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EXHIBIT 1.1
WASTE MANAGEMENT, INC.
$600,000,000
7 3/8% SENIOR NOTES DUE 2010
UNDERWRITING AGREEMENT
New York, New York
February 2, 2001
To the Representatives named
in Schedule I hereto of the
Underwriters named in
Schedule II hereto
Ladies and Gentlemen:
Waste Management, Inc., a corporation organized under the laws of
Delaware (the "Company"), proposes to sell to the several underwriters named in
Schedule II hereto (the "Underwriters"), for whom you (the "Representatives")
are acting as representatives, the principal amount of its securities identified
in Schedule I hereto (the "Securities"), to be issued under an indenture (the
"Indenture") dated as of September 30, 1997, between the Company and The Chase
Manhattan Bank, a New York banking corporation (as successor to Texas Commerce
Bank National Association), as trustee (the "Trustee"). To the extent there are
no additional Underwriters listed on Schedule I other than you, the term
Representatives as used herein shall mean you, as Underwriters, and the terms
Representatives and Underwriters shall mean either the singular or plural as the
context requires. Any reference herein to the Registration Statement, the Basic
Prospectus, any Preliminary Final Prospectus or the Final Prospectus shall be
deemed to refer to and include the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 which were filed under the Exchange Act on or
before the Effective Date of the Registration Statement or the issue date of the
Basic Prospectus, any Preliminary Final Prospectus or the Final Prospectus, as
the case may be; and any reference herein to the terms "amend," "amendment" or
"supplement" with respect to the Registration Statement, the Basic Prospectus,
any Preliminary Final Prospectus or the Final Prospectus shall be deemed to
refer to and include the filing of any document under the Exchange Act after the
Effective Date of the Registration Statement or the issue date of the Basic
Prospectus, any Preliminary Final Prospectus or the Final Prospectus, as the
case may be, deemed to be incorporated therein by reference. Certain terms used
herein are defined in Section 17 hereof.
1. Representations and Warranties. The Company represents and warrants
to, and agrees with, each Underwriter as set forth below in this Section 1.
(a) The Company meets the requirements for use of Form S-3
under the Act and has prepared and filed with the Commission a
registration statement (the file number
2
of which is set forth in Schedule I hereto) on Form S-3, including a
related basic prospectus, for registration under the Act of the
offering and sale of the Securities. The Company may have filed one or
more amendments thereto, including a Preliminary Final Prospectus, each
of which has previously been furnished to you. The Company will next
file with the Commission one of the following: (1) after the Effective
Date of such registration statement, a final prospectus supplement
relating to the Securities in accordance with Rules 430A and 424(b),
(2) prior to the Effective Date of such registration statement, an
amendment to such registration statement (including the form of final
prospectus supplement) or (3) a final prospectus in accordance with
Rules 415 and 424(b). In the case of clause (1), the Company has
included in such registration statement, as amended at the Effective
Date, all information (other than Rule 430A Information) required by
the Act and the rules thereunder to be included in such registration
statement and the Final Prospectus. As filed, such final prospectus
supplement or such amendment and form of final prospectus supplement
shall contain all Rule 430A Information, together with all other such
required information, and, except to the extent the Representatives
shall agree in writing to a modification, shall be in all substantive
respects in the form furnished to you prior to the Execution Time or,
to the extent not completed at the Execution Time, shall contain only
such specific additional information and other changes (beyond that
contained in the Basic Prospectus and any Preliminary Final Prospectus)
as the Company has advised you, prior to the Execution Time, will be
included or made therein. The Registration Statement, at the Execution
Time, meets the requirements set forth in Rule 415(a)(1)(x).
(b) On the Effective Date, the Registration Statement did or
will, and when the Final Prospectus is first filed (if required) in
accordance with Rule 424(b) and on the Closing Date (as defined
herein), the Final Prospectus (and any supplement thereto) will, comply
in all material respects with the applicable requirements of the Act,
the Exchange Act and the Trust Indenture Act and the respective rules
thereunder; on the Effective Date and at the Execution Time, the
Registration Statement did not or will not contain any untrue statement
of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein not
misleading; on the Effective Date and on the Closing Date, the
Indenture did or will comply in all material respects with the
applicable requirements of the Trust Indenture Act and the rules
thereunder; and, on the Effective Date, the Final Prospectus, if not
filed pursuant to Rule 424(b), will not, and on the date of any filing
pursuant to Rule 424(b) and on the Closing Date, the Final Prospectus
(together with any supplement thereto) will not, include any untrue
statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
however, that the Company makes no representations or warranties as to
(i) that part of the Registration Statement which shall constitute the
Statement of Eligibility and Qualification (Form T-1) under the Trust
Indenture Act of the Trustee or (ii) the information contained in or
omitted from the Registration Statement or the Final Prospectus (or any
supplement thereto) in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of any Underwriter
through the Representatives specifically for inclusion in the
Registration Statement or the Final Prospectus (or any supplement
thereto).
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(c) The Indenture has been duly authorized, executed and
delivered by the Company and, assuming it was duly executed and
delivered by the Trustee, is a valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms,
except as enforcement thereof may be limited by applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and
similar laws now or hereafter in effect relating to or affecting rights
and remedies of creditors, and to general principles of equity
(regardless of whether enforcement is sought in a proceeding at law or
in equity) and to the discretion of the court before which any
proceeding therefor may be brought, and the Indenture has been duly
qualified under the 1939 Act and conforms to the description thereof in
the Registration Statement and the Final Prospectus.
(d) The Securities have been duly authorized and, when
executed by the Company and authenticated by the Trustee in accordance
with the Indenture and delivered to you against payment therefor in
accordance with the terms hereof, will have been validly issued and
delivered, and will constitute valid and binding obligations of the
Company entitled to the benefits of the Indenture and enforceable
against the Company in accordance with their terms, except as
enforcement thereof may be limited by applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and
similar laws now or hereafter in effect relating to or affecting rights
and remedies of creditors, and to general principles of equity
(regardless of whether enforcement is sought in a proceeding at law or
in equity) and to the discretion of the court before which any
proceeding therefor may be brought, and the Securities will conform to
the description thereof in the Registration Statement and the Final
Prospectus.
(e) The Company is a corporation duly organized and validly
existing in good standing under the laws of the State of Delaware with
full corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Registration
Statement and the Final Prospectus, and is duly registered and
qualified to conduct its business and is in good standing in each
jurisdiction or place where the nature of its properties or the conduct
of its business requires such registration or qualification, except
where the failure so to register or qualify does not have a material
adverse effect on the condition (financial or other), prospects,
earnings, business or properties of the Company and its subsidiaries
taken as a whole, whether or not arising from transactions in the
ordinary course of business (a "Material Adverse Effect").
(f) Each "significant subsidiary" (as such term is defined in
Regulation S-X under the Exchange Act) of the Company is listed on
Exhibit 21.1 to the Annual Report on Form 10-K of the Company for the
year ended December 31, 1999 or is described in the Registration
Statement as having been acquired after December 31, 1999 (the
"Subsidiaries"). Each of the Subsidiaries has been duly organized, is
validly existing and is in good standing in the jurisdiction of its
incorporation, with full corporate power and authority to own, lease
and operate its properties and to conduct its business as described in
the Registration Statement and the Final Prospectus, and is duly
registered and qualified to conduct its business and is in good
standing in each jurisdiction or place where the nature of its
properties or the conduct of its business requires such registration or
qualification, except where the failure so to register or qualify does
not have a Material Adverse Effect.
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(g) All of the issued and outstanding shares of capital stock
of each of the Subsidiaries has been duly authorized and validly issued
and are owned directly or indirectly by the Company. All such shares
are fully paid and nonassessable, and, except as disclosed in the Final
Prospectus, are owned by the Company free and clear of any security
interest, mortgage, pledge, claim, lien, encumbrance or adverse
interest of any nature (each, a "Lien"). Except as disclosed in the
Final Prospectus, there are no outstanding subscriptions, rights,
warrants, options, calls, convertible or exchangeable securities,
commitments of sale, or Liens related to or entitling any person to
purchase or otherwise to acquire any shares of the capital stock of, or
other ownership interests in, any Subsidiary.
(h) This Agreement has been duly and validly authorized,
executed and delivered by the Company.
(i) Except as disclosed in the Final Prospectus, there is no
action, suit or proceeding before or by any court or governmental
agency or body or any arbitrator pending against the Company or any of
its subsidiaries that is required to be disclosed in the Registration
Statement or the Final Prospectus, or which could reasonably be
expected to have a Material Adverse Effect, or materially and adversely
affect the performance of the Company's obligations pursuant to this
Agreement and, to the best of the Company's knowledge, no such
proceedings are contemplated or threatened. No action has been taken
with respect to the Company or any Subsidiary, and no statute, rule or
regulation or order has been enacted, adopted or issued by any
governmental agency and no injunction, restraining order or other order
of any court of competent jurisdiction has been issued with respect to
the Company or any Subsidiary that prevents the issuance of the
Securities or suspends the effectiveness of the Registration Statement,
prevents or suspends the use of any Preliminary Prospectus or the Final
Prospectus or prevents or suspends the sale of the Securities in any of
the jurisdictions that you may have specified pursuant to Section 5(e)
hereof; and every request of the Commission, or any securities
authority or agency of any jurisdiction, for additional information to
be included in the Registration Statement or the Final Prospectus or
otherwise has been complied with in all material respects.
(j) Except as disclosed in the Registration Statement or the
Final Prospectus (or any amendment or supplement thereto), subsequent
to the respective dates as of which such information is given in the
Registration Statement and the Final Prospectus (or any amendment or
supplement thereto), neither the Company nor any of its subsidiaries
has incurred any liability or obligation, direct or contingent, that is
material to the Company and its Subsidiaries taken as a whole, or
entered into any transaction, not in the ordinary course of business,
that is material to the Company and its subsidiaries taken as a whole,
and there has not been any material adverse change, or any development
involving or which may reasonably be expected to involve, a prospective
material adverse change, in the condition (financial or other),
prospects, earnings, business or properties of the Company and its
subsidiaries taken as a whole, whether or not arising from transactions
in the ordinary course of business.
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(k) Except as otherwise set forth in the Final Prospectus or
such as would not have a Material Adverse Effect, each of the Company
and the Subsidiaries has good and marketable title to all property
(real and personal) described in the Final Prospectus as being owned by
it, free and clear of all Liens, except Liens for taxes not yet due and
payable and Liens described in the Registration Statement or the Final
Prospectus or in a document filed as an exhibit to the Registration
Statement. All the property described in the Final Prospectus as being
held under lease by each of the Company and the Subsidiaries is held by
it under valid, subsisting and enforceable leases, except as would not
have a Material Adverse Effect.
(l) Except as would not have a Material Adverse Effect,
neither the Company nor any Subsidiary is in violation or default of
(i) any provision of its charter or bylaws, (ii) the terms of any
indenture, contract, lease, mortgage, deed of trust, note agreement,
loan agreement or other agreement, obligation, condition, covenant or
instrument to which it is a party or bound or to which its property is
subject, or (iii) any statute, law, rule, regulation, judgment, order
or decree of any court, regulatory body, administrative agency,
governmental body, arbitrator or other authority having jurisdiction
over the Company or such Subsidiary or any of its properties, as
applicable.
(m) The Company has not distributed and, prior to the later to
occur of (i) the Closing Date and (ii) completion of the distribution
of the Securities, will not distribute any offering material in
connection with the offering and sale of the Securities other than the
Registration Statement, any Preliminary Final Prospectus, the Final
Prospectus or other materials, if any, permitted by the Act.
(n) Except as would not have a Material Adverse Effect, the
Company and the Subsidiaries own or possess the right to use all
patents, trademarks, trademark registrations, service marks, service
xxxx registrations, trade names, copyrights, licenses, inventions,
trade secrets and rights described in the Final Prospectus as being
owned by them or any of them or necessary for the conduct of their
respective businesses, and the Company is not aware of any claim to the
contrary or any challenge by any other person to the rights of the
Company and the Subsidiaries with respect to the foregoing.
(o) Neither the Company nor any subsidiary is a "holding
company" or a "public utility," as such terms are defined in the 1935
Act.
(p) The Company is not and, after giving effect to the
offering and sale of the Securities and the application of the proceeds
thereof as described in the Prospectus, will not be an "investment
company" as defined in the Investment Company Act of 1940, as amended.
(q) No consent, approval, authorization, filing with or order
of any court or governmental agency or body is required in connection
with the transactions contemplated herein, except such as have been
obtained under the Act and the Trust Indenture Act and such as may be
required under the blue sky laws of any jurisdiction in connection with
the purchase and distribution of the Securities by the Underwriters in
the manner contemplated herein and in the Prospectus.
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(r) Neither the issue and sale of the Securities nor the
consummation of any other of the transactions herein contemplated nor
the fulfillment of the terms hereof will conflict with, result in a
breach or violation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or any of its subsidiaries
pursuant to, (i) the charter or by-laws of the Company or any of its
subsidiaries, (ii) the terms of any indenture, contract, lease,
mortgage, deed of trust, note agreement, loan agreement or other
agreement, obligation, condition, covenant or instrument to which the
Company or any of its subsidiaries is a party or bound or to which its
or their property is subject, except as would not have a Material
Adverse Effect, or (iii) any statute, law, rule, regulation, judgment,
order or decree applicable to the Company or any of its subsidiaries of
any court, regulatory body, administrative agency, governmental body,
arbitrator or other authority having jurisdiction over the Company or
any of its subsidiaries or any of its or their properties.
(s) The consolidated historical financial statements and
schedules of the Company and its consolidated subsidiaries included in
the Final Prospectus and the Registration Statement present fairly in
all material respects the financial condition, results of operations
and cash flows of the Company as of the dates and for the periods
indicated, comply as to form with the applicable accounting
requirements of the Act and have been prepared in conformity with
generally accepted accounting principles applied on a consistent basis
throughout the periods involved (except as otherwise noted therein).
(t) Xxxxxx Xxxxxxxx LLP, who has certified certain financial
statements of the Company and its consolidated subsidiaries and
delivered their report with respect to the audited consolidated
financial statements and schedules included in the Final Prospectus,
are independent public accountants with respect to the Company within
the meaning of the Act and the applicable published rules and
regulations thereunder.
(u) The Company has filed all foreign, federal, state and
local tax returns that are required to be filed or has requested
extensions thereof (except in any case in which the failure so to file
would not have a Material Adverse Effect, except as set forth or
incorporated by reference in the Final Prospectus (exclusive of any
supplement thereto)) and has paid all taxes required to be paid by it
and any other assessment, fine or penalty levied against it, to the
extent that any of the foregoing is due and payable, except for any
such assessment, fine or penalty that is currently being contested in
good faith or as would not have a Material Adverse Effect, except as
set forth or incorporated by reference in the Final Prospectus
(exclusive of any supplement thereto).
(v) No labor problem or dispute with the employees of the
Company or any of its Subsidiaries exists or is threatened or imminent,
and the Company is not aware of any existing or imminent labor
disturbance by the employees of any of its or its Subsidiaries'
principal suppliers, contractors or customers, that could have a
Material Adverse Effect, except as set forth or incorporated by
reference in the Final Prospectus (exclusive of any supplement
thereto).
(w) Except as would not have a Material Adverse Effect; the
Company and each of its Subsidiaries are insured by insurers of
recognized financial responsibility
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against such losses and risks and in such amounts as are prudent and
customary in the businesses in which they are engaged; all policies of
insurance insuring the Company or any of its Subsidiaries or their
respective businesses, assets, employees, officers and directors are in
full force and effect; the Company and its Subsidiaries are in
compliance with the terms of such policies and instruments; and there
are no claims by the Company or any of its Subsidiaries under any such
policy or instrument as to which any insurance company is denying
liability or defending under a reservation of rights clause; neither
the Company nor any such Subsidiary has been refused any insurance
coverage sought or applied for, except in each case as set forth or
incorporated by reference in the Final Prospectus (exclusive of any
supplement thereto). Neither the Company nor any such Subsidiary has
any reason to believe that it will not be able to renew its existing
insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue
its business at a cost that would not have a Material Adverse Effect,
except as set forth or incorporated by reference in the Final
Prospectus (exclusive of any supplement thereto).
(x) No Subsidiary is currently prohibited, directly or
indirectly, from paying any dividends to the Company, from making any
other distribution on such Subsidiary's capital stock, from repaying to
the Company any loans or advances to such Subsidiary from the Company
or from transferring any of such Subsidiary's property or assets to the
Company or any other Subsidiary of the Company, except as described or
incorporated by reference in the Final Prospectus (exclusive of any
supplement thereto).
(y) Except as would not have a Material Adverse Effect, the
Company and its Subsidiaries possess all licenses, certificates,
permits and other authorizations issued by the appropriate federal,
state or foreign regulatory authorities necessary to conduct their
respective businesses, and neither the Company nor any such Subsidiary
has received any notice of proceedings relating to the revocation or
modification of any such certificate, authorization or permit which,
singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would have a Material Adverse Effect, except as set
forth or incorporated by reference in the Final Prospectus (exclusive
of any supplement thereto).
(z) The Company and each of its subsidiaries maintain a system
of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with
management's general or specific authorizations; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain asset accountability; (iii) access to assets is permitted only
in accordance with management's general or specific authorization; and
(iv) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is taken
with respect to any differences.
(aa) The Company has not taken, directly or indirectly, any
action designed to or that would constitute or that might reasonably be
expected to cause or result in stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale
of the Securities.
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(bb) The Company and its subsidiaries are (i) in compliance
with any and all applicable foreign, federal, state and local laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), (ii) have received and are in
compliance with all permits, licenses or other approvals required of
them under applicable Environmental Laws to conduct their respective
businesses and (iii) have not received notice of any actual or
potential liability for the investigation or remediation of any
disposal or release of hazardous or toxic substances or wastes,
pollutants or contaminants, except where such non-compliance with
Environmental Laws, failure to receive required permits, licenses or
other approvals, or liability would not, individually or in the
aggregate, have a Material Adverse Effect, except as set forth or
incorporated by reference in the Final Prospectus (exclusive of any
supplement thereto). The environmental reserves described or
incorporated by reference in the Final Prospectus reflect in accordance
with generally accepted accounting principles the known liabilities and
obligations of the Company and its subsidiaries under Environmental
Laws.
(cc) In the ordinary course of its business, the Company
periodically reviews the effect of Environmental Laws on the business,
operations and properties of the Company and its subsidiaries, in the
course of which it identifies and evaluates associated costs and
liabilities (including, without limitation, any capital or operating
expenditures required for clean-up, closure of properties or compliance
with Environmental Laws, or any permit, license or approval, any
related constraints on operating activities and any potential
liabilities to third parties). On the basis of such review, the Company
has reasonably concluded that such associated costs and liabilities
would not, singly or in the aggregate, have a Material Adverse Effect,
except as set forth or incorporated by reference in the Final
Prospectus (exclusive of any supplement thereto).
(dd) Except as would not have a Material Adverse Effect, each
of the Company and its subsidiaries has fulfilled its obligations, if
any, under the minimum funding standards of Xxxxxxx 000 xx xxx Xxxxxx
Xxxxxx Employee Retirement Income Security Act of 1974 ("ERISA") and
the regulations and published interpretations thereunder with respect
to each "plan" (as defined in Section 3(3) of ERISA and such
regulations and published interpretations) in which employees of the
Company and its Subsidiaries are eligible to participate and each such
plan is in compliance with the presently applicable provisions of ERISA
and such regulations and published interpretations. Except as would not
have a Material Adverse Effect, the Company and its Subsidiaries have
not incurred any unpaid liability to the Pension Benefit Guaranty
Corporation (other than for the payment of premiums in the ordinary
course) or to any such plan under Title IV of ERISA.
(ee) No holders of securities of the Company have rights to
the registration of such securities under the Registration Statement.
Any certificate signed by any officer of the Company and delivered to
the Representatives or counsel for the Underwriters in connection with the
offering of the Securities shall be deemed a representation and warranty by the
Company, as to matters covered thereby, to each Underwriter.
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2. Purchase and Sale. Subject to the terms and conditions and in
reliance upon the representations and warranties herein set forth, the Company
agrees to sell to each Underwriter, and each Underwriter agrees, severally and
not jointly, to purchase from the Company, at the purchase price set forth in
Schedule I hereto the principal amount of the Securities set forth opposite such
Underwriter's name in Schedule II hereto.
3. Delivery and Payment. Delivery of and payment for the Securities
shall be made on the date and at the time specified in Schedule I hereto or at
such time on such later date not more than three Business Days after the
foregoing date as the Representatives shall designate, which date and time may
be postponed by agreement between the Representatives and the Company or as
provided in Section 9 hereof (such date and time of delivery and payment for the
Securities being herein called the "Closing Date"). Delivery of the Securities
shall be made to the Representatives for the respective accounts of the several
Underwriters against payment by the several Underwriters through the
Representatives of the purchase price thereof to or upon the order of the
Company by wire transfer payable in same-day funds to an account specified by
the Company. Delivery of the Securities shall be made through the facilities of
The Depository Trust Company unless the Representatives shall otherwise
instruct.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Securities for sale to the public as set forth
in the Final Prospectus.
5. Agreements. The Company agrees with the several Underwriters that:
(a) The Company will use its best efforts to cause the
Registration Statement, if not effective at the Execution Time, and any
amendment thereof, to become effective. Prior to the termination of the
offering of the Securities, the Company will not file any amendment of
the Registration Statement or supplement (including the Final
Prospectus or any Preliminary Final Prospectus) to the Basic Prospectus
or any Rule 462(b) Registration Statement unless the Company has
furnished you a copy for your review prior to filing and will not file
any such proposed amendment or supplement to which you reasonably
object. Subject to the foregoing sentence, if the Registration
Statement has become or becomes effective pursuant to Rule 430A, or
filing of the Final Prospectus is otherwise required under Rule 424(b),
the Company will cause the Final Prospectus, properly completed, and
any supplement thereto to be filed with the Commission pursuant to the
applicable paragraph of Rule 424(b) within the time period prescribed
and will provide evidence satisfactory to the Representatives of such
timely filing. The Company will promptly advise the Representatives (1)
when the Registration Statement, if not effective at the Execution
Time, shall have become effective, (2) when the Final Prospectus, and
any supplement thereto, shall have been filed (if required) with the
Commission pursuant to Rule 424(b) or when any Rule 462(b) Registration
Statement shall have been filed with the Commission, (3) when, prior to
termination of the offering of the Securities, any amendment to the
Registration Statement shall have been filed or become effective, (4)
of any request by the Commission or its staff for any amendment of the
Registration Statement, or any Rule 462(b) Registration Statement, or
for any supplement to the Final Prospectus or for any additional
information, (5) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the
institution or threatening of any proceeding for that purpose and (6)
of
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the receipt by the Company of any notification with respect to the
suspension of the qualification of the Securities for sale in any
jurisdiction or the institution or threatening of any proceeding for
such purpose. The Company will use its best efforts to prevent the
issuance of any such stop order or the suspension of any such
qualification and, if issued, to obtain as soon as possible the
withdrawal thereof.
(b) If, at any time when a prospectus relating to the
Securities is required to be delivered under the Act, any event occurs
as a result of which the Final Prospectus as then supplemented would
include any untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein in the light of
the circumstances under which they were made not misleading, or if it
shall be necessary to amend the Registration Statement or supplement
the Final Prospectus to comply with the Act or the Exchange Act or the
respective rules thereunder, the Company promptly will (1) notify the
Representatives of such event, (2) prepare and file with the
Commission, subject to the second sentence of paragraph (a) of this
Section 5, an amendment or supplement which will correct such statement
or omission or effect such compliance and (3) supply any supplemented
Final Prospectus to you in such quantities as you may reasonably
request.
(c) As soon as practicable, the Company will make generally
available to its security holders and to the Representatives an
earnings statement or statements of the Company and its Subsidiaries
which will satisfy the provisions of Section 11(a) of the Act and Rule
158 under the Act.
(d) The Company will furnish to the Representatives and
counsel for the Underwriters, without charge, signed or conformed
copies of the Registration Statement (including exhibits thereto) and
to each other Underwriter a copy of the Registration Statement (without
exhibits thereto) and, so long as delivery of a prospectus by an
Underwriter or dealer may be required by the Act, as many copies of
each Preliminary Final Prospectus and the Final Prospectus and any
supplement thereto as the Representatives may reasonably request. The
Company will pay the expenses of printing or other production of all
documents relating to the offering.
(e) The Company will arrange, if necessary, for the
qualification of the Securities for sale under the laws of such
jurisdictions as the Representatives may designate, will maintain such
qualifications in effect so long as required for the distribution of
the Securities and will pay any fee of the National Association of
Securities Dealers, Inc., in connection with its review of the
offering; provided that in no event shall the Company be obligated to
qualify to do business in any jurisdiction where it is not now so
qualified or to take any action that would subject it to tax or service
of process in suits, other than those arising out of the offering or
sale of the Securities, in any jurisdiction where it is not now so
subject.
(f) The Company will not, without the prior written consent of
Xxxxxxx Xxxxx Xxxxxx Inc., offer, sell, contract to sell, pledge, or
otherwise dispose of, (or enter into any transaction which is designed
to, or might reasonably be expected to, result in the disposition
(whether by actual disposition or effective economic disposition due to
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cash settlement or otherwise) by the Company or any affiliate of the
Company or any person in privity with the Company or any affiliate of
the Company) directly or indirectly, including the filing (or
participation in the filing) of a registration statement with the
Commission in respect of, or establish or increase a put equivalent
position or liquidate or decrease a call equivalent position within the
meaning of Section 16 of the Exchange Act, any debt securities
(excluding commercial paper or bank borrowings) issued or guaranteed by
the Company (other than the Securities) or publicly announce an
intention to effect any such transaction, until the Business Day set
forth on Schedule I hereto.
(g) The Company will not take, directly or indirectly, any
action designed to or that would constitute or that might reasonably be
expected to cause or result in, under the Exchange Act or otherwise,
stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Securities.
6. Conditions to the Obligations of the Underwriters. The obligations
of the Underwriters to purchase the Securities shall be subject to the accuracy
of the representations and warranties on the part of the Company contained
herein as of the Execution Time and the Closing Date, to the accuracy of the
statements of the Company made in any certificates pursuant to the provisions
hereof, to the performance by the Company of its obligations hereunder and to
the following additional conditions:
(a) If the Registration Statement has not become effective
prior to the Execution Time, unless the Representatives agree in
writing to a later time, the Registration Statement will become
effective not later than (i) 6:00 p.m., New York City time, on the date
of determination of the public offering price, if such determination
occurred at or prior to 3:00 p.m., New York City time, on such date or
(ii) 9:30 a.m. on the Business Day following the day on which the
public offering price was determined, if such determination occurred
after 3:00 p.m., New York City time, on such date; if filing of the
Final Prospectus, or any supplement thereto, is required pursuant to
Rule 424(b), the Final Prospectus, and any such supplement, will be
filed in the manner and within the time period required by Rule 424(b);
and no stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose
shall have been instituted or threatened.
(b) The Company shall have requested and caused Xxxxx Xxxxx
L.L.P., counsel for the Company, to have furnished to the
Representatives their opinion, dated the Closing Date and addressed to
the Representatives, to the effect that:
(i) the Company is a corporation duly incorporated
and validly existing in good standing under the laws of the
State of Delaware;
(ii) the Company has corporate power and authority to
own, lease and operate its properties and to conduct its
business as described in the Final Prospectus and to execute
and deliver and perform its obligations under this Agreement;
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12
(iii) this Agreement has been duly authorized,
executed and delivered by the Company;
(iv) the Indenture has been duly authorized, executed
and delivered by the Company and (assuming the due
authorization, execution and delivery thereof by the Trustee)
constitutes a valid and 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, fraudulent transfer, reorganization,
moratorium or similar laws affecting enforcement of creditors'
rights and remedies generally and except as enforcement
thereof is subject to general principles of equity (regardless
of whether enforcement is considered in a proceeding in equity
or at law);
(v) the global certificate representing the
Securities is in a form authorized by the Indenture, the
Securities have been duly authorized by the Company and,
assuming the global certificate representing the Securities
has been authenticated by the Trustee in the manner provided
for in the Indenture and delivered against payment of the
consideration therefor specified in this Agreement, the
Securities constitute valid and 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, fraudulent transfer,
reorganization, moratorium or similar laws affecting
enforcement of creditors' rights and remedies generally and
except as enforcement thereof is subject to general principles
of equity (regardless of whether enforcement is considered in
a proceeding in equity or at law), and each registered holder
thereof is entitled to the benefits of the Indenture;
(vi) the Indenture has been duly qualified under the
1939 Act;
(vii) the Securities and the Indenture conform as to
legal matters in all material respects to the descriptions
thereof contained in the Final Prospectus;
(viii) the Registration Statement has been declared
effective under the Act; any required filing of the Final
Prospectus pursuant to Rule 424(b) has been made in the manner
and within the time period required by Rule 424(b); and, to
the best of such counsel's knowledge, no stop order suspending
the effectiveness of the Registration Statement has been
issued and no proceedings for that purpose have been
instituted or are pending or threatened under the Act;
(ix) no authorization, approval, consent or license
of any regulatory body or authority (other than under the Act,
the 1939 Act and the securities or Blue Sky laws of the
various states) and no approval of the stockholders of the
Company is required for the valid authorization, issuance,
sale and delivery of the Securities by the Company, or for the
execution, delivery or performance of the Indenture;
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13
(x) the execution and delivery of the Underwriting
Agreement and the Indenture, the consummation of the
transactions contemplated in the Underwriting Agreement and
compliance with the terms of the Underwriting Agreement and
the Indenture do not and will not conflict with or result in a
breach of any of the terms or provisions of, or constitute a
default under, the charter or by-laws of the Company or its
Subsidiaries, or any indenture, mortgage or other agreement or
instrument to which the Company or its Subsidiaries is a party
or by which they or any of their property is bound which is
filed as an exhibit to the Registration Statement or to any of
the documents incorporated by reference in the Final
Prospectus, or any existing applicable laws, rule, regulation
(excluding any securities or anti-fraud law, rule or
regulation);
(xi) the Company is not an "investment company" or an
entity "controlled" by an "investment company," as such terms
are defined in the 1940 Act; and
(xii) neither the Company nor any subsidiary is a
"holding company" or a "public utility," as such terms are
defined in the 1935 Act.
Such counsel shall state that the Registration Statement and
the Final Prospectus, excluding the documents incorporated by reference
therein and the financial statements and other financial data and
supporting schedules included therein or omitted therefrom and the
Trustee's Statement of Eligibility on Form T-1 (the "Form T-1"), as to
which they express no view, as of their respective effective or issue
dates appear on their face to have been appropriately responsive in all
material respects with the requirements of the Act. In addition, such
counsel shall state that they have participated in conferences with
officers and other representatives of the Company, counsel employed by
the Company, representatives of the independent public accountants of
the Company, representatives of the Underwriters and counsel to the
Underwriters at which the contents of the Registration Statement and
the Final Prospectus were discussed and, although such counsel did not
independently verify such information and is not passing upon and does
not assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement and
the Final Prospectus, on the basis of the foregoing, no facts came to
such counsel's attention that led such counsel to believe that the
Registration Statement (other than the financial statements, the notes
thereto and the auditors' reports thereon and the related schedules and
the other financial and accounting data included or incorporated by
reference therein, or omitted therefrom, and the exhibits thereto, as
to which such counsel need not comment) as of its effective date
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order to
make the statements therein not misleading, or that the Final
Prospectus (other than the financial statements, the notes thereto and
the auditors' reports thereon and the related schedules and the other
financial and accounting data included or incorporated by reference
therein, or omitted therefrom, as to which such counsel need not
comment) as of its issue date or the Closing Date contained or contains
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.
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14
In rendering such opinions, such counsel may rely (A) as to
matters involving the application of laws of any jurisdiction other
than the contract law of the State of New York, the General Corporation
Law of Delaware or the Federal laws of the United States, to the extent
they deem proper and specified in such opinion, upon the opinion of
other counsel of good standing whom they believe to be reliable and who
are satisfactory to counsel for the Underwriters and (B) as to matters
of fact, to the extent they deem proper, on certificates of responsible
officers of the Company and public officials. References to the Final
Prospectus in this paragraph (b) include any supplements thereto at the
Closing Date.
(c) Xxxxxxxx X'Xxxxxx, III, Senior Vice President and General
Counsel of the Company, shall have furnished to the Representatives his
opinion, dated the Closing Date and addressed to the Representatives,
to the effect that:
(i) each of the corporate Subsidiaries organized
under U.S. law is a corporation duly incorporated and validly
existing 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 Final Prospectus, except as would
not have a Material Adverse Effect; except as otherwise
disclosed in the Registration Statement or set forth in the
opinion, all of the issued and outstanding capital stock of
each of the Subsidiaries is validly issued, fully paid and
nonassessable and, to the best of such counsel's knowledge, is
owned by the Company free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity; none of
the outstanding shares of capital stock of the Subsidiaries
was issued in violation of the preemptive or similar rights of
any security holder thereof;
(ii) the documents incorporated by reference in the
Final Prospectus (other than the financial statements, other
financial data and supporting schedules included therein or
omitted therefrom, as to which he need express no opinion, and
except to the extent that any statement therein is modified or
superseded in the Final Prospectus), as of the dates they
became effective or were filed with the Commission, as the
case may be, appear on their face to be appropriately
responsive in all material respects with the requirements of
the Exchange Act;
(iii) except as set forth in the Final Prospectus (or
incorporated by reference therein), such counsel does not know
of any action, suit, proceeding, inquiry or investigation
pending or threatened against the Company or any of its
Subsidiaries, or to which the property of the Company or any
of its Subsidiaries is subject, before or brought by any court
or governmental agency or body, domestic or foreign, in which
there is a reasonable probability of a Material Adverse
Effect;
(iv) such counsel does not know of any statutes or
regulations or any pending or threatened legal or governmental
proceedings required to be described in the Final Prospectus
which are not described as required, nor of any material
contracts or documents of a character required to be described
in the Registration Statement or Final Prospectus or to be
filed or incorporated as exhibits to the
- 14 -
15
Registration Statement which are not described and filed or
incorporated as required;
(v) such counsel does not know of any holders of
securities of the Company that have rights to the registration
of such securities under the Registration Statement; and
(vi) the execution and delivery of the Underwriting
Agreement and the Indenture, the consummation of the
transactions contemplated in the Underwriting Agreement and
compliance with the terms of the Underwriting Agreement and
the Indenture do not and will not conflict with or result in a
breach of any of the terms or provisions of, or constitute a
default under, the charter or by-laws of the Company or its
Subsidiaries, or, to the knowledge of such counsel, any
indenture, mortgage or other agreement or instrument to which
the Company or its Subsidiaries is a party or by which they or
any of their property is bound, or any existing applicable
laws, rule, regulation (excluding any securities or anti-fraud
law, rule or regulation), or, to the knowledge of such
counsel, any judgment, order or decree of any government,
governmental instrumentality or court, domestic or foreign,
having jurisdiction over the Company or its Subsidiaries or
any of their properties, that in any case would have a
Material Adverse Effect.
(d) The Representatives shall have received from Xxxxxx &
Xxxxxx L.L.P., counsel for the Underwriters, such opinion or opinions,
dated the Closing Date and addressed to the Representatives, with
respect to the issuance and sale of the Securities, the Indenture, the
Registration Statement, the Final Prospectus (together with any
supplement thereto) and other related matters as the Representatives
may reasonably require, and the Company shall have furnished to such
counsel such documents as they request for the purpose of enabling them
to pass upon such matters.
(e) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the Chairman of the Board or the
President and the principal financial or accounting officer of the
Company, dated the Closing Date, to the effect that the signers of such
certificate have carefully examined the Registration Statement, the
Final Prospectus, any supplements to the Final Prospectus and this
Agreement and that:
(i) the representations and warranties of the Company
in this Agreement are true and correct on and as of the
Closing Date with the same effect as if made on the Closing
Date and the Company has complied with all the agreements and
satisfied all the conditions on its part to be performed or
satisfied at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of
the Registration Statement has been issued and no proceedings
for that purpose have been instituted or, to the Company's
knowledge, threatened; and
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16
(iii) since the date of the most recent financial
statements included or incorporated by reference in the Final
Prospectus (exclusive of any supplement thereto), there has
been no material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the
Company and its Subsidiaries, taken as a whole, whether or not
arising from transactions in the ordinary course of business,
except as set forth or contemplated in the Final Prospectus
(exclusive of any supplement thereto).
(f) The Company shall have requested and caused Xxxxxx
Xxxxxxxx LLP to have furnished to the Representatives, at the Execution
Time and at the Closing Date, letters (which may refer to letters
previously delivered to one or more of the Representatives), dated
respectively as of the Execution Time and as of the Closing Date, in
form and substance satisfactory to the Representatives, confirming that
they are independent accountants within the meaning of the Act and the
Exchange Act and the respective applicable rules and regulations
adopted by the Commission thereunder and that they have performed a
review of the unaudited interim financial information of the Company
for the nine-month period ended September 30, 2000 and as at September
30, 2000 in accordance with Statement on Auditing Standards No. 71, and
stating in effect, except as provided in Schedule I hereto, that:
(i) in their opinion the audited financial statements
and financial statement schedules included or incorporated by
reference in the Registration Statement and the Final
Prospectus and reported on by them comply as to form in all
material respects with the applicable accounting requirements
of the Act and the Exchange Act and the related rules and
regulations adopted by the Commission;
(ii) on the basis of a reading of the latest
unaudited financial statements made available by the Company
and its subsidiaries; their limited review, in accordance with
standards established under Statement on Auditing Standards
No. 71, of the unaudited interim financial information for the
nine-month period ended September 30, 2000 and as at September
30, 2000; carrying out certain specified procedures (but not
an examination in accordance with generally accepted auditing
standards) which would not necessarily reveal matters of
significance with respect to the comments set forth in such
letter; a reading of the minutes of the meetings of the
stockholders, directors and audit committee of the Company and
the subsidiaries; and inquiries of certain officials of the
Company who have responsibility for financial and accounting
matters of the Company and its subsidiaries as to transactions
and events subsequent to December 31, 1999, nothing came to
their attention which caused them to believe that:
(1) any unaudited financial statements
included or incorporated by reference in the
Registration Statement and the Final Prospectus do
not comply as to form in all material respects with
applicable accounting requirements of the Act and
with the related rules and regulations adopted by the
Commission with respect to financial statements
included or
- 16 -
17
incorporated by reference in quarterly reports on
Form 10-Q under the Exchange Act; and said unaudited
financial statements are not in conformity with
generally accepted accounting principles applied on a
basis substantially consistent with that of the
audited financial statements included or incorporated
by reference in the Registration Statement and the
Final Prospectus;
(2) with respect to the period subsequent to
September 30, 2000, there were any changes, at a
specified date not more than five days prior to the
date of the letter, in the long-term debt of the
Company and its subsidiaries or capital stock of the
Company or decreases in consolidated net current
assets (working capital) or stockholders' equity of
the Company as compared with the amounts shown on the
September 30, 2000 consolidated balance sheet
included or incorporated by reference in the
Registration Statement and the Final Prospectus, or
for the period from October 1, 2000 to December 31,
2000 there were any decreases, as compared with the
corresponding period in the preceding quarter in
consolidated revenues or in net income or earnings
per share of the Company and its subsidiaries, or for
the period from January 1 to such specified date
there was any decrease, as compared with the
corresponding period in the preceding quarter in
consolidated revenues, except in all instances for
changes or decreases set forth in such letter, in
which case the letter shall be accompanied by an
explanation by the Company as to the significance
thereof unless said explanation is not deemed
necessary by the Representatives; or
(3) the information included or incorporated
by reference in the Registration Statement and Final
Prospectus in response to Regulation S-K, Item 301
(Selected Financial Data) and Item 503(d) (Ratio of
Earnings to Fixed Charges) is not in conformity with
the applicable disclosure requirements of Regulation
S-K; and
(iii) they have performed certain other specified
procedures as a result of which they determined that certain
information of an accounting, financial or statistical nature
(which is limited to accounting, financial or statistical
information derived from the general accounting records of the
Company and its subsidiaries) set forth in the Registration
Statement and the Final Prospectus and in Exhibit 12 to the
Registration Statement, the information included or
incorporated by reference in Items 1, 2, 6, 7 and 11 of the
Company's Annual Report on Form 10-K, incorporated by
reference in the Registration Statement and the Final
Prospectus, and the information included in the "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" included or incorporated by reference in the
Company's Quarterly Reports on Form 10-Q, incorporated by
reference in the Registration Statement and the Final
Prospectus, agrees with the accounting records of the Company
and its subsidiaries, excluding any questions of legal
interpretation.
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18
References to the Final Prospectus in this paragraph (f)
include any supplement thereto at the date of the letter.
(g) Subsequent to the Execution Time or, if earlier, the dates
as of which information is given in the Registration Statement
(exclusive of any amendment thereof) and the Final Prospectus
(exclusive of any supplement thereto), there shall not have been (i)
any change or decrease specified in the letter or letters referred to
in paragraph (f) of this Section 6 or (ii) any change, or any
development involving a prospective change, in or affecting the
condition (financial or otherwise), earnings, business or properties of
the Company and its Subsidiaries, taken as a whole, whether or not
arising from transactions in the ordinary course of business, except as
set forth or contemplated in the Final Prospectus (exclusive of any
supplement thereto) the effect of which, in any case referred to in
clause (i) or (ii) above, is, in the sole judgment of the
Representatives, so material and adverse as to make it impractical or
inadvisable to proceed with the offering or delivery of the Securities
as contemplated by the Registration Statement (exclusive of any
amendment thereof) and the Final Prospectus (exclusive of any
supplement thereto).
(h) Subsequent to the Execution Time, there shall not have
been any decrease in the rating of any of the Company's debt securities
by any "nationally recognized statistical rating organization" (as
defined for purposes of Rule 436(g) under the Act) or any notice given
of any intended or potential decrease in any such rating or of a
possible change in any such rating that does not indicate the direction
of the possible change.
(i) Prior to the Closing Date, the Company shall have
furnished to the Representatives such further information, certificates
and documents as the Representatives may reasonably request.
If any of the conditions specified in this Section 6 shall not have
been fulfilled in all material respects when and as provided in this Agreement,
or if any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Representatives and counsel for the Underwriters, this
Agreement and all obligations of the Underwriters hereunder may be canceled at,
or at any time prior to, the Closing Date by the Representatives. Notice of such
cancellation shall be given to the Company in writing or by telephone or
facsimile confirmed in writing.
The documents required to be delivered by this Section 6 shall be
delivered at the office of Xxxxx Xxxxx L.L.P., counsel for the Company, at One
Shell Plaza, 000 Xxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxx 00000, on the Closing Date.
7. Reimbursement of Underwriters' Expenses. If the sale of the
Securities provided for herein is not consummated because any condition to the
obligations of the Underwriters set forth in Section 6 hereof is not satisfied,
because of any termination pursuant to Section 10(i) hereof (other than as a
result of the occurrence of the circumstances in Section 10(ii) hereof) or
because of any refusal, inability or failure on the part of the Company to
perform any agreement herein or comply with any provision hereof other than by
reason of a default by any of the Underwriters, the Company will reimburse the
Underwriters severally through Xxxxxxx Xxxxx Barney Inc. on demand for all
out-of-pocket expenses (including reasonable fees and
- 18 -
19
disbursements of counsel) that shall have been incurred by them in connection
with the proposed purchase and sale of the Securities.
8. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter, the directors, officers, employees
and agents of each Underwriter and each person who controls any Underwriter
within the meaning of either the Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several, to which they or any
of them may become subject under the Act, the Exchange Act or other Federal or
state statutory law or regulation, at common law or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the registration statement for the registration of
the Securities as originally filed or in any amendment thereof, or in the Basic
Prospectus, any Preliminary Final Prospectus or the Final Prospectus, or in any
amendment thereof or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
agrees to reimburse each such indemnified party, as incurred, for any legal or
other expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that the Company will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished to
the Company by or on behalf of any Underwriter through the Representatives
specifically for inclusion therein. This indemnity agreement will be in addition
to any liability which the Company may otherwise have.
(b) Each Underwriter severally and not jointly agrees to
indemnify and hold harmless the Company, each of its directors, each of its
officers who signs the Registration Statement, and each person who controls the
Company within the meaning of either the Act or the Exchange Act, to the same
extent as the foregoing indemnity from the Company to each Underwriter, but only
with reference to written information relating to such Underwriter furnished to
the Company by or on behalf of such Underwriter through the Representatives
specifically for inclusion in the documents referred to in the foregoing
indemnity. This indemnity agreement will be in addition to any liability which
any Underwriter may otherwise have. The Company acknowledges that the statements
set forth in the last paragraph of the cover page regarding delivery of the
Securities and, under the heading "Underwriting" or "Plan of Distribution," (i)
the list of Underwriters and their respective participation in the sale of the
Securities, (ii) the sentences related to concessions and reallowances and (iii)
the paragraph related to stabilization, syndicate covering transactions and
penalty bids in any Preliminary Final Prospectus and the Final Prospectus
constitute the only information furnished in writing by or on behalf of the
several Underwriters for inclusion in any Preliminary Final Prospectus or the
Final Prospectus.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 8, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying party (i)
will not relieve it from liability under paragraph (a) or (b) above unless
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20
and to the extent it did not otherwise learn of such action and such failure
results in the forfeiture by the indemnifying party of substantial rights and
defenses and (ii) will not, in any event, relieve the indemnifying party from
any obligations to any indemnified party other than the indemnification
obligation provided in paragraph (a) or (b) above. The indemnifying party shall
be entitled to appoint counsel of the indemnifying party's choice at the
indemnifying party's expense to represent the indemnified party in any action
for which indemnification is sought (in which case the indemnifying party shall
not thereafter be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth below);
provided, however, that such counsel shall be reasonably satisfactory to the
indemnified party. Notwithstanding the indemnifying party's election to appoint
counsel to represent the indemnified party in an action, the indemnified party
shall have the right to employ separate counsel (including local counsel), and
the indemnifying party shall bear the reasonable fees, costs and expenses of
such separate counsel if (i) the use of counsel chosen by the indemnifying party
to represent the indemnified party would present such counsel with a conflict of
interest, (ii) the actual or potential defendants in, or targets of, any such
action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, (iii) the
indemnifying party shall not have employed counsel reasonably satisfactory to
the indemnified party to represent the indemnified party within a reasonable
time after notice of the institution of such action or (iv) the indemnifying
party shall authorize the indemnified party to employ separate counsel at the
expense of the indemnifying party. An indemnifying party will not, without the
prior written consent of the indemnified parties, settle or compromise or
consent to the entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified parties are
actual or potential parties to such claim or action) unless such settlement,
compromise or consent (i) includes an unconditional release of each indemnified
party from all liability arising out of such claim, action, suit or proceeding
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 an indemnified party. An
indemnifying party shall not be liable under this Section 8 to any indemnified
party regarding any settlement or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
is consented to by such indemnifying party, which consent shall not be
unreasonably withheld.
(d) In the event that the indemnity provided in paragraph (a)
or (b) of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company and the Underwriters severally
agree to contribute to the aggregate losses, claims, damages and liabilities
(including legal or other expenses reasonably incurred in connection with
investigating or defending same) (collectively, "Losses") to which the Company
and one or more of the Underwriters may be subject in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and by the Underwriters on the other from the offering of the Securities;
provided, however, that in no case shall any Underwriter (except as may be
provided in any agreement among underwriters relating to the offering of the
Securities) be responsible for any amount in excess of the underwriting discount
or commission applicable
- 20 -
21
to the Securities purchased by such Underwriter hereunder. If the allocation
provided by the immediately preceding sentence is unavailable for any reason,
the Company and the Underwriters severally shall contribute in such proportion
as is appropriate to reflect not only such relative benefits but also the
relative fault of the Company on the one hand and of the Underwriters on the
other in connection with the statements or omissions which resulted in such
Losses as well as any other relevant equitable considerations. Benefits received
by the Company shall be deemed to be equal to the total net proceeds from the
offering (before deducting expenses) received by it, and benefits received by
the Underwriters shall be deemed to be equal to the total underwriting discounts
and commissions, in each case as set forth on the cover page of the Final
Prospectus. Relative fault shall be determined by reference to, among other
things, whether any untrue or any alleged untrue statement of a material fact or
the omission or alleged omission to state a material fact relates to information
provided by the Company on the one hand or the Underwriters on the other, the
intent of the parties and their relative knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission. The Company
and the Underwriters agree that it would not be just and equitable if
contribution were determined by pro rata allocation or any other method of
allocation which does not take account of the equitable considerations referred
to above. Notwithstanding the provisions of this paragraph (d), no person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations in this paragraph
(d) to contribute are several in proportion to their respective underwriting
obligations and not joint. For purposes of this Section 8, each person who
controls an Underwriter within the meaning of either the Act or the Exchange Act
and each director, officer, employee and agent of an Underwriter shall have the
same rights to contribution as such Underwriter, and each person who controls
the Company within the meaning of either the Act or the Exchange Act, each
officer of the Company who shall have signed the Registration Statement and each
director of the Company shall have the same rights to contribution as the
Company, subject in each case to the applicable terms and conditions of this
paragraph (d).
9. Default by an Underwriter. If any one or more Underwriters shall
fail to purchase and pay for any of the Securities agreed to be purchased by
such Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the principal amount of
Securities set forth opposite their names in Schedule II hereto bears to the
aggregate principal amount of Securities set forth opposite the names of all the
remaining Underwriters) the Securities which the defaulting Underwriter or
Underwriters agreed but failed to purchase; provided, however, that in the event
that the aggregate principal amount of Securities which the defaulting
Underwriter or Underwriters agreed but failed to purchase shall exceed 10% of
the aggregate principal amount of Securities set forth in Schedule II hereto,
the remaining Underwriters shall have the right to purchase all, but shall not
be under any obligation to purchase any, of the Securities, and if such
nondefaulting Underwriters do not purchase all the Securities, this Agreement
will terminate without liability to any nondefaulting Underwriter or the
Company. In the event of a default by any Underwriter as set forth in this
Section 9, the Closing Date shall be postponed for such period, not exceeding
five Business Days, as the Representatives shall determine in order that the
required changes in the Registration Statement and the Final Prospectus or in
any other documents or arrangements may be effected. Nothing contained in
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this Agreement shall relieve any defaulting Underwriter of its liability, if
any, to the Company and any nondefaulting Underwriter for damages occasioned by
its default hereunder.
10. Termination. This Agreement shall be subject to termination in the
absolute discretion of the Representatives, by notice given to the Company prior
to delivery of and payment for the Securities, if at any time prior to such time
(i) trading in the Company's Common Stock shall have been suspended by the
Commission, (ii) trading in securities generally on the New York Stock Exchange
shall have been suspended or limited or minimum prices shall have been
established on such Exchange, (iii) a banking moratorium shall have been
declared either by Federal or New York State authorities or (iv) there shall
have occurred any material change in the financial markets or any outbreak or
escalation of hostilities, declaration by the United States of a national
emergency or war, or other calamity or crisis the effect of which on financial
markets is such as to make it, in the sole judgment of the Representatives,
impractical or inadvisable to proceed with the offering or delivery of the
Securities as contemplated by the Final Prospectus (exclusive of any supplement
thereto).
11. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers and of the Underwriters set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or the Company or any of
the officers, directors, employees, agents or controlling persons referred to in
Section 8 hereof, and will survive delivery of and payment for the Securities.
The provisions of Sections 7 and 8 hereof shall survive the termination or
cancellation of this Agreement.
12. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Representatives, will be mailed,
delivered or telefaxed to the Xxxxxxx Xxxxx Xxxxxx Inc. General Counsel (fax
no.: (000) 000-0000) and confirmed to the General Counsel, Xxxxxxx Xxxxx Barney
Inc., at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: General
Counsel; or, if sent to the Company, will be mailed, delivered or telefaxed to
the Waste Management, Inc. General Counsel (fax no.: 000-000-0000) and confirmed
to it at 1001 Xxxxxx, Suite 4000, attention of the Legal Department.
13. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
officers, directors, employees, agents and controlling persons referred to in
Section 8 hereof, and no other person will have any right or obligation
hereunder.
14. Applicable Law. This Agreement will be governed by and construed in
accordance with the laws of the State of New York applicable to contracts made
and to be performed within the State of New York.
15. Counterparts. This Agreement may be signed in one or more
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same agreement.
16. Headings. The section headings used herein are for convenience only
and shall not affect the construction hereof.
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17. Definitions. The terms which follow, when used in this Agreement,
shall have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations of the Commission promulgated thereunder.
"Basic Prospectus" shall mean the prospectus referred to in
paragraph 1(a) above contained in the Registration Statement at the
Effective Date including any Preliminary Final Prospectus.
"Business Day" shall mean any day other than a Saturday, a
Sunday or a legal holiday or a day on which banking institutions or
trust companies are authorized or obligated by law to close in New York
City or Houston, Texas.
"Commission" shall mean the Securities and Exchange
Commission.
"Effective Date" shall mean each date and time that the
Registration Statement, any post-effective amendment or amendments
thereto and any Rule 462(b) Registration Statement became or become
effective.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission promulgated
thereunder.
"Execution Time" shall mean the date and time that this
Agreement is executed and delivered by the parties hereto.
"Final Prospectus" shall mean the prospectus supplement
relating to the Securities that was first filed pursuant to Rule 424(b)
after the Execution Time, together with the Basic Prospectus.
"1935 Act" shall mean the Public Utility Holding Company Act
of 1935, as amended.
"Preliminary Final Prospectus" shall mean any preliminary
prospectus supplement to the Basic Prospectus which describes the
Securities and the offering thereof and is used prior to filing of the
Final Prospectus, together with the Basic Prospectus.
"Registration Statement" shall mean the registration statement
referred to in paragraph 1(a) above, including exhibits and financial
statements, as amended at the Execution Time (or, if not effective at
the Execution Time, in the form in which it shall become effective)
and, in the event any post-effective amendment thereto or any Rule
462(b) Registration Statement becomes effective prior to the Closing
Date, shall also mean such registration statement as so amended or such
Rule 462(b) Registration Statement, as the case may be. Such term shall
include any Rule 430A Information deemed to be included therein at the
Effective Date as provided by Rule 430A.
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24
"Rule 415," "Rule 424," "Rule 430A" and "Rule 462" refer to
such rules under the Act.
"Rule 430A Information" shall mean information with respect to
the Securities and the offering thereof permitted to be omitted from
the Registration Statement when it becomes effective pursuant to Rule
430A.
"Rule 462(b) Registration Statement" shall mean a registration
statement and any amendments thereto filed pursuant to Rule 462(b)
relating to the offering covered by the registration statement referred
to in Section 1(a) hereof.
"Trust Indenture Act" shall mean the Trust Indenture Act of
1939, as amended and the rules and regulations of the Commission
promulgated thereunder.
18. Consent to Representation. The Company and the Underwriters
acknowledge that Xxxxxx & Xxxxxx L.L.P., which is acting as counsel to the
Underwriters in connection with the offer and sale of the Securities, also acts
as counsel from time to time to the Company and certain of its affiliates in
connection with unrelated matters. The Company and the Underwriters consent to
Xxxxxx & Xxxxxx L.L.P. so acting as counsel to the Underwriters.
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25
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement among the
Company and the several Underwriters.
Very truly yours,
WASTE MANAGEMENT, INC.
By /s/ Xxxxxxxx X'Xxxxxxx, III
-----------------------------------
Name: Xxxxxxxx X'Xxxxxxx, III
Title: Sr. Vice President and
General Counsel
THE FOREGOING AGREEMENT IS HEREBY
CONFIRMED AND ACCEPTED AS OF THE DATE
SPECIFIED IN SCHEDULE I HERETO.
XXXXXXX XXXXX BARNEY INC.
CREDIT SUISSE FIRST BOSTON
CORPORATION
XXXXXXX LYNCH, PIERCE, XXXXXX &
XXXXX INCORPORATED
BANC OF AMERICA SECURITIES LLC
DEUTSCHE BANC ALEX. XXXXX INC.
FLEET SECURITIES, INC.
XXXXXXX, SACHS & CO.
CHASE SECURITIES INC.
XXXXXX BROTHERS INC
BY: XXXXXXX XXXXX BARNEY INC.
By /s/ Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Managing Director
For themselves and the other several Underwriters,
if any, named in Schedule II to the foregoing
Agreement.
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26
SCHEDULE I
Underwriting Agreement dated: February 2, 2001
Registration Statement No.: 333-80063
Representative(s): Xxxxxxx Xxxxx Xxxxxx Inc.
Credit Suisse First Boston Corporation
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Title, Purchase Price and Description of Securities:
Title: 7 3/8% Senior Notes Due 2010
Principal amount: $600,000,000
Purchase price (include accrued
interest or amortization, if
any, from February 9, 2001): 98.943%
Sinking fund provisions: None
Redemption provisions: Make Whole Call + 30bp
Other provisions: As provided in the Indenture
Closing Date, Time and Location: February 9, 2001 at 9:00 a.m. at the offices
of Xxxxx Xxxxx L.L.P., One Shell Plaza, 000 Xxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxx
00000
Type of Offering: Non-delayed
Date referred to in Section 5(f) after which the Company
may offer or sell debt securities issued or guaranteed
by the Company without the consent of the Representative(s): March 4, 2001
Modification of items to be covered by the letter from
Xxxxxx Xxxxxxxx LLP delivered pursuant to
Section 6(f) at the Execution Time: None
27
SCHEDULE II
PRINCIPAL AMOUNT
OF SECURITIES
UNDERWRITERS TO BE PURCHASED
------------ -------------------
Xxxxxxx Xxxxx Barney Inc. .................................................................. $ 160,000,000
Credit Suisse First Boston Corporation ..................................................... 160,000,000
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated ......................................... 160,000,000
Banc of America Securities LLC ............................................................. 20,000,000
Chase Securities Inc. ...................................................................... 20,000,000
Deutsche Banc Alex. Xxxxx Inc. ............................................................. 20,000,000
Fleet Securities, Inc. ..................................................................... 20,000,000
Xxxxxxx, Sachs & Co. ....................................................................... 20,000,000
Xxxxxx Brothers Inc. ....................................................................... 20,000,000
---------------
TOTAL .................................................................... $ 600,000,000
===============
