Grupo Simec, S.A.B. de C.V. [ ] Series B Common Shares In the form of Series B Common Shares or American Depositary Shares each representing three Series B Common Shares Plus an option to purchase from the Company up to [ ] additional Series B Common...
Exhibit
1.1
Grupo
Simec, S.A.B. de C.V.
[ ]
Series B Common Shares
In
the
form of Series B Common Shares or American Depositary Shares
each
representing three Series B Common Shares
Plus
an
option to purchase from the Company up to
[ ]
additional
Series B Common Shares or American Depositary Shares
each
representing three Series B Common Shares to cover over-allotments
Underwriting
Agreement
,
2007
Citigroup
Global Markets Inc.
As
Representative of the several Underwriters,
c/o
Citigroup Global Markets Inc.
000
Xxxxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Ladies
and Gentlemen:
Grupo
Simec, S.A.B. de C.V., a corporation (sociedad
anónima bursátil de capital variable)
duly
organized and validly existing under the laws of Mexico (the “Company”),
proposes to sell to the several underwriters named in Schedule
I
hereto
(the “Underwriters”),
for
whom you (the “Representative”)
are
acting as representative, an aggregate of [ ] Series B Common Shares, no
par value (“Series
B Shares”),
of
the Company (said shares to be issued and sold by the Company being hereinafter
called the “Underwritten
Shares”).
The
Company also proposes to grant to the Underwriters an option to purchase up
to
[ ]
additional Series B Shares solely to cover over-allotments, if any (the
“Option
Shares”
and,
together with the Underwritten Shares, the “Shares”).
It
is
understood that the Company is concurrently entering into an underwriting
agreement (the “Mexican
Underwriting Agreement”
and,
together with this Underwriting Agreement, the “Global
Underwriting Agreements”)
providing for the sale
to
Acciones y Valores Banamex, S.A. de C.V., Casa de Bolsa, Integrante del Grupo
Financiero Banamex, and IXE Casa de Bolsa, S.A. de C.V., IXE Grupo Financiero
(the “Mexican
Underwriters”)
by the
Company of an aggregate of [ ] Series B Shares (the Series B
Shares to be sold by the Company pursuant to the Mexican Underwriting Agreement
being hereinafter called the “Mexican
Underwritten Shares”)
and
providing for the grant to the Mexican Underwriters of an option to purchase
from the Company up to [ ] additional Series B Shares (the
“Mexican
Option Shares”,
together with the Option Shares, the “Global
Option Shares”;
the
Mexican Option Shares together with the Mexican Underwritten Shares, the
“Mexican
Shares”
and
together with the Shares, the “Global
Shares”).
You
have
advised the Company that the Underwriters may elect to cause the Company to
deposit on their behalf all or any portion of the Series B Shares to be
purchased by them hereunder pursuant to the Deposit Agreement, dated as
of June 30, 1993, as amended and restated as of February 20, 2003 (the
“Deposit
Agreement”),
entered into among the Company, The Bank of New York, as depositary (the
“Depositary”)
and
all Holders and Beneficial Owners from time to time of the ADSs (as hereinafter
defined) issued thereunder. Upon deposit of any Series B Shares with Nacional
Financiera, S.N.C., as Mexican custodian for the Depository (the “Mexican
Custodian”), the Depositary will issue American depositary shares (the
“ADSs”)
representing the Shares so deposited. The ADSs will be evidenced by American
depositary receipts (the “ADRs”).
Each
ADS will represent three Series B Shares and each ADR may represent any
number of ADSs. Unless the context otherwise requires, the terms “Underwritten
Shares”, “Global Underwritten Shares”, “Option Shares”, “Global Option Shares”,
“Shares”, “Mexican Underwritten Shares,” “Mexican Option Shares,” “Mexican
Shares” and “Global Shares,” shall be deemed to refer, in each case, to any ADSs
representing such securities and the ADRs evidencing such ADSs.
It
is
further understood and agreed that the Mexican Underwriters and the Underwriters
(collectively, the “Global
Underwriters”)
have
entered into an Agreement Between Underwriters and the Mexican Underwriters
dated as of the date hereof (the “Agreement Between Underwriters and Mexican
Underwriters”), pursuant to which, among other things, the Mexican Underwriters
may purchase from the Underwriters a portion of the Securities to be sold
pursuant to this Underwriting Agreement and the Underwriters may purchase from
the Mexican Underwriters a portion of the Mexican Securities to be sold pursuant
to the Mexican Underwriting Agreement.
To
the
extent there are no additional Underwriters listed on Schedule I
other
than you, the term Representative as used in this Underwriting Agreement shall
mean you, as Underwriter, and the terms Representative and Underwriters shall
mean either the singular or plural as the context requires. The use of the
neuter in this Underwriting Agreement shall include the feminine and masculine
wherever appropriate. Certain terms used in this Underwriting Agreement are
defined in Section 24 hereof.
1. Representations
and Warranties.
The
Company represents and warrants to, and agrees with, each Underwriter as set
forth below in this Section 1.
-
2 -
(a) Registration.
The
Company has prepared and filed with the Commission a registration
statement (file number 333-138239) on Form F-l, including the
related International Preliminary Prospectus, for registration under the Act
of
the offering and sale of the Global Shares. Such Registration Statement,
including any amendments thereto filed prior to the Execution Time, has become
effective. The Company may have filed one or more amendments thereto, including
the related International Preliminary Prospectus, each of which has previously
been furnished to you. The Company will file with the Commission a Final
International Prospectus in accordance with Rule 424(b). As filed, such Final
International Prospectus shall contain all information required by the Act
and
the rules thereunder and, except to the extent the Representative shall agree
in
writing to a modification, shall be in all substantive respects in the form
furnished to you prior to the Execution Time or, to the extent not completed
at
the Execution Time, shall contain only such specific additional information
and
other changes (beyond that contained in the latest International Preliminary
Prospectus) as the Company has advised you, prior to the Execution Time, will
be
included or made therein.
It
is
understood that two forms of prospectus are to be used in connection with the
offering and sale of the Global Shares: one form of prospectus relating to
the
Shares, which are to be offered and sold outside of Mexico, and one form of
prospectus relating to the Mexican Shares, which are to be offered and sold
in
Mexico. The Mexican Prospectus does not and will not, as of the date of the
Mexican Prospectus and any amendment or supplement thereto, contain any untrue
statement of a material fact or omit to state any 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. The immediately
preceding sentence does not apply to statements in or omissions from the Mexican
Prospectus based upon written information furnished to the Company by any
Underwriter through the Representative specifically for use therein, in being
understood and agreed that the only such information is that described in
Section 8 hereof.
(b) No
Material Misstatements or Omissions in Registration Statement.
On the
Effective Date, the Registration Statement did, and when the International
Prospectus is first filed in accordance with Rule 424(b) and the Closing Date
(as defined herein) and on any date on which Global Option Shares are purchased,
if such date is not the Closing Date (a “Settlement
Date”),
the
International Prospectus (and any supplements thereto) will, comply in all
material respects with the applicable requirements of the Act and the rules
thereunder; on the Effective Date and at the Execution Time, the Registration
Statement and the ADR Registration Statement did not or will not contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary in order to make the statements therein not
misleading; and on the date of any filing pursuant to Rule 424(b) and on
the Closing Date and any Settlement Date, the International Prospectus (together
with any supplement
-
3 -
thereto)
will not, include any untrue statement of a material fact or omit to state
a
material fact necessary in order to make the statements therein, in the light
of
the circumstances under which they were made, not misleading; provided,
however,
that
the Company makes no representations or warranties as to the information
contained in or omitted from the Registration Statement, the ADR Registration
Statement, the Disclosure Package or the International Prospectus (or any
supplement thereto) in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of any Underwriter through
the Representative specifically for inclusion in the Registration Statement,
the
ADR Registration Statement, the Disclosure Package or the International
Prospectus (or any supplement thereto), it being understood and agreed that
the
only such information furnished by any Underwriter consists of the information
described as such in Section 8 hereof.
(c) ADR
Registration Statement.
The
Company has filed with the Commission a registration statement (file number
333-48173) on Form F-6 for the registration under the Act of the offering and
sale of the ADSs. The Company may have filed one or more amendments thereto,
each of which has previously been furnished to you. Such ADR Registration
Statement at the time of its effectiveness did or will comply and on the Closing
Date, will comply, in all material respects with the applicable requirements
of
the Act and the rules thereunder and at the time of its Effective Date and
at
the Execution Time, did not and will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading.
(d) Deposit
Agreement.
Upon
issuance by the Depositary of ADSs evidenced by ADRs against deposit of
Underlying Shares in accordance with the provisions of the Deposit Agreement,
including deposit with the Mexican Custodian, such ADRs will be duly and validly
issued and persons in whose names the ADRs are registered will be entitled
to
the rights specified in the ADRs and in the Deposit Agreement; and upon the
sale
and delivery to the Global Underwriters of the Global Shares, and payment
therefor, pursuant to the Global Underwriting Agreements, the Underwriters
will
acquire good, marketable and valid title to such Shares, free and clear of
all
pledges, liens, security interests, charges, claims or encumbrances of any
kind.
(e) No
Material Misstatements or Omissions in Disclosure Package. As
of the
date hereof and as of the Closing Date, (i) the Disclosure Package and the
price
to the public, the number of Global Underwritten Shares (defined as the
Underwritten Shares together with the Mexican Underwritten Shares) and the
number of Global Option Shares, to be included on the cover page of the
prospectus when taken together as a whole, and (ii) each electronic roadshow
when taken together as a whole with the Disclosure Package, and the price to
the
public, the number of Global Underwritten Shares and the number of Global Option
Shares, to be included on the cover page of the prospectus does
not
-
4 -
contain
any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The preceding sentence
does not apply to statements in or omissions from the Disclosure Package based
upon and in conformity with written information furnished to the Company by
any
Underwriter through the Representative specifically for use therein, it being
understood and agreed that the only such information furnished by or on behalf
of any Underwriter consists of the information described as such in Section
8(b)
hereof.
(f) Company
not Ineligible Issuer.
(i) At
the time of filing the Registration Statement and (ii) as of the Execution
Time
(with such date being used as the determination date for purposes of this clause
(ii)), the Company was not and is not an Ineligible Issuer (as defined in Rule
405), without taking account of any determination by the Commission pursuant
to
Rule 405 that it is not necessary that the Company be considered an Ineligible
Issuer.
(g) Conformity
with Registration Statement and ADR Registration Statement.
Any
Issuer Free Writing Prospectus prepared and filed pursuant to Section 5(b)
hereto does
not
include any information that conflicts with the information contained in the
Registration Statement and the ADR Registration Statement, including any
document incorporated by reference therein that has not been superseded or
modified. The foregoing sentence does not apply to statements in or omissions
from any Issuer Free Writing Prospectus based upon and in conformity with
written information furnished to the Company by any Underwriter through the
Representative specifically for use therein,
it being
understood and agreed that the only such information furnished by any
Underwriter consists of the information described as such in Section 8(b)
hereof.
(h) Formation
and Qualification of the Company.
The
Company has been duly incorporated and is a validly existing corporation
(sociedad
anónima bursátil de capital variable),
under
the laws of Mexico with full corporate power and authority to own or lease,
as
the case may be, and to operate its properties and conduct its business in
all
material respects as described in the Disclosure Package and the International
Prospectus. The Company does not have operations directly in any jurisdiction
in
which its ownership or leasing of property or the conduct of its business
required it to be in good standing as a foreign corporation.
(i) Capitalization.
The
Company’s authorized equity capitalization is as set forth in the International
Preliminary Prospectus and the International Prospectus; the capital stock
of
the Company conforms to the description thereof contained in the Disclosure
Package and the International Prospectus; all outstanding Series B Shares
(including the Global Shares to be sold pursuant to the Global Underwriting
Agreements) have been duly and validly authorized and issued and as of the
date
hereof, except for the Global Shares, are fully subscribed, paid and
non-assessable (liberadas); the Global Shares have been duly and
validly
-
5 -
authorized,
and, when the Global Shares are delivered to and paid for by the Underwriters
pursuant to this Underwriting Agreement or the Mexican Underwriting Agreement,
will conform in all material respects to the descriptions thereof contained
in
the International Preliminary Prospectus and the International Prospectus and
will be validly issued, fully paid and non-assessable (liberadas); the ADSs
are
duly listed, and admitted and authorized for trading, subject to official notice
of issuance, on the American Stock Exchange; the certificates for the Series
B
Shares are in valid and sufficient form; the holders of outstanding shares
of
capital stock of the Company are not entitled to preemptive or other rights
to
subscribe for the Shares; and, except as set forth in the International
Preliminary Prospectus and the International Prospectus (exclusive of any
supplement thereto), no options, warrants or other rights to purchase,
agreements or other obligations to issue, or rights to convert any obligations
into or exchange any securities for, shares of capital stock of or ownership
interests in the Company are outstanding.
(j) No
Restrictions. There
are
no restrictions on subsequent transfers of the Global Shares under the laws
of
Mexico.
(k) Subsidiaries.
Other
than the subsidiaries listed on Schedule II hereto, the Company has no
“subsidiaries” as such term is defined in Regulation S-X under the Act. Each of
the Company’s subsidiaries has been duly incorporated and is a validly existing
corporation in good standing, where applicable, under the laws of the
jurisdiction in which it is chartered or organized with full corporate power
and
authority to own or lease, as the case may be, and to operate its properties
and
conduct its business in all material respects as described in the Disclosure
Package and the International Prospectus; and , where applicable, each
subsidiary is duly qualified to do business as a foreign corporation in good
standing in all other jurisdictions in which its ownership or leasing of
property or the conduct of its business requires such qualification, except
where the failure so to register or qualify would not reasonably be expected
to
have a Material Adverse Effect. “Material Adverse Effect,” as used throughout
this Underwriting Agreement, means a material adverse effect on the condition
(financial or otherwise), results of operations, earnings, business, properties
or assets or prospects of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of
business.
(l) Passive
Foreign Investment Company.
The
Company was not a Passive Foreign Investment Company (“PFIC”) within the meaning
of Section 1296 of the United States Internal Revenue Code of 1986, as
amended, for the year ended December 31, 2006 and does not expect to become
a
PFIC for the year ended December 31, 2007.
(m) Subsidiary
Capitalization.
All the
outstanding shares of capital stock of each subsidiary have been duly authorized
and validly issued and are fully paid and non-assessable, and, except as
otherwise set forth in the Disclosure
-
6 -
Package
and International Prospectus, all outstanding shares of capital stock of the
subsidiaries are owned by the Company either directly or through wholly owned
subsidiaries free and clear of any security interest, claim, lien or
encumbrance.
(n) Contracts
to be Described or Filed.
There is
no franchise, contract or other document of a character required to be described
in the Registration Statement, ADR Registration Statement, the International
Preliminary Prospectus or the International Prospectus, or to be filed as an
exhibit to the Registration Statement or the ADR Registration Statement, which
is not described or filed as required (and the International Preliminary
Prospectus contains in all material respects the same description of the
foregoing matters contained in the International Prospectus); and the statements
in the International Preliminary Prospectus and the International Prospectus
under the headings “Risk Factors,” “Dividends and Dividend Policy,” “Business,”
“Description of Capital Stock,” “Description of American Depositary Receipts”
and “Taxation,” insofar as such statements summarize legal matters, agreements,
by-laws (estatutos),
documents or proceedings discussed therein, are accurate and fair summaries
of
such legal matters, agreements, by-laws (estatutos),
documents or proceedings.
(o) Due
Authorization.
Each of
the Global Underwriting Agreements and the Deposit Agreement has been duly
authorized, validly executed and delivered by the Company. The Mexican
Underwriting Agreement has been duly authorized, executed and delivered by
the
Company and constitutes the legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms and constitutes
a
legal valid and binding obligation of the Company, enforceable against it in
accordance with its terms, subject to (A) applicable concurso
mercantil, bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws
relating to or affecting creditors’ rights generally and by general principles
of equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law) and (B) public policy, applicable law relating
to fiduciary duties and indemnification and an implied covenant of good faith
and fair dealing.
(p) Investment
Company.
The
Company is not and, after giving effect to the offering and sale of the Global
Shares and the application of the proceeds thereof as described in the
Preliminary Prospects and the Prospectus, will not be an “investment company” as
defined in the Investment Company Act of 1940, as amended.
(q) No
Consents.
No
consent, approval, authorization, filing with or order (“Consent”)
of any
court or governmental agency or body in the United States, Mexico or any other
foreign jurisdiction, is required in connection with the transactions
contemplated herein, or in the Deposit Agreement, except (i) such as have
been obtained under the Act and the Exchange Act, all of which are in full
force
and effect, (ii) and the Ley del Xxxxxxx de Valores (the “Mexican
Securities Law”)
and
other applicable Mexican securities laws and regulations including
the
-
7 -
rules
and
regulations of the Mexican Stock Exchange (Bolsa
Mexicana de Valores, S.A. de C.V.),
including the approval to register the Global Shares in the National Securities
Registry (Registro
Nacional de Valores)
conduct
the public offering of the Mexican Shares in Mexico, all of which are in full
force and effect; (iii) such as may be required under the securities laws or
the
blue sky laws of any jurisdiction in connection with the purchase and
distribution of the Shares by the Underwriters in the manner contemplated herein
and in the Disclosure Package and the International Prospectus.
(r) No
Defaults.
The
Company is not (i) in violation of any provision of its charter or bylaws,
or similar organizational documents; (ii) in violation or in default under
(and no event that, with notice or lapse of time or both, would constitute
such
a default has occurred or is continuing under) the terms of any indenture,
contract, lease, mortgage, deed of trust, note agreement, loan agreement or
other agreement or instrument to which it is a party or bound or to which its
property is subject; or (iii) in violation of any statute, law, rule,
regulation, judgment, order or decree of any court, regulatory body,
administrative agency, governmental body, arbitrator or other authority, as
applicable, which default or violation, in the case of clause (ii) or
(iii), would, if continued, reasonably be expected to have a Material Adverse
Effect, or materially impair the ability of the Company to perform its
obligations under the Global Underwriting Agreements or the Deposit
Agreement.
(s) No
Conflicts.
Neither
the issue and sale of the Global Shares nor the consummation of any other of
the
transactions herein contemplated nor the fulfillment of the terms hereof or
of
the Mexican Underwriting Agreement or of the Deposit Agreement will
(i) conflict with, or result in a violation of, the charter or by-laws of
the Company or any of its Subsidiaries; (ii) conflict with, or result in a
breach or violation of, the terms of any indenture, contract, lease, mortgage,
deed of trust, note agreement, loan agreement or other agreement, obligation,
condition, covenant or instrument to which the Company or any of its
Subsidiaries is a party or bound or to which its property is subject, which
will
be obtained on or prior to the Closing Date; (iii) violate any statute,
law, rule, regulation, judgment, order or decree applicable to the Company
or
any of its Subsidiaries of any court, regulatory body, administrative agency,
governmental body, arbitrator or other authority; or (iv) result in the
creation or imposition of any lien, charge or encumbrance upon any property
or
assets of the Company or any of its Subsidiaries, which conflicts, breaches,
violations, defaults or liens, in the case of clause (ii), (iii) or
(iv), would, individually or in the aggregate, reasonably be expected to have
a
Material Adverse Effect.
(t) No
Registration Rights.
No
holders of securities of the Company have rights to (i) the registration of
such
securities under the Registration Statement, the ADR Registration Statement
or
the registration request filed by the Company with the CNBV, or (ii) require
the
Company to include such securities in the securities registered pursuant to
any
registration filed by the Company
-
8 -
under
the
Mexican Securities Market Law or any other applicable securities
legislation.
(u) Financial
Statements.
The
consolidated financial statements of the Company included in the International
Preliminary Prospectus, the International Prospectus and the Registration
Statement present fairly in all material respects the financial condition,
results of operations and changes in financial position of the entities
purported to be shown thereby on the basis stated therein as of the dates and
for the periods indicated, comply as to form in all material respects with
the
applicable accounting requirements of the Act and have been prepared in
conformity with Mexican generally accepted accounting principles, reconciled
as
appropriate to reflect, U.S. generally accepted accounting principles,
applied on a consistent basis throughout the periods involved (except as
otherwise noted therein). The selected financial data set forth under the
caption “Selected Consolidated Financial Information” in the International
Preliminary Prospectus and the International Prospectus fairly present, the
information included therein, on the basis stated. The unaudited pro forma
financial statements of operations included in the International Preliminary
Prospectus and the International Prospectus include assumptions that provide
a
reasonable basis for presenting the significant effects directly attributable
to
the transactions and events described therein, the related pro forma adjustments
give appropriate effect to those assumptions, and the pro forma adjustments
reflect the proper application of those adjustments to the historical financial
statement amounts in the unaudited pro forma condensed combined statements
of
operations included in the International Preliminary Prospectus and the
International Prospectus. The unaudited pro forma condensed combined statements
of operations included in the International Preliminary Prospectus on pages
[·]
and the
International Prospectus on pages [·]
comply
as to form in all material respects with the applicable accounting requirements
of Regulation S-X under the Act. The unaudited pro forma condensed consolidated
financial information in Annex I to the Preliminary International Prospectus
and
the International Prospectus does not need to comply with the applicable
accounting requirements of Regulation S-X under the Act. The forward-looking
statements contained under the captions “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” in the International Preliminary
Prospectus and the International Prospectus reflect the Company’s good faith
beliefs and/or estimates with respect to the matters described in such
statements and are based upon (A) the Company’s analysis of such factors as
it deemed relevant to such statements and (B) such assumptions as the
Company deemed reasonable with respect to such statements.
(v) Litigation.
No
action, suit or proceeding by or before any court or governmental agency,
authority or body, or any arbitrator involving the Company or any of its
Subsidiaries or its or their property is pending or, to the best knowledge
of
the Company, threatened that (i) would reasonably be expected to have a
Material Adverse Effect on the consummation of any of the
transactions
-
9 -
contemplated
by the Global Underwriting Agreements or the Deposit Agreement or
(ii) would reasonably be expected to have a Material Adverse
Effect.
(w) Assets.
On or
as of the Closing Date each of the Company and its Subsidiaries will own, lease,
possess or otherwise have the right to all such assets as are necessary to
the
conduct of its operations presently conducted as described in the International
Preliminary Prospectus and the International Prospectus.
(x) Independent
Accountants.
KPMG
LLP, Xxxxxxx, S.C., KPMG Xxxxxxxx Xxxxx, S.C., BDO Xxxxxxx LLP and BDO Xxxxxxxxx
Xxxxxx y Cía., S.A., all of whom have audited certain financial statements of
each of the Company and its consolidated Subsidiaries and delivered their report
with respect to the financial statements included in the International
Preliminary Prospectus and the International Prospectus as described under
the
caption “Experts” in the International Preliminary Prospectus and the
International Prospectus, were the independent registered public accounting
firms with respect to the Company and its direct and indirect subsidiaries
or
PAV Republic, Inc. and its direct and indirect subsidiaries, as applicable,
within the meaning of the Act and the applicable published rules and regulations
thereunder.
(y) Tax
Returns.
Each of
the Company and its Subsidiaries has filed all federal, state and local tax
returns in the United States, Mexico, Canada or any other jurisdiction, as
the
case may be, that are required to be filed or has requested extensions thereof
(except in any case in which the failure so to file would not reasonably be
expected to have a Material Adverse Effect, except as set forth in or
contemplated in the Disclosure Package and the International Prospectus
(exclusive of any supplement thereto)), and has paid all taxes required to
be
paid by it and any other assessment, fine or penalty levied against it, to
the
extent that any of the foregoing is due and payable, except for any such
assessment, fine or penalty that is currently being contested in good faith
and
as to which the Company has set aside adequate reserves in accordance with
Mexican generally accepted accounting principles or as would not reasonably
be expected to have a Material Adverse Effect, except as set forth in or
contemplated in the Disclosure Package and the International
Prospectus.
(z) No
Labor Dispute.
No
labor problem or dispute with the employees of the Company or any of its
Subsidiaries exists or, to the knowledge of the Company, is threatened or
imminent, and the Company is not aware of any existing or imminent labor
disturbance by the employees of any of its principal suppliers, contractors
or
customers, that would reasonably be expected to have a Material Adverse Effect,
except as set forth in or contemplated in the Disclosure Package and the
International Prospectus.
(aa) Insurance.
The
Company and each of its Subsidiaries is insured by insurers of recognized
financial responsibility against such losses and risks and in such amounts
as
are reasonably adequate and customary in the businesses in
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10 -
which
it
is engaged; as of the Closing Date, all policies of insurance and fidelity
or
surety bonds insuring the Company and each of its Subsidiaries or its or their
businesses, assets, employees, officers and directors will be in full force
and
effect; as of the Closing Date, the Company and each of its Subsidiaries will
be
in compliance with the terms of such policies and instruments in all material
respects; and there are no claims by the Company under any such policy or
instrument as to which any insurance company or other institution is denying
liability or defending under a reservation of rights clause; none of the Company
or any of its Subsidiaries has been refused any insurance coverage sought or
applied for; and the Company has no reason to believe that it will not be able
to renew its existing insurance coverage as and when such coverage expires
or to
obtain similar coverage from similar insurers as may be necessary to continue
its business at a cost that would not reasonably be expected to have a Material
Adverse Effect, except as set forth in or contemplated in the Disclosure Package
and the International Prospectus.
(bb) Permits.
The
Company and each of its Subsidiaries possess, or at the Closing Date will
possess, all licenses, certificates, permits and other authorizations
(“Permits”)
issued
by the appropriate federal, state or foreign regulatory authorities necessary
to
conduct its businesses in the manner described in the Disclosure Package and
the
International Prospectus, subject to such qualifications as may be set forth
in
the Disclosure Package and the International Prospectus and except for
(i) such Permits, that are not customarily obtained or made prior to the
consummation of transactions such as those contemplated by the Global
Underwriting Agreements, the Mexican Underwriting Agreement and the Deposit
Agreement, which (A) if not obtained on or prior to the Closing Date, would
not, individually or in the aggregate, have a material adverse effect on the
operation of the Company’s business and (B) are expected in the reasonable
judgment of the Company to be obtained in the ordinary course of business
subsequent to the consummation of the transactions, and (ii) those permits
that if not obtained, would not reasonably be expected to have a Material
Adverse Effect; and the Company has not received any notice of proceedings
relating to the revocation or modification of any such Permit which, singly
or
in the aggregate, if the subject of an unfavorable decision, ruling or finding,
would have a Material Adverse Effect, except as set forth in or contemplated
in
the Disclosure Package and the International Prospectus.
(cc) Books
and Records.
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 authorizations;
(ii) transactions are recorded as necessary to permit preparation of
financial statements in conformity with Mexican generally accepted
accounting principles and to maintain asset accountability; (iii) access to
assets is permitted only in accordance with management’s general or specific
authorization; and (iv) the recorded accountability for assets is compared
with the
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11 -
existing
assets at reasonable intervals and appropriate action is taken with respect
to
any differences.
(dd) Market
Stabilization.
The
Company has not taken, directly or indirectly, any action designed to or that
would constitute or that might reasonably be expected to cause or result in,
under the Exchange Act or otherwise, stabilization or manipulation of the price
of any security of the Company to facilitate the sale or resale of the Global
Shares.
(ee) Disclosure
Controls.
The
Company and each of its Subsidiaries maintain “disclosure controls and
procedures” (as such term is defined in Rule 13a-15(e) under the Exchange Act);
such disclosure controls and procedures are effective.
(ff) Environmental
Compliance.
Except
as set forth in or contemplated in the Disclosure Package and the International
Prospectus (exclusive of any supplement thereto), the Company and each of its
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 and is in compliance with all permits, licenses or other
approvals required of it under applicable Environmental Laws to conduct its
businesses and (iii) has not received notice of any actual or potential
liability under any environmental law, except where such non-compliance with
Environmental Laws, failure to receive required permits, licenses or other
approvals, or liability would not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect. Except as set forth in the
Disclosure Package and the International Prospectus (exclusive of any supplement
thereto), the Company has not been named as a “potentially responsible party”
under the Comprehensive Environmental Response, Compensation, and Liability
Act
of 1980, as amended.
(gg) Effect
of Environmental Laws.
Each of
the Company and its Subsidiaries has reviewed costs and liabilities associated
with compliance of Environmental Laws on the business, operations and properties
of the Company and its Subsidiaries. On the basis of such review, the Company
has reasonably concluded that such associated costs and liabilities would not,
singly or in the aggregate, reasonably be expected to have a Material Adverse
Effect, except as set forth in or contemplated in the Disclosure Package and
the
International Prospectus.
(hh) Xxxxxxxx-Xxxxx
Act of 2002.
The
Company and its directors and officers, in their capacities as such, are in
compliance in all material respects with all applicable provisions of the
Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations promulgated in
connection therewith (the “Xxxxxxxx-Xxxxx
Act”)
that
are effective and applicable to the Company and its directors and
officers,
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12 -
including
Section 402 related to loans and Sections 302 and 906 related to
certifications.
(ii) Employee
Retirement Income Security Act of 1974.
The
minimum funding standard under Section 302 of the Employee Retirement Income
Security Act of 1974, as amended, and the regulations and published
interpretations thereunder (“ERISA”),
has
been satisfied by each “pension plan” (as defined in Section 3(2) of ERISA)
which has been established or maintained by the Company, which is subject to
such minimum funding standards, and the trust forming part of each such plan
which is intended to be qualified under Section 401 of the Code has been
determined by the Internal Revenue Service to be so qualified and each of the
Company and PAV Republic, Inc. and its Subsidiaries have fulfilled their
respective obligations, if any, under Section 515 of ERISA; none of the Company
nor any of its Subsidiaries maintains or is required to contribute to a “welfare
plan” (as defined in Section 3(1) of ERISA) which provides retiree or other
post-employment welfare benefits or insurance coverage (other than “continuation
coverage” (as defined in Section 602 of ERISA)); each pension plan and welfare
plan established or maintained by the Company or any of its Subsidiaries is
in
compliance in all material respects with the currently applicable provisions
of
ERISA; none of the Company or any of its Subsidiaries has not incurred or could
not reasonably be expected to incur any withdrawal liability under
Section 4201 of ERISA, any liability under Section 4062, 4063, or 4064 of
ERISA, or any other liability under Title IV of ERISA.
(jj) Foreign
Corrupt Practices Act.
None of
the Company nor any of its Subsidiaries nor, to the knowledge of the Company,
any director, officer, agent, employee or affiliate of the Company or any of
its
Subsidiaries is aware of or has taken any action, directly or indirectly, that
would result in a violation by such persons of the Foreign Corrupt Practices
Act
of 1977, as amended, and the rules and regulations thereunder (the
“FCPA”),
including, without limitation, making use of the mails or any means or
instrumentality of interstate commerce corruptly in furtherance of an offer,
payment, promise to pay or authorization of the payment of any money, or other
property, gift, promise to give, or authorization of the giving of anything
of
value to any “foreign official” (as such term is defined in the FCPA) or any
foreign political party or official thereof or any candidate for foreign
political office, in contravention of the FCPA and the Company, its Subsidiaries
and, to the knowledge of the Company, its affiliates have conducted their
businesses in compliance with the FCPA and have instituted and maintain policies
and procedures designed to ensure, and which are reasonably expected to continue
to ensure, continued compliance therewith.
(kk) Money
Laundering Laws.
The
operations of the Company and each of its Subsidiaries are and have been
conducted at all times in compliance with applicable financial recordkeeping
and
reporting requirements of the Currency and Foreign Transactions Reporting Act
of 1970, as amended, the money laundering statutes of all jurisdictions,
the rules and regulations thereunder
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13 -
and
any
related or similar rules, regulations or guidelines, issued, administered or
enforced by any governmental agency (collectively, the “Money
Laundering Laws”)
and no
action, suit or proceeding by or before any court or governmental agency,
authority or body or any arbitrator involving the Company or any of its
Subsidiaries with respect to the Money Laundering Laws is pending or, to the
best knowledge of the Company, threatened.
(ll) OFAC.
None of
the Company nor any of its Subsidiaries nor, to the knowledge of the Company,
any director, officer, agent, employee or affiliate of the Company or any of
its
Subsidiaries is currently subject to any U.S. sanctions administered by the
Office of Foreign Assets Control of the U.S. Treasury Department
(“OFAC”);
and
none of the Company nor any of its Subsidiaries will directly or indirectly
use
the proceeds of the offering, or lend, contribute or otherwise make available
such proceeds to any subsidiary, joint venture partner or other person or
entity, for the purpose of financing the activities of any person currently
subject to any U.S. sanctions administered by OFAC.
(mm) Intellectual
Property.
As of
the Closing Date, the Company and each of its Subsidiaries will own, possess,
license or have other rights to use, on reasonable terms, all patents, patent
applications, trade and service marks, trade and service xxxx registrations,
trade names, copyrights, licenses, inventions, trade secrets, technology,
know-how and other intellectual property (collectively, the “Intellectual
Property”)
necessary for the conduct of the Company’s or any of its Subsidiaries'
businesses as presently conducted, except where the failure to possess such
rights would not reasonably be expected to have a Material Adverse Effect,
and
has no reason to believe that the conduct of its businesses will conflict with,
and has not received any notice of any claim of conflict with, any such rights
of others.
(nn) Taxes.
No
stamp or other issuance or transfer taxes or duties and no capital gains,
income, withholding or other taxes are payable by or on behalf of the
Underwriters in connection with (A) the delivery of the Global Shares in
the manner contemplated by the Global Underwriting Agreements, (B) the
deposit with the Depositary of the Series B Shares against issuance of the
ADRs
evidencing the ADSs or (C) the sale and delivery by the Global Underwriters
of the Global Shares or the ADSs, as the case may be, as contemplated
herein.
(oo) Dividends
and Distributions.
All
dividends and other distributions declared and payable on the Series B Shares
under the current laws and regulations of Mexico and any political subdivisions
thereof, will be paid in the lawful currency of Mexico and may be converted
into
foreign currency and may be freely transferred out of Mexico in accordance
with
the Deposit Agreement, and, except as set forth in the International Preliminary
Prospectus and the International Prospectus, all such dividends and other
distributions will not be subject to withholding or other taxes under the laws
and regulations of Mexico and are otherwise free and clear of any other tax,
withholding or deduction and
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14 -
without
the necessity of obtaining any consents, approvals, authorizations, orders,
licenses, registrations, clearances and qualifications of or with any
governmental agency or body in Mexico.
(pp) No
Material Adverse Change.
Since
the date of the latest audited financial statements included in the Disclosure
Package and the International Prospectus and other than as set forth in or
contemplated by the Disclosure Package and the International Prospectus,
(i) none of the Company nor any of its Subsidiaries has sustained 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, investigation, order or decree, (ii) there
has not been, any material change in the capitalization or material increase
in
the short-term debt or long-term debt of the Company or any of its Subsidiaries
or any material adverse change, or any development involving or which could
reasonably be expected to involve, individually or in the aggregate, a
prospective material adverse change in or affecting the general affairs,
condition (financial or otherwise), results of operations, business, properties
or assets or prospects of the Company or any of its Subsidiaries, taken as
a
whole, and (iii) none of the Company nor any of its Subsidiaries has
incurred any liability or obligation, direct, indirect or contingent, or entered
into any transactions, whether or not in the ordinary course of business, that,
individually or in the aggregate, are material to the Company, or otherwise
than
as set forth or contemplated in the Disclosure Package and the International
Prospectus (exclusive of any supplement thereto).
(qq) Prohibition
on Dividends.
Except
as set forth in the Disclosure Package and the International Prospectus, neither
the Company, nor any of its Subsidiaries, are prohibited, directly or
indirectly, from paying any dividends, from making any other distribution,
from
repaying any loans or advances or from transferring any of its property or
assets.
(rr) Statistical
and Market Data.
The
statistical and market-related data included in the International Preliminary
Prospectus and the International Prospectus are based on or derived from sources
which the Company believes to be reliable and accurate.
(ss) Immunity.
Neither
the Company nor any of its Subsidiaries nor any of its or their properties
or
assets has any immunity from the jurisdiction of any court or from any legal
process (whether through service or notice, attachment prior to judgment,
attachment in aid of execution or otherwise) under the laws of the United
States, Mexico or any political subdivisions thereof.
(tt) Enforceability
of Deposit Agreement.
The
Deposit Agreement has been duly authorized, validly executed and delivered
by
the Company and The Bank of New York and is a valid and binding agreement of
the
Company enforceable against it in accordance with its terms, subject to
(A) applicable
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15 -
concurso
mercantil, bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws
relating to or affecting creditors’ rights generally and by general principles
of equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law) and (B) public policy, applicable law relating
to fiduciary duties and indemnification and an implied covenant of good faith
and fair dealing.
(uu) Except
as
disclosed in the Registration Statement, the Disclosure Package and the
International Prospectus, the Company does not have any material lending or
other relationship with any entity, which to the knowledge of the Company,
is a
bank or lending affiliate of any Global Underwriter.
Any
certificate signed by any officer of the Company and delivered to the
Representative or counsel for the Representative in connection with the offering
of the Shares shall be deemed a representation and warranty by the Company,
as
to matters covered thereby, to each Underwriter.
2. Purchase
and Sale.
(a)
Subject
to the terms and conditions and in reliance upon the representations and
warranties set forth in this Underwriting Agreement, the Company agrees to
sell
to each Underwriter, and each Underwriter agrees, severally and not jointly,
to
purchase from the Company, at a purchase price of
$[ ] per Share, the amount of the Underwritten
Shares set forth opposite such Underwriter’s name in Schedule I
to this
Underwriting Agreement.
(b)
Subject to the terms and conditions and in reliance upon the representations
and
warranties set forth in this Underwriting Agreement, the Company hereby grants
an option to the several Underwriters to purchase, severally and not jointly,
up
to [ ] Option Shares at the same purchase price per Share as the
Underwriters shall pay for the Underwritten Shares. Said option may be exercised
only to cover over-allotments in the sale of the Global Underwritten Shares
by
the Global Underwriters. Said option may be exercised in whole or in part at
any
time on or before the 30th day after the date of the International Prospectus
upon written or telegraphic notice by the Representative to the Company setting
forth the number of shares of the Option Shares as to which the several
Underwriters are exercising the option and the settlement date. The number
of
Option Shares to be purchased by each Underwriter shall be the same percentage
of the total number of shares of the Option Shares to be purchased by the
several Underwriters as such Underwriter is purchasing of the Underwritten
Shares, subject to such adjustments as you in your absolute discretion shall
make to eliminate any fractional Shares.
3. Delivery
and Payment.
Delivery of and payment for the Underwritten Shares and the Option Shares (if
the option provided for in Section 2(b) hereof shall have been exercised on
or before the third Business Day prior to the Closing Date) shall be made at
10:00 AM, New York City time, on [ ], 2007, or at such time on
such later date not more than three Business Days after the foregoing date
as
the Representative shall designate, which date and time may be postponed by
agreement among the
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16 -
Representative
and the Company or as provided in Section 9 hereof (such date and time of
delivery and payment for the Shares being called in this Underwriting Agreement
the “Closing
Date”).
Delivery of Shares shall be made to Mexican Custodian in the case of the ADSs
and to the Custodian of the Representative in the case of the Series B Shares
against payment by the several Underwriters through the Representative of the
respective aggregate purchase prices of the Shares being sold by the Company
to
or upon the order of the Company by wire transfer payable in same-day funds
to
the accounts specified by the Company.
If
the
option provided for in Section 2(b) hereof is exercised after the third
Business Day prior to the Closing Date, the Company will deliver (at the expense
of the Company) to the Representative, at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx, xx the date specified by the Representative (which shall be
within three Business Days after exercise of said option), certificates for
the
Option Shares through the facilities of Indeval, in the case of the Series
B
Shares, and through the facilities of DTC, in the case of the ADSs, in such
names and denominations as the Representative shall have requested for the
respective accounts of the several Underwriters, against payment by the several
Underwriters through the Representative of the purchase price thereof to or
upon
the order of the Company by wire transfer payable in same-day funds to the
accounts specified by the Company. If settlement for the Option Shares occurs
after the Closing Date, the Company will deliver to the Representative on the
settlement date for the Option Shares, and the obligation of the Underwriters
to
purchase the Option Shares shall be conditioned upon receipt of, supplemental
opinions, certificates and letters confirming as of such date the opinions,
certificates and letters delivered on the Closing Date pursuant to
Section 6 hereof.
Delivery
of Series B Shares and Option Shares on the Closing Date shall be made through
the facilities of S.D. Indeval, S.A. de C.V., Instituto para el Depósito de
Valores (“Indeval”),
and
delivery of ADSs shall be made through the facilities of DTC.
It
is
understood and agreed that the Closing Date shall occur simultaneously with
the
purchase and sale of the Mexican Underwritten Shares under the Mexican
Underwriting Agreement, and that the settlement date for any Option Shares
occurring after the Closing Date, shall occur simultaneously with the settlement
date under the Mexican Underwriting Agreement for any Mexican Option Shares
occurring after the Closing Date.
4.
Offering
by Underwriters.
It is
understood that the several Underwriters propose to offer the Shares for sale
to
the public as set forth in the International Prospectus.
5.
Agreements.
(i) The
Company agrees with the several Underwriters that:
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17 -
(a) Preparation
of International Prospectus, Registration Statement and ADR Registration
Statement.
The
Company will use its best efforts to cause the Registration Statement and the
ADR Registration Statement, if not effective at the Execution Time, and any
amendment thereof, to become effective. Prior to the termination of the offering
of the Global Shares, the Company will not file any amendment of the
Registration Statement or the ADR Registration Statement or supplement to the
Disclosure Package or the International Prospectus or any Rule 462(b)
Registration Statement unless the Company has furnished the Representative
a
copy for review by the Representative prior to filing and will not file any
such
proposed amendment or supplement to which the Representative reasonably objects.
Subject to the foregoing sentence, if the Registration Statement or the ADR
Registration Statement has become or becomes effective pursuant to
Rule 430A, or filing of the Disclosure Package or the International
Prospectus is otherwise required under Rule 424(b), the Company will cause
the
Disclosure Package and the International Prospectus, properly completed, and
any
supplement thereto to be filed in a form approved by the Representative with
the
Commission pursuant to the applicable paragraph of Rule 424(b) within the
time period prescribed and will provide evidence satisfactory to the
Representative of such timely filing. The Company will promptly advise the
Representative (1) when the Registration Statement and the ADR Registration
Statement, if not effective at the Execution Time, shall have become effective,
(2) when the Disclosure Package or the International Prospectus, and any
supplement thereto, shall have been filed (if required) with the Commission
pursuant to Rule 424(b) or when any Rule 462(b) Registration Statement or ADR
Registration Statement shall have been filed with the Commission, (3) when,
prior to termination of the offering of the Global Shares, any amendment to
the
Registration Statement or the ADR Registration Statement shall have been filed
or become effective, (4) of any request by the Commission or its staff for
any amendment of the Registration Statement, or any Rule 462(b)
Registration Statement or the ADR Registration Statement, or for any supplement
to the Disclosure Package or the International Prospectus or for any additional
information, (5) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the ADR
Registration Statement or the institution or threatening of any proceeding
for
that purpose and (6) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Global Shares for sale
in
any jurisdiction or the institution or threatening of any proceeding for such
purpose. The Company will use its best efforts to prevent the issuance of any
such stop order or the suspension of any such qualification and, if issued,
to
obtain as soon as possible the withdrawal thereof.
(b) Disclosure
Package. If,
at
any time prior to the filing of the Prospectuses pursuant to Rule 424(b), any
event occurs as a result of which the Disclosure Package would include any
untrue statement of a material fact or omit to state any material fact necessary
to make the statements therein in the light of the circumstances under which
they were made, the Company will (i) notify
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18 -
promptly
the Representatives so that any use of the Disclosure Package may cease until
it
is amended or supplemented; (ii) amend or supplement the Disclosure Package
to
correct such statement or omission; and (iii) supply any amendment or supplement
to you in such quantities as you may reasonably request.
(c) Filing
of Amendment or Supplement.
If, at
any time when a prospectus relating to the Global Shares is required to be
delivered under the Act (including in circumstances where such requirement
may
be satisfied pursuant to Rule 172), any event occurs as a result of which the
Prospectus as then supplemented would include any untrue statement of a material
fact or omit to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, or if it shall be necessary to amend the Registration Statement
or
the ADR Registration Statement or supplement the Prospectus to comply with
the
Act or the rules thereunder, the Company promptly will (1) notify the
Representative of any such event; (2) prepare and file with the Commission,
subject to the second sentence of paragraph (i)(a) of this Section 5,
an amendment or supplement which will correct such statement or omission or
effect such compliance; and (3) supply any amendment or supplement to you
in such quantities as you may reasonably request.
(d) Selling
Materials. The
Company will furnish to the Representative and to each other Underwriter, so
long as delivery of a prospectus by an Underwriter or dealer may be required
by
the Act, as many copies of each International Preliminary Prospectus,
International Prospectus and any Issuer Free Writing Prospectus and any
supplement thereto as the Representative may reasonably request.
(e) Qualification
of Global Shares.
The
Company will arrange, if necessary, for the qualification of the Global Shares
for sale under the laws of such jurisdictions as the Representative may
designate and will maintain such qualifications in effect so long as required
for the distribution of the Global Shares; provided
that in
no event shall the Company be obligated to qualify to do business in any
jurisdiction where it is not now so qualified or to take any action that would
subject it to service of process in suits, other than those arising out of
the
offering or sale of the Shares, in any jurisdiction where it is not now so
subject.
(f) Lock-Up
Period; Lock-Up Letters.
The
Company will not, without the prior written consent of the Representative,
offer, sell, contract to sell, pledge, or otherwise dispose of, (or enter into
any transaction which is designed to, or might reasonably be expected to, result
in the disposition (whether by actual disposition or effective economic
disposition due to cash settlement or otherwise) by the Company or any
affiliate of the Company or any person in privity with the Company or any
affiliate of the Company) directly or indirectly, including the filing (or
participation in the filing) of a registration statement with the
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19 -
Commission
in respect of, or establish or increase a put equivalent position or liquidate
or decrease a call equivalent position within the meaning of Section 16 of
the
Exchange Act, any Series B Shares or ADSs or any securities convertible into,
or
exercisable, or exchangeable for, Series B Shares or ADSs; or publicly announce
an intention to effect any such transaction, for a period of 180 days
after the date of this Underwriting Agreement, provided,
however,
that
the Company may issue and sell Series B Shares pursuant to any employee stock
option plan, stock ownership plan or dividend reinvestment plan of the Company
in effect at the Execution Time and the Company may issue Series B Shares
issuable upon the conversion of securities or the exercise of warrants
outstanding at the Execution Time. Notwithstanding the foregoing, if (x) during
the last 17 days of the 180-day restricted period the Company issues an earnings
release or material news or a material event relating to the Company occurs,
or
(y) prior to the expiration of the 180-day restricted period, the Company
announces that it will release earnings results during the 16-day period
beginning on the last day of the 180-day period, the restrictions imposed in
this clause shall continue to apply until the expiration of the 18-day period
beginning on the issuance of the earnings release or the occurrence of the
material news or material event. The Company will provide the Representatives
and any co-managers and each individual subject to the restricted period
pursuant to the lockup letters described in Section 6(m) with prior notice
of
any such announcement that gives rise to an extension of the restricted
period.
(g) Compliance
with Laws.
The
Company will comply with all applicable securities and other applicable laws,
rules and regulations, including, without limitation, the Sarbanes Oxley Act,
and to use its best efforts to cause the Company’s directors and officers, in
their capacities as such, to comply with such laws, rules and
regulations.
(h) Price
Manipulation.
The
Company will not take, directly or indirectly, any action designed to or that
would constitute or that might reasonably be expected to cause or result in,
under the Exchange Act or otherwise, stabilization or manipulation of the price
of any security of the Company to facilitate the sale or resale of the Series
B
Shares or the ADSs.
(i) Expenses.
The
Company agrees to pay the costs and expenses relating to the following matters:
(i) the preparation, printing or reproduction and filing with the
Commission of the Registration Statement (including financial statements and
exhibits thereto), each International Preliminary Prospectus, the International
Prospectus and any Issuer Free Writing Prospectus, and each amendment or
supplement to any of them; (ii) the deposit of the Shares under the Deposit
Agreement, the issuance thereunder of ADSs representing such deposited Shares,
the issuance of ADRs evidencing such ADSs and the fees of the Depositary; (iii)
the printing (or reproduction) and delivery (including postage, air freight
charges and charges for counting and packaging) of such copies of the
Registration Statement, the ADR Registration Statement, each International
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20 -
Preliminary
Prospectus, the International Prospectus and each Issuer Free Writing
Prospectus, and all amendments or supplements to any of them, as may, in each
case, be reasonably requested for use in connection with the offering and sale
of the Shares; (iv) the preparation, printing, authentication, issuance and
delivery of certificates for the Global Shares, including any stamp or transfer
taxes in connection with the original issuance and sale of the Global Shares;
(v) the registration of the Global Shares under the Exchange Act and the listing
of the ADSs on the American Stock Exchange and the listing of the Series B
Shares on the Mexican Stock Exchange; (vi) any registration or
qualification of the Global Shares for offer and sale under the securities
or
blue sky laws of the several states (including filing fees and the reasonable
fees and expenses of counsel for the Underwriters relating to such registration
and qualification); (vii) any filings required to be made with the National
Association of Securities Dealers, Inc. (including filing fees and the
reasonable expenses of counsel for the Underwriters relating to such filings);
(viii) the transportation and other expenses incurred by or on behalf of Company
representatives in connection with presentations to prospective purchasers
of
the Global Shares; (ix) the fees and expenses of the Company’s accountants
and the fees and expenses of counsel (including local and special counsel)
for
the Company; and (x) all other costs and expenses incident to the
performance by the Company of their obligations under the Global Underwriting
Agreements. [In addition, the Company has agreed to pay or reimburse the
Underwriters (to the extent incurred by them) for all ordinary expenses of
the
Underwriters, incurred in connection with the roadshow and printing of roadshow
materials and all other ordinary out-of-pocket expenses of the Underwriters,
excluding the fees and disbursements of their international and local legal
counsel.]
(j) Use
of Proceeds.
The
Company will use the net proceeds received by it from the sale of the Global
Shares in the manner specified in the International Preliminary Prospectus
and
the International Prospectus under the heading “Use of Proceeds.”
(k) Representative
Consent to Free Writing Prospectus.
The
Company agrees that, unless it has obtained or will obtain the prior written
consent of the Representative, and each Underwriter, severally and not jointly,
agrees with the Company that, unless it has obtained or will obtain, as the
case
may be, the prior written consent of the Company, it has not made and will
not
make any offer relating to the Global Shares that would constitute an Issuer
Free Writing Prospectus or that would otherwise constitute a “free writing
prospectus” (as defined in Rule 405) required to be filed by the Company with
the Commission or retained by the Company under Rule 433, provided
that the
prior written consent of the parties hereto shall be deemed to have been given
in respect of the Free Writing Prospectuses included in Schedule
III
hereto
and any electronic road show. Any such free writing prospectus consented to
by
the Representative or the Company is hereinafter referred to as a “Permitted
Free Writing Prospectus.”
The
Company agrees that (x) it has treated and will treat, as the case may be,
each
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21 -
Permitted
Free Writing Prospectus as an Issuer Free Writing Prospectus and (y) it has
complied and will comply, as the case may be, with the requirements of Rules
164
and 433 applicable to any Permitted Free Writing Prospectus, including in
respect of timely filing with the Commission, legending and record
keeping.
6. Conditions
to the Obligations of the Underwriters.
The
obligations of the Underwriters to purchase the Underwritten Shares and the
Option Shares, as the case may be, shall be subject to the accuracy of the
representations and warranties on the part of the Company contained in this
Underwriting Agreement as of the Execution Time, the Closing Date and any
settlement date pursuant to Section 3 hereof, to the accuracy of the
statements of the Company made in any certificates pursuant to the provisions
hereof, to the performance by the Company of its obligations under this
Underwriting Agreement and to the following additional conditions:
(a) If
the
Registration Statement has not become effective prior to the Execution Time,
unless the Representative agrees in writing to a later time, the Registration
Statement will become effective not later than (i) 6:00 PM
New York City time on the date of determination of the public offering
price, if such determination occurred at or prior to 3:00 PM New York
City time on such date or (ii) 9:30 AM on the Business Day following
the day on which the public offering price was determined, if such determination
occurred after 3:00 PM New York City time on such date; if filing of
either of the Disclosure Package or the International Prospectus, or any
supplement thereto, is required pursuant to Rule 424(b), the Disclosure
Package and the International Prospectus, and any such supplement, will be
filed
in the manner and within the time period required by Rule 424(b); the ADR
Registration shall be effective and no stop order suspending the effectiveness
of the Registration Statement or the ADR Registration Statement shall have
been
issued and no proceedings for that purpose shall have been instituted or
threatened.
(b) The
Company shall have requested and caused Xxxxxxx Xxxxxxxx & Xxxx LLP, United
States counsel for the Company, to have furnished to the Representative their
opinion, dated the Closing Date and addressed to the Representative, in the
form
of Exhibit B hereto.
(c) The
Company shall have requested and caused Xxxxxxx, Angoitia, Xxxxxx x Xxxxxxx,
S.C., Mexican counsel for the Company, to have furnished to the Representative
their opinion, dated the Closing Date and addressed to the Representative,
in
the form of Exhibit C hereto.
(d) The
Depositary shall have requested and caused Xxxxx, Xxxxxx & Xxxxxx, LLP,
counsel for the Depositary, to have furnished to the Representative their
opinion dated the Closing Date and addressed to the Representative, in the
form
of Exhibit D hereto.
(e) The
Representatives shall have received from Milbank, Tweed, Xxxxxx & XxXxxx LLP
and Xxxxx, Xxxxxx Xxxxxxx y Xxxxxxxxxx, S.C. counsel for the
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22 -
Representative,
such opinions, dated the Closing Date and addressed to the Representative,
with
respect to the issuance and sale of the Shares, the Registration Statement,
the
ADR Registration Statement, the Disclosure Package and the International
Prospectus (together with any supplement thereto) and other related matters
as
the Representative may reasonably require, and the Company shall have furnished
to such counsel such documents as they request for the purpose of enabling
them
to pass upon such matters.
(f) The
Company shall have furnished to the Representative a certificate of the Company,
signed by the Chairman of the Board or the principal executive officer and
the
principal financial or accounting officer of the Company, dated the Closing
Date, to the effect that the signers of such certificate have carefully examined
the Registration Statement, the Disclosure Package and the International
Prospectus, any supplements to the Disclosure Package and the International
Prospectus and this Underwriting Agreement and the Mexican Underwriting
Agreement and that:
(i) the
representations and warranties of the Company in this Underwriting Agreement
and
the Mexican Underwriting Agreement are true and correct on and as of the Closing
Date with the same effect as if made on the Closing Date and the Company has
complied with all the agreements and satisfied all the conditions on its part
to
be performed or satisfied at or prior to the Closing Date;
(ii) to
the
Company’s knowledge, no stop order suspending the effectiveness of the
Registration Statement or the ADR Registration Statement has been issued and
no
proceedings for that purpose have been instituted or, threatened;
and
(iii) since
the
date of the most recent financial statements included in the Disclosure Package
and the International Prospectus (exclusive of any supplement thereto), there
has been no Material Adverse Effect, except as set forth in or contemplated
in
the Disclosure Package and the International Prospectus (exclusive of any
supplement thereto).
(g)
The
Company shall have requested and caused the following audit firms to have
furnished to the Representative letters, dated respectively as of the Execution
Time and as of the Closing Date, in the forms attached as Exhibits E-1 through
E-5 and otherwise covering such matters as the Representative requests.
(i)
Xxxxxxx/Ernst & Young,
(ii)
KPMG
Xxxxxxxx Xxxxx, S.C.,
(iii)
BDO
Xxxxxxx LLP,
(iv)
BDO
Xxxxxxxxx Xxxxxx y Cía., S.A., and
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23 -
(v)
KPMG
LLP.
(h) Subsequent
to the Execution Time or, if earlier, the dates as of which information is
given
in the Registration Statement (exclusive of any amendment thereof), the
Disclosure Package and the International Prospectus (exclusive of any supplement
thereto), there shall not have been (i) any change or decrease specified in
the letter or letters referred to in paragraph (e) of this Section 6
or (ii) any change, or any development involving a prospective change, in
or affecting the condition (financial or otherwise), earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether or
not
arising from transactions in the ordinary course of business, except as set
forth in or contemplated in the Disclosure Package and the International
Prospectus (exclusive of any supplement thereto) the effect of which, in any
case referred to in clause (i) or (ii) above, is, in the sole judgment of
the Representative, so material and adverse as to make it impractical or
inadvisable to proceed with the offering or delivery of the Global Shares as
contemplated by the Registration Statement (exclusive of any amendment thereof),
the ADR Registration Statement, the Disclosure Package and the International
Prospectus (exclusive of any supplement thereto).
(i) The
Deposit Agreement shall be in full force and effect.
(j) The
Depositary shall have furnished or caused to be furnished to the Representative
certificates satisfactory to the Representative evidencing the deposit with
the
Custodian of the Underlying Shares in respect of which ADSs to be purchased
by
the Underwriters on such Closing Date are to be issued, and the execution,
issuance, countersignature (if applicable) and delivery of the ADRs evidencing
such ADSs pursuant to the Deposit Agreement and such other matters related
thereto as the Representative reasonably requests.
(k) Prior
to
the Closing Date, the Company shall have furnished to the Representative such
further information, certificates and documents as the Representative may
reasonably request.
(l) The
ADRs
shall have been listed and admitted and authorized for trading on the American
Stock Exchange, and satisfactory evidence of such actions shall have been
provided to the Representative. The Series B Shares shall have been listed
and
admitted and authorized for trading on the Mexican Stock Exchange, and
satisfactory evidence of such actions shall have been provided to the
Representative.
(m) Prior
to
the Execution Time, the Company shall have furnished to the Representative
a
letter substantially in the form of Exhibit
A
hereto
from each of the shareholders identified in the tables entitled “Major
Shareholders” in the International Prospectus and each officer and director of
the Company addressed to the Representative.
(n) The
delivery of the Mexican Shares pursuant to the Mexican Underwriting Agreement
shall have occurred.
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24 -
(o) The
Company shall have, pursuant to Section 17 of the Underwriting Agreement,
validly and irrevocably appointed CT Corporation System as its agent for the
purposes described in such Section 17; and personal service of process effected
on such agent in any manner permitted by applicable law will be effective to
confer valid personal jurisdiction over the Company in any such action. For
such
purposes, the Underwriters shall have received an original instrument
(escritura
pública)
issued
by a notary public in Mexico, evidencing an irrevocable power of attorney
granted by the Company in favor of CT Corporation System for the purposes
referred to in Section 17 hereof, together with a letter from CT Corporation
System accepting the appointment conferred on it by the Company.
(p) All
approvals required under the laws of Mexico at the Closing Time shall have
been
obtained including, where applicable, the registration of the Global Shares
with
the Mexican National Registry of Securities, the approval of the public offering
by the Mexican National Banking and Securities Commission, the listing and
admittance and authorization for trading of the Global Shares by the Mexican
Stock Exchange and the approval of certain special conditions in connection
with
the public offering in Mexico of the Mexican Shares from the Mexican Stock
Exchange.
(q) Any
Shares to be delivered in the form of Series B Shares shall have been deposited
and credited prior to or at the time of closing to the account designated by
the
Representative with Indeval;
(r) Such
other matters related thereto as the Representative may reasonably request
shall
have been addressed to the Representative’s satisfaction.
If
any of
the conditions specified in this Section 6 shall not have been fulfilled
when and as provided in this Underwriting Agreement, or if any of the opinions
and certificates mentioned above or elsewhere in this Underwriting Agreement
shall not be reasonably satisfactory in form and substance to the Representative
and counsel for the Representative, this Underwriting Agreement and all
obligations of the Underwriters under this Underwriting Agreement may be
canceled at, or at any time prior to, the Closing Date by the Representative.
Notice of such cancellation shall be given to the Company in writing or by
telephone or facsimile confirmed in writing.
The
documents required to be delivered by this Section 6 shall be delivered at
the
office of Milbank, Tweed, Xxxxxx & XxXxxx LLP, United States counsel for the
Representative, at Xxx Xxxxx Xxxxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000,
on
the
Closing Date.
7.
Reimbursement
of Underwriters’ Expenses.
If the
sale of the Shares provided for in this Underwriting Agreement is not
consummated because any condition to the obligations of the Underwriters set
forth in Section 6 hereof is not satisfied, because of any termination
pursuant to Section 10 hereof or because of any refusal, inability or failure
on
the part of the Company to perform any agreement in this Underwriting Agreement
or comply with any provision hereof other than by reason of a
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25 -
default
by any of the Underwriters, the Company will reimburse the Underwriters
severally through Citigroup Global Markets Inc. on demand for all customary
out-of-pocket expenses (including reasonable fees and disbursements of counsel)
actually incurred by them in connection with the proposed purchase and sale
of
the Shares.
8.
Indemnification
and Contribution.
(a)
The
Company agrees to indemnify and hold harmless each Underwriter, the directors,
officers, employees and agents of each Underwriter and each person who controls
any Underwriter within the meaning of either the Act or the Exchange Act,
against any and all losses, claims, damages or liabilities, joint or several,
to
which they or any of them may become subject under the Act, the Exchange Act
or
other Federal or state statutory law or regulation, at common law or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement as
originally filed or in any amendment thereof, or in the Disclosure Package,
or
in any amendment thereof, or in the ADR Registration Statement as originally
filed or in any amendment thereof, or in any International Preliminary
Prospectus, the International Prospectus, the Mexican Preliminary Prospectus,
the Mexican Prospectus or any Issuer Free Writing Prospectus, or in any
amendment thereof 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
agrees to reimburse each such indemnified party, as incurred, for any legal
or
other expenses reasonably incurred by them in connection with investigating
or
defending any such loss, claim, damage, liability or action; provided,
however,
that
the Company will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished
to
the Company by or on behalf of any Underwriter through the Representative
specifically for inclusion therein. This indemnity agreement will be in addition
to any liability which the Company may otherwise have.
(b) Each
of
the Underwriters severally and not jointly agree to indemnify and hold harmless
the Company, each of its directors, each of its officers who signs the
Registration Statement, or the ADR Registration Statement, and each person
who
controls the Company within the meaning of either the Act or the Exchange Act,
to the same extent as the foregoing indemnity to each Underwriter, but only
with
reference to written information relating to such Underwriter furnished to
the
Company by or on behalf of such Underwriter through the Representative
specifically for inclusion in the documents referred to in the foregoing
indemnity. This indemnity agreement will be in addition to any liability which
any Underwriter may otherwise have. The Company acknowledges that the statements
set forth in the last paragraph of the cover page regarding delivery of the
Shares and, under the heading “Underwriting”, (i) the list of Underwriters
and their respective participation in the sale of the Shares, (ii) the
sentences related to concessions and reallowances and (iii) the paragraph
related to stabilization, syndicate covering transactions and penalty bids
in
any International Preliminary Prospectus, the International Prospectus and
any
Issuer Free Writing Prospectus
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26 -
constitute
the only information furnished in writing by or on behalf of the several
Underwriters for inclusion in any International Preliminary Prospectus, the
International Prospectus and any Issuer Free Writing Prospectus.
(c) Promptly
after receipt by an indemnified party under this Section 8 of notice of the
commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against the indemnifying party under this Section 8,
notify the indemnifying party in writing of the commencement thereof; but the
failure so to notify the indemnifying party (i) will not relieve it from
liability under paragraph (a) or (b) above unless and to the extent it did
not
otherwise learn of such action and such failure results in the forfeiture by
the
indemnifying party of substantial rights and defenses and (ii) will not, in
any
event, relieve the indemnifying party from any obligations to any indemnified
party other than the indemnification obligation provided in paragraph (a)
or (b) above. The indemnifying party shall be entitled to appoint counsel of
the
indemnifying party’s choice at the indemnifying party’s expense to represent the
indemnified party in any action for which indemnification is sought (in which
case the indemnifying party shall not thereafter be responsible for the fees
and
expenses of any separate counsel retained by the indemnified party or parties
except as set forth below); provided,
however,
that
such counsel shall be satisfactory to the indemnified party. Notwithstanding
the
indemnifying party’s election to appoint counsel to represent the indemnified
party in an action, the indemnified party shall have the right to employ
separate counsel (including local counsel), and the indemnifying party shall
bear the reasonable fees, costs and expenses of such separate counsel if
(i) the use of counsel chosen by the indemnifying party to represent the
indemnified party would present such counsel with a conflict of interest,
(ii) the actual or potential defendants in, or targets of, any such action
include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, (iii) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of the institution of such action or (iv) the indemnifying
party shall authorize the indemnified party to employ separate counsel at the
expense of the indemnifying party. An indemnifying party will not, without
the
prior written consent of the indemnified parties, settle or compromise or
consent to the entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought under this Underwriting Agreement (whether or not
the
indemnified parties are actual or potential parties to such claim or action)
unless such settlement, compromise or consent includes an unconditional release
of each indemnified party from all liability arising out of such claim, action,
suit or proceeding.
(d) In
the
event that the indemnity provided in paragraph (a) or (b) of this Section 8
is
unavailable to or insufficient to hold harmless an indemnified party for any
reason, the Company and the Underwriters severally agree to contribute to the
aggregate losses, claims, damages and liabilities (including legal or other
expenses reasonably incurred in connection with investigating or defending
same)
(collectively “Losses”)
to
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27 -
which
the
Company and one or more of the Underwriters may be subject in such proportion
as
is appropriate to reflect the relative benefits received by the Company on
the
one hand and by the Underwriters on the other from the offering of the Shares;
provided,
however,
that in
no case shall any Underwriter (except as may be provided in any agreement among
underwriters relating to the offering of the Shares) be responsible for any
amount in excess of the underwriting discount or commission applicable to the
Shares purchased by such Underwriter under this Underwriting Agreement. If
the
allocation provided by the immediately preceding sentence is unavailable for
any
reason, the Company and the Underwriters severally shall contribute 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 of the Underwriters on
the
other in connection with the statements or omissions which resulted in such
Losses as well as any other relevant equitable considerations. Benefits received
by the Company shall be deemed to be equal to the total net proceeds from the
offering (before deducting expenses) received by them, benefits received by
the
Underwriters shall be deemed to be equal to the total underwriting discounts
and
commissions, in each case as set forth on the cover page of the International
Prospectus. Relative fault shall be determined by reference to, among other
things, whether any untrue or any alleged untrue statement of a material fact
or
the omission or alleged omission to state a material fact relates to information
provided by the Company on the one hand or the Underwriters on the other, the
intent of the parties and their relative knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission. The Company
and the Underwriters agree that it would not be just and equitable if
contribution were determined by pro rata allocation or any other method of
allocation which does not take account of the equitable considerations referred
to above. Notwithstanding the provisions of this paragraph (d), no person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. For purposes of this Section 8, each
person who controls an Underwriter within the meaning of either the Act or
the
Exchange Act and each director, officer, employee and agent of an Underwriter
shall have the same rights to contribution as such Underwriter, and each person
who controls the Company within the meaning of either the Act or the Exchange
Act, each officer of the Company who shall have signed the Registration
Statement and the ADR Registration Statement and each director of the Company
shall have the same rights to contribution as the Company, subject in each
case
to the applicable terms and conditions of this paragraph (d).
9. Default
by an Underwriter.
If any
one or more Underwriters shall fail to purchase and pay for any of the Shares
agreed to be purchased by such Underwriter or Underwriters under this
Underwriting Agreement and such failure to purchase shall constitute a default
in the performance of its or their obligations under this Underwriting
Agreement, the remaining Underwriters shall be obligated severally to take
up
and pay for (in the respective proportions which the amount of Shares set forth
opposite their names in Schedule I
hereto
bears to the aggregate amount of Shares set forth opposite the names of all
the
remaining Underwriters) the Shares which the defaulting Underwriter or
Underwriters agreed but failed to purchase; provided,
however,
that in
the
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28 -
event
that the aggregate amount of Shares which the defaulting Underwriter or
Underwriters agreed but failed to purchase shall exceed 10% of the aggregate
amount of Shares set forth in Schedule I
hereto,
the remaining Underwriters shall have the right to purchase all, but shall
not
be under any obligation to purchase any, of the Shares, and if such
nondefaulting Underwriters do not purchase all the Shares, this Underwriting
Agreement will terminate without liability to any nondefaulting Underwriter
or
the Company. In the event of a default by any Underwriter as set forth in this
Section 9, the Closing Date shall be postponed for such period, not
exceeding five Business Days, as the Representative shall determine in order
that the required changes in the Registration Statement, the ADR Registration
Statement, the Disclosure Package and the Prospectus or in any other documents
or arrangements may be effected. Nothing contained in this Underwriting
Agreement shall relieve any defaulting Underwriter of its liability, if any,
to
the Company and any nondefaulting Underwriter for damages occasioned by its
default under this Underwriting Agreement.
10. Termination. This
Underwriting Agreement shall be subject to termination in the absolute
discretion of the Representative, by notice given to the Company prior to
delivery of and payment for the Shares, if at any time prior to such time
(i) trading in the Company’s ADSs or Series B Shares shall have been
suspended by the Commission or the American Stock Exchange or the Mexican Stock
Exchange or trading in securities generally on the American Stock Exchange
or
the Mexican Stock Exchange shall have been suspended or limited or minimum
prices shall have been established on such exchange, (ii) a banking
moratorium shall have been declared by U.S. Federal, New York State or
Mexican authorities or (iii) there shall have occurred any outbreak or
escalation of hostilities, declaration by the United States or Mexico of a
national emergency or war, or other calamity or crisis the effect of which
on
financial markets is such as to make it, in the sole judgment of the
Representative, impractical or inadvisable to proceed with the offering or
delivery of the Global Shares as contemplated by the International Preliminary
Prospectus or the International Prospectus (exclusive of any supplement
thereto).
11. Representations
and Indemnities to Survive.
The
respective agreements, representations, warranties, indemnities and other
statements of the Company or its officers and of the Underwriters set forth
in
or made pursuant to this Underwriting Agreement will remain in full force and
effect, regardless of any investigation made by or on behalf of any Underwriter
or the Company or any of the officers, directors or controlling persons referred
to in Section 8 hereof, and will survive delivery of and payment for the
Shares. The provisions of Sections 7 and 8 hereof shall survive the
termination or cancellation of this Underwriting Agreement.
12. Notices.
All
communications under this Underwriting Agreement will be in writing and
effective only on receipt, and, if sent to the Representative, will be mailed,
delivered or telefaxed to the Citigroup Global Markets Inc. General Counsel
(fax
no.: (000) 000-0000) and confirmed to such General Counsel at Citigroup
Global Markets Inc., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Attention:
General Counsel; or, if sent to the Company, will be mailed, delivered or
telefaxed to (fax no.: (5233)
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29 -
1057-5710)
and confirmed to it at Xxxxxxx Xxxxxx Xxxxxxxx 601, Colonia La Nogalera,
Xxxxxxxxxxx, Xxxxxxx, Xxxxxx 00000, attention of the Legal Department with
a
copy to Xxxxxxx Xxxxxxxx & Wood LLP, Two World Financial Center, Xxx Xxxx,
XX 00000, attention: Xxxx X. Xxxxxxx, Esq.
13. Successors.
This Underwriting Agreement will inure to the benefit of and be binding upon
the
parties hereto and their respective successors and the officers and directors
and controlling persons referred to in Section 8 hereof, and no other
person will have any right or obligation under this Underwriting
Agreement.
14. No
Fiduciary duty.
The
Company hereby acknowledges that (a) the purchase and sale of the Shares
pursuant to this Underwriting Agreement is an arm’s-length commercial
transaction between the Company, on the one hand, and the Underwriters and
any
affiliate through which it may be acting, on the other, (b) the Underwriters
are
acting as principal and not as an agent or fiduciary of the Company and (c)
the
Company’s engagement of the Underwriters in connection with the offering and the
process leading up to the offering is as independent contractors and not in
any
other capacity. Furthermore, the Company agrees that it is solely responsible
for making its own judgments in connection with the offering (irrespective
of
whether any of the Underwriters has advised or is currently advising the Company
on related or other matters). The Company agrees that it will not claim that
the
Underwriters have rendered advisory services of any nature or respect, or owe
agency, fiduciary or similar duty to the Company in connection with such
transaction or the process leading thereto.
15. Integration.
This
Underwriting Agreement supersedes all prior agreements and understandings
(whether written or oral) between the Company and the Underwriters, or any
of
them, with respect to the subject matter hereof.
16. Applicable
Law.
This
Underwriting Agreement will be governed by and construed in accordance with
the
laws of the State of New York applicable to contracts made and to be performed
within the State of New York.
17. Jurisdiction.
The
parties hereto agree that any suit, action or proceeding against any other
party
hereto, the directors, officers, employees and agents of any such party, or
by
any person who controls any such party, arising out of or based upon this
Underwriting Agreement or the transactions contemplated hereby may be instituted
in any New York Court or in the courts of Mexico, and expressly waives any
objection which it may now or hereafter have to the laying of venue of any
such
proceeding and irrevocably submits to the exclusive jurisdiction of such courts
in any suit, action or proceeding and any right to which it may be entitled
on
account of place of residence or domicile. The Company has irrevocably appointed
CT Corporation System as its authorized agent (the “Authorized
Agent”)
upon
whom process may be served in any suit, action or proceeding arising out of
or
based upon this Underwriting Agreement or the transactions contemplated herein
which may be instituted in any New York Court, by any Underwriter, the
directors, officers, employees and agents of any Underwriter, or by any person
who controls any Underwriter, and expressly accepts jurisdiction of any such
court
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30 -
in
respect of any such suit, action or proceeding. The Company hereby represents
and warrants that the Authorized Agent has accepted such appointment and has
agreed to act as said agent for service of process, and the Company agrees
to
take any and all action, including the filing of any and all documents that
may
be necessary to continue such appointment in full force and effect as aforesaid.
Service of process upon the Authorized Agent shall be deemed, in every respect,
effective service of process upon the Company.
The
provisions of this Section 17 shall survive any termination of this
Underwriting Agreement, in whole or in part.
18. Currency.
Each
reference in this Underwriting Agreement to Dollars (the “relevant
currency”)
is of
the essence. To the fullest extent permitted by law, the obligations of the
Company in respect of any amount due under this Underwriting Agreement will,
notwithstanding any payment in any other currency (whether pursuant to a
judgment or otherwise), be discharged only to the extent of the amount in the
relevant currency that the party entitled to receive such payment may, in
accordance with its normal procedures, purchase with the sum paid in such other
currency (after any premium and costs of exchange) on the Business Day
immediately following the day on which such party receives such payment. If
the
amount in the relevant currency that may be so purchased for any reason falls
short of the amount originally due, the Company making such payment will pay
such additional amounts, in the relevant currency, as may be necessary to
compensate for the shortfall. Any obligation of any of the Company discharged
by
such payment will, to the fullest extent permitted by applicable law, be due
as
a separate and independent obligation and, until discharged as provided herein,
will continue in full force and effect.
19. Waiver
of Immunity.
To the
extent that the Company has or hereafter may acquire any immunity (sovereign
or
otherwise) from any legal action, suit or proceeding, from jurisdiction of
any
court or from set-off or any legal process (whether service or notice,
attachment in aid or otherwise) with respect to itself or any of its property,
the Company hereby irrevocably waives and agrees not to plead or claim such
immunity in respect of its obligations under this Underwriting
Agreement.
20. Taxes.
The
Company agrees to make all payments in respect of this Underwriting Agreement
free and clear of and without deduction or withholding for or on account of
any
present or future taxes, duties, assessments, fees or other governmental charges
imposed or levied by or on behalf of Mexico or any political subdivision or
taxing authority thereof or therein (all such duties, assessments, fees or
other
governmental charges being referred to as “Mexican
Taxes”),
unless such withholding or deduction is required by law. In that event, the
Company will pay to the Representative, on behalf of the Underwriters, such
additional amounts as may be necessary in order that every net payment made
by
the Company in respect of this Underwriting Agreement after deduction or
withholding for or on account of any such present or future Mexican Taxes will
not be less than the amount then due and payable in respect of this Underwriting
Agreement.
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31 -
21. Waiver
of Jury Trial.
Each of
the parties hereby irrevocably waives, to the fullest extent permitted by
applicable law, any and all right to trial by jury in any legal proceeding
arising out of or relating to this Agreement or the transactions contemplated
hereby.
22. Counterparts.
This
Underwriting Agreement may be signed in one or more counterparts, each of which
shall constitute an original and all of which together shall constitute one
and
the same agreement.
23. Headings.
The
section headings used in this Underwriting Agreement are for convenience only
and shall not affect the construction hereof.
24. Definitions.
The
terms which follow, when used in this Underwriting Agreement, shall have the
meanings indicated.
“Act”
shall
mean the United States Securities Act of 1933, as amended, and the rules and
regulations of the Commission promulgated thereunder.
“ADR
Registration Statement”
shall
mean the registration statement referred to in paragraph 1(i)(c) above,
including all exhibits thereto, each as amended at the time such part of the
registration statement became effective.
“Business
Day”
shall
mean any day other than a Saturday, a Sunday or a legal holiday or a day on
which banking institutions or trust companies are authorized or obligated by law
to close in New York City or Mexico City, Mexico.
“Commission”
shall
mean the Securities and Exchange Commission.
“Disclosure
Package”
shall
mean (i) the Statutory Prospectus, (ii) the Issuer Free Writing Prospectuses,
if
any, identified in Schedule
II
hereto,
and (iii) any other Free Writing Prospectus that the parties hereto shall
hereafter expressly agree in writing to treat as part of the Disclosure
Package.
“Effective
Date”
shall
mean each date and time that the Registration Statement and the ADR Registration
Statement, any post-effective amendment or amendments thereto and any
Rule 462(b) Registration Statement became or become effective.
“Exchange
Act”
shall
mean the United States Securities Exchange Act of 1934, as amended, and the
rules and regulations of the Commission promulgated thereunder.
“Execution
Time”
shall
mean the date and time that this Underwriting Agreement is executed and
delivered by the parties hereto.
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32 -
“Free
Writing Prospectus”
shall
mean a free writing prospectus, as defined in Rule 405.
“Indeval”
shall
mean S.D. Indeval, S.A. de C.V., Instituto para el Depósito de
Valores.
“International
Preliminary Prospectus”
shall
mean any preliminary prospectus which describes the Shares and the offering
thereof, but which omits Rule 430A Information, and is used prior to filing
of
the International Prospectus.
“International
Prospectus”
shall
mean the prospectus relating to the Shares that is first filed pursuant to
Rule
424(b) after the Execution Time or, if no filing pursuant to Rule 424(b) is
required, shall mean the form of final prospectus relating to the Shares
included in the Registration Statement at the Effective Date.
“Issuer
Free Writing Prospectus”
shall
mean an issuer free writing prospectus, as defined in Rule 433.
“Mexican
Preliminary Prospectus”
shall
mean the preliminary prospectus approved for the offering by the Mexican
National Banking and Securities Commission.
“Mexican
Prospectus”
shall
mean the final prospectus approved for the offering by the Mexican National
Banking and Securities Commission.
“New
York Courts”
shall
mean the U.S. federal or State courts located in the State of New York,
County of New York.
“Registration
Statement”
shall
mean the registration statement referred to in paragraph 1(i)(a) above,
including exhibits and financial statements, as amended at the Execution Time
(or, if not effective at the Execution Time, in the form in which it shall
become effective) and, in the event any post-effective amendment thereto or
any
Rule 462(b) Registration Statement becomes effective prior to the Closing
Date, shall also mean such registration statement as so amended or such
Rule 462(b) Registration Statement, as the case may be. Such term shall
include any Rule 430A Information deemed to be included therein at the
Effective Date as provided by Rule 430A.
“Representative”
shall
mean the addressee of this Underwriting Agreement.
“Rule
158”,
“Rule
405”,
Rule 424”,
“Rule 430A”
and
“Rule 462”
refer
to such rules under the Act.
“Rule 430A
Information”
shall
mean information with respect to the Shares and the offering thereof permitted
to be omitted from the Registration Statement when it becomes effective pursuant
to Rule 430A.
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33 -
“Rule 462(b)
Registration Statement”
shall
mean a registration statement and any amendments thereto filed pursuant to
Rule 462(b) relating to the offering covered by the registration statement
referred to in Section 1(a)(i) hereof.
“Statutory
Prospectus”
shall
mean the preliminary prospectus relating to the Shares that is included in
the
Registration Statement immediately prior to the Execution Time, including any
document that is incorporated by reference therein.
“Underlying
Shares”
shall
mean the Series B Shares that will be represented by the ADSs.
“United
States or Canadian Person”
shall
mean any person who is a national or resident of the United States or Canada,
any corporation, partnership, or other entity created or organized in or under
the laws of the United States or Canada or of any political subdivision thereof,
or any estate or trust the income of which is subject to United States or
Canadian Federal income taxation, regardless of its source (other than any
non-United States or non-Canadian branch of any United States or Canadian
Person), and shall include any United States or Canadian branch of a person
other than a United States or Canadian Person. “U.S.” or “United States” shall
mean the United States of America (including the states thereof and the District
of Columbia), its territories, its possessions and other areas subject to its
jurisdiction.
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34 -
If
the
foregoing is in accordance with your understanding of our agreement, please
sign
and return to us the enclosed duplicate hereof, whereupon this letter and your
acceptance shall represent a binding agreement among the Company and the several
Underwriters.
|
Very
truly yours,
|
||
|
GRUPO
SIMEC, S.A.B. de
C.V.
|
||
| |
|
|
| By: | ||
|
Name:
|
||
|
Title:
|
||
| |
|
|
| By: | ||
|
Name:
|
||
|
Title:
|
||
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35 -
The
foregoing Agreement is hereby
confirmed
and accepted as of the
date
first above written.
Citigroup
Global Markets Inc.
|
By:
Citigroup Global Markets Inc.
|
|||
|
By:
|
|||
|
Name:
|
|||
|
Title:
|
For
itself and the other
several
Underwriters
named
in
Schedule
I
to the
foregoing
Agreement.
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36 -
