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EXHIBIT 1.1
$130,000,000
CHIEF AUTO PARTS INC.
___% Senior Notes Due 2005
UNDERWRITING AGREEMENT
_______ _, 1997
CREDIT SUISSE FIRST BOSTON CORPORATION
SALOMON BROTHERS INC
c/o Credit Suisse First Boston Corporation
Xxxxxx Xxxxxxx Xxxxxx
Xxx Xxxx, X.X. 10010-3629
Ladies and Gentlemen:
1. Introductory. Chief Auto Parts Inc. , a Delaware corporation
("Company"), proposes to issue and sell $130,000,000 principal amount of its ___
% Senior Notes Due 2005 ("Securities") to be issued under an indenture, dated as
of __________, 1997 ("Indenture"), between the Company and First Trust National
Association, as Trustee. As described in the Prospectus (as defined below),
the offering of the Securities is part of a recapitalization (the
"Recapitalization") of the Company. The elements of the Recapitalization consist
of (i) the completion of the offering of the Securities, (ii) the exercise of
outstanding options to purchase 4,839.97 shares of common stock of the Company,
par value $.01 per share, by holders of such options, (iii) the repayment by
members of management of the Company of a portion of the amounts owed to the
Company under certain promissory notes, (iv) the establishment of a new credit
facility (the "New Credit Facility"), which will provide for a $100.0 million
revolving credit facility and (v) the application of the aggregate net proceeds
from the foregoing as set forth in the Prospectus under "Use of Proceeds."
The Company hereby agrees with the several Underwriters named in Schedule A
hereto ("Underwriters") as follows:
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2. Representations and Warranties of the Company. The Company represents
and warrants to, and agrees with, the several Underwriters that:
(a) A registration statement (No. 333-24029) relating to the
Securities, including a form of prospectus, has been filed with the
Securities and Exchange Commission ("Commission") and either (i) has
been declared effective under the Securities Act of 1933, as amended
("Act"), and is not proposed to be amended or (ii) is proposed to be
amended by amendment or post-effective amendment. If such registration
statement ("initial registration statement") has been declared
effective, either (i) an additional registration statement ("additional
registration statement") relating to the Securities may have been filed
with the Commission pursuant to Rule 462(b) ("Rule 462(b)") under the
Act and, if so filed, has become effective upon filing pursuant to such
Rule and the Securities all have been duly registered under the Act
pursuant to the initial registration statement and, if applicable, the
additional registration statement or (ii) such an additional
registration statement is proposed to be filed with the Commission
pursuant to Rule 462(b) and will become effective upon filing pursuant
to such Rule and upon such filing the Securities will all have been
duly registered under the Act pursuant to the initial registration
statement and such additional registration statement. If the Company
does not propose to amend the initial registration statement or if an
additional registration statement has been filed and the Company does
not propose to amend it, and if any post-effective amendment to either
such registration statement has been filed with the Commission prior to
the execution and delivery of this Agreement, the most recent amendment
(if any) to each such registration statement has been declared
effective by the Commission or has become effective upon filing
pursuant to Rule 462(c) ("Rule 462(c)") under the Act or, in the case
of the additional registration statement, Rule 462(b). For purposes of
this Agreement, "Effective Time" with respect to the initial
registration statement or, if filed prior to the execution and delivery
of this Agreement, the additional registration statement means (i) if
the Company has advised the Underwriters that it does not propose to
amend such registration statement, the date and time as of which such
registration statement, or the most recent post-effective amendment
thereto (if any) filed prior to the execution and delivery of this
Agreement, was declared effective by the Commission or has become
effective upon filing pursuant to Rule 462(c), or (ii) if the Company
has advised the Underwriters that it proposes to file an amendment or
post-effective amendment to such registration statement, the date and
time as of which such registration statement, as amended by such
amendment or post-effective amendment, as the case may be, is declared
effective by the Commission. If an additional registration statement
has not been filed prior to the execution and delivery of this
Agreement but the Company has advised the Underwriters that it proposes
to file one, "Effective Time" with respect to such additional
registration statement means the date and time as of which such
registration statement is filed and becomes effective pursuant to Rule
462(b). "Effective Date" with respect to the initial registration
statement or the additional registration statement (if any) means the
date of the Effective Time thereof. The initial registration statement,
as amended at its Effective Time, including all information contained
in the additional registration statement (if any) and deemed to be a
part of the initial registration statement as of the Effective Time of
the additional registration statement pursuant to the General
Instructions of the Form on which it is filed and including all
information (if any) deemed to be a part of the initial registration
statement as of its Effective Time pursuant to Rule 430A(b) ("Rule
430A(b)") under the Act, is hereinafter referred to as the "Initial
Registration Statement". The additional registration statement, as
amended at its Effective Time, including the contents of the initial
registration statement incorporated by reference therein and including
all information (if any) deemed to be a part of the additional
registration statement as of its Effective Time pursuant to Rule
430A(b), is hereinafter referred to as the "Additional Registration
Statement". The Initial Registration Statement and the Additional
Registration Statement are herein referred to collectively as the
"Registration
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Statements" and individually as a "Registration Statement". The form
of prospectus relating to the Securities, as first filed with the
Commission pursuant to and in accordance with Rule 424(b) ("Rule
424(b)") under the Act or (if no such filing is required) as included
in a Registration Statement, is hereinafter referred to as the
"Prospectus". No document has been or will be prepared or distributed
in reliance on Rule 434 under the Act.
(b) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement: (i) on the
Effective Date of the Initial Registration Statement, the Initial
Registration Statement conformed in all material respects to the
applicable requirements of the Act, the Trust Indenture Act of 1939, as
amended ("Trust Indenture Act") and the rules and regulations of the
Commission promulgated thereunder ("Rules and Regulations") and did not
include any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading, (ii) on the Effective Date of the
Additional Registration Statement (if any), each Registration Statement
conformed, or will conform, in all material respects to the applicable
requirements of the Act, the Trust Indenture Act and the Rules and
Regulations and did not include, or will not include, any untrue
statement of a material fact and did not omit, or will not omit, to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading and (iii) on the date of
this Agreement, the Initial Registration Statement and, if the
Effective Time of the Additional Registration Statement is prior to the
execution and delivery of this Agreement, the Additional Registration
Statement each conforms, and at the time of filing of the Prospectus
pursuant to Rule 424(b) or (if no such filing is required) at the
Effective Date of the Additional Registration Statement in which the
Prospectus is included, each Registration Statement and the Prospectus
will conform, in all respects to the requirements of the Act, the Trust
Indenture Act and the Rules and Regulations, and neither of such
documents includes, or will include, any untrue statement of a material
fact or omit to state any material fact or necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading. If the Effective Time of the Initial
Registration Statement is subsequent to the execution and delivery of
this Agreement: (i) as of its Effective Date, the Initial Registration
Statement will comply as to form in all material respects to the
applicable requirements of the Act, the Trust Indenture Act and the
Rules and Regulations, will not include any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, and
no Additional Registration Statement has been or will be filed and (ii)
The Prospectus, at the time of its filing pursuant to Rule 424(b) or
(if no such filing is required) at the Effective Date of the Additional
Registration Statement in which the Prospectus is included will not
include any untrue statement of material fact or omit to state any
material fact necessary, in the light of the circumstances under which
they were made, not misleading. The two preceding sentences do not
apply to (i) that part of a Registration Statement which shall
constitute the Statement of Eligibility and Qualification (Form T-1) of
the Trustee under the Trust Indenture Act or (ii) statements in or
omissions from a Registration Statement or the Prospectus based upon
written information furnished to the Company by any Underwriter
specifically for use therein, it being understood and agreed that the
only such information is that described as such in Section 7(b) hereof.
(c) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware,
has the power and authority (corporate and other) to own its properties
and conduct its business as described in the Prospectus, and is duly
qualified to do business as a foreign corporation in good standing in
all other jurisdictions in which its ownership or lease of property or
the conduct of its business requires such qualification, except where
the failure to have such power or authority or to be so qualified would
not have a Material Adverse Effect (as defined).
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(d) The Company has no subsidiaries other than CAP Acquisition
Corp., a Delaware corporation. CAP Acquisition Corp. is inactive and
has total assets less than $10,000. All of the issued and outstanding
capital stock of CAP Acquisition Corp. is owned directly by the
Company.
(e) The Indenture has been duly authorized by the Company and, if
the Effective Time of a Registration Statement is prior to the
execution and delivery of this Agreement, has been or otherwise upon
such Effective Time will be duly qualified under the Trust Indenture
Act with respect to the Securities registered thereby; the Securities
have been duly authorized by the Company; and when the Securities are
delivered, authenticated by the Trustee in accordance with the
provisions of the Indenture and paid for pursuant to this Agreement on
the Closing Date (as defined below), the Indenture will have been duly
executed and delivered by the Company, such Securities will have been
duly executed, issued and delivered and will conform in all material
respects to the description thereof contained in the Prospectus and
the Indenture, when duly executed and delivered by the Trustee, and
such Securities, when duly authenticated by the Trustee, will
constitute valid and legally binding obligations of the Company,
enforceable against the Company in accordance with their terms,
subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and remedies generally and
to general equity principles (regardless of whether enforcement is
sought in a proceeding at law or in equity).
(f) Other than this Agreement, there are no contracts, agreements
or understandings between the Company and any person that would give
rise to a valid claim against the Company or any Underwriter for a
brokerage commission, finder's fee or other like payment in connection
with this offering of the Securities.
(g) There are no contracts, agreements or understandings between
the Company and any person granting such person the right to require
the Company to include securities of the Company owned or to be owned
by such person in the securities registered pursuant to the
Registration Statement and, except as disclosed in the Prospectus, and
except for the currently outstanding warrants to purchase 6,090.1
shares of the Company's Common Stock, no such person has the right to
require the Company to file a registration statement under the Act
with respect to any securities of the Company.
(h) No consent, approval, authorization, or order of, or filing
with, any governmental agency or body or any court is required for the
consummation by the Company of the transactions contemplated by this
Agreement in connection with the issuance and sale of the Securities
by the Company, except such as have been or, prior to the Closing
Date, will have been obtained and made under the Act and the Trust
Indenture Act and such as may be required under state securities or
"blue sky" laws.
(i) Each of the execution, delivery and performance by the
Company of the Indenture and this Agreement, the consummation by the
Company of each element of the Recapitalization and the issuance and
sale of the Securities and compliance by the Company with the terms
and provisions thereof will not result in a breach or violation of any
of the terms and provisions of, or constitute a default under,
(assuming compliance with all applicable state securities or "blue sky
laws and, for purposes of this clause 2(i) only, the Act) any statute,
any rule, regulation or order of any governmental agency or body or
any court, domestic or foreign, having jurisdiction over the Company
or any of its properties, or any agreement or instrument to which the
Company is a party or by which the Company is bound or to which any of
the properties of the Company is subject, (except as would not have
Material Adverse Effect) or the charter or by-laws of the
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Company, and the Company has all requisite power and authority to
authorize, issue and sell the Securities as contemplated by this
Agreement.
(j) This Agreement has been duly authorized, executed and
delivered by the Company.
(k) The Company has good and marketable title to all real
properties and good title to all other properties and assets owned by
it, in each case free from liens, encumbrances and defects, except as
described in the Prospectus or to the extent the failure to have such
title or the existence of such liens, encumbrances or defects would
not have, individually or in the aggregate, a Material Adverse Effect,
other than liens granted to the Company's lender under the Existing
Credit Facility or to be granted under the New Credit Facility; and
the Company holds any leased real or personal property under valid and
enforceable leases with no exceptions, except as described in the
Prospectus or to the extent the failure to so hold or the existence of
such exceptions would not have, individually or in the aggregate, a
Material Adverse Effect.
(l) The Company possesses adequate certificates, authorities or
permits issued by appropriate governmental agencies or bodies
necessary to conduct the business now operated by it and has not
received any notice of proceedings relating to the revocation or
modification of any such certificate, authority or permit that, if
determined adversely to the Company, would individually or in the
aggregate have a material adverse effect on the condition (financial
or other), business, properties or results of operations of the
Company (a "Material Adverse Effect").
(m) No labor dispute with the employees of the Company exists or,
to the knowledge of the Company, is threatened that would reasonably
be expected to have a Material Adverse Effect.
(n) The Company owns, possesses or can acquire on reasonable
terms, adequate trademarks, trade names and other rights to
inventions, know-how, patents, copyrights, confidential information
and other intellectual property (collectively, "intellectual property
rights") necessary to conduct the business now operated by it and has
not received any notice of infringement of or conflict with asserted
rights of others with respect to any intellectual property rights
that, if determined adversely to the Company, would individually or in
the aggregate reasonably be expected to have a Material Adverse
Effect.
(o) The Company is not in violation of any statute, any rule,
regulation, decision or order of any governmental agency or body or
any court, domestic or foreign, relating to the use, disposal or
release of hazardous or toxic substances or relating to the protection
or restoration of the environment or human exposure to hazardous or
toxic substances (collectively, "environmental laws"), does not own or
operate any real property contaminated with any substance that is
subject to any environmental laws, is not liable for any off-site
disposal or contamination pursuant to any environmental laws, or is
not subject to any claim relating to any environmental laws, which
violation, contamination, liability or claim would individually or in
the aggregate have a Material Adverse Effect, and the Company is not
aware of any pending investigation which might reasonably be expected
to lead to such a claim.
(p) Except as disclosed in the Prospectus, there are no pending
actions, suits or proceedings against or affecting the Company or any
of its properties that, if determined adversely to the Company, would
individually or in the aggregate reasonably be expected to have a
Material Adverse Effect, or would materially and adversely affect the
ability of the Company to perform its obligations under the Indenture
or this Agreement, or which are otherwise material in the context of
the sale of the Securities; and no such actions, suits or proceedings
are, to the Company's knowledge, threatened or contemplated.
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(q) The financial statements included in each Registration
Statement and the Prospectus present fairly the financial position of
the Company as of the dates shown and its results of operations and
cash flows for the periods shown, and such financial statements have
been prepared in conformity with the generally accepted accounting
principles in the United States applied on a consistent basis; the
schedules included in each Registration Statement present fairly the
information required to be stated therein; and the assumptions used in
preparing the pro forma financial statements (including the notes
thereto) included in each Registration Statement and the Prospectus
provide a reasonable basis for presenting the significant effects
directly attributable to the transactions or events described therein,
the related pro forma adjustments give appropriate effect to those
assumptions, and the pro forma columns therein reflect the proper
application of those adjustments to the corresponding historical
financial statement amounts. With respect to the Company, Price
Waterhouse LLP is an independent public accounting firm within the
meaning of the Act and the Rules and Regulations.
(r) The Company does not have any material liability for any
prohibited transaction or funding deficiency or any complete or
partial withdrawal liability with respect to any pension, profit
sharing or other plan which is subject to the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), to which it makes
or ever has made a contribution and in which any employee of it is or
has ever been a participant. With respect to such plans, the Company
is in compliance in all material respects with all applicable
provisions of ERISA.
(s) The Company has filed all necessary federal, state and
foreign income and franchise tax returns, except where the failure to
so file such returns would not, individually or in the aggregate, have
a Material Adverse Effect, and has paid all material taxes shown as
due thereon; and other than tax deficiencies which the Company is
contesting in good faith and for which the Company has provided
adequate reserves, there is no tax deficiency that has been asserted
against the Company that would have, individually or in the aggregate,
a Material Adverse Effect.
(t) Except as disclosed in the Prospectus, since the date of the
latest financial statements included in the Prospectus there has been
no material adverse change, nor any development or event involving a
prospective material adverse change, in the condition (financial or
other), business, properties or results of operations of the Company,
and, except as disclosed in or contemplated by the Prospectus, there
has been no dividend or distribution of any kind declared, paid or
made by the Company on any class of its capital stock.
(u) The Company is not and, after giving effect to the offering
and sale of the Securities and the application of the proceeds thereof
as described in the Prospectus, will not be required to register as an
"investment company" or an entity "controlled" by an investment
company, as such terms are defined in the Investment Company Act of
1940, as amended.
(v) Neither the Company nor any of its affiliates does business
with the government of Cuba or with any person or affiliate located in
Cuba within the meaning of Section 517.075, Florida Statutes and the
Company agrees to comply with such Section if prior to the completion
of the distribution of the Securities it commences doing such
business.
(w) A true and correct copy of the executed New Credit Facility
has been or will be delivered to the Underwriters and counsel to the
Underwriters on or prior to the Closing Time. The Company has the
corporate power to execute, deliver and perform the terms and
provisions of the New Credit Facility to be performed by it and has
taken all necessary corporate action to authorize the execution,
delivery and performance by it of the New Credit Facility. The New
Credit
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Facility, when executed and delivered by the Company (assuming due
authorization, execution and delivery thereof by the other parties
thereto) will be a valid and binding agreement of the Company,
enforceable against it in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium or similar laws affecting the
enforceability or creditors' rights and remedies generally and by
equitable principles of general applicability (regardless of whether
such enforceability is considered in a proceeding in equity or at
law). If the New Credit Facility has already been executed, there have
been no amendments, alterations, modifications or waivers of the
provisions thereof. The New Credit Facility or will conform in all
material respects to the description thereof in the Prospectus.
(x) Immediately after the consummation of the Recapitalization,
the fair market value and present fair saleable value of the assets of
the Company will exceed the sum of its stated liabilities and
identified contingent liabilities; the Company is not, nor will it be,
after giving effect to the execution, delivery and performance of this
Agreement and the consummation of the Recapitalization, (a) left with
unreasonably small capital with which to carry on its business as it
is proposed to be conducted, (b) unable to pay its debts (contingent
or otherwise) as they mature or (c) otherwise insolvent.
3. Purchase, Sale and Delivery of Securities. On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions herein set forth, the Company agrees to sell to the
Underwriters, and the Underwriters agree, severally and not jointly, to purchase
from the Company, at a purchase price of ___% of the principal amount thereof
plus accrued interest from
to the Closing Date, the respective principal amounts of
Securities set forth opposite the names of the Underwriters in Schedule A
hereto.
The Company will deliver against payment of the purchase price the
Securities in the form of one or more permanent global Securities in definitive
form (the "Global Securities") deposited with the Trustee as custodian for The
Depository Trust Company ("DTC") and registered in the name of Cede & Co., as
nominee for DTC. Interests in any permanent global Securities will be held only
in book-entry form through DTC[, except in the limited circumstances provided
for by the procedures of DTC]. Payment for the Securities shall be made by the
Underwriters in Federal (same day) funds by official bank check or checks drawn
to the order of the Company or wire transfer to a bank account of the Company,
designated at least 2 business days prior to the Closing Date, at the office of
Xxxxxx Xxxxxx & Xxxxxxx at 9:00 A.M., (New York time), on or at such other time
not later than seven full business days thereafter as Credit Suisse First Boston
Corporation ("CSFB") and the Company determine, such time being herein referred
to as the "Closing Date", against delivery to the Trustee as custodian for DTC
of the Global Securities representing all of the Securities. The Global
Securities will be made available for checking at the office of Xxxxxx Xxxxxx &
Xxxxxxx at least 24 hours prior to the Closing Date.
4. Offering by Underwriters. It is understood that the several Underwriters
propose to offer the Securities for sale to the public as set forth in the
Prospectus.
5. Certain Agreements of the Company. The Company agrees with the several
Underwriters that:
(a) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement, the Company will
file the Prospectus with the Commission pursuant to and in accordance
with subparagraph (1) (or, if applicable and if consented to by CSFBC,
subparagraph (4)) of Rule 424(b) within the time period prescribed in
such Rule. The Company will advise CSFBC promptly of any such filing
pursuant to Rule 424(b). If the Effective Time of the Initial
Registration Statement is prior to the execution and delivery of this
Agreement and an additional registration statement is necessary to
register a portion of the Securities under the Act
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but the Effective Time thereof has not occurred as of such execution
and delivery, the Companywill file the additional registration
statement or, if filed, will file a post-effective amendment thereto
with the Commission pursuant to and in accordance with Rule 462(b) on
or prior to 10:00 P.M., New York time, on the date of this Agreement
or, if earlier, on or prior to the time the Prospectus is printed and
distributed to any Underwriter, or will make such filing at such later
date as shall have been consented to by CSFBC.
(b) The Company will advise CSFBC promptly of any proposal to
amend or supplement the initial or any additional registration
statement as filed or the related prospectus or the Initial
Registration Statement, the Additional Registration Statement (if any)
or the Prospectus and will not effect such amendment or supplementation
without CSFBC's consent; and the Company will also advise CSFBC
promptly of the effectiveness of each Registration Statement (if its
Effective Time is subsequent to the execution and delivery of this
Agreement) and of any amendment or supplementation of a Registration
Statement or the Prospectus and of the institution by the Commission of
any stop order proceedings in respect of a Registration Statement and
will use its best efforts to prevent the issuance of any such stop
order and to obtain as soon as possible its lifting, if issued.
(c) If, at any time when a prospectus relating to the Securities
is required to be delivered under the Act in connection with sales by
any Underwriter or dealer, any event occurs 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 to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it is
necessary at any such time to amend or supplement the Prospectus to
comply with the Act, the Company will promptly notify CSFBC of such
event and will promptly prepare and file with the Commission, at its
own expense, an amendment or supplement which will correct such
statement or omission or an amendment which will effect such
compliance. Neither CSFBC's consent to, nor the Underwriters' delivery
of, any such amendment or supplement shall constitute a waiver of any
of the conditions set forth in Section 6.
(d) As soon as practicable, but not later than the Availability
Date (as defined below), the Company will make generally available to
its securityholders an earnings statement (which need not be certified
by an independent public accountant) covering a period of at least 12
months beginning after the Effective Date of the Initial Registration
Statement (or, if later, the Effective Date of the Additional
Registration Statement) which will satisfy the provisions of Section
11(a) of the Act. For the purpose of the preceding sentence,
"Availability Date" means the 45th day after the end of the fourth
fiscal quarter following the fiscal quarter that includes such
Effective Date, except that, if such fourth fiscal quarter is the last
quarter of the Company's fiscal year, "Availability Date" means the
90th day after the end of such fourth fiscal quarter.
(e) The Company will furnish to the Underwriters copies of each
Registration Statement (3 of which will be signed and will include all
exhibits), each related preliminary prospectus, and, so long as a
prospectus relating to the Securities is required to be delivered under
the Act in connection with sales by any Underwriter or dealer, the
Prospectus and all amendments and supplements to such documents, in
each case in such quantities as CSFBC reasonably requests. The
Prospectus shall be so furnished on or prior to 3:00 P.M., New York
time, on the business day following the later of the execution and
delivery of this Agreement or the Effective Time of the Initial
Registration Statement. All other documents shall be so furnished as
soon as available. The Company will pay the expenses of printing and
distributing to the Underwriters all such documents.
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(f) The Company will take such action as the Underwriters may
reasonably request to qualify the Securities for offering and sale and
the determination of their eligibility for investment under the laws
of such jurisdictions as CSFBC designates and to comply with such laws
so as to permit the continuance of such qualifications in effect so
long as required for the distribution of the Securities, provided that
in connection therewith the Company shall not be required to qualify
as a foreign corporation or to file a general consent to service of
process in any jurisdiction where it is not so qualified or so
subject.
(g) For and during the period ending on the date no Securities
are outstanding, the Company will furnish to the Underwriters copies
of all reports and other communications (financial or otherwise)
furnished by the Company to the Trustee or the holders of the
Securities and, as soon as available, copies of any reports or
financial statements furnished to or filed by the Company with the
Commission or any national securities exchange on which any class of
securities of the Company may be listed.
(h) The Company will apply the net proceeds from the sale of the
Securities as set forth under "Use of Proceeds" in the Prospectus.
(i) The Company will pay all expenses incident to the performance
of its obligations under this Agreement, for any filing fees and other
expenses (including fees and disbursements of counsel) incurred in
connection with qualification of the Securities for sale under the
laws of such jurisdictions as CSFBC designates and the printing of
memoranda relating thereto, for any fees charged by investment rating
agencies for the rating of the Securities, for the filing fee incident
to the review by the National Association of Securities Dealers, Inc.
of the Securities, for any travel expenses of the Company's officers
and employees and any other expenses of the Company in connection with
attending or hosting meetings with prospective purchasers of the
Securities and for expenses incurred in distributing preliminary
prospectuses and the Prospectus (including any amendments and
supplements thereto) to the Underwriters.
6. Conditions of the Obligations of the Underwriters. The obligations
of the several Underwriters to purchase and pay for the Securities on the
Closing Date will be subject to the accuracy of the representations and
warranties on the part of the Company herein, to the accuracy of the statements
of Company officers made pursuant to the provisions hereof, to the performance
by the Company of its obligations hereunder and to the following additional
conditions precedent:
(a) The Underwriters shall have received a letter, dated the
date of delivery thereof (which, if the Effective Time of the Initial
Registration Statement is prior to the execution and delivery of this
Agreement, shall be on or prior to the date of this Agreement or, if
the Effective Time of the Initial Registration Statement is subsequent
to the execution and delivery of this Agreement, shall be prior to the
filing of the amendment or post-effective amendment to the registration
statement to be filed shortly prior to such Effective Time), of Price
Waterhouse LLP confirming that, with respect to the Company, they are
independent public accountants within the meaning of the Act and the
applicable published Rules and Regulations thereunder and stating to
the effect that:
(i) in their opinion the financial statements and schedules
examined by them and included in the Registration Statements
comply as to form in all material respects with the applicable
accounting requirements of the Act and the related published
Rules and Regulations;
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(ii) they have performed the procedures specified by the American
Institute of Certified Public Accountants for a review of interim
financial information as described in Statement of Auditing
Standards No. 71, Interim Financial Information, on the unaudited
financial statements included in the Registration Statements;
(iii) on the basis of the review referred to in clause (ii)
above, a reading of the latest available interim financial
statements of the Company, inquiries of officials of the Company
who have responsibility for financial and accounting matters and
other procedures specified in such letter nothing came to their
attention that caused them to believe that:
(A) the unaudited financial statements included in the
Registration Statements do not comply as to form in all
material respects with the applicable accounting
requirements of the Act and the related published Rules and
Regulations or any material modifications should be made to
such unaudited financial statements for them to be in
conformity with generally accepted accounting principles;
(B) at the date of the latest available balance sheet read
by such accountants, or at a subsequent specified date not
more than three business days prior to the date of this
Agreement, there was any change in the capital stock or any
increase in short-term indebtedness or long-term debt of the
Company or, at the date of the latest available balance
sheet read by such accountants, there was any decrease in
consolidated net assets as compared with amounts shown on
the latest balance sheet included in the Prospectus; or
(C) for the period from the closing date of the latest
income statement included in the Prospectus to the closing
date of the latest available income statement read by such
accountants there were any decreases, as compared with the
corresponding period of the previous year in consolidated
net sales or net operating income, income before
extraordinary items, net income or in the ratio of earnings
to fixed charges,
except in all cases set forth in clauses (B) and (C) above for
changes, increases or decreases which the Prospectus discloses have
occurred or may occur; and
(iv) they have compared specified dollar amounts (or percentages
derived from such dollar amounts) and other financial information
contained in the Registration Statements (in each case to the extent
that such dollar amounts, percentages and other financial information
are derived from the general accounting records of the Company subject
to the internal controls of the Company's accounting system or are
derived directly from such records by analysis or computation) with
the results obtained from inquiries, a reading of such general
accounting records and other procedures specified in such letter and
have found such dollar amounts, percentages and other financial
information to be in agreement with such results.
For purposes of this subsection, (i) if the Effective Time of the Initial
Registration Statement is subsequent to the execution and delivery of this
Agreement, "Registration Statements" shall mean the initial registration
statement as proposed to be amended by the amendment or post-effective
amendment to be filed shortly prior to its Effective Time, (ii) if the
Effective Time of the Initial Registration Statement is prior to the
execution and delivery of this Agreement but the Effective Time of the
Additional Registration is subsequent to such execution and delivery,
"Registration
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Statements" shall mean the Initial Registration Statement and the
additional registration statement as proposed to be filed or as proposed to
be amended by the post-effective amendment to be filed shortly prior to its
Effective Time, and (iii) "Prospectus" shall mean the prospectus included
in the Registration Statements.
(b) If the Effective Time of the Initial Registration Statement is not
prior to the execution and delivery of this Agreement, such Effective Time
shall have occurred not later than 10:00 P.M., New York time, on the date
of this Agreement or such later date as shall have been consented to by
CSFBC. If the Effective Time of the Additional Registration Statement (if
any) is not prior to the execution and delivery of this Agreement, such
Effective Time shall have occurred not later than 10:00 P.M., New York
time, on the date of this Agreement or, if earlier, the time the Prospectus
is printed and distributed to any Underwriter, or shall have occurred at
such later date as shall have been consented to by CSFBC. If the Effective
Time of the Initial Registration Statement is prior to the execution and
delivery of this Agreement, the Prospectus shall have been filed with the
Commission in accordance with the Rules and Regulations and Section 5(a) of
this Agreement. Prior to the Closing Date, no stop order suspending the
effectiveness of a Registration Statement shall have been issued and no
proceedings for that purpose shall have been instituted or, to the
knowledge of the Company or the Underwriters, shall be contemplated by the
Commission.
(c) The representations and warranties of the Company contained in
this Agreement shall be true and correct in all material respects on and as
of the date hereof and on and as of the Closing Date as if made on and as
of the Closing Date; the statements of the officers of the Company made
pursuant to any certificate delivered in accordance with the provisions
hereof shall be true and correct on and as of the date made and on and as
of the Closing Date; the Company shall have performed all covenants and
agreements and satisfied all conditions on its part to be performed or
satisfied hereunder at or prior to the Closing Date.
(d) Subsequent to the execution and delivery of this Agreement, there
shall not have occurred (i) any change, or any development or event
involving a prospective change, in the condition (financial or other),
business, properties or results of operations of the Company which, in the
judgment of CSFBC is material and adverse and makes it impractical or
inadvisable to proceed with completion of the public offering or the sale
of and payment for the Securities; (ii) any downgrading in the rating of
any debt securities of the Company by any "nationally recognized
statistical rating organization" (as defined for purposes of Rule 436(g)
under the Act), or any public announcement that any such organization has
under surveillance or review its rating of any debt securities of the
Company (other than an announcement with positive implications of a
possible upgrading, and no implication of a possible downgrading, of such
rating); (iii) any suspension or limitation of trading in securities
generally on the New York Stock Exchange, or any setting of minimum prices
for trading on such exchange, or any suspension of trading of any
securities of the Company on any exchange or in the over-the-counter
market; (iv) any banking moratorium declared by U.S. Federal or New York
State authorities; or (v) any outbreak or escalation of major hostilities
in which the United States is involved, any declaration of war by Congress
or any other substantial national or international calamity or emergency
if, in the judgment of CSFBC, the effect of any such outbreak, escalation,
declaration, calamity or emergency makes it impractical or inadvisable to
proceed with completion of the public offering or the sale of and payment
for the Securities.
(e) The Underwriters shall have received an opinion, dated such
Closing Date, of Xxxxxx Xxxx & Xxxxxxxx LLP, counsel for the Company, to
the effect that:
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(i) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware,
has the requisite corporate power and authority to own its properties
and conduct its business as described in the Prospectus and is duly
qualified to do business as a foreign corporation in good standing in
all other jurisdictions in which its ownership or lease of property or
the conduct of its business requires such qualification, except where
the failure to have such power or authority or to be so qualified
would not have a Material Adverse Effect;
(ii) The Indenture has been duly authorized, executed and
delivered by the Company and has been duly qualified under the Trust
Indenture Act; the Securities delivered on the Closing Date have been
duly authorized, executed, and assuming due authentication thereof by
the Trustee, issued and delivered by the Company and conform in all
material respects to the description thereof contained in the
Prospectus; and the Indenture and the Securities (when paid for by the
Underwriters in accordance with this Agreement) delivered on the
Closing Date constitute valid and legally binding obligations of the
Company enforceable against the Company in accordance with their terms
(assuming due execution and delivery by the other parties thereto),
subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and remedies generally and
to general equity principles (regardless of whether enforcement is
sought in a proceeding at law or in equity);
(iii) There are no contracts, agreements or understandings known
to such counsel between the Company and any person granting such
person the right to require the Company to include securities owned or
to be owned by such person in the securities registered pursuant to
the Registration Statement and, except as disclosed in the Prospectus
and except for the currently outstanding warrants to purchase 6,090.1
shares of the Company's common Stock, no such person has the right to
require the Company to file a registration statement under the Act
with respect to any securities of the Company.
(iv) No consent, approval, authorization or order of, or filing
with, any governmental agency or body or any court is required for the
consummation by the Company of the transactions contemplated by this
Agreement in connection with the issuance or sale of the Securities by
the Company, except such as have been obtained and made under the Act
and the Trust Indenture Act and such as may be required under state
securities or "blue sky" laws;
(v) Each of the execution, delivery and performance by the
Company of the Indenture and this Agreement, the consummation by the
Company of each element of the Recapitalization and the issuance and
sale of the Securities and compliance by the Company with the terms
and provisions thereof will not result in a breach or violation of any
of the terms and provisions of, or constitute a default under
(assuming compliance with all applicable state securities or "blue
sky" laws and, for purposes of this clause (v) only, the Act), any
statute, any rule, regulation or order known to such counsel of any
governmental agency or body or any court having jurisdiction over the
Company or any of its properties, or any agreement or instrument
[identified to such counsel in a certificate of the Company as being a
material instrument] to which the Company is a party or by which the
Company is bound or to which any of the properties of the Company is
subject, or the charter or by-laws of the Company. The Company has the
requisite corporate authority to authorize, issue and sell the
Securities as contemplated by this Agreement;
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(vi) The Initial Registration Statement was declared effective
under the Act as of the date and time specified in such opinion, the
Additional Registration Statement (if any) was filed and became
effective under the Act as of the date and time (if determinable)
specified in such opinion, the Prospectus either was filed with the
Commission pursuant to the subparagraph of Rule 424(b) specified in
such opinion on the date specified therein or was included in the
Initial Registration Statement or the Additional Registration
Statement (as the case may be). To the best of the knowledge of such
counsel, no stop order suspending the effectiveness of a Registration
Statement has been issued and no proceedings for that purpose have
been instituted or are pending or contemplated under the Act. Such
counsel does not have actual knowledge of any legal or governmental
proceedings required to be described in a Registration Statement or
the Prospectus which are not described as required or [(based solely
upon such counsel's review of the Company's corporate records, minute
books, charter documents and those contracts of the Company identified
to such counsel as material in a certificate of the Company)] of any
contracts or documents of a character required to be described in a
Registration Statement or the Prospectus or to be filed as exhibits to
a Registration Statement which are not described and filed as
required.
(vii) This Agreement has been duly authorized, executed and
delivered by the Company;
(viii) Except as disclosed in the Prospectus, to the best of such
counsel's knowledge, there are no pending actions, suits or
proceedings against or affecting the Company or its properties that,
if determined adversely to the Company, would individually or in the
aggregate reasonably be expected to have a Material Adverse Effect, or
would materially and adversely affect the ability of the Company to
perform its obligations under the Indenture or this Agreement, or
which are otherwise material in the context of the sale of the
Securities; and no such actions, suits or proceedings are to the
Company's knowledge, threatened or, contemplated;
(ix) The Company is not, nor immediately after the sale of the
Securities and the application of the proceeds from such sale as
described in the Prospectus will it be, required to register as an
"investment company" or an entity "controlled" by an "investment
company", as such terms are defined in the Investment Company Act of
1940, as amended;
(x) The Company has the corporate power to execute, deliver and
perform the terms and provisions of the New Credit Facility and has
taken all necessary corporate action to authorize the execution,
delivery and performance by it of the New Credit Facility. The Company
has duly executed and delivered the New Credit Facility. Assuming due
authorization, execution and delivery thereof by the other parties
thereto, the New Credit Facility is a valid and binding agreement of
the Company, enforceable against it in accordance with its terms,
except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the
enforceability or creditors' rights and remedies generally and by
equitable principles of general applicability (regardless of whether
such enforceability is considered in a proceeding in equity or at
law); and
(xi) The authorized, issued and outstanding capital stock of the
Company is as set forth in the Prospectus under the caption
"Capitalization".
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Such counsel shall state that such counsel has participated in the
preparation of the Registration Statement and the Prospectus and in
conferences with officers and other representatives of the Company,
representatives of the independent auditors of the Company and
representatives of the Underwriters at which conferences the contents
of the Registration Statements and the Prospectus and related matters
were discussed. Such counsel may also state that because the purpose
of their professional engagement was not to establish or confirm
factual matters and because the scope of their examination of the
affairs of the Company did not permit them to verify the accuracy,
completeness or fairness of the statements contained in the
Registration Statement or Prospectus, they are not passing upon and do
not assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement or
Prospectus, except to the extent set forth in the last sentence of
this paragraph. Such counsel also shall state that, on the basis of
the foregoing except for the financial statements and schedules and
other financial data included therein and the Form T-1, as to which
such counsel need express no opinion or belief (a) such counsel is of
the opinion that the Registration Statement at the time it became
effective complied as to form in al material respects with the
relevant requirements of the Act and the Rules and Regulations and (b)
nothing has come to such counsel's attention that would lead such
counsel to believe that the Registration Statement at the time it
became effective contained any 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 or that the
Prospectus or any amendment or supplement thereto, as of its date and
as of the date of such opinion, contained or contains any untrue
statement of a material fact or omitted or omits to state any material
fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading. Such
counsel shall also state that, insofar as the statements contained in
the Registration Statement and the Prospectus under the caption
"Description of Notes" constitute a summary of documents and legal
matters referred to therein, such statements are accurate in all
material respects.
In rendering such opinion, such counsel may rely as to matters of
fact, to the extent such counsel deems proper, on certificates of
responsible officers of the Company and public officials.
(f) The Underwriters shall have received from Xxxxxx Xxxxxx & Xxxxxxx,
counsel for the Underwriters, such opinion or opinions, dated the Closing
Date, with respect to the validity of the Securities delivered on the
Closing Date, the Registration Statements, the Prospectus and other related
matters as the Underwriters may require, and the Company shall have
furnished to such counsel such documents as they reasonably request for the
purpose of enabling them to pass upon such matters.
(g) The Underwriters shall have received a certificate, dated the
Closing Date, of the President or any Vice President and a principal
financial or accounting officer of the Company in which such officers, to
the best of their knowledge after reasonable investigation, shall state
that: the representations and warranties of the Company in this Agreement
are true and correct; the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied hereunder
at or prior to the Closing Date; no stop order suspending the effectiveness
of any Registration Statement has been issued and no proceedings for that
purpose have been instituted or are contemplated by the Commission; the
Additional Registration Statement (if any) satisfying the requirements of
subparagraphs (1) and (3) of Rule 462(b) was filed pursuant to Rule 462(b),
including payment of the applicable filing fee in accordance with Rule
111(a) or (b) under
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the Act, prior to the time the Prospectus was printed and distributed to
any Underwriter; and, subsequent to the date of the most recent financial
statements in the Prospectus, there has been no material adverse change,
nor any development or event involving a prospective material adverse
change, in the condition (financial or other), business, properties or
results of operations of the Company except as set forth in or contemplated
by the Prospectus or as described in such certificate.
(h) The Underwriters shall have received a letter, dated such Closing
Date, of Price Waterhouse LLP which meets the requirements of subsection
(a) of this Section, except that the specified date referred to in such
subsection will be a date not more than three days prior to the Closing
Date for the purposes of this subsection.
(i) The Underwriters shall have received a true and correct copy of
the New Credit Facility, dated the Closing Date, and there shall have been
no material amendments, alterations, modifications or waivers of any
provisions of the New Credit Facility, and there exists on and as of the
Closing Date (after giving effect to the transactions contemplated by this
Agreement) no condition that would constitute a Default or an Event of
Default (each as defined in the New Credit Facility) under the New Credit
Facility.
(j) The Indenture shall have been duly executed and delivered by the
Company and the Trustee, and the Securities shall have been duly executed
and delivered by the Company and duly authenticated by the Trustee.
(k) On or prior to the Closing Date, the Underwriters shall have
received an opinion from Xxxxxxxx Xxxxx, Xxxxxx & Xxxxx, in form and
substance satisfactory to the Underwriters, regarding the solvency of the
Company.
(l) On or prior to the Closing Date, of the Company shall have
consummated each element of the Recapitalization as described in the
Prospectus.
(m) On the Closing Date, counsel for the Underwriters shall have been
furnished and documents as they may reasonably require in order to evidence
the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all opinions
and certificates mentioned above or elsewhere in this Agreement shall be
reasonably satisfactory in form and substance to the Underwriters and
counsel for the Underwriters.
The Company will furnish the Underwriters with such conformed copies of such
opinions, certificates, letters and documents as the Underwriters reasonably
request. CSFBC may in its sole discretion waive on behalf of the Underwriters
compliance with any conditions to the obligations of the Underwriters hereunder.
7. Indemnification and Contribution. (a) The Company will indemnify and
hold harmless each Underwriter against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
any Registration Statement, the Prospectus, or any amendment or supplement
thereto, or any related preliminary prospectus, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
and will reimburse such Underwriter for any legal or other expenses reasonably
incurred by such Underwriter in connection with investigating or defending any
such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that the Company will not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of or is
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based upon an untrue statement or alleged untrue statement in or omission or
alleged omission from any of such documents in reliance upon and in conformity
with written information furnished to the Company by any Underwriter through
CSFBC specifically for use therein, it being understood and agreed that the only
such information furnished by any Underwriter consists of the information
described as such in subsection (b) below and, provided, further, that as to any
preliminary prospectus, this Section 7(a) shall not inure to the benefit of any
Underwriter on account of any loss, claim, damage, liability or action from the
sale of the Securities, if that Underwriter failed to send or give a copy of the
Prospectus, as the same may be amended or supplemented, to that person if
required under the Act, and the untrue statement or alleged untrue statement or
omission or alleged omission in such preliminary prospectus was connected to the
Prospectus, unless, in either case, such failure to deliver the Prospectus was a
result of noncompliance by the Company with Section 5(c).
(b) Each Underwriter will severally and not jointly indemnify and hold
harmless the Company against any losses, claims, damages or liabilities, joint
or several, to which the Company may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in any Registration Statement, the
Prospectus, or any amendment or supplement thereto, or any related preliminary
prospectus, or arise out of or are based upon the omission or the alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by such Underwriter
through CSFBC specifically for use therein, and will reimburse any legal or
other expenses reasonably incurred by the Company in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred, it being understood and agreed that the only such
information furnished by any Underwriter consists of the following information
in the Prospectus furnished on behalf of each Underwriter: the last paragraph at
the bottom of the cover page concerning the terms of the offering by the
Underwriters, the legend concerning over-allotments, stabilizing transactions,
syndicate short covering transactions and penalty bids on the inside front cover
page, the third paragraph under the caption "Underwriting" and the last two
paragraphs under the caption "Underwriting."
(c) Promptly after receipt by an indemnified party under this Section of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
subsection (a) or (b) above, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party otherwise than
under subsection (a) or (b) above. In case any such action is brought against
any indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein and, to
the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel reasonably satisfactory to
such indemnified party (who shall not, except with the consent of the
indemnified party, be counsel to the indemnifying party), and after notice from
the indemnifying party to such indemnified party of its election so to assume
the defense thereof, the indemnifying party will not be liable to such
indemnified party under this Section for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened action in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party unless such settlement includes an
unconditional release of such indemnified party from all liability on any claims
that are the subject matter of such action. No indemnifying party shall be
liable for any settlement of any such claim or actin effected without its
written consent (which consent shall not be unreasonably withheld).
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(d) If the indemnification provided for in this Section is unavailable or
insufficient to hold harmless an indemnified party under subsection (a) or (b)
above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities referred to in subsection (a) or (b) above (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company on the
one hand and the Underwriters on the other 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 Company on the one hand and the Underwriters on the other in connection with
the statements or omissions which resulted in such losses, claims, damages or
liabilities as well as any other relevant equitable considerations. The relative
benefits received by the Company on the one hand and the Underwriters on the
other shall be deemed to be in the same proportion as the total net proceeds
from the offering (before deducting expenses) received by the Company bear to
the total underwriting discounts and commissions received by the Underwriters.
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission. The amount paid by an indemnified party as a
result of the losses, claims, damages or liabilities referred to in the first
sentence of this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any action or claim which is the subject of this
subsection (d). Notwithstanding the provisions of this subsection (d), no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations in
this subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) The obligations of the Company under this Section shall be in addition
to any liability which the Company may otherwise have and shall extend, upon the
same terms and conditions, to each person, if any, who controls any Underwriter
within the meaning of the Act; and the obligations of the Underwriters under
this Section shall be in addition to any liability which the respective
Underwriters may otherwise have and shall extend, upon the same terms and
conditions, to each director of the Company, to each officer of the Company who
has signed a Registration Statement and to each person, if any, who controls the
Company within the meaning of the Act.
8. Default of Underwriter. If any Underwriter or Underwriters default in
their obligations to purchase Securities hereunder on the Closing Date and the
aggregate principal amount of Securities that such defaulting Underwriter or
Underwriters agreed but failed to purchase does not exceed 10% of the total
principal amount of Securities that the Underwriters are obligated to purchase
on the Closing Date, CSFBC may make arrangements satisfactory to the Company for
the purchase of such Securities by other persons, including any of the
Underwriters, but if no such arrangements are made by the Closing Date, the
non-defaulting Underwriters shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the Securities that such
defaulting Underwriters agreed but failed to purchase on the Closing Date. If
any Underwriter or Underwriters so default and the aggregate principal amount of
Securities with respect to which such default or defaults occur exceeds 10% of
the total principal amount of Securities that the Underwriters are obligated to
purchase on such Closing Date and arrangements satisfactory to CSFBC and the
Company for the purchase of such Securities by other persons are not made within
36 hours after such default, this Agreement will terminate without liability on
the part of any non-
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defaulting Underwriter or the Company, except as provided in Section 9. As used
in this Agreement, the term "Underwriter" includes any person substituted for an
Underwriter under this Section. Nothing herein will relieve a defaulting
Underwriter from liability for its default. The Company shall not be obligated
to deliver any of the Securities except upon payment for all the Securities to
be purchased as provided herein.
9. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Company or its officers and of the several Underwriters set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation, or statement as to the results thereof, made by or on behalf
of any Underwriter, the Company or any of their respective Underwriters,
officers or directors or any controlling person, and will survive delivery of
and payment for the Securities. If this Agreement is terminated pursuant to
Section 8 or if for any reason the purchase of the Securities by the
Underwriters is not consummated, the Company shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Section 5 and the respective
obligations of the Company and the Underwriters pursuant to Section 7 shall
remain in effect, and if any Securities have been purchased hereunder the
representations and warranties in Section 2 and all obligations under Section 5
shall also remain in effect. If the purchase of the Securities by the
Underwriters is not consummated for any reason other than solely because of the
termination of this Agreement pursuant to Section 8 or the occurrence of any
event specified in clause (iii), (iv) or (v) of Section 6(d), the Company will
reimburse the Underwriters for all out-of-pocket expenses (including fees and
disbursements of counsel) reasonably incurred by them in connection with the
offering of the Securities.
10. Notices. All communications hereunder will be in writing and, if sent
to the Underwriters, will be mailed, delivered, faxed or telegraphed and
confirmed to the Underwriters, c/o Credit Suisse First Boston Corporation,
Xxxxxx Xxxxxxx Xxxxxx, Xxx Xxxx, X.X. 10010-3629, Attention: Investment Banking
Department Transactions Advisory Group, or, if sent to the Company, will be
mailed, delivered or telegraphed and confirmed to it at Xxx Xxxxxxx Xxxxxx,
Xxxxx 000, 0000 XXX Xxxxxxx, Xxxxxx, Xxxxx 00000, Attention: Chief Executive
Officer. The Company shall be entitled to act and rely upon any request,
consent, notice or agreement given or made on behalf of the Underwriters by
CSFBC.
11. Successors. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective successors and the officers and
directors and controlling persons referred to in Section 7, and no other person
will have any right or obligation hereunder.
12. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
13. Applicable Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York, without regard to principles
of conflicts of laws.
The Company hereby submits to the non-exclusive jurisdiction of the Federal
and state courts in the Borough of Manhattan in The City of New York in any suit
or proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby.
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If the foregoing is in accordance with the Underwriters' understanding of
our agreement, kindly sign and return to the Company one of the counterparts
hereof, whereupon it will become a binding agreement between the Company and the
Underwriters in accordance with its terms.
Very truly yours,
CHIEF AUTO PARTS INC.
By__________________________
Name:
Title:
The foregoing Underwriting Agreement
is hereby confirmed and accepted as
of the date first above written.
CREDIT SUISSE FIRST BOSTON CORPORATION
By: ___________________________________
Name:
Title:
SALOMON BROTHERS INC
By: ___________________________________
Name:
Title:
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SCHEDULE A
Principal Amount
Underwriter of Securities
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Credit Suisse First Boston Corporation $
Salomon Brothers Inc
-----------
$130,000,000
------------
20
