Exhibit 1.1
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UNDERWRITING AGREEMENT
CANANDAIGUA BRANDS, INC.
(Pounds)80,000,000 of 8 1/2% Series C Senior Notes due 2009
May 5, 2000
BARCLAYS BANK PLC
0 Xxx Xxxxx Xxxxxxxxx
Xxxxxx Xxxxx
Xxxxxx X00 0XX
Ladies and Gentlemen:
Canandaigua Brands, Inc., a Delaware corporation (the "Company"), by
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this agreement (the "Agreement") proposes to issue and sell to Barclays Bank PLC
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(the "Underwriter") (Pounds)80,000,000 aggregate principal amount of its 8 1/2%
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Series C Senior Notes due 2009 (the "Notes"). The Notes will initially be
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unconditionally guaranteed (the "Guarantees" and, together with the Notes, the
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"Securities") by each of: Batavia Wine Cellars, Inc., Canandaigua Wine Company,
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Inc., Canandaigua Europe Limited, Xxxxxxx Trading Corp., Polyphenolics, Inc.,
and Xxxxxx Distillers Import Corp., each a New York corporation, Xxxxxx
Incorporated, Xxxxxx Brands, Ltd., Xxxxxx Financial Corporation and Franciscan
Vineyards, Inc., each a Delaware corporation, Xxxxxx Xxxxx, Ltd., a Maryland
corporation, Xxxxxx Brands of California, Inc., a Connecticut corporation,
Xxxxxx Brands of Georgia, Inc., a Georgia corporation, Xxxxxxx Point Beverage
Co., a Wisconsin corporation, Monarch Import Company and Xxxxxx Canada, Ltd.,
each an Illinois corporation, Xxxxxxxx, Inc., Cloud Peak Corporation, X.X. Xxxxx
Corp. and Mt. Xxxxxx Corporation, each a California Corporation, Canandaigua
Limited, a company organized under the laws of England and Wales, and
Canandaigua B.V., a company organized under the laws of the Kingdom of the
Netherlands (collectively, the "Guarantors" and, together with the Company, the
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"Issuers"). The Securities are to be issued under an indenture dated February
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25, 1999 (the "Initial Indenture") as supplemented by Supplemental Indenture No.
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3 dated August 6, 1999 (the "Third Supplemental Indenture" and together with the
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Initial Indenture, the "Base Indenture"), as further supplemented by Amend-
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ment No. 4 to be dated May 15, 2000 (the "Fourth Supplemental Indenture" and
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together with the Base Indenture, the "Indenture").
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The Issuers have prepared and filed with the Securities and Exchange
Commission (the "Commission") in accordance with the provisions of the
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Securities Act of 1933, as amended, and the rules and regulations of the
Commission thereunder (collectively, the "Securities Act"), a registration
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statement (file number 333-91587) on Form S-3, relating to certain securities
(the "Shelf Securities") to be issued from time to time by the Issuers, as the
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case may be. The Issuers have also filed with, or propose to file with, the
Commission pursuant to Rule 424 under the Securities Act ("Rule 424") a
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prospectus supplement specifically relating to the Securities (a "Prospectus
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Supplement"). The registration statement as amended to the date of this
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Agreement and including any registration statement filed pursuant to Rule 462(B)
under the Securities Act (a "Rule 462(B) Registration Statement") is hereinafter
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referred to as the "Registration Statement" and the related prospectus covering
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the Shelf Securities in the form first used to confirm sales of the Securities
is hereinafter referred to as the "Basic Prospectus." The Basic Prospectus as
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supplemented by any applicable Prospectus Supplement specifically relating to
the Securities in the form first used to confirm sales of the Securities is
hereinafter referred to as the "Prospectus." Any reference in this Agreement to
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the Registration Statement, the Basic Prospectus, any preliminary form of
Prospectus (a "Preliminary Prospectus") previously filed with the Commission
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pursuant to Rule 424 or the Prospectus shall be deemed to refer to and include
the documents incorporated by reference therein pursuant to Item 12 of Form S-3
under the Securities Act that were filed under the Securities Exchange Act of
1934, as amended, and the rules and regulations of the Commission thereunder
(collectively, the "Exchange Act") on or before the date of this Agreement or
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the date of the Registration Statement, the Basic Prospectus, any Preliminary
Prospectus or the Prospectus, as the case may be; and any reference to "amend,"
"amendment" or "supplement" with respect to the Registration Statement, the
Basic Prospectus, any Preliminary Prospectus or the Prospectus shall be deemed
to refer to and include any documents filed under the Exchange Act after the
date of this Agreement, or the date of the Registration Statement, the Basic
Prospectus, any Preliminary Prospectus or the Prospectus, as the case may be,
which are deemed to be incorporated by reference therein.
The Issuers hereby agree with the Underwriter as follows:
1. The Issuers hereby agree to issue and sell the Securities to the
Underwriter as hereinafter provided, and the Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees to purchase from the Issuers (Pounds)80,000,000
aggregate principal amount of Securities at the applicable purchase price set
forth in Schedule I hereto.
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2. The Issuers understand that the Underwriter intends (i) to make an
offering in the United States and Europe of the Securities and (ii) initially to
offer the Securities upon the terms set forth in the Prospectus.
The Underwriter represents and agrees with the Issuers that (i) it has
not offered or sold, and, before the expiry of six months from the Closing Date,
will not offer or sell, any Securities to persons in the United Kingdom, except
to persons whose ordinary activities involve them in acquiring, holding,
managing or disposing of investments (as principal or agent) for purposes of
their business, or otherwise in circumstances which have not resulted and will
not result in an offer to the public in the United Kingdom within the meaning of
the Public Offers of Securities Regulations 1995; (ii) it has complied and will
comply with all applicable provisions of the Financial Services Xxx 0000 with
respect to anything done by it in relation to the Securities in, from or
otherwise involving the United Kingdom; and (iii) it is a person of a kind
described in Article 11(3) of the Financial Services Xxx 0000 (Investment
Advertisements) (Exemptions) Order 1996 (as amended) or is a person to whom the
document may otherwise lawfully be issued or passed on.
The Underwriter further represents and agrees with the Issuers that,
with respect to offers or sales made in jurisdictions outside of the United
States or the United Kingdom, it has made or will make such offers or sales in
compliance with applicable law.
3. Payment for the Securities shall be made to the Company or to its
order in immediately available funds on the date and at the time and place set
forth in Schedule I hereto (or at such other time and place on the same or such
other date, not later than the fifth Business Day thereafter, as the Underwriter
and the Company may agree in writing). The time and date of such payment for the
Securities are referred to herein as the "Closing Date." Such payment will be
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made upon delivery to the Underwriter of the Securities registered in such names
and in such denominations as the Underwriter shall request not less than two
full Business Days prior to the date of delivery, with any transfer taxes
payable in connection with transfer to the Underwriter duly paid by the Company.
As used herein, the term "Business Day" means any day other than a day on which
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banks are permitted or required to be closed in New York, New York or London,
England. The Securities will be delivered through the book-entry facilities of
either the Euroclear System ("Euroclear") or Clearstream Banking Luxembourg
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("Clearstream") or such other facility as the Underwriter shall reasonably
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request. The Securities will be made available for inspection by the Underwriter
at the office of Xxxxxx Xxxxxx & Xxxxxxx at 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 not later than 1:00 P.M., New York City time, on the Business Day prior to
the Closing Date.
4. Each of the Issuers, jointly and severally, represents and
warrants to the Underwriter that:
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(a) The Registration Statement has (i) been prepared by the Company
in conformity with the requirements of the Securities Act, (ii) been filed
with the Commission under the Securities Act and (iii) become effective
under the Securities Act. Copies of such registration statement and any
amendments thereto, as well as copies of the Preliminary Prospectus, have
been delivered by the Company to you. "Effective Time" means the date and
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the time as of which the Registration Statement, or the most recent post-
effective amendment thereof, if any, was declared effective by the
Commission; and "Effective Date" means the date of the Effective Time. The
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Commission has not issued any order preventing or suspending the use of the
Prospectus or the effectiveness of the Registration Statement.
(b) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will, when they become effective or are filed with the
Commission, as the case may be, conform, in all material respects to the
requirements of the Securities Act and the Trust Indenture Act of 1939, as
amended (the "Trust Indenture Act"), and do not and will not, as of the
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applicable Effective Date (as to the Registration Statement and any
amendment thereto) and as of the applicable filing date (as to the
Prospectus and any amendment or supplement thereto), contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein (in the case
of the Prospectus, in light of the circumstances in which they were made)
not misleading; on the Closing Date, the Indenture will conform in all
material respects to the applicable requirements of the Trust Indenture Act
and the rules and regulations of the Commission thereunder; and, at the
Effective Time, the Prospectus, if not filed pursuant to Rule 424(b), did
not or will not, and on the date of any filing pursuant to Rule 424(b) and
on the Closing Date, the Prospectus (together with any supplement thereto)
will not, include any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading. The
preceding sentence does not apply to (i) that part of the Registration
Statement which shall constitute the Statement of Eligibility and
Qualifications (Form T-1) of the Trustee under the Trust Indenture Act or
(ii) information contained in or omitted from the Registration Statement or
the Prospectus in reliance upon and in conformity with written information
furnished to the Company by or on behalf of the Underwriter expressly for
use therein (the "Underwriter's Information"). It is hereby understood and
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agreed that the only such information furnished by the Underwriter consists
of its name contained in the Registration Statement and the Prospectus and
the information in the third, and the last three paragraphs (including the
information set forth in the
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bullet points in the penultimate paragraph) under the heading "Plan of
Distribution" in the Prospectus Supplement.
(c) The Luxembourg Stock Exchange memorandum of listing particulars
(the "Listing Particulars"), in the form approved by the Luxembourg Stock
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Exchange, will not, as of its date, include any untrue statement of a
material fact or omit to state a material fact necessary in order to make
the statements therein, in light of the circumstances under which they were
made, not misleading.
(d) The documents incorporated or deemed to be incorporated by
reference in the Prospectus, when they became effective or were filed with
the Commission, as the case may be, conformed in all material respects to
the requirements of the Securities Act or the Exchange Act, as applicable,
and the rules and regulations of the Commission thereunder, and none of
such documents contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to make
the statements therein not misleading; and any further documents so filed
and incorporated by reference in the Prospectus, when such documents become
effective or are filed with the Commission, as the case may be, will
conform in all material respects to the requirements of the Securities Act
or the Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading.
(e) 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 complied when so filed in all material respects with
the Securities 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, except that the representations
and warranties set forth in this paragraph do not apply to the
Underwriter's Information.
(f) The Company and each of its consolidated subsidiaries (the
"Subsidiaries") have been duly incorporated and are validly existing as
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corporations in good standing under the laws of their respective
jurisdictions of incorporation, with full power and authority (corporate
and other) to own their properties and conduct their respective businesses
as described in the Prospectus, and are duly qualified to transact business
as foreign corporations in good standing under the laws of each
jurisdiction where the ownership or leasing of their respective properties
or the conduct of their respective businesses require such qualification,
except where the failure to so qualify would not have a material adverse
effect on the business, management, condition (fi-
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nancial or otherwise), results of operations or business prospects of the
Company and its Subsidiaries considered as a whole (a "Material Adverse
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Effect"); the Company had at the dates indicated an authorized
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capitalization as set forth in the Prospectus, and the issued shares of
capital stock of the Company have been duly authorized and validly issued
and are fully paid and non-assessable, and the outstanding shares of
capital stock of each of the Company's Subsidiaries have been duly
authorized and validly issued, are fully paid and non-assessable and
(except for directors' qualifying shares) are owned beneficially by the
Company free and clear of all liens, encumbrances, equities and claims
(collectively, "Liens") except for the Liens under the Credit Agreement,
dated as of October 6, 1999, between the Company, the guarantors named
therein, the lenders signatory thereto, The Chase Manhattan Bank, as
Administrative Agent, the Bank of Nova Scotia, as Syndication Agent and
Credit Suisse First Boston and Citicorp USA, Inc. as Co-Documentation
Agents (the "Credit Agreement"). Neither the Company nor any of the
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Guarantors is in violation of its respective charter or bylaws and neither
the Company nor any of the Guarantors is in default (nor has an event
occurred with notice, lapse of time or both that would constitute a
default) in the performance of any obligation, agreement or condition
contained in any agreement, lease, indenture or instrument of the Company
or any Guarantor where such violation or default would have a Material
Adverse Effect.
(g) The Issuers have full corporate power and authority to enter into
this Agreement and the Indenture and to issue, sell and deliver the Notes,
in the case of the Company, and the Guarantees, in the case of the
Guarantors, to be sold by them to the Underwriter as provided herein and
therein. The execution, delivery and performance of this Agreement, the
Indenture and the Securities by the Company or any Guarantor, as the case
may be, and the consummation by the Company or any Guarantor, as the case
may be, of the transactions contemplated hereby and thereby does not and
will not conflict with or result in a breach or violation by the Company or
any Subsidiary, as the case may be, of any of the terms or provisions of,
constitute a default by the Company or any Subsidiary, as the case may be,
under, or result in the creation or imposition of any lien, charge,
security interest or encumbrance upon any of the assets of the Company or
any Subsidiary, as the case may be, pursuant to the terms of, (A) the
Credit Agreement and any other indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which the Company or
any Subsidiary, as the case may be, is a party or to which any of them or
any of their respective properties is subject, (B) the charter or bylaws of
the Company or any Subsidiary, as the case may be, or (C) any statute,
judgment, decree, order, rule or regulation of any foreign or domestic
court, governmental agency or regulatory agency or body having jurisdiction
over the Company or any of the Subsidiaries or any of their respective
properties or
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assets except for any conflict, breach, default, lien, charge, security
interest or encumbrance that would not have a Material Adverse Effect.
(h) The execution and delivery of the Indenture has been duly
authorized by all necessary corporate action of the Issuers and, when the
Fourth Supplemental Indenture has been duly executed and delivered in
accordance with its terms by each party thereto, will be a legal, valid and
binding agreement of the Issuers, enforceable against the Issuers in
accordance with its terms, subject to applicable bankruptcy, insolvency and
similar laws relating to creditors' rights generally, and subject, as to
enforceability, to general principles of equity (regardless of whether such
enforcement may be sought in a proceeding in equity or at law). The
issuance, execution and delivery of the Notes have been duly authorized by
all necessary corporate action of the Company and, when executed, issued
and delivered by the Company and authenticated by the Trustee and paid for
in accordance with this Agreement, will be the legal, valid, binding and
enforceable obligations of the Company, entitled to the benefits of the
Indenture subject to applicable bankruptcy, insolvency and similar laws
affecting creditors' rights generally, and subject, as to enforceability,
to general principles of equity (regardless of whether such enforcement may
be sought in a proceeding in equity or at law). The issuance, execution and
delivery of the Guarantees have been duly authorized by all necessary
corporate action of each Guarantor and, when executed, issued and delivered
by each Guarantor and authenticated by the Trustee and paid for in
accordance with this Agreement, will be the legal, valid, binding and
enforceable obligations of each Guarantor, entitled to the benefits of the
Indenture subject to applicable bankruptcy, insolvency and similar laws
affecting creditors' rights generally, and subject, as to enforceability,
to general principles of equity (regardless of whether such enforcement may
be sought in a proceeding in equity or at law). The execution and delivery
of this Agreement by the Issuers has been duly authorized by all necessary
corporate action, and this Agreement has been duly executed and delivered
by the Issuers and is the valid and legally binding agreement of each of
the Issuers.
(i) Except as described or referred to in the Prospectus, there is
not pending, or to the knowledge of the Issuers threatened, any action,
suit, proceeding, inquiry or investigation to which the Company or any of
the Subsidiaries is a party, or to which the property of the Company or any
of the Subsidiaries is subject, before or brought by any court or
governmental agency or body, which, if determined adversely to the Company
or any of the Subsidiaries, would individually or in the aggregate have a
Material Adverse Effect or might materially adversely affect the
consummation of the offering of the Securities pursuant to this Agreement;
and all pending legal or governmental proceedings to which the Company or
any of the Subsidiaries is a party or that affect any of their respective
properties that are not described in the Prospectus,
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including ordinary routine litigation incidental to the business, would
not, in the aggregate, result in a Material Adverse Effect.
(j) Xxxxxx Xxxxxxxx LLP are independent certified public accountants
with respect to the Company and its consolidated Subsidiaries and KPMG LLP
are independent certified public accountants with respect to certain
product lines sold to the Company by Diageo Inc. (the "Diageo Assets"), in
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each case, within the meaning of Rule 101 of the Code of Professional
Conduct of the American Institute of Certified Public Accountants ("AICPA")
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and its interpretations and rulings thereunder. The historical financial
statements of the Company and the Diageo Assets (including the related
notes) incorporated by reference in the Prospectus comply as to form in all
material respects with the requirements applicable to a registration
statement on Form S-3 under the Securities Act; such historical financial
statements have been prepared in accordance with United States generally
accepted accounting principles ("GAAP") consistently applied throughout the
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periods covered thereby and fairly present the financial position of the
Company or the Diageo Assets at the respective dates indicated and the
results of their operations and in the case of the Company, its cash flows
for the respective periods indicated. The financial information contained
in or incorporated by reference in the Prospectus and relating to the
Company is derived from the accounting records of the Company and its
Subsidiaries and fairly presents the information purported to be shown
thereby. The pro forma financial statements incorporated by reference in
the Prospectus have been prepared on a basis consistent with the historical
financial statements incorporated by reference in the Prospectus (except
for the pro forma adjustments specified therein), include all material
adjustments to the historical financial statements required by Rule 11-02
of Regulation S-X under the Securities Act and the Exchange Act to reflect
the transactions described in the Registration Statement, the Prospectus or
in the documents incorporated therein by reference, are based on
assumptions made on a reasonable basis and fairly present such transactions
described in the Registration Statement, the Prospectus or in the documents
incorporated therein by reference. The other historical financial and
statistical information and data included in the Registration Statement,
the Prospectus or in the documents incorporated therein by reference fairly
presents, in all material respects, the information purported to be shown
thereby. The financial information included in the Prospectus under the
caption "Unaudited Summary Pro Forma Combined Financial Data" is based on
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assumptions made on a reasonable basis and such pro forma financial data is
fairly presented in all material respects.
(k) Except as described in or contemplated by the Registration
Statement or the Prospectus, subsequent to February 29, 2000, (i) neither
the Company nor any of the Subsidiaries has sustained any loss or
interference with its business or properties
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from fire, flood, hurricane, accident or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental
action, order or decree which would have a Material Adverse Effect; and
(ii) there has not been any change in the capital stock (other than as a
result of exercises of options under the Company's stock option plans in
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existence on the date hereof, including issuances under the Company's 1989
Employee Stock Purchase Plan, as amended or issuances under the Company's
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U.K. Share Save Scheme, as amended, any repurchases by the Company under
its Stock Repurchase Program or as a result of the conversion of the
Company's Class B Common Stock (par value $.01 per share) into Class A
Common Stock (par value $.01 per share)) or long-term debt of the Company
or any of the Guarantors, or any other material adverse change, or any
development involving a prospective material adverse change, in or
affecting the business, condition (financial or otherwise), prospects or
operations of the Company and the Subsidiaries taken as a whole.
(l) The Company and each of the Subsidiaries have good and marketable
title to all properties and assets, as described in the Prospectus as owned
by them free and clear of all liens, encumbrances, claims, security
interests or restrictions, except as provided under the Credit Agreement as
such as are described in the Prospectus or do not interfere with the use
made and proposed to be made of such properties by the Company and the
Subsidiaries and would not individually or in the aggregate result in a
Material Adverse Effect; and all of the leases and subleases material to
the business of the Company and the Subsidiaries taken as a whole, and
under which the Company or any of the Subsidiaries holds properties
described in the Prospectus, are in full force and effect and neither the
Company nor any of the Subsidiaries has any notice of any claims of any
sort that have been asserted by anyone adverse to the rights of the Company
or any of the Subsidiaries under such leases or subleases, or affecting or
questioning the rights of the Company or any of the Subsidiaries to the
continued possession of the leased or subleased premises under any such
lease or sublease, which claims would have a Material Adverse Effect.
(m) Each of the Company and the Subsidiaries owns or possesses all
governmental and other licenses, permits, certificates, consents, orders,
approvals and other authorizations necessary to own, lease and operate its
properties and to conduct its business as presently conducted by it and
described in the Prospectus, except where the failure to own or possess
such licenses, permits, certificates, consents, orders, approvals and other
authorizations would not, individually or in the aggregate, have a Material
Adverse Effect (collectively, the "Material Licenses"); all of the Material
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Licenses are valid and in full force and effect, except where the
invalidity of such Material License or the failure of such Material License
to be in full force and effect would not, individually or in the aggregate,
have a Material Adverse Effect; and none of the
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Company or any of its Subsidiaries has received any notice of proceedings
relating to revocation or modification of any such Material Licenses which
would, individually or in the aggregate, have a Material Adverse Effect.
(n) Each of the Company and its Subsidiaries owns or possesses, or
can acquire on reasonable terms, adequate patents, patent rights, licenses,
inventions, copyrights, trademarks, service marks, trade names and know-how
(including trade secrets and other patentable and/or unpatentable
proprietary or confidential information or procedures) (collectively,
"intellectual property") necessary to carry on its business as presently
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operated by it, except where the failure to own or possess or have the
ability to acquire any such intellectual property would not, individually
or in the aggregate, have a Material Adverse Effect; and none of the
Company or any of its Subsidiaries has received any notice or is otherwise
aware of any infringement of or conflict with asserted rights of others
with respect to any intellectual property or of any facts which would
render any intellectual property invalid or inadequate to protect the
interest of the Company or any of its Subsidiaries therein and which
infringement or conflict would have a Material Adverse Effect.
(o) None of the Company or any of its Subsidiaries has taken, or will
take, directly or indirectly, any action designed to, or that might be
reasonably expected to, cause or result in stabilization or manipulation of
the price of the Securities.
(p) None of the Company or any of its Subsidiaries is an investment
company within the meaning of the Investment Company Act of 1940, as
amended.
(q) Except as described in the Prospectus, the Company and its
Subsidiaries comply in all material respects with all Environmental Laws
(as defined below), except to the extent that failure to comply with such
Environmental Laws would not individually or in the aggregate have a
Material Adverse Effect. None of the Company or any of its Subsidiaries is
the subject of any pending or, to the knowledge of any of the Issuers,
threatened foreign, federal, state or local investigation evaluating
whether any remedial action by the Company or any of its Subsidiaries is
needed to respond to a release of any Hazardous Materials (as defined
below) into the environment, resulting from the Company's or any of its
Subsidiaries' business operations or ownership or possession of any of
their properties or assets or is in contravention of any Environmental Law
that would, individually or in the aggregate, have a Material Adverse
Effect. None of the Company or any of its Subsidiaries has received any
notice or claim, nor are there pending or, to the knowledge of any of the
Issuers, threatened lawsuits against them, with respect to violations of an
Environmental Law or in connection with any release of any Hazardous
Material into the environment that would have a Material Adverse Effect. As
used herein, "Environmental Laws" means
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any foreign, federal, state or local law or regulation applicable to the
Company's or any of its Subsidiaries' business operations or ownership or
possession of any of their properties or assets relating to environmental
matters, and "Hazardous Materials" means those substances that are
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regulated by or form the basis of liability under any Environmental Laws.
(r) There are no contracts or other documents which are required to
be described in the Prospectus or filed as exhibits to the Registration
Statement by the Securities Act which have not been described in the
Prospectus or filed as exhibits to the Registration Statement or
incorporated therein by reference as permitted by the Securities Act.
(s) No relationship, direct or indirect, exists between or among the
Company and its Subsidiaries on the one hand, and the directors, officers,
stockholders, customers or suppliers of the Company on the other hand,
which is required to be described in the Prospectus which is not so
described in the Prospectus or incorporated therein by reference as
permitted by the Securities Act.
(t) No labor problem exists with the employees of the Company or any
of its Subsidiaries or, to the knowledge of the Issuers, is imminent that,
in either case, would have a Material Adverse Effect.
(u) Except as disclosed in the Prospectus, all United States federal
income tax returns and all foreign tax returns of the Company and its
Subsidiaries required by law to be filed have been filed (taking into
account extensions granted by the applicable federal governmental agency)
and all taxes shown by such returns or otherwise assessed, which are due
and payable, have been paid, except for such taxes, if any, as are being
contested in good faith and as to which adequate reserves have been
provided and except for such taxes the payment of which would not
individually or in the aggregate result in a Material Adverse Effect. All
other corporate franchise and income tax returns of the Company and its
Subsidiaries required to be filed pursuant to applicable foreign, federal,
state or local laws have been filed, except insofar as the failure to file
such returns would not individually or in the aggregate result in a
Material Adverse Effect, and all taxes shown on such returns or otherwise
assessed which are due and payable have been paid, except for such taxes,
if any, as are being contested in good faith and as to which adequate
reserves have been provided and except for such taxes the payment of which
would not individually or in the aggregate result in a Material Adverse
Effect.
(v) The Company and each of its Subsidiaries maintain (and in the
future will maintain) a system of internal accounting controls sufficient
to provide reasonable
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assurances that (A) transactions are executed in accordance with
management's general or specific authorization; (B) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with GAAP and to maintain accountability for assets; (C) access
to assets is permitted only in accordance with management's general or
specific authorization; and (D) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(w) The Company and each of its Subsidiaries is in compliance with,
and each such entity has not received any notice of any outstanding
violation of, all laws, regulations, ordinances and rules applicable to it
and its operations, except, in either case, where any failure by the
Company or any of its Subsidiaries to comply with any such law, regulation,
ordinance or rule would not individually or in the aggregate result in a
Material Adverse Effect.
(x) Neither the issuance, sale or delivery of the Securities and the
Guarantees nor the application of the proceeds thereof by the Company as
set forth in the Prospectus will violate Regulations T, U or X of the Board
of Governors of the Federal Reserve System or any other regulation of such
Board of Governors.
(y) Each of the Company and its Subsidiaries is, and immediately
after the Closing Date will be, Solvent. As used herein, the term "Solvent"
-------
means, with respect to any such entity on a particular date, that on such
date (A) the fair market value of the assets of such entity is greater than
the amount that will be required to pay the probable liabilities of such
entity on its debts as they become absolute and matured, (B) assuming the
sale of the Securities as contemplated by this Agreement and as described
in the Prospectus, such entity is not incurring debts or liabilities beyond
its ability to pay as such debts and liabilities mature, (C) such entity is
able to realize upon its assets and pay its debts and other liabilities,
including contingent obligations, as they mature and (D) such entity does
not have unreasonably small capital.
(z) Other than this Agreement, neither the Company nor any Subsidiary
is a party to any contract, agreement or understanding with any person that
would give rise to a valid claim against the Issuers or any Subsidiary or
the Underwriter for a brokerage commission, finders' fee or like payment in
connection with the offering and sale of the Securities.
(aa) The conditions for use of Form S-3, as set forth in the General
Instructions thereto, have been satisfied by the Company.
-13-
(bb) No forward-looking statement (within the meaning of Section 27A
of the Securities Act and Section 21E of the Exchange Act) contained in the
Preliminary Prospectus or the Prospectus has been made or reaffirmed
without a reasonable basis or has been disclosed other than in good faith.
Any certificate signed by an officer of any of the Issuers and
delivered to the Underwriter or to counsel for the Underwriter at or prior to
the Closing Date pursuant to any section of this Agreement or the transactions
contemplated hereby shall be deemed a representation and warranty by such
Issuer, to the Underwriter as to the matters covered thereby.
5. Each of the Issuers covenants and agrees with the Underwriter as
follows:
(a) in respect of the offering of the Securities, the Issuers will
(i) prepare a Prospectus Supplement setting forth the aggregate principal
amount of each type of Securities covered thereby and their terms not
otherwise specified in the Basic Prospectus pursuant to which the
Securities are being issued, the name of the Underwriter participating in
the offering, the price at which the Securities are to be purchased by the
Underwriter from the Issuers, the initial public offering price, the
applicable selling concession and reallowance, if any, and such other
information as the Underwriter and the Issuers deem appropriate in
connection with the offering of the Securities, (ii) file the Prospectus in
a form approved by the Underwriter pursuant to Rule 424 under the
Securities Act no later than the Commission's close of business on the
second Business Day following the date of determination of the offering
price of the Securities and (iii) furnish copies of the Prospectus to the
Underwriter and to such dealers as the Underwriter shall specify in New
York City as soon as practicable (but in any event in sufficient time as to
allow the Underwriter and such dealers to deliver such Prospectus prior to
or simultaneously with confirmations of sale) after the date of this
Agreement in such quantities as the Underwriter may reasonably request;
(b) to deliver, at the expense of the Issuers, to the Underwriter a
total of three signed copies of the Registration Statement (as originally
filed) and each amendment thereto, in each case including exhibits, and,
during the period mentioned in paragraph (f) below, to the Underwriter and
to dealers effecting transactions in the Securities as many copies of the
Prospectus (including all amendments and supplements thereto) as the
Underwriter may reasonably request;
(c) to furnish to the Underwriter without charge, as many copies of
the exhibits and documents incorporated by reference in the Registration
Statement as the Underwriter may reasonably request;
-14-
(d) (i) at any time when the Prospectus is required to be delivered
under the Securities Act or the Exchange Act in connection with sales of
Securities, not to file any amendment to the Registration Statement or any
Rule 462(B) Registration Statement or to make any amendment or supplement
to the Prospectus of which the Underwriter shall not previously have been
advised or to which the Underwriter or counsel for the Underwriter shall
reasonably object; and to prepare and file with the Commission, promptly
upon the Underwriter's reasonable request, any amendment to the
Registration Statement, Rule 462(B) Registration Statement, or amendment or
supplement to the Prospectus that, in the opinion of counsel for the
Underwriter, may be necessary in connection with the distribution of the
Securities by the Underwriter, and to use its best efforts to cause the
same to become promptly effective and (ii) if applicable, the Prospectus
and any amendments or supplements thereto furnished to the Underwriter will
be identical in content to the electronically transmitted copies thereof
filed with the Commission pursuant to XXXXX, except to the extent permitted
by Regulation S-T;
(e) to advise the Underwriter promptly, and to confirm such advice in
writing, (i) when any amendment to the Registration Statement shall have
become effective, (ii) when any supplement to the Prospectus or any
amendment to the Prospectus has been filed and to furnish the Underwriter
with copies thereof, (iii) of any request by the Commission for any
amendment to the Registration Statement or any amendment or supplement to
the Prospectus or for any additional information, (iv) of the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or of any order preventing or suspending the use of
any Preliminary Prospectus or the Prospectus or the initiation or
threatening of any proceeding for that purpose, (v) of the occurrence of
any event, within the period referenced in paragraph (f) below, as a result
of which the Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in light of the
circumstances in which such statements are made, not misleading, and (vi)
of the receipt by any of the Issuers of any notification with respect to
any suspension of the qualification of the Securities for offer and sale in
any jurisdiction or the initiation or threatening of any proceeding for
such purpose; and to use its commercially reasonable best efforts to
prevent the issuance of any such stop order, or of any order preventing or
suspending the use of any Preliminary Prospectus or the Prospectus, or of
any order suspending any such qualification of the Securities, or
notification of any such order thereof and, if issued, to use its
commercially reasonable best efforts to obtain as soon as possible the
withdrawal thereof;
-15-
(f) if, during such period of time after the first date of the public
offering of the Securities as in the reasonable opinion of counsel for the
Underwriter a prospectus relating to the Securities is required by law to
be delivered in connection with sales by the Underwriter or any dealer, any
event shall occur as a result of which it is necessary to amend or
supplement the Prospectus in order to make the statements therein, in the
light of the circumstances in which such statements are made, not
misleading, or if it is necessary to amend or supplement the Prospectus to
comply with applicable federal and state securities law, to reasonably
promptly prepare and furnish, to the Underwriter and to the dealers (whose
names and addresses the Underwriter will furnish to the Company) to which
Securities may have been sold by the Underwriter and to any other dealers
upon request, such amendments or supplements to the Prospectus as may be
necessary so that the statements in the Prospectus as so amended or
supplemented will comply with applicable federal and state securities law;
provided, however, that any amendments or supplements made more than one
-------- -------
year after the first date of the public offering of the Securities shall be
made at the expense of the Underwriter;
(g) to use its commercially reasonable best efforts to qualify the
Securities for offer and sale under the securities or Blue Sky and real
estate syndication laws of such jurisdictions as the Underwriter shall
reasonably request and to continue such qualification in effect so long as
reasonably required for distribution of the Securities and to pay all fees
and expenses (including fees and disbursements of counsel to the
Underwriter) incurred in connection with such qualification; provided that
the Issuers shall not be required to file a general consent to service of
process in any jurisdiction or to qualify as a foreign corporation in any
jurisdiction, and provided, further, that all fees and expenses incurred in
--------
connection with qualifying the Securities for offer and sale after the
first anniversary of the public offering of such Securities shall be paid
by the Underwriter;
(h) to make generally available to its security holders and to the
Underwriter, as soon as practicable, an earnings statement covering a
period of at least twelve months beginning with the first fiscal quarter of
the Company and the Subsidiaries occurring after the effective date of the
Registration Statement, which shall satisfy the provisions of Section 11(a)
of the Securities Act and Rule 158 of the Commission promulgated
thereunder;
(i) for such period as the Securities remain outstanding, to furnish
to the Underwriter copies of all reports or other communications (financial
or other) furnished to holders of the Securities and copies of any reports
and financial statements furnished to or filed with the Commission, the
National Association of Securities Dealers, Inc. (the "NASD") or any
----
national securities exchange;
-16-
(j) during the period when the Prospectus is required to be delivered
under the Securities Act or the Exchange Act in connection with sales of
the Securities, to file all documents required to be filed by it with the
Commission pursuant to Section 13, 14 or 15 of the Exchange Act within the
time periods required by the Exchange Act;
(k) whether or not the transactions contemplated in this Agreement
are consummated or this Agreement is terminated, to pay or cause to be paid
all costs and expenses incident to the performance of the obligations of
the Issuers hereunder, including without limiting the generality of the
foregoing, all costs and expenses (i) incident to the preparation,
issuance, execution and delivery of the Securities (including the payment
of any stamp tax or duty in connection therewith), (ii) incident to the
preparation, printing and filing under the Securities Act of the
Registration Statement, the Prospectus and any Preliminary Prospectus
(including in each case all exhibits, amendments and supplements thereto),
(iii) incurred in connection with the registration or qualification of the
Securities under the applicable securities laws of such jurisdictions as
the Underwriter may reasonably designate (including fees of counsel for the
Underwriter and its reasonable disbursements in connection therewith), (iv)
in connection with the listing or proposed listing of securities on any
securities exchange, (v) related to any required filing with, and review
by, the NASD, (vi) in connection with the printing (including word
processing and duplication costs) and delivery of this Agreement and the
furnishing to the Underwriter and dealers of copies of the Registration
Statement and the Prospectus, including mailing and shipping, as herein
provided, (vii) any expenses incurred by the Company in connection with a
"road show" presentation to potential investors, (viii) incident to the
preparation, printing and filing of the Listing Particulars (including all
exhibits, amendments and supplements thereto) and (ix) the cost and charges
of any transfer agent, registrar, listing agent, paying agent or custodian;
(l) the Issuers will use the net proceeds received by them from the
sale of the Securities pursuant to this Agreement in the manner specified
in the Prospectus Supplement under the caption "Use of Proceeds";
---------------
(m) the Issuers will use their best efforts to do and perform all
things required to be done and performed under this Agreement by the
Issuers prior to the Closing Date and to satisfy all conditions precedent
to the delivery of the Securities;
(n) to take all reasonable action necessary to enable Xxxxx'x
Investors Service, Inc. ("Moody's") and Standard & Poor's Ratings Group
-------
("S&P") or their respective successors or assigns, to provide their
---
respective credit ratings of the Securities, as specified in Schedule I
hereto;
-17-
(o) for a period of 90 days from the date of the Prospectus, not to
offer for sale, sell, contract to sell or otherwise dispose of, directly or
indirectly, or file a registration statement for, or announce any offer,
sale, contract for sale of or other disposition of any unsecured debt
securities denominated in sterling, issued or guaranteed by the Company or
any of its Subsidiaries (other than the Securities) without the prior
written consent of Barclays, which consent shall not be unreasonably
withheld; provided that in the case of both this paragraph (o) and
paragraph (p) below, the Company shall be permitted (i) to file a shelf
registration statement on Form S-3 for the subsequent offer and sale of any
combination of securities in one or more offerings, (provided that the
Company shall not during such 30 and 90 day periods offer any such
securities by one or more supplemental prospectuses or otherwise), and (ii)
the Company shall be permitted to file a registration statement on Form S-4
for the issuance of Securities to be issued in exchange for the Company's 8
1/2% Series B Senior Notes due 2009.
(p) for a period of 30 days from the date of the Prospectus, not to
offer for sale, sell, contract to sell or otherwise dispose of, directly or
indirectly, or file a registration statement for, or announce any offer,
sale, contract for sale of or other disposition of any unsecured debt
securities issued or guaranteed by the Company or any of its Subsidiaries
(other than the Securities) without the prior written consent of Barclays,
which consent shall not be unreasonably withheld; and
(q) to use its best efforts to (i) list the Securities on the
Luxembourg Stock Exchange promptly after closing and to maintain such
listing (or listing on an alternate exchange with the written consent of
the Underwriter) for as long as the Securities are outstanding and (ii)
permit the Securities to be eligible for clearance and settlement through
the Euroclear System and Clearstream for so long as the Securities are
outstanding.
6. The obligation of the Underwriter hereunder to purchase the
Securities on the Closing Date is subject to the performance by each of the
Issuers of its respective obligations hereunder and to the following additional
conditions:
(a) (i)(A) the Registration Statement (excluding the Rule 462
Registration Statement) shall remain effective (or if a post-effective
amendment is required to be filed under the Securities Act, such post-
effective amendment shall have become effective not later than 5:00 P.M.,
New York City time, on the date hereof), (B) if the Company has elected to
rely on Rule 462(B), the Rule 462 Registration Statement shall have become
effective not later than 10:00 P.M., New York City time, on the date
hereof, and (C) no stop order suspending the effectiveness of the
Registration Statement or any post-effective amendment shall be in effect,
and no proceedings for
-18-
such purpose shall be pending before or threatened by the Commission; (ii)
the Prospectus shall have been filed with the Commission pursuant to Rule
424 within the applicable time period prescribed for such filing by the
rules and regulations under the Securities Act and in accordance with
Section 5(a) hereof; and (iii) all requests for additional information by
the Commission shall have been complied with to the reasonable satisfaction
of the Underwriter;
(b) the representations and warranties of each of the Issuers
contained herein shall be true and correct on and as of the Closing Date as
if made on and as of the Closing Date and each of the Issuers shall have
complied with all agreements and all conditions on its respective part to
be performed or satisfied hereunder at or prior to the Closing Date;
(c) subsequent to the execution and delivery of this Agreement and
prior to the Closing Date, there shall not have occurred any downgrading,
nor shall any notice have been given of (i) any intended or potential
downgrading or (ii) any review or possible change that indicates a
potential downgrading, in the rating accorded any securities of or
guaranteed by any of the Issuers by any "nationally recognized statistical
rating organization", as such term is defined for purposes of Rule 436
under the Securities Act;
(d) (i) since the respective dates as of which information is given
in the Prospectus and as of the Closing Date, there shall not have been any
change in the capital shares or long-term debt of the Company or any of the
Subsidiaries and there shall not have occurred any event that would have a
Material Adverse Effect or any development involving a prospective Material
Adverse Effect, otherwise than as set forth or contemplated in the
Registration Statement and the Prospectus, the effect of which in the
judgment of the Underwriter makes it impracticable or inadvisable to
proceed with the public offering or the delivery of the Securities on the
Closing Date, on the terms and in the manner contemplated in the Prospectus
and (ii) neither the Company nor any of the Subsidiaries shall have
sustained since the date of the latest audited financial statements
included in or incorporated by reference in the Prospectus any material
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 Prospectus;
(e) the Underwriter shall have received on and as of the Closing
Date, a certificate of an executive officer of the Company with specific
knowledge about the Company's financial matters reasonably satisfactory to
the Underwriter to the effect set
-19-
forth in subsections (b) through (d) (with respect to the respective
representations, warranties, agreements and conditions of the Company) of
this Section 6;
(f) XxXxxxxxx, Will & Xxxxx, special counsel for the Company, shall
have furnished to the Underwriter its written opinion addressed to the
Underwriter, dated the Closing Date, in form and substance reasonably
satisfactory to the Underwriter, substantially in the form of Annex I
hereto;
(g) Xxxxx Peabody LLP, counsel for the Issuers, shall have furnished
to the Underwriter its written opinion addressed to the Underwriter, dated
the Closing Date, in form and substance reasonably satisfactory to the
Underwriter, substantially in the form of Annex II hereto;
(h) each of Xxxxx Xxxxxxx Xxxxxxx & Xxxxx LLP and Xxxxxxxx Chance,
local counsel for the Issuers, shall each have furnished to the Underwriter
its written opinion addressed to the Underwriter, dated the Closing Date,
in form and substance reasonably satisfactory to the Underwriter,
substantially in the form of Annex III hereto;
(i) on the date hereof, and also on the Closing Date, Xxxxxx Xxxxxxxx
LLP and KPMG LLP shall each have furnished to the Underwriter letters,
dated the respective dates of delivery thereof, in form and substance
satisfactory to the Underwriter, containing statements and information of
the type customarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and certain financial
information contained or incorporated by reference in the Registration
Statement and the Prospectus, including statements with respect to a review
in accordance with SAS 71 of any interim financial information contained or
incorporated by reference in the Registration Statement and the Prospectus;
(j) the Underwriter shall have received on and as of the Closing Date
an opinion addressed to the Underwriter of Xxxxxx Xxxxxx & Xxxxxxx, counsel
to the Underwriter, with respect to the due authorization and valid
issuance of the Securities, the Registration Statement, the Prospectus and
such other related matters as the Underwriter 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;
(k) on or prior to the Closing Date, the Issuers shall have furnished
to the Underwriter such further certificates and documents as the
Underwriter shall reasonably request;
-20-
(l) at the Closing Date, the Securities shall have the ratings
accorded by any "nationally recognized statistical organization," as
defined by the Commission for purposes of Rule 436(G)(2) under the Act as
specified in Schedule I hereto, and the Company shall have delivered to the
Underwriter a letter, dated as of such date, from each such rating
organization, or other evidence reasonably satisfactory to the Underwriter,
confirming that the Securities have such ratings. Since the date hereof,
there shall not have occurred a downgrading in the rating assigned to the
Securities or any of the Issuers' securities or any Subsidiary's other
securities by any such rating organization, and no such rating organization
shall have publicly announced that it has under surveillance or review,
with possible negative implications, its rating of the Securities or any of
the Company's or any Subsidiary's other securities; and
(m) the Securities have been approved for listing on the Luxembourg
Stock Exchange.
If any of the foregoing conditions is not satisfied on or before the
Closing Date, this Agreement shall (subject to the terms hereof) terminate on
such date and the parties hereto shall be under no further obligations arising
out of this Agreement (except as otherwise specifically provided and except for
any liability arising before or in relation to such termination), provided that
the Underwriter may, in its sole discretion, waive any of the conditions
contained in this Section 6 or any part of them.
7. The Issuers, jointly and severally, agree to indemnify and hold
harmless the Underwriter, its officers and directors, Barclays Capital Inc. (the
Underwriter's United States broker-dealer affiliate), and each person, if any,
who controls the Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and against any and all
losses, claims, damages or liabilities (including, without limitation, the legal
fees and other expenses incurred in connection with any suit, action or
proceeding or any claim asserted) to which such Underwriter may become subject,
under the Securities Act or otherwise, insofar as such losses, claims damages or
liabilities (or actions in respect thereof) arise out of or are based upon 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
Issuers shall have furnished any amendments or supplements thereto) or any
Preliminary Prospectus, or arise out of or are based upon any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, except insofar as such losses, claims,
damages or liabilities are caused by any untrue statement or omission or alleged
untrue statement or omission made in reliance upon and in conformity with any
Underwriter's Information; provided, however, that the Issuers shall not be
-------- -------
liable to the Underwriter under this paragraph of Section 7 to the extent that
any such loss, claim, damage or liability results solely from an untrue
statement of a material fact contained
-21-
in, or the omission of a material fact from, a Preliminary Prospectus if (i)
such untrue statement or omission was completely corrected in the Prospectus
prior to the written confirmation of the sale of the Securities giving rise to
such liability, (ii) such Underwriter sold Securities to the person alleging
such loss, claim, damage or liability without (to the extent required by
applicable law) sending or giving the Prospectus at or prior to the written
confirmation of the sale of the Securities giving rise to such liability, (iii)
the Issuers had furnished copies of the Prospectus to such Underwriter prior to
the written confirmation of the sale of the Securities giving rise to such
liability and (iv) such Underwriter would not have been subject to such
liability if it had delivered the Prospectus to such person at or prior to the
written confirmation of such sale.
The Underwriter agrees to indemnify and hold harmless each of the
Issuers, its directors, its officers who sign the Registration Statement and
each person, if any who controls such Issuer within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act from and to
the same extent as the foregoing indemnity from the Issuers to the Underwriter,
but only to the extent that such untrue statement or alleged untrue statement or
omission or alleged omission was made in reliance upon and in conformity with
any Underwriter's Information.
If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against
any person in respect of which indemnity may be sought pursuant to either of the
two preceding paragraphs, such person (the "Indemnified Person") shall promptly
------------------
notify the person or persons against whom such indemnity may be sought (each an
"Indemnifying Person") in writing, and such Indemnifying Person, upon request of
-------------------
the Indemnified Person, shall retain counsel reasonably satisfactory to the
Indemnified Person to represent the Indemnified Person and any others entitled
to indemnification pursuant to this Section 7 that the Indemnifying Person may
designate in such proceeding and shall pay the fees and expenses of such counsel
related to such proceeding. In any such proceeding, any Indemnified Person
shall have the right to retain its own counsel, but the fees and expenses of
such counsel shall be at the expense of such Indemnified Person unless (i) such
Indemnifying Person and the Indemnified Person shall have mutually agreed to the
contrary, (ii) such Indemnifying Person has failed within a reasonable time to
retain counsel reasonably satisfactory to such Indemnified Person or (iii) the
named parties in any such proceeding (including any impleaded parties) include
an Indemnifying Person and an Indemnified Person and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that an Indemnifying Person
shall not, in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the fees and expenses of more than one separate firm
(in addition to any local counsel) for all Indemnified Persons, and that all
such fees and expenses shall be reimbursed as they are incurred. Any such
separate firm for the Underwriter and such
-22-
control persons of Underwriter shall be designated in writing by the
Underwriter, and any such separate firm for the Issuers, their respective
directors, their respective officers who sign the Registration Statement and
such control persons of any of the Issuers shall be designated in writing by the
Company. The Indemnifying Person shall not be liable for any settlement of any
proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, such Indemnifying
Person agrees to indemnify each Indemnified Person from and against any loss or
liability by reason of such settlement or judgment. No Indemnifying Person
shall, without the prior written consent of the Indemnified Person, effect any
settlement of any pending or threatened proceeding in respect of which any
Indemnified Person is or could have been a party and indemnity could have been
sought hereunder by such Indemnified Person, unless such settlement includes an
unconditional release of such Indemnified Person from all liability on claims
that are the subject matter of such proceeding.
If the indemnification provided for in the first and second paragraphs
of this Section 7 is unavailable to an Indemnified Person or insufficient in
respect of any losses, claims, damages or liabilities referred to therein, then
each Indemnifying Person under such paragraph, in lieu of indemnifying such
Indemnified Person thereunder, shall contribute to the amount paid or payable by
such Indemnified Person as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Issuers on the one hand and the Underwriter on the
other hand from the offering of the Securities 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 Issuers on the one
hand and the Underwriter on the other in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. The relative benefits received
by the Issuers on the one hand and the Underwriter on the other shall be deemed
to be in the same respective proportions as the net proceeds from the offering
and sale of the Securities (before deducting expenses) received by the Issuers
and the total underwriting commissions received by the Underwriter, in each case
as set forth in the table on the cover of the Prospectus. The relative fault of
the Issuers on the one hand and the Underwriter on the other 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 Issuers, on the one hand,
or by the Underwriter on the other hand and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
Each of the Issuers and the Underwriter agrees that it would not be
just and equitable if contribution pursuant to this Section 7 were determined by
pro rata allocation or by any other method of allocation that does not take
--------
account of the equitable considerations re-
-23-
ferred to in the immediately preceding paragraph. The amount paid or payable by
an Indemnified Person as a result of the losses, claims, damages and liabilities
referred to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses incurred
by such Indemnified Person in connection with investigating or defending any
such action or claim. Notwithstanding the provisions of this Section 7, in no
event shall an Underwriter be required to contribute any amount in excess of the
amount by which the total price at which the Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages that such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
The remedies provided for in this Section 7 are not exclusive and
shall not limit any rights or remedies that may otherwise be available to any
indemnified party at law or in equity.
The indemnity and contribution agreements contained in this Section 7
and the representations and warranties of the Company set forth in this
Agreement shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, (ii) any investigation made by or on behalf
of the Underwriter or any person controlling the Underwriter or by or on behalf
of the Issuers, their respective officers or directors or any other person
controlling any of the Issuers and (iii) acceptance of and payment for any of
the Securities.
8. Notwithstanding anything herein contained, this Agreement may be
terminated in the absolute discretion of the Underwriter, by notice given to the
Company, if after the execution and delivery of this Agreement and prior to the
Closing Date (i) trading generally shall have been suspended or materially
limited on or by, as the case may be, the New York Stock Exchange, the American
Stock Exchange, the NASDAQ National Market, the Chicago Mercantile Exchange, the
Chicago Board of Options Exchange, the Chicago Board of Trade, the London Stock
Exchange or the Luxembourg Stock Exchange, (ii) trading of any securities of or
guaranteed by any of the Issuers shall have been suspended on any exchange or in
any over-the-counter market, (iii) a general moratorium on commercial banking
activities in New York shall have been declared by either federal or New York
State authorities, (iv) a general moratorium on commercial banking activities in
London shall have been declared by United Kingdom or other governmental
authorities, or (v) there shall have occurred any outbreak or escalation of
hostilities or any change in financial markets or any calamity or crisis that,
in the judgment of the Underwriter, is material and adverse and that, in the
judgment of the Underwriter, makes it impracticable to market the Securities on
the terms and in the manner contemplated in the Prospectus.
-24-
9. This Agreement shall become effective upon the execution and
delivery hereof by the parties hereto.
10. If this Agreement shall be terminated by the Underwriter because
of any failure or refusal on the part of any of the Issuers to comply with the
terms or to fulfill any of the conditions of this Agreement, or if for any
reason any of the Issuers shall be unable to perform its respective obligations
under this Agreement or any condition of the Underwriter's obligations cannot be
fulfilled, the Issuers agree, jointly and severally, to promptly reimburse the
Underwriter for all reasonable out-of-pocket expenses (including the fees and
expenses of their counsel) incurred by the Underwriter in connection with this
Agreement or the offering contemplated hereunder.
All notices and other communications hereunder shall be in writing and
shall be deemed to have been duly given if mailed or transmitted by any standard
form of telecommunication. Notices to the Underwriter shall be given, x/x
Xxxxxxxx Xxxx XXX, 0 Xxx Xxxxx Xxxxxxxxx, Xxxxxx Xxxxx, Xxxxxx X00 0XX
(Facsimile: +44 (0) 207) 773-4934), Attention Head of Legal Department, with a
copy to Xxxxxx Xxxxxx & Xxxxxxx, 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000
(Facsimile: (000) 000-0000), Attention Xxxxxx X. Xxxxxxx, Esq. Notices to the
Company shall be given c/o the Company at 000 XxxxxxXxxxx Xxxxxx Xxxx, Xxxxxxxx,
Xxx Xxxx, 00000 (Facsimile: (000) 000-0000), Attention Xxxxx Xxxxx, Corporate
Counsel, with a copy to XxXxxxxxx, Will & Xxxxx, 000 Xxxx Xxxxxx Xxxxxx,
Xxxxxxx, Xxxxxxxx, 00000-0000 (Facsimile: (000) 000-0000), Attention Xxxxxxx
Xxxxxx, Esq.
11. This Agreement shall inure to the benefit of and be binding upon
the Underwriter, the Company, the Guarantors and any controlling person referred
to herein and their respective successors, heirs and legal representatives.
Nothing expressed or mentioned in this Agreement is intended or shall be
construed to give any other person, firm or corporation any legal or equitable
right, remedy or claim under or in respect of this Agreement or any provision
herein contained. No purchaser of Securities from the Underwriter shall be
deemed to be a successor by reason merely of such purchase.
12. This Agreement may be signed in counterparts, each of which shall
be an original and all of which together shall constitute one and the same
instrument.
13. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York, without giving effect to the conflicts
of laws provisions thereof.
-25-
If the foregoing is in accordance with your understanding, please sign
and return fourteen counterparts hereof.
Very truly yours,
CANANDAIGUA BRANDS, INC.
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Executive Vice
President and Chief Financial Officer
BATAVIA WINE CELLARS, INC.
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Treasurer
CANANDAIGUA WINE COMPANY, INC.
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Treasurer
CANANDAIGUA EUROPE LIMITED
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Treasurer
CANANDAIGUA LIMITED
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Finance Director
POLYPHENOLICS, INC.
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Vice President and Treasurer
XXXXXXX TRADING CORP.
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, President and Treasurer
CANANDAIGUA B.V.
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Authorized Representative
FRANCISCAN VINEYARDS, INC.
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Vice President and Treasurer
XXXXXXXX, INC.
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Vice President and Treasurer
CLOUD PEAK CORPORATION
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Vice President and Treasurer
X.X. XXXXX CORP.
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Vice President and Treasurer
MT. XXXXXX CORPORATION
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Vice President and Treasurer
XXXXXX INCORPORATED
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Vice President
XXXXXX BRANDS, LTD.
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Vice President
XXXXXX XXXXX, LTD.
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Vice President
XXXXXX BRANDS OF CALIFORNIA, INC.
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Vice President
XXXXXX BRANDS OF GEORGIA, INC.
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Vice President
XXXXXX CANADA, LTD.
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Vice President
XXXXXX DISTILLERS IMPORT CORP.
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Vice President
XXXXXX FINANCIAL CORPORATION
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Vice President
XXXXXXX POINT BEVERAGE CO.
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Vice President
MONARCH IMPORT COMPANY
By:
/s/ Xxxxxx X. Summer
------------------------------------
Xxxxxx X. Summer, Vice President
Accepted:
BARCLAYS BANK PLC
By: /s/ Xxxxx Xxxxxx
Name: Xxxxx Xxxxxx
Title: Director
SCHEDULE I
Underwriter: Barclays Bank PLC
Underwriting Agreement Dated: May 5, 2000
Registration Statement No.: 333-91587
Title of Securities: 8 1/2% Series C Senior Notes due 2009
(the "Notes")
Aggregate Principal Amount: (Pounds)80,000,000
Price to Public: 99.5% per Note
Purchase Price: 98.5% per Note
Underwriting Discount: 1.0% per Note
Indenture: Indenture dated as of February 25,
1999, as supplemented by Supplemental
Indenture No. 3, dated, August 6, 1999,
as further supplemented by Supplemental
Indenture No. 4, to be dated as of May
15, 2000, each between the Company, the
Guarantors and the Trustee.
Maturity: November 15, 2009
Interest Rate: 8 1/2%
Interest Payment Dates: Interest on the Notes will accrue from
the Closing Date and be payable semi-
annually on May 15 and November 15 of
each year, commencing November 15,
2000.
Optional Redemption Provisions: The Notes are redeemable at any time at
the option of the Company in whole or
in part, at a redemption price equal to
the sum of (i) 100% of the principal
amount of the Securities being redeemed
and (ii) the sum of the present values
of the remaining scheduled payments of
principal
-2-
and interest on such Securities,
discounted to the date of redemption,
on a semi-annual basis, at the Adjusted
Gilt Rate (as defined in the
Prospectus) plus 50 basis points, plus,
in each case, accrued interest thereon
to the date of redemption.
Mandatory Redemption Provisions: None.
Sinking Fund Provisions: None.
Defeasance Provisions: Standard defeasance and covenant
defeasance provisions.
Ratings: Standard & Poor's: XX
Xxxxx'x Investors Service: Ba2
Lockup Provisions: None.
Other Provisions: None.
Closing Date: May 15, 2000
Closing Location: Xxxxxx Xxxxxx & Xxxxxxx
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
ANNEX I
Form of Opinion of XxXxxxxxx, Will & Xxxxx
(i) The Company has been duly incorporated, is validly existing and
in good standing under the laws of the State of Delaware. The Company has the
corporate power and authority to execute, deliver and perform all of its
respective obligations under the Notes, the Indenture and the Underwriting
Agreement (the "Transaction Documents").
(ii) No consent, approval, authorization, order, registration or
qualification of or with any governmental authority or agency or, to our
knowledge, any court or similar body is required under the laws of the United
States, the State of New York and the General Corporation Law of the State of
Delaware for the execution, delivery or performance of the Transaction Documents
by the Company or any Guarantor, as the case may be, except such as may be
required under state securities or blue sky laws in connection with the purchase
and distribution of the securities by the Underwriter (as to which no opinion is
required).
(iii) The execution, delivery and performance of the Transaction
Documents by the Company and the application of the net proceeds from the sale
of the Securities in the manner described in the Prospectus under the caption
"Use of Proceeds" do not and will not (A) conflict with the charter and by-laws
of the Company, (B) conflict with, constitute a breach of or a default by the
Company or any Guarantor, as the case may be, under, or result in the creation
or imposition of any lien, security interest or encumbrance upon any of the
assets of the Company or any Guarantor, as the case may be, pursuant to the
terms of the Credit Agreement or any other indenture, mortgage, deed of trust,
loan or credit agreement, bond, debenture, note, lease or other agreement or
instrument listed on Exhibit I hereto, (C) contravene the General Corporation
Law of the State of Delaware or any statute, rule or regulation under the laws
of the United States and the State of New York applicable to the Company or any
of its properties or (D) to the knowledge of such counsel, conflict with or
violate any judgment, decree or order of any court or governmental agency or
court or body applicable to the Company or any of its properties.
(iv) The Transaction Documents have been duly authorized by the
Company. The Transaction Documents and the Guarantees have been duly executed
and delivered by the Company and each of the Guarantors, as applicable. The sale
and the issuance of the Notes, and the execution and delivery thereof, have been
duly authorized by requisite corporate action of the Company. The Securities
have been duly delivered to the Underwriter by the Company and the Guarantors.
-2-
(v) The Indenture is a valid and binding agreement, enforceable
against the Company and each Guarantor in accordance with its terms, except to
the extent that enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally and general principles of equity
(regardless of whether enforceability is considered in a proceeding at law or in
equity). When the Notes and the Guarantees have been authenticated in accordance
with the terms of the Indenture, the Notes and the Guarantees will be valid and
binding obligations of the Company and the Guarantors, respectively, entitled to
the benefits of the Indenture and enforceable against the Company and the
Guarantors in accordance with their terms, except to the extent that enforcement
thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws now or hereafter in effect relating to creditors' rights
generally and general principles of equity (regardless of whether enforceability
is considered in a proceeding at law or in equity).
(vi) The Securities and the Indenture conform in all material respects
to the descriptions thereof under the caption "Description of the Notes" in the
Prospectus and "Description of Debt Securities" in the Basic Prospectus. The
statements made in the Prospectus under the captions "Description of the Senior
Credit Facilities" and "Certain United States Federal Income Tax
Considerations," insofar as they describe certain provisions of the Credit
Agreement or matters of law, are accurate in all material respects.
(vii) The Registration Statement was declared effective under the
Securities Act as of December 3, 1999, the Prospectus was filed with the
Commission pursuant to the subparagraph of Rule 424(b) of the Rules and
Regulations specified in such opinion on the dates specified therein and no stop
order suspending the effectiveness of the Registration Statement has been issued
and, to the knowledge of such counsel, no proceeding for that purpose is pending
or threatened by the Commission.
(viii) As of its date and as of the Closing Date, the Registration
Statement and the Prospectus and any further amendments or supplements thereto
made by the Company prior to the Closing Date (except for the financial
statements, the notes thereto and related schedules and other financial data
included therein, as to which such counsel need express no opinion) comply as to
form in all material respects with the requirements of the Securities Act and
the Rules and Regulations (except that such counsel will not express any opinion
as to the financial statements, schedules and other financial data included
therein or incorporated by reference therein or excluded therefrom, or exhibits
thereto or assume any responsibility for the accuracy, completeness or fairness
of the statements contained in the prospectus except to the extent set forth in
paragraph (vi) of this opinion).
(ix) The Indenture conforms as to form in all material respects with
the requirements of the Trust Indenture Act and the Trust Indenture Act Rules
and Regulations.
-3-
(x) Neither the Company nor any Subsidiary is required to register
under the Investment Company Act of 1940, as amended (the "1940 Act"), as an
--------
"investment company" as such term is defined in the 1940 Act.
(xi) Neither the issuance, sale or delivery of the Securities nor the
application of the proceeds thereof by the Company as set forth in the
Prospectus will violate Regulations T, U or X of the Board of Governors of the
Federal Reserve System or any other regulation of such Board of Governors.
Such opinion shall also contain a statement that such counsel has
participated in conferences with officers and representatives of the Company and
the Subsidiaries, and representatives of the independent accountants of the
Company and the Underwriter at which the contents of the Registration Statement
and the Prospectus and related matters were discussed and that although such
counsel need not pass upon or assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement or the Prospectus, and need not make any independent check or
verification thereof, except as set forth in paragraph (vi) of this form of
opinion, based upon the foregoing, no facts came to such counsel's attention to
lead such counsel to believe that the Registration Statement or the Prospectus
(including the documents incorporated therein by reference (except to the extent
statements contained in such documents have been modified or superseded by
statements contained in the Prospectus)), as of its date and as of the Closing
Date, contained an untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading. Such counsel need not express an opinion or belief as
to the financial statements, the notes thereto, schedules and other financial
data included therein, or incorporated by reference into, or excluded from the
Registration Statement or the Prospectus.
In rendering such opinions, such counsel may rely as to matters of
fact, to the extent such counsel deems proper, on certificates or statements of
responsible officers of the Company and certificates or other written statements
of officials of jurisdictions having custody of documents respecting corporate
existence or good standing.
EXHIBIT I TO ANNEX I
1. Importer Agreement by and between Xxxxxx Xxxxx, Ltd. and Extrade, S.A. de
C.V. dated as of November 22, 1996.
2. Indenture dated as of December 27, 1993 among the Company, its subsidiaries
and Chemical Bank, as trustee, as amended by (i) the First Supplemental
Indenture dated as of August 3, 1994 among the Company, Canandaigua West,
Inc., and Chemical Bank, as trustee, (ii) the Second Supplemental Indenture
dated as of August 25, 1995 among the Company, V Acquisition Corp. (a
subsidiary of the Company now known as The Viking Distillery, Inc.), and
Chemical Bank, as trustee, (iii) Third Supplemental Indenture dated as of
December 19, 1997 among the Company, Canandaigua Europe Limited, Xxxxxxx
Trading Corp. and The Chase Manhattan Bank, as trustee, (iv) the Fourth
Supplemental Indenture dated as of October 2, 1998 among the Company,
Polyphenolics, Inc., and The Chase Manhattan Bank, as trustee, and (v) the
Fifth Supplemental Indenture dated as of December 11, 1998 among the
Company, Canandaigua B.V., and The Chase Manhattan Bank, as trustee.
3. Indenture with respect to the 8 3/4% Series C Senior Subordinated Notes due
2003 dated as of October 29, 1996 among the Company, its Subsidiaries and
Xxxxxx Trust and Savings Bank, as trustee, as amended by (i) the First
Supplemental Indenture dated as of December 19, 1997 among the Company,
Canandaigua Europe Limited, Xxxxxxx Trading Corp. and Xxxxxx Trust and
Savings Bank, (ii) the Second Supplemental Indenture dated as of October 2,
1998 among the Company, Polyphenolics, Inc. and Xxxxxx Trust and Savings
Bank, and (iii) the Third Supplemental Indenture dated as of December 11,
1998 among the Company, Canandaigua B.V. and Xxxxxx Trust and Savings Bank.
4. Indenture dated as of February 25, 1999 among the Company, the Guarantors
named therein and Xxxxxx Trust and Savings Bank as trustee, as amended by
Supplemental Indenture No. 1 dated as of February 25, 1999 among the
Company, the Guarantors named therein and Xxxxxx Trust and Savings Bank as
trustee, as further amended by Supplemental Indenture No. 2 dated as of
August 4, 1999 among the Company, the Guarantors named therein and Xxxxxx
Trust and Savings Bank, as trustee, as further amended by Supplemental
Indenture No. 3 dated as of August 6, 1999 among the Company, the New
Guarantors named therein and Xxxxxx Trust and Savings Bank, as trustee.
5. Xxxxxx Incorporated Management Incentive Plan.
-2-
6. Xxxxxx Brands, Ltd. Deferred Compensation Plan.
7. Xxxxxx Xxxxx Split Dollar Insurance Agreement.
8. Long-Term Stock Incentive Plan, which amends and restates the Canandaigua
Wine Company, Inc. Stock Option and Stock Appreciation Right Plan, as
amended by Amendment Number One to the Long-Term Stock Incentive Plan of the
Company.
9. Incentive Stock Option Plan of the Company, as amended by Amendment Number
One to the Incentive Stock Option Plan of the Company.
10. Annual Management Incentive Plan of the Company, as amended by Amendment
Number One to the Annual Management Incentive Plan of the Company.
11. Asset Purchase Agreement dated February 21, 1999 by and among the Company
and Diageo Inc., UDV Canada Inc., and United Distillers Canada Inc.
12. Stock Purchase Agreement by and between Canandaigua Wine Company, Inc. and
Moet Xxxxxxxx, Inc., dated as of April 1, 1999.
13. Stock Purchase Agreement between Franciscan Vineyards, the Selling
Shareholders and Selling Stockholders named therein, and Canandaigua Brands,
Inc., dated April 21, 1999; Vineyard Purchase Agreement between Canandiagua
Brands, Inc. and Xxxxx Properties, Inc., dated as of April 21, 1999;
Vineyard Purchase Agreement between Canandaigua Brands, Inc. and Stonewall
Canyon Vineyards, LLC, dated as of April 21, 1999; Grape Purchase Agreement,
between Franciscan Vineyards, Inc. Xxxxxxx-Xxxxxxx Properties, LLC and
Canandaigua Brands, Inc., dated as of June 4, 1999, Guaranty, by Canandaigua
Brands, Inc. in favor of Xxxxxxx-Xxxxxxx Properites LLC, dated as of June 4,
1999; Grape Purchase Agreement, between Franciscan Vineyards, Inc. H/Q
Vineyards LLC and Canandaigua Brands, Inc.; Guaranty, by Canandaigua Brands,
Inc. in favor of H/Q. Vineyards LLC, dated as of June 4, 1999; Wine
Processing Agreement, between Franciscan Vineyards, Inc., H/Q Wines LLC and
Canandaigua Brands, Inc., dated as of June 4, 1999; Guaranty, by Canandaigua
Brands, Inc. in favor of H/Q Wines LLC, dated as of June 4, 1999; ACSA Stock
Agreement, among Alto de Casablanca S.A., Franciscan Vineyards, Inc. and
Asesoria e Inversiones Xxx S.A., dated as of June 1, 1999; EVSA Stock
Agreement, among Empresas Vitivinicolas S.A., Franciscan Vineyards, Inc. and
Asesoria e Inversiones Xxx S.A., dated as of June 1, 1999; ACSA Distribution
Agreement, by and between Franciscan Vineyards, Inc., Alto de Casablanca
S.A., H/Q Wines LLC, International Brand Management, Ltd. and Canandaigua
Brands, Inc., dated as of June 4, 1999.
-3-
14. Credit Agreement, dated as of October 6, 1999 between the Company, the
Guarantors party thereto and the Agents and Lenders party thereto.
ANNEX II
Form of Opinion of Xxxxx Xxxxxxx LLP
(i) Each of the Subsidiaries of the Company listed on Exhibit I
attached hereto (the "Guarantors") is a corporation duly incorporated, in each
----------
case, validly existing and in good standing under the laws of its respective
jurisdiction of incorporation. The Company and each of the Guarantors is duly
qualified and in good standing as a foreign corporation in each jurisdiction
listed for it on Exhibit II attached hereto. The Company and each Guarantor has
all requisite corporate power to own, lease and license its respective
properties and conduct its business as now being conducted and as described in
the Prospectus. All of the issued and outstanding capital stock of each
Guarantor has been duly authorized and validly issued and is fully paid and non-
assessable and were not issued in violation of any preemptive or similar rights
of stockholders arising under the corporate law of the state of incorporation of
such Guarantor, the charter or bylaws of such Guarantor, or, to the best
knowledge of such counsel, any agreement to which such Guarantor is party, and,
to the best knowledge of such counsel, is owned by the Company, free and clear
of any lien, adverse claim, security interest, restriction on transfer,
shareholders' agreement, voting trust or other defect of title whatsoever except
for the liens under the Credit Agreement.
(ii) The Guarantors have the corporate power and authority to execute,
deliver and perform all of their respective obligations under the Underwriting
Agreement, the Indenture and the Guarantees. The execution, delivery and
performance of the Underwriting Agreement, Indenture, Notes and Guarantees by
the Company or any Guarantor, does not and will not (A) conflict with the
charter or bylaws of any Guarantor, (B) contravene the General Corporation Law
of the State of Delaware or any statute, rule or regulation under the laws of
the State of New York applicable to the Guarantors or any of their respective
properties, or (C) to the knowledge of such counsel, conflict with or violate
any judgment, decree or order of any court or governmental agency or court or
body applicable to any of the Guarantors or any of their respective properties.
(iii) The Underwriting Agreement, the Indenture and the Guarantees
have been duly authorized, executed and delivered by each Guarantor. The sale
and issuance of the Guarantees and the execution and delivery thereof have been
duly authorized by requisite corporate action of the Guarantors.
(iv) To the best knowledge of such counsel after due inquiry, except
as described or referred to in the Registration Statement and Prospectus: there
is not pending or threatened any action, suit, proceeding, inquiry or
investigation, to which the Company or any of the Guarantors is a party, or to
which the property of the Company or any
-2-
of the Guarantors is subject, before or brought by any court or governmental
agency or body, which, if determined adversely to the Company or any of the
Guarantors, will individually or in the aggregate result in any material adverse
change in the business, financial position, net worth, results of operations or
prospects, or materially adversely affect the properties or assets, of the
Company and the Guarantors taken as a whole or will materially adversely affect
the consummation of the transactions contemplated by the Prospectus; and all
pending legal or governmental proceedings to which the Company or any of the
Subsidiaries is a party or that affect any of their respective properties, that
are not described in the Registration Statement and Prospectus, including
ordinary routine litigation incidental to the business, considered in the
aggregate, will not result in a material adverse change in the business,
financial position, net worth, results of operations or prospects, or materially
adversely affect the properties or assets, of the Company and the Guarantors
taken as a whole.
(v) Each of the documents filed by the Company under the Exchange Act
and incorporated by reference into the Prospectus (collectively, the
"Documents"), at the time it was filed with the Commission, appeared on its face
---------
to be appropriately responsive in all material respects to the requirements of
the Exchange Act, and the rules and regulations as promulgated by the Commission
under the Exchange Act, except that such counsel need not express any opinion as
to the financial statements, schedules, and other financial data included
therein or incorporated by reference therein, or excluded therefrom or the
exhibits thereto (except to the extent set forth in the next sentence of this
paragraph) and such counsel need not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Documents. To such
counsel's knowledge without having made any independent investigation and based
upon representations of officers of the Company as to factual matters, there
were no contracts or documents required to be filed as exhibits to such
Documents on the date they were filed which were not so filed.
EXHIBIT I TO ANNEX II
Guarantors
----------
Guarantor State of Incorporation
--------- ----------------------
Xxxxxx Incorporated Delaware
Xxxxxx Brands, Ltd. Delaware
Batavia Wine Cellars, Inc. New York
Canandaigua Wine Company, Inc. New York
Franciscan Vineyards, Inc. Delaware
EXHIBIT II TO ANNEX II
----------------------
Company Foreign Qualifications
------- ----------------------
Canandaigua Brands, Inc. New York
California
Florida
Georgia
Michigan
Oklahoma
New Hampshire
North Carolina
New Jersey
Xxxxxx Incorporated None
Xxxxxx Brands, Ltd. California
Kentucky
Illinois
Florida
Maine
Oklahoma
New Hampshire
North Carolina
New Jersey
West Virginia
Batavia Wine Cellars, Inc. New Jersey
Canandaigua Wine Company, Inc. California
Washington
Oregon
Franciscan Vineyards California
ANNEX III
---------
Form of Opinion of Xxxxxxxx Chance and Xxxxx Xxxxxxx Xxxxxxx & Xxxxx LLP
(i) [ ]/1/ (the "Company") has been duly organized and is validly
-------
existing as a corporation and is in good standing under the laws of its
jurisdiction of incorporation.
(ii) The Company has the corporate power and authority to execute,
deliver and perform its obligations under the Underwriting Agreement, the
Indenture and the Guarantee. The Indenture, the Underwriting Agreement and the
Guarantee have been duly authorized for execution and delivery by the Company.
The sale and issuance by the Company of its Guarantee and the execution and
delivery thereof has been duly authorized by requisite corporation action of the
Company.
(iii) The execution, delivery, and performance by the Company of the
Underwriting Agreement, the Indenture and the Guarantee does not and will not
(A) conflict with the charter or By-Laws of the Company, (B) contravene and
statute, rule or regulation under the laws of its jurisdiction of incorporation
applicable to the Company and its properties, or (c) to counsel's knowledge,
conflict with or violate any judgment, decree or order of any court or
governmental agency or court or body applicable to the Company and its
properties (except that no opinion need be expressed with respect to the
securities or Blue Sky laws of its jurisdiction of incorporation)./2/
BST99 1124851-1.025309.0011
-------------------------
/1/ This opinion will be given as to Canadaigua Limited by Xxxxxxxx Chance and
as to Xxxxxx Xxxxx, Ltd. by Xxxxx Xxxxxxx Xxxxxxx & Xxxxx LLP.
/2/ For purposes of the Xxxxxxxx Chance opinion only, paragraph (iii)(c) of
this form of opinion may be substituted for by an officer's certificate.
