EXHIBIT 1.1
XXXXXX PETROLEUM COMPANY
____% SENIOR SUBORDINATED NOTES DUE 2001
UNDERWRITING AGREEMENT
__________, 1996
Xxxxxx Xxxxxx & Company, Inc.
00 Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxx 00000
Dear Sirs:
SECTION 1. INTRODUCTORY. Xxxxxx Petroleum Company, a Delaware
corporation (the "Company"), proposes to issue and sell to the one or more
Underwriters named in Schedule I hereto (the "Underwriters"), $15,000,000
principal amount of its ____% Senior Subordinated Notes due 2001 (the "Firm
Notes") and, at the election of the Underwriters, up to an aggregate of
$2,250,000 additional principal amount of such Notes (the "Optional Notes")
solely to cover over-allotments, if any. The Firm Notes and the Optional Notes
are herein collectively referred to as the "Securities." The Securities are to
be issued pursuant to the provisions of an indenture to be dated as of
_________, 1996 (the "Indenture") between the Company and ____________________,
as trustee (the "Trustee"). As used herein, the terms "Underwriters" and "you"
shall be deemed to refer only to Xxxxxx Xxxxxx & Company, Inc., in the event
that such firm is the sole Underwriter named in Schedule I hereto.
The Company hereby agrees with the Underwriters as follows:
SECTION 2. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY.
The Company represents and warrants to, and agree with, each of the Underwriters
that:
(a) The Company has filed, in accordance with the provisions of
the Securities Act of 1933, as amended (the "Act"), with the Securities
and Exchange Commission (the "Commission") a registration statement on
Form S-1, including a prospectus, relating to the Securities, which
incorporates by reference documents which the Company has filed or will
file in accordance with the provisions of the Securities Exchange Act of
1934, as amended (the "Exchange Act"). The Company has furnished to you,
for use by the Underwriters and by dealers, copies of one or more
preliminary prospectuses and the documents incorporated by reference
therein (each thereof, including the documents incorporated therein by
reference, being herein called a "Preliminary Prospectus") relating to
the Securities. Except where the context otherwise requires, such
registration statement, as amended when it
becomes effective, including all documents filed as a part thereof or
incorporated by reference therein, and including any information
contained in a prospectus subsequently filed with the Commission
pursuant to Rule 424(b) under the Act and deemed to be part of the
registration statement at the time of
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effectiveness pursuant to Rule 430(A) under the Act, is herein called
the "Registration Statement," and the prospectus, including all
documents incorporated therein by reference, in the form filed by the
Company with the Commission pursuant to Rule 424(b) under the Act or, if
no such filing is required, the form of final prospectus included in the
Registration Statement at the time it became effective, is herein called
the "Prospectus."
(b) When the Registration Statement becomes effective and at all
times subsequent thereto up to the latest Closing Date hereinafter
mentioned, the Registration Statement and the Prospectus, and any
amendments or supplements thereto, will conform in all material respects
with the requirements of the Act and the rules and regulations (the
"Rules and Regulations") of the Commission thereunder, and at such
effective time the Registration Statement will not include any untrue
statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not
misleading, and the Prospectus, as it may be amended or supplemented at
the applicable Closing Date, will not contain any untrue statement of
material fact or omit to state a material fact necessary to make the
statements contained therein, in the light of the circumstances under
which they were made, not misleading; except that the foregoing does not
apply to (i) that part of the Registration Statement that constitutes
the Statement of Eligibility and Qualification (Form T-1) under the
Trust Indenture Act of 1939, as amended (the "1939 Act"), of the
Trustee, and (ii) statements or omissions in the Registration Statement
or the Prospectus, as amended or supplemented if applicable, based upon
written information furnished to the Company by any Underwriter through
you specifically for use therein.
(c) The documents incorporated by reference in the Prospectus, at
the time they were or hereafter are filed with the Commission, conformed
or will conform in all material respects to the requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
the rules and regulations thereunder, and when read together and with
the other information in the Prospectus, at the time the Registration
Statement and any amendment thereto become effective, will not contain
an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading.
(d) The only subsidiaries (as defined in the Rules and
Regulations) of the Company are the corporations listed on Schedule II
attached hereto (the "Subsidiaries"). The Company is, and at each
Closing Date will be, a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware. Each of the
Subsidiaries is, and as of each Closing Date will be, a corporation duly
organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation. CN Resources (the "Partnership") is the
only partnership of which the Company or any of its Subsidiaries is a
general partner or owns fifty percent or more of the partnership
interests. The Partnership
is a general partnership duly organized, validly existing and in good
standing under the laws of the State of ________, and the Company owns
all of the partnership interests in the Partnership. Each of the
Company, its Subsidiaries and the Partnership has, and at each Closing
Date will have, full power and authority to conduct all the activities
conducted by it, to own or lease all the assets owned or leased by it
and to conduct its business as described in the Registration Statement
and the Prospectus. Each of the Company, its Subsidiaries and the
Partnership is, and at each Closing Date will be, duly licensed or
qualified to do business and in good standing as a foreign corporation
or partnership in all jurisdictions in which the nature of the
activities conducted by it or the character of the assets owned or
leased by it makes such licensing or qualification necessary. All of the
issued
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and outstanding capital stock of each Subsidiary has been duly
authorized and validly issued and is fully paid and non-assessable, and
all such capital stock of each Subsidiary is owned by the Company,
either directly or indirectly through Subsidiaries as indicated in
Schedule II hereto, free and clear of any mortgage, pledge, lien,
encumbrance, claim or equity [except for liens in favor of the lenders
under the Credit Facility (as defined in the Registration Statement)].
Except for the stock of the Subsidiaries and the interests in the
Partnership and as disclosed in the Registration Statement, the Company
does not own, and at each Closing Date will not own, directly or
indirectly, any shares of stock or any other equity or long-term debt
securities of any corporation or have any equity interest in any firm,
partnership, joint venture, association or other entity.
(e) The Securities have been duly authorized and, when issued,
authenticated by the Trustee and delivered in accordance with this
Agreement and the Indenture, will constitute valid and binding
obligations of the Company, enforceable against the Company in
accordance with their terms and entitled to the benefits provided by the
Indenture, except as may be limited by bankruptcy, insolvency,
reorganization, fraudulent conveyance or other laws of general
application relating to or affecting creditors' rights generally or the
availability of equitable remedies, regardless of whether such
enforcement is considered in a proceeding in equity or at law; the
Indenture has been duly authorized and, when duly executed and delivered
by the Company and the Trustee, will constitute a valid and binding
agreement of the Company, enforceable against the Company in accordance
with its terms, except as may be limited by bankruptcy, solvency,
reorganization, fraudulent conveyance or other laws of general
application relating to or affecting creditors' rights generally or the
availability of equitable remedies, regardless of whether such
enforcement is considered in a proceeding in equity or at law.
(f) The consolidated financial statements and related notes and
schedules included or incorporated by reference in the Registration
Statement or the Prospectus present fairly the consolidated financial
position of the Company as of the respective dates thereof and the
consolidated results of operations and cash flows of the Company for the
respective periods covered thereby, all in conformity with generally
accepted accounting principles applied on a consistent basis throughout
the entire period involved, except as otherwise disclosed in such
consolidated financial statements or notes. No other historical
financial statements or schedules of the Company are required by the
Act, the Exchange Act or the Rules and Regulations to be included in the
Registration Statement or the Prospectus. Xxxxxx Xxxxxxxx LLP (the
"Accountants") who have reported on such consolidated financial
statements and schedules, are independent accountants with respect to
the Company and the Subsidiaries as required by the Act and the Rules
and Regulations. The statements included in the Registration Statement
with respect to the Accountants pursuant to Rule 509 of Regulation S-K
of the Rules and Regulations are true and correct in all material
respects.
(g) The selected financial information included in the
Registration Statement or the Prospectus presents fairly the information
shown therein and has been compiled on a basis consistent with that of
the audited consolidated financial statements of the Company included or
incorporated by reference therein. The pro forma financial statements
and other pro forma information (including the notes thereto) included
in the Registration Statement or the Prospectus (i) present fairly in
all material respects the information shown therein, (ii) have been
prepared in accordance with the applicable requirements of Rule 11-02 of
Regulation S-X promulgated under the Act and (iii) have been properly
computed on the basis described therein and the
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assumptions used in preparing the pro forma financial statements and
other pro forma data included in the Registration Statement or the
Prospectus are reasonable.
(h) The Company maintains a system of internal accounting control
sufficient to provide reasonable assurance that (i) transactions are
executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for
assets; (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 existing assets at reasonable
intervals and appropriate action is taken with respect to any
differences.
(i) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus and prior to the
latest Closing Date, except as set forth in or contemplated by the
Registration Statement and the Prospectus, (i) there has not been and
will not have been any change in the capitalization of the Company, or
material adverse change in the business, properties, business prospects,
condition (financial or otherwise) or results of operations of the
Company, its Subsidiaries and the Partnership, taken as a whole, arising
for any reason whatsoever, (ii) neither the Company nor any of its
Subsidiaries or the Partnership has incurred nor will it incur any
material liabilities or obligations, direct or contingent, nor has it
entered into nor will it enter into any material transactions other
than, in any case, pursuant to this Agreement and the transactions
referred to herein or in the ordinary course of business and (iii) the
Company has not and will not have paid or declared any dividends or
other distributions of any kind on any class of its capital stock
(except for dividends at an annual rate of $2.125 per share with respect
to the $2.125 Convertible Exchangeable Preferred Stock, Series A of the
Company (the "Series A Preferred Stock")).
(j) The Company is not an "investment company" or an "affiliated
person" of, or "promoter" or "principal underwriter" for, an "investment
company," as such terms are defined in the Investment Company Act of
1940, as amended.
(k) Except as set forth in the Registration Statement and the
Prospectus, there are no actions, suits or proceedings pending or
threatened against or affecting the Company, any of its Subsidiaries or
the Partnership, or any of their respective officers or partners in
their capacity as such, before or by any Federal or state court,
commission, regulatory body, administrative agency or other governmental
body, domestic or foreign, wherein an unfavorable ruling, decision or
finding might materially and adversely affect the Company, its
Subsidiaries and the Partnership, taken as a whole, or the business,
properties, business prospects, condition (financial or otherwise) or
results of operations of the Company, its Subsidiaries and the
Partnership, taken as a whole.
(l) Each of the Company, its Subsidiaries and the Partnership
has, and at each Closing Date will have, (i) all material governmental
licenses, permits, consents, orders, approvals and other authorizations
necessary to carry on its business as contemplated in the Prospectus,
(ii) complied in all respects with all laws, regulations and orders
applicable to it or its business, including without limitation,
environmental laws and regulations, except where noncompliance with such
laws, regulations or orders would not have a material adverse effect on
the Company, its Subsidiaries and the Partnership, taken as a whole, or
the business, properties, business prospects, condition (financial or
otherwise) or results of operations of the Company,
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its Subsidiaries and the Partnership, taken as a whole, and (iii)
performed all its obligations required to be performed by it, and is
not, and at each Closing Date will not be, in default, under any
indenture, mortgage, deed of trust, voting trust agreement, loan
agreement, bond, debenture, note agreement, lease, contract or other
agreement or instrument (collectively, a "contract or other agreement")
to which it is a party or by which its property is bound or affected,
except where such nonperformance or default would not, individually or
in the aggregate, have a material adverse effect on the Company, its
Subsidiaries and the Partnership, taken as a whole, or the business,
properties, business prospects, condition (financial or otherwise) or
results of operations of the Company, its Subsidiaries and the
Partnership, taken as a whole. To the knowledge of the Company, no other
party under any contract or other agreement to which it or any of its
Subsidiaries or the Partnership is a party is in default in any respect
thereunder. Neither the Company nor any of its Subsidiaries or the
Partnership is, nor at either Closing Date will any of them be, in
violation of any provision of its certificate of incorporation or bylaws
or other organizational documents, or of its certificate of limited
partnership or agreement of limited partnership.
(m) No consent, approval, authorization or order of, or any
filing or declaration with, any court or governmental agency or body is
required for the consummation by the Company of the transactions on its
part contemplated herein and in the Indenture and the Securities, except
such as have been obtained under the Act and the rules and regulations
promulgated thereunder, the 1939 Act or the Rules and Regulations and
such as may be required under the bylaws and rules of the National
Association of Securities Dealers, Inc. (the "NASD") in connection with
the purchase and distribution by the Underwriters of the Securities.
(n) The Company has full corporate power and authority to enter
into this Agreement. This Agreement has been duly authorized, executed
and delivered by the Company and constitutes a valid and binding
agreement of the Company, enforceable against the Company in accordance
with the terms hereof, except as may be limited by bankruptcy,
insolvency, reorganization, fraudulent conveyance or other laws of
general application relating to or affecting creditors' rights generally
or the availability of equitable remedies, regardless of whether such
enforcement is considered in a proceeding in equity or at law. The
performance by the Company of its obligations under this Agreement, the
Indenture and the Securities and the consummation by it of the
transactions contemplated hereby and thereby will not result in the
creation or imposition of any lien, charge or encumbrance upon any of
the assets of the Company or any of its Subsidiaries or the Partnership
pursuant to the terms or provisions of, or result in a breach or
violation of any of the terms or provisions of, or constitute a default
under, or give any other party a right to terminate any of its
obligations under, or result in the acceleration of any obligation
under, the certificate or articles of incorporation, bylaws or other
organizational documents of the Company or any of its Subsidiaries, the
agreement of partnership of the Partnership, any contract or other
agreement to which the Company or any of its Subsidiaries or the
Partnership is a party or by which the Company or any of its
Subsidiaries or the Partnership, or any of their respective properties
is bound or affected, or violate or conflict with any judgment, ruling,
decree, order, statute, rule or regulation of any court or other
governmental agency or body applicable to the business or properties of
the Company or any of its Subsidiaries or the Partnership.
(o) The Company and each of its Subsidiaries and the Partnership
has good and indefeasible title to all properties and assets described
in the Prospectus as owned by it, free and clear of all liens, charges,
encumbrances or restrictions, except such as are described in the
Prospectus or are not material to the business of the Company or its
Subsidiaries or the
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Partnership. Each of the Company, its Subsidiaries and the Partnership
has valid, subsisting and enforceable leases for the properties
described in the Prospectus as leased by it, with such exceptions as are
not material and do not materially interfere with the use made and
proposed to be made of such properties by it.
(p) There is no document or contract of a character required to
be described in the Registration Statement or the Prospectus or to be
filed as an exhibit to the Registration Statement which is not described
or filed as required. All such contracts to which the Company or any
Subsidiary or the Partnership is a party have been duly authorized,
executed and delivered by the Company or such Subsidiary or the
Partnership, constitute valid and binding agreements of the Company or
such Subsidiary or the Partnership and are enforceable against the
Company or such Subsidiary or the Partnership in accordance with the
terms thereof, except as may be limited by bankruptcy, insolvency,
reorganization or other laws of general application relating to or
affecting creditors' rights generally or the availability of equitable
remedies, regardless of whether such enforcement is considered in a
proceeding in equity or at law.
(q) No statement, representation, warranty or covenant made by
the Company in this Agreement or the Indenture or in any certificate or
document required by this Agreement to be delivered to the Underwriters
was or will be, when made, inaccurate, untrue or incorrect in any
material respect.
(r) Neither the Company nor, to its knowledge, any of its
directors, officers or controlling persons has taken, directly or
indirectly, any action intended, or which might reasonably be expected,
to cause or result, under the Act or otherwise, in, or which has
constituted, stabilization or manipulation of the price of any security
of the Company to facilitate the sale or resale of the Securities.
(s) No holder of securities of the Company has rights to the
registration of any securities of the Company because of the filing of
the Registration Statement which have not been waived.
(t) Neither the Company nor any of its Subsidiaries or the
Partnership is involved in any material labor dispute nor, to the
knowledge of the Company, is any such dispute threatened.
(u) The Company and its Subsidiaries and the Partnership own, or
are licensed or otherwise have the full exclusive right to use, all
material trademarks and trade names which are used in or necessary for
the conduct of their respective businesses as described in the
Prospectus. No claims have been asserted by any person to the use of any
such trademarks or trade names or challenging or questioning the
validity or effectiveness of any such trademark or trade name. The use,
in connection with the business and operations of the Company and its
Subsidiaries the and Partnership of such trademarks and trade names does
not, to the Company's knowledge, infringe on the rights of any person.
(v) The Company maintains insurance policies currently in effect,
including levels of deductibles, that are customary in the oil and gas
industry. Such policies provide coverage for operations of the Company,
its Subsidiaries and the Partnership in amounts and covering such risks
as the Company believes is necessary to conduct its business.
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(w) Neither the Company nor any of its Subsidiaries or the
Partnership nor, to the Company's knowledge, any employee or agent of
the Company or any Subsidiary or the Partnership has made any payment of
funds of the Company or any Subsidiary or the Partnership or received or
retained any funds in violation of any law, rule or regulation.
(x) The common stock of the Company is duly authorized for
trading on the Nasdaq National Market System.
(y) The Company has an authorized equity capitalization as set
forth in the Prospectus under the caption "Capitalization," and all of
the issued shares of capital stock of the Company have been duly and
validly authorized and issued and are fully paid and non-assessable.
(z) Neither the Company nor any Subsidiary or the Partnership is
a "holding company" or a "subsidiary company" of a "holding company," or
an "affiliate" of a "holding company" or of a "subsidiary company" of a
"holding company," or a "public utility" within the meaning of the
Public Utility Holding Company Act of 1935, as amended.
SECTION 3. PURCHASE, SALE AND DELIVERY OF SECURITIES. On the basis of
the representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, (i) the Company agrees to issue and
sell to the Underwriters, and each Underwriter agrees, severally and not
jointly, to purchase from the Company at a purchase price of _____% of the
principal amount per Security plus accrued interest, if any, from _________,
1996 to the date of payment and delivery, the respective principal amount of
Firm Notes set forth opposite such Underwriter's name in Schedule I hereto, and
(ii) in the event and to the extent that the Underwriters shall exercise the
election to purchase Optional Notes as provided below, the Company agrees to
issue and sell to the Underwriters, and the Underwriters agree to purchase from
the Company, at the same purchase price per Security set forth in clause (i) of
this Section 3, the aggregate principal amount of the Optional Notes as to which
such election shall have been exercised. If the option is exercised as to all or
any portion of the Optional Notes, the Optional Notes as to which the option is
exercised shall be purchased by the Underwriters, severally and not jointly, in
proportion to their purchases of the Firm Notes.
The Company hereby grants to the Underwriters the right to purchase at
their election up to $2,250,000 aggregate principal amount of Optional Notes, at
the purchase price per Security set forth in clause (i) of the first paragraph
of this Section 3, for the sole purpose of covering any over-allotments in the
sale of Firm Notes. Any such election to purchase Optional Notes may be
exercised by written notice from you to the Company, given within a period of 30
calendar days after the date of this Agreement, setting forth the aggregate
principal amount of Optional Notes to be purchased and the date on which such
Optional Notes are to be delivered, as determined by you but in no event earlier
than the First Closing Date (as hereinafter defined) or, unless you and the
Company otherwise agree in writing, earlier than two or later than ten business
days after the date of such notice.
The Securities to be purchased by each Underwriter hereunder will be
represented by one or more definitive global securities in book-entry form which
will be deposited by or on behalf of the Company with The Depository Trust
Company ("DTC") or its designated custodian. The Company will deliver the
Securities to Xxxxxx Xxxxxx & Company, Inc., for the account of each
Underwriter, against payment by or on behalf of such Underwriter of the purchase
price therefor by same day funds, by causing DTC to credit the Securities to the
account of Xxxxxx Xxxxxx & Company, Inc. at DTC. The time and date of such
delivery and payment shall be, with respect to the Firm Notes, 10:00 a.m.,
Eastern Time, on ______________, 1996, or such other time and date as the
Underwriters and the Company may agree
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upon in writing and, with respect to the Optional Notes, 10:00 a.m., Eastern
Time, on the date specified by the Underwriters in the written notice given by
them of their election to purchase such Optional Notes, or such other time and
date as the Underwriters and the Company may agree upon in writing. Such time
and date for delivery of the Firm Notes is herein called the "First Closing
Date," such time and date for delivery of the Optional Notes, if not the First
Closing Date, is herein called the "Second Closing Date," and each such time and
date for delivery is herein called a "Closing Date."
SECTION 4. OFFERING BY UNDERWRITERS. After the Registration Statement
becomes effective the several Underwriters will offer the Securities for sale to
the public on the terms as set forth in the Prospectus, but after the initial
public offering of the Securities they may, in their discretion, vary the public
offering price.
SECTION 5. COVENANTS OF THE COMPANY. The Company covenants and agrees
with each of the Underwriters that:
(a) The Company will advise you promptly of any proposal to amend
or supplement the registration statement as filed, or the related
prospectus, prior to the effectiveness of the Registration Statement,
and will not effect such amendment or supplement without your consent,
which will not be unreasonably withheld; the Company will also advise
you promptly of the effectiveness of the Registration Statement, of the
filing or effectiveness of any amendment or supplement to the
Registration Statement or the Prospectus, and of receipt of notification
of the institution by the Commission of any stop order proceedings in
respect of the Registration Statement or the initiation or threatening
of any proceeding for such purpose, and will use every reasonable effort
to prevent the issuance of any such stop order and to obtain as soon as
possible its lifting, if issued. The term "supplement" and "amendment"
or "amend" as used in this Agreement shall include all documents
subsequently filed by the Company with the Commission pursuant to the
Exchange Act that are deemed to be incorporated by reference in the
Prospectus.
(b) If, during such period of time after the first date of the
public offering of the Securities as in the opinion of counsel for the
Underwriters a prospectus relating to the Securities is required by law
to be delivered in connection with sales by an Underwriter or dealer,
any event occurs as a result of which the Prospectus as then amended or
supplemented would, in the judgment of the Underwriters and their
counsel, include an untrue statement of a material fact, or omit to
state a material fact necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading, or if
it is necessary at any time to amend the Prospectus to comply with the
Act or any other law, the Company promptly will prepare and file with
the Commission an amendment or supplement which will correct such
statement or omission or an amendment which will effect such compliance
and will notify you and, upon your request, prepare and furnish without
charge to each Underwriter and to any dealer in securities as many
copies as you may from time to time reasonably request of an amended
Prospectus or a supplement to the Prospectus which will correct such
statement or omission or effect such compliance.
(c) The Company will make generally available to the Company's
security holders as soon as practicable an earning statement covering
the twelve month period ending December 31, 1997, that satisfies the
provisions of Section 11 (a) of the Act and the Rules and Regulations
(including Rule 158).
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(d) The Company will deliver to each Underwriter one signed and
as many conformed copies of the Registration Statement (as originally
filed) and of each amendment thereto (including exhibits thereto and
documents incorporated therein by reference) as you may reasonably
request.
(e) The Company will use the net proceeds it receives from the
sale of the Securities in the manner specified in the Prospectus under
the caption "Use of Proceeds."
(f) So long as any Securities are outstanding, the Company will
furnish to each of the Underwriters, as soon as practicable after the
end of each fiscal year, a copy of its annual report to stockholders for
such year, and the Company will furnish to them (i) as soon as
available, a copy of each report or definitive proxy statement of the
Company filed with the Commission under the Exchange Act or mailed to
stockholders, (ii) every material press release in respect of the
Company that it may prepare or release and (iii) from time to time, such
other information concerning the Company as you may reasonably request.
(g) The Company, during the period when the Prospectus is
required to be delivered under the Act, will timely file all documents
required to be filed with the Commission pursuant to Section 13 or 14 of
the Exchange Act.
(h) Prior to the latest Closing Date, the Company will notify you
in writing immediately if any event occurs that renders any of the
representations and warranties of the Company contained herein
inaccurate or incomplete in any material respect.
SECTION 6. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS. The
obligations of the several Underwriters to purchase and pay for the Securities
to be delivered on each Closing Date will be subject to the accuracy of the
representations and warranties on the part of the Company herein as of the date
hereof and as of such Closing Date with the same force and effect as if made as
of that date, to the performance by the Company of its obligations hereunder and
to the following additional conditions precedent:
(a) The Registration Statement shall have become effective (or if
a post-effective amendment is required to be filed pursuant to Rule 430A
under the Act, such post-effective amendment shall have become
effective) not later than 5:00 P.M., Eastern Time, on the date of this
Agreement, or such later time or date as shall have been consented to by
you; and prior to such Closing Date 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 to the
knowledge of the Company or you, shall be contemplated by the
Commission.
(b) You shall not have advised the Company that the Registration
Statement or Prospectus, or any amendment or supplement thereto,
contains an untrue statement of fact or omits to state a fact which, you
have concluded, is material and in the case of an omission is required
to be stated therein or is necessary to make the statements therein not
misleading.
(c) You shall have received a favorable opinion of Xxxxxx &
Xxxxxx, L.L.P., counsel for the Company, dated the Closing Date to the
effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
State of Delaware with corporate
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power and authority to own, lease and operate its assets and
conduct its business as described in the Registration Statement;
and the Company is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction
in which the nature of its activities requires such
qualification.
(ii) Each of the Subsidiaries of the Company has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation,
has corporate power and authority to own, lease and operate its
assets and conduct its business as described in the Prospectus,
and is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which
the nature of its activities requires such qualification. The
Partnership is validly existing as a general partnership under
the laws of the State of ____________ and has partnership power
and authority to own, lease and operate its assets and conduct
its business as described in the Prospectus.
(iii) The Company is the sole record owner, directly or
indirectly, of all of the outstanding capital stock of each of
the Subsidiaries.
(iv) The Company has full corporate power and authority to
enter into this Agreement, and this Agreement has been duly
authorized, executed and delivered by the Company.
(v) The Indenture has been duly authorized, executed and
delivered by the Company and is duly qualified under the Trust
Indenture Act and (assuming it has been duly authorized, 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 may be limited by bankruptcy, insolvency,
reorganization, fraudulent conveyance or other laws of general
application relating to or affecting creditors' rights generally
or the availability of equitable remedies, regardless of whether
such enforcement is considered in a proceeding in equity or at
law.
(vi) The Notes have been duly authorized, issued and
delivered by the Company (and assuming they have been duly
authenticated by the Trustee in accordance with the Indenture)
constitute valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms
and entitled to the benefits provided by the Indenture, except as
may be limited by bankruptcy, insolvency, reorganization,
fraudulent conveyance or other laws of general application
relating to or affecting creditors' rights generally or the
availability of equitable remedies, regardless of whether such
enforcement is considered in a proceeding in equity or at law.
(vii) The Registration Statement is effective under the
Act and, to the knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement has
been issued under the Act or proceedings therefor initiated or
threatened by the Commission.
(viii) Statements set forth in the Prospectus under the
headings "Description of Existing Securities and Debt
Instruments" and "Description of Notes" and in the Registration
Statement in Item 15 insofar as such statements constitute a
summary of the
-10-
legal matters, documents or proceedings referred to therein
fairly present the information called for with respect to such
legal matters, documents and proceedings.
(ix) No consent, approval, authorization or order of, or
any filing or declaration with any court or governmental agency
or body is required for the consummation by the Company of the
transactions on its part contemplated herein and in the Indenture
and the Securities, except such as have been obtained under the
Act and the Rules and Regulations, the 1939 Act or the rules and
regulations thereunder and such as may be required under the
bylaws and rules of the NASD in connection with the purchase and
distribution by the Underwriters of the Securities;
(x) The execution and delivery of this Agreement, the
Securities and the Indenture and the consummation of the
transactions contemplated herein will not conflict with or
constitute a breach of, or default under, or result in the
creation of any lien, charge or encumbrance on any property, or
assets of the Company or any of its Subsidiaries or the
Partnership pursuant to any material contract, indenture,
mortgage, loan agreement, note, lease or other instrument known
to such counsel to which the Company or any of its Subsidiaries
or the Partnership is a party or by which it or any of them may
be bound or to which the property or assets of the Company or any
of its Subsidiaries or the Partnership is subject, nor will such
action result in a violation of the provisions of the charter or
bylaws of the Company or any law, administrative regulation or
administrative court decree.
(xi) To the knowledge of such counsel, except as set forth
in the Registration Statement and the Prospectus, there are no
actions, suits or proceedings pending or threatened against or
affecting the Company, any of its Subsidiaries or the
Partnership, or any of their respective officers or partners in
their capacity as such, before or by any Federal or state court,
commission, regulatory body, administrative agency or other
governmental body, domestic or foreign, wherein an unfavorable
ruling decision or finding might materially and adversely affect
the Company, any of its Subsidiaries or the Partnership, or their
respective business, properties, business prospects, condition
(financial or otherwise) or results of operations; and
(xii) Such counsel (1) is of the opinion that each
document incorporated by reference in the Registration Statement
and the Prospectus complied as to form when filed with the
Commission in all material respects with the Exchange Act and the
rules and regulations of the Commission thereunder, (2) is of the
opinion that the Registration Statement complies as to form in
all material respects with the requirements of the Act and the
Rules and Regulations, and (3) believes that the Registration
Statement (excluding the part thereof that constitutes the Form
T-1), at the time it became effective, did not contain any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading and that the Prospectus, as amended or
supplemented at such Closing Date, does not contain 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.
(d) You shall have received from Xxxxxx & Xxxxxx L.L.P., counsel
for the Underwriters, an opinion, dated such Closing Date, with respect
to the matters set forth in the first
-11-
clause of (i), and in (iv), (v), (vi),(viii) (but only as to the
statements in the Prospectus under "Description of Notes") and clauses
(2) and (3) of (xii) of paragraph (c) of this Section.
With respect to subparagraph (xii) of paragraph (c) above, Xxxxxx
& Xxxxxx, L.L.P. may state their opinion and belief are based upon their
participation in the preparation of the Registration Statement and
Prospectus and any amendments or supplements thereto and documents
incorporated therein by reference and review and discussion of the
contents thereof, but is without independent check or verification
except as specified. With respect to clauses (2) and (3) of subparagraph
(xii) of paragraph (c) above, Xxxxxx & Xxxxxx L.L.P. may state that
their opinion and belief are based upon their participation in the
preparation of the Registration Statement and Prospectus and any
amendments or supplements thereto (but not including documents
incorporated therein by reference) and review and discussion of the
contents thereof (including documents incorporated therein by reference
), but is without independent check or verification except as specified.
With respect to subparagraph (xii) of paragraph (c) above, Xxxxxx &
Xxxxxx, L.L.P. and Xxxxxx & Xxxxxx L.L.P. may state that they are not
giving advice as to the financial statements, schedules, reserve
information and other financial and statistical data included in the
Registration Statement or in the Prospectus or in any document
incorporated by reference therein.
(e) At such Closing Date there shall not have been, since the
date of this Agreement or since the respective dates as of which
information is given in the Registration Statement, any material adverse
change in the condition, financial or otherwise, earnings, business
affairs or business prospects of the Company, its Subsidiaries and the
Partnership, considered as a whole, whether or not arising in the
ordinary course of business, and you shall have received a certificate
of the chief executive officer and the chief financial officer of the
Company, dated as of such Closing Date, to the foregoing effect and to
the further effect that the representations and warranties of the
Company contained in Section 2 are true and correct with the same force
and effect as though made on and as of such Closing Date.
(f) You shall have received letters from the Accountants, the
first delivered the day of but prior to the execution of, and dated the
date of, this Agreement and the others dated the applicable Closing
Date, addressed to the Underwriters (with conformed copies for each of
the Underwriters), in the form heretofore agreed (and in the case of
each letter delivered on a Closing Date, consistent with the first such
letter) with such variations as are reasonably acceptable to you.
(g) The NASD, upon review of the terms of the public offering of
the Securities, shall not have objected to such offering, such terms or
the Underwriters' participation in the same.
If any of the conditions specified in this Section 6 shall not have been
fulfilled when and as required by this Agreement to be fulfilled, then this
Agreement may be terminated by you on notice to the Company at any time at or
prior to the First Closing Time, and such termination shall be without liability
of any party to the other, except as provided in Section 7. Notwithstanding any
such termination, the provisions of Sections 8, 12 and 14 shall remain in
effect.
SECTION 7. PAYMENT OF EXPENSES. The Company will pay all costs,
expenses, fees and taxes incident to (i) the preparation by the Company,
printing, filing and distribution under the Act of the Registration Statement
(including financial statements and exhibits), the Prospectus, each Preliminary
Prospectus and all amendments and supplements to any of them prior to or during
the period specified
-12-
in Section 5(b), (ii) the preparation, printing (including word processing and
duplication costs) and delivery of this Agreement, the Indenture, and all other
agreements, memoranda, correspondence and other documents printed and delivered
in connection with the offering of the Securities, (iii) the registration with
the Commission, and the issuance by the Company of the Securities, (iv) the
filings and clearance with the NASD in connection with the offering and (v) the
performance by the Company of its other obligations under this Agreement.
If this Agreement is terminated by you in accordance with the provisions
of Section 6 or Section 10(i), the Company shall reimburse you for all of your
out-of-pocket expenses, including the reasonable fees and disbursements of
counsel for the Underwriters.
SECTION 8. INDEMNIFICATION AND CONTRIBUTION. (a) The Company will
indemnify and hold harmless each Underwriter against any losses, claims, damages
or liabilities, joint or several, to which such Underwriter may become subject
under the Act, the Exchange Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon any breach of any warranty or covenant of the Company herein contained or
any untrue statement or alleged untrue statement of a material fact contained in
any Preliminary Prospectus, the Registration Statement or the Prospectus, or any
amendment 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, or arise out
of or are based upon the performance by the Underwriters in any capacity of any
services to the Company, and will reimburse each Underwriter for any legal or
other expenses reasonably incurred by such Underwriter in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that the Company shall 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 an untrue statement or alleged untrue statement or omission or alleged
omission made in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or any such amendment or supplement, in reliance upon and in
conformity with written information furnished to the Company by any Underwriter
expressly for use therein. In addition to its other obligations under this
Section 8(a), the Company agrees that, as an interim measure during the pendency
of any such claim, action, investigation, inquiry or other proceeding arising
out of or based upon any statement or omission, or any alleged statement or
omission, described in this Section 8(a), they will reimburse the Underwriters
on a monthly basis for all reasonable legal and other expenses incurred in
connection with investigating or defending any such claim, action,
investigation, inquiry or other proceeding, notwithstanding the absence of a
judicial determination as to the propriety and enforceability of the Company's
obligation to reimburse the Underwriters for such expenses and the possibility
that such payments might later be held to have been improper by a court of
competent jurisdiction. Any such interim reimbursement payments that are not
made to an Underwriter within thirty (30) days of a request for reimbursement
shall bear interest at the prime rate (or reference rate or other commercial
lending rate for borrowers of the highest credit standing) published from time
to time by THE WALL STREET JOURNAL (the "Prime Rate") from the date of such
request. This indemnity agreement shall be in addition to any liabilities that
the Company may otherwise have. The Company will not, without the prior written
consent of each Underwriter, settle or compromise or consent to the entry of any
judgment in any pending or threatened action or claim or related cause of action
or portion of such cause of action in respect of which indemnification may be
sought hereunder (whether or not such Underwriter is a party to such action or
claim), unless such settlement, compromise or consent includes an unconditional
release of such Underwriter from all liability arising out of such action or
claim (or related cause of action or portion thereof).
-13-
The indemnity agreement in this Section 8(a) shall extend upon the same
terms and conditions to, and shall inure to the benefit of, each person, if any,
who controls any Underwriter within the meaning of the Act or the Exchange Act
to the same extent as such agreement applies to the Underwriters.
(b) Each Underwriter, severally, but not jointly, and in proportion to
their respective underwriting commitments, will indemnify and hold harmless the
Company against any losses, claims, damages or liabilities to which the Company
may become subject, under the Act, the Exchange Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any breach of any warranty or covenant by you
herein contained or any untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, the Registration
Statement or the Prospectus, or any amendment 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, in each case to the extent, but only to the extent, that
such untrue statement or alleged untrue statement or omission or alleged
omission was made in any Preliminary Prospectus, the Registration Statement or
the Prospectus or any such amendment or supplement thereto in reliance upon and
in conformity with written information furnished to the Company by such
Underwriter expressly for use therein; and will reimburse the Company for any
legal or other expenses reasonably incurred by the Company in connection with
investigating or defending any such loss, claim, damage, liability or action. In
addition to its other obligations under this Section 8(b), the Underwriters
agree that, as an interim measure during the pendency of any such claim, action,
investigation, inquiry or other proceeding arising out of or based upon any
statement or omission, or any alleged statement or omission, described in this
Section 8(b), they will reimburse the Company on a monthly basis for all
reasonable legal and other expenses incurred in connection with investigating or
defending any such claim, action, investigation, inquiry or other proceeding,
notwithstanding the absence of a judicial determination as to the propriety and
enforceability of their obligation to reimburse the Company for such expenses
and the possibility that such payments might later be held to have been improper
by a court of competent jurisdiction. Any such interim reimbursement payments
that are not made to the Company within 30 days of a request for reimbursement
shall bear interest at the Prime Rate from the date of such request. This
indemnity agreement shall be in addition to any liabilities that the
Underwriters may otherwise have.
The indemnity agreement in this Section 8(b) shall extend upon the same
terms and conditions to, and shall inure to the benefit of, each officer and
director of the Company and each person, if any, who controls the Company within
the meaning of the Act or the Exchange Act to the same extent as such agreement
applies to the Company.
(c) Promptly after receipt by an indemnified party under subsection (a)
or (b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; no indemnification provided for in Section 8(a) or 8(b)
shall be available to any party who shall fail to give notice as provided in
this Section 8(c) if the party to whom notice was not given was unaware of the
proceeding to which such notice would have related and was prejudiced by the
failure to give such notice, but the failure so to notify the indemnifying party
will not relieve the indemnifying party from any liability that it may have to
any indemnified party otherwise than under this Section 8. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party), except that if the
-14-
indemnified party has been advised by counsel in writing that there are one or
more defenses available to the indemnified party which are different from or
additional to those available to the indemnifying party, then the indemnified
party shall have the right to employ separate counsel and in that event the
reasonable fees and expenses of such separate counsel for the indemnified party
shall be paid by the indemnifying party; provided, however, that if the
indemnifying party is the Company, the Company shall only be obligated to pay
the reasonable fees and expenses of a single law firm (in addition to those of
its own counsel and any reasonably necessary local counsel) employed by all of
the indemnified parties and the persons referred to in Section 8(a) hereof. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment.
(d) It is agreed that any controversy arising out of the operation of
the interim reimbursement arrangements set forth in Section 8(a) and 8(b)
hereof, including the amounts of any requested reimbursement payments, the
method of determining such amounts and the basis on which such amounts shall be
apportioned among the indemnifying parties, shall be settled by arbitration
conducted pursuant to the Code of Arbitration Procedure of the National
Association of Securities Dealers, Inc. Any such arbitration must be commenced
by service of a written demand for arbitration or a written notice of intention
to arbitrate, therein electing the arbitration tribunal. In the event the party
demanding arbitration does not make such designation of an arbitration tribunal
in such demand or notice, then the party responding to said demand or notice is
authorized to do so. Any such arbitration will be limited to the operation of
the interim reimbursement provisions contained in Sections 8(a) and 8(b) hereof
and will not resolve the ultimate propriety or enforceability of the obligation
to indemnify for expenses that is created by the provisions of Sections 8(a) and
8(b).
(e) In order to provide for just and equitable contribution in
circumstances under which the indemnity provided for in this Section 8 is for
any reason judicially determined (by the entry of a final judgment or decree by
a court of competent jurisdiction and the expiration of time to appeal or the
denial of the right of appeal) to be unenforceable by the indemnified parties
although applicable in accordance with its terms, the Company, on the one hand,
and the Underwriters, on the other hand, shall contribute to the aggregate
losses, liabilities, claims, damages and expenses of the nature contemplated by
such indemnity incurred by the Company and one or more of the Underwriters, as
incurred, in such proportions that (a) the Underwriters are responsible for that
portion represented by the percentage that the underwriting discount appearing
on the cover page of the Prospectus bears to the initial public offering price
(before deducting expenses) appearing thereon, and (b) the Company is
responsible for the balance, provided, however, that 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; provided, further, that if the allocation provided
above is not permitted by applicable law, the Company, on the one hand, and the
Underwriters, on the other, shall contribute to the aggregate losses in such
proportion as is appropriate to reflect not only the relative benefits referred
to above but also the relative fault of the Company, on the one hand, and the
Underwriters, on the other, in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities, as well as any other
relevant equitable considerations. Relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission to state a material fact relates to
information supplied by the Company, on the one hand, or by the Underwriters, on
the other hand, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Underwriters agree that it would not be just and equitable
if contributions pursuant to this Section 8(e) were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method
-15-
of allocation which does not take account of the equitable considerations
referred to above in this Section 8(e). The amount paid or payable by a party as
a result of the losses, claims, damages or liabilities referred to above shall
be deemed to include any legal or other fees or expenses reasonably incurred by
such party in connection with investigating or defending such action or claim.
Notwithstanding the provisions of this Section 8(e), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. The Underwriters'
obligations in this Section 8(e) to contribute are several in proportion to
their respective underwriting obligations and not joint. For purposes of this
Section 8(e), each person, if any, who controls an Underwriter within the
meaning of Section 15 of the Act shall have the same rights to contribution as
such Underwriter, and each director of the Company, each officer of the Company
who signed the Registration Statement, and each person, if any, who controls the
Company within the meaning of Section 15 of the Act shall have the same rights
to contribution as the Company.
SECTION 9. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. All representations, warranties and agreements contained in this
Agreement, or contained in certificates of officers of the Company submitted
pursuant hereto, including indemnity and contribution agreements, shall remain
operative and in full force and effect, regardless of any termination of this
Agreement, or any investigation made by or on behalf of any Underwriter or any
person controlling any Underwriter by or on behalf of the Company or its
officers or directors, and shall survive acceptance and payment for the
Securities hereunder.
SECTION 10. EFFECTIVENESS OF AGREEMENT AND TERMINATION. This Agreement
shall become effective upon the later of (i) the execution and delivery hereof
by the parties hereto and (ii) such time after the Registration Statement
becomes effective as the Company may authorize the sale of the Securities to the
public by the Underwriters. By giving notice before the time this Agreement
becomes effective, you or the Company may prevent this Agreement from becoming
effective, without liability of any party to any other party, except that the
Company shall remain obligated to pay costs and expenses to the extent provided
in Section 7 hereof.
This Agreement may be terminated for any reason at any time prior to the
First Closing Date by you upon the giving of written notice of such termination
to the Company, if prior to the First Closing Date (i) there has been, since the
respective dates as of which information is given in the Registration Statement,
any material adverse change in the condition, financial or otherwise, earnings,
business affairs or business prospects of the Company, its Subsidiaries and the
Partnership, considered as a whole, whether or not arising in the ordinary
course of business, or (ii) there has occurred any outbreak or escalation of
hostilities or other calamity or crisis or material change in existing
financial, political, economic or securities market conditions, the effect of
which is such as to make it, in your judgment, impracticable or inadvisable to
market the Securities in the manner contemplated in the Prospectus or enforce
contracts for the sale of the Securities, or (iii) trading in the Common Stock
or Series A Preferred Stock of the Company has been suspended by the Commission
or the NASD or trading generally on either the American Stock Exchange or the
New York Stock Exchange or in the over-the-counter market has been suspended, or
minimum or maximum prices for trading have been fixed, or maximum ranges for
prices for securities have been required by either of said exchanges or the NASD
or by order of the Commission or any other governmental authority, or (iv) a
banking moratorium has been declared by Federal, New York or Tennessee
authorities, or (v) any Federal or state statute, regulation, rule or order of
any court or other governmental authority has been enacted, published, decreed
or otherwise promulgated which in your reasonable opinion materially adversely
affects or will materially adversely
-16-
affect the business or operations of the Company, its Subsidiaries and the
Partnership, taken as a whole, or (vi) any action has been taken by any
governmental authority in respect of its monetary or fiscal affairs which in
your reasonable opinion has a material adverse effect on the securities markets
in the United States. In the event of any such termination, the provisions of
Section 7, the indemnity agreement and contribution provisions set forth in
Section 8, and the provisions of Sections 9, 12 and 14 shall remain in effect.
SECTION 11. DEFAULT. If, on a Closing Date, any one or more of the
Underwriters shall fail or refuse to purchase Securities that it or they have
agreed to purchase hereunder on such date, and the aggregate principal amount of
Securities which such defaulting Underwriter or Underwriters agreed but failed
or refused to purchase is not more than one-tenth of the aggregate principal
amount of the Securities to be purchased on such date, the other Underwriters
shall be obligated severally in the proportions that the principal amount of
Securities set forth opposite their respective names in Schedule I bears to the
aggregate principal amount of Securities set forth opposite the names of all
such non-defaulting Underwriters, or in such other proportions as you may
specify, to purchase the Securities which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase on such date; PROVIDED
that in no event shall the principal amount of Securities that any Underwriter
has agreed to purchase pursuant to Section 3 be increased pursuant to this
Section 11 by an amount in excess of one-tenth of such principal amount of
Securities without the written consent of such Underwriter. If, on the Closing
Date, any Underwriter or Underwriters shall fail or refuse to purchase
Securities and the aggregate principal amount of Securities and the aggregate
principal amount of Securities with respect to which such default occurs is more
than one-tenth of the aggregate principal amount of Securities to be purchased
on such date, and arrangements satisfactory to you and the Company for the
purchase of such Securities are not made within 36 hours after such default,
this Agreement shall terminate without liability on the part of any
non-defaulting Underwriter or the Company. In any such case either you or the
Company shall have the right to postpone such Closing Date, but in no event for
longer than seven days, in order that the required changes, if any, in the
Registration Statement and in the Prospectus or in any other documents or
arrangements may be effected. Any action taken under this paragraph shall not
relieve any defaulting Underwriter from liability in respect of any default of
such Underwriter under this Agreement.
In the event there shall be only one Underwriter named in Schedule I
hereto, the foregoing provisions of this Section 11 shall have no force or
effect.
SECTION 12. NOTICES. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to you c/o Xxxxxx Xxxxxx & Company, Inc., 00
Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxx 00000, Attention: Xxxx Xxxxxx, Managing
Director; notices to the Company shall be directed to it at 000 Xxxxx Xxxxx
Xxxxxx, Xxxxxxx, Xxxxxxxxxxx 00000, Attention: Xxxx X. Xxxxxx, President.
SECTION 13. PARTIES. This Agreement shall inure to the benefit of and be
binding upon the Company, the Underwriters, any controlling persons referred to
herein and their respective successors and assigns. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any other
person, firm or corporation any legal or equitable right, remedy or claim under
or in respect of this Agreement or any provision herein contained. No purchaser
of Securities from any Underwriter shall be deemed to be a successor by reason
merely of such purchase.
-17-
SECTION 14. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS
OF THE STATE OF TENNESSEE.
This Agreement may be signed in two or more counterparts each of which
shall be an original, with the same effect as if the signatures thereto and
hereto were upon the same instrument.
-18-
If the foregoing is in accordance with your understanding of our
agreement, please sign this Agreement and return it to us.
Very truly yours,
XXXXXX PETROLEUM COMPANY
By___________________________
Name:
Title:
Confirmed and accepted as of the date first above written:
XXXXXX XXXXXX & COMPANY, INC.
By___________________________________
Name:
Title:
-19-
SCHEDULE I
PRINCIPAL AMOUNT
OF FIRM NOTES
UNDERWRITERS TO BE PURCHASED
-------------- -----------------
Xxxxxx Xxxxxx & Company, Inc............................ $15,000,000
-----------
Total.................................... $15,000,000
===========
SCHEDULE II
SUBSIDIARIES
NAME JURISDICTION OWNERSHIP (%)
---- ------------ -------------
Xxxxxx Petroleum Operating Company Delaware corporation 100%
Xxxxxx Offshore Production, Inc. Mississippi corporation 100% *
Mississippi Marketing, Inc. Mississippi corporation 100% *
Xxxxxx Exploration Company Mississippi corporation 100% *
-------------------------
* Wholly-owned subsidiary of Xxxxxx Petroleum Operating Company.