Exhibit 1.1
L-3 COMMUNICATIONS CORPORATION
__% SENIOR SUBORDINATED NOTES
FORM OF DEBT UNDERWRITING AGREEMENT
May __, 1998
XXXXXX BROTHERS INC.
BANCAMERICA XXXXXXXXX XXXXXXXX
c/x Xxxxxx Brothers Inc.
Three World Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
L-3 Communications Corporation, a Delaware corporation (the
"Company"), proposes to issue and sell to you (the "Underwriters") $150,000,000
in aggregate principal amount of its ___% Senior Subordinated Notes due 2008
(the "Notes") guaranteed (the "Guarantees") by Hygienetics Environmental
Services, Inc., a Delaware corporation, L-3 Communications ILEX Systems, Inc.,
a Delaware corporation, and Southern California Microwave, Inc., a California
corporation (collectively, the "Guarantors"), pursuant to the terms of an
Indenture (the "Indenture") between the Company and The Bank of New York as
trustee (the "Trustee"), relating to the Notes. As described in the Prospectus
(hereinafter defined), the Company will use the net proceeds from the sale of
the Notes to repay a substantial portion of its existing indebtedness and for
general corporate purposes, including potential acquisitions. This is to
confirm the agreement concerning the purchase of the Notes from the Company by
the Underwriters and the guarantee of such Notes by the Guarantors.
It is understood by all parties that, L-3 Communications
Holdings, Inc., the sole shareholder of the Company (the "Parent"), and the
Company, are concurrently entering into (i) an agreement dated the date hereof
(the "U.S. Underwriting Agreement") providing for the sale by the Company of
4,400,000 shares (the "Firm Stock") of the Parent's Common Stock, par value
$.01 per share ("Common Stock"), through arrangements with
certain underwriters inside the United States (the "U.S. Underwriters"), for
whom Xxxxxx Brothers Inc., Bear, Xxxxxxx & Co. Inc., Credit Suisse First Boston
Corporation, Xxxxxx Xxxxxxx & Co. Incorporated and X.X. Xxxxxxxxx, Towbin are
acting as representatives and (ii) an agreement dated the date hereof (the
"International Underwriting Agreement") providing for the sale by the Company
of 1,100,000 shares of the Parent's Common Stock (the "International Stock")
through arrangements with certain underwriters outside the United States (the
"International Managers"), for whom Xxxxxx Brothers International (Europe),
Bear, Xxxxxxx International Limited, Credit Suisse First Boston (Europe)
Limited, Xxxxxx Xxxxxxx & Co. International Limited and X.X. Xxxxxxxxx, Towbin
are acting as lead managers. In addition, the Parent proposes to grant to the
U.S. Underwriters an option under the U.S. Underwriting Agreement to purchase
up to an additional 825,000 shares of Common Stock ("the Option Stock" and,
together with the Firm Stock, the "U.S. Stock") on the terms and for the
purposes set forth in Section 2 of the U.S. Underwriting Agreement. The U.S.
Underwriters and the International Managers simultaneously are entering into an
agreement between the U.S. and international underwriting syndicates (the
"Agreement Between U.S. Underwriters and International Managers") which
provides for, among other things, the transfer of shares of Common Stock
between the two syndicates. Except as the context may otherwise require,
references herein to the Stock shall include all the shares of Common Stock
which may be sold pursuant to either the U.S. Underwriting Agreement or the
International Underwriting Agreement.
1. Representations, Warranties and Agreements of the Company
and the Guarantors. The Company and the Guarantors, jointly and severally
represent, warrant and agree that:
(a) A registration statement on Form S-1, and
amendments Xx. 0, Xx. 0, Xx. 0 and No. 4 thereto, with
respect to the Notes and the Guarantees have (i) been
prepared by the Company and the Guarantors in conformity with
the requirements of the United States Securities Act of 1933,
as amended (the "Securities Act") and the rules and
regulations (the "Rules and Regulations") of the United
States Securities and Exchange Commission (the "Commission")
thereunder, (ii) been filed with the Commission under the
Securities Act and (iii) become effective under the
Securities Act; and the Indenture shall be qualified under
the Trust Indenture Act of 1939 (the "Trust Indenture Act")
and the applicable rules and regulations thereunder. Copies
of such registration statement and the amendments thereto
have been delivered by the Company to you. As used in this
Agreement, "Effective Time" means the date and the time as of
which such registration statement, or the most recent
post-effective amendment thereto, if any, was declared
effective by the Commission; "Effective Date" means the date
of the Effective Time; "Preliminary Prospectus" means each
prospectus included in such registration statement, or
amendments thereof, before it became effective under the
Securities Act and any prospectus filed with the Commission
by the Company and the Guarantors with the consent of the
Underwriters pursuant to Rule 424(a) of the Rules and
Regulations; "Registration Statement" means such registration
statement, as amended at the Effective Time, including all
information contained in the final prospectus filed with the
Commission pursuant to Rule 424(b) of the Rules and
Regulations in accordance with Section 5 hereof and deemed to
be a part of the registration statement as of the Effective
Time pursuant to paragraph (b) of Rule 430A of the Rules and
Regulations; and "Prospectus" means such final prospectus, as
first filed with the Commission pursuant to paragraph (1) or
(4) of Rule 424(b) of the Rules and Regulations. If the
Company and the Guarantors have filed or are required
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pursuant to the terms hereof to file a registration statement
pursuant to Rule 462(b) under the Securities Act registering
additional Notes and Guarantees (a "Rule 462(b) Registration
Statement"), then, unless otherwise specified, any reference
herein to the term "Registration Statement" shall be deemed
to include such Rule 462(b) Registration Statement. The
Commission has not issued any order preventing or suspending
the use of any Preliminary Prospectus; and no stop order
suspending the effectiveness of the Registration Statement is
in effect, and no proceedings for such purpose are pending
before or threatened by the Commission. Any Rule 462(b)
Registration Statement filed after the effectiveness of this
Agreement will become effective no later than 10:00 P.M., New
York City time, on the date of this Agreement.
(b) The Registration Statement (other than any Rule
462(b) Registration Statement to be filed by the Company and
the Guarantors after the effectiveness of this Agreement)
conforms, and the Prospectus and any further amendments or
supplements to the Registration Statement (including, if the
Company and the Guarantors are required to file a Rule 462(b)
Registration Statement after the effectiveness of this
Agreement, such Rule 462(b) Registration Statement and any
amendments thereto) or the Prospectus will, when they become
effective or are filed with the Commission, as the case may
be, conform in all respects to the requirements of the
Securities Act and the Rules and Regulations and do not and
will not, as of the applicable effective date (as to the
Registration Statement and any amendment thereto) and as of
the applicable filing date (as to the Prospectus and any
amendment or supplement thereto) contain an untrue statement
of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements
therein not misleading; provided that no representation or
warranty is made as to information contained in or omitted
from the Registration Statement or the Prospectus in reliance
upon and in conformity with written information furnished to
the Company by any Underwriter specifically for inclusion
therein; and the Indenture conforms in all material respects
to the requirements of the Trust Indenture Act and the
applicable rules and regulations thereunder.
(c) The market-related and customer-related data and
estimates included in the Prospectus are based on or derived
from sources which the Company believes to be reliable and
accurate.
(d) The Company, the Parent and each of its
subsidiaries (as defined in Section 15) have been duly
incorporated and are validly existing as corporations in good
standing under the laws of their respective jurisdictions of
incorporation, are duly qualified to do business and are in
good standing as foreign corporations in each jurisdiction in
which their respective ownership or lease of property or the
conduct of their respective businesses requires such
qualification except for such qualification and good standing
the failure of which, individually or in the aggregate, would
not result in a material adverse effect on the condition
(financial or other), business, prospect, properties,
stockholders' equity or results of operations of
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the Company and its subsidiaries taken as a whole (a "Material
Adverse Effect"), and have all power and authority necessary
to own or hold their respective properties and to conduct the
businesses in which they are engaged; and none of the
subsidiaries of the Company is a "significant subsidiary," as
such term is defined in Rule 405 of the Rules and
Regulations.
(e) All of the issued shares of capital stock of the
Company have been duly and validly authorized and issued, are
fully paid and non-assessable and conform to the description
thereof contained in the Prospectus; and all of the issued
shares of capital stock of each subsidiary of the Company
have been duly and validly authorized and issued and are
fully paid and non-assessable and (except for directors'
qualifying shares) are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances, equities
or claims, other than (i) liens, encumbrances, equities or
claims described in the Prospectus and (ii) such other liens,
encumbrances, equities or claims as are not, individually or
in the aggregate, material to the Company and its
subsidiaries, taken as a whole.
(f) This Agreement has been duly authorized,
executed and delivered by the Company and the Guarantors.
(g) The Indenture has been duly authorized, and when
duly executed by the proper officers of the Company (assuming
due execution and delivery by the Trustee) and delivered by
the Company, will constitute a valid and binding agreement of
the Company enforceable against the Company in accordance
with its terms, subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium
and other similar laws relating to or affecting creditors'
rights generally, general equitable principles (whether
considered in a proceeding in equity or at law) or an implied
covenant of good faith and fair dealing.
(h) The Notes have been duly and validly authorized
by the Company and when duly executed by the Company in
accordance with the terms of the Indenture and, assuming due
authentication of the Notes by the Trustee, upon delivery to
the Underwriters against payment therefor in accordance with
the terms hereof, will constitute valid and binding
obligations of the Company entitled to the benefits of the
Indenture and enforceable in accordance with their terms,
subject to the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, general
equitable principles (whether considered in a proceeding in
equity or at law) or an implied covenant of good faith and
fair dealing; and the Notes, when issued and delivered, will
conform to the description thereof contained in the
Prospectus.
(i) The Guarantees have been duly and validly
authorized by the Guarantors and when duly endorsed on the
Notes in accordance with the terms of the Indenture and,
assuming due authentication of the Notes by the Trustee, upon
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delivery to the Underwriters against payment therefor in
accordance with the terms hereof, will constitute valid and
binding obligations of each of the Guarantors entitled to the
benefits of the Indenture and enforceable in accordance with
their terms, subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium
and other similar laws relating to or affecting creditors'
rights generally, general equitable principles (whether
considered in a proceeding in equity or at law) or an implied
covenant of good faith and fair dealing.
(j) The execution, delivery and performance of this
Agreement and the Indenture by the Company and the Guarantors
and the consummation of the transactions contemplated hereby
and thereby will not conflict with or constitute a breach of,
or a default under, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which the
Company or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries is bound or to which any
of the property or assets of the Company or any of its
subsidiaries is subject, that is material to the financial
condition or prospects of the Company and its subsidiaries,
taken as a whole (collectively, the "Material Agreements"),
except for breach of which, individually, or in the
aggregate, would not result in a Material Adverse Effect, nor
will such actions result in any violation of the provisions
of the charter or by-laws of the Company or any of its
subsidiaries or any material law, statute or any order, rule
or regulation of any court or governmental agency or body
having jurisdiction over the Company or any of its
subsidiaries or any of their properties or assets, provided,
that the provisions for indemnification and contribution
hereunder and thereunder may be limited by equitable
principles and public policy consideration; and except for
the registration of the Notes and the Guarantees under the
Securities Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under the
United States Securities Exchange Act of 1934, as amended
(the "Exchange Act") and applicable state securities laws in
connection with the purchase and distribution of the Notes
and the Guarantees by the Underwriters, no consent,
approval, authorization or order of, or filing or
registration with, any such court or governmental agency or
body is required for the execution, delivery and performance
of this Agreement, or the Indenture by the Company and the
Guarantors and the consummation of the transactions
contemplated hereby and thereby.
(k) Except as described in the Prospectus, there are
no contracts, agreements or understandings between the
Company and any person granting such person the right (other
than rights which have been waived or satisfied or rights not
exerciserable in connection with the Registration Statement)
to require the Company to file a registration statement under
the Securities Act with respect to any securities of the
Company owned or to be owned by such person or to require the
Company to include such securities in the securities
registered pursuant to the Registration Statement or in any
securities being registered pursuant to any other
registration statement filed by the Company under the
Securities Act.
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(l) Except as described in the Registration
Statement, the Company and the Guarantors have not sold or
issued any Securities with terms that are substantially
similar to the Notes and the Guarantees during the six-month
period preceding the date of the Prospectus, including any
sales pursuant to Rule 144A under, or Regulations D or S of,
the Securities Act.
(m) Neither the Company nor any of its subsidiaries
has incurred, since the date of the latest audited financial
statements included in the Prospectus, any liability or
obligation, direct or contingent, or entered into any
transaction, in each case not in the ordinary course of
business, that is material to the Company and its
subsidiaries taken as a whole, otherwise than as set forth or
contemplated in the Prospectus; and, since such date, there
has not been any material change in the capital stock or
material increase in the short-term or long-term debt of the
Company or any of its subsidiaries or any material adverse
change, or any development involving or which would
reasonably be expected to involve a Material Adverse Effect,
otherwise than as described or contemplated in the
Prospectus.
(n) The historical and pro forma financial
statements, together with related notes, set forth in the
Prospectus comply as to form in all material respects with
the requirements of Regulation S-X under the Securities Act
applicable to registration statements on Form S-1 under the
Securities Act. The historical financial statements of the
Company fairly present the financial position of the Company
(or its predecessors) at the respective dates indicated and
the results of operations and cash flows of the Company (or
its predecessors) for the respective periods indicated, in
accordance with generally accepted accounting principals
consistently applied throughout such periods. Such pro forma
financial statements have been prepared on a basis consistent
with such historical statements of the Company, except for
the pro forma adjustments specified therein, and give effect
to assumptions made on a reasonable basis and in good faith
and present fairly the historical and proposed transactions
contemplated by the Prospectus and this Agreement. The other
financial and statistical information and data included in
the Prospectus, historical and pro forma, have been derived
from the financial records of the Company (or its
predecessors) and, in all material respects, have been
prepared on a basis consistent with such books and records of
the Company (or its predecessor), except as disclosed
therein.
(o) Coopers & Xxxxxxx L.L.P., who have certified
certain financial statements of the Company, whose report
appears in the Prospectus and who have delivered the initial
letter referred to in Section 7(g) hereof, are independent
public accountants as required by the Securities Act and the
Rules and Regulations; and Ernst & Young LLP and KPMG Peat
Marwick LLP, whose reports appear in the Prospectus and who
have delivered the initial letters referred to in Sections
7(h) and 7(i) hereof, are independent accountants as required
by the Securities Act and the Rules and Regulations.
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(p) The Company and each of its subsidiaries have
good and marketable title to all property (real and personal)
described in the Prospectus as being owned by them, free and
clear of all liens, claims, security interests or other
encumbrances except such as are described in the Prospectus
or, to the extent that any such liens, claims, security
interests or other encumbrances would not have a Material
Adverse Effect (individually or in the aggregate) and all the
material property described in the Prospectus as being held
under lease by the Company and its subsidiaries is held by
them under valid, subsisting and enforceable leases, with
only such exceptions as would not have a Material Adverse
Effect (individually or in the aggregate).
(q) The Company and each of its subsidiaries own or
possess adequate rights to use all material patents,
trademarks, service marks, trade names, copyrights, licenses,
inventions, trade secrets and other rights, and all
registrations or applications relating thereto, described in
the Prospectus as being owned by them or necessary for the
conduct of their business, except as such would not have a
Material Adverse Effect (individually or in the aggregate),
and the Company is not aware of any pending or threatened
claim to the contrary or any pending or threatened challenge
by any other person to the rights of the Company and its
subsidiaries with respect to the foregoing which, if
determined adversely to the Company and its subsidiaries,
would have a Material Adverse Effect (individually or in the
aggregate).
(r) Except as described in the Prospectus, there are
no legal or governmental proceedings pending or, to the
knowledge of the Company, threatened, against the Company or
any of its subsidiaries or to which the Company or any of its
subsidiaries is a party or of which any property or assets of
the Company or any of its subsidiaries is the subject which,
if determined adversely to the Company or any of its
subsidiaries, are reasonably likely to cause a Material
Adverse Effect.
(s) There are no contracts or other documents which
are required to be described in the Prospectus or filed as
exhibits to the Registration Statement by the Securities Act
or by the Rules and Regulations which have not been described
in the Prospectus or filed as exhibits to the Registration
Statement or incorporated therein by reference as permitted
by the Rules and Regulations.
(t) No material relationship, direct or indirect,
exists between or among the Company on the one hand, and the
directors, officers, stockholders, customers or suppliers of
the Company on the other hand, except as described in the
Prospectus.
(u) The Company is not involved in any strike, job
action or labor dispute with any group of employees that
would have a Material Adverse Effect, and, to the Company's
knowledge, no such action or dispute is threatened.
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(v) Except as disclosed in the Prospectus, 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 material
liability; the Company has not incurred and does not expect
to incur any material liability under (i) Title IV of ERISA
with respect to 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") (other
than contributions in the normal course which are not in
default); 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 reasonably be expected to cause
the loss of such qualification.
(w) The Company and its subsidiaries have filed all
federal, state and local income and franchise tax returns
required to be filed through the date hereof and have paid
all taxes due thereon, and no tax deficiency has been
determined adversely to the Company or any of its
subsidiaries nor does the Company have any knowledge of any
tax deficiency which, if determined adversely to the Company
and its subsidiaries, might have a Material Adverse Effect.
(x) Neither the Company nor any of its subsidiaries
(i) is in violation of its charter or by-laws, (ii) is in
default in any material respect, and no event has occurred
which, with notice or lapse of time or both, would constitute
such a default, in the due performance or observance of any
term, covenant or condition contained in any Material
Agreement or (iii) is in violation in any material respect of
any law, ordinance, governmental rule, regulation or court
decree to which it or its property or assets may be subject
or has failed to obtain any material license, permit,
certificate, franchise or other governmental authorization or
permit necessary to the ownership of its property or to the
conduct of its business, except as would not, individually or
in the aggregate, have a Material Adverse Effect.
(y) To the best of the Company's knowledge, neither
the Company nor any of its subsidiaries, nor any director,
officer, agent, employee or other person associated with or
acting on behalf of the Company or any of its subsidiaries,
has used any corporate funds for any unlawful contribution,
gift, entertainment or other unlawful expense relating to
political activity; made any direct or indirect unlawful
payment to any foreign or domestic government official or
employee from corporate funds or violated or is in violation
of any provision of the Foreign Corrupt Practices Act of
1977; except as such that would not have a Material Adverse
Effect.
(z) There has been no storage, disposal, generation,
manufacture, refinement, transportation, handling or
treatment of toxic wastes, medical wastes,
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hazardous wastes or hazardous substances by the Company or
any of its subsidiaries (or, to the knowledge of the Company,
any of their predecessors in interest) at, upon or from any of
the property now or previously owned or leased by the Company
or its subsidiaries in violation of any applicable law,
ordinance, rule, regulation, order, judgment, decree or
permit or which would require remedial action under any
applicable law, ordinance, rule, regulation, order, judgment,
decree or permit, except for any violation or remedial action
which would not have, or would not be reasonably likely to
have, singularly or in the aggregate with all such violations
and remedial actions, a Material Adverse Effect; there has
been no material spill, discharge, leak, emission, injection,
escape, dumping or release of any kind onto such property or
into the environment surrounding such property of any toxic
wastes, medical wastes, solid wastes, hazardous wastes or
hazardous substances due to or caused by the Company or any
of its subsidiaries or with respect to which the Company has
knowledge, except for any such spill, discharge, leak,
emission, injection, escape, dumping or release which would
not have or would not be reasonably likely to have,
singularly or in the aggregate with all such spills,
discharges, leaks, emissions, injections, escapes, dumpings
and releases, a Material Adverse Effect; and the terms
"hazardous wastes," "toxic wastes," "hazardous substances"
and "medical wastes" shall have the meanings specified in any
applicable local, state, federal and foreign laws or
regulations with respect to environmental protection.
(aa) Neither the Company nor any subsidiary is an
"investment company" within the meaning of such term under
the United States Investment Company Act of 1940 and the
rules and regulations of the Commission thereunder.
(ab) All of the representations and warranties of
the parties to the International Underwriting Agreement and
the U.S. Underwriting Agreement, are true and correct.
2. Purchase of the Notes and Guarantees by the Underwriters.
On the basis of the representations and warranties contained in, and subject to
the terms and conditions of, this Agreement, the Company agrees to sell the
Notes (and cause the Guarantors to issue the Guarantees) to the several
Underwriters and each of the Underwriters, severally and not jointly, agrees to
purchase the aggregate principal amount of Notes set opposite that
Underwriter's name in Schedule 1 hereto. Each Underwriter will purchase such
aggregate principal amount of Notes at an aggregate purchase price equal to
___% of the principal amount thereof (the "Purchase Price").
The Company shall not be obligated to deliver any of the
Notes and Guarantees to be delivered on the Delivery Date (as hereinafter
defined), except upon payment for all the Notes and Guarantees to be purchased
on the Delivery Date as provided herein.
3. Offering of Notes and Guarantees by the Underwriters. Upon
authorization by the Underwriters of the release of the Notes and Guarantees,
the several Underwriters propose to offer the Notes and Guarantees for sale
upon the terms and conditions set forth in the Prospectus.
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4. Delivery of and Payment for the Notes and Guarantees.
Delivery of and payment for the Notes and Guarantees shall be made at the
office of Xxxxxx & Xxxxxxx, 000 Xxxxx Xxxxxx Xxx Xxxx, Xxx Xxxx 00000 at 10:00
A.M., New York City time, on the third full business day following the date of
this Agreement or at such other date or place as shall be determined by
agreement between the Underwriters and the Company. This date and time are
sometimes referred to as the "Delivery Date." On the Delivery Date, the Company
shall deliver or cause to be delivered certificates representing the Notes and
Guarantees to the Underwriters for the account of each Underwriter against
payment to or upon the order of the Company of the purchase price by wire
transfer in immediately available funds. Time shall be of the essence, and
delivery at the time and place specified pursuant to this Agreement is a
further condition of the obligation of each Underwriter hereunder. Upon
delivery, the Notes and Guarantees shall be registered in such names and in
such denominations as the Underwriters shall request in writing not less than
two full business days prior to the Delivery Date. For the purpose of
expediting the checking and packaging of the certificates for the Notes and
Guarantees, the Company shall make the certificates representing the Notes and
Guarantees available for inspection by the Underwriters in New York, New York,
not later than 2:00 P.M., New York City time, on the business day prior to the
Delivery Date.
5. Further Agreements of the Company. The Company agrees:
(a) To prepare the Prospectus in a form approved by
the Underwriters and to file such Prospectus pursuant to Rule
424(b) under the Securities Act not later than Commission's
close of business on the second business day following the
execution and delivery of this Agreement or, if applicable,
such earlier time as may be required by Rule 430A(a)(3) under
the Securities Act; to make no further amendment or any
supplement to the Registration Statement or to the Prospectus
except as permitted herein; to advise the Underwriters,
promptly (i) after it receives notice thereof, of the time
when any amendment to the Registration Statement has been
filed or becomes effective or any supplement to the
Prospectus or any amended Prospectus has been filed and (ii)
if the Company is required to file a Rule 462(b) Registration
Statement after the effectiveness of this Agreement, when the
Rule 462(b) Registration Statement has become effective and,
in the case of each of (i) and (ii), to furnish the
Underwriters with copies thereof; to advise the Underwriters,
promptly after it receives notice thereof, of the issuance by
the Commission of any stop order or of any order preventing
or suspending the use of any Preliminary Prospectus or the
Prospectus, of the suspension of the qualification of the
Notes and Guarantees for offering or sale in any
jurisdiction, of the initiation or threatening of any
proceeding for any such purpose, or of any request by the
Commission for the amending or supplementing of the
Registration Statement or the Prospectus or for additional
information; and, in the event of the issuance of any stop
order or of any order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus or suspending any
such qualification, to use promptly its reasonable best
efforts to obtain its withdrawal;
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(b) To furnish promptly to each of the Underwriters
and to counsel for the Underwriters a conformed copy of the
Registration Statement as originally filed with the
Commission, and each amendment thereto filed with the
Commission, including all consents and exhibits filed
therewith;
(c) To deliver promptly to the Underwriters such
number of the following documents as the Underwriters shall
reasonably request each Preliminary Prospectus, the
Prospectus and any amended or supplemented Prospectus; and,
if the delivery of a prospectus is required at any time after
the Effective Time in connection with the offering or sale of
the Notes or any other securities relating thereto and if at
such time any events shall have occurred as a result of which
the Prospectus as then amended or supplemented would include
an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements
therein, in the light of the circumstances under which they
were made when such Prospectus is delivered, not misleading,
or, if for any other reason it shall be necessary to amend or
supplement the Prospectus in order to comply with the
Securities Act, to notify the Underwriters and, upon their
request, to file such document and to prepare and furnish
(without charge for the 9 month period following the Delivery
Date) to each Underwriter and to any dealer in securities as
many copies as the Underwriters may from time to time
reasonably request of an amended or supplemented Prospectus
which will correct such statement or omission or effect such
compliance.
(d) To file promptly with the Commission any
amendment to the Registration Statement or the Prospectus or
any supplement to the Prospectus that may, in the judgment of
the Company or the Underwriters, be required by the
Securities Act or requested by the Commission;
(e) Prior to filing with the Commission any
amendment to the Registration Statement or supplement to the
Prospectus or any Prospectus pursuant to Rule 424 of the
Rules and Regulations, to furnish a copy thereof to the
Underwriters and counsel for the Underwriters and not to file
any such document to which the Underwriters shall reasonably
object after having been given reasonable notice of the
proposed filing thereof;
(f) As soon as practicable after the Effective Date,
(it being understood that the Company shall have until at
least 410 days after the end of the Company's current fiscal
quarter) to make generally available to the Company's
security holders and to deliver to the Underwriters an
earnings statement of the Company and its subsidiaries (which
need not be audited) complying with Section 11(a) of the
Securities Act and the Rules and Regulations (including, at
the option of the Company, Rule 158);
(g) Promptly from time to time to take such action
as the Underwriters may reasonably request to qualify the
Notes and the Guarantees for offering and sale
11
under the securities laws of such jurisdictions as the
Underwriters may request (provided, however, that the Company
shall not be obligated to qualify as a foreign corporation in
any jurisdiction in which it is not now so qualified or to
take any action that would subject it to general consent to
service of process in any jurisdiction in which it is not now
so subject) and to comply with such laws so as to permit the
continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the
distribution of the Stock;
(h) To apply the net proceeds from the sale of the
Notes being sold by the Company as set forth in the
Prospectus;
(i) To take such steps as shall be necessary to
ensure that neither the Company nor any subsidiary shall
become an "investment company" within the meaning of such
term under the United States Investment Company Act of 1940
and the rules and regulations of the Commission thereunder;
and
(j) If the Registration Statement at the time of the
effectiveness of this Agreement does not cover all of the
Notes and Guarantees, to file (and cause the Guarantors to
file) a Rule 462(b) Registration Statement with the
Commission registering the Notes and Guarantees not so
covered in compliance with Rule 462(b) by 10:00 P.M., New
York City time, on the date of this Agreement and to pay to
the Commission the filing fee for such Rule 462(b)
Registration Statement at the time of the filing thereof or
to give irrevocable instructions for the payment of such fee
pursuant to Rule 111(b) under the Securities Act.
6. Expenses. The Company agrees to pay (a) the costs incident
to the authorization, issuance, sale and delivery of the Notes and Guarantees
and any taxes payable in that connection; (b) the costs incident to the
preparation, printing and filing under the Securities Act of the Registration
Statement and any amendments and exhibits thereto; (c) the costs of
distributing the Registration Statement as originally filed and each amendment
thereto and any post-effective amendments thereof (including, in each case,
exhibits), any Preliminary Prospectus, the Prospectus and any amendment or
supplement to the Prospectus, all as provided in this Agreement; (d) the filing
fees incident to securing any required review by the National Association of
Securities Dealers, Inc. of the terms of sale of the Notes and Guarantees; (e)
any applicable listing or other fees; (f) the fees and expenses of qualifying
the Notes and Guarantees under the securities laws of the several jurisdictions
as provided in Section 5(h) and of preparing, printing and distributing a Blue
Sky Memorandum (including related fees and expenses of counsel to the
Underwriters); (g) any fees charged by securities rating services for rating
the Notes and Guarantees; (h) all costs and expenses incident to the
performance of the Company's obligations under Section 9 and (i) all other
costs and expenses incident to the performance of the obligations of the
Company and the Guarantors; provided, that (x) the Company and the Underwriters
will bear their own "road show" expenses and (y) the Company on the one hand,
and the Underwriters on the other hand, will each bear one half of the cost of
the charter air craft used in connection with the "road show."
12
7. Conditions of Underwriters' Obligations. The respective
obligations of the Underwriters hereunder are subject to the accuracy, when
made and on the Delivery Date, of the representations and warranties of the
Company contained herein, to the performance by the Company of its obligations
hereunder, and to each of the following additional terms and conditions:
(a) The Prospectus shall have been timely filed with
the Commission in accordance with Section 5(a); no stop order
suspending the effectiveness of the Registration Statement or
any part thereof shall have been issued and no proceeding for
that purpose shall have been initiated or threatened by the
Commission; any request of the Commission for inclusion of
additional information in the Registration Statement or the
Prospectus or otherwise shall have been complied with; and
any 462(b) Registration Statement required by this Agreement
to be filed shall have been so filed and become effective.
(b) No Underwriter shall have discovered and
disclosed to the Company on or prior to the Delivery Date
that the Registration Statement or the Prospectus or any
amendment or supplement thereto contains an untrue statement
of a fact which, in the opinion of Xxxxxx & Xxxxxxx, counsel
for the Underwriters, is material or omits to state a fact
which, in the opinion of such counsel, is material and is
required to be stated therein or is necessary to make the
statements therein not misleading.
(c) All corporate proceedings and other legal
matters incident to the authorization, form and validity of
this Agreement, the Indenture, the Notes, the Registration
Statement and the Prospectus, and all other legal matters
relating to this Agreement and the transactions contemplated
hereby shall be reasonably satisfactory in all material
respects to counsel for the Underwriters, and the Company
shall have furnished to such counsel all documents and
information that they may reasonably request to enable them
to pass upon such matters.
(d) Xxxxxxx Xxxxxxx & Xxxxxxxx shall have furnished
to the Underwriters its written opinion, as counsel to the
Company, addressed to the Underwriters and dated the Delivery
Date, in form and substance reasonably satisfactory to the
Underwriters, to the effect that:
(i) The Company and each of its Delaware
subsidiaries have been duly incorporated and are
validly existing as corporations and in good
standing under the laws of Delaware, and have all
corporate power and authority necessary to conduct
their respective businesses as described in the
Registration Statement and the Prospectus;
(ii) The Parent has an authorized
capitalization as set forth in the Prospectus, and
all of the issued shares of capital stock of the
Company (including the shares of Stock and
International Stock being delivered on the Delivery
Date) have been duly and validly authorized and
issued, are fully paid and non-assessable and
conform to the description thereof contained in
13
the Prospectus; and all of the issued shares of
capital stock of each Delaware subsidiary of the
Company have been duly and validly authorized and
issued, are fully paid and non-assessable (except for
directors' qualifying shares) and, based solely on
our examination of each such subsidiary's stock
ledger and minute book, all such shares are held of
record by the Company and/or a subsidiary of the
Company;
(iii) The Registration Statement has become
effective under the Securities Act, the Indenture
was qualified under the Trust Indenture Act and the
Prospectus was filed pursuant to Rule 424(b)__ of
the rules and regulations of the Commission under
the Act and, to our knowledge, no stop order
suspending the effectiveness of the Registration
Statement has been issued or proceeding for that
purpose has been instituted or threatened by the
Commission;
(iv) The Indenture has been duly
authorized, executed and delivered by the Company
and duly qualified under the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act") and
assuming due authorization, execution and delivery
thereof by the Trustee, constitutes a valid and,
legally binding obligation of the Company
enforceable against the Company in accordance with
its terms, subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or
affecting creditors' rights generally, general
equitable principles (whether considered in a
proceeding in equity or at law) or an implied
covenant of good faith and fair dealing.
(v) The Notes have been duly authorized,
executed and issued by the Company and, assuming due
authentication thereof by the Trustee and upon
payment and delivery in accordance with the terms of
the Underwriting Agreement, will constitute valid
and legally binding obligations of the Company
enforceable against the Company in accordance with
their terms and entitled to the benefits of the
Indenture subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or
affecting creditors' rights generally, general
equitable principles (whether considered in a
proceeding in equity or at law) or an implied
covenant of good faith and fair dealing; and the
Notes, when issued and delivered, will conform to
the description thereof contained in the Prospectus.
(vi) The Guarantees have been duly
authorized, executed and issued by the respective
Guarantors and, assuming due authentication of the
Notes by the Trustee, upon payment and delivery in
accordance with the terms of the Underwriting
Agreement will constitute valid and legally binding
obligations of each of the Guarantors enforceable in
accordance with their terms, subject to the effects
of bankruptcy, insolvency, fraudulent
14
conveyance, reorganization, moratorium and other
similar laws relating to or affecting creditors'
rights generally, general equitable principles
(whether considered in a proceeding in equity or at
law) or an implied covenant of good faith and fair
dealing.
(vii) The statements contained in the
Prospectus under the captions "Risk
Factors-Subordination," "Risk Factors-Restrictions
Imposed by the Senior Credit Facilities and the
Indentures," "Business-Pension Plans," "Certain
Relationships and Related Transactions,"
"Management-Limitations on Liability and
Indemnification Matters," "Management-1997 Stock
Option Plan," "Management-Employment Agreements,"
"Description of Certain Indebtedness," and
"Description of the Notes," insofar as they describe
charter documents, contracts, statutes, rules and
regulations and other legal matters, constitute an
accurate summary thereof in all material respects;
(viii) The statements made in the
Prospectus under the caption "United States Federal
Tax Considerations," insofar as they purport to
constitute summaries of matters of United States
federal tax law and regulations or legal conclusions
with respect thereto, constitute accurate summaries
of the matters described therein in all material
respects.
(ix) To such counsel's knowledge, there are
no contracts or documents of a character required by
the Securities Act or by the rules and regulations
thereunder to be described in the Registration
Statement or the Prospectus or to be filed as
exhibits to the Registration Statement which are not
described or filed as required by the Securities Act
or by the rules and regulations thereunder;
(x) This Agreement has been duly
authorized, executed and delivered by the Company
and the Guarantors;
(xi) The issue and sale of the Notes and
Guarantees being delivered on the Delivery Date by
the Company and the Guarantors and the compliance by
the Company, the Guarantors or the Parent, as
applicable, with all of the provisions of this
Agreement, the Indenture, the International
Underwriting Agreement and the U.S. Underwriting
Agreement and the consummation of the transactions
contemplated hereby and thereby will not breach or
result in a default under, any indenture, mortgage,
deed of trust, loan agreement or other agreement or
instrument filed as an exhibit to the Registration
Statement nor will such actions violate the
Certificate of Incorporation or By-Laws of the
Company, the Parent or any of their subsidiaries or
any federal or New York statute or the Delaware
General Corporation Law or any rule or regulation
that has been issued pursuant to any federal or New
York statute or the Delaware General Corporation Law
15
or any order known to such counsel issued pursuant
to any federal or New York statute or the Delaware
General Corporation Law by any court or governmental
agency or body or court having jurisdiction over the
Company, the Parent or any of their subsidiaries or
any of their properties or assets; and no consent,
approval, authorization, order, registration or
qualification of or with any federal or New York
governmental agency or body or any Delaware
governmental agency or body acting pursuant to the
Delaware General Corporation Law or, to such
counsel's knowledge, any federal or New York court
or any Delaware court acting pursuant to the
Delaware General Corporation Law is required for the
issue and sale of the Stock and International Stock
by the Parent and the issuance and sale of the Notes
by the Company (and the guarantee of such Notes by
the Guarantors), except for the registration under
the Act and the Exchange Act of the Stock,
International Stock, Notes and Guarantees, and such
consents, approvals, authorizations, registrations
or qualifications as may be required state
securities or Blue Sky laws in connection with the
purchase and distribution of the Stock by the U.S.
Underwriters and the International Managers and the
Notes and Guarantees by the Underwriters. The
opinions set forth in this paragraph are based upon
our consideration of only those statutes, rules and
regulations which, in such counsel's experience, are
normally applicable to securities underwriting
transactions.
In rendering such opinion, such counsel may
state that its opinion is limited to matters
governed by the federal laws of the United States
and the laws of the State of New York and the
Delaware General Corporation Law.
Such counsel shall also have furnished to the
Underwriters a written statement, addressed to the
Underwriters and dated the Delivery Date. Such
counsel has not independently verified the accuracy,
completeness or fairness of the statements made or
included in the Registration Statement or the
Prospectus and take no responsibility therefor,
except as and to the extent set forth in paragraph
(viii) above. In the course of the preparation by
the Company of the Registration Statement and the
Prospectus, such counsel participated in conferences
with certain officers and employees of the Company,
with representatives of Coopers & Xxxxxxx L.L.P.,
Ernst & Young LLP, KPMG Peat Marwick LLP and with
counsel to the Company. Based upon our examination
of the Registration Statement and the Prospectus,
our investigations made in connection with the
preparation of the Registration Statement and the
Prospectus and our participation in the conferences
referred to above, (i) such counsel is of the
opinion that the Registration Statement, as of its
effective date, and the Prospectus, as of _______,
1998, complied as to form in all material respects
with the requirements of the Act and the applicable
rules and regulations of the Commission thereunder,
except that in each case such counsel need not
express opinion with respect to the financial
statements or other financial
16
data contained or incorporated by reference in the
Registration Statement or the Prospectus, and (ii)
such counsel has no reason to believe that the
Registration Statement, as of its effective date,
contained any untrue statement of a material fact or
omitted to state any material fact required to be
stated therein or necessary in order to make the
statements therein not misleading or that the
Prospectus contains any untrue statement of a
material fact or omits to state any material fact
necessary in order to make the statements therein, in
the light of the circumstances under which they were
made, not misleading, except that in each case such
counsel need not express belief with respect to the
financial statements or other financial data
contained in the Registration Statement or the
Prospectus.
(e) Xxxxxxxxxxx X. Xxxxxxx, General Counsel
of the Company, shall have furnished to the Underwriters his
written opinion, as General Counsel to the Company, addressed
to the Underwriters and dated the Delivery Date, in form and
substance reasonably satisfactory to the Underwriters, to the
effect that:
(i) To such counsel's knowledge, the
Company and each of its subsidiaries have good and
marketable title to all property (real and personal)
described in the Prospectus as being owned by them,
free and clear of all liens, claims, security
interests or other encumbrances except such as are
described in the Prospectus or, to the extent that
any such liens, claims, security interests or other
encumbrances would not have a Material Adverse
Effect (individually or in the aggregate) and all
the material property described in the Prospectus as
being held under lease by the Company and its
subsidiaries is held by them under valid, subsisting
and enforceable leases, with only such exceptions as
would not have a Material Adverse Effect
(individually or in the aggregate);
(ii) To such counsel's knowledge and except
as otherwise disclosed in the Prospectus, there are
no legal or governmental proceedings pending or
threatened, against the Company or any of its
subsidiaries or to which the Company or any of its
subsidiaries is a party or of which any property or
assets of the Company or any of its subsidiaries is
the subject which, if determined adversely to the
Company or any of its subsidiaries, are reasonably
likely to cause a Material Adverse Effect;
(iii) To such counsel's knowledge and
except as otherwise disclosed in the Prospectus,
there are no contracts, agreements or understandings
between the Company and any person granting such
person the right to require the Company to include
such person's securities in the securities
registered pursuant to the Registration Statement;
(iv) None of the issue and sale of the
Notes and Guarantees being delivered on such
Delivery Date by the Company and the Guarantors and
17
the compliance by the Company, the Guarantors and
the Parent, as applicable, with all of the
provisions of this Agreement, the International
Underwriting Agreement and the U.S. Underwriting
Agreement and the consummation of the transactions
contemplated hereby and thereby requires any
consent, approval, authorization or other order of,
or registration or filing with, any federal court,
federal regulatory body, federal administrative
agency or other federal governmental official having
authority over government procurement matters
(provides), that the opinion contained in this
paragraph (iv) may be delivered by other counsel
reasonably satisfactory to the Underwriters).
(f) The Underwriters shall have received from Xxxxxx
& Xxxxxxx, counsel for the Underwriters, such opinion or
opinions, dated the Delivery Date, with respect to the
issuance and sale of the Notes and Guarantees, the
Registration Statement, the Prospectus and other related
matters as the Underwriters may reasonably require, and the
Company shall have furnished to such counsel such documents
as they reasonably request for the purpose of enabling them
to pass upon such matters.
(g) At the time of execution of this Agreement, the
Underwriters shall have received from Coopers & Xxxxxxx
L.L.P. a letter, in form and substance satisfactory to the
Underwriters, addressed to the Underwriters and dated the
date hereof (i) confirming that they are independent public
accountants within the meaning of the Securities Act and are
in compliance with the applicable requirements relating to
the qualification of accountants under Rule 2-01 of
Regulation S-X of the Commission and (ii) stating, as of the
date hereof (or, with respect to matters involving changes or
developments since the respective dates as of which specified
financial information is given in the Prospectus, as of a
date not more than five days prior to the date hereof), the
conclusions and findings of such firm with respect to the
financial information and other matters ordinarily covered by
accountants' "comfort letters" to underwriters in connection
with registered public offerings.
(h) At the time of execution of this Agreement, the
Underwriters shall have received from Ernst & Young LLP a
letter, in form and substance satisfactory to the
Underwriters, addressed to the Underwriters and dated the
date hereof (i) confirming that they are independent public
accountants within the meaning of the Securities Act and are
in compliance with the applicable requirements relating to
the qualification of accountants under Rule 2-01 of
Regulation S-X of the Commission and (ii) stating, as of the
date hereof (or, with respect to matters involving changes or
developments since the respective dates as of which specified
financial information is given in the Prospectus, as of a
date not more than five days prior to the date hereof), the
conclusions and findings of such firm with respect to the
financial information and other matters ordinarily covered by
accountants' "comfort letters" to underwriters in connection
with registered public offerings.
18
(i) At the time of execution of this Agreement, the
Underwriters shall have received from KPMG Peat Marwick LLP a
letter, in form and substance satisfactory to the
Underwriters, addressed to the Underwriters and dated the
date hereof (i) confirming that they are independent public
accountants within the meaning of the Securities Act and are
in compliance with the applicable requirements relating to
the qualification of accountants under Rule 2-01 of
Regulation S-X of the Commission and (ii) stating, as of the
date hereof (or, with respect to matters involving changes or
developments since the respective dates as of which specified
financial information is given in the Prospectus, as of a
date not more than five days prior to the date hereof), the
conclusions and findings of such firm with respect to the
financial information and other matters ordinarily covered by
accountants' "comfort letters" to underwriters in connection
with registered public offerings.
(j) With respect to the letters referred to in the
preceding three paragraphs and delivered to the Underwriters
concurrently with the execution of this Agreement (the
"initial letters"), the Company shall have furnished to the
Underwriters letters (the "bring-down letters") of such
accountants, in form and substance satisfactory to the
Underwriters, addressed to the Underwriters and dated the
Delivery Date (i) confirming that they are independent public
accountants within the meaning of the Securities Act and are
in compliance with the applicable requirements relating to
the qualification of accountants under Rule 2-01 of
Regulation S-X of the Commission, (ii) stating, as of the
date of the bring-down letters (or, with respect to matters
involving changes or developments since the respective dates
as of which specified financial information is given in the
Prospectus, as of a date not more than five days prior to the
date of the bring-down letter), the conclusions and findings
of such firms with respect to the financial information and
other matters covered by the initial letters and (iii)
confirming in all material respects the conclusions and
findings set forth in the initial letters.
(k) The Company and the Guarantors shall have
furnished to the Underwriters a certificate, dated the
Delivery Date, of their respective Chairman of the Board,
their respective President or a Vice President and their
respective chief financial officer stating that:
(i) The representations and warranties of
the Company and the Guarantors in Section 1 are true
and correct as of the Delivery Date; the Company and
the Guarantors have complied with all their
agreements contained herein; and the conditions set
forth in Sections 7(a) and 7(l) have been fulfilled;
and
(ii) They have carefully examined the
Registration Statement and the Prospectus and, in
their opinion (A) as of the Effective Date, the
Registration Statement and Prospectus did not
include any untrue statement of a material fact and
did not omit to state a material fact required to be
stated therein or necessary to make the statements
therein not misleading,
19
and (B) since the Effective Date no event has
occurred which should have been set forth in a
supplement or amendment to the Registration
Statement or the Prospectus.
(l) (i) Neither the Company nor any of its
subsidiaries shall have sustained since the date of the
latest audited financial statements included in the
Prospectus any material loss or interference with its
business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the Prospectus
or (ii) since such date there shall not have been any change
in the capital stock or long-term debt of the Company or any
of its subsidiaries or any change, or any development
involving a prospective change, in or affecting the business,
management, financial position, stockholders' equity or
results of operations of the Company and its subsidiaries
taken as a whole, otherwise than as set forth or contemplated
in the Prospectus, the effect of which, in any such case
described in clause (i) or (ii), is, in the judgment of the
Underwriters, so material and adverse as to make it
impracticable or inadvisable to proceed with the public
offering or the delivery of the Notes and the Guarantees
being delivered on the Delivery Date on the terms and in the
manner contemplated in the Prospectus.
(m) Subsequent to the execution and delivery of this
Agreement (i) no downgrading shall have occurred in the
rating accorded the Company's debt securities by any
"nationally recognized statistical rating organization," as
that term is defined by the Commission for purposes of Rule
436(g)(2) of the Rules and Regulations and (ii) no such
organization shall have publicly announced that it has under
surveillance or review, with possible negative implications,
its rating of any of the Company's debt securities.
(n) Subsequent to the execution and delivery of this
Agreement there shall not have occurred any of the following:
(i) trading in securities generally on the New York Stock
Exchange or the American Stock Exchange or in the
over-the-counter market, or trading in any securities of the
Company on any exchange or in the over-the-counter market,
shall have been suspended or minimum prices shall have been
established on any such exchange or such market by the
Commission, by such exchange or by any other regulatory body
or governmental authority having jurisdiction, (ii) a banking
moratorium shall have been declared by Federal or state
authorities, (iii) the United States shall have become
engaged in hostilities, there shall have been an escalation
in hostilities involving the United States or there shall
have been a declaration of a national emergency or war by the
United States or (iv) there shall have occurred such a
material adverse change in general economic, political or
financial conditions (or the effect of international
conditions on the financial markets in the United States
shall be such) as to make it, in the judgment of a majority
in interest of the several Underwriters, impracticable or
inadvisable to proceed with the public offering or delivery
of the Stock being delivered on the
20
Delivery Date on the terms and in the manner contemplated in
the Prospectus.
(o) The closings under the U.S. Underwriting
Agreement and the International Underwriting Agreement shall
have occurred prior to the closing hereunder on the Delivery
Date.
All opinions, letters, evidence and certificates mentioned
above or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance reasonably
satisfactory to counsel for the Underwriters.
8. Indemnification and Contribution.
(a) The Company and the Guarantors shall jointly and
severally indemnify and hold harmless each Underwriter and X.X. Xxxxxxxxx,
Towbin in its role as qualified independent underwriter pursuant to the rules
of the National Association of Securities Dealers, Inc., their officers and
employees and each person, if any, who controls any Underwriter within the
meaning of the Securities Act, from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof (including, but
not limited to, any loss, claim, damage, liability or action relating to
purchases and sales of Notes and Guarantees), to which that Underwriter,
officer, employee or controlling person may become subject, under the
Securities Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, (i) any untrue statement or alleged
untrue statement of a material fact contained in any Preliminary Prospectus,
the Registration Statement or the Prospectus or in any amendment or supplement
thereto, (ii) the omission or alleged omission to state in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or in any amendment
or supplement thereto, or in any Blue Sky Application any material fact
required to be stated therein or necessary to make the statements therein not
misleading or (iii) any act or failure to act or any alleged act or failure to
act by any Underwriter in connection with, or relating in any manner to, the
Notes and Guarantees or the offering contemplated hereby, and which is included
as part of or referred to in any loss, claim, damage, liability or action
arising out of or based upon matters covered by clause (i) or (ii) above
(provided that the Company and the Guarantors shall not be liable under this
clause (iii) to the extent that it is determined in a final judgment by a court
of competent jurisdiction that such loss, claim, damage, liability or action
resulted directly from any such acts or failures to act undertaken or omitted
to be taken by such Underwriter through its gross negligence or willful
misconduct), and shall reimburse each Underwriter and each such officer,
employee or controlling person promptly upon demand for any legal or other
expenses reasonably incurred by that Underwriter, officer, employee or
controlling person in connection with investigating or defending or preparing
to defend against any such loss, claim, damage, liability or action as such
expenses are incurred; provided, however, that the Company and the Guarantors
shall not be liable in any such case to the extent that any such loss, claim,
damage, liability or action arises out of, or is based upon, any untrue
statement or alleged untrue statement or omission or alleged omission made in
any Preliminary Prospectus, the Registration Statement or the Prospectus, or in
any such amendment or supplement, in reliance upon and in conformity with
written information concerning such Underwriter furnished to the Company behalf
of any Underwriter specifically for inclusion therein; provided further, that
the indemnification contained in this paragraph (a) with respect to the
Preliminary Prospectus shall not
21
inure to the benefit of any Underwriter (or to the benefit of any officers or
employees of any Underwriter or of any person controlling such Underwriter) on
account of any such loss, claim, damage, liability or action arising from the
sale of Notes and Guarantees by such Underwriter to any person if the untrue
statement or alleged untrue statement or omission or alleged omission of a
material fact contained in the Preliminary Prospectus was corrected in the
Prospectus and the Underwriter sold Notes and Guarantees to that person without
sending or giving at or prior to the written confirmation of such sale, a copy
of the Prospectus (as then amended or supplemented) if the Company has
previously furnished sufficient copies thereof to the Underwriter on a timely
basis to permit such sending or giving which information consists solely of the
information specified in Section 8(e). The foregoing indemnity agreement is in
addition to any liability which the Company and Guarantors may otherwise have
to any Underwriter or to any officer, employee or controlling person of that
Underwriter.
(b) Each Underwriter, severally and not jointly, shall
indemnify and hold harmless the Company, the Guarantors, their officers and
employees, each of their directors, and each person, if any, who controls the
Company and the Guarantors within the meaning of the Securities Act, from and
against any loss, claim, damage or liability, joint or several, or any action
in respect thereof, to which the Company, the Guarantors or any such director,
officer or controlling person may become subject, under the Securities Act or
otherwise, insofar as such loss, claim, damage, liability or action arises out
of, or is based upon, (i) any untrue statement or alleged untrue statement of a
material fact contained (A) in any Preliminary Prospectus, the Registration
Statement or the Prospectus or in any amendment or supplement thereto, or (B)
in any Blue Sky Application or (ii) the omission or alleged omission to state
in any Preliminary Prospectus, the Registration Statement or the Prospectus, or
in any amendment or supplement thereto, or in any Blue Sky Application any
material fact required to be stated therein or necessary to make the statements
therein not misleading, but in each case only to the extent that the untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with written information concerning such
Underwriter furnished to the Company by or on behalf of that Underwriter
specifically for inclusion therein, and shall reimburse the Company and any
such director, officer or controlling person for any legal or other expenses
reasonably incurred by the Company or any such director, officer or controlling
person in connection with investigating or defending or preparing to defend
against any such loss, claim, damage, liability or action as such expenses are
incurred. The foregoing indemnity agreement is in addition to any liability
which any Underwriter may otherwise have to the Company, the Guarantors or any
such director, officer, employee or controlling person.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against
the indemnifying party under this Section 8, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however,
that the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 8 except to the extent it has
been materially prejudiced by such failure and, provided further, that the
failure to notify the indemnifying party shall not relieve it from any
liability which it may have to an indemnified party otherwise than under this
Section 8. If any such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying
22
party thereof, the indemnifying party shall be entitled to participate therein
and, to the extent that it wishes, jointly with any other similarly notified
indemnifying party, to assume the defense thereof with counsel reasonably
satisfactory to the indemnified party. After notice from the indemnifying party
to the indemnified party of its election to assume the defense of such claim or
action, the indemnifying party shall not be liable to the indemnified party
under this Section 8 for any legal or other expenses subsequently incurred by
the indemnified party in connection with the defense thereof other than
reasonable costs of investigation; provided, however, any indemnified party
shall have the right to employ separate counsel in any such action and to
participate in the defense thereof but the fees and expenses of such counsel
shall be at the expense of the indemnified party unless (i) the employment
thereof has been specifically authorized by the indemnifying party in writing,
(ii) such indemnified party shall have been advised by such counsel that there
may be one or more legal defenses available to it which are different from or
additional to those available to the indemnifying party and in the reasonable
judgment of such counsel, it is advisable for such indemnified party to employ
separate counsel or (iii) the indemnifying party has failed to assume the
defense of such action and employ counsel reasonably satisfactory to the
indemnified party, in which case, if such indemnified party notifies the
indemnifying party in writing that it elects to employ separate counsel at the
expense of the indemnifying party shall not, in connection with any one such
action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate firm of
attorneys (in addition to one local counsel) at any time for all such
indemnified parties, which firm shall be designated in writing by Xxxxxx
Brothers Inc., if the indemnified parties under this Section 8 consist of any
Underwriters or any of their respective officers, employees or controlling
persons, or by the Company, if the indemnified parties under this Section
consist of the Company or any of the Company's directors, officers, employees
or controlling persons. No indemnifying party shall (i) without the prior
written consent of the indemnified parties (which consent shall not be
unreasonably withheld), settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding, or (ii) be liable for
any settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with the consent of
the indemnifying party or if there be a final judgment of the plaintiff in any
such action, the indemnifying party agrees to indemnify and hold harmless any
indemnified party from and against any loss or liability by reason of such
settlement or judgment.
(d) If the indemnification provided for in this Section 8
shall for any reason be unavailable to or insufficient to hold harmless an
indemnified party under Section 8(a) or 8(b) in respect of any loss, claim,
damage or liability, or any action in respect thereof, referred to therein,
then each indemnifying party shall, in lieu of indemnifying such indemnified
party, contribute to the amount paid or payable by such indemnified party as a
result of such loss, claim, damage or liability, or action in respect thereof,
(i) in such proportion as shall be appropriate to reflect the relative benefits
received by the Company on the one hand and the Underwriters on the other from
the offering of the Notes and Guarantees or (ii) if the allocation provided by
clause (i) above is not
23
permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company, on the one hand and the Underwriters on the
other with respect to the statements or omissions which resulted in such loss,
claim, damage or liability, or action in respect thereof, as well as any other
relevant equitable considerations. The relative benefits received by the
Company, on the one hand and the Underwriters on the other with respect to such
offering shall be deemed to be in the same proportion as the total net proceeds
from the offering of the Stock purchased under this Agreement (before deducting
expenses) received by the Company, on the one hand, and the total underwriting
discounts and commissions received by the Underwriters with respect to the
Notes and Guarantees purchased under this Agreement, on the other hand, bear to
the total gross proceeds from the offering of the Notes and Guarantees under
this Agreement, in each case as set forth in the table on the cover page of the
Prospectus. The relative fault shall be determined by reference to whether the
untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the
Company or the Underwriters, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company, the Guarantors and the Underwriters agree
that it would not be just and equitable if contributions pursuant to this
Section were to be determined by pro rata allocation (even if the Underwriters
were treated as one entity for such purpose) or by any other method of
allocation which does not take into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as a
result of the loss, claim, damage or liability, or action in respect thereof,
referred to above in this Section shall be deemed to include, for purposes of
this Section 8(d), any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Section 8(d), no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the Stock underwritten by it and distributed to the public
was offered to the public exceeds the amount of any damages which such
Underwriter has otherwise paid or become liable to pay by reason of any untrue
or alleged untrue statement or omission or alleged omission. No person guilty
of fraudulent misrepresentation (within the meaning of Section 8(e) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations to
contribute as provided in this Section 8(d) are several in proportion to their
respective underwriting obligations and not joint.
(e) The Underwriters severally confirm and the Company and
the Guarantors acknowledge that the statements with respect to the public
offering of the Notes and Guarantees by the Underwriters and the last sentence
of the fourth paragraph on the cover page of, the legend concerning
stabilization on page (i) of, and the fourth, fifth, sixth and seventh
paragraphs appearing under the caption "Underwriting" in, the Prospectus are
correct and constitute the only information concerning such Underwriters
furnished in writing to the Company by or on behalf of the Underwriters
specifically for inclusion in the Registration Statement and the Prospectus.
24
9. Market-Maker Prospectus.
(a) The Company acknowledges that any broker or dealer
registered under the Exchange Act (a "Broker-Dealer") that is an affiliate of
the Company and that the holds Notes and Guarantees that are acquired for its
own account as a result of market-making activities or other trading activities
(such Notes and Guarantees are referred to herein as "Broker-Dealer Transfer
Restricted Securities" and such Broker-Dealers are referred to herein as
"Restricted Broker-Dealers") may not resell such Broker-Dealer Transfer
Restricted Securities without delivering a prospectus. Consequently, the
Company and the Guarantors shall cause the Registration Statement to include
alternate prospectus pages (in a form included in the Registration Statement)
relating to such market-making activities. The prospectus included in such
Registration Statement, as it may be amended or supplemented from time-to time,
including such alternate pages, is referred to in this Agreement as a
"Market-Maker Prospectus."
(b) Following the Effective Time and until such time as all
Restricted Broker-Dealers determine in their judgment that they are no longer
required to deliver a prospectus in connection with sales of Broker-Dealer
Transfer Restricted Securities, the Company and the Guarantors shall:
(i) use all commercially reasonable efforts to deliver
Market-Maker Prospectuses to all Restricted Broker-Dealers immediately
after the Delivery Date and from time to time thereafter upon request,
in such quantities as such Restricted Broker-Dealer shall require;
(ii) use all commercially reasonable efforts to keep the
Registration Statement continuously effective and provide all
requisite financial statements, including, if required by the
Securities Act or the Rules and Regulations, financial statements of
any guarantors of the Notes;
(iii) upon the occurrence of any event that would cause the
Registration Statement or any Market-Maker Prospectus (A) contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading or (B) not to be effective and usable for
resale of Broker-Dealer Transfer Restricted Securities, file promptly,
an appropriate amendment to the Registration Statement, in the case of
clause (A), correcting any such misstatement or omission, and, in the
case of either clause (A) or (B), use all commercially reasonable
efforts to cause such amendment to be declared effective and the
Registration Statement and the Market-Maker Prospectus to become
usable for their intended purpose as soon as practicable thereafter.
Notwithstanding anything to the contrary herein, at any time after the
Delivery Date, the Company may allow the Market-Maker Prospectus and
the related Registration Statement to cease to be effective and usable
if (x) the board of directors of the Company determines in good faith
that it is in the best interests of the Company not to disclose the
existence of or facts surrounding any proposed or pending material
corporate transaction involving the Company, and the Company notifies
all Restricted Broker-Dealers within two business days after the board
of directors makes such determination, or (y) the Market-Maker
Prospectus and the related Registration Statement
25
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading;
(iv) prepare and file with the Commission such post-effective
amendments to the Registration Statement and related Market-Maker
Prospectuses as may be necessary to keep them effective, to the extent
necessary to ensure that they are available for sales of Broker-Dealer
Transfer Restricted Securities by Restricted Broker-Dealers, and to
ensure that they conform with the requirements of this Agreement and
the Securities Act and the Rules and Regulations; cause the
Market-Maker Prospectus to be supplemented by any required prospectus
supplement, and as so supplemented to be filed pursuant to Rule 424
under the Securities Act, and to comply fully with the applicable
provisions of Rules 424 and 430A under the Securities Act in a timely
manner; and comply with the provisions of the Securities Act with
respect to the Registration Statement;
(v) advise the Restricted Broker-Dealers, promptly and, if
requested by such Restricted Broker-Dealers, to confirm such advice in
writing, (A) when the Market-Maker Prospectus or any Market-Maker
Prospectus supplement or post-effective amendment has been filed, and,
with respect to any post-effective amendment with respect to the
Registration Statement, when the same has become effective, (B) of any
request by the Commission for amendments to the Registration Statement
or amendments or supplements to the Market-Maker Prospectus or for
additional information relating thereto, (C) of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement under the Securities Act or of the suspension
by any state securities commission of the qualification of the
Broker-Dealer Transfer Restricted Securities for offering or sale in
any jurisdiction, or the initiation of any proceeding for any of the
preceding purposes, and (D) of the existence of any fact or the
happening of any event that makes any statement of a material fact
made in the Registration Statement, the Market-Maker Prospectus, any
amendment or supplement thereto, or any document incorporated by
reference therein untrue, or that requires the making of any additions
to or changes in the Registration Statement or the Prospectus in order
to make the statements therein not misleading. If at any time the
Commission shall issue any stop order suspending the effectiveness of
the Registration Statement, or any state securities commission or
other regulatory authority shall issue an order suspending the
qualification or exemption from qualification of the Broker-Dealer
Transfer Restricted Securities, as applicable, under state securities
or Blue Sky laws, the Company and the Guarantors shall use all
commercially reasonable efforts to obtain the withdrawal or lifting of
such order at the earliest possible time;
(vi) furnish to each Restricted Broker-Dealer before filing
with the Commission, copies of any Registration Statement or any
Market-Maker Prospectus included therein or any amendments or
supplements to any such Registration Statement or Market-Maker
Prospectus (including all documents incorporated by reference), which
documents will be subject to the review of such Restricted
Broker-Dealers for a period of at least five business days, and the
Company and the Guarantors will not file any amendment or supplement
to any such Registration Statement or Market-Maker
26
Prospectus (including all such documents incorporated by reference) if
the Restricted Broker-Dealers shall not have had an opportunity to
participate in the preparation thereof;
(vii) promptly prior to the filing of any document that is to
be incorporated by reference into a Registration Statement or
Market-Maker Prospectus, provide copies of such document to each
Restricted Broker-Dealer, make the Company's representatives available
for discussion of such document and other customary due diligence
matters, and include such information in such document prior to the
filing thereof as such Restricted Broker-Dealers reasonably may
request;
(viii) make available at reasonable times at the Company's
principal place of business for inspection by the Restricted
Broker-Dealers, and any attorney or accountant retained by such
Restricted Broker-Dealers, such financial and other information of the
Company and the Guarantors as reasonably requested and cause the
Company's officers, directors and employees to respond to such
inquiries as shall be reasonably necessary, in the reasonable judgment
of counsel to such Restricted Broker-Dealers, to conduct a reasonable
investigation; provided, however, that each such party shall be
required to maintain in confidence and not to disclose to any other
person any information or records reasonably designated by the Company
in writing as being confidential, until such time as (A) such
information becomes a matter of public record (whether by virtue of
its inclusion in such Registration Statement or otherwise), or (B)
such person shall be required so to disclose such information pursuant
to the subpoena or order of any court or other governmental agency or
body having jurisdiction over the matter (subject to the requirements
of such order, and only after such person shall have given the Company
prompt prior written notice of such requirement), or (C) such
information is required to be set forth in such Registration Statement
or the Market-Maker Prospectus included therein or in an amendment to
such Registration Statement or an amendment or supplement to such
Market-Maker Prospectus in order that such Registration Statement,
Market-Maker Prospectus, amendment or supplement, as the case may be,
does not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading;
(ix) if requested by any Restricted Broker-Dealer, promptly
incorporate in any Registration Statement or Market-Maker Prospectus,
pursuant to a supplement or post-effective amendment if necessary,
such information as such Restricted Broker-Dealer may reasonably
request to have included therein and make all required filings of such
Market-Maker Prospectus supplement or post-effective amendment as soon
as practicable after the Company is notified of the matters to be
incorporated in such Market-Maker Prospectus supplement or
post-effective amendment;
(x) furnish to each Restricted Broker-Dealer each amendment
and supplement to the Registration Statement at least one conformed
copy, including all documents incorporated by reference therein and
all exhibits, including exhibits incorporated therein by reference;
27
(xi) deliver to each Restricted Broker-Dealer, as many copies
of any amendment or supplement to the Market-Maker Prospectus as such
Restricted Broker-Dealers reasonably may request; the Company and the
Guarantors hereby consent to the use of any Market-Maker Prospectus
and any amendment or supplement thereto by each Restricted
Broker-Dealer in connection with the offering and the sale of
Broker-Dealer Transfer Restricted Securities covered by such
Market-Maker Prospectus or any amendment or supplement thereto;
(xii) take all such other actions to expedite or facilitate
the disposition of the Broker-Dealer Transfer Restricted Securities
pursuant to the Registration Statement to such extent as may be
requested by a Restricted Broker-Dealer; provided, that, the Company
and the Guarantors shall not be required to enter into any agreement
more than once with respect to all of the Broker-Dealer Restricted
Securities; and the Company and the Guarantors shall, if requested by
Xxxxxx Brothers Inc.:
(A) furnish to each Restricted Broker-Dealer, in
such substance and scope as they may request and as are
customarily made in connection with an offering of debt
securities pursuant to a Registration Statement upon the
filing of any amendment or supplement to any Registration
Statement or any other document that is incorporated in any
Registration Statement by reference and includes financial
data with respect to a fiscal quarter or year:
(1) a certificate, dated the date of such
amendment or supplement and substantially in the
form of the certificate specified by Section 7(k),
provided that such certificate shall speak as of its
date;
(2) an opinion of counsel of the Company
and the Guarantors, dated the date of such amendment
or supplement and covering the matters set forth in
paragraphs (d) and (e) of Section 7 and such other
matter as such parties may reasonably request, and
in any event including a statement to the effect
that such counsel has participated in conferences
with officers and other representatives of the
Company, representatives of the independent public
accountants for the Company, the Underwriters'
representatives and the Underwriters' counsel in
connection with the preparation of such amendment or
supplement and have considered the matters required
to be stated therein and the statements contained
therein, although such counsel has not independently
verified the accuracy, completeness or fairness of
such statements; and that such counsel advises that,
on the basis of the foregoing (relying as to
materiality to a large extent upon facts provided to
such counsel by officers and other representatives
of the Company and without independent check or
verification), no facts came to such counsel's
attention that caused such counsel to believe that
the Registration Statement, at the time any
post-effective amendment thereto became effective,
contained an untrue statement of a material fact or
omitted to state a material fact required to
28
be stated therein or necessary to make the statements
therein not misleading, or that the Market-Maker
Prospectus contained in such Registration Statement
amendment as of its date, contained an untrue
statement of a material fact or omitted to state a
material fact necessary in order to make the
statements therein, in light of the circumstances
under which they were made, not misleading. Such
counsel may state further that such counsel assumes
no responsibility for, and has not independently
verified, the accuracy, completeness or fairness of
the financial statements, notes and schedules and
other financial data included in any Registration
Statement contemplated by this Agreement or the
related Market-Maker Prospectus; and
(3) customary comfort letter(s), dated the
date of such amendment or supplement from the
Company's independent accountants, in the customary
form and covering matters of the type customarily
covered in comfort letters by underwriters in
connection with underwritten offerings, and
affirming the matters set forth in the comfort
letters delivered pursuant to Section 7 of the
Purchase Agreement, without exception; and
(B) deliver such other documents and certificates as
may be reasonably requested by such Restricted Broker-Dealers to evidence
compliance with clause (A) above.
(xiii) cooperate with the Restricted Broker-Dealers and their
respective counsel in connection with the registration and
qualification of the Broker-Dealer Transfer Restricted Securities
under the securities or Blue Sky laws of such jurisdictions as the
Restricted Broker-Dealers may reasonably request and do any and all
other acts or things necessary or advisable to enable the disposition
in such jurisdictions of the Broker-Dealer Transfer Restricted
Securities the Registration Statement; provided, however, that the
Company and the Guarantors shall not be required to register or
qualify as a foreign corporation where it is not now so qualified or
to take any action that would subject it to the service of process in
suits or to taxation, other than as to matters and transactions
relating to the Registration Statement, in any jurisdiction where it
is not now so subject;
(c) Each Restricted Broker-Dealer agrees by acquisition of
Broker-Dealer Transfer Restricted Securities that, upon receipt of any notice
from the Company of the existence of any fact of the kind described in Section
9(b)(iii) hereof, such Restricted Broker-Dealer will forthwith discontinue
disposition of Broker-Dealer Transfer Restricted Security pursuant to the
applicable Registration Statement until such Restricted Broker-Dealer's receipt
of the copies of the supplemented or amended Market-Maker Prospectus
contemplated by this Section 9, or until it is advised in writing (the
"Advice") by the Company that the use of the Market-Maker Prospectus may be
resumed, and has received copies of any additional or supplemental filings that
are incorporated by reference in the Market-Maker Prospectus. If so directed by
the Company, each Restricted Broker-Dealer will deliver to the Company (at the
Company's
29
expense) all copies, other than permanent file copies then in such Restricted
Broker-Dealers' possession, of the Market-Maker Prospectus covering such
Broker-Dealer Transfer Restricted Security that was current at the time of
receipt of such notice.
The Company may require each Restricted Broker-Dealer to
furnish to the Company such information regarding such Restricted Broker-Dealer
and such Restricted Broker-Dealers' intended method of distribution of the
applicable Broker-Dealer Transfer Restricted Securities as the Company may from
time to time reasonably request in writing, but only to the extent that such
information is required in order to comply with the Securities Act. Each such
Restricted Broker-Dealer agrees to notify the Company as promptly as
practicable of (i) any inaccuracy or change in information previously furnished
by such Restricted Broker-Dealer to the Company or (ii) the occurrence of any
event, in either case, as a result of which any Market-Maker Prospectus
contains or would contain an untrue statement of a material fact regarding such
Restricted Broker-Dealer or such Restricted Broker-Dealers' intended method of
distribution of the applicable Broker-Dealer Transfer Restricted Securities or
omits to state any material fact regarding such Restricted Broker-Dealer or
such Restricted Broker-Dealers' intended method of distribution of the
applicable Broker-Dealer Transfer Restricted Securities required to be stated
therein or necessary to make the statements therein not misleading and promptly
to furnish to the Company any additional information required to correct and
update any previously furnish to the Company any additional information
required to correct and update any previously furnished information or required
so that such Market-Maker Prospectus shall not contain, with respect to such
Restricted Broker-Dealer or the distribution of the applicable Broker-Dealer
Transfer Restricted Securities an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein not misleading.
(d) For the purposes of Section 8, the term "Underwriter"
shall include Restricted Broker-Dealers and the terms "Prospectus" and
"Registration Statement" shall include Market-Maker Prospectuses and related
Registration Statements and all amendments and supplements thereto.
10. Termination. The obligations of the Underwriters
hereunder may be terminated by the Underwriters by notice given to and received
by the Company prior to delivery of and payment for the Notes and Guarantees
if, prior to that time, any of the events described in Sections 7(l), 7(m) or
7(n), shall have occurred or if the Underwriters shall decline to purchase the
Notes for any reason permitted under this Agreement.
11. Reimbursement of Underwriters' Expenses. If (a) the
Company and the Guarantors shall fail to tender the Notes and the Guarantees
for delivery to the Underwriters by reason of any failure, refusal or inability
on the part of the Company and the Guarantors to perform any agreement on its
part to be performed, or because any other condition of the Underwriters'
obligations hereunder required to be fulfilled by the Company and the
Guarantors is not fulfilled, the Company and the Guarantors will reimburse the
Underwriters for all reasonable out-of-pocket expenses (including fees and
disbursements of counsel) incurred by the Underwriters in connection with this
Agreement and the proposed purchase of the Notes and Guarantees, and upon
demand the
30
Company and the Guarantors shall pay the full amount thereof to the
Underwriter(s). If this Agreement is terminated pursuant to Section 10 by
reason of the default of one or more Underwriters, the Company and the
Guarantors shall not be obligated to reimburse any defaulting Underwriter on
account of those expenses.
12. Notices, etc. All statements, requests, notices and
agreements hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or
sent by mail, telex or facsimile transmission to Xxxxxx
Brothers Inc., Three World Financial Center, New York, New
York 10285, Attention: Syndicate Department (Fax:
212-526-6588), with a copy, in the case of any notice
pursuant to Section 8(c), to the Director of Litigation,
Office of the General Counsel, Xxxxxx Brothers Inc., 0 Xxxxx
Xxxxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000;
(b) if to the Company and the Guarantors, shall be
delivered or sent by mail, telex or facsimile transmission to
the address of the Company set forth in the Registration
Statement, Attention: Xxxxxxxxxxx X. Xxxxxxx (Fax:
212-805-5494);
provided, however, that any notice to an Underwriter pursuant to Section 8(c)
shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its acceptance telex to the
Underwriters, which address will be supplied to any other party hereto by the
Underwriters upon request. Any such statements, requests, notices or agreements
shall take effect at the time of receipt thereof. The Company shall be entitled
to act and rely upon any request, consent, notice or agreement given or made on
behalf of the Underwriters by Xxxxxx Brothers Inc.
13. Persons Entitled to Benefit of Agreement. This Agreement
shall inure to the benefit of and be binding upon the Underwriters, any
Restricted Broker-Dealers, the Company, the Guarantors and their respective
successors. This Agreement and the terms and provisions hereof are for the sole
benefit of only those persons, except that (A) the representations, warranties,
indemnities and agreements of the Company and the Guarantors contained in this
Agreement shall also be deemed to be for the benefit of (i) the person or
persons, if any, who control any Underwriter within the meaning of Section 15
of the Securities Act (and controlling persons thereof) who offers or sells any
Notes and Guarantees in accordance with the terms of the Agreement Between
Underwriters and International Managers and (ii) X. X. Xxxxxxxxx, Towbin,
solely in its role as qualified independent underwriter pursuant to the rules
of the National Association of Securities Dealers, Inc., and (B) the indemnity
agreement of the Underwriters contained in Section 8(c) of this Agreement shall
be deemed to be for the benefit of directors of the Company and the Guarantors,
officers of the Company and the Guarantors who have signed the Registration
Statement and any person controlling the Company and the Guarantors within the
meaning of Section 15 of the Securities Act. Nothing in this Agreement is
intended or shall be construed to give any person, other than the persons
referred to in this Section 13, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision contained herein.
31
14. Survival. The respective indemnities, representations,
warranties and agreements of the Company, the Guarantors and the Underwriters
contained in this Agreement or made by or on behalf on them, respectively,
pursuant to this Agreement, shall survive the delivery of and payment for the
Notes and Guarantees and shall remain in full force and effect, regardless of
any investigation made by or on behalf of any of them or any person controlling
any of them.
15. Definition of the Terms "Business Day" and "Subsidiary."
For purposes of this Agreement, (a) "business day" means each Monday, Tuesday,
Wednesday, Thursday or Friday which is not a day on which banking institutions
in New York are generally authorized or obligated by law or executive order to
close and (b) "subsidiary" has the meaning set forth in Rule 405 of the Rules
and Regulations.
16. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF NEW YORK.
17. Counterparts. This Agreement may be executed in one or
more counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
18. Headings. The headings herein are inserted for
convenience of reference only and are not intended to be part of, or to affect
the meaning or interpretation of, this Agreement.
[Signature pages follow]
32
If the foregoing correctly sets forth the agreement among the
Company, the Guarantors and the Underwriters, please indicate your acceptance
in the space provided for that purpose below.
Very truly yours,
L-3 COMMUNICATIONS CORPORATION
By
--------------------------------------
Name:
Title:
HYGIENETICS ENVIRONMENTAL SERVICES, INC.
By
--------------------------------------
Name:
Title:
L-3 COMMUNICATIONS ILEX SYSTEMS, INC.
By
--------------------------------------
Name:
Title:
SOUTHERN CALIFORNIA MICROWAVE, INC.
By
--------------------------------------
Name:
Title:
Accepted:
XXXXXX BROTHERS INC.
BANCAMERICA XXXXXXXXX XXXXXXXX
By XXXXXX BROTHERS INC.
By
-----------------------------
Authorized Representative
SCHEDULE 1
Principal
Underwriters Amount of Notes
------------ ---------------
Xxxxxx Brothers Inc..........................................
BancAmerica Xxxxxxxxx Xxxxxxxx............................... _______________
Total $150,000,000
34
