EXHIBIT 1.1
AMERICAN STORES COMPANY
12,326,330 Shares
Common Stock (par value $1.00 per share)
Underwriting Agreement
(U.S. Version)
------------------------
April , 1997
Xxxxxxx, Xxxxx & Co.,
X.X. Xxxxxx Securities Inc.,
Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation,
Xxxxxx Xxxxxxx & Co. Incorporated,
Xxxxx Xxxxxx Inc.,
As representatives of the several Underwriters
named in Schedule I hereto,
c/o Goldman, Xxxxx & Co.
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Certain stockholders named in Schedule II hereto (the "Selling
Stockholders") of American Stores Company, a Delaware corporation (the
"Company"), propose, subject to the terms and conditions stated herein, to sell
to the Underwriters named in Schedule I hereto (the "Underwriters") an aggregate
of 12,326,330 shares (the "Firm Shares") and the Company proposes to issue and
sell to the Underwriters, at the election of the Underwriters, up to 1,848,949
additional shares (the "Optional Shares") of Common Stock (par value $1.00 per
share) ("Stock") of the Company (the Firm Shares and the Optional Shares that
the Underwriters elect to purchase pursuant to Section 2 hereof are herein
collectively called the "Shares").
It is understood and agreed to by all parties that the Company and the
Selling Stockholders are concurrently entering into an agreement (the
"International
Underwriting Agreement") providing for the sale by the Company and the Selling
Stockholders of up to a total of 3,543,817 shares of Stock (the "International
Shares"), including the overallotment option thereunder, through arrangements
with certain underwriters outside the United States (the "International
Underwriters"), for whom Xxxxxxx Sachs International and X.X. Xxxxxx Securities
Ltd. are acting as joint lead managers. Anything herein or therein to the
contrary notwithstanding, the respective closings under this Agreement and the
International Underwriting Agreement are hereby expressly made conditional on
one another. The Underwriters hereunder and the International Underwriters are
simultaneously entering into an Agreement between U.S. and International
Underwriting Syndicates (the "Agreement between Syndicates") which provides,
among other things, for the transfer of shares of Stock between the two
syndicates. Two forms of prospectus are to be used in connection with the
offering and sale of shares of Stock contemplated by the foregoing, one relating
to the Shares hereunder and the other relating to the International Shares. The
latter form of prospectus will be identical to the former except for certain
substitute pages as included in the registration statement, as amended, as
mentioned below. Except as used in Sections 2, 3, 4, 9 and 11 herein, and except
as the context may otherwise require, references hereinafter to the Shares shall
include all the shares of Stock which may be sold pursuant to either this
Agreement or the International Underwriting Agreement (and references herein to
the Firm Shares or the Optional Shares shall have a similar meaning), and
references herein to any prospectus whether in preliminary or final form, and
whether as amended or supplemented, shall include both the U.S. and the
international versions thereof.
1. (a) The Company represents and warrants to, and agrees with,
each of the Underwriters and the Selling Stockholders that:
(i) A registration statement on Form S-3 (File No. 333-22701)
(the "Initial Registration Statement") in respect of the Shares has been
filed with the Securities and Exchange Commission (the "Commission");
the Initial Registration Statement and any post-effective amendment
thereto, each in the form heretofore delivered to you for each of the
other Underwriters, and, excluding exhibits thereto but including all
documents incorporated by reference in the prospectus contained therein,
have been declared effective by the Commission in such form; other than
a registration statement, if any, increasing the size of the offering (a
"Rule 462(b) Registration Statement"), filed pursuant to Rule 462(b)
under the Securities Act of 1933, as amended (the "Act"), which became
effective upon filing, no other document with respect to the Initial
Registration Statement or document incorporated by reference therein has
heretofore been filed with the Commission; and no stop
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order suspending the effectiveness of the Initial Registration
Statement, any post-effective amendment thereto or the Rule 462(b)
Registration Statement, if any, has been issued and no proceeding for
that purpose has been initiated or threatened by the Commission (any
preliminary prospectus included in the Initial Registration Statement or
filed with the Commission pursuant to Rule 424(a) of the rules and
regulations of the Commission under the Act is hereinafter called a
"Preliminary Prospectus"; the various parts of the Initial Registration
Statement and the Rule 462(b) Registration Statement, if any, including
all exhibits thereto and including (i) the information contained in the
form of final prospectus filed with the Commission pursuant to Rule
424(b) under the Act in accordance with Section 5(a) hereof and deemed
by virtue of Rule 430A under the Act to be part of the Initial
Registration Statement at the time it was declared effective and (ii)
the documents incorporated by reference in the prospectus contained in
the registration statement at the time such part of the registration
statement became effective or such part of the Rule 462(b) Registration
Statement, if any, became or hereafter becomes effective, each as
amended at the time such part of the registration statement became
effective, are hereinafter collectively called the "Registration
Statement"; and such final prospectus, in the form first filed pursuant
to Rule 424(b) under the Act, is hereinafter called the "Prospectus";
and any reference herein to any Preliminary Prospectus or the Prospectus
shall be deemed to refer to and include the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 under the Act, as of
the date of such Preliminary Prospectus or Prospectus, as the case may
be; any reference to any amendment or supplement to any Preliminary
Prospectus or the Prospectus shall be deemed to refer to and include any
documents filed after the date of such Preliminary Prospectus or
Prospectus, as the case may be, under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and incorporated by reference in
such Preliminary Prospectus or Prospectus, as the case may be; and any
reference to any amendment to the Registration Statement shall be deemed
to refer to and include any annual report of the Company filed pursuant
to Section 13(a) or 15(d) of the Exchange Act after the effective date
of the Registration Statement that is incorporated by reference in the
Registration Statement);
(ii) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary
Prospectus, at the time of filing thereof, conformed in all material
respects to the requirements of the Act and the rules and regulations of
the Commission thereunder, and did not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the
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statements therein, in the light of the circumstances under which they
were made, not misleading; provided, however, that this representation
and warranty shall not apply to any statements or omissions made in
reliance upon and in conformity with information furnished in writing to
the Company by an Underwriter through Xxxxxxx, Sachs & Co. expressly for
use therein or by a Selling Stockholder expressly for use in the
preparation of the answers therein to Item 7 of Form S-3;
(iii) The documents incorporated by reference in the Prospectus,
when they became effective or were filed with the Commission, as the
case may be, conformed in all material respects to the requirements of
the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder, and none of such documents
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; and any further documents so filed
and incorporated by reference in the Prospectus or any further amendment
or supplement thereto, when such documents become effective or are filed
with the Commission, as the case may be, will conform in all material
respects to the requirements of the Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission thereunder
and will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make
the statements therein not misleading; provided, however, that this
representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information
furnished in writing to the Company by an Underwriter through Xxxxxxx,
Sachs & Co. expressly for use therein;
(iv) The Registration Statement conforms, and the Prospectus and
any further amendments or supplements to the Registration Statement or
the Prospectus will conform, in all material respects to the
requirements of the Act and the rules and regulations of the Commission
thereunder and do not and will not, as of the applicable effective date
as to the Registration Statement and any amendment thereto and as of the
applicable filing date as to the Prospectus and any amendment or
supplement thereto, contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading; provided, however, that
this representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information
furnished in writing to the Company by an Underwriter through Xxxxxxx,
Sachs & Co. expressly for use therein or by a Selling Stockholder
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expressly for use in the preparation of the answers therein to Item 7 of
Form S-3;
(v) The financial statements, and the related notes thereto,
included or incorporated by reference in the Registration Statement and
the Prospectus present fairly, in all material respects, the financial
position of the Company and its consolidated subsidiaries as of the
dates indicated and the results of their operations and the changes in
their consolidated cash flows for the periods specified; said financial
statements have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis, and the supporting
schedules included or incorporated by reference in the Registration
Statement present fairly, in all material respects, the information
required to be stated therein as of the dates indicated;
(vi) Since the respective dates as of which information is given
in the Registration Statement and the Prospectus, there has not been any
material adverse change in the business, business prospects, financial
position, shareholders' equity or results of operations of the Company
and its subsidiaries, taken as a whole, otherwise than as set forth or
contemplated in the Prospectus;
(vii) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus, and
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 properties, or conducts any
business, so as to require such qualification, other than where the
failure to be so qualified or in good standing would not have a material
adverse effect on the Company and its subsidiaries taken as a whole;
(viii) Each Significant Subsidiary (as defined in Regulation S-X
promulgated by the Commission) of the Company has been duly incorporated
and is validly existing as a corporation under the laws of its
jurisdiction of incorporation, with power and authority (corporate and
other) to own its properties and conduct its business as described in
the Prospectus, and has been duly qualified as a foreign corporation for
the transaction of business and is in good standing under the laws of
each jurisdiction in which it owns or leases properties or conducts any
business so as to require such qualification, other than where the
failure to be so qualified or in good standing would not
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have a material adverse effect on the Company and its subsidiaries taken
as a whole; and all the outstanding shares of capital stock of each
Significant Subsidiary have been duly authorized and validly issued, are
fully-paid and non-assessable, and (except as contemplated by the
Prospectus) are owned by the Company, directly or indirectly, free and
clear of all liens, encumbrances, security interests and claims;
(ix) neither the Company nor any Significant Subsidiary is, or
with the giving of notice or lapse of time or both would be, in
violation of or in default under (A) its Certificate of Incorporation or
By-Laws or (B) any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument (including, without limitation, the Stock
Purchase Agreement dated as of February 20, 1997 by and among the
Company, Xxxxxx Xxx Xxxxxx, Xxxxx X. Xxxxxx and certain stockholders
(the "Stock Purchase Agreement") and the Registration Rights Agreement
dated as of February 20, 1997 among the Company and the stockholders
named therein (the "Registration Rights Agreement")) to which the
Company or any Significant Subsidiary is a party or by which it or any
of them or any of their respective properties is bound, except for
violations and defaults of any agreement or instrument described in
clause (B) which individually and in the aggregate would not have a
material adverse effect on the Company and its subsidiaries taken as a
whole; the issue and sale of the Optional Shares to be sold by the
Company, and the sale of the Firm Shares to be sold by the Selling
Stockholders, hereunder and under the International Underwriting
Agreement and the performance by the Company of its obligations under
this Agreement and the International Underwriting Agreement and the
consummation of the transactions herein and therein contemplated will
not conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument
(including, without limitation, the Stock Purchase Agreement or the
Registration Rights Agreement) to which the Company or any Significant
Subsidiary is a party or by which the Company or any Significant
Subsidiary is bound or to which any of the property or assets of the
Company or any Significant Subsidiary is subject, except for violations
and defaults which individually and in the aggregate would not have a
material adverse effect on the Company and its subsidiaries taken as a
whole, nor will any such action result in any violation of the
provisions of the Restated Certificate of Incorporation or the By-Laws
of the Company or any material violation of any applicable law or
statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Company, any Significant
Subsidiary or any of their respective properties; and no consent,
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approval, authorization, order, registration or qualification of or with
any such court or governmental agency or body is required for the issue
and sale of the Shares to be sold by the Company or the consummation by
the Company of the transactions contemplated by this Agreement and the
International Underwriting Agreement, except such consents, approvals,
authorizations, registrations or qualifications (x) as have been
obtained under the Act and as may be required under the applicable
securities or Blue Sky Laws of the various states and other
jurisdictions in connection with the issue, sale and distribution of the
Shares or (y) of which the failure to obtain would not individually and
in the aggregate have a material adverse effect on the Company and its
subsidiaries taken as a whole;
(x) The Company has an authorized capitalization as set forth in
the Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued, and are fully
paid and non-assessable; and such shares conform in all material
respects to the description of the Stock contained in the Prospectus;
(xi) The unissued Shares that may be issued and sold by the
Company to the Underwriters hereunder and under the International
Underwriting Agreement have been duly and validly authorized and, when
issued and delivered against payment therefor as provided herein, will
be duly and validly issued and fully paid and non-assessable; and such
shares will conform in all material respects to the description of the
Stock contained in the Prospectus;
(xii) Each of this Agreement and the International Underwriting
Agreement has been duly authorized, executed and delivered by the
Company;
(xiii) The execution, delivery and performance of the Stock
Purchase Agreement, the Registration Rights Agreement, this Agreement
and the International Underwriting Agreement shall not, except in the
event that a person becomes the Beneficial Owner (as defined in the
Rights Agreement dated as of March 8, 1988, as amended March 20, 1990,
June 24, 1996 and February 20, 1997, between the Company and First
Chicago Trust Company of New York as Rights Agent (the "Rights
Agreement")) of 10% or more of the outstanding Stock as a result of the
Offerings, (i) cause the preferred share purchase rights issued pursuant
to the Rights Agreement to become exercisable, (ii) cause any Seller or
Seller Affiliate (each as defined in the Stock Purchase Agreement) to
become an "Acquiring Person" (as defined in
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the Rights Agreement) or (iii) cause a "Distribution Date" (as defined
in the Rights Agreement) to occur;
(xiv) Other than as set forth or contemplated in the Prospectus,
there are no legal or governmental proceedings pending or, to the
knowledge of the Company, threatened to which the Company or any
Significant Subsidiary is or may be a party or to which any property of
the Company or any Significant Subsidiary is or may be the subject that
are required to be described in the Prospectus that are not so
described; and there are no contracts or other documents of a character
required to be filed as an exhibit to the Registration Statement or
required to be described in the Registration Statement or the Prospectus
which are not filed or described as required;
(xv) The statements set forth in the Prospectus under the caption
"Description of Capital Stock--Common Stock" are an accurate summary of
the terms of the Stock in all material respects;
(xvi) The Company is not and, after giving effect to the offering
and sale of the Shares, will not be 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"); and
(xvii) Ernst & Young LLP, who have certified certain financial
statements of the Company and its subsidiaries, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder.
(b) Each of the Selling Stockholders severally represents and warrants
to, and agrees with, each of the Underwriters and the Company that:
(i) All consents, approvals, authorizations and orders
necessary for the execution and delivery by such Selling Stockholder of
this Agreement, the International Underwriting Agreement, the Stock
Purchase Agreement, the Registration Rights Agreement and the Power of
Attorney and Custody Agreement hereinafter referred to, and for the sale
and delivery of the Firm Shares to be sold by such Selling Stockholder
hereunder and under the International Underwriting Agreement, have been
obtained, except for the registration of Shares under the Act and such
as may be required under foreign and state securities and Blue Sky laws;
and such Selling Stockholder has full right, power and authority to
enter into this Agreement, the
8
International Underwriting Agreement, the Stock Purchase Agreement, the
Registration Rights Agreement and the Power of Attorney and Custody
Agreement and to sell, assign, transfer and deliver the Firm Shares to
be sold by such Selling Stockholder hereunder and under the
International Underwriting Agreement;
(ii) The sale of the Firm Shares to be sold by such Selling
Stockholder hereunder and under the International Underwriting Agreement
and the compliance by such Selling Stockholder with all of the
provisions of this Agreement, the International Underwriting Agreement,
the Stock Purchase Agreement, the Registration Rights Agreement and the
Power of Attorney and Custody Agreement and the consummation of the
transactions herein and therein contemplated will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any statute, indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which such
Selling Stockholder is a party or by which such Selling Stockholder is
bound, or to which any of the property or assets of such Selling
Stockholder is subject, nor will such action result in any violation of
the provisions of the Certificate of Incorporation or By-laws of such
Selling Stockholder if such Selling Stockholder is a corporation, the
Declaration of Trust or other constituent documents if such Selling
Stockholder is a trust, foundation or institute, the Partnership
Agreement of such Selling Stockholder if such Selling Stockholder is a
partnership, or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over such
Selling Stockholder or the property of such Selling Stockholder, except
that such Selling Stockholder makes no representation as to the
registration or filing requirements or disclosure provisions of the
securities laws of the United States or the securities or Blue Sky laws
of any other jurisdiction;
(iii) Such Selling Stockholder has, and immediately prior to Time
of Delivery (as defined in Section 4 hereof) such Selling Stockholder
will have, good and valid title to the Firm Shares to be sold by such
Selling Stockholder hereunder and under the International Underwriting
Agreement, free and clear of all liens, encumbrances, equities or
claims; and, upon delivery of such Firm Shares and payment therefor
pursuant hereto and thereto, good and valid title to such Firm Shares,
free and clear of all liens, encumbrances, equities or claims, will pass
to the several Underwriters or the International Underwriters, as the
case may be (assuming that the several Underwriters and the several
International Underwriters are without notice of any adverse claim, as
defined in the Uniform Commercial Code as adopted in the State of New
9
York (the "Code") and are otherwise bona fide purchasers for the
purposes of the Code, and that such Underwriters' and International
Underwriters' rights are not limited by subsection (4) of Section 8-302
of the Code);
(iv) During the period beginning from the date hereof and
continuing to and including the date 90 days after the date of the
Prospectus, not to offer, sell, contract to sell or otherwise dispose
of, except as provided hereunder or under the International Underwriting
Agreement, any securities of the Company that are substantially similar
to the Shares, including but not limited to any securities that are
convertible into or exchangeable for, or that represent the right to
receive, Stock or any such substantially similar securities (other than
pursuant to employee stock option or purchase plans or director
incentive plans, or upon the conversion or exchange of convertible or
exchangeable securities outstanding on the date of this Agreement),
without your prior written consent;
(v) Such Selling Stockholder has not taken and will not take,
directly or indirectly, any action which is designed to or which has
constituted or which might reasonably be expected to cause or result in
stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Shares;
(vi) To the extent that any statements or omissions made in the
Registration Statement, any Preliminary Prospectus, the Prospectus or
any amendment or supplement thereto are made in reliance upon and in
conformity with written information furnished to the Company by such
Selling Stockholder expressly for use therein, such Preliminary
Prospectus and the Registration Statement did, and the Prospectus and
any further amendments or supplements to the Registration Statement and
the Prospectus, when they become effective or are filed with the
Commission, as the case may be, will conform in all material respects to
the requirements of the Act and the rules and regulations of the
Commission thereunder and did not and will not contain any untrue
statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not
misleading;
(vii) In order to document the Underwriters' compliance with the
reporting and withholding provisions of the Tax Equity and Fiscal
Responsibility Act of 1982 with respect to the transactions herein
contemplated, such Selling Stockholder will deliver to you prior to or
at the First Time of Delivery (as hereinafter defined) a properly
completed and
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executed United States Treasury Department Form W-9 (or other applicable
form or statement specified by Treasury Department regulations in lieu
thereof);
(viii) Certificates in negotiable form representing all of the
Firm Shares to be sold by such Selling Stockholder hereunder and under
the International Underwriting Agreement have been placed in custody
under an Irrevocable Power of Attorney and Custody Agreement, in the
form heretofore furnished to you (the "Power of Attorney and Custody
Agreement"), duly executed and delivered by such Selling Stockholder to
First Chicago Trust Company of New York, as custodian (the "Custodian"),
and appointing the persons indicated in Schedule II hereto, and each of
them, as such Selling Stockholder's attorneys-in-fact (the
"Attorneys-in-Fact") with authority to execute and deliver this
Agreement and the International Underwriting Agreement on behalf of such
Selling Stockholder, to determine the purchase price to be paid by the
Underwriters and the International Underwriters to the Selling
Stockholders as provided in Section 2 hereof, to authorize the delivery
of the Firm Shares to be sold by such Selling Stockholder hereunder and
otherwise to act on behalf of such Selling Stockholder in connection
with the transactions contemplated by this Agreement, the International
Underwriting Agreement and the Power of Attorney and Custody Agreement;
and
(ix) The Firm Shares represented by the certificates held in
custody for such Selling Stockholder under the Power of Attorney and
Custody Agreement are subject to the interests of the Underwriters
hereunder and the International Underwriters under the International
Underwriting Agreement; the arrangements made by such Selling
Stockholder for such custody, and the appointment by such Selling
Stockholder of the Attorneys-in-Fact by the Power of Attorney and
Custody Agreement, are to that extent irrevocable; the obligations of
the Selling Stockholders hereunder shall not be terminated by operation
of law, whether by the death or incapacity of any individual Selling
Stockholder or, in the case of an estate or trust, by the death or
incapacity of any executor or trustee or the termination of such estate
or trust, or in the case of a partnership or corporation, by the
dissolution of such partnership or corporation, or by the occurrence of
any other event; if any individual Selling Stockholder or any such
executor or trustee should die or become incapacitated, or if any such
estate or trust should be terminated, or if any such partnership or
corporation should be dissolved, or if any other such event should
occur, before the delivery of the Firm Shares hereunder, certificates
representing the Firm Shares shall be delivered by or on behalf of the
Selling
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Stockholders in accordance with the terms and conditions of this
Agreement, of the International Underwriting Agreement and of the Power
of Attorney and Custody Agreements; and actions taken by the
Attorneys-in-Fact pursuant to the Power of Attorney and Custody
Agreements shall be as valid as if such death, incapacity, termination,
dissolution or other event had not occurred, regardless of whether or
not the Custodian, the Attorneys-in-Fact, or any of them, shall have
received notice of such death, incapacity, termination, dissolution or
other event.
2. Subject to the terms and conditions herein set forth, (a) each
of the Selling Stockholders agrees, severally and not jointly, to sell to each
of the Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase from each of the Selling Stockholders, at a purchase price
per share of $...................., the number of Firm Shares (to be adjusted by
you so as to eliminate fractional shares) determined by multiplying the
aggregate number of Firm Shares to be sold by each of the Selling Stockholders
as set forth opposite their respective names in Schedule II hereto by a
fraction, the numerator of which is the aggregate number of Firm Shares to be
purchased by such Underwriter as set forth opposite the name of such Underwriter
in Schedule I hereto and the denominator of which is the aggregate number of
Firm Shares to be purchased by all of the Underwriters from all of the Selling
Stockholders hereunder and (b) in the event and to the extent that the
Underwriters shall exercise the election to purchase Optional Shares as provided
below, the Company agrees to sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company, at
the purchase price per share set forth in clause (a) of this Section 2, that
portion of the number of Optional Shares as to which such election shall have
been exercised (to be adjusted by you so as to eliminate fractional shares)
determined by multiplying such number of Optional Shares by a fraction the
numerator of which is the maximum number of Optional Shares which such
Underwriter is entitled to purchase as set forth opposite the name of such
Underwriter in Schedule I hereto and the denominator of which is the maximum
number of Optional Shares that all of the Underwriters are entitled to purchase
hereunder.
The Company hereby grants to the Underwriters the right to purchase at
their election up to 1,848,949 Optional Shares, at the purchase price per share
set forth in the paragraph above, for the sole purpose of covering
overallotments in the sale of the Firm Shares. Any such election to purchase
Optional Shares may be exercised only by written notice from you to the Company,
given within a period of 30 calendar days after the date of this Agreement and
setting forth the aggregate number of Optional Shares to be purchased and the
date on which such Optional Shares are to be delivered, as determined by you but
in no event earlier than the First Time of Delivery
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(as defined in Section 4 hereof) or, unless you and the Company otherwise agree
in writing, earlier than two or later than ten business days after the date of
such notice.
3. Upon the authorization by you of the release of the Firm Shares,
the several Underwriters propose to offer the Firm Shares for sale upon the
terms and conditions set forth in the Prospectus.
4. (a) The Shares to be purchased by each Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in such
names as Xxxxxxx, Xxxxx & Co. may request upon at least forty-eight hours' prior
notice to the Company and the Selling Stockholders shall be delivered by or on
behalf of the Company or the Selling Stockholders, as applicable, to Xxxxxxx,
Sachs & Co., through the facilities of The Depository Trust Company ("DTC"), for
the account of such Underwriter, against payment by or on behalf of such
Underwriter of the purchase price therefor in Federal or other funds immediately
available in New York City, made to the Company and the Custodian for each of
the Selling Stockholders, as their interests may appear. The Selling
Stockholders will cause the certificates representing the Firm Shares, and the
Company will cause the certificates representing the Optional Shares, to be made
available for checking and packaging at least twenty-four hours prior to the
Time of Delivery (as defined below) with respect thereto at the office of DTC or
its designated custodian (the "Designated Office"). The time and date of such
delivery and payment shall be, with respect to the Firm Shares, 9:30 a.m., New
York City time, on April ...., 1997 or such other time and date as Xxxxxxx,
Xxxxx & Co. and the Selling Stockholders may agree upon in writing, and, with
respect to the Optional Shares, 9:30 a.m., New York City time, on the date
specified by Xxxxxxx, Sachs & Co. in the written notice given by Xxxxxxx, Xxxxx
& Co. of the Underwriters' election to purchase such Optional Shares (consistent
with the terms hereof), or such other time and date as Xxxxxxx, Sachs & Co. and
the Company may agree upon in writing. Such time and date for delivery of the
Firm Shares is herein called the "First Time of Delivery", such time and date
for delivery of the Optional Shares, if not the First Time of Delivery, is
herein called the "Second Time of Delivery", and each such time and date for
delivery is herein called a "Time of Delivery".
(b) The documents to be delivered at each Time of Delivery by or on
behalf of the parties hereto pursuant to Section 7 hereof, including the
cross-receipts for the Shares and any additional documents requested by the
Underwriters pursuant to Section 7 hereof, will be delivered at the offices of
Xxxxx Xxxx & Xxxxxxxx, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or such
other location as may be mutually agreed (the "Closing Location"), and the
Shares will be delivered at the Designated Office, all at each Time of Delivery.
A meeting will be held at the Closing
13
Location at 3:00 p.m., New York City time, on the New York Business Day next
preceding each Time of Delivery, at which meeting the final drafts of the
documents to be delivered pursuant to the preceding sentence will be available
for review by the parties hereto. For the purposes of this Section 4, "New York
Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in New York are generally
authorized or obligated by law or executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and to file such
Prospectus pursuant to Rule 424(b) under the Act not later than the Commission's
close of business on the second business day following the execution and
delivery of this Agreement, or, if applicable, such earlier time as may be
required by Rule 430A(a)(3) under the Act; to make no further amendment or any
supplement to the Registration Statement or Prospectus prior to the last Time of
Delivery which shall be disapproved by you promptly after reasonable notice
thereof; to advise you, promptly after it receives notice thereof, of the time
when any amendment to the Registration Statement has been filed or becomes
effective or any supplement to the Prospectus or any amended Prospectus has been
filed and to furnish you copies thereof; to file promptly all reports and any
definitive proxy or information statements required to be filed by the Company
with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act subsequent to the date of the Prospectus and for so long as the
delivery of a prospectus is required in connection with the offering or sale of
the Shares; to advise you, promptly after it receives notice thereof, of the
issuance by the Commission of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or prospectus, of the
suspension of the qualification of the Shares for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding for any such
purpose, or of any request by the Commission for the amending or supplementing
of the Registration Statement or Prospectus or for additional information; and,
in the event of the issuance of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or prospectus or suspending any
such qualification, promptly to use its best efforts to obtain the withdrawal of
such order;
(b) Promptly from time to time to take such action as you may reasonably
request to qualify the Shares for offering and sale under the securities laws of
such jurisdictions as you may request and to comply with such laws so as to
permit the continuance of sales and dealings therein in such jurisdictions for
as long as may be necessary to complete the distribution of the Shares, provided
that in connection therewith the Company shall not be required to qualify as a
foreign corporation or to
14
file a general consent to service of process in any jurisdiction or obligated to
subject itself to any material additional tax or other liabilities;
(c) Prior to 10:00 a.m., New York City time, on the New York Business
Day next succeeding the date of this Agreement and from time to time, to furnish
the Underwriters with copies of the Prospectus in New York City in such
quantities as you may reasonably request, and, if the delivery of a prospectus
is required at any time prior to the expiration of nine months after the time of
issue of the Prospectus in connection with the offering or sale of the Shares
and if at such time any events shall have occurred as a result of which the
Prospectus as then amended or supplemented would include an untrue statement of
a material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made when such Prospectus is delivered, not misleading, or, if for any other
reason it shall be necessary during such period to amend or supplement the
Prospectus or to file under the Exchange Act any document incorporated by
reference in the Prospectus in order to comply with the Act or the Exchange Act,
to notify you and upon your request to file such document and to prepare and
furnish without charge to each Underwriter and to any dealer in securities as
many copies as you may from time to time reasonably request of an amended
Prospectus or a supplement to the Prospectus which will correct such statement
or omission or effect such compliance, and in case any Underwriter is required
to deliver a prospectus in connection with sales of any of the Shares at any
time nine months or more after the time of issue of the Prospectus, upon your
request but at the expense of such Underwriter, to prepare and deliver to such
Underwriter as many copies as you may request of an amended or supplemented
Prospectus complying with Section 10(a)(3) of the Act;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the effective
date of the Registration Statement (as defined in Rule 158(c) under the Act), an
earnings statement of the Company and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Act and the rules and regulations
of the Commission thereunder (including, at the option of the Company, Rule
158);
(e) During the period beginning from the date hereof and continuing to
and including the date 90 days after the date of the Prospectus, not to offer,
sell, contract to sell or otherwise dispose of, except as provided hereunder and
under the International Underwriting Agreement, any securities of the Company
that are substantially similar to the Shares, including but not limited to any
securities that are convertible into or exchangeable for, or that represent the
right to receive, Stock or any such substantially similar securities (other than
pursuant to employee stock option
15
or purchase plans or director incentive plans, or upon the conversion or
exchange of convertible or exchangeable securities outstanding on the date of
this Agreement; provided that (x) no such convertible or exchangeable securities
issued pursuant to such plans on or after the date hereof shall be convertible
into or exchangeable for Stock or any such substantially similar securities
prior to the expiration of such 90-day period and (y) any Stock or substantially
similar securities issued under such plans (other than securities issued upon
the conversion or exchange of outstanding securities) shall be subject to
restrictions on transfer during such 90-day period), without your prior written
consent;
(f) To furnish to its shareholders as soon as practicable after the end
of each fiscal year an annual report (including a balance sheet and statements
of income, shareholders' equity and cash flows of the Company and its
consolidated subsidiaries certified by independent public accountants);
(g) During a period of five years from the effective date of the
Registration Statement, to furnish to you copies of all reports or other
communications (financial or other) furnished by the Company to shareholders,
and to deliver to you as soon as they are available, copies of any reports and
financial statements furnished to or filed with the Commission or any national
securities exchange on which any class of securities of the Company is listed;
(h) To use the net proceeds, if any, received by it from the sale of the
Optional Shares pursuant to this Agreement and the International Underwriting
Agreement in the manner specified in the Prospectus under the caption "Use of
Proceeds";
(i) To use its best efforts to list, subject to notice of issuance, the
Optional Shares on the New York Stock Exchange (the "Exchange"); and
(j) If the Company elects to rely upon Rule 462(b), the Company shall
file a Rule 462(b) Registration Statement with the Commission in compliance with
Rule 462(b) by 10:00 P.M., Washington, D.C. time, on the date of this Agreement,
and the Company shall at the time of filing either pay to the Commission the
filing fee for the Rule 462(b) Registration Statement or give irrevocable
instructions for the payment of such fee pursuant to Rule 111(b) under the Act.
6. (a) The Company agrees with the Selling Stockholders and the
several Underwriters that the Company will pay or cause to be paid the
following: (i) the fees, disbursements and expenses of the Company's counsel and
accountants in connection with the registration of the Shares under the Act and
all other expenses of the
16
Company in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or producing
any Agreement among Underwriters, this Agreement, the International Underwriting
Agreement, the Agreement between Syndicates, the Selling Agreements, the Blue
Sky Memorandum, closing documents (including any compilations thereof) and any
other documents in connection with the offering, purchase, sale and delivery of
the Shares; (iii) all expenses in connection with the qualification of the
Shares for offering and sale under state securities laws as provided in Section
5(b) hereof, including the fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection with the
Blue Sky surveys; (iv) all fees and expenses in connection with listing the
Optional Shares on the Exchange to the extent required; (v) the cost and charges
of any transfer agent or registrar; (vi) the filing fees incident to, and the
fees and disbursements of counsel for the Underwriters in connection with,
securing any required review by the National Association of Securities Dealers,
Inc. of the terms of the sale of the Shares; and (vii) the reasonable fees and
expenses of one counsel for the Selling Stockholders; and (b) each of the
Selling Stockholders jointly and severally agrees with the Company and the
several Underwriters that the Selling Stockholders will pay or cause to be paid
all costs and expenses incident to the performance of such Selling Stockholders'
obligations hereunder which are not otherwise specifically provided for in this
Section, including (i) any fees and expenses of any other counsel for such
Selling Stockholders, (ii) the fees and expenses of the Attorneys-in-Fact and
the Custodian and (iii) all expenses and taxes incident to the sale and delivery
of the Firm Shares to be sold by such Selling Stockholder to the Underwriters
hereunder. In connection with clause (b)(iii) of the preceding sentence,
Xxxxxxx, Sachs & Co. agrees to pay New York State stock transfer tax, and the
Selling Stockholder agrees to reimburse Xxxxxxx, Xxxxx & Co. for associated
carrying costs if such tax payment is not rebated on the day of payment and for
any portion of such tax payment not rebated. It is understood, however, that,
except as provided in this Section, and Sections 8 and 11 hereof, the
Underwriters will pay all of their own costs and expenses, including the fees of
their counsel, stock transfer taxes on resale of any of the Shares by them, and
any advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters hereunder, as to the Shares to be
delivered at each Time of Delivery, shall be subject, in their discretion, to
the condition that all representations and warranties and other statements of
the Company and of the Selling Stockholders herein are, at and as of such Time
of Delivery, true and correct, the condition that the Company and the Selling
Stockholders shall have
17
performed in all material respects all of its and their obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant to
Rule 424(b) within the applicable time period prescribed for such filing by the
rules and regulations under the Act and in accordance with Section 5(a) hereof;
if the Company has elected to rely upon Rule 462(b), the Rule 462(b)
Registration Statement shall have become effective by 10:00 P.M., Washington,
D.C. time, on the date of this Agreement; no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have been
issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and all requests for additional information on the
part of the Commission shall have been complied with to your reasonable
satisfaction;
(b) Xxxxx Xxxx & Xxxxxxxx, counsel for the Underwriters, shall have
furnished to you such opinion or opinions dated such Time of Delivery, with
respect to the matters covered in paragraphs (i), (ii), (v), (vi), clause (B) of
paragraph (vii), and the last three paragraphs of subsection (c) below as well
as their opinion that the statements set forth in the Prospectus under the
caption "Underwriting", insofar as they purport to describe the provisions of
the laws and documents referred to therein, are accurate, complete and fair and
as to such other related matters as you may reasonably request, and such counsel
shall have received such papers and information as they may reasonably request
to enable them to pass upon such matters;
(c) Wachtell, Lipton, Xxxxx & Xxxx, counsel for the Company, shall have
furnished to you and the Selling Stockholders their written opinion, dated such
Time of Delivery, in form and substance reasonably satisfactory to you, to the
effect that:
(i) Each of this Agreement and the International Underwriting
Agreement has been duly authorized, executed and delivered by the
Company;
(ii) The Firm Shares have been duly authorized and are validly
issued, fully paid and non-assessable;
(iii) The issue and sale of the Optional Shares being sold by the
Company and the performance by the Company of its obligations under this
Agreement and the International Underwriting Agreement and the
consummation of the transactions herein and therein contemplated will
not (a) conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage,
deed of trust or loan agreement set forth on a schedule previously
furnished to the Underwriters
18
(such counsel may assume compliance with the financial covenants
contained therein) or the Stock Purchase Agreement or the Registration
Rights Agreement, (b) result in any violation of the provisions of the
Restated Certificate of Incorporation or the By-Laws of the Company or
(c) violate the federal securities laws or regulations, the Delaware
General Corporation Law or any law, statute, order, rule or regulation
known to such counsel (without independent investigation) of any court
or governmental agency or body of the State of New York having
jurisdiction over the Company, any Significant Subsidiary or any of
their respective properties, except, in the case of clauses (a) and (c),
for conflicts, breaches, defaults or violations which would not have a
material adverse effect on the financial condition, results of
operations, assets or business of the Company and its subsidiaries taken
as a whole;
(iv) No consent, approval, authorization, order, registration or
qualification of or with any State of New York or Delaware or U.S.
Federal court or governmental agency or body is required for the issue
and sale of the Optional Shares to be sold by the Company or the
consummation by the Company of the transactions contemplated by this
Agreement and the International Underwriting Agreement, except such as
have been obtained and except for the registration under the Act of the
Shares, and such consents, approvals, authorizations, registrations or
qualifications as may be required under state or foreign securities or
Blue Sky laws in connection with the purchase and distribution of the
Shares by the Underwriters and the International Underwriters;
(v) The unissued Optional Shares that may be issued and sold by
the Company to the Underwriters hereunder and under the International
Underwriting Agreement have been duly and validly authorized and, when
issued and delivered against payment therefor as provided herein, will
be duly and validly issued and fully paid and non-assessable and will
conform as to legal matters in all material respects to the description
of the Stock contained in the Prospectus;
(vi) The statements set forth in the Prospectus under the caption
"Description of Capital Stock--Common Stock", insofar as they purport to
constitute a summary of the terms of the Stock, and under the caption
"Certain United States Tax Consequences to Non-United States Holders",
insofar as they purport to summarize the laws and documents referred to
therein, are accurate in all material respects; and
19
(vii) (A) each document incorporated by reference in the
Registration Statement and the Prospectus (except for the financial
statements and related schedules and notes or other financial data
included or incorporated by reference therein as to which such counsel
need express no opinion) complied as to form, in all material respects,
as amended as of the time the Registration Statement became effective,
with the Exchange Act; and (B) the Registration Statement and the
Prospectus as amended or supplemented (except for the financial
statements and related schedules and notes or other financial data
included or incorporated by reference therein as to which such counsel
need express no opinion) comply as to form in all material respects with
the requirements of the Act.
In rendering such opinions, such counsel may rely (A) upon the opinion
furnished to the Underwriters pursuant to Section 7(d); (B) upon oral advice of
the staff of the Commission; and (C) as to matters of fact, to the extent such
counsel deems proper, on certificates of responsible officers of the Company and
certificates or other written statements of officials of jurisdictions having
custody of documents respecting the corporate existence or good standing of the
Company.
With respect to the matters to be covered in paragraph (vii) above
counsel may state their opinion is based upon their participation in the
preparation of the Registration Statement and the Prospectus and any amendment
or supplement thereto (excluding any documents incorporated by reference
therein, in which case such opinion is based upon their review of such
documents) and discussions with representatives of the Company and its auditors
(including discussions in which the Underwriters and their counsel participated)
in connection with such preparation of the Registration Statement and Prospectus
and any amendments or supplements thereto (excluding any documents incorporated
by reference therein) but is without independent check or verification except as
specified. Such counsel shall state that in the course of such participation,
review and discussions no facts have come to such counsel's attention which lead
such counsel to believe that (except for the financial statements and related
schedules and notes or other financial data included or incorporated by
reference therein as to which such counsel need express no belief) the
Registration Statement and the prospectus included therein at the time the
Registration Statement became effective contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading, and that the
Prospectus as amended or supplemented, if applicable, contains any untrue
statement of a material fact or omits to state a material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading. Such counsel may further state that such
counsel have not verified, and are not passing upon and do not
20
assume any responsibility for, the accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectus (including
any documents incorporated by reference therein) (other than those statements
referred to in paragraph (vi) above).
In rendering such opinion, such counsel may state that they express no
opinion other than as to the laws of the State of New York, the General
Corporation Law of the State of Delaware and the federal laws of the United
States;
(d) Xxxxxxxx X. XxXxxxxxx, Chief Legal Officer and Assistant Secretary
of the Company, shall have furnished to the Underwriters and the Selling
Stockholders her written opinion, dated the First Time of Delivery, in form and
substance reasonably satisfactory to you, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus;
(ii) 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 properties, or
conducts any business, so as to require such qualification, other than
where the failure to be so qualified or in good standing would not have
a material adverse effect on the Company and its subsidiaries taken as a
whole;
(iii) Each Significant Subsidiary has been duly incorporated and
is validly existing as a corporation under the laws of its jurisdiction
of incorporation, with power and authority (corporate and other) to own
its properties and conduct its business as described in the Prospectus,
and 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 properties, or conducts any
business, so as to require such qualification, other than where the
failure to be so qualified or in good standing would not have a material
adverse effect on the Company and its subsidiaries taken as a whole; and
all of the outstanding shares of capital stock of each Significant
Subsidiary have been duly authorized and validly issued, are fully paid
and non-assessable, and (except as set forth in the Prospectus) are
owned directly or indirectly by the Company, free and clear of all
material liens, encumbrances, equities or claims;
21
(iv) Other than as set forth or contemplated in the Prospectus,
such counsel does not know of any legal or governmental proceedings
pending to which the Company or any Significant Subsidiary is a party or
to which any property of the Company or any Significant Subsidiary is
the subject which are required to be described in the Prospectus as
amended or supplemented which are not described as required; and such
counsel does not know of any contracts or other documents of a character
required to be filed as an exhibit to the Registration Statement or
required to be described in the Registration Statement or the Prospectus
which are not filed or described as required; and
(v) The statements in the Prospectus incorporated by reference
from Item 3 of Part I of the Company's Annual Report on Form 10-K for
the year ended February 3, 1996, as modified or amended by any
subsequent documents incorporated by reference in the Registration
Statement or the Prospectus, insofar as such statements constitute a
summary of the legal matters, documents or proceedings referred to
therein, fairly present the information called for with respect to such
legal matters, documents or proceedings; and
(vi) The Company has an authorized capitalization as set forth in
the Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued, and are fully
paid and non-assessable.
(e) Debevoise & Xxxxxxxx, counsel for the Selling Stockholders, as
indicated in Schedule II hereto, shall have furnished to you their written
opinion with respect to each of the Selling Stockholders for whom they are
acting as counsel, dated the First Time of Delivery, in form and substance
reasonably satisfactory to you, to the effect that:
(i) The Stock Purchase Agreement, the Registration Rights
Agreement, and a Power of Attorney and Custody Agreement have been duly
executed and delivered by such Selling Stockholder and constitute valid
and binding agreements of such Selling Stockholder;
(ii) This Agreement and the International Underwriting Agreement
have been duly executed and delivered by or on behalf of such Selling
Stockholder; and the sale of the Firm Shares to be sold by such Selling
Stockholder hereunder and thereunder and the compliance by such Selling
Stockholder with all of the provisions of this Agreement, the
International Underwriting Agreement, the Stock Purchase Agreement, the
Registration
22
Rights Agreement and the Power of Attorney and Custody Agreement and the
consummation of the transactions herein and therein contemplated will
not conflict with or result in a breach or violation of any terms or
provisions of, or constitute a default under, any statute, indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument
known to such counsel to which such Selling Stockholder is a party or by
which such Selling Stockholder is bound, or to which any of the property
or assets of such Selling Stockholder is subject, nor will such action
result in any violation of the provisions of the Certificate of
Incorporation or By-laws of such Selling Stockholder if such Selling
Stockholder is a corporation, the Declaration of Trust or other
constituent documents if such Selling Stockholder is a trust, foundation
or institute, the Partnership Agreement of such Selling Stockholder if
such Selling Stockholder is a partnership, or any order, rule or
regulation known to such counsel of any court or governmental agency or
body having jurisdiction over such Selling Stockholder or the property
of such Selling Stockholder, where the consequences of such conflict,
breach, violation or default would impair the ability of the Selling
Stockholder to sell such Selling Stockholder's Firm Shares to the
Underwriters and the International Underwriters pursuant to this
Agreement and the International Underwriting Agreement or materially
impair the ability of the Selling Stockholder to perform such Selling
Stockholder's other obligations under this Agreement and the
International Underwriting Agreement, except that such counsel shall not
express any opinion as to the compliance with the registration or filing
requirements or disclosure provisions of the securities laws of the
United States or the securities or Blue Sky laws of any other
jurisdiction, such counsel shall not express any opinion as to the
enforceability of the indemnification or contribution provisions of
Section 8 of this Agreement and the International Underwriting Agreement
and such counsel shall not express any opinion as to the accuracy or
completeness of the Registration Statement or Prospectus;
(iii) No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body is
required for the consummation by the Selling Stockholders of the
transactions contemplated by this Agreement and the International
Underwriting Agreement in connection with the Firm Shares to be sold by
such Selling Stockholder hereunder or thereunder, except such as have
been duly obtained and are in full force and effect, the registration of
the Shares under the Act and such as may be required under state or
foreign securities or Blue Sky laws in connection with the purchase and
distribution of such Shares by the several Underwriters and
International Underwriters;
23
(iv) Such Selling Stockholder has full right, power and authority
to sell, assign, transfer and deliver the Firm Shares to be sold by such
Selling Stockholder under this Agreement and the International
Underwriting Agreement; and
(v) Upon delivery to the Underwriters by such Selling Stockholder
of a certificate or certificates for the Firm Shares to be sold by such
Selling Stockholder against receipt of the purchase price therefor as
provided in this Agreement and the International Underwriting Agreement,
such Selling Stockholder will transfer to the Underwriters who have
purchased such Firm Shares pursuant to this Agreement and the
International Underwriting Agreement valid title to such Firm Shares,
free and clear of any securities interests, claims, liens, equities or
other encumbrances whatsoever (assuming that the Underwriters are
without notice of any adverse claim, as defined in the Code, and are
purchasers for value in good faith for purposes of the Code, and that
such Underwriters' and International Underwriters' rights are not
limited by subsection (4) of Section 8-302 of the Code).
In rendering such opinion, such counsel may state that they
express no
opinion as to the laws of any jurisdiction other than the laws of the
State of New York and the Federal laws of the United States and in
rendering its opinion such counsel may rely upon a certificate of such
Selling Stockholder,
in respect of matters of fact as to ownership of, and liens,
encumbrances, equities or claims on the Firm Shares sold by such Selling
Stockholder; provided that such counsel shall state that they believe
that both you and they are justified in relying upon such certificate.
(f) On the date of the Prospectus at a time prior to the execution of
this Agreement, at 9:30 a.m., New York City time, on the effective date of any
post-effective amendment to the Registration Statement filed subsequent to the
date of this Agreement and also at each Time of Delivery, Ernst & Young LLP
shall have furnished to you a letter or letters, dated the respective dates of
delivery thereof, in form and substance reasonably satisfactory to you, to the
effect set forth in Annex I hereto;
(g) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date, there shall not have occurred any downgrading, nor
shall any notice have been given of any intended or potential downgrading or
other negative review in the rating accorded any securities of the Company by
any of Standard & Poor's Rating Service, Xxxxx'x Investors Service, Inc., Duff &
Xxxxxx Inc. or Fitch Investors Service, Inc.;
24
(h) Since the respective dates as of which information is given in the
Prospectus there shall not have been any material adverse change in the
business, business prospects, financial position, shareholders' equity or
results of operations of the Company and its subsidiaries, taken as a whole,
otherwise than as set forth or contemplated in the Prospectus, the effect of
which in the judgment of the Representatives makes it impracticable or
inadvisable to proceed with the public offering or the delivery of the Shares on
the terms and in the manner contemplated in the Prospectus;
(i) On or after the date hereof there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in securities
generally on the Exchange; (ii) a suspension or material limitation in trading
in the Company's securities on the Exchange; (iii) a general moratorium on
commercial banking activities declared by either Federal or New York State
authorities; or (iv) the outbreak or escalation of hostilities involving the
United States or the declaration by the United States of a national emergency or
war, if the effect of any such event specified in this clause (iv) in the
judgment of the Representatives makes it impracticable or inadvisable to proceed
with the public offering or the delivery of the Shares being delivered at such
Time of Delivery on the terms and in the manner contemplated in the Prospectus;
(j) As of the First Time of Delivery, the Firm Shares to be sold by the
Selling Stockholders shall have been duly listed on the Exchange; and as of the
Second Time of Delivery, the Optional Shares to be sold by the Company shall
have been duly listed, subject to notice of issuance, on the Exchange;
(k) The Company and the Selling Stockholders shall have furnished or
caused to be furnished to you at such Time of Delivery certificates of the
Company (signed by an executive officer) and of the Selling Stockholders,
respectively, reasonably satisfactory to you as to the accuracy of the
representations and warranties of the Company and the Selling Stockholders,
respectively, herein at and as of such Time of Delivery, as to the performance
in all material respects by the Company and the Selling Stockholders of all of
their respective obligations hereunder to be performed at or prior to such Time
of Delivery, and the Company shall have furnished or caused to be furnished
certificates as to the matters set forth in subsections (a), (g) and (h) of this
Section.
8. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based
25
upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or any amendment or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
and will reimburse each Underwriter for any legal or other expenses reasonably
incurred by such Underwriter in connection with investigating or defending any
such action or claim as such expenses are incurred; provided, however, that the
Company shall not be liable (i) in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
any Preliminary Prospectus, the Registration Statement or the Prospectus or any
such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through Xxxxxxx, Xxxxx &
Co. expressly for use therein and (ii) with respect to any Preliminary
Prospectus to the extent that any such loss, claim, damage or liability of such
Underwriter results solely from the fact that such Underwriter sold Shares to a
person as to whom the Company shall establish that there was not sent by
commercially reasonable means, at or prior to the written confirmation of such
sale, a copy of the Prospectus in any case where such delivery is required by
the Act, if the Company has previously furnished copies thereof in sufficient
quantity to such Underwriter and the loss, claim, damage or liability of such
Underwriter results from an untrue statement or omission of a material fact
contained in the Preliminary Prospectus that was corrected in the Prospectus.
(b) Each of the Selling Stockholders will indemnify and hold harmless
each Underwriter against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (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 Preliminary Prospectus, the
Registration Statement or the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein 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 any Preliminary Prospectus, the Registration
Statement or the Prospectus or any such amendment or supplement in reliance upon
and in conformity with written information furnished to the Company by such
Selling Stockholder expressly for use therein; and will reimburse each
Underwriter for any legal or other expenses reasonably incurred by such
Underwriter in connection with investigating or defending any such action or
claim as such expenses are incurred; provided, however, that such Selling
Stockholder shall not be
26
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary Prospectus,
the Registration Statement or the Prospectus or any such amendment or supplement
in reliance upon and in conformity with written information furnished to the
Company by any Underwriter through Xxxxxxx, Sachs & Co. expressly for use
therein; provided further that the liability of a Selling Stockholder shall not
exceed the product of the number of Firm Shares sold by such Selling Stockholder
and the initial public offering price of the Shares as set forth in the
Prospectus.
(c) Each Underwriter will indemnify and hold harmless the Company and
each Selling Stockholder against any losses, claims, damages or liabilities to
which the Company or such Selling Stockholder may become subject, under the Act
or otherwise, insofar as such losses, claims, damages or liabilities (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 Preliminary
Prospectus, the Registration Statement or the Prospectus, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein 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 any Preliminary
Prospectus, the Registration Statement or the Prospectus or any such amendment
or supplement in reliance upon and in conformity with written information
furnished to the Company by such Underwriter through Xxxxxxx, Xxxxx & Co.
expressly for use therein; and will reimburse the Company and each Selling
Stockholder for any legal or other expenses reasonably incurred by the Company
or such Selling Stockholder in connection with investigating or defending any
such action or claim as such expenses are incurred.
(d) Promptly after receipt by an indemnified party under subsection (a),
(b) or (c) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against an 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
otherwise than under such subsection. 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 (which shall not,
except with the consent of the indemnified party (which shall not be
unreasonably withheld),
27
be counsel to the indemnifying 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 expenses of other counsel or any other
expenses, in each case subsequently incurred by such indemnified party, in
connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall, without the written consent of the
indemnified party, effect the settlement or compromise of, or consent to the
entry of any judgment with respect to, any pending or threatened action or claim
in respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified party is an actual or potential party to such
action or claim) unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability arising out of
such action or claim and (ii) does not include a statement as to or an admission
of fault, culpability or a failure to act, by or on behalf of any indemnified
party.
(e) If the indemnification provided for in this Section 8 is unavailable
to or insufficient (other than as a result of the application of the provisos
contained therein) to hold harmless an indemnified party under subsection (a),
(b) or (c) above in respect of any losses, claims, damages or liabilities (or
actions in respect thereof) referred to therein, then each indemnifying party
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 the relative benefits
received by the Company and the Selling Stockholders on the one hand and the
Underwriters on the other from the offering of the Shares. If, however, the
allocation provided by the immediately preceding sentence is not permitted by
applicable law or if the indemnified party failed to give the notice required
under subsection (d) above, then each indemnifying party shall contribute to
such amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Company and the Selling Stockholders on the one hand and the
Underwriters on the other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities (or actions in respect
thereof), as well as any other relevant equitable considerations. The relative
benefits received by the Company and the Selling Stockholders on the one hand
and the Underwriters on the other shall be deemed to be in the same proportion
as the total net proceeds from the offering of the Shares purchased under this
Agreement (before deducting expenses) received by the Company and the Selling
Stockholders bear to the total underwriting discounts and commissions received
by the Underwriters with respect to the Shares purchased under this Agreement,
in each case as set forth in the table on the cover page of the Prospectus. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied
28
by the Company or the Selling Stockholders on the one hand or the Underwriters
on the other and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The Company,
each of the Selling Stockholders and the Underwriters agree that it would not be
just and equitable if contributions pursuant to this subsection (e) were
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above in this
subsection (e). The amount paid or payable by an indemnified party as a result
of the losses, claims, damages or liabilities (or actions in respect thereof)
referred to above in this subsection (e) shall be deemed to include any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (e), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the Shares underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages which such Underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations in this subsection (e) to
contribute are several in proportion to their respective underwriting
obligations and not joint.
(f) The obligations of the Company and the Selling Stockholders under
this Section 8 shall be in addition to any liability which the Company and the
respective Selling Stockholders may otherwise have and shall extend, upon the
same terms and conditions, to each person, if any, who controls any Underwriter
within the meaning of the Act; and the obligations of the Underwriters under
this Section 8 shall be in addition to any liability which the respective
Underwriters may otherwise have and shall extend, upon the same terms and
conditions, to each officer and director of the Company and to each person, if
any, who controls the Company or any Selling Stockholder within the meaning of
the Act.
9. (a) If any Underwriter shall default in its obligation to purchase
the Shares which it has agreed to purchase hereunder at a Time of Delivery, you
may in your discretion arrange for you or another party or other parties to
purchase such Shares on the terms contained herein. If within thirty-six hours
after such default by any Underwriter you do not arrange for the purchase of
such Shares, then the Company and the Selling Stockholders shall be entitled to
a further period of thirty-six hours within which to procure another party or
other parties satisfactory to you to purchase such Shares on such terms. In the
event that, within the respective prescribed periods, you notify the Company and
the Selling Stockholders that you
29
have so arranged for the purchase of such Shares, or the Company and the Selling
Stockholders notify you that they have so arranged for the purchase of such
Shares, you or the Company and the Selling Stockholders shall have the right to
postpone such Time of Delivery for a period of not more than seven days, in
order to effect whatever changes may thereby be made necessary in the
Registration Statement or the Prospectus, or in any other documents or
arrangements, and the Company agrees to file promptly any amendments to the
Registration Statement or the Prospectus which in your opinion may thereby be
made necessary. The term "Underwriter" as used in this Agreement shall include
any person substituted under this Section with like effect as if such person had
originally been a party to this Agreement with respect to such Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company or the
Selling Stockholders as provided in subsection (a) above, the aggregate number
of such Shares which remains unpurchased does not exceed one-eleventh of the
aggregate number of all of the Shares to be purchased at such Time of Delivery,
then the Company and the Selling Stockholders shall have the right to require
each non-defaulting Underwriter to purchase the number of Shares which such
Underwriter agreed to purchase hereunder at such Time of Delivery and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the number of Shares which such Underwriter agreed to purchase
hereunder) of the Shares of such defaulting Underwriter or Underwriters for
which such arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company and
the Selling Stockholders as provided in subsection (a) above, the aggregate
number of such Shares which remains unpurchased exceeds one-eleventh of the
aggregate number of all of the Shares to be purchased at such Time of Delivery,
or if the Company and the Selling Stockholders shall not exercise the right
described in subsection (b) above to require non-defaulting Underwriters to
purchase Shares of a defaulting Underwriter or Underwriters, then this Agreement
(or, with respect to the Second Time of Delivery, the obligations of the
Underwriters to purchase and of the Company to sell the Optional Shares) shall
thereupon terminate, without liability on the part of any non-defaulting
Underwriter or the Company or the Selling Stockholders, except for the expenses
to be borne by the Company and the Selling Stockholders and the Underwriters as
provided in Section 6 hereof and the indemnity and contribution agreements in
Section 8 hereof; but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
30
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company, the Selling Stockholders and the several
Underwriters, 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 any Underwriter or any controlling person of any
Underwriter, or the Company, or any of the Selling Stockholders, or any officer
or director or controlling person of the Company, or any controlling person of
any Selling Stockholder, and shall survive delivery of and payment for the
Shares.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
neither the Company nor the Selling Stockholders shall then be under any
liability to any Underwriter except as provided in Sections 6 and 8 hereof; but,
if for any other reason any Shares are not delivered by or on behalf of the
Company or the Selling Stockholders as provided herein, the Company will
reimburse the Underwriters through you for all out-of-pocket expenses approved
in writing by you, including fees and disbursements of counsel, reasonably
incurred by the Underwriters in making preparations for the purchase, sale and
delivery of the Shares not so delivered, but the Company and the Selling
Stockholders shall then be under no further liability to any Underwriter in
respect of the Shares not so delivered except as provided in Sections 6 and 8
hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by you jointly or by Xxxxxxx, Sachs & Co. on behalf of you as the
representatives; and in all dealings with any Selling Stockholder hereunder, you
and the Company shall be entitled to act and rely upon any statement, request,
notice or agreement on behalf of such Selling Stockholder made or given by any
or all of the Attorneys-in-Fact for such Selling Stockholder.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to you as the representatives in care of Xxxxxxx, Xxxxx &
Co., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Registration
Department; if to any Selling Stockholder shall be delivered or sent by mail,
telex or facsimile transmission to counsel for such Selling Stockholder at its
address set forth in Schedule II hereto; and if to the Company shall be
delivered or sent by mail, telex or facsimile transmission to the address of the
Company set forth in the Registration Statement, Attention: Chief Legal Officer;
provided, however, that any notice to an Underwriter pursuant to Section 8(c)
hereof shall be delivered or sent by mail, telex or facsimile transmission to
such Underwriter at its address set forth in its Underwriters' Questionnaire, or
telex constituting such Questionnaire, which address will be
31
supplied to the Company or the Selling Stockholders by you upon request. Any
such statements, requests, notices or agreements shall take effect upon receipt
thereof.
13. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, the Company and the Selling Stockholders and, to
the extent provided in Sections 8 and 10 hereof, the officers and directors of
the Company and each person who controls the Company, any Selling Stockholder or
any Underwriter, and their respective heirs, executors, administrators,
successors and assigns, and no other person shall acquire or have any right
under or by virtue of this Agreement. No purchaser of any of the Shares from any
Underwriter shall be deemed a successor or assign by reason merely of such
purchase.
14. Time shall be of the essence of this Agreement. As used herein,
the term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York.
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.
If the foregoing is in accordance with your understanding, please sign
and return to us counterparts hereof, one for the Company and one for each of
the Representatives plus one for each counsel and the Custodian, and upon the
acceptance hereof by you, on behalf of each of the Underwriters, this letter and
such acceptance hereof shall constitute a binding agreement among each of the
Underwriters, the Company and each of the Selling Stockholders.
32
Any person executing and delivering this Agreement as Attorney-in-Fact
for a Selling Stockholder represents by so doing that he has been duly appointed
as Attorney-in-Fact by such Selling Stockholder pursuant to a validly existing
and binding Power of Attorney and Custody Agreement which authorizes such
Attorney-in-Fact to take such action.
Very truly yours,
AMERICAN STORES COMPANY
By: ..................................
Name:
Title:
SELLING STOCKHOLDERS
By: ..................................
Name:
Title:
By: ..................................
Name:
Title:
By: ..................................
Name:
Title:
As Attorneys-in-Fact acting on behalf of
each of the Selling Stockholders named in
Schedule II to this Agreement.
33
Accepted as of the date hereof [at ....., ..............,.............:]
Xxxxxxx, Xxxxx & Co.
X.X. Xxxxxx Securities Inc.
On behalf of each of the Underwriters
By:..............................................
(Xxxxxxx, Sachs & Co.)
By: X.X. Xxxxxx Securities Inc.
By:.............................................
Name:
Title:
34
SCHEDULE I
Number of Optional
Shares to be
Total Number of Purchased if
Firm Shares Maximum Option
Underwriter to be Purchased Exercised
----------- --------------- ---------
Xxxxxxx, Sachs & Co. ...............................
X.X. Xxxxxx Securities Inc. ........................
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation
Xxxxxx Xxxxxxx & Co. Incorporated...................
Xxxxx Xxxxxx Inc. ..................................
---------- ---------
Total............................................ 12,326,330 1,848,949
========== =========
I-1
SCHEDULE II
NUMBER OF
OPTIONAL SHARES
TOTAL NUMBER TO BE SOLD IF
OF FIRM SHARES MAXIMUM OPTION
TO BE SOLD EXERCISED
---------- ---------
The Company ..................................................... 0 1,848,949
THE SELLING STOCKHOLDERS:(a)
ALSAM Trust (X.X. Xxxxxx portion) ............................... 4,583,515 0
ALSAM Trust (Xxxxx X. Xxxxxx portion) ........................... 82,735 0
Six S. Ranch, Inc. .............................................. 8,923 0
ALSAM Foundation ................................................ 913,175 0
Xxxxxx Family Foundation for Roman Catholic and Community
Charities ............................................... 301,131 0
Xxxxxx Institute for Research ................................... 869,933 0
Xxxxx Xxx Xxxxxx Xxxxxxxx ....................................... 179,584 0
Xxxxxxx Xxxxxx Xxxxxxxx ......................................... 195,165 0
The Northern Trust Company, As Trustee, UA dtd 8/30/96 with L.S .
Xxxxxx, The X.X. Xxxxxx & Xxxxx X. Xxxxxx Charitable
Remainder Unitrust #1 ................................... 41,222 0
The Northern Trust Company, As Trustee, UA dtd 1/17/97
with X.X. Xxxxxx, The X.X. Xxxxxx & Xxxxx
X. Xxxxxx Charitable Remainder Unitrust #2 .............. 3,221,871 0
The Northern Trust Company, As Trustee, UA dtd 8/26/96 with L.S .
Xxxxxx, The X.X. Xxxxxx, The Xxxxx Xxx Xxxxxxxx
Charitable Remainder Unitrust #1 ........................ 113,760 0
The Northern Trust Company, Successor Trustee, UA dtd 7/6/71
with Xxxxxxx Xxxxxx (Xxxxxxxx), The Xxxxxxx Xxxxxx
(Xxxxxxxx) Personal Trust ............................... 233,556 0
The Northern Trust Company, As Trustee, UA dtd 8/30/96 with L.S .
Xxxxxx, The Xxxxxxx Xxxxxx Xxxxxxxx Charitable Remainder
Unitrust #1 ............................................. 283,287 0
The Northern Trust Company, As Trustee, UA dtd 1/17/97 with L.S .
Xxxxxx, The Xxxxxxx Xxxxxx Xxxxxxxx Charitable Remainder
Unitrust #2 ............................................. 217,707 0
The Northern Trust Company, Successor Trustee, UA dtd 2/2/66
with Xxxxxx Xxxxxx Xxxxxxxxx, for the benefit of Xxxxxxx
Xxxxxx (Xxxxxxxx) ....................................... 21,947 0
The Northern Trust Company, Successor Trustee, UA dtd 5/21/75
with Xxxxxx Xxxxxx Xxxxxx, The Xxxxxx Xxxxxx Xxxxxx
Personal Trust .......................................... 125,122 0
The Northern Trust Company, Successor Trustee, UA dtd 8/26/96
with X.X. Xxxxxx, The Xxx X. Xxxxxx Charitable Remainder
Unitrust #1 ............................................. 283,287 0
II-1
The Northern Trust Company, As Trustee, UA dtd 1/17/97 with X.X.
Xxxxxx, The Xxx X. Xxxxxx Charitable Remainder Unitrust
#2 ....................................................... 217,707 0
The Northern Trust Company, Successor Trustee, UA dtd 2/2/66
with Xxxxxx Xxxxxx Xxxxxxxxx, For the benefit of Xxx X.
Xxxxxx ................................................... 21,946 0
The Northern Trust Company, Successor Trustee, UA dtd 2/2/66
with Xxxxxx Xxxxxx Xxxxxxxxx, For the benefit of Mar
Xxxxxxx Xxxxxx ........................................... 21,949 0
The Northern Trust Company, Successor Trustee, UA dtd 11/23/83
with Xxxxxx Xxxxxx Xxxxxxxxx, For the benefit of Xxxxxxxx
Xxxxxx, Age 30 Trust ..................................... 4,523 0
The Northern Trust Company, Successor Trustee, UA dtd 11/23/83
with Xxxxxx Xxxxxx Xxxxxxxxx, For the benefit of Xxxxxx X
Xxxxxx, Age 30 Trust ..................................... 4,523 0
The Northern Trust Company, Successor Trustee, UA dtd 11/23/83
with Xxxxxx Xxxxxx Xxxxxxxxx, For the benefit of
Xxxxxxxx Xxxxxxxx, Age 30 Trust .......................... 4,523 0
The Northern Trust Company, Successor Trustee, UA dtd 11/23/83
with Xxxxxx Xxxxxx Xxxxxxxxx, For the benefit of Xxxxxx
Xxxxxx Xxxxxxx, Age 30 Trust ............................. 4,524 0
The Northern Trust Company, Successor Trustee, UA dtd
11/23/83 with Xxxxxx Xxxxxx Xxxxxxxxx, For the benefit
of Xxxxx Xxxxx Xxxxxx, Age 30 Trust ...................... 4,524 0
The Northern Trust Company, Successor Trustee, UA dtd 11/23/83
with Xxxxxx Xxxxxx Xxxxxxxxx, For the benefit of
Xxxxxxx X. Xxxxxx, Age 30 Trust .......................... 4,524 0
The Northern Trust Company, Successor Trustee, UA dtd 11/23/83
with Xxxxxx Xxxxxx Xxxxxxxxx, For the benefit of Xxx
Xxxxx Xxxxxx, Age 30 Trust ............................... 4,524 0
The Northern Trust Company, Trustee, UA dtd 1/29/97 with Xxxxx
Xxx Xxxxxxxx, The Xxxxx Xxx Xxxxxx Xxxxxxxx Charitable
Remainder Trust #2 ....................................... 44,612 0
U.S. Bank, Successor Trustee, UA dtd 9/13/68 With Xxxxx Xxx
Xxxxxx (Balukoff) The Xxxxx Xxx Xxxxxx (Xxxxxxxx)
Personal Trust ........................................... 119,510 0
U.S. Bank, Successor Trustee, UA dtd 2/2/66 With Xxxxxx Xxxxxx
Xxxxxxxxx for the benefit of Xxxxx Xxx Xxxxxx (Xxxxxxxx).. 21,948 0
U.S. Bank, Successor Trustee, UA dtd 11/23/83 with Xxxxxx Xxxxxx
Xxxxxxxxx for the benefit of Xxxxx X. Xxxxxxx Lifetime
Trust .................................................... 4,618 0
U.S. Bank, As Successor Trustee, UA dtd 11/23/83 With Xxxxxx
Xxxxxx Xxxxxxxxx for the benefit of Xxxxx Xxxx Xxxxxxx,
Age 30 Trust ............................................. 4,524 0
II-2
U.S. Bank, Successor Trustee, UA dtd 11/23/83 With Xxxxxx Xxxxxx
Xxxxxxxxx for the benefit of Xxxxxxx Xxx Xxxxxxx,
Lifetime Trust .......................................... 4,618 0
U.S. Bank, As Successor Trustee, UA dtd 11/23/83 With Xxxxxx
Xxxxxx Xxxxxxxxx for the benefit of Xxxxxxx Xxx
Xxxxxxx, Age 30 Trust ................................... 4,524 0
U.S. Bank, Successor Trustee, UA dtd 11/23/83 With Xxxxxx Xxxxxx
Xxxxxxxxx for the benefit of Xxxxxx Xxx Xxxxxxxx
Lifetime Trust .......................................... 4,618 0
U.S. Bank, As Successor Trustee, UA dtd 11/23/83 With Xxxxxx
Xxxxxx Xxxxxxxxx for the benefit of Xxxxxx Xxx
Xxxxxxxx, Age 30 Trust .................................. 4,524 0
U.S. Bank, Successor Trustee, UA dtd 11/23/83 With Xxxxxx Xxxxxx
Xxxxxxxxx for the benefit of Xxxxxxx Xxxxxxxx Lifetime
Trust ................................................... 4,618 0
U.S. Bank, As Successor Trustee, UA dtd 11/23/83 With Xxxxxx
Xxxxxx Xxxxxxxxx for the benefit of Xxxxxxx Xxxxxxxx,
Age 30 Trust ............................................ 4,318 0
U.S. Bank, Successor Trustee, UA dtd 11/23/83 With Xxxxxx Xxxxxx
Xxxxxxxxx for the benefit of Xxxxxx Xxxxxxxx, Xx.
Lifetime Trust .......................................... 4,619 0
U.S. Bank, As Successor Trustee, UA dtd 11/23/83 With Xxxxxx
Xxxxxx Xxxxxxxxx for the benefit of Xxxxxxx Xxxxxx
Xxxxxxxx, Xx., Age 30 Trust ............................. 4,524 0
U.S. Bank, Successor Trustee, UA dtd 11/23/83 With Xxxxxx Xxxxxx
Xxxxxxxxx for the benefit of Xxxxxxx X. Xxxxxxxx
Lifetime Trust .......................................... 4,618 0
U.S. Bank, As Successor Trustee, UA dtd 11/23/83 With Xxxxxx
Xxxxxx Xxxxxxxxx for the benefit of Xxxxxxx Xxxxxx
Xxxxxxxx, Age 30 Trust .................................. 4,523 0
U.S. Bank, Successor Trustee, UA dtd 11/23/83 With Xxxxxx Xxxxxx
Xxxxxxxxx for the benefit of Xxxxx Xxxxx Xxxxxxxx
Lifetime Trust .......................................... 4,617 0
U.S. Bank, As Successor Trustee, UA dtd 11/23/83 With Xxxxxx
Xxxxxx Xxxxxxxxx for the benefit of Xxxxx Xxxxx
Xxxxxxxx, Age 30 Trust .................................. 4,523 0
U.S. Bank, Successor Trustee, UA dtd 11/23/83 With Xxxxxx Xxxxxx
Xxxxxxxxx for the benefit of Xxx Xxxxxxxx Lifetime
Trust ................................................... 4,618 0
U.S. Bank, As Successor Trustee, UA dtd 11/23/83 With Xxxxxx
Xxxxxx Xxxxxxxxx for the benefit of Xxx Xxxxxxxx, Age 30
Trust ................................................... 4,524 0
U.S. Bank, As Trustee, UA dtd 2/13/97 with Xxxxx Xxx Xxxxxx
Balukoff, the Balukoff Charitable Remainder Trust ....... 98,145 0
---------- ---------
TOTAL.................................................. 12,326,330 1,848,949
========== =========
II-3
(a) Each Selling Stockholder is represented by Debevoise & Xxxxxxxx and has
appointed X.X. Xxxxxx, Xxxxxx X. Xxxxxxx and Xxxxxx X. Xxxxxxx, and each of
them, as the attorneys-in-fact for such Selling Stockholder.
II-4
ANNEX I
Pursuant to Section 7(f) of the Underwriting Agreement, the
accountants shall furnish letters to the Underwriters substantially to the
effect that:
(i) They are independent certified public accountants with respect
to the Company and its subsidiaries within the meaning of the Act and
the applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules examined by them and
included or incorporated by reference in the Registration Statement or
the Prospectus comply as to form in all material respects with the
applicable accounting requirements of the Act or the Exchange Act, as
applicable, and the related published rules and regulations thereunder;
(iii) On the basis of specified procedures including inquiries of
officials of the Company who have responsibility for financial and
accounting matters regarding whether the unaudited condensed
consolidated financial statements referred to in paragraph (vi)(A)(i)
below comply as to form in all material respects with the applicable
accounting requirements of the Act and the Exchange Act and the related
published rules and regulations, nothing came to their attention that
caused them to believe that the unaudited condensed consolidated
financial statements do not comply as to form in all material respects
with the applicable accounting requirements of the Act and the Exchange
Act and the related published rules and regulations;
(iv) The unaudited selected financial information with respect to
the consolidated results of operations and financial position of the
Company for the five fiscal years in the period ending February 3, 1996
included in the Prospectus and included or incorporated by reference in
Item 6 of the Company's Annual Report on Form 10-K for the most recent
fiscal year agrees with the corresponding amounts (after restatement
where applicable) in the audited consolidated financial statements for
such five fiscal years which were included or incorporated by reference
in the Company's Annual Reports on Form 10-K for such fiscal years;
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K and
on the basis of limited procedures specified in such letter nothing came
to their attention as a result of the foregoing procedures that caused
them to believe that this information does not conform in all material
respects with the disclosure requirements of Items 301, 302, 402 and
503(d), respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company and its subsidiaries, inspection of
the minute books of the Company and its subsidiaries since the date of
the latest audited financial statements included or incorporated by
reference in the Prospectus, inquiries of officials of the Company and
its subsidiaries responsible for financial and accounting matters and
such other inquiries and procedures as may be specified in such letter,
nothing came to their attention that caused them to believe that:
(A) (i) the unaudited condensed consolidated statements of
income, consolidated balance sheets and consolidated statements of
cash flows included in the Prospectus and/or included or
incorporated by reference in the Company's Quarterly Reports on
Form 10-Q incorporated by reference in the Prospectus do not comply
as to form in all material respects with the applicable accounting
requirements of the Exchange Act and the related published rules
and regulations, or (ii) any material modifications should be made
to the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash
flows included in the Prospectus or included in the Company's
Quarterly Reports on Form 10-Q incorporated by reference in the
Prospectus, for them to be in conformity with generally accepted
accounting principles;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the
corresponding items in the unaudited consolidated financial
statements from which such data and items were derived, and any
such unaudited data and items were not determined on a basis
substantially consistent with the basis for the corresponding
amounts in the audited consolidated financial statements included
or incorporated by reference in the Company's Annual Report on Form
10-K for the most recent fiscal year;
(C) the unaudited financial statements which were not included
in the Prospectus but from which were derived the unaudited
condensed financial statements referred to in Clause (A) and any
unaudited income statement data and balance sheet items included in
the Prospectus and referred to in Clause (B) were not determined on
a basis substantially consistent with the basis for the audited
financial statements included or incorporated by reference in the
Company's Annual Report on Form 10-K for the most recent fiscal
year;
(D) as of a specified date not more than five days prior to the
date of such letter, there have been any changes in the
consolidated capital stock (other than issuances of capital stock
upon exercise of options and stock appreciation rights, upon
earn-outs of performance shares and upon conversions of convertible
securities, in each case which were outstanding on the date of the
latest balance sheet included
or incorporated by reference in the Prospectus) or any increase in
the consolidated long-term debt of the Company and its
subsidiaries, or any decreases in consolidated shareholders' equity
other than decreases resulting from repurchases by the Company of
shares of Stock in a total amount not exceeding $5,000,000 or
dividends declared or other items specified by the Representatives,
or any increases in any items specified by the Representatives, in
each case as compared with amounts shown in the latest balance
sheet included or incorporated by reference in the Prospectus,
except in each case for changes, increases or decreases which the
Prospectus discloses have occurred or may occur or which are
described in such letter; and
(E) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus
to a specified date there were any decreases in consolidated sales,
comparable store sales, or other items specified by the
Representatives, or any increases in any items specified by the
Representatives, in each case as compared with the comparable
period of the preceding year and with any other period of
corresponding length specified by the Representatives, except in
each case for increases or decreases which the Prospectus discloses
have occurred or may occur or which are described in such letter;
and
(vii) In addition to the examination referred to in their report(s)
included or incorporated by reference in the Prospectus and the limited
procedures, inspection of minute books, inquiries and other procedures
referred to in paragraphs (iii) and (vi) above, they have carried out
certain specified procedures, not constituting an examination in
accordance with generally accepted auditing standards, with respect to
certain amounts, percentages and financial information specified by the
Representatives which are derived from the general accounting records of
the Company and its subsidiaries, which appear in the Prospectus
(excluding documents incorporated by reference) or in Part II of, or in
exhibits and schedules to, the Registration Statement specified by the
Representatives or in documents incorporated by reference in the
Prospectus specified by the Representatives, and have compared certain
of such amounts, percentages and financial information with the
accounting records of the Company and its subsidiaries or other
Company-prepared records or recalculated from other data in the
Prospectus, and have found them to be in agreement.
