AMC ENTERTAINMENT INC.
9,000,000 Shares (1)
Common Stock
(66 2/3(cent)par value)
Underwriting Agreement
New York, New York
, 2002
Xxxxxxx Xxxxx Xxxxxx Inc.
Xxxxxxx, Xxxxx & Co.
Credit Suisse First Boston Corporation
Xxxxxx Brothers Inc.
UBS Warburg LLC
Banc of America Securities LLC
Bear, Xxxxxxx & Co, Inc.
As Representatives of the several Underwriters,
c/o Xxxxxxx Xxxxx Barney Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
AMC Entertainment Inc., a corporation organized under the laws
of Delaware (the "Company"), proposes to sell to the several underwriters named
in Schedule I hereto (the "Underwriters"), for whom you (the "Representatives")
are acting as representatives, 9,000,000 shares (the "Underwritten Securities")
of Common Stock, 66 2/3(cent) par value ("Common Stock") of the Company. The
Company also proposes to grant to the Underwriters an option to purchase up to
1,350,000 additional shares of Common Stock to cover over-allotments (the
"Option Securities"; the Option Securities, together with the Underwritten
Securities, being hereinafter called the "Securities"). To the extent there are
no additional Underwriters listed on Schedule I other than you, the term
Representatives as used herein shall mean you, as Underwriters, and the terms
Representatives and Underwriters shall mean either the singular or plural as the
context requires. The use of the neuter in this Agreement shall include the
feminine and masculine wherever appropriate. Any reference herein to the
Registration Statement, a Preliminary Prospectus or the Prospectus shall be
deemed to refer to and include the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 which were filed under the Exchange Act on or
before the Effective Date of the Registration Statement or the issue date of
such Preliminary Prospectus or the Prospectus, as the case
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(1) Plus an option to purchase from the Company up to 1,350,000
additional Securities to cover over-allotments.
may be; and any reference herein to the terms "amend", "amendment" or
"supplement" with respect to the Registration Statement, any Preliminary
Prospectus or the Prospectus shall be deemed to refer to and include the filing
of any document under the Exchange Act after the Effective Date of the
Registration Statement, or the issue date of any Preliminary Prospectus or the
Prospectus, as the case may be, deemed to be incorporated therein by reference.
Certain terms used herein are defined in Section 17 hereof.
1. REPRESENTATIONS AND WARRANTIES.
(i) The Company represents and warrants to each Underwriter as
set forth below in this Section 1.
(a) The Company meets the requirements for use of Form S-3
under the Act and has prepared and filed with the Commission a
registration statement (file number 333-75208) on Form S-3, including a
related preliminary prospectus, for registration under the Act of the
offering and sale of the Securities. The Company may have filed one or
more amendments thereto, including a related preliminary prospectus,
each of which has previously been furnished to you. The Company will
next file with the Commission one of the following: either (1) prior to
the Effective Date of such registration statement, a further amendment
to such registration statement, (including the form of final
prospectus) or (2) after the Effective Date of such registration
statement, a final prospectus in accordance with Rules 430A and 424(b).
In the case of clause (2), the Company has included in such
registration statement, as amended at the Effective Date, all
information (other than Rule 430A Information) required by the Act and
the rules thereunder to be included in such registration statement and
the Prospectus. As filed, such amendment and form of final prospectus,
or such final prospectus, shall contain all Rule 430A Information,
together with all other such required information, and, except to the
extent the Representatives shall agree in writing to a modification,
shall be in all substantive respects in the form furnished to you prior
to the Execution Time or, to the extent not completed at the Execution
Time, shall contain only such specific additional information and other
changes (beyond that contained in the latest Preliminary Prospectus) as
the Company has advised you, prior to the Execution Time, will be
included or made therein.
(b) On the Effective Date, the Registration Statement did or
will, and when the Prospectus is first filed (if required) in
accordance with Rule 424(b) and on the Closing Date (as defined herein)
and on any date on which Option Securities are purchased, if such date
is not the Closing Date (a "settlement date"), the Prospectus (and any
supplements thereto) will, comply in all material respects with the
applicable requirements of the Act and the Exchange Act and the
respective rules thereunder; on the Effective Date and at the Execution
Time, the Registration Statement did not or will not contain any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the
statements therein not misleading; and, on the Effective Date, the
Prospectus, if not filed pursuant to Rule 424(b), will not, and
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on the date of any filing pursuant to Rule 424(b) and on the Closing
Date and any settlement date, the Prospectus (together with any
supplement thereto) will not, include any untrue statement of a
material fact or omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading; PROVIDED, HOWEVER, that the
Company makes no representations or warranties as to the information
contained in or omitted from the Registration Statement or the
Prospectus (or any supplement thereto) in reliance upon and in
conformity with information furnished in writing to the Company by or
on behalf of any Underwriter through the Representatives specifically
for inclusion in the Registration Statement or the Prospectus (or any
supplement thereto);
(c) Neither the Company nor any of its subsidiaries has
sustained since the date of the latest audited financial statements
included in the Prospectus any material loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus, and, since the respective dates as of
which information is given in the Prospectus, there has not been any
change in the capital stock or long-term debt of the Company or any of
its subsidiaries (other than borrowings in the ordinary course of
business under the Company's existing credit facility (the "Credit
Facility")), or any material adverse change, or any development which
would reasonably be expected to have a material adverse change, in or
affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries, taken as a whole, otherwise than as set forth or
contemplated in the Prospectus;
(d) Each of the Company and each of its subsidiaries owns or
leases all such properties as are necessary to the conduct of its
operations as presently conducted. The Company and its subsidiaries
have good and marketable title in fee simple to all real property and
good and marketable title to all personal property owned by them, in
each case free and clear of all liens, encumbrances and defects except
such as are described in the Prospectus or such as do not materially
affect the value of such property and do not interfere with the use
made and proposed to be made of such property by the Company and its
subsidiaries; and any real property and buildings held under lease by
the Company and its subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the use made and proposed to be made
of such property and buildings by the Company and its subsidiaries;
(e) Each of the Company and each of its subsidiaries has been
duly incorporated and is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation,
respectively, with requisite corporate power and authority to own its
properties and conduct its business as described in the Prospectus, and
has been duly qualified as a foreign corporation for the
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transaction of business and is in good standing under the laws of each
other jurisdiction in which it owns or leases properties or conducts
any business so as to require such qualification, except where the
failure to be so duly qualified as a foreign corporation or in good
standing under the laws of such jurisdiction would not reasonably be
expected to have a Material Adverse Effect;
(f) All of the issued shares of capital stock of the Company
have been duly and validly authorized and issued and are fully paid and
non-assessable; and all of the issued shares of capital stock of each
subsidiary of the Company have been duly and validly authorized and
issued, are fully paid and non-assessable and (except for directors'
qualifying shares and except as otherwise set forth in the Prospectus)
are owned directly or indirectly by the Company, free and clear of all
liens, encumbrances, equities or claims other than those of the lenders
under the Credit Facility. American Multi Cinema, Inc. ("AMC") and AMC
Entertainment International Inc. ("AMCEI") are the only subsidiaries of
the Company that are "significant subsidiaries" within the meaning of
Rule 1-02 under Regulation S-X;
(g) The Company's authorized equity capitalization is as set
forth in the Prospectus and consists of 200,000,000 shares of common
stock, par value 66-2/3(cent) per share; 30,000,000 shares of Class B
stock, par value 66-2/3(cent) per share; and 10,000,000 shares of
preferred stock, par value 66-2/3(cent) per share, of which 2,000,000
shares have been designated under the Company's certificate of
designations as Series A Convertible Preferred Stock and 2,000,000
shares have been designated as Series B Exchangeable Preferred Stock;
the capital stock of the Company conforms in all material respects to
the description thereof contained in the Prospectus;
(h) The outstanding shares of Common Stock have been duly and
validly authorized and issued and are fully paid and nonassessable; the
Securities being sold hereunder by the Company have been duly and
validly authorized, and, when issued and delivered to and paid for by
the Underwriters pursuant to this Agreement, will be fully paid and
nonassessable; the Securities being sold hereunder by the Company are
duly listed, and admitted and authorized for trading on the American
Stock Exchange; the certificates for the Securities are in valid and
sufficient form; the holders of outstanding shares of capital stock of
the Company are not entitled to preemptive or other rights to subscribe
for the Securities arising by operation of law, under the certificate
of incorporation or bylaws of the Company or under any agreement to
which the Company is a party; and, except as set forth in the
Prospectus, no options, warrants or other rights to purchase,
agreements or other obligations to issue, or rights to convert any
obligations into or exchange any securities for, shares of capital
stock of or ownership interests in the Company are outstanding, in each
case to the extent issued, granted or entered into by the Company;
(i) This Agreement has been duly authorized, executed and
delivered by the Company and constitutes a valid and binding obligation
of the Company
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enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency and similar laws affecting creditors' rights and
subject to general principles of equity;
(j) The issue and sale of the Securities and the compliance by
the Company with all of the provisions of the Securities and this
Agreement and the consummation of the transactions herein contemplated
will not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its subsidiaries is a party
or by which the Company or any of its subsidiaries is bound or to which
any of the property or assets of the Company or any of its subsidiaries
is subject, nor will such action result in any violation of the
provisions of the Certificate of Incorporation or By-laws of the
Company or any of its subsidiaries or any statute or any order, rule or
regulation of any court or governmental or regulatory agency, body or
authority ("Governmental Agency") having jurisdiction over the Company
or any of its subsidiaries or any of their properties; and no consent,
approval, authorization, order, registration or qualification
("Governmental Authorization") of or with any Governmental Agency is
required for the issue and sale of the Securities or the consummation
by the Company of the transactions contemplated by this Agreement,
except for such Governmental Authorizations as may be required under
state securities or blue sky laws in connection with the purchase and
resale of the Securities by the Underwriters in the manner contemplated
herein and in the Registration Statement and Prospectus;
(k) Neither the Company nor any of its subsidiaries is (i) in
violation of (A) its Certificate of Incorporation or By-laws or (B) any
statute, order, rule or regulation (including those relating to the
protection of human health and safety, the environment or hazardous or
toxic substances or wastes, pollutants or contaminants) of any
Governmental Agency having jurisdiction over the Company or any of its
subsidiaries or any of their properties, except where such violations
would not, individually or in the aggregate, reasonably be expected to
have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company
and its subsidiaries, taken as a whole ("Material Adverse Effect"), or
(ii) in default in the performance or observance of any obligation,
agreement, covenant or condition contained in any indenture, mortgage,
deed of trust, loan agreement, lease or other agreement or instrument
to which it is a party or by which it or any of its properties may be
bound, except where such default would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect;
(k) The statements set forth in the Prospectus under the
captions "Description of Capital Stock", insofar as they purport to
constitute a summary of the terms of the Securities, the description of
the Company's credit facility and indentures with respect to
outstanding notes in "Management's Discussion and Analysis of Financial
Condition and Results of Operations-Liquidity and Capital
5
Resources," "Proposed Acquisition of GC Companies," "Our
Management--Certain Relationships and Related Transactions," "Shares
Eligible for Future Sale" and "Underwriting," insofar as they purport
to describe the provisions of the laws and documents referred to
therein, provide an accurate and fair description thereof in all
material respects;
(l) Other than as set forth in the Prospectus, there are no
legal or governmental proceedings pending to which the Company or any
of its subsidiaries is a party or of which any property of the Company
or any of its subsidiaries is the subject which, if determined
adversely to the Company or any of its subsidiaries (i) would,
individually or in the aggregate, reasonably be expected to have a
material adverse effect on the performance of this Agreement by the
Company, or the consummation by the Company of any of the transactions
contemplated hereby; or (ii) would, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect, whether or
not arising from transactions in the ordinary course of business,
except as set forth in or contemplated in the Prospectus (exclusive of
any amendment or supplement thereto); and, to the best of the Company's
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(m) No holders of securities of the Company have rights to the
registration of such securities under the Registration Statement except
such rights as have been validly and irrevocably waived;
(n) The consolidated historical financial statements and
schedules of the Company and its consolidated subsidiaries included in
the Prospectus and the Registration Statement present fairly in all
material respects the financial condition, results of operations and
cash flows of the Company as of the dates and for the periods
indicated, comply as to form with the applicable accounting
requirements of the Act and have been prepared in conformity with
generally accepted accounting principles applied on a consistent basis
throughout the periods involved (except as otherwise noted therein);
the selected financial data set forth under the captions
"Summary-Summary Financial and Operating Data" and "Selected Financial
and Operating Data" in the Prospectus and Registration Statement fairly
present, on the basis stated in the Prospectus, the information
included therein; the pro forma financial statements included in the
Prospectus under the captions "Summary-Summary Pro Forma Financial
Data" and "AMC Entertainment Inc. Unaudited Condensed Pro Forma
Financial Statements" include assumptions that provide a reasonable
basis for presenting the significant effects directly attributable to
the transactions and events described therein, the related pro forma
adjustments give appropriate effect to those assumptions, and the pro
forma adjustments reflect the proper application of those adjustments
to the historical financial statement amounts in the pro forma
financial statements included in the Prospectus; except as specifically
set forth therein, the pro forma financial statements included in the
Prospectus comply as to form in all material respects with the
applicable accounting requirements of Regulation S-X under the
6
Act; and the pro forma adjustments have been properly applied to the
historical amounts in the compilation of those statements;
(o) The Company and each of its subsidiaries have all
licenses, franchises, permits, authorizations, approvals and orders and
other concessions of and from all Governmental Agencies that are
necessary to own or lease their other properties and conduct their
businesses as described in the Prospectus, except where the failure to
have such licenses, franchises, permits, authorizations approvals or
orders would not individually or in the aggregate have a Material
Adverse Effect; and neither the Company nor any such subsidiary has
received any notice of proceedings relating to the revocation or
modification of any such certificate, authorization or permit which,
singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would have a Material Adverse Effect, whether or not
arising from transactions in the ordinary course of business, except as
set forth in or contemplated in the Prospectus (exclusive of any
amendment or supplement thereto);
(p) There is no franchise, contract or other document of a
character required to be described in the Registration Statement or
Prospectus, or to be filed as an exhibit thereto, which is not
described or filed as required;
(q) There are no stamp or other issuance or transfer taxes or
duties or other similar fees or charges required to be paid in
connection with the execution and delivery of this Agreement or the
issuance or sale by the Company of the Securities;
(r) The Company has filed all foreign, federal, state and
local tax returns that are required to be filed or has requested
extensions thereof (except in any case in which the failure so to file
would not have a Material Adverse Effect, whether or not arising from
transactions in the ordinary course of business, except as set forth in
or contemplated in the Prospectus (exclusive of any amendment or
supplement thereto)), and has paid all taxes required to be paid by it
and any other assessment, fine or penalty levied against it, to the
extent that any of the foregoing is due and payable, except for any
such assessment, fine or penalty that is currently being contested in
good faith or as would not have a Material Adverse Effect, whether or
not arising from transactions in the ordinary course of business,
except as set forth in or contemplated in the Prospectus (exclusive of
any amendment or supplement thereto);
(s) No labor problem or dispute with the employees of the
Company or any of its subsidiaries exists or, to the Company's
knowledge, is threatened or imminent, and the Company is not aware of
any existing or imminent labor disturbance by the employees of any of
its or its subsidiaries' principal suppliers, contractors or customers,
that in each case would reasonably be expected to have a Material
Adverse Effect, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated in
the
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Prospectus (exclusive of any amendment or supplement thereto);
(t) The Company and each of its subsidiaries are insured by
insurers of recognized financial responsibility against such losses and
risks and in such amounts and subject to such self-insurance retentions
as are prudent and customary in the businesses in which they are
engaged; all policies of insurance and fidelity or surety bonds
insuring the Company or any of its subsidiaries or their respective
businesses, assets, employees, officers and directors are in full force
and effect; the Company and its subsidiaries are in compliance with the
terms of such policies and instruments in all material respects; and
there are no claims by the Company or any of its subsidiaries under any
such policy or instrument as to which any insurance company is denying
liability or defending under a reservation of rights clause; since the
end of the Company's most recent fiscal year, neither the Company nor
any such subsidiary has been refused any insurance coverage sought or
applied for; and since the end of the Company's most recent fiscal
year, neither the Company nor any such subsidiary has any reason to
believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar
coverage from similar insurers as may be necessary to continue its
business at a cost that would not reasonably be expected to have a
Material Adverse Effect, whether or not arising from transactions in
the ordinary course of business, except as set forth in or contemplated
in the Prospectus (exclusive of any amendment or supplement thereto);
(u) No subsidiary of the Company is currently prohibited,
directly or indirectly, from paying any dividends to the Company, from
making any other distribution on such subsidiary's capital stock, from
repaying to the Company any loans or advances to such subsidiary from
the Company or from transferring any of such subsidiary's property or
assets to the Company or any other subsidiary of the Company, except as
described in or contemplated by the Prospectus (exclusive of any
amendment or supplement thereto);
(v) The Company and each of its subsidiaries maintain a system
of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with
management's general or specific authorizations; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain asset accountability; (iii) access to assets is permitted only
in accordance with management's general or specific authorization; and
(iv) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is taken
with respect to any differences;
(w) Prior to the date hereof, neither the Company nor any of
its subsidiaries or affiliates has taken, directly or indirectly, any
action which is designed to or which has constituted or which might
have been expected to cause
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or result, under the Exchange Act or otherwise, in stabilization or
manipulation of the price of any security of the Company in connection
with the offering of the Securities or to facilitate the sale or resale
of the Securities;
(x) The Company is subject to and in full compliance with the
reporting requirements of Section 13 or 15(d) of the Exchange Act;
(y) The Company is not, and after giving effect to the
offering and sale of the Securities and the application of the proceeds
thereof 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 United States Investment Company Act;
(z) Neither the Company nor any of its affiliates does
business with the government of Cuba or with any person or affiliate
located in Cuba within the meaning of Section 517.075, Florida
Statutes;
(aa) PricewaterhouseCoopers LLP, who have certified certain
financial statements of the Company and its subsidiaries and who have
delivered their report with respect to the audited consolidated
financial statements included in the Prospectus, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder;
(bb) The Stock Purchase Agreement, dated as of January 15,
2002, among GC Companies, Inc. ("GC"), as seller, and the Company, AMC
and Centertainment Development, Inc., collectively as purchasers (the
"GC Acquisition Agreement") has been duly authorized, executed and
delivered by each of the Company and, to the Company's knowledge, GC
and, to the extent and subject to the limitations and conditions stated
therein (including any requisite approvals of the Bankruptcy court),
constitute the legal, valid and binding obligations of the Company and
GC enforceable against each of them in accordance with their terms,
subject, as to enforcement, to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles; the Company has all requisite corporate power and
authority to execute, deliver and perform its obligations pursuant to
each of the GC Acquisition Agreements. The representations and
warranties of the Company contained in the GC Acquisition Agreement are
true and correct and, to the Company's knowledge, the representations
and warranties of GC contained in the GC Acquisition Agreement are true
and correct;
(cc) The execution and delivery by the Company of each of the
GC Acquisition Agreement and the compliance by the Company with all its
obligations thereunder and the consummation of the transactions therein
contemplated will not conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute a default under,
any indenture, mortgage,
9
deed of trust, loan agreement or other agreement or instrument to which
the Company or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries is bound or to which any of the
property or assets of the Company or any of its subsidiaries is
subject, nor will such action result in any violation of the provisions
of the Certificate of Incorporation or By-laws of the Company or any of
its subsidiaries or, subject to Bankruptcy Court approval and requisite
filings and expiration of any applicable waiting periods under the
Xxxx-Xxxxx-Xxxxxx Improvements Act (the "HSR Act"), any statute or any
order, rule or regulation of Governmental Agency having jurisdiction
over the Company or any of its subsidiaries or any of their properties;
and no Governmental Authorization of or with any Governmental Agency is
required for the consummation by the Company of the transactions
contemplated by the GC Acquisition Agreement, except for Bankruptcy
Court approval and as may be required under the HSR Act;
(dd) To the Company's knowledge, the consolidated historical
financial statements and schedules of GC and its subsidiaries included
in the Prospectus present fairly in all material respects the financial
condition, results of operations and cash flows of GC for the periods
indicated, comply as to form with the applicable accounting
requirements under the Act and have been prepared in conformity with
generally accepted accounting principles applied on a consistent basis
throughout the periods involved (except as otherwise noted therein);
(ee) To the Company's knowledge, other than as may have
resulted from the GC bankruptcy proceedings and seasonality of its
business, as may be contemplated by the GC plan of reorganization, or
as set forth or contemplated in the Prospectus, (i) neither GC nor any
of its subsidiaries has sustained since the date of the latest audited
financial statements included in the Prospectus any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, and (ii)
since the respective dates as of which information is given in the
Prospectus, there has not been any change in the capital stock or
long-term debt of GC or any of its subsidiaries, or any material
adverse change, or any development involving a prospective material
adverse change, in or affecting the general affairs, management,
financial position, stockholders' equity or results of operations of GC
and its subsidiaries, taken as a whole; and
(ff) To the Company's knowledge, Deloitte & Touche LLP, who
have certified the financial statements of GC Companies and its
subsidiaries included in the Prospectus, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder.
Any certificate signed by any officer of the Company and
delivered to the Representatives or counsel for the Underwriters in connection
with the offering of the Securities shall be deemed a representation and
warranty by the Company, as to matters covered thereby, to each Underwriter.
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2. PURCHASE AND SALE. (a) Subject to the terms and conditions
and in reliance upon the representations and warranties herein set forth, the
Company agrees to sell to each Underwriter, and each Underwriter agrees,
severally and not jointly, to purchase from the Company, at a purchase price of
$ per share, the amount of the Underwritten Securities set forth opposite such
Underwriter's name in Schedule I hereto.
(b) Subject to the terms and conditions and in reliance upon
the representations and warranties herein set forth, the Company hereby grants
an option to the several Underwriters to purchase, severally and not jointly, up
to 1,350,000 Option Securities at the same purchase price per share as the
Underwriters shall pay for the Underwritten Securities. Said option may be
exercised only to cover over-allotments in the sale of the Underwritten
Securities by the Underwriters. Said option may be exercised in whole or in part
at any time (but not more than once) on or before the 30th day after the date of
the Prospectus upon written or telegraphic notice by the Representatives to the
Company setting forth the number of shares of the Option Securities as to which
the several Underwriters are exercising the option and the settlement date.
The maximum number of Option Securities to be sold by the
Company is 1,350,000. In the event that the Underwriters exercise less than
their full over-allotment option, the number of Option Securities to be
purchased by each Underwriter shall be the same percentage of the total number
of shares of the Option Securities to be purchased by the several Underwriters
as such Underwriter is purchasing of the Underwritten Securities, subject to
such adjustments as you in your absolute discretion shall make to eliminate any
fractional shares.
3. DELIVERY AND PAYMENT. Delivery of and payment for the
Underwritten Securities and the Option Securities (if the option provided for
in Section 2(b) hereof shall have been exercised on or before the third
Business Day prior to the Closing Date) shall be made at 10:00 AM, New York
City time, on , 2002, or at such time on such later date not
more than three Business Days after the foregoing date as the Representatives
shall designate, which date and time may be postponed by agreement among the
Representatives and the Company or as provided in Section 9 hereof (such date
and time of delivery and payment for the Securities being herein called the
"Closing Date"). Delivery of the Securities shall be made to the
Representatives for the respective accounts of the several Underwriters
against payment by the several Underwriters through the Representatives of
the respective aggregate purchase prices of the Securities being sold by the
Company to or upon the order of the Company by wire transfer payable in
same-day funds to the account or accounts specified by the Company. Delivery
of the Underwritten Securities and the Option Securities shall be made
through the facilities of The Depository Trust Company unless the
Representatives shall otherwise instruct.
If the option provided for in Section 2(b) hereof is exercised
after the third Business Day prior to the Closing Date, the Company will deliver
the Option Securities (at the expense of the Company) to the Representatives at
Xxxxxxx Xxxxx Barney Inc., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, xx the date
specified by the
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Representatives (which shall be within three Business Days after exercise of
said option) for the respective accounts of the several Underwriters, against
payment by the several Underwriters through the Representatives of the purchase
price thereof to or upon the order of the Company by wire transfer payable in
same-day funds to the account or accounts specified by the Company. If
settlement for the Option Securities occurs after the Closing Date, the Company
will deliver to the Representatives on the settlement date for the Option
Securities, and the obligation of the Underwriters to purchase the Option
Securities shall be conditioned upon receipt of, supplemental opinions,
certificates and letters confirming as of such date the opinions, certificates
and letters delivered on the Closing Date pursuant to Section 6 hereof.
4. OFFERING BY UNDERWRITERS. It is understood that the several
Underwriters propose to offer the Securities for sale to the public as set forth
in the Prospectus.
5. AGREEMENTS.
(i) The Company agrees with the several Underwriters that:
(a) The Company will use its best efforts to cause the
Registration Statement, if not effective at the Execution Time, and any
amendment thereof, to become effective. Prior to the termination of the
offering of the Securities, the Company will not file any amendment of
the Registration Statement or supplement to the Prospectus or any Rule
462(b) Registration Statement unless the Company has furnished you a
copy for your review prior to filing and will not file any such
proposed amendment or supplement to which you reasonably object.
Subject to the foregoing sentence, if the Registration Statement has
become or becomes effective pursuant to Rule 430A, or filing of the
Prospectus is otherwise required under Rule 424(b), the Company will
cause the Prospectus, properly completed, and any supplement thereto to
be filed with the Commission pursuant to the applicable paragraph of
Rule 424(b) within the time period prescribed and will provide evidence
satisfactory to the Representatives of such timely filing. The Company
will promptly advise the Representatives (1) when the Registration
Statement, if not effective at the Execution Time, shall have become
effective, (2) when the Prospectus, and any supplement thereto, shall
have been filed (if required) with the Commission pursuant to Rule
424(b) or when any Rule 462(b) Registration Statement shall have been
filed with the Commission, (3) when, prior to termination of the
offering of the Securities, any amendment to the Registration Statement
shall have been filed or become effective, (4) of any request by the
Commission or its staff for any amendment of the Registration
Statement, or any Rule 462(b) Registration Statement, or for any
supplement to the Prospectus or for any additional information, (5) of
the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the institution or
threatening of any proceeding for that purpose and (6) of the receipt
by the Company of any notification with respect to the suspension of
the qualification of the Securities for sale in any jurisdiction or the
institution or threatening of any
12
proceeding for such purpose. The Company will use its best efforts to
prevent the issuance of any such stop order or the suspension of any
such qualification and, if issued, to obtain as soon as possible the
withdrawal thereof.
(b) If, at any time when a prospectus relating to the
Securities is required to be delivered under the Act, any event occurs
as a result of which the Prospectus as then supplemented would include
any untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein in the light of the
circumstances under which they were made not misleading, or if it shall
be necessary to amend the Registration Statement or supplement the
Prospectus to comply with the Act or the Exchange Act or the respective
rules thereunder, the Company promptly will (1) notify the
Representatives of such event, (2) prepare and file with the
Commission, subject to the second sentence of paragraph (i)(a) of this
Section 5, an amendment or supplement which will correct such statement
or omission or effect such compliance and (3) supply any supplemented
Prospectus to you in such quantities as you may reasonably request.
(c) As soon as practicable, the Company will make generally
available to its security holders and to the Representatives an
earnings statement or statements of the Company and its subsidiaries
which will satisfy the provisions of Section 11(a) of the Act and Rule
158 under the Act.
(d) The Company will furnish to the Representatives and
counsel for the Underwriters, without charge, signed copies of the
Registration Statement (including exhibits thereto) and to each other
Underwriter a copy of the Registration Statement (without exhibits
thereto) and, so long as delivery of a prospectus by an Underwriter or
dealer may be required by the Act, as many copies of each Preliminary
Prospectus and the Prospectus and any supplement thereto as the
Representatives may reasonably request. The Company will pay the
expenses of printing or other production of all documents relating to
the offering.
(e) The Company will arrange, if necessary, for the
qualification of the Securities for sale under the laws of such
jurisdictions as the Representatives may designate, will maintain such
qualifications in effect so long as required for the distribution of
the Securities and will pay any fee of the National Association of
Securities Dealers, Inc., in connection with its review of the
offering; provided that in no event shall the Company be obligated to
qualify to do business in any jurisdiction where it is not now so
qualified or to take any action that would subject it to service of
process in suits, other than those arising out of the offering or sale
of the Securities, in any jurisdiction where it is not now so subject.
(f) The Company will not, without the prior written consent of
Xxxxxxx Xxxxx Xxxxxx Inc., offer, sell, contract to sell, pledge, or
otherwise dispose of (or enter into any transaction which is designed
to, or would reasonably be expected to, result in the disposition
(whether by actual disposition or effective economic
13
disposition due to cash settlement or otherwise) by the Company or any
affiliate of the Company or any person in privity with the Company or
any affiliate of the Company) directly or indirectly, including the
filing (or participation in the filing) of a registration statement
(other than a registration statement on Form S-8) with the Commission
in respect of, or establish or increase a put equivalent position or
liquidate or decrease a call equivalent position within the meaning of
Section 16 of the Exchange Act, any other shares of Common Stock or any
securities convertible into, or exercisable, or exchangeable for,
shares of Common Stock; or publicly announce an intention to effect any
such transaction, for a period of 90 days after the date of the
Underwriting Agreement; provided, however, that the Company may issue
and sell Common Stock pursuant to any employee stock option plan, stock
ownership plan or dividend reinvestment plan of the Company in effect
at the Execution Time and disclosed in the Prospectus and the Company
may issue Common Stock issuable upon the conversion of securities or
the exercise of warrants outstanding at the Execution Time and
disclosed in the Prospectus and the Company may issue shares of Common
Stock offered in connection with the plan of reorganization of GC in
accordance with bankruptcy law.
(g) The Company will not take, directly or indirectly, any
action designed to or that would constitute or that would reasonably be
expected to cause or result in, under the Exchange Act or otherwise,
stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Securities.
(h) The Company agrees to pay the costs and expenses relating
to the following matters: (i) the preparation, printing or reproduction
and filing with the Commission of the Registration Statement (including
financial statements and exhibits thereto), each Preliminary
Prospectus, the Prospectus, and each amendment or supplement to any of
them; (ii) the printing (or reproduction) and delivery (including
postage, air freight charges and charges for counting and packaging) of
such copies of the Registration Statement, each Preliminary Prospectus,
the Prospectus, and all amendments or supplements to any of them, as
may, in each case, be reasonably requested for use in connection with
the offering and sale of the Securities; (iii) the preparation,
printing, authentication, issuance and delivery of certificates for the
Securities including any stamp or transfer taxes in connection with the
original issuance and sale of the Securities; (iv) the printing (or
reproduction) and delivery of this Agreement, any blue sky memorandum
and all other agreements or documents printed (or reproduced) and
delivered in connection with the offering of the Securities; (v) the
registration of the Securities under the Exchange Act and the listing
of the Securities on the American Stock Exchange; (vi) any registration
or qualification of the Securities for offer and sale under the
securities or blue sky laws of the several states (including filing
fees and the reasonable fees and expenses of counsel for the
Underwriters relating to such registration and qualification); (vii)
any filings required to be made with the National Association of
Securities Dealers, Inc. (including filing fees and the reasonable fees
and expenses of counsel for the
14
Underwriters relating to such filings); (viii) the transportation and
other expenses incurred by or on behalf of Company representatives in
connection with presentations to prospective purchasers of the
Securities; (ix) the fees and expenses of the Company's accountants and
the fees and expenses of counsel (including local and special counsel)
for the Company; and (x) all other costs and expenses incident to the
performance by the Company of its obligations hereunder.
6. CONDITIONS TO THE OBLIGATIONS OF THE UNDERWRITERS. The
obligations of the Underwriters to purchase the Underwritten Securities and the
Option Securities, as the case may be, shall be subject to the accuracy of the
representations and warranties on the part of the Company contained herein as of
the Execution Time, the Closing Date and any settlement date pursuant to Section
3 hereof, to the accuracy of the statements of the Company made in any
certificates pursuant to the provisions hereof, to the performance by the
Company of its obligations hereunder and to the following additional conditions:
(a) If the Registration Statement has not become effective
prior to the Execution Time, unless the Representatives agree in
writing to a later time, the Registration Statement will become
effective not later than (i) 6:00 PM New York City time on the date of
determination of the public offering price, if such determination
occurred at or prior to 3:00 PM New York City time on such date or (ii)
9:30 AM on the Business Day following the day on which the public
offering price was determined, if such determination occurred after
3:00 PM New York City time on such date; if filing of the Prospectus,
or any supplement thereto, is required pursuant to Rule 424(b), the
Prospectus, and any such supplement, will be filed in the manner and
within the time period required by Rule 424(b); and no stop order
suspending the effectiveness of the Registration Statement shall have
been issued and no proceedings for that purpose shall have been
instituted or threatened.
(b) The Company shall have requested and caused Xxxxxxx & Xxxx
X.X., counsel for the Company, to have furnished to the Representatives
their opinion, dated the Closing Date and addressed to the
Representatives, to the effect that:
(i) The Company has been duly incorporated and is in
good standing under the laws of the State of Delaware, with
requisite corporate power and authority to own its properties
and conduct its business as described in the Prospectus;
(ii) The Company's authorized equity capitalization
is as set forth in the Prospectus; the capital stock of the
Company conforms in all material respects to the description
thereof contained in the Prospectus;
(iii) The outstanding shares of Common Stock have
been duly and validly authorized and issued and are fully paid
and nonassessable; the Securities being sold hereunder by the
Company have been duly and
15
validly authorized, and, when issued and delivered to and paid
for by the Underwriters pursuant to this Agreement, will be
fully paid and nonassessable; the Securities being sold
hereunder by the Company are duly listed, and admitted and
authorized for trading, subject to official notice of
issuance, on the American Stock Exchange; the certificates for
the Securities are in valid and sufficient form; the holders
of outstanding shares of capital stock of the Company are not
entitled to preemptive or other rights to subscribe for the
Securities arising by operation of law, under the certificate
of incorporation or bylaws of the Company or to such counsel's
knowledge under any agreement to which the Company is a party;
and, except as set forth in the Prospectus, to such counsel's
knowledge no options, warrants or other rights to purchase,
agreements or other obligations to issue, or rights to convert
any obligations into or exchange any securities for, shares of
capital stock of the Company, to which the Company is a party,
are outstanding;
(iv) Each of the Company and AMC has been duly
qualified as a foreign corporation for the transaction of
business and is in good standing under the laws of each
jurisdiction where the ownership, leasing or operation of
property or the conduct of its business requires such
qualification, except where the failure to be so qualified
would not reasonably be expected to have a Material Adverse
Effect, whether or not arising from transactions in the
ordinary course of business, except as disclosed in the
Prospectus;
(v) Each of AMC and AMCEI (each, a "Subsidiary" and
collectively, "Subsidiaries") has been duly incorporated and
is in good standing under the laws of its jurisdiction of
incorporation; and all of the issued shares of capital stock
of each Subsidiary have been duly authorized and validly
issued, are fully paid and non-assessable, and (except for
directors' qualifying shares and except as otherwise set forth
in the Prospectus) are owned directly or indirectly by the
Company and, to such counsel's knowledge, are free and clear
of all liens, encumbrances or claims, except for the rights of
lenders under the credit facility;
(vi) To such counsel's knowledge and other than as
set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any
of its subsidiaries is a party or of which any property of the
Company or any of its subsidiaries is the subject which, if
determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate
reasonably be expected to have a Material Adverse Effect,
whether or not arising from transactions in the ordinary
course of business, except as disclosed in the Prospectus;
and, to such counsel's knowledge, no such proceedings are
threatened by governmental authorities or by others;
16
(vii) the Registration Statement has become effective
under the Act; any required filing of the Prospectus, and any
supplements thereto, pursuant to Rule 424(b) has been made in
the manner and within the time period required by Rule 424(b);
to the knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued,
and no proceedings for that purpose have been instituted or
threatened; and the Registration Statement and the Prospectus
(other than the financial statements and related schedules and
other financial data contained therein, as to which such
counsel need express no opinion) comply as to form in all
material respects with the applicable requirements of the Act
and the Exchange Act and the respective rules thereunder;
(viii) Each of this Agreement and the GC Acquisition
Agreements has been duly authorized, executed and delivered by
the Company and, to the extent and subject to the limitations
and conditions stated therein (including any requisite
approvals of the Bankruptcy court), constitutes a valid and
legally binding instrument of the Company, enforceable against
the Company in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization,
fraudulent transfer and other laws of general applicability
relating to or affecting creditors' rights and to general
equity principles except as the enforcement of indemnification
and contribution provisions thereof may be limited by
applicable law;
(ix) The issue and sale of the Securities and the
compliance by the Company with all of the provisions of the
Securities, this Agreement and the GC Acquisition Agreement
and the consummation of the transactions herein and therein
contemplated will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute
a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument known to such
counsel to which the Company or any of its subsidiaries is a
party or by which the Company or any of its subsidiaries is
bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject, except that no opinion
need be expressed with respect to any agreement or instrument
the breach or violation of which, or default thereunder, would
not reasonably be expected to result in a Material Adverse
Effect, whether or not arising from transactions in the
ordinary course of business, except as disclosed in the
Prospectus, or adversely affect the ability of the Company to
consummate the transaction hereby or to perform its
obligations pursuant to this Agreement or under the GC
Acquisition Agreement, nor will such actions result in any
violation of the provisions of the Certificate of
Incorporation or By-laws of the Company or, subject to
required filings and the expiration of applicable waiting
periods under the HSR Act relating to the acquisition of GC,
any statute or any order, rule or regulation of any court or
governmental agency or body known to such counsel having
jurisdiction over the Company or any of its subsidiaries or
17
any of their properties (other than (except as noted above)
antitrust and state securities and blue sky laws and
regulations, as to which no opinion is expressed herein) the
violation of which would reasonably be expected to result in a
Material Adverse Effect, whether or not arising from
transactions in the ordinary course of business, except as
disclosed in the Prospectus, or adversely affect the ability
of the Company to consummate the transaction hereby or under
the GC Acquisition Agreement or to perform its obligations
pursuant to this Agreement or the GC Acquisition Agreement;
(x) The Company has all requisite corporate power and
authority, has taken all requisite corporate action, and has
received and is in compliance with all governmental, judicial
and other authorizations, approvals and orders necessary to
enter into and perform this Agreement and the GC Acquisition
Agreement, and no consent, approval, authorization, order,
registration or qualification of or with any court or
governmental agency or body having jurisdiction over the
Company is required for the issue and sale of the Securities
or the consummation by the Company of the transactions
contemplated by this Agreement or the GC Acquisition
Agreement, except, in each case, such consents, approvals,
authorizations, registrations or qualifications as may be
required under state securities or blue sky laws in connection
with the purchase and resale of the Securities by the
Underwriters and, in the case of the GC Acquisition Agreement,
the consents, approvals, authorizations, filings and the
expiration of the applicable waiting periods contemplated by
the HSR Act and those referred to in the Prospectus;
(xi) The statements set forth in the Prospectus under
the captions "Description of Capital Stock," insofar as they
purport to constitute a summary of the terms of the
Securities, the description of the Company's credit facility
and indentures with respect to outstanding notes in
"Management's Discussion and Analysis of Financial Condition
and Results of Operations-Liquidity and Capital Resources,"
"Proposed Acquisition of GC Companies," "Certain Relationships
and Related Transactions," "Shares Eligible for Future Sale"
and "Underwriting," insofar as they purport to describe the
provisions of the laws and documents referred to therein, are
accurate and fair descriptions in all material respects;
(xii) The Company is not and, after giving effect to
the offering and sale of the Securities and the application of
the 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; and
18
(xiii) The foregoing opinions may contain customary
limitations and qualifications and be limited to matters of
United States federal and Missouri state law and to matters
under the Delaware General Corporation Law, and such counsel
need express no opinion as to the effect of the laws of any
other jurisdiction; to the extent the laws of such other
jurisdiction may apply, such counsel may assume that the laws
of such jurisdiction are the same as the internal laws of the
State of Missouri. In rendering any such opinion or opinions,
in addition to other matters referred to above counsel may
rely, as to matters of fact, to the extent such counsel deems
proper, on responsible officers of the Company and public
officials. Copies of such opinions shall be delivered to the
Underwriters and counsel for the Underwriters.
Xxxxxxx & Xxxx X.X. shall additionally state that such counsel has
participated in conferences with officers and other representatives of
the Company and representatives of the independent public accountants
for the Company in connection with the preparation of the Registration
Statement and the Prospectus and has considered the matters required to
be stated therein and the statements contained therein, although such
counsel has not independently verified, and need not pass upon or
assume any responsibility for the accuracy, completeness or fairness of
the statements contained in the Registration Statement and the
Prospectus, except for those referred to in the opinion in subsection
(x) of this Section 6(a), and such counsel shall advise you that no
facts came to such counsel's attention that caused such counsel to
believe that the Registration Statement and the Prospectus and any
further amendments or supplements thereto made by the Company prior to
the Closing Date (other than the financial statements and related
schedules and other financial data therein, as to which such counsel
need express no opinion) contained as of its date or contains as of the
Closing Date an untrue statement of a material fact or omitted or
omits, as the case may be, to state a material fact necessary to make
the statements therein, in the light of the circumstances under which
they were made, not misleading.
(c) The Representatives shall have received from Weil, Gotshal
& Xxxxxx LLP, counsel for the Underwriters, such opinion or opinions,
dated the Closing Date and addressed to the Representatives, with
respect to the issuance and sale of the Securities, the Registration
Statement, the Prospectus (together with any supplement thereto) and
other related matters as the Representatives may reasonably require,
and the Company shall have furnished to such counsel such documents as
they request for the purpose of enabling them to pass upon such
matters.
(d) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the Chairman of the Board or the
President and the principal financial or accounting officer of the
Company, dated the Closing Date, to the effect that the signers of such
certificate have carefully examined the Registration Statement, the
Prospectus, any supplements to the Prospectus and
19
this Agreement and that:
(i) the representations and warranties of the Company
in this Agreement are true and correct on and as of the
Closing Date with the same effect as if made on the Closing
Date and the Company has complied with all the agreements and
satisfied all the conditions on its part to be performed or
satisfied at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of
the Registration Statement has been issued and no proceedings
for that purpose have been instituted or, to the Company's
knowledge, threatened; and
(iii) since the date of the most recent financial
statements included or incorporated by reference in the
Prospectus (exclusive of any amendment or supplement thereto),
there has been no material adverse effect on the condition
(financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the
ordinary course of business, except as set forth in or
contemplated in the Prospectus (exclusive of any amendment or
supplement thereto).
(e) At the Execution Time and at the Closing Date, the Company
shall have requested and caused PricewaterhouseCoopers LLP to furnish
to the Representatives letters, dated respectively as of the Execution
Time and as of the Closing Date, in form and substance satisfactory to
the Representatives, confirming that they are independent accountants
within the meaning of the Act and the Exchange Act and the respective
applicable rules and regulations adopted by the Commission thereunder,
that they have performed a review of the unaudited interim financial
information of the Company for the 39-week periods ended December 27,
2001 and December 28, 2000, and stating in effect that:
(i) in their opinion the audited financial statements
and financial statement schedules included or incorporated by
reference in the Registration Statement and the Prospectus and
reported on by them comply as to form in all material respects
with the applicable accounting requirements of the Act and the
Exchange Act and the related rules and regulations adopted by
the Commission;
(ii) on the basis of a reading of the latest
unaudited financial statements made available by the Company
and its subsidiaries; their limited review, in accordance with
standards established under Statement on Auditing Standards
No. 71, of the unaudited interim financial information for the
for the 39-week period ended December 27, 2001 and December
28, 2000; carrying out certain specified procedures (but not
an examination in accordance with generally accepted auditing
standards) which would not necessarily reveal matters of
significance with respect to
20
the comments set forth in such letter; a reading of the
minutes of the meetings of the stockholders, directors and
committees of the Company and its subsidiaries; and inquiries
of certain officials of the Company who have responsibility
for financial and accounting matters of the Company and its
subsidiaries as to transactions and events subsequent to March
29, 2001, nothing came to their attention which caused them to
believe that:
(1) any unaudited financial statements
included or incorporated by reference in the
Registration Statement and the Prospectus do not
comply as to form in all material respects with
applicable accounting requirements of the Act and
with the related rules and regulations adopted by the
Commission with respect to financial statements
included or incorporated by reference in quarterly
reports on Form 10-Q under the Exchange Act; and said
unaudited financial statements are not in conformity
with generally accepted accounting principles applied
on a basis substantially consistent with that of the
audited financial statements included or incorporated
by reference in the Registration Statement and the
Prospectus;
(2) with respect to the period subsequent to
December 27, 2001, there were any changes, at a
specified date not more than five days prior to the
date of the letter, in the long-term debt of the
Company and its subsidiaries or capital stock of the
Company or decreases in the stockholders' equity or
consolidated net current assets of the Company as
compared with the amounts shown on the December 27,
2001, consolidated balance sheet included or
incorporated by reference in the Registration
Statement and the Prospectus, or for the period from
December 28, 2001, to such specified date there were
any decreases, as compared with the corresponding
fiscal period in the preceding quarter in
consolidated revenues, total or per-share amounts of
earnings before extraordinary items, or of net
earnings of the Company and its subsidiaries, except
in all instances for changes or decreases set forth
in such letter, in which case the letter shall be
accompanied by an explanation by the Company as to
the significance thereof unless said explanation is
not deemed necessary by the Representatives;
(iii) they have performed certain other specified
procedures as a result of which they determined that certain
information of an accounting, financial or statistical nature
(which is limited to accounting, financial or statistical
information derived from the general accounting records of the
Company and its subsidiaries) set forth in the Prospectus,
including the information set forth under the captions
"Summary Financial and Operating Data" and "Selected Financial
and Operating Data" in the
21
Prospectus and the information included in the "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" included or incorporated in the Prospectus agrees
with the accounting records of the Company and its
subsidiaries, excluding any questions of legal interpretation;
or
(iv) on the basis of a reading of the unaudited pro
forma financial statements (the "pro forma financial
statements") included or incorporated in the Prospectus;
carrying out certain specified procedures; inquiries of
certain officials of the Company who have responsibility for
financial and accounting matters; and proving the arithmetic
accuracy of the application of the pro forma adjustments to
the historical amounts in the pro forma financial statements,
nothing came to their attention which caused them to believe
that the pro forma financial statements do not comply in form
in all material respects with the applicable accounting
requirements of Rule 11-02 of Regulation S-X or that the pro
forma adjustments have not been properly applied to the
historical amounts in the compilation of such statements.
(f) At the Execution Time and at the Closing Date, the Company
shall have requested and caused Deloitte & Touche LLP to furnish to the
Representatives letters, dated respectively as of the Execution Time
and as of the Closing Date, in form and substance satisfactory to the
Representatives, confirming that they are independent accountants
within the meaning of the Act and the Exchange Act and the applicable
rules and regulations thereunder, and stating in effect that:
(i) in their opinion the audited financial statements
and financial statement schedules of GC included or
incorporated in the Prospectus and reported on by them comply
as to form in all material respects with the applicable
accounting requirements of the Exchange Act and the related
rules and regulations adopted by the Commission thereunder;
(ii) on the basis of carrying out certain specified
procedures (but not an examination in accordance with
generally accepted auditing standards) which would not
necessarily reveal matters of significance with respect to the
comments set forth in such letter; a reading of the minutes of
the meetings of the stockholders, directors and committees of
GC and its subsidiaries; and inquiries of certain officials of
GC who have responsibility for financial and accounting
matters of GC and its subsidiaries as to transactions and
events subsequent to October 31, 2001, nothing came to their
attention which caused them to believe that:
(1) with respect to the period subsequent to
October 31, 2001, there were any changes, at a
specified date not more than
22
five days prior to the date of the letter, in the
long-term debt of GC and its subsidiaries or capital
stock of GC or decreases in the stockholders' equity
or consolidated net current assets of GC as compared
with the amounts shown on the October 31, 2001
consolidated balance sheet included or incorporated
in the Prospectus, or for the period from November 1,
2001, to such specified date there were any
decreases, as compared with the corresponding period
in the preceding quarter in consolidated revenues,
total or per-share amounts of earnings before
extraordinary items, or of net earnings of GC and its
subsidiaries, except in all instances for changes or
decreases set forth in such letter, in which case the
letter shall be accompanied by an explanation by GC
as to the significance thereof unless said
explanation is not deemed necessary by the
Representatives.
References to the Prospectus in these Sections 6(e) and (f)
include any amendment or supplement thereto at the date of the applicable
letter.
(g) Subsequent to the Execution Time or, if earlier, the dates
as of which information is given in the Registration Statement
(exclusive of any amendment thereof) and the Prospectus (exclusive of
any supplement thereto), there shall not have been (i) any change or
decrease specified in the letter or letters referred to in paragraphs
(e) and (f) of this Section 6 or (ii) any change, or any development
involving a prospective change, in or affecting the condition
(financial or otherwise), earnings, business or properties of the
Company and its subsidiaries, taken as a whole, whether or not arising
from transactions in the ordinary course of business, except as set
forth in or contemplated in the Prospectus (exclusive of any supplement
thereto) the effect of which, in any case referred to in clause (i) or
(ii) above, is, in the sole judgment of the Representatives, so
material and adverse as to make it impractical or inadvisable to
proceed with the offering or delivery of the Securities as contemplated
by the Registration Statement (exclusive of any amendment thereof) and
the Prospectus (exclusive of any supplement thereto).
(h) Prior to the Closing Date, the Company shall have
furnished to the Representatives such further information, certificates and
documents as the Representatives may reasonably request.
(i) Subsequent to the Execution Time, there shall not have
been any decrease in the rating of any of the Company's debt securities by any
"nationally recognized statistical rating organization" (as defined for purposes
of Rule 436(g) under the Act) or any notice given of any intended or potential
decrease in any such rating or of a possible change in any such rating that does
not indicate the direction of the possible change.
(j) The Securities shall have been listed and admitted and
authorized for trading on the American Stock Exchange, and satisfactory evidence
of such actions shall
23
have been provided to the Representatives.
(k) At the Execution Time, the Company shall have furnished to
the Representatives:
(i) a letter substantially in the form of Exhibit A
hereto from each officer and director of the Company, the Apollo Group
and the trustees of the Xxxxxxx Voting Trust addressed to the
Representatives; and
(ii) a letter, reasonably satisfactory in form and
substance to the Representatives, from the Apollo Group and Sandler
addressed to the Representatives, waiving their registration rights.
If any of the conditions specified in this Section 6 shall not
have been fulfilled in all material respects when and as provided in this
Agreement, or if any of the opinions and certificates mentioned above or
elsewhere in this Agreement shall not be in all material respects reasonably
satisfactory in form and substance to the Representatives and counsel for the
Underwriters, this Agreement and all obligations of the Underwriters hereunder
may be cancelled at, or at any time prior to, the Closing Date by the
Representatives. Notice of such cancellation shall be given to the Company in
writing or by telephone or facsimile confirmed in writing.
The documents required to be delivered by this Section 6 shall
be delivered at the office of Weil, Gotshal & Xxxxxx LLP, counsel for the
Underwriters, at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, on the Closing
Date.
7. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the sale of the
Securities provided for herein is not consummated because any condition to the
obligations of the Underwriters set forth in Section 6 hereof is not satisfied,
because of any termination pursuant to Section 10 hereof or because of any
refusal, inability or failure on the part of the Company to perform any
agreement herein or comply with any provision hereof other than by reason of a
default by any of the Underwriters, the Company will reimburse the Underwriters
severally through Xxxxxxx Xxxxx Barney Inc. on demand for all out-of-pocket
expenses (including reasonable fees and disbursements of counsel) that shall
have been incurred by them in connection with the proposed purchase and sale of
the Securities.
8. INDEMNIFICATION AND CONTRIBUTION. (a) The Company agrees to
indemnify and hold harmless each Underwriter, the directors, officers, employees
and agents of each Underwriter and each person who controls any Underwriter
within the meaning of either the Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several, to which they or any
of them may become subject under the Act, the Exchange Act or other Federal or
state statutory law or regulation, at common law or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the registration statement for the
24
registration of the Securities as originally filed or in any amendment thereof,
or in any Preliminary Prospectus or the Prospectus, or in any amendment thereof
or supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and agrees to reimburse
each such indemnified party, as incurred, for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action; PROVIDED, HOWEVER, that 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 such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished to
the Company by or on behalf of any Underwriter through the Representatives
specifically for inclusion therein. This indemnity agreement will be in addition
to any liability which the Company may otherwise have; PROVIDED FURTHER, that
with respect to any untrue statement or omission of material fact made in any
Preliminary Prospectus, the indemnity agreement contained in this Section 8(a)
shall not inure to the benefit of any Underwriter from whom the person asserting
any such loss, claim, damage or liability purchased the securities concerned, to
the extent that any such loss, claim, damage or liability of such Underwriter
occurs under the circumstance where it shall have been determined by a court of
competent jurisdiction by final and nonappealable judgment that (w) the Company
had previously furnished copies of the Prospectus to the Representatives, (x)
delivery of the Prospectus was required by the Act to be made to such person,
(y) the untrue statement or omission of a material fact contained in the
Preliminary Prospectus was corrected in the Prospectus and (z) there was not
sent or given to such person, at or prior to the written confirmation of the
sale of such securities to such person, a copy of the Prospectus.
(b) Each Underwriter severally and not jointly agrees to
indemnify and hold harmless the Company, each of its directors, each of its
officers who signs the Registration Statement, and each person who controls the
Company within the meaning of either the Act or the Exchange Act, to the same
extent as the foregoing indemnity to each Underwriter, but only with reference
to written information relating to such Underwriter furnished to the Company by
or on behalf of such Underwriter through the Representatives specifically for
inclusion in the documents referred to in the foregoing indemnity. This
indemnity agreement will be in addition to any liability which any Underwriter
may otherwise have. The Company acknowledges that the statements set forth in
the last paragraph of the cover page regarding delivery of the Securities and,
under the heading "Underwriting," (i) the list of Underwriters and their
respective participation in the sale of the Securities, (ii) the sentences
related to concessions and reallowances and (iii) the paragraph related to
stabilization, syndicate covering transactions and penalty bids in any
Preliminary Prospectus and the Prospectus constitute the only information
furnished in writing by or on behalf of the several Underwriters for inclusion
in any Preliminary Prospectus or the Prospectus.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 8, notify
25
the indemnifying party in writing of the commencement thereof; but the failure
so to notify the indemnifying party (i) will not relieve it from liability under
paragraph (a) or (b) above unless and to the extent it did not otherwise learn
of such action and 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 paragraph (a) or (b)
above. The indemnifying party shall be entitled to appoint counsel of the
indemnifying party's choice at the indemnifying party's expense to represent the
indemnified party in any action for which indemnification is sought (in which
case the indemnifying party shall not thereafter be responsible for the fees and
expenses of any separate counsel retained by the indemnified party or parties
except as set forth below); PROVIDED, HOWEVER, that such counsel shall be
reasonably satisfactory to the indemnified party. Notwithstanding the
indemnifying party's election to appoint counsel to represent the indemnified
party in an action, the indemnified party shall have the right to employ
separate counsel (including local counsel), and the indemnifying party shall
bear the reasonable fees, costs and expenses of such separate counsel 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 actual or
potential defendants in, or targets of, any such action include both the
indemnified party and the indemnifying party and the indemnified party shall
have reasonably concluded that there may be legal defenses available to it
and/or other indemnified parties which are different from or additional to those
available to the indemnifying party, (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 notice of the institution
of such action or (iv) the indemnifying party shall authorize the indemnified
party to employ separate counsel at the expense of the indemnifying party. An
indemnifying party will not, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding.
(d) In the event that the indemnity provided in paragraph (a)
or (b) of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company and the Underwriters severally
agree to contribute to the aggregate losses, claims, damages and liabilities
(including legal or other expenses reasonably incurred in connection with
investigating or defending same) (collectively "Losses") to which the Company
and one or more of the Underwriters may be subject in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and by the Underwriters on the other from the offering of the Securities;
PROVIDED, HOWEVER, that in no case shall any Underwriter (except as may be
provided in any agreement among underwriters relating to the offering of the
Securities) be responsible for any amount in excess of the underwriting discount
or commission
26
applicable to the Securities purchased by such Underwriter hereunder. If the
allocation provided by the immediately preceding sentence is unavailable for any
reason, the Company and the Underwriters severally shall contribute in such
proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of the Company on the one hand and of the Underwriters on the
other in connection with the statements or omissions which resulted in such
Losses as well as any other relevant equitable considerations. Benefits received
by the Company shall be deemed to be equal to the total net proceeds from the
offering (before deducting expenses) received by it, and benefits received by
the Underwriters shall be deemed to be equal to the total underwriting discounts
and commissions, in each case as set forth on the cover page of the Prospectus.
Relative fault shall be determined by reference to, among other things, whether
any untrue or any alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information provided by the
Company on the one hand or the Underwriters on the other, the intent of the
parties and their relative knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. The Company and the
Underwriters agree that it would not be just and equitable if contribution were
determined by pro rata allocation or any other method of allocation which does
not take account of the equitable considerations referred to above.
Notwithstanding the provisions of this paragraph (d), 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 Section 8, each person who
controls an Underwriter within the meaning of either the Act or the Exchange Act
and each director, officer, employee and agent of an Underwriter shall have the
same rights to contribution as such Underwriter, and each person who controls
the Company within the meaning of either the Act or the Exchange Act, each
officer of the Company who shall have signed the Registration Statement and each
director of the Company shall have the same rights to contribution as the
Company, subject in each case to the applicable terms and conditions of this
paragraph (d).
9. DEFAULT BY AN UNDERWRITER. If any one or more Underwriters
shall fail to purchase and pay for any of the Securities agreed to be purchased
by such Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the amount of Securities set
forth opposite their names in Schedule I hereto bears to the aggregate amount of
Securities set forth opposite the names of all the remaining Underwriters) the
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase; PROVIDED, HOWEVER, that in the event that the aggregate amount of
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase shall exceed 10% of the aggregate amount of Securities set forth in
Schedule I hereto, the remaining Underwriters shall have the right to purchase
all, but shall not be under any obligation to purchase any, of the Securities,
and if such nondefaulting Underwriters do not purchase all the Securities, this
Agreement will terminate without liability to any nondefaulting Underwriter or
the Company. In the event of a default by any Underwriter
27
as set forth in this Section 9, the Closing Date shall be postponed for such
period, not exceeding five Business Days, as the Representatives shall determine
in order that the required changes in the Registration Statement and the
Prospectus or in any other documents or arrangements may be effected. Nothing
contained in this Agreement shall relieve any defaulting Underwriter of its
liability, if any, to the Company and any nondefaulting Underwriter for damages
occasioned by its default hereunder.
10. TERMINATION. This Agreement shall be subject to
termination in the absolute discretion of the Representatives, by notice given
to the Company prior to delivery of and payment for the Securities, if at any
time prior to such time (i) trading in the Company's Common Stock shall have
been suspended by the Commission or the American Stock Exchange or trading in
securities generally on the New York Stock Exchange or the American Stock
Exchange shall have been suspended or limited or minimum prices shall have been
established on either of such Exchanges, (ii) a banking moratorium shall have
been declared either by Federal or New York State authorities or (iii) there
shall have occurred any outbreak or escalation of hostilities, declaration by
the United States of a national emergency or war, or other calamity or crisis
the effect of which on financial markets is such as to make it, in the sole
judgment of the Representatives, impractical or inadvisable to proceed with the
offering or delivery of the Securities as contemplated by the Prospectus
(exclusive of any supplement thereto).
11. REPRESENTATIONS AND INDEMNITIES TO SURVIVE. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers and of the Underwriters set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or the Company or any of
the officers, directors, employees, agents or controlling persons referred to in
Section 8 hereof, and will survive delivery of and payment for the Securities.
The provisions of Sections 7 and 8 hereof shall survive the termination or
cancellation of this Agreement.
12. NOTICES. All communications hereunder will be in writing
and effective only on receipt, and, if sent to the Representatives, will be
mailed, delivered or telefaxed to the Xxxxxxx Xxxxx Xxxxxx Inc. General Counsel
(fax no.: (000) 000-0000) and confirmed to the General Counsel, Xxxxxxx Xxxxx
Barney Inc., at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Attention:
General Counsel; or, if sent to the Company, will be mailed, delivered or
telefaxed to AMC Entertainment Inc. (fax no.: (000) 000-0000) and confirmed to
it at 000 Xxxx 00xx Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000-0000, attention of the
Secretary.
13. SUCCESSORS. This Agreement will inure to the benefit of
and be binding upon the parties hereto and their respective successors and the
officers, directors, employees, agents and controlling persons referred to in
Section 8 hereof, and no other person will have any right or obligation
hereunder.
14. APPLICABLE LAW. This Agreement will be governed by and
construed in accordance with the laws of the State of New York applicable to
contracts made and to
28
be performed within the State of New York.
15. COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument.
16. HEADINGS. The section headings used herein are for
convenience only and shall not affect the construction hereof.
17. DEFINITIONS. The terms which follow, when used in this
Agreement, shall have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations of the Commission promulgated thereunder.
"Apollo" shall mean Apollo Management IV, L.P. and Apollo
Management V, L.P.
"Apollo IV Purchasers" shall mean Apollo Investment Fund IV,
L.P. and Apollo Overseas Partners IV, L.P.
"Apollo V Purchasers" shall mean Apollo Investment Fund V,
L.P. and Apollo Overseas Partners V, L.P.
"Apollo Group" shall mean Apollo, the Apollo Purchasers and
certain other affiliates of Apollo that it controls.
"Apollo Purchasers" shall mean the Apollo IV Purchasers, the
Apollo V Purchasers, and any other entity over which Apollo exercises
investment authority to whom either the Apollo IV Purchasers or the
Apollo V Purchasers assign any of their interests under the Investment
Agreement.
"Business Day" shall mean any day other than a Saturday, a
Sunday or a legal holiday or a day on which banking institutions or
trust companies are authorized or obligated by law to close in New York
City.
"Commission" shall mean the Securities and Exchange
Commission.
"Effective Date" shall mean each date and time that the
Registration Statement, any post-effective amendment or amendments
thereto and any Rule 462(b) Registration Statement became or become
effective.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission promulgated
thereunder.
"Execution Time" shall mean the date and time that this
Agreement is
29
executed and delivered by the parties hereto.
"Investment Agreement" shall mean an investment agreement,
dated as of April 19, 2001, among the Company and the Apollo IV
Purchasers, the Apollo V Purchasers, Apollo Management IV, L.P., in its
capacity as investment manager to the Apollo IV Purchasers, and Apollo
Management V, L.P., in its capacity as investment manager to the Apollo
V Purchasers.
"Preliminary Prospectus" shall mean any preliminary prospectus
referred to in paragraph 1(i)(a) above and any preliminary prospectus
included in the Registration Statement at the Effective Date that omits
Rule 430A Information.
"Prospectus" shall mean the prospectus relating to the
Securities that is first filed pursuant to Rule 424(b) after the
Execution Time or, if no filing pursuant to Rule 424(b) is required,
shall mean the form of final prospectus relating to the Securities
included in the Registration Statement at the Effective Date.
"Registration Statement" shall mean the registration statement
referred to in paragraph 1(i)(a) above, including exhibits and
financial statements, as amended at the Execution Time (or, if not
effective at the Execution Time, in the form in which it shall become
effective) and, in the event any post-effective amendment thereto or
any Rule 462(b) Registration Statement becomes effective prior to the
Closing Date, shall also mean such registration statement as so amended
or such Rule 462(b) Registration Statement, as the case may be. Such
term shall include any Rule 430A Information deemed to be included
therein at the Effective Date as provided by Rule 430A.
"Rule 424", "Rule 430A" and "Rule 462" refer to such rules
under the Act.
"Rule 430A Information" shall mean information with respect to
the Securities and the offering thereof permitted to be omitted from
the Registration Statement when it becomes effective pursuant to Rule
430A.
"Rule 462(b) Registration Statement" shall mean a registration
statement and any amendments thereto filed pursuant to Rule 462(b)
relating to the offering covered by the registration statement referred
to in Section 1(a) hereof.
"Sandler" shall mean Sandler Capital Partners V, L.P., Sandler
Capital Partners V FTE, L.P. and Sandler Capital Partners V Germany,
L.P.
30
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
among the Company, the Selling Stockholder (s) and the several Underwriters.
Very truly yours,
AMC ENTERTAINMENT INC.
By: .....................
Name:
Title:
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
Xxxxxxx Xxxxx Xxxxxx Inc.
By: ............................
Name:
Title:
For itself and the other several
Underwriters named in Schedule I
to the foregoing Agreement.
31
SCHEDULE I
NUMBER OF
UNDERWRITTEN
SECURITIES TO
UNDERWRITERS BE PURCHASED
------------ ------------
Xxxxxxx Xxxxx Barney Inc.
Xxxxxxx, Xxxxx & Co.
Credit Suisse First Boston Corporation
Xxxxxx Brothers Inc.
UBS Warburg LLC
Banc of America Securities LLC
Bear, Xxxxxxx & Co. Inc.
Total ................
===============
[LETTERHEAD OF OFFICER, DIRECTOR OR MAJOR
STOCKHOLDER OF
AMC ENTERTAINMENT INC.]
AMC ENTERTAINMENT INC.
PUBLIC OFFERING OF COMMON STOCK
, 2002
Xxxxxxx Xxxxx Barney Inc.
Xxxxxxx, Xxxxx & Co.
Credit Suisse First Boston Corporation
Xxxxxx Brothers Inc.
UBS Warburg LLC
Banc of America Securities LLC
Bear, Xxxxxxx & Co. Inc.
As Representatives of the several Underwriters,
c/o Xxxxxxx Xxxxx Barney Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
This letter is being delivered to you in connection with the
proposed Underwriting Agreement (the "Underwriting Agreement"), between
AMC
Entertainment Inc., a Delaware corporation (the "Company"), and each of you as
representatives of a group of Underwriters named therein, relating to an
underwritten public offering of Common Stock, 66 2/3(cent) par value (the
"Common Stock"), of the Company.
In order to induce you and the other Underwriters to enter
into the Underwriting Agreement, the undersigned will not, without the prior
written consent of Xxxxxxx Xxxxx Xxxxxx Inc., offer, sell, contract to sell,
pledge or otherwise dispose of, (or enter into any transaction which is designed
to, or might reasonably be expected to, result in the disposition (whether by
actual disposition or effective economic disposition due to cash settlement or
otherwise) by the undersigned or any affiliate of the undersigned or any person
in privity with the undersigned or any affiliate of the undersigned), directly
or indirectly, including the filing (or participation in the filing) of a
registration statement with the Securities and Exchange Commission in respect
of, or establish or increase a put equivalent position or liquidate or decrease
a call equivalent position within the meaning of Section 16 of the Securities
Exchange Act of 1934, as amended, and the rules and regulations of the
Securities and Exchange Commission promulgated thereunder with respect to, any
shares of capital stock of the Company or any securities convertible into, or
exercisable or exchangeable for such capital stock, or publicly announce an
intention to effect any such transaction, for a period of 90 days after the date
of the Underwriting Agreement, other than shares of Common Stock disposed of as
bona fide gifts or shares of Common Stock transferred to affiliates of the
undersigned or to members of his or her immediate family or to a trust for their
benefit, provided that such affiliates, persons or trusts agree in writing with
the Representatives of the several Underwriters to be bound by the terms hereof.
If for any reason the Underwriting Agreement shall be
terminated prior to
2
the Closing Date (as defined in the Underwriting Agreement), the agreement set
forth above shall likewise be terminated.
Yours very truly,
[SIGNATURE OF OFFICER, DIRECTOR OR MAJOR
STOCKHOLDER]
[NAME AND ADDRESS OF OFFICER, DIRECTOR OR
MAJOR STOCKHOLDER]
