EXHIBIT 1.1
$150,000,000
X.X. XXXXXX, INC.
8 3/8% Senior Notes due 2004
UNDERWRITING AGREEMENT
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June 4, 1997
XXXXXXXXX, LUFKIN & XXXXXXXX
SECURITIES CORPORATION
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
X.X. Xxxxxx, Inc., a Delaware corporation (the "Company"), proposes to
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issue and sell $150,000,000 aggregate principal amount of its 8 3/8% Senior
Notes due 2004 (the "Notes") Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
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Corporation(the "Underwriter"). The Notes are to be issued pursuant to the
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provisions of an Indenture to be dated as of June 9, 1997, as amended and
supplemented by a First Supplemental Indenture dated as of June 9, 1997 (the
"Indenture"), among the Company, the subsidiaries of the Company listed on the
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signature pages hereof (the "Guarantors") and the American Stock Transfer and
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Trust Company, as Trustee (the "Trustee"). The Company's obligations under the
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Indenture and the Notes will be unconditionally guaranteed (the "Guarantees"),
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jointly and severally, by each of the Guarantors. The Company and the
Guarantors are collectively referred to herein as the "Issuers," and the Notes
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and the Guarantees are collectively referred to herein as the "Securities."
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1. Registration Statement and Prospectus. The Company has prepared and
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filed with the Securities and Exchange Commission (the "Commission") in
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accordance with the provisions of the Securities Act of 1933, as amended, and
the published rules and regulations of the Commission thereunder (collectively,
the "Act"), a registration statement on Form S-3 (No.333-27521), including a
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base prospectus relating to the Securities. The registration statement as
amended at the time it became effective on June 3, 1997, including information
(if any) deemed to be part of the registration statement at the
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time of effectiveness pursuant to Rule 430A under the Act, is hereinafter
referred to as the "Registration Statement"; and the base prospectus dated June
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3, 1997 (the "Base Prospectus"), as supplemented by the prospectus supplement
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relating to the Securities in the form first used to confirm sales of Notes (the
"Prospectus Supplement"), is hereinafter referred to as the "Prospectus." Any
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reference herein to the Registration Statement, a preliminary prospectus or the
Prospectus shall be deemed to refer to and include the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 under the Act, as of the
effective date of the Registration Statement or the date of such preliminary
prospectus or the Prospectus (the "Incorporated Documents"), and, except as
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otherwise indicated, when reference is made to information "in" (including by
use of the terms "set forth in," "described in" and similar terms) the
Prospectus or the Registration Statement, such reference shall be deemed to
include information incorporated by reference in the Prospectus or the
Registration Statement, as the case may be.
2. Agreements to Sell and Purchase. The Company agrees to issue and
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sell, and, on the basis of the representations and warranties contained in this
Underwriting Agreement (the "Agreement") and subject to its terms and
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conditions, the Underwriter agrees to purchase from the Company, all of the
Notes at 98.419% of the principal amount thereof (the "Purchase Price"), plus
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accrued interest thereon, if any, from June 9,1997 to the date of payment and
delivery.
3. Terms of Public Offering. The Issuers are advised by you that you
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propose to offer the Securities from time to time after the execution and
delivery of this Agreement for sale in one or more negotiated transactions or
otherwise, at market prices prevailing at the time of sale, at prices related to
such market prices or at negotiated prices, as set forth in the Prospectus.
4. Delivery and Payment. Delivery to the Underwriter of and payment for
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the Notes shall be made at 9:00 A.M., New York City time, on June 9, 1997 (the
"Closing Date"), at such place as you shall designate. The Closing Date and the
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location of delivery of and the form of payment for the Notes may be varied by
agreement between you and the Company.
Certificates for the Notes shall be registered in such names and
issued in such denominations as you shall request in writing not later than two
full business days prior to the Closing Date. Such certificates shall be made
available to
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you for inspection not later than 9:30 A.M., New York City time, on
the business day next preceding the Closing Date. Certificates in definitive
form evidencing the Notes shall be delivered to you on the Closing Date with any
transfer taxes thereon duly paid by the Company, for the account of the
Underwriter, against payment of the Purchase Price therefor by wire or certified
or official bank checks payable in Federal funds to the order of the Company.
If the Notes will be issued in book-entry form, the Company shall deposit the
global certificate(s) representing the Notes with the Depository Trust Company
("DTC"), or its designated custodian, at the Closing Date, and the Company will
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deliver such global certificate(s) to the Underwriter by causing DTC to credit
the Notes to the account of the Underwriter at DTC against payment therefor as
set forth above.
5. Agreements of the Issuers. The Issuers, jointly and severally,
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agree with the Underwriter as follows:
(a) The Issuers will, if necessary or required by law, file an
amendment to the Registration Statement or, if necessary pursuant to
Rule 430A under the Act, a post-effective amendment to the Registration
Statement, as soon as practicable after the execution and delivery of this
Agreement, and will use their best efforts to cause the Registration
Statement or such post-effective amendment to become effective at the
earliest possible time. The Company will comply fully and in a timely
manner with the applicable provisions of Rule 424 and Rule 430A under the
Act.
(b) The Issuers will advise you promptly and, if requested by you, will
confirm such advice in writing: (i) of the effectiveness of any amendment
to the Registration Statement; (ii) of the transmission to the Commission
for filing of any supplement to the Prospectus (including any document that
would as a result of such filing become an Incorporated Document) and to
furnish you with copies thereof; (iii) of the receipt of any comments from
the Commission that relate to the Registration Statement or of any request
by the Commission for amendment of or a supplement to the Registration
Statement or the Prospectus or for additional information; (iv) of the
issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or any order preventing or suspending the use
of the Prospectus or of the suspension of qualification of the Securities
for offering or sale in any jurisdiction or the initiation or the
threatening of
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any proceeding for such purpose; and (v) within the period of time referred
to in paragraph (e) below, of any change in the Company's condition
(financial or other), business, prospects, properties, net worth or results
of operations, or of the happening of any event, which makes any statement
of a material fact made in the Registration Statement or the Prospectus (as
then amended or supplemented) untrue or which requires the making of any
additions to or changes in the Registration Statement or the Prospectus (as
then amended or supplemented) in order to state a material fact required to
be stated therein or necessary in order to make the statements therein not
misleading, or of the necessity to amend or supplement the Prospectus (as
then amended or supplemented) to comply with the Act or any other law. If
at any time any stop order suspending the effectiveness of the Registration
Statement or any order preventing or suspending the use of the Prospectus
or suspending any such qualification shall be issued, the Issuers will
promptly use their best efforts to obtain the withdrawal of such order at
the earliest possible time.
(c) The Issuers will furnish to you, without charge, (i) five copies of
the registration statement as originally filed with the Commission and of
each amendment thereto, including all exhibits thereto, (ii) the Prospectus
and any amendment or supplement thereto, (iii) such number of copies of the
registration statement as originally filed and of each amendment thereto,
but without exhibits, as you may request, (iv) such number of copies of the
Incorporated Documents, without exhibits, as you may request, and (v) five
copies of the exhibits to the Incorporated Documents.
(d) The Issuers will not file any amendment to the Registration
Statement or make any amendment or supplement to the Prospectus or, prior
to the end of the period of time referred to in paragraph (e) below, file
any document which, upon filing becomes an Incorporated Document, of which
you shall not previously have been advised or to which, after you shall
have received a copy of the document proposed to be filed, you shall
reasonably object.
(e) As soon after the execution and delivery of this Agreement as
possible and thereafter from time to time for such period as in the opinion
of counsel for the Underwriter a prospectus is required by the Act to be
delivered in connection with sales by the Underwriter or any dealer, the
Issuers will expeditiously deliver to the Underwriter
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and each dealer, without charge, as many copies of the Prospectus (and of
any amendment or supplement thereto) as you may reasonably request. The
Issuers consent to the use of the Prospectus (and of any amendment or
supplement thereto) in accordance with the provisions of the Act and with
the securities or Blue Sky laws of the jurisdictions in which the
Securities are offered by the Underwriter and by all dealers to whom
Securities may be sold, both in connection with the offering and sale of
the Securities and for such period of time thereafter as the Prospectus is
required by the Act to be delivered in connection with sales by the
Underwriter or any dealer.
(f) If during the period of time referred to in paragraph (e) above any
event shall occur as a result of which, in the judgment of the Issuers or
in the opinion of counsel for the Underwriter, it becomes necessary to
amend or supplement the Prospectus in order to make the statements therein,
in the light of the circumstances when the Prospectus is delivered to a
purchaser, not misleading, or if it is necessary to amend or supplement the
Prospectus to comply with the Act or any other law, the Issuers will
forthwith prepare and, subject to the provisions of paragraph (d) above,
file with the Commission an appropriate amendment or supplement to the
Prospectus so that the statements in the Prospectus, as so amended or
supplemented, will not, in the light of the circumstances when it is so
delivered, be misleading, or so that the Prospectus will comply with law,
and to furnish to the Underwriter and to such dealers as you shall specify
such number of copies thereof as the Underwriter or such dealers may
reasonably request. In the event that the Issuers and you agree that the
Prospectus should be amended or supplemented, the Issuers, if requested by
you, will promptly issue a press release announcing or disclosing the
matters to be covered by the proposed amendment or supplement.
(g) The Issuers will cooperate with you and with counsel for the
Underwriter in connection with the registration or qualification of the
Securities for offering and sale by the Underwriter and by dealers under
the securities or Blue Sky laws of such jurisdictions as you may designate
and will file such consents to service of process or other documents
necessary or appropriate in order to effect such registration or
qualification; provided, however, that in no event shall any Issuer be
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obligated to qualify to do business in any jurisdiction where it is not now
so qualified or to take any action which would subject
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it to service of process in suits, other than those arising out of the
offering or sale of the Securities, in any jurisdiction where it is not now
so subject.
(h) The Issuers will make generally available to its security holders a
consolidated earnings statement, which need not be audited, covering a
twelve-month period commencing after the date the Registration Statement is
declared effective by the Commission (the "Effective Date") and ending not
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later than 15 months thereafter, as soon as practicable after the end of
such period, which consolidated earnings statement shall satisfy the
provisions of Section ll(a) of the Act and Rule 158 thereunder, and to
advise you in writing when such statement has been made available.
(i) During the period of five years hereafter, the Issuers will furnish
to you as soon as available, a copy of all public materials furnished by
the Company to its stockholders and all public reports and financial
statements furnished by the Company to the principal national securities
exchange upon which the Common Stock may be listed pursuant to requirements
of or agreements with such exchange or to the Commission.
(j) The Company will apply the net proceeds from the sale of the Notes
in accordance with the description set forth in the Prospectus under the
caption "Use of Proceeds."
(k) Neither the Company nor any of its subsidiaries has taken, or will
take, directly or indirectly, any action designed to or that might
reasonably be expected to cause or result in stabilization or manipulation
of the price of the Notes to facilitate the sale or resale of the Notes.
(l) The Issuers will pay all costs, expenses, fees and taxes incident
to (i) the preparation, printing, filing and distribution under the Act of
the Registration Statement (including financial statements and exhibits),
and all amendments and supplements thereto prior to or during the period
specified in paragraph (e) above, (ii) the printing and delivery of the
Prospectus and all amendments or supplements thereto during the period
specified in paragraph (e) above, (iii) the printing and delivery of this
Agreement, the Preliminary and Supplemental Blue Sky Memoranda and all
other agreements, memoranda, correspon-
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dence and other documents printed and delivered in connection with the
offering of the Securities (including in each case any disbursements of
counsel for the Underwriter relating to such printing and delivery), (iv)
the registration or qualification of the Securities for offer and sale
under the securities or Blue Sky laws of the several states (including in
each case the reasonable fees and disbursements of counsel for the
Underwriter relating to such registration or qualification and memoranda
relating thereto), (v) filings and clearance with the National Association
of Securities Dealers, Inc. in connection with the offering, (vi) the
listing, if any, of the Securities on any national securities exchange, and
(vii) furnishing such copies of the Registration Statement, the Prospectus
and all amendments and supplements thereto as may be requested for use in
connection with the offering or sale of the Securities by the Underwriter
or by dealers to whom Securities may be sold.
(m) The Issuers will not during the period beginning on the date hereof
and continuing to and including the Closing Date, offer, sell, contract to
sell or otherwise dispose of any debt securities of the Company or any
warrants, options or other rights to purchase or acquire debt securities of
the Company or any securities convertible into or exchangeable for debt
securities of the Company (other than (i) the Securities and (ii)
commercial paper issued in the ordinary course of business), without the
prior written consent of Xxxxxxxxx, Lufkin & Xxxxxxxx Securities
Corporation.
(n) The Issuers will use their best efforts to do and perform all
things required or necessary to be done and performed under this Agreement
by the Issuers prior to the Closing Date and to satisfy all conditions
precedent to the delivery of the Notes.
6. Representations and Warranties of the Issuers. The Issuers, jointly
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and severally, represent and warrant to the Underwriter that:
(a) Each preliminary prospectus included as part of the registration
statement as originally filed or as part of any amendment or supplement
thereto, or filed pursuant to Rule 424 under the Act, complied when so
filed in all material respects with the provisions of the Act. The
Commission has not issued any order preventing or suspending the use of any
preliminary prospectus.
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(b) The Registration Statement has become effective and at the date of
the Prospectus (if different), including at the date of any post-effective
amendment or supplement, the Registration Statement will comply in all
material respects with the provisions of the Act, and will not 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
not misleading; the Prospectus (and any supplements or amendments thereto)
will at all such times comply in all material respects with the provisions
of the Act and will not at any such time contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading; provided, however, that no representation or
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warranty is made as to information contained in or omitted from the
Registration Statement or the Prospectus in reliance upon and in conformity
with written information furnished to the Issuers with respect to the
Underwriter specifically for inclusion therein.
(c) The Incorporated Documents, at the time they were filed with the
Commission or, to the extent such documents were subsequently amended prior
to the date hereof, at the time so amended, complied in all material
respects with the requirements of the Act or the Securities Exchange Act of
1934, as amended, and the published rules and regulations of the Commission
thereunder (collectively, the "Exchange Act"), as applicable, and such
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documents do not on the date hereof and will not on the Closing Date
contain an untrue statement of a material fact and do not on the date
hereof and will not on the Closing Date omit to state a material fact
required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading.
(d) The financial statements (including the related notes and
supporting schedules) in the Registration Statement or the Prospectus
present fairly the consolidated financial position and results of
operations of the entities purported to be shown thereby, at the dates and
for the periods indicated, and have been prepared in conformity with
generally accepted accounting principles applied on a consistent basis
throughout the periods involved.
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(e) Ernst & Young, LLP, who have reported on the financial statements
of the Company, are independent public accountants with respect to the
Company and its subsidiaries as required by the Act. Wittington, McLemore,
Land, Xxxxx & White, P.C., who have reported on the financial statements of
S.C. Torrey Atlanta, Ltd. and Affiliates, are independent public
accountants with respect to the Company and its subsidiaries as required by
the Act.
(f) The pro forma financial statements and other pro forma financial
information (including the notes thereto) in the Prospectus have been
prepared in all material respects in accordance with applicable
requirements of Regulation S-X promulgated under the Exchange Act and have
been properly computed on the bases described therein. The material
assumptions used in the preparation of the pro forma financial statements
and other pro forma information in the Prospectus are set forth therein and
were reasonable when made, and the adjustments used therein are appropriate
to give pro forma effect to the transactions or circumstances referred to
therein.
(g) The Company and each of its subsidiaries have been duly formed and
are validly existing in good standing under the laws of their respective
jurisdictions of organization, are duly qualified to do business and are in
good standing in each jurisdiction in which their respective ownership or
lease of property or the conduct of their respective businesses requires
such qualification except where the failure to so qualify, singly or in the
aggregate, would not have a material adverse effect on the financial
condition, results of operations, business or prospects of the Company and
its subsidiaries taken as a whole (a "Material Adverse Effect"), and have
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all power and authority necessary to own or hold their respective
properties and to conduct the businesses in which they are engaged.
(h) The Company has an authorized capitalization as set forth in the
Prospectus; and all of the issued equity interests of each subsidiary of
the Company have been duly authorized and validly issued and, as to shares
of capital stock of any corporation constituting a subsidiary, are fully
paid and non-assessable and (except for directors' qualifying shares) are
owned directly or indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims other than restrictions on transfer
imposed by applicable securities laws.
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(i) The execution, delivery and performance of this Agreement, the
Indenture and the Securities by the Issuers, compliance by the Issuers of
all the provisions hereof and thereof and the consummation of the
transactions contemplated hereby will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or
other material agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries
is bound or to which any of the property or assets of the Company or any of
its subsidiaries is subject, nor will such actions result in any violation
of the provisions of the organizational documents of the Company or any of
its subsidiaries or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over the Company
or any of its subsidiaries or any of their property or assets; and except
for such consents, approvals, authorizations, registrations or
qualifications as may be required under the Act or applicable state or
foreign securities laws in connection with the purchase and distribution of
the Securities by the Underwriter, no consent, approval, authorization or
order of, or filing or registration with, any such court or governmental
agency or body is required for the execution, delivery and performance of
this Agreement, the Indenture and the Securities by the Issuers, compliance
by the Issuers of all the provisions hereof and thereof and the
consummation of the transactions contemplated hereby.
(j) This Agreement has been duly authorized, executed and delivered by
the Issuers and is a valid and binding agreement of the Issuers enforceable
in accordance with its terms (except as rights to indemnity and
contribution hereunder may be limited by applicable law).
(k) The Indenture has been duly qualified under the Trust Indenture Act
of 1939, as amended (the "TIA"), and has been duly authorized, executed and
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delivered by the Issuers and is a valid and binding agreement of the
Issuers, enforceable in accordance with its terms except as (i) the
enforceability thereof may be limited by bankruptcy, insolvency or similar
laws affecting creditors' rights generally and (ii) rights of acceleration
and the availability of equitable remedies may be limited by equitable
principles of general applicability.
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(l) The Notes have been duly authorized and, when executed and
authenticated in accordance with the provisions of the Indenture and
delivered to the Underwriter against payment therefor as provided by 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 except as (i) the enforceability thereof may be limited by
bankruptcy, insolvency or similar laws affecting creditors' rights
generally and (ii) rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general applicability.
(m) The Guarantees have been duly authorized and, upon endorsement on
the Notes by the Guarantors, execution and authentication of the Notes in
accordance with the provisions of the Indenture and delivery of the Notes
to the Underwriter against payment therefor as provided by this Agreement,
will be entitled to the benefits of the Indenture, and will be valid and
binding obligations of the Guarantors, enforceable in accordance with their
terms except as (i) the enforceability thereof may be limited by
bankruptcy, insolvency or similar laws affecting creditors' rights
generally and (ii) rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general applicability.
(n) The Securities and the Indenture conform to the description thereof
in the Prospectus.
(o) Neither the Company nor any of its subsidiaries has sustained,
since the date of the latest audited financial statements in the
Prospectus, any loss or interference with the business of the Company and
its subsidiaries taken as a whole from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, otherwise than as set forth
or contemplated in the Prospectus, resulting in a Material Adverse Effect;
and, since such date, there has not been any change in the capital stock or
long-term debt of the Company or any of its subsidiaries or any material
adverse change, or any development involving a prospective material adverse
change, in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of the Company and
its subsidiaries taken as a whole, otherwise than as set forth or
contemplated in the Prospectus.
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(p) Other than as granted to the former stockholders of The Torrey
Group of Companies and which are not applicable to the offering of the
Securities, there are no contracts, agreements or understandings between
the Company and any person granting such person the right to require the
Company to file a registration statement under the Act with respect to any
securities of the Company owned or to be owned by such person or to require
the Company to include such securities in the securities registered
pursuant to the Registration Statement or in any securities being
registered pursuant to any other registration statement filed by the
Company under the Act.
(q) The Company and its subsidiaries own the items of real property and
personal property purported to be owned by them which are material to the
conduct of the business of the Company and its subsidiaries taken as a
whole, free and clear of all liens, encumbrances and defects, except such
as are described in the Prospectus or such as would not have a Material
Adverse Effect. All real property held under lease by the Company and its
subsidiaries are held by them under valid, subsisting and enforceable
leases, with such exceptions as are described in the Prospectus or such as
would not have a Material Adverse Effect.
(r) Except as described in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property or assets of the Company
or any of its subsidiaries is the subject which are reasonably likely to
have a Material Adverse Effect; and to the Issuers' knowledge, no such
proceedings are threatened by governmental authorities or by others.
(s) The conditions for use of Form S-3, as set forth in the General
Instructions thereto, have been satisfied.
(t) To the Issuers' knowledge, all real property owned (either
presently or at any time in the past) or presently leased by the Company
and its subsidiaries in connection with the operation of their business,
including, without limitation, any subsurface soils and ground water
(collectively, the "Realty"), is free of contamination from any substance
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or material presently known to be toxic or hazardous, including, without
limitation, any radioactive substance, methane, volatile hydrocarbons or
industrial solvents (each a "Hazardous Substance"), which
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could reasonably be expected to materially impair the beneficial use
thereof by the Company and its subsidiaries or constitute or cause a
significant health, safety or other environmental hazard to occupants or
users (except for contaminations which would not have a Material Adverse
Effect); and to the Issuers' knowledge, the Realty does not contain any
underground storage or treatment tanks, active or abandoned water, gas or
oil xxxxx, or any other underground improvements or structures, other than
the foundations, footings or other supports for the improvements located
thereon, the presence of which would have a Material Adverse Effect.
Notwithstanding the foregoing, Hazardous Substances shall be deemed not to
include any supplies or substances maintained, used, stored or held on the
Realty which are (i) naturally occurring, (ii) installed by public
utilities or (iii) used in the ordinary course of the Company's or its
subsidiaries' business, provided that such supplies or substances are
stored, used, maintained and held in all material respects in accordance
with any applicable governmental requirements and with restrictions,
conditions and standards suggested by the manufacturer and the Company's
insurance carriers.
(u) The Company and its subsidiaries carry, or are covered by,
insurance in such amounts and covering such risks as is adequate for the
conduct of their respective businesses.
(v) The Company and its subsidiaries own or possess adequate rights to
use all material patents, patent applications, trademarks, service marks,
trade names, trademark registrations, service xxxx registrations,
copyrights and licenses necessary for the conduct of their respective
businesses the absence of which would have a Material Adverse Effect and
have no reason to believe that the conduct of their respective businesses
will conflict with, and have not received any notice of any claim of
conflict with, any such rights of others.
(w) There are no contracts or other documents which are required to be
described in the Prospectus or filed as exhibits to the Registration
Statement by the Act which have not been described in the Prospectus or
filed as exhibits to the Registration Statement or incorporated therein by
reference as permitted by the Act.
(x) No labor disturbance by the employees of the Company or any of its
subsidiaries exists or, to the Issuers' knowledge, is imminent which could
reasonably be expected to have a Material Adverse Effect.
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(y) The Company and its subsidiaries have filed all federal, state and
local income and franchise tax returns required to be filed through the
date hereof and has paid all taxes due thereon, and no tax deficiency has
been determined adversely to the Company or any of its subsidiaries which
has had (nor does any Issuer have any knowledge of any tax deficiency which
would reasonably likely have) a Material Adverse Effect.
(z) Since the date as of which information is given in the Prospectus,
and except as may otherwise be disclosed in the Prospectus, neither the
Company nor any of its subsidiaries has (i) entered into any material
transaction not in the ordinary course of business or (ii) declared or paid
any dividend on its capital stock, and, from the date of the Prospectus,
neither the Company nor any of its subsidiaries has incurred any material
liability other than in the ordinary course of business.
(aa) The Company is in full compliance with Section 13(b)(2) of the
Exchange Act.
(bb) Neither the Company nor any of its subsidiaries (i) is in
violation of its organizational documents, (ii) is in default in any
material respect, and no event has occurred which, with notice or lapse of
time or both, would constitute such a default, in the due performance or
observance of any term, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement or other material agreement or
instrument to which it is a party or by which it is bound or to which any
of its properties or assets is subject as a result of which default there
would be a Material Adverse Effect or (iii) is in violation of any law,
ordinance, governmental rule, regulation or court decree to which it or its
property or assets may be subject or has failed to obtain any license,
permit, certificate, franchise or other governmental authorization or
permit necessary to the ownership of its property or to the conduct of its
business which violation or failure would have a Material Adverse Effect.
(cc) Neither the Company nor any of its subsidiaries is an "investment
company" or an entity "controlled" by an "investment company" within the
meaning of the Investment Company Act of 1940, as amended, and the rules
and regulations of the Commission thereunder.
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7. Indemnification. (a) The Issuers, jointly and severally, agree to
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indemnify and hold harmless the Underwriter and each person, if any, who
controls the Underwriter within the meaning of Section 15 of the Act or Section
20 of the Exchange Act, from and against any and all losses, claims, damages,
liabilities and judgments caused by any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or the
Prospectus (as amended or supplemented if the Company shall have furnished any
amendments or supplements thereto) or any preliminary prospectus, or caused by
any omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, liabilities or judgments are
caused by any such untrue statement or omission or alleged untrue statement or
omission based upon information relating to the Underwriter furnished in writing
to the Issuers by or on behalf of the Underwriter expressly for use therein;
provided, however, that the foregoing indemnity agreement with respect to any
-------- -------
preliminary prospectus shall not inure to the benefit of the Underwriter or any
person controlling such Underwriter asserted by a person with respect to any
such losses, claims, damages and liabilities and judgments, if a copy of the
Prospectus (as then amended or supplemented if the Issuers shall have furnished
such amendment or supplement thereto in the requisite quantity on a timely basis
to permit such sending or giving) was not sent or given by or on behalf of the
Underwriter to such person, if required by law so to have been delivered, at or
prior to the written confirmation of the sale of Notes to such person, and if
the Prospectus (as so amended and supplemented) would have cured the defect
giving rise to such loss, claim, damage, liability or judgment. Notwithstanding
anything to the contrary herein, the Underwriter shall not be obligated to send
or give any Incorporated Document, or any amendment or supplement thereto, to
any person in order to benefit from the indemnity provisions herein or
otherwise. The foregoing indemnity agreement shall be in addition to any
liability that the Issuers may otherwise have.
(b) In case any action shall be brought against the Underwriter or any
person controlling the Underwriter, based upon any preliminary prospectus, the
Registration Statement or the Prospectus or any amendment or supplement thereto
and with respect to which indemnity may be sought against the Issuers, the
Underwriter shall promptly notify the Issuers in writing
-16-
and the Issuers shall assume the defense thereof, including the employment of
counsel reasonably satisfactory to such indemnified party and payment of all
fees and expenses. The Underwriter or any such controlling person shall have the
right to employ separate counsel in any such action and participate in the
defense thereof, but the fees and expenses of such counsel shall be at the
expense of the Underwriter or such controlling person unless (i) the employment
of such counsel shall have been specifically authorized in writing by the
Issuers, (ii) the Issuers shall have failed to assume the defense and employ
counsel or (iii) the named parties to any such action (including any impleaded
parties) include both the Underwriter or such controlling person and the Issuers
and the Underwriter or such controlling person shall have been advised by such
counsel that there may be one or more legal defenses available to it which are
different from or additional to those available to the Issuers (in which case
the Issuers shall not have the right to assume the defense of such action on
behalf of the Underwriter or such controlling person, it being understood,
however, that the Issuers shall not, in connection with any one such action or
separate but substantially similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances, be liable for the
fees and expenses of more than one separate firm of attorneys (in addition to
any local counsel) for the Underwriter and all such controlling persons, which
firm shall be designated in writing by Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
Corporation and that all such fees and expenses shall be reimbursed as they are
incurred). The Issuers shall not be liable for any settlement of any such action
effected without the Company's written consent but if settled with the written
consent of the Company, the Issuers agree to indemnify and hold harmless the
Underwriter and any such controlling person from and against any loss or
liability by reason of such settlement. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of any
pending or threatened proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such proceeding.
(c) The Underwriter agrees to indemnify and hold harmless the Issuers,
their directors, their officers who sign the Registration Statement and any
person controlling the Issuers within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, to the same extent as the foregoing indem-
-17-
nity from the Issuers to the Underwriter but only with reference to information
relating to the Underwriter furnished in writing by or on behalf of the
Underwriter expressly for use in the Registration Statement, the Prospectus or
any preliminary prospectus. In case any action shall be brought against the
Issuers, any of its directors, any such officer or any person controlling the
Issuers based on the Registration Statement, the Prospectus or any preliminary
prospectus and in respect of which indemnity may be sought against the
Underwriter, the Underwriter shall have the rights and duties given to the
Issuers (except that if the Issuers shall have assumed the defense thereof, the
Underwriter shall not be required to do so, but may employ separate counsel
therein and participate in the defense thereof but the fees and expenses of such
counsel shall be at the expense of the Underwriter), and the Issuers, their
directors, any such officers and any person controlling the Issuers shall have
the rights and duties given to the Underwriter, by Section 7(b) hereof.
(d) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party in respect of any losses, claims, damages,
liabilities or judgments referred to therein, then each indemnifying party, in
lieu of indemnifying such indemnified party, shall contribute to the amount paid
or payable by such indemnified party as a result of such losses, claims,
damages, liabilities and judgments (i) in such proportion as is appropriate to
reflect the relative benefits received by the Issuers on the one hand and the
Underwriter on the other hand from the offering of the Securities or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Issuers and
the Underwriter in connection with the statements or omissions which resulted in
such losses, claims, damages, liabilities or judgments, as well as any other
relevant equitable considerations. The relative benefits received by the Issuers
and the Underwriter shall be deemed to be in the same proportion as the total
net proceeds from the offering (before deducting expenses) received by the
Company, and the compensation received by the Underwriter (based on discount to
investors on resale), bear to the sum of such total net proceeds and such
compensation. The relative fault of the Issuers and the Underwriter shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission to state a material fact
relates to information supplied by the Issuers or the Underwriter and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
-18-
The Issuers and the Underwriter agree that it would not be just and
equitable if contribution pursuant to this Section 7(d) were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of
the losses, claims, damages, liabilities or judgments 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 7, the
Underwriter shall not be required to contribute any amount in excess of the
amount by which the total price at which the Notes underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
(e) The Underwriter confirms and the Issuers acknowledge that the
statements with respect to the public offering of the Securities by the
Underwriter set forth in the last two paragraphs of the cover page of the
Prospectus Supplement are correct and constitute the only information concerning
such Underwriter furnished in writing to the Issuers by or on behalf of the
Underwriter specifically for inclusion in the Registration Statement and the
Prospectus.
8. Conditions of Underwriter's Obligation. The obligation of the
--------------------------------------
Underwriter to purchase the Securities under this Agreement is subject to the
satisfaction of each of the following conditions:
(a) All the representations and warranties of the Issuers contained in
this Agreement shall be true and correct on the Closing Date with the same
force and effect as if made on and as of the Closing Date. The Issuers
shall have performed or complied with all of their agreements herein
contained and required to be performed or complied with by them at or prior
to the Closing Date.
-19-
(b) (i) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall
have been commenced or shall be pending before or threatened by the
Commission, (ii) every request for additional information on the part of
the Commission shall have been complied with in all material respects, and
(iii) no stop order suspending the sale of the Securities in any
jurisdiction referred to in Section 6(g) shall have been issued and no
proceeding for that purpose shall have been commenced or shall be pending
or threatened which would, in your reasonable judgment, make it
impracticable or inadvisable to market the Securities or to enforce
contracts for the sale of the Securities.
(c) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date, there shall not have been any downgrading, nor
shall any notice have been given of any intended or potential downgrading
or of any review for a possible change that does not indicate the direction
of the possible change, in the rating accorded any Issuer's debt by any
"nationally recognized statistical rating organization," as such term is
defined for purposes of Rule 436(g)(2) under the Act.
(d) (i) Since the date of the latest balance sheet included in the
Registration Statement and the Prospectus, there shall not have been any
material adverse change, or any development involving a prospective
material adverse change, in the condition, financial or otherwise, or in
the earnings, affairs or business prospects, whether or not arising in the
ordinary course of business, of the Company and its subsidiaries taken as a
whole, (ii) since the date of the latest balance sheet included in the
Registration Statement and the Prospectus there shall not have been any
change, or any development involving a prospective material adverse change,
in the capital stock or in the long-term debt of the Company or any of its
subsidiaries from that set forth in the Registration Statement and
Prospectus and (iii) the Company and its subsidiaries shall have no
liability or obligation, direct or contingent, which is material to the
Company and its subsidiaries, taken as a whole, other than those reflected
in the Registration Statement and the Prospectus.
(e) You shall have received on the Closing Date a certificate dated
the Closing Date, signed by Xxxxxx X. Xxxxxx and Xxxxx X. Xxxxxx, in their
capacities as the
-20-
Chairman of the Board and Chief Financial Officer of the Company,
respectively, confirming the matters set forth in paragraphs (a), (b), (c)
and (d) of this Section 8.
(f) You shall have received on the Closing Date an opinion
(satisfactory to you and counsel for the Under-writer), dated the Closing
Date, of Xxxxxx Xxxx & Xxxxxxxx LLP, special counsel for the Company, to
the effect that:
(i) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of
Delaware, is duly qualified to do business and is in good standing as
a foreign corporation in each jurisdiction 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
have a material adverse effect on the business, operations or
financial condition of the Company and its subsidiaries taken as a
whole, and has all corporate power and authority necessary to own or
hold its properties and conduct its business as described in the
Prospectus.
(ii) To such counsel's knowledge and other than as described in
the Prospectus, there are no legal or governmental proceedings pending
to which the Company or any of its subsidiaries is a party or of which
any property or assets of the Company or any of its subsidiaries is
the subject which is of a character which is required to be disclosed
in the Prospectus; and, to such counsel's knowledge, no such
proceedings are threatened by governmental authorities or by others.
(iii) The Registration Statement was declared effective under the
Act as of the date and time specified in such opinion, the Prospectus
was filed with the Commission pursuant to the subparagraph of Rule
424(b) under the Act on the date specified therein, and, to such
counsel's knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceeding for that
purpose is pending or threatened by the Commission.
(iv) The Registration Statement and the Prospectus and any further
amendments or supplements thereto made by the Company prior to the
Closing Date (other than the financial and pro forma data (and the
re-
-21-
lated notes thereto) and statistical data and the financial
statements and related schedules therein, as to which such counsel
need express no opinion) appear on their face to comply as to form in
all material respects with the requirements of the Act; the documents
incorporated by reference in the Prospectus and any further amendment
or supplement to any such incorporated document made by the Company
prior to the Closing Date (other than the financial and pro forma data
(and the related notes thereto) and statistical data and the financial
statements, and related schedules therein, as to which such counsel
need express no opinion), when they were filed with the Commission
appear on their face to have been appropriately responsive in all
material respects to the requirements of the Act and the Exchange Act.
(v) To such counsel's knowledge, there are no contracts or other
documents of a character which are required to be described in the
Prospectus or filed as exhibits to the Registration Statement by the
Act which have not been described or filed as exhibits to the
Registration Statement or incorporated therein by reference as
permitted by the Act.
(vi) This Agreement has been duly authorized, executed and
delivered by the Company.
(vii) The execution, delivery and performance of this Agreement,
the Indenture and the Securities by the Issuers and the compliance by
the Issuers with all of the provisions of this Agreement and the
consummation by the Issuers of the transactions contemplated hereby
and thereby will not, to such counsel's knowledge, conflict with or
result in a material breach or violation of any of the terms or
provisions of, or constitute a material default under, any indenture,
mortgage, deed of trust, loan agreement or other material agreement or
instrument filed (including by incorporation by reference) by the
Company as an Exhibit to its Annual Report on Form 10-K for the fiscal
year ended September 30, 1996 or to any Quarterly Report on Form 10-Q
or any Current Report on Form 8-K filed since September 30, 1996, nor
will such actions result in any violation of the provisions of the
charter or by-laws of any Issuer or any statute or, to such counsel's
knowledge, any order, rule or regulation known to such counsel of any
-22-
court or governmental agency or body having jurisdiction over any
Issuer or any of their property or assets; and, except for such
consents, approvals, authorizations, registrations or qualifications
as may be required under the Act and applicable state or foreign
securities laws in connection with the purchase and distribution of
the Securities by the Underwriter, no consent, approval, authorization
or order of, or filing or registration with, any such court or
governmental agency or body is required for the execution, delivery
and performance of this Agreement, the Indenture and the Securities by
the Issuers and the valid issuance and sale of the Securities by the
Issuers.
(viii) The Indenture has been duly qualified under the TIA and has
been duly authorized, executed and delivered by the Issuers and is a
valid and binding agreement of the Issuers, enforceable in accordance
with its terms except as (a) the enforceability thereof may be limited
by bankruptcy, insolvency or similar laws affecting creditors' rights
generally and (b) rights of acceleration and the availability of
equitable remedies may be limited by equitable principles of general
applicability.
(ix) The Notes have been duly authorized and executed by the
Company and, when authenticated in accordance with the provisions of
the Indenture and delivered to the Underwriter against payment
therefor as provided by 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 except as
(i) the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally and
(ii) rights of acceleration and the availability of equitable remedies
may be limited by equitable principles of general applicability.
(x) The Guarantees have been duly authorized and endorsed on the
Notes by the Guarantors, and, upon execution and authentication of the
Notes in accordance with the provisions of the Indenture and delivery
thereof to the Underwriter against payment therefor as provided by
this Agreement, will be entitled to the benefits of the Indenture, and
will be valid and binding obligations of the Guarantors, enforce-
-23-
able in accordance with their terms except as (i) the enforceability
thereof may be limited by bankruptcy, insolvency or similar laws
affecting creditors' rights generally and (ii) rights of acceleration
and the availability of equitable remedies may be limited by equitable
principles of general applicability.
(xi) The Securities and the Indenture conform in all material
respects to the descriptions thereof in the Prospectus.
In rendering such opinion, such counsel may state that its opinion is
limited to the Federal laws of the United States of America, the laws of the
States of Texas and New York and the General Corporation Law of the State of
Delaware. Such counsel shall also have furnished to the Underwriter a written
statement, addressed to the Underwriter and dated the Closing Date, in form and
substance satisfactory to the Underwriter and counsel for the Underwriter, to
the effect that (x) such counsel has acted as special counsel to the Company in
connection with the preparation of the Registration Statement and during the
course of the preparation of the Registration Statement and Prospectus, such
counsel participated in conferences with representatives of the Company, the
Company's internal counsel, and its accountants and the representatives of the
Underwriter and at which conferences the contents of the Registration Statement
and the Prospectus and related matters were discussed, and (y) based on the
foregoing, no facts have come to the attention of such counsel which lead it to
believe that (I) the Registration Statement (except as to financial and pro
forma data (and related notes thereto) and statistical data and the financial
statements and related schedules contained or incorporated by reference
therein), as of the date the Registration Statement became effective, contained
any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the statements
therein not misleading, or that the Prospectus (except as to financial and pro
forma data (and related notes thereto) and statistical data and the financial
statements and related schedules contained or incorporated by reference therein)
contains any untrue statement of a material fact or omits to state a material
fact required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading or (II) any Incorporated Document or any amendment or supplement
thereto made by the Company prior to such Closing Date, when they were filed
with the Commission, as the case may be, contained (except as to financial and
pro forma data (and related notes
-24-
thereto) and statistical data and the financial statements and related schedules
contained or incorporated by reference therein) an untrue statement of a
material fact or omitted to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. The foregoing opinion and statement may be qualified by a
statement to the effect that such counsel has not independently verified the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or Prospectus or incorporated by reference therein, and
such counsel is not passing upon and such counsel does not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement or the Prospectus.
(g) You shall have received on the Closing Date, an opinion of Xxxxxxx
X. Xxxxxx, Esq., General Counsel of the Company, dated the Closing Date and
addressed to you, to the effect that:
(i) The issue and sale of the Securities by the Issuers and the
compliance by the Issuers with all of the provisions of this Agreement
and the consummation by the Issuers of the transactions contemplated
hereby will not, to such counsel's knowledge, conflict with or result
in a material breach or violation of any of the terms or provisions
of, or constitute a material default under, any indenture, mortgage,
deed or trust, loan agreement or other material agreement or
instrument known to such counsel to which the Company or any of its
subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, nor will such actions
result in any violation of the provisions of the charter or by-laws of
any Issuer or any order, rule or regulation known to such counsel of
any court or governmental agency or body having jurisdiction over any
Issuer or any of their property or assets.
(ii) Each Guarantor that is a corporation has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of its state of incorporation, is duly qualified to do
business and is in good standing as a foreign corporation in each
jurisdiction in which its ownership or lease of its property or the
conduct of its business re-
-25-
quires such qualification, except where the failure to be so
qualified would not have a material adverse effect on the business,
operations or financial condition of the Company and its subsidiaries
taken as a whole, and has all corporate power and authority necessary
to own or hold its properties and conduct its business as described in
the Prospectus. The outstanding shares of capital stock of each such
Guarantor is duly authorized, validly issued, fully paid and
nonassessable and (except for directors' qualifying shares) are owned
of record, directly or indirectly by the Company. Each Guarantor that
is a limited partnership has been duly formed and is validly existing
as a limited partnership in good standing under the laws of the state
of its organization, is duly qualified to do business and is in good
standing as a foreign limited partnership in each jurisdiction in
which its ownership or lease of its property or the conduct of its
business requires such qualification, except where the failure to be
so qualified would not have a material adverse effect on the business,
operation or financial condition of the Company and its subsidiaries
taken as a whole, and has all partnership power and authority
necessary to own or hold its properties and conduct its business as
described in the Prospectus.
(h) You shall have received on the Closing Date an opinion, dated the
Closing Date, of Xxxxxx Xxxxxx and Xxxxxxx, counsel for the Underwriter, in
form and substance satisfactory to the Underwriter.
(i) You shall have received a letter on and as of the Closing Date, in
form and substance satisfactory to you, from Ernst & Young, LLP,
independent public accountants, with respect to the financial statements
and certain financial information contained in the Registration Statement
and the Prospectus and substantially in the form and substance of the
letter delivered to you by Ernst & Young, LLP, on the date of this
Agreement.
(j) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements in the
Prospectus any loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from any
labor dispute or court or governmental action, order or decree, otherwise
than as set forth or contem-
-26-
plated in the Prospectus or (ii) since such date there shall not have been
any change in the capital stock, net revenues, per share or total amounts
of income before extraordinary income or of net income or long-term debt of
the Company or any of its subsidiaries or any change, or any development
involving a prospective change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, otherwise than as set forth
or contemplated in the Prospectus, the effect of which, in any such case
described in clause (i) or (ii), is, in the judgment of the Underwriter, so
material and adverse as to make it impracticable or inadvisable to proceed
with the public offering or the delivery of the Securities being delivered
on the Closing Date on the terms and in the manner contemplated in the
Prospectus.
(k) The Issuers shall have furnished to you such other documents and
certificates as to the accuracy and completeness of any statement in the
Registration Statement or the Prospectus as you reasonably may request.
(l) You shall have been furnished with such additional documents and
certificates as you or counsel for the Underwriter may reasonably request.
All such opinions, certificates, letters and other documents will be
in compliance with the provisions hereof only if they are reasonably
satisfactory in form and substance to you and your counsel.
Any certificate or document signed by any officer of the Issuers and
delivered to you or to your counsel shall be deemed a representation and
warranty by the Issuers to each Underwriter as to the statements made therein.
9. Termination.
-----------
This Agreement may be terminated at any time prior to the Closing Date
by you by written notice to the Issuers if any of the following has occurred:
(i) since the respective dates as of which information is given in the
Registration Statement and the Prospectus, any material adverse change or
development involving a prospective material adverse change in the condition,
financial or otherwise, of the Issuers and its subsidiaries or the earnings,
affairs, or business prospects of the Issuers or any of its subsidiaries taken
as a whole, whether or not arising in the ordinary course of business, which
would, in
-27-
your judgment, make it impracticable to market the Securities on the
terms and in the manner contemplated in the Prospectus, (ii) any outbreak or
escalation of hostilities or other national or international calamity or crisis
or change in economic conditions or in the financial markets of the United
States or elsewhere that, in your judgment, is material and adverse and would,
in your judgment, make it impracticable to market the Shares on the terms and in
the manner contemplated in the Prospectus, (iii) the suspension or material
limitation of trading in securities on the New York Stock Exchange, the American
Stock Exchange or the Nasdaq National Market or limitation on prices for
securities on any such exchange or National Market System, (iv) the enactment,
publication, decree or other promulgation of any federal or state statute,
regulation, rule or order of any court or other governmental authority which in
your opinion materially and adversely affects, or will materially and adversely
affect, the business or operations of the Company and its subsidiaries taken as
a whole, (v) the declaration of a banking moratorium by either federal or New
York State authorities or (vi) the taking of any action by any federal, state or
local government or agency in respect of its monetary or fiscal affairs which in
your opinion has a material adverse effect on the financial markets in the
United States.
10. Miscellaneous. Notices given pursuant to any provision of this
-------------
Agreement shall be addressed as follows: (a) if to the Issuers, to X.X. Xxxxxx,
0000 Xxxxxxxxx Xxxx., Xxxxx 000 Xxxxxxxxx, Xxxxx 00000, and (b) if to the
Underwriter, to Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation, 000 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Syndicate Department, or 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, its officers and directors (in
their capacities as such) and of the Underwriter 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 Notes, regardless of (i) any
investigation, or statement as to the results thereof, made by or on behalf of
the Underwriter or by or on behalf of the Company, the officers or directors of
the Company or any controlling person of the Company (in their capacities as
such), (ii) acceptance of the Notes and payment for them hereunder and (iii)
termination of this Agreement.
-28-
If this Agreement shall be terminated by the Underwriter because of
any failure or refusal on the part of any Issuer to perform any of its
agreements in this Agreement or to fulfill any of the conditions of Section 8 of
this Agreement, the Issuers, jointly and severally, agree to reimburse the
Underwriter for all out-of-pocket expenses (including the fees and disbursements
of counsel) reasonably incurred by it.
Except as otherwise provided, this Agreement has been and is made
solely for the benefit of and shall be binding upon the Issuers, the
Underwriter, any controlling persons referred to herein and their respective
successors and assigns, all as and to the extent provided in this Agreement, and
no other person shall acquire or have any right under or by virtue of this
Agreement. The term "successors and assigns" shall not include a purchaser of
any of the Notes from the Underwriter 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.
-29-
Please confirm that the foregoing correctly sets forth the agreement
between the Issuers and the Underwriter.
Very truly yours,
X.X. XXXXXX, INC.
By: /s/Xxxxx X. Xxxxxx
------------------
Name: Xxxxx X. Xxxxxx
Title: Treasurer
GUARANTORS:
DRHI, Inc.
DRH Construction, Inc.
DRH New Mexico Construction, Inc.,
X.X. Xxxxxx Denver Management Company, Inc.
X.X. Xxxxxx Denver Xx. 00, Xxx.
X.X. Xxxxxx Xxxxxx Xx. 00, Inc.
X.X. Xxxxxx Denver Xx. 00, Xxx.
X.X. Xxxxxx Xxxxxx Xx. 00, Inc.
X.X. Xxxxxx Denver Xx. 00, Xxx.
X.X. Xxxxxx Xxxxxx Xx. 00, Inc.
X.X. Xxxxxx Denver Xx. 00, Xxx.
X.X. Xxxxxx Xxxxxx Xx. 00, Inc.
X.X. Xxxxxx Denver No. 18, Inc.
X.X. Xxxxxx, Inc.-Albuquerque
X.X. Xxxxxx, Inc.- Denver
X.X. Xxxxxx, Inc.-Minnesota
X.X. Xxxxxx, Inc.-New Jersey
Xxxxxxx I, Ltd.
Xxxxxxx II, Ltd.
Xxxxxxx III, Ltd.
Xxxxxxx IX, Inc.
Xxxxxxx X, Inc.
X.X. Xxxxxx Los Angeles Holding Company,
Inc.
X.X. Xxxxxx Los Angeles Management
Company, Inc.
X.X. Xxxxxx Los Angeles No. 9, Inc.
X.X. Xxxxxx Los Angeles No. 10, Inc.
X.X. Xxxxxx Los Angeles No. 11, Inc.
X.X. Xxxxxx Los Angeles No. 12, Inc.
X.X. Xxxxxx Los Angeles No. 13, Inc.
X.X. Xxxxxx Los Angeles No. 14, Inc.
-00-
X.X. Xxxxxx Xxx Xxxxxxx No. 16, Inc.
X.X. Xxxxxx Los Angeles No. 17, Inc.
X.X. Xxxxxx, Inc. - Birmingham
X.X. Xxxxxx, Inc. - Greensboro
X.X. Xxxxxx San Diego Holding Company, Inc.
X.X. Xxxxxx San Diego Management Company,
Inc.
X.X. Xxxxxx San Diego No. 9, Inc.
X.X. Xxxxxx San Diego Xx. 00, Xxx.
X.X. Xxxxxx Xxx Xxxxx Xx. 00, Inc.
X.X. Xxxxxx San Diego Xx. 00, Xxx.
X.X. Xxxxxx Xxx Xxxxx Xx. 00, Inc.
X.X. Xxxxxx San Diego Xx. 00, Xxx.
X.X. Xxxxxx Xxx Xxxxx Xx. 00, Inc.
X.X. Xxxxxx San Diego Xx. 00, Xxx.
X.X. Xxxxxx Xxx Xxxxx Xx. 00, Inc.
X.X. Xxxxxx San Diego No. 18, Inc.
X.X. Xxxxxx San Diego Xx. 00, Xxx.
X.X. Xxxxxx Xxx Xxxxx Xx. 00, Inc.
X.X. Xxxxxx San Diego No. 21, Inc.
X.X. Xxxxxx, Inc. - Torrey
X. X. Xxxxxx Atlanta, Ltd.
By: /s/Xxxxx X. Xxxxxx
------------------
Name: Xxxxx X. Xxxxxx
Title: Treasurer
-31-
SGS COMMUNITIES AT GRANDE QUAY, LLC
By Xxxxxxx IX, Inc., a member
By: /s/Xxxxx X. Xxxxxx
------------------
Name: Xxxxx X. Xxxxxx
Title: Treasurer
and
By Xxxxxxx X, Inc., a member
By: /s/Xxxxx X. Xxxxxx
------------------
Name: Xxxxx X. Xxxxxx
Title: Treasurer
X.X. XXXXXX MANAGEMENT COMPANY, LTD.
By Xxxxxxx I, Ltd., its general partner
By: /s/Xxxxx X. Xxxxxx
------------------
Name: Xxxxx X. Xxxxxx
Title: Treasurer
-32-
X.X. XXXXXX - TEXAS, LTD.
By Xxxxxxx I, Ltd., its general partner
By: /s/Xxxxx X. Xxxxxx
------------------
Name: Xxxxx X. Xxxxxx
Title: Treasurer
X.X. XXXXXX - ROYALTY, LTD.
By Xxxxxxx I, Ltd., its general partner
By: /s/Xxxxx X. Xxxxxx
------------------
Name: Xxxxx X. Xxxxxx
Title: Treasurer
-33-
Agreed and accepted as of the
date first written above:
XXXXXXXXX, LUFKIN & XXXXXXXX
SECURITIES CORPORATION
By: /s/Xxxx Xxxxxxxx
-------------------
Name: Xxxx Xxxxxxxx
Title: Managing Director
