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AMERIKING, INC.
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______ UNITS
CONSISTING IN THE AGGREGATE OF
$30,000,000
___% SENIOR EXCHANGEABLE PREFERRED STOCK DUE 2008
AND
____ SHARES OF COMMON STOCK
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UNDERWRITING AGREEMENT
DATED AS OF NOVEMBER ___, 1996
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Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation
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November ___, 1996
XXXXXXXXX, LUFKIN & XXXXXXXX
SECURITIES CORPORATION
000 Xxxxxxxx Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
AmeriKing, Inc., a Delaware corporation (the "Company"), proposes to
issue and sell (the "Units Offering") _______ Units (the "Units"), consisting
in the aggregate of $30,000,000 aggregate liquidation preference of its ___%
Senior Exchangeable Preferred Stock due 2008 (the "Senior Preferred Stock") and
_______ shares of Common Stock, par value $0.01 per share (the "Common Stock"),
of the Company to Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation ("DLJ").
Each Unit will consist of $________ aggregate liquidation preference of Senior
Preferred Stock and ________________ shares of Common Stock. The Senior
Preferred Stock will be exchangeable as set forth in the Certificate of
Designation relating thereto (the "Certificate of Designation") for the
Company's ___% Subordinated Exchange Debentures due 2008 (the "Exchange
Debentures") to be issued pursuant to the provisions of an indenture (the
"Indenture") between the Company and Fleet National Bank, as Trustee (the
"Trustee"). The Units, the Senior Preferred Stock, the Common Stock and the
Exchange Debentures are sometimes collectively referred to herein as the
"Securities."
Concurrently with the Units Offering, the company is offering (the
"Notes Offering" and, together with the Unit Offering, the "Offerings")
$100,000,000 principal amount of its ___% Senior Notes due 2006 (the "Senior
Notes").
1. REGISTRATION STATEMENT AND PROSPECTUS. The Company has prepared and
filed with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations of the Commission thereunder (collectively, the
"Act"), a registration statement on Form S-1 (File No. 333-04261), including a
prospectus relating to the Securities, which may be amended. The registration
statement as amended at the time when it becomes effective, including a
registration statement (if any) filed pursuant to Rule 462(b) under the Act
increasing the size of the Offerings registered under the Act and information
(if any) deemed to be part of the registration statement at the time of
effectiveness pursuant to Rule 430A under the Act, is hereinafter referred to
as the "Registration Statement" and the prospectus in the form first used to
confirm sales of Securities is hereinafter referred as the "Prospectus."
2. AGREEMENTS TO SELL AND PURCHASE. On the basis of the
representations and warranties contained in this Agreement, and subject to its
terms and conditions, the Company agrees to issue and sell the Units to DLJ,
and DLJ agrees to purchase the Units from the Company, at a purchase price of
$____ per Unit (the "Purchase Price"), plus accumulated dividends, if any, from
December 3, 1996, to the date of payment and delivery.
3. TERMS OF PUBLIC OFFERING. The Company is advised by you that you
propose (i) to make a public offering of the Units as soon after the effective
date of the Registration Statement as in your judgment is advisable and (ii)
initially to offer the Units upon the terms set forth in the Prospectus.
4. DELIVERY AND PAYMENT. Delivery to DLJ of, and payment for, the
Units shall be made at 10:00 a.m., Eastern Standard Time, on December 3, 1996,
or such other date as may be permitted by the Commission pursuant to Rule
15c6-1 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
following the date of the initial public offering (the "Closing Date"), at the
offices of Xxxxxx & Xxxxxxx, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000. The
Closing Date and the location of delivery of and the form of payment for the
Securities may be varied by agreement between you and the Company.
Certificates for the Units, including the Senior Preferred Stock and
the Common Stock, shall be registered in such names and issued in such
denominations as you shall request no later than two full business days prior
to the Closing Date. Such certificates shall be made available to you for
inspection not later than 9:30 a.m., Eastern Standard Time, on the business day
immediately preceding the Closing Date. Certificates in definitive form
evidencing the Units shall be delivered to you on the Closing Date, with any
transfer taxes thereon duly paid by the Company, against payment of the
Purchase Price therefor by wire transfer or certified or official bank check or
checks payable in same day funds to the order of the Company or as the Company
may direct.
5. AGREEMENTS OF THE COMPANY. The Company agrees with you:
(a) To use its best efforts to cause the Registration Statement
to become effective at the earliest possible time.
(b) To advise you promptly and, if requested by you, to confirm
such advice in writing, (i) when the Registration Statement has become
effective and when any post-effective amendment to the Registration
Statement becomes effective, (ii) of any request by the Commission for
amendments to the Registration Statement or amendments or supplements
to the Prospectus or for additional information, (iii) of the issuance
by the Commission of any stop order suspending the
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effectiveness of the Registration Statement or of the suspension of
qualification of any of the Securities for offering or sale in any
jurisdiction, or the initiation of any proceeding for such purposes,
and (iv) of the happening of any event during the period referred to
in Section 5(e) which makes any statement of a material fact made in
the Registration Statement or the Prospectus untrue or which requires
the making of any additions to or changes in the Registration
Statement or the Prospectus in order to make the statements therein
not misleading. If at any time the Commission shall issue any stop
order suspending the effectiveness of the Registration Statement, the
Company will make every reasonable effort to obtain the withdrawal or
lifting of such order at the earliest possible time.
(c) To provide you, without charge, one signed copy of the
Registration Statement as first filed with the Commission and of each
amendment to it, including all exhibits, and to furnish to you such
number of conformed copies of the Registration Statement as so filed
and of each amendment to it, without exhibits, as you may reasonably
request.
(d) Not to file any amendment or supplement to the Registration
Statement, whether before or after the time when it becomes effective,
or to make any amendment or supplement to the Prospectus of which you
shall not previously have been advised or to which you shall
reasonably object; and to prepare and file with the Commission,
promptly upon your reasonable request, any amendment to the
Registration Statement or supplement to the Prospectus which may be
necessary or advisable in connection with the distribution of the
Units by you, and to use its best efforts to cause the same to become
promptly effective.
(e) Promptly after the Registration Statement becomes effective,
and from time to time thereafter for such period as in the opinion of
your counsel a prospectus is required by law to be delivered in
connection with sales by you or a dealer, to furnish to you and each
dealer as many copies of the Prospectus (and of any amendment or
supplement to the Prospectus) as you or such dealer may reasonably
request; provided, however, that in the event you are required to
deliver a prospectus nine months or more after the date hereof, the
Company promptly will prepare, at DLJ's expense, such amendment or
amendments to the Registration Statement and supplements or amendments
to the prospectus as may be necessary to comply with the requirements
of Section 10(a)(3) of the Act.
(f) If during the period specified in Section 5(e), any event
shall occur as a result of which, in the opinion of your counsel, it
becomes necessary to amend or supplement the Prospectus in order to
make the statements therein, in the light of the circumstances when
the Prospectus is delivered to
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a purchaser, not misleading, or if it is necessary to amend or
supplement the Prospectus to comply with any law, promptly (i) to
prepare and file with the Commission an appropriate amendment or
supplement to the Prospectus so that the statements in the Prospectus,
as so amended or supplemented, will not, in the light of the
circumstances when it is so delivered, be misleading, or so that the
Prospectus will comply with law, and (ii) to furnish to you and to
such dealers as you shall specify such number of copies of the
Prospectus as so amended or supplemented as you or such dealers may
reasonably request; provided, however, that in the event you are
required to deliver a prospectus nine months or more after the date
hereof, the Company promptly will prepare, at DLJ's expense, such
amendment or amendments to the Registration Statement and supplements
or amendments to the prospectus as may be necessary to comply with the
requirements of Section 10(a)(3) of the Act.
(g) Prior to any public offering of the Units, (i) to cooperate
with you and your counsel in connection with the registration or
qualification of the Securities for offer and sale by you and by
dealers under the state securities or Blue Sky laws of such
jurisdictions as you may request, (ii) to continue such qualification
in effect so long as required for distribution of the Securities and
(iii) to file such consents to service of process or other documents
as may be necessary to effect such registration or qualification;
provided that in no event shall the Company be obligated to qualify to
do business in any jurisdiction where it is not now so qualified, or
to take any action which would subject it to general service of
process in any jurisdiction where it is not so subject.
(h) To mail and make generally available to its security holders
as soon as reasonably practicable an earnings statement covering a
period of at least twelve months after the effective date of the
Registration Statement (but in no event commencing later than 90 days
after such date) which shall satisfy the provisions of Section 11(a)
of the Act.
(i) So long as required by the Certificate of Designation, the
Indenture or the Exchange Act, to file reports pursuant to Section 13
or 15(d) of the Exchange Act, and, during the period of three years
following the date of this Agreement, to deliver to you, promptly upon
their becoming available, (i) copies of all current, regular and
periodic reports filed by the Company with any securities exchange or
with the Commission or any governmental authority succeeding to any of
the Commission's functions, and (ii) copies of each report or other
publicly available information of the Company mailed to the holders of
any Securities and such other publicly available information
concerning the Company and its subsidiaries as you may request.
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(j) Prior to the Closing Date, to furnish to you, as soon as they
have been prepared by the Company, a copy of any consolidated
financial statements of the Company for any period subsequent to the
period covered by the financial statements appearing in the
Registration Statement.
(k) To use the proceeds from the sale of the Units in the manner
specified in the Registration Statement (and any amendments or
supplements thereto) under the caption "Use of Proceeds."
(l) Not to voluntarily claim, and to resist actively any attempts
to claim, the benefit of any usury laws against the holders of the
Securities.
(m) To pay all costs, expenses, fees and taxes incident to:
(i) the preparation, printing, filing and distribution under
the Act of the Registration Statement (including financial
statements and exhibits), each preliminary prospectus and all
amendments and supplements to any of them prior to or during the
period specified in Section 5(e);
(ii) the printing and delivery of the Prospectus and all
amendments or supplements to the Prospectus during the period
specified in Section 5(e);
(iii) the printing and delivery of this Agreement, the
Indenture, the Certificate of Designation, the Securities, the
Preliminary and Supplemental Blue Sky Memoranda and all other
agreements, memoranda, correspondence and other documents printed
and delivered in connection herewith and with the Units Offering
(including, in each case, any disbursements of your counsel
relating to such printing and delivery);
(iv) the issuance and delivery by the Company of the Units;
(v) the registration or qualification of the Securities for
offer and sale under the securities or Blue Sky laws of the
several states (including in each case the fees and disbursements
of your counsel relating to such registration or qualification
and memoranda relating thereto);
(vi) filings and clearance with the National Association of
Securities Dealers, Inc. in connection with the Units Offering;
(vii) furnishing such copies of the Registration Statement,
each preliminary prospectus and the Prospectus
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(including all documents incorporated by reference therein) and
all amendments and supplements thereto as may be requested for
use in connection with the offering or sale of the Units by you
or by dealers to whom Units may be sold;
(viii) the rating of the Securities by rating agencies, if
any;
(ix) all fees and expenses (including fees and expenses of
counsel) of the Company in connection with approval of the
Securities by the Depository Trust Company for "book-entry"
transfer; and
(x) the performance by the Company of its other obligations
under this Agreement.
(n) If this Agreement shall be terminated pursuant to any of the
provisions hereof (otherwise than a default by you) or if for any
reason the Company shall be unable or unwilling to perform its
obligations hereunder, the Company shall, except as otherwise agreed
by the parties hereto, reimburse you for the fees and expenses to be
paid or reimbursed by the Company pursuant to Section 5(m), and
reimburse you for all out-of-pocket expenses (including the fees and
expenses of your counsel) reasonably incurred by you or by dealers to
whom Units may be sold in connection with the transactions
contemplated by this Agreement.
(o) During the period beginning on the date of this Agreement and
continuing to and including the Closing Date, not to offer, sell,
contract to sell or otherwise dispose of any securities of the Company
or warrants to purchase securities of the Company substantially
similar to any of the Securities (other than (i) the Securities and
(ii) the Senior Notes), without your prior written consent.
(p) Not to distribute any offering material in connection with
the offering and sale of the Units other than the Registration
Statement, the Prospectus, and any preliminary prospectus.
(q) To use its best efforts to do and perform all things required
or necessary to be done and performed under this Agreement by the
Company prior to the Closing Date and to satisfy all conditions
precedent to the delivery of the Securities.
6. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to you that:
(a) The Registration Statement has become effective, no stop
order suspending the effectiveness of the Registration
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Statement is in effect, and no proceedings for such purpose are
pending before or threatened by the Commission.
(b) (i) Each part of the Registration Statement, when such part
became effective, did not contain and each such part, as amended or
supplemented, if applicable, will not contain any untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading,
(ii) the Registration Statement and the Prospectus comply and, as
amended or supplemented, if applicable, will comply in all material
respects with the Act and (iii) the Prospectus does not contain and,
as amended or supplemented, if applicable, will not contain any untrue
statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except that
the representations and warranties set forth in this Section 6(b) do
not apply to statements or omissions in the Registration Statement or
the Prospectus based upon information relating to you furnished to the
Company in writing by you expressly for use therein.
(c) Each preliminary prospectus filed as part of the registration
statement as originally filed or as part of any amendment thereto, or
filed pursuant to Rule 424 under the Act, and each Registration
Statement filed pursuant to Rule 462(b) under the Act, if any,
complied when so filed in all material respects with the Act; and did
not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading.
(d) Each of the Company and its subsidiaries (i) is duly
incorporated, validly existing as a corporation and in good standing
under the laws of its jurisdiction of incorporation, (ii) has full
corporate power and authority to carry on its business as it is
currently being conducted and to own, lease and operate its properties
and (iii) is duly qualified and in good standing as a foreign
corporation registered to do business in each jurisdiction in which
the nature of its business or its ownership or leasing of property
requires such qualification, except where the failure to be so
qualified would not have a material adverse effect on the condition
(financial or other), business, property, prospects, net worth or
results of operations of the Company and its subsidiaries taken as a
whole (a "Material Adverse Effect").
(e) (i) All of the outstanding shares of capital stock of the
Company and each of its subsidiaries have been duly authorized and
validly issued, are fully paid and nonassessable, are not and, as a
result of the Units Offering, will not be, subject to preemptive or
similar rights, (ii) except as described in the Prospectus, all shares
of the
7
Company's subsidiaries' capital stock are owned by the Company,
directly or indirectly, free and clear of any security interest,
claim, lien or encumbrance and (iii) except as described in the
Prospectus, there are no outstanding rights, warrants or options to
acquire, or instruments convertible into or exchangeable for, any
capital stock or other equity interest in the Company or any of its
subsidiaries.
(f) Neither the Company nor any of its subsidiaries is (i) in
violation of its respective charter or bylaws or (ii) in default in
any material respect in the performance of any obligation, agreement
or condition contained in any bond, debenture, note or any other
evidence of indebtedness or in any other agreement, indenture or
instrument material to the conduct of the business of the Company and
its subsidiaries taken as a whole, to which the Company or any of its
subsidiaries is a party or by which it or any of its subsidiaries or
their respective property is bound.
(g) None of (i) the execution, delivery or performance by the
Company of its obligations under this Agreement or the Indenture, (ii)
the adoption or performance by the Company of its obligations under
the Certificate of Designation, (iii) the issuance and sale of the
Units by the Company and (iv) the consummation by the Company of the
transactions described in the Prospectus under the caption "Use of
Proceeds," will conflict with or constitute a breach of any of the
terms or provisions of, or a default under, or result in the
imposition of a lien or encumbrance on any properties of the Company
or any of its subsidiaries, or an acceleration of indebtedness
pursuant to, (A) the charter or bylaws of the Company or any of its
subsidiaries, (B) any bond, debenture, note, indenture, mortgage, deed
of trust or other agreement or instrument to which the Company or any
of its subsidiaries is a party or by which any of them or their
property is bound, the violation of which would reasonably be expected
to result in a Material Adverse Effect, or (C) any law or
administrative regulation applicable to the Company, any of its
subsidiaries or any of their assets or properties, or any judgment,
order or decree of any court or governmental agency or authority
entered in any proceeding to which the Company or any of its
subsidiaries was or is now a party or to which any of them or their
respective properties may be subject.
(h) No consent, approval, authorization or order of, or filing or
registration with, any regulatory body, administrative agency, or
other governmental agency (except as securities or Blue Sky laws of
the various states may require) that has not been made or obtained is
required for (i) the execution, delivery and performance of the
Company's obligations under this Agreement or the Indenture, (ii) the
adoption and performance of the Company's obligations under the
Certificate of Designation, (iii) the valid issuance and
8
sale of the Securities or (iv) the performance by the Company of the
transactions contemplated hereby or by the Certificate of Designation
or the Indenture. No consents or waivers from any person are required
to consummate the transactions contemplated by this Agreement, the
Certificate of Designation, the Indenture, the Prospectus or the
Registration Statement, other than such consents and waivers as have
been or will be obtained prior to the Closing Date.
(i) The Company has all necessary corporate power and authority
to enter into or adopt, as the case may be, and perform its
obligations under this Agreement, the Certificate of Designation and
the Indenture and to issue, sell and deliver the Units to
Underwriters.
(j) This Agreement has been duly authorized and validly executed
by the Company and (assuming the due execution and delivery thereof by
you) is a legally valid and binding obligation of the Company,
enforceable against it in accordance with its terms, except as the
enforceability thereof may be (i) subject to applicable bankruptcy,
insolvency, moratorium, reorganization or similar laws in effect which
affect the enforcement of creditors' rights generally, (ii) limited by
general principles of equity (whether considered in a proceeding at
law or in equity) and (iii) limited by securities laws prohibiting or
limiting the availability of, and public policy against,
indemnification or contribution.
(k) The Certificate of Designation has been duly authorized by
all necessary corporate and stockholder action.
(l) The Indenture has been duly qualified under the Trust
Indenture Act of 1939, as amended.
(m) The Company has duly authorized the Indenture and, when
executed and delivered (assuming the due authorization, execution and
delivery thereof by the Trustee), the Indenture will be a legally
valid and binding obligation of the Company, enforceable against it in
accordance with its terms, except as the enforceability thereof may be
(i) subject to applicable bankruptcy, insolvency, moratorium,
reorganization or similar laws in effect which affect the enforcement
of creditors' rights generally and (ii) limited by general principles
of equity (whether considered in a proceeding at law or in equity).
(n) The Company has duly authorized the Units and, when issued
and delivered to you on the Closing Date against payment therefor as
provided by this Agreement, the Units will conform to the description
thereof in the Prospectus.
(o) The Company has duly authorized the Senior Preferred Stock
and, when issued and delivered to you on the Closing
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Date against payment therefor as provided by this Agreement, the
Senior Preferred Stock will be validly issued, fully paid,
non-assessable, will conform to the description thereof in the
Prospectus, and will be entitled to the rights, privileges and
preferences set forth in the Certificate of Designation, and the
issuance of such Senior Preferred Stock will not be subject to any
preemptive or similar rights.
(p) The Company has duly authorized the Common Stock and, when
issued and delivered to you against payment therefor as provided by
this Agreement, the Common Stock will be validly issued, fully paid
and nonassessable and will conform to the description thereof in the
Prospectus, and the issuance of such Common Stock will not be subject
to any preemptive or similar rights.
(q) The Company has duly authorized the Exchange Debentures and,
if and when issued and authenticated in accordance with the terms of
the Indenture and delivered in exchange for the Senior Preferred Stock
in accordance with the terms of the Certificate of Designation, the
Exchange Debentures will conform to the description thereof in the
Prospectus, and will be the legally valid and binding obligations of
the Company, enforceable against it in accordance with their terms,
except as the enforceability thereof may be (i) subject to applicable
bankruptcy, insolvency, moratorium, reorganization or similar laws in
effect which affect the enforcement of creditors' rights generally and
(ii) limited by general principles of equity (whether considered in a
proceeding at law or in equity).
(r) There is (i) no action, suit or proceeding before or by any
court, arbitrator or governmental agency, body or official, domestic
or foreign, now pending, or, to the knowledge of the Company,
threatened or contemplated to which the Company or any of its
subsidiaries is or may be a party or to which the business or property
of the Company or any of its subsidiaries is subject, (ii) no statute,
rule, regulation or order that has been enacted, adopted or issued by
any governmental agency or, to the best knowledge of the Company,
proposed by any governmental body and (iii) no injunction, restraining
order or order of any nature by a federal or state court of competent
jurisdiction to which the Company or any of its subsidiaries is or may
be subject issued that, in the case of clauses (i), (ii) and (iii)
above, (A) is required to be disclosed in the Registration Statement
or the Prospectus and that is not so disclosed, (B) might have a
Material Adverse Effect, (C) would interfere with or adversely affect
the issuance of the Securities or (D) in any manner draw into question
the validity of this Agreement, the Certificate of Designation, the
Indenture or the Securities.
(s) No holder of any security of the Company or any of its
subsidiaries has any right or, by reason of the execution
10
or adoption, as the case may be, by the Company of this Agreement, the
Certificate of Designation or the Indenture or the consummation of the
transactions contemplated hereby or thereby, will have the right to
require registration of any security of the Company.
(t) No contract or document of a character required to be
described in the Registration Statement or the Prospectus or to be
filed as an exhibit to the Registration Statement is not so described
or filed as required.
(u) Neither the Company nor any of its subsidiaries is involved
in any material labor dispute nor, to the knowledge of the Company or
any of its subsidiaries, is any material labor dispute threatened
which, if such dispute were to occur, could have a Material Adverse
Effect.
(v) Neither the Company nor any of its subsidiaries has violated
any safety or similar law applicable to its business, nor any federal
or state law relating to discrimination in the hiring, promotion or
pay of employees nor any applicable federal or state wages and hours
laws, nor any provisions of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), or the rules and regulations
promulgated thereunder, except for such instances of noncompliance
that, either singly or in the aggregate, could not have a Material
Adverse Effect.
(w) Each of the Company and its subsidiaries is in compliance
with all applicable existing federal, state, local and foreign laws
and regulations relating to the protection of human health or the
environment or imposing liability or standards of conduct concerning
any Hazardous Material (as defined below) (collectively,
"Environmental Laws"), except for such instances of noncompliance
that, either singly or in the aggregate, could 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 of 1976, 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
Environmental Law. There is no alleged liability, or, to the best
knowledge and information of the Company, potential liability
(including, without limitation, alleged or potential liability for
investigatory costs, cleanup costs, governmental response costs,
natural resources damages, property damages, personal injuries, or
penalties) of the Company or any of its subsidiaries arising out of,
based on, or resulting from (A) the presence or release into the
environment of any Hazardous Material at any location currently or
previously owned by the
11
Company or any of its subsidiaries or at any location currently or
previously used or leased by the Company or any of its subsidiaries or
(B) any violation or alleged violation of any Environmental Law,
except in each case with respect to clauses (A) and (B), alleged or
potential liabilities that, singly or in the aggregate, could not have
a Material Adverse Effect.
(x) Each of the Company and its subsidiaries owns or possesses
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, "Intellectual Property") presently employed by it in
connection with the businesses it now operates, except where the
failure to own or possess such Intellectual Property could not, either
singly or in the aggregate, have a Material Adverse Effect, and
neither the Company nor any of its subsidiaries has received any
notice that its use of any Intellectual Property allegedly infringes
upon, or conflicts with, rights asserted by others, except for such
instances that, singly or in the aggregate, could not have a Material
Adverse Effect if an unfavorable decision, judgment, ruling or finding
is rendered against the Company or any of its subsidiaries.
(y) Except as set forth in the Prospectus, all tax returns
required to be filed by each of the Company and its subsidiaries in
any jurisdiction have been filed, and all material taxes (including,
but not limited to, withholding taxes, penalties and interest,
assessments, fees and other charges due or claimed to be due from any
taxing authority) have been paid other than those (i) being contested
in good faith and for which adequate reserves have been provided, or
(ii) currently payable without penalty or interest.
(z) Except as set forth in the Prospectus or that, singly or in
the aggregate, could not have a Material Adverse Effect, (i) each of
the Company and its subsidiaries has (A) such permits, licenses,
franchises and authorizations of governmental or regulatory
authorities ("Permits") as are necessary to own, lease and operate its
properties and to conduct its business as presently conducted, and (B)
fulfilled and performed all of its material obligations with respect
to the Permits, and (ii) no event has occurred that could allow, or
after notice or lapse of time could allow, revocation or termination
of any Permit or that could result in any other material impairment of
the rights granted to the Company or any of its subsidiaries under any
Permit, and the Company has no reason to believe that any governmental
body or agency is considering limiting, suspending or revoking any
Permit.
12
(aa) Except as set forth in the Prospectus or that, singly or in
the aggregate, could not have a Material Adverse Effect, (i) each of
the Company and its subsidiaries has good and marketable title, free
and clear of all liens, claims, encumbrances and restrictions, except
liens for taxes not yet due and payable, to all property and assets
described in the Prospectus as being owned by it, (ii) each lease to
which the Company or any of its subsidiaries is a party is valid and
binding and no default has occurred or is continuing thereunder, and
(iii) each of the Company and its subsidiaries enjoys peaceful and
undisturbed possession under all such leases to which it is a party as
lessee.
(bb) Each of the Company and its subsidiaries maintains adequate
insurance for its businesses and the value of its properties
(including, without limitation, public liability insurance, third
party property damage insurance and replacement value insurance) and
all such insurance is outstanding and in force as of the date of this
Agreement.
(cc) The financial statements, together with the related
schedules and notes, forming part of the Registration Statement and
the Prospectus (and any amendment or supplement thereto) present
fairly the consolidated financial position, results of operations and
changes in financial position of the Company and its subsidiaries on
the basis stated in the Registration Statement at the respective dates
or for the respective periods to which they apply, and such financial
statements and related schedules and notes have been prepared in
accordance with generally accepted accounting principles consistently
applied throughout the periods involved, except as disclosed therein.
The pro forma financial statements, together with the related
schedules and notes, forming part of the Registration Statement and
the Prospectus (and any amendment or supplement thereto) are, in all
material respects, accurately presented and prepared in good faith on
the basis of the assumptions described therein, and such assumptions
are reasonable and the adjustments used therein are appropriate to
give effect to the transactions and circumstances referred to therein.
(dd) Each of the Company and its subsidiaries maintains a system
of internal accounting controls sufficient to provide 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 generally
accepted accounting principles and to maintain accountability for
assets; and
13
(iii) the recorded accountability for assets is compared
with the existing assets at reasonable intervals and appropriate
action is taken with respect thereto.
(ee) Subsequent to the dates for which information is given in
the Registration Statement and the Prospectus and up to the Closing
Date, unless set forth in the Registration Statement and the
Prospectus:
(i) none of the Company or its subsidiaries has incurred any
liabilities or obligations, direct or contingent, which are
material, singly or in the aggregate, to the Company and its
subsidiaries taken as a whole, nor entered into any material
transactions not in the ordinary course of business;
(ii) there has not been any decrease in the Company's
capital stock or the capital stock of any of the Company's
subsidiaries or any increase in long-term indebtedness to meet
working capital requirements or any material increase in
short-term indebtedness of the Company or any of its subsidiaries
or any payment of or declaration to pay any dividends or any
other distribution with respect to the Company's or any of its
subsidiaries' capital stock, as the case may be; and
(iii) there has not been any event or series of events that
would have a Material Adverse Effect.
(ff) Prior to and after the issuance of the Securities and the
Senior Notes, (i) the present fair salable value of the assets of the
Company and its subsidiaries exceeded and will exceed the amount that
will be required to be paid on, or in respect of, the debts and other
liabilities (including contingent liabilities) of the Company and its
subsidiaries as they become absolute and matured, (ii) the assets of
the Company and its subsidiaries do not constitute and will not
constitute unreasonably small capital to carry out their businesses as
conducted or as proposed to be conducted, and (iii) the Company and
its subsidiaries do not intend to, or believe that they will, incur
debts or other liabilities beyond their ability to pay such debts and
liabilities as they mature. The Company does not intend to, and does
not intend to permit any of its subsidiaries to, incur debts or other
liabilities beyond their respective ability to pay such debts and
liabilities as they mature.
(gg) The Company is not an "investment company" or a company
"controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.
(hh) Deloitte & Touche LLP are independent public accountants
with respect to the Company as required by the Act.
14
(ii) The Company has no direct or indirect subsidiaries other
than those listed on Exhibit 21 to the Registration Statement.
(jj) The execution and delivery of this Agreement and the
Indenture, the adoption of the Certificate of Designation and the sale
of the Units will not involve any prohibited transaction within the
meaning of Section 406 of ERISA or Section 4975 of the Code.
(kk) The Company has complied with all provisions of Section
517.075, Florida Statutes (Chapter 92-198, Laws of Florida).
7. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless DLJ and
each person, if any, who controls DLJ within the meaning of Section 15
of the Act or Section 20 of the Exchange Act from and against any and
all losses, claims, damages, liabilities and judgments caused by any
untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or the Prospectus (as amended
or supplemented if the Company shall have furnished any amendments or
supplements thereto) or any preliminary prospectus, or caused by any
omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein, not
misleading, except insofar as such losses, claims, damages,
liabilities or judgments are caused by any such untrue statement or
omission or alleged untrue statement or omission based upon
information relating to DLJ furnished in writing to the Company by DLJ
expressly for use therein; provided, however, that the indemnification
contained in this Section 7(a) with respect to any preliminary
prospectus shall not inure to the benefit of DLJ (or to the benefit of
any person controlling DLJ) on account of any such loss, claim,
damage, liability or judgment (i) arising from the sale of the Units
by DLJ to any person if a copy of the Prospectus shall not have been
delivered or sent to such person, at or prior to the written
confirmation of such sale, and the untrue statement or alleged untrue
statement or omission or alleged omission of a material fact contained
in such preliminary prospectus was corrected in the Prospectus,
provided that the Company has delivered the Prospectus to DLJ in
requisite quantity on a timely basis to permit such delivery or
sending or (ii) resulting from the use by DLJ of any registration
statement or prospectus, or any amendment or supplement thereto,
referred to in Section 5(e) when, under Xxxxxxx 00 xxxxxx, XXX was not
permitted to do so.
(b) In case any action shall be brought against DLJ or any person
controlling DLJ based upon any preliminary prospectus, the
Registration Statement or the Prospectus or
15
any amendment or supplement thereto and with respect to which
indemnity may be sought against the Company, DLJ shall promptly notify
the Company in writing and the Company shall assume the defense
thereof, including the employment of counsel reasonably satisfactory
to such indemnified party and payment of all fees and expenses. DLJ or
any such controlling person shall have the right to employ separate
counsel in any such action and participate in the defense thereof, but
the reasonable fees and expenses of such counsel shall be at the
expense of DLJ or such controlling person unless (i) the employment of
such counsel has been specifically authorized in writing by the
Company, (ii) the Company has failed to assume the defense and employ
counsel or (iii) the named parties to any such action (including any
impleaded parties) include both DLJ or such controlling person and the
Company and DLJ or such controlling person shall have been advised by
such counsel that there may be one or more legal defenses available to
it which are different from or additional to those available to the
Company (in which case the Company shall not have the right to assume
the defense of such action on behalf of DLJ or such controlling
person, it being understood, however, that the Company shall not, in
connection with any one such action or separate but substantially
similar or related actions in the same jurisdiction arising out of the
same general allegations or circumstances, be liable for the fees and
expenses of more than one separate firm of attorneys (in addition to
any local counsel) for DLJ and all such controlling persons, which
firm shall be designated in writing by DLJ, and that all such fees and
expenses shall be reimbursed as they are incurred). The Company shall
not be liable for any settlement of any such action effected without
the written consent of the Company but, if settled with the Company's
written consent, the Company agrees to indemnify and hold harmless DLJ
and any such controlling person from and against any loss or liability
by reason of such settlement. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement
of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such
settlement includes an unconditional release of such indemnified party
from all liability on claims that are the subject matter of such
proceeding.
(c) DLJ agrees to indemnify and hold harmless the Company, its
directors, its officers who sign the Registration Statement and any
person controlling them within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act (collectively, the "Company Indemnified
Parties"), to the same extent as the foregoing indemnity from the
Company to DLJ but only with reference to information relating to DLJ
furnished in writing by DLJ expressly for use in the Registration
Statement, the Prospectus or any preliminary prospectus. In case any
action shall be brought against any Company
16
Indemnified Party based on the Registration Statement, the Prospectus
or any preliminary prospectus in respect of which indemnity may be
sought against DLJ, DLJ shall have the rights and duties given to the
Company (except that if the Company shall have assumed the defense
thereof, DLJ shall not be required to do so, but may employ separate
counsel therein and participate in the defense thereof but the fees
and expenses of such counsel shall be at the expense of DLJ), and the
Company Indemnified Parties shall have the rights and duties given to
DLJ by Section 7(b) hereof.
(d) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party in respect of any losses, claims,
damages, liabilities or judgments referred to therein, then each
indemnifying party, in lieu of indemnifying such indemnified party,
shall contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages, liabilities and
judgments (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and DLJ on
the other hand from the offering of the Units or (ii) if the
allocation provided by clause (i) above is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the
relative fault of the Company and DLJ in connection with the
statements or omissions which resulted in such losses, claims,
damages, liabilities or judgments, as well as any other relevant
equitable considerations. The relative benefits received by the
Company and DLJ shall be deemed to be in the same proportion as the
total net proceeds from the offering of the Units (before deducting
expenses) received by the Company, and the total underwriting
discounts and commissions received by DLJ, bear to the total price to
the public of the Units, in each case as set forth in the table on the
cover page of the Prospectus. The relative fault of the Company and
DLJ shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by
the Company or DLJ and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or
omission.
The Company and DLJ agree that it would not be just and equitable
if contribution pursuant to this Section 7(d) were determined by pro
rata allocation or by any other method of allocation which does not
take account of the equitable considerations referred to in the
immediately preceding paragraph. The losses, claims, damages,
liabilities or judgments of an indemnified party referred to in the
immediately preceding paragraph shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding
the provisions of this Xxxxxxx 0, XXX
00
shall not be required to contribute any amount in excess of the amount
by which the discounts and commissions received by it exceeds the
amount of any damages which DLJ has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
(e) The Company hereby designates The Jordan Company, 0 Xxxx 00xx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, as its authorized agent, upon which
process may be served in any action, suit or proceeding which may be
instituted in any state or federal court in the State of New York by
DLJ or any, or person controlling DLJ asserting a claim for
indemnification or contribution under or pursuant to this Section 7,
and the Company will accept the jurisdiction of such court in such
action, and waive, to the fullest extent permitted by applicable law,
any defense based upon lack of personal jurisdiction or venue. A copy
of any such process shall be sent or given to the Company, at the
address for notices specified in Section 11(a) hereof.
(f) The indemnity and contribution agreements contained in this
Section 7 are in addition to any liability which the indemnifying
persons may otherwise have to the indemnified persons referred to
above.
8. CONDITIONS OF THE DLJ'S OBLIGATIONS. The obligations of DLJ to
purchase the Units under this Agreement are subject to the satisfaction of each
of the following conditions:
(a) All the representations and warranties of the Company
contained in this Agreement shall be true and correct on the date
hereof and on the Closing Date, with the same force and effect as if
made on and as of the date hereof and the Closing Date, respectively.
The Company shall have performed or complied with all of the
agreements and satisfied all conditions to be performed, complied with
or satisfied by it on or prior to the Closing Date.
(b) The Registration Statement shall have become effective not
later than 5:00 p.m. (and in the case of a Registration Statement
filed under Rule 462(b) of the Act, not later than 10:00 p.m.),
Eastern Standard Time, on the date of this Agreement or at such later
date and time as you may approve in writing, and at the Closing Date
no stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose
shall have been commenced or shall be pending before or contemplated
by the Commission.
18
(c) Subsequent to the execution and delivery of this Agreement
and prior to the Closing Date, there shall not have been any
downgrading, nor shall any notice have been given of any intended or
potential downgrading or of any review for a possible change that does
not indicate the direction of the possible change, in the rating
accorded any of the Company's securities by any "nationally recognized
statistical rating organization," as such term is defined for purposes
of Rule 436(g)(2) under the Act.
(d) (i) The Prospectus shall have been printed and copies
distributed to DLJ not later than 9:00 a.m., Eastern Standard Time, on
________________, 1996, or at such later date and time as DLJ may
approve in writing; and
(ii) no injunction, restraining order or order of any nature
by a federal or state court of competent jurisdiction shall have
been issued as of the Closing Date which would prevent the
issuance of the Units.
(e) (i) Since the date of the latest balance sheet included in
the Registration Statement and the Prospectus, there shall not have
been any event that had a Material Adverse Effect, or any development
involving a prospective change that could have a Material Adverse
Effect, whether or not arising in the ordinary course of business;
(ii) since the date of the latest balance sheet included in
the Registration Statement and the Prospectus, there shall not
have been any change, or any development involving a prospective
change, in the capital stock or in the long-term debt of the
Company and its subsidiaries from that set forth in the
Registration Statement and the Prospectus;
(iii) the Company and its subsidiaries shall have no
material liability or obligation, direct or contingent, other
than those reflected in the Registration Statement and the
Prospectus; and
(iv) on the Closing Date you shall have received
certificates dated the Closing Date, signed on behalf of the
Company by the Chief Executive Officer and the Chief Financial
Officer of the Company, confirming all of the matters set forth
in Sections 8(a), (b), (c), (d) and (e) of this Agreement with
respect to the Company.
(f) You shall have received on the Closing Date an opinion
(satisfactory to you and counsel to you) dated the Closing Date, of
Xxxxx, Xxxxx & Xxxxx, counsel to the Company (provided that the
opinions with respect to subsidiaries of the Company incorporated in
the states of Colorado, Illinois, Michigan and Ohio will be provided
by Xxxxxxxx & Xxxxxx), to the effect that:
19
(i) based on telephonic confirmation from the Commission,
the Registration Statement has become effective under the Act
and, to the knowledge of such counsel, no stop order suspending
its effectiveness has been issued and no proceedings for that
purpose are pending before, threatened or contemplated by the
Commission;
(ii) the Registration Statement (including any Registration
Statement filed under Rule 462(b) of the Act, if any) and the
Prospectus and any supplement or amendment thereto (except for
financial statements as to which no opinion need be expressed)
comply as to form in all material respects with the Act;
(iii) each of the Company and its subsidiaries is duly
incorporated, validly existing as a corporation in good standing
under the laws of its jurisdiction of incorporation and has the
full corporate power and authority required to carry on its
business as it is currently being conducted and to own, lease and
operate its properties;
(iv) each of the Company and its subsidiaries is duly
qualified and in good standing as a foreign corporation
registered to do business in each jurisdiction in which the
nature of its business or its ownership or leasing of property
requires such qualification, except where the failure to be so
qualified would not have a Material Adverse Effect;
(v) all of the outstanding shares of capital stock of the
Company and each of its subsidiaries have been duly authorized
and validly issued, are fully paid and non-assessable, are not
subject to preemptive or similar rights and all shares of the
Company's subsidiaries' capital stock are owned, directly or
indirectly, by the Company, to the best of such counsel's
knowledge, free and clear of any security interest, claim, lien
or encumbrance;
(vi) to such counsel's knowledge, except as disclosed in the
Prospectus, there are no outstanding rights, warrants or options
to acquire, or instruments convertible into or exchangeable for,
any capital stock, or other equity interest, in the Company or
any of its subsidiaries;
(vii) neither the Company nor any of its subsidiaries is in
violation of its respective charter or bylaws and, to the
knowledge of such counsel after due inquiry, neither the Company
nor any of its subsidiaries is in default in the performance of
any obligation, agreement or condition contained in any bond,
debenture,
20
note or any other evidence of indebtedness or in any other
agreement, indenture or instrument material to the conduct of the
business of the Company and its subsidiaries taken as a whole, to
which the Company or any of its subsidiaries is a party or by
which it or any of its subsidiaries or their respective property
is bound;
(viii) none of (A) the execution, delivery or performance by
the Company of this Agreement or the Indenture, (B) the adoption
or performance by the Company of the Certificate of Designation,
(C) the issuance and sale of the Units by the Company and (D) the
consummation by the Company of the transactions described in the
Prospectus under the caption "Use of Proceeds," will conflict
with or constitute a breach of any of the terms or provisions of,
or a default under, or result in the imposition of a lien or
encumbrance on any properties of the Company or any of its
subsidiaries, or an acceleration of indebtedness pursuant to, (1)
the charter or bylaws of any of the Company or the Company's
subsidiaries, (2) any bond, debenture, note, indenture, mortgage,
deed of trust or other agreement or instrument known to such
counsel after due inquiry to which the Company or any of its
subsidiaries is a party or by which any of them or their property
is bound, or (3) to such counsel's knowledge, any law or
administrative regulation applicable to the Company, any of its
subsidiaries or any of their assets or properties, or any
judgment, order or decree of any court or governmental agency or
authority entered in any proceeding to which the Company or any
of its subsidiaries was or is now a party or to which any of them
or their respective properties may be subject and which is known
to such counsel;
(ix) no consent, approval, authorization or order of, or
filing or registration with, any regulatory body, administrative
agency, or other governmental agency (except as securities or
Blue Sky laws of the various states may require) that has not
been made or obtained is required for (A) the execution, delivery
and performance of this Agreement or the Indenture, (B) the
adoption or performance of the Certificate of Designation, (C)
the valid issuance and sale of the Securities or (D) the
performance by the Company of the transactions contemplated
hereby, by the Certificate of Designation or by the Indenture,
such as to which the failure to be obtained or made would not
reasonably be expected, either singly or in the aggregate, to
have a Material Adverse Effect;
(x) to such counsel's knowledge, no consents or waivers from
any person are required to consummate the transactions
contemplated by this Agreement, the
21
Certificate of Designation or the Indenture, other than such
consents and waivers as have been or will be obtained prior to
the Closing Date;
(xi) the Company has all necessary corporate power and
authority to enter into and perform its obligations under this
Agreement, the Certificate of Designation and the Indenture, to
adopt and perform its obligations under the Certificate of
Designation and to issue, sell and deliver the Units to DLJ to be
sold by DLJ pursuant to this Agreement;
(xii) this Agreement has been duly authorized and validly
executed by the Company and (assuming the due execution and
delivery thereof by you) is a legally valid and binding
obligation of the Company, enforceable against it in accordance
with its terms, except as the enforceability thereof may be (A)
subject to applicable bankruptcy, insolvency, moratorium,
reorganization or similar laws in effect which affect the
enforcement of creditors' rights generally, (B) limited by
general principles of equity (whether considered in a proceeding
at law or in equity) and (C) limited by securities laws
prohibiting or limiting the availability of, and public policy
against, indemnification or contribution.
(xiii) the Certificate of Designation has been duly
authorized by all necessary corporate and stockholder action and,
based on oral confirmation therefrom, has been filed with the
Secretary of State of the State of Delaware;
(xiv) the Indenture has been duly qualified under the Trust
Indenture Act of 1939, as amended;
(xv) the Company has duly authorized the Indenture and, when
executed and delivered (assuming due authorization, execution and
delivery of the Indenture by the Trustee), the Indenture will be
a legally valid and binding obligation of the Company,
enforceable against it in accordance with its terms, except as
the enforceability thereof may be (A) subject to applicable
bankruptcy, insolvency, moratorium, reorganization or similar
laws in effect which affect the enforcement of creditors rights
generally and (B) limited by general principles of equity
(whether considered in a proceeding at law or in equity);
(xvi) the Company has duly authorized the Units and, when
issued and delivered to DLJ against payment therefor as provided
by this Agreement, the Units will conform to the description
thereof in the Prospectus;
22
(xvii) the Company has duly authorized the Senior Preferred
Stock and, when issued and delivered to DLJ against payment
therefor as provided by this Agreement, will be validly issued,
fully paid and non-assessable, will conform to the description
thereof in the Prospectus, and will be entitled to the rights,
privileges and preferences set forth in the Certificate of
Designation, and the issuance of such Senior Preferred Stock is
not subject to any preemptive or similar rights;
(xviii) the Company has duly authorized the Common Stock
and, when issued and delivered to DLJ against payment therefor as
provided by this Agreement, the Common Stock will be validly
issued, fully paid and nonassessable and will conform to the
description thereof in the Prospectus, and the issuance of such
Common Stock is not subject to any preemptive or similar rights;
(xix) the Company has duly authorized the Exchange
Debentures and, when issued and authenticated in accordance with
the terms of the Indenture and delivered in exchange for the
Senior Preferred Stock in accordance with the terms of the
Certificate of Designation, the Exchange Debentures will conform
to the description thereof in the Prospectus, and will be the
legally valid and binding obligations of the Company, enforceable
against it in accordance with their terms, except as the
enforceability thereof may be (i) subject to applicable
bankruptcy, insolvency, moratorium, reorganization or similar
laws in effect which affect the enforcement of creditors' rights
generally and (ii) limited by general principles of equity
(whether considered in a proceeding at law or in equity);
(xx) to the knowledge of such counsel, after due inquiry,
there is (i) no action, suit or proceeding before or by any
court, arbitrator or governmental agency, body or official,
domestic or foreign, now pending, threatened or contemplated to
which the Company or any of its subsidiaries is or may be a party
or to which the business or property of the Company or any of its
subsidiaries is or may be subject, (ii) no statute, rule,
regulation or order that has been enacted, adopted or issued by
any governmental agency or proposed by any governmental body, or
(iii) no injunction, restraining order or order of any nature by
a federal or state court of competent jurisdiction applicable to
the Company or any of its subsidiaries has been issued that, in
the case of clauses (i), (ii) and (iii) above, (a) is required to
be disclosed in the Registration Statement or the Prospectus and
that is not so disclosed, (b) would interfere with or adversely
affect the issuance of the Units, or (c) might invalidate any
provision or the
23
validity of this Agreement, the Certificate of Designation, the
Indenture or the Securities;
(xxi) to such counsel's knowledge, after due inquiry, no
holder of any security of the Company has any right to require
registration of any security of the Company;
(xxii) the statements under the captions "Description of
Securities," "Description of Certain Indebtedness," "Certain
Transactions," and "Certain Federal Income Tax Considerations" in
the Prospectus, as amended or supplemented, and Item 14 and,
assuming the accuracy of the representations and warranties of
the Company at the time of the transactions referred to therein,
which such counsel has no reason to believe are inaccurate, Item
15 of Part II of the Registration Statement, insofar as such
statements constitute a summary of legal matters, documents or
proceedings referred to therein, present fairly the information
called for with respect to such legal matters, documents or
proceedings;
(xxiii) the Company is not an "investment company" or a
company "controlled" by an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
In addition, such counsel shall state that it has participated in
conferences with certain officers and other representatives of the
Company, representatives of the Company's accountants, your
representatives and counsel to you, at which conferences the contents
of the Registration Statement and Prospectus and any amendments or
supplements thereto, and related matters were discussed, and, although
such counsel has not independently verified and is not passing upon
and assumes no responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement and
the Prospectus, and any amendment or supplement thereto, no facts have
come to such counsel's attention which led it to believe that the
Registration Statement as of the effective date or on the date of such
opinion contained or contains an untrue statement of a material fact
or omitted or omits to state a material fact necessary to make the
statements contained therein not misleading, and that the Prospectus,
as of the date thereof or on the date of such opinion, contained or
contains an untrue statement of a material fact or omitted or omits to
state a material fact necessary to make the statements contained
therein, in light of the circumstances under which they were made, not
misleading (it being understood that such counsel need express no view
with respect to the financial statements and data and related notes,
the financial statement schedules
24
and other financial, statistical and accounting data included
in the Registration Statement and Prospectus).
(g) You shall have received on the Closing Date an opinion, dated
the Closing Date, of Xxxxxx & Xxxxxxx, counsel to you, in form and
substance reasonably satisfactory to you, and the Company shall have
provided Xxxxxx & Xxxxxxx such papers and information as it requests
to enable it to pass upon the matters contained in such opinion.
(h) You shall have received letters from Deloitte & Touche LLP,
independent public accountants, on the date hereof and on the Closing
Date, in form and substance satisfactory to you, with respect to the
financial statements and certain financial information contained in
the Registration Statement and the Prospectus.
(i) The Company shall have filed the Certificate of Designation
with the Secretary of State of the State of Delaware and you shall
have received evidence thereof satisfactory to you.
(j) The Company and the Trustee shall have entered into the
Indenture and you shall have received counterparts, conformed as
executed thereof.
(k) The Company shall have fully performed or complied with all
of the agreements contained in this Agreement and required to be
performed or complied with by the Company on or prior to the Closing
Date.
(l) On the Closing Date, the Notes Offering shall be consummated
on substantially the same terms as those set forth in the Registration
Statement and the Prospectus.
9. EFFECTIVE DATE OF AGREEMENT AND TERMINATION. This Agreement shall
become effective upon the later of (i) the execution of this Agreement or (ii)
when notification of the effectiveness of the Registration Statement has been
released by the Commission.
This Agreement may be terminated at any time prior to the Closing Date
by you by written notice to the Company if any of the following has occurred:
(a) Since the respective dates as of which information is given
in the Registration Statement and the Prospectus, any adverse change
or development involving a prospective adverse change which would
cause a Material Adverse Effect, on the earnings, affairs, or business
prospects of the Company or any of its subsidiaries, whether or not
arising in the ordinary course of business, which would, in your
judgment, make it
25
impracticable to market the Units on the terms and in the manner
contemplated in the Prospectus;
(b) Any outbreak or escalation of hostilities or other national
or international calamity or crisis or material change in economic
conditions, if the effect of such outbreak, escalation, calamity,
crisis or change on the financial markets of the United States or
elsewhere would, in your judgment, be material and adverse and make it
impracticable to market the Units on the terms and in the manner
contemplated in the Prospectus;
(c) The suspension or material limitation of trading in
securities on the New York Stock Exchange, the American Stock Exchange
or the Nasdaq National Market or the limitation on prices for
securities on any such exchange or National Market System;
(d) The enactment, publication, decree or other promulgation of
any federal or state statute, regulation, rule or order of any court
or other governmental authority which in your opinion causes or will
cause a Material Adverse Effect;
(e) The declaration of a banking moratorium by either federal or
New York State authorities;
(f) The taking of any action by any federal, state or local
government or agency in respect of its monetary or fiscal affairs
which in your opinion has a material adverse effect on the financial
markets in the United States; or
(g) Any of the Company's securities shall have been downgraded or
placed on any "watch list" for possible downgrading by any nationally
recognized statistical rating organization, provided that in the case
of such "watch list" placement, termination shall be permitted only if
such placement would, in your judgment, make it impracticable or
inadvisable to market the Units or to enforce contracts for the sale
of the Units or materially impair the investment quality of any of the
Securities.
10. AGREEMENT OF DLJ.
DLJ agrees that, upon its receipt of any written notice from the
Company of the existence of any fact or the happening of any event that
requires the making of any additions to or changes in the Registration
Statement or the Prospectus or any amendment or supplement thereto in order
that such document will not contain any 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 existing as of the date such
document was delivered, not misleading, DLJ shall forthwith discontinue
disposition of the Units pursuant to such document until (i) DLJ
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receives from the Company copies of an amended or supplemented document that
the Company states in writing may be used by DLJ or (ii) DLJ is advised in
writing by the Company that the use of such document may be resumed.
11. MISCELLANEOUS.
(a) Notices given pursuant to any provision of this Agreement
shall be addressed as follows: (i) if to the Company, to AmeriKing,
Inc., 0000 Xxxxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxxxxxx, Xxxxxxxx 00000,
Attention: Chief Financial Officer, with a copy to Xxxxx, Xxxxx &
Xxxxx, 0000 Xxxxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Xxxxx X. Xxxxxxx, and (ii) if to DLJ, to Xxxxxxxxx, Lufkin & Xxxxxxxx
Securities Corporation, 000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Syndicate Department and Compliance Department, with a copy
to Xxxxxx & Xxxxxxx, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxxxx X. Xxxxxxxx, or in any case to such other address as
the person to be notified may have requested in writing.
(b) The respective indemnities, contribution agreements,
representations, warranties and other statements set forth in or made
pursuant to this Agreement shall remain operative and in full force
and effect, and will survive delivery of and payment for the Units,
regardless of (i) any investigation, or statement as to the results
thereof, made by or on behalf of any such person, (ii) acceptance of
the Units and payment for them under this Agreement and (iii)
termination of this Agreement.
(c) Except as otherwise provided, this Agreement has been and is
made solely for the benefit of and shall be binding upon the Company,
DLJ, any controlling persons referred to herein and their respective
successors and assigns, all as and to the extent provided in this
Agreement, and no other person shall acquire or have any right under
or by virtue of this Agreement. The term "successors and assigns"
shall not include a purchaser of the Units from DLJ merely because of
such purchase.
(d) This Agreement shall be construed, interpreted and the rights
of the parties determined in accordance with the laws of the State of
New York without reference to its choice of law provisions.
(e) This Agreement may be signed in various counterparts which
together shall constitute one and the same instrument.
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Please confirm that the foregoing correctly sets forth the agreement
between the Company and DLJ.
Very truly yours,
AMERIKING, INC.
By:
--------------------------------
Name:
Title:
XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
By:
-------------------------------
Name:
Title:
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