EXHIBIT 1.1
EL PASO NATURAL GAS COMPANY
(A DELAWARE CORPORATION)
(TITLE OF DEBT SECURITIES)
TERMS AGREEMENT
Dated: [ ] , 199[ ]
El Paso Natural Gas Company
One Xxxx Xxxxxx Center
000 Xxxxx Xxxxxxx Xxxxxx
Xx Xxxx, Xxxxx 00000
Dear Sirs:
We (the "Representative(s)") are acting on behalf of the underwriter or
underwriters (including ourselves) named below (such underwriter or
underwriters being herein called the "Underwriters"), and we understand that
El Paso Natural Gas Company, a Delaware corporation (the "Company"), proposes
to issue and sell $[ ] aggregate principal amount of its (Title of Debt
Securities) (the "Debt Securities"). The Debt Securities will be issued
pursuant to the provisions of an Indenture dated as of [ ], 1996 (the
"Indenture"), between the Company and The Chase Manhattan Bank, as Trustee
(the "Trustee").
Subject to the terms and conditions set forth or incorporated by reference
herein, the Company hereby agrees to sell and the Underwriters agree to
purchase, severally and not jointly, the respective principal amounts of Debt
Securities set forth below opposite their names at the (respective) purchase
price(s) set forth below.
UNDERWRITER PRINCIPAL AMOUNT OF DEBT SECURITIES
----------- -----------------------------------
$
------------
Total............................. $
============
The Debt Securities shall have the terms set forth in the Prospectus dated
[ ], 199[ ], and the Prospectus Supplement dated [ ],
199[ ], including the following:
Title:
[Currency: ]
Principal Amount to be Issued:
Maturity Date:
Interest Rate or Formula:
Interest Payment Dates: Each [ ] and [ ], commencing
[ ], [ ]
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Redemption Provisions:
Sinking Fund Requirements:
[Initial Public Offering Price: [ ]%, plus accrued interest, if any, or
amortized original issue discount, if any, from [ ], 19[ ].]
Purchase Price: [ ]%, plus accrued interest, if any, or amortized original
issue discount, if any, from [ ], 19[ ] [payable in [immediately
available] funds].
Other Terms:
Closing Date and Location:
All provisions contained in the document attached as Annex A hereto entitled
"El Paso Natural Gas Company--Underwriting Agreement Standard Provisions (Debt
Securities)", are hereby incorporated by reference in their entirety and shall
be deemed to be a part of this Terms Agreement to the same extent as if such
provisions had been set forth in full herein. Terms defined in such document
are used herein as therein defined.
Please confirm your agreement by having an authorized officer sign a copy of
this Terms Agreement in the space set forth below.
Very truly yours,
(Name(s) of Representative(s))
Acting severally on behalf of
(itself) (themselves) and the
several Underwriters named herein
By: (Name of Lead-Representative)
By: _________________________________
Name:
Title:
Accepted as of the date first above written:
El Paso Natural Gas Company
By: _________________________________
Name:
Title:
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ANNEX A
EL PASO NATURAL GAS COMPANY
(A DELAWARE CORPORATION)
UNDERWRITING AGREEMENT
STANDARD PROVISIONS
(DEBT SECURITIES)
El Paso Natural Gas Company, a Delaware corporation (the "Company") proposes
to issue and sell up to [$ ] aggregate principal amount of its unsecured
debt securities (the "Debt Securities"), from time to time in one or more
offerings on terms determined at the time of sale. The Debt Securities will be
issued under an Indenture dated as of [ ], 1996, as amended, modified and
supplemented from time to time (the "Indenture"), between the Company and The
Chase Manhattan Bank, as trustee (the "Trustee"). Each issue of Debt
Securities may vary as to the aggregate principal amount, maturity date,
interest rate or formula and timing of payment thereof, redemption provisions,
conversion provisions and sinking fund requirements, if any, and any other
variable terms which the Indenture contemplates may be set forth in the Debt
Securities as issued from time to time.
This is to confirm the arrangements with respect to the purchase of Debt
Securities from the Company by the Representative(s) and the several
Underwriters listed in the applicable terms agreement entered into between the
Representative(s) and the Company of which this Underwriting Agreement is
Annex A thereto (the "Terms Agreement"). Terms defined in the Terms Agreement
are used herein as therein defined.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-14617) in respect
of the Debt Securities, shares of the Company's Common Stock, $3.00 par value
per share, and shares of the Company's Preferred Stock, $.01 par value per
share, which registration statement also constitutes a post-effective
amendment to registration statement No. 33-44327, relating to the Company's
debt securities and a post-effective amendment to registration statement No.
33-55153, and has filed such amendments thereto as may have been required to
the date of the Terms Agreement. Such registration statement and such post-
effective amendments, as amended, have been declared effective by the
Commission and the Indenture has been qualified under the Trust Indenture Act
of 1939, as amended (the "Trust Indenture Act"). Such registration statement
and such post-effective amendments, as amended, including all documents
incorporated therein by reference, as from time to time amended or
supplemented pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), the Securities Act of 1933, as amended (the "Securities
Act"), or otherwise, and any registration statement filed pursuant to Rule
462(b) under the Securities Act are herein collectively referred to as the
"Registration Statement". Such combined prospectus constituting a part of the
Registration Statement and any prospectus subject to completion taken together
with any term sheet meeting the requirements of Rule 434(b) under the
Securities Act, as applicable, are collectively referred to herein as the
"Prospectus"; provided, however, that a supplement to the Prospectus
contemplated by Section 3(a) hereof (a "Prospectus Supplement") shall be
deemed to have supplemented the Prospectus only with respect to the offering
of Debt Securities to which it relates.
1. Representations and Warranties. The Company represents and warrants to
each of the Underwriters named in the Terms Agreement that:
(a) The Registration Statement has become effective under the Securities
Act, no stop order suspending the effectiveness of the Registration
Statement is in effect, and no proceedings for such purpose are pending
before or, to the best of the Company's knowledge, contemplated by the
Commission.
(b) (i) Each document, if any, filed or to be filed pursuant to the
Exchange Act and incorporated by reference in the Prospectus complied or
will comply when so filed in all material respects with the Exchange
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Act and the applicable rules and regulations of the Commission thereunder;
(ii) each part of the Registration Statement, when such part became
effective, did not contain, and each such part, as amended or supplemented,
if applicable, will not contain, any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading; (iii) the Registration
Statement and the Prospectus comply, and, as amended or supplemented, if
applicable, will comply, in all material respects with the Securities Act
and the applicable rules and regulations of the Commission thereunder; and
(iv) the Prospectus does not contain and, as amended or supplemented, if
applicable, will not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading,
except that the representations and warranties set forth in this Section
1(b) do not apply (A) to statements or omissions in the Registration
Statement or the Prospectus based upon information relating to any
Underwriter furnished to the Company in writing by such Underwriter through
the Representative(s) expressly for use in the Registration Statement or
Prospectus, or (B) to that part of the Registration Statement that
constitutes the Statement of Eligibility (Form T-1) of the Trustee under
the Trust Indenture Act.
(c) The Company has been duly incorporated and is validly existing in
good standing under the laws of the State of Delaware, has the corporate
power and authority to own its properties and to conduct its business as
described in the Prospectus and is duly qualified as a foreign corporation
to transact business and is in good standing in each jurisdiction in which
the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse effect
on the assets, business, financial condition or results of operations of
the Company and its subsidiaries, taken as a whole (a "Material Adverse
Effect").
(d) Each significant subsidiary of the Company within the meaning of
Regulation S-K (each hereinafter referred to as a "Subsidiary") has been
duly incorporated and is a corporation duly organized, validly existing in
good standing under the laws of the jurisdiction of its incorporation, has
the corporate power and authority to own its properties and to conduct its
business as described in the Prospectus and is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not have a
Material Adverse Effect.
(e) This Agreement has been duly authorized, executed and delivered by
the Company.
(f) The Indenture has been duly authorized, executed and delivered by the
Company and duly qualified under the Trust Indenture Act and, when duly
executed and delivered by the Trustee, will be a valid and binding
agreement of the Company, enforceable in accordance with its terms, except
as the enforcement thereof may be limited by bankruptcy, insolvency
(including all laws relating to fraudulent conveyance), reorganization,
moratorium and other similar laws of general applicability relating to or
affecting creditors' rights generally and general principles of equity,
regardless of whether enforcement is considered in a proceeding in equity
or at law (collectively, the "Bankruptcy Exceptions").
(g) The Debt Securities being sold pursuant to a Terms Agreement have, as
of the date of such Terms Agreement, been duly authorized and, when
executed and authenticated in accordance with the provisions of the
Indenture and delivered to and paid for by the Underwriters in accordance
with the terms of such Terms Agreement, will be entitled to the benefits of
the Indenture and will be valid and binding obligations of the Company, in
each case enforceable in accordance with their respective terms, except as
the enforcement thereof may be limited by the Bankruptcy Exceptions; and
the Debt Securities being sold pursuant to a Terms Agreement conform in all
material respects to all descriptions thereof contained in the Prospectus.
(h) Neither the Company nor any Subsidiaries are (i) in violation of
their respective charters or by-laws, or (ii) in default in the performance
of any obligation, agreement or condition contained in any bond, debenture,
note or any other evidence of indebtedness or in any other agreement,
indenture or instrument to
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which the Company or any Subsidiaries is a party or by which the Company or
any Subsidiaries or their respective property is bound, except in the case
of clause (ii) for such violations or defaults as would not, individually
or in the aggregate, have a Material Adverse Effect.
(i) The execution and delivery by the Company of, and the performance by
the Company of its obligations under, this Agreement, the Indenture and the
Debt Securities will not violate (i) the Restated Certificate of
Incorporation, as amended, or By-laws of the Company, (ii) any provision of
applicable law, (iii) any agreement or other instrument binding upon the
Company or any Subsidiaries, or (iv) any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the Company or
any Subsidiary, except, in the case of clauses (ii) through (iv),
inclusive, for such violations as would not, individually or in the
aggregate, have a Material Adverse Effect. No consent, approval,
authorization or order of or qualification with any U.S. governmental body
or agency is required for the performance by the Company of its obligations
under this Agreement, the Indenture or the Debt Securities, except (x) such
as may be required by the securities or Blue Sky laws of the various states
in connection with the offer and sale of the Debt Securities, or (y) where
the failure to obtain such consent, approval, authorization, order or
qualification would not, individually or in the aggregate, have a Material
Adverse Effect or materially adversely affect the offering of the Debt
Securities as contemplated in the Prospectus Supplement.
(j) Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, except as may otherwise be
stated in or contemplated by the Registration Statement and Prospectus,
there has not occurred any material adverse change, or any development
involving a prospective material adverse change, in the assets, business,
financial condition or results of operations of the Company and its
subsidiaries, taken as a whole.
(k) Other than as set forth or incorporated by reference in the
Registration Statement and Prospectus, there are no legal or governmental
proceedings instituted or, to the best of the Company's knowledge,
threatened against the Company or any Subsidiaries which would restrict the
issuance and sale of the Debt Securities as contemplated by the Prospectus
or which are required under the Securities Act to be disclosed therein and
which are not disclosed. No contract or document of a character required
under the Securities Act to be described in the Registration Statement or
Prospectus or to be filed as an exhibit to the Registration Statement is
not so described or filed as required.
(l) The financial statements, together with related schedules and notes
forming part of the Registration Statement and the Prospectus (and any
amendment or supplement thereto), present fairly in all material respects
the consolidated financial position, results of operations and changes in
financial position of the Company and its consolidated subsidiaries on the
basis stated in the Registration Statement at the respective dates or for
the respective periods to which they apply; such statements and related
schedules and notes have been prepared in accordance with generally
accepted accounting principles consistently applied throughout the periods
involved, except as disclosed therein; and the other financial and
statistical information and data of the Company (including any pro forma
financial information) set forth in the Registration Statement and the
Prospectus (and any amendment or supplement thereto) is, in all material
respects, accurately presented and prepared on a basis consistent with such
financial statements and the books and records of the Company.
(m) The Company is not, nor is it directly or indirectly controlled by or
acting on behalf of any person which is, (i) an "investment company" within
the meaning of the Investment Company Act of 1940, as amended, and the
rules and regulations promulgated by the Commission thereunder, or (ii) a
"holding company" within the meaning of, or subject to regulation under,
the Public Utility Holding Company Act of 1935, as amended, and the rules
and regulations promulgated by the Commission thereunder.
(n) The Company has complied with all provisions of Section 517.075,
Florida Statutes (Chapter 92-198, Laws of Florida).
2. Purchase and Sale. The obligations of the Underwriters to purchase, and
the Company to sell, the Debt Securities shall be evidenced by the Terms
Agreement. The Terms Agreement shall specify the principal amount of Debt
Securities, the names of the Underwriters participating in such offering
(subject to substitution as provided in Section 8 hereof), the principal
amount of Debt Securities which each such Underwriter severally agrees to
purchase, the purchase price to be paid by the Underwriters for the Debt
Securities, the initial public
3
offering price, the time and place of delivery and payment, any delayed
delivery arrangements and any other terms of the Debt Securities not already
specified in the Indenture (including, but not limited to, designations,
denominations, interest rates or formulas and payment dates, maturity dates,
conversion provisions, redemption provisions and sinking fund requirements).
The several commitments of the Underwriters to purchase Debt Securities
pursuant to the Terms Agreement shall be deemed to have been made on the basis
of the representations and warranties herein contained and shall be subject to
the terms and conditions herein set forth.
Payment of the purchase price for, and delivery of, any Debt Securities to
be purchased by the Underwriters shall be made at the office of Fried, Frank,
Harris, Xxxxxxx & Xxxxxxxx, Xxx Xxx Xxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, or
at such other place as shall be agreed upon by the Representative(s) and the
Company, at (9:00) A.M., New York City time, on the third or fourth business
day (unless otherwise permitted by the Commission pursuant to Rule 15c6-1 of
the Exchange Act, or postponed in accordance with the provisions of Section 8
hereof) following the date of the Terms Agreement or such other time as shall
be agreed upon by the Representative(s) and the Company (each such time and
date being referred to as a "Closing Time"). Payment shall be made to the
Company by wire transfer of immediately available (same-day) funds, against
delivery to the Representative(s) for the respective accounts of the
Underwriters of the Debt Securities to be purchased by them. Certificates for
such Debt Securities shall be in such denominations and registered in such
names as the Representative(s) may request in writing at least two business
days prior to the applicable Closing Time. Such certificates will be made
available for examination and packaging by the Representative(s) on or before
the first business day prior to Closing Time.
3. Covenants of the Company. In further consideration of the agreements of
the Underwriters contained herein, the Company covenants as follows:
(a) Immediately following the execution of the Terms Agreement, the
Company will prepare a Prospectus Supplement setting forth the principal
amount of Debt Securities covered thereby and their terms not otherwise
specified in the Indenture, the names of the Underwriters participating in
the offering and the
4
principal amount of Debt Securities which each severally has agreed to
purchase, the price at which the Debt Securities are to be purchased by the
Underwriters from the Company, the initial public offering price, the
selling concession and reallowance, if any, any delayed delivery
arrangements, and such other information as the Representative(s) and the
Company deem appropriate in connection with the offering of the Debt
Securities. The Company will promptly transmit copies of the Prospectus
Supplement to the Commission for filing pursuant to Rule 424 of the
Securities Act and will furnish to the Underwriters named therein as many
copies of the Prospectus and such Prospectus Supplement as the
Representative(s) shall reasonably request.
(b) To furnish to the Representative(s), without charge, one signed copy
of the Registration Statement (including exhibits thereto) and for delivery
to each other Underwriter a conformed copy of the Registration Statement
(without exhibits thereto) and, during the period mentioned in paragraph
(c) below, as many copies of the Prospectus, any documents incorporated by
reference therein and any supplements and amendments thereto or to the
Registration Statement as the Representative(s) may reasonably request.
(c) At any time when the Prospectus is required by the Securities Act to
be delivered in connection with sales of the Debt Securities, the Company
will give the Representative(s) notice of its intention to file any
amendment to the Registration Statement or any amendment or supplement to
the Prospectus (including any term sheet within the meaning of Rule 434
under the Securities Act ), whether pursuant to the Securities Act, the
Exchange Act or otherwise, and will furnish the Representative(s) with
copies of each such proposed amendment or supplement or other documents
proposed to be filed a reasonable time in advance of filing.
(d) To advise the Representative(s) promptly and, if requested by the
Representative(s), to confirm such advice in writing, (i) of any request by
the Commission for amendments to the Registration Statement or amendments
or supplements to the Prospectus or for additional information, (ii) of the
issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or of the suspension of qualification of the
Securities for offering or sale in any jurisdiction, or the initiation of
any proceeding for such purposes, and (iii) of the happening of any event
during the period referred to in paragraph (c) above which makes any
statement of a material fact made in the Registration Statement or the
Prospectus untrue or which requires the making of any additions to or
changes in the Registration Statement in order to make the statements
therein not misleading or the Prospectus in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. If at any time the Commission shall issue any stop order
suspending the effectiveness of the Registration Statement, the Company
will make every reasonable effort to obtain the withdrawal or lifting of
such order at the earliest possible time.
(e) If, at any time when the Prospectus is required by the Securities Act
to be delivered in connection with sales of any of the Debt Securities, any
event shall occur or condition exist as a result of which it is necessary,
in the opinion of counsel for the Underwriters or counsel for the Company,
to amend or supplement the Prospectus in order to make the statements
therein, in the light of the circumstances under which they were made when
the Prospectus is delivered to a purchaser, not misleading, or if, in the
opinion of either such counsel, it is necessary to amend or supplement the
Prospectus to comply with U.S. laws [and, if appropriate, foreign laws],
the Company will promptly prepare and file with the Commission and furnish,
at its own expense, to the Underwriters, and to the dealers (whose names
and addresses the Representative(s) will furnish to the Company) to which
Debt Securities may have been sold by the Representative(s) on behalf of
the Underwriters and to any other dealer upon request, either amendments or
supplements to the Prospectus so that the statements in the Prospectus as
so amended or supplemented will not, in the light of the circumstances
under which they were made when the Prospectus is delivered to a purchaser,
be misleading or so that the Prospectus, as so amended or supplemented,
will comply with such U.S. laws [and, if appropriate, foreign laws].
(f) The Company will endeavor in good faith to qualify the Debt
Securities for offer and sale under the securities or Blue Sky laws of such
jurisdictions as the Representative(s) shall reasonably request; provided,
however, that the Company shall not be obligated to file any general
consent to service or to qualify as a foreign corporation in any
jurisdiction in which it is not so qualified. The Company will maintain
such
5
qualification in effect for so long as may be required for the distribution
of the Debt Securities. The Company will file such statements and reports
as may be required by the laws of each jurisdiction in which the Debt
Securities have been qualified as above provided.
(g) With respect to each sale of Debt Securities, the Company will make
generally available to its security holders as soon as practicable an
earnings statement which shall satisfy the provisions of Section 11(a) of
the Securities Act and Rule 158 of the Commission thereunder.
(h) Unless otherwise provided in the Terms Agreement, between the date of
the Terms Agreement and the later of termination of any trading
restrictions and the Closing Time with respect to the Debt Securities
covered thereby (it being understood that the Representative(s) promptly
will notify the Company as to the termination of trading restrictions on
such Debt Securities), the Company will not, without the Representative(s')
prior consent, offer to sell, enter into any agreement to sell, or
guarantee any new issue of Debt Securities with a maturity of more than [ ]
year(s), including additional Debt Securities (other than INSERT AGREED
UPON EXCEPTIONS).
(i) To use its reasonable efforts to do and perform all things required
or necessary to be done and performed under this Agreement by the Company
prior to the Closing Time and to satisfy all conditions precedent to the
delivery of the Debt Securities.
4. Conditions to Closing. The several obligations of the Underwriters to
purchase Debt Securities pursuant to the Terms Agreement are subject to the
following conditions:
(a) All the representations and warranties of the Company contained in
this Agreement shall be true and correct at the applicable Closing Time
with the same force and effect as if made on and as of such Closing Time.
(b) As of the applicable Closing Time, there shall not have been, since
the date of the Terms Agreement or since the respective dates as of which
information is given in the Registration Statement and the Prospectus, as
amended and supplemented,
(i) any downgrading, nor shall any notice have been given of any
intended or potential downgrading or of any review for a possible
change that does not indicate the direction of the possible change, in
the rating accorded any of the Company's securities by any "nationally
recognized statistical rating organization", as such term is defined
for purposes of Rule 436(g)(2) under the Securities Act; and
(ii) any change, or any development involving a prospective change,
in the assets, business, financial condition or results of operations
of the Company and its subsidiaries, taken as a whole, from that set
forth in the Prospectus, as amended or supplemented as of such time,
that, in the reasonable judgment of the Representative(s), is material
and adverse and that makes it, in the reasonable judgment of the
Representative(s), impracticable to market the Debt Securities on the
terms and in the manner contemplated in the Prospectus, as so amended
or supplemented.
(c) The Representative(s) shall have received at the applicable Closing
Time a certificate, dated the applicable Closing Time and signed by an
executive officer of the Company, to the effect set forth in clauses (b)
(i) and (ii) above and to the effect that the representations and
warranties of the Company contained in this Agreement are true and correct
at the applicable Closing Time and that the Company has complied in all
material respects with all of the agreements and satisfied all of the
conditions on its part to be performed or satisfied on or before the
applicable Closing Time. The officer signing and delivering such
certificate may rely upon the best of his knowledge with respect to
Sections 1(a) and 1(k) as to proceedings contemplated or threatened.
(d) The Representative(s) shall have received at the applicable Closing
Time (i) an opinion of Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx, special
counsel to the Company, addressing the matters set forth in
6
Exhibit A attached hereto, and (ii) an opinion of the (General Counsel)
(Associate General Counsel) of the Company, addressing the matters set
forth in Exhibit B attached hereto.
(e) The Representative(s) shall have received at the applicable Closing
Time an opinion of ( ), special counsel for the Underwriters, dated the
applicable Closing Time, with respect to all such matters as the
Representative(s) may reasonably request.
(f) The Representative(s) shall have received on the date of the Terms
Agreement and as of the applicable Closing Time a letter, dated such date,
in form and substance satisfactory to the Representative(s), from
independent accountants for the Company, containing statements and
information of the type ordinarily included in accountants' "comfort
letters" with respect to the financial statements and certain financial
information contained in or incorporated by reference into the Prospectus.
If any condition specified in this Section shall not have been fulfilled
when and as required to be fulfilled, this Agreement may be terminated by the
Representative(s) by notice to the Company at any time at or prior to the
applicable Closing Time, and such termination shall be without any liability
of any party to any other party except as provided in Section 5.
5. Payment of Expenses. The Company will pay all expenses, fees and taxes
incident to the performance of its obligations under the Terms Agreement
(which incorporates by reference this Underwriting Agreement), including,
without limitation (i) the preparation and filing of the Registration
Statement and the Prospectus and all amendments and supplements thereto, and
the reproduction of this Agreement, (ii) the preparation, issuance and
delivery of the Debt Securities to the Underwriters, (iii) the fees and
disbursements of the Company's counsel and accountants and the Trustee and its
counsel, (iv) the qualification of the Debt Securities under securities laws
in accordance with the provisions of Section 3(f), including filing fees and
the fees and disbursements of counsel for the Underwriters in connection
therewith and in connection with the preparation of any Blue Sky Surveys and
Legal Investment Surveys, (v) the printing and delivery to the Underwriters in
quantities as hereinabove stated of copies of the Registration Statement and
any amendments thereto, and of the Prospectus and any amendment or supplement
thereto, (vi) the reproduction and delivery to the Underwriters of copies of
the Indenture and any Blue Sky Surveys and Legal Investment Surveys, (vii) the
fees, if any, charged by rating agencies for rating the Debt Securities,
(viii) the fees and expenses, if any, incurred in connection with the listing
of the Debt Securities on any national securities exchange, and (ix) the fees
and expenses, if any, relating to clearance with the National Association of
Securities Dealers, Inc.
6. Indemnification and Contribution. The Company agrees to indemnify and
hold harmless each Underwriter and each person, if any, who controls such
Underwriter within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act from and against any and all losses, claims,
damages and liabilities (including, without limitation, any legal or other
expenses reasonably incurred by any Underwriter or any such controlling person
in connection with defending or investigating any such action or claim) caused
by any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or any amendment thereof, any
preliminary prospectus or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto), or caused
by any omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading, except insofar
as such losses, claims, damages or liabilities are caused by any such untrue
statement or omission or alleged untrue statement or omission based upon
information furnished to the Company in writing by any Underwriter through the
Representative(s) expressly for use therein or was based on the Form T-1 of
the Trustee. The foregoing indemnity with respect to any preliminary
prospectus or any Prospectus that is supplemented or amended shall not inure
to the benefit of any Underwriter (or any person controlling such Underwriter)
from whom the person asserting any such loss, claim, damage or liability
purchased the Debt Securities which are the subject thereof if such
Underwriter in a
7
timely manner received a copy of such Prospectus (or such Prospectus as so
amended or supplemented), and a copy of the Prospectus (or the Prospectus as
amended or supplemented), excluding documents incorporated therein by
reference, was not sent or given by or on behalf of such Underwriter to such
person, at or prior to the confirmation of the sale of such Debt Securities to
such person in any case where delivery of a Prospectus (or an amended or
supplemented Prospectus) at or prior to the written confirmation of the sale
of the Debt Securities is required by the Securities Act and the untrue
statement or omission or the alleged untrue statement or omission was
corrected in the Prospectus (or the Prospectus as amended or supplemented).
Each Underwriter agrees, severally and not jointly, to indemnify and hold
harmless the Company, its directors, its officers who sign the Registration
Statement and each person, if any, who controls the Company within the meaning
of either Section 15 of the Securities Act or Section 20 of the Exchange Act
from and against any and all losses, claims, damages and liabilities
(including, without limitation, any legal or other expenses reasonably
incurred by the Company, its directors, such officers or any such controlling
person in connection with defending or investigating any such action or claim)
caused by any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or any amendment thereof, any
preliminary prospectus or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto), or caused
by any omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading, but only with
reference to information relating to such Underwriter furnished to the Company
by such Underwriter in writing through the Representative(s) expressly for use
in the Registration Statement, any preliminary prospectus, the Prospectus or
any amendments or supplements thereto.
Promptly after receipt by an indemnified party under the first or second
paragraph in this Section 6 of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against
the indemnifying party under this Section, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have
to any indemnified party otherwise than under this Section. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall
pay the reasonable expenses of legal counsel to the indemnified party as
incurred and shall be entitled to participate therein and, to the extent that
it shall wish, jointly with any other indemnifying party similarly notified,
to assume the defense thereof, with counsel reasonably satisfactory to such
indemnified party (who shall not, except with the consent of the indemnified
party, be counsel to the indemnifying party), and, after notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party shall not be liable to such
indemnified party under such subsection for any legal expenses of other
counsel or any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than
reasonable costs of investigation, and the indemnifying party shall not be
responsible for the cost of more than one counsel for all indemnified parties
(excluding any necessary local counsel) in connection with any actions arising
from the same facts. No indemnifying party shall, without the written consent
of the indemnified party, effect the settlement or compromise of, or consent
to the entry of any judgment with respect to, any pending or threatened action
or claim in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified party is an actual or potential
party to such action or claim) unless such settlement, compromise or judgment
(i) includes an unconditional release of the indemnified party from all
liability arising out of such action or claim, and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to act, by
or on behalf of any indemnified party.
If the indemnification provided for in the first or second paragraph in this
Section 6 is unavailable to an indemnified party or insufficient in respect of
any losses, claims, damages or liabilities referred to therein, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable
by such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Underwriters on the
other hand from the offering of the Debt Securities or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to
8
reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company on the one hand and of the Underwriters
on the other hand in connection with the statements or omissions that resulted
in such losses, claims, damages or liabilities, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the Underwriters on the other hand in connection with the
offering of the Debt Securities shall be deemed to be in the same respective
proportions as the net proceeds from the offering of such Debt Securities
(before deducting expenses) received by the Company and the total underwriting
discounts and commissions received by the Underwriters, in each case as set
forth in the table on the cover of the Prospectus Supplement, bear to the
aggregate public offering price of the Debt Securities. The relative fault of
the Company on the one hand and of the Underwriters on the other hand shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company or by the
Underwriters and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Underwriters' respective obligations to contribute pursuant to this
Section 6 are several in proportion to the respective principal amounts of
Debt Securities purchased by each of such Underwriters and not joint.
The Company and the Underwriters agree that it would not be just or
equitable if contribution pursuant to this Section 6 were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of
the losses, claims, damages and liabilities referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 6, no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Debt Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages that such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The remedies provided
for in this Section 6 are not exclusive and shall not limit any rights or
remedies which may otherwise be available to any indemnified party at law or
in equity.
The indemnity and contribution provisions contained in this Section 6 and
the representations and warranties of the Company contained herein or made
pursuant hereto shall remain operative and in full force and effect regardless
of (i) any termination of this Agreement, (ii) any investigation made by or on
behalf of any Underwriter or any person controlling any Underwriter or by or
on behalf of the Company, its directors or officers or any person controlling
the Company, and (iii) acceptance of and payment for any of the Debt
Securities.
7. Termination. This Agreement may be terminated, upon written notice given
by the Representative(s) to the Company, at any time prior to the applicable
Closing Time, if (a) after the execution and delivery of the Terms Agreement
and prior to the Closing Time (i) since the respective dates as of which
information is given in the Registration Statement and the Prospectus, except
as may otherwise be stated in or contemplated by the Registration Statement
and the Prospectus, any material adverse change, or any development involving
a prospective material adverse change, in the assets, business, financial
condition or results of operations of the Company and its subsidiaries taken
as a whole occurs, (ii) trading generally shall have been suspended or
materially limited on or by, as the case may be, any of the New York Stock
Exchange, the American Stock Exchange or the NASDAQ National Market, (iii)
trading of any securities of the Company shall have been suspended on any
national securities exchange or on the NASDAQ National Market, (iv) a general
moratorium on commercial banking activities in New York shall have been
declared by either Federal or New York State authorities, or (v) there shall
have occurred any outbreak or escalation of hostilities or any change in
financial markets or any calamity or crisis that, in the reasonable judgment
of the Representative(s), is material and
9
adverse, and (b) in the case of any of the events specified in clauses (a)(i)
through (v), such event, singly or together with any other such event, makes
it, in the reasonable judgment of the Representative(s), impracticable to
market the Debt Securities on the terms and in the manner contemplated by the
Prospectus and the Prospectus Supplement, as such may be amended or
supplemented.
8. Defaulting Underwriters. If one or more of the Underwriters participating
in an offering of Debt Securities shall fail or refuse at the applicable
Closing Time to purchase Debt Securities which it or they are obligated to
purchase under the applicable Terms Agreement (the "Defaulted Securities"),
and the aggregate amount of Defaulted Securities is not more than one-tenth of
the aggregate amount of the Debt Securities to be purchased pursuant to the
Terms Agreement, the non-defaulting Underwriters named in such Terms Agreement
shall be obligated severally in the proportions that the amount of Debt
Securities set forth opposite their respective names above bears to the
aggregate amount of Debt Securities set forth opposite the names of all such
non-defaulting Underwriters, or in such other proportions as the
Representative(s) may specify, to purchase the Debt Securities which such
defaulting Underwriter or Underwriters agreed but failed or refused to
purchase on such date; provided that in no event shall the amount of Debt
Securities that any Underwriter has agreed to purchase pursuant to this
Agreement be increased pursuant to this Section 8 by an amount in excess of
[one-ninth] of such amount of Debt Securities without the written consent of
such Underwriter. If, at the applicable Closing Time, any Underwriter or
Underwriters shall fail or refuse to purchase Debt Securities and the
aggregate amount of Debt Securities with respect to which such default occurs
is more than one-tenth of the aggregate amount of Debt Securities to be
purchased pursuant to such Terms Agreement, and arrangements satisfactory to
the Representative(s) and the Company for the purchase of such Debt Securities
are not made within 48 hours after such default, this Agreement shall
terminate without liability on the part of any non-defaulting Underwriter or
the Company. In any such case either the Representative(s) or the Company
shall have the right to postpone the Closing Time but in no event for longer
than seven days, in order that the required changes, if any, in the
Registration Statement and in the Prospectus or in any other documents or
arrangements may be effected. Any action taken under this paragraph shall not
relieve any defaulting Underwriter from liability in respect of any default of
such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of them,
because of any failure or refusal on the part of the Company to comply with
the terms or to fulfill any of the conditions of this Agreement, or if for any
reason the Company shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for
all out-of-pocket expenses (including the fees and disbursements of their
counsel) reasonably incurred by such Underwriters in connection with this
Agreement or the offering of the Debt Securities.
9. Parties. This Agreement shall inure to the benefit of and be binding upon
the Company and any Underwriter who becomes a party hereto, and their
respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the parties hereto or thereto and their respective successors and the
controlling persons and officers and directors referred to in Section 6 and
their heirs and legal representatives, any legal or equitable right, remedy or
claim under or in respect of this Agreement or any provision herein contained.
This Agreement and all conditions and provisions hereof are intended to be for
the sole and exclusive benefit of the parties and their respective successors
and said controlling persons and officers and directors and their heirs and
legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of Debt Securities from any Underwriter shall be
deemed to be a successor by reason merely of such purchase.
10. Counterparts. The Underwriting Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
11. Governing Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York.
10
12. Headings. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
13. Notices. All references herein and in the Underwriting Agreement to the
Representative(s) when made in connection with any notice to or communication
by or with such Representative(s) shall, if there is more than one
representative, be deemed to be to the Lead Representative, as designated in
the Terms Agreement, and all notices shall be given to such Lead
Representative at the address set forth therein.
11
Exhibit A
Opinion of [ ], Counsel for the Company
The opinion of counsel for the Company to be delivered pursuant to Section
4(d) of the Underwriting Agreement shall be to the effect that:
(i) the Registration Statement has become effective under the Securities
Act, and, to the best knowledge of such counsel, no stop order suspending
its effectiveness of the Registration Statement is in effect, and no
proceedings for that purpose are pending before or, to such counsel's
knowledge, contemplated by the Commission;
(ii) the Underwriting Agreement and the Delayed Delivery Contracts, if
any, have been duly authorized, executed and delivered by the Company;
(iii) the form and terms of the Debt Securities have been duly and
validly authorized and established in conformity with the provisions of the
Indenture by all necessary corporate action by the Company, and when such
Debt Securities have been duly executed, authenticated and delivered
against payment therefor in accordance with the provisions of the Indenture
and this Agreement, they will constitute the legal, valid and binding
obligations of the Company, enforceable against the Company in accordance
with their terms and the terms of the Indenture, except as such enforcement
may be limited by the Bankruptcy Exceptions; and the Indenture has been
duly authorized, executed and delivered by the Company, has been qualified
under the Trust Indenture Act, and constitutes a legal, valid and binding
obligation enforceable against the Company in accordance with its terms,
except as such enforcement may be limited by the Bankruptcy Exceptions;
(iv) the execution and delivery by the Company of, and the performance by
the Company of its obligations under, the Underwriting Agreement, the
Indenture and the Debt Securities will not violate any provision of
applicable law or the Restated Certificate of Incorporation, as amended, or
By-laws of the Company;
(v) no consent, approval, authorization or order of or qualification with
any United States federal, New York or (with respect to matters arising
under the Delaware General Corporation Law) Delaware body or agency is
required for the performance by the Company of its obligations under the
Underwriting Agreement, the Indenture or the Debt Securities, except such
as may be required by the securities or Blue Sky laws of the various states
in connection with the offer and sale of the Debt Securities or except when
the failure to obtain such consent, approval, authorization, order or
qualification would not, individually or in the aggregate, have a Material
Adverse Effect;
(vi) the Company is not (A) an "investment company" within the meaning of
the Investment Company Act of 1940, as amended, and the rules and
regulations promulgated by the Commission thereunder, or (B) a "holding
company" within the meaning of, or subject to regulation under, the Public
Utility Holding Company Act of 1935, as amended, and the rules and
regulations promulgated by the Commission thereunder;
(vii) the statements (A) in the Prospectus Supplement under the caption
"Certain Terms of the Debt Securities" and in the Basic Prospectus under
the caption "Description of Debt Securities," and (B) in the Registration
Statement under Item 15, insofar as such statements constitute a summary of
the legal matters referred to therein, fairly present the information
disclosed therein in all material respects;
(viii) such counsel is of the opinion that (A) each document, if any,
filed pursuant to the Exchange Act and incorporated by reference in the
Prospectus (except for financial statements and schedules and other
financial or statistical data included therein as to which such counsel
need not express any opinion) complied when so filed as to form in all
material respects with the Exchange Act and the applicable rules and
regulations of the Commission thereunder, and (B) the Registration
Statement and Prospectus (except for financial statements and schedules and
other financial or statistical data included therein as to which such
counsel need not express any opinion) comply as to form in all material
respects with the requirements of the Securities Act, the Trust Indenture
Act and the applicable rules and regulations of the Commission thereunder.
A-1
In addition, such counsel shall state that in the course of the preparation
by the Company of the Registration Statement, the Prospectus and the
Prospectus Supplement, such counsel participated in conferences with certain
of the officers and representatives of the Company and the Company's
independent accountants, at which the Registration Statement, the Prospectus
and the Prospectus Supplement were discussed. Given the limitations inherent
in the independent verification of factual matters and the character of
determinations involved in the registration process, such counsel does not
pass upon and need not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement, the Prospectus or the Prospectus Supplement, except as specifically
described in the opinion in paragraph (vii) above. Subject to the foregoing
and on the basis of the information such counsel gained in the performance of
the services referred to above, including information obtained from officers
and other representatives of the Company and the Company's independent
accountants, such counsel shall state that no facts have come to such
counsel's attention that have caused it to believe that the Registration
Statement, at the time it became effective [or at the time an Annual Report on
Form 10-K was filed (whichever is later)], contained any untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary in order to make the statements therein not misleading or
that the Prospectus and any Prospectus Supplement, as of their respective
dates [and at the date hereof], included or includes, as the case may be, any
untrue statement of a material fact or omitted or omits, as the case may be,
to state a material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading. Such
counsel need express no view or belief, however, with respect to (i) financial
statements, schedules or notes thereto or other financial and statistical data
included in or omitted from the Registration Statement or Prospectus or any
Prospectus Supplement or (ii) any part of the Registration Statement which
shall constitute a Statement of Eligibility on Form T-1 under the Trust
Indenture Act.
With respect to the preceding paragraph, Fried, Frank, Harris, Xxxxxxx &
Xxxxxxxx may state that (A) their opinion and belief is based upon their
participation in the preparation of the Registration Statement and Prospectus
and any amendments or supplements thereto and review and discussion of the
contents thereof, but are without independent check or verification, except as
specified, (B) no opinion or belief is being expressed with respect to Tenneco
Inc. and its businesses other than Tenneco Energy, [and (C) no opinion or
belief is being expressed with respect to documents incorporated by reference
in the Registration Statement and Prospectus].
A-2
Exhibit B
Opinion of ( ), (General Counsel) (Associate General
Counsel) of the Company
The opinion of ( ), general counsel of the Company, to be delivered pursuant
to Section 4(d) of the Underwriting Agreement shall be to the effect that:
(i) the Company has been duly incorporated and is validly existing and in
good standing under the laws of the State of Delaware;
(ii)(A) the Company has the corporate power and authority to own its
properties and to conduct its business as described in the Prospectus, as
amended or supplemented, and (B) the Company is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not have a
Material Adverse Effect;
(iii) each Subsidiary of the Company has been duly incorporated and is a
corporation duly organized, validly existing in good standing under the
laws of the jurisdiction of its incorporation, has the corporate power and
authority to own its properties and to conduct its business as described in
the Prospectus and is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which the conduct
of its business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so qualified or
be in good standing would not have a Material Adverse Effect;
(iv) the execution and delivery by the Company of, and the performance by
the Company of its obligations under, the Underwriting Agreement, the
Indenture and the Debt Securities will not violate, to the best of such
counsel's knowledge (A) any agreement or other instrument binding upon the
Company or any Subsidiaries, or (B) to the best of such counsel's
knowledge, any judgment, order or decree of any governmental body, agency
or court having jurisdiction over the Company or any Subsidiary except, in
each case, for such violations as would not, individually or in the
aggregate, have a Material Adverse Effect;
(v) the statements under the caption (A) "Item 3--Legal Proceedings" of
the Company's most recent annual report on Form 10-K incorporated by
reference into the Prospectus and (B) "Item 1--Legal Proceedings" of Part
II of the Company's quarterly reports on Form 10-Q, if any, filed since
such annual report, in each case insofar as such statements constitute
summaries of the legal matters, documents or proceedings referred to
therein, fairly present the information disclosed therein in all material
respects;
(vi) after due inquiry, such counsel does not know of any legal or
governmental proceedings instituted or threatened against the Company or
any of its subsidiaries which would restrict the issuance and sale of the
Debt Securities as contemplated by the Prospectus, or would be required to
be disclosed therein and which is not disclosed; also, such counsel does
not know of any statutes, regulations, contracts or other documents which
are required to be summarized in the Registration Statement or the
Prospectus or to be filed or incorporated by reference as exhibits to the
Registration Statement which are not summarized, filed or incorporated as
required; and
(vii) such counsel is of the opinion that (A) each document, if any,
filed pursuant to the Exchange Act and incorporated by reference in the
Prospectus (except for financial statements and schedules and other
financial or statistical data included therein as to which such counsel
need not express any opinion) complied when so filed as to form in all
material respects with the Exchange Act and the applicable rules and
regulations of the Commission thereunder, and (B) the Registration
Statement and Prospectus (except for financial statements and schedules and
other financial or statistical data included therein as to which such
counsel need not express any opinion) comply as to form in all material
respects with the requirements of the Securities Act, the Trust Indenture
Act and the applicable rules and regulations of the Commission thereunder.
In addition, such counsel shall state that in the course of the preparation
by the Company of the Registration Statement, the Prospectus and the
Prospectus Supplement, such counsel participated in conferences with certain
B-1
of the officers and representatives of the Company, counsel to the Company and
the Company's independent accounts, at which the Registration Statement, the
Prospectus and the Prospectus Supplement were discussed. Given the limitations
inherent in the independent verification of factual matters and the character
of determinations involved in the registration process, such counsel does not
pass upon and need not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement, the Prospectus or the Prospectus Supplement, except as specifically
described in paragraph (vii) above subject to the foregoing and on the basis
of the information such counsel gained in the performance of the services
referred to above and in the performance of his duties as (General Counsel)
(Associate General Counsel) of the Company, as well as information obtained
from officers and other representatives of the Company, such counsel shall
state that no facts have come to such counsel's attention that have caused him
to believe that the Registration Statement, at the time it became effective
[or at the time an Annual Report on Form 10-K was filed (whichever is later)],
contained any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order to make the
statements therein not misleading or that the Prospectus and any Prospectus
Supplement, as of their respective dates [and at the date hereof], included or
includes, as the case may be, any untrue statement of a material fact or
omitted or omits, as the case may be, to state a material fact necessary in
order to make the statements therein, in light of the circumstances under
which they were made, not misleading. Such counsel need express no view or
belief, however, with respect to (i) financial statements, schedules or notes
thereto or other financial data included in or omitted from the Registration
Statement or Prospectus or any Prospectus Supplement or (ii) any part of the
Registration Statement which shall constitute a Statement of Eligibility on
Form T-1 under the Trust Indenture Act.
With respect to the preceding paragraph, such counsel may state that no
opinion or belief is being expressed with respect to Tenneco Inc. and its
business other than Tenneco Energy.
B-2
