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Exhibit 1.1
FOOD 4 LESS SUPERMARKETS, INC.
$295,000,000 ___% Senior Notes due 2004
$200,000,000 ___% Senior Subordinated Notes due 2005
(Interest Payable ______________ and ______________)
UNDERWRITING AGREEMENT
___________ __, 1995
BT Securities Corporation
CS First Boston Corporation
Donaldson, Lufkin & Jenrette
Securities Corporation
c/o BT Securities Corporation
One Bankers Trust Plaza
New York, New York 10005
Ladies and Gentlemen:
Food 4 Less Supermarkets, Inc., a Delaware
corporation ("Food 4 Less"), intends to merge (the "Merger")
with and into Ralphs Supermarkets, Inc., a Delaware corporation
("RSI"), with RSI surviving the Merger (as such surviving
company, the "Surviving Company"), pursuant to an Agreement and
Plan of Merger dated as of September 14, 1994 (as amended
through the date hereof, the "Merger Agreement"), by and among
Food 4 Less, Food 4 Less, Inc. ("F4L"), Food 4 Less Holdings,
Inc. ("Holdings"), RSI and the stockholders of RSI. Upon
consummation of the Merger, it is anticipated that the
Surviving Company will merge with its wholly owned subsidiary,
Ralphs Grocery Company, a Delaware corporation ("RGC"), with
the Surviving Company surviving such merger (the "Subsequent
Merger", and together with the Merger, the "Mergers"). Upon
consummation of the Mergers, the Surviving Company will change
its name to "Ralphs Grocery Company" ("Ralphs"). Prior to the
Merger, (i) F4L intends to merge with Holdings, with Holdings
surviving such merger (the "F4L Merger") and (ii) immediately
following the F4L Merger, Holdings will merge with and into its
newly formed wholly-owned subsidiary incorporated in Delaware
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("New Holdings"), with New Holdings surviving such Merger (the
"Delaware Merger" and together with the F4L Merger, the "Equity
Merger").
In connection with the Mergers, (i) Food 4 Less
proposes to offer (collectively, the "F4L Exchange Offers") to
holders of its 10.45% Senior Notes due 2000 (the "Old F4L
10.45% Notes") and its 13.75% Senior Subordinated Notes due
2001 (the "Old F4L 13.75% Notes", and together with the Old
10.45% Notes, the "Old F4L Notes") upon the terms and subject
to the conditions set forth in the Prospectus and Solicitation
Statement dated May 12, 1995 (the "F4L Prospectus"), to
exchange (a) for each $1,000 principal amount of Old 10.45%
Notes, $1,000 principal amount of new Senior Notes due 2004 of
the Surviving Company (the "Senior Notes") and a cash payment
and (b) for each $1,000 principal amount of Old 13.75% Notes,
$1,000 principal amount of new Senior Subordinated Notes due
2005 of the Surviving Company and a cash payment and (ii) Food
4 Less proposes to offer (collectively, the "RGC Offers") to
holders of the 9% Senior Subordinated Notes due 2003 of RGC
(the "9% RGC Notes") and the 10 1/4% Senior Subordinated Notes
due 2002 of RGC (the "10 1/4% RGC Notes", and together with the
9% RGC Notes, the "Old RGC Notes", and together with the Old
F4L Notes, the "Old Notes") upon the terms and subject to the
conditions set forth in the Prospectus and Solicitation
Statement dated May 12, 1995 (the "RGC Prospectus"), (a) to
exchange for each $1,000 principal amount of Old RGC Notes,
$1,000 principal amount of new Senior Subordinated Notes due
2005 of the Surviving Company (the "Senior Subordinated Notes")
and a cash payment and (b) to purchase for cash any or all of
the Old RGC Notes. The Senior Notes will be issued pursuant to
an Indenture (the "Senior Note Indenture") to be entered into
by the Surviving Company, as issuer, each of Alpha Beta
Company, Bay Area Warehouse Stores, Inc., Bell Markets, Inc.,
Cala Co., Cala Foods, Inc., Falley's Inc., Food 4 Less of
California, Inc., Food 4 Less Merchandising, Inc., Food 4 Less
of Southern California, Inc. and Food 4 Less GM, Inc., as
guarantors, (collectively, the "Subsidiary Guarantors") and
Norwest Bank Minnesota N.A., as trustee (the "Senior Note
Trustee). The Senior Subordinated Notes will be issued
pursuant to an Indenture (the "Senior Subordinated Note
Indenture" and together with the Senior Note Indenture, the
"Indentures") to be entered into by the Surviving Company, as
issuer, the Subsidiary Guarantors, and United States Trust
Company of New York, as trustee (the "Senior Subordinated Note
Trustee" and collectively with the Senior Note Trustee (the
"Trustees")). The New Senior Notes and the New Senior
Subordinated Notes will be unconditionally guaranteed (the
"Guarantees"), on a joint and several basis, by each of the
Subsidiary Guarantors pursuant to the terms of the applicable
indenture. As used in this Agreement, the term "Issuers" shall
refer collectively to Food 4 Less (or after giving effect to
the Mergers, the Surviving Company) and the Subsidiary
Guarantors.
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Upon consummation of the Mergers, the Surviving
Company and the Subsidiary Guarantors will enter into an
indenture supplemental to each of the Indentures (the
"Supplemental Indentures") with the trustees thereunder and
Crawford Stores, Inc., an indirect wholly-owned subsidiary of
RSI, pursuant to which such subsidiary (the "Additional
Guarantor") will guarantee the Senior Notes and the Senior
Subordinated Notes, pursuant to and in accordance with the
applicable Indenture. As used herein with respect to periods
subsequent to the consummation of the Merger, the term
"Subsidiary Guarantor" will include the Additional Guarantor.
The Issuers hereby confirm their agreement with you
(the "Underwriters"), as set forth below.
1. The Securities. Subject to the terms and
conditions herein contained, the Surviving Company (as defined)
proposes to issue and sell to the Underwriters (i) $295,000,000
aggregate principal amount of its Senior Notes, which will be
part of the same issue as the Senior Notes issued pursuant to
the F4L Exchange Offers and (ii) $200,000,000 aggregate
principal amount of its Senior Subordinated Notes, which will
be part of the same issue as the Senior Subordinated Notes
issued pursuant to the RGC Offers. The Senior Notes and the
Senior Subordinated Notes to be issued and sold by the
Surviving Company to the several Underwriters pursuant to this
Agreement are hereinafter referred to collectively as the
"Notes"; and the Notes and the related Guarantees are
hereinafter referred to collectively as the "Securities".
2. Representations and Warranties
(a) Each Issuer jointly and severally represents and
warrants to and agrees with the Underwriters that:
(i) A registration statement on Form S-1 (File
No. 33-57185), with respect to the Securities, including a
prospectus, subject to completion, has been filed by the
Issuers with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended
(together with the rules and regulations of the Commission
promulgated thereunder, the "Act"); and one or more
amendments to such registration statement also have been
so filed. After the execution of this Agreement, the
Issuers will file with the Commission either (x) if such
registration statement, as it may have been amended, has
been declared by the Commission to be effective under the
Act, a prospectus in the form most recently included in an
amendment to such registration statement (or, if no such
amendment shall have been filed, such registration
statement) with such changes or insertions as are required
by Rule 430A under the Act or permitted by Rule 424(b)
under the Act and as have been provided to and approved by
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the Underwriters prior to the execution of this Agreement,
or (y) if such registration statement, as it may have been
amended, has not been declared by the Commission to be
effective under the Act, an amendment to such registration
statement, including a form of prospectus, a copy of which
amendment has been furnished to and approved by the
Underwriters prior to the execution of this Agreement. As
used in this Agreement, the term "Registration Statement"
means such registration statement, as amended at the time
when it was or is declared effective, including all
financial schedules and exhibits thereto and including any
information omitted therefrom pursuant to Rule 430A under
the Act and included in the Prospectus (as hereinafter
defined); the term "Preliminary Prospectus" means each
prospectus, subject to completion, filed with such
registration statement or any amendment thereto (including
the prospectus, subject to completion, if any, included in
such Registration Statement or any amendment thereto at
the time it was or is declared effective); and the term
"Prospectus" means the prospectus first filed with the
Commission pursuant to Rule 424(b) under the Act or, if no
prospectus is required to be filed pursuant to said Rule
424(b) such term means the prospectus included in such
Registration Statement.
(ii) The Commission has not issued any order
preventing or suspending the use of any Preliminary
Prospectus. When any Preliminary Prospectus was filed
with the Commission it (x) complied in all material
respects with the requirements of the Act and (y) did not
include any untrue statement of a material fact or omit to
state any material fact necessary in order to make the
statements therein, in the light of the circumstances
under which they were made, not misleading. When the
Registration Statement or any amendment thereto was or is
declared effective, it (x) complied or will comply in all
material respect with the requirements of the Act and (y)
did not or will not include any untrue statement of a
material fact or omit to state any material fact necessary
to make the statements therein not misleading. When the
Prospectus or any amendment or supplement thereto is filed
with the Commission pursuant to Rule 424(b) (or, if the
Prospectus or such amendment or supplement is not required
to be so filed, when the Registration Statement or the
amendment thereto containing such amendment or supplement
to the Prospectus was or is declared effective) and on the
Closing Date (as defined in Section 3), the Prospectus, as
amended or supplemented at any such time, (x) complied or
will comply in all material respects with the requirements
of the Act and (y) did not or will not include any untrue
statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made,
not misleading. The foregoing provisions of this
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paragraph (ii) do not apply to statements or omissions
made in any Preliminary Prospectus, the Registration
Statement or any amendment thereto or the Prospectus or
any amendment or supplement thereto in reliance upon and
in conformity with written information furnished to the
Issuers by the Underwriters specifically for use therein,
as referenced in Section 11 hereof, or to the Statements
of Eligibility and Qualification (the "Forms T-1") under
the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act") of the Trustees filed as exhibits to the
Registration Statement.
(iii) Each of Food 4 Less and the Subsidiary
Guarantors has, and after giving effect to the Mergers and
the Equity Merger, the Surviving Company and the
Subsidiary Guarantors will have, all the necessary
corporate power and authority to execute and deliver this
Agreement, to perform its obligations hereunder and to
consummate the transactions contemplated hereby and by the
Prospectus (or, if the Prospectus is not in existence, the
most recent Preliminary Prospectus). Each of Food 4 Less
and the Subsidiary Guarantors has, and after giving effect
to the Mergers and the Equity Merger, the Surviving
Company and the Subsidiary Guarantors will have, taken all
necessary corporate action to authorize the issuance of
the Securities.
(iv) Each of Food 4 Less and the Subsidiary
Guarantors has, and after giving effect to the Mergers and
the Equity Merger, the Surviving Company and the
Subsidiary Guarantors will have, been duly incorporated
and each of Food 4 Less and the Subsidiary Guarantors is,
and after giving effect to the Mergers and the Equity
Merger the Surviving Company and the Subsidiary Guarantors
will be, validly existing in good standing as a
corporation under the laws of its jurisdiction of
incorporation, with all requisite corporate power and
authority to own or lease its properties and conduct its
businesses as now conducted as described in the Prospectus
(or, if the Prospectus is not in existence, the most
recent Preliminary Prospectus), and each of Food 4 Less
and the Subsidiary Guarantors is, and after giving effect
to the Mergers and the Equity Merger the Surviving Company
and the Subsidiary Guarantors will be, 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 businesses requires
such qualification, except where the failure to be so
qualified would not have (x) a material adverse effect on
the business, condition (financial or other) or results of
operations of Food 4 Less and the Subsidiary Guarantors
(or, after giving effect to the Equity Merger, the
Mergers, and the other transactions contemplated by the
Prospectus (or, if the Prospectus is not in existence, the
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most recent Preliminary Prospectus) the Surviving Company
and its subsidiaries) taken as a whole; or (y) an adverse
effect on the ability of Food 4 Less or any Subsidiary
Guarantor to perform any of its material obligations under
any of the agreements, documents or instruments
contemplated to be entered into by Food 4 Less or any of
the Subsidiary Guarantors hereby or by the Prospectus (or,
if the Prospectus is not in existence, the most recent
Preliminary Prospectus), (collectively, the "Transaction
Documents") to which it is a party either before or after
giving effect to the Mergers and the other transactions
contemplated by the Prospectus (or, if the Prospectus is
not in existence the most recent Preliminary Prospectus)
(a "Material Adverse Effect"); Food 4 Less has, and upon
consummation of the Equity Merger and the Mergers, the
Surviving Company will have (based upon the assumptions
described and referred to in the first paragraph of the
Prospectus (or, if the Prospectus is not in existence, the
most recent Preliminary Prospectus) under the caption,
"Pro Forma Capitalization"), in all material respects, the
authorized, issued and outstanding capitalization set
forth in the Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus); the
only direct or indirect subsidiaries of Food 4 Less (or,
after giving effect to the Equity Merger, the Mergers and
the other transactions contemplated by the Prospectus (or,
if the Prospectus is not in existence the most recent
Preliminary Prospectus), the Surviving Company) are the
Subsidiary Guarantors; except as aforesaid, neither Food 4
Less nor any of the Subsidiary Guarantors owns, directly
or indirectly, any of the capital stock or other equity
securities of any other person, except that Alpha Beta
Company has an investment in Certified Grocers of
California, Inc. ("Certified"), one of Food 4 Less's
suppliers, and Food 4 Less GM has an interest in a joint
venture with Certified; the outstanding shares of capital
stock of Food 4 Less and each of the Subsidiary Guarantors
(and, upon consummation of the Equity Merger and the
Mergers and the other transactions contemplated by the
Prospectus (or, if the Prospectus is not in existence, the
most recent Preliminary Prospectus), the Surviving Company
and each of its 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 granted by such person; and except as described in
the Prospectus (or, if the Prospectus is not in existence
the most recent Preliminary Prospectus), all of the
outstanding shares of capital stock of each of the
Subsidiary Guarantors are owned beneficially by Food 4
Less (and, upon consummation of the Mergers and the other
transactions contemplated by the Prospectus (or, if the
Prospectus is not in existence, the most recent
Preliminary Prospectus, the Surviving Company) free and
clear of all liens, encumbrances, security interests,
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mortgages, pledges, charges or claims. No holders of
securities of Food 4 Less or any of the Subsidiary
Guarantors (or, upon consummation of the Equity Merger,
Mergers and the other transactions contemplated by the
Prospectus (or, if the Prospectus is not in existence, the
most recent Preliminary Prospectus), the Surviving Company
or any of its subsidiaries) are entitled to have such
securities registered under the Registration Statement.
(v) The Securities have been duly and validly
authorized by Food 4 Less for issuance and conform in all
material respects to the description thereof in the
Prospectus (or, if the Prospectus is not in existence, the
most recent Preliminary Prospectus). The Securities, when
executed by the Surviving Company and authenticated by the
applicable Trustee in accordance with the provisions of
the applicable Indenture, and delivered to and paid for by
the Underwriters in accordance with the terms hereof, will
have been duly executed, issued and delivered and will
constitute valid and legally binding obligations of the
Surviving Company entitled to the benefits of the
applicable Indenture and enforceable against the Surviving
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, (ii) general principles of equity and
the discretion of the court before which any proceeding
therefor may be brought (regardless of whether such
enforcement is considered in a proceeding in equity or at
law), (iii) the unenforceability, under certain
circumstances, of provisions imposing penalties,
forfeitures, late payment charges or an increase in
interest rate upon delinquency in payment or the
occurrence of a default, and (iv) the unenforceability of
any provision requiring the payment of attorneys' fees,
except to the extent that a court determines such fees to
be reasonable. Food 4 Less and the Subsidiary Guarantors
(and, upon consummation of the Equity Merger, the Mergers
and the other transactions contemplated by the Prospectus
(or, if the Prospectus is not in existence, the most
recent Preliminary Prospectus), the Surviving Company and
the Subsidiary Guarantors) have all requisite corporate
power and authority to execute, deliver and perform its
obligations under the Indentures and the Guarantees. Upon
consummation of the Mergers, the Surviving Company will
have all requisite corporate power and authority to issue
and deliver the Securities and each Subsidiary Guarantor
will have all requisite corporate power and authority to
issue and deliver its Guarantees to the Underwriters as
provided herein. Each of the Indentures has been duly
authorized by Food 4 Less and the Subsidiary Guarantors
and, when executed and delivered by Food 4 Less and the
Subsidiary Guarantors (and, upon consummation of the
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Equity Merger, the Mergers and the other transactions
contemplated by the Prospectus (or if the Prospectus is
not in existence, the most recent Prelimianry Prospectus),
the Surviving Company and the Subsidiary Guarantors)
(assuming the due authorization, execution and delivery
thereof by the applicable Trustee), will constitute a
valid and legally binding agreement of each of the
Surviving Company and the Subsidiary Guarantors
enforceable against each of them in accordance with its
terms, except that the enforcement thereof may be subject
to (v) bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance or other laws now or hereafter in
effect relating to creditors' rights generally, including,
without limitation, the effect on the Guarantees of
Section 548 of the Bankruptcy Code and comparable
provisions of state law, (w) general principles of equity
and the discretion of the court before which any
proceeding therefor may be brought (regardless of whether
such enforcement is considered in a proceeding in equity
or at law), (x) the unenforceability, under certain
circumstances, of provisions imposing penalties,
forfeitures, late payment charges or an increase in
interest rate upon delinquency in payment or the
occurrence of a default, (y) the unenforceability of any
provision requiring the payment of attorneys' fees, except
to the extent that a court determines such fees to be
reasonable and (z) the unenforceability of the provisions
contained in the Indentures relating to the waiver of
(A) stay, extension or usury laws and (B) subrogation
rights or other rights and defences of the Subsidiary
Guarantors.
(vi) The Guarantees endorsed on the Securities have
been duly authorized and, when executed and delivered,
will, upon the execution, authentication and delivery of
the Securities and payment therefor, be valid and binding
obligations of each Subsidiary Guarantor enforceable
against such Subsidiary Guarantor in accordance with their
respective terms, except that the enforcement thereof may
be subject to (w) bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or other similar laws
now or hereafter in effect relating to creditors' rights
generally, including, without limitation, the effect on
the Guarantees of Section 548 of the Bankruptcy Code and
comparable provisions of state law, (x) general principles
of equity and the discretion of the court before which any
proceeding therefor may be brought (regardless of whether
such enforcement is considered in a proceeding in equity
or at law), (y) the unenforceability, under certain
circumstances, of provisions imposing penalties,
forfeitures, late payment charges or an increase in
interest rate upon delinquency in payment or the
occurrence of a default, and (z) the unenforceability of
any provision requiring the payment of attorneys' fees,
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except to the extent that a court determines such fees to
be reasonable.
(vii) This Agreement has been duly authorized,
executed and delivered by Food 4 Less and each of the
Subsidiary Guarantors and, assuming the due authorization,
execution and delivery hereof by the Underwriters,
constitutes the valid and legally binding obligation of
Food 4 Less and the Subsidiary Guarantors enforceable
against Food 4 Less and the Subsidiary Guarantors (and
after giving effect to the Equity Merger and the Mergers,
the Surviving Company and its subsidiaries) in accordance
with its terms, except that the enforcement hereof may be
subject to (v) bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally,
(w) general principles of equity and the discretion of the
court before which any proceeding therefor may be brought
(regardless of whether such enforcement is considered in a
proceeding in equity or at law), (x) the unenforceability,
under certain circumstances, of provisions imposing
penalties, forfeitures, late payment charges or an
increase in interest rate upon delinquency in payment or
the occurrence of a default, (y) the unenforceability of
any provision requiring the payment of attorneys' fees,
except to the extent that a court determines such fees to
be reasonable and (z) the unenforceability under certain
circumstances under law or court decisions of provisions
for the indemnification of or contribution to a party with
respect to a liability where such indemnification or
contribution is contrary to public policy. Except as
described in the Prospectus (or, if the Prospectus is not
in existence, the most recent Preliminary Prospectus), no
consent, approval, authorization or order of any court or
governmental agency or body is required for the
performance of this Agreement, the Securities, the
Guarantees, the Indentures, or any of the other
Transaction Documents by Food 4 Less or any Subsidiary
Guarantors (or upon consummation of the Equity Merger and
the Mergers, the Surviving Company or any Subsidiary
Guarantor) (to the extent each such person is a party
thereto) or the consummation by Food 4 Less or any
Subsidiary Guarantors (or upon consummation of the Equity
Merger and the Mergers, the Surviving Company or any
Subsidiary Guarantor) of any of the transactions
contemplated hereby or thereby or by the Prospectus (or,
if the Prospectus is not in existence, the most recent
Preliminary Prospectus), except such as have been obtained
and such as may be required under the Act, the Trust
Indenture Act or state securities or "Blue Sky" laws in
connection with the purchase and distribution of the
Securities by the Underwriters, the Equity Merger, the
Mergers or any of such other transactions. None of Food 4
Less or any of the Subsidiary Guarantors is (and upon
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consummation of the Equity Merger and the Mergers, none of
the Surviving Company or any of the Subsidiary Guarantors
will be) (i) in violation of its certificate of
incorporation or bylaws, (ii) in violation of any statute,
judgment, decree, order, rule or regulation applicable to
Food 4 Less or any of the Subsidiary Guarantors (or upon
consummation of the Equity Merger and the Mergers, the
Surviving Company or any of the Subsidiary Guarantors)
which violation would have a Material Adverse Effect, or
(iii) in default in the performance or observance of any
obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, deed of trust, loan
agreement, note, lease, license, franchise agreement,
permit, certificate or other agreement or instrument to
which Food 4 Less or any of the Subsidiary Guarantors (or
upon consummation of the Equity Merger and the Mergers,
the Surviving Company or any of the Subsidiary Guarantors)
is subject, which default would have a Material Adverse
Effect.
The execution, delivery and performance by Food 4
Less and the Subsidiary Guarantors (and upon consummation
of the Equity Merger and the Mergers, the Surviving
Company and the Subsidiary Guarantors) of this Agreement
the Securities, the Guarantees, the Indentures and each of
the other Transaction Documents (to the extent each such
person is a party thereto), and the consummation by Food 4
Less and each of the Subsidiary Guarantors (and upon
consummation of the Equity Merger and the Mergers, the
Surviving Company and the Subsidiary Guarantors) of the
transactions contemplated hereby, thereby and by the
Prospectus (or, if the Prospectus is not in existence, the
most recent Preliminary Prospectus) will not (after giving
effect to all amendments and waivers obtained on or prior
to the Closing Date (as hereinafter defined) which are
described in the Prospectus (or, if the Prospectus is not
in existence, the most recent Preliminary Prospectus))
conflict with or constitute or result in a breach or
violation by Food 4 Less or any of the Subsidiary
Guarantors (or upon consummation of the Equity Merger and
the Mergers, the Surviving Company or any of the
Subsidiary Guarantors) of any of (x) the terms or
provisions of, or constitute a default by Food 4 Less or
any of the Subsidiary Guarantors (or upon consummation of
the Mergers, the Surviving Company or any of the
Subsidiary Guarantors) under, any indenture, mortgage,
deed of trust, loan agreement, note, lease, license,
franchise agreement, or other agreement or instrument to
which any such person is a party or to which any of them
or their respective properties is subject, which conflict,
breach, violation or default would have a Material Adverse
Effect, (y) the certificate of incorporation or bylaws of
any such person, or (z) any statute, judgment, decree,
order, rule or regulation (excluding state securities and
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"Blue Sky" laws) of any court or governmental agency or
other body applicable to any such person, or any of their
respective properties, which conflict, breach, violation
or default would have a Material Adverse Effect.
(viii) (x) Immediately after the consummation of the
Equity Merger, the Mergers, the issuance of the Securities
and the other transactions contemplated by the Prospectus
(or, if the Prospectus is not in existence, the most
recent Preliminary Prospectus), the fair value and present
fair saleable value of the assets of the Surviving Company
and each Subsidiary Guarantor will exceed the sum of its
stated liabilities and identified contingent liabilities;
and (y) after giving effect to the execution, delivery and
performance of the Transaction Documents and the
consummation of the transactions contemplated thereby and
by the Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus),
neither Food 4 Less or any Subsidiary Guarantor is, nor,
upon consummation of the Mergers, will the Surviving
Company or any Subsidiary Guarantor be, (a) left with
unreasonably small capital with which to carry on its
business as it is proposed to be conducted, (b) unable to
pay its debts (contingent or otherwise) as they mature or
(c) insolvent.
(ix) Each of Food 4 Less and the Subsidiary
Guarantors have, and upon consummation of the Equity
Merger and the Mergers, the Surviving Company and each of
the Subsidiary Guarantors will have, all requisite
corporate power and authority to execute, deliver and
perform their respective obligations under each of the
Transaction Documents (to the extent each is a party
thereto). As of the Closing Date, each of the Transaction
Documents will have been duly and validly authorized by
each of Food 4 Less and the Subsidiary Guarantors, and
upon consummation of the Equity Merger and the Mergers,
the Surviving Company and each of the Subsidiary
Guarantors (to the extent each is a party thereto); and,
when executed and delivered by Food 4 Less and the
Subsidiary Guarantors (to the extent each is a party
thereto), each such Transaction Document will constitute a
valid and legally binding obligation of each of Food 4
Less and the Subsidiary Guarantors (and will, upon
consummation of the Equity Merger and the Mergers,
constitute a valid and legally binding obligation of the
Surviving Company and each of the Subsidiary Guarantors),
to the extent each is a party thereto, enforceable against
each such person in accordance with its terms except that
the enforcement thereof may be subject to (w) bankruptcy,
insolvency, reorganization, moratorium, fraudulent
conveyance or other similar laws now or hereafter in
effect relating to creditors' rights generally,
(x) general principles of equity and the discretion of the
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court before which any proceeding therefor may be brought
(regardless of whether such enforcement is considered in a
proceeding in equity or at law), (y) the unenforceability,
under certain circumstances, of provisions imposing
penalties, forfeitures, late payment charges or an
increase in interest rate upon delinquency in payment or
the occurrence of a default, and (z) the unenforceability
of any provision requiring the payment of attorneys' fees,
except to the extent that a court determines such fees to
be reasonable.
(x) As of the Closing Date each of the Supplemental
Indentures will have been duly and validly authorized by
Crawford Stores. The Supplemental Indentures, when
executed and delivered by Crawford Stores (assuming the
due authorization, execution and delivery thereof by the
applicable Trustee) will have been duly executed and
delivered and will constitute valid and legally binding
obligations of Crawford Stores enforceable against
Crawford Stores in accordance with their terms, except
that the enforcement thereof may be subject to
(i) bankruptcy, insolvency, reorganization, moratorium or
other similar laws now or hereafter in effect relating to
creditors' rights generally, (ii) general principles of
equity and the discretion of the court before which any
proceeding therefor may be brought (regardless of whether
such enforcement is considered in a proceeding in equity
or at law), (iii) the unforceability, under certain
circumstances, of provisions imposing penalties,
forfeitures, late payment charges or an increase in
interest rate upon delinquency in payment or the
occurrence of a default, and (iv) the unenforceability of
any provision requiring the payment of attorneys' fees,
except to the extent that a court determines such fees to
be reasonable.
(xi) As of the Closing Date, the Equity Merger will
have been duly authorized by Holdings and F4L and will
have been duly approved by the stockholder of F4L; the
Equity Merger will conform in all material respects to the
description thereof in the Prospectus (or, if the
Prospectus is not in existence, the most recent
Preliminary Prospectus). The Mergers have been duly
authorized by Food 4 Less and have been duly approved by
Food 4 Less' stockholders; the Merger Agreement conforms
and the Mergers will conform in all material respects to
the description thereof in the Prospectus (or, if the
Prospectus is not in existence the most recent Preliminary
Prospectus).
(xii) Except as disclosed in the Prospectus (or, if
the Prospectus is not in existence, the most recent
Preliminary Prospectus), and except as would not
individually or in the aggregate have a Material Adverse
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Effect (w) Food 4 Less and each of the Subsidiary
Guarantors is in compliance with all applicable
Environmental Laws (as defined below), (x) Food 4 Less and
each of the Subsidiary Guarantors has all permits,
authorizations and approvals required under any applicable
Environmental Laws and is in compliance with their
requirements, (y) there are no pending, or to the best
knowledge of Food 4 Less or any of the Subsidiary
Guarantors threatened, Environmental Claims (as defined
below) against Food 4 Less or any of the Subsidiary
Guarantors and (z) Food 4 Less and each of the Subsidiary
Guarantors does not have knowledge of any circumstances
with respect to any of their respective properties or
operations that could reasonably be anticipated to form
the basis of an Environmental Claim against Food 4 Less or
any of the Subsidiary Guarantors or any of their
respective properties or operations and the business
operations relating thereto that could reasonably be
expected to have a Material Adverse Effect. For purposes
of this Agreement, the following terms shall have the
following meanings: "Environmental Law" means, with
respect to any person, any federal, state, local or
municipal statute, law, rule, regulation, ordinance, code,
policy or rule of common law and any published judicial or
administrative interpretation thereof including any
judicial or administrative order, consent decree or
judgment binding on such person or any of its
subsidiaries, relating to the environment, health, safety
or any chemical, material or substance, exposure to which
is prohibited, limited or regulated by any such
governmental authority. "Environmental Claims" means any
and all administrative, regulatory or judicial actions,
suits, demands, demand letters, claims, liens, notices of
noncompliance or violation, investigations or proceedings
relating in any way to any Environmental Law.
(xiii) The audited consolidated financial statements
and schedules of Food 4 Less included in the Registration
Statement and Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus) present
fairly the consolidated financial position, results of
operations and cash flows of Food 4 Less at the dates and
for the periods to which they relate, and have been
prepared in accordance with generally accepted accounting
principles applied on a consistent basis, except as
otherwise stated therein, and the unaudited consolidated
financial statements of Food 4 Less and the related notes
included in the Prospectus (or, if the Prospectus is not
in existence, the most recent Preliminary Prospectus)
present fairly the consolidated financial position,
results of operations and cash flows of Food 4 Less at the
dates and for the periods to which they relate, subject to
year-end audit adjustments, and have been prepared in
accordance with generally accepted accounting principles
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applied on a consistent basis, except as otherwise stated
therein.
The pro forma financial statements and other pro
forma financial information (including the notes thereto)
included in the Prospectus (or, if the Prospectus is not
in existence, the most recent Preliminary Prospectus) and
the Registration Statement have been prepared in
accordance with applicable requirements of Regulation S-X
promulgated under the Securities and Exchange Act of 1934,
as amended (the "Exchange Act") and have been properly
computed on the bases described therein. The assumptions
used in the preparation of the pro forma financial
statements and other pro forma financial information
included in the Registration Statement and the Prospectus
(or, if the Prospectus is not in existence, the most
recent Preliminary Prospectus) are reasonable and the
adjustments used therein are appropriate to give effect to
the transactions or circumstances referred to therein.
Arthur Andersen LLP, which has audited certain of
such financial statements and schedules as set forth in
their reports included in the Registration Statement and
the Prospectus (or, if the Prospectus is not in existence,
the most recent Preliminary Prospectus) is an independent
public accounting firms as required by the Act. The
statistical and market-related data (including, without
limitation, the estimated cost savings information)
included in the Registration Statement and the Prospectus
(or, if the Prospectus is not in existence, the most
recent Preliminary Prospectus) are based on or derived
from sources which Food 4 Less and the Subsidiary
Guarantors believe to be reliable and accurate.
(xiv) Except as described in the Prospectus (or, if
the Prospectus is not in existence, the most recent
Preliminary Prospectus) there is not pending or, to the
knowledge of Food 4 Less or any of the Subsidiary
Guarantors, threatened, any action, suit, proceeding,
inquiry or investigation to which Food 4 Less or any
Subsidiary Guarantors, or to which the property of Food 4
Less or any Subsidiary Guarantors is subject, before or
brought by any court or governmental agency or body, which
would if adversely determined have a Material Adverse
Effect.
(xv) Food 4 Less and each of the Subsidiary
Guarantors has (and upon consummation of the Equity Merger
and the Mergers, the Surviving Company and each of its
subsidiaries will have) (a) good and marketable title to
all the properties and other material assets (personal,
tangible, intangible or mixed) owned by it, or purported
to be owned by it, and, as of the Closing Date (after
giving effect to the Equity Merger and the Mergers), such
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title will be free and clear of all liens, except for
liens which would be permitted under the Indentures and
(b) peaceful and undisturbed possession under all leases
to which it is a party as lessee or sublessee, except for
such defects in title or lack of possession that, in the
aggregate, could not reasonably be expected to have a
Material Adverse Effect. Food 4 Less and each of the
Subsidiary Guarantors operates (and upon consummation of
the Equity Merger and the Mergers, the Surviving Company
and each of its subsidiaries will operate) all material
real and personal property leased by it under valid and
enforceable leases and has, and upon consummation of the
Equity Merger and the Mergers, shall have, performed in
all material respects the obligations required to be
performed by it with respect to each such lease, except
for such leases and obligations which, in the aggregate,
could not reasonably be expected to have a Material
Adverse Effect. As to leases with respect to which Food 4
Less or any Subsidiary Guarantor is the lessor, the
lessees and other parties under such leases are in
compliance with all terms and conditions thereunder and
such leases are in full force and effect except for any
failures to comply or remain in full force and effect
which could not reasonably be expected to have a Material
Adverse Effect. All tangible assets and properties of
each of Food 4 Less and the Subsidiary Guarantors are in
good working order (subject to ordinary wear and tear) and
are adequate for the uses to which they are being put or
would be put in the ordinary course of business except for
such assets and properties as are not material in the
aggregate to the business, condition (financial or
otherwise) or results of operations of Food 4 Less and the
Subsidiary Guarantors taken as a whole.
(xvi) Food 4 Less and the Subsidiary Guarantors own,
or are licensed under, and have (and upon consummation of
the Equity Merger and the Mergers, the Surviving Company
and each of its subsidiaries will be licensed under and
will have) the rights to use, all trademarks and trade
names (collectively, "Intellectual Property") used in, or
necessary for the conduct of, their businesses as
currently conducted, and the consummation of the
transactions contemplated hereby and by the Prospectus
(or, if the Prospectus is not in existence, the most
recent Preliminary Prospectus) will not alter or impair
any such rights, except for such alterations or
impairments as could not reasonably be expected to have a
Material Adverse Effect. To the best knowledge of Food 4
Less and the Subsidiary Guarantors no claims have been
asserted by any person to the use of any such Intellectual
Property or challenging or questioning the validity or
effectiveness of any license or agreement related thereto,
except for such alterations or impairments as could not
reasonably be expected to have a Material Adverse Effect.
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To the best knowledge of Food 4 Less and the Subsidiary
Guarantors, there is no valid basis for any such claim and
the use of such Intellectual Property by Food 4 Less and
the Subsidiary Guarantors does not infringe on the rights
of any person. Food 4 Less and each of the Subsidiary
Guarantors has obtained all licenses, permits, franchises
and other governmental authorizations, the lack of which
would have a Material Adverse Effect.
(xvii) Subsequent to the respective dates as of
which information is given in the Registration Statement
and Prospectus (or, if the Prospectus is not in existence,
the most recent Preliminary Prospectus) and except as
described therein or contemplated thereby, (x) neither
Food 4 Less nor any of the Subsidiary Guarantors has
incurred any material liabilities or obligations, direct
or contingent, or entered into any material transactions,
not in the ordinary course of business and (y) neither
Food 4 Less nor any of the Subsidiary Guarantors has
purchased any of its respective outstanding capital stock,
nor declared, paid or otherwise made any dividend or
distribution of any kind on their respective capital stock
or otherwise.
(xviii) There are no legal or governmental
proceedings required to be described in the Registration
Statement or Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus) that
are not described as required, nor any contracts or other
documents required to be described in the Registration
Statement or Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus) or to
be filed as exhibits to the Registration Statement by the
Act that have not been described or filed as required.
(xix) All taxes, assessments, fees and other charges
(including, without limitation, withholding taxes,
penalties, and interest) due or claimed to be due from
Food 4 Less or any of the Subsidiary Guarantors that are
due and payable have been paid, other than those being
contested in good faith or those currently payable without
penalty or interest and for which an adequate reserve or
accrual has been established in accordance with generally
accepted accounting principles, and except where the
failure so to pay is not reasonably likely to have, singly
or in the aggregate, a Material Adverse Effect. Food 4
Less and the Subsidiary Guarantors know of no actual or
proposed additional tax assessments for any fiscal period
against Food 4 Less and the Subsidiary Guarantors that,
singly or in the aggregate, is reasonably likely to have a
Material Adverse Effect.
(xx) None of Food 4 Less or any of the Subsidiary
Guarantors, or any agent acting on behalf of any of them
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has taken or will take any action that might cause this
Agreement, the issuance or sale of the Securities or the
issuance of the Guarantees to violate Regulation G, T, U
or X of the Board of Governors of the Federal Reserve
System as in effect on the Closing Date.
(xxi) None of Food 4 Less or any of the Subsidiary
Guarantors is now, nor after giving effect to the Equity
Merger and the Mergers and the other transactions
contemplated by the Prospectus (or, if the Prospectus is
not in existence, the most recent Preliminary Prospectus)
will Food 4 Less, the Surviving Company or any Subsidiary
Guarantor be, an "investment company" or a company
"controlled by" an "investment company" within the meaning
of the Investment Company Act of 1940, as amended.
(xxii) Except as stated in the Prospectus (or, if
the Prospectus is not in existence, the most recent
Preliminary Prospectus) none of Food 4 Less or any of the
Subsidiary Guarantors know of any outstanding claims for
services, either in the nature of a finder's fee,
financial advisory fee, origination fee or similar fee,
with respect to the transactions contemplated hereby.
(xxiii) Food 4 Less and each of its subsidiaries is
in compliance with all provisions of Section 517.075 of
Florida Statutes 1987, as amended.
(xxiv) Each of the representations and warranties of
F4L, Holdings and Food 4 Less set forth in the Merger
Agreement were true and correct in all materials respects
at the time as of which such representations and
warranties were made and will be true and correct at and
as of the Closing Date as if made at and as of such date
(other than to the extent any such representation or
warranty is expressly made as to only a certain date).
(xxv) Each of the representations and warranties of
F4L, Holdings, Food 4 Less and the Subsidiary Guarantors
set forth in the Loan Agreement (as defined in the
Prospectus (or, if the Prospectus is not in existence, the
most recent Preliminary Prospectus)) were true and correct
in all materials respects at the time as of which such
representations and warranties were made and will be true
and correct at and as of the Closing Date as if made at
and as of such date (other than to the extent any such
representation or warranty is expressly made as to only a
certain date).
(xxvi) Each of the representations and warranties of
F4L, Holdings, Food 4 Less and the Subsidiary Guarantors
set forth in the Dealer Manager Agreement dated January
25, 1995 (as amended through the date hereof) among F4L,
Holdings, the Issuers and RSI on the one hand, and BT
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Securities Corporation, CS First Boston Corporation and
Donaldson, Lufkin & Jenrette Securities Corporation, as
dealer managers (the "Dealer Manager Agreement") were true
and correct in all materials respects at the time as of
which such representations and warranties were made and
will be true and correct at and as of the Closing Date as
if made at and as of such date (other than to the extent
any such representation or warranty is expressly made as
to only a certain date).
(xxvii) Except as stated in the Prospectus (or, if
the Prospectus is not in existence, the most recent
Preliminary Prospectus) neither F4L nor any of its
subsidiaries nor, to the best of Food 4 Less' knowledge,
any of F4L or is subsidiaries respective directors,
officers or controlling persons has taken, directly or
indirectly, any action designed, or which might reasonably
be expected, to cause or result, under the Act or
otherwise, in, or which has constituted, stablization or
manipulation of the price of any security of F4L or RSI or
any of their respective subsidiaries to facilitate the
exchange offers contemplated by the Transaction Documents
and the Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus).
(xxviii) Food 4 Less and the Subsidiary Guarantors,
jointly and severally, represent and warrant to and agree
with you that, as of the Closing Date, F4L, Holdings and
the Issuers have delivered to the Underwriters a true and
correct copy of each of the Transaction Documents,
together with all related agreements and all schedules and
exhibits thereto, and there have been no material
amendments, alterations, modifications and waivers as to
which the Underwriters have been advised in writing and
which would not be required to be disclosed in the
Prospectus (or, if the Prospectus is not in existence, the
most recent Preliminary Prospectus), each of the
Transaction Documents conforms in all material respects to
the description thereof in the Prospectus (or, if the
Prospectus is not in existence, the most recent
Preliminary Prospectus); and there exists as of the
Closing Date (after giving effect to the transactions
contemplated by each of the Transaction Documents and the
Prospectus (or, if the Prospectus is not in existence, the
most recent Preliminary Prospectus) no event or condition
which would constitute a default or an event of default
(in each case as defined in each of the Transaction
Documents) under any of the Transaction Documents which
would result in a Material Adverse Effect or to the best
knowledge of Food 4 Less, materially adversely affect the
ability of RSI or RGC to consummate the transactions
contemplated by the Transaction Documents and the
Prospectus (or, if the Prospectus is not in existence the
most recent Preliminary Prospectus).
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(b) RSI represents and warrants to and agrees with
the Underwriters that:
(i) RSI has all the necessary corporate power and
authority to execute and deliver this Agreement and to
perform its obligations hereunder and RSI and its
subsidiaries have all necessary corporate power and
authority to consummate the transactions contemplated
hereby and by the Prospectus (or, if the Prospectus is not
in existence, the most recent Preliminary Prospectus).
(ii) RSI and each of its subsidiaries has been
duly incorporated and is validly existing in good standing
as a corporation under the laws of its jurisdiction of
incorporation, with all requisite corporate power and
authority to own or lease its properties and conduct its
businesses as now conducted as described in the Prospectus
(or, if the Prospectus is not in existence, the most
recent Preliminary Prospectus), and 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 businesses requires
such qualification, except where the failure to be so
qualified would not have (x) a material adverse effect on
the business, condition (financial or other) or results of
operations of RSI and its subsidiaries (or, after giving
effect to the Mergers, the Surviving Company and its
subsidiaries) taken as a whole or (y) an adverse effect on
the ability of RSI or any of its subsidiaries to perform
any of its material obligations under any of the
Transaction Documents to which it is a party either before
or after giving effect to the Mergers and the other
transactions contemplated by the Prospectus (or, if the
Prospectus is not in existence, the most recent
Preliminary Prospectus) (a "Ralphs Material Adverse
Effect"); RSI has the authorized, issued and outstanding
capitalization set forth in the Prospectus (or, if the
Prospectus is not in existence, the most recent
Preliminary Prospectus); the only direct or indirect
subsidiaries of RSI are RGC and Crawford Stores, Inc.;
except as aforesaid, neither RSI nor any of its
subsidiaries owns, directly or indirectly, any of the
capital stock or other equity securities of any other
person; the outstanding shares of capital stock of each of
RSI and each of its 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 granted by RSI or any of its subsidiaries; and
except as described in the Prospectus (or, if the
Prospectus is not in existence, the most recent
Preliminary Prospectus), all of the outstanding shares of
capital stock of each of RGC and Crawford Stores, Inc. are
owned beneficially by RSI free and clear of all liens,
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20
encumbrances, security interests, mortgages, pledges,
charges or claims. No holders of securities of RSI or any
of its subsidiaries are entitled to have such securities
registered under the Registration Statements.
(iii) Except as described in the Prospectus (or,
if the Prospectus is not in existence, the most recent
Preliminary Prospectus), no consent, approval,
authorization or order of any court or governmental agency
or body is required for the performance of this Agreement
or any of the other Transaction Documents by RSI or any of
its subsidiaries (to the extent each such person is a
party thereto) or the consummation by RSI or any of its
subsidiaries of the transactions contemplated thereby or
by the Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus), except
such as have been obtained and such as may be required
under securities or "Blue Sky" laws in connection with the
Mergers or any of such transactions. Neither RSI nor any
of its subsidiaries is (x) in violation of its certificate
of incorporation or bylaws, (y) in violation of any
statute, judgment, decree, order, rule or regulation
applicable to RSI or any of its subsidiaries which
violation would have a Ralphs Material Adverse Effect, or
(iii) in default in the performance or observance of any
obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, deed of trust, loan
agreement, note, lease, license, franchise agreement,
permit, certificate or other agreement or instrument to
which RSI or any of its subsidiaries is subject, which
default would have a Ralphs Material Adverse Effect.
The execution, delivery and performance by RSI
and its subsidiaries of this Agreement and each of the
other Transaction Documents (to the extent each such
person is a party thereto), and the consummation by RSI
and its subsidiaries of the transactions contemplated
hereby, thereby and by the Prospectus (or, if the
Prospectus is not in existence, the most recent
Preliminary Prospectus) will not (after giving effect to
all amendments or waivers obtained on or prior to the
Closing Date which are described in the Prospectus (or, if
the Prospectus is not in existence, the most recent
Preliminary Prospectus)) conflict with or constitute or
result in a breach or violation by RSI or any of its
subsidiaries of any of (x) the terms or provisions of, or
constitute a default by RSI or any of its subsidiaries
under, any indenture, mortgage, deed of trust, loan
agreement, note, lease, license, franchise agreement, or
other agreement or instrument to which any such person is
a party or to which any of them or their respective
properties is subject, which conflict, breach, violation
or default would have a Ralphs Material Adverse Effect,
(y) the certificate of incorporation or bylaws of any such
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person, or (z) any statute, judgment, decree, order, rule
or regulation (excluding state securities and "Blue Sky"
laws) of any court or governmental agency or other body
applicable to any such person or any of their respective
properties, which conflict, breach, violation or default
would have a Ralphs Material Adverse Effect.
(iv) RSI and its subsidiaries have all requisite
corporate power and authority to execute, deliver and
perform their respective obligations under each of the
Transaction Documents (to the extent each is a party
thereto). As of the Closing Date, each of the Transaction
Documents will have been duly and validly authorized by
RSI and its subsidiaries (to the extent each is a party
thereto); and, when executed and delivered by RSI and its
subsidiaries (to the extent each is a party thereto), each
such Transaction Document will constitute a valid and
legally binding obligation of RSI and its subsidiaries, to
the extent each is a party thereto, enforceable against
each such person in accordance with its terms except that
the enforcement thereof may be subject to (w) bankruptcy,
insolvency, reorganization, moratorium, fraudulent
conveyance or other similar laws now or hereafter in
effect relating to creditors' rights generally, (x)
general principles of equity and the discretion of the
court before which any proceeding therefor may be brought
(regardless of whether such enforcement is considered in a
proceeding in equity or at law), (y) the unenforceability,
under certain circumstances, of provisions imposing
penalties, forfeitures, late payment charges or an
increase in interest rate upon delinquency in payment or
the occurrence of a default, and (z) the unenforceability
of any provision requiring the payment of attorneys' fees,
except to the extent that a court determines such fees to
be reasonable.
(v) The Merger has been duly authorized by RSI and
duly approved by its stockholders; as of the Closing Date
the Subsequent Merger will have been duly authorized by
RSI and duly approved by its stockholders. All
representations and warranties of RSI set forth in the
Merger Agreement were true and correct in all materials
respects at the time as of which such representations and
warranties were made and will be true and correct at and
as of the Closing Date as if made at and as of such date
(other than to the extent any such representation or
warranty is expressly made as to only a certain date).
(vi) Except as disclosed in the Prospectus (or, if
the Prospectus is not in existence, the most recent
Preliminary Prospectus), and except as would not
individually or in the aggregate have a Ralphs Material
Adverse Effect (w) RSI and each of its subsidiaries is in
compliance with all applicable Environmental Laws, (x) RSI
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and each of its subsidiaries has all permits,
authorizations and approvals required under any applicable
Environmental Laws and is in compliance with their
requirements, (y) there are no pending, or to the best
knowledge of RSI threatened, Environmental Claims against
RSI or any of its subsidiaries and (z) RSI and each of its
subsidiaries does not have knowledge of any circumstances
with respect to any of their respective properties or
operations that could reasonably be anticipated to form
the basis of an Environmental Claim against RSI or any of
its subsidiaries or any of their respective properties or
operations and the business operations relating thereto
that could reasonably be expected to have a Ralphs
Material Adverse Effect.
(vii) The audited consolidated financial
statements and schedules of RSI (as successor to RGC) and
RGC included in the Prospectus (or, if the Prospectus is
not in existence, the most recent Preliminary Prospectus)
present fairly the consolidated financial position,
results of operations and cash flows of RSI (as successor
to RGC) and RGC, respectively, at the dates and for the
periods to which they relate, and have been prepared in
accordance with generally accepted accounting principles
applied on a consistent basis, except as otherwise stated
therein, and the unaudited consolidated financial
statements of RSI (as successor to RGC) and the related
notes included in the Prospectus (or, if the Prospectus is
not in existence, the most recent Preliminary Prospectus),
if any, present fairly the consolidated financial
position, results of operations and cash flows of RSI (as
successor to RGC) at the dates and for the periods to
which they relate, subject to year-end audit adjustments,
and have been prepared in accordance with generally
accepted accounting principles applied on a consistent
basis, except as otherwise stated therein. The pro forma
financial statements and other pro forma financial
information (including the notes thereto) included in the
Prospectus (or, if the Prospectus is not in existence, the
most recent Preliminary Prospectus) have been prepared in
accordance with applicable requirements of Regulation S-X
promulgated under the Exchange Act and have been properly
computed on the bases described therein. The assumptions
used in the preparation of the pro forma financial
statements and other pro forma financial information
included in the Prospectus (or, if the Prospectus is not
in existence, the most recent Preliminary Prospectus) are
reasonable and the adjustments used therein are
appropriate to give effect to the transactions or
circumstances referred to therein. KPMG Peat Marwick,
which has examined certain of such financial statements
and schedules as set forth in their reports included in
the Prospectus (or, if the Prospectus is not in existence,
the most recent Preliminary Prospectus), are independent
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public accounting firms as required by the Act. The
statistical and market-related data (including, without
limitation, the estimated cost savings information)
included in the Prospectus (or, if the Prospectus is not
in existence, the most recent Preliminary Prospectus) are
based on or derived from sources which RSI believes to be
reliable and accurate.
(viii) Except as described in the Prospectus (or,
if the Prospectus is not in existence, the most recent
Preliminary Prospectus), there is not pending or, to the
knowledge of RSI, threatened, any action, suit,
proceeding, inquiry or investigation to which RSI or any
of its subsidiaries, or to which the property of RSI or
any of its subsidiaries is subject, before or brought by
any court or governmental agency or body, which would if
adversely determined have a Ralphs Material Adverse
Effect.
(ix) RSI and each of its subsidiaries (a) has good
and marketable title to all the real properties and other
material assets (personal, tangible, intangible or mixed)
owned by it, or purported to be owned by it, and, as of
the Closing Date such title will be free and clear of all
liens, except for liens which would be permitted under the
Indentures and (b) enjoys peaceful and undisturbed
possession under all leases to which it is a party as
lessee or sublessee, except for defects in title or lack
of possession that, in the aggregate, could not reasonably
be expected to have a Ralphs Material Adverse Effect. RSI
and each of its subsidiaries operates all material real
and personal property leased by it under valid and
enforceable leases and has performed in all material
respects the obligations required to be performed by it
with respect to each such lease except for such leases and
obligations which, in the aggregate, could not reasonably
be expected to have a Ralphs Material Adverse Effect. As
to leases with respect to which RSI or any of its
subsidiaries is the lessor, the lessees and other parties
under such leases are in compliance with all terms and
conditions thereunder and such leases are in full force
and effect except for any failures to comply or remain in
full force and effect which could not reasonably be
expected to have a Ralphs Material Adverse Effect. All
tangible assets and properties of RSI and its subsidiaries
are in good working order (subject to ordinary wear and
tear) and are adequate for the uses to which they are
being put or would be put in the ordinary course of
business except for such assets and properties as are not
material in the aggregate to the business, condition
(financial or otherwise) or results of operations of RSI
and its subsidiaries taken as a whole.
(x) RSI and its subsidiaries own, or are licensed
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under, and have the rights to use, all trademarks and
trade names (collectively, "Intellectual Property") used
in, or necessary for the conduct of, their businesses as
currently conducted, and the consummation of the
transactions contemplated hereby and by the Prospectus
(or, if the Prospectus is not in existence, the most
recent Preliminary Prospectus) will not alter or impair
any such rights. To the best of RSI's knowledge, no
claims have been asserted by any person to the use of any
such Intellectual Property or challenging or questioning
the validity or effectiveness of any license or agreement
related thereto. To the best of RSI's knowledge, there is
no valid basis for any such claim and the use of such
Intellectual Property by RSI and its subsidiaries does not
infringe on the rights of any person. RSI and each of its
subsidiaries has obtained all licenses, permits,
franchises and other governmental authorizations, the lack
of which would have a Ralphs Material Adverse Effect.
(xi) Subsequent to the respective dates as of
which information is given in the Prospectus (or, if the
Prospectus is not in existence, the most recent
Preliminary Prospectus) and except as described therein or
contemplated thereby, (x) none of RSI or any of its
subsidiaries has incurred any material liabilities or
obligations, direct or contingent, or entered into any
material transactions, not in the ordinary course of
business and (y) none of RSI or any of its subsidiaries
has purchased any of its respective outstanding capital
stock, nor declared, paid or otherwise made any dividend
or distribution of any kind on their respective capital
stock or otherwise.
(xii) All taxes, assessments, fees and other
charges (including, without limitation, withholding taxes,
penalties, and interest) due or claimed to be due from RSI
or any of its subsidiaries that are due and payable have
been paid, other than those being contested in good faith
or those currently payable without penalty or interest and
for which an adequate reserve or accrual has been
established in accordance with generally accepted
accounting principles, and except where the failure so to
pay is not reasonably likely to have, singly or in the
aggregate, a Ralphs Material Adverse Effect. RSI knows of
no actual or proposed additional tax assessments for any
fiscal period against RSI or any of its subsidiaries that,
singly or in the aggregate, is reasonably likely to have a
Ralphs Material Adverse Effect.
(xiii) Neither RSI nor any of its subsidiaries is
an "investment company" or a company "controlled by" an
"investment company" within the meaning of the Investment
Company Act of 1940, as amended.
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(xiv) Except as stated in the Prospectus (or, if
the Prospectus is not in existence, the most recent
Preliminary Prospectus), RSI does not know of any
outstanding claims for services, either in the nature of a
finder's fee, financial advisory fee, origination fee or
similar fee, with respect to the transactions contemplated
hereby.
(xv) RSI and each of its subsidiaries is in
compliance with all provisions of Section 517.075 of
Florida Statutes 1987, as amended.
(xvi) Except as stated in the Prospectus (or, if
the Prospectus is not in existence, the most recent
Preliminary Prospectus) neither RSI nor any of its
subsidiaries nor, to the best of their knowledge, any of
their respective directors, officers or controlling
persons has taken, directly or indirectly, any action
designed, or which might reasonably be expected, to cause
or result, under the Act or otherwise, in, or which has
constituted, stabilization or manipulation of the price of
any security of RSI or F4L or any of their respective
subsidiaries to facilitate the exchange offers
contemplated by the Transaction Documents and the
Prospectus (or, if the Prospectus is not in existence, the
most recent Preliminary Prospectus).
(xvii) Each of the representations and warranties
of RSI set forth in the Loan Agreement were true and
correct in all materials respects at the time as of which
such representations and warranties were made and will be
true and correct at and as of the Closing Date as if made
at and as of such date (other than to the extent any such
representation or warranty is expressly made as to only a
certain date).
(xviii) Each of the representations and warranties
of RSI set forth in Section 5(c) of the the Dealer Manager
Agreement were true and correct in all materials respects
at the time as of which such representations and
warranties were made and will be true and correct at and
as of the Closing Date as if made at and as of such date
(other than to the extent any such representation or
warranty is expressly made as to only a certain date).
Any certificate signed by any officer of Food 4 Less,
any Subsidiary Guarantor or RSI and delivered pursuant to this
Agreement or in connection with the payment of the purchase
price and delivery of the Securities shall be deemed a
representation and warranty by Food 4 Less, the Subsidiary
Guarantors or RSI to each Underwriter as to the matters covered
thereby, and shall not be deemed a representation by such
officer as an individual.
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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, Food 4 Less and the Subsidiary
Guarantors (and after giving effect to the Equity Mergers and
the Mergers, the Surviving Company and the Subsidiary
Guarantors) agree to issue and sell to the Underwriters, and
each of the Underwriters severally agrees to purchase from Food
4 Less and the Subsidiary Guarantors (and after giving effect
to the Equity Mergers and the Mergers, the Surviving Company
and the Subsidiary Guarantors), at ______% of their principal
amount, the respective aggregate principal amounts of the
Securities set forth opposite their respective names set forth
on Exhibit A hereto. The obligations of the Underwriters under
this Agreement are several and not joint. One or more
certificates in definitive form for the Securities that the
Underwriters have agreed to purchase hereunder, and in such
denomination or denominations and registered in such name or
names as each Underwriter requests upon notice to Food 4 Less
at least 48 hours prior to the Closing Date, shall be delivered
by or on behalf of the Underwriter, against payment by or on
behalf of the Underwriter of the purchase price therefor (less
an amount equivalent to payment of interest at the then
applicable Federal Funds Rate on the purchase price of the
Securities for one (1) day) by wire transfer or check of
immediately available funds to the account of Food 4 Less.
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 10005, at 10:00 A.M., New York time, on
__________, 1995, or at such other place, time or date as the
Underwriters and Food 4 Less may agree upon or as the
Underwriters may determine pursuant to Section 7(i) hereof,
such time and date of delivery against payment being herein
referred to as the "Closing Date." Food 4 Less will make such
certificate or certificates for the Securities available for
checking and packaging by the Underwriters at the offices in
New York, New York of BT Securities Corporation at least 24
hours prior to the Closing Date.
4. Offering by the Underwriters. After the
Registration Statement becomes effective, the Underwriters
propose to offer for sale to the public the Securities at the
price and upon the terms set forth in the Prospectus.
5. Certain Covenants. Each of Food 4 Less and each
Subsidiary Guarantor jointly and severally covenants and agrees
with the Underwriters that:
(i) Food 4 Less and each Subsidiary Guarantor
will use its respective best efforts to cause the
Registration Statement, if not effective at the time of
execution of this Agreement, and any amendments thereto,
to become effective promptly. If, at the time that the
Registration Statement becomes effective, any information
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shall have been omitted therefrom in reliance upon Rule
430A of the rules and regulations of the Commission under
the Act, then immediately following the execution of this
Agreement, Food 4 Less will prepare, and thereafter Food
4 Less will file or transmit for filing with the
Commission in accordance with such Rule 430A and Rule
424(b) of the rules and regulations of the Commission
under the Act, copies of an amended Prospectus, or, if
required by such Rule 430A, a post-effective amendment to
the Registration Statement (including an amended
Prospectus), containing all information so omitted. Food
4 Less will give each Underwriter notice of its intention
to file or prepare any amendment to the Registration
Statement (including any post-effective amendment) or any
amendment or supplement to the Prospectus (including any
revised prospectus which Food 4 Less proposes for use by
the Underwriters in connection with the offering of the
Securities which differs from the prospectus on file at
the Commission at the time the Registration Statement
becomes effective, whether or not such revised prospectus
is required to be filed pursuant to Rule 424(b) of the
rules any regulations of the Commission under the Act),
will furnish the Underwriters with copies of any such
amendment or supplement a reasonable amount of time prior
to such proposed filing or use, as the case may be, and
will not file any such amendment or supplement or use any
such prospectus to which the Underwriters or counsel for
the Underwriters shall reasonably object in writing or
which is not in compliance with the Act. Food 4 Less and
each Subsidiary Guarantor will advise the Underwriters,
promptly after any of them receives notice thereof, of the
time when the Registration Statement or any amendment
thereto has been filed or declared effective or the
Prospectus or any amendment or supplement thereto has been
filed and will provide evidence satisfactory to the
Underwriters of each such filing or effectiveness.
(ii) Food 4 Less and each Subsidiary Guarantor
will advise the Underwriters, promptly after receiving
notice or obtaining knowledge thereof, of (i) the issuance
by the Commission of any stop order suspending the
effectiveness of the Registration Statement or any
amendment thereto or any order preventing or suspending
the use of any Preliminary Prospectus or the Prospectus,
or any amendment or supplement thereto, (ii) the
suspension of the qualification of the Securities for
offering or sale in any jurisdiction, (iii) the
institution, threatening or contemplation of any
proceeding for any such purpose or (iv) any request made
by the Commission for amending the Registration Statement,
for amending or supplementing the Prospectus or for
additional information. Each of Food 4 Less and each
Subsidiary Guarantor will use its best efforts to prevent
the issuance of any such stop order and, if any such stop
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order is issued, to obtain the withdrawal thereof as
promptly as possible.
(iii) Food 4 Less and each Subsidiary Guarantor
(and after giving effect to the Equity Merger and the
Mergers, the Surviving Company and its subsidiaries) will
cooperate with the Underwriters in arranging for the
qualification of the Securities for offering and sale
under the securities or "Blue Sky" laws of such
jurisdictions as the Underwriters may designate and will
continue such qualifications in effect for as long as may
be necessary to complete the initial distribution of the
Securities by the Underwriters; provided, however, that in
connection therewith neither Food 4 Less nor any
Subsidiary Guarantor (nor after giving effect to the
Equity Merger and the Mergers, the Surviving Company and
its subsidiaries) shall be required to qualify as a
foreign corporation or to execute a general consent to
service of process in any jurisdiction or, except at the
expense of the Underwriters, to keep any state
qualification effective after one year.
(iv) If any event shall occur as a result of
which it is necessary, in the opinion of counsel for the
Underwriters, to amend or supplement the Prospectus in
order to make the Prospectus not misleading in light of
the circumstances existing at the time it is delivered to
a purchaser, or if for any other reason it shall be
necessary to amend or supplement the Prospectus in order
to comply with the Act and the Exchange Act, Food 4 Less
(or, after giving effect to the Equity Merger and the
Mergers, the Surviving Company) shall (subject to Section
5(i)) forthwith amend or supplement the Prospectus (in
form and substance reasonable satisfactorily to counsel
for the Underwriters and in compliance with the Act) so
that, as so amended or supplemented, the Prospectus will
not include an untrue statement of a material fact or omit
to state a material fact necessary in order to make the
statements therein, in light of the circumstances existing
at the time it is delivered to a purchaser, not misleading
and will comply with the Act and the Exchange Act, and
Food 4 Less (or, after giving effect to the Equity Merger
and the Mergers, the Surviving Company) will furnish to
the Underwriters a reasonable number of copies of such
amendment or supplement.
(v) Food 4 Less (or, after giving effect to the
Equity Merger and the Mergers, the Surviving Company) and
the Subsidiary Guarantors will, without charge, provide
(a) to each Underwriter and to counsel for the
Underwriters a signed copy of the registration statement
originally filed with respect to the Securities and each
amendment thereto (in each case including exhibits
thereto) and (b) so long as a prospectus relating to the
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Securities is required to be delivered under the Act, as
many copies of each Preliminary Prospectus or the
Prospectus or any amendment or supplement thereto as the
Underwriters may reasonably request.
(vi) Food 4 Less (and after giving effect to
the Equity Merger and the Mergers, the Surviving Company)
will make generally available to its security holders as
soon as practicable, but not later than 90 days after the
close of the period covered thereby, an earnings statement
(in form complying with the provisions of Rule 158 of the
rules and regulations of the Commission under the Act)
covering a twelve-month period beginning not later than
the first day of the fiscal quarter of Food 4 Less, next
following the "effective date" (as defined in Rule 158) of
the Registration Statement.
(vii) If, prior to the completion of the
distribution of the Securities Food 4 Less (or after
giving effect to the Equity Merger and the Mergers, the
Surviving Company), or any of its subsidiaries, commences
engaging in business with the government of Cuba or with
any person or affiliate located in Cuba after the date the
Registration Statement becomes or has become effective
with the Commission or with the Florida Department of
Banking and Finance (the "Department"), whichever date is
later, or if the information reported in the Prospectus,
if any, concerning the business of Food 4 Less (or after
giving effect to the Equity Merger and the Mergers, the
Surviving Company) or any of its subsidiaries with Cuba or
with any person or affiliate located in Cuba changes in
any material way, Food 4 Less will provide the Department
notice of such business or change, as appropriate, in a
form acceptable to such Department.
(viii) Food 4 Less (or, after giving effect to
the Equity Merger and the Mergers, the Surviving Company)
will apply the net proceeds from the sale of the
Securities as set forth under "Use of Proceeds" in the
Prospectus.
(ix) Prior to the Closing Date, Food 4 Less
will furnish to the Underwriters, as soon as they have
been prepared by or are available to Food 4 Less, a copy
of any unaudited interim consolidated financial statements
of Food 4 Less and its subsidiaries, for any period
subsequent to the period covered by the most recent
financial statements appearing in the Registration
Statement and Prospectus.
6. Expenses. Food 4 Less and the Subsidiary
Guarantors (and after giving effect to the Equity Merger and
the Mergers, the Surviving Company and the Subsidiary
Guarantors) jointly and severally agree to pay all costs and
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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 10 hereof,
including all costs and expenses incident to (i) the printing,
word processing or other production of documents with respect
to such transactions, including any costs of printing the
registration statement originally filed with respect to the
Securities and any amendment thereto, any Preliminary
Prospectus and the Prospectus and any amendment or supplement
thereto, and any "Blue Sky" memoranda, (ii) all arrangements
relating to the delivery to the Underwriters of copies of the
foregoing documents, (iii) the fees and disbursements of the
counsel, the accountants and any other experts or advisors
retained by Food 4 Less or any Subsidiary Guarantor, (iv) the
preparation, issuance and delivery to the Underwriters of any
certificates evidencing the Securities and the Guarantees,
including trustees' fees, (v) the qualification of the
Securities under state securities and "Blue Sky" laws,
including filing fees and reasonable fees and disbursements of
counsel for the Underwriters relating thereto, (vi) the filing
fees of the Commission and the National Association of
Securities Dealers, Inc. relating to the Securities,
(vii) expenses of Food 4 Less and the Subsidiary Guarantors in
connection with any meetings with prospective investors in the
Securities, (viii) fees and expenses of the Trustees including
fees and expenses of their counsel, (ix) advertising relating
to the offering of the Securities (other than as shall have
been specifically approved by the Underwriters to be paid for
by the Underwriters), and (x) any fees charged by investment
rating agencies for the rating of the Securities. If the sale
of the Securities provided for herein is not consummated
because any condition to the obligations of the Underwriters
set forth in Section 7 hereof is not satisfied, because this
Agreement is terminated pursuant to Section 10(a)(i) hereof or
because of any failure, refusal or inability on the part of
Food 4 Less or any Subsidiary Guarantor (or, after giving
effect to the Equity Merger and the Mergers, the Surviving
Company and to Subsidiary Guarantors) to perform all
obligations and satisfy all conditions on their part to be
performed or satisfied hereunder other than by reason of a
default by the Underwriters, Food 4 Less or the Subsidiary
Guarantors (or after giving effect to the Equity Merger and the
Mergers, the Surviving Company and the Subsidiary Guarantors)
will reimburse the Underwriters upon demand for all
out-of-pocket expenses (including reasonable counsel fees and
disbursements) that shall have been incurred by the
Underwriters in connection with the proposed purchase and sale
of the Securities.
7. Conditions of the Underwriters' Obligations.
The obligation of the Underwriters to purchase and pay for the
Securities are subject to the accuracy of the representations
and warranties contained herein, to the performance by Food 4
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Less and each Subsidiary Guarantor (and, after giving effect to
the Equity Merger and the Mergers, the Surviving Company and
the Subsidiary Guarantors) and RSI of their respective
covenants and agreements hereunder and to the following
additional conditions:
(i) If the registration statement originally filed
with respect to the Securities or any amendment thereto
filed prior to the Closing Date has not been declared
effective as of the time of execution hereof, the
Registration Statement or such amendment shall have been
declared effective not later than 12:00 noon, New York
City time, on the date on which the amendment to the
registration statement originally filed with respect to
the Securities or to the Registration Statement, as the
case may be, containing information regarding the initial
public offering price of the Securities has been filed
with the Commission, or such later time and date as shall
have been consented to by the Underwriters; if required,
the Prospectus and any amendment or supplement thereto
shall have been filed in accordance with Rule 424(b) under
the Act; no stop order suspending the effectiveness of the
Registration Statement or any amendment thereto or the
qualification of either Indenture under the Trust
Indenture Act shall have been issued and no proceedings
for that purpose shall have been instituted or threatened
or, to the knowledge of Food 4 Less, any Subsidiary
Guarantor or the Underwriters, shall be contemplated by
the Commission; and the Underwriters shall have received a
certificate, with respect to Food 4 Less and each
Subsidiary Guarantor, dated the Closing Date and signed by
the Chairman, Vice Chairman, President, a Senior Vice
President or a Vice President of Food 4 Less (who may rely
upon the best of his information and belief), to that
effect.
(ii) The Underwriters shall have received opinions
in form and substance satisfactory to the Underwriters,
dated the Closing Date, of (a) Latham & Watkins, special
counsel for Food 4 Less and each Subsidiary Guarantor,
substantially in the form of Exhibit B hereto, (b) Irwin,
Clutter & Severson, special Kansas counsel to Food 4 Less
and each Subsidiary Guarantor, substantially in the form
of Exhibit C hereto, and (c) the opinion of the Senior
Vice President, General Counsel and Secretary of RSI,
substantially in the form of Exhibit D hereto.
(iii) The Underwriters shall have received an
opinion, dated the Closing Date, of Cahill Gordon &
Reindel, counsel for the Underwriters, with respect to the
sufficiency of certain corporate proceedings and other
legal matters relating to this Agreement, and such other
related matters as the Underwriters may require. In
rendering such opinion, Cahill Gordon & Reindel shall have
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received and may rely upon such certificates and other
documents and information as they may reasonably request
to pass upon such matters. In addition, in rendering
their opinion, Cahill Gordon & Reindel may state that
their opinion is limited to matters of New York, Delaware
corporate and federal law.
(iv) The Underwriters shall have received, from
Arthur Andersen LLP, independent public accountants for
Food 4 Less and the Subsidiary Guarantors, letters dated,
respectively, the date hereof and the Closing Date, in
form and substance satisfactory to the Underwriters and
Cahill Gordon & Reindel, counsel for the Underwriters.
(v) The Underwriters shall have received from KPMG
Peat Marwick, independent public accountants for RSI and
RGC, letters dated, respectively, the date hereof and the
Closing Date, in form and substance satisfactory to the
Underwriters and Cahill Gordon & Reindel, counsel for the
Underwriters.
(vi) The representations and warranties of RSI, Food
4 Less and each Subsidiary Guarantor contained in this
Agreement shall be true and correct in all material
respects on and as of the Closing Date (other than to the
extent any such representation or warranty is expressly
made as to a certain date); RSI, Food 4 Less and each
Subsidiary Guarantor shall have complied with all
agreements and satisfied all conditions on their part to
be performed or satisfied hereunder at or prior to the
Closing Date; and subsequent to the date of the most
recent financial statements in the Prospectus, there shall
have been no material adverse change in the business,
condition (financial or other) or results of operations of
either (i) RSI and its subsidiaries taken as a whole or
(ii) Food 4 Less and its subsidiaries taken as a whole
(each a "Material Adverse Change"), or any development
involving a prospective Material Adverse Change, except as
set forth in, or contemplated by, the Registration
Statement and the Prospectus.
(vii) None of the issuance and sale of the
Securities pursuant to this Agreement, the Equity Merger,
the Mergers or any of the other transactions contemplated
by any of the Transaction Documents or the Prospectus
shall be enjoined (temporarily or permanently) and no
restraining order or other injunctive order shall have
been issued or any action, suit or proceeding shall have
been commenced with respect to this Agreement, the Dealer
Manager Agreement, the Merger Agreement, the Loan
Agreement the Equity Merger, the Mergers or any of the
other transactions contemplated by the Prospectus, before
any court or governmental authority.
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(viii) The Underwriters shall have received a
certificate, dated the Closing Date, of the Vice Chairman,
President or any Vice President (and with respect to (B)
below, the Chief or Principal Financial Officer) of Food 4
Less to the effect that:
(A) The representations and warranties of
Food 4 Less and each Subsidiary Guarantor in this
Agreement are true and correct as if made on and as
of the Closing Date, and Food 4 Less and each
Subsidiary Guarantor has performed all covenants and
agreements and satisfied all conditions on its part
to be performed or satisfied at or prior to the
Closing Date after giving effect to the Merger, the
Equity Merger at the other transactions contemplated
hereby, by the Transaction Documents and the
Prospectus;
(B) No stop order suspending the
effectiveness of the Registration Statement or any
amendment thereto or the qualification of either
Indenture under the Trust Indenture Act has been
issued, and no proceedings for those purposes have
been instituted or threatened or, to the best of Food
4 Less' and each Subsidiary Guarantor's knowledge, as
the case may be, are contemplated by the Commission;
(C) Subsequent to the respective dates as
of which information is given in the Registration
Statement and the Prospectus, there has not been any
material adverse change or any developments involving
a prospective material adverse change in the
business, condition (financial or other) or results
of operations of Food 4 Less and its subsidiaries (or
after giving effect to the Equity Merger and the
Mergers, the Surviving Company and its subsidiaries)
taken as a whole;
(D) Neither the sale of the Securities by
the Surviving Company hereunder nor the issuance of
the Guarantees by the Subsidiary Guarantors nor any
of the other transactions contemplated hereby, by the
Transaction Documents or by the Prospectus has been
enjoined (temporarily or permanently);
(E) There have been no material
amendments, alterations, modifications, or
waivers of any provisions of any of the Transaction
Documents since the date of the execution
and delivery thereof by the parties thereto;
and
(F) Food 4 Less and the Subsidiary
Guarantors, to the extent each is a party thereto,
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have complied in all material respects with all
agreements and covenants in the Transaction Documents
and performed in all material respects all conditions
specified therein contemplated by the Prospectus to
be complied with or performed by them at or prior to
the Closing.
(ix) On the Closing Date, the Underwriters shall
have received a certificate, dated such date, of the Vice
Chairman, President or any Vice President (and with
respect to (B) below the Chief or Principal Financial
Officer) of RSI to the effect that:
(A) The representations and warranties of RSI
in this Agreement are true and correct in all
material respects as if made on and as of the Closing
Date, and RSI and its subsidiaries have performed all
covenants and agreements and satisfied all conditions
on their part to be performed or satisfied at or
prior to the Closing Date after giving effect to the
Merger, the Equity Merger and the other transactions
contemplated hereby, by the Transaction Documents and
by the Prospectus;
(B) Subsequent to the date as of which
information is given in the Prospectus, there has not
been any material adverse change, or any developments
involving a prospective material adverse change, in
the business, condition (financial or other) or
results of operations of RSI and its subsidiaries
taken as a whole; and
(C) RSI and its subsidiaries have complied in
all material respects with all agreements and
covenants in the Transaction Documents, to the extent
each is a party thereto, and performed in all
material respects all conditions specified therein
contemplated by the Prospectus to be complied with or
performed by them at or prior to the Closing.
(x) On the Closing Date, the Underwriters shall have
received (i) a letter, dated the Closing Date, from
Houlihan, Lokey, Howard & Zukin, Inc. with respect to the
solvency of the Surviving Company and its subsidiaries in
form, scope and substance satisfactory to the Underwriters
and (ii) environmental audit reports in form, scope and
substance satisfactory to the Underwriters.
(xi) On the Closing Date, Food 4 Less, the
Subsidiary Guarantors and RSI shall have, to the extent
each is a party thereto, complied in all material respects
with all agreements and covenants in the Transaction
Documents and performed all conditions specified therein
(other than agreements or covenants which have been waived
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but only if such waivers are not required to be set forth
in the Prospectus) to be complied with or performed at or
prior to the Closing, and each of the Transaction
Documents shall be in full force and effect.
(xii) On the Closing Date, the Underwriters shall
have received copies of all certificates, documents and
opinions delivered by RSI, F4L, Holdings, the Issuers, or
any of their counsels and such other certificates,
documents and opinions reasonably obtainable by RSI, F4L,
Holdings or the Issuers under the Transaction Documents in
connection with the Mergers and the financing (as defined
in the Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus)),
together with letters addressed to the Underwriters,
stating that the Underwriters may rely on such
certificates and opinions as if they had been addressed to
the Underwriters.
(xiii) The Equity Merger shall have been consummated
on the terms and conditions set forth in the Prospectus.
(xiv) On the Closing Date:
(1) the Certificates of Merger with respect to
the Mergers shall be in form and substance
satisfactory to the Underwriters and Cahill Gordon &
Reindel, counsel for the Underwriters, shall have
been pre-cleared for filing with the Secretary of
State of the State of Delaware and shall be ready in
all respects for filing immediately upon consummation
of each of the transactions contemplated by the
Prospectus to be consummated prior to the Mergers;
(2) the Loan Agreement with aggregate
commitments thereunder of not less than
$1,075,000,000 shall be in full force and effect, no
event shall have occurred and no event shall have
failed to occur, which would relieve the lenders
under the New Credit Facility (the "Lenders") of
their obligation to advance funds, or preclude them
from advancing funds to Food 4 Less thereunder, and
concurrently with the Closing the Lenders shall have
advanced funds under the New Credit Facility in an
amount at least equal to $750,000,000 under the term
loan facilities and such additional amounts under the
revolving credit facility as are necessary to fund
the Mergers and related transactions and there shall
be a sufficient amount available under the term loan
facilities for a period of at least ninety days
following the Closing Date to fund the Change of
Control Offers (as defined in the Prospectus (or, if
the Prospectus is not in existence, the most recent
Preliminary Prospectus));
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(3) New Holdings shall have received at least
$140,000,000 in cash from institutional investors as
consideration for the issuance and sale by New
Holdings of shares of capital stock of New Holdings
on the terms and conditions described in the
Prospectus (or if the Prospectus is not in existence,
the most recent Preliminary Prospectus); New Holdings
shall have purchased at least 48% of the outstanding
common stock of RSI with $100,000,000 of the proceeds
of such issuance, $131,500,000 aggregate principal
amount of its 13 5/8% Senior Subordinated Pay In Kind
Debentures due 2007 (the "Seller Debentures") and
$18,500,000 aggregate accreted value of its 13 5/8%;
Senior Discount Notes due 2005 (the "Discount
Debentures"), all as described in the Prospectus (or,
if the Prospectus is not in existence, the most
recent Preliminary Prospectus). New Holdings shall
have contributed such common stock of RSI, together
with $12.1 million of the proceeds of the New Equity
Investment to the capital of Food 4 Less. New
Holdings shall have received at least $59,000,000 in
cash from institutional investors as consideration
for the issuance and sale by New Holdings to such
institutional investors of $59,000,000 aggregate
principal amount of the Discount Debentures, all as
described in the Prospectus (or if the Prospectus is
not in existence, the most recent Preliminary
Prospectus). New Holdings shall have issued
(i) $20,000,000 principal amount of Discount
Debentures to The Yucaipa Companies in satisfaction
of certain fees payable by the Company to The Yucaipa
Companies in connection with the Mergers and
(ii) $2.5 million principal amount of Discount
Debentures to Apollo Advisers, L.P. in consideration
of certain fees payable by New Holdings to Apollo
Advisors, L.P. in connection with the Mergers, all as
set forth in the Prospectus (or, if the Prospectus is
not in existence, the most recent Preliminary
Prospectus). New Holdings and Food 4 Less shall have
the issued, authorized and outstanding capitalization
set forth in the Prospectus.
(4) All conditions to the consummation of the
Exchange Offers (as defined in the Dealer Manager
Agreement) including the conditions contained in
Section 6 of the Dealer Manager Agreement shall have
been satisfied without waiver and all other
transactions contemplated by the Prospectus (or, if
the Prospecuts is not in existence, the most recent
Preliminary Prospectus) to be consummated at or prior
to the consummation of the Mergers shall have been
consummated.
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(xv) Simultaneously with the Closing, (w) the
Exchange Offers shall have been consummated as
contemplated by the Prospectus (or, if the Prospectus is
not in existence, the most recent Preliminary Prospectus)
and the Dealer Manager Agreement, (x) the closing
contemplated by the Merger Agreement, including without
limitation the Mergers, shall have been consummated in
accordance with the terms of the Merger Agreement,
(y) immediately following consummation of the Mergers, the
Subsequent Merger shall have been consummated in
accordance with the terms described in the Prospectus and
(z) Crawford Stores, Inc., (if at the time a subsidiary of
the Surviving Company will) execute and deliver the
Supplemental Indentures, in form and substance
satisfactory to the Underwriters and Cahill Gordon &
Reindel, counsel for the Underwriters, with respect to the
Securities.
On or before the Closing Date, the Underwriters and
counsel for the Underwriters shall have received such further
documents, opinions, certificates and schedules or instruments
relating to the business, corporate, legal and financial
affairs of Food 4 Less and the Subsidiary Guarantors and RSI
and its subsidiaries as they shall have heretofore reasonably
requested from Food 4 Less and the Subsidiary Guarantors.
All such opinions, certificates, letters, schedules,
documents or instruments delivered pursuant to this Agreement
will comply with the provisions hereof only if they are
reasonably satisfactory in all material respects to the
Underwriters and counsel for the Underwriters. Food 4 Less and
the Subsidiary Guarantors and RSI and its subsidiaries shall
furnish to the Underwriters such conformed copies of such
opinions, certificates, letters, schedules, documents and
instruments in such quantities as the Underwriters shall
reasonably request.
8. Indemnification and Contribution. (a) Each of
Food 4 Less and each Subsidiary Guarantor (and, after giving
effect to the Equity Merger and the Mergers, the Surviving
Company and each Subsidiary Guarantors) jointly and severally
agrees to indemnify and hold harmless each Underwriter, and
each person, if any, who controls either of the Underwriters
within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act, against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter or
such controlling person may become subject under the Act, the
Exchange Act or otherwise, insofar as any such losses, claims,
damages or liabilities (or actions in respect thereof) arise
out of or are based upon:
(i) any untrue statement or alleged untrue statement
of any material fact contained in (A) the registration
statement originally filed with respect to the Securities
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or any amendment thereto or any Preliminary Prospectus or
the Prospectus or any amendment or supplement thereto or
(B) any application or other document, or any amendment or
supplement thereto, executed by Food 4 Less or any
Subsidiary Guarantor (or, after giving effect to the
Equity Merger and the Mergers, the Surviving Company or
any Subsidiary Guarantor) or based upon written
information furnished by or on behalf of Food 4 Less or
any Subsidiary Guarantor (or, after giving effect to the
Equity Merger and the Mergers, the Surviving Company or
any Subsidiary Guarantor) filed in any jurisdiction in
order to qualify the Securities under the securities or
"Blue Sky" laws thereof or filed with the Commission or
any securities association or securities exchange (each an
"Application") or
(ii) the omission or alleged omission to state, in
such registration statement or any amendment thereto, any
Preliminary Prospectus or the Prospectus or any amendment
or supplement thereto, or any Application, a material fact
required to be stated therein or necessary to make the
statements therein not misleading,
and will reimburse, as incurred, each Underwriter and each such
controlling person for any legal or other expenses reasonably
incurred by the Underwriters or such controlling person in
connection with investigating, defending against or appearing
as a third-party witness in connection with any such loss,
claim, damage, liability or action; provided, however, that
neither Food 4 Less nor any of the Subsidiary Guarantors will
be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon any
untrue statement or alleged untrue statement or omission or
alleged omission made in such registration statement or any
amendment thereto, any Preliminary Prospectus or the Prospectus
or any amendment or supplement thereto, or any Application in
reliance upon and in conformity with written information
furnished to Food 4 Less or any Subsidiary Guarantor (or, after
giving effect to the Equity Merger and the Mergers, the
Surviving Company or any Subsidiary Guarantor) by any of the
Underwriters specifically for use therein; and provided,
further, that neither Food 4 Less nor any Subsidiary Guarantor
will be liable to the Underwriters or any person controlling
any of the Underwriters with respect to any such untrue
statement or omission made in any Preliminary Prospectus that
is corrected in the Prospectus (or any amendment or supplement
thereto) if the person asserting any such loss, claim, damage
or liability purchased Securities from the Underwriters in
reliance upon the Preliminary Prospectus but was not sent or
given a copy of the Prospectus (as amended or supplemented) at
or prior to the written confirmation of the sale of such
Securities to such person in any case where such delivery of
the Prospectus (as so amended or supplemented) is required by
the Act, unless such failure to deliver this Prospectus (as
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amended or supplemented) was a result of noncompliance by Food
4 Less or any Subsidiary Guarantor with Section 5(v)(b) of this
Agreement. This indemnity agreement will be in addition to any
liability that Food 4 Less or any Subsidiary Guarantor may
otherwise have to the indemnified parties. Neither Food 4 Less
nor any Subsidiary Guarantor (nor, after giving effect to the
Equity Merger and the Mergers, the Surviving Company nor the
Subsidiary Guarantors) will, without the prior written consent
of the Underwriters, settle or compromise or consent to the
entry of any judgment in any pending or threatened claim,
action, suit or proceeding in respect of which indemnification
from the Underwriters may be sought hereunder (whether or not
the Underwriters or any person who controls either of the
Underwriters within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act is a party to such claim,
action, suit or proceeding), unless such settlement, compromise
or consent includes an unconditional release of the
Underwriters and each such controlling person from all
liability arising out of such claim, action, suit or
proceeding.
(b) Each Underwriter will severally and not jointly
indemnify and hold harmless Food 4 Less, each Subsidiary
Guarantor (or, after giving effect to the Equity Merger and the
Mergers, the Surviving Company and the Subsidiary Guarantors),
their respective directors, their respective officers who
signed the Registration Statement and each person, if any, who
controls Food 4 Less or any Subsidiary Guarantor 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
Food 4 Less or any Subsidiary Guarantor (or, after giving
effect to the Equity Merger and the Mergers, the Surviving
Company and the Subsidiary Guarantors) or any such director,
officer or controlling person may become subject under the Act,
the Exchange Act, or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise
out of or are based upon (i) any untrue statement or alleged
untrue statement of any material fact contained in the
Registration Statement or any amendment thereto, any
Preliminary Prospectus or the Prospectus or any amendment or
supplement thereto, or any Application or (ii) the omission or
the alleged omission to state therein a material fact required
to be stated in the Registration Statement or any amendment
thereto, any Preliminary Prospectus or the Prospectus or any
amendment or supplement thereto, or any Application, or
necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity
with written information furnished to Food 4 Less or any
Subsidiary Guarantor by the Underwriters specifically for use
therein; and, subject to the limitation set forth immediately
preceding this clause, will reimburse, as incurred, any legal
or other expenses reasonably incurred by Food 4 Less or any
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Subsidiary Guarantor (or, after giving effect to the Equity
Merger or the Mergers, the Surviving Company or any Subsidiary
Guarantor) or any such director, officer or controlling person
in connection with investigating or defending against or
appearing as a third-party witness in connection with any such
loss, claim, damage, liability or action in respect thereof.
This indemnity agreement will be in addition to any liability
that the Underwriters may otherwise have to the indemnified
parties. The Underwriters will not, without the prior written
consent of Food 4 Less and any affected Subsidiary Guarantor
(or, after giving effect to the Equity Merger and the Mergers,
the Surviving Company or any affected Subsidiary Guarantor),
settle or compromise or consent to the entry of any judgment in
any pending or threatened claim, action, suit or proceeding in
respect of which indemnification from Food 4 Less or any
affected Subsidiary Guarantor (or, after giving effect to the
Equity Merger and the Mergers, the Surviving Company or any
affected Subsidiary Guarantor) may be sought hereunder (whether
or not Food 4 Less or any such affected Subsidiary Guarantor or
any person who controls Food 4 Less or any such affected
Subsidiary Guarantor within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act is a party to such claim,
action, suit or proceeding), unless such settlement, compromise
or consent includes an unconditional release of Food 4 Less or
any such affected Subsidiary Guarantor and each such
controlling person from all liability arising out of such
claim, action, suit or proceeding.
(c) Promptly after receipt by an indemnified party
under this Section 8 of notice of the commencement of any
action, such indemnified party will, if a claim in respect
thereof is to be made against the indemnifying party under this
Section 8, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party
will not relieve it from any liability which it may have to any
indemnified party otherwise than under this Section 8. 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 satisfactory to such indemnified party;
provided, however, that if the defendants in any such action
include both the indemnified party and the indemnifying party
and the indemnified party shall have reasonably concluded that
there may be one or more legal defenses available to it and/or
other indemnified parties that are different from or additional
to those available to the indemnifying party, then the
indemnifying party shall not have the right to direct the
defense of such action on behalf of such indemnified party or
parties and such indemnified party or parties shall have the
right to select separate counsel to defend such action on
behalf of such indemnified party or parties. After notice from
the indemnifying party to such indemnified party of its
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41
election so to assume the defense thereof and approval by such
indemnified party of counsel appointed to defend such action,
the indemnifying party will not be liable to such indemnified
party under this Section 8 for any legal or other expenses,
other than reasonable costs of investigation, subsequently
incurred by such indemnified party in connection with the
defense thereof, unless (i) the indemnified party shall have
employed separate counsel in accordance with the proviso to the
immediately preceding sentence (it being understood, however,
that in connection with such action the indemnifying party
shall not be liable for the expenses of more than one separate
counsel (in addition to local counsel) in any one action or
separate but substantially similar actions in the same
jurisdiction arising out of the same general allegations or
circumstances, designated by the Underwriters in the case of
paragraph (a) of this Section 8 or Food 4 Less and the
Subsidiary Guarantors (or, after giving effect to the Equity
Merger and the Mergers, the Surviving Company and the
Subsidiary Guarantors) in the case of paragraph (b) of this
Section 8, representing the indemnified parties under such
paragraph (a) or paragraph (b), as the case may be, who are
parties to such action or actions) or (ii) the indemnifying
party has authorized the employment of counsel for the
indemnified party at the expense of the indemnifying party.
After such notice from the indemnifying party to such
indemnified party, the indemnifying party will not be liable
for the costs and expenses of any settlement of such action
effected by such indemnified party without the consent of the
indemnifying party, unless such indemnified party waived its
rights under this Section 8, in which case the indemnified
party may effect such a settlement without such consent.
(d) In circumstances in which the indemnity
agreement provided for in the preceding paragraphs of this
Section 8 is unavailable or insufficient to hold harmless an
indemnified party in respect of any losses, claims, damages or
liabilities (or actions in respect thereof), each indemnifying
party, in order to provide for just and equitable contribution,
shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages
or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect (i) the relative
benefits received by the indemnifying party or parties on the
one hand and the indemnified party on the other from the
offering of the Securities or (ii) if the allocation provided
by the foregoing clause (i) is not permitted by applicable law,
not only such relative benefits but also the relative fault of
the indemnifying party or parties on the one hand and the
indemnified party on the other in connection with the
statements or omissions or alleged statements or omissions that
resulted in such losses, claims, damages or liabilities (or
actions in respect thereof). The relative benefits received by
Food 4 Less and the Subsidiary Guarantors (and, after giving
effect to the Equity Merger and the Mergers, the Surviving
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Company and the Subsidiary Guarantors) on the one hand and the
Underwriters on the other shall be deemed to be in the same
proportion as the total proceeds from the offering (before
deducting expenses other than underwriting discounts and
commissions) received by Food 4 Less (or, after giving effect
to the Equity Merger and the Mergers, the Surviving Company)
bear to the total underwriting discounts and commissions
received by the Underwriters. The relative fault of the
parties shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a
material fact relates to information supplied by Food 4 Less or
the Subsidiary Guarantors (or, after giving effect to the
Equity Merger and the Mergers, the Surviving Company or the
Subsidiary Guarantor) on the one hand, or the Underwriters on
the other, the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such
statement or omission, and any other equitable considerations
appropriate in the circumstances. Food 4 Less, each Subsidiary
Guarantor and the Underwriters agree that it would not be
equitable if the amount of such contribution were determined by
pro rata or per capita allocation (even if Food 4 Less and the
Subsidiary Guarantors on the one hand and the Underwriters on
the other hand were treated as one entity for such purpose) or
by any other method of allocation that does not take into
account the equitable considerations referred to in the first
sentence of this paragraph (d). Notwithstanding any other
provision of this paragraph (d), the Underwriters shall not be
obligated to make contributions hereunder that in the aggregate
exceed the total underwriting discounts and commissions
received by the Underwriters under this Agreement, less the
aggregate amount of any damages that the Underwriters have
otherwise been required to pay by reason of the untrue or
alleged untrue statements or the omissions or alleged omissions
to state a material fact, and no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the
Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. For purposes
of this paragraph (d), each person, if any, who controls either
of the Underwriters within the meaning of Section 15 of the Act
or Section 20 of the Exchange Act shall have the same rights to
contribution as the Underwriters, and each director of Food 4
Less and each Subsidiary Guarantor, each officer of Food 4 Less
and each Subsidiary Guarantor who signed the Registration
Statement and each person, if any, who controls Food 4 Less and
each such Subsidiary Guarantor within the meaning of Section 15
of the Act of Section 20 of the Exchange Act, shall have the
same rights to contribution as Food 4 Less and each such
Subsidiary Guarantor.
9. Survival Clause. The respective
representations, warranties, agreements, covenants, indemnities
and other statements of Food 4 Less, RSI and each Subsidiary
Guarantor, their respective officers and the Underwriters set
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forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement shall remain in full
force and effect, regardless of (i) any investigation made by
or on behalf of Food 4 Less or any Subsidiary Guarantor, any of
their respective officers or directors, the Underwriters or any
controlling person referred to in Section 8 hereof and
(ii) delivery of and payment for the Securities. The
respective agreements, covenants, indemnities and other
statements set forth in Sections 6 and 8 hereof shall remain in
full force and effect, regardless of any termination or
cancellation of this Agreement.
10. Termination. (a) This Agreement may be
terminated in the sole discretion of the Underwriters by notice
to Food 4 Less and the Subsidiary Guarantors given prior to the
Closing Date in the event that Food 4 Less or any Subsidiary
Guarantor (or, after giving effect to the Equity Merger and the
Mergers, the Surviving Company or the Subsidiary Guarantors)
shall have failed, refused or been unable to perform all
obligations and satisfy all conditions on their respective part
to be performed or satisfied hereunder at or prior thereto or,
if at or prior to the Closing Date:
(i) Food 4 Less or any Subsidiary Guarantor shall
have sustained any loss or interference with respect to
its businesses or properties from fire, flood, hurricane,
earthquake, accident or other calamity, whether or not
covered by insurance, or from any labor dispute or any
legal or governmental proceeding, which loss or
interference has had or has a material adverse effect on
the business, condition (financial or other) or results of
operations of Food 4 Less (and, after giving effect to the
Equity Merger and the Mergers, the Surviving Company) and
its subsidiaries taken as a whole, or there shall have
been any material adverse change, or any development
involving a prospective material adverse change (including
without limitation a change in management or control of
Food 4 Less or any Subsidiary Guarantor), in the business,
condition (financial or other), or results of operations
of Food 4 Less (and, after giving effect to the Equity
Merger and the Mergers, the Surviving Company) and its
subsidiaries taken as a whole, except as described in or
contemplated by the Prospectus (exclusive of any amendment
or supplement thereto);
(ii) trading in securities generally on the New York
or American Stock Exchange shall have been suspended or
minimum or maximum prices shall have been established on
any such exchange;
(iii) a banking moratorium shall have been declared
by New York or United States authorities; or
(iv) there shall have been (A) an outbreak or
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escalation of hostilities between the United States and
any foreign power, (B) an outbreak or escalation of any
other insurrection or armed conflict involving the United
States or (c) any material change in the financial markets
of the United States which, in the sole judgment of the
Underwriters, makes it impracticable or inadvisable to
proceed with the public offering or the delivery of the
Securities as contemplated by the Registration Statement,
as amended as of the date hereof.
(b) Termination of this Agreement pursuant to this
Section 10 shall be without liability of any party to any other
party except as provided in Section 9 hereof.
11. Notices. All communications hereunder shall be
in writing and, if sent to the Underwriters, shall be mailed or
delivered or telecopied and confirmed in writing to the
Underwriters c/o BT Securities Corporation, One Bankers Trust
Plaza, New York, New York 10005, Attention: Lori Finkel, and
with a copy to Cahill Gordon & Reindel, 80 Pine Street, New
York, New York 10005, Attention: William M. Hartnett, Esq. If
sent to Food 4 Less or any Subsidiary Guarantor, shall be
mailed, delivered or telegraphed and confirmed in writing to
Food 4 Less or such Subsidiary Guarantor c/o Food 4 Less, Inc.,
777 South Harbor Boulevard, La Habre, California 90631,
Attention: Mark A. Resnik, Esq., Vice President and Secretary
with a copy to Latham & Watkins, 633 West Fifth Street, suite
4000, Los Angeles, California 90071, Attention: Pamela Kelly,
Esq.
12. Successors. This Agreement shall inure to the
benefit of and be binding upon the Underwriters, Food 4 Less,
each Subsidiary Guarantor 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 Food 4 Less and
each Subsidiary Guarantor contained in Section 8 of this
Agreement shall also be for the benefit of any person or
persons who control the Underwriters within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act and
(ii) the indemnities of the Underwriters contained in Section 8
of this Agreement shall also be for the benefit of the
directors of Food 4 Less and each Subsidiary Guarantor, their
respective officers who have signed the Registration Statement
and any person or persons who control Food 4 Less or any
Subsidiary Guarantor within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act. No purchaser of
Securities from the Underwriters will be deemed a successor
because of such purchase.
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13. APPLICABLE LAW. THE VALIDITY AND INTERPRETATION
OF THIS AGREEMENT, AND THE TERMS AND CONDITIONS SET FORTH
HEREIN SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO ANY
PROVISIONS RELATING TO CONFLICTS OF LAW.
14. 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.
If the foregoing correctly sets forth our
understanding, please indicate your acceptance thereof in the
space provided below for that purpose, whereupon this letter
shall constitute a binding agreement among Food 4 Less, each
Subsidiary Guarantor, RSI and the Underwriters.
Very truly yours,
FOOD 4 LESS SUPERMARKETS, INC.
By:______________________________
Name: Mark A. Resnik
Title: Secretary
ALPHA BETA COMPANY,
as a Guarantor
By:______________________________
Name: Mark A. Resnik
Title: Assistant Secretary
BELL MARKETS, INC.,
as a Guarantor
By:______________________________
Name: Mark A. Resnik
Title: Assistant Secretary
CALA CO.,
as a Guarantor
By:______________________________
Name: Mark A. Resnik
Title: Assistant Secretary
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CALA FOODS, INC.,
as a Guarantor
By:______________________________
Name: Mark A. Resnik
Title: Assistant Secretary
FALLEY'S, INC.,
as a Guarantor
By:______________________________
Name: Mark A. Resnik
Title: Assistant Secretary
FOOD 4 LESS OF CALIFORNIA, INC.,
as a Guarantor
By:______________________________
Name: Mark A. Resnik
Title: Assistant Secretary
FOOD 4 LESS MERCHANDISING, INC.,
as a Guarantor
By:______________________________
Name: Mark A. Resnik
Title: Assistant Secretary
FOOD 4 LESS OF SOUTHERN
CALIFORNIA, INC.,
as a Guarantor
By:______________________________
Name: Mark A. Resnik
Title: Assistant Secretary
FOOD 4 LESS GM, INC.
By:______________________________
Name: Mark A. Resnik
Title: Assistant Secretary
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RALPHS SUPERMARKETS, INC.
with respect to Sections 2(b),
7(xi), 7(xv), 9 and 13 only
By:______________________________
Name: Jan Charles Grey
Title: Senior Vice
President, General
Counsel and Secretary
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
BT SECURITIES CORPORATION
By_____________________________
Name: Lori Finkel
Title: Managing Director
CS FIRST BOSTON CORPORATION
By_____________________________
Name:
Title:
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
By_____________________________
Name:
Title:
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