Exhibit 1.2
CONFORMED COPY
WORLD COLOR PRESS, INC.
$300,000,000
7 3/4 % Senior Subordinated Notes due 2009
PURCHASE AGREEMENT
February 16, 1999
XXXXXX XXXXXXX & CO. INCORPORATED
ABN AMRO INCORPORATED
BANCBOSTON XXXXXXXXX XXXXXXXX INC.
CIBC XXXXXXXXXXX CORP.
FLEET SECURITIES INC.
$300,000,000
7 3/4 % Senior Subordinated Notes due 2009
of WORLD COLOR PRESS, INC.
PURCHASE AGREEMENT
February 16, 1999
Xxxxxx Xxxxxxx & Co. Incorporated
ABN AMRO Incorporated
BancBoston Xxxxxxxxx Xxxxxxxx Inc.
CIBC Xxxxxxxxxxx Corp.
Fleet Securities Inc.
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
World Color Press, Inc. (the "COMPANY"), a Delaware corporation,
proposes to issue and sell to Xxxxxx Xxxxxxx & Co. Incorporated, ABN AMRO
Incorporated, BancBoston Xxxxxxxxx Xxxxxxxx Inc., CIBC Xxxxxxxxxxx Corp. and
Fleet Securities Inc. (each an "INITIAL PURCHASER" and, collectively, the
"INITIAL PURCHASERS") an aggregate of $300,000,000 in principal amount of its
73/4% Senior Subordinated Notes due 2009 (the "SERIES A NOTES"), subject to the
terms and conditions set forth herein. The Series A Notes are to be issued
pursuant to the provisions of an indenture (the "INDENTURE"), to be dated as of
the Closing Date (as defined below), among the Company and Bank of New York, as
trustee thereunder (the "TRUSTEE"). The Series A Notes and the Series B Notes
(as defined below) issuable in exchange therefor are collectively referred to
herein as the "NOTES." The Notes will have the terms and conditions set forth
in Exhibit A hereto.
1. OFFERING MEMORANDUM. The Series A Notes will be offered and sold to
the Initial Purchasers pursuant to one or more exemptions from the registration
requirements under the Securities Act of 1933, as amended (the "ACT"). The
Company
will prepare an offering memorandum relating to the Series A Notes. Such
offering memorandum (including material incorporated therein by reference) is
hereinafter referred to as the "OFFERING MEMORANDUM."
Upon original issuance thereof, and until such time as the same is no
longer required pursuant to the Indenture, the Series A Notes (and all
securities (other than the Series B Notes) issued in exchange therefor, in
substitution thereof or upon conversion thereof) shall bear the following
legend:
"THIS NOTE (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT
OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS
ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER (1)
REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT)(A "QIB"), (B) IT IS ACQUIRING THIS NOTE
IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE
SECURITIES ACT), (C) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS
DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D UNDER THE
SECURITIES ACT (AN "IAI"), OR (D) IT HAS OTHERWISE ACQUIRED THIS NOTE OR A
BENEFICIAL INTEREST HEREIN IN ACCORDANCE WITH THE TERMS OF THE INDENTURE
RELATING TO THIS NOTE AND IN COMPLIANCE WITH APPLICABLE SECURITIES LAWS,
(2) AGREES THAT IT WILL NOT, WITHIN THE TIME PERIOD REFERRED TO UNDER RULE
144(k) (TAKING INTO ACCOUNT THE PROVISIONS OF RULE 144(d) UNDER THE
SECURITIES ACT, IF APPLICABLE) UNDER THE SECURITIES ACT AS IN EFFECT ON THE
DATE OF THE TRANSFER OF THIS NOTE, RESELL OR OTHERWISE TRANSFER THIS NOTE
EXCEPT (A) TO THE COMPANY, (B) TO A PERSON WHOM THE SELLER REASONABLY
BELIEVES IS A QIB PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QIB IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C) OUTSIDE THE
UNITED STATES IN AN OFFSHORE TRANSACTION MEETING THE REQUIREMENTS OF RULE
903 OR 904 UNDER THE SECURITIES ACT, (D) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144 UNDER THE SECURI-
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TIES ACT (IF AVAILABLE), (E) TO AN IAI THAT, PRIOR TO SUCH TRANSFER,
FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS
AND AGREEMENTS RELATING TO THE TRANSFER OF THIS NOTE (THE FORM OF WHICH CAN
BE OBTAINED FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN
AGGREGATE PRINCIPAL AMOUNT OF NOTES LESS THAN $250,000, AN OPINION OF
COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH
THE SECURITIES ACT, (F) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION
OF COUNSEL ACCEPTABLE TO THE COMPANY) OR (G) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND, IN EACH CASE, IN
ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES OR ANY OTHER APPLICABLE JURISDICTION AND (3) AGREES THAT IT WILL
DELIVER TO EACH PERSON TO WHOM THIS NOTE OR AN INTEREST HEREIN IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. AS USED
HEREIN, THE TERMS "OFFSHORE TRANSACTION", "UNITED STATES" AND "U.S. PERSON"
HAVE THE MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE
SECURITIES ACT. THE INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE
TO REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE
FOREGOING RESTRICTIONS."
2. AGREEMENTS TO SELL AND PURCHASE. On the basis of the representations,
warranties and covenants contained in this Agreement, and subject to the terms
and conditions contained herein, the Company agrees to issue and sell to the
Initial Purchasers, and the Initial Purchasers agree, severally and not jointly,
to purchase from the Company, the principal amount of Series A Notes set forth
opposite the name of such Initial Purchaser on Schedule A hereto at a purchase
price equal to 98.15% of the principal amount thereof (the "PURCHASE PRICE").
3. TERMS OF OFFERING. The Initial Purchasers have advised the Company
that the Initial Purchasers will make offers (the "EXEMPT RESALES") of the
Series A Notes purchased hereunder on the terms set forth in the Offering
Memorandum, as amended or supplemented, solely to (i) persons whom the Initial
Purchasers reasonably believe to be "qualified institutional buyers" as defined
in Rule 144A under the Act ("QIBS") or (ii) persons permitted to purchase the
Series A Notes in offshore
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transactions in reliance upon Regulation S under the Act (each, a "REGULATION S
PURCHASER") (such persons specified in clauses (i) and (ii) being referred to
herein as the "ELIGIBLE PURCHASERS"). The Initial Purchasers will offer the
Series A Notes to Eligible Purchasers initially at a price equal to 100% of the
principal amount thereof. Such price may be changed at any time without notice.
Holders (including subsequent transferees) of the Series A Notes will
have registration rights set forth in the registration rights agreement (the
"REGISTRATION RIGHTS AGREEMENT"), to be dated the Closing Date (as defined
below), in substantially the form of Exhibit B hereto, for so long as such
Series A Notes constitute "Transfer Restricted Securities" (as defined in the
Registration Rights Agreement). Pursuant to the Registration Rights Agreement,
the Company will agree to file with the Securities and Exchange Commission (the
"COMMISSION"), under the circumstances set forth therein, (i) a registration
statement under the Act (the "EXCHANGE OFFER REGISTRATION STATEMENT") relating
to the Company's 7 3/4 % Series B Senior Subordinated Notes due 2009 (the
"SERIES B NOTES"), to be offered in exchange for the Series A Notes (such offer
to exchange being referred to as the "EXCHANGE OFFER") and (ii) a shelf
registration statement pursuant to Rule 415 under the Act (the "SHELF
REGISTRATION STATEMENT" and, together with the Exchange Offer Registration
Statement, the "REGISTRATION STATEMENTS") relating to the resale by certain
holders of the Series A Notes and use its best efforts to cause such
Registration Statements to be declared and remain effective and usable for the
periods specified in the Registration Rights Agreement and to consummate the
Exchange Offer. This Agreement, the Indenture, the Notes and the Registration
Rights Agreement are hereinafter sometimes referred to collectively as the
"OPERATIVE DOCUMENTS."
4. DELIVERY AND PAYMENT.
(1) Delivery of, and payment of the Purchase Price for, the Series A
Notes shall be made at the office of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP at
000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000-0000, or such other location as may
be mutually acceptable. Such delivery and payment shall be made at 9:00 a.m.,
New York City time, on February 23, 1999, or at such other time as shall be
agreed upon by the Initial Purchasers and the Company. The time and date of
such delivery and payment are herein called the "CLOSING DATE."
(2) One or more of the Series A Notes in definitive global form,
registered in the name of Cede & Co., as nominee of the Depository Trust Company
("DTC"), having an aggregate principal amount corresponding to the
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aggregate principal amount of the Series A Notes (collectively, the "GLOBAL
NOTES") shall be delivered by the Company to the Initial Purchasers (or as the
Initial Purchasers direct) in each case with any transfer taxes thereon duly
paid by the Company against payment by the Initial Purchasers of the Purchase
Price thereof by wire transfer in same day funds to the order of the Company.
The Global Note shall be made available to the Initial Purchasers for inspection
not later than 9:30 a.m., New York City time, on the business day immediately
preceding the Closing Date.
5. AGREEMENTS OF THE COMPANY. The Company hereby agrees with each
Initial Purchaser as follows:
(1) To advise the Initial Purchasers promptly and, if requested by an
Initial Purchaser, confirm such advice in writing, (i) of the issuance by any
state securities commission of any stop order suspending the qualification or
exemption from qualification of any Series A Notes for offering or sale in any
jurisdiction designated by an Initial Purchaser pursuant to Section 5(e) hereof,
or the initiation of any proceeding by any state securities commission or any
other federal or state regulatory authority for such purpose and (ii) of the
happening of any event during the period referred to in Section 5(d) hereof that
makes any statement of a material fact made in the Offering Memorandum untrue or
that requires any additions to or changes in the Offering Memorandum in order to
make the statements therein, in the light of the circumstances under which they
are made, not misleading. The Company shall use its reasonable efforts to
prevent the issuance of any stop order or order suspending the qualification or
exemption of any Series A Notes under any state securities or Blue Sky laws and,
if at any time any state securities commission or other federal or state
regulatory authority shall issue an order suspending the qualification or
exemption of any Series A Notes under any state securities or Blue Sky laws, the
Company shall use its reasonable efforts to obtain the withdrawal or lifting of
such order at the earliest practicable time.
(2) To furnish the Initial Purchasers and those persons identified by
the Initial Purchasers to the Company, without charge, as many copies of the
Offering Memorandum, and any amendments or supplements thereto, as the Initial
Purchasers may reasonably request. Subject to the Initial Purchasers'
compliance with their representations and warranties and agreements set forth in
Section 7 hereof, the Company consents to the use of the Offering Memorandum,
and any amendments and supplements thereto required pursuant hereto, by the
Initial Purchasers in connection with Exempt Resales.
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(3) During the period referred to in Section 5(d) hereof, (i) not to
make any amendment or supplement to the Offering Memorandum of which the Initial
Purchasers shall not previously have been advised or to which the Initial
Purchasers shall reasonably object after being so advised; PROVIDED, HOWEVER,
that notwithstanding the Initial Purchasers' objection such amendment or
supplement may be effected if counsel to the Company reasonably determines that
the Company would be adversely affected if such amendment or supplement is not
effected; and (ii) to prepare promptly upon the Initial Purchasers' reasonable
request, any amendment or supplement to the Offering Memorandum which may be
necessary or advisable in connection with Exempt Resales.
(4) If, after the date hereof during such period as in the opinion of
counsel for the Initial Purchasers an Offering Memorandum is required by law to
be delivered in connection with Exempt Resales by the Initial Purchasers, which
period shall end no later than the earlier of (i) the date on which the Initial
Purchasers' distribution of the Notes is complete or (ii) the date on which a
shelf registration statement for the benefit of the Initial Purchasers becomes
effective pursuant to the Registration Rights Agreement, any event shall occur
or condition exist as a result of which it becomes necessary to amend or
supplement the Offering Memorandum in order to make the statements therein, in
the light of the circumstances when such Offering Memorandum is delivered to an
Eligible Purchaser, not misleading, or if, in the opinion of counsel to the
Initial Purchasers, it is necessary to amend or supplement the Offering
Memorandum to comply with applicable law, forthwith to prepare an appropriate
amendment or supplement to such Offering Memorandum so that the statements
therein, as so amended or supplemented, will not, in the light of the
circumstances when it is so delivered, be misleading, or so that such Offering
Memorandum will comply with applicable law, and to furnish to the Initial
Purchasers and such other persons as the Initial Purchasers may designate such
number of copies thereof as the Initial Purchasers may reasonably request.
(5) Prior to the sale of the Series A Notes pursuant to Exempt
Resales as contemplated hereby, to cooperate with the Initial Purchasers and
counsel to the Initial Purchasers in connection with the registration or
qualification of the Series A Notes for offer and sale to the Initial Purchasers
and pursuant to Exempt Resales under the securities or Blue Sky laws of such
jurisdictions as the Initial Purchasers may request and to continue such
qualification in effect so long as required for Exempt Resales and to file such
consents to service of process or other documents as may be necessary in order
to effect such registration or qualification; PROVIDED, HOWEVER, that the
Company shall not be required in connection therewith to register or qualify as
a
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foreign corporation in any jurisdiction in which it is not now so qualified or
to take any action that would subject it to general consent to service of
process or taxation in any jurisdiction in which it is not now so subject.
(6) So long as the Notes are outstanding, to promptly furnish to the
Initial Purchasers a copy of its annual report to stockholders for such year;
and to promptly furnish to the Initial Purchasers a copy of each report and any
definitive proxy statement of the Company filed with the Commission under the
Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), or mailed to
stockholders.
(7) During the period of two years after the Closing Date, without
the prior written consent of Xxxxxx Xxxxxxx & Co. Incorporated, not to, and not
to permit any of its affiliates (as defined in Rule 144 under the Act) to,
resell any of the Notes that have been reacquired by any of them, except for
sales of Notes purchased by the Company or any of its affiliates and resold in
transactions registered under the Securities Act.
(8) Whether or not the transactions contemplated in this Agreement
are consummated or this Agreement is terminated, to pay or cause to be paid all
expenses incident to performance of the obligations of the Company under this
Agreement including: (i) the fees, disbursements and expenses of counsel to the
Company and accountants of the Company in connection with the sale and delivery
of the Series A Notes to the Initial Purchasers and pursuant to Exempt Resales,
and all other fees or expenses in connection with the preparation, printing,
filing and distribution of the Offering Memorandum and all amendments and
supplements thereto (including financial statements) prior to or during the
period specified in Section 5(d) hereof, including the mailing and delivering of
copies thereof to the Initial Purchasers and persons designated by them as
specified herein, (ii) all costs and expenses related to the transfer and
delivery of the Series A Notes to the Initial Purchasers and pursuant to Exempt
Resales, including any transfer or other taxes payable thereon, (iii) all costs
of printing or producing this Agreement, the other Operative Documents and any
other agreements or documents in connection with the offering, purchase, sale or
delivery of the Series A Notes, (iv) all expenses in connection with the
registration or qualification of the Series A Notes for offer and sale under the
securities or Blue Sky laws of the several states and all costs of printing or
producing any preliminary and supplemental Blue Sky memoranda in connection
therewith (including the reasonable filing fees and fees and disbursements of
counsel for the Initial Purchasers in connection with such registration or
qualification and memoranda relating thereto), (v) the cost of printing
certificates representing the Series A Notes, (vi) all expenses and listing fees
in
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connection with the application for quotation of the Series A Notes in the
National Association of Securities Dealers, Inc. ("NASD") Automated Quotation
System - PORTAL ("PORTAL"), (vii) the fees and expenses of the Trustee and
Trustee's counsel in connection with the Indenture and the Notes, (viii) the
costs and charges of any transfer agent, registrar and/or depositary (including
DTC), (ix) any fees charged by rating agencies for the rating of the Notes, (x)
all costs and expenses of the Exchange Offer and any Registration Statement, as
set forth in the Registration Rights Agreement, and (xii) all other costs and
expenses incident to the performance of the obligations of the Company hereunder
for which provision is not otherwise made in this Section 5.
(9) To use its reasonable best efforts to assist the Initial
Purchasers in effecting the inclusion of the Series A Notes in PORTAL and to
maintain the listing of the Series A Notes on PORTAL for so long as the Series A
Notes are outstanding.
(10) To obtain the approval of DTC for "book-entry" transfer of the
Notes, and to comply with all of its agreements set forth in the representation
letters of the Company to DTC relating to the approval of the Notes by DTC for
"book entry" transfer.
(11) During the period beginning on the date hereof and continuing to
and including the Closing Date, not to offer, sell, contract to sell or
otherwise transfer or dispose of any debt securities of the Company or any
warrants, rights or options to purchase or otherwise acquire debt securities of
the Company substantially similar to the Notes (other than (i) the Notes and
(ii) commercial paper issued in the ordinary course of business), without the
prior written consent of the Initial Purchasers.
(12) Not to sell, offer for sale or solicit offers to buy or otherwise
negotiate in respect of any security (as defined in the Act) that would be
integrated with the sale of the Series A Notes to the Initial Purchasers or
pursuant to Exempt Resales in a manner that would require the registration of
any such sale of the Series A Notes under the Act.
(13) Not to voluntarily claim, and to actively resist any attempts to
claim, the benefit of any usury laws against the holders of any Notes.
(14) To comply with all of its agreements set forth in the
Registration Rights Agreement.
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(15) To use its best efforts to do and perform all things required or
necessary to be done and performed under this Agreement by it prior to the
Closing Date and to satisfy all conditions precedent to the delivery of the
Series A Notes.
6. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. As of the date hereof,
the Company represents and warrants to each Initial Purchaser that:
(1) The Offering Memorandum will not, and any supplement or amendment
thereto will not, at the date of the Offering Memorandum and at the date of such
supplements or amendments, contain 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, in the light of the circumstances under which they
were made, not misleading, except that the representations and warranties
contained in this paragraph (a) shall not apply to statements in or omissions
from the Offering Memorandum (or any supplement or amendment thereto) made in
reliance upon and in conformity with information relating to the Initial
Purchasers furnished to the Company in writing by the Initial Purchasers or on
their behalf with their consent expressly for use therein. No stop order
preventing the use of the Offering Memorandum, or any amendment or supplement
thereto, or any order asserting that any of the transactions contemplated by
this Agreement are subject to the registration requirements of the Act, has been
issued.
(2) Except as disclosed in the Offering Memorandum, the Company's
Annual Report on Form 10-K most recently filed with the Commission and all
subsequent reports which have been filed by the Company with the Commission or
sent to the stockholders pursuant to the Exchange Act did not include, as of
their respective dates, any 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. Such documents, when
they were filed with the Commission, conformed in all material respects to the
requirements of the Exchange Act and the rules and regulations of the Commission
thereunder.
(3) The Company and each of the Company's "significant subsidiaries"
as such term is defined in Rule 1-02 of Regulation S-X under the Act (each a
"Subsidiary" and collectively, the "Subsidiaries") has been duly organized, is
validly existing in good standing under the laws of its jurisdiction of
formation and has the requisite corporate power and authority to carry on its
business as described in the Offering Memorandum and to own, lease and operate
its properties, and each is duly
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qualified and is in good standing as a foreign entity authorized to do business
in each jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except where the failure to be
so qualified would not have a material adverse effect on the business, results
of operations or condition (financial or otherwise) of the Company and its
subsidiaries taken as a whole (a "MATERIAL ADVERSE EFFECT").
(4) All of the issued and outstanding shares of capital stock of, or
other ownership interests in, each Subsidiary have been duly and validly
authorized and issued, and, as of the Closing Date, all of the shares of capital
stock of, or other ownership interests in, each Subsidiary will be owned of
record by the Company, either directly or indirectly through one or more of its
subsidiaries, free and clear of any security interest, mortgage, pledge, claim,
lien or encumbrance (each, a "Lien") other than (i) as created by the Second
Amended and Restated Credit Agreement dated as of June 6, 1997 among the
Company, the Lenders party thereto and Bankers Trust Company, as agent, as
amended, and (ii) such other Liens as are not, individually or in the aggregate,
material to the Company and its subsidiaries, taken as a whole. All such shares
of capital stock are fully paid and nonassessable and, on the Closing Date, will
be fully paid and nonassessable. On the Closing Date, there will be no
outstanding subscriptions, rights, warrants, options, calls, convertible
securities or commitments of sale related to or entitling any person to purchase
or otherwise to acquire any shares of the capital stock of, or other ownership
interest in, any Subsidiary.
(5) All outstanding shares of capital stock of the Company have been
duly authorized and validly issued and are fully paid, non-assessable and were
not issued in violation of any preemptive or similar rights.
(6) This Agreement has been duly authorized, executed and delivered
by the Company.
(7) The Indenture has been duly authorized by the Company and, on the
Closing Date, will have been validly executed and delivered by the Company.
When the Indenture has been duly executed and delivered by the Company, the
Indenture will be a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms (assuming the due execution and
delivery of the Indenture by the Trustee), subject to applicable bankruptcy,
insolvency and similar laws affecting creditors' rights generally and general
principles of equity.
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(8) The Series A Notes have been duly authorized and, on the Closing
Date, will have been validly executed and delivered by the Company. When the
Series A Notes have been issued, executed and authenticated in accordance with
the provisions of the Indenture and delivered to and paid for by the Initial
Purchasers in accordance with the terms of this Agreement, the Series A Notes
will be entitled to the benefits of the Indenture and will be valid and binding
obligations of the Company, enforceable in accordance with their terms, subject
to applicable bankruptcy, insolvency and similar laws affecting creditors'
rights generally and general principles of equity. On the Closing Date, the
Series A Notes will conform in all material respects as to legal matters to the
description thereof contained in the Offering Memorandum.
(9) On the Closing Date, the Series B Notes will have been duly
authorized by the Company. When the Series B Notes are issued, executed and
authenticated in accordance with the terms of the Exchange Offer and the
Indenture, the Series B Notes will be entitled to the benefits of the Indenture
and will be valid and binding obligations of the Company, enforceable against
the Company in accordance with their terms, subject to applicable bankruptcy,
insolvency and similar laws affecting creditors' rights generally and general
principles of equity.
(10) The Registration Rights Agreement has been duly authorized by the
Company and, on the Closing Date, will have been duly executed and delivered by
the Company. When the Registration Rights Agreement has been duly executed and
delivered, the Registration Rights Agreement will be a valid and binding
agreement of the Company, enforceable against the Company in accordance with its
terms, subject to applicable bankruptcy, insolvency and similar laws affecting
creditors' rights generally and general principles of equity. On the Closing
Date, the Registration Rights Agreement will conform in all material respects as
to legal matters to the description thereof contained in the Offering
Memorandum.
(11) Neither the Company nor any of its Subsidiaries is (a) in
violation of its respective charter or by-laws or (b) in default in the
performance of any obligation, agreement or condition contained in any bond,
debenture, note or any other evidence of indebtedness or in any other agreement,
indenture or instrument, to which the Company or any of its Subsidiaries is a
party or by which the Company or any of its Subsidiaries or their respective
properties is bound except, with respect to defaults referred to in clause (b),
such as would not, singly or in the aggregate, have a Material Adverse Effect,
nor has any event occurred which with notice or lapse of time or both would
constitute such a violation or default.
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(12) The execution, delivery and performance of this Agreement, the
Indenture, the Series A Notes, the Series B Notes and the Registration Rights
Agreement by the Company and compliance by the Company with all provisions
hereof and thereof and the consummation of the transactions contemplated hereby
and thereby will not require any consent, approval, authorization or other order
of, or qualification with, any court or governmental body or agency (except such
as may be required under the securities or Blue Sky laws of the various states),
except for consents, approvals, authorizations or orders which would not, singly
or in the aggregate, have a Material Adverse Effect and would not materially and
adversely affect the consummation of this Agreement, the Registration Rights
Agreement, the Indenture or the transactions contemplated hereby and thereby,
and will not conflict with or constitute a breach of any of the terms or
provisions of, or a default under, the charter, by-laws or other organizational
documents, as the case may be, of the Company or any of its Subsidiaries or any
indenture, loan agreement, mortgage, lease or other agreement or instrument that
is material to the Company to which the Company or any of its Subsidiaries is a
party or by which the Company or any of its Subsidiaries or their respective
property is bound, or violate or conflict with any applicable law or any rule,
regulation, judgment, order or decree of any court or any governmental body or
agency having jurisdiction over the Company, any of its Subsidiaries or their
respective property, except for such conflicts, violations or breaches which
would not, singly or in the aggregate, have a Material Adverse Effect and would
not materially and adversely affect the consummation of this Agreement, the
Registration Rights Agreement, the Indenture or the transactions contemplated
hereby and thereby, and except for such conflicts, violations or breaches as to
which the Company has obtained the necessary consents or waivers.
(13) Other than as described in the Offering Memorandum, there is no
action, suit or proceeding before or by any court or governmental agency or
body, domestic or foreign, pending against the Company or any of its
Subsidiaries or any of their respective properties which could reasonably be
expected to have, singly or in the aggregate, a Material Adverse Effect or which
might materially and adversely affect the consummation of this Agreement, the
Registration Rights Agreement, the Indenture or the transactions contemplated
hereby and thereby, and, to the Company's knowledge, no such proceedings are
threatened.
(14) No action has been taken and no statute, rule or regulation or
order has been enacted, adopted or issued by any governmental agency or body
which prevents the execution, delivery and performance of any of the Operative
Documents, the issuance of the Series A Notes, or suspends the sale of the
Series A
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Notes in any jurisdiction referred to in Section 5(e) hereof; and no injunction,
restraining order or other relief of any nature by a federal or state court or
other tribunal of competent jurisdiction has been issued with respect to the
Company which would prevent or suspend the issuance or sale of the Series A
Notes in any jurisdiction referred to in Section 5(e) hereof.
(15) Except as disclosed in the Offering Memorandum or as would not,
singly or in the aggregate, have a Material Adverse Effect: (i) the Company and
each of the Subsidiaries is in compliance with all laws and regulations relating
to protection of human health or environment or imposing liability or standards
of conduct concerning any Materials of Environmental Concern (as defined below)
("ENVIRONMENTAL LAWS") applicable to it, including, without limitation,
possession of required permits and compliance with the terms and conditions
thereof, and there are no circumstances known to the Company that will prevent
such compliance in the future; (ii) neither the Company nor any of the
Subsidiaries has received any written notice, and there is no pending or, to the
Company's knowledge, threatened action, suit or proceeding before or by any
court or governmental agency or body ("ENVIRONMENTAL CLAIM"), alleging potential
liability (including, but not limited to, investigatory, cleanup or governmental
response costs, natural resources or property damages, personal injuries, or
penalties) of the Company or any of the Subsidiaries or any person or entity for
whom the Company or any of the Subsidiaries has contractually retained or
assumed responsibility, arising out of, based on, or resulting from the
presence, or release, discharge, emission or disposal into the environment, of
any Materials of Environmental Concern at or from any location, owned or
operated by the Company or any of the Subsidiaries, as the case may be, or any
violation or alleged violation of any Environmental Law; and (iii) there are no
past or present actions, activities, conditions, events or incidents that could
be reasonably expected to form the basis of any such Environmental Claim; the
term "MATERIALS OF ENVIRONMENTAL CONCERN" means (a) any "hazardous substance" as
defined by the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended, (b) any "hazardous waste" as defined by the Resource
Conservation and Recovery Act, as amended, (c) any petroleum or petroleum
product, (d) any polychlorinated biphenyl and (e) any pollutant or contaminant
or hazardous, dangerous, or toxic chemical, material, waste or substance
regulated or defined under any other Environmental Law.
(16) Except as otherwise set forth in the Offering Memorandum or such
as are not material to the business, financial condition or results of operation
of the Company and its subsidiaries taken as a whole, the Company and each of
its Subsidiaries has good title, free and clear of all liens, claims,
encumbrances and
14
restrictions except liens for taxes not yet due and payable, to all properties
and assets described in the Offering Memorandum as being owned by it except for
liens, claims, encumbrances and restrictions which would not, singly or in the
aggregate, have a Material Adverse Effect. All leases to which the Company or
any of its Subsidiaries is a party are valid and binding on the Company or such
Subsidiary and, to the Company's knowledge, on the other party or parties and,
to the knowledge of the Company, no default has occurred or is continuing
thereunder, which might result in any material adverse change in the business,
financial condition or results of operations of the Company and its
subsidiaries, taken as a whole (a "MATERIAL ADVERSE CHANGE").
(17) Deloitte & Touche LLP are independent public accountants with
respect to the Company as required by the Act and the Exchange Act. The
financial statements, together with the related schedules and notes included or
incorporated by reference in the Offering Memorandum (and any amendment or
supplement thereto), comply as to form in all material respects with the
requirements applicable to registration statements on Form S-3 under the Act and
present fairly in all material respects the consolidated financial position,
results of operations and changes in cash flows of the Company and its
consolidated subsidiaries on the basis stated or incorporated by reference in
the Offering Memorandum at the respective dates or for the respective periods to
which they apply; such statements and the related schedules and notes have been
prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods involved, except as disclosed
therein; and the other financial and statistical information and data included
or incorporated by reference in the Offering Memorandum (and any amendment or
supplement thereto) is, in all material respects, accurately presented and
prepared on a basis consistent with such financial statements and the books and
records of the Company and its subsidiaries.
(18) The Company and each of the Subsidiaries possess all
certificates, consents, exemptions, orders, permits, licenses, authorizations,
or other approvals (each, an "AUTHORIZATION") of and from, and has made all
declarations and filings with, all Federal, state, local and other governmental
authorities, all self-regulatory organizations and all courts and other
tribunals, necessary or required to own, lease, license and use its properties
and assets and to conduct its respective business in the manner described in the
Offering Memorandum, except to the extent that the failure to obtain or file
would not, singly or in the aggregate, have a Material Adverse Effect; all such
Authorizations are valid and in full force and effect and the Company and each
of the Subsidiaries are in compliance with the terms and conditions of all such
Authorizations and with the rules and regulations of the regulatory authorities
and governing bodies having jurisdiction with respect thereto, except where the
failure to be
15
in full force and effect or to be in compliance would not, singly or in the
aggregate, have a Material Adverse Effect.
(19) The Company is not (i) an "investment company" within the meaning
of the Investment Company Act of 1940, as amended (the "Investment Company
Act"), or (ii) a "holding company" or a "subsidiary company" of a holding
company, or an "affiliate" thereof within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
(20) 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 held by such person in the Exchange Offer Registration
Statement or any Shelf Registration Statement required by the Registration
Rights Agreement.
(21) Neither the Company nor any agent thereof acting on the behalf of
it has taken, and none of them will take, any action that might cause this
Agreement or the issuance or sale of the Series A Notes to violate Regulation T
(12 C.R.F. Part 220), Regulation U (12 C.F.R. Part 221) or Regulation X (12
C.F.R. Part 224) of the Board of Governors of the Federal Reserve System.
(22) No "nationally recognized statistical rating organization" as
such term is defined for purposes of Rule 436(g)(2) under the Act (i) has
imposed (or has informed the Company that it is considering imposing) any
condition (financial or otherwise) on the Company's retaining any rating
assigned to the Company or any securities of the Company or (ii) has indicated
to the Company that it is considering (a) the downgrading, suspension or
withdrawal of, or any review for a possible change that does not indicate the
direction of the possible change in, any rating so assigned or (b) any adverse
or negative change in the rating of any securities of the Company.
(23) Since the respective dates as of which the information is given
in the Offering Memorandum other than as set forth in the Offering Memorandum
(exclusive of any amendments or supplements thereto subsequent to the date of
this Agreement), (i) neither the Company, nor any of the Subsidiaries, has
incurred any liabilities or obligations, direct or contingent, which are
material to the Company and the Subsidiaries taken as a whole, nor entered into
any transaction not in the ordinary course of business and (ii) there has not
been, singly or in the aggregate, any Material Adverse Change or any development
which may reasonably be expected to involve a Material Adverse Change.
16
(24) The Company is subject to Section 13 or 15(d) of the Exchange
Act.
(25) When the Series A Notes are issued and delivered pursuant to this
Agreement, the Series A Notes will not be of the same class (within the meaning
of Rule 144A under the Act) as any security of the Company that is listed on a
national securities exchange registered under Section 6 of the Exchange Act or
that is quoted in a United States automated inter-dealer quotation system.
(26) No form of general solicitation or general advertising (as
defined in Regulation D under the Act) was used by the Company or any of its
representatives (other than the Initial Purchasers, as to whom the Company makes
no representation) in connection with the offer and sale of the Series A Notes
contemplated hereby, including, but not limited to, articles, notices or other
communications published in any newspaper, magazine, or similar medium or
broadcast over television or radio, or any seminar or meeting whose attendees
have been invited by any general solicitation or general advertising. No
securities of the same class as the Series A Notes have been issued and sold by
the Company within the six-month period immediately prior to the date hereof.
(27) Prior to the effectiveness of any Registration Statement, the
Indenture is not required to be qualified under the TIA.
(28) None of the Company nor any of its affiliates or any person
acting on behalf of any of them (other than the Initial Purchasers, as to whom
the Company makes no representation) has engaged or will engage in any directed
selling efforts within the meaning of Regulation S under the Act
("REGULATION S") with respect to the Series A Notes.
(29) The Series A Notes offered and sold in reliance on Regulation S
have been and will be offered and sold only in offshore transactions within the
meaning of Regulation S.
(30) The sale of the Series A Notes pursuant to Regulation S is not
part of a plan or scheme to evade the registration provisions of the Act.
(31) No registration under the Act of the Series A Notes is required
for the sale of the Series A Notes to the Initial Purchasers as contemplated
17
hereby or for the Exempt Resales on the terms set forth in the Offering
Memorandum assuming the accuracy of the Initial Purchasers' representations and
warranties and agreements set forth in Section 7 hereof.
(a) Each certificate signed by any officer of the Company and
delivered to the Initial Purchasers or counsel for the Initial Purchasers shall
be deemed to be a representation and warranty of the Company to the Initial
Purchasers as to the matters covered thereby.
The Company acknowledges that the Initial Purchasers and, for purposes
of the opinions to be delivered to the Initial Purchasers pursuant to Section 9
hereof, counsel to the Company and counsel to the Initial Purchasers, will rely
upon the accuracy and truth of the foregoing representations and hereby consent
to such reliance.
7. INITIAL PURCHASERS' REPRESENTATIONS AND WARRANTIES. Each of the
Initial Purchasers, severally and not jointly, represents and warrants to the
Company, and agrees that:
(1) Such Initial Purchaser is a QIB, with such knowledge and
experience in financial and business matters as is necessary in order to
evaluate the merits and risks of an investment in the Series A Notes.
(2) Such Initial Purchaser (A) is not acquiring the Series A Notes
with a view to any distribution thereof or with any present intention of
offering or selling any of the Series A Notes in a transaction that would
violate the Act or the securities laws of any state of the United States or any
other applicable jurisdiction and (B) will be reoffering and reselling the
Series A Notes only to (x) QIBs in reliance on the exemption from the
registration requirements of the Act provided by Rule 144A and (y) in offshore
transactions in reliance upon Regulation S under the Act.
(3) No form of general solicitation or general advertising (within
the meaning of Regulation D under the Act) has been or will be used by such
Initial Purchaser or any of its representatives in connection with the offer and
sale of the Series A Notes pursuant hereto, including, but not limited to,
articles, notices or other communications published in any newspaper, magazine
or similar medium or broadcast over television or radio, or any seminar or
meeting whose attendees have been invited by any general solicitation or general
advertising.
18
(4) In connection with Exempt Resales, such Initial Purchaser
will solicit offers to buy the Series A Notes only from, and will offer to sell
the Series A Notes only to, Eligible Purchasers. Each Initial Purchaser further
agrees that it will offer to sell the Series A Notes only to, and will solicit
offers to buy the Series A Notes only from (1)(A) QIBs who, in purchasing the
Series A Notes will be deemed to have represented and agreed that (x) they are
purchasing the Series A Notes for their own accounts or accounts with respect to
which they exercise sole investment discretion and that they or such accounts
are QIBs and (y) they acknowledge that the seller of such Series A Notes may be
relying on the exemption from the provisions of Section 5 of the Act provided by
Rule 144A thereunder and that such Series A Notes will not have been registered
under the Act and (B) Regulation S Purchasers who, in purchasing the Series A
Notes, will be deemed to have represented and agreed that their purchase of
Series A Notes pursuant to Regulation S is not part of a plan or a scheme to
evade the registration provisions of the Act and (2) Eligible Purchasers that
agree that (x) Series A Notes purchased by them may be resold, pledged or
otherwise transferred within the time period referred to under Rule 144(k) under
the Act (taking into account the provisions of Rule 144(d) under the Act, if
applicable), as in effect on the date of the transfer of such Series A Notes,
only (I) to the Company, (II) to a person whom the seller reasonably believes is
a QIB purchasing for its own account or for the account of a QIB in a
transaction meeting the requirements of Rule 144A under the Act, (III) in an
offshore transaction (as defined in Rule 902 under the Act) meeting the
requirements of Rule 903 or 904 of the Act, (IV) in a transaction meeting the
requirements of Rule 144 under the Act, (V) to an institutional "accredited
investor," as defined in Rule 501(a)(1), (2), (3) or (7) under the Act that,
prior to such transfer, furnishes the Trustee a signed letter containing certain
representations and agreements relating to the registration of transfer of such
Series A Note (the form of which will be attached as EXHIBIT C to the Series A
Notes) and, if such transfer is in respect of an aggregate principal amount of
Series A Notes less than $250,000, an opinion of counsel acceptable to the
Company that such transfer is in compliance with the Act, (VI) in accordance
with another exemption from the registration requirements of the Act (and based
upon an opinion of counsel acceptable to the Company) or (VII) pursuant to an
effective registration statement and, in each case, in accordance with the
applicable securities laws of any state of the United States or any other
acceptable jurisdiction and (y) they will deliver to each person to whom such
Series A Notes or an interest therein is transferred a notice substantially to
the effect of the foregoing.
(5) Neither such Initial Purchaser nor any of its affiliates or any
person acting on its behalf has engaged in any directed selling efforts within
the meaning of Regulation S with respect to the Series A Notes.
19
(6) The Series A Notes offered and sold by such Initial Purchaser
pursuant hereto in reliance on Regulation S have been and will be offered and
sold only in offshore transactions.
(7) The sale of the Series A Notes offered and sold by such Initial
Purchaser pursuant hereto in reliance on Regulation S is not part of a plan or
scheme to evade the registration provisions of the Act.
(8) Such Initial Purchaser agrees that is has offered the Series A
Notes and will offer and sell the Series A Notes (i) as part of its distribution
at any time and (ii) otherwise until 40 days after the later of the commencement
of the offering of the Series A Notes and the Closing Date, only in accordance
with Rule 903 of Regulation S or another exemption from the registration
requirements of the Securities Act. Accordingly, neither such Initial
Purchaser, its affiliates nor any persons acting on its or their behalf has
engaged or will engage in any directed selling efforts within the meaning of
Rule 901(b) of Regulation S with respect to the Series A Notes, and such Initial
Purchaser, its affiliates and all persons acting on its or their behalf have
complied and will comply with the offering restrictions requirements of
Regulation S.
(9) Such Initial Purchaser agrees that, at or prior to confirmation
of a sale of Series A Notes, it will have sent to each distributor, dealer or
person receiving a selling concession, fee or other remuneration that purchases
Series A Notes from it during the restricted period a confirmation or notice to
substantially the following effect:
"The Securities covered hereby have not been registered under the U.S.
Securities Act of 1933, as amended (the 'Securities Act'), and may not be
offered and sold within the United States or to, or for the account or
benefit of, U.S. persons (i) as part of their distribution at any time or
(ii) otherwise until 40 days after the later of the commencement of the
Offering and the Closing Date, except in either case in accordance with
Regulation S (or Rule 144A or to Accredited Investors in transactions that
are exempt from the registration requirements of the Securities Act) under
the Securities Act. Terms used above have the meanings assigned to them in
Regulation S."
Such Initial Purchaser further agrees that it has not entered and will not enter
into any contractual arrangement with respect to the distribution or delivery of
the Series A Notes, except with its affiliates or with the prior written consent
of the Company.
20
(10) Such Initial Purchaser (i) has not offered or sold and will not
offer or sell any Series A Notes to persons in the United Kingdom prior to the
expiry of the period of six months from the issue date of the Series A Notes,
except to persons whose ordinary activities involve them in acquiring, holding,
managing or disposing of investments (as principal or agent) for the 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) has complied and will
comply with all applicable provisions of the Financial Services Act 1986 with
respect to anything done by it in relation to the Series A Notes in, from or
otherwise involving the United Kingdom and (iii) has only issued or passed on
and will only issue or pass on in the United Kingdom any document received by it
in connection with the issuance or the Series A Notes to a person who is of a
kind described in Article 11(3) of the Financial Services Act of 1986
(Investment Advertisements) (Exemptions) Order 1996 or is a person to whom the
document may otherwise lawfully be issued or passed on.
(11) Such Initial Purchaser will not offer, sell or deliver any of the
Series A Notes in any jurisdiction outside the United States except under
circumstances that will result in compliance with the applicable laws thereof,
and will take at its owns expense whatever action is required to permit its
purchase and resale of the Series A Notes in such jurisdictions. Such Initial
Purchaser understands that no action has been taken to permit a public offering
in any jurisdiction outside the United States where action would be required for
such purpose.
The Initial Purchasers acknowledge that the Company and, for purposes
of the opinions to be delivered to each Initial Purchaser pursuant to Section 9
hereof, counsel to the Company and counsel to the Initial Purchasers will rely
upon the accuracy and truth of the foregoing representations and the Initial
Purchasers hereby consent to such reliance.
8. INDEMNIFICATION.
(1) The Company agrees to indemnify and hold harmless each Initial
Purchaser and each person, if any, who controls any Initial Purchaser within the
meaning of either Section 15 of the Securities Act or Section 20 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), from and
against any and all losses, claims, damages and liabilities (including, without
limitation, any legal or other expenses reasonably incurred in connection with
defending or investigating any such action or claim) caused by any untrue
statement or alleged untrue statement of a material
21
fact contained in the Offering Memorandum (or any amendment or supplement
thereto) or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any such untrue statement or omission or alleged
untrue statement or omission based upon information relating to any Initial
Purchaser furnished to the Company in writing by such Initial Purchaser
expressly for use therein.
(2) Each Initial Purchaser agrees, severally and not jointly, to
indemnify and hold harmless the Company, its directors and officers and each
person, if any, who controls the Company within the meaning of either Section 15
of the Securities Act or Section 20 of the Exchange Act to the same extent as
the foregoing indemnity from the Company to such Initial Purchaser, but only
with reference to information relating to such Initial Purchaser furnished to
the Company in writing by such Initial Purchaser through you expressly for use
in the Offering Memorandum or any amendment or supplement thereto.
(3) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to Section 8(a) or 8(b), such person (the "indemnified party")
shall promptly notify the person against whom such indemnity may be sought (the
"indemnifying party") in writing and the indemnifying party, upon request of the
indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the reasonable
fees and disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party 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 party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party 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 the indemnifying party
shall not, in respect of the legal expenses of any indemnified party 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 such indemnified parties and that all such fees
and expenses shall be reimbursed as they are incurred. Such firm shall be
designated in writing by Xxxxxx Xxxxxxx & Co. Incorporated, in the case of
parties indemnified pursuant to Section 8(a), and by the Company, in the case of
parties
22
indemnified pursuant to Section 8(b). The indemnifying party 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, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or judgment.
No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened proceeding
in respect of which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party, unless
such settlement includes an unconditional release of such indemnified party from
all liability on claims that are the subject matter of such proceeding.
(4) To the extent the indemnification provided for in Section 8(a) or
8(b) is unavailable to an indemnified party or insufficient in respect of any
losses, claims, damages or liabilities referred to therein, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party 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 Company on the one hand and the Initial Purchasers on
the other hand from the offering of the Series A Notes or (ii) if the allocation
provided by clause 8(d)(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 8(d)(i) above but also the relative fault of the Company on the one
hand and of the Initial Purchasers on the other hand 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 Company on the one hand and the Initial
Purchasers on the other hand in connection with the offering of the Series A
Notes shall be deemed to be in the same respective proportions as the net
proceeds from the offering of the Series A Notes (before deducting expenses)
received by the Company and the total discounts and commissions received by the
Initial Purchasers bear to the total price to investors of the Series A Notes,
in each case as set forth in the table on the cover of the Offering Memorandum.
The relative fault of the Company on the one hand and the Initial Purchasers on
the other hand 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 by the Initial Purchasers and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Initial Purchasers' respective obligations to
contribute pursuant to this Section 8 are several in proportion to the
respective principal amount of Series A Notes they have purchased hereunder, and
not joint.
23
(5) The Company and the Initial Purchasers agree that it would not be
just or equitable if contribution pursuant to this Section 8 were determined by
pro rata allocation (even if the Initial Purchasers were treated as one entity
for such purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in Section 8(d). The amount
paid or payable by an indemnified party 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 reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 8, no Initial Purchaser shall be required to
contribute any amount in excess of the amount by which the total price at which
the Series A Notes purchased by an Initial Purchaser were sold to investors in
Exempt Resales exceeds the amount of any damages that such Initial Purchaser 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 8 are
not exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity.
(6) The indemnity and contribution provisions contained in this
Section 8 and the representations, warranties and other statements of the
Company contained 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 any Initial Purchaser or any person
controlling any Initial Purchaser or by or on behalf of the Company, its
officers or directors or any person controlling the Company and (iii) acceptance
of and payment for any of the Series A Notes.
9. CONDITIONS OF INITIAL PURCHASERS' OBLIGATIONS. The obligations of the
Initial Purchasers to purchase the Series A Notes under this Agreement are
subject to the satisfaction of each of the following conditions:
(1) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date:
(1) there shall not have occurred any downgrading, nor shall any
notice have been given of any intended or potential downgrading or of any
review for a possible change that does not indicate the direction of the
24
possible change, in the rating accorded any of the Company's debt
securities by any "nationally recognized statistical rating organization,"
as such term is defined for purposes of Rule 436(g)(2) under the Securities
Act; and
(2) there shall not have occurred any change, or any development
involving a prospective change, in the condition, financial or otherwise,
or in the earnings, business or operations of the Company and its
subsidiaries, taken as a whole, from that set forth in the Offering
Memorandum (exclusive of any amendments or supplements thereto subsequent
to the date of this Agreement) that, in the judgment of the Initial
Purchasers, is material and adverse and that makes it, in the judgment of
the Initial Purchasers, impracticable to market the Series A Notes on the
terms and in the manner contemplated in the Offering Memorandum.
(2) The Initial Purchasers shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer of the
Company, to the effect set forth in Section 9(a)(i) above and to the effect that
the representations and warranties of the Company contained in this Agreement
are true and correct as of the Closing Date and that the Company has complied
with all of the agreements and satisfied all of the conditions on its part to be
performed or satisfied hereunder on or before the Closing Date. The officer
signing and delivering such certificate may rely upon the best of his or her
knowledge as to proceedings threatened.
(b) No action shall have been taken (including the issuance of any
stop order) and no statute, rule, regulation or order shall have been enacted,
adopted or issued by any governmental agency which would, as of the Closing
Date, have a Material Adverse Effect;
(3) The Initial Purchasers shall have received on the Closing Date an
opinion (satisfactory to you and your counsel), dated the Closing Date, of
Xxxxxx & Xxxxxxx, counsel for the Company, to the effect that:
(1) the Company and its subsidiaries listed on a schedule to
such opinion (collectively, the "Material Subsidiaries") have each been
duly organized and are validly existing and in good standing under
applicable corporate law of their respective states of organization. The
Company and its Material Subsidiaries each have the power and authority to
own, lease and operate their respective properties and to conduct their
respective businesses as described in the Offering Memorandum;
25
(2) this Agreement has been duly authorized, executed and
delivered by the Company;
(3) the Series A Notes have been duly authorized and, when
executed and authenticated in accordance with the provisions of the
Indenture and delivered to and paid for by the Initial Purchasers in
accordance with the terms of this Agreement, will be entitled to the
benefits of the Indenture and will be valid and binding obligations of the
Company, enforceable in accordance with their terms;
(4) the Series B Notes have been duly authorized by the Company;
(5) the statements in the Offering Memorandum under the captions
"Exchange Offer; Registration Rights," "Description of Notes," and "Private
Placement" (but only the statements that summarize the provisions of this
Agreement) insofar as such statements constitute a summary of legal
matters, documents or proceedings referred to therein, are accurate in all
material respects;
(6) the Indenture has been duly authorized, executed and
delivered by the Company and is a valid and binding agreement of the
Company, enforceable in accordance with its terms;
(7) the Registration Rights Agreement has been duly authorized,
executed and delivered by the Company and is a valid and binding agreement
of the Company, enforceable in accordance with its terms;
(8) the execution, delivery and performance by the Company of
this Agreement and the other Operative Documents and the consummation of
the transactions contemplated hereby and thereby will not (A) to the best
of such counsel's knowledge, require any consent, approval, authorization
or other order of, or filing with, any federal, California, New York,
Illinois or District of Columbia court or governmental agency or body
(except such as may be required under state securities or Blue Sky laws),
(B) conflict with or constitute a breach of any of the terms or provisions
of the certificate of incorporation or formation, as the case may be, or
by-laws, operating agreements or partnership agreements, as the case may
be, of the Company or any of its
26
Subsidiaries, or (C) violate or conflict with any federal, California, New
York, Illinois or District of Columbia statute, rule or regulation
applicable to the Company or its subsidiaries or the General Corporation
Law of the State of the Delaware (other than federal or state securities
laws, which are specifically addressed elsewhere herein), except for such
conflicts and violations as to which the Company has obtained the necessary
consents or waivers;
(9) neither the Company nor any of the Subsidiaries is an
"investment company" within the meaning of the Investment Company Act of
1940, as amended;
(10) No registration of the Notes under the Securities Act, and
no qualification of the Indenture under the Trust Indenture Act, is
required for the purchase of the Notes by the Initial Purchasers or the
initial resale of the Notes by the Initial Purchasers to Eligible
Purchasers, in each case, in the manner contemplated by the Purchase
Agreement. We express no opinion, however, as to when or under what
circumstances any Notes initially sold by the Initial Purchasers may be
reoffered or resold.
Such counsel shall also state that they have participated in
conferences with officers and other representatives of the Company,
representatives of the independent public accountants for the Company, and
representatives of the Initial Purchasers and their counsel, at which the
contents of the Offering Memorandum and related matters were discussed and,
although they are not passing upon, and do not assume any responsibility for,
the accuracy, completeness or fairness of the statements contained in the
Offering Memorandum (except as set forth in paragraph (iv) above) and have not
made any independent check or verification thereof, during the course of such
participation, no facts came to their attention that caused them to believe that
the Offering Memorandum (as amended or supplemented, if applicable), as of its
date or as of the Closing Date, contained an untrue statement of a material fact
or omitted to state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading; it
being understood that such counsel shall express no belief with respect to the
financial statements and other financial data included or incorporated by
reference in or omitted from the Offering Memorandum.
In rendering the opinion set forth in paragraphs (iii), (v) and (vi)
above, such counsel may state that such opinion is subject to the following
exceptions, limitations and qualifications: (i) the effect of bankruptcy,
insolvency, reorganization, fraudulent transfers or obligations, moratorium or
other similar laws now or hereafter
27
in effect relating to or affecting the rights and remedies of creditors; (ii)
the effect of general principles of equity, whether enforcement is considered in
a proceeding in equity or law, and the discretion of the court before which any
proceeding therefor may be brought; and (iii) the unenforceability under certain
circumstances under law or court decisions of provisions providing for the
indemnification of or contribution to a party with respect to a liability where
such indemnification or contribution is contrary to public policy.
Such opinion shall be rendered to the Initial Purchasers at the
request of the Company and shall so state therein.
(4) The Initial Purchasers shall have received on the Closing Date an
opinion, dated the Closing Date, of Xxxxxxxx X. Xxxxx, Executive Vice President,
Chief Legal and Administrative Officer and Secretary of the Company, to the
effect that:
(1) to the best of such counsel's knowledge, there is no action,
suit or proceeding before or by any court or governmental agency or body
pending against the Company or any Subsidiary or any of their respective
properties which might result, singly or in the aggregate, in a Material
Adverse Effect.
(2) to such counsel's knowledge, the execution and delivery of
the Purchase Agreement, the Registration Rights Agreement and Indenture by
the Company does not violate any order of any court or governmental agency
or body having jurisdiction over the Company or any of its properties; and
(3) to such counsel's knowledge, all of the outstanding capital
stock of each of the Subsidiaries is owned of record by the Company, either
directly or indirectly through one or more of its subsidiaries, free and
clear of any security interest, claim, lien or encumbrance, other than any
security interests which may be described in the Offering Memorandum; to
such counsel's knowledge, there are no outstanding rights, warrants or
options to acquire, or instruments convertible into or exchangeable for,
any shares of capital stock or other equity interest in any Subsidiary,
except as may be described in the Offering Memorandum.
28
Such counsel shall also state that such counsel has participated in
conferences with officers and other representatives of the Company,
representatives of the independent public accountants for the Company, and
representatives of the Initial Purchasers and their counsel, at which the
contents of the Offering Memorandum and related matters were discussed and,
although such counsel is not passing upon, and does not assume any
responsibility for, the accuracy, completeness or fairness of the statements
contained in the Offering Memorandum and has not made any independent check or
verification thereof, during the course of such participation (relying as to
materiality to the extent deemed appropriate upon the statements of officers and
other representatives of the Company), no facts came to such counsel's attention
that caused such counsel to believe that the Offering Memorandum (as amended or
supplemented, if applicable), as of its date or as of the Closing Date,
contained an untrue statement of a material fact or omitted to state a material
fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; it being understood that such
counsel shall express no belief with respect to the financial statements,
schedules and other financial and statistical data included or incorporated by
reference in the Offering Memorandum.
(5) The Initial Purchasers shall have received on the Closing Date an
opinion, dated the Closing Date, of Xxxxxxx, Arps, Slate, Xxxxxxx & Xxxx LLP,
special counsel for the Initial Purchasers, in form and substance reasonably
satisfactory to the Initial Purchasers.
(6) The Initial Purchasers shall have received on the Closing Date, a
letter dated the Closing Date in form and substance satisfactory to the Initial
Purchasers from Deloitte & Touche LLP, independent public accountants,
containing the information and statements of the type ordinarily included in
accountants' "comfort letters" to the Initial Purchasers with respect to the
financial statements and certain financial information included or incorporated
by reference in the Offering Memorandum.
(7) The Series A Notes shall have been approved by the NASD for
trading and duly listed in PORTAL.
(8) The Company and the Trustee shall have entered into the Indenture
and the Initial Purchasers shall have received a counterpart, conformed as
executed, thereof.
29
(9) The Company shall have executed the Registration Rights Agreement
and the Initial Purchasers shall have received an original copy thereof, duly
executed by the Company.
(10) The Company shall not have failed at or prior to the Closing Date
to perform or comply with any of the agreements herein contained and required to
be performed or complied with by the Company at or prior to the Closing Date.
(11) The consent from the Lenders under the Company's credit
facilities shall be in full force and effect and shall not have been modified,
amended or rescinded.
10. EFFECTIVENESS OF AGREEMENT AND TERMINATION. This Agreement shall
become effective upon the delivery of this Agreement by the parties hereto.
This Agreement shall be subject to termination by notice given by the
Initial Purchasers to the Company, if (a) 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, any of the
New York Stock Exchange, the American Stock Exchange, the National Association
of Securities Dealers, Inc., the Chicago Board of Options Exchange, the Chicago
Mercantile Exchange or the Chicago Board of Trade, (ii) trading of any
securities of the Company 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 or (iv) 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 Initial Purchasers, is material and adverse and (b)
in the case of any of the events specified in clauses 10(a)(i) through
10(a)(iv), such event, singly or together with any other such event, makes it,
in the judgment of the Initial Purchasers, impracticable to market the Series A
Notes on the terms and in the manner contemplated in the Offering Memorandum.
If, on the Closing Date any one or more of the Initial Purchasers
shall fail or refuse to purchase Series A Notes that it has or they have agreed
to purchase hereunder on such date, and the aggregate principal amount of Series
A Notes which such defaulting Initial Purchaser or Initial Purchasers agreed but
failed or refused to purchase is not more than one-tenth of the aggregate
principal amount of the Series A Notes to be purchased on such date, the other
Initial Purchasers shall be obligated
30
severally in the proportions that the principal amount of Series A Notes set
forth opposite their respective names in Schedule A bears to the aggregate
principal amount of Series A Notes set forth opposite the names of all such
non-defaulting Initial Purchasers, or in such other proportions as the Initial
Purchasers may specify, to purchase the Series A Notes which such defaulting
Initial Purchaser or Initial Purchasers agreed but failed or refused to purchase
on such date; PROVIDED that in no event shall the principal amount of Series A
Notes that any Initial Purchaser has agreed to purchase pursuant to this
Agreement be increased pursuant to this Section 10 by an amount in excess of
one-ninth of such principal amount of Series A Notes without the written consent
of such Initial Purchaser. If, on the Closing Date, any Initial Purchaser or
Initial Purchasers shall fail or refuse to purchase Series A Notes and the
aggregate principal amount of Series A Notes with respect to which such default
occurs is more than one-tenth of the aggregate principal amount of Series A
Notes to be purchased, and arrangements satisfactory to the Initial Purchasers
and the Company for the purchase of such Series A Notes are not made within 36
hours after such default, this Agreement shall terminate without liability on
the part of any non-defaulting Initial Purchaser or the Company. In any such
case either the Initial Purchasers or the Company shall have the right to
postpone the Closing Date, but in no event for longer than seven days, in order
that the required changes, if any, in Offering Memorandum or in any other
documents or arrangements may be effected. Any action taken under this
paragraph shall not relieve any defaulting Initial Purchaser from liability in
respect of any default of such Initial Purchaser under this Agreement.
11. MISCELLANEOUS. Notices given pursuant to any provision of this
Agreement shall be addressed as follows: (i) if to the Company, to World Color
Press, Inc., The Mill, 000 Xxxxxxxxxx Xxxx, Xxxxxxxxx, Xxxx, Attention:
Executive Vice President, Chief Legal and Administrative Officer and Secretary,
with a copy to Xxxxxx & Xxxxxxx, 000 Xxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx
Xxxx 00000, Attention: Xxxxxx Xxxxx Xxxxx, Esq.; (ii) if to any Initial
Purchaser, c/o Morgan Xxxxxxx & Co. Incorporated, Corporate Finance Department,
0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxxx Xxxx, with a
copy to Xxxxxxx, Arps, Slate, Xxxxxxx & Xxxx LLP at 000 Xxxxx Xxxxxx, Xxx Xxxx,
XX 00000, Attention: Xxxx X. Xxxxx or (iii) in any case to such other address
as the person to be notified may have requested in writing.
The respective indemnities, contribution agreements, representations,
warranties and other statements of the Company and the Initial Purchasers set
forth in or made pursuant to this Agreement shall remain operative and in full
force and effect, and will survive delivery of and payment for the Series A
Notes, regardless of (i) any
31
investigation, or statement as to the results thereof, made by or on behalf of
an Initial Purchaser, the officers or directors of an Initial Purchaser, any
person controlling an Initial Purchaser, the Company, the officers or directors
of the Company, or any person controlling the Company, (ii) acceptance of the
Series A Notes and payment for them hereunder and (iii) termination of this
Agreement.
If this Agreement shall be terminated by the Initial Purchasers, or
any of them, because of any failure or refusal on the part of the Company to
comply with the terms or to fulfill any of the conditions of this Agreement, or
if for any reason the Company shall be unable to perform its obligations under
this Agreement, the Company will reimburse the Initial Purchasers or such
Initial Purchasers as have so terminated this Agreement with respect to
themselves, severally, for all out-of-pocket expenses (including the fees and
disbursements of their counsel) reasonably incurred by such Initial Purchasers
in connection with this Agreement or the offering contemplated hereunder.
Except as otherwise provided, this Agreement has been and is made
solely for the benefit of and shall be binding upon the Company, the Initial
Purchasers, the Initial Purchasers' directors and officers, any controlling
persons referred to herein, the directors of the Company, and their respective
successors and assigns, all as and to the extent provided in this Agreement, and
no other person shall acquire or have any right under or by virtue of this
Agreement. The term "successors and assigns" shall not include a purchaser of
any of the Series A Notes from the Initial Purchasers merely because of such
purchase.
THIS AGREEMENT SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK.
This Agreement may be signed in various counterparts which together
shall constitute one and the same instrument.
32
Please confirm that the foregoing correctly sets forth the agreement
among the Company and the Initial Purchasers.
Very truly yours,
WORLD COLOR PRESS, INC.
By: /s/ Xxxxxxxx Xxxxx
---------------------------------
Name: Xxxxxxxx Xxxxx
Title: Vice Chairman, Chief Legal and
Administrative Officer
The foregoing Purchase Agreement
is hereby confirmed and accepted
as of the date first above written.
XXXXXX XXXXXXX & CO. INCORPORATED
ABN AMRO INCORPORATED
BANCBOSTON XXXXXXXXX XXXXXXXX INC.
CIBC XXXXXXXXXXX CORP.
FLEET SECURITIES INC.
By: XXXXXX STANLEY& CO. INCORPORATED
By: /s/ Xxxxxxxx X. Xxxx
-------------------------------
Name: Xxxxxxxx X. Xxxx
Title: Principal
SCHEDULE A
Principal
Initial Purchaser Amount of Notes
----------------- ---------------
Xxxxxx Xxxxxxx Co. & Incorporated $240,000,000
ABN AMRO Incorporated 15,000,000
BancBoston Xxxxxxxxx Xxxxxxxx Inc 15,000,000
CIBC Xxxxxxxxxxx Corp. 15,000,000
Fleet Securities Inc. 15,000,000
============
Total $300,000,000
