$280,000,000 EXHIBIT 99.4
CSK AUTO, INC.
12% SENIOR NOTES DUE 2006
PURCHASE AGREEMENT
December 7, 2001
CREDIT SUISSE FIRST BOSTON CORPORATION
X.X. XXXXXX SECURITIES INC.
UBS WARBURG LLC,
As Representatives of the Several Purchasers,
c/o Credit Suisse First Boston Corporation,
Eleven Madison Avenue,
New York, N.Y. 10010-3629
Dear Sirs:
1. Introductory. CSK Auto, Inc., an Arizona corporation (the
"COMPANY"), proposes, subject to the terms and conditions stated herein, to
issue and sell to Credit Suisse First Boston Corporation, X.X. Xxxxxx Securities
Inc. and UBS Warburg LLC (the "PURCHASERS") U.S. $280,000,000 principal amount
of its 12% Senior Notes due 2006 ("OFFERED SECURITIES") to be issued under an
indenture (the "INDENTURE"), dated as of the Closing Date (as defined below),
between the Company, the guarantors named therein (each, a "GUARANTOR," and
collectively, the "GUARANTORS") and The Bank of New York, as trustee (the
"TRUSTEE"). The Offered Securities will be irrevocably and unconditionally
guaranteed (the "GUARANTEES") as to payment of principal, premium, if any,
interest and Liquidated Damages (as defined in the Indenture), if any, on a
senior basis, jointly and severally by each of the Guarantors. The United States
Securities Act of 1933 is herein referred to as the "SECURITIES ACT."
Holders (including subsequent transferees) of the Offered Securities
will have the registration rights set forth in the registration rights agreement
(the "REGISTRATION RIGHTS AGREEMENT"), to be dated the Closing Date, in
substantially the form of Exhibit I hereto, for so long as such Offered
Securities constitute "TRANSFER RESTRICTED SECURITIES" (as defined in the
Registration Rights Agreement). Pursuant to the Registration Rights Agreement,
the Company and the Guarantors will agree to file with the Securities and
Exchange Commission (the "COMMISSION") under the circumstances set forth
therein, (i) a registration statement under the Securities Act (the "EXCHANGE
OFFER REGISTRATION STATEMENT") relating to the Company's 12% Senior Notes due
2006 in a like aggregate principal amount as the Company issued under the
Indenture, identical in all material respects to the Offered Securities and
registered under the Securities Act (the "EXCHANGE SECURITIES"), with guarantees
endorsed thereon by the Guarantors to be offered in exchange for the Offered
Securities (such offer to exchange being referred to as the "EXCHANGE OFFER")
and the Guarantees thereof and (ii) a shelf registration statement pursuant to
Rule 415 under the Securities 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 Offered Securities
and to 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. The Offered Securities
and the Exchange Securities are referred to collectively as the "SECURITIES".
The Company hereby agrees with the Purchasers as follows:
2. Representations and Warranties of the Company and the Guarantors.
The Company and the Guarantors represent and warrant to, and agree with, the
several Purchasers that:
(a) A preliminary offering circular and an offering circular
relating to the Offered Securities to be offered by the Purchasers have
been prepared by the Company. Such preliminary offering circular (the
"PRELIMINARY OFFERING CIRCULAR") and offering circular (the "OFFERING
CIRCULAR"), as supplemented as of the date of this Agreement, together
with any other document approved by the Company for use in connection
with the contemplated resale of the Offered Securities are hereinafter
collectively referred to as the "OFFERING DOCUMENT". The Preliminary
Offering Circular as of its date did not, and the Offering Circular on
the date of this Agreement, does not include any untrue statement of a
material fact or omit to state any material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading. The preceding sentence does not
apply to statements in or omissions from any Offering Document based
upon written information relating to any Purchaser furnished to the
Company by any Purchaser through Credit Suisse First Boston Corporation
("CSFBC") specifically for use therein, it being understood and agreed
that the only such information is that described as such in Section
7(b) hereof. Except as disclosed in the Offering Document, on the date
of this Agreement, the Annual Report on Form 10-K most recently filed
with the Securities and Exchange Commission (the "COMMISSION") by the
Company's parent company, CSK Auto Corporation ("CSK"), and all
subsequent reports (collectively, the "EXCHANGE ACT REPORTS") which
have been filed by CSK with the Commission or sent to stockholders
pursuant to the Securities Exchange Act of 1934 (the "EXCHANGE ACT") do
not include 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.
(b) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Arizona,
with power and authority (corporate and other) to own its properties
and conduct its business as described in the Offering Document; and the
Company 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 be so qualified would not
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 and the Guarantors taken as a whole
("MATERIAL ADVERSE EFFECT").
(c) All of the outstanding shares of capital stock of the
Company have been duly authorized and validly issued and are fully paid
and non-assessable.
(d) The entities listed on Schedule B hereto are the only
subsidiaries, direct or indirect, of the Company. CSK and each
subsidiary of the Company has been duly incorporated and is an existing
corporation in good standing under the laws of the jurisdiction of its
incorporation, with power and authority (corporate and other) to own
its properties and conduct its business as described in the Offering
Document; CSK and each subsidiary of the Company 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 be so qualified would not individually or in the aggregate
have a Material Adverse Effect; all of the issued and outstanding
capital stock of CSK and each subsidiary of the Company has been duly
authorized and validly issued and is fully paid and nonassessable; and
the capital stock of each subsidiary owned by the Company, directly or
through subsidiaries, is owned free from liens, encumbrances and
defects. On the Closing Date, the Offered Securities will conform as to
legal matters to the description thereof in the Offering Circular.
(e) The Indenture has been duly authorized by the Company and
the Offered Securities have been duly authorized by the Company. When
the Offered Securities are delivered and paid for
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pursuant to this Agreement on the Closing Date, the Indenture will have
been duly executed and delivered, such Offered Securities will have
been duly executed, authenticated, issued and delivered by the Company
and will conform to the description thereof contained in the Offering
Document in all material respects and the Indenture and such Offered
Securities will constitute valid and legally binding obligations of the
Company, enforceable 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 to general equity principles.
(f) The Indenture has been duly authorized by each Guarantor
and the Guarantee to be endorsed on the Offered Securities by each
Guarantor has been duly authorized by the applicable Guarantor. When
the Offered Securities are delivered and paid for pursuant to this
Agreement on the Closing Date, the Indenture will have been duly
executed and delivered by each Guarantor, the Guarantee of each
Guarantor endorsed thereon will have been duly executed, issued and
delivered by such Guarantor and the Indenture and Guarantee will
constitute valid and legally binding obligations of such Guarantor,
enforceable 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 to general equity principles.
(g) On the Closing Date, the Exchange Securities will have
been duly authorized by the Company and the Guarantors; and when the
Exchange Securities are issued, executed and authenticated in
accordance with the terms of the Exchange Offer and the Indenture, the
Exchange Securities will constitute valid and legally binding
obligations of the Company and the Guarantors, enforceable 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 to
general equity principles.
(h) The Guarantee to be endorsed on the Exchange Securities by
each Guarantor has been duly authorized by such Guarantor; and, when
issued, will have been duly executed and delivered by each such
Guarantor and will conform to the description thereof contained in the
Offering Document in all material respects. When the Exchange
Securities have been issued, executed and authenticated in accordance
with the terms of the Exchange Offer and the Indenture, the Guarantee
of each Guarantor endorsed thereon will constitute valid and legally
binding obligations of such Guarantor, enforceable in accordance with
its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.
(i) The Registration Rights Agreement has been duly authorized
by the Company and each of the Guarantors and, on the Closing Date,
will have been duly executed and delivered by the Company and each of
the Guarantors. When the Registration Rights Agreement has been duly
executed and delivered by the Company and the other parties thereto,
the Registration Rights Agreement will be a valid and binding agreement
of the Company and each of the Guarantors, enforceable against the
Company and each Guarantor in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles. On the Closing
Date, the Registration Rights Agreement will conform as to legal
matters to the description thereof in the Offering Circular in all
material respects.
(j) Except as disclosed in the Offering Document, 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
Purchaser for a brokerage commission, finder's fee or other like
payment in connection with the transactions contemplated hereby.
(k) No consent, approval, authorization, or order of, or
filing with, any governmental agency or body or any court is required
for the consummation of the transactions contemplated by this Agreement
(including the accuracy of the Purchasers' representations set forth in
Section 4 hereof) or
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the Registration Rights Agreement in connection with the issuance and
sale of the Offered Securities and the Guarantees by the Company and
the Guarantors, as applicable, except for the order of the Commission
declaring the Exchange Offer Registration Statement or the Shelf
Registration Statement effective.
(l) The execution, delivery and performance of the Indenture,
this Agreement and the Registration Rights Agreement by the Company and
the Guarantors, and the issuance and sale of the Offered Securities and
the Guarantees and compliance by the Company and the Guarantors with
the terms and provisions hereof and thereof will not result in a breach
or violation of any of the terms and provisions of, or constitute a
default under, (i) 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 subsidiary of the Company or any
of their properties, or (ii) any agreement or instrument to which the
Company or any such subsidiary is a party or by which the Company or
any such subsidiary is bound or to which any of the properties of the
Company or any such subsidiary is subject, (iii) or the charter or
by-laws of the Company or any such subsidiary. The Company and each
Guarantor has full power and authority to authorize, issue and sell the
Offered Securities or the Guarantees, as applicable, as contemplated by
this Agreement.
(m) This Agreement has been duly authorized, executed and
delivered by the Company and each of the Guarantors.
(n) Except as disclosed in the Offering Document, the Company,
CSK and each subsidiary of the Company have good and marketable title
to all real properties and all other properties and assets owned by
them, in each case free from liens, encumbrances and defects that would
materially affect the value thereof or materially interfere with the
use made or to be made thereof by them; and except as disclosed in the
Offering Document, the Company, CSK and each subsidiary of the Company
hold any leased real or personal property under valid and enforceable
leases with no exceptions that would materially interfere with the use
made or to be made thereof by them.
(o) Neither the Company, CSK nor any of the subsidiaries of
the Company is in violation of its respective charter or by-laws or in
default in the performance of any obligation, agreement, covenant or
condition contained in any indenture, loan agreement, mortgage, lease
or other agreement or instrument that is material to the Company, CSK
and the subsidiaries of the Company taken as a whole, 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.
(p) There are no contracts, agreements or understandings
between the Company or any Guarantor and any person granting such
person the right, (i) except as disclosed in the Offering Document, to
require the Company or such Guarantor to file a registration statement
under the Securities Act with respect to any securities of the Company
or such Guarantor or (ii) to require the Company or such Guarantor to
include such securities with the Securities and Guarantees registered
pursuant to any Registration Statement.
(q) The Company and the Guarantors possess adequate
certificates, authorities or permits issued by appropriate governmental
agencies or bodies necessary to conduct the business now operated by
them and have 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 or any of the Guarantors,
would individually or in the aggregate have a Material Adverse Effect.
(r) No labor dispute with the employees of the Company, CSK or
any subsidiary of the Company exists or, to the knowledge of the
Company, is imminent that might have a Material Adverse Effect.
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(s) The Company, CSK and the subsidiaries of the Company own,
possess 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 them, or presently employed by them, and have 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, CSK or any of the subsidiaries of
the Company, would individually or in the aggregate have a Material
Adverse Effect.
(t) Except as would not, individually or in the aggregate,
have a Material Adverse Effect or otherwise require disclosure in the
Offering Document, (i) none of CSK, the Company or any of its
subsidiaries has been or is in violation of any federal, state or local
laws and regulations relating to pollution or protection of human
health or the environment, including, without limitation, laws and
regulations relating to emissions, discharges, releases or threatened
releases of toxic or hazardous substances, materials or wastes, or
petroleum and petroleum products ("MATERIALS OF ENVIRONMENTAL
CONCERN"), or otherwise relating to the protection of human health and
safety, or the use, treatment, storage, disposal, transport or handling
of Materials of Environmental Concern (collectively, "ENVIRONMENTAL
LAWS"), which violation includes, but is not limited to, noncompliance
with, or lack of, any permits or other environmental authorizations;
(ii) there are no circumstances, either past, present or that are
reasonably foreseeable, that may lead to any such violation in the
future; (iii) none of CSK, the Company or any of its subsidiaries has
received any communication (written or oral), whether from a
governmental authority or otherwise, alleging any such violation; (iv)
there is no pending or threatened claim, action, investigation or
notice (written or oral) by any person or entity alleging potential
liability of CSK, the Company or any of its subsidiaries (or against
any person or entity for whose acts or omissions CSK, the Company or
any of its subsidiaries is or may reasonably be expected to be liable,
either contractually or by operation of law) for investigatory,
cleanup, or other response costs, or natural resources or property
damages, or personal injuries, attorney's fees or penalties relating to
(A) the presence, or release into the environment, of any Materials of
Environmental Concern at any location, or (B) circumstances forming the
basis of any violation or potential violation, of any Environmental Law
(collectively, "ENVIRONMENTAL CLAIMS"); and (v) there are no past or
present actions, activities, circumstances, conditions, events or
incidents that could form the basis of any Environmental Claim.
(u) Except as disclosed in the Offering Document, there are no
pending actions, suits or proceedings against or affecting the Company,
any of its subsidiaries or any of their respective properties that, if
determined adversely to the Company or any of its subsidiaries, would
individually or in the aggregate have a Material Adverse Effect, or
would materially and adversely affect the ability of the Company to
perform its obligations under the Indenture, this Agreement or the
Registration Rights Agreement, or which are otherwise material in the
context of the sale of the Offered Securities; and, to the Company's
knowledge, no such actions, suits or proceedings are threatened or
contemplated.
(v) The Company, CSK and each subsidiary of the Company
maintains a system of internal accounting controls sufficient to
provide reasonable assurance that (i) transactions are executed in
accordance with management's general or specific authorizations; (ii)
transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally accepted accounting
principles and to maintain asset accountability; (iii) access is
permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(w) PricewaterhouseCoopers LLP are independent public
accountants with respect to the Company, CSK and the subsidiaries of
the Company as required by the Securities Act.
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(x) The financial statements, together with the related
schedules and notes, included or incorporated in the Offering Document
present fairly the financial position of CSK, the Company and its
consolidated subsidiaries as of the dates shown in their results of
operations and cash flows for the periods shown, and such financial
statements and related schedules and notes have been prepared in
conformity with the generally accepted accounting principles in the
United States applied on a consistent basis and the assumptions used in
preparing the pro forma financial statements included in the Offering
Document 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; and the other financial and statistical
information and data set forth in the Offering Document are, in all
material respects, accurately presented and, with respect to such
financial information, prepared on a basis consistent with the
financial statements of CSK and the Company and the books and records
of CSK and the Company.
(y) Except as disclosed in the Offering Document, since the
date of the latest audited financial statements included in the
Offering Document 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, CSK and the subsidiaries of the Company
taken as a whole, and, except as disclosed in or contemplated by the
Offering Document, there has been no dividend or distribution of any
kind declared, paid or made by CSK or the Company on any class of its
capital stock.
(z) All indebtedness of the Company and the Guarantors that
will be repaid with the proceeds of the issuance and sale of the
Offered Securities was incurred, and the indebtedness represented by
the Offered Securities is being incurred, for proper purposes and in
good faith, and each of the Company and each Guarantor was, at the time
of the incurrence of such indebtedness that will be repaid with the
proceeds of the issuance and sale of the Offered Securities, and will
be on the Closing Date (after giving effect to the application of the
proceeds from the issuance of the Offered Securities), solvent, and had
at the time of the incurrence of such indebtedness that will be repaid
with the proceeds of the issuance and sale of the Offered Securities,
and will have on the Closing Date (after giving effect to the
application of the proceeds from the issuance of the Offered
Securities), sufficient capital for carrying on their respective
business and were, at the time of the incurrence of such indebtedness
that will be repaid with the proceeds of the issuance and sale of the
Offered Securities, and will be on the Closing Date (after giving
effect to the application of the proceeds from the issuance and sale of
the Offered Securities), able to pay their respective debts as they
become due.
(aa) Neither the Company nor CSK is an open-end investment
company, unit investment trust or face-amount certificate company that
is or is required to be registered under Section 8 of the United States
Investment Company Act of 1940 (the "INVESTMENT COMPANY ACT"); and each
of the Company and CSK is not and, after giving effect to the offering
and sale of the Offered Securities and the application of the proceeds
thereof as described in the Offering Document, will not be required to
register as an "investment company" as defined in the Investment
Company Act.
(bb) No securities of the same class (within the meaning of
Rule 144A(d)(3) under the Securities Act) as the Offered Securities are
listed on any national securities exchange registered under Section 6
of the Exchange Act or quoted in a U.S. automated inter-dealer
quotation system.
(cc) The offer and sale of the Offered Securities and the
Guarantees in the manner contemplated by this Agreement (including the
accuracy of the Purchasers' representations set forth in Section 4
hereof) will be exempt from the registration requirements of the
Securities Act by reason of Section 4(2) thereof and Regulation S
thereunder ("REGULATION S"); and it is not necessary to qualify an
indenture in respect of the Offered Securities under the United States
Trust Indenture Act of 1939, as amended (the "TRUST INDENTURE ACT").
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(dd) On the Closing Date, the Indenture will conform in all
material respects to the requirements of the Trust Indenture Act and
the rules and regulations of the Commission applicable to an indenture
which is qualified thereunder.
(ee) The Company, its affiliates and any person acting on its
or their behalf have complied and will comply with the offering
restrictions requirement of Regulation S. The Company has not entered
and will not enter into any contractual arrangement with respect to the
distribution of the Offered Securities except for this Agreement.
(ff) Neither the Company nor any Guarantor nor any agent
thereof acting on the behalf of them has taken, and none of them will
take, any action that might cause this Agreement or the issuance or
sale of the Offered Securities to violate Regulation T, Regulation U or
Regulation X of the Board of Governors of the Federal Reserve System.
(gg) No "nationally recognized statistical rating
organization" as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act (i) has imposed (or has informed the Company
or any Guarantor that it is considering imposing) any condition
(financial or otherwise) on the Company's or any Guarantor's retaining
any rating assigned to the Company or any Guarantor, any securities of
the Company or any Guarantor or (ii) has indicated to the Company or
any Guarantor that it is considering (a) the downgrading, suspension,
or withdrawal of, or any review of a possible change that does not
indicate the direction of the possible change in, any rating so
assigned or (b) any change in the outlook for any rating of the
Company, any Guarantor or any securities of the Company or any
Guarantor.
(hh) CSK is subject to Section 13 or 15(d) of the Exchange
Act.
(ii) No form of general solicitation or general advertising
(as defined in Regulation D under the Securities Act) was used by the
Company, the Guarantors or any of their respective representatives
(other than the Purchasers, as to whom the Company and the Guarantors
make no representation) in connection with the offer and sale of the
Offered Securities and the Guarantees contemplated hereby, including,
but not limited to, articles, notices or other communications published
in any newspaper, magazine, or similar media 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 Offered Securities have been
offered, issued or sold by the Company within the six-month period
immediately prior to the date hereof.
(jj) None of the Company, the Guarantors nor any of their
respective affiliates or any person acting on its or their behalf
(other than the Purchasers, as to whom the Company and the Guarantors
make no representation) has engaged or will engage in any directed
selling efforts within the meaning of Regulation S with respect to the
Offered Securities or the Guarantees.
(kk) None of the Company, the Guarantors nor any of their
respective affiliates or any person acting on its or their behalf
(other than the Purchasers, as to whom the Company and the Guarantors
make no representation) shall have taken or omitted to take any action
that shall have resulted in any Offered Securities or Guarantees
offered and sold in reliance on Regulation S not to have been offered
and sold only in offshore transactions.
(ll) The sale by the Company of the Offered Securities and
Guarantees pursuant to Regulation S is not part of a plan or scheme to
evade the registration provisions of the Securities Act.
(mm) All material Tax returns required to be filed by the
Company and the Guarantors have been filed and all such returns are
true, complete, and correct in all material respects. All material
Taxes that are due or claimed to be due from the Company and the
Guarantors have been paid other than those (i) currently payable
without penalty or interest or (ii) being contested in good faith and
by appropriate proceedings and for which, in the case of both clauses
(i) and (ii), adequate
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reserves have been established on the books and records of the Company
and the Guarantors in accordance with GAAP. There are no proposed,
material Tax assessments against the Company or any of the Guarantors.
The accruals and reserves on the books and records of the Company and
the Guarantors in respect of any material Tax liability for any Taxable
period not finally determined are reasonably adequate to meet any
assessments of Tax for any such period. For purposes of this Purchase
Agreement, the term "Tax" and "Taxes" shall mean all Federal, state,
local and foreign taxes, and other assessments of a similar nature
(whether imposed directly or through withholding), including any
interest, additions to tax, or penalties applicable thereto.
3. Purchase, Sale and Delivery of Offered 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
Purchasers, and the Purchasers agree, severally and not jointly, to purchase
from the Company the principal amount of Offered Securities set forth opposite
the names of such Purchasers on Schedule A hereto at a purchase price of 95.378%
of the principal amount thereof.
The Company will deliver against payment of the purchase price the
Offered Securities to be purchased by each Purchaser hereunder and to be offered
and sold by the Purchasers in reliance on Regulation S (the "REGULATION S
SECURITIES") in the form of one or more permanent global Securities in
registered form without interest coupons (the "REGULATION S GLOBAL SECURITIES")
which will be deposited with the Trustee as custodian for The Depository Trust
Company ("DTC") for the respective accounts of the DTC participants for
Euroclear Bank S.A./N.V., as operator of the Euroclear System ("EUROCLEAR"), and
Clearstream Banking S.A. ("CLEARSTREAM, LUXEMBOURG") and registered in the name
of Cede & Co., as nominee for DTC. The Company will deliver against payment of
the purchase price the Offered Securities to be purchased by each Purchaser
hereunder and to be offered and sold by each Purchaser in reliance on Rule 144A
under the Securities Act (the "144A SECURITIES") in the form of one permanent
global security in definitive form without interest coupons (the "RESTRICTED
GLOBAL SECURITIES") deposited with the Trustee as custodian for DTC and
registered in the name of Cede & Co., as nominee for DTC. The Regulation S
Global Securities and the Restricted Global Securities shall be assigned
separate CUSIP numbers and shall include the legend regarding restrictions on
transfer set forth under "Transfer Restrictions" in the Offering Document. Until
the termination of the restricted period (as defined in Regulation S) with
respect to the offering of the Offered Securities, interests in the Regulation S
Global Securities may only be held by the DTC participants for Euroclear and
Clearstream, Luxembourg. Interests in any permanent global Securities will be
held only in book-entry form through Euroclear, Clearstream, Luxembourg or DTC,
as the case may be, except in the limited circumstances described in the
Offering Document.
Payment for the Regulation S Securities and the 144A Securities shall
be made by the Purchasers in Federal (same day) funds by wire transfer to an
account at a bank acceptable to CSFBC to the order of the Company at the New
York office of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP at 9:00 A.M., (New York
time), on December 21, 2001, or at such other time not later than seven full
business days thereafter as CSFBC and the Company determine, such time being
herein referred to as the "CLOSING DATE", against delivery to the Trustee as
custodian for DTC of (i) the Regulation S Global Securities representing all of
the Regulation S Securities for the respective accounts of the DTC participants
for Euroclear and Clearstream, Luxembourg and (ii) the Restricted Global
Securities representing all of the 144A Securities. The Regulation S Global
Securities and the Restricted Global Securities will be made available for
checking at the above office of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP at
least 24 hours prior to the Closing Date.
4. Representations by Purchasers; Resale by Purchasers.
(a) Each Purchaser severally represents and warrants to the
Company that it is an "accredited investor" within the meaning of
Regulation D under the Securities Act.
(b) Each Purchaser severally acknowledges that the Offered
Securities have not been registered under the Securities Act and may
not be offered or sold within the United States or to, or for the
account or benefit of, U.S. persons except in accordance with
Regulation S or pursuant to an exemption from the registration
requirements of the Securities Act. Each Purchaser severally
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represents and agrees that it has offered and sold the Offered
Securities, and will offer and sell the Offered Securities (i) as part
of its distribution at any time and (ii) otherwise until 40 days after
the later of the commencement of the offering and the Closing Date,
only in accordance with Rule 903 or Rule 144A under the Securities Act
("RULE 144A"). Accordingly, neither such Purchaser nor its affiliates,
nor any persons acting on its or their behalf, have engaged or will
engage in any directed selling efforts with respect to the Offered
Securities, and such Purchaser, its affiliates and all persons acting
on its or their behalf have complied and will comply with the offering
restrictions requirement of Regulation S. Each Purchaser severally
agrees that, at or prior to confirmation of sale of the Offered
Securities, other than a sale pursuant to Rule 144A, such Purchaser
will have sent to each distributor, dealer or person receiving a
selling concession, fee or other remuneration that purchases the
Offered Securities 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 (the "Securities Act") and may
not be offered or 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 date of the commencement of the offering and
the closing date, except in either case in accordance with
Regulation S (or Rule 144A if available) under the Securities
Act. Terms used above have the meanings given to them by
Regulation S."
Terms used in this subsection (b) have the meanings given to them by
Regulation S.
(c) Each Purchaser severally agrees that it and each of its
affiliates has not entered and will not enter into any contractual
arrangement with respect to the distribution of the Offered Securities
except for any such arrangements with the other Purchasers or
affiliates of the other Purchasers with the prior written consent of
the Company.
(d) Each Purchaser severally agrees that it and each of its
affiliates will not offer or sell the Offered Securities in the United
States by means of any form of general solicitation or general
advertising within the meaning of Rule 502(c) under the Securities Act,
including, but not limited to (i) any advertisement, article, notice or
other communication published in any newspaper, magazine or similar
media or broadcast over television or radio, or (ii) any seminar or
meeting whose attendees have been invited by any general solicitation
or general advertising. Each Purchaser severally agrees, with respect
to resales made in reliance on Rule 144A of any of the Offered
Securities, to deliver either with the confirmation of such resale or
otherwise prior to settlement of such resale a notice to the effect
that the resale of such Offered Securities has been made in reliance
upon the exemption from the registration requirements of the Securities
Act provided by Rule 144A.
(e) Each of the Purchasers severally represents and agrees
that (i) it has not offered or sold and prior to the date six months
after the date of issue of the Offered Securities will not offer or
sell any Offered Securities to persons in the United Kingdom except to
persons whose ordinary activities involve them in acquiring, holding,
managing or disposing of investments (as principal or agent) for the
purposes of their businesses or otherwise in circumstances which have
not resulted and will not result in an offer to the public in the
United Kingdom within the meaning of the Public Offers of Securities
Regulations 1995; (ii) it has complied and will comply with all
applicable provisions of the Financial Services Xxx 0000 with respect
to anything done by it in relation to the Offered Securities in, from
or otherwise involving the United Kingdom; and (iii) it 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 issue of the Offered
Securities to a person who is of a kind described in Article 11(3) of
the Financial Services Xxx 0000 (Investment Advertisements)
(Exemptions) Order 1996 or is a person to whom such document may
otherwise lawfully be issued or passed on.
5. Certain Agreements of the Company and the Guarantors. The Company
and each of the Guarantors agrees with the several Purchasers that:
9
(a) The Company will advise CSFBC promptly of any proposal to
amend or supplement the Offering Document and will not effect such
amendment or supplementation without CSFBC's consent (which will not be
unreasonably withheld) until the offering of the Offered Securities is
complete. If, at any time prior to the completion of the resale of the
Offered Securities by the Purchasers, any event occurs as a result of
which the Offering Document as then amended or supplemented would
include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading,
or if it is necessary at any such time to amend or supplement the
Offering Document to comply with any applicable law, the Company
promptly will notify CSFBC of such event and promptly will prepare, at
its own expense, an amendment or supplement which will correct such
statement or omission or effect such compliance. Neither CSFBC's
consent to, nor the Purchasers' delivery to offerees or investors of,
any such amendment or supplement shall constitute a waiver of any of
the conditions set forth in Section 6.
(b) The Company will furnish to CSFBC copies of any
preliminary offering circular, the Offering Document and all amendments
and supplements to such documents, in each case as soon as available
and in such quantities as CSFBC requests, and the Company will furnish
to CSFBC on the date hereof three copies of the Offering Document
signed by a duly authorized officer of the Company. At any time when
the Company is not subject to Section 13 or 15(d) of the Exchange Act,
the Company will promptly furnish or cause to be furnished to CSFBC
(and, upon request, to each of the other Purchasers) and, upon request
of holders and prospective purchasers of the Offered Securities, to
such holders and purchasers, copies of the information required to be
delivered to holders and prospective purchasers of the Offered
Securities pursuant to Rule 144A(d)(4) under the Securities Act (or any
successor provision thereto) in order to permit compliance with Rule
144A in connection with resales by such holders of the Offered
Securities. The Company will pay the expenses of printing and
distributing to the Purchasers all such documents.
(c) The Company and the Guarantors will arrange for the
qualification of the Offered Securities and the Guarantees for sale and
the determination of their eligibility for investment under the laws of
such jurisdictions in the United States and Canada as CSFBC designates
and will continue such qualifications in effect so long as required for
the resale of the Offered Securities by the Purchasers, provided that
the Company will not be required to qualify as a foreign corporation or
to file a general consent to service of process in any such state.
(d) During the period of five years hereafter, the Company and
CSK will furnish to CSFBC and, upon request, to each of the other
Purchasers, as soon as practicable after the end of each fiscal year, a
copy of its annual report to stockholders for such year; and the
Company and CSK will furnish to CSFBC and, upon request, to each of the
other Purchasers (i) as soon as available, a copy of each report and
any definitive proxy statement of the Company and CSK filed with the
Commission under the Exchange Act or mailed to stockholders, and (ii)
from time to time, such other information concerning the Company and
CSK as CSFBC may reasonably request.
(e) During the period of two years after the Closing Date, the
Company will, upon request, furnish to CSFBC, each of the other
Purchasers and any holder of Offered Securities a copy of the
restrictions on transfer applicable to the Offered Securities.
(f) During the period of two years after the Closing Date,
neither the Company nor CSK will, and will not permit any of its
affiliates (as defined in Rule 144 under the Securities Act) to, resell
any of the Offered Securities that have been reacquired by any of them.
(g) During the period of two years after the Closing Date,
neither the Company nor CSK will be or become, an open-end investment
company, unit investment trust or face-amount certificate company that
is or is required to be registered under Section 8 of the Investment
Company Act.
10
(h) Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, the Company
will pay all expenses incidental to the performance of its obligations
under this Agreement, the Indenture and the Registration Rights
Agreement, including (i) the fees and expenses of the Trustee and its
professional advisers; (ii) all expenses in connection with the
execution, issue, authentication, packaging and initial delivery of the
Offered Securities, the Guarantees and, as applicable, the Exchange
Securities, the preparation and printing of this Agreement, the
Registration Rights Agreement, the Offered Securities, the Guarantees,
the Indenture, the Offering Document and amendments and supplements
thereto, and any other document relating to the issuance, offer, sale
and delivery of the Offered Securities, the Guarantees and as
applicable, the Exchange Securities; (iii) the cost of qualifying the
Offered Securities and the Guarantees for trading in The PortalSM
Market ("PORTAL") and any expenses incidental thereto; (iv) the cost of
any advertising approved by the Company in connection with the issue of
the Offered Securities; (v) for any expenses (including fees and
disbursements of counsel) incurred in connection with qualification of
the Offered Securities, the Guarantees or the Exchange Securities for
sale under the laws of such jurisdictions in the United States and
Canada as CSFBC designates and the printing of memoranda relating
thereto; (vi) for any fees charged by investment rating agencies for
the rating of the Offered Securities or the Exchange Securities, and
(vi) for expenses incurred in distributing preliminary offering
circulars and the Offering Document (including any amendments and
supplements thereto) to the Purchasers. The Company will also pay or
reimburse the Purchasers (to the extent incurred by them) for all
travel expenses of the Purchasers and the Company's officers and
employees and any other expenses of the Purchasers and the Company in
connection with attending or hosting meetings with prospective
purchasers of the Offered Securities from the Purchasers.
(i) In connection with the offering, until CSFBC shall have
notified the Company and the other Purchasers of the completion of the
resale of the Offered Securities, neither the Company nor any of its
affiliates has or will, either alone or with one or more other persons,
bid for or purchase for any account in which it or any of its
affiliates has a beneficial interest any Offered Securities or attempt
to induce any person to purchase any Offered Securities; and neither it
nor any of its affiliates will make bids or purchases for the purpose
of creating actual, or apparent, active trading in, or of raising the
price of, the Offered Securities.
(j) Except for the sale by the Company of the Convertible
Debentures (as defined below), from the date hereof through the Closing
Date, each of the Company and the Guarantors will not offer, sell,
contract to sell, pledge or otherwise dispose of, directly or
indirectly, any United States dollar-denominated debt securities issued
or guaranteed by the Company or any Guarantor and having a maturity of
more than one year from the date of issue of the Offered Securities.
Each of the Company and the Guarantors will not at any time offer,
sell, contract to sell, pledge or otherwise dispose of, directly or
indirectly, any securities under circumstances where such offer, sale,
pledge, contract or disposition would cause the exemption afforded by
Section 4(2) of the Securities Act or the safe harbor of Regulation S
thereunder to cease to be applicable to the offer and sale of the
Offered Securities.
(k) The Company and the Guarantors will use their respective
best efforts to effect the inclusion of the Offered Securities and the
Subsidiary Guarantees in PORTAL and to maintain the listing of the
Offered Securities and the Subsidiary Guarantees on PORTAL for so long
as the Offered Securities are outstanding.
(l) The Company and the Guarantors will obtain the approval of
DTC for "book-entry" transfer of the Offered Securities and the
Subsidiary Guarantees and will comply with all of their respective
agreements set forth in the representation letters of the Company and
the Guarantors to DTC relating to the approval of the Offered
Securities and the Subsidiary Guarantees by DTC for "book-entry"
transfer.
11
(m) Neither the Company nor any Guarantor will voluntarily
claim, and each will actively resist any attempts to claim, the benefit
of any usury laws against the holders of any Offered Securities and the
related Subsidiary Guarantees.
(n) The Company and the Guarantors will comply with all of
their respective agreements set forth in the Registration Rights
Agreement.
(o) The Company and the Guarantors will use their respective
best efforts to do and perform all things required or necessary to be
done and performed under this Agreement by them prior to the Closing
Date and to satisfy all conditions precedent to the delivery of the
Offered Securities and the Subsidiary Guarantees.
(p) CSK will use its best efforts to cause the holders of its
7% convertible subordinated debentures due December 2006 (the
"CONVERTIBLE DEBENTURES") to fully convert such Convertible Debentures
into shares of CSK common stock as promptly as practicable following
the Closing Date.
6. Conditions of the Obligations of the Purchasers. The obligations of
the several Purchasers to purchase and pay for the Offered Securities will be
subject to the accuracy of the representations and warranties on the part of the
Company and the Guarantors herein, to the accuracy of the statements of officers
of the Company and the Guarantors made pursuant to the provisions hereof, to the
performance by the Company and the Guarantors of their obligations hereunder and
to the following additional conditions precedent:
(a) The Purchasers shall have received a letter, dated the
date of this Agreement, from PricewaterhouseCoopers LLP in agreed form
confirming that they are independent public accountants within the
meaning of the Securities Act and the applicable published rules and
regulations thereunder ("RULES AND REGULATIONS") and to the effect
that:
(i) in their opinion the financial statements
examined by them and included in the Offering Document and in
the Exchange Act Reports comply as to form in all material
respects with the applicable accounting requirements of the
Securities Act and the related published Rules and
Regulations;
(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 Offering Document and in the Exchange Act Reports;
(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 specified procedures, nothing
came to their attention that caused them to believe that:
(A) the unaudited financial statements
included in the Offering Document or in the Exchange
Act Reports do not comply as to form in all material
respects with the applicable accounting requirements
of the Securities 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 and its consolidated subsidiaries or,
at the date of the latest available balance sheet
read by such accountants, there was any decrease in
consolidated net current assets or net
12
assets, as compared with amounts shown on the latest
balance sheet included in the Offering Document; or
(C) for the period from the closing date of
the latest income statement included in the Offering
Document 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, net operating income, consolidated 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 Offering Document
discloses have occurred or may occur or which are described in
such letter; and
(iv) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other
financial information contained in the Offering Document and
the Exchange Act Reports (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
and its subsidiaries 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, except as
otherwise specified in such letter.
(b) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) a change in U.S. or
international financial political or economic conditions or currency
exchange rates or exchange controls as would, in the judgment of CSFBC,
be likely to prejudice materially the success of the proposed issue,
sale or distribution of the Offered Securities, whether in the primary
market or in respect of dealings in the secondary market, or (ii) (A)
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 and its subsidiaries which, in the
judgment of a majority in interest of the Purchasers including CSFBC,
is material and adverse and makes it impractical or inadvisable to
proceed with completion of the offering or the sale of and payment for
the Offered Securities; (B) 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
Securities 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) or any announcement that the Company has been placed on
negative outlook; (C) 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; (D) any banking moratorium declared by U.S.
Federal or New York authorities; or (E) any disruption of settlement of
securities; or (F) any attack on, outbreak or escalation of hostilities
or act of terrorism involving the United States, any declaration of war
by Congress or any other substantial national or international calamity
or emergency if, in the judgment of a majority in interest of the
Purchasers including CSFBC, the effect of any such attack, outbreak,
escalation, act, declaration, calamity or emergency makes it
impractical or inadvisable to proceed with completion of the offering
or sale of and payment for the Offered Securities.
(c) The Purchasers shall have received an opinion, dated the
Closing Date, from the office of the General Counsel to the Company and
the Guarantors, that:
(i) The Company has been duly incorporated and is a
validly existing corporation in good standing under the laws
of the State of Arizona, with corporate power
13
and authority to own its properties and conduct its business
as described in the Offering Document and to execute, deliver,
issue and sell the Offered Securities; and the Company 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 to the extent that the failure to be so
qualified or be in good standing would not have a Material
Adverse Effect.
(ii) All of the outstanding shares of capital stock
of the Company have been duly authorized and validly issued
and are fully paid and non-assessable.
(iii) Each of the Guarantors is a validly existing
corporation in good standing under the laws of the
jurisdiction of its incorporation, with corporate power and
authority to own its respective properties and conduct its
respective business as described in the Offering Document and
to execute and deliver the Guarantees; and each Guarantor 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 to the extent that the failure to be so
qualified or be in good standing would not have a Material
Adverse Effect. The capital stock of each Guarantor owned by
the Company, directly or through subsidiaries, is, to the
knowledge of such counsel, owned free from liens, encumbrances
and defects (other than the liens to secure the Company's
obligations under its new credit facility, all of which are
disclosed in the Offering Circular, and other liens that
individually or in the aggregate would not have a Material
Adverse Effect).
(iv) The Indenture has been duly authorized, executed
and delivered by the Company and each Guarantor; the Offered
Securities have been duly authorized, executed and delivered
by the Company and the Guarantee of each Guarantor has been
duly authorized, executed and delivered by such Guarantor.
(v) The Exchange Securities have been duly
authorized, executed and delivered by the Company and the
Guarantee to be endorsed on the Exchange Securities by each
Guarantor has been duly authorized, executed and delivered by
such Guarantor.
(vi) This Agreement and the Registration Rights
Agreement have each been duly authorized, executed and
delivered by the Company and each of the Guarantors.
(vii) There are no pending actions, suits or
proceedings against the Company, any of its Guarantors or any
of their respective properties that would reasonably be
expected, individually or in the aggregate, to have a Material
Adverse Effect, or materially and adversely affect the ability
of the Company to perform its obligations under the Indenture,
this Agreement or the Registration Rights Agreement; and, to
such counsel's knowledge, no such actions, suits or
proceedings are threatened.
(viii) The execution, delivery and performance by the
Company and each Guarantor of the Indenture, this Agreement
and the Registration Rights Agreement to which it is a party,
and the issuance and sale of the Offered Securities and the
Guarantees in compliance with the terms and provisions hereof
and thereof, will not require any consent, authorization,
filing with or approval of any governmental authority or
regulatory body of the State of Arizona under any law or
regulation of the State of Arizona applicable to the Company
or such Guarantor that, in our experience, is generally
applicable to transactions in the nature of those contemplated
by this Agreement, except for such filings or approvals that,
if not made or obtained, would not have a Material Adverse
Effect. We are expressing no opinion in this paragraph
regarding the federal or any state securities laws.
(ix) The execution, delivery and performance by the
Company and each Guarantor of the Indenture, this Agreement,
the Registration Rights Agreement and the
14
issuance and sale of the Offered Securities and the Guarantees
in compliance with the terms and provisions hereof and
thereof, will not (A) result in a breach or violation of any
of the terms and provisions of, or constitute a default under,
(i) any law or regulation of the State of Arizona applicable
to the Company or such Guarantor that, in our experience, is
generally applicable to transactions in the nature of those
contemplated by this Agreement, (ii) based solely upon review
of the orders, judgments or decrees identified to us in an
Officers' Certificate as constituting all orders, judgments or
decrees binding on the Company or any Guarantor, which are
listed in Schedule B to the opinion, any order, judgment or
decree of any court or other agency of government binding on
the Company or any Guarantor, (iii) based solely upon review
of the documents identified to me in an Officers' Certificate
as constituting all material contracts of the Company or any
Guarantor, which are listed in Schedule C to the opinion and
include, at a minimum, those Exhibits filed with CSK's most
recent Form 10-K, any exhibits filed by CSK with any
subsequent SEC filings and the new $300.0 million senior
secured credit facility entered into by the Company and the
purchase agreement, registration rights agreement and voting
agreement entered into by CSK in connection with the issuance
by CSK of the Convertible Debentures and the Convertible
Debentures and warrants issued in connection therewith (each a
"MATERIAL CONTRACT"), any Material Contract or (iv) the
charter or bylaws of the Company or any Guarantor, or (B)
result in or require the creation or imposition of any lien or
encumbrance upon any assets of the Company or any Guarantor
under any Material Contract. We are expressing no opinion in
this paragraph regarding the federal or any state securities
laws.
(d) The Purchasers shall have received an opinion, dated the
Closing Date, of Xxxxxx, Xxxx & Xxxxxxxx LLP, counsel for the Company and the
Guarantors, that:
(i) The Offered Securities conform in all material
respects to the description thereof contained in the Offering
Circular.
(ii) The Indenture constitutes, and the Offered
Securities, when executed and authenticated in accordance with
the provisions of the Indenture and delivered, and paid for by
the Purchasers in accordance with the terms of this Agreement,
will constitute, legal, valid and binding obligations of the
Company enforceable against the Company in accordance with
their terms.
(iii) The Guarantees of each Guarantor conform in all
material respects to the description thereof contained in the
Offering Circular.
(iv) When the Offered Securities and the Guarantees
have been executed and authenticated in accordance with the
provisions of the Indenture and delivered, and paid for by the
Purchasers in accordance with the terms of this Agreement, the
Guarantees will constitute legal, valid and binding
obligations of such Guarantor, enforceable against it in
accordance with their terms.
(v) When the Exchange Securities have been issued,
executed and authenticated in accordance with the terms of the
Exchange Offer and the Indenture in exchange for the Offered
Securities, the Exchange Securities will be entitled to the
benefits of the Indenture and the Exchange Securities will
constitute legal, valid and binding obligations of the
Company, enforceable against the Company in accordance with
their terms.
(vi) When the Exchange Securities (and the Guarantees
to be endorsed thereon) have been issued, executed and
authenticated in accordance with the terms of the Exchange
Offer and the Indenture in exchange for the Offered
Securities, the Guarantee of each Guarantor endorsed thereon
will constitute legal, valid and binding obligations of such
Guarantor, enforceable against it in accordance with its
terms.
15
(vii) The Registration Rights Agreement is a legal,
valid and binding obligation of the Company and each of the
Guarantors, enforceable against the Company and each Guarantor
in accordance with its terms.
(viii) The Company is not, and after giving effect to
the offering and sale of the Offered Securities and the
application of the proceeds thereof as described in the
Offering Circular the Company will not be, required to
register as an "investment company" as defined in the
Investment Company Act.
(ix) The execution, delivery and performance by the
Company and each Guarantor of the Indenture, this Agreement
and the Registration Rights Agreement to which it is a party,
and the issuance and sale of the Offered Securities and the
Guarantees in compliance with the terms and provisions hereof
and thereof, will not require any consent, authorization,
filing with or approval of any governmental authority or
regulatory body of the State of New York or the United States
of America under any law or regulation of the State of New
York or the United States of America applicable to the Company
or such Guarantor that, in our experience, is generally
applicable to transactions in the nature of those contemplated
by this Agreement, except for such filings or approvals that,
if not made or obtained, would not have a Material Adverse
Effect. We are expressing no opinion in this paragraph
regarding the federal or any state securities laws.
(x) The execution, delivery and performance by the
Company and each Guarantor of the Indenture, this Agreement,
the Registration Rights Agreement to which it is a party, and
the issuance and sale of the Offered Securities and the
Guarantees in compliance with the terms and provisions hereof
and thereof, will not (A) result in a breach or violation of
any of the terms and provisions of, or constitute a default
under, (i) any law or regulation of the State of New York or
the United States of America applicable to the Company or such
Guarantor that, in our experience, is generally applicable to
transactions in the nature of those contemplated by this
Agreement, (ii) based solely upon review of the orders,
judgments or decrees identified to us in an Officers'
Certificate as constituting all orders, judgments or decrees
binding on the Company or any Guarantor, which are listed in
Schedule B to the opinion, any order, judgment or decree of
any court or other agency of government binding on the Company
or any Guarantor or (iii) based solely upon review of the
Material Contracts, any Material Contract or (B) result in or
require the creation or imposition of any lien or encumbrance
upon any assets of the Company or any Guarantor under any
Material Contract. We are expressing no opinion in this
paragraph regarding the federal or any state securities laws.
(xi) No Material Contract grants any person the right
(1) except as disclosed in the Offering Circular, to require
the Company or such Guarantor to file a registration statement
under the Securities Act with respect to any securities of the
Company or such Guarantor or (2) to require the Company or
such Guarantor to include such securities with the Securities
and Guarantees registered pursuant to any Registration
Statement.
(xii) Assuming the accuracy of the representations
and warranties of the Purchasers and compliance by them with
their agreements contained in the Purchase Agreement, no
registration of the Offered Securities under the Securities
Act, and no qualification of the Indenture under the Trust
Indenture Act of 1939, as amended, is required for (1) the
offer, sale and delivery of the Offered Securities by the
Company to the several Purchasers pursuant to this Agreement
on the date hereof or (2) the resales of the Offered
Securities by the several Purchasers in the manner
contemplated by this Agreement, it being understood that we
express no opinion as to any subsequent resale of the Offered
Securities.
(xiii) The statements in the Offering Circular under
the caption "Certain United States Federal Income Tax
Consequences," insofar as such statements constitute a summary
16
of the United States federal tax laws referred to therein, are
accurate and fairly summarize in all material respects the
United States federal tax laws referred to therein.
Such counsel shall state that (A) they have participated in conferences
with officers and other representatives of the Company, representatives of the
independent auditors of the Company and representatives of the Purchasers at
which the contents of the Offering Circular and related matters were discussed,
(B) because the purpose of their professional engagement was not to establish or
confirm factual matters and because the scope of our examination of the affairs
of the Company and the Guarantors did not permit us to verify the accuracy,
completeness or fairness of the statements set forth in the Offering Circular,
such counsel are not passing upon and do not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the Offering
Circular except to the extent set forth in paragraphs (i), (iii) and (xiii)
above and (C) on the basis of the foregoing, and except for the financial
statements and schedules and other financial data included therein as to which
we express no such belief, no facts have come to our attention that lead us to
believe that the Offering Circular, as of the date thereof and as of the date
hereof contained or contains an untrue statement of a material fact or omitted
or omits to state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
(e) The Purchasers shall have received from Skadden, Arps,
Slate, Xxxxxxx & Xxxx LLP, counsel for the Purchasers, such opinion or
opinions, dated the Closing Date, with respect to the incorporation of
the Company, the validity of the Offered Securities, the Offering
Circular, the exemption from registration for the offer and sale of the
Offered Securities by the Company to the several Purchasers and the
resales by the several Purchasers as contemplated hereby and other
related matters as CSFBC may require, and the Company shall have
furnished to such counsel such documents as they request for the
purpose of enabling them to pass upon such matters.
(f) The Purchasers 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 and each
Guarantor in which such officers, to the best of their knowledge after
reasonable investigation, shall state that the representations and
warranties of the Company and the Guarantors in this Agreement are true
and correct in all material respects (except for those representations
and warranties that are already qualified as to materiality, in which
case such representations and warranties shall be true in all
respects), that the Company and the Guarantors have complied with all
agreements and satisfied all conditions on its part to be performed or
satisfied hereunder at or prior to the Closing Date, and that,
subsequent to the respective dates of the most recent financial
statements in the Offering Document 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 the Guarantors
taken as a whole except as set forth in or contemplated by the Offering
Document or as described in such certificate.
(g) The Purchasers shall have received a letter, dated the
Closing Date, of PricewaterhouseCoopers 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.
(h) The Company shall have entered into a new $300.0 million
senior secured credit facility on terms substantially similar to the
terms described in the Offering Circular, the cash proceeds of which
shall be used to repay indebtedness outstanding under the Third Amended
and Restated Credit Agreement, dated as of September 30, 1999, as
amended, among the Company, The Chase Manhattan Bank, DLJ Capital
Funding, Inc., Xxxxxx Commercial Paper Inc. and the lenders referred to
therein (the "EXISTING CREDIT AGREEMENT"). The Company shall deliver
true and correct, fully executed copies of such new credit facility and
any related documents to the Purchasers on the Closing Date.
(i) CSK shall have issued at least $50.0 million of
Convertible Debentures on terms substantially similar to the terms
described in the Offering Circular, the net cash proceeds of which
17
shall be contributed to the Company and used to repay indebtedness
outstanding under the Existing Credit Agreement. The Company shall
deliver true and correct, fully executed copies of the Convertible
Debentures and any related documents to the Purchasers on the Closing
Date.
(j) CSK and the holders of a majority of the outstanding
common stock of CSK (including the shares of common stock issuable upon
conversion of CSK's 7% Convertible Subordinated Notes, dated August 14,
2001) shall have entered into an irrevocable voting agreement wherein
such stockholders shall have agreed to approve the issuance of the
common stock underlying the Convertible Debentures and any related
documents. The Company shall deliver true and correct, fully executed
copies of the voting agreement and any related documents to the
Purchasers on the Closing Date.
(k) CSK shall have irrevocably exercised its right to convert
all of the unpaid principal amount of 7% Convertible Subordinated
Notes, dated August 14, 2001, into shares of CSK common stock.
The Company will furnish the Purchasers with such conformed copies of
such opinions, certificates, letters and documents as the Purchasers reasonably
request. CSFBC may in its sole discretion waive on behalf of the Purchasers
compliance with any conditions to the obligations of the Purchasers hereunder.
7. Indemnification and Contribution.
(a) The Company will indemnify and hold harmless each
Purchaser, its partners, directors and officers and each person, if
any, who controls such Purchaser within the meaning of Section 15 of
the Securities Act, against any losses, claims, damages or liabilities,
joint or several, to which such Purchaser may become subject, under the
Securities Act or the Exchange Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any breach of any of the representations
and warranties of the Company contained herein or any untrue statement
or alleged untrue statement of any material fact contained in the
Offering Document, or any amendment or supplement thereto, or any
related preliminary offering circular or the Exchange Act Reports, or
arise out of or are based upon the omission or alleged omission to
state therein a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading, including any losses, claims, damages or liabilities
arising out of or based upon the Company's failure to perform its
obligations under Section 5(a) of this Agreement, and will reimburse
each Purchaser for any legal or other expenses reasonably incurred by
such Purchaser 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 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 Purchaser through CSFBC specifically for use therein, it
being understood and agreed that the only such information consists of
the information described as such in subsection (b) below; provided
further, that the foregoing indemnity agreement with respect to any
Preliminary Offering Circular shall not inure to the benefit of any
Purchaser who failed to deliver an Offering Circular, as then amended
or supplemented (so long as the Offering Circular and any amendment or
supplement thereto was provided by the Company to the several
Purchasers in the requisite quantity and on a timely basis to permit
proper delivery on or prior to the Closing Date), to the person
asserting any losses, claims, damages, liabilities or judgments caused
by any untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Offering Circular, 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, if such material misstatement or omission or alleged
material misstatement or omission was cured in the Offering Circular,
as so amended or supplemented.
18
(b) Each Purchaser will severally and not jointly indemnify
and hold harmless the Company, its directors and officers and each
person, if any, who controls the Company within the meaning of Section
15 of the Securities Act, against any losses, claims, damages or
liabilities to which the Company may become subject, under the
Securities Act or the Exchange 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 the Offering Document, or
any amendment or supplement thereto, or any related preliminary
offering circular, or arise out of or are based upon the omission or
the alleged omission to state therein a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, 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
Purchaser 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 Purchaser consists of the following information in the Offering
Document furnished on behalf of each Purchaser: under the caption "Plan
of Distribution," the third sentence of paragraph nine and paragraph
eleven; provided, however, that the Purchasers shall not be liable for
any losses, claims, damages or liabilities arising out of or based upon
the Company's failure to perform its obligations under Section 5(a) of
this Agreement.
(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 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 7 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 and does not include a statement as to or an
admission of fault, culpability or failure to act by or on behalf of
any indemnified party.
(d) If the indemnification provided for in this Section 7 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 Purchasers on the other from the offering of the Offered
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 Purchasers 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 Purchasers 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 discounts and commissions
19
received by the Purchasers from the Company under this Agreement. 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 Purchasers 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
Purchaser shall be required to contribute any amount in excess of the
amount by which the total discounts, fees and commissions received by
such Purchaser exceeds the amount of any damages which such Purchaser
has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. The Purchasers'
obligations in this subsection (d) to contribute are several in
proportion to their respective purchase obligations and not joint.
(e) The obligations of the Company under this Section 7 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 Purchaser within the meaning of the Securities
Act or the Exchange Act; and the obligations of the Purchasers under
this Section shall be in addition to any liability which the respective
Purchasers may otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls the Company within the
meaning of the Securities Act or the Exchange Act.
8. Default of Purchasers. If any Purchaser or Purchasers default in
their obligations to purchase Offered Securities hereunder and the aggregate
principal amount of Offered Securities that such defaulting Purchaser or
Purchasers agreed but failed to purchase does not exceed 10% of the total
principal amount of Offered Securities, CSFBC may make arrangements satisfactory
to the Company for the purchase of such Offered Securities by other persons,
including any of the Purchasers, but if no such arrangements are made by the
Closing Date, the non-defaulting Purchasers shall be obligated severally, in
proportion to their respective commitments hereunder, to purchase the Offered
Securities that such defaulting Purchasers agreed but failed to purchase. If any
Purchaser or Purchasers so default and the aggregate principal amount of Offered
Securities with respect to which such default or defaults occur exceeds 10% of
the total principal amount of Offered Securities and arrangements satisfactory
to CSFBC and the Company for the purchase of such Offered 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-defaulting Purchaser or the
Company, except as provided in Section 9. As used in this Agreement, the term
"Purchaser" includes any person substituted for a Purchaser under this Section.
Nothing herein will relieve a defaulting Purchaser from liability for its
default.
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 Purchasers 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 Purchaser, the Company or any of their respective representatives,
officers or directors or any controlling person, and will survive delivery of
and payment for the Offered Securities. If this Agreement is terminated pursuant
to Section 8 or if for any reason the purchase of the Offered Securities by the
Purchasers 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 Purchasers pursuant to Section 7 shall remain
in effect. If the purchase of the Offered Securities by the Purchasers 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 (C), (D) or (E) of Section 6(b)(ii), the Company will reimburse the
Purchasers for all out-of-pocket expenses (including fees and disbursements of
counsel) reasonably incurred by them in connection with the offering of the
Offered Securities.
10. Notices. All communications hereunder will be in writing and, if
sent to the Purchasers will be mailed, delivered or telegraphed and confirmed to
the Purchasers, c/o Credit Suisse First Boston
20
Corporation, Eleven Madison Avenue, New York, N.Y. 10010-3629,
Attention: Investment Banking Department - Transactions Advisory Group,
or, if sent to the Company or the Guarantors, will be mailed, delivered
or telegraphed and confirmed to it at CSK Auto, Inc., 000 Xxxx Xxxxxxxx
Xxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx 00000, Attention: Chief Financial
Officer; provided, however, that any notice to a Purchaser pursuant to
Section 7 will be mailed, delivered or telegraphed and confirmed to
such Purchaser.
11. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
controlling persons referred to in Section 7, and no other person will have any
right or obligation hereunder, except that holders of Offered Securities shall
be entitled to enforce the agreements for their benefit contained in the second
and third sentences of Section 5(b) hereof against the Company as if such
holders were parties thereto.
12. Representation of Purchasers. You will act for the several
Purchasers in connection with this purchase, and any action under this Agreement
taken by you jointly or by CSFBC will be binding upon all the Purchasers.
13. 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.
14. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK INCLUDING, WITHOUT
LIMITATION, SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW
AND NEW YORK CIVIL PRACTICE LAWS AND RULES 327(b).
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.
21
If the foregoing is in accordance with the Purchasers' understanding of
our agreement, kindly sign and return to us one of the counterparts hereof,
whereupon it will become a binding agreement between the Company and the several
Purchasers in accordance with its terms.
Very truly yours,
ISSUER
CSK AUTO, INC.
BY /s/ Xxx X. Xxxxxx
Name: Xxx X. Xxxxxx
Title: Senior Vice President
GUARANTORS
CSK AUTO CORPORATION
BY /s/ Xxx X. Xxxxxx
Name: Xxx X. Xxxxxx
Title: Senior Vice President
AUTOMOTIVE INFORMATION SYSTEMS, INC.
BY /s/ Xxx X. Xxxxxx
Name: Xxx X. Xxxxxx
Title: Senior Vice President
CSK XXXX.XXX, INC.
BY /s/ Xxx X. Xxxxxx
Name: Xxx X. Xxxxxx
Title: Senior Vice President
The foregoing Purchase Agreement
is hereby confirmed and accepted
as of the date first above written.
CREDIT SUISSE FIRST BOSTON CORPORATION
X.X. XXXXXX SECURITIES INC.
UBS WARBURG LLC,
As Representatives of the Several Purchasers,
c/o Credit Suisse First Boston Corporation,
Eleven Madison Avenue,
New York, N.Y. 10010-3629
By CREDIT SUISSE FIRST BOSTON CORPORATION
By /s/ Xxxxx Xxxxxxxxx
Name: Xxxxx Xxxxxxxxx
Title: Director
22
SCHEDULE A
PRINCIPAL AMOUNT OF
PURCHASER OFFERED SECURITIES
--------- ------------------
Credit Suisse First Boston Corporation................. $ 93,333,334
X.X. Xxxxxx Securities Inc............................. 93,333,333
UBS Warburg LLC........................................ 93,333,333
------------
Total........................ $280,000,000
============
23
SCHEDULE B
Subsidiaries
Automotive Information Systems, Inc.
XXXXXXX.XXX, Inc.
24
EXHIBIT I
Form of Registration Rights Agreement
25
