EXHIBIT 2.1
BWAY FINANCE CORP.
$ 200,000,000.00
10% SENIOR SUBORDINATED NOTES DUE 2010
PURCHASE AGREEMENT
November 21, 2002
DEUTSCHE BANK SECURITIES INC.
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
BWAY Finance Corp., a Delaware corporation (the "Company"), hereby
confirms its agreement with you (the "Initial Purchaser"), as set forth below.
1. The Securities. Subject to the terms and conditions herein
contained, the Company proposes to issue and sell to the Initial Purchaser (the
"Offering") $200,000,000 aggregate principal amount of its 10% Senior
Subordinated Notes due 2010 (the "Notes"). The Notes are to be issued under an
indenture (the "Indenture") to be dated as of November 27, 2002 by and between
the Company and The Bank of New York, as Trustee (the "Trustee"). In connection
with the consummation of the Transactions (as defined below), as discussed in
the Final Memorandum (as defined herein), BWAY Corporation, a Delaware
corporation ("BWAY"), pursuant to an Assumption Agreement by and among BWAY, the
Company and BWAY Manufacturing, Inc. (as defined below) (the "Assumption
Agreement"), in the form attached to the Escrow Agreement (as defined below),
and pursuant to a Supplemental Indenture, in the form attached to the Escrow
Agreement, by and among the Trustee, BWAY, the Company and BWAY Manufacturing,
Inc. (the "Supplemental Indenture"), will assume the obligations of the Company
under the Notes, the Indenture, this Agreement, the Registration Rights
Agreement and the Escrow Agreement (as each term is defined herein). Pursuant to
the Supplemental Indenture, BWAY Manufacturing, Inc., a Delaware corporation
("BWAY Manufacturing" and together with the Company and BWAY, the "Issuers")
will also unconditionally guarantee (the "Guarantee") the Notes on a senior
subordinated basis in accordance with the applicable terms of the Indenture and,
pursuant to the Assumption Agreement, BWAY Manufacturing, will guarantee BWAY's
obligations under this Agreement, the Registration Rights Agreement and the
Escrow Agreement.
The Notes will be offered and sold to the Initial Purchaser without
being registered under the Securities Act of 1933, as amended (the "Act"), in
reliance on exemptions therefrom.
In connection with the sale of the Notes, the Company has prepared a
preliminary offering memorandum dated November 8, 2002 (the "Preliminary
Memorandum") and a final offering memorandum dated November 21, 2002 (the "Final
Memorandum"; the Preliminary Memorandum and the Final Memorandum each herein
being referred to as a "Memorandum") setting forth or including a description of
the terms of the Notes, the terms of the offering of the Notes, a description of
the Company and of BWAY and any material developments relating to the Company or
to BWAY occurring after the date of the most recent historical financial
statements included therein.
The Notes are being sold in connection with (i) the consummation of a
merger (the "Merger") of BCO Acquisition, Inc., a Delaware corporation ("BCO
Acquisition"), a company which, as of the date hereof, is wholly-owned by
affiliates of ▇▇▇▇▇ & Company, L.P. ("▇▇▇▇▇"), with and into BWAY, pursuant to
an Agreement and Plan of Merger dated as of September 30, 2002 (as the same may
be amended, the "Merger Agreement") and (ii) BWAY's tender offer for, and
consent solicitation with respect to, up to $100,000,000 aggregate principal
amount of its outstanding 10 1/4% Senior Subordinated Notes (the "10 1/4% Senior
Subordinated Notes") due 2007 (the "Tender Offer"), pursuant to an offer to
purchase by BWAY. The date of consummation of the Merger and execution of the
Assumption Agreement and the Supplemental Indenture is referred to as the
"Transactions Closing Date."
On the Transactions Closing Date, BWAY expects to enter into an
amended and restated credit agreement (the "Credit Agreement") with Deutsche
Bank Trust Company Americas, as agent, and certain lenders thereto whereby BWAY
will be provided with a $90 million revolving credit facility, subject to
borrowing base and other limitations in the Credit Agreement.
The Offering, the Tender Offer, the Merger and the related borrowings
under the Credit Agreement are collectively referred to as the "Transactions."
The Initial Purchaser and its direct and indirect transferees of the
Notes will be entitled to the benefits of the Registration Rights Agreement,
substantially in the form attached hereto as Exhibit A (the "Registration Rights
Agreement"), pursuant to which the Company has agreed, among other things, to
file a registration statement (the "Registration Statement") with the Securities
and Exchange Commission (the "Commission") registering the Notes or the Exchange
Notes (as defined in the Registration Rights Agreement) under the Act.
On the Closing Date (as defined in Section 3 below), the Company will
deposit with The Bank of New York, as escrow agent (the "Escrow Agent") the
proceeds (the "Escrowed Funds") of the Offering, together with certain other
funds made available to the Company (the "Escrowed Funds"). Upon the
satisfaction of certain conditions as set forth in an escrow agreement to be
dated as of the Closing Date among the Company, the Trustee and the Escrow Agent
(the "Escrow Agreement"), including the assumption by BWAY of the Company's
obligations under the Notes and the Indenture pursuant to the Supplemental
Indenture (the "BWAY Assumption"), the portion of the Escrowed Funds equal to
the net proceeds of the Offering, after giving effect to the payment by the
Company of all fees and expenses hereunder, including without limitation
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under Sections 3(b) and 6 hereof, will be released to BWAY and the balance of
the Escrowed Funds will be released to the Company.
2. Representations and Warranties. The Company represents and warrants
to and agrees with the Initial Purchaser that:
(a) Neither the Preliminary Memorandum as of the date thereof nor the
Final Memorandum nor any amendment or supplement thereto as of the date
thereof and at the Closing Date contained or will contain any untrue
statement of a material fact or omitted or will omit to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except that the
representations and warranties set forth in this Section 2(a) do not apply
to statements or omissions (i) made in reliance upon and in conformity with
information relating to the Initial Purchaser furnished to the Company in
writing by the Initial Purchaser expressly for use in the Preliminary
Memorandum, the Final Memorandum or any amendment or supplement thereto or
(ii) made in any Memorandum (including all supplements and amendments
thereto) that are corrected in the Final Memorandum, as amended and
supplemented to the date hereof.
(b) To the Company's knowledge, BWAY has the authorized, issued and
outstanding capitalization set forth in the Final Memorandum; all of the
direct and indirect subsidiaries of BWAY are listed in Schedule 2 attached
hereto (each, a "Subsidiary" and collectively, the "Subsidiaries"); as of
the Closing Date, after giving effect to the Transactions, all of the
outstanding shares of capital stock of BWAY and the Subsidiaries will be
duly authorized and validly issued, fully paid and nonassessable and will
not have been issued in violation of any preemptive or similar rights; all
of the outstanding shares of capital stock of BWAY and of each of the
Subsidiaries will be free and clear of all liens, encumbrances, equities
and claims or restrictions on transferability or voting (other than those
imposed by the Act and the securities or "Blue Sky" laws of certain
jurisdictions and those arising under the Credit Agreement and the
Securityholders Agreement to be entered into in connection with the Merger
as described in the Offering Memorandum (the "Securityholders Agreement");
and except as set forth in the Final Memorandum, the Merger Agreement or
the proxy statement relating to the approval of the Merger by BWAY's
stockholders (as amended or supplemented, the "Proxy Statement"), as of the
Closing Date or as provided for in the Securityholders Agreement, there
will be no (i) options, warrants or other rights to purchase, (ii)
agreements or other obligations to issue or (iii) other rights to convert
any obligation into, or exchange any securities for, shares of capital
stock of or ownership interests in BWAY or any of the Subsidiaries
outstanding. Except for the Subsidiaries or as disclosed in the Final
Memorandum, the Merger Agreement or the Proxy Statement, BWAY does not own,
directly or indirectly, any shares of capital stock or any other equity or
long-term debt securities or have any equity interest in any firm,
partnership, joint venture or other entity.
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(c) Each of the Company, BWAY and the Subsidiaries is duly
incorporated, validly existing and in good standing under the laws of its
respective jurisdiction of organization and has all requisite corporate
power and authority to own its properties and conduct its business as now
conducted and as described in the Final Memorandum; each of the Company,
BWAY and the Subsidiaries is duly qualified to do business as a foreign
corporation in good standing in all other jurisdictions where the ownership
or leasing of its properties or the conduct of its business requires such
qualification, except where the failure to be so qualified would not,
individually or in the aggregate, have a material adverse effect on the
general affairs, management, business, condition (financial or otherwise),
prospects or results of operations of BWAY and the Subsidiaries, taken as a
whole (any such event, a "Material Adverse Effect").
(d) The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under the Notes, the Exchange
Notes and the Private Exchange Notes (as defined in the Registration Rights
Agreement). The Notes, when issued, will be substantially in the form
contemplated by the Indenture. The Notes, the Exchange Notes and the
Private Exchange Notes have each been duly and validly authorized by the
Company and, when duly executed by the Company and authenticated by the
Trustee in accordance with the provisions of the Indenture and, in the case
of the Notes, when delivered to and paid for by the Initial Purchaser in
accordance with the terms of this Agreement (or issued by the Company in
accordance with the Registration Rights Agreement and the Indenture, in the
case of the Exchange Notes and the Private Exchange Notes), will constitute
valid and legally binding obligations of the Company, entitled to the
benefits of the Indenture, and enforceable against the Company in
accordance with their terms, except that enforcement thereof may be subject
to (i) bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally and (ii) general principals or equity
(regardless of whether enforcement is considered in a proceeding in equity
or at law) and the discretion of the court before which any proceeding
therefore may be brought. Upon the due authorization, execution and
delivery of the Supplemental Indenture and the Assumption Agreement by BWAY
and each of the other parties thereto (or, in the case of the Exchange
Notes and the Private Exchange Notes, upon the issuance by BWAY in
accordance with the Registration Rights Agreement and the Indenture), the
Notes, the Exchange Notes or the Private Exchange Notes, as the case may
be, will constitute valid and legally binding obligations of BWAY, entitled
to the benefits of the Indenture, and enforceable against BWAY in
accordance with their terms, except that the enforcement thereof may be
subject to (i) bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally and (ii) general principles of
equity (regardless of whether enforcement is considered in a proceeding in
equity or at law) and the discretion of the court before which any
proceeding therefor may be brought.
(e) The Guarantor has all requisite corporate power and authority to
execute, deliver and perform its obligations under the Guarantee and the
Guarantee of the Exchange
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Notes and the Private Exchange Notes. Upon the due authorization, execution
and delivery of the Supplemental Indenture and the Assumption Agreement by
BWAY, BWAY Manufacturing and each of the other parties thereto, the
Guarantee will constitute a valid and legally binding obligation of BWAY
Manufacturing, entitled to the benefits of the Indenture and enforceable
against BWAY Manufacturing in accordance with its terms, except that the
enforcement thereof may be subject to (i) bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium or other similar laws now
or hereafter in effect relating to creditors' rights generally and (ii)
general principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law) and the discretion of the
court before which any proceeding therefor may be brought.
(f) The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under the Indenture. The
Indenture meets the requirements for qualification under the Trust
Indenture Act of 1939, as amended (the "TIA"). The Indenture has been duly
authorized by all requisite corporate action of the Company and, when duly
executed and delivered by the Company (assuming the due authorization,
execution and delivery by the Trustee), will constitute a valid and legally
binding agreement of the Company and, upon the due authorization, execution
and delivery of the Supplemental Indenture by BWAY and each of the other
parties thereto, of BWAY enforceable against BWAY in accordance with its
terms, except that the enforcement thereof may be subject to (i)
bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium
or other similar laws now or hereafter in effect relating to creditors'
rights generally and (ii) general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity or at law) and
the discretion of the court before which any proceeding therefor may be
brought.
(g) The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under the Registration Rights
Agreement. The Registration Rights Agreement has been duly and validly
authorized by the Company and, when duly executed and delivered by the
Company (assuming the due authorization, execution and delivery by the
Initial Purchaser), will constitute a valid and legally binding agreement
of the Company and, upon the due authorization, execution and delivery of
the Assumption Agreement by BWAY and each of the other parties thereto, of
BWAY enforceable against BWAY and BWAY Manufacturing in accordance with its
terms, except that (A) the enforcement thereof may be subject to (i)
bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium
or other similar laws now or hereafter in effect relating to creditors'
rights generally and (ii) general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity or at law) and
the discretion of the court before which any proceeding therefor may be
brought and (B) any rights to indemnity or contribution thereunder may be
limited by federal and state securities laws and public policy
considerations.
(h) The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under the Escrow Agreement.
The Escrow Agreement
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has been duly and validly authorized by the Company and, when duly executed
and delivered by the Company and, assuming the due authorization, execution
and delivery by the Escrow Agent and the Trustee, will constitute a valid
and legally binding agreement of the Company, enforceable against the
Company in accordance with its terms, except that the enforcement thereof
may be subject to (i) bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally and (ii) general principles of
equity (regardless of whether enforcement is considered in a proceeding in
equity or at law) and the discretion of the court before which any
proceeding therefor may be brought. Assuming the due authorization,
execution and delivery of the Assumption Agreement by each of the parties
thereto, the Escrow Agreement will constitute a valid and legally binding
agreement of each Issuer, enforceable against each Issuer in accordance
with its terms, except that the enforcement thereof may be subject to (i)
bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium
or other similar laws now or hereafter in effect relating to creditors'
rights generally and (ii) general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity or at law) and
the discretion of the court before which any proceeding therefore may be
brought.
(i) Each of the Issuers has all requisite corporate power and
authority to execute, deliver and perform its obligations under the
Assumption Agreement. Assuming the due authorization, execution and
delivery of the Assumption Agreement by each of the parties thereto, the
Assumption Agreement will constitute a valid and legally binding agreement
of each Issuer, enforceable against each Issuer in accordance with its
terms, except that the enforcement thereof may be subject to (i)
bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium
or other similar laws now or hereafter in effect relating to creditors'
rights generally and (ii) general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity or at law) and
the discretion of the court before which any proceeding therefore may be
brought.
(j) The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby. This Agreement and the
consummation by the Company of the transactions contemplated hereby have
been duly and validly authorized by the Company. This Agreement has been
duly executed and delivered by the Company.
(k) Except as disclosed in the Final Memorandum, no consent, approval,
authorization or order of any court or governmental agency or body, or
third party is required for the issuance and sale by the Company of the
Notes to the Initial Purchaser or the consummation by the Issuers of the
Transactions, except (i) such as may be required in connection with the
Merger, (ii) such as have been obtained and such as may be required under
state securities or "Blue Sky" laws in connection with the purchase and
resale of the Notes by the Initial Purchaser or the issuance by any Issuer
of the Exchange Notes or the Private Exchange Notes, (iii) the approval of
the requisite lenders under the Credit Agreement, dated as of May 22, 2001,
by and among ▇▇▇▇▇▇▇▇▇ Containers, Inc.,
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BWAY, BWAY Manufacturing and the other parties thereto, as amended (as the
case may hereinafter be amended, the "Credit Agreement"), (iv) the
registration under applicable law of the Exchange Notes and the Private
Exchange Notes (if applicable) and the qualification of the Indenture under
the TIA, (v) the approval by BWAY's stockholders of the Transactions and
(vi) the requisite consents from the holders of BWAY's 10 1/4% Senior
Subordinated Notes and, in all cases, except where the failure to obtain
such consent, approval, authorization or order would not, individually or
in the aggregate have a Material Adverse Effect. None of the Issuers is (i)
in violation of its certificate of incorporation or bylaws, (ii) in breach
or violation of any statute, judgment, decree, order, rule or regulation
applicable to any of them or any of their respective properties or assets,
except for any such breach or violation which would not, individually or in
the aggregate, have a Material Adverse Effect, or (iii) in breach of or
default under (nor has any event occurred that, with notice or passage of
time or both, would constitute a default under) or in violation of any of
the terms or provisions of any indenture, mortgage, deed of trust, loan
agreement, note, lease, license, franchise agreement, permit, certificate,
contract or other agreement or instrument to which any of them is a party
or to which any of them or their respective properties or assets is subject
(collectively, "Contracts"), except for any such breach, default, violation
or event that would not, individually or in the aggregate, have a Material
Adverse Effect.
(l) Except as disclosed in the Final Memorandum, the execution,
delivery and performance by the Company of this Agreement, the Indenture,
the Registration Rights Agreement, the Escrow Agreement, the Assumption
Agreement, the execution, delivery and performance by BWAY and BWAY
Manufacturing of the Assumption Agreement, the Supplemental Indenture and
the consummation by the Issuers of the Transactions (including, without
limitation, the issuance and sale of the Notes to the Initial Purchaser)
will not conflict with or constitute or result in a breach of or a default
under (or an event which with notice or passage of time or both would
constitute a default under) or violation of any of (i) the terms or
provisions of any Contract, except for any such conflict, breach,
violation, default or event which would not, individually or in the
aggregate, have a Material Adverse Effect, and except with respect to (x)
the Credit Agreement and (y) the indenture governing BWAY's 10 1/4% Senior
Subordinated Notes, (ii) the certificate of incorporation or bylaws of the
Company or of BWAY or any of the Subsidiaries or (iii) (assuming (x)
compliance with all applicable state securities or "Blue Sky" laws, (y) the
registration under applicable law of the Exchange Notes and the Private
Exchange Notes (if applicable) and the qualification of the Indenture under
the TIA and (z) the accuracy of the representations and warranties of the
Initial Purchaser in Section 8 hereof) any statute, judgment, decree,
order, rule or regulation applicable to the Company or to BWAY or any of
the Subsidiaries or any of their respective properties or assets, except as
may be required in connection with the Merger, and except for any such
conflict, breach or violation which would not, individually or in the
aggregate, have a Material Adverse Effect.
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(m) The audited consolidated financial statements of BWAY included in
the Final Memorandum present fairly in all material respects the financial
position, results of operations and cash flows of BWAY and the Subsidiaries
at the dates and for the periods to which they relate and have been
prepared in accordance with United States generally accepted accounting
principles applied on a consistent basis throughout the periods involved,
except as otherwise stated therein or in the notes thereto. The summary and
selected financial and statistical data, exclusive of pro forma data, in
the Final Memorandum present fairly in all material respects the
information shown therein and have been prepared and compiled on a basis
consistent with the audited financial statements included therein, except
as otherwise stated therein. To the Company's knowledge, Deloitte & Touche
LLP (the "Independent Accountants") is an independent public accounting
firm within the meaning of the Act and the rules and regulations
promulgated thereunder.
(n) The pro forma financial statements (including the notes thereto)
included in the Final Memorandum present fairly in all material respects
the information shown therein and have been prepared in accordance with the
Commission's rules and guidelines with respect to pro forma financial
statements under the Act and have been properly computed on the bases
described therein; the assumptions used in the preparation of the pro forma
financial statements included in the Final Memorandum are reasonable and
the adjustments used therein are appropriate to give effect to the
transactions or circumstances referred to therein.
(o) Except as disclosed in the Final Memorandum, there is not pending
or, to the knowledge of the Company, threatened any action, suit,
proceeding, inquiry or investigation to which BWAY or any of the
Subsidiaries is a party, or to which the respective property or assets of
BWAY or any of the Subsidiaries are subject, before or brought by any
court, arbitrator or governmental agency or body that, if determined
adversely to BWAY or any of the Subsidiaries, would, individually or in the
aggregate, have a Material Adverse Effect, or which seeks to restrain,
enjoin, prevent the consummation of or otherwise challenge the issuance or
sale of the Notes to be sold hereunder or the consummation of the other
transactions described in the Final Memorandum.
(p) Each of the Company, BWAY and the Subsidiaries possesses all
licenses, permits, certificates, consents, orders, approvals and other
authorizations from, and has made all declarations and filings with, all
federal, state, local and other governmental authorities, all
self-regulatory organizations and all courts and other tribunals, presently
required or necessary to own or lease, as the case may be, and to operate
its respective properties and to carry on its respective businesses as now
or proposed to be conducted as set forth in the Final Memorandum
("Permits"), except where the failure to obtain such Permits would not,
individually or in the aggregate, have a Material Adverse Effect; each of
the Company, BWAY and the Subsidiaries has fulfilled and performed all of
its obligations with respect to such Permits and no event has occurred that
allows, or after notice or lapse of time would allow, revocation or
termination thereof or results in any other material
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impairment of the rights of the holder of any such Permit, except where the
failure to fulfill and perform such obligations, or such revocation,
termination or material impairment would not, individually or in the
aggregate, have a Material Adverse Effect; and none of the Company, BWAY or
the Subsidiaries has received any notice of any proceeding relating to
revocation or modification of any such Permit, except as described in the
Final Memorandum and except where such revocation or modification would
not, individually or in the aggregate, have a Material Adverse Effect.
(q) Since the date of the most recent financial statements appearing
in the Final Memorandum, except as described in the Final Memorandum, (i)
none of the Company, BWAY or the Subsidiaries has incurred any liabilities
or obligations, direct or contingent, or entered into or agreed to enter
into any transactions or contracts (written or oral) not in the ordinary
course of business, which liabilities, obligations, transactions or
contracts would, individually or in the aggregate have a Material Adverse
Effect, (ii) none of the Company, BWAY or the Subsidiaries has purchased
any of its outstanding capital stock, nor declared, paid or otherwise made
any dividend or distribution of any kind on its capital stock (other than
with respect to any of such Subsidiaries, the purchase of, or dividend or
distribution on, capital stock owned by BWAY) and (iii) there shall not
have been any material change in the capital stock or long-term
indebtedness of BWAY or the Subsidiaries.
(r) Except as disclosed in the Merger Agreement or the Proxy
Statement, each of the Company, BWAY and the Subsidiaries has filed all
necessary federal, state and foreign income and franchise tax returns,
except where the failure to so file such returns would not, individually or
in the aggregate, have a Material Adverse Effect, and has paid all taxes
shown as due thereon; and, except as disclosed in the Merger Agreement or
the Proxy Statement, other than tax deficiencies which BWAY or any
Subsidiary, as the case may be, is contesting in good faith and for which
BWAY or such Subsidiary, as the case may be, has provided adequate
reserves, there is no tax deficiency that has been asserted against BWAY or
any of the Subsidiaries that would have, individually or in the aggregate,
a Material Adverse Effect.
(s) The statistical and market-related data included in the Final
Memorandum are based on or derived from sources which the Company, BWAY and
the Subsidiaries believe to be reliable and accurate.
(t) None of the Company, or any agent acting on its behalf and, upon
BWAY's and BWAY Manufacturing's due authorization, execution and delivery
of the Supplemental Indenture and the Assumption Agreement, none of BWAY,
the Subsidiaries or any agent acting on their behalf, has taken or will
take any action that might cause this Agreement or the sale of the Notes to
violate Regulation T, U or X of the Board of Governors of the Federal
Reserve System, in each case as in effect, or as the same may hereafter be
in effect, on the Closing Date.
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(u) Each of the Company, BWAY and the Subsidiaries has good and
marketable title to all real property and good title to all personal
property described in the Final Memorandum as being owned by it and good
and marketable title to a leasehold estate in the real and personal
property described in the Final Memorandum as being leased by it free and
clear of all liens, charges, encumbrances or restrictions, except as
described in the Final Memorandum or to the extent the failure to have such
title or the existence of such liens, charges, encumbrances or restrictions
would not, individually or in the aggregate, have a Material Adverse
Effect. All leases, contracts and agreements to which BWAY or any of the
Subsidiaries is a party or by which any of them is bound are valid and
enforceable against BWAY or such Subsidiary, as the case may be, and to the
knowledge of the Company, are valid and enforceable against the other party
or parties thereto and are in full force and effect with only such
exceptions as would not, individually or in the aggregate, have a Material
Adverse Effect. BWAY and the Subsidiaries own or possess adequate licenses
or other rights to use all patents, trademarks, service marks, trade names,
copyrights and know-how necessary to conduct the businesses now or proposed
to be operated by them as described in the Final Memorandum, ("Intellecutal
Property Rights"), except where the failure to own or possess such
Intellectual Property Rights would not, individually or in the aggregate,
have a Material Adverse Effect and none of BWAY or the Subsidiaries has
received any notice of infringement of or conflict with (or knows of any
such infringement of or conflict with) asserted rights of others with
respect to any patents, trademarks, service marks, trade names, copyrights
or know-how that, if such assertion of infringement or conflict were
sustained, would have a Material Adverse Effect.
(v) There are no legal or governmental proceedings involving or
affecting BWAY or any Subsidiary or any of their respective properties or
assets that would be required to be described in a prospectus pursuant to
the Act that are not described in the Final Memorandum, nor are there any
material contracts or other documents that would be required to be
described in a prospectus pursuant to the Act that are not generally
described in the Final Memorandum.
(w) Except as disclosed in the Final Memorandum and except as would
not, individually or in the aggregate, have a Material Adverse Effect, (A)
each of BWAY and the Subsidiaries is in compliance with and not subject to
liability under applicable Environmental Laws (as defined below), (B) each
of BWAY and the Subsidiaries has made all filings and provided all notices
required under any applicable Environmental Law, and is in compliance with
all Permits required under any applicable Environmental Laws and each of
them is in full force and effect, (C) there is no civil, criminal or
administrative action, suit, demand, claim, hearing, notice of violation,
investigation, proceeding, notice or demand letter or request for
information pending or, to the knowledge of BWAY or any of the
Subsidiaries, threatened against BWAY or any of the Subsidiaries under any
Environmental Law, (D) no lien, charge, encumbrance or restriction has been
recorded under any Environmental Law with respect to any assets, facility
or property owned, operated, leased or controlled by BWAY or any of the
Subsidiaries, (E) none of BWAY or the Subsidiaries
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has received notice that it has been identified as a potentially
responsible party under the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended ("CERCLA") or any
comparable state law, (F) no property or facility of BWAY or any of the
Subsidiaries is (i) listed or proposed for listing on the National
Priorities List under CERCLA or is (ii) listed in the Comprehensive
Environmental Response, Compensation, Liability Information System List
promulgated pursuant to CERCLA, or on any comparable list maintained by any
state or local governmental authority.
For purposes of this Agreement, "Environmental Laws" means the common
law and all applicable federal, state and local laws or regulations, codes,
orders, decrees, judgments or injunctions issued, promulgated, approved or
entered thereunder, relating to pollution or protection of public or
employee health and safety or the environment, including, without
limitation, laws relating to (i) emissions, discharges, releases or
threatened releases of hazardous materials into the environment (including,
without limitation, ambient air, surface water, ground water, land surface
or subsurface strata), (ii) the manufacture, processing, distribution, use,
generation, treatment, storage, disposal, transport or handling of
hazardous materials, and (iii) underground and above ground storage tanks
and related piping, and emissions, discharges, releases or threatened
releases therefrom.
(x) There is no strike, labor dispute, slowdown or work stoppage with
the employees of BWAY or any of the Subsidiaries that is pending or, to the
knowledge of the Company, threatened.
(y) Except as disclosed in the Final Memorandum, each of BWAY and the
Subsidiaries carries insurance in such amounts and covering such risks as
is adequate for the conduct of its business and the value of its
properties.
(z) None of the Company, BWAY or the Subsidiaries has any liability
for any prohibited transaction or funding deficiency or any complete or
partial withdrawal liability with respect to any pension, profit sharing or
other plan which is subject to the Employee Retirement Income Security Act
of 1974, as amended ("ERISA"), to which BWAY or any of the Subsidiaries
makes or ever has made a contribution and in which any employee of BWAY or
of any Subsidiary is or has ever been a participant which liability would
have, individually or in the aggregate, a Material Adverse Effect. With
respect to such plans, BWAY and each Subsidiary is in compliance in all
material respects with all applicable provisions of ERISA, except for such
noncompliances which would not, individually or in the aggregate, have a
Material Adverse Effect.
(aa) Each of the Company, BWAY and the Subsidiaries (i) makes and
keeps accurate books and records and (ii) maintains internal accounting
controls which provide reasonable assurance that (A) transactions are
executed in accordance with management's authorization, (B) transactions
are recorded as necessary to permit preparation of its financial statements
and to maintain accountability for its assets, (C) access to its assets is
-11-
permitted only in accordance with management's authorization and (D) the
reported accountability for its assets is compared with existing assets at
reasonable intervals.
(bb) None of the Company, BWAY or the Subsidiaries is or will be an
"investment company" or "promoter" or "principal underwriter" for an
"investment company," as such terms are defined in the Investment Company
Act of 1940, as amended, and the rules and regulations thereunder.
(cc) The Notes, the Indenture, the Registration Rights Agreement and
the Escrow Agreement will conform in all material respects to the
descriptions thereof in the Final Memorandum.
(dd) No holder of securities of BWAY or any Subsidiary will be
entitled to have such securities registered under the registration
statements required to be filed by the Company pursuant to the Registration
Rights Agreement or, upon the due authorization, execution and delivery of
the Assumption Agreement by BWAY and BWAY Manufacturing, by BWAY under the
registration statements required to be filed by BWAY pursuant to the
Registration Rights Agreement, other than as expressly permitted thereby.
(ee) Immediately after the consummation of the Transactions, the fair
value and present fair saleable value of the assets of each of BWAY and the
Subsidiaries (on a consolidated basis) will exceed the sum of its stated
liabilities and identified contingent liabilities; none of BWAY or the
Subsidiaries (on a consolidated basis) is, nor will any of BWAY or the
Subsidiaries (on a consolidated basis) be, after giving effect to the
execution, delivery and performance of this Agreement and the consummation
of the Transactions (a) left with unreasonably small capital with which to
carry on its business as it is proposed to be conducted, (b) unable to pay
its debts (contingent or otherwise) as they mature or (c) otherwise
insolvent.
(ff) None of the Company, or its Affiliates (as defined in Rule 501(b)
of Regulation D under the Act) has, and, to the knowledge of the Company,
none of BWAY, the Subsidiaries or any of their respective Affiliates, has,
directly, or through any agent, (i) sold, offered for sale, solicited
offers to buy or otherwise negotiated in respect of, any "security" (as
defined in the Act) which is or could be integrated with the sale of the
Notes in a manner that would require the registration under the Act of the
Notes or (ii) engaged in any form of general solicitation or general
advertising (as those terms are used in Regulation D under the Act) in
connection with the offering of the Notes or in any manner involving a
public offering within the meaning of Section 4(2) of the Act. Assuming the
accuracy of the representations and warranties of the Initial Purchaser in
Section 8 hereof, it is not necessary in connection with the offer, sale
and delivery of the Notes to the Initial Purchaser in the manner
contemplated by this Agreement to register any of the Notes under the Act
or to qualify the Indenture under the TIA.
(gg) No securities of BWAY or any Subsidiary are of the same class
(within the meaning of Rule 144A under the Act) as the Notes and listed on
a national securities exchange
-12-
registered under Section 6 of the Exchange Act, or quoted in a U.S.
automated inter-dealer quotation system.
(hh) The Company, has not, and to the knowledge of the Company, none
of BWAY or the Subsidiaries has taken, nor will any of them take, directly
or indirectly, any action designed to, or that might be reasonably expected
to, cause or result in stabilization or manipulation of the price of the
Notes.
(ii) None of the Company or any of its Affiliates or any person acting
on its or their behalf and, to the knowledge of the Company, none of BWAY,
the Subsidiaries or any of their respective Affiliates or any person acting
on its or their behalf (other than the Initial Purchaser), has engaged in
any directed selling efforts (as that term is defined in Regulation S under
the Act ("Regulation S")) with respect to the Notes; the Company and its
Affiliates and each person acting on its or their behalf and, to the
knowledge of the Company, BWAY, the Subsidiaries and any of their
respective Affiliates and any person acting on its or their behalf (other
than the Initial Purchaser), have complied with the offering restrictions
requirement of Regulation S.
3. Purchase, Sale and Delivery of the Notes. (a) On the basis of the
representations, warranties, agreements and covenants herein contained and
subject to the terms and conditions herein set forth, the Company agrees to
issue and sell to the Initial Purchaser, and the Initial Purchaser agrees to
purchase the Notes in the amount set forth on Schedule 1 hereto from the Company
at 100% of their principal amount. One or more certificates in definitive form
for the Notes that the Initial Purchaser has agreed to purchase hereunder, and
in such denomination or denominations and registered in such name or names as
the Initial Purchaser requests upon notice in writing to the Company at least 36
hours prior to the Closing Date, shall be delivered by or on behalf of the
Company to the Initial Purchaser, against payment by or on behalf of the Initial
Purchaser of the purchase price therefor by wire transfer (same day funds), to
such account or accounts as the Company shall specify prior to the Closing Date,
or by such means as the parties hereto shall agree prior to the Closing Date.
Such delivery of and payment for the Notes shall be made at the offices of
▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ at 8:00 A.M., New
York time, on November 27, 2002, or at such other place, time or date as the
Initial Purchaser, on the one hand, and the Company, on the other hand, may
agree upon, such time and date of delivery against payment being herein referred
to as the "Closing Date." The Company will make such certificate or certificates
for the Notes available for checking and packaging by the Initial Purchaser at
the offices of Deutsche Bank Securities Inc. in New York, New York, or at such
other place as Deutsche Bank Securities Inc. may designate, at least 24 hours
prior to the Closing Date.
(b) The Company agrees, and pursuant to the Assumption Agreement BWAY
will agree, to pay the Initial Purchaser on the Transactions Closing Date, by
wire transfer of immediately available funds, a fee of 3% of the net proceeds of
the Offering (i.e., $6,000,000). To the extent the Company fails to pay any such
amounts, BWAY shall assume all such payment amounts under the Assumption
Agreement.
-13-
4. Offering by the Initial Purchaser. The Initial Purchaser proposes
to make an offering of the Notes at the price and upon the terms set forth in
the Final Memorandum, as soon as practicable after this Agreement is entered
into and as in the judgment of the Initial Purchaser is advisable.
5. Covenants of the Company. The Company covenants and agrees with the
Initial Purchaser that:
(a) The Company will not amend or supplement the Final Memorandum or
any amendment or supplement thereto of which the Initial Purchaser shall
not previously have been advised and furnished a copy for a reasonable
period of time prior to the proposed amendment or supplement and as to
which the Initial Purchaser shall not have given its consent (which consent
shall not be unreasonably withheld). The Company will promptly, upon the
reasonable request of the Initial Purchaser or counsel for the Initial
Purchaser, make any amendments or supplements to the Preliminary Memorandum
or the Final Memorandum that may be necessary or advisable in connection
with the resale of the Notes by the Initial Purchaser.
(b) The Company will cooperate with the Initial Purchaser in arranging
for the qualification of the Notes for offering and sale under the
securities or "Blue Sky" laws of which jurisdictions as the Initial
Purchaser may designate and will continue such qualifications in effect for
as long as may be necessary to complete the resale of the Notes; provided,
however, that in connection therewith, the Company shall not be required to
qualify as a foreign corporation or to execute a general consent to service
of process in any jurisdiction or subject itself to taxation in excess of a
nominal dollar amount in any such jurisdiction where it is not then so
subject.
(c) If, at any time prior to the earlier of (i) completion of the
distribution by the Initial Purchaser of the Notes or the Private Exchange
Notes and (ii) two years from the Closing Date, any event occurs or
information becomes known as a result of which the Final Memorandum as then
amended or supplemented would include any untrue statement of a material
fact, or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, or if for any other reason it is necessary at any time to amend
or supplement the Final Memorandum to comply with applicable law, the
Company will promptly notify the Initial Purchaser thereof and will
prepare, at the expense of the Company, an amendment or supplement to the
Final Memorandum that corrects such statement or omission or effects such
compliance.
(d) The Company will, without charge, provide to the Initial Purchaser
and to counsel for the Initial Purchaser as many copies of the Preliminary
Memorandum and the Final Memorandum or any amendment or supplement thereto
as the Initial Purchaser may reasonably request.
-14-
(e) Upon BWAY's and BWAY Manufacturing's due authorization, execution
and delivery of the Supplemental Indenture and the Assumption Agreement,
BWAY will apply the net proceeds from the sale of the Notes as set forth
under "Use of Proceeds" in the Final Memorandum.
(f) For so long as any of the Notes remain outstanding, the Company,
and, upon BWAY's and BWAY Manufacturing's due authorization, execution and
delivery of the Supplemental Indenture and the Assumption Agreement, BWAY
will furnish to the Initial Purchaser copies of all reports and other
communications (financial or otherwise) furnished by the Company or BWAY to
the Trustee or to the holders of the Notes and, as soon as available,
copies of any reports or financial statements furnished to or filed by the
Company or BWAY with the Commission or any national securities exchange on
which any class of securities of BWAY may be listed.
(g) Prior to the Closing Date, the Company will furnish to the Initial
Purchaser, as soon as they have been prepared, a copy of any unaudited
interim financial statements of BWAY for any period subsequent to the
period covered by the most recent financial statements appearing in the
Final Memorandum.
(h) None of the Company, BWAY (with respect to BWAY, upon BWAY's and
BWAY Manufacutring's due authorization, execution and delivery of the
Supplemental Indenture and the Assumption Agreement) or any of their and
BWAY Manufacturing's Affiliates will sell, offer for sale or solicit offers
to buy or otherwise negotiate in respect of any "security" (as defined in
the Act) which could be integrated with the sale of the Notes in a manner
that would require the registration under the Act of the Notes.
(i) None of the Company or BWAY (with respect to BWAY, upon BWAY's and
BWAY Manufacturing's due authorization, execution and delivery of the
Supplemental Indenture and the Assumption Agreement) will, and will not
permit its Subsidiaries to, engage in any form of general solicitation or
general advertising (as those terms are used in Regulation D under the Act)
in connection with the offering of the Notes or in any manner involving a
public offering within the meaning of Section 4(2) of the Act.
(j) For so long as any of the Notes remain outstanding, the Company
and, upon BWAY's and BWAY Manufacturing's due authorization, execution and
delivery of the Supplemental Indenture and the Assumption Agreement, BWAY,
will make available at its expense, upon request, to any holder of such
Notes and any prospective purchasers thereof the information specified in
Rule 144A(d)(4) under the Act, unless the Company is then subject to
Section 13 or 15(d) of the Exchange Act.
(k) The Company will use its best efforts to (i) permit the Notes to
be designated PORTAL securities in accordance with the rules and
regulations adopted by the NASD relating to trading in the Private
Offerings, Resales and Trading through Automated Linkages market (the
"PORTAL Market") and (ii) permit the Notes to be eligible for clearance and
settlement through The Depository Trust Company.
-15-
(l) In connection with Notes offered and sold in an off shore
transaction (as defined in Regulation S) the Company will not register any
transfer of such Notes not made in accordance with the provisions of
Regulation S.
6. Expenses. The Company agrees to pay all costs and expenses incident
to the performance of its obligations under this Agreement, whether or not the
transactions contemplated herein are consummated or this Agreement is terminated
pursuant to Section 11 hereof, including all costs and expenses incident to (i)
the printing, word processing or other production of documents with respect to
the transactions contemplated hereby, including any costs of printing the
Preliminary Memorandum and the Final Memorandum and any amendment or supplement
thereto, and any "Blue Sky" memoranda, (ii) all arrangements relating to the
delivery to the Initial Purchaser of copies of the foregoing documents, (iii)
the fees and disbursements of the counsel, the accountants and any other experts
or advisors retained by the Company, (iv) preparation (including printing),
issuance and delivery to the Initial Purchaser of the Notes, (v) the
qualification of the Notes under state securities and "Blue Sky" laws, including
filing fees and fees and disbursements of counsel for the Initial Purchaser
relating thereto, (vi) expenses in connection with any meetings with prospective
investors in the Notes, (vii) fees and expenses of the Trustee in connection
with the Indenture and the Notes, including reasonable fees and expenses of
counsel, (viii) all expenses and listing fees incurred in connection with the
application for quotation of the Notes on the PORTAL Market and (ix) any fees
charged by investment rating agencies for the rating of the Notes. If the sale
of the Notes provided for herein is not consummated because any condition to the
obligations of the Initial Purchaser set forth in Section 7 hereof is not
satisfied, because this Agreement is terminated or because of any failure,
refusal or inability on the part of the Company to perform all obligations and
satisfy all conditions on their part to be performed or satisfied hereunder
(other than solely by reason of a default by the Initial Purchaser of its
obligations hereunder after all conditions hereunder have been satisfied in
accordance herewith), the Company agrees to promptly reimburse the Initial
Purchaser upon demand for all reasonable and itemized out-of-pocket expenses
(including reasonable fees, disbursements and charges of ▇▇▇▇▇▇ ▇▇▇▇▇▇ &
▇▇▇▇▇▇▇, counsel for the Initial Purchaser) that shall have been incurred by the
Initial Purchaser in connection with the proposed purchase and sale of the
Notes.
7. Conditions of the Initial Purchaser's Obligations. The obligation
of the Initial Purchaser to purchase and pay for the Notes shall be subject to
the satisfaction or waiver of the following conditions on or prior to the
Closing Date:
(a) On the Closing Date, the Initial Purchaser shall have received the
opinion, dated as of the Closing Date and addressed to the Initial
Purchaser, of Debevoise & ▇▇▇▇▇▇▇▇, counsel for the Company substantially
in the form set forth in Exhibit B attached hereto.
(b) On the Closing Date, the Initial Purchaser shall have received the
opinion, in form and substance satisfactory to the Initial Purchaser, dated
as of the Closing Date, and addressed to the Initial Purchaser, of ▇▇▇▇▇▇
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, counsel for the Initial Purchaser, with respect to
certain legal matters relating to this Agreement and such other related
matters as the Initial Purchaser may reasonably require. In rendering such
opinion,
-16-
▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ shall have received and may rely upon such
certificates and other documents and information as it may reasonably
request to pass upon such matters.
(c) The Initial Purchaser shall have received from the Independent
Accountants a comfort letter or letters dated the date hereof and the
Closing Date, in form and substance satisfactory to counsel for the Initial
Purchaser.
(d) The representations and warranties of the Company contained in
this Agreement shall be true and correct on and as of the date hereof and
on and as of the Closing Date as if made on and as of the Closing Date; the
statements of the Company's officers made pursuant to any certificate
delivered in accordance with the provisions hereof shall be true and
correct on and as of the date made and on and as of the Closing Date; the
Company shall have performed in all material respects all covenants and
agreements and satisfied all conditions on their part to be performed or
satisfied hereunder at or prior to the Closing Date; and, except as
described in the Final Memorandum (exclusive of any amendment or supplement
thereto after the date hereof), subsequent to the date of the most recent
financial statements in such Final Memorandum, there shall have been no
event or development, and no information shall have become known, that,
individually or in the aggregate, has or would be reasonably likely to have
a Material Adverse Effect.
(e) The sale of the Notes hereunder shall not be enjoined (temporarily
or permanently) on the Closing Date.
(f) Except as described in the Final Memorandum, subsequent to the
date of the most recent financial statements in the Final Memorandum
(exclusive of any amendment or supplement thereto after the date hereof),
none of BWAY or any of the Subsidiaries shall have sustained any loss or
interference with respect to its business or properties from fire, flood,
hurricane, accident or other calamity, whether or not covered by insurance,
or from any strike, labor dispute, slow down or work stoppage or from any
legal or governmental proceeding, order or decree, which loss or
interference, individually or in the aggregate, has or would be reasonably
likely to have a Material Adverse Effect.
(g) The Initial Purchaser shall have received a certificate of the
Company, dated the Closing Date, signed on behalf of the Company by its
Chairman of the Board, President or any Vice President and the Vice
President and Secretary, to the effect that:
(i) The representations and warranties of the Company contained
in this Agreement are true and correct on and as of the date hereof
and on and as of the Closing Date, and the Company has performed in
all material respects all covenants and agreements and satisfied all
conditions on its part to be performed or satisfied hereunder at or
prior to the Closing Date;
(ii) At the Closing Date, except as described in the Final
Memorandum, since the date of the most recent financial statements in
the Final Memorandum (exclusive of any amendment or supplement thereto
after the date hereof), no
-17-
event or development has occurred, and no information has become
known, that, individually or in the aggregate, has or would be
reasonably likely to have a Material Adverse Effect; and
(iii) The sale of the Notes hereunder has not been enjoined
(temporarily or permanently).
(h) On the Closing Date, the Initial Purchaser shall have received the
Registration Rights Agreement executed by the Company and such agreement
shall be in full force and effect.
(i) On the Closing Date, the Escrow Agreement shall have been executed
and delivered by all parties thereto.
On or before the Closing Date, the Initial Purchaser and counsel for
the Initial Purchaser shall have received such further documents, opinions,
certificates, letters and schedules or instruments relating to the business,
corporate, legal and financial affairs of each of the Company, BWAY and the
Subsidiaries as they shall have heretofore reasonably requested from the
Company.
All such documents, opinions, certificates, letters, schedules or
instruments delivered pursuant to this Agreement will comply with the provisions
hereof only if they are reasonably satisfactory in all material respects to the
Initial Purchaser and counsel for the Initial Purchaser. The Company shall
furnish to the Initial Purchaser such conformed copies of such documents,
opinions, certificates, letters, schedules and instruments in such quantities as
the Initial Purchaser shall reasonably request.
8. Offering of Notes; Restrictions on Transfer. (a) The Initial
Purchaser represents and warrants that it is a qualified institutional buyer (as
defined in Rule 144A under the Act, a "QIB"). The Initial Purchaser agrees with
the Company (as to itself only) that (i) it has not and will not solicit offers
for, or offer or sell, the Notes by any form of general solicitation or general
advertising (as those terms are used in Regulation D under the Act) or in any
manner involving a public offering within the meaning of Section 4(2) of the
Act; and (ii) it has and will solicit offers for the Notes only from, and will
offer the Notes only to (A) in the case of offers inside the United States,
persons whom the Initial Purchaser reasonably believes to be QIBs or, if any
such person is buying for one or more institutional accounts for which such
person is acting as fiduciary or agent, only when such person has represented to
the Initial Purchaser that each such account is a QIB, to whom notice has been
given that such sale or delivery is being made in reliance on Rule 144A, and, in
each case, in transactions under Rule 144A and (B) in the case of offers outside
the United States, to persons other than U.S. persons ("foreign purchasers,"
which term shall include dealers or other professional fiduciaries in the United
States acting on a discretionary basis for foreign beneficial owners (other than
an estate or trust)); provided, however, that, in the case of this clause (B),
in purchasing such Notes such persons are deemed to have represented and agreed
as provided under the caption "Transfer Restrictions" contained in the
-18-
Final Memorandum (or, if the Final Memorandum is not in existence, in the most
recent Memorandum).
(b) The Initial Purchaser represents and warrants with respect to
offers and sales outside the United States that (i) it has and will comply with
all applicable laws and regulations in each jurisdiction in which it acquires,
offers, sells or delivers Notes or has in its possession or distributes any
Memorandum or any such other material, in all cases at its own expense; (ii) the
Notes have not been and will not be offered or sold within the United States or
to, or for the account or benefit of, U.S. persons except in accordance with
Regulation S under the Act or pursuant to an exemption from the registration
requirements of the Act; (iii) it has offered the Notes and will offer and sell
the Notes (A) as part of its distribution at any time and (B) otherwise until 40
days after the later of the commencement of the offering and the Closing Date,
only in accordance with Rule 903 of Regulation S and, accordingly, neither it
nor any persons acting on its behalf have engaged or will engage in any directed
selling efforts (within the meaning of Regulation S) with respect to the Notes,
and any such persons have complied and will comply with the offering
restrictions requirement of Regulation S; and (iv) it agrees that, at or prior
to confirmation of sales of the Notes, it will have sent to each distributor,
dealer or person receiving a selling concession, fee or other remuneration that
purchases Notes from it during the restricted period a confirmation or notice to
substantially the following effect:
"The Securities covered hereby have not been registered under the
United States Securities Act of 1933 (the "Securities Act") and
may not be offered and sold within the United States or to, or
for the account or benefit of, U.S. persons (i) as part of the
distribution of the Securities at any time or (ii) otherwise
until 40 days after the later of the commencement of the offering
and the closing date of the offering, except in either case in
accordance with Regulation S (or Rule 144A if available) under
the Securities Act. Terms used above have the meaning given to
them in Regulation S."
Terms used in this Section 8 and not defined in this Agreement have
the meanings given to them in Regulation S.
(c) The Initial Purchaser will deliver to each purchaser of Notes from
such Initial Purchaser, in connection with its original distribution of Notes, a
copy of the Final Memorandum.
9. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless the Initial Purchaser, and each person, if any, who
controls the Initial Purchaser within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, against any losses, claims, damages or
liabilities to which the Initial Purchaser or such controlling person may become
subject under the Act, the Exchange Act or otherwise, insofar as any such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon:
(i) any untrue statement or alleged untrue statement made by the
Company in Section 2 hereof;
-19-
(ii) any untrue statement or alleged untrue statement of any
material fact contained in any Memorandum or any amendment or
supplement thereto; or
(iii) the omission or alleged omission to state, in any
Memorandum or any amendment or supplement thereto, a material fact
required to be stated therein or necessary to make the statements
therein not misleading,
and will reimburse, as incurred, the Initial Purchaser and each such controlling
person for any legal or other expenses incurred by the Initial Purchaser or such
controlling person in connection with investigating, defending against or
appearing as a third-party witness in connection with any such loss, claim,
damage, liability or action; provided, however, the Company will not be liable
in any such case to the extent that any such loss, claim, damage, or liability
arises out of or is based upon any untrue statement or alleged untrue statement
or omission or alleged omission (i) made in any Memorandum or any amendment or
supplement thereto in reliance upon and in conformity with written information
concerning the Initial Purchaser furnished to the Company by the Initial
Purchaser specifically for use therein or (ii) (x) if it is established in the
related proceeding that the Initial Purchaser failed to send or deliver a copy
of the Final Memorandum as then amended or supplemented to the person asserting
such loss, claim, damage, or liability prior to the written confirmation of such
sale (provided that the Company has complied with its obligations under Section
5(d) hereof), and (y) the untrue statement or alleged untrue statement or
omission or alleged omission was completely corrected in the Final Memorandum as
then amended or supplemented and the Final Memorandum as then amended or
supplemented does not contain any other untrue statement or alleged untrue
statement or omission or alleged omission that was the subject matter of the
related proceeding. The indemnity provided for in this Section 9 will be in
addition to any liability that the Company may otherwise have to the indemnified
parties. The Company shall not be liable under this Section 9 for any settlement
of any claim or action effected without its prior written consent, which shall
not be unreasonably withheld. The Initial Purchaser shall not, without the prior
written consent of the Company, effect any settlement or compromise of any
pending or threatened proceeding in respect of which the Company is or could
have been a party, or indemnity could have been sought hereunder by the Company,
unless such settlement (A) includes an unconditional written release of the
Company, in form and substance reasonably satisfactory to the Company, from all
liability on claims that are the subject matter of such proceeding and (B) does
not include any statement as to an admission of fault, culpability or failure to
act by or on behalf of the Company.
(b) The Initial Purchaser agrees to indemnify and hold harmless the
Company, its directors, its officers and each person, if any, who controls the
Company within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act against any losses, claims, damages or liabilities to which the
Company or any such director, officer or controlling person may become subject
under the Act, the Exchange Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon (i) any untrue statement or alleged untrue statement of any material fact
contained in any Memorandum or any amendment or supplement thereto, or (ii) the
omission or the alleged omission to state therein a material fact required to be
stated in any Memorandum or any amendment or supplement thereto, or necessary
-20-
to make the statements therein not misleading, in each case to the extent, but
only to the extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made in reliance upon and in conformity with
written information concerning the Initial Purchaser, furnished to the Company
by the Initial Purchaser specifically for use therein; and subject to the
limitation set forth immediately preceding this clause, will reimburse, as
incurred, any legal or other expenses incurred by the Company or any such
director, officer or controlling person in connection with investigating or
defending against or appearing as a third party witness in connection with any
such loss, claim, damage, liability or action in respect thereof. This indemnity
agreement will be in addition to any liability that the Initial Purchaser may
otherwise have to the indemnified parties. The Initial Purchaser shall not be
liable under this Section 9 for any settlement of any claim or action effected
without its consent, which shall not be unreasonably withheld. The Company shall
not, without the prior written consent of the Initial Purchaser, effect any
settlement or compromise of any pending or threatened proceeding in respect of
which the Initial Purchaser is or could have been a party, or indemnity could
have been sought hereunder by the Initial Purchaser, unless such settlement (A)
includes an unconditional written release of the Initial Purchaser, in form and
substance reasonably satisfactory to the Initial Purchaser, from all liability
on claims that are the subject matter of such proceeding and (B) does not
include any statement as to an admission of fault, culpability or failure to act
by or on behalf of the Initial Purchaser.
(c) Promptly after receipt by an indemnified party under this Section
9 of notice of the commencement of any action for which such indemnified party
is entitled to indemnification under this Section 9, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 9, notify the indemnifying party of the commencement thereof
in writing; but the omission to so notify the indemnifying party (i) will not
relieve it from any liability under paragraph (a) or (b) above unless and to the
extent such failure results in the forfeiture by the indemnifying party of
substantial rights and defenses and (ii) will not, in any event, relieve the
indemnifying party from any obligations under this Agreement to any indemnified
party other than the indemnification obligation provided in paragraphs (a) and
(b) above. In case any such action is brought against any indemnified party, and
it notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein and, to the extent that it may
wish, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel reasonably satisfactory to such indemnified
party; provided, however, that if (i) the use of counsel chosen by the
indemnifying party to represent the indemnified party would present such counsel
with a conflict of interest, (ii) the defendants in any such action include both
the indemnified party and the indemnifying party and the indemnified party shall
have been advised by counsel that there may be one or more legal defenses
available to it and/or other indemnified parties that are different from or
additional to those available to the indemnifying party, or (iii) the
indemnifying party shall not have employed counsel reasonably satisfactory to
the indemnified party to represent the indemnified party within a reasonable
time after receipt by the indemnifying party of notice of the institution of
such action, then, in each such case, the indemnifying party shall not have the
right to direct the defense of such action on behalf of such indemnified
-21-
party or parties and such indemnified party or parties shall have the right to
select separate counsel to defend such action on behalf of such indemnified
party or parties. After notice from the indemnifying party to such indemnified
party of its election so to assume the defense thereof and approval by such
indemnified party of counsel appointed to defend such action, the indemnifying
party will not be liable to such indemnified party under this Section 9 for any
legal or other expenses, other than reasonable costs of investigation,
subsequently incurred by such indemnified party in connection with the defense
thereof, unless (i) the indemnified party shall have employed separate counsel
in accordance with the proviso to the immediately preceding sentence (it being
understood, however, that in connection with such action the indemnifying party
shall not be liable for the expenses of more than one separate counsel (in
addition to local counsel) in any one action or separate but substantially
similar actions in the same jurisdiction arising out of the same general
allegations or circumstances, designated by the Initial Purchaser in the case of
paragraph (a) of this Section 9 or the Company in the case of paragraph (b) of
this Section 9, representing the indemnified parties under such paragraph (a) or
paragraph (b), as the case may be, who are parties to such action or actions) or
(ii) the indemnifying party has authorized in writing the employment of counsel
for the indemnified party at the expense of the indemnifying party. All fees and
expenses reimbursed pursuant to this paragraph (c) shall be reimbursed as they
are incurred. After such notice from the indemnifying party to such indemnified
party, the indemnifying party will not be liable for the costs and expenses of
any settlement of such action effected by such indemnified party without the
prior written consent of the indemnifying party (which consent shall not be
unreasonably withheld), unless such indemnified party waived in writing its
rights under this Section 9, in which case the indemnified party may effect such
a settlement without such consent.
(d) In circumstances in which the indemnity agreement provided for in
the preceding paragraphs of this Section 9 is unavailable to, or insufficient to
hold harmless, an indemnified party in respect of any losses, claims, damages or
liabilities (or actions in respect thereof), each indemnifying party, in order
to provide for just and equitable contribution, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages or liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect (i) the relative benefits received by the indemnifying
party or parties on the one hand and the indemnified party on the other from the
offering of the Notes or (ii) if the allocation provided by the foregoing clause
(i) is not permitted by applicable law, not only such relative benefits but also
the relative fault of the indemnifying party or parties on the one hand and the
indemnified party on the other in connection with the statements or omissions or
alleged statements or omissions that resulted in such losses, claims, damages or
liabilities (or actions in respect thereof). The relative benefits received by
the Company on the one hand and the Initial Purchaser on the other shall be
deemed to be in the same proportion as the total proceeds from the offering
(before deducting expenses) received by the Company bear to the total discounts
and commissions received by such Initial Purchaser. The relative fault of the
parties shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company
on the one hand, or the Initial Purchaser on the other, the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission or alleged statement or omission, and any other
equitable considerations appropriate in the circumstances. The Company and the
Initial Purchaser agree that it would not be equitable if the amount of such
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contribution were determined by pro rata or per capita allocation or by any
other method of allocation that does not take into account the equitable
considerations referred to in the first sentence of this paragraph (d).
Notwithstanding any other provision of this paragraph (d), the Initial Purchaser
shall not be obligated to make contributions hereunder that in the aggregate
exceed the total discounts, commissions and other compensation received by the
Initial Purchaser under this Agreement, less the aggregate amount of any damages
that the Initial Purchaser has otherwise been required to pay by reason of the
untrue or alleged untrue statements or the omissions or alleged omissions to
state a material fact, and no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this paragraph (d), each person, if any, who
controls the Initial Purchaser within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act shall have the same rights to contribution as the
Initial Purchaser, and each director of the Company, each officer of the Company
and each person, if any, who controls the Company within the meaning of Section
15 of the Act or Section 20 of the Exchange Act, shall have the same rights to
contribution as the Company.
10. Survival Clause. The respective representations, warranties,
agreements, covenants, indemnities and other statements made pursuant to this
Agreement or contained in the certificates of the Company, submitted hereto,
shall remain in full force and effect, regardless of (i) any investigation made
by or on behalf of the Company, any of its officers or directors, the Initial
Purchaser or any controlling person referred to in Section 9 hereof and (ii)
delivery of and payment for the Notes. The respective agreements, covenants,
indemnities and other statements set forth in Sections 6, 9 and 15 hereof shall
remain in full force and effect, regardless of any termination or cancellation
of this Agreement.
11. Termination. (a) This Agreement may be terminated in the sole
discretion of the Initial Purchaser by notice to the Company given prior to the
Closing Date in the event that the Company shall have failed, refused or been
unable to perform all obligations and satisfy all conditions on its part to be
performed or satisfied hereunder at or prior thereto or, if at or prior to the
Closing Date:
(i) any of BWAY or the Subsidiaries shall have sustained any loss
or interference with respect to its businesses or properties from
fire, flood, hurricane, accident or other calamity, whether or not
covered by insurance, or from any strike, labor dispute, slow down or
work stoppage or any legal or governmental proceeding, which loss or
interference, in the sole judgment of the Initial Purchaser, has had
or has a Material Adverse Effect, or there shall have been, in the
sole judgment of the Initial Purchaser, any event or development that,
individually or in the aggregate, has or could be reasonably likely to
have a Material Adverse Effect (including without limitation a change
in control of BWAY or the Subsidiaries), except in each case as
described in the Final Memorandum (exclusive of any amendment or
supplement thereto) which makes it impracticable or inadvisable to
proceed with the offering and the delivery of the Notes as
contemplated by the Final Memorandum;
-23-
(ii) trading in securities of BWAY or in securities generally on
the New York Stock Exchange, American Stock Exchange or the NASDAQ
National Market shall have been suspended or minimum or maximum prices
shall have been established on any such exchange or market;
(iii) a banking moratorium shall have been declared by New York
or United States authorities or a material disruption in securities
settlement or clearance services in the United States;
(iv) there shall have been (A) an outbreak or escalation of
hostilities between the United States and any foreign power, or (B) an
outbreak or escalation of any other insurrection or armed conflict
involving the United States or any other national or international
calamity or emergency, or (C) any material change in the financial
markets of the United States which, in the case of (A), (B) or (C)
above and in the sole judgment of the Initial Purchaser, makes it
impracticable or inadvisable to proceed with the offering or the
delivery of the Notes as contemplated by the Final Memorandum; or
(v) any securities of BWAY shall have been downgraded or placed
on any "watch list" for possible downgrading by any nationally
recognized statistical rating organization.
(b) Termination of this Agreement pursuant to this Section 11 shall be
without liability of any party to any other party except as provided in Section
10 hereof.
12. Information Supplied by the Initial Purchaser. The statements set
forth in the second sentence of the third paragraph, third sentence of the fifth
paragraph, the sixth paragraph and the seventh paragraph under the heading
"Private Placement" in the Final Memorandum (to the extent such statements
relate to the Initial Purchaser) constitute the only information furnished by
the Initial Purchaser to the Company for the purposes of Sections 2(a) and 9
hereof.
13. Notices. All communications hereunder shall be in writing and, if
sent to the Initial Purchaser, shall be mailed or delivered to Deutsche Bank
Securities Inc., ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
Corporate Finance Department, with a copy to ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.; if sent to
the Company, shall be mailed or delivered to the Company at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇▇▇▇; with a copy to
Debevoise & ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
All such notices and communications shall be deemed to have been duly
given: when delivered by hand, if personally delivered; five business days after
being deposited in the mail, postage prepaid, if mailed; and one business day
after being timely delivered to a next-day air courier.
-24-
14. Successors. This Agreement shall inure to the benefit of and be
binding upon the Initial Purchaser, the Company and their respective successors
and legal representatives, and nothing expressed or mentioned in this Agreement
is intended or shall be construed to give any other person any legal or
equitable right, remedy or claim under or in respect of this Agreement, or any
provisions herein contained; this Agreement and all conditions and provisions
hereof being intended to be and being for the sole and exclusive benefit of such
persons and for the benefit of no other person except that (i) the indemnities
of the Company contained in Section 9 of this Agreement shall also be for the
benefit of any person or persons who control the Initial Purchaser within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act and (ii) the
indemnities of the Initial Purchaser contained in Section 9 of this Agreement
shall also be for the benefit of the directors of the Company, its officers and
any person or persons who control the Company within the meaning of Section 15
of the Act or Section 20 of the Exchange Act. No purchaser of Notes from the
Initial Purchaser will be deemed a successor because of such purchase.
15. APPLICABLE LAW. THE VALIDITY AND INTERPRETATION OF THIS AGREEMENT,
AND THE TERMS AND CONDITIONS SET FORTH HEREIN SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS
MADE AND TO BE PERFORMED WHOLLY THEREIN, WITHOUT GIVING EFFECT TO ANY PROVISIONS
THEREOF RELATING TO CONFLICTS OF LAW.
16. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
-25-
If the foregoing correctly sets forth our understanding, please
indicate your acceptance thereof in the space provided below for that purpose,
whereupon this letter shall constitute a binding agreement between the Company
and the Initial Purchaser.
Very truly yours,
BWAY FINANCE CORP.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇
--------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇
Title: Vice President
The foregoing Agreement is hereby confirmed and accepted as of the date
first above written.
DEUTSCHE BANK SECURITIES INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇
--------------------------
Name: ▇▇▇▇ ▇▇▇▇▇
Title: Managing Director
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
-26-
SCHEDULE 1
Principal
Initial Purchaser Amount of Notes
----------------- ---------------
Deutsche Bank Securities Inc. ....................... $ 200,000,000
SCHEDULE 2
Direct and Indirect Subsidiaries of BWAY
Name Jurisdiction of Incorporation
---- -----------------------------
▇▇▇▇▇▇▇▇▇ Containers, Inc. Delaware
BWAY Manufacturing, Inc. Delaware