EXHIBIT 4.3(b)
EXECUTION COPY
SMITHFIELD FOODS, INC.
$300,000,000
8% Senior Notes due 2009
PURCHASE AGREEMENT
October 17, 2001
X.X. Xxxxxx Securities, Inc.
Xxxxxxx, Sachs & Co.
c/o X.X. Xxxxxx Securities, Inc.
000 Xxxx Xxxxxx
0xx xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Smithfield Foods, Inc., a Virginia corporation (the "Company"),
proposes to issue and sell $300,000,000 aggregate principal amount of its 8%
Senior Notes due 2009 (the "Securities"). The Securities will be issued
pursuant to an Indenture dated as of October 23, 2001 (the "Indenture") between
the Company and SunTrust Bank, Atlanta, as trustee (the "Trustee"). The Company
hereby confirms its agreement with X.X. Xxxxxx Securities, Inc. ("JPMSI") and
Xxxxxxx, Sachs & Co. ("GS", and together with JPMSI, the "Initial Purchasers")
concerning the purchase of the Securities from the Company by the Initial
Purchasers.
The Securities will be offered and sold to the Initial Purchasers
without being registered under the Securities Act of 1933, as amended (the
"Securities Act"), in reliance upon an exemption therefrom. The Company has
prepared a preliminary offering memorandum dated September 7, 2001 (including
the documents incorporated by reference therein, the "Preliminary Offering
Memorandum") and will prepare an offering memorandum dated the date hereof
(including the documents incorporated by reference therein, the "Offering
Memorandum") setting forth information concerning the Company and the
Securities. Copies of the Preliminary Offering Memorandum have been, and copies
of the Offering Memorandum will be, delivered by the Company to the Initial
Purchasers pursuant to the terms of this Agreement. Any references herein to
the Preliminary Offering Memorandum and the Offering Memorandum shall be deemed
to include all amendments and supplements thereto, unless otherwise noted. The
Company hereby confirms that it has authorized the use of the Preliminary
Offering
2
Memorandum and the Offering Memorandum in connection with the offering and
resale of the Securities by the Initial Purchasers in accordance with Section 2.
Holders of the Securities (including each Initial Purchaser and its
direct and indirect transferees) will be entitled to the benefits of an Exchange
and Registration Rights Agreement, substantially in the form attached hereto as
Annex A (the "Registration Rights Agreement"), pursuant to which the Company
will agree to file with the Securities and Exchange Commission (the
"Commission") a registration statement under the Securities Act (the "Exchange
Offer Registration Statement") registering an issue of senior notes of the
Company (the "Exchange Securities") and, under certain circumstances, a shelf
registration statement pursuant to Rule 415 under the Securities Act (the "Shelf
Registration Statement").
Capitalized terms used but not defined herein shall have the meanings
given to such terms in the Offering Memorandum.
1. Representations, Warranties and Agreements of the Company. The
Company represents and warrants to, and agrees with, the several Initial
Purchasers on and as of the date hereof and the Closing Date (as defined in
Section 3) as set forth below in this Section 1. Any reference to persons acting
on behalf of the Company, or on behalf of any of the Company's affiliates, does
not include the Initial Purchasers, with respect to whom the Company makes no
representation.
(a) Each of the Preliminary Offering Memorandum and the Offering
Memorandum, as of their respective dates, did not, and on the Closing Date
the Offering Memorandum will not, contain any untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading; provided
that the Company makes no representation or warranty as to information
contained in or omitted from the Preliminary Offering Memorandum or the
Offering Memorandum in reliance upon and in conformity with written
information relating to any Initial Purchaser furnished to the Company by
or on behalf of the Initial Purchasers specifically for use therein, (the
"Initial Purchasers' Information"), as specified in Section 15 hereof.
(b) Each of the Preliminary Offering Memorandum and the Offering
Memorandum, as of their respective dates, contains all of the information
that, if requested by a prospective purchaser of the Securities, would be
required to be provided to such prospective purchaser pursuant to Rule
144A(d)(4) under the Securities Act.
(c) Assuming the accuracy of the representations and warranties of the
Initial Purchasers contained in Section 2 and their compliance with the
agreements set forth therein, it is not necessary, in connection with the
issuance and sale of the Securities to the Initial Purchasers and the
offer, resale and delivery of the Securities by the Initial Purchasers in
the manner contemplated by this Agreement and the Offering Memorandum, to
register the Securities under the Securities Act or to qualify the
Indenture under the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act").
3
(d) The documents incorporated by reference in the Offering Memorandum
(the "Incorporated Documents"), when they were filed with the Commission,
conformed in all material respects to the requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") and the rules and
regulations of the Commission thereunder, and none of such documents
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; and any further documents so filed and
incorporated by reference in the Offering Memorandum or any further
amendment or supplement thereto, when such documents are filed with the
Commission, will conform in all material respects to the requirements of
the Exchange Act and the rules and regulations of the Commission
thereunder, and will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading. The representation and warranty
set forth in this paragraph (d) is given on the basis that any statement
contained in an Incorporated Document shall be deemed not to be contained
in the Offering Memorandum if the statement has been modified or superseded
by any statement in a subsequently filed Incorporated Document or in the
Offering Memorandum.
(e) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the Commonwealth of
Virginia, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Offering
Memorandum, and has been duly qualified as a foreign corporation for the
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, or is subject to no material
liability or disability by reason of the failure to be so qualified in any
such jurisdiction; and each of its subsidiaries listed on Schedule II
hereto (the "Subsidiaries") has been duly incorporated and is validly
existing as a corporation in good standing under the laws of its
jurisdiction of incorporation and has been duly qualified as a foreign
corporation for the 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, or is
subject to no material liability or disability by reason of the failure to
be so qualified in any such jurisdiction, except to the extent the failure
to so qualify as a foreign corporation could not reasonably be expected to
have a Material Adverse Effect (as defined below). The Company does not own
or control, directly or indirectly, any corporation, association or other
entity other than the Subsidiaries.
(f) The Company has an authorized capitalization as set forth in the
Offering Memorandum under the heading "Capitalization," and all the issued
shares of capital stock of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable; and all of the
issued shares of capital stock of each of the Subsidiaries have been duly
and validly authorized and issued, are fully paid and non-assessable and
other than as set forth or contemplated in the Offering Memorandum are
owned directly or indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims.
4
(g) The Company has full corporate power and authority to execute and
deliver this Agreement, the Indenture, the Registration Rights Agreement
and the Securities (collectively, the "Transaction Documents") and to
perform its obligations hereunder and thereunder; and all corporate,
limited liability company or limited partnership action required to be
taken for the due and proper authorization, execution and delivery of each
of the Transaction Documents and the consummation of the transactions
contemplated thereby have been duly and validly taken.
(h) This Agreement has been duly authorized, executed and delivered by
the Company and constitutes a valid and legally binding agreement of the
Company enforceable against the Company in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors'
rights generally and to general equitable principles (whether considered in
a proceeding in equity or at law) and considerations of public policy as
they relate to the enforcement of the indemnification provisions hereof.
(i) The Registration Rights Agreement has been duly authorized by the
Company and, when duly executed and delivered in accordance with its terms
by each of the parties thereto, will constitute a valid and legally binding
agreement of the Company enforceable against the Company in accordance with
its terms, subject to bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally and to general equitable principles (whether
considered in a proceeding in equity or at law) and considerations of
public policy as they relate to the enforcement of the indemnification
provisions hereof.
(j) The Indenture has been duly authorized by the Company and, when duly
executed and delivered in accordance with its terms by each of the parties
thereto, will constitute a valid and legally binding agreement of the
Company enforceable against the Company in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors'
rights generally and to general equitable principles (whether considered in
a proceeding in equity or at law). On the Closing Date, the Indenture will
conform in all material respects to the requirements of the Trust Indenture
Act and the rules and regulations of the Commission applicable to an
indenture which is qualified thereunder.
(k) The Securities have been duly authorized by the Company and, when
duly executed, authenticated, issued and delivered as provided in the
Indenture (assuming the Indenture is the valid and legally binding
obligation of the Trustee and due authentication of the Securities by the
Trustee) and paid for as provided herein, will be duly and validly issued
and outstanding and will constitute valid and legally binding obligations
of the Company, as issuer, entitled to the benefits of the Indenture and
enforceable against the Company, as issuer, in accordance with their terms,
subject to bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors'
rights generally and to general equitable principles (whether considered in
a proceeding in equity or at law).
5
(l) The Exchange Securities have been duly authorized by the Company
and, when duly executed, authenticated, issued and delivered as provided in
the Indenture and the Registration Rights Agreement (assuming the Indenture
is the valid and legally binding obligation of the Trustee and due
authentication of the Exchange Securities by the Trustee), will be duly and
validly issued and outstanding and will constitute valid and legally
binding obligations of the Company, as issuer, entitled to the benefits of
the Indenture and enforceable against the Company, as issuer, in accordance
with their terms, subject to bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally and to general equitable principles (whether
considered in a proceeding in equity or at law).
(m) Each Transaction Document conforms in all material respects to the
description thereof contained in the Offering Memorandum.
(n) The execution, delivery and performance by the Company of its
obligations under each of the Transaction Documents to which it is a party
and the issue and sale of the Securities and the Exchange Securities by the
Company and the compliance by the Company with all of the provisions of
this Agreement and the other Transaction Documents and the consummation of
the transactions contemplated herein and therein will not conflict with or
result in a breach or violation 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, except for any such
conflicts, breaches, violations or defaults that would not have a Material
Adverse Effect (as defined below), nor will such action result in any
violations of the provisions of the charter or by-laws (or other comparable
organizational documents) of the Company or any of its Subsidiaries or any
statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Company or any of its
Subsidiaries or any of their properties, except any such violation that
would not have a Material Adverse Effect; and no consent, approval,
authorization, order, registration or qualification of or with any such
court or governmental agency or body is required for the execution,
delivery and performance by the Company of its obligations under each of
the Transaction Documents to which it is a party and the issue and sale of
the Securities or the consummation by the Company of the transactions
contemplated by this Agreement and the other Transaction Documents, except
for such consents, approvals, authorizations, registrations or
qualifications (i) which shall have been obtained or made prior to the
Closing Date and as may be required to be obtained or made under the
Securities Act and applicable state securities laws, as provided in the
Registration Rights Agreement or (ii) the failure of which to be obtained
or made would not have a Material Adverse Effect.
(o) Xxxxxx Xxxxxxxx LLP ("Xxxxxx Xxxxxxxx") are independent certified
public accountants with respect to the Company and its Subsidiaries (i) as
required by the Securities Act and the rules and regulations of the
Commission thereunder and (ii) within the meaning of Rule 101 of the Code
of Professional Conduct of the American Institute of Certified Public
Accountants ("AICPA") and its interpretations and rulings thereunder.
6
The historical financial statements (including the related notes) contained
in the Offering Memorandum comply as to form in all material respects with
the applicable accounting requirements of the Securities Act and the
related published rules and regulations; such financial statements have
been prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods covered thereby and fairly
present the financial position of the entities purported to be covered
thereby at the respective dates indicated and the results of their
operations and their cash flows for the respective periods indicated; and
the financial information contained in the Offering Memorandum under the
headings "Summary--Summary Consolidated Condensed Financial Information,"
"Capitalization," "Selected Historical Consolidated Financial Data" and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," and the financial information contained in the Company's Proxy
Statement for Annual Meeting of Shareholders dated July 30, 2001,
incorporated by reference in the Offering Memorandum, under the heading
"Executive Compensation" are derived from the accounting records of the
Company and its Subsidiaries and fairly present the information purported
to be shown thereby. The other historical financial and statistical
information and data included in the Offering Memorandum are, in all
material respects, fairly presented.
(p) Other than as set forth or contemplated in the Offering Memorandum,
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, individually or in the
aggregate would have a material adverse effect on the condition (financial
or otherwise), results of operations, business or prospects of the Company
and its Subsidiaries taken as a whole ("Material Adverse Effect"); and, to
the best of the Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others.
(q) No injunction, restraining order or order of any nature by any
federal or state court of competent jurisdiction has been issued with
respect to the Company or any of its Subsidiaries which would prevent or
suspend the issuance or sale of the Securities or the use of the
Preliminary Offering Memorandum or the Offering Memorandum in any
jurisdiction; no action, suit or proceeding is pending against or, to the
best knowledge of the Company, threatened against or affecting the Company
or any of its Subsidiaries before any court or arbitrator or any
governmental agency, body or official, domestic or foreign, which could
reasonably be expected to interfere with or adversely affect the issuance
of the Securities or in any manner draw into question the validity or
enforceability of any of the Transaction Documents or any action taken or
to be taken pursuant thereto; and the Company has complied with any and all
known requests, or any and all requests that should have been reasonably
known, by any securities authority in any jurisdiction for additional
information to be included in the Preliminary Offering Memorandum and the
Offering Memorandum.
(r) Except with respect to the matters referred to in Section 5(q),
neither the Company nor any of its Subsidiaries is (i) in violation of its
charter or by-laws (or other
7
comparable organizational documents), (ii) in default, and no event has
occurred which, with notice or lapse of time or both, would constitute such
a default, in the due performance or observance of any term, covenant or
condition contained in any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which it is a party or by
which it is bound or to which any of its property or assets is subject or
(iii) in violation in any respect of any law, ordinance, governmental rule,
regulation or court decree to which it or its property or assets may be
subject, which default under clause (ii) or violation under clause (iii)
could reasonably be expected to have a Material Adverse Effect.
(s) The Company and each of its Subsidiaries possess all material
licenses, certificates, authorizations and permits issued by, and have made
all declarations and filings with, the appropriate federal, state or
foreign regulatory agencies or bodies which are necessary or desirable for
the ownership of their respective properties or the conduct of their
respective businesses as described in the Offering Memorandum, except where
the failure to possess or make the same would not have, singularly or in
the aggregate, a Material Adverse Effect, and neither the Company nor any
of its Subsidiaries has received notification of any revocation or
modification of any such license, certificate, authorization or permit or
has any reason to believe that any such license, certificate, authorization
or permit will not be renewed in the ordinary course.
(t) The Company and each of 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
Offering Memorandum 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 materially interfere with the use made and
proposed to be made of such property and buildings by the Company and its
Subsidiaries.
(u) No material labor disturbance by or dispute with the employees of
the Company or any of its Subsidiaries exists or, to the best knowledge of
the Company, is contemplated or threatened.
(v) Other than as set forth in the Offering Memorandum, there has been
no storage, generation, transportation, handling, treatment, disposal,
discharge, emission or other release of any kind of toxic or other wastes
or other hazardous substances by, due to or caused by the Company or any of
its Subsidiaries (or, to the best knowledge of the Company, any other
entity (including any predecessor) for whose acts or omissions the Company
or any of its Subsidiaries is or could reasonably be expected to be liable)
upon any of the property now or previously owned or leased by the Company
or any of its Subsidiaries, or upon any other property (i) in violation of
any statute or any ordinance, rule, regulation, order, judgment, decree or
permit or (ii) which would, under any statute or any ordinance, rule
(including rule of common law), regulation, order, judgment,
8
decree or permit, give rise to any liability, except in the case of both
clauses (i) and (ii), for any violation or liability which could not
reasonably be expected to have, singularly or in the aggregate with all
such violations and liabilities, a Material Adverse Effect; and there has
been no disposal, discharge, emission or other release of any kind onto
such property or into the environment surrounding such property of any
toxic or other wastes or other hazardous substances with respect to which
the Company or any of its Subsidiaries has any knowledge, except for any
such disposal, discharge, emission or other release of any kind which could
not reasonably be expected to have, singularly or in the aggregate with all
such discharges and other releases, a Material Adverse Effect.
(w) None of the proceeds of the sale of the Securities will be used,
directly or indirectly, for the purpose of purchasing or carrying any
margin security, for the purpose of reducing or retiring any indebtedness
which was originally incurred to purchase or carry any margin security or
for any other purpose which might cause any of the Securities to be
considered a "purpose credit" within the meanings of Regulation T, U or X
of the Board of Governors of the Federal Reserve System.
(x) Other than this Agreement, neither the Company nor any of its
Subsidiaries is a party to any contract, agreement or understanding with
any person that would give rise to a valid claim against the Company or the
Initial Purchasers for a brokerage commission, finder's fee or like payment
in connection with the offering and sale of the Securities.
(y) None of the Company, any of its affiliates or any person acting on
its or their behalf has engaged or will engage in any directed selling
efforts (as such term is defined in Rule 902(c) of Regulation S under the
Securities Act ("Regulation S")) with respect to the Securities, and all
such persons have complied and will comply with the offering restrictions
requirement of Regulation S to the extent applicable.
(z) Neither the Company nor any of its affiliates has, directly or
through any agent, sold, offered for sale, solicited offers to buy or
otherwise negotiated in respect of, any security (as such term is defined
in the Securities Act), which is or will be integrated with the sale of the
Securities in a manner that would require registration of the Securities
under the Securities Act.
(aa) None of the Company or any of its affiliates or any other person
acting on its or their behalf has engaged, in connection with the offering
of the Securities, in any form of general solicitation or general
advertising within the meaning of Rule 502(c) under the Securities Act.
(bb) When the Securities are delivered pursuant to this Agreement, none
of the Securities will be of the same class (within the meaning of Rule
144A under the Securities Act ("Rule 144A")) as securities of the Company
that are listed on a national securities exchange registered under Section
6 of the Exchange Act, or quoted in a U.S. automated inter-dealer quotation
system.
9
(cc) The Company has not taken and will not take, directly or
indirectly, any action prohibited by Regulation M under the Exchange Act in
connection with the offering of the Securities (other than actions taken by
the Initial Purchasers, as to which the Company makes no representation).
(dd) No forward-looking statement (within the meaning of Section 27A of
the Securities Act and Section 21E of the Exchange Act) contained in the
Preliminary Offering Memorandum or the Offering Memorandum has been made or
reaffirmed without a reasonable basis or has been disclosed other than in
good faith.
(ee) Since the date as of which information is given in the Offering
Memorandum (excluding any amendment or supplement thereto or any document
incorporated by reference therein), except as otherwise stated or
contemplated therein, there has been no material adverse change or any
development involving a prospective material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs,
management or business prospects of the Company, whether or not arising in
the ordinary course of business, none of the Company or any of its
Subsidiaries has incurred any material liability or obligation, direct or
contingent, other than in the ordinary course of business and there has not
been any material change in the capital stock or long-term debt of the
Company and its Subsidiaries on a consolidated basis, or any dividend or
distribution of any kind declared, paid or made by the Company on any class
of its capital stock.
(ff) No holder of securities of the Company or any of its Subsidiaries
will be entitled to have such securities registered under the registration
statements required to be filed by the Company pursuant to the Registration
Rights Agreement, other than as expressly permitted thereby.
2. Purchase and Resale of the Securities. (a) On the basis of the
representations, warranties and agreements contained herein, and subject to the
terms and conditions set forth herein, the Company agrees to issue and sell to
the Initial Purchasers, and each Initial Purchaser, severally and not jointly,
agrees to purchase from the Company, the principal amount of Securities set
forth opposite the name of such Initial Purchaser on Schedule I hereto at a
purchase price equal to 98.75% of the principal amount thereof. The Company
shall not be obligated to deliver any of the Securities except upon payment for
all of the Securities to be purchased as provided herein.
(b) Each Initial Purchaser has advised the Company that it proposes to
offer the Securities for resale upon the terms and subject to the conditions set
forth herein and in the Offering Memorandum. Each Initial Purchaser represents
and warrants to, and agrees with, the Company that (i) it is purchasing the
Securities pursuant to a private sale exempt from registration under the
Securities Act, (ii) it has not solicited offers for, or offered or sold, and
will not solicit offers for, or offer to sell, the Securities by means of any
form of general solicitation or general advertising within the meaning of Rule
502(c) of Regulation D under the Securities Act ("Regulation D") or in any
manner involving a public offering within the meaning of Section 4(2) of the
Securities Act and (iii) it has solicited and will solicit offers for the
Securities only
10
from, and has offered or sold and will offer, sell or deliver the Securities, at
any time prior to the completion of its distribution of the Securities, only (A)
within the United States to persons whom it reasonably believes to be qualified
institutional buyers ("Qualified Institutional Buyers") as defined in Rule 144A,
or if any such person is buying for one or more institutional accounts for which
such person is acting as fiduciary or agent, only when such person has
represented to it that each such account is a Qualified Institutional Buyer to
whom notice has been given that such sale or delivery is being made in reliance
on Rule 144A and in each case, in transactions in accordance with Rule 144A and
(B) outside the United States to persons other than U.S. persons in reliance on
Regulation S.
(c) In connection with the offer and sale of Securities in reliance on
Regulation S, each Initial Purchaser, severally and not jointly, represents,
warrants and agrees that:
(i) the Securities have not been registered under the Securities Act and
may not be offered or sold within the United States or to, or for the
account or benefit of, U.S. persons except pursuant to an exemption from,
or in transactions not subject to, the registration requirements of the
Securities Act;
(ii) such Initial Purchaser has offered and sold the Securities, and
will offer and sell the Securities, (A) as part of their distribution at
any time and (B) otherwise until 40 days after the later of the
commencement of the offering of the Securities and the Closing Date, only
in accordance with Regulation S or Rule 144A or any other available
exemption from registration under the Securities Act;
(iii) none of such Initial Purchaser or any of its affiliates or any
other person acting on its or their behalf has engaged or will engage in
any directed selling efforts (as such term is defined in Regulation S) with
respect to the Securities, and all such persons have complied and will
comply with the offering restrictions requirement of Regulation S;
(iv) at or prior to the confirmation of sale of any Securities sold in
reliance on Regulation S, it will have sent to each distributor, dealer or
other person receiving a selling concession, fee or other remuneration that
purchase Securities from it during the restricted period a confirmation or
notice to substantially the following effect:
"The Securities covered hereby have not been registered under the U.S.
Securities Act of 1933, as amended (the "Securities Act"), and may not
be offered or sold within the United States or to, or for the account
or benefit of, U.S. persons (i) as part of their distribution at any
time or (ii) otherwise until 40 days after the later of the
commencement of the offering of the Securities and the date of
original issuance of the Securities, except in accordance with
Regulation S or Rule 144A or any other available exemption from
registration under the Securities Act. Terms used above have the
meanings given to them by Regulation S."; and
11
(v) it has not and will not enter into any contractual arrangement with
any distributor with respect to the distribution of the Securities, except
with its affiliates or with the prior written consent of the Company.
Terms used in this Section 2(c) have the meanings given to them by Regulation S.
(d) Each Initial Purchaser, severally and not jointly, represents, warrants
and agrees that (i) it has not offered or sold and prior to the date six months
after the Closing Date will not offer or sell any Securities to persons in the
United Kingdom except to persons whose ordinary activities involve them in
acquiring, holding, managing or disposing of investments (as principal or agent)
for the purposes of their businesses or otherwise in circumstances which have
not resulted and will not result in an offer to the public in the United Kingdom
within the meaning of the Public Offers of Securities Regulations 1995; (ii) it
has complied and will comply with all applicable provisions of the Financial
Services Xxx 0000 and the Public Offers of Securities Regulations 1995 with
respect to anything done by it in relation to the Securities in, from or
otherwise involving the United Kingdom; and (iii) it has only issued or passed
on and will only issue or pass on in the United Kingdom any document received by
it in connection with the issue of the Securities to a person who is of a kind
described in Article 11(3) of the Financial Services Xxx 0000 (Investment
Advertisements) (Exemptions) Order 1996 or is a person to whom such document may
otherwise lawfully be issued or passed on.
(e) Each Initial Purchaser, severally and not jointly, agrees that, prior
to or simultaneously with the confirmation of sale by such Initial Purchaser to
any purchaser of any of the Securities purchased by such Initial Purchasers from
the Company pursuant hereto, each Initial Purchaser shall furnish to that
purchaser a copy of the Offering Memorandum (and any amendment or supplement
thereto that the Company shall have furnished to such Initial Purchasers prior
to the date of such confirmation of sale). In addition to the foregoing, each
Initial Purchaser acknowledges and agrees that the Company and, for purposes of
the opinions to be delivered to the Initial Purchasers pursuant to Sections 5(c)
and (d), counsel for the Company and for the Initial Purchasers, respectively,
may rely upon the accuracy of the representations and warranties of each Initial
Purchaser and their compliance with their agreements contained in this Section
2, and each Initial Purchaser hereby consents to such reliance.
(f) The Company acknowledges and agrees that the Initial Purchasers may
sell Securities to any of its affiliates and that any such affiliate may sell
Securities purchased by it to an Initial Purchaser.
3. Delivery of and Payment for the Securities. (a) Delivery of and payment
for the Securities shall be made at the offices of Xxxxxxx Xxxxxxx & Xxxxxxxx,
New York, New York, or at such other place as shall be agreed upon by the
Initial Purchasers and the Company, at 9:00 A.M., New York City time, on October
23, 2001 or at such other time or date, not later than seven full business days
thereafter, as shall be agreed upon by the Initial Purchasers and the Company
(such date and time of payment and delivery being referred to herein as the
"Closing Date").
12
(b) On the Closing Date, payment of the purchase price for the Securities
shall be made to the Company by wire or book-entry transfer of same-day funds to
such account or accounts as the Company shall specify prior to the Closing Date
or by such other means as the parties hereto shall agree prior to the Closing
Date against delivery to the Initial Purchasers of the certificate(s) evidencing
the Securities. Time shall be of the essence, and delivery by the Company at the
time and place specified pursuant to this Agreement is a further condition of
the obligations of each Initial Purchaser hereunder. Upon delivery, the
Securities shall be in global form, registered in such names and in such
denominations as JPMSI on behalf of the Initial Purchasers shall have requested
in writing not less than two full business days prior to the Closing Date. The
Company agrees to make one or more global certificates evidencing the Securities
available for inspection by JPMSI on behalf of the Initial Purchasers in New
York City at least 24 hours prior to the Closing Date.
4. Further Agreements of the Company. The Company agrees with the Initial
Purchasers:
(a) at any time prior to the completion of the distribution by the
Initial Purchasers of the Securities, to advise the Initial Purchasers
promptly and, if requested, confirm such advice in writing, of the
happening of any event which makes any statement of a material fact made in
the Offering Memorandum untrue or which requires the making of any
additions to or changes (whether through incorporation by reference or
otherwise) in the Offering Memorandum (as amended or supplemented from time
to time) in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; to advise the
Initial Purchasers promptly of any order preventing or suspending the use
of the Preliminary Offering Memorandum or the Offering Memorandum, of any
suspension of the qualification of the Securities for offering or sale in
any jurisdiction and of the initiation or threatening of any proceeding for
any such purpose; and to use its best efforts to prevent the issuance of
any such order preventing or suspending the use of the Preliminary Offering
Memorandum or the Offering Memorandum or suspending any such qualification
and, if any such suspension is issued, to obtain the lifting thereof at the
earliest possible time;
(b) at any time prior to the completion of the distribution by the
Initial Purchasers of the Securities, to furnish promptly to each of the
Initial Purchasers and counsel for the Initial Purchasers, without charge,
as many copies of the Preliminary Offering Memorandum and the Offering
Memorandum (and any amendments or supplements thereto) as may be reasonably
requested;
(c) prior to making any amendment or supplement to the Offering
Memorandum, to furnish a copy thereof to each of the Initial Purchasers and
counsel for the Initial Purchasers and not to effect any such amendment or
supplement to which the Initial Purchasers shall reasonably object by
notice to the Company after a reasonable period to review;
(d) if, at any time prior to completion of the resale of the Securities
by the Initial Purchasers, any event shall occur or condition exist as a
result of which it is necessary, in
13
the opinion of counsel for the Initial Purchasers or counsel for the
Company, to amend or supplement (whether through incorporation by reference
or otherwise) the Offering Memorandum in order that the Offering Memorandum
will not include an 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 existing at the time it is delivered to a
purchaser, not misleading, or if it is necessary to amend or supplement
(whether through incorporation by reference or otherwise) the Offering
Memorandum to comply with applicable law, to promptly prepare such
amendment or supplement as may be necessary to correct such untrue
statement or omission or so that the Offering Memorandum, as so amended or
supplemented, will comply with applicable law;
(e) for so long as the Securities are outstanding and are "restricted
securities" within the meaning of Rule 144(a)(3) under the Securities Act,
to furnish to holders of the Securities and prospective purchasers of the
Securities designated by such holders, upon request of such holders or such
prospective purchasers, the information required to be delivered pursuant
to Rule 144A(d)(4) under the Securities Act, unless the Company is then
subject to and in compliance with Section 13 or 15(d) of the Exchange Act
(the foregoing agreement being for the benefit of the holders from time to
time of the Securities and prospective purchasers of the Securities
designated by such holders);
(f) unless such reports are available through the Commission's XXXXX
system, for so long as the Securities are outstanding, to furnish to the
Initial Purchasers copies of any annual reports, quarterly reports and
current reports filed by the Company with the Commission on Forms 10-K, 10-
Q and 8-K, or such other similar forms as may be designated by the
Commission, and such other documents, reports and information as shall be
furnished by the Company to the Trustee or to the holders of the Securities
pursuant to the Indenture or the Exchange Act or any rule or regulation of
the Commission thereunder;
(g) to promptly take from time to time such actions as the Initial
Purchasers may reasonably request to qualify the Securities for offering
and sale by the Initial Purchasers under the securities or Blue Sky laws of
such jurisdictions as the Initial Purchasers may designate and to continue
such qualifications in effect for so long as required for the resale of the
Securities; and to arrange for the determination of the eligibility for
investment of the Securities under the laws of such jurisdictions as the
Initial Purchasers may reasonably request; provided that neither the
Company nor any of its Subsidiaries shall be obligated to qualify as a
foreign corporation in any jurisdiction in which it is not so qualified or
to file a general consent to service of process in any jurisdiction or
subject itself to taxation in excess of a nominal dollar amount in any such
jurisdiction where it is not then so subject;
(h) to assist the Initial Purchasers in arranging for the Securities to
be designated Private Offerings, Resales and Trading through Automated
Linkages ("PORTAL") Market securities in accordance with the rules and
regulations adopted by the National Association of Securities Dealers, Inc.
("NASD") relating to trading in the PORTAL
14
Market and for the Securities to be eligible for clearance and settlement
through The Depository Trust Company ("DTC");
(i) not to, and to cause its affiliates not to, sell, offer for sale or
solicit offers to buy or otherwise negotiate in respect of any security (as
such term is defined in the Securities Act) which could be integrated with
the sale of the Securities in a manner which would require registration of
the Securities under the Securities Act;
(j) except following the effectiveness of the Exchange Offer
Registration Statement or the Shelf Registration Statement, as the case may
be, not to, and to cause its affiliates not to, and not to authorize or
knowingly permit any person acting on their behalf to, solicit any offer to
buy or offer to sell the Securities by means of any form of general
solicitation or general advertising within the meaning of Regulation D or
in any manner involving a public offering within the meaning of Section
4(2) of the Securities Act; and not to offer, sell, contract to sell or
otherwise dispose of, directly or indirectly, any securities under
circumstances where such offer, sale, contract or disposition would cause
the exemption afforded by Section 4(2) of the Securities Act to cease to be
applicable to the offering and sale of the Securities as contemplated by
this Agreement and the Offering Memorandum;
(k) for a period of 45 days from the date of the Offering Memorandum,
not to offer for sale, sell, contract to sell or otherwise dispose of,
directly or indirectly, or file a registration statement for, or announce
any offer, sale, contract for sale of or other disposition of any debt
securities with a maturity greater than one year issued or guaranteed by
the Company or any of its Subsidiaries (other than the Securities, the
Exchange Securities or under the Revolving Credit Facilities (as defined in
the Offering Memorandum) without the prior written consent of JPMSI;
(l) during the period from the Closing Date until two years after the
Closing Date, without the prior written consent of the Initial Purchasers,
not to, and not permit any of its affiliates (as defined in Rule 144 under
the Securities Act) to, resell any of the Securities that have been
reacquired by them, except for Securities purchased by the Company or any
of its affiliates and resold in a transaction registered under the
Securities Act;
(m) not to, for so long as the Securities are outstanding, be or become,
or be or become owned by, an open-end investment company, unit investment
trust or face-amount certificate company that is or is required to be
registered under Section 8 of the Investment Company Act, and not to be or
become, or be or become owned by, a closed-end investment company required
to be registered, but not registered thereunder;
(n) in connection with the offering of the Securities, until JPMSI on
behalf of the Initial Purchasers shall have notified the Company of the
completion of the resale of the Securities, not to, and to cause its
affiliated purchasers (as defined in Regulation M under the Exchange Act)
not to, either alone or with one or more other persons, bid for or
purchase, for any account in which it or any of its affiliated purchasers
has a beneficial
15
interest, any Securities, or attempt to induce any person to purchase any
Securities; and not to, and to cause its affiliated purchasers not to, make
bids or purchase for the purpose of creating actual, or apparent active
trading in or of raising the price of the Securities;
(o) in connection with the offering of the Securities, to make its
officers, employees, independent accountants and legal counsel reasonably
available upon request by the Initial Purchasers;
(p) to do and perform all things required to be done and performed by it
under this Agreement that are within its control prior to or after the
Closing Date, and to use its reasonable best efforts to satisfy all
conditions precedent on its part to the delivery of the Securities;
(q) to not take any action prior to the execution and delivery of the
Indenture which, if taken after such execution and delivery, would have
violated any of the covenants contained in the Indenture;
(r) to not take any action prior to the Closing Date which would in the
Company's reasonable judgment require the Offering Memorandum to be amended
or supplemented pursuant to Section 4(d);
(s) prior to the Closing Date, not to issue any press release or other
public communication directly or indirectly or hold any press conference
with respect to the Company, its condition, financial or otherwise, or
earnings, business affairs or business prospects (except for routine oral
marketing communications in the ordinary course of business and consistent
with the past practices of the Company and of which the Initial Purchasers
are notified), without the prior written consent of the Initial Purchasers,
which consent may not be unreasonably withheld, unless in the judgment of
the Company and its counsel, and after notification to the Initial
Purchaser, such press release or communication is required by law; and
(t) to apply the net proceeds from the sale of the Securities as set
forth in the Offering Memorandum under the heading "Use of Proceeds."
5. Conditions of Initial Purchasers' Obligations. The respective
obligations of the several Initial Purchasers hereunder are subject to the
accuracy, on and as of the date hereof and the Closing Date, of the
representations and warranties of the Company contained herein, to the accuracy
of the statements of the Company and its officers made in any certificates
delivered pursuant hereto, to the performance by the Company of its obligations
hereunder, and to each of the following additional terms and conditions:
(a) The Offering Memorandum (and any amendments or supplements thereto)
shall have been printed and copies distributed to the Initial Purchasers as
promptly as practicable on or following the date of this Agreement or at
such other date and time as to which the Initial Purchasers may agree; and
no stop order suspending the sale of the
16
Securities in any jurisdiction shall have been issued and no proceedings
for that purpose shall have been commenced or shall be pending or
threatened.
(b) All requisite corporate, limited liability company and limited
partnership proceedings and other legal matters incident to the
authorization, form and validity of each of the Transaction Documents and
the Offering Memorandum, and all other legal matters relating to the
Transaction Documents and the transactions contemplated thereby, shall be
satisfactory in all material respects to the Initial Purchasers and the
Company shall have furnished to the Initial Purchasers all documents and
information that they or their counsel may reasonably request to enable
them to pass upon such matters.
(c) McGuireWoods LLP shall have furnished to the Initial Purchasers
their written opinion, as counsel to the Company, addressed to the Initial
Purchasers and dated the Closing Date, in form and substance reasonably
satisfactory to the Initial Purchasers, substantially to the effect set
forth in Annex B hereto.
(d) The Initial Purchasers shall have received from Xxxxxxx Xxxxxxx &
Xxxxxxxx, counsel for the Initial Purchasers, such opinion or opinions,
dated the Closing Date, with respect to such matters as the Initial
Purchasers may reasonably require, and the Company shall have furnished to
such counsel such documents and information as they reasonably request for
the purpose of enabling them to pass upon such matters.
(e) The Company shall have furnished to the Initial Purchasers a letter
(the "Initial Letter") of Xxxxxx Xxxxxxxx, addressed to the Initial
Purchasers and dated the date hereof, in form and substance reasonably
satisfactory in all material respects to the Initial Purchasers and counsel
for the Initial Purchasers.
(f) The Company shall have furnished to the Initial Purchasers a letter
(the "Bring-Down Letter") of Xxxxxx Xxxxxxxx, addressed to the Initial
Purchasers and dated the Closing Date (A) confirming that they are
independent public accountants with respect to the Company and its
Subsidiaries within the meaning of Rule 101 of the Code of Professional
Conduct of the AICPA and its interpretations and rulings thereunder, (B)
stating, as of the date of the Bring-Down Letter (or, with respect to
matters involving changes or developments since the respective dates as of
which specified financial information is given in the Offering Memorandum,
as of a date not more than three business days prior to the date of the
Bring-Down Letter), that the conclusions and findings of such accountants
with respect to the financial information and other matters covered by the
Initial Letter are accurate and (C) confirming in all material respects the
conclusions and findings set forth in the Initial Letter.
(g) The Company shall have furnished to the Initial Purchasers a
certificate, dated the Closing Date, of its Vice President, Secretary and
Treasurer, and its Vice President and Controller stating that (A) such
officers have carefully examined the Offering Memorandum, (B) in their
opinion, the Offering Memorandum, as of its date, did not include any
untrue statement of a material fact and did not omit to state a material
fact required to be stated therein or necessary in order to make the
statements therein, in the
17
light of the circumstances under which they were made, not misleading, and
since the date of the Offering Memorandum, no event has occurred which
should have been set forth in a supplement or amendment to the Offering
Memorandum (whether through incorporation by reference or otherwise) so
that the Offering Memorandum (as so amended or supplemented) would not
include any untrue statement of a material fact and would not omit to state
a material fact required to be stated therein or necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading and (C) as of the Closing Date, the
representations and warranties of the Company in this Agreement are true
and correct in all material respects, the Company has complied with all
agreements and satisfied all conditions on their part to be performed or
satisfied hereunder on or prior to the Closing Date, and subsequent to the
date of the most recent financial statements contained in the Offering
Memorandum, there has been no material adverse change in the financial
position or results of operation of the Company or any of its Subsidiaries,
or any change, or any development including a prospective change, in or
affecting the condition (financial or otherwise), results of operations,
business or prospects of the Company and its Subsidiaries taken as a whole,
except as set forth in the Offering Memorandum.
(h) The Initial Purchasers shall have received a counterpart of the
Registration Rights Agreement which shall have been executed and delivered
by a duly authorized officer of the Company.
(i) The Indenture shall have been duly executed and delivered by the
Company and the Trustee, and the Securities shall have been duly executed
and delivered by the Company and duly authenticated by the Trustee.
(j) The Securities shall have been approved by the NASD for trading in
the PORTAL Market.
(k) If any event shall have occurred that requires the Company under
Section 4(d) to prepare an amendment or supplement to the Offering
Memorandum, such amendment or supplement shall have been prepared, the
Initial Purchasers shall have been given a reasonable opportunity to
comment thereon, and copies thereof shall have been delivered to the
Initial Purchasers reasonably in advance of the Closing Date.
(l) There shall not have occurred any invalidation of Rule 144A or
Regulation S under the Securities Act by any court or any withdrawal or
proposed withdrawal of any rule or regulation under the Securities Act or
the Exchange Act by the Commission or any amendment or proposed amendment
thereof by the Commission which in the reasonable judgment of the Initial
Purchasers would materially impair the ability of the Initial Purchasers to
purchase, hold or effect resales of the Securities contemplated hereby.
(m) Subsequent to the execution and delivery of this Agreement or, if
earlier, the dates as of which information is given in the Offering
Memorandum (exclusive of any amendment or supplement thereto or document
incorporated by reference therein), there
18
shall not have been any change in the capital stock or long-term debt or
any change, or any development involving a prospective change, in or
affecting the condition (financial or otherwise), results of operations,
business or prospects of the Company and its Subsidiaries taken as a whole,
the effect of which, in any such case described above, is, in the
reasonable judgment of the Initial Purchasers, so material and adverse as
to make it impracticable or inadvisable to proceed with the sale or
delivery of the Securities on the terms and in the manner contemplated by
this Agreement and the Offering Memorandum (exclusive of any amendment or
supplement thereto or document incorporated by reference therein).
(n) No action shall have been taken and no statute, rule, regulation or
order shall have been enacted, adopted or issued by any governmental agency
or body which would, as of the Closing Date, prevent the issuance or sale
of the Securities; and no injunction, restraining order or order of any
other nature by any federal or state court of competent jurisdiction shall
have been issued as of the Closing Date which would prevent the issuance or
sale of the Securities.
(o) Subsequent to the execution and delivery of this Agreement (i) no
downgrading shall have occurred in the rating accorded the Securities or
any of the Company's other debt securities or preferred stock by any
"nationally recognized statistical rating organization", as such term is
defined by the Commission for purposes of Rule 436(g)(2) of the rules and
regulations of the Commission under the Securities Act and (ii) no such
organization shall have publicly announced that it has under surveillance
or review (other than an announcement with positive implications of a
possible upgrading), its rating of the Securities or any of the Company's
other debt securities or preferred stock.
(p) Subsequent to the execution and delivery of this Agreement there
shall not have occurred any of the following: (i) trading in securities
generally on the New York Stock Exchange, the American Stock Exchange or
the over-the-counter market shall have been suspended or limited, or
minimum prices shall have been established on any such exchange or market
by the Commission, by any such exchange or by any other regulatory body or
governmental authority having jurisdiction, or trading in any securities of
the Company on any exchange or in the over-the-counter market shall have
been suspended or (ii) any moratorium on commercial banking activities
shall have been declared by federal or New York state authorities or (iii)
an outbreak or escalation of hostilities or a declaration by the United
States of a national emergency or war or any calamity or crisis, either
within or outside the United States, or (iv) a material adverse change in
general economic, political or financial conditions or the financial
markets in the United States (or the effect of international conditions on
the financial markets in the United States shall be such), the effect of
which, in the case of clauses (iii) and (iv), is, in the reasonable
judgment of the Initial Purchasers, so material and adverse as to make it
impracticable or inadvisable to proceed with the sale or the delivery of
the Securities on the terms and in the manner contemplated by this
Agreement and in the Offering Memorandum (exclusive of any amendment or
supplement thereto or document incorporated by reference therein).
19
(q) With respect to any default, or any event which, with notice or
lapse of time or both, would constitute a default, in the due performance
or observance of any term, covenant or condition restricting the extent to
which the Company's Subsidiaries may enter into loan agreements which
prohibit the payment of dividends or the making of loans or transferring of
property to the Company or to other Subsidiaries contained in any
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument evidencing indebtedness 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 their property or assets is subject, the
Company shall have delivered to the Initial Purchasers evidence
satisfactory to the Initial Purchasers that (i) the Company has received a
written waiver (which may by its terms be effective only until a date not
earlier than December 7, 2001) of all such defaults and the aggregate
principal amount outstanding under the Subsidiary loan agreements causing
such defaults (the "Subsidiary Loan Agreements") does not exceed $75.0
million, (ii) the Company has repaid the entirety of the obligations, and
terminated any related commitments, under the Subsidiary Loan Agreements,
(iii) the Subsidiary Loan Agreements have been modified to remove the
provisions causing such defaults, (iv) any combination of the foregoing,
the result of which is that all such defaults have been cured or waived, or
(v) such defaults are otherwise cured.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to Xxxxxxx Xxxxxxx & Xxxxxxxx.
6. Termination. The obligations of the Initial Purchasers hereunder may
be terminated by the Initial Purchasers, in their sole absolute discretion, by
notice given to and received by the Company prior to delivery of and payment for
the Securities if, prior to that time, any of the events described in Section
5(l), (m), (n), (o), (p) or (q) shall have occurred and be continuing.
7. Defaulting Initial Purchaser. (a) If, on the Closing Date, any
Initial Purchaser defaults on its obligation to purchase the Securities that it
has agreed to purchase hereunder, the non-defaulting Initial Purchasers may in
their discretion arrange for the purchase of such Securities by other persons
satisfactory to the Company on the terms contained in this Agreement. If, within
36 hours after any such default by any Initial Purchaser, the non-defaulting
Initial Purchasers do not arrange for the purchase of such Securities, then the
Company shall be entitled to a further period of 36 hours within which to
procure other persons satisfactory to the non-defaulting Initial Purchasers to
purchase such Securities on such terms. If other persons become obligated or
agree to purchase the Securities of a defaulting Initial Purchaser, either the
non-defaulting Initial Purchasers or the Company may postpone the Closing Date
for up to five full Business Days in order to effect any changes that in the
opinion of counsel for the Company or counsel for the Initial Purchasers may be
necessary in the Offering Memorandum or in any other document or arrangement,
and the Company agrees to promptly prepare any amendment or supplement to the
Offering Memorandum that effects any such changes. As used in this Agreement,
the term "Initial Purchaser" includes, for all purposes of this Agreement unless
the context otherwise requires, any person not listed in Schedule I hereto
20
that, pursuant to this Section 7, purchases Securities that a defaulting Initial
Purchaser agreed but failed to purchase.
(b) If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Initial Purchaser or Initial Purchasers by the
non-defaulting Initial Purchasers and the Company as provided in paragraph
(a) above, the aggregate principal amount of such Securities that remains
unpurchased does not exceed one-eleventh of the aggregate principal amount
of all the Securities, then the Company shall have the right to require
each non-defaulting Initial Purchaser to purchase the principal amount of
Securities that such Initial Purchaser agreed to purchase hereunder plus
such Initial Purchaser's pro rata share (based on the principal amount of
Securities that such Initial Purchaser agreed to purchase hereunder) of the
Securities of such defaulting Initial Purchaser or Initial Purchasers for
which such arrangements have not been made.
(c) If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Initial Purchaser or Initial Purchasers by the
non-defaulting Initial Purchasers and the Company as provided in paragraph
(a) above, the aggregate principal amount of such Securities that remains
unpurchased exceeds one-eleventh of the aggregate principal amount of all
the Securities, or if the Company shall not exercise the right described in
paragraph (b) above, then this Agreement shall terminate without liability
on the part of the non-defaulting Initial Purchasers or the Company, except
that the Company will continue to be liable for the payment of expenses as
set forth in Section 8 and Section 12 hereof and except that the provisions
of Section 9 and Section 10 hereof shall not terminate and shall remain in
effect.
(d) Nothing contained herein shall relieve a defaulting Initial
Purchaser of any liability it may have to the Company or any non-defaulting
Initial Purchaser for damages caused by its default.
8. Reimbursement of Initial Purchasers' Expenses. If (a) this Agreement
shall have been terminated pursuant to Section 6 and Section 7, (b) the Company
shall fail to tender the Securities for delivery to the Initial Purchasers for
any reason other than by reason of a default by the Initial Purchasers or (c)
the Initial Purchasers shall decline to purchase the Securities for any reason
permitted under this Agreement, the Company shall reimburse the Initial
Purchasers for such out-of-pocket expenses (including reasonable fees and
disbursements of counsel) as shall have been reasonably incurred by the Initial
Purchasers in connection with this Agreement and the proposed purchase and
resale of the Securities.
9. Indemnification. (a) The Company shall indemnify and hold harmless
each Initial Purchaser, its affiliates, their respective officers, directors,
employees, representatives and agents, and each person, if any, who controls any
Initial Purchaser within the meaning of the Securities Act or the Exchange Act
(collectively referred to for purposes of this Section 9(a) and Section 10 as an
Initial Purchaser), from and against any loss, claim, damage or liability, joint
or several, or any action in respect thereof (including, without limitation, any
loss, claim, damage, liability or action relating to purchases and sales of the
Securities), to which that Initial Purchaser may become subject, whether
commenced or threatened, under the Securities Act, the Exchange Act, any other
federal or state statutory law or regulation, at common law or
21
otherwise, insofar as such loss, claim, damage, liability or action arises out
of, or is based upon, (i) any untrue statement or alleged untrue statement of a
material fact contained in the Preliminary Offering Memorandum or the Offering
Memorandum or in any amendment or supplement thereto or in any information
provided by the Company pursuant to Section 4(e) or (ii) the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, and shall reimburse
each Initial Purchaser promptly upon demand for any legal or other expenses
reasonably incurred by that Initial Purchaser in connection with investigating
or defending or preparing to defend against or appearing as a third party
witness in connection with any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that the Company shall not be
liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of, or is based upon, an untrue statement or
alleged untrue statement in or omission or alleged omission from any of such
documents in reliance upon and in conformity with any Initial Purchasers'
Information; and provided, further, that with respect to any such untrue
statement in or omission from the Preliminary Offering Memorandum, the indemnity
agreement contained in this Section 9(a) shall not inure to the benefit of any
such Initial Purchaser to the extent that the sale to the person asserting any
such loss, claim, damage, liability or action was an initial resale by such
Initial Purchaser and any such loss, claim, damage, liability or action of or
with respect to such Initial Purchaser results from the fact that both (A) to
the extent required by applicable law a copy of the Offering Memorandum was not
sent or given to such person at or prior to the written confirmation of the sale
of such Securities to such person and (B) the untrue statement in or omission
from the Preliminary Offering Memorandum was corrected in the Offering
Memorandum unless, in either case, such failure to deliver the Offering
Memorandum was a result of non-compliance by the Company with Section 4(b).
(b) Each Initial Purchaser shall indemnify and hold harmless the Company
and its affiliates, their respective officers, directors, employees,
representatives and agents, and each person, if any, who controls the
Company within the meaning of the Securities Act or the Exchange Act
(collectively referred to for purposes of this Section 9(b) and Section 10
as the Company), from and against any loss, claim, damage or liability,
joint or several, or any action in respect thereof, to which the Company
may become subject, whether commenced or threatened, under the Securities
Act, the Exchange Act, any other federal or state statutory law or
regulation, at common law or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based upon, (i) any untrue
statement or alleged untrue statement of a material fact contained in the
Preliminary Offering Memorandum or the Offering Memorandum or in any
amendment or supplement thereto or (ii) the omission or alleged omission to
state therein a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading, but in each case only to the
extent that the untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with any
Initial Purchasers' Information, and shall reimburse the Company promptly
upon demand for any legal or other expenses reasonably incurred by the
Company in connection with investigating or defending or preparing to
defend against or appearing as a third party witness in connection with any
such loss, claim, damage, liability or action as such expenses are
incurred.
22
(c) Promptly after receipt by an indemnified party under this Section 9
of notice of any claim or the commencement of any action, the indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party pursuant to Section 9(a) or 9(b), notify the
indemnifying party in writing of the claim or the commencement of that
action; provided, however, that the failure to notify the indemnifying
party shall not relieve it from any liability which it may have under this
Section 9 except to the extent that it has been materially prejudiced
(through the forfeiture of substantive rights or defenses) by such failure;
and, provided, further, that the failure to notify the indemnifying party
shall not relieve it from any liability which it may have to an indemnified
party otherwise than under this Section 9. If any such claim or action
shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any
other similarly notified indemnifying party, to assume the defense thereof
with counsel reasonably satisfactory to the indemnified party. After notice
from the indemnifying party to the indemnified party of its election to
assume the defense of such claim or action, the indemnifying party shall
not be liable to the indemnified party under this Section 9 for any legal
or other expenses subsequently incurred by the indemnified party in
connection with the defense thereof other than reasonable costs of
investigation; provided, however, that an indemnified party shall have the
right to employ its own counsel in any such action, but the fees, expenses
and other charges of such counsel for the indemnified party will be at the
expense of such indemnified party unless (1) the employment of counsel by
the indemnified party has been authorized in writing by the indemnifying
party, (2) the indemnified party has reasonably concluded (based upon
advice of counsel to the indemnified party) that there may be legal
defenses available to it or other indemnified parties that are different
from or in addition to those available to the indemnifying party, (3) a
conflict or potential conflict exists (based upon advice of counsel to the
indemnified party) between the indemnified party and the indemnifying party
(in which case the indemnifying party will not have the right to direct the
defense of such action on behalf of the indemnified party) or (4) the
indemnifying party has not in fact employed counsel reasonably satisfactory
to the indemnified party to assume the defense of such action within a
reasonable time after receiving notice of the commencement of the action,
in each of which cases the reasonable fees, disbursements and other charges
of counsel will be at the expense of the indemnifying party or parties. It
is understood that the indemnifying party or parties shall not, in
connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the reasonable fees, disbursements and other
charges of more than one separate firm of attorneys (in addition to no more
than one local counsel in any jurisdiction) at any one time for all such
indemnified party or parties. Each indemnified party, as a condition of the
indemnity agreements contained in Sections 9(a) and 9(b), shall use all
reasonable efforts to cooperate with the indemnifying party in the defense
of any such action or claim. No indemnifying party shall be liable for any
settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its
written consent or if there be a final judgment for the plaintiff in any
such action, the indemnifying party agrees to indemnify and hold harmless
any indemnified party from and against any loss or liability by reason of
such settlement or judgment. No indemnifying party shall, without the prior
written consent of the indemnified party (which consent shall not be
unreasonably withheld), effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or could have been
a party and indemnity could have been sought hereunder
23
by such indemnified party unless such settlement includes an unconditional
release of such indemnified party from all liability on claims that are the
subject matter of such proceedings.
The obligations of the Company and the Initial Purchasers in this
Section 9 and in Section 10 are in addition to any other liability that the
Company or the Initial Purchasers, as the case may be, may otherwise have,
including in respect of any breaches of representations, warranties and
agreements made herein by any such party.
10. Contribution. If the indemnification provided for in Section 9 is
unavailable or insufficient to hold harmless an indemnified party under Section
9(a) or 9(b), then each indemnifying party shall, in lieu of indemnifying such
indemnified party, contribute to the amount paid or payable by such indemnified
party as a result of such loss, claim, damage or liability, or action in respect
thereof, (i) in such proportion as shall be appropriate to reflect the relative
benefits received by the Company on the one hand and the Initial Purchasers on
the other from the offering of the Securities or (ii) if the allocation provided
by clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and the Initial
Purchasers on the other with respect to the statements or omissions that
resulted in such loss, claim, damage or liability, or action in respect thereof,
as well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the Initial Purchasers on the other
with respect to such offering shall be deemed to be in the same proportion as
the total net proceeds from the offering of the Securities purchased under this
Agreement (before deducting expenses) received by or on behalf of the Company,
on the one hand, and the total discounts and commissions received by the Initial
Purchasers with respect to the Securities purchased under this Agreement, on the
other, bear to the total gross proceeds from the sale of the Securities under
this Agreement. The relative fault shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to the
Company or information supplied by the Company on the one hand or to any Initial
Purchasers' Information 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 omissions. The Company and the Initial Purchasers agree
that it would not be just and equitable if contributions pursuant to this
Section 10 were to be determined by pro rata allocation or by any other method
of allocation that does not take into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as a
result of the loss, claim, damage or liability, or action in respect thereof,
referred to above in this Section 10 shall be deemed to include, for purposes of
this Section 10, any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending or preparing to
defend any such action or claim. Notwithstanding the provisions of this Section
10, the Initial Purchasers shall not be required to contribute any amount in
excess of the amount by which the total discounts and commissions received by
such Initial Purchaser with respect to the Securities purchased by it under this
Agreement exceeds the amount of any damages which such Initial Purchaser has
otherwise paid or become liable to pay by reason of any untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of
24
Section 11(f) of the Securities Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
11. Persons Entitled to Benefit of Agreement. This Agreement shall inure to
the benefit of and be binding upon the Initial Purchasers, the Company and their
respective successors. This Agreement and the terms and provisions hereof are
for the sole benefit of only those persons, except as provided in Sections 9 and
10 with respect to affiliates, officers, directors, employees, representatives,
agents and controlling persons of the Company and the Initial Purchasers and in
Section 4(e) with respect to holders and prospective purchasers of the
Securities. Nothing in this Agreement is intended or shall be construed to give
any person, other than the persons referred to in this Section 11, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision contained herein.
12. Expenses. The Company agrees with the Initial Purchasers to pay (a) the
costs incident to the authorization, issuance, sale, preparation and delivery of
the Securities and any taxes payable in that connection; (b) the costs incident
to the preparation, printing and distribution of the Preliminary Offering
Memorandum, the Offering Memorandum and any amendments or supplements thereto;
(c) the costs of reproducing and distributing each of the Transaction Documents;
(d) the costs incident to the preparation, printing and delivery of the
certificates evidencing the Securities, including stamp duties and transfer
taxes, if any, payable upon issuance of the Securities; (e) the fees and
expenses of the Company's counsel and independent accountants; (f) the
reasonable fees and expenses of qualifying the Securities under the securities
laws of the several jurisdictions as provided in Section 4(g) and of preparing,
printing and distributing Blue Sky Memoranda (including related fees and
expenses of counsel for the Initial Purchasers); (g) any fees charged by rating
agencies for rating the Securities; (h) the fees and expenses of the Trustee and
any paying agent (including related fees and expenses of any counsel to such
parties); (i) all expenses and application fees incurred in connection with the
application for the inclusion of the Securities on the PORTAL Market and the
approval of the Securities for book-entry transfer by DTC; and (j) all other
costs and expenses incident to the performance of the obligations of the Company
under this Agreement which are not otherwise specifically provided for in this
Section 11; provided, however, that except as provided in this Section 12 and
Section 8, the Initial Purchasers shall pay their own costs and expenses,
including the fees, disbursements and expenses of its counsel, its road-show
costs and any transfer taxes on the Securities that it may sell.
13. Survival. The respective indemnities, rights of contribution,
representations, warranties and agreements of the Company and the Initial
Purchasers contained in this Agreement or made by or on behalf of the Company or
the Initial Purchasers pursuant to this Agreement or any certificate delivered
pursuant hereto shall survive the delivery of and payment for the Securities and
shall remain in full force and effect, regardless of any termination or
cancellation of this Agreement or any investigation made by or on behalf of any
of them or any of their respective affiliates, officers, directors, employees,
representatives, agents or controlling persons.
14. Notices, etc. All statements, requests, notices and agreements
hereunder shall be in writing, and:
25
(a) if to the Initial Purchasers, shall be delivered or sent by mail or
telecopy transmission to X. X. Xxxxxx Securities, Inc., 000 Xxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Xx. Xxxxx Xxxxxx (telecopier no.:
(000) 000-0000); or
(b) if to the Company, shall be delivered or sent by mail or telecopy
transmission to the address of the Company set forth in the Offering
Memorandum, Attention: Xx. Xxxxx Xxxx, Vice President and Chief Financial
Officer (telecopier no.: (000) 000-0000), with a copy to Xxxx Xxxxx
Sellers., Esq., McGuireWoods LLP (telecopier no.: (000) 000-0000);
provided that any notice to an Initial Purchaser pursuant to Section 9(c) shall
also be delivered or sent by mail to such Initial Purchaser at its address set
forth on the signature page hereof. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof. The Company shall
be entitled to act and rely upon any request, consent, notice or agreement given
or made on behalf of the Initial Purchasers by JPMSI.
15. Definition of Terms. For purposes of this Agreement, (a) the term
"business day" means any day on which the New York Stock Exchange, Inc. and
commercial banks in New York, New York and Richmond, Virginia are open for
trading or business, (b) the term "subsidiary" has the meaning set forth in Rule
405 under the Securities Act and (c) except where otherwise expressly provided,
the term "affiliate" has the meaning set forth in Rule 405 under the Securities
Act.
16. Initial Purchasers' Information. The parties hereto acknowledge and
agree that, for all purposes of this Agreement, the Initial Purchasers'
Information consists solely of the following information in the Preliminary
Offering Memorandum and the Offering Memorandum: the statements concerning the
Initial Purchasers contained in the third and twelfth paragraphs, and the fourth
and fifth sentences of the eleventh paragraph under the heading "Plan of
Distribution," the sixth and seventh sentences of the eighteenth paragraph under
the heading "Summary--The Offering," the second and third sentences of the
second paragraph under the heading "Risk Factors--Lack of Public Market;
Restrictions on Transferability," and, with respect to each Initial Purchaser,
such Initial Purchaser's name at it appears on the cover.
17. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
18. Counterparts. This Agreement may be executed in one or more
counterparts (which may include counterparts delivered by telecopier) and, if
executed in more than one counterpart, the executed agreement, counterparts
shall each be deemed to be an original, but all such counterparts shall together
constitute one and the same instrument.
19. Amendments. No amendment or waiver of any provision of this
Agreement, nor any consent or approval to any departure therefrom, shall in any
event be effective unless the same shall be in writing and signed by the parties
hereto (it being understood that the successful delivery of and payment for the
Securities shall constitute an effective waiver
26
of any outstanding pre-closing condition contained in Section 5 hereof, known to
the Initial Purchasers on the Closing Date).
20. Headings. The headings herein are inserted for convenience of reference
only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
If the foregoing is in accordance with your understanding of our agreement,
kindly sign and return to us a counterpart hereof, whereupon this instrument
will become a binding agreement between the Company and the several Initial
Purchasers in accordance with its terms.
Very truly yours,
SMITHFIELD FOODS, INC.
By /s/ C. Xxxxx Xxxx
----------------------------
Name: C. XXXXX XXXX
Title: Vice President and Chief Financial
Officer
Accepted:
X.X. XXXXXX SECURITIES INC.
By /s/ Xxxxx Xxxxxx
------------------------------------------
Authorized Signatory
Address for notices pursuant to Section 9(c):
0 Xxxxx Xxxxx, 00xx xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Legal Department
XXXXXXX, XXXXX & CO.
By /s/ Xxxxxxx, Sachs & Co.
------------------------------------------
(Xxxxxxx, Xxxxx & Co.)
Address for notices pursuant to Section 9(c):
00 Xxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxx Xxxxxx, Registration Department
SCHEDULE I
Principal
Amount
Initial Purchasers of Securities
------------------ -------------
JPMorgan $252,000,000
Xxxxxxx, Xxxxx & Co. 48,000,000
------------
Total $300,000,000
SCHEDULE II
SUBSIDIARIES OF THE COMPANY
Animex S.A.
Animpol S.A.
B&G Farms LLC
Xxxxx'x Farms LLC
Xxxxx'x of Carolina LLC
Xxxxxxx'x Capital, Inc.
Xxxxxxx'x Foods LLC
Xxxxxxx'x Foods of Brazil, LLC
Xxxxxxx'x Foods of Mexico, Inc.
Xxxxxxx'x Foods of Virginia LLC
Xxxxxxx'x Processing, Inc.
Xxxxxxx'x Realty Inc.
Xxxxxxx'x Turkeys, Inc.
Central Plains Farms LLC
Charcuterie Xxx Inc.
Charcuteries Imperator S.A.
Circle Four LLC d/b/a Circle Four Farms
Coddle Roasted Meats, Inc.
Consolidated Food Brands Inc.
Dakota Acquisition Company
Xx Xxxxx, Inc.
Esskay Investments, Inc.
Xxxxxxxx of Smithfield, Ltd.
Xxxxxxxx Transportation Co., Inc.
Xxxxxxx'x Old Fashioned Country Ham, Inc.
Iowa Quality Meats, Ltd.
Jasan Sp. z o.o.
Xxxx d'Erguet S.A.
J. M. Xxxxxxxxx Inc.
Xxxx Xxxxxxx & Co.
Xxxx Xxxxxxx of Japan, Inc.
JonMor Investments, Inc.
LMG Investments, Inc.
LMJ Distribution Center, Inc.
Xxxxx Meat Group, Inc.
MOPAC Foreign Sales Corporation
MOPAC of Virginia, Inc.
Xxxxx Packing Company
Xxxxxx-Xxxxx LLC
Xxxxxx Farms LLC
Xxxxxx Funding, Inc.
0
Xxxxx Xxxx Xxxxx Xxxx.
Xxxxx Xxxx Investments, Inc.
NPD Investments, Inc.
Xxxxxxx Xxxxxx Incorporated
PatCud Investments, Inc.
PC Express, Inc.
Pinnacle Foods, Inc.
Premium Pork, Inc.
Prochowickie Zaklady Drobiarskie Sp. z o.o.
Quarter M Farms LLC
Quik-to-Fix Foods, Inc.
Xxxxxxxxx Corporation
Skippack Creek Corporation
Xxxxxxxxx Foods Inc.
SF Investments, Inc.
SFDS Global Holdings B.V.
SFFC, Inc.
Smithfield Canada, Ltd.
Smithfield Foods de Mexico de X.X. de C.V.
Smithfield Inn Corporation
Smithfield Insurance Co. Ltd.
Smithfield International, Inc.
Smithfield International Investments, Inc.
Smithfield Packing Real Estate, LLC
Smithfield Packing Transportation Co., Inc.
Smithfield Purchase Corporation
Smithfield Transportation Co., Inc.
Societe Bretonne de Salaisons
Societe Financiere de Gestion et de Participation S.A.
Sunnyland, Inc.
Suwalskie Zaklady Drobiarskie Sp. z o.o.
The Smithfield Companies, Inc.
The Smithfield Packing Company, Incorporated
Zaklady Miesne "Agryf" Sp. z o.o.
Zaklady Miesne "Mazury" w Elku Sp. z o.o.
Zaklady Miesne "Przylep" S.A. w Przylepoe
ANNEX A
SMITHFIELD FOODS, INC.
$300,000,000
8% Senior Notes due 2009
EXCHANGE AND REGISTRATION RIGHTS AGREEMENT
------------------------------------------
October 23, 2001
X.X. Xxxxxx Securities, Inc.
Xxxxxxx, Sachs & Co.
c/o X.X. Xxxxxx Securities, Inc.
000 Xxxx Xxxxxx, 0xx xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Smithfield Foods, Inc., a Virginia corporation (the "Company"),
proposes to issue and sell to X.X. Xxxxxx Securities Inc. (("JPMSI") and
Xxxxxxx, Sachs & Co. ("GS", and together with JPMSI, the "Initial Purchasers"),
upon the terms and subject to the conditions set forth in a purchase agreement
dated October 17, 2001 (the "Purchase Agreement"), $300,000,000 aggregate
principal amount of its 8% Senior Notes due 2009 (the "Securities").
Capitalized terms used but not defined herein shall have the meanings given to
such terms in the Purchase Agreement.
As an inducement to the Initial Purchasers to enter into the Purchase
Agreement and in satisfaction of a condition to the obligations of the Initial
Purchasers thereunder, the Company agrees with the Initial Purchasers, for the
benefit of the holders (including the Initial Purchasers) of the Securities, the
Exchange Securities (as defined herein) and the Private Exchange Securities (as
defined herein) (collectively, the "Holders"), as follows:
1. Registered Exchange Offer. The Company shall (i) prepare and, not
later than 90 days following the date of original issuance of the Securities
(the "Issue Date"), file with the Commission a registration statement (the
"Exchange Offer Registration Statement") on an appropriate form under the
Securities Act with respect to a proposed offer to the Holders of the Securities
(the "Registered Exchange Offer") to issue and deliver to such Holders, in
exchange for the Securities, a like aggregate principal amount of debt
securities of the Company (the "Exchange Securities") that are identical in all
material respects to the Securities, except for the transfer restrictions
relating to the Securities, (ii) use its reasonable best efforts to cause the
2
Exchange Offer Registration Statement to become effective under the Securities
Act no later than 150 days after the Issue Date and the Registered Exchange
Offer to be consummated no later than 180 days after the Issue Date and (iii)
keep the Exchange Offer Registration Statement effective for not less than 30
days (or longer, if required by applicable law) after the date on which notice
of the Registered Exchange Offer is mailed to the Holders (such period being
called the "Exchange Offer Registration Period"). The Exchange Securities will
be issued under the Indenture or an indenture (the "Exchange Securities
Indenture") between the Company and the Trustee or such other bank or trust
company that is reasonably satisfactory to the Initial Purchasers, as trustee
(the "Exchange Securities Trustee"), such indenture to be identical in all
material respects to the Indenture, except for the transfer restrictions
relating to the Securities (as described above).
Upon the effectiveness of the Exchange Offer Registration Statement,
the Company shall promptly commence the Registered Exchange Offer, it being the
objective of such Registered Exchange Offer to enable each Holder electing to
exchange Securities for Exchange Securities (assuming that such Holder (a) is
not an affiliate of the Company or an Exchanging Dealer (as defined herein) not
complying with the requirements of the next sentence, (b) is not an Initial
Purchaser holding Securities that have, or that are reasonably likely to have,
the status of an unsold allotment in an initial distribution, (c) acquires the
Exchange Securities in the ordinary course of such Holder's business and (d) has
no arrangements or understandings with any person to participate in the
distribution of the Exchange Securities) and to trade such Exchange Securities
from and after their receipt without any limitations or restrictions under the
Securities Act and without material restrictions under the securities laws of
the several states of the United States. The Company, the Initial Purchasers
and each Exchanging Dealer acknowledge that, pursuant to current interpretations
by the Commission's staff of Section 5 of the Securities Act, (i) each Holder
that is a broker-dealer electing to exchange Securities, acquired for its own
account as a result of market-making activities or other trading activities, for
Exchange Securities (an "Exchanging Dealer"), is required to deliver a
prospectus containing substantially the information set forth in Annex A hereto,
in Annex B hereto in the "Exchange Offer Procedures" section and the "Purpose of
the Exchange Offer" section and in Annex C hereto in the "Plan of Distribution"
section of such prospectus in connection with a sale of any such Exchange
Securities received by such Exchanging Dealer pursuant to the Registered
Exchange Offer and (ii) if any Initial Purchaser elects to sell Private Exchange
Securities acquired in exchange for Securities constituting any portion of an
unsold allotment, it is required to deliver a prospectus containing the
information required by Items 507 or 508 of Regulation S-K under the Securities
Act and the Exchange Act ("Regulation S-K").
If, prior to the consummation of the Registered Exchange Offer, any
Holder holds any Securities acquired by it that have, or that are reasonably
likely to be determined to have, the status of an unsold allotment in an initial
distribution, or any Holder is not entitled to participate in the Registered
Exchange Offer, the Company shall, upon the request of any such Holder,
simultaneously with the delivery of the Exchange Securities in the Registered
Exchange Offer, issue and deliver to any such Holder, in exchange for the
Securities held by such Holder (the "Private Exchange"), a like aggregate
principal amount of debt securities of the Company (the "Private Exchange
Securities") that are identical in all material respects to the Exchange
3
Securities, except for the transfer restrictions relating to such Private
Exchange Securities. The Private Exchange Securities will be issued under the
same indenture as the Exchange Securities, and the Company shall use its
reasonable best efforts to cause the Private Exchange Securities to bear the
same CUSIP number as the Exchange Securities.
In connection with the Registered Exchange Offer, the Company shall:
(a) mail to each Holder a copy of the prospectus forming part of the
Exchange Offer Registration Statement, together with an appropriate letter
of transmittal and related documents;
(b) keep the Registered Exchange Offer open for not less than 30 days
(or longer, if required by applicable law) after the date on which notice
of the Registered Exchange Offer is mailed to the Holders;
(c) utilize the services of a depositary for the Registered Exchange
Offer with an address in the Borough of Manhattan, The City of New York;
(d) permit Holders to withdraw tendered Securities at any time prior
to the close of business, New York City time, on the last business day on
which the Registered Exchange Offer shall remain open; and
(e) otherwise comply in all respects with all laws that are
applicable to the Registered Exchange Offer.
As soon as practicable after the close of the Registered Exchange
Offer and any Private Exchange, as the case may be, the Company shall:
(a) accept for exchange all Securities tendered and not validly
withdrawn pursuant to the Registered Exchange Offer and the Private
Exchange;
(b) deliver to the Trustee for cancellation all Securities so
accepted for exchange; and
(c) cause the Trustee or the Exchange Securities Trustee, as the case
may be, promptly to authenticate and deliver to each Holder, Exchange
Securities or Private Exchange Securities, as the case may be, equal in
principal amount to the Securities of such Holder so accepted for exchange.
The Company shall use its reasonable best efforts to keep the Exchange
Offer Registration Statement effective and to amend and supplement the
prospectus contained therein in order to permit such prospectus to be used by
all persons subject to the prospectus delivery requirements of the Securities
Act for such period of time as such persons must comply with such requirements
in order to resell the Exchange Securities; provided that (i) in the case where
such prospectus
4
and any amendment or supplement thereto must be delivered by an Exchanging
Dealer, such period shall be the lesser of 180 days and the date on which all
Exchanging Dealers have sold all Exchange Securities held by them and (ii) the
Company shall make such prospectus and any amendment or supplement thereto
available to any broker-dealer for use in connection with any resale of any
Exchange Securities for a period of not less than 90 days after the consummation
of the Registered Exchange Offer.
The Indenture or the Exchange Securities Indenture, as the case may
be, shall provide that the Securities, the Exchange Securities and the Private
Exchange Securities shall vote and consent together on all matters as one class
and that none of the Securities, the Exchange Securities or the Private Exchange
Securities will have the right to vote or consent as a separate class on any
matter.
Interest on each Exchange Security and Private Exchange Security
issued pursuant to the Registered Exchange Offer and in the Private Exchange
will accrue from the last interest payment date on which interest was paid on
the Securities surrendered in exchange therefor or, if no interest has been paid
on the Securities, from the Issue Date.
Each Holder participating in the Registered Exchange Offer shall be
required to represent to the Company that at the time of the consummation of the
Registered Exchange Offer (i) any Exchange Securities received by such Holder
will be acquired in the ordinary course of business, (ii) such Holder will have
no arrangements or understanding with any person to participate in the
distribution of the Securities or the Exchange Securities within the meaning of
the Securities Act, (iii) such Holder is not an affiliate of the Company or, if
it is such an affiliate, such Holder will comply with the registration and
prospectus delivery requirements of the Securities Act to the extent applicable,
(iv) if the Holder is not a broker-dealer, it is not engaged in, and does not
intend to engage in, the distribution of the Exchange Securities and (v) if such
person is an Exchanging Dealer, such person shall comply with the prospectus
delivery requirements of the Securities Act.
Notwithstanding any other provisions hereof, the Company will ensure
that (i) any Exchange Offer Registration Statement and any amendment thereto and
any prospectus forming part thereof and any supplement thereto complies in all
material respects with the Securities Act and the rules and regulations of the
Commission thereunder, (ii) any Exchange Offer Registration Statement and any
amendment thereto does not, when it becomes effective, contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading and
(iii) any prospectus forming part of any Exchange Offer Registration Statement,
and any supplement to such prospectus, does not, as of the consummation of the
Registered Exchange Offer, include an 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.
2. Shelf Registration. If (i) because of any change in law or
applicable interpretations thereof by the Commission's staff the Company is not
permitted to effect the Registered Exchange Offer as contemplated by Section 1
hereof, or (ii) for any other reason the Registered Exchange Offer is not
consummated within 180 days after the Issue Date, or (iii) any Initial Purchaser
so requests with respect to Securities or Private Exchange Securities not
eligible to be exchanged for Exchange Securities in the Registered Exchange
Offer and held by it
5
following the consummation of the Registered Exchange Offer, or (iv) any
applicable law or interpretations do not permit any Holder to participate in the
Registered Exchange Offer, (v) any Holder that participates in the Registered
Exchange Offer does not receive freely transferable Exchange Securities in
exchange for tendered Securities, or (vi) any Securities validly tendered
pursuant to the Registered Exchange Offer are not exchanged for Exchange
Securities within 10 days of being accepted in the Registered Exchange Offer,
then the following provisions shall apply:
(a) The Company shall use its reasonable best efforts to file as
promptly as practicable (but in no event more than 75 days after so required or
requested pursuant to this Section 2) with the Commission (the "Shelf Filing
Date"), and thereafter shall use its reasonable best efforts to cause to be
declared effective, a shelf registration statement on an appropriate form under
the Securities Act relating to the offer and sale of the Transfer Restricted
Securities (as defined below) by the Holders thereof from time to time in
accordance with the methods of distribution set forth in such registration
statement (hereafter, a "Shelf Registration Statement" and, together with any
Exchange Offer Registration Statement, a "Registration Statement"); provided,
however, that no Holder of Transfer Restricted Securities (other than the
Initial Purchasers) shall be entitled to have Transfer Restricted Securities
held by it covered by such Shelf Registration Statement unless such Holder
agrees in writing to be bound by all the provisions of this Agreement applicable
to such Holder.
(b) The Company shall use its reasonable best efforts to keep the
Shelf Registration Statement continuously effective in order to permit the
prospectus forming part thereof to be used by Holders of Transfer Restricted
Securities (as defined below) for a period ending on the earlier of (i) two
years from the Issue Date or such shorter period that will terminate when all
the Transfer Restricted Securities covered by the Shelf Registration Statement
have been sold pursuant thereto and (ii) the date on which the Securities become
eligible for resale without volume restrictions pursuant to Rule 144 under the
Securities Act (in any such case, such period being called the "Shelf
Registration Period"). The Company shall be deemed not to have used its
reasonable best efforts to keep the Shelf Registration Statement effective
during the requisite period if it voluntarily takes any action that would result
in Holders of Transfer Restricted Securities covered thereby not being able to
offer and sell such Transfer Restricted Securities during that period, unless
such action is required by applicable law; provided however, that the foregoing
shall not apply to actions taken by the Company in good faith and for valid
business reasons (not including avoidance of their obligations hereunder),
including, without limitation, the acquisition or divestiture of assets, so long
as the Company within 30 days thereafter complies with the requirements of
Section 4(j) hereof. Any such period during which the Company fails to keep the
Shelf Registration Statement effective and usable for offers and sales of
Transfer Restricted Securities is referred to as a "Suspension Period." A
Suspension Period shall commence on and include the date that the Company gives
notice that the Shelf Registration Statement is no longer effective or the
prospectus included therein is no longer usable for offers and sales of Transfer
Restricted Securities and shall end on the date when each Holder of Transfer
Restricted Securities covered by such registration statement either receives the
copies of the supplemented or amended prospectus contemplated by Section 4(j)
hereof or is advised in writing by the Company that use of the prospectus may be
resumed. If
6
one or more Suspension Periods occur, the two-year time period referenced above
shall be extended by the aggregate of the number of days included in each such
Suspension Period.
(c) Notwithstanding any other provisions hereof, the Company will
ensure that (i) any Shelf Registration Statement and any amendment thereto and
any prospectus forming part thereof and any supplement thereto complies in all
material respects with the Securities Act and the rules and regulations of the
Commission thereunder, (ii) any Shelf Registration Statement and any amendment
thereto (in either case, other than with respect to information included therein
in reliance upon or in conformity with written information furnished to the
Company by or on behalf of any Holder specifically for use therein (the
"Holders' Information")) does not contain an untrue statement a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein not misleading and (iii) any prospectus forming part of
any Shelf Registration Statement, and any supplement to such prospectus (in
either case, other than with respect to Holders' Information), does not include
an 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.
(d) In the absence of the events described in clauses (i) through
(vi) of the first paragraph of this Section 2, the Company shall not be
permitted to discharge its obligations hereunder by means of the filing of a
Shelf Registration Statement.
3. Additional Interest. (a) The parties hereto agree that the
Holders of Transfer Restricted Securities will suffer damages if the Company
fails to fulfill its obligations under Section 1 or Section 2, as applicable,
and that it would not be feasible to ascertain the extent of such damages.
Accordingly, if (i) the Exchange Offer Registration Statement is not filed with
the Commission on or prior to 90 days after the Issue Date or the Shelf
Registration Statement is not filed with the Commission on or before the Shelf
Filing Date, (ii) the Exchange Offer Registration Statement is not declared
effective within 150 days after the Issue Date or the Shelf Registration
Statement is not declared effective within 150 days of the Shelf Filing Date,
(iii) the Registered Exchange Offer is not consummated on or prior to 180 days
after the Issue Date, or (iv) the Shelf Registration Statement is filed and
declared effective within 150 days after the Shelf Filing Date but shall
thereafter cease to be effective (at any time that the Company is obligated to
maintain the effectiveness thereof) without being succeeded within 75 days by an
additional Registration Statement filed and declared effective (each such event
referred to in clauses (i) through (iv), a "Registration Default"), the Company
will be obligated to pay additional interest to each Holder of Transfer
Restricted Securities, during the period of one or more such Registration
Defaults, in an amount equal to $0.192 per week per $1,000 principal amount of
Transfer Restricted Securities held by such Holder until (i) the applicable
Registration Statement is filed, (ii) the Exchange Offer Registration Statement
is declared effective and the Registered Exchange Offer is consummated, (iii)
the Shelf Registration Statement is declared effective or (iv) the Shelf
Registration Statement again becomes effective, as the case may be. Following
the cure of all Registration Defaults, the accrual of additional interest will
cease. As used herein, the term "Transfer Restricted Securities" means each
Security or Private Exchange Security until the earliest to occur of (i) the
date on which such Security has been exchanged for a freely transferable
Exchange Security in the Registered Exchange Offer, (ii) each Security or
7
Private Exchange Security until the date on which it has been effectively
registered under the Securities Act and disposed of in accordance with the Shelf
Registration Statement or (iii) each Security or Private Exchange Security until
the date on which it is distributed to the public pursuant to Rule 144 under the
Securities Act or is saleable pursuant to Rule 144(k) under the Securities Act.
Notwithstanding anything to the contrary in this Section 3(a), the Company shall
not be required to pay additional interest to a Holder of Transfer Restricted
Securities if such Holder failed to comply with its obligations to make the
representations set forth in the second to last paragraph of Section 1 or failed
to provide the information required to be provided by it, if any, pursuant to
Section 4(n).
(b) The Company shall notify the Trustee and the Paying Agent under
the Indenture immediately upon the happening of each and every Registration
Default. The Company shall pay the additional interest due on the Transfer
Restricted Securities by depositing with the Paying Agent (which may not be the
Company for these purposes), in trust, for the benefit of the Holders thereof,
prior to 10:00 a.m., New York City time, on the next interest payment date
specified by the Indenture and the Securities, sums sufficient to pay the
additional interest then due. The additional interest due shall be payable on
each interest payment date specified by the Indenture and the Securities to the
record holder of the Transfer Restricted Securities entitled to receive the
interest payment to be made on such date. Each obligation to pay additional
interest shall be deemed to accrue from and including the date of the applicable
Registration Default.
(c) The parties hereto agree that the additional interest provided
for in this Section 3 constitute a reasonable estimate of and are intended to
constitute the sole damages that will be suffered by Holders of Transfer
Restricted Securities by reason of the failure of (i) the Shelf Registration
Statement or the Exchange Offer Registration Statement to be filed, (ii) the
Shelf Registration Statement to remain effective or (iii) the Exchange Offer
Registration Statement to be declared effective and the Registered Exchange
Offer to be consummated, in each case, to the extent required by this Agreement.
4. Registration Procedures. In connection with any Registration
Statement, the following provisions shall apply:
(a) The Company shall (i) furnish to each Initial Purchaser, prior to
the filing thereof with the Commission, a copy of the Registration Statement and
each amendment thereof and each supplement, if any, to the prospectus included
therein and shall use its reasonable best efforts to reflect in each such
document, when so filed with the Commission, such comments as any Initial
Purchaser may reasonably propose; (ii) include the information set forth in
Annex A hereto on the cover, in Annex B hereto in the "Exchange Offer
Procedures" section and the "Purpose of the Exchange Offer" section and in Annex
C hereto in the "Plan of Distribution" section of the prospectus forming a part
of the Exchange Offer Registration Statement, and include the information set
forth in Annex D hereto in the Letter of Transmittal delivered pursuant to the
Registered Exchange Offer; and (iii) if requested by any Initial Purchaser,
include the information required by Items 507 or 508 of Regulation S-K, as
applicable, in the prospectus forming a part of the Exchange Offer Registration
Statement.
8
(b) The Company shall advise each Initial Purchaser, each Exchanging
Dealer and the Holders (if applicable) and, if requested by any such person,
confirm such advice in writing (which advice pursuant to clauses (ii)-(v) hereof
shall be accompanied by an instruction to suspend the use of the prospectus
until the requisite changes have been made):
(i) when any Registration Statement and any amendment thereto has
been filed with the Commission and when such Registration Statement or any
post-effective amendment thereto has become effective;
(ii) of any request by the Commission for amendments or supplements to
any Registration Statement or the prospectus included therein or for
additional information;
(iii) of the issuance by the Commission of any stop order suspending
the effectiveness of any Registration Statement or the initiation of any
proceedings for that purpose;
(iv) of the receipt by the Company of any notification with respect to
the suspension of the qualification of the Securities, the Exchange
Securities or the Private Exchange Securities for sale in any jurisdiction
or the initiation or threatening of any proceeding for such purpose; and
(v) of the happening of any event that requires the making of any
changes in any Registration Statement or the prospectus included therein in
order that the statements therein are not misleading and do not omit to
state a material fact required to be stated therein or necessary to make
the statements therein not misleading.
(c) The Company will make every reasonable effort to obtain the
withdrawal at the earliest possible time of any order suspending the
effectiveness of any Registration Statement.
(d) The Company will furnish to each Holder of Transfer Restricted
Securities included within the coverage of any Shelf Registration Statement,
without charge, at least one conformed copy of such Shelf Registration Statement
and any post-effective amendment thereto, including financial statements and
schedules and, if any such Holder so requests in writing, all exhibits thereto
(including those, if any, incorporated by reference).
(e) The Company will, during the Shelf Registration Period, promptly
deliver to each Holder of Transfer Restricted Securities included within the
coverage of any Shelf Registration Statement, without charge, as many copies of
the prospectus (including each preliminary prospectus) included in such Shelf
Registration Statement and any amendment or supplement thereto as such Holder
may reasonably request; and the Company consents to the use of such prospectus
or any amendment or supplement thereto by each of the selling Holders of
Transfer Restricted Securities in connection with the offer and sale of the
Transfer Restricted Securities covered by such prospectus or any amendment or
supplement thereto.
9
(f) The Company will furnish to each Initial Purchaser and each
Exchanging Dealer, and to any other Holder who so requests, without charge, at
least one conformed copy of the Exchange Offer Registration Statement and any
post-effective amendment thereto, including financial statements and schedules
and, if any Initial Purchasers or Exchanging Dealer or any such Holder so
requests in writing, all exhibits thereto (including those, if any, incorporated
by reference).
(g) The Company will, during the Exchange Offer Registration Period
or the Shelf Registration Period, as applicable, promptly deliver to each
Initial Purchaser, each Exchanging Dealer and any such other persons that are
required to deliver a prospectus following the Registered Exchange Offer,
without charge, as many copies of the final prospectus included in the Exchange
Offer Registration Statement or the Shelf Registration Statement and any
amendment or supplement thereto as such Initial Purchasers, Exchanging Dealer or
other persons may reasonably request; and the Company consents to the use of
such prospectus or any amendment or supplement thereto by any such Initial
Purchasers, Exchanging Dealer or other persons, as applicable, as aforesaid.
(h) Prior to the effective date of any Registration Statement, the
Company will use its reasonable best efforts to register or qualify, or
cooperate with the Holders of Securities, Exchange Securities or Private
Exchange Securities included therein and their respective counsel in connection
with the registration or qualification of, such Securities, Exchange Securities
or Private Exchange Securities for offer and sale under the securities or blue
sky laws of such jurisdictions as any such Holder reasonably requests in writing
and do any and all other acts or things necessary or advisable to enable the
offer and sale in such jurisdictions of the Securities, Exchange Securities or
Private Exchange Securities covered by such Registration Statement; provided
that the Company will not be required to qualify generally to do business in any
jurisdiction where they are not then so qualified or to take any action which
would subject it to general service of process or to taxation in any such
jurisdiction where it is not then so subject.
(i) The Company will cooperate with the Holders of Securities,
Exchange Securities or Private Exchange Securities to facilitate the timely
preparation and delivery of certificates representing Securities, Exchange
Securities or Private Exchange Securities to be sold pursuant to any
Registration Statement free of any restrictive legends and in such denominations
and registered in such names as the Holders thereof may request in writing prior
to sales of Securities, Exchange Securities or Private Exchange Securities
pursuant to such Registration Statement.
(j) If any event contemplated by Section 4(b)(ii) through (v) occurs
during the period for which the Company is required to maintain an effective
Registration Statement, the Company will promptly prepare and file with the
Commission a post-effective amendment to the Registration Statement or a
supplement to the related prospectus or file any other required document so
that, as thereafter delivered to purchasers of the Securities, Exchange
Securities or Private Exchange Securities from a Holder, the prospectus will not
include an 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.
10
(k) Not later than the effective date of the applicable Registration
Statement, the Company will provide a CUSIP number for the Securities, the
Exchange Securities and the Private Exchange Securities, as the case may be, and
provide the applicable trustee with printed certificates for the Securities, the
Exchange Securities or the Private Exchange Securities, as the case may be, in a
form eligible for deposit with The Depository Trust Company.
(l) The Company will comply with all applicable rules and regulations
of the Commission and will make generally available to its security holders as
soon as practicable after the effective date of the applicable Registration
Statement an earnings statement satisfying the provisions of Section 11(a) of
the Securities Act; provided that in no event shall such earnings statement be
delivered later than 45 days after the end of a 12-month period (or 90 days, if
such period is a fiscal year) beginning with the first month of the Company's
first fiscal quarter commencing after the effective date of the applicable
Registration Statement, which statement shall cover such 12-month period.
(m) The Company will cause the Indenture or the Exchange Securities
Indenture, as the case may be, to be qualified under the Trust Indenture Act as
required by applicable law in a timely manner.
(n) The Company may require each Holder of Transfer Restricted
Securities to be registered pursuant to any Shelf Registration Statement to
furnish to the Company such information concerning the Holder and the
distribution of such Transfer Restricted Securities as the Company may from time
to time reasonably require for inclusion in such Shelf Registration Statement,
and the Company may exclude from such registration the Transfer Restricted
Securities of any Holder that fails to furnish such information within a
reasonable time after receiving such request.
(o) In the case of a Shelf Registration Statement, each Holder of
Transfer Restricted Securities to be registered pursuant thereto agrees by
acquisition of such Transfer Restricted Securities that, upon receipt of any
notice from the Company pursuant to Section 4(b)(ii) through (v), such Holder
will discontinue disposition of such Transfer Restricted Securities until such
Holder's receipt of copies of the supplemental or amended prospectus
contemplated by Section 4(j) or until advised in writing (the "Advice") by the
Company that the use of the applicable prospectus may be resumed. If the Company
shall give any notice under Section 4(b)(ii) through (v) during the period that
the Company is required to maintain an effective Registration Statement (the
"Effectiveness Period"), such Effectiveness Period shall be extended by the
number of days during such period from and including the date of the giving of
such notice to and including the date when each seller of Transfer Restricted
Securities covered by such Registration Statement shall have received (x) the
copies of the supplemental or amended prospectus contemplated by Section 4(j)
(if an amended or supplemental prospectus is required) or (y) the Advice (if no
amended or supplemental prospectus is required).
(p) In the case of a Shelf Registration Statement, the Company shall
enter into such customary agreements (including, if requested, an underwriting
agreement in customary form) and take all such other action, if any, as Holders
of a majority in aggregate principal amount of the Securities, Exchange
Securities and Private Exchange Securities being sold or the
11
managing underwriters (if any) shall reasonably request in order to facilitate
any disposition of such Securities, Exchange Securities or Private Exchange
Securities pursuant to such Shelf Registration Statement.
(q) In the case of a Shelf Registration Statement, the Company shall
(i) make reasonably available for inspection by a representative of, and Special
Counsel (as defined below) acting for, Holders of a majority in aggregate
principal amount of the Securities, Exchange Securities and Private Exchange
Securities being sold and any underwriter participating in any disposition of
Securities, Exchange Securities or Private Exchange Securities pursuant to such
Shelf Registration Statement, all relevant financial and other records,
pertinent corporate documents and properties of the Company and its subsidiaries
and (ii) use its reasonable best efforts to have its officers, directors,
employees, accountants and counsel supply all relevant information reasonably
requested by such representative, Special Counsel or any such underwriter (an
"Inspector") in connection with such Shelf Registration Statement; provided,
however, that such persons shall first agree in writing with the Company that
any information that is in good faith designated by the Company in writing as
confidential at the time of delivery of such information shall be kept
confidential by such persons, unless (i) disclosure of such information is
required by court or administrative order or is necessary to respond to
inquiries of regulatory authorities, (ii) disclosure of such information is
required by law (including any disclosure requirements pursuant to federal
securities laws in connection with the filing of such Shelf Registration
Statement or the use of any Prospectus), (iii) such information becomes
generally available to the public other than as a result of a disclosure or
failure to safeguard such information by such person or (iv) such information
becomes available to such person from a source other than the Company and its
subsidiaries and such source is not bound by a confidentiality agreement; and
provided further each such person will also be required to further agree in
writing that (i) it will, upon learning that disclosure of such information is
sought in a court of competent jurisdiction, if legally permitted, give notice
to the Company and allow the Company at its expense to undertake appropriate
action to prevent disclosure of such information deemed confidential and (ii) it
will not use such information in violation of any securities laws .
(r) In the case of a Shelf Registration Statement, the Company shall,
if requested by Holders of a majority in aggregate principal amount of the
Securities, Exchange Securities and Private Exchange Securities being sold,
their Special Counsel or the managing underwriters (if any) in connection with
such Shelf Registration Statement, use their reasonable best efforts to cause
(i) their counsel to deliver an opinion relating to the Shelf Registration
Statement and the Securities, Exchange Securities or Private Exchange
Securities, as applicable, in customary form, (ii) their officers to execute and
deliver all customary documents and certificates requested by such Holders of a
majority in aggregate principal amount of the Securities, Exchange Securities
and Private Exchange Securities being sold, their Special Counsel or the
managing underwriters (if any) and (iii) their independent public accountants to
provide a comfort letter or letters in customary form, subject to receipt of
appropriate documentation as contemplated, and only if permitted, by Statement
of Auditing Standards No. 72.
12
5. Registration Expenses. The Company will bear all expenses incurred
in connection with the performance of its obligations under Sections 1, 2, 3 and
4 and the Company will reimburse the Initial Purchasers and the Holders for the
reasonable fees and disbursements of one firm of attorneys (in addition to any
local counsel) chosen by the Holders of a majority in aggregate principal amount
of the Securities, the Exchange Securities and the Private Exchange Securities
to be sold pursuant to each Registration Statement (the "Special Counsel")
acting for the Initial Purchasers or Holders in connection therewith.
6. Indemnification. (a) In the event of a Shelf Registration
Statement or in connection with any prospectus delivery pursuant to an Exchange
Offer Registration Statement by an Initial Purchasers or Exchanging Dealer, as
applicable, the Company shall indemnify and hold harmless each Holder
(including, without limitation, any such Initial Purchasers or Exchanging
Dealer), its affiliates, their respective officers, directors, employees,
representatives and agents, and each person, if any, who controls such Holder
within the meaning of the Securities Act or the Exchange Act (collectively
referred to for purposes of this Section 6 and Section 7 as a Holder) from and
against any loss, claim, damage or liability, joint or several, or any action in
respect thereof (including, without limitation, any loss, claim, damage,
liability or action relating to purchases and sales of Securities, Exchange
Securities or Private Exchange Securities), to which that Holder may become
subject, whether commenced or threatened, under the Securities Act, the Exchange
Act, any other federal or state statutory law or regulation, at common law or
otherwise, insofar as such loss, claim, damage, liability or action arises out
of, or is based upon, (i) any untrue statement or alleged untrue statement of a
material fact contained in any such Registration Statement or any prospectus
forming part thereof or in any amendment or supplement thereto or (ii) the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, and shall
reimburse each Holder promptly upon demand for any legal or other expenses
reasonably incurred by that Holder in connection with investigating or defending
or preparing to defend against or appearing as a third party witness in
connection with any such loss, claim, damage, liability or action as such
expenses are incurred; provided, however, that the Company shall not be liable
in any such case to the extent that any such loss, claim, damage, liability or
action arises out of, or is based upon, an untrue statement or alleged untrue
statement in or omission or alleged omission from any of such documents in
reliance upon and in conformity with any Holders' Information; and provided,
further, that with respect to any such untrue statement in or omission from any
related preliminary prospectus, the indemnity agreement contained in this
Section 6(a) shall not inure to the benefit of any Holder from whom the person
asserting any such loss, claim, damage, liability or action received Securities,
Exchange Securities or Private Exchange Securities to the extent that such loss,
claim, damage, liability or action of or with respect to such Holder results
from the fact that both (A) a copy of the final prospectus was not sent or given
to such person at or prior to the written confirmation of the sale of such
Securities, Exchange Securities or Private Exchange Securities to such person
and (B) the untrue statement in or omission from the related preliminary
prospectus was corrected in the final prospectus unless, in either case, such
failure to deliver the final prospectus was a result of non-compliance by the
Company with Section 4(d), 4(e), 4(f) or 4(g).
13
(b) In the event of a Shelf Registration Statement, each Holder shall
indemnify and hold harmless the Company, its affiliates, its officers,
directors, employees, representatives and agents, and each person, if any, who
controls the Company within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act (collectively referred to for purposes of this
Section 6(b) and Section 7 as the Company), from and against any loss, claim,
damage or liability, joint or several, or any action in respect thereof, to
which the Company may become subject, whether commenced or threatened, under the
Securities Act, the Exchange Act, any other federal or state statutory law or
regulation, at common law or otherwise, insofar as such loss, claim, damage,
liability or action arises out of, or is based upon, (i) any untrue statement or
alleged untrue statement of a material fact contained in any such Registration
Statement or any prospectus forming part thereof or in any amendment or
supplement thereto or (ii) the omission or alleged omission to state therein a
material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, but in each case, only to the extent that the untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with any Holders' Information furnished to
the Company by such Holder, and shall reimburse the Company for any legal or
other expenses reasonably incurred by the Company in connection with
investigating or defending or preparing to defend against or appearing as a
third party witness in connection with any such loss, claim, damage, liability
or action as such expenses are incurred; provided, however, that no such Holder
shall be liable for any indemnity claims hereunder in excess of the amount of
net proceeds received by such Holder from the sale of Securities, Exchange
Securities or Private Exchange Securities pursuant to such Shelf Registration
Statement.
(c) Promptly after receipt by an indemnified party under this Section
6 of notice of any claim or the commencement of any action, the indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party pursuant to Section 6(a) or 6(b), notify the indemnifying
party in writing of the claim or the commencement of that action; provided,
however, that the failure to notify the indemnifying party shall not relieve it
from any liability which it may have under this Section 6 except to the extent
that it has been materially prejudiced (through the forfeiture of substantive
rights or defenses) by such failure; and provided, further, that the failure to
notify the indemnifying party shall not relieve it from any liability which it
may have to an indemnified party otherwise than under this Section 6. If any
such claim or action shall be brought against an indemnified party, and it shall
notify the indemnifying party thereof, the indemnifying party shall be entitled
to participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 6 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than the reasonable costs of investigation; provided, however,
that an indemnified party shall have the right to employ its own counsel in any
such action, but the fees, expenses and other charges of such counsel for the
indemnified party will be at the expense of such indemnified party unless (1)
the employment of counsel by the indemnified party has been authorized in
writing by the indemnifying party, (2) the indemnified
14
party has reasonably concluded (based upon advice of counsel to the indemnified
party) that there may be legal defenses available to it or other indemnified
parties that are different from or in addition to those available to the
indemnifying party, (3) a conflict or potential conflict exists (based upon
advice of counsel to the indemnified party) between the indemnified party and
the indemnifying party (in which case the indemnifying party will not have the
right to direct the defense of such action on behalf of the indemnified party)
or (4) the indemnifying party has not in fact employed counsel reasonably
satisfactory to the indemnified party to assume the defense of such action
within a reasonable time after receiving notice of the commencement of the
action, in each of which cases the reasonable fees, disbursements and other
charges of counsel will be at the expense of the indemnifying party or parties.
It is understood that the indemnifying party or parties shall not, in connection
with any proceeding or related proceedings in the same jurisdiction, be liable
for the reasonable fees, disbursements and other charges of more than one
separate firm of attorneys (in addition to any local counsel) at any one time
for all such indemnified party or parties. Each indemnified party, as a
condition of the indemnity agreements contained in Sections 6(a) and 6(b), shall
use all reasonable efforts to cooperate with the indemnifying party in the
defense of any such action or claim. No indemnifying party shall be liable for
any settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its written
consent or if there be a final judgment for the plaintiff in any such action,
the indemnifying party agrees to indemnify and hold harmless any indemnified
party from and against any loss or liability by reason of such settlement or
judgment. No indemnifying party shall, without the prior written consent of the
indemnified party (which consent shall not be unreasonably withheld), effect any
settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.
7. Contribution. If the indemnification provided for in Section 6 is
unavailable or insufficient to hold harmless an indemnified party under Section
6(a) or 6(b), then each indemnifying party shall, in lieu of indemnifying such
indemnified party, contribute to the amount paid or payable by such indemnified
party as a result of such loss, claim, damage or liability, or action in respect
thereof, (i) in such proportion as shall be appropriate to reflect the relative
benefits received by the Company from the offering and sale of the Securities,
on the one hand, and a Holder with respect to the sale by such Holder of
Securities, Exchange Securities or Private Exchange Securities, on the other, or
(ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company on the one hand and such Holder on the other with respect to the
statements or omissions that resulted in such loss, claim, damage or liability,
or action in respect thereof, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and a Holder on the other with respect to such offering and such sale shall be
deemed to be in the same proportion as the total net proceeds from the offering
of the Securities (before deducting expenses) received by or on behalf of the
Company as set forth in the table on the cover of the Offering Memorandum, on
the one hand, bear to the total proceeds received by such Holder with respect to
its sale of Securities, Exchange Securities or Private Exchange Securities, on
the other.
15
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to the Company or
information supplied by the Company on the one hand or to any Holders'
Information supplied by such Holder 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 parties hereto agree that it
would not be just and equitable if contributions pursuant to this Section 7 were
to be determined by pro rata allocation or by any other method of allocation
that does not take into account the equitable considerations referred to herein.
The amount paid or payable by an indemnified party as a result of the loss,
claim, damage or liability, or action in respect thereof, referred to above in
this Section 7 shall be deemed to include, for purposes of this Section 7, any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending or preparing to defend any such
action or claim. Notwithstanding the provisions of this Section 7, an
indemnifying party that is a Holder of Securities, Exchange Securities or
Private Exchange Securities shall not be required to contribute any amount in
excess of the amount by which the total price at which the Securities, Exchange
Securities or Private Exchange Securities sold by such indemnifying party to any
purchaser exceeds the amount of any damages which such indemnifying party has
otherwise paid or become liable to pay by reason of any untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
8. Rules 144 and 144A. So long as any Transfer Restricted Securities
remain outstanding, the Company shall use its reasonable best efforts to file
the reports required to be filed by them under the Securities Act and the
Exchange Act in a timely manner and, if at any time the Company is not required
to file such reports, it will, upon the written request of any Holder of
Transfer Restricted Securities, make publicly available other information so
long as necessary to permit sales of such Holder's securities pursuant to Rules
144 and 144A. The Company covenants that it will take such further action as any
Holder of Transfer Restricted Securities may reasonably request, all to the
extent required from time to time to enable such Holder to sell Transfer
Restricted Securities without registration under the Securities Act within the
limitation of the exemptions provided by Rules 144 and 144A (including, without
limitation, the requirements of Rule 144A(d)(4)). Upon the written request of
any Holder of Transfer Restricted Securities, the Company shall deliver to such
Holder a written statement as to whether it has complied with such requirements.
Notwithstanding the foregoing, nothing in this Section 8 shall be deemed to
require the Company to register any of its securities pursuant to the Exchange
Act.
9. Underwritten Registrations. If any of the Transfer Restricted
Securities covered by any Shelf Registration Statement are to be sold in an
underwritten offering, the investment banker or investment bankers and manager
or managers that will administer the offering will be selected by the Holders of
a majority in aggregate principal amount of such Transfer Restricted Securities
included in such offering, subject to the consent of the Company (which shall
not be unreasonably withheld or delayed), and such Holders shall be responsible
for all underwriting commissions and discounts in connection therewith.
16
No person may participate in any underwritten registration hereunder
unless such person (i) agrees to sell such person's Transfer Restricted
Securities on the basis reasonably provided in any underwriting arrangements
approved by the persons entitled hereunder to approve such arrangements and (ii)
completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents reasonably required under the terms
of such underwriting arrangements.
10. Miscellaneous. (a) Amendments and Waivers. The provisions of
this Agreement may not be amended, modified or supplemented, and waivers or
consents to departures from the provisions hereof may not be given, unless the
Company has obtained the written consent of Holders of a majority in aggregate
principal amount of the Securities, the Exchange Securities and the Private
Exchange Securities, taken as a single class. Notwithstanding the foregoing, a
waiver or consent to depart from the provisions hereof with respect to a matter
that relates exclusively to the rights of Holders whose Securities, Exchange
Securities or Private Exchange Securities are being sold pursuant to a
Registration Statement and that does not directly or indirectly affect the
rights of other Holders may be given by Holders of a majority in aggregate
principal amount of the Securities, the Exchange Securities and the Private
Exchange Securities being sold by such Holders pursuant to such Registration
Statement.
(b) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class
mail, telecopier or air courier guaranteeing next-day delivery:
(1) if to a Holder, at the most current address given by such Holder
to the Company in accordance with the provisions of this Section 10(b),
which address initially is, with respect to each Holder, the address of
such Holder maintained by the Registrar under the Indenture, with a copy in
like manner to each of the Initial Purchasers;
(2) if to an Initial Purchaser, initially at its address set forth in
the Purchase Agreement; and
(3) if to the Company, initially at the address of the Company set
forth in the Purchase Agreement.
All such notices and communications shall be deemed to have been duly
given: when delivered by hand, if personally delivered; one business day after
being delivered to a next-day air courier; five business days after being
deposited in the mail; and when receipt is acknowledged by the recipient's
telecopier machine, if sent by telecopier.
The Initial Purchasers and the Company, by notice to the other, may
designate additional or different addresses or telecopy numbers for subsequent
notices or communications.
(c) Successors And Assigns. This Agreement shall be binding upon the
Company and its successors and assigns.
17
(d) Counterparts. This Agreement may be executed in any number of
counterparts (which may be delivered in original form or by telecopier) and by
the parties hereto in separate counterparts, each of which when so executed
shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
(e) Definition of Terms. For purposes of this Agreement, (a) the term
"business day" means any day on which the New York Stock Exchange, Inc. is open
for trading, (b) the term "subsidiary" has the meaning set forth in Rule 405
under the Securities Act and (c) except where otherwise expressly provided, the
term "affiliate" has the meaning set forth in Rule 405 under the Securities Act.
(f) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(g) Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York.
(h) Remedies. In the event of a breach by the Company or any Holder
of any of their obligations under this Agreement, each Holder or the Company, as
the case may be, in addition to being entitled to exercise all rights granted by
law, including recovery of damages (other than the recovery of damages for a
breach by the Company of its obligations under Sections 1 or 2 hereof for which
additional interest have been paid pursuant to Section 3 hereof), will be
entitled to specific performance of its rights under this Agreement. The Company
and each Holder agree that monetary damages would not be adequate compensation
for any loss incurred by reason of a breach by it of any of the provisions of
this Agreement and hereby further agree that, in the event of any action for
specific performance in respect of such breach, it shall waive the defense that
a remedy at law would be adequate.
(i) No Inconsistent Agreements. The Company represents, warrants and
agrees that (i) it has not entered into, shall not, on or after the date of this
Agreement, enter into any agreement that is inconsistent with the rights granted
to the Holders in this Agreement or otherwise conflicts with the provisions
hereof, (ii) it has not previously entered into any agreement which remains in
effect granting any registration rights with respect to any of its debt
securities to any person and (iii) without limiting the generality of the
foregoing, without the written consent of the Holders of a majority in aggregate
principal amount of the then outstanding Transfer Restricted Securities, it
shall not grant to any person the right to request the Company to register any
debt securities of the Company under the Securities Act unless the rights so
granted are not in conflict or inconsistent with the provisions of this
Agreement.
(j) No Piggyback on Registrations. Neither the Company nor any of its
security holders (other than the Holders of Transfer Restricted Securities in
such capacity) shall have the right to include any securities of the Company in
any Shelf Registration or Registered Exchange Offer other than Transfer
Restricted Securities.
(k) Severability. The remedies provided herein are cumulative and not
exclusive of any remedies provided by law. If any term, provision, covenant or
restriction of this
18
Agreement is held by a court of competent jurisdiction to be invalid, illegal,
void or unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein shall remain in full force and effect and shall in
no way be affected, impaired or invalidated, and the parties hereto shall use
their reasonable best efforts to find and employ an alternative means to achieve
the same or substantially the same result as that contemplated by such term,
provision, covenant or restriction. It is hereby stipulated and declared to be
the intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such that may be
hereafter declared invalid, illegal, void or unenforceable.
19
Please confirm that the foregoing correctly sets forth the agreement
among the Company and the Initial Purchasers.
Very truly yours,
SMITHFIELD FOODS, INC.
By
-----------------
Name: C. XXXXX XXXX
Title: Vice President and Chief Financial
Officer
Accepted:
X.X. XXXXXX SECURITIES INC.
By
----------------
Authorized Signatory
XXXXXXX, XXXXX & CO.
By
-------------------------
(Xxxxxxx, Sachs & Co.)
ANNEX A
Each broker-dealer that receives Exchange Securities for its own
account pursuant to the Registered Exchange Offer must acknowledge that it will
deliver a prospectus in connection with any resale of such Exchange Securities.
The Letter of Transmittal states that by so acknowledging and by delivering a
prospectus, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act. This Prospectus, as it
may be amended or supplemented from time to time, may be used by a broker-dealer
in connection with resales of Exchange Securities received in exchange for
Securities where such Securities were acquired by such broker-dealer as a result
of market-making activities or other trading activities. The Company has agreed
that, for a period of 90 days after the Expiration Date (as defined herein), it
will make this Prospectus available to any broker-dealer for use in connection
with any such resale. See "Plan of Distribution."
ANNEX B
Each broker-dealer that receives Exchange Securities for its own
account in exchange for Securities, where such Securities were acquired by such
broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus in connection
with any resale of such Exchange Securities. See "Plan of Distribution."
ANNEX C
PLAN OF DISTRIBUTION
Each broker-dealer that receives Exchange Securities for its own
account pursuant to the Registered Exchange Offer must acknowledge that it will
deliver a prospectus in connection with any resale of such Exchange Securities.
This Prospectus, as it may be amended or supplemented from time to time, may be
used by a broker-dealer in connection with resales of Exchange Securities
received in exchange for Securities where such Securities were acquired as a
result of market-making activities or other trading activities. The Company has
agreed that, for a period of 90 days after the Expiration Date, they will make
this prospectus, as amended or supplemented, available to any broker-dealer for
use in connection with any such resale. In addition, until _______________,
200[], all dealers effecting transactions in the Exchange Securities may be
required to deliver a prospectus./1/
The Company will not receive any proceeds from any sale of Exchange
Securities by broker-dealers. Exchange Securities received by broker-dealers
for their own account pursuant to the Registered Exchange Offer may be sold from
time to time in one or more transactions in the over-the-counter market, in
negotiated transactions, through the writing of options on the Exchange
Securities or a combination of such methods of resale, at market prices
prevailing at the time of resale, at prices related to such prevailing market
prices or at negotiated prices. Any such resale may be made directly to
purchasers or to or through brokers or dealers who may receive compensation in
the form of commissions or concessions from any such broker-dealer or the
purchasers of any such Exchange Securities. Any broker-dealer that resells
Exchange Securities that were received by it for its own account pursuant to the
Registered Exchange Offer and any broker or dealer that participates in a
distribution of such Exchange Securities may be deemed to be an "underwriter"
within the meaning of the Securities Act and any profit on any such resale of
Exchange Securities and any commission or concessions received by any such
persons may be deemed to be underwriting compensation under the Securities Act.
The Letter of Transmittal states that, by acknowledging that it will deliver and
by delivering a prospectus, a broker-dealer will not be deemed to admit that it
is an "underwriter" within the meaning of the Securities Act.
For a period of 90 days after the Expiration Date the Company will
promptly send additional copies of this Prospectus and any amendment or
supplement to this Prospectus to any broker-dealer that requests such documents
in the Letter of Transmittal. The Company has agreed to pay all expenses
incident to the Registered Exchange Offer (including the expenses of one counsel
for the Holders of the Securities) other than commissions or concessions of any
broker-dealers and will indemnify the Holders of the Securities (including any
broker-dealers) against certain liabilities, including liabilities under the
Securities Act.
---------------------
/1/ In addition, the legend required by Item 502(e) of Regulation S-K will
appear on the back cover page of the Registered Exchange Offer prospectus.
ANNEX D
[ ] CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10
ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR
SUPPLEMENTS THERETO.
Name:_____________________________________________
Address:__________________________________________
__________________________________________
If the undersigned is not a broker-dealer, the undersigned represents that it is
not engaged in, and does not intend to engage in, a distribution of Exchange
Securities. If the undersigned is a broker-dealer that will receive Exchange
Securities for its own account, in exchange for Securities that were acquired as
a result of market-making activities or other trading activities, and it
acknowledges that it will deliver a prospectus in connection with any resale of
such Exchange Securities; however, by so acknowledging and by delivering a
prospectus, the undersigned will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.
ANNEX B
[Form of Opinion of Counsel for the Company]
McGuireWoods LLP shall have furnished to the Initial Purchasers their
written opinion, as counsel to the Company, addressed to the Initial Purchasers
and dated the Closing Date, in form and substance reasonably satisfactory to the
Initial Purchasers, substantially to the effect set forth below:
(i) the Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the Commonwealth of
Virginia, is duly qualified to do business and is in good standing as a
foreign corporation in each jurisdiction in which its ownership or lease of
property or the conduct of its business requires such qualification except
to the extent that the failure so to qualify or be in good standing would
not have a material adverse effect on the Company and its subsidiaries
taken as a whole, and has all corporate power and authority necessary to
own or hold its properties and to conduct its businesses substantially as
described in the Offering Memorandum;
(ii) the Company has an authorized capitalization as set forth in the
Offering Memorandum, and all of the outstanding shares of capital stock of
the Company have been duly and validly authorized and issued and are fully
paid and non-assessable; and the shareholders of the Company have no
preemptive rights;
(iii) each of the subsidiaries other than [list the foreign
subsidiaries -for Xxxxxxxxx Corporation, Canadian counsel should opine that
Smithfield owns 99% of the outstanding shares of Xxxxxxxxx] (the "Domestic
Subsidiaries") has been duly incorporated and is validly existing as a
corporation in good standing under the laws of its jurisdiction of
incorporation; has been duly qualified as a foreign corporation for the
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 to the extent that
the failure so to qualify or be in good standing would not have a material
adverse effect on the Company and its subsidiaries taken as a whole; and
all of the outstanding shares of capital stock of each of the Domestic
Subsidiaries have been duly and validly authorized and issued, are fully
paid and non-assessable, and are owned directly or indirectly by the
Company, free and clear of all perfected liens, encumbrances, equities or
claims and to such counsel's knowledge any other liens, encumbrances,
equities or claims;
(iv) the Purchase Agreement has been duly authorized, executed and
delivered by the Company;
(v) the Registration Rights Agreement has been duly authorized, executed
and delivered by the Company and constitutes a valid and legally binding
agreement of the Company enforceable against the Company in accordance with
its terms, subject to bankruptcy, insolvency, fraudulent conveyance,
reorganization,
2
moratorium and other similar laws relating to or affecting creditors'
rights generally and to general equitable principles (whether considered in
a proceeding in equity or at law); provided, however, that such counsel
does not opine as to the enforceability against the Company of any rights
to indemnification or contribution provided for therein;
(vi) the Indenture has been duly authorized, executed and delivered by
the Company and, assuming due authorization, execution and delivery thereof
by the Trustee, constitutes a valid and legally binding agreement of the
Company enforceable against the Company in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors'
rights generally and to general equitable principles (whether considered in
a proceeding in equity or at law);
(vii) the Securities have been duly authorized, executed and issued by
the Company and, assuming due authentication thereof by the Trustee and
upon payment and delivery in accordance with the Purchase Agreement, will
constitute valid and legally binding obligations of the Company entitled to
the benefits of the Indenture and enforceable against the Company in
accordance with their terms, subject to bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws relating to
or affecting creditors' rights generally and to general equitable
principles (whether considered in a proceeding in equity or at law);
(viii) the Exchange Securities have been duly authorized by the Company
and, when duly executed, authenticated, issued and delivered as provided in
the Indenture and contemplated by the Registration Rights Agreement
(assuming the Indenture is the valid and legally binding obligation of the
Trustee and due authentication of the Exchange Securities by the Trustee),
will constitute valid and legally binding obligations of the Company, as
issuer, entitled to the benefits of the Indenture and enforceable against
the Company, as issuer, in accordance with their terms, subject to
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
and other similar laws relating to or affecting creditors' rights generally
and to general equitable principles (whether considered in a proceeding in
equity or at law);
(ix) each Transaction Document conforms in all material respects to the
respective descriptions thereof contained in the Offering Memorandum;
(x) the execution, delivery and performance by the Company of its
obligations under each of the Transaction Documents, the issuance,
authentication, sale and delivery of the Securities and compliance by the
Company with the terms thereof and the consummation of the transactions
contemplated by the Transaction Documents 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 material agreement or instrument, in each case, 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, which breach, violation or default could reasonably be expected to
have a material adverse effect on the Company and its subsidiaries taken as
a whole,
3
nor will such actions result in any violation of the provisions of the
charter or by-laws (or other comparable organizational documents) of the
Company or any of its subsidiaries or any statute, judgment, order, decree,
rule or regulation known to such counsel of any court or arbitrator or
governmental agency or body having jurisdiction over the Company or any of
its subsidiaries or any of their properties or assets (other than the
securities and Blue Sky laws of the various states, as to which such
counsel expresses no opinion); and no consent, approval, authorization,
order, registration or qualification of or with, any such court or
governmental agency or body is required for the execution, delivery and
performance by the Company of each of the Transaction Documents to which it
is a party, the issuance, authentication, sale and delivery of the
Securities and compliance by the Company with the terms thereof and the
consummation of the transactions contemplated by the Transaction Documents,
except for such consents, approvals, authorizations, registrations or
qualifications (i) which have been obtained or made prior to the Closing
Date, (ii) as may be required under state securities and Blue Sky laws and
(iii) as may be required to be obtained or made under the Securities Act
and applicable state securities laws as contemplated by the Registration
Rights Agreement;
(xi) other than as set forth in the Offering Memorandum, nothing has
come to such counsel's attention that would lead them to believe that there
are any 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 (A) singularly or in the
aggregate, if determined adversely to the Company or any of its
subsidiaries, could reasonably be expected to have a material adverse
effect on the Company and its subsidiaries taken as a whole or (B)
questions the validity or enforceability of any of the Transaction
Documents or any action taken or to be taken pursuant thereto; and nothing
has come to their attention that would lead them to believe that any such
proceedings are threatened or contemplated by governmental authorities or
threatened by others;
(xii) to our knowledge neither the Company nor any of its subsidiaries
is (A) in violation of its charter or by-laws (or other comparable
organizational documents), (B) in default, and no event has occurred which,
with notice or lapse of time or both, would constitute such a default, in
the due performance or observance of any term, covenant or condition
contained in any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument to which it is a party or by which it is
bound or to which any of its property or assets is subject or (C) in
violation of any law, ordinance, governmental rule, regulation or court
decree to which it or its property or assets may be subject, which default
under clause (B) or violation under clause (C) could reasonably be expected
to have a material adverse effect on the Company and its subsidiaries taken
as a whole;
(xiii) assuming that the Securities are offered and sold in the manner
contemplated by, and in accordance with, this Agreement and the Offering
Memorandum, no registration of the Securities under the Securities Act or
qualification of the Indenture under the Trust Indenture Act is required in
connection with the issuance
4
and sale of the Securities by the Company and the offer, resale and
delivery of the Securities by the Initial Purchasers;
(xiv) the documents incorporated by reference or deemed to be
incorporated by reference in the Offering Memorandum (collectively, the
"Exchange Act Documents") complied as to form when filed in all material
respects with the requirements of the Exchange Act and the applicable rules
and regulations of the Commission thereunder, except that in each case such
counsel need express no opinion with the respect to the financial
statements or other financial data contained in or incorporated by
reference in or omitted from the Exchange Act Documents; and
(xv) the issuance of Exchangeable Shares of Smithfield Canada Limited, a
corporation organized under the Business Corporations Act (Ontario), as
amended, and a wholly-owned subsidiary of the Company ("Smithfield
Canada"), in connection with Smithfield Canada's acquisition of common
stock of Xxxxxxxxx Corporation, a corporation organized under the Business
Corporations Act (Ontario), as amended, did not constitute an Event of
Default under the Indenture, dated as of February 9, 1998, between the
Company and SunTrust Bank, Atlanta, a banking corporation duly organized
and existing under the laws of the State of Georgia, as trustee.
Such counsel shall also state that they have participated in conferences
with officers and other representatives of the Company, representatives of
Xxxxxx Xxxxxxxx LLP, independent auditors for the Company, the Initial
Purchasers and counsel for the Initial Purchasers, at which the contents of the
Preliminary Offering Memorandum and the Offering Memorandum and any amendment
thereof or supplement thereto and related matters were discussed, and, although
they have not undertaken to investigate or verify independently, and do not
assume any responsibility for the accuracy, completeness or fairness of the
statements contained in the Preliminary Offering Memorandum and the Offering
Memorandum or any amendment thereof or supplement thereto (except as expressly
stated in paragraph (x) above), no facts have come to such counsel's attention
which would lead them to believe that the Offering Memorandum and any amendment
thereof or supplement thereto as of its date (other than the historical, pro
forma or other financial statements, financial information and financial data
included or incorporated by reference therein, in each case as to which no
opinion need be given) contained any untrue statement of material fact or
omitted to state any material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading or that
the Offering Memorandum and any amendment thereof or supplement thereto at the
date of such opinion (other than the historical, pro forma or other financial
statements, financial information and financial data included or incorporated by
reference therein, in each case as to which no opinion need be given) includes
any untrue statement of a material fact or omits to state a material fact
necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading.
In rendering such opinion, such counsel may (A) rely in respect of matters
of fact upon certificates of the Company and of executive officers of the
Company and its subsidiaries and upon information obtained from public officials
and other sources believed by such counsel to be responsible, (B) state that
their opinion is limited to the laws of the Commonwealth of Virginia, the
General Corporation Law of the State of Delaware, the laws of the State of New
5
York and the federal laws of the United States, (C) rely, insofar as laws other
than the laws of the Commonwealth of Virginia, the General Corporation Law of
the State of Delaware, the laws of the State of New York and the federal laws of
the United States are concerned, solely on the opinions of local counsel
(provided that such counsel shall state that they believe that both the Initial
Purchasers and they are justified in relying upon such opinions) and may state
that their opinion is subject to the same qualifications and limitations
expressed in such opinions, (D) rely in respect of the opinions expressed in
clause (iii) upon reports of the Uniform Commercial Code search services and (E)
make other customary and reasonable assumptions.
Such opinion shall also state that the opinion is being rendered to the
Initial Purchasers pursuant to Section 5(c) of this Agreement and that such
opinion may not be relied upon by the Initial Purchasers for any other purpose,
or relied upon by, or furnished to, any other person, firm or corporation
without such counsel's prior consent, except that the law firm of Xxxxxxx
Xxxxxxx & Xxxxxxxx may rely upon such opinion with respect to matters of the
laws of the Commonwealth of Virginia, the State of Tennessee and the other
jurisdictions of incorporation of the Company's subsidiaries in connection with
the delivery of its opinions pursuant to Section 5(d) of this Agreement and the
Indenture.
