EXHIBIT 1.1
FRIENDLY ICE CREAM CORPORATION
$175,000,000
__% Senior Notes due 2007
UNDERWRITING AGREEMENT
October __, 1997
SOCIETE GENERALE SECURITIES CORPORATION,
As Representative of the several
Underwriters named in Schedule 1,
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
Friendly Ice Cream Corporation, a Massachusetts corporation (the
"Company"), proposes to issue and sell $175,000,000 principal amount of its __%
Senior Notes due 2007 (the "Securities"). The Securities are to be issued
pursuant to an Indenture dated as of October __, 1997 (the "Indenture") to be
entered into between the Company, the Subsidiary Guarantor (as defined in the
Indenture) and The Bank of New York as trustee (the "Trustee"), the form of
which has been filed as an exhibit to the Registration Statement (as defined
below). This is to confirm the agreement concerning the purchase of the
Securities from the Company by the several Underwriters named in Schedule 1
hereto (the "Underwriters"). Societe Generale Securities Corporation has agreed
to act as representative of the several Underwriters (in such capacity, the
"Representative") in connection with the offering and sale of the Securities.
Concurrently with the issuance of the Securities, the Company is offering to the
public up to 5,750,000 shares of Common Stock (the "Common Shares") (the "Common
Stock Offering") and will enter into a new $175 million senior secured credit
facility (the "New Credit Facility").
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY. The
Company and the Subsidiary Guarantor represent and warrant to and agree with the
several Underwriters that:
(a) Filing of Registration Statement. A registration statement on
Form S-1 (No. 333-34635), including a form of prospectus, relating to the
Securities has been prepared by the Company in all material respects in
conformity with the requirements of the Securities Act of 1933, as amended
(the "Securities Act"), and the rules and regulations (the "Rules and
Regulations") of the Securities and Exchange Commission (the "Commission")
and has been filed by the Company with the Commission. The Company may
have filed one or more amendments
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thereto, including the related preliminary prospectus, each of which has
previously been furnished to you. The Company will next file with the
Commission either (i) prior to effectiveness of such registration
statement, a further amendment to such registration statement (including
the form of final prospectus) or (ii) after effectiveness of such
registration statement, a final prospectus in accordance with Rules 430A
and 424(b)(1) or (4). In the case of clause (ii), the Company has included
in such registration statement, as amended at the Effective Time (as
defined below), all information (other than information permitted to be
omitted from the Registration Statement when it becomes effective pursuant
to Rule 430A ("Rule 430A Information")) required by the Securities Act and
the Rules and Regulations to be included in the final prospectus with
respect to the Securities and the offering thereof. As filed, such
amendment and form of final prospectus, or such final prospectus, shall
contain all Rule 430A Information, together with all other such required
information, with respect to the Securities and the offering thereof and,
except to the extent the Representative shall agree in writing to a
modification, shall be in all substantive respects in the form furnished
to you prior to the execution of this Agreement or, to the extent not
completed at such time, shall contain only such specific additional
information and other changes (beyond that contained in the latest
Preliminary Prospectus) as the Company has advised you, prior to the
execution of this Agreement, will be included or made therein. For
purposes of this Agreement, "Effective Time" means the date and time as of
which such registration statement, or the most recent post-effective
amendment thereto, if any, was or is declared effective by the Commission.
"Preliminary Prospectus" means each prospectus included in such
registration statement, or amendments thereof, before it becomes effective
under the Securities Act, any prospectus filed with the Commission by the
Company pursuant to Rule 424(a) and the prospectus included in the
Registration Statement at the Effective Time that omits Rule 430A
Information. Such registration statement, as amended at the Effective
Time, including all Rule 430A Information, if any, is hereinafter referred
to as the "Registration Statement," and the form of prospectus relating to
the Securities, as first filed with the Commission pursuant to and in
accordance with Rule 424(b) or, if no such filing is required, as included
in the Registration Statement is hereinafter referred to as the
"Prospectus."
(b) Compliance with Registration Requirements. At the Effective
Time, the Registration Statement did or will, and when the Prospectus is
first filed (if required) in accordance with Rule 424(b) and on the
Closing Date, the Prospectus (and any supplements thereto) will, comply in
all material respects with the applicable requirements of the Securities
Act and the Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"), and the respective rules thereunder; at the Effective Time, the
Registration Statement did not or will not include any untrue statement of
a material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein not
misleading; and, at the Effective Time, the Prospectus, if not filed
pursuant to Rule 424(b), did not or will not, and on the date of any
filing pursuant to Rule
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424(b) and on the Closing Date, the Prospectus (together with any
supplement thereto) will not, include any untrue statement of a material
fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading. The preceding sentence does not apply to (i)
that part of the Registration Statement which shall constitute the
Statement of Eligibility and Qualification (Form T-1) of the Trustee under
the Trust Indenture Act or (ii) information contained in or omitted from
the Registration Statement or the Prospectus (or any supplement thereto)
in reliance upon and in conformity with written information furnished to
the Company through the Representative by or on behalf of any Underwriter
specifically for use therein (the "Underwriters' Information"). The
parties acknowledge and agree that the Underwriters' Information consists
solely of the material included in the last paragraph on the cover page of
the Prospectus, in the paragraph on the inside front cover page of the
Prospectus concerning stabilization by the Underwriters and in the second,
third and fifth paragraphs under the caption "Underwriting" in the
Registration Statement, the Preliminary Prospectus and the Prospectus. The
Indenture conforms in all respects to the requirements of the Trust
Indenture Act and the rules and regulations of the Commission thereunder.
(c) Offering Materials Furnished to Underwriters. The Company has
delivered to the Representative one complete manually signed copy of the
Registration Statement and of each consent and certificate of experts
filed as a part thereof, and conformed copies of the Registration
Statement (without exhibits) and preliminary prospectuses and the
Prospectus, as amended or supplemented, in such quantities and at such
places as the Representative has reasonably requested for each of the
Underwriters.
(d) Distribution of Offering Material By the Company. The Company
has not distributed and will not distribute, prior to the Closing Date (as
defined below) and the completion of the Underwriters' distribution of the
Securities, any offering material in connection with the offering and sale
of the Securities other than a preliminary prospectus, the Prospectus or
the Registration Statement.
(e) The Underwriting Agreement. This Agreement has been duly
authorized, executed and delivered by, and is a valid and binding
agreement of, the Company and the Subsidiary Guarantor, enforceable in
accordance with its terms, except as rights to indemnification hereunder
may be limited by applicable law or public policy and except as the
enforcement hereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting
the rights and remedies of creditors or by general equitable principles.
(f) Enforceable Obligations. The Indenture, when duly executed by
the proper officers of the Company and the Subsidiary Guarantor and
delivered by the Company and the Subsidiary Guarantor, assuming due
authorization, execution and delivery thereof by the Trustee, will
constitute a valid and binding
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agreement of the Company and the Subsidiary Guarantor enforceable against
the Company and the Subsidiary Guarantor in accordance with its terms,
subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles (whether
considered in a proceeding in equity or at law) and an implied covenant of
good faith and fair dealing; and the Securities, when duly executed,
authenticated, issued and delivered as provided in the Indenture and upon
payment and delivery in accordance with the Underwriting Agreement, will
be duly and validly issued and outstanding and will constitute valid and
binding obligations of the Company entitled to the benefits of the
Indenture and enforceable in accordance with their terms, subject to the
effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors'
rights generally, by general equitable principles (whether considered in a
proceeding in equity or at law) and an implied covenant of good faith and
fair dealing; and the Indenture and the Securities conform to the
descriptions thereof contained in the Prospectus.
(g) Incorporation and Good Standing of the Company and its
Subsidiaries. Each of the Company and its subsidiaries has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation and has corporate
power and authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus and, in the case of
the Company, to enter into and perform its obligations under this
Agreement, the Indenture and the New Credit Facility. Each of the Company
and each subsidiary is duly qualified as a foreign corporation to transact
business and is in good standing in the Commonwealth of Massachusetts and
each other jurisdiction in which such qualification is required, whether
by reason of the ownership or leasing of property or the conduct of
business, except for such jurisdictions (other than the Commonwealth of
Massachusetts) where the failure to so qualify or to be in good standing
would not, individually or in the aggregate, result in a Material Adverse
Change (as defined below). All of the issued and outstanding capital stock
of each subsidiary has been duly authorized and validly issued, is fully
paid and nonassessable and is owned by the Company, directly or through
subsidiaries, free and clear of any security interest, mortgage, pledge,
lien, encumbrance or claim, except as described or contemplated in the
Prospectus. The Company does not own or control, directly or indirectly,
any corporation, association or other entity other than the subsidiaries
listed in Exhibit 21 to the Registration Statement.
(h) Capitalization and Other Capital Stock Matters. The authorized,
issued and outstanding capital stock of the Company is as set forth in the
Prospectus under the caption "Capitalization" (other than for subsequent
issuances, if any, pursuant to employee benefit plans described in the
Prospectus or upon exercise of outstanding options or warrants described
in the Prospectus). All of the issued and outstanding shares of Common
Stock have been duly authorized and validly
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issued, are fully paid and nonassessable and have been issued in
compliance with federal and state securities laws. None of the outstanding
shares of Common Stock were issued in violation of any preemptive rights,
rights of first refusal or other similar rights to subscribe for or
purchase securities of the Company.
(i) No Applicable Registration or Other Similar Rights. There are no
persons with registration or other similar rights to have any equity or
debt securities registered for sale under the Registration Statement or
included in the offering contemplated by this Agreement, except for such
rights as have been duly waived or for which the period of notice to
require such securities to be registered has expired.
(j) No Material Adverse Change. Except as otherwise disclosed in the
Prospectus, subsequent to the respective dates as of which information is
given in the Prospectus: (i) there has been no material adverse change, or
any development that could reasonably be expected to result in a material
adverse change, in the condition, financial or otherwise, or in the
earnings, stockholders' equity, business, management, operations or
prospects, whether or not arising from transactions in the ordinary course
of business, of the Company and its subsidiaries, considered as one entity
(any such change is called a "Material Adverse Change"); (ii) the Company
and its subsidiaries, considered as one entity, have not incurred any
material liability or obligation, indirect, direct or contingent, not in
the ordinary course of business nor entered into any material transaction
or agreement not in the ordinary course of business; and (iii) except as
disclosed in the Prospectus, there has been no dividend or distribution of
any kind declared, paid or made by the Company or, except for dividends
paid to the Company or other subsidiaries, any of its subsidiaries on any
class of capital stock or repurchase or redemption by the Company or any
of its subsidiaries of any class of capital stock.
(k) Independent Accountants. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, who have expressed
their opinion with respect to the financial statements (which term as used
in this Agreement includes the related notes thereto) and supporting
schedules filed with the Commission as a part of the Registration
Statement and included in the Prospectus, are independent public or
certified public accountants as required by the Securities Act.
(l) Preparation of the Financial Statements. The financial
statements filed with the Commission as a part of the Registration
Statement and included in the Prospectus present fairly the consolidated
financial position of the Company and its subsidiaries as of and at the
dates indicated and the results of their operations and cash flows for the
periods specified. The supporting schedules included in the Registration
Statement present fairly the information required to be stated therein.
Such financial statements and supporting schedules have been prepared in
conformity with generally accepted accounting principles, as applied in
the United States, applied on a consistent basis throughout the periods
involved,
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except as may be expressly stated in the related notes thereto. No other
financial statements or supporting schedules are required to be included
in the Registration Statement. The financial information set forth in the
Prospectus under the captions "Prospectus Summary--Summary Consolidated
Financial Information", "Selected Consolidated Financial Information" and
"Capitalization" fairly present the information set forth therein on a
basis consistent with that of the audited financial statements contained
in the Registration Statement. The pro forma financial information of the
Company and its subsidiaries included under the caption "Prospectus
Summary--Summary Consolidated Financial Information", and elsewhere in the
Prospectus and in the Registration Statement present fairly the
information contained therein, have been prepared in accordance with the
Commission's rules and guidelines with respect to pro forma financial
statements and have been properly presented on the bases described
therein, and the assumptions used in the preparation thereof are
reasonable and the adjustments used therein are appropriate to give effect
to the transactions and circumstances referred to therein. The Company's
ratios of earnings to fixed charges set forth in the Prospectus under the
captions "Prospectus Summary--Summary Consolidated Financial Information"
and in "Selected Consolidated Financial Information" have been calculated
in compliance with Item 503(d) of Regulation S-K under the Securities Act.
(m) Non-Contravention of Existing Instruments; No Further
Authorizations or Approvals Required. Neither the Company nor any of its
subsidiaries is in violation of its charter or by-laws or is in default
(or, with the giving of notice or lapse of time, would be in default)
("Default") under any indenture, mortgage, loan or credit agreement, note,
contract, franchise, lease or other instrument to which the Company or any
of its subsidiaries is a party or by which it or any of them may be bound,
or to which any of the property or assets of the Company or any of its
subsidiaries is subject (each, an "Existing Instrument"), except for such
Defaults as would not, individually or in the aggregate, result in a
Material Adverse Change. The Company's execution, delivery and performance
of this Agreement, the Indenture and the New Credit Facility and
consummation of the transactions contemplated hereby and thereby and by
the Prospectus (i) have been duly authorized by all necessary corporate
action and will not result in any violation of the provisions of the
charter or by-laws of the Company or any subsidiary, (ii) will not
conflict with or constitute a breach of, or Default or a Debt Repayment
Triggering Event (as defined below) under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets
of the Company or any of its subsidiaries pursuant to, or require the
consent of any other party to, any Existing Instrument, except for such
conflicts, breaches, Defaults, liens, charges or encumbrances as would
not, individually or in the aggregate, result in a Material Adverse Change
and (iii) will not result in any violation of any law, administrative
regulation or administrative or court decree applicable to the Company or
any subsidiary, except for such violations as would not, individually or
in the aggregate, result in a Material Adverse Change. No consent,
approval, authorization or other order of, or registration or filing with,
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any court or other governmental or regulatory authority or agency, is
required for the Company's execution, delivery and performance of this
Agreement, the Indenture and the New Credit Facility and consummation of
the transactions contemplated hereby and thereby and by the Prospectus,
except such as have been obtained or made by the Company and are in full
force and effect under the Securities Act, applicable state securities or
blue sky laws and from the National Association of Securities Dealers,
Inc. (the "NASD"). As used herein, a "Debt Repayment Triggering Event"
means any event or condition which gives, or with the giving of notice or
lapse of time would give, the holder of any note, debenture or other
evidence of indebtedness (or any person acting on such holder's behalf)
the right to require the repurchase, redemption or repayment of all or a
portion of such indebtedness by the Company or any of its subsidiaries.
(n) Accuracy of Exhibits. 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 Securities Act or by the Rules and
Regulations and which have not been so described or filed.
(o) No Material Actions or Proceedings. There are no legal or
governmental actions, suits or proceedings pending or, to the Company's
knowledge, threatened (i) against or affecting the Company or any of its
subsidiaries, (ii) which has as the subject thereof any officer or
director of, or property owned or leased by, the Company or any of its
subsidiaries or (iii) relating to environmental or discrimination matters,
where in any such case (A) there is a reasonable possibility that such
action, suit or proceeding might be determined adversely to the Company or
such subsidiary and (B) any such action, suit or proceeding, if so
determined adversely, would reasonably be expected to result in a Material
Adverse Change or adversely affect the consummation of the transactions
contemplated by this Agreement.
(p) Possession of Intellectual Property. Other than as set forth in
the Prospectus, the Company and each of its subsidiaries own or possess
adequate rights to use all material patents, patent applications,
trademarks, service marks, trade names, trademark registrations, service
▇▇▇▇ registrations, copyrights, licenses and know-how (including trade
secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures) necessary for the conduct
of their respective businesses 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.
(q) Possession of Licenses and Permits. The Company and each of its
subsidiaries possess all material licenses, certificates, authorizations
and permits issued by, and have made all declarations and filings with,
the appropriate state, federal or foreign regulatory agencies or bodies
which are necessary or desirable for the ownership of their respective
properties or the conduct of their respective businesses as described in
the Prospectus, except where any failures to possess
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or make the same, singularly or in the aggregate, would not result in a
Material Adverse Change, and the Company has not received notification of
any revocation or modification of any such license, authorization or
permit and has no reason to believe that any such license, certificate,
authorization or permit will not be renewed, except such revocations,
modifications or non-renewals as would not result in a Material Adverse
Change.
(r) Title to Properties. The Company and each of its subsidiaries
has good and marketable title to all the properties and assets reflected
as owned in the financial statements referred to in Section 1(l) above (or
elsewhere in the Prospectus), in each case free and clear of any security
interests, mortgages, liens, encumbrances, equities, claims and other
defects, except as described in the Prospectus and such as do not
materially and adversely affect the value of such property and do not
materially interfere with the use made or proposed to be made of such
property by the Company or such subsidiary. The real property,
improvements, equipment and personal property held under lease by the
Company or any subsidiary are held under valid and enforceable leases,
with such exceptions as are not material and do not materially interfere
with the use made or proposed to be made of such real property,
improvements, equipment or personal property by the Company or such
subsidiary.
(s) Taxes. The Company and its subsidiaries each (i) have filed all
necessary federal, state and foreign income and franchise tax returns,
(ii) have paid all federal, state, local and foreign taxes due and payable
for which it is liable, including, but not limited to, withholding taxes
and amounts payable under the Internal Revenue Code of 1986, as amended
(the "Code"), and has furnished all information returns it is required to
furnish pursuant to the Code, (iii) have established adequate reserves for
all such taxes which are not yet due and payable and (iv) do not have any
tax deficiency or claims outstanding or assessed or, to the Company's
knowledge, proposed against it which could reasonably be expected to
result in a Material Adverse Change.
(t) No Labor Dispute. No labor disturbance by the employees of the
Company or any of its subsidiaries exists or, to the Company's knowledge,
is imminent which might be expected to result in a Material Adverse
Change.
(u) Company Not an "Investment Company". The Company has been
advised of the rules and requirements under the Investment Company Act of
1940, as amended (the "Investment Company Act"). The Company is not, and
after receipt of payment for the Securities in the offering thereof or for
the Common Shares in the Common Stock Offering will not be, an "investment
company" within the meaning of Investment Company Act and will conduct its
business in a manner so that it will not become subject to the Investment
Company Act.
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(v) No Lending Relationships. Attached hereto as Exhibit B is, to
the Company's knowledge, a complete and accurate list of the lenders under
the Old Credit Facility (as defined in the Prospectus) as of the date of
this Agreement, which constitutes all of the Company's lenders who would
have received any of the proceeds from the sale of the Securities
hereunder to repay outstanding debt had such repayment occurred on the
date of this Agreement.
(w) No Stabilization. Neither the Company, nor to the Company's
knowledge, any of its affiliates, has taken or may take, directly or
indirectly, any action designed to cause or result in, or which has
constituted or which might reasonably be expected to constitute, the
stabilization or manipulation of the price of the Securities to facilitate
the sale or resale of the Securities.
(x) Insurance. Each of the Company and its subsidiaries are insured
by recognized, financially sound and reputable institutions with policies
in such amounts and with such deductibles and covering such risks as are
generally deemed adequate and customary for their businesses including,
but not limited to, policies covering real and personal property owned or
leased by the Company and its subsidiaries against theft, damage,
destruction, acts of vandalism and earthquakes. The Company has no reason
to believe that it or any subsidiary will not be able (i) to renew its
existing insurance coverage as and when such policies expire or (ii) to
obtain comparable coverage from similar institutions as may be necessary
or appropriate to conduct its business as now conducted and at a cost that
would not result in a Material Adverse Change. Neither of the Company nor
any subsidiary has been denied any insurance coverage which it has sought
or for which it has applied.
(y) Transactions with Management and Others. No relationship, direct
or indirect, exists between or among the Company on the one hand, and the
directors, officers, stockholders, customers or suppliers of the Company
on the other hand, which is required to be described in the Prospectus and
which is not so described.
(z) No Unlawful Contributions or Other Payments. Neither the Company
nor any of its subsidiaries nor, to the Company's knowledge, any employee
or agent of the Company or any subsidiary, has made any contribution or
other payment to any official of, or candidate for, any federal, state or
foreign office in violation of any law or of the character required to be
disclosed in the Prospectus.
(aa) Accounting Controls. The Company and each of its subsidiaries
maintain a system of internal accounting controls sufficient to provide
reasonable assurance that (i) transactions are executed in accordance with
management's general or specific authorizations; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain
asset accountability; (iii) access to assets is permitted only in
accordance with management's general or specific
10
authorization; and (iv) the recorded accountability for assets is computed
with the existing assets at reasonable intervals and appropriate action is
taken with respect to any differences.
(ab) Compliance with Environmental Laws. Except as would not,
individually or in the aggregate, result in a Material Adverse Change (i)
neither the Company nor any of its subsidiaries is in violation of any
federal, state, local or foreign law or regulation relating to pollution
or protection of human health or the environment (including, without
limitation, ambient air, surface water, groundwater, land surface or
subsurface strata) or wildlife, including without limitation, laws and
regulations relating to emissions, discharges, releases or threatened
releases of chemicals, pollutants, contaminants, wastes, toxic substances,
hazardous substances, petroleum and petroleum products (collectively,
"Materials of Environmental Concern"), or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Materials of Environment Concern (collectively,
"Environmental Laws"), which violation includes, but is not limited to,
noncompliance with any permits or other governmental authorizations
required for the operation of the business of the Company or its
subsidiaries under applicable Environmental Laws, or noncompliance with
the terms and conditions thereof, nor has the Company or any of its
subsidiaries received any written communication, whether from a
governmental authority, citizens group, employee or otherwise, that
alleges that the Company or any of its subsidiaries is in violation of any
Environmental Law; (ii) there is no claim, action or cause of action filed
with a court or governmental authority with respect to which the Company
has received notice, no investigation with respect to which the Company
has received written notice, and no written notice by any person or entity
alleging potential liability for investigatory costs, cleanup costs,
governmental responses costs, natural resources damages, property damages,
personal injuries, attorneys' fees or penalties arising out of, based on
or resulting from the presence, or release into the environment, of any
Material of Environmental Concern at any location owned, leased or
operated by the Company or any of its subsidiaries, now or in the past
(collectively, "Environmental Claims"), pending or, to the best of the
Company's knowledge, threatened against the Company or any of its
subsidiaries or any person or entity whose liability for any Environmental
Claim the Company or any of its subsidiaries has retained or assumed
either contractually or by operation of law; and (iii) to the Company's
knowledge, there are no past or present actions, activities,
circumstances, conditions, events or incidents, including, without
limitation, the release, emission, discharge, presence or disposal of any
Material of Environmental Concern, that reasonably could result in a
violation of any Environmental Law or form the basis of a potential
Environmental Claim against the Company or any of its subsidiaries or
against any person or entity whose liability for any Environmental Claim
the Company or any of its subsidiaries has retained or assumed either
contractually or by operation of law.
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(ac) Employee Benefit Plans. No "prohibited transaction" (as defined
in Section 406 of the Employee Retirement Income Security Act of 1974, as
amended, including the regulations and published interpretations
thereunder ("ERISA"), or Section 4975 of the Code), or "accumulated
funding deficiency" (as defined in Section 302 of ERISA) or any of the
events set forth in Section 4043(b) of ERISA (other than events with
respect to which the 30-day notice requirement under Section 4043 of ERISA
has been waived) has occurred with respect to any employee benefit plan
which could result in a Material Adverse Change; each employee benefit
plan is in compliance in all material respects with applicable law,
including ERISA and the Code; the Company has not incurred and does not
expect to incur liability under Title IV of ERISA with respect to the
termination of, or withdrawal from, any "pension plan"; and each "pension
plan" (as defined in ERISA) for which the Company would have any liability
that is intended to be qualified under Section 401(a) of the Code is so
qualified in all material respects and nothing has occurred, whether by
action or by failure to act, which could cause the loss of such
qualification with respect to such plan which could result in a Material
Adverse Change.
(ad) Minute Books. The minute books of the Company and each of its
subsidiaries have been made available to the Underwriters and counsel for
the Underwriters, and such books (i) contain a complete summary of all
meetings and actions of the directors and stockholders of the Company and
each of its subsidiaries since January 1992 through the date of the latest
meeting and action, and (ii) accurately in all material respects reflect
all transactions referred to in such minutes.
Any certificate signed by an officer of the Company and delivered to
the Representative or to counsel for the Underwriters on the Closing Date
shall be deemed to be a representation and warranty by the Company to each
Underwriter as to the matters set forth therein.
2. PURCHASE BY THE UNDERWRITERS. On the basis of the
representations, warranties and agreements contained herein, and subject to the
terms and conditions set forth herein, the Company agrees to issue and sell to
each of the Underwriters, severally and not jointly, and each of the
Underwriters, severally and not jointly, agrees to purchase from the Company,
the principal amount of Securities set forth opposite the name of such
Underwriter in Schedule 1 hereto at a purchase price equal to _____% of the
principal amount thereof plus accrued interest, if any, from October __, 1997 to
the Closing Date (as hereinafter defined).
The Company shall not be obligated to deliver any of the Securities
except upon payment for all the Securities to be purchased as provided herein.
3. QUALIFIED INDEPENDENT UNDERWRITER. The Company hereby confirms
its engagement of Societe Generale Securities Corporation as, and Societe
Generale Securities Corporation hereby confirms its agreement with the Company
to
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render services as a "qualified independent underwriter" within the meaning of
Section 2(o) of Schedule E to the By-Laws of the National Association of
Securities Dealers, Inc. (the "NASD") with respect to the offering and sale of
the Securities. Societe Generale Securities Corporation, in its capacity as
qualified independent underwriter and not otherwise, is referred to herein as
the "QIU".
4. DELIVERY OF AND PAYMENT FOR THE SECURITIES. Delivery of and
payment for the Securities shall be made at the offices of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇, or at such other place as shall be
agreed upon by the Representative and the Company, at 10:00 A.M., New York City
time, on October __, 1997, or at such other date or time, not later than seven
full business days thereafter, as shall be agreed upon by the Representative and
the Company (such date and time being referred to herein as the "Closing Date").
The Securities to be purchased by each Underwriter hereunder shall
be represented by one or more global securities in book-entry form which will be
deposited by or on behalf of the Company with The Depository Trust Company or
its designated custodian. On the Closing Date, the Company shall deliver or
cause to be delivered the Securities to the Representative for the account of
each Underwriter against payment to or upon the order of the Company of the
purchase price by wire transfer payable in Federal (same day) funds by causing
The Depository Trust Company to credit the Securities to the account of the
Representative at The Depository Trust Company.
Time shall be of the essence, and delivery at the time and place
specified pursuant to this Agreement is a further condition of the obligation of
each Underwriter hereunder. The Company shall make the certificates representing
the Securities available for inspection by the Representative and for delivery
to The Depository Trust Company or its designated custodian in New York, New
York, not later than two full business days prior to the Closing Date.
5. FURTHER AGREEMENTS OF THE COMPANY. The Company agrees with each
of the several Underwriters:
(a) Filing of Prospectus. That, if the Effective Time is prior to
the execution and delivery of this Agreement, to file the Prospectus with
the Commission pursuant to and in accordance with subparagraph (1) (or, if
applicable and if consented to by the Representative, subparagraph (4)) of
Rule 424(b) within the time period prescribed by such rule and will
provide evidence satisfactory to the Representative of such timely filing;
(b) Notice of Amendments, etc. To advise the Representative promptly
of any proposal to amend or supplement the registration statement as filed
or the related prospectus or the Registration Statement or the Prospectus
and not to effect such amendment or supplementation without the consent of
the Representative, which consent shall not be unreasonably withheld; to
advise the Representative promptly of the receipt of any comments from the
Commission
13
and of the effectiveness of the Registration Statement (in each case if
the Effective Time is subsequent to the execution and delivery of this
Agreement) and of any amendment or supplementation of the Registration
Statement or the Prospectus, or of any request by the Commission therefor,
and of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any
proceedings for that purpose; to advise the Representative promptly of any
order preventing or suspending the use of any prospectus relating to the
Securities, of the suspension of the qualification of such Securities for
offering or sale in any jurisdiction and of the initiation or threatening
of any proceeding for any such purpose; and to use reasonable best efforts
to prevent the issuance of any stop order or of any such order preventing
or suspending the use of any prospectus relating to the Securities or
suspending any such qualification and, if any such stop order or order or
suspension is issued, to obtain the lifting thereof at the earliest
possible time;
(c) Delivery of Registration Statement and Prospectus. To furnish
promptly to each of the Representative and counsel for the Underwriters a
signed copy of the Registration Statement as originally filed with the
Commission, and each amendment thereto filed with the Commission,
including all consents and exhibits filed therewith; and to deliver
promptly without charge to the Representative such number of the following
documents as the Representative may from time to time reasonably request:
(i) conformed copies of the Registration Statement as originally filed
with the Commission and each amendment thereto (in each case excluding
exhibits other than this Agreement, the Indenture and the computation of
the ratio of earnings to fixed charges) and (ii) each Preliminary
Prospectus, the Prospectus and any amended or supplemented Prospectus;
provided that in the case of a delivery made pursuant to this clause (ii)
such delivery shall be made not later than 10 A.M. New York City time on
the day following the date of such amendment or supplement;
(d) Continued Compliance with Securities Laws. If the delivery of a
prospectus is required at any time in connection with the sale of the
Securities and if at such time any events shall have occurred as a result
of which the Prospectus as then amended or supplemented would include an
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 when such Prospectus is
delivered, not misleading, or if for any other reason it shall be
necessary at such time to amend or supplement the Prospectus in order to
comply with the Securities Act, to notify the Representative immediately
thereof, and to promptly prepare and file with the Commission an amended
Prospectus or a supplement to the Prospectus which will correct such
statement or omission or effect such compliance;
(e) Filing of Amendments. To file promptly with the Commission any
amendment to the Registration Statement or the Prospectus or any
supplement to the Prospectus that may, in the reasonable judgment of the
Company or the
14
Representative, be required by the Securities Act or requested by the
Commission or advisable in connection with the distribution of the
Securities;
(f) Earning Statement. As soon as practicable to make generally
available to the Company's security holders and to deliver to the
Representative an earning statement of the Company and its subsidiaries
(which need not be audited) complying with Section 11(a) of the Securities
Act and the Rules and Regulations (including, at the option of the
Company, Rule 158);
(g) Delivery of Reports. During a period of five years from the
Effective Time of the Registration Statement, to furnish to the
Representative copies of all materials furnished by the Company to its
shareholders and all public reports and all reports and financial
statements publicly furnished by the Company to the Commission pursuant to
the Exchange Act or any rule or regulation of the Commission thereunder;
(h) Qualification of Securities. Promptly from time to time to take
such action as the Representative may reasonably request to qualify the
Securities for offering and sale under the securities laws of such
jurisdictions as the Representative may reasonably request and to comply
with such laws so as to permit the continuance of sales and dealings
therein in such jurisdictions for as long as may be necessary to complete
the distribution of the Securities; provided that in connection therewith
the Company shall not be required to qualify as a foreign corporation or
to file a general consent to service of process in any jurisdiction;
(i) Use of Proceeds. The Company shall use the net proceeds of its
sale of the Securities as set forth in the "Use of Proceeds" section of
the Prospectus and shall file such reports with the Commission with
respect to the sale of the Securities and the application of the proceeds
therefrom as may be required in accordance with Rule 463 under the
Securities Act ("Rule 463"). The Company shall promptly deliver to the
Representative a signed copy of each report on Form SR filed with the
Commission pursuant to Rule 463;
(j) Stabilization. Not to take, directly or indirectly, any action
designed to cause or result in, or that has constituted or might
reasonably be expected to constitute, the stabilization or manipulation of
the price of any securities of the Company; and
(k) Restriction on Sale of Securities. During the period beginning
from the date hereof and continuing to, and including, the Closing Date or
such earlier time as the Representative may notify the Company, not to
offer for sale, sell, contract to sell or otherwise dispose of, directly
or indirectly, or file a registration statement for, or announce any
offering of, any securities of the Company that are substantially similar
to the Securities.
15
6. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The respective
obligations of the several Underwriters hereunder are subject to the accuracy,
when made and on the Closing Date, of the representations and warranties of the
Company contained herein, to the accuracy of the statements of the Company made
in any certificates pursuant to the provisions hereof, to the performance by the
Company of its obligations hereunder, and to each of the following additional
terms and conditions:
(a) Accountant's Comfort Letter. On the date hereof, the
Representative shall have received from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, independent
public or certified public accountants for the Company, a letter dated the
date hereof addressed to the Underwriters, in form and substance
satisfactory to the Representative, containing statements and information
of the type ordinarily included in accountant's "comfort letters" to
underwriters, delivered according to Statement of Auditing Standards No.
72 (or any successor bulletin), with respect to the audited and unaudited
financial statements and certain financial information contained in the
Registration Statement and the Prospectus (and the Representative shall
have received an additional [___] conformed copies of such accountants'
letter for each of the several Underwriters).
(b) Compliance with Registration Requirements; No Stop Order; No
Objection from NASD. For the period from and after effectiveness of this
Agreement and prior to the Closing Date:
(i) the Company shall have filed the Prospectus with the
Commission (including the information required by Rule 430A under
the Securities Act) in the manner and within the time period
required by Rule 424(b) under the Securities Act; or the Company
shall have filed a post-effective amendment to the Registration
Statement containing the information required by such Rule 430A, and
such post-effective amendment shall have become effective; or, if
the Company elected to rely upon Rule 434 under the Securities Act
and obtained the Representative's consent thereto, the Company shall
have filed a Term Sheet with the Commission in the manner and within
the time period required by such Rule 424(b);
(ii) no stop order suspending the effectiveness of the
Registration Statement, any Rule 462(b) Registration Statement, or
any post-effective amendment to the Registration Statement, shall be
in effect and no proceedings for such purpose shall have been
instituted or threatened by the Commission; and
(iii) the NASD shall have raised no objection to the fairness
and reasonableness of the underwriting terms and arrangements.
(c) No Material Adverse Change. (i) Neither the Company nor any of
its subsidiaries shall have sustained since the date of the latest audited
financial
16
statements included 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
Material Adverse Change or any change in the capital stock or long-term
debt of the Company or any of its subsidiaries, otherwise than as set
forth in the Prospectus, the effect of which, in any such case described
in clause (i) or (ii), is, in the judgment of the Representative, so
material and adverse as to make it impracticable or inadvisable to proceed
with the public offering or the delivery of the Securities on the terms
and in the manner contemplated in the Prospectus exclusive of any
supplement.
(d) No Downgrading. Subsequent to the execution and delivery of this
Agreement (i) no downgrading shall have occurred in the rating accorded
the Securities or any of the Company's or any of its subsidiaries' other
debt securities by any "nationally recognized statistical rating
organization," as that term is defined by the Commission for purposes of
Rule 436(g)(2) of the Rules and Regulations and (ii) no such organization
shall have publicly announced that it has under surveillance or review
(other than an announcement with positive implications of a possible
upgrading), its rating of the Securities or any of the Company's other
debt securities.
(e) No Suspension in Trading; Other Events. Subsequent to the
execution and delivery of this Agreement there shall not have occurred any
of the following: (i) trading or quotation in any of the Company's
securities shall have been suspended or limited, or trading in securities
generally on any of the Nasdaq Stock Market, the New York Stock Exchange,
the American Stock Exchange or in the over-the-counter market shall have
been suspended or limited, or minimum or maximum prices shall have been
generally established on any such stock exchange or market by the
Commission, by any such exchange, by the NASD or by any other regulatory
body or governmental authority having jurisdiction; (ii) a general banking
moratorium shall have been declared by any of federal or state
authorities; (iii) there shall have occurred any outbreak or escalation of
national or international hostilities or any crisis or calamity, or a
declaration of a national emergency or war by the United States; or (iv)
there shall have occurred any change in the United States or international
financial markets, or any substantial change or development involving a
prospective substantial change in United States' or international
political, financial or economic conditions (or the effect of
international conditions on the financial markets in the United States
shall be such), in each case as in the judgment of the Representative is
material and adverse and makes it impracticable to proceed with the public
offering or delivery of the Securities on the terms and in the manner
contemplated in the Prospectus or to enforce contracts for the sale of
securities.
17
(f) Opinions of Counsel for the Company. On the Closing Date, the
Representative shall have received the favorable opinion of (a) ▇▇▇▇▇,
▇▇▇▇▇ & ▇▇▇▇▇, special counsel for the Company, dated as of such Closing
Date, the form of which is attached as Exhibit A-1 and (b)______________ ,
counsel to the Company, dated as of such Closing Date, the form of which
is attached as Exhibit A-2 (and the Representative shall have received an
additional [___] conformed copies of such counsels' legal opinions for
each of the several Underwriters).
(g) Opinion of Counsel for Underwriters. On the Closing Date, the
Representative shall have received from ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇,
counsel for the Underwriters, such opinion or opinions, dated as of such
Closing Date, with respect to such matters as the Representative may
reasonably require, and the Company shall have furnished to such counsel
such documents as they reasonably request for enabling them to pass upon
such matters.
(h) Officers' Certificate. On the Closing Date, the Company shall
have furnished to the Representative a certificate, dated as of such
Closing Date, of its Chairman of the Board, its President or a Vice
President and its chief financial officer stating that (i) such officers
have carefully examined the Registration Statement and the Prospectus,
(ii) in their opinion, as of the Effective Time, the Registration
Statement and the Prospectus did not include any untrue statement of a
material fact and did not omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading,
and since the Effective Time, no event has occurred which should have been
set forth in a supplement or amendment to the Registration Statement or
the Prospectus and (iii) to their knowledge after reasonable
investigation, as of the Closing Date, the representations and warranties
of the Company in this Agreement are true and correct, the Company has
complied with all agreements and satisfied all conditions on its part to
be performed or satisfied hereunder at or prior to such Closing Date, no
stop order suspending the effectiveness of the Registration Statement has
been issued and no proceedings for that purpose have been instituted or,
to their knowledge, are contemplated by the Commission, and subsequent to
the date of the most recent financial statements in the Prospectus, there
has been no Material Adverse Change, except as set forth in the
Prospectus.
(i) Bring-down Comfort Letter. On the Closing Date the
Representative shall have received from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, LLP, independent
public or certified public accountants for the Company, a letter dated
such date, in form and substance reasonably satisfactory to the
Representative, to the effect that they reaffirm the statements made in
the letter furnished by them pursuant to subsection (a) of this Section 6,
except that the specified date referred to therein for the carrying out of
procedures shall be no more than three business days prior to the Closing
Date (and the Representative shall have received an additional [___]
conformed copies of such accountants' letter for each of the several
Underwriters).
18
(i) Recapitalization. The Recapitalization, as defined and described
in the Prospectus, shall have been, or be concurrently, completed as of
the Closing Date, including, without limitation, the Common Stock Offering
shall have been, or be concurrently, consummated and the Company shall
have entered, or be concurrently entering, into the New Credit Facility
and the proceeds therefrom shall have been applied, or are being applied
concurrently with the offering of the Securities, as described in the
Prospectus.
(j) Additional Documents. On or before the Closing Date, the
Representative and counsel for the Underwriters shall have received such
information, documents and opinions as they may reasonably require for the
purposes of enabling them to pass upon the issuance and sale of the
Securities as contemplated herein, or in order to evidence the accuracy of
any of the representations and warranties, or the satisfaction of any of
the conditions or agreements, herein contained.
(k) Legal Matters. All corporate proceedings and other legal matters
incident to the authorization, form and validity of this Agreement, the
Securities, the Indenture, the New Credit Facility, the Registration
Statement and the Prospectus, and all other legal matters relating to this
Agreement and the transactions contemplated hereby shall be reasonably
satisfactory in all material respects to counsel for the Underwriters, and
the Company shall have furnished to such counsel all documents and
information that they may reasonably request to enable them to pass upon
such matters.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Underwriters.
7. TERMINATION. This Agreement shall become effective upon the later
of the date upon which (i) the Underwriter and the Company shall have received
notification of the effectiveness of the Registration Statement or (ii) this
Agreement shall have been executed by the parties hereto. The obligations of the
Underwriters hereunder may be terminated by the Representative, in its absolute
discretion, by notice given to and received by the Company prior to delivery of
and payment for the Securities if, prior to that time, any of the events
described in Sections 6(c), 6(d) or 6(e) shall have occurred.
8. DEFAULTING UNDERWRITERS. (a) Obligations of Non-Defaulting
Underwriters. If, on the Closing Date, any Underwriter or Underwriters default
in the performance of its or their obligations under this Agreement, the
Representative may make arrangements for the purchase of such Securities by
other persons satisfactory to the Company and the Representative, including any
of the Underwriters, but if no such arrangements are made by the Closing Date,
then each remaining non-defaulting Underwriter shall be severally obligated to
purchase the Securities which the defaulting
19
Underwriter or Underwriters agreed but failed to purchase on the Closing Date in
the respective proportions which the principal amount of Securities set forth
opposite the name of each remaining non-defaulting Underwriter in Schedule 1
hereto bears to the aggregate principal amount of Securities set forth opposite
the names of all the remaining non-defaulting Underwriters in Schedule 1 hereto;
provided, however, that the remaining non-defaulting Underwriters shall not be
obligated to purchase any of the Securities on the Closing Date if the aggregate
principal amount of Securities which the defaulting Underwriter or Underwriters
agreed but failed to purchase on such date exceeds one-eleventh of the aggregate
principal amount of the Securities to be purchased on the Closing Date, and any
remaining non-defaulting Underwriter shall not be obligated to purchase in total
more than 110% of the principal amount of the Securities which it agreed to
purchase on the Closing Date pursuant to the terms of Section 2. If the
foregoing maximums are exceeded and the remaining Underwriters or other
underwriters satisfactory to the Representative and the Company do not elect to
purchase the Securities which the defaulting Underwriter or Underwriters agreed
but failed to purchase, this Agreement shall terminate without liability on the
part of any non-defaulting Underwriter or the Company, except that the Company
will continue to be liable for the payment of expenses to the extent set forth
in Section 13 except that the provisions of Sections 10 and 11 shall not
terminate and shall remain in effect. As used in this Agreement, the term
"Underwriter" includes, for all purposes of this Agreement unless the context
otherwise requires, any party not listed in Schedule 1 hereto who, pursuant to
this Section 8, purchases Securities which a defaulting Underwriter agreed but
failed to purchase.
(b) Liability of Defaulting Underwriter; Closing Date. Nothing
contained herein shall relieve a defaulting Underwriter of any liability it may
have for damages caused by its default. If other underwriters are obligated or
agree to purchase the Securities of a defaulting Underwriter, either the
Representative or the Company may postpone the Closing Date for up to seven full
business days in order to effect any changes that in the opinion of counsel for
the Company or counsel for the Underwriters may be necessary in the Registration
Statement, the Prospectus or in any other document or arrangement, and the
Company agrees to file promptly any amendment or supplement to the Registration
Statement or the Prospectus that effects any such changes.
9. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If (a) notice shall have
been given pursuant to Section 7 preventing this Agreement from becoming
effective because of the occurrence of an event described in Section 6(c), 6(d)
or 6(e)(i) (as to the Company's securities only), (b) the Company shall fail to
tender the Securities for delivery to the Underwriters for any reason permitted
under this Agreement or (c) the Underwriters shall decline to purchase the
Securities for any reason permitted under this Agreement, the Company shall
reimburse the Underwriters for the fees and expenses of their counsel and for
such other out-of-pocket expenses as shall have been reasonably incurred by them
in connection with this Agreement and the proposed purchase of the Securities,
and upon demand the Company shall pay the full amount thereof to the
Representative. If this Agreement is terminated pursuant to Section 8 by
20
reason of the default of one or more Underwriters, the Company shall not be
obligated to reimburse any defaulting Underwriter on account of those expenses.
10. INDEMNIFICATION OF UNDERWRITERS AND THE COMPANY. (a)
Indemnification of Underwriters. The Company and its subsidiaries shall
indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of the Securities Act (collectively
referred to for the purposes of this Section 10 as the Underwriter) against any
loss, claim, damage or liability, joint or several, or any action in respect
thereof, to which that Underwriter may become subject, under the Securities Act
or otherwise, insofar as such loss, claim, damage, liability or action arises
out of or is based upon (i) any untrue statement or alleged untrue statement of
a material fact contained in any Preliminary Prospectus, the Registration
Statement or the Prospectus or in any amendment or supplement thereto or (ii)
the omission or alleged omission to state in any Preliminary Prospectus, the
Registration Statement or the Prospectus or in any amendment or supplement
thereto a material fact required to be stated therein or necessary to make the
statements therein not misleading, and shall reimburse each Underwriter for any
legal or other expenses reasonably incurred by that Underwriter in connection
with investigating or preparing to defend or defending against or appearing as a
third party witness in connection with any such loss, claim, damage, liability
or action as such expenses are incurred; provided, however, that the foregoing
indemnification agreement with respect to any Preliminary Prospectus shall not
inure to the benefit of any Underwriter from whom the person asserting any such
loss, claim, damage or liability purchased Securities, if (i) a copy of the
Prospectus (as then amended or supplemented) was required by law to be delivered
to such person at or prior to the written confirmation of the sale of Securities
to such person, (ii) a copy of the Prospectus (as then amended or supplemented)
was not sent or given to such person by or on behalf of such Underwriter and
(iii) the Prospectus (as so amended or supplemented) would have cured the defect
giving rise to such loss, claim, damage or liability; and further provided,
however, that the Company and its subsidiaries shall not be liable in any such
case to the extent that any such loss, claim, damage, liability or action arises
out of or is based upon (i) that part of the Registration Statement which shall
constitute the Statement of Eligibility and Qualification (Form T-1) of the
Trustee under the Trust Indenture Act or (ii) an untrue statement or alleged
untrue statement in or omission or alleged omission from any Preliminary
Prospectus, the Registration Statement or the Prospectus or any such amendment
or supplement in reliance upon and in conformity with written information
furnished to the Company through the Representative by or on behalf of any
Underwriter specifically for use therein, which information the parties hereto
agree is limited to the Underwriters' Information.
(b) Indemnification of Company, Directors and Officers. Each
Underwriter, severally and not jointly, shall indemnify and hold harmless the
Company, each of its directors, each officer of the Company who signed the
Registration Statement and each person, if any, who controls the Company within
the meaning of the Securities Act (collectively referred to for the purposes of
this Section 10 as the Company), against any loss, claim, damage or liability,
joint or several, or any action in respect thereof, to which the Company may
become subject, under the Securities Act or otherwise, insofar as such
21
loss, claim, damage, liability or action arises out of or is based upon (i) any
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement or the Prospectus or in any
amendment or supplement thereto or (ii) the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, but in each case only to the extent that
the untrue statement or alleged untrue statement or omission or alleged omission
was made in reliance upon and in conformity with written information furnished
to the Company through the Representative by or on behalf of that Underwriter
specifically for use therein, and shall reimburse the Company for any legal or
other expenses reasonably incurred by the Company in connection with
investigating or preparing to defend or defending against or appearing as third
party witness in connection with any such loss, claim, damage, liability or
action as such expenses are incurred; provided that the parties hereto hereby
agree that such written information provided by the Representative consists
solely of the Underwriters' Information.
(c) Actions; Notification. Promptly after receipt by an indemnified
party under this Section 10 of notice of any claim or the commencement of any
action, the indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under this Section 10, notify the indemnifying
party in writing of the claim or the commencement of that action; provided,
however, that the failure to notify the indemnifying party shall not relieve it
from any liability which it may have under this Section 10 except to the extent
it has been materially prejudiced by such failure; and, provided, further, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have to an indemnified party otherwise than under this
Section 10. If any such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to assume
the defense thereof with counsel reasonably satisfactory to the indemnified
party. After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, the indemnifying party
shall not be liable to the indemnified party under this Section 10 for any legal
or other expenses subsequently incurred by the indemnified party in connection
with the defense thereof other than reasonable costs of investigation; provided,
however, that any indemnified party shall have the right to employ separate
counsel in any such action and to participate in the defense thereof but the
fees and expenses of such counsel shall be at the expense of such indemnified
party unless (i) the employment thereof has been specifically authorized by the
indemnifying party in writing, (ii) such 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
indemnifying party and in the reasonable judgment of such counsel it is
advisable for such indemnified party to employ separate counsel or (iii) the
indemnifying party has failed to assume the defense of such action and employ
counsel reasonably satisfactory to the indemnified party, in which case, if such
indemnified party notifies the indemnifying party in writing that it elects to
employ separate counsel at the expense of the indemnifying party, the
indemnifying party shall not have the right to
22
assume the defense of such action on behalf of such indemnified party, it being
understood, however, that the indemnifying party 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 reasonable fees and expenses of more than one
separate firm of attorneys at any time for all such indemnified parties, which
firm shall be designated in writing by the Representative, if the indemnified
parties under this Section 10 consist of any Underwriter or any of their
respective officers, employees or controlling persons, or by the Company, if the
indemnified parties under this Section 10 consist of the Company or any of the
Company's directors, officers, employees or controlling persons. Each
indemnified party, as a condition of the indemnity agreements contained in
Sections 10(a) and 10(b), shall use all reasonable efforts to cooperate with the
indemnifying party in the defense of any such action or claim. Subject to the
provisions of Section 10(d) below, no indemnifying party shall be liable for any
settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its written
consent or if there be a final judgment for the plaintiff in any such action,
the indemnifying party agrees to indemnify and hold harmless any indemnified
party from and against any loss or liability by reason of such settlement or
judgment.
(d) Settlement without Consent if Failure to Reimburse. If at any
time an indemnified party shall have requested that an indemnifying party
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by this Section 10 effected without its written consent if
(i) such settlement is entered into more than 30 days after receipt by such
indemnifying party of the request for reimbursement, (ii) such indemnifying
party shall have received notice of the terms of such settlement at least 15
days prior to such settlement being entered into and (iii) such indemnifying
party shall not have reimbursed such indemnified party in accordance with such
request prior to the date of such settlement. Notwithstanding the immediately
preceding sentence, if at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel, an indemnifying party shall not be liable for any settlement effected
without its consent if such indemnifying party (i) reimburses such indemnified
party in accordance with such request to the extent it in its reasonable
judgment considers such request to be reasonable and (ii) provides written
notice to the indemnified party substantiating the unpaid balance as
unreasonable, in each case prior to the date of such settlement.
(e) Contribution. If the indemnification provided for in this
Section 10 is unavailable or insufficient to hold harmless an indemnified party
under Section 10(a) or (b), then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or payable by
such indemnified party as a result of such loss, claim, damage or liability, or
action in respect thereof, (i) in such proportion as shall be appropriate to
reflect the relative benefits received by the Company on the one hand and the
Underwriters on the other from the offering of the Securities or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such
23
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company on the one
hand and the Underwriters on the other with respect to the statements or
omissions which resulted in such loss, claim, damage or liability, or action in
respect thereof, as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and the Underwriters
on the other with respect to such offering shall be deemed to be in the same
proportion as the total net proceeds from the offering of the Securities
purchased under this Agreement (before deducting expenses) received by the
Company bear to the total underwriting discounts and commissions received by the
Underwriters with respect to the Securities purchased under this Agreement, in
each case as set forth in the table on the cover page of the Prospectus. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company on the one hand or the Underwriters on the other, the intent of the
parties and their relative knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission; provided that the parties
hereto agree that the written information furnished to the Company by the
Underwriters for use in the Preliminary Prospectus, the Registration Statement
or the Prospectus consists solely of the Underwriters' Information. The Company
and the Underwriters agree that it would not be just and equitable if
contributions pursuant to this Section 10(e) were to be determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take into account
the equitable considerations referred to herein. The amount paid or payable by
an indemnified party as a result of the loss, claim, damage or liability, or
action in respect thereof, referred to above in this Section 10(e) shall be
deemed to include, for purposes of this Section 10(e), 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 10(e), no Underwriter shall be required to contribute
any amount in excess of the amount by which the total price at which the
Securities underwritten by it and distributed to the public were offered to the
public less the amount of any damages which such Underwriter has otherwise paid
or become liable to pay by reason of any 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 Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
The Underwriters' obligations to contribute as provided in this
Section 10(e) are several in proportion to their respective underwriting
obligations and not joint.
The obligations of the Company and the Underwriters in this Section
10 are in addition to any other liability which the Company or the Underwriters,
as the case may be, may otherwise have.
24
11. INDEMNIFICATION OF QUALIFIED INDEPENDENT UNDERWRITER. (a)
Indemnification. The Company and its subsidiaries shall indemnify and hold
harmless Societe Generale Securities Corporation in its capacity as QIU, and
each person, if any, who controls the QIU within the meaning of the Securities
Act (collectively referred to for the purposes of this Section 11 as the QIU)
against any loss, claim, damage or liability, joint or several, or any action in
respect thereof, to which the QIU may become subject, under the Securities Act
or otherwise, insofar as such loss, claim, damage, liability or action arises
out of or is based upon (i) any untrue statement or alleged untrue statement of
a material fact contained in any Preliminary Prospectus, the Registration
Statement or the Prospectus or in any amendment or supplement thereto or (ii)
the omission or alleged omission to state in any Preliminary Prospectus, the
Registration Statement or the Prospectus or in any amendment or supplement
thereto a material fact required to be stated therein or necessary to make the
statements therein not misleading, and shall reimburse the QIU for any legal or
other expenses reasonably incurred by the QIU in connection with investigating
or preparing to defend or defending against or appearing as a third party
witness in connection with any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that Societe Generale Securities
Corporation, in its capacity as QIU, shall not be entitled to indemnification
pursuant to this Section 11 in respect of any losses, claims, damages or
liabilities, joint or several, or any (action in respect thereof) to the extent
and only to the extent that it would be denied indemnification in its capacity
as an Underwriter pursuant to Section 10 hereof in respect of such losses,
claims, damages or liabilities, joint or several, or any action in respect
thereof.
(b) Actions; Notification. Promptly after receipt by the QIU under
this Section 11 of notice of any claim or the commencement of any action, the
QIU shall, if a claim in respect thereof is to be made against the Company under
this Section 11, notify the Company in writing of the claim or the commencement
of that action; provided, however, that the failure to notify the Company shall
not relieve it from any liability which it may have under this Section 11 except
to the extent it has been materially prejudiced by such failure; and, provided,
further, that the failure to notify the Company shall not relieve it from any
liability which it may have to the QIU otherwise than under this Section 11. If
any such claim or action shall be brought against the QIU, and it shall notify
the Company thereof, the Company shall be entitled to participate therein and,
to the extent that it wishes, assume the defense thereof with counsel reasonably
satisfactory to the QIU. After notice from the Company to the QIU of its
election to assume the defense of such claim or action, the Company shall not be
liable to the QIU under this Section 11 for any legal or other expenses
subsequently incurred by the QIU in connection with the defense thereof other
than reasonable costs of investigation; provided, however, that the QIU shall
have the right to employ separate counsel in any such action and to participate
in the defense thereof but the fees and expenses of such counsel shall be at the
expense of the QIU unless (i) the employment thereof has been specifically
authorized by the Company in writing, (ii) the QIU 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 Company and in the
reasonable judgment of such counsel it is advisable for the QIU to employ
25
separate counsel or (ii) the Company has failed to assume the defense of such
action and employ counsel reasonably satisfactory to the QIU, in which case, if
the QIU notifies the Company in writing that it elects to employ separate
counsel at the expense of the Company, the Company shall not have the right to
assume the defense of such action on behalf of the QIU, it being understood,
however, that the Company 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
reasonable fees and expenses of more than one separate firm of attorneys at any
time for the QIU, which firm shall be designated in writing by the QIU. The QIU,
as a condition of the indemnity agreements contained in Section 11(a), shall use
all reasonable efforts to cooperate with the Company in the defense of any such
action or claim. Subject to the provisions of Section 11(c) below, the Company
shall not be liable for any settlement of any such action effected by the QIU
without its written consent (which consent shall not be unreasonably withheld),
but if settled with its written consent or if there be a final judgment for the
plaintiff in any such action, the Company agrees to indemnify and hold harmless
the QIU from and against any loss or liability by reason of such settlement or
judgment.
(c) Settlement without Consent if Failure to Reimburse. If at any
time the QIU shall have requested that the Company reimburse the QIU for fees
and expenses of counsel, the Company agrees that it shall be liable for any
settlement of the nature contemplated by this Section 11 effected without its
written consent if (i) such settlement is entered into more than 30 days after
receipt by the Company of the request for reimbursement, (ii) the Company shall
have received notice of the terms of such settlement at least 15 days prior to
such settlement being entered into and (iii) the Company shall not have
reimbursed the QIU in accordance with such request prior to the date of such
settlement. Notwithstanding the immediately preceding sentence, if at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, an indemnifying party shall
not be liable for any settlement effected without its consent if such
indemnifying party (i) reimburses such indemnified party in accordance with such
request to the extent it in its reasonable judgment considers such request to be
reasonable and (ii) provides written notice to the indemnified party
substantiating the unpaid balance as unreasonable, in each case prior to the
date of such settlement.
(d) Contribution. If the indemnification provided for in this
Section 11 is unavailable or insufficient to hold harmless the QIU under Section
11(a), then the Company shall, in lieu of indemnifying the QIU, contribute to
the amount paid or payable by the QIU as a result of such loss, claim, damage or
liability, or action in respect thereof, (i) in such proportion as shall be
appropriate to reflect the relative benefits received by the Company on the one
hand and the QIU on the other 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 Company on
the one hand and the QIU on the other with respect to the statements or
omissions which resulted in such loss, claim, damage or liability, or action in
respect thereof, as
26
well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the QIU on the other with respect to
such offering shall be deemed to be in the same proportion as the total net
proceeds from the offering of the Securities purchased under this Agreement
(before deducting expenses) received by the Company, as set forth on the cover
page of the Prospectus, bear to the fee payable to the QIU pursuant to Section 3
hereof. The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company on the one hand or the QIU on the other, the intent of
the parties and their relative knowledge, access to information and opportunity
to correct or prevent such untrue statement or omission. The Company and the QIU
agree that it would not be just and equitable if contributions pursuant to this
Section 11(d) were to be determined by pro rata allocation or by any other
method of allocation which does not take into account the equitable
considerations referred to in this Section 11(d). The amount paid or payable by
the QIU as a result of the loss, claim, damage or liability, or action in
respect thereof, referred to above in this Section 11(d) shall be deemed to
include, for purposes of this Section 11(d), any legal or other expenses
reasonably incurred by the QIU in connection with investigating or defending any
such action or claim. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
The obligations of the Company under in this Section 11 are in
addition to any other liability which the Company may otherwise have.
12. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement shall
inure to the benefit of and be binding upon the Underwriters, the QIU, the
Company, and their respective successors. Nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any person, firm or
corporation, other than the Underwriters and the Company and their respective
successors and the controlling persons and officers and directors referred to in
Sections 10 and 11 and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision contained herein.
13. EXPENSES. The Company agrees with the Underwriters to pay (a)
the costs incident to the authorization, issuance, sale, preparation and
delivery of the Securities and any taxes payable in that connection; (b) the
costs incident to the preparation, printing and filing under the Securities Act
of the Registration Statement and any amendments and exhibits thereto (including
the filing fees of the Commission); (c) the costs of distributing the
Registration Statement as originally filed and each amendment thereto and any
post-effective amendments thereof (including, in each case, exhibits), any
Preliminary Prospectus, the Prospectus and any amendment or supplement to the
Prospectus, all as provided in this Agreement; (d) the costs of printing,
reproducing and distributing this Agreement and any other underwriting and
selling group documents by mail, telex or other means of communications; (e) the
filing fees incident to securing any required review by the National Association
of Securities
27
Dealers, Inc. of the terms of sale of the Securities; (f) any applicable listing
or other fees; (g) the fees and expenses of qualifying the Securities under the
securities laws of the several jurisdictions as provided in Section 5(h) and of
preparing, printing and distributing Blue Sky Memoranda and Legal Investment
Surveys (including related fees and expenses of counsel to the Underwriters);
(h) any fees charged by securities rating services for rating the Securities;
(i) all fees and expenses of the Trustee and any agent thereof; and (j) all
other costs and expenses incident to the performance of the obligations of the
Company under this Agreement (including, without limitation, the fees and
expenses of counsel to the Company and the fees and expenses of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
LLP); provided that, except as otherwise provided in this Section 13 and in
Section 9, the Underwriters shall pay their own costs and expenses, including
the fees and expenses of their counsel, any transfer taxes on the Securities
which they may sell and the expenses of advertising any offering of the
Securities made by the Underwriters.
14. SURVIVAL. The respective indemnities, rights of contribution,
representations, warranties and agreements of the Company and the Underwriters
contained in this Agreement or made by or on behalf on them, respectively,
pursuant to this Agreement, shall survive the delivery of and payment for the
Securities and shall remain in full force and effect, regardless of any
termination or cancellation of this Agreement or any investigation made by or on
behalf of any of them or any person controlling any of them.
15. NOTICES, ETC. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by mail,
telex or facsimile transmission to Societe Generale Securities
Corporation, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇ ▇▇▇▇▇, Telephone: (▇▇▇) ▇▇▇-▇▇▇▇, Telecopy: (212)
278-5460;
(b) if to the QIU, shall be delivered or sent by mail, telex or
facsimile transmission to Societe Generale Securities Corporation,
Attention: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Telephone: (▇▇▇) ▇▇▇-▇▇▇▇, Telecopy: (212)
278-7432;
(c) if to the Company, shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Company set forth in the
Registration Statement, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Telephone: (413)
▇▇▇-▇▇▇▇, Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇;
provided, however, that any notice to an Underwriter pursuant to Section 10(c)
shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its acceptance telex to the
Representative, which address will be supplied to any other party hereto by the
Representative upon request. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof. The Company shall
be entitled to act and rely upon any request, consent, notice or agreement given
or made on behalf of the Underwriters by the Representative.
28
16. DEFINITIONS OF CERTAIN TERMS. For purposes of this Agreement,
(a) "business day" means any day on which the New York Stock Exchange, Inc. is
open for trading and (b) "subsidiary" has the meaning set forth in Rule 405 of
the Rules and Regulations.
17. GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York.
18. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same instrument.
19. HEADINGS. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
29
If the foregoing is in accordance with your understanding of the
agreement between the Company and the several Underwriters, kindly indicate your
acceptance in the space provided for that purpose below.
Very truly yours,
FRIENDLY ICE CREAM CORPORATION
By
--------------------------------
Name:
Title:
Accepted:
SOCIETE GENERALE SECURITIES CORPORATION
By
--------------------------------
Authorized Signatory
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
SECURITIES CORPORATION
By
--------------------------------
Authorized Signatory
NATIONSBANC ▇▇▇▇▇▇▇▇▇▇ SECURITIES, INC.
By
--------------------------------
Authorized Signatory
SCHEDULE 1
Principal
Amount
Underwriters of Securities
------------ -------------
Societe Generale Securities Corporation.................. $
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Securities Corporation .....
NationsBanc ▇▇▇▇▇▇▇▇▇▇ Securities, Inc. .................
------------
Total..................................................... $175,000,000
============
EXHIBIT A-1
(a) Opinion of Counsel for Company. ▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇ shall have
furnished to the Representative such counsel's written opinion, as counsel
to the Company, addressed to the Underwriters and dated the Closing Date,
in form and substance reasonably satisfactory to the Representative, to
the effect that:
(i) Assuming that the Indenture has been duly authorized,
executed and delivered by the Company and the Subsidiary Guarantor
and duly qualified under the Trust Indenture Act of 1939, as amended
(the "Trust Indenture Act"), and, assuming due authorization,
execution and delivery thereof by the Trustee, the Indenture
constitutes a valid and legally binding obligation of the Company
and the Subsidiary Guarantor enforceable against the Company and the
Subsidiary Guarantor in accordance with its terms, subject to the
effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, general equitable principles
(whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing; the Indenture
conforms in all material respects to the requirements of the Trust
Indenture Act and the applicable rules and regulations thereunder;
and assuming that the Securities have been duly authorized, executed
and issued by the Company and, assuming due authentication thereof
by the Trustee and upon payment and delivery in accordance with the
Underwriting Agreement, the Securities will constitute valid and
legally binding obligations of the Company enforceable against the
Company in accordance with their terms, subject to the effects of
bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles (whether
considered in a proceeding in equity or at law) and an implied
covenant of good faith and fair dealing and entitled to the benefits
of the Indenture.
(ii) The statements made in the Prospectus under the caption
"Description of Senior Notes," insofar as they purport to constitute
summaries of certain terms of documents referred to therein,
constitute accurate summaries of the terms of such documents in all
material respects.
(iii) Assuming that the Underwriting Agreement has been duly
authorized, executed and delivered by the Company and the Subsidiary
Guarantor, it is a valid and binding agreement of, the Company and
the Subsidiary Guarantor, enforceable in accordance with its terms,
except as rights to indemnification thereunder may be limited by
applicable law or public policy and except as the enforcement
thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium, or other similar laws
2
relating to or affecting creditors' rights generally or by general
equitable principles.
(iv) The execution and delivery of the Underwriting Agreement
by the Company and the Subsidiary Guarantor and the performance by
each of the Company and the Subsidiary Guarantor of its obligations
thereunder (other than performance by each of the Company and the
Subsidiary Guarantor of its obligations under the indemnification
section of the Underwriting Agreement, as to which no opinion need
be rendered) (i) will not result in any violation of the provisions
of the charter or by-laws of the Company or any subsidiary; (ii)
will not constitute a breach of, or Default or a Debt Repayment
Triggering Event under, or result in the creation or imposition of
any lien, charge or encumbrance upon any property or assets of the
Company or any of its subsidiaries pursuant to, any Existing
Instrument identified on an annex to such opinion which the Company
has represented lists all material Existing Instruments to which the
Company or any of such subsidiaries is bound or to which any of the
property or assets of the Company or any of such subsidiaries is
subject, except for such breaches, Defaults, liens, charges or
encumbrances as would not, individually or in the aggregate, result
in a Material Adverse Change; or (iii) will not result in any
violation of any federal or New York statute or any rule or
regulation that has been issued pursuant to any federal or New York
statute or any order known to such counsel issued pursuant to any
federal or New York statute by any court or governmental agency or
body or court having jurisdiction over the Company or any
subsidiary.
(v) No consent, approval, authorization or other order of, or
registration or filing with, any federal or New York court,
governmental authority or agency, is required for the Company's
execution, delivery and performance of the Underwriting Agreement
and consummation of the transactions contemplated thereby and by the
Prospectus, except as required under the Securities Act, applicable
state securities or blue sky laws and from the NASD.
(vi) Each of the Registration Statement and the Rule 462(b)
Registration Statement, if any, has been declared effective by the
Commission under the Securities Act. To the knowledge of such
counsel, no stop order suspending the effectiveness of either of the
Registration Statement or the Rule 462(b) Registration Statement, if
any, has been issued under the Securities Act and no proceedings for
such purpose have been instituted or are pending or are contemplated
or threatened by the Commission. Any required filing of the
Prospectus and any supplement thereto pursuant to Rule 424(b) under
the Securities Act has been made in the manner and within the time
period required by such Rule 424(b).
3
(vii) The statements (i) in the Prospectus under the captions
"Risk Factors--Restrictions Imposed Under New Credit Facility" and
"-- Fraudulent Conveyance", "Management's Discussion and Analysis
and Results of Operations--Liquidity", "Description of New Credit
Facility" and "Underwriting" and (ii) in Item 14 and Item 15 of the
Registration Statement, insofar as such statements constitute
matters of law, summaries of legal matters, the Company's charter or
by-law provisions, documents or legal proceedings, or legal
conclusions, has been reviewed by such counsel and fairly present
and summarize, in all material respects, the matters referred to
therein.
(viii) The Company is not, and after receipt of payment for
the Securities and for the Common Shares will not be, an "investment
company" within the meaning of the Investment Company Act and the
rules and regulations of the Commission thereunder.
(ix) The Registration Statement, including any Rule 462(b)
Registration Statement, the Prospectus and each amendment or
supplement to the Registration Statement and the Prospectus as of
their respective effective or issue dates (other than the financial
statements and supporting schedules included or incorporated by
reference therein or in exhibits to or excluded from the
Registration Statement, and the Form T-1 forming a part of the
Registration Statement, in each case as to which no opinion need be
rendered) comply as to form in all material respects with the
applicable requirements of the Securities Act and the Trust
Indenture Act and the applicable rules and regulations of the
Commission thereunder.
In addition, such counsel shall state that they have participated in
conferences with officers and other representatives of the Company,
representatives of the independent public or certified public accountants
for the Company and with representatives of the Underwriters at which the
contents of the Registration Statement and the Prospectus, and any
supplements or amendments thereto, and related matters were discussed and,
although such counsel is not passing upon and does not assume any
responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectus
(other than as specified above in paragraphs (ii) and (vii), and any
supplements or amendments thereto, on the basis of the foregoing, nothing
has come to their attention which has led them to believe that either the
Registration Statement or any amendments thereto, at the time the
Registration Statement or such amendments became effective, contained an
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading or that the Prospectus, as of its date and at the Closing
Date, contained an untrue statement of a material fact or omitted 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 such counsel need express no belief as to the Form
T-1 and
4
as to the financial statements or schedules or other financial or
statistical data derived therefrom, included in the Registration Statement
or the Prospectus or any amendments or supplements thereto).
In rendering such opinion, such counsel may rely (A) as to
matters involving the application of laws of any jurisdiction other than
the General Corporation Law of the State of Delaware, the law of the State
of New York or the federal law of the United States, to the extent they
deem proper and specified in such opinion, upon the opinion (which shall
be dated the Closing Date, shall be satisfactory in form and substance to
the Underwriters, shall expressly state that the Underwriters may rely on
such opinion as if it were addressed to them and shall be furnished to the
Representative) of other counsel of good standing whom they believe to be
reliable and who are satisfactory to counsel for the Underwriters;
provided, however, that such counsel shall further state that they believe
that they and the Underwriters are justified in relying upon such opinion
of other counsel, and (B) as to matters of fact, to the extent they deem
proper, on certificates of responsible officers of the Company and public
officials.
References to the Prospectus in this Exhibit A include any
supplements thereto at the Closing Date.
EXHIBIT A-2
Opinion to be delivered pursuant to Section 6(f) of the Underwriting
Agreement by ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, General Counsel of the Company and/or by
[▇▇▇▇▇▇/Hall], Massachusetts counsel to the Company, which opinions may be
divided among such counsel in any manner satisfactory to counsel to the
Underwriters. References to the Prospectus in this Exhibit A-2 include any
supplements thereto at the Closing Date.
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
Commonwealth of Massachusetts.
(ii) The Company has full corporate power and authority to
own, lease and operate its properties and to conduct its business as
described in the Prospectus and to enter into and perform its
obligations under the Underwriting Agreement.
(iii) The Company is duly qualified as a foreign corporation
to transact business and is in good standing in the States of
____________ and in each other jurisdiction in which such
qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except for such
jurisdictions (other than the States of ___________) where the
failure to so qualify or to be in good standing would not,
individually or in the aggregate, result in a Material Adverse
Change.
(iv) Each subsidiary has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has full corporate power and
authority to own, lease and operate its properties and to conduct
its business as described in the Prospectus and, to the knowledge of
such counsel, is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except for such
jurisdictions where the failure to so qualify or to be in good
standing would not, individually or in the aggregate, result in a
Material Adverse Change.
(v) The Company has an authorized capitalization as set forth
in the Prospectus, and all of the issued and outstanding capital
stock of each subsidiary has been duly authorized and validly
issued, is fully paid and non-assessable and is owned by the
Company, directly or through subsidiaries, free and clear of any
security interest, mortgage, pledge, lien, encumbrance or, to the
knowledge of such counsel, any pending or threatened claim.
2
(vi) The Indenture has been duly authorized, executed and
delivered by the Company and the Subsidiary Guarantor. The
Securities have been duly authorized, executed and issued by the
Company.
(vii) The Underwriting Agreement has been duly authorized,
executed and delivered by, and is a valid and binding agreement of,
the Company and the Subsidiary Guarantor.
(viii) The statements (i) in the Prospectus under the captions
"Prospectus Summary -- Recent Developments", "Risk Factors--
Relationships with ▇▇▇▇▇▇▇; Potential Conflicts of Interest;
Dependence on Senior Management", "--Regulation" and "--Effect of
Certain Anti-Takeover Provisions", "Management's Discussion and
Analysis and Results of Operations--Liquidity", "Business--Licenses
and Trademarks" and "-- Government Regulation and Legal
Proceedings", "Management", "Certain Transactions" and
"Underwriting" and (ii) in Item 14 and Item 15 of the Registration
Statement, insofar as such statements constitute matters of law,
summaries of legal matters, the Company's charter or by-law
provisions, documents or legal proceedings, or legal conclusions,
has been reviewed by such counsel and fairly present and summarize,
in all material respects, the matters referred to therein.
(ix) The execution and delivery of the Underwriting Agreement
by the Company and the performance by the Company of its obligations
thereunder (other than performance by the Company of its obligations
under the indemnification section of the Underwriting Agreement, as
to which no opinion need be rendered) (i) have been duly authorized
by all necessary corporate action on the part of the Company; (ii)
will not result in any violation of the provisions of the charter or
by-laws of the Company or any subsidiary; (iii) will not constitute
a breach of, or Default or a Debt Repayment Triggering Event under,
or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of its
subsidiaries pursuant to, any material Existing Instrument, except
for such breaches, Defaults, liens, charges or encumbrances as would
not, individually or in the aggregate, result in a Material Adverse
Change; or (iv) to the knowledge of such counsel, will not result in
any violation of any law, administrative regulation or
administrative or court decree applicable to the Company or any
subsidiary, except for such violations as would not, individually or
in the aggregate, result in a Material Adverse Change.
(x) No consent, approval, authorization or other order of, or
registration or filing with, any court or other governmental
authority or agency, is required for the Company's execution,
delivery and performance of the Underwriting Agreement and
consummation of the transactions contemplated thereby and by the
Prospectus, except as required under the
3
Securities Act, applicable state securities or blue sky laws and
from the NASD.
(xi) To the knowledge of such counsel, there are no Existing
Instruments required to be described or referred to in the
Registration Statement or to be filed as exhibits thereto other than
those described or referred to therein or filed as exhibits thereto;
and the descriptions thereof and references thereto are correct in
all material respects.
(xii) To the knowledge of such counsel, neither the Company
nor any subsidiary is in violation of its charter or by-laws or any
law, administrative regulation or administrative or court decree
applicable to the Company or any subsidiary or is in Default in the
performance or observance of any obligation, agreement, covenant or
condition contained in any material Existing Instrument, except in
each such case for such violations or Defaults as would not,
individually or in the aggregate, result in a Material Adverse
Change.
(xiii) Except as disclosed in the Prospectus, to the knowledge
of such counsel, there are no persons with registration or other
similar rights to have any equity or debt securities registered for
sale under the Registration Statement or included in the offering
contemplated by the Underwriting Agreement, except for such rights
as have been duly waived.
(xiv) To the knowledge of such counsel, there are no legal or
governmental actions, suits or proceedings pending or threatened
which are required to be disclosed in the Registration Statement,
other than those disclosed therein.
(xv) The Company and each of its subsidiaries have good and
marketable title in fee simple to all real property owned by them,
in each case free and clear of all liens, encumbrances and defects
except such as are described in the Prospectus or such as do not
materially affect the value of such property and do not materially
interfere with the use made and proposed to be made of such property
by the Company and its subsidiaries; and all real property and
buildings held under lease by the Company and its subsidiaries are
held by them under valid, subsisting and enforceable leases, with
such exceptions as are not material and do not interfere with the
use made and proposed to be made of such property and buildings by
the Company and its subsidiaries.
(xvi) To such counsel's knowledge and other than as set forth
in the Prospectus, (A) the Company possesses such certificates,
authorizations or permits issued by the appropriate state, federal
or foreign regulatory agencies or bodies necessary to conduct the
business now operated by it, except where the failure to possess
such certificates, authorizations or
4
permits would not be reasonably expected to result in a Material
Adverse Change, and (B) the Company has not received any notice of
proceedings relating to the revocation or modification of any such
certificate, authorization or permit which, singularly or in the
aggregate, if the subject of an unfavorable decision, ruling, or
finding, would be reasonably expected to result in a Material
Adverse Change.
(xvii) To such counsel's knowledge and other than as set forth
in the Prospectus, the Company and each of 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 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.
In rendering the opinion referred to in subsection (xv) above, such
counsel may state that no examination of record titles for the purpose of
such opinion has been made, and that they are relying upon a general
review of the titles of the Company and its subsidiaries, upon opinions of
local counsel and abstracts, reports and policies of title companies
rendered or issued at or subsequent to the time of acquisition of such
property by the Company or its subsidiaries, upon opinions of counsel to
the lessors of such property and, in respect of matters of fact, upon
certificates of officers of the Company or its subsidiaries, provided that
such counsel shall state that they believe that both the Underwriters and
they are justified in relying upon such opinions, abstracts, reports,
policies and certificates.
In addition, such counsel shall state that they have participated in
conferences with officers and other representatives of the Company,
representatives of the independent public or certified public accountants
for the Company and with representatives of the Underwriters at which the
contents of the Registration Statement and the Prospectus, and any
supplements or amendments thereto, and related matters were discussed and,
although such counsel is not passing upon and does not assume any
responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectus
(other than as specified above in paragraphs (v) and (viii), and any
supplements or amendments thereto, on the basis of the foregoing, nothing
has come to their attention which has lead them to believe that either the
Registration Statement or any amendments thereto, at the time the
Registration Statement or such amendments became effective, contained an
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading or that the Prospectus, as of its date and at the Closing
Date, contained an untrue statement of a material fact or omitted 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 such counsel need express no belief as to the Form
T-1 and
5
as to the financial statements or schedules or other financial or
statistical data derived therefrom, included in the Registration Statement
or the Prospectus or any amendments or supplements thereto).
References to the Prospectus in this Exhibit A include any
supplements thereto at the Closing Date.