EXHIBIT 1.1
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THE GSI GROUP, INC.
$100,000,000
10-1/4% Senior Subordinated Notes due 2007
PURCHASE AGREEMENT
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Dated as of October 30, 1997
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$100,000,000
THE GSI GROUP, INC.
(a Delaware corporation)
10-1/4% Senior Subordinated Notes due 2007
PURCHASE AGREEMENT
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October 30, 1997
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxxx Xxxxxxx & Co. Incorporated
x/x Xxxxxxx Xxxxx & Xx.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
The GSI Group, Inc., a Delaware corporation (the "Company"), confirms
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its agreement with Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated ("Xxxxxxx Xxxxx") and Xxxxxx Xxxxxxx & Co. Incorporated
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(collectively, the "Initial Purchasers," which term shall also include any
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initial purchaser substituted as hereinafter provided in Section 11 hereof),
with respect to the issue and sale by the Company and the purchase by the
Initial Purchasers, acting severally and not jointly, of the respective
principal amounts set forth in Schedule A hereto of $100,000,000 aggregate
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principal amount of the Company's 10-1/4% Senior Subordinated Notes due 2007
(the "Securities"). The Securities are to be issued pursuant to an indenture
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dated as of November 1, 1997 (the "Indenture") between the Company and LaSalle
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National Bank, as trustee (the "Trustee"). The Securities will be issued in
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book-entry form will be issued to Cede & Co. as nominee of The Depository Trust
Company ("DTC") pursuant to a letter agreement, to be dated as of the Closing
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Time (as defined in Section 2(b) hereof) (the "DTC Agreement"), among the
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Company, the Trustee and DTC.
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The Company understands that the Initial Purchasers propose to make an
offering of the Securities on the terms and in the manner set forth herein and
agrees that the Initial Purchasers may resell, subject to the conditions set
forth herein, all or a portion of the Securities to purchasers ("Subsequent
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Purchasers") at any time after the date of this Agreement. The Securities are
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to be offered and sold through the Initial Purchasers without being registered
under the Securities Act of 1933, as amended (the "1933 Act"), in reliance upon
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exemptions therefrom. Pursuant to the terms of the Securities and the Indenture
investors that acquire Securities may only resell or otherwise transfer such
Securities if such Securities are hereafter registered under the 1933 Act or if
an exemption from the registration requirements of the 1933 Act is available
(including the exemption afforded by Rule 144A ("Rule 144A"), Rule 144
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("Rule 144") or Regulation S ("Regulation S") of the rules and regulations
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promulgated under the 1933 Act by the Securities and Exchange Commission (the
"Commission")).
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The Company has prepared and delivered to each Initial Purchaser
copies of a preliminary offering memorandum dated October 16, 1997 (the
"Preliminary Offering Memorandum") and has prepared and will deliver to each
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Initial Purchaser, on the date hereof or the next succeeding day, copies of a
final offering memorandum dated October 30, 1997 (the "Final Offering
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Memorandum"), each for use by such Initial Purchaser in connection with its
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solicitation of purchases of, or offering of, the Securities. "Offering
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Memorandum" means, with respect to any date or time referred to in this
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Agreement, the most recent offering memorandum (whether the Preliminary
Offering Memorandum or the Final Offering Memorandum, or any amendment or
supplement to either such document), including exhibits thereto, which has been
prepared and delivered by the Company to the Initial Purchasers in connection
with their solicitation of purchases of, or offering of, the Securities.
Capitalized terms not otherwise defined herein have the meanings given
such terms in the Offering Memorandum .
The holders of Securities (including the Initial Purchasers and their
direct and indirect transferees) will be en titled to the benefits of a
registration rights agreement, to be dated as of November 1, 1997 (the
"Registration Rights Agreement"), between the Company and the Initial
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Purchasers. Pursuant to the Registration Rights Agreement, the Company will
agree to file with the Commission under the circumstances set forth therein (i)
a registration statement under the 1933 Act registering the Exchange Securities
(as defined in the Regis-
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tration Rights Agreement) to be offered in exchange for the Securities and to
use its best efforts to cause such registration statement to be declared
effective and/or (ii) a shelf registration statement pursuant to Rule 415 under
the 1933 Act relating to the resale of the Securities by holders thereof or, if
applicable, relating to the resale of Private Exchange Securities (as defined
in the Registration Rights Agreement) by the Initial Purchasers and to use its
best efforts to cause such shelf registration statement to be declared
effective.
This Agreement, the Indenture, the Securities, the Exchange
Securities, the Private Exchange Securities and the Registration Rights
Agreement are sometimes referred to herein collectively as the "Operative
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Documents."
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All references in this Agreement to financial statements and
schedules and other information which is "contained," "included" or "stated" in
the Offering Memorandum (or other references of like import) shall be deemed to
mean and include all such financial statements and schedules and other
information which are incorporated by reference in the Offering Memorandum.
SECTION 1. Representations and Warranties.
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(a) The Company represents and warrants to each Initial Purchaser as
of the date hereof and as of the Closing Time, and agrees with each Initial
Purchaser as follows:
(i) Similar Offerings. The Company has not, directly or
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indirectly, solicited any offer to buy or offered to sell, and will not,
directly or indirectly, solicit any offer to buy or offer to sell, in the
United States or to any United States citizen or resident, any security
which is or would be integrated with the sale of the Securities in a manner
that would require the Securities to be registered under the 1933 Act.
(ii) The Preliminary Offering Memorandum as of its date did not,
and the Final Offering Memorandum as of the date hereof does not, and at
the Closing Time the Final 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
under which they were made, not misleading; provided, however, that this
representation, warranty and agreement shall not apply to statements in or
omissions from the Preliminary Offering Memorandum or the
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Final Offering Memorandum made in reliance upon and in conformity with
information furnished to the Company in writing by any Initial Purchaser
through Xxxxxxx Xxxxx expressly for use therein.
(iii) Xxxxxx Xxxxxxxx LLP and McGladrey & Xxxxxx, LLP who
certified the financial statements and supporting schedules included in the
Offering Memorandum with respect to the Company and its subsidiaries and
Xxxxx Manufacturing Co., respectively, are independent certified public
accountants within the meaning of Regulation S-X under the 1933 Act.
(iv) The financial statements, together with the related
schedules and notes, included in the Offering Memorandum present fairly in
all material respects the financial position of the Company and its
consolidated subsidiaries at the dates indicated and the statement of
operations, stockholders' equity and cash flows of the Company and its
consolidated subsidiaries and Xxxxx Manufacturing Co. for the periods
specified; said financial statements have been prepared in conformity with
generally accepted accounting principles ("GAAP") applied on a consistent
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basis throughout the periods involved. The supporting schedules, if any,
included in the Offering Memorandum present fairly in accordance with GAAP
the information required to be stated therein. The selected consolidated
financial data and the summary consolidated financial data included in the
Offering Memorandum present fairly the information shown therein and have
been compiled on a basis consistent with that of the audited financial
statements included in the Offering Memorandum. The statistical
information and other market-related data included in the Offering
Memorandum present fairly, in all material respects, the information and
data shown therein and are derived from sources the Company believes are
accurate in all material respects. The pro forma financial information
relating to the Company and its subsidiaries and the related notes thereto
included in the Offering Memorandum present fairly in all material respects
the in formation shown therein, have been prepared in all material
respects in accordance with the Commission's rules and guidelines with
respect to pro forma financial adjustments and have been properly computed
on the bases described therein, and the assumptions used in the
preparation thereof are reasonable and the adjustments used therein are
appropriate to give effect to the transactions and circumstances referred
to therein.
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(v) Since the respective dates as of which information is given
in the Offering Memorandum, except as otherwise stated therein, (A) there
has been no material adverse change in the condition, financial or
otherwise, or in the earnings or business affairs of the Company and its
subsidiaries (as defined in Section 1(a)(vii)) considered as one
enterprise, whether or not arising in the ordinary course of business (a
"Material Adverse Change"), and (B) there has been no dividend or
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distribution of any kind declared, paid or made by the Company on any class
of its capital stock, except for a dividend of $300,000 paid on its capital
stock on October 2, 1997 and the dividend described under "Use of
Proceeds."
(vi) The Company has been duly organized and is validly existing
as a corporation in good standing under the laws of the State of Delaware
and has corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Offering
Memorandum and to enter into and perform its obligations under the
Operative Documents; and the Company is duly qualified as a foreign
corporation to transact business and is in good standing in each other
jurisdiction in which such qualification is required, whether by reason of
the ownership or leasing of property or the conduct of business, except
where the failure so to qualify or to be in good standing could not
reasonably be expected to have a material adverse effect on the condition,
financial or otherwise, or on the earnings or business affairs of the
Company and its subsidiaries considered as one enterprise (a "Material
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Adverse Effect").
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(vii) Each "significant subsidiary" of the Company (as such term
is defined in Rule 1-02 of Regulation S-X (each, a "Subsidiary" and
collectively, the "Subsidiaries")) has been duly organized and is validly
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existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has corporate power and authority to
own, lease and operate its properties and to conduct its business as
described in the Offering Memorandum and is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason of
the ownership or leasing of property or the conduct of business, except
where the failure so to qualify or to be in good standing would not have a
Material Adverse Effect; except as otherwise disclosed in the Offering
Memorandum, all of the issued and outstanding
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capital stock of each Subsidiary has been duly authorized and validly
issued, is fully paid and non-assessable and is owned by the Company,
directly or through subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance or other claim; none of the outstanding
shares of capital stock of the Subsidiaries was issued in violation of any
preemptive or similar rights arising by operation of law, or under the
charter or by-laws of any Subsidiary or under any agreement to which the
Company or any Subsidiary is a party.
(viii) The authorized, issued and outstanding capital stock of
the Company is as set forth in the Offering Memorandum in the column
entitled "Actual" under the caption "Capitalization"; all of the issued and
outstanding capital stock of the Company has been duly authorized and
validly issued, is fully paid and non-assessable; none of the issued and
outstanding shares of capital stock of the Company was issued in violation
of any preemptive rights or similar rights arising by operation of law or
under the charter or by-laws of the Company or under any agreement to which
the Company is a party.
(ix) This Agreement has been duly authorized, executed and
delivered by the Company.
(x) The Indenture has been duly authorized by the Company and,
at the Closing Time, will have been duly executed and delivered by the
Company and will constitute a valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency (including,
without limitation, all laws relating to fraudulent transfers),
reorganization, moratorium or other similar laws relating to or affecting
enforcement of creditors' rights generally or by general principles of
equity (regardless of whether enforcement is considered in a proceeding in
equity or at law).
(xi) The Registration Rights Agreement has been duly authorized
by the Company and, at the Closing Time, will have been duly executed and
delivered by the Company and will constitute a valid and binding agreement
of the Company, enforceable against the Company in accordance with its
terms, except (i) as the enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or other similar laws relating
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to or affecting enforcement of creditors' rights generally or by general
principles of equity (regardless of whether enforcement is considered in a
proceeding in equity or at law) and (ii) as the enforcement of rights to
indemnification and contribution thereunder may be limited by federal or
state securities laws or regulations or the public policy underlying such
laws or regulations.
(xii) The Securities have been duly authorized by the Company
and, at the Closing Time, will have been duly executed by the Company and,
when authenticated in the manner provided for in the Indenture and
delivered against payment of the purchase price therefor as provided in
this Agreement, will constitute valid and binding obligations of the
Company, enforceable against the Company in accordance with their terms,
except as the enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or other similar laws relating to or
affecting enforcement of creditors' rights generally, or by general
principles of equity (regardless of whether enforcement is considered in a
proceeding in equity or at law), and will be in the form contemplated by,
and entitled to the benefits of, the Indenture.
(xiii) The Exchange Securities and the Private Exchange
Securities have been duly authorized by the Company and, when executed by
the Company and authenticated in the manner provided for in the Indenture
and delivered in exchange for the Securities in accordance with the terms
of the Registration Rights Agreement, will constitute valid and binding
obligations of the Company, enforceable against the Company in accordance
with their terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all laws relating
to fraudulent transfers), reorganization, moratorium or other similar laws
relating to or affecting enforcement of creditors' rights generally, or by
general principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law), and will be in the form
contemplated by, and entitled to the benefits of, the Indenture.
(xiv) The Securities, the Exchange Securities, the Registration
Rights Agreement and the Indenture will conform in all material respects
to the respective descriptions thereof contained in the Offering
Memorandum.
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(xv) Neither the Company nor any of the Subsidiaries is in
violation of its charter or by-laws or in default in the performance or
observance of any obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, deed of trust, loan or credit
agreement, note, lease or other agreement or instrument to which the
Company or any of the Subsidiaries is a party or by which any of them may
be bound, or to which any of the property or assets of the Company or any
of the Subsidiaries is subject (collectively, the "Agreements and
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Instruments"), except for such defaults that could not reasonably be
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expected to have, individually or in the aggregate, a Material Adverse
Effect; and the execution, delivery and performance of each of the
Operative Documents and any other agreement or instrument entered into or
issued or to be entered into or issued by the Company in connection with
the transactions contemplated hereby or thereby or in the Offering
Memorandum and the consummation of the transactions contemplated herein
and in the Offering Memorandum (including the issuance and sale of the
Securities and the use of the proceeds from the sale of the Securities as
described in the Offering Memorandum under the caption "Use of Proceeds"
and the issuance and delivery of the Exchange Securities and the Private
Exchange Securities, if any) and compliance by the Company with its
obligations hereunder and thereunder have been duly authorized by all
necessary corporate action and do not and will not, whether with or
without the giving of notice or passage of time or both, conflict with or
constitute a breach of, or default or a Repayment Event (as defined below)
under, or a violation of or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the Company or
any of the Subsidiaries pursuant to, the Agreements and Instruments, except
for such breaches, defaults, violations, liens, charges or encumbrances
that, individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect, nor will such action result in any
violation of the provisions of the charter or by-laws of the Company or any
of the Subsidiaries or any applicable law, statute, rule, regulation,
judgment, order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over the
Company or any of its subsidiaries or any of their respective assets or
properties, except for any such violation that could not reasonably be
expected to result in a Material Adverse Effect. As used herein, a
"Repayment Event" means any event or condition which gives the holder of
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any note, debenture or other
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evidence of indebtedness (or any person acting on such holder's behalf) the
right to require the repurchase, redemption or repayment of all or a
portion of such indebtedness by the Company or any of the Subsidiaries.
(xvi) No labor dispute with the employees of the Company or any
of the Subsidiaries exists or, to the knowledge of the Company, is
imminent, and the Company is not aware of any existing or imminent labor
disturbance by the employees of any of its or any of the Subsidiaries'
principal suppliers, manufacturers, customers or contractors, which, in
any case, could reasonably be expected to result in a Material Adverse
Effect.
(xvii) Except as disclosed in the Offering Memorandum, there is
no action, suit, proceeding, inquiry or investigation before or by any
court or governmental agency or body, domestic or foreign, now pending, or,
to the knowledge of the Company, threatened, against or affecting the
Company or any of the Subsidiaries or any of their respective properties
or assets which could reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect, or which could reasonably be
expected to materially and adversely affect the properties or assets of the
Company or any of the Subsidiaries or the performance by the Company of its
obligations under the Operative Documents. Any pending legal or
governmental proceedings to which the Company or any of the Subsidiaries
is a party or of which any of their respective properties or assets is the
subject which are not described in the Offering Memorandum, including
ordinary routine litigation incidental to the business, could not
reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.
(xviii) The Company and the Subsidiaries own or possess, or can
acquire on reasonable terms, adequate patents, patent rights, licenses,
inventions, copyrights, know-how (including trade secrets and other
unpatented and/or unpatentable proprietary or confidential information,
systems or procedures), trademarks, service marks, trade names or other
intellectual property (collectively, "Intellectual Property") necessary to
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carry on the business now operated by them, and neither the Company nor
any of the Subsidiaries has received any notice or is other wise aware of
any infringement of or conflict with asserted rights of others with
respect to any Intellectual Property or of any facts or circumstances which
would ren-
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der any Intellectual Property invalid or inadequate to protect the interest
of the Company or any of the Subsidiaries therein, and which infringement
or conflict (if the subject of any unfavorable decision, ruling or finding)
or invalidity or inadequacy could reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.
(xix) No filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of, any court or
governmental authority or agency is necessary or required in connection
with the offering, issuance or sale of the Securities, the Exchange
Securities or the Private Exchange Securities, the performance by the
Company of its obligations under the Operative Documents or the
consummation of the transactions contemplated thereby, except as may be
required under the 1933 Act, under the Trust Indenture Act of 1939, as
amended (the "1939 Act") or pursuant to state securities or "blue sky"
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laws.
(xx) The Company and the Subsidiaries possess such permits,
licenses, approvals, consents and other authorizations (collectively,
"Governmental Licenses") issued by the appropriate federal, state, local or
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foreign regulatory agencies or bodies necessary to conduct the business
now operated by them, except where the failure to possess any Governmental
Licenses, individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect; the Company and the
Subsidiaries are in compliance with the terms and conditions of all such
Governmental Licenses, except where the failure so to comply could not
reasonably be expected to, individually or in the aggregate, have a
Material Adverse Effect; all of the Governmental Licenses are valid and in
full force and effect, except when the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full force
and effect could not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect; neither the Company nor any of the
Subsidiaries has received any notice of proceedings relating to the
revocation or modification of any such Governmental Licenses that, if the
subject of an unfavorable decision, ruling or finding, could not reasonably
be expected to have, individually or in the aggregate, a Material Adverse
Effect.
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(xxi) Neither the Company nor any of the Subsidiaries is in
violation of any law, ordinance, administrative or governmental rule or
regulation or court decree applicable to it or any of its properties or
assets, except for such violations that could not reasonably be expected
to, individually or in the aggregate, have a Material Adverse Effect.
(xxii) The Company and the Subsidiaries have good and
marketable title to all real and other property owned by the Company and
the Subsidiaries, in each case, after giving effect to the transactions
contemplated herein, free and clear of all mortgages, pledges, liens,
security interests, claims, restrictions or encumbrances of any kind,
except such as (a) are described in the Offering Memorandum or (b) do not,
individually or in the aggregate, materially affect the value of such
property and do not interfere with the use made and proposed to be made
(including the sale thereof) of such property by the Company or any of the
Subsidiaries; and all of the leases and subleases material to the business
of the Company and the Subsidiaries, considered as one enterprise, and
under which the Company or any of the Subsidiaries holds properties de
scribed in the Offering Memorandum, are in full force and effect, and
neither the Company nor any of the Subsidiaries has any written notice of
any material claim that has been asserted by anyone adverse to the rights
of the Company or any of the Subsidiaries under any of the leases or
subleases mentioned above.
(xxiii) The Company and the Subsidiaries have filed all federal,
state, local and foreign tax returns required to be filed or have duly
requested extensions thereof and have paid all taxes required to be paid by
any of them and any related assessments, fines or penalties, except for any
such tax, assessment, fine or penalty that is being contested in good faith
and by appropriate proceedings and for which adequate reserves have been
made in accordance with GAAP; and adequate charges, accruals and reserves
have been provided for in the financial statements included in the
Offering Memorandum in respect of all federal, state, local and foreign
taxes for all periods as to which the tax liability of the Company or any
of the Subsidiaries has not been finally determined or remains open to
examination by applicable taxing authorities.
(xxiv) Other than as disclosed in the Offering Memorandum,
none of the Company or the Subsidiaries have any
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profit sharing, deferred compensation, stock option, stock purchase or
similar plans or agreements evidencing rights to purchase securities or to
share in the profits of the Company or any of the Subsidiaries, which would
be required to be described in or included as an exhibit to a registration
statement on Form S-1 under the 1933 Act.
(xxv) Except as described in the Offering Memorandum and except
as could not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect, (A) neither the Company nor any of
the Subsidiaries is in violation of, or has received any written notice
that it is subject to liability under, any federal, state, local or foreign
statute, law, rule, regulation, ordinance, code, or rule of common law and
any judicial or ad ministrative interpretation thereof including any
judicial or administrative order, decree, judgment or injunction, relating
to pollution or protection of human health or the environment (including,
without limitation, ambient air, indoor air, surface water, groundwater,
land surface or subsurface strata and natural resources), or wildlife,
including, without limitation, those relating to the release or threatened
release of chemicals, pollutants, contaminants, wastes, toxic substances,
hazardous substances or constituents, petroleum or petroleum products or
any other substances or materials subject to regulation under
Environmental Laws (collectively, "Hazardous Materials") or to the
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manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials (collectively, "Environmental
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Laws"), (B) the Company and the Subsidiaries have, or have filed timely
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application for, all permits, licenses, authorizations and approvals
required under any applicable Environmental Laws and are each in compliance
with their requirements, (C) there are no pending or, to the knowledge of
the Company, threatened administrative, regulatory or judicial actions,
suits, demands, demand letters, claims, liens, notices of noncompliance,
violation or potential responsibility or liability, investigation or
proceedings pursuant to any Environmental Law against the Company or any of
the Subsidiaries, and (D) there are no past or present events, conditions
or circumstances which would reasonably be expected to form the basis of an
order for clean-up or remediation, or an action, suit or proceeding by any
private party or governmental agency, against or affecting, or requiring
capital or operating expenditures by, the Company or any of the
Subsidiaries pursuant to any Environmental Laws.
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(xxvi) Except as described in the Offering Memorandum, neither
the Company nor any of the Subsidiaries has incurred any liability for any
prohibited transaction or funding deficiency or any complete or partial
withdrawal liability with respect to any pension, profit sharing or other
plan which is subject to the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), to which the Company or the Subsidiaries makes
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or ever has made a contribution and in which any employee of the Company or
any such Subsidiary is or has ever been a participant, which in the
aggregate could reasonably be expected to have a Material Adverse Effect.
With respect to such plans, each of the Company and the Subsidiaries is in
compliance in all respects with all applicable provisions of ERISA, except
where the failure to so comply could not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.
(xxvii) The Company is not, and upon the issuance and sale of
the Securities as herein contemplated and the application of the net
proceeds therefrom as described in the Offering Memorandum, will not be, an
"investment company" or an entity "controlled" by an "investment company"
as such terms are defined in the Investment Company Act of 1940, as amended
(the "1940 Act").
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(xxviii) The Securities are eligible for resale pursuant to
Rule 144A and will not be, at the Closing Time, of the same class as
securities listed on a national securities exchange registered under
Section 6 of the Securities Exchange Act of 1934, as amended (the "1934
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Act"), or quoted on a U.S. automated interdealer quotation system.
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(xxix) None of the Company, its Affiliates (as defined in Rule
503 under the 1933 Act), or any person acting on its or any of their
behalf (other than the Initial Purchasers, as to which the Company makes no
representation) has engaged or will engage, 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 1933 Act or has
offered or will offer prior to the Closing Time (as defined in Section 2(b)
hereof) the Securities in any manner involving a public offering within the
meaning of Section 4(2) of the 1933 Act.
(xxx) Subject to compliance by the Initial Purchasers with
the representations and warranties contained in
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Section 2(c) and the procedures set forth in Section 6 hereof, it is not
necessary in connection with the offer, sale and delivery of the Securities
to the Initial Purchasers and to each Subsequent Purchaser in the manner
contemplated by this Agreement and the Offering Memorandum to register the
Securities under the 1933 Act or to qualify the Indenture under the 1939
Act.
(xxxi) With respect to those Securities sold in reliance on
Regulation S, (A) none of the Company, its Affiliates or any person acting
on its or their behalf (other than the Initial Purchasers, as to whom the
Company makes no representation) has engaged or will engage in any
directed selling efforts within the meaning of Regulation S and (B) each of
the Company and its Affiliates and any person acting on its or their behalf
(other than the Initial Purchasers, as to whom the Company makes no
representation) has complied and will comply with the offering
restrictions requirement of Regulation S.
(xxxii) Neither the consummation of the transactions
contemplated hereby nor the sale, issuance, execution or delivery of the
Securities, nor the application of the proceeds therefrom (if applied as
described in the Offering Memorandum under the caption "Use of Proceeds"),
will violate Regulation G, T, U or X of the Board of Governors of the
Federal Reserve System, in each case as in effect, or as the same may
hereafter be in effect, at the Closing Time.
(xxxiii) Neither the Company nor any of the Subsidiaries nor
any of their respective directors, officers or controlling persons has
taken, directly or indirectly, any action designed, or which might
reasonably be expected to cause or result, under the 1934 Act, in, or which
has constituted, stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the
Securities, the Exchange Securities or the Private Exchange Securities.
(b) Any certificate signed by any officer of the Company or any of
the Subsidiaries delivered to the Initial Purchasers or to counsel for the
Initial Purchasers shall be deemed a representation and warranty by the Company
to each Initial Purchaser as to the matters covered thereby.
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SECTION 2. Sale and Delivery to Initial Purchasers; Closing.
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(a) On the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, the Company
agrees to sell to each Initial Purchaser, severally and not jointly, and each
Initial Purchaser, severally and not jointly, agrees to purchase from the
Company, at the price set forth in Schedule B hereto, the aggregate principal
----------
amount of Securities set forth in Schedule A hereto opposite the name of such
----------
Initial Purchaser, plus any additional principal amount of Securities such
Initial Pur chaser may become obligated to purchase pursuant to the provisions
of Section 11 hereof.
(b) Payment of the purchase price for, and delivery of certificates
in definitive form for, the Securities shall be made at the offices of Xxxxx
Xxxxx & Xxxxx, 000 Xxxxx XxXxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx, or at such other
place as shall be agreed upon by Xxxxxxx Xxxxx and the Company, at 9:00 A.M.,
Central Standard Time, on November 5, 1997 (unless postponed in accordance with
the provisions of Section 11), or such other time not later than ten business
days after such date as shall be agreed upon by Xxxxxxx Xxxxx and the Company
(such time and date of payment and delivery being herein called the "Closing
-------
Time").
----
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery in
accordance with the DTC Agreement to Xxxxxxx Xxxxx for the respective accounts
of the Initial Purchasers of certificates for the Securities to be purchased
by them. It is understood that each Initial Purchaser has authorized Xxxxxxx
Xxxxx, for its account, to accept delivery of, receipt for, and make payment of
the purchase price for, the Securities which it has agreed to purchase. Xxxxxxx
Xxxxx, individually and not as representative of the Initial Purchasers, may
(but shall not be obligated to) make payment of the purchase price for the
Securities to be purchased by any Initial Purchaser whose funds have not been
received by, the Closing Time, but such payment shall not relieve such Initial
Purchaser from its obligations hereunder. The certificates representing the
Securities shall be registered in such names and in such denominations ($1,000
or integral multiples thereof) as the Initial Purchasers may request not later
than 10:00 A.M., New York City time, on the second business day prior to the
Closing Time and shall be made available for ex amination and packaging by the
Initial Purchasers in Xxx Xxxx,
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Xxx Xxxx not later than 10:00 A.M, New York City time, on the last business day
prior to the Closing Time.
(c) Each Initial Purchaser, severally and not jointly, represents and
warrants to, and agrees with, the Company that it is a "qualified institutional
buyer" within the meaning of Rule 144A under the 1933 Act (a "Qualified
---------
Institutional Buyer").
-------------------
SECTION 3. Covenants of the Company. The Company covenants with
------------------------
each Initial Purchaser as follows:
(a) The Company has furnished or, as promptly as possible, will
furnish to each Initial Purchaser, without charge, such number of copies of
the Preliminary Offering Memorandum, the Final Offering Memorandum and any
amendments and supplements thereto as such Initial Purchaser may
reasonably request.
(b) The Company will immediately notify each Initial Purchaser, and
confirm such notice in writing, of (x) any filing made by the Company of
information relating to the offering of the Securities with any securities
exchange or any other regulatory body in the United States or any other
jurisdiction. If prior to the completion of the placement of the
Securities by the Initial Purchasers as evidenced by a notice in writing
from the Initial Purchasers to the Company (from the date hereof to such
completion, the "Offering Period"), any event shall occur as a result of
---------------
which it is necessary, in the reasonable opinion of the Company, its
counsel, the Initial Purchasers or counsel for the Initial Purchasers, to
amend or supplement the Offering Memorandum in order that the Offering
Memorandum not include any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in
the light of the circumstances then existing, not misleading or if, in the
opinion of the Company, its counsel, the Initial Purchasers, or counsel
for the Initial Purchasers, such amendment or supplement is necessary to
comply with applicable law, the Company will (subject to Section 3(c)
hereof) forthwith amend or supplement the Offering Memorandum by preparing
and furnishing to each Initial Purchaser an amendment or amendments of, or
a supplement or supplements to, the Offering Memorandum (in such number as
the Initial Purchasers may reasonably request), at its own expense, so
that, as so amended or supplemented, the Offering Memorandum will not
include an untrue statement of a material fact or
-17-
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 Subsequent Purchaser, not misleading or so that the Offering
Memorandum, as so amended or supplemented, shall comply with applicable
law, as the case may be.
(c) The Company will advise each Initial Purchaser promptly of any
proposal to amend or supplement the Offering Memorandum during the
Offering Period and will not effect such amendment or supplement without
the prior written consent of the Initial Purchasers. Neither the consent
of the Initial Purchasers, nor the Initial Purchasers' delivery of any
such amendment or supplement, shall constitute a waiver of any of the
conditions set forth in Section 5 hereof.
(d) The Company will use its best efforts, in cooperation with the
Initial Purchasers, to qualify the Securities for offering and sale under
the applicable securities laws of such jurisdictions as the Initial
Purchasers may designate and will maintain such qualifications in effect
as long as required for the resale of the Securities by the Initial
Purchasers as contemplated herein; provided, however, that the Company
shall not be obligated to file any general consent to service of process or
to qualify as a foreign corporation or as a dealer in securities in any
jurisdiction in which it is not so qualified or to subject itself to
taxation in respect of doing business in any jurisdiction in which it is
not otherwise so subject.
(e) The Company shall take all reasonable action necessary to enable
Standard & Poor's Ratings Group, a division of McGraw Hill, Inc. ("S&P"),
---
and Xxxxx'x Investors Service, Inc. ("Moody's") to provide their respective
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credit ratings of the Securities.
(f) The Company will cooperate with the Initial Purchasers and use
its best efforts to permit the Securities to be eligible for clearance and
settlement through the facilities of DTC and to be designated as "PORTAL
Securities" in accordance with the rules and regulations of the National
Association of Securities Dealers, Inc. ("NASD").
----
(g) The Company will use the net proceeds received by it from the
sale of the Securities in the manner specified in the Offering Memorandum
under the heading "Use of Proceeds."
-18-
(h) The Company agrees that, in order to render the Securities
eligible for resale pursuant to Rule 144A under the 1933 Act, unless the
Company furnishes information to the Commission pursuant to Section 13 or
15(d) of the 1934 Act, so long as any of the Securities, including the Ex
change Securities and Private Exchange Securities, remain outstanding and
not subject to an effective registration statement under the 1933 Act, it
will make available, upon request, to any holder of Securities or
prospective pur chasers of Securities the information specified in Rule
144A(d)(4) (such information, whether made available to holders or
prospective purchasers or furnished to the Commission, is herein referred
to as "Additional Information").
-----------------------
(i) In connection with the original distribution of the Securities,
the Company agrees that, prior to any offer or resale of the Securities by
the Initial Purchasers, the Initial Purchasers and counsel for the Initial
Purchasers shall have the right to make reasonable inquiries into the
business of the Company and the Subsidiaries. The Company also agrees to
provide answers to each prospective Subsequent Purchaser of Securities who
so requests concerning the Company and the Subsidiaries (to the extent
that such information is available or can be acquired and made available
to prospective Subsequent Purchasers without unreasonable effort or
expense and to the extent the provision thereof is not prohibited by
applicable law and would not involve the disclosure of confidential
information of the Company) and the terms and conditions of the offering
of the Securities, as provided in the Offering Memorandum.
(j) Until the expiration of two years after the original issuance of
the Securities, the Company will not, and will cause its Affiliates not to,
purchase or agree to purchase or otherwise acquire any Securities which are
"restricted securities" (as such term is defined under Rule 144(a)(3) under
the 1933 Act), whether as beneficial owner or otherwise (except as agent
acting as a securities broker on behalf of and for the account of customers
in the ordinary course of business in unsolicited broker's transactions)
unless, upon any such purchase, the Company or any such Affiliate shall
submit such Securities to the Trustee for cancellation.
(k) During a period of 180 days from the date of the Offering
Memorandum, the Company will not, without the
-19-
prior written consent of Xxxxxxx Xxxxx, directly or indirectly, issue,
sell, offer or agree to sell, grant any option for the sale of, or
otherwise dispose of, any other debt securities of the Company or
securities of the Company convertible into, or exchangeable for, the
Securities or such other debt securities, except for the Exchange
Securities and the Private Exchange Securities.
SECTION 4. Payment of Expenses.
-------------------
(a) The Company will pay all expenses incident to the performance of
its obligations under this Agreement, including (i) the preparation, printing
and any filing of the Preliminary Offering Memorandum and the Final Offering
Memorandum (including financial statements and any schedules or exhibits) and
of each amendment or supplement thereto, (ii) the photocopying or printing and
delivery to the Initial Purchasers of this Agreement, any Agreement among
Initial Purchasers, the Indenture, the Registration Rights Agreement and such
other documents as may be required in connection with the offering, purchase,
sale and delivery of the Securities, the Exchange Securities and the Private
Exchange Securities, (iii) the preparation, issuance and delivery of the
certificates for the Securities, the Exchange Securities and the Private
Exchange Securities to the Initial Purchasers, including any charges of DTC in
connection therewith, (iv) the fees and disbursements of the Company's counsel,
accountants and other advisors, (v) the qualification of the Securities under
securities laws in accordance with the provisions of Section 3(d) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
the Initial Purchasers in connection therewith and in connection with the
preparation of the Blue Sky Survey, any supplement thereto and any Legal
Investment Survey, (vi) the reasonable fees and expenses of the Trustee,
including the reasonable fees and disbursements of counsel for the Trustee in
connection with the Indenture and the Securities, the Exchange Securities and
the Private Exchange Securities, (vii) any fees payable in connection with the
rating of the Securities, (viii) all expenses and fees in connection with the
application for designation by the NASD of the Securities as PORTAL securities
(ix) and one half of all expenses (including travel expenses) of the Company in
connection with any meetings with prospective investors in the Securities.
(b) If this Agreement is terminated by Xxxxxxx Xxxxx in accordance
with the provisions of Section 5 hereof or Section 10(a)(i) hereof, the Company
shall reimburse the Initial Purchasers for all of their reasonable out-of-pocket
expenses,
-20-
including the reasonable fees and disbursements of counsel for the Initial
Purchasers. The Company shall not in any event be liable to the Initial
Purchasers for the loss of anticipated profits from the transactions
contemplated by this Agreement.
SECTION 5. Conditions of Initial Purchasers' Obligations. The
---------------------------------------------
obligations of the several Initial Purchasers hereunder are subject to the
accuracy of the representations and warranties of the Company contained in
Section 1 hereof or in certificates of any officer of the Company or any of the
Subsidiaries delivered pursuant to the provisions hereof as of the date of this
Agreement and the Closing Time, to the performance by the Company of its
covenants and other obligations hereunder, and to the following further
conditions:
(a) At the Closing Time, the Representatives shall have received the
favorable opinion, dated as of the Closing Time, of each of Xxxx Xxxx, General
Counsel of the Company (with respect to the matters set forth in paragraphs
(iii) through (v), paragraph (xii), paragraph (xvii) and the penultimate
paragraph of Exhibit A hereto) and Xxxxx Xxxxx & Xxxxx, special counsel for the
Company (with respect to the matters set forth in paragraphs (i) and (ii),
paragraphs (vi) through (xi), paragraphs (xiii) through (xvi), paragraphs
(xviii) through (xx) and the penultimate paragraph of Exhibit A hereto), in form
and substance satisfactory to counsel for the Initial Purchasers, together with
signed or reproduced copies of each such letter for each of the other Initial
Purchasers, to the effect substantially set forth in Exhibit A hereto.
---------
(b) At the Closing Time, the Representatives shall have received the
favorable opinion, dated as of the Closing Time, of Xxxxxx Xxxxxx & Xxxxxxx,
counsel for the Initial Purchasers, together with signed or reproduced copies
of such letter for each of the other Initial Purchasers, with respect to the
matters set forth in paragraphs (vii) through (xi), inclusive, paragraph
(xviii) and the penultimate paragraph of Exhibit A hereto. In giving such
---------
opinion, such counsel may rely, as to all matters governed by the laws of
jurisdictions other than the law of the State of New York, the federal law of
the United States and the General Corporation Law of the State of Delaware, upon
the opinions of counsel satisfactory to the Representatives. Such counsel may
also state that, insofar as such opinion involves factual matters, they have
relied, to the extent they deem proper, upon certificates of officers of the
Company and the Subsidiaries and certificates of public officials.
-21-
(c) At the Closing Time, there shall not have been, since the date
hereof or since the respective dates as of which information is given in the
Offering Memorandum, any Material Adverse Change, and the Initial Purchasers
shall have received a certificate of the President or a Vice President of the
Company and of the chief financial or chief accounting officer of the Company,
dated as of the Closing Time, to the effect that (i) there has been no such
Material Adverse Change, (ii) the representations and warranties in Section 1
hereof are true and correct with the same force and effect as though expressly
made at and as of the Closing Time and (iii) the Company has complied with all
agreements and satisfied all conditions on its part to be performed or satisfied
at or prior to the Closing Time.
(d) At the time of the execution of this Agreement, the Initial
Purchasers shall have received from each of Xxxxxx Xxxxxxxx LLP and McGladrey &
Xxxxxx, LLP a letter dated such date, in form and substance satisfactory to the
Initial Purchasers and counsel for the Initial Purchasers, together with signed
or reproduced copies of such letter for each of the other Initial Purchasers,
containing statements and information of the type ordinarily included in
accountants' "comfort letters" to Initial Purchasers with respect to the
financial statements and certain financial information contained in the Offering
Memorandum.
(e) At the Closing Time, the Representatives shall have received from
each of Xxxxxx Xxxxxxxx LLP and McGladrey & Xxxxxx, LLP a letter, dated as of
the Closing Time, in form and substance satisfactory to the Initial Purchasers
and counsel for the Initial Purchasers, to the effect that they reaffirm the
statements made in their respective letters furnished pursuant to subsection
(d) of this Section 5, except that the specified date referred to shall be a
date not more than three business days prior to the Closing Time.
(f) At the Closing Time, the Securities shall be rated at least B2 by
Moody's and B by S&P, and the Company shall have delivered to the Initial
Purchasers a letter dated the Closing Time, from each such rating agency, or
other evidence satisfactory to the Representatives, confirming that the
Securities have such ratings; and since the date of this Agreement, there shall
not have occurred any downgrading in the rating assigned to the Securities or
any of the Company's other securities by any nationally recognized securities
rating agency, and no such securities rating agency shall have publicly
announced that it has under surveillance or review, with
-22-
possible negative implications, its rating of the Securities or any of the
Company's other securities.
(g) At the Closing Time, the Securities shall have been designated
for trading on PORTAL.
(h) The Company and the Trustee shall have entered into the
Indenture.
(i) The Company and the Initial Purchasers shall have entered into
the Registration Rights Agreement.
(j) At the Closing Time, counsel for the Initial Purchasers shall
have been furnished with such documents and opinions as they may reasonably
require for the purpose of enabling them to pass upon the issuance and sale of
the Securities as herein contemplated, or in order to evidence the accuracy of
any of the representations or warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings taken by the Company in
connection with the issuance and sale of the Securities as herein contemplated
shall be reasonably satisfactory in form and substance to the Initial Purchasers
and counsel for the Initial Purchasers.
If any condition specified in this Section 5 shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by Xxxxxxx Xxxxx by notice to the Company at any time at or prior to the Closing
Time, and such termination shall be without liability of any party to any other
party except as provided in Section 4 and except that Sections 1, 7, 8, 12, 13
and 14 shall survive any such termination and remain in full force and effect.
SECTION 6. Subsequent Offers and Resales of the Securities.
-----------------------------------------------
(a) Each of the Initial Purchasers and the Company hereby establish
and agree to observe the following procedures in connection with the offer and
sale by the Initial Purchasers of the Securities:
(i) Offers and sales of the Securities will be made only by the
Initial Purchasers or affiliates thereof qualified to do so in the
jurisdictions in which such offers or sales are made. Each such offer or
sale shall only be made (A), in the case of Securities resold or otherwise
transferred pursuant to Rule 144A, to persons whom the offeror or seller
reasonably believes to be Qualified
-23-
Institutional Buyers or (B) to non-U.S. persons outside the United States
to whom the offeror or seller reasonably believes offers and sales of the
Securities may be made in reliance upon Regulation S under the 1933 Act.
(ii) The Securities will be offered by approaching prospective
Subsequent Purchasers on an individual basis. No general solicitation or
general advertising (within the meaning of Rule 502(c) under the 0000 Xxx)
will be used in the United States in connection with the offering of the
Securities.
(iii) In the case of a non-bank Subsequent Purchaser of a
Security acting as a fiduciary for one or more third parties, in connection
with an offer and sale to such purchaser pursuant to clause (i) above,
each third party shall, in the judgment of the applicable Initial Pur
chaser, be a Qualified Institutional Buyer or a non-U.S. person outside the
United States.
(iv) Each Initial Purchaser acknowledges and will take
reasonable steps to inform, and cause each of its United States affiliates
to take reasonable steps to inform, persons acquiring Securities from such
Initial Purchaser or affiliate, as the case may be, in the United States
that the Securities (A) have not been and will not be registered under the
1933 Act, (B) are being sold to them without registration under the 1933
Act in reliance on Rule 144A or Regulation S under the 1933 Act and (C) may
not be offered, sold or otherwise transferred prior to (x) the date which
is two years (or such shorter time as is permitted by Rule 144(k) under the
1933 Act or any successor provision thereunder) after the later of the
date of the original issue of the Securities and the last date on which the
Company or any affiliate of the Company was the owner of such Securities or
any predecessor thereto or (y) such later date, if any, as may be required
by applicable law, except (1) to the Company, (2) for so long as such
Securities are eligible for resale pursuant to Rule 144A, to a person it
reasonably believes is a Qualified Institutional Buyer that purchases such
Securities for its own account or for the account of a Qualified
Institutional Buyer to whom notice is given that the transfer is being made
in reliance on Rule 144A, (3) pursuant to offers and sales to persons who
are not U.S. Persons (as defined in Regulation S under the 0000 Xxx) that
occur outside the United States pursuant to Regulation S under the 1933
Act, (4) pursuant to an effective registration state-
-24-
ment under the 1933 Act or (5) pursuant to another available exemption
from the registration requirements of the 1933 Act.
(v) No sale of the Securities to any one Subsequent Purchaser
will be for less than $100,000 principal amount and no Security will be
issued in a smaller principal amount. If any Subsequent Purchaser is a
non-bank fiduciary acting on behalf of others, each person for whom it is
acting must purchase at least $100,000 principal amount of the Securities.
(vi) The transfer restrictions and the other provisions set
forth in the Indenture, including the legend required thereby, shall apply
to the Securities except as otherwise agreed by the Company and the Initial
Purchasers. Following the sale of the Securities by the Initial
Purchasers to Subsequent Purchasers pursuant to and in compliance with the
terms hereof, the Initial Purchasers shall not be liable or responsible to
the Company for any losses, damages or liabilities suffered or incurred by
the Company, including any losses, damages or liabilities under the 1933
Act, arising from or relating to any resale or transfer of any Security
occurring after such sale by the Initial Purchasers.
(vii) Each Initial Purchaser will deliver to each purchaser of
the Securities from such Initial Purchaser, in connection with its original
distribution of the Securities, a copy of the Offering Memorandum, as
amended and supplemented at the date of such delivery.
(b) Each Initial Purchaser understands that the Securities have not
been and will not be registered under the 1933 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 in accordance with Regulation S or Rule 144A under the 1933 Act
or pursuant to an exemption from the registration requirements of the 1933 Act.
Each Initial Purchaser represents and agrees, that, except as permitted by
Section 6(a) above, it has offered and sold Securities and will offer and sell
Securities (i) as part of its distribution at any time and (ii) otherwise
until forty days after the later of the date upon which the offering of the
Securities commences and the Closing Time, only in accordance with Rule 903 of
Regulation S or Rule 144A under the 1933 Act. Accordingly, neither the Initial
Purchasers, their affiliates nor any persons acting on their behalf have
engaged or will engage in any directed selling efforts
-25-
with respect to Securities, and the Initial Purchasers, their affiliates and any
person acting on their behalf have complied and will comply with the offering
restriction requirements of Regulation S. Each Initial Purchaser agrees that, at
or prior to confirmation of a sale of Securities (other than a sale of
Securities pursuant to Rule 144A), it will have sent to each distributor, dealer
or person receiving a selling concession, fee or other remuneration that
purchases Securities from it or through it during the restricted period a
confirmation or notice to substantially the following effect:
"The Securities covered hereby have not been registered under
the United States Securities Act of 1933 (the "Securities Act")
--------------
and may not be offered 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 and (ii) otherwise until forty days
after the later of the date upon which the offering of the
Securities commenced and the date of closing, except in either
case in accordance with Regulation S or Rule 144A under the
Securities Act. Terms used above have the meaning given to them
by Regulation S."
Terms used in the above paragraph have the meanings given to them by Regulation
S.
Each Initial Purchaser severally represents and agrees that it has not
entered and will not enter into any contractual arrangements with respect to
the distribution of the Securities, except with its affiliates or with the prior
written consent of the Company.
SECTION 7. Indemnification.
---------------
(a) The Company agrees to indemnify and hold harmless each Initial
Purchaser and each person, if any, who controls any Initial Purchaser within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as
follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in any Preliminary
Offering Memorandum or the Final Offering Memorandum (or any amendment or
supplement thereto), or the omission or alleged omission therefrom of a
material fact necessary in order to make
-26-
the statements therein, in the light of the circumstances under
which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount paid
in settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided, however, that (subject to
Section 7(d) below) any such settlement is effected with the written
consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the reasonable fees and disbursements of counsel chosen as
provided in Section 7(c) below), reasonably incurred in investigating,
preparing or defending against any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened, or
any claim whatsoever based upon any such untrue statement or omission, or
any such alleged untrue state ment or omission, to the extent that any such
expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Initial Purchaser through Xxxxxxx Xxxxx expressly for use in the Offering
Memorandum (or any amendment or supplement thereto) and provided, further, that
this indemnity agreement shall not inure to the benefit of any Initial Purchaser
from whom the person asserting any such loss, liability, claim, damage or
expense purchased Securities, or any person controlling such Initial Purchaser,
if a copy of the Final Memorandum (or the Final Memorandum as amended or
supplemented) was not sent or given by or on behalf of the Initial Purchasers
(and the Company shall have timely furnished the Initial Purchasers with
sufficient copies thereof) to such person at or prior to the time of delivery of
written confirmation of the sale of the Securities to such person and if the
Final Memorandum (or the Final Memorandum as amended or supplemented) corrected
the untrue statement or omission giving rise to such loss, liability, claim,
damage or expense.
-27-
(b) Each Initial Purchaser severally agrees to indemnify and hold
harmless the Company, its directors and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act against any and all loss, liability, claim, damage and expense
described in the indemnity contained in subsection (a) of this Section 7, as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Preliminary Offering Memorandum or
the Final Offering Memorandum (or any amendment or supplement thereto) in
reliance upon and in conformity with written information furnished to the
Company by such Initial Purchaser through Xxxxxxx Xxxxx expressly for use in the
Preliminary Offering Memorandum or the Final Offering Memorandum (or any
amendment or supple ment thereto).
(c) Each indemnified party shall give notice as promptly as
reasonably practicable to each indemnifying party of any action commenced
against it in respect of which indemnity may be sought hereunder, but failure
to so notify an indemnifying party shall not relieve such indemnifying party
from any liability hereunder to the extent it is not materially prejudiced as a
result thereof and in any event shall not relieve it from any liability which
it may have otherwise than on account of this indemnity agreement. In the case
of parties indemnified pursuant to Section 7(a) above, counsel to the
indemnified parties shall be selected by Xxxxxxx Xxxxx, and, in the case of
parties indemnified pursuant to Section 7(b) above, counsel to the indemnified
parties shall be selected by the Company. An indemnifying party may participate
at its own expense in the defense of any such action; provided, however, that
counsel to the indemnifying party shall not (except with the consent of the
indemnified party) also be counsel to the indemnified party. In no event shall
the indemnifying parties be liable for fees and expenses of more than one
counsel (in addition to any local counsel) separate from their own counsel for
all indemnified parties in connection with any one action or separate but
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances. No indemnifying party shall, without the
prior written consent of the indemnified parties, settle or compromise or
consent to the entry of any judgment with respect to any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever in respect of which indemnification or
contribution could be sought under this Section 7 or Section 8 hereof (whether
or not the indemnified parties are actual or potential parties thereto), unless
such settlement, compromise or consent (i) in-
-28-
cludes an unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim and (ii) does
not include a statement as to or an admission of fault, culpability or a failure
to act by or on behalf of any indemnified party.
(d) If at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel to which such indemnified party is entitled pursuant to Section 7(a) or
(b), such indemnifying party agrees that it shall be liable for any settlement
of the nature contemplated by Section 7(a)(ii) effected without its written
consent if (i) such settlement is entered into more than 45 days after receipt
by such indemnifying party of the aforesaid request, (ii) such indemnifying
party shall have received notice of the terms of such settlement at least 30
days prior to such settlement being entered into and (iii) such indemnifying
party shall not have reimbursed such indemnified party in accordance with such
request prior to the date of such settlement.
SECTION 8. Contribution. If the indemnification provided for in
------------
Section 7 hereof is for any reason unavailable to or insufficient to hold
harmless an indemnified party in respect of any losses, liabilities, claims,
damages or expenses referred to therein, then each indemnifying party shall
contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by such indemnified party, as incurred, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Initial Purchasers on the other hand from the
offering of the Securities pursuant to this Agreement or (ii) if the allocation
provided by clause (i) is not permitted by applicable law, in such proportion as
is appropriate to reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the Company on the one hand and of the
Initial Purchasers on the other hand in connection with the statements or
omissions which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company, on the one hand, and
the Initial Purchasers, on the other hand, in connection with the offering of
the Securities pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the
Securities pursuant to this Agreement (before deducting expenses)
-29-
received by the Company, and the total discount received by the Initial
Purchasers, bear to the aggregate initial offering price of the Securities.
The relative fault of the Company, on the one hand, and the Initial
Purchasers, on the other hand, shall be determined by reference to, among other
things, whether any such untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Initial Purchasers and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
The Company and the Initial Purchasers agree that it would not be just
and equitable if contribution pursuant to this Section 8 were determined by pro
rata allocation (even if the Initial Purchasers were treated as one entity for
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above in this Section 8. The
aggregate amount of losses, liabilities, claims, damages and expenses incurred
by an indemnified party and referred to above in this Section 8 shall be deemed
to include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged
untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 8, no Initial Purchaser
shall be required to contribute any amount in excess of the amount by which the
total price at which the Securities purchased by it and offered to Subsequent
Purchasers exceeds the amount of any damages which such Initial Purchaser has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the 0000 Xxx) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 8, each person, if any, who controls an
Initial Purchaser within the meaning of Section 15 of the 1933 Act or Section 20
of the 1934 Act shall have the same rights to contribution as such Initial
Purchaser, and each director of the Company and each person, if any, who
controls
-30-
the Company within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as the Company. The
Initial Purchasers' respective obligations to contribute pursuant to this
Section 8 are several in proportion to the principal amount of Securities set
forth opposite their respective names in Schedule A hereto and not joint.
----------
SECTION 9. Representations, Warranties and Agreements to Survive
-----------------------------------------------------
Delivery. All representations, warranties and agreements contained in this
--------
Agreement or in certificates of officers of the Company submitted pursuant
hereto, shall remain operative and in full force and effect, regardless of any
investigation made by or on behalf of any Initial Purchaser or controlling
person, or by or on behalf of the Company, and shall survive delivery of the
Securities to the Initial Purchasers.
SECTION 10. Termination of Agreement.
------------------------
(a) Xxxxxxx Xxxxx may terminate this Agreement, by notice to the
Company, at any time at or prior to the Closing Time (i) if there has been,
since the time of execution of this Agreement or since the respective dates as
of which information is given in the Offering Memorandum, any Material Adverse
Change, (ii) if there has occurred any material adverse change in the financial
markets in the United States, any outbreak of hostilities or escalation thereof
or other calamity or crisis or any change or development involving a prospective
change in national or international political, financial or economic
conditions, in each case the effect of which is such as to make it, in the
judgment of Xxxxxxx Xxxxx, impracticable to market the Securities or to enforce
contracts for the sale of the Securities, (iii) if trading in any securities of
the Company has been suspended or limited by the Commission, if trading
generally on the American Stock Exchange or the New York Stock Exchange or in
the Nasdaq National Market System has been suspended or limited, or minimum or
maximum prices for trading have been fixed, or maximum ranges for prices have
been required, by any of said exchanges or by such system or by order of the
Commission, the NASD or any other governmental authority, or (iv) if a banking
moratorium has been declared by either Federal or New York authorities.
(b) If this Agreement is terminated pursuant to this Section 10, such
termination shall be without liability of any party to any other party except as
provided in Section 4 hereof, and provided further that Sections 1, 7, 8, 12, 13
and
-31-
14 shall survive such termination and remain in full force and effect.
SECTION 11. Default by One of the Initial Purchasers. If one of the
-----------------------------------------
Initial Purchasers shall fail at the Closing Time to purchase the Securities
which it is obligated to purchase under this Agreement (the "Defaulted
---------
Securities"), Xxxxxxx Xxxxx shall have the right, within 24 hours thereafter,
----------
to make arrangements for the non-defaulting Initial Purchaser, or any other
Initial Purchaser, to purchase all, but not less than all, of the Defaulted
Securities in such amounts as may be agreed upon and upon the terms herein set
forth; if, however, Xxxxxxx Xxxxx shall not have completed such arrangements
within such 24-hour period, then this Agreement shall terminate without
liability on the part of the non-defaulting Initial Purchaser.
No action taken pursuant to this Section 11 shall relieve any
defaulting Initial Purchaser from liability in respect of its default.
In the event of any such default which does not result in a
termination of this Agreement, either Xxxxxxx Xxxxx or the Company shall have
the right to postpone the Closing Time for a period not exceeding seven days in
order to effect any required changes in the Offering Memorandum or in any other
documents or arrangements. As used herein, the term "Initial Purchaser"
-----------------
includes any person substituted for an Initial Purchaser under this Section 11.
SECTION 12. Notices. All notices and other communications hereunder
-------
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the Initial
Purchasers shall be directed to Xxxxxxx Xxxxx at Xxxxx Xxxxx, Xxxxx Xxxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, attention: High Yield Corporate Finance;
and notices to the Company shall be directed to it at 0000 Xxxx Xxxxxxxx Xxxxxx,
Xxxxxxxxxx, Xxxxxxxx 00000, attention: Xxxx X. Xxxx, Chief Financial Officer
and General Counsel, with a copy to Xxxxx Xxxxx & Xxxxx, 000 Xxxxx XxXxxxx
Xxxxxx, Xxxxxxx, Xxxxxxxx 00000, attention: Xxxx X. Xxxxxx.
SECTION 13. Information Supplied by the Initial Purchasers. The
----------------------------------------------
statements set forth in the last paragraph on the cover page of the Offering
Memorandum, in the first paragraph on page i of the Offering Memorandum and in
the table and the third and fifth paragraphs under the heading "Plan of
-32-
Distribution" in the Offering Memorandum constitute the only information
furnished by the Initial Purchasers to the Company for use in the Offering
Memorandum for the purposes of Sections 1, 7 and 8 hereof.
SECTION 14. Parties. This Agreement shall inure to the benefit of
-------
and be binding upon the Initial Purchasers and the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
Initial Purchasers and the Company and their respective successors and the
controlling persons and directors referred to in Sections 7 and 8 hereof and
their heirs and legal representatives, any legal or equitable right, remedy or
claim under or in respect of this Agreement or any provision herein contained.
This Agreement and all conditions and provisions hereof are intended to be for
the sole and exclusive benefit of the Initial Purchasers and the Company and
their respective successors, and said controlling persons and directors and
their heirs and legal representatives, and for the benefit of no other person,
firm or corporation. No purchaser of Securities from any Initial Purchaser
shall be deemed to be a successor by reason merely of such purchase.
SECTION 15. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED
----------------------
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF. ALL SPECIFIED TIMES OF
DAY REFER TO NEW YORK CITY TIME.
SECTION 16. Effect of Headings. The Section headings herein are for
------------------
convenience only, and shall not affect the construction hereof.
SECTION 17. Counterparts. This Agreement may be executed in one or
------------
more counterparts and, when each party has executed a counterpart, all such
counterparts taken together shall constitute one and the same agreement.
[Signature Pages Follow]
S-1
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument, along with all counterparts, will become a binding
agreement between the Initial Purchasers and the Company in accordance with its
terms.
Very truly yours,
THE GSI GROUP, INC.
By: /s/ Xxxx X. Xxxx
----------------------------------------
Name: Xxxx X. Xxxx
Title: Executive V.P., CFO and Secretary
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX XXXXX & CO.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
XXXXXX XXXXXXX & CO. INCORPORATED
By: Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
By:_____________________________
Name:
Title:
S-1
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument, along with all counterparts, will become a binding
agreement between the Initial Purchasers and the Company in accordance with its
terms.
Very truly yours,
THE GSI GROUP, INC.
By:________________________________________
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX XXXXX & CO.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
XXXXXX XXXXXXX & CO. INCORPORATED
By: Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
SCHEDULE A
----------
Principal
Amount of
Name of Initial Purchaser Securities
------------------------- ----------
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated.................................. $ 70,000,000
Xxxxxx Xxxxxxx & Co. Incorporated......................... 30,000,000
----------
Total..................................................... $100,000,000
===========
SCHEDULE B
----------
THE GSI GROUP, INC.
$100,000,000 Senior Subordinated Notes Due 2007
1. The initial offering price of the Securities shall be 99.231% of
the principal amount thereof, plus accrued interest, if any, from the date of
issuance.
2. The purchase price to be paid by the Initial Purchasers for the
Securities shall be 96.481% of the principal amount thereof.
3. The interest rate on the Securities shall be 10-1/4% per annum.
4. The Securities will mature on November 1, 2007. Interest on the
Notes will be payable in arrears semi-annually on each May 1 and November 1,
commencing May 1, 1998.
5. The Securities will be redeemable at the option of the Company, in
whole or in part, at any time on or after November 1, 2002, at the redemption
prices (expressed as percentages of principal amount) set forth below, plus
accrued and unpaid interest thereon, if any, to the date of redemption, if
redeemed during the 12-month period beginning on November 1 of the years
indicated below:
REDEMPTION
YEAR PRICE
---- ----------
2002 105.188%
2003 103.458%
2004 101.729%
2005 and thereafter.............. 100.000%
6. On or prior to November 1, 2000, the Company may, at its option,
use the net proceeds of an Equity Offering (as defined in the Offering
Memorandum) to redeem up to 35% of the originally issued aggregate principal
amount of the Securities, at a redemption price in cash equal to 110.25% of the
principal amount thereof, plus accrued and unpaid interest thereon, if any, to
the date of redemption; provided, however, that not less than $65.0 million in
aggregate principal amount of Securities is outstanding following such
redemption.
Exhibit A
---------
FORM OF OPINIONS
TO BE DELIVERED PURSUANT TO
SECTION 5(a)
(i) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of Delaware.
(ii) The Company has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the Offering
Memorandum and to enter into and perform its obligations under the Operative
Documents.
(iii) The Company is duly qualified as a foreign corporation to
transact business and is in good standing in each other jurisdiction in which
such qualification is required.
(iv) The authorized, issued and outstanding capital stock of the
Company is as set forth in the Offering Memorandum in the column entitled
"Actual" under the caption "Capitalization"; the shares of issued and
outstanding capital stock of the Company have been duly authorized and validly
issued and are fully paid and nonassessable.
(v) Each Subsidiary has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the jurisdiction of
its incorporation, has corporate power and authority to own, lease and operate
its properties and to conduct its business as described in the Offering
Memorandum and is duly qualified as a foreign corporation to transact business
and is in good standing in each other jurisdiction in which such qualification
is required; all the issued and outstanding shares of capital stock of each
Subsidiary have been duly authorized and validly issued, are fully paid and non-
assessable and, to the best of our knowledge, are owned by the Company, directly
or indirectly, free and clear of any security interest, mortgage, pledge, lien,
encumbrance, claim or equity.
(vi) The Purchase Agreement has been duly authorized, executed and
delivered by the Company.
A-1
(vii) The Indenture has been duly authorized, executed and delivered
by the Company and (assuming the due authorization, execution and delivery
thereof by the Trustee) constitutes a valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms, except
as the enforcement thereof may be limited by bankruptcy, insolvency (including,
without limitation, all laws relating to fraudulent transfers), reorganization,
moratorium or other similar laws relating to or affecting enforcement of
creditors' rights generally, or by general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity or at law).
(viii) The Registration Rights Agreement has been duly authorized,
executed and delivered by the Company and (assuming the due authorization,
execution and delivery thereof by the Initial Purchasers) constitutes a valid
and binding agreement of the Company, enforceable against the Company in
accordance with its terms, except (i) as the enforcement thereof may be limited
by bankruptcy, insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or other similar laws relating
to or affecting enforcement of creditors' rights generally, or by general
principles of equity (regardless of whether enforcement is considered in a
proceeding in equity or at law) and (ii) as the enforcement of rights to
indemnification and contribution thereunder may be limited by federal or state
securities laws or regulations or the public policy underlying such laws or
regulations.
(ix) The Securities are in the form contemplated by the Indenture,
have been duly authorized by the Company and, when executed by the Company and
authenticated by the Trustee in the manner provided in the Indenture (assuming
the due authorization, execution and delivery of the Indenture by the Trustee)
and delivered against payment of the purchase price therefor, will constitute
valid and binding obligations of the Company entitled to the benefits of the
Indenture, enforceable against the Company in accordance with their terms,
except as the enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent transfers),
reorganization, moratorium or other similar laws relating to or affecting
enforcement of creditors' rights generally, or by general principles of equity
(regardless of whether enforcement is considered in a proceeding in equity or
at law).
A-2
(x) The Exchange Securities and the Private Exchange Securities
have been duly authorized by the Company and, when executed by the Company and
authenticated in the manner provided for in the Indenture and delivered in
exchange for the Securities in accordance with the terms of the Registration
Rights Agreement, will constitute valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms and entitled to
the benefits of the Indenture, except as the enforcement thereof may be limited
by bankruptcy, insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or other similar laws relating
to or affecting enforcement of creditors' rights generally, or by general
principles of equity (regardless of whether enforcement is considered in a
proceeding in equity or at law).
(xi) The Securities, the Indenture and the Registration Rights
Agreement conform in all material respects to the descriptions thereof contained
in the Offering Memorandum.
(xii) The execution, delivery and performance of each of the
Operative Documents and the consummation of the transactions contemplated
thereby (including the issuance and sale of the Securities and the use of the
proceeds therefrom as described in the Offering Memorandum under the caption
"Use Of Proceeds") and compliance by the Company with its obligations thereunder
will not, whether with or without the giving of notice or lapse of time or
both, conflict with or constitute a breach of, or default or Repayment Event (as
defined in Section l(a)(xvi) of the Purchase Agreement) under, or a violation
of, or result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or any Subsidiary pursuant to, (i)
any contract, indenture, mortgage, deed of trust, loan or credit agreement,
note, lease or any other agreement or instrument, known to us, to which the
Company or any of the Subsidiaries is a party or by which it or any of them may
be bound, or to which any of the property or assets of the Company or any
Subsidiary is subject, (ii) the charter or bylaws of the Company or any of the
Subsidiaries, or (iii) any applicable law, statute, rule or regulation of the
United States, the State of New York or the State of Delaware, or any judgment,
order, writ or decree, known to us, of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over the
Company or any of the Subsidiaries or any of their respective properties or
assets.
(xiii) No filing with, or authorization, approval, consent, license,
order, registration, qualification or decree
A-3
of, any court or governmental authority or agency is necessary or required in
connection with the offering, issuance or sale of the Securities, the Exchange
Securities or the Private Exchange Securities, the performance by the Company
of its obligations under the Operative Documents or the consummation of the
transactions contemplated thereby, except as may be required under the 1933
Act, under the 1939 Act or pursuant to state securities or "blue sky" laws, as
to which no opinion is rendered hereby.
(xiv) To the best of our knowledge, there is no pending or
threatened action, suit, proceeding, inquiry or investigation (collectively,
"Legal Proceedings"), to which the Company or any Subsidiary is a party, or to
-------------------
which the property of the Company or any Subsidiary is subject, before or by any
court or governmental agency or body, which might reasonably be expected to
result in a Material Adverse Effect, or which might reasonably be expected to
materially and adversely affect the properties or assets of the Company or any
Subsidiary or the consummation of the Purchase Agreement by the Company or its
obligations thereunder or the transactions contemplated by the Offering
Memorandum.
(xv) The information in the Offering Memorandum under the headings
"Business--Regulatory and Environmental Matters" and "Business--Product
Liability and Legal Proceedings," to the extent that it constitutes summaries of
legal matters, legal proceedings or legal conclusions, fairly summarizes such
matters in all material respects.
(xvi) All descriptions in the Offering Memorandum of contracts and
other documents to which the Company or any of the Subsidiaries is a party are
accurate in all material respects.
(xvii) To the best of our knowledge, there are no franchises,
contracts, indentures, mortgages, loan agreements, notes, leases or other
instruments that would be required to be described in a registration statement
on Form S-1 under the 1933 Act that are not described or referred to in the
Offering Memorandum.
(xviii) Assuming compliance by the Initial Purchasers with the
representations and warranties in Section 2(c) of the Purchase Agreement and the
procedures set forth in Section 6 of the Purchase Agreement, it is not necessary
in connection with the offer, sale and delivery of the Securities to the Initial
Purchasers and to each Subsequent Purchaser in the manner con-
A-4
templated by the Purchase Agreement and the Offering Memorandum to register the
Securities under the 1933 Act or to qualify the Indenture under the 1939 Act.
(xix) The Company is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in the 0000
Xxx.
(xx) Neither the consummation of the transactions contemplated
hereby nor the sale, issuance, execution or delivery of the Securities, nor the
application of the proceeds therefrom (if applied as described in the Offering
Memorandum under the caption "Use of Proceeds"), will violate Regulation G, T, U
or X of the Board of Governors of the Federal Reserve System.
We have participated in conferences with officers and other
representatives of the Company, your representatives and representatives of the
independent accountants for the Company at which conferences the contents of the
Offering Memorandum and related matters were discussed. However, we do not
express an opinion with respect to, and do not assume any responsibility for,
the accuracy, completeness or fairness of the statements contained in the
Offering Memorandum or make any representation that we have independently
verified or checked the accuracy, completeness or fairness of such statements.
On the basis of and subject to the foregoing, we advise you that nothing has
come to our attention that has led us to believe that the Final Offering
Memorandum, as of its date or as of the date hereof, included or includes an
untrue statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading (it being understood
that we express no belief with respect to the financial statements, including
the notes thereto, or any other financial or statistical data set forth or
referred to in the Offering Memorandum).
In rendering such opinion, such counsel may rely, as to matters of
fact (but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials. Such
opinion shall not state that it is to be governed or qualified by, or that it is
otherwise subject to, any treatise, written policy or other document relating to
legal opinions, including, without limitation, the Legal Opinion Accord of the
ABA Section of Business Law (1991).
A-5
