Exhibit 1(b)
2,200,000 Shares
FURNITURE BRANDS INTERNATIONAL, INC.
Common Stock
FORM OF INTERNATIONAL UNDERWRITING AGREEMENT
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June [ ], 1997
XXXXX XXXXXX INC.
CREDIT SUISSE FIRST BOSTON (EUROPE) LIMITED
XXXXXX, READ & CO. INC.
XXXXXXX XXXXX INTERNATIONAL
SALOMON BROTHERS INTERNATIONAL LIMITED
WHEAT, FIRST SECURITIES, INC.
As Lead Managers for the Several Managers
c/o XXXXX XXXXXX INC.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Certain stockholders named in Schedule II hereto (the "Selling
Stockholders") of Furniture Brands International, Inc. (the "Company"), propose
to sell an aggregate of 2,200,000 shares (the "Shares") of the common stock, no
par value per share of the Company (the "Common Stock"), to the several Managers
named in Schedule I hereto (the "Managers").
It is understood that the Company and the Selling Stockholders are
currently entering into a U.S. Underwriting Agreement, dated the date hereof
(the "U.S. Underwriting Agreement"), providing for the sale of 8,800,000 shares
of the Common Stock by the Selling Stockholders (the "U.S. Shares"), through
arrangements with certain underwriters in the United States and Canada (the
"U.S. Underwriters"), for whom Xxxxx Xxxxxx Inc., Credit Suisse First Boston
Corporation, Xxxxxx, Read & Co. Inc., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated, Salomon Brothers Inc. and Wheat, First Securities, Inc. are acting
as representatives (the "Representatives"). The Shares and the U.S. Shares,
collectively, are herein called the "Underwritten Shares".
The Company and the Selling Stockholders also understand that the Lead
Managers and the Representatives have entered into an agreement (the "Agreement
Between U.S. Underwriters and Managers") contemplating the coordination of
certain transactions between the Managers and the U.S. Underwriters and that,
pursuant thereto and subject to the conditions set forth therein, the Managers
may purchase from the U.S. Underwriters a portion of the U.S. Shares or sell to
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the U.S. Underwriters a portion of the Shares. The Company and the Selling
Stockholders understand that any such purchases and sales between the Managers
and the U.S. Underwriters shall be governed by the Agreement Between U.S.
Underwriters and Managers and shall not be governed by the terms of this
Agreement or the U.S. Underwriting Agreement.
The Company and the Selling Stockholders wish to confirm as follows
their respective agreements with you (the "Lead Managers") and the other several
Managers on whose behalf you are acting, in connection with the several
purchases of the Shares by the Managers.
1. Registration Statement and Prospectus. The Company has prepared and
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filed with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations of the Commission thereunder (collectively, the
"Act"), a registration statement on Form S-3 under the Act (the "registration
statement"), including a prospectus subject to completion relating to the
Underwritten Shares. The term "Registration Statement" as used in this
Agreement means the registration statement (including all financial schedules
and exhibits), as amended at the time it becomes effective, or, if the
registration statement became effective prior to the execution of this
Agreement, as supplemented or amended prior to the execution of this Agreement.
If it is contemplated, at the time this Agreement is executed, that a post-
effective amendment to the registration statement will be filed and must be
declared effective before the offering of the Shares may commence, the term
"Registration Statement" as used in this Agreement means the registration
statement as amended by said post-effective amendment. If an abbreviated
registration statement is prepared and filed with the Commission in accordance
with Rule 462(b) under the Act ("a Rule 462(b) Registration Statement"), the
term "Registration Statement" as used in this Agreement includes the Rule 462(b)
Registration Statement. The term "Prospectuses" as used in this Agreement means
the prospectuses in the form included in the Registration Statement, or, if the
prospectuses included in the Registration Statement omit information in reliance
on Rule 430A under the Act and such information is included in prospectuses
filed with the Commission pursuant to Rule 424(b) under the Act, the term
"Prospectuses" as used in this Agreement means the prospectuses in the form
included in the Registration Statement as supplemented by the addition of the
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Rule 430A information contained in the prospectuses filed with the Commission
pursuant to Rule 424(b). The term "Prepricing Prospectuses" as used in this
Agreement means the prospectuses subject to completion in the form included in
the registration statement at the time of the initial filing of the registration
statement with the Commission, and as such prospectuses shall have been amended
from time to time prior to the date of the Prospectuses. Any reference in this
Agreement to the registration statement, the Registration Statement, any
Prepricing Prospectus or the Prospectuses shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to Item 12 of
Form S-3 under the Act, as of the date of the registration statement, the
Registration Statement, such Prepricing Prospectus or the Prospectuses, as the
case may be, and any reference to any amendment or supplement to the
registration statement, the Registration Statement, any Prepricing Prospectus or
the Prospectuses shall be deemed to refer to and include any documents filed
after such date under the Securities Exchange Act of 1934, as amended (the
"Exchange Act") which, upon filing, are incorporated by reference therein, as
required by paragraph (b) of Item 12 of Form S-3. As used herein, the term
"Incorporated Documents" means the documents which at the time are incorporated
by reference in the registration statement, the Registration Statement, any
Prepricing Prospectus, the Prospectuses, or any amendment or supplement thereto.
It is understood that two forms of Prepricing Prospectus and two forms
of Prospectus are to be used in connection with the offering and sale of the
Underwritten Shares: a Prepricing Prospectus and a Prospectus relating to the
Shares that are to be offered and sold outside the United States (as defined
herein) or Canada (as defined herein) to persons other than U.S. or Canadian
Persons (the "International Prepricing Prospectus" and the "International
Prospectus", respectively), and a Prepricing Prospectus and a Prospectus
relating to the U.S. Shares which are to be offered and sold in the United
States and Canada to U.S. or Canadian Persons (the "U.S. Prepricing Prospectus"
and the "U.S. Prospectus", respectively). The International Prospectus and the
U.S. Prospectus are herein collectively called the "Prospectuses," and the
International Prepricing Prospectus and the U.S. Prepricing Prospectus are
herein collectively called the "Prepricing Prospectuses". For purposes of this
Agreement: "U.S. or Canadian Person" means any resident or national of the
United States or Canada, any corporation, partnership or other entity created or
organized in or under the laws of the United States or Canada or any estate or
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trust the income of which is subject to United States or Canadian income
taxation regardless of the source of its income (other than the foreign branch
of any U.S. or Canadian Person), and includes any United States or Canadian
branch of a person other than a U.S. or Canadian Person; "United States" means
the United States of America (including the states thereof and the District of
Columbia) and its territories, its possessions and other areas subject to its
jurisdiction; and "Canada" means Canada and its territories, its possessions and
other areas subject to its jurisdiction.
2. Agreements to Sell and Purchase. Subject to such adjustments as you
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may determine in order to avoid fractional shares, each Selling Stockholder
agrees, severally and not jointly, subject to all the terms and conditions set
forth herein, to sell to each Manager and, upon the basis of the
representations, warranties and agreements of the Company and the Selling
Stockholders herein contained and subject to all the terms and conditions set
forth herein, each Manager, severally and not jointly, agrees to purchase from
each Selling Stockholder at a price per share of $[ ] (the "purchase price
per share") the number of Shares which bears the same proportion to the number
of Shares set forth opposite the name of such Selling Stockholder in Schedule II
hereto as the number of Shares set forth opposite the name of such Manager in
Schedule I hereto (or such number of Shares increased as set forth in Section 12
hereof) bears to the aggregate number of Shares to be sold by the Selling
Stockholders.
Each Manager represents, warrants, covenants and agrees that, except
as contemplated under Section 2 of the Agreement Between U.S. Underwriters and
Managers dated the date hereof (as described in the Prospectuses under
"Underwriting"), (i) it is not purchasing any Shares for the account of a U.S.
or Canadian Person and (ii) it has not offered or sold, and will not offer,
sell, resell or deliver, directly or indirectly, any Shares or distribute any
International Prospectus in the United States or Canada or to a U.S. or Canadian
Person.
3. Terms of Public Offering. The Company and the Selling Stockholders
------------------------
have been advised by you that the Managers propose to make a public offering of
their respective portions of the Shares as soon after the Registration Statement
and this Agreement have become effective as in your judgment is advisable and
initially to offer the Shares upon the terms set forth in the International
Prospectus.
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4. Delivery of the Shares and Payment Therefor. Delivery to the Managers
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of and payment for the Shares shall be made at the office of Xxxxx Xxxxxx Inc.,
000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, XX 00000, at 10:00 A.M., New York City time, on
June [ ], 1997 (the "Closing Date"). The place of closing for the Shares and
the Closing Date may be varied by agreement among you, the Company and the
Selling Stockholders.
Certificates for the Shares shall be registered in such names and in
such denominations as you shall request prior to 9:30 A.M., New York City time,
on the second business day preceding the Closing Date. Such certificates shall
be made available to you in New York City for inspection and packaging not later
than 9:30 A.M., New York City time, on the business day next preceding the
Closing Date. The certificates evidencing the Shares and shall be delivered to
you on the Closing Date, against payment of the purchase price therefor in
immediately available funds.
5. Agreements of the Company. The Company agrees with the several
-------------------------
Managers as follows:
(a) If, at the time this Agreement is executed and delivered, it is
necessary for the Registration Statement or a post-effective amendment thereto
or any Rule 462(b) Registration Statement to be declared effective before the
offering of the Shares may commence, the Company will endeavor to cause the
Registration Statement or such post-effective amendment to become effective as
soon as possible and will advise you promptly and, if requested by you, will
confirm such advice in writing, when the Registration Statement or such post-
effective amendment has become effective.
(b) The Company will advise you promptly and, if requested by you,
will confirm such advice in writing: (i) of any request by the Commission for
amendment of or a supplement to the Registration Statement, any Prepricing
Prospectus or the Prospectuses or for additional information; (ii) of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of the suspension of qualification of the Shares for
offering or sale in any jurisdiction or the initiation of any proceeding for
such purpose; and (iii) within the period of time referred to in paragraph (f)
below, of any change in the Company's condition (financial or other), business,
prospects, properties, net worth or results of operations, or of the happening
of any event, which makes any statement of a material fact made in the
Registration Statement or the Prospectuses (as then amended or supplemented)
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untrue or which requires the making of any additions to or changes in the
Registration Statement or the Prospectuses (as then amended or supplemented) in
order to state a material fact required by the Act or the regulations thereunder
to be stated therein or necessary in order to make the statements therein not
misleading, or of the necessity to amend or supplement the Prospectuses (as then
amended or supplemented) to comply with the Act or any other law. If at any
time the Commission shall issue any stop order suspending the effectiveness of
the Registration Statement, the Company will make every reasonable effort to
obtain the withdrawal of such order at the earliest possible time.
(c) The Company will furnish to you, without charge (i) six copies of
the registration statement as originally filed with the Commission and of each
amendment thereto, including financial statements and all exhibits to the
Registration Statement, and of any Rule 462(b) Registration Statement and any
amendment thereto, (ii) such number of conformed copies of the Registration
Statement as originally filed and of each amendment thereto, but without
exhibits, as you may reasonably request, (iii) such number of copies of the
Incorporated Documents, without exhibits, and of any Rule 462(b) Registration
Statement and any amendment thereto, as you may reasonably request, and (iv) six
copies of the exhibits to the Incorporated Documents.
(d) The Company will not file any amendment to the Registration
Statement, any Rule 462(b) Registration Statement or amendment thereto, or make
any amendment or supplement to the Prospectuses or, prior to the end of the
period of time referred to in the first sentence in subsection (f) below, file
any document which, upon filing becomes an Incorporated Document, of which you
shall not previously have been advised or to which, after you shall have
received a copy of the document proposed to be filed, you shall reasonably
object.
(e) Prior to the execution and delivery of this Agreement, the Company
has delivered to you, without charge, in such quantities as you have requested,
copies of each form of the International Prepricing Prospectus. The Company
consents to the use, in accordance with the provisions of the Act and with the
securities laws of the jurisdictions in which the Shares are offered by the
several Managers and by dealers, prior to the date of the International
Prospectus, of each International Prepricing Prospectus so furnished by the
Company.
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(f) As soon after the execution and delivery of this Agreement as
possible and thereafter from time to time for such period as in the opinion of
counsel for the Managers a prospectus is required by the Act to be delivered in
connection with sales by any Manager or dealer, the Company will expeditiously
deliver to each Manager and each dealer, without charge, as many copies of the
International Prospectus (and of any amendment or supplement thereto) as you may
reasonably request. The Company consents to the use of the International
Prospectus (and of any amendment or supplement thereto) in accordance with the
provisions of the Act and with the securities laws of the jurisdictions in which
the Shares are offered by the several Managers and by all dealers to whom Shares
may be sold, both in connection with the offering and sale of the Shares and for
such period of time thereafter as the International Prospectus is required by
the Act to be delivered in connection with sales by any Manager or dealer. If
during such period of time any event shall occur that in the judgment of the
Company or in the opinion of counsel for the Managers is required to be set
forth in the International Prospectus (as then amended or supplemented) or
should be set forth therein in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, or if it
is necessary to supplement or amend the International Prospectus (or to file
under the Exchange Act any document which, upon filing, becomes an Incorporated
Document) in order to comply with the Act or any other law, the Company will
forthwith prepare and, subject to the provisions of paragraph (d) above, file
with the Commission an appropriate supplement or amendment thereto (or to such
document), and will expeditiously furnish to the Managers and dealers a
reasonable number of copies thereof. In the event that the Company and you, as
Lead Managers for the several Managers, agree that the International Prospectus
should be amended or supplemented, the Company, if requested by you, will
promptly issue a press release announcing or disclosing the matters to be
covered by the proposed amendment or supplement.
(g) The Company will cooperate with you and with counsel for the
Managers in connection with the registration or qualification of the Shares for
offering and sale by the several Managers and by dealers under the securities
laws of such jurisdictions as you may designate and will file such consents to
service of process or other documents necessary or appropriate in order to
effect such registration or qualification; provided that in no event shall the
Company be obligated to qualify to do business in any jurisdiction where it is
not now so qualified or to take any action which would subject it to service of
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process in suits, other than those arising out of the offering or sale of the
Shares, in any jurisdiction where it is not now so subject.
(h) The Company will make generally available to its security holders
a consolidated earnings statement, which need not be audited, covering the
period specified by Section 11(a) of the Act and Rule 158 thereunder, as soon as
reasonably practicable, which consolidated earnings statement shall satisfy the
provisions of Section 11(a) of the Act and Rule 158 thereunder.
(i) During the period of five years hereafter, the Company will
furnish to you (i) upon your request, at such address as you may specify, as
soon as available, a copy of each report of the Company mailed to stockholders
or filed with the Commission, and (ii) from time to time such other information
concerning the Company as you may reasonably request.
(j) If this Agreement shall terminate or shall be terminated after
execution pursuant to any provisions hereof (otherwise than pursuant to the
second paragraph of Section 12 hereof or by notice given by you terminating this
Agreement pursuant to Section 12 or Section 13 hereof) or if this Agreement
shall be terminated by the Managers because of any failure or refusal on the
part of the Company or any of the Selling Stockholders to comply with the terms
or fulfill any of the conditions of this Agreement, the Company agrees to
reimburse the Lead Managers for all out-of-pocket expenses (including reasonable
fees and expenses of counsel for the Managers) incurred by you in connection
herewith.
(k) If Rule 430A of the Act is employed, the Company will timely file
the Prospectuses pursuant to Rule 424(b) under the Act and will advise you of
the time and manner of such filing.
(l) Except as provided in this Agreement, the Company will not sell,
contract to sell or otherwise dispose of any Common Stock (except shares issued
upon exercises of options outstanding under the Company's 1992 stock option plan
or upon exercise of outstanding warrants) or any securities convertible into or
exercisable or exchangeable for Common Stock, or grant any options (except any
options granted under the Company's 1992 stock option plan) or warrants to
purchase Common Stock, for a period of 90 days after the date of the
International Prospectus, without the prior written consent of Xxxxx Xxxxxx Inc.
(m) The Company has furnished or will furnish to you "lock-up"
letters, in form and substance satisfactory to you, signed by each of its
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current officers and directors listed on Schedule III hereto.
(n) Except as stated in this Agreement and in the Prepricing
Prospectuses and Prospectuses, the Company has not taken, nor will it take,
directly or indirectly, any action designed to or that might reasonably be
expected to cause or result in stabilization or manipulation of the price of the
Common Stock to facilitate the sale or resale of the Shares.
(o) The Company will use all reasonable efforts to satisfy on or
before the Closing Date all conditions to the Managers' obligations to purchase
the Shares.
6. Agreements of the Selling Stockholders. Each of the Selling
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Stockholders agrees with the several Managers as follows:
(a) Such Selling Stockholder will cooperate to the extent necessary
to cause the registration statement or any post-effective amendment thereto to
become effective at the earliest possible time.
(b) Such Selling Stockholder will pay all Federal and other taxes, if
any, on the transfer or sale of such Shares that are sold by the Selling
Stockholder to the Managers.
(c) Such Selling Stockholder will do or perform all things required
to be done or performed by the Selling Stockholder prior to the Closing Date to
satisfy all conditions precedent to the delivery of the Shares pursuant to this
Agreement.
(d) Except as provided in this Agreement and in the lock-up letter
referred to in paragraph (e) below, such Selling Stockholder will not sell or
otherwise dispose of any Common Stock for a period of 90 days after the date of
the International Prospectus, without the prior written consent of Xxxxx Xxxxxx
Inc.
(e) Such Selling Stockholder has furnished or will furnish to you a
"lock-up" letter, in form and substance satisfactory to you.
(f) Except as stated in this Agreement and the U.S. Underwriting
Agreement and in the Prepricing Prospectuses and the Prospectuses, such Selling
Stockholder has not taken, nor will it take, directly or indirectly, any action
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designed to or that might reasonably be expected to cause or result in
stabilization or manipulation of the price of the Common Stock to facilitate the
sale or resale of the Shares.
7. Representations and Warranties of the Company. The Company represents
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and warrants to each Manager and to the Selling Stockholders that:
(a) Each International Prepricing Prospectus included as part of the
registration statement as originally filed or as part of any amendment or
supplement thereto, or filed pursuant to Rule 424 under the Act, complied when
so filed in all material respects with the provisions of the Act; except that
this representation and warranty does not apply to statements in or omissions
from such International Prepricing Prospectus (or any amendment or supplement
thereto) made in reliance upon and in conformity with information relating to
any Selling Stockholder or to any Manager or U.S. Underwriter furnished to the
Company in writing by a Manager through the Lead Managers or by a U.S.
Underwriter through the Representatives or by a Selling Stockholder expressly
for use therein. The Commission has not issued any order preventing or
suspending the use of any Prepricing Prospectus.
(b) The Company and the transactions contemplated by this Agreement
meet the requirements for using Form S-3 under the Act. The registration
statement in the form in which it became or becomes effective and also in such
form as it may be when any post-effective amendment thereto or any Rule 462(b)
Registration Statement or amendment thereto shall become effective and the
International Prospectus and any supplement or amendment thereto when filed with
the Commission under Rule 424(b) under the Act, complied or will comply in all
material respects with the provisions of the Act and will not at any such times
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading; except that this representation and warranty does not apply to
statements in or omissions from the Registration Statement or the International
Prospectus made in reliance upon and in conformity with information relating to
any Selling Stockholder or to any Manager or U.S. Underwriter furnished to the
Company in writing by a Manager through the Lead Managers or by a U.S.
Underwriter through the Representatives or by a Selling Stockholder expressly
for use therein.
(c) The Incorporated Documents included in the Registration Statement
heretofore filed, when they were filed (or, if any amendment with respect to any
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such document was filed, when such amendment was filed), conformed in all
material respects with the requirements of the Exchange Act and the rules and
regulations thereunder, and any further Incorporated Documents so filed will,
when they are filed, conform in all material respects with the requirements of
the Exchange Act and the rules and regulations thereunder; no such document when
it was filed (or, if an amendment with respect to any such document was filed,
when such amendment was filed), contained an untrue statement of a material fact
or omitted to state a material fact required to be stated therein or necessary
in order to make the statements therein not misleading; and no such further
document, when it is filed, will contain an untrue statement of a material fact
or will omit to state a material fact required to be stated therein or necessary
in order to make the statements therein not misleading.
(d) All the outstanding shares of Common Stock of the Company,
including the Underwritten Shares, have been duly authorized and validly issued,
are fully paid and nonassessable and are free of any preemptive or similar
rights; and the capital stock of the Company conforms to the description thereof
in the Registration Statement and the Prospectuses.
(e) The Company is a corporation duly organized and validly existing
in good standing under the laws of the State of Delaware with full corporate
power and authority to own, lease and operate its properties and to conduct its
business as described in the Registration Statement and the Prospectuses, and is
duly registered and qualified to conduct its business and is in good standing in
each jurisdiction or place where the nature of its properties or the conduct of
its business requires such registration or qualification, except where the
failure so to register or qualify does not, individually or in the aggregate,
have a material adverse effect on the condition (financial or other), business,
properties, net worth or results of operations of the Company and the
Subsidiaries (as hereinafter defined) taken as a whole (a "Material Adverse
Effect").
(f) All the Company's subsidiaries (collectively, the "Subsidiaries")
are listed in an exhibit to the Company's Annual Report on Form 10-K which is
incorporated by reference into the Registration Statement (except for certain
immaterial subsidiaries formed since the filing thereof). Each of Action
Industries, Inc., Broyhill Furniture Industries, Inc., The Lane Company,
Incorporated, and Thomasville Furniture Industries, Inc. (the "Material
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Subsidiaries") is a corporation duly organized, validly existing and in good
standing in the jurisdiction of its incorporation, with full corporate power and
authority to own, lease and operate its properties and to conduct its business
as described in the Registration Statement and the Prospectuses, and is duly
registered and qualified to conduct its business and is in good standing in each
jurisdiction or place where the nature of its properties or the conduct of its
business requires such registration or qualification, except where the failure
so to register or qualify does not, individually or in the aggregate, have a
Material Adverse Effect; all the outstanding shares of capital stock of each of
the Material Subsidiaries have been duly authorized and validly issued, are
fully paid and nonassessable, and are owned by the Company, free and clear of
any lien, adverse claim, security interest, equity, or other encumbrance,
except as described in the Registration Statement.
(g) There are no legal or governmental proceedings pending or, to the
knowledge of the Company, threatened, against the Company or any of the
Subsidiaries, or to which the Company or any of the Subsidiaries, or to which
any of their respective properties is subject, that are required to be described
in the Registration Statement or the Prospectuses but are not described as
required, and there are no agreements, contracts, indentures, leases or other
instruments that are required to be described in the Registration Statement or
the Prospectuses or to be filed as an exhibit to the Registration Statement or
any Incorporated Document therein that are not described or filed as required by
the Act or the Exchange Act.
(h) Neither the Company nor any of the Subsidiaries is in violation of
its certificate or articles of incorporation or by-laws, or other organizational
documents, or of any law, ordinance, administrative or governmental rule or
regulation applicable to the Company or any of the Subsidiaries or of any decree
of any court or governmental agency or body having jurisdiction over the Company
or any of the Subsidiaries, except any violations which will not, individually
or in the aggregate, have a Material Adverse Effect, or in default in any
material respect in the performance of any material obligation, agreement or
condition contained in any bond, debenture, note or any other evidence of
indebtedness or in any material agreement, indenture, lease or other instrument
to which the Company or any of the Subsidiaries is a party or by which any of
them or any of their respective properties may be bound (except where any such
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default or defaults would not, individually or in the aggregate, have a Material
Adverse Effect).
(i) Neither the sale of the Underwritten Shares, the execution,
delivery or performance of this Agreement, the Stock Purchase and Secondary
Offering Agreement dated as of May 27, 1997, among the Company and the Selling
Stockholders (the "Repurchase Agreement"), and the Secured Credit Agreement (as
defined herein) by the Company nor the consummation by the Company of the
transactions contemplated hereby or thereby (i) requires any consent, approval,
authorization or other order of or registration or filing with, any court,
regulatory body, administrative agency or other governmental body, agency or
official (except such as may be required for the registration of the Shares
under the Act and compliance with the securities or Blue Sky laws of various
jurisdictions, both of which have been or will be effected in accordance with
this Agreement) or conflicts or will conflict with or constitutes or will
constitute a breach of, or a default under, the certificate or articles of
incorporation or bylaws, or other organizational documents, of the Company or
any of the Subsidiaries or (ii) conflicts or will conflict with or constitutes
or will constitute a breach of, or a default under, any agreement, indenture,
lease or other instrument to which the Company or any of the Subsidiaries is a
party or by which any of them or any of their respective properties may be
bound, or violates or will violate any statute, law, regulation or filing
(except the securities or Blue Sky laws of the various jurisdictions, as to
which no representation or warranty is made) or judgment, injunction, order or
decree applicable to the Company or any of the Subsidiaries or any of their
respective properties, or will result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any of the
Subsidiaries pursuant to the terms of any agreement or instrument to which any
of them is a party or by which any of them may be bound or to which any of the
property or assets of any of them is subject.
(j) The accountants, KPMG Peat Marwick LLP, who have certified or
shall certify the financial statements included or incorporated by reference in
the Registration Statement and the Prospectuses (or any amendment or supplement
thereto) are independent public accountants as required by the Act.
(k) The financial statements, together with related schedules and
notes, included or incorporated by reference in the Registration Statement and
the Prospectuses (and any amendment or supplement thereto), present fairly, in
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all material respects, the consolidated financial position, results of
operations and changes in financial position of the Company and the Subsidiaries
on the basis stated in the Registration Statement at the respective dates or for
the respective periods to which they apply; such statements and related
schedules and notes have been prepared in accordance with generally accepted
accounting principles consistently applied throughout the periods involved,
except as disclosed therein; and the other financial and statistical information
and data relating to the Company and the Subsidiaries included or incorporated
by reference in the Registration Statement and the Prospectuses (and any
amendment or supplement thereto) are accurately presented in all material
respects and prepared on a basis consistent with such financial statements and
the books and records of the Company and the Subsidiaries.
(l) The execution and delivery of, and the performance by the Company
of its obligations under, this Agreement, the Repurchase Agreement and the
Secured Credit Agreement have been duly and validly authorized by the Company,
and each of this Agreement, the Repurchase Agreement and the Secured Credit
Agreement has been duly executed and delivered by the Company and constitutes a
valid and legally binding agreement of the Company, enforceable against the
Company in accordance with terms, except as rights to indemnity and contribution
hereunder or thereunder may be limited by federal or state securities laws and
subject to the qualification that the enforceability of the Company's
obligations hereunder or thereunder may be limited by bankruptcy, fraudulent
conveyance, insolvency, reorganization, moratorium, and other laws relating to
or affecting creditors' rights generally, and by general equitable principles.
(m) Except as disclosed in the Registration Statement and the
Prospectuses (or any amendment or supplement thereto), subsequent to the
respective dates as of which such information is given in the Registration
Statement and the Prospectuses (or any amendment or supplement thereto), neither
the Company nor any of the Subsidiaries has incurred any liability or
obligation, direct or contingent, or entered into any transaction, not in the
ordinary course of business, that is material to the Company and the
Subsidiaries taken as a whole, and there has not been any change in the capital
stock of the Company, or material increase in the short-term debt or long-term
debt of the Company or any of the Subsidiaries, or any material adverse change,
or any development involving or which may reasonably be expected to involve, a
prospective material adverse change, in the condition (financial or other),
15
business, net worth or results of operations of the Company and the Subsidiaries
taken as a whole.
(n) With only such exceptions as would not, individually or in the
aggregate, have a Material Adverse Effect, each of the Company and the
Subsidiaries has good and, in the case of real property, marketable title to all
property (real and personal) described in the Prospectuses as being owned by it,
free and clear of all liens, claims, security interests or other encumbrances
except such as are described in the Registration Statement and the Prospectuses
or in a document filed as an exhibit to the Registration Statement and all the
property described in the Prospectuses as being held under lease by each of the
Company and the Subsidiaries is held by it under valid, subsisting and
enforceable leases.
(o) The Company has not distributed and, prior to the later to occur
of (i) the Closing Date and (ii) completion of the distribution of the Shares,
will not distribute any offering material in connection with the offering and
sale of the Shares other than the Registration Statement, the Prepricing
Prospectuses, the Prospectuses or other materials, if any, permitted by the Act.
(p) The Company and each of the Subsidiaries has such material
permits, licenses, franchises and authorizations of governmental or regulatory
authorities ("permits") as are necessary to own its respective properties and to
conduct its business in all material respects in the manner described in the
Prospectuses, subject to such qualifications as may be set forth in the
Prospectuses; the Company and each of the Subsidiaries has fulfilled and
performed all its material obligations with respect to such permits and no event
has occurred which allows, or after notice or lapse of time would allow,
revocation or termination thereof or results in any other material impairment of
the rights of the holder of any such permit, subject in each case to such
qualification as may be set forth in the Prospectuses; and, except as described
in the Prospectuses, none of such permits contains any restriction that is
materially burdensome to the Company or any of the Subsidiaries.
(q) The properties, assets and operations of the Company and its
Subsidiaries comply with all applicable Environmental Laws (as defined below),
except to the extent that failure so to comply would not, individually or in the
aggregate, have a Material Adverse Effect. Except as specifically described in
the Prospectuses, none of the property, assets or operations of the Company or
16
its Subsidiaries is the subject of any investigation by any federal, state,
local or foreign governmental agency evaluating whether any remedial action is
needed to respond to a release of any Hazardous Materials (as defined below)
into the environment or a release of any Hazardous Materials that is in
contravention of any federal, state, local or foreign law, order or regulation,
in each case that is likely to have a Material Adverse Effect, and neither the
Company nor any Subsidiary has received notice of any such investigation.
Except as described in the Prospectuses, neither the Company nor any Subsidiary
has received any notice or claim, nor are there pending, reasonably anticipated
or, to the best knowledge of the Company, threatened lawsuits against any of
them, with respect to violations of an Environmental Law or in connection with
any release of any Hazardous Materials into the environment that, if adversely
determined, could have a Material Adverse Effect. Except as disclosed in the
Prospectuses, with respect to the business of the Company or its Subsidiaries,
including any previously or currently owned, leased, or used properties or
operations, there are no past, present, or, to the best knowledge of the
Company, reasonably anticipated future events, conditions, circumstances,
activities, practices, incidents, actions or plans that may interfere with or
prevent compliance or continued compliance with the Environmental Laws in any
material respect. As used herein, "Environmental Laws" means any federal,
state, local or foreign law, common law, doctrine, rule, order, decrees,
judgment, injunction, license, permit or regulation relating to environmental
matters, and "Hazardous Materials" means those substances that are regulated by
or form the basis of liability under any Environmental Laws.
(r) The Company and each other person or entity that, together with
the Company, is treated as a single employer under Section 414 of the Internal
Revenue Code of 1986, as amended (the "Code") (each such person or entity being
an "ERISA Affiliate"), complies in all material respects with the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), and the Code with
respect to each pension plan (as defined in Section 3(2) of ERISA) maintained by
the Company or such ERISA Affiliate, and none of the Company or any of its ERISA
Affiliates has incurred any material liability under Title IV of ERISA to any
pension plan or to the Pension Benefit Guaranty Corporation that has not been
fully paid as of the date hereof.
(s) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurances that (i) transactions are executed
in accordance with management's general or specific authorization; (ii)
17
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain accountability for assets; (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 existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(t) To the knowledge of the Company, neither the Company nor any of
its Subsidiaries nor any employee or agent of the Company or any Subsidiary has
made any payment of funds of the Company or any Subsidiary or received or
retained any funds in violation of any law, rule or regulation, which payment,
receipt or retention of funds is of a character required to be disclosed in the
Prospectuses.
(u) The Company and each of the Subsidiaries have filed all material
tax returns required to be filed, which returns are complete and correct in all
material respects, and neither the Company nor any Subsidiary is in default in
the payment of any taxes which were payable pursuant to said returns or any
assessments with respect thereto.
(v) No holder of any security of the Company has any right (except as
has been satisfied or waived) to require registration of shares of Common Stock
or any other security of the Company because of the filing of the registration
statement or consummation of the transactions contemplated by this Agreement.
(w) The Company and the Subsidiaries own or possess all patents,
trademarks, trademark registrations, service marks, service xxxx registrations,
trade names, copyrights, licenses, inventions, trade secrets and rights
described in the Prospectuses as being owned by them or any of them or to the
Company's knowledge necessary for the conduct of their respective businesses,
and the Company is not aware of any claim to the contrary or any challenge by
any other person to the rights of the Company and the Subsidiaries with respect
to the foregoing which will have a Material Adverse Effect.
(x) The Company has complied with all provisions of Florida Statutes,
(S)517.075, relating to issuers doing business with Cuba.
18
8. Representations and Warranties of the Selling Stockholders. Each
----------------------------------------------------------
Selling Stockholder represents and warrants to each Manager and the Company
that:
(a) Such Selling Stockholder now has, and on the Closing Date will
have, full legal right, power and authorization, and any approval required by
law, to sell, assign, transfer and deliver such Shares in the manner provided in
this Agreement, and upon delivery of and payment for such Shares hereunder, the
several Managers will acquire valid and marketable title to such Shares free and
clear of any lien, claim, security interest, or other encumbrance.
(b) The execution and delivery of, and the performance by such
Selling Stockholder of its obligations under, this Agreement and the Repurchase
Agreement have been duly and validly authorized by such Selling Stockholder, and
each of this Agreement and the Repurchase Agreement has been duly executed and
delivered by such Selling Stockholder and constitutes a valid and legally
binding agreement of such Selling Stockholder, enforceable against such Selling
Stockholder in accordance with its terms, except as limited by federal or state
securities laws and subject to the qualification that the enforceability of the
Selling Stockholder's obligations hereunder or thereunder may be limited by
bankruptcy, fraudulent conveyance, insolvency reorganization, moratorium, and
other laws relating to or affecting creditors' rights generally, and by general
equitable principles.
(c) Neither the sale of the Shares nor the execution, delivery or
performance of this Agreement or the Repurchase Agreement by or on behalf of
such Selling Stockholder nor the consummation by or on behalf of such Selling
Stockholder of the transactions contemplated hereby or thereby (i) requires any
consent, approval, authorization or other order of, or registration or filing
with, any court, regulatory body, administrative agency or other governmental
body, agency or official (except such as may be required for the registration of
the Shares under the Act or compliance with the securities laws of various
jurisdictions), or (ii) conflicts or will conflict with or constitutes or will
constitute a breach of, or a default under, any agreement, indenture, lease or
other instrument to which such Selling Stockholder is a party or by which such
Selling Stockholder is or may be bound, or violates or will violate any statute,
law, regulation or filing or judgment, injunction, order or decree applicable to
such Selling Stockholder, or will result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of such Selling
19
Stockholder pursuant to the terms of any agreement or instrument to which such
Selling Stockholder is a party or by which such Selling Stockholder may be bound
or to which any of the property or assets of such Selling Stockholder is
subject.
(d) The Registration Statement and the Prospectuses, insofar as they
contain information relating to such Selling Stockholder, do not and will not
contain an untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading.
(e) Such Selling Stockholder has not taken, directly or indirectly,
any action designed to or that might reasonably be expected to cause or result
in stabilization or manipulation of the price of the Common Stock to facilitate
the sale or resale of the Shares, except for the lock-up arrangements referred
to in the Prospectuses.
(f) Such Selling Stockholder (without undertaking any independent
investigation) does not have any knowledge that the Registration Statement or
the Prospectuses (or any amendment or supplement thereto) contains any untrue
statement of a material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein not misleading.
9. Indemnification and Contribution. (a) The Company agrees to
--------------------------------
indemnify and hold harmless each of you and each other Manager and each person,
if any, who controls any Manager within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act from and against any and all losses, claims,
damages, liabilities and expenses (including reasonable costs of investigation)
arising out of or based upon any untrue statement or alleged untrue statement of
a material fact contained in any International Prepricing Prospectus or in the
Registration Statement or the International Prospectus or in any amendment or
supplement thereto, or arising out of or based upon any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, except insofar as such
losses, claims, damages, liabilities or expenses arise out of or are based upon
any untrue statement or omission or alleged untrue statement or omission which
has been made therein or omitted therefrom in reliance upon and in conformity
with the information relating to such Manager or U.S. Underwriter furnished in
writing to the Company by or on behalf of any Manager through you or by or on
behalf of any U.S. Underwriter through a Representative expressly for use in
connection therewith; provided, however, that the indemnification contained in
20
this paragraph (a) with respect to any International Prepricing Prospectus shall
not inure to the benefit of any Manager (or to the benefit of any person
controlling such Manager) on account of any such loss, claim, damage, liability
or expense arising from the sale of the Shares by such Manager to any person if
a copy of the International Prospectus shall not have been delivered or sent to
such person within the time required by the Act and the regulations thereunder,
and the untrue statement or alleged untrue statement or omission or alleged
omission of a material fact contained in such International Prepricing
Prospectus was corrected in the International Prospectus, provided that the
Company has delivered the International Prospectus to the several Managers in
requisite quantity on a timely basis to permit such delivery or sending. The
foregoing indemnity agreement shall be in addition to any liability which the
Company may otherwise have.
(b) Each Selling Stockholder agrees, severally and not jointly, to
indemnify and hold harmless you and each other Manager and each person, if any,
who controls any Manager within the meaning of Section 15 of the Act or Section
20 of the Exchange Act with the same exceptions and to the same extent as the
foregoing indemnity from the Company to each Manager, but only with respect to
information relating to such Selling Stockholder furnished in writing by or on
behalf of such Selling Stockholder expressly for use in the Registration
Statement, the International Prospectus or any International Prepricing
Prospectus, or any amendment or supplement thereto. The foregoing indemnity
agreement shall be in addition to any liability which any Selling Stockholder
may otherwise have.
(c) If any action, suit or proceeding shall be brought against any Manager
or any person controlling any Manager in respect of which indemnity may be
sought against the Company, any Selling Stockholder or both, such Manager or
such controlling person shall promptly notify in writing the parties against
whom indemnification is being sought (the "indemnifying parties"), and such
indemnifying parties shall assume the defense thereof, including the employment
of counsel and payment of all fees and expenses. Such Manager or any such
controlling person shall have the right to employ separate counsel in any such
action, suit or proceeding and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of such Manager or
such controlling person unless (i) the indemnifying parties have agreed in
writing to pay such fees and expenses, (ii) the indemnifying parties have failed
to assume the defense and employ counsel, or (iii) the named parties to any such
21
action, suit or proceeding (including any impleaded parties) include both such
Manager or such controlling person and the indemnifying parties and such Manager
or such controlling person shall have been advised by its counsel in writing,
with a copy furnished to the Company upon request, that representation of such
indemnified party and the indemnifying parties by the same counsel would be
inappropriate under applicable standards of professional conduct (whether or not
such representation by the same counsel has been proposed) due to actual or
potential differing interests between them (in which case the indemnifying
parties shall not have the right to assume the defense of such action, suit or
proceeding on behalf of such Manager or such controlling person). It is
understood, however, that the indemnifying parties shall, in connection with any
one such action, suit or proceeding or separate but substantially similar or
related actions, suits or proceedings in the same jurisdiction arising out of
the same general allegations or circumstances, be liable for the reasonable fees
and expenses of only one separate firm of attorneys (in addition to any local
counsel) at any time for all such Managers and controlling persons not having
actual or potential differing interests with you or among themselves, which firm
shall be designated in writing by Xxxxx Xxxxxx Inc., and that all such fees and
expenses shall be reimbursed as they are incurred. The indemnifying parties
shall not be liable for any settlement of any such action, suit or proceeding
effected without its written consent, but if settled with such written consent,
or if there be a final judgment for the plaintiff in any such action, suit or
proceeding, the indemnifying parties agree to indemnify and hold harmless any
Manager, to the extent provided in the preceding paragraph, and any such
controlling person from and against any loss, claim, damage, liability or
expense by reason of such settlement or judgment.
(d) Each Manager agrees, severally and not jointly, to indemnify and hold
harmless the Company, its directors, its officers who sign the Registration
Statement, any person who controls the Company within the meaning of Section 15
of the Act or Section 20 of the Exchange Act and the Selling Stockholders, to
the same extent as the foregoing indemnity from the Company and the Selling
Stockholders to each Manager, but only with respect to information relating to
such Manager furnished in writing by or on behalf of such Manager through you
expressly for use in the Registration Statement, the International Prospectus or
any International Prepricing Prospectus, or any amendment or supplement thereto.
If any action, suit or proceeding shall be brought against the Company, any of
its directors, any such officer, any such controlling person or any Selling
22
Stockholder based on the Registration Statement, the International Prospectus or
any International Prepricing Prospectus, or any amendment or supplement thereto,
and in respect of which indemnity may be sought against any Manager pursuant to
this paragraph (d), such Manager shall have the rights and duties given to the
Company and the Selling Stockholders by paragraph (c) above (except that if the
Company or the Selling Stockholders shall have assumed the defense thereof such
Manager shall not be required to do so, but may employ separate counsel therein
and participate in the defense thereof, but the fees and expenses of such
counsel shall be at such Manager's expense), and the Company, its directors, any
such officer, any such controlling person and the Selling Stockholders shall
have the rights and duties given to the Managers by paragraph (c) above. The
foregoing indemnity agreement shall be in addition to any liability which any
Manager may otherwise have.
(e) If the indemnification provided for in this Section 9 is unavailable to
an indemnified party under paragraphs (a), (b) or (d) hereof in respect of any
losses, claims, damages, liabilities or expenses referred to therein, then an
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities or expenses (i) in such proportion
as is appropriate to reflect the relative benefits received by the Company and
the Selling Stockholders on the one hand and the Managers on the other hand from
the offering of the Shares, or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company and the Selling Stockholders on the one
hand and the Managers on the other in connection with the statements or
omissions that resulted in such losses, claims, damages, liabilities or
expenses, as well as any other relevant equitable considerations. The relative
benefits received by the Selling Stockholders on the one hand and the Managers
on the other shall be deemed to be in the same proportion as the total net
proceeds from the offering (before deducting expenses) received by the Selling
Stockholders bear to the total underwriting discounts and commissions received
by the Managers, in each case as set forth in the table on the cover page of the
International Prospectus. The relative fault of the Company and the Selling
Stockholders on the one hand and the Managers 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
23
a material fact relates to information supplied by the Company and the Selling
Stockholders on the one hand or by the Managers on the other hand and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
(f) The Company, the Selling Stockholders and the Managers agree that it
would not be just and equitable if contribution pursuant to this Section 9 were
determined by a pro rata allocation (even if the Managers 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 paragraph (e) above. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages, liabilities and expenses referred to in paragraph (e) above
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 any claim or defending any such action, suit or
proceeding. Notwithstanding the provisions of this Section 9, no Manager shall
be required to contribute any amount in excess of the amount by which the total
price of the Shares underwritten by it and distributed to the public exceeds the
amount of any damages which such Manager 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 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Managers'
obligations to contribute pursuant to this Section 9 are several in proportion
to the respective numbers of Shares set forth opposite their names in Schedule I
hereto (or such numbers of Shares increased as set forth in Section 12 hereof)
and not joint.
(g) No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened action,
suit or 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 action, suit or proceeding.
(h) Any losses, claims, damages, liabilities or expenses for which an
indemnified party is entitled to indemnification or contribution under this
Section 9 shall be paid by the indemnifying party to the indemnified party as
24
such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 9 and the
representations and warranties of the Company and the Selling Stockholders set
forth in this Agreement shall remain operative and in full force and effect,
regardless of (i) any investigation made by or on behalf of any Manager or any
person controlling any Manager, the Company, its directors or officers or the
Selling Stockholders, any director, officer or partner of a Selling Stockholder
or any person controlling the Company or any Selling Stockholder, (ii)
acceptance of any Shares and payment therefor hereunder, and (iii) any
termination of this Agreement. A successor to any Manager or any person
controlling any Manager, or to the Company, its directors or officers, or to a
Selling Stockholder, any director, officer or partner of a Selling Stockholder
or any person controlling the Company or any Selling Stockholder shall be
entitled to the benefits of the indemnity, contribution and reimbursement
agreements contained in this Section 9.
10. Conditions of Managers' Obligations. The several obligations of the
-----------------------------------
Managers to purchase the Shares hereunder are subject to the following
conditions:
(a) If, at the time this Agreement is executed and delivered, it is
necessary for the registration statement or a post-effective amendment thereto
(or a Rule 462(b) Registration Statement) to be declared effective before the
offering of the Shares may commence, the registration statement or such post-
effective amendment or Rule 462(b) Registration Statement shall have become
effective not later than 5:30 P.M., New York City time, on the date hereof, or
at such later date and time as shall be consented to in writing by you, and all
filings, if any, required by Rules 424 and 430A under the Act shall have been
timely made; no stop order suspending the effectiveness of the registration
statement shall have been issued and no proceeding for that purpose shall have
been instituted or, to the knowledge of the Company or any Manager, threatened
by the Commission, and any request of the Commission for additional information
(to be included in the registration statement or the Prospectuses or otherwise)
shall have been complied with to your reasonable satisfaction.
(b) Subsequent to the effective date of this Agreement, there shall
not have occurred (i) any change, or any development involving a prospective
change, in or affecting the condition (financial or other), business,
properties, net worth, or results of operations of the Company or the
Subsidiaries not contemplated by the Prospectuses, which in your reasonable
opinion, as Lead Managers for the several Managers, would materially, adversely
25
affect the market for the Shares, or (ii) any event or development relating to
or involving the Company or any officer or director of the Company which makes
any statement made in the Prospectuses untrue or which, in the opinion of the
Company and its counsel or the Managers and their counsel, requires the making
of any addition to or change in the Prospectuses in order to state a material
fact required by the Act or any other law to be stated therein or necessary in
order to make the statements therein not misleading, if amending or
supplementing the Prospectuses to reflect such event or development would, in
your reasonable opinion, as Lead Managers for the several Managers, materially
adversely affect the market for the Shares.
(c) Each condition (other than the issuance and sale of the Shares) to
the closing contemplated by the Repurchase Agreement, shall have been satisfied
or waived. There shall exist at and as of the Closing Date (after giving effect
to the transactions contemplated by this Agreement) no condition that would
constitute a default (or any event that with notice or the lapse of time, or
both, would constitute a default) under the Repurchase Agreement, which has not
been waived. Simultaneously with the issue and sale of the Shares by the
Company, the Company will repurchase from the Selling Stockholders 10,842,299
shares of Common Stock and warrants to purchase 290,821 shares of Common Stock
(the "Company Repurchase"). The Company Repurchase shall be consummated on
terms that conform in all material respects to the descriptions thereof in the
Prospectuses and the Representatives shall have received true and correct copies
of all documents pertaining thereto, as originally executed, and evidence
satisfactory to the Representatives of the consummation thereof.
(d) The Credit Agreement, dated as of March 27, 1994, as amended and
restated as of December 29, 1995, and further amended and restated as of
September 6, 1996, among the Company, Broyhill Furniture Industries, Inc., The
Lane Company, Incorporated, Thomasville Furniture Industries, Inc., the Banks
party thereto, Credit Lyonnais New York Branch, as Documentation Agent,
NationsBank, N.A., as Syndication Agent and Bankers Trust Company, as
Administrative Agent, shall be amended in all material respects in accordance
with the financing letter dated May 27, 1997 between Bankers Trust Company and
the Company and in accordance with the description of such amendment in the
Prospectuses (as so amended, the "Secured Credit Agreement"). Each condition to
the closing contemplated under the Secured Credit Agreement in connection with
the Company Repurchase shall have been satisfied or waived. There shall exist at
26
and as of the Closing Date (after giving effect to the transactions contemplated
by this Agreement) no condition that would constitute a default (or any event
that with notice or the lapse of time, or both, would constitute a default)
under the Secured Credit Agreement, which has not been waived.
The closing contemplated under the Secured Credit Agreement shall have been
consummated on terms that conform in all material respects to the descriptions
thereof in the Prospectuses and the Representatives shall have received true and
correct copies of all documents pertaining thereto, as originally executed, and
evidence satisfactory to the Representatives of the consummation thereof.
(e) You shall have received on the Closing Date, an opinion of Xxxxxx,
Xxxxx & Xxxxxxx LLP, counsel for the Company, dated the Closing Date and
addressed to you, as Lead Managers for the several Managers, to the effect that:
(i) The Company is a corporation validly existing in good standing
under the laws of the State of Delaware with corporate power and authority
to own, lease and operate its properties and to conduct its business as
described in the Registration Statement and the Prospectuses (and any
amendment or supplement thereto);
(ii) Each of the Material Subsidiaries is a corporation validly
existing in good standing under the laws of the jurisdiction of its
organization, with corporate power and authority to own, lease, and operate
its properties and to conduct its business as described in the Registration
Statement and the Prospectuses (and any amendment or supplement thereto);
(iii) The authorized and outstanding capital stock of the Company is
as set forth under the caption "Capitalization" in the Prospectuses; and
the authorized capital stock of the Company conforms in all material
respects as to legal matters to the description thereof contained in the
Prospectuses under the caption "Description of Capital Stock";
(iv) All the outstanding shares of capital stock of the Company have
been duly authorized and validly issued, and are fully paid and
nonassessable;
(v) The Registration Statement and all post-effective amendments, if
any, have become effective under the Act and, to the knowledge of such
counsel, no stop order suspending the effectiveness of the Registration
27
Statement has been issued and no proceedings for that purpose are pending
before or contemplated by the Commission; and any required filing of the
Prospectuses pursuant to Rule 424(b) has been made in accordance with Rule
424(b);
(vi) The Company has corporate power and authority to enter into this
Agreement, and this Agreement has been duly authorized, executed and
delivered by the Company and is a valid, legal and binding agreement of the
Company, enforceable against the Company in accordance with its terms,
except as enforcement of rights to indemnity and contribution hereunder may
be limited by Federal or state securities laws or principles of public
policy and subject to the qualification that the enforceability of the
Company's obligations hereunder may be limited by bankruptcy, fraudulent
conveyance, insolvency, reorganization, moratorium, and other laws relating
to or affecting creditors' rights generally, and by general equitable
principles;
(vii) Neither the offer, sale or delivery of the Shares, the
execution, delivery or performance of this Agreement, compliance by the
Company and the Selling Stockholders with the provisions hereof nor
consummation by the Company and the Selling Stockholders of the
transactions contemplated hereby conflicts or will conflict with or
constitutes or will constitute a breach of, or a default under, the
certificate or articles of incorporation or bylaws, or other organizational
documents, of the Company or any of the Material Subsidiaries or any
agreement, indenture, lease or other instrument to which the Company or any
of the Material Subsidiaries is a party or by which any of them or any of
their respective properties is bound that is an exhibit to the Registration
Statement or to any Incorporated Document, or is known to such counsel, or
will result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of the
Material Subsidiaries, nor will any such action result in any violation of
any existing law, regulation, ruling (assuming compliance with all
applicable state securities and Blue Sky laws), judgment, injunction, order
or decree known to such counsel, applicable to the Company, the Material
Subsidiaries or any of their respective properties;
(viii) The Registration Statement and the Prospectuses and any
supplements or amendments thereto (except for the financial statements and
28
the notes thereto and the schedules and other financial and statistical
data included therein, as to which such counsel need not express any
opinion) comply as to form in all material respects with the requirements
of the Act; and each of the Incorporated Documents included in the
Registration Statement (except for the financial statements and the notes
thereto and the schedules and other financial and statistical data included
therein, as to which counsel need not express any opinion) complies as to
form in all material respects with the Exchange Act and the rules and
regulations of the Commission thereunder;
(ix) To the knowledge of such counsel, (A) other than as described or
contemplated in the Prospectuses (or any supplement thereto), there are no
legal or governmental proceedings pending or threatened against the Company
or any of the Subsidiaries, or to which the Company or any of the
Subsidiaries, or any of their property, is subject, which are required to
be described in the Registration Statement or Prospectuses (or any
amendment or supplement thereto) and (B) there are no agreements,
contracts, indentures, leases or other instruments, that are required to be
described in the Registration Statement or the Prospectuses (or any
amendment or supplement thereto) or to be filed as an exhibit to the
Registration Statement or any Incorporated Document that are not described
or filed as required, as the case may be;
(x) The following statements in the Prospectuses, insofar as they are
descriptions of contracts, agreements or other legal documents, or refer to
statements of law or legal conclusions, are accurate and present fairly the
information required to be shown: on page 10, under "Risk Factors -
Significant Leverage", the second sentence relating to the Secured Credit
Agreement amount, the third sentence relating to the Receivables
Securitization Facility amount and the last sentence relating to the
interest rate swap agreement amounts; on page 10, under "Risk Factors -
Restrictive Covenants in Certain Debt Instruments", the entire paragraph;
on page 11, under "Risk Factors -Absence of Dividends", the first sentence
relating to restrictions on the payment of dividends under the Secured
Credit Agreement; on page 11, under "Risk Factors - Anti-Takeover
Provisions", the entire paragraph; on page 12, under "Price Range of Common
Stock and Dividend Policy", the first sentence of the last paragraph
relating to restrictions on the payment of dividends under the Secured
29
Credit Agreement; on page 16, under "Management's Discussion and Analysis
of Financial Condition and Results of Operations -General", the third
sentence of the third paragraph relating to no ownership interest or
management control of the footwear business upon the completion of the
restructuring; on page 21, under "Management's Discussion and Analysis of
Financial Condition and Results of Operations - Financial Condition and
Liquidity", the first five sentences of the fourth full paragraph relating
to the Secured Credit Agreement and the ninth and tenth sentences of such
paragraph relating to the financial covenants of the Secured Credit
Agreement, the entire fifth paragraph on the page relating to the
Receivables Securitization Facility and the entire sixth paragraph on the
page; on page 34, under "Business - Environmental Matters", the entire
first and second paragraphs; on page 36, under "Certain Transactions", the
entire paragraph; on page 36, under "Selling Stockholders and Company
Repurchase", the entire second paragraph beginning on the page; on page 37,
under "Selling Stockholders and Company Repurchase, the entire first full
paragraph; on page 37, under "Description of Capital Stock", the entire
section; on page 39, under "Certain U.S. Tax Consequences to Non-U.S.
Stockholders", the entire section; on page 42, under "Underwriting", the
first sentence of the third paragraph relating to the obligations of the
several underwriters; and
(xi) Although counsel has not undertaken, except as otherwise
indicated, to determine independently, and does not assume any
responsibility for, the accuracy or completeness of the statements in the
Registration Statement, such counsel has participated in the preparation of
the Registration Statement and the Prospectuses, including review and
discussion of the contents thereof (including review and discussion of the
contents of all Incorporated Documents), and nothing has come to the
attention of such counsel that has caused them to believe that the
Registration Statement (including the Incorporated Documents) at the time
the Registration Statement became effective, or the Prospectuses, as of the
date thereof and as of the Closing Date, contained an untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or that
any amendment or supplement to the Prospectuses, as of the respective date
thereof, and as of the Closing Date, contained any untrue statement of a
material fact or omitted to state a material fact necessary in order to
30
make the statements therein, in the light of the circumstances under which
they were made, not misleading (it being understood that such counsel need
express no belief with respect to the financial statements and the notes
thereto and the schedules and other financial and statistical data included
in the Registration Statement or the Prospectuses or any Incorporated
Document).
In rendering such opinion as aforesaid, counsel may limit their
opinion to the federal laws of the United States, the General Corporation Law of
the State of Delaware, and the laws of the States of New York and Pennsylvania,
and may assume that the laws of the Commonwealth of Virginia and the State of
North Carolina are in all relevant respects the same as the Delaware General
Corporation Law.
(f) You shall have received on the Closing Date an opinion from
Wachtell, Lipton, Xxxxx & Xxxx, counsel for the Selling Stockholders, dated the
Closing Date and addressed to you, as Lead Managers for the several Managers to
the effect that:
(i) This Agreement has been duly executed and delivered by or on
behalf of each of the Selling Stockholders;
(ii) Each Selling Stockholder has full legal right, power and
authorization, and any approval required by law, to sell, assign, transfer
and deliver good and marketable title to the Shares which such Selling
Stockholder has agreed to sell pursuant to this Agreement and, upon
delivery of the Shares to the Managers against payment therefor in
accordance with the provisions of this Agreement, the Managers will acquire
the Shares free of any adverse claim within the meaning of Section 8-302 of
the Uniform Commercial Code as in effect in the State of New York, assuming
the Managers have acquired the Shares in good faith and without notice of
any adverse claim; and
(iii) The Repurchase Agreement has been duly authorized, executed and
delivered by each of the Selling Stockholders and is a valid, legal and
binding agreement of each of the Selling Stockholders, enforceable against
each of them in accordance with its terms, except as enforcement of rights
to indemnity and contribution thereunder may be limited by Federal or state
securities laws or principles of public policy and subject to the
qualification that the enforceability of the Selling Stockholders'
31
obligations thereunder may be limited by bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium, and other laws relating to or
affecting creditors' rights generally, and by general equitable principles;
(iv) The execution and delivery of each of this Agreement by the
Selling Stockholders and the consummation of the transactions contemplated
hereby and thereby will not conflict with, violate, result in a breach of
or constitute a default under the terms or provisions of the partnership
agreement of any Selling Stockholder, or, to such counsel's knowledge, any
agreement, indenture, lease or other instrument to which any Selling
Stockholder is a party or by which any of them or any of their assets or
property is bound, or violate any statute, law, regulation, court order or
decree known to such counsel to be applicable to any Selling Stockholder or
to any of the property or assets of any Selling Stockholder, except for any
such conflicts, breaches, defaults or violations that would not,
individually or in the aggregate, have a Material Adverse Effect on the
ability of such Selling Stockholder to consummate the transactions
contemplated by this Agreement.
In rendering their opinion as aforesaid, counsel may, as to factual matters,
rely upon written certificates or statements of officers of the Selling
Stockholders and, as to matters of law, may limit their opinion to the federal
laws of the United States, the General Corporation Law of the State of Delaware
and the laws of the State of New York.
(g) You shall have received on the Closing Date, an opinion of Xxxx
Xxxxxxxxxxxx, Esq., general counsel for the Company, dated the Closing Date and
addressed to you, as Lead Managers for the several Managers, to the effect that:
(i) The Company and each of the Subsidiaries has corporate power and
authority, and, to such counsel's knowledge, all necessary governmental
authorizations, approvals, orders, licenses, certificates, franchises and
permits of and from all governmental regulatory officials and bodies
(except where the failure so to have any such authorizations, approvals,
orders, licenses, certificates, franchises or permits, individually or in
the aggregate, would not have a Material Adverse Effect), to own their
respective properties and to conduct their respective businesses as now
being conducted, as described in the Prospectuses;
32
(ii) Each of the Company and the Material Subsidiaries is duly
qualified to transact business as a foreign corporation in good standing in
the jurisdictions listed in an attached schedule, which are all
jurisdictions in which they own, lease or operate manufacturing facilities;
(iii) Neither the Company nor any of the Material Subsidiaries is in
violation of its respective certificate or articles of incorporation or
bylaws, or other organizational documents, to the knowledge of such
counsel, or is in default in the performance of any material obligation,
agreement or condition contained in any bond, debenture, note or other
evidence of indebtedness, to the knowledge of such counsel, except as may
be disclosed in the Prospectuses;
(iv) Except as disclosed in the Prospectuses, the Company owns of
record, directly or indirectly, all the outstanding shares of capital stock
of each of the Subsidiaries free and clear of any lien, adverse claim,
security interest, equity, or other encumbrance, and all the outstanding
shares of capital stock of each of the Subsidiaries have been duly
authorized and validly issued, are fully paid and nonassessable;
(v) Other than as described or contemplated in the Prospectuses (or
any supplement thereto), to such counsel's knowledge after reasonable
inquiry, there are no legal or governmental proceedings pending or
threatened against the Company or any of the Subsidiaries, or to which the
Company or any of the Subsidiaries, or any of their property, is subject,
which are required to be described in the Registration Statement or
Prospectuses (or any amendment or supplement thereto);
(vi) To such counsel's knowledge after reasonable inquiry, there are
no agreements, contracts, indentures, leases or other instruments, that are
required to be described in the Registration Statement or the Prospectuses
(or any amendment or supplement thereto) or to be filed as an exhibit to
the Registration Statement or any Incorporated Document therein that are
not described or filed as required, as the case may be;
(vii) The Company and the Subsidiaries own all patents, trademarks,
trademark registrations, service marks, service xxxx registrations, trade
names, copyrights, licenses, inventions, trade secrets and rights described
33
in the Prospectuses as being owned by them or any of them or, to the
knowledge of such counsel, necessary for the conduct of their respective
businesses, and such counsel is not aware of any claim to the contrary or
any challenge by any other person to the rights of the Company and the
Subsidiaries with respect to the foregoing;
(viii) To such counsel's knowledge after reasonable inquiry, neither
the Company nor any of the Subsidiaries is in violation of any law,
ordinance, administrative or governmental rule or regulation applicable to
the Company or any of the Subsidiaries or of any decree of any court or
governmental agency or body having jurisdiction over the Company or any of
the Subsidiaries except for violations that would not, individually or in
the aggregate, have a Material Adverse Effect;
(ix) Except as described in the Prospectuses, there are no
outstanding options, warrants or other rights calling for the issuance of,
and such counsel does not know of any commitment, plan or arrangement to
issue, any shares of capital stock of the Company or any security
convertible into or exchangeable or exercisable for capital stock of the
Company; and
(x) Except as described in the Prospectuses, there is no holder of
any security of the Company or any other person who has the right,
contractual or otherwise, to cause the Company to sell or otherwise issue
to them, or to permit them to underwrite the sale of, the Shares or the
right to have any Common Stock or other securities of the Company included
in the registration statement or the right, as a result of the filing of
the registration statement, to require registration under the Act of any
shares of Common Stock or other securities of the Company.
(xi) The Company has corporate power and authority to enter into the
Repurchase Agreement and the Secured Credit Agreement and each of the
Repurchase Agreement and the Secured Credit Agreement has been duly
authorized, executed and delivered by the Company and is a valid, legal and
binding agreement of the Company, enforceable against the Company in
accordance with its terms, except as enforcement of rights to indemnity and
contribution thereunder may be limited by Federal or state securities laws
or principles of public policy and subject to the qualification that the
34
enforceability of the Company's obligations thereunder may be limited by
bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium,
and other laws relating to or affecting creditors' rights generally, and by
general equitable principles;
(xii) Neither the execution, delivery or performance of the
Repurchase Agreement or the Secured Credit Agreement, compliance by the
Company with the provisions thereof nor consummation by the Company of the
transactions contemplated thereby conflicts or will conflict with or
constitutes or will constitute a breach of, or a default under, the
certificate or articles of incorporation or bylaws, or other organizational
documents, of the Company or any of the Material Subsidiaries or any
agreement, indenture, lease or other instrument to which the Company or any
of the Material Subsidiaries is a party or by which any of them or any of
their respective properties is bound that is an exhibit to the Registration
Statement or to any Incorporated Document, or is known to such counsel, or
will result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of the
Material Subsidiaries, nor will any such action result in any violation of
any existing law, regulation, ruling (assuming compliance with all
applicable state securities and Blue Sky laws), judgment, injunction, order
or decree known to such counsel, applicable to the Company, the Material
Subsidiaries or any of their respective properties;
(h) You shall have received on the Closing Date an opinion of Cravath,
Swaine & Xxxxx, counsel for the U.S. Underwriters, dated the Closing Date and
addressed to you, as Lead Managers for the several Managers, with respect to
such matters as you may reasonably request.
(i) You shall have received letters addressed to you, as Lead Managers
for the several Managers, and dated the date hereof and the Closing Date from
KPMG Peat Marwick LLP, independent certified public accountants, substantially
in the forms heretofore approved by you.
(j) (i) No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall have been taken or, to the knowledge of the Company, shall be
contemplated by the Commission at or prior to the Closing Date; (ii) there shall
not have been any material change in the capital stock of the Company nor any
material increase in the short-term or long-term debt of the Company (other than
35
in the ordinary course of business) from that set forth or contemplated in the
Registration Statement or the Prospectuses (or any amendment or Supplement
thereto); (iii) there shall not have been, since the respective dates as of
which information is given in the Registration Statement and the Prospectuses
(or any amendment or supplement thereto), except as may otherwise be stated in
the Registration Statement and Prospectuses (or any amendment or supplement
thereto), any material adverse change in the condition (financial or other),
business, prospects, properties, net worth or results of operations of the
Company and the Subsidiaries taken as a whole; (iv) the Company and the
Subsidiaries shall not have any liabilities or obligations, direct or contingent
(whether or not in the ordinary course of business), that are material to the
Company and the Subsidiaries, taken as a whole, other than those reflected in
the Registration Statement or the Prospectuses (or any amendment or supplement
thereto); and (v) all the representations and warranties of the Company
contained in this Agreement shall be true and correct on and as of the date
hereof and on and as of the Closing Date as if made on and as of the Closing
Date, and you shall have received a certificate of the Company, dated the
Closing Date and signed on behalf of the Company by the chief executive officer
and the chief financial officer of the Company (or such other officers as are
acceptable to you), to the effect set forth in this Section 10(j) and in Section
10(k) hereof.
(k) The Company shall not have failed at or prior to the Closing Date
to have performed or complied with any of its agreements herein contained and
required to be performed or complied with by it hereunder at or prior to the
Closing Date.
(l) All the representations and warranties of the Selling Stockholders
contained in this Agreement shall be true and correct on and as of the date
hereof and on and as of the Closing Date as if made on and as of the Closing
Date and you shall have received a certificate, dated the Closing Date, signed
by or on behalf of each Selling Stockholder to the effect set forth in this
Section 10(l) and in Section 10(m) hereof.
(m) The Selling Stockholders shall not have failed at or prior to the
Closing Date to have performed or complied with any of their agreements
contained in this Agreement and required to be performed or complied with by
them at or prior to the Closing Date.
(n) The Company and the Selling Stockholders shall have furnished or
caused to be furnished to you such further certificates and documents as you
shall have reasonably requested.
36
(o) The closing under the U.S. Underwriting Agreement shall have
occurred on the Closing Date concurrently with the closing hereunder.
All such opinions, certificates, letters and other documents will be
in compliance with the provisions hereof only if they are reasonably
satisfactory in form and substance to you and your counsel.
Any certificate or document signed by any officer of the Company or by
any Selling Stockholder and delivered to you, as Lead Managers for the Managers,
or to counsel for the Managers, shall be deemed a representation and warranty by
the Company or such Selling Stockholder to each Manager as to the statements
made therein.
11. Expenses. The Company and the Selling Stockholders agree to pay the
--------
following costs and expenses and all other costs and expenses incident to the
performance by them of their obligations hereunder: (i) the preparation,
printing or reproduction, and filing with the Commission of the registration
statement (including financial statements and exhibits thereto), each of the
Prepricing Prospectuses, the Prospectuses, and each amendment or supplement to
any of them; (ii) the printing (or reproduction) and delivery (including
postage, air freight charges and charges for counting and packaging) of such
copies of the registration statement, each International Prepricing Prospectus,
the International Prospectus, and all amendments or supplements to any of them
as may be reasonably requested for use in connection with the offering and sale
of the Shares; (iii) the preparation, printing, authentication, issuance and
delivery of certificates for the Shares, including any stamp taxes in connection
with the original issuance and sale of the Shares; (iv) the cost of production
(or reproduction) and delivery of this Agreement, the Blue Sky Memorandum and
all other agreements, memoranda, correspondence and other documents printed (or
reproduced) and delivered in connection with the original issuance and sale of
the Shares; (v) the registration or qualification of the Shares for offer and
sale under the securities or Blue Sky laws of the several jurisdictions as
provided in Section 5(g) hereof (including the reasonable fees, expenses and
disbursements of counsel for the Managers and U.S. Underwriters relating to the
preparation, printing or reproduction, and delivery of the Blue Sky Memorandum
and such registration and qualification); (vi) the filing fees in connection
37
with any filings required to be made with the National Association of Securities
Dealers, Inc.; (vii) the transportation and other expenses incurred by or on
behalf of representatives of the Company in connection with presentations to
prospective purchasers of the Shares; (viii) the fees and expenses of the
Company's accountants and the fees and expenses of counsel (including local and
special counsel) for the Company and the Selling Stockholders; (ix) the
underwriting discounts and commissions (in proportion to the number of Shares
being offered by each Selling Stockholder; and (x) the performance by the
Company and the Selling Stockholders of their other obligations under this
Agreement.
12. Effective Date of Agreement. This Agreement shall become effective:
---------------------------
(i) upon the execution and delivery hereof by the parties hereto; or (ii) if, at
the time this Agreement is executed and delivered, it is necessary for the
registration statement or a post-effective amendment thereto to be declared
effective before the offering of the Shares may commence, when notification of
the effectiveness of the registration statement or such post-effective amendment
has been released by the Commission. Until such time as this Agreement shall
have become effective, it may be terminated by the Company or the Selling
Stockholders, by notifying you, or by you, as Lead Managers for the several
Managers, by notifying the Company and the Selling Stockholders.
If any one or more of the Managers shall fail or refuse to purchase
Shares which it or they are obligated to purchase hereunder on the Closing Date,
and the aggregate number of Shares which such defaulting Manager or Managers are
obligated but fail or refuse to purchase is not more than one-tenth of the
aggregate number of Shares which the Managers are obligated to purchase on the
Closing Date, each non-defaulting Manager shall be obligated, severally, in the
proportion which the number of Shares set forth opposite its name in Schedule I
hereto bears to the aggregate number of Shares set forth opposite the names of
all non-defaulting Managers or in such other proportion as you may specify in
accordance with Section 20 of the Master Agreement Among Underwriters of Xxxxx
Xxxxxx Inc., to purchase the Shares which such defaulting Manager or Managers
are obligated, but fail or refuse, to purchase. If any one or more of the
Managers shall fail or refuse to purchase Shares which it or they are obligated
to purchase on the Closing Date and the aggregate number of Shares with respect
to which such default occurs is more than one-tenth of the aggregate number of
Shares which the Managers are obligated to purchase on the Closing Date and
arrangements satisfactory to you and the Selling Stockholders for the purchase
38
of such Shares by one or more non-defaulting Managers or other party or parties
approved by you and the Selling Stockholders are not made within 36 hours after
such default, this Agreement will terminate without liability on the part of any
non-defaulting Manager, the Company or any Selling Stockholder. In any such
case which does not result in termination of this Agreement, either you or the
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
Registration Statement and the Prospectuses or any other documents or
arrangements may be effected. Any action taken under this paragraph shall not
relieve any defaulting Manager from liability in respect of any such default of
any such Manager under this Agreement. The term "Manager" as used in this
Agreement includes, for all purposes of this Agreement, any party not listed in
Schedule I hereto who, with your approval and the approval of the Company,
purchases Shares which a defaulting Manager is obligated, but fails or refuses,
to purchase.
Any notice under this Section 12 may be given by telegram, telecopy or
telephone but shall be subsequently confirmed by letter.
13. Termination of Agreement. This Agreement shall be subject to
------------------------
termination in your absolute discretion, without liability on the part of any
Manager to the Company or any Selling Stockholder by notice to the Company, if
prior to the Closing Date (i) trading in securities generally on the New York
Stock Exchange, the American Stock Exchange or the Nasdaq National Market shall
have been suspended or materially limited, (ii) a general moratorium on
commercial banking activities in New York shall have been declared by either
federal or state authorities, or (iii) there shall have occurred any outbreak or
escalation of hostilities or other international or domestic calamity, crisis or
change in political, financial or economic conditions, the effect of which on
the financial markets of the United States is such as to make it, in your
judgment, impracticable or inadvisable to commence or continue the offering of
the Shares at the offering price to the public set forth on the cover page of
the International Prospectus or to enforce contracts for the resale of the
Shares by the Managers. Notice of such termination may be given to the Company
and the Selling Stockholders by telegram, telecopy or telephone and shall be
subsequently confirmed by letter.
14. Information Furnished by the Managers. The statements set forth in
-------------------------------------
the last paragraph on the cover page, the stabilization legend on the inside
front cover, and the statements in the first, second, fourth, seventh, eighth,
39
ninth, tenth, thirteenth and fourteenth paragraphs under the caption
"Underwriting" in any International Prepricing Prospectus and in the
International Prospectus, constitute the only information furnished by or on
behalf of the Managers through you as such information is referred to in
Sections 7(b) and 9 hereof.
15. Miscellaneous. Except as otherwise provided in Sections 5, 12 and 13
-------------
hereof, notice given pursuant to any provision of this Agreement shall be in
writing and shall be delivered (i) if to the Company, at the office of the
Company at Furniture Brands International, Inc., 000 Xxxxx Xxxxxx Xxxx, Xx.
Xxxxx, Xxxxxxxx 00000, Attention: Xxxx Xxxxxxxxxxxx, Esq., General Counsel; (ii)
if to the Selling Stockholders, at Apollo Investment Fund, L.P., care of CICB
Bank and Trust Company (Cayman) Limited, Xxxxxx Street, Georgetown, Grand
Cayman, Cayman Islands, British West Indies and Xxxx Xxxxxxxx, X.X., Xxx
Xxxxxxxxxxxxxx Xxxx, Xxxxxxxx, Xxx Xxxx 00000; or (iii) if to you, as Lead
Managers for the several Managers, care of Xxxxx Xxxxxx Inc., 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Manager, Investment Banking
Division.
This Agreement has been and is made solely for the benefit of the
several Managers, the Company, its directors and officers, and the other
controlling persons referred to in Section 9 hereof and the Selling Stockholders
and their respective successors and assigns, to the extent provided herein, and
no other person shall acquire or have any right under or by virtue of this
Agreement. Neither the term "successor" nor the term "successors and assigns"
as used in this Agreement shall include a purchaser from any Manager of any of
the Shares in his status as such purchaser.
16. Applicable Law; Counterparts. This Agreement shall be governed by and
----------------------------
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of New York.
This Agreement may be signed in various counterparts which together
constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
40
Please confirm that the foregoing correctly sets forth the agreement
among the Company, the Selling Stockholders and the several Managers.
Very truly yours,
FURNITURE BRANDS INTERNATIONAL, INC.
By ........................
Name:
Title: Vice President
APOLLO INVESTMENT FUND, L.P.
By: Apollo Advisors, L.P.,
Managing General Partner
By: Apollo Capital Management,
Inc., General Partner
By ........................
Name:
Title: Vice President
LION ADVISORS, L.P.,
on behalf of an investment account
under management
By: Lion Capital Management, Inc.
General Partner
By ........................
Name:
Title: Vice President
41
Confirmed as of the date first
above mentioned on behalf of
themselves and the other several
Managers named in Schedule I
hereto.
XXXXX XXXXXX INC.
CREDIT SUISSE FIRST BOSTON (EUROPE) LIMITED
XXXXXX, READ & CO. INC
XXXXXXX XXXXX INTERNATIONAL
SALOMON BROTHERS INTERNATIONAL LIMITED
WHEAT, FIRST SECURITIES, INC.
As Lead Managers for the Several Managers
By XXXXX XXXXXX INC.
By ..........................
Name:
Title:
42
SCHEDULE I
FURNITURE BRANDS INTERNATIONAL, INC.
Number of
Manager Shares
------------------------------------------- ---------
Xxxxx Xxxxxx Inc. . . . . . . . . . . . . .
Credit Suisse First Boston (Europe) Limited
Xxxxxx, Read & Co. Inc. . . . . . . . . . .
Xxxxxxx Xxxxx International . . . . . . . .
Salomon Brothers International Limited . .
Wheat, First Securities, Inc. . . . . . . .
Total . . . . . . . . . . . . . 2,200,000
=========
43
SCHEDULE II
FURNITURE BRANDS INTERNATIONAL, INC.
Selling Stockholders
--------------------
Number of
Name Shares
-------------------------------------------- ---------
Apollo Investment Fund, L.P. . . . . . . . . 1,100,000
Lion Advisors, L.P., on behalf of
an investment account under
management . . . . . . . . . . . . . . . . . 1,100,000
---------
Total 2,200,000
=========
44
SCHEDULE III
FURNITURE BRANDS INTERNATIONAL, INC.
Required Director and Officer Lock-Ups
--------------------------------------
1. Xxxxxxx X. Xxxxx
2. Xxxxxxx X. Xxxxxxxx, Xx.
3. Xxxxx X. Xxxxxxx
4. K. Xxxxx Xxxxx, Xx.
5. Xxxxxxxxx X. Xxxxx
6. Xxxxx X. Xxxxxx
7. Xxxx Xxxxxxxxxxxx
8. Xxxxxx X. Xxxxxxx
