Exhibit 1.1
$215,000,000
▇.▇. ▇▇▇▇▇▇, INC.
7.5% Senior Notes due 2007
UNDERWRITING AGREEMENT
November 22, ▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ Securities LLC
Wachovia Securities, Inc.
c/o Banc of America Securities LLC
▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
Capital Markets, 31st Floor
New York, New York 10019
Banc One Capital Markets, Inc.
1 Bank ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
▇.▇. ▇▇▇▇▇▇, Inc., a Delaware corporation (the "Company"), proposes to
issue and sell $215,000,000 aggregate principal amount of its 7.5% Senior Notes
due 2007 (the "Notes") to Banc of America Securities LLC ("Banc of America") and
Wachovia Securities, Inc. ("Wachovia"). In addition, Banc One Capital Markets,
Inc. ("Banc One," and together with Banc of America and Wachovia, the
"Underwriters") has agreed to participate as a "qualified independent
underwriter" (in such capacity, the "QIU") within the meaning of the NASD
Conduct Rules, in connection with the offering of the Notes. The Notes are to be
issued pursuant to the provisions of an Indenture dated as of June 9, 1997 as
supplemented (the "Base Indenture") and a supplemental indenture to be dated as
of December 3, 2002 (the "Supplemental Indenture" and together with the Base
Indenture, the "Indenture") among the Company, certain subsidiaries of the
Company and American Stock Transfer and Trust Company, as Trustee (the
"Trustee"). The Company's obligations under the Indenture and the Notes will be
unconditionally guaranteed (the "Guarantees"), jointly and severally, by each of
the subsidiaries of the Company listed on the signature pages hereof (the
"Guarantors"). The Company and the Guarantors are collectively referred to
herein as the "Issuers" and the Notes and the Guarantees are collectively
referred to herein as the "Securities."
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1. Registration Statement and Prospectus. The Company has prepared and
filed with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933, as amended, and
the published rules and regulations of the Commission thereunder (collectively,
the "Act"), a registration statement on Form S-3 (No. 333-84088), including a
base prospectus relating to the Securities. The registration statement as
amended at the time it became effective on March 27, 2002, including information
(if any) deemed to be part of the registration statement at the time of
effectiveness pursuant to Rule 430A under the Act, is hereinafter referred to as
the "Registration Statement"; and the base prospectus dated March 27, 2002 (the
"Base Prospectus"), as supplemented by the prospectus supplement relating to the
Securities in the form first used to confirm sales of Securities (the
"Prospectus Supplement"), is hereinafter referred to as the "Prospectus." Any
reference herein to the Registration Statement, a preliminary prospectus or the
Prospectus shall be deemed to refer to and include the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 under the Act, as of the
effective date of the Registration Statement or the date of such preliminary
prospectus or the Prospectus (the "Incorporated Documents"), and, except as
otherwise indicated, when reference is made to information "in" (including by
use of the terms "set forth in," "described in" and similar terms) the
Prospectus or the Registration Statement, such reference shall be deemed to
include information incorporated by reference in the Prospectus or the
Registration Statement, as the case may be.
2. Agreements To Sell and Purchase. The Company agrees to issue and
sell, and, on the basis of the representations and warranties contained in this
Underwriting Agreement (the "Agreement") and subject to its terms and
conditions, each of the Underwriters agree, severally and not jointly, to
purchase from the Company, the aggregate principal amount of the Notes set forth
opposite such Underwriter's name on Schedule A hereto. The aggregate purchase
price shall be 99.6308% of the principal amount thereof ($214,206,220), plus
accrued interest, if any, from December 3, 2002 to the date of payment and
delivery (the "Purchase Price").
3. Terms of Public Offering. The Company is advised by the
Underwriters that the Underwriters propose to make a public offering of the
Securities as soon after the execution and delivery of this Agreement as in
judgment of the Underwriters is advisable on the basis set forth in the
Prospectus Supplement.
4. Delivery and Payment. Delivery to the Underwriters of and payment
for the Securities shall be made at 10:00 A.M., New York City time, on December
3, 2002 (the "Closing Date"), at such place as you shall designate. The Closing
Date and the location of delivery of and the form of payment for the Securities
may be varied by agreement between you and the Company. On the Closing Date, the
Underwriters will make a payment to the Company in an amount previously agreed
to by the Company and the Underwriters for a portion of the Company's expenses
of the offering of the Securities (such payment, the "Expense Reimbursement").
Certificates for the Securities shall be registered in such names and
issued in such denominations as you shall request in writing not later than two
full business days prior to the Closing Date. Such certificates shall be made
available to you for inspection not later
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than 9:30 A.M., New York City time, on the business day next preceding the
Closing Date. Certificates in definitive form evidencing the Securities shall be
delivered to you on the Closing Date with any transfer taxes thereon duly paid
by the Company, for the account of the Underwriters, against payment of the
Purchase Price (net of the Expense Reimbursement) therefor by wire or certified
or official bank checks payable in Federal funds to the order of the Company. If
the Securities will be issued in book-entry form, the Company shall deposit the
global certificate(s) representing the Securities with the Depository Trust
Company ("DTC"), or its designated custodian, on the Closing Date, and the
Company will deliver such global certificate(s) to the Underwriters by causing
DTC to credit the Securities to the accounts of the Underwriters at DTC against
payment therefor as set forth above.
5. Agreements of the Issuers. The Issuers, jointly and severally,
agree with each Underwriter as follows:
(a) The Issuers will, if necessary or required by law, file an
amendment to the Registration Statement or, if necessary pursuant to Rule
430A under the Act, a post-effective amendment to the Registration
Statement, as soon as practicable after the execution and delivery of this
Agreement, and will use their best efforts to cause the Registration
Statement or such post-effective amendment to become effective at the
earliest possible time. The Company will comply fully and in a timely
manner with the applicable provisions of Rule 424 and Rule 430A under the
Act.
(b) The Issuers will advise you promptly and, if requested by you,
will confirm such advice in writing: (i) of the effectiveness of any
amendment to the Registration Statement; (ii) of the transmission to the
Commission for filing of any supplement to the Prospectus (including any
document that would as a result of such filing become an Incorporated
Document) and to furnish you with copies thereof; (iii) of the receipt of
any comments from the Commission that relate to the Registration Statement
or of any request by the Commission for amendment of or a supplement to the
Registration Statement or the Prospectus or for additional information;
(iv) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or any order preventing or
suspending the use of the Prospectus or of the suspension of qualification
of the Securities for offering or sale in any jurisdiction or the
initiation or the threatening of any proceeding for such purpose; and (v)
within the period of time referred to in paragraph (e) below, of any change
in the Company's condition (financial or other), business, prospects,
properties, net worth or results of operations, or of the happening of any
event, which makes any statement of a material fact made in the
Registration Statement or the Prospectus (as then amended or supplemented)
untrue or which requires the making of any additions to or changes in the
Registration Statement or the Prospectus (as then amended or supplemented)
in order to state a material fact required to be stated therein or
necessary in order to make the statements therein not misleading, or of the
necessity to amend or supplement the Prospectus (as then amended or
supplemented) to comply with the Act or any other law. If at any
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time any stop order suspending the effectiveness of the Registration
Statement or any order preventing or suspending the use of the Prospectus
or suspending any such qualification shall be issued, the Issuers will
promptly use their best efforts to obtain the withdrawal of such order at
the earliest possible time.
(c) The Issuers will furnish to you, without charge, (i) five copies
of the registration statement as originally filed with the Commission and
of each amendment thereto, including all exhibits thereto, (ii) the
Prospectus and any amendment or supplement thereto, (iii) such number of
copies of the registration statement as originally filed and of each
amendment thereto, but without exhibits, as you may request, (iv) such
number of copies of the Incorporated Documents, without exhibits, as you
may request, and (v) five copies of the exhibits to the Incorporated
Documents.
(d) The Issuers will not file any amendment to the Registration
Statement or make any amendment or supplement to the Prospectus or, prior
to the end of the period of time referred to in paragraph (e) below, file
any document which, upon filing becomes an Incorporated Document, of which
you shall not previously have been advised or to which, after you shall
have received a copy of the document proposed to be filed, you shall
reasonably object.
(e) As soon after the execution and delivery of this Agreement as
possible and thereafter from time to time for such period as in the opinion
of counsel for the Underwriters a prospectus is required by the Act to be
delivered in connection with sales by any Underwriter or any dealer, the
Issuers will expeditiously deliver to the Underwriters and each dealer,
without charge, as many copies of the Prospectus (and of any amendment or
supplement thereto) as you may reasonably request. The Issuers consent to
the use of the Prospectus (and of any amendment or supplement thereto) in
accordance with the provisions of the Act and with the securities or Blue
Sky laws of the jurisdictions in which the Securities are offered by any
Underwriter and by all dealers to whom Securities may be sold, both in
connection with the offering and sale of the Securities and for such period
of time thereafter as the Prospectus is required by the Act to be delivered
in connection with sales by any Underwriter or any dealer.
(f) If during the period of time referred to in paragraph (e) above
any event shall occur as a result of which, in the judgment of the Issuers
or in the opinion of counsel for the Underwriters, it becomes necessary to
amend or supplement the Prospectus in order to make the statements therein,
in the light of the circumstances when the Prospectus is delivered to a
purchaser, not misleading, or if it is necessary to amend or supplement the
Prospectus to comply with the Act or any other law, the Issuers will
forthwith prepare and, subject to the provisions of paragraph (d) above,
file with the Commission an appropriate amendment or supplement to the
Prospectus so that the statements in the Prospectus, as so amended or
supplemented, will not, in the light of the circumstances when it is so
delivered, be misleading, or so that the Pro-
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spectus will comply with law, and to furnish to the Underwriters and to
such dealers as you shall specify such number of copies thereof as the
Underwriters or such dealers may reasonably request. In the event that the
Issuers and you agree that the Prospectus should be amended or
supplemented, the Issuers, if requested by you, will promptly issue a press
release, in compliance with applicable securities laws, announcing or
disclosing the matters to be covered by the proposed amendment or
supplement.
(g) The Issuers will cooperate with you and with counsel for the
Underwriters in connection with the registration or qualification of the
Securities for offering and sale by any Underwriter and by dealers under
the securities or Blue Sky laws of such jurisdictions as you may designate
and will file such consents to service of process or other documents
necessary or appropriate in order to effect such registration or
qualification; provided, however, that in no event shall any Issuer be
obligated to qualify to do business in any jurisdiction where it is not now
so qualified or to take any action which would subject it to service of
process in suits, other than those arising out of the offering or sale of
the Securities, in any jurisdiction where it is not now so subject.
(h) The Issuers will make generally available to its security holders
a consolidated earnings statement, which need not be audited, covering a
twelve-month period commencing after the date of the Prospectus and ending
not later than 15 months thereafter, as soon as practicable after the end
of such period, which consolidated earnings statement shall satisfy the
provisions of Section 11(a) of the Act and Rule 158 thereunder, and will
advise you in writing when such statement has been made available.
(i) During the period of five years hereafter, the Issuers will
furnish to you as soon as available, a copy of all public materials
furnished by the Company to its stockholders and all public reports and
financial statements furnished by the Company to the principal national
securities exchange upon which the common stock of the Company may be
listed pursuant to requirements of or agreements with such exchange or to
the Commission.
(j) The Company will apply the net proceeds from the sale of the
Securities in accordance with the description set forth in the Prospectus
under the caption "Use of Proceeds."
(k) Neither the Company nor any of its subsidiaries has taken, or will
take, directly or indirectly, any action designed to or that might
reasonably be expected to cause or result in stabilization or manipulation
of the price of the Securities to facilitate the sale or resale of the
Securities.
(l) The Issuers will pay all costs, expenses, fees and taxes incident
to (i) the preparation, printing, filing and distribution under the Act of
the Registration State-
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ment (including financial statements and exhibits), and all amendments and
supplements thereto prior to or during the period specified in paragraph
(e) above, (ii) the preparation of the Indenture, the issuance of the Notes
and the fees of the Trustee; (iii) the printing and delivery (including
postage, air freight charges and charges for counting and packaging) of
such copies of the Prospectus and all amendments or supplements thereto
during the period specified in paragraph (e) above, (iv) the printing and
delivery of this Agreement, the Preliminary and Supplemental Blue Sky
Memoranda and all other agreements, memoranda, correspondence and other
documents printed and delivered in connection with the offering of the
Securities (including in each case any disbursements of counsel for the
Underwriters relating to such printing and delivery), (v) the registration
or qualification of the Securities for offer and sale under the securities
or Blue Sky laws of the several states (including in each case the
reasonable fees and disbursements of counsel for the Underwriters relating
to such registration or qualification and memoranda relating thereto), (vi)
filings and clearance with the National Association of Securities Dealers,
Inc. in connection with the offering, (vii) the listing, if any, of the
Securities on any national securities exchange and (viii) furnishing such
copies of the Registration Statement, the Prospectus and all amendments and
supplements thereto as may be requested for use in connection with the
offering or sale of the Securities by any Underwriter or by dealers to whom
Securities may be sold. The Issuers will also pay the $100,000 fee of the
QIU.
(m) The Issuers will not during the period beginning on the date
hereof and continuing to and including the Closing Date, offer, sell,
contract to sell or otherwise dispose of any debt securities of the Company
or any warrants, options or other rights to purchase or acquire debt
securities of the Company or any securities convertible into or
exchangeable for debt securities of the Company (other than (i) the
Securities and (ii) commercial paper issued in the ordinary course of
business), without the prior written consent of Banc of America.
(n) The Issuers will use their best efforts to do and perform all
things required or necessary to be done and performed under this Agreement
by the Issuers prior to the Closing Date and to satisfy all conditions
precedent to the delivery of the Securities.
6. Representations and Warranties of the Issuers. The Issuers, jointly
and severally, represent and warrant to each Underwriter that:
(a) Each preliminary prospectus included as part of the registration
statement as originally filed or as part of any amendment or supplement
thereto, or filed pursuant to Rule 424 under the Act, complied when so
filed in all material respects with the provisions of the Act. The
Commission has not issued any order preventing or suspending the use of any
preliminary prospectus.
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(b) The Registration Statement has become effective and at the date of the
Prospectus (if different), including at the date of any post-effective amendment
or supplement, the Registration Statement will comply in all material respects
with the provisions of the Act, and will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading; the Prospectus (and
any supplements or amendments thereto) will at all such times comply in all
material respects with the provisions of the Act and will not at any such time
contain any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however,
that no representation or warranty is made as to information contained in or
omitted from the Registration Statement or the Prospectus in reliance upon and
in conformity with written information furnished to the Issuers with respect to
the Underwriters specifically for inclusion therein.
(c) The Incorporated Documents, at the time they were filed with the
Commission or, to the extent such documents were subsequently amended prior to
the date hereof, at the time so amended, complied in all material respects with
the requirements of the Act or the Securities Exchange Act of 1934, as amended,
and the published rules and regulations of the Commission thereunder
(collectively, the "Exchange Act"), as applicable, and such documents do not on
the date hereof and will not on the Closing Date contain an untrue statement of
a material fact and do not on the date hereof and will not on the Closing Date
omit to state a material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading.
(d) The financial statements (including the related notes and supporting
schedules) in the Registration Statement or the Prospectus present fairly the
consolidated financial position and results of operations of the entities
purported to be shown thereby, at the dates and for the periods indicated, and
have been prepared in conformity with generally accepted accounting principles
applied on a consistent basis throughout the periods involved, except for
changes in accounting principles described therein. The pro forma financial
statements and other pro forma financial information (including the notes
thereto) in the Prospectus have been prepared in all material respects in
accordance with applicable requirements of Regulation S-X promulgated under the
Exchange Act and have been properly computed on the bases described therein. The
material assumptions used in the preparation of the pro forma financial
statements and other pro forma information in the Prospectus are set forth
therein and are reasonable, and the adjustments used therein are appropriate to
give pro forma effect to the transactions or circumstances referred to therein.
(e) Ernst & Young, LLP, who have reported on the financial statements of
the Company, are independent public accountants with respect to the Company and
its
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subsidiaries as required by the Act and, to the Company's knowledge, are not in
violation of the auditor independence requirements of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of
2002 (the "▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act").
(f) [RESERVED]
(g) The Company and each of its subsidiaries have been duly formed and are
validly existing in good standing under the laws of their respective
jurisdictions of organization, are duly qualified to do business and are in good
standing in each jurisdiction in which their respective ownership or lease of
property or the conduct of their respective businesses requires such
qualification except where the failure to so qualify, singly or in the
aggregate, would not have a material adverse effect on the financial condition,
results of operations, business or prospects of the Company and its subsidiaries
taken as a whole (a "Material Adverse Effect"), and have all power and authority
necessary to own or hold their respective properties and to conduct the
businesses in which they are engaged.
(h) The Company has an authorized capitalization as set forth in the
Prospectus; and all of the issued equity interests of each subsidiary of the
Company have been duly authorized and validly issued and, as to shares of
capital stock of any corporation constituting a subsidiary, are fully paid and
non-assessable and (except for directors' qualifying shares as disclosed in the
Registration Statement or the Prospectus or minority interests in non-Guarantor
subsidiaries) are owned directly or indirectly by the Company, free and clear of
all liens, encumbrances, equities or claims other than restrictions on transfer
imposed by applicable securities laws.
(i) The execution, delivery and performance of this Agreement, the
Indenture and the Securities by the Issuers, compliance by the Issuers of all
the provisions hereof and thereof and the consummation of the transactions
contemplated hereby will not conflict with or result in a breach or violation of
any of the terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other material agreement or
instrument to which the Company or any of its subsidiaries is a party or by
which the Company or any of its subsidiaries is bound or to which any of the
property or assets of the Company or any of its subsidiaries is subject, nor
will such actions result in any violation of the provisions of the
organizational documents of the Company or any of its subsidiaries or any
statute or any order, rule or regulation of any court or governmental agency or
body having jurisdiction over the Company or any of its subsidiaries or any of
their property or assets; and except for such consents, approvals,
authorizations, registrations or qualifications as may be required under the Act
or applicable state or foreign securities laws in connection with the purchase
and distribution of the Securities by any Underwriter, no consent, approval,
authorization or order of, or filing or registration with, any such court or
governmental agency or body is required for the execution, delivery and
performance of
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this Agreement, the Indenture and the Securities by the Issuers, compliance by
the Issuers of all the provisions hereof and thereof and the consummation of the
transactions contemplated hereby.
(j) This Agreement has been duly authorized, executed and delivered by the
Issuers and is a valid and binding agreement of the Issuers enforceable in
accordance with its terms (except as rights to indemnity and contribution
hereunder may be limited by applicable law).
(k) The Indenture has been duly qualified under the Trust Indenture Act of
1939, as amended (the "TIA"), and has been duly authorized, executed and
delivered by the Issuers and is a valid and binding agreement of the Issuers,
enforceable in accordance with its terms except as (i) the enforceability
thereof may be limited by bankruptcy, insolvency or similar laws affecting
creditors' rights generally and (ii) rights of acceleration and the availability
of equitable remedies may be limited by equitable principles of general
applicability.
(l) The Notes have been duly authorized and, when executed and
authenticated in accordance with the provisions of the Indenture and delivered
to each of the Underwriters against payment therefor as provided by this
Agreement, will be entitled to the benefits of the Indenture, and will be valid
and binding obligations of the Company, enforceable in accordance with their
terms except as (i) the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally and (ii) rights
of acceleration and the availability of equitable remedies may be limited by
equitable principles of general applicability.
(m) The Guarantees have been duly authorized and, upon endorsement on the
Notes by the Guarantors, execution and authentication of the Notes in accordance
with the provisions of the Indenture and delivery of the Notes to each of the
Underwriters against payment therefor as provided by this Agreement, will be
entitled to the benefits of the Indenture, and will be valid and binding
obligations of the Guarantors, enforceable in accordance with their terms except
as (i) the enforceability thereof may be limited by bankruptcy, insolvency or
similar laws affecting creditors' rights generally and (ii) rights of
acceleration and the availability of equitable remedies may be limited by
equitable principles of general applicability.
(n) The Securities and the Indenture conform to the description thereof in
the Prospectus.
(o) Neither the Company nor any of its subsidiaries has sustained, since
the date of the latest audited financial statements in the Prospectus, any loss
or interference with the business of the Company and its subsidiaries taken as a
whole from fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any
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labor dispute or court or governmental action, order or decree, otherwise than
as set forth or contemplated in the Prospectus, resulting in a Material Adverse
Effect; and, since such date, there has not been any material change in the
capital stock or long-term debt of the Company or any of its subsidiaries or any
material adverse change, or any development involving a prospective material
adverse change, in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of the Company and its
subsidiaries taken as a whole, otherwise than as set forth or contemplated in
the Prospectus.
(p) There are no contracts, agreements or understandings between the
Company and any person granting such person the right to require the Company to
file a registration statement under the Act with respect to any securities of
the Company owned or to be owned by such person or to require the Company to
include such securities in the securities registered pursuant to the
Registration Statement or in any securities being registered pursuant to any
other registration statement filed by the Company under the Act.
(q) The Company and its subsidiaries own the items of real property and
personal property purported to be owned by them which are material to the
conduct of the business of the Company and its subsidiaries taken as a whole,
free and clear of all liens, encumbrances and defects, except such as are
described in the Prospectus or such as would not have a Material Adverse Effect.
All real property held under lease by the Company and its subsidiaries are held
by them under valid, subsisting and enforceable leases, with such exceptions as
are described in the Prospectus or such as would not have a Material Adverse
Effect.
(r) Except as described in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its subsidiaries
is a party or of which any property or assets of the Company or any of its
subsidiaries is the subject which are reasonably likely to have a Material
Adverse Effect; and to the Issuers' knowledge, no such proceedings are
threatened by governmental authorities or by others.
(s) The conditions for use of Form S-3, as set forth in the General
Instructions thereto, have been satisfied.
(t) To the Issuers' knowledge, all real property owned (either presently or
at any time in the past) or presently leased by the Company and its subsidiaries
in connection with the operation of their business, including, without
limitation, any subsurface soils and ground water (collectively, the "Realty"),
is free of contamination from any substance or material presently known to be
toxic or hazardous, including, without limitation, any radioactive substance,
methane, volatile hydrocarbons or industrial solvents (each, a "Hazardous
Substance"), which could reasonably be expected to materially
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impair the beneficial use thereof by the Company and its subsidiaries or
constitute or cause a significant health, safety or other environmental hazard
to occupants or users (except for contaminations which would not have a Material
Adverse Effect); and to the Issuers' knowledge, the Realty does not contain any
underground storage or treatment tanks, active or abandoned water, gas or oil
▇▇▇▇▇, or any other underground improvements or structures, other than the
foundations, footings or other supports for the improvements located thereon,
the presence of which would have a Material Adverse Effect. Notwithstanding the
foregoing, Hazardous Substances shall be deemed not to include any supplies or
substances maintained, used, stored or held on the Realty which are (i)
naturally occurring, (ii) installed by public utilities or (iii) used in the
ordinary course of the Company's or its subsidiaries' business, provided that
such supplies or substances are stored, used, maintained and held in all
material respects in accordance with any applicable governmental requirements
and with restrictions, conditions and standards suggested by the manufacturer
and the Company's insurance carriers.
(u) The Company and its subsidiaries carry, or are covered by, insurance in
such amounts and covering such risks as is adequate for the conduct of their
respective businesses.
(v) The Company and its subsidiaries own or possess adequate rights to use
all material patents, patent applications, trademarks, service marks, trade
names, trademark registrations, service ▇▇▇▇ registrations, copyrights and
licenses necessary for the conduct of their respective businesses the absence of
which would have a Material Adverse Effect and have no reason to believe that
the conduct of their respective businesses will conflict with, and have not
received any notice of any claim of conflict with, any such rights of others.
(w) There are no contracts or other documents which are required to be
described in the Prospectus or filed as exhibits to the Registration Statement
by the Act which have not been described in the Prospectus or filed as exhibits
to the Registration Statement or incorporated therein by reference as permitted
by the Act.
(x) No labor disturbance by the employees of the Company or any of its
subsidiaries exists or, to the Issuers' knowledge, is imminent which could
reasonably be expected to have a Material Adverse Effect.
(y) The Company and its subsidiaries have filed all federal, state and
local income and franchise tax returns required to be filed through the date
hereof and has paid all taxes due thereon, except where the failure to do so has
not had and would reasonably not be expected to have a Material Adverse Effect,
and no tax deficiency has been determined adversely to the Company or any of its
subsidiaries which has had
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(nor does any Issuer have any knowledge of any tax deficiency which would
reasonably likely have) a Material Adverse Effect.
(z) Since the date as of which information is given in the Prospectus,
and except as may otherwise be disclosed in the Prospectus, neither the
Company nor any of its subsidiaries has (i) entered into any material
transaction not in the ordinary course of business or (ii) declared or paid
any dividend on its capital stock, and, from the date of the Prospectus,
neither the Company nor any of its subsidiaries has incurred any liability
other than in the ordinary course of business that is material to the
Company and its subsidiaries taken as a whole.
(aa) The Company is in full compliance with Section 13(b)(2) of the
Exchange Act.
(bb) Neither the Company nor any of its subsidiaries (i) is in
violation of its organizational documents, (ii) is in default in any
material respect, and no event has occurred which, with notice or lapse of
time or both, would constitute such a default, in the due performance or
observance of any term, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement or other material agreement or
instrument to which it is a party or by which it is bound or to which any
of its properties or assets is subject as a result of which default there
would be a Material Adverse Effect or (iii) is in violation of any law,
ordinance, governmental rule, regulation or court decree to which it or its
property or assets may be subject or has failed to obtain any license,
permit, certificate, franchise or other governmental authorization or
permit necessary to the ownership of its property or to the conduct of its
business which violation or failure would have a Material Adverse Effect.
(cc) Neither the Company nor any of its subsidiaries is an "investment
company" or an entity "controlled" by an "investment company" within the
meaning of the Investment Company Act of 1940, as amended, and the rules
and regulations of the Commission thereunder.
7. Indemnification. (a) The Issuers, jointly and severally, agree to
indemnify and hold harmless each Underwriter, each person, if any, who controls
any Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, and the directors, officers, employees and agents of each of the
foregoing (collectively, the "Underwriter Indemnified Parties"), from and
against any and all losses, claims, damages, liabilities and judgments caused by
any untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto) or any
preliminary prospectus, or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages, liabilities or judgments are caused by any such untrue
-13-
statement or omission or alleged untrue statement or omission based upon
information relating to any Underwriter furnished in writing to the Issuers by
or on behalf of such Underwriter expressly for use therein; provided, however,
that the foregoing indemnity agreement with respect to any preliminary
prospectus shall not inure to the benefit of any Underwriter Indemnified Party
asserted by a person with respect to any such losses, claims, damages and
liabilities and judgments, if a copy of the Prospectus (as then amended or
supplemented if the Issuers shall have furnished such amendment or supplement
thereto in the requisite quantity on a timely basis to permit such sending or
giving) was not sent or given by or on behalf of such Underwriter or related
Underwriter Indemnified Party to such person, if required by law so to have been
delivered, at or prior to the written confirmation of the sale of Securities to
such person, and if the Prospectus (as so amended and supplemented) would have
cured the defect giving rise to such loss, claim, damage, liability or judgment.
Notwithstanding anything to the contrary herein, no Underwriter shall be
obligated to send or give any Incorporated Document, or any amendment or
supplement thereto, to any person in order to benefit from the indemnity
provisions herein or otherwise. The foregoing indemnity agreement shall be in
addition to any liability that the Issuers may otherwise have.
(b) The Issuers, jointly and severally, also agree to indemnify and
hold harmless Banc One and its Underwriter Indemnified Parties, from and against
any and all losses, claims, damages, liabilities and judgments incurred as a
result of Banc One's participation as the QIU in the offering of the Notes;
provided, however, that the Issuers shall not be liable under the foregoing
indemnity to the extent that any loss, claim, damage, liability or judgment
results from the gross negligence or willful misconduct of the QIU.
(c) In case any action shall be brought against any Underwriter
Indemnified Party, based upon any preliminary prospectus, the Registration
Statement or the Prospectus or any amendment or supplement thereto and with
respect to which indemnity may be sought against the Issuers, the Underwriters
shall promptly notify the Issuers in writing and the Issuers shall assume the
defense thereof, including the employment of counsel reasonably satisfactory to
such indemnified party and payment of all fees and expenses. Such Underwriter
Indemnified Party shall have the right to employ separate counsel in any such
action and participate in the defense thereof, but the fees and expenses of such
counsel shall be at the expense of such Underwriter Indemnified Party unless (i)
the employment of such counsel shall have been specifically authorized in
writing by the Issuers, (ii) the Issuers shall have failed to assume the defense
and employ counsel or (iii) the named parties to any such action (including any
impleaded parties) include both such Underwriter Indemnified Party and the
Issuers and such Underwriter Indemnified Party shall have been advised by such
counsel that there may be one or more legal defenses available to it which are
different from or additional to those available to the Issuers (in which case
the Issuers shall not have the right to assume the defense of such action on
behalf of such Underwriter Indemnified Party, it being understood, however, that
the Issuers shall not, in connection with any one such action or separate but
substantially similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances, be liable for the fees and
expenses of more than one separate firm
-14-
of attorneys (in addition to any local counsel) for all such Underwriter
Indemnified Parties, which firm shall be designated in writing by Banc of
America and that all such fees and expenses shall be reimbursed as they are
incurred). The Issuers shall not be liable for any settlement of any such action
effected without the Company's written consent but if settled with the written
consent of the Company, the Issuers agree to indemnify and hold harmless the
Underwriter Indemnified Parties from and against any loss or liability by reason
of such settlement. The Company shall not, without the prior written consent of
the Underwriter Indemnified Parties, effect any settlement of any pending or
threatened proceeding in respect of which any Underwriter Indemnified Party is
or could have been a party and indemnity could have been sought hereunder by
such Underwriter Indemnified Party, unless such settlement includes an
unconditional release of such Underwriter Indemnified Party from all liability
on claims that are the subject matter of such proceeding.
(d) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Issuers, their directors, their officers who sign the
Registration Statement and any person controlling the Issuers within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act, to the same extent
as the foregoing indemnity from the Issuers to the Underwriter Indemnified
Parties but only with reference to information relating to such Underwriter
furnished in writing by or on behalf of such Underwriter expressly for use in
the Registration Statement, the Prospectus or any preliminary prospectus. In
case any action shall be brought against the Issuers, any of its directors, any
such officer or any person controlling the Issuers based on the Registration
Statement, the Prospectus or any preliminary prospectus and in respect of which
indemnity may be sought against any Underwriter, such Underwriter shall have the
rights and duties given to the Issuers (except that if the Issuers shall have
assumed the defense thereof, such Underwriter shall not be required to do so,
but may employ separate counsel therein and participate in the defense thereof
but the fees and expenses of such counsel shall be at the expense of such
Underwriter), and the Issuers, their directors, any such officers and any person
controlling the Issuers shall have the rights and duties given to the
Underwriters, by Section 7(c) hereof.
(e) If the indemnification provided for in this Section 7 is
unavailable to or insufficient to hold harmless an indemnified party in respect
of any losses, claims, damages, liabilities or judgments referred to therein,
then each indemnifying party, in lieu of indemnifying such indemnified party,
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages, liabilities and judgments (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Issuers on the one hand and the Underwriters on the other hand from the offering
of the Securities or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Issuers and the Underwriters in connection with the statements or
omissions which resulted in such losses, claims, damages, liabilities or
judgments, as well as any other relevant equitable considerations. The relative
benefits received by the Issuers and the Underwriters shall be deemed to be in
the same proportion as the total net proceeds from the
-15-
offering (before deducting expenses) received by the Company, and the
compensation received by the Underwriters (based on discount to investors on
resale), bear to the sum of such total net proceeds and such compensation. The
relative fault of the Issuers and the Underwriters shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission to state a material fact relates to
information supplied by the Issuers or any Underwriter and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
The Issuers and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7(e) were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages, liabilities or judgments referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, the Underwriters shall not be
required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which the
Underwriters have otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. 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.
(f) The Underwriters confirm and the Issuers acknowledge that the
statements with respect to the public offering of the Securities by the
Underwriters set forth in the third and fourth paragraphs of the section
entitled "Underwriting" in the Prospectus Supplement are correct and constitute
the only information concerning the Underwriters furnished in writing to the
Issuers by or on behalf of the Underwriters specifically for inclusion in the
Registration Statement and the Prospectus.
8. Conditions of Underwriters' Obligation. The obligation of the
Underwriters to purchase the Securities under this Agreement is subject to the
satisfaction of each of the following conditions:
(a) All the representations and warranties of the Issuers contained in
this Agreement shall be true and correct on the Closing Date with the same
force and effect as if made on and as of the Closing Date. The Issuers
shall have performed or complied with all of their agreements herein
contained and required to be performed or complied with by them at or prior
to the Closing Date.
(b) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall
have been
-16-
commenced or shall be pending before or threatened by the Commission, (ii)
every request for additional information on the part of the Commission
shall have been complied with in all material respects, and (iii) no stop
order suspending the sale of the Securities in any jurisdiction referred to
in Section 6(g) shall have been issued and no proceeding for that purpose
shall have been commenced or shall be pending or threatened which would, in
your reasonable judgment, make it impracticable or inadvisable to market
the Securities or to enforce contracts for the sale of the Securities.
(c) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date, there shall not have been any downgrading, nor
shall any notice have been given of any intended or potential downgrading
or of any review for a possible change that does not indicate the direction
of the possible change, in the rating accorded any Issuer's debt by any
"nationally recognized statistical rating organization," as such term is
defined for purposes of Rule 436(g)(2) under the Act.
(d) (i) Since the date of the latest balance sheet included in the
Registration Statement and the Prospectus, there shall not have been any
material adverse change, or any development involving a prospective
material adverse change, in the condition, financial or otherwise, or in
the earnings, affairs or business prospects, whether or not arising in the
ordinary course of business, of the Company and its subsidiaries taken as a
whole, (ii) since the date of the latest balance sheet included in the
Registration Statement and the Prospectus there shall not have been any
material change in the capital stock or in the long-term debt of the
Company or any of its subsidiaries from that set forth in the Registration
Statement and Prospectus and (iii) the Company and its subsidiaries shall
have no liability or obligation, direct or contingent, which is material to
the Company and its subsidiaries, taken as a whole, other than those
reflected in the Registration Statement and the Prospectus.
(e) You shall have received on the Closing Date a certificate dated
the Closing Date, signed by (i) ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ or ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and
(ii) ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, in their capacities as (A) the Chairman of the Board
or Chief Executive Officer and President and (B) Chief Financial Officer of
the Company, respectively, confirming the matters set forth in paragraphs
(a), (b), (c) and (d) of this Section 8.
(f) You shall have received on the Closing Date an opinion
(satisfactory to you and counsel for the Underwriter), dated the Closing
Date, of ▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, special counsel for the Company, to
the effect that:
(i) The Company is validly existing as a corporation in good
standing under the laws of the State of Delaware and has all corporate
power and authority necessary to execute, deliver and perform its
obligations under the Underwriting Agreement, the Indenture and the
Notes. Each of the Guarantors that are organized under the laws of the
States of California, Colorado, Delaware,
-17-
Nevada and Texas (the "Specified Guarantors") that is a corporation is
validly existing as a corporation in good standing under the laws of
its state of incorporation and has all corporate power and authority
necessary to execute, deliver and perform its obligations under the
Underwriting Agreement, the Indenture and the Guarantees. Each
Specified Guarantor that is a limited liability company or a limited
partnership is validly existing as a limited liability company or a
limited partnership, as the case may be, under the laws of its state
of its formation and has all limited liability company or partnership
power and authority necessary to execute, deliver and perform its
obligations under the Underwriting Agreement, the Indenture and the
Guarantees.
(ii) To such counsel's knowledge and other than as described in
the Prospectus, there are no legal or governmental proceedings pending
to which the Company or any of its subsidiaries is a party or of which
any property or assets of the Company or any of its subsidiaries is
the subject which is of a character which is required to be disclosed
in the Prospectus; and, to such counsel's knowledge, no such
proceedings are threatened by governmental authorities or by others.
(iii) The Registration Statement was declared effective under the
Act as of the date and time specified in such opinion, the Prospectus
was filed with the Commission pursuant to the subparagraph of Rule
424(b) under the Act on the date specified therein, and, to such
counsel's knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceeding for that
purpose is pending or threatened by the Commission.
(iv) The Registration Statement and the Prospectus and any
further amendments or supplements thereto made by the Company prior to
the Closing Date (other than the financial data (and the related notes
thereto) and statistical data and the financial statements and related
schedules therein, as to which such counsel need express no opinion)
appear on their face to comply as to form in all material respects
with the requirements of the Act; the documents incorporated by
reference in the Prospectus and any further amendment or supplement to
any such incorporated document made by the Company prior to the
Closing Date (other than the financial data (and the related notes
thereto) and statistical data and the financial statements, and
related schedules therein, as to which such counsel need express no
opinion), when they were filed with the Commission appear on their
face to have been appropriately responsive in all material respects to
the requirements of the Act and the Exchange Act.
(v) To such counsel's knowledge, there are no contracts or
other documents which are required to be described in the Prospectus
or filed as exhibits to the Registration Statement by the Act which
have not been described
-18-
in the Prospectus or filed as exhibits to the Registration Statement
or incorporated therein by reference as permitted by the Act.
(vi) This Agreement has been duly authorized, executed and
delivered by the Issuers.
(vii) The execution and delivery of the Underwriting Agreement,
the issuance and sale of the Securities and the execution, delivery
and performance of the Indenture and the Securities by the Issuers
will not result in a material breach or violation of any of the terms
or provisions of, or constitute a material default under, any
indenture, mortgage, deed of trust, loan agreement or other material
agreement or instrument listed as an exhibit to the Company's Annual
Report on Form 10-K for the fiscal year ended September 30, 2001 or to
any subsequent filing under the Exchange Act or the Act by the
Company, nor will such actions result in any violation of the
provisions of the articles or certificates of incorporation, bylaws,
limited liability company agreement, limited partnership agreement,
operating agreement or other constitutive document of the Company or
any Specified Guarantor under any Applicable Law (as defined below) or
any order, judgment or decree known to us under any court or
government agency or body of the United States of America or the
States of New York, California or Texas having jurisdiction over the
Company or any Specified Guarantor or any of its property or assets
under any Applicable Law.
For the purposes of this Section 8(f)(vii), the term
"Applicable Law" shall mean the Delaware General Corporation Law, the
Delaware Limited Liability Company Act and the Delaware Revised
Uniform Limited Partnership Act, the Nevada General Corporation Law,
the present corporation, partnership and limited liability company
statutes of the States of California, Texas and Colorado, any of the
present laws of the United States of America, any of the present laws
of the State of New York, the statutes, rules or regulations of the
State of California and Texas, in each case generally applicable to
transactions in the nature of those contemplated by the Underwriting
Agreement and the Indenture, and to present judicial interpretations
thereto and to the facts as they presently exist.
(viii) The Indenture has been duly authorized, executed and
delivered by the Company and the Specified Guarantors and is a valid
and binding agreement of the Company and the Guarantors, enforceable
against the Company and the Guarantors in accordance with its terms.
(xi) The Notes have been duly authorized and executed by the
Company and, when authenticated in accordance with the provisions of
the Indenture and delivered to the Underwriters against payment
therefor as provided by
-19-
the this Agreement, will be entitled to the benefits of the Indenture,
and will be valid and binding obligations of the Company, enforceable
against the Company in accordance with their terms.
(x) The Guarantees have been duly authorized and endorsed on
the Notes by the Guarantors, and, upon authentication of the Notes in
accordance with the provisions of the Indenture and delivery thereof
to the Underwriters against payment therefor as provided by this
Agreement, will be entitled to the benefits of the Indenture, and will
be valid and binding obligations of the Guarantors, enforceable
against the Guarantors in accordance with their terms.
(xi) The Securities and the Indenture conform in all material
respects to the descriptions thereof in the Prospectus.
(xii) The Supplemental Indenture is (x) authorized and permitted
by the Indenture, (y) not inconsistent with the Indenture and (z)
valid and binding upon the Issuers an accordance with its terms.
In rendering such opinion, such counsel may state that its opinion is
limited to the Federal laws of the United States of America, the laws of the
States of Texas and New York and the General Corporation Law of the State of
Delaware. Such counsel shall also have furnished to the Underwriters a written
statement, addressed to the Underwriters and dated the Closing Date, in form and
substance satisfactory to the Underwriters and counsel for the Underwriters, to
the effect that (x) such counsel has acted as special counsel to the Company in
connection with the preparation of the Registration Statement and during the
course of the preparation of the Registration Statement and Prospectus, such
counsel participated in conferences with representatives of the Company, the
Company's internal counsel, and its accountants and the representatives of the
Underwriters and at which conferences the contents of the Registration Statement
and the Prospectus and related matters were discussed, and (y) based on the
foregoing, no facts have come to the attention of such counsel which lead it to
believe that (I) the Registration Statement (except as to financial data (and
related notes thereto) and statistical data and the financial statements and
related schedules contained or incorporated by reference therein), as of the
date the Registration Statement became effective, contained any untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary in order to make the statements therein not misleading, or
that the Prospectus (except as to financial data (and related notes thereto) and
statistical data and the financial statements and related schedules contained or
incorporated by reference therein) contains any untrue statement of a material
fact or omits to state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading or (II) any Incorporated Document or
any amendment or supplement thereto made by the Company prior to such Closing
Date, when they were filed with the Commission, as the case may be, contained
(except as to financial and data (and related notes thereto) and statistical
data and the financial statements and related
-20-
schedules contained or incorporated by reference therein) an untrue statement of
a material fact or omitted to state a material fact necessary in order to make
the statements therein, in light of the circumstances under which they were
made, not misleading. The foregoing opinion and statement may be qualified by a
statement to the effect that such counsel has not independ ently verified the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or Prospectus or incorporated by reference therein, and
such counsel is not passing upon and such counsel does not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement or the Prospectus.
(g) You shall have received on the Closing Date an opinion, dated the
Closing Date, of ▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇, counsel for the Underwriter, in
form and substance satisfactory to the Underwriters.
(h) You shall have received a letter on and as of the Closing Date, in
form and substance satisfactory to you, from Ernst & Young, LLP,
independent public accountants, with respect to the financial statements
and certain financial information contained in the Registration Statement
and the Prospectus and substantially in the form and substance of the
letter delivered to you by Ernst & Young, LLP, on the date of this
Agreement.
(i) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements in the
Prospectus any loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from any
labor dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus or (ii) since such date
there shall not have been any change in the capital stock, net revenues,
per share or total amounts of income before extraordinary income or of net
income or long-term debt of the Company or any of its subsidiaries or any
change, or any development involving a prospective change, in or affecting
the general affairs, management, financial position, stockholders' equity
or results of operations of the Company and its subsidiaries, otherwise
than as set forth or contemplated in the Prospectus, the effect of which,
in any such case described in clause (i) or (ii), is, in the judgment of
the Underwriters, so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the
Securities being delivered on the Closing Date on the terms and in the
manner contemplated in the Prospectus.
(j) The Issuers shall have furnished to you such other documents and
certificates as to the accuracy and completeness of any statement in the
Registration Statement or the Prospectus as you reasonably may request.
-21-
(k) You shall have been furnished with such additional documents and
certificates as you or counsel for the Underwriters may reasonably request.
All such opinions, certificates, letters and other documents will be
in compliance with the provisions hereof only if they are reasonably
satisfactory in form and substance to you and your counsel.
Any certificate or document signed by any officer of the Issuers and
delivered to you or to your counsel shall be deemed a representation and
warranty by the Issuers to the Underwriters as to the statements made therein.
9. Default by an Underwriter. If any one Underwriter shall fail to
purchase and pay for any of the Notes agreed to be purchased by such Underwriter
hereunder and such failure to purchase shall constitute a default in the
performance of its or their obligations under this Agreement, the remaining
Underwriters shall be obligated severally to take up and pay for (in the
respective proportions which the principal amount of Notes set forth opposite
their names in Schedule A hereto bears to the aggregate principal amount of
Notes set forth opposite the names of all the remaining Underwriters) the Notes
which the defaulting Underwriter or Underwriters agreed but failed to purchase;
provided, however, that in the event that the aggregate principal amount of
Notes which the defaulting Underwriter or Underwriters agreed but failed to
purchase shall exceed 10% of the aggregate principal amount of Notes set forth
in Schedule A hereto, the remaining Underwriters shall have the right to
purchase all, but shall not be under any obligation to purchase any, of the
Notes, and if such non-defaulting Underwriters do not purchase all the Notes,
this Agreement will terminate without liability to any non-defaulting
Underwriter or the Company. In the event of a default by any Underwriter as set
forth in this Section 9, the Closing Date shall be postponed for such period,
not exceeding five business days, as Banc of America shall determine in order
that the required changes in the Prospectus or in any other documents or
arrangements may be effected. Nothing contained in this Agreement shall relieve
any defaulting Underwriter of its liability, if any, to the Company or any
non-defaulting Underwriter for damages occasioned by its default hereunder.
10. Termination.
This Agreement may be terminated at any time prior to the Closing Date
by you by written notice to the Issuers if any of the following has occurred:
(i) since the respective dates as of which information is given in the
Registration Statement and the Prospectus, any material adverse change or
development involving a prospective material adverse change in the condition,
financial or otherwise, of the Company and its subsidiaries or the earnings,
affairs, or business prospects of the Company and its subsidiaries taken as a
whole, whether or not arising in the ordinary course of business, which would,
in your judgment, make it impracticable to market the Securities on the terms
and in the manner contemplated in the Prospectus, (ii) any outbreak or
escalation of hostilities or other national or international calamity or crisis
or change in economic conditions or in the financial markets of the United
States or
-22-
elsewhere that, in your judgment, is material and adverse and would, in your
judgment, make it impracticable to market the Securities on the terms and in the
manner contemplated in the Prospectus, (iii) the suspension or material
limitation of trading in securities on the New York Stock Exchange, the American
Stock Exchange or the Nasdaq National Market or limitation on prices for
securities on any such exchange, (iv) the enactment, publication, decree or
other promulgation of any federal or state statute, regulation, rule or order of
any court or other governmental authority which in your opinion materially and
adversely affects, or will materially and ad versely affect, the business or
operations of the Company and its subsidiaries taken as a whole, (v) the
declaration of a banking moratorium by either federal or New York State
authorities or (vi) the taking of any action by any federal, state or local
government or agency in respect of its monetary or fiscal affairs which in your
opinion has a material adverse effect on the financial markets in the United
States.
11. Miscellaneous. Notices given pursuant to any provision of this
Agreement shall be addressed as follows: (a) if to the Issuers, to ▇.▇. ▇▇▇▇▇▇,
Inc., ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: Chief
Financial Officer and (b) if to the Underwriters, to c/o Banc of America
Securities LLC, ▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Legal
Department, or in any case to such other address as the person to be notified
may have requested in writing.
The respective indemnities, contribution agreements, representations,
warranties and other statements of the Company, its officers and directors (in
their capacities as such) and of the Underwriters set forth in or made pursuant
to this Agreement shall remain operative and in full force and effect, and will
survive delivery of and payment for the Securities, regardless of (i) any
investigation, or statement as to the results thereof, made by or on behalf of
the Underwriters or by or on behalf of the Company, the officers or directors of
the Company or any controlling person of the Company (in their capacities as
such), (ii) acceptance of the Securities and payment for them hereunder and
(iii) termination of this Agreement.
If this Agreement shall be terminated by the Underwriters because of
any failure or refusal on the part of any Issuer to perform any of its
agreements in this Agreement or to fulfill any of the conditions of Section 8 of
this Agreement, the Issuers, jointly and severally, agree to reimburse the
Underwriters for all out-of-pocket expenses (including the fees and
disbursements of counsel) reasonably incurred by it.
Except as otherwise provided, this Agreement has been and is made
solely for the benefit of and shall be binding upon the Issuers, the
Underwriters, any controlling persons referred to herein, the other indemnitees
referred to herein and their respective successors and assigns, all as and to
the extent provided in this Agreement, and no other person shall acquire or have
any right under or by virtue of this Agreement. The term "successors and
assigns" shall not include a purchaser of any of the Securities from any
Underwriter merely because of such purchase.
-23-
This Agreement shall be governed and construed in accordance with the
laws of the State of New York.
This Agreement may be signed in various counterparts which together
shall constitute one and the same instrument.
References herein to "your judgment" or "your opinion" shall be deemed
to be the judgment or opinion, as the case may be, of Banc of America only.
[Signature Pages Follow]
Please confirm that the foregoing correctly sets forth the agreement
between the Issuers and the Underwriters.
Very truly yours,
▇.▇. ▇▇▇▇▇▇, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Executive Vice President, Treasurer and
Chief Financial Officer
S-1
GUARANTORS:
C. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ BUILDERS, INC.
CHI CONSTRUCTION COMPANY
CHTEX OF TEXAS, INC.
CONTINENTAL HOMES, INC.
CONTINENTAL HOMES OF FLORIDA, INC.
CONTINENTAL RESIDENTIAL, INC.
▇.▇. ▇▇▇▇▇▇, INC. - BIRMINGHAM
▇.▇. ▇▇▇▇▇▇, INC. - CHICAGO
▇.▇. ▇▇▇▇▇▇, INC. - DENVER
▇.▇. ▇▇▇▇▇▇, INC. - ▇▇▇▇▇-▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇, INC. - GREENSBORO
▇.▇. ▇▇▇▇▇▇, INC. - JACKSONVILLE
▇.▇. ▇▇▇▇▇▇, INC. - LOUISVILLE
▇.▇. ▇▇▇▇▇▇, INC. - MINNESOTA
▇.▇. ▇▇▇▇▇▇, INC. - NEW JERSEY
▇.▇. ▇▇▇▇▇▇, INC. - PORTLAND
▇.▇. ▇▇▇▇▇▇, INC. - SACRAMENTO
▇.▇. ▇▇▇▇▇▇, INC. - TORREY
▇.▇. ▇▇▇▇▇▇ LOS ANGELES HOLDING COMPANY, INC.
▇.▇. ▇▇▇▇▇▇ SAN DIEGO HOLDING COMPANY, INC.
DRH CAMBRIDGE HOMES, INC.
DRH CONSTRUCTION, INC.
DRH REGREM III, INC.
DRH REGREM IV, INC.
DRH REGREM V, INC.
DRH SOUTHWEST CONSTRUCTION, INC.
DRH TITLE COMPANY OF COLORADO, INC.
DRH TUCSON CONSTRUCTION, INC.
DRHI, INC.
KDB HOMES, INC.
▇▇▇▇▇▇▇ I, LTD.
▇▇▇▇▇▇▇ VIII, LTD.
▇▇▇▇▇▇▇ IX, INC.
▇▇▇▇▇▇▇ X, INC.
THE CLUB AT PRADERA, INC. (formerly DRH REGREM II, INC.)
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Treasurer
S-3
CH INVESTMENTS OF TEXAS, INC.
▇▇▇▇▇▇▇ II, LTD.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
-------------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇
President
S-4
CONTINENTAL HOMES OF TEXAS, L.P.
By: CHTEX of Texas, Inc., its general partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Treasurer
▇.▇. ▇▇▇▇▇▇ MANAGEMENT COMPANY, LTD.
▇.▇. ▇▇▇▇▇▇ - EMERALD, LTD.
▇.▇. ▇▇▇▇▇▇ - TEXAS, LTD.
DRH REGREM VII, LP
By: ▇▇▇▇▇▇▇ I, Ltd., its general partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Treasurer
SGS COMMUNITIES AT GRANDE QUAY, LLC
By: ▇▇▇▇▇▇▇ IX, Inc., a member
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Treasurer
and
By: ▇▇▇▇▇▇▇ X, Inc., a member
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Treasurer
DRH CAMBRIDGE HOMES, LLC
DRH REGREM VIII, LLC
By: ▇.▇. ▇▇▇▇▇▇, Inc. - Chicago, a member
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Treasurer
S-5
ALLEGRA, LLC
APLAM, LLC
WESTERN PACIFIC HOUSING CO.
WESTERN PACIFIC HOUSING-ANTIGUA, LLC
WESTERN PACIFIC HOUSING-AVIARA, L.P.
WESTERN PACIFIC HOUSING-BOARDWALK, LLC
WESTERN PACIFIC HOUSING-BROADWAY, LLC
WESTERN PACIFIC HOUSING-CANYON PARK, LLC
WESTERN PACIFIC HOUSING-CARMEL, LLC
WESTERN PACIFIC HOUSING-▇▇▇▇▇▇▇▇, LLC
WESTERN PACIFIC HOUSING-COMMUNICATIONS HILL, LLC
WESTERN PACIFIC HOUSING-CREEKSIDE, LLC
WESTERN PACIFIC HOUSING-▇▇▇▇▇▇ CITY, L.P.
WESTERN PACIFIC HOUSING-LOMAS VERDES, LLC
WESTERN PACIFIC HOUSING-LOST HILLS PARK, LLC
WESTERN PACIFIC HOUSING-▇▇▇▇▇▇▇▇▇ CANYON, LLC
WESTERN PACIFIC HOUSING-MOUNTAINGATE, L.P.
WESTERN PACIFIC HOUSING-NORCO ESTATES, LLC
WESTERN PACIFIC HOUSING-OSO, L.P.
WESTERN PACIFIC HOUSING-PARK AVENUE EAST, LLC
WESTERN PACIFIC HOUSING-PARK AVENUE WEST, LLC
WESTERN PACIFIC HOUSING-PLAYA VISTA, LLC
WESTERN PACIFIC HOUSING-ROBINHOOD RIDGE, LLC
WESTERN PACIFIC HOUSING-SANTA FE, LLC
WESTERN PACIFIC HOUSING-SCRIPPS II, LLC
WESTERN PACIFIC HOUSING-SCRIPPS, L.P.
WESTERN PACIFIC HOUSING-SEACOVE, L.P.
WESTERN PACIFIC HOUSING-STUDIO 528, LLC
WESTERN PACIFIC HOUSING-TERRA BAY DUETS, LLC
WESTERN PACIFIC HOUSING-TORRANCE, LLC
WESTERN PACIFIC HOUSING-TORREY COMMERCIAL, LLC
WESTERN PACIFIC HOUSING-▇▇▇▇▇▇ ▇▇▇▇▇▇▇, LLC
WESTERN PACIFIC HOUSING-TORREY MULTI-FAMILY, LLC
WESTERN PACIFIC HOUSING-TORREY VILLAGE CENTER, LLC
WESTERN PACIFIC HOUSING-VINEYARD TERRACE, LLC
WESTERN PACIFIC HOUSING-WINDEMERE, LLC
WESTERN PACIFIC HOUSING-WINDFLOWER, L.P.
WPH-CAMINO ▇▇▇▇, LLC
WPH-HPH, LLC
By: LAMCO Housing, Inc.,
its Member or General Partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
S-6
▇▇▇▇▇▇▇ HOMES OF ARIZONA LLC
SHA CONSTRUCTION LLC
By: SRHI LLC,
its Member
By: SLHR of Nevada, Inc.,
its Member
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
HPH HOMEBUILDERS 2000 ▇.▇.
▇▇▇▇▇▇ GP LLC
By: WPH-HPH, LLC,
its General Partner or Member
By: LAMCO Housing, Inc.,
its Member
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
AP LHI, INC.
AP WESTERN GP CORPORATION
AP WP OPERATING CORPORATION
LAMCO HOUSING, INC.
MELODY HOMES, INC.
MELMORT CO.
▇▇▇▇▇▇▇ HOMES OF CALIFORNIA, INC.
▇▇▇▇▇▇▇ HOMES OF OREGON, INC.
▇▇▇▇▇▇▇ HOMES OF WASHINGTON, INC.
▇▇▇▇▇▇▇ MORTGAGE, INC.
▇▇▇▇▇▇▇ REALTY HAWAII, INC.
SHLR OF CALIFORNIA, INC.
SHLR OF COLORADO, INC.
SHLR OF NEVADA, INC.
SHLR OF UTAH, INC.
SHLR OF WASHINGTON, INC.
VERTICAL CONSTRUCTION CORPORATION
WESTERN PACIFIC FUNDING, INC.
WESTERN PACIFIC HOUSING MANAGEMENT, INC.
WESTERN PACIFIC HOUSING, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
S-7
▇.▇. ▇▇▇▇▇▇-▇▇▇▇▇▇▇ HOMES, LLC
By: Vertical Construction Corporation,
its Manager
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
SRHI LLC
By: SHLR of Nevada, Inc.,
its Member
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
SSHI LLC
By: SHLR of Washington, Inc.,
its Member
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
WESTERN PACIFIC HOUSING-COPPER CANYON, LLC
WESTERN PACIFIC HOUSING-PACIFIC PARK II, LLC
WESTERN PACIFIC HOUSING-POINSETTIA, L.P.
WESTERN PACIFIC HOUSING-DEL ▇▇▇▇▇, LLC
By: AP Western GP Corporation,
its Member or General Partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
WESTERN PACIFIC HOUSING-RIVER RIDGE, LLC
By: AP LHI, Inc.,
its Member
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
AP WP PARTNERS, L.P.
By: AP WP Operating Corporation,
its General Partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
S-8
Agreed and accepted as of the
date first written above:
BANC OF AMERICA SECURITIES LLC
WACHOVIA SECURITIES, INC.
By: BANC OF AMERICA SECURITIES LLC
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: Managing Director
BANC ONE CAPITAL MARKETS, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing Director
