Exhibit 10.9
EXECUTION COPY
$155,000,000
ICON HEALTH & FITNESS, INC.
11.25% Senior Subordinated Notes due 2012
PURCHASE AGREEMENT
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March 28, 2002
CREDIT SUISSE FIRST BOSTON CORPORATION
X. X. XXXXXX SECURITIES INC.
FLEET SECURITIES, INC.
c/o Credit Suisse First Boston Corporation,
As Representative of the Several Purchasers
Eleven Xxxxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000-0000
Dear Sirs:
1. Introductory. ICON Health & Fitness, Inc., a Delaware corporation
(the "Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the several initial purchasers named in Schedule A hereto (the
"Initial Purchasers") $155,000,000 principal amount of its 11.25% Senior
Subordinated Notes due 2012 (the "Offered Securities") to be issued under an
indenture, dated as of April 9, 2002 (the "Indenture"), between the Company, the
Guarantors (as defined below) and The Bank of New York, as Trustee on a private
placement basis pursuant to an exemption under Section 4(2) of the United States
Securities Act of 1933, as amended (the "Securities Act"). The Company's
obligations under the Offered Securities, including the due and punctual payment
of interest on the Offered Securities, shall be unconditionally guaranteed (the
"Guarantee") by Jumpking, Inc., a Utah corporation ("Jumpking"), Universal
Technical Services, a Utah corporation ("UTS"), ICON International Holdings,
Inc., a Delaware corporation ("ICON International"), ICON IP, Inc., a Delaware
corporation ("ICON IP"), Free Motion Fitness, Inc., a Utah corporation ("Free
Motion"), NordicTrack, Inc., a Utah corporation ("NordicTrack"), 510152 N.B.
Ltd., a New Brunswick corporation ("N.B. Ltd.") and ICON du Canada Inc., a
Quebec corporation ("ICON Canada", whose Guarantee shall consist of the
guarantee of the obligations of N.B. Ltd., which in turn will undertake,
pursuant to its Guarantee, to guarantee the Company's obligations under the
Offered Securities), and each of the Company's future domestic subsidiaries
(each, a "Guarantor"; ICON International and ICON IP, together,
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the "Delaware Guarantors"; Jumpking, UTS, Free Motion and NordicTrack, together,
the "Utah Guarantors"; N.B. Ltd. and ICON Canada, together, the "Canadian
Guarantors"; the Delaware Guarantors, the Utah Guarantors and the Canadian
Guarantors, together, the "Guarantors"). As used herein, the term "Offered
Securities" shall include the Guarantees thereof by the Guarantors, unless the
context otherwise requires.
Holders (including subsequent transferees) of the Offered Securities
will have the registration rights set forth in the registration rights agreement
(the "Registration Rights Agreement"), to be dated the Closing Date, in
substantially the form of Exhibit I hereto, for so long as such Offered
Securities constitute "Transfer Restricted Securities" (as defined in the
Registration Rights Agreement). Pursuant to the Registration Rights Agreement,
the Company and the Guarantors will agree to file with the Securities and
Exchange Commission (the "Commission") under the circumstances set forth
therein, (i) a registration statement under the Securities Act (the "Exchange
Offer Registration Statement") relating to the Company's 11.25% Senior
Subordinated Notes in a like aggregate principal amount as the Offered
Securities originally issued under the Indenture, identical in all material
respects to the Offered Securities and the Guarantees and registered under the
Securities Act (the "Exchange Notes" and the "Exchange Guarantees," together,
the "Exchange Securities") to be offered in exchange for the Offered Securities
(such offer to exchange being referred to as the "Exchange Offer") and the
Guarantees thereof and (ii) a shelf registration statement pursuant to Rule 415
under the Securities Act (the "Shelf Registration Statement" and, together with
the Exchange Offer Registration Statement, the "Registration Statements")
relating to the resale by certain holders of the Offered Securities and to use
its best efforts to cause such Registration Statements to be declared and remain
effective and usable for the periods specified in the Registration Rights
Agreement and to consummate the Exchange Offer. The Offered Securities and the
Exchange Securities are referred to collectively as the "Securities."
2. Representations and Warranties of the Company. The Company and each
of the Guarantors, jointly and severally, represents and warrants to, and agrees
with, the Initial Purchasers that:
(a) A preliminary offering circular and an offering circular
relating to the Offered Securities to be offered by the Company and the
Guarantors have been prepared by the Company and the Guarantors. Such
preliminary offering circular (the "Preliminary Offering Circular") and
offering circular (the "Offering Circular"), as supplemented as of the
date of this Agreement, are hereinafter collectively referred to as the
"Offering Document." On the date of this Agreement, the Offering
Document does not include any untrue statement of a material fact or
omit to state any material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The preceding
sentence does not apply to statements in or omissions from the Offering
Document based upon written information furnished to the Company by any
Initial Purchaser through Credit Suisse First Boston Corporation
("CSFBC") specifically for use therein, it being understood and agreed
that the only such information is that described as such in Section
7(b) hereof.
(b) No order or decree preventing the use of the Offering
Document, or any order asserting that the transactions contemplated by
this Agreement are subject to the
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registration requirements of the Securities Act, has been issued and no
proceeding for that purpose has commenced or is pending or, to the
knowledge of the Company or any of the Guarantors, is contemplated.
(c) The market-related and customer-related data and estimates
included under the captions "Summary" and "Business" in the Offering
Document are based on or derived from sources which the Company and
each of the Guarantors believe to be reliable.
(d) The Offered Securities have been duly and validly
authorized by the Company and when duly executed by the Company in
accordance with the terms of the Indenture and, assuming due
authentication of the Offered Securities by the Trustee, upon delivery
to the Initial Purchasers against payment therefor in accordance with
the terms hereof, will have been validly issued and delivered, and will
constitute valid and legally binding obligations of the Company
entitled to the benefits of the Indenture, enforceable against the
Company in accordance with their terms, subject to the qualification
that the enforceability of the Company's obligations thereunder may be
limited by bankruptcy, fraudulent conveyance, insolvency,
reorganization, moratorium, and other laws relating to or affecting
creditors' rights generally and by general equitable principles
(whether considered in a proceeding in equity or at law). The Offered
Securities will conform to the description thereof in the Offering
Document.
(e) The Exchange Notes have been duly and validly authorized
by the Company and if and when duly issued and authenticated in
accordance with the terms of the Indenture and delivered in accordance
with the Registration Rights Agreement, will constitute valid and
legally binding obligations of the Company entitled to the benefits of
the Indenture, enforceable against the Company in accordance with their
terms, subject to the qualification that the enforceability of the
Company's obligations thereunder may be limited by bankruptcy,
fraudulent conveyance, insolvency, reorganization, moratorium, and
other laws relating to or affecting creditors' rights generally and by
general equitable principles (whether considered in a proceeding in
equity or at law).
(f) The Guarantees have been duly and validly authorized by
the Guarantors and when duly executed and delivered by the Guarantors
in accordance with the terms of the Indenture and upon the due
execution, authentication and delivery of the Offered Securities in
accordance with the Indenture and the issuance of the Offered
Securities in the sale to the Initial Purchasers contemplated by this
Agreement, will constitute valid and legally binding obligations of the
Guarantors, enforceable against the Guarantors in accordance with their
terms, subject to the qualification that the enforceability of the
Guarantors' obligations thereunder may be limited by bankruptcy,
fraudulent conveyance, insolvency, reorganization, moratorium, and
other laws relating to or affecting creditors' rights generally and by
general equitable principles (whether considered in a proceeding in
equity or at law). The Guarantees will conform to the description
thereof in the Offering Document.
(g) The Exchange Guarantees have been duly and validly
authorized by the Guarantors and if and when duly executed and
delivered by the Guarantors in accordance
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with the terms of the Indenture and upon the due execution and
authentication of the Exchange Notes in accordance with the Indenture
and the issuance and delivery of the Exchange Notes contemplated by the
Registration Rights Agreement, will constitute valid and legally
binding obligations of the Guarantors, entitled to the benefits of the
Indenture, enforceable against the Guarantors in accordance with their
terms, subject to the qualification that the enforceability of the
Guarantors' obligations thereunder may be limited by bankruptcy,
fraudulent conveyance, insolvency, reorganization, moratorium, and
other laws relating to or affecting creditors' rights generally and by
general equitable principles (whether considered in a proceeding in
equity or at law).
(h) The Company and each of the Guarantors has been duly
incorporated and is an existing corporation in good standing under the
laws of the state or jurisdiction in which such corporation is
organized, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Offering
Document; and the Company and each of the Guarantors is duly qualified
to do business as a foreign corporation in good standing in all other
jurisdictions in which its ownership or lease of property or the
conduct of its business requires such qualification; except to the
extent that any failure to so qualify would not individually or in the
aggregate have a material adverse effect on the condition (financial or
other), business, properties or results of operations of the Company,
each of the Guarantors and any of their respective subsidiaries, taken
as a whole ("Material Adverse Effect").
(i) Each subsidiary of the Company and the Guarantors has been
duly incorporated and is an existing corporation in good standing under
the laws of the jurisdiction of its incorporation, with power and
authority (corporate and other) to own its properties and conduct its
business as described in the Offering Document; and each subsidiary of
the Company and the Guarantors is duly qualified to do business as a
foreign corporation in good standing in all other jurisdictions in
which its ownership or lease of property or the conduct of its business
requires such qualification, except to the extent that any failure to
so qualify would not individually or in the aggregate have a Material
Adverse Effect; all of the issued and outstanding capital stock of each
subsidiary of the Company and the Guarantors has been duly authorized
and validly issued and is fully paid and nonassessable; and, except as
set forth in the Offering Document, the capital stock of each
subsidiary owned by the Company and the Guarantors, directly or through
subsidiaries, is owned free from liens, encumbrances and defects.
(j) The entities listed on Schedule B hereto are the only
subsidiaries, direct or indirect, of the Company.
(k) The Indenture has been duly and validly authorized by the
Company and the Guarantors, and upon its execution and delivery and,
assuming due authorization, execution and delivery by the Trustee, will
constitute the valid and legally binding agreement of the Company and
the Guarantors, enforceable against the Company and the Guarantors in
accordance with its terms, subject to the qualification that the
enforceability of the Company's and the Guarantors' obligations
thereunder may be limited by bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium,
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and other laws relating to or affecting creditors' rights generally and
by general equitable principles (whether considered in a proceeding in
equity or at law). No qualification of the Indenture under the Trust
Indenture Act of 1939, as amended (the "1939 Act") is required in
connection with the offer and sale of the Offered Securities
contemplated hereby. The Indenture will conform to the description
thereof in the Offering Document.
(l) On the Closing Date, the Indenture will conform in all
material respects to the requirements of the 1939 Act and the rules and
regulations of the Commission applicable to an indenture which is
qualified thereunder.
(m) Except as disclosed in the Offering Document, there are no
contracts, agreements or understandings between the Company or any of
the Guarantors and any person that would give rise to a valid claim
against the Company, any Guarantor or the Initial Purchasers for a
brokerage commission, finder's fee or other like payment in connection
with the Offered Securities.
(n) The Company and each of the Guarantors have all requisite
corporate power and authority to enter into the Registration Rights
Agreement. The Registration Rights Agreement has been duly authorized
by the Company and the Guarantors and, when executed by the Company and
the Guarantors in accordance with the terms hereof and thereof, will be
validly executed and delivered and (assuming the due execution and
delivery thereof by you), will be the valid and legally binding
obligation of the Company and the Guarantors in accordance with the
terms thereof, enforceable against the Company and the Guarantors in
accordance with its terms, except as such enforceability may be limited
by bankruptcy, insolvency, reorganization, moratorium and other similar
laws relating to or affecting creditor's rights generally, by general
equitable principles (regardless of whether such enforceability is
considered in a proceeding in equity or at law), and, as to rights of
indemnification and contribution, by federal or state securities laws
and principles of public policy.
(o) No consent, approval, authorization, or order of, or
filing with, any governmental agency or body or any court is required
for the consummation of the transactions contemplated by this
Agreement, the Indenture or the Registration Rights Agreement in
connection with the issuance and sale of the Offered Securities by the
Company or the Guarantors, except (i) for the order of the Commission
declaring the Exchange Offer Registration Statement or the Shelf
Registration Statement effective, (ii) as may be required under the
1939 Act and (iii) as may be required under the securities or blue sky
laws of certain jurisdictions.
(p) The execution, delivery and performance of the Indenture,
this Agreement and the Registration Rights Agreement, and the issuance
and sale of the Offered Securities and compliance with the terms and
provisions thereof will not result in a breach or violation of any of
the terms and provisions of, or constitute a default under, any
statute, any rule, regulation or order of any governmental agency or
body or any court, domestic or foreign, having jurisdiction over the
Company, any of the Guarantors or any of their respective subsidiaries
or any of their properties, or any material agreement or instrument to
which the Company, any of the Guarantors or any of their respective
subsidiaries is a party or by
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which the Company, any of the Guarantors or any of their respective
subsidiaries is bound or to which any of the properties of the Company,
any of the Guarantors or any of their respective subsidiaries is
subject, or the charter or by-laws of the Company, any of the
Guarantors or any of their respective subsidiaries, and the Company and
each of the Guarantors has full corporate power and authority to
authorize, issue and sell the Offered Securities as contemplated by
this Agreement.
(q) This Agreement has been duly authorized, executed and
delivered by the Company and each of the Guarantors.
(r) Except as disclosed in the Offering Document, the Company,
each of the Guarantors or any of their respective subsidiaries have
good and marketable title to all real properties and all other
properties and assets owned by them, in each case free from liens,
encumbrances and defects that would materially affect the value thereof
or materially interfere with the use made or to be made thereof by
them; and except as disclosed in the Offering Document, the Company,
each of the Guarantors or any of their respective subsidiaries hold any
leased real or personal property under valid and enforceable leases
with no exceptions that would materially interfere with the use made or
to be made thereof by them.
(s) The Company, each of the Guarantors and any of their
respective subsidiaries possess adequate certificates, authorities or
permits issued by appropriate governmental agencies or bodies necessary
to conduct the business now operated by them and have not received any
notice of proceedings relating to the revocation or modification of any
such certificate, authority or permit that, if determined adversely to
the Company, any of the Guarantors or any of their respective
subsidiaries, would individually or in the aggregate have a Material
Adverse Effect.
(t) No labor dispute with the employees of the Company, any of
the Guarantors or any of their respective subsidiaries exists or, to
the knowledge of the Company or any of the Guarantors, is imminent that
might have a Material Adverse Effect.
(u) The Company, each of the Guarantors or any of their
respective subsidiaries own or possess or have the right to use,
adequate trademarks, trade names and other rights to inventions,
know-how, patents, copyrights, licenses, confidential information and
other intellectual property (collectively, "intellectual property
rights") necessary to conduct the business now operated by them, or
presently employed by them, and have not received any notice of
infringement of or conflict with asserted rights of others with respect
to any intellectual property rights that, if determined adversely to
the Company, any of the Guarantors or any of their respective
subsidiaries, would individually or in the aggregate have a Material
Adverse Effect.
(v) Except as disclosed in the Offering Document, neither the
Company, any of the Guarantors nor any of their respective subsidiaries
is in violation of any statute, any rule, regulation, decision or order
of any governmental agency or body or any court, domestic or foreign,
relating to the use, disposal or release of hazardous or toxic
substances or relating to the protection or restoration of the
environment or human exposure to
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hazardous or toxic substances (collectively, "environmental laws"),
owns or operates any real property contaminated with any substance that
is subject to any environmental laws, is liable for any off-site
disposal or contamination pursuant to any environmental laws, or is
subject to any claim relating to any environmental laws, which
violation, contamination, liability or claim would individually or in
the aggregate have a Material Adverse Effect; and neither the Company
nor any of the Guarantors is aware of any pending investigation which
might lead to such a claim.
(w) Except as disclosed in the Offering Document, there are no
pending actions, suits or proceedings against or, to the Company's
knowledge, affecting the Company, any of the Guarantors, any of their
respective subsidiaries or any of their respective properties that, if
determined adversely to the Company, any of the Guarantors or any of
their respective subsidiaries, would individually or in the aggregate
have a Material Adverse Effect, or would materially and adversely
affect the ability of the Company or any of the Guarantors to perform
their respective obligations under the Indenture, this Agreement or the
Registration Rights Agreement, or which are otherwise material in the
context of the sale of the Offered Securities; and to the Company's or
any of the Guarantor's knowledge no such actions, suits or proceedings
are threatened or contemplated.
(x) The financial statements included in the Offering Document
present fairly the financial position of the Company and its
consolidated subsidiaries as of the dates shown and their results of
operations and cash flows for the periods shown, and such financial
statements have been prepared in conformity with the generally accepted
accounting principles in the United States applied on a consistent
basis; and the assumptions used in preparing the pro forma financial
statements included in the Offering Document provide a reasonable basis
for presenting the significant effects directly attributable to the
transactions or events described therein, the related pro forma
adjustments give appropriate effect to those assumptions, and the pro
forma columns therein reflect the proper application of those
adjustments to the corresponding historical financial statement
amounts.
(y) Except as disclosed in the Offering Document, since the
date of the latest audited financial statements included in the
Offering Document, neither the Company, any Guarantor nor any of their
respective subsidiaries has sustained any material loss or interference
with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court
or governmental action, order or decree and there has been no material
adverse change, nor any development or event involving a prospective
material adverse change, in the condition (financial or other),
business, properties or results of operations of the Company, any of
the Guarantors or any of their respective subsidiaries, and, except as
disclosed in or contemplated by the Offering Document, there has been
no dividend or distribution of any kind declared, paid or made by the
Company or any of the Guarantors on any class of its capital stock.
(z) The Company is not an open-end investment company, unit
investment trust or face-amount certificate company that is or is
required to be registered under Section 8 of the United States
Investment Company Act of 1940, as amended and the rules and
regulations of the Commission thereunder (the "Investment Company
Act"); and the
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Company is not and, after giving effect to the offering and sale of the
Offered Securities and the application of the proceeds thereof as
described in the Offering Document, will not be an "investment company"
as defined in the Investment Company Act.
(aa) No securities of the same class (within the meaning of
Rule 144A(d)(3) under the Securities Act) as the Offered Securities are
listed on any national securities exchange registered under Section 6
of the United States Securities Exchange Act of 1934 (the "Exchange
Act") or quoted in a U.S. automated inter-dealer quotation system.
(bb) The offer and sale of the Offered Securities by the
Company to the Initial Purchasers in the manner contemplated by this
Agreement will be exempt from the registration requirements of the
Securities Act by reason of Section 4(2) thereof and Regulation S
thereunder ("Regulation S"); and it is not necessary to qualify an
indenture in respect of the Offered Securities under the Trust
Indenture Act.
(cc) Neither the Company, any of the Guarantors nor any of
their respective affiliates, nor any person acting on its or their
behalf (i) has, within the six-month period immediately prior to the
date hereof, offered or sold in the United States or to any U.S. person
(as such terms are defined in Regulation S) the Offered Securities or
any security of the same class or series as the Offered Securities or
(ii) has offered or will offer or sell the Offered Securities (A) in
the United States by means of any form of general solicitation or
general advertising within the meaning of Rule 502(c) under the
Securities Act or (B) with respect to any securities sold in reliance
on Rule 903 of Regulation S, by means of any directed selling efforts
within the meaning of Rule 902(c) of Regulation S. The Company, each of
the Guarantors and any of their respective affiliates and any person
acting on its or their behalf have complied and will comply with the
offering restrictions requirement of Regulation S. The Company and each
of the Guarantors has not entered and will not enter into any
contractual arrangement with respect to the distribution of the Offered
Securities except for this Agreement.
(dd) The Offering Document contains all the information
specified in, and meeting the requirements of, Rule 144A(d)(4) under
the Securities Act.
(ee) There are no contracts, agreements or understandings
between the Company or any Guarantor and any person (other than the
Registration Rights Agreement and the registration rights agreement
entered into by the Company in connection with the issuance of the
Company's 12% Senior Subordinated Notes due 2005) granting such person
the right to require the Company or such Guarantor to file a
registration statement under the Securities Act with respect to any
securities of the Company or such Guarantor owned or to be owned by
such person or to require the Company or such Guarantor to include such
securities with the Offered Securities and Guarantees registered
pursuant to the Registration Rights Agreement or with any securities
being registered pursuant to any other registration statement filed by
the Company or any Guarantor under the Securities Act.
(ff) The Company, each of the Guarantors and each of their
respective subsidiaries carry, or are covered by, insurance in such
amounts and covering such risks
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as is adequate for the conduct of their respective businesses and the
value of their respective properties and as is customary for companies
engaged in similar businesses in similar industries.
(gg) No relationship, direct or indirect, required to be
described under Item 404 of Regulation S-K, exists between or among the
Company on the one hand, and the directors, officers or stockholders of
the Company on the other hand, which is not described in the Offering
Document.
(hh) The Company is in compliance in all material respects
with all presently applicable provisions of ERISA; no "reportable
event" (as defined in ERISA), has occurred with respect to any "pension
plan" (as defined in ERISA), for which the Company would have any
liability; the Company has not incurred and does not expect to incur
liability under (i) Title IV of ERISA with respect to termination of,
or withdrawal from, any "pension plan" or (ii) Sections 412 or 4971 of
the Internal Revenue Code of 1986, as amended, including the
regulations and published interpretations thereunder (the "Code"); and
each "pension plan" for which the Company would have any liability that
is intended to be qualified under Section 401(a) of the Code is so
qualified in all material respects and nothing has occurred, whether by
action or by failure to act, which would cause the loss of such
qualification.
(ii) The Company and each of the Guarantors have filed all
federal, state and local income and franchise tax returns required to
be filed through the date hereof and have paid all taxes due thereon,
and no tax deficiency has been determined adversely to the Company, any
of the Guarantors or any of their respective subsidiaries which has had
(nor does the Company or any of the Guarantors have any knowledge of
any tax deficiency which, if determined adversely to the Company, any
of the Guarantors or any of their respective subsidiaries, might have)
a Material Adverse Effect.
(jj) Since the date as of which information is given in the
Preliminary Offering Circular through the date hereof, and except as
may otherwise be disclosed or contemplated in the Offering Document,
neither the Company nor any of the Guarantors have (i) issued or
granted any securities, (ii) incurred any liability or obligation,
direct or contingent, other than liabilities and obligations which were
incurred in the ordinary course of business, (iii) entered into any
transaction not in the ordinary course of business or (iv) declared or
paid any dividend on its capital stock.
(kk) The Company and each of the Guarantors (i) make and keep
books and records which are accurate in all material respects and (ii)
maintain internal accounting controls which provide reasonable
assurance that (A) transactions are executed in accordance with
management's authorization, (B) transactions are recorded as necessary
to permit preparation of its financial statements and to maintain
accountability for its assets, (C) access to their respective assets is
permitted only in accordance with management's authorization and (D)
the reported accountability for their respective assets is compared
with existing assets at reasonable intervals.
(ll) Neither the Company, the Guarantors nor any of their
respective subsidiaries (i) is in violation of its respective charter
or by-laws (ii) is in default in any material
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respect, and no event has occurred which, with notice or lapse of time
or both would constitute such a material default, in the due
performance or observance of any obligation, agreement, covenant or
condition contained in any material indenture, loan agreement,
mortgage, deed of trust, lease or other agreement or instrument to
which it is a party or by which it is bound or to which any of its
properties or assets is subject or (iii) is in violation in any
material respect of any law, ordinance, governmental rule, regulation
or court decree to which it or its property or assets may be subject or
has failed to obtain any material license, permit, certificate,
franchise or other governmental authorization or permit necessary to
the ownership of its property or to the conduct of its business.
(mm) Neither the Company nor any of the Guarantors nor any of
their respective subsidiaries, nor, to the Company's or any Guarantor's
knowledge, any director, officer, agent, employee or other person
associated with or acting on behalf of the Company, any of the
Guarantors or any of their respective subsidiaries, has used any
corporate funds for any unlawful contribution, gift, entertainment or
other unlawful expense relating to political activity; made any direct
or indirect unlawful payment to any foreign or domestic government
official or employee from corporate funds; violated or is in violation
of any provision of the Foreign Corrupt Practices Act of 1977; or made
any bribe, rebate, payoff, influence payment, kickback or other
unlawful payment.
(nn) None of the transactions contemplated by this Agreement
(including, without limitation, the use of the proceeds from the sale
of the Offering Securities), will violate or result in a violation of
Section 7 of the Exchange Act, or any regulation promulgated
thereunder, including, without limitation, Regulations T, U, and X of
the Board of Governors of the Federal Reserve System.
(oo) No "nationally recognized statistical rating
organization" as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act (i) has imposed (or has informed the Company
or any Guarantor that it is considering imposing) any condition
(financial or otherwise) on the Company's or any Guarantor's retaining
any rating assigned to the Company or any Guarantor, any securities of
the Company or any Guarantor or (ii) has indicated to the Company or
any Guarantor that it is considering (a) the downgrading, suspension,
or withdrawal of, or any review for a possible change that does not
indicate the direction of the possible change in, any rating so
assigned or (b) any unfavorable change in the outlook for any rating of
the Company, any Guarantor or any securities of the Company or any
Guarantor.
(pp) No form of general solicitation or general advertising
(as defined in Regulation D under the Securities Act) was used by the
Company, the Guarantors or any of their respective representatives
(other than the Initial Purchasers, as to whom the Company and the
Guarantors make no representation) in connection with the offer and
sale of the Offered Securities contemplated hereby, including, but not
limited to, articles, notices or other communications published in any
newspaper, magazine, or similar medium or broadcast over television or
radio, or any seminar or meeting whose attendees have been invited by
any general solicitation or general advertising.
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(qq) The Offered Securities offered and sold in reliance on
Regulation S have been and will be offered and sold only in offshore
transactions.
(rr) None of the Company, the Guarantors nor any of their
respective affiliates or any person acting on its or their behalf
(other than the Initial Purchasers, as to whom the Company and the
Guarantors make no representation) has engaged or will engage in any
directed selling efforts within the meaning of Regulation S with
respect to the Offered Securities or the Subsidiary Guarantees.
(ss) The sale of the Offered Securities pursuant to Regulation
S is not part of a plan or scheme to evade the registration provisions
of the Securities Act.
(tt) The Credit Agreement (as defined in the Indenture) has
been duly and validly authorized by the Company and the Guarantors, and
upon its execution and delivery and, assuming due authorization,
execution and delivery by the lenders party thereto, will constitute
the valid and legally binding agreement of the Company and the
Guarantors, enforceable against the Company and the Guarantors in
accordance with its terms, subject to the qualification that the
enforceability of the Company's and the Guarantors' obligations
thereunder may be limited by bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium, and other laws relating to or
affecting creditors' rights generally and by general equitable
principles (whether considered in a proceeding in equity or at law).
3. Purchase, Sale and Delivery of Offered Securities. On the basis of
the representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, the Company agrees to sell to the
Initial Purchasers and the Initial Purchasers agree, severally and not jointly,
to purchase from the Company, at a purchase price of 95.964% of the principal
amount thereof plus accrued interest from April 9, 2002 to the Closing Date (as
hereinafter defined), the respective principal amounts of Securities set forth
opposite the names of the several Initial Purchasers in Schedule A hereto.
The Company will deliver against payment of the purchase price the
Offered Securities to be offered and sold by the Initial Purchasers in reliance
on Regulation S (the "Regulation S Securities") in the form of one or more
temporary global Securities in registered form without interest coupons (the
"Regulation S Temporary Global Securities") which will be deposited with the
Trustee as custodian for The Depository Trust Company ("DTC") for the respective
accounts of the DTC participants for Xxxxxx Guaranty Trust Company of New York,
Brussels office, as operator of the Euroclear System ("Euroclear"), and
Clearstream Banking, societe anonyme ("Clearstream, Luxembourg") and registered
in the name of Cede & Co., as nominee for DTC. The Company will deliver against
payment of the purchase price the Offered Securities to be purchased by the
Initial Purchasers hereunder and to be offered and sold by the Initial
Purchasers in reliance on Rule 144A under the Securities Act (the "144A
Securities") in the form of one permanent global security in definitive form
without interest coupons (the "Restricted Global Securities") deposited with the
Trustee as custodian for DTC and registered in the name of Cede & Co., as
nominee for DTC. The Regulation S Temporary Global Securities and the Restricted
Global Securities shall be assigned separate CUSIP numbers. The Restricted
Global Securities shall include the legend regarding restrictions on transfer
set forth under "Transfer Restrictions" in the Offering
11
Document. Until the termination of the restricted period (as defined in
Regulation S) with respect to the offering of the Offered Securities, interests
in the Regulation S Temporary Global Securities may only be held by the DTC
participants for Euroclear and Clearstream, Luxembourg and may not be held in
definitive form. Interests in any permanent global Securities will be held only
in book-entry form through Euroclear, Clearstream, Luxembourg or DTC, as the
case may be, except in the limited circumstances described in the Offering
Document.
Payment for the Regulation S Securities and the 144A Securities shall
be made by the Initial Purchasers in Federal (same day) funds by wire transfer
to an account at a bank acceptable to CSFBC drawn to the order of ICON Health &
Fitness, Inc. at a closing to be conducted at the office of Xxxxxx & Xxxxxxx,
000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 at 10:00 A.M., (New York time), on
April 9, 2002, or at such other time not later than seven full business days
thereafter as CSFBC and the Company determine, such time being herein referred
to as the "Closing Date," against delivery to the Trustee as custodian for DTC
of (i) the Regulation S Temporary Global Securities representing all of the
Regulation S Securities for the respective accounts of the DTC participants for
Euroclear and Clearstream, Luxembourg and (ii) the Restricted Global Securities
representing all of the 144A Securities. The Regulation S Temporary Global
Securities and the Restricted Global Securities will be made available for
checking at the above office of Xxxxxx & Xxxxxxx at least 24 hours prior to the
Closing Date.
4. Representations by Initial Purchasers; Resale by Initial Purchasers.
(a) Each Initial Purchaser severally represents and warrants to the
Company and each of the Guarantors that it is an "accredited investor" within
the meaning of Regulation D under the Securities Act.
(b) Each Initial Purchaser severally acknowledges that the Offered
Securities have not been registered under the Securities Act and may not be
offered or sold within the United States or to, or for the account or benefit
of, U.S. persons except in accordance with Regulation S or pursuant to an
exemption from the registration requirements of the Securities Act. Each Initial
Purchaser severally represents and agrees that it has offered and sold the
Offered Securities and will offer and sell the Offered Securities (i) as part of
its distribution at any time and (ii) otherwise until 40 days after the later of
the commencement of the offering and the Closing Date, only in accordance with
Rule 903 or Rule 144A under the Securities Act ("Rule 144A"). Accordingly,
neither such Initial Purchaser nor its affiliates, nor any persons acting on its
or their behalf, have engaged or will engage in any directed selling efforts
with respect to the Offered Securities, and such Initial Purchaser, its
affiliates and all persons acting on its or their behalf have complied and will
comply with the offering restrictions requirement of Regulation S. Each Initial
Purchaser severally agrees that, at or prior to confirmation of sale of the
Offered Securities, other than a sale pursuant to Rule 144A, such Initial
Purchaser will have sent to each distributor, dealer or person receiving a
selling concession, fee or other remuneration that purchases the Offered
Securities from it during the restricted period a confirmation or notice to
substantially the following effect:
"The Securities covered hereby have not been registered under
the U.S. Securities Act of 1933 (the "Securities Act") and may
not be offered or sold within the United States or to, or for
the account or benefit of, U.S. persons (i) as part of their
distribution at any time or (ii) otherwise until 40
12
days after the later of the date of the commencement of the
offering and the closing date, except in either case in
accordance with Regulation S (or Rule 144A if available) under
the Securities Act. Terms used above have the meanings given
to them by Regulation S."
Terms used in this subsection (b) have the meanings given to them by
Regulation S.
(c) Each Initial Purchaser severally agrees that it and each of its
affiliates has not entered and will not enter into any contractual arrangement
with respect to the distribution of the Offered Securities except with the prior
written consent of the Company.
(d) Each Initial Purchaser severally agrees that it and each of its
affiliates will not offer or sell the Offered Securities in the United States by
means of any form of general solicitation or general advertising, within the
meaning of Rule 502(c) under the Securities Act, including, but not limited to
(i) any advertisement, article, notice or other communication published in any
newspaper, magazine or similar media or broadcast over television or radio, or
(ii) any seminar or meeting whose attendees have been invited by any general
solicitation or general advertising. Each Initial Purchaser severally agrees,
with respect to initial resales made in reliance on Rule 144A of any of the
Offered Securities, to deliver either with the confirmation of such resale or
otherwise prior to settlement of such resale a notice to the effect that the
resale of such Offered Securities has been made in reliance upon the exemption
from the registration requirements of the Securities Act provided by Rule 144A.
(e) Each Initial Purchaser severally represents and agrees that (i) it
has not authorized the notes to be offered to the public in the United Kingdom,
within the meaning of the Public Offers of Securities Regulations 1995, as
amended, and (ii) no Offering Document may be passed on to any person in the
United Kingdom unless that person is of a kind described in Article 19 of the
Financial Services and Markets Xxx 0000 (Financial Promotion) Order 2001 or is a
person to whom the document may otherwise lawfully be issued or passed on. The
Offering Document is only directed at persons having professional experience in
matters relating to investments and the offering described in the Offering
Document is only available to such persons and only such persons will be
permitted to participate in the offering. Persons who do not have professional
experience in matters relating to investments should not rely on the Offering
Document. All applicable provisions of the Financial Services and Markets Xxx
0000, as amended, must be complied with in respect of anything done in relation
to the notes in, from or otherwise involving the United Kingdom.
5. Certain Agreements of the Company. The Company and each of the
Guarantors, jointly and severally, agree with the Initial Purchasers that:
(a) During such period as, in the opinion of Xxxxxx & Xxxxxxx,
an Offering Document is required by law to be delivered in connection
with Exempt Resales by the Initial Purchasers and in connection with
market-making activities of the Initial Purchasers for so long as any
Offered Securities are outstanding, the Company and each of the
Guarantors will advise CSFBC promptly of any proposal to amend or
supplement the Offering Document and will not effect such amendment or
supplementation without CSFBC's consent (which consent shall not be
unreasonably withheld). If, at any time
13
prior to the completion of the resale of the Offered Securities by the
Initial Purchasers any event occurs as a result of which the Offering
Document as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it is
necessary at any such time to amend or supplement the Offering Document
to comply with any applicable law, the Company and each of the
Guarantors promptly will notify CSFBC of such event and promptly will
prepare, at its own expense, an amendment or supplement which will
correct such statement or omission or effect such compliance. Neither
CSFBC's consent to, nor the Initial Purchasers' delivery to offerees or
investors of, any such amendment or supplement shall constitute a
waiver of any of the conditions set forth in Section 6.
(b) The Company will furnish to CSFBC copies of the Offering
Document and all amendments and supplements to such documents, in each
case as soon as available and in such quantities as CSFBC requests.
Subject to the Initial Purchasers' compliance with its representations
and warranties and agreements set forth in Section 4 hereof, the
Company and the Guarantors consent to the use of the Offering Document,
and any amendments and supplements thereto required pursuant hereto, by
the Initial Purchasers in connection with Exempt Resales. At any time
when the Company is not subject to Section 13 or 15(d) of the Exchange
Act, the Company will promptly furnish or cause to be furnished to
CSFBC (and, upon request, to each of the other Initial Purchasers) and,
upon request of holders and prospective purchasers of the Offered
Securities, to such holders and purchasers, copies of the information
required to be delivered to holders and prospective purchasers of the
Offered Securities pursuant to Rule 144A(d)(4) under the Securities Act
(or any successor provision thereto) in order to permit compliance with
Rule 144A in connection with resales by such holders of the Offered
Securities. The Company will pay the expenses of printing and
distributing to the Initial Purchasers all such documents.
(c) The Company and each of the Guarantors will use its best
efforts to arrange for the qualification of the Offered Securities for
sale and the determination of their eligibility for investment under
the laws of such jurisdictions in the United States as CSFBC reasonably
designates and will continue such qualifications in effect so long as
required for the resale of the Offered Securities by the Initial
Purchasers provided that neither the Company nor any of the Guarantors
will be required to qualify as a foreign corporation or otherwise
subject itself to taxation in any state in which it is not otherwise so
qualified or subject, nor shall any of them be required to file a
general consent to service of process in any such state.
(d) During the period of ten years hereafter (or until the
date of payment in full of the Offered Securities, if earlier), the
Company and each of the Guarantors will furnish to CSFBC and, upon
request, to each of the other Initial Purchasers as soon as practicable
after the end of each fiscal year, a copy of its annual report to
stockholders for such year; and the Company and each of the Guarantors
will furnish to CSFBC and, upon request, to each of the other Initial
Purchasers (i) as soon as available, a copy of each report and any
definitive proxy statement of the Company and the Guarantors mailed to
14
stockholders and (ii) from time to time, such other information
concerning the Company or any of the Guarantors as CSFBC may reasonably
request.
(e) During the period of two years after the Closing Date, the
Company will, upon request, furnish to CSFBC, each of the other Initial
Purchasers and any holder of Offered Securities a copy of the
restrictions on transfer applicable to the Offered Securities.
(f) During the period of two years after the Closing Date, the
Company and each of the Guarantors will not, and will not permit any of
its affiliates (as defined in Rule 144 under the Securities Act) to,
resell any of the Offered Securities that have been reacquired by any
of them.
(g) During the period of two years after the Closing Date, the
Company and each of the Guarantors will not be or become, an open-end
investment company, unit investment trust or face-amount certificate
company that is or is required to be registered under Section 8 of the
Investment Company Act.
(h) The Company and each of the Guarantors, jointly and
severally, agree to pay all expenses incidental to the performance of
their obligations under this Agreement, the Indenture and the
Registration Rights Agreement including (i) the fees and expenses of
the Trustee and its professional advisors; (ii) all expenses in
connection with the execution, issue, authentication, packaging and
initial delivery of the Offered Securities and, as applicable, the
Exchange Securities, the preparation and printing of this Agreement,
the Registration Rights Agreement, the Offered Securities, the
Indenture, the Offering Document and amendments and supplements
thereto, and any other document relating to the issuance, offer, sale
and delivery of the Offered Securities and as applicable the Exchange
Securities; (iii) the cost of qualifying the Offered Securities for
trading in The PortalSM Market ("PORTAL") of The Nasdaq National Market
Inc. and any expenses incidental thereto, (iv) the cost of any
advertising approved by the Company in connection with the issue of the
Offered Securities; (v) for any expenses (including fees and
disbursements of counsel) incurred in connection with qualification of
the Offered Securities or the Exchange Securities for sale under the
laws of such jurisdictions in the United States as CSFBC designates and
the printing of memoranda relating thereto; (vi) for any fees charged
by investment rating agencies for the rating of the Securities or the
Exchange Securities; and (vii) for expenses incurred in distributing
the Offering Document (including any amendments and supplements
thereto) to the Initial Purchasers. The Company and each of the
Guarantors will also pay or reimburse the Initial Purchasers for all
travel expenses of the Initial Purchasers (to the extent incurred by
them) and the Company's officers and employees and any other expenses
of the Initial Purchasers and the Company in connection with attending
or hosting meetings with prospective purchasers of the Offered
Securities
(i) In connection with the offering, until CSFBC shall have
notified the Company and the other Initial Purchasers of the completion
of the resale of the Offered Securities, neither the Company nor any of
its affiliates has or will, either alone or with one or more other
persons, bid for or purchase for any account in which it or any of its
affiliates has a beneficial interest any Offered Securities or attempt
to induce any person to purchase any
15
Offered Securities; and neither it nor any of its affiliates will make
bids or purchases for the purpose of creating actual, or apparent,
active trading in, or of raising the price of, the Offered Securities.
(j) For a period of 180 days after the date of the initial
offering of the Offered Securities by the Initial Purchasers, the
Company and each of the Guarantors, without the prior written consent
of CSFBC, will not offer, sell, contract to sell, pledge, or otherwise
dispose of, directly or indirectly, any United States
dollar-denominated debt securities issued or guaranteed by the Company
or any Guarantor and having a maturity of more than one year from the
date of issue. Neither the Company nor any Guarantor will at any time
offer, sell, contract to sell, pledge or otherwise dispose of, directly
or indirectly, any securities under circumstances where such offer,
sale, pledge, contract or disposition would cause the exemption
afforded by Section 4(2) of the Securities Act or the safe harbor of
Regulation S thereunder to cease to be applicable to the offer and sale
of the Offered Securities.
(k) The Company and each of the Guarantors will apply the net
proceeds from the sale of the Offered Securities to be sold by it
hereunder substantially in accordance with the description set forth in
the Offering Document under the caption "Use of Proceeds."
(l) Except as stated in this Agreement and in the Offering
Document, neither the Company, any of the Guarantors nor any of their
respective affiliates have taken, nor will any of them take, directly
or indirectly, any action designed to or that might reasonably be
expected to cause or result in stabilization or manipulation of the
price of any security of the Company or any of the Guarantors to
facilitate the sale or resale of the Offered Securities. Except as
permitted by the Securities Act, the Company and each of the Guarantors
will not distribute any offering material in connection with resales of
the Offered Securities.
(m) The Company and each of the Guarantors will use their best
efforts to permit the Offered Securities to be designated PORTAL
securities in accordance with the rules and regulations adopted by the
National Association of Securities Dealers, Inc. relating to trading in
PORTAL and to permit the Offered Securities to be eligible for
clearance and settlement through DTC.
(n) The Company and the Guarantors have complied and will
comply with all provisions of Florida Statutes Section 517.075 relating
to issuers doing business with Cuba.
(o) The Company and the Guarantors agree not to sell, offer
for sale or solicit offers to buy or otherwise negotiate in respect of
any security (as defined in the Securities Act), that would be
integrated with the sale of the Offered Securities in a manner that
would require the registration under the Securities Act of the sale to
the Initial Purchasers or the resale of the Offered Securities.
16
(p) The Company and each of the Guarantors agree to comply
with all the terms and conditions of the Registration Rights Agreement
and all agreements set forth in the representation letters of the
Company and each of the Guarantors to DTC relating to the approval of
the Offered Securities by DTC for "book entry" transfer.
(q) The Company and each of the Guarantors agree that prior to
any registration of the Offered Securities pursuant to the Registration
Rights Agreement, or at such earlier time as may be required, the
Indenture shall be qualified under the 1939 Act and any necessary
supplemental indentures will be entered into in connection therewith.
(r) The Company and each of the Guarantors will not
voluntarily claim, and will resist actively all attempts to claim, the
benefit of any usury laws against holders of the Offered Securities.
(s) For so long as any of the Offered Securities are
outstanding and if, in the reasonable judgment of the Initial
Purchasers or Xxxxxx & Xxxxxxx, the Initial Purchasers or any of their
affiliates (as defined in the rules and regulations under the
Securities Act) are required to deliver a prospectus (any such
prospectus, a "Market Making Prospectus") in connection with sales of
the Offered Securities, to (i) provide the Initial Purchasers and their
affiliates, without charge, as many copies of the Market Making
Prospectus as they may reasonably request, (ii) periodically amend the
Offering Document and the Exchange Offer Registration Statement so that
the information contained therein complies with the requirements of
Section 10(a) of the Securities Act, (iii) amend the Exchange Offer
Registration Statement or amend or supplement the Market Making
Prospectus when necessary to reflect any material changes in the
information provided therein and promptly file such amendment or
supplement with the Commission, (iv) provide the Initial Purchasers and
their affiliates with copies of each amendment or supplement so filed
and such other documents, including opinions of counsel and "comfort"
letters, as they may reasonably request and (v) indemnify the Initial
Purchasers and their affiliates with respect to the Market Making
Prospectus and, if applicable, contribute to any amount paid or payable
by the Initial Purchasers and their affiliates in a manner
substantially identical to that specified in Section 7 hereof (with
appropriate modifications). The Company and each of the Guarantors
consent to the use, subject to the provisions of the Securities Act and
the state securities or Blue Sky laws of the jurisdictions in which the
Offered Securities are offered by the Initial Purchasers, of each
Market Making Prospectus.
(t) The Company and each of the Guarantors will do and perform
all things required or necessary to be done and performed under this
Agreement by them prior to the Closing Date, and to satisfy all
conditions precedent to the Initial Purchasers' obligations hereunder
to purchase the Offered Securities.
6. Conditions of the Obligations of the Initial Purchasers. The
obligations of the several Initial Purchasers to purchase and pay for the
Offered Securities on the Closing Date will be subject to the accuracy of the
representations and warranties on the part of the Company and each of the
Guarantors herein, to the accuracy of the statements of officers of the Company
and each of the Guarantors made pursuant to the provisions hereof, to the
performance by the Company and each of
17
the Guarantors of their respective obligations hereunder and to the following
additional conditions precedent:
(a) The Initial Purchasers shall have received a letter, dated
the date of this Agreement, of PricewaterhouseCoopers LLP in form and
substance satisfactory to the Initial Purchasers concerning the
financial information set forth in the Offering Document.
(b) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) a change in U.S. or
international financial, political or economic conditions or currency
exchange rates or exchange controls as would, in the judgment of CSFBC,
be likely to prejudice materially the success of the proposed issue,
sale or distribution of the Offered Securities, whether in the primary
market or in respect of dealings in the secondary market, or (ii) (A)
any change, or any development or event involving a prospective change,
in the condition (financial or other), business, properties or results
of operations of the Company, any of the Guarantors and their
respective subsidiaries which, in the judgment of a majority in
interest of the Initial Purchasers including CSFBC, is so material and
adverse as to make it impractical or inadvisable to proceed with
completion of the offering or the sale of and payment for the Offered
Securities; (B) any downgrading in the rating of any debt securities of
the Company by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the
Securities Act), or any public announcement that any such organization
has under surveillance or review its rating of any debt securities of
the Company (other than an announcement with positive implications of a
possible upgrading, and no implication of a possible downgrading, of
such rating) or any announcement that the Company has been placed on
negative outlook; (C) any material suspension or material limitation of
trading in securities generally on the New York Stock Exchange or any
setting of minimum prices for trading on such exchange, or any
suspension of trading of any securities of the Company on any exchange
or in the over-the-counter market; (D) any banking moratorium declared
by U.S. Federal or New York authorities; (E) any major disruption of
settlements of securities; or (F) any attack on, any outbreak or
escalation of hostilities or acts of terrorism involving the United
States, any declaration of war by Congress or any other national or
international calamity or emergency if, in the judgment of a majority
in interest of the Purchasers including CSFBC, the effect of any such
attack, outbreak, escalation, act, declaration, calamity or emergency
makes it impractical or inadvisable to proceed with completion of the
offering or the sale of and payment for the Offered Securities.
(c) The Initial Purchasers shall have received an opinion,
dated the Closing Date, of Xxxxxxxx, Xxxxxxx & Xxxxxxx, a Professional
Corporation counsel for the Company, in form and substance satisfactory
to the Initial Purchasers, to the effect that:
(i) The Company and each of the Delaware Guarantors is a
validly existing corporation in good standing under the laws
of the jurisdiction of its incorporation, with corporate power
and authority to own its properties and conduct its business
as described in the Offering Document; and, based solely on
certificates of public officials, the Company and each of the
Delaware Guarantors are duly qualified to do business as a
foreign corporation in good standing in all other
jurisdictions
18
identified by the Company (x) in which its ownership or lease
of property or the conduct of its business requires such
qualification, and (y) where the failure to so qualify could
reasonably be anticipated to result in a Material Adverse
Effect.
(ii) The Offered Securities have been duly authorized,
executed, authenticated and delivered by the Company and
conform in all material respects to the description thereof
contained in the Offering Document.
(iii) The Indenture has been duly authorized, executed
and delivered by the Company and each of the Delaware
Guarantors.
(iv) The Indenture conforms in all material respects to
the requirements of the Trust Indenture Act, and the rules and
regulations of the Commission applicable to an indenture which
is qualified thereunder.
(v) The Exchange Notes have been duly authorized by the
Company.
(vi) The Guarantee to be endorsed on the Offered
Securities by each of the Delaware Guarantors has been duly
authorized by each such Delaware Guarantor, and has been duly
executed and delivered by each such Delaware Guarantor and
conforms to the description thereof contained in the Offering
Document.
(vii) The Exchange Guarantee to be endorsed on the
Exchange Notes by each Delaware Guarantor has been duly
authorized by each such Delaware Guarantor.
(viii) The Company is not and, after giving effect to the
offering and sale of the Offered Securities and the
application of the proceeds thereof as described in the
Offering Circular, will not be an "investment company" as
defined in the Investment Company Act of 1940.
(ix) No consent, approval, authorization or order of, or
filing with, any governmental agency or body or any court is
required to be obtained or made by the Company or any Delaware
Guarantor for the consummation of the transactions
contemplated by this Agreement or the Registration Rights
Agreement in connection with the issuance or sale of the
Offered Securities by the Company or any Delaware Guarantor,
except such as may be required under state securities laws and
except for the order of the Commission declaring the Exchange
Offer Registration Statement or the Shelf Registration
Statement effective.
(x) The execution, delivery and performance of the
Indenture, this Agreement and the Registration Rights
Agreement and the issuance and sale of the Offered Securities
and compliance with the terms and provisions thereof will not
result in a breach or violation of any of the terms and
provisions of, or constitute a default under, any statute,
rule, regulation or, to such counsel's knowledge, order of any
governmental agency or body or any court having jurisdiction
over the Company
19
or any of the Delaware Guarantors or any of their respective
properties, or any agreement identified to such counsel by the
Company as material and listed on a Schedule attached to such
counsel's opinion to which the Company or any of the Delaware
Guarantors is a party or by which the Company or any of the
Delaware Guarantors is bound or to which any of the properties
of the Company or any of the Delaware Guarantors is subject,
or the charter or by-laws of the Company or any of the
Delaware Guarantors, and the Company and each of the Delaware
Guarantors has full corporate power and authority to
authorize, issue and sell the Offered Securities as
contemplated by this Agreement.
(xi) Such counsel have no reason to believe that the
Offering Circular, or any amendment or supplement thereto, as
of the date hereof and as of the Closing Date, contained any
untrue statement of a material fact or omitted to state any
material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not
misleading; it being understood that such counsel need express
no opinion as to the financial statements or other financial
or accounting information contained in the Offering Circular.
(xii) This Agreement and the Registration Rights
Agreement have each been duly authorized, executed and
delivered by the Company and each of the Delaware Guarantors.
(xiii) When the Offered Securities are issued and
delivered pursuant to this Agreement, such Offered Securities
will not be of the same class (within the meaning of Rule 144A
under the Securities Act), as any securities of the Company or
any Guarantor that are listed on a national securities
exchange registered under Section 6 of the Exchange Act or
that are quoted in a United States automated inter-dealer
quotation system.
(xiv) The Offering Document complied with the
requirements of Rule 144A of the Securities Act (except for
the financial statements and the notes thereto and schedules
included therein, as to which no opinion need be expressed).
(xv) There are no preemptive or other rights to
subscribe for or to purchase, nor any restriction upon the
voting or transfer of, any securities pursuant to the
Company's charter or by-laws or any agreement or other
instrument known to such counsel.
(xvi) It is not necessary in connection with (i) the
offer, sale and delivery of the Offered Securities by the
Company and each of the Guarantors to the Initial Purchasers
pursuant to this Agreement or (ii) the initial resales of the
Offered Securities by the Initial Purchasers in the manner
contemplated by this Agreement to register the Offered
Securities under the Securities Act or to qualify an indenture
in respect thereof under the Trust Indenture Act.
(xvii) The statements contained in the Offering Document
under the caption "Description of the Notes" in so far as they
purport to constitute a summary of
20
the terms of the Offered Securities and under the captions
"Certain Relationships and Related Party Transactions,"
"Certain United States Federal Income Tax Considerations" and
"Plan of Distribution," insofar as they describe the laws and
documents referred therein, are accurate in all material
respects.
(xiii) The Credit Agreement has been duly authorized,
executed and delivered by the Company and each of the
Guarantors; and the Credit Agreement constitutes a valid and
legally binding obligation of the Company and each of the
Guarantors enforceable against the Company and each of the
Guarantors in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating
to or affecting creditors' rights and to general equity
principles (whether considered in a proceeding in equity or at
law), or an implied covenant of good faith and fair dealing
and except with respect to the rights of indemnification and
contribution thereunder, where enforcement thereof may be
limited by state or federal securities laws or the policies
underlying such laws.
(d) The Initial Purchasers shall have received an opinion,
dated the Closing Date, of Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx LLP, New York
counsel for the Company, that:
(i) The Offered Securities constitute valid and legally
binding obligations of the Company entitled to the benefits of
the Indenture, enforceable against the Company in accordance
with their terms, subject to the qualification that the
enforceability of the Company's obligations thereunder may be
limited by bankruptcy, fraudulent conveyance, insolvency,
reorganization, moratorium, and other laws relating to or
affecting creditors' rights generally and by general equitable
principles (whether considered in a proceeding in equity or at
law) and an implied covenant of good faith and fair dealing.
(ii) The Indenture constitutes a valid and legally
binding obligation of the Company and each of the Guarantors
enforceable against the Company and each of the Guarantors in
accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting
creditors' rights and to general equity principles (whether
considered in a proceeding in equity or at law) and an implied
covenant of good faith and fair dealing.
(iii) At such time as the Exchange Notes are issued,
executed, authenticated and delivered in accordance with the
terms of the Exchange Offer and the Indenture, the Exchange
Notes will be entitled to the benefits of the Indenture and
will be the valid and legally binding obligations of the
Company, enforceable against the Company in accordance with
their terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors'
rights and to general equity principles (whether considered in
a proceeding in equity or at law) and an implied covenant of
good faith and fair dealing.
21
(iv) When the Offered Securities have been issued,
executed and authenticated in accordance with the Indenture
and delivered to and paid for by the Initial Purchasers in
accordance with the terms of this Agreement, the Guarantee of
each Guarantor endorsed thereon will constitute the valid and
legally binding obligation of such Guarantor, enforceable
against such Guarantor in accordance with its terms, subject
to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and
to general equity principles (whether considered in a
proceeding in equity or at law) and an implied covenant of
good faith and fair dealing.
(v) At such time as the Exchange Notes have been issued,
executed, authenticated and delivered in accordance with the
terms of the Exchange Offer and the Indenture, and upon the
due execution and delivery of the Exchange Guarantee by each
such Guarantor in a form substantially identical to the
Guarantee, the Exchange Guarantee of each Guarantor so
endorsed thereon will constitute the valid and legally binding
obligation of such Guarantor, enforceable against such
Guarantor in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium
and similar laws of general applicability relating to or
affecting creditors' rights and to general equity principles
(whether considered in a proceeding in equity or at law) and
an implied covenant of good faith and fair dealing.
(vi) This Agreement and the Registration Rights Agreement
each constitutes a valid and binding agreement of the Company
and each of the Guarantors enforceable against the Company and
each of the Guarantors in accordance with its terms, subject
to the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, general
equitable principles (whether considered in a proceeding in
equity or at law), or an implied covenant of good faith and
fair dealing and except with respect to the rights of
indemnification and contribution thereunder, where enforcement
thereof may be limited by state or federal securities laws or
the policies underlying such laws.
..
(e) The Initial Purchasers shall have received an opinion,
dated the Closing Date, of Xxxxxxxx & Xxxx, X.X., Utah counsel for the
Company, that:
(i) Each of the Utah Guarantors has been duly
incorporated and is a validly existing corporation under the
laws of the State of Utah, with corporate power and authority
to own its properties and conduct its business as described in
the Offering Document; and each such Utah Guarantor is duly
qualified to do business as a foreign corporation in good
standing in all other jurisdictions identified by the Company
(x) in which its ownership or lease of property or the conduct
of its business requires such qualification, and (y) where the
failure to so qualify could reasonably be anticipated to
result in a Material Adverse Effect.
22
(ii) The Indenture has been duly authorized, executed and
delivered by each of the Utah Guarantors.
(iii) The Guarantee to be endorsed on the Offered
Securities by each of the Utah Guarantors has been duly
authorized by each such Utah Guarantor, and has been duly
executed and delivered by each such Utah Guarantor, and
conforms to the description thereof contained in the Offering
Document.
(iv) The Exchange Guarantee to be endorsed on the
Exchange Notes by each Utah Guarantor has been duly authorized
by each such Utah Guarantor.
(v) No consent, approval, authorization or order of, or
filing with, any governmental agency or body or any court is
required to be obtained or made by any of the Utah Guarantors
for the consummation of the transactions contemplated by this
Agreement or the Registration Rights Agreement in connection
with the issuance or sale of the Offered Securities by the
Utah Guarantors, except such as may be required under state
securities laws and except for the order of the Commission
declaring the Exchange Offer Registration Statement or the
Shelf Registration Statement effective.
(vi) The execution, delivery and performance of the
Indenture, this Agreement and the Registration Rights
Agreement and the issuance and sale of the Offered Securities
and compliance with the terms and provisions thereof will not
result in a breach or violation of any of the terms and
provisions of, or constitute a default under, any statute,
rule, regulation or, to such counsel's knowledge, order of any
governmental agency or body or any court having jurisdiction
over any of the Utah Guarantors, or any of their respective
properties, or any agreement identified to such counsel by the
Company as material and listed on a Schedule attached to such
counsel's opinion to which any of the Utah Guarantors is a
party or by which any of the Utah Guarantors is bound or to
which any of the properties of the Utah Guarantors is subject,
or the charter or by-laws of any of the Utah Guarantors, and
each of the Utah Guarantors has full corporate power and
authority to authorize, issue and sell the Offered Securities
as contemplated by this Agreement.
(vii) This Agreement and the Registration Rights Agreement
have each been duly authorized, executed and delivered by each
of the Utah Guarantors.
(f) The Initial Purchasers shall have received an opinion,
dated the Closing Date, Xxxx Xxxxxxxx, Esq., general counsel to the
Company, that:
(i) None of the Utah Guarantors (i) is in violation of
its respective charter or by-laws; or (ii) to such counsel's
knowledge, is in default, and no event has occurred which,
with notice or lapse of time or both would constitute such
default, in the due performance or observance of any
obligation, agreement, covenant or condition contained in any
material indenture, loan agreement, mortgage, deed of trust,
lease or other agreement or instrument to which it is a party
or by which it is bound or to which any of its properties or
assets is subject,
23
and which such agreements are set forth on a Schedule attached
to such counsel's opinion.
(ii) Except as described or referred to in the Offering
Document, there are no pending actions, suits or proceedings
against or, to the Company's knowledge, affecting the Company,
any of the Guarantors, any of their respective subsidiaries or
any of their respective properties that, if determined
adversely to the Company, any of the Guarantors or any of
their respective subsidiaries, would individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect, or would reasonably be expected to materially and
adversely affect the ability of the Company or any of the
Guarantors to perform their obligations under the Indenture,
this Agreement or the Registration Rights Agreement, or which
are otherwise material in the context of the sale of the
Offered Securities; and to such counsel's knowledge, no such
actions, suits or proceedings are threatened or contemplated.
(iii) There are no contracts, agreements or understandings
between the Company or any Guarantor and any person (other
than the Registration Rights Agreement and the registration
rights agreement entered into by the Company in connection
with the issuance of the Company's 12% Senior Subordinated
Notes due 2005) granting such person the right to require the
Company or such Guarantor to file a registration statement
under the Securities Act with respect to any securities of the
Company or such Guarantor owned or to be owned by such person
or to require the Company or such Guarantor to include such
securities with the Offered Securities and the Guarantees
registered pursuant to the Registration Rights Agreement or in
any securities being registered pursuant to any other
registration statement filed by the Company or any Guarantor
under the Securities Act.
(g) The Initial Purchasers shall have received an opinion,
dated the Closing Date, of Holmested & Associes, special Quebec counsel
for the Company, that:
(i) ICON Canada has been duly incorporated and is a
validly existing corporation in good standing under the laws
of the province of Quebec, with corporate power and authority
to own its properties and conduct its business as described in
the Offering Document; and such subsidiary is duly qualified
to do business as a foreign corporation in good standing in
all other jurisdictions identified by the Company (x) in which
its ownership or lease of property or the conduct of its
business requires such qualification, and (y) where the
failure to so qualify could reasonably be anticipated to
result in a Material Adverse Effect.
(ii) The Indenture has been duly authorized, executed and
delivered by ICON Canada.
(iii) The Guarantee to be endorsed on the Offered
Securities by ICON Canada has been duly authorized by ICON
Canada, and has been duly executed
24
and delivered by ICON Canada, and conforms to the description
thereof contained in the Offering Document.
(iv) The Exchange Guarantee to be endorsed on the
Exchange Notes by ICON Canada has been duly authorized by ICON
Canada.
(v) No consent, approval, authorization or order of, or
filing with, any governmental agency or body or any court is
required to be obtained or made by ICON Canada for the
consummation of the transactions contemplated by this
Agreement or the Registration Rights Agreement in connection
with the issuance or sale of the Offered Securities by ICON
Canada, except such as may be required under state securities
laws and except for the order of the Commission declaring the
Exchange Offer Registration Statement or the Shelf
Registration Statement effective.
(vi) The execution, delivery and performance of the
Indenture, this Agreement and the Registration Rights
Agreement and the issuance and sale of the Offered Securities
and compliance with the terms and provisions thereof will not
result in a breach or violation of any of the terms and
provisions of, or constitute a default under, any statute,
rule, regulation or order of any governmental agency or body
or any court having jurisdiction over ICON Canada, or any of
its properties, or any agreement identified to such counsel by
the Company and listed on a Schedule to such counsel's opinion
to which ICON Canada is a party or by which ICON Canada is
bound or to which any of the properties of ICON Canada is
subject, or the charter or by-laws of ICON Canada, and ICON
Canada has full power and authority to authorize, issue and
sell the Offered Securities as contemplated by this Agreement.
(vii) This Agreement and the Registration Rights Agreement
have each been duly authorized, executed and delivered by ICON
Canada.
(h) The Initial Purchasers shall have received an opinion,
dated the Closing Date, of XxXxxxx, Xxxxxx & Xxxxxxxxx, special New
Brunswick counsel for the Company, that:
(i) N.B. Ltd. has been duly incorporated and is a
validly existing corporation in good standing under the laws
of the province of New Brunswick, with corporate power and
authority to own its properties and conduct its business as
described in the Offering Document; and N.B. Ltd. is duly
qualified to do business as a foreign corporation in good
standing in all other jurisdictions identified by the Company
(x) in which its ownership or lease of property or the conduct
of its business requires such qualification, and (y) where the
failure to so qualify could reasonably be anticipated to
result in a Material Adverse Effect.
(ii) The Indenture has been duly authorized, executed and
delivered by N.B. Ltd.
25
(iii) The Guarantee to be endorsed on the Offered Securities by
N.B. Ltd. has been duly authorized by N.B. Ltd., and has been duly
executed and delivered by N.B. Ltd., and conforms to the description
thereof contained in the Offering Document.
(iv) The Exchange Guarantee to be endorsed on the Exchange Notes
by N.B. Ltd. has been duly authorized by N.B. Ltd.
(v) No consent, approval, authorization or order of, or filing
with, any governmental agency or body or any court is required to be
obtained or made by N.B. Ltd. for the consummation of the transactions
contemplated by this Agreement or the Registration Rights Agreement in
connection with the issuance or sale of the Offered Securities by N.B.
Ltd., except such as may be required under state securities laws and
except for the order of the Commission declaring the Exchange Offer
Registration Statement or the Shelf Registration Statement effective.
(vi) The execution, delivery and performance of the Indenture,
this Agreement and the Registration Rights Agreement and the issuance
and sale of the Offered Securities and compliance with the terms and
provisions thereof will not result in a breach or violation of any of
the terms and provisions of, or constitute a default under, any
statute, rule, regulation or order of any governmental agency or body
or any court having jurisdiction over N.B. Ltd., or any of its
properties, or any agreement identified to such counsel by the Company
and listed on a Schedule to such counsel's opinion to which N.B. Ltd.
is a party or by which N.B. Ltd. is bound or to which any of the
properties of N.B. Ltd. is subject, or the charter or by-laws of N.B.
Ltd., and N.B. Ltd. has full power and authority to authorize, issue
and sell the Offered Securities as contemplated by this Agreement.
(vii) This Agreement and the Registration Rights Agreement have
each been duly authorized, executed and delivered by N.B. Ltd.
(i) The Initial Purchasers shall have received from Xxxxxx & Xxxxxxx,
counsel for the Initial Purchasers, such opinion or opinions, dated the
Closing Date, with respect to the incorporation of the Company, the
validity of the Offered Securities, the Offering Document, the exemption
from registration for the offer and sale of the Offered Securities by the
Company to the Initial Purchasers and the resales by the several Initial
Purchasers as contemplated hereby and other related matters as CSFBC may
require, and the Company and each of the Guarantors shall have furnished to
such counsel such documents as they request for the purpose of enabling
them to pass upon such matters.
(j) The Initial Purchasers shall have received a certificate, dated
the Closing Date, of the President or any Vice President and a principal
financial or accounting officer of the Company and each of the Guarantors
in which such officers, to the best of their knowledge after reasonable
investigation, shall state that the representations and warranties of the
Company and each of the Guarantors in this Agreement are true and correct,
that the Company and each of the Guarantors has complied with all
agreements and satisfied all
26
conditions on its part to be performed or satisfied hereunder at or prior
to the Closing Date, and that, subsequent to the respective dates of the
most recent financial statements in the Offering Document there has been no
material adverse change, nor any development or event involving a
prospective material adverse change, in the condition (financial or other),
business, properties or results of operations of the Company, any of the
Guarantors or any of their respective subsidiaries taken as a whole except
as set forth in or contemplated by the Offering Document or as described in
such certificate and such other matters as CSFBC may require.
(k) The Initial Purchasers shall have received a letter, dated the
Closing Date, of PricewaterhouseCoopers LLP which meets the requirements of
subsection (a) of this Section 6, except that the specified date referred
to in such subsection will be a date not more than three days prior to the
Closing Date for the purposes of this subsection.
(l) The Company shall have given notice of redemption to each holder
of the Company's 12% Senior Subordinated Notes due 2005 prior to, or
simultaneously with, the Closing Date, or made such other arrangements with
respect to the redemption of such notes, as shall be reasonably
satisfactory to the Initial Purchasers.
(m) The Company shall have consummated the Credit Agreement prior to,
or simultaneously with, the Closing Date on substantially the same terms
described in the Offering Document and the Initial Purchasers shall have
received counterparts, conformed as executed, of the Credit Agreement and
such other documentation as they deem necessary to evidence the
consummation thereof.
The Company and each of the Guarantors will furnish the Initial Purchasers with
such conformed copies of such opinions, certificates, letters and documents as
the Initial Purchasers reasonably requests. CSFBC may in its sole discretion
waive on behalf of the Initial Purchasers compliance with any conditions to the
obligations of the Initial Purchasers hereunder
7. Indemnification and Contribution. (a) The Company and each of the
Guarantors, jointly and severally, shall indemnify and hold harmless the Initial
Purchasers, its partners, directors and officers and each person, if any, who
controls the Initial Purchasers within the meaning of Section 15 of the
Securities Act, against any losses, claims, damages or liabilities, joint or
several, to which the Initial Purchasers may become subject, under the
Securities Act or the Exchange Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon any breach of any of the representations and warranties of the Company or
any of the Guarantors contained herein or any untrue statement or alleged untrue
statement of any material fact contained in the Offering Document, or any
amendment or supplement thereto, or any related preliminary offering circular,
or arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, including any losses, claims, damages or liabilities
arising out of or based upon the Company's or any of the Guarantor's failure to
perform its obligations under Section 5(a) of this Agreement, and will reimburse
the Initial Purchasers for any legal or other expenses reasonably incurred by
the Initial Purchasers in connection with investigating or defending any such
loss, claim, damage, liability or action as such expenses are incurred;
provided, however,
27
that (i) neither the Company nor any Guarantor shall be liable in any such case
to the extent that any such loss, claim, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement in or omission or
alleged omission from any of such documents in reliance upon and in conformity
with written information furnished to the Company or any of the Guarantors by
any Initial Purchaser through CSFBC specifically for use therein, it being
understood and agreed that the only such information consists of the information
described as such in subsection (b) below and (ii) with respect to any untrue
statement or alleged untrue statement in or omission or alleged omission from
the Preliminary Offering Circular, the indemnity agreement contained in this
Section 7(a) shall not inure to the benefit of any Initial Purchaser (or any
partner, director or officer of such Initial Purchaser or any person who
controls such Initial Purchaser) from whom the person asserting any such loss,
claim, damage or liability purchased the Offered Securities concerned in any
initial resale of the Offered Securities by such Initial Purchaser, to the
extent that any such loss, claim, damage or liability occurs under the
circumstance where it shall have be determined by a court of competent
jurisdiction that (A) the untrue statement or alleged untrue statement in or
omission or alleged omission from the Preliminary Offering Circular was
corrected in the Offering Circular, (B) the Company had previously furnished
copies of the Offering Circular to the Initial Purchasers and (C) the person
asserting such loss, claim, damage or liability was not sent or given a copy of
the Offering Circular at or prior to the written confirmation of the sale of
such Offered Securities.
(b) Each Initial Purchaser shall severally and not jointly indemnify and
hold harmless the Company and each of the Guarantors, their respective directors
and officers and each person, if any, who controls the Company or any of the
Guarantors within the meaning of Section 15 of the Securities Act, against any
losses, claims, damages or liabilities to which the Company or any of the
Guarantors may become subject, under the Securities Act or the Exchange Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the Offering Document, or any
amendment or supplement thereto, or any related preliminary offering circular,
or arise out of or are based upon the omission or the alleged omission to state
therein a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written information
furnished to the Company or any of the Guarantors by such Initial Purchaser
through CSFBC specifically for use therein, and will reimburse any legal or
other expenses reasonably incurred by the Company and any Guarantor in
connection with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred, it being understood and
agreed that the only such information furnished by any Initial Purchaser consist
of the following information in the Offering Document furnished by the Initial
Purchasers: the third, fifth, tenth and fourteenth paragraphs under the caption
"Plan of Distribution;" provided however, that the Initial Purchasers shall not
be liable for any losses, claims, damages or liabilities arising out of or based
upon the Company's or any of the Guarantor's failure to perform their respective
obligations under Section 5(a) of this Agreement.
(c) Promptly after receipt by an indemnified party under this Section of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
subsection (a) or (b) above, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not
28
relieve it from any liability which it may have to any indemnified party
otherwise than under subsection (a) or (b) above except to the extent that it
has been materially prejudiced by such failure. In case any such action is
brought against any indemnified party and it notifies the indemnifying party of
the commencement thereof, the indemnifying party will be entitled to participate
therein and, to the extent that it may wish, jointly with any other indemnifying
party similarly notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party (who shall not, except with the consent
of the indemnified party, be counsel to the indemnifying party), and after
notice from the indemnifying party to such indemnified party of its election so
to assume the defense thereof, the indemnifying party will not be liable to such
indemnified party under this Section 7 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation. No indemnifying party
shall, without the prior written consent of the indemnified party (which consent
shall not be unreasonably withheld), effect any settlement of any pending or
threatened action in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
party unless such settlement includes (i) an unconditional release of such
indemnified party from all liability on any claims that are the subject matter
of such action and (ii) does not include a statement as to or an admission of
fault, culpability or failure to act by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 7 is unavailable
or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities referred to in subsection (a) or (b) above (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company and the
Guarantors on the one hand and the Initial Purchasers on the other from the
offering of the Offered Securities or (ii) if the allocation provided by clause
(i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company and the Guarantors on the one
hand and the Initial Purchasers on the other in connection with the statements
or omissions which resulted in such losses, claims, damages or liabilities as
well as any other relevant equitable considerations. The relative benefits
received by the Company and the Guarantors on the one hand and the Initial
Purchasers on the other shall be deemed to be in the same proportion as the
total net proceeds from the offering (before deducting expenses) received by the
Company and the Guarantors bear to the total discounts and commissions received
by the Initial Purchasers from the Company and each of the Guarantors under this
Agreement. The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company, any Guarantor or the Initial Purchasers and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act or any comparable provision of any other securities law) shall be
entitled to contribution from any person who is not guilty of such fraudulent
misrepresentation. The amount paid by an indemnified party as a result of the
losses, claims, damages or liabilities referred to in the first sentence of this
subsection (d) shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending
any action or claim which is the subject of this subsection (d). Notwithstanding
the provisions of this subsection (d), no Initial Purchasers shall not be
required to contribute any amount in excess of the amount by which the total
discounts, fees and
29
commissions received by such Initial Purchaser 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. The
Initial Purchasers' obligations in this subsection (d) to contribute are several
in proportion to their respective purchase obligations and not joint.
(e) The obligations of the Company and each Guarantor under this Section 7
shall be in addition to any liability which the Company and each Guarantor may
otherwise have and shall extend, upon the same terms and conditions, to each
person, if any, who controls the Initial Purchasers within the meaning of the
Securities Act or the Exchange Act; and the obligations of the Initial
Purchasers under this Section 7 shall be in addition to any liability which the
Initial Purchasers may otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls the Company and the Guarantors
within the meaning of the Securities Act or the Exchange Act.
8. Default of Initial Purchasers. If any Initial Purchaser or Initial
Purchasers default in their obligations to purchase Offered Securities hereunder
and the aggregate principal amount of Offered Securities that such defaulting
Initial Purchaser or Initial Purchasers agreed but failed to purchase does not
exceed 10% of the total principal amount of Offered Securities, CSFBC may make
arrangements satisfactory to the Company for the purchase of such Offered
Securities by other persons, including any of the Initial Purchasers, but if no
such arrangements are made by the Closing Date, the non-defaulting Initial
Purchasers shall be obligated severally, in proportion to their respective
commitments hereunder, to purchase the Offered Securities that such defaulting
Initial Purchasers agreed but failed to purchase. If any Initial Purchaser or
Initial Purchasers so default and the aggregate principal amount of Offered
Securities with respect to which such default or defaults occur exceeds 10% of
the total principal amount of Offered Securities and arrangements satisfactory
to CSFBC and the Company for the purchase of such Offered Securities by other
persons are not made within 36 hours after such default, this Agreement will
terminate without liability on the part of any non-defaulting Initial Purchaser,
the Company or any Guarantor, except as provided in Section 9. As used in this
Agreement, the term "Initial Purchaser" includes any person substituted for an
Initial Purchaser under this Section. Nothing herein will relieve a defaulting
Initial Purchaser from liability for its default.
9. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Company, each of the Guarantors or their respective officers and of the Initial
Purchasers set forth in or made pursuant to this Agreement will remain in full
force and effect, regardless of any investigation, or statement as to the
results thereof, made by or on behalf of the Initial Purchasers, the Company,
any of the Guarantors or any of their respective representatives, officers or
directors or any controlling person, and will survive delivery of and payment
for the Offered Securities. If this Agreement is terminated pursuant to Section
8 or if for any reason the purchase of the Offered Securities by the Purchasers
is not consummated, the Company and the Guarantors shall remain responsible for
the expenses to be paid or reimbursed by it pursuant to Section 5(h) and the
respective obligations of the Company, the Guarantors and the Initial Purchasers
pursuant to Section 7 shall remain in effect. If the purchase of the Offered
Securities by the Initial Purchasers is not consummated for any reason other
than solely because of the termination of this Agreement pursuant to Section 8
or the occurrence of any event specified in Section 6(b)(i) or clause (C), (D),
(E) or (F) of Section 6(b)(ii),
30
the Company and the Guarantors will reimburse the Initial Purchasers for all
out-of-pocket expenses (including fees and disbursements of counsel) reasonably
incurred in connection with the offering of the Offered Securities.
10. Notices. All communications hereunder will be in writing and, if
sent to the Initial Purchasers will be mailed, delivered or telegraphed and
confirmed to the Initial Purchasers, c/o Credit Suisse First Boston Corporation,
Eleven Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, Attention: Transactions
Advisory Group, or, if sent to the Company or any of the Guarantors, will be
mailed, delivered or telegraphed and confirmed to it at Icon Health & Fitness,
Inc., 0000 Xxxxx 0000, Xxxxx, Xxxx 00000, Attention: Xxxx Xxxxxxxx, Esq.;
provided, however, that any notice to an Initial Purchaser pursuant to Section 7
will be mailed, delivered or telegraphed and confirmed to such Initial
Purchaser.
11. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
controlling persons referred to in Section 7, and no other person will have any
right or obligation hereunder, except that holders of Offered Securities shall
be entitled to enforce the agreements for their benefit contained in the second
and third sentences of Section 5(b) hereof against the Company and each of the
Guarantors as if such holders were parties thereto.
12. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
13. Applicable Law. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York without regard to
principles of conflicts of laws.
The Company and each of the Guarantors hereby submit to the
non-exclusive jurisdiction of the Federal and State courts in the Borough of
Manhattan in The City of New York in any suit or proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby.
31
If the foregoing is in accordance with the Initial Purchasers'
understanding of our agreement, kindly sign and return to us one of the
counterparts hereof, whereupon it will become a binding agreement between the
Company, each of the Guarantors and the several Initial Purchasers in accordance
with its terms.
Very truly yours,
32
ICON HEALTH & FITNESS, INC.
By: _____________________________
Name:
Title:
GUARANTORS:
JUMPKING, INC.
By: _____________________________
Name:
Title:
UNIVERSAL TECHNICAL SERVICES
By: _____________________________
Name:
Title:
ICON INTERNATIONAL HOLDINGS, INC.
By: _____________________________
Name:
Title:
ICON IP, INC.
By: _____________________________
Name:
Title:
33
FREE MOTION FITNESS, INC.
By: _____________________________
Name:
Title:
NORDICTRACK, INC.
By: _____________________________
Name:
Title:
510152 N.B. LTD.
By: _____________________________
Name:
Title:
ICON DU CANADA INC.
By: _____________________________
Name:
Title:
34
The foregoing Purchase Agreement is hereby
confirmed and accepted as of the date first
above written.
Credit Suisse First Boston
Corporation,
By: _________________________
Name:
Title:
Acting on behalf of itself and as the
Representative of the several Initial
Purchasers
35
SCHEDULE A
Principal Amount of
Offered Securities
-------------------
Manager
-------
Credit Suisse First Boston Corporation ............ $124,000,000
X.X. Xxxxxx Securities Inc. ....................... $ 19,375,000
Fleet Securities, Inc. ............................ $ 11,625,000
------------
Total ................... $155,000,000
============
36
SCHEDULE B
Subsidiaries of the Company
Jumpking, Inc.
Universal Technical Services
ICON International Holdings, Inc.
ICON IP, Inc.
Free Motion Fitness, Inc.
NordicTrack, Inc.
510152 N.B. Ltd.
ICON du Canada Inc.,
ICON Health & Fitness (Holdings) Ltd.
ICON OS, Inc.
ICON Health & Fitness Italia SRL
ICON Fitness Lifestyle
ICON Health & Fitness France SA
AICON Health & Fitness GmbH
Weider Health & Fitness France SA
37
EXHIBIT I
[Form of Registration Rights Agreement]
38
