Exhibit 10.10
$400,000,000
Landry’s Restaurants, Inc.
(a Delaware corporation)
7.50% Senior Notes due 2014
PURCHASE AGREEMENT
December 15, 2004
December 15, 2004
Wachovia Capital Markets, LLC
Banc of America Securities LLC
Deutsche Bank Securities Inc.
c/o Wachovia Capital Markets, LLC
One Wachovia Center
301 South College Street
Charlotte, North Carolina
28288
Ladies and Gentlemen:
Landry’s Restaurants, Inc., a
Delaware corporation (the “ Company ”), proposes
to issue and sell (the “ Offering ”) to the
several purchasers named in Schedule I hereto (the “
Initial Purchasers ”), for whom Wachovia Capital
Markets, LLC is acting as Representative (in such capacity, the
“ Representative ”), $400,000,000 aggregate
principal amount of its 7.50% Senior Notes due 2014 (the “
Notes ”), which will be unconditionally guaranteed on
a senior basis as to principal, premium, if any, and interest (the
“ Guarantees ”) by the subsidiaries of the
Company named in Schedule II hereto (each individually, a “
Guarantor ” and collectively, the “
Guarantors ”). The Notes will be issued pursuant to an
Indenture (the “ Indenture ”) dated as of the
Closing Date (as defined in Section 2) among the Company, the
Guarantors and Wachovia Bank, National Association, as Trustee (the
“ Trustee ”). The Initial Purchasers and their
direct and indirect transferees will be entitled to the benefits of
a Registration Rights Agreement, to be dated the Closing Date,
between the Initial Purchasers and the Company (the “
Registration Rights Agreement ”). This Agreement, the
Registration Rights Agreement, the Indenture and the Credit
Agreement (as defined below) are hereinafter collectively referred
to as the “ Transaction Documents ” and the
execution and delivery of the Transaction Documents and the
transactions contemplated herein and therein, and as contemplated
in each Memorandum (as defined below), are hereinafter collectively
referred to as the “ Transactions .”
The Notes (and the related
Guarantees) will be offered and sold through the Initial Purchasers
without being registered under the Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder
(collectively, the “ Securities Act ”), to
qualified institutional buyers in compliance with the exemption
from registration provided by Rule 144A under the Securities Act
and in offshore transactions in reliance on Regulation S under the
Securities Act (“ Regulation S ”). The Initial
Purchasers have advised the Company that they will offer and sell
the Notes purchased by them hereunder in accordance with Section 3
hereof as soon as the Representative deems advisable.
Concurrently with the closing of the
offering of the Notes, the Company, as borrower, and each of the
Company’s current and future subsidiaries, as guarantors,
will enter into a senior secured credit in an aggregate principal
amount of up to $450.0 million, pursuant to a Credit Agreement with
Wachovia Capital Markets, LLC, Banc of America Securities LLC and
Deutsche Bank Securities Inc. as joint lead arrangers and joint
bookrunning managers, Wachovia Bank, National Association, as
administrative agent and syndication agent, and the other
lenders
and agents named therein (such agreement,
together with the related security agreements and other agreements
and instruments, the “ Credit Agreement ”). Such
Credit Agreement will provide for $150.0 million in term loan
borrowings and $300.0 million in revolving credit borrowings. The
proceeds of the Offering, together with borrowings under the Credit
Agreement, will be used (1) to prepay all amounts and other
obligations outstanding under the Company’s existing Second
Amended and Restated Credit Agreement dated as of October 14, 2003,
among the Company, Bank of America, N.A., the lenders party thereto
and Banc of America Securities LLC, as amended by Amendment No. 1
dated as of October 22, 2004 (as amended, the “ Existing
Credit Agreement ”), (2) to prepay $150.0 million
aggregate principal amount outstanding of the Company’s
Senior Secured Notes (the “ Existing Senior Notes
”), issued pursuant to an Uncommitted Master Shelf Agreement
dated as of October 1, 2003, among the Company, Prudential
Investment Management, Inc. and the Prudential Affiliates party
thereto (the “ Master Shelf Agreement ”), (3) to
pay related transaction fees and expenses, and (4) for general
corporate purposes, which may include acquisitions and other
investment and repurchases of the Company’s common stock, as
described in the Final Memorandum (defined below) under the caption
“Use of Proceeds,” (collectively referred to as the
“ Related Transactions ”).
In connection with the sale of the
Notes, the Company has prepared a preliminary offering memorandum,
dated December 3, 2004 (the “ Preliminary Memorandum
”) and a final offering memorandum, dated the date of this
Agreement (the “ Final Memorandum ” and,
together with the Preliminary Memorandum, each a “
Memorandum ”). Each Memorandum sets forth certain
information concerning the Company, the Notes, the Transaction
Documents and the Transactions and includes (a) the Company’s
Annual Report on Form 10-K/A for the year ended December 31, 2003
(the “ Form 10-K ”) and (b) the Company’s
Quarterly Report on Form 10-Q for the quarterly period ended
September 30, 2004 (the “ Form 10-Q ”); each of
(a) and (b) are attached to each Memorandum as an annex thereto.
The Company hereby confirms that it has authorized the use of the
Preliminary Memorandum and the Final Memorandum, and any amendment
or supplement thereto, in connection with the offer and sale of the
Notes by the Initial Purchasers. Except where specifically noted,
all references to the “Preliminary Memorandum” shall
mean such Memorandum, as amended and supplemented and shall include
the Form 10-K and Form 10-Q attached as annexes thereto, as of the
date appearing on its cover and all references to the “Final
Memorandum” shall mean such Memorandum, as amended and
supplemented and shall include the Form 10-K and Form 10-Q attached
as annexes thereto, as of the date of this Agreement.
1. Representations and Warranties
of the Company and the Guarantors . The Company and the
Guarantors jointly and severally represent and warrant to, and
agree with, each of the Initial Purchasers that:
(a) The Preliminary Memorandum, in
the form used to offer the Notes, and the Final Memorandum in the
form used to offer and confirm sales of the Notes, does not, and
will not at the Closing Date contain any untrue statement of a
material fact or omit to state any material fact necessary to make
the statements therein, in light of the circumstances under which
they were made, not misleading; provided , however ,
that the representations or warranties set forth in this paragraph
shall not apply to statements in or omissions from either
Memorandum made in reliance upon and in conformity with information
furnished in writing to the Company by the
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Initial Purchasers expressly for use therein, as
specified in Section 11. The Form 10-K and the Form 10-Q included
as annexes to each Memorandum are, in form and content, identical
to the Form 10-K and Form 10-Q filed by the Company with the
Securities and Exchange Commission (the “ Commission
”). The statistical, market share and industry data included
in each Memorandum are based on or derived from sources that the
Company believes to be reliable and accurate and consent for the
use of such data in each Memorandum has been obtained or is not
required.
(b) The Company has been duly
organized and is validly existing as a corporation in good standing
under the laws of the State of Delaware. The Company is duly
qualified to do business as a foreign corporation and is in good
standing under the laws of each jurisdiction in which the conduct
of its business or its ownership or leasing of property requires
such qualification, except where the failure to so qualify or to be
in good standing would not have a Material Adverse Effect. “
Material Adverse Effect ” shall mean a material
adverse change in or effect on or any development having a
prospective material adverse effect on (i) the business,
operations, properties, stockholders’ equity, condition
(financial or otherwise), results of operations or prospects of the
Company and its subsidiaries, considered as one enterprise, whether
or not in the ordinary course of business, or (ii) the ability of
the Company and each Guarantor to perform its obligations under the
Notes or the Transaction Documents.
(c) Each of the Company and each of
the Company’s subsidiaries has full power (corporate and
other) to own or lease its properties and conduct its business as
described in each Memorandum except where the failure to have such
power would not have a Material Adverse Effect; and each of the
Company and the Guarantors has full power (corporate and other) to
enter into the Transaction Documents and carry out all the terms
and provisions hereof and thereof to be carried out by them and to
consummate the Offering and the Related Transactions.
(d) All of the issued shares of
capital stock of the Company have been duly authorized and validly
issued and are fully paid and nonassessable; none of the
outstanding shares of capital stock of the Company was issued in
violation of the preemptive or other similar rights of any security
holder of the Company.
(e) Each subsidiary of the Company
has been duly formed or incorporated, as the case may be, is
validly existing as a corporation, partnership or a limited
liability company, as the case may be, in good standing under the
laws of the jurisdiction of its formation or incorporation, has the
power and authority to own its property and to conduct its business
as described in each Memorandum and is duly qualified to transact
business and is in good standing in each jurisdiction in which the
conduct of its business or its ownership or leasing of property
requires such qualification, except where the failure to be in good
standing, to have such power or authority or to so qualify would
not have a Material Adverse Effect. All of the outstanding shares
of capital stock and other ownership interests, as applicable, of
each subsidiary have been duly and validly authorized and issued,
are fully paid and non-assessable and are owned directly or through
wholly owned subsidiaries by the Company, free and clear of all
liens, encumbrances, equities or claims. The Company does not own
or control, directly or indirectly, any corporation, association or
other entity other than the subsidiaries listed on Schedule
III hereto and each such subsidiary is organized in the
jurisdiction set forth beside such subsidiary’s name on
Schedule III . As used in this Agreement, “
subsidiary ” or “ subsidiaries ”
shall mean both direct and indirect subsidiaries of an
entity.
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(f) No subsidiary of the Company is
prohibited, directly or indirectly, from paying any dividends to
the Company, making any other distribution on such
subsidiary’s capital stock or other ownership interest, as
applicable, repaying any loans or advances made by the Company or
transferring any property or assets to the Company or any other
subsidiary of the Company, except to the extent provided in the
Indenture or as disclosed in the Final Memorandum.
(g) (i) Ernst & Young LLP, who
have certified the consolidated financial statements (which term as
used in this Agreement includes the related notes thereto) of the
Company set forth in the Final Memorandum for the years ended
December 31, 2002 and 2003 and delivered reports with respect to
the audited consolidated financial statements included in the Final
Memorandum, were at the time they expressed their opinions in such
reports independent public accountants with respect to the Company
within the meaning of the Securities Act and the applicable rules
and regulations thereunder. Arthur Andersen LLP, who have certified
the consolidated financial statements of the Company for the years
ended December 31, 1999, 2000 and 2001 and delivered reports with
respect to the audited financial statements of the Company for such
periods, were, at the time they expressed their opinions in such
reports, independent public accountants with respect to the Company
within the meaning of the Securities Act and applicable rules and
regulations thereunder.
(ii) Grant Thornton LLP, who have
performed a review pursuant to Statement on Auditing Standards No.
100, of the interim consolidated financial statements of the
Company set forth in the Final Memorandum for the quarterly period
ended September 30, 2004, are independent registered public
accountants with respect to the Company within the meaning of the
Securities Act and the applicable rules and regulations
thereunder.
(h) The financial statements
(including the notes and schedules thereto) of the Company and its
consolidated subsidiaries included in the annexes to the Final
Memorandum fairly present the financial position, results of
operations, cash flows and changes in stockholders’ equity of
the Company and its consolidated subsidiaries as of the dates and
for the periods specified therein; such financial statements have
been prepared in accordance with generally accepted accounting
principles (“ GAAP ”) consistently applied
throughout the periods involved (except as otherwise expressly
disclosed in the notes thereto) and comply as to form with the
applicable accounting requirements of the Securities Act and the
related rules and regulations; the information set forth under the
captions “Offering Memorandum Summary – Summary
Financial Data” in the Final Memorandum and in the Form 10-K
under the caption “Item 6. Selected Financial Data” has
been accurately extracted from the financial statements of the
Company and its consolidated subsidiaries, fairly presents the
information included therein and has been compiled on a basis
consistent with that of the audited financial statements included
in the Final Memorandum; the ratios of earnings to fixed charges
set forth in the Final Memorandum under the caption “Offering
Memorandum Summary – Summary Financial Data” have been
calculated in compliance with Item 503(d) of Regulation S-K
(“ Regulation S-K ”) under the Securities Act;
the non-GAAP financial measures set forth in each Memorandum comply
with Regulation G and Item 10(e) of Regulation S-K.
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(i) Subsequent to the respective
dates as of which information is given in the Final Memorandum, (i)
there has been no change nor any development or event involving a
prospective change which has had or could reasonably be expected to
have a Material Adverse Effect; (ii) none of the Company and its
subsidiaries have incurred any material liability or obligation,
direct or contingent, or entered into any material transaction, in
each case, not in the ordinary course of business; and (iii) there
has not been any material change in the capital stock, short-term
debt or long-term debt of the Company and its subsidiaries, except
in each case as disclosed in the Final Memorandum.
(j) The Company and each of its
subsidiaries maintains a system of internal accounting controls
sufficient to provide reasonable assurances that (i) transactions
are executed in accordance with management’s general or
specific authorizations; (ii) transactions are recorded as
necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain asset accountability; (iii) access to assets is permitted
only in accordance with management’s general or specific
authorization; and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences. The
disclosure controls and procedures (as such term is defined in Rule
13a-14 and 15d-14 under the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder
(collectively, the “ Exchange Act ”) of the
Company and each of its subsidiaries provide reasonable assurance
that material information relating to the Company and its
subsidiaries is made known to the Company’s Chief Executive
Officer and Chief Financial Officer and, based on an evaluation
conducted not earlier than September 30, 2004; there are no
significant deficiencies or weaknesses in the design or operations
of internal controls that could adversely affect the
Company’s ability to record, process and report financial
data and other information required to be disclosed in the reports
filed or furnished by the Company pursuant to the Exchange
Act.
(k) The Company is subject to and in
full compliance with the reporting requirements of Section 13 or
Section 15(d) of the Exchange Act.
(l) This Agreement has been duly
authorized, executed and delivered by the Company and each
Guarantor.
(m) The Indenture and the
Registration Rights Agreement have been duly authorized by the
Company and each Guarantor and, on the Closing Date, will have been
duly executed and delivered by the Company and each Guarantor, and
will constitute the legal, valid and binding obligations of the
Company and each Guarantor, enforceable against the Company and
each Guarantor in accordance with their respective terms and the
Indenture and the Registration Rights Agreement will conform to the
description thereof in the Final Memorandum and will be
substantially in the form previously delivered to you.
(n) The Indenture, as executed by
the Company and each Guarantor, will conform to the requirements of
the Trust Indenture Act of 1939, as amended (the “ Trust
Indenture Act ”), and to the rules and regulations of the
Commission applicable to an indenture that is qualified
thereunder.
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(o) The Notes and the Exchange Notes
(as defined in the Registration Rights Agreement) have been duly
authorized and, when executed and authenticated in the manner
provided for in the Indenture and delivered to and paid for by the
Initial Purchasers as provided in this Agreement, will constitute
the legal, valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms
(except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting
creditor’s rights generally or by the principles governing
the availability of equitable remedies), will conform to the
description thereof in the Final Memorandum and will be
substantially in the form previously delivered to you, and will be
entitled to the benefits of the Indenture and the Registration
Rights Agreement; the Guarantees have been duly authorized and,
upon the due issuance and delivery of the Notes or the Exchange
Notes, as applicable, and the due endorsement of the Guarantees
thereon, will have been duly executed, endorsed and delivered and
will constitute valid and legally binding obligations of each of
the Guarantors, enforceable against the Guarantors in accordance
with their terms (except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditor’s rights generally or by the
principles governing the availability of equitable remedies), and
will be entitled to the benefits of and be subject to the
provisions of the Indenture, and will conform to the description
thereof in the Final Memorandum.
(p) Neither the Company nor any of
its subsidiaries is in violation of its charter or by-laws or is in
default (or, with the giving of notice or lapse of time, would be
in default) (“ Default ”) under any indenture,
mortgage, loan or credit agreement, note, contract, franchise,
lease or other instrument to which any of the Company or its
subsidiaries is a party or by which any of them may be bound, or to
which any of the property or assets of any of the Company or its
subsidiaries is subject (each, an “ Existing
Instrument ”), except for such Defaults as would not,
individually or in the aggregate, result in a Material Adverse
Effect.
(q) The execution, delivery and
performance of this Agreement by the Company and the Guarantors,
the execution, delivery and performance of the Registration Rights
Agreement, the Indenture and the Credit Agreement, and issuance and
delivery of the Notes or the Exchange Notes and the Guarantees by
the Company and each Guarantor, as applicable, and the consummation
of the Offering, the Related Transactions and the other
transactions contemplated by the Final Memorandum (i) have been
duly authorized by all necessary corporate action and will not
result in any violation of the provisions of the charter or by-laws
or similar organizational documents of the Company or any of its
subsidiaries, (ii) will not conflict with or constitute a breach
of, or Default or a Debt Repayment Triggering Event (as defined
below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or
any of its subsidiaries pursuant to, or require the consent of any
other party to, any Existing Instrument, except for such conflicts,
breaches, Defaults, liens, charges or encumbrances as would not,
individually or in the aggregate, result in a Material Adverse
Effect, and (iii) will not result in any violation of any law,
administrative regulation or administrative or court decree
applicable to the Company or any of its subsidiaries. No consent,
approval, authorization or other order of, or registration or
filing with, any court or other governmental or regulatory
authority or agency is required for the execution, delivery and
performance by the Company and the Guarantors of this Agreement,
the Registration Rights Agreement, the Indenture and the Credit
Agreement; the Company’s execution of the Notes and the
Exchange Notes; the Guarantors’ execution, delivery and
performance of the Guarantees; and
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the consummation of the Offering and the Related
Transactions by the Company and its subsidiaries. As used herein, a
“ Debt Repayment Triggering Event ” means any
event or condition which gives, or with the giving of notice or
lapse of time would give, the holder of any note, debenture or
other evidence of indebtedness (or any person acting on such
holder’s behalf) the right to require the repurchase,
redemption or repayment of all or a portion of such indebtedness by
the Company or any of its subsidiaries.
(r) The Credit Agreement has been
duly authorized and, when executed and delivered by the Company,
will be a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or
affecting the rights and remedies of creditors generally or by
general equitable principles.
(s) An irrevocable notice of
optional prepayment of the Existing Senior Notes pursuant to
Section 4C of the Master Shelf Agreement will be properly issued
prior to the Closing Date to effect the prepayment of the total
aggregate principal amount outstanding under the Existing Senior
Notes, as described under the caption “Use of Proceeds”
in the Final Memorandum.
(t) An irrevocable notice of
prepayment of all outstanding amounts and other obligations due
under the Existing Credit Agreement will be properly issued
pursuant to Section 2.05 of the Existing Credit Agreement prior to
the Closing Date to effect a full prepayment thereof, as described
under the caption “Use of Proceeds” in the Final
Memorandum.
(u) Each of the Company and the
Guarantors is, and after giving effect to the Offering and the
Related Transactions will be, Solvent. As used herein, the term
“ Solvent ” means, with respect to an entity on
a particular date, that on such date (i) the fair market value of
the assets of such entity is greater than the total amount of
liabilities (including contingent liabilities) of such entity, (ii)
the present fair salable value of the assets of such entity is
greater than the amount that will be required to pay the
liabilities of such entity on its debts as they become absolute and
matured, (iii) such entity is able to realize upon its assets and
pay its debts and other liabilities, including contingent
obligations, as they mature and (iv) such entity does not have
unreasonably small capital.
(v) No legal or governmental
proceedings, investigations or inquiry are pending or, to the
Company’s knowledge, threatened to which the Company or any
of its subsidiaries is a party or to which any of the properties or
assets of the Company or any of its subsidiaries is subject, other
than matters adequately and accurately described in each Memorandum
or such proceedings, or investigations or inquiries that would not,
singly or in the aggregate, result in a Material Adverse
Effect.
(w) The Company and its Affiliates
(as defined in Rule 501(b) of Regulation D under the Securities Act
(“ Regulation D ”)), and their respective
agents, have not distributed and, prior to the later of (i) the
Closing Date and (ii) the completion of the distribution of the
Notes (as determined by the Representative in its sole discretion),
will not distribute any offering material in connection with the
offering and sale of the Notes other than the Preliminary
Memorandum or the Final Memorandum or any amendment or supplement
thereto that is approved by the Representative.
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(x) Except as set forth in the Final
Memorandum, each of the Company and the subsidiaries have good and
indefeasible leasehold title or title in fee simple to all real
property and marketable title to all material personal property
owned by each of them, free and clear of any pledge, lien,
encumbrance, security interest or other defect or claim of any
third party, and all existing leases of the Company and the
subsidiaries are valid, subsisting and enforceable and there is no
default (whether with or without the giving of notice or the
passage of time or both) pending or existing under any such
lease.
(y) No “prohibited
transaction” (as defined in Section 406 of the Employee
Retirement Income Security Act of 1974, as amended, including the
regulations and published interpretations thereunder (“
ERISA ”), or Section 4975 of the Internal Revenue Code
of 1986, as amended from time to time (the “ Code
”)) or “accumulated funding deficiency” (as
defined in Section 302 of ERISA) or any of the events set forth in
Section 4043(c) of ERISA (other than events with respect to which
the 30-day notice requirement under Section 4043 of ERISA has been
waived) has occurred, exists or is reasonably expected to occur
with respect to any employee benefit plan (as defined in Section
3(3) of ERISA) which the Company or its subsidiaries maintain,
contribute to or have any obligation to contribute to, or with
respect to which the Company or any of its subsidiaries has any
liability, direct or indirect, contingent or otherwise (a “
Plan ”); each Plan is in compliance in all material
respects with applicable law, including ERISA and the Code; none of
the Company or any of its subsidiaries (i) has failed to timely
make all required contributions to each Plan, or (ii) has incurred
or expects to incur liability under Title IV of ERISA with respect
to the termination of, or withdrawal from, any Plan; and each Plan
that is intended to be qualified under Section 401(a) of the Code
is so qualified, and nothing has occurred, whether by action or
failure to act, which could reasonably be expected to cause the
loss of such qualification.
(z) There is no existing, pending
or, to the Company’s knowledge, threatened labor dispute
involving the employees of the Company or any of its subsidiaries
and the Company and its subsidiaries are not aware of any existing,
pending or threatened labor dispute involving the employees of
their respective principal suppliers, manufacturers, customers or
contractors, which could reasonably be expected to result in a
Material Adverse Effect.
(aa) Except as described in the
Memorandum, no proceedings for the merger, consolidation,
liquidation or dissolution of the Company or any subsidiary of the
Company or the sale of all or a material part of the assets of the
Company and its subsidiaries or any material acquisition by the
Company or any subsidiary of the Company are pending or
contemplated.
(bb) The Company and each of its
subsidiaries owns and has taken all reasonable steps to protect, or
has obtained valid and enforceable licenses or other rights to use,
all material patents, patent applications, trademarks (both
registered and unregistered), trade secrets, service marks, trade
names, copyrights, and all other material proprietary rights and
confidential information (collectively, “ Intellectual
Property ”) described in each Memorandum or which are
necessary to conduct their respective businesses as currently
conducted, except where the failure to take such steps or obtain
such licenses or rights would not have a Material Adverse
Effect;
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none of the Company or any of its subsidiaries
is aware of any existing, pending or threatened (i) action, claim
or proceedings brought by third parties, or any circumstance, event
or development, that may interfere or result in an interference
with the ownership or use of such Intellectual Property by the
Company or any of its subsidiaries, or (ii) infringement or
unauthorized use of such Intellectual Property by a third
party.
(cc) The Company and each of its
subsidiaries is insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts
and with such deductibles as are generally deemed adequate and
customary for their businesses; and none of the Company or any of
its subsidiaries has any reason to believe that it will not be able
to renew its existing insurance coverage as and when required or to
obtain similar coverage from similar insurers as may be necessary
to continue their respective businesses at a commercially
reasonable cost.
(dd) The Company and each of its
subsidiaries is in compliance with all laws, ordinances,
regulations and orders applicable to the Company and its
subsidiaries and their respective businesses, and none of the
Company or any of its subsidiaries has received any notice to the
contrary; and each of the Company and its subsidiaries possesses
and is in compliance with the terms of all certificates,
authorizations, permits, licenses, approvals, orders and franchises
(collectively, “ Licenses ”) necessary to
conduct their respective businesses as currently operated in the
manner described in the Final Memorandum and all such Licenses are
in full force and effect, except where the failure to so comply or
possess such Licenses would not have a Material Adverse Effect. No
proceeding has been instituted or, to the Company’s
knowledge, is threatened or contemplated to terminate, withdraw or
cancel or to modify or restrict the scope of such
Licenses.
(ee) (i) The Company and each of its
subsidiaries is and has been in compliance with all applicable
laws, statutes, ordinances, rules, regulations, orders, judgments,
decisions, decrees, standards, and requirements relating to: human
health and safety; pollution; management, disposal or release of
any chemical substance, product or waste; and protection, cleanup,
remediation or corrective action relating to the environment or
natural resources (“ Environmental Law
”);
(ii) The Company and each of its
subsidiaries has obtained and is in compliance with the conditions
of all permits, authorizations, licenses, approvals and variances
necessary under any Environmental Law for the continued conduct in
the manner now conducted of their respective businesses (“
Environmental Permits ”);
(iii) There are no past or present
conditions or circumstances, including but not limited to pending
changes in any Environmental Law or Environmental Permits, that are
reasonably likely to interfere with the conduct of the business of
the Company and its subsidiaries in the manner now conducted or
which would interfere with compliance with any Environmental Law or
Environmental Permits; and
(iv) There are no past or present
conditions or circumstances at, or arising out of, their respective
businesses, assets and properties of the Company and each of its
subsidiaries or any business, assets or properties formerly leased,
operated or owned by the Company or any
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of its subsidiaries including but not limited to
on-site or off-site disposal or release of any chemical substance,
product or waste, which may give rise to: (A) liabilities or
obligations for any cleanup, remediation or corrective action under
any Environmental Law; (B) claims arising under any Environmental
Law for personal injury, property damage, or damage to natural
resources; (C) liabilities or obligations incurred by the Company
or its subsidiaries to comply with any Environmental Law; or (D)
fines or penalties arising under any Environmental Law;
except in each case for any noncompliance or
conditions or circumstances that, singly or in the aggregate, would
not result in a Material Adverse Effect.
(ff) The Company and each of its
subsidiaries has filed all foreign, federal, state and local tax
returns that are required to be filed or has requested extensions
thereof and has paid all taxes required to be paid by it and any
other assessment, fine or penalty levied against it, to the extent
that any of the foregoing is due and payable, except for any such
assessment, fine or penalty that is currently being contested in
good faith and for which the Company and its subsidiaries retains
adequate reserves, and except where the failure to file tax returns
or pay taxes and other assessments, fines or penalties would not
have a Material Adverse Effect.
(gg) There are no contracts,
agreements or understandings between the Company or any of its
subsidiaries and any person granting such person the right to
require the Company or any of its subsidiaries to file a
registration statement under the Securities Act or to require the
Company to include any securities held by any person in any
registration statement filed by the Company under the Securities
Act.
(hh) Neither the Company nor any
subsidiary of the Company is, nor after giving effect to the
offering and sale of the Notes and the application of the proceeds
thereof as described in the Final Memorandum will be, an
“investment company,” or a company
“controlled” by an “investment company,”
within the meaning of the Investment Company Act of 1940, as
amended (the “ Investment Company Act
”).
(ii) None of the Company, its
Affiliates or any person acting on its or any of their behalf
(other than the Initial Purchasers, as to which no statement is
made) has, directly or indirectly engaged in any general
solicitation or general advertising (within the meaning of
Regulation D) or a public offering within the meaning of Section
4(2) of the Securities Act with respect to the offer and sale of
the Notes.
(jj) None of the Company, its
Affiliates, or any person acting on its or their behalf (other than
the Initial Purchasers, as to which no statement is made) has,
directly or indirectly, engaged in any directed selling efforts
with respect to the Notes, and each of them has complied with the
offering restrictions requirement of Regulation S. Terms used in
this paragraph have the meanings given to them by Regulation
S.
(kk) None of the Company, its
Affiliates or any person acting on its or their behalf has (i)
taken, directly or indirectly, any action designed to cause or
result in, or which has constituted or which might reasonably be
expected to cause or result in, stabilization or manipulation of
the price of any security of the Company to facilitate the sale or
resale of the Notes, or (ii) paid or agreed to pay to any person
any compensation for underwriting or soliciting another to purchase
any securities of the Company (except as contemplated by this
Agreement).
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(ll) The Notes satisfy the
eligibility requirements of Rule 144A(d)(3) under the Securities
Act.
(mm) Assuming the accuracy of the
representations and warranties of the Initial Purchasers in Section
3 hereof and compliance by the Initial Purchasers with the
procedures set forth in Section 3 hereof, it is not necessary in
connection with the offer, sale and delivery of the Notes to the
Initial Purchasers in the manner contemplated by this Agreement and
disclosed in the Preliminary Memorandum and the Final Memorandum to
register the Notes or the related Guarantees under the Securities
Act or to qualify the Indenture under the Trust Indenture
Act.
(nn) Neither the Offering nor the
Related Transactions (including, without limitation, the use of
proceeds from the sale of the Notes) will violate or result in a
violation of Section 7 of the Exchange Act or any regulation
promulgated thereunder, including, without limitation, Regulations
T, U and X of the Board of Governors of the Federal Reserve
System.
(oo) The Notes have been designated
PORTAL-eligible securities by the NASD’s PORTAL Market
(“ PORTAL ”).
(pp) There are no stamp or other
issuance or transfer taxes or duties or other similar fees or
charges required to be paid in connection with the execution and
delivery of this Agreement or the issuance or sale by the Company
of the Notes.
Each certificate signed by any
officer of the Company or the Guarantors and delivered to the
Initial Purchasers or their counsel shall be deemed to be a
representation and warranty by the Company or the Guarantors, as
the case may be, to the Initial Purchasers as to the matters
covered thereby.
2. Purchase, Sale and Delivery of
the Notes . On the basis of the representations, warranties,
agreements and covenants herein contained and subject to the terms
and conditions herein set forth, the Company agrees to issue and
sell $400,000,000 aggregate principal amount of Notes, and each of
the Initial Purchasers, severally and not jointly, agree to
purchase from the Company the principal amount of Notes set forth
opposite the name of such Initial Purchaser in Schedule I hereto at
a purchase price equal to 97.68125% of the principal amount thereof
(the “ Purchase Price ”). One or more
certificates in definitive form or global form, as instructed by
the Representative for the Notes that the Initial Purchasers have
severally agreed to purchase hereunder, and in such denomination or
denominations and registered in such name or names as the
Representative requests upon notice to the Company not later than
one full business day prior to the Closing Date (as defined below),
shall be delivered by or on behalf of the Company to the
Representative for the respective accounts of the Initial
Purchasers, with any transfer taxes payable in connection with the
transfer of the Notes to the Initial Purchasers duly paid, against
payment by or on behalf of the Initial Purchasers of the Purchase
Price therefor by wire transfer in Federal or other funds
immediately available to the account of the Company. Such delivery
of and payment for the Notes shall be made at the offices of
Shearman & Sterling LLP (“ Counsel for the Initial
Purchasers ”), 599 Lexington Avenue, New York, New York
10022 at 10:00 A.M.,
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New York City time, on December 28, 2004, or at
such other place, time or date as the Representative and the
Company may agree upon, such time and date of delivery against
payment being herein referred to as the “Closing Date.”
The Company will make such certificate or certificates for the
Notes available for examination by the Initial Purchasers at the
New York, NY offices of Counsel for the Initial Purchasers not
later than 10:00 A.M., New York City time on the business day prior
to the Closing Date.
3. Offering of the Notes and the
Initial Purchasers’ Representations and Warranties . Each
of the Initial Purchasers, severally and not jointly, represent and
warrant to and agree with the Company that:
(a) It is a qualified institutional
buyer as defined in Rule 144A under the Securities Act (a “
QIB ”).
(b) It will solicit offers for the
Notes only from, and will offer the Notes only to (A) in the case
of solicitations and offers within the United States, persons that
it reasonably believes to be QIBs or (B) in the case of
solicitations and offers outside the United States, persons other
than U.S. persons (“ foreign purchasers ,” which
term shall include dealers or other professional fiduciaries in the
United States acting on a discretionary basis for foreign
beneficial owners (other than an estate or trust)) in reliance upon
Regulation S, and such Initial Purchaser has taken or will take
reasonable steps to ensure that each purchaser of the Notes is
aware that the Notes are being offered and sold in reliance upon
the representations and warranties deemed to have been made by such
purchaser as provided in the Final Memorandum under the caption
“Notice to Investors.”
(c) It will not offer or sell the
Notes using any form of general solicitation or general advertising
(within the meaning of Regulation D) or in any manner involving a
public offering within the meaning of Section 4(2) under the
Securities Act.
(d) With respect to offers and sales
outside the United States:
(i) at or prior to the confirmation
of any sale of any Notes sold in reliance on Regulation S, it will
have sent to each distributor, dealer or other person receiving a
selling concession, fee or other remuneration that purchases Notes
from it during the distribution compliance period (as defined in
Regulation S) a confirmation or notice substantially to the
following effect:
“The Notes covered hereby have
not been registered under the U.S. Securities Act of 1933, as
amended (the “ Securities Act ”), and may not be
offered or sold within the United States or to, or for the account
or benefit of, U.S. persons, (i) as part of their distribution at
any time; or (ii) otherwise until 40 days after the later of the
commencement of the offering of the Notes and December
, 2004, except in either case in
accordance with Regulation S or Rule 144A under the Securities Act.
Terms used above have the meanings given to them by Regulation
S.”; and
(ii) such Initial Purchaser has
offered the Notes and will offer and sell the Notes (A) as part of
its distribution at any time and (B) otherwise until 40 days after
the
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later of the commencement of the
offering and the Closing Date, only in accordance with Rule 903 of
Regulation S or as otherwise permitted in Section 3(b) herein;
accordingly, such Initial Purchaser has not engaged nor will engage
in any directed selling efforts (within the meaning of Regulation
S) with respect to the Notes, and such Initial Purchaser has
complied and will comply with the offering restrictions
requirements of Regulation S.
Terms used in this Section 3(d) have the
meanings given to them by Regulation S.
4. Covenants of the Company .
The Company covenants and agrees with the Initial Purchasers
that:
(a) The Company will prepare the
Final Memorandum in the form approved by the Representative and
will not amend or supplement the Final Memorandum without first
furnishing to the Representative a copy of such proposed amendment
or supplement and will not use or file any amendment or supplement
to which the Representative may reasonably object.
(b) The Company will furnish to the
Initial Purchasers and to Counsel for the Initial Purchasers prior
to 10:00 a.m. New York City time on the business day next
succeeding the date of this Agreement and during the period
referred to in paragraph (c) below, without charge, as many copies
of the Final Memorandum and any amendments and supplements thereto
as they reasonably may request.
(c) At any time prior to the
completion of the distribution of the Notes by the Initial
Purchasers, if any event occurs or condition exists as a result of
which the Final Memorandum would include any untrue statement of a
material fact or omit to state any material fact necessary to make
the statements therein, in light of the circumstances under which
they were made, not misleading, or if it should be necessary to
amend or supplement the Final Memorandum to comply with applicable
law, the Company will promptly (i) notify the Initial Purchasers of
the same; (ii) subject to the requirements of paragraph (a) of this
Section 4, prepare and provide to the Initial Purchasers, at its
own expense, an amendment or supplement to the Final Memorandum so
that the Final Memorandum, as so amended or supplemented, will not
include an untrue statement of a material fact or omit to state a
material fact required to be stated thereon or necessary to make
the statements therein, in light of the circumstances under which
they were made, not misleading or so that the Final Memorandum, as
so amended or supplemented, will comply with applicable law; and
(iii) supply such supplemented or amended Final Memorandum to the
Initial Purchasers and Counsel for the Initial Purchasers, without
charge, in such quantities as may be reasonably
requested.
(d) The Company will (i) qualify the
Notes and the Guarantees for sale by the Initial Purchasers under
the laws of such jurisdictions as the Representative may designate
and (ii) maintain such qualifications for so long as required for
the sale of the Notes by the Initial Purchasers. The Company will
promptly advise the Initial Purchasers of the receipt by the
Company of any notification with respect to the suspension of the
qualification of the Notes for sale in any jurisdiction or the
initiation or threatening of any proceeding for such
purpose.
(e) At any time prior to the
completion of the distribution of the Notes by the Initial
Purchasers, the Company will deliver to the Initial Purchasers such
additional information
-13-
concerning the business and financial condition
of the Company as the Initial Purchasers may from time to time
request and shall, to the utmost extent practicable, notify the
Representative prior to publishing or announcing (by filing with
any regulatory authority or securities exchange or by publishing a
press release or otherwise) any information that would reasonably
be expected to be material to an investor or prospective purchaser
of the Notes. The Company will likewise notify the Initial
Purchasers of (i) any decrease in the rating of the Notes or any
other debt securities of the Company by any nationally recognized
statistical rating organization (as defined in Rule 436(g)(2) under
the Securities Act) or (ii) any notice or public announcement given
of any intended or potential decrease in any such rating or that
any such securities rating agency has under surveillance or review,
with possible negative implications, its rating of the Notes, as
soon as the Company becomes aware of any such decrease, notice or
public announcement.
(f) The Company will not, and will
not permit any of its Affiliates to, resell any of the Notes that
have been acquired by any of them, other than pursuant to an
effective registration statement under the Securities Act or in
accordance with Rule 144 under the Securities Act.
(g) Except as contemplated in the
Registration Rights Agreement, none of the Company or any of its
Affiliates, nor any person acting on its or their behalf (other
than the Initial Purchasers or any of their respective Affiliates,
as to which no statement is made) will, directly or indirectly,
make offers or sales of any security, or solicit offers to buy any
security, under circumstances or in a manner that would require the
registration of the Notes under the Securities Act.
(h) None of the Company, its
Affiliates or any person acting on its or their behalf (other than
the Initial Purchasers or any of their respective Affiliates, as to
which no statement is made) will, directly or indirectly, engage in
any general solicitation or general advertising (within the meaning
of Regulation D) or a public offering within the meaning of Section
4(2) of the Securities Act with respect to the offer and sale of
the Notes.
(i) The Company agrees that it will
not and will cause its Affiliates not to make any offer or sale of
securities of the Company of any class if, as a result of the
doctrine of “integration” referred to in Rule 502 under
the Securities Act, such offer or sale would render invalid (for
the purpose of (i) the sale of the Notes by the Company to the
Initial Purchasers, (ii) the resale of the Notes by the Initial
Purchasers to any subsequent purchasers or (iii) the resale of the
Notes by such subsequent purchasers to others) the exemption from
the registration requirements of the Securities Act provided by
Section 4 thereof or by Rule 144A or by Regulation S thereunder or
otherwise.
(j) None of the Company, its
Affiliates or any person acting on its or their behalf (other than
the Initial Purchasers or any of their respective Affiliates, as to
which no statement is made) will, directly or indirectly, engage in
any directed selling efforts (within the meaning of Regulation S)
with respect to the Notes, and each of them will comply with the
offering restrictions requirements of Regulation S.
(k) So long as any of the Notes are
“restricted securities” within the meaning of Rule
144(a)(3) under the Securities Act, at any time that the Company is
not then subject to Section 13 or 15(d) of the Exchange Act, the
Company will provide at its expense to each holder
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of the Notes and to each prospective purchaser
(as designated by such holder) of the Notes, upon the request of
such holder or prospective purchaser, any information required to
be provided by Rule 144A(d)(4) under the Securities Act. (This
covenant is intended to be for the benefit of the holders, and the
prospective purchasers designated by such holders from time to
time, of the Notes.)
(l) The Company will apply the net
proceeds from the sale of the Notes as set forth under “Use
of Proceeds” in the Final Memorandum.
(m) Unt
