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Exhibit 10.28
KINETIC CONCEPTS, INC.
$200,000,000
% Senior Subordinated Notes Due 2007
PURCHASE AGREEMENT
October 29, 1997
BT ALEX. BROWN INCORPORATED
130 Liberty Street
New York, New York 10006
BANCAMERICA ROBERTSON STEPHENS
230 South LaSalle Street
Chicago, Illinois 60697
Ladies and Gentlemen:
Kinetic Concepts, Inc., a Texas corporation (the "Company" or
"Marine Midland Bank"), and each of the Company's Subsidiaries listed on the
signature pages hereof (together with any Subsidiary that in the future executes
a supplemental indenture pursuant to which such Subsidiary agrees to guarantee
the Notes (as defined) the "Guarantors" and, together with the Company, the
"Issuers") hereby confirm their agreement with you (the "Initial Purchasers") as
set forth below.
1. The Securities. Subject to the terms and conditions herein
contained, the Company proposes to issue and sell to the Initial Purchasers
$200,000,000 aggregate principal amount of its % Senior Subordinated Notes due
2007 (the "Notes"). The Notes will be guaranteed (collectively, the
"Guarantees") on a senior basis by each of the Guarantors. The Notes and the
Guarantees are collectively referred to herein as the "Securities". The Notes
are to be issued under an indenture (the "Indenture") to be dated as of October
, 1997 by and among the Company, the Guarantors and Marine Midland Bank, as
Trustee (the "Trustee").
The Securities are being offered in connection with a leveraged
recapitalization transaction involving the Company (the "Recapitalization"),
pursuant to the Transaction Agreement dated as of October 2, 1997 (the
"Transaction Agreement"), among Fremont Purchaser II, Corp., RCBA Purchaser I,
L.P. and the Company.
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The Securities will be offered and sold to the Initial Purchasers without being
registered under the Securities Act of 1933, as amended (the "Act"), in reliance
on exemptions therefrom.
In connection with the sale of the Securities, the Issuers have
prepared a preliminary offering memorandum dated October 15, 1997 (the
"Preliminary Memorandum") and a final offering memorandum dated October , 1997
(the "Final Memorandum"; the Preliminary Memorandum and the Final Memorandum
each herein being referred to as a "Memorandum") setting forth or including a
description of the terms of the Securities, the terms of the offering of the
Securities, a description of the Company and its subsidiaries and any material
developments relating to the Company and its subsidiaries occurring after the
date of the most recent historical financial statements included therein.
The Company understands that the Initial Purchasers propose to make
an offering of the Securities only on the terms and in the manner set forth in
the Final Memorandum and Section 8 hereof as soon as the Initial Purchasers deem
advisable after this Agreement has been executed and delivered to persons in the
United States whom the Initial Purchasers reasonably believe to be qualified
institutional buyers ("Qualified Institutional Buyers" or "QIBs") as defined in
Rule 144A under the Act, as such rule may be amended from time to time ("Rule
144A"), in transactions under Rule 144A and outside the United States to certain
persons in reliance on Regulation S under the Act.
The Initial Purchasers and their direct and indirect transferees of
the Securities will be entitled to the benefits of the Registration Rights
Agreement, substantially in the form attached hereto as Exhibit A (the
"Registration Rights Agreement"), pursuant to which the Issuers have agreed,
among other things, to file a registration statement (the "Registration
Statement") with the Securities and Exchange Commission (the "Commission")
registering the Securities or the Exchange Notes (as defined in the Registration
Rights Agreement) and related guarantees under the Act.
2. Representations and Warranties. The Issuers, jointly and
severally, represent and warrant to and agree with the Initial Purchasers that:
(a) Neither the Preliminary Memorandum as of the date thereof nor
the Final Memorandum nor any amendment or sup-
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plement thereto as of the date thereof and at all times subsequent thereto up
to the Closing Date (as defined in Section 3 below) contained or contains any
untrue statement of a material fact or omitted or omits to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, except that the representations and
warranties set forth in this Section 2(a) do not apply to statements or
omissions made in reliance upon and in conformity with information relating to
the Initial Purchasers furnished to the Company in writing by the Initial
Purchasers expressly for use in the Preliminary Memorandum, the Final Memorandum
or any amendment or supplement thereto.
(b) As of the Closing Date, the Company will have the authorized,
issued and outstanding capitalization set forth in the Final Memorandum; as of
the date hereof, all of the subsidiaries of the Company are listed in Schedule 1
attached hereto (the "Subsidiaries"); all of the outstanding shares of capital
stock of the Company and the Subsidiaries have been, and as of the Closing Date
will be, duly authorized and validly issued, are fully paid and nonassessable
and were not issued in violation of any preemptive or similar rights; all of the
outstanding shares of capital stock of the Company and the Subsidiaries will be
free and clear of all liens, encumbrances, equities and claims or restrictions
on transferability (other than those imposed by the Act and the securities or
"Blue Sky" laws of certain jurisdictions) or voting; except as set forth in the
Final Memorandum, there are no (i) options, warrants or other rights to
purchase, (ii) agreements or other obligations to issue or (iii) other rights to
convert any obligation into, or exchange any securities for, shares of capital
stock of or ownership interests in the Company and the Subsidiaries outstanding.
Except for the Subsidiaries or as disclosed in the Final Memorandum, neither the
Company nor the Subsidiaries owns, directly or indirectly, a material number of
shares of capital stock or any other equity or long term debt securities or has
any equity interest in any firm, partnership, joint venture or other entity.
(c) Each of the Company and the Subsidiaries is duly incorporated,
validly existing and in good standing under the laws of its respective
jurisdiction of incorporation and has all requisite corporate power and
authority to own its properties and conduct its business as now conducted and as
described in the Final Memorandum; each of the Company and the Subsidiaries is
duly qualified to do business as a foreign corporation in good standing in all
other jurisdictions where the ownership or leasing of its properties or the
conduct of its business re-
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quires such qualification, except where the failure to be so qualified would
not, individually or in the aggregate, have a material adverse effect on the
general affairs, management, business, condition (financial or otherwise),
prospects or results of operations of the Company and the Subsidiaries, taken as
a whole (any such event, a "Material Adverse Effect").
(d) The Company has all requisite corporate power and authority to
execute, deliver and perform each of its obligations under the Notes, the
Exchange Notes and the Private Exchange Notes (as defined in the Registration
Rights Agreement). The Notes, when issued, will be in the form contemplated by
the Indenture. The Notes, the Exchange Notes and the Private Exchange Notes have
each been duly and validly authorized by the Company and, when executed by the
Company and authenticated by the Trustee in accordance with the provisions of
the Indenture and, in the case of the Notes, when delivered to and paid for by
the Initial Purchasers in accordance with the terms of this Agreement, will
constitute valid and legally binding obligations of the Company, entitled to the
benefits of the Indenture, and enforceable against the Company in accordance
with their terms, except that the enforcement thereof may be subject to (i)
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally and (ii) general
principles of equity and the discretion of the court before which any proceeding
therefor may be brought.
(e) Each Guarantor has all requisite corporate power and authority
to execute, deliver and perform each of its obligations under its Guarantee, its
guarantee of the Exchange Notes (each, an "Exchange Notes Guarantee") and its
guarantee of the Private Exchange Notes (each, "Private Exchange Notes
Guarantee"). The Guarantees, when issued, will be in the form contemplated by
the Indenture. The Guarantees, the Exchange Notes Guarantees and the Private
Exchange Notes Guarantees have each been duly and validly authorized by the
Guarantors and, in the case of the Guarantees, when delivered to and paid for by
the Initial Purchasers in accordance with the terms of this Agreement, will
constitute valid and legally binding obligations of the Guarantors, entitled to
the benefits of the Indenture, and enforceable against the Guarantors in
accordance with their terms, except that enforcement thereof may be subject to
(i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now
or hereafter in effect relating to creditors' rights generally and (ii) general
principles of equity and the discretion of the court before which any proceeding
therefor may be brought.
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(f) Each of the Issuers has all requisite corporate power and
authority to execute, deliver and perform its obligations under the Indenture.
The Indenture meets the requirements for qualification under the Trust Indenture
Act of 1939, as amended (the "TIA"). The Indenture has been duly and validly
authorized by the Issuers and, when executed and delivered by the Issuers
(assuming the due authorization, execution and delivery by the Trustee), will
constitute a valid and legally binding agreement of each of the Issuers,
enforceable against each of the Issuers in accordance with its terms, except
that the enforcement thereof may be subject to (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally and (ii) general principles of equity
and the discretion of the court before which any proceeding therefor may be
brought.
(g) Each of the Issuers has all requisite corporate power and
authority to execute, deliver and perform its obligations under the Registration
Rights Agreement. The Registration Rights Agreement has been duly and validly
authorized by each of the Issuers and, when executed and delivered by the
Issuers, will constitute a valid and legally binding agreement of each of the
Issuers, enforceable against each of the Issuers in accordance with its terms,
except that (A) the enforcement thereof may be subject to (i) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally and (ii) general principles of
equity and the discretion of the court before which any proceeding therefor may
be brought and (B) any rights to indemnity or contribution thereunder may be
limited by federal and state securities laws and public policy considerations.
(h) Each of the Issuers has all requisite corporate power and
authority to execute, deliver and perform its obligations under this Agreement
and to consummate the transactions contemplated hereby. This Agreement and the
consummation by the Issuers of the transactions contemplated hereby have been
duly and validly authorized by the Issuers. This Agreement has been duly
executed and delivered by the Issuers.
(i) No consent, approval, authorization or order of any court or
governmental agency or body, or third party is required for (i) the issuance and
sale by the Company of the Notes to the Initial Purchasers or the consummation
by the Company of the other transactions contemplated hereby, (ii) the issuance
and sale by the Guarantors of the Guarantees or the consummation by the
Guarantors of the other transactions con-
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templated hereby and (iii) the consummation by the Company of the transactions
contemplated by the Transaction Agreement and (iv) the execution by the Company
of the Credit Agreement (as defined) and the consummation by the Issuers of each
of the transactions contemplated by the Credit Agreement, except such as have
been or, prior to the Closing Date, will be obtained and such as may be required
under state securities or "Blue Sky" laws in connection with the purchase and
resale of the Securities by the Initial Purchasers. None of the Company and the
Subsidiaries is (i) in violation of its certificate of incorporation or bylaws
(or similar organizational document), (ii) in breach or violation of any
statute, law, judgment, decree, order, rule or regulation applicable to any of
them or any of their respective properties or assets, except for any such breach
or violation which would not, individually or in the aggregate, have a Material
Adverse Effect, or (iii) in breach of or default under (nor has any event
occurred which, with notice or passage of time or both, would constitute a
default under) or in violation of any of the terms or provisions of any
indenture, mortgage, deed of trust, loan agreement, note, lease, license,
franchise agreement, permit, certificate, contract or other agreement or
instrument to which any of them is a party or to which any of them or their
respective properties or assets is subject (collectively, "Contracts"), except
for any such breach, default, violation or event which would not, individually
or in the aggregate, have a Material Adverse Effect.
(j) The execution, delivery and performance by the Issuers of this
Agreement, the Indenture and the Registration Rights Agreement and the
consummation by the Issuers of the transactions contemplated hereby and thereby
(including, without limitation, the issuance and sale of the Securities to the
Initial Purchasers) and the execution, delivery and performance by the Company
of the Transaction Agreement and the execution, delivery and performance by the
Company of the Credit Agreement and the consummation by the Issuers of each of
the transactions contemplated by the Credit Agreement will not conflict with or
constitute or result in a breach of or a default under (or an event which with
notice or passage of time or both would constitute a default under) or violation
of any of (A) the terms or provisions of any Contract, except for any such
conflict, breach, violation, default or event which would not, individually or
in the aggregate, have a Material Adverse Effect, (B) the certificate of
incorporation or bylaws (or similar organizational document) of the Company or
any of the Subsidiaries or (C) (assuming compliance with all applicable state
securities or "Blue Sky" laws and assuming the accuracy of the rep-
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resentations and warranties of the Initial Purchasers in Section 8 hereof)
any statute, judgment, decree, order, rule or regulation applicable to the
Company or any of the Subsidiaries or any of their respective properties or
assets, except for any such conflict, breach or violation which would not,
individually or in the aggregate, have a Material Adverse Effect.
(k) Each of KPMG Peat Marwick LLP, who are reporting on the audited
consolidated financial statements of the Company included in the Final
Memorandum, and Ernst & Young LLP are independent public accountants within the
meaning of the Act. The consolidated financial statements of the Company and
related notes thereto included in the Final Memorandum present fairly in all
material respects the consolidated financial position of the Company and its
consolidated subsidiaries, the results of their operations and the changes in
their consolidated cash flow at the dates and for the periods specified and have
been prepared in accordance with generally accepted accounting principles
applied on a consistent basis, except as otherwise stated therein. The summary
and selected financial and statistical data in the Final Memorandum present
fairly in all material respects the information shown therein and have been
prepared and compiled on a basis consistent with the audited financial
statements included therein.
(l) The pro forma financial statements (including the notes thereto)
and the other pro forma financial information included in the Final Memorandum
(i) comply as to form in all material respects with the applicable requirements
of Regulation S-X promulgated under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), (ii) have been prepared in all material respects
in accordance with the Commission's rules and guidelines with respect to pro
forma financial statements and (iii) have been correctly computed on the bases
described therein; the assumptions used in the preparation of the pro forma
financial data and other pro forma financial information included in the Final
Memorandum are reasonable and the adjustments used therein are appropriate to
give effect to the transactions or circumstances referred to therein.
(m)There is not pending or, to the knowledge of the Issuers,
threatened any action, suit, proceeding, inquiry or investigation to which the
Company or any of the Subsidiaries is a party, or to which the property or
assets of the Company or any of the Subsidiaries are subject, before or brought
by any court, arbitrator or governmental agency or body which, if determined
adversely to the Company or any of the Subsidiaries, would, individually or in
the aggregate, have a Material Ad-
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verse Effect or which seeks to restrain, enjoin, prevent the consummation of or
otherwise challenge the issuance or sale of the Securities to be sold hereunder
or the consummation of the other transactions described in the Final Memorandum.
(n) Each of the Company and the Subsidiaries possesses all licenses,
permits, certificates, consents, orders, approvals and other authorizations
from, and has made all declarations and filings with, all federal, state, local
and other governmental authorities, all self-regulatory organizations and all
courts and other tribunals, presently required or necessary to own or lease, as
the case may be, and to operate its respective properties and to carry on its
respective businesses as now or proposed to be conducted as set forth in the
Final Memorandum ("Permits"), except where the failure to obtain such Permits
would not, individually or in the aggregate, have a Material Adverse Effect;
each of the Company and the Subsidiaries has fulfilled and performed all of its
obligations with respect to such Permits and no event has occurred which allows,
or after notice or lapse of time would allow, revocation or termination thereof
or results in any other material impairment of the rights of the holder of any
such Permit; and none of the Company or any of the Subsidiaries has received any
written or, to the knowledge of the Issuers, oral notice of any proceeding
relating to revocation or modification of any such Permit, except as described
in the Final Memorandum and except where such revocation or modification would
not, individually or in the aggregate, have a Material Adverse Effect.
(o) Neither the Company nor any of the Subsidiaries nor any of their
respective directors, officers, agents, representatives or employees (in their
capacity as directors, officers, agents, representatives or employees) has: (i)
used any funds for unlawful contributions, gifts, entertainment or other
unlawful expenses relating to political activity; (ii) directly or indirectly,
paid or delivered any fee, commission or other sum of money or item of property,
however characterized, to any finder, agent, government official or other party
or other party acting on behalf of or under the auspices of a governmental
official or governmental entity, in the United States or any other country,
which is in any manner related to the business or operations of the Company or
any of the Subsidiaries, that was illegal under any federal, state or local laws
of the United States or any other country having jurisdiction; or (iii) made any
payment to any customer or supplier of the Company or any of the Subsidiaries or
any officer, director, partner, employee or agent of any such customer or
supplier for the unlawful sharing of fees or to any such customer or supplier or
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any such officer, director, partner, employee or agent for the unlawful rebating
of charges, or engaged in any other unlawful reciprocal practice, or made any
other unlawful payment or given any other unlawful consideration to any such
customer or supplier or any such officer, director, partner, employee or agent,
in respect of the business of the Company and the Subsidiaries, except where any
such use, payment, delivery, engaging or making, singly or in the aggregate,
would not have a Material Adverse Effect.
(p) Since the date of the most recent financial statements appearing
in the Final Memorandum, except as described therein, (i) none of the Company or
any of the Subsidiaries has incurred any liabilities or obligations, direct or
contingent, or entered into or agreed to enter into any transactions or
contracts (written or oral) not in the ordinary course of business, which
liabilities, obligations, transactions or contracts would, individually or in
the aggregate, be material to the general affairs, management, business,
condition (financial or otherwise), prospects or results of operations of the
Company and the Subsidiaries, taken as a whole, (ii) except as contemplated and
permitted by the Recapitalization Agreement, none of the Company or any of the
Subsidiaries has purchased any of its outstanding capital stock, nor declared,
paid or otherwise made any dividend or distribution of any kind on its capital
stock (other than with respect to any of such Subsidiaries, the purchase of, or
dividend or distribution on, capital stock owned by the Company or a Subsidiary)
and (iii) there shall not have been any change in the capital stock or long-term
indebtedness of the Company or any of the Subsidiaries.
(q) Each of the Company and the Subsidiaries has filed all necessary
federal, state and foreign income and franchise tax returns, except where the
failure to so file such returns would not, individually or in the aggregate,
have a Material Adverse Effect, and has paid all taxes shown as due thereon; and
other than tax deficiencies which the Company or any of the Subsidiaries is
contesting in good faith and for which it has provided reserves in accordance
with generally accepted accounting principles, there is no tax deficiency that
has been asserted against the Company or any of the Subsidiaries that would
have, individually or in the aggregate, a Material Adverse Effect.
(r) The statistical and market-related data included in the Final
Memorandum are based on or derived from sources which the Issuers believe to be
reliable and accurate.
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(s) None of the Company or any of the Subsidiaries or any agent
acting on their behalf has taken or will take any action that might cause this
Agreement or the sale of the Securities to violate Regulation G, T, U or X of
the Board of Governors of the Federal Reserve System, in each case as in effect,
or as the same may hereafter be in effect, on the Closing Date.
(t) Each of the Company and the Subsidiaries has good and marketable
title to all real property and good title to all personal property described in
the Final Memorandum as being owned by it and good and marketable title to a
leasehold estate in the real and personal property described in the Final
Memorandum as being leased by it free and clear of all liens, charges,
encumbrances or restrictions, except as described in the Final Memorandum or to
the extent the failure to have such title or the existence of such liens,
charges, encumbrances or restrictions would not, individually or in the
aggregate, have a Material Adverse Effect. All leases, contracts and agreements
to which the Company or any of the Subsidiaries is a party or by which any of
them is bound are valid and enforceable against the Company or such Subsidiary,
as the case may be, and are valid and enforceable against the other party or
parties thereto and are in full force and effect with only such exceptions as
would not, individually or in the aggregate, have a Material Adverse Effect. The
Company and the Subsidiaries own or possess adequate licenses or other rights to
use all patents, trademarks, service marks, trade names, copyrights and know-how
necessary to conduct the businesses now or proposed to be operated by them as
described in the Final Memorandum, and none of the Company or any of the
Subsidiaries has received any notice of infringement of or conflict with (or
knows of any such infringement of or conflict with) asserted rights of others
with respect to any patents, trademarks, service marks, trade names, copyrights
or know-how which, if such assertion of infringement or conflict were sustained,
would have a Material Adverse Effect.
(u)There are no legal or governmental proceedings involving or
affecting the Company or any of the Subsidiaries or any of their respective
properties or assets that would be required to be described in a prospectus
pursuant to the Act that are not described in the Final Memorandum, nor are
there any material contracts or other documents that would be required to be
described in a prospectus filed in accordance with Form S-1 pursuant to the Act
that are not described in the Final Memorandum.
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(v) Except as would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect (A) each of the Company
and the Subsidiaries is in compliance with and not subject to liability under
applicable Environmental Laws (as defined below), (B) each of the Company and
the Subsidiaries has made all filings and provided all notices required under
any applicable Environmental Law, and has, and is in compliance with, all
Permits required under any applicable Environmental Laws and each of them is in
full force and effect, (C) there is no civil, criminal or administrative action,
suit, demand, claim, hearing, notice of violation, investigation, proceeding,
notice or demand letter or request for information pending or, to the knowledge
of the Issuers, threatened against the Company or any of the Subsidiaries under
any Environmental Law, (D) no lien, charge, encumbrance or restriction has been
recorded under any Environmental Law with respect to any assets, facility or
property owned, operated, leased or controlled by the Company or any of the
Subsidiaries, (E) none of the Company or any of the Subsidiaries has received
notice that it has been identified as a potentially responsible party under the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended ("CERCLA"), or any comparable state law, (F) no property or facility of
the Company or any of the Subsidiaries is (i) listed or proposed for listing on
the National Priorities List under CERCLA or is (ii) listed in the Comprehensive
Environmental Response, Compensation, Liability Information System List
promulgated pursuant to CERCLA, or on any comparable list maintained by any
state or local governmental authority.
For purposes of this Agreement, "Environmental Laws" means the
common law and all applicable federal, state and local laws or regulations,
codes, orders, decrees, judgments or injunctions issued, promulgated, approved
or entered thereunder, relating to pollution or protection of public or employee
health and safety or the environment, including, without limitation, laws
relating to (i) emissions, discharges, releases or threatened releases of
hazardous materials into the environment (including, without limitation, ambient
air, surface water, ground water, land surface or subsurface strata), (ii) the
manufacture, processing, distribution, use, generation, treatment, storage,
disposal, transport or handling of hazardous materials and (iii) underground and
above ground storage tanks and related piping, and emissions, discharges,
releases or threatened releases therefrom.
(w) There is no strike, labor dispute, slowdown or work stoppage
with the employees of the Company or any of the
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Subsidiaries which is pending or, to the knowledge of the Issuers, threatened.
(x) Each of the Company and the Subsidiaries carries insurance in
such amounts and covering such risks as is adequate for the conduct of its
business and the value of its properties.
(y) None of the Company or any of the Subsidiaries has incurred any
liability for any prohibited transaction or funding deficiency or any complete
or partial withdrawal liability with respect to any pension, profit sharing or
other plan which is subject to the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), to which the Company or any of the Subsidiaries
makes or ever has made a contribution and in which any employee of the Company
or any of the Subsidiaries is or has ever been a participant. With respect to
such plans, the Company and the Subsidiaries are in compliance in all respects
with all applicable provisions of ERISA.
(z) Each of the Company and the Subsidiaries (i) makes and keeps
accurate books and records and (ii) maintains internal accounting controls which
provide reasonable assurance that (A) transactions are executed in accordance
with management's authorization, (B) transactions are recorded as necessary to
permit preparation of its financial statements and to maintain accountability
for its assets, (C) access to its assets is permitted only in accordance with
management's authorization and (D) the reported accountability for its assets is
compared with existing assets at reasonable intervals.
(aa) None of the Company or any of the Subsidiaries is an
"investment company" or "promoter" or "principal underwriter" for an "investment
company," as such terms are defined in the Investment Company Act of 1940, as
amended, and the rules and regulations thereunder.
(bb) The Notes, the Guarantees, the Indenture, the Registration
Rights Agreement, the Credit Agreement and the Transaction Agreement will
conform in all material respects to the descriptions thereof in the Final
Memorandum.
(cc) No holder of securities of the Company or any of the
Subsidiaries will be entitled to have such securities registered under the
registration statements required to be filed by the Issuers pursuant to the
Registration Rights Agreement, other than as expressly permitted thereby.
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(dd) Immediately after the consummation of the transactions
contemplated by each of the Transaction Agreement, the Credit Agreement, this
Agreement and the Indenture, the fair value and present fair saleable value of
the assets of each of the Issuers will exceed the sum of its stated liabilities
and identified contingent liabilities; none of the Issuers is, nor will any of
the Issuers be, after giving effect to the execution, delivery and performance
of the Transaction Agreement, the Credit Agreement, this Agreement and the
Indenture, and the consummation of the transactions contemplated hereby and
thereby, (a) left with unreasonably small capital with which to carry on its
business as it is proposed to be conducted, (b) unable to pay its debts
(contingent or otherwise) as they mature or (c) otherwise insolvent.
(ee) None of the Issuers or any of their respective Affiliates (as
defined in Rule 501(b) of Regulation D under the Act) has directly, or through
any agent, (i) sold, offered for sale, solicited offers to buy or otherwise
negotiated in respect of, any "security" (as defined in the Act) which is or
could be integrated with the sale of the Securities in a manner that would
require the registration under the Act of the Securities or (ii) engaged in any
form of general solicitation or general advertising (as those terms are used in
Regulation D under the Act) in connection with the offering of the Securities or
in any manner involving a public offering within the meaning of Section 4(2) of
the Act. Assuming the accuracy of the representations and warranties of the
Initial Purchasers in Section 8 hereof, it is not necessary in connection with
the offer, sale and delivery of the Securities to the Initial Purchasers in the
manner contemplated by this Agreement to register any of the Securities under
the Act or to qualify the Indenture under the TIA.
(ff) No securities of any of the Issuers are of the same class
(within the meaning of Rule 144A under the Act) as any of the Securities and
listed on a national securities exchange registered under Section 6 of the
Exchange Act, or quoted in a U.S. automated inter-dealer quotation system.
(gg) None of the Issuers has taken, nor will any of them take,
directly or indirectly, any action designed to, or that might be reasonably
expected to, cause or result in stabilization or manipulation of the price of
the Securities.
(hh) None of the Issuers, any of their respective Affiliates or any
person acting on any of their behalf (other than the Initial Purchasers) has
engaged in any directed sell-
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ing efforts (as that term is defined in Regulation S under the Act ("Regulation
S")) with respect to the Securities; the Issuers and their respective Affiliates
and any person acting on any of their behalf (other than the Initial Purchasers)
have complied with the offering restrictions requirement of Regulation S.
Any certificate signed by any officer of any Issuer and delivered to
the Initial Purchasers or to counsel for the Initial Purchasers shall be deemed
a joint and several representation and warranty by the Issuers to the Initial
Purchasers as to the matters covered thereby.
3. Purchase, Sale and Delivery of the Securities. On the basis of
the representations, warranties, agreements and covenants herein contained and
subject to the terms and conditions herein set forth, the Issuers agree to issue
and sell to the Initial Purchasers, and each of the Initial Purchasers agrees,
acting severally and not jointly, to purchase the Securities, at % of their
principal amount, in the respective principal amounts set forth opposite their
names on Schedule I hereto.
One or more certificates in definitive form for the Notes and
Guarantees that the Initial Purchasers have agreed to purchase hereunder, and in
such denomination or denominations and registered in such name or names as the
Initial Purchasers request upon notice to the Company at least 36 hours prior to
the Closing Date, shall be delivered by or on behalf of the Issuers to the
Initial Purchasers, against payment by or on behalf of the Initial Purchasers of
the purchase price therefor by wire transfer (same day funds), net of the
overnight cost of such funds, to such account or accounts as the Company shall
specify prior to the Closing Date, or by such means as the parties hereto shall
agree prior to the Closing Date. Such delivery of and payment for the Securities
shall be made at the offices of Cahill Gordon & Reindel, 80 Pine Street, New
York, New York at 10:00 A.M., New York time, on November , 1997, or at such
other place, time or date as the Initial Purchasers, on the one hand, and the
Company, on the other hand, 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 Securities available for checking
and packaging by the Initial Purchasers at the offices of BT Alex. Brown
Incorporated in New York, New York, or at such other place as BT Alex. Brown
Incorporated may designate, at least 24 hours prior to the Closing Date.
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4. Offering by the Initial Purchasers. The Initial Purchasers
propose to make an offering of the Securities at the price and upon the terms
set forth in the Final Memorandum, as soon as practicable after this Agreement
is entered into and as in the judgment of the Initial Purchasers is advisable.
5. Covenants of the Issuers. The Issuers covenant and agree with the
Initial Purchasers that:
(a) The Issuers will not amend or supplement the Final Memorandum or
any amendment or supplement thereto of which the Initial Purchasers shall not
previously have been advised and furnished a copy for a reasonable period of
time prior to the proposed amendment or supplement and as to which the Initial
Purchasers shall not have given its consent. The Issuers will promptly, upon the
reasonable request of the Initial Purchasers or counsel for the Initial
Purchasers, make any amendments or supplements to the Preliminary Memorandum or
the Final Memorandum that may be necessary or advisable in connection with the
resale of the Securities by the Initial Purchasers.
(b) The Issuers will cooperate with the Initial Purchasers in
arranging for the qualification of the Securities for offering and sale under
the securities or "Blue Sky" laws of which jurisdictions as the Initial
Purchasers may designate and will continue such qualifications in effect for as
long as may be necessary to complete the resale of the Securities; provided,
however, that in connection therewith, none of the Issuers shall be required to
qualify as a foreign corporation or to execute a general consent to service of
process in any jurisdiction or subject itself to taxation in excess of a nominal
dollar amount in any such jurisdiction where it is not then so subject.
(c) If, at any time prior to the completion of the distribution by
the Initial Purchasers of the Securities or the Private Exchange Notes and
Private Exchange Notes Guarantees, any event occurs or information becomes known
as a result of which the Final Memorandum as then amended or supplemented would
include any untrue statement of a material fact, or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, or if for any other reason it is
necessary at any time to amend or supplement the Final Memorandum to comply with
applicable law, the Issuers will promptly notify the Initial Purchasers thereof
and will prepare, at the expense of the Issuers, an amendment or supplement to
the Final
16
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Memorandum that corrects such statement or omission or effects such compliance.
(d) The Issuers will, without charge, provide to the Initial
Purchasers and to counsel for the Initial Purchasers as many copies of the
Preliminary Memorandum and the Final Memorandum or any amendment or supplement
thereto as the Initial Purchasers may reasonably request.
(e) The Company will apply the net proceeds from the sale of the
Securities as set forth under "Use of Proceeds" in the Final Memorandum.
(f) For so long as any of the Securities remain outstanding, the
Company will furnish to the Initial Purchasers copies of all reports and other
communications (financial or otherwise) furnished by the Company to the Trustee
or to the holders of the Notes and, as soon as available, copies of any reports
or financial statements furnished to or filed by the Company with the Commission
or any national securities exchange on which any class of securities of the
Company may be listed.
(g) Prior to the Closing Date, the Company will furnish to the
Initial Purchasers, as soon as they have been prepared, a copy of any available
unaudited interim financial statements of the Company for any period subsequent
to the period covered by the most recent consolidated financial statements of
the Company appearing in the Final Memorandum.
(h) None of the Issuers or any of their Affiliates will sell, offer
for sale or solicit offers to buy or otherwise negotiate in respect of any
"security" (as defined in the Act) which could be integrated with the sale of
the Securities in a manner which would require the registration under the Act of
the Securities.
(g)The Issuers will not engage in any form of general solicitation
or general advertising (as those terms are used in Regulation D under the Act)
in connection with the offering of the Securities or in any manner involving a
public offering within the meaning of Section 4(2) of the Act.
(j) For so long as any of the Securities remain outstanding, the
Company will make available at its expense, upon request, to any holder of such
Securities and any prospective purchasers thereof the information specified in
Rule 144A(d)(4) under the Act, unless the Company is then subject to Section 13
or 15(d) of the Exchange Act.
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(k) The Company will use its best efforts to (i) permit the
Securities to be designated PORTAL securities in accordance with the rules and
regulations adopted by the NASD relating to trading in the Private Offerings,
Resales and Trading through Automated Linkages market (the "PORTAL Market") and
(ii) permit the Securities to be eligible for clearance and settlement through
The Depository Trust Company.
(l) In connection with Securities offered and sold in an off-shore
transaction (as defined in Regulation S) the Company will not register any
transfer of such Notes not made in accordance with the provisions of Regulation
S and will not, except in accordance with the provisions of Regulation S, if
applicable, issue any such Notes in the form of definitive securities.
6. Expenses. The Issuers jointly and severally agree to pay all
costs and expenses incident to the performance of their respective obligations
under this Agreement, whether or not the transactions contemplated herein are
consummated or this Agreement is terminated pursuant to Section 11 hereof,
including all costs and expenses incident to (i) the printing, word processing
or other production of documents with respect to the transactions contemplated
hereby, including any costs of printing the Preliminary Memorandum and the Final
Memorandum and any amendment or supplement thereto, and any "Blue Sky"
memoranda, (ii) all arrangements relating to the delivery to the Initial
Purchasers of copies of the foregoing documents, (iii) the fees and
disbursements of the counsel, the accountants and any other experts or advisors
retained by the Issuers, (iv) preparation (including printing), issuance and
delivery to the Initial Purchasers of the Securities, (v) the qualification of
the Securities under state securities and "Blue Sky" laws, including filing fees
and fees and disbursements of counsel for the Initial Purchasers relating
thereto, (vi) expenses in connection with any meetings with prospective
investors in the Securities, (vii) fees and expenses of the Trustee including
fees and expenses of its counsel, (viii) all expenses and listing fees incurred
in connection with the application for quotation of the Securities on the PORTAL
Market and (ix) any fees charged by investment rating agencies for the rating of
the Securities. If the sale of the Securities provided for herein is not
consummated because any condition to the obligations of the Initial Purchasers
set forth in Section 7 hereof is not satisfied, because this Agreement is
terminated or because of any failure, refusal or inability on the part of the
Issuers to perform all obligations and satisfy all conditions on their part to
be performed or satisfied hereunder (other than solely
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by reason of a default by the Initial Purchasers of its obligations hereunder
after all conditions hereunder have been satisfied in accordance herewith), the
Issuers jointly and severally agree to promptly reimburse the Initial Purchasers
upon demand for all out-of-pocket expenses (including fees, disbursements and
charges of Cahill Gordon & Reindel, counsel for the Initial Purchasers) that
shall have been incurred by the Initial Purchasers in connection with the
proposed purchase and sale of the Securities.
7. Conditions of the Initial Purchasers' Obligations. The obligation
of the Initial Purchasers to purchase and pay for the Notes shall, in its sole
discretion, be subject to the satisfaction or waiver of the following conditions
on or prior to the Closing Date:
(a) On the Closing Date, the Initial Purchasers shall have received
the opinion, dated as of the Closing Date and addressed to the Initial
Purchasers, of [Shearman & Sterling or Cox & Smith Incorporated], counsel for
the Issuers, in form and substance satisfactory to counsel for the Initial
Purchasers, to the effect that:
(i) Each of the Company and the Subsidiaries is duly incorporated,
validly existing and in good standing under the laws of its respective
jurisdiction of incorporation and has all requisite corporate power and
authority to own its properties and to conduct its business as described
in the Final Memorandum. Each of the Company and the Subsidiaries is duly
qualified to do business as a foreign corporation in good standing in all
other jurisdictions where the ownership or leasing of its properties or
the conduct of its business requires such qualification, except where the
failure to be so qualified would not, individually or in the aggregate,
have a Material Adverse Effect.
(ii) The Company has the authorized, issued and outstanding
capitalization set forth in the Final Memorandum; all of the outstanding
shares of capital stock of the Company and the Subsidiaries have been duly
authorized and validly issued, are fully paid and nonassessable and were
not issued in violation of any preemptive or similar rights; all of the
outstanding shares of capital stock of the Subsidiaries are owned,
directly or indirectly, by the Company, free and clear of all perfected
security interests and, to the knowledge of such counsel, free and clear
of all other liens, encumbrances, equities and claims or
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restrictions on transferability (other than those imposed by the Act and
the securities or "Blue Sky" laws of certain jurisdictions) or voting.
(iii) Except as set forth in the Final Memorandum (A) no options,
warrants or other rights to purchase from the Company or any of the
Subsidiaries shares of capital stock or ownership interests in the Company
or any of the Subsidiaries are outstanding, (B) no agreements or other
obligations to issue, or other rights to convert, any obligation into, or
exchange any securities for, shares of capital stock or ownership
interests in the Company or any of the Subsidiaries are outstanding and
(C) no holder of securities of the Company or any of the Subsidiaries is
entitled to have such securities registered under a registration statement
filed pursuant to the Registration Rights Agreement.
(iv) The Company has all requisite corporate power and authority to
execute, deliver and perform each of its obligations under the Indenture,
the Notes, the Exchange Notes and the Private Exchange Notes; each
Guarantor has all requisite corporate power and authority to execute,
deliver and perform each of its obligations under the Indenture, its
Guarantees, its Exchange Notes Guarantees and its Private Exchange Notes
Guarantees; the Indenture meets the requirements for qualification under
the TIA; the Indenture has been duly and validly authorized by each of the
Issuers and, when duly executed and delivered by each of the Issuers
(assuming the due authorization, execution and delivery thereof by the
Trustee), will constitute the valid and legally binding agreement of each
of the Issuers, enforceable against each of the Issuers in
accordance with its terms, except that the enforcement thereof may be
subject to (i) bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
generally and (ii) general principles of equity and the discretion of the
court before which any proceeding therefor may be brought.
(v) The Notes are in the form contemplated by the Indenture. The Notes
have each been duly and validly authorized by the Company and, when duly
executed and delivered by the Company and paid for by the Initial
Purchasers in accordance with the terms of this Agreement (assuming the
due authorization, execution and delivery of the Indenture by the Trustee
and due authentication and
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delivery of the Notes by the Trustee in accordance with the Indenture),
will constitute the valid and legally binding obligations of the Company,
entitled to the benefits of the Indenture, and enforceable against the
Company in accordance with their terms, except that the enforcement
thereof may be subject to (i) bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally and (ii) general principles of equity and the
discretion of the court before which any proceeding therefor may be
brought.
(vi) The Guarantees are in the form contemplated by the Indenture. The
Guarantees have each been duly and validly authorized by the Guarantors
and, when duly executed and delivered by the Guarantors in accordance with
terms of this Agreement (assuming the due authorization, execution and
delivery of the Indenture by the Trustee), will constitute the valid and
legally binding obligations of the Guarantors, enforceable against the
Guarantors in accordance with their terms, except that the enforcement
thereof may be subject to (i) bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally and (ii) general principles of equity and the
discretion of the court before which any proceeding therefor may be
brought.
(vii) The Exchange Notes and the Private Exchange Notes have been duly and
validly authorized by the Company, and when the Exchange Notes and the
Private Exchange Notes have been duly executed and delivered by the
Company in accordance with the terms of the Registration Rights Agreement
and the Indenture (assuming the due authorization, execution and delivery
of the Indenture by the Trustee and due authentication and delivery of the
Exchange Notes and the Private Exchange Notes by the Trustee in accordance
with the Indenture), will constitute the valid and legally binding
obligations of the Company, entitled to the benefits of the Indenture, and
enforceable against the Company in accordance with their terms, except
that the enforcement thereof may be subject to (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally and (ii) general principles
of equity and the discretion of the court before which any proceeding
therefor may be brought.
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(viii) The Exchange Notes Guarantees and the Private Exchange Notes
Guarantees have been duly and validly authorized by the Guarantors, and
when the Exchange Notes Guarantees and the Private Exchange Notes
Guarantees have been duly executed and delivered by the Guarantors in
accordance with the terms of the Registration Rights Agreement and the
Indenture (assuming due authorization, execution and delivery of the
Indenture by the Trustee), will constitute the valid and legally binding
obligations of the Guarantors, and enforceable against the Guarantors in
accordance with their terms, except that the enforcement thereof may be
subject to (i) bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
generally and (ii) general principles of equity and the discretion of the
court before which any proceeding therefor may be brought.
(ix) Each of the Issuers has all requisite corporate power and authority
to execute, deliver and perform its obligations under the Registration
Rights Agreement; the Registration Rights Agreement has been duly and
validly authorized by each of the Issuers and, when duly executed and
delivered by each of the Issuers (assuming due authorization, execution
and delivery thereof by the Initial Purchasers), will constitute the valid
and legally binding agreement of each of the Issuers, enforceable against
each of the Issuers in accordance with its terms, except that (A) the
enforcement thereof may be subject to (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally and (ii) general principles
of equity and the discretion of the court before which any proceeding
therefor may be brought and (B) any rights to indemnity or contribution
thereunder may be limited by federal and state securities laws and public
policy considerations.
(x) Each of the Issuers has all requisite corporate power and authority
to execute, deliver and perform its obligations under this Agreement and
to consummate the transactions contemplated hereby; this Agreement and the
consummation by each of the Issuers of the transactions contemplated
hereby have been duly and validly authorized by each of the Issuers. This
Agreement has been duly executed and delivered by each of the Issuers.
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(xi) The Indenture, the Notes, the Guarantees, the Registration Rights
Agreement, the Credit Agreement and the Transaction Agreement conform in
all material respects to the descriptions thereof contained in the Final
Memorandum.
(xii) The descriptions contained and summarized in the Final Memorandum
of contracts and other documents are accurate; and the statements set
forth under the headings "Risk Factors," "The Transactions," "Business,"
"Description of Notes" and "Certain Relationships and Related
Transactions" in the Final Memorandum, insofar as such statements
constitute a summary of legal matters, documents, proceedings or
conclusions of law referred to therein, provide an accurate summary of
such legal matters, documents, proceedings and conclusions.
(xiii) No legal or governmental proceedings are pending or, to the
knowledge of such counsel, threatened to which the Company or any of the
Subsidiaries is a party or to which any of their respective properties or
assets is subject which, if determined adversely to the Company or the
Subsidiaries, would result, individually or in the aggregate, in a
Material Adverse Effect, or which seeks to restrain, enjoin, prevent the
consummation of or otherwise challenge the issuance or sale of the
Securities to be sold hereunder or the consummation of the other
transactions described in the Final Memorandum under the caption "Use of
Proceeds."
(xiv) The execution, delivery and performance by the Issuers of this
Agreement, the Indenture and the Registration Rights Agreement and the
consummation of the transactions contemplated hereby and thereby
(including, without limitation, the issuance and sale of the Securities to
the Initial Purchasers), the execution, delivery and performance by the
Company of the Transaction Agreement, and the execution, delivery and
performance by the Company of the Credit Agreement and the consummation by
the Issuers of each of the transactions contemplated by the Credit
Agreement will not conflict with or constitute or result in a breach or a
default under (or an event which with notice or passage of time or both
would constitute a default under) or violation of any of (i) the terms or
provisions of any Contract known to such counsel (including in any event
any of the foregoing which have been filed by the Company with the
Commission), except for any such conflict, breach, violation, default or
event which would not, indi-
23
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vidually or in the aggregate, have a Material Adverse Effect, (ii) the
certificate of incorporation or bylaws (or similar organizational
document) of the Company or any of the Subsidiaries, or (iii) (assuming
compliance with all applicable state securities or "Blue Sky" laws and
assuming the accuracy of the representations and warranties, of the
Initial Purchasers in Section 8 hereof) any statute, law, judgment,
decree, order, rule or regulation known to such counsel to be applicable
to the Company or any of the Subsidiaries or any of their respective
properties or assets, except for any such conflict, breach or violation
which would not, individually or in the aggregate, have a Material Adverse
Effect.
(xv) None of the Company or any of the Subsidiaries is (i) in violation of
its certificate of incorporation or bylaws (or similar organizational
document), (ii) to the knowledge of such counsel, in breach or violation
of any statute, law, judgment, decree, order, rule or regulation
applicable to any of them or any of their respective properties or assets,
except for any such breach or violation which would not, individually or
in the aggregate, have a Material Adverse Effect, or (iii) in breach or
default under (nor has any event occurred which, with notice or passage of
time or both, would constitute a default under) or in violation of any of
the terms or provisions of any Contract known to such counsel (including
in any event any of the foregoing which have been filed by the Company
with the Commission), except for any such breach, default, violation or
event which would not, individually or in the aggregate, have a Material
Adverse Effect.
(xvi) The Company and the Subsidiaries have obtained all Permits necessary
to conduct the businesses now or proposed to be conducted by them as
described in the Final Memorandum, the lack of which would, individually
or in the aggregate, have a Material Adverse Effect; each of the Company
and the Subsidiaries has fulfilled and performed all of its obligations
with respect to such Permits and no event has occurred which allows, or
after notice or lapse of time would allow, revocation or termination
thereof or results in any other material impairment of the rights of the
holder of any such Permit.
(xvii) To the best of such counsel's knowledge, the Company and the
Subsidiaries own or possess adequate licenses or other rights to use all
patents, trademarks, service marks, trade names, copyrights and know-how
neces-
24
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sary to conduct the businesses now or proposed to be operated by them as
described in the Final Memorandum, and none of the Company or any of the
Subsidiaries has received any notice of infringement of or conflict with
asserted rights of others with respect to any patents, trademarks, service
marks, trade names, copyrights or know-how which, if such assertion of
infringement or conflict were sustained, would have a Material Adverse
Effect.
(xviii) No consent, approval, authorization or order of any governmental
authority is required for (i) the issuance and sale by the Company of the
Notes to the Initial Purchasers or the consummation by the Company of the
other transactions contemplated hereby and (ii) the execution and delivery
by the Guarantors of the Guarantees or the consummation by the Guarantors
of the other transactions contemplated hereby and (iii) the consummation
by the Company of the transactions contemplated by the Transaction
Agreement and except such as may be required under Blue Sky laws, as to
which such counsel need express no opinion, and those which have
previously been obtained.
(xix) To the knowledge of such counsel, there are no legal or governmental
proceedings involving or affecting the Company or any of the Subsidiaries
or any of their respective properties or assets which would be required to
be described in a prospectus pursuant to the Act that are not described in
the Final Memorandum, nor are there any material contracts or other
documents which would be required to be described in a prospectus pursuant
to the Act that are not described in the Final Memorandum.
(xx) None of the Company or any of the Subsidiaries is, or immediately
after the sale of the Securities to be sold hereunder and the application
of the proceeds from such sale (as described in the Final Memorandum under
the caption "Use of Proceeds") will be, an "investment company" as such
term is defined in the Investment Company Act of 1940, as amended.
(xxi) No registration under the Act of the Securities is required in
connection with the sale of the Securities to the Initial Purchasers as
contemplated by this Agreement and the Final Memorandum or in connection
with the initial resale of the Securities by the Initial Purchasers in
accordance with Section 8 of this Agreement, and prior to the commencement
of the Exchange Offer (as defined in
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the Registration Rights Agreement) or the effectiveness of the Shelf
Registration Statement (as defined in the Registration Rights Agreement),
the Indenture is not required to be qualified under the TIA, in each case
assuming (i) (A) that the purchasers who buy such Securities in the
initial resale thereof are qualified institutional buyers as defined in
Rule 144A promulgated under the Act ("QIBs") or (B) that the offer or sale
of the Securities is made in an offshore transaction as defined in
Regulation S promulgated under the Act (ii) the accuracy of the Initial
Purchasers' representations in Section 8 hereof and those of the Issuers
contained in this Agreement regarding the absence of a general
solicitation in connection with the sale of such Securities to the Initial
Purchasers and the initial resale thereof and (iii) the due performance by
the Initial Purchasers of the agreements set forth in Section 8 hereof.
(xxii) Neither the consummation of the transactions contemplated by this
Agreement nor the sale, issuance, execution or delivery of the Securities
will violate Regulation G, T, U or X of the Board of Governors of the
Federal Reserve System.
At the time the foregoing opinion is delivered, [Shearman & Sterling
or Cox & Smith Incorporated] shall additionally state that it has participated
in conferences with officers and other representatives of the Issuers,
representatives of the independent public accountants for the Issuers,
representatives of the Initial Purchasers and counsel for the Initial
Purchasers, at which conferences the contents of the Final Memorandum and
related matters were discussed, and, although it has not independently verified
and is not passing upon and assumes no responsibility for the accuracy,
completeness or fairness of the statements contained in the Final Memorandum
(except to the extent specified in subsections 7(a)(xi) and 7(a)(xii)), no facts
have come to its attention which lead it to believe that the Final Memorandum,
on the date thereof or at the Closing Date, contained an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements contained therein, in light of the
circumstances under which they were made, not misleading (it being understood
that such firm need not express any opinion with respect to the financial
statements and related notes thereto and the other financial, statistical and
accounting data included in the Final Memorandum). The opinion of [Shearman &
Sterling or Cox & Smith Incorporated] described in this Section shall be
rendered to the Ini-
26
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tial Purchasers at the request of the Company and shall so state therein.
In rendering the foregoing opinions, [Shearman & Sterling or Cox &
Smith Incorporated] may (i) state that their opinion is limited to matters
governed by the federal laws of the United States of America, the laws of the
States of New York and Texas and the corporate laws of the State of Delaware,
and (ii) rely, to the extent such counsel deems proper, upon the representations
set forth herein and on certificates of public officials and officers of the
Company, with respect to the accuracy of factual matters contained therein which
were not independently established.
References to the Final Memorandum in this subsection (a) shall
include any amendment or supplement thereto prepared in accordance with the
provisions of this Agreement at the Closing Date.
(b) On the Closing Date, the Initial Purchasers shall have received
the opinion, in form and substance satisfactory to the Initial Purchasers, dated
as of the Closing Date and addressed to the Initial Purchasers, of Cahill Gordon
& Reindel, counsel for the Initial Purchasers, with respect to certain legal
matters relating to this Agreement and such other related matters as the Initial
Purchasers may reasonably require. In rendering such opinion, Cahill Gordon &
Reindel shall have received and may rely upon such certificates and other
documents and information as it may reasonably request to pass upon such
matters.
(c) The Initial Purchasers shall have received from each of KPMG
Peat Marwick LLP and Ernst & Young LLP a comfort letter or letters dated the
date hereof and the Closing Date, in form and substance satisfactory to counsel
for the Initial Purchasers.
(d) The representations and warranties of the Issuers contained in
this Agreement shall be true and correct on and as of the date hereof and on and
as of the Closing Date as if made on and as of the Closing Date; the statements
of the Issuers' officers made pursuant to any certificate delivered in
accordance with the provisions hereof shall be true and correct in all material
respects on and as of the date made and on and as of the Closing Date; the
Issuers shall have performed all covenants and agreements and satisfied all
conditions on their part to be performed or satisfied hereunder at or prior to
the Closing Date; and, except as described in the Final Memorandum
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(exclusive of any amendment or supplement thereto after the date hereof),
subsequent to the date of the most recent financial statements in such Final
Memorandum, there shall have been no event or development, and no information
shall have become known, that, individually or in the aggregate, has or would be
reasonably likely to have a Material Adverse Effect.
(e) The sale of the Securities hereunder shall not be enjoined
(temporarily or permanently) on the Closing Date.
(f) Subsequent to the date of the most recent financial statements
in the Final Memorandum (exclusive of any amendment or supplement thereto after
the date hereof), none of the Company or any of the Subsidiaries shall have
sustained any loss or interference with respect to its business or properties
from fire, flood, hurricane, accident or other calamity, whether or not covered
by insurance, or from any strike, labor dispute, slow down or work stoppage or
from any legal or governmental proceeding, order or decree, which loss or
interference, individually or in the aggregate, has or would be reasonably
likely to have a Material Adverse Effect.
(g) The Initial Purchasers shall have received a certificate of each
of the Issuers, dated the Closing Date, signed on behalf of each of the Issuers
by its Chairman of the Board, President or any Senior Vice President and the
Chief Financial Officer, to the effect that:
(i) The representations and warranties of the Issuers contained in this
Agreement are true and correct on and as of the date hereof and on and as
of the Closing Date, and the Issuers have performed all covenants and
agreements and satisfied all conditions on their part to be performed or
satisfied hereunder at or prior to the Closing Date;
(ii) At the Closing Date, since the date hereof or since the date of the
most recent financial statements in the Final Memorandum (exclusive of any
amendment or supplement thereto after the date hereof), no event or
development has occurred, and no information has become known, that,
individually or in the aggregate, has or would be reasonably likely to
have a Material Adverse Effect; and
(iii) The sale of the Securities hereunder has not been enjoined
(temporarily or permanently).
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(h) On the Closing Date, the Initial Purchasers shall have received
the Registration Rights Agreement executed by each of the Issuers and such
agreement shall be in full force and effect at all times from and after the
Closing Date.
(i) The Indenture shall have been duly executed and delivered by the
Company and the Trustee, and the Notes and the Guarantees shall have been duly
executed by the Company and the Guarantors, respectively, and the Notes shall
have been duly authenticated by the Trustee;
(j) The Initial Purchasers shall have received a true and correct
copy of the Transaction Agreement and any amendments thereto, and there shall
have been no material amendments, alterations, modifications or waivers of any
provisions of the Transaction Agreement since the date of this Agreement; all
conditions to effect the Offer and the Stock Purchase (as such terms are defined
in the Transaction Agreement) shall have been satisfied without waiver.
(k) The Initial Purchasers shall have received a true and correct
copy of the Credit Agreement, dated as of the Closing Date (the "Credit
Agreement"), among the Company, Bank of America National Trust and Savings
Association, as Administrative Agent, Bank of America International Limited, as
European Payment Agent, Bankers Trust Company, as Syndication Agent, and the
other institutions party thereto.
On or before the Closing Date, the Initial Purchasers and counsel
for the Initial Purchasers shall have received such further documents, opinions,
certificates, letters and schedules or instruments relating to the business,
corporate, legal and financial affairs of the Company and the Subsidiaries as
they shall have heretofore reasonably requested.
All such documents, opinions, certificates, letters, schedules or
instruments delivered pursuant to this Agreement will comply with the provisions
hereof only if they are reasonably satisfactory in all material respects to the
Initial Purchasers and counsel for the Initial Purchasers. The Company shall
furnish to the Initial Purchasers such conformed copies of such documents,
opinions, certificates, letters, schedules and instruments in such quantities as
the Initial Purchasers shall reasonably request.
8. Offering of Securities; Restrictions on Transfer. (a) Each of the
Initial Purchasers represents and warrants (as to itself only) that it is a QIB.
Each of the Initial Purchas-
29
-29-
ers agrees with the Issuers (as to itself only) that (i) it has not and will not
solicit offers for, or offer or sell, the Securities by any form of general
solicitation or general advertising (as those terms are used in Regulation D
under the Act) or in any manner involving a public offering within the meaning
of Section 4(2) of the Act; and (ii) it has and will solicit offers for the
Securities only from, and will offer the Securities only to (A) in the case of
offers inside the United States, persons whom such Initial Purchaser reasonably
believes to be QIBs or, if any such person is buying for one or more
institutional accounts for which such person is acting as fiduciary or agent,
only when such person has represented to such Initial Purchaser that each such
account is a QIB, to whom notice has been given that such sale or delivery is
being made in reliance on Rule 144A, and, in each case, in transactions under
Rule 144A and (B) in the case of offers outside the United States, to persons
other than U.S. persons ("foreign purchasers," which term shall include dealers
or other professional fiduciaries in the United States acting on a discretionary
basis for foreign beneficial owners (other than an estate or trust)); provided,
however, that, in the case of this clause (B), in purchasing such Securities
such persons are deemed to have represented and agreed as provided under the
caption "Transfer Restrictions" contained in the Final Memorandum (or, if the
Final Memorandum is not in existence, in the most recent Memorandum).
(b) Each of the Initial Purchasers represents and warrants (as to itself
only) with respect to offers and sales outside the United States that (i) it has
and will comply with all applicable laws and regulations in each jurisdiction in
which it acquires, offers, sells or delivers Securities or has in its possession
or distributes any Memorandum or any such other material, in all cases at its
own expense; (ii) the Securities have not been and will not be offered or sold
within the United States or to, or for the account or benefit of, U.S. persons
except in accordance with Regulation S under the Act or pursuant to an exemption
from the registration requirements of the Act; (iii) it has offered the
Securities and will offer and sell the Securities (A) as part of its
distribution at any time and (B) otherwise until 40 days after the later of the
commencement of the offering and the Closing Date, only in accordance with Rule
903 of Regulation S and, accordingly, neither it nor any persons acting on its
behalf have engaged or will engage in any directed selling efforts (within the
meaning of Regulation S) with respect to the Securities, and any such persons
have complied and will comply with the offering restrictions requirement of
Regulation S; and (iv) it agrees that, at
30
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or prior to confirmation of sales of the Securities, it will have sent to each
distributor, dealer or person receiving a selling concession, fee or other
remuneration that purchases Securities from it during the restricted period a
confirmation or notice to substantially the following effect:
"The Securities covered hereby have not been registered under the United
States Securities Act of 1933 (the "Securities Act") and may not be
offered and sold within the United States or to, or for the account or
benefit of, U.S. persons (i) as part of the distribution of the Securities
at any time or (ii) otherwise until 40 days after the later of the
commencement of the offering and the closing date of the offering, except
in either case in accordance with Regulation S (or Rule 144A if available)
under the Securities Act. Terms used above have the meaning given to them
in Regulation S."
Terms used in this Section 8(b) and not defined in this Agreement have the
meanings given to them in Regulation S.
9. Indemnification and Contribution. (a) The Issuers jointly and
severally agree to indemnify and hold harmless the Initial Purchasers and the
affiliates, directors, officers, agents, representatives and employees of any
Initial Purchaser or their affiliates, and each other person, if any, who
controls the Initial Purchasers within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, against any losses, claims, damages or
liabilities to which any Initial Purchaser or such other person may become
subject under the Act, the Exchange Act or otherwise, insofar as any such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon:
(i) any untrue statement or alleged untrue statement of any material fact
contained in any Memorandum or any amendment or supplement thereto or any
application or other document, or any amendment or supplement thereto,
executed by an Issuer or based upon written information furnished by or on
behalf of an Issuer filed in any jurisdiction in order to qualify the
Securities under the securities or "Blue Sky" laws thereof or filed with
any securities association or securities exchange (each an "Application");
or
(ii) the omission or alleged omission to state, in any Memorandum or any
amendment or supplement thereto or any Application, a material fact
required to be stated
31
-31-
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading,
and will reimburse, as incurred, the Initial Purchasers and each such other
person for any legal or other expenses incurred by the Initial Purchasers or
such other person in connection with investigating, defending against or
appearing as a third-party witness in connection with any such loss, claim,
damage, liability or action; provided, however, the Issuers will not be liable
in any such case to the extent that any such loss, claim, damage, or liability
arises out of or is based upon any untrue statement or alleged untrue statement
or omission or alleged omission made in any Memorandum or any amendment or
supplement thereto or any Application in reliance upon and in conformity with
written information concerning the Initial Purchasers furnished to an Issuer by
the Initial Purchasers specifically for use therein. This indemnity agreement
will be in addition to any liability that the Issuers may otherwise have to the
indemnified parties. The Issuers shall not be liable under this Section 9 for
any settlement of any claim or action effected without their prior written
consent, which shall not be unreasonably withheld.
(b) The Initial Purchasers agree, severally and not jointly, to
indemnify and hold harmless the Issuers, their respective directors, their
respective officers and each person, if any, who controls an Issuer within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act against any
losses, claims, damages or liabilities to which an Issuer or any such director,
officer or controlling person may become subject under the Act, the Exchange Act
or otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon (i) any untrue statement or
alleged untrue statement of any material fact contained in any Memorandum or any
amendment or supplement thereto or any Application, or (ii) the omission or the
alleged omission to state therein a material fact required to be stated in any
Memorandum or any amendment or supplement thereto or any Application, or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information concerning such Initial Purchaser, furnished
to an Issuer by such Initial Purchaser specifically for use therein; and subject
to the limitation set forth immediately preceding this clause, will reimburse,
as incurred, any reasonable legal or other expenses incurred by an
32
-32-
Issuer or any such director, officer or controlling person in connection with
investigating or defending against or appearing as a third party witness in
connection with any such loss, claim, damage, liability or action in respect
thereof. This indemnity agreement will be in addition to any liability that the
Initial Purchasers may otherwise have to the indemnified parties. The Initial
Purchasers shall not be liable under this Section 9 for any settlement of any
claim or action effected without its consent, which shall not be unreasonably
withheld. The Issuers shall not, without the prior written consent of the
Initial Purchasers, effect any settlement or compromise of any pending or
threatened proceeding in respect of which any Initial Purchaser is or could have
been a party, or indemnity could have been sought hereunder by the Initial
Purchasers, unless such settlement (A) includes an unconditional written release
of the Initial Purchasers, in form and substance reasonably satisfactory to the
Initial Purchasers, from all liability on claims that are the subject matter of
such proceeding and (B) does not include any statement as to an admission of
fault, culpability or failure to act by or on behalf of the Initial Purchasers.
(c) Promptly after receipt by an indemnified party under this
Section 9 of notice of the commencement of any action for which such indemnified
party is entitled to indemnification under this Section 9, such indemnified
party will, if a claim in respect thereof is to be made against the indemnifying
party under this Section 9, notify the indemnifying party of the commencement
thereof in writing; but the omission to so notify the indemnifying party (i)
will not relieve it from any liability under paragraph (a) or (b) above unless
and to the extent such failure results in the forfeiture by the indemnifying
party of substantial rights and defenses and (ii) will not, in any event,
relieve the indemnifying party from any obligations to any indemnified party
other than the indemnification obligation provided in paragraphs (a) and (b)
above. In case any such action is brought against any indemnified party, and it
notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein and, to the extent that it may
wish, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel reasonably satisfactory to such indemnified
party; provided, however, that if (i) the use of counsel chosen by the
indemnifying party to represent the indemnified party would present such counsel
with a conflict of interest, (ii) the defendants in any such action include both
the indemnified party and the indemnifying party and the indemnified party shall
have been advised by counsel that there may be one
33
-33-
or more legal defenses available to it and/or other indemnified parties that are
different from or additional to those available to the indemnifying party, or
(iii) the indemnifying party shall not have employed counsel reasonably
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after receipt by the indemnifying party of notice of the
institution of such action, then, in each such case, the indemnifying party
shall not have the right to direct the defense of such action on behalf of such
indemnified party or parties and such indemnified party or parties shall have
the right to select separate counsel to defend such action on behalf of such
indemnified party or parties. After notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof and approval
by such indemnified party of counsel appointed to defend such action, the
indemnifying party will not be liable to such indemnified party under this
Section 9 for any legal or other expenses, other than reasonable costs of
investigation, subsequently incurred by such indemnified party in connection
with the defense thereof, unless (i) the indemnified party shall have employed
separate counsel in accordance with the proviso to the immediately preceding
sentence (it being understood, however, that in connection with such action the
indemnifying party shall not be liable for the expenses of more than one
separate counsel (in addition to local counsel) in any one action or separate
but substantially similar actions in the same jurisdiction arising out of the
same general allegations or circumstances, designated by BT Alex. Brown
Incorporated in the case of paragraph (a) of this Section 9 or the Company in
the case of paragraph (b) of this Section 9, representing the indemnified
parties under such paragraph (a) or paragraph (b), as the case may be, who are
parties to such action or actions) or (ii) the indemnifying party has authorized
in writing the employment of counsel for the indemnified party at the expense of
the indemnifying party. After such notice from the indemnifying party to such
indemnified party, the indemnifying party will not be liable for the costs and
expenses of any settlement of such action effected by such indemnified party
without the prior written consent of the indemnifying party (which consent shall
not be unreasonably withheld), unless such indemnified party waived in writing
its rights under this Section 9, in which case the indemnified party may effect
such a settlement without such consent.
(d) In circumstances in which the indemnity agreement provided for
in the preceding paragraphs of this Section 9 is unavailable to, or insufficient
to hold harmless, an indemnified party in respect of any losses, claims, damages
or li-
34
-34-
abilities (or actions in respect thereof), each indemnifying party, in order to
provide for just and equitable contribution, shall contribute to the amount paid
or payable by such indemnified party as a result of such losses, claims, damages
or liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect (i) the relative benefits received by the indemnifying
party or parties on the one hand and the indemnified party on the other from the
offering of the Securities or (ii) if the allocation provided by the foregoing
clause (i) is not permitted by applicable law, not only such relative benefits
but also the relative fault of the indemnifying party or parties on the one hand
and the indemnified party on the other in connection with the statements or
omissions or alleged statements or omissions that resulted in such losses,
claims, damages or liabilities (or actions in respect thereof). The relative
benefits received by the Issuers on the one hand and any Initial Purchaser on
the other shall be deemed to be in the same proportion as the total proceeds
from the offering (before deducting expenses) received by the Issuers bear to
the total discounts and commissions received by such Initial Purchaser. The
relative fault of the parties shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Issuers on the one hand, or such Initial Purchaser on the other,
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission or alleged statement or
omission, and any other equitable considerations appropriate in the
circumstances. The Issuers and the Initial Purchasers agree that it would not be
equitable if the amount of such contribution were determined by pro rata or per
capita allocation or by any other method of allocation that does not take into
account the equitable considerations referred to in the first sentence of this
paragraph (d). Notwithstanding any other provision of this paragraph (d), no
Initial Purchaser shall be obligated to make contributions hereunder that in the
aggregate exceed the total discounts, commissions and other compensation
received by such Initial Purchaser under this Agreement, less the aggregate
amount of any damages that such Initial Purchaser has otherwise been required to
pay by reason of the untrue or alleged untrue statements or the omissions or
alleged omissions to state a material fact, and no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this paragraph (d), each person, if any, who
controls an Initial Purchaser within the meaning of Section 15 of the Act or
Sec-
35
-35-
tion 20 of the Exchange Act shall have the same rights to contribution as the
Initial Purchasers, and each director of an Issuer, each officer of an Issuer
and each person, if any, who controls an Issuer within the meaning of Section 15
of the Act or Section 20 of the Exchange Act, shall have the same rights to
contribution as the Issuers.
10. Survival Clause. The respective representations, warranties,
agreements, covenants, indemnities and other statements of the Issuers, their
respective officers and the Initial Purchasers set forth in this Agreement or
made by or on behalf of them pursuant to this Agreement shall remain in full
force and effect, regardless of (i) any investigation made by or on behalf of
the Issuers, any of their respective officers or directors, the Initial
Purchasers or any controlling person referred to in Section 9 hereof and (ii)
delivery of and payment for the Securities. The respective agreements,
covenants, indemnities and other statements set forth in Sections 6, 9 and 15
hereof shall remain in full force and effect, regardless of any termination or
cancellation of this Agreement.
11. Termination. (a) This Agreement may be terminated in the sole
discretion of the Initial Purchasers by notice to the Company given prior to the
Closing Date in the event that any of the Issuers shall have failed, refused or
been unable to perform all obligations and satisfy all conditions on its part to
be performed or satisfied hereunder at or prior thereto or, if at or prior to
the Closing Date:
(i) the Company or any of the Subsidiaries shall have sustained any loss
or interference with respect to its businesses or properties from fire,
flood, hurricane, accident or other calamity, whether or not covered by
insurance, or from any strike, labor dispute, slow down or work stoppage
or any legal or governmental proceeding, which loss or interference, in
the sole judgment of the Initial Purchasers, has had or has a Material
Adverse Effect, or there shall have been, in the sole judgment of the
Initial Purchasers, any event or development that, individually or in the
aggregate, has or could be reasonably likely to have a Material Adverse
Effect (including without limitation a change in control of the Company or
any of the Subsidiaries), except in each case as described in the Final
Memorandum (exclusive of any amendment or supplement thereto);
(ii) trading in securities generally on the New York Stock Exchange,
American Stock Exchange or the NASDAQ Na-
36
-36-
tional Market shall have been suspended or minimum or maximum prices shall
have been established on any such exchange or market;
(iii) a banking moratorium shall have been declared by New York or United
States authorities;
(iv) there shall have been (A) an outbreak or escalation of hostilities
between the United States and any foreign power, or (B) an outbreak or
escalation of any other insurrection or armed conflict involving the
United States or any other national or international calamity or
emergency, or (C) any material change in the financial markets of the
United States which, in the case of (A), (B) or (C) above and in the sole
judgment of the Initial Purchasers, makes it impracticable or inadvisable
to proceed with the offering or the delivery of the Securities as
contemplated by the Final Memorandum; or
(v) any securities of the Company shall have been downgraded or placed on
any "watch list" for possible downgrading by any nationally recognized
statistical rating organization.
(b) Termination of this Agreement pursuant to this Section 11 shall be without
liability of any party to any other party except as provided in Section 10
hereof.
12. Information Supplied by the Initial Purchasers. The statements
set forth in third, fifth, sixth and seventh paragraphs under the heading
"Private Placement" in the Final Memorandum (to the extent such statements
relate to the Initial Purchasers) constitute the only information furnished by
the Initial Purchasers to the Issuers for the purposes of Sections 2(a) and 9
hereof.
13. Notices. All communications hereunder shall be in writing and,
if sent to the Initial Purchasers, shall be mailed or delivered to BT Alex.
Brown Incorporated, 130 Liberty Street, New York, New York 10006, Attention:
Corporate Finance Department, with a copy to Cahill Gordon & Reindel, 80 Pine
Street, New York, New York 10005, Attention: William M. Hartnett; if sent to the
Issuers, shall be mailed or delivered to the Company at 8023 Vantage Drive, P.O.
Box 659508, San Antonio, Texas 78285-9508, Attention: Chief Financial Officer,
with a copy to Shearman & Sterling, 555 California Street, San Francisco,
California 94104, Attention: Steven E. Sherman.
37
-37-
All such notices and communications shall be deemed to have been
duly given: when delivered by hand, if personally delivered; five business days
after being deposited in the mail, postage prepaid, if mailed; and one business
day after being timely delivered to a next-day air courier.
14. Successors. This Agreement shall inure to the benefit of and be
binding upon the Initial Purchasers, the Issuers and their respective successors
and legal representatives, and nothing expressed or mentioned in this Agreement
is intended or shall be construed to give any other person any legal or
equitable right, remedy or claim under or in respect of this Agreement, or any
provisions herein contained; this Agreement and all conditions and provisions
hereof being intended to be and being for the sole and exclusive benefit of such
persons and for the benefit of no other person except that (i) the indemnities
of the Issuers contained in Section 9 of this Agreement shall also be for the
benefit of the affiliates, directors, officers, agents, representatives and
employees of the Initial Purchasers or their affiliates and any person or
persons who control any of the Initial Purchasers within the meaning of Section
15 of the Act or Section 20 of the Exchange Act and (ii) the indemnities of the
Initial Purchasers contained in Section 9 of this Agreement shall also be for
the benefit of the affiliates, directors, officers, agents, representatives and
employees of the Initial Purchasers or their affiliates and the directors of the
Issuers, their respective officers and any person or persons who control an
Issuer within the meaning of Section 15 of the Act or Section 20 of the Exchange
Act. No purchaser of Securities from the Initial Purchasers will be deemed a
successor because of such purchase.
15. APPLICABLE LAW. THE VALIDITY AND INTERPRETATION OF THIS
AGREEMENT, AND THE TERMS AND CONDITIONS SET FORTH HEREIN SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND TO BE PERFORMED WHOLLY THEREIN, WITHOUT GIVING EFFECT TO ANY
PROVISIONS THEREOF RELATING TO CONFLICTS OF LAW.
16. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
38
-38-
If the foregoing correctly sets forth our understanding, please indicate
your acceptance thereof in the space provided below for that purpose, whereupon
this letter shall constitute a binding agreement between the Company, the
Guarantors set forth below and the Initial Purchasers.
Very truly yours,
KINETIC CONCEPTS, INC.
By: /s/ DENNIS E. NOLL
----------------------------
Name:
Title:
KCI HOLDING COMPANY, INC.
By: /s/ DENNIS E. NOLL
----------------------------
Name:
Title:
KCI PROPERTIES LTD.
By: /s/ DENNIS E. NOLL
----------------------------
Name:
Title:
KCI REAL PROPERTY LTD.
By: /s/ DENNIS E. NOLL
----------------------------
Name:
Title:
KCI THERAPEUTIC SERVICES, INC.
By: /s/ DENNIS E. NOLL
----------------------------
Name:
Title:
39
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KCI NEW TECHNOLOGIES, INC.
By: /s/ DENNIS E. NOLL
----------------------------
Name:
Title:
KCI INTERNATIONAL, INC.
By: /s/ DENNIS E. NOLL
----------------------------
Name:
Title:
KCI AIR, INC.
By: /s/ DENNIS E. NOLL
----------------------------
Name:
Title:
KCI-RIK ACQUISITION CORP.
By: /s/ DENNIS E. NOLL
----------------------------
Name:
Title:
PLEXUS ENTERPRISES, INC.
By: /s/ DENNIS E. NOLL
----------------------------
Name:
Title:
MEDICAL RETRO DESIGN
By: /s/ DENNIS E. NOLL
----------------------------
Name:
Title:
40
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The foregoing Agreement is hereby confirmed and accepted
as of the date first above written.
BT ALEX. BROWN INCORPORATED
By: /s/ KATE W. COOK
-------------------------------
Name: Kate W. Cook
Title: Managing Director
BANCAMERICA ROBERTSON STEPHENS
By: /s/ MARK S. DAWLEY
-------------------------------
Name:Mark S. Dawley
Title: Senior Managing Director
41
SCHEDULE
SUBSIDIARIES
Jurisdiction of
Name Stockholder(s) Incorporation
---- -------------- -------------
KCI Holding Company, Kinetic Concepts, Inc. Delaware
Inc.
KCI Properties Ltd. Kinetic Concepts, Inc. Texas
KCI Real Properties Kinetic Concepts, Inc. Texas
Ltd.
KCI Therapeutic Kinetic Concepts, Inc. Delaware
Services, Inc. and KCI Properties
Ltd.
KCI New Technologies, Kinetic Concepts, Inc. Delaware
Inc.
KCI International, Kinetic Concepts, Inc. Delaware
Inc.
KCI Air, Inc. Kinetic Concepts, Inc. Delaware
[Add other Subsidiaries]
42
SCHEDULE II
Principal amount of
Initial Purchaser Securities to be Purchased
- ----------------- --------------------------
BT Alex. Brown Incorporated $ 100,000,000
BancAmerica Robertson Stephens $ 100,000,000
-------------
Total $ 200,000,000