damages and as the sole and exclusive remedy therefor,
additional interest on the Notes ("Title Insurance Additional
Interest") at the rate of 0.50% per annum commencing on the 61st day
after the Closing Date. The Title Insurance Additional Interest rate on
the Notes pursuant to clause (i) above shall be in addition to any
Notes Additional Interest (as defined in the Registration Rights
Agreement) that may be accruing pursuant to the Registration Rights
Agreement. Title Insurance Additional Interest on the Notes will cease
to accrue upon the earlier to occur of (A) date on which a title
insurance policy, in form and content reasonably satisfactory to the
Initial Purchasers, for the last of the Pledged Properties is delivered
to and received by the Initial Purchasers or (B) the date on which the
last of the Pledged Properties has been sold.
The Company shall pay any Title Insurance Additional
Interest due on the Notes by depositing with the paying agent (which
shall not be the Company for these purposes) for the Notes, in trust,
for the benefit of the holders thereof, prior to 11:00 A.M. on the next
interest payment date specified by the Indenture (or such other
indenture), sums sufficient to pay the Title Insurance Additional
Interest then due. Any amounts of Title Insurance Additional Interest
due pursuant to this clause (q) will be payable in cash, semi-annually
on each interest payment date specified by the Indenture (or such other
indenture) to the record holders entitled to receive the interest
payment to be made on such date, commencing with the first such date
occurring after any such Title Insurance Additional Interest commences
to accrue. The amount of Title Insurance Additional Interest will be
determined by multiplying the applicable Title Insurance Additional
Interest rate by the principal amount of the affected Notes of such
holders, multiplied by a fraction, the numerator of which is the number
of days such Title Insurance Additional Interest rate was applicable
during such period (determined on the basis of a 360-day year comprised
of twelve 30-day months and, in the case of a partial month, the actual
number of days elapsed), and the denominator of which is 360.
6. EXPENSES. The Company and the Subsidiaries agree, jointly
and severally, to pay all costs and expenses incident to the performance of
their obligations under this Agreement, whether or not the transactions
contemplated herein are consummated or this Agreement is terminated pursuant to
Section 11 hereof, including all costs and expenses incident to (i) the
printing, word processing or other production of documents with respect to the
transactions contemplated hereby, including any costs of printing the
Preliminary Memorandum and the Final Memorandum and any amendment or supplement
thereto, and any "Blue Sky" memoranda, (ii) all arrangements relating to the
delivery to the Initial Purchasers of copies of the foregoing documents, (iii)
the fees and disbursements of counsel, accountants and any other experts or
advisors retained by the Company, (iv) preparation (including printing),
issuance and delivery to the Initial Purchasers of the Notes, (v) the
qualification of the Notes under state securities and "Blue Sky" laws, including
filing fees and reasonable fees and disbursements of
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counsel for the Initial Purchasers relating thereto, (vi) expenses in connection
with any meetings with prospective investors in the Notes, (vii) fees and
expenses of the Trustee (including reasonable fees and expenses of counsel),
(viii) all expenses and listing fees incurred in connection with the application
for quotation of the Notes on the PORTAL Market, (ix) all expenses incurred in
connection with the approval of the Notes for book-entry transfer by DTC, (x)
the reasonable fees and disbursements of legal counsel retained by the Initial
Purchasers, (xi) all other reasonable out-of-pocket expenses of the Initial
Purchasers (including, without limitation, all road show expenses) incurred by
the Initial Purchasers or any of their affiliates in connection with, or arising
out of, the offering and sale of the Notes and (xii) any fees charged by
investment rating agencies for the rating of the Notes. If the sale of the Notes
provided for herein is not consummated because any condition to the obligations
of the Initial Purchasers set forth in Section 7 hereof is not satisfied,
because this Agreement is terminated pursuant to Section 11 or because of any
failure, refusal or inability on the part of the Company to perform all
obligations and satisfy all conditions on their part to be performed or
satisfied hereunder (other than solely by reason of a default by the Initial
Purchasers of their obligations hereunder after all conditions hereunder have
been satisfied in accordance herewith), the Company agrees to promptly reimburse
the Initial Purchasers upon demand for all out-of-pocket expenses (including all
reasonable fees, disbursements and charges of ▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇) that
shall have been incurred by the Initial Purchasers in connection with the
proposed purchase and sale of the Notes.
7. CONDITIONS OF THE INITIAL PURCHASERS'
OBLIGATIONS. The obligation of the Initial Purchasers to purchase and pay for
the Notes shall be subject to the satisfaction or waiver of the following
conditions on or prior to the Closing Date:
(a) On the Closing Date, the Initial Purchasers shall
have received the opinion, dated as of the Closing Date and addressed
to the Initial Purchasers, of ▇▇▇▇▇▇, Hall & ▇▇▇▇▇▇▇, counsel for the
Company, in form and substance reasonably satisfactory to counsel to
the Initial Purchasers, dated the Closing Date, substantially to the
effect that:
(i) The Company and each of the Significant
Subsidiaries has been duly organized, is validly existing and is in
good standing as a corporation, limited partnership or limited
liability company, as the case may be, under the laws of its
jurisdiction of incorporation or formation, with all requisite
corporate or partnership power and authority to own, lease and operate
its properties and conduct its business as, to such counsel's
knowledge, now conducted, and as described in the Final Memorandum;
each of the Company and the Significant Subsidiaries is duly qualified
to do business as a foreign corporation, limited partnership or limited
liability company in good standing in those jurisdictions set forth on
an annex to such opinion.
(ii) To such counsel's knowledge, the Company,
directly or indirectly, owns all of the outstanding capital stock or
other equity interests of the Significant Subsidiaries. The Company's
authorized capital stock is as set forth in the Offering Memorandum. To
such counsel's knowledge, all of the outstanding shares of capital
stock of the corporate Significant Subsidiaries as of the Closing Date
are duly authorized and validly issued, are fully paid and
nonassessable and were not issued in violation of any preemptive or
similar rights; except as set forth in the Final Memorandum, to the
knowledge of such counsel, there are no (i) options, warrants or other
rights to purchase
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from the Significant Subsidiaries, (ii) agreements or other obligations
of the Significant Subsidiaries to issue or (iii) other rights to
convert any obligation into, or exchange any securities for, shares of
capital stock of, or other equity securities in, the Significant
Subsidiaries outstanding.
(iii) The Company has all requisite corporate power
and authority to execute, deliver and perform its obligations under the
Notes. The Global Note (as such term is defined in the Indenture) is in
the form contemplated by the Indenture. The Global Note has been duly
and validly authorized, executed and delivered by the Company and, when
authenticated by the Notes Trustee in accordance with the provisions of
the Indenture and when delivered to and paid for by the Initial
Purchasers in accordance with the terms of this Agreement, will
constitute valid and legally binding obligations of the Company, will
be entitled to the benefits of the Indenture and will be enforceable
against the Company in accordance with its terms, except as the
enforceability thereof may be limited by bankruptcy, insolvency,
reorganization, fraudulent transfer or conveyance or other similar laws
affecting the enforcement of creditors' rights generally and by general
equitable principles (regardless of whether the issue of enforceability
is considered in a proceeding in equity or at law).
(iv) The Company and each applicable Significant
Subsidiary has all requisite corporate or partnership power and
authority to execute, deliver and perform their obligations under the
Indenture. The Indenture meets the requirements for qualification under
the TIA. The Indenture has been duly and validly authorized, executed
and delivered by the Company and each applicable Significant Subsidiary
and constitutes a valid and legally binding agreement of the Company
and each applicable Significant Subsidiary, enforceable against the
Company and each applicable Significant Subsidiary in accordance with
its terms, except as the enforceability thereof may be limited by
bankruptcy, insolvency, reorganization, fraudulent transfer or
conveyance or other similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles
(regardless of whether the issue of enforceability is considered in a
proceeding in equity or at law).
(v) The Exchange Notes and the Private Exchange Notes
have been duly and validly authorized by the Company, and when the
Exchange Notes have been duly executed and delivered by the Company and
authenticated by the Notes Trustee in accordance with the terms of the
Registration Rights Agreement and the Indenture, will constitute the
valid and legally binding obligations of the Company, entitled to the
benefits of the Indenture, and enforceable against the Company in
accordance with their terms, except as the enforceability thereof may
be limited by bankruptcy, insolvency, reorganization, fraudulent
transfer or conveyance or other similar laws affecting the enforcement
of creditors' rights generally and by general equitable principles
(regardless of whether the issue of enforceability is considered in a
proceeding in equity or at law);
(vi) The Company and each applicable Significant
Subsidiary has all requisite corporate or partnership power and
authority to execute, deliver and perform its obligations under the
Registration Rights Agreement. The Registration Rights Agreement has
been duly and validly authorized, executed and delivered by the Company
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and each applicable Significant Subsidiary and constitutes a valid and
legally binding agreement of the Company and each applicable
Significant Subsidiary enforceable against the Company and each
applicable Significant Subsidiary in accordance with its terms, except
(A) as the enforceability thereof may be limited by bankruptcy,
insolvency, reorganization, fraudulent transfer or conveyance or other
similar laws affecting the enforcement of creditors' rights generally
and by general equitable principles (regardless of whether the issue of
enforceability is considered in a proceeding in equity or at law), and
(B) that any rights to indemnity or contribution thereunder may be
limited by federal or state securities laws or public policy
considerations.
(vii) Each applicable Significant Subsidiary has all
requisite corporate or partnership power and authority to execute,
deliver and perform its obligations under its respective Note
Guarantee. Each Note Guarantee has been duly and validly authorized,
executed and delivered by the applicable Significant Subsidiary and
constitutes a valid and legally binding agreement of such Significant
Subsidiary enforceable against such applicable Significant Subsidiary
in accordance with its terms, except as the enforceability thereof may
be limited by bankruptcy, insolvency, reorganization, fraudulent
transfer or conveyance or other similar laws affecting the enforcement
of creditors' rights generally and by general equitable principles
(regardless of whether the issue of enforceability is considered in a
proceeding in equity or at law).
(viii) Each applicable Significant Subsidiary
providing security for the Notes has all requisite corporate or
partnership and authority to execute, deliver and perform its
obligations under its respective Mortgages. Each Mortgage has been duly
and validly authorized, executed and delivered by the applicable
Significant Subsidiary.
(ix) The Company and each applicable Significant
Subsidiary has all requisite corporate power and authority to execute,
deliver and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby. This Agreement has
been duly and validly authorized, executed and delivered by the Company
and each applicable Significant Subsidiary.
(x) No consent, approval, authorization or order of
any court or governmental agency or body or, to the knowledge of such
counsel, third party is required for the execution, delivery or
performance by the Company or any applicable Significant Subsidiary of
this Agreement, the Notes, the Exchange Notes, the Note Guarantees, the
Mortgages, the Registration Rights Agreement or the Indenture or the
consummation by the Company or any of the applicable Significant
Subsidiaries of the transactions contemplated hereby or thereby that
are to be completed prior to or on the date hereof, except such as have
been obtained or disclosed in the Final Memorandum and such as may be
required under state securities or "Blue Sky" laws in connection with
the purchase and resale of the Notes by the Initial Purchasers and such
as may be necessary in connection with the Mortgages and any security
interests provided to the Notes Trustee for the benefit of the holders
of the Notes. Such counsel may note that the Company will be required
to make certain securities law filings following the Closing Date in
connection with the transactions contemplated hereby.
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(xi) The execution, delivery and performance by the
Company and the applicable Significant Subsidiaries of this Agreement,
the Notes, the Exchange Notes, the Private Exchange Notes, the
Mortgages, the Note Guarantees, the Indenture and the Registration
Rights Agreement and the consummation by the Company and the applicable
Significant Subsidiaries of the transactions contemplated hereby and
thereby, and the fulfillment of the terms thereof, will not conflict
with or constitute or result in a breach of or a default under (or an
event which with notice or passage of time or both would constitute a
default under) or violation of any of (i) to the knowledge of such
counsel and assuming that the net proceeds of the Notes will be used as
set forth in the Final Memorandum and that, except as indicated in the
Final Memorandum, all credit facilities and loan agreements and related
documents of the Company and the Significant Subsidiaries will be paid
in full (including any applicable prepayment penalties), and terminated
as of the Closing Date, the terms or provisions of any Contract to
which the Company or the applicable Significant Subsidiary is a party
or to which it is bound, except such conflicts, breaches, defaults or
violations, that would not, individually or in the aggregate, have a
Material Adverse Effect, (ii) the certificate of incorporation or
by-laws (or similar organizational document) of the Company or any of
the Significant Subsidiaries, or (iii) to the knowledge of such
counsel, any statute, judgment, decree, order, rule or regulation
applicable to the Company or any of the Significant Subsidiaries or any
of their respective properties or assets except such conflicts,
breaches, defaults or violations that would not, individually or in the
aggregate, have a Material Adverse Effect.
(xii) Neither the Company nor any of the applicable
Significant Subsidiaries is or immediately after the sale of the Notes
to be sold hereunder and the application of the proceeds from such sale
(as described in the Final Memorandum under the caption "Use of
Proceeds") will be an "investment company" or a company controlled by
an investment company within the meaning of the Investment Company Act
of 1940, as amended, and the rules and regulations thereunder.
(xiii) The Notes, the Exchange Notes, the Note
Guarantees, the Mortgages, the Registration Rights Agreement and the
Indenture conform in all material respects to the descriptions thereof
in the Final Memorandum.
(xiv) To the knowledge of such counsel, no holder of
securities of the Company nor any of the Subsidiaries will be entitled
to have such securities registered under the registration statements
required to be filed by the Company pursuant to the Registration Rights
Agreement other than as expressly permitted thereby.
(xv) The Notes satisfy the eligibility requirements
of Rule 144A(d)(3) under the Act.
(xvi) No registration under the Act of the Notes and
no qualification of the Indenture under the TIA is required in
connection with the sale of the Notes to the Initial Purchasers or the
initial resale of the Notes by the Initial Purchasers in the manner
contemplated by this Agreement and the Final Memorandum, it being
understood that no opinion is expressed as to any subsequent resale of
the Notes in each case assuming (i) that the purchasers who buy such
Notes in the initial resale thereof are qualified institutional buyers
as defined in Rule 144A promulgated under the Act ("QIBs"), and
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acquire the Notes in a transaction pursuant to Rule 144A, and (ii) the
accuracy of the representations and warranties of the Initial
Purchasers and due performance by the Initial Purchasers of the
agreements in each case as set forth in Section 8 hereof.
In rendering such opinion, such counsel may (A) state
that such counsel's opinion is limited to the federal law of the United
States and the laws of the Commonwealth of Massachusetts and the
General Corporation Law of the State of Delaware, (B) rely as to
matters involving the application of laws of the State of New York,
upon the opinion of ▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇, counsel for the Initial
Purchasers and (C) as to matters of fact, to the extent they deem
proper, on certificates of responsible officers of the Company and
public officials and the representations and warranties contained in
this Agreement. It is understood that such counsel need not express any
opinion as to the content of or effect on the Company or any
Subsidiary, or the application to this Agreement or any other agreement
contemplated hereby or the transactions contemplated hereby or thereby
of any law, statute, rule or regulation relating to the acquisition,
development, sale, financing, registration, licensing or similar matter
relating to real estate or timeshare interests. Such counsel has not
acted, and does not act, as counsel to the Company or any of its
Subsidiaries in connection with any of such matters. In addition to the
foregoing, such counsel shall state that is has participated in
conferences with executive officers and other representatives of the
Company, representatives of the Company's independent public
accountants, the Initial Purchasers and counsel for the Initial
Purchasers, at which conferences the contents of the Final Memorandum
and related matters were discussed, and although such counsel has not
independently verified and has not passed upon or assumed any
responsibility for the accuracy, completeness or fairness of the
statements contained in the Final Memorandum, and on the basis of the
foregoing no facts have come to such counsel's attention to lead it to
believe that the Final Memorandum and any further amendments or
supplements thereto as of their respective dates and on the date of
such opinion letter contained or contains an untrue statement of a
material fact or omitted or omits to state a material fact, necessary
to make the statements therein, in light of the circumstances under
which they were made, not misleading (it being understood that such
counsel need not express any view with respect to the financial
statements (including the notes thereto), financial statement schedules
and the other financial data included in the Final Memorandum). The
opinion of ▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇ described in this Section shall be
rendered to the Initial Purchasers at the request of the Company and
shall so state therein.
(b) On the Closing Date, the Initial Purchasers shall
have received opinions, in form and substance reasonably satisfactory
to the Initial Purchasers, dated as of the Closing Date and addressed
to the Initial Purchasers:
(i) of counsel licensed in each state in which any of
the Pledged Properties are located. Such opinions shall cover such
matters as are reasonably requested by the Initial Purchasers,
including the following: (A) each Mortgage, when filed in the
appropriate recording office, will constitute a valid first lien on the
Pledged Property identified therein, subject only to the lien of taxes
and assessments not yet due and payable, and such covenants,
conditions, and restrictions of record (other than liens for the
payment of money) as existed at the time of acquisition thereof by the
▇▇▇▇▇▇▇▇▇
▇▇
▇▇
Subsidiary executing the Mortgage and such other covenants, conditions,
and restrictions of record thereafter executed by, or consented to by,
the Subsidiary Guarantor executing the Mortgage which do not adversely
affect the marketability of title to, or the value of, such Pledged
Property; (B) the Mortgages in such state are the legal, valid and
binding obligations of the Subsidiary Guarantors executing the same,
enforceable in accordance with their terms except as the enforceability
thereof may be limited by bankruptcy, insolvency, reorganization,
fraudulent transfer or conveyance or other similar laws affecting the
enforcement of creditors' rights generally and by general equitable
principles (regardless of whether the issue of enforceability is
considered in a proceeding in equity or at law); (C) execution of the
Mortgages does not violate the usury laws of the state in which the
Pledged Properties are located; (D) the execution, delivery and
performance by the Subsidiary Guarantors under the Mortgages do not
conflict with, or constitute a default, violation or breach of, any
applicable law or governmental rule or regulation, or, to the best of
counsel's knowledge, any order, injunction or decree of any court or
governmental instrumentality applicable to the Subsidiary Guarantors or
the Pledged Properties; (E) no fees, taxes or other charges, including,
without limitation, intangible, documentary, stamp, mortgage, transfer
or recording taxes or similar charges are payable to such state or to
any jurisdiction therein solely on account of the creation of the
indebtedness and obligations secured by the Mortgages, the creation of
the liens thereunder, or the filing, recording or registration of the
Mortgages, except for insubstantial filing or recording fees; (F) the
Mortgages are in proper form for filing for record with the applicable
filing office; (G) upon filing for record of the Mortgages in the real
property records of the counties in which the Pledged Properties are
located, the mortgagee thereof will have a mortgage lien upon the
Pledged Properties; (H) with respect to the opinion of Montana counsel,
that Bluegreen Corporation of Montana is duly organized, validly
existing, and in good standing under the laws of Montana, has full
power and authority to execute, deliver and perform the Mortgages, that
the execution, delivery and performance of the Mortgages have been duly
authorized and that the persons executing the Mortgages have been duly
authorized to do so; and (H) with respect to the opinion of Idaho
counsel, that Bluegreen Corporation of Montana is qualified to do
business as a foreign corporation in Idaho and is in good standing
under the laws of Idaho.
In rendering such opinions, such counsel may (A)
state that such counsel's opinion is limited to the federal law of the
United States and the laws of the states in which the Pledged
Properties are located, (B) assume (except as to any Subsidiary
Guarantor organized under the laws of such state) that the Subsidiary
Guarantor is validly existing under the laws of the state of its
organization, has full power and authority to execute, deliver and
perform the Mortgages, and that the execution, delivery, and
performance of the Mortgages has been duly authorized, and that the
persons executing the Mortgages on behalf of the Subsidiary Guarantor
has been duly authorized to do so, (C) as to matters of fact, to the
extent they deem proper, such counsel may rely upon certificates of
responsible officers of the Company and the Subsidiary Guarantors.
(ii) of ▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇ counsel for the
Initial Purchasers, with respect to certain legal matters relating to
this Agreement and such other related
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matters as the Initial Purchasers may reasonably require. In rendering
such opinion, ▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇ shall have received and may
rely upon such certificates and other documents and information as they
may reasonably request to pass upon such matters.
(c) On the Closing Date, the Initial Purchasers shall
have received:
(i) long-form good standing certificates for the
Company and the Subsidiaries dated as of a date within ten (10)
business days prior to the Closing Date, and bring-down good standing
certificates dated the Closing Date;
(ii) Foreign qualification certificates for the
Company and the Subsidiaries dated as of a date within ten (10)
business days prior to the Closing Date, from the Secretary of State of
each State in which any of the Company or the Subsidiaries is required
to be qualified as a foreign corporation.
(d) On the Closing Date, the Initial Purchasers shall
have received the following documents duly authorized, executed and
delivered by each of the parties thereto, in form and substance
satisfactory for counsel to the Initial Purchasers, dated the Closing
Date:
(i) the Note Guarantees;
(ii) the Indenture;
(iii) the Registration Rights Agreement; and
(iv) the Mortgages and such affidavits,
certifications, and documentation as may be
necessary in order to record the Mortgages
in the jurisdictions in which the Pledged
Properties to which they relate are located.
(e) The Initial Purchasers shall have received from
Ernst & Young LLP comfort letters dated the date hereof and the Closing
Date, in form and substance satisfactory to counsel for the Initial
Purchasers, which describe the procedures as the Initial Purchasers may
request and Ernst & Young LLP are willing to perform and report upon.
(f) The representations and warranties of the Company
and the Subsidiaries contained in this Agreement shall be true and
correct on and as of the date hereof and on and as of the Closing Date
as if made on and as of the Closing Date; the statements of the
Company's or any Subsidiaries' officers made pursuant to any
certificate delivered in accordance with the provisions hereof shall be
true and correct on and as of the date made and on and as of the
Closing Date; the Company and the Subsidiaries shall have performed all
covenants and agreements and satisfied all conditions on their part to
be performed or satisfied hereunder at or prior to the Closing Date.
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(g) The sale of the Notes hereunder shall not be
enjoined (temporarily or permanently) on the Closing Date.
(h) The Notes shall have been approved by the NASD
for trading in the PORTAL Market.
(i) There shall not have occurred any invalidation of
Rule 144A under the Act by any court or any withdrawal or proposed
withdrawal of any rule or regulation under the Act or the Exchange Act
by the Commission or any amendment or proposed amendment thereof by the
Commission which in the judgment of the Initial Purchasers would
materially impair the ability of the Initial Purchasers to purchase,
hold or effect resales of the Notes as contemplated hereby.
(j) There shall not have occurred any change, or any
development involving a prospective change, in the general business
affairs, condition (financial or otherwise), prospects or results of
operations, of the Company and the Subsidiaries, taken as a whole, from
that set forth in the Final Memorandum that constitutes, or is
reasonably likely to constitute, a Material Adverse Effect and that
makes it, in the Initial Purchasers' judgment, impracticable to market
the Notes on the terms and in the manner contemplated in the Final
Memorandum.
(k) Subsequent to the date of the most recent
financial statements in the Final Memorandum (exclusive of any
amendment or supplement thereto after the date hereof), the conduct of
the business and operations of the Company and the Subsidiaries shall
not have been interfered with by strike, fire, flood, hurricane,
accident or other calamity (whether or not insured) or by any court or
governmental action, order or decree, and, except as otherwise stated
therein, the properties of the Company and the Subsidiaries shall not
have sustained any loss or damage (whether or not insured) as a result
of any such occurrence, except any such interference, loss or damage
which would not, individually or in the aggregate, have a Material
Adverse Effect.
(l) No securities of the Company or any Subsidiary
shall have been downgraded or placed on any "watch list" for possible
downgrading by any nationally recognized statistical rating
organization.
(m) The Initial Purchaser shall have received a
certificate of the Company, dated the Closing Date, signed by its
President and the Chief Financial Officer, to the effect that:
(i) The representations and warranties of the Company
and the Subsidiaries contained in this Agreement are true and correct
as of the date hereof and as of the Closing Date, and the Company and
the Subsidiaries have performed all covenants and agreements and
satisfied all conditions on their part to be performed or satisfied
hereunder at or prior to the Closing Date;
(ii) At the Closing Date, since the date hereof or
since the date of the most recent financial statements in the Final
Memorandum (exclusive of any amendment
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or supplement thereto after the date hereof), no event or events have
occurred, no information has become known and no condition exists that,
individually or in the aggregate, has had, or could reasonably be
expected to have, a Material Adverse Effect; and
(iii) Neither the Preliminary Memorandum as of the
date thereof nor the Final Memorandum nor any amendment or supplement
thereto as of the date thereof and, in the case of the Final Memorandum
and any amendment or supplement thereto, at all times subsequent
thereto up to the Closing Date, contained or contains any untrue
statement of a material fact or omitted or omits to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(n) The Initial Purchasers shall have received
certificates from:
(i) the corporate clerk of the Company, dated the
Closing Date, attaching certified copies of (A) all resolutions of the
Board of Directors of the Company authorizing the transactions
contemplated by this Agreement, including, without limitation,
approving the offering of the Notes, the entering into this Agreement,
the Indenture and the Registration Rights Agreement and (B) the
articles of organization and by-laws of the Company and certifying the
incumbency, names and true signatures of the officers of the Company;
(ii) the corporate secretary or clerk of each
Guarantor Subsidiary, dated the Closing Date, attaching certified
copies of (A) all resolutions of the Board of Directors or similar
governing body of such Guarantor Subsidiary authorizing the
transactions contemplated by this Agreement, including, without
limitation, approving the execution of the Note Guarantees, the
entering into of this Agreement, the Indenture and the Registration
Rights Agreement and (B) the charter documents and by-laws of such
Guarantor Subsidiary and certifying the incumbency, names and true
signatures of the officers of such Guarantor Subsidiary.
On or before the Closing Date, the Initial Purchasers
and counsel for the Initial Purchasers shall have received such further
documents, opinions, certificates, letters and schedules or instruments relating
to the business, corporate, legal and financial affairs of the Company and the
Subsidiaries as they shall have theretofore reasonably requested from the
Company and the Subsidiaries.
All such documents, opinions, certificates, letters,
schedules or instruments delivered pursuant to this Agreement will comply with
the provisions hereof only if they are reasonably satisfactory in all material
respects to the Initial Purchasers and counsel for the Initial Purchasers. The
Company and the Subsidiaries shall furnish to the Initial Purchasers such
conformed copies of such documents, opinions, certificates, letters, schedules
and instruments in such quantities as the Initial Purchasers shall reasonably
request.
8. OFFERING OF NOTES; RESTRICTIONS ON TRANSFER. Each Initial
Purchaser agrees with the Company that (i) it has not and will not solicit
offers for, or offer or sell, the Notes by
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any form of general solicitation or general advertising (as those terms are used
in Regulation D under the Act) or in any manner involving a public offering
within the meaning of Section 4(2) of the Act; (ii) it has and will solicit
offers for the Notes only from, and will offer the Notes only to persons (A)
whom such Initial Purchaser reasonably believes to be QIBs or, if any such
person is buying for one or more institutional accounts for which such person is
acting as fiduciary or agent, only when such person has represented to such
Initial Purchaser that each such account is a QIB, to whom notice has been given
that such sale or delivery is being made in reliance on Rule 144A, and, in each
case, in transactions under and in compliance with Rule 144A and (B) who
received a copy of the Preliminary Memorandum prior to March 12, 1998.
Each Initial Purchaser represents and warrants that it is an
Accredited Investor (as such term is defined in Regulation D under the Act),
with such knowledge and experience in financial and business matters as are
necessary in order to evaluate the merits and risks of an investment in the
Notes. Each Initial Purchaser acknowledges that the Notes have not been
registered under the Act and may only be sold if registered or pursuant to an
exemption. Each Initial Purchaser agrees to comply with the applicable
provisions of Rule 144A and Rule 144 under the Act. Each Initial Purchaser
hereby acknowledges that the Company and, for purposes of the opinions to be
delivered to the Initial Purchasers pursuant to Section 7(a) hereof, counsel to
the Company will rely upon the accuracy and truth of the representations
contained in this Section 8 and each Initial Purchaser hereby consents to such
reliance.
9. INDEMNIFICATION AND CONTRIBUTION. (a) Each of the Company
and the Subsidiaries agrees to indemnify and hold harmless the Initial
Purchasers and their respective affiliates, directors, officers, agents,
representatives, general partners and employees, and each other person, if any,
who controls such Initial Purchaser or its affiliates within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, to the full extent
lawful against any losses, claims, damages, expenses or liabilities (or actions
in respect thereof, including, without, limitation, shareholder derivative
actions and arbitration proceedings) to which any Initial Purchaser or such
other person may become subject under the Act, the Exchange Act or otherwise,
insofar as any such losses, claims, damages, expenses or liabilities (or actions
in respect thereof) arise out of or are based upon: (i) any untrue statement or
alleged untrue statement of any material fact contained in any Memorandum or any
amendment or supplement thereto or any application or other document, or any
amendment or supplement thereto, executed by the Company or any Subsidiary or
based upon written information furnished by or on behalf of the Company or any
Subsidiary filed with any securities association or securities exchange (each an
"Application"); (ii) the omission or alleged omission to state, in any
Memorandum or any amendment or supplement thereto or any Application, a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances in which made, not misleading; or (iii) any breach
of any of the representations and warranties of the Company or any Subsidiary
set forth in this Agreement, the Indenture, the Registration Rights Agreement,
the Mortgages, and the Note Guarantees, and, subject to the provisions thereof,
will reimburse, as incurred, the Initial Purchasers and each such other person
for any reasonable legal or other expenses incurred by the Initial Purchasers or
such other person in connection with investigating, defending against or
appearing as a third-party witness in connection with any such loss, claim,
damage, liability or action; provided, however, neither the Company nor any
Subsidiary will be liable in any such case to the extent that any such loss,
claim, damage, or liability arises out of or is based upon any untrue statement
or alleged untrue statement or omission or alleged omission
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26
made in any Memorandum or any amendment or supplement thereto or any Application
in reliance upon and in conformity with written information furnished to the
Company by or on behalf of the Initial Purchasers specifically for use therein.
This indemnity agreement will be in addition to any liabilities or obligations
that the Company or any Subsidiary may otherwise have to the indemnified
parties. Subject to Section 9(c), neither the Company nor any Subsidiary shall
not be liable under this Section 9 for any settlement of any claim or action
effected without their prior consent, which shall not be unreasonably withheld.
The Company and the Subsidiaries shall not, without the prior written consent of
the Initial Purchasers, effect any settlement or compromise of any pending or
threatened proceeding in respect of which the Initial Purchasers are or could
have been a party, or indemnity could have been sought hereunder by the Initial
Purchasers, unless such settlement (A) includes an unconditional written release
of the Initial Purchasers in form and substance reasonably satisfactory to the
Initial Purchasers, from all liability on claims that are the subject matter of
such proceeding and (B) does not include any statement as to an admission of
fault, culpability or failure to act by or on behalf of the Initial Purchasers.
(b) The Initial Purchasers severally and not jointly agree to
indemnify and hold harmless the Company, the Subsidiaries, their
directors, officers, affiliates, agents, representatives and employees
and each person, if any, who controls the Company or any Subsidiary
within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act to the fullest extent lawful against any losses, claims,
damages, expenses or liabilities (or actions in respect thereof,
including, without limitation, shareholder derivative suits and
arbitration proceedings) to which the Company, any Subsidiary or any
such other person may become subject under the Act, the Exchange Act or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon (i) any
untrue statement or alleged untrue statement of any material fact
contained in any Memorandum or any amendment or supplement thereto or
any Application, or (ii) the omission or the alleged omission to state
therein a material fact required to be stated in any Memorandum or any
amendment or supplement thereto or any Application, or necessary to
make the statements therein not misleading, in each case to the extent,
but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and
in conformity with written information furnished to the Company or on
behalf of the Initial Purchasers specifically for use therein; and
subject to the limitation set forth immediately preceding this clause,
will reimburse, as incurred, any reasonable legal or other expenses
incurred by the Company, any Subsidiary, or any such other person in
connection with investigating or defending against or appearing as a
third party witness in connection with any such loss, claim, damage,
liability or action. This indemnity agreement will be in addition to
any liabilities or obligations that the Initial Purchasers may
otherwise have to the indemnified parties. Subject to Section 9(c), the
Initial Purchasers shall not be liable under this Section 9 for any
settlement of any claim or action effected without their written
consent, which shall not be unreasonably withheld. The Initial
Purchasers shall not, without the prior written consent of the Company,
effect any settlement or compromise of any pending or threatened
proceeding in respect of which the Company or the Subsidiaries are or
could have been a party, or indemnity could have been sought hereunder
by the Company or the Subsidiaries, unless such settlement (A) includes
an unconditional written release of the Company and the Subsidiaries,
in form and substance
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reasonably satisfactory to such person, from all liability on claims
that are the subject matter of such proceeding and (B) does not include
any statement as to an admission of fault, culpability or failure to
act by or on behalf of the Company or the Subsidiaries.
(c) Promptly after receipt by an indemnified party under this
Section 9 of notice of the commencement of any action for which such
indemnified party is entitled to indemnification under this Section 9,
such indemnified party will, if a claim in respect thereof is to be
made against the indemnifying party under this Section 9, notify the
indemnifying party of the commencement thereof in writing; but the
omission to so notify the indemnifying party (i) will not relieve it
from any liability under paragraph (a) or (b) above unless and to the
extent such failure results in the forfeiture by the indemnifying party
of substantial rights and defenses and (ii) will not, in any event,
relieve the indemnifying party from any obligations to any indemnified
party other than the indemnification obligation provided in paragraphs
(a) and (b) above. In case any such action is brought against any
indemnified party, and it notifies the indemnifying party of the
commencement thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish, jointly with
any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified
party; provided, however, that if (i) the use of counsel chosen by the
indemnifying party to represent the indemnified party would present
such counsel with a conflict of interest, (ii) the defendants in any
such action include both the indemnified party and the indemnifying
party and the indemnified party shall have been advised by counsel that
there may be one or more legal defenses available to it and/or other
indemnified parties that are different from or additional to those
available to the indemnifying party, or (iii) the indemnifying party
shall not have employed counsel reasonably satisfactory to the
indemnified party to represent the indemnified party within a
reasonable time after receipt by the indemnifying party of notice of
the institution of such action, then, in each such case, the
indemnifying party shall not have the right to direct the defense of
such action on behalf of such indemnified party or parties and such
indemnified party or parties shall have the right to select separate
counsel to defend such action on behalf of such indemnified party or
parties. After notice from the indemnifying party to such indemnified
party of its election so to assume the defense thereof and approval by
such indemnified party of counsel appointed to defend such action, the
indemnifying party will not be liable to such indemnified party under
this Section 9 for any legal or other expenses, other than reasonable
costs of investigation, subsequently incurred by such indemnified party
in connection with the defense thereof, unless (i) the indemnified
party shall have employed separate counsel in accordance with the
proviso to the immediately preceding sentence (it being understood,
however, that in connection with such action the indemnifying party
shall not be liable for the expenses of more than one separate counsel
(in addition to local counsel) in any one action or separate but
substantially similar actions in the same jurisdiction arising out of
the same general allegations or circumstances designated by the Initial
Purchaser in the case of paragraph (a) of this Section 9 or either the
Company or any of the Subsidiaries in the case of paragraph (b) of this
Section 9, representing the indemnified parties under such paragraph
(a) or paragraph (b), as the case may be, who are parties to such
action or actions) or (ii) the indemnifying party has authorized in
writing the employment of counsel for the indemnified party at the
expense of the indemnifying party. After such notice from the
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indemnifying party to such indemnified party, the indemnifying party
will not be liable for the costs and expenses of any settlement of such
action effected by such indemnified party without the prior written
consent of the indemnifying party, unless such indemnified party waived
in writing its rights under this Section 9, in which case the
indemnified party may effect such a settlement without such consent.
(d) In circumstances in which the indemnity agreement provided
for in the preceding paragraphs of this Section 9 is unavailable to an
indemnified party in respect of any losses, claims, damages or
liabilities (or actions in respect thereof), each indemnifying party,
in order to provide for just and equitable contribution, shall
contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages or liabilities (or actions in
respect thereof) in such proportion as is appropriate to reflect (i)
the relative benefits received by the indemnifying party or parties on
the one hand and the indemnified party on the other from the offering
of the Notes or (ii) if the allocation provided by the foregoing clause
(i) is not permitted by applicable law, not only such relative benefits
but also the relative fault of the indemnifying party or parties on the
one hand and the indemnified party on the other in connection with the
statements or omissions or alleged statements or omissions or breaches
that resulted in such losses, claims, damages or liabilities (or
actions in respect thereof). The relative benefits received by the
Company and the Subsidiaries on the one hand and the Initial Purchasers
on the other shall be deemed to be in the same proportion as the total
proceeds from the offering of the Notes (net of commissions and before
deducting expenses) received by the Company or any Subsidiary bears to
the total discounts and commissions received by the Initial Purchasers.
The relative fault of the parties shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material
fact relates to information supplied by the Company or any Subsidiary
on the one hand, or the Initial Purchasers on the other, the parties'
relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission or alleged statement or
omission, and any other equitable considerations appropriate in the
circumstances. The Company, the Subsidiaries and the Initial Purchasers
agree that it would not be equitable if the amount of such contribution
were determined by pro rata or per capita allocation or by any other
method of allocation that does not take into account the equitable
considerations referred to in the first sentence of this paragraph (d).
Notwithstanding any other provision of this paragraph (d), neither
Initial Purchaser shall be obligated to make contributions hereunder
that in the aggregate exceed the total discounts, commissions and other
compensation received by such Initial Purchaser under this Agreement,
less the aggregate amount of any damages that such Initial Purchaser
has otherwise been required to pay by reason of the untrue or alleged
untrue statements or the omissions or alleged omissions to state a
material fact, and no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this paragraph (d), each person, if
any, who controls an Initial Purchaser within the meaning of Section 15
of the Act or Section 20 of the Exchange Act shall have the same rights
to contribution as the Initial Purchasers, and each director of the
Company or any Subsidiary, each officer of the Company or any
Subsidiary and each person, if any, who controls the Company or any
Subsidiary within the meaning of Section 15 of the Act
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or Section 20 of the Exchange Act shall have the same rights to
contribution as the Company and such Subsidiary.
10. SURVIVAL CLAUSE. The respective representations,
warranties, agreements, covenants, indemnities and other statements of the
Company, the Subsidiaries, their respective officers and the Initial Purchasers
set forth in this Agreement or made by or on behalf of them pursuant to this
Agreement shall remain in full force and effect, regardless of (i) any
investigation made by or on behalf of the Company, the Subsidiaries, any of
their respective officers or directors, the Initial Purchasers or any other
person referred to in Section 9 hereof and (ii) delivery of and payment for the
Notes. The respective agreements, covenants, indemnities and other statements
set forth in Sections 6, 9 and 15 hereof shall remain in full force and effect,
regardless of any termination or cancellation of this Agreement.
11. TERMINATION. (a) This Agreement may be terminated in the
sole discretion of the Initial Purchasers by notice to the Company given on or
prior to the Closing Date in the event that the Company shall have failed,
refused or been unable to perform all obligations and satisfy all conditions on
its part to be performed or satisfied hereunder at or prior thereto or, if at or
prior to the Closing Date any of the following shall have occurred:
(i) any of the Company or the Subsidiaries shall have
sustained any loss or interference with respect to its businesses or
properties from fire, flood, earthquakes, hurricane, accident or other
calamity, whether or not covered by insurance, or from any strike,
labor dispute, slow down or work stoppage or any legal or governmental
proceeding, which loss or interference has had or could be likely to
have a Material Adverse Effect, or there shall have been, in the sole
judgment of the Initial Purchasers, any other event or development
that, individually or in the aggregate, has or could be reasonably
likely to have a Material Adverse Effect (including without limitation
a change in control of the Company or the Subsidiaries), except in each
case as described in the Final Memorandum (exclusive of any amendment
or supplement thereto);
(ii) there shall have occurred any change, or any
development involving a prospective change, in the condition, financial
or otherwise, or in the earnings, business, operations or prospects of
the Company and the Subsidiaries, taken as a whole, from that set forth
in the Final Memorandum that is material and adverse and that makes it,
in the sole judgment of the Initial Purchasers, impracticable to market
the Notes on the terms and in the manner contemplated in the Final
Memorandum;
(iii) trading generally shall have been suspended or
materially limited on or by, as the case may be, either of the New York
Stock Exchange or the National Association of Securities Dealers, Inc.
or the setting of minimum prices for trading on such exchange or market
shall have occurred or trading of any securities of the Company or the
Subsidiaries shall have been suspended on any exchange or in any
over-the-counter market;
(iv) a banking moratorium shall have been declared by
New York, Massachusetts, Florida or United States authorities;
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(v) there shall have been (A) an outbreak or
escalation of hostilities between the United States and any foreign
power, (B) an outbreak or escalation of any other insurrection or armed
conflict involving the United States, (C) any material adverse change
in the financial markets of the United States or (D) any other national
or international calamity or emergency which, in the case of (A), (B),
(C) or (D) above and in the sole judgment of the Initial Purchasers,
makes it impracticable or inadvisable to proceed with the offering or
the delivery of the Notes as contemplated by the Final Memorandum;
(vi) the taking of any action by any federal, state
or local government or agency in respect of its monetary or fiscal
affairs that has a material adverse effect on the financial markets in
the United States, and would, in the sole judgment of the Initial
Purchasers, make it impracticable or inadvisable to market the Notes;
(vii) the proposal, enactment, publication, decree,
or other promulgation of any federal or state statute, regulation, rule
order of any court or other governmental authority which, in the sole
judgment of the Initial Purchasers, would have a Material Adverse
Effect; or
(viii) any securities of the Company or any
Subsidiary shall have been downgraded or placed on any "watch list" for
possible downgrading by any nationally recognized statistical rating
organization.
(b) Termination of this Agreement pursuant to this
Section 11 shall be without liability of any party to any other party
except as provided in this Section 11 and Section 10 hereof.
If this Agreement shall be terminated by the Initial
Purchasers because of any failure or refusal on the part of the Company to
comply with the terms or to fulfill any of the conditions of this Agreement, or
if for any reason the Company shall be unable to perform its obligations under
this Agreement or any condition of the purchasers, obligations cannot be
fulfilled, the Company agrees to reimburse the Initial Purchasers for all
out-of-pocket expenses (including the reasonable fees and expenses of their
counsel) reasonably incurred by such Initial Purchasers in connection with this
Agreement or the offering contemplated hereunder; provided, however, that the
Company shall have no obligation under this Section if this Agreement is
terminated by reason of the failure of Initial Purchasers' counsel to deliver
the opinion referred to in Section 7(b). It is understood that, if this
Agreement is terminated pursuant to this Section 11, the Initial Purchasers
shall not have any right to bring a claim against the Company or any Subsidiary
for their benefit of the bargain.
12. INFORMATION SUPPLIED BY THE INITIAL PURCHASERS. The
statements set forth in the last paragraph on the cover page of the Final
Memorandum and paragraphs 5, 6 and 7 under the heading "Plan of Distribution" in
the Final Memorandum (to the extent such statements relate to the Initial
Purchasers) constitute the only information furnished by the Initial Purchasers
to the Company for the purposes of Sections 2(a) and 9 hereof.
30
31
13. NOTICES. All communications hereunder shall be in writing
and, if sent to the Initial Purchasers, shall be mailed or delivered to (i)
NatWest Capital Markets Limited, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇▇, with a copy to ▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.; if sent to the
Company, shall be mailed or delivered to the Company at Bluegreen Corporation,
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, with a copy to ▇▇▇▇▇▇, ▇▇▇▇ &
▇▇▇▇▇▇▇, Exchange Place, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
All such notices and communications shall be deemed to have
been duly given: upon successful transmission if given via facsimile; when
delivered by hand, if personally delivered; five business days after being
deposited in the mail, postage prepaid, if mailed; and one business day after
being timely delivered to a next-day air courier.
14. SUCCESSORS. This Agreement shall inure to the benefit of
and be binding upon the Initial Purchasers, the Company, the Subsidiaries and
their respective successors and legal representatives, and nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any other
person any legal or equitable right, remedy or claim under or in respect of this
Agreement, or any provisions herein contained; this Agreement and all conditions
and provisions hereof being intended to be and being for the sole and exclusive
benefit of such persons and for the benefit of no other person except that (i)
the indemnities of the Company and the Subsidiaries contained in Section 9 of
this Agreement shall also be for the benefit of any person or persons who
control the Initial Purchasers within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act and the other persons set forth in Section 9 and
(ii) the indemnities of the Initial Purchasers contained in Section 9 of this
Agreement shall also be for the benefit of the directors and officers of the
Company and the Subsidiaries and any person or persons who control the Company
or any Subsidiary within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act and the other persons set forth in Section 9. No purchaser of
Notes from the Initial Purchasers will be deemed a successor because of such
purchase.
15. APPLICABLE LAW. THE VALIDITY AND INTERPRETATION OF THIS
AGREEMENT, AND THE TERMS AND CONDITIONS SET FORTH HEREIN, SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND TO BE PERFORMED WHOLLY THEREIN, WITHOUT GIVING EFFECT TO ANY
PROVISIONS THEREOF RELATING TO CONFLICTS OF LAW.
16. COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
31
32
If the foregoing correctly sets forth our understanding,
please indicate your acceptance thereof in the space provided below for that
purpose, whereupon this letter shall constitute a binding agreement among the
Company, the Guarantor Subsidiaries and the Initial Purchasers.
Very truly yours,
BLUEGREEN CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Vice President
BLUEGREEN RESORTS MANAGEMENT, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
BLUEGREEN RESORTS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
BLUEGREEN HOLDING CORPORATION
(TEXAS)
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
PROPERTIES OF THE SOUTHWEST ONE, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President
PROPERTIES OF THE SOUTHWEST, L.P.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President of Its General Partner,
PROPERTIES OF THE SOUTHWEST ONE, INC.
33
BLUEGREEN ASSET MANAGEMENT CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
BLUEGREEN CAROLINA LAND, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
BLUEGREEN CORPORATION OF MONTANA
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
BLUEGREEN CORPORATION OF TENNESSEE
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
BLUEGREEN CORPORATION OF THE ROCKIES
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
VIRGINIA LAND & FOREST CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
34
BLUEGREEN COMMUNITIES, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
BLUEGREEN RESORTS INTERNATIONAL,
INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
CAROLINA NATIONAL GOLF CLUB, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
LEISURE CAPITAL CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
PROPERTIES OF THE WEST, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
BG/RDI ACQUISITION CORP.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
35
RDI GROUP, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Secretary
DELLONA ENTERPRISES, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Secretary
RESORT DEVELOPMENT INTERNATIONAL, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Secretary
RDI RESORT SERVICES CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Secretary
RDI RESOURCES, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Secretary
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
36
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above
written.
NATWEST CAPITAL MARKETS LIMITED
By: /s/ ▇▇▇▇▇ ▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇
Title: Director
▇▇▇▇▇▇▇▇ & COMPANY SECURITIES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
Title: Senior Vice President
37
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above
written.
NATWEST CAPITAL MARKETS LIMITED
By: /s/ ▇. ▇▇▇▇
---------------------------------------
Name: ▇. ▇▇▇▇
Title: Director
▇▇▇▇▇▇▇▇ & COMPANY SECURITIES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
Title: Senior Vice President
38
SCHEDULE 1
Notes
Initial Purchaser Principal Amount
----------------- ----------------
NatWest Capital Markets Limited..................................$ 55,000,000.00
▇▇▇▇▇▇▇▇ & Company Securities, Inc...............................$ 55,000,000.00
Total............................................................$110,000,000.00
39
SCHEDULE 2
List of Subsidiaries
--------------------
Subsidiary Percentage Number and Type of
Ownership Shares
Bluegreen Asset Management 100% Common
Corp.
Bluegreen Carolina Land, Inc. 100% Common
Bluegreen Communities, Inc. 100% Common
Bluegreen Corporation Great 100% Common
Lakes (WI)
Bluegreen Corporation Gulf- 100% Common
Atlantic
Bluegreen Corporation Mid- 100% Common
Atlantic
Bluegreen Corporation 100% Common
Midland
Bluegreen Corporation of 100% Common
Canada
Bluegreen Corporation of 100% Common
Lake ▇▇▇▇▇▇▇
Bluegreen Corporation of 100% Common
Michigan
Bluegreen Corporation of 100% Common
Missouri
Bluegreen Corporation of 100% Common
Montana
Bluegreen Corporation of 100% Common
Ohio
Bluegreen Corporation of the 100% Common
Rockies
Bluegreen Corporation of 100% Common
Tennessee
Bluegreen Corporation 100% Common
▇▇▇▇▇▇▇▇▇
▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 100% Common
Corporation
Bluegreen Land and Realty, 100% Common
Inc.
Bluegreen Resorts, Inc. 100% Common
Bluegreen Resorts 100% Common
International, Inc.
Bluegreen Resorts 100% Common
Management, Inc.
BXG Realty Tenn, Inc. 100% Common
Carolina Costal Properties, 100% Common
Inc.
Carolina National Golf Club, 100% Common
Inc.
CDP Realty, Inc. 100% Common
Gulf Atlantic Land & Timber 100% Common
Corporation
Leisure Capital Corporation 100% Common
New England Advertising 100% Common
Corporation
▇▇▇▇▇▇ Corporation (DE) 100% Common
Properties of the West, Inc. 100% Common
South Florida Aviation, Inc. 100% Common
Virginia Land & Forest 100% Common
Corporation
Trading Corporation of South 100% Common
Florida
Woodland Acres, Inc. 100% Common
BG/RDI Acquisition 100% Common
Corporation
RDI Group, Inc. 100% Common
Dellona Enterprises, Inc. 100% Common
Resort Development 100% Common
International, Inc.
41
RDI Realty, Inc. 100% Common
Resort Ownership, Inc. 100% Common
RDI Vacation Club, Inc. 100% Common
RDI Resources, Inc. 100% Common
RDI Vacation Shoppe Travel, 100% Common
Inc.
Properties of the Southwest 100% Common
One, Inc.
Bluegreen Holding Corp. 100% Common
(Texas)
Properties of the Southwest, 100% Partnership Interests
L.P.
Bluegreen Aruba N.V. 50% _______
Bluegreen Receivables 100% Common
Finance Corp. III
Bluegreen Receivables 100% Common
Finance Corp. VI
Bluegreen Receivables 100% Common
Finance Corp. VII
Bluegreen Receivables 100% Common
Finance Corp. VIII
Bluegreen Receivables 100% Common
Finance Corp. IX
42
ANNEX I
Significant Subsidiaries of the Company
---------------------------------------
Bluegreen Carolina Land, Inc.
Bluegreen Corporation of Montana
Bluegreen Holding Corporation (Texas)
Bluegreen Resorts, Inc.
Properties of the West, Inc.
Properties of the Southwest, L.P.
Bluegreen Corporation of the Rockies
Virginia Land & Forest Corporation