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EXHIBIT 10.19
COOPERATIVE COMPUTING, INC.
$100,000,000
9.0% Senior Subordinated Notes due 2008
PURCHASE AGREEMENT
February 5, 1998
CHASE SECURITIES INC.
NATIONSBANC XXXXXXXXXX SECURITIES LLC
c/o Chase Securities Inc.
000 Xxxx Xxxxxx, 0xx xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Cooperative Computing, Inc., a Delaware corporation (the
"Company"), proposes to issue and sell $100,000,000 aggregate principal amount
of its 9.0% Senior Subordinated Notes due 2008 (the "Notes"). The Notes will
be issued pursuant to an Indenture to be dated as of February 6, 1998 (the
"Indenture") between the Company and Norwest Bank Minnesota, National
Association, as trustee (the "Trustee"). The Company hereby confirms its
agreement with Chase Securities Inc. ("CSI") and NationsBanc Xxxxxxxxxx
Securities LLC (together, the "Initial Purchasers") concerning the purchase of
the Notes from the Company by the several Initial Purchasers.
The Notes will be offered and sold to the Initial Purchasers
without being registered under the Securities Act of 1933, as amended (the
"Securities Act"), in reliance upon exemptions therefrom. The Company has
prepared a preliminary offering memorandum dated January 20, 1998 (the
"Preliminary Offering Memorandum") and an offering memorandum dated the date
hereof (the "Final Offering Memorandum") setting forth information concerning
the Company and the Notes. Copies of the Preliminary Offering Memorandum have
been, and copies of the Final Offering Memorandum will be, delivered by the
Company to the Initial Purchasers pursuant to the terms of this Agreement. Any
references herein to the Preliminary Offering Memorandum and the Final Offering
Memorandum shall be deemed to include all amendments and supplements thereto,
unless otherwise noted. The Company hereby confirms that it has authorized the
use of the Preliminary Offering Memorandum and the Final Offering Memorandum in
connection with the offering and resale of the Notes by the Initial Purchasers
in accordance with Section 2.
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Holders of the Notes (including the Initial Purchasers and
their direct and indirect transferees) will be entitled to the benefits of an
Exchange and Registration Rights Agreement, substantially in the form attached
hereto as Annex A (the "Registration Rights Agreement"), pursuant to which the
Company will agree to file with the Securities and Exchange Commission (the
"Commission") (i) a registration statement under the Securities Act (the
"Exchange Offer Registration Statement") registering an issue of senior
subordinated notes of the Company (the "Exchange Notes") which are identical in
all material respects to the Notes (except that the Exchange Notes will not
contain terms with respect to transfer restrictions) and (ii) under certain
circumstances, a shelf registration statement with respect to the resale of the
Notes pursuant to Rule 415 under the Securities Act (the "Shelf Registration
Statement").
The Notes are being offered concurrently in connection with
the refinancing of certain of the Company's outstanding indebtedness. In
connection with the offering of the Notes, the Company is amending and
restating its senior secured credit facility with The Chase Manhattan Bank (as
amended and restated, the "Senior Credit Facility"). The proceeds of the
offering and sale of Notes contemplated hereby together with borrowings under
the Senior Credit Facility will be used to refinance outstanding indebtedness
under the existing senior credit facility of the Company.
Capitalized terms used but not defined herein shall have the
meanings given to such terms in the Final Offering Memorandum.
1. Representations, Warranties and Agreements of the
Company. The Company represents and warrants to, and agrees with, the several
Initial Purchasers on and as of the date hereof and the Closing Date (as
defined in Section 3) that:
(a) Each of the Preliminary Offering Memorandum and the
Final Offering Memorandum, as of its respective date, did not, and on
the Closing Date the Final Offering Memorandum will not, contain any
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading; provided, however, that the Company makes
no representation or warranty as to information contained in or
omitted from the Preliminary Offering Memorandum or the Final Offering
Memorandum in reliance upon and in conformity with written information
relating to the Initial Purchasers furnished to the Company by or on
behalf of any Initial Purchaser expressly for use therein, as defined
in Section 16 hereof (the "Initial Purchasers' Information").
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(b) Assuming the accuracy of the representations and
warranties of the Initial Purchasers contained in Section 2 and their
compliance with the agreements set forth herein, it is not necessary,
in connection with the issuance and sale of the Notes to the Initial
Purchasers and the offer, resale and delivery of the Notes by the
Initial Purchasers in the manner contemplated by this Agreement and
the Final Offering Memorandum, to register the Notes under the
Securities Act or to qualify the Indenture under the Trust Indenture
Act of 1939, as amended (the "Trust Indenture Act").
(c) The Company and each of its subsidiaries have been
duly incorporated and are validly existing as corporations in good
standing under the laws of their respective jurisdictions of
incorporation, are duly qualified to do business and are in good
standing as foreign corporations in each jurisdiction in which their
respective ownership or lease of property or the conduct of their
respective businesses requires such qualification and have all
corporate power and authority necessary to own or hold their
respective properties and to conduct the businesses in which they are
engaged, except where the failure to so qualify or have such power or
authority would not, singularly or in the aggregate, have a material
adverse effect on the condition (financial or otherwise), results of
operations or business or prospects of the Company and its
subsidiaries, taken as a whole (a "Material Adverse Effect").
(d) The authorized capital stock of the Company consists
of 1000 shares of common stock, par value $.01 per share; all of the
outstanding shares of capital stock of the Company have been duly and
validly authorized and issued and are fully paid and non-assessable;
and the capital stock of the Company conforms in all material respects
to the description thereof contained in the Final Offering Memorandum.
All of the outstanding shares of capital stock of each subsidiary of
the Company have been duly and validly authorized and issued, are
fully paid and non-assessable and are owned directly or indirectly by
the Company, free and clear of any lien, charge, encumbrance, security
interest, restriction upon voting or transfer or any other claim of
any third party (other than liens and security interests created
pursuant to the existing senior credit agreement or the Senior Credit
Facility).
(e) The Company has all requisite corporate power and
authority to execute and deliver this Agreement, the Indenture, the
Registration Rights Agreement, the Notes and the Senior Credit
Facility (collectively, the "Transaction Documents") and to perform
its obligations hereunder and thereunder; and all corporate action
required to be taken by the Company for the due and proper
authorization, execution and delivery of each of the Transaction
Documents and the consummation of the transactions contemplated
thereby have been duly and validly taken.
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(f) This Agreement has been duly authorized, executed and
delivered by the Company and (assuming the due authorization,
execution and delivery of this Agreement by the Initial Purchasers)
constitutes a valid and legally binding agreement of the Company,
enforceable against the Company in accordance with the terms hereof,
except to the extent that (i) such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium and
other similar laws affecting creditors rights generally and by general
equitable principles (whether considered in a proceeding in equity or
at law) and (ii) the enforceability of rights to indemnification and
contribution hereunder may be limited by federal or state securities
laws or regulations or the public policy underlying such laws or
regulations.
(g) The Registration Rights Agreement has been duly
authorized by the Company and, when duly executed and delivered in
accordance with its terms by each of the parties thereto, will
constitute a valid and legally binding agreement of the Company,
enforceable against the Company in accordance with its terms, except
to the extent that (i) such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium and
other similar laws affecting creditors' rights generally and by
general equitable principles (whether considered in a proceeding in
equity or at law) and (ii) the enforceability of rights to
indemnification and contribution thereunder may be limited by federal
or state securities laws or regulations or the public policy
underlying such laws or regulations.
(h) The Indenture has been duly authorized by the Company
and, when duly executed and delivered in accordance with its terms by
each of the parties thereto, will constitute a valid and legally
binding agreement of the Company, enforceable against the Company in
accordance with its terms, except to the extent that such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other similar laws affecting creditors'
rights generally and by general equitable principles (whether
considered in a proceeding in equity or at law) and except as to the
effect on the Notes of the laws of any jurisdiction other than federal
law and the law of the State of New York wherein any purchaser of the
Notes may be located or wherein enforcement may be sought which limits
the rate of interest legally chargeable or collectible.
(i) The Notes have been duly authorized by the Company
and, when duly executed, authenticated, issued and delivered as
provided in the Indenture and paid for as provided herein, will be
duly and validly issued and outstanding and will constitute valid and
legally binding obligations of the Company entitled to the benefits of
the Indenture, enforceable against the Company in accordance with
their terms, except to the extent that such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization,
moratorium and other similar laws affecting creditors' rights
generally and by general equitable principles (whether considered in a
proceeding in equity or at law) and except as to the effect on the
Notes of the laws of any jurisdiction other than federal law and the
law of the State of New York wherein any purchaser of the Notes may be
located or wherein enforcement may be sought which limits the rate of
interest legally chargeable or collectible.
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(j) The Exchange Notes have been duly authorized by the
Company and, when duly executed, authenticated, issued and delivered
as provided in the Indenture and the Registration Rights Agreement,
will be duly and validly issued and outstanding and will constitute
valid and legally binding obligations of the Company entitled to the
benefits of the Indenture, enforceable against the Company in
accordance with their terms, except to the extent that such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other similar laws affecting creditors'
rights generally and by general equitable principles (whether
considered in a proceeding in equity or at law) and except as to the
effect on the Notes of the laws of any jurisdiction other than federal
law and the law of the State of New York wherein any purchaser of the
Notes may be located or wherein enforcement may be sought which limits
the rate of interest legally chargeable or collectible.
(k) The Senior Credit Facility has been duly authorized,
executed and delivered by the Company and constitutes a valid and
legally binding agreement of the Company enforceable against the
Company in accordance with its terms, except to the extent that such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other similar laws affecting creditors'
rights generally and by general equitable principles (whether
considered in a proceeding in equity or at law), other than the
set-off provisions contained therein, which may not be enforceable.
(l) Each Transaction Document conforms in all material
respects to the description thereof contained in the Final Offering
Memorandum.
(m) The execution, delivery and performance by the
Company of each of the Transaction Documents, the issuance,
authentication, sale and delivery of the Notes and compliance by the
Company with the terms thereof and the consummation of the
transactions contemplated by the Transaction Documents will not,
except as contemplated by the Transaction Documents, conflict with or
result in a breach or violation of any of the terms or the provisions
of, or constitute a default under, or, with notice or lapse of time or
both, constitute a default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any of its subsidiaries pursuant to, any
indenture, mortgage, deed of trust, loan agreement or other material
agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, except for any such
conflict, breach, violation, default, lien, charge or encumbrance that
could not, singly or in the aggregate, reasonably be expected to
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have a Material Adverse Effect or any material adverse effect on the
ability of the Company to perform its obligations under the
Transaction Documents, nor will such actions result in any violation
of the provisions of the charter or by-laws of the Company or any of
its subsidiaries or any statute or any judgment, order, decree, rule
or regulation of any court or arbitrator or governmental agency or
body having jurisdiction over the Company or any of its subsidiaries
or any of their properties or assets, except for such violations that
could not, singly or in the aggregate, reasonably be expected to have
a Material Adverse Effect; and no consent, approval, authorization or
order of, or filing or registration with, any such court or arbitrator
or governmental agency or body under any such statute, judgment,
order, decree, rule or regulation is required for the execution,
delivery and performance by the Company of each of the Transaction
Documents, the issuance, authentication, sale and delivery of the
Notes and compliance by the Company with the terms thereof and the
consummation of the transactions contemplated by the Transaction
Documents, except for such consents, approvals, authorizations,
filings, registrations or qualifications (i) which shall have been
obtained or made prior to the Closing Date, (ii) which may be required
under the Trust Indenture Act of 1939, as amended, in connection with
the Exchange Notes, (iii) the failure of which to obtain or make could
not, singly or in the aggregate, reasonably be expected to have a
Material Adverse Effect or any material adverse effect on the ability
of the Company to perform its obligations under the Transaction
Documents and (iv) as may be required to be obtained or made under the
Securities Act and applicable state securities laws as provided in the
Registration Rights Agreement.
(n) Ernst & Young LLP are independent certified public
accountants with respect to the Company and its subsidiaries within
the meaning of Rule 101 of the Code of Professional Conduct of the
American Institute of Certified Public Accountants ("AICPA") and its
interpretations and rulings thereunder. The historical financial
statements contained in the Final Offering Memorandum have been
prepared in accordance with United States generally accepted
accounting principles consistently applied throughout the periods
covered thereby and fairly present in all material respects the
financial position of the entities purported to be covered thereby at
the respective dates indicated and the results of their operations and
their cash flows for the respective periods indicated; and the
financial information contained in the Final Offering Memorandum under
the headings "Summary--Summary Historical Financial Data",
"Capitalization", "Selected Financial Data" and "Management's
Discussion and Analysis of Results of Operations and Financial
Condition" are derived from the accounting records of entities
purported to be covered thereby and fairly present in all material
respects the information purported to be shown thereby. The unaudited
pro forma combined financial information contained in the Final
Offering Memorandum has been prepared on a basis consistent with the
historical financial statements of the Company contained in the Final
Offering Memorandum (except for the pro forma adjustments
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specified therein), include all material adjustments to the historical
financial statements required by Rule 11-02 of Regulation S-X under
the Securities Act and the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), to reflect the transactions described in the
Final Offering Memorandum, are based on assumptions made on a
reasonable basis and fairly present the transactions described in the
Final Offering Memorandum.
(o) There are no legal or governmental proceedings
(including, without limitation, before the Federal Trade Commission
(the "FTC")) pending to which the Company or any of its subsidiaries
is a party or of which any property or assets of the Company or any of
its subsidiaries is the subject which, singularly or in the aggregate,
if determined adversely to the Company or any of its subsidiaries,
could reasonably be expected to have a Material Adverse Effect; and to
the best knowledge of the Company, no such proceedings are threatened
or contemplated by governmental authorities or threatened by others.
(p) The Company is not aware of any action that has been
taken or any statute, rule, regulation, injunction or order that has
been enacted, adopted or issued by any governmental agency or body
which prevents the issuance of the Notes or suspends the sale of the
Notes in any jurisdiction; no injunction, restraining order or order
of any nature by any federal or state court of competent jurisdiction
has been issued with respect to the Company or any of its subsidiaries
which would prevent or suspend the issuance or sale of the Notes or
the use of the Preliminary Offering Memorandum or the Final Offering
Memorandum in any jurisdiction; no action, suit or proceeding is
pending against or, to the best knowledge of the Company, threatened
against or affecting the Company or any of its subsidiaries before any
court or arbitrator or any governmental agency, body or official,
domestic or foreign, which could reasonably be expected to interfere
with or adversely affect the issuance of the Notes or in any manner
draw into question the validity or enforceability of any of the
Transaction Documents or any action taken or to be taken pursuant to
the Transaction Documents.
(q) Except as disclosed in the Final Offering Memorandum,
neither the Company nor any of its subsidiaries is (i) in violation of
its charter or by-laws, (ii) in default in any material respect, and
no event has occurred which, with notice or lapse of time or both,
would constitute such a default, in the due performance or observance
of any term, covenant or condition contained in any material
indenture, mortgage, deed of trust, loan agreement or other material
agreement or instrument to which it is a party or by which it is bound
or to which any of its property or assets is subject or (iii) in
violation in any material respect of any law, ordinance, governmental
rule, regulation, order, judgment or decree to which it or its
property or assets may be subject.
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(r) The Company and each of its subsidiaries possess all
material licenses, certificates, authorizations and permits issued by,
and have made all declarations and filings with, the appropriate
federal, state, local or foreign regulatory agencies or bodies
(including, without limitation, the FTC) which are necessary for the
ownership of their respective properties or the conduct of their
respective businesses as described in the Final Offering Memorandum,
except where the failure to possess or make the same would not,
singularly or in the aggregate, have a Material Adverse Effect, and
neither the Company nor any of its subsidiaries has received
notification of any revocation or modification of any such license,
certificate, authorization or permit or has any reason to believe that
any such license, certificate, authorization or permit will not be
renewed in the ordinary course.
(s) The Company and each of its subsidiaries have filed
all federal, state, local and foreign income and franchise tax returns
required to be filed through the date hereof and have paid all taxes
due thereon, and no tax deficiency has been determined adversely to
the Company or any of its subsidiaries which has had (nor does the
Company or any of its subsidiaries have any knowledge of any tax
deficiency which, if determined adversely to the Company or any of its
subsidiaries, could reasonably be expected to have) a Material Adverse
Effect.
(t) Neither the Company nor any of its subsidiaries is an
"investment company" within the meaning of the Investment Company Act
of 1940, as amended (the "Investment Company Act"), and the rules and
regulations of the Commission thereunder.
(u) The Company and each of its subsidiaries maintain a
system of internal accounting controls sufficient to provide
reasonable assurance that (i) transactions are executed in accordance
with management's general or specific authorizations; (ii)
transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally accepted accounting
principles and to maintain asset accountability; (iii) access to
assets is permitted only in accordance with management's general or
specific authorization; and (iv) the recorded accountability for
assets is compared with the existing assets at reasonable intervals
and appropriate action is taken with respect to any differences.
(v) The Company and each of its subsidiaries have
insurance covering their respective properties, operations, personnel
and businesses, which insurance is in amounts and insures against such
losses and risks as are adequate to protect the Company and its
subsidiaries and their respective businesses. Neither the Company nor
any of its subsidiaries has received notice from any insurer or agent
of such insurer that capital improvements or other expenditures are
required or necessary to be made in order to continue such insurance.
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(w) The Company and each of its subsidiaries own or
possess adequate rights to use all material patents, patent
applications, trademarks, service marks, trade names, trademark
registrations, service xxxx registrations, copyrights, licenses and
know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures) necessary for the conduct of their respective businesses;
and the conduct of their respective businesses does not conflict in
any material respect with, and the Company and its subsidiaries have
not received any notice of any claim of conflict with, any such rights
of others.
(x) The Company and each of its subsidiaries have good
and marketable title in fee simple to, or have valid rights to lease
or otherwise use, all items of real and personal property which are
material to the business of the Company and its subsidiaries, taken as
a whole, in each case free and clear of all liens, encumbrances,
claims and defects and imperfections of title other than (i) liens,
encumbrances and claims securing the existing senior credit agreement
or Senior Credit Facility or (ii) liens, encumbrances, claims and
defects and imperfections of title that do not materially interfere
with the use made or proposed to be made of such property by the
Company or its subsidiaries or could not reasonably be expected to
have a Material Adverse Effect.
(y) No labor disturbance by or dispute with the employees
of the Company or any of its subsidiaries exists or, to the best
knowledge of the Company and its subsidiaries, is imminent which could
reasonably be expected to have a Material Adverse Effect.
(z) There has been no storage, generation,
transportation, handling, treatment, disposal, discharge, emission or
other release of any kind of any pollutant or contaminant, or any
toxic, hazardous or other substance, waste or constituent ("Material")
by, due to or caused by the Company or any of its subsidiaries (or, to
the best knowledge of the Company and its subsidiaries, any other
entity (including any predecessor) for whose acts or omissions the
Company or any of its subsidiaries is or could reasonably be expected
to be liable) at, upon, under or from any of the property now or
previously owned, leased or operated by the Company or any of its
subsidiaries (or any predecessor), or upon any other property, in
violation of any statute or any ordinance, rule, regulation, order,
judgment, decree or permit or which would, under any statute or any
ordinance, rule (including rule of common law), regulation, order,
judgment, decree or permit, give rise to any liability, except for any
violation or liability which could not reasonably be expected to have,
singularly or in the aggregate with all such violations and
liabilities, a Material Adverse Effect; and there has been no
disposal, discharge, emission or other release of any kind onto such
property or into the environment surrounding such property of any
Material with respect to which the Company or any of its subsidiaries
has knowledge, except for any such disposal, discharge, emission or
other release of any kind which could not reasonably be expected to
have, singularly or in the aggregate with all such discharges and
other releases, a Material Adverse Effect.
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(aa) On and immediately after the Closing Date, the
Company (after giving effect to the issuance of the Notes and the
other transactions related thereto as described in the Final Offering
Memorandum) will be Solvent. As used in this paragraph, the term
"Solvent" means, with respect to the Company at a particular time,
that at such time (i) the present fair market value (or present fair
saleable value) of the assets of the Company is not less than the
total amount required to pay the probable liabilities of the Company
on its total existing debts and liabilities (including contingent
liabilities) as they become absolute and matured, (ii) the Company has
not incurred and does not intend to incur debts or liabilities beyond
its ability to pay as such debts and liabilities as they mature and
(iii) the Company is not engaged in any business or transaction, and
does not intend to engage in any business or transaction, for which
its property would constitute unreasonably small capital. In
computing the amount of such contingent liabilities at any time, it is
intended that such liabilities will be computed at the amount that, in
the light of all the facts and circumstances existing at such time,
represents the amount that can reasonably be expected to become an
actual or matured liability.
(bb) Except as described in the Final Offering Memorandum,
there are no outstanding subscriptions, rights, warrants, calls or
options to acquire, or instruments convertible into or exchangeable
for, or agreements or understandings with respect to the sale or
issuance of, any shares of capital stock of or other equity or other
ownership interest in the Company or any of its subsidiaries.
(cc) The statistical and market-related data included in
the Final Offering Memorandum are based on or derived from sources
which the Company believes to be reliable and accurate.
(dd) Neither the Company nor any of its subsidiaries owns
any "margin securities" as that term is defined in Regulations G and U
of the Board of Governors of the Federal Reserve System (the "Federal
Reserve Board"), and none of the proceeds of the sale of the Notes
will be used, directly or indirectly, for the purpose of purchasing or
carrying any margin security, for the purpose of reducing or retiring
any indebtedness which was originally incurred to purchase or carry
any margin security or for any other purpose which might cause any of
the Notes to be considered a "purpose credit" within the meanings of
Regulation G, T, U or X of the Federal Reserve Board.
(ee) Except as disclosed in the Final Offering Memorandum,
neither the Company nor any of its subsidiaries is a party to any
contract, agreement or understanding with any person that would give
rise to a valid claim against the Company or the Initial Purchasers
for a brokerage commission, finder's fee or like payment in connection
with the offering and sale of the Notes.
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(ff) The Notes satisfy the eligibility requirements of
Rule 144A(d)(3) under the Securities Act.
(gg) None of the Company, any of its affiliates or any
person acting on its or their behalf (excluding the Initial
Purchasers) has engaged or will engage in any directed selling efforts
(as such term is defined in Regulation S under the Securities Act
("Regulation S")), and all such persons have complied with the
offering restrictions requirement of Regulation S to the extent
applicable.
(hh) Neither the Company nor any of its affiliates has,
directly or through any agent (provided that no representation is made
as to the Initial Purchasers or any person acting on their behalf),
sold, offered for sale, solicited offers to buy or otherwise
negotiated in respect of, any security (as such term is defined in the
Securities Act), which is or will be integrated with the sale of the
Notes in a manner that would require registration of the Notes under
the Securities Act.
(ii) Neither the Company nor any of its affiliates nor any
other person acting on its or their behalf (provided that no
representation is made as to the Initial Purchasers or any person
acting on their behalf) has solicited offers for, or has offered and
sold, the Notes in any manner involving a public offering within the
meaning of Section 4(2) of the Securities Act.
(jj) There are no holders of securities of the Company
who, by reason of the execution by the Company of any of the
Transaction Documents or the consummation of the transactions
contemplated therein (except as contemplated by the Registration
Rights Agreement), have the right to request or demand that the
Company register under the Securities Act any securities held by them.
(kk) The Company has not taken and will not take, directly
or indirectly, any action prohibited by Regulation M under the
Exchange Act in connection with the offering of the Notes.
(ll) No forward-looking statement (within the meaning of
Section 27A of the Securities Act and Section 21E of the Exchange Act)
contained in the Preliminary Offering Memorandum or the Final Offering
Memorandum has been made or reaffirmed without a reasonable basis or
has been made or reaffirmed other than in good faith.
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(mm) None of the Company or any of its subsidiaries does
business with the government of Cuba or with any person or affiliate
located in Cuba within the meaning of Florida Statutes Section
517.075.
(nn) Since the date as of which information is given in
the Final Offering Memorandum, except as otherwise expressly stated
therein, (i) there has been no material adverse change or any
development involving a prospective material adverse change in the
condition (financial or otherwise), or in the earnings, business
affairs, management or business prospects of the Company and its
subsidiaries taken as a whole, whether or not arising in the ordinary
course of business, (ii) neither the Company nor any of its
subsidiaries has incurred any material liability or obligation, direct
or contingent, other than in the ordinary course of business, (iii)
neither the Company nor any of its subsidiaries has entered into any
material transaction other than in the ordinary course of business and
(iv) there has not been any change in the capital stock or long-term
debt (other than the refinancing of the Company's existing credit
facility and the execution of the Senior Credit Facility) of the
Company and its subsidiaries, or any dividend or distribution of any
kind declared, paid or made by the Company or any of its subsidiaries
on any class of its capital stock.
2. Purchase and Resale of the Notes. (a) On the basis
of the representations, warranties and agreements contained herein, and subject
to the terms and conditions set forth herein, the Company agrees to issue and
sell to each of the Initial Purchasers, severally and not jointly, and each of
the Initial Purchasers, severally and not jointly, agrees to purchase from the
Company, the principal amount of Notes set forth opposite the name of such
Initial Purchaser on Schedule I hereto at a purchase price equal to 97% of the
principal amount thereof. The Company shall not be obligated to deliver any of
the Notes except upon payment for all of the Notes to be purchased as provided
herein.
(b) The Initial Purchasers have advised the Company that they
propose to offer the Notes for resale upon the terms and subject to the
conditions set forth herein and in the Final Offering Memorandum. Each Initial
Purchaser, severally and not jointly, represents and warrants to, and agrees
with, the Company that (i) it is purchasing the Notes pursuant to a private
sale exemption from registration under the Securities Act, (ii) it has not
solicited offers for, or offered or sold, and will not solicit offers for, or
offer or sell, the Notes by means of any form of general solicitation or
general advertising within the meaning of Rule 502(c) of Regulation D or in any
manner involving a public offering within the meaning of Section 4(2) of the
Securities Act and (iii) it has solicited and will solicit offers for the Notes
only from, and has offered or sold and will offer, sell or deliver the Notes,
as part of its initial offering, only (A) within the United States to persons
whom it reasonably believes to be qualified institutional buyers ("Qualified
Institutional Buyers"), as defined in Rule 144A under the Securities Act ("Rule
144A"), or if any such person is buying for one or more institutional accounts
for which such person is acting as fiduciary or agent, only when such person
has represented
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to it that each such account is a Qualified Institutional Buyer to whom notice
has been given that such sale or delivery is being made in reliance on Rule
144A and in each case, in transactions in accordance with Rule 144A and (B)
outside the United States to persons other than U.S. persons in reliance on
Regulation S under the Securities Act ("Regulation S").
(c) In connection with the offer and sale of Notes in
reliance on Regulation S, each Initial Purchaser, severally and not jointly,
represents, warrants and agrees that:
(i) The Notes have not been registered under the Securities
Act and may not be offered or sold within the United States or to, or
for the account or benefit of, U.S. persons except pursuant to an
exemption from, or in transactions not subject to, the registration
requirements of the Securities Act.
(ii) Such Initial Purchaser has offered and sold the Notes,
and will offer and sell the Notes, (A) as part of their distribution
at any time and (B) otherwise until 40 days after the later of the
commencement of the offering of the Notes and the Closing Date, only
in accordance with Regulation S or Rule 144A or any other available
exemption from registration under the Securities Act.
(iii) None of such Initial Purchaser or any of its
affiliates or any other person acting on its or their behalf has
engaged or will engage in any directed selling efforts with respect to
the Notes, and all such persons have complied and will comply with the
offering restrictions requirement of Regulation S.
(iv) Such Initial Purchaser (i) has not offered or sold
and prior to the date six months after the Closing Date will not offer
or sell any Notes 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 complied and will comply with all
applicable provisions of the Financial Services Xxx 0000 and the
Public Offers of Securities Regulations 1995 with respect to anything
done by it in relation to the Notes in, from or otherwise involving
the United Kingdom and (iii) has only issued or passed on and will
only issue or pass on in the United Kingdom any document received by
it in connection with the issue of Notes to a person who is of a kind
described in Article 11(3) of the Financial Services Xxx 0000
(Investment Advertisements) (Exemptions) Order 1996 or is a person to
whom such document may otherwise lawfully be issued or passed on.
(iv) at or prior to the confirmation of sale of any Notes
sold in reliance on Regulation S, it will have sent to each
distributor, dealer or other person receiving a selling concession,
fee or other remuneration that purchase Notes from it during the
restricted period a confirmation or notice to substantially the
following effect:
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"The Notes covered hereby have not been registered under the
U.S. Securities Act of 1933, as amended (the "Securities
Act"), and may not be offered or sold within the United States
or to, or for the account or benefit of, U.S. persons (i) as
part of their distribution at any time or (ii) otherwise until
40 days after the later of the commencement of the offering of
the Notes and the date of original issuance of the Notes,
except in accordance with Regulation S or Rule 144A or any
other available exemption from registration under the
Securities Act. Terms used above have the meanings given to
them by Regulation S."
(v) it has not and will not enter into any contractual
arrangement with any distributor with respect to the distribution of
the Notes, except with its affiliates or with the prior written
consent of the Company.
Terms used in this Section 2(c) have the meanings given to them by Regulation S.
(d) Each Initial Purchaser, severally and not jointly, agrees
that, prior to or simultaneously with the confirmation of sale by the Initial
Purchaser to any purchaser of any of the Notes purchased by the Initial
Purchaser from the Company pursuant hereto, the Initial Purchaser shall furnish
to that purchaser a copy of the Final Offering Memorandum (and any amendment or
supplement thereto that the Company shall have furnished to the Initial
Purchaser prior to the date of such confirmation of sale). In addition to the
foregoing, the Initial Purchasers acknowledge and agree that the Company and,
for purposes of the opinions to be delivered to the Initial Purchasers pursuant
to Sections 5(d) and (e), counsel for the Company and for the Initial
Purchasers, respectively, may rely upon the accuracy of the representations and
warranties of the Initial Purchasers and their compliance with their agreements
contained in this Section 2, and each Initial Purchaser hereby consents to such
reliance.
(e) The Company acknowledges and agrees that the Initial
Purchasers may sell Notes to any affiliate and that any such affiliate may sell
Notes purchased by it to an Initial Purchaser.
3. Delivery of and Payment for the Notes. (a) Delivery
of and payment for the Notes shall be made at the offices of Xxxxxx Xxxxxx &
Xxxxxxx, New York, New York, or at such other place as shall be agreed upon by
the Initial Purchasers and the Company, at 10:00 A.M., New York City time, on
February 6, 1998, or at such other time or date, not later than seven full
business days thereafter, as shall be agreed upon by the Initial Purchasers and
the Company (such date and time of payment and delivery being referred to
herein as the "Closing Date").
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(b) On the Closing Date, payment of the purchase price for
the Notes shall be made to the Company by wire or book-entry transfer of
same-day funds to such account or accounts as the Company shall specify prior
to the Closing Date or by such other means as the parties hereto shall agree
prior to the Closing Date against delivery to the Initial Purchasers of the
certificates evidencing the Notes. Time shall be of the essence, and delivery
of the Notes and payment of the purchase price at the time and place specified
pursuant to this Agreement is a further condition of the obligations of the
Initial Purchasers and the Company hereunder, respectively. Upon delivery, the
Notes shall be in global form, registered in such names and in such
denominations as CSI on behalf of the Initial Purchasers shall have requested
in writing not less than two full business days prior to the Closing Date. The
Company agrees to make one or more global certificates evidencing the Notes
available for inspection by CSI on behalf of the Initial Purchasers in New
York, New York at least 24 hours prior to the Closing Date.
4. Further Agreements of the Company. The Company
agrees with each of the several Initial Purchasers:
(a) to advise the Initial Purchasers promptly and, if
requested, confirm such advice in writing, of the happening of any
event which makes any statement of a material fact made in the Final
Offering Memorandum untrue or which requires the making of any
additions to or changes in the Final Offering Memorandum (as amended
or supplemented from time to time) in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading; to advise the Initial Purchasers promptly of any order
preventing or suspending the use of the Preliminary Offering
Memorandum or the Final Offering Memorandum, of any suspension of the
qualification of the Notes for offering or sale in any jurisdiction
and of the initiation or threatening of any proceeding for any such
purpose; and to use its reasonable best efforts to prevent the
issuance of any such order preventing or suspending the use of the
Preliminary Offering Memorandum or the Final Offering Memorandum or
suspending any such qualification and, if any such suspension is
issued, to obtain the lifting thereof at the earliest possible time;
(b) to furnish to each of the Initial Purchasers and
counsel for the Initial Purchasers, without charge, as many copies of
the Preliminary Offering Memorandum and the Final Offering Memorandum
(and any amendments or supplements thereto) as may be reasonably
requested;
(c) prior to making any amendment or supplement to the
Final Offering Memorandum, to furnish a copy thereof to each of the
Initial Purchasers and counsel for the Initial Purchasers and not to
effect any such amendment or supplement to which the Initial
Purchasers shall reasonably object by notice to the Company after a
reasonable period to review, which shall not be in any case longer
than 5 business days after receipt of such copy;
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(d) if, at any time prior to completion of the resale of
the Notes by the Initial Purchasers, any event shall occur,
information shall become known or condition shall exist as a result of
which it is necessary, in the opinion of counsel for the Initial
Purchasers or counsel for the Company, to amend or supplement the
Final Offering Memorandum in order that the Final Offering Memorandum
will not include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances existing at the time it is
delivered to a purchaser, not misleading, or if it is necessary to
amend or supplement the Final Offering Memorandum to comply with
applicable law, to promptly prepare (subject to Section 4(c) above)
such amendment or supplement as may be necessary to correct such
untrue statement or omission or so that the Final Offering Memorandum,
as so amended or supplemented, will comply with applicable law;
(e) for so long as the Notes are outstanding and are
"restricted securities" within the meaning of Rule 144(a)(3) under the
Securities Act, to furnish to holders of the Notes and prospective
purchasers of the Notes designated by such holders, upon request of
such holders or such prospective purchasers, the information required
to be delivered pursuant to Rule 144A(d)(4) under the Securities Act,
unless the Company is then subject to and in compliance with Section
13 or 15(d) of the Exchange Act (the foregoing agreement being for the
benefit of the holders from time to time of the Notes and prospective
purchasers of the Notes designated by such holders);
(f) for a period of three years after the Closing Date,
to furnish to the Initial Purchasers copies of any annual reports,
quarterly reports and current reports filed by the Company with the
Commission on Forms 10-K, 10-Q and 8-K, or such other similar forms as
may be designated by the Commission, and such other documents, reports
and information as shall be furnished by the Company to the Trustee or
to the holders of the Notes pursuant to the Indenture or the Exchange
Act or any rule or regulation of the Commission thereunder;
(g) to use its reasonable best efforts to qualify the
Notes for offering and sale under the state securities or Blue Sky
laws of such jurisdictions as the Initial Purchasers may designate and
to continue such qualifications in effect for so long as reasonably
required for the resale of the Notes; and to arrange for the
determination of the eligibility for investment of the Notes under the
laws of such jurisdictions as the Initial Purchasers may reasonably
request; provided, however, that the Company and its subsidiaries
shall not be obligated to qualify as foreign corporations in any
jurisdiction in which they are not so qualified or to file a general
consent to service of process in any jurisdiction;
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(h) to assist the Initial Purchasers in arranging for the
Notes to be designated Private Offerings, Resales and Trading through
Automated Linkages ("PORTAL") Market securities in accordance with the
rules and regulations adopted by the National Association of
Securities Dealers, Inc. ("NASD") relating to trading in the PORTAL
Market and for the Notes to be eligible for clearance and settlement
through The Depository Trust Company ("DTC");
(i) not to, and to cause its affiliates not to, sell,
offer for sale or solicit offers to buy or otherwise negotiate in
respect of any security (as such term is defined in the Securities
Act) which could be integrated with the sale of the Notes in a manner
which would require registration of the Notes under the Securities
Act;
(j) except following the effectiveness of the Exchange
Offer Registration Statement or the Shelf Registration Statement, as
the case may be, not to, and to cause its affiliates not to, and not
to authorize or knowingly permit any person acting on their behalf to,
solicit any offer to buy or offer to sell the Notes by means of any
form of general solicitation or general advertising within the meaning
of Regulation D or in any manner involving a public offering within
the meaning of Section 4(2) of the Securities Act; and not to offer,
sell, contract to sell or otherwise dispose of, directly or
indirectly, any securities under circumstances where such offer, sale,
contract or disposition would cause the exemption afforded by Section
4(2) of the Securities Act to cease to be applicable to the offering
and sale of the Notes as contemplated by this Agreement and the Final
Offering Memorandum;
(k) for a period of 90 days from the date of the Final
Offering Memorandum, not to offer for sale, sell, contract to sell or
otherwise dispose of, directly or indirectly, or file a registration
statement for, or announce any offer, sale, contract for sale of or
other disposition of any debt securities or guaranteed by the Company
or any of its subsidiaries (other than the Notes) without the prior
written consent of the Initial Purchasers;
(l) without the prior written consent of the Initial
Purchasers, not to resell any of the Notes that have been reacquired
by it, except for Notes purchased by the Company and resold in a
transaction registered under the Securities Act;
(m) in connection with the offering of the Notes, until
CSI on behalf of the Initial Purchasers shall have notified the
Company of the completion of the resale of the Notes, not to, and to
cause its affiliated purchasers (as defined in Regulation M under the
Exchange Act) not to, either alone or with one or more other persons,
bid for or purchase, for any account in which it or any of its
affiliated purchasers has a beneficial interest, any Notes, or attempt
to induce any person to purchase any Notes; and not to, and to cause
its affiliated purchasers not to, make bids or purchase for the
purpose of creating actual, or apparent, active trading in or of
raising the price of the Notes;
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(n) in connection with the offering of the Notes, to make
its officers, independent accountants and legal counsel reasonably
available upon request by the Initial Purchasers;
(o) to do and perform all things required to be done and
performed by it under this Agreement and the Registration Rights
Agreement that are within its control prior to or after the Closing
Date, and to use its reasonable best efforts to satisfy all conditions
precedent to the delivery of the Notes;
(p) to not take any action prior to the execution and
delivery of the Indenture which, if taken after such execution and
delivery, would have violated any of the covenants contained in the
Indenture;
(q) to not take any action prior to the Closing Date
which would require the Final Offering Memorandum to be amended or
supplemented pursuant to Section 4(d);
(r) prior to the Closing Date, not to issue any press
release or other communication directly or indirectly or hold any
press conference with respect to the Company, its condition, financial
or otherwise, or earnings, business affairs or business prospects
(except for routine oral marketing communications in the ordinary
course of business and consistent with the past practices of the
Company and of which the Initial Purchasers are notified), without the
prior written consent of the Initial Purchasers, unless in the
judgment of the Company and its counsel, and after notification to the
Initial Purchasers, such press release or communication is required by
law; and
(s) to apply the net proceeds from the sale of the Notes
as set forth in the Final Offering Memorandum under the heading "Use
of Proceeds."
5. Conditions of Initial Purchasers' Obligations. The
respective obligations of the several Initial Purchasers hereunder are subject
to the accuracy, on and as of the date hereof and the Closing Date, of the
representations and warranties of the Company contained herein, to the accuracy
of the statements of the Company and its officers made in any certificates
delivered pursuant hereto, to the performance by the Company of its obligations
hereunder, and to each of the following additional terms and conditions:
(a) The Final Offering Memorandum (and any amendments or
supplements thereto) shall have been printed and copies distributed to
the Initial Purchasers as promptly as practicable on or following the
date of this Agreement or at such other date and time as to which the
Initial Purchasers may agree; and no stop order suspending the sale of
the Notes in any jurisdiction shall have been issued and no proceeding
for that purpose shall have been commenced or shall be pending or
threatened.
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(b) The Initial Purchasers shall not have discovered and
disclosed to the Company on or prior to the Closing Date that the
Final Offering Memorandum or any amendment or supplement thereto
contains an untrue statement of a fact which, in the opinion of
counsel for the Initial Purchasers, is material or omits to state any
fact which, in the opinion of such counsel, is material and is
required to be stated therein and is necessary to make the statements
therein not misleading.
(c) All corporate proceedings and other legal matters
incident to the authorization, form and validity of each of the
Transaction Documents and the Final Offering Memorandum, and all other
legal matters relating to the Transaction Documents and the
transactions contemplated thereby (including any agreements or
documents executed and delivered in connection therewith), shall be
reasonably satisfactory in all material respects to the Initial
Purchasers, and the Company shall have furnished to the Initial
Purchasers all documents and information that they or their counsel
may reasonably request to enable them to pass upon such matters.
(d) Weil, Gotshal & Xxxxxx LLP shall have furnished to
the Initial Purchasers their written opinion, as counsel to the
Company, addressed to the Initial Purchasers and dated the Closing
Date, substantially to the effect set forth in Annex B hereto.
(e) The Initial Purchasers shall have received from
Xxxxxx Xxxxxx & Xxxxxxx, counsel for the Initial Purchasers, such
opinion or opinions, dated the Closing Date, with respect to such
matters as the Initial Purchasers may reasonably require, and the
Company shall have furnished to such counsel such documents and
information as they reasonably request for the purpose of enabling
them to pass upon such matters.
(f) The Company shall have furnished to the Initial
Purchasers a letter (the "Initial Comfort Letter") of Ernst & Young
LLP, addressed to the Initial Purchasers and dated the date hereof.
(g) The Company shall have furnished to the Initial
Purchasers a letter (the "Bring-Down Comfort Letter") of Ernst & Young
LLP, addressed to the Initial Purchasers and dated the Closing Date,
(i) confirming that they are independent public accountants with
respect to the Company and its subsidiaries within the meaning of Rule
101 of the Code of Professional Conduct of the AICPA and its
interpretations and rulings thereunder, (ii) stating, as of the date
of the Bring-Down Comfort Letter (or, with respect to matters
involving changes or developments since the respective dates as of
which specified financial information is given in the Final Offering
Memorandum,
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as of a date not more than three business days prior to the date of
the Bring-Down Comfort Letter), that the conclusions and findings of
such accountants with respect to the financial information and other
matters covered by the Initial Comfort Letter are accurate and (iii)
confirming in all material respects the conclusions and findings set
forth in the Initial Comfort Letter.
(h) The Company shall have furnished to the Initial
Purchasers on the date hereof copies of the independent accountants'
reports included in the Final Offering Memorandum signed by the
accountants rendering such reports.
(i) The Company shall have furnished to the Initial
Purchasers a certificate, dated the Closing Date, of a senior
executive officer stating that (i) such officer has reviewed the Final
Offering Memorandum, (ii) in his opinion, the Final Offering
Memorandum, as of its date, did not include any untrue statement of a
material fact and did not omit to state a material fact required to be
stated therein or necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading, and since the date of the Final Offering Memorandum, no
event has occurred which should have been set forth in a supplement or
amendment to the Final Offering Memorandum so that the Final Offering
Memorandum (as so amended or supplemented) would not include any
untrue statement of a material fact and would not omit to state a
material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading and (iii) to the best of his
knowledge, as of the Closing Date, the representations and warranties
of the Company in this Agreement are true and correct in all material
respects, the Company has complied in all material respects with all
agreements and satisfied in all material respects all conditions on
its part to be performed or satisfied hereunder on or prior to the
Closing Date, and subsequent to the date of the most recent financial
statements contained in the Final Offering Memorandum, there has been
no material adverse change in the financial position or results of
operations of the Company or any of its subsidiaries, or any material
adverse change, or any material adverse development including a
prospective material adverse change, in or affecting the condition
(financial or otherwise), results of operations, business or prospects
of the Company and its subsidiaries taken as a whole, except as
expressly set forth in the Final Offering Memorandum.
(j) The Initial Purchasers shall have received a
counterpart of the Registration Rights Agreement which shall have been
executed and delivered by a duly authorized officer of the Company.
(k) The Indenture shall have been duly executed and
delivered by the Company and the Trustee, and the Notes shall have
been duly executed and delivered by the Company and duly authenticated
by the Trustee.
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(l) The Notes shall have been approved by the NASD for
trading in the PORTAL Market.
(m) If any event shall have occurred that requires the
Company under Section 4(d) to prepare an amendment or supplement to
the Final Offering Memorandum, such amendment or supplement shall have
been prepared, the Initial Purchaser shall have been given a
reasonable opportunity to comment thereon, and copies thereof shall
have been delivered to the Initial Purchasers reasonably in advance of
the Closing Date.
(n) There shall not have occurred any invalidation of
Rule 144A under the Securities Act by any court or any withdrawal or
proposed withdrawal of any rule or regulation under the Securities Act
or the Exchange Act by the Commission or any amendment or proposed
amendment thereof by the Commission which in the reasonable judgment
of the Initial Purchasers would materially impair the ability of the
Initial Purchasers to purchase, hold or effect resales of the Notes as
contemplated hereby.
(o) Subsequent to the execution and delivery of this
Agreement or, if earlier, the dates as of which the relevant
information is given in the Final Offering Memorandum (exclusive of
any amendment or supplement thereto), other than as described in the
Final Offering Memorandum, there shall not have been any change in the
capital stock or long-term debt or any change, or any development
involving a prospective change, in or affecting the condition
(financial or otherwise), results of operations, business or prospects
of the Company and its subsidiaries taken as a whole, the effect of
which, in any such case described above, is, in the judgment of the
Initial Purchasers, so material and adverse as to make it
impracticable or inadvisable to proceed with the sale or delivery of
the Notes on the terms and in the manner contemplated in this
Agreement and the Final Offering Memorandum (exclusive of any
amendment or supplement thereto).
(p) No action shall have been taken and no statute, rule,
regulation or order shall have been enacted, adopted or issued by any
governmental agency or body which would, as of the Closing Date,
prevent the issuance, sale or resale of the Notes; and no injunction,
restraining order or order of any other nature by any federal or state
court of competent jurisdiction shall have been issued as of the
Closing Date which would prevent the issuance, sale or resale of the
Notes.
(q) Subsequent to the execution and delivery of this
Agreement (i) no downgrading shall have occurred in the rating
accorded the Notes or any other debt securities or preferred stock of
the Company by any "nationally recognized statistical rating
organization," as such term is defined by the Commission for purposes
of Rule 436(g)(2) of the rules and regulations of the Commission under
the Securities Act and (ii) no such organization shall have publicly
announced that it has under surveillance or review (other than an
announcement with positive implications of a possible upgrading), its
rating of the Notes or any of the Company's other debt securities or
preferred stock.
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(r) Subsequent to the execution and delivery of this
Agreement there shall not have occurred any of the following: (i)
trading in securities generally on the New York Stock Exchange, the
American Stock Exchange or the over-the-counter market shall have been
suspended or limited, or minimum prices shall have been established on
any such exchange or market by the Commission, by any such exchange or
by any other regulatory body or governmental authority having
jurisdiction, or trading in any securities of the Company on any
exchange or in the over-the-counter market shall have been suspended,
or (ii) any moratorium on commercial banking activities shall have
been declared by federal or New York state authorities, or (iii) an
outbreak or escalation of hostilities or a declaration by the United
States of a national emergency or war or (iv) a material adverse
change in general economic, political or financial conditions (or the
effect of international conditions on the financial markets in the
United States shall be such) the effect of which, in the case of this
clause (iv), is, in the judgment of the Initial Purchasers, so
material and adverse as to make it impracticable or inadvisable to
proceed with the sale or the delivery of the Notes on the terms and in
the manner contemplated in this Agreement and in the Final Offering
Memorandum (exclusive of any amendment or supplement thereto).
(s) The Initial Purchasers shall have received an
executed original of the Senior Credit Facility.
All opinions, letters, evidence and certificates mentioned
above or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance reasonably
satisfactory to counsel for the Initial Purchasers.
6. Termination. The obligations of the Initial
Purchasers hereunder may be terminated by the Initial Purchasers, in their
absolute discretion, by notice given to and received by the Company prior to
delivery of and payment for the Notes if, prior to that time, any of the events
described in Section 5(r) shall have occurred and be continuing.
7. Defaulting Initial Purchasers. (a) If, on the
Closing Date, either Initial Purchaser defaults in the performance of its
obligations under this Agreement, the non-defaulting Initial Purchaser may make
arrangements for the purchase of the Notes which such defaulting Initial
Purchaser agreed but failed to purchase by other persons satisfactory to the
Company and the non-defaulting Initial Purchaser, but if no such arrangements
are made within 36 hours after such default, this Agreement shall terminate
without liability on the part of the non-defaulting Initial Purchaser or the
Company, except that the Company will continue to be liable for the payment of
expenses to the extent set forth in Sections 8 and 12
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(but only those expenses incurred by the non-defaulting Initial Purchaser) and
except that the provisions of Sections 9 and 10 shall not terminate and shall
remain in effect. As used in this Agreement, the term "Initial Purchasers"
includes, for all purposes of this Agreement unless the context otherwise
requires, any party not listed in Schedule I hereto that, pursuant to this
Section 7, purchases Notes which a defaulting Initial Purchaser agreed but
failed to purchase.
(b) Nothing contained herein shall relieve a defaulting
Initial Purchaser of any liability it may have to the Company or any
non-defaulting Initial Purchaser for damages caused by its default. If other
persons are obligated or agree to purchase the Notes of a defaulting Initial
Purchaser, either the non-defaulting Initial Purchaser or the Company may
postpone the Closing Date for up to seven full business days in order to effect
any changes that in the opinion of counsel for the Company or counsel for the
Initial Purchasers may be necessary in the Final Offering Memorandum or in any
other document or arrangement, and the Company agrees to reasonably promptly
prepare any amendment or supplement to the Final Offering Memorandum that
effects any such changes.
8. Reimbursement of Initial Purchasers' Expenses. If
(a) this Agreement shall have been terminated pursuant to Section 6 or 7, (b)
the Company shall fail to tender the Notes for delivery to the Initial
Purchasers for any reason permitted under this Agreement or (c) the Initial
Purchasers shall decline to purchase the Notes for any reason permitted under
this Agreement, the Company shall reimburse the Initial Purchasers for such
out-of- pocket expenses (including reasonable fees and disbursements of
counsel) as shall have been reasonably incurred by the Initial Purchasers in
connection with this Agreement and the proposed purchase and resale of the
Notes. If this Agreement is terminated pursuant to Section 7 by reason of the
default of one or more of the Initial Purchasers, the Company shall not be
obligated to reimburse any defaulting Initial Purchaser on account of such
expenses.
9. Indemnification. (a) The Company shall indemnify
and hold harmless each Initial Purchaser, its affiliates, any person
controlling such Initial Purchaser or such affiliates within the meaning of the
Securities Act or Exchange Act and each of their respective officers,
directors, partners, employees, representatives, affiliates and agents,
(collectively referred to for purposes of this Section 9(a) and Section 10 as
an "Initial Purchaser"), from and against any loss, claim, damage or liability,
joint or several, or any action in respect thereof (including, without
limitation, any loss, claim, damage, liability or action relating to purchases
and sales of the Notes), to which such Initial Purchaser may become subject,
whether commenced or threatened, under the Securities Act, the Exchange Act,
any other federal or state statutory law or regulation, at common law or
otherwise, insofar as such loss, claim, damage, liability or action arises out
of, or is based upon, (i) any untrue statement or alleged untrue statement of a
material fact contained in the Preliminary Offering Memorandum or the Final
Offering Memorandum or in any amendment or supplement thereto or in any
information provided by the Company pursuant to Section 4(e) or (ii) the
omission or alleged omission to state therein a material fact necessary in
order to make the statements therein, in the light of
24
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the circumstances under which they were made, not misleading, and shall
reimburse each Initial Purchaser promptly upon demand for any legal or other
expenses reasonably incurred by such Initial Purchaser in connection with
investigating or defending or preparing to defend against or appearing as a
third party witness in connection with any such loss, claim, damage, liability
or action as such expenses are incurred; provided, however, that the Company
shall not be liable in any such case to the extent that any such loss, claim,
damage, liability or action arises out of, or is based upon, an untrue
statement or alleged untrue statement in or omission or alleged omission from
any of such documents in reliance upon and in conformity with any Initial
Purchaser's Information; and provided, further, that with respect to any such
untrue statement in or omission from the Preliminary Offering Memorandum, the
indemnity agreement contained in this Section 9(a) shall not inure to the
benefit of an Initial Purchaser to the extent that the sale to the person
asserting any such loss, claim, damage, liability or action was an initial
resale by the Initial Purchaser and any such loss, claim, damage, liability or
action of or with respect to such Initial Purchaser results from the fact that
both (A) a copy of the Final Offering Memorandum was not sent or given to such
person at or prior to the written confirmation of the sale of such Notes to
such person and (B) the untrue statement in or omission from the Preliminary
Offering Memorandum was corrected in the Final Offering Memorandum unless, in
either case, such failure to deliver the Final Offering Memorandum was a result
of non-compliance by the Company with Section 4(b).
(b) Each Initial Purchaser, severally and not jointly, shall
indemnify and hold harmless the Company, its affiliates, any person controlling
the Company or such affiliates within the meaning of the Securities Act or
Exchange Act and each of their respective officers, directors, partners,
employees, representatives, affiliates and agents, (collectively referred to
for purposes of this Section 9(b) and Section 10 as the Company), from and
against any loss, claim, damage or liability, joint or several, or any action
in respect thereof, to which the Company may become subject, whether commenced
or threatened, under the Securities Act, the Exchange Act, any other federal or
state statutory law or regulation, at common law or otherwise, insofar as such
loss, claim, damage, liability or action arises out of, or is based upon, (i)
any untrue statement or alleged untrue statement of a material fact contained
in the Preliminary Offering Memorandum or the Final Offering Memorandum or in
any amendment or supplement thereto or (ii) the omission or alleged omission to
state therein a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, but in each case only to the extent that the untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with any Initial Purchaser's Information, and shall
reimburse the Company promptly upon demand for any legal or other expenses
reasonably incurred by the Company in connection with investigating or
defending or preparing to defend against or appearing as a third party witness
in connection with any such loss, claim, damage, liability or action as such
expenses are incurred.
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(c) Promptly after receipt by an indemnified party under this
Section 9 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against
the indemnifying party pursuant to Section 9(a) or 9(b), notify the
indemnifying party in writing of such claim or the commencement of such action;
provided, however, that the failure to notify the indemnifying party shall not
relieve it from any liability which it may have under this Section 9 except to
the extent that it has been materially prejudiced (through the forfeiture of
substantive rights or defenses) by such failure; and provided, further, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have to an indemnified party otherwise than under this
Section 9. If any such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to assume
the defense thereof with counsel reasonably satisfactory to the indemnified
party. After notice from the indemnifying party to the indemnified party of
its election to assume the defense of such claim or action, the indemnifying
party shall not be liable to the indemnified party under this Section 9 for any
legal or other expenses subsequently incurred by the indemnified party in
connection with the defense thereof other than reasonable costs of
investigation; provided, however, that an indemnified party shall have the
right to employ its own counsel in any such action, but the fees, expenses and
other charges of such counsel for the indemnified party will be at the expense
of such indemnified party unless (1) the employment of counsel by the
indemnified party has been authorized in writing by the indemnifying party, (2)
a conflict or potential conflict exists (based upon advice of counsel to the
indemnified party) between the indemnified party and the indemnifying party (in
which case the indemnifying party will not have the right to direct the defense
of such action on behalf of the indemnified party) or (3) the indemnifying
party has not in fact employed counsel reasonably satisfactory to the
indemnified party to assume the defense of such action within a reasonable time
after receiving notice of the commencement of the action, in each of which
cases the reasonable fees, disbursements and other charges of counsel will be
at the expense of the indemnifying party or parties. It is understood that the
indemnifying party or parties shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the reasonable
fees, disbursements and other charges of more than one separate firm of
attorneys (in addition to any local counsel) at any one time for all such
indemnified party or parties. Each indemnified party, as a condition of the
indemnity agreements contained in Sections 9(a) and 9(b), shall use all
reasonable efforts to cooperate with the indemnifying party in the defense of
any such action or claim. No indemnifying party shall be liable for any
settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its written
consent or if there be a final judgment for the plaintiff in any such action,
the indemnifying party agrees to indemnify and hold harmless any indemnified
party from and against any loss or liability by reason of such settlement or
judgment. No indemnifying party shall, without the prior written consent of
the indemnified party (which consent shall not be unreasonably withheld),
effect any settlement of any pending or
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threatened proceeding in respect of which any indemnified party is a party and
indemnity could have been sought hereunder by such indemnified party unless
such settlement includes an unconditional release of such indemnified party in
form and substance satisfactory to such indemnified party from all liability on
claims that are the subject matter of such proceeding.
The obligations of the Company and the Initial Purchasers in
this Section 9 and in Section 10 are in addition to any other liability that
the Company or the Initial Purchasers, as the case may be, may otherwise have.
10. Contribution. If the indemnification provided for in
Section 9 is unavailable or insufficient to hold harmless an indemnified party
under Section 9(a) or 9(b), then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or payable
by such indemnified party as a result of such loss, claim, damage or liability,
or action in respect thereof, (i) in such proportion as shall be appropriate to
reflect the relative benefits received by the Company on the one hand and the
Initial Purchasers on the other from the offering of the Notes or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company on
the one hand and the Initial Purchasers on the other with respect to the
statements or omissions that resulted in such loss, claim, damage or liability,
or action in respect thereof, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Initial Purchasers on the other with respect to such offering shall be
deemed to be in the same proportion as the total net proceeds from the offering
of the Notes purchased under this Agreement (before deducting expenses)
received by or on behalf of the Company, on the one hand, and the total
discounts and commissions received by the Initial Purchasers with respect to
the Notes purchased under this Agreement, on the other, bear to the total gross
proceeds from the sale of the Notes under this Agreement, in each case as set
forth in the table on the cover page of the Final 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 the Company or information
supplied by the Company on the one hand or to any Initial Purchaser's
Information on the other, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission. The Company and the Initial Purchasers agree
that it would not be just and equitable if contributions pursuant to this
Section 10 were to be determined by pro rata allocation or by any other method
of allocation that does not take into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as a
result of the loss, claim, damage or liability, or action in respect thereof,
referred to above in this Section 10 shall be deemed to include, for purposes
of this Section 10, any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending or preparing to
defend any such action or claim. Notwithstanding the provisions of this
Section 10,
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no Initial Purchaser shall be required to contribute any amount in excess of
the amount by which the total discounts and commissions received by such
Initial Purchaser with respect to the Notes purchased by it under this
Agreement exceeds the amount of any damages which such Initial Purchaser has
otherwise paid or become liable to pay by reason of any untrue or alleged
untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Initial Purchasers'
obligations to contribute as provided in this Section 10 are several in
proportion to their respective purchase obligations and not joint.
11. Persons Entitled to Benefit of Agreement. This
Agreement shall inure to the benefit of and be binding upon the Initial
Purchasers and the Company and their respective successors. This Agreement and
the terms and provisions hereof are for the sole benefit of only those persons,
except as provided in Sections 9 and 10 with respect to affiliates, controlling
persons, officers, directors, partners, employees, representatives and agents
as specified therein and in Section 4(e) with respect to holders and
prospective purchasers of the Notes. Nothing in this Agreement is intended or
shall be construed to give any person, other than the persons referred to in
this Section 11, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision contained herein.
12. Expenses. Whether or not the transactions
contemplated by this Agreement are consummated or this Agreement is terminated,
the Company agrees with the Initial Purchasers to pay (a) the costs incident to
the authorization, issuance, sale, preparation and delivery of the Notes and
any taxes payable in that connection; (b) the costs incident to the
preparation, printing and distribution of the Preliminary Offering Memorandum,
the Final Offering Memorandum and any amendments or supplements thereto; (c)
the costs of reproducing and distributing each of the Transaction Documents;
(d) the costs incident to the preparation, printing and delivery of the
certificates evidencing the Notes, including stamp duties and transfer taxes,
if any, payable upon issuance of the Notes; (e) the fees and expenses of the
Company's counsel and independent accountants; (f) the fees and expenses of
qualifying the Notes under the securities laws of the several jurisdictions as
provided in Section 4(g) and of preparing, printing and distributing Blue Sky
Memoranda (including related fees and expenses of counsel for the Initial
Purchasers in an amount up to $7,500); (g) any fees charged by rating agencies
for rating the Notes; (h) the fees and expenses of the Trustee and any paying
agent (including related fees and expenses of any counsel to such parties); (i)
all expenses and application fees incurred in connection with the application
for the inclusion of the Notes on the PORTAL Market and the approval of the
Notes for book-entry transfer by DTC; and (j) all other costs and expenses
incident to the performance of the obligations of the Company under this
Agreement which are not otherwise specifically provided for in this Section 12;
provided, however, that except as provided in this Section 12 and Section 8,
the Initial Purchasers shall pay their own costs and expenses (including the
costs and expenses of their legal counsel).
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13. Survival. The respective indemnities, rights of
contribution, representations, warranties and agreements of the Company and the
Initial Purchasers contained in this Agreement or made by or on behalf of the
Company or the Initial Purchasers pursuant to this Agreement shall survive the
delivery of and payment for the Notes and shall remain in full force and
effect, regardless of any termination or cancellation of this Agreement or any
investigation made by or on behalf of any of them.
14. Notices, etc.. All statements, requests, notices and
agreements hereunder shall be in writing, and:
(a) if to the Initial Purchasers, shall be delivered or
sent by mail or telecopy transmission to Chase Securities Inc., 000
Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxx Xxxxx
(telecopier no.: (000) 000-0000); or
(b) if to the Company, shall be delivered or sent by mail
or telecopy transmission to the address of the Company set forth in
the Final Offering Memorandum, Attention: Xxxxx X. Xxxxxx (telecopier
no.: (000) 000-0000), with a copy to Hicks, Muse, Xxxx & Xxxxx
Incorporated, 000 Xxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxx, Xxxxx 00000,
Attention: Xxxxxxxx X. Xxxxxx, Xx. (telecopier no.: (000) 000-0000).
provided that any notice to an Initial Purchaser pursuant to Section 9(c) shall
also be delivered or sent by mail to such Initial Purchaser at its address set
forth on the signature page hereof. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof. The Company shall
be entitled to act and rely upon any request, consent, notice or agreement
given or made on behalf of the Initial Purchasers by CSI.
15. Definition of Terms. For purposes of this Agreement,
(a) the term "business day" means any day on which the New York Stock Exchange,
Inc. is open for trading, (b) the term "subsidiary" has the meaning set forth
in Rule 405 under the Securities Act and (c) except where otherwise expressly
provided, the term "affiliate" has the meaning set forth in Rule 405 under the
Securities Act.
16. Initial Purchasers' Information. The parties hereto
acknowledge and agree that for all purposes of this Agreement (including, but
not limited to, Section 1(a), Section 9 and Section 10) the Initial Purchasers'
Information consists solely of the following information in the Preliminary
Offering Memorandum and the Final Offering Memorandum: (i) the last paragraph
on the front cover page concerning the terms of the offering by the Initial
Purchasers; (ii) the first paragraph on page "i" concerning stabilization,
over-allotment and trading activities by the Initial Purchasers; and (iii) the
statements concerning each of the Initial Purchasers (but only as to such
Initial Purchaser) contained in the third, fifth, ninth, eleventh and twelfth
paragraphs under the heading "Plan of Distribution."
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17. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAWS THEREOF.
18. Counterparts. This Agreement may be executed in one
or more counterparts (which may include counterparts delivered by telecopier)
and, if executed in more than one counterpart, the executed counterparts shall
each be deemed to be an original, but all such counterparts shall together
constitute one and the same instrument.
19. Amendments. No amendment or waiver of any provision
of this Agreement, nor any consent or approval to any departure therefrom,
shall in any event be effective unless the same shall be in writing and signed
by the parties hereto.
20. Headings. The headings herein are inserted for
convenience of reference only and are not intended to be part of, or to affect
the meaning or interpretation of, this Agreement.
[Signature Pages Follow]
30
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us a counterpart hereof, whereupon this
instrument will become a binding agreement between each of the Company and the
Initial Purchasers in accordance with its terms.
Very truly yours,
COOPERATIVE COMPUTING, INC.
By: /s/ XXXXXXX XXXX
--------------------------------
Name: Xxxxxxx Xxxx
Title: Chief Financial Officer
Accepted:
CHASE SECURITIES INC.
By: /s/ XXXXX XXXXX
-----------------------------------------
Authorized Signatory
Address for notices pursuant to Section 9(c):
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Legal Department
NATIONSBANC XXXXXXXXXX
SECURITIES LLC
By: /s/ XXXXXX X. XXXXXXXXXXXX
-----------------------------------------
Authorized Signatory
Address for notices pursuant to Section 9(c):
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000
Attention: Legal Department
