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Exhibit (h)
BLACKRIDGE INVESTMENT CORP.
(a Maryland corporation)
__ Shares of Common Stock
PURCHASE AGREEMENT
Dated: , 2004
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BLACKRIDGE INVESTMENT CORP.
(a Maryland corporation)
__ Shares of Common Stock
(Par Value $0.001 Per Share)
PURCHASE AGREEMENT
, 2004
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Citigroup Global Markets Inc.
UBS Securities LLC
as Representatives of the several Underwriters
x/x Xxxxxxx Xxxxx & Xx.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Blackridge Investment Corp., a Maryland corporation (the "Company"),
confirms its agreement with Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx &
Xxxxx Incorporated ("Xxxxxxx Xxxxx") and each of the other Underwriters named in
Schedule A hereto (collectively, the "Underwriters", which term shall also
include any underwriter substituted as hereinafter provided in Section 10
hereof), for whom Xxxxxxx Xxxxx, Citigroup Global Markets Inc. and UBS
Securities LLC are acting as representatives (in such capacity, the
"Representatives"), with respect to the issue and sale by the Company and the
purchase by the Underwriters, acting severally and not jointly, of the
respective numbers of shares of Common Stock, par value $0.001 per share, of the
Company ("Common Stock") set forth in said Schedule A, and with respect to the
grant by the Company to the Underwriters, acting severally and not jointly, of
the option described in Section 2(b) hereof to purchase all or any part of _____
additional shares of Common Stock to cover over allotments, if any. The
aforesaid ______ shares of Common Stock (the "Initial Securities") to be
purchased by the Underwriters and all or any part of the _____ shares of Common
Stock subject to the option described in Section 2(b) hereof (the "Option
Securities") are hereinafter called, collectively, the "Securities".
The Company understands that the Underwriters propose to make a public
offering of the Securities as soon as the Representatives deem advisable after
this Agreement has been executed and delivered.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form N-2 (File No. 333-114462),
including the related preliminary prospectus or prospectuses, covering the
registration of the Securities under the Securities Act of 1933, as amended (the
"1933 Act"). Promptly after execution and delivery of this Agreement, the
Company will prepare and file a prospectus in accordance with the provisions of
Rule 430A ("Rule 430A") of the rules and regulations of the Commission under the
1933 Act (the "1933 Act Regulations") and paragraph (h) of Rule 497 ("Rule
497(h)") of the 1933 Act Regulations. The information included in such
prospectus that was omitted from such registration statement at the time it
became effective but that is deemed to be part
of such registration statement at the time it became effective pursuant to
paragraph (b) of Rule 430A is referred to as "Rule 430A Information." Each
prospectus used before such registration statement became effective, and any
prospectus that omitted the Rule 430A Information, that was used after such
effectiveness and prior to the execution and delivery of this Agreement, is
herein called a "preliminary prospectus." Such registration statement, including
the exhibits and any schedules thereto, at the time it became effective, and
including the Rule 430A Information, is herein called the "Registration
Statement." Any registration statement filed pursuant to Rule 462(b) of the 1933
Act Regulations is herein referred to as the "Rule 462(b) Registration
Statement," and after such filing the term "Registration Statement" shall
include the Rule 462(b) Registration Statement. The final prospectus in the form
first furnished to the Underwriters for use in connection with the offering of
the Securities is herein called the "Prospectus." For purposes of this
Agreement, all references to the Registration Statement, any preliminary
prospectus, the Prospectus or any amendment or supplement to any of the
foregoing shall be deemed to include the copy filed with the Commission pursuant
to its Electronic Data Gathering, Analysis and Retrieval system ("XXXXX").
A Form N-54A Notification of Election to be Subject to Sections 55 through
65 of the Investment Company Act of 1940 filed pursuant to Section 54(a) of the
Investment Company Act (File No. 814-00656) (the "Notification of Election") was
filed with the Commission on April 14, 2004 under the Investment Company Act of
1940, as amended, and the rules and regulations thereunder (collectively, the
"1940 Act").
The Company has entered into an investment advisory agreement, dated as of
_____, 2004 (the "Investment Advisory Agreement"), with Blackstone Mezzanine
Advisors L.P., a Delaware limited partnership registered as an investment
adviser (the "Adviser"), under the Investment Advisers Act of 1940, as amended,
and the rules and regulations thereunder (collectively, the "Advisers Act").
The Company has entered into an administration agreement, dated as of ____,
2004 (the "Administration Agreement"), with Blackridge Administration LLC.
Prior to the Closing Time (as defined herein), the Company will issue to
the Adviser an aggregate of 600,000 shares of Common Stock (together with any
shares of Common Stock now owned by the Adviser) for an aggregate purchase price
of $15,000,000 (together with any amounts paid by the Adviser for any shares of
Common Stock now owned by the Adviser) in a private transaction (the "Blackstone
Private Placement") in reliance on an exemption from the 1933 Act.
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company. The Company and the
Adviser, jointly and severally, represent and warrant to each Underwriter as of
the date hereof, as of the Closing Time referred to in Section 2(c) hereof, and
if any Option Securities are purchased, as of each Date of Delivery referred to
in Section 2(b) hereof, and agrees with each Underwriter, as follows:
(i) Compliance with Registration Requirements. The Company is eligible
to use Form N-2. Each of the Registration Statement and any Rule 462(b)
Registration Statement and any post-effective amendment thereto has become
effective under the 1933 Act and no stop order suspending the effectiveness
of the Registration Statement, any Rule 462(b) Registration Statement or
any post-effective amendment thereto has been issued under the 1933 Act and
no proceedings for that purpose have been instituted or are pending or, to
the knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for additional information has been
complied with.
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At the respective times the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendments thereto became
effective and at the Closing Time (and, if any Option Securities are
purchased, at the Date of Delivery), the Registration Statement, the Rule
462(b) Registration Statement and any amendments and supplements thereto
complied and will comply in all material respects with the requirements of
the 1933 Act, the 1933 Act Regulations and the 1940 Act and did not 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. Neither the Prospectus nor any
amendments or supplements thereto, at the time the Prospectus or any such
amendment or supplement was issued and at the Closing Time (and, if any
Option Securities are purchased, at the Date of Delivery), included or will
include an untrue statement of a material fact or omitted or will omit 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.
The representations and warranties in this subsection shall not apply to
statements in or omissions from the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendments thereto, or the
Prospectus, or any amendments or supplements thereto, made in reliance upon
and in conformity with written information furnished to the Company by any
Underwriter through the Representatives expressly for use therein.
Each preliminary prospectus and the prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto complied when so filed in all material respects with the 1933 Act,
the 1933 Act Regulations and the 1940 Act and each preliminary prospectus
and the Prospectus delivered to the Underwriters for use in connection with
this offering was identical to the electronically transmitted copies
thereof filed with the Commission pursuant to XXXXX, except to the extent
permitted by Regulation S-T.
(ii) Independent Accountants. The accountants who certified the
statement of assets and liabilities included in the Registration Statement
are (A) independent public accountants as required by the 1933 Act, the
1933 Act Regulations and the Securities Exchange Act of 1934, as amended
(the "1934 Act"), (B) in compliance with the applicable requirements
relating to the qualification of accountants under Rule 2-01 under
Regulation S-X and (C) a registered public accounting firm as defined by
the Public Company Accounting Oversight Board ("PCAOB"), whose registration
has not been suspended or revoked and who has not requested such
registration to be withdrawn.
(iii) Financial Statements. The audited statement of assets and
liabilities included in the Registration Statement and the Prospectus,
together with the related notes, present fairly the financial position of
the Company as of the date indicated; there are no financial statements
that are required to be included in the Registration Statement or
Prospectus that are not included as required; said statement of assets and
liabilities have been prepared in conformity with generally accepted
accounting principles ("GAAP") applied, except as set forth in the notes of
the financial statements, on a consistent basis throughout the periods
involved. The financial data set forth in the Prospectus under the caption
"Capitalization" fairly presents the information set forth therein on a
basis consistent with that of the audited financial statements and related
notes thereto contained in the Registration Statement. To the Company's
knowledge after due inquiry, no person who has been suspended or barred
from being associated with a registered public accounting firm, or who has
failed to comply with any sanction pursuant to rule 5300 promulgated by the
PCAOB, has participated in or otherwise aided the preparation of or audited
the financial statements, supporting schedules or other financial data
filed with the Commission as part of the Registration Statement and
included in the Prospectus.
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(iv) No Material Adverse Change in Business. Since the respective
dates as of which information is given in the Registration Statement and
the Prospectus, except as otherwise stated therein, (A) there has been no
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company, whether or
not arising in the ordinary course of business (a "Material Adverse
Effect"), (B) there have been no transactions entered into by the Company,
other than those in the ordinary course of business, which are material
with respect to the Company, and (C) there has been no dividend or
distribution of any kind declared, paid or made by the Company on any class
of its capital stock.
(v) Good Standing of the Company. The Company has been duly organized
and is validly existing as a corporation in good standing under the laws of
the State of Maryland and has corporate power and authority to own, lease
and operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under this
Agreement, the Investment Advisory Agreement and the Administration
Agreement; and the Company is duly qualified as a foreign corporation to
transact business and is in good standing in each other jurisdiction in
which such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure so
to qualify or to be in good standing would not result in a Material Adverse
Effect.
(vi) Subsidiaries. The Company has no subsidiaries. The Company does
not own, directly or indirectly, any shares of stock or any other equity or
debt securities of any corporation or have any equity or debt interest in
any firm, partnership, joint venture, association or other entity.
(vii) Capitalization. The authorized, issued and outstanding capital
stock of the Company is as set forth in the Prospectus in the column
entitled "Actual" under the caption "Capitalization" (except for subsequent
issuances, if any, pursuant to this Agreement, pursuant to reservations,
agreements or employee benefit plans referred to in the Prospectus or
pursuant to the exercise of convertible securities or options referred to
in the Prospectus). The shares of issued and outstanding capital stock of
the Company have been duly authorized and validly issued and are fully paid
and non-assessable; none of the outstanding shares of capital stock of the
Company was issued in violation of the preemptive or other similar rights
of any securityholder of the Company.
(viii) Authorization of Agreements. Each of this Agreement, the
Investment Advisory Agreement and the Administration Agreement have been
duly authorized, executed and delivered by the Company. The Investment
Advisory Agreement and the Administration Agreement are valid and binding
obligations of the Company, enforceable against the Company in accordance
with their respective terms, except as the enforcement thereof may be
subject to (i) bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or thereafter in effect relating to creditors' rights
generally and (ii) general principles of equity and the discretion of the
court before which any proceeding therefor may be brought.
(ix) Authorization and Description of Securities. The Securities have
been duly authorized for issuance and sale to the Underwriters pursuant to
this Agreement and, when issued and delivered by the Company pursuant to
this Agreement against payment of the consideration set forth herein, will
be validly issued and fully paid and non-assessable; the Common Stock
conforms, in all material respects, to all statements relating thereto
contained in the Prospectus and such description conforms to the rights set
forth in the Company's articles of incorporation and bylaws; no holder of
the Securities will be subject to personal liability by reason of being
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such a holder; and the issuance of the Securities is not subject to the
preemptive or other similar rights of any securityholder of the Company.
(x) Absence of Defaults and Conflicts. The Company is not in violation
of its charter or by-laws or in default in the performance or observance of
any obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, deed of trust, loan or credit agreement, note, lease
or other agreement or instrument to which the Company is a party or by
which it may be bound, or to which any of the property or assets of the
Company is subject (collectively, "Agreements and Instruments") except for
such defaults that would not result in a Material Adverse Effect; and the
execution, delivery and performance of this Agreement, the Investment
Advisory Agreement and the Administration Agreement and the consummation of
the transactions contemplated herein and therein and in the Registration
Statement (including the issuance and sale of the Securities and the use of
the proceeds from the sale of the Securities as described in the Prospectus
under the caption "Use of Proceeds") and compliance by the Company with its
obligations hereunder and thereunder have been duly authorized by all
necessary corporate action and do not and will not, whether with or without
the giving of notice or passage of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined below)
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company pursuant to, the
Agreements and Instruments (except for such conflicts, breaches or defaults
or liens, charges or encumbrances that would not result in a Material
Adverse Effect), nor will such action result in any violation of the
provisions of the charter or by-laws of the Company or any applicable law,
statute, rule, regulation, judgment, order, writ or decree of any
government, government instrumentality or court, domestic or foreign,
having jurisdiction over the Company or any of its assets, properties or
operations. As used herein, a "Repayment Event" means any event or
condition which gives the holder of any note, debenture or other evidence
of indebtedness (or any person acting on such holder's behalf) the right to
require the repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company.
(xi) Absence of Proceedings. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or, to the knowledge of
the Company, threatened, against or affecting the Company, which is
required to be disclosed in the Registration Statement (other than as
disclosed therein), or which would result in a Material Adverse Effect, or
which would materially and adversely affect the properties or assets
thereof or the consummation of the transactions contemplated in this
Agreement, the Investment Advisory Agreement or the Administration
Agreement or the performance by the Company of its obligations hereunder or
thereunder; the aggregate of all pending legal or governmental proceedings
to which the Company is a party or of which any of its property or assets
is the subject which are not described in the Registration Statement,
including ordinary routine litigation incidental to the business, would not
result in a Material Adverse Effect.
(xii) Accuracy of Exhibits. There are no contracts or documents which
are required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits thereto which have not been so
described and filed as required.
(xiii) Possession of Intellectual Property. The Company owns or
possesses, or can acquire on reasonable terms, adequate patents, patent
rights, licenses, inventions, copyrights, know-how (including trade secrets
and other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures), trademarks, service marks, trade names
or other intellectual property (collectively, "Intellectual Property")
necessary to carry on the business now
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operated by it or proposed to be operated by it immediately following the
offering of the Securities as described in the Prospectus, except where the
failure to have such ownership or possession would not result in a Material
Adverse Effect, and the Company has not received any notice and is not
otherwise aware of any infringement of or conflict with asserted rights of
others with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property invalid or
inadequate to protect the interest of the Company therein, and which
infringement or conflict (if the subject of any unfavorable decision,
ruling or finding) or invalidity or inadequacy, would result in a Material
Adverse Effect.
(xiv) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
is necessary or required for the performance by the Company of its
obligations hereunder, in connection with the offering, issuance or sale of
the Securities hereunder or the consummation of the transactions
contemplated by this Agreement, the Investment Advisory Agreement or the
Administration Agreement, except (A) such as have been already obtained
under the 1933 Act, the 1933 Act Regulations or the 1940 Act, (B) such as
may be required under the 1933 Act, the 1933 Act Regulations or state
securities laws and (C) the filing of the Notification of Election under
the 1940 Act, which has been effected.
(xv) Absence of Manipulation. Neither the Company nor any affiliate of
the Company has taken, nor will the Company or any affiliate take, directly
or indirectly, any action which is designed to or which has constituted or
which would reasonably be expected to cause or result in stabilization or
manipulation of the price of the Securities.
(xvi) Possession of Licenses and Permits. The Company possesses such
permits, licenses, approvals, consents and other authorizations
(collectively, "Governmental Licenses") issued by the appropriate federal,
state, local or foreign regulatory agencies or bodies necessary to conduct
the business now operated by it or proposed to be operated by it
immediately following the offering of the Securities as described in the
Prospectus, except where the failure so to possess would not result in a
Material Adverse Effect; the Company is in compliance with the terms and
conditions of all such Governmental Licenses, except where the failure so
to comply would not result in a Material Adverse Effect; all of the
Governmental Licenses are valid and in full force and effect, except when
the invalidity of such Governmental Licenses or the failure of such
Governmental Licenses to be in full force and effect would not result in a
Material Adverse Effect; and the Company has not received any notice of
proceedings relating to the revocation or modification of any such
Governmental Licenses which, singly or in the aggregate, if the subject of
an unfavorable decision, ruling or finding, would result in a Material
Adverse Effect.
(xvii) Investment Company Act. The Company is not required, and upon
the issuance and sale of the Securities as herein contemplated and the
application of the net proceeds therefrom as described in the Prospectus
will not be required, to register as a "registered management investment
company" under the 1940 Act.
(xviii) Registration Rights. There are no persons with registration
rights or other similar rights to have any securities registered pursuant
to the Registration Statement or otherwise registered by the Company under
the 1933 Act.
(xix) Related Party Transactions. There are no business relationships
or related party transactions involving the Company or any other person
required to be described in the Prospectus which have not been described as
required.
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(xx) Notification of Election. When the Notification of Election was
filed with the Commission, it (A) contained all statements required to be
stated therein in accordance with, and complied in all material respects
with the requirements of, the 1940 Act, as applicable to business
development companies and (B) did not include any untrue statement of a
material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading.
(xxi) Investment Advisory Agreement. (A) The terms of the Investment
Advisory Agreement, including compensation terms, comply with Section 15 of
the 1940 Act and Section 205 of the Advisers Act, each as applicable to
business development companies and (B) the approvals by the board of
directors and the sole stockholder of the Company of the Investment
Advisory Agreement have been made in accordance with the requirements of
Section 15 of the 1940 Act applicable to companies that have elected to be
regulated as "business development companies" under the 1940 Act.
(xx) Interested Persons. Except as disclosed in the Registration
Statement and the Prospectus (A) no person is serving or acting as an
officer, director or investment adviser of the Company, except in
accordance with the provisions of the 1940 Act and the Advisers Act, and
the applicable published rules and regulations thereunder and (B) no
director of the Company is an "interested person" (as defined in the 0000
Xxx) of the Company or an "affiliated person" (as defined in the 0000 Xxx)
of any of the Underwriters.
(xxi) Business Development Company. (A) The Company has duly elected
to be treated by the Commission under the 1940 Act as a "business
development company", such election is effective and all required action
has been taken by the Company under the 1933 Act and the 1940 Act to make
the public offering and consummate the sale of the Securities as provided
in this Agreement; (B) the provisions of the corporate charter and by-laws
of the Company, and the investment objectives, policies and restrictions
described in the Prospectus, assuming they are implemented as described,
will comply in all material respects with the requirements of the 1940 Act;
and (C) the operations of the Company are in compliance in all material
respects with the provisions of the 1940 Act applicable to business
development companies and the rules and regulations of the Commission
thereunder.
(xxii) Employees and Executives. The Company is not aware that (A) any
executive, key employee or significant group of employees of the Company or
the Adviser plans to terminate employment with the Company or the Adviser
or (B) any such executive or key employee is subject to any noncompete,
nondisclosure, confidentiality, employment, consulting or similar
arrangement that would be violated by the present or proposed business
activities of the Company, the Adviser or Blackstone Group Holdings L.P.
(xxiii) Accounting Controls. The Company has established and maintains
a system of internal accounting controls sufficient to provide reasonable
assurances that (A) transactions are executed in accordance with
management's general or specific authorization; (B) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain
accountability for assets; (C) access to assets is permitted only in
accordance with management's general or specific authorization; (D) the
recorded accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences; (E) material information relating to the Company and the
assets managed by the Adviser is promptly made known to the officers
responsible for establishing and maintaining the system of internal
accounting controls; and (F)
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any significant deficiencies or weaknesses in the design or operation of
internal accounting controls which could adversely affect the Company's
ability to record, process, summarize and report financial data, and any
fraud whether or not material that involves management or other employees
who have a significant role in internal controls, are adequately and
promptly disclosed to the Company's independent auditors and the audit
committee of the Company's board of directors.
(xxiv) Disclosure Controls. The Company has established and maintains
disclosure controls and procedures (as such term is defined in Rule 13a-15
and Rule 15d-15 under the 0000 Xxx) that are designed to ensure that
information required to be disclosed by the Company in the reports that it
files or submits under the 1934 Act is recorded, processed, summarized and
reported, within the time periods specified in the Commission's rules and
forms, and is accumulated and communicated to the Company's management,
including its principal executive officer or officers and principal
financial officer or officers, as appropriate to allow timely decisions
regarding disclosure.
(xxv) No Extension of Credit. The Company has not, directly or
indirectly, extended credit, arranged to extend credit, or renewed any
extension of credit, in the form of a personal loan, to or for any director
or executive officer of the Company, or to or for any family member or
affiliate of any director or executive officer of the Company.
(xxvi) No Integration. Neither the Company nor any of its affiliates
(as defined in Rule 501(b) of Regulation D) has, directly or through any
agent, sold, offered for sale, solicited offers to buy or otherwise
negotiated in respect of, any security (as defined in the 1933 Act), that
is or will be integrated with the sale of the Securities in a manner that
would require registration of such securities under the 1933 Act.
(xxvii) Securities Law Exemptions. It is not necessary, in connection
with the issuance and sale of the Common Stock to the Adviser pursuant to
the Blackstone Private Placement, to register such Common Stock under the
Securities Act.
(b) Representations and Warranties by the Adviser. The Adviser represents
and warrants to each Underwriter as of the date hereof, as of the Closing Time
referred to in Section 2(c) hereof, and if any Option Securities are purchased,
as of each Date of Delivery referred to in Section 2(b) hereof, and agrees with
each Underwriter as follows:
(i) No Material Adverse Change in Business. Since the respective dates
as of which information is given in the Registration Statement and the
Prospectus, except as otherwise stated therein, there has been no material
adverse change in the condition, financial or otherwise, or in the
earnings, business affairs, business prospects or regulatory status of the
Adviser, whether or not arising in the ordinary course of business, or that
would otherwise prevent the Adviser from carrying out its obligations under
the Investment Advisory Agreement (collectively, an "Advisers' Material
Adverse Effect").
(ii) Good Standing. The Adviser has been duly formed and is validly
existing as a limited partnership, in good standing under the laws of the
State of Delaware, and has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under this
Agreement and the Investment Advisory Agreement; and the Adviser is duly
qualified to transact business as a foreign entity and is in good standing
in each other jurisdiction in which such qualification is required, whether
by reason of ownership or leasing of its property or the conduct of
business,
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except where the failure to qualify or be in good standing would not result
in an Advisers' Material Adverse Effect.
(iii) Registration Under Advisers Act. The Adviser is duly registered
with the Commission as an investment adviser under the Advisers Act and is
not prohibited by the Advisers Act, the 1940 Act or the applicable
published rules and regulations thereunder from acting under the Investment
Advisory Agreement for the Company as contemplated by the Prospectus. There
does not exist any proceeding or, to the Adviser's knowledge, any facts or
circumstances the existence of which could lead to any proceeding which
might adversely affect the registration of the Adviser with the Commission.
(iv) Absence of Proceedings. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or, to the knowledge of
the Adviser, threatened, against or affecting the Adviser, which is
required to be disclosed in the Registration Statement (other than as
disclosed therein), or which would result in a Material Adverse Effect or
an Advisers' Material Adverse Effect, or which would materially and
adversely affect the properties or assets thereof or the consummation of
the transactions contemplated in this Agreement and the Investment Advisory
Agreement or the performance by the Adviser of its obligations hereunder or
thereunder; the aggregate of all pending legal or governmental proceedings
to which the Adviser is a party or of which any of its property or assets
is the subject which are not described in the Registration Statement,
including ordinary routine litigation incidental to its business, would not
result in a Advisers' Material Adverse Effect.
(v) Absence of Defaults and Conflicts. The Adviser is not in violation
of its organizational documents, or in default in the performance or
observance of any obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, deed of trust, loan or credit agreement,
note, lease or other agreement or instrument to which the Adviser is a
party or by which it may be bound, or to which any of the property or
assets of the Adviser is subject (collectively, the "Adviser Agreements and
Instruments"), or in violation of any law, statute, rule, regulation,
judgment, order or decree except for such violations or defaults that would
not result in a Material Adverse Effect or an Advisers' Material Adverse
Effect; and the execution, delivery and performance of this Agreement and
the Investment Advisory Agreement and the consummation of the transactions
contemplated herein and therein and in the Registration Statement
(including the issuance and sale of the Securities and the use of the
proceeds from the sale of the Securities as described in the Prospectus
under the caption "Use of Proceeds") and compliance by the Adviser with its
obligations hereunder and under the Investment Advisory Agreement have been
duly authorized by all necessary corporate action and do not and will not,
whether with or without the giving of notice or passage of time or both,
conflict with or constitute a breach of, or default or Adviser Repayment
Event (as defined below) under, or result in the creation or imposition of
any lien, charge or encumbrance upon any property or assets of the Adviser
pursuant to, the Adviser Agreements and Instruments (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that
would not result in a Material Adverse Effect), nor will such action result
in any violation of the provisions of the organizational documents of the
Adviser, or any applicable law, statute, rule, regulation, judgment, order,
writ or decree of any government, government instrumentality or court,
domestic or foreign, having jurisdiction over the Adviser or any of its
assets, properties or operations. As used herein, an "Adviser Repayment
Event" means any event or condition which gives the holder of any note,
debenture or other evidence of indebtedness (or any person acting on such
holder's behalf) the right to require the repurchase, redemption or
repayment of all or a portion of such indebtedness by the Adviser.
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(vi) Authorization of Agreements. Each of this Agreement and the
Investment Advisory Agreement have been duly authorized, executed and
delivered by the Adviser. The Investment Advisory Agreement is a valid and
binding obligation of the Adviser, enforceable against the Adviser in
accordance with its terms, except as the enforcement thereof may be subject
to (i) bankruptcy, insolvency, reorganization, moratorium or other similar
laws now or thereafter in effect relating to creditors' rights generally
and (ii) general principles of equity and the discretion of the court
before which any proceeding therefor may be brought.
(vii) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
is necessary or required for the performance by the Adviser of its
obligations hereunder, in connection with the offering, issuance or sale of
the Securities hereunder or the consummation of the transactions
contemplated by this Agreement and the Investment Advisory Agreement,
except (A) such as have been already obtained under the 1933 Act, the 1933
Act Regulations or the 1940 Act, (B) such as may be required under the 1933
Act, the 1933 Act Regulations or state securities laws and (C) the filing
of the Notification of Election under the 1940 Act, which has been
effected.
(viii) Description of Adviser. The description of the Adviser
contained in the Prospectus complies in all material respects with the
provisions of the 1940 Act and the applicable published rules and
regulations thereunder, as applicable to business development companies,
and the 1933 Act and the applicable published rules and regulations
thereunder, and does not, and prior to the time of purchase will not,
contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading.
(ix) Financial Resources. The Adviser has the financial resources
available to it necessary for the performance of its services and
obligations as contemplated in the Prospectus and under this Agreement and
the Investment Advisory Agreement.
(x) Possession of Licenses and Permits. The Adviser possesses such
Governmental Licenses issued by the appropriate federal, state, local or
foreign regulatory agencies or bodies necessary to conduct the business now
operated by it, except where the failure so to possess would not result in
a Material Adverse Effect or an Advisers' Material Adverse Effect; the
Adviser is in compliance with the terms and conditions of all such
Governmental Licenses, except where the failure so to comply would not
result in a Material Adverse Effect or an Advisers' Material Adverse
Effect; all of the Governmental Licenses are valid and in full force and
effect, except when the invalidity of such Governmental Licenses or the
failure of such Governmental Licenses to be in full force and effect would
not result in a Material Adverse Effect or an Advisers' Material Adverse
Effect; and the Adviser has not received any notice of proceedings relating
to the revocation or modification of any such Governmental Licenses which,
singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would result in a Material Adverse Effect or an
Advisers' Material Adverse Effect.
(xi) Stabilization and Manipulation. Neither the Adviser nor any of
its partners, officers, affiliates or controlling persons has taken, nor
will the Adviser or any of its partners, officers, affiliates or
controlling persons take, directly or indirectly, any action which is
designed to or which has constituted or which would reasonably be expected
to cause or result in the stabilization or manipulation of the price of the
Securities.
10
(xii) Employment Status. The Adviser is not aware that (A) any
executive, key employee or significant group of employees of the Company,
if any, or the Adviser plans to terminate employment with the Company or
the Adviser or (B) any such executive or key employee is subject to any
non-compete, nondisclosure, confidentiality, employment, consulting or
similar agreement that would be violated by the present or proposed
business activities of the Company or the Adviser except where such
termination or violation would not constitute a Material Adverse Effect or
an Advisers' Material Adverse Effect.
(xiii) Internal Controls. The Adviser operates a system of internal
controls sufficient to provide reasonable assurance that (A) transactions
effectuated by it under the Investment Advisory Agreement are executed in
accordance with its management's general or specific authorization; and (B)
access to the Company's assets is permitted only in accordance with its
management's general or specific authorization.
(xiv) Accounting Controls. The Adviser operates a system of internal
accounting controls sufficient to provide reasonable assurance that (A)
transactions for which it has bookkeeping and record keeping responsibility
for under the Investment Advisory Agreement, if any, are recorded as
necessary to permit preparation of the Company's financial statements in
conformity with generally accepted accounting principles and to maintain
financial statements in conformity with generally accepted accounting
principles and to maintain accountability for the Company's assets and (B)
the recorded accountability for such assets is compared with existing
assets at reasonable intervals and appropriate action is taken with respect
to any differences.
(c) Officer's Certificates. Any certificate signed by any officer of the
Company or the Adviser delivered to the Representatives or to counsel for the
Underwriters shall be deemed a representation and warranty by the Company or the
Adviser, as applicable, to each Underwriter as to the matters covered thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) Initial Securities. On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Company agrees to sell to each Underwriter, severally and not jointly, and each
Underwriter, severally and not jointly, agrees to purchase from the Company, at
the price per share set forth in Schedule B, the number of Initial Securities
set forth in Schedule A opposite the name of such Underwriter, plus any
additional number of Initial Securities which such Underwriter may become
obligated to purchase pursuant to the provisions of Section 10 hereof.
(b) Option Securities. In addition, on the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company hereby grants an option to the Underwriters, severally and
not jointly, to purchase up to an additional ____ shares of Common Stock at the
price per share set forth in Schedule B, less an amount per share equal to any
dividends or distributions declared by the Company and payable on the Initial
Securities but not payable on the Option Securities. The option hereby granted
will expire 30 days after the date hereof and may be exercised in whole or in
part from time to time only for the purpose of covering over allotments which
may be made in connection with the offering and distribution of the Initial
Securities upon notice by the Representatives to the Company setting forth the
number of Option Securities as to which the several Underwriters are then
exercising the option and the time and date of payment and delivery for such
Option Securities. Any such time and date of delivery (a "Date of Delivery")
shall be determined by the Representatives, but shall not be later than seven
full business days after the exercise of said option, nor in any event prior to
the Closing Time, as hereinafter defined. If the option is exercised as to all
or any portion of the Option
11
Securities, each of the Underwriters, acting severally and not jointly, will
purchase that proportion of the total number of Option Securities then being
purchased which the number of Initial Securities set forth in Schedule A
opposite the name of such Underwriter bears to the total number of Initial
Securities, subject in each case to such adjustments as the Representatives in
their discretion shall make to eliminate any sales or purchases of fractional
shares.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of Fried,
Frank, Harris, Xxxxxxx & Xxxxxxxx LLP, Xxx Xxx Xxxx Xxxxx, Xxx Xxxx, XX 00000,
or at such other place as shall be agreed upon by the Representatives and the
Company, at 9:00 A.M. (Eastern time) on the third (fourth, if the pricing occurs
after 4:30 P.M. (Eastern time) on any given day) business day after the date
hereof (unless postponed in accordance with the provisions of Section 10), or
such other time not later than ten business days after such date as shall be
agreed upon by the Representatives and the Company (such time and date of
payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the Option Securities are
purchased by the Underwriters, payment of the purchase price for, and delivery
of certificates for, such Option Securities shall be made at the above-mentioned
offices, or at such other place as shall be agreed upon by the Representatives
and the Company, on each Date of Delivery as specified in the notice from the
Representatives to the Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
the Representatives for the respective accounts of the Underwriters of
certificates for the Securities to be purchased by them. It is understood that
each Underwriter has authorized the Representatives, for its account, to accept
delivery of, receipt for, and make payment of the purchase price for, the
Initial Securities and the Option Securities, if any, which it has agreed to
purchase. Xxxxxxx Xxxxx, individually and not as representative of the
Underwriters, may (but shall not be obligated to) make payment of the purchase
price for the Initial Securities or the Option Securities, if any, to be
purchased by any Underwriter whose funds have not been received by the Closing
Time or the relevant Date of Delivery, as the case may be, but such payment
shall not relieve such Underwriter from its obligations hereunder.
(d) Denominations; Registration. Certificates for the Initial Securities
and the Option Securities, if any, shall be in such denominations and registered
in such names as the Representatives may request in writing at least one full
business day before the Closing Time or the relevant Date of Delivery, as the
case may be. The certificates for the Initial Securities and the Option
Securities, if any, will be made available for examination and packaging by the
Representatives in The City of New York not later than 10:00 A.M. (Eastern time)
on the business day prior to the Closing Time or the relevant Date of Delivery,
as the case may be.
SECTION 3. Covenants of the Company and the Adviser. The Company and the
Adviser, jointly and severally, covenant with each Underwriter as follows:
(a) Compliance with Securities Regulations and Commission Requests. The
Company, subject to Section 3(b), will comply with the requirements of Rule 430A
and Rule 497 and will notify the Representatives immediately, and confirm the
notice in writing, (i) when any post-effective amendment to the Registration
Statement shall become effective, or any supplement to the Prospectus or any
amended Prospectus shall have been filed, (ii) of the receipt of any comments
from the Commission, (iii) of any request by the Commission for any amendment to
the Registration Statement or any amendment or supplement to the Prospectus or
for additional information, and (iv) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement or of any
order preventing or
12
suspending the use of any preliminary prospectus, or of the suspension of the
qualification of the Securities for offering or sale in any jurisdiction, or of
the initiation or threatening of any proceedings for any of such purposes. The
Company will promptly effect the filings necessary pursuant to Rule 497(h) and
will take such steps as it deems necessary to ascertain promptly whether the
form of prospectus transmitted for filing under Rule 497(h) was received for
filing by the Commission and, in the event that it was not, it will promptly
file such prospectus. The Company will make every reasonable effort to prevent
the issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
(b) Filing of Amendments. The Company will give the Representatives notice
of its intention to file or prepare any amendment to the Registration Statement
(including any filing under Rule 462(b)) or any amendment, supplement or
revision to either the prospectus included in the Registration Statement at the
time it became effective or to the Prospectus, will furnish the Representatives
with copies of any such documents a reasonable amount of time prior to such
proposed filing or use, as the case may be, and will not file or use any such
document to which the Representatives or counsel for the Underwriters shall
object.
(c) Delivery of Commission Filings. The Company has furnished or will
deliver to the Representatives and counsel for the Underwriters, without charge,
signed copies of the Notification of Election and the Registration Statement,
each as originally filed, and of each amendment thereto (including exhibits
filed therewith or incorporated by reference therein) and signed copies of all
consents and certificates of experts, and will also deliver to the
Representatives, without charge, a conformed copy of the Notification of
Election and the Registration Statement as originally filed and of each
amendment thereto (without exhibits) for each of the Underwriters. The copies of
the Notification of Election and the Registration Statement and each amendment
thereto furnished to the Underwriters will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to XXXXX, except
to the extent permitted by Regulation S-T, or as filed with the Commission in
paper form as permitted by Regulation S-T.
(d) Delivery of Prospectuses. The Company has delivered to each
Underwriter, without charge, as many copies of each preliminary prospectus as
such Underwriter reasonably requested, and the Company hereby consents to the
use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each Underwriter, without charge, during the period when the
Prospectus is required to be delivered under the 1933 Act, such number of copies
of the Prospectus (as amended or supplemented) as such Underwriter may
reasonably request. The Prospectus and any amendments or supplements thereto
furnished to the Underwriters will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to XXXXX, except
to the extent permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will comply with
the 1933 Act and the 1933 Act Regulations so as to permit the completion of the
distribution of the Securities as contemplated in this Agreement and in the
Prospectus. If at any time when a prospectus is required by the 1933 Act to be
delivered in connection with sales of the Securities, any event shall occur or
condition shall exist as a result of which it is necessary, in the opinion of
counsel for the Underwriters or for the Company, to amend the Registration
Statement or amend or supplement the Prospectus in order that the Prospectus
will not include any untrue statements of a material fact or omit to state a
material fact necessary in order to make the statements therein not misleading
in the light of the circumstances existing at the time it is delivered to a
purchaser, or if it shall be necessary, in the opinion of such counsel, at any
such time to amend the Registration Statement or amend or supplement the
Prospectus in order to comply with the requirements of the 1933 Act or the 1933
Act Regulations, the Company will promptly prepare and file with the Commission,
subject to Section 3(b), such amendment or supplement as may be necessary to
correct such statement or omission or to make the Registration Statement or the
Prospectus
13
comply with such requirements, and the Company will furnish to the Underwriters
such number of copies of such amendment or supplement as the Underwriters may
reasonably request.
(f) Blue Sky Qualifications. The Company will use its reasonable best
efforts, in cooperation with the Underwriters, to qualify the Securities for
offering and sale under the applicable securities laws of such states and other
jurisdictions (domestic or foreign) as the Representatives may designate and to
maintain such qualifications in effect for a period of not less than one year
from the later of the effective date of the Registration Statement and any Rule
462(b) Registration Statement; provided, however, that the Company shall not be
obligated to file any general consent to service of process or to qualify as a
foreign corporation or as a dealer in securities in any jurisdiction in which it
is not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject.
(g) Rule 158. The Company will timely file such reports pursuant to the
1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of Section
11(a) of the 1933 Act.
(h) Use of Proceeds. The Company will use the net proceeds received by it
from the sale of the Securities in the manner specified in the Prospectus under
"Use of Proceeds".
(i) Listing. The Company will use its best efforts to effect and maintain
the quotation of the Securities on the Nasdaq National Market.
(j) Restriction on Sale of Securities. During a period of 180 days from the
date of the Prospectus, neither the Company nor the Adviser will, without the
prior written consent of the Representatives, (i) directly or indirectly, offer,
pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to
purchase or otherwise transfer or dispose of any share of Common Stock or any
securities convertible into or exercisable or exchangeable for Common Stock or
file any registration statement under the 1933 Act with respect to any of the
foregoing or (ii) enter into any swap or any other agreement or any transaction
that transfers, in whole or in part, directly or indirectly, the economic
consequence of ownership of the Common Stock, whether any such swap or
transaction described in clause (i) or (ii) above is to be settled by delivery
of Common Stock or such other securities, in cash or otherwise. The foregoing
sentence shall not apply to (A) the Securities to be sold hereunder, (B) any
shares of Common Stock issued by the Company upon the exercise of an option or
warrant or the conversion of a security outstanding on the date hereof and
referred to in the Prospectus, (C) any shares of Common Stock issued or options
to purchase Common Stock granted pursuant to existing employee benefit plans of
the Company referred to in the Prospectus or (D) any shares of Common Stock
issued pursuant to any non-employee director stock plan or dividend reinvestment
plan.
(k) Reporting Requirements. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act, will file all
documents required to be filed with the Commission pursuant to the 1934 Act
within the time periods required by the 1934 Act and the rules and regulations
of the Commission thereunder.
(l) Business Development Company Status. The Company, during a period of
two years from the effective date of the Company's election to be a business
development company, will use its best efforts to maintain its status as a
business development company; provided, however, the Company may change the
nature of its business so as to cease to be, or to withdraw its election as, a
business
14
development company, with the approval of the board of directors and a vote of
stockholders as required by Section 58 of the 1940 Act or any successor
provision.
(m) Regulated Investment Company Status. The Company will use its best
efforts to qualify for and elect to be treated as a regulated investment company
under Subchapter M of the Code and to maintain such qualification and election
in effect for each full fiscal year during which it is a business development
company under the 1940 Act; provided that, at the discretion of the Company's
board of directors, it may not elect to be so treated.
(n) Accounting Controls. The Company will establish and maintain a system
of internal accounting controls sufficient to provide reasonable assurances that
(A) transactions are executed in accordance with management's general or
specific authorization; (B) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets; (C) access to
assets is permitted only in accordance with management's general or specific
authorization; (D) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is taken with
respect to any differences; (E) material information relating to the Company and
the assets managed by the Adviser is promptly made known to the officers
responsible for establishing and maintaining the system of internal accounting
controls; and (F) any significant deficiencies or weaknesses in the design or
operation of internal accounting controls which could adversely affect the
Company's ability to record, process, summarize and report financial data, and
any fraud whether or not material that involves management or other employees
who have a significant role in internal controls, are adequately and promptly
disclosed to the Company's independent auditors and the audit committee of the
Company's board of directors.
SECTION 4. Payment of Expenses.
(a) Expenses. The Company will pay all expenses incident to the performance
of its and the Advisers obligations under this Agreement, including (i) the
preparation, printing and filing of the Registration Statement (including
financial statements and exhibits) as originally filed and of each amendment
thereto, (ii) the preparation, printing and delivery to the Underwriters of this
Agreement, any Agreement among Underwriters and such other documents as may be
required in connection with the offering, purchase, sale, issuance or delivery
of the Securities, (iii) the preparation, issuance and delivery of the
certificates for the Securities to the Underwriters, including any stock or
other transfer taxes and any stamp or other duties payable upon the sale,
issuance or delivery of the Securities to the Underwriters, (iv) the fees and
disbursements of the Company's and the Adviser's counsel, accountants and other
advisors, (v) the qualification of the Securities under securities laws in
accordance with the provisions of Section 3(f) hereof, including filing fees and
the reasonable fees and disbursements of counsel for the Underwriters in
connection therewith and in connection with the preparation of the Blue Sky
Survey and any supplement thereto, (vi) the printing and delivery to the
Underwriters of copies of each preliminary prospectus and of the Prospectus and
any amendments or supplements thereto, (vii) the preparation, printing and
delivery to the Underwriters of copies of the Blue Sky Survey and any supplement
thereto, (viii) the fees and expenses of any transfer agent or registrar for the
Securities, (ix) the costs and expenses of the Company relating to investor
presentations on any "road show" undertaken in connection with the marketing of
the Securities, including without limitation, expenses associated with the
production of road show slides and graphics, fees and expenses of any
consultants engaged in connection with the road show presentations, travel and
lodging expenses of the representatives and officers of the Company and any such
consultants (excluding, for purposes of clarification, representatives and
officers of any of the Underwriters), and one-half the cost of aircraft and
other transportation chartered in connection with the road show, (x) the filing
fees incident to, and the reasonable fees and disbursements of counsel to the
Underwriters in connection with, the review by the NASD of the terms of the sale
of the Securities and
15
(xi) the fees and expenses incurred in connection with the inclusion of the
Securities in the Nasdaq National Market.
(b) Termination of Agreement. If this Agreement is terminated by the
Representatives in accordance with the provisions of Section 5 or Section
9(a)(i) hereof, the Company and the Adviser, jointly and severally, shall
reimburse the Underwriters for all of their out-of-pocket expenses, including
the reasonable fees and disbursements of counsel for the Underwriters.
SECTION 5. Conditions of Underwriters' Obligations. The obligations of the
several Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company and the Adviser contained in
Section 1 hereof or in certificates of any officer of the Company or the Adviser
to the performance by the Company and the Adviser of their respective covenants
and other obligations hereunder, and to the following further conditions:
(a) Effectiveness of Registration Statement. The Registration Statement,
including any Rule 462(b) Registration Statement, has become effective and at
Closing Time no stop order suspending the effectiveness of the Registration
Statement shall have been issued under the 1933 Act or proceedings therefor
initiated or threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to the
reasonable satisfaction of counsel to the Underwriters. A prospectus containing
the Rule 430A Information shall have been filed with the Commission in
accordance with Rule 497(h) (or a post-effective amendment providing such
information shall have been filed and declared effective in accordance with the
requirements of Rule 430A).
(b) Opinions of Counsel for Company. At Closing Time, the Representatives
shall have received the favorable opinion, dated as of Closing Time, of
Debevoise & Xxxxxxxx LLP, counsel for the Company, Xxxxxxx LLP, special Maryland
counsel for the Company, and Xxxxxx X. Xxxxxxxx, Senior Managing Director, Chief
Administrative Officer and Chief Legal Officer of Blackstone Group Holdings
L.P., in each case in form and substance satisfactory to counsel for the
Underwriters, together with signed or reproduced copies of such letter for each
of the other Underwriters to the effect set forth in Exhibits A, B and C hereto
and to such further effect as counsel to the Underwriters may reasonably
request.
(c) Opinion of Counsel for Underwriters. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of Closing
Time, of Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx LLP, counsel for the
Underwriters, together with signed or reproduced copies of such letter for each
of the other Underwriters in form and substance reasonably satisfactory to the
Representatives. In giving such opinion such counsel may rely, as to all matters
governed by the laws of jurisdictions other than the law of the State of New
York and the federal law of the United States upon the opinions of counsel
satisfactory to the Representatives, including counsel of the Company. Such
counsel may also state that, insofar as such opinion involves factual matters,
they have relied, to the extent they deem proper, upon certificates of officers
of the Company and certificates of public officials.
(d) Officers' Certificates. (i) At Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information is
given in the Prospectus, any material adverse change in the condition, financial
or otherwise, or in the earnings, business affairs or business prospects of the
Company, whether or not arising in the ordinary course of business, and the
Representatives shall have received a certificate of the President or a Vice
President of the Company and of the chief financial or chief accounting officer
of the Company, dated as of Closing Time, to the effect that (i) there has been
no such material adverse change, (ii) the representations and warranties in
Section 1(a) hereof are true and correct with the same force and effect as
though expressly made at and as of Closing Time, (iii) the Company has complied
with all agreements and satisfied all conditions on its part to be performed or
16
satisfied at or prior to Closing Time, and (iv) no stop order suspending the
effectiveness of the Registration Statement has been issued and no proceedings
for that purpose have been instituted or are pending or, to their knowledge,
contemplated by the Commission.
(ii) At Closing Time, there shall not have been, since the date hereof or
since the respective dates as of which information is given in the Prospectus,
any material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Adviser, whether or not
arising in the ordinary course of business, and the Representatives shall have
received a certificate of a partner of Blackstone Mezzanine Advisors L.P., dated
as of Closing Time, to the effect that (i) there has been no such material
adverse change, (ii) the representations and warranties in Sections 1(a) and
1(b) hereof are true and correct with the same force and effect as though
expressly made at and as of Closing Time, (iii) the Company and the Adviser have
complied with all agreements and satisfied all conditions on their part to be
performed or satisfied at or prior to Closing Time, and (iv) no stop order
suspending the effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been instituted or are pending or, to their
knowledge, contemplated by the Commission.
(e) Accountant's Comfort Letter. At the time of the execution of this
Agreement, the Representatives shall have received from PricewaterhouseCoopers
LLP a letter dated such date, in form and substance satisfactory to the
Representatives, together with signed or reproduced copies of such letter for
each of the other Underwriters containing statements and information of the type
ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in the Registration Statement and the Prospectus.
(f) Bring-down Comfort Letter. At Closing Time, the Representatives shall
have received from PricewaterhouseCoopers LLP a letter, dated as of Closing
Time, to the effect that they reaffirm the statements made in the letter
furnished pursuant to subsection (e) of this Section, except that the specified
date referred to shall be a date not more than three business days prior to
Closing Time.
(g) Approval of Listing. At Closing Time, the Securities shall have been
approved for inclusion in the Nasdaq National Market, subject only to official
notice of issuance.
(h) No Objection. The NASD shall have confirmed that it has not raised any
objection with respect to the fairness and reasonableness of the underwriting
terms and arrangements with respect to the Securities.
(i) Blackstone Private Placement. The Blackstone Private Placement shall
have been consummated prior to the Closing Time.
(j) Blackstone Mezzanine Partners L.P. Amendment. At Closing Time, the
Representatives shall have received an executed amendment (the "BMP Amendment")
to the Blackstone Mezzanine Partners L.P. ("BMP") partnership agreement, in form
and substance reasonably satisfactory to the Representatives, providing that BMP
will cease to make any investments in new portfolio companies as of and after
the Closing Time, together with a certificate of the general partner of BMP
certifying that such BMP Amendment is in full force and effect.
(k) Conditions to Purchase of Option Securities. In the event that the
Underwriters exercise their option provided in Section 2(b) hereof to purchase
all or any portion of the Option Securities, the representations and warranties
of the Company and the Adviser contained herein and the statements in any
certificates furnished by the Company and the Adviser hereunder shall be true
and correct as of each Date of Delivery and, at the relevant Date of Delivery,
the Representatives shall have received:
17
(i) Officers' Certificates. (A) A certificate, dated such Date of
Delivery, of the President or a Vice President of the Company and of the
chief financial or chief accounting officer of the Company confirming that
the certificate delivered at the Closing Time pursuant to Section 5(d)(i)
hereof remains true and correct as of such Date of Delivery.
(B) A certificate, dated such Date of Delivery, of a partner of
Blackstone Mezzanine Advisors L.P. confirming that the certificate
delivered at the Closing Time pursuant to Section 5(d)(ii) hereof remains
true and correct as of such Date of Delivery.
(ii) Opinion of Counsel for Company. The favorable opinion of
Debevoise & Xxxxxxxx LLP, counsel for the Company, Xxxxxxx LLP, special
Maryland counsel for the Company, and Xxxxxx X. Xxxxxxxx, Senior Managing
Director, Chief Administrative Officer and Chief Legal Officer of
Blackstone Group Holdings L.P., in each case in form and substance
satisfactory to counsel for the Underwriters, dated such Date of Delivery,
relating to the Option Securities to be purchased on such Date of Delivery
and otherwise to the same effect as the opinions required by Section 5(b)
hereof.
(iii) Opinion of Counsel for Underwriters. The favorable opinion of
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx, LLP, counsel for the
Underwriters, dated such Date of Delivery, relating to the Option
Securities to be purchased on such Date of Delivery and otherwise to the
same effect as the opinion required by Section 5(c) hereof.
(iv) Bring-down Comfort Letter. A letter from Pricewaterhouse Coopers
LLP, in form and substance satisfactory to the Representatives and dated
such Date of Delivery, substantially in the same form and substance as the
letter furnished to the Representatives pursuant to Section 5(f) hereof,
except that the "specified date" in the letter furnished pursuant to this
paragraph shall be a date not more than five days prior to such Date of
Delivery.
(l) Additional Documents. At Closing Time and at each Date of Delivery,
counsel for the Underwriters shall have been furnished with such documents and
opinions as they may reasonably require for the purpose of enabling them to pass
upon the issuance and sale of the Securities as herein contemplated, or in order
to evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company and the Adviser in connection with the issuance and sale of
the Securities as herein contemplated shall be satisfactory in form and
substance to the Representatives and counsel for the Underwriters.
(m) Termination of Agreement. If any condition specified in this Section
shall not have been fulfilled when and as required to be fulfilled, this
Agreement, or, in the case of any condition to the purchase of Option
Securities, on a Date of Delivery which is after the Closing Time, the
obligations of the several Underwriters to purchase the relevant Option
Securities, may be terminated by the Representatives by notice to the Company at
any time at or prior to Closing Time or such Date of Delivery, as the case may
be, and such termination shall be without liability of any party to any other
party except as provided in Section 4 and except that Sections 1, 6, 7 and 8
shall survive any such termination and remain in full force and effect.
SECTION 6. Indemnification.
(a) Indemnification of Underwriters. The Company and the Adviser, jointly
and severally, agree to indemnify and hold harmless each Underwriter, its
affiliates, as such term is defined in Rule 501(b) under the 1933 Act (each, an
"Affiliate"), its selling agents and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act as follows:
18
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(or any amendment thereto), including the Rule 430A Information or the
omission or alleged omission therefrom of a material fact required to be
stated therein or necessary to make the statements therein not misleading
or arising out of any untrue statement or alleged untrue statement of a
material fact included in any preliminary prospectus or the Prospectus (or
any amendment or supplement thereto), or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided that (subject to Section
6(d) below) any such settlement is effected with the written consent of the
Company;
(iii) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by the Representatives),
reasonably incurred in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency
or body, commenced or threatened, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue statement or
omission, to the extent that any such expense is not paid under (i) or (ii)
above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through the Representatives expressly for use in the Registration
Statement (or any amendment thereto), including the Rule 430A Information or any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(b) Indemnification of Company, Directors, Officers and Adviser. Each
Underwriter severally agrees to indemnify and hold harmless the Company, its
directors, each of its officers who signed the Registration Statement, each
person, if any, who controls the Company within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act, and the Adviser, against any and all
loss, liability, claim, damage and expense described in the indemnity contained
in subsection (a) of this Section, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information or any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with written information
furnished to the Company by such Underwriter through the Representatives
expressly for use in the Registration Statement (or any amendment thereto) or
such preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(c) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by the Representatives,
and, in the case of parties indemnified pursuant to Section 6(b) above, counsel
to the indemnified parties shall be selected by the
19
Company. An indemnifying party may participate at its own expense in the defense
of any such action; provided, however, that counsel to the indemnifying party
shall not (except with the consent of the indemnified party) also be counsel to
the indemnified party. In no event shall the indemnifying parties be liable for
fees and expenses of more than one counsel (in addition to any single local
counsel) separate from their own counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances.
No indemnifying party shall, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 6 or Section 7 hereof (whether or not the indemnified parties
are actual or potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified party from all
liability arising out of such litigation, investigation, proceeding 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.
(d) Settlement Without Consent if Failure to Reimburse. If at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
SECTION 7. Contribution. If the indemnification provided for in Section 6
hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company and the
Adviser on the one hand and the Underwriters on the other hand from the offering
of the Securities pursuant to this Agreement or (ii) if the allocation provided
by clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company and the Adviser on the one hand
and of the Underwriters on the other hand in connection with the statements or
omissions which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company and the Adviser on the one
hand and the Underwriters on the other hand in connection with the offering of
the Securities pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the
Securities pursuant to this Agreement (before deducting expenses) received by
the Company and the total underwriting discount received by the Underwriters, in
each case as set forth on the cover of the Prospectus, bear to the aggregate
initial public offering price of the Securities as set forth on the cover of the
Prospectus.
The relative fault of the Company and the Adviser on the one hand and the
Underwriters on the other hand shall be determined by reference to, among other
things, whether any such untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Company and the Adviser or by the Underwriters and the parties'
relative
20
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
The Company, the Adviser and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section 7 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 Section 7. The
aggregate amount of losses, liabilities, claims, damages and expenses incurred
by an indemnified party and referred to above in this Section 7 shall be deemed
to include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Securities 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 any 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 0000 Xxx) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act and each Underwriter's Affiliates and selling agents shall have the
same rights to contribution as such Underwriter, and each director of the
Company, each officer of the Company who signed the Registration Statement, and
each person, if any, who controls the Company within the meaning of Section 15
of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to
contribution as the Company. The Underwriters' respective obligations to
contribute pursuant to this Section 7 are several in proportion to the number of
Initial Securities set forth opposite their respective names in Schedule A
hereto and not joint.
SECTION 8. Representations, Warranties and Agreements to Survive. All
representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company and the Adviser submitted pursuant
hereto, shall remain operative and in full force and effect regardless of (i)
any investigation made by or on behalf of any Underwriter or its Affiliates or
selling agents, any person controlling any Underwriter, its officers or
directors or any person controlling the Company and (ii) delivery of and payment
for the Securities.
SECTION 9. Termination of Agreement.
(a) Termination; General. The Representatives may terminate this Agreement,
by notice to the Company, at any time at or prior to Closing Time (i) if there
has been, since the time of execution of this Agreement or since the respective
dates as of which information is given in the Prospectus, any material adverse
change in the condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company or the Adviser, whether or not
arising in the ordinary course of business, or (ii) if there has occurred any
material adverse change in the financial markets in the United States or the
international financial markets, any outbreak of hostilities or escalation
thereof or other calamity or crisis or any change or development involving a
prospective change in national or international political, financial or economic
conditions, in each case the effect of which is such as to make it, in the
judgment of the Representatives, impracticable or inadvisable to market the
Securities or to enforce contracts for the
21
sale of the Securities, or (iii) if trading in any securities of the Company has
been suspended or materially limited by the Commission or Nasdaq National
Market, or if trading generally on the American Stock Exchange or the New York
Stock Exchange or in the Nasdaq National Market has been suspended or materially
limited, or minimum or maximum prices for trading have been fixed, or maximum
ranges for prices have been required, by any of said exchanges or by such system
or by order of the Commission, the National Association of Securities Dealers,
Inc. or any other governmental authority, or (iv) a material disruption has
occurred in commercial banking or securities settlement or clearance services in
the United States, or (v) if a banking moratorium has been declared by either
Federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this Section,
such termination shall be without liability of any party to any other party
except as provided in Section 4 hereof, and provided further that Sections 1, 6,
7 and 8 shall survive such termination and remain in full force and effect.
SECTION 10. Default by One or More of the Underwriters. If one or more of
the Underwriters shall fail at Closing Time or a Date of Delivery to purchase
the Securities which it or they are obligated to purchase under this Agreement
(the "Defaulted Securities"), the Representatives shall have the right, within
24 hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms herein set forth; if, however, the Representatives shall not have
completed such arrangements within such 24-hour period, then:
(i) if the number of Defaulted Securities does not exceed 10% of the
number of Securities to be purchased on such date, each of the
non-defaulting Underwriters shall be obligated, severally and not jointly,
to purchase the full amount thereof in the proportions that their
respective underwriting obligations hereunder bear to the underwriting
obligations of all non-defaulting Underwriters, or
(ii) if the number of Defaulted Securities exceeds 10% of the number
of Securities to be purchased on such date, this Agreement or, with respect
to any Date of Delivery which occurs after the Closing Time, the obligation
of the Underwriters to purchase and of the Company to sell the Option
Securities to be purchased and sold on such Date of Delivery shall
terminate without liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination of
this Agreement or, in the case of a Date of Delivery which is after the Closing
Time, which does not result in a termination of the obligation of the
Underwriters to purchase and the Company to sell the relevant Option Securities,
as the case may be, either the Representatives or the Company shall have the
right to postpone Closing Time or the relevant Date of Delivery, as the case may
be, for a period not exceeding seven days in order to effect any required
changes in the Registration Statement or Prospectus or in any other documents or
arrangements. As used herein, the term "Underwriter" includes any person
substituted for an Underwriter under this Section 10.
SECTION 11. Notices. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Representatives at 4 World Financial
Center, New York, New York 10080, attention of Xxxxxx xx Xxxxxx, with a copy to
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx, Xxx Xxx Xxxx Xxxxx, Xxx
00
Xxxx, Xxx Xxxx 00000, attention Xxxxxxx Xxxxx; and notices to the Company and
the Adviser shall be directed to them at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, attention of Xxxxxx Xxxxxx, with a copy to Debevoise & Xxxxxxxx, 000
Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 attention Xxxxxxx X. Xxxxxxxx.
SECTION 12. Parties. This Agreement shall inure to the benefit of and be
binding upon each of the Underwriters and the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
Underwriters, the Company and the Adviser and their respective successors and
the controlling persons and officers and directors referred to in Sections 6 and
7 and their heirs and legal representatives, any legal or equitable right,
remedy or claim under or in respect of this Agreement or any provision herein
contained. This Agreement and all conditions and provisions hereof are intended
to be for the sole and exclusive benefit of the Underwriters, the Company and
the Adviser and their respective successors, and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Securities from
any Underwriter shall be deemed to be a successor by reason merely of such
purchase.
SECTION 13. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING
EFFECT TO CONFLICTS OF LAW PRINCIPLES THEREOF.
SECTION 14. TIME. TIME SHALL BE OF THE ESSENCE OF THIS AGREEMENT. EXCEPT AS
OTHERWISE SET FORTH HEREIN, SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 15. Counterparts. This Agreement may be executed 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 Agreement.
SECTION 16. Effect of Headings. The Section headings herein are for
convenience only and shall not affect the construction hereof.
23
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement between
the Underwriters, the Company and the Adviser in accordance with its terms.
Very truly yours,
COMPANY:
BLACKRIDGE INVESTMENT CORP.
By _______________________________________
Name:
Title:
ADVISER:
BLACKSTONE MEZZANINE ADVISORS L.P.
By _______________________________________
Name:
Title:
CONFIRMED AND ACCEPTED, as of the date first above written:
XXXXXXX XXXXX & CO.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
CITIGROUP GLOBAL MARKETS INC.
UBS SECURITIES LLC
By: XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By ____________________________________
Authorized Signatory
For themselves and as Representatives of the other Underwriters named in
Schedule A hereto.
24
SCHEDULE A
Number of
Name of Underwriter Initial Securities
------------------- ------------------
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated..................................
Citigroup Global Markets Inc..............................
UBS Securities LLC........................................
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated......................
Bear, Xxxxxxx & Co. Inc...................................
Xxxxx Xxxxxxx & Co........................................
------
Total.....................................................
-----
Sch A-1
SCHEDULE B
BLACKRIDGE INVESTMENT CORP.
[__] Shares of Common Stock
(Par Value $0.001 Per Share)
1. The initial public offering price per share for the Securities,
determined as provided in said Section 2, shall be $____.
2. The purchase price per share for the Securities to be paid by the
several Underwriters shall be $____, being an amount equal to the initial
public offering price set forth above less $____ per share; provided that
the purchase price per share for any Option Securities purchased upon the
exercise of the over allotment option described in Section 2(b) shall be
reduced by an amount per share equal to any dividends or distributions
declared by the Company and payable on the Initial Securities but not
payable on the Option Securities.
Sch B-1
