EXHIBIT 10.1
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EXECUTION COPY
$150,000,000
L-1 IDENTITY SOLUTIONS, INC.
3.75% Convertible Senior Notes due 2027
Purchase Agreement
May 10, 2007
BEAR, XXXXXXX & CO. INC.
BANC OF AMERICA SECURITIES LLC
As representatives of the Initial Purchasers
c/o Bear, Xxxxxxx & Co. Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
L-1 Holding Co. (to be renamed L-1 Identity Solutions, Inc. after
completion of the Reorganization Transaction described herein), a Delaware
corporation (the "COMPANY"), proposes to issue and sell to the initial
purchasers listed on Schedule I hereto (the "INITIAL PURCHASERS") for whom you
are acting as representatives (the "REPRESENTATIVES") $150,000,000 principal
amount of its 3.75% Convertible Senior Notes due 2027 (the "FIRM SECURITIES") to
be issued pursuant to the provisions of an Indenture (the "INDENTURE") to be
dated as of the Closing Date (as defined below) between the Company and The Bank
of New York, as Trustee (the "TRUSTEE"). The Company also proposes to issue and
sell to the Initial Purchasers not more than an additional $25,000,000 principal
amount of its 3.75% Convertible Senior Notes due 2027 (the "ADDITIONAL
SECURITIES," and together with the Firm Securities, the "SECURITIES") if and to
the extent that the Initial Purchasers shall have determined to exercise the
right to purchase such Additional Securities granted to the Initial Purchasers
in Section 1 hereof. The Securities will be convertible for shares (the
"UNDERLYING SECURITIES") of common stock of the Company, par value $0.001 per
share (the "COMMON STOCK"), subject to and in accordance with the terms of the
Securities.
In connection with the offering of the Securities and in order to
facilitate the structuring of potential future acquisitions, the Delaware
corporation currently named L-1 Identity Solutions, Inc. (the "OPERATING
COMPANY") will enter into reorganization transactions to implement a holding
company structure pursuant to Section 251(g) of the Delaware General Corporation
Law. In the reorganization transactions, (i) the operating company will merge
with and into a wholly owned subsidiary of the Company with the operating
company surviving the merger as a wholly owned subsidiary of the Company; (ii)
the outstanding shares of common stock of the operating company will be
converted into shares of common stock of the Company, the current governance
structure of the operating company will be replicated at the Company, and the
Company will assume certain employment arrangements and equity compensation
plans of the operating company; (iii) the Company will list its shares on the
New York Stock Exchange ("NYSE") as a successor to the operating company and
assume the operating company's ticker symbol "ID"; (iv) the operating company
will change its name to "L-1 Identity Solutions Operating Company"; and (v) X-0
Xxxxxxx Xx. will change its name to "L-1 Identity Solutions, Inc." These
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reorganization transactions are referred to herein as the "REORGANIZATION
TRANSACTION."
The Securities and the Underlying Securities will be offered without being
registered under the Securities Act of 1933, as amended (together with the rules
and regulations promulgated thereunder, the "SECURITIES ACT"), only to
"qualified institutional buyers" (as defined in the Securities Act) in
compliance with the exemption from registration provided by Rule 144A under the
Securities Act.
Each Initial Purchaser and its direct and indirect transferees will be
entitled to the benefits of a Registration Rights Agreement to be dated as of
the Closing Date between the Company and the Initial Purchasers (the
"REGISTRATION RIGHTS AGREEMENT"), pursuant to which the Company will agree,
among other things, to file (i) a registration statement on the appropriate form
with the Securities and Exchange Commission (the "COMMISSION") registering the
resale of the Securities under the Securities Act and (ii) to use commercially
reasonable best efforts to cause such registration statement to be declared
effective.
In connection with the sale of the Securities, the Company has prepared a
preliminary offering memorandum (including the documents incorporated by
reference therein, the "PRELIMINARY MEMORANDUM") and will prepare a final
offering memorandum (including the documents incorporated by reference therein,
the "FINAL MEMORANDUM" and, together with the Preliminary Memorandum, the
"OFFERING MEMORANDUM") for the information of the Initial Purchasers and for
delivery to prospective purchasers of the Securities. The Offering Memorandum
incorporates by reference the Company's (i) Quarterly Report on Form 10-Q for
the period ended March 31, 2007; (ii) Annual Report on Form 10-K for the year
ended December 31, 2006, (iii) Proxy Statement filed with the Commission on
April 6, 2007, and (iv) Current Reports on Form 8-K filed with the Commission on
January 9, 2007, January 11, 2007 (excluding Item 7.01), January 29, 2007
(excluding Item 7.01), February 13, 2007 (excluding Items 2.02 and 7.01), March
19, 2007, April 3, 2007, April 13, 2007, April 16, 2007 and May 2, 2007 and (v)
Current Report on Form 8-K/A filed with the Commission on December 26, 2006 (all
such documents listed in clauses (i) through (v) referred to herein as the
"INCORPORATED DOCUMENTS"). The time when sales of Securities are first made or
confirmed by the Initial Purchasers to qualified institutional buyers is
referred to as the "TIME OF SALE," and the Preliminary Memorandum, together with
the other information referenced on Schedule II hereto, is referred to as the
"TIME OF SALE INFORMATION."
As used in Sections 4, 5, 6, 7, 9, 12 and 13 herein, the "Company" means
(i) prior to the completion of the Reorganization Transaction, both L-1 Holding
Co. and L-1 Identity Solutions, Inc. and (ii) after completion of the
Reorganization Transaction, L-1 Identity Solutions, Inc. (for the avoidance of
doubt, the issuer of the Securities) only.
The Company and the operating company hereby agrees with the Initial
Purchasers as follows:
1. Agreements to Sell and Purchase. The Company agrees to issue and
sell the Firm Securities to the several Initial Purchasers as hereinafter
provided, and each Initial Purchaser, upon the basis of the representations and
warranties herein contained, but subject to the conditions hereinafter stated,
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agrees to purchase severally and not jointly, from the Company the Firm
Securities at a purchase price of 97.25% of the principal amount thereof (the
"PURCHASE PRICE"), in the respective principal amount of Securities set forth
opposite such Initial Purchaser's name in Schedule I hereto plus accrued
interest, if any, from May 17, 2007, to the date of payment and delivery.
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees to sell
to the Initial Purchasers the Additional Securities, and the Initial Purchasers
shall have the right to purchase in whole, or from time to time in part, up to
$25,000,000 principal amount of Additional Securities at the Purchase Price plus
accrued interest, if any, from the Closing Date to the date of payment and
delivery. If you on behalf of the Initial Purchasers exercise such option, you
shall so notify the Company in writing not later than 30 days after the date of
this Agreement, which notice shall specify the principal amount of Additional
Securities to be purchased by the Initial Purchasers and the date on which such
Additional Securities are to be purchased.
The Company acknowledges and agrees that the Initial Purchasers are acting
solely in the capacity of an arm's length contractual counterparty to the
Company with respect to the offering of Securities and the Underlying Securities
contemplated hereby (including in connection with determining the terms of the
offering) and not as a financial advisor or a fiduciary to, or an agent of, the
Company or any other person. Additionally, no Initial Purchaser is advising the
Company or any other person as to any legal, tax, investment, accounting or
regulatory matters in any jurisdiction. The Company shall consult with its own
advisors concerning such matters and shall be responsible for making its own
independent investigation and appraisal of the transactions contemplated hereby,
and the Initial Purchasers shall have no responsibility or liability to the
Company with respect thereto. Any review by the Initial Purchasers of the
Company, the transactions contemplated hereby or other matters relating to such
transactions will be performed solely for the benefit of the Initial Purchasers
and shall not be on behalf of the Company.
2. Terms of the Offering. The Company understands that the Initial
Purchasers intend (i) to offer privately pursuant to Rule 144A under the
Securities Act their respective portions of the Securities as soon after this
Agreement has become effective as in the judgment of the Initial Purchasers is
advisable and (ii) initially to offer the Securities upon the terms set forth in
the Final Memorandum.
The Company confirms that it has authorized the Initial Purchasers,
subject to the restrictions set forth below, to distribute copies of the
Offering Memorandum in connection with the offering of the Securities. Each
Initial Purchaser hereby severally makes to the Company the following
representations and agreements:
(i) it is a "qualified institutional buyer" within the meaning of
Rule 144A under the Securities Act;
(ii) offers and sales of the Securities will be made only by it or
its affiliates thereof qualified to do so in the jurisdictions in
which such offers or sales are made; and
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(iii) (A) it has not solicited offers for, or offered or sold, and
will not solicit offers for, or offer to sell, the Securities by
means of any form of general solicitation or general advertising (as
those terms are used in Regulation D under the Securities Act
("REGULATION D")) or in any manner involving a public offering
within the meaning of Section 4(2) of the Securities Act and (B) it
has solicited and will solicit offers for the Securities only from,
and has offered or sold and will offer, sell or deliver the
Securities only to persons who it reasonably believes to be
"qualified institutional buyers" or, if any such person is buying
for one or more institutional accounts for which such person is
acting as fiduciary or agent, only when such person has represented
to such Initial Purchaser that each such account is a "qualified
institutional buyers," within the meaning of Rule 144A under the
Securities Act that in purchasing the Securities are deemed to have
represented and agreed as provided in the Offering Memorandum.
With respect to offers and sales of the Securities to "qualified institutional
buyers" within the meaning of Rule 144A, as described in clause (iii)(B) above,
each Initial Purchaser hereby represents and agrees with the Company that prior
to or contemporaneously with the purchase of the Securities, the Initial
Purchaser will take reasonable steps to inform, and cause each of its affiliates
to take responsible steps to inform, persons acquiring Securities from such
Initial Purchaser or affiliate, as the case may be, that the Securities (A) are
being sold to them in reliance on Rule 144A under the Securities Act, (B) have
not been and, except as described in the Offering Memorandum, will not be
registered under the Securities Act, and (C) may not be offered, sold or
otherwise transferred except as described in the Offering Memorandum.
3. Payment for Securities. Payment for the Firm Securities shall be
made to the Company in Federal or other funds immediately available in New York
City against delivery of such Firm Securities for the account of the several
Initial Purchasers at 10:00 a.m., New York City time, on May 17, 2007 or at such
other time on the same or such other date, not later than May 31, 2007, as shall
be agreed upon in writing by the Company and you. The time and date of such
payment are hereinafter referred to as the "CLOSING DATE."
Payment for any Additional Securities shall be made to the Company in
Federal or other funds immediately available in New York City against delivery
of such Additional Securities for the account of the several Initial Purchasers
at 10:00 a.m., New York City time, on the date specified in the notice described
in Section 1 or at such other time on the same or on such other date, not later
than June 16, 2007, as shall be designated in writing by you. The time and date
of such payment are hereinafter referred to as the "OPTION CLOSING DATE."
The Firm Securities and Additional Securities, as the case may be, to be
purchased by each Initial Purchaser hereunder will be represented by one or more
definitive global certificates in book-entry form which will be deposited by or
on behalf of the Company with The Depository Trust Company ("DTC") or its
designated custodian. The Company will deliver the Firm Securities or the
Additional Securities on the Closing Date or the Option Closing Date, as the
case may be, to Bear, Xxxxxxx & Co. Inc., for the account of each Initial
Purchaser, against payment by or on behalf of such Initial Purchaser of the
purchase price therefor by wire transfer to the account of the Company of same
day funds, by causing DTC to credit the Firm Securities or the Additional
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Securities, as the case may be, to the account of Bear, Xxxxxxx & Co. Inc. at
DTC.
4. Representations and Warranties of the Company. The Company
represents and warrants to the Initial Purchasers that: (a) the Time of Sale
Information, did not, as of the Time of Sale and, will not, as of the Closing
Date, and the Final Memorandum did not, as of its date, and will not, as of the
Closing Date, contain 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; provided, however,
that this representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information relating to
any Initial Purchaser furnished to the Company in writing by such Initial
Purchaser through you expressly for use therein. The parties hereto agree that
such information provided by or on behalf of any Initial Purchaser through the
Representatives consists solely of the material referred to in Section 16
hereof;
(b) the Preliminary Offering Memorandum and the Offering
Memorandum with respect to the Securities have been or will be prepared by
the Company for use by the Initial Purchasers in connection with the
offering of the Securities. No order or decree preventing the use of the
Preliminary Offering Memorandum or the Offering Memorandum or any
amendment or supplement thereto, or any order asserting that the
transactions contemplated by this Agreement are subject to the
registration requirements of the Securities Act has been issued and no
proceeding for that purpose has commenced or is pending or, to the
knowledge of the Company, is contemplated;
(c) the Incorporated Documents in the Time of Sale Information and
the Final Memorandum, when they were filed with the Commission, conformed
in all material respects to the requirements of the Securities Exchange
Act of 1934, as amended, and the applicable rules and regulations of the
Commission thereunder (collectively the "EXCHANGE ACT"), and none of such
documents at such time contained an untrue statement of a material fact or
omitted to state a material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading; and any further documents so filed and incorporated by
reference in the Final Memorandum, when such documents are filed with the
Commission, will conform in all material respects to the requirements of
the Exchange Act, and will not contain at such time an untrue statement of
a material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading;
(d) the financial statements data, including the related notes
thereto and any supporting schedules, of the Company and its consolidated
subsidiaries and included or incorporated by reference in the Time of Sale
Information and the Final Memorandum present fairly, in all material
respects, the consolidated financial position of the Company and its
consolidated subsidiaries as of the dates indicated and the results of
their operations and the changes in their consolidated cash flows for the
periods specified; and said financial statements have been prepared in
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conformity with United States generally accepted accounting principles and
practices applied on a consistent basis, except as described in the notes
to such financial statements. No other financial statements or supporting
schedules are required to be included in the Offering Memorandum if the
Offering Memorandum were included in a registration statement filed
pursuant to the Securities Act. The other financial and statistical
information included or incorporated by reference in the Offering
Memorandum presents fairly the information included therein and has been
prepared on a basis consistent with that of the financial statements that
are included in the Offering Memorandum and the books and records of the
respective entities presented therein and, to the extent such information
is a range, projection or estimate, is based on the good faith belief and
estimates of the management of the Company;
(e) none of the Company or any of its subsidiaries has sustained
since the date of the latest audited financial statements included in the
Time of Sale Information and the Final Memorandum any material loss or
interference with its business from fire, explosion, hurricane, flood or
other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than
as set forth or contemplated in the Time of Sale Information and the Final
Memorandum; and, since the respective dates as of which information is
given in the Time of Sale Information and the Final Memorandum, there has
not been any material change, taken as a whole, in the capital stock,
including any declaration or payment of any dividends or other
distributions of any kind on or in respect of its capital stock or any
material increase in long term or short term debt of the Company and its
subsidiaries or any material adverse change, or any development involving
a prospective material adverse change, whether or not arising from
transactions in the ordinary course of business, in or affecting (i) the
general affairs, management, business, condition (financial or otherwise),
stockholders' equity, results of operations, properties or prospects of
the Company and its subsidiaries, taken as a whole; or (ii) the offering
of the Securities or consummation of any of the other transactions
contemplated by the Offering Documents (as defined below) (a "MATERIAL
ADVERSE EFFECT");
(f) the Company and each of its Subsidiaries has been duly
organized and is validly existing as a corporation or limited liability
company in good standing under the laws of its jurisdiction of
organization with all the requisite power and authority to own its
properties and conduct its business as described in the Time of Sale
Information and the Final Memorandum, and has been duly qualified as a
foreign corporation or limited liability company for the transaction of
business and is in good standing under the laws of each other jurisdiction
in which it owns or leases properties or conducts any business so as to
require such qualification, except where the failure to be so qualified or
in good standing in any such jurisdiction would not reasonably be expected
to have a Material Adverse Effect;
(g) this Agreement has been duly authorized, executed and
delivered by the Company;
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(h) the Company had, at the date indicated in the Time of Sale
Information and the Final Memorandum, a duly authorized, issued and
outstanding capitalization as set forth in the Time of Sale Information
and the Final Memorandum; all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued, are fully paid
and non-assessable and in compliance with all applicable state, federal
and foreign securities laws; such authorized capital stock of the Company
conforms as to legal matters in all material respects to the description
thereof contained in the Time of Sale Information and the Final
Memorandum; there are no outstanding options to purchase, or any rights or
warrants to subscribe for, or any securities or obligations convertible
into, or any contracts or commitments to issue or sell, any shares of
Common Stock, any shares of capital stock of any subsidiary, or any such
warrants, convertible securities or obligations (the "RELEVANT SECURITY"),
except as set forth in the Time of Sale Information and the Final
Memorandum and except for options and restricted stock granted or issued
under, or contracts or commitments pursuant to, the Company's previous or
currently existing stock incentive and other similar officer, director or
employee benefit plans;
(i) none of the transactions contemplated by this Agreement
(including, without limitation, the use of the proceeds from the sale of
the Securities) will violate or result in a violation of Section 7 of the
Exchange Act, or any regulation promulgated thereunder, including, without
limitation, Regulations T, U, and X of the Board of Governors of the
Federal Reserve System;
(j) prior to the date hereof, neither the Company nor any of its
affiliates has taken any action which is designed to or which has
constituted or which might have been expected to cause or result in
stabilization or manipulation of the price of any security of the Company
in connection with the offering of the Securities;
(k) the Securities have been duly authorized by the Company and,
when issued and delivered as provided in this Agreement and duly
authenticated pursuant to the Indenture will be duly executed,
authenticated, issued and delivered, will have been issued in compliance
with all applicable state, federal and foreign securities laws and will
constitute valid and legally binding obligations of the Company entitled
to the benefits provided by the Indenture; and the Securities will
conform, in all material respects, to the descriptions thereof in the Time
of Sale Information and the Final Memorandum;
(l) the Indenture has been duly authorized and, when executed and
delivered by the Company (assuming the authorization, execution and
delivery by the Trustee), shall constitute a valid and legally binding
instrument of the Company, enforceable against the Company in accordance
with its terms, subject as to enforcement, to bankruptcy, insolvency,
fraudulent transfer, fraudulent conveyance, moratorium, reorganization and
laws of general applicability relating to or affecting creditors' rights
and general equity principles (regardless of whether enforceability is
considered in a proceeding in equity or at law); and the Indenture
conforms, in all material respects, to the description thereof in the Time
of Sale Information and the Final Memorandum;
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(m) upon issuance and delivery of the Securities in accordance
with this Agreement and the Indenture, the Securities will be convertible
at the option of the holder thereof into shares of the Underlying
Securities in accordance with the terms of the Securities; the Underlying
Securities reserved for issuance upon conversion of the Securities have
been duly authorized and reserved and, when issued upon conversion of the
Securities in accordance with the terms of the Securities, will be validly
issued, fully paid and nonassessable, and the issuance of the Underlying
Securities will not be subject to any preemptive or similar rights;
(n) the Registration Rights Agreement has been duly authorized by
the Company and, when duly executed and delivered by the Company, shall
constitute the valid and legally binding obligation of the Company,
enforceable against the Company in accordance with its terms, subject as
to enforcement, to bankruptcy, insolvency, fraudulent transfer, fraudulent
conveyance, moratorium, reorganization and laws of general applicability
relating to or affecting creditors' rights and general equity principles
(regardless of whether enforceability is considered in a proceeding in
equity or at law); and except that rights to indemnification thereunder
may be limited by federal or state securities laws or public policy
relating thereto; and the Registration Rights Agreement will conform, in
all material respects, to the description thereof in the Time of Sale
Information and the Final Memorandum;
(o) all agreements relating to the Reorganization Transaction,
including but not limited to, the Agreement and Plan of Reorganization and
the Assignment and Assumption Agreement, have been duly authorized and,
when executed and delivered by the Company (assuming the authorization,
execution and delivery by the other parties thereto), shall constitute
valid and legally binding obligations of the Company, enforceable against
the Company in accordance with their terms, subject as to enforcement, to
bankruptcy, insolvency, fraudulent transfer, fraudulent conveyance,
moratorium, reorganization and laws of general applicability relating to
or affecting creditors' rights and general equity principles (regardless
of whether enforceability is considered in a proceeding in equity or at
law); and except that rights to indemnification thereunder may be limited
by federal or state securities laws or public policy relating thereto;
(p) the Company and its subsidiaries that are parties to the
Reorganization Transaction have duly authorized and approved all action
that is appropriate or necessary to consummate the Reorganization
Transaction, including but not limited to, adopting and ratifying
necessary resolutions and filing necessary certificates pursuant to the
agreements relating to the Reorganization Transaction or any applicable
law;
(q) none of the Company or any of its Subsidiaries is in violation
of its certificate or articles of incorporation or organization or
certificate of formation, or its bylaws or limited liability company
agreement (or other organizational documents); none of the Company or any
of its subsidiaries is in default in the performance or observance of any
material obligation, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement, lease or other agreement or
instrument to which it is a party or by which it or any of its properties
may be bound, other than such defaults in clause that individually or in
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the aggregate would not reasonably be expected to have a Material Adverse
Effect;
(r) the statements set forth in the Time of Sale Information and
the Final Memorandum under the captions "Description of Notes,"
"Description of Our Capital Stock," "Registration Rights," "Plan of
Distribution," and "Material U.S. Federal Income Tax Considerations,"
insofar as they constitute summaries of the legal matters, documents or
proceedings referred to therein, fairly present, in all material respects,
the information called for with respect to such legal matters, documents
or proceedings;
(s) other than as set forth in the Time of Sale Information and
the Final Memorandum, there are no legal or governmental proceedings
pending to which the Company or any of its subsidiaries is a party or of
which any property of the Company or any of its subsidiaries is the
subject which, if determined adversely to the Company or any of its
subsidiaries would reasonably be expected to, individually or in the
aggregate, have a Material Adverse Effect; and, to the best of the
Company's knowledge, no such proceedings have been threatened by
governmental authorities or others;
(t) none of the Company or any affiliate (as defined in Rule
501(b) of Regulation D) of the Company 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 Securities Act) which is or
will be integrated with the sale of the Securities in a manner that would
require the registration under the Securities Act of the offering
contemplated by the Time of Sale Information and the Final Memorandum;
(u) none of the Company, any affiliate of the Company or any
person acting on its or their behalf (other than the Initial Purchasers
for whom the Company makes no representation) has offered or sold the
Securities by means of any general solicitation or general advertising
within the meaning of Rule 502(c) under the Regulation D;
(v) the Securities satisfy the requirements set forth in Rule
144A(d)(3) under the Securities Act;
(w) the issue and sale of the Securities and the Underlying
Securities upon conversion of the Securities and the compliance by the
Company with all of the provisions of the Securities, the Indenture, the
Registration Rights Agreement and this Agreement (the "OFFERING
DOCUMENTS") and the consummation of the transactions herein and therein
contemplated (i) will not conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its subsidiaries is a party or
by which the Company or any of its subsidiaries is bound or to which any
of the property or assets of the Company or any of its subsidiaries is
subject, except such conflict, breach or violation as would not reasonably
be expected to have a Material Adverse Effect, (ii) will not result in any
violation of the provisions of the certificate of incorporation or
articles, bylaws, articles of organization, limited liability company
agreement or any other organizational documents of the Company or any of
its Subsidiaries, and (iii) will not result in the violation of any
statute or any order, rule or regulation of any court or governmental
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agency or body having jurisdiction over the Company or any of its
subsidiaries or any of their properties, except, in the case of (i) and
(iii) such violations as would not reasonably be expected to have a
Material Adverse Effect; and except as disclosed in the Time of Sale
Information and the Final Memorandum, no consent, approval, authorization,
order, registration or qualification of or with any such court or
governmental agency or body is required for the issue and sale of the
Securities or Underlying Securities or the consummation by the Company of
the transactions contemplated by the Offering Documents, except for the
Commission must declare a registration statement effective pursuant to the
Registration Rights Agreement, the qualification of the Indenture under
the Trust Indenture Act of 1939 ("TRUST INDENTURE ACT") in relation to the
Securities and such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky laws
in connection with the purchase and distribution of the Securities by the
Initial Purchasers in the manner contemplated by the Time of Sale
Information, the Final Offering Memorandum and the Offering Documents;
(x) the consummation of the Reorganization Transaction and the
execution and delivery by the Company of the Reorganization Transaction
agreements, and the performance of its obligations thereunder, (i) will
not conflict with or result in a breach or violation of any of the terms
or provisions of, or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument to which
the Company or any of its subsidiaries is a party or by which the Company
or any of its subsidiaries is bound or to which any of the property or
assets of the Company or any of its subsidiaries is subject, except such
conflict, breach or violation as would not reasonably be expected to have
a Material Adverse Effect, (ii) will not result in any violation of the
provisions of the certificate of incorporation or articles, bylaws,
articles of organization, limited liability company agreement or any other
organizational documents of the Company or any of its Subsidiaries and
(iii) will not result in the violation of any statute or any order, rule
or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
properties, except such violations, in the case of (i) and (iii) as would
not reasonably be expected to have a Material Adverse Effect;
(y) the Company is not and, after giving effect to the offering
and sale of the Securities and the application of the proceeds thereof as
described in the Time of Sale Information and the Final Memorandum, will
not be required to register as an "investment company" as such term is
defined in the Investment Company Act of 1940, as amended (the "INVESTMENT
COMPANY ACT");
(z) Deloitte & Touche LLP ("D&T"), who have certified the audited
consolidated financial statements of the Company and its subsidiaries as
of and for the year ended December 31, 2006, are an independent registered
public accounting firm as required under the Securities Act and the rules
and regulations adopted by the Commission and the Public Company
Accounting Oversight Board (the "PCAOB");
(aa) BDO Xxxxxxx LLP ("BDO"), who have certified the audited
consolidated financial statements of the Company and its subsidiaries as
of and for each of the two years in the period ended December 31, 2005,
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are an independent registered public accounting firm as required under the
Securities Act and the rules and regulations adopted by the Commission and
the PCAOB;
(bb) PricewaterhouseCoopers LLP ("PWC"), who have certified the
audited consolidated financial statements of Identix Incorporated and its
subsidiaries, are an independent registered public accounting firm as
required under the Securities Act and the rules and regulations adopted by
the Commission and the PCAOB;
(cc) Snyder, Cohn, Xxxxxxx, Xxxxxxxx & Associates, P.C. ("XXXXXX"),
who have certified the unaudited consolidated financial statements of
SpecTal, LLC and its subsidiaries, are independent certified public
accountants with respect to SpecTal, LLCas required under the Securities
Act and the rules and regulations of the Commission thereunder;
(dd) when the Securities are issued and delivered pursuant to this
Agreement, no Securities will be of the same class (within the meaning of
Rule 144A under the Securities Act) as securities which are listed on a
national securities exchange registered under Section 6 of the Exchange
Act, or quoted in a U.S. automated inter-dealer quotation system;
(ee) the Company is subject to Section 13 or 15(d) of the Exchange
Act and has filed in a timely manner each document or report required to
be filed by it pursuant to the Exchange Act subsequent to its quarterly
report for the period ended March 31, 2006 on Form 10-Q; each such
document or report (including any financial statements) and any amendment
thereto at the time it was filed conformed to the requirements of the
Exchange Act and the Securities Act;
(ff) the Company and its subsidiaries own or possess adequate
licenses or other rights to use all trademarks, service marks, trade names
and know-how necessary to conduct the businesses by them as described in
the Time of Sale Information and the Final Memorandum, and except as
described in the Time of Sale Information and the Final Memorandum neither
the Company nor any of its subsidiaries has received any notice of
conflict with (or knows of any such conflict with) asserted rights of
others with respect to any trademarks, service marks, trade names or
know-how which, if such assertion of conflict were sustained, would
individually or in the aggregate reasonably be expected to have a Material
Adverse Effect;
(gg) the Company and its subsidiaries possess all licenses,
permits, certificates, consents, orders, approvals and other
authorizations from, and have made all declarations and filings with, all
federal, state, local and other governmental authorities and all courts
and other tribunals, including without limitation under any applicable
Environmental Laws (as defined below), currently required or necessary to
own or lease, as the case may be, and to operate their properties and to
carry on their business as now and proposed to be conducted as set forth
in the Time of Sale Information and the Final Memorandum ("PERMITS"),
except where the failure to obtain such Permits would not individually or
in the aggregate reasonably be expected to have a Material Adverse Effect;
the Company and its subsidiaries have fulfilled and performed all of their
-12-
obligations with respect to such Permits and no event has occurred which
allows, or after notice or lapse of time would allow, revocation or
termination thereof or results in any other material impairment of the
rights of the holder of any such Permit, except where the failure to
perform such obligations or the occurrence of such event would not
reasonably be expected to have a Material Adverse Effect; and neither the
Company nor any of its subsidiaries has received any notice of any
proceeding relating to revocation or modification of any such Permit,
except as described in the Time of Sale Information and the Final
Memorandum; and except where such revocation or modification would not
individually or in the aggregate reasonably be expected to have a Material
Adverse Effect, no Permit contains a materially burdensome restriction not
adequately disclosed in the Offering Memorandum;
(hh) the Company and its Subsidiaries have filed all necessary
federal, state and foreign income and franchise tax returns or have timely
requested extensions thereof and have paid all taxes shown as due thereon
or made adequate reserve or provision therefor; and other than tax
deficiencies which the Company or any subsidiary is contesting in good
faith and for which the Company or such subsidiary has provided adequate
reserves, there is no tax deficiency that has been asserted against the
Company or any subsidiary that would individually or in the aggregate
reasonably be expected to have a Material Adverse Effect;
(ii) except as described in the Time of Sale Information and the
Final Memorandum or as would not individually or in the aggregate have a
Material Adverse Effect, (i) to the Company's knowledge, there has been no
storage, generation, transportation, handling, treatment, disposal,
discharge, emission or other release of any kind of toxic or other wastes
or other hazardous substances by, due to, or caused by the Company or any
subsidiary (or any other entity for whose acts or omissions the Company is
or may be liable) upon any other property now or previously owned or
leased by the Company or any subsidiary, or upon any other property, which
would be a violation of or give rise to any liability under any applicable
law, rule, regulation, order, judgment, decree or permit relating to
pollution or protection of the environment ("ENVIRONMENTAL LAW"); (ii) to
the Company's knowledge there has been no disposal discharge, emission or
other release of any kind onto such property of any toxic or other wastes
or other hazardous substances with respect to which the Company or any
subsidiary has knowledge; (iii) neither the Company nor any subsidiary has
agreed to assume, undertake or provide indemnification for any liability
of any other person under any Environmental Law, including any obligation
for cleanup or remedial action; and (iv) there is no pending or, to the
Company's knowledge, threatened administrative, regulatory or judicial
action, claim or notice of noncompliance or violation, investigation or
proceedings relating to any Environmental Law against the Company or any
subsidiary;
(jj) there is no strike, labor dispute, slowdown or work stoppage
with the employees of the Company or any of its subsidiaries which is
pending or, to the Company's knowledge, threatened, which could reasonably
be expected to have a Material Adverse Effect; neither the Company nor any
of its significant subsidiaries (within the meaning of Rule 405 under the
Securities Act) (the "SUBSIDIARIES") is a party to or has any obligation
-13-
under any collective bargaining agreement or other labor union contract,
white paper or side agreement with any labor union or organization; except
as described in the Time of Sale Information and the Final Memorandum, to
the Company's knowledge, no collective bargaining organizing activities
are taking place with respect to the Company or any of its Subsidiaries;
(kk) the Company and its Subsidiaries carry insurance in such
amounts and covering such risks as in their determination is adequate for
the conduct of their business or the value of their properties;
(ll) neither the Company nor any of its subsidiaries has any
liability for any prohibited transaction or funding deficiency or any
complete or partial withdrawal liability with respect to any pension,
profit sharing, 401(k) plan or other plan which is subject to the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), to which the
Company or any of its subsidiaries makes or ever has made a contribution
and in which any employee of the Company or any of its subsidiaries is or
has ever been a participant, except for such liabilities which would not
individually or in the aggregate reasonably be expected to have a Material
Adverse Effect; and with respect to such plans, the Company and each of
its subsidiaries are in compliance in all material respects with all
applicable provisions of ERISA;
(mm) the Company and each of its subsidiaries have valid rights to
lease or otherwise use, all items of real or personal property which are
material to the business of the Company and each of its subsidiaries,
taken as a whole, in each case free and clear of all liens, encumbrances
and defects, except as disclosed in the Offering Memorandum, that do not
materially affect the value of such property or materially interfere with
the use made and proposed to be made of such property by the Company or
any of its subsidiaries or could not reasonably be expected to have a
Material Adverse Effect;
(nn) the Company and its Subsidiaries maintain a system of internal
control over financial reporting (as such term is defined in Rule
13a-15(f) under the Exchange Act) that complies with the requirements of
the Exchange Act and has been designed by the Company's principal
executive officer and principal financial officer, or under their
supervision, or in the case of its Subsidiaries by each of its
Subsidiaries' principal executive officer and principal financial officer,
or under their supervision, to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or
specific authorizations, (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with United
States generally accepted accounting principles and to maintain
accountability for assets, (iii) access to assets is permitted only in
accordance with management's general or specific authorization and (iv)
the recorded accounting for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences. The Company's internal control over financial reporting is
effective, and the Company is not aware of any material weaknesses in its
internal control over financial reporting;
(oo) since the date of the filing of the Company's Annual Report on
Form 10-K for the year ended December 31, 2006, the Company's auditors and
the audit committee of the board of directors of the Company (or persons
-14-
fulfilling the equivalent function) have not been advised of (i) any
significant deficiencies in the design or operation of internal controls
which adversely affect the Company's ability to record, process, summarize
and report financial data nor any material weaknesses in internal controls
and (ii) fraud, whether or not material, that involves management or other
employees who have a significant role in the Company's internal controls;
(pp) since the date of the filing of the Company's Annual Report on
Form 10-K for the year ended December 31, 2006, there have been no
significant changes in internal controls or in other factors that could
materially affect internal controls, including any corrective actions with
regard to significant deficiencies;
(qq) the Company maintains disclosure controls and procedures (as
such term is defined in Rule 13a-15(e) under the Exchange Act) that comply
with the requirements of the Exchange Act; such disclosure controls and
procedures have been designed to ensure that material information relating
to the Company and its subsidiaries is made known to the Company's
principal executive officer and principal financial officer by others
within those entities; and such disclosure controls and procedures are
effective;
(rr) the statistical, industry-related and market-related data
included in the Final Memorandum are based on or derived from sources
which the Company reasonably and in good faith believes are reliable and
accurate;
(ss) the pro forma financial information included or incorporated
by reference in the Time of Sale Information and the Final Memorandum has
been prepared on a basis consistent with the financial statements from
which it has been derived, includes all material adjustments to the
financial information required by Rule 11-02 of Regulation S-X under the
Exchange Act to reflect the transactions described in the Time of Sale
Information and the Final Memorandum, gives effect to assumptions made on
a reasonable basis and fairly presents the transactions described in Time
of Sale Information and the Final Memorandum;
(tt) there are no material business relationships or related party
transactions involving the Company or any subsidiary or any other person
which is required by the Exchange Act to be described in the Company's
annual and/or quarterly reports on Form 10-K and 10-Q, as applicable, that
have not been described in the Time of Sale Information and the Final
Memorandum;
(uu) there is and has been no failure on the part of the Company or
any of its directors or officers, in their capacities as such, to comply
with any provision of the Xxxxxxxx-Xxxxx Act of 2002 and the rules and
regulations promulgated in connection therewith, including, without
limitation, Section 402 related to loans and Sections 302 and 906 related
to certifications;
(vv) the certificates for the Underlying Securities conform to the
requirements of the New York Stock Exchange and the Delaware General
Corporation Law;
-15-
(ww) neither the Company nor any of its subsidiaries nor, to the
Company's knowledge, any officer or director purporting to act on behalf
of the Company or any of its subsidiaries has at any time during the last
five years (i) made any contributions to any candidate for political
office, or failed to disclose fully any such contributions, in violation
of law, (ii) made any payment to any state, federal or foreign
governmental officer or official, or other person charged with similar
public or quasi-public duties, other than payments required or allowed by
applicable law, (iii) made any payment outside the ordinary course of
business to any executive, financial, security or technology officer or
person charged with similar duties of any entity with which the Company or
any of its subsidiaries does business for the purpose of influencing such
person to transaction business with the Company or any of its subsidiaries
or (iv) engaged in any transactions, maintained any bank account or used
any corporate funds except for transactions, bank accounts and funds which
have been and are reflected in the normally maintained books and records
of the Company and its subsidiaries. The operations of the Company and
each Subsidiary are and, to the Company's knowledge, have been conducted
at all times in compliance with applicable financial record-keeping and
reporting requirements of the Currency and Foreign Transactions Reporting
Act of 1970, as amended, the money laundering statutes of all applicable
jurisdictions, the rules and regulations thereunder and any related or
similar rules, regulations or guidelines issued, administered or enforced
by any governmental agency (collectively, the "MONEY LAUNDERING LAWS") and
no action, suit or proceeding by or before any court or governmental
agency, authority or body or any arbitrator involving the Company or any
subsidiary with respect to the Money Laundering Laws is pending or, to the
best knowledge of the Company, threatened. Neither the Company nor any
subsidiary nor, to the knowledge of the Company, any director, officer,
agent, employee or affiliate of the Company or any subsidiary is currently
subject to any U.S. sanctions administered by the Office of Foreign Assets
Control of the U.S. Treasury Department ("OFAC"); and the Company will not
directly or indirectly use the proceeds of the offering, or lend,
contribute or otherwise make available such proceeds to any subsidiary,
joint venture partner or other person or entity, for the purpose of
financing the activities of any person currently subject to any U.S.
sanctions administered by OFAC;
(xx) the subsidiaries listed in Schedule IV hereto are the only
subsidiaries of the Company within the meaning of Rule 405 under the
Securities Act. Except for the subsidiaries, the Company holds no
ownership or other interest, nominal or beneficial, direct or indirect, in
any corporation, partnership, joint venture or other business entity. All
of the issued shares of capital stock of or other ownership interests in
each subsidiary have been duly and validly authorized and issued and are
fully paid and non-assessable and are owned directly or indirectly by the
Company, except as discussed in the Time of Sale Information and the Final
Memorandum, free and clear of any lien, charge, mortgage, pledge, security
interest, claim, equity, trust or other encumbrance, preferential
arrangement, defect or restriction of any kind whatsoever; and
(yy) no event or circumstance has occurred or arisen that could
reasonably be expected to give rise to a requirement that the Company make
additional disclosure on Form 8-K and has not been so disclosed.
-16-
5. Covenants of the Company. The Company covenants and agrees with each
of the several Initial Purchasers as follows:
(a) the Company will deliver to the Initial Purchasers as many
copies of the Final Memorandum (including all amendments and supplements
thereto) as the Initial Purchasers may reasonably request;
(b) before distributing any amendment or supplement to the Time of
Sale Information or the Final Memorandum, the Company will furnish to the
Initial Purchasers a copy of the proposed amendment or supplement for
review and not to distribute any such proposed amendment or supplement to
which the Initial Purchasers reasonably disapprove after reasonable notice
thereof;
(c) if, at any time prior to the completion of the initial
placement of the Securities by the Initial Purchasers, any event shall
occur as a result of which it is necessary in the opinion of the Initial
Purchasers to amend or supplement the Time of Sale Information or the
Final Memorandum in order that the Time of Sale Information or the Final
Memorandum will not include an 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 when the Time of Sale
Information or the Final Memorandum is delivered to a purchaser, not
misleading, or if it is necessary to amend or supplement the Time of Sale
Information or the Final Memorandum to comply with law, the Company will
forthwith prepare and furnish, at the expense of the Company, to the
Initial Purchasers and to the dealers (whose names and addresses the
Initial Purchasers will furnish to the Company) to which Securities may
have been sold by the Initial Purchasers on behalf of the Initial
Purchasers and to any other dealers upon request, such amendments or
supplements to the Time of Sale Information or the Final Memorandum as may
be necessary to correct such untrue statement or omission or so that the
statements in the Time of Sale Information or the Final Memorandum as so
amended or supplemented will comply with applicable law;
(d) the Company will endeavor to qualify the Securities for offer
and sale under the securities or Blue Sky laws of such jurisdictions as
the Initial Purchasers shall reasonably request and to continue such
qualification in effect so long as reasonably required for distribution of
the Securities and to pay all fees and expenses (including fees and
disbursements of counsel to the Initial Purchasers) reasonably incurred in
connection with such qualification and in connection with the
determination of the eligibility of the Securities for investment under
the laws of such jurisdictions as the Initial Purchasers may designate;
provided that the Company shall not be required to file a general consent
to service of process in any jurisdiction or to qualify as a foreign
corporation or limited liability company in any jurisdiction in which it
is not so qualified;
(e) without the prior written consent of Bear, Xxxxxxx & Co. Inc.
the Company will not, during the period ending 90 days after the date of
the Final Memorandum (the "LOCK-UP PERIOD"), (i) 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, lend, or otherwise transfer or dispose of, directly or
indirectly, any shares of Common Stock or any securities convertible into
-17-
or exercisable or exchangeable for Common Stock, (ii) establish or
increase any "put equivalent position" or liquidate or decrease any "call
equivalent position" (in each case within the meaning of Section 16 of the
Exchange Act and the rules and regulations promulgated thereunder) with
respect to any Relevant Security, (iii) enter into any swap or other
arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of the Common Stock or (iv) file with
the Commission a registration statement under the Securities Act relating
to any additional shares of Common Stock or securities convertible into,
or exchangeable for, any shares of Common Stock, or publicly disclose the
intention to effect any transaction described in clause (i), (ii) or
(iii), whether any such transaction described in clause (i), (ii) or (iii)
above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise; provided that the foregoing shall not
apply to (A) the sale of the Securities under this Agreement or the
issuance of the Underlying Securities, (B) the issuance by the Company of
any shares of Common Stock upon the exercise of an option or upon the sale
by the Company of shares of Common Stock pursuant to any of the Company's
existing employee, management or other stock incentive or compensation
plans, (C) the conversion or exchange of a security outstanding on the
date hereof, and (D) the filing of any registration statement in respect
of the Securities and the Underlying Securities pursuant to the
Registration Rights Agreement;
(f) the Company will use the net proceeds received by the Company
from the sale of the Securities pursuant to this Agreement in the manner
specified in the Time of Sale Information and the Final Memorandum under
the caption "Use of Proceeds";
(g) the Company will use commercially reasonable efforts to have
the Underlying Securities listed on the New York Stock Exchange as
promptly as practicable but in no event later than the time that the
Registration Statement is declared effective in accordance with the
Registration Rights Agreement;
(h) during the period from the Closing Date until two years after
the Closing Date, or the Option Closing Date, if applicable, without the
prior written consent of the Representatives, the Company will not, and
will not permit any of its "affiliates" (as defined in Rule 144 under the
Securities Act) to, resell any of the Securities or Underlying Securities
which constitute "restricted securities" under Rule 144 that have been
reacquired by any of them;
(i) whether or not the transactions contemplated in this Agreement
are consummated or this Agreement is terminated, the Company agrees to pay
the following costs and expenses and all other costs and expenses incident
to the performance by the Company of its obligations hereunder: (i) the
negotiation, preparation, printing, typing, reproduction, execution and
delivery of this Agreement and of the other Offering Documents, any
amendment or supplement to or modification of any of the foregoing and any
and all other documents furnished pursuant hereto or thereto or in
connection herewith or therewith; (ii) the preparation, printing or
reproduction of each Preliminary Offering Memorandum, the Offering
Memorandum and each amendment or supplement to any of them; (iii) the
delivery (including postage, air freight charges and charges for counting
-18-
and packaging) of such copies of each Preliminary Offering Memorandum, the
Offering Memorandum and all amendments or supplements to any of them as
may be reasonably requested for use in connection with the offering and
sale of the Securities; (iv) the preparation, printing, authentication,
issuance and delivery of certificates for the Securities and the
Underlying Securities, including any stamp taxes in connection with the
original issuance and sale of the Securities and trustees' fees; (v) the
reproduction and delivery of this Agreement and the other Offering
Documents, the preliminary and supplemental "Blue Sky" memoranda and all
other agreements or documents reproduced and delivered in connection with
the offering of the Securities; (vi) the registration or qualification of
the Securities for offer and sale under the securities or Blue Sky laws of
the several states (including filing fees and the reasonable fees,
expenses and disbursements of counsel to the Initial Purchasers relating
to such registration and qualification); (vii) the transportation and
other expenses incurred by or on behalf of Company representatives in
connection with presentations to and related communications with
prospective purchasers of the Securities; (viii) the fees and expenses of
the Company's accountants and the fees and expenses of counsel (including
local and special counsel, if any) for the Company; (ix) fees and expenses
of the Trustee including fees and expenses of its counsel; (x) all
expenses and listing fees incurred in connection with the application for
quotation of the Securities on the PORTAL Market; (xi) all expenses and
listing fees incurred in connection with the application for listing for
quotation of the Underlying Securities on the New York Stock Exchange;
(xii) all expenses incurred in connection with the performance of the
Company's obligations under the Registration Rights Agreement; and (xiii)
any fees charged by investment rating agencies for the rating of the
Securities;
(j) the Company shall not be or become, at any time prior to the
expiration of two years after the Closing Date, an open-end investment
company, unit investment trust, closed-end investment company or
face-amount certificate company that is or is required to be registered
under Section 8 of the Investment Company Act;
(k) while the Securities remain outstanding and are "restricted
securities" within the meaning of Rule 144(a)(3) under the Securities Act,
the Company will, during any period in which it is not subject to Section
13 or 15(d) under the Exchange Act, make available to the purchasers and
any holder of Securities in connection with any sale thereof and any
prospective purchaser of Securities and securities analysts, in each case
upon request, the information specified in, and meeting the requirements
of, Rule 144A(d)(4) under the Securities Act (or any successor thereto);
(l) none of the Company, any of its Subsidiaries or any of its
affiliates (as defined in Rule 501(b) under the Securities Act) will take
any action prohibited by Regulation M under the Exchange Act, in
connection with the distribution of the Securities contemplated hereby;
(m) none of the Company or any of its affiliates (as defined in
Rule 501(b) under the Securities Act) or any person acting on behalf of
the Company will solicit any offer to buy or offer or sell the Securities
or the Underlying Securities by means of any form of general solicitation
or general advertising within the meaning of Regulation D, including: (i)
-19-
any advertisement, article, notice or other communication published in any
newspaper, magazine or similar medium or broadcast over television or
radio; and (ii) any seminar or meeting whose attendees have been invited
by any general solicitation or general advertising;
(n) none of the Company or any of its affiliates (as defined in
Rule 501(b) under the Securities Act) or any person acting on behalf of
the Company will sell, offer for sale or solicit offers to buy or
otherwise negotiate in respect of any security (as defined in the
Securities Act) which will be integrated with the sale of the Securities
or the Underlying Securities in a manner which would require the
registration under the Securities Act of the Securities or Underlying
Securities, and the Company will take all action that is appropriate or
necessary to assure that its offerings of other securities will not be
integrated for purposes of the Securities Act with the offering
contemplated hereby;
(o) prior to any registration of the Securities pursuant to the
Registration Rights Agreement, or at such earlier time as may be so
required, to qualify the Indenture under the Trust Indenture Act, and to
enter into any necessary supplemental indentures in connection therewith;
(p) the Company will use its commercially reasonable efforts to
cause the Securities to be eligible for trading on PORTAL;
(q) the Company will reserve and keep available at all times, free
of pre-emptive rights, shares of Common Stock for the purpose of enabling
the Company to satisfy all obligations to issue the Underlying Securities
upon any conversion of the Securities;
(r) except for such documents that are publicly available on the
Commission's Electronic Data Gathering, Analysis and Retrieval system
("XXXXX"), the Company shall furnish to the holders of the Securities as
soon as practicable after the end of each fiscal year an annual report
(including a balance sheet and statements of income, stockholders' equity
and cash flows of the Company and its consolidated subsidiaries certified
by independent public accountants) and, as soon as practicable after the
end of each of the first three quarters of each fiscal year (beginning
with the fiscal quarter ending after the date of the Final Memorandum), to
make available to its security holders consolidated summary financial
information of the Company and its subsidiaries for such quarter in
reasonable detail;
(s) during a period of five years from the date of the Final
Memorandum, except for such documents that are publicly available on
XXXXX, the Company shall furnish to you copies of all reports or other
written communications (financial or other) furnished to stockholders of
the Company, and deliver to you as soon as they are available, copies of
any reports and financial statements furnished to or filed with the
Commission or any securities exchange on which the Securities, or any
class of securities of the Company is listed; and such additional
information concerning the business and financial condition of the Company
as you may from time to time reasonably request (such financial statements
-20-
to be on a consolidated basis to the extent the accounts of the Company
and its subsidiaries are consolidated in reports furnished to its
stockholders generally or to the Commission); and
(t) the Company shall advise the Initial Purchasers promptly, and,
if requested by the Initial Purchasers, confirm such advice in writing, of
the issuance by any state securities commission of any stop order
suspending the qualification or exemption of any of the Securities for
offering or sale in any jurisdiction, or the initiation of any proceeding
for such purpose by any state securities commission or other regulatory
authority, and shall use their reasonable best efforts to prevent the
issuance of any stop order or order suspending the qualification or
exemption of any of the Securities under any state securities or Blue Sky
laws, and if, at any time, any state securities commission or other
regulatory authority shall issue an order suspending the qualification or
exemption of any of the Securities under any state securities or Blue Sky
laws, the Company shall use its reasonable best efforts to obtain the
withdrawal or lifting of such order at the earliest possible time.
6. Conditions to the Initial Purchasers' Obligations. The several
obligations of the Initial Purchasers hereunder to purchase the Firm Securities
on the Closing Date are subject to the performance by the Company of its
obligations hereunder and to the following additional conditions:
(a) the representations and warranties of the Company contained
herein are true and correct on and as of the Closing Date as if made on
and as of the Closing Date and the Company shall have complied with all
agreements and all conditions on its part to be performed or satisfied
hereunder at or prior to the Closing Date;
(b) on or after the date hereof no downgrading shall have occurred
in the rating accorded the Company's debt securities by any "nationally
recognized statistical rating organization," as that term is defined by
the Commission for purposes of Rule 436(g)(2) under the Securities Act;
(c) (i) none of the Company, nor any of its subsidiaries shall
have sustained since the date of the latest audited financial statements
included in the Time of Sale Information any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental
action, order or decree, otherwise than as set forth or contemplated in
the Time of Sale Information that would reasonably expected to have a
Material Adverse Effect, and (ii) since the respective dates as of which
information is given in the Time of Sale Information (excluding any
amendment or supplement thereto after the date hereof), there shall not
have been (A) any change in the capital stock or long-term debt of the
Company or any of its subsidiaries or any change, or any development
involving a prospective change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, taken as a whole,
otherwise than as set forth or contemplated in the Time of Sale
Information, or (B) any suspension or material limitation of trading in
the capital stock of the Company on the New York Stock Exchange, the
effect of which, in any case described in clause (i) or (ii), in the
-21-
judgment of the Representatives makes it impracticable or inadvisable to
proceed with the offering or the delivery of the Securities on the Closing
Date on the terms and in the manner contemplated in the Time of Sale
Information and the Final Memorandum;
(d) the Initial Purchasers shall have received on and as of the
Closing Date a certificate of an executive officer of the Company, with
specific knowledge about the Company's financial matters, satisfactory to
the Initial Purchasers to the effect set forth in Sections 6(a), 6(b) and
6(c);
(e) Weil, Gotshal & Xxxxxx LLP, outside counsel for the Company,
shall have furnished to the Initial Purchasers its written opinion and its
letter, each dated the Closing Date, in form and substance satisfactory to
the Initial Purchasers, substantially in the forms of Exhibits B-1 and B-2
hereto;
(f) on the date hereof and also on the Closing Date, D&T shall
have furnished to the Initial Purchasers letters, dated the respective
dates of delivery thereof, in form and substance reasonably satisfactory
to the Initial Purchasers, containing statements and information of the
type customarily included in accountants "comfort letters" to initial
purchasers with respect to the financial statements and certain financial
information contained in the Offering Memorandum;
(g) on the date hereof and also on the Closing Date, BDO shall
have furnished to the Initial Purchasers letters, dated the respective
dates of delivery thereof, in form and substance reasonably satisfactory
to the Initial Purchasers, containing statements and information of the
type customarily included in accountants "comfort letters" to initial
purchasers with respect to the financial statements and certain financial
information contained in the Offering Memorandum;
(h) on the date hereof and also on the Closing Date, PwC shall
have furnished to the Initial Purchasers letters, dated the respective
dates of delivery thereof, in form and substance reasonably satisfactory
to the Initial Purchasers, containing statements and information of the
type customarily included in accountants "comfort letters" to initial
purchasers with respect to the financial statements and certain financial
information contained in the Offering Memorandum;
(i) on the date hereof and also on the Closing Date, Xxxxxx shall
have furnished to the Initial Purchasers letters, dated the respective
dates of delivery thereof, in form and substance reasonably satisfactory
to the Initial Purchasers, containing statements and information of the
type customarily included in accountants "comfort letters" to initial
purchasers with respect to the financial statements and certain financial
information contained in the Offering Memorandum;
(j) Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, counsel to the
Initial Purchasers, shall have furnished to the Initial Purchasers their
written opinion, dated the Closing Date, in form and substance
satisfactory to the Initial Purchasers;
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(k) the "lock-up" agreements, each substantially in the form of
Exhibit A hereto, between you and the officers and directors of the
Company and other persons identified on Exhibit A-1 relating to sales and
certain other dispositions of shares of Common Stock or certain other
securities of the Company, shall have been delivered to you on or before
the date hereof and shall be in full force and effect;
(l) the Securities shall have been approved for trading on PORTAL,
subject only to notice of issuance at or prior to the time of purchase;
(m) the Initial Purchasers shall have received a counterpart of
the Registration Rights Agreement that shall have been executed and
delivered by a duly authorized officer of the Company;
(n) on or prior to the Closing Date the Company shall have
furnished to the Initial Purchasers such further certificates and
documents as the Initial Purchasers or their counsel shall reasonably
request;
(o) on or after the date hereof there shall not have occurred any
of the following: (i) trading generally shall have been suspended or
materially limited on or by the New York Stock Exchange, (ii) trading of
any securities of or guaranteed by the Company shall have been suspended
on any exchange or in any over the counter market, (iii) a general
moratorium on commercial banking activities shall have been declared by
either Federal or New York State authorities, (iv) the outbreak or
escalation of hostilities involving the United States or the declaration
by the United States of a national emergency or war or (v) the occurrence
of any other calamity or crisis or any change in financial, political or
economic conditions in the United States or elsewhere, if the effect of
any such event specified in clause (iv) or (v) in the judgment of the
Representatives, makes it impracticable or inadvisable to proceed with the
offering or the delivery of the Securities being issued at such Closing
Date on the terms and in the manner contemplated in the Time of Sale
Information or to enforce contracts for the sale of the Securities; and
(p) the Company shall have obtained approval from the NYSE to list
its shares on the NYSE and the Reorganization Transaction shall have been
consummated in all respects.
The obligations of the Initial Purchasers to purchase Additional
Securities hereunder are subject to the delivery to you on the Option Closing
Date of such documents as you may reasonably request, including the due
authorization, execution, authentication and issuance of the Additional
Securities and other matters related to the execution, authentication and
issuance of the Additional Securities.
7. Indemnification and Contribution.
(a) The Company shall indemnify and hold harmless each Initial
Purchaser and each person, if any, who controls any Initial Purchaser
within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act, and each affiliate of any Initial Purchaser within the
meaning of Rule 405 under the Securities Act from and against any and all
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losses, liabilities, claims, damages and expenses whatsoever as incurred
(including but not limited to attorneys' fees and any and all expenses
whatsoever incurred in investigating, preparing or defending against any
litigation, commenced or threatened, or any claim whatsoever, and any and
all amounts paid in settlement of any claim or litigation), joint or
several, to which they or any of them may become subject under the
Securities Act, the Exchange Act or otherwise, insofar as such losses,
liabilities, claims, damages or expenses (or actions in respect thereof)
arise out of or are based upon (i) any untrue statement or alleged untrue
statement of any material fact contained in the Time of Sale Information
or the Final Memorandum (in each case, including the Incorporated
Documents therein), or any amendment or supplement thereto, or in the
materials and information set forth on Schedule III hereto (such materials
and information set forth in Schedule III, "MARKETING MATERIALS"); or (ii)
the omission or alleged omission to state, in the Time of Sale Information
or the Final Memorandum (in each case, including the Incorporated
Documents therein) or any amendment or supplement thereto, or in any
Marketing Materials, a material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading; provided, however, that the Company will not be liable in any
such case to the extent but only to the extent that any such loss,
liability, claim, damage or expense arises out of or is based upon any
such untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with written
information furnished to the Company by or on behalf of any Initial
Purchaser through Bear Xxxxxxx expressly for use therein. The parties
agree that such information provided by or on behalf of any Initial
Purchaser through Bear Xxxxxxx consists solely of the material referred to
in Section 16 hereof. This indemnity agreement will be in addition to any
liability which the Company may otherwise have, including but not limited
to other liability under this Agreement.
(b) Each Initial Purchaser, severally and not jointly, shall
indemnify and hold harmless the Company and its respective directors,
officers and each person, if any, who controls the Company within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act, against any losses, liabilities, claims, damages and expenses
whatsoever as incurred (including but not limited to attorneys' fees and
any and all expenses whatsoever incurred in investigating, preparing or
defending against any litigation, commenced or threatened, or any claim
whatsoever, and any and all amounts paid in settlement of any claim or
litigation), joint or several, to which they or any of them may become
subject under the Securities Act, the Exchange Act or otherwise, insofar
as such losses, liabilities, claims, damages or expenses (or actions in
respect thereof) arise out of or are based upon (i) any untrue statement
or alleged untrue statement of any material fact contained in the Time of
Sale Information or the Final Memorandum or any amendment or supplement
thereto, or in any Marketing Materials, or (ii) the omission or the
alleged omission to state, in the Time of Sale Information or the Final
Memorandum or any amendment or supplement thereto, or in any Marketing
Materials, a material fact or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading,
in each case to the extent, but only to the extent, that any such loss,
liability, claim, damage or expense arises out of or is based upon any
such untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with information
-24-
furnished in writing to the Company by or on behalf of any Initial
Purchaser through Bear Xxxxxxx specifically for use therein. The parties
agree that such information provided by or on behalf of any Initial
Purchaser through Bear Xxxxxxx consists solely of the material referred to
in Section 16 hereof.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of any claims or the commencement of
any action, such indemnified party shall, if a claim in respect thereof is
to be made against the indemnifying party under such subsection, notify
each party against whom indemnification is to be sought in writing of the
claim or the commencement thereof (but the failure so to notify an
indemnifying party shall not relieve the indemnifying party from any
liability which it may have under this Section 7 to the extent that it is
not materially prejudiced as a result thereof, and in any event shall not
relieve it from any liability that such indemnifying party may have
otherwise than on account of the indemnity agreement hereunder). In case
any such claim or action is brought against any indemnified party, and it
notifies an indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate, at its own expense in
the defense of such action, and to the extent it may elect by written
notice delivered to the indemnified party promptly after receiving the
aforesaid notice from such indemnified party to assume the defense thereof
with counsel reasonably satisfactory to such indemnified party.
Notwithstanding the foregoing, the indemnified party or parties shall have
the right to employ its or their own counsel in any such case, but the
fees and expenses of such counsel shall be at the expense of such
indemnified party or parties unless (i) the employment of such counsel
shall have been authorized in writing by one of the indemnifying parties
in connection with the defense of such action, (ii) the indemnifying
parties shall not have employed counsel to have charge of the defense of
such action within a reasonable time after notice of commencement of the
action, or (iii) such indemnified party or parties shall have reasonably
and in good faith concluded that there may be defenses available to it or
them which are different from or additional to those available to one or
all of the indemnifying parties (in which case the indemnifying parties
shall not have the right to direct the defense of such action on behalf of
the indemnified party or parties), in any of which events such fees and
expenses shall be borne by the indemnifying parties. No indemnifying party
shall, without the prior written consent of the indemnified parties,
effect any settlement or compromise of, or consent to the entry of
judgment with respect to, any pending or threatened claim, investigation,
action or proceeding in respect of which indemnity or contribution may be
or could have been sought by an indemnified party under this Section 7
(whether or not the indemnified party is an actual or potential party
thereto), unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability arising
out of such claim, investigation, action or proceeding and (ii) does not
include a statement as to or an admission of fault, culpability or any
failure to act, by or on behalf of the indemnified party.
(d) In order to provide for contribution in circumstances in which
the indemnification provided for in this Section 7 is for any reason held
to be unavailable from any indemnifying party or is insufficient to hold
harmless a party indemnified hereunder, the Company and the Initial
Purchasers shall contribute to the aggregate losses, claims, damages,
liabilities and expenses of the nature contemplated by such
indemnification provision (including any investigation, legal and other
expenses incurred in connection with, and any amount paid in settlement
of, any action, suit or proceeding or any claims asserted, but after
deducting in the case of losses, claims, damages, liabilities and expenses
suffered by the Company, any contribution received by the Company from
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persons, other than the Initial Purchasers, who may also be liable for
contribution, including persons who control the Company within the meaning
of Section 15 of the Securities Act or Section 20 of the Exchange Act), as
incurred to which the Company and one or more of the Initial Purchasers
may be subject, in such proportions as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Initial
Purchasers on the other from the Offering or, if such allocation is not
permitted by applicable law, in such proportions as are appropriate to
reflect not only the relative benefits referred to above but also the
relative fault of the Company on the one hand and the Initial Purchasers
on the other in connection with the statements or omissions which resulted
in such losses, claims, damages, liabilities or expenses, as well as any
other relevant equitable considerations. The relative benefits received by
the Company on the one hand and the Initial Purchasers on the other shall
be deemed to be in the same proportion as (x) the total proceeds from the
Offering (net of underwriting discounts and commissions but before
deducting expenses) received by the Company bears to (y) the underwriting
discount or commissions received by the Initial Purchasers. The relative
fault of each of the Company and of the Initial Purchasers shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Company on the one hand or the Initial Purchasers on the other and the
parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. The Company and the
Initial Purchasers further 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 Initial Purchasers 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.
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 judicial,
regulatory or other legal or 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, (i) no Initial Purchaser shall be required
to contribute any amount in excess of the amount by which the discounts
and commissions applicable to the Securities purchased by it and
distributed to the public exceeds the amount of any damages which such
Initial Purchaser has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission and
(ii) no person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) 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
Initial Purchaser within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act and each affiliate of any Initial
Purchaser within the meaning of Rule 405 under the Securities Act shall
-26-
have the same rights to contribution as such Initial Purchaser, and each
person, if any, who controls the Company within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act, shall have the
same rights to contribution as the Company, as applicable, subject in each
case to clauses (i) and (ii) of the immediately preceding sentence. Any
party entitled to contribution will, promptly after receipt of notice of
commencement of any action, suit or proceeding against such party in
respect of which a claim for contribution may be made against another
party or parties, notify each party or parties from whom contribution may
be sought, but the omission to so notify such party or parties shall not
relieve the party or parties from whom contribution may be sought from any
obligation it or they may have under this Section 7 or otherwise. The
obligations of the Initial Purchasers to contribute pursuant to this
Section 7 are several in proportion to the respective number of Securities
to be purchased by each of the Initial Purchasers hereunder and not joint.
8. Effectiveness; Defaulting Initial Purchasers. This Agreement shall
become effective upon the execution and delivery hereof by the parties hereto.
If, on the Closing Date any one or more of the Initial Purchasers shall
fail or refuse to purchase Securities which it or they have agreed to purchase
hereunder on such date, and the aggregate principal amount of Securities which
such defaulting Initial Purchaser or Initial Purchasers agreed but failed or
refused to purchase is not more than one-tenth of the aggregate principal amount
of the Securities to be purchased on such date, the other Initial Purchasers
shall be obligated severally in the proportions that the principal amount of
Securities set forth opposite their respective names in Schedule I (in the
column titled "Total") bears to the aggregate principal amount of Securities set
forth opposite the names of all such non-defaulting Initial Purchasers (in the
column titled "Total"), or in such other proportions as the Initial Purchasers
may specify, to purchase the Securities which such defaulting Initial Purchaser
or Initial Purchasers agreed but failed or refused to purchase on such date;
provided that in no event shall the principal amount of Securities that any
Initial Purchaser has agreed to purchase pursuant to Section 1 be increased
pursuant to this Section 8 by an amount in excess of one-tenth of such principal
amount of Securities without the written consent of such Initial Purchaser. If,
on the Closing Date any Initial Purchaser or Initial Purchasers shall fail or
refuse to purchase Securities which it or they have agreed to purchase hereunder
on such date, and the aggregate principal amount of Securities with respect to
which such default occurs is more than one-tenth of the aggregate principal
amount of Securities to be purchased on such date, and arrangements satisfactory
to the Initial Purchasers and the Company for the purchase of such Securities
are not made within 36 hours after such default, this Agreement shall terminate
without liability on the part of any non-defaulting Initial Purchaser or the
Company. In any such case either the Initial Purchasers or the Company shall
have the right to postpone the Closing Date, but in no event for longer than
seven days, in order that the required changes, if any, in the Final Memorandum
or in any other documents or arrangements may be effected. Any action taken
under this paragraph shall not relieve any defaulting Initial Purchaser from
liability in respect of any default of such Initial Purchaser under this
Agreement.
9. Reimbursement. If the transactions contemplated by this Agreement
shall fail to close because of a condition not being met because of any failure
or refusal on the part of the Company to comply with the terms or to fulfill any
of the conditions of this Agreement or if for any reason the Company shall be
-27-
unable to perform its obligations under this Agreement or any condition of the
Initial Purchasers' obligations (other than those conditions set forth in
Sections 6(o)(i) or (iii) through (v)) cannot be fulfilled or if the
Reorganization Transaction shall not have been consummated on or before May 17,
2007, the Company agrees to reimburse the Initial Purchasers or such Initial
Purchasers as have so terminated this Agreement with respect to themselves,
severally, for all out of pocket expenses (including the reasonable fees and
expenses of their counsel) incurred by such Initial Purchasers in connection
with this Agreement or the offering contemplated hereunder.
10. Parties. This Agreement shall inure to the benefit of and be binding
upon each Initial Purchaser and the Company and their respective successors and
assigns, and nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any other person any legal or equitable right, remedy
or claim under or in respect of this Agreement, or any provisions herein
contained; this Agreement and all conditions and provisions hereof being
intended to be and being for the sole and exclusive benefit of such persons and
for the benefit of no other person except that (i) the indemnities of the
Company contained in Section 7 of this Agreement shall also be for the benefit
of any person or persons who control the Initial Purchasers within the meaning
of Section 15 of the Securities Act or Section 20 of the Exchange Act and (ii)
the indemnities of the Initial Purchasers contained in Section 7 of this
Agreement shall also be for the benefit of the directors of any person or
persons who controls the Company within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act. No purchaser of Securities
from the Initial Purchasers will be deemed a successor because of such purchase
11. Notices. Any action by the Initial Purchasers hereunder may be taken
by the Representatives on behalf of the Initial Purchasers, and any such action
taken by the Representatives shall be binding upon the Initial Purchasers. 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 Initial Purchasers shall be given to the
Initial Purchasers x/x Xxxx, Xxxxxxx & Xx. Xxx., 000 Xxxxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attn: General Counsel. Notices to the Company shall be given to
them at 000 Xxxxx Xxxxxx, Xxxxxxxx, Xxxxxxxxxxx 00000, Attn: General Counsel.
12. Survival of Representations and Indemnities. The representations and
warranties, covenants, indemnities and contribution and expense reimbursement
provisions and other agreements, representations and warranties of the Company
set forth in or made pursuant to this Agreement shall remain operative and in
full force and effect, and will survive, regardless of (i) any investigation, or
statement as to the results thereof, made by or on behalf of the Company, any of
its officers or directors, Initial Purchasers and (ii) acceptance of the
Securities, and payment for them hereunder, and shall be binding upon and shall
inure to the benefit of, any successors, assigns, heirs, personal
representatives of the Company, the Initial Purchasers and indemnified parties
referred to in Section 7 hereof. The respective agreements, covenants,
indemnities and other statements set forth in Sections 5(i), 7, 9, 12 and 13
hereof shall remain in full force and effect, regardless of any termination or
cancellation of this Agreement.
13. Termination. (a) This Agreement may be terminated in the sole
discretion of the Initial Purchasers by notice to the Company given in the event
that the Company has failed, refused or been unable to satisfy all conditions on
-28-
its part to be performed or satisfied hereunder on or prior to the Closing Date
or if, at or prior to the Closing Date or at or prior to the Option Closing
Date, as the case may be:
(i) any domestic or international event or act or occurrence
has materially disrupted, or in the opinion of the Initial
Purchasers will in the immediate future materially disrupt, the
market for the Company's securities or securities in general;
(ii) trading generally shall have been suspended or
materially limited on or by the New York Stock Exchange;
(iii) a general moratorium on commercial banking activities
shall have been declared by either Federal or New York State
authorities;
(iv) (A) the outbreak or escalation of hostilities involving
the United States or the declaration by the United States of a
national emergency or war or (B) the occurrence of any other
calamity or crisis or any change in financial, political or economic
conditions in the United States or elsewhere, if the effect of any
such event specified in clause (A) or (B) in the judgment of the
Initial Purchasers makes it impracticable or inadvisable to proceed
with the offering or the delivery of the Securities being issued at
such Closing Date on the terms and in the manner contemplated in the
Time of Sale Information or to enforce contracts for the sale of the
Securities; or
(v) any debt securities of the Company shall have been
downgraded or placed on any "watch list" for possible downgrading by
any "nationally recognized statistical rating organization" as
defined for purposes of Rule 436(g) under the Securities Act.
(b) Subject to paragraph (c) below, termination of this Agreement
pursuant to this Section 13 shall be without liability of any party to any
other party except as provided in Section 12 hereof.
(c) If this Agreement shall be terminated pursuant to any of the
provisions hereof, or if the sale of the Securities provided for herein is
not consummated because any condition to the obligations of the Initial
Purchasers set forth herein is not satisfied or because of any refusal,
inability or failure on the part of the Company to perform any agreement
herein or comply with any provision hereof, the Company will, subject to
demand by the Initial Purchasers, reimburse the Initial Purchasers for all
out-of-pocket expenses (including the fees and expenses of their counsel),
incurred by the Initial Purchasers in connection herewith.
14. No Waiver; Modifications in Writing. No failure or delay on the part
of the Company or any Initial Purchaser in exercising any right, power or remedy
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right, power or remedy preclude any other or further
exercise thereof or the exercise of any other right, power or remedy. The
-29-
remedies provided for herein are cumulative and are not exclusive of any
remedies that may be available to the Company or any Initial Purchaser at law or
in equity or otherwise. No waiver of or consent to any departure by the Company
or any Initial Purchaser from any provision of this Agreement shall be effective
unless signed in writing by the party entitled to the benefit thereof; provided
that notice of any such waiver shall be given to each party hereto as set forth
below. Except as otherwise provided herein, no amendment, modification or
termination of any provision of this Agreement shall be effective unless signed
in writing by or on behalf of the Company and each Initial Purchaser. Any
amendment, supplement or modification of or to any provision of this Agreement,
any waiver of any provision of this Agreement, and any consent to any departure
by the Company or the Initial Purchasers from the terms of any provision of this
Agreement shall be effective only in the specific instance and for the specific
purpose for which made or given. Except where notice is specifically required by
this Agreement, no notice to or demand on any party in any case shall entitle
such party to any other or further notice or demand in similar or other
circumstances.
15. Governing Law and Jurisdiction; Waiver of Jury Trial. Each of the
parties hereto irrevocably (a) submits to the jurisdiction of any court of the
State of New York or the United State District Court for the Southern District
of the State of New York for the purpose of any suit, action, or other
proceeding arising out of this Agreement, or any of the agreements or
transactions contemplated by this Agreement, the Registration Statement and the
Prospectus (each, a "PROCEEDING"), (b) agrees that all claims in respect of any
Proceeding may be heard and determined in any such court, (c) waives, to the
fullest extent permitted by law, any immunity from jurisdiction of any such
court or from any legal process therein, (d) agrees not to commence any
Proceeding other than in such courts, and (e) waives, to the fullest extent
permitted by law, any claim that such Proceeding is brought in an inconvenient
forum. EACH OF THE PARTIES HERETO (ON BEHALF OF ITSELF AND, TO THE FULLEST
EXTENT PERMITTED BY LAW, ON BEHALF OF ITS RESPECTIVE EQUITY HOLDERS AND
CREDITORS) HEREBY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF
ANY CLAIM BASED UPON, ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT AND
THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT AND THE OFFERING MEMORANDUM.
16. The parties acknowledge and agree that, for purposes of Sections
4(a) and 7 hereof, the information provided by or on behalf of any Initial
Purchaser consists solely of the names of the Initial Purchasers set forth on
the front cover page of the Offering Memorandum and at the end of paragraph 1
under the caption "Plan of Distribution" in the Offering Memorandum and the
material included in paragraphs 3, 10 and 14 and the phrase in the sixth
sentence of paragraph 9 that reads "The initial purchasers have advised us they
intend to make a market in the notes" under the caption "Plan of Distribution"
in the Offering Memorandum.
17. Counterparts. This Agreement may be signed in counterparts, each of
which shall be an original and all of which together shall constitute one and
the same instrument.
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If the foregoing correctly sets forth your understanding, please so
indicate in the space provided below for that purpose, whereupon this letter
shall constitute a binding agreement among us.
Very truly yours,
L-1 IDENTITY SOLUTIONS, INC.
By: /s/ Xxxxx X. XxXxxxx
------------------------------------
Name: Xxxxx X. XxXxxxx
Title: Executive Vice President,
Chief Financial Officer and
Treasurer
L-1 IDENTITY SOLUTIONS, INC.
By: /s/ Xxxxx X. XxXxxxx
------------------------------------
Name: Xxxxx X. XxXxxxx
Title: Executive Vice President,
Chief Financial Officer and
Treasurer
The foregoing Purchase Agreement
is hereby confirmed and accepted
as of the date first above written.
BEAR, XXXXXXX & CO. INC.
BANC OF AMERICA SECURITIES LLC
Acting on behalf of themselves
and as Representatives
of the Initial Purchasers
By: BEAR, XXXXXXX & CO. INC.
By: /s/ Xxxx X. Xxxxxx
------------------------------------
Name: Xxxx X. Xxxxxx
Title: Senior Managing Director
By: BANC OF AMERICA SECURITIES LLC
By: /s/ Xxxxx X. XxXxxxxxx
------------------------------------
Name: Xxxxx X. XxXxxxxxx
Title: Managing Director
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