Exhibit 1.1
MIRANT CORPORATION
UNDERWRITING AGREEMENT
For Purchase of 5.75% Convertible Senior Notes due 2007
July 1, ▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ Securities LLC
▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Credit Suisse First Boston Corporation
Eleven ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
As Representatives of the several Underwriters
Listed on Schedule A hereto
Ladies and Gentlemen:
Mirant Corporation, a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions stated herein, to issue and sell
to Banc of America Securities LLC, Credit Suisse First Boston Corporation and
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc., as representatives (the "Representatives") of the
several Underwriters listed on Schedule A hereto (collectively, the
"Underwriters"), $370,000,000 aggregate principal amount of 5.75% Convertible
Senior Notes due 2007 (the "Firm Securities"), convertible into shares of common
stock, $.01 par value per share (the "Common Stock"), of the Company.
The Company also proposes to grant to the Underwriters an
option to purchase up to an additional $55,500,000 aggregate principal amount of
5.75% Convertible Senior Notes due 2007 to cover over-allotments (the "Optional
Securities"); the Optional Securities, together with the Firm Securities, being
hereinafter called the "Securities."
The Securities will be issued pursuant to an Indenture, dated
as of July 8, 2002 (the "Indenture"), between the Company, as issuer, and
Deutsche Bank Trust Company Americas, as trustee (the "Trustee").
1. Registration Statement and Prospectus: The Company prepared and
filed with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations of the Commission thereunder (collectively, the
"Act"), a registration statement on Form S-3 (Registration No. 333-64158) under
the Act (the "Registration Statement"), including the combined prospectus
therein relating to debt securities, preferred stock, depositary shares, common
stock and associated preferred stock purchase rights, warrants, stock purchase
contracts and stock purchase units. The term "Registration Statement" as used in
this Agreement means the registration statement (including all financial
schedules and exhibits, including those exhibits incorporated by reference, but
excluding Forms T-1), as amended at the time it became effective, and as
supplemented or amended prior to the execution of this Agreement, including such
documents that are, or are deemed to be, incorporated by reference therein. The
term "Prospectus" as used in this Agreement means the prospectus in the form
included in the Registration Statement, as supplemented by a prospectus
supplement specifying the terms and plan of distribution of the Securities, as
filed with the Commission pursuant to Rule 424(b) under the Act. The date of the
Prospectus shall herein refer to the date of the prospectus supplement. The term
"Preliminary Prospectus" as used in this Agreement means any prospectus used
that omitted information in reliance on Rule 430A to be included upon pricing in
a form of prospectus filed with the Commission pursuant to Rule 424(b) under the
Act and was used after the effectiveness of the Registration Statement and prior
to the execution and delivery of this Agreement.
2. Purchase and Sale: Subject to the terms and conditions herein set
forth, (a) the Company agrees to issue and sell to the Underwriters, and the
Underwriters agree, severally and not jointly, to purchase from the Company, at
a purchase price per Security of $975.00, the respective principal amounts of
Firm Securities set forth opposite their names on Schedule A hereto and (b) in
the event and to the extent that the Underwriters shall exercise the election to
purchase Optional Securities as provided below, the Company agrees to issue and
sell to the Underwriters, and the Underwriters agree, severally and not jointly,
to purchase from the Company, at the purchase price per Security set forth in
this Section 2, that portion of the number of Optional Securities as to which
such election shall have been exercised.
The Company hereby grants to the Underwriters the right to purchase at
their election up to $55,500,000 aggregate principal amount of Optional
Securities, at the purchase price per Security set forth in the paragraph above,
for the purpose of covering sales of securities in excess of the Firm
Securities. Any such election to purchase Optional Securities may be exercised
only by written notice from you to the Company, given from time to time within a
period of 30 calendar days after the date of this Agreement, setting forth the
aggregate number of Optional Securities to be purchased and the date on which
such Optional Securities are to be delivered, as determined by you but in no
event earlier than the First Time of Delivery (as defined in Section 4 hereof)
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.
3. Offer of Securities: The Company has been advised by you that you
2
propose to make an offering of the Securities on the terms and subject to the
conditions and in the manner set forth in the Prospectus.
4. Payment and Delivery:
(a) The Securities to be purchased by the Underwriters hereunder,
in definitive or electronic form, and in such authorized
denominations and registered in such names as the
Representatives may request upon at least forty-eight hours'
prior notice to the Company, shall be delivered by or on
behalf of the Company to the Representatives, through the
facilities of The Depository Trust Company ("DTC"), for the
respective accounts of the Underwriters, against payment by or
on behalf of the respective Underwriters of the purchase price
therefor by wire transfer of Federal (same-day) funds to the
account specified by the Company to the Representatives at
least forty-eight hours in advance. The Company will
cause the certificates representing the Securities to be made
available for checking and packaging at least twenty-four
hours prior to the Time of Delivery (as defined below) with
respect thereto at the office of Shearman & Sterling,
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇. The time and
date of such delivery and payment shall be, with respect
to the Firm Securities, 9:30 a.m., New York, New York time,
on July 8, 2002 or such other time and date as the
Representatives and the Company may agree upon in writing,
and, with respect to the Optional Securities, 9:30 a.m., New
York time, on the date specified by the Representatives
in the written notice given by the Representatives of their
election to purchase such Optional Securities, or such other
times and dates as the Representatives and the Company may
agree upon in writing. Such time and date for delivery of the
Firm Securities is herein called the "First Time of
Delivery," such times and dates for delivery of the Optional
Securities, if not the First Time of Delivery, is herein each
called an "Option Time of Delivery," and each such time and
date for delivery is herein called a "Time of Delivery."
(b) The documents to be delivered at each Time of Delivery by or
on behalf of the parties hereto pursuant to Section 5(b)
hereof, including the cross receipt for the Securities and any
additional documents requested by the Representatives pursuant
to Section 5(b)(v) hereof, will be delivered at the offices of
Shearman & Sterling, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇ (the "Closing Location"), all at such Time of Delivery.
A meeting will be held at the Closing Location at 1:00 p.m.,
New York, New York time, on the Business Day immediately
preceding such Time of Delivery, at which meeting the final
drafts of the documents to be delivered pursuant to the
preceding sentence will be available for review by the parties
hereto. For the purposes of this Section 4, "Business Day"
shall mean each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which banking institutions in New
York, New York or Atlanta, Georgia are generally authorized or
obligated by law or executive order to close.
5. Conditions of Underwriters' Obligations: The obligations of the
Underwriters hereunder to purchase the Firm Securities and the Optional
3
Securities, respectively, are subject to the accuracy of the representations and
warranties on the part of the Company herein contained at the First Time of
Delivery and each Option Time of Delivery, respectively, and to the following
other conditions:
(a) The Prospectus and the Preliminary Prospectus (if necessary) shall
have been filed with the Commission pursuant to Rule 424(b) within the
applicable time period prescribed for such filing by the rules and
regulations under the Act and in accordance with Section 6(a) hereof;
no stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no proceeding
for that purpose shall have been initiated or threatened by the
Commission; and all requests for additional information on the part of
the Commission shall have been complied with to your reasonable
satisfaction.
(b) That, at such Time of Delivery, the Representatives shall be furnished
the following opinions and letters, with such changes therein as may
be agreed upon by the Company and the Representatives.
(i) Opinion of ▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, counsel to the Company,
and opinion of Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, special
tax counsel to the Company, substantially in the form attached
hereto as Exhibit 1a and 1b, respectively.
(ii) Opinion of Shearman & Sterling, counsel to the Underwriters,
substantially in the form attached hereto as Exhibit 2. (iii) On
the date hereof, KPMG LLP shall have furnished to the
Representatives a letter, dated the date hereof, substantially in
the form attached hereto as Exhibit 3.
(iv) A letter dated as of each Time of Delivery from KPMG LLP, which
shall confirm the statements made in the letter dated the date
hereof from KPMG LLP being delivered to the Representatives
pursuant to clause (iii) above, in form and substance
satisfactory to the Representatives.
(v) Such documents relating to the Company's corporate existence and
its authorization and execution of this Agreement, as the
Representatives may reasonably request.
(c) That, prior to such Time of Delivery, there shall have been no
material adverse change, or any development reasonably expected to
result in a material adverse change, in the business, properties or
financial condition of the Company from that set forth in or
contemplated by the Prospectus, and that the Company shall, at such
Time of Delivery, have delivered to the Representatives a certificate
to such effect of an executive officer of the Company.
(d) The Company has obtained and delivered to the Representatives executed
copies of a lock-up agreement, attached as Annex A hereto, from each
of the executive officers who are members of the Company's Management
4
Council and each director that owns 50,000 or more shares of the
Company's Common Stock (including non-convertible economic interests),
addressed to the Representatives.
(e) That the Company shall have performed such of its obligations under
this Agreement as are to be performed at or prior to such Time of
Delivery by the terms hereof.
6. Certain Covenants of the Company: In further consideration
of the agreements of the Underwriters herein contained, the Company covenants as
follows:
(a) To prepare the Prospectus and to file such Prospectus pursuant to Rule
424(b) under the Act not later than the Commission's close of business
on the second business day following the execution and delivery of
this Agreement; to furnish to each Representative one manually signed
copy of the Registration Statement and all amendments thereto; to
advise the Representatives promptly after it receives notice thereof,
of the issuance by the Commission of any stop order or of any order
preventing or suspending the use of any Preliminary Prospectus or
Prospectus, of the suspension of the qualification of the Securities
for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of any request
by the Commission for the amending or supplementing of the
Registration Statement or Prospectus or for additional information;
and, in the event of the issuance of any stop order or of any order
preventing or suspending the use of any Preliminary Prospectus or
Prospectus or suspending any such qualification, promptly to use
reasonable efforts to obtain the withdrawal of such order.
The Company will furnish to the Underwriters, without charge, as
many copies of the Preliminary Prospectus and Prospectus (as
supplemented or amended if the Company shall have made any supplements
or amendments thereto) as the Underwriters may reasonably request.
(b) If, in the opinion of counsel to the Underwriters, the delivery of a
prospectus is required under the Act at any time prior to the
expiration of nine months after the time of issue of the Prospectus in
connection with the offering or sale of the Securities and if at such
time any event shall have occurred as a result of which the Prospectus
as then amended or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein, in light of the circumstances under which the
statements are made when such Prospectus is delivered, not misleading,
or if, for any other reason, it shall be necessary during such period
to amend or supplement the Prospectus in order to comply with the Act,
to notify the Representatives and upon the Representatives' request to
forthwith amend or supplement the Prospectus by furnishing, at its own
expense, to the Underwriters and to dealers (whose names and addresses
are furnished to the Company by the Representatives) to whom
5
Securities may have been sold by any Underwriter and, upon request, to
any other dealers making such request, as many copies as the
Underwriters may from time to time reasonably request of an amended
Prospectus or supplements thereto so that the statements in the
Prospectus as so amended or supplemented will not, in light of the
circumstances under which the statements are made, be misleading. If,
in the opinion of counsel to the Underwriters, the delivery of a
prospectus is required under the Act in connection with sales of any
of the Securities at any time nine months or more after the time of
issue of the Prospectus, at the Representatives' request, but at the
expense of the Underwriters, the Company will prepare and deliver to
each Underwriter as many copies as such Underwriter may request of an
amended or supplemented Prospectus complying with Section 10(a)(3) of
the Act.
(c) During such time as the Underwriters are required to deliver a
Prospectus pursuant to Section 5 of the Act, the Company will prepare
and file with the Commission the documents required to be filed
pursuant to Sections 13 and 14 of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), and the rules and regulations of the
Commission promulgated thereunder.
(d) To make generally available to its security holders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule
158(c) under the Act), an earnings statement of the Company and its
subsidiaries (which need not be audited) complying with Section 11(a)
of the Act and the rules and regulations thereunder (including, at the
option of the Company, Rule 158).
(e) The Company will cooperate with the Underwriters to qualify the
Securities for offer and sale under the securities or "blue sky" laws
of such states and other jurisdictions as the Representatives may
reasonably request and to pay filing fees, reasonable attorneys' fees
and disbursements in connection therewith in an amount not exceeding
$15,000 in the aggregate (including filing fees and disbursements paid
or incurred prior to the date this Agreement becomes effective);
provided, however, that the Company shall not be required to qualify
-------- -------
as a foreign corporation or to file a consent to service of process
or to file annual reports or to comply with any other requirements
deemed by the Company to be unduly burdensome.
(f) The Company will pay all costs and expenses incident to the
performance of the obligations of the Company under this Agreement,
including (i) the preparation of the Preliminary Prospectus, the
Prospectus (including financial statements) and any amendments or
supplements thereto, (ii) the preparation and printing of the
Securities certificates, (iii) the issuance and delivery of the
Securities to the Underwriters (other than transfer taxes), (iv) the
furnishing of the opinions, letter and certificate referred to in
Section 5(b) hereof (other than the opinion referred to in Section
5(b)(ii) hereof) and (v) the fees and expenses of the Trustee. It is
6
understood that the Underwriters shall be solely responsible to pay
all fees and expenses of counsel to the Underwriters, and that the
Company shall not be liable to reimburse the Underwriters for such
fees and expenses.
(g) If the Underwriters shall not take up and pay for the Securities, due
to the failure of the Company to comply with any of the conditions
specified in Section 5 hereof, the Company shall reimburse the
Underwriters for all of their reasonable out-of-pocket accountable
expenses incurred in connection with the financing contemplated by
this Agreement.
(h) During a period of 60 days from the date of the Prospectus, the
Company will not, without the prior written consent of the
Representatives, offer or sell (or grant any option or warrant to
offer or sell) any Securities or Common Stock of the Company or any
security convertible into or exchangeable for the Securities or Common
Stock of the Company or any securities substantially similar to the
Securities or shares of Common Stock of the Company; provided,
--------
however, that the foregoing shall not apply to any securities issuable
-------
pursuant hereto or the issuance, offer, sale or grant of securities or
options or warrants to purchase any securities pursuant to any trading
plan or employee compensation or stock purchase plans or director
compensation plans described in the Registration Statement (or any
transaction pursuant to which the Company ▇▇▇▇▇▇ its obligations under
any such employee compensation or stock purchase plans or director
compensation plans) or any issuance or offer of securities (or options
or warrants to purchase any securities) as consideration in connection
with an acquisition (whether by merger or otherwise) by the Company,
provided that the recipients of those securities, in connection with
the acquisition, agree to be locked-up on similar terms for the
remainder of such 60-day period. Further, the Company will ensure that
shares acquired under the Employee Savings Plan which are sold by the
officers and directors who are party to lock-up agreements pursuant to
Section 5(d) of this Agreement do not exceed an aggregate of 2 million
shares of Common Stock.
7. Warranties of and Indemnity by the Company:
(a) The Company warrants and represents to each of the Underwriters that:
(i) The Company has filed with the Commission the Registration
Statement and the Registration Statement has been declared
effective under the Act.
(ii) (A) The Registration Statement, at its effective date and on the
date of filing of the Company's Annual Report on Form 10-K for
the year ended December 31, 2001 (the "10-K Filing Date"),
conformed with, and the Prospectus and any further amendments or
supplements to the Registration Statement and the Prospectus will
conform, in all material respects, to the requirements of the Act
and the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act") and the rules and regulations of the Commission
thereunder, (B) each document incorporated by reference into the
7
Prospectus, at the time originally filed with the Commission
pursuant to the Exchange Act, conformed with, and will conform,
in all material respects, to the requirements of the Exchange
Act, and (C) the Registration Statement, at its effective date
and the 10-K Filing Date, did not, and the Prospectus and any
amendment or supplement thereto, as of any applicable filing date
as to the Prospectus and any amendment or supplement thereto,
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 (with respect to
statements in the Prospectus, or the Prospectus as amended or
supplemented, in the light of the circumstances under which they
were made) not misleading; provided, however, that this
-------- -------
representation and warranty shall not apply to (x) that part of
the Registration Statement that shall constitute the Statements
of Eligibility (Form T-1) (collectively, the "Form T-1") under
the Trust Indenture Act or (y) any statements or omissions made
in reliance upon and in conformity with information furnished in
writing to the Company by the Representatives expressly for use
therein.
(iii)The Company is a corporation duly organized and validly existing
under the laws of Delaware and has all requisite corporate power
and authority to execute, deliver and perform its material
obligations under this Agreement, the Indenture and the
Securities.
(iv) The Securities have been duly authorized and, when executed and
delivered by the Company, authenticated by the Trustee in
accordance with the terms of the Indenture and delivered to and
paid for by you in accordance with the terms of the Underwriting
Agreement, will be the legal, valid and binding obligations of
the Company, enforceable against the Company in accordance with
their terms, subject to the effect of any applicable bankruptcy,
insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or other
similar laws relating to or affecting enforcement of creditors'
generally and general principles of equity (regardless of whether
the issue of enforceability is considered in a proceeding in
equity or at law).
(v) This Agreement has been duly authorized, executed and delivered
by the Company.
(vi) The Indenture has been duly authorized and, when executed and
delivered by the Company and the Trustee, will be the legal,
valid and binding obligations of the Company, enforceable against
the Company in accordance with its terms, subject to the effect
of any applicable bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers),
reorganization, moratorium or other similar laws relating to or
affecting enforcement of creditors' generally and general
principles of equity (regardless of whether the issue of
enforceability is considered in a proceeding in equity or at
law).
8
(vii)The shares of Common Stock issuable upon conversion of the
Securities, when issued and delivered by the Company in
accordance with the terms of the Securities, will be duly
authorized, validly issued, fully paid and non-assessable and
will not be subject to preemptive or similar rights under (A) the
statutes, judicial and administrative decisions, and the rules
and regulations of the governmental agencies of the State of
Delaware, (B) the Company's Certificate of Incorporation or
By-laws, or (C) any instrument, document, contract or other
agreement filed as an exhibit to the Registration Statement or
filed as an exhibit to any documents incorporated by reference
therein.
(viii) Other than as set forth in the Prospectus, no litigation,
arbitration or administrative proceeding is currently pending or,
to the knowledge of the Company, threatened against it, which
would reasonably be expected to have a material adverse effect on
the business, properties or financial condition of the Company.
(ix) The Company is not in violation of its Certificate of
Incorporation or By-laws or in default in the performance or
observance of any obligation, agreement, covenant or condition
contained in any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which it is
a party or by which it or any of its properties may be bound that
would have a material adverse effect on the business, financial
condition, results of operations of the Company and its
subsidiaries, taken as a whole.
(x) The financial statements included or incorporated by reference in
the Preliminary Prospectus or the Prospectus, together with the
related schedules and notes, present fairly the financial
position of the Company and its consolidated subsidiaries as of
the dates shown and their results of operations and cash flows
for the periods shown, and such financial statements have been
prepared in conformity with generally accepted accounting
principles in the United States applied on a consistent basis,
except as noted in the notes thereto.
(b) The Company agrees to indemnify and hold harmless each of the
Underwriters and each person, if any, who controls any such
Underwriter within the meaning of Section 15 of the Act against any
and all losses, claims, damages or liabilities, joint or several, to
which they or any of them may become subject under the Act or
otherwise, and to reimburse the Underwriters and such controlling
person or persons, if any, for any legal or other expenses incurred by
them in connection with investigating or defending any actions,
insofar as such losses, claims, damages, liabilities or actions arise
out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Preliminary Prospectus
or the Prospectus, as amended or supplemented, or arise out of or are
based upon any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
9
statements therein (with respect to statements in the Preliminary
Prospectus or the Prospectus, as amended or supplemented, in the light
of the circumstances under which they were made) not misleading,
except insofar as such losses, claims, damages, liabilities or actions
arise out of or are based upon any such untrue statement or omission
or alleged untrue statement or omission which was made in such
Preliminary Prospectus or Prospectus, as amended or supplemented, in
reliance upon and in conformity with information furnished in writing
to the Company by the Underwriters for use therein and except that
this indemnity with respect to the Preliminary Prospectus, and with
respect to the Prospectus, if the Company shall have furnished any
amendment or supplement thereto, shall not inure to the benefit of any
Underwriter (or of any person controlling such Underwriter) on account
of any losses, claims, damages, liabilities or actions arising from
the sale of Securities to any person if a copy of the Preliminary
Prospectus or the Prospectus, as the same may then be amended or
supplemented, after having been supplied in the quantities requested
by the Underwriters from the Company and with sufficient time to
effect a recirculation, shall not have been sent or given by or on
behalf of such Underwriter to such person with or prior to the written
confirmation of the sale involved and if the Preliminary Prospectus or
the Prospectus (as so amended or supplemented) would have corrected
the defect giving rise to such loss, liability, claim or damage.
The Company's indemnity agreement contained in this Section 7(b), and
its covenants, warranties and representations contained in this Agreement,
shall remain in full force and effect regardless of any investigation made
by or on behalf of any Underwriter or controlling person, and shall survive
the delivery of and payment for the Securities hereunder.
8. Indemnity by Underwriters: Each Underwriter severally agrees to
indemnify and hold harmless the Company, its directors and officers, and each
person, if any, who controls the Company within the meaning of Section 15 of the
Act, to the same extent and upon the same terms as the indemnity agreement of
the Company set forth in Section 7(b) hereof, but only with respect to untrue
statements or omissions or alleged untrue statements or omissions in the
Preliminary Prospectus, the Prospectus or the Prospectus as amended or
supplemented, made in reliance upon and in conformity with information furnished
in writing to the Company by the Underwriters for use therein.
The indemnity agreement on the part of each Underwriter contained in
this Section 8 shall remain in full force and effect regardless of any
investigation made by or on behalf of the Company or other Underwriter or
controlling person, and shall survive the delivery of and payment for the
Securities hereunder.
9. Procedures Relating to Indemnification: Promptly after receipt by
a party indemnified under Section 7 or 8 above of written notice of any loss,
claim, damage or liability in respect of which indemnity may be sought by it
hereunder, such indemnified party will, if a claim is to be made against an
indemnifying party, notify the indemnifying party thereof in writing, but the
10
omission so to notify the indemnifying party will not relieve the indemnifying
party from any liability (otherwise than under Section 7 or 8 hereof, as the
case may be) which it may have to the indemnified party. Thereafter, the
indemnified party and the indemnifying party shall consult, to the extent
appropriate, with a view to minimizing the cost to the indemnifying party of its
obligations hereunder. In case any indemnified party receives written notice of
any loss, claim, damage or liability in respect of which indemnity may be sought
by it hereunder and it notifies the indemnifying party thereof, the indemnifying
party will be entitled to participate therein, and, to the extent that it may
elect by written notice delivered to the indemnified party promptly after
receiving the aforesaid notice from the indemnified party, to assume the defense
thereof with counsel reasonably satisfactory to the indemnified party; provided,
--------
however, that if the parties against which any loss, claim, damage or liability
-------
arises include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that the defenses available to
it create a conflict of interest for the counsel selected by the indemnifying
party under the code of professional responsibility applicable to such counsel,
the indemnified party shall have the right to select one separate counsel to
assume such legal defenses and otherwise to participate in the defenses of such
loss, claim, damage or liability on behalf of the indemnified party. Upon
receipt by the indemnified party of notice from the indemnifying party of its
election so to assume the defense of such loss, claim, damage or liability and
approval by the indemnified party of counsel, the indemnifying party shall not
be liable to the indemnified party under Section 7 or 8 hereof, as the case may
be, for any legal or other expenses subsequently incurred by the indemnified
party in connection with the defense thereof unless (i) the indemnified party
shall have employed such counsel in connection with the assumption of legal
defenses in accordance with the proviso to the next preceding sentence, (ii) the
indemnifying party shall not have employed and continued to employ counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party within a reasonable time after notice of commencement of the action, (iii)
the indemnified party shall have reasonably concluded that there may be legal
defenses which are available to it which are different from and conflict with
those available to the indemnifying party, or (iv) the indemnifying party shall
have authorized in writing the employment of separate counsel for the
indemnified party at the expense of the indemnifying party. No indemnifying
party shall, without prior written consent of the indemnified party, effect any
settlement of any pending or threatened action in respect of which the
indemnified party is or is entitled or subject to be a party and the indemnified
party is entitled to indemnity hereunder unless such settlement (i) includes an
unconditional release of the indemnified party from all liability on any claims
that are the subject matter of such action and (ii) does not require any
admission or acknowledgement of culpability or wrongdoing on behalf of an
indemnified party. No indemnifying party shall be liable for any settlement,
compromise or consent to the entry of any order adjudicating or otherwise
disposing of any loss, claim, damage or liability effected without its written
consent.
If the indemnification provided for under Section 7 or 8 above is
unavailable to or insufficient to hold harmless an indemnified party in respect
of any losses, claims, damages or liabilities (or actions in respect thereof)
that would otherwise have been indemnified under the terms of such indemnity,
then each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) 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 from the offering of the Securities. If, however, the
11
allocation provided by the immediately preceding sentence is not permitted by
applicable law or if the indemnified party failed to give the notice required
above, then each indemnifying party shall contribute to such amount paid or
payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company on the one hand and the Underwriters on the other in connection with the
statements or omissions which resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other relevant
equity considerations. The relative benefits received by the Company on the one
hand and the Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering (before deducting
expenses) received by the Company bear to the total compensation received by the
Underwriters in respect of underwriting discounts and commissions as set forth
in the table on the cover page of the Prospectus. The 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 or alleged omission to state
a material fact relates to information supplied by the Company on the one hand
or the Underwriters on the other 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 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above in this section. The amount paid
or payable by an indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to above in this section
shall be deemed to include 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 this section, 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. 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.
10. Substitution of Underwriters:
(a) If any Underwriter under this Agreement shall fail or refuse
(whether for some reason sufficient to justify, in accordance
with the terms hereof, the termination of its obligations to
purchase or otherwise) to purchase the Securities which it has
agreed to purchase, the Company shall immediately notify the
remaining Underwriters and the remaining Underwriters may, within
24 hours of receipt of such notice, procure some other
responsible party or parties satisfactory to the Company, who may
include one or more of the remaining Underwriters, to purchase or
agree to purchase such Securities on the terms herein set forth;
and, if the remaining Underwriters shall fail to procure a
satisfactory party or parties to purchase or agree to purchase
such Securities on such terms within such period after the
receipt of such notice, then the Company shall be entitled to an
additional period of 24 hours within which to procure another
party or parties to purchase or agree to purchase such Securities
on the terms herein set forth. In any such case, either the
12
remaining Underwriters or the Company shall have the right to
postpone the First Time of Delivery for a period not to exceed
five business days from the date set forth in Section 4 hereof,
in order that the necessary changes to the Prospectus and any
other documents and arrangements may be effected. 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 Securities.
(b) If, after giving effect to any arrangements for the purchase of
the Securities of a defaulting Underwriter or Underwriters by the
Underwriters and the Company as provided in subsection (a) above,
the aggregate number of such Securities which remains unpurchased
does not exceed one-tenth of the aggregate number of all the
Securities to be purchased at such Time of Delivery, then the
Company shall have the right to require each non-defaulting
Underwriter to purchase the number of Securities which such
Underwriter agreed to purchase hereunder at such Time of Delivery
and, in addition, to require each non-defaulting Underwriter to
purchase its pro rata share (based on the number of Securities
which such Underwriter agreed to purchase hereunder) of the
Securities 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.
If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Underwriter or Underwriters by the
Underwriters and the Company as provided in subsection (a) above, the
aggregate number of such Securities which remains unpurchased exceeds
one-tenth of the aggregate number of all the Securities to be purchased
at such Time of Delivery, or if the Company shall not exercise the
right described in subsection (b) above to require non-defaulting
Underwriters to purchase Securities of a defaulting Underwriter or
Underwriters, then this Agreement (or, with respect to any Option Time
of Delivery, the obligations of the Underwriters to purchase and of the
Company to sell the applicable Optional Securities) shall thereupon
terminate, without liability on the part of any non-defaulting
Underwriter or the Company, except for the expenses to be borne by the
Company and the Underwriters as provided in Section 6 hereof and the
indemnity agreements in Sections 7 and 8 hereof; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
11. Termination of Agreement: This Agreement may be terminated at any
time prior to the First Time of Delivery by the Underwriters if, after this
Agreement becomes effective, (i) trading in securities on the New York Stock
Exchange shall have been generally suspended or materially limited; (ii) trading
in the Company's securities on the New York Stock Exchange shall have been
suspended; (iii) a general banking moratorium shall have been declared by
federal or New York State authorities; (iv) there shall have occurred and be
continuing any substantial disruption of the settlements of securities or
clearance services in the United States; (v) there shall have occurred any
declaration of war by the United States Congress, an outbreak or substantial
escalation of hostilities involving the United States or any other substantial
national or international emergency, calamity or crisis affecting the United
States; or (vi) there shall not have occurred with respect to the credit ratings
accorded any securities of the Company:
13
(a) any downgrade by Standard and Poor's Rating Agency ("S&P"),
▇▇▇▇▇'▇ Investors Service ("▇▇▇▇▇'▇") or Fitch Ratings ("Fitch");
(b) any placement on Rating Watch with negative implication by Fitch
or placement on CreditWatch with negative implication by S&P; or
(c) any announcement of any downward change of rating outlook by S&P
(provided that such downward change is stated to be specific to
the Company and not in the context of concurrent downward changes
of other companies in the Company's sector),
in any such case provided for in clauses (i) through (vi) with the result that,
in the reasonable judgment of the Representatives, the marketability of the
Securities shall have been materially impaired.
If the Underwriters elect to terminate this Agreement as provided in
this Section 11, the Company shall be notified promptly by the Representatives
by telephone, confirmed in writing. If this Agreement shall not be carried out
by any Underwriter for any reason permitted hereunder, or if the sale of the
Securities to the Underwriters as herein contemplated shall not be carried out
because the Company is not able to comply with the terms hereof, the Company
shall not be under any obligation under this Agreement and shall not be liable
to any Underwriter or to any member of any selling group for the loss of
anticipated profits from the transactions contemplated by this Agreement (except
that the Company shall remain liable to the extent provided in Sections 6(f) and
(g) hereof) and the Underwriters shall be under no liability to the Company nor
be under any liability under this Agreement to one another.
12. Notices: All notices hereunder shall, unless otherwise expressly
permitted, be in writing and be delivered at or mailed to the following
addresses:
Mirant Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Treasurer
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with copies to (such copy not to constitute notice to the Company):
▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
14
If to the Underwriters at:
Banc of America Securities LLC
▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Credit Suisse First Boston Corporation
Eleven Madison Avenue
New York, New York 10010
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with copies to (such copy not to constitute notice to the
Underwriters):
Shearman & Sterling
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇ III
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
13. Parties in Interest: The agreement herein set forth has been and
is made solely for the benefit of the Underwriters and the Company, its
directors and officers, and the controlling persons, if any, referred to in
Sections 7 and 8 hereof, and their respective successors, assigns, executors and
administrators, and no other person shall acquire or have any right under or by
virtue of this Agreement.
14. Applicable Law, Jurisdiction: This Agreement shall be governed
by and construed in accordance with the laws of the State of New York, without
giving effect to the choice of law or conflict of law principles thereof.
15. Counterparts: This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, and all of which
together shall be deemed to be one and the same instrument.
15
Please confirm that the foregoing correctly sets forth the agreement
between the Company and the Underwriters.
Very truly yours,
MIRANT CORPORATION
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, III
-------------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, III
Title: Senior Vice President and
Treasurer
Confirmed and accepted as of the date first above written.
BANC OF AMERICA SECURITIES LLC
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇▇
Title: Managing Director
CREDIT SUISSE FIRST BOSTON CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
-------------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Managing Director
▇▇▇▇▇▇▇ ▇▇▇▇▇ BARNEY INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
-------------------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Director
Acting on behalf of themselves and
as Representatives of the several Underwriters
16
SCHEDULE A
----------
Underwriters
Principal Amount of Firm
Underwriter Securities to be Purchased
----------- --------------------------
Banc of America Securities LLC $ 98,666,000
Credit Suisse First Boston Corporation 98,666,000
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. 98,666,000
Commerzbank Capital Markets Corp. 29,602,000
Dresdner Kleinwort ▇▇▇▇▇▇▇▇▇▇▇ Securities LLC 22,200,000
Westdeutsche Landesbank Girozentrale, London Branch 22,200,000
----------
Total.............................. $370,000,000
------------
EXHIBIT 1a
----------
Form of Opinion of ▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
----------------------------------------------
1. The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of Delaware, with full
corporate power and authority to own or lease, as the case may be, and to
operate its properties and conduct its business as described in the Prospectus
and to enter into and perform its obligations under, and as contemplated under,
the Underwriting Agreement and the Indenture.
2. All the outstanding shares of capital stock of the Company have
been duly and validly authorized and issued and are fully paid and
non-assessable.
3. The Company's authorized equity capitalization is as set forth
in the Prospectus; the capital stock of the Company conforms in all material
respects to the description thereof contained in the Prospectus.
4. To our knowledge, there is no pending or threatened action, suit
or proceeding by or before any court or governmental agency, authority or body
or any arbitrator involving the Company or any of its subsidiaries or its or
their property of a character required to be disclosed in the Registration
Statement or the Prospectus and which is not so disclosed, and there is no
contract or other document of a character required to be described in the
Registration Statement or the Prospectus, or to be filed as an exhibit thereto,
which is not described or filed as required.
5. The statements included in the Prospectus under the captions
"Description of Notes," "Description of Debt Securities" and "Description of
Capital Stock," to the extent that they purport to summarize provisions of the
Securities, the Common Stock and the Company's charter and by-laws or legal
matters, fairly summarize, in all material respects, such provisions or matters.
6. Each of the documents incorporated by reference in the Registration
Statement or the Prospectus at the time they were filed or last amended (other
than the financial statements and the notes thereto, the financial schedules,
any other financial data included or incorporated by reference therein, and the
Statement of Eligibility of Trustee on Form T-1 included as an exhibit to the
Registration Statement (the "Form T-1"), as to which such counsel expresses no
opinion), complied as to form in all material respects with the requirements of
the Exchange Act and the rules and regulations promulgated thereunder, as
applicable.
7. To our knowledge, no holders of securities of the Company have
rights to the registration of such securities under the Registration Statement
that have not been waived with respect to the offering of the Securities.
8. The Underwriting Agreement has been duly authorized, executed and
delivered by the Company.
9. The Indenture has been duly authorized, executed and delivered by
the Company and, assuming due authorization, execution and delivery by the
Trustee, constitute valid and binding obligations of the Company, enforceable
against the Company in accordance with their terms, except as enforcement
thereof may be limited by bankruptcy, insolvency (including, without limitation,
all laws relating to fraudulent transfers), reorganization, moratorium or
similar laws affecting the enforcement of creditors' rights generally and except
as enforcement is considered in a proceeding in equity or at law.
10. The Securities have been duly authorized, executed and delivered
by the Company and, assuming due authorization, execution, authentication and
delivery by the Trustee, constitute valid and binding obligations of the
Company, entitled to the benefits of the Indenture and enforceable against the
Company in accordance with their terms, except as enforcement thereof may be
limited by bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally and except as
enforcement is considered in a proceeding in equity or at law.
11. The shares of Common Stock issuable upon conversion of the
Securities have been duly authorized and reserved for issuance upon such
conversion by all necessary corporate action and such shares, when issued upon
such conversion in accordance with the terms and provisions of the Securities,
will be validly issued, fully paid and non-assessable and will not be subject to
any preemptive rights under (A) the Certificate of Incorporation or By-laws of
the Company in effect as of the date hereof or (B) to such counsel's knowledge,
other similar rights of any securityholder of the Company.
12. The Securities and the Indenture conform in all material respects
as to legal matters to the descriptions thereof in the Prospectus.
13. The Registration Statement has become effective under the Act; any
required filing of the Prospectus, and any supplements thereto, pursuant to Rule
424(b) have been made in the manner and within the time period required by Rule
424(b); to our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose have
been instituted or threatened; and the Registration Statement and the Prospectus
comply as to form in all material respects with the applicable requirements of
the Act and the rules and regulations promulgated thereunder.
14. The Company is not and, after giving effect to the offering and
sale of the Securities and the application of the proceeds thereof as described
in the Prospectus, will not be, an "investment company" required to be
registered under the Investment Company Act of 1940, as amended.
15. No consent, approval, authorization or order, and no filing or
registration with, any United States or New York state court or governmental
agency or body (other than the securities or blue sky laws of the various
states, as to which such counsel expresses no opinion), is legally required for
the issuance, sale and delivery of the Securities by the Company to the
Underwriters pursuant to the Underwriting Agreement, or the performance by the
Company of its obligations under the Underwriting Agreement, the Indenture and
the Securities.
16. The execution, delivery and performance by the Company of the
Underwriting Agreement, the Indenture and the Securities, the consummation by
the Company of the transactions contemplated hereby and thereby and in the
Prospectus, compliance by the Company with the terms of the foregoing and the
application of the proceeds from the sale of the Securities contemplated by the
Prospectus do not and will not as of the date hereof result in a breach or
violation of any of the terms or provisions of, or constitute a default under,
any published statute, rule or regulation applicable to the Company or any
judgment, order or decree known to such counsel of any court, regulatory body,
administrative agency or governmental body of the United States or the State of
New York having jurisdiction over the Company.
17. The Stockholder Rights Plan has been duly authorized by the
Company and constitutes a valid and binding agreement of the Company; the shares
of Common Stock issuable upon conversion of the Securities will be entitled to
the benefits of the Stockholder Rights Plan.
Nothing has come to such counsel's attention that would lead such
counsel to believe that the Registration Statement or any amendment thereto
(except for financial statements and schedules and other financial data included
or incorporated by reference therein or omitted therefrom and the Form T-1, as
to which such counsel makes no statement), at the time such Registration
Statement or any such amendment became effective or on the 10-K Filing Date or
the date of the Prospectus Supplement, contained an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading or that the
Prospectus or any amendment or supplement thereto (except for financial
statements and schedules and other financial data included or incorporated by
reference therein or omitted therefrom and the From T-1, as to which such
counsel makes no statement), at the time the Prospectus was issued, at the time
any such amended or supplemented prospectus was issued or at the Time of
Delivery, included or includes an untrue statement of a material fact or omitted
or omits to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, or that any document incorporated by reference in the Registration
Statement, other than the Form T-1, or any amendment or supplement thereto made
by the Company prior to the Time of Delivery, when they were filed with the
Commission, as the case may be, contained (except for financial statements and
schedules and other financial data included or incorporated by reference or
omitted therefrom, as to which such counsel makes no statement) an untrue
statement of a material fact or omitted 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. Such counsel has not independently
verified the accuracy, completeness or fairness of the statements contained in
the Registration Statement and the Prospectus, including statements contained in
the documents incorporated by reference therein, and such counsel is not passing
upon and does not assume any responsibility for the accuracy, completeness or
fairness of such statements.
In rendering such opinion, such counsel may rely as to matters of fact
(but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company, the Trustee and public
officials. Such opinion shall not state that it is to be governed or qualified
by, or that it is otherwise subject to, any treatise, written policy or other
document relating to legal opinions, including, without limitation, the Legal
Opinion Accord of the ABA Section of Business Law (1991).
EXHIBIT 1b
----------
Form of Opinion of Skadden, Arps, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
----------------------------------------------------
We hereby confirm that, although the discussion set forth in the
Prospectus under the heading "Certain United States Federal Income Tax
Consequences" does not purport to discuss all possible United States federal
income tax consequences of the purchase, ownership and disposition of the
Securities, such discussion constitutes, in all material respects, a fair and
accurate summary of the matters of United States federal income tax law referred
to therein.
EXHIBIT 2
---------
Form of Opinion of Shearman & Sterling
--------------------------------------
1. The Company is a corporation duly incorporated and validly
existing in good standing under the laws of the State of Delaware, with
corporate power and authority under such laws to own or lease its properties and
conduct its business as described in the Prospectus.
2. The Underwriting Agreement has been duly authorized, executed and
delivered by the Company.
3. The Indenture has been duly authorized, executed and delivered by
the Company and, assuming due authorization, execution and delivery by the
Trustee, constitutes a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms, except as (x) enforcement
thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally (including, without
limitation, all laws relating to fraudulent transfers) and (y) enforcement
thereof is subject to general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law).
4. The Securities have been duly authorized and executed by the
Company and, when authenticated by the Trustee in accordance with the terms of
the Indenture and delivered to and paid for by you in accordance with the terms
of the Underwriting Agreement, will be (x) valid and binding obligations of the
Company enforceable against the Company in accordance with their terms, except
as (A) enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights generally
(including without limitation, all laws relating to fraudulent transfers) and
(B) enforcement thereof is subject to general principles of equity (regardless
of whether enforcement is considered in a proceeding in equity or at law) and
(y) entitled to the benefits of the Indenture.
5. The issuance of the shares of Common Stock issuable upon
conversion of the Securities has been duly authorized, and the shares of Common
Stock issuable upon such conversion have been duly reserved, by all necessary
corporate action on the part of the Company and, when issued, will be validly
issued, fully paid and non-assessable.
6. The statements in the Prospectus under the captions "Description
of Notes" and "Description of Capital Stock," insofar as such statements
constitute summaries of the legal matters or documents referred to therein,
fairly summarize the matters referred to therein.
Nothing has come to such counsel's attention that would lead such
counsel to believe that the Registration Statement or any amendment thereto
(except for financial statements and schedules and other financial data included
or incorporated by reference therein or omitted therefrom, as to which we need
make no statement), at the time such Registration Statement or any such
amendment 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 or any
amendment or supplement thereto (except for financial statements and schedules
and other financial data included or incorporated by reference therein or
omitted therefrom, as to which we need make no statement), at the time the
Prospectus was issued, at the time any such amended or supplemented prospectus
was issued or at the Time of Delivery, included or includes an untrue statement
of a material fact or omitted or omits to state a material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading.
In rendering such opinion, such counsel may rely as to matters of fact
(but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials. Such
opinion shall not state that it is to be governed or qualified by, or that it is
otherwise subject to, any treatise, written policy or other document relating to
legal opinions, including, without limitation, the Legal Opinion Accord of the
ABA Section of Business Law (1991).
EXHIBIT 3
---------
Form of KPMG Comfort Letter
---------------------------
[KPMG's draft comfort letter to be inserted]
ANNEX A
-------
Mirant Corporation
Lock-Up Agreement
Banc of America Securities LLC
▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Credit Suisse First Boston Corporation
Eleven ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
As Representatives of the several Underwriters Listed on
Schedule A to the Underwriting Agreement described below
Re: Mirant Corporation - Lock-Up Agreement
--------------------------------------
Ladies and Gentlemen:
The undersigned understands that you (collectively, the
"Underwriters"), propose to enter into an Underwriting Agreement with Mirant
Corporation, a Delaware corporation (the "Company"), providing for a public
offering of $370,000,000 aggregate principal amount of 5.75% Convertible Senior
Notes due 2007 (the "Firm Securities"), convertible into shares of common stock,
$.01 par value per share (the "Common Stock"), of the Company, pursuant to a
Registration Statement on Form S-3 filed with the Securities and Exchange
Commission (the "SEC"). The Company also proposes to grant to the Underwriters
an option to purchase up to an additional $55,500,000 aggregate principal amount
of 5.75% Convertible Senior Notes due 2007 to cover over-allotments (the
"Optional Securities"); the Optional Securities, together with the Firm
Securities, being hereinafter called the "Securities."
In consideration of the agreement by the Underwriters to offer and
sell the Securities, and of other good and valuable consideration the receipt
and sufficiency of which is hereby acknowledged, the undersigned agrees that,
during the period beginning from the date hereof and continuing to and including
the date 60 days after the date of the Prospectus covering the public offering
of the Securities, the undersigned will not offer, sell, contract to sell,
pledge, grant any option to purchase, make any short sale or otherwise dispose
of any shares of Common Stock, purchase contract or any shares of Common Stock,
or any options or warrants to purchase any shares of Common Stock, or any
securities convertible into, exchangeable for or that represent the right to
receive any shares of Common Stock, purchase contract or any shares of Common
Stock, whether now owned or hereinafter acquired, owned directly by the
undersigned (including holding as a custodian) or with respect to which the
undersigned has beneficial ownership within the rules and regulations of the SEC
(collectively the "Undersigned's Shares").
The restrictions herein shall not apply to any of the Undersigned's
Shares contributed by the Company to the Employee Savings Plan ("Plan Shares").
In the event the Plan Shares are sold, the undersigned agrees to submit a
request to, and obtain prior approval from the Company Treasurer, and to sell
such Plan Shares through the Underwriters, except where such Plan Shares are
held in a 401(k) plan not administered by the Underwriters.
The foregoing restriction is expressly agreed to preclude the
undersigned from engaging in any hedging or other transaction which is designed
to or which reasonably could be expected to lead to or result in a sale or
disposition of the Undersigned's Shares even if such shares would be disposed of
by someone other than the undersigned. Such prohibited hedging or other
transactions would include without limitation any short sale or any purchase,
sale or grant of any right (including without limitation any put or call option)
with respect to any of the Undersigned's Shares or with respect to any security
that includes, relates to, or derives any significant part of its value from
such Shares.
Notwithstanding the foregoing, the undersigned may transfer the
Undersigned's Shares (i) as a bona fide gift or gifts, provided that the donee
or donees thereof agree to be bound in writing by the restrictions set forth
herein, (ii) to any trust for the direct or indirect benefit of the undersigned
or the immediate family of the undersigned, provided that the trustee of the
trust agrees to be bound in writing by the restrictions set forth herein, and
provided further that any such transfer shall not involve a disposition for
value, or (iii) with the prior written consent of the Underwriters. For purposes
of this Lock-Up Agreement, "immediate family" shall mean any relationship by
blood, marriage or adoption, not more remote than first cousin. In addition,
notwithstanding the foregoing, if the undersigned is a corporation, the
corporation may transfer the capital stock of the Company to any wholly owned
subsidiary of such corporation; provided, however, that in any such case, it
shall be a condition to the transfer that the transferee execute an agreement
stating that the transferee is receiving and holding such capital stock subject
to the provisions of this Agreement and there shall be no further transfer of
such capital stock except in accordance with this Agreement, and provided
further that any such transfer shall not involve a disposition for value. The
undersigned now has, and, except as contemplated by clause (i), (ii) or (iii)
above, for the duration of this Lock-Up Agreement will have, good and marketable
title to the Undersigned's Shares, free and clear of all liens, encumbrances,
and claims whatsoever. The undersigned also agrees and consents to the entry of
stop transfer instructions with the Company's transfer agent and registrar
against the transfer of the Undersigned's Shares except in compliance with the
foregoing restrictions.
The undersigned understands that the Company and the Underwriters are
relying upon this Lock-Up Agreement in proceeding toward consummation of the
offering. The undersigned further understands that this Lock-Up Agreement is
irrevocable and shall be binding upon the undersigned's heirs, legal
representatives, successors, and assigns.
Very truly yours,
----------------------------------------
Exact Name of Shareholder
----------------------------------------
Authorized Signature
----------------------------------------
Title
