International Rectifier Corporation
8,000,000 Shares a/
Common Stock
($1.00 par value)
Underwriting Agreement
New York, New York
, 2000
Xxxxxxx Xxxxx Xxxxxx Inc.
X.X. Xxxxxx Securities Inc.
Banc of America Securities LLC
Gruntal & Co., LLC
As Representatives of the several Underwriters,
c/o Xxxxxxx Xxxxx Barney Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
International Rectifier Corporation, a corporation organized under the laws
of Delaware (the "Company"), proposes to sell to the several underwriters named
in Schedule I hereto (the "Underwriters"), for whom you (the "Representatives")
are acting as representatives, 7,600,000 shares of Common Stock, $1.00 par value
("Common Stock") of the Company, and the person named in Schedule II hereto (the
"Selling Stockholder") proposes to sell to the several Underwriters 400,000
shares of Common Stock (said shares to be issued and sold by the Company and
shares to be sold by the Selling Stockholder collectively being hereinafter
called the "Underwritten Securities"). The Company also proposes to grant to the
Underwriters an option to purchase up to 1,200,000 additional shares of Common
Stock to cover over-allotments (the "Option Securities"; the Option Securities,
together with the Underwritten Securities, being hereinafter called the
"Securities"). 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. The use of the neuter in
this Agreement shall include the feminine and masculine wherever appropriate.
Any reference herein to the Registration Statement, a Preliminary Prospectus or
the 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 such Preliminary Prospectus or the Prospectus, as
the case may be; and any reference herein to the terms "amend", "amendment" or
"supplement" with respect to the Registration Statement, any Preliminary
Prospectus or the Prospectus shall be deemed to refer to and include the filing
of any document under the Exchange Act after the Effective Date of the
-------------------
a/ Plus an option to purchase from the Company up to 1,200,000 additional
shares of Common Stock to cover over-allotments.
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Registration Statement, or the issue date of any Preliminary Prospectus or the
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.
(i) 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
(file number 333-30348) on Form S-3, including a related preliminary
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 related preliminary prospectus, each of which has previously
been furnished to you. The Company will next file with the Commission one
of the following: either (1) prior to the Effective Date of such
registration statement, a further amendment to such registration statement
(including the form of final prospectus) or (2) after the Effective Date of
such registration statement, a final prospectus in accordance with Rules
430A and 424(b). In the case of clause (2), 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
Prospectus. As filed, such amendment and form of final prospectus, or such
final prospectus, 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 latest Preliminary Prospectus) as the Company has advised
you, prior to the Execution Time, will be included or made therein.
(b) On the Effective Date, the Registration Statement did or will,
and when the Prospectus is first filed (if required) in accordance with
Rule 424(b) and on the Closing Date (as defined herein) and on any date on
which Option Securities are purchased, if such date is not the Closing Date
(a "settlement date"), the Prospectus (and any supplements thereto) will,
comply in all material respects with the applicable requirements of the Act
and the Exchange 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; and, on the Effective Date, the
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 and any
settlement date, the Prospectus (together with any supplement thereto) will
not, include any untrue statement of a material fact or omit to state a
material fact
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necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; PROVIDED,
HOWEVER, that the Company makes no representations or warranties as to the
information contained in or omitted from the Registration Statement or the
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 Prospectus (or any supplement thereto).
(c) Each of the Company and its subsidiaries has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction in which it is chartered or organized
with full corporate power and authority to own or lease, as the case may
be, and to operate its properties and conduct its business as described in
the Prospectus, and is duly qualified to do business as a foreign
corporation and is in good standing under the laws of each jurisdiction
which requires such qualification (except where the failure to be so
qualified and in good standing, considering all such cases in the
aggregate, are not reasonably likely to result in a material adverse effect
on the condition (financial or other), business, prospects, properties,
stockholders' equity or results of operations of the Company and its
subsidiaries taken as a whole (a "Material Adverse Effect")).
(d) All the outstanding shares of capital stock of each subsidiary
have been duly and validly authorized and issued and are fully paid and
nonassessable, and, except as otherwise set forth in the Prospectus, all
outstanding shares of capital stock of the subsidiaries, other than Xi'an
IR-Peri Company, Ltd., International Rectifier - Weiguang Company, Ltd.
and Zing Technology, Inc., are owned or controlled by the Company either
directly or through wholly owned subsidiaries free and clear of any
perfected security interest or any other security interests, claims, liens
or encumbrances, except as provided in the Credit Agreement, dated as of
July 1, 1999, among the Company, the initial lenders named therein, and
Sanwa Bank California and Banque Nationale de Paris and related
transaction documents (the "Credit Agreement").
(e) The Company's authorized equity capitalization is as set forth in
the Prospectus; the capital stock of the Company conforms in all material
respects to the description thereof contained in the Prospectus; the
outstanding shares of Common Stock (including the Securities being sold
hereunder by the Selling Stockholder) have been duly and validly authorized
and issued and are fully paid and nonassessable; the Securities being sold
hereunder by the Company have been duly and validly authorized, and, when
issued and delivered to and paid for by the Underwriters pursuant to this
Agreement, will be fully paid and nonassessable; the certificates for the
Securities are in valid and sufficient form; the holders of outstanding
shares of capital stock of the Company are not entitled to preemptive or
other rights to subscribe for the Securities; and, except as set forth in
the Prospectus, no options, warrants or other rights to purchase,
agreements or other obligations to issue, or rights to convert any
obligations into or exchange any securities for, shares of capital stock of
or ownership interests in the Company are outstanding, as of the dates or
dates noted therein.
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(f) There is no franchise, contract or other document of a character
required to be filed as an exhibit to the Registration Statement which is
not filed as required.
(g) This Agreement has been duly authorized, executed and delivered
by the Company.
(h) 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.
(i) 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 such as may be required under the securities or 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.
(j) 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 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, 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.
(k) No holders of securities of the Company have rights to the
registration of such securities under the Registration Statement.
(l) The consolidated historical financial statements and schedules of
the Company and its consolidated subsidiaries included in the 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).
(m) No action, suit or proceeding by or before any court or
governmental
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agency, authority or body or any arbitrator involving the Company or any of
its subsidiaries or its or their property is pending or, to the best
knowledge of the Company, threatened that (i) could reasonably be expected
to have a Material Adverse Effect on the performance of this Agreement or
the consummation of any of the transactions contemplated hereby or (ii)
could reasonably be expected to have a Material Adverse Effect, whether or
not arising from transactions in the ordinary course of business, except as
set forth in or contemplated in the Prospectus (exclusive of any supplement
thereto).
(n) Each of the Company and each of its subsidiaries owns or leases
all such properties as are necessary to the conduct of its operations as
presently conducted.
(o) 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, in each case except
where such violation or breach, individually or in the aggregate, would not
have a Material Adverse Effect.
(p) PricewaterhouseCoopers LLP, who have 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 or incorporated by reference in the Prospectus, are
independent public accountants with respect to the Company within the
meaning of the Act and the applicable published rules and regulations
thereunder.
(q) There are no transfer taxes or other similar fees or charges
under Federal law or the laws of California, New York or Delaware, or any
political subdivision thereof, required to be paid in connection with the
execution and delivery of this Agreement or the issuance by the Company or
sale by the Company of the Securities.
(r) 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, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated in the
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,
whether
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or not arising from transactions in the ordinary course of business, except
as set forth in or contemplated in the Prospectus (exclusive of any
supplement thereto).
(s) 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, in each case that could have a Material Adverse
Effect, whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Prospectus
(exclusive of any supplement thereto).
(t) The Company and each of its subsidiaries carry, or are covered
by, insurance in such amounts and covering such risks as is adequate for
the conduct of their respective businesses and the value of their
respective properties and as is customary for companies engaged in similar
businesses in similar industries.
(u) No subsidiary of the Company 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 in or contemplated
by the Prospectus, as provided in the Credit Agreement or as limited
by applicable corporate law.
(v) 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, whether or not arising from
transactions in the ordinary course of business, except as set forth in or
contemplated in the Prospectus (exclusive of any supplement thereto).
(w) 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.
(x) The Company has not taken, directly or indirectly, any action
that has
7
constituted or that was designed to or might reasonably be expected to
cause or result in, under the Exchange Act or otherwise, the stabilization
or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Securities.
(y) 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, whether or not arising
from transactions in the ordinary course of business, except as set forth
in or contemplated in the Prospectus (exclusive of any supplement thereto).
Except as set forth in the Prospectus, to the Company's best knowledge,
neither the Company nor any of the subsidiaries is named as a "potentially
responsible party" under the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended.
(z) 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 in all material respects with the presently applicable
provisions of ERISA and such regulations and published interpretations. 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.
(aa) The Company has no subsidiaries that are significant subsidiaries
defined by Rule 1-02 of Regulation S-X, other than International
Rectifier Southeast Asia Plc., Ltd. and International Rectifier Company
(Great Britain ) Ltd.
(bb) The Company and its subsidiaries own, possess, license or have
other rights to use, on reasonable terms, all patents, patent applications,
trade and service marks, trade and service xxxx registrations, trade names,
copyrights, licenses, inventions, trade secrets, technology, know-how and
other intellectual property (collectively, the "Intellectual Property")
necessary for the conduct of the Company's business as now conducted or as
proposed in the Prospectus to be
8
conducted. Except as set forth in the Prospectus, to the Company's best
knowledge: there is no pending or threatened action, suit, proceeding or
claim by others challenging the Company's rights in or to any such
Intellectual Property; there is no pending or threatened action, suit,
proceeding or claim by others challenging the validity or scope of any such
Intellectual Property; there is no pending or threatened action, suit,
proceeding or claim by others that the Company infringes or otherwise
violates any patent, trademark, copyright, trade secret or other
proprietary rights of others; there is no U.S. patent or published U.S.
patent application which contains claims that dominate or may dominate any
Intellectual Property described in the Prospectus as being owned by or
licensed to the Company or that interferes with the issued or pending
claims of any such Intellectual Property; and there is no prior art that
may render any U.S. patent held by the Company invalid or any U.S. patent
application held by the Company unpatentable which has not been disclosed
to the U.S. Patent and Trademark Office; in each case that, individually or
in the aggregate, would have a Material Adverse Effect.
(cc) The statements contained in the Prospectus under the captions
"Risk Factors Our intellectual property is one of our principal assets.
Protecting this asset may be costly and uncertain." and "Business -
Intellectual Property," insofar as such statements summarize legal matters,
agreements, documents, or proceedings discussed therein, are accurate and
fair summaries of such legal matters, agreements, documents or proceedings.
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.
(ii) the Selling Stockholder represents and warrants to, and agrees
with, each Underwriter that:
(a) The Selling Stockholder is the record and beneficial owner of the
Securities to be sold by it hereunder free and clear of all liens,
encumbrances, equities and claims and has duly endorsed such Securities in
blank, and, assuming that each Underwriter acquires its interest in the
Securities it has purchased from the Selling Stockholder without notice of
any adverse claim (within the meaning of Section 8-105 of the New York
Uniform Commercial Code ("UCC")), each Underwriter that has purchased such
Securities delivered on the Closing Date to The Depository Trust Company or
other securities intermediary by making payment therefor as provided
herein, and that has had such Securities credited to the securities account
or accounts of such Underwriters maintained with The Depository Trust
Company or such other securities intermediary will have acquired such
Securities free and clear of any adverse claim (within the meaning of
Section 8-105 of the UCC).
9
(b) The Selling Stockholder has not taken, directly or indirectly,
any action designed to or which has constituted or which might reasonably
be expected to cause or result, under the Exchange Act or otherwise, in
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Securities.
(c) Certificates in negotiable form for the Selling Stockholder's
Securities have been placed in custody, for delivery pursuant to the terms
of this Agreement, under a Custody Agreement and Power of Attorney duly
executed and delivered by the Selling Stockholder, in the form heretofore
furnished to you (the "Custody Agreement") with the Company, as Custodian
(the "Custodian"); and the Securities represented by the certificates so
held in custody for the Selling Stockholder are subject to the interests
hereunder of the Underwriters.
(d) No consent, approval, authorization or order of any court or
governmental agency or body is required for the consummation by the Selling
Stockholder of the transactions contemplated herein, except such as may
have been obtained under the Act and such as may be required under the
securities or blue sky laws of any jurisdiction in connection with the
purchase and distribution of the Securities by the Underwriters and such
other approvals as have been obtained.
(e) Neither the sale of the Securities being sold by the Selling
Stockholder nor the consummation of any other of the transactions herein
contemplated by the Selling Stockholder or the fulfillment of the terms
hereof by the Selling Stockholder will result in a breach or violation of,
or constitute a default under any law or the terms of any indenture or
other agreement or instrument to which the Selling Stockholder is a party
or bound, or any judgment, order or decree applicable to the Selling
Stockholder of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over the Selling
Stockholder.
(f) The Selling Stockholder has no reason to believe that the
representations and warranties of the Company contained in this Section 1
are not true and correct, is familiar with the Registration Statement and
has no knowledge of any material fact, condition or information not
disclosed in the Prospectus or any supplement thereto which has adversely
affected or is reasonably expected to adversely affect the business of the
Company or any of its subsidiaries; and the sale of Securities by the
Selling Stockholder pursuant hereto is not prompted by any information
concerning the Company or any of its subsidiaries which is not set forth in
the Prospectus or any supplement thereto.
Any certificate signed by the Selling Stockholder 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 Selling Stockholder, as to matters covered thereby, to each
Underwriter.
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2. PURCHASE AND SALE. (a) Subject to the terms and conditions and in
reliance upon the representations and warranties herein set forth, the
Company and the Selling Stockholder agree, severally and not jointly, to
sell to each Underwriter, and each Underwriter agrees, severally and not
jointly, to purchase from the Company and the Selling Stockholder, at a
purchase price of $ per share, the amount of the Underwritten
Securities set forth opposite such Underwriter's name in Schedule I
hereto.
(b) Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Company hereby grants
an option to the several Underwriters to purchase, severally and not
jointly, up to 1,200,000 Option Securities at the same purchase price per
share as the Underwriters shall pay for the Underwritten Securities. Said
option may be exercised only to cover over-allotments in the sale of the
Underwritten Securities by the Underwriters. Said option may be exercised
in whole or in part at any time (but not more than once) on or before the
30th day after the date of the Prospectus upon written or telegraphic
notice by the Representatives to the Company setting forth the number of
shares of the Option Securities as to which the several Underwriters are
exercising the option and the settlement date. The number of Option
Securities to be purchased by each Underwriter shall be the same percentage
of the total number of shares of the Option Securities to be purchased by
the several Underwriters as such Underwriter is purchasing of the
Underwritten Securities, subject to such adjustments as you in your
absolute discretion shall make to eliminate any fractional shares.
3. DELIVERY AND PAYMENT. Delivery of and payment for the
Underwritten Securities and the Option Securities (if the option provided
for in Section 2(b) hereof shall have been exercised on or before the
third Business Day prior to the Closing Date) shall be made at 10:00 AM,
New York City time, on , 2000, 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 among the Representatives, the Company and the Selling
Stockholder 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 respective
aggregate purchase prices of the Securities being sold by the Company and
the Selling Stockholder to or upon the order of the Company and the
Selling Stockholder by wire transfer payable in same-day funds to the
accounts specified by the Company and the Selling Stockholder. Delivery
of the Underwritten Securities and the Option Securities shall be made
through the facilities of The Depository Trust Company unless the
Representatives shall otherwise instruct.
The Selling Stockholder will pay all applicable state transfer
taxes, if any, involved in the transfer to the several Underwriters of the
Securities to be purchased by them from the Selling Stockholder and the
respective Underwriters will pay any additional stock transfer taxes
involved in further transfers.
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If the option provided for in Section 2(b) hereof is exercised after
the third Business Day prior to the Closing Date, the Company will deliver
the Option Securities (at the expense of the Company) to the
Representatives, through the facilities of The Depositary Trust Company
unless the Representatives shall otherwise instruct, on the date specified
by the Representatives (which shall be on the third Business Day after
exercise of said option) 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 the accounts
specified by the Company. If settlement for the Option Securities occurs
after the Closing Date, the Company will deliver to the Representatives on
the settlement date for the Option Securities, and the obligation of the
Underwriters to purchase the Option Securities shall be conditioned upon
receipt of, supplemental opinions, certificates and letters confirming as
of such date the opinions, certificates and letters delivered on the
Closing Date pursuant to Section 6 hereof.
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 Prospectus.
5. AGREEMENTS.
(i) The Company agrees with the several Underwriters that:
(a) The Company will use its reasonable 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 to the 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 Prospectus is otherwise required
under Rule 424(b), the Company will cause the 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 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 Prospectus or for any additional
12
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
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 reasonable 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 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 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
(i)(a) of this Section 5, an amendment or supplement which will correct
such statement or omission or effect such compliance and (3) supply any
supplemented 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, one signed copy 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 Prospectus and the 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
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.
13
(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 cash settlement
or otherwise) by 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 other shares of Common Stock
or any securities convertible into, or exercisable, or exchangeable for,
shares of Common Stock; or publicly announce an intention to effect any
such transaction, for a period of 90 days after the date of the
Underwriting Agreement, provided, however, that the Company may grant
options and issue and sell Common Stock pursuant to any employee stock
option plan, stock ownership plan or dividend reinvestment plan of the
Company in effect at the Execution Time and the Company may issue Common
Stock issuable upon the conversion of securities or the exercise of
warrants outstanding at the Execution Time.
(g) The Company will not take, directly or indirectly, any action
designed to or which has constituted or which might reasonably be expected
to cause or result, under the Exchange Act or otherwise, in stabilization
or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Securities.
(ii) The Selling Stockholder agrees with the several Underwriters
that:
(a) The Selling Stockholder will not, without the prior written
consent of Xxxxxxx Xxxxx Xxxxxx, offer, sell, contract to sell, pledge or
otherwise dispose of, (or enter into any transaction which is designed to,
or might reasonably be expected to, result in the disposition (whether by
actual disposition or effective economic disposition due to cash settlement
or otherwise)), directly or indirectly, or participate 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
with respect to, any shares of capital stock of the Company or any
securities convertible into or exercisable or exchangeable for such capital
stock, or publicly announce an intention to effect any such transaction,
for a period of 90 days after the date of this Agreement, other than shares
of Common Stock disposed of as bona fide gifts approved by Xxxxxxx Xxxxx
Barney Inc..
(b) The Selling Stockholder will not take any action designed to or
which has constituted or which might reasonably be expected to cause or
result, under the Exchange Act or otherwise, in stabilization or
manipulation of the price of any security of the Company to facilitate the
sale or resale of the Securities.
(c) The Selling Stockholder will advise you promptly, and if
requested by
14
you, will confirm such advice in writing, so long as delivery of a
prospectus relating to the Securities by an underwriter or dealer may be
required under the Act, of any change in information in the Registration
Statement or the Prospectus relating to the Selling Stockholder.
6. CONDITIONS TO THE OBLIGATIONS OF THE UNDERWRITERS. The
obligations of the Underwriters to purchase the Underwritten Securities and the
Option Securities, as the case may be, shall be subject to the accuracy of the
representations and warranties on the part of the Company and the Selling
Stockholder contained herein as of the Execution Time, the Closing Date and any
settlement date pursuant to Section 3 hereof, to the accuracy of the statements
of the Company and the Selling Stockholder made in any certificates pursuant to
the provisions hereof, to the performance by the Company and the Selling
Stockholder of their respective 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 PM New York City time on the date of determination of the public
offering price, if such determination occurred at or prior to 3:00 PM New
York City time on such date or (ii) 9:30 AM on the Business Day following
the day on which the public offering price was determined, if such
determination occurred after 3:00 PM New York City time on such date; if
filing of the Prospectus, or any supplement thereto, is required pursuant
to Rule 424(b), the 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 O'Melveny & Xxxxx LLP,
counsel for the Company, shall have furnished to the Representatives their
opinion, dated the Closing Date and addressed to the Representatives, to
the effect that:
(i) the authorized capital stock of the Company is as set forth
in the Prospectus; the Securities being sold by the Company have been
duly authorized by all necessary corporate action on the part of the
Company, and upon payment for and delivery of such Securities in
accordance with this Agreement and the book-entry of such Securities
by the transfer agent for the Company's Common Stock in the name of
The Depository Trust Company or its nominee, such Securities will be
validly issued, fully paid and non-assessable; no personal liability
for the debts of the Company will be imposed on any holder of such
Securities under the laws of the State of Delaware or the State of
California solely as a result of the ownership of such Securities; and
the holders of the capital stock of the Company are not entitled to
any preemptive rights to subscribe to any additional shares
15
of the Company's capital stock under the Company's Certificate of
Incorporation or Bylaws or the corporate law of the State of Delaware;
(ii) except for matters described in the Prospectus, such counsel
has not, since January 1, 1999, given substantive attention on behalf
of the Company or any of its subsidiaries to, or represented the
Company or any of its subsidiaries in connection with, any actions,
suits or proceedings pending or threatened against the Company or any
of its subsidiaries before any court, arbitrator or governmental
agency which seek to affect the enforceability of this Agreement or
seek damages in excess of $50,000;
(iii) such counsel does not know of any contract or other
document of a character required to be filed as an exhibit to the
Registration Statement which is not filed as required;
(iv) the Registration Statement has been declared effective under
the Act and, to such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued or
threatened by the Commission, and the Prospectus has been filed
pursuant to Rule 424(b) within the time period required by Rule
424(b);
(v) the Registration Statement, on the date it was filed,
appeared on its face to comply in all material respects with the
requirements as to form for registration statements on Form S-3 under
the Act and the related rules and regulations in effect at the date of
filing, except that such counsel need express no opinion concerning
the financial statements and other financial information contained or
incorporated by reference therein;
(vi) the documents incorporated by reference in the Prospectus,
on the respective dates they were filed, appeared on their face to
comply in all material respects with the requirements as to form for
reports on Form 10-K, Form 10-Q and Form 8-K, as the case may be,
under the Exchange Act and the related rules and regulations in effect
at the respective dates of their filing, except that such counsel need
express no opinion concerning the financial statements and other
financial information contained or incorporated by reference therein;
(vii) this Agreement has been duly authorized by all necessary
corporate action on the part of the Company and has been duly executed
and delivered by the Company;
(viii) the Company is not and, after giving effect to the sale of
the Securities and the application of the net proceeds thereof as
described in the Prospectus, will not be an investment company
required to register under the Investment Company Act of 1940, as
amended;
16
(ix) no order, consent, permit or approval of any California, New
York or federal governmental authority is required on the part of the
Company for the execution and delivery of this Agreement or for the
issuance and sale of the Securities to be sold by the Company, except
such as have been obtained under the Act and such as may be required
under the securities or blue sky laws of any other jurisdiction;
(x) neither the sale of the Securities being sold by the Company
under this Agreement nor the consummation of the other transactions
herein contemplated by the Company will (i) violate the Company's
Certificate of Incorporation or Bylaws, (ii) violate, breach or result
in a default under any existing obligation of or restriction on the
Company under any indenture or other agreement material to the Company
and identified in an Officer's Certificate, a copy of which shall be
delivered to you, (iii) breach or otherwise violate any existing
obligation of or restriction on the Company under any order, judgment
or decree of any court or governmental authority binding on the
Company and identified in the Officer's Certificate, or (iv) violate
any current California, New York or federal statute, rule or
regulation that such counsel has, in the exercise of customary
professional diligence, recognized as applicable to the Company or to
transactions of the type contemplated by this Agreement, except that
such counsel need express no opinion regarding any federal securities
laws, or securities or blue sky laws of any other jurisdiction, or the
provisions of Section 8 of this Agreement, except as otherwise
expressly stated in such opinion; and
(xi) the statements in the Prospectus under the caption
"Description of Capital Stock," insofar as they summarize provisions
of the Certificate of Incorporation or Bylaws of the Company or the
Securities, fairly present the information required by Form S-3.
Such counsel shall also state that in connection with its
participation in conferences in connection with the preparation of the
Registration Statement and the Prospectus, such counsel has not
independently verified the accuracy, completeness or fairness of the
statements contained or incorporated therein, and the limitations
inherent in the examination made by such counsel and the knowledge
available to such counsel is such that it is unable to assume, and
does not assume, any responsibility for such accuracy, completeness or
fairness (except as otherwise specifically stated in paragraph (xi)
above). However, such counsel shall state that on the basis of such
counsel's review of the Registration Statement, the documents
incorporated therein on the effective date of the Registration
Statement, the Prospectus and the documents incorporated therein on
the date of the Prospectus and such counsel's participation in
conferences in connection with the preparation of the Registration
Statement and the Prospectus, such counsel does not
17
believe that the Registration Statement and the documents incorporated
therein on the effective date of the Registration Statement considered
as a whole as of the effective date of the Registration Statement,
contained any 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, and such counsel does not believe
that the Prospectus and the documents incorporated therein on the date
of the Prospectus, considered as a whole on the date of the opinion,
contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading.
However, such counsel need express no opinion or belief as to any
document filed by the Company under the Exchange Act, whether before
or after the effective date of the Registration Statement, except to
the extent that any such document is an incorporated document read
together with the Registration Statement or the Prospectus and
considered as a whole, nor need such counsel express any opinion or
belief as to the financial statements and other financial information
contained or incorporated by reference in the Registration Statement,
the Prospectus or the incorporated documents.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the States
of California or New York or the Delaware General Corporation Law 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 Prospectus in this paragraph (b)
include any supplements thereto at the Closing Date.
(c) The Company has requested and L. Xxxxxxx Xxxxxxx, General Counsel
of the Company, shall have furnished to the Representatives his opinion, as
General Counsel to the Company, dated the Closing Date and addressed to the
Representatives, to the effect that:
(i) the Company and each of its subsidiaries have been duly
incorporated and are validly existing as corporations in good standing
under the laws of their respective jurisdictions of incorporation with
full corporate power and authority to own, lease and operate their
respective properties and to conduct their respective businesses as
described in the Prospectus and are duly qualified to conduct their
respective businesses and are in good standing as a foreign
corporation in each jurisdiction in which the nature of their
respective ownership or operation of properties or the conduct of
their respective businesses requires such registration or
qualification, except where the failure so to qualify or to be in good
18
standing could not, individually or in the aggregate with all other
such failures, reasonably be expected to have a Material Adverse
Effect;
(ii) all of the issued shares of capital stock of each subsidiary
of the Company have been duly and validly authorized and issued, are
fully paid, non-assessable (except for directors' qualifying shares)
and, based solely on his examination of each such subsidiary's stock
ledger and minute books, all such shares are held of record by the
Company, and are free and clear of all security interests, claims,
liens or encumbrances, except as provided in the Credit
Agreement;
(iii) to such counsel's knowledge, there are no contracts,
agreements or understandings between the Company and any person
granting such person the right to require the Company to include
securities of such person in the Registration Statement;
(iv) to such counsel's knowledge, except as set forth in the
Prospectus and as of the dates specified in the Prospectus, there are
no options, warrants, rights or commitments granted by the Company
with respect to the Company's capital stock and the Company is not
obligated to issue, purchase or redeem any shares of the Company's
capital stock; and
(v) to such counsel's knowledge, there are no legal or
governmental proceedings pending or threatened against the Company or
any of its subsidiaries, or to which the Company or any of its
subsidiaries or any of their respective properties or assets is
subject, which are not disclosed in the Prospectus and which are
reasonably likely, individually or in the aggregate with all other
such proceedings, to have a Material Adverse Effect or have a material
adverse effect upon the consummation of the transactions contemplated
by this Agreement.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the State
of California or the Delaware General Corporation Law or the Federal laws
of the United States, to the extent he deems proper and specified in such
opinion, upon the opinion of other counsel of good standing whom he
believes to be reliable and who are satisfactory to the counsel for the
Underwriters and (B) as to matters of fact, to the extent he deems proper,
on certificates of responsible officers of the Company and public
officials. References to the Prospectus in this paragraph (c) include any
supplements thereto at the Closing Date.
(d) The Selling Stockholder shall have requested and O'Melveny &
Xxxxx LLP, counsel for the Selling Stockholder, shall have furnished to the
Representatives their opinion dated the Closing Date and addressed to the
Representatives, to the effect that:
19
(i) each of this Agreement, the Custody Agreement and the Power
of Attorney has been duly executed and delivered by the Selling
Stockholder;
(ii) the Custody Agreement constitutes the legally valid and
binding obligation of the Selling Stockholder, enforceable against the
Selling Stockholder in accordance with its terms, except as may be
limited by bankruptcy, insolvency, moratorium or similar laws relating
to or affecting creditors' rights generally (including, without
limitation, fraudulent conveyance laws) and by general principles of
equity, including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing and the possible
unavailability of specific performance or injunctive relief,
regardless of whether considered in a proceeding in equity or at law;
(iii) upon payment for and delivery to the Underwriters in New
York of the Securities sold by the Selling Stockholder in accordance
with this Agreement, assuming each of the Underwriters is acquiring
the Securities sold by the Selling Stockholder without notice of any
adverse claim, the Underwriters will acquire the Securities free and
clear of any adverse claim as defined in Article 8 of the Uniform
Commercial Code;
(iv) no order, consent, permit or approval of any California, New
York or federal governmental authority is required on the part of the
Selling Stockholder for the execution and delivery of this Agreement
or the sale of the Securities sold by the Selling Stockholder, except
such as have been obtained under the Act and such as may be required
under the securities or blue sky laws of any other jurisdiction; and
(v) neither the sale of the Securities being sold by the Selling
Stockholder under this Agreement nor the consummation of the other
transactions herein contemplated by the Selling Stockholder will (i)
violate, breach or result in a default under any existing obligation
of or restriction on the Selling Stockholder under any indenture or
other agreement material to the Selling Stockholder and identified in
a Selling Stockholder Certificate, a copy of which shall be delivered
to you, (ii) breach or otherwise violate any existing obligation of or
restriction on the Selling Stockholder under any order, judgment or
decree of any court or governmental authority binding on the Selling
Stockholder and identified in the Selling Stockholder Certificate, or
(iii) violate any current California, New York or federal statute,
rule or regulation that such counsel has, in the exercise of customary
professional diligence, recognized as applicable to the Selling
Stockholder or to transactions of the type contemplated by this
Agreement, except that such counsel need express no opinion regarding
any federal securities laws, or securities or blue sky laws of any
other jurisdiction, or the provisions of Section 8 of
20
this Agreement, except as otherwise expressly stated in such opinion.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the States
of California, New York 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 the Selling
Stockholder and public officials.
(e) The Representatives shall have received from Xxxxxx & Xxxxxxx,
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 Registration Statement, the Prospectus
(together with any supplement thereto) and other related matters as the
Representatives may reasonably require, and the Company and the Selling
Stockholder shall have furnished to such counsel such documents as they
request for the purpose of enabling them to pass upon such matters.
(f) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the Chairman of the Board or the
Chief Executive Officer and the principal financial or accounting officer
of the Company, in their capacities as such officers of the Company, dated
the Closing Date, to the effect that the signers of such certificate have
carefully examined the Registration Statement, the Prospectus, any
supplements to the Prospectus and this Agreement and that:
(i) the representations and warranties of the Company in this
Agreement are true and correct in all material respects on and as of
the Closing Date with the same effect as if made on the Closing Date
and the Company has complied in all material respects with all the
agreements and satisfied in all material respects 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
(iii) since the date of the most recent financial statements
included or incorporated by reference in the 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 in or contemplated in the Prospectus
(exclusive of any
21
supplement thereto).
(g) The Selling Stockholder shall have furnished to the
Representatives a certificate, signed by the Selling Stockholder, dated the
Closing Date, to the effect that the Selling Stockholder has carefully
examined the Registration Statement, the Prospectus, any supplement to the
Prospectus and this Agreement and that the representations and warranties
of the Selling Stockholder in this Agreement are true and correct in all
material respects on and as of the Closing Date to the same effect as if
made on the Closing Date.
(h) The Company shall have requested and PricewaterhouseCoopers
L.L.P. shall have furnished to the Representatives, at the Execution Time
and at the Closing Date, comfort letters, dated respectively as of the
Execution Time and as of the Closing Date, in form and substance
satisfactory to the Representatives, with respect to the financial
statements and financial information contained or incorporated by reference
in the Registration Statement. References to the Prospectus in this
paragraph (h) include any supplement thereto at the date of the letter.
(i) 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 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 (h) of this Section 6 or
(ii) any change, or any development involving a prospective change, in or
affecting the condition (financial or otherwise), earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether
or not arising from transactions in the ordinary course of business, except
as set forth in or contemplated in the 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
Prospectus (exclusive of any supplement thereto).
(j) Prior to the Closing Date, the Company and the Selling
Stockholder shall have furnished to the Representatives such further
information, certificates and documents as the Representatives may
reasonably request.
(k) The Securities shall have been listed and admitted and authorized
for trading on the New York Stock Exchange, and satisfactory evidence of
such actions shall have been provided to the Representatives.
22
(l) At the Execution Time, the Company shall have furnished to the
Representatives a letter substantially in the form of Exhibit A hereto from
each executive officer and director of the Company addressed to the
Representatives.
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 cancelation shall be
given to the Company and the Selling Stockholder 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 Xxxxxx & Xxxxxxx, counsel for the Underwriters,
at 000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxxxxx, Xxxxxxxxxx 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 hereof or
because of any refusal, inability or failure on the part of the Company or
the Selling Stockholder 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 on demand for all out-of-pocket expenses (including
reasonable fees and disbursements of counsel) that shall have been incurred
by them in connection with the proposed purchase and sale of the
Securities. If the Company is required to make any payments to the
Underwriters under this Section 7 because of the Selling Stockholder's
refusal, inability or failure to satisfy any condition to the obligations
of the Underwriters set forth in Section 6, the Selling Stockholder PRO
RATA in proportion to the percentage of Securities to be sold by each shall
reimburse the Company on demand for all amounts so paid.
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 any
Preliminary Prospectus or the 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
23
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 and the Selling Stockholder 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; and FURTHER, PROVIDED, HOWEVER, that
the Company shall not be liable to an Underwriter in respect of any
Preliminary Prospectus, or any amendment or supplement thereto, to the
extent that both (i) all of the untrue statements or alleged untrue
statements or omissions or alleged omissions of a material fact contained
in any Preliminary Prospectus or any amendment or supplement thereto were
fully corrected in the Prospectus or in an amendment or supplement
thereto and (ii) the Prospectus, together with such amendment or
supplement, if any, was provided to such Underwriter by the Company prior
to the time the written confirmation of the sale of Securities to such
person was sent and was not sent or given to the purchaser of the stock
in question by such Underwriter at or prior to the written confirmation
of the sale of Securities to such person. This indemnity agreement will
be in addition to any liability which the Company may otherwise have.
(b) The Selling Stockholder 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, only insofar as
such losses, claims, damages or liabilities (or action 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 any Preliminary Prospectus or the 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 only with reference to written information relating to the
Selling Stockholder furnished to the Company specifically for inclusion in
the documents referred to in the foregoing indemnity, and the Selling
Stockholder 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 Selling Stockholder shall not be liable
to an Underwriter in respect of any Preliminary Prospectus, or any
amendment or supplement thereto, to the extent that both (i) all of the
untrue statements or alleged untrue statements or omissions or alleged
omissions of a material fact contained in any Preliminary Prospectus or any
amendment or supplement thereto were fully corrected in the Prospectus or
in an amendment or supplement thereto and (ii) the Prospectus, together
with such amendment or supplement, if any, was provided to such Underwriter
by the Company prior to the time the written confirmation of the sale of
Securities to such person was sent and was not sent or given to the
purchaser of the stock in question by such Underwriter at or prior to the
written confirmation of the sale of Securities to such person. This
indemnity agreement will be in addition to any liability which the Selling
Stockholder may otherwise have.
(c) 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 and the
Selling Stockholder, to the same extent as the foregoing indemnity to each
Underwriter, but only with reference to written information relating to
such Underwriter furnished to the Company by or on behalf of such
Underwriter through the 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 and the Selling Stockholder acknowledge that the
statements set forth in the last paragraph of the cover page regarding
delivery of the Securities and, under the heading "Underwriting," (i) the
list of Underwriters and their respective participation in the sale of the
Securities, (ii) the paragraph related to concessions and reallowances and
(iii) the paragraphs related to stabilization, syndicate covering
transactions and penalty bids in any Preliminary Prospectus and the
Prospectus constitute the only information furnished in writing by or on
behalf of the several Underwriters for inclusion in any Preliminary
Prospectus or the Prospectus.
(d) 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),
24
(b) or (c) above unless and to the extent it did not otherwise learn of
such action and such failure results in the forfeiture by the indemnifying
party of substantial rights and defenses and (ii) will not, in any event,
relieve the indemnifying party from any obligations to any indemnified
party other than the indemnification obligation provided in paragraph (a),
(b) or (c) above. The indemnifying party shall be entitled to appoint
counsel of the indemnifying party's choice at the indemnifying party's
expense to represent the indemnified party in any action for which
indemnification is sought (in which case the indemnifying party shall not
thereafter be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth below);
PROVIDED, HOWEVER, that such counsel shall be satisfactory to the
indemnified party. Notwithstanding the indemnifying party's election to
appoint counsel to represent the indemnified party in an action, the
indemnified party shall have the right to employ separate counsel
(including local counsel), and the indemnifying party shall bear the
reasonable fees, costs and expenses of such separate counsel if (i) the use
of counsel chosen by the indemnifying party to represent the indemnified
party would present such counsel with a conflict of interest, (ii) the
actual or potential defendants in, or targets of, any such action include
both the indemnified party and the indemnifying party and the indemnified
party shall have reasonably concluded that there may be legal defenses
available to it and/or other indemnified parties which are different from
or additional to those available to the indemnifying party, (iii) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable
time after notice of the institution of such action or (iv) the
indemnifying party shall authorize the indemnified party to employ separate
counsel at the expense of the indemnifying party. An indemnifying party
will not, without the prior written consent of the indemnified parties,
settle or compromise or consent to the entry of any judgment with respect
to any pending or threatened claim, action, suit or proceeding in respect
of which indemnification or contribution may be sought hereunder (whether
or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising
out of such claim, action, suit or proceeding.
(e) In the event that the indemnity provided in paragraph (a), (b) or
(c) of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company, the Selling Stockholder 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, the Selling Stockholder 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 and
the Selling Stockholder 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 to the Securities purchased by such Underwriter
hereunder. If the
25
allocation provided by the immediately preceding sentence is unavailable
for any reason, the Company, the Selling Stockholder 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
and the Selling Stockholder 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 and the Selling Stockholder 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 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 or the Selling Stockholder 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, the Selling Stockholder 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 (e), no person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f)
of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. For purposes of this Section
8, each person who controls an Underwriter within the meaning of either the
Act or the Exchange Act and each director, officer, employee and agent of
an Underwriter shall have the same rights to contribution as such
Underwriter, and each person who controls the Company within the meaning of
either the Act or the Exchange Act, each officer of the Company who shall
have signed the Registration Statement and 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 (e).
(f) The liability of the Selling Stockholder under the Selling
Stockholder's representations and warranties contained in Section 1 hereof
and under the indemnity and contribution agreements contained in this
Section 8 shall be limited to an amount equal to the net proceeds to the
Selling Stockholder of the sale of the Securities sold by the Selling
Stockholder to the Underwriters. The Company and the Selling Stockholder
may agree, as among themselves and without limiting the rights of the
Underwriters under this Agreement, as to the respective amounts of such
liability for which they each shall be responsible.
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
26
the amount of Securities set forth opposite their names in Schedule I
hereto bears to the aggregate 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 amount of
Securities which the defaulting Underwriter or Underwriters agreed but
failed to purchase shall exceed 10% of the aggregate amount of Securities
set forth in Schedule I hereto, the remaining Underwriters shall have the
right to purchase all, but shall not be under any obligation to purchase
any, of the Securities, and if such nondefaulting Underwriters do not
purchase all the Securities, this Agreement will terminate without
liability to any nondefaulting Underwriter, the Selling Stockholder 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
Prospectus or in any other documents or arrangements may be effected.
Nothing contained in this Agreement shall relieve any defaulting
Underwriter of its liability, if any, to the Company, the Selling
Stockholder 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 or the New York Stock Exchange or 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, (ii) a banking moratorium shall have been declared either by
Federal or New York State authorities or (iii) there shall have occurred
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 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, of the Selling Stockholder 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, the Selling Stockholder 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 cancelation 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
00
Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Attention: General Counsel; or, if sent
to the Company, will be mailed, delivered or telefaxed to (000) 000-0000
and confirmed to it at 000 Xxxxxx Xxxxxx, Xx Xxxxxxx, Xxxxxxxxxx 00000,
attention of the Legal Department; or if sent to the Selling Stockholder,
will be mailed, delivered or telefaxed and confirmed to it at the address
set forth in Schedule II hereto.
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.
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.
"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.
"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.
"Preliminary Prospectus" shall mean any preliminary prospectus
referred to in paragraph 1(i)(a) above and any preliminary prospectus
included in the
28
Registration Statement at the Effective Date that omits Rule 430A
Information.
"Prospectus" shall mean the prospectus relating to the Securities
that is first filed pursuant to Rule 424(b) after the Execution Time
or, if no filing pursuant to Rule 424(b) is required, shall mean the
form of final prospectus relating to the Securities included in the
Registration Statement at the Effective Date.
"Registration Statement" shall mean the registration statement
referred to in paragraph 1(i)(a) above, including exhibits and
financial statements, as amended at the Execution Time (or, if not
effective at the Execution Time, in the form in which it shall become
effective) and, in the event any post-effective amendment thereto or
any Rule 462(b) Registration Statement becomes effective prior to the
Closing Date, shall also mean such registration statement as so
amended or such Rule 462(b) Registration Statement, as the case may
be. Such term shall include any Rule 430A Information deemed to be
included therein at the Effective Date as provided by Rule 430A.
"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.
29
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, the Selling Stockholder and the several Underwriters.
Very truly yours,
International Rectifier Corporation
By:
--------------------------------
Name:
Title:
Xxxx Xxxxx
---------------------
Xxxx Xxxxx
30
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
Xxxxxxx Xxxxx Xxxxxx Inc.
X.X. Xxxxxx Securities Inc.
Banc of America Securities LLC
Gruntal & Co., LLC
By: Xxxxxxx Xxxxx Barney Inc.
By:
--------------------------
Name:
Title:
For themselves and the other
several Underwriters named in
Schedule I to the foregoing
Agreement.
SCHEDULE I
NUMBER OF UNDERWRITTEN SECURITIES
UNDERWRITERS TO BE PURCHASED
------------ ---------------------------------
Xxxxxxx Xxxxx Xxxxxx Inc.
X.X. Xxxxxx Securities Inc.
Banc of America Securities LLC
Gruntal & Co., LLC
-------------
Total ................ 8,000,000
SCHEDULE II
NUMBER OF UNDERWRITTEN
SELLING STOCKHOLDER: SECURITIES TO BE SOLD
-------------------- ---------------------
Xxxx Xxxxx 400,000 shares
[address, fax no.]...............
Total ................ 400,000 shares
[LETTERHEAD OF OFFICER, DIRECTOR OR MAJOR STOCKHOLDER OF
CORPORATION]
INTERNATIONAL RECTIFIER CORPORATION
PUBLIC OFFERING OF COMMON STOCK
, 2000
Xxxxxxx Xxxxx Barney Inc.
X.X. Xxxxxx Securities Inc.
Banc of America Securities LLC
Gruntal & Co., LLC
As Representatives of the several Underwriters,
c/o Xxxxxxx Xxxxx Barney Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
This letter is being delivered to you in connection with the proposed
Underwriting Agreement (the "Underwriting Agreement"), between International
Rectifier Corporation, a Delaware corporation (the "Company"), and each of you
as representatives of a group of Underwriters named therein, relating to an
underwritten public offering of Common Stock, $1.00 par value (the "Common
Stock"), of the Company.
In order to induce you and the other Underwriters to enter into the
Underwriting Agreement, the undersigned 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 cash settlement or
otherwise), directly or indirectly, including the participation in the filing of
a registration statement with the Securities and Exchange 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 Securities
Exchange Act of 1934, as amended, with respect to, any shares of capital stock
of the Company or any securities convertible into, or exercisable or
exchangeable for such capital stock, or publicly announce an intention to effect
any such transaction, for a period of 90 days after the date of this Agreement,
other than shares of Common Stock disposed of as bona fide gifts
If for any reason the Underwriting Agreement shall be terminated prior to
the Closing Date (as defined in the Underwriting Agreement), the agreement set
forth above shall likewise be terminated.
Yours very truly,
[SIGNATURE OF EXECUTIVE OFFICER OR DIRECTOR]
[NAME AND ADDRESS OF EXECUTIVE OFFICER OR DIRECTOR]
