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EXHIBIT 10.15
RALPHS GROCERY COMPANY
$155,000,000 11% Senior Subordinated Notes due 2005
PURCHASE AGREEMENT
March 21, 1997
BT Securities Corporation
Bankers Trust International plc
Xxx Xxxxxxx Xxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
CIBC Wood Gundy Securities Corp.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Credit Suisse First Boston
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Ralphs Grocery Company, a Delaware corporation (the "Company"),
together with each of Alpha Beta Company, Bay Area Warehouse Stores, Inc., Xxxx
Markets, Inc., Cala Co., Cala Foods, Inc., Xxxxxx'x, Inc., Food 4 Less of
California, Inc., Food 4 Less Merchandising, Inc., Food 4 Less of Southern
California, Inc., Food 4 Less GM, Inc., and Xxxxxxxx Stores, Inc. as guarantors
(collectively, the "Subsidiary Guarantors", and together with the Company, the
"Issuers"), hereby confirm that their agreement with you (the "Initial
Purchasers"), as set forth below:
1. The Securities. Subject to the terms and conditions herein
contained, the Company proposes to issue and sell to the Initial Purchasers
$155,000,000 aggregate principal amount of its Senior Subordinated Notes, the
terms of which will be substantially identical to the Company's 11% Senior
Subordinated Notes due 2005, which were issued in a registered offering on June
14, 1995 (the "Notes"). The Notes will be unconditionally guaranteed (the
"Guarantees") on a joint and sev-
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eral basis, by the Subsidiary Guarantors. The Notes and the Guarantees are
hereinafter referred to collectively as the "Securities". The Notes are to be
issued under an indenture (the "Indenture") to be dated March 26, 1997, by and
among the Company, the Subsidiary Guarantors and United States Trust Company of
New York, as trustee (the "Trustee").
The Notes will be offered and sold to the Initial Purchasers
without such offers and sales being registered under the Securities Act of 1933,
as amended (the "Act"), in reliance on exemptions therefrom.
In connection with the sale of the Notes, the Company has
prepared a preliminary offering memorandum dated March 1997 and distributed on
March 19, 1997 (the "Preliminary Memorandum"), and a final offering memorandum
dated March 21, 1997 (the "Final Memorandum"; the Preliminary Memorandum and the
Final Memorandum each herein being referred to as a "Memorandum") setting forth
or including a description of the terms of the Notes, the terms of the offering
of the Notes, a description of the Company and its subsidiaries and any material
developments relating to the Company and its subsidiaries occurring after the
date of the most recent historical financial statements included therein.
The Company and the Subsidiary Guarantors understand that the
Initial Purchasers propose to make an offering of the Notes only on the terms
and in the manner set forth in the Memorandum and Section 8 hereof as soon as
the Initial Purchasers deem advisable after this Agreement has been executed and
delivered, to persons in the United States whom the Initial Purchasers
reasonably believe to be qualified institutional buyers ("QIBs") as defined in
Rule 144A under the Act, as such rule may be amended from time to time ("Rule
144A"), in transactions under Rule 144A and outside the United States to certain
persons in reliance on Regulation S under the Act.
The Initial Purchasers and their direct and indirect transferees
of the Notes will be entitled to the benefits of the Registration Rights
Agreement, substantially in the form attached hereto as Exhibit A (the
"Registration Rights Agreement"), pursuant to which the Issuers have agreed,
among other things, to file (i) a registration statement (the "Registration
Statement") with the Securities and Exchange Commission (the "Commission")
registering the Securities or the Exchange Notes (as defined in the Registration
Rights Agreement) under the Act or (ii) a shelf registration statement pursuant
to Rule 415 under the Act relating to the resale of the Securities, by hold-
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ers thereof or, if applicable, relating to the resale of Private Exchange Notes
(as defined in the Registration Rights Agreement) by the Initial Purchasers
pursuant to an exchange of the Securities for Private Exchange Notes.
2. Representations and Warranties. Each Issuer jointly and
severally represents and warrants to and agrees with the Initial Purchasers
that:
(i) Neither the Preliminary Memorandum as of the date
thereof nor the Final Memorandum nor any amendment or supplement thereto
as of the date thereof and at all times subsequent thereto up to the
Closing Date (as defined in Section 3 below) contained or contains any
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, except
that the representations and warranties set forth in this Section 2 do
not apply to statements or omissions made in reliance upon and in
conformity with information relating to the Initial Purchasers furnished
to the Company in writing by the Initial Purchasers expressly for use in
the Preliminary Memorandum, the Final Memorandum or any amendment or
supplement thereto.
(ii) Each of the Issuers has all the necessary corporate
power and authority to execute and deliver this Agreement, to perform
its obligations hereunder and to consummate the transactions
contemplated hereby and by the Final Memorandum (or, if the Final
Memorandum is not in existence, the most recent Preliminary Memorandum).
Each of the Issuers has taken all necessary corporate action to
authorize the issuance of the Securities.
(iii) Each of the Issuers is duly incorporated and validly
existing in good standing as a corporation under the laws of its
jurisdiction of incorporation, with all requisite corporate power and
authority to own or lease its properties and conduct its businesses as
now conducted as described in the Final Memorandum (or, if the Final
Memorandum is not in existence, the most recent Preliminary Memorandum),
and each of the Issuers is duly qualified to do business as a foreign
corporation in good standing in all other jurisdictions where the
ownership
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or leasing of its properties or the conduct of its businesses requires
such qualification, except where the failure to be so qualified would
not have (x) a material adverse effect on the business, condition
(financial or other) or results of operations of the Issuers taken as a
whole; or (y) an adverse effect on the ability of any Issuer to perform
any of its material obligations under this Agreement, the Indenture or
the Securities (a "Material Adverse Effect"); the Company has, in all
material respects, the authorized, issued and outstanding capitalization
set forth in the Final Memorandum (or, if the Final Memorandum is not in
existence, the most recent Preliminary Memorandum); other than
Xxxxx/Vermont Renaissance Plaza, Ltd., a California limited partnership,
the only direct or indirect subsidiaries of the Company are the
Subsidiary Guarantors; except as aforesaid, none of the Issuers owns,
directly or indirectly, any of the capital stock or other equity
securities of any other person, except that Alpha Beta Company has an
investment in Certified Grocers of California, Inc. ("Certified"), one
of the Company's suppliers, and in Xxxxx/Vermont and Food 4 Less GM has
an interest in a joint venture with Certified; the outstanding shares of
capital stock of each of the Issuers have been duly authorized and
validly issued, are fully paid and nonassessable and were not issued in
violation of any preemptive or similar rights granted by such person;
and except as described in the Final Memorandum (or, if the Final
Memorandum is not in existence the most recent Preliminary Memorandum),
all of the outstanding shares of capital stock of each of the Subsidiary
Guarantors are owned beneficially by the Company free and clear of all
liens, encumbrances, security interests, mortgages, pledges, charges or
claims. No holders of securities or any of the Issuers are entitled to
have such securities registered under the Registration Statement.
(iv) The Securities, the Exchange Securities and the Private
Exchange Securities have been duly and validly authorized by the Issuers
for issuance and conform in all material respects to the description
thereof in the Final Memorandum (or, if the Final Memorandum is not in
existence, the most recent Preliminary Memorandum). The Securities, the
Ex-
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change Securities and the Private Exchange Securities when executed by
the Issuers and authenticated by the Trustee in accordance with the
provisions of the Indenture, and, in the case of the Securities,
delivered to and paid for by the Initial Purchasers in accordance with
the terms hereof, will have been duly executed, issued and delivered and
will constitute valid and legally binding obligations of the Issuers
entitled to the benefits of the Indenture and enforceable against the
Issuers in accordance with their terms, except that the enforcement
thereof may be subject to (i) bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, (ii) general principles of equity and the
discretion of the court before which any proceeding therefor may be
brought (regardless of whether such enforcement is considered in a
proceeding in equity or at law), (iii) the unenforceability, under
certain circumstances, of provisions imposing penalties, forfeitures,
late payment charges or an increase in interest rate upon delinquency in
payment or the occurrence of a default, and (iv) the unenforceability of
any provision requiring the payment of attorneys' fees, except to the
extent that a court determines such fees to be reasonable. The Issuers
have all requisite corporate power and authority to execute, deliver and
perform their respective obligations under the Indentures and the
Guarantees to issue and deliver the Securities to the Initial Purchasers
as provided herein and to issue the Exchange Securities and the Private
Exchange Securities as provided in the Registration Rights Agreement.
The Indenture has been duly authorized and, when executed and delivered
by the Issuers (assuming the due authorization, execution and delivery
thereof by the Trustee), will constitute a valid and legally binding
agreement of each of the Issuers enforceable against each of them in
accordance with its terms, except that the enforcement thereof may be
subject to (v) bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance or other laws now or hereafter in effect relating
to creditors' rights generally, including, without limitation, the
effect on the Guarantees of Section 548 of the Bankruptcy Code and
comparable provisions of state law, (w) general principles of equity and
the discretion of the court before which
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any proceeding therefor may be brought (regardless of whether such
enforcement is considered in a proceeding in equity or at law), (x) the
unenforceability, under certain circumstances, of provisions imposing
penalties, forfeitures, late payment charges or an increase in interest
rate upon delinquency in payment or the occurrence of a default, (y) the
unenforceability of any provision requiring the payment of attorneys'
fees, except to the extent that a court determines such fees to be
reasonable and (z) the unenforceability of the provisions contained in
the Indenture relating to the waiver of (A) stay, extension or usury
laws and (B) subrogation rights or other rights and defences of the
Subsidiary Guarantors. The Indenture meets the requirement for
qualification under the Trust Indenture Act of 1939, as amended (the
"TIA").
(v) The Guarantees endorsed on the Notes have been, and the
guarantees endorsed on the Exchange Notes and the Private Exchange Notes
will be, duly authorized and, when executed and delivered, will, upon
the execution, authentication and delivery of the Notes, Exchange Notes
and the Private Exchange Notes and, in the case of the Notes, payment
therefor, be valid and binding obligations of each Subsidiary Guarantor
enforceable against such Subsidiary Guarantor in accordance with their
respective terms, except that the enforcement thereof may be subject to
(v) bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance or other similar laws now or hereafter in effect relating to
creditors' rights generally, including, without limitation, the effect
on such guarantees of Section 548 of the Bankruptcy Code and comparable
provisions of state law, (w) general principles of equity and the
discretion of the court before which any proceeding therefor may be
brought (regardless of whether such enforcement is considered in a
proceeding in equity or at law), (x) the unenforceability, under certain
circumstances, of provisions imposing penalties, forfeitures, late
payment charges or an increase in interest rate upon delinquency in
payment or the occurrence of a default, (y) the unenforceability of any
provision requiring the payment of attorneys' fees, except to the extent
that a court determines such fees to be reasonable and (z) the
unenforceability of the provisions contained in
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the Indenture relating to the waiver of (A) stay, extension or usury
laws and (B) subrogation rights or other rights and defences of the
Subsidiary Guarantors.
(vi) This Agreement has been duly authorized, executed and
delivered by each of the Issuers and, assuming the due authorization,
execution and delivery hereof by the Initial Purchasers, constitutes the
valid and legally binding obligation of the Issuers enforceable against
the Issuers in accordance with its terms, except that the enforcement
hereof may be subject to (v) bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, (w) general principles of equity and the
discretion of the court before which any proceeding therefor may be
brought (regardless of whether such enforcement is considered in a
proceeding in equity or at law), (x) the unenforceability, under certain
circumstances, of provisions imposing penalties, forfeitures, late
payment charges or an increase in interest rate upon delinquency in
payment or the occurrence of a default, (y) the unenforceability of any
provision requiring the payment of attorneys' fees, except to the extent
that a court determines such fees to be reasonable and (z) the
unenforceability under certain circumstances under law or court
decisions of provisions for the indemnification of or contribution to a
party with respect to a liability where such indemnification or
contribution is contrary to public policy (clauses (v) through (z) above
are referred to collectively herein as the "Enforceability
Limitations"). Except as described in the Final Memorandum (or, if the
Final Memorandum is not in existence, the most recent Preliminary
Memorandum), no consent, approval, authorization or order of any court
or governmental agency or body is required for the performance of this
Agreement, the Securities, the Guarantees, the Exchange Securities, the
Private Exchange Securities or the Indenture by any of the Issuers (to
the extent each such person is a party thereto) or the consummation by
any Issuer of any of the transactions contemplated hereby or thereby or
by the Final Memorandum (or, if the Final Memorandum is not in
existence, the most recent Preliminary Memorandum), except such as have
been obtained and such as may be required under the
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Act, the TIA or state securities or "Blue Sky" laws or where the failure
to obtain such consent, approval, authorization or order would not have
a Material Adverse Effect. None of the Issuers is (i) in violation of
its certificate of incorporation or bylaws, (ii) in violation of any
statute, judgment, decree, order, rule or regulation applicable to any
of the Issuers which violation would have a Material Adverse Effect, or
(iii) in default in the performance or observance of any obligation,
agreement, covenant or condition contained in any contract, indenture,
mortgage, deed of trust, loan agreement, note, lease, license, franchise
agreement, permit, certificate or other agreement or instrument to which
any of the Issuers is subject, which default would have a Material
Adverse Effect.
The execution, delivery and performance by the Issuers of this
Agreement, the Securities, the Guarantees, the Exchange Securities, the
Private Exchange Securities or the Indenture (to the extent each such
person is a party thereto), and the consummation by each of the Issuers
of the transactions contemplated hereby, thereby and by the Final
Memorandum (or, if the Final Memorandum is not in existence, the most
recent Preliminary Memorandum) will not conflict with or constitute or
result in a breach or violation by any of the Issuers of any of (x) the
terms or provisions of, or constitute a default by any of the Issuers
under, any indenture, mortgage, deed of trust, loan agreement, note,
lease, license, franchise agreement, or other agreement or instrument to
which any such person is a party or to which any of them or their
respective properties is subject, which conflict, breach, violation or
default would have a Material Adverse Effect, (y) the certificate of
incorporation or bylaws of any such person, or (z) any statute,
judgment, decree, order, rule or regulation (excluding state securities
and "Blue Sky" laws) of any court or governmental agency or other body
applicable to any such person, or any of their respective properties,
which conflict, breach, violation or default would have a Material
Adverse Effect.
(vii) (x) Immediately after the consummation of the issuance
of the Securities and the consummation of the other transactions
contemplated by the Final Memorandum (or, if the Final Memorandum is not
in existence, the most recent Preliminary Memorandum), the fair value
and present fair saleable value
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of the assets of each Issuer will exceed the sum of its stated
liabilities and identified contingent liabilities; and (y) after giving
effect to the issuance of the Securities and the consummation of the
other transactions contemplated by the Final Memorandum (or, if the
Final Memorandum is not in existence, the most recent Preliminary
Memorandum), none of the Issuers is (a) left with unreasonably small
capital with which to carry on its business as it is proposed to be
conducted, (b) unable to pay its debts (contingent or otherwise) as they
mature or (c) insolvent.
(viii) Each of the Issuers has all requisite corporate power
and authority to execute, deliver and perform its obligations under the
Registration Rights Agreement. The Registration Rights Agreement has
been duly and validly authorized and, when executed and delivered by the
Issuers, will constitute a valid and legally binding agreement of each
of the Issuers enforceable against each of the Issuers in accordance
with its terms, except that the enforcement thereof may be subject to
the Enforceability Limitations.
(ix) Except as disclosed in the Final Memorandum (or, if the
Final Memorandum is not in existence, the most recent Preliminary
Memorandum), and except as would not individually or in the aggregate
have a Material Adverse Effect (w) each of the Issuers is in compliance
with all applicable Environmental Laws (as defined below), (x) each of
the Issuers has all permits, authorizations and approvals required under
any applicable Environmental Laws and is in compliance with their
requirements, (y) there are no pending, or, to the best knowledge of any
of the Issuers threatened, Environmental Claims (as defined below)
against any of the Issuers and (z) each of the Issuers does not have
knowledge of any circumstances with respect to any of their respective
properties or operations that could reasonably be anticipated to form
the basis of an Environmental Claim against any of the Issuers or any of
their respective properties or operations and the business operations
relating thereto that could reasonably be expected to have a Material
Adverse Effect. For purposes of this Agreement, the following terms
shall have the following meanings: "Environmental
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Law" means, with respect any person, any federal, state, local or
municipal statute, law, rule, regulation, ordinance, code and any
published judicial or administrative interpretation thereof including
any judicial or administrative order, consent decree or judgment binding
on such person or any of its subsidiaries, relating to the environment,
health, safety or any chemical material or substance, exposure to which
is prohibited, limited or regulated by any such governmental authority.
"Environmental Claims" means any and all administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens, notices
of noncompliance or violation, investigations or proceedings relating in
any way to any Environmental Law.
(x) The audited consolidated financial statements of the
Company included in the Final Memorandum (or, if the Final Memorandum is
not in existence, the most recent Preliminary Memorandum) present fairly
the consolidated financial position, results of operations and cash
flows of the Company at the dates and for the periods to which they
relate, and have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis, except as otherwise
stated therein, and the unaudited consolidated financial statements of
the Company and the related notes included in the Final Memorandum (or,
if the Final Memorandum is not in existence, the most recent Preliminary
Memorandum) present fairly the consolidated financial position, results
of operations and cash flows of the Company at the dates and for the
periods to which they relate, subject to year-end audit adjustments, and
have been prepared in accordance with generally accepted accounting
principles applied on a consistent basis, except as otherwise stated
therein.
Each of Xxxxxx Xxxxxxxx LLP and KPMG Peat Marwick, which has
audited certain of such financial statements as set forth in their
reports included in the Final Memorandum (or, if the Final Memorandum is
not in existence, the most recent Preliminary Memorandum) is an
independent public accounting firm as within the meaning of the Act. The
statistical and market-related data (including, without limitation, the
estimated cost savings information) included in the Final Memorandum
(or, if the Final Memorandum is not in existence, the most recent
Preliminary Memo-
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randum) are based on or derived from sources which the Issuers believe
to be reliable and accurate.
(xi) Except as described in the Final Memorandum (or, if the
Final Memorandum is not in existence, the most recent Preliminary
Memorandum) there is not pending or, to the knowledge of any of the
Issuers, threatened, any action, suit, proceeding, inquiry or
investigation to which any Issuer, or to which the property of any
Issuer, is subject, before or brought by any court or governmental
agency or body, which is reasonably likely to have a Material Adverse
Effect.
(xii) Each of the Issuers has (a) good and marketable title to
all the real properties and other material assets (personal, tangible,
intangible or mixed) owned by it, or purported to be owned by it, and,
as of the Closing Date, such title will be free and clear of all liens,
except for liens which would be permitted under the Indenture and (b)
peaceful and undisturbed possession under all leases to which it is a
party as lessee or sublessee, except for such defects in title or lack
of possession that, in the aggregate, could not reasonably be expected
to have a Material Adverse Effect. Each of the Issuers operates all
material real and personal property leased by it under valid and
enforceable leases and has performed in all material respects the
obligations required to be performed by it with respect to each such
lease, except for such leases and obligations which, in the aggregate,
could not reasonably be expected to have a Material Adverse Effect. As
to leases with respect to which any Issuer is the lessor, the lessees
and other parties under such leases are in compliance with all terms and
conditions thereunder and such leases are in full force and effect
except for any failures to comply or remain in full force and effect
which could not reasonably be expected to have a Material Adverse
Effect. All tangible assets and properties of each Issuer are in good
working order (subject to ordinary wear and tear) and are adequate for
the uses to which they are being put or would be put in the ordinary
course of business except for such assets and properties as are not
material in the aggregate to the business, condition (financial
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or otherwise) or results of operations of the Issuers taken as a whole.
(xiii) The Issuers own, or are licensed under, and have the
rights to use, all trademarks and trade names (collectively,
"Intellectual Property") used in, or necessary for the conduct of, their
businesses as currently conducted, and the consummation of the
transactions contemplated hereby and by the Final Memorandum (or, if the
Final Memorandum is not in existence, the most recent Preliminary
Memorandum) will not alter or impair any such rights, except for such
alterations or impairments as could not reasonably be expected to have a
Material Adverse Effect. To the best knowledge of the Issuers no claims
have been asserted by any person to the use of any such Intellectual
Property or challenging or questioning the validity or effectiveness of
any license or agreement related thereto, except for such claims as
could not reasonably be expected to have a Material Adverse Effect. To
the best knowledge of the Issuers, there is no valid basis for any such
claim and the use of such Intellectual Property by the Issuers does not
infringe on the rights of any person. Each of the Issuers has obtained
all licenses, permits, franchises and other governmental authorizations,
the lack of which would have a Material Adverse Effect.
(xiv) Subsequent to the respective dates as of which
information is given in the Final Memorandum (or, if the Final
Memorandum is not in existence, the most recent Preliminary Memorandum)
and except as described therein or contemplated thereby, (x) none of the
Issuers has incurred any material liabilities or obligations, direct or
contingent, or entered into any material transactions, not in the
ordinary course of business and (y) none of the Issuers has purchased
any of its respective outstanding capital stock, nor declared, paid or
otherwise made any dividend or distribution of any kind on their
respective capital stock or otherwise.
(xv) All taxes, assessments, fees and other charges
(including, without limitation, withholding taxes, penalties, and
interest) due or claimed to be due from any of the Issuers that are due
and payable have been paid, other than those being contested in
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good faith or those currently payable without penalty or interest and
for which an adequate reserve or accrual has been established in
accordance with generally accepted accounting principles, and except
where the failure so to pay is not reasonably likely to have, singly or
in the aggregate, a Material Adverse Effect. The Issuers know of no
actual or proposed additional tax assessments for any fiscal period
against the Issuers that, singly or in the aggregate, is reasonably
likely to have a Material Adverse Effect.
(xvi) None of the Issuers, or any agent acting on behalf of
any of them has taken or will take any action that might cause this
Agreement, the issuance or sale of the Securities or the issuance of the
Guarantees to violate Regulation G, T, U or X of the Board of Governors
of the Federal Reserve System as in effect on the Closing Date.
(xvii) None of the Issuers is now, nor after giving effect to
the issuance of the Securities or the consummation of the other
transactions contemplated by the Final Memorandum (or, if the Final
Memorandum is not in existence, the most recent Preliminary Memorandum)
will any Issuer be, an "investment company" or a company "controlled by"
an "investment company" within the meaning of the Investment Company Act
of 1940, as amended.
(xviii) Except as stated in the Final Memorandum (or, if the
Final Memorandum is not in existence, the most recent Preliminary
Memorandum) none of the Issuers knows of any outstanding claims for
services, either in the nature of a finder's fee, financial advisory
fee, origination fee or similar fee, with respect to the transactions
contemplated hereby.
(xix) Except as stated in the Final Memorandum (or, if the
Final Memorandum is not in existence, the most recent Preliminary
Memorandum) none of the Issuers nor, to the best of the Issuers'
knowledge, any of the Issuers' respective directors, officers or
controlling persons has taken, directly or indirectly, any action
designed, or which might reasonably be expected, to cause or result,
under the Act or otherwise, in, or which has constituted, stabili-
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zation or manipulation of the price of any security of the Issuers to
facilitate the issuance of the Securities.
(xx) None of the Company, the Subsidiary Guarantors or any of
their respective Affiliates (as defined in Rule 501(b) of Regulation D
under the Act) directly, or through any agent, (i) sold, offered for
sale, solicited offers to buy or otherwise negotiated in respect of, any
"security" (as defined in the Act) which is or could be integrated with
the sale of the Securities in a manner that would require the
registration under the Act of the Securities or (ii) assuming the
accuracy of the representations and warranties of the Initial Purchasers
in Section 8 hereof, engaged in any form of general solicitation or
general advertising (as those terms are used in Regulation D under the
Act) in connection with the offering of the Securities or in any manner
involving a public offering within the meaning of Section 4(2) of the
Act. Assuming (i) the accuracy of the representations and warranties of
the Initial Purchasers in Section 8 hereof, (ii) the due performance by
the Initial Purchasers of the covenants and agreements set forth in
Section 8 hereof, and (iii) compliance by the Initial Purchasers with
the transfer restrictions described under the caption "Transfer
Restrictions" in the Memorandum, it is not necessary in connection with
the offer, sale and delivery of the Securities to the Initial Purchasers
in the manner contemplated by this Agreement to register any of the
Securities under the Act or to qualify the Indenture under the TIA.
(xxi) No securities of any Issuer are of the same class
(within the meaning of Rule 144A under the Act) as the Securities and
listed on a national securities exchange registered under Section 6 of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or
quoted in a U.S. automated inter-dealer quotation system.
(xxii) The Issuers have not (a) "incurred," as such term is
defined in the Existing Indentures (as defined below), any
"Indebtedness" pursuant to, or in reliance on, clause (m) of the
definition of "Permitted Indebtedness," (b) "made," as such term is used
in the Existing Indentures, any
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"Investments" pursuant to, or in reliance on, the last clause of the
definition of "Permitted Investments," (c) made any Restricted Payments
pursuant to clause (iv) of the first paragraph of Section 5.03 of the
Indentures governing Existing Indebtedness or (d) "created, incurred,
assumed or suffered to exist," as such terms are used in the Existing
Indentures, any "Liens" pursuant to, or in reliance on, clause (xvii) of
the definition of "Permitted Liens". The Securities constitute
"Refinancing Indebtedness" as such term is defined in the Existing
Indentures. For purposes of the preceding sentence, Existing Indentures
shall mean, collectively, (i) the 13.75% Senior Subordinated Notes
Indenture and the 11% Senior Subordinated Notes Indenture, each dated as
of June 1, 1995 by and between the Issuers and United States Trust
Company of New York, as trustee, (ii) the 10.45% Senior Notes Indenture
dated as of June 1, 1995 by and between the Issuers and Norwest Bank
Minnesota, National Association, as trustee and (iii) the 10.45% Senior
Notes Indenture dated as of June 6, 1996 by and between the Issuers and
Norwest Bank Minnesota, National Association, as trustee. The Issuers
have "incurred" no more than $100 million and $10 million and $15
million of "Indebtedness" pursuant to clauses (c), (f) and (m) of the
definition of Permitted Indebtedness, respectively. Capitalized terms in
quotes used in this clause (xxii) shall have the meaning ascribed to
such terms in the applicable Existing Indenture.
Any certificate signed by any officer of any Issuer and delivered
pursuant to this Agreement or in connection with the payment of the purchase
price and delivery of the Securities shall be deemed a representation and
warranty by the Issuers to the Initial Purchasers as to the matters covered
thereby, and shall not be deemed a representation by such officer as an
individual.
3. Purchase, Sale and Delivery of the Securities.
(a) On the basis of the representations, warranties,
agreements and covenants herein contained and subject to the terms and
conditions herein set forth, the Issuers agree to issue and sell to the Initial
Purchasers, and the Initial Purchasers agree to purchase from the Issuers, at
104.5% of their principal amount, the Securities. One or more certificates in
definitive form for the Securities that the Initial Purchasers
16
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have agreed to purchase hereunder, and in such denomination or denominations and
registered in such name or names as the Initial Purchasers request upon notice
to the Issuers at least 48 hours prior to the Closing Date, shall be delivered
by or on behalf of the Company, against payment by or on behalf of the Initial
Purchasers of the purchase price therefor by wire transfer or check of
immediately available funds to the account of the Company. Such delivery of and
payment for the Securities shall be made at the offices of Xxxxxx, Xxxxxx &
Xxxxxxx, 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 10:00 A.M., New York time,
on March 26, 1997, or at such other place, time or date as the Initial
Purchasers and the Issuers may agree upon, such time and date of delivery
against payment being herein referred to as the "Closing Date." The Issuers will
make such certificate or certificates for the Securities available for checking
and packaging by the Initial Purchasers at the offices in New York, New York of
BT Securities Corporation at least 24 hours prior to the Closing Date.
(b) The obligation of the Company and the Subsidiary
Guarantors to issue and sell, and the obligations of the Initial Purchasers to
purchase, the Securities hereunder shall be subject to the conditions that the
Agent and the Requisite Lenders (as defined in the Credit Facility) shall have
approved the terms thereof in accordance with the Third Amendment, Consent and
Waiver dated as of March 8, 1996 under the Credit Facility, as amended by the
Fourth Amendment dated as of November 7, 1996.
4. Offering by the Initial Purchasers. The Initial Purchasers
propose to make an offering of the Securities at the price and upon the terms
set forth in the Final Memorandum, as soon as practicable after this Agreement
is entered into and as in the judgment of the Initial Purchasers is advisable.
5. Certain Covenants. Each Issuer jointly and severally covenants
and agrees with the Initial Purchasers that:
(i) The Issuers will not amend or supplement the Final
Memorandum or any amendment or supplement thereto of which the Initial
Purchasers shall not previously have been advised and furnished a copy
for a reasonable period of time prior to the proposed amendment or
supplement and as to which the Initial Purchasers shall not have given
their consent (which consent shall not be unreasonably withheld). The
Issuers will promptly, upon the reasonable request of the Initial
Purchasers or counsel
17
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for the Initial Purchasers, make any amendments or supplements to the
Preliminary Memorandum or the Final Memorandum that may be necessary in
connection with the resale of the Securities by the Initial Purchasers
for such Memorandum not to contain any untrue statement of a material
fact or omission of a material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading or to comply with applicable laws, rules or regulations.
(ii) Each Issuer will cooperate with the Initial Purchasers
in arranging for the qualification of the Securities for offering and
sale under the securities or "Blue Sky" laws of such jurisdictions as
the Initial Purchasers may designate and will continue such
qualifications in effect for as long as may be necessary to complete the
resale of the Securities by the Initial Purchasers; provided, however,
that in connection therewith no Issuer shall be required to qualify as a
foreign corporation or to execute a general consent to service of
process in any jurisdiction or, except at the expense of the Initial
Purchasers, to keep any state qualification effective after one year.
(iii) If, at any time prior to the completion of the initial
resale by the Initial Purchasers of the Securities, any event shall
occur as a result of which it is necessary, in the opinion of counsel
for the Initial Purchasers, to amend or supplement the Final Memorandum
in order to make the Final Memorandum not misleading in light of the
circumstances existing at the time it is delivered to a purchaser, or if
for any other reason it shall be necessary to amend or supplement the
Final Memorandum in order to comply with applicable law, the Issuers
shall (subject to Section 5(i)) forthwith amend or supplement the Final
Memorandum (in form and substance reasonably satisfactory to counsel for
the Initial Purchasers and in compliance with applicable law) so that,
as so amended or supplemented, the Final Memorandum will not include an
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in light of the
circumstances existing at the time it is delivered to a purchaser, not
misleading and will comply with applicable law, and the Issuers will
18
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furnish to the Initial Purchasers a reasonable number of copies of such
amendment or supplement.
(iv) The Issuers will, without charge, provide to the Initial
Purchasers and to counsel for the Initial Purchasers as many copies of
the Preliminary Memorandum or the Final Memorandum or any amendment or
supplement thereto as the Initial Purchasers may reasonably request.
(v) For so long as any of the Securities remain outstanding,
the Company will furnish to the Initial Purchasers copies of all reports
and other communications (financial or otherwise) furnished by the
Company to the Trustee or to the holders of the Securities and, as soon
as available, copies of any reports or financial statements furnished to
or filed by the Company with the Commission or any national securities
exchange on which any class of securities of the Company may be listed.
(vi) Neither the Company nor any of its Affiliates will sell,
offer for sale or solicit offers to buy or otherwise negotiate in
respect of any "security" (as defined in the Act) which could be
integrated with the sale of the Securities in a manner which would
require the registration under the Act of the Securities.
(vii) The Company will not, and will not permit any of its
subsidiaries to, engage in any form of general solicitation or general
advertising (as those terms are used in Regulation D under the Act) in
connection with the offering of the Securities or in any manner
involving a public offering within the meaning of Section 4(2) of the
Act.
(viii) For so long as any of the Securities remain outstanding,
the Company will make available at its expense, upon request, to any
holder of Securities and any prospective purchasers thereof the
information specified in Rule 144A(d)(4) under the Act, unless the
Company is then subject to Section 13 or 15(d) of the Exchange Act.
(ix) The Company will use its best efforts to (i) permit the
Securities to be designated PORTAL securities in accordance with the
rules and regula-
19
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tions adopted by the NASD relating to trading in the Private Offerings,
Resales and Trading through Automated Linkages market (the "Portal
Market") and (ii) permit the Securities to be eligible for clearance and
settlement through The Depository Trust Company.
(x) The Company will apply the net proceeds from the sale of
the Securities as set forth under "Use of Proceeds" in the Final
Memorandum.
(xi) Prior to the Closing Date, the Issuers will furnish to
the Initial Purchasers, as soon as they have been prepared by or are
available to the Issuers, a copy of any unaudited interim consolidated
financial statements of the Company and its subsidiaries, for any period
subsequent to the period covered by the most recent financial statements
appearing in the Final Memorandum.
6. Expenses. The Issuers jointly and severally agree to pay all
costs and expenses incident to the performance of their respective obligations
under this Agreement, whether or not the transactions contemplated herein are
consummated or this Agreement is terminated pursuant to Section 11 hereof,
including all costs and expenses incident to (i) the printing, word processing
or other production of documents with respect to such transactions, including
any costs of printing the Preliminary Memorandum and the Final Memorandum and
any amendment or supplement thereto, and any "Blue Sky" memoranda, (ii) all
arrangements relating to the delivery to the Initial Purchasers of copies of the
foregoing documents, (iii) the fees and disbursements of the counsel, the
accountants and any other experts or advisors retained by any Issuer, (iv) the
preparation, issuance and delivery to the Initial Purchasers of any certificates
evidencing the Securities and the Guarantees, including trustees' fees, (v) the
qualification of the Securities under state securities and "Blue Sky" laws,
including filing fees and reasonable fees and disbursements of counsel for the
Initial Purchasers relating thereto, (vi) expenses of the Issuers in connection
with any meetings with prospective investors in the Securities, (vii) fees and
expenses of the Trustee including fees and expenses of its counsel, (viii) all
expenses and listing fees incurred in connection with the application for
quotation of the Securities on the PORTAL Market, and (ix) any fees charged by
investment rating agencies for the rating of the Securities. Notwithstanding any
of the foregoing, the Company will not be responsible for any of the fees and
expenses of the
20
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Initial Purchasers (including, without limitation, fees and disbursements of
counsel for the Initial Purchasers) incurred in connection with the transactions
contemplated hereby.
7. Conditions of the Initial Purchasers' Obligations. The
obligations of the Initial Purchasers to purchase and pay for the Securities are
subject to the accuracy of the representations and warranties contained herein,
to the performance by each Issuer of its covenants and agreements hereunder and
to the following additional conditions:
(i) The Initial Purchasers shall have received opinions in
form and substance satisfactory to the Initial Purchasers, dated the
Closing Date, of (a) Xxxxxx & Xxxxxxx, special counsel for the Issuers,
substantially in the form of Exhibit B hereto, and (b) Xxxxx, Clutter &
Xxxxxxxx, special Kansas counsel to the Issuers, substantially in the
form of Exhibit C hereto.
(ii) The Initial Purchasers shall have received an opinion,
dated the Closing Date, of Xxxxxx Xxxxxx & Xxxxxxx, counsel for the
Initial Purchasers, with respect to the sufficiency of certain corporate
proceedings and other legal matters relating to this Agreement, and such
other related matters as the Initial Purchasers may require. In
rendering such opinion, Xxxxxx Xxxxxx & Xxxxxxx shall have received and
may rely upon such certificates and other documents and information as
they may reasonably request to pass upon such matters. In addition, in
rendering their opinion, Xxxxxx Xxxxxx & Xxxxxxx may state that their
opinion is limited to matters of New York, Delaware corporate and
federal law.
(iii) The Initial Purchasers shall have received, from Xxxxxx
Xxxxxxxx LLP, independent public accountants for the Issuers, letters
dated, respectively, the date hereof and the Closing Date, in form and
substance satisfactory to the Initial Purchasers and Xxxxxx Xxxxxx &
Xxxxxxx, counsel for the Initial Purchasers.
(iv) The Initial Purchasers shall have received from KPMG
Peat Marwick, independent public accountants for Ralphs Supermarkets,
Inc., letters dated, respectively, the date hereof and the Closing Date,
in form and substance satisfactory to the Ini-
21
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tial Purchasers and Xxxxxx Xxxxxx & Xxxxxxx, counsel for the Initial
Purchasers.
(v) The representations and warranties of each Issuer
contained in this Agreement shall be true and correct in all material
respects on and as of the Closing Date (other than to the extent any
such representation or warranty is expressly made as to a certain date);
each Issuer shall 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 subsequent to the date of the most recent
financial statements in the Final Memorandum, there shall have been no
material adverse change in the business, condition (financial or other)
or results of operations of the Company and its subsidiaries taken as a
whole (a "Material Adverse Change"), or any development involving a
prospective Material Adverse Change, except as set forth in, or
contemplated by, the Final Memorandum.
(vi) Neither the issuance and sale of the Securities pursuant
to this Agreement nor any of the other transactions contemplated by the
Final Memorandum shall be enjoined (temporarily or permanently) and no
restraining order or other injunctive order shall have been issued or
any action, suit or proceeding shall have been commenced with respect to
this Agreement or any of the transactions contemplated by the Final
Memorandum, before any court or governmental authority.
(vii) The Initial Purchasers shall have received a
certificate, dated the Closing Date, of the Vice Chairman, President or
any Vice President (and with respect to (B) below, the Chief or
Principal Financial Officer) of the Company to the effect that:
(A) The representations and warranties of each Issuer in
this Agreement are true and correct in all material respects as
if made on and as of the Closing Date, and each Issuer has
performed all covenants and agreements and satisfied all
conditions on its part to be performed or satisfied at or prior
to the Closing Date after giving effect to the transactions
contemplated hereby and in the Final Memorandum;
22
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(B) Subsequent to the date as of which information is
given in the Final Memorandum, there has not been any Material
Adverse Change;
(C) Neither the sale of the Securities by the Issuers nor
any of the other transactions contemplated hereby or by the Final
Memorandum has been enjoined (temporarily or permanently); and
(D) The Issuers have obtained the approval of the Agent
and the Requisite Lenders (as defined in the Credit Facility)
regarding the offering of the Notes and the application of the
proceeds thereof such approval remains in full force and effect.
(viii) On the Closing Date, the Initial Purchasers shall have
received the Registration Rights Agreement executed by the Issuers and
such agreement shall be in full force and effect at all times from and
after the Closing Date.
On or before the Closing Date, the Initial Purchasers and counsel
for the Initial Purchasers shall have received such further documents, opinions,
certificates and schedules or instruments relating to the business, corporate,
legal and financial affairs of the Issuers as they shall have heretofore
reasonably requested from the Issuers.
All such opinions, certificates, letters, schedules, documents or
instruments delivered pursuant to this Agreement will comply with the provisions
hereof only if they are reasonably satisfactory in all material respects to the
Initial Purchasers and counsel for the Initial Purchasers. The Issuers shall
furnish to the Initial Purchasers such conformed copies of such opinions,
certificates, letters, schedules, documents and instruments in such quantities
as the Initial Purchasers shall reasonably request.
8. Offering of Securities; Restrictions on Transfer. The Initial
Purchasers represent and warrant that they are QIBs. The Initial Purchasers
agree with the Issuers that (i) they have not and will not solicit offers for,
or offer or sell, the Securities by any form of general solicitation or general
advertising (as those terms are used in Regulation D under the Act) or in any
manner involving a public offering within the meaning of Section 4(2) of the
Act; and (ii) they have and will solicit offers for the Securities only from,
and will offer the Securities only to, (A) in the case of offers
23
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inside the United States persons whom the Initial Purchasers reasonably believe
to be QIBs or, if any such person is buying for one or more institutional
accounts for which such person is acting as fiduciary or agent, only when such
person has represented to the Initial Purchasers that each such account is a
QIB, to whom notice has been given that such sale or delivery is being made in
reliance on Rule 144A and, in each case, in transactions under Rule 144A and (B)
in the case of offers outside the United States, to persons other than U.S.
persons ("foreign purchasers," which term shall include dealers or other
professional fiduciaries in the United States acting on a discretionary basis
for foreign beneficial owners (other than an estate or trust); provided,
however, that, in the case of this clause (B), in purchasing such Securities
such persons are deemed to have represented and agreed as provided under the
caption "Transfer Restrictions" contained in the Final Memorandum.
9. Indemnification and Contribution. (a) Each Issuer jointly and
severally agrees to indemnify and hold harmless the Initial Purchasers, and each
person, if any, who controls any of the Initial Purchasers within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, against any losses,
claims, damages or liabilities, joint or several, to which such Initial
Purchasers or such controlling person may become subject under the Act, the
Exchange Act or otherwise, insofar as any such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon:
(i) any untrue statement or alleged untrue statement of any
material fact contained in (A) any Memorandum or any amendment or supplement
thereto or (B) any application or other document, or any amendment or
supplement thereto, executed by any Issuer or based upon written information
furnished by or on behalf of any Issuer filed in any jurisdiction in order to
qualify the Securities under the securities or "Blue Sky" laws thereof or
filed with any securities association or securities exchange (each an
"Application") or
(ii) the omission or alleged omission to state, in any Memorandum or
any amendment or supplement thereto, or any Application, a material fact
required to be stated therein or necessary to make the statements therein not
misleading,
24
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and will reimburse, as incurred, the Initial Purchasers and each such
controlling person for any legal or other expenses reasonably incurred by the
Initial Purchasers or such controlling person in connection with
investigating, defending against or appearing as a third-party witness in
connection with any such loss, claim, damage, liability or action; provided,
however, that none of the Issuers will be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of or is
based upon any untrue statement or alleged untrue statement or omission or
alleged omission made in any Memorandum or any amendment or supplement
thereto, or any Application in reliance upon and in conformity with written
information furnished to any Issuer by the Initial Purchasers specifically
for use therein; and provided, further, that neither the Company nor the
Subsidiary Guarantors will be liable to the Initial Purchasers or any person
controlling the Initial Purchasers with respect to any such untrue statement
or omission made in the Preliminary Memorandum that is corrected in the
Offering Memorandum (or any amendment or supplement thereto) if the person
asserting any such loss, claim, damage or liability purchased Securities from
the Initial Purchasers in reliance upon the Preliminary Memorandum but was
not sent or given a copy of the Offering Memorandum (as amended or
supplemented) at or prior to the written confirmation of the sale of such
Notes to such person, unless such failure to deliver the Offering Memorandum
(as amended or supplemented) was a result of noncompliance by the Company or
the Subsidiary Guarantors with Section 5(iv) of this Agreement. This
indemnity agreement will be in addition to any liability that any Issuer may
otherwise have to the indemnified parties. None of the Issuers will, without
the prior written consent of the Initial Purchasers, settle or compromise or
consent to the entry of any judgment in any pending or threatened claim,
action, suit or proceeding in respect of which indemnification from the
Initial Purchasers may be sought hereunder (whether or not the Initial
Purchasers or any person who controls any of the Initial Purchasers within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act is a
party to such claim, action, suit or proceeding), unless such settlement,
compromise or consent includes an unconditional release of the Initial
Purchasers and each such controlling person from all liability arising out of
such claim, action, suit or proceeding.
(b) The Initial Purchasers will indemnify and hold harmless each
Issuer, their respective directors, their respective officers and each
person, if any, who controls any Issuer within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act against any losses, claims,
damages or li-
25
-25-
abilities to which any Issuer or any such director, officer or controlling
person may become subject under the Act, 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 (i) any untrue statement or alleged untrue
statement of any material fact contained in any Memorandum or any amendment or
supplement thereto, or any Application or (ii) the omission or the alleged
omission to state therein a material fact required to be stated in any
Memorandum or any amendment or supplement thereto, or any Application, or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to any Issuer by the Initial
Purchasers specifically for use therein; and, subject to the limitation set
forth immediately preceding this clause, will reimburse, as incurred, any legal
or other expenses reasonably incurred by any Issuer or any such director,
officer or controlling person in connection with investigating or defending
against or appearing as a third-party witness in connection with any such loss,
claim, damage, liability or action in respect thereof. This indemnity agreement
will be in addition to any liability that the Initial Purchasers may otherwise
have to the indemnified parties. The Initial Purchasers will not, without the
prior written consent of the Company and any affected Subsidiary Guarantor,
settle or compromise or consent to the entry of any judgment in any pending or
threatened claim, action, suit or proceeding in respect of which indemnification
from the Company or any affected Subsidiary Guarantor may be sought hereunder
(whether or not the Company or any such affected Subsidiary Guarantor or any
person who controls the Company or any such affected Subsidiary Guarantor within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act is a
party to such claim, action, suit or proceeding), unless such settlement,
compromise or consent includes an unconditional release of the Company or any
such affected Subsidiary Guarantor and each such controlling person from all
liability arising out of such claim, action, suit or proceeding.
(c) Promptly after receipt by an indemnified party under this Section
9 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 this
Section 9, 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 this
Section 9. In case
26
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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; provided, however,
that if the defendants in any such action include both the indemnified party and
the indemnifying party and the indemnified party shall have reasonably concluded
that there may be one or more legal defenses available to it and/or other
indemnified parties that are different from or additional to those available to
the indemnifying party, then the indemnifying party shall not have the right to
direct the defense of such action on behalf of such indemnified party or parties
and such indemnified party or parties shall have the right to select separate
counsel to defend such action on behalf of such indemnified party or parties.
After notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof and approval by such indemnified party
of counsel appointed to defend such action, the indemnifying party will not be
liable to such indemnified party under this Section 9 for any legal or other
expenses, other than reasonable costs of investigation, subsequently incurred by
such indemnified party in connection with the defense thereof, unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the immediately preceding sentence (it being understood, however,
that in connection with such action the indemnifying party shall not be liable
for the expenses of more than one separate counsel (in addition to local
counsel) in any one action or separate but substantially similar actions in the
same jurisdiction arising out of the same general allegations or circumstances,
designated by the Initial Purchasers in the case of paragraph (a) of this
Section 9 or the Issuers in the case of paragraph (b) of this Section 9,
representing the indemnified parties under such paragraph (a) or paragraph (b),
as the case may be, who are parties to such action or actions) or (ii) the
indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party. After such notice from the
indemnifying party to such indemnified party, the indemnifying party will not be
liable for the costs and expenses of any settlement of such action effected by
such indemnified party without the consent of the indemnifying party, unless
such indemnified party waived its rights under this Section 9, in which case the
indemnified party may effect such a settlement without such consent.
27
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(d) In circumstances in which the indemnity agreement provided for in
the preceding paragraphs of this Section 9 is unavailable or insufficient to
hold harmless an indemnified party in respect of any losses, claims, damages or
liabilities (or actions in respect thereof), each indemnifying party, in order
to provide for just and equitable contribution, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages or liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect (i) the relative benefits received by the indemnifying
party or parties on the one hand and the indemnified party on the other from the
offering of the Securities or (ii) if the allocation provided by the foregoing
clause (i) is not permitted by applicable law, not only such relative benefits
but also the relative fault of the indemnifying party or parties on the one hand
and the indemnified party on the other in connection with the statements or
omissions or alleged statements or omissions that resulted in such losses,
claims, damages or liabilities (or actions in respect thereof). The relative
benefits received by the Issuers on the one hand and the Initial Purchasers on
the other shall be deemed to be in the same proportion as the total proceeds
from the offering (before deducting expenses other than underwriting discounts
and commissions) received by the Company bear to the total discounts and
commissions received by the Initial Purchasers. The relative fault of the
parties 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 Subsidiary Guarantors on the one hand, or the Initial Purchasers on the
other, the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission, and any other
equitable considerations appropriate in the circumstances. Each Issuer and
Initial Purchaser agrees that it would not be equitable if the amount of such
contribution were determined by pro rata or per capita allocation (even if the
Issuers on the one hand and the Initial Purchasers on the other hand were
treated as one entity for such purpose) or by any other method of allocation
that does not take into account the equitable considerations referred to in the
first sentence of this paragraph (d). Notwithstanding any other provision of
this paragraph (d), the Initial Purchasers shall not be obligated to make
contributions hereunder that in the aggregate exceed the total underwriting
discounts and commissions received by the Initial Purchasers under this
Agreement, less the aggregate amount of any damages that the Initial Purchasers
have otherwise been required to pay by reason of the untrue or alleged untrue
statements or the
28
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omissions or alleged omissions to state a material fact, and 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. For purposes of this paragraph (d), each person,
if any, who controls any of the Initial Purchasers within the meaning of Section
15 of the Act or Section 20 of the Exchange Act shall have the same rights to
contribution as the Initial Purchasers, and each director of each Issuer, each
officer of each Issuer and each person, if any, who controls any Issuer within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act, shall
have the same rights to contribution as each such Issuer.
10. Survival Clause. The respective representations, warranties,
agreements, covenants, indemnities and other statements of each Issuer, their
respective officers and the Initial Purchasers set forth in this Agreement or
made by or on behalf of them, respectively, pursuant to this Agreement shall
remain in full force and effect, regardless of (i) any investigation made by or
on behalf of any Issuer, any of their respective officers or directors, the
Initial Purchasers or any controlling person referred to in Section 9 hereof and
(ii) delivery of and payment for the Securities, and shall be binding upon and
shall inure to the benefit of, any successors, assigns, heirs, personal
representatives of the Issuers, the Initial Purchasers and indemnified parties
referred to in Section 9 hereof. The respective agreements, covenants,
indemnities and other statements set forth in Section 6 and 9 hereof shall
remain in full force and effect, regardless of any termination or cancellation
of this Agreement.
11. Termination. (a) This Agreement may be terminated in the sole
discretion of the Initial Purchasers by notice to the Issuers given prior to the
Closing Date in the event that any Issuer shall have failed, refused or been
unable to perform all obligations and satisfy all conditions on their respective
part to be performed or satisfied hereunder at or prior thereto or, if at or
prior to the Closing Date:
(i) Any Issuer shall have sustained any loss or interference with respect
to its businesses or properties from fire, flood, hurricane, earthquake,
accident or other calamity, whether or not covered by insurance, or from any
labor dispute or any legal or governmental proceeding, which loss or
interference has had or has a Material Adverse Effect, or there shall have
been any Material Adverse Change,
29
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or any development involving a prospective Material Adverse Change (including
without limitation a change in management or control of any Issuer), except
as described in or contemplated by the Final Memorandum (exclusive of any
amendment or supplement thereto);
(ii) trading in securities generally on the New York or American Stock
Exchange shall have been suspended or minimum or maximum prices shall have
been established on any such exchange;
(iii) a banking moratorium shall have been declared by New York or United
States authorities; or
(iv) there shall have been (A) an outbreak or escalation of hostilities
between the United States and any foreign power, (B) an outbreak or
escalation of any other insurrection or armed conflict involving the United
States or (C) any material change in the financial markets of the United
States which, in the sole judgment of the Initial Purchasers, makes it
impracticable or inadvisable to proceed with the offering or the delivery of
the Securities as contemplated by the Final Memorandum, as amended as of the
date hereof.
(b) Termination of this Agreement pursuant to this Section 11 shall be
without liability of any party to any other party except as provided in Section
10 hereof.
12. Notices. All communications hereunder shall be in writing and, if
sent to the Initial Purchasers, shall be mailed or delivered or telecopied and
confirmed in writing to the Initial Purchasers c/o BT Securities Corporation,
Xxx Xxxxxxx Xxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx XxXxxxxxx;
and with a copy to Xxxxxx Xxxxxx & Xxxxxxx, 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Xxxxxxx X. Xxxxxxxx, Esq. If sent to any Issuer, shall be
mailed, delivered or telegraphed and confirmed in writing to Ralphs Grocery
Company, 0000 Xxxx Xxxxxxx Xxxx., Xxxxxxx, Xxxxxxxxxx 00000, Attention: General
Counsel with a copy to Xxxxxx & Xxxxxxx, 000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000, Xxx
Xxxxxxx, Xxxxxxxxxx 00000, Attention: Xxxxxx X. Xxxxx, Esq.
13. Successors. This Agreement shall inure to the benefit of and be
binding upon the Initial Purchasers, each Issuer and their respective successors
and legal representatives,
30
-30-
and nothing expressed or mentioned in this Agreement is intended or shall be
construed to give any other person any legal or equitable right, remedy or claim
under or in respect of this Agreement, or any provisions herein contained; this
Agreement and all conditions and provisions hereof being intended to be and
being for the sole and exclusive benefit of such persons and for the benefit of
no other person except that (i) the indemnities of each Issuer contained in
Section 9 of this Agreement shall also be for the benefit of any person or
persons who control the Initial Purchasers within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act and (ii) the indemnities of the
Initial Purchasers contained in Section 9 of this Agreement shall also be for
the benefit of the directors of each Issuer, their respective officers and any
person or persons who control any Issuer within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act. No purchaser of Securities from the
Initial Purchasers will be deemed a successor because of such purchase.
14. APPLICABLE LAW. THE VALIDITY AND INTERPRETATION OF THIS AGREEMENT,
AND THE TERMS AND CONDITIONS SET FORTH HEREIN SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO
ANY PROVISIONS RELATING TO CONFLICTS OF LAW.
15. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
31
-31-
If the foregoing correctly sets forth our understanding, please
indicate your acceptance thereof in the space provided below for that purpose,
whereupon this letter shall constitute a binding agreement among each of the
Issuers and the Initial Purchasers.
Very truly yours,
RALPHS GROCERY COMPANY
By: /s/ XXXX XXXXXXXX
-------------------------------
Name: Xxxx Xxxxxxxx
Title: Chief Financial
Officer
ALPHA BETA COMPANY,
BAY AREA WAREHOUSE STORES, INC.,
XXXX MARKETS, INC.,
CALA CO.,
CALA FOODS, INC.,
XXXXXX'X, INC.,
FOOD 4 LESS OF CALIFORNIA, INC.,
FOOD 4 LESS MERCHANDISING, INC.,
FOOD 4 LESS OF SOUTHERN CALIFORNIA, INC.,
FOOD 4 LESS GM, INC.,
XXXXXXXX STORES, INC.,
as Subsidiary Guarantors
By: /s/ [ILLEGIBLE]
-------------------------------
Name:
Title:
32
-32-
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
BT SECURITIES CORPORATION
By: /s/ XXXXXXXXX X. XXXXXX
-------------------------------
Name:
Title:
CIBC WOOD GUNDY SECURITIES CORP.
By: /s/ XXXXXXX X. XXXXXXX
-------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Managing Director
CREDIT SUISSE FIRST BOSTON
By: /s/ G. XXXXX X. XXXXXXX, XX
-------------------------------
Name: Xxxxx X. Xxxxxxx, XX
Title: Managing Director
XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
By: [ILLEGIBLE]
-------------------------------
Name:
Title:
BANKERS TRUST INTERNATIONAL, PLC
By: [ILLEGIBLE]
-------------------------------
Name:
Title:
33
FOR
EXHIBIT A
SEE REG RIGHTS AGREEMENT
34
Exhibit B
Form of Opinion of Xxxxxx & Xxxxxxx
1. Each of Ralphs Grocery Company (the "Company") and the Subsidiary
Guarantors (other than Xxxxxx'x ) (collectively, the "Corporations") has been
duly incorporated and is validly existing and in good standing under the laws of
its state of incorporation with corporate power and authority to own or lease
its properties and to conduct its business as now conducted as described in the
Final Memorandum.
2. Each of the Company, Cala Co. and Food 4 Less of Southern
California, Inc. is duly qualified to do business as a foreign corporation in
California and is in good standing in California.
3. The Company or a subsidiary or subsidiaries of the Company own of
record in the aggregate 100% of the capital stock of each corporation that is a
Subsidiary Guarantor (other than Xxxxxx'x) and all such capital stock has been
duly authorized and validly issued and is fully paid and nonassessable.
4. Each of the Corporations has full corporate power and authority to
execute, deliver and perform each of its obligations under the Purchase
Agreement, the Indenture, the Notes, the Exchange Notes, the Private Exchange
Notes and the Guarantees and to issue the Notes, the Exchange Notes, the Private
Exchange Notes and the Guarantees to be issued by it pursuant to the Indenture.
5. Except as set forth in the Final Memorandum, to the best of such
counsel's knowledge, no holder of securities of the Corporations is entitled to
have such securities registered under a registration statement filed by the
Company pursuant to the Registration Rights Agreement.
6. To the best of our knowledge, there is no action, suit, proceeding
or investigation pending or threatened against or affecting any of the
Corporations or any of their respective properties or assets in any court or
before any governmental authority or arbitration board or tribunal that seeks to
restrain, enjoin, prevent the consummation of or otherwise challenge the
Purchase Agreement, the Registration Rights Agreement, the Indenture or the
issuance, sale and delivery of the Notes or the Guarantees.
35
7. The Indenture has been duly authorized, executed and delivered by
the Corporations and (assuming due authorization, execution and delivery by the
Trustee) is the legally valid and binding agreement of the Corporations,
enforceable against the Corporations in accordance with its terms; the Indenture
meets the requirements for qualification under the Trust Indenture Act of 1939,
as amended.
8. The Notes have been duly authorized by the Company for issuance
and, when executed and authenticated in accordance with the terms of the
Indenture and delivered to and paid for by the Initial Purchasers in accordance
with the terms of the Purchase Agreement, will be legally valid and binding
obligations of the Company, enforceable against the Company in accordance with
their terms.
9. The Exchange Notes and the Private Exchange Notes have been duly
and validly authorized by the Company and when the Exchange Notes and the
Private Exchange Notes have been duly executed and delivered by the Company in
accordance with the terms of the Registration Rights Agreement and the Indenture
(assuming the due authorization, execution and delivery of the Indenture by the
Trustee and due authentication and delivery of the Exchange Notes and the
Private Exchange Notes by the Trustee in accordance with the Indenture), will
constitute the valid and legally binding obligations of the Company, entitled to
the benefits of the Indenture, and enforceable against the Company in accordance
with their terms.
10. Each of the Purchase Agreement and the Registration Rights
Agreement has been duly authorized, executed and delivered by the Corporations;
the execution and delivery of the Purchase Agreement, the Registration Rights
Agreement, the Indenture, the Notes and the Guarantees by the Corporations, to
the extent each is a party thereto, and the issuance and sale of the Notes
pursuant to the Purchase Agreement and the making of the Guarantees pursuant to
the Indenture will not result in the violation by any Corporation of its
certificate or articles of incorporation or bylaws or any federal, New York,
California, or Delaware General Corporation Law statute, rule or regulation
known to us to be applicable to the Corporations (other than federal or state
securities laws, which are specifically addressed elsewhere herein) or in the
breach of or default by any Corporation under any of the material agreements or
court orders specifically directed to the Corporations (which material
agreements have been identified to us by an officer of such person as material
to such person), which conflict, xxxxx-
B-2
36
tion, breach or default would have a material adverse effect on the Company and
the Subsidiary Guarantors, taken as a whole.
11. The Company and the Subsidiary Guarantors have all requisite
corporate power and authority to execute, deliver and perform their obligations
under the Registration Rights Agreement; the Registration Rights Agreement has
been duly and validly authorized, executed and delivered by the Company and the
Subsidiary Guarantors and (assuming due authorization, execution and delivery
thereof by the Initial Purchasers) constitutes the valid and legally binding
agreement of the Company and the Subsidiary Guarantors and is enforceable
against the Company and the Subsidiary Guarantors and in accordance with its
terms.
12. To the best of our knowledge, no consent, approval, authorization
or order of, or filing with, any federal, New York, California, or Delaware
court or governmental agency or body is required for the issuance and sale of
the Notes by the Company pursuant to the Purchase Agreement and the making of
the Guarantees by the respective Subsidiary Guarantors (other than Xxxxxx'x)
pursuant to the Indenture, except such as may be required under state securities
laws in connection with the purchase and distribution of such Notes and
Guarantees by the Initial Purchasers.
13. We call your attention to the fact that the Purchase Agreement,
the Registration Rights Agreement, the Indenture, the Notes and the Guarantees
select the internal laws of the State of New York as the governing law. It is
our opinion that a New York State court or a federal court sitting in New York
will honor the parties' choice of the internal laws of the State of New York as
the law applicable to such documents.
14. The statements set forth in the Offering Memorandum under the
caption "Description of Notes", insofar as they purport to summarize certain
provisions of the Notes and the Indenture, provide fair summaries thereof and
are accurate in all material respects.
15. No registration under the Act of the Notes is required in
connection with the sale of the Notes to the Initial Purchasers as contemplated
by this Agreement and the Final Memorandum or in connection with the initial
resale of the Notes by the Initial Purchasers in accordance with Section 8 of
this Agreement, and prior to the commencement of the Exchange Offer (as defined
B-3
37
in the Registration Rights Agreement) or the effectiveness of the Shelf
Registration Statement (as defined in the Registration Rights Agreement), the
Indenture is not required to be qualified under the TIA, in each case assuming
(i) that the Initial Purchasers and the purchasers who buy such Notes in the
initial resale thereof are qualified institutional buyers as defined in Rule
144A promulgated under the Act ("QIBs"), (ii) the accuracy of the Initial
Purchasers' representations in Section 8 and those of the Corporations contained
in this Agreement regarding the absence of a general solicitation in connection
with the sale of such Notes to the Initial Purchasers and the initial resale
thereof, (iii) the due performance by the Initial Purchasers of the agreements
set forth in Section 8 hereof and (iv) compliance by the Initial Purchasers with
the transfer restrictions described under the caption "Transfer Restrictions" in
the Memorandum.
16. In addition, we have participated in conferences with officers and
other representatives of the Company and the Subsidiary Guarantors,
representatives of the independent public accountants for the company and the
Subsidiary Guarantors and your representatives, at which the contents of the
Final Memorandum and related matters were discussed and, although we are not
passing upon, and do not assume any responsibility for, the accuracy,
completeness or fairness of the statements contained in the Final Memorandum and
have not made any independent check or verification thereof, during the course
of such participation (relying as to materiality to a large extent upon the
statements of officers and the representatives of the Company and the Subsidiary
Guarantors), no facts came to our attention that caused us to believe that the
Final Memorandum, at the date thereof or at the Closing Date, contained an
untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading; it being
understood that we express no belief with respect to the financial statements,
schedules and other financial and statistical data included in the Memorandum.
B-4
38
Exhibit C
Form of Opinion of Xxxxx, Clutter & Xxxxxxxx
1. Xxxxxx'x is a corporation duly incorporated, validly existing and
in good standing under the laws of the State of Kansas, and has the requisite
corporate power and authority to own, lease and operate its properties and to
conduct its business as now conducted.
2. The authorized capital stock of Xxxxxx'x is 1,000 shares of common
stock, ten cents par value. As of the date herein, 1,000 shares of such common
stock are issued and outstanding, all of which are owned of record by the
Company. All such outstanding shares of stock have been duly authorized and
validly issued and are fully paid and nonassessable.
3. Xxxxxx'x has full corporate power and authority to execute,
deliver and perform its obligations under the Purchase Agreement, the
Registration Rights Agreement, the Indenture and the Guarantees pursuant
thereto.
4. Each of the Purchase Agreement, the Registration Rights Agreement,
the Indenture and the Guarantees has been duly authorized by all necessary
corporate action, executed and delivered by Xxxxxx'x.
5. The execution and delivery of the Purchase Agreement, the
Registration Rights Agreement, the Indenture and the issuance of the Guarantees
by Xxxxxx'x pursuant to the Indenture will not result in the violation of any
Kansas statute, rule or regulation (other than state securities laws) known to
us to be applicable to Xxxxxx'x, which violation would have a material adverse
effect on the Company and the Subsidiary Guarantors, taken as a whole. To the
best of our knowledge, no consent, approval, authorization or order of, or
filing with, any Kansas court or governmental agency or body is required for the
making of the Guarantees by Xxxxxx'x pursuant to the Indenture, except as such
as may be required under state securities laws.
C-1
