EXHIBIT 1.1
INTERNATIONAL STEEL GROUP INC.
COMMON STOCK, $0.01 PAR VALUE
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UNDERWRITING AGREEMENT
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............, 2003
Xxxxxxx, Xxxxx & Co.,
UBS Securities LLC
As representatives of the several Underwriters
named in Schedule I hereto,
c/o Goldman, Sachs & Co.,
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000.
Ladies and Gentlemen:
International Steel Group Inc., a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions stated herein, to issue and sell
to the Underwriters named in Schedule I hereto (the "Underwriters") an aggregate
of . . . . . . .shares and, at the election of the Underwriters, up to . . . . .
.. additional shares of Common Stock, par value, $0.01 per share ("Stock") of the
Company. The aggregate of . . . . shares to be sold by the Company is herein
called the "Firm Shares" and the aggregate of . . . . . additional shares to be
sold by the Company is herein called the "Optional Shares". The Firm Shares and
the Optional Shares that the Underwriters elect to purchase pursuant to Section
2 hereof are herein collectively called the "Shares."
The Company hereby acknowledges that in connection with the
proposed offering of the Shares, it has requested UBS Financial Services Inc.
("UBS Financial Services") to administer a directed share program (the "Directed
Share Program") under which up to _______ Firm Shares, or 5% of the Firm Shares,
shall be reserved (the "Reserved Shares") for sale by UBS Financial Services at
the initial public offering price to the Company's officers, directors and
employees as designated by the Company, (the "Directed Share Participants") as
part of the distribution of the Shares by the Underwriters, subject to the terms
of this Agreement, the applicable rules, regulations and interpretations of the
National Association of Securities Dealers, Inc. (the "NASD") and all other
applicable laws, rules and regulations. The number of Shares available for sale
to the general public will be reduced to the extent that Directed Share
Participants purchase Reserved Shares. UBS Securities LLC may offer any Reserved
Shares not purchased by Directed Share Participants to the general public on the
same basis as the other Shares being issued and sold hereunder. The Company has
supplied UBS Financial Services with names and addresses of the individuals
which the Company has designated to be eligible participants in the Directed
Share Program. It is understood that any
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number of those designated to participate in the Directed Share Program may
decline to do so.
1. The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(i) A registration statement on Form S-1 (File No. 333-107524)
(the "Initial Registration Statement") in respect of the Shares has
been filed with the Securities and Exchange Commission (the
"Commission"); the Initial Registration Statement and any
post-effective amendment thereto, each in the form heretofore
delivered to you, and, excluding exhibits thereto, to you for each of
the other Underwriters, have been declared effective by the Commission
in such form; other than a registration statement, if any, increasing
the size of the offering (a "Rule 462(b) Registration Statement"),
filed pursuant to Rule 462(b) under the Securities Act of 1933, as
amended (the "Act"), which became effective upon filing, no other
document with respect to the Initial Registration Statement has
heretofore been filed with the Commission; and no stop order
suspending the effectiveness of the Initial Registration Statement,
any post-effective amendment thereto or the Rule 462(b) Registration
Statement, if any, is in effect and no proceeding for that purpose has
been initiated or, to the best knowledge of the Company, threatened by
the Commission (any preliminary prospectus included in the Initial
Registration Statement or filed with the Commission pursuant to Rule
424(a) of the rules and regulations of the Commission under the Act is
hereinafter called a "Preliminary Prospectus"; the various parts of
the Initial Registration Statement and the Rule 462(b) Registration
Statement, if any, including all exhibits thereto and including the
information contained in the form of final prospectus filed with the
Commission pursuant to Rule 424(b) under the Act in accordance with
Section 6(a) hereof and deemed by virtue of Rule 430A under the Act to
be part of the Initial Registration Statement at the time it was
declared effective, each as amended at the time such part of the
Initial Registration Statement became effective or such part of the
Rule 462(b) Registration Statement, if any, became or hereafter
becomes effective, are hereinafter collectively called the
"Registration Statement"; and such final prospectus, in the form first
filed pursuant to Rule 424(b) under the Act, is hereinafter called the
"Prospectus);"
(ii) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary
Prospectus, at the time of filing thereof, conformed in all material
respects to the requirements of the Act and the rules and regulations
of the Commission thereunder, and did not contain an untrue statement
of a material fact or omit to state a material fact required to be
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stated therein or necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
provided, however, that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter through Xxxxxxx, Xxxxx & Co and UBS Securities LLC
expressly for use therein;
(iii) The Registration Statement conforms, and the Prospectus and
any further amendments or supplements to the Registration Statement or
the Prospectus will conform, in all material respects to the
requirements of the Act and the rules and regulations of the
Commission thereunder and do not and will not, as of the applicable
effective date as to the Registration Statement and any amendment
thereto and as of the applicable filing date as to the Prospectus and
any amendment or supplement thereto, contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances in which they were made (in the case of the Prospectus
and any amendment or supplement thereto), not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter
through Xxxxxxx, Sachs & Co. and UBS Securities LLC expressly for use
therein;
(iv) Neither the Company nor any of its subsidiaries has
sustained since the date of the latest audited financial statements
included in the Prospectus any material loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus; and, since the respective dates as of
which information is given in the Registration Statement and the
Prospectus, there has not been any change in the capital stock or
long-term debt of the Company and its subsidiaries, considered as a
whole, or any material adverse change in or affecting the general
affairs, management, business prospects, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries, considered as a whole (a "Company Material Adverse
Effect"), otherwise than as set forth or contemplated in the
Prospectus;
(v) The Company and its subsidiaries have good and marketable
title in fee simple to all real property and good and marketable title
to all personal property owned by them, in each case free and clear of
all liens, encumbrances and defects except such as are described in
the Prospectus or such as do not, singly or in the aggregate,
materially affect the value of such property and do not interfere with
the use made and proposed to be made of such property by the Company
and its
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subsidiaries; and any real property and buildings held under lease by
the Company and its subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as would not,
individually or in the aggregate, result in a Company Material Adverse
Effect;
(vi) (i) The Company has been duly incorporated and is a
corporation in good standing under the laws of the state of Delaware,
with corporate power and authority to own its properties and conduct
its business as described in the Prospectus, and has been duly
qualified as a foreign corporation for the transaction of business and
is in good standing under the laws of each other jurisdiction in which
it owns or leases properties or conducts any business so as to require
such qualification, and (ii) except as could not reasonably be
expected to result in a Company Material Adverse Effect, each
subsidiary of the Company has been duly formed and is validly existing
and in good standing under the laws of its jurisdiction of formation
and has been duly qualified as a foreign entity for the transaction of
business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties or conducts any
business so as to require such qualification;
(vii) The Company has an authorized capitalization as set forth
in the Prospectus, and all of the issued shares of capital stock of
the Company have been duly authorized and validly issued, are fully
paid and non-assessable and conform to the description of the Stock
contained in the Prospectus; and all of the issued shares of capital
stock of each subsidiary of the Company as set forth on Schedule II
hereto (each a "Significant Subsidiary") have been duly and validly
authorized and issued, are fully paid and non-assessable and (except
for directors' qualifying shares and except as set forth in the
Prospectus) are owned directly or indirectly by the Company, free and
clear of all liens, encumbrances, equities or claims; and the
description of the Company's stock option plans, and the options or
other rights granted and exercised thereunder, set forth in the
Prospectus accurately and fairly presents the information required to
be shown with respect to such plans, options and rights;
(viii) The Shares to be issued and sold by the Company to the
Underwriters hereunder have been duly authorized and, when issued and
delivered by the Company against payment therefor as provided herein,
will be validly issued and fully paid and non-assessable and will
conform to the description of the Stock contained in the Prospectus;
(ix) The issue and sale of the Shares and the compliance by the
Company with all of the provisions of this Agreement and the
consummation of the transactions herein contemplated will not (i)
result in any violation of the provisions of the Certificate of
Incorporation or By-laws of the Company or (ii) conflict with or
result in a breach or violation
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of any of the terms or provisions of, or constitute a default under,
any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, nor will such action
result in any violation of the provisions of any statute or any order,
rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of
their properties which, in the case of this clause (ii), would prevent
the Company from performing its obligations under this Agreement or
could not reasonably be expected to result in a Company Material
Adverse Effect; and no consent, approval, authorization, order,
registration or qualification of or with any such court or
governmental agency or body is required for the issue and sale of the
Shares or the consummation by the Company of the transactions
contemplated by this Agreement, except the registration under the Act
of the Shares and such consents, approvals, authorizations,
registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the purchase and
distribution of the Shares by the Underwriters;
(x) Neither the Company nor any of its subsidiaries is (i) in
violation of their respective Certificate of Incorporation or By-laws
or comparable organizational documents or (ii) in default in the
performance or observance of any obligation, agreement, covenant or
condition contained in any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which it is a
party or by which it or any of their respective properties may be
bound except for such defaults that would not, individually or in the
aggregate, result in a Company Material Adverse Effect;
(xi) The statements set forth in the Prospectus under the
caption "Description of Capital Stock", insofar as they purport to
constitute a summary of the terms of the Stock, under the caption
"Description of Indebtedness", and under the caption "Underwriting",
insofar as they purport to describe the provisions of the laws and
documents referred to therein, are accurate and complete in all
material respects;
(xii) Other than as set forth in the Prospectus, there are no
legal or governmental proceedings pending to which the Company or any
of its subsidiaries is a party or of which any property of the Company
or any of its subsidiaries is the subject which, if determined
adversely to the Company or any of its subsidiaries, would
individually or in the aggregate reasonably be expected to result in a
Company Material Adverse Effect; and, to the best of the Company's
knowledge, no such proceedings are threatened by governmental
authorities or others;
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(xiii) The Company is not and, after giving effect to the
offering and sale of the Shares, will not be an "investment company",
as such term is defined in the Investment Company Act of 1940, as
amended (the "Investment Company Act");
(xiv) KPMG LLP, who have certified certain financial statements
of the Company and its subsidiaries, and PricewaterhouseCoopers LLP,
who have certified certain financial statements of Bethlehem Steel
Corporation and its subsidiaries, are each independent public
accountants within the meaning of Regulation S-X under the Act and the
rules and regulations of the Commission thereunder;
(xv) Neither the Company nor its subsidiaries is in violation of
any provisions of the Employee Retirement Income Security Act of 1974,
as amended, except for such violations which would not, individually
or in the aggregate, reasonably be expected to result in a Company
Material Adverse Effect;
(xvi) Except as described in the Prospectus and except for
matters that would not, individually or in the aggregate, reasonably
be expected to result in a Company Material Adverse Effect, (i)
neither the Company nor any of its subsidiaries is in violation of any
applicable federal, state, local or foreign statute, law, rule,
regulation, ordinance, code, policy or rule of common law or any
judicial or administrative interpretation thereof, including any
judicial or administrative order, consent, decree or judgment,
relating to pollution or protection of human health, the environment
(including, without limitation, ambient air, surface water,
groundwater, land surface or subsurface strata) or wildlife,
including, without limitation, laws and regulations relating to the
release or threatened release of chemicals, pollutants, contaminants,
wastes, toxic substances, hazardous substances, petroleum or petroleum
products (collectively, "Hazardous Materials") or to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport
or handling of Hazardous Materials (collectively, "Environmental
Laws"), (ii) the Company and its subsidiaries have all permits,
authorizations and approvals required under any applicable
Environmental Laws and are each in compliance with their requirements,
(iii) there are no pending or, to the Company's knowledge, threatened
administrative, regulatory or judicial actions, suits, demands, demand
letters, claims, liens, notices of noncompliance or violation,
investigation or proceedings relating to any Environmental Laws
against the Company or any of its subsidiaries and (iv) to the best of
the Company's knowledge, there are no events or circumstances that
might reasonably be expected to form the basis of an order for
clean-up or remediation, or an action, suit or proceeding by any
private party or governmental body or agency against or affecting the
Company or any of its subsidiaries relating to Hazardous Materials or
Environmental Laws;
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(xvii) Except as described in the Prospectus and except items
that, individually or in the aggregate, would not be reasonably
expected to result in a Company Material Adverse Effect, no labor
dispute with the employees of the Company or any of its subsidiaries
exists or is imminent, and the Company is not aware that any executive
or group of employees of the Company or any of its subsidiaries plans
to terminate employment with the Company or any of its subsidiaries;
(xviii) The Company has not distributed and will not distribute
prior to the completion of the distribution of the Shares, any
offering material in connection with the offering and sale of the
Shares other than any Preliminary Prospectuses, the Prospectus, the
Registration Statement and other materials, if any, permitted by the
Act;
(xix) The Company has not taken and will not take, directly or
indirectly (other than with respect to the Underwriters as to whom the
Company makes no representation in connection therewith), any action
which is designed to or which has constituted or which might
reasonably be expected to cause or result in stabilization or
manipulation of the price of any security of the Company to facilitate
the sale or resale of the Shares;
(xx) Except as described in the Prospectus and except items
that, individually or in the aggregate, would not be reasonably
expected to result in a Company Material Adverse Effect, each of the
Company and its subsidiaries has obtained and holds in full force and
effect the right to use all patents, trademarks, copyrights and such
other rights or adequate licenses therein which are necessary for the
operation of its business in the manner described in the Prospectus,
free from restrictions which would reasonably be expected to have,
individually or in the aggregate, a Company Material Adverse Effect;
(xxi) Other than as set forth in the Prospectus, (i) no person
has the right, contractual or otherwise, to cause the Company to issue
or sell to it any shares of Common Stock of the Company, and (ii) no
person has any preemptive rights, resale rights, rights of first
refusal or other rights to purchase any shares of Common stock in the
case of each of the foregoing clauses (i) and (ii), whether as a
result of the filing or effectiveness of the Registration Statement or
the sale of the Shares as contemplated thereby or otherwise; other
than as set forth in the Prospectus, no person has the right,
contractual or otherwise, to cause the Company to register under the
Act any shares of Common Stock or to include any such shares in the
Registration Statement or the offering contemplated thereby whether as
a result of the filing or effectiveness of the Registration Statement
or the sale of the Shares as contemplated thereby or otherwise, except
for such rights as have been complied with or waived;
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(xxii) This Agreement has been duly authorized, executed and
delivered by the Company;
(xxiii) The audited financial statements included in the
Registration Statement and the Prospectus, together with the related
notes and schedules, present fairly, in all material respects, the
consolidated financial position of the Company and its subsidiaries as
of the dates indicated and the consolidated results of operations and
cash flows of the Company and its subsidiaries for the periods
specified and have been prepared in compliance with the requirements
of the Act and in conformity with generally accepted accounting
principles applied on a consistent basis during the periods involved;
any pro forma financial statements or data included in the
Registration Statement and the Prospectus comply with the requirements
of Regulation S-X of the Act and the assumptions used in the
preparation of such pro forma financial statements and data are
reasonable, the pro forma adjustments used therein are appropriate to
give effect to the transactions or circumstances described therein and
the pro forma adjustments have been properly applied to the historical
amounts in the compilation of those statements and data; the other
financial and statistical data set forth in the Registration Statement
and the Prospectus are accurately presented and prepared on a basis
consistent with the financial statements and books and records of the
Company; there are no financial statements (historical or pro forma)
that are required to be included in the Registration Statement and the
Prospectus that are not included as required; and the Company and its
subsidiaries do not have any material liabilities or obligations,
direct or contingent (including any off-balance sheet obligations),
not disclosed in the Registration Statement and the Prospectus;
(xxiv) All tax returns required to be filed by the Company and
each of its subsidiaries have been filed, and all taxes and other
assessments of a similar nature (whether imposed directly or through
withholding) including any interest, additions to tax or penalties
applicable thereto due or claimed to be due from such entities have
been paid, other than those being contested in good faith and for
which adequate reserves have been provided;
(xxv) The Company and each of its subsidiaries maintains
insurance covering its properties, operations, personnel and
businesses as the Company deems adequate and as previously disclosed
to the Representatives; such insurance insures against such losses and
risks to an extent which is adequate in accordance with customary
industry practice to protect the Company and its subsidiaries and
their businesses; all such insurance is outstanding and fully in force
in all material respects on the date hereof and will be outstanding
and duly in force at the time of purchase of the Firm Shares and
additional time of purchase of the Option Shares, as the case may be;
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(xxvi) The Company and each of its subsidiaries maintain a
system of internal accounting controls sufficient to provide
reasonable assurance that (i) transactions are executed in accordance
with management's general or specific authorization; (ii) transactions
are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles
and to maintain accountability for assets; (iii) access to assets is
permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is
compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences;
(xxvii) The Company has established and maintains disclosure
controls and procedures (as such term is defined in Rule 13a-14 and
15d-14 under the Securities Exchange Act of 1934, as amended); such
disclosure controls and procedures are designed to ensure that
material information relating to the Company, including its
consolidated subsidiaries, is made known to the Company's Chief
Executive Officer and its Chief Financial Officer by others within
those entities, and such disclosure controls and procedures are
effective to perform the functions for which they were established;
the Company's auditors and the Audit Committee of the Board of
Directors have been advised of: (i) any significant deficiencies in
the design or operation of internal controls which could adversely
affect the Company's ability to record, process, summarize, and report
financial data; and (ii) any fraud, whether or not material, that
involves management or other employees who have a role in the
Company's internal controls; any material weaknesses in internal
controls have been identified for the Company's auditors; and since
the date of the most recent evaluation of such disclosure controls and
procedures, there have been no significant changes in internal
controls or in other factors that could significantly affect internal
controls, including any corrective actions with regard to significant
deficiencies and material weaknesses;
(xxviii) The Company has provided to the Representatives true,
correct, and complete copies of all documentation pertaining to any
extension of credit in the form of a personal loan made, directly or
indirectly, by the Company to any director or executive officer of the
Company, or to any family member or affiliate of any director or
executive officer of the Company; and since July 30, 2002, the Company
has not, directly or indirectly, including through any subsidiary: (i)
extended credit, arranged to extend credit, or renewed any extension
of credit, in the form of a personal loan, to or for any director or
executive officer of the Company, or to or for any family member or
affiliate of any director or executive officer of the Company; or (ii)
made any material modification, including any renewal thereof, to any
term of any personal loan to any director or executive officer of the
Company, or any family
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member or affiliate of any director or executive officer, which loan
was outstanding on July 30, 2002;
(xxix) the Registration Statement, the Prospectus and any
Preliminary Prospectus comply or will comply, and any further
amendments or supplements thereto will comply, with any applicable
laws or regulations of any foreign jurisdiction in which the
Prospectus or any Preliminary Prospectus, as amended or supplemented,
is distributed in connection with the Directed Share Program; and no
approval, authorization, consent or order of or filing with any
governmental or regulatory commission, board, body, authority or
agency, other than those obtained, is required in connection with the
offering of the Reserved Shares in any jurisdiction where the Reserved
Shares are being offered; and
(xxx) the Company has not offered, or caused the Underwriters
to offer, Shares to any person pursuant to the Directed Share Program
with the intent to influence unlawfully (i) a customer or supplier of
the Company or any of the Subsidiaries to alter the customer's or
supplier's level or type of business with the Company or any of the
Subsidiaries, or (ii) a trade journalist or publication to write or
publish favorable information about the Company or any of the
Subsidiaries or any of their respective products or services.
2. Subject to the terms and conditions herein set forth, (a) the Company
agrees to sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company, at a purchase price per
share of $.............., the number of Firm Shares (to be adjusted by you so as
to eliminate fractional shares) determined by multiplying the aggregate number
of Shares to be sold by the Company hereto by a fraction, the numerator of which
is the aggregate number of Firm Shares to be purchased by such Underwriter as
set forth opposite the name of such Underwriter in Schedule I hereto and the
denominator of which is the aggregate number of Firm Shares to be purchased by
all of the Underwriters from the Company and (b) in the event and to the extent
that the Underwriters shall exercise the election to purchase Optional Shares as
provided below, the Company agrees to sell to each of the Underwriters, and each
of the Underwriters agrees, severally and not jointly, to purchase from the
Company, at the purchase price per share set forth in clause (a) of this Section
2, that portion of the number of Optional Shares as to which such election shall
have been exercised (to be adjusted by you so as to eliminate fractional shares)
determined by multiplying such number of Optional Shares by a fraction the
numerator of which is the maximum number of Optional Shares which such
Underwriter is entitled to purchase as set forth opposite the name of such
Underwriter in Schedule I hereto and the denominator of which is the maximum
number of Optional Shares that all of the Underwriters are entitled to purchase
hereunder.
The Company, as and to the extent indicated in Schedule I hereto, hereby
grants to the Underwriters the right to purchase at their election up to
.................... Optional
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Shares, at the purchase price per share set forth in the paragraph above, for
the sole purpose of covering sales of shares in excess of the number of Firm
Shares. Any such election to purchase Optional Shares may be exercised only by
written notice from you to the Company, given within a period of 30 calendar
days after the date of this Agreement and setting forth the aggregate number of
Optional Shares to be purchased and the date on which such Optional Shares are
to be delivered, as determined by you but in no event earlier than the First
Time of Delivery (as defined in Section 5 hereof) or, unless the Representatives
and the Company otherwise agree in writing, earlier than two or later than ten
business days after the date of such notice.
3. The Company hereby confirms its engagement of Xxxxxxx, Xxxxx & Co. as,
and Xxxxxxx, Sachs & Co. hereby confirms its agreement with the Company to
render services as, a "qualified independent underwriter" within the meaning of
Rule 2720(b)(15) of the NASD with respect to the offering and sale of the
Shares. Xxxxxxx, Xxxxx & Co., in its capacity as qualified independent
underwriter and not otherwise, is referred to herein as the "QIU." As
compensation for the services of the QIU hereunder, the Company agrees to pay
the QIU $5,000 on the Closing Date.
4. Upon the authorization by you of the release of the Firm Shares, the
several Underwriters propose to offer the Firm Shares for sale upon the terms
and conditions set forth in the Prospectus.
5. (a) The Shares to be purchased by each Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in such
names as [ ] may request upon at least forty-eight hours' prior notice to the
Company shall be delivered by or on behalf of the Company to [ ], through the
facilities of the Depository Trust Company ("DTC"), for the account of such
Underwriter, against payment by or on behalf of such Underwriter of the purchase
price therefor by wire transfer of Federal (same-day) funds to the account
specified by the Company, as its interests may appear, to [ ] at least
forty-eight hours in advance. The Company will cause the certificates
representing the Shares to be made available for checking and packaging at least
twenty-four hours prior to the Time of Delivery (as defined below) with respect
thereto at the office of [ ] (the "Designated Office"). The time and date of
such delivery and payment shall be, with respect to the Firm Shares, 9:30 a.m.,
New York time, on ............., 2003 or such other time and date as [ ] and the
Company may agree upon in writing, and, with respect to the Optional Shares,
9:30 a.m., New York time, on the date specified by [ ] in the written notice
given by [ ] of the Underwriters' election to purchase such Optional Shares, or
such other time and date as [ ] and the Company may agree upon in writing. Such
time and date for delivery of the Firm Shares is herein called the "First Time
of Delivery", such time and date for delivery of the Optional Shares, if not the
First Time of Delivery, is herein called the "Second Time of Delivery", and each
such time and date for delivery is herein called a "Time of Delivery."
(b) The documents to be delivered at each Time of Delivery by or on behalf
of the parties hereto pursuant to Section 8 hereof, including the cross receipt
for the Shares and any additional documents reasonably requested by the
Underwriters pursuant to
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Section 8(m) hereof, will be delivered at the offices of Skadden, Arps, Slate,
Xxxxxxx & Xxxx LLP, Four Times Square, Xxx Xxxx, XX 00000 (the "Closing
Location"), and the Shares will be delivered at the Designated Office, all at
such Time of Delivery. A meeting will be held at the Closing Location at
........p.m., New York City time, on the New York Business Day next preceding
such Time of Delivery, at which meeting the final drafts of the documents to be
delivered pursuant to the preceding sentence will be available for review by the
parties hereto. For the purposes of this Section 5, "New York Business Day"
shall mean each Monday, Tuesday, Wednesday, Thursday and Friday which is not a
day on which banking institutions in New York are generally authorized or
obligated by law or executive order to close.
6. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and to file such
Prospectus pursuant to Rule 424(b) under the Act not later than the Commission's
close of business on the second business day following the execution and
delivery of this Agreement, or, if applicable, such earlier time as may be
required by Rule 430A(a)(3) under the Act; unless required by the Act, to make
no further amendment or any supplement to the Registration Statement or
Prospectus which shall be disapproved by you promptly after reasonable notice
thereof; to advise you, promptly after it receives notice thereof, of the time
when any amendment to the Registration Statement has been filed or becomes
effective or any supplement to the Prospectus or any amended Prospectus has been
filed and to furnish you with copies thereof; to advise you, promptly after it
receives notice thereof, of the issuance by the Commission of any stop order or
of any order preventing or suspending the use of any Preliminary Prospectus or
Prospectus, of the suspension of the qualification of the Shares for offering or
sale in any jurisdiction, of the initiation or threatening of any proceeding for
any such purpose, or of any request by the Commission for the amending or
supplementing of the Registration Statement or Prospectus or for additional
information; and, in the event of the issuance of any stop order or of any order
preventing or suspending the use of any Preliminary Prospectus or Prospectus or
suspending any such qualification, promptly to use its reasonable best efforts
to obtain the withdrawal of such order;
(b) Promptly from time to time to take such action as you may reasonably
request to qualify the Shares for offering and sale under the securities laws of
such jurisdictions as you may reasonably request and to comply with such laws so
as to permit the continuance of sales and dealings therein in such jurisdictions
for as long as may be necessary to complete the distribution of the Shares,
provided that in connection therewith the Company shall not be required to
qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction or to subject itself to taxation for doing business
in any jurisdiction;
(c) Prior to 3:00 P.M., New York City time, on the New York Business Day
next succeeding the date of this Agreement and from time to time, to furnish the
Underwriters with written and electronic copies of the Prospectus in New York
City in such quantities as you may reasonably request, and, if the delivery of a
prospectus is required at any time prior to the expiration of nine months after
the time of issue of the
12
Prospectus in connection with the offering or sale of the Shares and if at such
time any events shall have occurred as a result of which the Prospectus as then
amended or supplemented would include an untrue statement of a material fact or
omit to state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made when such
Prospectus is delivered, not misleading, or, if for any other reason it shall be
necessary during such period to amend or supplement the Prospectus in order to
comply with the Act, to notify you and upon your request to prepare and furnish
without charge to each Underwriter and to any dealer in securities as many
written and electronic copies as you may from time to time reasonably request of
an amended Prospectus or a supplement to the Prospectus which will correct such
statement or omission or effect such compliance, and in case any Underwriter is
required by law, rule or regulation to deliver a prospectus in connection with
sales of any of the Shares at any time nine months or more after the time of
issue of the Prospectus, upon your request but at the expense of such
Underwriter, to prepare and deliver to such Underwriter as many written and
electronic copies as you may reasonably request of an amended or supplemented
Prospectus complying with Section 10(a)(3) of the Act;
(d) To timely file such reports pursuant to the Securities Exchange Act of
1934 (the "1934 Act") as are necessary in order to make generally available to
its securityholders within the required time periods after the effective date of
the Registration Statement (as the term "effective date" is defined in Rule
158(c) under the Act), an earnings statement of the Company and its subsidiaries
(which need not be audited) which shall satisfy the provisions of Section 11(a)
of the Act and the rules and regulations of the Commission thereunder
(including, at the option of the Company, Rule 158);
(e) During the period beginning from the date hereof and continuing to and
including the date 180 days after the date of the Prospectus, not to offer,
sell, contract to sell or otherwise dispose of, except as provided hereunder,
any securities of the Company that are substantially similar to the Shares,
including but not limited to any securities that are convertible into or
exchangeable for, or that represent the right to receive, Stock or any such
substantially similar securities (other than pursuant to employee stock option
plans existing on, or upon the conversion or exchange of convertible or
exchangeable securities outstanding as of, the date of this Agreement), without
your prior written consent;
(f) To the extent required by the 1934 Act, to make available to its
stockholders within (i) 90 days after the end of each fiscal year an annual
report (including a balance sheet and statements of income, stockholders' equity
and cash flows of the Company and its consolidated subsidiaries certified by
independent public accountants) and (ii) 45 days after the end of each of the
first three quarters of each fiscal year a quarterly report;
(g) During a period of two years from the effective date of the
Registration Statement, to furnish or make available to you copies of all
reports or other communications (financial or other) furnished to stockholders,
and to deliver or make
13
available to you (i) as soon as they are available, copies of any reports and
financial statements furnished to or filed with the Commission or any national
securities exchange on which any class of securities of the Company is listed;
and (ii) such additional information concerning the business and financial
condition of the Company as you may from time to time reasonably request (such
financial statements to be on a consolidated basis to the extent the accounts of
the Company and its subsidiaries are consolidated in reports furnished to its
stockholders generally or to the Commission), provided that such information
shall be subject to such confidentiality and use restrictions as the Company
shall impose;
(h) To use the net proceeds received by it from the sale of the Shares
pursuant to this Agreement in the manner specified in the Prospectus under the
caption "Use of Proceeds";
(i) To use its reasonable best efforts to list, subject to notice of
issuance, the Shares on the New York Stock Exchange (the "Exchange");
(j) To file with the Commission such information on Form 10-Q or Form 10-K
as may be required by Rule 463 under the Act;
(k) If the Company elects to rely upon Rule 462(b), the Company shall file
a Rule 462(b) Registration Statement with the Commission in compliance with Rule
462(b) by 10:00 P.M., Washington, D.C. time, on the date of this Agreement, and
the Company shall at the time of filing either pay to the Commission the filing
fee for the Rule 462(b) Registration Statement or give irrevocable instructions
for the payment of such fee pursuant to Rule 111(b) under the Act;
(l) Upon request of any Representative, to furnish, or cause to be
furnished, to such Underwriter an electronic version of the Company's
trademarks, servicemarks and corporate logo for use on the website, if any,
operated by such Representative for the purpose of facilitating the offering of
the Shares (the "License"); provided, however, that the License shall be used
solely for the purpose described above, is granted without any fee and may not
be assigned or transferred;
(m) To pay to UBS Financial Services the full purchase price of the common
stock allocated and billed by means of confirmation to any Directed Share
Participant who fails to pay for the common stock by the end of the settlement
date for such purchase; and
(n) To ensure that any Reserved Shares purchased by a director, officer or
employee of the Company who is associated or affiliated with an NASD Member will
be restricted from sale, transfer, assignment, pledge or hypothecation for such
period and to such extent as may be required by the NASD and its rules; and to
comply with all applicable securities and other applicable laws, rules and
regulations in each jurisdiction in which the Reserved Shares are offered in
connection with the Directed Share Program.
7. The Company covenants and agrees with the several Underwriters and UBS
Financial Services that the Company will pay or cause to be paid: (i) the fees,
14
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Shares under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or producing
of a reasonable number of each of the Agreement among Underwriters, this
Agreement, the Blue Sky Memorandum, closing documents (including any
compilations thereof) and any other documents in connection with the offering,
purchase, sale and delivery of the Shares; (iii) all expenses in connection with
the qualification of the Shares for offering and sale under state securities
laws as provided in Section 6(b) hereof, including the reasonable fees and
disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky survey; (iv) all fees and
expenses in connection with listing the Shares on the Exchange; (v) the filing
fees incident to, and the reasonable fees and disbursements of counsel for the
Underwriters in connection with, securing any required review by the National
Association of Securities Dealers, Inc. of the terms of the sale of the Shares;
(vi) the cost of preparing stock certificates; (vii) the cost and charges of any
transfer agent or registrar; (viii) all other costs and expenses incident to the
performance of its obligations hereunder which are not otherwise specifically
provided for in this Section and (ix) all costs, fees and expenses in connection
with the offer and sale of the Reserved Shares, including all costs and expenses
of UBS Financial Services, as administrator of the Directed Share Program,
including the reasonable fees and disbursements of counsel for the UBS Financial
Services, as administrators of the Directed Share Program. It is understood
that, except as provided in this Section, and Sections 9 and 13 hereof, the
Underwriters will pay all of their own costs and expenses, including the fees of
their counsel, stock transfer taxes on resale of any of the Shares by them, and
any advertising expenses connected with any offers they may make.
8. The obligations of the Underwriters hereunder, as to the Shares to be
delivered at each Time of Delivery, shall be subject, in their discretion, to
the condition that all representations and warranties and other statements of
the Company herein are, at and as of such Time of Delivery, true and correct,
the condition that the Company shall have performed all of its obligations
hereunder theretofore to be performed, and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant
to Rule 424(b) within the applicable time period prescribed for such filing
by the rules and regulations under the Act and in accordance with Section
6(a) hereof; if the Company has elected to rely upon Rule 462(b), the Rule
462(b) Registration Statement shall have become effective by 10:00 P.M.,
Washington, D.C. time, on the date of this Agreement; no stop order
suspending the effectiveness of the Registration Statement or any part
thereof shall have been issued and no proceeding for that purpose shall
have been initiated or, to the best of the Company's knowledge, threatened
by the Commission; and all requests for additional information on the part
of the Commission shall have been complied with to your reasonable
satisfaction;
15
(b) Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, counsel for the
Underwriters, shall have furnished to you their written opinion in the form
attached hereto as Annex III(a)), dated such Time of Delivery, and such
counsel shall have received such papers and information as they may
reasonably request to enable them to pass upon such matters;
(c) Xxxxx Day, counsel for the Company, shall have furnished to you
their written opinion in the form attached hereto as Annex III(b) hereto),
dated such Time of Delivery;
(d) Squire, Xxxxxxx and Xxxxxxx, LLP, environmental counsel for the
Company, shall have furnished to you their written opinion (a draft of such
opinion is attached as Annex III(c) hereto), dated such Time of Delivery,
in form and substance reasonably satisfactory to you;
(e) On the date of the Prospectus at a time prior to the execution of
this Agreement, at 9:30 a.m., New York City time, on the effective date of
any post-effective amendment to the Registration Statement filed subsequent
to the date of this Agreement and also at each Time of Delivery, KPMG LLP
shall have furnished to you a letter or letters, dated the respective dates
of delivery thereof, in form and substance satisfactory to you (the
executed copy of the letter delivered prior to the execution of this
Agreement is attached as Annex I(a) hereto and a draft of the form of
letter to be delivered on the effective date of any post-effective
amendment to the Registration Statement and as of each Time of Delivery is
attached as Annex I(b) hereto);
(f) On the date of the Prospectus at a time prior to the execution of
this Agreement, at 9:30 a.m., New York City time, on the effective date of
any post-effective amendment to the Registration Statement filed subsequent
to the date of this Agreement and also at each Time of Delivery,
PricewaterhouseCoopers LLP shall have furnished to you a letter or letters,
dated the respective dates of delivery thereof, in form and substance
satisfactory to you (the executed copy of the letter delivered prior to the
execution of this Agreement is attached as Annex II(a) hereto and a draft
of the form of letter to be delivered on the effective date of any
post-effective amendment to the Registration Statement and as of each Time
of Delivery is attached as Annex II(b) hereto);
(g) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements
included in the Prospectus any loss or interference with its business from
fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action, order
or decree, otherwise than as set forth or contemplated in the Prospectus,
and (ii) since the respective dates as of which information is given in the
Prospectus there shall not have been any change in the capital stock or
long-term debt of the Company or any of its subsidiaries or any change in
or affecting the general affairs, management, business prospects, financial
position, stockholders' equity or results of operations of the Company
16
and its subsidiaries, otherwise than as set forth or contemplated in the
Prospectus, the effect of which, in any such case described in clause (i)
or (ii), is in the judgment of the Representatives so material and adverse
as to make it impracticable or inadvisable to proceed with the public
offering or the delivery of the Shares being delivered at such Time of
Delivery on the terms and in the manner contemplated in the Prospectus;
(h) On or after the date hereof (i) no downgrading shall have
occurred in the rating accorded the Company's debt securities, if any, by
any "nationally recognized statistical rating organization", as that term
is defined by the Commission for purposes of Rule 436(g)(2) under the Act,
and (ii) no such organization shall have publicly announced that it has
under surveillance or review, with possible negative implications, its
rating of any of the Company's debt securities;
(i) On or after the date hereof, there shall not have occurred any of
the following: (i) a suspension or material limitation in trading in
securities generally on the Exchange (ii) a suspension or material
limitation in trading in the Company's securities on the Exchange; (iii) a
general moratorium on commercial banking activities declared by either
Federal or New York State authorities or a material disruption in
commercial banking or securities settlement or clearance services in the
United States; (iv) the outbreak or escalation of hostilities involving the
United States or the declaration by the United States of a national
emergency or war or (v) the occurrence of any other calamity or crisis or
any change in financial, political or economic conditions in the United
States or elsewhere, if the effect of any such event specified in clause
(iv) or (v) in the judgment of the Representatives makes it impracticable
or inadvisable to proceed with the public offering or the delivery of the
Shares being delivered at such Time of Delivery on the terms and in the
manner contemplated in the Prospectus;
(j) The Shares at such Time of Delivery shall have been duly approved
for listing, subject to notice of issuance, on the Exchange;
(k) The Company has obtained and delivered to the Underwriters
executed copies of agreements from each officer, director and stockholder
of the Company and each employee of the Company that has indicated an
interest in purchasing $100,000 or more of the Reserved Shares,
substantially in the forms attached hereto as Annex IV;
(l) The Company shall have complied with the provisions of Section
6(c) hereof with respect to the furnishing of prospectuses on the New York
Business Day next succeeding the date of this Agreement; and
(m) The Company shall have furnished or caused to be furnished to you
at such Time of Delivery certificates of officers of the Company
satisfactory to you as to the accuracy of the representations and
warranties of the Company herein at and as of such Time of Delivery, as to
the performance by the Company
17
of all of its obligations hereunder to be performed at or prior to such
Time of Delivery, and as to such other matters as you may reasonably
request, and the Company shall have furnished or caused to be furnished
certificates as to the matters set forth in subsections (a) and (g) of this
Section.
9. (a) (i) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon (A) an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, the Registration
Statement or the Prospectus, or any amendment or supplement thereto, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and will reimburse each Underwriter for any legal or
other expenses reasonably incurred by such Underwriter in connection with
investigating or defending any such action or claim as such expenses are
incurred; provided, however, that the Company shall not be liable in any such
case to the extent that any such loss, claim, damage or liability arises out of
or is based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in any Preliminary Prospectus, the Registration Statement
or the Prospectus or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by such Underwriter
through Xxxxxxx, Sachs & Co. and UBS Securities LLC expressly for use therein;
or (B) the Directed Share Program, provided that the Company shall not be
responsible under this clause (B) for any loss, damage, expense, liability or
claim that is finally judicially determined by a court of competent jurisdiction
to have resulted from the gross negligence or willful misconduct of such
Underwriter in conducting the Directed Share Program.
(ii) The Company agrees to indemnify, defend and hold harmless
UBS Financial Services and its partners, directors and officers, and
any person who controls UBS Financial Services within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, and the
successors and assigns of all of the foregoing persons, from and
against any loss, damage, expense, liability or claim (including the
reasonable cost of investigation) which, jointly or severally, UBS
Financial Services or any such person may incur under the Act, the
Exchange Act, the common law or otherwise, insofar as such loss,
damage, expense, liability or claim arises out of or is (A) based upon
any untrue statement or alleged untrue statement of a material fact
contained in any material prepared by or with the consent of the
Company, including the Preliminary Prospectus, for distribution to
Directed Share Participants in connection with the Directed Share
Program or caused by any omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading; (B) caused by the failure of any
Directed Share Participant to pay for and accept delivery of Reserved
Shares that the Directed Share Participant has agreed to purchase; (C)
caused by the failure of any Directed Share Participant to receive the
18
materials related to the Directed Share Program to allow such
participant enough time to participate in the Directed Share Program;
(D) caused by the failure of any Directed Share Participant to (1)
return the indication of interest to UBS Financial Services by the
required time or (2) comply with any additional required procedures;
(E) based upon the inability of UBS Financial Services to confirm the
order of any Directed Share Participant after the Registration
Statement is declared effective; (F) caused by the failure of any
Directed Share Participant to meet the qualification standards for
participation in the Directed Share Program; (G) based upon any claims
related to the Directed Share Program arising subsequent to the
delivery of the Reserved Shares to any Directed Share Participant; or
(H) otherwise arises out of or is based upon the Directed Share
Program, provided that the Company shall not be responsible under this
clause (H) for any loss, damage, expense, liability or claim that is
finally judicially determined by a court of competent jurisdiction to
have resulted from the gross negligence or willful misconduct of UBS
Financial Services in conducting the Directed Share Program.
(b) Each Underwriter will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon an untrue statement or alleged untrue statement of a material
fact contained in any Preliminary Prospectus, the Registration Statement or
the Prospectus, or any amendment or supplement thereto, or arise out of or
are based upon the omission or alleged omission to state therein a material
fact required to be stated therein 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 any Preliminary Prospectus, the Registration
Statement or the Prospectus or any such amendment or supplement in reliance
upon and in conformity with written information furnished to the Company by
such Underwriter through Xxxxxxx, Xxxxx & Co. and UBS Securities LLC
expressly for use therein; and will reimburse the Company for any legal or
other expenses reasonably incurred by the Company in connection with
investigating or defending any such action or claim as such expenses are
incurred.
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under such subsection, notify the
indemnifying party in writing of the commencement thereof; but the omission
so to notify the indemnifying party shall not relieve it from any liability
which it may have to any indemnified party otherwise than under such
subsection. In case any such action shall be brought against any
indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with any
other indemnifying
19
party similarly notified, to assume the defense thereof, with counsel
reasonably satisfactory to such indemnified party (who shall not, except
with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified
party of its election so to assume the defense thereof, the indemnifying
party shall not be liable to such indemnified party under such subsection
for any legal expenses of other counsel or any other expenses, in each case
subsequently incurred by such indemnified party, in connection with the
defense thereof other than reasonable costs of investigation. No
indemnifying party shall, without the written consent of the indemnified
party, effect the settlement or compromise of, or consent to the entry of
any judgment with respect to, any pending or threatened action or claim in
respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified party is an actual or potential party to
such action or claim) unless such settlement, compromise or judgment (i)
includes an unconditional release of the indemnified party from all
liability arising out of such action or claim and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to act,
by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 9 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party 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 the relative benefits received by the Company on the
one hand and the Underwriters on the other from the offering of the Shares.
If, however, the allocation provided by the immediately preceding sentence
is not permitted by applicable law or if the indemnified party failed to
give the notice required under subsection (c) above, then each indemnifying
party shall contribute to such amount paid or payable by such indemnified
party in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company on the one
hand and the Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities (or
actions in respect thereof), as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one
hand and the Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering (before deducting
expenses) received by the Company bear to the total underwriting discounts
and commissions received by the Underwriters, in each case as set forth in
the table on the cover page of the Prospectus. The relative fault shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Company on the one hand or the Underwriters on the other and the parties'
relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company and the
Underwriters agree that it would not be just and equitable if contributions
pursuant to this subsection (d) were determined by pro rata
20
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above in this subsection (d).
The amount paid or payable by an indemnified party as a result of the
losses, claims, damages or liabilities (or actions in respect thereof)
referred to above in this subsection (d) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), no Underwriter shall
be required to contribute any amount in excess of the amount by which the
total price at which the Shares underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which
such Underwriter has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. 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. The Underwriters'
obligations in this subsection (d) to contribute are several in proportion
to their respective underwriting obligations and not joint.
(e) The obligations of the Company under this Section 9 shall be in
addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls any Underwriter within the meaning of the Act; and the obligations
of the Underwriters under this Section 9 shall be in addition to any
liability which the respective Underwriters may otherwise have and shall
extend, upon the same terms and conditions, to each officer and director of
the Company (including any person who, with his or her consent, is named in
the Registration Statement as about to become a director of the Company)
and to each person, if any, who controls the Company within the meaning of
the Act.
10. (a) The Company will indemnify and hold harmless Xxxxxxx, Xxxxx & Co.,
in its capacity as QIU, against any losses, claims, damages or liabilities,
joint or several, to which the QIU may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon (i) an untrue statement or
alleged untrue statement of a material fact contained in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or any amendment or
supplement thereto, (ii) the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading or (iii) any act or omission to act or any alleged act or
omission to act by Xxxxxxx, Sachs & Co. as QIU in connection with any
transaction contemplated by this Agreement or undertaken in preparing for the
purchase, sale and delivery of the Shares, except as to this clause (iii) to the
extent that any such loss, claim, damage or liability results from the gross
negligence or bad faith of Xxxxxxx, Xxxxx & Co. in performing the services as
QIU, and will reimburse the QIU for any legal or other expenses reasonably
incurred by the QIU in connection with investigating or defending any such
action or claim as such expenses are incurred.
21
(b) Promptly after receipt by the QIU under subsection (a) above of notice
of the commencement of any action, the QIU shall, if a claim in respect thereof
is to be made against the Company under such subsection, notify the Company in
writing of the commencement thereof; but the omission so to notify the Company
shall not relieve it from any liability which it may have to the QIU otherwise
than under such subsection. In case any such action shall be brought against the
QIU and it shall notify the Company of the commencement thereof, the Company
shall be entitled to participate therein and, to the extent that it shall wish,
jointly with any other indemnifying party similarly notified, to assume the
defense thereof, with counsel satisfactory to the QIU (who shall not, except
with the consent of the QIU, be counsel to the Company), and, after notice from
the indemnifying party to the QIU of its election so to assume the defense
thereof, the indemnifying party shall not be liable to the QIU under such
subsection for any legal expenses of other counsel or any other expenses, in
each case subsequently incurred by the QIU, in connection with the defense
thereof other than reasonable costs of investigation. The Company shall not,
without the written consent of the indemnified party, effect the settlement or
compromise of, or consent to the entry of any judgment with respect to, any
pending or threatened action or claim in respect of which indemnification or
contribution may be sought hereunder (whether or not the QIU is an actual or
potential party to such action or claim) unless such settlement, compromise or
judgment (i) includes an unconditional release of the QIU from all liability
arising out of such action or claim and (ii) does not include a statement as to
or an admission of fault, culpability or a failure to act, by or on behalf of
QIU.
(c) If the indemnification provided for in this Section 10 is unavailable
to or insufficient to hold harmless Xxxxxxx, Sachs & Co., in its capacity as
QIU, under subsection (a) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then the
Company shall contribute to the amount paid or payable by the QIU as a result of
such losses, claims, damages or liabilities (or actions in respect thereof) in
such proportion as is appropriate to reflect the relative benefits received by
the Company on the one hand and the QIU on the other from the offering of the
Shares. If, however, the allocation provided by the immediately preceding
sentence is not permitted by applicable law or if the QIU failed to give the
notice required under subsection (b) above, then the Company shall contribute to
such amount paid or payable by the QIU in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company on the one hand and the QIU on the other in connection with the
statements or omissions which resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the QIU on the other shall be deemed to be in the same proportion
as the total net proceeds from the offering (before deducting expenses) received
by the Company, as set forth in the table on the cover page of the Prospectus,
bear to the fee payable to the QIU pursuant to Section 3 hereof. The relative
fault shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company
on the one hand or the QIU on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company and the QIU agree that it would not be just
and equitable if
22
contributions pursuant to this subsection (c) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above in this subsection (c). The
amount paid or payable by the QIU as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to above in this subsection
(c) shall be deemed to include any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim. 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.
(d) The obligations of the Company under this Section 10 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls the QIU
within the meaning of the Act.
11. (a) If any Underwriter shall default in its obligation to purchase the
Shares which it has agreed to purchase hereunder at a Time of Delivery, you may
in your discretion arrange for you or another party or other parties to purchase
such Shares on the terms contained herein. If within thirty-six hours after such
default by any Underwriter you do not arrange for the purchase of such Shares,
then the Company shall be entitled to a further period of thirty-six hours
within which to procure another party or other parties satisfactory to you to
purchase such Shares on such terms. In the event that, within the respective
prescribed periods, you notify the Company that you have so arranged for the
purchase of such Shares, or the Company notifies you that it has so arranged for
the purchase of such Shares, you or the Company shall have the right to postpone
(a) Time of Delivery for a period of not more than seven days, in order to
effect whatever changes may thereby be made necessary in the Registration
Statement or the Prospectus, or in any other documents or arrangements, and the
Company agrees to file promptly any amendments to the Registration Statement or
the Prospectus which in your opinion may thereby be made necessary. The term
"Underwriter" as used in this Agreement shall include any person substituted
under this Section with like effect as if such person had originally been a
party to this Agreement with respect to such Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased does not exceed 10% of the aggregate number of all the
Shares to be purchased at such Time of Delivery, then each non-defaulting
Underwriter, in addition to the number of shares which such non-defaulting
Underwriter agreed to purchase at the Time of Delivery, shall purchase its pro
rata share (based on the number of Shares which such Underwriter agreed to
purchase hereunder) of the Shares of such defaulting Underwriter or Underwriters
for which such arrangements have not been made; but nothing herein shall relieve
a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased
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exceeds 10% of the aggregate number of all of the Shares to be purchased at such
Time of Delivery, then this Agreement (or, with respect to the Second Time of
Delivery, the obligations of the Underwriters to purchase and of the Company to
sell the Optional Shares) shall thereupon terminate, without liability on the
part of any non-defaulting Underwriter or the Company, except for the expenses
to be borne by the Company and the Underwriters as provided in Section 7 hereof
and the indemnity and contribution agreements in Section 9 hereof; but nothing
herein shall relieve a defaulting Underwriter from liability for its default.
12. The respective indemnities, agreements, representations, warranties
and other statements of the Company and the several Underwriters, as set forth
in this Agreement or made by or on behalf of them, respectively, pursuant to
this Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter or the Company,
or any officer or director or controlling person of the Company and shall
survive delivery of and payment for the Shares.
13. If this Agreement shall be terminated pursuant to Section 11 hereof,
the Company shall not then be under any liability to any Underwriter or UBS
Financial Services, as the case may be, except as provided in Sections 7 and 9
hereof; but, if for any other reason any Shares are not delivered by or on
behalf of the Company as provided herein, the Company will reimburse the
Underwriters through you for all out-of-pocket expenses approved in writing by
you, including fees and disbursements of counsel, reasonably incurred by the
Underwriters in making preparations for the purchase, sale and delivery of the
Shares not so delivered (but not for damages on the account of loss of
anticipated profits from the sale by them of the Shares), and the Company shall
then be under no further liability to any Underwriter or UBS Financial Services,
as the case may be, in respect of the Shares not so delivered except as provided
in Sections 7 and 9 hereof.
14. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by you jointly or by either Xxxxxxx, Xxxxx & Co. or UBS Securities LLC on
behalf of the Representatives.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to you as the Representatives in care of [ ], Attention:
Registration Department; and if to the Company shall be delivered or sent by
mail, telex or facsimile transmission to the address of the Company set forth in
the Registration Statement, Attention: Secretary; provided, however, that any
notice to an Underwriter pursuant to Section 9(c) hereof shall be delivered or
sent by mail, telex or facsimile transmission to such Underwriter at its address
set forth in its Underwriters' Questionnaire or telex constituting such
Questionnaire, which address will be supplied to the Company by you on request.
Any such statements, requests, notices or agreements shall take effect upon
receipt thereof.
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15. This Agreement shall be binding upon, and inure solely to the benefit
of, the Underwriters, UBS Financial Services, the Company and, to the extent
provided in Sections 9 and 12 hereof, the officers and directors of the Company
and each person who controls the Company or any Underwriter, and their
respective heirs, executors, administrators, successors and assigns, and no
other person shall acquire or have any right under or by virtue of this
Agreement. No purchaser of any of the Shares from any Underwriter shall be
deemed a successor or assign by reason merely of such purchase.
16. Except as set forth below, no claim may be commenced, prosecuted or
continued in any court other than the courts of the State of New York located in
the City and County of New York or in the United States District Court for the
Southern District of New York, which courts shall have jurisdiction over the
adjudication of such matters, and the Company consents to the jurisdiction of
such courts and personal service with respect thereto. The Company hereby
consents to personal jurisdiction, service and venue in any court in which any
claim arising out of or in any way relating to this Agreement is brought by any
third party against the Underwriters or any indemnified party. Each of the
Company (on its behalf and, to the extent permitted by applicable law, on behalf
of its stockholders and affiliates) and the other parties to this Agreement
waives all right to trial by jury in any action, proceeding or counterclaim
(whether based upon contract, tort or otherwise) in any way arising out of or
relating to this Agreement. The Company agrees that a final judgment in any such
action, proceeding or counterclaim brought in any such court shall be conclusive
and binding upon the Company and may be enforced in any other courts to the
jurisdiction of which the Company is or may be subject, by suit upon such
judgment.
17. Time shall be of the essence of this Agreement. As used herein, the
term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
18. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.
19. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
instrument.
20. The Company is authorized, subject to applicable law, to disclose any
and all aspects of this potential transaction that are necessary to support any
U.S. federal income tax benefits expected to be claimed with respect to such
transaction, and all materials of any kind (including tax opinions and other tax
analyses) related to those benefits, without the Underwriters imposing any
limitation of any kind.
If the foregoing is in accordance with your understanding, please sign and
return to us one for the Company and each of the Representatives hereof, and
upon the acceptance hereof by you, on behalf of each of the Underwriters, this
letter and such acceptance hereof shall constitute a binding agreement among
each of the Underwriters and the Company. It is understood that your acceptance
of this letter on behalf of each of
25
the Underwriters is pursuant to the authority set forth in a form of Agreement
among Underwriters, the form of which shall be submitted to the Company for
examination, upon request, but without warranty on your part as to the authority
of the signers thereof.
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Very truly yours,
International Steel Group Inc.
By:
---------------------------------
Name:
Title:
Accepted as of the date hereof [at ....,
..............:]
Xxxxxxx, Sachs & Co.
By:
-----------------------------------------
(Xxxxxxx, Xxxxx & Co.)
UBS Securities LLC
By:
-----------------------------------------
By:
-----------------------------------------
On behalf of each of the Underwriters
UBS Financial Services Inc.
By:
-----------------------------------------
By:
-----------------------------------------
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