Exhibit 4.2
National Vision Associates, Ltd.
$125,000,000 Aggregate Principal Amount of
12 % Senior Notes due 2005
__________________
PURCHASE AGREEMENT
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New York, New York
October 5, 1998
XXXXXXXX & CO. INC.
NATIONSBANC XXXXXXXXXX SECURITIES LLC
FIRST UNION CAPITAL MARKETS
c/x XXXXXXXX & CO. INC.
Equitable Center
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
National Vision Associates, Ltd., a Georgia corporation (the
"COMPANY"), proposes, subject to the terms and conditions stated herein, to
issue and sell to you (the "INITIAL PURCHASERS") $125,000,000 aggregate
principal amount of 12 % Senior Notes due 2005 (the "NOTES"), to be issued
pursuant to the provisions of an Indenture (the "INDENTURE") to be entered
into among the Company, the Guarantors (as defined below) and State Street
Bank and Trust Company, as trustee (the "TRUSTEE"). The Notes will be
guaranteed (the "GUARANTEES") by each of the Subsidiaries (as defined below)
of the Company signatory hereto and each subsidiary that in the future
executes a supplemental indenture pursuant to which such subsidiary agrees
to guarantee the Notes (each, a "GUARANTOR" and collectively, the
"GUARANTORS," and together with the Company, the "ISSUERS"). The Notes and
the Guarantees are collectively referred to herein as the "SECURITIES."
The Securities will be offered without being registered under the
Securities Act of 1933, as amended (the "SECURITIES ACT"), in reliance on
exemptions therefrom provided by Section 4(2) of the Securities Act and Rule
144A promulgated thereunder.
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In connection with the offering and sale of the Securities (the
"OFFERING"), the Issuers have prepared a preliminary offering memorandum
including the documents incorporated by reference therein, the "PRELIMINARY
OFFERING MEMORANDUM") and will prepare a final offering memorandum
(including the documents incorporated by reference therein, the "FINAL
OFFERING MEMORANDUM" and, together with the Preliminary Offering Memorandum,
each a "MEMORANDUM") setting forth or including a description of the terms
of the Notes, the terms of the Offering, a description of the Company and
its Subsidiaries and any material developments relating to the Company and
its Subsidiaries occurring after the date of the most recent financial
statements included therein.
You and your direct and indirect transferees will be entitled to
the benefits of a registration rights agreement to be entered into among the
Company, the Guarantors and the Initial Purchasers substantially in the form
attached hereto as EXHIBIT A (the "REGISTRATION RIGHTS AGREEMENT"), pursuant
to which the Issuers will agree to use their best efforts to file and have
declared effective a registration statement (an "EXCHANGE OFFER REGISTRATION
STATEMENT") with the Securities and Exchange Commission (the "COMMISSION")
registering the offer and sale of the Notes, the Private Exchange Notes or
the Exchange Notes (each as defined in the Registration Rights Agreement)
and related guarantees under the Securities Act. This Agreement, the
Guarantees, the Notes, the Indenture and the Registration Rights Agreement
are referred to herein as the "OFFERING DOCUMENTS."
In connection with the Offering, the Company will acquire New West
Eyeworks, Inc. ("NEW WEST") pursuant to an Agreement and Plan of Merger,
dated July 13, 1998, by and among the Company, NW Acquisition Corp. and New
West, as amended (the "MERGER AGREEMENT"). To effect the transaction, the
Company commenced a cash tender offer pursuant to that certain Offer to
Purchase dated July 20, 1998 (the "OFFER TO PURCHASE") for all of the shares
of common stock of New West (as the same may be modified or amended, the
"TENDER OFFER"). Subsequent to the consummation of the Tender Offer,
pursuant to the Merger Agreement, NW Acquisition Corp., a wholly owned
subsidiary of the Company, will be merged with and into New West (the
"MERGER"). In addition, the Company and the Guarantors will enter into a
credit agreement (such agreement, together with all documents executed in
connection therewith, the "NEW CREDIT AGREEMENT") for a $25.0 million
revolving credit facility (the "NEW CREDIT FACILITY").
This is to confirm the agreement concerning the purchase by you of
the Securities from the Issuers.
1. The Company and the Guarantors, jointly and severally,
represent and warrant to and agree with you that:
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(a) The Preliminary Offering Memorandum, as of its date, did not
contain any untrue statement of a material fact or omit to state a
material fact (except for pricing terms and other financial terms
intentionally left blank) necessary to make the statements therein, in
the light of the circumstances under which they were made, not mislead-
ing, and the Final Offering Memorandum, as of its date, did not, and as
of the Delivery Date (as defined below) will not, contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading, except that the representations
and warranties set forth in this Section 1(a) do not apply to
statements or omissions contained in any Memorandum made in reliance
upon and in conformity with information relating to the Initial
Purchasers furnished by the Initial Purchasers to the Company in
writing expressly for use in either Memorandum or any amendment or
supplement thereto.
(b) Neither the Company nor any of the Subsidiaries has
sustained, since the date of the most recent financial statements
included in the Final Offering Memorandum, any loss or interference
with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court
or governmental action, order or decree, which loss or interference is
material to the Company and the Subsidiaries, taken as a whole. Since
the respective dates as of which information is given in the Final
Offering Memorandum there has not been any change in the capital stock
or short-term debt (other than in the ordinary course of business) or
long-term debt of the Company or any of the Subsidiaries, or any change
or development which could reasonably be expected to have a material
adverse effect upon the business, operations, assets, condition
(financial or otherwise) or prospects of the Company and the
Subsidiaries, taken as a whole, or an adverse effect on the ability of
the Company to perform its obligations under the Offering Documents (a
"MATERIAL ADVERSE EFFECT"), otherwise than as set forth or contemplated
in the Final Offering Memorandum.
(c) The Company, the Subsidiaries, New West and the New West
Subsidiaries (as defined below) have good and marketable title in fee
simple to all real property and good and marketable title to all
personal property owned by them, in each case, free and clear of all
liens, adverse claims, encumbrances, security interests and defects
except those that are described or contemplated by the Final Offering
Memorandum or those that do not materially affect the value of such
property and do not interfere with the use made or proposed to be made
(as described in the Final Offering Memorandum) of such property by the
Company, the Subsidiaries, New West and the New West Subsidiaries
(collectively, "LIENS"). Except with respect to leases to which New West
or any New West Subsidiary is a party for which consents must be obtained
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for the Merger and which consents have not yet been obtained, any real
property and buildings held under lease by the Company, the Subsidiaries,
New West and the New West Subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as are not material
and do not interfere with the use made or proposed to be made (as
described in the Final Offering Memorandum) of such real property and
buildings by the Company, the Subsidiaries, New West and the New West
Subsidiaries. Except as stated in the previous sentence, all contracts
and agreements to which the Company, any of the Subsidiaries, New West
or any of the New West Subsidiaries is a party or by which any of them
is bound are valid and enforceable against the Company, such Subsidiary,
New West or such New West Subsidiary, as the case may be, and are valid
and enforceable against the other party or parties thereto and are in
full force and effect with only such exceptions as would not,
individually or in the aggregate, have a Material Adverse Effect.
(d) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Georgia, with all necessary corporate power and authority to own its
properties and to conduct its business as described in the Final
Offering Memorandum. The Company has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
property, or conducts any business, so as to require such qualification
(except where the failure to so qualify, singly or in the aggregate
with all other such failures, would not have a Material Adverse
Effect). Each of the Company's subsidiaries is listed on SCHEDULE IA
hereto. Each of New West's subsidiaries (the "NEW WEST SUBSIDIARIES")
is listed on SCHEDULE IB hereto (collectively with New West and the
Company's subsidiaries, the "SUBSIDIARIES"). Except as described in
the Final Offering Memorandum, each of the Subsidiaries is wholly owned
directly or indirectly by the Company and each of the New West
Subsidiaries is wholly owned directly or indirectly by New West. Each
of the Subsidiaries, New West and the New West Subsidiaries has been
duly incorporated and is validly existing as a corporation in good
standing under the laws of its jurisdiction of incorporation, with all
necessary corporate power and authority to own its properties and
conduct its business as described in the Final Offering Memorandum.
None of the Company, the Subsidiaries, New West, or the New West
Subsidiaries owns, directly or indirectly, any shares of capital stock
or any other equity or long-term debt securities or has any equity
interest in any firm, partnership, joint venture or other entity
(except for the Subsidiaries and the New West Subsidiaries and except
as disclosed on SCHEDULE IC hereto). Each of the Subsidiaries, New
West and the New West Subsidiaries has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
property, or conducts any business, so as to require such qualification
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(except where the failure to so qualify, singly or in the aggregate
with all other such failures, would not have a Material Adverse
Effect).
(e) All of the issued and outstanding shares of capital stock of
the Company have been duly authorized and validly issued, are fully
paid and nonassessable and were not issued in violation of any
preemptive or similar rights and the issuance of the Securities and the
consummation of the transactions contemplated by the Offering Documents
and the Final Offering Memorandum do not give any person the right to
require registration of any securities of the Company, any Subsidiary,
New West or any New West Subsidiary whether under any registration
statement filed pursuant to the Registration Rights Agreement (other
than as expressly permitted thereby) or otherwise.
(f) The Company had at the date indicated in the Final Offering
Memorandum the capitalization set forth in the column entitled "NVAL
Actual" under the caption "Capitalization" as set forth in the Final
Offering Memorandum and, based on the assumptions stated in the Final
Offering Memorandum, the Company would have had on the date indicated
the adjusted capitalization as set forth in the column entitled
"Company Pro Forma" under the caption "Capitalization" as set forth in
the Final Offering Memorandum. Except as described in the Final
Offering Memorandum, all of the issued and outstanding shares of
capital stock of each Subsidiary, New West and each New West Subsidiary
have been duly and validly authorized and issued, are fully paid and
nonassessable, were not issued in violation of preemptive or similar
rights, are owned, with respect to the Subsidiaries (other than New
West and the New West Subsidiaries), by the Company and, with respect
to the New West Subsidiaries, by New West free and clear of all Liens,
and, with respect to the Subsidiaries, New West and the New West
Subsidiaries, will be owned upon consummation of the Merger free and
clear of all Liens. Except as described in the Final Offering
Memorandum, (i) there are no outstanding options, warrants or other
rights to acquire, or instruments convertible into or options to
acquire, or instruments convertible into or exchangeable for, any
shares of capital stock of the Company, any Subsidiary, New West or any
New West Subsidiary and (ii) there are no agreements, understandings or
arrangements relating to the ownership or disposition of any capital
stock in the Company, any Subsidiary, New West or any New West
Subsidiary, the election of directors of the Company, any Subsidiary,
New West or any New West Subsidiary or the governance of the Company's,
any Subsidiary's, New West's or any New West Subsidiary's affairs other
than the Merger Agreement and documents executed pursuant thereto.
(g) The Company, the Guarantors, New West and the New West
Subsidiaries have all requisite corporate power and authority (to the
extent a party thereto) to execute, deliver and perform their
obligations under the Offering Documents, the Merger Agreement and the
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New Credit Agreement and to consummate the transactions contemplated
thereby, including the Tender Offer and the Merger.
(h) This Agreement has been duly and validly authorized, executed
and delivered by the Company and each Guarantor (other than the
delivery by New West and the New West Subsidiaries) and (assuming due
authorization, execution and delivery by the Initial Purchasers) is a
legally valid and binding agreement of the Company and each Guarantor
(or, in the case of New West and the New West Subsidiaries, will be,
when delivered thereby).
(i) The Indenture has been duly and validly authorized by the
Company and each Guarantor and, when executed and delivered by the
Company and each Guarantor on the Delivery Date (or, in the case of New
West and the New West Subsidiaries, upon the consummation of the
Merger) assuming due authorization, execution and delivery by the
Trustee, will be a legally valid and binding agreement of the Company
and each Guarantor, enforceable against the Company and each Guarantor
in accordance with its terms, except that (i) the enforceability
thereof may be limited by applicable bankruptcy, insolvency, reorgani-
zation, moratorium, fraudulent transfer or other similar laws relating
to or affecting creditors' rights generally and (ii) the availability
of equitable remedies may be limited by equitable principles of general
applicability (regardless of whether in a proceeding in equity or at
law). The Indenture meets the requirements for qualification under the
Trust Indenture Act of 1939, as amended (the "TIA"). The Indenture
will conform in all material respects to the description thereof in the
Final Offering Memorandum.
(j) The Notes have been duly and validly authorized by the
Company and, when executed and authenticated in accordance with the
terms of the Indenture and delivered to and paid for by the Initial
Purchasers in accordance with the terms of this Agreement, will be
legally valid and binding obligations of the Company, entitled to the
benefits of the Indenture and enforceable against the Company in
accordance with their terms, except that (i) the enforceability thereof
may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer or other similar laws relating to or
affecting creditors' rights generally and (ii) the availability of
equitable remedies may be limited by equitable principles of general
applicability (regardless of whether considered in a proceeding in
equity or at law). The Notes will conform in all material respects to
the description thereof contained in the Final Offering Memorandum,
and, when issued, will be in the form contemplated by the Indenture.
(k) The Guarantees to be endorsed on the Notes by each Guarantor
have been duly and validly authorized by each Guarantor and, when
executed and delivered in accordance with the terms of the Indenture,
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will be legally valid and binding obligations of such Guarantor,
entitled to the benefits of the Indenture and enforceable against such
Guarantor in accordance with their terms, except that (i) the
enforceability thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent transfer or other
similar laws relating to or affecting creditors' rights generally and
(ii) the availability of equitable remedies may be limited by equitable
principles of general applicability (regardless of whether considered
in a proceeding in equity or at law). The Guarantees will conform in
all material respects to the description thereof contained in the Final
Offering Memorandum.
(l) The Exchange Notes and the Private Exchange Notes and their
respective guarantees have been duly and validly authorized by the
Company and each Guarantor and, when executed, authenticated and
delivered in accordance with the terms of the Indenture and the Regis-
tration Rights Agreement, will be legally valid and binding obligations
of the Company and each Guarantor, entitled to the benefits of the
Indenture and enforceable against the Company and each Guarantor in
accordance with their terms, except that (i) the enforceability thereof
may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer or other similar laws relating to or
affecting creditors' rights generally and (ii) the availability of
equitable remedies may be limited by equitable principles of general
applicability (regardless of whether considered in a proceeding in
equity or at law).
(m) The Registration Rights Agreement has been duly and validly
authorized by the Company and each Guarantor and, when executed and
delivered by the Company and each Guarantor on the Delivery Date (or,
in the case of New West and the New West Subsidiaries, upon the
consummation of the Tender Offer and the Merger) assuming due
authorization, execution and delivery by, and enforceability against,
the Initial Purchasers, will be a legally valid and binding agreement
of the Company and each Guarantor, enforceable against the Company and
each Guarantor in accordance with its terms, except that (i) the
enforceability thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent transfer or other
similar laws relating to or affecting creditors' rights generally,
(ii) the availability of equitable remedies may be limited by equitable
principles of general applicability (regardless of whether considered
in a proceeding in equity or at law) and (iii) rights to indemnity may
be limited by state or federal laws relating to securities or by
policies underlying such laws. The Registration Rights Agreement will
conform in all material respects to the description thereof contained
in the Final Offering Memorandum.
(n) The New Credit Agreement has been duly and validly authorized
by the Company and each of the Guarantors and, when executed and
delivered by the Company and each of the Guarantors on the Delivery
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Date (or, in the case of New West and the New West Subsidiaries, upon
the consummation of the Tender Offer and the Merger), will constitute a
valid and legally binding agreement of the Company and each of the
Guarantors, enforceable against the Company and each of the Guarantors
in accordance with its terms, except that the enforcement thereof may
be subject to (i) bankruptcy, insolvency, reorganization, moratorium or
other similar laws now or hereafter in effect relating to creditors'
rights generally and (ii) general principles of equity and the
discretion of the court before which any proceeding therefor may be
brought. The New Credit Facility will conform in all material respects
to the description thereof contained in the Final Offering Memorandum.
(o) The Merger Agreement has been duly and validly authorized by
the Company, NW Acquisition Corp. and New West and constitutes a valid
and legally binding agreement of the Company, NW Acquisition Corp. and
New West, enforceable against the Company, NW Acquisition Corp. and New
West in accordance with its terms, except that the enforcement thereof
may be subject to (i) bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally and (ii) general principles of equity and
the discretion of the court before which any proceeding therefor may be
brought. The Merger Agreement conforms in all material respects to the
description thereof contained in the Final Offering Memorandum.
(p) None of the Company, the Subsidiaries, New West or the New
West Subsidiaries is (i) in violation of its certificate of
incorporation or bylaws (or similar organizational document), (ii) in
breach or violation of any statute, law, judgment, decree, order, rule
or regulation applicable to any of them or any of their respective
properties or assets, except for any such breach or violation which
would not, individually or in the aggregate, have a Material Adverse
Effect, or (iii) in breach of or default under (nor has any event
occurred which, with notice or passage of time or both, would
constitute a default under) or in violation of any of the terms or
provisions of any indenture, mortgage, deed of trust, loan agreement,
note, lease, license, franchise agreement, permit, certificate,
contract or other agreement or instrument to which any of them is a
party or to which any of them or their respective properties or assets
is subject, except for any such breach, default, violation or event
which would not, individually or in the aggregate, have a Material
Adverse Effect.
(q) The execution, delivery and performance by the Company and
the Guarantors (including New West and the New West Subsidiaries upon
the consummation of the Tender Offer and the Merger) of the Offering
Documents, the Merger Agreement and the New Credit Agreement and the
consummation of the transactions contemplated thereby and by the Final
Offering Memorandum will not (i) conflict with, or result in a breach
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or violation of, any of the terms or provisions of, or constitute a
default under (or, with notice or passage of time or both, constitute a
default under), any indenture, mortgage, deed of trust, license,
permit, loan agreement, lease or other material agreement or instrument
to which the Company, any of the Subsidiaries, New West or any of the
New West Subsidiaries is a party or by which any of them or any of
their respective properties or assets is bound or is subject, (ii)
violate any provision of the certificate of incorporation or the by-
laws or similar organizational documents of the Company, any of the
Subsidiaries, New West or any of the New West Subsidiaries or any
material statute or any material order, rule or regulation of any court
or governmental agency or body having jurisdiction over the Company,
any of the Subsidiaries, New West or any of the New West Subsidiaries
or any of their properties or assets, or (iii) result in or require the
creation or imposition of any Lien, upon or with respect to any of the
properties of the Company, any of the Subsidiaries, New West or any of
the New West Subsidiaries, except as permitted by the terms of the
Indenture. No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body is
required for the issue and sale of the Notes or the Guarantees and the
consummation by the Issuers of the other transactions contemplated
hereby, except such consents, approvals, authorizations, registrations
or qualifications as may be required under state securities or Blue Sky
laws in connection with the offer and sale of the Securities and except
as have been or, by the Delivery Date, shall have been obtained.
(r) No event with respect to the Company or the Guarantors has
occurred and is continuing that, upon issuance of the Notes and the
Guarantees, would (whether or not with the giving of notice and/or the
passage of time and/or the fulfillment of any other requirement)
constitute a default or an event of default as described in the
Indenture.
(s) There are no legal or governmental proceedings pending to
which the Company, any of the Subsidiaries, New West or any of the New
West Subsidiaries is a party or of which any of their respective
properties or assets is the subject which, if determined adversely,
would singly or in the aggregate have a Material Adverse Effect or
which seeks to restrain, enjoin, prevent the consummation of or
otherwise challenge the issuance or sale of the Notes or the
Guarantees to be sold hereunder or the consummation of the transactions
described in or contemplated by the Offering Documents or the Final
Offering Memorandum. To the Issuers' best knowledge, no such proceed-
ings are threatened or contemplated by any governmental agency or body
or any other person. There are no legal or governmental proceedings
involving or affecting the Company, the Subsidiaries, New West or any
of the New West Subsidiaries or any of their properties or assets that
would be required to be described in a prospectus on Form S-1 pursuant
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to the Securities Act that are not described in the Final Offering
Memorandum, nor are there any material contracts or other documents
that would be required to be described in a prospectus on Form S-1
pursuant to the Securities Act that are not described in the Final
Offering Memorandum.
(t) Each of the Company, the Subsidiaries, New West and the New
West Subsidiaries has such permits, licenses, franchises,
authorizations, consents, certificates, orders and clearances
("PERMITS") of governmental or regulatory authorities as are necessary
to own, lease and operate its properties and to conduct its business in
the manner described in the Final Offering Memorandum, subject to such
qualifications as may be set forth in the Final Offering Memorandum;
subject to such qualifications as may be set forth in the Final
Offering Memorandum, each of the Company, the Subsidiaries, New West
and the New West Subsidiaries has fulfilled and performed all its
material obligations with respect to the 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 Permit. Except as
described in the Final Offering Memorandum, none of the Permits
contains any restrictions that materially affect the ability of the
Company, any Subsidiary, New West or any New West Subsidiary to satisfy
its obligations under the Offering Documents or to consummate any of
the transactions described in or contemplated by the Offering Documents
or the Final Offering Memorandum.
(u) Each of Xxxxxx Xxxxxxxx LLP, Xxxxx & Xxxxx LLP and
PricewaterhouseCoopers LLP, who have certified certain financial
statements of the Company, the Subsidiaries, New West, the New West
Subsidiaries, Frame-N-Lens, Inc. ("FNL"), and the FNL subsidiaries
before the acquisition by the Company of FNL (the "FNL SUBSIDIARIES"),
are independent public accountants under rule 101 of AICPA's Code of
Professional Conduct and its interpretation and rulings.
(v) The consolidated financial statements of the Company included
or incorporated by reference in the Final Offering Memorandum present
fairly the financial condition, the results of operations and the cash
flows of the Company and the Subsidiaries as of the dates and for the
periods therein specified in conformity with generally accepted
accounting principles consistently applied throughout the periods
involved, except as otherwise stated therein. The consolidated
financial statements of New West and the related notes thereto included
in the Final Offering Memorandum present fairly in all material
respects the consolidated financial position of New West and its
consolidated subsidiaries, the results of their operations and the
changes in their consolidated cash flow at the dates and for the
periods specified and have been prepared in accordance with generally
accepted accounting principles ("GAAP") applied on a consistent basis,
except as otherwise stated therein. The consolidated financial
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statements of FNL and the related notes thereto included in the Final
Offering Memorandum present fairly in all material respects the
consolidated financial position of FNL and its consolidated
subsidiaries, the results of their operations and the changes in their
consolidated cash flow at the dates and for the periods specified and
have been prepared in accordance with GAAP applied on a consistent
basis, except as otherwise stated therein. The summary and selected
financial and statistical data in the Final Offering Memorandum present
fairly in all material respects the information shown therein and have
been prepared and compiled on a basis consistent with the audited
financial statements included in the Final Offering Memorandum. The
unaudited PRO FORMA financial statements included in the Final Offering
Memorandum (i) comply as to form in all material respects with the
applicable requirements of Regulation S-X promulgated under the
Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission promulgated thereunder (collectively, the
"EXCHANGE ACT"), (ii) have been prepared in accordance with the
Commission's rules and guidelines with respect to PRO FORMA financial
statements and (iii) have been properly computed on the bases described
therein; the assumptions used in the preparation thereof are reasonable
and the adjustments used therein are appropriate to give effect to the
transactions or circumstances referred to therein.
(w) There is no presently existing dispute or controversy between
the Company, any of the Subsidiaries, New West or any of the New West
Subsidiaries on the one hand and any of their respective employees on
the other hand which has had or is likely to have, and the Issuers have
no reason to believe that the relationship of the Company, the
Subsidiaries, New West and the New West Subsidiaries with their unions
or employees is likely to have, a Material Adverse Effect.
(x) The Company, the Subsidiaries, New West and the New West
Subsidiaries own or possess adequate patents, patent rights,
inventions, trademarks, service marks, trade names, copyrights and
know-how necessary to conduct their business as presently conducted as
described in the Final Offering Memorandum. Neither the Company, any
of the Subsidiaries, New West or any of the New West Subsidiaries has
received any notice of infringement of or conflict with asserted rights
of others with respect to any material patent, patent rights, inventions,
trademarks, service marks, trade names, copyrights or know-how which
could reasonably be expected to have a Material Adverse Effect.
(y) The Company, the Subsidiaries, New West and the New West
Subsidiaries have timely filed all federal income and other material
tax returns and notices. The Issuers have no knowledge of any tax
deficiencies which would have a Material Adverse Effect. The Company,
the Subsidiaries, New West and the New West Subsidiaries have paid all
federal, state, local and foreign taxes of any nature which are
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shown on its returns to be due, in each case except as may be set forth
or adequately reserved for in accordance with GAAP in the financial
statements included in the Final Offering Memorandum. The amounts
currently set up as provisions for taxes or otherwise by the Company,
the Subsidiaries, New West and the New West Subsidiaries on their books
and records are materially sufficient for the payment of all their
unpaid federal, foreign, state, county and local taxes accrued through
the dates as of which they relate, and for which the Company, the
Subsidiaries, New West and the New West Subsidiaries may be liable in
their own right, or as a transferee of the assets of, or as successor
to any other corporation, association, partnership, joint venture or
other entity.
(z) Since the date of the most recent financial statements
appearing in the Final Offering Memorandum, except as described
therein, (i) none of the Company, the Subsidiaries, New West or the New
West Subsidiaries has incurred any liabilities or obligations, direct
or contingent, or entered into or agreed to enter into any transactions
or contracts (written or oral) not in the ordinary course of business,
which liabilities, obligations, transactions or contracts would,
individually or in the aggregate, be material to the general affairs,
management, business, condition (financial or otherwise), prospects or
results of operations of the Company, the Subsidiaries, New West and
the New West Subsidiaries, taken as a whole, (ii) none of the Company,
any of the Subsidiaries, New West or the New West Subsidiaries has
purchased any of its outstanding capital stock, nor declared, paid or
otherwise made any dividend or distribution of any kind on its capital
stock (other than, with respect to any of such Subsidiaries, the
purchase of, or dividend or distribution on, capital stock owned by the
Company or a Subsidiary and other than, with respect to any of such New
West Subsidiaries, the purchase of, or dividend or distribution on,
capital stock owned by New West or a New West Subsidiary) and (iii)
there shall not have been any change in the capital stock or long-term
indebtedness of the Company, the Subsidiaries, New West or the New West
Subsidiaries. Since the date as of which information is given in the
Preliminary Offering Memorandum through the date hereof, and except as
may otherwise be disclosed in the Final Offering Memorandum, neither
the Company, any of the Subsidiaries, New West nor any of the New West
Subsidiaries has sold or otherwise disposed of any capital stock of the
Company or the Subsidiaries, directly or indirectly.
(aa) The Company, each Subsidiary, New West and each New West
Subsidiary maintain systems of internal accounting controls sufficient
to provide reasonable assurances that (i) transactions are executed in
accordance with management's general or specific authorization;
(ii) transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally accepted accounting
-13-
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.
(bb) The Issuers, taken as a whole, immediately before and after
the consummation of the transactions contemplated by each of the Merger
Agreement, the New Credit Agreement, this Agreement and the Indenture
and the other transactions contemplated in the Final Offering
Memorandum, will be Solvent. As used herein, the term "SOLVENT" means,
with respect to any such entity on a particular date, (i) the fair
market value of the assets of such entity is greater than the total
amount of liabilities (including contingent liabilities) of such
entity, (ii) the present fair salable value of the assets of such
entity is greater than the amount that will be required to pay the
probable liabilities of such entity on its debts as they become abso-
lute and matured, (iii) such entity is able to realize upon its assets
and pay its debts and other liabilities, including contingent
obligations, as they mature and (iv) such entity does not have an
unreasonably small capital in relation to its operations.
(cc) None of the Issuers or any of their respective affiliates (as
defined in Rule 501(b) of Regulation D under the Securities Act, an
"AFFILIATE") has directly, or through any agent, (i) sold, offered for
sale, solicited offers to buy or otherwise negotiated in respect of,
any security (as defined in the Securities Act) which is or will be
integrated with the sale of the Notes in a manner that would require
the registration under the Securities Act of the Notes or (ii) engaged
in any form of general solicitation or general advertising in
connection with the offering of the Notes (as those terms are used in
Regulation D under the Securities Act) or in any manner involving a
public offering within the meaning of Section 4(2) of the Securities
Act.
(dd) Neither the Company, any of the Subsidiaries, New West nor
any of the New West Subsidiaries has taken or will take any action that
might cause this Agreement or the sale of the Securities to or by the
Initial Purchasers to violate Regulation T, U or X of the Board of
Governors of the Federal Reserve System, in each case as in effect, or
as the same may hereafter be in effect, on the Delivery Date.
(ee) Neither the Company nor any of the Subsidiaries is, or will
be after giving effect to the Offering and the application of the
proceeds therefrom and the other transactions contemplated by the
Offering Documents, an "investment company" or an entity "controlled"
by an "investment company," as such terms are defined in the Investment
Company Act of 1940, as amended (the "INVESTMENT COMPANY ACT").
-14-
(ff) Assuming the representations and warranties of the Initial
Purchasers are true and correct, it is not necessary in connection with
the offer, sale and delivery of the Notes to the Initial Purchasers in
the manner contemplated by this Agreement to register the Notes under
the Securities Act or to qualify the Indenture under the TIA.
(gg) The Company has been advised by the National Association of
Securities Dealers, Inc. Private Offerings, Resales and Trading through
Automated Linkages market ("PORTAL") that the Notes have been
designated PORTAL eligible securities in accordance with the rules and
regulations of the National Association of Securities Dealers, Inc.
(hh) None of the Issuers has taken, nor will take, directly or
indirectly, any action designed to, or that might be reasonably
expected to, cause or result in stabilization or manipulation of the
price of the Securities.
(ii) The statistical and market-related data included in the Final
Offering Memorandum are based on or derived from sources that the
Issuers believe to be reliable and accurate or represent the Issuers'
good faith estimates that are made on the basis of data derived from
such sources.
(jj) Except as would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect (A) each of
the Company, the Subsidiaries, New West and the New West Subsidiaries
is in compliance with and not subject to liability under applicable
Environmental Laws (as defined below), (B) each of the Company, the
Subsidiaries, New West and the New West Subsidiaries has made all
filings and provided all notices required under any applicable
Environmental Law, and has, and is in compliance with, all Permits
required under any applicable Environmental Laws and each of them is in
full force and effect, (C) there is no civil, criminal or
administrative action, suit, demand, claim, hearing, notice of
violation, investigation, proceeding, notice or demand letter or
request for information pending or, to the knowledge of the Company or
any of the Subsidiaries, threatened against the Company, any of the
Subsidiaries, New West or any of the New West Subsidiaries under any
Environmental Law, (D) no lien, charge, encumbrance or restriction has
been recorded under any Environmental Law with respect to any assets,
facility or property owned, operated, leased or controlled by the
Company, the Subsidiaries, New West or any of the New West
Subsidiaries, (E) none of the Company, any of the Subsidiaries, New
West or any of the New West Subsidiaries has received notice that it
has been identified as a potentially responsible party under the
Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended ("CERCLA"), or any comparable state law, (F) no
property or facility of the Company, any of the Subsidiaries, New West
or any of the New West Subsidiaries is (i) listed or proposed for
-15-
listing on the National Priorities List under CERCLA or is (ii) listed
in the Comprehensive Environmental Response, Compensation, Liability
Information System List promulgated pursuant to CERCLA, or on any
comparable list maintained by any state or local governmental
authority.
For purposes of this Agreement, "ENVIRONMENTAL LAWS" means the
common law and all applicable federal, state and local laws or
regulations, codes, orders, decrees, judgments or injunctions issued,
promulgated, approved or entered thereunder, relating to pollution or
protection of public or employee health and safety or the environment,
including, without limitation, laws relating to (i) emissions,
discharges, releases or threatened releases of hazardous materials into
the environment (including, without limitation, ambient air, surface
water, groundwater, land surface or subsurface strata), (ii) the
manufacture, processing, distribution, use, generation, treatment,
storage, disposal, transport or handling of hazardous materials, and
(iii) underground and aboveground storage tanks and related piping, and
emissions, discharges, releases or threatened releases therefrom.
(kk) When the Notes are issued and delivered pursuant to this
Agreement, the Notes will not be of the same class (within the meaning
of Rule 144A under the Securities Act) as securities of the Company
which are listed on a national securities exchange registered under
Section 6 of the Exchange Act or quoted in a U.S. automated interdealer
quotation system.
(ll) The Company, each of the Subsidiaries, New West and each of
the New West Subsidiaries maintain insurance covering their properties,
operations, personnel and businesses. Such insurance insures against
such losses and risks as are adequate in accordance with customary
industry practice to protect the Company, the Subsidiaries, New West
and each of the New West Subsidiaries and their businesses. All such
insurance is outstanding and in force on the date hereof and will be
outstanding and in force on the Delivery Date and immediately after
consummation of the Merger.
(mm) None of the Company, any Subsidiary, New West, any New West
Subsidiary or any of their officers, employees, agents or any other
person acting on behalf of the Company, any Subsidiary, New West or any
New West Subsidiary has, directly or indirectly, given or agreed to
give any money, gift or similar benefit (other than legal price
concessions to customers in the ordinary course of business) to any
customer, supplier, employee or agent of a customer or supplier, or
official or employee of any governmental agency (domestic or foreign)
or instrumentality of any government (domestic of foreign) or any
political party or candidate for office (domestic or foreign) or other
person who was, is, or may be in a position to help or hinder the
-16-
business of the Company, any Subsidiary, New West or any New West
Subsidiary (or assist the Company, any Subsidiary, New West or any New
West Subsidiary in connection with any actual or proposed transaction)
which (a) might subject the Company, any Subsidiary, New West or any
New West Subsidiary or any other such person to any damage or penalty
in any civil, criminal or governmental litigation or proceeding
(domestic or foreign), (b) if not given in the past, might have had a
Material Adverse Effect, or (c) if not continued in the future, might
have a Material Adverse Effect. None of the Company, any Subsidiary,
New West, any New West Subsidiary or any of their officers, employees,
agents or any other person acting on behalf of the Company, any
Subsidiary, New West or any New West Subsidiary has made any payment of
funds prohibited by law, and no funds of the Company, any Subsidiary,
New West or any New West Subsidiary have been set aside to be used for
any payment prohibited by law. The Company's, each Subsidiary's, New
West's and each New West Subsidiary's internal accounting controls are
sufficient to cause the Company, each Subsidiary, New West and each New
West Subsidiary to comply with the Foreign Corrupt Practices Act of
1977, as amended.
(nn) The Company, the Subsidiaries, New West and the New West
Subsidiaries are in compliance in all material respects with all
presently applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended, including the regulations and
published interpretations thereunder ("ERISA"); no "reportable event"
(as defined in ERISA) has occurred with respect to any "pension plan"
(as defined in ERISA) for which the Company, any of the Subsidiaries,
New West or any of the New West Subsidiaries would have any liability;
none of the Company, any of the Subsidiaries, New West or any of the
New West Subsidiaries has incurred or expects to incur liability under
(i) Title IV of ERISA with respect to termination of, or withdrawal
from, any "pension plan" or (ii) Sections 412 or 4971 of the Internal
Revenue Code of 1986, as amended, including the regulations and
published interpretations thereunder (the "Code"); and each "pension
plan" for which the Company, any of the Subsidiaries, New West or any
of the New West Subsidiaries would have any liability that is intended
to be qualified under Section 401(a) of the Code is so qualified in all
material respects and nothing has occurred, whether by action or by
failure to act, which would be expected to cause the loss of such
qualification.
(oo) Except as set forth in the Final Offering Memorandum, there
is no strike, labor dispute, slowdown or work stoppage with the
employees of the Company, any of the Subsidiaries, New West or any of
the New West Subsidiaries which is pending or, to the best knowledge of
the Issuers, threatened.
(pp) None of the Issuers, any of their respective Affiliates or
any person acting on any of their behalf (other than the Initial
Purchasers) has engaged in any directed selling efforts (as that term
-17-
is defined in Regulation S under the Act ("Regulation S")) with respect
to the Securities; the Issuers and their respective Affiliates and any
person acting on any of their behalf (other than the Initial
Purchasers) have complied with the offering restrictions requirement of
Regulation S.
(qq) Each representation and warranty contained in this Agreement
will be true and correct immediately after consummation of each of the
Tender Offer and the Merger.
(rr) All Information Systems and Equipment (as defined below) are
either Year 2000 Compliant (as defined below), or any reprogramming,
remediation, or any other corrective action, including the internal
testing of all such Information Systems and Equipment, will be
completed by June 1, 1999, except insofar as a failure to do so will
not result in a Material Adverse Effect. Further, to the extent that
such reprogramming, remediation and testing is required, the cost
thereof, as well as the cost of the reasonably foreseeable consequences
of failure to become Year 2000 Compliant, to the Company, its
Subsidiaries, New West and the New West Subsidiaries (including,
without limitation, reprogramming errors and the failure of other
systems or equipment) will not result in a Material Adverse Effect.
"YEAR 2000 COMPLIANT" means that all Information Systems and
Equipment accurately process date data (including, but not limited to,
calculating, comparing and sequencing), before, during and after the year
2000, as well as same and multi-century dates, or between the years 1999 and
2000, taking into account all leap years, including the fact that the year
2000 is a leap year, and further, that when used in combination with, or
interfacing with, other Information Systems and Equipment, shall accurately
accept, release and exchange date data, and shall in all material respects
continue to function in the same manner as it performs today and shall not
otherwise impair the accuracy or functionality of Information Systems and
Equipment.
"INFORMATION SYSTEMS AND EQUIPMENT" means all computer hardware,
firmware and software, as well as other information processing systems, and
any equipment containing embedded microchips, whether directly owned,
licensed, leased, operated or otherwise controlled by the Company, any of
its Subsidiaries, New West or any of the New West Subsidiaries, including
through third-party service providers, and which, in whole or in part, are
used, operated, relied upon, or integral to, in the conduct of its business,
any of the Company, any Subsidiaries, New West or any New West Subsidiaries.
Each of the foregoing representations and warranties, as far as
each relates to information concerning New West or the New West
Subsidiaries, is made by the Issuers to the best of their knowledge.
-18-
Any certificate signed by any officer of the Company or any
Subsidiary and delivered to any Initial Purchaser or to counsel for the
Initial Purchasers shall be deemed a representation and warranty by the
Company or such Subsidiary, as the case may be, to each Initial Purchaser as
to the matters covered thereby.
2. On the basis of the representations and warranties contained
in this Agreement, and subject to the terms and conditions herein set forth,
the Issuers agree to issue and sell to the Initial Purchasers, and the
Initial Purchasers agree, severally, to purchase from the Issuers, the
aggregate principal amount of Securities set forth opposite such Initial
Purchaser's name on SCHEDULE II attached hereto, at a purchase price of
95.864% of the principal amount thereof.
3. Certificates in definitive form for the Notes and the
Guarantees to be purchased by you hereunder shall be delivered by or on
behalf of the Issuers to you for your account against payment by you of the
purchase price therefor by wire transfer of immediately available funds to
an account specified by the Company by written notice to the Initial
Purchasers (given at least two business days prior to the Delivery Date),
for the purchase price of the Securities being sold by the Issuers in New
York, New York, at 9:30 A.M., New York City time, on October 8, 1998, or at
such other time, date and place as you and the Company may agree upon in
writing, such time and date being herein called the "DELIVERY DATE."
Certificates for the Notes so to be delivered will be in good
delivery form, and in such denominations and registered in such names as you
may request not less than 48 hours prior to the Delivery Date. Such
certificates will be made available for checking and packaging in New York,
New York, at least 24 hours prior to the Delivery Date.
4. The Initial Purchasers propose to offer the Securities for
resale, as soon as practicable after this Agreement is entered into and as
in the judgment of the Initial Purchasers is advisable, only to certain
investors (as further described in subparagraph (a) of this Section 4) upon
the terms and conditions set forth in this Agreement and the Final Offering
Memorandum initially at the purchase price set forth on the cover page of
the Final Offering Memorandum. Each of the Initial Purchasers hereby
represents and warrants to, severally, and agrees with, the Issuers that:
(a) It is an institutional "accredited investor" (as defined in
501(a)(1), (2), (3) or (7) under the Securities Act) and will offer or
sell the Notes only (i) inside the United States, to persons who it
reasonably believes are "qualified institutional buyers" within the
meaning of Rule 144A in transactions meeting the requirements of Rule
144A and (ii) pursuant to offers and sales that occur outside the
United States within the meaning of Regulation S under the Securities
Act; and
-19-
(b) It has not and will not offer or sell the Notes by any form
of general solicitation or general advertising, including but not
limited to, the methods described in Rule 502(c) under the Securities
Act.
5. In consideration of the agreements of the Initial Purchasers
contained in this Agreement, the Issuers, jointly and severally, covenant
and agree as follows:
(a) The Issuers will furnish to you, without charge, as many
copies of the Final Offering Memorandum and any supplements and
amendments thereto as you may reasonably request.
(b) Before amending or supplementing the Final Offering
Memorandum subsequent to the execution of this Agreement, the Issuers
will furnish to you a copy of each such proposed amendment or
supplement and will not use any such proposed amendment or supplement
to which you reasonably object.
(c) If, at any time prior to the completion of the distribution
of the Securities to persons that are not your affiliates (as
determined by you), any event occurs as a result of which the Final
Offering Memorandum as then amended or supplemented would include any
untrue statement of a material fact, or omit to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if for any
other reason it is necessary at any time to amend or supplement the
Final Offering Memorandum to comply with applicable law, the Issuers
will notify you thereof and will prepare, at the expense of the
Issuers, an amendment or supplement to the Final Offering Memorandum
that corrects such statement or omission or effects such compliance.
(d) The Issuers will endeavor to qualify the Securities for offer
and sale under the securities or Blue Sky laws of such jurisdictions in
the United States as you shall reasonably request; PROVIDED, HOWEVER,
that the Issuers shall not be obligated to file any general consent to
service of process or to qualify as a foreign corporation or as a
dealer in securities in any jurisdiction in which it is not so
qualified or to subject itself to taxation in respect of doing business
in any jurisdiction in which it is not otherwise so subject. The
Issuers will file such statements and reports as may be required by the
laws of each jurisdiction in which the Securities have been qualified
as above provided. The Issuers will also supply you with such
information as is necessary for the determination of the legality of
the Securities in such jurisdictions as you may request.
(e) The Issuers will not, and will not permit any of their
Affiliates to, sell, offer for sale or solicit offers to buy or
otherwise negotiate in respect of any security (as defined in the
-20-
Securities Act) which could be integrated with the sale of the
Securities in a manner which would require the registration under the
Securities Act of the Securities.
(f) Except following the effectiveness of the Exchange Offer
Registration Statement, the Issuers will not solicit any offer to buy
or offer to sell the Securities by means of any form of general
solicitation or general advertising (as those terms are used in
Regulation D under the Securities Act) or in any manner involving a
public offering within the meaning of Section 4(2) of the Securities
Act.
(g) While any of the Securities remain outstanding and are
"restricted securities" within the meaning of Rule 144(a)(3) under the
Securities Act, the Issuers will make available at their expense, upon
request, to any holder, beneficial owner or prospective purchaser of
outstanding Securities the information specified in Rule 144A(d)(4)
under the Securities Act, unless the Company is then subject to
Section 13 or 15(d) of the Exchange Act.
(h) The Issuers will use their best efforts to permit the
Securities to be designated PORTAL securities in accordance with the
rules and regulations adopted by the National Association of Securities
Dealers, Inc. relating to trading in the PORTAL Market and to permit
the Securities to be eligible for clearance and settlement through The
Depository Trust Company.
(i) For so long as the Securities remain outstanding, the Issuers
will furnish to the Initial Purchasers copies of any annual reports,
quarterly reports and current reports filed with the Commission on
Forms 10-K, 10-Q and 8-K, or such other similar forms as may be
designated by the Commission, and such other documents, reports and
information as shall be furnished by the Issuers to the Trustee or to
the holders of the Notes pursuant to the Indenture.
(j) The Issuers will not, and will not permit any of their
Affiliates to, resell any Securities that have been acquired by any of
them.
(k) The Issuers will use the proceeds from the sale of the
Securities in the manner set forth in the Final Offering Memorandum and
in a manner that will not result in the Issuers becoming an investment
company within the meaning of the Investment Company Act, and the rules
and regulations of the Commission thereunder.
(l) The Company will not, and will cause each of the Subsidiaries
not to, offer, sell, contract to sell or grant any option to purchase
or otherwise transfer or dispose of any debt security, or any security
convertible into or in exchange for, any such debt security of the
-21-
Company or any such Subsidiary (other than (x) any private loan, credit
or financing agreement with a bank or similar institution and (y) the
Notes, the Exchange Notes and the Private Exchange Notes), for a period
of 180 days after the date of this Agreement, without the prior
written consent of Xxxxxxxx & Co. Inc.
(m) Prior to the Delivery Date, the Company will furnish to the
Initial Purchasers, as soon as they have been prepared by or are
available to the Company, a copy of any unaudited interim consolidated
financial statements of the Company for any period subsequent to the
period covered by its most recent financial statements appearing in the
Final Offering Memorandum.
(n) The Company will use reasonable efforts to consummate the
Xxxxxx as soon as practicable after the Delivery Date, taking into
account all relevant factors, including successful operation of the
Company's business.
(o) Upon the consummation of the Tender Offer and the Merger, the
Issuers shall cause New West and the New West Subsidiaries to become
Guarantors pursuant to the Indenture and they shall each execute and
deliver the Guarantee, the Indenture, the New Credit Agreement, this
Agreement and the Registration Rights Agreement as of the respective
dates of such documents.
(p) On or prior to November 30, 1998, (i) the Tender Offer shall
have been consummated in accordance with the Offer to Purchase and all
applicable laws, (ii) the Company shall have purchased that number of
shares sufficient to satisfy the minimum tender conditions in the Offer
to Purchase in accordance with the terms and conditions set forth in
the Offer to Purchase and (iii) such tendered shares shall be
transferable to the purchaser with good title and shall be free and
clear of Liens and encumbrances created by the Company or its
affiliates. After giving effect to the consummation of the purchase of
the shares pursuant to the Tender Offer, the Company shall own and
control that number of shares as shall be necessary to permit the
Company to approve the Merger either with or without the affirmative
vote or approval of the shareholders of New West, and there shall be no
applicable statute or other restriction (other than provisions of the
Delaware General Corporation Law and proxy rules under Section 14 of
the Exchange Act) which would prohibit, materially restrict or
materially delay the consummation of the Merger or would be reasonably
likely to make the consummation of the Merger economically unfeasible.
In addition, any state anti-takeover law regulating the Merger shall
have been complied with or shall have been determined by the Initial
Purchasers to be invalid or inapplicable to the Tender Offer and the
Merger. At the time of the consummation of the Tender Offer, no fair
price provisions under applicable law shall require a higher price be
paid for shares in the Tender Offer, which price, in any event, shall
not exceed that amount set forth in the Offer to Purchase and the
-22-
Merger Agreement as in effect at the time of the consummation of the
Merger.
(q) The Issuers will ensure that their Information Systems and
Equipment are at all times after June 1, 1999 Year 2000 Compliant,
except insofar as a failure to do so will not result in a Material
Adverse Effect.
6. The Issuers, jointly and severally, covenant and agree that
the Issuers will pay or cause to be paid: (i) the fees, disbursements and
expenses of counsel and accountants for the Issuers and the Trustee and its
counsel, and all other expenses, in connection with the preparation and
printing of each Memorandum and amendments and supplements thereto and the
furnishing of copies thereof, including charges for mailing, air freight and
delivery and counting and packaging thereof to the Initial Purchasers and
dealers; (ii) all expenses in connection with the qualification of the
Securities for offering and sale under state securities laws as provided in
Section 5(d) hereof, including disbursements and expenses for counsel for
the Initial Purchasers in connection with such qualification and in
connection with Blue Sky surveys; (iii) any fees charged by rating agencies
for the rating of the Securities; (iv) the costs and expenses in connection
with the preparation and delivery of the Securities; and (v) all other costs
and expenses incident to the performance of its obligations hereunder which
are not otherwise specifically provided for in this Section 6, including the
fees, if any, incurred in connection with the admission of the Securities
for trading in any appropriate market systems, the cost of the Issuers'
personnel and other internal costs, the cost of printing and engraving the
certificates representing the Securities and all expenses and property,
excise and similar taxes incident to the sale and delivery of the Securities
to be sold by the Issuers to the Initial Purchasers hereunder.
7. Your obligations hereunder shall be subject, in your
discretion, to the following additional conditions:
(a) The representations and warranties of the Issuers contained
in this Agreement shall be true and correct as of the date hereof and
as of the Delivery Date. The Issuers shall have performed in all
material respects all covenants and agreements and satisfied in all
material respects all conditions on their part to be performed or
satisfied hereunder at or prior to the Delivery Date.
(b) The sale of the Securities by the Issuers hereunder shall not
be enjoined (temporarily or permanently) on the Delivery Date.
(c) Subsequent to the date as of which information is given in
the Final Offering Memorandum, except in each case as described in or
as contemplated by the Final Offering Memorandum, the Company, the
Subsidiaries, New West and the New West Subsidiaries shall not have
-23-
incurred any liabilities or obligations, direct or contingent that are
material to the Company, the Subsidiaries, New West and the New West
Subsidiaries taken as a whole or entered into any transactions that are
material to the business, condition (financial or other), results of
operations or prospects of the Company, the Subsidiaries, New West and
the New West Subsidiaries taken as a whole.
(d) Subsequent to the date of this Agreement and prior to the
Delivery Date, there shall not have occurred any downgrading, nor shall
any notice have been given of any intended or potential downgrading or
of any review for a possible change that does not indicate the
direction of the possible change, in the rating accorded any of the
Issuers' securities, including the Securities, by any "nationally
recognized statistical rating organization" as such term is defined for
purposes of Rule 436(g)(2) under the Securities Act.
(e) You shall have received on the Delivery Date a certificate of
each of the Issuers dated the Delivery Date and signed by its Chief
Executive Officer, President or any Vice President and by the Chief
Financial Officer, to the effect set forth in clauses (a), (b), (c) and
(d) above.
(f) Xxxxxxxxxx Xxxxxxxx LLP, counsel to the Issuers, shall have
furnished to you their written opinion, dated the Delivery Date, in
substantially the form attached hereto as EXHIBIT B, portions of which
opinion reasonably satisfactory to you may be rendered by Xxxxxxx
Xxxxxxx & Xxxxxx, P.L.L. counsel to New West, Gray Xxxx Xxxx
Freidenrich LLP, counsel to Frame-n-Lens, Inc., or Xxxxxxxx Xxxxxxx,
General Counsel to the Company.
(g) Xxxxxx Xxxxxx & Xxxxxxx, counsel to the Initial Purchasers,
shall have furnished to the Initial Purchasers a written opinion, dated
the Delivery Date, in form and substance satisfactory to you, and such
counsel shall have received such papers and information as they may
reasonably request to enable them to pass upon the matters covered by
such opinion.
(h) You shall have received on each of the date hereof and the
Delivery Date letters, dated the date hereof or the Delivery Date, as
the case may be, in form and substance reasonably satisfactory to you,
from Xxxxxx Xxxxxxxx LLP, Xxxxx & Xxxxx LLP and PricewaterhouseCoopers
LLP, the Company's and the Subsidiaries' independent public
accountants.
(i) (i) Since the date of this Agreement, neither the Company,
any of the Subsidiaries, New West nor any of the New West Subsidiaries
shall have sustained any loss or interference with its business from
-24-
fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action,
order or decree which could reasonably be expected to have a Material
Adverse Effect; and (ii) since the respective dates as of which
information is given in the Final Offering Memorandum, there shall not
have been any change in the capital stock or short-term debt (other
than in the ordinary course of business) or long-term debt of the
Company, any of the Subsidiaries, New West or any of the New West
Subsidiaries nor any change which could reasonably be expected to have
a Material Adverse Effect otherwise than as set forth or contemplated
in the Final Offering Memorandum, the effect of which, in any such case
described in clause (i) or (ii), is in your judgment so material and
adverse as to make it impracticable or inadvisable to proceed with the
Offering or the delivery of the Notes on the terms and in the manner
contemplated in the Final Offering Memorandum.
(j) Subsequent to the execution and delivery of this Agreement,
(i) there shall have been no declaration of war by the Government of
the United States, (ii) there shall not have occurred any material
adverse change in the financial or securities markets in the United
States or in political, financial or economic conditions in the United
States or any outbreak or material escalation of hostilities or other
calamity or crisis, the effect of which is such as to make it, in the
reasonable judgment of the Initial Purchasers, impracticable to market
the Securities or to enforce contracts for the resale of Securities and
(iii) no event shall have occurred resulting in (A) trading in
securities generally on the New York Stock Exchange, the American Stock
Exchange or the Nasdaq National Market being suspended or limited or
minimum or maximum prices being generally established on such exchange
or market, or (B) additional material governmental restrictions, not in
force on the date of this Agreement, being imposed upon trading in
securities generally by such exchange or by order of the Commission or
any court or other governmental authority or (C) a general banking
moratorium being declared by either Federal or New York authorities.
(k) The Issuers shall have furnished or caused to be furnished to
you at the Delivery Date any additional certificates signed by officers
of the Issuers, reasonably satisfactory to you as to such matters as
you may reasonably request.
(l) On the Delivery Date, the Initial Purchasers shall have
received the Registration Rights Agreement executed by each of the
Issuers (other than New West and the New West Subsidiaries) and such
agreement shall be in full force and effect at all times from and after
the Delivery Date.
(m) On the Delivery Date, the Indenture shall have been duly
executed and delivered by each Issuer (other than New West and the New
West Subsidiaries) and the Trustee, and the Notes shall have been duly
-25-
executed by the Company and shall have been duly authenticated by the
Trustee.
(n) On the Delivery Date, Guarantees shall have been duly
executed and delivered by the Guarantors (other than New West and the
New West Subsidiaries).
(o) Before or on the Delivery Date, the Company and the
Guarantors (other than New West and the New West Subsidiaries) shall
have entered into the New Credit Agreement on terms and conditions
described in the Final Offering Memorandum or that are satisfactory to
the Initial Purchasers.
(p) The Company and the Guarantors shall have duly executed and
delivered this Agreement (other than New West and the New West
Subsidiaries).
(q) On the Delivery Date, the Initial Purchasers shall have
received a true and correct copy of the Merger Agreement and any
schedules and amendments thereto, and there shall have been no material
amendments, alterations, modifications or waivers of any provisions of
the Merger Agreement since the date of this Agreement.
(r) All actions contemplated by the Merger Agreement to be
consummated on or prior to the Delivery Date shall have been
consummated in accordance with the provisions of such agreement.
8. (a) The Issuers jointly and severally agree to indemnify and
hold harmless the Initial Purchasers against any losses, claims, damages or
liabilities ("LOSSES") to which the Initial Purchasers may become subject,
under the Securities Act, the Exchange Act, any other federal or state
statutory law or regulation, at common law or otherwise, insofar as such
Losses (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact contained in
any Memorandum, or any amendment or supplement thereto, or the omission or
alleged omission to state therein a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, and will reimburse the Initial Purchasers for any
legal or other expenses reasonably incurred by the Initial Purchasers in
connection with investigating, preparing to defend, defending or appearing
as a third-party witness in connection with any such action or claim;
PROVIDED FURTHER, HOWEVER, that the Issuers shall not be liable to the
Initial Purchasers in any such case to the extent that any such Loss arises
out of or is based upon an untrue statement or alleged untrue statement or
omission or alleged omission relating to the Initial Purchasers made in any
Memorandum, or such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by or on behalf
of the Initial Purchasers expressly for use therein; PROVIDED, HOWEVER, that
-26-
the foregoing indemnity with respect to the Preliminary Offering Memorandum
shall not inure to the benefit of the Initial Purchasers if the person
asserting such losses, claims, damages or liabilities purchased Securities
and (x) it is established in the related proceeding that such Initial
Purchasers failed to send or give a copy of the Final Offering Memorandum to
such person with or prior to the written confirmation of such sale (provided
that the Issuers have complied with their obligations under Section 5(a)
hereof) and (y) the untrue statement or omission or alleged untrue statement
or omission was completely corrected in the Final Offering Memorandum and
the Final Offering Memorandum does not contain any other untrue statement or
omission or alleged untrue statement or omission that was the subject matter
of the related proceeding.
(b) In addition to any obligations of the Issuers under Section
8(a), each of the Issuers agrees that it shall perform its indemnification
obligations under Section 8(a) (as modified by the last paragraph of this
Section 8(b)), with respect to counsel fees and expenses and other expenses
reasonably incurred by making payments within 45 days to the Initial
Purchasers in the amount of the statements of the Initial Purchasers'
counsel or other statements which shall be forwarded by the Initial
Purchasers, and that it shall make such payments notwithstanding the absence
of a judicial determination as to the propriety and enforceability of the
obligation to reimburse the Initial Purchasers for such expenses and the
possibility that such payments might later be held to have been improper by
a court and a court orders return of such payments.
The indemnity agreement in Section 8(a) shall be in addition to
any liability which the Issuers may otherwise have and shall extend upon the
same terms and conditions to each person, if any, who controls the Initial
Purchasers within the meaning of the Securities Act or the Exchange Act, and
to the officers, directors, partners, employees, representatives and agents
of the Initial Purchasers or any such control person.
(c) The Initial Purchasers will indemnify and hold harmless the
Issuers against any Losses to which the Issuers may become subject, under
the Securities Act, the Exchange Act, any federal or state statutory law or
regulation, at common law or otherwise, insofar as such Losses (or actions
in respect thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in any Memorandum, or
any amendment or supplement thereto, or the omission or alleged omission to
state therein a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading,
in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was
made in any Memorandum or such amendment or supplement in reliance upon and
in conformity with written information furnished to the Issuers by or on
behalf of the Initial Purchasers relating to the Initial Purchasers
expressly for use therein, and will reimburse the Issuers for any legal or
other expenses reasonably incurred by the Issuers in connection with
-27-
investigating, preparing to defend, defending or appearing as a third-party
witness in connection with any such action or claim.
In addition to any obligations of the Initial Purchasers under the
preceding paragraph, each of the Initial Purchasers severally agrees that it
shall perform its indemnification obligations under the preceding paragraph
(as modified by the last paragraph of this Section 8(c)), with respect to
counsel fees and expenses and other expenses reasonably incurred by making
payments within 45 days to the Issuers in the amount of the statements of
the Issuers' counsel or other statements which shall be forwarded by the
Issuers, and that it shall make such payments notwithstanding the absence of
a judicial determination as to the propriety and enforceability of the
obligation to reimburse the Issuers for such expenses and the possibility
that such payments might later be held to have been improper by a court and
a court orders return of such payments.
The indemnity agreement in this Section 8(c) shall be in addition
to any liability which the Initial Purchasers may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls the Issuers within the meaning of the Securities Act or the
Exchange Act, and to the officers, directors, partners, employees,
representatives and agents of the Issuers or any such control person.
(d) Promptly after receipt by an indemnified party under Section
8(a) or 8(c) of notice of the commencement of any action (including any
governmental investigation), such indemnified party shall, if a claim in
respect thereof is to be made against the indemnifying party under such
subsection, notify the indemnifying party in writing of the commencement
thereof; but the omission so to notify the indemnifying party shall not
relieve it from any liability which it may have to any indemnified party
under Section 8(a) or 8(c) except to the extent it was unaware of such
action and has been prejudiced in any material respect by such failure or
from any liability which it may have to any indemnified party otherwise than
under such Section 8(a) or 8(c). In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of
the commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof,
with counsel reasonably satisfactory to such indemnified party, and after
notice from the indemnifying party to such indemnified party of its election
so to assume the defense thereof, the indemnifying party shall not be liable
to such indemnified party under such subsection for any legal or other
expenses subsequently incurred by such indemnified party in connection with
the defense thereof other than reasonable costs of investigation. If,
however, (i) the indemnifying party has not authorized the employment of
counsel for the indemnified party at the expense of the indemnifying party
or (ii) an indemnified party shall have reasonably concluded that
representation of such indemnified party and the indemnifying party by the
same counsel would be inappropriate under applicable standards of
professional conduct due to actual or potential differing interests between
-28-
them, and the indemnified party so notifies the indemnifying party, then the
indemnified party shall be entitled to employ counsel different from counsel
for the indemnifying party at the expense of the indemnifying party and the
indemnifying party shall not have the right to assume the defense of such
indemnified party. In no event shall the indemnifying parties be liable for
fees and expenses of more than one counsel (in addition to local counsel)
for all indemnified parties in connection with any one action or separate
but similar or related actions in the same jurisdiction arising out of the
same set of allegations or circumstances. The counsel with respect to which
fees and expenses shall be so reimbursed shall be designated in writing by
the Initial Purchasers in the case of parties indemnified pursuant to
Section 8(a) and by the Issuers in the case of parties indemnified pursuant
to Section 8(c).
The Issuers shall not be liable for any settlement of any such
action or proceeding effected without its prior written consent (not to be
unreasonably withheld) and if settled with its written consent or if there
is a final judgment for the plaintiff, the Issuers jointly and severally
agree to indemnify and hold harmless the Initial Purchasers and each other
person referred to in Section 8(b) to the extent provided herein. Without
limiting the generality of the foregoing, no indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of which any
such indemnified party is or has been threatened to be made a party and to
which the indemnity herein is applicable; PROVIDED, HOWEVER, that an
indemnifying party may effect such a settlement without the consent of the
indemnified party if such settlement includes an unconditional release of
such indemnified party from all liability for claims that are the subject
matter of such proceeding or the indemnifying party indemnifies the
indemnified party in writing and posts a bond for an amount equal to the
maximum liability for all such claims as contemplated above.
(e) In the event that the indemnity provided by Section 8(a) or
8(c) is unavailable or insufficient to hold harmless an indemnified party
for the matters covered by such Sections for any reason, the Issuers and the
Initial Purchasers shall contribute to the aggregate Losses to which they
may be subject as an indemnifying party hereunder (after contribution from
others) in such proportion so that the Initial Purchasers are responsible
for the portion represented by the percentage that the total discounts and
commissions paid to the Initial Purchasers appearing on the cover page of
the Final Offering Memorandum bears to the total proceeds to the Issuers
(net of discounts and commissions of the Initial Purchasers) appearing
thereon and the Issuers jointly and severally are responsible for the
remaining portion; PROVIDED, HOWEVER, that, in any such case, (x) the
Initial Purchasers shall not be required to contribute any amount in excess
of the Initial Purchasers' discount and commission applicable to the
Securities and (y) no person guilty of a fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be
entitled to a contribution from any person who was not guilty of such
-29-
fraudulent misrepresentation. The amount paid or payable by the Initial
Purchasers as result of this Section 8(e) shall be deemed to include any
legal or other expenses reasonably incurred by the Initial Purchasers or the
Issuers, as the case may be, in connection with investigating, preparing to
defend or defending any such claim.
9. The respective indemnities, agreements, representations,
warranties and other statements of the Issuers and the Initial Purchasers,
as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and
effect, regardless of any investigation (or any statement as to the results
thereof) made by or on behalf of the Initial Purchasers or any controlling
person of the Initial Purchasers, the Issuers or an officer or director or
controlling person of the Issuers and shall survive delivery of and payment
for the Securities.
10. The obligations of the Initial Purchasers hereunder may be
terminated by the Initial Purchasers by notice given to and received by the
Issuers prior to delivery of and payment for the Securities, if, prior to
that time, any of the events described in Section 7(d), 7(i), or 7(j) shall
have occurred or if the Initial Purchasers shall decline to purchase the
Securities for any other reason permitted under this Agreement.
11. If (a) the Issuers shall fail to tender the Notes for
delivery to the Initial Purchasers (other than by reason of a default by the
Initial Purchasers) or (b) the Initial Purchasers shall decline to purchase
the Securities for any reason permitted under this Agreement (including the
termination of this Agreement pursuant to Section 10), the Issuers shall
reimburse the Initial Purchasers for the reasonable fees and expenses of
their counsel and for such other reasonable out-of-pocket expenses as shall
have been incurred by them in connection with this Agreement and the
proposed purchase of the Securities, and upon demand the Issuers shall pay
the full amount thereof to the Initial Purchasers.
12. All statements, requests, notices and agreements hereunder
shall be in writing or by written telecommunication, and shall be sufficient
in all respects if delivered or sent by registered mail, if to the Initial
Purchasers, to Xxxxxxxx & Co., Inc., NationsBanc Xxxxxxxxxx Securities LLC,
First Union Capital Markets, c/x Xxxxxxxx & Co. Inc. at 000 Xxxxxxx Xxxxxx,
Xxx Xxxx, XX 00000, Attention: High Yield Department; and if to the
Issuers, to National Vision Associates, Ltd., 000 Xxxxxxx Xxxxxxx,
Xxxxxxxxxxxxx, XX 00000-0000, Attention: Chief Executive Officer.
13. This Agreement shall be binding upon, and inure solely to the
benefit of, you, the Issuers and, to the extent provided in Section 8
hereof, controlling persons, officers, directors, partners, employees,
representatives and agents referred to in Section 8, and their respective
heirs, executors, administrators, successors and assigns, and no other per-
son shall acquire or have any right under or by virtue of this Agreement.
-30-
No purchaser of any of the Securities from the Initial Purchasers shall be
deemed a successor or assign by reason merely of such purchase.
14. Time shall be of the essence of this Agreement.
15. THE VALIDITY AND INTERPRETATION OF THIS AGREEMENT, AND THE
TERMS AND CONDITIONS SET FORTH HEREIN 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 WHOLLY THEREIN, WITHOUT GIVING EFFECT TO ANY
PROVISIONS THEREOF RELATING TO CONFLICTS OF LAW. EACH OF THE PARTIES HERETO
AGREES TO SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK
AND THE U.S. FEDERAL COURTS SITTING IN THE CITY OF NEW YORK FOR PURPOSES OF
ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT,
THE INDENTURE OR THE REGISTRATION RIGHTS AGREEMENT. NOTHING HEREIN SHALL
AFFECT THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR
SHALL LIMIT THE RIGHT OF THE INITIAL PURCHASERS TO BRING PROCEEDINGS AGAINST
THE COMPANY AND/OR ANY GUARANTOR IN THE COURTS OF ANY OTHER JURISDICTION.
16. This Agreement may be executed by any one or more of the
parties hereto in any number of counterparts, each of which shall be deemed
to be an original, but all such counterparts shall together constitute one
and the same instrument.
17. Each Guarantor, by its execution and delivery of a
counterpart to this Agreement, agrees that it shall be jointly and severally
liable for all obligations and liabilities of the Company hereunder.
If the foregoing is in accordance with your understanding, please
sign and return to us a counterpart hereof, and upon the acceptance hereof
by you, this letter and such acceptance hereof shall constitute a binding
agreement among you, the Company and the Guarantors.
Very truly yours,
THE COMPANY:
NATIONAL VISION ASSOCIATES, LTD.
By: /s/ Xxxxxxxx Xxxxxxx
------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Vice President
THE GUARANTORS:
MIDWEST VISION, INC.
By: /s/ Xxxxxxxx Xxxxxxx
------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Vice President
NVAL HEALTHCARE SYSTEMS, INC.
By: /s/ Xxxxxxxx Xxxxxxx
------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Vice President
INTERNATIONAL VISION ASSOCIATES,
LTD.
By: /s/ Xxxxxxxx Xxxxxxx
------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Vice President
FRAME-N-LENS OPTICAL, INC.
By: /s/ Xxxxxxxx Xxxxxxx
------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Vice President
VISION ADMINISTRATORS, INC.
By: /s/ Xxxxxxxx Xxxxxxx
------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Vice President
NW ACQUISITION CORP.
By: /s/ Xxxxxxxx Xxxxxxx
------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Vice President
INTERNATIONAL VISION ASSOCIATES
OF CANADA LTD.
By: /s/ Xxxxxxxx Xxxxxxx
------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Vice President
INTERNATIONAL VISION ASSOCIATES
OF ONTARIO LTD.
By: /s/ Xxxxxxxx Xxxxxxx
------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Vice President
FAMILY VISION CENTERS, INC.
By: /s/ Xxxxxxxx Xxxxxxx
------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Vice President
Accepted as of the date hereof:
XXXXXXXX & CO. INC.
By: /s/ Xxxxxxx X. Xxxx XX
---------------------------
Name: Xxxxxxx X. Xxxx, XX
Title: Director
NATIONSBANC XXXXXXXXXX SECURITIES LLC
By: /s/ Xxxxx X. Xxxxxxxx
---------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Managing Director
FIRST UNION CAPITAL MARKETS
By: /s/ Xxxxx X. Xxxxx
---------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President
The foregoing Purchase Agreement is hereby
agreed to and accepted as of the date of such
Agreement:
Date: October 23, 1998
The Guarantors:
NEW WEST EYEWORKS, INC.
By: /s/ Xxxxxxxx Xxxxxxx
Name: Xxxxxxxx Xxxxxxx
Title:
ALEXIS HOLDING COMPANY, INC.
By: /s/ Xxxxxxxx Xxxxxxx
Name: Xxxxxxxx Xxxxxxx
Title:
VISTA EYECARE NETWORK, LLC
By: /s/ Xxxxxxxx Xxxxxxx
Name: Xxxxxxxx Xxxxxxx
Title:
Schedule IA
-----------
Company Subsidiaries
--------------------
International Vision Associates, Ltd.
Mexican Vision Associates, S.A. de C.V.
Mexican Vision Associates Operadora, S. de X.X. de C.V.
Mexican Vision Associates Servicios, S. de X.X. de C.V.
Midwest Vision, Inc.
NVAL Healthcare Systems, Inc.
NVAL Visioncare Systems of California, Inc.
NVAL Visioncare Systems of North Carolina, Inc.
Frame-n-Lens Optical, Inc.
Vision Administrators, Inc.
ProCare Eye Exam, Inc.
Family Vision Centers, Inc.
NW Acquisition Corp.
National Vision Associates of Canada Ltd.
International Vision Associates of Canada Ltd.
International Vision Associates of Ontario Ltd.
International Vision Associates (Netherlands) B.V.
CECIVA B.V.
Czech Vision Associates s.r.o.
Slovak Vision Associates s.r.o.
Schedule IB
-----------
New West Subsidiaries
---------------------
Alexis Holding Company, Inc.
Vista Eyecare Network, LLC
Schedule IC
-----------
New West Joint Venture
----------------------
Eye Care Partners
Schedule II
-----------
Principal Amount
Initial Purchaser of Notes
----------------- ----------------
Xxxxxxxx & Co. Inc. $ 75,000,000
NationsBanc Xxxxxxxxxx Securities LLC 25,000,000
First Union Capital Markets 25,000,000
-------------
Total . . . . . . . . . . . . $ 125,000,000
=============
Exhibit A to
Purchase Agreement
------------------
Registration Rights Agreement
-----------------------------
Exhibit B to
Purchase Agreement
------------------
1
Opinion of Company Counsel
-------------------------
1. The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of Georgia,
with all necessary corporate power and authority to own its properties and
to conduct its business as described in each Memorandum. Except as
described in the Final Offering Memorandum, each of the domestic
Subsidiaries is wholly owned directly or indirectly by the Company and each
of the New West Subsidiaries is wholly owned directly or indirectly by New
West. Each of the domestic Subsidiaries, New West and the New West
Subsidiaries has been duly incorporated and is validly existing as a
corporation in good standing under the laws of its jurisdiction of
incorporation, with all necessary corporate power and authority to own its
properties and conduct its business as described in the Final Offering
Memorandum. To our best knowledge, none of the Company, the Subsidiaries,
New West, or the New West Subsidiaries owns, directly or indirectly, any
shares of capital stock or any other equity or long-term debt securities or
has any equity interest in any firm, partnership, joint venture or other
entity (except for the Subsidiaries and the New West Subsidiaries). Each of
the Company, the Subsidiaries, New West and the New West Subsidiaries is
duly qualified as a foreign corporation for the transaction of business and
is in good standing under the laws of the respective jurisdictions listed in
Schedule A attached hereto. The preceding sentence is based solely upon
certificates provided by agencies of those jurisdictions, copies of which
have been delivered to the Initial Purchasers or their counsel, and is
limited to the meaning ascribed to such certificates by each applicable
agency.
2. All of the issued and outstanding shares of capital stock of
the Company have been duly authorized and validly issued (without expressing
any opinion with respect to compliance with federal and state securities
laws), are fully paid and nonassessable and were not issued in violation of
any preemptive or similar rights and the issuance of the Securities and the
consummation of the transactions contemplated by the Offering Documents and
the Final Offering Memorandum do not give any person the right to require
registration of any securities of the Company, any Subsidiary, New West or
any New West Subsidiary whether under any registration statement filed
_________________________
1 Capitalized terms not defined herein have the meaning given to them in
the Purchase Agreement.
-2-
pursuant to the Registration Rights Agreement (other than as expressly
permitted thereby) or otherwise.
3. As of the date of the Final Offering Memorandum, the Company
had authorized capital stock consisting of 100,000,000 shares of Common
Stock, $0.01 par value, with attached rights to purchase Preferred Stock
upon the occurrence of certain events, and 500,000 shares of Preferred
Stock, $1.00 par value. Except as described in the Final Offering
Memorandum, all of the issued and outstanding shares of capital stock of
each domestic Subsidiary, New West and each New West Subsidiary have been
duly and validly authorized and issued, are fully paid and nonassessable,
were not issued in violation of preemptive or similar rights, to our
knowledge are owned, with respect to the domestic Subsidiaries (other than
New West and the New West Subsidiaries), by the Company or a Subsidiary and,
with respect to the New West Subsidiaries, by New West, free and clear of
all Liens, and, with respect to the domestic Subsidiaries, New West and the
New West Subsidiaries, to our knowledge will be owned upon consummation of
the Merger free and clear of all Liens. Except as described in the Final
Offering Memorandum, there are no outstanding options, warrants or other
rights to acquire, or instruments convertible into or options to acquire, or
instruments convertible into or exchangeable or, any shares of capital stock
of the Company, any domestic Subsidiary, New West or any New West Subsidiary.
4. The Company, the Guarantors, New West and the New West
Subsidiaries have all requisite corporate power and authority (to the extent
a party thereto) to execute, deliver and perform their obligations under the
Offering Documents, the Merger Agreement and the New Credit Agreement and to
consummate the transactions contemplated thereby, including the Tender Offer
and the Merger.
5. The Purchase Agreement has been duly and validly authorized,
executed and delivered by the Company and each Guarantor (other than the
execution and delivery by New West and the New West Subsidiaries), and
(assuming due authorization, execution and delivery by the Initial
Purchasers) is a legally valid and binding agreement of the Company and each
Guarantor (or, in the case of New West and the New West Subsidiaries, will
be, when executed and delivered thereby).
6. The Indenture has been duly and validly authorized, executed
and delivered by the Company and each Guarantor (other than the execution
and delivery by New West and the New West Subsidiaries) and assuming due
authorization, execution and delivery by the Trustee, is a legally valid and
binding agreement of the Company and each Guarantor (or, in the case of New
West and the New West Subsidiaries, will be, when executed and delivered
thereby) enforceable against the Company and each Guarantor in accordance
with its terms, except (i) that the enforceability thereof may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer or other similar laws relating to or affecting creditors' rights
-3-
generally and (ii) for general principles of equity, including without
limitation, concepts of reasonableness, good faith and fair dealing and the
possible unavailability of specific performance ot injunctive relief
(regardless of whether in a proceeding in equity or at law). The Indenture
meets the requirements for qualification under the Trust Indenture Act of
1939, as amended (the "TIA"). The Indenture conforms in all material
respects to the description thereof in the Final Offering Memorandum.
7. The Notes have been duly and validly authorized and executed
by the Company and, assuming due authentication by the Trustee, when
delivered to and paid for by the Initial Purchasers in accordance with the
terms of the Purchase Agreement, will be legally valid and binding
obligations of the Company, entitled to the benefits of the Indenture and
enforceable against the Company in accordance with their terms, except
(i) that the enforceability thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent transfer or other similar
laws relating to or affecting creditors' rights generally and (ii) for
general principles of equity, including without limitation, concepts of
reasonableness, good faith and fair dealing and the possible unavailability
of specific performance ot injunctive relief (regardless of whether
considered in a proceeding in equity or at law). The Notes conform in all
material respects to the description thereof contained in the Final Offering
Memorandum, and are in the form contemplated by the Indenture.
8. The Guarantees to be endorsed on the Notes by each Guarantor
have been duly and validly authorized, executed and delivered in accordance
with the terms of the Indenture by each Guarantor (other than the execution
and delivery by New West and the New West Subsidiaries), and each is the
legally valid and binding obligation of such Guarantor (or, in the case of
New West and the New West Subsidiaries, will be, when executed and delivered
thereby), entitled to the benefits of the Indenture and enforceable against
such Guarantor in accordance with their terms, except (i) that the
enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer or other similar laws
relating to or affecting creditors' rights generally and (ii) for general
principles of equity, including without limitation, concepts of
reasonableness, good faith and fair dealing and the possible unavailability
of specific performance ot injunctive relief (regardless of whether considered
in a proceeding in equity or at law). The Guarantees conform in all material
respects to the description thereof contained in the Final Offering Memorandum.
9. The Exchange Notes and the Private Exchange Notes have been
duly and validly authorized by the Company and the respective guarantees
thereof have been duly and validly authorized by each Guarantor and, when
executed, authenticated and delivered in accordance with the terms of the
Indenture and the Registration Rights Agreement, will be legally valid and
binding obligations of the Company, with respect to the Exchange Notes and
the Private Exchange Notes, and each Guarantor, with respect to the
respective guarantees thereof, entitled to the benefits of the Indenture and
enforceable against the Company and each Guarantor in accordance with their
-4-
terms, except (i) that the enforceability thereof may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer or other similar laws relating to or affecting creditors' rights
generally and (ii) for general principles of equity, including without
limitation, concepts of reasonableness, good faith and fair dealing and the
possible unavailability of specific performance ot injunctive relief
(regardless of whether considered in a proceeding in equity or at law).
10. The Registration Rights Agreement has been duly and validly
authorized, executed and delivered by the Company and each Guarantor (other
than the execution and delivery by New West and the New West Subsidiaries)
and is a legally valid and binding agreement of the Company and each
Guarantor (or, in the case of New West and the New West Subsidiaries, will
be, when executed and delivered thereby), enforceable against the Company
and each Guarantor in accordance with its terms, except that (i) the
enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer or other similar laws
relating to or affecting creditors' rights generally, (ii) the availability
of equitable remedies may be limited by equitable principles of general
applicability (regardless of whether considered in a proceeding in equity or
at law) and (iii) rights to indemnity may be limited by state or federal
laws relating to securities or by policies underlying such laws. The
Registration Rights Agreement conforms in all material respects to the
description thereof contained in the Final Offering Memorandum.
11. The New Credit Agreement has been duly and validly
authorized, executed and delivered by the Company and each of the Guarantors
(other than the execution and delivery by New West and the New West
Subsidiaries), will constitute a valid and legally binding agreement of the
Company and each of the Guarantors (or, in the case of New West and the New
West Subsidiaries, will be, when executed anddelivered thereby), enforceable
against the Company and each of the Guarantors in accordance with its terms,
except that the enforcement thereof may be subject to (i) bankruptcy,
insolvency, reorganization, moratorium, fraudulent transfer or other similar
laws now or hereafter in effect relating to or affecting creditors' rights
generally and (ii) general principles of equity and the discretion of the
court before which any proceeding therefor may be brought. The New Credit
Facility conforms in all material respects to the description thereof
contained in the Final Offering Memorandum.
12. The Merger Agreement has been duly and validly authorized by
the Company, NW Acquisition Corp. and New West and constitutes a valid and
legally binding agreement of the Company, NW Acquisition Corp. and New West,
enforceable against the Company, NW Acquisition Corp. and New West
inaccordance with its terms, except that the enforcement thereof may be
subject to (i) bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
generally, (ii) general principles of equity and the discretion of the court
before which any proceeding therefor may be brought and (iii) limitations,
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in whole or in part, with respect to rights to termination payments. The
Merger Agreement conforms in all material respects to the description thereof
contained in the Final Offering Memorandum.
13. None of the Company, the domestic Subsidiaries, New West or
the New West Subsidiaries is in violation of its certificate of
incorporation (or similar organizational document).
14. The execution, delivery and performance by the Company and
the Guarantors (including New West and the New West Subsidiaries upon the
consummation of the Tender Offer and the Merger, as applicable) of the
Offering Documents, the Merger Agreement and the New Credit Agreement and
the consummation of the transactions contemplated thereby and by the Final
Offering Memorandum will not (i) violate any provision of the certificate of
incorporation or the by-laws of the Company, any of the domestic Subsidiaries,
New West or any of the New West Subsidiaries, (ii) conflict with, or result
in a breach or violation of, any of the terms or provisions of, or constitute
a default under (or, with notice or passage of time or both, constitute a
default under), any "Material Contract" (defined as an indenture, mortgage,
deed of trust, license, permit, loan agreement, lease or other agreement or
instrument, in the case of Frame-n-Lens Optical, Inc. ("FNL") and its
subsidiaries, listed on Schedule B hereto, and, in the case of the Company,
the domestic Subsidiaries, New West and the New West Subsidiaries (other than
FNL and its subsidiaries), filed with the Securities and Exchange Commission
as exhibits to the respective Forms 10-K of Company and New West for their
1997 fiscal years) to which the Company, any of the domestic Subsidiaries,
New West or any of the New West Subsidiaries is a party or by which any of
them or any of their respective properties or assets is bound or is subject,
except to the extent any such conflict, breach, violation or default, singly
or in the aggregate with all other such conflicts, breaches, violations and
defaults, would not have a Material Adverse Effect, (iii) violate any order
known to such counsel or any Georgia or California (as applicable) or federal
or Delaware General Corporation Law ("Applicable") statute, rule or regulation
of any Applicable court or governmental agency or body having jurisdiction
over the Company, any of the domestic Subsidiaries, New West or any of the New
West Subsidiaries or any of their properties or assets or (iv) result in or
require the creation or imposition of any Lien, pursuant to any Material
Contract or pursuant to any Applicable statute, rule or regulation, upon or
with respect to any of the properties of the Company, any of the domestic
Subsidiaries, New West or any of the New West Subsidiaries, except pursuant
to the terms of the Indenture. No consent, approval, authorization, order,
registration or qualification of or with any Applicable court or
governmental agency or body is required for the issue and sale of the Notes
or the Guarantees to the Initial Purchasers in the manner described in the
Final Offering Memorandum and the consummation of the other transactions
contemplated by the Purchase Agreement, except such consents, approvals,
authorizations, registrations or qualifications as may be required under
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state securities or Blue Sky laws in connection with the offer and sale of
the Notes and except as have been or, by the Delivery Date, shall have been
obtained.
15. To our knowledge, there are no legal or governmental proceedings
pending to which the Company or any of the domestic Subsidiaries, New West or
any of the New West Subsidiaries is a party or of which any of their
respective properties or assets is the subject which, if determined adversely,
would singly or in the aggregate have a Material Adverse Effect or which seeks
to restrain, enjoin, prevent the consummation of or otherwise challenge the
issuance or sale of the Notes or the Guarantees to be sold pursuant to the
Purchase Agreement or the consummation of the transactions described in or
contemplated by the Offering Documents or the Final Offering Memorandum. To
our knowledge, there are no legal or governmental proceedings involving or
affecting the Company, the Subsidiaries, New West or any of the New West
Subsidiaries or any of their properties or assets that would be required to
be described in a prospectus on Form S-1 pursuant to the Securities Act that
are not described in the Final Offering Memorandum, nor are there any
material contracts or other documents that would be required to be described
in a prospectus on Form S-1 pursuant to the Securities Act that are not
described in the Final Offering Memorandum.
16. The statements set forth under the headings "Risk Factors,"
"Business-Relationship with Host Companies," "Business-Government
Regulation," "Business-Trade Names and Trademarks," "Business-Properties,"
"Business-Environmental Matters," "Business-Legal Proceedings," "The New
West Acquisition," "Description of New Credit Facility" and "Description of
the Notes" in the Final Offering Memorandum, insofar as such statements
constitute a summary of legal matters, documents, proceedings or conclusions
of law referred to therein, fairly present in all material respects such
legal matters, documents, proceedings and conclusions.
17. Assuming that the proceeds of the Offering will be applied as
described in the Final Offering Memorandum under the caption "Use of
Proceeds," consummation of the Offering, the Tender Offer, the Merger and
the other transactions contemplated by the Offering Documents and the Final
Offering Memorandum, will not violate Regulation T, U or X of the Board of
Governors of the Federal Reserve System.
18. Neither the Company nor any of the Subsidiaries is, or will
be after the consummation of Offering, the Tender Offer, the Merger and the
other transactions contemplated by the Offering Documents and the Final
Offering Memorandum, an "investment company" or an entity "controlled" by an
"investment company," as such terms are defined in the Investment Company
Act.
19. Assuming (i) the accuracy of and compliance with the
representations, warranties and agreements of the Initial Purchasers in
Section 4 of the Purchase Agreement, (ii) the accuracy of and compliance
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with the representations, warranties and agreements of the Company set forth
in the Purchase Agreement and (iii) the offer, sale and delivery of the
Notes and the Guarantees are made as contemplated by the Purchase Agreement
and the Final Offering Memorandum, neither registration of the Notes or the
Guarantees under the Securities Act nor qualification of the Indenture under
the TIA is required in connection with the offer, sale and delivery of the
Notes and the Guarantees to the Initial Purchasers.
Such counsel shall also state that such counsel has participated
in conferences with officers and other representatives of the Company,
representatives of the Initial Purchasers and counsel for the Initial
Purchasers and representatives of the independent public accountants of the
Company at which the contents of each Memorandum and related matters were
discussed, and that, although such counsel has not independently verified
the accuracy, completeness or fairness of the statements contained therein,
nothing has come to the attention of such counsel which would lead such
counsel to believe that the Final Offering Memorandum, as of its date or as
of the Delivery Date, contained or contains an untrue statement of a
material fact or omitted or omits to state a material fact necessary to make
the statements therein, in the light of the circumstances under which they
were made, not misleading (it being understood that such counsel need not
make any comment with respect to the financial statements and the notes
thereto and the other financial and statistical information or data included
in the Final Offering Memorandum).
