Exhibit 1.1
[FORM OF UNDERWRITING AGREEMENT]
$[ ]
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Companies, Inc.
$[ ] principal amount of [ ]% Senior Notes due [ ]
UNDERWRITING AGREEMENT
[Date]
[Date]
[Name of Representative]
For themselves and as Representative
of the other Underwriters named in
Schedule I hereto
c/o [Address for Representative]
Dear Sirs and Mesdames:
▇▇▇▇▇ & McLennan Companies, Inc., a Delaware corporation (the "Company"),
proposes to issue and sell to each of the Underwriters named in Schedule I
hereto (collectively, the "Underwriters") for whom [ ] is acting as
representative (in such capacity, the "Representative"), the principal amount
of its securities identified in Schedule II hereto (the "Notes"), to be issued
under an indenture dated as of June 14, 1999 (the "Original Indenture") and a
[ ] supplemental indenture relating to the Notes to be dated the Closing Date
(the "Supplemental Indenture", and, together with the Original Indenture, the
"Indenture"), between the Company, as issuer, and U.S. Bank National
Association (as successor to State Street Bank and Trust Company), as trustee
(the "Trustee").
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-[ ]) for the
registration of the offer and sale of certain securities, including the Notes,
from time to time in accordance with Rule 415 under the Securities Act of 1933,
as amended (the "Securities Act"), and the Company has filed such
post-effective amendments thereto as may be required prior to the date hereof.
Such registration statement, as so amended, has been declared effective by the
Commission, and the Indenture has been qualified under the Trust Indenture Act
of 1939, as amended (the "Trust Indenture Act"). Promptly after execution and
delivery of this Agreement, the Company will prepare and file a prospectus
supplement reflecting the terms of the Notes, the terms of the offering thereof
and the other matters set forth therein, pursuant to Rule 424(b) under the
Securities Act. The registration statement, in the form in which it became
effective and all post-effective amendments thereto, is herein called the
"Registration Statement". The prospectus in the form in which it appears in the
Registration Statement is hereinafter referred to as the "Basic Prospectus".
The term "Prospectus" means the Basic Prospectus together with the final
prospectus supplement (the "Prospectus Supplement") relating to the sale of the
Notes by the Underwriters
in the form first used to confirm sales of Notes. If the Company has filed an
abbreviated registration statement to register additional Notes or other debt
securities pursuant to Rule 462(b) under the Securities Act (the "Rule 462
Registration Statement"), then any reference herein to the term "Registration
Statement" shall be deemed to include such Rule 462 Registration Statement. Any
reference in this Agreement to the Registration Statement, any preliminary
prospectus, the Prospectus, the Basic Prospectus and the Prospectus Supplement
shall be deemed to refer to and include the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the Securities Act, as of the
date of this Agreement, and any reference to "amend", "amendment" or
"supplement" with respect to the Registration Statement, the Prospectus, the
Basic Prospectus and the Prospectus Supplement shall be deemed to refer to and
include any documents filed after such date under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), and the rules and regulations of the
Commission thereunder that are deemed to be incorporated by reference therein.
1. Representations and Warranties of the Company. The Company represents
and warrants to and agrees with the Representative that:
(i) The Registration Statement has become effective; no stop
order suspending the effectiveness of the Registration Statement is
in effect, and no proceedings for such purpose are pending before or,
to the knowledge of the Company, threatened by the Commission.
(ii) At the respective times the Registration Statement and any
post-effective amendments thereto became effective, at the date
hereof and at the Closing Date, the Registration Statement and any
amendments thereto did not, do not and will not contain any untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading, and complied, comply and will comply in all
material respects with the Securities Act and the applicable rules
and regulations of the Commission thereunder. At the date of the
Prospectus and at the Closing Date, neither the Prospectus nor any
amendment or supplement thereto contained or contains and, as amended
or supplemented, if applicable, will contain any untrue statement of
a material fact or omit to state a material fact necessary to make
the statements therein, in the light of the circumstances under which
they were made, not misleading, except that the representations and
warranties set forth in this paragraph do not apply to statements or
omissions in the Registration Statement or the Prospectus or any
amendment or supplement thereto based upon information relating to
the
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Underwriters furnished to the Company in writing by you expressly for
use therein.
(iii) The Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and
authority to own its property and to conduct its business as
described in the Prospectus and is duly qualified to transact
business and is in good standing in each jurisdiction in which the
conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to
be so qualified or be in good standing would not have a material
adverse effect on the Company and its subsidiaries, taken as a whole.
(iv) Each subsidiary of the Company listed on Schedule III
hereto, each a "Significant Subsidiary," has been duly incorporated,
is validly existing as a corporation in good standing under the laws
of the jurisdiction of its incorporation, has the corporate power and
authority to own its property and to conduct its business as
described in the Prospectus and is duly qualified to transact
business and is in good standing in each jurisdiction in which the
conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to
be so qualified or be in good standing would not have a material
adverse effect on the Company and its subsidiaries, taken as a whole;
except as described or incorporated by reference in or contemplated
by the Prospectus, all of the issued shares of capital stock of each
Significant Subsidiary of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable, and are
owned directly or indirectly by the Company, free and clear of all
liens, encumbrances, equities or claims.
(v) This Agreement has been duly authorized, executed and
delivered by the Company.
(vi) The authorized capital stock of the Company conforms as to
legal matters to the description thereof contained in the Prospectus.
All of the outstanding shares of capital stock of the Company have
been duly authorized and are validly issued, fully paid and
non-assessable.
(vii) The Original Indenture and the Supplemental Indenture have
each been duly and validly authorized by all
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necessary corporate action by the Company; the Original Indenture has
been duly executed and delivered by the Company and is, and upon the
due authorization, execution and delivery by the Trustee, the
Supplemental Indenture will be, each a valid, binding and enforceable
agreement of the Company, subject to applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance or
similar laws now or hereafter in effect affecting creditors' rights
generally and subject, as to enforceability, to general principles of
equity (regardless of whether enforcement is considered in a
proceeding in equity or at law). The Indenture has been duly
qualified under the Trust Indenture Act. The Notes and the Indenture
will conform, in each case in all material respects to the
descriptions thereof contained in the Prospectus.
(viii) The Notes have been duly and validly authorized by all
necessary corporate action by the Company and, when duly
authenticated and delivered by the Trustee against payment in
accordance with the terms of the Indenture and this Agreement, will
be valid, binding and enforceable obligations of the Company
(assuming the due authorization, execution and delivery of the
Indenture by the Trustee and the due authorization and delivery of
the Notes by the Trustee in accordance with the Indenture) and
entitled to the benefits of the Indenture, subject to applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance or similar laws now or hereafter in effect affecting
creditors' rights generally and subject, as to enforceability, to
general principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law). When duly executed,
authenticated, issued, delivered and paid for as provided herein and
in the Indenture, the Notes will constitute direct, general, senior,
unsecured and unconditional obligations of the Company and will rank
pari passu with all other present and future senior, unsecured
indebtedness of the Company (other than obligations preferred by
statute or operation of law).
(ix) The execution, delivery and performance by the Company of
this Agreement and the Indenture, the issuance, authentication, sale
and delivery of the Notes and compliance by the Company with the
terms thereof, and the consummation of the transactions contemplated
herein and therein, will not contravene any provision of applicable
law or the certificate of incorporation or by-laws of the Company or
any agreement or other instrument binding upon the Company or any of
its subsidiaries that is material to the Company and its
subsidiaries, taken as a whole, or
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any judgment, order or decree of any governmental body, agency or
court having jurisdiction over the Company or any subsidiary, except
for any such contraventions which, individually or in the aggregate,
would not have a material adverse effect on the Company and its
subsidiaries taken as a whole; and no consent, approval,
authorization or order of or qualification with, any governmental
body or agency is required for the execution, delivery and
performance by the Company of this Agreement or the Indenture, the
issuance, authentication, sale and delivery of the Notes and
compliance by the Company with the terms thereof, and the
consummation of the transactions contemplated by this Agreement or
the Indenture, except for the registration of the Notes under the
Securities Act, the qualification of the Indenture under the Trust
Indenture Act and such consents, approvals, authorizations, filings,
registrations or qualifications (A) which shall have been obtained or
made prior to the Closing Date and (B) as may be required to be
obtained or made under the Exchange Act and applicable state
securities laws in connection with the purchase and distribution of
the Notes by the Underwriters.
(x) There has not occurred any material adverse change in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a whole,
from that set forth in the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement).
(xi) To the knowledge of the Company, there are no legal or
governmental proceedings pending or threatened to which the Company
or any of its subsidiaries is a party or to which any of the
properties or assets of the Company or any of its subsidiaries is
subject that are required to be described in the Registration
Statement or the Prospectus and are not so described or any statutes,
regulations, contracts or other documents that are required to be
described in the Registration Statement or the Prospectus or to be
filed as exhibits to the Registration Statement that are not so
described or filed as required.
(xii) The Company is not, and after giving effect to the
offering and sale of the Notes and the application of the proceeds
thereof as described in the Prospectus will not be, or be required to
register as, an "investment company" as such term is defined in the
Investment Company Act of 1940, as amended.
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(xiii) There are no contracts, agreements or understandings
between the Company and any person granting such person the right to
require the Company to file a registration statement under the
Securities Act with respect to any securities of the Company; there
are no contracts, agreements or understandings between the Company
and any person granting such person the right to require the Company
to include such securities with the Notes registered pursuant to the
Registration Statement.
2. Agreements to Sell and Purchase. The Company hereby agrees to sell to
the Underwriters, and the Underwriters, severally and not jointly, upon the
basis of the representations and warranties herein contained, but subject to
the conditions hereinafter stated, agree to purchase from the Company at the
purchase price set forth in Schedule II hereto, the principal amount of Notes
set forth opposite such Underwriter's name in Schedule I hereto.
3. Terms of Public Offering. The Company is advised by you that the
Underwriters propose to make a public offering of the Notes. The Company is
further advised by you that the Notes are to be offered to the public on the
terms set forth in the Prospectus.
4. Payment and Delivery. Payment for the Notes shall be made to the
Company in Federal or other funds immediately available in New York City
against delivery of such Notes for the account of the Underwriters on the date
and at the time specified in Schedule II hereto, or at such time on such later
date not more than three Business Days after the foregoing date as the
Representative shall designate, which date and time may be postponed by
agreement between the Representative and the Company or as provided in Section
10 hereof (such date and time of delivery and payment for the Notes being
herein called the "Closing Date"). Delivery of the Notes shall be made to the
Representative against payment by the Underwriters of the purchase price
thereof to or upon the order of the Company by wire transfer payable in
same-day funds to an account specified by the Company. Delivery of the Notes
shall be made through the facilities of The Depository Trust Company unless the
Representative shall otherwise instruct.
5. Conditions to the Underwriters' Obligations. The obligations of the
Company to sell the Notes to the Underwriters and the obligation of the
Underwriters to purchase and pay for the Notes on the Closing Date are subject
to the conditions that the Registration Statement shall be effective on the
Closing Date, no stop order suspending the effectiveness of the Registration
Statement shall be in effect and no proceedings for that purpose shall be
pending before or threatened by the Commission.
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The obligation of the Underwriters is subject to the following further
conditions:
(a) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor shall any
notice have been given of any intended or potential downgrading or of
any review for a possible change with negative implications, in the
rating accorded any of the Company's securities by any "nationally
recognized statistical rating organization," as such term is defined
for purposes of Rule 436(g)(2) under the Securities Act; and
(ii) there shall not have occurred any change, or any
development involving a change, in the condition, financial or
otherwise, or in the earnings, business or operations of the Company
and its subsidiaries, taken as a whole, from that set forth in the
Prospectus (exclusive of any amendments or supplements thereto
subsequent to the date of this Agreement) that, in your judgment, is
material and adverse and that makes it, in your judgment,
impracticable to market the Notes on the terms and in the manner
contemplated in the Prospectus.
(b) The Representative shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer of
the Company, to the effect set forth in the first paragraph of this
Section 5, in Section 5(a), and to the effect that the representations and
warranties of the Company contained in this Agreement are true and correct
as of the Closing Date and that the Company has complied with all of the
agreements and satisfied all of the conditions on its part to be performed
or satisfied hereunder on or before the Closing Date.
The officer signing and delivering such certificate may rely upon the
best of his or her knowledge as to proceedings threatened.
(c) The Indenture shall have been duly and validly executed and
delivered by the Company and the Trustee.
(d) The Representative shall have received on the Closing Date an
opinion of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, general counsel for the Company, dated the
Closing Date, to the effect that:
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(i) the Company has been duly incorporated and is validly
existing and in good standing under the laws of the State of
Delaware;
(ii) the Company has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
under the laws of each jurisdiction in which it owns or leases
properties or conducts any business so as to require such
qualification, other than where the failure to be so qualified or in
good standing would not have a material adverse effect on the Company
and its subsidiaries taken as a whole;
(iii) each Significant Subsidiary of the Company has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of its jurisdiction of incorporation, with
corporate power and authority to own its properties and conduct its
business as described in the Prospectus; and, except as described or
incorporated by reference in or contemplated by the Prospectus, all
the issued shares of capital stock of each Significant Subsidiary
have been duly authorized and validly issued, are fully-paid and
non-assessable, and are owned by the Company, directly or indirectly,
free and clear of all liens, encumbrances, equities or claims;
(iv) the Company has the corporate power and corporate authority
to conduct its business and own its properties, in each case as
described in the Prospectus;
(v) the issuance and sale of the Notes have been duly authorized
by the Company and the Notes, when executed and authenticated in
accordance with the terms of the Indenture and delivered to and paid
for by the Underwriters in accordance with the terms of this
Agreement, will be valid and binding obligations of the Company
entitled to the benefits of the Indenture, and enforceable against
the Company in accordance with their terms, except to the extent that
enforcement thereof may be limited by (A) bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or similar laws now
or hereafter in effect relating to creditors' rights generally and
(B) general principles of equity (regardless of whether
enforceability is considered in a proceeding in equity or at law);
(vi) the Indenture has been duly authorized, executed and
delivered by the Company, and is a valid and binding agreement of the
Company, and enforceable against the Company
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in accordance with its terms, except to the extent that enforcement
thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or similar laws now or hereafter in
effect relating to creditors' rights generally and (B) general
principles of equity (regardless of whether enforceability is
considered in a proceeding in equity or at law). The Indenture has
been qualified under the Trust Indenture Act and the Notes and the
Indenture conform in all material respects to the descriptions
thereof contained in the Prospectus;
(vii) this Agreement has been duly authorized, executed and
delivered by the Company;
(viii) the execution, delivery and performance by the Company of
this Agreement and the Indenture, the issuance, authentication, sale
and delivery of the Notes and compliance by the Company with the
terms thereof, and the consummation of the transactions contemplated
herein and therein, will not conflict with or result in any violation
of any order of any court or governmental agency or body having
jurisdiction over the Company or any of its Significant Subsidiaries
or in a breach of any of the terms or provisions of, or constitute a
default under, any agreement or instrument required to be filed as an
exhibit to a form under the Exchange Act pursuant to Item 601 of
Regulation S-K, in each case to which the Company or any of its
Significant Subsidiaries is a party or by which the Company or any of
its Significant Subsidiaries is bound or to which any of the property
or assets of the Company or any of its Significant Subsidiaries is
subject, except for any such violations, breaches, conflicts or
defaults which individually or in the aggregate would not have a
material adverse effect on the Company and its subsidiaries taken as
a whole;
(ix) no Governmental Approval is required for the registration
of the Notes by the Company or the consummation by the Company of the
transactions contemplated by this Agreement and the Indenture, each
in accordance with the terms of this Agreement and the Indenture,
except such as have been made or obtained and except those which are
not required to be obtained, made or taken prior to the date hereof;
(x) other than as set forth or contemplated or incorporated by
reference in the Prospectus, there are no legal or governmental
proceedings pending or, to the knowledge of such
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counsel, overtly threatened to which the Company or any of its
Significant Subsidiaries is a party or to which any property of the
Company or any of its Significant Subsidiaries is or may be subject
which, individually or in the aggregate, would reasonably be expected
to have a material adverse effect on the business, operations or
condition, financial or otherwise, of the Company and its
subsidiaries taken as a whole; and such counsel does not know of any
contracts or other documents of a character required to be filed as
an exhibit to the Registration Statement or required to be described
in the Registration Statement or the Prospectus which are not filed
or described as required;
(xi) such counsel does not know of any right to require the
Company to register any securities for offering and sale under the
Securities Act by reason of the filing of the Registration Statement
with the Commission; such counsel does not know of any right to
require the Company to register any securities for offering and sale
under the Securities Act by reason of the sale of the Notes by the
Company;
(xii) the Company is not, and after giving effect to the
offering and sale of the Notes and the application of the proceeds
thereof as described in the Prospectus will not be, required to
register as an "investment company" as such term is defined in the
Investment Company Act of 1940, as amended;
(xiii) the statements in or incorporated by reference into the
Company's Annual Report on Form 10-K for the year ended December 31,
[ ] and the Company's Quarterly Report on Form 10-Q for the quarter
ended [ ] under "Regulation", "Legal Proceedings" and "Certain
Relationships and Related Transactions", insofar as such statements
constitute a summary of legal matters, documents or proceedings
referred to therein, fairly present in all material respects the
information called for with respect to such legal matters, documents
or proceedings;
(xiv) the statements in the Prospectus in the sections entitled
"Description of Debt Securities," "Description of Notes" and
"Underwriting" (to the extent that they relate to this Agreement),
have been reviewed by such counsel and fairly summarize the
provisions described in all material respects;
(xv) (A) the Registration Statement and the Prospectus, in each
case excluding the documents incorporated by reference therein, as of
their respective effective or issue date, complied as
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to form in all material respects with the requirements of the
Securities Act and (B) the documents incorporated by reference into
the Registration Statement, as of their respective dates of filing
with the Commission, complied as to form in all material respects
with the requirements of the Exchange Act (excluding in the case of
both clause (A) and (B) the financial statements, financial statement
schedules and other financial or statistical data included in or
excluded from such documents); and
(xvi) such counsel shall state that no facts have come to his
attention that has led him to believe that (except for the financial
statements, financial statement schedules and other financial or
statistical data included or incorporated by reference in the
Registration Statement or excluded therefrom or the exhibits thereto,
as to which such counsel need not express a belief) the Registration
Statement, at the time the Registration Statement became effective,
contained an untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make
the statements therein not misleading, or that the Prospectus, as of
its date and as of the Closing Date, contained or contains an untrue
statement of a material fact or omitted or omits to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
For purposes of the foregoing opinion, the term "Applicable Laws" means
the Delaware General Corporation Law and those laws, rules and regulations of
the State of New York and the United States of America that, in the experience
of such counsel, are normally applicable to transactions of the type
contemplated by this Agreement and the Indenture (but without such counsel
having made any special investigation concerning any other laws, rules or
regulations), provided that the term "Applicable Laws" does not include (1) any
federal or state securities or blue sky laws or (2) any anti-fraud laws. The
term "Governmental Authorities" means any New York or federal executive,
legislative, judicial, administrative or regulatory body under Applicable Laws
and the term "Governmental Approval" means any consent, approval, license,
authorization or validation of or filing, recording or registration with, any
Governmental Authority pursuant to Applicable Laws.
In giving the opinions set forth in paragraphs (xv) and (xvi) above, such
counsel may state that he does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement or Prospectus and has made no independent check or verification
thereof except as set forth in paragraphs (xiii) and (xiv).
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In rendering the opinions set forth above, such counsel (i) may state that
the opinion is limited to the General Corporation Law of the State of Delaware,
the laws of the State of New York and the federal laws of the United States and
(ii) may rely as to matters of fact, to the extent such counsel deems proper,
on certificates of responsible officers of the Company and certificates or
other written statements of officials or jurisdictions having custody of
documents respecting the corporate existence or good standing of the Company.
(e) The Representative shall have received on the Closing Date an
opinion of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the Underwriters, dated the
Closing Date, with respect to certain of the matters covered in subsection
(d) above and such other related matters as the Underwriters may
reasonably request, and such counsel shall have received such documents
and information as they may reasonably request to enable them to pass upon
such matters.
(f) The Representative shall have received on the Closing Date, a
letter dated the Closing Date, in form and substance satisfactory to the
Representative, from Deloitte & Touche LLP, independent public
accountants, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to Underwriters with respect to
the financial statements and certain financial information contained in
the Registration Statement and the Prospectus.
6. Covenants of the Company. In further consideration of the agreements of
the Underwriters herein contained, the Company covenants with the Underwriters
as follows:
(a) To make available to you, without charge, two signed copies of
the Registration Statement (including exhibits thereto) and to furnish to
you in New York City, without charge, prior to 10:00 a.m. New York City
time on the business day next succeeding the date of this Agreement and
during the period mentioned in Section 6(c) below, as many copies of the
Prospectus and any supplements and amendments thereto or to the
Registration Statement as you may reasonably request.
(b) In connection with the offering of the Notes, before amending or
supplementing the Prospectus to furnish to you a copy of each such
proposed amendment or supplement and not to file any such proposed
amendment or supplement to which you reasonably object, and to file with
the Commission within the applicable period specified in Rule 424(b) under
the Securities Act any prospectus required to be filed pursuant to such
Rule.
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(c) If, during such period after the first date of the public
offering of the Notes as in the opinion of counsel for the Underwriters
the Prospectus is required by law to be delivered in connection with sales
by the Underwriters or any dealer, any event shall occur or condition
exist as a result of which it is necessary to amend or supplement the
Prospectus in order to make the statements therein, in the light of the
circumstances when the Prospectus is delivered to a purchaser, not
misleading, or if, in the opinion of counsel for the Underwriters, it is
necessary to amend or supplement the Prospectus to comply with applicable
law, forthwith to prepare and subject to Section 6(b), file with the
Commission and furnish, at its own expense, to the Underwriters and to the
dealers (whose names and addresses you will furnish to the Company) to
which Notes may have been sold by you on behalf of the Underwriters and to
any other dealers upon request, either amendments or supplements to the
Prospectus so that the statements in the Prospectus as so amended or
supplemented will not, in the light of the circumstances when the
Prospectus is delivered to a purchaser, be misleading or so that the
Prospectus, as amended or supplemented, will comply with law.
(d) To endeavor to qualify the Notes for offer and sale under the
securities or Blue Sky laws of such jurisdictions as you shall reasonably
request.
(e) To make generally available to the Company's security holders and
to you as soon as practicable an earning statement covering the
twelve-month period ending [ ] that satisfies the provisions of
Section 11(a) of the Securities Act and the rules and regulations of the
Commission thereunder.
(f) Whether or not the transactions contemplated in this Agreement
are consummated or this Agreement is terminated, to pay or cause to be
paid all expenses incident to the performance of its obligations under
this Agreement, including: the fees, disbursements and expenses of the
Company's counsel and the Company's accountants in connection with the
registration and delivery of the Notes under the Securities Act and all
other fees or expenses in connection with the preparation and filing of
the Prospectus and amendments and supplements to any of the foregoing,
including all printing costs associated therewith, and the mailing and
delivering of copies thereof to the Underwriters and dealers, in the
quantities hereinabove specified, all costs and expenses related to the
transfer and delivery of the Notes to the Underwriters, including any
transfer or other taxes payable thereon, the cost of printing or producing
any Blue Sky memorandum in connection with the offer and sale of the Notes
under state securities laws and all expenses in connection with the
qualification of the Notes for offer and sale under state securities laws
as
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provided in Section 6(d) hereof, including filing fees and the reasonable
fees and disbursements of counsel for the Underwriters in connection with
such qualification and in connection with the Blue Sky memorandum, all
costs and expenses related to the listing of the Notes on the Luxembourg
Stock Exchange, all filing fees and the reasonable fees and disbursements
of counsel to the Underwriters incurred in connection with the review and
qualification of the offering of the Notes by the National Association of
Securities Dealers, Inc., the cost of printing the Notes, the costs and
charges of the Trustee, the costs and expenses of the Company relating to
investor presentations on any "road show" undertaken in connection with
the marketing of the offering of the Notes, including, without limitation,
expenses associated with the production of road show slides and graphics,
fees and expenses of any consultants engaged in connection with the road
show presentations with the prior approval of the Company, travel and
lodging expenses of the representatives and officers of the Company and
any such consultants, and the cost of any aircraft chartered in connection
with the road show and all other costs and expenses incident to the
performance of the obligations of the Company hereunder for which
provision is not otherwise made in this Section. It is understood,
however, that except as provided in this Section, Section 7 entitled
"Indemnity and Contribution", and the last paragraph of Section 9 below,
each Underwriter will pay all of its costs and expenses in connection with
the resale of any of the Notes by it and any advertising expenses
connected with any offers it may make.
7. Indemnity and Contribution. (a) The Company agrees to indemnify and
hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act, from and against any and all losses, claims,
damages and liabilities (including, without limitation, any legal or other
expenses reasonably incurred in connection with defending or investigating any
such action or claim) caused by any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or any
amendment thereof, any preliminary prospectus or the Prospectus or any
amendments or supplements thereto, or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, except insofar as such
losses, claims, damages or liabilities are caused by any such untrue statement
or omission or alleged untrue statement or omission based upon information
relating to any Underwriter furnished to the Company in writing by or on behalf
of any Underwriter through the Representative expressly for use therein and
except, that with respect to any Preliminary Prospectus, such indemnity shall
not inure to the benefit of any Underwriter (or the benefit of any person
controlling any Underwriter) if the person asserting any such losses,
liabilities, claims, damages or expenses purchased the Notes that are the
subject
14
thereof from any Underwriter and if such person was not sent or given a copy of
the Prospectus at or prior to confirmation of the sale of such Notes to such
person in any case where such sending or giving is required by the Securities
Act and the untrue statement or omission of a material fact contained in such
Preliminary Prospectus was corrected in the Prospectus, provided such
Prospectus was delivered to you in accordance with Section 6(a).
(b) Each Underwriter severally agrees to indemnify and hold harmless the
Company, its directors, its officers who signed the Registration Statement and
each person, if any, who controls the Company within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act to the same
extent as the indemnity contained in subsection (a) of this Section, but only
with reference to information relating to the Underwriters furnished to the
Company in writing by or on behalf of any Underwriter through the
Representative expressly for use in the Registration Statement, any preliminary
prospectus, the Prospectus or any amendments or supplements thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to Section 7(a) or Section 7(b), such person (the "indemnified
party") shall promptly notify the person against whom such indemnity may be
sought (the "indemnifying party") in writing and the indemnifying party, upon
request of the indemnified party, shall retain counsel reasonably satisfactory
to the indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding; but the failure so to
notify the indemnifying party will not, in any event, relieve the indemnifying
party from any obligations to any indemnified party other than the
indemnification obligation provided in paragraph (a) or (b) above. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel, (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of
both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them or (iii) the indemnifying party
failed to retain satisfactory counsel in a timely manner. It is understood that
the indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for the fees and expenses of more than one
separate firm (in addition to any local counsel) for all such indemnified
parties and that all such fees and expenses shall be reimbursed as they are
incurred. Any such separate firm for any Underwriter and such control persons
of such Underwriter shall be designated in writing by the Representative in the
case of parties indemnified pursuant to Section 7(a); and by
15
the Company, in the case of parties indemnified pursuant to Section 7(b). 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. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of any
pending or threatened proceeding in respect of which any indemnified party is
or could have been a party and indemnity could have been sought hereunder by
such indemnified party, unless such settlement includes an unconditional
release of such indemnified party from all liability on claims that are the
subject matter of such proceeding.
(d) To the extent the indemnification provided for in paragraph (a) or (b)
of this Section 7 is unavailable to an indemnified party or insufficient in
amount in respect of any losses, claims, damages or liabilities referred to
therein, then each indemnifying party under such paragraph, in lieu of
indemnifying such indemnified party thereunder, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages or liabilities in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Underwriters
on the other hand from the offering of the Notes or if the allocation provided
above is not permitted by applicable law, 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 of the Underwriters on the
other hand in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Underwriters on the other hand in connection with the offering of the
Notes shall be deemed to be in the same respective proportions as the net
proceeds from the offering of the Notes (before deducting expenses) received by
the Company and the total underwriting discounts and commissions received by
the Underwriters, in each case as set forth in the table on the cover of the
Prospectus, bear to the aggregate initial public offering price of the Notes as
set forth on such cover. The relative fault of the Company on the one hand and
the Underwriters on the other hand shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company or by the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
(e) The Company and the Underwriters agree that it would not be just or
equitable if contribution pursuant to this Section 7 were determined by pro
rata allocation or by any other method of allocation that does not take account
of the equitable considerations referred to in Section 7(d). The amount paid or
payable
16
by an indemnified party as a result of the losses, claims, damages and
liabilities referred to in the immediately preceding paragraph shall be deemed
to include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of Sections 7(d) and 7(e), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the Notes underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages that the Underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled
to contribution from any person who was not guilty of such fraudulent
misrepresentation. The remedies provided for in this Section 7 are not
exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity. The obligations of the
Underwriters in this subsection (e) and subsection (d) above, to contribute are
several in proportion to their respective underwriting obligations with respect
to such Notes and not joint.
(f) The indemnity and contribution provisions contained in this Section 7
and the representations, warranties and other statements of the Company
contained in this Agreement shall remain operative and in full force and effect
regardless of any termination of this Agreement, any investigation made by or
on behalf of the Underwriters or any person controlling the Underwriters or by
or on behalf of the Company, its officers or directors or any person
controlling the Company and acceptance of and payment for any of the Notes.
8. Termination. This Agreement shall be subject to termination by notice
given by you to the Company if after the execution and delivery of this
Agreement and prior to the Closing Date, (a) trading generally shall have been
suspended or materially limited on or by, as the case may be, any of the New
York Stock Exchange, the American Stock Exchange, the National Association of
Securities Dealers, Inc., the Chicago Board of Options Exchange, the Chicago
Mercantile Exchange or the Chicago Board of Trade, (b) trading of any
securities of the Company shall have been suspended on any exchange or in any
over-the-counter market, (c) a general moratorium on commercial banking
activities in New York shall have been declared by either Federal or New York
State authorities or (d) there shall have occurred any outbreak or escalation
of hostilities or any change in financial markets or any calamity or crisis
that, in your judgment, is material and adverse and, in the case of any of the
events specified in clauses (a) through (d), such event, singly or together
with any other such event, makes it, in your judgment, impracticable or
inadvisable to market the Notes on the terms and in the manner contemplated in
the Prospectus.
17
9. Defaulting Underwriters. (a) If any Underwriter shall default in its
obligations to purchase the Notes which it has agreed to purchase at the
Closing Date under this Agreement, the Representative may in its discretion
arrange for themselves or another party or other parties to purchase such Notes
on the terms contained herein. If within thirty-six hours after such default by
any Underwriter the Representative does not arrange for the purchase of such
Notes, then the Company shall be entitled to a further thirty-six hours within
which to procure another party or parties reasonably satisfactory to the
Representative to purchase such Notes on such terms. In the event that, within
the respective prescribed period, the Representative notifies the Company that
they have so arranged for the purchase of the Notes, or the Company notifies
the Representative that it has so arranged for the purchase of such Notes, the
Representative or the Company shall have the right to postpone the Closing Date
for a period of not more than seven days, in order to effect whatever changes
may thereby be made necessary in the Registration Statement or the Prospectus,
as amended or supplemented, or in any other documents or arrangements, the
Company agrees to file promptly any amendments or supplements to the
Registration Statement or the Prospectus which in the opinion of the
Representative may thereby be made necessary. The term "Underwriter" as used in
this Agreement shall include any person substituted under this Section with
like effect as if such person had originally been a party to this Agreement
with respect to such Notes.
(b) If, after giving effect to any arrangements for the purchase of the
Notes of a defaulting Underwriter or Underwriters by the Representative and the
Company as provided in subsection (a) above, the aggregate principal amount of
such Notes which remains unpurchased does not exceed one-eleventh of the
aggregate principal amount of the Notes to be purchased on the Closing Date,
then the Company shall have the right to require each non-defaulting
Underwriter to purchase the principal amount of Notes which such Underwriter
has agreed to purchase under this Agreement and, in addition, to require each
non-defaulting Underwriter to purchase its pro rata share (based on the
principal amount of Notes which such Underwriter agreed to purchase under this
Agreement) of the Notes of such defaulting Underwriter or Underwriters for
which such arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Notes of a defaulting Underwriter or Underwriters by the Representative and the
Company as provided in subsection (a) above, the aggregate principal amount of
Notes which remains unpurchased exceeds one-eleventh of the aggregate principal
amount of the Notes to be purchased on the Closing Date, as referred to in
subsection (b) above, or if the Company shall not exercise the right described
in subsection (b) above to require non-defaulting Underwriters to purchase the
Notes of a defaulting Underwriter or Underwriters, then this Agreement shall
thereupon terminate, without liability on the part of any non-defaulting
Underwriter or the
18
Company, except for the expenses to be borne by the Company and the
Underwriters as provided in Section 6 hereof and the indemnity and contribution
agreements in Section 7 hereof, but nothing herein shall relieve a defaulting
Underwriter from liability for its default.
10. Effectiveness. This Agreement shall become effective upon the
execution and delivery hereof by the parties hereto.
If this Agreement shall be terminated by the Underwriters because of any
failure or refusal on the part of the Company to comply with the terms or to
fulfill any of the conditions of this Agreement, or if for any reason the
Company shall be unable to perform its obligations under this Agreement, the
Company will reimburse the Underwriters for all out-of-pocket expenses
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
11. Counterparts. 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.
12. Applicable Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York, without giving
effect to the conflicts of laws provisions thereof.
13. Headings. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
19
Very truly yours,
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ COMPANIES, INC.
By:
--------------------------------
Name:
Title:
Confirmed and Accepted
as of the date hereof:
[NAME OF REPRESENTATIVE]
----------------------------------
Name:
Title:
For Themselves and As Representative of the other
Underwriters named in Schedule I hereto
20
SCHEDULE I
Principal Amount
of Notes due
Underwriter [ ]
----------- ----------------
[ ]........................................... $ [ ]
[ ]........................................... [ ]
[ ]........................................... [ ]
[ ]........................................... [ ]
================
Total................................................ $ [ ]
================
I-1
SCHEDULE II
Underwriting Agreement dated [ ]
Registration Statement No. 333-[ ]
Representative: [ ]
Title, Purchase Price and Description of Securities:
Title and Principal Amount:
$[ ] principal amount of [ ]% Senior Notes due [ ]
Purchase Price:
[ ]% of the principal amount of the notes due [ ]
Closing Date, Time and Location: [ ] at 10:00 A.M. (EST) at the offices
of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
II-1
SCHEDULE III
Significant Subsidiaries of ▇▇▇▇▇ & McLennan Companies, Inc.
1. ▇▇▇▇▇ Inc.
2. ▇▇▇▇▇▇, LLC
3. ▇▇▇▇▇▇ Inc.
III-1
