EXHIBIT 1.2
EXECUTION COPY
$700,000,000
X. X. Xxxxx Finance Company
6.00% Guaranteed Notes due March 15, 2012
unconditionally and irrevocably guaranteed by
X. X. Xxxxx Company
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Purchase Agreement
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February 28, 2002
X.X. Xxxxxx Securities Inc.,
As representative of the several Purchasers
named in Schedule I to the Purchase Agreement
000 Xxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
X.X. Xxxxx Finance Company, a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions stated herein, to issue and sell
to the Purchasers named in Schedule I hereto (the "Purchasers") an aggregate of
$700,000,000 principal amount of its 6.00% Guaranteed Notes due March 15, 2012.
The Notes will be unconditionally and irrevocably guaranteed as to the payment
of principal and interest (the "Guarantees") by X.X. Xxxxx Company, a
Pennsylvania corporation (the "Guarantor"). The Notes and the Guarantees are
hereinafter collectively referred to as the "Securities".
1. The Company (in respect of itself) and the Guarantor (in respect of
itself and the Company) represent and warrant to, and agree with, each of the
Purchasers that:
(a) An offering memorandum, dated February 28, 2002 (the "Offering
Memorandum"), which incorporates by reference the Guarantor's Annual Report on
Form 10-K for the fiscal year ended May 2, 2001, its Quarterly Reports on Form
10-Q for the quarters ended August 1, 2001 and October 31, 2001, and its
Current Reports on Form 8-K dated June 26, 2001, September 17, 2001 and
November 13, 2001, has been prepared in connection with the offering of the
Securities. Any reference to the Offering Memorandum, as amended or
supplemented, as of any specified date, shall be deemed to include (i) any
documents filed with the Securities and Exchange Commission (the
"Commission") pursuant to Section 13(a), 13(c) or 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), after the date of the
Offering Memorandum and prior to such specified date and (ii) any Additional
Issuer Information (as defined in Section 5(f)) furnished by the Company or the
Guarantor prior to the completion of the distribution of the Securities; and
all documents filed under the Exchange Act and so deemed to be included in the
Offering Memorandum, or any amendment or supplement thereto, are hereinafter
called the "Exchange Act Reports". The Exchange Act Reports, when they were or
are filed with the Commission, conformed or will conform in all material
respects to the applicable requirements of the Exchange Act and the applicable
rules and regulations of the Commission thereunder. The Offering Memorandum and
any amendments or supplements thereto and the Exchange Act Reports did not and
will not, as of their respective dates, contain an untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by a Purchaser
through you expressly for use therein;
(b) None of the Company, the Guarantor nor any of the Guarantor's
subsidiaries (including the Company) has sustained since the date of the latest
audited consolidated financial statements of the Guarantor incorporated by
reference in the Offering Memorandum any material loss or interference with its
business otherwise than as set forth or contemplated in the Offering
Memorandum; and, since the respective dates as of which information is given in
the Offering Memorandum, there has not been any change in the capital stock or
long-term debt of the Guarantor and its subsidiaries (including the Company),
or any material adverse change, or any development that is reasonably likely to
cause a prospective material adverse change, in or affecting the general
affairs, management, financial position, stockholders' equity or results of
operations of the Guarantor and its subsidiaries (including the Company), taken
as a whole, otherwise than as set forth or contemplated in the Offering
Memorandum;
(c) The Guarantor and the Guarantor's principal domestic subsidiaries (the
Company, X.X. Xxxxx Company, L.P., CMH, Inc., Trademark Management Company, and
Promark International, Inc., collectively, the "Principal Subsidiaries"), have
good and marketable title to all real property and to all personal property
owned by them;
(d) Each of the Company and the Guarantor has been duly incorporated and
is validly existing as a corporation in good standing under the laws of its
jurisdiction of incorporation, with power and authority to own its properties
and conduct its business as described in the Offering Memorandum, and has been
duly qualified as a foreign corporation for the transaction of business and is
in good standing under the laws of each other jurisdiction in which it owns or
leases properties or conducts any business so as to require such qualification,
except to the extent that the failure to be so qualified in any such
jurisdiction would not have a material adverse effect on the Guarantor and its
subsidiaries (including the Company) taken as a whole; and each other Principal
Subsidiary has been duly organized and is validly existing in good standing
under the laws of its jurisdiction of organization, with power and authority to
own its properties and conduct its business as described in the Offering
Memorandum;
(e) Each of the Company and the Guarantor has an authorized capitalization
as set forth in the Offering Memorandum, and all of the issued shares of
capital stock of the Company and the Guarantor have been duly and validly
authorized and issued and are fully paid and non-assessable;
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and all of the issued shares of capital stock or partnership interests, as the
case may be, of each other Principal Subsidiary have been duly and validly
authorized and issued, are fully paid and non-assessable and (except for
directors' qualifying shares and except as otherwise set forth in the Offering
Memorandum) are owned directly or indirectly by the Company or the Guarantor,
as the case may be, free and clear of all liens, encumbrances, equities or
claims;
(f) The Securities have been duly authorized and, when issued and
delivered pursuant to this Agreement and the Indenture (hereinafter defined)
will have been duly executed, authenticated, issued and delivered and will
constitute valid and legally binding obligations of the Company and the
Guarantor entitled to the benefits provided by the Indenture dated as of July
6, 2001 (the "Indenture"), between the Company and Bank One, National
Association, as Trustee (the "Trustee"), under which they are to be issued; the
Indenture has been duly authorized, executed and delivered by the Company and
the Guarantor, and constitutes a valid and legally binding instrument,
enforceable in accordance with its terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity principles;
and the Securities and the Indenture will conform to the descriptions thereof
in the Offering Memorandum;
(g) None of the transactions contemplated by this Agreement (including,
without limitation, the use of the proceeds from the sale of the Securities)
will violate or result in a violation of Section 7 of the Exchange Act, or any
regulation promulgated thereunder, including, without limitation, Regulations
G, T, U, and X of the Board of Governors of the Federal Reserve System;
(h) Prior to the date hereof, neither the Company, the Guarantor nor any
of their affiliates has taken any action which is designed to or which has
constituted or which might have been expected to cause or result in
stabilization or manipulation of the price of any security of the Company or
the Guarantor in connection with the offering of the Securities;
(i) The issue and sale of the Securities and the compliance by the Company
and the Guarantor with all of the provisions of the Securities, the Indenture
and this Agreement and the consummation of the transactions herein and therein
contemplated will not conflict with or result in a breach or violation of any
of the terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which the Company or the Guarantor is a party or by which the Company or the
Guarantor is bound or to which any of the property or assets of the Company or
the Guarantor is subject, nor will such action result in any violation of the
provisions of the Certificate of Incorporation or By-laws of the Company or the
Guarantor or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or the
Guarantor or any of either of their respective properties; and no consent,
approval, authorization, order, registration or qualification of or with any
such court or governmental agency or body is required for the issue and sale of
the Securities or the consummation by the Company or the Guarantor of the
transactions contemplated by this Agreement or the Indenture, except for the
filing of a registration statement by the Company and the Guarantor with the
Commission pursuant to the Securities Act of 1933, as amended (the "Act"),
pursuant to Section 5(l) hereof, and such consents, approvals, authorizations,
registrations or qualifications as may be required under state securities or
Blue Sky laws in connection with the purchase and distribution of the
Securities by the Purchasers;
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(j) None of the Guarantor, the Company or the other Principal Subsidiaries
is in violation of its Certificate of Incorporation or By-laws or Partnership
Agreement, as the case may be, or in default in the performance or observance
of any material obligation, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement, lease or other agreement or instrument
to which it is a party or by which it or any of its properties may be bound,
which default has not been irrevocably waived and would have a material adverse
effect on the business, operations or financial condition of the Company or the
Guarantor and its subsidiaries taken as a whole;
(k) The statements set forth in the Offering Memorandum under the caption
"Description of the Notes", insofar as they purport to constitute a summary of
the terms of the Securities, and under the caption "Plan of Distribution",
insofar as they purport to describe the provisions of the laws and documents
referred to therein, are accurate, and fair;
(l) Other than as set forth in the Offering Memorandum, there are no legal
or governmental proceedings pending to which the Guarantor, the Company or any
of the other Principal Subsidiaries is a party or, to the Company's and the
Guarantor's knowledge, of which any property of the Guarantor, the Company or
any of the other Principal Subsidiaries is the subject, which, if determined
adversely to the Company or the Guarantor or any of its subsidiaries, would
have a material adverse effect on the consolidated financial position,
stockholders' equity or results of operations of the Company or the Guarantor
and its subsidiaries (including the Company) taken as a whole; and, to the best
of the Company's and the Guarantor's knowledge, no such proceedings have been
overtly threatened;
(m) When the Securities are issued and delivered pursuant to this
Agreement, the Securities will not be of the same class (within the meaning of
Rule 144A under the Act) as securities which are listed on a national
securities exchange registered under Section 6 of the Exchange Act or quoted in
a U.S. automated inter-dealer quotation system;
(n) The Guarantor is a "reporting issuer" as defined by Regulation S under
the Act;
(o) The Company is not and, after giving effect to the offering and sale
of the Securities, will not be an "investment company", as such term is defined
in the Investment Company Act of 1940, as amended (the "Investment Company
Act");
(p) Neither the Company, the Guarantor nor any person acting on its or
their behalf has offered or will offer or sell the Securities by means of any
general solicitation or general advertising within the meaning of Rule 502(c)
under the Act or, with respect to Securities sold outside the United States to
non-U.S. persons (as defined in Rule 902 under the Act), by means of any
directed selling efforts within the meaning of Rule 902 under the Act, and the
Company and the Guarantor and any person acting on its or their behalf have
complied with and will comply with the offering restriction requirements of
Rule 903 under the Act;
(q) Within the preceding six months, neither the Company nor any other
person acting on behalf of the Company has offered or sold to any person any of
the Securities, or any securities of the same or a similar class as the
Securities, other than Securities offered or sold to the Purchasers hereunder.
The Company will take reasonable precautions designed to insure that any offer
or sale, direct or indirect, in the United States or to any U.S. person (as
defined in Rule 902 under the Act) of any Securities or any substantially
similar security issued by the Company, within six months
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subsequent to the date on which the distribution of the Securities has been
completed (as notified to the Company by you), is made under restrictions and
other circumstances reasonably designed not to affect the status of the offer
and sale of the Securities in the United States and to U.S. persons
contemplated by this Agreement as transactions exempt from the registration
provisions of the Act; and
(r) PricewaterhouseCoopers LLP, who have audited certain financial
statements of the Company, the Guarantor and its subsidiaries, are independent
public accountants with respect to the Company, the Guarantor and its
subsidiaries as required by the Act and the rules and regulations of the
Commission thereunder.
2. Subject to the terms and conditions herein set forth, the Company
agrees to issue and sell to each of the Purchasers, and each of the Purchasers
agrees, severally and not jointly, to purchase from the Company, at a purchase
price of 98.599% of the principal amount thereof, plus accrued interest, if
any, from March 7, 2002 to the Time of Delivery hereunder, the principal amount
of Securities set forth opposite the name of such Purchaser in Schedule I
hereto.
3. Upon the authorization by you of the release of the Securities, the
several Purchasers propose to offer the Securities for sale upon the terms and
conditions set forth in this Agreement and the Offering Memorandum and each
Purchaser hereby represents and warrants to, and agrees with the Company and
the Guarantor that:
(a) It will offer and sell the Securities only to: (i) persons who it
reasonably believes are "qualified institutional buyers" ("QIBs") within the
meaning of Rule 144A under the Act in transactions meeting the requirements of
Rule 144A or (ii) upon the terms and conditions set forth in Annex I to this
Agreement; and
(b) It will not offer or sell the Securities by any form of general
solicitation or general advertising, including but not limited to the methods
described in Rule 502(c) under the Act.
4. (a) The Securities to be purchased by each Purchaser hereunder will be
represented by one or more definitive global Securities in book-entry form
which will be deposited by or on behalf of the Company with The Depository
Trust Company ("DTC") or its designated custodian. The Company will deliver the
Securities to you, for the account of each Purchaser, against payment by or on
behalf of such Purchaser of the purchase price therefor in Federal (same day)
funds, by causing DTC to credit the Securities to your account at DTC. The
Company will cause the certificates representing the Securities to be made
available to you for checking at least twenty-four hours prior to the Time of
Delivery (as defined below) at the office of DTC or its designated custodian
(the "Designated Office"). For purposes of Rule 15c6-1 of the Exchange Act, the
Time of Delivery shall be the date and time for the payment of funds and
delivery of securities for all of the Securities sold pursuant to the offering.
The time and date of such delivery and payment shall be 9:30 a.m., New York
City time, on March 7, 2002 or such other time and date as you and the Company
may agree upon in writing. Such time and date are herein called the "Time of
Delivery".
(b) The documents to be delivered at the Time of Delivery by or on behalf
of the parties hereto pursuant to Section 7 hereof, including the cross-receipt
for the Securities and any additional documents requested by the Purchasers
pursuant to Section 7(g) hereof, will be delivered at such time and date at the
offices of X.X. Xxxxx Finance Company, 000 Xxxxx Xxxxxx, 00xx Xxxxx,
Xxxxxxxxxx,
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PA 15219 (the "Closing Location"), and the Securities will be delivered at the
Designated Office, all at the Time of Delivery. A meeting will be held at the
Closing Location at 2:00 p.m., New York City time, on the New York Business Day
next preceding the Time of Delivery, at which meeting the final drafts of the
documents to be delivered pursuant to the preceding sentence will be available
for review by the parties hereto. For the purposes of this Section 4, "New York
Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in New York are generally
authorized or obligated by law or executive order to close.
5. Each of the Company (in respect of itself) and the Guarantor (in
respect of itself and the Company) agrees with each of the Purchasers:
(a) To make no amendment or any supplement to the Offering Memorandum
which shall be disapproved by you promptly after reasonable notice thereof; and
to furnish the Purchasers with copies thereof;
(b) Promptly from time to time to take such action as you may reasonably
request to qualify the Securities for offering and sale under the securities
laws of such jurisdictions as you may request and to comply with such laws so
as to permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the distribution of
the Securities, provided that in connection therewith neither the Company nor
the Guarantor shall be required to qualify as a foreign corporation or to file
a general consent to service of process in any jurisdiction;
(c) To furnish the Purchasers with ten copies of the Offering Memorandum
and each amendment or supplement thereto signed by an authorized officer of the
Company and the Guarantor with the independent accountants' reports included or
incorporated by reference in the Offering Memorandum, and any amendment or
supplement containing amendments to the financial statements covered by such
report(s), signed by the accountants, and to furnish additional written and
electronic copies thereof in such quantities as you may from time to time
reasonably request, and if, at any time prior to the expiration of nine months
after the date of the Offering Memorandum, any event shall have occurred as a
result of which the Offering Memorandum 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 when such Offering Memorandum is
delivered, not misleading, or, if for any other reason it shall be necessary or
desirable during such same period to amend or supplement the Offering
Memorandum, to notify you and upon your request to prepare and furnish without
charge to each Purchaser and to any dealer in securities as many written and
electronic copies as you may from time to time reasonably request of an amended
Offering Memorandum or a supplement to the Offering Memorandum which will
correct such statement or omission or effect such compliance;
(d) During the period beginning from the date hereof and continuing to and
including the Time of Delivery, not to offer, sell, contract to sell or
otherwise dispose of any debt securities of the Company which mature more than
one year after the Time of Delivery and which are substantially similar to the
Securities, without your prior written consent;
(e) Not to be or become, at any time prior to the expiration of two years
after the Time of Delivery, an open-end investment company required to be
registered under Section 8 of the Investment Company Act;
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(f) At any time when the Company is not subject to Section 13 or 15(d) of
the Exchange Act, for the benefit of holders from time to time of the
Securities, to furnish at its expense, upon request, to holders of the
Securities and prospective purchasers of securities information (the
"Additional Issuer Information") satisfying the requirements of subsection
(d)(4)(i) of Rule 144A under the Act;
(g) If requested by you, to use its best efforts to cause the Securities
to be eligible for the PORTAL trading system of the National Association of
Securities Dealers, Inc.;
(h) During the period of two years after the Time of Delivery, the
Guarantor and the Company will not, and will not permit any of their
"affiliates" (as defined in Rule 144 under the Act) to, resell any of the
Securities which constitute "restricted securities" under Rule 144 that have
been reacquired by any of them;
(l) The Company and the Guarantor shall enter into an Exchange and
Registration Rights Agreement with the Purchasers pursuant to which the Company
and the Guarantor shall agree to file and use its best efforts to cause to be
declared or become effective under the Act, on or prior to 180 days after the
Time of Delivery, a registration statement on Form S-4 providing for the
registration of another series of debt securities of the Company, with terms
identical to the Securities (the "Exchange Securities"), and the exchange of
the Securities for the Exchange Securities, all in a manner which will permit
persons who acquire the Exchange Securities to resell the Exchange Securities
pursuant to Section 4(1) of the Act.
(m) To use the net proceeds received by it from the sale of the Securities
pursuant to this Agreement in the manner specified in the Offering Memorandum
under the caption "Use of Proceeds".
6. The Company and the Guarantor covenant and agree with the several
Purchasers that the Company or the Guarantor will pay or cause to be paid the
following: (i) the fees, disbursements and expenses of the Company's and the
Guarantor's counsel and accountants in connection with the issue and listing of
the Securities, the preparation and delivery of the Securities, and the
preparation, printing and filing of the Offering Memorandum and any amendments
and supplements thereto and the mailing and delivering of copies thereof to the
Purchasers and dealers; (ii) the cost of printing or producing any Agreement
among Purchasers, this Agreement, the Indenture, any Blue Sky and legal
investment surveys, closing documents (including any compilations thereof) and
any other documents in connection with the offering, purchase, sale and
delivery of the Securities; (iii) all expenses in connection with the
qualification of the Securities for offering and sale under state securities
laws as provided in Section 5(b) hereof, including the fees and disbursements
of counsel for the Purchasers in connection with such qualification and in
connection with the Blue Sky and legal investment surveys; (iv) any fees
charged by securities rating services for rating the Securities; (v) the cost
of preparing the Securities; (vi) the fees and expenses of the Trustee and any
agent of the Trustee and the fees and disbursements of counsel for the Trustee
in connection with the Indenture and the Securities; and (vi) all other costs
and expenses incident to the performance of the Company's and the Guarantor's
obligations hereunder which are not otherwise specifically provided for in this
Section. It is understood, however, that, except as provided in this Section,
and Sections 8 and 11 hereof, the Purchasers will pay all of their own costs
and expenses, including the fees of their counsel, transfer taxes on resale of
any of the Securities by them, and any advertising expenses connected with any
offers they may make.
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7. The obligations of the Purchasers hereunder shall be subject, in their
discretion, to the condition that all representations and warranties and other
statements of the Company and the Guarantor herein are, at and as of the Time
of Delivery, true and correct, the condition that each of the Company and the
Guarantor shall have performed all of its respective obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) Xxxxxxxx & Xxxxxxxx, counsel for the Purchasers, shall have furnished
to you such opinion or opinions, dated the Time of Delivery, with respect to
the matters covered in paragraphs (i), (vi), (vii), (viii), (xii), (xiv) and
(xv) of subsection (b) below as well as such other related matters as you may
reasonably request, and such counsel shall have received such papers and
information as they may reasonably request to enable them to pass upon such
matters. In rendering such opinion or opinions, Xxxxxxxx & Xxxxxxxx may rely as
to all matters governed by Pennsylvania law upon the opinion referred to in
subsection (b) of this Section 7;
(b) Xxxxxxxx X. Xxxxx, Vice President - Legal Affairs of the Guarantor, or
an Assistant General Counsel of the Guarantor, shall have furnished to you his
written opinion, dated the Time of Delivery, in form and substance satisfactory
to you, to the effect that:
(i) Each of the Company and the Guarantor has been duly incorporated
and is validly existing as a corporation in good standing under the laws
of its jurisdiction of incorporation, with power and authority (corporate
and other) to own its properties and conduct its business as described in
the Offering Memorandum;
(ii) Each of the Company and the Guarantor has an authorized
capitalization as set forth in the Offering Memorandum, and all of the
issued shares of capital stock of the Company and the Guarantor have been
duly and validly authorized and issued and are fully paid and
non-assessable;
(iii) Each of the Company and the Guarantor has been duly qualified
as a foreign corporation for the transaction of business and is in good
standing under the laws of each other jurisdiction in which it owns or
leases properties or conducts any business so as to require such
qualification, except as failure to qualify would not have a material
adverse effect on the Guarantor and its subsidiaries (including the
Company) taken as a whole;
(iv) Each other Principal Subsidiary has been duly organized and is
validly existing in good standing under the laws of its jurisdiction of
organization; and all of the issued shares of capital stock or partnership
interests, as the case may be, of each such Principal Subsidiary have been
duly and validly authorized and issued, are fully paid and non-assessable,
and (except for directors' qualifying shares and except as otherwise set
forth in the Offering Memorandum) are owned directly or indirectly by the
Guarantor;
(v) To the best of such counsel's knowledge and other than as set
forth in the Offering Memorandum, there are no legal or governmental
proceedings pending to which the Company or the Guarantor or any of its
subsidiaries is a party or of which any property of the Company or the
Guarantor or any of its subsidiaries is the subject which, if determined
adversely, would have a material adverse effect on the consolidated
financial position, stockholders' equity or results of operations of the
Company or the Guarantor and its subsidiaries taken as a whole;
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and, to the best of such counsel's knowledge, no such proceedings have
been overtly threatened;
(vi) This Agreement has been duly authorized, executed and delivered
by the Company and the Guarantor;
(vii) The Guarantees have been duly authorized, executed and
delivered by the Guarantor and constitute valid and legally binding
obligations of the Guarantor entitled to the benefits provided by the
Indenture; the Notes, including the temporary global Notes offered and
sold in offshore transactions in reliance on Regulation S, have been duly
authorized, executed, authenticated, issued and delivered by the Company
and constitute valid and legally binding obligations of the Company
entitled to the benefits provided by the Indenture; the permanent global
Notes have been duly authorized, and when executed, authenticated, issued
and delivered in exchange for the temporary global Notes, in accordance
with the terms of the Indenture, will have been duly executed,
authenticated, issued and delivered by the Company and will constitute
valid and legally binding obligations of the Company entitled to the
benefits provided by the Indenture; and the Securities and the Indenture
conform, and will conform, as the case may be, to the descriptions thereof
in the Offering Memorandum;
(viii)The Indenture has been duly authorized, executed and delivered
by the parties thereto and constitutes a valid and legally binding
instrument, enforceable in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and other laws of
general applicability relating to or affecting creditors' rights and to
general equity principles;
(ix) The issue and sale of the Securities and the compliance by the
Company and the Guarantor with all of the provisions of the Securities,
the Indenture and this Agreement, and the consummation of the transactions
herein and therein contemplated, will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument known to such counsel to which the Guarantor
or the Company is a party or by which the Guarantor or the Company is
bound or to which any of the property or assets of the Company or the
Guarantor is subject, nor will such actions result in any violation of the
provisions of the Certificate of Incorporation or By-laws of the Guarantor
or the Company or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over the
Guarantor or the Company or any of their properties;
(x) No consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required for the issue and sale of the Securities or the consummation by
the Company and the Guarantor of the transactions contemplated by this
Agreement or the Indenture, except such consents, approvals,
authorizations, registrations or qualifications as may be required under
state securities or Blue Sky laws in connection with the purchase and
distribution of the Securities by the Purchasers;
(xi) Neither the Guarantor, the Company nor any of the other
Principal Subsidiaries is in violation of its Certificate of Incorporation
(or Partnership Agreement, as the case may be) or By-laws or in default in
the performance or observance of any material obligation, covenant or
condition contained in any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which it is a party
or by which it or any of its properties may
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be bound which would have a material adverse effect on the Guarantor and
its subsidiaries (including the Company) taken as a whole;
(xii) The statements set forth in the Offering Memorandum under the
caption "Description of Notes", insofar as they purport to constitute a
summary of the terms of the Securities, are complete and accurate in all
material respects;
(xiii) The Exchange Act Reports (other than the financial statements
and related schedules therein, as to which such counsel need express no
opinion), when they were filed with the Commission, complied as to form in
all material respects with the requirements of the Exchange Act, and the
rules and regulations of the Commission thereunder; and such counsel has
no reason to believe that any of such documents, when they were so filed,
contained an untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made when such documents
were so filed, not misleading;
(xiv) No registration of the Securities under the Act, and no
qualification of an indenture under the Trust Indenture Act of 1939 with
respect thereto, is required for the offer, sale and initial resale of the
Securities by the Purchasers in the manner contemplated by this Agreement,
including Annex I hereto, and the Offering Memorandum;
(xv) Although such counsel does not assume any responsibility for the
completeness or accuracy of the statements contained in the Offering
Memorandum, except for those referred to in subsection (xii) of this
Section 7(b), such counsel has no reason to believe that the Offering
Memorandum and any further amendments or supplements thereto made by the
Company or the Guarantor prior to the Time of Delivery (other than the
financial statements and related schedules therein, as to which such
counsel need express no opinion) contained as of its date or contains as
of the Time of Delivery an untrue statement of a material fact or omitted
or omits, as the case may be, to state a material fact necessary to make
the statements therein, in the light of the circumstances under which they
were made, not misleading; and
(xvi) Neither the Company nor the Guarantor is an "investment
company", as such term is defined in the Investment Company Act.
In rendering such opinion or opinions, Mr. Xxxxx or such Assistant General
Counsel of the Guarantor may rely as to all matters governed by the law of the
State of New York upon the opinion of Xxxxxxxx & Xxxxxxxx referred to in
subsection (a) of this Section 7.
(c) On the date of the Offering Memorandum prior to the execution of this
Agreement and also at the Time of Delivery, PricewaterhouseCoopers LLP shall
have furnished to you, in your role as Underwriters of the Securities, a letter
or letters, dated the respective dates of delivery thereof, in form and
substance satisfactory to you, as to such matters as you may reasonably
request.
(d) (i) None of the Company and its subsidiaries, nor the Guarantor and
its subsidiaries (including the Company) shall have sustained, since the date
of the latest audited financial statements of the Guarantor incorporated by
reference in the Offering Memorandum, any loss or interference with its
business, otherwise than as set forth or contemplated in the Offering
10
Memorandum, and (ii) since the respective dates as of which information is
given in the Offering Memorandum, there shall not have been any change in the
capital stock or long-term debt of the Guarantor and its subsidiaries
(including the Company), or of the Company and its subsidiaries, or any change,
or any development that is reasonably likely to cause a prospective change, in
or affecting the general affairs, management, financial position, stockholders'
equity or results of operations of the Guarantor and its subsidiaries
(including the Company) taken as a whole, or of the Company and its
subsidiaries, taken as a whole, otherwise than as set forth or contemplated in
the Offering Memorandum, the effect of which, in any such case described in
clause (i) or (ii), is in your judgment so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Securities on the terms and in the manner contemplated in this
Agreement and in the Offering Memorandum;
(e) On or after the date hereof (i) no downgrading shall have occurred in
the rating accorded the debt securities of, or guaranteed by, the Guarantor by
any "nationally recognized statistical rating organization", as that term is
defined by the Commission for purposes of Rule 436(g)(2) under the Act, and
(ii) no such organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating of any
of the debt securities of, or guaranteed by, the Guarantor;
(f) On or after the date hereof there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in securities
generally on the New York Stock Exchange; (ii) a suspension or material
limitation in trading in the Guarantor's common stock on the New York Stock
Exchange; (iii) a general moratorium on commercial banking activities declared
by either Federal or New York State authorities or a material disruption of
commercial banking or securities settlement or clearance services in the United
States; or (iv) the outbreak or escalation of hostilities involving the United
States or the declaration by the United States of a national emergency or war,
if the effect of any such event specified in this clause (iv) in your judgment
makes it impracticable or inadvisable to proceed with the public offering or
the delivery of the Securities on the terms and in the manner contemplated in
the Offering Memorandum;
(g) Each of the Guarantor and the Company shall have furnished or caused
to be furnished to you at the Time of Delivery certificates of officers of the
Guarantor and the Company satisfactory to you as to the accuracy of the
representations and warranties of the Guarantor and the Company herein at and
as of such Time of Delivery, as to the performance by the Guarantor and the
Company of all of its obligations hereunder to be performed at or prior to such
Time of Delivery, as to the matters set forth in subsection (d) of this Section
and as to such other matters as you may reasonably request.
8. (a) The Guarantor (in respect of itself and the Company) and the
Company (in respect of itself) will indemnify and hold harmless each Purchaser
against any losses, claims, damages or liabilities, joint or several, to which
such Purchaser may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in the Offering Memorandum, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact necessary to make the statements
therein in light of the circumstances under which they were made, not
misleading, and will reimburse each Purchaser for any legal or other expenses
reasonably incurred by such Purchaser in connection with investigating or
defending any such action or claim as such expenses are incurred; provided,
11
however, that neither the Company nor the 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 or omission or
alleged omission made in the Offering Memorandum or any such amendment or
supplement in reliance upon and in conformity with written information
furnished to the Company and/or the Guarantor by any Purchaser through you
expressly for use therein.
(b) Each Purchaser, severally and not jointly, will indemnify and hold
harmless each of the Company and the Guarantor against any losses, claims,
damages or liabilities to which the Company or the Guarantor may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in
the Offering Memorandum, or any amendment or supplement thereto, or arise out
of or are based upon the omission or alleged omission to state therein a
material fact necessary to make the statements therein in 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 the Offering Memorandum
or any such amendment or supplement in reliance upon and in conformity with
written information furnished to the Company or the Guarantor by such Purchaser
through you expressly for use therein; and will reimburse the Company and the
Guarantor for any legal or other expenses reasonably incurred by the Company or
the Guarantor in connection with investigating or defending any such action or
claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a) or
(b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party
shall not relieve it from any liability which it may have to any indemnified
party otherwise than under such subsection. In case any such action shall be
brought against any indemnified party and it shall notify the indemnifying
party of the commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall 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 shall not be
liable to such indemnified party under such subsection for any legal expenses
of other counsel or any other expenses, in each case subsequently incurred by
such indemnified party, in connection with the defense thereof other than
reasonable costs of investigation. No indemnifying party shall, without the
written consent of the indemnified party, effect the settlement or compromise
of, or consent to the entry of any judgment with respect to, any pending or
threatened action or claim in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified party is an actual or
potential party to such action or claim) unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from
all liability arising out of such action or claim and (ii) does not include a
statement as to, or an admission of, fault, culpability or a failure to act, by
or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 8 is unavailable
to or insufficient to hold harmless an indemnified party under subsection (a)
or (b) above in respect of any losses, claims, damages or liabilities (or
actions in respect thereof) referred to therein, then each indemnifying party
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses,
12
claims, damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative benefits received by the
Company and the Guarantor on the one hand and the Purchasers on the other from
the offering of the Securities. If, however, the allocation provided by the
immediately preceding sentence is not permitted by applicable law or if the
indemnified party failed to give the notice required under subsection (c)
above, then each indemnifying party shall contribute to such amount paid or
payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company or the Guarantor on the one hand and the Purchasers on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. The relative benefits received by the
Company and the Guarantor on the one hand and the 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 Guarantor
bear to the total underwriting discounts and commissions received by the
Purchasers, in each case as set forth in the Offering Memorandum. 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 or the Guarantor on the one hand or the Purchasers on the other and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. The Company, the Guarantor
and the Purchasers agree that it would not be just and equitable if
contribution pursuant to this subsection (d) were determined by pro rata
allocation (even if the Purchasers were treated as one entity for such purpose)
or by any other method of allocation which does not take account of the
equitable considerations referred to above in this subsection (d). The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages or liabilities (or actions in respect thereof) referred to above in
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 such action or claim. Notwithstanding the provisions of this
subsection (d), no Purchaser shall be required to contribute any amount in
excess of the amount by which the total price at which the Securities
underwritten by it and distributed to investors were offered to investors
exceeds the amount of any damages which such Purchaser has otherwise been
required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. The Purchasers' obligations in this subsection
(d) to contribute are several in proportion to their respective underwriting
obligations and not joint. No party guilty of fraudulent misrepresentation
shall be entitled to contribution by any person who was not guilty of
fraudulent misrepresentation.
(e) The obligations of the Company and the Guarantor under this Section 8
shall be in addition to any liability which the Company or the Guarantor may
otherwise have and shall extend, upon the same terms and conditions, to each
person, if any, who controls any Purchaser within the meaning of the Act; and
the obligations of the Purchasers under this Section 8 shall be in addition to
any liability which the respective Purchasers may otherwise have and shall
extend, upon the same terms and conditions, to each officer and director of the
Company and the Guarantor and to each person, if any, who controls the Company
or the Guarantor within the meaning of the Act.
9. (a) If any Purchaser shall default in its obligation to purchase the
Securities which it has agreed to purchase hereunder, you may in your
discretion arrange for you or another party or other parties to purchase such
Securities on the terms contained herein. If within thirty-six hours after such
default by any Purchaser you do not arrange for the purchase of such
Securities, then the Company shall be entitled to a further period of
thirty-six hours within which to procure another party or other
13
parties satisfactory to you to purchase such Securities on such terms. In the
event that, within the respective prescribed periods, you notify the Company
that you have so arranged for the purchase of such Securities, or the Company
notifies you that it has so arranged for the purchase of such Securities, you
or the Company shall have the right to postpone the Time of Delivery for a
period of not more than seven days, in order to effect whatever changes may
thereby be made necessary in the Offering Memorandum, or in any other documents
or arrangements, and the Company agrees to prepare promptly any amendments to
the Offering Memorandum which in your opinion may thereby be made necessary.
The term "Purchaser" as used in this Agreement shall include any person
substituted under this Section with like effect as if such person had
originally been a party to this Agreement with respect to such Securities.
(b) If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Purchaser or Purchasers by the non-defaulting
Purchasers and the Company as provided in subsection (a) above, the aggregate
principal amount of such Securities which remains unpurchased does not exceed
one-eleventh of the aggregate principal amount of all the Securities, then the
Company shall have the right to require each non-defaulting Purchaser to
purchase the principal amount of Securities which such Purchaser agreed to
purchase hereunder and, in addition, to require each non-defaulting Purchaser
to purchase its pro rata share (based on the principal amount of Securities
which such Purchaser agreed to purchase hereunder) of the Securities of such
defaulting Purchaser or Purchasers for which such arrangements have not been
made; but nothing herein shall relieve a defaulting Purchaser from liability
for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Purchaser or Purchasers by you and the Company as
provided in subsection (a) above, the aggregate principal amount of Securities
which remains unpurchased exceeds one-eleventh of the aggregate principal
amount of all the Securities, or if the Company shall not exercise the right
described in subsection (b) above to require non-defaulting Purchasers to
purchase Securities of a defaulting Purchaser or Purchasers, then this
Agreement shall thereupon terminate, without liability on the part of any
non-defaulting Purchaser or the Company or the Guarantor, except for the
expenses to be borne by the Company, the Guarantor and the Purchasers as
provided in Section 6 hereof and the indemnity and contribution agreements in
Section 8 hereof; but nothing herein shall relieve a defaulting Purchaser from
liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company, the Guarantor and the several Purchasers,
as set forth in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall remain in full force and effect, regardless
of any investigation (or any statement as to the results thereof) made by or on
behalf of any Purchaser or any controlling person of any Purchaser, or the
Company or the Guarantor, or any officer or director or controlling person of
the Company or the Guarantor, and shall survive delivery of and payment for the
Securities.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
neither the Company nor the Guarantor shall then be under any liability to any
Purchaser except as provided in Sections 6 and 8 hereof; but, if for any other
reason, the Securities are not delivered by or on behalf of the Company as
provided herein, the Company or the Guarantor will reimburse the Purchasers
through you for all out-of-pocket expenses approved in writing by you,
including fees and disbursements of counsel, reasonably incurred by the
Purchasers in making preparations for the purchase, sale and
14
delivery of the Securities, but neither the Company nor the Guarantor shall
then be under further liability to any Purchaser except as provided in Sections
6 and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Purchasers, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Purchaser made or
given by you.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Purchasers shall be delivered or sent by mail or
facsimile transmission to you as the representatives in care of X.X. Xxxxxx
Securities Inc., 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Transaction Execution Group; and if to the Company or the Guarantor shall be
delivered or sent by mail or facsimile transmission to the Company and the
Guarantor at 000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxxxxx, Xxxxxxxxxxxx 00000,
Attention: President (for the Company) and Treasurer (for the Guarantor);
provided, however, that any notice to a Purchaser pursuant to Section 8(c)
hereof shall be delivered or sent by mail or facsimile transmission to such
Purchaser at its address set forth in its Purchasers' Questionnaire, or telex
constituting such Questionnaire, which address will be supplied to the Company
or the Guarantor by you upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
13. This Agreement shall be binding upon, and inure solely to the benefit
of, the Purchasers, the Company, the Guarantor and, to the extent provided in
Sections 8 and 10 hereof, the officers and directors of the Company and the
Guarantor and each person who controls the Company or the Guarantor or any
Purchaser, and their respective heirs, executors, administrators, successors
and assigns, and no other person shall acquire or have any right under or by
virtue of this Agreement. No purchaser of any of the Securities from any
Purchaser shall be deemed a successor or assign by reason merely of such
purchase.
14. Time shall be of the essence of this Agreement.
15. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such respective counterparts shall together constitute one
and the same instrument.
15
If the foregoing is in accordance with your understanding, please sign and
return to us one for each of the Company and the Guarantor and each of the
Purchasers plus one for each counsel counterparts thereof, and upon the
acceptance hereof by you, on behalf of each of the Purchasers, this letter and
such acceptance hereof shall constitute a binding agreement between each of the
Purchasers and the Company and the Guarantor. It is understood that your
acceptance of this letter on behalf of each of the Purchasers is pursuant to
the authority set forth in a form of Agreement among Purchasers, the form of
which shall be submitted to the Company for examination upon request, but
without warranty on your part as to the authority of the signers thereof.
Very truly yours,
X.X. Xxxxx Finance Company
By: /s/ Xxxxxxx X. Xxxxx, Xx.
-----------------------------
Name: Xxxxxxx X. Xxxxx, Xx.
Title: President
Very truly yours,
X.X. Xxxxx Company
By: /s/ Xxxxxxx X. Xxxxx, Xx.
-----------------------------
Name: Xxxxxxx X. Xxxxx, Xx.
Title: Treasurer
Accepted as of the date hereof:
X.X.Xxxxxx Securities Inc.
By: /s/ Xxxxx Xxxxxx
---------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
On behalf of each of the Purchasers
16
SCHEDULE I
Principal
Amount of
Securities
to be
Purchaser Purchased
--------- ----------
X. X. Xxxxxx Securities Inc....................................... $175,000,000
UBS Warburg LLC................................................... $175,000,000
HSBC Securities (USA) Inc. ....................................... $175,000,000
Banc of America Securities LLC.................................... $35,000,000
Xxxxxxx, Xxxxx & Co. ............................................. $35,000,000
Xxxxxx Brothers Inc............................................... $35,000,000
ABN AMRO Incorporated............................................. $14,000,000
Banc One Capital Markets Inc...................................... $14,000,000
BNP Paribas Securities Corp....................................... $14,000,000
Mizuho International plc.......................................... $7,000,000
NatCity Investments, Inc.......................................... $7,000,000
Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A.,
"Rabobank International," London Branch........................... $7,000,000
XX Xxxxx Securities Corporation................................... $7,000,000
------------
$700,000,000
============
17
ANNEX I
(1) The Securities have not been and will not be registered under the 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
under the Act or pursuant to an exemption from the registration requirements of
the Act. Each Purchaser represents that it has offered and sold the Securities,
and will offer and sell the Securities (i) as part of their distribution at any
time and (ii) otherwise until 40 days after the later of the commencement of
the offering and the Time of Delivery, only in accordance with Rule 903 of
Regulation S or Rule 144A under the Act. Accordingly, each Purchaser agrees
that neither it, its affiliates nor any persons acting on its or their behalf
has engaged or will engage in any directed selling efforts with respect to the
Securities, and it and they have complied and will comply with the offering
restrictions requirement of Regulation S. Each Purchaser agrees that, at or
prior to confirmation of sale of Securities (other than a sale pursuant to Rule
144A) it will have sent to each distributor, dealer or person receiving a
selling concession, fee or other remuneration that purchases Securities from it
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 "Act") and may not be offered and sold
within the United States or to, or for the account or benefit of, U.S.
persons (i) as part of their distribution at any time or (ii) otherwise
until 40 days after the later 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 Act. Terms used above have the meaning
given to them by Regulation S."
Terms used in this paragraph have the meanings given to them by Regulation S.
Each Purchaser further agrees that it has not entered and will not enter
into any contractual arrangement with respect to the distribution or delivery
of the Securities, except with its affiliates or with the prior written consent
of the Company.
(2) Notwithstanding the foregoing, Securities in registered form may be
offered, sold and delivered by the Purchasers in the United States and to U.S.
persons pursuant to Section 3 of this Agreement without delivery of the written
statement required by paragraph (1) above.
(3) Each Purchaser further represents and agrees that: (i) it has not
offered or sold and, prior to the date that is six months after the date of
issue of the Securities, will not offer or sell any Securities to persons in
the United Kingdom except to persons whose ordinary activities involve them in
acquiring, holding, managing or disposing of investments (as principal or
agent) for the purposes of their businesses or otherwise in circumstances which
have not resulted and will not result in an offer to the public in the United
Kingdom within the meaning of the Public Offers of Securities Regulations 1995;
(ii) it has complied, and will comply, with all applicable provisions of the
Financial Services and Markets Act 2000 (the "FSMA") with respect to anything
done by it in relation to the Securities in, from or otherwise involving the
United Kingdom; and (iii) it has only communicated or caused to be
communicated, and will only communicate or cause to be communicated, any
invitation or inducement to engage in investment activity (within the meaning
of section 21 of the FSMA) received by it in connection with the issue or sale
of any Securities in circumstances in which section 21(1) of the FSMA does not
apply to the Company or the Guarantor.
F-1
(4) Each Purchaser agrees that it will not offer, sell or deliver any of
the Securities in any jurisdiction outside the United States except under
circumstances that will result in compliance with the applicable laws thereof,
and that it will take at its own expense whatever action is required to permit
its purchase and resale of the Securities in such jurisdictions. Each Purchaser
understands that no action has been taken to permit a public offering in any
jurisdiction outside the United States where action would be required for such
purpose. Each Purchaser agrees not to cause any advertisement of the Securities
to be published in any newspaper or periodical or posted in any public place
and not to issue any circular relating to the Securities, except in any such
case with X.X. Xxxxxx Securities Inc.'s express written consent and then only
at its own risk and expense.
F-2
