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EXHIBIT 1.1
30,000,000 Shares Common Stock
SCG HOLDING CORPORATION
FORM OF UNDERWRITING AGREEMENT
[ ], 2000
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[ ], 2000
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
Chase Securities Inc.
▇▇▇▇▇▇ Brothers Inc.
FleetBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
c/o Morgan ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs and Mesdames:
SCG HOLDING CORPORATION, a Delaware corporation (the "COMPANY"),
proposes to issue and sell to the several Underwriters named in Schedule I
hereto (the "UNDERWRITERS") 30,000,000 shares of its common stock, $0.01 par
value per share, (the "FIRM SHARES"). The Company also proposes to issue and
sell to the several Underwriters not more than an additional 4,500,000 shares of
its common stock, $0.01 par value per share, (the "ADDITIONAL SHARES") if and to
the extent that you, as Managers of the offering, shall have determined to
exercise, on behalf of the Underwriters, the right to purchase such shares of
common stock granted to the Underwriters in Section 2 hereof. The Firm Shares
and the Additional Shares are hereinafter collectively referred to as the
"SHARES." The shares of common stock, $0.01 par value per share, of the Company
to be outstanding after giving effect to the sales contemplated hereby are
hereinafter referred to as the "COMMON STOCK."
The Company has filed with the Securities and Exchange Commission (the
"COMMISSION") a registration statement, including a prospectus, relating to the
Shares. The registration statement as amended at the time it becomes effective,
including the information (if any) deemed to be part of the registration
statement at the time of effectiveness pursuant to Rule 430A under the
Securities Act of 1933, as amended (the "SECURITIES ACT"), is hereinafter
referred to as the "REGISTRATION STATEMENT"; the prospectus in the form first
used to confirm sales of Shares is hereinafter referred to as the "PROSPECTUS."
If the Company has filed an abbreviated registration statement to register
additional shares of Common Stock pursuant to Rule 462(b) under the Securities
Act (the "RULE 462 REGISTRATION STATEMENT"),
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then any reference herein to the term "REGISTRATION STATEMENT" shall be deemed
to include such Rule 462 Registration Statement.
As part of the offering contemplated by this Agreement, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Barney Inc. has agreed to reserve out of the Securities set forth opposite its
name on the Schedule I to this Agreement, up to 2,500,000 shares, for sale to
the Company's employees, officers, and directors and other parties associated
(wi)th the Company and Texas Pacific Group (collectively, "PARTICIPANTS"), as
set forth in the Prospectus under the heading "Underwriting--Directed Share
Program" (the "DIRECTED SHARE PROGRAM"). The Securities to be sold by ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ Inc. pursuant to the Directed Share Program (the "DIRECTED SHARES")
will be sold by ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. pursuant to this Agreement at the
public offering price. Any Directed Shares not orally confirmed for purchase by
any Participants by the end of the business day on which this Agreement is
executed will be offered to the public by ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. as set forth
in the Prospectus.
1. Representations and Warranties. The Company represents and warrants
to and agrees with each of the Underwriters that:
(a) 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 threatened by the
Commission.
(b) (1) The Registration Statement, when it became effective, did not
contain and, as amended or supplemented, if applicable, 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, (2) the Registration Statement and the Prospectus comply
and, as amended or supplemented, if applicable, will comply in all material
respects with the Securities Act and the applicable rules and regulations
of the Commission thereunder and (3) the Prospectus does not contain and,
as amended or supplemented, if applicable, will not 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 based upon
information relating to any Underwriter furnished to the Company in writing
by such Underwriter through you expressly for use therein.
(c) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the State of Delaware, 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
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would not, singly or in the aggregate, have a material adverse effect on
the Company and its subsidiaries, taken as a whole.
(d) Each subsidiary of the Company has been duly incorporated or
formed, is validly existing as a corporation, limited liability company or
similar entity in good standing under the laws of the jurisdiction of its
incorporation or formation, as the case may be, has all power and authority
necessary 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; all of the outstanding membership interests, shares of capital
stock or other equity interests of each subsidiary of the Company have been
duly and validly authorized and issued; are, in the case of capital stock
or membership interests of subsidiaries organized under the laws of the
United States, fully paid and non-assessable or, in the case of the
membership interests of any subsidiary of the Company that is a Delaware
limited liability company, are not subject to assessment by such subsidiary
of the Company for additional capital contributions; and are owned directly
or indirectly by the Company (other than (i) those shares of capital stock
of Leshan-Phoenix Semiconductor Co., Ltd. ("LESHAN") that are owned by
Leshan Radio Company Ltd. and Motorola (China) Investment Ltd., (ii) shares
of capital stock of Tesla Sezam, a.s. ("TESLA") that are owned by Terosil
a.s. ("TEROSIL") and others, (iii) shares of capital stock of Terosil that
are owned by Tesla and others, [(iv) in the case of Motorola Philippines
Inc. ("MPI"), all of the shares thereof the record holder of which is, and
will be for an agreed period of time following the consummation of the
offering of the Shares, Motorola International Development Corp. ("MICD"),
as provided for in the Interim Agreement dated as of [ ] among Motorola,
Inc., MIDC, MPI, SCI LLC and the Company,] (v) 60% of the shares of capital
stock of Amicus Realty Corporation and (vi) in the case of foreign
subsidiaries, directors' qualifying shares or shares required by applicable
law to be held by a person other than Semiconductor Components Industries,
LLC ("SCI LLC"), the Company or a subsidiary thereof), free and clear of
any lien, charge, encumbrance, security interest, restriction upon voting
or transfer or any other claim of any third party (other than those (x)
imposed pursuant to the Loan Documents (as defined in the Amended and
Restated Credit Agreement dated as of April 3, 2000 among SCI LLC, as
borrower, the Company, as parent, the lenders named therein, The Chase
Manhattan Bank, as administrative agent, collateral agent and syndication
agent, [DLJ Capital Funding, Inc., ▇▇▇▇▇▇ Commercial Paper Inc. and Credit
Lyonnais New York Branch, as co-documentation agents, and Chase Securities
Inc., as arranger, as amended] (the "CREDIT AGREEMENT")), (y) in the case
of Semiconductor Miniatures Products Malaysia Sdn. Bhd., SCG (SMP Malaysia)
Holding Corporation, Motorola Semiconductor Sdn. Bhd. and SCG Malaysia
Holding Sdn. Bhd., imposed by applicable law and (z) in the case of Amicus
Realty Corporation, imposed by the By-Laws thereof). As of the date hereof,
all of the membership interests of SCI LLC are held by the Company. As of
the date hereof, Semiconductor Components Industries Puerto Rico, Inc.
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and SCG International Development LLC have no operations or assets material
to the Company and its subsidiaries, taken as a whole.
(e) Subsequent to the respective dates as of which information is given
in the Registration Statement and the Prospectus, (1) the Company and its
subsidiaries have not incurred any material liability or obligation, direct
or contingent, nor entered into any material transaction not in the
ordinary course of business; (2) the Company has not purchased any of its
outstanding capital stock, nor declared, paid or otherwise made any
dividend or distribution of any kind on its capital stock; and (3) there
has not been any material change in the capital stock, short-term debt or
long-term debt of the Company and its subsidiaries, except in each case as
described in the Prospectus.
(f) The Company and its subsidiaries have good and marketable title in
fee simple to all real property and good and marketable title to all
personal property owned by them that is material to the business of the
Company and its subsidiaries, in each case free and clear of all liens,
encumbrances and defects except (1) such as are described in the
Prospectus, (2) such as are imposed pursuant to the Credit Agreement and
the other agreements executed in connection therewith or (3) such as would
not have a material adverse effect on the value of such property and would
not interfere materially with the use made and proposed to be made of such
property by the Company and its subsidiaries; and any real property and
buildings held under lease by the Company and its subsidiaries are held by
them under valid, subsisting and enforceable leases with such exceptions as
are not material and do not interfere with the use made and proposed to be
made of such property and buildings by the Company and its subsidiaries, in
each case except as described in the Prospectus.
(g) The Company and its subsidiaries own or possess, or can acquire on
reasonable terms, all material patents, patent rights, licenses,
inventions, copyrights, know-how (including trade secrets and other
unpatented and/or unpatentable proprietary or confidential information,
systems or procedures), trademarks, service marks and trade names currently
employed by them in connection with the business now operated by them, and
neither the Company nor any of its subsidiaries has received any notice of
infringement of or conflict with asserted rights of others with respect to
any of the foregoing that, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would have a material adverse
effect on the Company and its subsidiaries, taken as a whole, except in
each case as described in the Prospectus.
(h) No material labor dispute with the employees of the Company or any
of its subsidiaries exists, or, to the knowledge of the Company, is
imminent; and the Company is not aware of any existing, threatened or
imminent labor disturbance by the employees of any of its principal
suppliers, manufacturers or contractors that would have a material adverse
effect on the Company and its subsidiaries, taken as a whole.
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(i) The Company and its subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks and in
such amounts as are prudent and customary in the businesses in which they
are engaged; and neither the Company nor any of its subsidiaries has any
reason to believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar coverage
from similar insurers as may be necessary to continue its business at a
cost that would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(j) The Company and its subsidiaries possess all certificates,
authorizations and permits issued by the appropriate federal, state or
foreign regulatory authorities necessary to conduct their respective
businesses, and neither the Company nor any of its subsidiaries has
received any notice of proceedings relating to the revocation or
modification of any such certificate, authorization or permit that, singly
or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would have a material adverse effect on the Company and its
subsidiaries, taken as a whole [, except in each case as described in the
Prospectus.]
(k) The Company and each of its subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance, in
all material respects, that (1) transactions are executed in accordance
with management's general or specific authorizations; (2) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain
asset accountability; and (3) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(l) PricewaterhouseCoopers LLP ("PWC") and KPMG LLP ("KPMG") are
independent certified public accountants with respect to the Company and
its subsidiaries within the meaning of Rule 101 of the Code of Professional
Conduct of the American Institute of Certified Public Accountants and its
interpretations and rulings thereunder; the Unaudited Pro Forma Financial
Data contained in the Prospectus have been prepared on a basis consistent
with the historical financial statements contained in the Prospectus
(except for the pro forma adjustments specified therein), have been
properly compiled on the pro forma basis described in the notes thereto and
give effect to assumptions made on a reasonable basis as of the date of the
Prospectus; and the other historical financial and statistical information
and data included in the Prospectus (subject to the explanation of such
data as set forth therein) are, in all material respects, fairly presented.
(m) This Agreement has been duly authorized, executed and delivered by
the Company.
(n) The authorized capital stock of the Company conforms to the
description thereof contained in the Prospectus.
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(o) The shares of Common Stock outstanding prior to the issuance of the
Shares have been duly authorized and are validly issued, fully paid and
non-assessable.
(p) The Shares have been duly authorized and, when issued and delivered
in accordance with the terms of this Agreement, will be validly issued,
fully paid and non-assessable, and the issuance of such Shares will not be
subject to any preemptive or similar rights.
(q) The execution and delivery by the Company of, and the performance
by the Company of its obligations under, this Agreement 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 any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the Company or
any subsidiary, and no consent, approval, authorization or order of, or
qualification with, any governmental body or agency is required for the
performance by the Company of its obligations under this Agreement, except
such as may be required by the securities or Blue Sky laws of the various
states in connection with the offer and sale of the Shares.
(r) There has not occurred any material adverse change, or any
development involving a prospective 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).
(s) 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 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 described or filed as required.
(t) Each preliminary prospectus filed as part of the registration
statement as originally filed or as part of any amendment thereto, or filed
pursuant to Rule 424 under the Securities Act, complied when so filed in
all material respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder, except that no representation is
made as to the omission of price range and the numbers of Firm Shares,
Additional Shares and Shares and other information derived from the
foregoing, to the extent any of the foregoing was omitted from the initial
filing of the Registration Statement.
(u) The Company is not and, after giving effect to the offering and
sale of the Shares and the application of the proceeds thereof as described
in the Prospectus, will not be
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required to register as an "investment company" as such term is defined in
the Investment Company Act of 1940, as amended.
(v) Except as would, singly and in the aggregate, not have a material
adverse effect on the Company and its subsidiaries, taken as a whole, the
Company and its subsidiaries (1) are in compliance with any and all
applicable foreign, federal, state and local laws and regulations relating
to the protection of human health and safety, the environment or hazardous
or toxic substances or wastes, pollutants or contaminants ("ENVIRONMENTAL
LAWS"), (2) have received all permits, licenses or other approvals required
of them under applicable Environmental Laws to conduct their respective
businesses and (3) are in compliance with all terms and conditions of any
such permit, license or approval.
(w) There are no costs or liabilities associated with Environmental
Laws (including, without limitation, any capital or operating expenditures
required for clean-up, closure of properties or compliance with
Environmental Laws or any permit, license or approval, any related
constraints on operating activities and any potential liabilities to third
parties) that would, singly or in the aggregate, have a material adverse
effect on the Company and its subsidiaries, taken as a whole.
(x) 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 or to require the Company to
include such securities with the Shares registered pursuant to the
Registration Statement, except as described in the Prospectus.
(y) The Company has complied with all provisions of Section 517.075,
Florida Statutes relating to doing business with the Government of Cuba or
with any person or affiliate located in Cuba.
Furthermore, the Company represents and warrants to ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ Inc. that (i) the Registration Statement, the Prospectus and any
preliminary prospectus comply, and any further amendments or supplements thereof
will comply, with any applicable laws or regulations of foreign jurisdictions in
which the Prospectus or any preliminary prospectus, as amended or supplemented,
if applicable, are distributed in connection with the Directed Share Program,
and that (ii) no authorization, approval, consent, license, order, registration
or qualification of or with any government, governmental instrumentality or
court, other than such as have been obtained, is necessary under the securities
laws and regulations of foreign jurisdictions in which the Directed Shares are
offered outside the United States.
2. Agreements to Sell and Purchase. The Company hereby agrees to sell
to the several Underwriters, and each Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees, severally and not jointly, to purchase from the
Company the respective numbers of Firm Shares set forth in Schedule I hereto
opposite its name at $[ ] a share (the "PURCHASE PRICE").
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On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees to sell
to the Underwriters the Additional Shares, and the Underwriters shall have a
one-time right to purchase, severally and not jointly, up to 4,500,000
Additional Shares at the Purchase Price. If you, on behalf of the Underwriters,
elect to exercise such option, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ shall so notify the Company in
writing not later than 30 days after the date of this Agreement, which notice
shall specify the number of Additional Shares to be purchased by the
Underwriters and the date on which such shares are to be purchased. Such date
may be the same as the Closing Date (as defined below) but not earlier than the
later of the Closing Date and one business day after the date of such notice nor
later than ten business days after the date of such notice. Should such date be
subsequent to the Closing Date, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ shall provide such notice no
later than three business days prior to such date. Additional Shares may be
purchased as provided in Section 4 hereof solely for the purpose of covering
over-allotments made in connection with the offering of the Firm Shares. If any
Additional Shares are to be purchased, each Underwriter agrees, severally and
not jointly, to purchase the number of Additional Shares (subject to such
adjustments to eliminate fractional shares as you may determine) that bears the
same proportion to the total number of Additional Shares to be purchased as the
number of Firm Shares set forth in Schedule I hereto opposite the name of such
Underwriter bears to the total number of Firm Shares.
The Company hereby agrees that, without the prior written consent of ▇▇▇▇▇▇
▇▇▇▇▇▇▇ on behalf of the Underwriters, it will not, during the period ending 180
days after the date of the Prospectus, (i) offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase, lend, or otherwise
transfer or dispose of, directly or indirectly, any shares of Common Stock or
any securities convertible into or exercisable or exchangeable for Common Stock
or (ii) enter into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of the Common
Stock, whether any such transaction described in clause (i) or (ii) above is to
be settled by delivery of Common Stock or such other securities, in cash or
otherwise. The foregoing sentence shall not apply to (A) the Shares to be sold
hereunder, (B) the issuance by the Company of shares of Common Stock upon the
exercise of an option or warrant or the conversion of a security outstanding on
the date hereof, or in the case of an option granted after the date hereof,
pursuant to existing employee benefit plans of the Company or any of its
subsidiaries, of which the Underwriters have been advised in writing, (C) the
granting by the Company of any options to purchase shares of Common Stock or any
restricted stock units or the sale by the Company of any shares of Common Stock,
in each case pursuant to any existing employee benefit plan or direct stock plan
of the Company or any of its subsidiaries, (D) the issuance by the Company of
any shares of Common Stock in connection with the acquisition of or merger with
or into any other company or the acquisition of any assets, or (E) transfers and
dispositions between one or more affiliates of Texas Pacific Group or partners,
shareholders or members of any such affiliate, provided, that in the case of any
issuance, transfer or disposition pursuant to clause (D) or (E), (i) each
recipient of such shares shall agree in writing, for the benefit of
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇ on behalf of the Underwriters, that such shares shall remain
subject to restrictions identical to those contained in the first sentence of
this paragraph for the remainder of the period for which the Company is bound
thereunder, and each such recipient shall execute and deliver to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
a duplicate of such writing, and (ii) if a filing by any party to such issuance,
transfer or disposition (issuer, transferor, disposer, recipient or transferee)
under Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"EXCHANGE ACT"), shall be required in connection with such issuance, transfer or
disposition (other than a filing on a Form 5 made after the expiration of the
180-day period referred to above), such party shall provide ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ no
less than seven days prior notice of such filing (it being understood that no
such filing shall be made by any such party if not required to be made under the
Exchange Act).
3. Terms of Public Offering. The Company is advised by you that the
Underwriters propose to make a public offering of their respective portions of
the Shares as soon after the Registration Statement and this Agreement have
become effective as in your judgment is advisable. The Company is further
advised by you that the Shares are to be offered to the public initially at $[ ]
a share (the "PUBLIC OFFERING PRICE") and to certain dealers selected by you at
a price that represents a concession not in excess of $[ ] a share under the
Public Offering Price, and that any Underwriter may allow, and such dealers may
reallow, a concession, not in excess of $[ ] a share, to any Underwriter or to
certain other dealers.
4. Payment and Delivery. Payment for the Firm Shares shall be made to the
Company in Federal or other funds immediately available at the offices of
Cleary, Gottlieb, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ in New York City against delivery of such
Firm Shares for the respective accounts of the several Underwriters at 10:00
a.m., New York City time, on [ ], 2000, or at such other time on the same or
such other date, not later than [ ], 2000, as shall be designated in writing by
you. The time and date of such payment are hereinafter referred to as the
"CLOSING DATE".
Payment for any Additional Shares shall be made to the Company in Federal
or other funds immediately available in New York City against delivery of such
Additional Shares for the respective accounts of the several Underwriters at
10:00 a.m., New York City time, on the date specified in the notice described in
Section 2 or at such other time on the same or on such other date, in any event
not later than [ ], 2000, as shall be designated in writing by you. The time and
date of such payment are hereinafter referred to as the "OPTION CLOSING DATE".
Certificates for the Firm Shares and Additional Shares shall be in
definitive form and registered in such names and in such denominations as you
shall request in writing not later than one full business day prior to the
Closing Date or the Option Closing Date, as the case may be. The certificates
evidencing the Firm Shares and Additional Shares shall be delivered to you on
the Closing Date or the Option Closing Date, as the case may be, for the
respective accounts of the several Underwriters, with any transfer taxes payable
in connection with the
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transfer of the Shares to the Underwriters duly paid, against payment of the
Purchase Price therefor.
5. Conditions to the Underwriters' Obligations. The obligations of the
Company to sell the Shares to the Underwriters and the several obligations of
the Underwriters to purchase and pay for the Shares on the Closing Date are
subject to the condition that the Registration Statement shall have become
effective not later than [ ] (New York City time) on the date hereof.
The several obligations of the Underwriters are 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 that does not indicate the direction
of the possible change, 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 prospective change, in the condition, financial or
otherwise, or in the earnings, business 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 Shares on the terms and in the manner
contemplated in the Prospectus.
(b) The Underwriters shall have received on the Closing Date a
certificate, dated the Closing Date and signed by any of (i) ▇▇▇▇▇ ▇▇▇▇▇▇,
President and Chief Executive Officer of the Company, (ii) ▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
Senior Vice President and Chief Operating Officer of the Company or (iii)
▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Senior Vice President and Chief Financial Officer of the
Company, to the effect set forth in Section 5(a)(i) above 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.
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(c) The Underwriters shall have received on the Closing Date from
▇▇▇▇▇▇ ▇. ▇▇▇▇, General Counsel of the Company, dated the Closing Date, an
opinion in a form reasonably acceptable to you.
(d) The Underwriters shall have received on the Closing Date from
Cleary, Gottlieb, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, special counsel to the Company, dated
the Closing Date, an opinion and a letter in forms reasonably acceptable to
you.
(e) The Underwriters shall have received on the Closing Date an
opinion of Cravath, Swaine & ▇▇▇▇▇, counsel for the Underwriters, dated the
Closing Date, covering the matters referred to in paragraphs (g) and (m) of
Annex A hereto. With respect to paragraph (m) of Annex A hereto, Cravath,
Swaine & ▇▇▇▇▇ may state that their opinion and belief are based upon their
participation in the preparation of the Registration Statement and
Prospectus and any amendments or supplements thereto and review and
discussion of the contents thereof, but are without independent check or
verification, except as specified.
(f) The Underwriters shall have received, on each of the date hereof
and the Closing Date, a letter dated the date hereof or the Closing Date,
as the case may be, in form and substance satisfactory to the Underwriters,
from PWC and KPMG, 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; provided that the letter delivered on the Closing Date
shall use a "cut-off date" not earlier than the date hereof.
(g) The "lock-up" agreements, each substantially in the form of
Exhibit A hereto, between you and TPG Advisors II, Inc., Motorola Inc. and
the directors and executive officers of the Company relating to sales and
certain other dispositions of shares of Common Stock or certain other
securities, delivered to you on or before the date hereof, shall be in full
force and effect on the Closing Date.
The several obligations of the Underwriters to purchase Additional Shares
hereunder are subject to the delivery to you on the Option Closing Date of such
documents as you may reasonably request with respect to the good standing of the
Company, the due authorization and issuance of the Additional Shares and other
matters related to the issuance of the Additional Shares.
6. Covenants of the Company. In further consideration of the agreements of
the Underwriters herein contained, the Company covenants with each Underwriter
as follows:
(a) To furnish to you, without charge, three signed copies of the
Registration Statement (including exhibits thereto) and for delivery to
each other Underwriter a conformed copy of the Registration Statement
(without exhibits thereto) and to furnish to
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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) Before amending or supplementing the Registration Statement or 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.
(c) If, during such period after the first date of the public offering
of the Shares as in the opinion of counsel for the Underwriters the
Prospectus is required by law to be delivered in connection with sales by
an Underwriter or 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, 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 Shares 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 Shares for offer and sale under the
securities or Blue Sky laws of such jurisdictions as you shall reasonably
request; provided that neither the Company nor any of its subsidiaries
shall be obligated to qualify as foreign corporations in any jurisdiction
in which it is not so qualified or to file a general consent to service of
process in any jurisdiction.
(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 [March 31, 2001] 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: (i) the fees, disbursements and expenses of the
Company's counsel and the Company's accountants in connection with the
registration and delivery of the Shares under the Securities Act and all
other fees or expenses in connection with the preparation and filing of the
Registration
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Statement, any preliminary prospectus, 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, (ii)
all costs and expenses related to the transfer and delivery of the Shares
to the Underwriters, including any transfer or other taxes payable thereon,
(iii) the cost of printing or producing any Blue Sky or Legal Investment
memorandum in connection with the offer and sale of the Shares under state
securities laws and all expenses in connection with the qualification of
the Shares for offer and sale under state securities laws as 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 or Legal Investment
memorandum, (iv) 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 Shares by the National Association of
Securities Dealers, Inc., (v) all fees and expenses in connection with the
preparation and filing of the registration statement on Form 8-A relating
to the Common Stock and all costs and expenses incident to listing the
Shares on the Nasdaq National Market, (vi) the cost of printing
certificates representing the Shares, (vii) the costs and charges of any
transfer agent, registrar or depositary, (viii) 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 Shares,
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 (ix) 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, the Underwriters will pay all of their costs
and expenses, including fees and disbursements of their counsel, stock
transfer taxes payable on resale of any of the Shares by them and any
advertising expenses connected with any offers they may make.
(g) In connection with the Directed Share Program, the Company will
ensure that the Directed Shares will be restricted to the extent required
by the National Association of Securities Dealers, Inc. (the "NASD") or the
NASD rules from sale, transfer, assignment, pledge or hypothecation for a
period of three months following the date of the effectiveness of the
Registration Statement. ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. will notify the Company
as to which Participants will need to be so restricted. The Company will
direct the removal of such transfer restrictions upon the expiration of
such period of time.
(h) The Company will pay all fees and disbursements of counsel
incurred by the Underwriters in connection with the Directed Share Program
and stamp duties, similar
14
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taxes or duties or other taxes, if any, incurred by the Underwriters in
connection with the Directed Share Program.
Furthermore, the Company covenants with ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. that the
Company will comply with all applicable securities and other applicable laws,
rules and regulations in each foreign jurisdiction in which the Directed Shares
are offered in connection with the Directed Share Program.
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 (as amended or supplemented, if the
Company shall have furnished 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 such Underwriter through you expressly for use therein; provided, however,
that the foregoing indemnity agreement with respect to any preliminary
prospectus shall not inure to the benefit of any Underwriter or any person who
controls any Underwriter within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act from whom the person asserting any such
losses, claims, damages or liabilities purchased Shares, if a copy of the
Prospectus (as then amended or supplemented, if the Company shall have furnished
any amendments or supplements thereto) was furnished by the Company to such
Underwriter but was not sent or given by or on behalf of such Underwriter to
such person, if required by law so to have been delivered, at or prior to the
written confirmation of the sale of such Shares to such person, and if the
Prospectus (as so amended or supplemented) would have cured the defect giving
rise to such loss, claim, damage or liability, unless such failure is the result
of noncompliance by the Company with Section 6(a) hereof.
(b) Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Company, its directors, its officers who sign 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 foregoing indemnity from the Company to such Underwriter,
but only with reference to information relating to such Underwriter furnished to
the Company in writing by such Underwriter through you expressly for use in the
Registration Statement, any preliminary prospectus, the Prospectus or any
amendments or supplements thereto.
15
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(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 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. 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 or (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. 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. Such firm shall be
designated in writing by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, in the case of parties indemnified
pursuant to Section 7(a), and by 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. Notwithstanding
the foregoing sentence, if at any time an indemnified party shall have requested
an indemnifying party to reimburse the indemnified party for fees and expenses
of counsel as contemplated by the second and third sentences of this paragraph,
the indemnifying party agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 60 days after receipt by such indemnifying party of the
aforesaid request and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of such
settlement. 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. Notwithstanding anything contained herein to the contrary, if
indemnity may be sought pursuant to Section 7(g) hereof in respect of such
action or proceeding, then in addition to such separate firm for the Indemnified
Parties, the Indemnifying Party shall be liable for the reasonable fees and
expenses of not more than one separate firm (in addition to any local counsel)
for ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc., the directors, officers, employees and agents of
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc., and all persons, if any, who control ▇▇▇▇▇▇▇ ▇▇▇▇▇
Barney Inc. within the meaning of
16
17
either the Act or the Exchange Act for the defense of any losses, claims,
damages and liabilities arising out of the Directed Share Program [indemnifiable
under Section 7(g)].
(d) To the extent the indemnification provided for in Section 7(a) or 7(b)
is unavailable to an indemnified party or insufficient in respect of any losses,
claims, damages or liabilities referred to therein, then each indemnifying party
under such Section 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 (i) 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 Shares
or (ii) if the allocation provided by clause 7(d)(i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause 7(d)(i) 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 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. The Underwriters' respective obligations to contribute
pursuant to this Section 7 are several in proportion to the respective number of
Shares they have purchased hereunder, and not joint.
(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 (even if the Underwriters were treated as one entity for such
purpose) 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
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 this Section 7, no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which the Shares
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages that 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 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.
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(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 (i) any termination of this Agreement, (ii) any investigation made
by or on behalf of any Underwriter or any person controlling any Underwriter or
by or on behalf of the Company, its officers or directors or any person
controlling the Company and (iii) acceptance of and payment for any of the
Shares.
(g) The Company agrees to indemnify and hold harmless ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Inc., the directors, officers, employees and agents of ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
and each person who controls ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. within the meaning of
either the Act or the Exchange Act (the "▇▇▇▇▇▇▇ ▇▇▇▇▇ BARNEY INC. ENTITIES"),
from and against any and all losses, claims, damages and liabilities to which
they may become subject under the Act, the Exchange Act or other Federal or
state statutory law or regulation, at common law or otherwise (including,
without limitation, any legal or other expenses reasonably incurred in
connection with defending or investigating any such action or claim), insofar as
such losses, claims damages or liabilities (or actions in respect thereof) (i)
arise out of or are based upon any untrue statement or alleged untrue statement
of a material fact contained in the prospectus wrapper material (the "MATERIAL")
prepared by or with the consent of the Company for distribution in foreign
jurisdictions in connection with the Directed Share Program attached to the
Prospectus or any preliminary prospectus, or arise out of or are based upon the
omission or alleged omission to state in the Material a material fact required
to be stated therein or necessary to make the statement therein, when considered
in conjunction with the Prospectus or any applicable preliminary prospectus, not
misleading; (ii) caused by the failure of any Participant to pay for and accept
delivery of the securities which immediately following the Effective Date of the
Registration Statement, were subject to a properly confirmed agreement to
purchase; or (iii) related to, arising out of, or in connection with the
Directed Share Program, provided that, the Company will not be liable in any
such case to the extent that any such loss, claim, damage or liability arises
out of or is based upon any such untrue statement or alleged untrue statement or
omission or alleged omission made therein in reliance upon and in conformity
with written information furnished to the Company by or on behalf of ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ Inc. specifically for inclusion in the Material.
(h) ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. agrees to indemnify and hold harmless the
Company, its directors, its officers who sign the Registration Statement and
each person, if any, who controls the Company within the meaning of either the
Act or the Exchange Act to the same extent as the indemnity from the Company to
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. provided in Section 7(g)(i) above, but only with
reference to information relating to ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. furnished to the
Company specifically for inclusion in the Material.
8. Termination. This Agreement shall be subject to termination by notice
given by you to the Company, if (a) after the execution and delivery of this
Agreement and prior to the Closing Date (i) 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
18
19
National Association of Securities Dealers, Inc., the Chicago Board of Options
Exchange, the Chicago Mercantile Exchange or the Chicago Board of Trade, (ii)
trading of any securities of the Company shall have been suspended on any
exchange or in any over-the-counter market, (iii) a general moratorium on
commercial banking activities in New York shall have been declared by either
Federal or New York State authorities or (iv) 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 (b) in
the case of any of the events specified in clauses 8(a)(i) through 8(a)(iv),
such event, singly or together with any other such event, makes it, in your
judgment, impracticable to market the Shares on the terms and in the manner
contemplated in the Prospectus.
9. Effectiveness; Defaulting Underwriters. This Agreement shall become
effective upon the execution and delivery hereof by the parties hereto.
If, on the Closing Date or the Option Closing Date, as the case may be, any
one or more of the Underwriters shall fail or refuse to purchase Shares that it
has or they have agreed to purchase hereunder on such date, and the aggregate
number of Shares which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase is not more than one-tenth of the aggregate number
of the Shares to be purchased on such date, the other Underwriters shall be
obligated severally in the proportions that the number of Firm Shares set forth
opposite their respective names in Schedule I bears to the aggregate number of
Firm Shares set forth opposite the names of all such non-defaulting
Underwriters, or in such other proportions as you may specify, to purchase the
Shares which such defaulting Underwriter or Underwriters agreed but failed or
refused to purchase on such date; provided that in no event shall the number of
Shares that any Underwriter has agreed to purchase pursuant to this Agreement be
increased pursuant to this Section 9 by an amount in excess of one-ninth of such
number of Shares without the written consent of such Underwriter. If, on the
Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase
Firm Shares and the aggregate number of Firm Shares with respect to which such
default occurs is more than one-tenth of the aggregate number of Firm Shares to
be purchased, and arrangements satisfactory to you and the Company for the
purchase of such Firm Shares are not made within 36 hours after such default,
this Agreement shall terminate without liability on the part of any
non-defaulting Underwriter or the Company. In any such case either you or the
Company shall have the right to postpone the Closing Date, but in no event for
longer than seven days, in order that the required changes, if any, in the
Registration Statement and in the Prospectus or in any other documents or
arrangements may be effected. If, on the Option Closing Date, any Underwriter or
Underwriters shall fail or refuse to purchase Additional Shares and the
aggregate number of Additional Shares with respect to which such default occurs
is more than one-tenth of the aggregate number of Additional Shares to be
purchased, the non-defaulting Underwriters shall have the option to (i)
terminate their obligation hereunder to purchase Additional Shares or (ii)
purchase not less than the number of Additional Shares that such non-defaulting
Underwriters would have been obligated to purchase in the absence of such
default. Any action taken under this paragraph shall not
19
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relieve any defaulting Underwriter from liability in respect of any default of
such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of them,
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 or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
documented out-of-pocket expenses (including the fees and disbursements of their
counsel) reasonably incurred by such Underwriters in connection with this
Agreement or the offering contemplated hereunder.
10. 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.
11. Applicable Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York.
20
21
12. 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.
Very truly yours,
SCG Holding Corporation
by
------------------------------------
Name:
Title:
Accepted as of the date hereof
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
Acting severally on behalf of itself and the several Underwriters named in
Schedule I hereto.
by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
by
------------------------------------
Name:
Title:
21
22
SCHEDULE I
NUMBER OF
FIRM SHARES
UNDERWRITER TO BE PURCHASED
----------- ---------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
Chase Securities Inc.
▇▇▇▇▇▇ Brothers Inc.
FleetBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
------------------------------------
Total .....................................
====================================
23
EXHIBIT A
[Form of Lock-up Agreement]
___________, 2000
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Dear Sirs and Mesdames:
The undersigned understands that ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated ("▇▇▇▇▇▇ ▇▇▇▇▇▇▇") proposes to enter into an Underwriting Agreement
(the "UNDERWRITING AGREEMENT") with SCG Holding Corporation, a Delaware
corporation (the "COMPANY"), providing for the public offering (the "PUBLIC
OFFERING") by the several Underwriters, including ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ (the
"UNDERWRITERS"), of [ ] shares (the "SHARES") of the common stock, par value
$0.01 per share, of the Company (the "COMMON STOCK").
To induce the Underwriters that may participate in the Public
Offering to continue their efforts in connection with the Public Offering, the
undersigned hereby agrees that, without the prior written consent of ▇▇▇▇▇▇
▇▇▇▇▇▇▇ on behalf of the Underwriters, it will not, during the period commencing
on the date hereof and ending 180 days after the date of the final prospectus
relating to the Public Offering (the "PROSPECTUS"), (1) offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase, lend, or
otherwise transfer or dispose of, directly or indirectly, any shares of Common
Stock or any securities convertible into or exercisable or exchangeable for
Common Stock or (2) enter into any swap or other arrangement that transfers to
another, in whole or in part, any of the economic consequences of ownership of
the Common Stock, whether any such transaction described in clause (1) or (2)
above is to be settled by delivery of Common Stock or such other securities, in
cash or otherwise. The foregoing sentence shall not apply to (a) the sale of any
Shares to the Underwriters pursuant to the Underwriting Agreement, (b)
transactions relating to shares of Common Stock or other securities acquired in
open market transactions after the completion of the Public Offering, (c)
transfers of shares of Common Stock or any security convertible into Common
Stock as a bona fide gift or gifts, (d) distributions of shares of Common Stock
24
or any security convertible into Common Stock to limited partners or
stockholders of the undersigned or (e) transfers and dispositions between one or
more affiliates of Texas Pacific Group or partners, shareholders or members of
any such affiliate, provided, that in the case of any transfer, distribution or
disposition pursuant to clause (c), (d) or (e), (i) each donee, distributee or
disposition recipient shall execute and deliver to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ a duplicate
form of this Lock-up Letter and (ii) if a filing by any party (donor, donee,
transferor, transferee, disposer or disposition recipient) under Section 16(a)
of the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), shall
be required in connection with such transfer, distribution or disposition (other
than a filing on a Form 5 made after the expiration of the 180-day period
referred to above), such party shall provide ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ no less than seven
days prior notice of such filing (it being understood that no such filing shall
be made by any such party if not required to be made under the Exchange Act). In
addition, the undersigned agrees that, without the prior written consent of
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ on behalf of the Underwriters, it will not, during the period
commencing on the date hereof and ending 180 days after the date of the
Prospectus, make any demand for or exercise any right with respect to, the
registration of any shares of Common Stock or any security convertible into or
exercisable or exchangeable for Common Stock.
Whether or not the Public Offering actually occurs depends on
a number of factors, including market conditions. Any Public Offering will only
be made pursuant to an Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriters.
Very truly yours,
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(Name)
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(Address)