1
EXHIBIT 1.1
FWT, INC.
$105,000,000
9 7/8% SENIOR SUBORDINATED NOTES
PURCHASE AGREEMENT
November 12, 1997
BT Alex. Xxxxx Incorporated
SBC Warburg Dillon Read Inc.
Xxxxx Xxxxxx Inc.
c/o BT Alex. Xxxxx Incorporated
Bankers Trust Plaza
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
FWT, Inc., a Texas corporation (the "Company"), hereby confirms its
agreement with you (the "Initial Purchasers"), as set forth below.
1. The Securities. Subject to the terms and conditions herein
contained, the Company proposes to issue and sell to the Initial Purchasers
$105,000,000 aggregate principal amount of its 9 7/8% Senior Subordinated Notes
(the "Notes"). The Notes are to be issued under an indenture (the "Indenture")
to be dated as of November 15, 1997 by and between the Company and Norwest Bank
Minnesota, N.A., as Trustee (the "Trustee").
The Notes will be offered and sold to the Initial Purchasers without
being registered under the Securities Act of 1933, as amended (the "Act"), in
reliance on exemptions therefrom.
In connection with the sale of the Notes, the Company has prepared a
preliminary offering memorandum dated October 31, 1997 (the "Preliminary
Memorandum"), and a final offering memorandum dated November 12, 1997 (the
"Final Memorandum"; the Preliminary Memorandum and the Final Memorandum each
herein being referred to as a "Memorandum") setting forth or including a
description of the terms of the Notes, the terms of the offering of the Notes, a
description of the Company and any material developments relating to the Company
occurring after the
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date of the most recent historical financial statements included therein
(capitalized terms used herein without definition have the meanings given such
terms in the Memorandum).
The Initial Purchasers and their direct and indirect transferees of
the Notes will be entitled to the benefits of the Registration Rights Agreement,
substantially in the form attached hereto as Exhibit A (the "Registration Rights
Agreement"), pursuant to which the Company has agreed, among other things, to
file a registration statement (the "Registration Statement") with the Securities
and Exchange Commission (the "Commission") registering the Notes or the Exchange
Notes (as defined in the Registration Rights Agreement) under the Act.
2. Representations and Warranties. The Company represents and warrants
to and agrees with each of the Initial Purchasers that:
(a) Neither the Preliminary Memorandum as of the date thereof nor the
Final Memorandum nor any amendment or supplement thereto as of the date thereof
and at all times subsequent thereto up to the Closing Date (as defined in
Section 3 below) contained or contains any untrue statement of a material fact
or omitted or omits to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, except that the representations and warranties set forth in this
Section 2(a) do not apply to statements or omissions made in reliance upon and
in conformity with information relating to either of the Initial Purchasers
furnished to the Company in writing by the Initial Purchasers expressly for use
in the Preliminary Memorandum, the Final Memorandum or any amendment or
supplement thereto.
(b) As of the Closing Date, the Company will have the authorized,
issued and outstanding capitalization set forth in the Final Memorandum; the
Company has no subsidiaries; all of the outstanding shares of capital stock of
the Company have been, and as of the Closing Date will be, duly authorized and
validly issued, are fully paid and nonassessable and were not issued in
violation of any preemptive or similar rights, and were issued and sold in
compliance with all applicable Federal and state securities laws. Except as
disclosed in the Final Memorandum, the Company does not own, directly or
indirectly, any shares of capital stock or any other equity or long-term debt
securities or have any equity interest in any firm, partnership, joint venture
or other entity.
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(c) The Company is duly incorporated, validly existing and in good
standing under the laws of Texas and has all requisite corporate power and
authority to own its properties and conduct its business as now conducted and as
described in the Final Memorandum; the Company is duly qualified to do business
as a foreign corporation in good standing in all other jurisdictions where the
ownership or leasing of its properties or the conduct of its business requires
such qualification, except where the failure to be so qualified would not,
individually or in the aggregate, have a material adverse effect on the general
affairs, management, business, condition (financial or otherwise), prospects or
results of operations of the Company(any such event, a "Material Adverse
Effect").
(d) The Company has all requisite corporate power and authority to
execute, deliver and perform each of its obligations under the Notes, the
Exchange Notes and the Private Exchange Notes (as defined in the Registration
Rights Agreement). The Notes, when issued, will be in the form contemplated by
the Indenture. The Notes, the Exchange Notes and the Private Exchange Notes have
each been duly and validly authorized by the Company and, when executed by the
Company and authenticated by the Trustee in accordance with the provisions of
the Indenture and, in the case of the Notes, when delivered to and paid for by
the Initial Purchasers in accordance with the terms of this Agreement, will
constitute valid and legally binding obligations of the Company, entitled to the
benefits of the Indenture, and enforceable against the Company in accordance
with their terms, except that the enforcement thereof may be subject to (i)
bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and (ii) general principles of equity and the
discretion of the court before which any proceeding therefor may be brought.
(e) The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under the Indenture. The Indenture
meets the requirements for qualification under the Trust Indenture Act of 1939,
as amended (the "TIA"). The Indenture has been duly and validly authorized by
the Company and, when executed and delivered by the Company (assuming the due
authorization, execution and delivery by the Trustee), will constitute a valid
and legally binding agreement of the Company, enforceable against the Company in
accordance with its terms, except that the enforcement thereof may be subject to
(i) bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights
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generally and (ii) general principles of equity and the discretion of the court
before which any proceeding therefor may be brought.
(f) The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under the Registration Rights
Agreement. The Registration Rights Agreement has been duly and validly
authorized by the Company and, when executed and delivered by the Company, will
constitute a valid and legally binding agreement of the Company enforceable
against the Company in accordance with its terms, except that (A) the
enforcement thereof may be subject to (i) bankruptcy, insolvency,
reorganization, fraudulent conveyance or transfer, moratorium or other similar
laws now or hereafter in effect relating to creditors' rights generally and (ii)
general principles of equity and the discretion of the court before which any
proceeding therefor may be brought and (B) any rights to indemnity or
contribution thereunder may be limited by federal and state securities laws and
public policy considerations.
(g) The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby. This Agreement and the
consummation by the Company of the transactions contemplated hereby have been
duly and validly authorized by the Company. This Agreement has been duly
executed and delivered by the Company.
(h) No consent, approval, authorization or order of any court or
governmental agency or body, or third party is required for the issuance and
sale by the Company of the Notes to the Initial Purchasers or the consummation
by the Company of the other transactions contemplated hereby, except such as
have been obtained and such as may be required under state securities or "Blue
Sky" laws in connection with the purchase and resale of the Notes by the Initial
Purchasers. The Company is not (i) in violation of its articles of incorporation
or bylaws (or similar organizational document), (ii) in breach or violation of
any statute, judgment, decree, order, rule or regulation applicable to any of
them or any of their respective properties or assets, except for any such breach
or violation which would not, individually or in the aggregate, have a Material
Adverse Effect, or (iii) in breach of or default under (nor has any event
occurred which, with notice or passage of time or both, would constitute a
default under) or in violation of any of the terms or provisions of any
indenture, mortgage, deed of trust, loan agreement, note, lease, license,
franchise agreement
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permit, certificate, contract or other agreement or instrument to which it is a
party or to which it or its properties or assets is subject (collectively,
"Contracts"), except for any such breach, default, violation or event which
would not, individually or in the aggregate, have a Material Adverse Effect.
(i) The execution, delivery and performance by the Company of this
Agreement, the Indenture and the Registration Rights Agreement and the
consummation by the Company of the transactions contemplated hereby and thereby
(including, without limitation, the issuance and sale of the Notes to the
Initial Purchasers) will not conflict with or constitute or result in a breach
of or a default under (or an event which with notice or passage of time or both
would constitute a default under) or violation of any of (i) the terms or
provisions of any Contract, except for any such conflict, breach, violation,
default or event which would not, individually or in the aggregate, have a
Material Adverse Effect, (ii) the articles of incorporation or bylaws (or
similar organizational document) of the Company or (iii) (assuming compliance
with all applicable state securities or "Blue Sky" laws and assuming the
accuracy of the representations and warranties of the Initial Purchasers in
Section 8 hereof) any statute, judgment, decree, order, rule or regulation
applicable to the Company or any of its properties or assets, except for any
such conflict, breach or violation which would not, individually or in the
aggregate, have a Material Adverse Effect.
(j) The audited financial statements of the Company included in the
Final Memorandum present fairly in all material respects the financial position,
results of operations and cash flows of the Company at the dates and for the
periods to which they relate and have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis, except as
otherwise stated therein. The summary and selected financial and statistical
data in the Final Memorandum present fairly in all material respects the
information shown therein and, to the extent such information and data are
derived from the financial books and records of the Company have been prepared
and compiled on a basis consistent with the audited financial statements
included therein, except as otherwise stated therein. Xxxxxx Xxxxxxxx LLP (the
"Independent Accountants") is an independent public accounting firm within the
meaning of the Act and the rules and regulations promulgated thereunder.
(k) The pro forma financial statements (including the notes thereto)
and the other pro forma financial information
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included in the Final Memorandum (i) comply as to form in all material respects
with the applicable requirements of Regulation S-X promulgated under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), (ii) have been
prepared in accordance with the Commission's rules and guidelines with respect
to pro forma financial statements, and (iii) have been properly computed on the
bases described therein; the assumptions used in the preparation of the pro
forma financial data and other pro forma financial information included in the
Final Memorandum are reasonable and the adjustments used therein are appropriate
to give effect to the transactions or circumstances referred to therein.
(l) There is not pending or, to the knowledge of the Company,
threatened any action, suit, proceeding, inquiry or investigation to which the
Company is a party, or to which the property or assets of the Company are
subject, before or brought by any court, arbitrator or governmental agency or
body which, if determined adversely to the Company would, individually or in the
aggregate, have a Material Adverse Effect or which seeks to restrain, enjoin,
prevent the consummation of or otherwise challenge the issuance or sale of the
Notes to be sold hereunder or the consummation of the other transactions
described in the Final Memorandum.
(m) The Company possesses all licenses, permits, certificates,
consents, orders, approvals and other authorizations from, and has made all
declarations and filings with, all federal, state, local and other governmental
authorities, all self-regulatory organizations and all courts and other
tribunals, presently required or necessary to own or lease, as the case may be,
and to operate its respective properties and to carry on its respective
businesses as now or proposed to be conducted as set forth in the Final
Memorandum ("Permits"), except where the failure to obtain such Permits would
not, individually or in the aggregate, have a Material Adverse Effect; the
Company has fulfilled and performed all of its obligations with respect to such
Permits and no event has occurred which allows, or after notice or lapse of time
would allow, revocation or termination thereof or results in any other material
impairment of the rights of the holder of any such Permit; the Company has not
received any notice of any proceeding relating to revocation or modification of
any such Permit, except as described in the Final Memorandum and except where
such revocation or modification would not, individually or in the aggregate,
have a Material Adverse Effect.
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(n) Since the date of the most recent financial statements appearing
in the Final Memorandum, and except as described in the Final Memorandum, (i)
the Company has not incurred any liabilities or obligations, direct or
contingent, or entered into or agreed to enter into any transactions or
contracts (written or oral) not in the ordinary course of business which
liabilities, obligations, transactions or contracts would, individually or in
the aggregate, be material to the general affairs, management, business,
condition (financial or otherwise), prospects or results of operations of the
Company, (ii) the Company has not purchased any of its outstanding capital
stock, nor declared, paid or otherwise made any dividend or distribution of any
kind on its capital stock and (iii) there shall not have been any material
change in the capital stock or long-term indebtedness of the Company.
(o) The Company has filed all necessary federal, state and foreign
income and franchise tax returns, except where the failure to so file such
returns would not, individually or in the aggregate, have a Material Adverse
Effect, and has paid all taxes shown as due thereon; and other than tax
deficiencies which the Company is contesting in good faith and for which the
Company has provided adequate reserves, there is no tax deficiency that has been
asserted against the Company that would have, individually or in the aggregate,
a Material Adverse Effect.
(p) The statistical and market-related data included in the Final
Memorandum are based on or derived from sources which the Company believes to be
reliable and accurate.
(q) None of the Company or any agent acting on its behalf has taken or
will take any action that might cause this Agreement or the sale of the Notes to
violate Regulation G, T, U or X of the Board of Governors of the Federal Reserve
System, in each case as in effect, or as the same may hereafter be in effect, on
the Closing Date.
(r) The Company has good and indefeasible title to all real property
and good title to all personal property described in the Final Memorandum as
being owned by it and good and indefeasible title to a leasehold estate in the
real and personal property described in the Final Memorandum as being leased by
it free and clear of all liens (except Liens securing the Senior Credit Facility
and the Revolving Credit Agreement), charges, encumbrances or restrictions,
except as described in the Final Memorandum or to the extent the failure to have
such title or the existence of such liens, charges, encumbrances or
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restrictions would not, individually or in the aggregate, have a Material
Adverse Effect. All material leases, contracts and agreements to which the
Company is a party or by which it is bound are valid and enforceable against the
Company, and to the knowledge of the Company are valid and enforceable against
the other party or parties thereto and are in full force and effect with only
such exceptions as would not, individually or in the aggregate, have a Material
Adverse Effect. The Company owns, possesses or has an interest in adequate
licenses or other rights to use all patents, trademarks, service marks, trade
names, copyrights and know-how necessary to conduct the businesses now or
proposed to be operated by it as described in the Final Memorandum, and the
Company has not received any notice of infringement of or conflict with (or
knows of any such infringement of or conflict with) asserted rights of others
with respect to any patents, trademarks, service marks, trade names, copyrights
or know-how which, if such assertion of infringement or conflict were sustained,
would have a Material Adverse Effect.
(s) There are no legal or governmental proceedings involving or
affecting the Company or any of its properties or assets which would be required
to be described in a prospectus pursuant to the Act that are not described in
the Final Memorandum, nor are there any material contracts or other documents
which would be required to be described in a prospectus pursuant to the Act that
are not described in the Final Memorandum.
(t) Except as would not, individually or in the aggregate, have a
Material Adverse Effect (A) the Company is in compliance with and not subject to
liability under applicable Environmental Laws (as defined below), (B) the
Company has made all filings and provided all notices required under any
applicable Environmental Law, and has and is in compliance with all Permits
required under any applicable Environmental Laws and each of them is in full
force and effect, (C) there is no civil, criminal or administrative action,
suit, demand, claim, hearing, notice of violation, investigation, proceeding,
notice or demand letter or request for information pending or, to the knowledge
of the Company threatened against the Company under any Environmental Law, (D)
no lien, charge, encumbrance or restriction has been recorded under any
Environmental Law with respect to any assets, facility or property owned,
operated, leased or controlled by the Company, (E) the Company has not received
notice that it has been identified as a potentially responsible party under the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended ("CERCLA") or any comparable state law and (F) no property or
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facility of the Company is (i) listed or proposed for listing on the National
Priorities List under CERCLA or is (ii) listed in the Comprehensive
Environmental Response, Compensation, Liability Information System List
promulgated pursuant to CERCLA, or on any comparable list maintained by any
state or local governmental authority.
For purposes of this Agreement, "Environmental Laws" means the common
law and all applicable federal, state and local laws or regulations, codes,
orders, decrees, judgments or injunctions issued, promulgated, approved or
entered thereunder, relating to pollution or protection of public or employee
health and safety or the environment, including, without limitation, laws
relating to (i) emissions, discharges, releases or threatened releases of
hazardous materials into the environment (including, without limitation, ambient
air, surface water, ground water, land surface or subsurface strata), (ii) the
manufacture, processing, distribution, use, generation, treatment, storage,
disposal, transport or handling of hazardous materials, and (iii) underground
and above ground storage tanks and related piping, and emissions, discharges,
releases or threatened releases therefrom.
(u) There is no strike, labor dispute, slowdown or work stoppage with
the employees of the Company which is pending or, to the knowledge of the
Company, threatened.
(v) The Company carries insurance in such amounts and covering such
risks as is adequate for the conduct of its business and the value of its
properties.
(w) Except as set forth in the Final Memorandum and $140,000 of plan
funding liability, the Company has no liability for any prohibited transaction
or funding deficiency or any complete or partial withdrawal liability with
respect to any pension, profit sharing or other plan which is subject to the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), to which
the Company makes or ever has made a contribution and in which any employee of
the Company has ever been a participant. With respect to such plans, the Company
is in compliance in all material respects with all applicable provisions of
ERISA.
(x) The Company maintains a system of internal accounting controls
which provide reasonable assurance that (A) transactions are executed in
accordance with management's authorization, (B) material transactions are
recorded as necessary to permit preparation of its financial statements and to
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maintain accountability for its assets and (C) access to its assets is permitted
only in accordance with management's authorization.
(y) The Company is not, and will not be immediately following the
receipt of the proceeds contemplated hereby, be an "investment company" or
"promoter" or "principal underwriter" for an "investment company," as such terms
are defined in the Investment Company Act of 1940, as amended, and the rules and
regulations thereunder.
(z) The Notes, the Indenture and the Registration Rights Agreement
will conform in all material respects to the descriptions thereof in the Final
Memorandum.
(aa) No holder of securities of the Company will be entitled to have
such securities registered under the registration statements required to be
filed by the Company pursuant to the Registration Rights Agreement other than as
expressly permitted thereby.
(bb) Immediately after the consummation of the transactions
contemplated by this Agreement, the fair value and present fair saleable value
of the assets of the Company will not exceed the sum of its stated liabilities
and identified contingent liabilities; the Company is not, nor will it be, after
giving effect to the execution, delivery and performance of this Agreement, and
the consummation of the transactions contemplated hereby, (a) left with
unreasonably small capital with which to carry on its business as it is proposed
to be conducted, (b) unable to pay its debts (contingent or otherwise) as they
mature or (c) otherwise insolvent.
(cc) None of the Company or any of its Affiliates (as defined in Rule
501(b) of Regulation D under the Act) has directly, or through any agent
(provided that no representation is made as to the Initial Purchasers or any
person acting on their behalf), (i) sold, offered for sale, solicited offers to
buy or otherwise negotiated in respect of, any "security" (as defined in the
Act) which is or will be integrated with the sale of the Notes in a manner that
would require the registration under the Act of the Notes or (ii) engaged in any
form of general solicitation or general advertising (as those terms are used in
Regulation D under the Act) in connection with the offering of the Notes or in
any manner involving a public offering within the meaning of Section 4(2) of the
Act. Assuming the accuracy of the representations and warranties of the Initial
Purchasers
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comply with the procedures set forth in Section 8, it is not necessary in
connection with the offer, sale and delivery of the Notes to the Initial
Purchasers in the manner contemplated by this Agreement to register any of the
Notes under the Act or to qualify the Indenture under the TIA.
(dd) No securities of the Company are of the same class (within the
meaning of Rule 144A under the Act) as the Notes and listed on a national
securities exchange registered under Section 6 of the Exchange Act, or quoted in
a U.S. automated inter-dealer quotation system.
(ee) The Company has not taken, nor will it take, directly or
indirectly, any action designed to, or that might be reasonably expected to,
cause or result in stabilization or manipulation of the price of the Notes.
(ff) None of the Company, any of its Affiliates or any person acting
on its or their behalf (other than the Initial Purchasers) has engaged in any
directed selling efforts (as that term is defined in Regulation S under the Act
("Regulation S")) with respect to the Notes; the Company, and its Affiliates and
any person acting on its or their behalf (other than the Initial Purchasers)
have complied with the offering restrictions requirement of Regulation S.
3. Purchase, Sale and Delivery of the Notes. On the basis of the
representations, warranties, agreements and covenants herein contained and
subject to the terms and conditions herein set forth, the Company agrees to
issue and sell to the Initial Purchasers, and the Initial Purchasers, acting
severally and not jointly, agree to purchase the Notes in the respective amounts
set forth on Schedule 1 hereto from the Company at 97% of their principal
amount. One or more certificates in definitive form for the Notes that the
Initial Purchasers have agreed to purchase hereunder, and in such denomination
or denominations and registered in such name or names as the Initial Purchasers
request upon notice to the Company at least 36 hours prior to the Closing Date,
shall be delivered by or on behalf of the Company to the Initial Purchasers,
against payment by or on behalf of the Initial Purchasers of the purchase price
therefor by wire transfer (immediately available funds), to such account or
accounts as the Company shall specify prior to the Closing Date, or by such
means as the parties hereto shall agree prior to the Closing Date. Such delivery
of and payment for the Notes shall be made at the offices of Xxxxxx Xxxxxx &
Xxxxxxx, 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx at 10:00 A.M., New York time, on
November , 1997, or at such
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other place, time or date as the Initial Purchasers, on the one hand, and the
Company, on the other hand, may agree upon, such time and date of delivery
against payment being herein referred to as the "Closing Date." The Company will
make such certificate or certificates for the Notes available for checking and
packaging by the Initial Purchasers at the offices of BT Alex. Xxxxx
Incorporated in New York, New York, or at such other place as BT Alex. Xxxxx
Incorporated may designate, at least 10:00 A.M. on the last Business Day prior
to the Closing Date.
4. Offering by the Initial Purchasers. The Initial Purchasers propose
to make an offering of the Notes at the price and upon the terms set forth in
the Final Memorandum, as soon as practicable after this Agreement is entered
into and as in the judgment of the Initial Purchasers is advisable.
5. Covenants of the Company. The Company covenants and agrees with
each of the Initial Purchasers that:
(a) The Company will not amend or supplement the Final Memorandum or
any amendment or supplement thereto of which the Initial Purchasers shall not
previously have been advised and furnished a copy for a reasonable period of
time prior to the proposed amendment or supplement and as to which the Initial
Purchasers shall not have given their consent, which consent shall not be
unreasonably withheld. The Company will promptly, upon the reasonable request of
the Initial Purchasers or counsel for the Initial Purchasers, make any
amendments or supplements to the Preliminary Memorandum or the Final Memorandum
that may be necessary or advisable to comply with Section 5(c) below.
(b) The Company will cooperate with the Initial Purchasers in
arranging for the qualification of the Notes for offering and sale under the
securities or "Blue Sky" laws of which jurisdictions as the Initial Purchasers
may designate and will continue such qualifications in effect for as long as may
be necessary to complete the resale of the Notes; provided, however, that in
connection therewith, the Company shall not be required to qualify as a foreign
corporation or to execute a general consent to service of process in any
jurisdiction or subject itself to taxation in excess of a nominal dollar amount
in any such jurisdiction where it is not then so subject.
(c) If, at any time prior to the completion of the distribution by the
Initial Purchasers of the Notes or the Private Exchange Notes, any event occurs
or information becomes known as a result of which the Final Memorandum as then
amended
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or supplemented would include any untrue statement of a material fact, or omit
to state a material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading, or if for any
other reason it is necessary at any time to amend or supplement the Final
Memorandum to comply with applicable law, the Company will promptly notify the
Initial Purchasers thereof and will prepare, at the expense of the Company, an
amendment or supplement to the Final Memorandum that corrects such statement or
omission or effects such compliance.
(d) The Company will, without charge, provide to the Initial
Purchasers and to counsel for the Initial Purchasers as many copies of the
Preliminary Memorandum and the Final Memorandum or any amendment or supplement
thereto as the Initial Purchasers may reasonably request.
(e) The Company will apply the net proceeds from the sale of the Notes
to repay the Senior Credit Facility, as set forth under "Use of Proceeds" in the
Final Memorandum.
(f) For so long as any of the Notes remain outstanding and the Company
is not subject to the Exchange Act, the Company will furnish to the Initial
Purchasers copies of all reports and other communications (financial or
otherwise) furnished by the Company to the Trustee or to the holders of the
Notes.
(g) Prior to the Closing Date, the Company will furnish to the Initial
Purchasers, as soon as they have been prepared, a copy of any unaudited interim
financial statements of the Company for any period subsequent to the period
covered by the most recent financial statements appearing in the Final
Memorandum.
(h) None of the Company or any of its Affiliates will sell, offer for
sale or solicit offers to buy or otherwise negotiate in respect of any
"security" (as defined in the Act) which could be integrated with the sale of
the Notes in a manner which would require the registration under the Act of the
Notes.
(i) The Company will not engage in any form of general solicitation or
general advertising (as those terms are used in Regulation D under the Act) in
connection with the offering of the Notes or in any manner involving a public
offering of the Notes within the meaning of Section 4(2) of the Act.
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(j) For so long as any of the Notes remain outstanding, the Company
will make available at its expense, upon request, to any holder of such Notes
and any prospective purchasers thereof the information specified in Rule
144A(d)(4) under the Act, unless the Company has consummated the Exchange Offer
the provisions of the Registration Rights Agreement or unless the Company is
then subject to Section 13 or 15(d) of the Exchange Act.
(k) The Company will use its best efforts to (i) permit the Notes to
be designated PORTAL securities in accordance with the rules and regulations
adopted by the NASD relating to trading in the Private Offerings, Resales and
Trading through Automated Linkages market (the "Portal Market") and (ii) permit
the Notes to be eligible for clearance and settlement through The Depository
Trust Company.
(l) In connection with Notes offered and sold in an off shore
transaction (as defined in Regulation S) the Company will not register any
transfer of such Notes not made in accordance with the provisions of Regulation
S and will not, except in accordance with the provisions of Regulation S, if
applicable, issue any such Notes in the form of definitive securities.
6. Expenses. The Company agrees to pay all costs and expenses incident
to the performance of its obligations under this Agreement, whether or not the
transactions contemplated herein are consummated or this Agreement is terminated
pursuant to Section 11 hereof, including all costs and expenses incident to (i)
the printing, word processing or other production of documents with respect to
the transactions contemplated hereby, including any costs of printing the
Preliminary Memorandum and the Final Memorandum and any amendment or supplement
thereto, and any "Blue Sky" memoranda, (ii) all arrangements relating to the
delivery to the Initial Purchasers of copies of the foregoing documents, (iii)
the fees and disbursements of the counsel, the accountants and any other experts
or advisors retained by the Company, (iv) preparation (including printing),
issuance and delivery to the Initial Purchasers of the Notes, (v) the
qualification of the Notes under state securities and "Blue Sky" laws, including
filing fees and fees and disbursements of counsel for the Initial Purchasers
relating thereto, (vi) expenses in connection with any meetings with prospective
investors in the Notes, (vii) fees and expenses of the Trustee including fees
and expenses of counsel, (viii) all expenses and listing fees incurred in
connection with the application for quotation of the Notes on the PORTAL Market
and (ix) any fees charged by investment rating agencies
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for the rating of the Notes. If the sale of the Notes provided for herein is not
consummated because any condition to the obligations of the Initial Purchasers
set forth in Section 7 hereof is not satisfied, because this Agreement is
terminated pursuant to paragraphs (i), (ii) or (v) of Section 11(a) hereof or
because of any failure, refusal or inability on the part of the Company to
perform all obligations and satisfy all conditions on their part to be performed
or satisfied hereunder (other than solely by reason of a default by the Initial
Purchasers of their obligations hereunder after all conditions hereunder have
been satisfied in accordance herewith), the Company agrees to promptly reimburse
the Initial Purchasers upon demand for all out-of-pocket expenses (including
fees, disbursements and charges of Xxxxxx Xxxxxx & Xxxxxxx, counsel for the
Initial Purchasers) that shall have been incurred by the Initial Purchasers in
connection with the proposed purchase and sale of the Notes.
7. Conditions of the Initial Purchasers' Obligations. The obligation
of the Initial Purchasers to purchase and pay for the Notes shall, in their sole
discretion, be subject to the satisfaction or waiver of the following conditions
on or prior to the Closing Date:
(a) On the Closing Date, the Initial Purchasers shall have received
the opinion, dated as of the Closing Date and addressed to the Initial
Purchasers, of Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P., counsel for the
Company, in form and substance satisfactory to counsel for the Initial
Purchasers, substantially to the effect that:
(i) The Company is duly incorporated, validly existing and in good
standing under the laws of Texas and has all requisite corporate power and
authority to own its properties and to conduct its business as described in
the Final Memorandum. The Company is duly qualified to do business as a
foreign corporation in good standing in all other jurisdictions where the
ownership or leasing of its properties or the conduct of its business
requires such qualification, except where the failure to be so qualified
would not, individually or in the aggregate, have a Material Adverse
Effect.
(ii) The Company has the authorized, issued and outstanding
capitalization set forth in the Final Memorandum.
(iii) To the knowledge of such counsel, except as set forth in the
Final Memorandum (A) no options, warrants or
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other rights to purchase from the Company shares of capital stock or
ownership interests in the Company are outstanding, (B) no agreements or
other obligations of the Company to issue, or other rights to convert, any
obligation into, or exchange any securities for, shares of capital stock or
ownership interests in the Company are outstanding and (C) no holder of
securities of the Company is entitled to have such securities registered
under a registration statement filed by the Company pursuant to the
Registration Rights Agreement.
(iv) The Company has all requisite corporate power and authority to
execute, deliver and perform each of its obligations under the Indenture,
the Notes, the Exchange Notes and the Private Exchange Notes; the Indenture
has been duly and validly authorized by the Company and, when duly executed
and delivered by the Company (assuming the due authorization, execution and
delivery thereof by the Trustee), will constitute the valid and legally
binding agreement of the Company, enforceable against the Company in
accordance with its terms, except that the enforcement thereof may be
subject to (i) bankruptcy, insolvency, reorganization, fraudulent
conveyance or transfer, moratorium or other similar laws now or hereafter
in effect relating to creditors' rights generally and (ii) general
principles of equity and the discretion of the court before which any
proceeding (regardless of whether brought in a proceeding in equity or at
law therefor may be brought.
(v) The Notes are in the form contemplated by the Indenture. The Notes
have each been duly and validly authorized by the Company and, when duly
executed and delivered by the Company and paid for by the Initial
Purchasers in accordance with the terms of this Agreement (assuming the due
authorization, execution and delivery of the Indenture by the Trustee and
due authentication and delivery of the Notes by the Trustee in accordance
with the Indenture), will constitute the valid and legally binding
obligations of the Company, entitled to the benefits of the Indenture, and
enforceable against the Company in accordance with their terms, except that
the enforcement thereof may be subject to (i) bankruptcy, insolvency,
reorganization, fraudulent conveyance or transfer, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
generally and (ii) general principles of equity and the discretion of the
court before which any proceeding (regardless of whether brought
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in a proceeding in equity or at law) therefor may be brought.
(vi) The Exchange Notes and the Private Exchange Notes have been duly
and validly authorized by the Company, and when the Exchange Notes and the
Private Exchange Notes have been duly executed and delivered by the Company
in accordance with the terms of the Registration Rights Agreement and the
Indenture (assuming the due authorization, execution and delivery of the
Indenture by the Trustee and due authentication and delivery of the
Exchange Notes and the Private Exchange Notes by the Trustee in accordance
with the Indenture and assuming the valid tender of the Notes pursuant to
the exchange offer as provided for in the Registration Rights Agreement),
will constitute the valid and legally binding obligations of the Company,
entitled to the benefits of the Indenture, and enforceable against the
Company in accordance with their terms, except that the enforcement thereof
may be subject to (i) bankruptcy, insolvency, reorganization, fraudulent
conveyance or transfer, moratorium or other similar laws now or hereafter
in effect relating to creditors' rights generally and (ii) general
principles of equity and the discretion of the court before which any
proceeding (regardless of whether brought in a proceeding in equity or at
law) therefor may be brought.
(vii) The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under the Registration Rights
Agreement; the Registration Rights Agreement has been duly and validly
authorized by the Company and, when duly executed and delivered by the
Company (assuming due authorization, execution and delivery thereof by the
Initial Purchasers), will constitute the valid and legally binding
agreement of the Company, enforceable against the Company in accordance
with its terms, except that (A) the enforcement thereof may be subject to
(i) bankruptcy, insolvency, reorganization, fraudulent conveyance or
transfer, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally and (ii) general principles of
equity and the discretion of the court before which any proceeding
(regardless of whether brought in a proceeding in equity or at law)
therefor may be brought and (B) any rights to indemnity or contribution
thereunder may be limited by federal and state securities laws and public
policy considerations.
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(viii) The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby; this Agreement and the
consummation by the Company of the transactions contemplated hereby have
been duly and validly authorized by the Company. This Agreement has been
duly executed and delivered by the Company.
(ix) The Indenture, the Notes and the Registration Rights Agreement
conform as to legal matters in all material respects to the descriptions
thereof contained in the Final Memorandum.
(x) To the knowledge of such counsel, no legal or governmental
proceedings are pending or threatened to which the Company is a party or to
which the property or assets of the Company is subject which, if determined
adversely to the Company would result, individually or in the aggregate, in
a Material Adverse Effect, or which seeks to restrain, enjoin, prevent the
consummation of or otherwise challenge the issuance or sale of the Notes to
be sold hereunder or the consummation of the other transactions described
in the Final Memorandum under the caption "Use of Proceeds."
(xi) To the knowledge of such counsel, the Company is not (i) in
violation of its articles of incorporation or bylaws (or similar
organizational document), (ii) to the knowledge such counsel, in breach or
violation of any statute, judgment, decree, order, rule or regulation
applicable to it or any of its properties or assets, except for any such
breach or violation which would not, individually or in the aggregate, have
a Material Adverse Effect, or (iii) in breach or default under (nor has any
event occurred which, with notice or passage of time or both, would
constitute a default under) or in violation of any of the terms or
provisions of any Contract known to such counsel and specified in such
opinion, except for any such breach, default, violation or event which
would not, individually or in the aggregate, have a Material Adverse
Effect.
(xii) The execution, delivery and performance of this Agreement, the
Indenture, the Registration Rights Agreement and the consummation of the
transactions contemplated hereby and thereby (including, without
limitation, the issuance and sale of the Notes to the Initial Purchasers)
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will not conflict with or constitute or result in a breach or a default
under (or an event which with notice or passage of time or both would
constitute a default under) or violation of any of (i) the terms or
provisions of any Contract set forth on a schedule to such opinion, except
for any such conflict, breach, violation, default or event which would not,
individually or in the aggregate, have a Material Adverse Effect, (ii) the
articles of incorporation or bylaws (or similar organizational document) of
the Company or (iii) (assuming compliance with all applicable state
securities or "Blue Sky" laws and assuming the accuracy of the
representations and warranties of the Initial Purchasers in Section 8
hereof) any Applicable Laws known to such counsel to be applicable to the
Company or any of its properties or assets, except for any such conflict,
breach or violation which would not, individually or in the aggregate, have
a Material Adverse Effect. The term "Applicable Laws" means those statutes,
judgments, rules, regulations, orders or decrees of any Governmental
Authority (as hereinafter defined) of the State of New York, the State of
Texas or of the United States of America by which the Company is bound
which, in our experience, are typically applicable to offerings of the type
contemplated by this Agreement.
(xiii) No consent, approval, authorization or order of any
governmental authority is required for the issuance and sale by the Company
of the Notes to the Initial Purchasers, except such as may be required
under Blue Sky laws, as to which such counsel need express no opinion, and
those which have previously been obtained; provided, however, that the
foregoing opinion with respect to Governmental Authorities is limited to
such consents, approvals, authorizations and orders which are required
under Applicable Laws. The term "Governmental Authority" means any
governmental, legislative, judicial, administrative or regulatory body, or
of the State of New York, the State of Texas or the United States of
America.
(xiv) To the knowledge of such counsel, the Company has obtained all
permits necessary to conduct the businesses now or proposed to be conducted
by them as described in the Final Memorandum, the lack of which would,
individually or in the aggregate, have a Material Adverse Effect; the
Company has fulfilled and performed all of its obligations with respect to
such permits and no event has occurred which allows, or after notice or
lapse of time would allow, revocation or termination thereof or results
20
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in any other material impairment of the rights of the holder of any such
permit.
(xv) To the knowledge of such counsel, the Company owns or possesses
adequate licenses or other rights to use all patents, trademarks, service
marks, trade names, copyrights and know-how necessary to conduct the
businesses now or proposed to be operated by them as described in the Final
Memorandum, and the Company has not received any notice of infringement of
or conflict with asserted rights of others with respect to any patents,
trademarks, service marks, trade names, copyrights or know-how which, if
such assertion of infringement or conflict were sustained, would have a
Material Adverse Effect.
(xvi) To the knowledge of such counsel, there are no legal or
governmental proceedings involving or affecting the Company or any of its
properties or assets which would be required to be described in a
prospectus pursuant to the Act that are not described in the Final
Memorandum, nor are there any material contracts or other documents which
would be required to be described in a prospectus pursuant to the Act that
are not described in the Final Memorandum.
(xvii) The Company is not, or immediately after the sale of the Notes
to be sold hereunder and the application of the proceeds from such sale (as
described in the Final Memorandum under the caption "Use of Proceeds") will
not be, an "investment company" as such term is defined in the Investment
Company Act of 1940, as amended.
(xviii) No registration under the Act of the Notes is required in
connection with the sale of the Notes to the Initial Purchasers as
contemplated by this Agreement and the Final Memorandum or in connection
with the initial resale of the Notes by the Initial Purchasers in
accordance with Section 8 of this Agreement, and prior to the commencement
of the Exchange Offer (as defined in the Registration Rights Agreement) or
the effectiveness of the Shelf Registration Statement (as defined in the
Registration Rights Agreement), the Indenture is not required to be
qualified under the TIA, in each case assuming, without independent
investigation, (A) that the Notes are sold to the Initial Purchasers, and
initially resold by the Initial Purchasers, in accordance with the terms
of, and in the manner contemplated by, this Agreement and the Final
Memorandum, (B) the accuracy of the representations and
21
-21-
warranties and covenants of the Company set forth in this Agreement, (C)
(1) that the purchasers who buy such Notes in the initial resale thereof
are qualified institutional buyers as defined in Rule 144A promulgated
under the Act ("QIBs") or (2) that the offer or sale of the Notes is made
in an offshore transaction as defined in Regulation S, (D) the accuracy of
the Initial Purchasers' representations in Section 8 and those of the
Company contained in this Agreement regarding the absence of a general
solicitation in connection with the sale of such Notes to the Initial
Purchasers and the initial resale thereof, (E) the due performance by the
Company of the covenants and agreements set forth in this Agreement and the
due performance by the Initial Purchasers of the covenants and agreements
set forth in this Agreement, (F) the Initial Purchasers' compliance with
the offering and transfer procedures and restrictions described in the
Final Memorandum, (G) the accuracy of the representations and warranties
deemed to have been made in accordance with this Agreement and the Final
Memorandum by purchasers to whom the Initial Purchasers initially resell
the Notes and (H) that each purchaser to whom the Initial Purchasers
initially resell Notes receives a copy of the Final Memorandum if requested
by such purchaser prior to such sale.
(xix) Neither the consummation of the transactions contemplated by
this Agreement nor the sale, issuance, execution or delivery of the Notes
will violate Regulation G, T, U or X of the Board of Governors of the
Federal Reserve System.
At the time the foregoing opinion is delivered, Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P. shall additionally state that it has participated in
conferences with officers and other representatives of the Company,
representatives of the independent public accountants for the Company,
representatives of the Initial Purchasers and counsel for the Initial
Purchasers, at which conferences the contents of the Final Memorandum and
related matters were discussed, and, although it has not independently verified
and is not passing upon and assumes no responsibility for the accuracy,
completeness or fairness of the statements contained in the Final Memorandum
(except to the extent specified in subsection 7(a)(ix)), no facts have come to
its attention which lead it to believe that the Final Memorandum, on the date
thereof or at the Closing Date, 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 contained therein, in light of the circumstances
22
-22-
under which they were made, not misleading (it being understood that such firm
need express no opinion with respect to the financial statements and related
notes thereto and the other financial, statistical and accounting data included
in the Final Memorandum). The opinion of Akin, Gump, Strauss, Xxxxx & Xxxx,
L.L.P. described in this Section shall be rendered to the Initial Purchasers at
the request of the Company and shall so state therein.
References to the Final Memorandum in this subsection (a) shall
include any amendment or supplement thereto prepared in accordance with the
provisions of this Agreement at the Closing Date.
(b) On the Closing Date, the Initial Purchasers shall have received
the opinion, in form and substance satisfactory to the Initial Purchasers, dated
as of the Closing Date and addressed to the Initial Purchasers, of Xxxxxx Xxxxxx
& Xxxxxxx, counsel for the Initial Purchasers, with respect to certain legal
matters relating to this Agreement and such other related matters as the Initial
Purchasers may reasonably require. In rendering such opinion, Xxxxxx Xxxxxx &
Xxxxxxx shall have received and may rely upon such certificates and other
documents and information as it may reasonably request to pass upon such
matters.
(c) The Initial Purchasers shall have received from the Independent
Accountants a comfort letter or letters dated the date hereof and the Closing
Date, in form and substance satisfactory to counsel for the Initial Purchasers.
(d) The representations and warranties of the Company contained in
this Agreement shall be true and correct in all material respects on and as of
the date hereof and on and as of the Closing Date as if made on and as of the
Closing Date; the statements of the Company's officers made pursuant to any
certificate delivered in accordance with the provisions hereof shall be true and
correct on and as of the date made and on and as of the Closing Date; the
Company shall have performed all covenants and agreements and satisfied all
conditions on their part to be performed or satisfied hereunder at or prior to
the Closing Date; and, except as described in the Final Memorandum (exclusive of
any amendment or supplement thereto after the date hereof), subsequent to the
date of the most recent financial statements in such Final Memorandum, there
shall have been no event or development, and no information shall have become
known, that, individually or in the aggregate, has
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or would be reasonably likely to have a Material Adverse Effect.
(e) The sale of the Notes hereunder shall not be enjoined (temporarily
or permanently) on the Closing Date.
(f) Subsequent to the date of the most recent financial statements in
the Final Memorandum (exclusive of any amendment or supplement thereto after the
date hereof), the Company shall not have sustained any loss or interference with
respect to its business or properties from fire, flood, hurricane, accident or
other calamity, whether or not covered by insurance, or from any strike, labor
dispute, slow down or work stoppage or from any legal or governmental
proceeding, order or decree, which loss or interference, individually or in the
aggregate, has or would be reasonably likely to have a Material Adverse Effect.
(g) The Initial Purchasers shall have received a certificate of the
Company, dated the Closing Date, signed on behalf of the Company by its Chairman
of the Board, President or any Senior Vice President and the Chief Financial
Officer, to the effect that:
(i) The representations and warranties of the Company contained in
this Agreement are true and correct on and as of the date hereof and on and
as of the Closing Date, and the Company has performed all covenants and
agreements and satisfied all conditions on its part to be performed or
satisfied hereunder at or prior to the Closing Date;
(ii) At the Closing Date, since the date hereof or since the date of
the most recent financial statements in the Final Memorandum (exclusive of
any amendment or supplement thereto after the date hereof), no event or
development has occurred, and no information has become known, that,
individually or in the aggregate, has or would be reasonably likely to have
a Material Adverse Effect; and
(iii) The sale of the Notes hereunder has not been enjoined
(temporarily or permanently).
(h) On the Closing Date, the Initial Purchasers shall have received
the Registration Rights Agreement executed by the Company and such agreement
shall be in full force and effect at all times from and after the Closing Date.
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(i) The Initial Purchasers shall have received a letter dated the
Closing Date delivered by Houlihan, Lokey, Xxxxxx & Zukin Financial Advisors,
Inc. in form and substance satisfactory to the Initial Purchasers, with
appropriate attachments (and with a separate certificate of the chief financial
officer of the Company), stating that, after giving effect to the Transactions,
the fair saleable value of the assets of the Company is not less than the
probable liability on their debts, that the Company is able to pay its debts as
they mature and that the Company does not have unreasonably small capital to
conduct its business.
(j) All conditions with respect to the closing of the Revolving Credit
Facility shall have been met and such closing shall have occurred and no default
or event of default under the Revolving Credit Facility shall have occurred or
be continuing.
(k) All conditions with respect to the Stock Purchase and Redemption
Agreement shall have been met and such closing shall have occurred, including
the purchase by FWT Acquisition of 108.98 shares of Common Stock from the
Existing Shareholders for $36 million.
On or before the Closing Date, the Initial Purchasers and counsel for
the Initial Purchasers shall have received such further documents, opinions,
certificates, letters and schedules or instruments relating to the business,
corporate, legal and financial affairs of the Company as they shall have
heretofore reasonably requested from the Company.
All such documents, opinions, certificates, letters, schedules or
instruments delivered pursuant to this Agreement will comply with the provisions
hereof only if they are reasonably satisfactory in all material respects to the
Initial Purchasers and counsel for the Initial Purchasers. The Company shall
furnish to the Initial Purchasers such conformed copies of such documents,
opinions, certificates, letters, schedules and instruments in such quantities as
the Initial Purchasers shall reasonably request.
8. Offering of Notes; Restrictions on Transfer. (a) Each of the
Initial Purchasers represents and warrants (as to itself only) that it is a QIB.
Each of the Initial Purchasers agrees with the Company (as to itself only) that
(i) it has not and will not solicit offers for, or offer or sell, the Notes by
any form of general solicitation or general advertising (as those terms are used
in Regulation D under the Act) or
25
-25-
in any manner involving a public offering within the meaning of Section 4(2) of
the Act; and (ii) it has and will solicit offers for the Notes only from, and
will offer the Notes only to (A) in the case of offers inside the United States,
persons whom the Initial Purchasers reasonably believe to be QIBs or, if any
such person is buying for one or more institutional accounts for which such
person is acting as fiduciary or agent, only when such person has represented to
the Initial Purchasers that each such account is a QIB, to whom notice has been
given that such sale or delivery is being made in reliance on Rule 144A, and, in
each case, in transactions under Rule 144A and (B) in the case of offers outside
the United States, to persons other than U.S. persons ("foreign purchasers,"
which term shall include dealers or other professional fiduciaries in the United
States acting on a discretionary basis for foreign beneficial owners (other than
an estate or trust)); provided, however, that, in the case of this clause (B),
in purchasing such Notes such persons are deemed to have represented and agreed
as provided under the caption "Transfer Restrictions" contained in the Final
Memorandum (or, if the Final Memorandum is not in existence, in the most recent
Memorandum).
(b) Each of the Initial Purchasers represents and warrants (as to
itself only) with respect to offers and sales outside the United States that (i)
it has and will comply with all applicable laws and regulations in each
jurisdiction in which it acquires, offers, sells or delivers Notes or has in its
possession or distributes any Memorandum or any such other material, in all
cases at its own expense; (ii) the Notes have not been and will not be offered
or sold within the United States or to, or for the account or benefit of, U.S.
persons except in accordance with Regulation S under the Act or pursuant to an
exemption from the registration requirements of the Act; (iii) it has offered
the Notes and will offer and sell the Notes (A) as part of its distribution at
any time and (B) otherwise until 40 days after the later of the commencement of
the offering and the Closing Date, only in accordance with Rule 903 of
Regulation S and, accordingly, neither it nor any persons acting on its behalf
have engaged or will engage in any directed selling efforts (within the meaning
of Regulation S) with respect to the Notes, and any such persons have complied
and will comply with the offering restrictions requirement of Regulation S; and
(iv) it agrees that, at or prior to confirmation of sales of the Notes, it will
have sent to each distributor, dealer or person receiving a selling concession,
fee or other remuneration that purchases Notes from it during the restricted
period a confirmation or notice to substantially the following effect:
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-26-
"The Securities covered hereby have not been registered
under the United States Securities Act of 1933 (the
"Securities Act") and may not be offered and sold within the
United States or to, or for the account or benefit of, U.S.
persons (i) as part of the distribution of the Securities at
any time or (ii) otherwise until 40 days after the later of
the commencement of the offering and the closing date of the
offering, except in either case in accordance with
Regulation S (or Rule 144A if available) under the
Securities Act. Terms used above have the meaning given to
them in Regulation S."
Terms used in this Section 8 and not defined in this Agreement have
the meanings given to them in Regulation S.
9. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless the Initial Purchasers, and each person, if any, who
controls any Initial Purchaser within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, against any losses, claims, damages or
liabilities to which any Initial Purchaser or such controlling person may become
subject under the Act, the Exchange Act or otherwise, insofar as any such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon:
(i) any untrue statement or alleged untrue statement of any material
fact contained in any Memorandum or any amendment or supplement thereto or
any application or other document, or any amendment or supplement thereto,
executed by the Company or based upon written information furnished by or
on behalf of the Company filed in any jurisdiction in order to qualify the
Notes under the securities or "Blue Sky" laws thereof or filed with any
securities association or securities exchange (each an "Application"); or
(ii) the omission or alleged omission to state, in any Memorandum or
any amendment or supplement thereto or any Application, a material fact
required to be stated therein or necessary to make the statements therein
not misleading,
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-27-
and will reimburse, as incurred, the Initial Purchasers and each such
controlling person for any legal or other expenses incurred by the Initial
Purchasers or such controlling person in connection with investigating,
defending against or appearing as a third-party witness in connection with any
such loss, claim, damage, liability or action; provided, however, the Company
will not be liable in any such case to the extent that any such loss, claim,
damage, or liability arises out of or is based upon any untrue statement or
alleged untrue statement or omission or alleged omission made in any Memorandum
or any amendment or supplement thereto or any application in reliance upon and
in conformity with written information concerning the Initial Purchasers
furnished to the Company by the Initial Purchasers specifically for use therein;
provided, further, that the foregoing indemnity with respect to the Preliminary
Memorandum shall not inure to the benefit of any Initial Purchaser (or to the
benefit of any person controlling such Initial Purchaser) from whom the person
asserting any such losses, claims, damages or liabilities purchased Notes if
such untrue statement or omission or alleged untrue statement or omission made
in the Preliminary Memorandum is eliminated or remedied in the Final Memorandum
(as amended or supplemented if the Company shall have furnished any amendments
or supplements thereto to such Initial Purchaser prior to confirmation of the
sale of such Notes to such person by such Initial Purchaser) and a copy of the
Final Memorandum as so amended or supplemented if the Company shall have
furnished any amendments or supplements thereto to such Initial Purchaser prior
to confirmation the sale of such Notes to such person by such Initial Purchaser)
and a copy of the Final Memorandum (as so amended or supplemented) shall not
have been furnished to such person at or prior to the written confirmation of
the sale of such Notes to such person, unless such failure to deliver was a
result of non-compliance by the Company with Section 5(a) or 5(c), and the
claims asserted by such person do not include allegations of other untrue
statements or omissions of material facts made in the Final Memorandum, which
allegations are upheld in a final judgment. This indemnity agreement will be in
addition to any liability that the Company may otherwise have to the indemnified
parties. The Company shall not be liable under this Section 9 for any settlement
of any claim or action effected without its prior written consent, which shall
not be unreasonably withheld.
(b) The Initial Purchasers agree to indemnify and hold harmless the
Company, its directors, its officers and each person, if any, who controls the
Company within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act against any losses, claims, damages or liabilities to which the
Company
28
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or any such director, officer or controlling person may become subject under the
Act, the Exchange Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon (i)
any untrue statement or alleged untrue statement of any material fact contained
in any Memorandum or any amendment or supplement thereto or any Application, or
(ii) the omission or the alleged omission to state therein a material fact
required to be stated in any Memorandum or any amendment or supplement thereto
or any Application, or necessary to make the statements therein not misleading,
in each case to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with written information concerning such Initial
Purchaser, furnished to the Company by the Initial Purchasers specifically for
use therein; and subject to the limitation set forth immediately preceding this
clause, will reimburse, as incurred, any legal or other expenses incurred by the
Company or any such director, officer or controlling person in connection with
investigating or defending against or appearing as a third party witness in
connection with any such loss, claim, damage, liability or action in respect
thereof. This indemnity agreement will be in addition to any liability that the
Initial Purchasers may otherwise have to the indemnified parties. The Initial
Purchasers shall not be liable under this Section 9 for any settlement of any
claim or action effected without their consent, which shall not be unreasonably
withheld. The Company shall not, without the prior written consent of the
Initial Purchasers, effect any settlement or compromise of any pending or
threatened proceeding in respect of which any Initial Purchaser is or could have
been a party, or indemnity could have been sought hereunder by any Initial
Purchaser, unless such settlement (A) includes an unconditional written release
of the Initial Purchasers, in form and substance reasonably satisfactory to the
Initial Purchasers, from all liability on claims that are the subject matter of
such proceeding and (B) does not include any statement as to an admission of
fault, culpability or failure to act by or on behalf of any Initial Purchaser.
(c) Promptly after receipt by an indemnified party under this Section
9 of notice of the commencement of any action for which such indemnified party
is entitled to indemnification under this Section 9, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 9, notify the indemnifying party of the commencement thereof
in writing; but the omission to so notify the indemnifying party (i) will not
relieve it from any liability under paragraph (a) or (b) above unless and to the
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extent such failure results in the forfeiture by the indemnifying party of
substantial rights and defenses and (ii) will not, in any event, relieve the
indemnifying party from any obligations to any indemnified party other than the
indemnification obligation provided in paragraphs (a) and (b) above. In case any
such action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party;
provided, however, that if (i) the use of counsel chosen by the indemnifying
party to represent the indemnified party would present such counsel with a
conflict of interest, (ii) the defendants in any such action include both the
indemnified party and the indemnifying party and the indemnified party shall
have been advised by counsel that there may be one or more legal defenses
available to it and/or other indemnified parties that are different from or
additional to those available to the indemnifying party, or (iii) the
indemnifying party shall not have employed counsel reasonably satisfactory to
the indemnified party to represent the indemnified party within a reasonable
time after receipt by the indemnifying party of notice of the institution of
such action, then, in each such case, the indemnifying party shall not have the
right to direct the defense of such action on behalf of such indemnified party
or parties and such indemnified party or parties shall have the right to select
separate counsel to defend such action on behalf of such indemnified party or
parties. After notice from the indemnifying party to such indemnified party of
its election so to assume the defense thereof and approval by such indemnified
party of counsel appointed to defend such action, the indemnifying party will
not be liable to such indemnified party under this Section 9 for any legal or
other expenses, other than reasonable costs of investigation, subsequently
incurred by such indemnified party in connection with the defense thereof,
unless (i) the indemnified party shall have employed separate counsel in
accordance with the proviso to the immediately preceding sentence (it being
understood, however, that in connection with such action the indemnifying party
shall not be liable for the expenses of more than one separate counsel (in
addition to local counsel) in any one action or separate but substantially
similar actions in the same jurisdiction arising out of the same general
allegations or circumstances, designated by the Initial Purchasers in the case
of paragraph (a) of this Section 9 or the Company in the case of paragraph (b)
of this Section 9, representing the indemnified parties under such paragraph (a)
or paragraph (b), as the case may be, who are
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parties to such action or actions) or (ii) the indemnifying party has authorized
in writing the employment of counsel for the indemnified party at the expense of
the indemnifying party. After such notice from the indemnifying party to such
indemnified party, the indemnifying party will not be liable for the costs and
expenses of any settlement of such action effected by such indemnified party
without the prior written consent of the indemnifying party (which consent shall
not be unreasonably withheld), unless such indemnified party waived in writing
its rights under this Section 9, in which case the indemnified party may effect
such a settlement without such consent.
(d) In circumstances in which the indemnity agreement provided for in
the preceding paragraphs of this Section 9 is unavailable to, or insufficient to
hold harmless, an indemnified party in respect of any losses, claims, damages or
liabilities (or actions in respect thereof), each indemnifying party, in order
to provide for just and equitable contribution, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages or liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect (i) the relative benefits received by the indemnifying
party or parties on the one hand and the indemnified party on the other from the
offering of the Notes or (ii) if the allocation provided by the foregoing clause
(i) is not permitted by applicable law, not only such relative benefits but also
the relative fault of the indemnifying party or parties on the one hand and the
indemnified party on the other in connection with the statements or omissions or
alleged statements or omissions that resulted in such losses, claims, damages or
liabilities (or actions in respect thereof). The relative benefits received by
the Company on the one hand and any Initial Purchaser on the other shall be
deemed to be in the same proportion as the total proceeds from the offering
(before deducting expenses) received by the Company bear to the total discounts
and commissions received by such Initial Purchaser. The relative fault of the
parties shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company
on the one hand, or such Initial Purchaser on the other, the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission or alleged statement or omission, and any other
equitable considerations appropriate in the circumstances. The Company and the
Initial Purchasers agree that it would not be equitable if the amount of such
contribution were determined by pro rata or per capita allocation or by
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any other method of allocation that does not take into account the equitable
considerations referred to in the first sentence of this paragraph (d).
Notwithstanding any other provision of this paragraph (d), no Initial Purchaser
shall be obligated to make contributions hereunder that in the aggregate exceed
the total discounts, commissions and other compensation received by such Initial
Purchaser under this Agreement, less the aggregate amount of any damages that
such Initial Purchaser has otherwise been required to pay by reason of the
untrue or alleged untrue statements or the omissions or alleged omissions to
state a material fact, and no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this paragraph (d), each person, if any, who
controls an Initial Purchaser within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act shall have the same rights to contribution as the
Initial Purchasers, and each director of the Company, each officer of the
Company and each person, if any, who controls the Company within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, shall have the same
rights to contribution as the Company.
10. Survival Clause. The respective representations, warranties,
agreements, covenants, indemnities and other statements of the Company, its
officers and the Initial Purchasers set forth in this Agreement or made by or on
behalf of them pursuant to this Agreement shall remain in full force and effect,
regardless of (i) any investigation made by or on behalf of the Company, any of
its officers or directors, the Initial Purchasers or any controlling person
referred to in Section 9 hereof and (ii) delivery of and payment for the Notes.
The respective agreements, covenants, indemnities and other statements set forth
in Sections 6, 9 and 15 hereof shall remain in full force and effect, regardless
of any termination or cancellation of this Agreement.
11. Termination. (a) This Agreement may be terminated in the sole
discretion of the Initial Purchasers by notice to the Company given prior to the
Closing Date in the event that the Company shall have failed, refused or been
unable to perform all obligations and satisfy all conditions on its part to be
performed or satisfied hereunder at or prior thereto or, if at or prior to the
Closing Date:
(i) the Company shall have sustained any loss or interference with
respect to its businesses or properties from fire, flood, hurricane,
accident or other calamity,
32
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whether or not covered by insurance, or from any strike, labor dispute,
slow down or work stoppage or any legal or governmental proceeding, which
loss or interference, in the sole judgment of the Initial Purchasers, has
had or has a Material Adverse Effect, or there shall have been, in the sole
judgment of the Initial Purchasers, any event or development that,
individually or in the aggregate, has or could be reasonably likely to have
a Material Adverse Effect (including without limitation a change in control
of the Company), except in each case as described in the Final Memorandum
(exclusive of any amendment or supplement thereto);
(ii) trading in securities of the Company or in securities generally
on the New York Stock Exchange, American Stock Exchange or the NASDAQ
National Market shall have been suspended or minimum or maximum prices
shall have been established on any such exchange or market;
(iii) a banking moratorium shall have been declared by New York or
United States authorities;
(iv) there shall have been (A) an outbreak or escalation of
hostilities between the United States and any foreign power, or (B) an
outbreak or escalation of any other insurrection or armed conflict
involving the United States or any other national or international calamity
or emergency, or (C) any material change in the financial markets of the
United States which, in the case of (A), (B) or (C) above and in the sole
judgment of the Initial Purchasers, makes it impracticable or inadvisable
to proceed with the offering or the delivery of the Notes as contemplated
by the Final Memorandum; or
(v) any securities of the Company shall have been downgraded or placed
on any "watch list" for possible downgrading by any nationally recognized
statistical rating organization.
(b) Termination of this Agreement pursuant to this Section 11 shall be
without liability of any party to any other party except as provided in Section
10 hereof.
12. Information Supplied by the Initial Purchasers. The statements set
forth in the last paragraph on the front cover page, the first paragraph of page
i, in the second and third sentences of the third paragraph and the sixth and
seventh paragraphs under the heading "Private Placement" in the
33
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Final Memorandum (to the extent such statements relate to the Initial
Purchasers) constitute the only information furnished by the Initial Purchasers
to the Company for the purposes of Sections 2(a) and 9 hereof.
13. Notices. All communications hereunder shall be in writing and, if
sent to the Initial Purchasers, shall be mailed or delivered to (i) BT Alex.
Xxxxx Incorporated, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Corporate Finance Department; if sent to the Company, shall be mailed or
delivered to the Company at 0000 Xxxx Xxxx 000 Xxxxx, Xxxx Xxxxx, Xxxxx
00000-0000, Attention: Xxx X. Xxxxx; with a copy to Akin, Gump, Strauss, Xxxxx &
Xxxx, L.L.P., 0000 Xxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxx 00000-0000,
Attention: Xxxxxxxxxxx X. Xxxxx, P.C.
All such notices and communications shall be deemed to have been duly
given: when delivered by hand, if personally delivered; five business days after
being deposited in the mail, postage prepaid, if mailed; and one business day
after being timely delivered to a next-day air courier.
14. Successors. This Agreement shall inure to the benefit of and be
binding upon the Initial Purchasers, the Company and their respective successors
and legal representatives, and nothing expressed or mentioned in this Agreement
is intended or shall be construed to give any other person any legal or
equitable right, remedy or claim under or in respect of this Agreement, or any
provisions herein contained; this Agreement and all conditions and provisions
hereof being intended to be and being for the sole and exclusive benefit of such
persons and for the benefit of no other person except that (i) the indemnities
of the Company contained in Section 9 of this Agreement shall also be for the
benefit of any person or persons who control the Initial Purchasers within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act and (ii) the
indemnities of the Initial Purchasers contained in Section 9 of this Agreement
shall also be for the benefit of the directors of the Company, its officers and
any person or persons who control the Company within the meaning of Section 15
of the Act or Section 20 of the Exchange Act. No purchaser of Notes from the
Initial Purchasers will be deemed a successor because of such purchase.
15. APPLICABLE LAW. THE VALIDITY AND INTERPRETATION OF THIS AGREEMENT,
AND THE TERMS AND CONDITIONS SET FORTH HEREIN SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS
MADE
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AND TO BE PERFORMED WHOLLY THEREIN, WITHOUT GIVING EFFECT TO ANY PROVISIONS
THEREOF RELATING TO CONFLICTS OF LAW.
16. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
35
S-1
If the foregoing correctly sets forth our understanding, please
indicate your acceptance thereof in the space provided below for that purpose,
whereupon this letter shall constitute a binding agreement between the Company
and the Initial Purchasers.
Very truly yours,
FWT, INC.
By:
----------------------------------
Name:
Title:
The foregoing Agreement is hereby
confirmed and accepted as of the date
first above written.
BT ALEX. XXXXX INCORPORATED
By:
------------------------------
Name:
Title:
SBC WARBURG DILLON READ INC.
By:
------------------------------
Name:
Title:
By:
------------------------------
Name:
Title:
XXXXX XXXXXX INC.
By:
------------------------------
Name:
Title:
36
SCHEDULE 1
Principal
Amount of
Initial Purchaser Notes
----------------- ----------
BT Alex. Xxxxx Incorporated.......................................... $52,500,000
SBC Warburg Dillon Read Inc.......................................... 36,750,000
Xxxxx Xxxxxx Inc..................................................... 15,750,000
------------
Total...................................................... $105,000,000
37
EXHIBIT A
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