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▇▇▇▇-▇▇▇▇▇ STORES, INC.
(a Florida corporation)
8 7/8% Senior Notes Due 2008
PURCHASE AGREEMENT
Dated: March 22, 2001
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TABLE OF CONTENTS
PURCHASE AGREEMENT...............................................................1
SECTION 1. Representations and Warranties........................................3
(a) Representations and Warranties by the Company...........................3
(i) Compliance with Registration Requirements...............................3
(ii) Incorporated Documents..................................................4
(iii) Independent Accountants.................................................4
(iv) Financial Statements....................................................4
(v) No Material Adverse Change in Business..................................5
(vi) Good Standing of the Company............................................5
(vii) Good Standing of Subsidiaries...........................................5
(viii) Capitalization..........................................................6
(ix) Authorization of Agreement..............................................6
(x) Authorization of the Indenture..........................................6
(xi) Authorization of the Securities and the Guarantees......................7
(xii) Authorization of New Credit Facility....................................7
(xiii) Description of the Securities and the Indenture.........................7
(xiv) Absence of Defaults and Conflicts.......................................7
(xv) Absence of Labor Dispute................................................8
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(xvi) Absence of Proceedings...................................................8
(xvii) Accuracy of Exhibits.....................................................8
(xviii) Possession of Intellectual Property......................................9
(xix) Absence of Further Requirements..........................................9
(xx) Possession of Licenses and Permits.......................................9
(xxi) Title to Property.......................................................10
(xxii) Investment Company Act..................................................10
(xxiii) Environmental Laws......................................................10
(xxiv) Restructuring Plan......................................................11
(xxv) Tax Returns.............................................................11
(xxvi) Insurance...............................................................11
(xxvii) Solvency................................................................11
(xxviii) Related Party Transactions..............................................11
(xxix) Accounting Controls.....................................................11
(xxx) Stabilization or Manipulation...........................................12
(b) Officer's Certificates..................................................12
SECTION 2. Sale and Delivery to Underwriters; Closing............................12
(a) Securities and Guarantees...............................................12
(b) Payment.................................................................12
(c) Registration............................................................13
(d) Appointment of Qualified Independent Underwriter........................13
SECTION 3. Covenants of the Company and the Guarantors...........................13
(a) Compliance with Securities Regulations and Commission Requests..........13
(b) Filing of Amendments....................................................14
(c) Delivery of Registration Statements.....................................14
(d) Delivery of Prospectuses................................................14
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(e) Continued Compliance with Securities Laws..............................14
(f) Blue Sky Qualifications................................................15
(g) Rule 158...............................................................15
(h) Use of Proceeds........................................................15
(i) Restriction on Sale of Securities......................................15
(j) Reporting Requirements.................................................16
(k) Rating of Securities...................................................16
(l) DTC Clearance..........................................................16
SECTION 4. Payment of Expenses..................................................16
(a) Expenses...............................................................16
(b) Termination of Agreement...............................................16
SECTION 5. Conditions of Underwriters' Obligations..............................16
(a) Effectiveness of Registration Statement................................17
(b) Opinion of Counsel for Company.........................................17
(c) Opinion of Counsel for Underwriters....................................17
(d) Officers' Certificate..................................................17
(e) Accountant's Comfort Letter............................................18
(f) Bring-down Comfort Letter..............................................18
(g) Maintenance of Rating..................................................18
(h) New Credit Facility....................................................18
(i) Additional Documents...................................................18
(j) Termination Agreement..................................................19
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SECTION 6. Indemnification......................................................19
(a) Indemnification of Underwriters........................................19
(b) Indemnification of Company, Guarantors, Directors and Officers.........20
(c) Actions against Parties; Notification..................................21
(d) Settlement without Consent if Failure to Reimburse.....................21
SECTION 7. Contribution.........................................................22
SECTION 8. Representations, Warranties and Agreements to Survive Delivery.......23
SECTION 9. Termination of Agreement.............................................23
(a) Termination; General...................................................23
(b) Liabilities............................................................24
SECTION 10. Default by One or More of the Underwriters..........................24
SECTION 11. Notices.............................................................25
SECTION 12. Parties.............................................................25
SECTION 13. Governing Law and Time..............................................25
SECTION 14. Effect of Headings..................................................25
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SCHEDULES
Schedule A - List of Underwriters.........................................Sch A-1
Schedule B - Pricing Information..........................................Sch B-1
Schedule C - List of Guarantors...........................................Sch C-1
Schedule D - List of Subsidiaries.........................................Sch D-1
EXHIBITS
Exhibit A-1 - Form of Opinion of LeBoeuf, Lamb, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, L.L.P.........A-1
Exhibit A-2 - Form of Opinion of E. ▇▇▇▇▇ ▇▇▇▇▇, Jr. ..........................A-2
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▇▇▇▇-▇▇▇▇▇ STORES, INC.
(a Florida corporation)
$300,000,000
8 7/8% Senior Notes due 2008
PURCHASE AGREEMENT
March 22, 2001
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
First Union Securities, Inc.
BMO ▇▇▇▇▇▇▇ ▇▇▇▇▇ Corp.
CIBC World Markets Corp.
Credit Lyonnais Securities (USA) Inc.
Fleet Securities, Inc.
SunTrust Equitable Securities Corp.
as Representatives of the several Underwriters
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Ladies and Gentlemen:
▇▇▇▇-▇▇▇▇▇ Stores, Inc., a Florida corporation (the "Company"), and
each of the Guarantors listed on Schedule B hereto (the "Guarantors"), confirm
their respective agreements with ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce,
▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated ("▇▇▇▇▇▇▇ ▇▇▇▇▇") and each of the other Underwriters
named in Schedule A hereto (collectively, the "Underwriters," which term shall
also include any underwriter substituted as hereinafter provided in Section 10
hereof), for whom ▇▇▇▇▇▇▇ ▇▇▇▇▇, First Union Securities, Inc. ("First Union"),
BMO ▇▇▇▇▇▇▇ ▇▇▇▇▇ Corp., Fleet Securities, Inc., SunTrust Equitable Securities
Corp. and CIBC World Markets Corp. are acting as representatives (in such
capacity, the "Representatives"), with respect to (i) the issue and sale by the
Company and the purchase by the Underwriters, acting severally and not jointly,
of the respective principal amounts set forth in said Schedule A of
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$300,000,000 aggregate principal amount of the Company's 8 7/8% Senior Notes due
2008 (the "Securities") and (ii) the issue and sale by the Guarantors and the
purchase by the Underwriters, acting severally and not jointly, of the senior
guarantees (the "Guarantees") of the Company's obligations under the Securities.
The Securities and the Guarantees are to be issued pursuant to an indenture
dated as of December 26, 2000 (the "Base Indenture") between the Company, the
Guarantors and Wilmington Trust Company, as trustee (the "Trustee"), as
supplemented by the First Supplemental Indenture, to be dated as of March 29,
2001, among the Company, the Guarantors and the Trustee (the "First Supplemental
Indenture"), establishing the form and terms of the Securities (collectively
with the Base Indenture, the "Indenture").
The Company understands that the Underwriters propose to make a public offering
of the Securities and the Guarantees as soon as the Representatives deem
advisable after this Agreement has been executed and delivered.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-52874) covering the
registration of the Securities and the Guarantees under the Securities Act of
1933, as amended (the "1933 Act"), and the offering thereof from time to time in
accordance with Rule 415 of the rules and regulations of the Commission under
the 1933 Act (the "1933 Act Regulations"). Such registration statement has been
declared effective by the Commission and the Indenture has been duly qualified
under the Trust Indenture Act of 1939, as amended (the "1939 Act"). Promptly
after execution and delivery of this Agreement, the Company will either (i)
prepare and file a final prospectus and final prospectus supplement in
accordance with the provisions of paragraph (b) of Rule 424 of the rules and
regulations of the Commission or (ii) if the Company has elected to rely upon
Rule 434 of the 1933 Act Regulations, prepare and file a term sheet or
abbreviated term sheet (the "Term Sheet") in accordance with the provisions of
Rule 434 and Rule 424(b). The aforementioned registration statement (as amended
from time to time and including the registration statement on Form S-3 (No.
333-50496) the Securities under which are included in the combined prospectus
pursuant to Rule 429 of the 1933 Act Regulations), including the exhibits
thereto, schedules thereto, if any, and the documents incorporated by reference
therein, including the information, if any, deemed to be a part thereof pursuant
to Rule 430A of the 1933 Act Regulations (the "Rule 430A Information") or Rule
434 of the 1933 Act Regulations (the "Rule 434 Information"), is referred to
herein as the "Registration Statement;" and the final prospectus and the final
prospectus supplement relating to the offering of the Securities and the
Guarantees, in the form furnished to the Underwriters by the Company for use in
connection with the offering of the Securities and the Guarantees, are
collectively referred to herein as the "Prospectus;" provided, however, that all
references to the "Registration Statement" and the "Prospectus" shall also be
deemed to include all documents incorporated therein by reference pursuant to
the Securities Exchange Act of 1934, as amended (the "1934 Act"), prior to the
execution of this Agreement. Any registration statement filed pursuant to Rule
462(b) of the 1933 Act Regulations is herein referred to as the "Rule 462(b)
Registration Statement," and after such filing the term "Registration Statement"
shall include the Rule 462(b) Registration Statement. If the Company elects to
rely upon Rule 434 of the 1933 Act Regulations, then all references to the
"Prospectus" shall also be deemed to include the final or preliminary prospectus
and the applicable Term Sheet in the form first
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furnished to the Underwriters by the Company in reliance upon Rule 434 of the
1933 Act Regulations, and all references in this Agreement to the date of the
Prospectus shall mean the date of the Term Sheet. A "preliminary prospectus"
shall be deemed to refer to any prospectus and any amendment or supplement
thereto that omitted, as applicable, the Rule 430A Information, the Rule 434
Information or other information to be included upon pricing in a form of
prospectus filed with the Commission pursuant to Rule 424(b) of the 1933 Act
Regulations and was used after the effectiveness of the Registration Statement
and prior to the execution and delivery of this Agreement. For purposes of this
Agreement, all references to the Registration Statement, any preliminary
prospectus, the Prospectus or any Term Sheet or any amendment or supplement to
any of the foregoing shall be deemed to include any copy filed with the
Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval
system ("▇▇▇▇▇").
All references in this Agreement to financial statements and schedules
and other information which is "contained," "included" or "stated" (or other
references of like import) in the Registration Statement, any preliminary
prospectus or the Prospectus or any amendment or supplement thereto shall be
deemed to mean and include all such financial statements and schedules and other
information which is incorporated by reference in the Registration Statement,
any preliminary prospectus or the Prospectus or any amendment or supplement
thereto, as the case may be; and all references in this Agreement to amendments
or supplements to the Registration Statement, any preliminary prospectus or the
Prospectus shall be deemed to mean and include the filing of any document under
the 1934 Act which is incorporated by reference in the Registration Statement,
such preliminary prospectus or the Prospectus, as the case may be.
Simultaneously with the closing of the issuance of the Securities and
Guarantees, the Company will enter into a new $800 million Senior Secured Credit
Facility with First Union and ▇▇▇▇▇▇▇ ▇▇▇▇▇ as Joint Lead Arrangers in the form
previously delivered to the Underwriters and substantially as described in the
Prospectus (the "New Credit Facility").
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company and the Guarantors. The
Company and each of the Guarantors, jointly and severally, represent and warrant
to each Underwriter as of the date hereof and as of the Closing Time referred to
in Section 2(b) hereof, and agree with each Underwriter, as follows:
(i) Compliance with Registration Requirements. The Company meets the
requirements for use of Form S-3 under the 1933 Act. Each of the Registration
Statement and any Rule 462(b) Registration Statement has become effective under
the 1933 Act and no stop order suspending the effectiveness of the Registration
Statement or any Rule 462(b) Registration Statement has been issued under the
1933 Act and no proceedings for that purpose have been instituted or are pending
or, to the knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for additional information has been
complied with. The
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Indenture has been qualified under the Trust Indenture Act of 1939, as amended
(the "1939 Act"). All of the Guarantors are registrants under the Registration
Statement.
At the respective times the Registration Statement, any Rule 462(b) Registration
Statement and any post-effective amendments thereto became effective and at the
Closing Time, the Registration Statement, the Rule 462(b) Registration Statement
and any amendments and supplements thereto complied and will comply in all
material respects with the requirements of the 1933 Act and the 1933 Act
Regulations and the 1939 Act and the rules and regulations of the Commission
under the 1939 Act (the "1939 Act Regulations"), and did not and will not
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading. Neither the Prospectus nor any amendments or supplements thereto, at
the time the Prospectus or any such amendment or supplement was issued and at
the Closing Time, included or will include an untrue statement of a material
fact or omitted or will 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. If Rule 434 is used, the Company will comply with the
requirements of Rule 434. The representations and warranties in this subsection
shall not apply to statements in or omissions from the Registration Statement or
Prospectus made in reliance upon and in conformity with information furnished to
the Company in writing by any Underwriter through ▇▇▇▇▇▇▇ ▇▇▇▇▇ expressly for
use in the Registration Statement or Prospectus.
Each preliminary prospectus and the prospectus filed as part of the Registration
Statement as originally filed or as part of any amendment thereto, or filed
pursuant to Rule 424 under the 1933 Act, complied when so filed in all material
respects with the 1933 Act Regulations and each preliminary prospectus and the
Prospectus delivered to the Underwriters for use in connection with this
offering was identical to the electronically transmitted copies thereof filed
with the Commission pursuant to ▇▇▇▇▇, except to the extent permitted by
Regulation S-T.
(ii) Incorporated Documents. The documents incorporated or deemed to be
incorporated by reference in the Registration Statement and the Prospectus, at
the time they were or hereafter are filed with the Commission, complied and will
comply in all material respects with the requirements of the 1934 Act and the
rules and regulations of the Commission thereunder (the "1934 Act Regulations"),
and, when read together with the other information in the Prospectus, at the
time the Registration Statement became effective, at the time the Prospectus was
issued and at the Closing Time, did not and will not contain an untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading.
(iii) Independent Accountants. The accountants who certified the financial
statements and supporting schedules included in the Registration Statement are
independent public accountants as required by the 1933 Act, the 1933 Act
Regulations, the 1934 Act and the 1934 Act Regulations.
(iv) Financial Statements. The financial statements included in the Registration
Statement and the Prospectus, together with the related schedules and notes,
present fairly the financial
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position of the Company and its consolidated Subsidiaries at the dates indicated
and the statement of operations, stockholders' equity and cash flows of the
Company and its consolidated Subsidiaries for the periods specified; said
financial statements have been prepared in conformity with generally accepted
accounting principles ("GAAP") applied on a consistent basis throughout the
periods involved. The supporting schedules, if any, included in the Registration
Statement present fairly in accordance with GAAP the information required to be
stated therein. The selected financial data and the summary financial
information included in the Prospectus present fairly the information shown
therein and have been compiled on a basis consistent with that of the audited
financial statements included in the Registration Statement. The adjusted
financial information included in the Registration Statement and the Prospectus
present fairly the information included therein, have been properly compiled 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. There are no
historical or pro forma financial statements which are required by the 1933 Act,
the 1933 Act Regulations and Regulation S-X to be included in the Registration
Statement and the Prospectus which are not included as required.
(v) No Material Adverse Change in Business. Since the respective dates as of
which information is given in the Registration Statement and the Prospectus,
except as otherwise stated therein, (A) there has been no material adverse
change in the condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company and its Subsidiaries considered as
one enterprise, whether or not arising in the ordinary course of business (a
"Material Adverse Effect"), (B) there have been no transactions entered into by
the Company or any of its Subsidiaries, other than those in the ordinary course
of business, which are material with respect to the Company and its Subsidiaries
considered as one enterprise and (C) except for regular quarterly dividends on
the common stock, par value 1.00 per share, of the Company (the "Common Stock")
in amounts per share that are consistent with past practice, there has been no
dividend or distribution of any kind declared, paid or made by the Company on
any class of its capital stock.
(vi) Good Standing of the Company. The Company has been duly organized and is
validly existing as a corporation in good standing under the laws of the State
of Florida and has 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 this Agreement; and the Company is
duly qualified as a foreign corporation to transact business and is in good
standing 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 where the failure so to qualify or to be in good standing would
not result in a Material Adverse Effect.
(vii) Good Standing of Subsidiaries. Each subsidiary of the Company (each a
"Subsidiary" and, collectively, the "Subsidiaries") has been duly organized and
is validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has corporate power and authority to own,
lease and operate its properties and to conduct its business as described in the
Prospectus and 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
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of the ownership or leasing of property or the conduct of business, except where
the failure so to qualify or to be in good standing would not result in a
Material Adverse Effect; except as otherwise disclosed in the Registration
Statement and the Prospectus, all of the issued and outstanding capital stock of
each such 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, claim or equity other than the pledge of shares of common stock of
the Guarantors under the New Credit Facility; none of the outstanding shares of
capital stock of any Subsidiary was issued in violation of the preemptive or
similar rights of any securityholder of such Subsidiary. All of the Subsidiaries
of the Company are listed on Schedule D hereto. The Subsidiaries of the Company
which are not Guarantors collectively represented less than 10% of the Company's
consolidated revenue, net income and assets as of or for the period ending
January 10, 2001.
(viii) Capitalization. The authorized, issued and outstanding capital stock of
the Company is as set forth in the Company's financial statements incorporated
by reference in the Registration Statement and Prospectus (except for subsequent
issuances, if any, pursuant to reservations, agreements or employee benefit
plans referred to in the Company's financial statements or pursuant to the
exercise of convertible securities or options referred to in the Company's
financial statements). The shares of issued and outstanding capital stock of the
Company have been duly authorized and validly issued and are fully paid and
non-assessable; none of the outstanding shares of capital stock of the Company
was issued in violation of the preemptive or other similar rights of any
securityholder of the Company.
(ix) Authorization of Agreement. This Agreement has been duly authorized,
executed and delivered by the Company and each of the Guarantors.
(x) Authorization of the Indenture. The Base Indenture has been duly authorized,
executed and delivered by the Company and each of the Guarantors and is duly
qualified under the 1939 Act and constitutes a valid and binding agreement of
the Company and each of the Guarantors, enforceable against the Company and each
of the Guarantors in accordance with its terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency (including, without limitation,
all laws relating to fraudulent transfers), reorganization, moratorium or
similar laws affecting enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity or at law). The
Supplemental Indenture has been duly authorized by the Company and each of the
Guarantors and, when duly executed and delivered by the Company and each of the
Guarantors, will constitute a valid and binding agreement of the Company and
each of the Guarantors, enforceable against the Company and each of the
Guarantors in accordance with its terms, except as the enforcement thereof may
be limited by bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium or similar laws
affecting enforcement of creditors' rights generally and except as enforcement
thereof is subject to general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law).
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(xi) Authorization of the Securities and the Guarantees. The Securities have
been duly authorized and, at the Closing Time, will have been duly executed by
the Company and, when authenticated, issued and delivered in the manner provided
for in the Indenture and delivered against payment of the purchase price
therefor as provided in this Agreement, will constitute valid and binding
obligations of the Company, enforceable against the Company in accordance with
their terms, except as the enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or similar laws affecting enforcement of
creditors' rights generally and except as enforcement thereof is subject to
general principles of equity (regardless of whether enforcement is considered in
a proceeding in equity or at law), and will be in the form contemplated by, and
entitled to the benefits of, the Indenture. The Guarantees have been duly
authorized by the Guarantors and, when executed and delivered in the manner
provided for in the Indenture, will constitute valid and binding obligations of
the Guarantors, enforceable against the Guarantors in accordance with their
terms, except as the enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or similar laws affecting enforcement of
creditors' rights generally and except as enforcement thereof is subject to
general principles of equity (regardless of whether enforcement is considered in
a proceeding in equity or at law), and will be in the form contemplated by, and
entitled to the benefits of, the Indenture.
(xii) Authorization of New Credit Facility. The New Credit Facility has been
duly authorized by the Company and each of the Guarantors and, when duly
executed and delivered by the Company and each of the Guarantors, will
constitute a valid and binding agreement of the Company and each of the
Guarantors, enforceable against the Company and each of the Guarantors in
accordance with its terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or similar laws affecting
enforcement of creditors' rights generally and except as enforcement thereof is
subject to general principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law).
(xiii) Description of the Securities, the Guarantees, the Indenture and the New
Credit Facility. The Securities, the Guarantees, the Indenture and the New
Credit Facility will conform in all material respects to the respective
statements relating thereto contained in the Prospectus.
(xiv) Absence of Defaults and Conflicts. Neither the Company nor any of its
Subsidiaries is in violation of its charter or by-laws or in default in the
performance or observance of any obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, deed of trust, loan or credit
agreement, note, lease or other agreement or 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 Subsidiary is
subject (collectively, "Agreements and Instruments") except for such defaults
that would not result in a Material Adverse Effect; and the execution, delivery
and performance of this Agreement, the Indenture, the New Credit Facility, the
Securities, the Guarantees and any other agreement or instrument entered into or
issued or to be entered into or issued by the Company or any of the Guarantors
in connection with the consummation of the transactions contemplated herein and
in the
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Registration Statement and the Prospectus (including the issuance and sale of
the Securities and the Guarantees and the use of the proceeds from the sale of
the Securities and the Guarantees as described in the Prospectus under the
caption "Use of Proceeds") and compliance by the Company and the Guarantors with
their respective obligations hereunder and under the Indenture, the Securities
and the Guarantees have been duly authorized by all necessary corporate action
and do not and will not, whether with or without the giving of notice or passage
of time or both, conflict with or constitute a breach of, or default or
Repayment 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 Subsidiary pursuant to, the Agreements and Instruments (except
for such conflicts, breaches, defaults, Repayment Events, liens, charges or
encumbrances contemplated by the New Credit Facility or that would not result in
a Material Adverse Effect), nor will such action result in any violation of the
provisions of the charter or by-laws of the Company or any Subsidiary or any
applicable law, statute, rule, regulation, judgment, order, writ or decree of
any government, government instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any Subsidiary or any of their assets,
properties or operations. As used herein, a "Repayment Event" means any event or
condition which gives 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 Subsidiary.
(xv) Absence of Labor Dispute. No labor dispute with the employees of the
Company or any Subsidiary exists or, to the knowledge of the Company and the
Guarantors, is imminent, and the Company and the Guarantors are not aware of any
existing or imminent labor disturbance by the employees of any of its or any
Subsidiary's principal suppliers, manufacturers, customers or contractors,
which, in either case, may reasonably be expected to result in a Material
Adverse Effect.
(xvi) Absence of Proceedings. There is no action, suit, proceeding, inquiry or
investigation before or brought by any court or governmental agency or body,
domestic or foreign, now pending, or, to the knowledge of the Company or any
Guarantor, threatened, against or affecting the Company or any Subsidiary, which
is required to be disclosed in the Registration Statement and the Prospectus
(other than as disclosed therein), or which might reasonably be expected to
result in a Material Adverse Effect, or which might reasonably be expected to
materially and adversely affect the properties or assets of the Company and its
Subsidiaries considered as one enterprise or the consummation of the
transactions contemplated in this Agreement or the performance by the Company
and the Guarantors of their obligations hereunder or under the Indenture,
Securities or the Guarantees; the aggregate of all pending legal or governmental
proceedings to which the Company or any Subsidiary thereof is a party or of
which any of their respective property or assets is the subject which are not
described in the Registration Statement and the Prospectus, including ordinary
routine litigation incidental to the business, would not reasonably be expected
to result in a Material Adverse Effect.
(xvii) Accuracy of Exhibits. There are no contracts or documents which are
required to be described in the Registration Statement, the Prospectus or the
documents incorporated by
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reference therein or to be filed as exhibits thereto which have not been so
described and filed as required.
(xviii) Possession of Intellectual Property. The Company and its Subsidiaries
own or possess, or can acquire on reasonable terms, adequate patents, patent
rights, licenses, inventions, copyrights, know-how (including trade secrets and
other unpatented and/or unpatentable proprietary or confidential information,
systems or procedures), trademarks, service marks, trade names or other
intellectual property (collectively, "Intellectual Property") necessary to carry
on the business now operated by them, and neither the Company nor any of its
Subsidiaries has received any notice or is otherwise aware of any infringement
of or conflict with asserted rights of others with respect to any Intellectual
Property or of any facts or circumstances which would render any Intellectual
Property invalid or inadequate to protect the interest of the Company or any of
its Subsidiaries therein, and which infringement or conflict (if the subject of
any unfavorable decision, ruling or finding) or invalidity or inadequacy, singly
or in the aggregate, would reasonably be expected to result in a Material
Adverse Effect.
(xix) Absence of Further Requirements. No filing with, or authorization,
approval, consent, license, order, registration, qualification or decree of, any
court or governmental authority or agency is necessary or required for the
performance by the Company or any of the Guarantors of their respective
obligations hereunder, in connection with the offering, issuance or sale of the
Securities and the Guarantees hereunder or the consummation of the transactions
contemplated by this Agreement or for the due execution, delivery or performance
by the Company or any of the Guarantors of this Agreement, the Indenture, the
New Credit Facility, the Securities, the Guarantees or any other agreement or
instrument entered into or issued or to be entered into or issued by the Company
or any of the Subsidiaries in connection with the consummation of the
transactions contemplated herein and in the Registration Statement and the
Prospectus (including the issuance and sale of the Securities and the Guarantees
and the use of the proceeds from the sale of the Securities and the Guarantees
as described in the Prospectus under the caption "Use of Proceeds"), except such
as have been already obtained under the 1933 Act or the 1933 Act Regulations or
as may be required under state securities laws.
(xx) Possession of Licenses and Permits. The Company and its Subsidiaries
possess such permits, licenses, approvals, consents and other authorizations
(collectively, "Governmental Licenses") issued by the appropriate federal,
state, local or foreign regulatory agencies or bodies necessary to conduct the
business now operated by them; the Company and its Subsidiaries are in
compliance with the terms and conditions of all such Governmental Licenses,
except where the failure so to comply would not, singly or in the aggregate,
have a Material Adverse Effect; all of the Governmental Licenses are valid and
in full force and effect, except when the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full force and
effect would not have a Material Adverse Effect; and neither the Company nor any
of the Subsidiaries has received any notice of proceedings relating to the
revocation or modification of any such Governmental Licenses which, singly or in
the aggregate, if the subject of an unfavorable decision, ruling or finding,
would reasonably be expected to result in a Material Adverse Effect.
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(xxi) Title to Property. The Company and its Subsidiaries have good and
marketable title to all real property owned by the Company and its Subsidiaries
and good title to all other properties owned by them, in each case, free and
clear of all mortgages, pledges, liens, security interests, claims, restrictions
or encumbrances of any kind except such as (a) are described in the Prospectus
or contemplated by the New Credit Facility or (b) do not, singly or in the
aggregate, materially affect the value of such property and do not interfere
with the use made and proposed to be made of such property by the Company or any
of its Subsidiaries; and all of the leases and subleases material to the
business of the Company and its Subsidiaries, considered as one enterprise, and
under which the Company or any of its Subsidiaries holds properties described in
the Prospectus, are in full force and effect, and neither the Company nor any
Subsidiary has received any notice of any material claim of any sort that has
been asserted by anyone adverse to the rights of the Company or any Subsidiary
under any of the leases or subleases mentioned above, or affecting or
questioning the rights of the Company or such Subsidiary to the continued
possession of the leased or subleased premises under any such lease or sublease,
except as would not, singly or in the aggregate, reasonably be expected to
result in a Material Adverse Effect.
(xxii) Investment Company Act. The Company and each of the Guarantors is not,
and upon the issuance and sale of the Securities and the Guarantees as herein
contemplated and the application of the net proceeds therefrom as described in
the Prospectus will not be, an "investment company" or an entity "controlled" by
an "investment company" as such terms are defined in the Investment Company Act
of 1940, as amended (the "1940 Act").
(xxiii) Environmental Laws. Except as described in the Registration Statement
and the Prospectus and except as would not, singly or in the aggregate, result
in a Material Adverse Effect, (A) neither the Company nor any of its
Subsidiaries is in violation of any federal, state, local or foreign statute,
law, rule, regulation, ordinance, code, policy or rule of common law or any
judicial or administrative interpretation thereof, including any judicial or
administrative order, consent, decree or judgment, relating to pollution or
protection of human health, 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 the
release or threatened release of chemicals, pollutants, contaminants, wastes,
toxic substances, hazardous substances, petroleum or petroleum products
(collectively, "Hazardous Materials") or to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
Hazardous Materials (collectively, "Environmental Laws"), (B) the Company and
its Subsidiaries have all permits, authorizations and approvals required under
any applicable Environmental Laws and are each in compliance with their
requirements, (C) there are no pending or, to the Company's knowledge,
threatened administrative, regulatory or judicial actions, suits, demands,
demand letters, claims, liens, notices of noncompliance or violation,
investigation or proceedings relating to any Environmental Law against the
Company or any of its Subsidiaries and (D) there are no events or circumstances
that might reasonably be expected to form the basis of an order for clean-up or
remediation, or an action, suit or proceeding by any private party or
governmental body or agency, against or affecting the Company or any of its
Subsidiaries relating to Hazardous Materials or any Environmental Laws.
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(xxiv) Restructuring Plan. The description of the Company's restructuring
program in the Prospectus is a fair and accurate summary. The assumptions
underlying the restructuring program calculations in the Prospectus are based on
current and reasonable assumptions derived from the Company's financial records
and other Company financial information.
(xxv) Tax Returns. All United States federal income tax returns of the Company
and its Subsidiaries required by law to be filed have been filed and all taxes
shown by such returns or otherwise assessed, which are due and payable, have
been paid, except assessments against which appeals have been or will be
promptly taken and as to which adequate reserves have been provided. The Company
and its Subsidiaries have filed all other tax returns that are required to have
been filed by them pursuant to applicable foreign, state, local or other law
except insofar as the failure to file such returns would not result in a
Material Adverse Effect, and has paid all taxes due pursuant to such returns or
pursuant to any assessment received by the Company and its Subsidiaries, except
for such taxes, if any, as are being contested in good faith and as to which
adequate reserves have been provided. The charges, accruals and reserves on the
books of the Company in respect of any income and corporation tax liability for
any years not finally determined are adequate to meet any assessments or
re-assessments for additional income tax for any years not finally determined,
except to the extent of any inadequacy that would not result in a Material
Adverse Effect.
(xxvi) Insurance. The Company and its Subsidiaries carry or are entitled to the
benefits of insurance, with financially sound and reputable insurers, in such
amounts and covering such risks as is generally maintained by companies of
established repute engaged in the same or similar business, and all such
insurance is in full force and effect.
(xxvii) Solvency. The Company and each of the Guarantors are, and immediately
after the Closing will be, Solvent. As used herein, the term "Solvent" means,
with respect to the Company and each Guarantor, as the case may be, on a
particular date, that on such date (A) the fair market value of the assets of
the Company or such Guarantor is greater than the total amount of liabilities
(including contingent liabilities) of the Company or such Guarantor, (B) the
present fair salable value of the assets of the Company or such Guarantor is
greater than the amount that will be required to pay the probable liabilities of
the Company or such Guarantor on its debts as they become absolute and mature,
(C) the Company or such Guarantor is able to realize upon its assets and pay its
debts and other liabilities, including contingent obligations, as they mature
and (D) the Company or such Guarantor does not have unreasonably small capital.
(xxviii) Related Party Transactions. No relationship, direct or indirect, exists
between or among any of the Company, the Guarantors or any affiliate of the
Company or any Guarantor, on the one hand, and any director, officer,
stockholder, customer or supplier of any of them, on the other hand, which is
required by the 1933 Act or by the 1933 Act Regulations to be described in the
Registration Statement or the Prospectus which is not so described or is not
described as required.
(xxix) Accounting Controls. The Company and each of its Subsidiaries maintain a
system of internal accounting controls sufficient to provide reasonable
assurances that (A) transactions are
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executed in accordance with management's general or specific authorization, (B)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain accountability for assets, (C) access to assets is permitted only in
accordance with management's general or specific authorization and (D) the
recorded accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(xxx) Stabilization or Manipulation. Neither the Company nor any Guarantor nor
any of their respective officers, directors or controlling persons has taken,
directly or indirectly, any action designed to cause or to result in, or that
has constituted or which might reasonably be expected to constitute, the
stabilization or manipulation of the price of any security of the Company or any
Guarantor in order to facilitate the sale or resale of the Securities or the
guarantees. The Company and the Guarantors have not distributed and prior to the
later to occur of (i) the Closing Time and (ii) completion of the distribution
of the Securities and the Guarantees, will not distribute any offering material
in connection with the offering and sale of the Securities and the Guarantees
other than the Prospectus or other materials, if any, permitted by the 1933 Act
and approved by the Representatives.
(b) Officer's Certificates. Any certificate signed by any officer of the Company
or any of its Subsidiaries delivered to the Representatives or to counsel for
the Underwriters shall be deemed a representation and warranty by the Company or
any of the Subsidiaries to each Underwriter as to the matters covered thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) Securities and Guarantees. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company and the Guarantors agree to sell to each Underwriter,
severally and not jointly, and each Underwriter, severally and not jointly,
agrees to purchase from the Company, at the price set forth in Schedule B, the
aggregate principal amount of Securities (including the Guarantees) set forth in
Schedule A opposite the name of such Underwriter, plus any additional principal
amount of Securities (including the Guarantees) which such Underwriter may
become obligated to purchase pursuant to the provisions of Section 10 hereof.
(b) Payment. Payment of the purchase price for, and delivery of certificates
for, the Securities and the Guarantees shall be made at the offices of ▇▇▇▇▇,
▇▇▇▇▇ & ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or at such other place
as shall be agreed upon by the Representatives, the Company and the Guarantors,
at 9:00 A.M. (Eastern time) on the third (fourth, if the pricing occurs after
4:30 P.M. (Eastern time) on any given day) business day after the date hereof
(unless postponed in accordance with the provisions of Section 10), or such
other time not later than ten business days after such date as shall be agreed
upon by the Representatives, the Company and the Guarantors (such time and date
of payment and delivery being herein called "Closing Time").
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Payment shall be made to the Company and the Guarantors by wire transfer of
immediately available funds to a bank account designated by the Company, against
delivery to the Representatives for the respective accounts of the Underwriters
of certificates for the Securities and the Guarantees to be purchased by them.
It is understood that each Underwriter has authorized the Representatives, for
its account, to accept delivery of, receipt for, and make payment of the
purchase price for, the Securities and the Guarantees which it has agreed to
purchase. ▇▇▇▇▇▇▇ ▇▇▇▇▇, individually and not as representative of the
Underwriters, may (but shall not be obligated to) make payment of the purchase
price for the Securities and the Guarantees to be purchased by any Underwriter
whose funds have not been received by the Closing Time, but such payment shall
not relieve such Underwriter from its obligations hereunder.
(c) Registration. Certificates for the Securities (including the Guarantees)
shall be initially issued in the form of a global security registered in the
name of Cede & Co. as a nominee of the Depository Trust Company ("DTC"). The
Securities (including the Guarantees) will be made available for examination by
the Representatives in The City of New York not later than 10:00 A.M. (Eastern
time) on the business day prior to the Closing Time.
(d) Appointment of Qualified Independent Underwriter. The Company and the
Guarantors hereby confirm their engagement of ▇▇▇▇▇▇▇ ▇▇▇▇▇ as, and ▇▇▇▇▇▇▇
▇▇▇▇▇ hereby confirms its agreement with the Company and the Guarantors to
render services as, a "qualified independent underwriter" within the meaning of
Rule 2720 of the Conduct Rules of the National Association of Securities
Dealers, Inc. ("NASD") with respect to the offering and sale of the Securities
and the Guarantees. ▇▇▇▇▇▇▇ ▇▇▇▇▇, solely in its capacity as qualified
independent underwriter and not otherwise, is referred to herein as the
"Independent Underwriter."
SECTION 3. Covenants of the Company and the Guarantors. The Company and the
Guarantors, jointly and severally, covenant with each Underwriter as follows:
(a) Compliance with Securities Regulations and Commission Requests. The Company
and the Guarantors, subject to Section 3(b), will comply with the requirements
of Rule 415, Rule 430A and/or Rule 434, as applicable, and will notify the
Representatives immediately, and confirm the notice in writing, (i) when any
post-effective amendment to the Registration Statement shall become effective,
or any supplement to the Prospectus or any amended Prospectus shall have been
filed, (ii) of the receipt of any comments from the Commission, (iii) of any
request by the Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus or for additional information and (iv)
of the issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or of any order preventing or suspending the use
of any preliminary prospectus, or of the suspension of the qualification of the
Securities and the Guarantees for offering or sale in any jurisdiction, or of
the initiation or threatening of any proceedings for any of such purposes. The
Company and the Guarantors will promptly effect the filings necessary pursuant
to Rule 424(b) and will take such steps as they deem necessary to ascertain
promptly whether the form of prospectus transmitted for filing under Rule 424(b)
was received for filing by the Commission and, in the event that it was not,
they will promptly file such prospectus. The Company and the
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Guarantors will make every reasonable effort to prevent the issuance of any stop
order and, if any stop order is issued, to obtain the lifting thereof at the
earliest possible moment.
(b) Filing of Amendments. The Company and the Guarantors will give the
Representatives notice of their intention to file or prepare any amendment to
the Registration Statement (including any filing under Rule 462(b)), any Term
Sheet or any amendment, supplement or revision to either the prospectus included
in the Registration Statement at the time it became effective or to the
Prospectus, whether pursuant to the 1933 Act, the 1934 Act or otherwise, will
furnish the Representatives with copies of any such documents a reasonable
amount of time prior to such proposed filing or use, as the case may be, and
will not file or use any such document to which the Representatives or counsel
for the Underwriters shall object.
(c) Delivery of Registration Statements. The Company and the Guarantors have
furnished or will deliver to the Representatives and counsel for the
Underwriters, without charge, signed copies of the Registration Statement as
originally filed and of each amendment thereto (including exhibits filed
therewith or incorporated by reference therein and documents incorporated or
deemed to be incorporated by reference therein) and signed copies of all
consents and certificates of experts, and will also deliver to the
Representatives, without charge, a conformed copy of the Registration Statement
as originally filed and of each amendment thereto (without exhibits) for each of
the Underwriters. The copies of the Registration Statement and each amendment
thereto furnished to the Underwriters will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to ▇▇▇▇▇, except
to the extent permitted by Regulation S-T.
(d) Delivery of Prospectuses. The Company and the Guarantors have delivered to
each Underwriter, without charge, as many copies of each preliminary prospectus
as such Underwriter reasonably requested, and the Company and the Guarantors
hereby consent to the use of such copies for purposes permitted by the 1933 Act.
The Company and the Guarantors will furnish to each Underwriter, without charge,
during the period when the Prospectus is required to be delivered under the 1933
Act or the 1934 Act, such number of copies of the Prospectus (as amended or
supplemented) as such Underwriter may reasonably request. The Prospectus and any
amendments or supplements thereto furnished to the Underwriters will be
identical to the electronically transmitted copies thereof filed with the
Commission pursuant to ▇▇▇▇▇, except to the extent permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company and the Guarantors
will comply with the 1933 Act and the 1933 Act Regulations, the 1934 Act and the
1934 Act Regulations and the 1939 Act and the 1939 Act Regulations so as to
permit the completion of the distribution of the Securities and the Guarantees
as contemplated in this Agreement and in the Prospectus. If at any time when a
prospectus is required by the 1933 Act or the 1934 Act to be delivered in
connection with sales of the Securities and the Guarantees, any event shall
occur or condition shall exist as a result of which it is necessary, in the
opinion of counsel for the Underwriters or for the Company and the Guarantors,
to amend the Registration Statement or amend or supplement the Prospectus in
order that the Prospectus will not include any untrue statements of a material
fact or omit to state a material fact necessary in order to make the
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statements therein not misleading in light of the circumstances existing at the
time it is delivered to a purchaser, or if it shall be necessary, in the opinion
of such counsel, at any such time to amend the Registration Statement or amend
or supplement the Prospectus in order to comply with the requirements of the
1933 Act or the 1933 Act Regulations, the Company and the Guarantors will
promptly prepare and file with the Commission, subject to Section 3(b), such
amendment or supplement as may be necessary to correct such statement or
omission or to make the Registration Statement or the Prospectus comply with
such requirements, and the Company and the Guarantors will furnish to the
Underwriters such number of copies of such amendment or supplement as the
Underwriters may reasonably request.
(f) Blue Sky Qualifications. The Company and the Guarantors will use their best
efforts, in cooperation with the Underwriters, to qualify the Securities and the
Guarantees for offering and sale under the applicable securities laws of such
states and other jurisdictions as the Representatives may designate and to
maintain such qualifications in effect for a period of not less than one year
from the later of the effective date of the Registration Statement and any Rule
462(b) Registration Statement; provided, however, that the Company and the
Guarantors shall not be obligated to file any general consent to service of
process or to qualify as foreign corporations or as dealers in securities in any
jurisdiction in which they are not so qualified or to subject themselves to
taxation in respect of doing business in any jurisdiction in which they are not
otherwise so subject. In each jurisdiction in which the Securities and the
Guarantees have been so qualified, the Company and the Guarantors will file such
statements and reports as may be required by the laws of such jurisdiction to
continue such qualification in effect for a period of not less than one year
from the effective date of the Registration Statement and any Rule 462(b)
Registration Statement. The Company and the Guarantors will also supply the
Underwriters with such information as is necessary for the determination of the
legality of the Securities and the Guarantees for investment under the laws of
such jurisdictions as the Underwriters may request.
(g) Rule 158. The Company and the Guarantors will timely file such reports
pursuant to the 1934 Act as are necessary in order to make generally available
to its securityholders as soon as practicable an earnings statement for the
purposes of, and to provide the benefits contemplated by, the last paragraph of
Section 11(a) of the 1933 Act.
(h) Use of Proceeds. The Company and the Guarantors will use the net proceeds
received by them from the sale of the Securities and the Guarantees in the
manner specified in the Prospectus under "Use of Proceeds".
(i) Restriction on Sale of Securities. During a period of 180 days from the date
of the Prospectus, the Company and the Guarantors will not, without the prior
written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇, directly or indirectly, issue, sell, offer or
contract to sell, grant any option for the sale of, or otherwise transfer or
dispose of, any debt securities or guarantees of debt securities of the Company
or any Guarantor, provided that this restriction shall not be deemed to limit
borrowings or guarantees under the New Credit Facility or pursuant to capital or
operating leases or purchase money obligations.
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(j) Reporting Requirements. The Company, during the period when the Prospectus
is required to be delivered under the 1933 Act or the 1934 Act, will file all
documents required to be filed with the Commission pursuant to the 1934 Act
within the time periods required by the 1934 Act and the 1934 Act Regulations.
(k) Rating of Securities. The Company and the Guarantors shall take all
reasonable action necessary to enable Standard & Poor's Corporation ("S&P") and
▇▇▇▇▇'▇ Investors Service, Inc. ("Moody's") to provide their respective credit
ratings of the Securities and the Guarantees.
(l) DTC Clearance. The Company and the Guarantors will use all reasonable
efforts in cooperation with the Underwriters to permit the Securities and the
Guarantees to be eligible for clearance and settlement through DTC.
SECTION 4. Payment of Expenses. (a) Expenses. The Company and the Guarantors,
jointly and severally, will pay all expenses incident to the performance of
their respective obligations under this Agreement, including (i) the
preparation, printing and filing of the Registration Statement (including
financial statements and exhibits) as originally filed and of each amendment
thereto, (ii) the preparation, printing and delivery to the Underwriters of this
Agreement, any Agreement among Underwriters, the Indenture and such other
documents as may be required in connection with the offering, purchase, sale,
issuance or delivery of the Securities and the Guarantees, (iii) the
preparation, issuance and delivery of the certificates for the Securities and
the Guarantees to the Underwriters, (iv) the fees and disbursements of the
Company's and the Guarantors' counsel, accountants and other advisors, (v) the
qualification of the Securities and the Guarantees under securities laws in
accordance with the provisions of Section 3(f) hereof, including filing fees and
the reasonable fees and disbursements of counsel for the Underwriters in
connection therewith and in connection with the preparation of a blue sky survey
and any supplement thereto, (vi) the printing and delivery to the Underwriters
of copies of each preliminary prospectus, any Term Sheets and of the Prospectus
and any amendments or supplements thereto, (vii) the preparation, printing and
delivery to the Underwriters of copies of any blue sky survey and any supplement
thereto, (viii) the fees and expenses of the Trustee, including the fees and
disbursements of counsel for the Trustee in connection with the Indenture, the
Securities and the Guarantees and (ix) any fees payable in connection with the
rating of the Securities.
(b) Termination of Agreement. If this Agreement is terminated by the
Representatives in accordance with the provisions of Section 5 or Section
9(a)(i) or (ii) hereof, the Company and the Guarantors, jointly and severally,
shall reimburse the Underwriters for all of their out-of-pocket expenses,
including the reasonable fees and disbursements of counsel for the Underwriters.
SECTION 5. Conditions of Underwriters' Obligations. The obligations of the
several Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company and the Guarantors contained in
Section 1 hereof or in certificates of any officer of the Company or any
Subsidiary of the Company, to the performance by the Company and the Guarantors
of their covenants and other obligations hereunder, and to the following further
conditions:
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(a) Effectiveness of Registration Statement. The Registration Statement,
including any Rule 462(b) Registration Statement, has become and remains
effective and at Closing Time no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the 1933 Act or proceedings
therefor initiated or threatened by the Commission, and any request on the part
of the Commission for additional information shall have been complied with to
the reasonable satisfaction of counsel to the Underwriters. A prospectus
containing the Rule 430A Information shall have been filed with the Commission
in accordance with Rule 424(b) (or a post-effective amendment providing such
information shall have been filed and declared effective in accordance with the
requirements of Rule 430A) or, if the Company and the Guarantors have elected to
rely upon Rule 434, a Term Sheet shall have been filed with the Commission in
accordance with Rule 424(b).
(b) Opinion of Counsel for Company. At Closing Time, the Representatives shall
have received the favorable opinions, dated as of Closing Time, of each of
LeBoeuf, Lamb, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, L.L.P., counsel for the Company and the
Guarantors, and E. ▇▇▇▇▇ ▇▇▇▇▇, Jr., Senior Vice President and General Counsel
of the Company, in each case in form and substance satisfactory to counsel for
the Underwriters, together with signed or reproduced copies of such letters for
each of the other Underwriters to the effect set forth in Exhibits A-1 and A-2,
respectively, hereto and to such further effect as counsel to the Underwriters
may reasonably request.
(c) Opinion of Counsel for Underwriters. At Closing Time, the Representatives
shall have received the favorable opinion, dated as of Closing Time, of Fried,
Frank, Harris, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the Underwriters, together with
signed or reproduced copies of such letter for each of the other Underwriters
with respect to the matters set forth in clauses (i) through (v), inclusive, and
(vii) through (ix), inclusive, and the third from last paragraph of Exhibit A-1
hereto. In giving such opinion such counsel may rely, as to all matters governed
by the laws of jurisdictions other than the law of the State of New York and the
federal law of the United States, upon the opinions of counsel satisfactory to
the Representatives. Such counsel may also state that, insofar as such opinion
involves factual matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company, the Guarantors and their Subsidiaries
and certificates of public officials.
(d) Officers' Certificate. At Closing Time, there shall not have been, since the
date hereof or since the respective dates as of which information is given in
the Prospectus, any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Company and its Subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, and the Representatives shall have
received a certificate of the President or a Vice President of the Company and
of the chief financial or chief accounting officer of the Company, and
equivalent officials of each Guarantor, dated as of Closing Time, to the effect
that (i) there has been no such material adverse change, (ii) the
representations and warranties in Section 1(a) hereof are true and correct with
the same force and effect as though expressly made at and as of Closing Time,
(iii) the Company and the Guarantors have complied with all agreements and
satisfied all conditions on their part to be performed or satisfied at or prior
to Closing Time and (iv) no stop order suspending the effectiveness of the
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Registration Statement has been issued and no proceedings for that purpose have
been instituted or, to the best of such officer's knowledge, are pending or are
contemplated by the Commission.
(e) Accountant's Comfort Letter. At the time of the execution of this Agreement,
the Representatives shall have received from KPMG LLP a letter dated such date,
in form and substance satisfactory to the Representatives, together with signed
or reproduced copies of such letter for each of the other Underwriters
containing statements and information of the type ordinarily included in
accountants' "comfort letters" to underwriters with respect to the financial
statements and certain financial information contained in the Registration
Statement and the Prospectus.
(f) Bring-down Comfort Letter. At Closing Time, the Representatives shall have
received from KPMG LLP a letter, dated as of Closing Time, to the effect that
they reaffirm the statements made in the letter furnished pursuant to subsection
(e) of this Section, except that the specified date referred to shall be a date
not more than three business days prior to Closing Time.
(g) Maintenance of Rating. At Closing Time, the Securities (and the Guarantees)
shall be rated at least Ba2 by Moody's Investor's Service Inc. and BB+ by
Standard & Poor's Ratings Group, a division of ▇▇▇▇▇▇-▇▇▇▇, Inc., and the
Company and the Guarantors shall have delivered to the Representatives a letter
dated the Closing Time, from each such rating agency, or other evidence
satisfactory to the Representatives, confirming that the Securities and the
Guarantees have such ratings; and since the date of this Agreement, there shall
not have occurred a downgrading in the rating assigned to the Securities and the
Guarantees or any of the Company's and the Guarantors' other debt securities or
debt instruments by any "nationally recognized statistical rating agency," as
that term is defined by the Commission for purposes of Rule 436(g)(2) under the
1933 Act, and no such organization shall have publicly announced that it has
under surveillance or review its rating of the Securities and the Guarantees or
any of the Company's and the Guarantors' other debt securities or debt
instruments.
(h) New Credit Facility. At the Closing Time and upon consummation of the
transactions contemplated hereby, (i) the Company and the Guarantors shall have
duly authorized, executed and delivered the New Credit Facility, (ii) the New
Credit Facility shall constitute a valid and binding obligation of the Company
and each of the Guarantors, enforceable against the Company and each of the
Guarantors in accordance with its terms, (iii) no default shall have occurred or
be continuing under the New Credit Facility, (iv) the Company shall have
borrowed at least $400 million under the New Credit Facility as described under
"Use of Proceeds" in the Prospectus and (v) the Company and the Guarantors shall
have received all consents necessary to the issuance and sale of the Securities
and the Guarantees and the consummation of the transactions contemplated hereby,
in each case in a form and substance satisfactory to the Representatives and
counsel for the Underwriters.
(i) Additional Documents. At Closing Time, counsel for the Underwriters shall
have been furnished with such documents and opinions as they may require for the
purpose of enabling them to pass upon the issuance and sale of the Securities
and the Guarantees as herein contemplated, or in order to evidence the accuracy
of any of the representations or warranties, or
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25
the fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company and the Guarantors in connection with the issuance and sale
of the Securities and the Guarantees as herein contemplated shall be
satisfactory in form and substance to the Representatives and counsel for the
Underwriters.
(j) Termination of Agreement. If any condition specified in this Section shall
not have been fulfilled when and as required to be fulfilled, this Agreement may
be terminated by the Representatives by notice to the Company at any time at or
prior to Closing Time, and such termination shall be without liability of any
party to any other party except as provided in Section 4 and except that
Sections 6, 7 and 8 shall survive any such termination and remain in full force
and effect.
SECTION 6. Indemnification.
(a) Indemnification of Underwriters. (1) The Company and each of the Guarantors,
jointly and severally, agree to indemnify and hold harmless each Underwriter and
each person, if any, who controls any Underwriter within the meaning of Section
15 of the 1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and expense whatsoever,
as incurred, arising out of any untrue statement or alleged untrue statement of
a material fact contained in the Registration Statement (or any amendment
thereto), including the Rule 430A Information and the Rule 434 Information, if
applicable, or the omission or alleged omission therefrom of a material fact
required to be stated therein or necessary to make the statements therein not
misleading or arising out of any untrue statement or alleged untrue statement of
a material fact contained in any preliminary prospectus or the Prospectus (or
any amendment or supplement thereto), or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense whatsoever,
as incurred, to the extent of the aggregate amount paid in settlement of any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or of any claim whatsoever based upon any such
untrue statement or omission, or any such alleged untrue statement or omission;
provided that (subject to Section 6(d) below) any such settlement is effected
with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred (including the fees
and disbursements of counsel chosen by ▇▇▇▇▇▇▇ ▇▇▇▇▇), reasonably incurred in
investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, to the extent that
any such expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue
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26
statement or omission made in reliance upon and in conformity with written
information furnished to the Company or the Guarantors by any Underwriter
through ▇▇▇▇▇▇▇ ▇▇▇▇▇ expressly for use in the Registration Statement (or any
amendment or supplement thereto), including the Rule 430A Information and the
Rule 434 Information, if applicable, or any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto); and provided, further, that
as to any preliminary prospectus this indemnity agreement shall not inure to the
benefit of the Underwriters or any person controlling the Underwriters on
account of any loss, claim, damage, liability or action based on any untrue
statement or alleged untrue statement or omission or alleged omission to state a
material fact in any preliminary prospectus arising from the sale of Securities
and Guarantees to any person by the Underwriters if the Underwriters failed to
send or give a copy of the Prospectus (as amended or supplemented) to that
person and the untrue statement or alleged untrue statement or omission or
alleged omission to state a material fact in such preliminary prospectus was
corrected in said amended or supplemented Prospectus and the delivery thereof
was required by law and would have constituted a complete defense to the claim
of that person in respect of such untrue statement or alleged untrue statement
or such omission or alleged omission, unless such failure resulted from
non-compliance by the Company or the Guarantors with Section 3(a) or (b) of this
Agreement. For purposes of the second proviso to the immediately preceding
sentence, the term Prospectus shall not be deemed to include the documents
incorporated by reference therein, and the Underwriters shall not be obligated
to send or give any supplement or amendment to any document incorporated by
reference in (x) a preliminary prospectus or supplement thereto or (y) the
Prospectus to any person.
(2) In addition to and without limitation of the Company's and the Guarantors'
obligation to indemnify ▇▇▇▇▇▇▇ ▇▇▇▇▇ as an Underwriter, the Company and each of
the Guarantors, jointly and severally, also agree to indemnify and hold harmless
the Independent Underwriter and each person, if any, who controls the
Independent Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act, from and against (i) any and all loss, liability,
claim, damage and expense to the same extent and in the same manner as provided
with respect to ▇▇▇▇▇▇▇ ▇▇▇▇▇ as an Underwriter under Section 6(a)(1), and (ii)
any and all loss, liability, claim, damage and expense, whatsoever, as otherwise
incurred as a result of the Independent Underwriter's participation as a
"qualified independent underwriter" within the meaning of Rule 2720 of the
Conduct Rules of NASD in connection with the offering of the Securities, except,
solely with respect to this clause (ii), any loss, liability, claim, damage or
expense resulting from the Independent Underwriter's willful misconduct or gross
negligence.
(b) Indemnification of Company, Guarantors, Directors and Officers. Each
Underwriter severally agrees to indemnify and hold harmless the Company, the
Guarantors, their directors, each of their officers who signed the Registration
Statement, and each person, if any, who controls the Company or any Guarantor
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
against any and all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a)(1) of this Section, as incurred, but only
with respect to untrue statements or omissions, or alleged untrue statements or
omissions, made in the Registration Statement (or any amendment thereto),
including the Rule 430A Information and the Rule 434 Information, if applicable,
or any preliminary prospectus or the Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written
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27
information furnished to the Company and the Guarantors by such Underwriter
through ▇▇▇▇▇▇▇ ▇▇▇▇▇ expressly for use in the Registration Statement (or any
amendment thereto) or such preliminary prospectus or the Prospectus (or any
amendment or supplement thereto).
(c) Actions against Parties; Notification. Each indemnified party shall give
notice as promptly as reasonably practicable to each indemnifying party of any
action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a)(1) above,
counsel to the indemnified parties shall be selected by ▇▇▇▇▇▇▇ ▇▇▇▇▇, and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances; provided, that, if indemnity is
sought pursuant to Section 6(a)(2), then, in addition to the fees and expenses
of such counsel for the indemnified parties, the indemnifying party shall be
liable for the reasonable fees and expenses of not more than one counsel (in
addition to any local counsel) separate from its own counsel and that of the
other indemnified parties for the Independent Underwriter in its capacity as a
"qualified independent underwriter" and all persons, if any, who control the
Independent Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of 1934 Act in connection with any one action or separate but similar
or related actions in the same jurisdiction arising out of the same general
allegations or circumstances if, in the reasonable judgment of the Independent
Underwriter, there may exist a conflict of interest between the Independent
Underwriter and the other indemnified parties. Any such separate counsel for the
Independent Underwriter and such control persons of the Independent Underwriter
shall be designated in writing by the Independent Underwriter. No indemnifying
party shall, without the prior written consent of the indemnified parties,
settle or compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or Section
7 hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any time an
indemnified party shall have requested an indemnifying party to 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
Section 6(a)(1)(ii) effected without its written consent if (i) such
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28
settlement is entered into more than 45 days after receipt by such indemnifying
party of the aforesaid request, (ii) such indemnifying party shall have received
notice of the terms of such settlement at least 30 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.
SECTION 7. Contribution. If the indemnification provided for in Section 6 hereof
is for any reason unavailable to or insufficient to hold harmless an indemnified
party in respect of any losses, liabilities, claims, damages or expenses
referred to therein, then each indemnifying party shall contribute to the
aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company and the
Guarantors, on the one hand, and the Underwriters, on the other hand, from the
offering of the Securities and the Guarantees pursuant to this Agreement or (ii)
if the allocation provided by clause (i) 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 and
the Guarantors, on the one hand, and of the Underwriters, on the other hand, in
connection with the statements or omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company and the Guarantors, on the one
hand, and the Underwriters, on the other hand, in connection with the offering
of the Securities and the Guarantees pursuant to this Agreement shall be deemed
to be in the same respective proportions as the total net proceeds from the
offering of the Securities and the Guarantees pursuant to this Agreement (before
deducting expenses) received by the Company and the Guarantors and the total
underwriting discount received by the Underwriters, in each case as set forth on
the cover of the Prospectus, or, if Rule 434 is used, the corresponding location
on the Term Sheet, bear to the aggregate initial public offering price of the
Securities (including the Guarantees) as set forth on such cover.
The relative fault of the Company and the Guarantors, on the one hand, and the
Underwriters, on the other hand, shall be determined by reference to, among
other things, whether any such untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to
information supplied by the Company or the Guarantors, or by the Underwriters,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company, the Guarantors and the Underwriters agree that ▇▇▇▇▇▇▇ ▇▇▇▇▇ will
not receive any additional benefits hereunder for serving as the Independent
Underwriter in connection with the offering and sale of the Securities.
The Company, the Guarantors and the Underwriters agree that it would not be just
and equitable if contribution pursuant to this Section 7 were 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 account of the
equitable considerations referred to above in this Section 7.
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29
The aggregate amount of losses, liabilities, claims, damages and expenses
incurred by an indemnified party and referred to above in this Section 7 shall
be deemed to include any legal or other expenses reasonably incurred by such
indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Securities (including the Guarantees) underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
any such untrue or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the ▇▇▇▇ ▇▇▇) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an Underwriter
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
shall have the same rights to contribution as such Underwriter, and each
director of the Company and each Guarantor, each officer of the Company and each
Guarantor who signed the Registration Statement, and each person, if any, who
controls the Company and each Guarantor within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act shall have the same rights to
contribution as the Company and each Guarantor. The Underwriters' respective
obligations to contribute pursuant to this Section 7 are several in proportion
to the principal amount of Securities (including the Guarantees) set forth
opposite their respective names in Schedule A hereto and not joint.
SECTION 8. Representations, Warranties and Agreements to Survive Delivery. All
representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company or any of its Subsidiaries submitted
pursuant hereto, shall remain operative and in full force and effect, regardless
of any investigation made by or on behalf of any Underwriter or controlling
person, or by or on behalf of the Company or any Guarantor, and shall survive
delivery of the Securities (including the Guarantees) to the Underwriters.
SECTION 9. Termination of Agreement.
(a) Termination; General. The Representatives may terminate this Agreement, by
notice to the Company, at any time at or prior to Closing Time (i) if there has
been, since the time of execution of this Agreement or since the respective
dates as of which information is given in the Prospectus, any material adverse
change in the condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company and its Subsidiaries considered as
one enterprise, whether or not arising in the ordinary course of business, or
(ii) if there shall have occurred a downgrading in the rating assigned to the
Securities or the Guarantees or any of the Company's or any Guarantors' other
debt securities or debt instruments by any nationally recognized securities
rating agency, or if such securities rating agency shall have publicly
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30
announced that it has under surveillance or review its rating of the Securities,
the Guarantees or any of the Company's or Guarantors' other debt securities or
debt instruments, or (iii) if there has occurred any material adverse change in
the financial markets in the United States or the international financial
markets, any outbreak of hostilities or escalation thereof or other calamity or
crisis or any change or development involving a prospective change in national
or international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the judgment of the Representatives,
impracticable to market the Securities or to enforce contracts for the sale of
the Securities, or (iv) if trading in any securities of the Company has been
suspended or materially limited by the Commission or the New York Stock
Exchange, or if trading generally on the American Stock Exchange or the New York
Stock Exchange or in the Nasdaq National Market has been suspended or materially
limited, or minimum or maximum prices for trading have been fixed, or maximum
ranges for prices have been required, by any of said exchanges or by such system
or by order of the Commission, the National Association of Securities Dealers,
Inc. or any other governmental authority, or (v) if a banking moratorium has
been declared by either Federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this Section, such
termination shall be without liability of any party to any other party except as
provided in Section 4 hereof, and provided further that Sections 6, 7 and 8
shall survive such termination and remain in full force and effect.
SECTION 10. Default by One or More of the Underwriters. If one or more of the
Underwriters shall fail at Closing Time to purchase the Securities (including
the Guarantees) which it or they are obligated to purchase under this Agreement
(the "Defaulted Securities"), the Representatives shall have the right, within
24 hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms herein set forth; if, however, the Representatives shall not have
completed such arrangements within such 24-hour period, then:
(a) if the number of Defaulted Securities does not exceed 10% of the aggregate
principal amount of the Securities (including the Guarantees) to be purchased
hereunder, each of the non-defaulting Underwriters shall be obligated, severally
and not jointly, to purchase the full amount thereof in the proportions that
their respective underwriting obligations hereunder bear to the underwriting
obligations of all non-defaulting Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the aggregate principal
amount of the Securities (including the Guarantees) to be purchased hereunder,
this Agreement shall terminate without liability on the part of any
non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination of this
Agreement, either the Representatives or the Company shall have the right to
postpone Closing Time for a period
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not exceeding seven days in order to effect any required changes in the
Registration Statement or Prospectus or in any other documents or arrangements.
As used herein, the term "Underwriter" includes any person substituted for an
Underwriter under this Section 10.
SECTION 11. Notices. All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given if mailed or transmitted by
any standard form of telecommunication. Notices to the Underwriters shall be
directed to the Representatives at North Tower, World Financial Center, New
York, New York 10281-1201, attention of ▇▇▇▇▇ ▇▇▇▇▇, with a copy to Fried,
Frank, Harris, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
attention of ▇▇▇▇▇▇▇ ▇▇▇▇ Jacob, Esq.; and notices to the Company or the
Guarantors shall be directed to them at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, attention of E. ▇▇▇▇▇ ▇▇▇▇▇, Jr., Esq., with a copy to
LeBoeuf, Lamb, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, L.L.P., ▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, attention of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇.
SECTION 12. Parties. This Agreement shall each inure to the benefit of and be
binding upon the Underwriters, the Company and the Guarantors 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, the Company and the Guarantors and their respective
successors and the controlling persons and officers and directors referred to in
Sections 6 and 7 and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the
Underwriters, the Company and the Guarantors and their respective successors,
and said controlling persons and officers and directors and their heirs and
legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of Securities and Guarantees from any Underwriter
shall be deemed to be a successor by reason merely of such purchase.
In all dealings with the Company and each of the Guarantors under this
Agreement, ▇▇▇▇▇▇▇ ▇▇▇▇▇ shall act on behalf of each of the several
Underwriters, and any action under this Agreement taken by ▇▇▇▇▇▇▇ ▇▇▇▇▇ will be
binding upon all the Underwriters.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED TIMES
OF DAY REFER TO NEW YORK CITY TIME.
SECTION 14. Effect of Headings. The Article and Section headings herein and the
Table of Contents are for convenience only and shall not affect the construction
hereof.
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If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company and the Guarantors a counterpart hereof,
whereupon this instrument, along with all counterparts, will become a binding
agreement among the Underwriters, the Company and the Guarantors in accordance
with its terms.
Very truly yours,
▇▇▇▇-▇▇▇▇▇ STORES, INC.
By: _________________________
Name:
Title:
ASTOR PRODUCTS, INC.
CRACKIN' GOOD, INC.
DEEP SOUTH PRODUCTS, INC.
▇▇▇▇▇ PACKERS, INC.
MONTEREY CANNING CO.
▇▇▇▇-▇▇▇▇▇ CHARLOTTE, INC.
▇▇▇▇-▇▇▇▇▇ LOGISTICS, INC.
▇▇▇▇-▇▇▇▇▇ LOUISIANA, INC.
▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, INC.
▇▇▇▇-▇▇▇▇▇ PROCUREMENT, INC.
▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇, INC.
By: _________________________
Name:
Title:
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CONFIRMED AND ACCEPTED,
as of the date first above written:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
FIRST UNION SECURITIES, INC.
BMO ▇▇▇▇▇▇▇ ▇▇▇▇▇ CORP.
CIBC WORLD MARKETS CORP.
CREDIT LYONNAIS SECURITIES (USA) INC.
FLEET SECURITIES, INC.
SUNTRUST EQUITABLE SECURITIES CORP.
By: ▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
By: __________________________________________
Authorized Signatory
For themselves and as Representatives of the
other Underwriters, if any, named in Schedule A hereto.
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34
SCHEDULE A
Principal
Amount of
Name of Underwriter Securities
------------------- ------------
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated................................................................... $124,500,000
First Union Securities, Inc.......................................................... 124,500,000
Fleet Securities, Inc................................................................ 15,000,000
BMO ▇▇▇▇▇▇▇ ▇▇▇▇▇ Corp............................................................... 9,000,000
CIBC World Markets Corp.............................................................. 9,000,000
Credit Lyonnais Securities (USA) Inc................................................. 9,000,000
SunTrust Equitable Securities Corp................................................... 9,000,000
------------
Total................................................................................ $300,000,000
============
35
SCHEDULE B
▇▇▇▇-▇▇▇▇▇ STORES, INC.
$300,000,000
8 7/8% Senior Notes Due 2008
1. The initial public offering price of the Securities shall be 100% of the
principal amount thereof, plus accrued interest, if any, from the date of
issuance.
2. The purchase price to be paid by the Underwriters for the Securities shall be
97.75% of the principal amount thereof.
3. The interest rate on the Securities shall be 8 7/8% per annum.
4. After April 1, 2005, the Company may redeem all or a portion of the
Securities, on not less than 30 or more than 60 days' prior notice, in amounts
of $1,000 or an integral multiple thereof at the following redemption prices
(expressed as percentages of the principal amount), if redeemed during the
12-month period beginning April 1 of the years indicated below:
Year Redemption Price
---- ----------------
2005 104.438%
2006 102.219%
and thereafter at 100% of the principal amount, in each case together with
accrued and unpaid interest, if any, to the redemption date.
5. At any time prior to April 1, 2004, the Company, at its option, may use the
net proceeds of one or more Public Equity Offerings to redeem up to an aggregate
of 35% of the aggregate principal amount of Securities originally issued under
the Indenture at a redemption price equal to 108.875% of the aggregate principal
amount of the securities redeemed, plus accrued and unpaid interest, if any, to
redemption date (subject to the rights of holders of record on relevant record
dates to receive interest due on an interest payment date). At least 65% of the
initial aggregate principal amount of Securities must remain outstanding
immediately after the occurrence of such redemption.
36
SCHEDULE C
List of Guarantors
Guarantor State of Incorporation
Astor Products, Inc. Florida
Crackin' Good, Inc. Florida
Deep South Products, Inc. Florida
▇▇▇▇▇ Packers, Inc. Florida
Monterey Canning Co. California
▇▇▇▇-▇▇▇▇▇ Charlotte, Inc. Florida
▇▇▇▇-▇▇▇▇▇ Logistics, Inc. Florida
▇▇▇▇-▇▇▇▇▇ Louisiana, Inc. Florida
▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, Inc. Florida
▇▇▇▇-▇▇▇▇▇ Procurement, Inc. Florida
▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇, Inc. Florida
37
SCHEDULE D
List of Subsidiaries
Astor Products, Inc.
Crackin' Good, Inc.
Deep South Distributors, Inc.
Deep South Products, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇ Bakers, Inc.
▇▇▇▇▇-Home Stores, Inc.
▇▇▇▇▇ Packers, Inc.
Economy Wholesale Distributors, Inc.
Foodway Stores, Inc.
Kwik Chek Supermarkets, Inc.
Kwik Chek Supermarkets of Illinois, Inc.
Kwik Chek Supermarkets of West Virginia, Inc.
Monterey Canning Co.
Save Rite Grocery Warehouse, Inc.
Sunbelt Products, Inc.
Superior Food Company
Table Supply Food Stores Co., Inc.
W-D (Bahamas) Limited
Bahamas Supermarkets Limited
The City Meat Markets Limited
W-D Brand Prestige Steaks, Inc.
▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Inc.
▇▇▇▇-▇▇▇▇▇ Handyman, Inc.
▇▇▇▇-▇▇▇▇▇ Logistics, Inc.
▇▇▇▇-▇▇▇▇▇ Louisiana, Inc.
▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, Inc.
▇▇▇▇-▇▇▇▇▇ Procurement, Inc.
▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇, Inc.
▇▇▇▇-▇▇▇▇▇ Supermarkets, Inc.
▇▇▇▇-▇▇▇▇▇ Supermarkets of Illinois, Inc.
▇▇▇▇-▇▇▇▇▇ Supermarkets of West Virginia, Inc.
38
Exhibit A-1
FORM OF OPINION OF LEBOEUF, LAMB, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, L.L.P.
TO BE DELIVERED PURSUANT TO SECTION 5(b)
March 29, 2001
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
FIRST UNION SECURITIES, INC.
BMO ▇▇▇▇▇▇▇ ▇▇▇▇▇ CORP.
CIBC WORLD MARKETS CORP.
CREDIT LYONNAIS SECURITIES (USA) INC.
FLEET SECURITIES, INC.
SUNTRUST EQUITABLE SECURITIES, INC.
c/o Merrill Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Re: ▇▇▇▇-▇▇▇▇▇ Stores, Inc.
8 7/8% Notes due 2008
Ladies and Gentlemen:
We have acted as counsel for ▇▇▇▇-▇▇▇▇▇ Stores, Inc., a Florida
corporation (the "Company"), in connection with the Purchase Agreement, dated
March 22, 2001 (the "Purchase Agreement"), between the Company and ▇▇▇▇▇▇▇
Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated, First Union Securities, Inc., BMO
▇▇▇▇▇▇▇ ▇▇▇▇▇ Corp., CIBC World Markets Corp., Credit Lyonnais Securities (USA),
Inc., Fleet Securities, Inc. and SunTrust Equitable Securities, Inc. as
representatives of the several underwriters (collectively, the "Underwriters"),
relating to the issuance and sale by the Company to the Underwriters upon the
terms and subject to the conditions set forth in the Purchase Agreement of
$300,000,000 aggregate principal amount of the Company's 8 7/8% Senior Notes due
2008 (the "Notes"), to be issued pursuant to an indenture dated as of December
26, 2001, as supplemented by the supplemental indenture dated as of March 29,
2001 between the Company, the Guarantors and Wilmington Trust Company, as
Trustee (as supplemented, the "Indenture"). Terms used in this opinion letter
which are not defined herein but which are defined, either directly or by
cross-reference, in the
39
Purchase Agreement are used herein with the respective meanings assigned to such
terms in the Purchase Agreement.
In connection with the preparation of this letter, we have examined
originals (or copies certified or otherwise identified to our satisfaction) of
such instruments, certificates and documents and have reviewed such questions of
laws as we have deemed necessary or appropriate for the purposes of the opinion
rendered below. In such examination, we have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as originals and
the conformity to the authentic original documents of all documents submitted to
us as copies. As to any facts material to our opinion we have, when relevant
facts were not independently established, relied upon the aforesaid instruments,
certificates and documents.
Upon the basis of such examination and review, we advise you that, in
our opinion:
(i) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Florida;
(ii) The Purchase Agreement has been duly authorized, executed and
delivered by the Company and each of the Guarantors;
(iii) The Indenture has been duly authorized, executed and delivered by the
Company and each of the Guarantors and (assuming the due authorization,
execution and delivery thereof by the Trustee) constitutes a valid and binding
agreement of the Company and each of the Guarantors, enforceable against the
Company and each of the Guarantors in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers), reorganization,
moratorium or similar laws affecting the enforcement of creditors' rights
generally and except as enforcement thereof is subject to general principles of
equity (regardless of whether enforcement is considered in a proceeding in
equity or at law);
(iv) The Notes have been duly authorized by the Company and, assuming that
the Notes have been duly authenticated by the Trustee in the manner described in
its certificate delivered to you today (which fact we have not determined by an
inspection of the Notes), the Notes have been duly executed, issued and
delivered by the Company and constitute valid and binding obligations of the
Company, enforceable against the Company in accordance with their terms, except
as the enforcement thereof may be limited by bankruptcy, insolvency (including,
without limitation, all laws relating to fraudulent transfers), reorganization,
moratorium or similar laws affecting enforcement of creditors' rights generally
and except as enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in equity or at
law), and will be entitled to the benefits of the Indenture;
(v) The Guarantees have been duly authorized by each of the Guarantors and,
assuming that the Notes have been duly authenticated by the Trustee in the
manner described in its certificate delivered to you today (which fact we have
not determined by an inspection of the Notes), the Guarantees have been duly
executed, issued and delivered by each of the Guarantors and constitute valid
and binding obligations of the Guarantors, enforceable against the Guarantors in
accordance with their terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all
40
laws relating to fraudulent transfers), reorganization, moratorium or similar
laws affecting enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity or at law), and will
be entitled to the benefits of the Indenture;
(vi) The Indenture has been duly qualified under the 1939 Act;
(vii) The Notes, the Guarantees, the Indenture and the New Credit Facility
conform in all material respects to the descriptions thereof contained in the
Prospectus;
(viii) The Registration Statement has been declared effective under the
1933 Act; any required filing of the Prospectus pursuant to Rule 424(b) has been
made in the manner and within the time period required by Rule 424(b); and, to
the best of our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued under the 1933 Act and no proceedings for
that purpose have been instituted or are pending or, to the best of our
knowledge, threatened by the Commission;
(ix) The Registration Statement, the Prospectus, excluding the documents
incorporated by reference therein, and each amendment or supplement to the
Registration Statement and Prospectus, excluding the documents incorporated by
reference therein, as of their respective effective or issue dates (other than
the financial statements and supporting schedules and other financial data
included or incorporated by reference therein or omitted therefrom, and the
Trustee's Statement of Eligibility on Form T-1, as to which we do not express an
opinion) each appeared on its face to be appropriately responsive in all
material respects to the applicable requirements of the 1933 Act and the 1933
Act Regulations;
(x) Neither the Company nor any of the Guarantors is an "investment
company" or an entity "controlled" by an "investment company," as such terms are
defined in the 1940 Act, both before and after giving effect to the use of
proceeds of the offering of the Notes and Guarantees; and
(xi) Subject to the limitations and qualifications stated therein, the
statements in the Prospectus under the heading "United States Federal Tax
Consequences" fairly summarize the provisions of the United States tax laws
therein described.
We are not passing upon, and do not assume any responsibility for, the
accuracy, completeness or correctness of the statements by the Company included
in the Registration Statement and the Prospectus. In the course or the
preparation of the Registration Statement and the Prospectus, we had conferences
with certain of the officers and employees of the Company and with the
independent auditors for the Company and reviewed certain corporate records,
documents and proceedings. Based upon our examination of the Registration
Statement and the above described procedures, we have no reason to believe that
the Registration Statement, when it became effective, contained any 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, at the time the Registration Statement became effective, at
the date of the Prospectus Supplement or at the date hereof, contained or
contains any untrue statement of a material fact or omitted or omits to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not
41
misleading, it being understood that we express no view as to the financial
statements and other financial data included therein.
In rendering the opinions expressed in clause (v) above, we have
relied, without independent investigation, upon the representation by the
Company contained in subsection (xxvii) of Section 1(a) of the Purchase
Agreement.
The opinions expressed herein are limited to the corporation laws of
the States of California, Florida and New York and United States Federal laws.
We are furnishing this opinion to you, as Underwriters, solely for your benefit.
This opinion is not to be used, circulated, quoted or otherwise referred to for
any other purpose.
Very truly yours,
42
Exhibit A-2
FORM OF OPINION OF E. ▇▇▇▇▇ ▇▇▇▇▇, JR.
TO BE DELIVERED PURSUANT TO SECTION 5(b)
March 29, 2001
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
FIRST UNION SECURITIES, INC.
BMO ▇▇▇▇▇▇▇ ▇▇▇▇▇ CORP.
CIBC WORLD MARKETS CORP.
CREDIT LYONNAIS SECURITIES (USA) INC.
FLEET SECURITIES, INC.
SUNTRUST EQUITABLE SECURITIES, INC.
c/o Merrill Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Re: ▇▇▇▇-▇▇▇▇▇ Stores, Inc.
8 7/8% Senior Notes due 2008
----------------------------
Ladies and Gentlemen:
I am Senior Vice President and General Counsel of ▇▇▇▇-▇▇▇▇▇ Stores,
Inc., a Florida corporation (the "Company"), and have acted as such in
connection with the Purchase Agreement, dated March 22, 2001 (the "Purchase
Agreement"), between the Company and ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated, First Union Securities, Inc., BMO ▇▇▇▇▇▇▇ ▇▇▇▇▇ Corp., CIBC World
Markets Corp., Credit Lyonnais Securities (USA), Inc., Fleet Securities, Inc.
and SunTrust Equitable Securities, Inc. as representatives of the several
underwriters (collectively, the "Underwriters"), relating to the issuance and
sale by the Company to the Underwriters upon the terms and subject to the
conditions set forth in the Purchase Agreement of $300,000,000 aggregate
principal amount of the Company's 8 7/8% Senior Notes due 2008 (the "Notes"), to
be issued pursuant to an indenture dated as of December 26, 2001, as
supplemented by the supplemental indenture dated as of March 29, 2001 between
the Company, the Guarantors and Wilmington Trust Company, as Trustee (as
supplemented, the "Indenture"). Terms used in this opinion letter which are not
defined herein but which are defined, either
43
directly or by cross-reference, in the Purchase Agreement are used herein with
the respective meanings assigned to such terms in the Purchase Agreement.
In connection with the preparation of this letter, I have examined
originals (or copies certified or otherwise identified to my satisfaction) of
such instruments, certificates and documents and have reviewed such questions of
laws as I have deemed necessary or appropriate for the purposes of the opinion
rendered below. In such examination, I have assumed the genuineness of all
signatures, the authenticity of all documents submitted to me as originals and
the conformity to the authentic original documents of all documents submitted to
me as copies. As to any facts material to my opinion I have, when relevant facts
were not independently established, relied upon the aforesaid instruments,
certificates and documents.
Upon the basis of such examination and review, I advise you that, in my
opinion:
(i) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Florida;
(ii) The Company has 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 Purchase
Agreement;
(iii) The Company 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 where the failure so to qualify or
to be in good standing would not result in a Material Adverse Effect;
(iv) The shares of issued and outstanding capital stock of the Company have
been duly authorized and validly issued and are fully paid and non-assessable;
and none of the outstanding shares of capital stock of the Company was issued in
violation of the preemptive or other similar rights of any securityholder of the
Company;
(v) Each Guarantor has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectus (and, with
respect to the Guarantors, to enter into and perform their obligations under the
Purchase Agreement) and 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 where the failure so to qualify or
to be in good standing would not result in a Material Adverse Effect; except as
otherwise disclosed in the Registration Statement and the Prospectus, all of the
issued and outstanding capital stock of each Guarantor has been duly authorized
and validly issued, is fully paid and non-assessable and, to the best of my
knowledge, is owned by the Company, directly or through Guarantors, free and
clear of any security interest, mortgage, pledge, lien, encumbrance, claim or
equity; none of the outstanding shares of
44
capital stock of any Guarantor was issued in violation of the preemptive or
similar rights of any securityholder of such Guarantor;
(vi) The Purchase Agreement has been duly authorized, executed and
delivered by the Company and each of the Guarantors;
(vii) The Indenture has been duly authorized, executed and delivered by the
Company and each of the Guarantors and (assuming the due authorization,
execution and delivery thereof by the Trustee) constitutes a valid and binding
agreement of the Company and each of the Guarantors, enforceable against the
Company and each of the Guarantors in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers), reorganization,
moratorium or similar laws affecting the enforcement of creditors' rights
generally and except as enforcement thereof is subject to general principles of
equity (regardless of whether enforcement is considered in a proceeding in
equity or at law);
(viii) The Notes have been duly authorized by the Company and, assuming
that the Notes have been duly authenticated by the Trustee in the manner
described in its certificate delivered to you today (which fact I have not
determined by an inspection of the Notes), the Notes have been duly executed,
issued and delivered by the Company and constitute valid and binding obligations
of the Company, enforceable against the Company in accordance with their terms,
except as the enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent transfers),
reorganization, moratorium or similar laws affecting enforcement of creditors'
rights generally and except as enforcement thereof is subject to general
principles of equity (regardless of whether enforcement is considered in a
proceeding in equity or at law), and will be entitled to the benefits of the
Indenture;
(ix) The Guarantees have been duly authorized by each of the Guarantors
and, assuming that the Notes have been duly authenticated by the Trustee in the
manner described in its certificate delivered to you today (which fact I have
not determined by an inspection of the Notes), the Guarantees have been duly
executed, issued and delivered by each of the Guarantors and constitute valid
and binding obligations of the Guarantors, enforceable against the Guarantors in
accordance with their terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or similar laws affecting
enforcement of creditors' rights generally and except as enforcement thereof is
subject to general principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law), and will be entitled to the
benefits of the Indenture;
(x) The Registration Statement has been declared effective under the 1933
Act; any required filing of the Prospectus pursuant to Rule 424(b) has been made
in the manner and within the time period required by Rule 424(b); and, to the
best of my knowledge, no stop order suspending the effectiveness of the
Registration Statement or any Rule 462(b) Registration
45
Statement has been issued under the 1933 Act and no proceedings for that purpose
have been instituted or are pending or, to the best of my knowledge, threatened
by the Commission;
(xi) The documents incorporated by reference in the Prospectus (other than
the financial statements and supporting schedules and other financial data
included or incorporated by reference therein or omitted therefrom, as to which
I do not express an opinion), when they were filed with the Commission, complied
as to form in all material respects with the requirements of the 1934 Act and
the rules and regulations of the Commission thereunder;
(xii) The information in the Prospectus under "Business--Litigation",
"Description of the Notes," "Description of Other Indebtedness" and in the
Registration Statement under Item 15, to the extent that it constitutes matters
of law, summaries of legal matters, the Company's charter and bylaws, legal
proceedings, legal conclusions or documents, has been reviewed by me and is
correct in all material respects;
(xiii) The New Credit Facility has been duly authorized, executed and
delivered by the Company and each of the Guarantors party thereto and (assuming
the due authorization, execution and delivery thereof by the lenders thereunder)
constitutes a valid and binding agreement of the Company and each of the
Guarantors party thereto, enforceable against the Company and each of such
Guarantors in accordance with its terms, except as the enforcement thereof may
be limited by bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium or similar laws
affecting enforcement of creditors' rights generally and except as enforcement
thereof is subject to general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law), it being
understood that I express no opinion with respect to the creation, priority or
perfection of any liens on security interests securing the New Credit Facility;
(xiv) To the best of my knowledge, there is not pending or threatened any
action, suit, proceeding, inquiry or investigation, to which the Company or any
Guarantor is a party, or to which the property of the Company or any Guarantor
is subject, before or brought by any court or governmental agency or body,
domestic or foreign, which might reasonably be expected to result in a Material
Adverse Effect on the Company and its Subsidiaries as one enterprise, or which
might reasonably be expected to materially and adversely affect the properties
or assets thereof or the consummation of the transactions contemplated in the
Purchase Agreement or the performance by the Company of its obligations
thereunder;
(xv) To the best of my knowledge, there are no statutes or regulations that
are required to be described in the Prospectus that are not described as
required;
(xvi) All descriptions in the Registration Statement of contracts and other
documents to which the Company or the Guarantors are a party are accurate in all
material respects; to the best of my knowledge, there are no franchises,
contracts, indentures, mortgages, loan agreements, notes, leases or other
instruments required to be described or referred to in the Registration
Statement or to be filed as exhibits thereto
46
other than those described or referred to therein or filed or incorporated by
reference as exhibits thereto, and the descriptions thereof or references
thereto are correct in all material respects;
(xvii) To the best of my knowledge, neither the Company nor any Guarantor
is in violation of its charter or by-laws and no default by the Company or any
Guarantor exists in the due performance or observance of any material
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other agreement or
instrument that is described or referred to in the Registration Statement or the
Prospectus or filed or incorporated by reference as an exhibit to the
Registration Statement;
(xviii) No filing with, or authorization, approval, consent, license,
order, registration, qualification or decree of, any court or governmental
authority or agency, domestic or foreign (other than under the 1933 Act, the
1939 Act and the regulations thereunder, which have been obtained, or as may be
required under the blue sky laws of the various states, as to which I do not
express an opinion) is necessary or required in connection with the due
authorization, execution and delivery of the Purchase Agreement by the Company
or the Guarantors or the due execution, delivery or performance of the Indenture
by the Company and the Guarantors or for the offering, issuance, sale or
delivery of the Notes and the Guarantees; and
(xix) The execution, delivery and performance of the Purchase Agreement,
the Indenture, the Notes, the Guarantees and the New Credit Facility and the
consummation of the transactions contemplated in the Purchase Agreement and in
the Registration Statement and Prospectus (including the issuance and sale of
the Notes and the Guarantees and the use of the proceeds from the sale of the
Notes as described in the Prospectus under the caption "Use Of Proceeds") and
compliance by the Company with its obligations under the Purchase Agreement, the
Indenture, the Notes, the Guarantees and the New Credit Facility do not and will
not, whether with or without the giving of notice or lapse of time or both,
conflict with or constitute a breach of, or default or Repayment Event (as
defined in Section 1(a)(xiii) of the Purchase Agreement) under or result in the
creation or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any Guarantor pursuant to any contract, indenture,
mortgage, deed of trust, loan or credit agreement, note, lease or any other
agreement or instrument, known to me, to which the Company or any Guarantor 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 Guarantor is subject (except for such
conflicts, breaches or defaults or liens, charges or encumbrances contemplated
by the New Credit Facility or that would not have a Material Adverse Effect),
nor will such action result in any violation of the provisions of the charter or
by-laws of the Company or any Guarantor, or to my knowledge, any applicable law,
statute, rule, regulation, judgment, order, writ or decree, known to me, of any
government, government instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any Guarantor or any of their respective
properties, assets or operations.
47
Nothing has come to my attention that would lead me to believe that the
Registration Statement or any amendment thereto (except for financial statements
and schedules and other financial data included or incorporated by reference
therein or omitted therefrom and the Form T-1, as to which I make no statement),
at the time such Registration Statement or any such amendment 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 or any amendment or supplement thereto
(except for financial statements and schedules and other financial data included
or incorporated by reference therein or omitted therefrom and the Form T-1, as
to which I make no statement), at the time the Prospectus was issued, at the
time any such amended or supplemented prospectus was issued or at the Closing
Time, included or includes an untrue statement of a material fact or omitted or
omits to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
In rendering the opinions expressed in clause (ix) above, I have
relied, without independent investigation, upon the representation by the
Company contained in subsection (xxvii) of Section 1(a) of the Purchase
Agreement.
The opinions expressed herein are limited to the corporation laws of
the States of Florida and New York and United States Federal laws, except for
the matters stated in clauses (v), (ix) and (xix) above, which are not subject
to such limitations. I am furnishing this opinion to you, as Underwriters,
solely for your benefit. This opinion is not to be used, circulated, quoted or
otherwise referred to for any other purpose.
Very truly yours,
E. ▇▇▇▇▇ ▇▇▇▇▇
Senior Vice President and General Counsel