THE ▇▇▇▇▇▇▇▇ COMPANIES, INC.
DEALER MANAGER AGREEMENT
November 17, 2005
▇▇▇▇▇▇ BROTHERS INC.
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
▇▇▇▇▇▇ Brothers Inc.
▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
Four World Financial Center
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
1. General. The ▇▇▇▇▇▇▇▇ Companies, Inc., a Delaware corporation (the
"COMPANY"), plans to make an offer (the "OFFER") to pay a cash premium to
holders of any and all of up to $299,987,000 aggregate principal amount of the
Company's outstanding 5.50% Junior Subordinated Convertible Debentures due 2033
(the "SECURITIES") who elect to convert their Securities to shares of the
Company's common stock ("COMPANY SHARES") in accordance with the terms of the
Securities and upon the terms and subject to the conditions set forth in the
Preliminary Conversion Offer Prospectus dated the date hereof and included in
the Registration Statement (as defined below) (and as amended or supplemented
from time to time prior to effectiveness of the Registration Statement, the
"PRELIMINARY PROSPECTUS"), and the related Letter of Transmittal (the "LETTER OF
TRANSMITTAL") dated the date hereof and filed as Exhibit 99.1 to the
Registration Statement.
The following materials to be used by the Company in connection with the
Offer, as any of them may be amended, modified or supplemented from time to
time, are collectively referred to herein as the "OFFER MATERIAL":
(a) The Company's Registration Statement on Form S-4 filed with the
Securities and Exchange Commission (the "COMMISSION") on November 17, 2005 in
accordance with the Securities Act of 1933, as amended, and the rules and
regulations of the Commission thereunder (collectively, the "1933 ACT"),
relating to the Offer and the issuance of the Company Shares in connection
therewith. As used in this agreement (the "DEALER MANAGER AGREEMENT" or this
"AGREEMENT"), the term "REGISTRATION STATEMENT" means such registration
statement, including all exhibits, financial statements, schedules or other
information included or incorporated by reference therein, when it becomes
effective under the 1933 Act, and as amended or supplemented from time to time.
(b) The Company's Conversion Offer Prospectus relating to the Offer and
the Company Shares to be issued in connection therewith. As used in this
Agreement, the term "PROSPECTUS" means (i) any prospectus, as amended or
supplemented on or prior to the Acceptance Date (as defined below) (including,
but not limited to, the Preliminary Prospectus) that the Company uses, prepares,
files, distributes or approves in writing which is used to solicit tenders of
Securities in the Offer, or (ii) after the effectiveness of the Registration
Statement, the prospectus, if any, filed with the Commission pursuant to Rule
424(b) under the 1933 Act, in the form it was first filed, provided that such
prospectus was used to solicit tenders of Securities in the Offer on or prior to
the Acceptance Date. All references in this Agreement to financial statements
and schedules and other information which is "contained", "included" or "stated"
in the Registration Statement, any preliminary prospectus or the Prospectus (or
other references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which is incorporated,
or deemed to be incorporated, by reference in the Registration Statement, any
preliminary prospectus or the Prospectus, as the case may be. Any reference
herein to the Registration Statement or the Prospectus shall be deemed to refer
to and include any documents, financial statements and schedules incorporated,
or deemed to be incorporated, by reference therein pursuant to Form S-4 under
the 1933 Act, as of the effective date of the Registration Statement or the date
of the Prospectus, as the case may be, and any reference to any amendment or
supplement to the Registration Statement or the Prospectus shall be deemed to
refer to and include any documents, financial statements and schedules filed
after such date under the Securities Exchange Act of 1934, as amended, and the
rules and regulations of the Commission thereunder (collectively, the "1934
ACT") and so incorporated, or deemed to be incorporated, by reference (such
incorporated documents, financial statements and schedules being herein called
the "INCORPORATED DOCUMENTS"). For purposes of this Agreement, all references to
the Registration Statement, any preliminary prospectus, the Prospectus or any
amendment or supplement to any of the foregoing shall be deemed to include the
copy filed with the Commission pursuant to its Electronic Data Gathering,
Analysis and Retrieval system ("▇▇▇▇▇").
(c) The Tender Offer Statement on Schedule TO (the "SCHEDULE TO") filed
or to be filed by the Company with the Commission pursuant to Rule 13e-4 under
the 1934 Act and all amendments to the Schedule TO (each an
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"AMENDMENT" and, collectively, the "AMENDMENTS") and the Letter of Transmittal.
(d) The Guidelines for Certification of Taxpayer Identification Number
on Substitute Form W-9 relating to the Offer.
(e) The form of letter to Registered Holders and The Depository Trust
Company Participants relating to the Offer, and the form of letter to Clients of
Registered Holders and The Depository Trust Company Participants relating to the
Offer.
(f) Any other documents or materials whatsoever (including newspaper
announcements and press releases) relating to the Offer that are distributed or
made available to the public or the holders of the Securities by or at the
direction of the Company in connection with the Offer.
2. Engagement as Dealer Managers. (a) The Company hereby retains each of
▇▇▇▇▇▇ Brothers Inc., ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. and ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ &
▇▇▇▇▇ Incorporated to act as the exclusive dealer managers with respect to the
Offer (each a "DEALER MANAGER" and together, the "DEALER MANAGERS"). On the
basis of the representations and warranties and agreements of the Company herein
contained and subject to and in accordance with the terms and conditions hereof
and of the Offer Material, you hereby agree to act as Dealer Managers in
connection with the Offer and in connection therewith, you shall act in
accordance with your customary practices and shall perform those services in
connection with the Offer that are customarily performed by investment banking
firms in connection with acting as a dealer manager of transactions of a like
nature, including, but not limited to, soliciting conversions pursuant to the
Offer and communicating generally regarding the Offer with brokers, dealers,
commercial banks and trust companies and other persons, including the holders of
the Securities. The Dealer Managers shall have no obligation to cause copies of
the Offer Material to be transmitted generally to the holders of the Securities.
(b) The Company acknowledges and agrees that each of the Dealer
Managers has been retained hereunder to act solely as a Dealer Manager. In such
capacity, each of the Dealer Managers shall act hereunder as an independent
contractor and shall not be deemed the agent or fiduciary of the Company or any
of its affiliates, equity holders or creditors or of any other person, and any
of the duties of the Dealer Managers arising out of the Dealer Managers'
engagement pursuant to this Agreement shall be owed solely to the Company. None
of the Dealer Managers shall be liable to the Company, its affiliates, equity
holders or creditors or to any other person for any act or omission on the part
of, and shall not be deemed to be the agent or fiduciary of, any broker or
dealer, commercial bank or trust company and no such broker or dealer,
commercial bank or trust company shall be deemed to be acting as the agent or
fiduciary of any of the
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Dealer Managers (including, without limitation, for purposes of Section 10 of
this Agreement). Nothing contained in this Agreement shall constitute any of the
Dealer Managers a partner of or joint venturer with the Company.
3. Solicitation Material, Withdrawal. The Company agrees to furnish you
with as many copies as you may reasonably request of any Offer Material, and
hereby authorizes you to use the Offer Material in connection with the Offer.
The Company agrees that, within a reasonable time prior to using any Offer
Material, it will submit copies of such material to you and your counsel and
will not use or publish any such material to which you reasonably object. The
Company agrees that the Offer Material have been or will be prepared and
approved by, and are the sole responsibility of, the Company. The Company shall
inform you promptly after it receives notice or becomes aware of the happening
of any event, or the discovery of any fact, that would require the making of any
change in any Offer Material then being used or that would affect the accuracy
or completeness of any representation or warranty contained in this Agreement if
such representation or warranty were being made immediately after the happening
of such event or the discovery of such fact.
In the event that (i) the Company uses or permits the use of any Offer
Material (a) that has not been submitted to you and your counsel for comment or
(b) that has been so submitted and with respect to which you or your counsel
have made comments, but which comments have not resulted in a response
reasonably satisfactory to you to reflect such comments, (ii) the Company shall
have breached any of its representations, warranties, agreements, obligations or
covenants contained herein, (iii) there shall have occurred any material adverse
change, or any development or event involving a material adverse change, in the
financial condition, results of operations, business or prospects of the Company
and its subsidiaries, taken as a whole (a "MATERIAL ADVERSE CHANGE"), that, in
your judgment, makes it impracticable or inadvisable to carry out the Offer, the
conversion of Securities pursuant thereto or the performance of this Agreement,
(iv) the Offer is terminated or withdrawn for any reason other than as a result
of the gross negligence, bad faith or willful misconduct of any Dealer Manager
or (v) any stop order, restraining order, injunction or denial of an application
for approval has been issued in connection with the Offer and not thereafter
stayed or vacated or any proceeding, litigation or investigation in connection
with the Offer has been initiated, that, in either case in your judgment, makes
it impracticable or inadvisable to carry out the Offer, the conversion of
Securities pursuant thereto or the performance of this Agreement, then in any
such case you shall be entitled to withdraw as a Dealer Manager, by providing
written notice of such withdrawal to the Company, without any liability or
penalty to you or any other Indemnified Party (as defined in Section 10) and
without loss of any right to the payment of all expenses payable in accordance
with Section 5 hereunder which have been incurred by you to the date of such
withdrawal. If you withdraw as a Dealer Manager in accordance with the foregoing
provision, the reimbursement for your
4
expenses through the date of such withdrawal shall be paid to you promptly after
such date. Notwithstanding anything contained in this Agreement to the contrary,
the Company may, in its discretion, carry out the Offer after your withdrawal as
Dealer Manager, provided that the Company (y) amends or supplements the Offer
Material to disclose that you have withdrawn as Dealer Manager and (z) utilizes
a means reasonably calculated to reach holders of the Securities to inform them
of such withdrawal.
4. Compensation. The Company agrees that it will pay all of the
compensation due to the Dealer Managers for their services as Dealer Managers
hereunder and agrees that such compensation will be as set forth in Schedule I
hereto and that such compensation will be paid in cash immediately upon the
completion of the Offer.
5. Expenses. The Company agrees that it will pay all of the following
expenses related to the Offer: (i) all fees and expenses relating to the
preparation, printing, mailing and publishing of the Offer Material, including
the cost of preparation and filing of the Registration Statement and any
amendment thereto and Schedule TO and any Amendments thereto, and the cost of
furnishing copies thereof to the Dealer Managers, (ii) all fees and expenses of
the Company's counsel and accountants and of the Conversion Agent and
Information Agent (each as defined in Section 6), (iii) all advertising charges,
(iv) all fees and expenses of any depositary, transfer agent, conversion agent
or other person rendering services in connection with the Offer, (v) mailing and
handling expenses incurred by brokers and dealers (including you), commercial
banks, trust companies and other nominees in forwarding the Offer Material to
their customers, (vi) the cost of the preparation, issuance and delivery of the
Company Shares issued upon conversion of Securities, including any and all
transfer and other taxes payable thereon, except as otherwise stated in the
Letter of Transmittal, (vii) all expenses in connection with the qualification
of the Company Shares for offer and delivery, (viii) all costs and expenses
incident to the additional listing of the Company Shares on the New York Stock
Exchange, (ix) all fees and expenses of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇ as counsel to the
Dealer Managers and (x) 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 5. All payments to be made by the Company pursuant to this
Section 5 shall be made promptly after the expiration or termination of the
Offer or withdrawal by you from acting as Dealer Managers in accordance with
Section 3 or, if later, promptly after the related fees or expenses accrue and
are invoiced. The Company shall perform its obligations set forth in this
Section 5 whether or not the Offer is commenced or the Company acquires any
Securities pursuant to the Offer or otherwise.
6. Conversion Agent and Information Agent. (a) The Company will arrange
for JPMorgan Chase Bank, National Association, a national banking
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association, to serve as conversion agent (the "CONVERSION AGENT") in connection
with the Offer and, as such, to advise you at least daily as to such matters
relating to the Offer as you may request. The Company shall provide you or cause
The Depository Trust Company ("DTC") to provide you with copies of the records
or other lists showing the names and addresses of, and number of Securities held
by, the holders of Securities as of a recent date and shall, from and after such
date, use its commercially reasonable efforts to cause you to be advised from
day to day during the pendency of the Offer of all transfers of Securities, such
notification consisting of the name and address of the transferor and transferee
of any Securities and the date of such transfer. The Company will arrange for
▇.▇. ▇▇▇▇ & Co., Inc., to serve as information agent ("INFORMATION AGENT") in
connection with the Offer and, as such, to advise you as to such matters
relating to the Offer as you may reasonably request and to furnish you with any
written reports concerning any such information as you may reasonably request.
(b) The Company authorizes you to communicate with the Conversion Agent,
the Information Agent and with DTC in its capacity as depositary, with respect
to matters relating to the Offer.
7. Representations, Warranties and Certain Agreements of the Company. The
Company represents and warrants to each of the Dealer Managers, and agrees with
each of the Dealer Managers, as of the date hereof, as of the date of
commencement of the Offer pursuant to Section 13(e) of the 1934 Act (if
different from the date hereof) (the "COMMENCEMENT DATE") and as of the date on
which the Securities are accepted by the Company pursuant to the Offer (the
"ACCEPTANCE DATE") (unless another date is specifically referenced in which case
the representation and warranty shall speak as of such date):
(a) Compliance with Registration Requirements. The Company meets the
requirements for use of Form S-4 under the 1933 Act and, on or prior to the
Commencement Date, has filed with the Commission the Registration Statement and
paid the applicable filing fees. As of the Acceptance Date, the Registration
Statement and any post-effective amendment thereto have become effective under
the 1933 Act and no stop order suspending the effectiveness of the Registration
Statement and any post-effective amendment thereto has been issued under the
1933 Act and no proceedings for that purpose have been instituted or are pending
or, to the knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for additional information has been
complied with.
At the respective times the Registration Statement and any post-effective
amendments thereto become effective and at the Acceptance Date, the Registration
Statement and any amendments thereto will comply in all material respects with
the requirements of the 1933 Act and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
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therein or necessary to make the statements therein not misleading. Neither the
Prospectus nor any amendments and supplements thereto included or will include
an untrue statement of a material fact or omitted or will omit to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading, except that the
foregoing does not apply to statements in or omissions from any of such
documents based upon written information furnished to the Company by you or on
your behalf specifically for use therein.
Each preliminary prospectus and prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment thereto,
complied when so filed in all material respects with the 1933 Act and each
preliminary prospectus and the Prospectus prepared for use in connection with
the Offer will, at the time of such delivery, be identical to any electronically
transmitted copies thereof filed with the Commission pursuant to ▇▇▇▇▇, except
to the extent permitted by Regulation S-T.
(b) Offer Material. A complete and correct copy of the Offer Material has
been furnished to you and your counsel or will be furnished no later than the
Commencement Date. The Offer Material, as then amended or supplemented (other
than the Prospectus and the Registration Statement, and any amendments and
supplements thereto, which are covered in subsection (a) above), complied and
will comply in all material respects with the requirements of the 1933 Act and
the 1934 Act, as applicable, and did not and 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 not misleading.
Neither the Offer Material nor any amendments or supplements thereto (other than
the Prospectus and the Registration Statement, and any amendments and
supplements thereto, which are covered in subsection (a) above) included or will
include an untrue statement of a material fact or omitted or will omit to state
a material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading.
(c) Incorporated Documents. The Company has filed all documents with the
Commission that it is required to file under the 1933 Act and the 1934 Act, as
applicable; the Incorporated Documents, at the time they were or hereafter are
filed with the Commission, complied and will comply in all material respects
with the requirements of the 1934 Act, and, when read together with the other
information in the Prospectus, at the date of the Prospectus and at the
Acceptance Date, did not and will not include an untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
(d) Financial Statements. The financial statements of the Company,
together with the related schedules and notes to such financial statements,
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included in the Registration Statement and the Prospectus present fairly in all
material respects 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 except as otherwise disclosed in the
Prospectus, such financial statements comply as to form with the applicable
accounting requirements of the 1933 Act and have been prepared in conformity
with generally accepted accounting principles ("GAAP") in the United States
applied on a consistent basis throughout the periods involved (except as stated
therein); and any schedules included in the Registration Statement present
fairly in all material respects in accordance with GAAP the information required
to be stated therein. The selected historical financial data set forth under the
caption "Selected Historical Consolidated Financial Data" in the Prospectus
present fairly the information shown therein and have been compiled as described
in the Prospectus under the caption "Selected Historical Consolidated Financial
Data."
(e) Independent Accountants. Ernst & Young LLP, who have reported upon the
audited financial statements and schedules included or incorporated by reference
in the Prospectus, are independent public auditors with respect to the Company
within the meaning of the rules and regulations promulgated under the 1933 Act.
(f) No Material Adverse Change in Business. Other than as may be set forth
in the Prospectus, neither the Company nor any of its Significant Subsidiaries
has sustained, since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus, any loss or
interference with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court or
governmental action, order or decree, which would be reasonably likely to result
in any Material Adverse Effect, or any development involving a material adverse
change in or affecting the financial condition, results of operations, business
or prospects of the Company and its subsidiaries, taken as a whole, otherwise
than as may be set forth or contemplated in the Prospectus, and, since the
respective dates as of which information is given in the Prospectus or since the
date of the Prospectus, there has not been (i) any material change in the
capital stock or long-term debt of the Company or any of its subsidiaries, (ii)
any material adverse change in or affecting the financial condition, results of
operations, business or prospects of the Company and its subsidiaries, taken as
a whole or (iii) any transaction entered into by the Company or any of its
Significant Subsidiaries, other than in the ordinary course of business, that is
material to the Company and its subsidiaries, taken as a whole, otherwise than
as disclosed, in each case, in the Prospectus.
(g) Good Standing of the Company. 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
8
qualified to do 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 financial
condition, results of operations, business or prospects of the Company and its
subsidiaries, taken as a whole (a "MATERIAL ADVERSE EFFECT").
(h) Good Standing of Subsidiaries. Each significant subsidiary of the
Company (as defined in Rule 1-02 of Regulation S-X under the 1933 Act (each, a
"SIGNIFICANT SUBSIDIARY" and collectively, the "SIGNIFICANT SUBSIDIARIES") has
been duly organized or validly formed, is validly existing and in good standing
under the laws of the jurisdiction of its formation or incorporation, has the
power (corporate or other) and authority to own its property and to conduct its
business as described in the Prospectus and is duly qualified to do 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; all of the issued and outstanding shares of capital
stock or other equity interests of each Significant Subsidiary have been duly
authorized and validly issued and, if applicable, are fully paid and
nonassessable and, except as disclosed in the Prospectus, are owned directly or
indirectly by the Company, free and clear of all liens encumbrances, equities
and claims.
(i) Capital Stock. The Company has an authorized capitalization as set
forth in the Prospectus and Offer Material; all of the issued shares of capital
stock of the Company have been duly authorized and validly issued, are fully
paid and nonassessable, and conform to the description thereof contained in the
Prospectus and Offer Material; and none of such shares of capital stock was
issued in violation of preemptive or other similar rights of any securityholder
of the Company.
(j) Authorization of this Agreement. This Agreement has been duly
authorized, executed and delivered by the Company.
(k) Authorization of Company Shares. The Company has duly authorized for
issuance a sufficient number of Company Shares to be issued on conversion of the
Securities as contemplated by the Offer pursuant to its terms and, when any
Company Shares are issued and delivered by the Company pursuant to the terms of
the Indenture dated as of May 28, 2003 among the Company and JPMorgan Chase
Bank, as trustee, and as provided in the Offer Material, such Company Shares
will be validly issued and fully paid and non-assessable; the Company Shares
conform in all material respects to the respective statements relating thereto
contained in the Prospectus and Offer Material and the issuance of the Company
Shares by the Company is not subject to any preemptive or other similar rights
of any security holder of the Company.
9
(l) Noncontravention. The Company has full power and authority to make and
consummate the Offer in accordance with its terms and to execute, deliver and
perform its obligations under this Agreement. The (i) execution, delivery and
performance by the Company of this Agreement, (ii) making and consummation of
the Offer by the Company (including but not limited to the issuance and delivery
of Company Shares thereunder), (iii) obtaining and use by the Company of funds
required in connection with the Offer, (iv) use of the Offer Material and the
filing of the Registration Statement, the Prospectus and the Schedule TO, and
any amendments or supplements thereto and (v) consummation by the Company of the
transactions contemplated by this Agreement and in the Offer Material, in each
case, have been duly authorized by all necessary action (corporate or other) on
the part of the Company and do not and will not (x) result in any violation of
the charter or by-laws of the Company or (y) conflict with, or result in a
breach of any of the terms or provisions of, or constitute a default or result
in the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company under, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which the Company or any of
its affiliates is a party or by which the Company or any of its affiliates is
bound (except for such conflicts, breaches or defaults, in the case of this
clause (y), that would not reasonably be expected to have a Material Adverse
Effect), nor does or will such action result in any violation of any statute
applicable to the Company or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or any of its
properties.
(m) Absence of Proceedings. Other than as set forth or incorporated by
reference in the Prospectus, there is no action, suit or proceeding before or by
any government, governmental instrumentality or court, domestic or foreign, now
pending or, to the knowledge of the Company, threatened against or affecting the
Company or any Significant Subsidiary or to which any of their respective
properties are subject that would reasonably be expected to result in any
Material Adverse Effect, or that would reasonably be expected to adversely
affect the consummation of the Offer or the other transactions contemplated in
this Agreement.
(n) Absence of Further Requirements. No consent, approval, authorization,
order, registration or qualification of or with any such court or governmental
agency or body having jurisdiction over the Company or any of its properties is
required for the execution, delivery and performance by the Company of this
Agreement, in connection with the consummation of the Offer or the other
transactions described in the Offer Material by the Company, except as may be
required by the securities or Blue Sky laws of the various states in connection
with the Offer.
(o) Possession of Licenses and Permits. The Company and its Significant
Subsidiaries each have obtained all consents, authorizations,
10
approvals, orders, certificates and permits of and from, and has made all
declarations and filings with, all federal, state, local and other governmental
authorities, and all courts or other tribunals (collectively, the "LICENSES")
necessary to own, hold, or lease, as the case may be, and to operate its
properties and to carry on its business as presently conducted, except where the
failure to possess such Licenses would not reasonably be expected to have a
Material Adverse Effect, and neither the Company nor any of its Significant
Subsidiaries has received any written notice of proceedings relating to
revocation or modification of any such Licenses, except to the extent that any
such revocation or modification would not have a Material Adverse Effect.
(p) Sufficient Funds. The funds to be made available by the Company for
consummation of the Offer as described in the Offer Material are available or
will be available to the Company by the Acceptance Date and the Company will
have sufficient authority under applicable law to use such funds as described to
enable the Company promptly to pay the cash consideration for the Securities
pursuant to the Offer as described in the Prospectus.
(q) Officers' Certificates. Any certificate signed by any officer of the
Company delivered to you or to your counsel and requested in writing with
respect to this Agreement shall be deemed a representation and warranty by the
Company to each Dealer Manager as to the matters covered thereby.
(r) Absence of Defaults and Conflicts. The Company is not (i) in violation
of its charter or by-laws, as applicable, (ii) in default, and no event has
occurred which, with notice or lapse of time or both, would constitute such a
default, in the due performance or observance of any term, obligation,
agreement, covenant or condition contained in any material contract, indenture,
mortgage, deed of trust, loan agreement, lease or other agreement or instrument
to which it is a party or by which it is bound or which any of its properties or
assets may be subject or (iii) in violation of any law, ordinance, governmental
rule, regulation or court decree to which it or its property or assets may be
subject, except with respect to (ii) or (iii), for any such violations or
defaults that would not be reasonably likely, singly or in the aggregate, to
have a Material Adverse Effect.
(s) Compliance with Environmental Laws. (i) Each of the Company and its
Significant Subsidiaries (A) is 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"), (B) has
received all permits, licenses or other approvals required of it under
applicable Environmental Laws to conduct its business as presently conducted and
(C) is in compliance with all terms and conditions of any such permit, license
or approval, except, with respect to (A), (B) and (C), as may be disclosed in
the Prospectus and except where such noncompliance with Environmental Laws,
failure to receive required
11
permits, licenses or other approvals or failure to comply with the terms and
conditions of such permits, licenses or approvals would not be reasonably likely
to, singly or in the aggregate, have a Material Adverse Effect.
(ii) There has been no storage, disposal, generation,
manufacture, refinement, transportation, handling or treatment of
toxic wastes, medical wastes, hazardous wastes or hazardous
substances by the Company or any of its Significant Subsidiaries
(or, to the knowledge of the Company, any of their predecessors in
interest) at, upon or from any of the property now or previously
owned or leased by the Company or its Significant Subsidiaries in
violation of any applicable law, ordinance, rule, regulation,
order, judgment, decree or permit or which would require remedial
action under any applicable law, ordinance, rule, regulation,
order, judgment, decree or permit, except as may be disclosed in
the Prospectus and except for any violation or remedial action
which would not be reasonably likely to have, singularly or in the
aggregate, a Material Adverse Effect; there has been no material
spill, discharge, leak, emission, injection, escape, dumping or
release of any kind onto such property or into the environment
surrounding such property of any toxic wastes, medical wastes,
solid wastes, hazardous wastes or hazardous substances due to or
caused by the Company or any of its Significant Subsidiaries or
with respect to which the Company or any of its Significant
Subsidiaries have knowledge, except as may be set forth in the
Prospectus, and except for any such spill, discharge, leak,
emission, injection, escape, dumping or release which would not be
reasonably likely to have, singularly or in the aggregate, a
Material Adverse Effect; and the terms "hazardous wastes", "toxic
wastes", "hazardous substances" and "medical wastes" shall have the
meanings specified in any applicable local, state, federal and
foreign laws or regulations with respect to environmental
protection
(t) Internal Controls. The Company (i) makes and keeps books and records
which accurately reflect transactions and dispositions of the Company's assets
and (ii) maintains internal accounting controls which provide reasonable
assurance that (A) transactions are executed in accordance with management's
general or specific authorization, (B) transactions are recorded as necessary to
permit preparation of its financial statements and to maintain accountability
for its assets, and (C) access to its assets is permitted only in accordance
with management's general or specific authorization.
(u) Disclosure Controls and Procedures. (i) (A) The Company has
established and maintains disclosure controls and procedures (as such terms are
12
defined in Rules 13a-15(e) and 15d-15(e) under the 1934 Act); (B) such
disclosure controls and procedures are designed to ensure that information
required to be disclosed by the Company in the reports it files or submits under
the 1934 Act is accumulated and communicated to the Company's management,
including its principal executive officer and its principal financial officer,
as appropriate, to allow timely decisions regarding required disclosure; and (C)
such disclosure controls and procedures are effective at a reasonable assurance
level to perform the functions for which they were established.
(ii) Since the date of the filing of the Company's
Quarterly Report on Form 10-Q for the quarter ended September 30,
2005, as amended, the Company's auditors and the audit committee of
the board of directors of the Company (or persons fulfilling the
equivalent function) have not been advised of (i) any significant
deficiencies or material weaknesses in the design or operation of
internal controls over financial reporting which are reasonably
likely to adversely affect the Company's ability to record,
process, summarize and report financial data; and (ii) any fraud,
whether or not material, that involves management or other
employees who have a significant role in the Company's internal
controls over financial reporting.
(iii) Since the date of the filing of the Company's
Quarterly Report on Form 10-Q for the quarter ended September 30,
2005, as amended there have been no material changes in internal
controls over financial reporting that have materially affected or
are reasonably likely to materially affect internal controls over
financial reporting, including any corrective actions with regard
to significant deficiencies and material weaknesses.
(v) Investment Company Act. The Company is not and, after giving effect to
the issuance of the Company Shares in connection with the Offer, will not be an
"investment company" required to be registered under the Investment Company Act
of 1940, as amended.
(w) ERISA Compliance. Except as disclosed in the Offer Material, the
Company is in compliance in all material respects with all presently applicable
provisions of the Employee Retirement Income Security Act of 1974, as amended,
including the regulations and published interpretations thereunder ("ERISA"); no
Reportable Event has occurred with respect to any "pension plan" (as defined by
ERISA) for which the Company would have any material liability; the Company has
not incurred and does not expect to incur material liability under (i) Title IV
of ERISA with respect to termination of, or withdrawal from, any "pension plan"
or (ii) Sections 412 or 4971 of the Internal Revenue Code of 1986, as amended,
including the regulations and published interpretations thereunder
13
(the "CODE"); and each "pension plan" for which the Company would have any
liability that is intended to be qualified under Section 401(a) of the Code is
so qualified in all material respects and nothing has occurred, whether by
action or by failure to act, which would reasonably be expected to cause the
loss of such qualification. "REPORTABLE EVENT" means any of the events set forth
in Section 4043(c) of ERISA, other than those events described in Section
4043(c)(3) and other than those events as to which the thirty day notice period
is waived under subsections .22, .24 (solely with respect to partial termination
of a Plan), .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC Reg.Section 4043).
(x) Insurance. The Company and its Significant Subsidiaries carry, or are
covered by, insurance in such amounts and covering such risks as is reasonable
in accordance with customary practices for companies of a similar size engaged
in similar businesses in similar industries for the conduct of their respective
businesses and the value of their properties.
(y) Listing. The Company Shares have been approved for listing on the New
York Stock Exchange.
8. Additional Agreements. (a) The Company shall notify you immediately
and, if requested, shall notify you in writing of (i) when the Registration
Statement has become effective and when any Prospectus is mailed (or otherwise
sent) for filing pursuant to Rule 424 under the 1933 Act, (ii) the receipt of
any comments from the Commission, (iii) any request by the Commission for any
amendment to the Registration Statement or any amendment or supplement to the
Prospectus or for additional information, (iv) the filing of any post-effective
amendment to the Registration Statement, (v) the issuance by the Commission of
any stop order suspending the effectiveness of the Registration Statement or any
post-effective amendment thereto or of any order preventing or suspending the
use of the Preliminary Prospectus or any Offer Material, or of the suspension of
the qualification of the Securities for offering or sale in any jurisdiction, or
of the initiation or threatening of any proceedings for any of such purposes,
(vi) the occurrence of any event that would reasonably be expected to cause the
Company to withdraw or terminate the Offer or would permit the Company to
exercise any right not to accept tendered Securities, (vii) any proposal or
requirement to make, amend or supplement any other Offer Material, (viii) the
commencement of any material litigation or the issuance of any order or the
taking of any other action by any administrative or judicial tribunal or other
governmental agency or instrumentality concerning the Offer (and, if in writing,
will furnish you a copy thereof), (ix) the issuance by any state securities
commission or other regulatory authority of any order suspending the
qualification or the exemption from qualification of the Company Shares under
state securities or blue sky laws or the initiation or threatening of any
proceeding for that purpose, (x) the occurrence of any event, or the discovery
of any fact, the occurrence or existence of which would reasonably be expected
to (a) cause the
14
Company to amend, withdraw or terminate the Offer, (b) cause any representation
or warranty contained in this Agreement to be untrue or inaccurate, or (c)
permit the Company to exercise any right not to convert the Securities tendered
under the Offer (and the Company will so advise you before such rights are
exercised) and (xi) any other information relating to the Offer which you may
from time to time reasonably request.
The Company agrees that if any event occurs or condition exists as a
result of which the Offer Material (other than the Registration Statement and
the Prospectus, which are discussed in Section 8(g) below) 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 existing
when the Offer Material is delivered to a holder of Securities, not misleading,
or if, in the opinion of the Company, after consultation with you, it is
necessary at any time to amend or supplement the Offer Material to comply with
applicable law, the Company shall immediately notify you, prepare an amendment
or supplement to the Offer Material that will correct such statement or omission
or effect such compliance and supply such amended or supplemented Offer Material
to you.
(b) The Company will promptly effect the filings necessary pursuant to
Rule 424 and will take such steps as it deems necessary to ascertain promptly
whether the Prospectus transmitted for filing under Rule 424 was received for
filing by the Commission and, in the event that it was not, it will promptly
file the Prospectus. The Company will make every reasonable effort to prevent
the issuance of any stop order and, if any stop order is issued, will make every
reasonable effort to obtain the lifting thereof at the earliest possible moment.
The Company will file promptly all reports or information statements
required to be filed with the Commission pursuant to Section 13(a), 13(c), 14 or
15(d) of the 1934 Act subsequent to the date of the Preliminary Prospectus and
for so long as the delivery of a prospectus is required in connection with the
Offer. The Company will promptly file with the Commission on the Commencement
Date a Schedule TO and will promptly file as required any and all necessary
Amendments.
(c) Commencing on the Commencement Date, the Company will cause to be
delivered to each registered holder of the Securities, as soon practicable, a
copy of the Preliminary Prospectus and Letter of Transmittal and all other
appropriate Offer Material. Thereafter, to the extent practicable until the
expiration or termination of the Offer, the Company will use its best efforts to
cause copies of such material to be mailed to each person who becomes a
registered holder of any Company Shares.
(d) The Company will give you notice of its intention to file or prepare
any amendment to the Registration Statement (including any filing under Rule
15
462(b) of the 1933 Act regulations), or any amendment, supplement or revision to
either the prospectus included in the Registration Statement at the time it
became effective or to the Prospectus, whether pursuant to the 1933 Act, the
1934 Act or otherwise, will furnish you with copies of any such documents a
reasonable amount of time prior to such proposed filing or use, as the case may
be, and will not file or use any such document to which you shall reasonably
object in writing.
(e) The Company has furnished or will deliver to you, without charge, one
conformed copy of the Registration Statement as originally filed and of each
amendment thereto (including exhibits filed therewith or incorporated by
reference therein and documents incorporated or deemed to be incorporated by
reference therein) and conformed copies of all consents and certificates of
experts, and will also deliver to you, without charge, as many conformed copies
of the Registration Statement as originally filed and of each amendment thereto
(without exhibits) as you may reasonably request. The Company further agrees
that the Registration Statement and each amendment thereto furnished to you will
be identical to any electronically transmitted copies thereof filed with the
Commission pursuant to ▇▇▇▇▇, except to the extent permitted by Regulation S-T.
(f) The Company will deliver to you, without charge, as many copies of the
Prospectus as you may reasonably request, and the Company hereby consents to the
use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to you, without charge, during the period when the Prospectus is
required to be delivered under the 1933 Act or the 1934 Act, such number of
copies of the Prospectus as you may reasonably request. The Company further
agrees that the Prospectus and any amendments or supplements thereto furnished
to you will be identical to any electronically transmitted copies thereof filed
with the Commission pursuant to ▇▇▇▇▇, except to the extent permitted by
Regulation S-T.
(g) The Company will comply with the 1933 Act and the 1934 Act so as to
permit the completion of the distribution of the Company Shares as contemplated
in this Agreement and in the Registration Statement and the Prospectus. If at
any time when the Prospectus is required by the 1933 Act or the 1934 Act to be
delivered in connection with the distribution of the Company Shares, any event
shall occur or condition shall exist as a result of which it is necessary, in
the opinion of your counsel or counsel for the Company, to amend the
Registration Statement in order that the Registration Statement 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 not misleading
or to amend or supplement the Prospectus in order that the Prospectus will not
include an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances existing at the time it is delivered to a holder of Securities,
not
16
misleading, or if it shall be necessary, in the opinion of such counsel, at any
such time to amend the Registration Statement or amend or supplement the
Prospectus in order to comply with the requirements of the 1933 Act, the Company
will promptly prepare and file with the Commission, subject to the terms of this
Agreement, such amendment or supplement as may be necessary to correct such
statement or omission or to make the Registration Statement or the Prospectus
comply with such requirements, and the Company will furnish to you, without
charge, such number of copies of such amendment or supplement as you may
reasonably request.
(h) The Company will use its commercially reasonable efforts, in
cooperation with you and in accordance with Rule 13e-4 of the 1934 Act, to
qualify the Company Shares for offering and sale under the applicable securities
laws of such states and other jurisdictions (domestic or foreign) as you and the
Company may reasonably designate and to maintain such qualifications in effect
for a period of not less than one year from the date of this Agreement;
provided, however, that the Company shall not be obligated to file any general
consent to service of process or to qualify as a foreign corporation or as a
dealer in securities in any jurisdiction in which it is not so qualified or to
subject itself to taxation in respect of doing business in any jurisdiction in
which it is not otherwise so subject. In each jurisdiction in which the Company
Shares have been so qualified, the Company will file such statements and reports
as may be required by the laws of such jurisdiction to continue such
qualification in effect for a period of not less than one year from the date of
this Agreement.
(i) The Company will not, directly or indirectly, distribute the Offer
Material to any holder of Securities in or from any jurisdiction outside the
United States, or otherwise extend the Offer to any holder of Securities
residing in any jurisdiction outside the United States, except under
circumstances that will result in compliance with the applicable laws and
regulations of such jurisdiction.
(j) The Company will timely file such reports pursuant to the 1934 Act as
are necessary in order to make generally available to its security holders as
soon as practicable an earnings statement for the purposes of, and to provide
the benefits contemplated by, the last paragraph of Section 11(a) of the 1933
Act.
(k) On or prior to the Commencement Date, the Company will have entered
into agreements with the Information Agent and the Conversion Agent and will
have made appropriate arrangements, to the extent applicable, with DTC or any
other "qualified" securities depositary to allow for the book-entry movement of
the tendered Securities between depositary participants and the Conversion
Agent.
9. Documentary Covenants. (a) The Company covenants that it shall, on the
Commencement Date, deliver or cause to be delivered to you each of (i)
17
the signed opinion, dated the Commencement Date, of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.,
Senior Vice President and General Counsel of the Company, and the signed opinion
and letter, each dated the Commencement Date, of ▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP,
counsel for the Company, each substantially in the form set forth in Exhibits A,
B and C hereto with customary qualifications, assumptions and exceptions
reasonably satisfactory to you, (ii) a certificate of the Treasurer of the
Company and the chief financial officer or chief accounting officer of the
Company, dated as of the Commencement Date, to the effect that, (y) the Company
Shares have been duly approved for listing on the New York Stock Exchange and
(z) since the date of the most recent financial statements included or
incorporated by reference in the Registration Statement and the Prospectus,
there has been no Material Adverse Change (other than as set forth in the
Prospectus), (iii) a certificate, dated the Commencement Date, of the Secretary
of the Company in form and substance reasonably satisfactory to you and (iv) a
letter from Ernst & Young LLP, dated as of the Commencement Date, in form and
substance reasonably satisfactory to you, containing statements and information
of the type ordinarily included in accountants' "comfort letters" with respect
to the financial statements and certain financial information contained in the
Registration Statement and the Prospectus.
(b) Unless you have previously withdrawn as Dealer Managers, the Company
covenants that it shall, on the Acceptance Date, deliver or cause to be
delivered to you each of the documents listed in clauses (i) through (v) below
and that it will not accept Securities tendered pursuant to the Offer unless on
such Acceptance Date: (i) the signed opinion, dated the Acceptance Date, of
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq., Senior Vice President and General Counsel of the Company,
and the signed opinion and letter, each dated the Acceptance Date, of ▇▇▇▇▇▇,
▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, counsel for the Company, each substantially in the form set
forth in Exhibits A, B and C hereto with customary qualifications, assumptions
and exceptions reasonably satisfactory to you, (ii) the Company shall have
delivered or caused to be delivered written evidence that the Company Shares are
duly authorized for listing on the New York Stock Exchange, (iii) the Company
shall have delivered or caused to be delivered to you a certificate of the
Treasurer of the Company and the chief financial officer or chief accounting
officer of the Company, dated as of the Acceptance Date, to the effect that (w)
since the date of this Agreement, there has been no Material Adverse Change
(other than as set forth in the Prospectus), (x) the Company's representations
and warranties in this Agreement are true and correct with the same force and
effect as though expressly made at and as of the Acceptance Date, and (y) the
Company has complied with all agreements and taken all actions to be performed
or satisfied by the Company pursuant to this Agreement at or prior to the
Acceptance Date, and (z) the Registration Statement has been declared effective
by the Commission and no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose have
been instituted, are pending or, to
18
the best of such officer's knowledge, are threatened by the Commission, (iv) the
Company shall have delivered or caused to be delivered to you a certificate,
dated the Acceptance Date, of the Secretary of the Company in form and substance
reasonably satisfactory to you and (v) the Company shall have delivered or have
caused to be delivered to you a letter from Ernst & Young LLP, dated as of the
Acceptance Date, to the effect that Ernst & Young LLP reaffirms the statements
made in the letter furnished pursuant to subsection (a)(iv) of this Section 9,
except that the specified date referred to shall be a date not more than three
business days prior to the Acceptance Date.
10. Indemnification and Contribution. (a) The Company agrees to indemnify
and hold harmless each Dealer Manager and the affiliates and respective
directors, officers, employees, representatives, advisors and agents of each
Dealer Manager and each person who controls any of the Dealer Managers within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act (each of
the Dealer Managers and each such person being an "INDEMNIFIED PARTY") as
follows:
(i) from and against any and all losses, claims, damages,
liabilities and reasonable expenses whatsoever, joint or several, as
incurred, to which such Indemnified Party may become subject under any
applicable federal or state law, or otherwise, and related to, arising out
of, or based on (A) any untrue statement or alleged untrue statement of a
material fact contained in the Offer Material, as amended or supplemented,
or the omission or alleged omission therefrom of a material fact required
to be stated therein or necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading, (B)
any breach by the Company of any of its representations, warranties or
agreements contained herein, (C) the Company's failure to make or
consummate the Offer or the withdrawal, rescission, termination, amendment
or extension of the Offer or any other failure on the Company's part to
comply with the terms and conditions contained in the Offer Material, (D)
any of the transactions contemplated in the Offer Material or the
engagement of the Dealer Managers pursuant to, and the performance by the
Dealer Managers of the services contemplated by, this Agreement except in
the case of this clause (D) to the extent that any losses, claims,
damages, liabilities or expenses are found in a final judgment by a court
of competent jurisdiction to have resulted from the gross negligence, bad
faith or willful misconduct of an Indemnified Party, or (E) any action
taken or omitted to be taken by an Indemnified Party with the consent of
the Company or in conformity with the instructions or actions or omissions
of the Company;
(ii) from and against any and all losses, claims, damages,
liabilities and reasonable expenses whatsoever, as incurred, to the extent
19
of the aggregate amount paid in settlement of any litigation, or any
investigation or proceeding by any governmental agency or body, commenced
or threatened, or of any claim whatsoever related to, arising out of or
based on any matter described in subparagraph (i) above, provided that any
such settlement is effected with the written consent of the Company (which
consent shall not be unreasonably withheld); and
(iii) from and against any and all reasonable expenses
whatsoever, as incurred (including the fees and disbursements of counsel
chosen by you), reasonably incurred in investigating, preparing or
defending against any litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever related to, arising out of or based on any matter described in
(i) above, whether or not such Indemnified Party is a party and whether or
not such claim, action or proceeding is initiated or brought by or on
behalf of the Company, to the extent that any such expense is not paid
under subparagraph (i) or (ii) above;
provided, however, that the Company shall not be liable under clause (A)
of subparagraph (i) above to the extent that any losses, claims, damages,
liabilities or expenses arise out of any untrue statement or omission or
alleged untrue statement or omission made in the Offer Material in
reliance upon and in conformity with written information furnished to the
Company by the Dealer Managers expressly for use in the Offer Material, it
being understood and agreed that the only such information furnished by
any Dealer Manager consists of such Dealer Manager's legal and marketing
name.
(b) The Company agrees that no Indemnified Party shall have any liability
(whether direct or indirect, in contract or tort or otherwise) to the Company,
its security holders or creditors relating to or arising out of the engagement
of the Dealer Managers pursuant to, or the performance by the Dealer Managers of
the services contemplated by, this Agreement except to the extent that any loss,
claim, damage, liability or expense is found in a final judgment by a court of
competent jurisdiction to have resulted from the gross negligence, bad faith or
willful misconduct of the Dealer Managers.
(c) If the indemnification provided for in Section 10(a) hereof is for any
reason unavailable to or insufficient to hold harmless an Indemnified Party in
respect of any losses, liabilities, claims, damages or expenses referred to
therein (other than as a result of the proviso to Section 10(a) or, in the case
of clause (D) of Section 10(a)(i), as a result of the gross negligence, bad
faith or willful misconduct of an Indemnified Party), then the Company agrees to
contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by such Indemnified Party, as incurred, (i) in such
proportion as is appropriate to reflect the relative benefits to the Company on
the one hand and to the Dealer Managers on the other hand from the Offer
(whether or not consummated) or (ii) if, but only if, the allocation provided by
clause (i) is for any reason held unenforceable, in such proportion as is
20
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and of the
Dealer Managers on the other hand in connection with the statements or omissions
which resulted in such losses, liabilities, claims, damages or expenses, as well
as any other relevant equitable considerations. The relative benefits to the
Company on the one hand and the Dealer Managers on the other hand, in connection
with the Offer (whether or not consummated) shall be deemed to be in the same
proportion as the total value paid or proposed to be paid to holders of the
Securities pursuant to the Offer (whether or not consummated) bears to the fees
actually received by the Dealer Managers pursuant to Section 4 hereunder. The
relative fault of the Company on the one hand and the Dealer Managers on the
other hand shall be determined by reference to, among other things, whether any
such untrue or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact relates to information supplied by the
Company or by the Dealer Managers and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the Dealer Managers agree that it would not be just
and equitable if contribution pursuant to this Section 10(c) 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 10(c).
The aggregate amount of losses, liabilities, claims, damages and expenses
incurred by an Indemnified Party and referred to above in this Section 10(c)
shall be deemed to include any legal or other expenses reasonably incurred by
such Indemnified Party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission; provided,
however, that to the extent permitted by applicable law, in no event shall any
of the Dealer Managers be required to contribute any amount which, in the
aggregate, exceeds the aggregate fees received by such Dealer Manager under
Section 4 of this Agreement.
(d) In the event an Indemnified Party is requested or required to appear
as a witness in any action brought by or on behalf of or against the Company,
the Company agrees to reimburse such Indemnified Party for all reasonable
expenses as incurred by such Indemnified Party in connection with such
Indemnified Party's appearing and preparing to appear as such a witness,
including, without limitation, the reasonable fees and disbursements of its
legal counsel.
(e) Promptly after receipt by an Indemnified Party of written notice of
any claim or commencement of an action or proceeding with respect to which
21
indemnification or contribution may be sought hereunder, such Indemnified Party
shall notify the Company in writing of such claim or of the commencement of such
action, claim or proceeding, but failure so to notify the Company will not
relieve the Company from any liability which it may have hereunder to such
Indemnified Party except to the extent that the Company has been prejudiced in
any material respect by such failure, and in any event will not relieve the
Company from any other liability that it may have to such Indemnified Party. In
the event of any such claim, action or proceeding, if such Indemnified Party
shall notify the Company of the commencement thereof, the Company shall be
entitled to participate therein and, to the extent that it wishes, may assume
the defense thereof, with counsel reasonably satisfactory to such Indemnified
Party, and shall pay the reasonable fees and expenses of such counsel; provided,
however, (i) if the Company fails to assume such defense within fifteen business
days after receiving written notice of any such claim, action or proceeding or
(ii) if there exists or may exist a conflict of interest that would make it
inappropriate in the reasonable judgment of such Indemnified Party for the same
counsel to represent both the Indemnified Party and the Company, then such
Indemnified Party shall be entitled to retain its own counsel at the reasonable
expense of the Company provided, further, however, that the Company shall not be
required to pay the fees and expenses of more than one separate counsel (in
addition to any local counsel) for all Indemnified Parties in any jurisdiction
in respect of any single claim, action or proceeding. In respect of any claim,
action or proceeding the defense of which shall have been assumed by the Company
in accordance with the foregoing, each Indemnified Party shall have the right to
participate in such litigation and to retain its own counsel at its own expense.
(f) The Company agrees that, without your prior written consent, it will
not settle, compromise or consent to the entry of any judgment in or with
respect to any pending or threatened claim, action, investigation or proceeding
in respect of which indemnification or contribution could be sought under this
Section 10 (whether or not you or any other Indemnified Party is an actual or
potential party to such claim, action, investigation or proceeding), unless such
settlement, compromise or consent (i) includes an unconditional release of each
Indemnified Party from all liability arising out of such claim, action,
investigation or proceeding and (ii) does not include a statement as to, or an
admission of, fault, culpability or a failure to act by or on behalf of an
Indemnified Party. The Company shall not be liable for any settlement of any
proceeding effected without its written consent (which consent shall not be
unreasonably withheld), but if settled with such consent the Company agrees to
indemnify the Indemnified Party from and against any loss or liability by reason
of such settlement.
(g) If at any time an Indemnified Party shall have requested that the
Company reimburse the Indemnified Party for fees and expenses of counsel, the
Company agrees that it shall be liable for any settlement effected without its
written consent if (i) such settlement is entered into more than 45 days after
22
receipt by the Company of the aforesaid request, (ii) the Company shall have
received notice of the terms of such settlement at least 30 days prior to such
settlement being entered into and (iii) the Company shall not have reimbursed
such Indemnified Party in accordance with such request prior to the date of such
settlement.
(h) The rights of any Indemnified Party under this Agreement shall be in
addition to and not in limitation of any rights that any Indemnified Party may
have at common law or otherwise.
11. Survival of Indemnities, Representations, Warranties, Etc. The
indemnity and contribution agreements contained in Section 10, the provisions of
Sections 4 and 5 and the representations and warranties of the Company set forth
in this Agreement shall remain operative and in full force and effect,
regardless of (i) any failure to commence, or the withdrawal, termination or
consummation of, the Offer or the termination or assignment of this Agreement,
(ii) any investigation made by or on behalf of the Company or any Indemnified
Party and (iii) any withdrawal by you pursuant to Section 3.
12. Severability of Provisions. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law,
or public policy, all other provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the agreements contained herein is not affected in any manner adverse to any
party. Upon such determination that any term or provision is invalid, illegal or
unenforceable, the parties hereto shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible in a mutually acceptable manner in order that the agreements contained
herein may be performed as originally contemplated to the fullest extent
possible.
13. Counterparts. This Agreement may be executed and delivered (including
by facsimile transmission) in two or more separate counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.
14. Parties In Interest. This Agreement, including any right to indemnity
or contribution hereunder, shall inure to the benefit of and be binding upon the
Company, the Dealer Managers and the other Indemnified Parties (as defined in
Section 10) and their respective successors and assigns. Nothing in this
Agreement is intended, or shall be construed, to give to any other person or
entity any right hereunder or by virtue hereof.
15. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE
23
LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED IN AND PERFORMED
IN THAT STATE.
16. References to the Dealer Managers. The Company agrees that any
reference to any of the Dealer Managers in the Registration Statement,
Prospectus or Offer Material, or in any other release or communication relating
to the Offer, is subject to your prior approval, which approval shall not be
unreasonably withheld or delayed.
17. Notices. All notices and other communications required or permitted to
be given under this Agreement shall be in writing and shall be deemed given when
so delivered in person, by overnight courier, by facsimile transmission (with
receipt being confirmed by telephone or by automatic transmission report) or two
business days after being sent by registered or certified mail (postage prepaid,
return receipt requested), as follows:
(a) If to the Dealer Managers:
▇▇▇▇▇▇ Brothers Inc.
▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇, Managing Director / Global Natural
Resources Group
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.,
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
Four World ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇ / 4914
Attention: Liability Management,
▇▇▇▇▇ ▇▇▇▇▇ / ▇▇▇▇▇ ▇▇▇▇▇▇▇
with a copy to:
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
and
(b) If to the Company:
24
The ▇▇▇▇▇▇▇▇ Companies, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Treasurer
with a copy to:
▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
18. Securities Positions. The Company acknowledges that it has no
objection to the fact that, in the course of trading activities, the Dealer
Managers may from time to time have positions in, and, in accordance with
applicable law, buy or sell securities of, the Company and its affiliates.
19. Tombstone. You may place an announcement in such newspapers and
periodicals as you may choose, stating that the Dealer Managers are acting or
have acted as exclusive dealer managers to the Company in connection with the
Offer. Any such announcement shall be at your sole option and expense and
subject to the reasonable approval of the Company.
20. Waiver of Right to Trial by Jury and Applicable Law. The Dealer
Managers and the Company each waive any right to trial by jury in any action,
claim, suit or proceeding with respect to the engagement of the Dealer Managers
hereunder.
21. Miscellaneous. The descriptive headings contained in this Agreement
are incorporated for convenience of reference only and shall not affect in any
way the meaning or interpretation of this Agreement.
22. Entire Agreement; Amendment. This Agreement supersedes all prior
agreements and undertakings, both written and oral, of the parties hereto, or
any of them, with respect to the subject matter hereof and constitutes the
entire understanding of the parties hereto with respect to the subject matter
hereof. This Agreement may not be waived, amended or modified except in writing
signed by each party to be bound hereby.
[SIGNATURE PAGES FOLLOW]
25
Please indicate your willingness to act as a Dealer Manager on the terms
set forth herein and your acceptance of the foregoing provisions by signing in
the space provided below for that purpose and returning to us a copy of this
letter, whereupon this letter shall constitute a binding agreement among us.
Very truly yours,
THE ▇▇▇▇▇▇▇▇ COMPANIES, INC.
By:
-------------------------------
Name:
Title:
Accepted as of the date first above written:
▇▇▇▇▇▇ BROTHERS INC.
By:
-----------------------------------
Name:
Title:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.,
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
By:
-----------------------------------
Name:
Title:
Schedule I
COMPENSATION
(1) The compensation due to the Dealer Managers shall be equal to (i)
$0.25 for each $50 principal amount of the Securities validly tendered and
accepted by the Company pursuant to the Offer.
(2) The total compensation paid by the Company to the Dealer Managers
pursuant to (1) above shall be allocated among the Dealer Managers as follows:
▇▇▇▇▇▇ Brothers Inc. 60%
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ 40%
Incorporated
---
100%
S-I-1
Exhibit A
FORM OF OPINION OF ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ESQ.,
SENIOR VICE PRESIDENT AND GENERAL COUNSEL
OF THE COMPANY, TO BE DELIVERED PURSUANT TO SECTION 9
[To Be Dated the Commencement Date or Acceptance Date, as Applicable]
(i) The Company and each of its Significant Subsidiaries have been duly
incorporated or validly formed and are validly existing in good standing under
the laws of their respective jurisdictions of formation or incorporation, have
the requisite power and authority to own their property and to conduct their
business as described in the Prospectus and are duly qualified to do business
and are in good standing in each jurisdiction in which their respective
ownership or lease of property or the conduct of their respective businesses
requires such qualification, except to the extent such failure to be qualified
or in good standing would not reasonably be expected to have a Material Adverse
Effect, and all of the issued shares of capital stock of each Significant
Subsidiary that is a corporation have been duly and validly authorized and
issued and are fully paid, non-assessable and are owned directly or indirectly
by the Company, free and clear of all liens, encumbrances, equities or claims,
except for the shares of each of ▇▇▇▇▇▇▇▇ Production RMT Company, ▇▇▇▇▇▇▇
Resources International Corporation, Bargath Inc. and ▇▇▇▇▇▇▇ Fuels Corporation,
or such as are subject to liens under ▇▇▇▇▇▇▇▇' $1,275,000,000 Amended and
Restated Credit Agreement dated May 20, 2005, or such as are disclosed in the
Prospectus or to the extent any such liens encumbrances, equities or claims
would not have a Material Adverse Effect.
(ii) To such counsel's knowledge, the Company and its Significant
Subsidiaries each have all Licenses necessary to own, hold, or lease, as the
case may be, and to operate their respective properties and to carry on their
respective businesses as presently conducted, except where the failure to
possess such Licenses would not reasonably be expected to have a Material
Adverse Effect, and, to such counsel's knowledge, neither the Company nor any of
its Significant Subsidiaries has received any notice of proceedings relating to
revocation or modification of any such Licenses, except to the extent that any
such revocation or modification would not reasonably be expected to have a
Material Adverse Effect.
(iii) The Company is not in violation of its charter or bylaws, and, to
such counsel's knowledge, the Company is not (i) in default, and no event has
occurred which, with notice or lapse of time or both, would constitute such a
default, in the due performance or observance of any term, covenant or condition
contained in any Material Contract, or (ii) in violation of any law, ordinance,
governmental rule, regulation or court decree to which it or its property or
assets
A-1
may be subject, except as disclosed in the Prospectus, and in the case of (i)
and (ii), for such defaults or violations as are not reasonably expected to have
a Material Adverse Effect.
(iv) The Company Shares have been duly authorized for issuance and conform
to the description thereof contained in the Prospectus. When any Company Shares
are issued and delivered by the Company as provided in the Offer Material, such
Company Shares will be validly issued, fully paid and nonassessable, and the
stockholders of the Company have no preemptive rights with respect to the
Company Shares.
(v) To such counsel's knowledge, there are no contracts, agreements or
understandings between the Company and any person granting such person the right
to require the Company to file a registration statement under the 1933 Act with
respect to any securities of the Company owned or to be owned by such person or
to require the Company to include such securities in the securities registered
pursuant to the Registration Statement or in any securities being registered
pursuant to any other registration statement filed by the Company under the 1933
Act.
(vi) The (i) execution, delivery and performance by the Company of the
Dealer Manager Agreement, (ii) making and consummation of the Offer by the
Company (including but not limited to the issuance and delivery of Company
Shares thereunder), (iii) use of the Offer Material and the filing of the
Registration Statement, the Prospectus and the Schedule TO, and any amendments
or supplements thereto and (iv) consummation by the Company of the transactions
contemplated by the Dealer Manager Agreement, in each case, have been duly
authorized by all necessary corporate action on the part of the Company and do
not and will not contravene any law applicable to the Company, or any judgment,
order or decree of any governmental body, agency or court having jurisdiction
over the Company, except in each case where such contravention would not
reasonably be expected to have a Material Adverse Effect. This paragraph (vi)
does not include any opinion regarding any federal or state securities or "blue
sky" laws or regulations.
(vii) The Company has filed all documents with the Commission that it is
required to file, from and after January 1, 2005, under the 1934 Act.
(viii) To such counsel's knowledge, other than as set forth or
incorporated by reference in the Prospectus, there is no action, suit or
proceeding before or by any government, governmental instrumentality or court,
domestic or foreign, now pending or threatened against the Company or to which
any of its properties are subject that would reasonably be expected to result in
any Material Adverse Effect, or that would reasonably be expected to adversely
affect the
A-2
consummation of the transactions contemplated by the Offer or the other
transactions contemplated in the Dealer Manager Agreement.
(ix) To such counsel's knowledge, there are no legal or governmental
proceedings pending or threatened to which the Company or any of its
subsidiaries is subject which are required to be described and there are no
contracts or other documents which are required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to the
Registration Statement which are not described or filed as required.
(x) The Dealer Manager Agreement has been duly authorized, executed and
delivered by the Company.
Such counsel, or attorneys under such counsel's supervision, have
participated in conferences with officers and other representatives of the
Company, the Company's outside counsel, representatives of the independent
registered public accountants of the Company, and representatives and counsel of
the Dealer Managers at which the contents of the Registration Statement, the
Prospectus and the Schedule TO and related matters were discussed and, although
such counsel is not passing upon and does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement, the Prospectus or the Schedule TO (except as otherwise
indicated above), such counsel advises you that, on the basis of the foregoing,
no facts have come to such counsel's attention that have led such counsel to
believe that, solely with respect to the description of federal and state laws
and regulations, including regulations of the Federal Energy Regulatory
Commission, applicable to the Company and its subsidiaries operating in the
energy industry, and the effect of such laws and regulations on such business,
(a) the Registration Statement, as amended or supplemented, if applicable, at
the time it was filed with the Commission or as of the date hereof, contained or
contains an untrue statement of a material fact or omitted or omits to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading; (b) the Prospectus, as amended or supplemented, if
applicable, as of its date, 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 (c) the Schedule TO, as amended or supplemented,
if applicable, (including the information incorporated by reference therein) at
the time it was filed with the Commission or as of the date hereof, included or
includes an untrue statement of a material fact or omitted or omits to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
"INCORPORATED DOCUMENTS" means the Company's Annual Report on Form 10-K
for the year ended December 31, 2004 and all other reports filed by
A-3
the Company pursuant to Section 13(a) or 15(d) of the 1934 Act since the end of
the fiscal year covered by such Annual Report.
"MATERIAL CONTRACT" means all agreements and instruments included in the
list of exhibits in the Company's Annual Report on Form 10-K for the year ended
December 31, 2004, Quarterly Report on Form 10-Q for the quarter ended March 31,
2005, Quarterly Report on Form 10-Q for the quarter ended June 30, 2005,
Quarterly Report on Form 10-Q for the quarter ended September 30, 2005 and
Current Reports on Form 8-K filed subsequent to such Annual Report (except for
employment agreements, stock option plans, stock election plans, stock incentive
plans, officer and director indemnification agreements and deferred compensation
plans, all of which are excluded).
A-4
Exhibit B
FORM OF OPINION OF ▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP,
COUNSEL FOR THE COMPANY,
TO BE DELIVERED PURSUANT TO SECTION 9
[To Be Dated the Commencement Date or Acceptance Date, as Applicable]
(i) It is not necessary, in connection with the execution, delivery and
performance by the Company of the Dealer-Manager Agreement and the consummation
of the Offer for the Company to obtain the approval of, or to make any filing
with any governmental authority or regulatory body of the State of New York or
the United States of America under any law or regulation currently in effect of
the State of New York or the United States of America applicable to the Company
that, in such counsel's experience, is generally applicable to transactions in
the nature of those contemplated by the Dealer-Manager Agreement, except for
such filings or approvals as already have been made or obtained. This paragraph
(i) does not include any opinion regarding any federal or state securities or
"blue sky" laws or regulations.
(ii) The execution, delivery and performance by the Company of the
Dealer-Manager Agreement and the consummation of the Offer (i) do not and will
not violate the Certificate of Incorporation or By-laws of the Company;(ii) do
not and will not breach the terms of (a) any Material Contract, (b) any order,
judgment or decree of any court or other agency of government identified to such
counsel in an officers' certificate of the Company and attached to such opinion
and in either case, based solely on our review of such Material Contracts,
orders, judgments or decrees; and (iii) do not and will not violate any law or
regulation of the State of New York or the United States of America applicable
to the Company that, in such counsel's experience, is generally applicable to
transactions in the nature of those contemplated by the Dealer-Manager
Agreement. This paragraph (ii) does not include any opinion regarding any
federal or state securities or "blue sky" laws or regulations.
(iii) The Company is not and, after giving effect to the issuance of the
Company Shares, will not be required to register as an "investment company"
under the Investment Company Act of 1940, as amended.
"MATERIAL CONTRACT" means all agreements and instruments included in the
list of exhibits in the Company's Annual Report on Form 10-K for the year ended
December 31, 2004, Quarterly Report on Form 10-Q for the quarter ended March 31,
2005, Quarterly Report on Form 10-Q for the quarter ended June 30, 2005,
Quarterly Report on Form 10-Q for the quarter ended September 30, 2005 and
Current Reports on Form 8-K filed subsequent to such Annual Report (except for
employment agreements, stock option plans, stock election plans, stock
B-1
incentive plans, officer and director indemnification agreements and deferred
compensation plans, all of which are excluded).
B-2
Exhibit C
FORM OF LETTER OF ▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP,
COUNSEL TO THE COMPANY,
TO BE DELIVERED PURSUANT TO SECTION 9
[To Be Dated the Commencement Date or Acceptance Date, as Applicable]
Such counsel has participated in conferences with officers and other
representatives of the Company, representatives of the independent auditors of
the Company and the Dealer Managers' representatives and counsel at which the
contents of the Prospectus and related matters were discussed. Because the
purpose of such counsel's professional engagement was not to establish or
confirm factual matters and because such counsel did not independently undertake
to verify the accuracy, completeness or fairness of the statements set forth in
the Registration Statement, Prospectus or Schedule TO, such counsel are not
passing upon and do not assume any responsibility for the accuracy, completeness
or fairness of the statements contained in the Registration Statement,
Prospectus or Schedule TO except insofar as such statements specifically relate
to us and except to the extent set forth in the final two sentences of the
following paragraph.
On the basis of the foregoing, and except for the financial statements and
schedules, statistical information that is purported to have been provided on
the authority of an expert or public official and other information of an
accounting or financial nature included or incorporated by reference therein, as
to which such counsel expresses no opinion or belief, no facts have come to such
counsel's attention that led such counsel to believe: (a) that the Registration
Statement, at the time it was filed with the Commission or as of the date
hereof, or the Prospectus, as of its date or as of the date hereof, were not
appropriately responsive in all material respects to the requirements of the
Securities Act and the applicable rules and regulations of the Commission
thereunder; (b) that Schedule TO, as of its date or as of the date hereof, was
not appropriately responsive in all material respects to the requirements of the
Exchange Act and the applicable rules and regulations of the Commission
thereunder; or (c)(i) that the Registration Statement, at the time it was filed
with the Commission or as of the date hereof, 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, (ii) that the
Prospectus, as of its date or as of the date hereof, contained or contains 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
C-1
under which they were made, not misleading or (iii) that Schedule TO, as of its
date or as of the date hereof, contained or contains 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. Also on the basis of the foregoing, such counsel is
of the opinion that, insofar as the statements in the Prospectus under the
captions "Description of Debentures" and "Description of Capital Stock" purport
to summarize the documents referred to therein, such statements fairly present
in all material respects the information required to be disclosed under the
Securities Act and the rules and regulations of the Commission relating to
registration statements on Form S-4 and prospectuses. Further, such counsel is
of the opinion that the statements in the Prospectus under the caption "Material
United States Federal Income Tax Consequences," to the extent they constitute
descriptions of United States federal income tax laws, are accurate in all
material respects.
C-2