TW ACQUISITION CORPORATION
9 7/8% Senior Discount Notes
PURCHASE AGREEMENT
February 13, 1998
BT ALEX. XXXXX INCORPORATED
SALOMON BROTHERS INC
c/o BT Alex. Xxxxx Incorporated
Bankers Trust Plaza
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
TW Acquisition Corporation, a Delaware corporation (the
"Company"), hereby confirms its agreement with you (the "Initial Purchasers"),
as set forth below.
1. The Securities. Subject to the terms and conditions herein
contained, the Company proposes to issue and sell to the Initial Purchasers
$242,500,000 aggregate principal amount at maturity of its Senior Discount
Notes, Series A (the "Notes"). The Notes are to be issued under an indenture
(the "Indenture") to be dated as of February 20, 1998 by and between the Company
and United States Trust Company of New York, as Trustee (the "Trustee").
The Notes will be offered and sold to the Initial Purchasers
without being registered under the Securities Act of 1933, as amended (the
"Act"), in reliance on exemptions therefrom.
In connection with the sale of the Notes, the Company has
prepared a preliminary offering memorandum dated January 27, 1998 (the
"Preliminary Memorandum") and a final offering memorandum dated February 13,
1998 (the "Final Memorandum"; the Preliminary Memorandum and the Final
Memorandum each herein being referred to as a "Memorandum") setting forth or
including a description of the terms of the Notes, the terms of the offering of
the Notes, a description of the Company and any material developments relating
to the Company occurring after
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the date of the most recent historical financial statements included therein.
The Initial Purchasers and their direct and indirect
transferees of the Notes will be entitled to the benefits of the Registration
Rights Agreement, substantially in the form attached hereto as Exhibit A (the
"Registration Rights Agreement"), pursuant to which the Company has agreed,
among other things, to file a registration statement (the "Registration
Statement") with the Securities and Exchange Commission (the "Commission")
registering the Notes or the Exchange Notes (as defined in the Registration
Rights Agreement) under the Act.
The Notes are being issued in connection with the consummation
of the transactions contemplated in the Stock Purchase Agreement, dated as of
December 18, 1997 (the "Stock Purchase Agreement") among Tidewater, Inc.
("Tidewater") and the Company, pursuant to which the Company will acquire 100%
of the voting securities of Tidewater Compression Service, Inc. from Tidewater
(the "Acquisition") for a purchase price of $360 million (the "Purchase Price").
The Company will fund the Purchase Price with (i) the gross proceeds of the
Notes offered hereby; (ii) an aggregate equity contribution of $105 million (the
"Equity Contribution") from Universal Compression Holdings, Inc. ("Holdings"),
the Company's parent, derived from an $81 million cash contribution from Xxxxxx
Xxxxxx Partners III, L.P. ("CHP") (which organized both the Company and Holdings
and is the controlling stockholder of Holdings) and other parties to Holdings
(the "Cash Contribution") and $24 million net proceeds from the issuance of the
Holdings senior discount notes due 2009 ("Holdings Notes"); and (iii) a Term
Loan Credit Facility of $75 million and a Revolving Credit Facility of $85
million ($38 million of which will be drawn at the closing of the Acquisition),
each with Bankers Trust Company, as agent, and other lending institutions (the
"Credit Agreement"). Immediately following the issuance of the Notes and the
completion of the Acquisition, the Company will be merged (the "Merger")
pursuant to a Merger Agreement (the "Merger Agreement") with and into Tidewater
Compression Service, Inc., which will change its name to Universal Compression,
Inc. The Stock Purchase Agreement, the Credit Agreement and the Merger Agreement
are collectively referred to herein as the "Transaction Documents". All
references in this Agreement to the "Company" mean Universal Compression, Inc.
2. Representations and Warranties. The Company represents and
warrants to and agrees with each of the Initial Purchasers that:
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(a) Neither the Preliminary Memorandum as of the date thereof
nor the Final Memorandum nor any amendment or supplement thereto as of the date
thereof and at all times subsequent thereto up to the Closing Date (as defined
in Section 3 below) contained or contains any 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, except that the representations and warranties set forth
in this Section 2(a) do not apply to statements or omissions made in reliance
upon and in conformity with information relating to either of the Initial
Purchasers furnished to the Company in writing by the Initial Purchasers
expressly for use in the Preliminary Memorandum, the Final Memorandum or any
amendment or supplement thereto.
(b) As of the Closing Date, the Company will have the
authorized, issued and outstanding capitalization set forth in the Final
Memorandum; all of the outstanding shares of capital stock of the Company have
been, and as of the Closing Date will be, duly authorized and validly issued,
are fully paid and nonassessable and were not issued in violation of any
preemptive or similar rights; except as set forth in the Final Memorandum, all
of the outstanding shares of capital stock of the Company will be free and clear
of all liens, encumbrances (other than as may be imposed by the Credit
Agreement), equities and claims or restrictions on transferability (other than
those imposed by the Act and the securities or "Blue Sky" laws of certain
jurisdictions) or voting; except as set forth in the Final Memorandum, there are
no (i) options, warrants or other rights to purchase, (ii) agreements or other
obligations to issue or (iii) other rights to convert any obligation into, or
exchange any securities for, shares of capital stock of or ownership interests
in the Company outstanding. Except as disclosed in the Final Memorandum, the
Company does not own, directly or indirectly, any shares of capital stock or any
other equity or long-term debt securities or have any equity interest in any
firm, partnership, joint venture or other entity.
(c) The Company is duly incorporated, validly existing and in
good standing under the laws of its jurisdiction of incorporation and has all
requisite corporate power and authority to own its properties and conduct its
business as now conducted and as described in the Final Memorandum; the Company
is duly qualified to do business as a foreign corporation in good standing in
all other jurisdictions where the ownership or leasing of its properties or the
conduct of its business requires such qualification, except where the failure to
be so
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qualified would not, individually or in the aggregate, have a material adverse
effect on the management, business, condition (financial or otherwise),
prospects or results of operations of the Company, taken as a whole (any such
event, a "Material Adverse Effect").
(d) The Company has all requisite corporate power and
authority to execute, deliver and perform each of its obligations under the
Notes, the Exchange Notes and the Private Exchange Notes (as defined in the
Registration Rights Agreement). The Notes, when issued, will be in the form
contemplated by the Indenture. The Notes, the Exchange Notes and the Private
Exchange Notes have each been duly and validly authorized by the Company and,
when executed by the Company and authenticated by the Trustee in accordance with
the provisions of the Indenture and, in the case of the Notes, when delivered to
and paid for by the Initial Purchasers in accordance with the terms of this
Agreement, will constitute valid and legally binding obligations of the Company,
entitled to the benefits of the Indenture, and enforceable against the Company
in accordance with their 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.
(e) The Company has all requisite corporate power and
authority to execute, deliver and perform its obligations under the Indenture.
The Indenture meets the requirements for qualification under the Trust Indenture
Act of 1939, as amended (the "TIA"). The Indenture has been duly and validly
authorized by the Company and, when executed and delivered by the Company
(assuming the due authorization, execution and delivery by the Trustee), will
constitute a valid and legally binding agreement of the Company, enforceable
against the Company 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.
(f) The Company has all requisite corporate power and
authority to execute, deliver and perform its obligations under the Registration
Rights Agreement. The Registration Rights Agreement has been duly and validly
authorized by the Company and, when executed and delivered by the Company, will
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constitute a valid and legally binding agreement of the Company enforceable
against the Company in accordance with its terms, except that (A) 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 and (B) any rights to indemnity or contribution thereunder may be
limited by federal and state securities laws and public policy considerations.
(g) The Company has all requisite corporate power and
authority to execute, deliver and perform its obligations under this Agreement,
each of the Transaction Documents and to consummate the transactions
contemplated hereby and thereby. This Agreement, each of the Transaction
Documents and the consummation by the Company of the transactions contemplated
hereby and thereby have been duly and validly authorized by the Company. This
Agreement has been duly executed and delivered by the Company.
(h) No consent, approval, authorization or order of any court
or governmental agency or body, or third party is required for the issuance and
sale by the Company of the Notes to the Initial Purchasers or the consummation
by the Company of each of the Transaction Documents and the other transactions
contemplated hereby and thereby, except such as have been obtained and such as
may be required under state securities or "Blue Sky" laws in connection with the
purchase and resale of the Notes by the Initial Purchasers. The Company is not
(i) in violation of its certificate of incorporation or bylaws (or similar
organizational document), (ii) in breach or violation of any statute, judgment,
decree, order, rule or regulation applicable to it or any of its 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 it is a party or to which it or any of its
properties or assets is subject (collectively, "Contracts"), except for any such
breach, default, violation or event which would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
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(i) The execution, delivery and performance by the Company of
this Agreement, the Indenture, the Registration Rights Agreement and each of the
Transaction Documents and the consummation by the Company of the transactions
contemplated hereby and thereby (including, without limitation, the issuance and
sale of the Notes to the Initial Purchasers) will not conflict with or
constitute or result in a breach of or a default under (or an event which with
notice or passage of time or both would constitute a default under) or violation
of any of (i) the terms or provisions of any Contract, except for any such
conflict, breach, violation, default or event which would not, individually or
in the aggregate, have a Material Adverse Effect, (ii) the certificate of
incorporation or bylaws (or similar organizational document) of the Company, or
(iii) (assuming compliance with all applicable state securities or "Blue Sky"
laws and assuming the accuracy of the representations and warranties of the
Initial Purchasers in Section 8 hereof) any statute, judgment, decree, order,
rule or regulation applicable to the Company or any of its properties or assets,
except for any such conflict, breach or violation which would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(j) The audited financial statements of the Company included
in the Final Memorandum present fairly in all material respects the financial
position, results of operations and cash flows of the Company at the respective
dates and for the respective periods to which they relate and have been prepared
in accordance with generally accepted accounting principles applied on a
consistent basis, except as otherwise stated therein. The summary and selected
financial and statistical data in the Final 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
therein, except as otherwise stated therein. KPMG Peat Marwick LLP and Deloitte
& Touche (the "Independent Accountants") are independent public accounting firms
within the meaning of the Act and the rules and regulations promulgated
thereunder.
(k) The pro forma financial statements (including the notes
thereto) and the other pro forma financial information included in the Final
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 (the "Exchange Act"), (ii) have been prepared in all material
respects in accordance with the Commission's rules and guidelines with respect
to pro forma financial state-
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ments, and (iii) have been properly computed on the bases described therein; the
assumptions used in the preparation of the pro forma financial data and other
pro forma financial information included in the Final Memorandum are reasonable
and the adjustments used therein are appropriate in all material respects to
give effect to the transactions or circumstances referred to therein.
(l) There is not pending or, to the knowledge of the Company,
threatened any action, suit, proceeding, inquiry or investigation to which the
Company is a party, or to which the property or assets of the Company are
subject, before or brought by any court, arbitrator or governmental agency or
body which, if determined adversely to the Company, would reasonably be expected
to have individually 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 to be sold hereunder or the
consummation of the other transactions described in the Final Memorandum.
(m) The Company possesses all licenses, permits, certificates,
consents, orders, approvals and other authorizations from, and has made all
declarations and filings with, all federal, state, local and other governmental
authorities, all self-regulatory organizations and all courts and other
tribunals, presently required or necessary to own or lease, as the case may be,
and to operate its properties and to carry on its businesses as now or proposed
to be conducted as set forth in the Final Memorandum ("Permits"), except where
the failure to obtain such Permits would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect; the Company has
fulfilled and performed all of its obligations with respect to such Permits and
no event has occurred which allows, or after notice or lapse of time would
allow, revocation or termination thereof or results in any other material
impairment of the rights of the holder of any such Permit; the Company has not
received any notice of any proceeding relating to revocation or modification of
any such Permit, except as described in the Final Memorandum and except where
such revocation or modification would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
(n) Since the date of the most recent financial statements
appearing in the Final Memorandum, except as described therein, (i) the Company
has not 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,
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obligations, transactions or contracts would, individually or in the aggregate,
be material to the management, business, condition (financial or otherwise), or
results of operations of the Company, (ii) the Company has not purchased any of
its outstanding capital stock or declared, paid or otherwise made any dividend
or distribution of any kind on its capital stock and (iii) there shall not have
been any change in the capital stock or long-term indebtedness of the Company.
(o) The Company has filed all necessary federal, state and
foreign income and franchise tax returns, except where the failure to so file
such returns would not, individually or in the aggregate, have a Material
Adverse Effect, and has, except for delinquent sales and use taxes (and a late
payment penalty related thereto) owed to the State of Louisiana, paid all taxes
shown due with respect to the periods covered by such returns; and other than
tax deficiencies which the Company is contesting in good faith and for which the
Company has provided adequate reserves, there is no tax deficiency that has been
asserted against the Company that would have, individually or in the aggregate,
a Material Adverse Effect.
(p) The statistical and market-related data included in the
Final Memorandum are based on or derived from sources which the Company believes
to be reliable and accurate.
(q) The Company or any agent acting on its behalf has not
taken or will not take any action that might cause this Agreement or the sale of
the Notes to violate Regulation G, 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 Closing Date.
(r) The Company has good and marketable title to all real
property or good title to all personal property described in the Final
Memorandum as being owned by it and good and marketable title to a leasehold
estate in the real and personal property described in the Final Memorandum as
being leased by it free and clear of all liens, charges, encumbrances or
restrictions, except as described in the Final Memorandum or to the extent the
failure to have such title or the existence of such liens, charges, encumbrances
or restrictions would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. All leases, contracts and agreements
to which the Company is a party or by which it is bound are valid and
enforceable against the Company, and are valid and enforceable against the other
party or parties thereto and are in full force and effect with only such
excep-
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tions as would not, individually or in the aggregate, have a Material Adverse
Effect. The Company owns or possesses adequate licenses or other rights to use
all patents, trademarks, service marks, trade names, copyrights and know-how
necessary to conduct the businesses now or proposed to be operated by it as
described in the Final Memorandum, and the Company has not received any notice
of infringement of or conflict with (or knows of any such infringement of or
conflict with) asserted rights of others with respect to any patents,
trademarks, service marks, trade names, copyrights or know-how which, if such
assertion of infringement or conflict were sustained, would reasonably be
expected to have a Material Adverse Effect.
(s) There are no legal or governmental proceedings involving
or affecting the Company or any of its properties or assets which would be
required to be described in a prospectus pursuant to the Act that are not
described in the Final Memorandum, nor are there any material contracts or other
documents which would be required to be described in a prospectus pursuant to
the Act that are not described in the Final Memorandum.
(t) Except as would not, individually or in the aggregate and
except as disclosed in the Final Memorandum reasonably be expected to have a
Material Adverse Effect (A) the Company is in compliance with and not subject to
liability under applicable Environmental Laws (as defined below), (B) the
Company 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, threatened against the Company 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, (E) the Company has not 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 is (i) listed or proposed for listing on the National Priorities
List under CERCLA or (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.
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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, ground water, 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 above ground storage tanks and related piping, and emissions, discharges,
releases or threatened releases therefrom.
(u) There is no organized strike, labor dispute, slowdown or
work stoppage with the employees of the Company which is pending or, to the
knowledge of the Company, threatened.
(v) As of the Closing Date, the Company will have in place
insurance in such amounts and covering such risks as is adequate for the conduct
of its business and the value of its properties.
(w) The Company (i) makes and keeps books and records which,
in reasonable detail, accurately and fairly reflect the transactions and
disposition of assets of the Company and (ii) maintains internal accounting
controls which provide reasonable assurance that (A) transactions are executed
in accordance with management's general or specific authorization, (B)
transactions are recorded as necessary to permit preparation of its financial
statements and to maintain accountability for its assets, (C) access to its
assets is permitted only in accordance with management's general or specific
authorization and (D) the reported accountability for its assets is compared
with existing assets at reasonable intervals.
(x) The Company will not be an "investment company" or
"promoter" or "principal underwriter" for an "investment company," as such terms
are defined in the Investment Company Act of 1940, as amended, and the rules and
regulations thereunder.
(y) The Notes, the Indenture, the Registration Rights
Agreement and each of the Transaction Documents will
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conform in all material respects to the descriptions thereof in the Final
Memorandum.
(z) No holder of securities of the Company will be entitled to
have such securities registered under the registration statements required to be
filed by the Company pursuant to the Registration Rights Agreement other than as
expressly permitted thereby.
(aa) Immediately after the consummation of the transactions
contemplated by this Agreement, the fair value and present fair saleable value
of the assets of the Company will exceed the sum of its stated liabilities and
identified contingent liabilities; the Company is not nor will the Company be,
after giving effect to the execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby, (a) left with
unreasonably small capital with which to carry on its business as it is proposed
to be conducted, (b) unable to pay its debts (contingent or otherwise) as they
mature or (c) otherwise insolvent.
(bb) The Company or any of its Affiliates (as defined in Rule
501(b) of Regulation D under the Act) has not 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 Act) which is or could be
integrated with the sale of the Notes in a manner that would require the
registration under the Act of the Notes or (ii) engaged in any form of general
solicitation or general advertising (as those terms are used in Regulation D
under the Act) in connection with the offering of the Notes or in any manner
involving a public offering within the meaning of Section 4(2) of the Act.
Assuming the accuracy of the representations and warranties of the Initial
Purchasers in Section 8 hereof, 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 any of the Notes under the Act or to
qualify the Indenture under the TIA.
(cc) No securities of the Company are of the same class
(within the meaning of Rule 144A under the Act) as the Notes and listed on a
national securities exchange registered under Section 6 of the Exchange Act, or
quoted in a U.S. automated inter-dealer quotation system.
(dd) The Company has not taken, nor will it take, directly or
indirectly, any action designed to, or that might
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be reasonably expected to, cause or result in stabilization or manipulation of
the price of the Notes.
(ee) The Company or any of its Affiliates or any person acting
on its or their behalf (other than the Initial Purchasers) has not engaged in
any directed selling efforts (as that term is defined in Regulation S under the
Act ("Regulation S")) with respect to the Notes; the Company and its Affiliates
and any person acting on its or their behalf (other than the Initial Purchasers)
have complied with the offering restrictions requirement of Regulation S.
(ff) The Company has delivered to counsel to the Initial
Purchasers a true and correct copy of each of the Transaction Documents that has
been executed and delivered prior to the date of this Agreement and each other
Transaction Document in the form substantially as it will be executed and
delivered on or prior to the Closing Date, together with all related agreements
and all schedules and exhibits thereto, and there shall have been no amendments,
alterations, modifications or waivers of any of the provisions of any of the
Transaction Documents since their respective dates of execution or from the form
in which it has been delivered to the Initial Purchasers, other than any such
amendments, alterations, modifications and waivers as to which the Initial
Purchasers have been advised in writing and which would not be required to be
disclosed in the Preliminary Memorandum or the Final Memorandum, as the case may
be; and to the knowledge of the Company there exists no event or condition which
would constitute a default or an event of default under any of the Transaction
Documents which would reasonably be expected to result in a Material Adverse
Effect or materially adversely affect the ability to consummate the transactions
contemplated by the Transaction Documents or the Final Memorandum.
Any certificate signed by any officer of the Company and
delivered to any Initial Purchaser or to counsel for the Initial Purchasers
shall be deemed a joint and several representation and warranty by the Company
to each Initial Purchaser as to the matters covered thereby.
3. Purchase, Sale and Delivery of the Notes. On the basis of
the representations, warranties, agreements and covenants herein contained and
subject to the terms and conditions herein set forth, the Company agrees to
issue and sell to the Initial Purchasers, and the Initial Purchasers, acting
severally and not jointly, agree to purchase the Notes in the respective amounts
set forth on Schedule 1, hereto from the Com-
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pany at 58.84% of their principal amount at maturity of the Senior Discount
Notes. One or more certificates in definitive form for the Notes that the
Initial Purchasers have agreed to purchase hereunder, and in such denomination
or denominations and registered in such name or names as the Initial Purchasers
request upon notice to the Company at least 36 hours prior to the Closing Date,
shall be delivered by or on behalf of the Company to the Initial Purchasers,
against payment by or on behalf of the Initial Purchasers of the purchase price
therefor by wire transfer (same day funds), to such account or accounts as the
Company shall specify prior to the Closing Date, or by such means as the parties
hereto shall agree prior to the Closing Date. Such delivery of and payment for
the Notes shall be made at the offices of Xxxxxxx Xxxx & Xxxxx LLP, 000 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx at 10:00 A.M., New York time, on February 20, 1998,
or at such other place, time or date as the Initial Purchasers, on the one hand,
and the Company, on the other hand, may agree upon, such time and date of
delivery against payment being herein referred to as the "Closing Date." The
Company will make such certificate or certificates for the Notes available for
checking and packaging by the Initial Purchasers at the offices of BT Alex.
Xxxxx Incorporated in New York, New York, or at such other place as BT Alex.
Xxxxx Incorporated may designate, at least 24 hours prior to the Closing Date.
4. Offering by the Initial Purchasers. The Initial Purchasers
propose to make an offering of the Notes at the price and upon the terms set
forth in the Final Memorandum, as soon as practicable after this Agreement is
entered into and as in the judgment of the Initial Purchasers is advisable.
5. Covenants of the Company. The Company covenants and agrees
with each of the Initial Purchasers that:
(a) The Company will not amend or supplement the Final
Memorandum or any amendment or supplement thereto of which the Initial
Purchasers shall not previously have been advised and furnished a copy for a
reasonable period of time prior to the proposed amendment or supplement and as
to which the Initial Purchasers shall reasonably object to in writing. The
Company will promptly, upon the reasonable request of the Initial Purchasers or
counsel for the Initial Purchasers, make any amendments or supplements to the
Preliminary Memorandum or the Final Memorandum that may be necessary or
advisable in connection with the resale of the Notes by the Initial Purchasers.
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(b) The Company will cooperate with the Initial Purchasers in
arranging for the qualification of the Notes for offering and sale under the
securities or "Blue Sky" laws of which jurisdictions as the Initial Purchasers
may designate and will continue such qualifications in effect for as long as may
be necessary to complete the resale of the Notes; provided, however, that in
connection therewith, the Company shall not be required to qualify as a foreign
corporation or to execute a general consent to service of process in any
jurisdiction or subject itself to taxation in excess of a nominal dollar amount
in any such jurisdiction where it is not then so subject.
(c) If, at any time prior to the completion of the
distribution by the Initial Purchasers of the Notes or the Private Exchange
Notes, any event occurs or information becomes known as a result of which the
Final 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 Memorandum to comply with applicable law, the
Company will promptly notify the Initial Purchasers thereof and will prepare, at
the expense of the Company, an amendment or supplement to the Final Memorandum
that corrects such statement or omission or effects such compliance.
(d) The Company will, without charge, provide to the Initial
Purchasers and to counsel for the Initial Purchasers as many copies of the
Preliminary Memorandum and the Final Memorandum or any amendment or supplement
thereto as the Initial Purchasers may reasonably request.
(e) The Company will apply the net proceeds from the sale of
the Notes as set forth under "Use of Proceeds" in the Final Memorandum.
(f) For so long as any of the Notes remain outstanding, the
Company will furnish to the Initial Purchasers copies of all reports and other
communications (financial or otherwise) furnished by the Company to the Trustee
or to the holders of the Notes and, as soon as available, copies of any reports
or financial statements furnished to or filed by the Company with the Commission
or any national securities exchange on which any class of securities of the
Company may be listed.
(g) Prior to the Closing Date, the Company will furnish to the
Initial Purchasers, as soon as they have been pre-
-15-
pared, a copy of any unaudited interim financial statements of the Company for
any period subsequent to the period covered by the most recent financial
statements appearing in the Final Memorandum.
(h) None of the Company or any of its Affiliates will sell,
offer for sale or solicit offers to buy or otherwise negotiate in respect of any
"security" (as defined in the Act) which could be integrated with the sale of
the Notes in a manner which would require the registration under the Act of the
Notes.
(i) The Company will not engage in any form of general
solicitation or general advertising (as those terms are used in Regulation D
under the Act) in connection with the offering of the Notes or in any manner
involving a public offering within the meaning of Section 4(2) of the Act.
(j) For so long as any of the Notes remain outstanding, the
Company will make available at its expense, upon request, to any holder of such
Notes and any prospective purchasers thereof the information specified in Rule
144A(d)(4) under the Act, unless the Company is then subject to Section 13 or
15(d) of the Exchange Act.
(k) The Company will use its best efforts to (i) permit the
Notes to be designated PORTAL securities in accordance with the rules and
regulations adopted by the NASD relating to trading in the Private Offerings,
Resales and Trading through Automated Linkages market (the "Portal Market") and
(ii) permit the Notes to be eligible for clearance and settlement through The
Depository Trust Company.
(l) In connection with Notes offered and sold in an off shore
transaction (as defined in Regulation S) the Company will not register any
transfer of such Notes not made in accordance with the provisions of Regulation
S and will not, except in accordance with the provisions of Regulation S, if
applicable, issue any such Notes in the form of definitive securities.
6. Expenses. The Company agrees to pay all costs and expenses
incident to the performance of its obligations under this Agreement, whether or
not the transactions contemplated herein are consummated or this Agreement is
terminated pursuant to Section 11 hereof, including all costs and expenses
incident to (i) the printing, word processing or other production of documents
with respect to the transactions contemplated hereby, including any costs of
printing the Preliminary Memo-
-16-
randum and the Final Memorandum and any amendment or supplement thereto, and any
"Blue Sky" memoranda, (ii) all arrangements relating to the delivery to the
Initial Purchasers of copies of the foregoing documents, (iii) the fees and
disbursements of the counsel, the accountants and any other experts or advisors
retained by the Company, (iv) preparation (including printing), issuance and
delivery to the Initial Purchasers of the Notes, (v) the qualification of the
Notes under state securities and "Blue Sky" laws, including filing fees and fees
and disbursements of counsel for the Initial Purchasers relating thereto, (vi)
expenses in connection with any meetings with prospective investors in the
Notes, (vii) fees and expenses of the Trustee including reasonable fees and
expenses of counsel, (viii) all expenses and listing fees incurred in connection
with the application for quotation of the Notes on the Portal Market and (ix)
any fees charged by investment rating agencies for the rating of the Notes. If
the sale of the Notes provided for herein is not consummated because any
condition to the obligations of the Initial Purchasers set forth in Section 7
hereof is not satisfied, because this Agreement is terminated or because of any
failure, refusal or inability on the part of the Company to perform all
obligations and satisfy all conditions on their part to be performed or
satisfied hereunder (other than solely by reason of a default by the Initial
Purchasers of their obligations hereunder or by reason of Section 11(a)) the
Company agrees to promptly reimburse the Initial Purchasers upon demand for all
out-of-pocket expenses (including reasonable fees, disbursements and charges of
Xxxxxx Xxxxxx & Xxxxxxx, counsel for the Initial Purchasers) that shall have
been incurred by the Initial Purchasers in connection with the proposed purchase
and sale of the Notes.
7. Conditions of the Initial Purchasers' Obligations. The
obligation of the Initial Purchasers to purchase and pay for the Notes shall, in
their sole discretion, be subject to the satisfaction or waiver of the following
conditions on or prior to the Closing Date:
(a) On the Closing Date, the Initial Purchasers shall have
received the opinion, dated as of the Closing Date and addressed to the Initial
Purchasers, of Xxxxxxx Xxxx & Xxxxx LLP, counsel for the Company, in form and
substance satisfactory to counsel for the Initial Purchasers, to the effect
that:
(i) The Company is duly incorporated, validly existing and
in good standing under the laws of its jurisdiction of incorporation
and has all requisite corporate
-17-
power and authority to own its properties and to conduct its business
as described in the Final Memorandum. The Company is duly qualified to
do business as a foreign corporation in good standing in all other
domestic jurisdictions where it conducts operations as disclosed in the
Final Memorandum except where the failure to be so qualified would not,
individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
(ii) The Company has the authorized, issued and outstanding
capitalization set forth in the Final Memorandum; all of the
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.
(iii) Except as set forth in or contemplated by the Final
Memorandum to the knowledge of such counsel (A) no options, warrants or
other rights to purchase from the Company shares of capital stock or
ownership interests in the Company are outstanding, (B) no agreements
or other obligations to issue, or other rights to convert, any
obligation into, or exchange any securities for, shares of capital
stock or ownership interests in the Company are outstanding and (C) no
holder of securities of the Company is entitled to have such securities
registered under a registration statement filed by the Company pursuant
to the Registration Rights Agreement.
(iv) The Company has all requisite corporate power and
authority to execute, deliver and perform each of its obligations under
the Indenture, the Notes, the Exchange Notes and the Private Exchange
Notes; the Indenture meets the requirements for qualification under the
TIA in all material respects; the Indenture has been duly and validly
authorized by the Company and, when duly executed and delivered by the
Company (assuming the due authorization, execution and delivery thereof
by the Trustee), will constitute the valid and legally binding
agreement of the Company, enforceable against the Company 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.
-18-
(v) The Notes are in the form contemplated by the Indenture.
The Notes have each been duly and validly authorized by the Company
and, when duly executed and delivered by the Company and paid for by
the Initial Purchasers in accordance with the terms of this Agreement
(assuming the due authorization, execution and delivery of the
Indenture by the Trustee and due authentication and delivery of the
Notes by the Trustee in accordance with the Indenture), will constitute
the valid and legally binding obligations of the Company, entitled to
the benefits of the Indenture, and enforceable against the Company in
accordance with their 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.
(vi) The Exchange Notes and the Private Exchange Notes have
been duly and validly authorized by the Company, and when the Exchange
Notes and the Private Exchange Notes have been duly executed and
delivered by the Company in accordance with the terms of the
Registration Rights Agreement and the Indenture (assuming the due
authorization, execution and delivery of the Indenture by the Trustee
and due authentication and delivery of the Exchange Notes and the
Private Exchange Notes by the Trustee in accordance with the
Indenture), will constitute the valid and legally binding obligations
of the Company, entitled to the benefits of the Indenture, and
enforceable against the Company in accordance with their 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.
(vii) The Company has all requisite corporate power and
authority to execute, deliver and perform its obligations under the
Registration Rights Agreement; the Registration Rights Agreement has
been duly and validly authorized by the Company and, when duly executed
and delivered by the Company (assuming due authorization, execution and
delivery thereof by the Initial Purchasers), will constitute the valid
and legally binding agreement of the Company, enforceable against the
Company in accordance with
-19-
its terms, except that (A) 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, (B) any rights to
indemnity or contribution thereunder may be limited by federal and
state securities laws and public policy considerations and (C) such
counsel may exclude the enforceability of liquidated damages provisions
from its opinion.
(viii) The Company has all requisite corporate power and
authority to execute, deliver and perform its obligations under this
Agreement, and to consummate the transactions contemplated hereby; this
Agreement and the consummation by the Company of the transactions
contemplated hereby have been duly and validly authorized by the
Company. This Agreement has been duly executed and delivered by the
Company.
(ix) The Company has all requisite corporate power and
authority to execute, deliver and perform its obligations under each of
the Transaction Documents; each of the Transaction Documents has been
duly and validly authorized by the Company and, when duly executed and
delivered by the Company (assuming due authorization, execution and
delivery thereof by the Initial Purchasers), will constitute the valid
and legally binding agreement of the Company, enforceable against the
Company in accordance with its terms, except that (A) 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 and (B) any rights to indemnity or contribution thereunder may
be limited by federal and state securities laws and public policy
considerations.
(x) The Indenture, the Notes, the Registration Rights
Agreement and each of the Transaction Documents conform in all material
respects to the descriptions thereof contained in the Final Memorandum.
(xi) To the knowledge of such counsel, no legal or
governmental proceedings are pending or, to the knowledge of such
counsel, threatened to which the Company is a
-20-
party or to which the property or assets of the Company are subject
which, if determined adversely to the Company, would reasonably be
expected to result, individually or in the aggregate, in a Material
Adverse Effect, or which seek to restrain, enjoin, prevent the
consummation of or otherwise challenge the issuance or sale of the
Notes to be sold hereunder or the consummation of the other
transactions described in the Final Memorandum under the caption
"Description of Company Acquisition".
(xii) The execution, delivery and performance of this
Agreement, the Indenture, the Registration Rights Agreement, each of
the Transaction Documents and the consummation of the transactions
contemplated hereby and thereby (including, without limitation, the
issuance and sale of the Notes to the Initial Purchasers) will not
conflict with or constitute or result in a breach or a default under
(or an event which with notice or passage of time or both would
constitute a default under) or violation of any of (i) the terms or
provisions of any Contract listed on a schedule reasonably acceptable
to the Initial Purchasers, except for any such conflict, breach,
violation, default or event which would not, individually or in the
aggregate, have a Material Adverse Effect, (ii) the certificate of
incorporation or bylaws of the Company or (iii) (assuming compliance
with all applicable state securities or "Blue Sky" laws and assuming
the accuracy of the representations and warranties of the Initial
Purchasers in Section 8 hereof) any statute, judgment, decree, order,
rule or regulation known to such counsel to be applicable to the
Company or any of its properties or assets, except for any such
conflict, breach or violation which would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
(xiii) No consent, approval, authorization or order of any
governmental authority is required for the issuance and sale by the
Company of the Notes to the Initial Purchasers, the consummation by the
Company of each of the Transaction Documents or of the other
transactions contemplated hereby and thereby, except such as may be
required under the Federal Securities laws or Blue Sky laws, as to
which such counsel need express no opinion, and those which have
previously been obtained.
(xiv) The Company is not, nor immediately after the sale of
the Notes to be sold hereunder and the application of the proceeds from
such sale (as described in the Final
-21-
Memorandum under the caption "Use of Proceeds") will it be, an
"investment company" as such term is defined in the Investment Company
Act of 1940, as amended.
(xv) No registration under the Act of the Notes is required
in connection with the sale of the Notes to the Initial Purchasers as
contemplated by this Agreement and the Final Memorandum or in
connection with the initial resale of the Notes by the Initial
Purchasers in accordance with Section 8 of this Agreement, and prior to
the commencement of the Exchange Offer (as defined in the Registration
Rights Agreement) or the effectiveness of the Shelf Registration
Statement (as defined in the Registration Rights Agreement), the
Indenture is not required to be qualified under the TIA, in each case
assuming (i) (A) that the purchasers who buy such Notes in the initial
resale thereof are qualified institutional buyers as defined in Rule
144A promulgated under the Act ("QIBs") or accredited investors as
defined in Rule 501(a)(1), (2), (3) or (7) promulgated under the Act
("Accredited Investors") or (B) that the offer or sale of the Notes is
made in an offshore transaction as defined in and in compliance with
Regulation S, (ii) the accuracy of the Initial Purchasers'
representations in Section 8 and those of the Company contained in this
Agreement regarding the absence of a general solicitation in connection
with the offer and sale of such Notes to the Initial Purchasers and the
initial resale thereof and (iii) the due performance by the Initial
Purchasers of the agreements set forth in Section 8 hereof.
(xvi) Neither the consummation of the transactions
contemplated by this Agreement nor the sale, issuance, execution or
delivery of the Notes will violate Regulation G, T, U or X of the Board
of Governors of the Federal Reserve System.
At the time the foregoing opinion is delivered, Xxxxxxx Xxxx &
Xxxxx LLP shall additionally state that it has participated in conferences with
officers and other representatives of the Company, representatives of the
independent public accountants for the Company, representatives of the Initial
Purchasers and counsel for the Initial Purchasers, at which conferences the
contents of the Final Memorandum and related matters were discussed, and,
although it has not independently verified and is not passing upon and assumes
no responsibility for the accuracy, completeness or fairness of the statements
contained in the Final Memorandum (except to the extent speci-
-22-
fied in subsection 7(a)(x)), no facts have come to its attention which lead it
to believe that the Final Memorandum, on the date thereof or at the Closing
Date, contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the statements
contained therein, in light of the circumstances under which they were made, not
misleading (it being understood that such firm need express no opinion with
respect to the financial statements and related notes thereto and the other
financial, statistical and accounting data included in the Final Memorandum).
The opinion and statement of Xxxxxxx Xxxx & Xxxxx LLP described in this Section
shall be rendered to the Initial Purchasers at the request of the Company and
shall so state therein. In rendering such opinion, Xxxxxxx Xxxx & Xxxxx LLP
shall have received and may rely upon such certificates and other documents and
information as it may reasonably request to pass upon such matters.
References to the Final Memorandum in this subsection (a)
shall include any amendment or supplement thereto prepared in accordance with
the provisions of this Agreement at the Closing Date.
(b) On the Closing Date, the Initial Purchasers shall have
received the opinion, in form and substance satisfactory to the Initial
Purchasers, dated as of the Closing Date and addressed to the Initial
Purchasers, of Xxxxxx Xxxxxx & Xxxxxxx, counsel for the Initial Purchasers, with
respect to certain legal matters relating to this Agreement and such other
related matters as the Initial Purchasers may reasonably require. In rendering
such opinion, Xxxxxx Xxxxxx & Xxxxxxx shall have received and may rely upon such
certificates and other documents and information as it may reasonably request to
pass upon such matters.
(c) The Initial Purchasers shall have received from each of
the Independent Accountants a comfort letter or letters dated the date hereof
and the Closing Date, in form and substance satisfactory to counsel for the
Initial Purchasers.
(d) The representations and warranties of the Company
contained in this Agreement shall be true and correct on and as of the date
hereof and on and as of the Closing Date as if made on and as of the Closing
Date; the statements of the Company's officers made pursuant to any certificate
delivered in accordance with the provisions hereof shall be true and correct in
all material respects on and as of the date made and on and as of the Closing
Date; the Company shall have performed in
-23-
all material respects all covenants and agreements and satisfied all conditions
on their part to be performed or satisfied hereunder at or prior to the Closing
Date; and, except as described in the Final Memorandum (exclusive of any
amendment or supplement thereto after the date hereof), subsequent to the date
of the most recent financial statements in such Final Memorandum, there shall
have been no event or development, and no information shall have become known,
that, individually or in the aggregate, has or would be reasonably likely to
have a Material Adverse Effect.
(e) The sale of the Notes hereunder shall not be enjoined
(temporarily or permanently) on the Closing Date.
(f) Subsequent to the date of the most recent financial
statements in the Final Memorandum (exclusive of any amendment or supplement
thereto after the date hereof), the Company shall not have sustained any loss or
interference with respect to its business or properties from fire, flood,
hurricane, accident or other calamity, whether or not covered by insurance, or
from any strike, labor dispute, slowdown or work stoppage or from any legal or
governmental proceeding, order or decree, which loss or interference,
individually or in the aggregate, has or would be reasonably likely to have a
Material Adverse Effect.
(g) The Initial Purchasers shall have received a certificate
of the Company, dated the Closing Date, signed on behalf of the Company by its
Chairman of the Board, President or any Senior Vice President and the Chief
Financial Officer, to the effect that:
(i) After giving effect to the Offering of the Notes and the
consummation of each of the Transaction Documents, the representations
and warranties of the Company contained in this Agreement are true and
correct in all material respects on and as of the date hereof and on
and as of the Closing Date, and the Company has performed in all
material respects all covenants and agreements and satisfied all
conditions on its part to be performed or satisfied hereunder at or
prior to the Closing Date;
(ii) At the Closing Date, since the date hereof or since the
date of the most recent financial statements in the Final Memorandum
(exclusive of any amendment or supplement thereto after the date
hereof), no event or development has occurred, and no information has
become known,
-24-
that, individually or in the aggregate, has or would be reasonably
likely to have a Material Adverse Effect; and
(iii) The sale of the Notes hereunder has not been enjoined
(temporarily or permanently).
(h) On the Closing Date, the Initial Purchasers shall have
received the Registration Rights Agreement executed by the Company.
(i) On the Closing Date, all material conditions (other than
the payment of the purchase price) to the consummation of the Stock Purchase
Agreement shall have been satisfied and such Stock Purchase Agreement shall be
in full force and effect. Since the date of this Agreement, except as previously
disclosed to the Initial Purchasers and reasonably acceptable to them, there
have been no amendments, modifications, restatements or waivers to the Stock
Purchase Agreement that, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect, or materially adversely affect the
holders of the Notes, or which would be required to be disclosed in the Final
Memorandum and are not so disclosed.
(j) On the Closing Date, all material conditions to the
consummation of the Merger Agreement shall have been satisfied; the Certificate
of Merger merging the Company with and into Tidewater Compression Service, Inc.
shall have been pre-cleared under the laws of the State of Delaware and the
State of Texas, and the Certificate of Name Change changing Tidewater
Compression Services, Inc.'s name to Universal Compression, Inc. shall have been
pre-cleared under the laws of the State of Texas. The Merger Agreement conforms
in all material respects to the description of the Merger set forth in the Final
Memorandum.
(k) On the Closing Date, all material conditions to the
consummation of the Credit Agreement and the making of the initial Loans (as
defined in the Credit Agreement) shall have been satisfied. The Credit Agreement
conforms in all material respects to the description thereof in the Final
Memorandum.
(l) On the Closing Date, all material conditions to the
consummation of the Equity Contribution shall have been satisfied and the Cash
Contribution shall have been consummated prior to the consummation of the
offering of Notes. The Equity Contribution conforms in all material respects to
the description thereof in the Final Memorandum.
-25-
(m) The Initial Purchasers shall have received a true, correct
and executed copy of the (i) Credit Agreement; (ii) Stock Purchase Agreement;
(iii) Merger Agreement; and (iv) Assumption Agreement, a form of which is
attached hereto as Exhibit A.
On or before the Closing Date, the Initial Purchasers and
counsel for the Initial Purchasers shall have received such further documents,
opinions, certificates, letters and schedules or instruments relating to the
business, corporate, legal and financial affairs of the Company as they shall
have heretofore reasonably requested from the Company.
All such documents, opinions, certificates, letters, schedules
or instruments delivered pursuant to this Agreement will comply with the
provisions hereof only if they are reasonably satisfactory in all material
respects to the Initial Purchasers and counsel for the Initial Purchasers. The
Company shall furnish to the Initial Purchasers such conformed copies of such
documents, opinions, certificates, letters, schedules and instruments in such
quantities as the Initial Purchasers shall reasonably request.
8. Offering of Notes; Restrictions on Transfer.
(a) Each of the Initial Purchasers represents and warrants (as
to itself only) that it is a QIB. Each of the Initial Purchasers agrees with the
Company (as to itself only) that (i) it has not and will not solicit offers for,
or offer or sell, the Notes by any form of general solicitation or general
advertising (as those terms are used in Regulation D under the Act) or in any
manner involving a public offering within the meaning of Section 4(2) of the
Act; and (ii) it has and will solicit offers for the Notes only from, and will
offer the Notes only to (A) in the case of offers inside the United States,
persons whom the Initial Purchasers reasonably believe to be QIBs or, if any
such person is buying for one or more institutional accounts for which such
person is acting as fiduciary or agent, only when such person has represented to
the Initial Purchasers that each such account is a QIB, to whom notice has been
given that such sale or delivery is being made in reliance on Rule 144A, and, in
each case, in transactions under Rule 144A and (B) in the case of offers outside
the United States, to persons other than U.S. persons ("foreign purchasers,"
which term shall include dealers or other professional fiduciaries in the United
States acting on a discretionary basis for foreign beneficial owners (other than
an estate or trust)); provided, however, that, in the case of this clause
-26-
(B), in purchasing such Notes such persons are deemed to have represented and
agreed as provided under the caption "Transfer Restrictions" contained in the
Final Memorandum (or, if the Final Memorandum is not in existence, in the most
recent Memorandum).
(b) Each of the Initial Purchasers represents and warrants (as
to itself only) with respect to offers and sales outside the United States that
(i) it has and will comply with all applicable laws and regulations in each
jurisdiction in which it acquires, offers, sells or delivers Notes or has in its
possession or distributes any Memorandum or any such other material, in all
cases at its own expense; (ii) the Notes have not been and will not be offered
or sold within the United States or to, or for the account or benefit of, U.S.
persons except in accordance with Regulation S under the Act or pursuant to an
exemption from the registration requirements of the Act; (iii) it has offered
the Notes and will offer and sell the Notes (A) as part of its distribution at
any time and (B) otherwise until 40 days after the later of the commencement of
the offering and the Closing Date, only in accordance with Rule 903 of
Regulation S and, accordingly, neither it nor any persons acting on its behalf
have engaged or will engage in any directed selling efforts (within the meaning
of Regulation S) with respect to the Notes, and any such persons have complied
and will comply with the offering restrictions requirement of Regulation S; and
(iv) it agrees that, at or prior to confirmation of sales of the Notes, it will
have sent to each distributor, dealer or person receiving a selling concession,
fee or other remuneration that purchases Notes from it during the restricted
period a confirmation or notice to substantially the following effect:
"The Securities covered hereby have not been registered under the
United States Securities Act of 1933 (the "Securities Act") and may not
be offered and sold within the United States or to, or for the account
or benefit of, U.S. persons (i) as part of the distribution of the
Securities at any time or (ii) otherwise until 40 days after the later
of the commencement of the offering and the closing date of the
offering, except in either case in accordance with Regulation S (or
Rule 144A if available) under the Securities Act. Terms used above have
the meaning given to them in Regulation S."
Terms used in this Section 8 and not defined in this
Agreement have the meanings given to
them in Regulation S.
-27-
9. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless the Initial Purchasers, and each person, if any, who
controls any Initial Purchaser within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, against any losses, claims, damages or
liabilities to which any Initial Purchaser or such controlling person may become
subject under the Act, the Exchange Act or otherwise, insofar as any such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon:
(i) any untrue statement or alleged untrue statement of any
material fact contained in any Memorandum or any amendment or
supplement thereto or any application or other document, or any
amendment or supplement thereto, executed by the Company or based upon
written information furnished by or on behalf of the Company filed in
any jurisdiction in order to qualify the Notes under the securities or
"Blue Sky" laws thereof or filed with any securities association or
securities exchange (each an "Application"); or
(ii) the omission or alleged omission to state, in any
Memorandum or any amendment or supplement thereto or any Application, a
material fact required to be stated therein or necessary to make the
statements therein not misleading,
and will reimburse, as incurred, the Initial Purchasers and each such
controlling person for any legal or other expenses reasonably incurred by the
Initial Purchasers or such controlling person in connection with investigating,
defending against or appearing as a third-party witness in connection with any
such loss, claim, damage, liability or action; provided, however, the Company
will not be liable in any such case to the extent that any such loss, claim,
damage, or liability arises out of or is based upon any untrue statement or
alleged untrue statement or omission or alleged omission made in any Memorandum
or any amendment or supplement thereto or any Application in reliance upon and
in conformity with written information concerning the Initial Purchasers
furnished to the Company by the Initial Purchasers specifically for use therein.
This indemnity agreement will be in addition to any liability that the Company
may otherwise have to the indemnified parties. The Company shall not be liable
under this Section 9 for any settlement of any claim or action effected without
its prior written consent, which shall not be unreasonably withheld.
-28-
(b) The Initial Purchasers agree to indemnify and hold
harmless the Company, its directors, its officers and each person, if any, who
controls the Company within the meaning of Section 15 of the Act or Section 20
of the Exchange Act against any losses, claims, damages or liabilities to which
the Company or any such director, officer or controlling person may become
subject under the Act, the Exchange Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon (i) any untrue statement or alleged untrue statement of any
material fact contained in any Memorandum or any amendment or supplement thereto
or any Application, or (ii) the omission or the alleged omission to state
therein a material fact required to be stated in any Memorandum or any amendment
or supplement thereto or any Application, or necessary to make the statements
therein 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 reliance upon and in conformity with written information
concerning such Initial Purchaser, furnished to the Company by the Initial
Purchasers specifically for use therein; and subject to the limitation set forth
immediately preceding this clause, will reimburse, as incurred, any legal or
other expenses reasonably incurred by the Company or any such director, officer
or controlling person in connection with investigating or defending against or
appearing as a third party witness in connection with any such loss, claim,
damage, liability or action in respect thereof. This indemnity agreement will be
in addition to any liability that the Initial Purchasers may otherwise have to
the indemnified parties. The Initial Purchasers shall not be liable under this
Section 9 for any settlement of any claim or action effected without their
consent, which shall not be unreasonably withheld. The Company shall not,
without the prior written consent of the Initial Purchasers, effect any
settlement or compromise of any pending or threatened proceeding in respect of
which any Initial Purchaser is or could have been a party, or indemnity could
have been sought hereunder by any Initial Purchaser, which settlement or
compromise would be applicable to the Initial Purchasers unless such settlement
(A) includes an unconditional written release of the Initial Purchasers, in form
and substance reasonably satisfactory to the Initial Purchasers, from all
liability on claims that are the subject matter of such proceeding and (B) does
not include any statement as to an admission of fault, culpability or failure to
act by or on behalf of any Initial Purchaser.
(c) Promptly after receipt by an indemnified party under this
Section 9 of notice of the commencement of any ac-
-29-
tion for which such indemnified party is entitled to indemnification under this
Section 9, such indemnified party will, if a claim in respect thereof is to be
made against the indemnifying party under this Section 9, notify the
indemnifying party of the commencement thereof in writing; but the omission to
so notify the indemnifying party (i) will not relieve it from any liability
under paragraph (a) or (b) above unless and to the extent such failure results
in material prejudice to the indemnifying party and (ii) will not, in any event,
relieve the indemnifying party from any obligations to any indemnified party
other than the indemnification obligation provided in paragraphs (a) and (b)
above. In case any such action is brought against any indemnified party, and it
notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein and, to the extent that it may
wish, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel reasonably satisfactory to such indemnified
party; provided, however, that if (i) the use of counsel chosen by the
indemnifying party to represent the indemnified party would present such counsel
with a conflict of interest, (ii) the defendants in any such action include both
the indemnified party and the indemnifying party and the indemnified party shall
have been advised by counsel that there may be one or more legal defenses
available to it and/or other indemnified parties that are different from or
additional to those available to the indemnifying party, or (iii) the
indemnifying party shall not have employed counsel reasonably satisfactory to
the indemnified party to represent the indemnified party within a reasonable
time after receipt by the indemnifying party of notice of the institution of
such action, then, in each such case, the indemnifying party shall not have the
right to direct the defense of such action on behalf of such indemnified party
or parties and such indemnified party or parties shall have the right to select
separate counsel to defend such action on behalf of such indemnified party or
parties. After notice from the indemnifying party to such indemnified party of
its election so to assume the defense thereof and approval by such indemnified
party of counsel appointed to defend such action, the indemnifying party will
not be liable to such indemnified party under this Section 9 for any legal or
other expenses, other than reasonable costs of investigation, subsequently
incurred by such indemnified party in connection with the defense thereof,
unless (i) the indemnified party shall have employed separate counsel in
accordance with the proviso to the immediately preceding sentence (it being
understood, however, that in connection with such action the indemnifying party
shall not be liable for the expenses of more than one separate counsel (in
addition to local counsel) in any one
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action or separate but substantially similar actions in the same jurisdiction
arising out of the same general allegations or circumstances, designated by the
Initial Purchasers in the case of paragraph (a) of this Section 9 or the Company
in the case of paragraph (b) of this Section 9, representing all of the
indemnified parties under such paragraph (a) or paragraph (b), as the case may
be, who are parties to such action or actions) or (ii) the indemnifying party
has authorized in writing the employment of counsel for the indemnified party at
the expense of the indemnifying party. After such notice from the indemnifying
party to such indemnified party, the indemnifying party will not be liable for
the costs and expenses of any settlement of such action effected by such
indemnified party without the prior written consent of the indemnifying party
(which consent shall not be unreasonably withheld), unless such indemnified
party waived in writing its rights under this Section 9, in which case the
indemnified party may effect such a settlement without such consent.
(d) In circumstances in which the indemnity agreement provided
for in the preceding paragraphs of this Section 9 is unavailable to, or
insufficient to hold harmless, an indemnified party in respect of any losses,
claims, damages or liabilities (or actions in respect thereof), each
indemnifying party, in order to provide for just and equitable contribution,
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages or liabilities (or actions in respect
thereof) in such proportion as is appropriate to reflect (i) the relative
benefits received by the indemnifying party or parties on the one hand and the
indemnified party on the other from the offering of the Notes or (ii) if the
allocation provided by the foregoing clause (i) is not permitted by applicable
law, not only such relative benefits but also the relative fault of the
indemnifying party or parties on the one hand and the indemnified party on the
other in connection with the statements or omissions or alleged statements or
omissions that resulted in such losses, claims, damages or liabilities (or
actions in respect thereof). The relative benefits received by the Company on
the one hand and any Initial Purchaser on the other shall be deemed to be in the
same proportion as the total proceeds from the offering (before deducting
expenses) received by the Company bear to the total discounts and commissions or
other compensation received by such Initial Purchaser with respect to the Notes
purchased hereunder. The relative fault of the parties shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to infor-
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mation supplied by the Company on the one hand, or such Initial Purchaser on the
other, the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission or alleged
statement or omission, and any other equitable considerations appropriate in the
circumstances. The Company and the Initial Purchasers agree that it would not be
equitable if the amount of such contribution were determined by pro rata or per
capita allocation or by any other method of allocation that does not take into
account the equitable considerations referred to in the first sentence of this
paragraph (d). Notwithstanding any other provision of this paragraph (d), no
Initial Purchaser shall be obligated to make contributions hereunder that in the
aggregate exceed the total discounts, commissions and other compensation
received by such Initial Purchaser under this Agreement, less the aggregate
amount of any damages that such Initial Purchaser has otherwise been required to
pay by reason of the untrue or alleged untrue statements or the omissions or
alleged omissions to state a material fact, and no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this paragraph (d), each person, if any, who
controls an Initial Purchaser within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act shall have the same rights to contribution as the
Initial Purchasers, and each director of the Company, each officer of the
Company and each person, if any, who controls the Company within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, shall have the same
rights to contribution as the Company.
10. Survival Clause. The respective representations,
warranties, agreements, covenants, indemnities and other statements of the
Company, its officers and the Initial Purchasers set forth in this Agreement or
made by or on behalf of them pursuant to this Agreement shall remain in full
force and effect, regardless of (i) any investigation made by or on behalf of
the Company, any of its officers or directors, the Initial Purchasers or any
controlling person referred to in Section 9 hereof and (ii) delivery of and
payment for the Notes. The respective agreements, covenants, indemnities and
other statements set forth in Sections 6, 9 and 15 hereof shall remain in full
force and effect, regardless of any termination or cancellation of this
Agreement.
11. Termination. (a) This Agreement may be terminated in the
sole discretion of the Initial Purchasers by notice to the Company given prior
to the Closing Date in the
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event that the Company shall have failed, refused or been unable to perform in
all material respects all obligations and satisfy all conditions on its part to
be performed or satisfied hereunder at or prior thereto or, if at or prior to
the Closing Date:
(i) the Company shall have sustained any loss or
interference with respect to its businesses or properties from fire,
flood, hurricane, accident or other calamity, whether or not covered by
insurance, or from any strike, labor dispute, slowdown or work stoppage
or any legal or governmental proceeding, which loss or interference, in
the sole judgment of the Initial Purchasers, has had or has a Material
Adverse Effect, or there shall have been, in the sole judgment of the
Initial Purchasers, any event or development that, individually or in
the aggregate, has or could be reasonably likely to have a Material
Adverse Effect (including without limitation a change in control of the
Company), except in each case as described in the Final Memorandum
(exclusive of any amendment or supplement thereto);
(ii) trading in securities generally on the New York Stock
Exchange, American Stock Exchange or the NASDAQ National Market shall
have been suspended or minimum or maximum prices shall have been
established on any such exchange or market;
(iii) a banking moratorium shall have been declared by New
York or United States authorities; or
(iv) there shall have been (A) an outbreak or escalation of
hostilities between the United States and any foreign power, or (B) an
outbreak or escalation of any other insurrection or armed conflict
involving the United States or any other national or international
calamity or emergency, or (C) any material change in the financial
markets of the United States which, in the case of (A), (B) or (C)
above and in the sole judgment of the Initial Purchasers, makes it
impracticable or inadvisable to proceed with the offering or the
delivery of the Notes as contemplated by the Final Memorandum.
(b) Termination of this Agreement pursuant to this Section 11
shall be without liability of any party to any other party except as provided in
Section 10 hereof.
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12. Information Supplied by the Initial Purchasers. The
statements set forth in the last paragraph on the front cover page, the first
paragraph on page (ii), in the second and third sentences of the third paragraph
and the third and fourth sentences of the fifth paragraph and the last paragraph
under the heading "Private Placement" in the Final Memorandum (to the extent
such statements relate to the Initial Purchasers) constitute the only
information furnished by the Initial Purchasers to the Company for the purposes
of Sections 2(a) and 9 hereof.
13. Notices. All communications hereunder shall be in writing
and, if sent to the Initial Purchasers, shall be mailed or delivered to BT Alex.
Xxxxx Incorporated, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Corporate Finance Department; if sent to the Company, shall be mailed or
delivered to the Company at 0000 Xxxxxxxxxx, Xxxxxxx, Xxxxx 00000, Attention:
Xxxxx Xxxxxx, Chief Financial Officer; with a copy to (i) Xxxxxx Xxxxxx Partners
III, L.P., 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, XX 00000, Attention: Xxxxxxx X.
Xxxxxx and Xxxxxxx X. Xxxxxxx and (ii) Xxxxxxx Xxxx & Xxxxx LLP, 000 Xxxxx
Xxxxxx, Xxx Xxxx, XX 00000, Attention: Xxxxx Xxxxx, Esq.
All such notices and communications shall be deemed to have
been duly given: when delivered by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; and one
business day after being timely delivered to a next-day air courier.
14. Successors. This Agreement shall inure to the benefit of
and be binding upon the Initial Purchasers, the Company and their respective
successors and legal representatives, and nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any other person any legal
or equitable right, remedy or claim under or in respect of this Agreement, or
any provisions herein contained; this Agreement and all conditions and
provisions hereof being intended to be and being for the sole and exclusive
benefit of such persons and for the benefit of no other person except that (i)
the indemnities of the Company contained in Section 9 of this Agreement shall
also be for the benefit of any person or persons who control the Initial
Purchasers within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act and (ii) the indemnities of the Initial Purchasers contained in
Section 9 of this Agreement shall also be for the benefit of the directors of
the Company, its officers and any person or persons who control the Company
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act.
No purchaser of Notes from the
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Initial Purchasers will be deemed a successor because of such purchase.
15. APPLICABLE LAW. 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.
16. Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
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If the foregoing correctly sets forth our understanding,
please indicate your acceptance thereof in the space provided below for that
purpose, whereupon this letter shall constitute a binding agreement between the
Company and the Initial Purchasers.
Very truly yours,
TW ACQUISITION CORPORATION
By: /s/ Xxxxx Xxxxxx
-----------------------------
Name: Xxxxx Xxxxxx
Title: Chief Financial Officer
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The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
BT ALEX. XXXXX INCORPORATED
By: /s/ Xxxxx Xxxxxxx
----------------------------
Name: Xxxxx Xxxxxxx
Title: Vice President
SALOMON BROTHERS INC
By: /s/ Xxxxx Xxxxxxxx
----------------------------
Name: Xxxxx Xxxxxxxx
Title: Vice President
SCHEDULE 1
Principal
Amount of
Initial Purchaser Notes at Maturity
----------------- -----------------
BT Alex. Xxxxx Incorporated............................. $145,500,000
Salomon Brothers Inc.................................... $ 97,000,000
------------
Total......................................... $242,500,000
