EXHIBIT 1.1
COLOR SPOT NURSERIES, INC.
$85,000,000
__% SENIOR SUBORDINATED NOTES DUE 2007
UNDERWRITING AGREEMENT
___________, 1997
BT Xxxx. Xxxxx Incorporated
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Ladies and Gentlemen:
Color Spot Nurseries, Inc., a Delaware corporation (the "Company"),
hereby confirms its agreement with each of you (collectively, the
"Underwriters"), as set forth below.
1. THE SECURITIES. Subject to the terms and conditions herein
contained, the Company proposes to issue and sell to the Underwriters
$85,000,000 aggregate principal amount of its __% Senior Subordinated Notes due
2007 (the "Securities"). The Securities are to be issued under an indenture
(the "Indenture") by and between the Company and U.S. Trust Company of
California, N.A., as trustee (the "Trustee").
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to and agrees with each of the Underwriters that:
(a) A registration statement on Form S-1 (File No. 333-37335)
with respect to the Securities has been prepared by the Company in conformity
with the requirements of the Securities Act of 1933, as amended (the "Act"), and
the Rules and Regulations (the "Rules and Regulations") of the Securities and
Exchange Commission (the "Commission") thereunder and has been filed with the
Commission. Copies of such registration statement, including any amendments
thereto, the preliminary prospectuses (meeting the requirements of the Rules and
Regulations) contained therein and the exhibits, financial statements and
schedules, as finally amended and revised, have heretofore been delivered by the
Company to you. Such registration statement, together with any registration
statement filed by the Company pursuant to Rule 462(b) of the Act, herein
referred to as the "Registration Statement," which shall be deemed to include
all information omitted therefrom in reliance upon Rule 430A and contained in
the Prospectus
referred to below, has become effective under the Act and no post-effective
amendment to the Registration Statement has been filed as of the date of this
Agreement. "Prospectus" means (a) the form of prospectus first filed with
the Commission pursuant to Rule 424(b) with respect to the Securities or (b)
the last preliminary prospectus included in the Registration Statement filed
prior to the time it becomes effective or filed pursuant to Rule 424(a) under
the Act that is delivered by the Company to the Underwriters for delivery to
purchasers of the Securities, together with the term sheet or abbreviated
term sheet filed with the Commission pursuant to Rule 424(b)(7) under the
Act. Each preliminary prospectus included in the Registration Statement prior
to the time it becomes effective is herein referred to as a "Preliminary
Prospectus."
(b) The Company has been duly organized and is validly existing
as a corporation in good standing under the laws of the State of Delaware, with
corporate power and authority to own or lease its properties and conduct its
business as described in the Registration Statement. The Company does not own
or control, directly or indirectly, any corporation, association or other entity
other than the subsidiaries listed in Exhibit 21 to Item 16(a) of the
Registration Statement. Each of the subsidiaries of the Company as listed in
Exhibit 21 to Item 16(a) of the Registration Statement (collectively, the
"Subsidiaries") has been duly organized and is validly existing as a corporation
in good standing under the laws of the jurisdiction of its incorporation with
corporate power and authority to own or lease its properties and conduct its
business as described in the Registration Statement. The Company and each of
the Subsidiaries are duly qualified to transact business in the jurisdictions
set forth opposite their names in Schedule I hereto and, to the best of the
Company's knowledge, in all other jurisdictions in which the conduct of their
business requires such qualification. The outstanding shares of capital stock
of each of the Subsidiaries have been duly authorized and validly issued, are
fully paid and non-assessable and are owned by the Company or another Subsidiary
free and clear of all liens, encumbrances and equities and claims, except as
described in the Registration Statement; and no options, warrants or other
rights to purchase, agreements or other obligations to issue or other rights to
convert any obligations into shares of capital stock or ownership interests in
the Subsidiaries are outstanding. On or prior to the Closing Date, CSN, Inc., a
Delaware corporation, shall be merged with and into the Company and all of the
business operations of the Company are conducted through the Company and its
subsidiaries.
(c) The information set forth under "Capitalization" in the
Prospectus is true and correct. The outstanding shares of capital stock of the
Company have been duly authorized and validly issued and are fully paid and
non-assessable and were not issued in violation of any preemptive or similar
rights; and except as disclosed in the Prospectus or, if the Prospectus is not
in existence, the most recent Preliminary Prospectus, all of the outstanding
shares of capital stock of the Company and each of the Subsidiaries are free and
clear of all liens, encumbrances, equities and claims or restrictions on
transferability (other than those imposed by the Act and the securities or "Blue
Sky" laws of certain jurisdictions) or voting. Except for the capital stock of
the Subsidiaries, the Company does not own, directly or indirectly, any shares
of stock or any other equity or long-term debt securities or have any equity
interest in any firm, partnership, joint venture or other entity. No holders of
securities of the Company are entitled to have such securities registered under
the Registration Statement.
2
(d) The Commission has not issued an order preventing or
suspending the use of any Prospectus relating to the proposed offering of the
Securities nor instituted proceedings for that purpose. The Registration
Statement contains, and the Prospectus and any amendments or supplements
thereto will contain, all statements which are required to be stated therein
by, and will conform to, the requirements of the Act and the Rules and
Regulations. The Registration Statement and any amendment thereto do not
contain, and will not contain, any untrue statement of a material fact and do
not omit, and will not omit, to state any material fact required to be stated
therein or necessary to make the statements therein not misleading. The
Prospectus and any amendments and supplements thereto do not contain, and
will not contain, any untrue statement of material fact; and do not omit, and
will not omit, to state any material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided, however, that the
Company makes no representations or warranties as to information contained in
or omitted from the Registration Statement or the Prospectus, or any such
amendment or supplement, in reliance upon, and in conformity with, written
information furnished to the Company by the Underwriters, specifically for
use in the preparation thereof, or to the Statement of Eligibility and
Qualification (Form T-1) under the Trust Indenture Act of 1939, as amended
and the rules and regulations of the Commission thereunder (the "Trust
Indenture Act"), of the Trustee filed as an exhibit to the Registration
Statement.
(e) The consolidated financial statements of the Company and the
Subsidiaries, together with related notes and schedules as set forth in the
Registration Statement, as well as the financial statements, together with
related notes and schedules, of Xxx Xxxxxxx, Inc., Lone Star Growers Co.,
Summersun Greenhouse Co., Xxxxx Greenhouses, LLC, Signature Trees, Xxxxx's
Wholesale Greenhouses, Inc., Sunnyside Plants, Inc. and Cracon Inc.
(collectively the "Acquired Entities") present fairly the financial position and
the results of operations and cash flows of the Company and the consolidated
Subsidiaries and the Acquired Entities, at the indicated dates and for the
indicated periods. Such financial statements and related schedules have been
prepared in accordance with generally accepted principles of accounting,
consistently applied throughout the periods involved, except as otherwise noted
therein, and all adjustments necessary for a fair presentation of results for
such periods have been made. The summary financial and statistical data
included in the Registration Statement presents fairly the information shown
therein and such data has been compiled on a basis consistent with the financial
statements presented therein and the books and records of the Company. The pro
forma financial statements and other pro forma financial information included in
the Registration Statement and the Prospectus present fairly the information
shown therein, have been prepared in accordance with the Commission's rules and
guidelines with respect to pro forma financial statements, have been properly
compiled on the pro forma bases described herein, and, in the opinion of the
Company, the assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the transactions or
circumstances referred to therein. No other financial statements or schedules
of the Company or any other entity are required to be included in the
Registration Statement pursuant to any requirement of the Act or any Rules or
Regulations, including Rule 3-05 of Regulation S-X.
3
(f) Xxxxxx Xxxxxxxx LLP, Xxxx Xxxxx LLP and Xxxxxx, Xxxxxxxxx,
Xxxx & Xxxxxxxx, P.C., who have certified certain of the financial statements
filed with the Commission as part of the Registration Statement, are independent
public accountants as required by the Act and the Rules and Regulations.
(g) There is no action, suit, claim or proceeding pending or, to
the knowledge of the Company, threatened against the Company or any of the
Subsidiaries before any court or administrative agency or otherwise which if
determined adversely to the Company or any of the Subsidiaries might result in
any material adverse change in the business, properties, assets, operations or
financial condition of the Company and of the Subsidiaries taken as a whole or
might prevent the consummation of the transactions contemplated hereby, except
as set forth in the Registration Statement.
(h) The Company and the Subsidiaries have good and marketable
title to all of the properties and assets reflected in the financial statements
(or as described in the Registration Statement) hereinabove described, subject
to no lien, mortgage, pledge, charge or encumbrance of any kind except those
reflected in such financial statements (or as described in the Registration
Statement) or which are not material in amount. The Company and the
Subsidiaries occupy their leased properties under valid and binding leases
conforming in all material respects to the description thereof set forth in the
Registration Statement.
(i) The Company and the Subsidiaries have filed all Federal,
State, local and foreign income tax returns which have been required to be filed
and have paid all taxes indicated by said returns and all assessments received
by them or any of them to the extent that such taxes have become due. All tax
liabilities have been adequately provided for in the financial statements of the
Company.
(j) Since the respective dates as of which information is given
in the Registration Statement, as it may be amended or supplemented, there has
not been any material adverse change or any development involving a prospective
material adverse change in or affecting the business, properties, assets,
operations or financial condition of the Company and the Subsidiaries taken as a
whole, whether or not occurring in the ordinary course of business, and there
has not been any material transaction entered into or any material transaction
that is probable of being entered into by the Company or the Subsidiaries, other
than transactions in the ordinary course of business and changes and
transactions described in the Registration Statement, as it may be amended or
supplemented. The Company and the Subsidiaries have no material contingent
obligations which are not disclosed in the Company's financial statements which
are included in the Registration Statement.
(k) Neither the Company nor any of the Subsidiaries is or with
the giving of notice or lapse of time or both will be, in violation of or in
default under its charter or bylaws or under any agreement, lease, contract,
indenture or other instrument or obligation to which it is a party or by which
it, or any of its properties, is bound or any statute, judgment, decree, order,
rule or regulation applicable to the Company or any Subsidiary and which default
is of material significance in respect of the condition, financial or otherwise,
of the Company and
4
the Subsidiaries taken as a whole or the business, properties, assets,
operations or financial condition of the Company and the Subsidiaries taken
as a whole. Except with respect to that certain Second Amended and Restated
Credit Facility, dated as of __________, 1997, as amended, the execution and
delivery of this Agreement and the consummation of the transactions herein
contemplated and the fulfillment of the terms hereof will not conflict with
or result in a breach of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust or other agreement or
instrument to which the Company or any Subsidiary is a party, or of the
charter or by-laws of the Company or any order, rule or regulation applicable
to the Company or any Subsidiary of any court or of any regulatory body or
administrative agency or other governmental body having jurisdiction which
conflict, breach or default could reasonably be expected to have a material
adverse effect on the Company.
(l) The Company and each of the Subsidiaries hold all material
licenses, certificates and permits from governmental authorities which are
necessary to the conduct of their businesses; and neither the Company nor any of
the Subsidiaries has infringed any patents, patent rights, trade names,
trademarks or copyrights, which infringement is material to the business of the
Company and the Subsidiaries taken as a whole. The Company knows of no material
infringement by others of patents, patent rights, trade names, trademarks or
copyrights owned by or licensed to the Company or any Subsidiary.
(m) Neither the Company nor any Subsidiary is an "investment
company" or an affiliated person of, or "promoter" or "principal underwriter"
for, an "investment company," as such terms are defined under the Investment
Company Act of 1940, as amended (the "1940 Act"), and the rules and regulations
of the Commission thereunder.
(n) The Company maintains a system of internal accounting
controls sufficient to provide reasonable assurances that (i) transactions are
executed in accordance with management's general or specific authorization; (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain accountability for assets; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(o) The Company and each of the Subsidiaries carry, or are
covered by, insurance in such amounts and covering such risks as is adequate for
the conduct of their respective businesses and the value of their respective
properties and as is customary for companies engaged in similar industries.
(p) The Company is in compliance in all material respects with
all presently applicable provisions of the Employee Retirement Income Security
Act of 1974, as amended, including the regulations and published interpretations
thereunder ("ERISA"); no "reportable event" (as defined in ERISA) has occurred
with respect to any "pension plan" (as defined in ERISA) for which the Company
would have any liability; the Company has not incurred and does not expect to
incur liability under (i) Title IV of ERISA with respect to
5
termination of, or withdrawal from, any "pension plan" or (ii) Sections 412
or 4971 of the Internal Revenue Code of 1986, as amended, including the
regulations and published interpretations thereunder (the "Code"); and each
"pension plan" for which the Company would have any liability that is
intended to be qualified under Section 401(a) of the Code is so qualified in
all material respects and nothing has occurred, whether by action or by
failure to act, which would cause the loss of such qualification.
(q) The Company confirms as of the date hereof that it is in
compliance with all provisions of Section 1 of Laws of Florida, Chapter 92-198,
AN ACT RELATING TO DISCLOSURE OF DOING BUSINESS WITH CUBA (Fla. Stat. ch.
517.075). The Company further agrees that if it commences engaging in business
with the government of Cuba or with any person or affiliate located in Cuba
after the date the Registration Statement becomes or has become effective with
the Commission or with the Florida Department of Banking and Finance (the
"Department"), whichever date is later, or if the information reported or
incorporated by reference in the Prospectus, if any, concerning the Company's
business with Cuba or with any person or affiliate located in Cuba changes in
any material way, the Company will provide the Department notice of such
business or change, as appropriate, in a form acceptable to the Department.
(r) The Securities have been duly authorized by the Company and,
when the Securities are executed by the Company and authenticated by the Trustee
in accordance with the provisions of the Indenture and delivered to and paid for
by the Underwriters in accordance with the terms of this Agreement, the
Securities will be entitled to the benefits of the Indenture and will constitute
valid and legally binding obligations of the Company enforceable in accordance
with their terms, except that the enforcement thereof may be subject to
(i) bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or
other similar laws now or hereafter in effect relating to creditors' rights
generally, and (ii) general principles of equity and the discretion of the court
before which proceeding therefor may be brought. The Company has all requisite
corporate power and authority to execute, deliver and perform its obligations
under the Indenture; the Indenture has been duly authorized by the Company and
qualified under the Trust Indenture Act and, when executed and delivered by the
Company (assuming the due authorization, execution and delivery by the Trustee),
will constitute a valid and legally binding agreement of the Company,
enforceable against the Company in accordance with its terms, except that the
enforcement thereof may be subject to (i) bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally and (ii) general principles of
equity and the discretion of the court before which any proceeding therefor may
be brought.
(s) The Company has all requisite corporate power and authority
to enter into this Agreement, to issue and deliver the Securities and to
consummate the transactions contemplated hereby. This Agreement has been duly
authorized, executed and delivered by the Company. No consent, approval,
authorization or order of any court or governmental agency or body is required
for the performance of this Agreement by the Company or the consummation by the
Company of the transactions contemplated hereby, except such as have been
obtained and
6
such as may be required under state securities or "Blue Sky" laws in
connection with the purchase and distribution of the Securities by the
Underwriters.
(t) Except as provided in the Prospectus (or, if the Prospectus
is not in existence, the most recent Preliminary Prospectus), there are no
consensual encumbrances or restrictions on the ability of any Subsidiary (i) to
pay dividends or make any other distributions on such Subsidiary's capital stock
or to pay any indebtedness owed to the Company or any other Subsidiary, (ii) to
make any loans or advances to, or investments in, the Company or any other
Subsidiary, or (iii) to transfer any of its property or assets to the Company or
any other Subsidiary.
(u) Neither the Company nor any agent acting on its behalf has
taken or will take any action that might cause this Agreement or the sale of the
Securities to violate Regulation G, T, U or X of the Board of Governors of the
Federal Reserve System, in each case as in effect, or as the same may hereafter
be in effect, on the Closing Date.
(v) The Securities, the Indenture, and this Agreement will
conform in all material respects to the descriptions thereof in the Prospectus
(or, if the Prospectus is not in existence, the most recent Preliminary
Prospectus).
3. PURCHASE, SALE AND DELIVERY OF THE SECURITIES. On the basis
of the representations, warranties, agreements and covenants herein contained
and subject to the terms and conditions herein set forth, the Company agrees
to issue and sell to the Underwriters, and each Underwriter agrees severally,
but not jointly, to purchase from the Company, at ____% of their principal
amount, $85,000,000 aggregate principal amount of the Securities.
Certificates in definitive form for the Securities that the Underwriters have
agreed to purchase hereunder, and in such denomination or denominations and
registered in such name or names as the Underwriters request upon notice to
the Company at least 48 hours prior to the Closing Date, shall be delivered
by or on behalf of the Company to the Underwriters, against payment by or on
behalf of the Underwriters of the purchase price therefor by wire transfer
payable in immediately available funds to the account of the Company. Such
delivery of and payment for the Securities shall be made at the offices of
_______________________________________________________, at 10:00 A.M.,
Eastern Standard Time, on ___________, 1997, or at such other place, time
or date as the Underwriters and the Company may agree upon or as the
Underwriters may determine pursuant to Section 7(a) hereof, such time and
date of delivery against payment being herein referred to as the "Closing
Date." The Company will make such certificate or certificates for the
Securities available for checking and packaging by the Underwriters at the
offices in New York, New York of BT Xxxx. Xxxxx at least 24 hours prior to
the Closing Date.
4. OFFERING BY THE UNDERWRITERS. After the Registration Statement
becomes effective, the Underwriters propose to offer for sale to the public the
Securities at the price and upon the terms set forth in the Prospectus.
7
5. COVENANTS OF THE COMPANY. The Company covenants and agrees with
the Underwriters that:
(a) The Company will use its best efforts to cause the
Registration Statement, if not effective at the time of execution of this
Agreement, and any amendments thereto, to become effective promptly. If
required, the Company will file the Prospectus and any amendment or supplement
thereto with the Commission in the manner and within the time period required by
Rule 424(b) under the Act. During any time when a prospectus relating to the
Securities is required to be delivered under the Act, (i) the Company will
comply with all requirements imposed upon it by the Act, the Rules and
Regulations and the Trust Indenture Act to the extent necessary to permit the
continuance of sales of or dealings in the Securities in accordance with the
provisions hereof and of the Prospectus, as then amended or supplemented, and
(ii) the Company will not file with the Commission the Prospectus or any
amendment or supplement to such Prospectus or any amendment to the Registration
Statement of which the Underwriters shall not previously have been advised and
furnished a copy for a reasonable period of time prior to the proposed filing
and as to which filing the Underwriters shall not have given their consents.
The Company will prepare and file with the Commission, in accordance with the
Act, the Rules and Regulations and the Trust Indenture Act, promptly upon the
reasonable request by the Underwriters or counsel for the Underwriters, any
amendments to the Registration Statement or amendments or supplements to the
Prospectus that may be necessary or advisable in connection with the
distribution of the Securities by the Underwriters, and will use its best
efforts to cause any such amendment to the Registration Statement to be declared
effective by the Commission promptly. The Company will advise the Underwriters,
promptly after it receives notice thereof, of the time when the Registration
Statement or any amendment thereto has been filed or declared effective or the
Prospectus or any amendment or supplement thereto has been filed and will
provide evidence satisfactory to the Underwriters of each such filing or
effectiveness.
(b) The Company will advise the Underwriters promptly (A) when
the Registration Statement or any post-effective amendment thereto shall have
become effective, (B) of receipt of any comments from the Commission, (C) of any
request of the Commission for amendment of the Registration Statement or for
supplement to the Prospectus or for any additional information, and (D) of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or the use of the Prospectus or of the institution of any
proceedings for that purpose. The Company will use its best efforts to prevent
the issuance of any such stop order preventing or suspending the use of the
Prospectus and to obtain as soon as possible the lifting thereof, if issued.
(c) The Company will deliver to, or upon the order of, the
Underwriters, from time to time, as many copies of any Preliminary Prospectus as
the Underwriters may reasonably request. The Company will deliver to, or upon
the order of, the Underwriters during the period when delivery of a Prospectus
is required under the Act, as many copies of the Prospectus in final form, or as
thereafter amended or supplemented, as the Underwriters may reasonably request.
The Company will deliver to the Underwriters at or before the Closing Date, one
copy of the Registration Statement and all amendments thereto
8
including all exhibits filed therewith, and will deliver to the Underwriters
such number of copies of the Registration Statement (including such number of
copies of the exhibits filed therewith that may reasonably be requested), and
of all amendments thereto, as the Underwriters may reasonably request.
(d) If during the period in which a prospectus is required by
law to be delivered by an Underwriter or dealer, any event shall occur as a
result of which, in the judgment of the Company or in the reasonable opinion of
the Underwriters, it becomes necessary to amend or supplement the Prospectus in
order to make the statements therein, in the light of the circumstances existing
at the time the Prospectus is delivered to a purchaser, not misleading, or, if
it is necessary at any time to amend or supplement the Prospectus to comply with
any law, the Company promptly will prepare and file with the Commission an
appropriate amendment to the Registration Statement or supplement to the
Prospectus so that 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 the law.
(e) The Company will make generally available to its security
holders, as soon as it is practicable to do so, but in any event not later than
15 months after the effective date of the Registration Statement, an earning
statement (which need not be audited) in reasonable detail, covering a period of
at least 12 consecutive months beginning after the effective date of the
Registration Statement, which earning statement shall satisfy the requirements
of Section 11(a) of the Act and Rule 158 of the Rules and Regulations and will
advise you in writing when such statement has been so made available.
(f) The Company will, for a period ending on the date no
Securities are outstanding, deliver to the Underwriters copies of annual reports
and copies of all other documents, reports and information furnished by the
Company to the Trustee or its stockholders or filed with any securities exchange
pursuant to the requirements of such exchange or with the Commission pursuant to
the Act or the Exchange Act. During such time, the Company will deliver to the
Underwriters similar reports with respect to significant subsidiaries, as that
term is defined in the Rules and Regulations, which are not consolidated in the
Company's financial statements.
(g) The Company shall apply the net proceeds of its sale of the
Securities as set forth under "Use of Proceeds" in the Prospectus.
(h) The Company shall not invest, or otherwise use the proceeds
received by the Company from its sale of the Securities in such a manner as
would require the Company or any of the Subsidiaries to register as an
"investment company" under the 1940 Act and the rules and regulations
thereunder.
(i) The Company will cooperate with the Underwriters in
arranging for the qualification of the Securities for offering and sale under
the securities or "Blue Sky" laws of such jurisdictions as the Underwriters may
designate and will continue such qualifications in effect for as long as may be
necessary to complete the distribution of the Securities; PROVIDED, HOWEVER,
that in connection therewith the Company shall not be required to
9
qualify as a foreign corporation or to execute a general consent to service
of process in any jurisdiction.
(j) Prior to the Closing Date, the Company will furnish to the
Underwriters, as soon as they have been prepared, a copy of any unaudited
interim consolidated financial statements of the Company for any period
subsequent to the period covered by its most recent financial statements
appearing in the Registration Statement and Prospectus.
(k) The Company will not take, directly or indirectly, any
action designed to cause or result in, or that has constituted or might
reasonably be expected to constitute, the stabilization or manipulation of
the price of any securities of the Company.
6. EXPENSES. The Company agrees to pay all costs and expenses
incident to the performance of its obligations under this Agreement, whether or
not the transactions contemplated herein are consummated or this Agreement is
terminated pursuant to Section 10 hereof, including all costs and expenses
incident to (i) the printing, word processing or other production of documents
with respect to the transactions, including any costs of printing the
registration statement originally filed with respect to the Securities and any
amendment thereto, any Preliminary Prospectus and the Prospectus and any
amendment or supplement thereto, and any "Blue Sky" memoranda, (ii) all
arrangements relating to the delivery to the Underwriters of copies of the
foregoing documents, (iii) the fees and disbursements of the counsel, the
accountants and any other experts or advisors retained by the Company,
(iv) preparation (including printing), issuance and delivery to the Underwriters
of the Securities, including trustee's fees, (v) the qualification of the
Securities under state securities and "Blue Sky" laws, including filing fees and
fees and disbursements of counsel for the Underwriters relating thereto,
(vi) the filing fees of the Commission and the National Association of
Securities Dealers, Inc. relating to the Securities (including the fees,
disbursements and charges of counsel to the Underwriters in connection
therewith), (vii) expenses of the Company in connection with any meetings with
prospective investors in the Securities, (viii) fees and expenses of the
Trustee, including fees and expenses of counsel and (ix) any fees charged by
investment rating agencies for the rating of the Securities. If the sale of the
Securities provided for herein is not consummated because any condition to the
obligations of the Underwriters set forth in Section 7 hereof is not satisfied,
because this Agreement is terminated pursuant to Section 10 hereof or because of
any failure, refusal or inability on the part of the Company to perform all
obligations and satisfy all conditions on its part to be performed or satisfied
hereunder other than by reason of a default by the Underwriters, the Company
will reimburse the Underwriters upon demand (accompanied by documentation) for
all out-of-pocket expenses (including counsel fees and disbursements) that shall
have been incurred by the Underwriters in connection with the proposed purchase
and sale of the Securities.
7. CONDITIONS OF THE UNDERWRITERS' OBLIGATIONS. The obligation of
the Underwriters to purchase and pay for the Securities shall, in their sole
discretion, be subject to the following conditions:
10
(a) If the registration statement originally filed with respect
to the Securities or any amendment thereto filed prior to the Closing Date has
not been declared effective as of the time of execution hereof, the Registration
Statement or such amendment shall have been declared effective not later than
10:00 a.m., New York City time, on the date on which the amendment to the
registration statement originally filed with respect to the Securities or to the
Registration Statement, as the case may be, containing information regarding the
initial public offering price of the Securities has been filed with the
Commission, or such later time and date as shall have been consented to by the
Underwriters; if required, the Prospectus and any amendment or supplement
thereto shall have been filed in accordance with Rule 424(b) under the Act; no
stop order suspending the effectiveness of the Registration Statement or any
amendment thereto or the qualification of the Indenture under the Trust
Indenture Act shall have been issued and no proceedings for those purposes shall
have been instituted or, to the knowledge of the Company or the Underwriters,
threatened or are contemplated by the Commission; and the Company shall have
complied with or satisfactorily responded to any request of the Commission for
additional information.
(b) The Underwriters shall have received an opinion in form and
substance satisfactory to the Underwriters, dated the Closing Date, of
Brownstein, Hyatt, Xxxxxx & Xxxxxxxxxx, P.C., counsel for the Company,
substantially in the form of Exhibit A hereto.
(c) The Underwriters shall have received an opinion, dated the
Closing Date, of Xxxxxx & Xxxxxxx, counsel for the Underwriters, with respect to
certain legal matters relating to this Agreement, and such other related matters
as the Underwriters may require. In rendering such opinion, 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 & Xxxxxxx may state that their
opinion is limited to matters of New York and Delaware General Corporation Law
and federal law.
(d) The Underwriters shall have received from Xxxxxx
Xxxxxxxx LLP, Xxxx Xxxxx LLP and Xxxxxx, Xxxxxxxxx, Xxxx & Xxxxxxx, P.C., a
letter or letters dated, respectively, the date hereof and the Closing Date,
each in form and substance satisfactory to the Underwriters.
(e) The representations and warranties of the Company contained
in this Agreement shall be true and correct in all material respects as of the
date hereof and as of the Closing Date; the Company shall have performed all
covenants and agreements and satisfied all conditions on its part to be
performed or satisfied hereunder at or prior to the Closing Date; and subsequent
to the date of the most recent financial statements in the Prospectus, there
shall have been no material adverse change in the business, properties, assets,
operations or financial condition of the Company and the Subsidiaries, taken as
a whole, except as set forth in, or contemplated by, the Registration Statement
and the Prospectus.
11
(f) The sale of the Securities by the Company hereunder shall
not be enjoined (temporarily or permanently) on the Closing Date.
(g) Subsequent to the effective date of the Registration
Statement, there shall not have occurred any material adverse change, or any
event that would have a material adverse effect on the business, properties,
assets, operations or financial condition of the Company and the Subsidiaries,
taken as a whole.
(h) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, except in each case
as described in or as contemplated by the Prospectus, none of the Company or any
of the Subsidiaries shall have incurred any liabilities or obligations, direct
or contingent (other than in the ordinary course of business) that are material
to the Company and the Subsidiaries, taken as a whole, or entered into any
transactions not in the ordinary course of business that are material to the
business, properties, assets, operations or financial condition of the Company
and the Subsidiaries, taken as a whole, and, other than as contemplated by the
Prospectus, there shall not have been any change in the capital stock or long-
term indebtedness of the Company or the Subsidiaries that is material to the
business, properties, assets, operations or financial condition of the Company
and the Subsidiaries, taken as a whole.
(i) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, the conduct of the
business and operations of the Company or any of the Subsidiaries has not been
interfered with by strike, fire, flood, hurricane, accident or other calamity
(whether or not insured) or by any court or governmental action, order or
decree, and, except as otherwise stated therein, the properties of the Company
or any of the Subsidiaries have not sustained any loss or damage (whether or not
insured) as a result of any such occurrence, except any such interference, loss
or damage which would not have a material adverse effect on the business,
properties, assets, operations or financial condition of the Company and the
Subsidiaries, taken as a whole.
(j) The Underwriters shall have received a certificate, dated
the Closing Date, signed on behalf of the Company by its Chief Executive Officer
or President, and the Chief Financial Officer of the Company, on behalf of the
Company, to the effect that:
(i) The representations and warranties of the Company in
this Agreement are true and correct in all material respects as of the date
hereof and as if made on and as of the Closing Date, and the Company has
performed all covenants and agreements and satisfied hereunder all
conditions on its part to be performed or satisfied hereunder at or prior
to the Closing Date;
(ii) No stop order suspending the effectiveness of the
Registration Statement or any amendment thereto or the qualification of the
Indenture under the Trust Indenture Act has been issued, and no proceedings
for those purposes have been instituted or, to the knowledge of the
Company, threatened or are contemplated by the Commission;
12
(iii) Subsequent to the effective date of the
Registration Statement, there has not occurred any event or events that,
individually or in the aggregate, would have a material adverse effect on
the business, properties, assets, operations or financial condition of the
Company and the Subsidiaries, taken as a whole;
(iv) Subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus,
except in each case as described in or as contemplated by the Prospectus,
none of the Company or any of the Subsidiaries has incurred any liabilities
or obligations, direct or contingent (other than in the ordinary course of
business) that are material to the Company and the Subsidiaries, taken as a
whole, or entered into any transactions not in the ordinary course of
business that are material to the business, properties, assets, operations
or financial condition of the Company and the Subsidiaries, taken as a
whole, and, other than as contemplated by the Prospectus, there shall not
have been any change in the capital stock or long-term indebtedness of the
Company or the Subsidiaries that is material to the business, properties,
assets, operations or financial condition of the Company and the
Subsidiaries, taken as a whole;
(v) Subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus, the
conduct of the business and operations of the Company or any of the
Subsidiaries has not been interfered with by strike, fire, flood,
hurricane, accident or other calamity (whether or not insured) or by any
court or governmental action, order or decree, and, except as otherwise
stated therein, the properties of the Company or any of the Subsidiaries
have not sustained any loss or damage (whether or not insured) as a result
of such occurrence, except any such interference, loss or damage which
would not have a material adverse effect on the business, properties,
assets, operations or financial condition of the Company and the
Subsidiaries, taken as a whole; and
(vi) The sale of the Securities by the Company hereunder has
not been enjoined (temporarily or permanently).
On or before the Closing Date, the Underwriters and counsel for the
Underwriters shall have received such further documents, opinions, certificates
and schedules or instruments relating to the business, corporate, legal and
financial affairs of the Company as they shall have heretofore reasonably
requested from the Company.
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
Underwriters and counsel for the Underwriters. The Company shall furnish to the
Underwriters such conformed copies of such opinions, certificates, letters,
schedules, documents and instruments in such quantities as the Underwriters
shall reasonably request.
13
8. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company agrees to indemnify and hold harmless the
Underwriters, and each person, if any, who controls the Underwriters 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
Underwriters 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) the registration statement originally filed
with respect to the Securities or any amendment thereto or any Preliminary
Prospectus or the Prospectus or any amendment or supplement thereto or (B)
any application or other document, or any amendment or supplement thereto,
executed by the Company or based upon written information furnished by or
on behalf of the Company filed in any jurisdiction in order to qualify the
Securities under the securities or "Blue Sky" laws thereof or filed with
the Commission or any securities association or securities exchange (each
an "Application"); or
(ii) the omission or alleged omission to state, in such
registration statement or any amendment thereto, any Preliminary Prospectus
or the Prospectus 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,
and will reimburse, as incurred, the Underwriters and each such controlling
person for any legal or other expenses incurred by the Underwriters 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, the Company will not be liable
in any such case to the extent that any such loss, claim, damage, or liability
arises out of or is based upon any untrue statement or alleged untrue statement
or omission or alleged omission made in such registration statement or any
amendment thereto, any Preliminary Prospectus or the Prospectus or any amendment
or supplement thereto, or any Application in reliance upon and in conformity
with written information furnished to the Company by the Underwriters
specifically for use therein; and PROVIDED, FURTHER, that the Company will not
be liable to the Underwriters or any person controlling the Underwriters with
respect to any such untrue statement or omission made in any Preliminary
Prospectus that is corrected in the Prospectus (or any amendment or supplement
thereto) if the person asserting any such loss, claim, damage or liability
purchased Securities from the Underwriters in reliance upon the Preliminary
Prospectus but was not sent or given a copy of the Prospectus (as amended or
supplemented) at or prior to the written confirmation of the sale of such
Securities to such person in any case where such delivery of the Prospectus (as
so amended or supplemented) is required by the Act, unless such failure to
deliver the Prospectus (as amended or supplemented) was a result of
noncompliance by the Company with Section 5(c) of this Agreement. This
indemnity agreement will be in addition to any liability that the Company may
otherwise have to the indemnified parties. The Company shall
14
not be liable under this Section 8 for any settlement of any claim or action
effected without its consent, which shall not be unreasonably withheld.
(b) The Underwriters will indemnify and hold harmless each of
the Company, its directors, its officers who signed the Registration Statement
and each person, if any, who controls the Company within the meaning of Section
15 of the Act or Section 20 of the Exchange Act against any losses, claims,
damages or liabilities to which the Company 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 the Registration
Statement or any amendment thereto, any Preliminary Prospectus or the Prospectus
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 the Registration Statement or any amendment thereto, any Preliminary
Prospectus or the Prospectus 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 the Company by the
Underwriters specifically for use therein; and, subject to the limitation set
forth immediately preceding this clause, will reimburse, as incurred, any legal
or other expenses incurred by the Company 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 Underwriters may otherwise have to the
indemnified parties. The Underwriters shall not be liable under this Section 8
for any settlement of any claim or action effected without its consent, which
shall not be unreasonably withheld.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action for which such indemnified
party is entitled to indemnification under this Section 8, such indemnified
party will, if a claim in respect thereof is to be made against the indemnifying
party under this Section 8, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party (i) will not
relieve it from any liability under paragraph (a) or (b) above unless and to the
extent it did not otherwise learn of such action and such failure results in the
forfeiture by the indemnifying party of substantial rights and defenses and
(ii) will not, in any event, relieve the indemnifying party from any
obligations to any indemnified party other than the indemnification obligation
provided in paragraphs (a) and (b) above. In case any such action is brought
against any indemnified party, and it notifies the indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein and, to the extent that it may wish, jointly with any other indemnifying
party similarly notified, to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party; PROVIDED, HOWEVER, that if (i) the use
of counsel chosen by the indemnifying party to represent the indemnified party
would present such counsel with a conflict of interest, (ii) the defendants in
any such action include both the indemnified party and the indemnifying party
and the indemnified party shall have been advised by counsel that there may be
one or more legal defenses available to it and/or other indemnified parties that
15
are different from or additional to those available to the indemnifying party,
or (iii) the indemnifying party shall not have employed counsel reasonably
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of the institution of such action, then, in each
such case, 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 8 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 Underwriters in the case of paragraph (a) of this Section 8 or
the Company in the case of paragraph (b) of this Section 8, 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 in writing 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 in writing its rights under this Section 8, in which
case the indemnified party may effect such a settlement without such consent.]
(d) In circumstances in which the indemnity agreement provided
for in the preceding paragraphs of this Section 8 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 Company on the one hand and the
Underwriters on the other shall be deemed to be in the same proportion as the
total proceeds from the offering (before deducting expenses) received by the
Company bear to the total underwriting discounts and commissions received by the
Underwriters. The relative fault 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
16
relates to information supplied by the Company on the one hand, or the
Underwriters 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. The
Company and the Underwriters agree that it would not be equitable if the amount
of such contribution were determined by pro rata or per capita allocation 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 Underwriters
shall not be obligated to make contributions hereunder that in the aggregate
exceed the total underwriting discounts and commissions received by the
Underwriters under this Agreement, less the aggregate amount of any damages that
the Underwriters have otherwise been required to pay by reason of the untrue or
alleged untrue statements or the 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 the Underwriters 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 Underwriters, and each director of
the Company, each officer of the Company who signed the Registration Statement
and each person, if any, who controls the Company 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 Company.
9. SURVIVAL CLAUSE. The respective representations, warranties,
agreements, covenants, indemnities and other statements of the Company, its
officers and the Underwriters 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
the Company, any of its officers or directors, the Underwriters or any
controlling person referred to in Section 8 hereof and (ii) delivery of and
payment for the Securities. The respective agreements, covenants, indemnities
and other statements set forth in Sections 6 and 8 hereof shall remain in full
force and effect, regardless of any termination or cancellation of this
Agreement.
10. TERMINATION.
(a) This Agreement may be terminated in the sole discretion of
the Underwriters by notice to the Company given prior to the Closing Date in the
event that the Company shall have failed, refused or been unable to perform all
obligations and satisfy all conditions on its part to be performed or satisfied
hereunder at or prior thereto or, if at or prior to the Closing Date:
(i) the Company shall have sustained any loss or
interference with respect to its businesses or properties from fire, flood,
hurricane, 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, in the sole judgment of the Underwriters, has had or
has a material adverse effect the business, properties, assets, operations
or financial condition of the Company and the Subsidiaries, taken as a
whole,
17
or there shall have been, in the sole judgment of the Underwriters,
any material adverse change, or any development involving a prospective
material adverse change (including without limitation a change in
management or control of the Company), in the business, properties, assets,
operations or financial condition of the Company and the Subsidiaries,
taken as a whole, except in each case as described in or contemplated by
the Prospectus (exclusive of any amendment or supplement thereto);
(ii) trading in securities generally on the New York Stock
Exchange, American Stock Exchange or the Nasdaq National Market shall have
been suspended or minimum or maximum prices shall have been established on
any such exchange or trading in securities of the Company shall have been
suspended;
(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, or (B) an
outbreak or escalation of any other insurrection or armed conflict
involving the United States or any other national or international calamity
or emergency, or (C) any material change in the financial markets of the
United States which, in the sole judgment of the Underwriters, makes it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Securities as contemplated by the Registration Statement,
as amended as of the date hereof.
(b) Termination of this Agreement pursuant to this Section 10
shall be without liability of any party to any other party except as provided in
Section 9 hereof.
11. INFORMATION SUPPLIED BY THE UNDERWRITERS. The statements set
forth in the last paragraph on the cover page of the Prospectus, the
stabilization legend on the page following the cover page of the Prospectus and
the first, second, third, fourth, fifth and sixth paragraphs under the heading
"Underwriting" in the Prospectus (to the extent such statements relate to the
Underwriters) constitute the only information furnished by the Underwriters to
the Company for the purposes of Sections 2(b) and 8 hereof. The Underwriters
confirm that such statements (to the extent such statements relate to the
Underwriters) are correct.
12. NOTICES. All communications hereunder shall be in writing and,
if sent to the Underwriters, shall be mailed or delivered or telecopied and
confirmed in writing to (i) BT Xxxx. Xxxxx Incorporated, 000 Xxxxx Xxxxx Xxxxxx,
00xx Xxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000, Attention: Corporate Finance
Department; and (ii) Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation,
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxxxxxxx, Xxxxxxxxxx 00000; if sent to
the Company, shall be mailed or delivered or telecopied and confirmed in writing
to the Company at 0000 Xxxxxxx Xxxxxx, Xxxxxxxx Xxxx, Xxxxxxxxxx 00000,
Attention: Xxxxxxx Xxxxxxxx; with a copy to Xxxxxxxxxx Xxxxx Xxxxxx &
Xxxxxxxxxx, P.C., 000 Xxxxxxxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxx, Xxxxxxxx 00000,
Attention: Xxxxxx X. Xxxxxx, Esq.
18
13. SUCCESSORS. This Agreement shall inure to the benefit of and be
binding upon the Underwriters, the Company and their respective successors and
legal representatives, 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 the
Company contained in Section 8 of this Agreement shall also be for the benefit
of any person or persons who control the Underwriters within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act and (ii) the indemnities
of the Underwriters contained in Section 8 of this Agreement shall also be for
the benefit of the directors of the Company, its officers who have signed the
Registration Statement and any person or persons who control the Company within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act. No
purchaser of Securities from the Underwriters 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.
19
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 between the Company
and the Underwriters.
Very truly yours,
COLOR SPOT NURSERIES, INC.
By:
---------------------------
Name:
Title:
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
BT ALEX. BROWN INCORPORATED
By:
---------------------------
Name:
Title:
XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
By:
---------------------------
Name:
Title:
20
Exhibit A
Opinion of Brownstein, Hyatt, Xxxxxx & Xxxxxxxxxx, P.C.
(a) The Company has been duly organized and is validly existing
as a corporation in good standing under the laws of the State of Delaware, with
corporate power and authority to own or lease its properties and conduct its
business as described in the Registration Statement; to the knowledge of such
counsel, based solely upon a review of the corporate records of the Company, the
Company does not own or control, directly or indirectly, any corporation,
association or other entity other than the subsidiaries listed in Exhibit 21 to
Item 16(a) of the Registration Statement (the "Subsidiaries"); each of the
Subsidiaries has been duly organized and is validly existing as a corporation or
limited partnership in good standing under the laws of the jurisdiction of its
incorporation, with corporate or partnership power and authority to own or lease
its properties and conduct its business as described in the Registration
Statement (provided that such counsel need not express any opinion as to the
organization of Oda Nursery, Inc.); the Company and each of the Subsidiaries are
duly qualified to transact business in the jurisdictions set forth on Schedule I
hereto; the outstanding shares of capital stock of each of the Subsidiaries have
been duly authorized and validly issued and are fully paid and nonassessable
and, based solely upon the review of the corporate or partnership records of
each such Subsidiary, are owned by the Company or a Subsidiary; to the knowledge
of such counsel, based solely upon the review of the corporate or partnership
records of each such Subsidiary, the outstanding shares of capital stock of each
of the Subsidiaries are owned free and clear of all liens, encumbrances and
equities and claims (other than those in favor of Credit Agricole Indosuez, as
agent for the Company's senior lenders), and no options, warrants or other
rights to purchase, agreements or other obligations to issue or other rights to
convert any obligations into any shares of capital stock or of ownership
interests in the Subsidiaries are outstanding.
(b) The Company has authorized and outstanding capital stock as
set forth under the caption "Capitalization" in the Prospectus; the authorized
shares of the Company's Common Stock have been duly authorized; the outstanding
shares of the Company's Common Stock (i) issued in connection with that certain
Recapitalization dated as of December 31, 1996 (the "Recapitalization") and (ii)
issued since the date of the Recapitalization have been duly authorized and
validly issued and are fully paid and nonassessable. Based soley upon the
review of the Company's and the Subsidiaries' minute books, to such counsel's
knowlege, except as otherwise stated in the Prospectus, all of the outstanding
shares of capital stock of the Subsidiaries are owned, directly or indirectly,
by the Company, free and clear of all perfected security interests and, to the
knowledge of such counsel, free and clear of all other restrictions on
transferability (other than those imposed by the Act and the securities or "Blue
Sky" laws of certain jurisdictions) or voting.
(c) Except as described in or contemplated by the Prospectus, to
the knowledge of such counsel, based solely on the review of the corporate
minute book of the Company, there are no outstanding securities of the Company
convertible or exchangeable into or evidencing the right to purchase or
subscribe for any shares of capital stock of the Company
A-1
and there are no outstanding or authorized options, warrants or rights of any
character obligating the Company to issue any shares of its capital stock or
any securities convertible or exchangeable into or evidencing the right to
purchase or subscribe for any shares of such stock; and except as described
in the Prospectus, to the knowledge of such counsel, no holder of any
securities of the Company or any other person has the right, contractual or
otherwise, which has not been satisfied or effectively waived, to cause the
Company to sell or otherwise issue to them, or to permit them to underwrite
the sale of, any shares of Common Stock or the right to have any shares of
Common Stock or other securities of the Company included in the Registration
Statement or the right, as a result of the filing of the Registration
Statement, to require registration under the Act of any shares of Common
Stock or other securities of the Company.
(d) The Registration Statement has become effective under the
Act and, to the knowledge of such counsel, no stop order proceedings with
respect thereto have been instituted or are pending or threatened under the Act;
and any required filing of the Prospectus pursuant to Rule 424(b) under the Act
has been made in accordance with Rules 424(b) and 430A under the Act.
(e) The Registration Statement, the Prospectus and each
amendment or supplement thereto comply as to form in all material respects with
the requirements of the Act and the applicable rules and regulations thereunder
(except that such counsel need express no opinion as to the financial statements
and related schedules therein, including the notes thereto and supporting
schedules and other financial and statistical data included therein or omitted
therefrom, or with respect to the Form T-1).
(f) The statements under the captions "Risk Factors--Shares
Eligible for Future Sale," "Management--Compensation Committee Interlocks and
Insider Participation," "Management--Limitation on Directors' Liability and
Indemnification," "Description of Capital Stock," "Description of the Notes" and
"Shares Eligible for Future Sale" in the Prospectus, insofar as such statements
constitute a summary of documents referred to therein or matters of law, fairly
summarize in all material respects the information called for with respect to
such documents and matters.
(g) The information required to be set forth in the Registration
Statement in answer to Items 14 and 15 of Form S-1 to such counsel's knowledge
is accurately and adequately set forth therein in all material respects.
(h) Such counsel knows of no material legal or governmental
proceedings pending or threatened against the Company or any of the Subsidiaries
except as set forth in the Prospectus.
(i) The execution and delivery of the Underwriting Agreement and
the consummation of the transactions herein contemplated do not and will not
conflict with or result in a breach of any of the terms or provisions of, or
constitute a default under, the charter or bylaws of the Company, or any
agreement filed as an exhibit to the Registration Statement which the Company or
any of the Subsidiaries may be bound or of any federal or New York statute, rule
or regulation or Delaware General Corporation Law known to such counsel to be
applicable
A-2
to the Company (other than federal or state securities laws, which are
specifically addressed elsewhere herein) which conflict, breach or default
could reasonably be expected to have a material adverse effect on the Company.
(j) The Underwriting Agreement has been duly authorized,
executed and delivered by the Company.
(k) No approval, consent, order, authorization, designation,
declaration or filing by or with any regulatory, administrative or other
governmental body by the Company is necessary in connection with the execution
and delivery of the Underwriting Agreement and the consummation of the
transactions herein contemplated (other than as may be required by the NASD or
as required by state securities and Blue Sky laws as to which such counsel need
express no opinion) except such as have been obtained or made, specifying the
same.
(l) The Company is not, and will not become, as a result of the
consummation of the transactions contemplated by the Underwriting Agreement, and
application of the net proceeds therefrom as described in the Prospectus,
required to register as an "investment company" or an affiliated person of, or
"promoter" or "principal underwriter" for, an "investment company," as such
terms are defined in the 1940 Act and the rules and regulations thereunder.
(m) The Company has all requisite corporate power and authority
to execute, deliver and perform its obligations under the Indenture. The
Indenture has been duly and validly authorized, executed and delivered by the
Company and (assuming due authorization, execution and delivery by the Trustee)
is the legally valid and binding agreement of the Company, enforceable against
the Company in accordance with its terms.
(n) The Company has all requisite corporate power and authority
to execute, deliver and perform its obligations under the Notes. The Notes,
when executed and authenticated in accordance with the terms of the Indenture
and delivered to and paid for by the Underwriters in accordance with the terms
of the Underwriting Agreement, will be legally valid and binding obligations of
the Company, enforceable against the Company in accordance with their terms.
(o) The Indenture has been duly qualified under the Trust
Indenture Act.
(p) Neither the issuance, sale and delivery of the Notes, nor
the application of the proceeds thereof by the Company as set forth in the
Prospectus, will violate Regulations G, T, U or X promulgated by the Board of
Governors of the Federal Reserve System.
(q) CSN, Inc., a Delaware corporation, has been merged with and
into the Company, with the Company surviving such merger, under the General
Corporation Law of the State of Delaware.
A-3
In addition to the matters set forth above, such counsel shall also
furnish a separate written opinion to the effect that nothing has come to the
attention of such counsel which leads them to believe that (i) the Registration
Statement, at the time it became effective under the Act (but after giving
effect to any modifications incorporated therein pursuant to Rule 430A under the
Act) and as of 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 not misleading, and (ii) the
Prospectus, or any supplement thereto, on the date it was filed pursuant to the
Rules and Regulations and as of the Closing Date, contained an untrue statement
of a material fact or omitted to state a material fact necessary in order to
make the statements, in the light of the circumstances under which they are
made, not misleading (except that such counsel need express no opinion as to
financial statements and related schedules therein, including the notes thereto
and supporting schedules and other financial and statistical data included
therein or omitted therefrom, or with respect to the Form T-1). With respect to
such statement, such counsel may state that their belief is based upon the
procedures set forth therein, but is without independent check and verification.
A-4
