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EXHIBIT 4.6
AMF BOWLING, INC.
ZERO COUPON CONVERTIBLE DEBENTURES DUE 2018
PURCHASE AGREEMENT
May 6, 1998
Xxxxxxx, Xxxxx & Co.,
Xxxxx & Company,
Xxxxxx Xxxxxxx & Co. Incorporated,
Xxxxxxxx & Co. Inc.,
c/o Goldman, Xxxxx & Co.,
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000.
Ladies and Gentlemen:
AMF Bowling, Inc., a Delaware corporation (the "Company"), proposes,
subject to the terms and conditions stated herein, to issue and sell to the
Purchasers named in Schedule I hereto (the "Purchasers") an aggregate of $
900,000,000 principal amount at maturity of the Zero Coupon Convertible
Debentures due 2018, convertible into Common Stock, par value $0.01 per share
("Stock"), of the Company, specified above (the "Firm Securities") and, at the
election of the Purchasers, up to an aggregate of $ 225,000,000 additional
aggregate principal amount at maturity (the "Optional Securities") (the Firm
Securities and the Optional Securities which the Purchasers elect to purchase
pursuant to Section 2 hereof are herein collectively called the "Securities").
1. The Company represents and warrants to, and agrees with, each of the
Purchasers that:
(a) A preliminary offering circular, dated April 27, 1998 (the
"Preliminary Offering Circular"), and an offering circular, dated May 6,
1998 (the "Offering Circular"), have been prepared in connection with the
offering of the Securities and shares of the Stock issuable upon
conversion, repurchase or redemption thereof. The Preliminary Offering
Circular or the Offering Circular and any amendments or supplements
thereto did not and will not, as of their respective dates, contain 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 under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by a Purchaser through
Xxxxxxx, Sachs & Co. expressly for use therein;
(b) The Company's most recent Annual Report on Form 10-K and all
subsequent documents filed prior to or at the Time of Delivery with the
United States Securities and Exchange Commission (the "Commission")
pursuant to Section 13(a), 13(c) or 15(d) of the United States Securities
Exchange Act of 1934, as amended (the "Exchange Act"), as amended or
supplemented (hereinafter called the "Exchange Act Reports"), when they
were or are filed with the Commission, conformed or will conform in all
material respects to the applicable requirements of the Exchange Act and
the applicable rules and regulations of the Commission thereunder; and the
Exchange Act Reports
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did not and will not, as of their respective dates, contain 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
under which they were made, not misleading;
(c) Neither the Company nor any of its subsidiaries has sustained
since the date of the latest audited financial statements included in the
Offering Circular any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance,
or from any labor dispute or court or governmental action, order or
decree, which would, individually or in the aggregate, reasonably be
expected to have a material adverse effect on the general affairs,
management, properties, financial position, stockholders' equity, results
of operations or prospects of the Company and its subsidiaries taken as a
whole (a "Material Adverse Effect"), otherwise than as set forth or
contemplated in the Offering Circular; and, since the respective dates as
of which information is given in the Offering Circular, there has not been
any change in the capital stock, short-term debt or long-term debt of the
Company or any of its subsidiaries or any material adverse change, or any
development involving a prospective material adverse change, in or
affecting the general affairs, management, financial position, properties,
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 Offering Circular (other than the issuance of Stock upon exercise
of outstanding options under the Company's 1996 Stock Incentive Plan);
(d) The Company and each of its subsidiaries have good and
marketable title in fee simple to all real property and good and
marketable title to all personal property owned by them, in each case free
and clear of all liens, encumbrances and defects except such as are
described in the Offering Circular or such as would not, individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect
and do not interfere with the use made and proposed to be made of such
property by the Company or any of its subsidiaries; and any real property
and buildings held under lease by the Company or any of its subsidiaries
are held by them under valid, subsisting and enforceable leases with such
exceptions as would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect and do not interfere with the
use made and proposed to be made of such property and buildings by the
Company or any of its subsidiaries;
(e) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of Delaware,
with power and authority (corporate and other) to own its properties and
conduct its business as described in the Offering Circular, and has been
duly qualified as a foreign corporation for the transaction of business
and is in good standing under the laws of each other jurisdiction in which
it owns or leases properties or conducts any business so as to require
such qualification, except for such failure to be so qualified or in good
standing as would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect;
(f) Each subsidiary of the Company has been duly incorporated and is
validly existing as a corporation in good standing under the laws of its
jurisdiction of incorporation, with power and authority (corporate and
other) to own its properties and conduct its business as described in the
Offering Circular, and has been duly qualified as a foreign corporation
for the transaction of business and is in good standing under the laws of
each other jurisdiction in which it owns or leases properties or conducts
any business so as to require such qualification, except for such failure
to be so qualified or in good standing as would not, individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect;
(g) The Company has an authorized capitalization as set forth in the
Offering Circular, and 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 conform to the description of the Stock contained
in the Offering Circular; and the shares of Stock initially issuable upon
conversion of the Securities have been duly and validly authorized and
reserved for issuance and, when issued and delivered in accordance with
the provisions of the Securities and the Indenture referred to below, will
be duly and validly issued,
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fully paid and non-assessable and will conform to the description of the
Stock contained in the Offering Circular; and all of the issued shares of
capital stock of each subsidiary of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable and are owned
directly or indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims, except the pledge of the shares of
certain subsidiaries of the Company as collateral security for the
obligations of AMF Bowling Worldwide, Inc., a Delaware Corporation and
indirect wholly owned subsidiary of the Company ("AMF Bowling Worldwide")
pursuant to the Third Amended and Restated Credit Agreement, dated as of
November 3, 1997, among AMF Bowling Worldwide, the lenders parties
thereto, Xxxxxxx Xxxxx Credit Partners L.P. and Citicorp Securities, Inc.,
as Arrangers, Xxxxxxx Sachs Credit Partners L.P., as Syndication Agent,
Citibank, N.A., as Administrative Agent, and Citicorp USA, Inc., as
Collateral Agent, as in effect on the date hereof (the "Third Amended and
Restated Credit Agreement"); and, except as set forth in the Offering
Circular, there are no outstanding subscriptions, rights, warrants,
options, calls, convertible securities, commitments of sale or liens
related to or entitling any person to purchase or otherwise to acquire any
shares of the capital stock of, or other ownership interest in, the
Company or any of its subsidiaries;
(h) The Firm Securities and Optional Securities have been duly
authorized and, when issued and delivered pursuant to this Agreement and
the Indenture, will have been duly executed, authenticated, issued and
delivered and will constitute valid and legally binding obligations of the
Company, subject to bankruptcy, insolvency, reorganization and other laws
of general applicability relating to or affecting creditors' rights and to
general equity principles, entitled to the benefits provided by the
indenture to be dated as of May 12, 1998 (the "Indenture") between the
Company and The Bank of New York, as Trustee (the "Trustee"), under which
they are to be issued; the Indenture has been duly authorized and, when
executed and delivered by the Company and the Trustee, the Indenture will
constitute a valid and legally binding instrument, enforceable in
accordance with its terms, subject to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or
affecting creditors' rights and to general equity principles; and the
Securities and the Indenture will conform to the descriptions thereof in
the Offering Circular;
(i) Each of the Company and each of the subsidiaries of the Company
listed on the signature pages hereof (the "Designated Subsidiaries") has
all requisite corporate power and authority to execute, deliver and
perform their obligations under this Agreement and to consummate the
transactions contemplated hereby, including without limitation, in the
case of the Company, the corporate power and authority to issue, sell and
deliver the Securities, as provided herein;
(j) 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 G, T, U, and X of the Board of Governors of the
Federal Reserve System;
(k) Prior to the date hereof, neither the Company nor any of its
subsidiaries has taken any action which is designed to or which has
constituted or which would reasonably 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;
(l) The issue and sale of the Firm Securities and Optional
Securities by the Company hereunder and the compliance by the Company and
each of the Designated Subsidiaries with all of the provisions of the
Securities, the Indenture and this Agreement and the consummation of the
transactions herein and therein contemplated will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust,
sale/leaseback agreement, loan agreement or other similar financing
agreement or instrument or other agreement or instrument to which the
Company, any Designated
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Subsidiary or any of their respective subsidiaries is a party or by which
the Company, any Designated Subsidiary or any of their respective
subsidiaries is bound or to which any of the property or assets of the
Company, any Designated Subsidiary or any of their respective subsidiaries
is subject, which conflict, breach, violation or default could,
individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect, nor will such action result in any violation of
the provisions of the Certificate of Incorporation, By-laws or other
organizational documents of the Company, any Designated Subsidiary or any
of their respective subsidiaries or any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction
over the Company, any Designated Subsidiary or any of their respective
subsidiaries or any of their properties; and 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 the consummation by the Company or any Designated
Subsidiary of the transactions contemplated by this Agreement or the
Indenture, except (i) the filing of a registration statement by the
Company with the Commission pursuant to the United States Securities Act
of 1933, as amended (the "Act") pursuant to Section 5(k) hereof and
related qualification of the Indenture under the TIA (as hereinafter
defined) 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
Purchasers and (ii) such consents, approvals, authorizations,
registrations or qualifications as may be required to permit the Company
and its subsidiaries to retain its existing liquor and gaming, lottery and
gambling licenses;
(m) Each of the Company and each of its subsidiaries has complied in
all respects with all laws, regulations and orders applicable to it or its
businesses the violation of which would have a Material Adverse Effect;
(n) Neither the Company nor any of its subsidiaries is (i) in
violation of its Certificate of Incorporation, By-laws or other
organizational documents or (ii) in default in the performance or
observance of any obligation, agreement, covenant or condition contained
in any indenture, mortgage, deed of trust, loan agreement, sale/leaseback
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, which default would,
individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect;
(o) Except as would not, individually or in the aggregate, have a
Material Adverse Effect, (i) each of the Company and each of its
subsidiaries has all certificates, consents, exemptions, orders, permits,
licenses, authorizations or other approvals (each, an "Authorization") of
and from, and has made all declarations and filings with, all Federal,
state, local and other governmental authorities, all self-regulatory
organizations and all courts and other tribunals, necessary or required to
engage in the business currently conducted by it in the manner described
in the Offering Circular; (ii) all Authorizations required pursuant to
clause (i) of this paragraph are valid and in full force and effect; and
(iii) each of the Company and each of its subsidiaries is in compliance in
all material respects with the terms and conditions of all such
Authorizations and with the rules and regulations of the regulatory
authorities and governing bodies having jurisdiction with respect thereto;
(p) The statements set forth in the Offering Circular under the
caption "Description of Debentures" and "Description of Capital Stock",
insofar as they purport to constitute a summary of the terms of the
Securities and the Stock, and under the captions "Certain Transactions",
"Description of Certain Indebtedness" and "Underwriting", insofar as they
purport to describe the provisions of the laws and documents referred to
therein, are accurate in all material respects and represent a fair
summary of such laws and documents;
(q) Other than as set forth or contemplated in the Offering
Circular, 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,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect, would interfere with or adversely affect the
issuance and sale of the Securities or the Stock issuable upon conversion
thereof or would affect the validity of this Agreement or the Indenture;
and, to the best of the Company's
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knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(r) When the Firm Securities and Optional Securities are issued and
delivered pursuant to this Agreement, the Securities will not be of the
same class (within the meaning of Rule 144A under the 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;
(s) The Company is subject to Section 13 or 15(d) of the Exchange
Act;
(t) The Company is not and, after giving effect to the offering and
sale of the Securities, will not be, an open-end investment company, unit
investment trust or face-amount certificate company that is or is required
to be registered under Section 8 of the Investment Company Act of 1940, as
amended (the "Investment Company Act");
(u) Neither the Company, nor any person acting on its or their
behalf has offered or sold the Securities by means of any general
solicitation or general advertising within the meaning of Rule 502(c)
under the Act or, with respect to Securities sold outside the United
States to non-U.S. persons (as defined in Rule 902 under the Act), by
means of any directed selling efforts within the meaning of Rule 902 under
the Act and the Company, any affiliate of the Company and any person
acting on its or their behalf has complied with and will implement the
"offering restriction" within the meaning of such Rule 902; provided that
no representation is made herein as to the actions of you or your
affiliates other than the Company and its subsidiaries;
(v) Within the preceding six months, neither the Company nor any
other person acting on behalf of the Company has offered or sold to any
person any Securities, or any securities of the same class (within the
meaning of Rule 144A under the Act) as the Securities, other than
Securities offered or sold to the Purchasers hereunder. The Company will
take reasonable precautions designed to insure that any offer or sale,
direct or indirect, in the United States or to any U.S. person (as defined
in Rule 902 under the Act) of any Securities or any substantially similar
security issued by the Company, within six months subsequent to the date
on which the distribution of the Securities has been completed (as
notified to the Company by Xxxxxxx, Xxxxx & Co.), is made under
restrictions and other circumstances reasonably designed not to affect the
status of the offer and sale of the Securities in the United States and to
U.S. persons contemplated by this Agreement as transactions exempt from
the registration provisions of the Act;
(w) The consolidated historical financial statements, together with
related schedules and notes, set forth in the Offering Circular fairly
present, in all material respects, the consolidated financial position and
condition of the Company and its subsidiaries at the respective dates
indicated and the results of their operations and their cash flows for the
respective periods indicated, in accordance with United States generally
accepted accounting principles consistently applied throughout such
periods. The pro forma financial statements contained in the Offering
Circular have been prepared on a basis consistent with such historical
statements, except for the pro forma adjustments specified therein, and
give effect to assumptions made on a reasonable basis and present fairly,
in all material respects and in accordance with such assumptions, the
historical and proposed transactions described in the Offering Circular or
contemplated by this Agreement. The other financial information and data
included in the Offering Circular, historical and pro forma, are, in all
material respects, accurately presented and prepared on a basis consistent
with such financial statements and the books and records of the Company
and its subsidiaries;
(x) Except as set forth in the Offering Circular, neither the
Company or any of its subsidiaries has violated any applicable existing
federal, state, local or international laws and regulations relating to
protection of human health or the environment or imposing liability or
standards of conduct concerning any Hazardous Material ("Environmental
Laws"); lacks any permits, licenses
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or other approvals required of it under applicable Environmental Laws; or
is violating any term or condition of any such permit, license or
approval, except, in each case, for any instances of violation, lack or
noncompliance that, either individually or in the aggregate, would not
have a Material Adverse Effect. The term "Hazardous Material" means (i)
any "hazardous substance" as defined by the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended, (ii) any
"hazardous waste" as defined by the Resource Conservation and Recovery
Act, as amended, (iii) any petroleum or petroleum product, (iv) any
polychlorinated biphenyl, and (v) any pollutant or contaminant or
hazardous, dangerous or toxic chemical, material, waste or substance
regulated under or within the meaning of any other law relating to
protection of human health or the environment or imposing liability or
standards of conduct concerning any such chemical material, waste or
substance;
(y) Each of the Company and each of its subsidiaries owns or
possesses or has the right to use the patents, patent rights, licenses,
inventions, copyrights, know-how (including trade secrets and other
unpatented and/or unpatentable proprietary or confidential information,
systems or procedures), trademarks, service marks and trade names
(collectively, the "Intellectual Property") presently employed by it in
connection with, and material to, individually or in the aggregate, the
operation of the businesses now operated by it, and, except as described
in the Offering Circular, none of the Company or any of its subsidiaries
has received any notice of infringement of or conflict with asserted
rights of others with respect to the foregoing which, individually or in
the aggregate, would reasonably be expected to result in a Material
Adverse Effect. The use of such Intellectual Property in connection with
the business and operations of the Company and each of its subsidiaries
does not infringe on the rights of any person, except any such
infringements that, individually or in the aggregate, would not result in
a Material Adverse Effect;
(z) All tax returns required to be filed by the Company or any of
its subsidiaries in any jurisdiction have been timely and duly filed,
other than those filings being contested in good faith, except where the
failure to so file any such returns, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect. There
are no tax returns of the Company or any of its subsidiaries that are
currently being audited by state, local or federal taxing authorities or
agencies (and with respect to which the Company or any of its subsidiaries
has received notice), where the findings of such audit would reasonably be
expected to result in a Material Adverse Effect. All taxes, including
withholding taxes, penalties and interest, assessments, fees and other
charges due or claimed to be due from such entities have been paid, other
than those being contested in good faith and for which adequate reserves
have been provided or those currently payable without penalty or interest
and other than those that are not material or that would not result in a
Material Adverse Effect;
(aa) Each of the Company and each of its subsidiaries maintains
insurance covering its properties, operations, personnel and businesses
which insures against such losses and risks as are adequate in accordance
with its reasonable business judgment to protect the Company and each of
its subsidiaries and their businesses. None of the Company or any of its
subsidiaries has received notice from any insurer or agent of such insurer
that substantial capital improvements or other expenditures will have to
be made in order to continue such insurance. All such insurance is
outstanding and duly in force on the date hereof and will be outstanding
and duly in force at each Time of Delivery (as defined in Section 4
hereof), except for any failures to be so in force as would not,
individually or in the aggregate, reasonably be expected to result in a
Material Adverse Effect;
(bb) No labor dispute with the employees of the Company or any of
its subsidiaries exists or, to the knowledge of the Company or any of its
subsidiaries, is imminent except any such disputes as could not,
individually or in the aggregate, reasonably be expected to result in a
Material Adverse Effect; and neither the Company nor or any of its
subsidiaries is aware of any existing or imminent labor disturbance by the
employees of any of its principal suppliers, manufacturers or contractors
which could reasonably be expected to result in a Material Adverse Effect;
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(cc) There are no holders of securities of the Company or any of its
subsidiaries who, by reason of the execution of this Agreement by the
Company or any of its subsidiaries, as the case may be, or the
consummation of the transactions contemplated hereby and thereby, have the
right to request or demand the Company or any of its subsidiaries to
register under the Act or analogous foreign laws and regulations any
securities held by them, except (i) the Registration Rights Agreement,
dated as of March 21, 1996, by and among the Company, certain guarantors
of the securities referred to therein and Xxxxxxx, Sachs & Co., and (ii)
the Registration Rights Agreement, dated as of April 30, 1996, by and
among the Company and certain of its stockholders as of such date, as
amended to the date hereof; and (iii) the Registration Rights Agreement,
to be dated as of May 12, 1998, by and among the Company, the Designated
Subsidiaries and the Purchasers (the "Registration Rights Agreement"); and
(dd) Each of Xxxxxx Xxxxxxxx LLP, who have certified certain
financial statements of the Company and its subsidiaries, Price Waterhouse
LLP, who have certified certain financial statements of the predecessor to
the Company and its subsidiaries, and Todres & Scheiffer, who have
certified certain financial statements of Charan Industries, Inc., are
independent public accountants as required by the Act and the rules and
regulations of the Commission thereunder.
2. Subject to the terms and conditions herein set forth, (a) the Company
agrees to issue and sell to each of the Purchasers, and each of the Purchasers
agrees, severally and not jointly, to purchase from the Company, at a purchase
price of 24.499% of the principal amount thereof at maturity, plus accrued
Original Issue Discount (as defined in the Offering Circular) from May 12, 1998
to the Time of Delivery hereunder, the principal amount at maturity of Firm
Securities set forth opposite the name of such Purchaser in Schedule I hereto,
and (b) in the event and to the extent that the Purchasers shall exercise the
election to purchase Optional Securities as provided below, the Company agrees
to issue and sell to each of the Purchasers, and each of the Purchasers agrees,
severally and not jointly, to purchase from the Company, at the same purchase
price set forth in clause (a) of this Section 2, that portion of the aggregate
principal amount at maturity of the Optional Securities as to which such
election shall have been exercised (to be adjusted by you so as to eliminate
fractions of $1,000) determined by multiplying such aggregate principal amount
of Optional Securities by a fraction, the numerator of which is the maximum
aggregate principal amount at maturity of Optional Securities which such
Purchaser is entitled to purchase as set forth opposite the name of such
Purchaser in Schedule I hereto and the denominator of which is the maximum
aggregate principal amount at maturity of Optional Securities which all of the
Purchasers are entitled to purchase hereunder.
The Company hereby grants to the Purchasers the right to purchase at their
election up to $225,000,000 aggregate principal amount at maturity of Optional
Securities, at the same purchase price set forth in clause (a) of the first
paragraph of this Section 2 for the sole purpose of covering overallotments in
the sale of the Firm Securities. Any such election to purchase Optional
Securities may be exercised only by written notice from you to the Company,
given within a period of 30 calendar days after the date of this Agreement,
setting forth the aggregate principal amount at maturity of Optional Securities
to be purchased and the date on which such Optional Securities are to be
delivered, as determined by you but in no event earlier than the First Time of
Delivery (as defined in Section 4 hereof) or, unless you and the Company
otherwise agree in writing, earlier than two or later than ten business days
after the date of such notice.
3. Upon the authorization by you of the release of the Firm Securities,
the several Purchasers propose to offer the Firm Securities for sale upon the
terms and conditions set forth in this Agreement and the Offering Circular and
each Purchaser hereby represents and warrants to, and agrees with the Company
that:
(a) It will offer and sell the Securities only to persons who it
reasonably believes are "qualified institutional buyers" ("QIBs") within
the meaning of Rule 144A under the Act in transactions meeting the
requirements of Rule 144A;
(b) It is an Institutional Accredited Investor; and
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(c) It will not offer or sell the Securities by any form of general
solicitation or general advertising, including but not limited to the methods
described in Rule 502(c) under the Act.
4. (a) The Securities to be purchased by each Purchaser hereunder will be
represented by one or more definitive global Securities 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
Securities to Xxxxxxx, Xxxxx & Co., for the account of such Purchaser, against
payment by or on behalf of such Purchaser of the purchase price therefor by wire
transfer in Federal (same day) funds to an account(s) designated by the Company,
by causing DTC to credit the Securities to the account of Xxxxxxx, Sachs & Co.
at DTC. The Company will cause the certificates representing the Securities to
be made available to Xxxxxxx, Xxxxx & Co. for checking at least twenty-four
hours prior to the Time of Delivery (as defined below) at the office of DTC or
its designated custodian (the "Designated Office"). The time and date of such
delivery and payment shall be 9:30 a.m., New York City time, on May 12, 1998 or
such other time and date as Xxxxxxx, Sachs & Co. and the Company may agree upon
in writing, and, with respect to the Optional Securities, 9:30 a.m., New York
City time, on the date specified by Xxxxxxx, Xxxxx & Co. in the written notice
given by Xxxxxxx, Sachs & Co. of the Purchasers' election to purchase such
Optional Securities, or such other time and date as Xxxxxxx, Xxxxx & Co. and the
Company may agree upon in writing. Such time and date for delivery of the Firm
Securities is herein called the "First Time of Delivery", such time and date for
delivery of the Optional Securities, if not the First Time of Delivery, is
herein called the "Second Time of Delivery", and each such time and date for
delivery is herein called a "Time of Delivery".
(b) The documents to be delivered at each Time of Delivery by or on behalf
of the parties hereto pursuant to Section 7 hereof, including the cross-receipt
for the Securities and any additional documents requested by the Purchasers
pursuant to Section 7(j) hereof, will be delivered at such time and date at the
offices of Xxxxxxxx & Xxxxxxxx, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the
"Closing Location"), and the Securities will be delivered at the Designated
Office, all at such Time of Delivery. A meeting will be held at the Closing
Location at 2:00. p.m., New York City time, on the New York Business Day next
preceding such Time of Delivery, at which meeting the final drafts of the
documents to be delivered pursuant to the preceding sentence will be available
for review by the parties hereto. For the purposes of this Section 4, "New York
Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in New York are generally
authorized or obligated by law or executive order to close.
5. The Company agrees with each of the Purchasers:
(a) To prepare the Offering Circular in a form approved by you; to
make no amendment or any supplement to the Offering Circular which shall
be disapproved by you promptly after reasonable notice thereof; and to
furnish you with copies thereof;
(b) Promptly from time to time to take such action as you may
reasonably request to qualify the Securities and the shares of Stock
issuable upon conversion, redemption or repurchase of the Securities for
offering and sale under the securities laws of such jurisdictions as you
may request and to comply with such laws so as to permit the continuance
of sales and dealings therein in such jurisdictions for as long as may be
necessary to complete the distribution of the Securities, provided that in
connection therewith the Company shall not be required to qualify as a
foreign corporation or to file a general consent to service of process in
any jurisdiction;
(c) To furnish the Purchasers with 4 copies of the Offering Circular
and each amendment or supplement thereto signed by an authorized officer
of the Company with the independent accountants' report(s) in the Offering
Circular, and any amendment or supplement containing amendments to the
financial statements covered by such report(s), signed by the accountants,
and additional copies thereof in such quantities as you may from time to
time reasonably request, and if, at any time prior to the expiration of
nine months after the date of the Offering Circular, any event shall have
occurred as a result of which the Offering Circular as then amended or
supplemented would include an untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made when
such
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Offering Circular is delivered, not misleading, or, if for any other
reason it shall be necessary or desirable during such same period to amend
or supplement the Offering Circular, to notify you and upon your request
to prepare and furnish without charge to each Purchaser and to any dealer
in securities as many copies as you may from time to time reasonably
request of an amended Offering Circular or a supplement to the Offering
Circular which will correct such statement or omission or effect such
compliance;
(d) During the period beginning from the date hereof and continuing
to and including the 90th day after the date of the Offering Circular,
directly or indirectly, not to issue, offer, sell, contract to sell,
pledge, grant an option to purchase or otherwise dispose of any Securities
or shares of Stock (other than the issuance of Stock (i) pursuant to
existing employee stock option and stock purchase plans or the Company's
proposed 1998 Stock Incentive Plan (the "98 Plan"), (ii) upon conversion,
redemption or repurchase of the Securities or (iii) as consideration for
acquisitions of bowling centers or other related entities so long as the
seller of the center or centers or other related entity or entities to be
acquired agrees to be bound by the provisions of this Section 5(d)) or any
other securities of the Company that are substantially similar to the
Securities or the Stock, including but not limited to any securities that
are convertible into or exchangeable for, or that represent the right to
receive, Stock or any such substantially similar securities (other than
pursuant to existing employee stock option and stock purchase plans or the
98 Plan, upon the conversion of outstanding convertible securities or
warrants or pursuant to existing earn-out obligations arising out of prior
acquisitions), or enter into any swap, option, future, forward or other
cash-settled or physically-settled hedging transaction relating to the
Securities or the Stock that transfers, in whole or in part, the economic
consequence of ownership of such securities or any securities
substantially similar to the Securities or the Stock, in each case without
your prior written consent;
(e) Not to be or become, at any time prior to the expiration of two
years after such Time of Delivery, an open-end investment company, unit
investment trust or face-amount certificate company that is or is required
to be registered under Section 8 of the Investment Company Act;
(f) At any time when the Company is not subject to Section 13 or
15(d) of the Exchange Act, for the benefit of holders from time to time of
Securities, to furnish at its expense, upon request, to holders of
Securities and prospective purchasers of securities information (the
"Additional Issuer Information") satisfying the requirements of subsection
(d)(4)(i) of Rule 144A under the Act;
(g) If requested by you, to use its best efforts to cause the
Securities to be eligible for the PORTAL trading system of the National
Association of Securities Dealers, Inc.;
(h) To furnish to the holders of the Securities as soon as available
(and in any event no later than the time within which the Company is
required to file its Form 10-K with the Commission) 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 available (and in any event no later than the time within
which the Company is required to file its Forms 10-Q with the Commission)
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 Offering
Circular), consolidated summary financial information of the Company and
its subsidiaries for such quarter in reasonable detail;
(i) During a period of five years from the date of the Offering
Circular, to furnish to you copies of all reports or other communications
(financial or other) furnished to stockholders of the Company, and to
deliver to you (i) 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 (ii) such additional information concerning the
business and financial condition of the Company as you may from time to
time reasonably request (such financial statements to be on a consolidated
basis to the extent the accounts
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of the Company and its subsidiaries are consolidated in reports furnished
to its stockholders generally or to the Commission);
(j) During the period of two years after such Time of Delivery, the
Company will not, and will not permit any of its "affiliates" (as defined
in Rule 144 under the Act) which it controls to, resell any of the
Securities or any Stock issued upon conversion, redemption or repurchase
thereof which constitute "restricted securities" under Rule 144 that have
been reacquired by any of them;
(k) The Company shall file and use its best efforts to cause to be
declared or become effective under the Act, on or prior to 180 days after
the First Time of Delivery, a shelf registration statement on an available
Form with respect to resales, from time to time, of the Securities and the
Stock issuable upon conversion, redemption or repurchase thereof and to
use its best efforts to maintain the effectiveness of such registration
statement during the period required under Section 2 of the Registration
Rights Agreement;
(l) To use the net proceeds received by it from the sale of the
Securities pursuant to this Agreement in the manner specified in the
Offering Circular under the caption "Use of Proceeds";
(m) To reserve and keep available at all times, free of preemptive
rights, shares of Stock for the purpose of enabling the Company to satisfy
any obligations to issue shares of its Stock upon conversion of the
Securities; and
(n) To use its best efforts to list, subject to notice of issuance,
the shares of Stock issuable upon conversion of the Securities on the New
York Stock Exchange (the "Exchange").
6. The Company covenants and agrees with the several Purchasers that the
Company will pay or cause to be paid the following: (i) the fees, disbursements
and expenses of the Company's counsel and accountants in connection with the
issue of the Securities and the shares of Stock issuable upon conversion of the
Securities and all other expenses in connection with the preparation, printing
and filing of the Preliminary Offering Circular and the Offering Circular and
any amendments and supplements thereto and the mailing and delivering of copies
thereof to the Purchasers and dealers; (ii) the cost of printing or producing
any Agreement among Purchasers, this Agreement, the Indenture, the Blue Sky and
Legal Investment Memoranda, closing documents (including any compilations
thereof) and any other documents in connection with the offering, purchase, sale
and delivery of the Securities; (iii) all expenses in connection with the
qualification of the Securities and the shares of Stock issuable upon
conversion, redemption or repurchase of the Securities for offering and sale
under state securities laws as provided in Section 5(b) hereof, including the
fees and disbursements of counsel for the Purchasers in connection with such
qualification and in connection with the Blue Sky and legal investment surveys;
(iv) any fees charged by securities rating services for rating the Securities;
(v) the cost of preparing the Securities; (vi) the fees and expenses of the
Trustee and any agent of the Trustee and , if requested by the Trustee, the fees
and disbursements of counsel for the Trustee in connection with the Indenture
and the Securities; (vii) any cost incurred in connection with the designation
of the Securities for trading in PORTAL and the listing of the shares of Stock
issuable upon conversion, redemption or repurchase of the Securities; (viii) the
cost and charges of any transfer agent or registrar for the Securities or the
Stock issuable upon conversion, redemption or repurchase thereof; and (ix) all
other costs and expenses incident to the performance of its obligations
hereunder which are not otherwise specifically provided for in this Section. It
is understood, however, that, except as provided in this Section, and Sections 8
and 11 hereof, the Purchasers will pay all of their own costs and expenses,
including the fees of their counsel, transfer taxes on resale of any of the
Securities by them, and any advertising expenses connected with any offers they
may make.
7. The obligations of the Purchasers hereunder shall be subject, in their
discretion, to the condition that all representations and warranties and other
statements of the Company herein are, at and as of such Time of Delivery, true
and correct, the condition that the Company shall have performed all of its
obligations hereunder theretofore to be performed, and the following additional
conditions:
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(a) Xxxxxxxx & Xxxxxxxx, counsel for the Purchasers, shall have
furnished to you such opinion or opinions, dated such Time of Delivery,
with respect to such matters as you may reasonably request, and such
counsel shall have received such papers and information as they may
reasonably request to enable them to pass upon such matters;
(b) Wachtell, Lipton, Xxxxx & Xxxx, counsel for the Company, shall
have furnished to you their written opinion, dated such the Time of
Delivery, in form and substance satisfactory to you, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
State of Delaware, with power and authority (corporate and other) to
own its properties and conduct its business as described in the
Offering Circular;
(ii) The Company has an authorized capitalization as set forth
in the Offering Circular, and all of the issued shares of capital
stock of the Company have been duly and validly authorized and
issued and are fully paid and non-assessable; and the shares of
Stock initially issuable upon conversion, redemption or repurchase
of the Securities, when issued and delivered in accordance with the
provisions of the Securities and the Indenture, will be duly and
validly issued and fully paid and non-assessable, and will conform
to the description of the Stock contained in the Offering Circular;
except as set forth in the Offering Circular, to such counsel's
knowledge, there are no outstanding subscriptions, rights, warrants,
options, calls, convertible securities, commitments of sale or liens
related to or entitling any person to purchase or otherwise to
acquire any shares of the capital stock of, or other ownership
interest in, the Company;
(iii) The Company has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
properties or conducts any business so as to require such
qualification, except for such failures to be so qualified or in
good standing as would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect (such
counsel being entitled to rely in respect of the opinion in this
clause upon opinions of local counsel and in respect of matters of
fact upon certificates of officers of the Company, provided that
such counsel shall state that they believe that both you and they
are justified in relying upon such opinions and certificates);
(iv) Each of the Company and each of AMF Bowling Worldwide,
AMF Group Holdings Inc., a Delaware corporation, AMF Bowling
Holdings Inc., a Delaware corporation, AMF Bowling Centers Holdings
Inc., a Delaware corporation, and AMF Worldwide Bowling Centers
Holdings Inc., a Delaware corporation (collectively, the "Delaware
Subsidiaries"), has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of
Delaware;
(v) To such counsel's knowledge and other than as set forth or
contemplated in the Offering Circular, 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, individually or in the
aggregate, could reasonably be expected to have a Material Adverse
Effect, would interfere with or adversely affect the issuance and
sale of the Securities or would affect the validity of this
Agreement or the Indenture;
(vii) The Securities being issued at such Time of Delivery
constitute valid and legally binding obligations of the Company
enforceable in accordance with its terms and
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entitled to the benefits provided by the Indenture subject to
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights and to
general equity principles; and the Securities and the Indenture
conform to the descriptions thereof in the Offering Circular;
(viii) The Indenture constitutes a valid and legally binding
instrument, enforceable in accordance with its terms, subject to
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights and to
general equity principles;
(ix) The issue and sale of the Securities being issued at such
Time of Delivery and the compliance by the Company with all of the
provisions of the Securities, the Indenture and this Agreement and
the consummation of the transactions herein and therein contemplated
will not conflict with or result in a breach or violation of any of
the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument (a) known to such counsel and (b) 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 and which is a "material contract" within the meaning of
Item 601 of Regulation S-K promulgated under the Exchange Act, nor
will such action result in any violation of the provisions of the
Certificate of Incorporation or By-laws of the Company or any
statute or any order, rule or regulation known to such counsel of
any court or governmental agency or body having jurisdiction over
the Company or any of its subsidiaries or any of their properties,
except that such counsel need express no opinion as to any statute,
order, rule or regulation relating to liquor and gaming, lottery and
gambling licenses;
(x) No consent, approval, authorization, order, registration
or qualification of or with any such court or governmental agency or
body is required under federal or New York law or the General
Corporation Law of the State of Delaware for the issue and sale of
the Securities or the consummation by the Company of the
transactions contemplated by this Agreement or the Indenture, except
(i) such as may be required under the Act in connection with the
shares of Stock issuable upon conversion of the Securities or under
the TIA in connection with the qualification of the Indenture
thereunder, 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 Purchasers and (ii) such
consents, approvals, authorizations, orders, registrations or
qualifications as may be required to permit the Company and its
subsidiaries to retain its existing liquor and gaming, lottery and
gambling licenses;
(xi) Each of the Company and each of the Delaware Subsidiaries
has all requisite corporate power and authority to execute, deliver
and perform its obligations under this Agreement and to consummate
the transactions contemplated hereby, including without limitation
the corporate power and authority to issue, sell and deliver the
Securities as provided herein;
(xii) To such counsel's knowledge, neither the Company nor any
of the Delaware Subsidiaries is in violation of its Certificate of
Incorporation or By-laws;
(xiii) The statements set forth in the Offering Circular under
the caption "Description of Debentures", "Description of Capital
Stock", insofar as they purport to constitute a summary of the terms
of the Securities and the Stock, and under the captions "Certain
Transactions", "Description of Certain Indebtedness" and
"Underwriting", insofar as they purport to describe the provisions
of the laws and documents referred to therein, are accurate in all
material respects and represent a fair summary of such provisions;
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(xv) No registration of the Securities under the Act, and no
qualification of an indenture under the United States Trust
Indenture Act of 1939 (the "TIA") with respect thereto, is required
for the offer, sale and initial resale of the Securities by the
Purchasers in the manner contemplated by this Agreement; and
(xvii) Such counsel have no reason to believe that the
Offering Circular and any further amendments or supplements thereto
made by the Company prior to such Time of Delivery (other than the
financial statements and related schedules and other financial data
therein, as to which such counsel need express no opinion) contained
as of its date or contains as of such Time of Delivery an untrue
statement of a material fact or omitted or omits, as the case may
be, to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were
made, not misleading.
In rendering such opinion, such counsel may state that they express
no opinion as to the laws of any jurisdiction other than the laws of the
State of New York, the General Corporation Law of the State of Delaware,
and the federal laws of the United States.
(c) McGuire, Woods, Battle & Xxxxxx LLP, counsel for the Company,
shall have furnished to you their written opinion, dated such Time of
Delivery, in form and substance satisfactory to you, to the effect that:
(i) Each of the Designated Subsidiaries incorporated in the
State of Virginia has been duly incorporated and is validly existing
as a corporation in good standing under the laws of its jurisdiction
of incorporation; each such subsidiary has been duly qualified as a
foreign corporation for the transaction of business and is in good
standing under the laws of each other jurisdiction in which it owns
or leases properties or conducts any business so as to require such
qualification, or is subject to no material liability or disability
by reason of the failure to be so qualified in any such
jurisdiction; all of the issued shares of capital stock of each such
subsidiary have been duly and validly authorized and issued, are
fully paid and non-assessable, and are owned directly or indirectly
by the Company, free and clear of all liens, encumbrances, equities
or claims, except the pledge of the shares of certain subsidiaries
of the Company as collateral security for the obligations of AMF
Bowling Worldwide pursuant to the Second Amended and Restated Credit
Agreement as in effect on the date hereof and as amended and
restated as the Third Amended and Restated Credit Agreement; and
except as set forth in the Offering Circular, based on an
examination of the corporate records and minute books, there are no
outstanding subscriptions, rights, warrants, options, calls,
convertible securities, commitments of sale or liens related to or
entitling any person to purchase or otherwise to acquire any shares
of the capital stock of, or other ownership interest in, any such
subsidiary (such counsel being entitled to rely in respect of the
opinion in this clause upon opinions of local counsel and in respect
to matters of fact upon certificates of officers of the Company or
its subsidiaries, provided that such counsel shall state that they
believe that both you and they are justified in relying upon such
opinions and certificates);
(ii) This Agreement has been duly authorized, executed and
delivered by the Company and each of the Designated Subsidiaries;
(iii) The Securities being issued at such Time of Delivery
have been duly authorized, executed, issued and delivered by or on
behalf of the Company, assuming due authentication thereof by the
Trustee in accordance with the Indenture;
(iv) The shares of Stock initially issuable upon conversion,
redemption or repurchase of the Securities have been duly and
validly authorized and reserved for issuance;
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(v) The Indenture has been duly authorized, executed and
delivered by the parties thereto;
(vi) The statements set forth in the Offering Circular under
the caption "Certain Federal Income Tax Considerations", insofar as
they purport to describe the provisions of the laws and documents
referred to therein, are accurate in all material respects and
represent a fair summary of such provisions; and
(vii) Each of the Designated Subsidiaries incorporated in the
Commonwealth of Virginia has all requisite corporate power and
authority to execute, deliver and perform its obligations under this
Agreement and to consummate the transactions contemplated hereby;
In rendering such opinion, such counsel may state that they express
no opinion as to the laws of any jurisdiction other than the laws of the
Commonwealth of Virginia and the federal laws of the United States.
(d) On the date of the Offering Circular at a time prior to the
execution of this Agreement and also at each Time of Delivery, Xxxxxx
Xxxxxxxx LLP shall have furnished to you a letter or letters, dated the
respective dates of delivery thereof, in form and substance satisfactory
to you, to the effect set forth in Annex I hereto, and each of Price
Waterhouse LLP and Todres & Scheiffer, shall have furnished to you a
letter or letters, dated the respective dates of delivery thereof, in form
and substance satisfactory to you, to the effect set forth in Annex II
hereto;
(e) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements
included in the Offering Circular 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 Offering Circular, and (ii) since the respective dates as of which
information is given in the Offering Circular there shall not have been
any change in the capital stock, short-term debt 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, otherwise than as set
forth or contemplated in the Offering Circular, the effect of which, in
any such case described in Clause (i) or (ii), is in the judgment of
Xxxxxxx, Xxxxx & Co. on behalf of the Purchasers so material and adverse
as to make it impracticable or inadvisable to proceed with the offering or
the delivery of the Securities being delivered at such Time of Delivery on
the terms and in the manner contemplated in this Agreement and in the
Offering Circular;
(f) On or after the date hereof (i) 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 Act,
and (ii) no such organization shall have publicly announced that it has
under surveillance or review, with possible negative implications, its
rating of any of the Company's debt securities;
(g) On or after the date hereof there shall not have occurred any of
the following: (i) a suspension or material limitation in trading in
securities generally on the Exchange; (ii) a suspension or material
limitation in trading in the Company's securities on the Exchange; (iii) a
general moratorium on commercial banking activities declared by either
Federal or New York State authorities; or (iv) the outbreak or escalation
of hostilities involving the United States or the declaration by the
United States of a national emergency or war, if the effect of any such
event specified in this Clause (iv) in the judgment of Xxxxxxx, Sachs &
Co. on behalf of the Purchasers makes it impracticable or inadvisable to
proceed with the public offering or the delivery of the Securities being
delivered at such Time of Delivery on the terms and in the manner
contemplated in the Offering Circular;
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(h) The Securities have been designated for trading on PORTAL;
(i) The Company has obtained and delivered to the Purchasers
executed copies of an agreement from each director and executive officer
of the Company, substantially to the effect set forth in subsection 5(d)
hereof in form and substance satisfactory to you, except as waived by
Xxxxxxx, Xxxxx & Co. on behalf of the Purchasers;
(j) The Company shall have furnished or caused to be furnished to
you at each Time of Delivery certificates of officers of the Company
satisfactory to you as to the accuracy of the representations and
warranties of the Company herein at and as of such Time of Delivery, as to
the performance by the Company of all of its obligations hereunder to be
performed at or prior to such Time of Delivery, as to the matters set
forth in subsection (e) of this Section and as to such other matters as
you may reasonably request;
(k) The shares of Stock issuable upon conversion of the Securities
shall have been duly listed, subject to notice of issuance, on the
Exchange; and
(l) The Company and the Designated Subsidiaries, on the one hand,
and the Purchasers, on the other hand, shall each have entered into the
Registration Rights Agreement and received the executed counterparts of
the other.
8 (a) The Company and the Designated Subsidiaries, jointly and
severally, will indemnify and hold harmless each Purchaser against any losses,
claims, damages or liabilities, joint or several, to which such Purchaser may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Offering Circular or the Offering Circular, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact necessary to make the
statements therein not misleading, and will reimburse each Purchaser for any
legal or other expenses reasonably incurred by such Purchaser in connection with
investigating or defending any such action or claim as such expenses are
incurred; provided, however, that the Company and the Designated Subsidiaries
shall not be liable in any such case to the extent that any such loss, claim,
damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in any Preliminary
Offering Circular or the Offering Circular or any such amendment or supplement
in reliance upon and in conformity with written information furnished to the
Company by any Purchaser through Xxxxxxx, Sachs & Co. expressly for use therein.
(b) Each Purchaser will indemnify and hold harmless the Company and
the Designated Subsidiaries against any losses, claims, damages or
liabilities to which the Company or the Designated Subsidiaries may become
subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon an untrue statement or alleged untrue statement of a material
fact contained in any Preliminary Offering Circular or the Offering
Circular, or any amendment or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a material
fact or necessary to make the statements therein not misleading, in each
case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in any
Preliminary Offering Circular or the Offering Circular or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Purchaser through Xxxxxxx,
Sachs & Co. expressly for use therein; and will reimburse the Company and
the Designated Subsidiaries for any legal or other expenses reasonably
incurred by the Company and the Designated Subsidiaries in connection with
investigating or defending any such action or claim as such expenses are
incurred.
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof
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is to be made against the indemnifying party under such subsection, notify
the indemnifying party in writing of the commencement thereof; but the
omission so to notify the indemnifying party shall not relieve it from any
liability which it may have to any indemnified party otherwise than under
such subsection. In case any such action shall be brought against any
indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with
any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall
not, except with the consent of the indemnified party, which consent shall
not be unreasonably withheld, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection for any
legal expenses of other counsel or any other expenses, in each case
subsequently incurred by such indemnified party, in connection with the
defense thereof other than reasonable costs of investigation. No
indemnifying party shall, without the written consent of the indemnified
party, which consent shall not be unreasonably withheld, effect the
settlement or compromise of, or consent to the entry of any judgment with
respect to, any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not
the indemnified party is an actual or potential party to such action or
claim) unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability arising
out of such action or claim and (ii) does not include a statement as to,
or an admission of, fault, culpability or a failure to act, by or on
behalf of any indemnified party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect the relative benefits received by the Company and
the Designated Subsidiaries on the one hand and the Purchasers on the
other from the offering of the Securities. If, however, the allocation
provided by the immediately preceding sentence is not permitted by
applicable law or if the indemnified party failed to give the notice
required under subsection (c) above, then each indemnifying party shall
contribute to such amount paid or payable by such indemnified party in
such proportion as is appropriate to reflect not only such relative
benefits but also the relative fault of the Company and the Designated
Subsidiaries on the one hand and the Purchasers on the other in connection
with the statements or omissions which resulted in such losses, claims,
damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. The relative benefits received by
the Company and the Designated Subsidiaries on the one hand and the
Purchasers on the other shall be deemed to be in the same proportion as
the total net proceeds from the offering of the Securities purchased under
this Agreement (before deducting expenses) received by the Company and the
Designated Subsidiaries bear to the total underwriting discounts and
commissions received by the Purchasers with respect to the Securities
purchased under this Agreement, in each case as set forth in the Offering
Circular. The relative fault shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates
to information supplied by the Company and the Designated Subsidiaries on
the one hand or the 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, the Designated
Subsidiaries and the Purchasers agree that it would not be just and
equitable if contribution pursuant to this subsection (d) were determined
by pro rata allocation (even if the 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
subsection (d). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages or liabilities (or actions in
respect thereof) referred to above in this subsection (d) shall be deemed
to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such
action or claim. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution
from any person who was not guilty
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of such fraudulent misrepresentation. Notwithstanding the provisions of
this subsection (d), no Purchaser shall be required to contribute any
amount in excess of the amount by which the total price at which the
Securities underwritten by it and distributed to investors were offered to
investors exceeds the amount of any damages which such Purchaser has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. The Purchasers' obligations in
this subsection (d) to contribute are several in proportion to their
respective underwriting obligations and not joint.
(e) The obligations of the Company and the Designated Subsidiaries
under this Section 8 shall be in addition to any liability which the
Company and the Designated Subsidiaries may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls any Purchaser within the meaning of the Act; and the obligations
of the Purchasers under this Section 8 shall be in addition to any
liability which the respective Purchasers may otherwise have and shall
extend, upon the same terms and conditions, to each officer and director
of the Company and to each person, if any, who controls the Company or the
Designated Subsidiaries within the meaning of the Act.
9 (a) If any Purchaser shall default in its obligation to purchase the
Securities which it has agreed to purchase hereunder at a Time of Delivery, you
may in your discretion arrange for you or another party or other parties to
purchase such Securities on the terms contained herein. If within thirty-six
hours after such default by any Purchaser you do not arrange for the purchase of
such Securities, then the Company shall be entitled to a further period of
thirty-six hours within which to procure another party or other parties
satisfactory to you to purchase such Securities on such terms. In the event
that, within the respective prescribed periods, you notify the Company that you
have so arranged for the purchase of such Securities, or the Company notifies
you that it has so arranged for the purchase of such Securities, you or the
Company shall have the right to postpone such Time of Delivery for a period of
not more than seven days, in order to effect whatever changes may thereby be
made necessary in the Offering Circular, or in any other documents or
arrangements, and the Company agrees to prepare promptly any amendments to the
Offering Circular which in your opinion may thereby be made necessary. The term
"Purchaser" as used in this Agreement shall include any person substituted under
this Section with like effect as if such person had originally been a party to
this Agreement with respect to such Securities.
(b) If, after giving effect to any arrangements for the purchase of
the Securities of a defaulting Purchaser or Purchasers by you and the
Company as provided in subsection (a) above, the aggregate principal
amount at maturity of such Securities which remains unpurchased does not
exceed one-eleventh of the aggregate principal amount at maturity of all
the Securities to be purchased at such Time of Delivery, then the Company
shall have the right to require each non-defaulting Purchaser to purchase
the principal amount at maturity of Securities which such Purchaser agreed
to purchase hereunder at such Time of Delivery and, in addition, to
require each non-defaulting Purchaser to purchase its pro rata share
(based on the principal amount at maturity of Securities which such
Purchaser agreed to purchase hereunder) of the Securities of such
defaulting Purchaser or Purchasers for which such arrangements have not
been made; but nothing herein shall relieve a defaulting Purchaser from
liability for its default.
(c) If, after giving effect to any arrangements for the purchase of
the Securities of a defaulting Purchaser or Purchasers by you and the
Company as provided in subsection (a) above, the aggregate principal
amount at maturity of Securities which remains unpurchased exceeds
one-eleventh of the aggregate principal amount at maturity of all the
Securities to be purchased at such Time of Delivery, or if the Company
shall not exercise the right described in subsection (b) above to require
non-defaulting Purchasers to purchase Securities of a defaulting Purchaser
or Purchasers, then this Agreement (or, with respect to the Second Time of
Delivery, the obligations of the Purchasers to purchase and of the Company
to sell the Optional Securities) shall thereupon terminate, without
liability on the part of any non-defaulting Purchaser or the Company,
except for the expenses to be borne by the Company and the Purchasers as
provided in Section 6 hereof and the indemnity and contribution
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agreements in Section 8 hereof; but nothing herein shall relieve a
defaulting Purchaser from liability for its default.
10 The respective indemnities, agreements, representations, warranties and
other statements of the Company and the several Purchasers, as set forth in this
Agreement or made by or on behalf of them, respectively, pursuant to this
Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Purchaser or any controlling person of any Purchaser, or the Company, or
any officer or director or controlling person of the Company, and shall survive
delivery of and payment for the Securities.
11 If this Agreement shall be terminated pursuant to Section 9 hereof, the
Company shall not then be under any liability to any Purchaser except as
provided in Sections 6 and 8 hereof; but, if for any other reason, any
Securities are not delivered by or on behalf of the Company as provided herein,
the Company will reimburse the Purchasers through you for all out-of-pocket
expenses approved in writing by you, including fees and disbursements of
counsel, reasonably incurred by the Purchasers in making preparations for the
purchase, sale and delivery of the Securities not so delivered, but the Company
shall then be under no further liability to any Purchaser in respect of the
Securities not so delivered except as provided in Sections 6 and 8 hereof.
12 In all dealings hereunder, you shall act on behalf of each of the
Purchasers, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Purchaser made or given
by you jointly or by Xxxxxxx, Xxxxx & Co. on your behalf.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Purchasers shall be delivered or sent by mail, telex or
facsimile transmission to you in care of Xxxxxxx, Sachs & Co., 00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Registration Department; and if to the
Company shall be delivered or sent by mail, telex or facsimile transmission to
the address of the Company set forth in the Offering Circular, Attention:
Secretary, with copies to (a) GS Capital Partners II, L.P., 00 Xxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Xxxxx X. Xxxxxxxxx, Esq., (b) Wachtell, Lipton,
Xxxxx & Xxxx, 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx
X. Xxxx, Esq. and (c) McGuire, Woods, Battle & Xxxxxx LLP, 000 Xxxx Xxxx Xxxxxx,
Xxxxxxxx, Xxxxxxxx 00000, Attention: Xxxxxx X. Xxxxxx, III, Esq.; provided,
however, that any notice to a Purchaser pursuant to Section 8(c) hereof shall be
delivered or sent by mail, telex or facsimile transmission to such Purchaser at
its address set forth in its Purchasers' Questionnaire, or telex constituting
such Questionnaire, which address will be supplied to the Company by you upon
request. Any such statements, requests, notices or agreements shall take effect
at the time of receipt thereof.
13 This Agreement shall be binding upon, and inure solely to the benefit
of, the Purchasers, the Company and, to the extent provided in Sections 8 and 10
hereof, the officers and directors of the Company and each person who controls
the Company or any Purchaser, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement. No purchaser of any of the
Securities from any Purchaser shall be deemed a successor or assign by reason
merely of such purchase.
14 Time shall be of the essence of this Agreement. As used herein, the
term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15 THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.
16 This Agreement may be executed by any one or more of the parties hereto
in any number of counterparts, each of which shall be deemed to be an original,
but all such counterparts shall together constitute one and the same instrument.
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If the foregoing is in accordance with your understanding, please sign and
return to us 8 counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the Purchasers, this letter and such acceptance hereof shall
constitute a binding agreement between each of the Purchasers and the Company.
It is understood that your acceptance of this letter on behalf of each of the
Purchasers is pursuant to the authority set forth in a form of Agreement among
Purchasers, the form of which shall be furnished to the Company for examination
upon request, but without warranty on your part as to the authority of the
signers thereof.
Very truly yours,
AMF Bowling, Inc.
AMF Group Holdings Inc.
AMF Bowling Worldwide, Inc.
AMF BCO-China, Inc.
AMF BCO-France One, Inc.
AMF BCO-France Two, Inc.
AMF BCO-UK One, Inc.
AMF BCO-UK Two, Inc.
AMF Beverage Company of Oregon, Inc.
AMF Beverage Company of W. Va., Inc.
AMF Bowling Centers, Inc.
AMF Bowling Centers China, Inc.
AMF Bowling Centers International Inc.
AMF Bowling Centers (Aust)
International Inc.
AMF Bowling Centers (Canada)
International Inc.
AMF Bowling Centers (Hong Kong)
International Inc.
AMF Bowling Centers Holdings Inc.
AMF Bowling Centers Spain Inc.
AMF Bowling Centers Switzerland Inc.
AMF Bowling Products, Inc.
AMF Bowling Holdings Inc.
AMF Bowling Mexico Holding, Inc.
AMF Worldwide Bowling Centers
Holdings Inc.
Boliches AMF, Inc.
Xxxx River Corporation
Xxxx Xxxxx Lenaxa, Inc.
American Recreation Centers Inc.
Burleigh Recreation, Inc.
300, Inc.
Lake Grove Centers, Inc.
Xxxxxxx Xxxxxx Golf Company, Inc.
Xxxxxxx Xxxxxx Golf-Water Tower, Inc.
MJG-X'Xxxx, Inc.
By: _____________________________
Name: Xxxxxxx X. Xxxx
Title: Executive Vice President
Accepted as of the date hereof:
Xxxxxxx, Xxxxx & Co.
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Xxxxx & Company
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxxx & Co. Inc.
By: ______________________________
(Xxxxxxx, Xxxxx & Co.)
On behalf of each of the Purchasers
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SCHEDULE I
PRINCIPAL AMOUNT
PRINCIPAL AT MATURITY OF
AMOUNT AT OPTIONAL
MATURITY OF SECURITIES TO BE
SECURITIES PURCHASED IF
TO BE MAXIMUM OPTION
PURCHASER PURCHASED EXERCISED
--------- --------- ---------
Xxxxxxx, Sachs & Co. .............. $585,000,000 $146,250,000
Xxxxx & Company ................... 90,000,000 22,500,000
Xxxxxx Xxxxxxx & Co. Incorporated.. 135,000,000 33,750,000
Xxxxxxxx & Co. Inc. ............... 90,000,000 22,500,000
------------ ------------
Total ....................... $900,000,000 $225,000,000
============ ============
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ANNEX I
Pursuant to Section 7(d) of the Purchase Agreement, the accountants shall
furnish letters to the Purchasers to the effect that:
(i) They are independent certified public accountants with respect
to the Company and its subsidiaries as would be required within the
meaning of the Act and the applicable published rules and regulations
thereunder;
(ii) In their opinion, the financial statements audited by them and
included in the Offering Circular comply as to form in all material
respects with the applicable accounting requirements of the Act and the
related published rules and regulations thereunder; and they have made a
review in accordance with standards established by the American Institute
of Certified Public Accountants of the unaudited consolidated interim
financial statements for the periods specified in such letter;
(iii) They have made a review in accordance with standards
established by the American Institute of Certified Public Accountants of
any unaudited condensed consolidated statements of income, consolidated
balance sheets and consolidated statements of cash flows and on the basis
of specified procedures including inquiries of officials of the Company
who have responsibility for financial and accounting matters regarding
whether the unaudited condensed consolidated financial statements referred
to in paragraph (vi)(A)(i) below comply as to form in all material
respects with the applicable accounting requirements of the Act and the
related published rules and regulations, nothing came to their attention
that caused them to believe that the unaudited condensed consolidated
financial statements do not comply as to form in all material respects
with the applicable accounting requirements of the Act and the related
published rules and regulations;
(iv) The unaudited selected financial information with respect to
the consolidated results of operations and financial position of the
Company for the five most recent fiscal years included in the Offering
Circular agrees with the corresponding amounts (after restatements where
applicable) in the audited consolidated financial statements for such five
fiscal years which were included or incorporated by reference in the
Company's Annual Reports on Form 10-K for such fiscal years;
(v) They have compared the information in the Offering Circular
under selected captions with the disclosure requirements of Regulation S-K
and on the basis of limited procedures specified in such letter nothing
came to their attention as a result of the foregoing procedures that
caused them to believe that this information does not conform in all
material respects with the disclosure requirements of Items 301, 302, 402
and 503(d), respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company and its subsidiaries, inspection of
the minute books of the Company and its subsidiaries since the date of the
latest audited financial statements included in the Offering Circular,
inquiries of officials of the Company and its subsidiaries responsible for
financial and accounting matters and such other inquiries and procedures
as may be specified in such letter, nothing came to their attention that
caused them to believe that:
(A) (i) the unaudited consolidated statements of income,
consolidated balance sheets and consolidated statements of cash
flows do not comply as to form in all material respects with the
applicable accounting requirements of the Act and the related
published rules and regulations, or (ii) any material modifications
should be made to the unaudited condensed consolidated statements of
income, consolidated balance sheets and consolidated statements of
cash flows for them to be in conformity with generally accepted
accounting principles;
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(B) any other unaudited income statement data and balance
sheet items included in the Offering Circular do not agree with the
corresponding items in the unaudited consolidated financial
statements from which such data and items were derived, and any such
unaudited data and items were not determined on a basis
substantially consistent with the basis for the corresponding
amounts in the audited consolidated financial statements included in
the Offering Circular;
(C) the unaudited financial statements which were not included
in the Offering Circular but from which were derived any unaudited
condensed financial statements referred to in Clause (A) and any
unaudited income statement data and balance sheet items included in
the Offering Circular and referred to in Clause (B) were not
determined on a basis substantially consistent with the basis for
the audited consolidated financial statements included in the
Offering Circular;
(D) as of a specified date not more than five days prior to
the date of such letter, there have been any changes in the
consolidated capital stock (other than issuances of capital stock
upon exercise of options and stock appreciation rights, upon
earn-outs of performance shares and upon conversions of convertible
securities, in each case which were outstanding on the date of the
latest financial statements included in the Offering Circular) or
any increase in the consolidated long-term debt of the Company and
its subsidiaries, or any decreases in consolidated net current
assets or stockholders' equity or other items specified by the
Representatives, or any increases in any items specified by the
Representatives, in each case as compared with amounts shown in the
latest balance sheet included in the Offering Circular, except in
each case for changes, increases or decreases which the Offering
Circular discloses have occurred or may occur or which are described
in such letter; and
(E) for the period from the date of the latest financial
statements included in the Offering Circular to the specified date
referred to in Clause (E) there were any decreases in consolidated
net revenues or operating profit or the total or per share amounts
of consolidated net income or other items specified by the
Representatives, or any increases in any items specified by the
Representatives, in each case as compared with the comparable period
of the preceding year and with any other period of corresponding
length specified by the Representatives, except in each case for
decreases or increases which the Offering Circular discloses have
occurred or may occur or which are described in such letter; and
(viii) In addition to the examination referred to in their report(s)
included in the Offering Circular and the limited procedures, inspection
of minute books, inquiries and other procedures referred to in paragraphs
(iii) and (vi) above, they have carried out certain specified procedures,
not constituting an examination in accordance with generally accepted
auditing standards, with respect to certain amounts, percentages and
financial information specified by the Representatives, which are derived
from the general accounting records of the Company and its subsidiaries,
which appear in the Offering Circular, and have compared certain of such
amounts, percentages and financial information with the accounting records
of the Company and its subsidiaries and have found them to be in
agreement.
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ANNEX II
Pursuant to Section 7(d) of the Purchase Agreement, the accountants shall
furnish letters to the Purchasers to the effect that:
(i) They are independent certified public accountants with respect
to the Company and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder; and
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules (and, if applicable,
financial forecasts and/or pro forma financial information) examined by
them and included in the Offering Circular comply as to form in all
material respects with the applicable accounting requirements of the Act
and the related published rules and regulations thereunder; and, if
applicable, they have made a review in accordance with standards
established by the American Institute of Certified Public Accountants of
the unaudited consolidated interim financial statements, selected
financial data, pro forma financial information, financial forecasts
and/or condensed financial statements derived from audited financial
statements of the Company for the periods specified in such letter, as
indicated in their reports thereon, copies of which have been furnished to
the representatives of the Purchasers (the "Representatives") and are
attached hereto.
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