EXHIBIT 1.1
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OAKWOOD HOMES CORPORATION
(a North Carolina corporation)
UNDERWRITING AGREEMENT
[Date]
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TABLE OF CONTENTS
Page
SECTION 1. Representations and Warranties..................................................3
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(a) REPRESENTATIONS AND WARRANTIES BY THE COMPANY...................................3
(b) OFFICER'S CERTIFICATES.........................................................11
SECTION 2. Sale and Delivery to Underwriters; Closing....................................11
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(a) UNDERWRITTEN SECURITIES........................................................11
(b) OPTION UNDERWRITTEN SECURITIES.................................................11
(c) PAYMENT........................................................................12
(d) DENOMINATIONS; REGISTRATION....................................................12
SECTION 3. Covenants of the Company.......................................................12
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(a) COMPLIANCE WITH SECURITIES REGULATIONS AND COMMISSION REQUESTS.................13
(b) FILING OF AMENDMENTS...........................................................13
(c) DELIVERY OF REGISTRATION STATEMENTS............................................13
(d) DELIVERY OF PROSPECTUSES.......................................................13
(e) CONTINUED COMPLIANCE WITH SECURITIES LAWS......................................14
(f) BLUE SKY QUALIFICATIONS........................................................14
(g) EARNINGS STATEMENT.............................................................14
(h) RESERVATION OF SECURITIES......................................................15
(i) USE OF PROCEEDS................................................................15
(j) LISTING........................................................................15
(k) RESTRICTION ON SALE OF SECURITIES..............................................15
(l) REPORTING REQUIREMENTS.........................................................15
SECTION 4. Payment of Expenses............................................................15
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(a) EXPENSES.......................................................................15
(b) TERMINATION OF AGREEMENT.......................................................16
SECTION 5. Conditions of Underwriters' Obligations........................................16
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(a) EFFECTIVENESS OF REGISTRATION STATEMENT........................................16
(b) OPINION OF COUNSEL FOR COMPANY.................................................16
(c) OPINION OF COUNSEL FOR UNDERWRITERS............................................16
(d) OFFICERS' CERTIFICATE..........................................................17
(e) ACCOUNTANT'S COMFORT LETTER....................................................17
(f) BRING-DOWN COMFORT LETTER......................................................17
(g) RATINGS........................................................................17
(h) APPROVAL OF LISTING............................................................18
(i) NO OBJECTION...................................................................18
(j) LOCK-UP ARRANGEMENTS...........................................................18
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(k) OVER-ALLOTMENT OPTION..........................................................18
(l) ADDITIONAL DOCUMENTS...........................................................19
(m) TERMINATION OF TERMS AGREEMENT.................................................19
SECTION 6. Indemnification................................................................19
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(a) INDEMNIFICATION OF UNDERWRITERS................................................19
(b) INDEMNIFICATION OF COMPANY, DIRECTORS AND OFFICERS.............................20
(c) ACTIONS AGAINST PARTIES; NOTIFICATION..........................................20
(d) SETTLEMENT WITHOUT CONSENT IF FAILURE TO REIMBURSE.............................21
SECTION 7. Contribution...................................................................21
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SECTION 8. Representations, Warranties and Agreements to Survive Delivery.................23
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SECTION 9. Termination....................................................................23
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(a) UNDERWRITING AGREEMENT.........................................................23
(b) TERMINATION; GENERAL...........................................................23
(c) LIABILITIES....................................................................24
SECTION 10. Default by One or More of the Underwriters.....................................24
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SECTION 11. Notices........................................................................24
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SECTION 12. Parties........................................................................25
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SECTION 13. GOVERNING LAW AND TIME.........................................................25
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SECTION 14. Effect of Headings.............................................................25
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OAKWOOD HOMES CORPORATION
(a North Carolina corporation)
Debt Securities
UNDERWRITING AGREEMENT
[_____________ __, _____]
To the Representative of the
Underwriters named in the
Terms Agreement
hereinafter described
Ladies and Gentlemen:
Oakwood Homes Corporation, a North Carolina corporation (the
"Company"), proposes to issue and sell up to $400,000,000 aggregate initial
public offering price of its senior or subordinated debt securities (the "Debt
Securities"), or any combination thereof, from time to time, in or pursuant to
one or more offerings on terms to be determined at the time of sale.
The Debt Securities will be issued in one or more series as senior
indebtedness (the "Senior Debt Securities") or as senior subordinated or
subordinated indebtedness (the "Subordinated Debt Securities") under an
indenture, dated as of [__________ ___], 1998 (the "Indenture"), between the
Company and [___________], as trustee (the "Trustee"). Each series of Debt
Securities may vary, as applicable, as to title, aggregate principal amount,
rank, interest rate or formula and timing of payments thereof, stated maturity
date, redemption and/or payment provisions, sinking fund requirements,
guarantors and any other variable terms established by or pursuant to the
applicable Indenture. As used herein, "Securities" shall mean the Senior Debt
Securities or Subordinated Debt Securities, or any combination thereof,
initially issuable by the Company.
Whenever the Company determines to make an offering of Securities, the
Company will enter into an agreement (each, a "Terms Agreement") providing for
the sale of such Securities to, and the purchase and offering thereof by, the
underwriters named in the applicable Terms Agreement (the "Underwriters," which
term shall include any Underwriter substituted pursuant to Section 10 hereof),
for whom the firm designated as representative of the Underwriters of such
Underwritten Securities in the Terms Agreement relating thereto will act as
representative (the "Representative"). The Terms Agreement relating to the
offering of Securities shall specify the aggregate principal amount, as the case
may be, of Securities to be initially issued (the "Initial Underwritten
Securities"), the name of each Underwriter participating in such offering
(subject
to substitution as provided in Section 10 hereof) and the name of any
Underwriter acting as co-manager in connection with such offering, the aggregate
principal amount, as the case may be, of Initial Underwritten Securities which
each such Underwriter severally agrees to purchase, whether such offering is on
a fixed or variable price basis and, if on a fixed price basis, the initial
offering price, the price at which the Initial Underwritten Securities are to be
purchased by the Underwriters, the form, time, date and place of delivery and
payment of the Initial Underwritten Securities and any other material variable
terms of the Initial Underwritten Securities. In addition, if applicable, such
Terms Agreement shall specify whether the Company has agreed to grant to the
Underwriters an option to purchase additional Securities to cover
over-allotments, if any, and the number or aggregate principal amount, as the
case may be, of Securities subject to such option (the "Option Underwritten
Securities"). As used herein, the term "Underwritten Securities" shall include
the Initial Underwritten Securities and all or any portion of any Option
Underwritten Securities. The Terms Agreement, which shall be substantially in
the form of EXHIBIT A hereto, may take the form of an exchange of any standard
form of written telecommunication between the Company and the Representative,
acting for itself and, if applicable, as representative of any other
Underwriters. Each offering of Underwritten Securities will be governed by this
Underwriting Agreement, as supplemented by the applicable Terms Agreement.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-________) for the
registration of the Securities under the Securities Act of 1933, as amended (the
"1933 Act"), and the offering thereof from time to time in accordance with Rule
415 of the rules and regulations of the Commission under the 1933 Act (the "1933
Act Regulations"), and the Company has filed such post-effective amendments
thereto as may be required prior to the execution of the applicable Terms
Agreement. Such registration statement (as so amended, if applicable) has been
declared effective by the Commission and each Indenture has been duly qualified
under the Trust Indenture Act of 1939, as amended (the "1939 Act"). Such
registration statement (as so amended, if applicable), including the
information, if any, deemed to be a part thereof pursuant to Rule 430A(b) of the
1933 Act regulations (the "Rule 430A Information") or Rule 434(d) of the 1933
Act Regulations (the "Rule 434 Information"), is referred to herein as the
"Registration Statement;" and the final prospectus and the final prospectus
supplement relating to the offering of the Underwritten Securities, in the form
first furnished to the Underwriters by the Company for use in connection with
the offering of the Underwritten Securities, are collectively referred to herein
as the "Prospectus;" PROVIDED, HOWEVER, that all references to the "Registration
Statement" and the "Prospectus" shall also be deemed to include all documents
incorporated therein by reference pursuant to the Securities Exchange Act of
1934, as amended (the "1934 Act"), prior to the execution of the applicable
Terms Agreement; PROVIDED FURTHER, that if the Company files a registration
statement with the Commission pursuant to Rule 462(b) of the 1933 Act
Regulations (the "Rule 462(b) Registration Statement"), then, after such filing,
all references to "Registration Statement" shall also be deemed to include the
Rule 462(b) Registration Statement; and, PROVIDED FURTHER, that if the Company
elects to rely upon Rule 434 of the 1933 Act Regulations, then all references to
"Prospectus" shall also be deemed to include the final or preliminary prospectus
and the applicable term sheet or abbreviated term sheet (the "Term
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Sheet"), as the case may be, in the form first furnished to the Underwriters by
the Company in reliance upon Rule 434 of the 1933 Act Regulations, and all
references in this Underwriting Agreement to the date of the Prospectus shall
mean the date of the Term Sheet. A "preliminary prospectus" shall be deemed to
refer to any prospectus used before the registration statement became effective
and any prospectus that omitted, as applicable, the Rule 430A Information, the
Rule 434 Information or other information to be included upon pricing in a form
of prospectus filed with the Commission pursuant to Rule 424(b) of the 1933 Act
Regulations, that was used after such effectiveness and prior to the execution
and delivery of the applicable Terms Agreement. For purposes of this
Underwriting Agreement, all references to the Registration Statement,
Prospectus, Term Sheet or preliminary prospectus or to any amendment or
supplement to any of the foregoing shall be deemed to include any copy filed
with the Commission pursuant to its Electronic Data Gathering, Analysis and
Retrieval system ("XXXXX").
All references in this Underwriting Agreement to financial statements
and schedules and other information which is "contained," "included" or "stated"
(or other references of like import) in the Registration Statement, Prospectus
or preliminary prospectus shall be deemed to mean and include all such financial
statements and schedules and other information which is incorporated by
reference in the Registration Statement, Prospectus or preliminary prospectus,
as the case may be; and all references in this Underwriting Agreement to
amendments or supplements to the Registration Statement, Prospectus or
preliminary prospectus shall be deemed to mean and include the filing of any
document under the 1934 Act which is incorporated by reference in the
Registration Statement, Prospectus or preliminary prospectus, as the case may
be.
SECTION 1. Representations and Warranties.
(a) REPRESENTATIONS AND WARRANTIES BY THE COMPANY. The Company
represents and warrants to the Representative, as of the date hereof, and to
each Underwriter named in the applicable Terms Agreement, as of the date
thereof, as of the Closing Time (as defined below) and, if applicable, as of
each Date of Delivery (as defined below) (in each case, a "Representation
Date"), as follows:
(i) COMPLIANCE WITH REGISTRATION REQUIREMENTS. The Company
meets the requirements for use of Form S-3 under the 1933 Act. Each of
the Registration Statement and any Rule 462(b) Registration Statement
has become effective under the 1933 Act and no stop order suspending
the effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to
the knowledge of the Company, are contemplated by the Commission, and
any request on the part of the Commission for additional information
has been complied with. In addition, the Indenture has been duly
qualified under the 1939 Act.
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At the respective times the Registration Statement, any Rule
462(b) Registration Statement and any post-effective amendments thereto
(including the filing of the Company's most recent Annual Report on
Form 10-K with the Commission (the "Annual Report on Form 10-K"))
became effective and at each Representation Date, the Registration
Statement, the Rule 462(b) Registration Statement and any amendments
and supplements thereto complied and will comply in all material
respects with the requirements of the 1933 Act and the 1933 Act
Regulations and the 1939 Act and the rules and regulations of the
Commission under the 1939 Act (the "1939 Act Regulations") and did not
and will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading. At the date of the
Prospectus, at the Closing Time and at each Date of Delivery, if any,
the Prospectus and any amendments and supplements thereto did not and
will not include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading. If the Company elects to rely upon Rule 434 of the 1933
Act Regulations, the Company will comply with the requirements of Rule
434. Notwithstanding the foregoing, the representations and warranties
in this subsection shall not apply to statements in or omissions from
the Registration Statement or the Prospectus made in reliance upon and
in conformity with information furnished to the Company in writing by
any Underwriter through the Representative expressly for use in the
Registration Statement or Prospectus.
Each preliminary prospectus and the prospectus filed as part
of the Registration Statement as originally filed or as part of any
amendment thereto, or filed pursuant to Rule 424 under the 1933 Act,
complied when so filed in all material respects with the 1933 Act
Regulations and each preliminary prospectus and the Prospectus
delivered to the Underwriters for use in connection with the offering
of Underwritten Securities will, at the time of such delivery, be
identical to any electronically transmitted copies thereof filed with
the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
(ii) INCORPORATED DOCUMENTS. The documents incorporated or
deemed to be incorporated by reference in the Registration Statement
and the Prospectus, at the time they were or hereafter are filed with
the Commission, complied and will comply in all material respects with
the requirements of the 1934 Act and the rules and regulations of the
Commission thereunder (the "1934 Act Regulations") and, when read
together with the other information in the Prospectus, at the date of
the Prospectus, at the Closing Time and at each Date of Delivery, if
any, did not and will not include an 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.
(iii) INDEPENDENT ACCOUNTANTS. The accountants who certified
the financial statements and supporting schedules thereto included in
the Registration Statement and
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the Prospectus are independent public accountants as required by the
1933 Act and the 1933 Act Regulations.
(iv) FINANCIAL STATEMENTS. The financial statements of the
Company included in the Registration Statement and the Prospectus,
together with the related schedules and notes, as well as those
financial statements, schedules and notes of any other entity included
therein, present fairly the financial position of the Company and its
consolidated subsidiaries, or such other entity, as the case may be, at
the dates indicated and the statement of operations, stockholders'
equity and cash flows of the Company and its consolidated subsidiaries,
or such other entity, as the case may be, for the periods specified.
Such financial statements have been prepared in conformity with
generally accepted accounting principles ("GAAP") applied on a
consistent basis throughout the periods involved. The supporting
schedules, if any, included in the Registration Statement and the
Prospectus present fairly in accordance with GAAP the information
required to be stated therein. The selected financial data and the
summary financial information included in the Prospectus present fairly
the information shown therein and have been compiled on a basis
consistent with that of the audited financial statements included in
the Registration Statement and the Prospectus. In addition, any pro
forma financial statements of the Company and its subsidiaries and the
related notes thereto included in the Registration Statement and the
Prospectus present fairly the information shown therein, have been
prepared in accordance with the Commission's rules and guidelines with
respect to pro forma financial statements and have been properly
compiled on the bases described therein, and the assumptions used in
the preparation thereof are reasonable and the adjustments used therein
are appropriate to give effect to the transactions and circumstances
referred to therein.
(v) NO MATERIAL ADVERSE CHANGE IN BUSINESS. Since the
respective dates as of which information is given in the Registration
Statement and the Prospectus, except as otherwise stated therein, (A)
there has been no material adverse change in the condition (financial
or otherwise), earnings, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise, whether or
not arising in the ordinary course of business (a "Material Adverse
Effect"), (B) there have been no transactions entered into by the
Company or any of its subsidiaries, other than those in the ordinary
course of business, which are material with respect to the Company and
its subsidiaries considered as one enterprise, and (C) except for
regular dividends on the Company's common stock or preferred stock, in
amounts per share that are consistent with past practice, there has
been no dividend or distribution of any kind declared, paid or made by
the Company on any class of its capital stock.
(vi) GOOD STANDING OF THE COMPANY. The Company has been duly
organized and is validly existing as a corporation in good standing
under the laws of the state of North Carolina and has corporate power
and authority to own, lease and operate its properties and to conduct
its business as described in the Prospectus and to enter into and
perform its obligations under, or as contemplated under, this
Underwriting Agreement
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and the applicable Terms Agreement. The Company is duly qualified as a
foreign corporation to transact business and is in good standing in
each other jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure to so qualify or be in
good standing would not result in a Material Adverse Effect.
(vii) GOOD STANDING OF SUBSIDIARIES. Each subsidiary of the
Company (each, a "Subsidiary" and, collectively, the "Subsidiaries")
has been duly organized and is validly existing as a corporation in
good standing under the laws of the jurisdiction of its incorporation,
has corporate power and authority to own, lease and operate 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 such qualification is
required, whether by reason of the ownership or leasing of property or
the conduct of business, except where the failure to so qualify or be
in good standing would not result in a Material Adverse Effect. Except
as otherwise stated in the Registration Statement and the Prospectus,
all of the issued and outstanding capital stock of each such Subsidiary
has been duly authorized and is validly issued, fully paid and
non-assessable and is owned by the Company, directly or through
subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equity. None of the outstanding
shares of capital stock of any Subsidiary was issued in violation of
preemptive or other similar rights of any securityholder of such
Subsidiary.
(viii) CAPITALIZATION. If the Prospectus contains a
"Capitalization" section, the authorized, issued and outstanding shares
of capital stock of the Company is as set forth in the column entitled
"Actual" under such section (except for subsequent issuances thereof,
if any, contemplated under this Underwriting Agreement, pursuant to
reservations, agreements or employee benefit plans referred to in the
Prospectus or pursuant to the exercise of convertible securities or
options referred to in the Prospectus). Such shares of capital stock
have been duly authorized and validly issued by the Company and are
fully paid and non-assessable; and none of such shares of capital stock
was issued in violation of preemptive or other similar rights of any
securityholder of the Company.
(ix) AUTHORIZATION OF THIS UNDERWRITING AGREEMENT AND TERMS
AGREEMENT. This Underwriting Agreement has been, and the applicable
Terms Agreement as of the date thereof will have been, duly authorized,
executed and delivered by the Company.
(x) AUTHORIZATION OF SENIOR DEBT SECURITIES AND/OR
SUBORDINATED DEBT SECURITIES. The Underwritten Securities have been, or
as of the date of such Terms Agreement will have been, duly authorized
by the Company for issuance and sale pursuant to this Underwriting
Agreement and such Terms Agreement. Such Underwritten Securities, when
issued and authenticated in the manner provided for in the applicable
Indenture and delivered against payment of the consideration therefor
specified in such Terms Agreement, will constitute valid and legally
binding obligations
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of the Company, enforceable against the Company in accordance with
their terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to or affecting creditors' rights generally or by general
equitable principles. Such Underwritten Securities will be in the form
contemplated by, and each registered holder thereof is entitled to the
benefits of, the applicable Indenture.
(xi) AUTHORIZATION OF THE INDENTURE. The Indenture has been,
or prior to the issuance of the Debt Securities thereunder will have
been, duly authorized, executed and delivered by the Company and, upon
such authorization, execution and delivery, will constitute a valid and
legally binding agreement of the Company, enforceable against the
Company in accordance with its terms, except as the enforcement thereof
may be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws relating to or affecting enforcement of creditors'
rights generally or by general equitable principles.
(xii) [Reserved]
(xiii) DESCRIPTION OF THE UNDERWRITTEN SECURITIES AND
INDENTURES. The Underwritten Securities being sold pursuant to the
applicable Terms Agreement and the Indenture, as of the date of the
Prospectus, will conform in all material respects to the statements
relating thereto contained in the Prospectus and will be in
substantially the form filed or incorporated by reference, as the case
may be, as an exhibit to the Registration Statement.
(xiv) ABSENCE OF DEFAULTS AND CONFLICTS. Neither the Company
nor any of its subsidiaries is in violation of its charter or by-laws
or in default in the performance or observance of any obligation,
agreement, covenant or condition contained in any contract, indenture,
mortgage, deed of trust, loan or credit agreement, note, lease or other
agreement or instrument to which the Company or any of its subsidiaries
is a party or by which it or any of them may be bound, or to which any
of the property or assets of the Company or any subsidiary is subject
(collectively, "Agreements and Instruments"), except for such defaults
that would not result in a Material Adverse Effect. The execution,
delivery and performance of this Underwriting Agreement, the applicable
Terms Agreement and the Indenture, and any other agreement or
instrument entered into or issued or to be entered into or issued by
the Company in connection with the transactions contemplated hereby or
thereby or in the Registration Statement and the Prospectus and the
consummation of the transactions contemplated herein and in the
Registration Statement and the Prospectus (including the issuance and
sale of the Underwritten Securities and the use of the proceeds from
the sale of the Underwritten Securities as described under the caption
"Use of Proceeds") and compliance by the Company with its obligations
hereunder and thereunder have been duly authorized by all necessary
corporate action and do not and will not, whether with or without the
giving of notice or passage of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined
below) under, or result in the creation or imposition of any
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lien, charge or encumbrance upon any assets, property or operations of
the Company or any of its subsidiaries pursuant to, any Agreements and
Instruments nor will such action result in any violation of the
provisions of the charter or by-laws of the Company or any of its
subsidiaries or any applicable law, statute, rule, regulation,
judgment, order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over
the Company or any if its subsidiaries or any of their assets,
properties or operations. As used herein, a "Repayment Event" means any
event or condition which gives the holder of any note, debenture or
other evidence of indebtedness (or any person acting on such holder's
behalf) the right to require the repurchase, redemption or repayment of
all or a portion of such indebtedness by the Company or any of its
subsidiaries.
(xv) ABSENCE OF LABOR DISPUTE. No labor dispute with the
employees of the Company or any of its subsidiaries exists or, to the
knowledge of the Company, is imminent, and the Company is not aware of
any existing or imminent labor disturbance by the employees of any of
its or any subsidiary's principal suppliers, manufacturers, customers
or contractors, which, in either case, may reasonably be expected to
result in a Material Adverse Effect.
(xvi) ABSENCE OF PROCEEDINGS. There is not pending or
threatened any action, suit, proceeding, inquiry or investigation
before or brought by any court or governmental agency or body, domestic
or foreign, now pending, or, to the knowledge of the Company
threatened, against or affecting the Company or any of its subsidiaries
which is required to be disclosed in the Registration Statement and the
Prospectus (other than as stated therein), or which might reasonably be
expected to result in a Material Adverse Effect, or which might
reasonably be expected to materially and adversely affect the assets,
properties or operations thereof or the consummation of the
transactions contemplated under this Underwriting Agreement, the
applicable Terms Agreement or the Indenture or the performance by the
Company of its obligations hereunder and thereunder. The aggregate of
all pending legal or governmental proceedings to which the Company or
any of its subsidiaries is a party or of which any of their respective
assets, properties or operations is the subject which are not described
in the Registration Statement and the Prospectus, including ordinary
routine litigation incidental to the business, could not reasonably be
expected to result in a Material Adverse Effect.
(xvii) ACCURACY OF EXHIBITS. There are no contracts or
documents which are required to be described in the Registration
Statement, the Prospectus or the documents incorporated by reference
therein or to be filed as exhibits thereto which have not been so
described and filed as required.
(xviii) ABSENCE OF FURTHER REQUIREMENTS. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or
agency, domestic or foreign, is necessary or required for the
performance by the Company of its obligations under this Underwriting
Agreement or the
8
applicable Terms Agreement or in connection with the transactions
contemplated under this Underwriting Agreement, such Terms Agreement or
any applicable Indenture, except such as have been already obtained or
as may be required under state securities laws.
(xix) POSSESSION OF INTELLECTUAL PROPERTY. The Company and its
subsidiaries own or possess, or can acquire on reasonable terms,
adequate patents, patent rights, licenses, inventions, copyrights,
know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks, trade names or other
intellectual property (collectively, "Intellectual Property") necessary
to carry on the business now operated by them, and neither the Company
nor any of its subsidiaries has received any notice or is otherwise
aware of any infringement of or conflict with asserted rights of others
with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property invalid or
inadequate to protect the interest of the Company or any of its
subsidiaries therein, and which infringement or conflict (if the
subject of any unfavorable decision, ruling or finding) or invalidity
or inadequacy, singly or in the aggregate, would result in a Material
Adverse Effect.
(xx) POSSESSION OF LICENSES AND PERMITS. The Company and its
subsidiaries possess such permits, licenses, approvals, consents and
other authorizations (collectively, "Governmental Licenses") issued by
the appropriate federal, state, local or foreign regulatory agencies or
bodies necessary to conduct the business now operated by them. The
Company and its subsidiaries are in compliance with the terms and
conditions of all such Governmental Licenses, except where the failure
so to comply would not, singly or in the aggregate, result in a
Material Adverse Effect. All of the Governmental Licenses are valid and
in full force and effect, except when the invalidity of such
Governmental Licenses or the failure of such Governmental Licenses to
be in full force and effect would not result in a Material Adverse
Effect. Neither the Company nor any of its subsidiaries has received
any notice of proceedings relating to the revocation or modification of
any such Governmental Licenses which, singly or in the aggregate, if
the subject of an unfavorable decision, ruling or finding, would result
in a Material Adverse Effect.
(xxi) TITLE TO PROPERTY. The Company and its subsidiaries have
good and marketable title to all real property owned by the Company and
its subsidiaries and good title to all other properties owned by them,
in each case, free and clear of all mortgages, pledges, liens, security
interests, claims, restrictions or encumbrances of any kind, except (A)
as otherwise stated in the Registration Statement and the Prospectus or
(B) those which do not, singly or in the aggregate, materially affect
the value of such property and do not interfere with the use made and
proposed to be made of such property by the Company or any of its
subsidiaries. All of the leases and subleases material to the business
of the Company and its subsidiaries considered as one enterprise, and
under which the Company or any of its subsidiaries holds properties
described in the Prospectus, are in full force and effect, and neither
the Company nor any of its subsidiaries has received any notice of any
material claim of any sort that has been
9
asserted by anyone adverse to the rights of the Company or any of its
subsidiaries under any of the leases or subleases mentioned above, or
affecting or questioning the rights of the Company or such subsidiary
to the continued possession of the leased or subleased premises under
any such lease or sublease.
(xxii) COMMODITY EXCHANGE ACT. The Debt Securities, upon
issuance, will be excluded or exempted under, or beyond the purview of,
the Commodity Exchange Act, as amended (the "Commodity Exchange Act"),
and the rules and regulations of the Commodity Futures Trading
Commission under the Commodity Exchange Act.
(xxiii) INVESTMENT COMPANY ACT. The Company is not, and upon
the issuance and sale of the Underwritten Securities as herein
contemplated and the application of the net proceeds therefrom as
described in the Prospectus will not be, an "investment company" within
the meaning of the Investment Company Act of 1940, as amended.
(xxiv) ENVIRONMENTAL LAWS. Except as otherwise stated in the
Registration Statement and the Prospectus and except as would not,
singly or in the aggregate, result in a Material Adverse Effect, (A)
neither the Company nor any of its subsidiaries is in violation of any
federal, state, local or foreign statute, law, rule, regulation,
ordinance, code, policy or rule of common law or any judicial or
administrative interpretation thereof including any judicial or
administrative order, consent, decree or judgment, relating to
pollution or protection of human health, the environment (including,
without limitation, ambient air, surface water, groundwater, land
surface or subsurface strata) or wildlife, including, without
limitation, laws and regulations relating to the release or threatened
release of chemicals, pollutants, contaminants, wastes, toxic
substances, hazardous substances, petroleum or petroleum products
(collectively, "Hazardous Materials") or to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport
or handling of Hazardous Materials (collectively, "Environmental
Laws"), (B) the Company and its subsidiaries have all permits,
authorizations and approvals required under any applicable
Environmental Laws and are each in compliance with their requirements,
(C) there are no pending or threatened administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens,
notices of noncompliance or violation, investigation or proceedings
relating to any Environmental Law against the Company or any of its
subsidiaries and (D) there are no events or circumstances that might
reasonably be expected to form the basis of an order for clean-up or
remediation, or an action, suit or proceeding by any private party or
governmental body or agency, against or affecting the Company or any of
its subsidiaries relating to Hazardous Materials or any Environmental
Laws.
(xxv) REGISTRATION RIGHTS. There are no holders of securities
(debt or equity) of the Company or holders of rights (including,
without limitation, preemptive rights), warrants or options to obtain
securities of the Company, who have the right to request the Company to
register securities held by them under the 1933 Act, other than holders
who have waived or will not have such rights for a specified period to
be agreed upon among
10
the Company and the Underwriters, and have waived their rights with
respect to the inclusion of their securities in the Registration
Statement.
(xxvi) ACCOUNTING CONTROLS. The Company maintains a system of
internal accounting controls sufficient to provide reasonable
assurances that (A) transactions are executed in accordance with
management's general or specific authorization; (B) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain accountability for assets; (C) access to assets is permitted
only in accordance with management's general or specific authorization;
and (D) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is taken
with respect to any differences.
(b) OFFICER'S CERTIFICATES. Any certificate signed by any officer of
the Company or any of its subsidiaries and delivered to any Underwriter or to
counsel for the Underwriters in connection with the offering of the Underwritten
Securities shall be deemed a representation and warranty by the Company to each
Underwriter as to the matters covered thereby on the date of such certificate
and, unless subsequently amended or supplemented, at each Representation Date
subsequent thereto.
SECTION 2. SALE AND DELIVERY TO UNDERWRITERS; CLOSING.
(a) UNDERWRITTEN SECURITIES. The several commitments of the
Underwriters to purchase the Underwritten Securities pursuant to the applicable
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.
(b) OPTION UNDERWRITTEN SECURITIES.
In addition, subject to the terms and conditions herein set forth,
the Company may grant, if so provided in the applicable Terms Agreement, an
option to the Underwriters, severally and not jointly, to purchase up to the
number or aggregate principal amount, as the case may be, of the Option
Underwritten Securities set forth therein at a price per Option Underwritten
Security equal to the price per Initial Underwritten Security. Such option, if
granted, will expire 30 days after the date of such Terms Agreement, and may be
exercised in whole or in part from time to time only for the purpose of covering
over-allotments which may be made in connection with the offering and
distribution of the Initial Underwritten Securities upon notice by the
Representative to the Company setting forth the aggregate principal amount, as
the case may be, of Option Underwritten Securities as to which the several
Underwriters are then exercising the option and the time, date and place of
payment and delivery for such Option Underwritten Securities. Any such time and
date of payment and delivery (each, a "Date of Delivery") shall be determined by
the Representative, but shall not be later than seven full business days after
the exercise of said option, nor in any event prior to the Closing Time, unless
otherwise agreed upon by the Representative and the Company. If the option is
exercised as to all or any portion of the Option Underwritten Securities, each
of the Underwriters, severally and not jointly, will purchase that proportion of
the total number or aggregate principal amount, as the case may be, of Option
Underwritten Securities then being purchased which the number or aggregate
principal amount,
11
as the case may be, of Initial Underwritten Securities each such Underwriter has
severally agreed to purchase as set forth in such Terms Agreement bears to the
aggregate principal amount, as the case may be, of Initial Underwritten
Securities, subject to such adjustments as the Representative in its discretion
shall make to eliminate any sales or purchases of a fractional number or
aggregate principal amount, as the case may be, of Option Underwritten
Securities.
(c) PAYMENT. Payment of the purchase price for, and delivery of
certificates for, the Initial Underwritten Securities shall be made at the
offices of Xxxxxxx Xxxxxxxxx Xxxxxxx & Xxxxxxx, L.L.P. or at such other place as
shall be agreed upon by the Representative and the Company, at 9:00 A.M.
(Eastern time) on the third (fourth, if the pricing occurs after 4:30 P.M.
(Eastern time) on any given day) business day after the date of the applicable
Terms Agreement (unless postponed in accordance with the provisions of Section
10 hereof), or such other time not later than ten business days after such date
as shall be agreed upon by the Representative and the Company (such time and
date of payment and delivery being herein called "Closing Time"). In addition,
in the event that the Underwriters have exercised their option, if any, to
purchase any or all of the Option Underwritten Securities, payment of the
purchase price for, and delivery of such Option Underwritten Securities, shall
be made at the above-mentioned offices, or at such other place as shall be
agreed upon by the Representative and the Company, on the relevant Date of
Delivery as specified in the notice from the Representative to the Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
the Representative for the respective accounts of the Underwriters of the
Underwritten Securities to be purchased by them. It is understood that each
Underwriter has authorized the Representative, for its account, to accept
delivery of, receipt for, and make payment of the purchase price for, the
Underwritten Securities which it has severally agreed to purchase. The
Representative, individually and not as representative of the Underwriters, may
(but shall not be obligated to) make payment of the purchase price for the
Underwritten Securities to be purchased by any Underwriter whose funds have not
been received by the Closing Time or the relevant Date of Delivery, as the case
may be, but such payment shall not relieve such Underwriter from its obligations
hereunder.
(d) DENOMINATIONS; REGISTRATION. The Underwritten Securities shall be
in such denominations and registered in such names as the Representative may
request in writing at least one full business day before the Closing Time or the
relevant Date of Delivery, as the case may be. The Underwritten Securities will
be made available for examination and packaging by the Representative in The
City of New York not later than 9:00 A.M. (Eastern time) on the business day
prior to the Closing Time or the relevant Date of Delivery, as the case may be.
SECTION 3. COVENANTS OF THE COMPANY. The Company covenants with the
Representative and with each Underwriter participating in the offering of
Underwritten Securities, as follows:
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(a) COMPLIANCE WITH SECURITIES REGULATIONS AND COMMISSION REQUESTS. The
Company, subject to Section 3(b), will comply with the requirements of Rule 430A
of the 1933 Act Regulations and/or Rule 434 of the 1933 Act Regulations, if and
as applicable, and will notify the Representative immediately, and confirm the
notice in writing, of (i) the effectiveness of any post-effective amendment to
the Registration Statement or the filing of any supplement or amendment to the
Prospectus, (ii) the receipt of any comments from the Commission, (iii) any
request by the Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus or for additional information, and
(iv) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order preventing or
suspending the use of any preliminary prospectus, or of the suspension of the
qualification of the Underwritten Securities for offering or sale in any
jurisdiction, or of the initiation or threatening of any proceedings for any of
such purposes. The Company will promptly effect the filings necessary pursuant
to Rule 424 and will take such steps as it deems necessary to ascertain promptly
whether Prospectus transmitted for filing under Rule 424 was received for filing
by the Commission and, in the event that it was not, it will promptly file the
Prospectus. The Company will make every reasonable effort to prevent the
issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
(b) FILING OF AMENDMENTS. The Company will give the Representative
notice of its intention to file or prepare any amendment to the Registration
Statement (including any filing under Rule 462(b) of the 1933 Act Regulations),
any Term Sheet or any amendment, supplement or revision to either the prospectus
included in the Registration Statement at the time it became effective or to the
Prospectus, whether pursuant to the 1933 Act, the 1934 Act or otherwise, will
furnish the Representative with copies of any such documents a reasonable amount
of time prior to such proposed filing or use, as the case may be, and will not
file or use any such document to which the Representative or counsel for the
Underwriters shall object.
(c) DELIVERY OF REGISTRATION STATEMENTS. The Company has furnished or
will deliver to the Representative and counsel for the Underwriters, without
charge, signed copies of the Registration Statement as originally filed and of
each amendment thereto (including exhibits filed therewith or incorporated by
reference therein and documents incorporated or deemed to be incorporated by
reference therein) and signed copies of all consents and certificates of
experts, and will also deliver to the Representative, without charge, a
conformed copy of the Registration Statement as originally filed and of each
amendment thereto (without exhibits) for each of the Underwriters. Copies of the
Registration Statement and each amendment thereto furnished to the Underwriters
will be identical to the electronically transmitted copies thereof filed with
the Commission pursuant to XXXXX, except to the extent permitted by Regulation
S-T.
(d) DELIVERY OF PROSPECTUSES. The Company will deliver to each
Underwriter, without charge, as many copies of each preliminary prospectus as
such Underwriter may reasonably request, and the Company hereby consents to the
use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each Underwriter, without charge, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, such
number of copies of the Prospectus as such Underwriter may reasonably request.
The
13
Prospectus and any amendments or supplements thereto furnished to the
Underwriters will be identical to the electronically transmitted copies thereof
filed with the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
(e) CONTINUED COMPLIANCE WITH SECURITIES LAWS. The Company will comply
with the 1933 Act and the 1933 Act Regulations and the 1934 Act and the 1934 Act
Regulations so as to permit the completion of the distribution of the
Underwritten Securities as contemplated in this Underwriting Agreement and the
applicable Terms Agreement and in the Registration Statement and the Prospectus.
If at any time when the Prospectus is required by the 1933 Act or the 1934 Act
to be delivered in connection with sales of the Securities, any event shall
occur or condition shall exist as a result of which it is necessary, in the
opinion of counsel for the Underwriters or for the Company, to amend the
Registration Statement in order that the Registration Statement will not contain
an untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not misleading
or to amend or supplement the Prospectus in order that the Prospectus will not
include an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein not misleading in the light of
the circumstances existing at the time it is delivered to a purchaser, or if it
shall be necessary, in the opinion of such counsel, at any such time to amend
the Registration Statement or amend or supplement the Prospectus in order to
comply with the requirements of the 1933 Act or the 1933 Act Regulations, the
Company will promptly prepare and file with the Commission, subject to Section
3(b), such amendment or supplement as may be necessary to correct such statement
or omission or to make the Registration Statement or the Prospectus comply with
such requirements, and the Company will furnish to the Underwriters, without
charge, such number of copies of such amendment or supplement as the
Underwriters may reasonably request.
(f) BLUE SKY QUALIFICATIONS. The Company will use its best efforts, in
cooperation with the Underwriters, to qualify the Underwritten Securities for
offering and sale under the applicable securities laws of such states and other
jurisdictions (domestic or foreign) as the Representative may designate and to
maintain such qualifications in effect for a period of not less than one year
from the date of the applicable Terms Agreement; PROVIDED, HOWEVER, that the
Company shall not be obligated to file any general consent to service of process
or to qualify as a foreign corporation or as a dealer in securities in any
jurisdiction in which it is not so qualified or to subject itself to taxation in
respect of doing business in any jurisdiction in which it is not otherwise so
subject. In each jurisdiction in which the Underwritten Securities have been so
qualified, the Company will file such statements and reports as may be required
by the laws of such jurisdiction to continue such qualification in effect for a
period of not less than one year from the date of such Terms Agreement.
(g) EARNINGS STATEMENT. The Company will timely file such reports
pursuant to the 1934 Act as are necessary in order to make generally available
to its securityholders as soon as practicable an earnings statement for the
purposes of, and to provide the benefits contemplated by, the last paragraph of
Section 11(a) of the 1933 Act.
14
(h) [Reserved]
(i) USE OF PROCEEDS. The Company will use the net proceeds received by
it from the sale of the Underwritten Securities in the manner specified in the
Prospectus under "Use of Proceeds."
(j) LISTING. The Company will use its best efforts to effect the
listing of the Underwritten Securities, prior to the Closing Time, on any
national securities exchange or quotation system if and as specified in the
applicable Terms Agreement.
(k) RESTRICTION ON SALE OF SECURITIES. Between the date of the
applicable Terms Agreement and the Closing Time or such other date specified in
such Terms Agreement, the Company will not, without the prior written consent of
the Representative, directly or indirectly, issue, sell, offer to sell, grant
any option for the sale of, or otherwise dispose of, the securities specified in
such Terms Agreement.
(l) REPORTING REQUIREMENTS. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, will
file all documents required to be filed with the Commission pursuant to the 1934
Act within the time periods required by the 1934 Act and the 1934 Act
Regulations.
SECTION 4. PAYMENT OF EXPENSES.
(a) EXPENSES. The Company will pay all expenses incident to the
performance of its obligations under this Underwriting Agreement or the
applicable Terms Agreement, including (i) the preparation, printing and filing
of the Registration Statement (including financial statements and exhibits) as
originally filed and of each amendment thereto, (ii) the preparation, printing
and delivery to the Underwriters of this Underwriting Agreement, any Terms
Agreement, any agreement among underwriters, the Indenture and such other
documents as may be required in connection with the offering, purchase, sale,
issuance or delivery of the Underwritten Securities, (iii) the preparation,
issuance and delivery of the Underwritten Securities to the Underwriters,
including any transfer taxes and any stamp or other duties payable upon the
sale, issuance or delivery of the Underwritten Securities to the Underwriters,
(iv) the fees and disbursements of the Company's counsel, accountants and other
advisors or agents (including transfer agents and registrars), as well as the
fees and disbursements of any Trustees and their respective counsel, (v) the
qualification of the Underwritten Securities under state securities laws in
accordance with the provisions of Section 3(f) hereof, including filing fees and
the reasonable fees and disbursements of counsel for the Underwriters in
connection therewith and in connection with the preparation, printing and
delivery of the Blue Sky Survey and any Legal Investment Survey, and any
amendment thereto, (vi) the printing and delivery to the Underwriters of copies
of each preliminary prospectus, any Term Sheet, and the Prospectus and any
amendments or supplements thereto, (vii) the fees charged by nationally
recognized statistical rating organizations for the rating of the Underwritten
Securities, if applicable, (viii) the fees and expenses incurred with respect to
the listing of the Underwritten Securities, if applicable, (ix) the filing fees
incident to, and the reasonable fees and disbursements of counsel to the
Underwriters in connection with, the
15
review, if any, by the National Association of Securities Dealers, Inc. (the
"NASD") of the terms of the sale of the Underwritten Securities and (x) the fees
and expenses of any Underwriter acting in the capacity of a "qualified
independent underwriter" (as defined in the bylaws of the NASD), if applicable.
(b) TERMINATION OF AGREEMENT. If the applicable Terms Agreement is
terminated by the Representative in accordance with the provisions of Section 5
or Section 9(b)(i) hereof, the Company shall reimburse the Underwriters for all
of their out-of-pocket expenses, including the reasonable fees and disbursements
of counsel for the Underwriters.
SECTION 5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of
the Underwriters to purchase and pay for the Underwritten Securities pursuant to
the applicable Terms Agreement are subject to the accuracy of the
representations and warranties of the Company contained in Section 1 hereof or
in certificates of any officer of the Company or any of its subsidiaries
delivered pursuant to the provisions hereof, to the performance by the Company
of its covenants and other obligations hereunder, and to the following further
conditions:
(a) EFFECTIVENESS OF REGISTRATION STATEMENT. The Registration
Statement, including any Rule 462(b) Registration Statement, has become
effective under the 1933 Act and no stop order suspending the effectiveness of
the Registration Statement shall have been issued under the 1933 Act and no
proceedings for that purpose shall have been initiated or be pending or
threatened by the Commission, and any request on the part of the Commission for
additional information shall have been complied with to the reasonable
satisfaction of counsel to the Underwriters. A prospectus containing information
relating to the description of the Underwritten Securities, the specific method
of distribution and similar matters shall have been filed with the Commission in
accordance with Rule 424(b)(1), (2), (3), (4) or (5), as applicable (or any
required post-effective amendment providing such information shall have been
filed and declared effective in accordance with the requirements of Rule 430A),
or, if the Company has elected to rely upon Rule 434 of the 1933 Act
Regulations, a Term Sheet including the Rule 434 Information shall have been
filed with the Commission in accordance with Rule 424(b)(7).
(b) OPINION OF COUNSEL FOR COMPANY. At Closing Time, the Representative
shall have received the favorable opinion, dated as of Closing Time, of Xxxxxxx
Xxxxxxxxx Xxxxxxx & Xxxxxxx, L.L.P., counsel for the Company, in form and
substance satisfactory to counsel for the Underwriters, together with signed or
reproduced copies of such letter for each of the other Underwriters, to the
effect set forth in EXHIBIT B hereto and to such further effect as counsel to
the Underwriters may reasonably request.
(c) OPINION OF COUNSEL FOR UNDERWRITERS. At Closing Time, the
Representative shall have received the favorable opinion, dated as of Closing
Time, of Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx, counsel for the Underwriters,
together with signed or reproduced copies of such letter for each of the other
Underwriters, with respect to the matters set forth in clauses (1), (6), (7),
(8), (9), (10), (11) (solely as to the information in the Prospectus under
"Description of the Notes" and "Description of Capital Stock," if any, or any
caption purporting to describe any such
16
Securities), (17), (18) and the penultimate paragraph of EXHIBIT B hereto. In
giving such opinion, such counsel may rely, as to all matters governed by the
laws of jurisdictions other than the law of the State of New York and the
federal law of the United States, upon the opinions of counsel satisfactory to
the Representative. Such counsel may also state that, insofar as such opinion
involves factual matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company and its subsidiaries and certificates of
public officials.
(d) OFFICERS' CERTIFICATE. At Closing Time, there shall not have been,
since the date of the applicable Terms Agreement or since the respective dates
as of which information is given in the Prospectus, any material adverse change
in the condition, financial or otherwise, or in the earnings, business affairs
or business prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business, and the
Representative shall have received a certificate of the President or a Vice
President of the Company and of the chief financial or chief accounting officer
of the Company, dated as of Closing Time, to the effect that (i) there has been
no such material adverse change, (ii) the representations and warranties in
Section 1 are true and correct with the same force and effect as though
expressly made at and as of the Closing Time, (iii) the Company has complied
with all agreements and satisfied all conditions on its part to be performed or
satisfied at or prior to the Closing Time, and (iv) no stop order suspending the
effectiveness of the Registration Statement has been issued and no proceedings
for that purpose have been instituted or threatened by the Commission.
(e) ACCOUNTANT'S COMFORT LETTER. At the time of the execution of the
applicable Terms Agreement, the Representative shall have received from Price
Waterhouse LLP (and, if necessary, any other independent certified public
accountants of any subsidiary of the Company or of any business acquired by the
Company for which financial statements are, or are required to be, included in
the Registration Statement) a letter dated such date, in form and substance
satisfactory to the Representative, together with signed or reproduced copies of
such letter for each of the other Underwriters, containing statements and
information of the type ordinarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and certain financial
information contained in the Registration Statement and the Prospectus.
(f) BRING-DOWN COMFORT LETTER. At Closing Time, the Representative
shall have received from Price Waterhouse LLP (and, if necessary, any other
independent certified public accountants of any subsidiary of the Company or of
any business acquired by the Company for which financial statements are, or are
required to be, included in the Registration Statement) a letter, dated as of
Closing Time, to the effect that they reaffirm the statements made in the letter
furnished pursuant to subsection (e) of this Section 5, except that the
specified date referred to shall be a date not more than three business days
prior to the Closing Time.
(g) RATINGS. At Closing Time and at any relevant Date of Delivery, the
Underwritten Securities shall have the ratings accorded by any "nationally
recognized statistical rating organization," as defined by the Commission for
purposes of Rule 436(g)(2) of the 1933 Act Regulations, if and as specified in
the applicable Terms Agreement, and the Company shall have delivered to the
Representative a letter, dated as of such date, from each such rating
organization,
17
or other evidence satisfactory to the Representative, confirming that the
Underwritten Securities have such rating. Since the time of execution of such
Terms Agreement, there shall not have occurred a downgrading in the rating
assigned to the Underwritten Securities or any of the Company's other securities
by any such rating organization, and no such rating organization shall have
publicly announced that it has under surveillance or review its rating of the
Underwritten Securities or any of the Company's other securities.
(h) APPROVAL OF LISTING. At Closing Time, the Underwritten Securities
shall have been approved for listing, subject only to official notice of
issuance, if any, as specified in the applicable Terms Agreement.
(i) NO OBJECTION. If the Registration Statement or an offering of
Underwritten Securities has been filed with the NASD for review, the NASD shall
not have raised any objection with respect to the fairness and reasonableness of
the underwriting terms and arrangements.
(j) LOCK-UP ARRANGEMENTS. On the date of the applicable Terms
Agreement, the Representative shall have received, in form and substance
satisfactory to it, each lock-up agreement, if any, specified in such Terms
Agreement as being required to be delivered by the persons listed therein.
(k) OVER-ALLOTMENT OPTION. In the event that the Underwriters are
granted an over-allotment option by the Company in the applicable Terms
Agreement and the Underwriters exercise their option to purchase all or any
portion of the Option Underwritten Securities, the representations and
warranties of the Company contained herein and the statements in any
certificates furnished by the Company or any of its subsidiaries hereunder shall
be true and correct as of each Date of Delivery, and, at the relevant Date of
Delivery, the Representative shall have received:
(i) A certificate, dated such Date of Delivery, of the
President or a Vice President of the Company and the chief financial
officer or chief accounting officer of the Company, confirming that the
certificate delivered at the Closing Time pursuant to Section 5(d)
hereof remains true and correct as of such Date of Delivery.
(ii) The favorable opinion of Xxxxxxx Xxxxxxxxx Xxxxxxx &
Xxxxxxx, L.L.P., counsel for the Company, in form and substance
satisfactory to counsel for the Underwriters, dated such Date of
Delivery, relating to the Option Underwritten Securities and otherwise
to the same effect as the opinion required by Section 5(d) hereof.
(iii) The favorable opinion of Fried, Frank, Harris, Xxxxxxx &
Xxxxxxxx, counsel for the Underwriters, dated such Date of Delivery,
relating to the Opinion Underwritten Securities and otherwise to the
same effect as the opinion required by Section 5(c) hereof.
18
(iv) A letter from Price Waterhouse LLP (and such other
accountants) in form and substance satisfactory to the Representative
and dated such Date of Delivery, substantially in the same form and
substance as the letter furnished to the Representative pursuant to
Section 5(f) hereof, except that the "specified date" on the letter
furnished pursuant to this paragraph shall be a date not more than
three business days prior to such Date of Delivery.
(l) ADDITIONAL DOCUMENTS. At Closing Time and at each Date of Delivery,
counsel for the Underwriters shall have been furnished with such documents and
opinions as they may require for the purpose of enabling them to pass upon the
issuance and sale of the Underwritten Securities as herein contemplated, or in
order to evidence the accuracy of any of the representations or warranties, or
the fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company in connection with the issuance and sale of the
Underwritten Securities as herein contemplated shall be satisfactory in form and
substance to the Representative and counsel for the Underwriters.
(m) TERMINATION OF TERMS AGREEMENT. If any condition specified in this
Section 5 shall not have been fulfilled when and as required to be fulfilled,
the applicable Terms Agreement (or, with respect to the Underwriters' exercise
of any applicable over-allotment option for the purchase of Option Underwritten
Securities on a Date of Delivery after the Closing Time, the obligations of the
Underwriters to purchase the Option Underwritten Securities on such Date of
Delivery) may be terminated by the Representative by notice to the Company at
any time at or prior to the Closing Time (or such Date of Delivery, as
applicable), and such termination shall be without liability of any party to any
other party except as provided in Section 4 and except that Sections 1, 6, 7 and
8 shall survive any such termination and remain in full force and effect.
SECTION 6. INDEMNIFICATION.
(a) INDEMNIFICATION OF UNDERWRITERS. The Company agrees to indemnify
and hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the Rule
430A Information and the Rule 434 Information deemed to be a part
thereof, if applicable, or the omission or alleged omission therefrom
of a material fact required to be stated therein or necessary to make
the statements therein not misleading or arising out of any untrue
statement or alleged untrue statement of a material fact included in
any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto), or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
19
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or of any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission; PROVIDED
that (subject to Section 6(d) below) any such settlement is effected
with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by the
Representative), reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense is not paid under (i) or (ii) above;
PROVIDED, HOWEVER, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through the Representative expressly for use in the Registration
Statement (or any amendment thereto), including the Rule 430A Information and
the Rule 434 Information deemed to be a part thereof, if applicable, or any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(b) INDEMNIFICATION OF COMPANY, DIRECTORS AND OFFICERS Each Underwriter
severally agrees to indemnify and hold harmless the Company, its directors, each
of its officers who signed the Registration Statement, and each person, if any,
who controls the Company within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act against any and all loss, liability, claim, damage
and expense described in the indemnity contained in subsection (a) of this
Section, as incurred, but only with respect to untrue statements or omissions,
or alleged untrue statements or omissions, made in the Registration Statement
(or any amendment thereto), including the Rule 430A Information and the Rule 434
Information deemed to be a part thereof, if applicable, or any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto) in
reliance upon and in conformity with written information furnished to the
Company by such Underwriter through the Representative expressly for use in the
Registration Statement (or any amendment thereto) or such preliminary prospectus
or the Prospectus (or any amendment or supplement thereto).
(c) ACTIONS AGAINST PARTIES; NOTIFICATION. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the
20
case of parties indemnified pursuant to Section 6(a) above, counsel to the
indemnified parties shall be selected by the Representative, and, in the case of
parties indemnified pursuant to Section 6(b) above, counsel to the indemnified
parties shall be selected by the Company. An indemnifying party may participate
at its own expense in the defense of any such action; PROVIDED, HOWEVER, that
counsel to the indemnifying party shall not (except with the consent of the
indemnified party) also be counsel to the indemnified party. In no event shall
the indemnifying parties be liable for fees and expenses of more than one
counsel (in addition to any local counsel) separate from their own counsel for
all indemnified parties in connection with any one action or separate but
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances. No indemnifying party shall, without the
prior written consent of the indemnified parties, settle or compromise or
consent to the entry of any judgment with respect to any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever in respect of which indemnification or
contribution could be sought under this Section 6 or Section 7 hereof (whether
or not the indemnified parties are actual or potential parties thereto), unless
such settlement, compromise or consent (i) includes an unconditional release of
each indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) does not include a statement as to
or an admission of fault, culpability or a failure to act by or on behalf of any
indemnified party.
(d) SETTLEMENT WITHOUT CONSENT IF FAILURE TO REIMBURSE. If at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
SECTION 7. CONTRIBUTION. If the indemnification provided for in Section
6 hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (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
Underwritten Securities pursuant to the applicable Terms Agreement or (ii) if
the allocation provided by clause (i) is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company, on
the one hand, and of the Underwriters, on the other hand, in connection with the
statements or omissions which resulted in such losses, liabilities, claims,
damages or expenses, as well as any other relevant equitable considerations.
21
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
Underwritten Securities pursuant to the applicable Terms Agreement shall be
deemed to be in the same respective proportions as the total net proceeds from
the offering of such Underwritten Securities (before deducting expenses)
received by the Company and the total underwriting discount received by the
Underwriters, in each case as set forth on the cover of the Prospectus, or, if
Rule 434 is used, the corresponding location on the Term Sheet bear to the
aggregate initial public offering price of such Securities as set forth on such
cover.
The relative fault of the Company, on the one hand, and the
Underwriters, on the other hand, shall be determined by reference to, among
other things, whether any such 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 Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 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 which does not take account of the
equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the Underwritten Securities underwritten by it and distributed to
the public were offered to the public exceeds the amount of any damages which
such Underwriter has otherwise been required to pay by reason of any 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 0000 Xxx) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall
have the same rights to contribution as the Company. The Underwriters'
respective obligations to contribute pursuant to this Section 7 are several in
proportion to the number or aggregate
22
principal amount, as the case may be, of Initial Underwritten Securities set
forth opposite their respective names in the applicable Terms Agreement and not
joint.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. All representations, warranties and agreements contained in this
Underwriting Agreement or the applicable Terms Agreement or in certificates of
officers of the Company submitted pursuant hereto or thereto, shall remain
operative and in full force and effect, regardless of any investigation made by
or on behalf of any Underwriter or controlling person, or by or on behalf of the
Company, and shall survive delivery of and payment for the Underwritten
Securities.
SECTION 9. TERMINATION.
(a) UNDERWRITING AGREEMENT. This Underwriting Agreement (excluding the
applicable Terms Agreement) may be terminated for any reason at any time by the
Company or by the Representative upon the giving of 30 days' prior written
notice of such termination to the other party hereto.
(b) TERMINATION; GENERAL. The Representative may terminate the
applicable Terms Agreement, by notice to the Company, at any time at or prior to
the Closing Time or any relevant Date of Delivery, if (i) there has been, since
the time of execution of this Agreement or since the respective dates as of
which information is given in the Prospectus, any material adverse change in the
condition (financial or otherwise), earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business, or (ii) there has
occurred any material adverse change in the financial markets in the United
States or in the international financial markets, any outbreak of hostilities or
escalation thereof or other calamity or crisis or any change or development
involving a prospective change in national or international political, financial
or economic conditions, in each case the effect of which is such as to make it,
in the judgment of the Representative, impracticable to market the Underwritten
Securities or to enforce contracts for the sale of the Underwritten Securities,
or (iii) trading in any securities of the Company has been suspended or limited
by the Commission or any national securities exchange or quotation system on
which the Company's common stock is listed or quoted, or if trading generally on
the New York Stock Exchange or the American Stock Exchange or in the Nasdaq
National Market has been suspended or limited, or minimum or maximum prices for
trading have been fixed, or maximum ranges for prices have been required, by any
of said exchanges or by such system or by order of the Commission, the NASD or
any other governmental authority, or (iv) a banking moratorium has been declared
by either Federal or New York authorities or, if the Underwritten Securities
include Debt Securities denominated or payable in, or indexed to, one or more
foreign or composite currencies, by the relevant authorities in the related
foreign country or countries, or (v) there is any downgrading in the rating
accorded the Underwritten Securities by any "nationally recognized statistical
rating organization" as that term is defined by the Commission for purposes of
Rule 436(g)(2) under the 1933 Act or if any such rating organization shall have
publicly announced that it has placed any of such Underwritten Securities on
what is commonly termed a "watch list" for possible downgrading.
23
(c) LIABILITIES. If this Underwriting Agreement or the applicable Terms
Agreement is terminated pursuant to this Section 9, such termination shall be
without liability of any party to any other party except as provided in Section
4 hereof, and provided further that Sections 1, 6, 7 and 8 shall survive such
termination and remain in full force and effect.
SECTION 10. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS. If one or more
of the Underwriters shall fail at the Closing Time or the relevant Date of
Delivery, as the case may be, to purchase the Underwritten Securities which it
or they are obligated to purchase under the applicable Terms Agreement (the
"Defaulted Securities"), then the Representative shall have the right, within 24
hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms herein set forth; if, however, the Representative shall not have completed
such arrangements within such 24-hour period, then:
(a) if the number or aggregate principal amount, as the case may be, of
Defaulted Securities does not exceed 10% of the number or aggregate
principal amount, as the case may be, of Underwritten Securities to be
purchased on such date pursuant to such Terms Agreement, the
non-defaulting Underwriters shall be obligated, severally and not
jointly, to purchase the full amount thereof in the proportions that
their respective underwriting obligations under such Terms Agreement
bear to the underwriting obligations of all non-defaulting
Underwriters, or
(b) if the number or aggregate principal amount, as the case may be, of
Defaulted Securities exceeds 10% of the number or aggregate principal
amount, as the case may be, of Underwritten Securities to be purchased
on such date pursuant to such Terms Agreement, such Terms Agreement
(or, with respect to the Underwriters' exercise of any applicable
over-allotment option for the purchase of Option Underwritten
Securities on a Date of Delivery after the Closing Time, the
obligations of the Underwriters to purchase, and the Company to sell,
such Option Underwritten Securities on such Date of Delivery) shall
terminate without liability on the part of any non-defaulting
Underwriter.
No action taken pursuant to this Section 10 shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in (i) a
termination of the applicable Terms Agreement or (ii) in the case of a Date of
Delivery after the Closing Time, a termination of the obligations of the
Underwriters and the Company with respect to the related Option Underwritten
Securities, as the case may be, either the Representative or the Company shall
have the right to postpone the Closing Time or the relevant Date of Delivery, as
the case may be, for a period not exceeding seven days in order to effect any
required changes in the Registration Statement or the Prospectus or in any other
documents or arrangements.
SECTION 11. NOTICES. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard
24
form of telecommunication. Notices to the Underwriters shall be directed to the
address of the Representative as set forth in the Terms Agreement; notices to
the Company shall be directed to the Company at 0000 XxXxxxx Xxxx, Xxxxxxxxxx,
Xxxxx Xxxxxxxx 00000-0000, attention of General Counsel.
SECTION 12. PARTIES. This Underwriting Agreement and the applicable
Terms Agreement shall each inure to the benefit of and be binding upon the
Company, the Representative and, upon execution of such Terms Agreement, any
other Underwriters and their respective successors. Nothing expressed or
mentioned in this Underwriting Agreement or such Terms Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
Underwriters and the Company and their respective successors and the controlling
persons and officers and directors referred to in Sections 6 and 7 and their
heirs and legal representatives, any legal or equitable right, remedy or claim
under or in respect of this Underwriting Agreement or such Terms Agreement or
any provision herein or therein contained. This Underwriting Agreement and such
Terms Agreement and all conditions and provisions hereof and thereof are
intended to be for the sole and exclusive benefit of the parties hereto and
thereto 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 Underwritten
Securities from any Underwriter shall be deemed to be a successor by reason
merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS UNDERWRITING AGREEMENT AND ANY
APPLICABLE TERMS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK. SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY
TIME.
SECTION 14. EFFECT OF HEADINGS. The Article and Section headings herein
and the Table of Contents are for convenience only and shall not affect the
construction hereof.
25
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this Underwriting Agreement, along with all counterparts, will become a binding
agreement between the Representative and the Company in accordance with its
terms.
Very truly yours,
OAKWOOD HOMES CORPORATION
By:____________________________
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
[NAME OF REPRESENTATIVE]
By: __________________________________
Authorized Signatory
26
EXHIBIT A
OAKWOOD HOMES CORPORATION
(a North Carolina corporation)
Debt Securities
TERMS AGREEMENT
____________, ____
To: Oakwood Homes Corporation
0000 XxXxxxx Xxxx
Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Ladies and Gentlemen:
We understand that Oakwood Homes Corporation, a North Carolina
corporation (the "Company"), proposes to issue and sell $[__________] aggregate
principal amount of its [senior] [subordinated] debt securities (the "Debt
Securities") (such securities also being hereinafter referred to as the
"[Initial] Underwritten Securities"). Subject to the terms and conditions set
forth or incorporated by reference herein, we [the underwriters named below (the
"Underwriters")] offer to purchase [, severally and not jointly,] the principal
amount of Underwritten Securities [opposite their names set forth below] at the
purchase price set forth below [, and a proportionate share of Option
Underwritten Securities set forth below, to the extent any are purchased].
A-1
Principal Amount
Underwriter of [Initial] Underwritten Securities
----------- ------------------------------------
Total _____________________
[$]
===================
The Underwritten Securities shall have the following terms:
Title:
Rank:
Ratings:
Aggregate principal amount:
Denominations:
Currency of payment:
Interest rate or formula:
Interest payment dates:
Regular record dates:
Stated maturity date:
Redemption provisions:
Sinking fund requirements:
Defeasance provisions:
Listing requirements:
Black-out provisions:
Fixed or Variable Price Offering: [Fixed] [Variable] Price Offering
If Fixed Price Offering: initial public offering price: [__]% of the
principal amount, plus accrued interest, if any, or amortized original
issue discount, if any, from ________________.
Purchase price: ___% of principal amount, plus accrued interest, if
any, or amortized original issue discount, if any, from ____________.
Form:
Other terms and conditions:
Closing date and location:
Additional co-managers, if any:
All of the provisions contained in the document attached as Annex I
hereto entitled "Oakwood Homes Corporation--Debt Securities--Underwriting
Agreement" are hereby incorporated by reference in their entirety herein and
shall be deemed to be a part of this Terms
A-2
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 accept this offer no later than ____ o'clock P.M. (New York City
time) on ________________ by signing a copy of this Terms Agreement in the space
set forth below and returning the signed copy to us.
Very truly yours,
[NAME OF REPRESENTATIVE]
By: _____________________________
Authorized Signatory
[Acting on behalf of itself and the other named
Underwriters.]
Accepted:
OAKWOOD HOMES CORPORATION
By: ____________________________
Name:
Title:
A-3
EXHIBIT B
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
(1) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the state of North Carolina.
(2) The Company has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under, or as
contemplated under, the Underwriting Agreement and the applicable Terms
Agreement.
(3) The Company is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure to so qualify or
be in good standing would not result in a Material Adverse Effect.
(4) Each Subsidiary has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the jurisdiction of its
incorporation, has corporate power and authority to own, lease and operate 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 such qualification is required, whether
by reason of the ownership or leasing of property or the conduct of business,
except where the failure to so qualify or be in good standing would not result
in a Material Adverse Effect. Except as otherwise stated in the Registration
Statement and the Prospectus, all of the issued and outstanding capital stock of
each Subsidiary has been duly authorized and is validly issued, fully paid and
non-assessable and, to the best of our knowledge, is owned by the Company,
directly or through subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity. None of the outstanding
shares of capital stock of any Subsidiary was issued in violation of the
preemptive or similar rights of any securityholder of such Subsidiary.
(5) [Include if the Prospectus contains a "Capitalization" section] The
authorized, issued and outstanding shares of capital stock of the Company is as
set forth in the column entitled "Actual" under the caption "Capitalization"
(except for subsequent issuances thereof, if any, contemplated under the
Underwriting Agreement, pursuant to reservations, agreements or employee benefit
plans referred to in the Prospectus or pursuant to the exercise of convertible
securities or options referred to in the Prospectus). Such shares of capital
stock have been duly authorized and validly issued by the Company and are fully
paid and non-assessable, and none of such shares of capital stock was issued in
violation of preemptive or other similar rights of any securityholder of the
Company.
B-1
(6) The Underwriting Agreement and the applicable Terms Agreement have
been duly authorized, executed and delivered by the Company.
(7) The Underwritten Securities have been duly authorized by the
Company for issuance and sale pursuant to the Underwriting Agreement and the
applicable Terms Agreement. The Underwritten Securities, when issued and
authenticated in the manner provided for in the Indenture and delivered against
payment of the consideration therefor specified in such Terms Agreement, will
constitute valid and legally binding obligations of the Company, enforceable
against the Company in accordance with their terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws relating to or affecting creditors' rights generally or by
general equitable principles. Such Underwritten Securities will be in the form
contemplated by, and each registered holder thereof is entitled to the benefits
of, the Indenture.
(8) The Indenture has been duly authorized, executed and delivered by
the Company and (assuming due authorization, execution and delivery thereof by
the Trustee) constitutes a valid and legally binding agreement of the Company,
enforceable against the Company in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting creditors' rights
generally or by general equitable principles.
(9) [Reserved]
(10) The Underwritten Securities being sold pursuant to the applicable
Terms Agreement conform in all material respects to the statements relating
thereto contained in the Prospectus and are in substantially the form filed or
incorporated by reference, as the case may be, as an exhibit to the Registration
Statement.
(11) The information in the Prospectus under "Description of Debt
Securities" and "Description of Capital Stock," if any, or any caption
purporting to describe any such Securities, and "Certain Federal Income Tax
Considerations," and in the Registration Statement under Item 15, to the extent
that it constitutes matters of law, summaries of legal matters, the Company's
charter and bylaws or legal proceedings, or legal conclusions, has been reviewed
by us and is correct in all material respects.
(12) To the best of our knowledge, neither the Company nor any of its
subsidiaries is in violation of its charter or by-laws and no default by the
Company or any of its subsidiaries exists in the due performance or observance
of any material obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or other agreement or
instrument that is described or referred to in the Registration Statement or the
Prospectus or filed or incorporated by reference as an exhibit to the
Registration Statement.
(13) The execution, delivery and performance of the Underwriting
Agreement, the applicable Terms Agreement and the Indenture and any other
agreement or instrument entered into or issued or to be entered into or issued
by the Company in connection with the transactions contemplated in the
Registration Statement and the Prospectus and the consummation of the
transactions contemplated in the
B-2
Underwriting Agreement and such Terms Agreement and in the Registration
Statement and the Prospectus (including the issuance and sale of the
Underwritten Securities and the use of the proceeds from the sale of the
Underwritten Securities as described under the caption "Use Of Proceeds") and
compliance by the Company with its obligations thereunder do not and will not,
whether with or without the giving of notice or passage of time or both,
conflict with or constitute a breach of, or default or Repayment Event under, or
results in the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any of its subsidiaries pursuant to,
any contract, indenture, mortgage, deed of trust, loan or credit agreement,
note, lease or any other agreement or instrument, known to us, to which the
Company or any of its subsidiaries is a party or by which it or any of them may
be bound, or to which any of the assets, properties or operations of the Company
or any of its subsidiaries is subject, except for such conflicts, breaches,
defaults, events or liens, charges or encumbrances that would not result in a
Material Adverse Effect, nor will such action result in any violation of the
provisions of the charter or by-laws of the Company or any of its subsidiaries
or any applicable law, statute, rule, regulation, judgment, order, writ or
decree, known to us, of any government, government instrumentality or court,
domestic or foreign, having jurisdiction over the Company or any of its
subsidiaries or any of their assets, properties or operations.
(14) To the best of our knowledge, there is not pending or threatened
any action, suit, proceeding, inquiry or investigation to which the Company or
any of its subsidiaries thereof is a party or to which the assets, properties or
operations of the Company or any of its subsidiaries thereof is subject, before
or by any court or governmental agency or body, domestic or foreign, which might
reasonably be expected to result in a Material Adverse Effect or which might
reasonably be expected to materially and adversely affect the assets, properties
or operations thereof or the consummation of the transactions contemplated under
the Underwriting Agreement, the applicable Terms Agreement or the Indenture or
the performance by the Company of its obligations thereunder.
(15) All descriptions in the Registration Statement of contracts and
other documents to which the Company or its subsidiaries are a party are
accurate in all material respects. To the best of our knowledge, there are no
franchises, contracts, indentures, mortgages, loan agreements, notes, leases or
other instruments required to be described or referred to in the Registration
Statement or to be filed as exhibits thereto other than those described or
referred to therein or filed or incorporated by reference as exhibits thereto,
and the descriptions thereof or references thereto are correct in all material
respects.
(16) To the best of our knowledge, there are no statutes or regulations
that are required to be described in the Prospectus that are not described as
required.
(17) The Registration Statement has been declared effective under the
1933 Act. Any required filing of the Prospectus pursuant to Rule 424(b) has been
made in the manner and within the time period required by Rule 424(b). To the
best of our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued under the 1933 Act and no proceedings for
that purpose have been instituted or are pending or threatened by the
Commission.
(18) The Registration Statement and the Prospectus, excluding the
documents incorporated by reference therein, and each amendment or supplement to
the Registration Statement and Prospectus,
B-3
excluding the documents incorporated by reference therein, as of their
respective effective or issue dates (other than the financial statements and
supporting schedules included therein or omitted therefrom, and each Trustee's
Statement of Eligibility on Form T-1 (the "Form T-1s"), as to which we express
no opinion) complied as to form in all material respects with the requirements
of the 1933 Act and the 1933 Act Regulations.
(19) The documents incorporated by reference in the Prospectus (other
than the financial statements and supporting schedules therein or omitted
therefrom, as to which we express no opinion), when they were filed with the
Commission complied as to form in all material respects with the requirements of
the 1934 Act and the rules and regulations of the Commission thereunder.
(20) No filing with, or authorization, approval, consent, license,
order, registration, qualification or decree of, any court or governmental
authority or agency, domestic or foreign, is necessary or required for the
performance by the Company of its obligations under the Underwriting Agreement
or the applicable Terms Agreement or in connection with the transactions
contemplated under the Underwriting Agreement, such Terms Agreement or the
Indenture other than under the 1933 Act, the 1933 Act Regulations, the 1939 Act
and the 1939 Act Regulations, which have been obtained, or as may be required
under state securities or blue sky laws.
(21) The Underwritten Securities, upon issuance, will be excluded or
exempted under, or beyond the purview of, the Commodity Exchange Act, as amended
(the "Commodity Exchange Act"), and the rules and regulations of the Commodity
Futures Trading Commission under the Commodity Exchange Act.
(22) The Company is not an "investment company" within the meaning of
the Investment Company Act of 1940, as amended.
Nothing has come to our attention that would lead us to believe that
the Registration Statement or any post-effective amendment thereto, including
the Rule 430A Information and Rule 434 Information (if applicable) (except for
financial statements and schedules and other financial data included therein or
omitted therefrom and for the Form T-1s, as to which we make no statement), at
the time such Registration Statement or any post-effective amendment thereto
(including the filing of the Company's Annual Report on Form 10-K with the
Commission) became effective or at the date of the applicable Terms Agreement,
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading or that the Prospectus or any amendment or supplement thereto
(except for financial statements and schedules and other financial data included
therein or omitted therefrom, as to which we make no statement), at the time the
Prospectus was issued, at the time any such amended or supplemented prospectus
was issued or at the Closing Time, included or includes an untrue statement of a
material fact or omitted or omits 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.
In rendering such opinion, such counsel may rely as to matters of fact
(but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and
B-4
public officials. Such opinion shall not state that it is to be
governed or qualified by, or that it is otherwise subject to, any treatise,
written policy or other document relating to legal opinions, including, without
limitation, the Legal Opinion Accord of the ABA Section of Business Law (1991).
B-5
ANNEX I
FORM OF ACCOUNTANTS' COMFORT LETTER PURSUANT TO SECTION 5(e)
(i) We are independent public accountants with respect to the
Company within the meaning of the 1933 Act and the applicable published
1933 Act Regulations.
(ii) In our opinion, the audited financial statements and the
related financial statement schedules included or incorporated by
reference in the Registration Statement and the Prospectus comply as to
form in all material respects with the applicable accounting
requirements of the 1933 Act and the published rules and regulations
thereunder.
(iii) On the basis of procedures (but not an examination in
accordance with generally accepted auditing standards) consisting of a
reading of the unaudited interim consolidated financial statements of
the Company for the _____-month periods ended _________, 19___ and
_________, 19___, included in the Registration Statement and the
Prospectus (the "____-month financials"), [a reading of the latest
available unaudited interim consolidated financial statements of the
Company], a reading of the minutes of all meetings of the stockholders
and directors of the Company and its subsidiaries and the and
Committees of the Company's Board of Directors and any subsidiary
committees since _________________, inquiries of certain officials of
the Company and its subsidiaries responsible for financial and
accounting matters, a review of interim financial information in
accordance with standards established by the American Institute of
Certified Public Accountants in Statement on Auditing Standards No. 71,
Interim Financial Information ("SAS 71"), with respect to the
_____-month financials, and such other inquiries and procedures as may
be specified in such letter, nothing came to our attention that caused
us to believe that:
(A) the _____-month financials included in the
Registration Statement and the Prospectus do not comply as
to form in all material respects with the applicable
accounting requirements of the 1933 Act and the 1933 Act
Regulations applicable to unaudited interim financial
statements included in registration statements or any
material modifications should be made to the _____-month
financials included in the Registration Statement and the
Prospectus for them to be in conformity with generally
accepted accounting principles;
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(B) at _________, 19___ and at a specified date not
more than five days(1) prior to the date of the
applicable Terms Agreement, there was any change in the
capital stock of the Company and its subsidiaries or any
decrease in the total assets or stockholders investment
of the Company and its subsidiaries or any increase in
the notes and bonds payable and total liabilities of the
Company and its subsidiaries, in each case as compared
with amounts shown in the latest balance sheet included
in the Registration Statement and the Prospectus, except
in each case for changes, decreases or increases that the
Registration Statement and the Prospectus disclose have
occurred or may occur; or
(C) for the period from _________, 19___ to
_________, 19___ and for the period from _________, 19___
to a specified date not more than five days prior to the
date of the applicable Terms Agreement, there was any
decrease in consolidated total revenues, operating
income, or net income, in each case as compared with the
comparable period in the preceding year, except in each
case for any decreases that the Registration Statement
and the Prospectus discloses have occurred or may occur.
(iv) Based upon the procedures set forth in clause (iii) above
and a reading of the Selected Financial Data included in the
Registration Statement and the Prospectus and a reading of the
financial statements from which such data were derived, nothing came to
our attention that caused us to believe that the Selected Financial
Data included in the Registration Statement and the Prospectus do not
comply as to form in all material respects with the disclosure
requirements of Item 301 of Regulation S-K of the 1933 Act, that the
amounts included in the Selected Financial Data are not in agreement
with the corresponding amounts in the audited consolidated financial
statements for the respective periods or that the financial statements
not included in the Registration Statement and the Prospectus from
which certain of such data were derived are not in conformity with
generally accepted accounting principles.
(v) We have compared the information in the Registration
Statement and the Prospectus under selected captions with the
disclosure requirements of Regulation S-K of the 1933 Act and on the
basis of limited procedures specified herein, nothing came to our
attention that caused us to believe that this information does not
comply as to form in all material respects with the disclosure
requirements of Items 302, 402 and 503(d), respectively, of Regulation
S-K.
______________________________
(1) According to Example A of SAS No. 72, the specified date should be five
calendar days prior to the date of the applicable Terms Agreement.
However, in unusual circumstances, five business days may be used.
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(vi) We are unable to and do not express any opinion on the
Pro Forma Financial Information (the "Pro Forma Statement") included in
the Registration Statement and the Prospectus or on the pro forma
adjustments applied to the historical amounts included in the Pro Forma
Statement; however, for purposes of this letter we have:
(A) read the Pro Forma Statement;
(B) performed an audit of the financial
statements to which the pro forma adjustments were
applied;
(C) made inquiries of certain officials of
the Company who have responsibility for financial and
accounting matters about the basis for their
determination of the pro forma adjustments and
whether the Pro Forma Statement complies as to form
in all material respects with the applicable
accounting requirements of Rule 11-02 of Regulation
S-X; and
(D) proved the arithmetic accuracy of the
application of the pro forma adjustments to the
historical amounts in the Pro Forma Statement; and
on the basis of such procedures and such other inquiries and procedures
as specified herein, nothing came to our attention that caused us to
believe that the Pro Forma Statement included in the Registration
Statement does not comply as to form in all material respects with the
applicable requirements of Rule 11-02 of Regulation S-X or that the pro
forma adjustments have not been properly applied to the historical
amounts in the compilation of those statements.
(vii) In addition to the procedures referred to in clause (ii)
above, we have performed other procedures, not constituting an audit,
with respect to certain amounts, percentages, numerical data and
financial information appearing in the Registration Statement and the
Prospectus, which are specified herein, and have compared certain of
such items with, and have found such items to be in agreement with, the
accounting and financial records of the Company.
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