EXHIBIT 99.4
$125,000,000
XXXXXX CORPORATION
3.5% Convertible Debentures Due 2022
PURCHASE AGREEMENT
August 20, 2002
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxx Xxxxx Barney Inc.
SunTrust Capital Markets, Inc.
Wachovia Securities, Inc.
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs and Mesdames:
Xxxxxx Corporation, a Delaware corporation (the "COMPANY"), proposes to
issue and sell to the several purchasers named in Schedule I hereto (the
"INITIAL PURCHASERS") $125,000,000 principal amount of its 3.5% Convertible
Debentures Due 2022 (the "FIRM SECURITIES") to be issued pursuant to the
provisions of an Indenture to be dated as of August 26, 2002 (the "Indenture")
between the Company and The Bank of New York, as Trustee (the "TRUSTEE"). The
Company also proposes to issue and sell to the Initial Purchasers not more than
an additional $25,000,000 principal amount of its 3.5% Convertible Debentures
Due 2022 (the "ADDITIONAL SECURITIES") if and to the extent that you, as
Managers of the offering, shall have determined to exercise, on behalf of the
Initial Purchasers, the right to purchase such 3.5% Convertible Debentures Due
2022 granted to the Initial Purchasers in Section 2 hereof. The Firm Securities
and the Additional Securities are hereinafter collectively referred to as the
"SECURITIES". The Securities will be convertible into shares of Common Stock,
par value $1.00 (the "UNDERLYING SECURITIES"), of the Company.
The Securities and the Underlying Securities will be offered without being
registered under the Securities Act of 1933, as amended (the "SECURITIES ACT"),
in reliance upon exemptions from the registration requirements of the Securities
Act.
The Initial Purchasers and their direct and indirect transferees will be
entitled to the benefits of a Registration Rights Agreement dated the date
hereof between the Company and the Initial Purchasers (the "REGISTRATION RIGHTS
AGREEMENT").
In connection with the sale of the Securities, the Company will prepare a
final offering memorandum (the "MEMORANDUM") including or incorporating by
reference a description of the terms of the Securities and the Underlying
Securities, the terms of the offering and a description of the Company. As used
herein, the term "Memorandum" shall include in each case the documents
incorporated by reference therein.
1. Representations and Warranties. The Company represents and warrants to,
and agrees with, you that:
(a) (i) Each document, if any, filed or to be filed pursuant to the
Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT") and
incorporated by reference
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in the Memorandum complied or will comply when so filed in all material
respects with the Exchange Act and the applicable rules and regulations of
the Securities and Exchange Commission (the "COMMISSION") thereunder and
(ii) the Memorandum, in the form used by the Initial Purchasers to confirm
sales and on the Closing Date (as defined in Section 4), will not contain
any untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except that the
representations and warranties set forth in this paragraph do not apply to
statements or omissions in the Memorandum based upon information relating
to any Initial Purchaser furnished to the Company in writing by such
Initial Purchaser through you expressly for use therein.
(b) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its property
and to conduct its business as described in the Memorandum and is duly
qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries, taken as a
whole.
(c) On the date hereof, the Company has no significant subsidiary,
as defined in Rule 405 under the Securities Act.
(d) This Agreement has been duly authorized, executed and delivered
by the Company.
(e) The authorized capital stock of the Company is as set forth in
the Memorandum and conforms as to legal matters to the description thereof
contained in the Memorandum.
(f) The shares of common stock outstanding prior to the issuance of
the Securities have been duly authorized and are validly issued, fully
paid and non-assessable.
(g) The Securities have been duly authorized and, when executed and
authenticated in accordance with the provisions of the Indenture and
delivered to and paid for by the Initial Purchasers in accordance with the
terms of this Agreement, will be valid and binding obligations of the
Company, enforceable in accordance with their terms, subject to the
effects of applicable bankruptcy, insolvency and similar laws affecting
creditors' rights generally and equitable principles of general
applicability, and will be entitled to the benefits of the Indenture and
the Registration Rights Agreement.
(h) The Underlying Securities issuable upon conversion of the
Securities have been duly authorized and reserved and, when issued upon
conversion of the Securities in accordance with the terms of the
Securities, will be validly issued, fully paid and
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non-assessable, and the issuance of the Underlying Securities will not be
subject to any preemptive or similar rights.
(i) Each of the Indenture and the Registration Rights Agreement have
been duly authorized, executed and delivered by, and is a valid and
binding agreement of, the Company, enforceable in accordance with its
terms, subject to applicable bankruptcy, insolvency or similar laws
affecting creditors' rights generally and general principles of equity and
except as rights to indemnification and contribution under the
Registration Rights Agreement may be limited under applicable law.
(j) The execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement, the
Indenture, the Registration Rights Agreement and the Securities will not
contravene any provision of applicable law or the certificate of
incorporation or by-laws of the Company or any agreement or other
instrument binding upon the Company or any of its subsidiaries that is
material to the Company and its subsidiaries, taken as a whole, or any
judgment, order or decree of any governmental body, agency or court having
jurisdiction over the Company or any subsidiary, and no consent, approval,
authorization or order of, or qualification with, any governmental body or
agency is required for the performance by the Company of its obligations
under this Agreement, the Indenture, the Registration Rights Agreement or
the Securities, except such as may be required by the securities or Blue
Sky laws of the various states in connection with the offer and sale of
the Securities and by Federal and state securities laws with respect to
the Company's obligations under the Registration Rights Agreement.
(k) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a whole, from
that set forth in the Memorandum, exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement.
(l) There are no legal or governmental proceedings pending or
threatened to which the Company or any of its subsidiaries is a party or
to which any of the properties of the Company or any of its subsidiaries
is subject other than proceedings accurately described in all material
respects in the Memorandum and proceedings that would not have a material
adverse effect on the Company and its subsidiaries, taken as a whole, or
on the power or ability of the Company to perform its obligations under
this Agreement, the Indenture, the Registration Rights Agreement or the
Securities or to consummate the transactions contemplated by the
Memorandum.
(m) The Company and its subsidiaries (i) are in compliance with any
and all applicable foreign, Federal, state and local laws and regulations
relating to the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
("ENVIRONMENTAL LAWS"), (ii) have received all permits, licenses or other
approvals required of them under applicable Environmental Laws to conduct
their respective businesses and (iii) are in compliance with all terms and
conditions of any such permit, license or approval, except where such
noncompliance
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with Environmental Laws, failure to receive required permits, licenses or
other approvals or failure to comply with the terms and conditions of such
permits, licenses or approvals would not, singly or in the aggregate, have
a material adverse effect on the Company and its subsidiaries, taken as a
whole.
(n) There are no costs or liabilities associated with Environmental
Laws (including, without limitation, any capital or operating expenditures
required for clean-up, closure of properties or compliance with
Environmental Laws or any permit, license or approval, any related
constraints on operating activities and any potential liabilities to third
parties) which would, singly or in the aggregate, have a material adverse
effect on the Company and its subsidiaries, taken as a whole.
(o) The Company is not, and after giving effect to the offering and
sale of the Securities and the application of the proceeds thereof as
described in the Memorandum will not be, required to register as an
"investment company" as such term is defined in the Investment Company Act
of 1940, as amended.
(p) Neither the Company nor any affiliate (as defined in Rule 501(b)
of Regulation D under the Securities Act, an "AFFILIATE") of the Company
has directly, or through any agent, (i) sold, offered for sale, solicited
offers to buy or otherwise negotiated in respect of, any security (as
defined in the Securities Act) which is or will be integrated with the
sale of the Securities in a manner that would require the registration
under the Securities Act of the Securities or (ii) offered, solicited
offers to buy or sold the Securities by any form of general solicitation
or general advertising (as those terms are used in Regulation D under the
Securities Act) or in any manner involving a public offering within the
meaning of Section 4(2) of the Securities Act in connection with any offer
or sale of the Securities in the United States, except no representation,
warranty or agreement is made by the Company in this paragraph with
respect to the Initial Purchasers.
(q) None of the Company, its Affiliates or any person acting on its
or their behalf has engaged or will engage in any directed selling efforts
(within the meaning of Regulation S under the Securities Act ("REGULATION
S")) with respect to the Securities being sold in reliance on Regulation S
and the Company and its Affiliates and any person acting on its or their
behalf have complied and will comply with the offering restrictions
requirement of Regulation S, except no representation, warranty or
agreement is made by the Company in this paragraph with respect to the
Initial Purchasers.
(r) It is not necessary in connection with the offer, sale and
delivery of the Securities to the Initial Purchasers in the manner
contemplated by this Agreement to register the Securities under the
Securities Act or to qualify the Indenture under the Trust Indenture Act
of 1939, as amended.
(s) The Securities satisfy the requirements set forth in Rule
144A(d)(3) under the Securities Act.
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(t) None of the Company and its subsidiaries or, to the best
knowledge of the Company, any director, officer, agent, employee or other
person associated with or acting on behalf of the Company or any
subsidiary has (A) within the past five years violated or is in violation
of any provision of the Foreign Corrupt Practices Act of 1977 or (B) (i)
used any corporate funds for any unlawful contribution, gift,
entertainment or other unlawful expense relating to political activity,
(ii) made any direct or indirect unlawful payment to any foreign or
domestic government official or employee from corporate funds or (iii)
made any bribe, rebate, payoff, influence payment, kickback or other
unlawful payment, except in the case of clauses (B)(i), (B)(ii) and
(B)(iii), which would not, singly or in the aggregate, have a material
adverse effect on the Company and its subsidiaries, taken as a whole.
2. Agreements to Sell and Purchase. The Company hereby agrees to sell to
the several Initial Purchasers, and each Initial Purchaser, upon the basis of
the representations and warranties herein contained, but subject to the
conditions hereinafter stated, agrees, severally and not jointly, to purchase
from the Company the respective principal amount of Firm Securities set forth in
Schedule I hereto opposite its name at a purchase price of 97.5% of the
principal amount thereof (the "PURCHASE PRICE") plus accrued interest, if any,
from August 26, 2002 to the Closing Date.
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees to sell
to the Initial Purchasers the Additional Securities, and the Initial Purchasers
shall have a one-time right to purchase, severally and not jointly, up to
$25,000,000 principal amount of Additional Securities at the Purchase Price plus
accrued interest, if any, from August 26, 2002 to the date of payment and
delivery. If you, on behalf of the Initial Purchasers, elect to exercise such
option, you shall so notify the Company in writing not later than 30 calendar
days after the date of this Agreement, which notice shall specify the principal
amount of Additional Securities to be purchased by the Initial Purchasers and
the date on which such Additional Securities are to be purchased. Such date may
be the same as the Closing Date but not earlier than the Closing Date nor later
than ten business days after the date of such notice. If any Additional
Securities are to be purchased, each Initial Purchaser agrees, severally and not
jointly, to purchase the principal amount of Additional Securities (subject to
such adjustments to eliminate fractional Securities as you may determine) that
bears the same proportion to the total principal amount of Additional Securities
to be purchased as the principal amount of Firm Securities set forth in Schedule
I opposite the name of such Initial Purchaser bears to the total principal
amount of Firm Securities.
The Company hereby agrees that, without the prior written consent of
Xxxxxx Xxxxxxx & Co. Incorporated and Xxxxxxx Xxxxx Barney Inc. on behalf of the
Initial Purchasers, it will not, during the period ending 90 days after the date
of the Memorandum, (i) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant to purchase, lend, or otherwise transfer or dispose of,
directly or indirectly, any shares of common stock or any securities convertible
into or exercisable or exchangeable for common stock or (ii) enter into any swap
or other arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of the common stock, whether any such
transaction described in clause (i) or (ii) above is to be settled by delivery
of common stock or such other securities, in cash or otherwise. The foregoing
sentence
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shall not apply to (A) the sale of the Securities under this Agreement, (B) the
issuance by the Company of any shares of common stock upon the exercise of an
option or warrant or the conversion of a security outstanding on the date hereof
of which the Initial Purchasers have been advised in writing (it being agreed
that the Initial Purchasers shall be deemed to have been advised in writing of
all such options, warrants and securities identified as outstanding in the
Company's periodic reports filed pursuant to the Exchange Act prior to the date
hereof) or (C) the issuance by the Company under its existing employee benefit
plans disclosed in the Company's most recent Proxy Statement filed pursuant to
Section 14 under the Exchange Act or Annual Report on Form 10-K, in accordance
with past practice and the terms of such plans, of shares of common stock and
options to purchase common stock.
3. Terms of Offering. You have advised the Company that the Initial
Purchasers will make an offering of the Securities purchased by the Initial
Purchasers hereunder, on the terms to be set forth in the Memorandum, as soon as
practicable after this Agreement is entered into as in your judgment is
advisable.
4. Payment and Delivery. Payment for the Firm Securities shall be made to
the Company in Federal or other funds immediately available in New York City
against delivery of such Firm Securities for the respective accounts of the
several Initial Purchasers at 10:00 a.m., New York City time, on August 26,
2002, or at such other time on the same or such other date, not later than
August 30, 2002, as shall be designated in writing by you. The time and date of
such payment are hereinafter referred to as the "CLOSING Date."
Payment for any Additional Securities shall be made to the Company in
Federal or other funds immediately available in New York City against delivery
of such Additional Securities for the respective accounts of the several Initial
Purchasers at 10:00 a.m., New York City time, on the date specified in the
notice described in Section 2 or at such other time on the same or on such other
date, in any event not later than 10 calendar days after the date of such
notice, as shall be designated in writing by you. The time and date of such
payment are hereinafter referred to as the "OPTION CLOSING DATE."
Certificates for the Securities shall be in definitive form or global
form, as specified by you, and registered in such names and in such
denominations as you shall request in writing not later than one full business
day prior to the Closing Date or the Option Closing Date, as the case may be.
The certificates evidencing the Securities shall be delivered to you on the
Closing Date or the Option Closing Date, as the case may be, for the respective
accounts of the several Initial Purchasers, with any transfer taxes payable in
connection with the transfer of the Securities to the Initial Purchasers duly
paid, against payment of the Purchase Price therefor plus accrued interest, if
any, from August 26, 2002 to the date of payment and delivery.
5. Conditions to the Initial Purchasers' Obligations. The several
obligations of the Initial Purchasers to purchase and pay for the Firm
Securities on the Closing Date are subject to the following conditions:
(a) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date:
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(i) there shall not have occurred any downgrading, nor shall
any notice have been given of any intended or potential downgrading
or of any review for a possible change that does not indicate the
direction of the possible change, in the rating accorded the Company
or any of the Company's securities or in the rating outlook for the
Company by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule
436(g)(2) under the Securities Act; and
(ii) there shall not have occurred any change, or any
development involving a prospective change, in the condition,
financial or otherwise, or in the earnings, business or operations
of the Company and its subsidiaries, taken as a whole, from that set
forth in the Memorandum, exclusive of any amendments or supplements
thereto subsequent to the date of this Agreement that, in your
judgment, is material and adverse and that makes it, in your
judgment, impracticable or inadvisable to market, sell or deliver
the Securities on the terms and in the manner contemplated in the
Memorandum.
(b) The Initial Purchasers shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer of
the Company, to the effect set forth in Section 5(a)(i) and to the effect
that the representations and warranties of the Company contained in this
Agreement are true and correct as of the Closing Date and that the Company
has complied with all of the agreements and satisfied all of the
conditions on its part to be performed or satisfied hereunder on or before
the Closing Date.
The officer signing and delivering such certificate may rely upon
the best of his or her knowledge as to proceedings threatened.
(c) The Initial Purchasers shall have received on the Closing Date
an opinion of Holland & Knight LLP, outside counsel for the Company, dated
the Closing Date, to the effect set forth in Exhibit A-1 and an opinion of
Xxxxx X. Xxxxxx, Vice President-Counsel, Corporate and Commercial
Operations, of the Company, to the effect set forth in Exhibit A-2. Such
opinions shall be rendered to the Initial Purchasers at the request of the
Company and shall so state therein.
(d) The Initial Purchasers shall have received on the Closing Date
an opinion of Cravath, Swaine & Xxxxx, counsel for the Initial Purchasers,
dated the Closing Date, to the effect set forth in Exhibit B.
(e) The Initial Purchasers shall have received on each of the date
hereof and the Closing Date a letter, dated the date hereof or the Closing
Date, as the case may be, in form and substance satisfactory to the
Initial Purchasers, from Ernst & Young LLP, independent public
accountants, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to underwriters with respect to
the financial statements and certain financial information contained in or
incorporated by
7
reference into the Memorandum; provided that the letter delivered on the
Closing Date shall use a "cut-off date" not earlier than the date hereof.
(f) The "lock-up" agreements, each substantially in the form of
Exhibit C hereto, between you and the executive officers and directors of
the Company listed on Schedule II hereto relating to sales and certain
other dispositions of shares of common stock or certain other securities,
delivered to you on or before the date hereof, shall be in full force and
effect on the Closing Date.
(g) The Securities shall have been designated as Portal-eligible
securities in accordance with the rules and regulations of the NASD and
the Securities shall be eligible for clearance and settlement through The
Depository Trust Company.
(h) The shares of Common Stock issuable upon conversion of the
Securities shall have been duly listed, subject to notice of issuance, on
the New York Stock Exchange.
The several obligations of the Initial Purchasers to purchase Additional
Securities hereunder are subject to the delivery to you on the Option Closing
Date of such documents as you may reasonably request with respect to the good
standing of the Company, the due authorization, execution and authentication of
the Additional Securities and other matters related to the execution and
authentication of the Additional Securities.
6. Covenants of the Company. In further consideration of the agreements of
the Initial Purchasers contained in this Agreement, the Company covenants with
each Initial Purchaser as follows:
(a) To furnish to you in New York City, without charge, prior to
10:00 a.m. New York City time on the second business day next succeeding
the date of this Agreement and during the period mentioned in Section
6(c), as many copies of the Memorandum, any documents incorporated by
reference therein and any supplements and amendments thereto as you may
reasonably request.
(b) Before amending or supplementing the Memorandum, to furnish to
you a copy of each such proposed amendment or supplement and not to use
any such proposed amendment or supplement to which you reasonably object.
(c) If, during the period from the date hereof to the date on which
all of the Securities shall have been sold by the Initial Purchasers, any
event shall occur or condition exist as a result of which it is necessary
to amend or supplement the Memorandum in order to make the statements
therein, in the light of the circumstances when the Memorandum is
delivered to a purchaser, not misleading, or if, in the opinion of counsel
for the Initial Purchasers, it is necessary to amend or supplement the
Memorandum to comply with applicable law, forthwith to prepare and
furnish, at its own expense, to the Initial Purchasers, either amendments
or supplements to the Memorandum so that the statements in the Memorandum
as so amended or supplemented
8
will not, in the light of the circumstances when the Memorandum is
delivered to a purchaser, be misleading or so that the Memorandum, as
amended or supplemented, will comply with applicable law.
(d) To endeavor, if required by applicable law, to qualify the
Securities for offer and sale under the securities or Blue Sky laws of
such jurisdictions as you shall reasonably request; provided that the
Company will not be required to (i) qualify as a foreign corporation or as
a dealer in securities in any jurisdiction where it would not otherwise be
required to qualify but for this Agreement or (ii) take any action that
would subject it to general service of process in suits or to taxation in
any such jurisdiction where it is not then so subject.
(e) Whether or not the transactions contemplated in this Agreement
are consummated or this Agreement is terminated, to pay or cause to be
paid all expenses incident to the performance of the Company's obligations
under this Agreement, including: (i) the fees, disbursements and expenses
of the Company's counsel and the Company's accountants in connection with
the issuance and sale of the Securities and all other fees or expenses in
connection with the preparation of the Memorandum and all amendments and
supplements thereto, including all printing costs associated therewith,
and the delivering of copies thereof to the Initial Purchasers, in the
quantities herein above specified, (ii) all costs and expenses related to
the transfer and delivery of the Securities to the Initial Purchasers,
including any transfer or other taxes payable thereon, (iii) the cost of
printing or producing any Blue Sky or legal investment memorandum in
connection with the offer and sale of the Securities under state
securities laws and all expenses in connection with the qualification of
the Securities for offer and sale under state securities laws as provided
in Section 6(d) hereof, including filing fees and the reasonable fees and
disbursements of counsel for the Initial Purchasers in connection with
such qualification and in connection with the Blue Sky or legal investment
memorandum, (iv) any fees charged by rating agencies for the rating of the
Securities, (v) all document production charges and expenses of counsel to
the Initial Purchasers (but not including their fees for professional
services) in connection with the preparation of this Agreement, (vi) the
fees and expenses, if any, incurred in connection with the admission of
the Securities for trading in PORTAL or any appropriate market system and
the listing of the Underlying Securities issuable upon conversion of the
Securities, (vii) the costs and charges of the Trustee and any transfer
agent, registrar or depositary, (viii) the cost of the preparation,
issuance and delivery of the Securities and the Underlying Securities
issuable upon conversion of the Securities, (ix) the costs and expenses of
the Company relating to investor presentations on any "road show"
undertaken in connection with the marketing of the offering of the
Securities, including, without limitation, expenses associated with the
production of road show slides and graphics, fees and expenses of any
consultants engaged in connection with the road show presentations with
the prior approval of the Company, travel and lodging expenses of the
representatives and officers of the Company and any such consultants, and
the cost of any aircraft chartered by the Company in connection with the
road show, and (x) all other costs and expenses incident to the
performance of the obligations of the Company hereunder for which
provision is not otherwise made in this Section. It is understood,
however, that except as provided in
9
this Section, Section 8, and the last paragraph of Section 10, the Initial
Purchasers will pay all of their costs and expenses, including fees and
disbursements of their counsel, transfer taxes payable on resale of any of
the Securities by them and any advertising expenses connected with any
offers they may make.
(f) Neither the Company nor any Affiliate, nor any person acting on
its or their behalf, will sell, offer for sale or solicit offers to buy or
otherwise negotiate in respect of any security (as defined in the
Securities Act) which could be integrated with the sale of the Securities
in a manner which would require the registration under the Securities Act
of the Securities.
(g) Neither the Company nor any Affiliate, nor any person acting on
its or their behalf, will, in connection with any offer or sale of the
Securities or the Underlying Securities in the United States, solicit any
offer to buy or offer or sell the Securities or the Underlying Securities
by means of any form of general solicitation or general advertising (as
those terms are used in Regulation D under the Securities Act) or in any
manner involving a public offering within the meaning of Section 4(2) of
the Securities Act.
(h) While any of the Securities or the Underlying Securities remain
"restricted securities" within the meaning of the Securities Act, to make
available, upon request, to any seller of such Securities the information
specified in Rule 144A(d)(4) under the Securities Act, unless the Company
is then subject to Section 13 or 15(d) of the Exchange Act and current in
its reporting requirements thereunder.
(i) If requested by you, to use commercially reasonable efforts to
permit the 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 the PORTAL Market.
(j) Neither the Company nor any Affiliate, nor any person acting on
its or their behalf, will engage in any directed selling efforts (as that
term is defined in Regulation S) with respect to the Securities, and the
Company and its Affiliates and each person acting on its or their behalf
(other than the Initial Purchasers) will comply with the offering
restrictions requirement of Regulation S.
(k) During the period of two years after the Closing Date or the
Option Closing Date, if later, the Company will not, and will not permit
any of its Affiliates to resell any of the Securities or the Underlying
Securities which constitute "restricted securities" under Rule 144 that
have been reacquired by any of them.
(l) Not to take any action prohibited by Regulation M under the
Exchange Act in connection with the distribution of the Securities
contemplated hereby.
(m) The Company will cooperate with the Initial Purchasers and use
commercially reasonable efforts to permit the Securities to be eligible
for clearance and settlement through The Depository Trust Company.
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(n) The Company will reserve and keep available at all times, free
of preemptive rights, shares of Common Stock for the purpose of enabling
the Company to satisfy any obligations to issue shares of Common Stock
upon conversion of the Securities.
(o) The Company shall duly list the shares of Common Stock issuable
upon conversion of the Securities on the New York Stock Exchange, subject
to official notice of issuance.
(p) Between the date hereof and the latest of (1) the Closing Date,
(2) the expiration of the period during which the Initial Purchasers may
exercise their right to purchase the Additional Securities and (3) the
Option Closing Date, the Company will not do or authorize any act or thing
that would result in an adjustment of the conversion price of the
Securities.
(q) Any information provided by the Company to publishers of
publicly available databases about the terms of the Securities shall
include a statement that the Securities have not been registered under the
Securities Act and are subject to restrictions under Rule 144A and
Regulation S.
(r) The Company will refuse, and will cause all applicable trustees
and transfer agents to refuse, to register any transfer of Securities or
Underlying Securities issued upon conversion of Securities if such
transfer is not made in accordance with the provisions of Regulation S
under the Securities Act, pursuant to an effective registration statement
under the Securities Act or pursuant to an available exemption from the
registration requirements of the Securities Act; provided that the
provisions of this paragraph shall not be applicable to any Security or
Underlying Security which has been transferred pursuant to an effective
registration statement or Rule 144 under the Securities Act, and, as a
result of which, or otherwise, is no longer subject to restrictions on
transfer under the Securities Act.
(s) All of the Securities and Underlying Securities issuable upon
conversion thereof will contain a legend to the effect that the transfer
thereof is prohibited except in accordance with the provisions of
Regulation S, pursuant to an effective registration statement under the
Securities Act or pursuant to an available exemption from registration
under the Securities Act and that hedging transactions involving those
Securities or Underlying Securities may not be conducted unless in
compliance with the Securities Act; provided that such legend may be
removed if such Securities or Underlying Securities issuable upon
conversion thereof have been transferred pursuant to an effective
registration statement or when eligible for resale under Rule 144 under
the Securities Act, and, as a result of which, or otherwise, are no longer
subject to restrictions on transfer under the Securities Act.
7. Offering of Securities; Restrictions on Transfer. (a) Each Initial
Purchaser, severally and not jointly, represents and warrants that such Initial
Purchaser is a qualified
11
institutional buyer as defined in Rule 144A under the Securities Act (a "QIB").
Each Initial Purchaser, severally and not jointly, agrees with the Company that
(i) it will not solicit offers for, or offer or sell, such Securities by any
form of general solicitation or general advertising (as those terms are used in
Regulation D under the Securities Act) or in any manner involving a public
offering within the meaning of Section 4(2) of the Securities Act in connection
with any offer and sale of the Securities in the United States and (ii) it will
solicit offers for such Securities only from, and will offer such Securities
only (A) to persons that it reasonably believes to be QIBs or (B) to persons
other than U.S. persons (as such term is defined in Regulation S) in reliance
upon Regulation S, that, in each case, in purchasing such Securities are deemed
to have represented and agreed as provided in the Memorandum under the caption
"Notice to Investors" and, in connection with each such sale pursuant to Rule
144A, it has taken or will take reasonable steps to ensure that the purchaser of
such Securities is aware that such sale is being made in reliance on Rule 144A.
(b) Each Initial Purchaser, severally and not jointly, further represents,
warrants, and agrees with respect to offers and sales pursuant to Regulation S
that:
(i) such Initial Purchaser has offered the Securities and will offer
and sell the Securities (A) as part of their distribution at any time and
(B) otherwise until one year after the later of the commencement of the
offering and the Closing Date (or Option Closing Date, if later), only in
accordance with Rule 903 of Regulation S; accordingly, neither such
Initial Purchaser, its Affiliates nor any persons acting on its or their
behalf have engaged or will engage in any directed selling efforts (within
the meaning of Regulation S) with respect to the Securities, and any such
Initial Purchaser, its Affiliates and any such persons have complied and
will comply with the offering restrictions requirement of Regulation S;
(ii) each Initial Purchaser agrees that it will not engage, directly
or indirectly, in hedging transactions with regard to the Securities or
the Underlying Securities issuable upon conversion thereof prior to the
expiration of one year after the later of the commencement of the offering
and the Closing Date (or Option Closing Date, if later) unless in
compliance with the Securities Act;
(iii) such Initial Purchaser agrees that, at or prior to
confirmation of sales of the Securities (other than sales 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 one year distribution compliance 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 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 one year after the
later of the commencement of the offering and August 26, 2002,
except in either case in accordance with Regulation S (or Rule 144A
if available) under the Securities Act. Hedging transactions with
regard to the Securities or the Underlying
12
Securities issuable upon conversion of the Securities may not be
conducted, directly or indirectly, prior to the expiration of one
year after the later of the commencement of the offering and August
26, 2002 unless in compliance with the Securities Act. Terms used
above have the meaning given to them by Regulation S.";
(iv) such Initial Purchaser (i) has not offered or sold and, prior
to the expiry of a period of six months from the Closing Date, will not
offer or sell any Securities to persons in the United Kingdom except to
persons whose ordinary activities involve them in acquiring, holding,
managing or disposing of investments (as principal or agent) for the
purposes of their businesses or otherwise in circumstances which have not
resulted and will not result in an offer to the public in the United
Kingdom within the meaning of the Public Offers of Securities Regulations
1995; (ii) 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
Financial Services and Markets Act 2000 ("FSMA")) received by it in
connection with the issue or sale of any Securities in circumstances in
which section 21(1) of the FSMA would not, if the Company was not an
authorized person, apply to the Company; and (iii) has complied and will
comply with all applicable provisions of the FSMA with respect to anything
done by it in relation to the Securities in, from or otherwise involving
the United Kingdom; and
(v) each Initial Purchaser also represents and agrees that it has
not entered and will not enter into any contractual arrangement with any
distributor with respect to the distribution of the Securities, except
with its Affiliates or with the prior written consent of the Company.
Terms used in this Section 7(b) have the meanings given to them by Regulation S.
8. Indemnity and Contribution. (a) The Company agrees to indemnify and
hold harmless each Initial Purchaser and each person, if any, who controls any
Initial Purchaser within the meaning of either Section 15 of the Securities Act
or Section 20 of the Exchange Act from and against any and all losses, claims,
damages and liabilities (including, without limitation, any legal or other
expenses reasonably incurred in connection with defending or investigating any
such action or claim) caused by any untrue statement or alleged untrue statement
of a material fact contained in the Memorandum (as amended or supplemented if
the Company shall have furnished any amendments or supplements thereto), or
caused by any omission or alleged omission to state therein a material fact
necessary to make the statements therein in the light of the circumstances under
which they were made not misleading, except insofar as such losses, claims,
damages or liabilities are caused by any such untrue statement or omission or
alleged untrue statement or omission based upon information relating to any
Initial Purchaser furnished to the Company in writing by such Initial Purchaser
through you expressly for use therein.
(b) Each Initial Purchaser agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers and each person, if
any, who controls the Company within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act to the same extent as the
foregoing indemnity from the Company to such Initial
13
Purchaser, but only with reference to information relating to such Initial
Purchaser furnished to the Company in writing by such Initial Purchaser through
you expressly for use in either Memorandum or any amendments or supplements
thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to Section 8(a) or 8(b), such person (the "INDEMNIFIED PARTY")
shall promptly notify the person against whom such indemnity may be sought (the
"INDEMNIFYING PARTY") in writing and the indemnifying party, upon request of the
indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the reasonable
fees and disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for the fees and expenses of more than one separate firm (in addition
to any local counsel) for all such indemnified parties and that all such fees
and expenses shall be reimbursed as they are incurred. Such separate firm shall
be designated in writing by Xxxxxx Xxxxxxx & Co. Incorporated and Xxxxxxx Xxxxx
Barney Inc., in the case of parties indemnified pursuant to Section 8(a), and by
the Company, in the case of parties indemnified pursuant to Section 8(b). The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment. Notwithstanding the foregoing sentence, if at
any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel as contemplated
by the second and third sentences of this paragraph, the indemnifying party
agrees that it shall be liable for any settlement of any proceeding effected
without its written consent if (i) such settlement is entered into more than 30
days after receipt by such indemnifying party of the aforesaid request and (ii)
such indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened proceeding in respect
of which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such settlement
includes an unconditional release of such indemnified party from all liability
on claims that are the subject matter of such proceeding.
(d) To the extent the indemnification provided for in Section 8(a) or 8(b)
is unavailable to an indemnified party or insufficient in respect of any losses,
claims, damages or liabilities referred to therein, then each indemnifying party
under such paragraph, in lieu of indemnifying such indemnified party thereunder,
shall contribute to the amount paid or payable by such
14
indemnified party as a result of such losses, claims, damages or liabilities (i)
in such proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and the Initial Purchasers on the other hand from
the offering of the Securities or (ii) if the allocation provided by clause
8(d)(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
8(d)(i) above but also the relative fault of the Company on the one hand and of
the Initial Purchasers on the other hand in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. The relative benefits received
by the Company on the one hand and the Initial Purchasers on the other hand in
connection with the offering of the Securities shall be deemed to be in the same
respective proportions as the net proceeds from the offering of the Securities
(before deducting expenses) received by the Company and the total discounts and
commissions received by the Initial Purchasers, in each case as set forth in the
Memorandum, bear to the aggregate offering price of the Securities. The relative
fault of the Company on the one hand and of the Initial Purchasers on the other
hand 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 by the Initial Purchasers and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or omission.
The Initial Purchasers' respective obligations to contribute pursuant to this
paragraph are several in proportion to the respective principal amount of
Securities they have purchased hereunder, and not joint.
(e) The Company and the Initial Purchasers agree that it would not be just
or equitable if contribution pursuant to Section 8(d) were determined by pro
rata allocation (even if the Initial Purchasers were treated as one entity for
such purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in Section 8(d). The amount paid or
payable by an indemnified party as a result of the losses, claims, damages and
liabilities referred to in Section 8(d) shall be deemed to include, subject to
the limitations set forth above, 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 Section 8, no Initial
Purchaser shall be required to contribute any amount in excess of the amount by
which the total price at which the Securities resold by it in the initial
placement of such Securities were offered to investors exceeds the amount of any
damages that such Initial Purchaser has otherwise been required to pay by reason
of such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The remedies provided
for in this Section 8 are not exclusive and shall not limit any rights or
remedies which may otherwise be available to any indemnified party at law or in
equity.
(f) The indemnity and contribution provisions contained in this Section 8
and the representations, warranties and other statements of the Company
contained in this Agreement shall remain operative and in full force and effect
regardless of (i) any termination of this Agreement, (ii) any investigation made
by or on behalf of any Initial Purchaser or any person controlling any Initial
Purchaser or by or on behalf of the Company, its officers or directors or
15
any person controlling the Company and (iii) acceptance of and payment for any
of the Securities.
9. Termination. This Agreement shall be subject to termination by notice
given by you to the Company, if (a) after the execution and delivery of this
Agreement and prior to the Closing Date (i) trading generally shall have been
suspended or materially limited, or minimum or maximum prices for trading shall
have been fixed or maximum ranges for prices shall have been required, on or by,
as the case may be, any of the New York Stock Exchange, the American Stock
Exchange, the National Association of Securities Dealers, Inc., the Chicago
Board of Options Exchange, the Chicago Mercantile Exchange or the Chicago Board
of Trade or the clearance or settlement of such trading generally shall have
been materially disrupted, (ii) trading of any securities of the Company shall
have been suspended on any exchange or in any over-the-counter market, (iii) a
general moratorium on commercial banking activities in New York shall have been
declared by either Federal or New York State authorities or a material
disruption in commercial banking in the United States shall have occurred or
(iv) there shall have occurred any outbreak or escalation of hostilities,
including any act or acts of terrorism, or any change in financial markets or
any calamity or crisis that, in your judgment, is material and adverse and (b)
in the case of any of the events specified in clauses 9(a)(i) through 9(a)(iv),
such event, singly or together with any other such event, makes it, in your
judgment, impracticable or inadvisable to market, sell or deliver the Securities
on the terms and in the manner contemplated in the Memorandum.
10. Effectiveness; Defaulting Initial Purchasers. This Agreement shall
become effective upon the execution and delivery hereof by the parties hereto.
If, on the Closing Date, or the Option Closing Date, as the case may be,
any one or more of the Initial Purchasers shall fail or refuse to purchase
Securities that it or they have agreed to purchase hereunder on such date, and
the aggregate principal amount of Securities which such defaulting Initial
Purchaser or Initial Purchasers agreed but failed or refused to purchase is not
more than one-tenth of the aggregate principal amount of Securities to be
purchased on such date, the other Initial Purchasers shall be obligated
severally in the proportions that the principal amount of Firm Securities set
forth opposite their respective names in Schedule I bears to the aggregate
principal amount of Firm Securities set forth opposite the names of all such
non-defaulting Initial Purchasers, or in such other proportions as you may
specify, to purchase the Securities which such defaulting Initial Purchaser or
Initial Purchasers agreed but failed or refused to purchase on such date;
provided that in no event shall the principal amount of Securities that any
Initial Purchaser has agreed to purchase pursuant to this Agreement be increased
pursuant to this Section 10 by an amount in excess of one-ninth of such
principal amount of Securities without the written consent of such Initial
Purchaser. If, on the Closing Date any Initial Purchaser or Initial Purchasers
shall fail or refuse to purchase Firm Securities which it or they have agreed to
purchase hereunder on such date and the aggregate principal amount of Securities
with respect to which such default occurs is more than one-tenth of the
aggregate principal amount of Firm Securities to be purchased on such date, and
arrangements satisfactory to you and the Company for the purchase of such Firm
Securities are not made within 36 hours after such default, this Agreement shall
terminate without liability on the part of any non-defaulting Initial Purchaser
or of the Company. In any such case either you or the
16
Company shall have the right to postpone the Closing Date, but in no event for
longer than seven days, in order that the required changes, if any, in the
Memorandum or in any other documents or arrangements may be effected. If, on the
Option Closing Date, any Initial Purchaser or Initial Purchasers shall fail or
refuse to purchase Additional Securities and the aggregate principal amount of
Additional Securities with respect to which such default occurs is more than
one-tenth of the aggregate principal amount of Additional Securities to be
purchased, the non-defaulting Initial Purchasers shall have the option to (a)
terminate their obligation hereunder to purchase Additional Securities or (b)
purchase not less than the principal amount of Additional Securities that such
non-defaulting Initial Purchasers would have been obligated to purchase in the
absence of such default. Any action taken under this paragraph shall not relieve
any defaulting Initial Purchaser from liability in respect of any default of
such Initial Purchaser under this Agreement.
If this Agreement shall be terminated by the Initial Purchasers, or any of
them, because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason the Company shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Initial Purchasers or such Initial
Purchasers as have so terminated this Agreement with respect to themselves,
severally, for all out-of-pocket expenses (including the fees and disbursements
of their counsel) reasonably incurred by such Initial Purchasers in connection
with this Agreement or the offering contemplated hereunder.
11. Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
12. Applicable Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York.
13. Headings. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
17
Very truly yours,
XXXXXX CORPORATION
By: /s/ X. X. Xxxxxxxxx
-----------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President, Treasurer
Accepted as of the date hereof
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxx Xxxxx Barney Inc.
SunTrust Capital Markets, Inc.
Wachovia Securities, Inc.
Acting severally on behalf of themselves
and the several Initial Purchasers
named in Schedule I hereto.
By: Xxxxxx Xxxxxxx & Co. Incorporated
By: /s/ Xxxxxx Xxxxxxxxx
----------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Managing Director
18
SCHEDULE I
PRINCIPAL AMOUNT OF FIRM
INITIAL PURCHASER SECURITIES TO BE PURCHASED
----------------------------------------- --------------------------
Xxxxxx Xxxxxxx & Co. Incorporated........ $53,125,000
Xxxxxxx Xxxxx Barney Inc................. 53,125,000
SunTrust Capital Markets, Inc............ 6,250,000
Wachovia Securities, Inc................. 12,500,000
------------
Total:............................. $125,000,000
============
19
SCHEDULE II
Persons to Deliver Lock-Up Agreements
Xxxxxx X. Xxxxxxx
Xxxxxx X. XxXxxxx, Xx.
Xxxxx X. XxXxxxxx
Xxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx
Xxxxx Xxx III
Xxxxx Xxxxx
Xxxxxxx X. Xxxxxxx
Xxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxxx
Xxxxx X. Xxxxx
Xxxxxxx X. Xxxxxxxxxx
Xxxxx X. Xxxxxxxx
Xxxxx X. Xxxxx
Xxxx X. Xxxxxxxx
Xxxxxx X. Xxxxx
Xxxx X. XxXxxxxx
Xxxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx
Xxxxx X. Xxxx
Xxxxx X. Xxxxxxxxx
20
EXHIBIT A-1
OPINION OF HOLLAND & KNIGHT LLP
The opinion of the counsel for the Company, to be delivered pursuant to
Section 5(c) of the Purchase Agreement shall be to the effect that:
A. The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the State of Delaware, has the
corporate power and authority to own its property and to conduct its business as
described in the Memorandum, the Company is duly qualified to transact business
in California, Florida, Illinois, Massachusetts, New York, Ohio and Texas, the
Company's status is active in the State of Florida, and the Company is in good
standing in each other jurisdiction listed in this paragraph.
B. The Purchase Agreement has been duly authorized, executed and
delivered by the Company.
C. The authorized capital stock of the Company conforms as to legal
matters to the description thereof contained in the Memorandum.
D. The Securities have been duly authorized by the Company and, when
executed and authenticated in accordance with the provisions of the Indenture
and delivered to and paid for by the Initial Purchasers in accordance with the
terms of the Purchase Agreement, will be valid and binding obligations of the
Company, enforceable in accordance with their terms, subject to applicable
bankruptcy, insolvency or similar laws affecting creditors' rights generally and
general principles of equity, and will be entitled to the benefits of the
Indenture pursuant to which such Securities are to be issued and of the
Registration Rights Agreement.
E. The Underlying Securities reserved for issuance upon conversion of
the Securities have been duly authorized and reserved and, when issued upon
conversion of the Securities in accordance with the terms of the Securities,
will be validly issued, fully paid and non-assessable, and the issuance of the
Underlying Securities will not be subject to any preemptive or similar rights.
F. Each of the Indenture and the Registration Rights Agreement has been
duly authorized, executed and delivered by, and is a valid and binding agreement
of, the Company, enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency or similar laws affecting creditors' rights generally and
general principles of equity and except as rights to indemnification and
contribution under the Registration Rights Agreement may be limited under
Applicable Law.
G. The execution and delivery by the Company of, and the performance by
the Company of its obligations under, the Purchase Agreement, the Indenture, the
Registration Rights Agreement and the Securities will not contravene (i) any
provision of Applicable Law or the certificate of incorporation or by-laws of
the Company, (ii) any agreement or other
21
instrument listed as an exhibit to the Company's Annual Report on Form 10-K/A
for the year ended June 29, 2001 (the "2001 Form 10-K") or Quarterly Reports on
Form 10-Q/A for the periods ended September 28, 2001 and December 28, 2001, or
Quarterly Report on Form 10-Q for the period ended March 29, 2002 or that would
be required to be filed as a material agreement exhibit to a quarterly report by
the Company on Form 10-Q (provided, that in determining which documents would be
required to be so filed, such counsel may rely on an officer's certificate that
specifies the agreements that the Company would be required to be so filed), or
(iii) to the best of such counsel's knowledge, any judgment, order or decree of
any governmental body, agency or court having jurisdiction over the Company or
any subsidiary.
H. No Governmental Approval is required for the performance by the
Company of its obligations under the Purchase Agreement, the Indenture, the
Registration Rights Agreement or the Securities, except such as may be required
by the securities or blue sky laws of the various states in connection with the
offer and sale of the Securities and by federal and state securities laws with
respect to the Company's obligations under the Registration Rights Agreement.
I. After due inquiry, such counsel does not know of any legal or
governmental proceedings pending or threatened to which the Company or any of
its subsidiaries is a party or to which any of the properties of the Company or
any of its subsidiaries is subject and that would be required to be described by
the Company in Item 3 of an annual report on Form 10-K, other than proceedings
fairly summarized in all material respects in the Memorandum.
J. The Company is not, and after giving effect to the offering and sale
of the Securities and the application of the proceeds thereof as described in
the Memorandum will not be, required to register as an "investment company" as
such term is defined in the Investment Company Act of 1940, as amended.
K. The statements in the Memorandum under the captions "Description of
Debentures," "Description of Capital Stock," "Business-Legal Proceedings," "Plan
of Distribution," "Notice to Investors" and in "Item 3-Legal Proceedings" of the
Company's most recent annual report on Form 10-K/A, insofar as such statements
constitute summaries of the legal matters, documents or proceedings referred to
therein, fairly summarize the matters referred to therein.
L. The statements in the Memorandum under the caption "Certain United
States Federal Income Tax Considerations," insofar as such statements constitute
a summary of the United States Federal tax laws referred to therein, are
accurate and fairly summarize in all material respects the United States Federal
tax laws referred to therein.
M. Such counsel (i) is of the opinion that each document incorporated
by reference in the Memorandum (except for financial statements and schedules
and other financial and statistical data included therein as to which such
counsel need not express any opinion), complied as to form when filed with the
Commission in all material respects with the Exchange Act and the rules and
regulations of the Commission thereunder and (ii) has no reason to believe that
(except for financial statements and schedules and other financial and
statistical data as to which such counsel need not express any belief) the
Memorandum when issued contained, or as
22
of the date such opinion is delivered contains, any untrue statement of a
material fact or omitted or omits to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading.
With respect to the matters referred to in the paragraph above, counsel
may state that his or her opinions or beliefs are based upon his or her
participation in the preparation of the Memorandum (and any amendments or
supplements thereto) and in conferences with representatives of the Company and
the independent accountants of the Company, at which the contents of the
Memorandum were discussed and review of the documents incorporated by reference
therein but, except as set forth in paragraphs 12 and 13 are without independent
check or verification.
N. Based upon the representations, warranties and agreements of the
Company in Sections 1(p), 1(q), 6(f), 6(g) and 6(j) of the Purchase Agreement
and of the Initial Purchasers in Section 7 of the Purchase Agreement, it is not
necessary in connection with the offer, sale and delivery of the Securities to
the Initial Purchasers under the Purchase Agreement or in connection with the
initial resale of such Securities by the Initial Purchasers in accordance with
Section 7 of the Purchase Agreement to register the Securities under the
Securities Act of 1933 or to qualify the Indenture under the Trust Indenture Act
of 1939, it being understood that no opinion is expressed as to any subsequent
resale of any Security or Underlying Security.
23
EXHIBIT A-2
OPINION OF COMPANY COUNSEL
The opinion of Xxxxx X. Xxxxxx, Vice President-Counsel, Corporate &
Commercial Operations for the Company, to be delivered pursuant to Section 5(c)
of the Purchase Agreement shall be to the effect that:
A. The execution and delivery by the Company of, and the performance by
the Company of its obligations under, the Purchase Agreement, the Indenture, the
Registration Rights Agreement and the Securities will not contravene (i) any
provision of applicable law or the certificate of incorporation or by-laws of
the Company except that no opinion is given by such counsel as to rights to
indemnification and contribution under the Purchase Agreement or the
Registration Rights Agreement, (ii) to the best of such counsel's knowledge any
agreement or other instrument binding upon the Company or any of its
subsidiaries that is material to the Company and its subsidiaries, taken as a
whole, or (iii) to the best of such counsel's knowledge, any judgment, order or
decree of any governmental body, agency or court having jurisdiction over the
Company.
B. No Governmental Approval is required for the performance by the
Company of its obligations under the Purchase Agreement, the Indenture, the
Registration Rights Agreement or the Securities, except such as may be required
by the securities or blue sky laws of the various states in connection with the
offer and sale of the Securities and by federal and state securities laws with
respect to the Company's obligations under the Registration Rights Agreement.
C. After due inquiry, such counsel does not have knowledge of any legal
or governmental proceedings pending or threatened to which the Company or any of
its subsidiaries is a party or to which any of the properties of the Company or
any of its subsidiaries is subject other than proceedings fairly summarized in
all material respects in the Memorandum and proceedings which such counsel
believes are not likely to have a material adverse effect on the Company and its
subsidiaries, taken as a whole, or on the power or ability of the Company to
perform its obligations under the Purchase Agreement, the Indenture, the
Registration Rights Agreement or the Securities or to consummate the
transactions contemplated by the Memorandum.
D. Such counsel (i) is of the opinion that each document incorporated
by reference in the Memorandum (except for financial statements and schedules
and other financial and statistical data included therein as to which such
counsel need not express any opinion), complied as to form when filed with the
Commission in all material respects with the Exchange Act and the rules and
regulations of the Commission thereunder and (ii) has no reason to believe that
(except for financial statements and schedules and other financial and
statistical data as to which such counsel need not express any belief) the
Memorandum when issued contained, or as of the date such opinion is delivered
contains, any untrue statement of a material fact or omitted
24
or omits to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
With respect to the matters referred to in the paragraph above, counsel
may state that his or her opinions or beliefs are based upon his or her
participation in the preparation of the Memorandum (and any amendments or
supplements thereto) and in conferences with representatives of the Company and
the independent accountants of the Company, at which the contents of the
Memorandum were discussed and review of the documents incorporated by reference
therein, but except as set forth in paragraph C above, are without independent
check or verification.
25
EXHIBIT B
OPINION OF CRAVATH, SWAINE & XXXXX
The opinion of Cravath, Swaine & Xxxxx to be delivered pursuant to Section
5(d) of the Purchase Agreement shall be to the effect that:
A. The Purchase Agreement has been duly authorized, executed and
delivered by the Company.
B. The Debentures conform in all material respects to the description
thereof contained in the Memorandum.
C. The Indenture has been duly authorized, executed and delivered by
the Company and constitutes a legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms (subject
to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer and other similar laws affecting creditors' rights generally from time
to time in effect and to general principles of equity, including, without
limitation, concepts of materiality, reasonableness, good faith and fair
dealing, regardless of whether considered in a proceeding in equity or at law).
D. The Debentures have been duly authorized by the Company and, when
executed and authenticated in accordance with the provisions of the Indenture
and delivered to and paid for by the Initial Purchasers pursuant to the Purchase
Agreement, will constitute legal, valid and binding obligations of the Company
entitled to the benefits of the Indenture and enforceable against the Company in
accordance with their terms (subject to applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer and other similar laws affecting
creditors' rights generally from time to time in effect and to general
principles of equity, including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing, regardless of whether in a
proceeding in equity or at law).
E. The Debentures are convertible into shares of Common Stock of the
Company in accordance with the terms of the Indenture; the shares of Common
Stock initially issuable upon conversion of the Debentures have been duly
authorized and validly reserved for issuance upon such conversion of the
Debentures, and such shares, when issued and delivered upon such conversion in
the manner provided in the Indenture, will be validly issued, fully paid and
nonassessable. As of the date of such opinion, holders of outstanding shares of
Common Stock are not entitled to statutory preemptive rights in connection with
the issuance of such shares upon such conversion.
F. Assuming (i) the accuracy of, and compliance with, the
representations, warranties and covenants of the Company in Sections 1 and 6 of
the Purchase Agreement, (ii) the accuracy of, and compliance with, the
representations, warranties and covenants of the Initial Purchasers in Section 7
of the Purchase Agreement, (iii) the accuracy of, and compliance with, the
representations and warranties of each of the purchasers to whom the Initial
Purchasers initially resell the Debentures, as specified in the Memorandum under
the caption "Notice to
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Investors", (iv) the compliance by the Initial Purchasers with the offering and
transfer procedures and restrictions described in the Memorandum, (v) receipt by
each purchaser to whom the Initial Purchasers initially resell the Debentures of
a copy of the Offering Memorandum prior to such sale and (vi) that any
information provided by the Company or the Initial Purchasers to publishers of
publicly available databases about the terms of the Debentures shall include a
statement that the Securities have not been registered under the Act and are
subject to restrictions under Rule 144A and Regulation S, it is not necessary in
connection with the offer, sale and delivery of the Debentures or in connection
with the initial resale of the Debentures in the manner contemplated by the
Purchase Agreement and the Memorandum to register the Debentures under the
Securities Act and it is not necessary to qualify the Indenture under the Trust
Indenture Act of 1939, as amended, it being understood that no opinion is
expressed as to any subsequent resale of any Debentures or the Underlying
Securities.
In addition, in a separate letter dated the Closing Date, Cravath, Swaine
and Xxxxx shall state that:
Although such counsel has made certain inquiries and investigations in
connection with the preparation of the Memorandum, the limitations inherent in
the role of outside counsel are such that such counsel cannot and does not
assume responsibility for the accuracy or completeness of the statements made in
the Final Memorandum, except insofar as such statements relate to such counsel
and except to the extent set forth in paragraph (B) of such counsel's opinion
dated the date hereof. Subject to the foregoing, such counsel hereby advises you
that such counsel's work in connection with this matter did not disclose any
information that gave such counsel reason to believe that the Memorandum (except
for the financial statements and other information of an accounting, statistical
or financial nature included therein, as to which such counsel does not express
any view), as of its date or as of the Closing Date, included or includes an
untrue statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
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EXHIBIT C
[FORM OF LOCK-UP LETTER]
August ___, 2002
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxx Xxxxx Barney Inc.
as Representatives of the Initial Purchasers
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Dear Sirs and Mesdames:
The undersigned understands that Xxxxxx Xxxxxxx & Co. Incorporated
("Xxxxxx Xxxxxxx") and Xxxxxxx Xxxxx Xxxxxx Inc. ("SSB") propose to enter into a
Purchase Agreement (the "Purchase Agreement") with Xxxxxx Corporation, a
Delaware corporation (the "Company"), providing for the offering (the
"Offering") by the several Initial Purchasers named therein, including Xxxxxx
Xxxxxxx and SSB (the "Initial Purchasers"), of certain convertible debentures of
the Company (the "Securities"). The Securities will be convertible into shares
of Common Stock, par value $1.00 of the Company (the "Common Stock").
To induce the Initial Purchasers that may participate in the Offering to
continue their efforts in connection with the Offering, the undersigned hereby
agrees that, without the prior written consent of Xxxxxx Xxxxxxx and SSB on
behalf of the Initial Purchasers, it will not, during the period commencing on
the date hereof and ending 90 days after the date of the final offering
memorandum relating to the Offering (the "Final Memorandum"), (1) offer, pledge,
sell, contract to sell, sell any option or contract to purchase, purchase any
option or contract to sell, grant any option, right or warrant to purchase,
lend, or otherwise transfer or dispose of, directly or indirectly, any shares of
Common Stock or any securities convertible into or exercisable or exchangeable
for Common Stock or (2) enter into any swap or other arrangement that transfers
to another, in whole or in part, any of the economic consequences of ownership
of the Common Stock, whether any such transaction described in clause (1) or (2)
above is to be settled by delivery of Common Stock or such other securities, in
cash or otherwise. The foregoing sentence shall not apply to (a) transactions
relating to shares of Common Stock or other securities acquired in open market
transactions after the completion of the Offering, (b) transfers of Common Stock
or options to purchase Common Stock made as a bona fide gift or gifts, provided
that the donee or donees thereof agree to be bound by the restrictions set forth
herein or (c) transfers of shares of Common Stock or options to purchase Common
Stock made to any trust for the direct or indirect benefit of the undersigned or
the immediate family of the undersigned, provided that the trustee of the trust
agrees to be bound by the restrictions set forth herein, and
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provided further that any such transfer shall not involve a disposition for
value or (d) deemed sales upon the withholding of shares to pay the exercise
price of options or the related tax payments upon such exercise. In addition,
the undersigned agrees that, without the prior written consent of Xxxxxx Xxxxxxx
and SSB on behalf of the Initial Purchasers, it will not, during the period
commencing on the date hereof and ending 90 days after the date of the Final
Memorandum, make any demand for or exercise any right with respect to, the
registration of any shares of Common Stock or any security convertible into or
exercisable or exchangeable for Common Stock. The undersigned also agrees and
consents to the entry of stop transfer instructions with the Company's transfer
agent and registrar against the transfer of the undersigned's share of Common
Stock except in compliance with the foregoing restrictions. The undersigned
understands that the Company and the Initial Purchasers are relying upon this
Lock-Up Agreement in proceeding toward consummation of the Offering. The
undersigned further understands that this Lock-Up Agreement is irrevocable and
shall be binding upon the undersigned's heirs, legal representatives, successors
and assigns.
Whether or not the Offering actually occurs depends on a number of
factors, including market conditions. Any Offering will only be made pursuant to
a Purchase Agreement, the terms of which are subject to negotiation between the
Company and the Initial Purchasers. This Agreement shall terminate and be of no
further force or effect if (a) the undersigned ceases to be an executive officer
or director of the Company, or (b) the Company informs Xxxxxx Xxxxxxx and SSB in
writing that it has determined not to enter into the Purchase Agreement or to
effect the Offering.
Very truly yours,
--------------------------------------
(Name)
--------------------------------------
(Address)
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