Exhibit 1
THE XXXXXXXX COMPANIES, INC.
$800,000,000 8.625% Senior Notes Due 2010
UNDERWRITING AGREEMENT
June 5, 2003
Xxxxxx Brothers Inc.
Citigroup Global Markets Inc.
X.X. Xxxxxx Securities Inc.
Banc of America Securities LLC
c/x Xxxxxx Brothers Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
The Xxxxxxxx Companies, Inc. (the "COMPANY"), a Delaware corporation,
proposes to issue and sell $800,000,000 aggregate principal amount of its 8.625%
Senior Notes Due 2010 (the "SECURITIES") to the several Underwriters (the
"UNDERWRITERS") named in Schedule I hereto, subject to the conditions
hereinafter stated. The Securities will be issued pursuant to the Senior
Indenture dated as of November 10, 1997 between the Company and JPMorgan Chase
Bank, as successor trustee (the "TRUSTEE") and a Ninth Supplemental Indenture
thereto to be dated as of June 10, 2003 (the "SUPPLEMENTAL INDENTURE"; such
indenture as so amended and supplemented is herein referred to as the
"INDENTURE"). Xxxxxx Brothers, Inc., Citigroup Global Markets Inc., X.X. Xxxxxx
Securities Inc. and Banc of America Securities LLC shall act as representatives
(the "REPRESENTATIVES") of the several Underwriters.
1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to, and agrees with, the several Underwriters that as of
the date hereof and at the Closing Date (as defined herein):
(a) A registration statement on Form S-3 with respect to debt
securities, preferred and common stock of the Company, warrants,
purchase contracts and units (collectively, the "SHELF SECURITIES"),
including the Securities, has (i) been prepared by the Company in
conformity in all material respects with the requirements of the
Securities
Act of 1933, as amended (the "SECURITIES ACT"), and the rules and
regulations (the "RULES AND REGULATIONS") of the Securities and
Exchange Commission (the "COMMISSION") thereunder, (ii) been filed with
the Commission under the Securities Act and (iii) become effective
under the Securities Act. The registration statement includes a
prospectus relating to the Shelf Securities. In addition, the Company
has filed, or will file within the applicable time period set forth in
the Rules and Regulations, with the Commission, a prospectus supplement
specifically relating to the Securities pursuant to Rule 424 of the
Rules and Regulations. The term "REGISTRATION STATEMENT" means the
registration statement as amended to the date of this Agreement. The
term "BASIC PROSPECTUS" means the prospectus included in the
Registration Statement. The term "PROSPECTUS" means the Basic
Prospectus together with the prospectus supplement (other than a
preliminary prospectus supplement) specifically relating to the
Securities, in the form first used to confirm sales of the Securities.
The term "PRELIMINARY PROSPECTUS" means a preliminary prospectus
supplement specifically relating to the Securities, together with the
Basic Prospectus. As used herein, the terms "REGISTRATION STATEMENT",
"BASIC PROSPECTUS", "PROSPECTUS" and "PRELIMINARY PROSPECTUS" shall
include, in each case, the material, if any, incorporated by reference
therein; "EFFECTIVE TIME" means the date and time as of which the
Registration Statement, or the most recent post-effective amendment
thereto, if any, was declared effective by the Commission; "EFFECTIVE
DATE" means the date of the Effective Time; and the terms "SUPPLEMENT",
"AMEND" and "AMENDMENT", as used in this Agreement with respect to the
Registration Statement or the Prospectus, shall include all documents
subsequently filed by the Company with the Commission pursuant to the
Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), that
are deemed to be incorporated by reference in the Prospectus. If the
Company has filed an abbreviated registration statement to register
additional Securities pursuant to Rule 462(b) under the Securities Act
(the "RULE 462 REGISTRATION STATEMENT"), then any reference herein to
the term "REGISTRATION STATEMENT" shall be deemed to include such Rule
462 Registration Statement. To the best of the Company's knowledge, the
Commission has not issued any order preventing or suspending the use of
any Preliminary Prospectus or the effectiveness of the Registration
Statement.
(b) The Registration Statement conforms in all material
respects, and the Prospectus and any further amendments or supplements
to the Registration Statement or the Prospectus will, when they become
effective or are filed with the Commission, as the case may be, conform
in all material respects to the requirements of the Securities Act and
the Rules and Regulations and do not and will not, as of the applicable
Effective
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Date (as to the Registration Statement and any amendment thereto) and
as of the applicable filing date (as to the Prospectus and any
amendment or supplement thereto) contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading (in
the case of the Registration Statement and any amendment thereto) or
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 under which they were
made, not misleading (in the case of the Prospectus any amendment or
supplement thereto); provided that no representation or warranty is
made as to information contained in or omitted from the Registration
Statement or the Prospectus in reliance upon and in conformity with
written information furnished to the Company through the
Representatives by or on behalf of any Underwriter specifically for
inclusion therein.
(c) The Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the State
of Delaware, has the corporate power and authority to own its property
and to conduct its business as described in the Prospectus and is duly
qualified to do business and is in good standing in each jurisdiction
in which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not have a
material adverse effect on the financial condition, results of
operations, business or prospects of the Company and its subsidiaries,
taken as a whole (a "MATERIAL ADVERSE EFFECT");
(d) Each significant subsidiary of the Company (as defined in
Rule 1-02 of Regulation S-X under the Securities Act (each, a
"SIGNIFICANT SUBSIDIARY" and collectively, "SIGNIFICANT SUBSIDIARIES")
has been duly organized or validly formed, is validly existing and in
good standing under the laws of the jurisdiction of its formation or
incorporation, has the power (corporate or other) and authority to own
its property and to conduct its business as described in the Prospectus
and is duly qualified to do business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent
that the failure to be so qualified or be in good standing would not
have a Material Adverse Effect;
(e) The Company and its Significant Subsidiaries each have all
consents, authorizations, approvals, orders, certificates and permits
of and from, and has made all declarations and filings with, all
federal, state, local and other governmental authorities, and all
courts or other tribunals
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(collectively, the "LICENSES") necessary to own, hold, or lease, as the
case may be, and to operate its properties and to carry on its business
as presently conducted, except where the failure to possess such
Licenses could not reasonably be expected to have a Material Adverse
Effect, and neither the Company nor any of its Significant Subsidiaries
has received any notice of proceedings relating to revocation or
modification of any such Licenses, except to the extent that any such
revocation or modification would not have a Material Adverse Effect;
(f) The Company has an authorized capitalization as set forth
in the Prospectus; and all of the issued shares of capital stock of
each Significant Subsidiary (in the case of each Significant Subsidiary
which is a corporation) have been duly authorized and validly issued
and are fully paid and non-assessable and, except as disclosed in the
Prospectus, are owned directly or indirectly by the Company, free and
clear of all liens, encumbrances, equities or claims;
(g) Each of the Company and its Significant Subsidiaries (i)
is in compliance with any and all applicable foreign, federal, state
and local laws and regulations relating to the protection of human
health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants ("ENVIRONMENTAL LAWS"), (ii) has
received all permits, licenses or other approvals required of it under
applicable Environmental Laws to conduct its business as presently
conducted and (iii) is in compliance with all terms and conditions of
any such permit, license or approval, except, with respect to (i), (ii)
and (iii), as may be disclosed in the Prospectus and except where such
noncompliance with Environmental Laws, failure to receive required
permits, licenses or other approvals or failure to comply with the
terms and conditions of such permits, licenses or approvals would not
be reasonably likely to, singly or in the aggregate, have a Material
Adverse Effect;
(h) There has been no storage, disposal, generation,
manufacture, refinement, transportation, handling or treatment of toxic
wastes, medical wastes, hazardous wastes or hazardous substances by the
Company or any of its Significant Subsidiaries (or, to the knowledge of
the Company, any of their predecessors in interest) at, upon or from
any of the property now or previously owned or leased by the Company or
its Significant Subsidiaries in violation of any applicable law,
ordinance, rule, regulation, order, judgment, decree or permit or which
would require remedial action under any applicable law, ordinance,
rule, regulation, order, judgment, decree or permit, except as may be
disclosed in the Prospectus and except for any violation or remedial
action which would not be reasonably likely to have, singularly or in
the aggregate, a Material Adverse Effect; there
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has been no material spill, discharge, leak, emission, injection,
escape, dumping or release of any kind onto such property or into the
environment surrounding such property of any toxic wastes, medical
wastes, solid wastes, hazardous wastes or hazardous substances due to
or caused by the Company or any of its Significant Subsidiaries or with
respect to which the Company or any of its Significant Subsidiaries
have knowledge, except for any such spill, discharge, leak, emission,
injection, escape, dumping or release which would not be reasonably
likely to have, singularly or in the aggregate, a Material Adverse
Effect; and the terms "hazardous wastes", "toxic wastes", "hazardous
substances" and "medical wastes" shall have the meanings specified in
any applicable local, state, federal and foreign laws or regulations
with respect to environmental protection;
(i) The Company has filed all material tax returns which are
required to be filed by it and has paid all taxes due pursuant to such
returns or pursuant to any assessment received by the Company, except
where the same may be contested in good faith by appropriate
proceedings, and where the Company has maintained in accordance with
generally accepted accounting principles appropriate reserves for the
accrual of any of the same. The charges, accruals and reserves on the
books of the Company in respect of taxes or other governmental charges
are, in the opinion of the Company, adequate;
(j) The Company is not, and immediately following the
consummation of the offering of the Securities and the application of
the proceeds therefrom will not be, an "investment company" as such
term is defined in the Investment Company Act of 1940, as amended;
(k) The Indenture has been duly authorized by the Company and,
assuming due authorization, execution and delivery by the Trustee, the
Indenture, when the Supplemental Indenture has been duly executed and
delivered by the Company, will constitute a valid and binding
obligation of the Company, enforceable against the Company in
accordance with its terms, except as the enforceability thereof may be
limited by bankruptcy, insolvency (including, without limitation, all
laws relating to fraudulent transfers), reorganization, moratorium or
similar laws affecting enforcement of creditors' rights generally or by
general principles of equity (regardless of whether considered in a
proceeding in equity or at law); the Indenture has been duly qualified
under the Trust Indenture Act of 1939, as amended;
(l) The Securities have been duly authorized by the Company
and, when executed and authenticated in accordance with the provisions
of
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the Indenture and delivered to and paid for by the Underwriters, will
be entitled to the benefits of the Indenture and will be valid and
binding obligations of the Company, enforceable in accordance with
their terms, except as the enforceability thereof may be limited by
bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium or
similar laws affecting enforcement of creditors' rights generally or by
general principles of equity (regardless of whether considered in a
proceeding in equity or at law);
(m) The Securities will conform in all material respects to
the statements relating thereto contained in the Prospectus and will be
in substantially the form required under the Indenture. The Indenture
will conform in all material respects to the statements relating
thereto contained in the Prospectus;
(n) This Agreement has been duly authorized, executed and
delivered by the Company;
(o) The execution and delivery by the Company of this
Agreement and the Indenture, the issuance and delivery of the
Securities, the consummation by the Company of the transactions
contemplated herein and therein and the compliance by the Company with
the terms of this Agreement, the Indenture and the Securities have been
duly authorized by all necessary action (corporate or other) on the
part of the Company, and do not and will not (i) result in any
violation of the charter or by-laws of the Company or (ii) conflict
with, or result in a breach of any of the terms or provisions of, or
constitute a default or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the Company
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any of its affiliates
is a party or by which the Company or any of its affiliates is bound
(except for such conflicts, breaches or defaults, in the case of this
clause (ii), that could not reasonably be expected to have a Material
Adverse Effect), nor does or will such action result in any violation
of any statute applicable to the Company or any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its properties; and no consent,
approval, authorization, order, registration or qualification of or
with any such court or governmental agency or body is required for the
issuance and sale of the Securities by the Company to the Underwriters
as contemplated by this Agreement, except as may be required by the
securities or Blue Sky laws of the various states in connection with
the offer and sale of the Securities;
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(p) The Company is not (i) in violation of its charter or
by-laws, as applicable, (ii) in default, and no event has occurred
which, with notice or lapse of time or both, would constitute such a
default, in the due performance or observance of any term, obligation,
agreement, covenant or condition contained in any material contract,
indenture, mortgage, deed of trust, loan agreement, lease or other
agreement or instrument to which it is a party or by which it is bound
or which any of its properties or assets may be subject or (iii) in
violation of any law, ordinance, governmental rule, regulation or court
decree to which it or its property or assets may be subject, except
with respect to (ii) or (iii), for any such violations or defaults that
would not be reasonably likely, singly or in the aggregate, to have a
Material Adverse Effect;
(q) The Company has filed all documents with the Commission
that it is required to file under the Securities Act and the Exchange
Act, as applicable, and the rules and regulations of the Commission
thereunder, and such documents conformed in all material respects to
the requirements of the Securities Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission thereunder;
and each document so filed or to be filed and incorporated by reference
in the Prospectus or any further amendment or supplement thereto,
complied or will comply when so filed in all material respects to the
requirements of the Securities Act or the Exchange Act, as applicable,
and the rules and regulations of the Commission thereunder and, when
read together with the other information in the Prospectus, or any
amendment or supplement thereto furnished by the Company, do not or
will not as of the Closing Date, contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading;
(r) Neither the Company nor any of its Significant
Subsidiaries has sustained, since the date of the latest audited
financial statements included or incorporated by reference 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, which would be reasonably likely to result in any
Material Adverse Effect, or any development involving a material
adverse change in or affecting the financial condition, results of
operations, business or prospects of the Company and its subsidiaries,
taken as a whole, otherwise than as set forth or contemplated in the
Prospectus, and, since the respective dates as of which information is
given in the Prospectus or since the date of the Prospectus, there has
not been (i) any change in the capital stock or long-term debt of the
Company
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or any of its subsidiaries, (ii) any material adverse change in or
affecting the financial condition, results of operations, business or
prospects of the Company and its subsidiaries, taken as a whole or
(iii) any transaction entered into by the Company or any of its
Significant Subsidiaries, other than in the ordinary course of
business, that is material to the Company and its subsidiaries, taken
as a whole, otherwise than as disclosed, in each case, in the
Prospectus;
(s) The Company and its Significant Subsidiaries have good and
marketable title in fee simple to, or valid rights of way, easements,
leaseholds, licenses and consents to use, 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 would not reasonably be expected
to, singly or in the aggregate, have a Material Adverse Effect; and all
real property and buildings held under lease by the Company and its
Significant Subsidiaries are held by them under valid, subsisting and
enforceable leases, with such exceptions as would not reasonably be
expected to, singly or in the aggregate, have a Material Adverse Effect
and do not interfere in any material respect with the use made and
proposed to be made of such property and buildings by the Company or
such Significant Subsidiary, as the case may be;
(t) The Company and its Significant Subsidiaries carry, or are
covered by, insurance in such amounts and covering such risks as is
reasonable in accordance with customary practices for companies engaged
in similar businesses in similar industries for the conduct of their
respective businesses and the value of their properties;
(u) The consolidated financial statements filed with or as
part of any document filed with the Commission present fairly in all
material respects the financial position, results of operations and
changes in financial position of the Company and its subsidiaries at
the dates and for the periods indicated, all in conformity with
generally accepted accounting principles (subject, in the case of
interim statements, to normal year-end audit adjustments); and the
Company has no material contingent obligation which is not disclosed in
such financial statements or in the Prospectus;
(v) Ernst & Young LLP, who have reported upon the audited
financial statements and schedules included or incorporated by
reference in the Prospectus, are independent auditors within the
meaning of the rules and regulations promulgated under the Securities
Act;
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(w) The Company (i) makes and keeps books and records which
accurately reflect transactions and dispositions of the Company's
assets and (ii) maintains internal accounting controls which provide
reasonable assurance that (A) transactions are executed in accordance
with management's general or specific authorization, (B) transactions
are recorded as necessary to permit preparation of its financial
statements and to maintain accountability for its assets, (C) access to
its assets is permitted only in accordance with management's general or
specific authorization and (D) the recorded accountability for its
assets is compared with existing assets at reasonable intervals;
(x) (i) The Company has established and maintains disclosure
controls and procedures (as such term is defined in Rule 13a-14 under
the Exchange Act); (ii) such disclosure controls and procedures are
designed to ensure that information required to be disclosed by the
Company in the reports it files or submits under the Exchange Act is
accumulated and communicated to the Company's management, including its
principal executive officer and its principal financial officer, as
appropriate, to allow timely decisions regarding required disclosure;
and (iii) such disclosure controls and procedures are effective in all
material respects to perform the functions for which they were
established;
(y) Since the date of the filing of the Company's Quarterly
Report on Form 10-Q for the quarter ended March 31, 2003, the Company's
auditors and the audit committee of the board of directors of the
Company (or persons fulfilling the equivalent function) have not 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 nor any
material weaknesses in internal controls; and (ii) any fraud, whether
or not material, that involves management or other employees who have a
significant role in the Company's internal controls;
(z) Since the date of the filing of the Company's Quarterly
Report on Form 10-Q for the quarter ended March 31, 2003, 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;
(aa) The Company is in compliance in all material respects
with all presently applicable provisions of the Employee Retirement
Income Security Act of 1974, as amended, including the regulations and
published interpretations thereunder ("ERISA"); no Reportable Event has
occurred with respect to any "pension plan" (as defined by ERISA) for
which the
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Company would have any material liability; the Company has not incurred
and does not expect to incur material liability under (i) Title IV of
ERISA with respect to termination of, or withdrawal from, any "pension
plan" or (ii) Sections 412 or 4971 of the Internal Revenue Code of
1986, as amended, including the regulations and published
interpretations thereunder (the "CODE"); and each "pension plan" for
which the Company would have any liability that is intended to be
qualified under Section 401(a) of the Code is so qualified in all
material respects and nothing has occurred, whether by action or by
failure to act, which would cause the loss of such qualification.
"REPORTABLE EVENT" means any of the events set forth in Section 4043(c)
of ERISA, other than those events described in Section 4043(c)(3) and
other than those events as to which the thirty day notice period is
waived under subsections .22, .24 (solely with respect to partial
termination of a Plan), .27, .28, .29, .30, .31, .32, .34 or .35 of
PBGC Reg. Section 4043) ;
(bb) Other than as set forth or incorporated by reference in
the Prospectus, there is no action, suit or proceeding before or by any
government, governmental instrumentality or court, domestic or foreign,
now pending or, to the knowledge of the Company, threatened against or
affecting the Company or any Significant Subsidiary or to which any of
their respective properties are subject that could reasonably be
expected to result in any Material Adverse Effect, or that could
reasonably be expected to adversely affect the consummation of the
transactions contemplated in this Agreement;
(cc) There are no contracts or other documents which are
required to be described in the Prospectus or filed as exhibits to the
Registration Statement by the Securities Act or by the Rules and
Regulations which have not been described in the Prospectus or filed as
exhibits to the Registration Statement;
(dd) No business or related party transaction exists which is
required by Item 404 of Regulation S-K to be described in the
Prospectus which is not so described;
The Company (i) acknowledges that the Underwriters and, for purposes of
the opinions to be delivered to the Underwriters pursuant hereto, counsel to the
Company and counsel to the Underwriters will rely upon the accuracy and truth of
the foregoing representations and (ii) hereby consents to such reliance.
2. AGREEMENTS TO SELL AND PURCHASE. The Company hereby agrees to
sell and each of the Underwriters, severally and not jointly, upon the basis of
the representations and warranties herein contained, but subject to the
conditions
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hereinafter stated, agrees to purchase the Securities from the Company at
97.525% of their principal amount (the "PURCHASE PRICE") plus accrued interest,
if any, from June 10, 2003 to the date of payment and delivery.
3. PAYMENT AND DELIVERY. Payment for the Securities shall be made
by wire or other immediately available funds to the order of the Company to a
bank account designated by the Company at 10:00 A.M., New York time, on June 10,
2003, or at such other time on the same or such other date, as shall be agreed
by the parties and designated in writing by the Representatives. The time and
date of such payment are herein referred to as the "CLOSING DATE."
Payment for the Securities shall be made against delivery to The
Depository Trust Company or its custodian of one or more global securities
representing the Securities (collectively, the "GLOBAL SECURITIES") registered
in the name of Cede & Co. (the "GLOBAL HOLDER") with any transfer taxes payable
in connection with the transfer of the Securities to the Underwriters duly paid.
Such Global Securities shall be made available to the Representatives for
checking at least twenty four hours prior to the Closing Date, at the offices of
Xxxxx Xxxx & Xxxxxxxx, New York, New York.
4. CONDITIONS TO THE UNDERWRITERS' OBLIGATIONS. The obligations
of the Underwriters are subject to the following conditions:
(a) The Prospectus shall have been timely filed with the
Commission in accordance with Section 5(a); no stop order suspending
the effectiveness of the Registration Statement or any part thereof
shall have been issued and no proceeding for that purpose shall have
been initiated or threatened by the Commission; and any request of the
Commission for inclusion of additional information in the Registration
Statement or the Prospectus or otherwise shall have been complied with.
(b) Subsequent to the execution and delivery of this Agreement
and prior to the Closing Date:
(i) there shall not have occurred any downgrading,
nor shall any notice have been received of (A) any intended or
potential downgrading or (B) any review or possible change
that does not indicate the direction of a possible change, in
the rating accorded any of the securities of the Company by
any "nationally recognized statistical rating organization,"
as such term is defined for purposes of Rule 436(g)(2) under
the Act; and
(ii) there shall not have occurred any material
adverse change, or any development which could reasonably be
expected
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to result in a prospective material adverse change, in the
financial condition, or in the earnings, business or
operations of the Company, from that set forth in the
Prospectus.
(c) The Representatives shall have received on the Closing
Date a certificate, dated the Closing Date and signed by an executive
officer of the Company, to the effect set forth in clauses (b)(i) and
(ii) above and to the effect that the representations and warranties of
the Company contained in this Agreement are true and correct as of the
Closing Date and that the Company has complied with all of the
agreements and satisfied all of the conditions on its part to be
performed or satisfied hereunder on or before the Closing Date.
The person signing and delivering such certificate may rely
upon the best of such person's knowledge after due inquiry as to
proceedings threatened.
(d) The Representatives shall have received on the Closing
Date an opinion of Xxxxx X. Xxxxxx, Esq., Senior Vice President and
General Counsel of the Company, dated the Closing Date, with such
exceptions and qualifications as shall be agreed by the
Representatives, to the effect set forth in Exhibit A.
The opinion of Xxxxx X. Xxxxxx, Esq. described in Exhibit A
shall be rendered to the Representatives at the request of the Company
and shall so state therein.
(e) The Representatives shall have received on the Closing
Date an opinion from Xxxxxx, Xxxx & Xxxxxxxx LLP, special counsel for
the Company, dated the Closing Date, with such exceptions and
qualifications as shall be agreed by the Representatives, to the effect
set forth in Exhibit B.
The opinion of Xxxxxx, Xxxx & Xxxxxxxx LLP described in
Exhibit B shall be rendered to the Representatives at the request of
the Company and shall so state therein.
(f) The Representatives shall have received on the Closing
Date an opinion of Xxxxx Xxxx & Xxxxxxxx, counsel for the Underwriters,
dated the Closing Date, covering the matters referred to in paragraph
10 of Exhibit A, and such other matters as shall be agreed by the
Representatives.
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With respect to paragraph 9 of Exhibit A, Xxxxx Xxxx & Xxxxxxxx may
state that their opinion and belief are based upon their participation in the
preparation of the Prospectus (excluding any documents incorporated by reference
therein) and any amendments or supplements thereto and review and discussion of
the contents thereof, but are without independent check or verification, except
as specified. Xxxxx Xxxx & Xxxxxxxx may also state that they have relied solely
on the opinion of Xxxxx X. Xxxxxx, Esq., as to matters relating to the
regulation of the Company by the Federal Energy Regulatory Commission.
(g) The Representatives shall have received on the Closing
Date a letter, in form and substance satisfactory to the
Representatives, from Ernst & Young LLP, independent public
accountants, containing statements and information of the type
ordinarily included in accountants' "comfort letters" to underwriters
with respect to the financial statements and certain financial
information contained or incorporated by reference in the Prospectus.
5. COVENANTS OF THE COMPANY. In further consideration of the
agreements of the several Underwriters herein contained, the Company covenants
with each Underwriter as follows:
(a) To prepare the Prospectus in a form approved by the
Representatives and to file such Prospectus pursuant to Rule 424(b)
under the Securities Act not later than Commission's close of business
on the second business day following the execution and delivery of this
Agreement; to make no further amendment or any supplement to the
Registration Statement or to the Prospectus except as permitted herein;
to advise the Representatives, 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 the
Representatives with copies thereof; to advise the Representatives,
promptly after it receives notice thereof, of the issuance by the
Commission of any stop order or of any order preventing or suspending
the use of any Preliminary Prospectus or the Prospectus, of the
suspension of the qualification of the Securities for offering or sale
in any jurisdiction, of the initiation or threatening of any proceeding
for any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement or the
Prospectus or for additional information; and, in the event of the
issuance of any stop order or of any order preventing or suspending the
use of any Preliminary Prospectus or the Prospectus or suspending any
such qualification, to use promptly its reasonable best efforts to
obtain its withdrawal;
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(b) To furnish promptly to each of the Representatives and to
counsel for the Underwriters a conformed copy of the Registration
Statement as originally filed with the Commission, and each amendment
thereto filed with the Commission, including all consents and exhibits
filed therewith;
(c) To deliver promptly to the Representatives such number of
the following documents as the Representatives shall reasonably
request: (i) conformed copies of the Registration Statement as
originally filed with the Commission and each amendment thereto (in
each case excluding exhibits) and (ii) each Preliminary Prospectus, the
Prospectus and any amended or supplemented Prospectus; and, if the
delivery of a prospectus is required at any time after the Effective
Time in connection with the offering or sale of the Securities or any
other securities relating thereto and if at such time any events shall
have occurred as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or
omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made when such Prospectus is delivered, not misleading, or, if for
any other reason it shall be necessary to amend or supplement the
Prospectus in order to comply with the Securities Act, to notify the
Representatives and, upon their request, to prepare and furnish without
charge to each Underwriter and to any dealer in securities as many
copies as the Representatives may from time to time reasonably request
of an amended or supplemented Prospectus which will correct such
statement or omission or effect such compliance;
(d) Prior to the termination of the offering of the
Securities, to file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the
Prospectus that may, in the reasonable judgment of the Company or the
Representatives, be required by the Securities Act or requested by the
Commission;
(e) Prior to the termination of the offering of the
Securities, the Company will give the Representatives notice of its
intention to file or prepare any amendment to the Registration
Statement or the Prospectus, whether pursuant to the Securities Act,
the Exchange Act or otherwise, will furnish the Representatives with
copies of any such documents a reasonable amount of time prior to such
proposed filing or use, as the case may be, and will not file or use
any such document to which the Representatives or counsel for the
Underwriters shall reasonably object;
(f) As soon as practicable after the date of this Agreement,
to make generally available to the Company's security holders and to
deliver
14
to the Representatives an earnings statement of the Company and its
subsidiaries (which need not be audited) complying with Section 11(a)
of the Securities Act and the Rules and Regulations (including, at the
option of the Company, Rule 158);
(g) During the period of ninety (90) days from the date of
this Agreement, the Company will not, without the prior written consent
of Xxxxxx Brothers, Inc., offer, sell or contract to sell or otherwise
dispose of, directly or indirectly, or announce the offering of, any
debt securities substantially similar to the Securities or securities
convertible into such debt securities issued or guaranteed by the
Company. The foregoing sentence shall not apply in connection with the
offering and sale of any Securities to the Underwriters pursuant to
this Agreement;
(h) The Company will arrange for the qualification of the
Securities for sale under the laws ("BLUE SKY LAWS") of such states in
the United States as the Representatives designate and will continue
such qualifications in effect so long as required for the resale of the
Securities by the Underwriters; provided that the Company will not be
required to qualify as a foreign corporation or to file a general
consent to service of process in any such state.
(i) The Company consents to the use of the Prospectus, in
accordance with the Prospectus and the Blue Sky Laws of the
jurisdictions in which the Securities are offered by the Underwriters
and by all dealers to whom Securities may be sold, in connection with
the offering and sale of the Securities.
(j) So long as any of the Securities are outstanding, the
Company will furnish to the Representatives (i) promptly after it is
available, upon request, a copy of each report of the Company filed
with any stock exchange or the Commission and (ii) from time to time
such other information concerning the Company as the Representatives
may reasonably request.
(k) The Company and its affiliates have not taken, nor will
any of them take, directly or indirectly, any action designed to or
that might reasonably be expected to cause or result in stabilization
or manipulation of the price of the Securities to facilitate the sale
or resale of the Securities.
(l) The Company will take all reasonable action necessary to
enable Standard & Poor's Ratings Services, a division of The McGraw
15
Hill Companies, Inc. ("S&P"), and Xxxxx'x Investors Service, Inc.
("MOODY'S") to provide their respective ratings of the Securities.
(m) The Company will cooperate with the Representatives and
use its reasonable best efforts to permit the Securities to be eligible
for clearance and settlement through the facilities of The Depository
Trust Company.
(n) The Company will use an amount equal to the net proceeds
from the offering of the Securities solely as set forth under the
caption "Use of Proceeds" in the Prospectus.
(o) The Company will not voluntarily claim, and will resist
actively all attempts to claim, the benefit of any usury laws against
holders of Securities.
(p) Whether or not the transactions contemplated by this
Agreement are consummated or this Agreement is terminated, the Company
will pay all expenses incident to the performance of its obligations
under this Agreement, including: (i) expenses associated with the
preparation, printing and distribution of the Registration Statement
and any post-effective amendments thereto, any Preliminary Prospectus,
the Prospectus and all amendments and supplements thereto; (ii) the
preparation, issuance and delivery of the Securities; (iii) the fees
and disbursements of counsel for the Company and the Company's
accountants and of the Trustee and its counsel; (iv) the costs of
qualification of the Securities under state securities or blue sky laws
in accordance with the provisions of Section 5(i), including filing
fees and the fees and disbursements of counsel for the Underwriters in
connection therewith and in connection with the preparation of any blue
sky or legal investment memoranda; (v) the costs of printing and
delivery to the Underwriters in quantities as herein above stated of
copies of each Preliminary Prospectus, the Prospectus and any
amendments or supplements thereto; (vi) the costs of printing and
delivery to the Underwriters of copies of any blue sky or legal
investment memoranda; (vii) any fees charged by rating agencies for the
rating of the Securities; (viii) any filing fees incident to securing
the review by the National Association of Securities Dealers, Inc. of
the terms of the sale of the Securities; (ix) any expenses incurred by
the Company in connection with any "road show" presentation to
potential investors, including without limitation, expenses associated
with the production of road show slides and graphics, fees and expenses
of any consultants engaged in connection with the road show
presentations with the prior approval of the Company, travel and
lodging expenses of the representatives and officers of the
16
Company and any such consultants, and the cost of any aircraft
chartered in connection with the road show and (x) the performance by
the Company of its other obligations under this Agreement to the extent
not provided for above.
(q) The Company will use its reasonable best efforts to do and
perform all things required or necessary to be done and performed under
this Agreement by it prior to the applicable Closing Date, and to
satisfy all conditions precedent to the Underwriters' obligations
hereunder to purchase the Securities.
6. INDEMNITY AND CONTRIBUTION.
(a) The Company agrees to indemnify and hold harmless each
Underwriter, its directors, its officers, its employees and each
person, if any, who controls such Underwriter within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange
Act, from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses
reasonably incurred by such Underwriter or any such director, officer,
employee or controlling person in connection with defending or
investigating any such action or claim) caused by (i) any untrue
statement or alleged untrue statement of a material fact contained in
the Registration Statement, any Preliminary Prospectus or the
Prospectus (or any amendment or supplement if the Company shall have
furnished any amendments or supplements thereto) or (ii) caused by any
omission or alleged omission to state in the Registration Statement,
any Preliminary Prospectus, the Prospectus or any amendment or
supplement thereto (if the Company shall have furnished any amendments
or supplements thereto) a material fact required to be stated therein
or necessary to make the statements therein not misleading, except
insofar as such losses, claims, damages or liabilities are caused by
any such untrue statement or omission or alleged untrue statement or
omission based upon information relating to any Underwriter furnished
to the Company in writing by such Underwriter through the
Representatives expressly for use in the Registration Statement, any
Preliminary Prospectus or the Prospectus or any amendments or
supplements thereto; provided, however, that the foregoing indemnity
agreement with respect to any Preliminary Prospectus shall not inure to
the benefit of any Underwriter, or any person controlling such
Underwriter, if the person asserting any such losses, claims, damages
or liabilities purchased any Securities from such Underwriter in
connection with the initial distribution thereof and a copy of the
Prospectus (as then amended or supplemented, if the Company shall have
timely furnished any amendment or supplement thereto, but excluding any
documents incorporated by reference therein)
17
was not sent or given by or on behalf of the Underwriters to such
person if required to be delivered under the Securities Act, at or
prior to the written confirmation of the sale of the Securities to such
person, and if such Prospectus (as then amended or supplemented, if
applicable) would have cured the defect giving rise to such losses,
claims, damages or liabilities.
(b) Each Underwriter, severally and not jointly, agrees to
indemnify and hold harmless the Company, its directors, its officers,
its employees and each person, if any, who controls the Company within
the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act to the same extent as the foregoing indemnity from the
Company to the Underwriters, but only with reference to information
relating to such Underwriter furnished to the Company in writing by
such Underwriter through the Representatives expressly for use in the
Registration Statement, any Preliminary Prospectus or the Prospectus or
any amendments or supplements thereto.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of
which indemnity may be sought pursuant to either paragraph (a) or (b)
of this Section 6, such person (the "INDEMNIFIED PARTY") shall promptly
notify the person against whom such indemnity may be sought (the
"INDEMNIFYING PARTY") in writing and the indemnifying party, upon
request of the indemnified party, shall retain counsel reasonably
satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such
proceeding and shall pay the fees and disbursements of such counsel
related to such proceeding. In any such proceeding, any indemnified
party shall have the right to retain its own counsel, but the fees and
expenses of such counsel shall be at the expense of such indemnified
party unless (i) the indemnifying party and the indemnified party shall
have mutually agreed to the retention of such counsel, (ii) the
indemnifying party shall have failed to assume the defense of such
action or employ counsel reasonably satisfactory to the indemnified
party or (iii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the
indemnified party and representation of both parties by the same
counsel would be inappropriate due to actual or potential differing
interests between them. Such firm shall be designated in writing by
Xxxxxx Brothers Inc., in the case of the parties indemnified pursuant
to Section 6(a), and by the Company, in the case of parties indemnified
pursuant to Section 6(b). It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the fees and expenses of
18
more than one separate firm (in addition to any local counsel) for all
such indemnified parties and that all such fees and expenses shall be
reimbursed as they are incurred. The indemnifying party shall not be
liable for any settlement of any proceeding effected without its
written consent (which consent shall not be unreasonably withheld), but
if settled with such consent or if there be a final judgment for the
plaintiff, the indemnifying party agrees to indemnify the indemnified
party from and against any loss or liability by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at
any time an indemnified party shall have requested an indemnifying
party to reimburse the indemnified party for fees and expenses of
counsel as contemplated by the second and third sentences of this
paragraph, the indemnifying party agrees that it shall be liable for
any settlement of any proceeding effected without its written consent
if (i) such settlement is entered into more than 30 days after receipt
by such indemnifying party of the aforesaid request and (ii) such
indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement. No
indemnifying party shall, without the prior written consent of the
indemnified party (which consent shall not be unreasonably withheld),
settle, compromise or consent to the entry of any judgment with respect
to any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such
settlement, compromise or consent includes an unconditional release of
such indemnified party from all liability on claims that are the
subject matter of such proceeding and does not include a statement as
to or an admission of fault, culpability or a failure to act, by or on
behalf of the indemnified party.
(d) To the extent the indemnification provided for in
paragraph (a) or (b) of this Section 6 is unavailable to an indemnified
party or insufficient in respect of any losses, claims, damages or
liabilities referred to therein, then each indemnifying party under
such paragraph, in lieu of indemnifying such indemnified party
thereunder, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or
liabilities (i) 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 hand from the offering and sale of the
Securities or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and of
the Underwriters on the other hand in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities,
as well as any other
19
relevant equitable considerations. The relative benefits received by
the Company on the one hand and the Underwriters on the other hand in
connection with the offering of the Securities shall be deemed to be in
the same respective proportions as the net proceeds from the offering
of the Securities (before deducting expenses) received by the Company
and the total underwriting discounts and commissions received by the
Underwriters, in each case as set forth in the Prospectus, bears to the
aggregate initial offering price of the Securities. The relative fault
of the Company on the one hand and the Underwriters on the other hand
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 or by the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
(e) The Company and the Underwriters agree that it would not
be just or equitable if contribution pursuant to this Section 6 were
determined by pro rata allocation or by any other method of allocation
that does not take account of the equitable considerations referred to
in paragraph (d) of this Section 6. The amount paid or payable by an
indemnified party as a result of the losses, claims, damages and
liabilities referred to in the immediately preceding paragraph shall be
deemed to include, subject to the limitations set forth above, any
legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending or appearing as a third
party witness in any such action or claim. Notwithstanding the
provisions of this Section 6, no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price
of the Securities purchased by it exceeds the amount of any damages
that such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged
omission. The remedies provided for in this Section 8 are not exclusive
and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity.
(f) The indemnity and contribution provisions contained in
this Section 6 and the representations, warranties and other statements
of the Company contained in this Agreement shall remain operative and
in full force and effect regardless of (i) any termination of this
Agreement, (ii) any investigation made by or on behalf of any
Underwriter or any person controlling any Underwriter or by or on
behalf of the Company, its officers or directors or any person
controlling the Company and (iii) acceptance of and payment for any of
the Securities.
20
(g) Each Underwriter, severally and not jointly, confirms and
the Company acknowledges that the statements with respect to the
offering of the Securities by such Underwriter set forth on the last
paragraph of the cover page and the third, fourth, fifth, eighth, ninth
and tenth paragraphs of text under "Underwriting" in the Prospectus are
correct and constitute the only information concerning such Underwriter
furnished in writing to the Company by or on behalf of such Underwriter
specifically for inclusion in the Registration Statement and the
Prospectus.
7. DEFAULTING UNDERWRITERS. If, on the Closing Date, any
Underwriter defaults in the performance of its obligations under this Agreement,
the remaining non-defaulting Underwriters shall be obligated to purchase the
Securities which the defaulting Underwriter agreed but failed to purchase on the
Closing Date in the respective proportions which the number of Securities set
opposite the name of each remaining non-defaulting Underwriter in Schedule 1
hereto bears to the total number of Securities set opposite the names of all the
remaining non-defaulting Underwriters in Schedule 1 hereto; provided, however,
that the remaining non-defaulting Underwriters shall not be obligated to
purchase any of the Securities on the Closing Date if the total number of
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase on such date exceeds 9.09% of the total number of Securities to be
purchased on the Closing Date, and any remaining non-defaulting Underwriter
shall not be obligated to purchase more than 110% of the number of Securities
which it agreed to purchase on the Closing Date pursuant to the terms of Section
2. If the foregoing maximums are exceeded, the remaining non-defaulting
Underwriters, or those other underwriters satisfactory to the Representatives
and the Company who so agree shall have the right, but shall not be obligated,
to purchase, in such proportion as may be agreed upon among them, all the
Securities to be purchased on the Closing Date. If the remaining Underwriters or
other underwriters satisfactory to the Representatives and the Company do not
elect to purchase the Securities which the defaulting Underwriter or
Underwriters agreed but failed to purchase on the Closing Date, this Agreement
shall terminate without liability on the part of any non-defaulting Underwriter
or the Company, except that the Company will continue to be liable for the
payment of expenses to the extent set forth in Sections 5 and 10. As used in
this Agreement, the term "UNDERWRITER" includes, for all purposes of this
Agreement unless the context requires otherwise, any party not listed in
Schedule I hereto who, pursuant to this Section 7, purchases Securities which a
defaulting Underwriter agreed but failed to purchase.
Nothing contained herein shall relieve a defaulting Underwriter of any
liability it may have to the Company for damages caused by its default. If other
underwriters are obligated or agree to purchase the Securities of a defaulting
or withdrawing Underwriter, either the Representatives or the Company may
21
postpone the Closing Date for up to seven full business days in order to effect
any changes that in the opinion of counsel for the Company or counsel for the
Underwriters may be necessary in the Registration Statement, the Prospectus or
in any other document or arrangement.
8. TERMINATION. This Agreement shall be subject to termination by
notice given by the Representatives to the Company, if (a) after the execution
and delivery of this Agreement and prior to the Closing Date any of the events
described in Section 4(b) shall have occurred or (b) (i) trading generally shall
have been suspended or materially limited on or by, as the case may be, any of
the New York Stock Exchange, the American Stock Exchange, the National
Association of Securities Dealers, Inc., the Chicago Board of Options Exchange,
the Chicago Mercantile Exchange or the Chicago Board of Trade, (ii) trading of
any securities of the Company shall have been suspended on any exchange or in
any over-the-counter market, (iii) a general moratorium on commercial banking
activities in New York shall have been 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 shall have occurred or
(iv) there shall have occurred any outbreak or escalation of hostilities
(including, without limitation, an act of terrorism) or any material adverse
change in general economic, political or financial conditions (or the effect of
international conditions on the financial markets in the United States shall be
such) as to make it, in the judgment of the Representatives, impracticable or
inadvisable to proceed with the offering, sale or delivery of the Securities on
the terms and in the manner contemplated in the Prospectus. Notice of such
cancellation shall be given to the Company by telecopy or telephone but shall be
subsequently confirmed by letter.
9. EFFECTIVENESS. This Agreement shall become effective upon the
execution and delivery hereof by the parties hereto.
10. REIMBURSEMENT OF THE UNDERWRITERS' EXPENSES. If this Agreement
shall be terminated by the Representatives because of any failure or refusal on
the part of the Company to comply with the terms or to fulfill any of the
conditions of this Agreement, or if for any reason the Company shall be unable
to perform its obligations under this Agreement, the Company will reimburse the
Underwriters for all out-of-pocket expenses (including the reasonable fees and
disbursements of their counsel) reasonably incurred by the Underwriters in
connection with this Agreement and the offering contemplated hereunder.
11. NOTICES. All statements, requests, notices and agreements
hereunder shall be in writing, and:
22
(a) if to the Underwriters, shall be delivered or sent by
mail, telex or facsimile transmission to Xxxxxx Brothers Inc., 000 Xxxx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Syndicate
Department (Fax: 000-000-0000) with a copy, in the case of any notice
pursuant to Section 8(c), to the Director of Litigation, Office of the
General Counsel, Xxxxxx Brothers Inc., 000 Xxxx Xxxxxx, 00xx Xxxxx, Xxx
Xxxx, XX 00000;
(b) if to the Company, shall be delivered or sent by mail,
telex or facsimile transmission c/o The Xxxxxxxx Companies, Inc., Xxx
Xxxxxxxx Xxxxxx, Xxxxx, Xxxxxxxx 00000, Attention: Treasurer (Fax:
000-000-0000).
Any such statements, requests, notices or agreements shall take effect
at the time of receipt thereof.
12. SUCCESSORS. This Agreement shall inure to the benefit of and
be binding upon the Underwriters, the Company and their respective successors.
This Agreement and the terms and provisions hereof are for the sole benefit of
only those persons, except that (A) the representations, warranties, indemnities
and agreements of the Company contained in this Agreement shall also be deemed
to be for the benefit of the person or persons, if any, who control any
Underwriter within the meaning of Section 15 of the Securities Act. Nothing in
this Agreement is intended or shall be construed to give any person, other than
the persons referred to in this Section 12, any legal or equitable right, remedy
or claim under or in respect of this Agreement or any provision contained
herein.
13. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter of this
Agreement and supersedes all prior agreements and understandings, both oral and
written, between the parties with respect to the subject matter of this
Agreement.
14. PARTIAL UNENFORCEABILITY. If any section, paragraph or
provision of this Agreement is for any reason determined to be invalid or
unenforceable, such determination shall not affect the validity or
enforceability of any other section, paragraph or provision hereof.
15. COUNTERPARTS. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
16. APPLICABLE LAW. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York.
23
17. HEADINGS. The headings of the sections of this Agreement have
been inserted for convenience of reference only and shall not be deemed a part
of this Agreement.
24
Please confirm that the foregoing correctly sets forth the agreement
among the Company and the Underwriters.
Very truly yours,
THE XXXXXXXX COMPANIES, INC.
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President and Chief Executive
Officer
Accepted as of the date hereof:
By: XXXXXX BROTHERS INC.
CITIGROUP GLOBAL MARKETS INC.
X.X. XXXXXX SECURITIES INC.
BANC OF AMERICA SECURITIES LLC
For themselves and as Representatives
of the several Underwriters named
in Schedule I hereto.
By: XXXXXX BROTHERS INC.
/s/ Xxxxxx Xxxxxx
--------------------------------
Name: Xxxxxx Xxxxxx
Title: Senior Vice President
SCHEDULE I
Number of Securities
Underwriter to be Purchased
Xxxxxx Brothers Inc............................. $266,666,667
Citigroup Global Markets Inc.................... 161,616,162
X.X. Xxxxxx Securities Inc...................... 113,131,313
Banc of America Securities LLC.................. 64,646,465
Scotia Capital (USA) Inc........................ 56,565,657
Credit Lyonnais Securities (USA) Inc............ 44,444,444
TD Securities (USA) Inc......................... 44,444,444
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated 16,161,616
The Royal Bank of Scotland plc.................. 16,161,616
BOSC, Inc....................................... 8,080,808
Xxxxxx Xxxxxxx & Co. Incorporated............... 8,080,808
------------
Total.......................... $800,000,000
------------
EXHIBIT A
OPINION OF XXXXX X. XXXXXX, ESQ.,
SENIOR VICE PRESIDENT AND GENERAL COUNSEL OF
THE XXXXXXXX COMPANIES, INC.
1. The Company and each of its Significant Subsidiaries have been
duly incorporated or otherwise validly organized or validly formed and are
validly existing in good standing under the laws of their respective
jurisdictions of formation or incorporation, have the requisite power and
authority to own their property and to conduct their business as described in
the Prospectus and are duly qualified to do business and are in good standing in
each jurisdiction in which their respective ownership or lease of property or
the conduct of their respective businesses requires such qualification, except
to the extent such failure to be qualified or in good standing would not
reasonably be expected to have a Material Adverse Effect, and all of the issued
shares of capital stock of each Significant Subsidiary that is a corporation
have been duly and validly authorized and issued and are fully paid,
non-assessable and are owned directly or indirectly by the Company, free and
clear of all liens, encumbrances, equities or claims;
2. To the best of such counsel's knowledge, the Company and its
Significant Subsidiaries each have all Licenses necessary to own, hold, or
lease, as the case may be, and to operate their respective properties and to
carry on their respective businesses as presently conducted, except where the
failure to possess such Licenses could not reasonably be expected to have a
Material Adverse Effect, and, to the best of such counsel's knowledge, neither
the Company nor any of its subsidiaries has received any notice of proceedings
relating to revocation or modification of any such Licenses, except to the
extent that any such revocation or modification could not reasonably be expected
to have a Material Adverse Effect;
3. The Company is not in violation of its charter or bylaws, and,
to the best of such counsel's knowledge, the Company is not (i) in default, and
no event has occurred which, with notice or lapse of time or both, would
constitute such a default, in the due performance or observance of any term,
covenant or condition contained in any Material Contract, or (ii) in violation
of any law, ordinance, governmental rule, regulation or court decree to which it
or its property or assets may be subject, except as disclosed in the Prospectus,
and in the case of (i) and (ii), for such defaults or violations as are not
reasonably expected to have a Material Adverse Effect;
4. Each of the Underwriting Agreement, the Indenture and the
Securities have been duly authorized, executed, and delivered by the Company.
5. The execution and delivery by the Company of, and the
performance by the Company of its obligations under, the Underwriting Agreement,
the Securities and the Indenture will not contravene any law applicable to the
Company, or the Certificate of Incorporation or By-laws of the Company or any
Material Contract, or any judgment, order, decree of any governmental body,
agency or court having jurisdiction over the Company. This paragraph 5 does not
include any opinion regarding any federal or state securities or Blue Sky laws
or regulations.
6. The Company has filed all documents with the Commission that
it is required to file under the Exchange Act and the rules and regulations of
the Commission thereunder;
7. To the best of such counsel's knowledge, other than as set
forth or incorporated by reference in the Prospectus, there is no action, suit
or proceeding before or by any government, governmental instrumentality or
court, domestic or foreign, now pending or threatened against the Company or to
which any of its properties are subject that could reasonably be expected to
result in any Material Adverse Effect, or that could reasonably be expected to
adversely affect the consummation of the transactions contemplated by the
Underwriting Agreement;
8. After due inquiry, such counsel does not know of any legal or
governmental proceeding pending or threatened to which the Company or any of its
subsidiaries is subject which is required to be described or of any contract or
other document which is required to be described in the Registration Statement
or the Prospectus or to be filed as an exhibit to the Registration Statement
which is not described or filed as required; and
9. Such counsel shall state that such counsel or personnel under
such counsel's supervision have participated in conferences with officers and
other representatives of the Company, the Company's outside counsel,
representatives of the independent auditors for the Company, your
representatives and your counsel at which the contents of the Registration
Statement and the Prospectus and related matters were discussed and has made
such other investigation as such counsel has deemed necessary and, although such
counsel is not passing upon, and does not assume any responsibility for, the
accuracy, completeness or fairness of the statements contained or incorporated
by reference in the Registration Statement or the Prospectus; on the basis of
the foregoing, no facts have come to such counsel's attention that have led such
counsel to believe that (a) the Registration Statement and the Prospectus (in
each case excluding (x) the Incorporated Documents and (y) the Trustee's
Statement of Eligibility on Form T-
1 (as to which such counsel expresses no opinion)), as amended or supplemented,
if applicable, did not comply as to form, when filed, in all material respects
with the requirements of the Securities Act and the rules and regulations of the
Commission thereunder, (b) the Incorporated Documents did not comply as to form,
when filed, in all material respects with the requirements of the Exchange Act
and the rules and regulations of the Commission thereunder, (c) the Registration
Statement, on the date of the Underwriting Agreement, contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or to make the statements therein not misleading, or (d) the
Prospectus, as amended or supplemented, if applicable, as of its date or as of
the date hereof, contained or contains any untrue statement of a material fact
or omitted or omits to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading, except that with respect to each of clauses (a)-(d), such
counsel need not express an opinion or belief with respect to the financial
statements, schedules and other financial and accounting data included or
incorporated by reference in the Registration Statement or the Prospectus. In
addition, such counsel shall state that such counsel has been advised by the
staff of the Commission that the Registration Statement has been declared
effective under the Act by the Commission and the Indenture qualified under the
Trust Indenture Act of 1939, as amended.
"INCORPORATED DOCUMENTS" means the Company's Annual Report on Form 10-K for the
year ended December 31, 2002 and all other reports filed by the Company pursuant
to Section 13(a) or 15(d) of the Exchange Act since the end of the fiscal year
covered by such Annual Report.
"MATERIAL CONTRACT" means all agreements and instruments included in the list of
exhibits in the Company's Annual Report on Form 10-K for the year ended December
31, 2002, Quarterly Report on Form 10-Q for the quarter ended March 31, 2003 and
Current Reports on Form 8-K filed subsequent to such Annual Report (except for
employment agreements, stock option plans, stock election plans, stock incentive
plans, officer and director indemnification agreements and deferred compensation
plans, all of which are excluded).
EXHIBIT B
OPINION OF XXXXXX XXXX & XXXXXXXX LLP
1. The Securities, when executed and authenticated in accordance
with the terms of the Indenture and delivered to and paid for by the
Underwriters in accordance with the terms of the Underwriting Agreement, will be
entitled to the benefits of the Indenture and will be valid and binding
obligations of the Company, enforceable against the Company in accordance with
their respective terms.
2. The Indenture constitutes a valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms.
3. The issuance of the Securities and the execution, delivery and
performance by the Company of the Underwriting Agreement, the Indenture and the
Securities do not violate, or require any filing with or approval of any
governmental authority or regulatory body of the State of New York or the United
States of America under, any law or regulation of the State of New York or the
United States of America applicable to the Company that, in our experience, is
generally applicable to transactions in the nature of those contemplated by the
Underwriting Agreement. This paragraph 3 does not include any opinion regarding
any federal or state securities or Blue Sky laws or regulations.
4. The execution, delivery and performance by the Company of the
Underwriting Agreement, the Securities and the Indenture will not violate (i)
the Certificate of Incorporation or By-laws of the Company, (ii) the terms of
any Material Contract, or (iii) any order, judgment or decree of any court or
other agency of government identified to such counsel in an officers'
certificate of the Company as constituting all orders, judgments or decrees
binding on the Company and attached to such opinion. This paragraph 4 does not
include any opinion regarding any federal or state securities or Blue Sky laws
or regulations.
5. The Company is not, and immediately after giving effect to the
offering of the Securities and the application of the proceeds therefrom as
contemplated by the Prospectus will not be, an "investment company" as such term
is defined in the Investment Company Act of 1940, as amended.
6. Such counsel shall state that such counsel believes that the
Indenture and the Securities conform in all material respects with the
descriptions thereof contained in the Prospectus.
7. Such counsel shall also state that such counsel has
participated in conferences with officers and other representatives of the
Company, representatives of the independent auditors for the Company, your
representatives and your counsel at which the contents of the Registration
Statement and the Prospectus and related matters were discussed (provided that
such may state that the Registration Statement and the Basic Prospectus, and the
documents incorporated by reference in the Registration Statement and the
Prospectus, were prepared and filed by the Company without the participation of
such counsel) and, although such counsel is not passing upon, and does not
assume any responsibility for, the accuracy, completeness or fairness of the
statements contained or incorporated by reference in the Registration Statement
or the Prospectus except as stated in paragraph 6 above, on the basis of the
foregoing, no facts have come to such counsel's attention that have led such
counsel to believe that (a) the Registration Statement and the Prospectus (in
each case excluding (x) the documents incorporated by reference therein and (y)
the Trustee's Statement of Eligibility on Form T-1 (as to which such counsel
expresses no opinion)), as amended or supplemented, if applicable, did not
comply as to form, when filed, in all material respects with the requirements of
the Securities Act and the rules and regulations of the Commission thereunder,
(b) the Registration Statement, on the date of the Underwriting Agreement,
contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or to make the statements therein not
misleading, or (c) the Prospectus, as amended or supplemented, if applicable, as
of its date or as of the date hereof, contained or contains any untrue statement
of a material fact or omitted or omits to state a material fact necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading, except that with respect to each of clauses
(a)-(c), such counsel need not express an opinion or belief with respect to the
financial statements, schedules and other financial and accounting data included
or incorporated by reference in the Registration Statement or the Prospectus. In
addition, such counsel shall state that such counsel has been advised by the
staff of the Commission that the Registration Statement has been declared
effective under the Act by the Commission and the Indenture qualified under the
Trust Indenture Act of 1939, as amended. Xxxxxx, Xxxx & Xxxxxxxx LLP may also
state that they do not express any opinion regarding any federal or state laws
or regulations applicable to entities operating in the energy industry,
including regulations of the Federal Energy Regulatory Commission.
"MATERIAL CONTRACT" means all agreements and instruments included in the list of
exhibits in the Company's Annual Report on Form 10-K for the year ended December
31, 2002, Quarterly Report on Form 10-Q for the quarter ended March 31, 2003 and
Current Reports on Form 8-K filed subsequent to such Annual Report (except for
employment agreements, stock option plans, stock election plans, stock incentive
plans, officer and director indemnification agreements and deferred compensation
plans, all of which are excluded).
