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EXHIBIT 99.1
OUTDOOR SYSTEMS, INC.
$500,000,000
8 7/8% Senior Subordinated Notes due 2007
PURCHASE AGREEMENT
June 17, 1997
CIBC WOOD GUNDY SECURITIES CORP.
ALEX. ▇▇▇▇▇ & SONS INCORPORATED
▇▇▇▇▇▇▇▇▇, LUFKIN & ▇▇▇▇▇▇▇▇
SECURITIES CORPORATION
c/o CIBC Wood Gundy Securities Corp.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Outdoor Systems, Inc., a Delaware corporation (the "Company"),
and each of the Company's subsidiaries listed in Exhibit A hereto (each, a
"Subsidiary Guarantor" and, collectively, the "Subsidiary Guarantors" and,
together with the Company, the "Issuers") hereby confirm their agreement with
you (the "Initial Purchasers"), as set forth below.
1. The Securities. Subject to the terms and conditions herein
contained, the Company proposes to issue and sell to the Initial Purchasers
$500,000,000 aggregate principal amount of its 8 7/8% Senior Subordinated Notes
due 2007 (the "Notes"). The obligations of the Company under the Indenture (as
hereinafter defined) and the Notes will be unconditionally guaranteed (the
"Guarantees"), on a joint and several basis, by each Subsidiary Guarantor. The
Notes and the Guarantees are to be issued pursuant to the Indenture (the
"Indenture"), dated as of June 23, 1997, among the Company, The Bank of New
York, a New York banking corporation, as trustee (the "Trustee"), and the
Subsidiary Guarantors. The Notes and the Guarantees are hereinafter referred to
collectively as the "Securities."
The Notes will be offered and sold to the Initial Purchasers
without such offers and sales being registered under the Securities Act of 1933,
as amended (together with the rules and regulations of the Commission
promulgated thereunder, the "Act"), in reliance on exemptions therefrom.
In connection with the sale of the Notes, the Company has
prepared a preliminary offering memorandum dated June 10, 1997 (including the
documents incorporated by reference therein,
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the "Preliminary Memorandum"), and a final offering memorandum dated June 17,
1997 (including the documents incorporated by reference therein, the "Final
Memorandum"; the Preliminary Memorandum and the Final Memorandum each herein
being referred to as a "Memorandum") each setting forth or including a
description of the terms of the Notes, the terms of the offering of the Notes, a
description of the Company and its subsidiaries and any material developments
relating to the Company and its subsidiaries occurring after the date of the
most recent historical financial statements included therein.
The Company and the Subsidiary Guarantors understand that the
Initial Purchasers propose to make an offering of the Notes only on the terms
and in the manner set forth in the Memorandum and Section 9 hereof as soon as
the Initial Purchasers deem advisable after this Agreement has been executed and
delivered, to persons in the United States whom the Initial Purchasers
reasonably believe to be qualified institutional buyers ("QIBs") as defined in
Rule 144A under the Act, as such rule may be amended from time to time ("Rule
144A"), in transactions under Rule 144A, and to a limited number of
institutional "accredited investors" ("Accredited Investors"), as defined in
Rule 501(a)(1), (2), (3) and (7) under Regulation D of the Act in private sales
exempt from registration under the Act, and outside the United States to certain
persons in reliance on Regulation S under the Act.
The Initial Purchasers and their direct and indirect
transferees of the Notes will be entitled to the benefits of the Registration
Rights Agreement (the "Registration Rights Agreement"), dated as of June 17,
1997 among the parties hereto pursuant to which the Issuers have agreed, among
other things, to file (i) a registration statement (the "Registration
Statement") with the Securities and Exchange Commission (the "Commission")
registering the Notes or the Exchange Notes (as defined in the Registration
Rights Agreement) under the Act or (ii) a shelf registration statement pursuant
to Rule 415 under the Act relating to the resale of the Notes, by holders
thereof or, if applicable, relating to the resale of Private Exchange Notes (as
defined in the Registration Rights Agreement) by the Initial Purchasers pursuant
to an exchange of the Notes for Private Exchange Notes.
2. Representations and Warranties of the Issuers. The Issuers,
jointly and severally, represent and warrant to and agree with the Initial
Purchasers that:
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(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 at all times subsequent thereto up to the Closing
Date (as defined in Section 3 below) contained or contains any untrue
statement of a material fact or omitted or omits to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except that
the representations and warranties set forth in this Section 2 do not
apply to statements or omissions made in reliance upon and in
conformity with information relating to the Initial Purchasers
furnished to the Company in writing by the Initial Purchasers expressly
for use in the Preliminary Memorandum, the Final Memorandum or any
amendment or supplement thereto. The documents incorporated or deemed
to be incorporated by reference in any Memorandum, at the time they
were or hereafter are filed with the Commission complied and will
comply in all material respects with the requirements of the Securities
Exchange Act of 1934, as amended (together with the rules and
regulations of the Commission promulgated thereunder, the "Exchange
Act").
(b) Each of the Company and its subsidiaries set forth in
Exhibit B hereto (the "Subsidiaries") has been duly incorporated and
each of the Company and the Subsidiaries is validly existing in good
standing as a corporation under the laws of its jurisdiction of
incorporation, with the requisite corporate power and authority to own
its properties and conduct its business as now conducted as described
in the Final Memorandum (or, if the Final Memorandum is not in
existence, the most recent Preliminary Memorandum) and is duly
qualified to do business as a foreign corporation 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 business,
condition (financial or other), prospects or results of operations of
the Company and the Subsidiaries, taken as a whole, (any such event, a
"Material Adverse Effect"); the Company had as of the date specified
therein the authorized, issued and outstanding capitalization set forth
in the Final Memorandum (or, if the Final Memorandum is not in
existence, the most recent Preliminary Memorandum); except as set forth
in Exhibit B hereto, the Company does not have any subsidiaries or own
directly or indirectly any of the capital stock or other
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equity securities of any other person; all of the outstanding shares of
capital stock of the Company and the Subsidiaries have been 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 (or, if the Final
Memorandum is not in existence, the most recent Preliminary
Memorandum), all of the outstanding shares of capital stock of the
Subsidiaries are owned, directly or indirectly, by the Company, free
and clear of all liens, encumbrances, equities and restrictions on
transferability (other than those imposed by the Act and the state
securities or "Blue Sky" laws); except as set forth in the Final
Memorandum (or, if the Final Memorandum is not in existence, the most
recent Preliminary Memorandum) and employee stock options granted by
the Company since March 31, 1997, no options, warrants or other rights
to purchase from the Company or any Subsidiary, agreements or other
obligations of the Company or any Subsidiary to issue or other rights
to convert any obligation into, or exchange any securities for, shares
of capital stock of or ownership interests in the Company or any
Subsidiary are outstanding; and no holder of securities of the Company
or any Subsidiary is entitled to have such securities registered under
the Registration Statement.
(c) The Securities have been duly and validly authorized by
each of the Issuers for issuance and when executed by the Issuers and
authenticated by the Trustee in accordance with the provisions of the
Indenture, and delivered to and paid for by the Initial Purchasers in
accordance with the terms hereof, will have been duly executed, issued
and delivered and will constitute valid and legally binding obligations
of the Issuers, entitled to the benefits of the Indenture and
enforceable against the Issuers in accordance with their terms except
that the enforcement thereof may be limited by (i) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to or affecting creditors' rights
generally or (ii) general principles of equity and the discretion of
the court before which any proceeding therefor may be brought
(regardless of whether such enforcement is considered in a proceeding
at law or in equity); each of the Issuers has all requisite corporate
power and authority to execute, deliver and perform its obligations
under the Indenture and the Securities; and the Indenture has been duly
and validly authorized by the Issuers and meets the requirements for
qualification under the Trust Indenture Act of 1939, as amended (the
"Trust
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Indenture Act"), and, when executed and delivered by the Issuers
(assuming the due authorization, execution and delivery by the
Trustee), will constitute a valid and legally binding agreement of the
Issuers, enforceable against the Issuers in accordance with its terms
except that the enforcement thereof may be limited by (i) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to or affecting creditors' rights
generally or (ii) general principles of equity and the discretion of
the court before which any proceeding therefor may be brought
(regardless of whether such enforcement is considered in a proceeding
at law or in equity).
(d) Each of the Issuers has the requisite corporate power and
authority to execute, deliver and perform its obligations under this
Agreement. This Agreement has been duly and validly authorized by the
Issuers and, when executed and delivered by the Issuers, will
constitute a valid and legally binding agreement of the Issuers,
enforceable against the Issuers in accordance with its terms except (i)
that the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in
effect relating to or affecting creditors' rights generally or general
principles of equity and the discretion of the court before which any
proceeding therefor may be brought (regardless of whether such
enforcement is considered in a proceeding at law or in equity) and (ii)
as any rights to indemnity or contribution hereunder may be limited by
federal and state securities laws and public policy considerations.
(e) Each of the Issuers has the requisite corporate power and
authority to execute, deliver and perform its obligations under the
Registration Rights Agreement. The Registration Rights Agreement has
been duly and validly authorized by the Issuers and, when executed and
delivered by the Issuers, will constitute a valid and legally binding
agreement of the Issuers, enforceable against the Issuers in accordance
with its terms except (i) that the enforcement thereof may be limited
by bankruptcy, insolvency, reorganization, moratorium or other similar
laws now or hereafter in effect relating to or affecting creditors'
rights generally or general principles of equity and the discretion of
the court before which any proceeding therefor may be brought
(regardless of whether such enforcement is considered in a proceeding
at law or in equity) and (ii) as any rights to indemnity or
contribution hereunder may be
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limited by federal and state securities laws and public policy
considerations.
(f) No consent, approval, authorization or order of any court
or governmental agency or body is required for the performance of this
Agreement, the Registration Rights Agreement, the Securities or the
Indenture by the Issuers or to the consummation by the Issuers of any
of the transactions contemplated hereby and thereby, or the application
of the proceeds of the issuance of the Securities as described in the
Final Memorandum (or, if the Final Memorandum is not in existence, the
most recent Preliminary Memorandum), except as may be required under
state securities or "Blue Sky" laws in connection with the purchase and
distribution of the Securities by the Initial Purchasers; and none of
the Issuers is (i) in violation of its certificate of incorporation or
bylaws, (ii) in violation of any statute, judgment, decree, order, rule
or regulation applicable to it or any of its properties or assets,
which violation would, individually or in the aggregate, have a
Material Adverse Effect, or (iii) in default in the performance or
observance of any obligation, agreement, covenant or condition
contained in this Agreement, the Registration Rights Agreement, the
Securities or the Indenture or any other contract, indenture, mortgage,
deed of trust, loan agreement, note, lease, license, franchise
agreement, permit, certificate or agreement or instrument to which it
is a party or to which it is subject, which default would, individually
or in the aggregate, have a Material Adverse Effect.
(g) The execution, delivery and performance by the Issuers of
this Agreement, the Registration Rights Agreement, the Securities and
the Indenture and the consummation by the Issuers of the transactions
contemplated hereby and thereby and the fulfillment of the terms hereof
and thereof, will not violate, conflict with or constitute or result in
a breach of or a default under (or an event that, with notice or lapse
of time, or both, would constitute a breach of or a default under) any
of (a) the terms or provisions of any contract, indenture, mortgage,
deed of trust, loan agreement, note, lease, license, franchise
agreement, permit, certificate or agreement or instrument to which any
of the Company or the Subsidiaries is a party or to which any of their
respective properties or assets are subject, which violation, conflict,
breach or default would, individually or in the aggregate, have a
Material Adverse Effect, (b) the certificate of
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incorporation or bylaws of any of the Company or the Subsidiaries (or
any similar organizational documents) or (assuming compliance with all
applicable state securities or "Blue Sky" laws) any statute, judgment,
decree, order, rule or regulation of any court or governmental agency
or other body applicable to the Company or the Subsidiaries or any of
their respective properties or assets, which violation, conflict,
breach or default would, individually or in the aggregate, have a
Material Adverse Effect.
(h) The audited consolidated financial statements included in
the Final Memorandum (or, if the Final Memorandum is not in existence,
the most recent Preliminary Memorandum) present fairly the consolidated
financial position, results of operations and cash flows of the
entities to which they relate at the dates and for the periods to which
they relate and have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis, except as
otherwise stated therein; the unaudited consolidated financial
statements and the related notes included in the Final Memorandum (or,
if the Final Memorandum is not in existence, the most recent
Preliminary Memorandum) present fairly the consolidated financial
position, results of operations and cash flows of such entities at the
dates and for the periods to which they relate, subject to year end
audit adjustments and have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis except as
otherwise stated therein and have been prepared on a basis
substantially consistent with that of the audited financial statements
referred to above except as otherwise stated therein; the summary and
selected financial and statistical data included in the Final
Memorandum (or, if the Final Memorandum is not in existence, the most
recent Preliminary Memorandum) present fairly 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; and Deloitte & Touche LLP, which has examined certain
of such financial statements as set forth in its reports included in
the Final Memorandum, is an independent public accounting firm as
required by the Act.
(i) The pro forma financial statements and other pro forma
financial information (including the notes thereto) included in the
Final Memorandum (or, if the Final Memorandum is not in existence, the
most recent Preliminary Memorandum) (A) have been prepared in
accordance with applicable requirements of Regulation S-X promulgated
under
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the Exchange Act and (B) have been properly computed on the bases
described therein; and the assumptions used in the preparation of the
pro forma financial statements and other pro forma financial
information included in the Final Memorandum (or, if the Final
Memorandum is not in existence, the most recent Preliminary Memorandum)
are reasonable and the adjustments used therein are appropriate to give
effect to the transactions or circumstances referred to therein.
(j) Except as described in the Final Memorandum (or, if the
Final Memorandum is not in existence, the most recent Preliminary
Memorandum), there is not pending or, to the best knowledge of the
Issuers, threatened any action, suit, proceeding, inquiry or
investigation, governmental or otherwise, to which any of the Company
or the Subsidiaries is a party, or to which their respective properties
or assets are subject, before or brought by any court, arbitrator or
governmental agency or body, that, if determined adversely to the
Company or the Subsidiaries would, individually or in the aggregate,
have a Material Adverse Effect or that seeks to restrain, enjoin,
prevent the consummation of or otherwise challenge the issuance or sale
of the Securities to be sold hereunder or the application of the
proceeds therefrom or the other transactions described in the Final
Memorandum.
(k) None of the Company or the Subsidiaries has any liability
for any prohibited transaction or funding deficiency or any complete or
partial withdrawal liability with respect to any pension, profit
sharing or other plan which is subject to the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), to which any of the
Company or the Subsidiaries makes or ever has made a contribution and
in which any employee of any of the Company or the Subsidiaries is or
has ever been a participant which liability or deficiency would,
individually or in the aggregate, have a Material Adverse Effect. With
respect to such plans, the Company and the Subsidiaries are in
compliance in all respects with all provisions of ERISA except for any
non-compliance that would not, individually or in the aggregate, have a
Material Adverse Effect.
(l) The Company and the Subsidiaries own or possess adequate
licenses or other rights to use all patents, trademarks, service marks,
trade names, copyrights and know-how that are necessary to conduct
their business as described in the Final Memorandum (or, if the Final
Memorandum is not in existence, the most recent Preliminary
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Memorandum) except to the extent the failure to own or possess such
licenses or other rights would, individually or in the aggregate, not
have a Material Adverse Effect.
(m) None of the Company or 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 that, if such assertion of infringement or
conflict were sustained, would, individually or in the aggregate, have
a Material Adverse Effect.
(n) Each of the Company and the Subsidiaries has obtained all
licenses, permits, franchises and other governmental authorizations,
the lack of which would, individually or in the aggregate, have a
Material Adverse Effect.
(o) Subsequent to the respective dates as of which information
is given in the Final Memorandum (or, if the Final Memorandum is not in
existence, the most recent Preliminary Memorandum) and except as
described therein, (i) the Company and the Subsidiaries have not
incurred any material liabilities or obligations, direct or contingent,
or entered into any material transactions, in either case whether or
not in the ordinary course of business, and (ii) the Company and the
Subsidiaries have not purchased any of their respective outstanding
capital stock, or, except for a three-for-two stock split to be
effected by the Company as a stock dividend payable on July 3, 1997 to
shareholders of record on June 23, 1997, declared, paid or otherwise
made any dividend or distribution of any kind on any of their
respective capital stock or otherwise.
(p) There are no legal or governmental proceedings that would
be required to be described in a Registration Statement on Form S-3
under the Act that are not described in the Final Memorandum (or, if
the Final Memorandum is not in existence, the most recent Preliminary
Memorandum) nor are there any contracts or other documents that would
be required to be described in a Registration Statement on Form S-3
under the Act that are not described in the Final Memorandum (or, if
the Final Memorandum is not in existence, the most recent Preliminary
Memorandum). Except as described in the Final Memorandum (or, if the
Final Memorandum is not in existence, the most recent Preliminary
Memorandum), none of the Company or the Subsidiaries is in
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default under any of the contracts described in the Final Memorandum
(or, if the Final Memorandum is not in existence, the most recent
Preliminary Memorandum), has received a notice or claim of any such
default or has knowledge of any breach of such contracts by the other
party or parties thereto, except such defaults or breaches as would
not, individually or in the aggregate, have a Material Adverse Effect.
(q) None of the Company or the Subsidiaries has taken or will
take any action that would cause this Agreement or the issuance or sale
of the Securities 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.
(r) Each of the Company and the Subsidiaries has good and
marketable title to all real property described in the Final Memorandum
(or, if the Final Memorandum is not in existence, the most recent
Preliminary Memorandum) as being owned by it and good title to the
leasehold estate in the real property described therein as being leased
by it, free and clear of all liens, charges, encumbrances or
restrictions, except, in each case, as described in the Final
Memorandum (or, if the Final Memorandum is not in existence, the most
recent Preliminary Memorandum) or such as would not, individually or in
the aggregate, have a Material Adverse Effect. All leases, contracts
and agreements, including those referred to in the Final Memorandum
(or, if the Final Memorandum is not in existence, the most recent
Preliminary Memorandum) to which the Company or any of the Subsidiaries
is a party or by which any of them is bound are valid and enforceable
against the Company or any such Subsidiary, and are, to the knowledge
of the Issuers, valid and enforceable against the other party or
parties thereto and are in full force and effect with only such
exceptions as would not, individually or in the aggregate, have a
Material Adverse Effect.
(s) Each of the Company and the Subsidiaries has filed all
necessary federal, state and foreign income and franchise tax returns
and have paid all taxes shown as due thereon, except where the failure
to so file such returns or pay such taxes would not, individually or in
the aggregate, have a Material Adverse Effect; and other than tax
deficiencies which the Company or any Subsidiary is contesting in good
faith and for which adequate reserves have been provided, there is no
tax deficiency that has been
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asserted against the Company or any Subsidiary that would, individually
or in the aggregate, have a Material Adverse Effect.
(t) (i) Immediately after the consummation of the transactions
contemplated by the Agreement, the fair value and present fair saleable
value of the assets of each of the Company and the Subsidiaries will
exceed the sum of its stated liabilities and identified contingent
liabilities; and (ii) each of the Company and the Subsidiaries is not,
nor will it be, after giving effect to the execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated hereby, (a) left with unreasonably small capital with
which to carry on its business as it is proposed to be conducted, (b)
unable to pay its debts (contingent or otherwise) as they mature or (c)
insolvent.
(u) Except as disclosed in the Final Memorandum (or, if the
Final Memorandum is not in existence, the most recent Preliminary
Memorandum), and except as would not individually or in the aggregate
have a Material Adverse Effect (A) each of the Company and the
Subsidiaries is in compliance with all applicable Environmental Laws
(as hereinafter defined), (B) each of the Company and the Subsidiaries
has made all filings and provided all notices required under any
applicable Environmental Law, and has all permits, authorizations and
approvals required under any applicable Environmental Laws and is in
compliance with their requirements, (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 best knowledge of the
Issuers, threatened against the Company or any of the Subsidiaries
under any Environmental Law, (D) no Lien 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) neither the Company nor any of 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 (ii) listed in the
Comprehensive Environmental Response, Compensation, Liability
Information System List promulgated pursuant to
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CERCLA, or on any comparable list maintained by any state or local
governmental authority.
For purposes of this Agreement, "Environmental Law" means any
federal, state, local or municipal statute, law, rule, regulation,
ordinance, code, policy or rule of common law and any judicial or
administrative interpretation thereof, including any judicial or
administrative order, consent decree or judgment binding on any of the
Issuers or the Subsidiaries, relating to pollution or protection of the
environment or health or safety or any chemical, material or substance,
that is subject to regulation thereunder.
(v) None of the Company or the Subsidiaries is required to
register as an "investment company" or a company "controlled by" an
"investment company" within the meaning of the Investment Company Act
of 1940, as amended.
(w) Except as stated in the Final Memorandum (or, if the Final
Memorandum is not in existence, the most recent Preliminary Memorandum)
none of the Company or the Subsidiaries or any of such entities'
directors, officers or controlling persons, has taken, directly or
indirectly, any action designed, or that might reasonably be expected,
to cause or result, under the Act or otherwise, in, or that has
constituted, stabilization or manipulation of the price of any security
of any Issuer to facilitate the sale or resale of the Securities (it
being understood that no representation or warranty is made as to any
actions by the Initial Purchasers).
(x) None of the Company, the Subsidiary Guarantors or any of
their respective Affiliates (as defined in rule 501(b) of Regulation D
under the Act) directly, or through any agent, (i) sold, offered for
sale, solicited offers to buy or otherwise negotiated in respect of,
any "security" (as defined in the Act) which is or could be integrated
with the sale of the Securities in a manner that would require the
registration under the Act of the Securities or (ii) assuming the
accuracy of the representations and warranties of the Initial
Purchasers in Section 9 hereof, 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
Securities or in any manner involving a public offering within the
meaning of Section 4(2) of the Act. Assuming (i) the accuracy of the
representations and warranties of the Initial Purchasers in Section 9
hereof,
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(ii) the due performance by the Initial Purchasers of the covenants and
agreement set forth in Section 9 hereof, and (iii) the compliance by
the Initial Purchasers with the transfer restrictions described under
the caption "Notice to Investors" in the Final Memorandum, it is not
necessary in connection with the offer, sale and delivery of the
Securities to the Initial Purchasers in the manner contemplated by this
Agreement to register any of the Securities under the Act or to qualify
the Indenture under the Trust Indenture Act.
(y) No securities of any Issuer are of the same class (within
the meaning of Rule 144A under the Act) as the Securities and listed on
a national securities exchange registered under Section 6 of the
Exchange Act, or quoted in a U.S. automated inter-dealer quotation
system.
3. Purchase, Sale and Delivery of the Securities. 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 each of the Initial Purchasers
severally agrees to purchase from the Company, at 97.309% of their principal
amount the respective aggregate principal amounts of the Notes set forth
opposite their respective names on Exhibit C hereto. The obligations of the
Initial Purchasers under this Agreement are several and not joint.
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 the
Initial Purchasers request upon notice to the Company at least 48 hours prior to
the Closing Date (as defined) shall be delivered by or on behalf of the Company,
against payment by or on behalf of the Initial Purchasers, of the purchase price
therefor by wire transfer of immediately available funds to the account of the
Company previously designated by it in writing. Such delivery of and payment for
the Notes and the related Guarantees shall be made at the offices of ▇▇▇▇▇▇
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, at 9:00 A.M., New
York time, on June 23, 1997, or at such date as the Initial Purchasers and the
Company 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 Securities available for checking and packaging by the
Initial Purchasers at the offices in New York, New York of CIBC Wood Gundy
Securities Corp. at least 24 hours prior to the Closing Date.
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4. Offering by the Initial Purchasers. The Initial Purchasers
propose to make an offering of the Securities 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. Certain Covenants. The Issuers jointly and severally
covenant and agree with the Initial Purchasers that:
(i) The Issuers will not amend or supplement the Final
Memorandum or any amendment or supplement thereto of which the Initial
Purchasers shall not have been advised and furnished a copy for a
reasonable period of time prior to the proposed amendment or supplement
and as to which the Initial Purchasers shall not have given their
consent (which consent shall not be unreasonably withheld). The Issuers
will promptly, upon the reasonable request of the Initial Purchasers or
counsel for the Initial Purchasers, make any amendments or supplements
to the Preliminary Memorandum or the Final Memorandum that may be
necessary in connection with the resale of the Securities by the
Initial Purchasers for such Final Memorandum not to contain any untrue
statement of a material fact or omission of a material fact necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading or to comply with applicable laws,
rules or regulations.
(ii) The Issuers will cooperate with the Initial Purchasers in
arranging for the qualification of the Securities for offering and sale
under the securities or "Blue Sky" laws of 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
Securities by the Initial Purchasers; provided, however, that in
connection therewith none of the Issuers shall be required to qualify
as a foreign corporation or to execute a general consent to service of
process in any jurisdiction or to take any other action that would
subject it to general service of process or to taxation in respect of
doing business in any jurisdiction in which it is not otherwise
subject.
(iii) If, at any time prior to the completion of the resale by
the Initial Purchasers of the Notes or the Private Exchange Notes any
event shall occur as a result of which it is necessary, in the opinion
of counsel for the Initial Purchasers, to amend or supplement the Final
Memorandum in order to make such Final Memorandum not misleading in the
15
-15-
light of the circumstances existing at the time it is delivered to a
purchaser, or if for any other reason it shall be necessary to amend or
supplement the Final Memorandum in order to comply with applicable
laws, rules or regulations, the Issuers shall (subject to Section 5(i))
forthwith amend or supplement such Final Memorandum so that, as so
amended or supplemented, such Final Memorandum will not include an
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances existing at the time it is delivered to a purchaser, not
misleading and will comply with applicable laws, rules or regulations,
and the Issuers will furnish to the Initial Purchasers, without charge,
a reasonable number of copies of such amendment or supplement.
(iv) The Issuers will, without charge, provide to the Initial
Purchasers and to counsel for the Initial Purchasers, as many copies of
each Preliminary Memorandum or Final Memorandum or any amendment or
supplement thereto as the Initial Purchasers may reasonably request.
(v) None of the Issuers or any of their respective 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 the Securities in a manner which
would require the registration under the Act of the Securities.
(vi) During the period of five years hereafter, the Company
will furnish to the Initial Purchasers (a) as soon as available, a copy
of each report or other communication (financial or otherwise) of the
Company mailed to the Trustee or holders of the Notes, stockholders or
filed with the Commission, and (b) from time to time such other
information concerning the Company as the Initial Purchasers may
reasonably request.
(vii) If this Agreement shall terminate or shall be terminated
after execution pursuant to any provisions hereof (other than by reason
of a default or omission by the Initial Purchasers of their obligations
hereunder) or if this Agreement shall be terminated by the Initial
Purchasers because of any failure or refusal on the part of the Issuers
to comply with the terms or fulfill any of the conditions of this
Agreement, the Company agrees to reimburse the Initial Purchasers for
all reasonable out-of-pocket expenses (including fees and expenses of
counsel for the Initial
16
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Purchasers) incurred by the Initial Purchasers in connection herewith,
but in no event will the Company be liable to the Initial Purchasers
for damages on account of loss of anticipated profits from the sale of
the Securities.
(viii) In connection with Securities offered and sold in an
offshore transaction (as defined in Regulation S), the Issuers will not
register any transfer of such Securities not made in accordance with
the provisions of Regulation S and will not, except in accordance with
the provisions of Regulation S, if applicable, issue any such
Securities in the form of definitive securities.
(ix) The Company will not, and will not permit any of its
Subsidiaries to, 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 Securities or in any manner
involving a public offering within the meaning of Section 4(2) of the
Act.
(x) For so long as any of the Securities remain outstanding,
the Company will make available at its expense, upon request, to any
holder of Securities and any prospective purchasers thereof 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.
(xi) The Issuers will use their best efforts to (i) permit the
Securities 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 Offerings,
Resales and Trading through Automated Linkages market (the "Portal
Market") and (ii) permit the Securities to be eligible for clearance
and settlement through The Depository Trust Company.
(xii) The Company will apply the net proceeds from the sale of
the Securities as set forth under "Use of Proceeds" in the Final
Memorandum.
(xiii) Prior to the Closing Date, the Company will furnish to
the Initial Purchasers, as soon as they have been prepared by or are
available to the Company, a copy of any unaudited interim consolidated
financial statements of the Company and the Subsidiaries, for any
period subsequent to the period covered by the most recent financial
statements appearing in the Final Memorandum.
17
-17-
6. Expenses. Notwithstanding any termination of this Agreement
(pursuant to Section 11 or otherwise), the Issuers jointly and severally agree
to pay the following costs and expenses and all other costs and expenses
incident to the performance by the Issuers of their obligations hereunder: (i)
the preparation, printing or reproduction of each Preliminary Memorandum, the
Final Memorandum and each amendment or supplement to any of them; (ii) the
printing (or reproduction) and delivery (including postage, air freight charges
and charges for counting and packaging) of such copies of each Preliminary
Memorandum, the Final Memorandum and all amendments or supplements to any of
them as may be reasonably requested for use in connection with the offering and
sale of the Securities; (iii) the preparation, printing, authentication,
issuance and delivery of certificates for the Securities, including any stamp
taxes in connection with the original issuance and sale of the Securities and
trustees' fees; (iv) the reproduction and delivery of this Agreement, the
preliminary and supplemental "Blue Sky" memoranda and all other agreements or
documents reproduced and delivered in connection with the offering of the
Securities; (v) the registration or qualification of the Securities for offer
and sale under the securities or Blue Sky laws of the several states (including
filing fees and the fees, expenses and disbursements of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇,
counsel to the Initial Purchasers, relating to such registration and
qualification); (vi) the transportation and other expenses incurred by or on
behalf of Company representatives in connection with presentations to
prospective purchasers of the Securities; (vii) the fees and expenses of the
Company's accountants and the fees and expenses of counsel (including local and
special counsel) for the Issuers; (viii) fees and expenses of the Trustee
including fees and expenses of its counsel; (ix) all expenses and listing fees
incurred in connection with the application for quotation of the Securities on
the PORTAL Market and (x) any fees charged by investment rating agencies for the
rating of the Securities.
7. Conditions of the Initial Purchaser's Obligations. The
obligation of the Initial Purchasers to purchase and pay for the Securities are
subject to the accuracy of the representations and warranties contained herein,
to the performance by the Issuers of their respective covenants and agreements
hereunder and to the following additional conditions unless waived in writing by
the Initial Purchasers:
(i) The Initial Purchasers shall have received an opinion of
counsel to the Issuers in form and substance satisfactory to the
Initial Purchasers and ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, counsel to the Initial
Purchasers, dated the
18
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Closing Date, of Powell, Goldstein, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, substantially
in the form of Exhibit D hereto. In rendering such opinion, Powell,
Goldstein, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP shall have received and may rely upon
such certificates and other documents and information, including one or
more opinions of local counsel reasonably acceptable to the Initial
Purchasers and ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, counsel to the Initial
Purchasers, as they may reasonably request to pass upon such matters.
(ii) The Initial Purchasers shall have received an opinion,
dated the Closing Date, of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, counsel to the
Initial Purchasers, with respect to the sufficiency of certain legal
matters relating to this Agreement and such other related matters as
the Initial Purchasers may require. In rendering such opinion, ▇▇▇▇▇▇
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ shall have received and may rely upon such
certificates and other documents and information as they may reasonably
request to pass upon such matters. In addition, in rendering its
opinion, ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ may state that its opinion is limited
to matters of New York, Delaware corporate and federal law.
(iii) The Initial Purchasers shall have received from Deloitte
& Touche LLP, independent public accountants for the Issuers, and from
Coopers & ▇▇▇▇▇▇▇ L.L.P., independent public accountants for National
Advertising Company, "comfort" letters dated the date hereof and the
Closing Date, in form and substance reasonably satisfactory to the
Initial Purchasers and ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, counsel to the Initial
Purchasers.
(iv) The representations and warranties of the Issuers
contained in this Agreement shall be true and correct on and as of the
Closing Date; the Issuers shall have complied in all material respects
with all agreements and satisfied all conditions on their part to be
performed or satisfied hereunder at or prior to the Closing Date.
(v) There shall not have been any change in the capital stock
of the Issuers nor any material increase in the consolidated short-term
or long-term debt of the Issuers from that set forth or contemplated in
the Final Memorandum and (b) the Issuers shall not have any liabilities
or obligations, contingent or otherwise (whether or not in the ordinary
course of business), that are material to the Issuers, taken as a
whole, other than those reflected in the Final Memorandum.
19
-19-
(vi) None of the issuance and sale of the Securities pursuant
to this Agreement or the Final Memorandum shall be enjoined
(temporarily or permanently) and no restraining order or other
injunctive order shall have been issued; and there shall not have been
any legal action, order, decree or other administrative proceeding
instituted or threatened against any of the Issuers or the Initial
Purchasers relating to the issuance of the Securities or the Initial
Purchasers' activities in connection therewith or any other
transactions contemplated by this Agreement or the Final Memorandum.
(vii) Subsequent to the effective date of this Agreement,
there shall not have occurred (i) any change, or any development
involving a prospective change, in or affecting the condition
(financial or other), business, properties, prospects or results of
operations of the Company and the Subsidiaries, taken as a whole, not
contemplated by the Final Memorandum that, in the opinion of the
Initial Purchasers, would materially adversely affect the market for
the Securities, or (ii) any event or development relating to or
involving any of the Company or the Subsidiaries or any of the officers
or directors of the Company or the Subsidiaries that makes any
statement made in the Final Memorandum untrue or that, in the opinion
of the Issuers and their counsel or the Initial Purchasers and their
counsel, requires the making of any addition to or change in the Final
Memorandum in order to state a material fact required by any applicable
law, rule or regulation to be stated therein or necessary in order to
make the statements made therein not misleading.
(viii) The Initial Purchasers shall have received
certificates, dated the Closing Date, and signed by the chief executive
officer and the chief financial officer of the Company and each
Subsidiary Guarantor (or such other officers as are acceptable to the
Initial Purchasers), to the effect that:
a. All of the representations and warranties of the
Issuers set forth in this Agreement are true and
correct as if made on and as of the Closing Date and
the Issuers have complied in all material respects
with all agreements and satisfied all conditions on
their part to be performed or satisfied at or prior
to the Closing Date.
20
-20-
b. None of the issuance and sale of the Securities
pursuant to this Agreement or the Final Memorandum
have been enjoined (temporarily or permanently)
and no restraining order or other injunctive order
has been issued and there has not been any legal
action, order, decree or other administrative
proceeding instituted or threatened against any of
the Issuers relating to the issuance of the
Securities or the Initial Purchasers' activities
in connection therewith or in connection with any
other transactions contemplated by this Agreement
or the Final Memorandum.
c. Subsequent to the effective date of this
Agreement, there has not occurred (i) any change,
or any development involving a prospective change,
in or affecting the condition (financial or
other), business, properties, prospects or results
of operations of the Company and the Subsidiaries,
taken as a whole, not contemplated by the Final
Memorandum that would materially adversely affect
the market for the Securities, or (ii) any event
or development relating to or involving any of the
Company or the Subsidiaries or any of the
respective officers or directors of the Company or
the Subsidiaries that makes any statement made in
the Final Memorandum untrue or that requires the
making of any addition to or change in the Final
Memorandum in order to state a material fact
required by any applicable law, rule or regulation
to be stated therein or necessary in order to make
the statements made therein not misleading.
d. There has not been any change in the capital stock
of the Company or the Subsidiaries nor any
material increase in the consolidated short-term
or long-term debt of the Company from that set
forth or contemplated in the Final Memorandum and
(b) the Company and the Subsidiaries have no
liabilities or obligations, contingent or
otherwise (whether or not in the ordinary course
of business), that are material to the Company and
the Subsidiaries, taken as a whole, other than
those reflected in the Final Memorandum.
(ix) The Issuers shall have furnished or caused to be
furnished to the Initial Purchasers such further
21
-21-
certificates and documents as the Initial Purchasers shall
have reasonably requested.
Any certificate or document signed by any officer of an Issuer
and delivered to the Initial Purchasers or to counsel for the Initial Purchasers
shall be deemed a representation and warranty by such Issuer to the Initial
Purchasers as to the statements made therein.
All such opinions, certificates, letters, schedules, documents
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 to the Initial Purchasers. The
Issuers shall furnish to the Initial Purchasers such conformed copies of such
opinions, certificates, letters, schedules, documents and instruments in such
quantities as the Initial Purchasers shall reasonably request.
8. Indemnification and Contribution. (a) Each Issuer jointly
and severally agrees to indemnify and hold harmless each of the Initial
Purchasers, and each person, if any, who controls the Initial Purchasers within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act, against
any losses, claims, damages or liabilities to which such Initial Purchasers or
such controlling persons may become subject under the Act, the Exchange Act or
otherwise, insofar as any such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon:
(i) any untrue statement or alleged untrue statement of any
material fact contained in (A) any Preliminary Memorandum or the Final
Memorandum or any amendment or supplement thereto or (B) any
application or other document, or any amendment or supplement thereto,
executed by any Issuer or based upon written information furnished by
or on behalf of any Issuer filed in any jurisdiction in order to
qualify the Securities under the securities or "Blue Sky" laws thereof
or filed with the Commission or any securities association or
securities exchange (each an "Application"); or
(ii) the omission or alleged omission to state, in any
Preliminary Memorandum or the Final 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 the
light of the circumstances under which they were made, not misleading,
22
-22-
and will reimburse, as incurred, the Initial Purchasers and each such
controlling person for any legal or other expenses reasonably incurred
by the Initial Purchasers or such controlling person in connection with
investigating, defending against or appearing as a third-party witness
in connection with any such loss, claim, damage, liability or action;
provided, however, that none of the Issuers will be liable in any such
case to the Initial Purchasers or any controlling person of the Initial
Purchasers to the extent that any such loss, claim, damage or liability
arises out of or is based upon any untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary
Memorandum or the Final Memorandum or any amendment or supplement
thereto, or any Application in reliance upon and in conformity with
written information furnished to the Issuers by or on behalf of the
Initial Purchasers specifically for use therein; and provided, further,
that none of the Issuers will be liable to the Initial Purchasers or
any person controlling the Initial Purchasers with respect to any such
untrue statement or omission made in any Preliminary Memorandum that is
corrected in the Final Memorandum (or any amendment or supplement
thereto) if the person asserting any such loss, claim, damage or
liability purchased Securities from the Initial Purchasers in reliance
upon the Preliminary Memorandum but was not sent or given a copy of the
Final Memorandum (as amended or supplemented) that was made available
by the Issuers to such Initial Purchasers at or prior to the written
confirmation of the sale of the Securities to such person in any case
where such delivery of such Final Memorandum (as so amended or
supplemented) is required by the Act, unless such failure to deliver
such Final Memorandum (as amended or supplemented) was a result of
noncompliance by the Issuers with Section 5(iv) of this Agreement. This
indemnity agreement will be in addition to any liability that the
Issuers may otherwise have to the indemnified parties. None of the
Issuers will, without the prior written consent of the Initial
Purchasers, settle or compromise or consent to the entry of any
judgment in any pending or threatened claim, action, suit or proceeding
in respect of which indemnification by the Initial Purchasers may be
sought hereunder (whether or not the Initial Purchasers or any person
who controls the Initial Purchasers within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act is a party to such claim,
action, suit or proceeding), unless such settlement, compromise or
consent includes an unconditional release of the Initial Purchasers
23
-23-
and each such controlling person from all liability arising out of such
claim, action, suit or proceeding.
(b) The Initial Purchasers will indemnify and hold harmless
the Issuers, their respective directors and each person, if any, who controls
any of the Issuers within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act against any losses, claims, damages or liabilities to which any
of the Issuers or any such director or controlling 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 any untrue statement or alleged untrue statement of any material fact
contained in any Preliminary Memorandum or the Final Memorandum or any amendment
or supplement thereto or any Application, in each case to the extent, but only
to the extent, that such untrue statement or alleged untrue statement was made
in reliance upon and in conformity with written information furnished to any of
the Issuers by or on behalf of the Initial Purchasers specifically for use
therein; and, subject to the limitation set forth immediately preceding this
clause, will reimburse, as incurred, any legal or other expenses reasonably
incurred by any of the Issuers or any such director, officer or controlling
person in connection with investigating or defending against or appearing as a
third-party witness in connection with any such loss, claim, damage, liability
or action in respect thereof. This indemnity agreement will be in addition to
any liability that the Initial Purchasers may otherwise have to the indemnified
parties. The Initial Purchasers will not, without the prior written consent of
the Issuers, settle or compromise or consent to the entry of any judgment in any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification by any of the Issuers may be sought hereunder (whether or not
any of the Issuers or any person who controls the Issuers within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act is a party to such
claim, action, suit or proceeding), unless such settlement, compromise or
consent includes an unconditional release of any such Issuer and each such
controlling person from all liability arising out of such claim, action, suit or
proceeding or otherwise with the consent of the Issuers.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 8, notify the indemnifying party of the commencement thereof;
but the omission so to notify the indemnifying party will not relieve it from
any liability that it may have to any indemnified party
24
-24-
except to the extent that such omission results in the forfeiture by the
indemnifying party of substantial rights and defenses. In case any such action
is brought against any indemnified party, and such indemnified party 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 the named parties in any such action (including any
impleaded parties) include both the indemnified party and the indemnifying party
and the indemnified party shall have reasonably concluded 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 any such indemnifying party,
then the indemnifying parties 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 8 for any legal or other expenses, other
than reasonable and documented out-of-pocket 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, representing the indemnified parties under such
paragraph (a) or paragraph (b), as the case may be, who are parties to such
action or actions); (ii) the indemnifying party has authorized in writing the
employment of counsel for the indemnified party at the expense of the
indemnifying parties; or (iii) the indemnifying party shall have failed to
assume the defense or retain counsel reasonably satisfactory to the indemnified
party. After such notice from the indemnifying parties to such indemnified party
(so long as the indemnified party shall have informed the indemnifying parties
of such action in accordance with this Section 8 on a timely basis prior to the
indemnified party seeking indemnification hereunder), the indemnifying parties
will not be liable under this Section 8 for the costs and
25
-25-
expenses of any settlement of such action effected by such indemnified party
without the consent of the indemnifying party, unless such indemnified party
waived its rights under this Section 8, 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 8 is unavailable or insufficient
to hold harmless an indemnified party in respect of any losses, claims, damages
or liabilities (or actions in respect thereof), each indemnifying party, in
order to provide for just and equitable contribution, shall contribute to the
amount paid or payable by such indemnified party as a result of such losses,
claims, damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect (i) the relative benefits received by
the indemnifying party or parties on the one hand and the indemnified party on
the other from the offering of the Securities or (ii) if the allocation provided
by the foregoing clause (i) is not permitted by applicable law, not only such
relative benefits but also the relative fault of the indemnifying party or
parties on the one hand and the indemnified party on the other in connection
with the statements or omissions or alleged statements or omissions that
resulted in such losses, claims, damages or liabilities (or actions in respect
thereof). The relative benefits received by the Issuers on the one hand and the
Initial Purchasers on the other hand shall be deemed to be in the same
proportion as the total proceeds from the offering of the Securities (before
deducting expenses) received by the Issuers bear 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 Issuers
on the one hand, or the Initial Purchasers on the other hand, the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission, and any other equitable considerations
appropriate in the circumstances. The Issuers 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 (even if the Issuers on the one
hand and the Initial Purchasers on the other hand were treated as one entity for
such purpose) 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), the
Initial Purchasers shall not be obligated to make contributions hereunder that
in the aggregate exceed the
26
-26-
total discounts and commissions received by the Initial Purchasers under this
Agreement, less the aggregate amount of any damages that the Initial Purchasers
have otherwise been required to pay by reason of the untrue or alleged untrue
statements, 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 the Initial Purchasers
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 any of the Issuers and each person, if any, who controls any of the
Issuers 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 Issuers.
9. Offering of Securities; Restrictions on Transfer. The
Initial Purchasers represent and warrant that they are QIBs. The Initial
Purchasers agree with the Issuers that (i) they have not and will not solicit
offers for, or offer or sell, the Securities by any form of general solicitation
or general advertising (as those terms are used in Regulation D under the Act)
or in any manner involving a public offering within the meaning of Section 4(2)
of the Act; and (ii) they have and will solicit offers for the Securities only
from, and will offer the Securities only to, (A) in the case of offers inside
the United States (x) persons whom the Initial Purchasers reasonably believe to
be QIBs or, if any such person is buying for one or more institutional accounts
for which such person is acting as fiduciary or agent, only when such person has
represented to the Initial Purchasers that each such account is a QIB, to whom
notice has been given that such sale or delivery is being made in reliance on
Rule 144A and, in each case, in transactions under Rule 144A or (y) a limited
number of other institutional investors reasonably believed by the Initial
Purchasers to be Accredited Investors that, prior to their purchase of the
Securities, deliver to the Initial Purchasers a letter containing the
representations and agreements set forth in Appendix A to the Final Memorandum
and (B) in the case of offers outside the United States, to persons other than
U.S. persons ("foreign purchasers," which term shall include dealers or other
professional fiduciaries in the United States acting on a discretionary basis
for foreign beneficial owners (other than an estate or trust); provided,
however, that, in the case of this Clause (B), in purchasing such Securities
such persons are deemed to have represented and agreed as provided under the
caption "Notice to Investors" contained in the Final Memorandum.
27
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10. Survival Clause. The respective representations,
warranties, agreements, covenants, indemnities and other statements of the
Issuers, their respective officers and the Initial Purchasers set forth in this
Agreement or made by or on behalf of them, respectively, pursuant to this
Agreement shall remain in full force and effect, regardless of (i) any
investigation made by or on behalf of the Issuers, any of their respective
officers or directors, the Initial Purchasers or any controlling person referred
to in Section 8 hereof and (ii) delivery of and payment for the Securities, and
shall be binding upon and shall inure to the benefit of, any successors,
assigns, heirs, personal representatives of the Issuers, the Initial Purchasers
and indemnified parties referred to in Section 8 hereof. The respective
agreements, covenants, indemnities and other statements set forth in Sections 6
and 8 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 Issuers given in the
event that the Issuers shall have failed, refused or been unable to satisfy all
conditions on its respective part to be performed or satisfied hereunder on or
prior to the Closing Date or, if at or prior to the Closing Date:
(i) any of the Company or the Subsidiaries shall have
sustained any loss or interference with respect to their respective
businesses or properties from fire, flood, hurricane, earthquake,
accident or other calamity, whether or not covered by insurance, or
from any labor dispute or any legal or governmental proceeding, which
loss or interference has had or has a material adverse effect on the
business, condition (financial or other), properties, prospects or
results of operations of the Company and the Subsidiaries, taken as a
whole, or there shall have been any material adverse change, or any
development involving a prospective material adverse change (including
without limitation a change in management or control of the Issuers),
in the business, condition (financial or other), properties, prospects
or results of operations of the Company and the Subsidiaries, taken as
a whole, except as described in or contemplated by the Final Memorandum
(exclusive of any amendment or supplement thereto);
(ii) trading in securities generally on the New York Stock
Exchange, the American Stock Exchange or the Nasdaq National Market
shall have been suspended or minimum or
28
-28-
maximum prices shall have been established on any such
exchange;
(iii) a banking moratorium shall have been declared by
New York or United States authorities;
(iv) 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 or any material change in the financial
markets of the United States that, in the sole judgment of the Initial
Purchasers, makes it impracticable or inadvisable to proceed with the
delivery of the Securities as contemplated by the Final Memorandum, as
amended as of the date hereof; or
(v) any securities of the Company 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
Section 10 hereof.
12. Notices. All communications hereunder shall be in writing
and, if sent to the Initial Purchasers, shall be mailed, delivered or telecopied
and confirmed in writing to CIBC Wood Gundy Securities Corp., ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇, and with
a copy to ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq. If sent to any of the Issuers, shall be mailed,
delivered or telecopied and confirmed in writing, to c/o Outdoor Systems, Inc.,
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Chief
Executive Officer, and with a copy to Powell, Goldstein, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP,
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇, Esq.
13. Successors. This Agreement shall inure to the benefit of
and be binding upon the Initial Purchasers and each of the Issuers 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
29
-29-
such persons and for the benefit of no other person except that (i) the
indemnities of the Issuers contained in Section 8 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 (ii) the indemnities of the Initial Purchasers contained in Section 8 of
this Agreement shall also be for the benefit of the directors of the Issuers and
any person or persons who controls any Issuer within the meaning of Section 15
of the Act or Section 20 of the Exchange Act. No purchaser of Securities from
the Initial Purchasers will be deemed a successor because of such purchase.
14. Joint and Several Obligations. All of the obligations of
the Issuers hereunder shall be joint and several obligations of each of them.
15. Information Supplied by the Initial Purchasers. The
statements set forth in the last paragraph on the front cover page of the Final
Memorandum and in the last two sentences of the third paragraph, the fourth and
fifth sentence of the fifth paragraph, the seventh paragraph, the first sentence
of the eighth paragraph and the ninth paragraph, in each case 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 Issuers for purposes of Section 8 hereof.
16. Entire Agreement. This Agreement constitutes the entire
agreement among the parties hereto and supersedes all prior agreements,
understandings and arrangements, oral or written, among the parties hereto with
respect to the subject matter hereof.
17. 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, WITHOUT
GIVING EFFECT TO ANY PROVISIONS RELATING TO CONFLICTS OF LAW.
18. 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.
30
S-1
If the foregoing correctly sets forth our understanding,
please indicate your acceptance thereof in the space provided below for that
purpose, whereupon this Agreement shall constitute a binding agreement among the
Issuers and the Initial Purchasers.
Very truly yours,
OUTDOOR SYSTEMS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chairman
OUTDOOR SYSTEMS PAINTING, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chairman
OS ADVERTISING OF TEXAS PAINTING,
INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chairman
OS BASELINE, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chairman
DECADE COMMUNICATIONS GROUP, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chairman
BENCH ADVERTISING COMPANY OF
COLORADO, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chairman
31
S-2
NEW YORK SUBWAYS ADVERTISING CO.,
INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chairman
OS BUS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chairman
OUTDOOR SYSTEMS (NEW YORK), INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chairman
The foregoing Agreement is hereby
confirmed and accepted as of the date
first above written.
CIBC WOOD GUNDY SECURITIES CORP.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Managing Director
ALEX. ▇▇▇▇▇ & SONS INCORPORATED
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: ▇▇
▇▇▇▇▇▇▇▇▇, LUFKIN & ▇▇▇▇▇▇▇▇
SECURITIES CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Managing Director
32
Exhibit A
Subsidiary Guarantors
Outdoor Systems Painting, Inc.
OS Advertising of Texas Painting, Inc.
OS Baseline, Inc.
Decade Communications Group, Inc.
Bench Advertising Company of Colorado, Inc.
New York Subways Advertising Co., Inc.
OS Bus, Inc.
Outdoor Systems (New York), Inc.
33
Exhibit B
Subsidiaries
Outdoor Systems Painting, Inc.
OS Advertising of Texas Painting, Inc.
OS Baseline, Inc.
Decade Communications Group, Inc.
Bench Advertising Company of Colorado, Inc.
New York Subways Advertising Co., Inc.
OS Bus, Inc.
Outdoor Systems (New York), Inc.
Mediacom Inc.
C.D. Maintenance Services Limited
Outdoor Advertising Sales Limited
Transtop Manufacturing Limited
E.L. ▇▇▇▇▇ Company (Ontario) Limited
Ad Outdoor Signs Limited
34
Exhibit C
Principal Amount
Initial Purchasers of Notes
CIBC Wood Gundy Securities
Corp.............................................. $450,000,000
Alex. ▇▇▇▇▇ & Sons Incorporated...................... $ 25,000,000
▇▇▇▇▇▇▇▇▇, Lufkin & ▇▇▇▇▇▇▇▇
Securities Corporation............................. $ 25,000,000
------------
Total $500,000,000
============
35
Exhibit D
Form of Opinion of Powell, Goldstein, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
Opinion, dated the Closing Date and addressed to the Initial
Purchasers, of Powell, Goldstein, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, counsel to the Issuers,
to the effect that:
(i) The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the State of
Delaware, with corporate power and authority to own, and hold under lease, its
properties and conduct its business as described in the Final Memorandum. Each
of the Subsidiary Guarantors has been duly organized and is validly existing as
a corporation in good standing under the laws of the jurisdiction of its
incorporation with corporate power and authority to own, and hold under lease,
its properties and conduct its business as described in the Final Memorandum.
(ii) Each of the Company and the Subsidiary Guarantors is
duly qualified to transact business as a foreign corporation and is in good
standing under the laws of each of the jurisdictions in which the conduct of its
business requires such qualification, except to the extent that the failure to
qualify would not, in the aggregate, reasonably be expected to have a material
adverse effect on the business or financial condition of the Company and its
Subsidiaries, taken as a whole (a "Material Adverse Effect").
(iii) The outstanding shares of capital stock of each of the
Subsidiary Guarantors have been duly authorized and validly issued and are fully
paid and non-assessable, except that we express no opinion with respect to the
shares of Decade Communications Group, Inc. and Bench Advertising Company of
Colorado, Inc. To the best of our knowledge (a) the shares of capital stock of
each of the Subsidiary Guarantors are owned by the Company or one of the other
Subsidiary Guarantors free and clear of all liens, encumbrances and security
interests (other than any liens granted by the Company in connection with the
Senior Credit Facility (as defined in the Indenture)), and (b) no options,
warrants or other rights to purchase, agreements or other obligations to issue,
or other rights to convert any obligations into, shares of capital stock of or
ownership interests in any of the Subsidiary Guarantors are outstanding.
(iv) The Notes have been duly and validly authorized by the
Company and the Guarantees have been duly and validly authorized by each of the
Subsidiary Guarantors. When executed by the Company, as to the Notes, and the
Subsidiary Guarantors, as to the Guarantees, and authenticated by the Trustee in
accordance with the provisions of the Indenture, and delivered to
36
-2-
and paid for by the Initial Purchasers in accordance with the terms of the
Purchase Agreement, the Notes and the Guarantees will have been duly executed,
issued and delivered and will constitute valid and legally binding obligations
of the Company, as to the Notes, and the Subsidiary Guarantors, as to the
Guarantees, entitled to the benefits of the Indenture and enforceable against
the Company, as to the Notes, and the Subsidiary Guarantors, as to the
Guarantees, in accordance with their respective terms, except that the
enforcement thereof may be subject to (a) bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium or other similar laws, now or hereafter
in effect, relating to creditors' rights generally and (b) general principles of
equity and the discretion of the court before which any proceeding therefor may
be brought (regardless of whether enforceability is considered in a proceeding
at law or in equity). The foregoing opinion as to enforceability is further
qualified in that certain remedies, waivers, and other provisions of the
Securities may not be enforceable, nevertheless such unenforceability will not
render the Securities invalid as a whole or preclude the judicial enforcement of
the obligations of the Company and the Subsidiary Guarantors to pay the
principal of and interest on the Notes as provided in the Securities.
(v) Each of the Issuers has the requisite corporate
power and corporate authority to execute, deliver and perform its obligations
under the Indenture and the Securities; the Indenture has been duly and validly
authorized by the Issuers and is in sufficient form for due qualification under
the Trust Indenture Act and, when executed and delivered by the Issuers
(assuming the due authorization, execution and delivery by the Trustee), will
constitute a valid and legally binding agreement of the Issuers, enforceable
against the Issuers in accordance with its terms, except that the enforcement
thereof may be subject to (a) bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally and (b) general principles of equity and
the discretion of the court before which any proceeding therefor may be brought
(regardless of whether enforceability is considered in a proceeding at law or in
equity). The foregoing opinion as to enforceability is further qualified in that
certain remedies, waivers, and other provisions of the Indenture may not be
enforceable; nevertheless such unenforceability will not render the Indenture
invalid as a whole or preclude the judicial enforcement of the obligations of
the Issuers to pay the principal of and interest on the Notes as provided in the
Indenture.
(vi) Each of the Issuers has the requisite corporate
power and authority to execute, deliver and perform its
37
-3-
obligations under the Purchase Agreement. The Purchase Agreement has been duly
and validly authorized by the Issuers and, when executed and delivered by the
Issuers, will constitute a valid and legally binding agreement of the Issuers,
enforceable against the Issuers in accordance with its terms except (i) that the
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to or
affecting creditors' rights generally or general principles of equity and the
discretion of the court before which any proceeding therefor may be brought
(regardless of whether such enforcement is considered in a proceeding at law or
in equity) and (ii) as any rights to indemnity or contribution hereunder may be
limited by federal and state securities laws and public policy considerations.
(vii) Each of the Issuers has the requisite corporate power
and authority to execute, deliver and perform its obligations under the
Registration Rights Agreement. The Registration Rights Agreement has been duly
and validly authorized by the Issuers and, when executed and delivered by the
Issuers, will constitute a valid and legally binding agreement of the Issuers,
enforceable against the Issuers in accordance with its terms except (i) that the
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to or
affecting creditors' rights generally or general principles of equity and the
discretion of the court before which any proceeding therefor may be brought
(regardless of whether such enforcement is considered in a proceeding at law or
in equity) and (ii) as any rights to indemnity or contribution hereunder may be
limited by federal and state securities laws and public policy considerations.
(viii) No consent, approval, authorization or order of any
governmental agency or body is required for the performance of any of the
Purchase Agreement, the Registration Rights Agreement, the Securities or the
Indenture or any of the agreements contemplated thereby or delivered in
connection therewith, or the consummation of the transactions contemplated
thereby, except as described in the Final Memorandum and such as may be required
under state securities or "Blue Sky" laws in connection with the purchase and
distribution of the Securities and the federal securities laws in connection
with the transactions contemplated by the Registration Rights Agreement.
(ix) To our knowledge, none of the Company or any of the
Subsidiary Guarantors is (a) in violation of its certificate or articles of
incorporation or bylaws, (b) in violation of any statute, judgment, decree,
order, rule or regulation applicable to any of its properties or assets, which
violation would,
38
-4-
individually or in the aggregate, have a Material Adverse Effect or (c) in
breach of or in default under any of the Purchase Agreement, the Registration
Rights Agreement, the Securities or the Indenture or any other contract,
indenture, mortgage, deed of trust, loan agreement, note, lease, license,
franchise agreement, permit, certificate or agreement or instrument identified
to us as being material to the Company and the Subsidiary Guarantors in a
certificate of the Chairman of the Board of Directors of the Company, a copy of
which is attached hereto, which breach or default would individually or in the
aggregate, have a Material Adverse Effect (collectively, the "Other Material
Agreements").
(x) The execution, delivery and performance by the Issuers
of the Purchase Agreement, the Registration Rights Agreement, the Securities or
the Indenture and the consummation by the Issuers of the transactions
contemplated thereby and the fulfillment of the terms thereof, will not violate,
conflict with or constitute or result in a breach of or a default under (or an
event that with notice or lapse of time, or both, would constitute a breach of
or a default under) any of the terms or provisions of (a) the certificate or
articles of incorporation or bylaws of the Company or the Subsidiary Guarantors,
(b) any of the Other Material Agreements or (c) (assuming compliance with all
applicable state securities and "Blue Sky" laws) any statute, judgment, decree,
order, rule or regulation of any court or governmental agency or body known to
us to be applicable to any of the Company or the Subsidiary Guarantors or any of
their respective properties or assets, which violation, conflict, breach or
default would, individually or in the aggregate, have any Material Adverse
Effect.
(xi) Except as described in the Final Memorandum, we know
of no legal or governmental proceedings pending or threatened to which any of
the Company or the Subsidiary Guarantors is a party or to which the respective
properties or assets of the Company or the Subsidiary Guarantors are subject
which would be required to be described in a prospectus or registration
statement under the Securities Act and which are not described in the Final
Memorandum, or that seek to restrain, enjoin, prevent the consummation of or
otherwise challenge the issuance or sale of the Securities to the Initial
Purchasers or the consummation of the other transactions described in the Final
Memorandum; and we know of no legal or governmental proceedings and no contract,
agreement or other document required to be described in a prospectus or
registration statement under the Securities Act that is not described in the
Final Memorandum.
(xii) The statements set forth under the captions "Business
-- Government Regulation," "Description of Senior Credit Facility," "Description
of the Notes" and "Exchange Offer;
39
-5-
Registration Rights" in the Final Memorandum, insofar as such statements purport
to summarize legal documents are fair summaries of the documents so summarized
and, insofar as such statements are summaries of matters of law or legal
conclusions, are accurate summaries in all material respects and the Indenture
and the Securities conform in all material respects to the description thereof
under "Description of the Notes" in the Final Memorandum.
(xiii) None of the Company or the Subsidiary Guarantors is
required to register as an "investment company" or a company "controlled by" an
"investment company" as such terms are defined in the Investment Company Act of
1940, as amended.
(xiv) The sale, issuance, execution or delivery of the
Securities will not violate Regulation G, T, U or X of the Board of Governors of
the Federal Reserve System.
(xv) The Final Memorandum complies as to form in all
material respects with the requirements of the Securities Act applicable to
Registration Statements on Form S-3, and the documents incorporated by reference
in the Final Memorandum when filed complied in all material respects with the
requirements of the Exchange Act, except that in each case we express no opinion
as to the financial statements, schedules and other financial and statistical
data included therein. The Indenture complies as to form in all material
respects with the requirements of the Trust Indenture Act.
(xvi) Assuming (i) the accuracy of the representations and
warranties of the Initial Purchasers in Section 9 of the Purchase Agreement,
(ii) the due performance by the Initial Purchasers of the covenants and
agreements set forth in Section 9 of the Purchase Agreement, and (iii) the
compliance by the Initial Purchasers with the transfer restrictions described
under the caption "Notice to Investors" in the Final Memorandum, it is not
necessary in connection with the offer, sale and delivery of the Securities to
the Initial Purchasers under the Purchase Agreement or in connection with the
initial resale of the Securities by the Initial Purchasers in accordance with
Section 9 of the Purchase Agreement (i) to register the Securities under the
Securities Act or (ii) to qualify the Indenture under the Trust Indenture Act,
it being understood that no opinion is expressed as to any subsequent resale of
any of the Securities.
In our capacity as counsel to the Issuers, we have
participated in conferences with officers and other representatives of the
Issuers, representatives of the independent public accountants for the Issuers
and representatives of the Initial Purchasers at which the contents
40
-6-
of the Memorandum were discussed and, although we are not passing upon and do
not assume any responsibility for the accuracy, completeness or fairness of the
statements contained in the Memorandum or the documents incorporated by
reference therein (except as indicated in clause (xii) above) and have not made
any independent check or verification thereof, on the basis of the foregoing
(relying as to materiality to a large extent upon the statements of officers and
other representatives of the Issuers) no facts have come to our attention that
have caused us to believe that the Final Memorandum as of its date and as of the
date hereof, or any amendment or supplement thereto as of its date and as of the
date hereof, contained or contains an untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading (it being understood that we express no opinion on the
financial statements or other financial and statistical data or information
included or incorporated by reference in the Final Memorandum).