EXHIBIT 1.1
DRESSER-RAND GROUP INC.
[ ] Shares
Common Stock, par value $0.01 per Share
Underwriting Agreement
[ ], 2005
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
Citigroup Global Markets Inc.
UBS Securities LLC
Bear, ▇▇▇▇▇▇▇ & Co. Inc.
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇▇▇▇▇ Brothers Inc.
Natexis Bleichroeder Inc.
▇▇▇▇▇▇▇ & Company International
▇▇▇▇▇▇ ▇▇▇▇ Incorporated
c/o Morgan ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Dresser-Rand Group Inc., a corporation organized under the
laws of Delaware (the "COMPANY"), proposes to issue and sell to the several
Underwriters named in Schedule I hereto (the "UNDERWRITERS"), [ ] shares
of the common stock, par value $0.01 per share, of the Company (the "FIRM
SHARES").
The Company also proposes to issue and sell to the several
Underwriters not more than an additional [ ] shares of common stock, par
value $0.01 per share, of the Company (the "ADDITIONAL SHARES") if and to the
extent that ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated ("▇▇▇▇▇▇ ▇▇▇▇▇▇▇") and Citigroup
Global Markets Inc. ("CGMI", and together with ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, the "MANAGERS"),
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, par value $0.01 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"), then any reference herein to the term "Registration Statement"
shall be deemed to include such Rule 462 Registration Statement.
1. Representations and Warranties. The Company represents and
warrants to each Underwriter as set forth below in this Section 1:
(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) (i) 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 any material fact
required to be stated therein or necessary to make the statements therein not
misleading, (ii) 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 (iii) 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 any material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading; provided, however, that the Company makes no representation or
warranty as to the information contained in or omitted from the Registration
Statement or the Prospectus, or any amendment or supplement thereto, in reliance
upon and in conformity with information furnished in writing to the Company by
or on behalf of the Underwriters through the Managers specifically for inclusion
therein.
(c) 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, an "investment company" as defined in
the Investment Company Act, without taking account of any exemption arising out
of the number of holders of the Company's securities.
(d) The Company has not paid or agreed to pay to any person
any compensation for soliciting another to purchase any securities of the
Company (except as contemplated in this Agreement).
(e) Neither the Company nor any of its subsidiaries has taken
or will take, directly or indirectly, any action designed to or that has
constituted or that would reasonably be expected to cause or result, under the
Exchange Act or otherwise, in stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the Shares.
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(f) The Company and each of its "significant subsidiaries" (as
defined in Regulation S-X under the Securities Act) has been duly incorporated
or formed and is validly existing as an entity in good standing under the laws
of the jurisdiction in which it is chartered or organized with full corporate or
other organizational power and authority to own or lease, as the case may be,
and to operate its properties and conduct its business as described in the
Prospectus, and is duly qualified to do business as a foreign corporation or
other entity and is in good standing under the laws of each jurisdiction where
the ownership or leasing of its properties or the conduct of its business
requires such qualification except where the failure to be so incorporated or
formed or qualified, have such power or authority or be in good standing would
not reasonably be expected to have a material adverse effect on the condition
(financial or other), business, properties or results of operations of the
Company and its subsidiaries, taken as a whole (a "MATERIAL ADVERSE EFFECT").
The Company's "significant subsidiaries" are listed on Schedule II hereto.
(g) All the outstanding shares of capital stock of each
significant subsidiary of the Company have been duly authorized and validly
issued and are fully paid and nonassessable, and, except as otherwise set forth
in the Prospectus, all outstanding shares of capital stock of each significant
subsidiary of the Company are owned by the Company either directly or through
wholly owned subsidiaries free and clear of any security interest, claim, lien
or encumbrance (other than liens, encumbrances and restrictions imposed in favor
of the lenders under the Company's existing senior secured credit agreement
described in the Prospectus or permitted thereunder).
(h) (a) This Agreement has been duly authorized, executed and
delivered by the Company; (b) the shares of Common Stock outstanding prior to
the issuance of the Shares to be sold by the Company have been duly authorized
and are validly issued, fully paid and non-assessable; and (c) the Shares to be
sold by the Company 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.
(i) The authorized capital stock of the Company conforms as to
legal matters to the description thereof contained in the Prospectus.
(j) No consent, approval, authorization, filing with or order
of any court or governmental agency or body is required in connection with the
execution, delivery and performance of this Agreement (including without
limitation the issuance of the Shares), except such (i) as may be required under
the blue sky laws of any jurisdiction in which the Shares are offered and sold
or (ii) as shall have been obtained or made prior to the Closing Date.
(k) None of the execution and delivery of this Agreement, the
issuance and sale of the Shares or the consummation of any of the transactions
herein contemplated will conflict with or result in a breach or violation or
imposition of any lien, charge or encumbrance upon any property or assets of the
Company or any of its subsidiaries pursuant to (i) the charter or bylaws or
other organizational document of the Company or any of its significant
subsidiaries; (ii) the terms
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of any indenture, contract, lease, mortgage, deed of trust, note agreement, loan
agreement or other agreement, obligation, condition, covenant or instrument to
which the Company or any of its significant subsidiaries is a party or bound or
to which its or their property is subject; or (iii) any statute, law, rule,
regulation, judgment, order or decree of any court, regulatory body,
administrative agency, governmental body, arbitrator or other authority having
jurisdiction over the Company or any of its significant subsidiaries or any of
its or their properties other than in the case of clauses (ii) and (iii), such
breaches, violations, liens, charges or encumbrances that would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
(l) The consolidated historical financial statements of the
Company and the combined historical financial statements of Dresser-Rand Company
included in the Prospectus present fairly the financial condition, results of
operations and cash flows of the Company and Dresser-Rand Company as of the
dates and for the periods indicated, comply as to form with the applicable
accounting requirements of the Act and have been prepared in conformity with
generally accepted accounting principles in the United States applied on a
consistent basis throughout the periods involved (except as otherwise noted
therein); the selected financial data set forth under the captions "Summary
Historical and Pro Forma Financial Information" and "Selected Historical
Financial Information" in the Prospectus fairly present, on the basis stated in
the Prospectus, the information included therein; the pro forma financial
statements included in the Prospectus include assumptions that provide a
reasonable basis for presenting the significant effects directly attributable to
the offering of the Shares; the related pro forma adjustments give appropriate
effect to those assumptions; and the pro forma financial information reflect the
proper application of those adjustments to the historical financial statement
amounts in the pro forma financial statements included in the Prospectus. The
pro forma financial statements included in the Prospectus comply as to form in
all material respects with the applicable accounting requirements of Regulation
S-X under the Act. The selected historical combined financial data as of and for
the one month ended January 31, 2000 and the eleven months ended December 31,
2000 included in the Prospectus is correct and accurate in all material
respects.
(m) No action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the Company
or any of its subsidiaries or its or their property is pending or, to the best
knowledge of the Company, threatened that (i) would reasonably be expected to
have a Material Adverse Effect on the performance of this Agreement or the
consummation of any of the transactions contemplated hereby or (ii) would
reasonably be expected to have a Material Adverse Effect, except as set forth in
or contemplated in the Prospectus (exclusive of any amendment or supplement
thereto).
(n) Each of the Company and its subsidiaries owns or leases
all such properties as are necessary to the conduct of its operations as
presently conducted except as would not reasonably be expected to have a
Material Adverse Effect.
(o) Neither the Company nor any of its subsidiaries is in
violation or default of (i) any provision of its charter or bylaws or any
equivalent organizational document; (ii) the terms of any indenture, contract,
lease, mortgage, deed of trust, note agreement, loan agreement or other
agreement, obligation, condition, covenant or instrument to which it is a party
or bound or to
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which its property is subject; or (iii) any statute, law, rule, regulation,
judgment, order or decree applicable to the Company or any of its subsidiaries
of any court, regulatory body, administrative agency, governmental body,
arbitrator or other authority having jurisdiction over the Company or such
subsidiary or any of its properties, as applicable, other than in the cases of
clauses (ii) and (iii), such violations and defaults that would not reasonably
be expected to have a Material Adverse Effect.
(p) PricewaterhouseCoopers LLP, who have audited certain
financial statements of each of the Company and Dresser-Rand Company and
delivered their reports with respect to the audited consolidated financial
statements and audited combined financial statements included in the Prospectus,
is an independent registered public accounting firm with respect to the Company
and Dresser-Rand Company within the meaning of the Act.
(q) The Company has filed all non-U.S., U.S. federal, state
and local tax returns that are required to be filed or has requested extensions
thereof (except in any case in which the failure so to file would not reasonably
be expected to have a Material Adverse Effect and except as set forth in or
contemplated in the Prospectus (exclusive of any amendment or supplement
thereto)) and has paid all taxes required to be paid by it and any other
assessment, fine or penalty levied against it, to the extent that any of the
foregoing is due and payable, except for any such assessment, fine or penalty
that is currently being contested in good faith or as would not reasonably be
expected to have a Material Adverse Effect and except as set forth in or
contemplated in the Prospectus (exclusive of any amendment or supplement
thereto).
(r) No labor problem or dispute with the employees of the
Company or any of its subsidiaries exists or, to the Company's knowledge, is
threatened or imminent, and the Company is not aware of any existing or imminent
labor disturbance by its employees or any of its or its subsidiaries' employees,
except as would not reasonably be expected to have a Material Adverse Effect and
except as set forth in or contemplated in the Prospectus (exclusive of any
amendment or supplement thereto).
(s) The Company and each of its subsidiaries are insured
against such losses and risks and in such amounts as are prudent and customary
in the businesses in which they are engaged or as required by law, except as
would not reasonably be expected to have a Material Adverse Effect.
(t) No subsidiary of the Company is currently prohibited,
directly or indirectly, from paying any dividends to the Company or any other
subsidiary, from making any other distribution on such subsidiary's capital
stock, from repaying to the Company or any other subsidiary any loans or
advances to such subsidiary from the Company or any other subsidiary or from
transferring any of such subsidiary's property or assets to the Company or any
other subsidiary of the Company, except as described in or contemplated in the
Prospectus (exclusive of any amendment or supplement thereto) and except for any
prohibitions imposed under the Company's existing senior secured credit
agreement and the indenture governing the Company's outstanding 7 3/8% senior
subordinated notes due 2014.
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(u) The Company and its subsidiaries possess all licenses,
certificates, permits and other authorizations issued by the appropriate U.S.
federal, state or non-U.S. regulatory authorities necessary to conduct their
respective businesses, except where the failure to possess such licenses,
certificates, permits and other authorizations would not reasonably be expected
to have a Material Adverse Effect, 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 which, singly
or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would have a Material Adverse Effect, except as set forth in or
contemplated in the Prospectus (exclusive of any amendment or supplement
thereto).
(v) Except as described in the Prospectus (exclusive of any
amendment or supplement thereto), the Company and each of its subsidiaries
maintain a system of internal accounting controls sufficient to provide
reasonable assurance that (i) transactions are executed in accordance with
management's general or specific authorizations; (ii) transactions are recorded
as necessary to permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain asset accountability;
(iii) access to assets is permitted only in accordance with management's general
or specific authorization; and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.
(w) Except as set forth in or contemplated in the Prospectus
(exclusive of any amendment or supplement thereto), the Company and its
subsidiaries are (i) in compliance with any and all applicable non-U.S., U.S.
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"); (ii) have received
and are in compliance with all permits, licenses or other approvals required of
them under applicable Environmental Laws to conduct their respective businesses;
(iii) have not received notice of any actual or potential liability under any
Environmental Law; and (iv) have not been named as a "potentially responsible
party" under the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, as amended, except where such non-compliance with
Environmental Laws, failure to receive required permits, licenses or other
approvals, liability or naming as a "potentially responsible party" would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
(x) Each pension plan and welfare plan established or
maintained by the Company and/or one or more of its subsidiaries is in
compliance with the currently applicable provisions of ERISA and the Code,
except where noncompliance would not reasonably be expected to have a Material
Adverse Effect; and neither the Company nor any of its subsidiaries has incurred
or could reasonably be expected to incur any withdrawal liability under Section
4201 of ERISA, any liability under Section 4062, 4063 or 4064 of ERISA or any
other liability under Title IV of ERISA that would reasonably be expected to
have a Material Adverse Effect.
(y) No forward-looking statement (within the meaning of
Section 27A of the Act and Section 21E of the Exchange Act) or presentation of
market-related or statistical data
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contained in the Prospectus or Registration Statement has been made or
reaffirmed without a reasonable basis or has been disclosed in other than good
faith.
(z) No holders of the Company's Common Stock have rights to
include such Common Stock in the Registration Statement.
(aa) Except as described in the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of this Agreement), the
Company has not sold, issued or distributed any shares of Common Stock during
the six-month period preceding the date hereof, including any sales pursuant to
Rule 144A under, or Regulation D or S of, the Securities Act, other than shares
issued pursuant to employee benefit plans, qualified stock option plans or other
employee compensation plans or pursuant to outstanding options, rights or
warrants.
(bb) There is and has been no failure on the part of the
Company and any of the Company's directors or officers, in their capacities as
such, to comply with any provision of the Sarbanes Oxley Act of 2002 and the
rules and regulations promulgated in connection therewith (the "SARBANES OXLEY
ACT"), including Section 402 related to loans and Sections 302 and 906 related
to certifications, solely to the extent that the Sarbanes Oxley Act has been
applicable to the Company.
(cc) 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
which, individually or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would reasonably be expected to have a Material
Adverse Effect.
(dd) Neither the Company nor any of its subsidiaries nor, to
the knowledge of the Company, any director, officer, agent, employee or
affiliate of the Company or any of its subsidiaries is aware of or has taken any
action, directly or indirectly, that would result in a violation by such persons
of the FCPA, including, without limitation, making use of the mails or any means
or instrumentality of interstate commerce corruptly in furtherance of an offer,
payment, promise to pay or authorization of the payment of any money, or other
property, gift, promise to give, or authorization of the giving of anything of
value to any "foreign official" (as such term is defined in the FCPA) or any
foreign political party or official thereof or any candidate for foreign
political office, in contravention of the FCPA and the Company, its subsidiaries
and, to the knowledge of the Company, its affiliates have conducted their
businesses in compliance with the FCPA and have instituted and maintain policies
and procedures designed to ensure, and which are reasonably expected to continue
to ensure, continued compliance therewith. "FCPA" means Foreign Corrupt
Practices Act of 1977, as amended, and the rules and regulations thereunder.
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(ee) The operations of the Company and its subsidiaries are
and have been conducted at all times in compliance with applicable financial
recordkeeping and reporting requirements of the Currency and Foreign
Transactions Reporting Act of 1970, as amended, the money laundering statutes of
all jurisdictions, the rules and regulations thereunder and any related or
similar rules, regulations or guidelines, issued, administered or enforced by
any governmental agency (collectively, the "MONEY LAUNDERING LAWS") and no
action, suit or proceeding by or before any court or governmental agency,
authority or body or any arbitrator involving the Company or any of its
subsidiaries with respect to the Money Laundering Laws is pending or, to the
best knowledge of the Company, threatened, except, in each case, as would not
reasonably be expected to have a Material Adverse Effect.
(ff) Except as specifically described in the Prospectus
(exclusive of any amendment or supplement thereto), neither the Company nor any
of its subsidiaries nor, to the knowledge of the Company, any director, officer,
agent, employee or affiliate of the Company or any of its subsidiaries is
currently subject to any U.S. sanctions administered by the Office of Foreign
Assets Control of the U.S. Treasury Department ("OFAC"); and the Company will
not directly or indirectly use the proceeds of the offering, or lend, contribute
or otherwise make available such proceeds to any subsidiary, joint venture
partner or other person or entity, for the purpose of financing the activities
of any person currently subject to any U.S. sanctions administered by OFAC.
Any certificate signed by any officer of the Company and
delivered to the Underwriters or counsel for the Underwriters in connection with
the offering of the Shares shall be deemed a representation and warranty by the
Company, as to matters covered thereby, to each Underwriter.
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 at $[ ] a share (the "PURCHASE PRICE") the respective numbers of Firm
Shares set forth in Schedule I hereto opposite its name.
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 the right to purchase, severally and not jointly, up to [ ] Additional
Shares at the Purchase Price. You may exercise this right on behalf of the
Underwriters in whole or from time to time in part by giving written notice of
each election to exercise the option not later than 30 days after the date of
this Agreement. Any exercise 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. Each purchase date must be at least one business day after the
written notice is given and may not be earlier than the closing date for the
Firm Shares nor later than ten business days after the date of such notice.
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. On each day, if any, that Additional Shares are to be purchased
(an "OPTION CLOSING DATE"), each Underwriter agrees, severally and not jointly,
to
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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 on such Option Closing
Date 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 the Managers 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 or (iii) file any registration statement with
the Securities and Exchange Commission relating to the offering of any shares of
Common Stock or any securities convertible into or exercisable or exchangeable
for Common Stock.
The restrictions contained in the preceding paragraph 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 of which the
Underwriters have been advised in writing, (C) grants, issuances or exercises
under any existing employee benefits plans or (D) the issuance of Common Stock
in connection with the acquisition of, or joint venture with, another company ;
provided that in the case of any transfer, distribution or issuance pursuant to
clause (D), (i) each distributee or recipient shall sign and deliver a lock-up
letter substantially in the form of Exhibit A hereto and (ii) the undersigned
and the recipient shall not be required to, and shall not voluntarily, file a
report under the Exchange Act, reporting a reduction in beneficial ownership of
shares of Common Stock during the restricted period referred to in the preceding
paragraph.
The Company also agrees and consents to the entry of stop
transfer instructions with the Company's transfer agent and registrar against
the transfer of shares of Common Stock except in compliance with the foregoing
restrictions.
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 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 in New York
City against delivery of
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such Firm Shares for the respective accounts of the several Underwriters at
10:00 a.m., New York City time, on [ ], 2005, or at such other time or such
other date, not later than [5 business days after first date], 2005, 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
corresponding notice described in Section 2 or at such other time on the same or
on such other date, in any event not later than [10 business days after
expiration of shoe], 2005, as shall be designated in writing by you. The time
and date of such payment are hereinafter referred to as the "OPTION CLOSING
DATE."
The Firm Shares and Additional Shares shall be 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 applicable Option
Closing Date, as the case may be. The Firm Shares and Additional Shares shall be
delivered to you on the Closing Date or an 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 transfer of the Shares to the Underwriters
duly paid, against payment of the Purchase Price therefor.
5. Agreements. The Company agrees with each Underwriter that:
(a) The Company will furnish to each Underwriter and to
counsel for the Underwriters, without charge, signed copies of the Registration
Statement (including exhibits thereto) and will furnish to the Underwriters
during the period referred to in paragraph (c) below, as many copies of the
Prospectus and any amendments and supplements thereto as they may reasonably
request no later than 5:00 p.m., New York City time, on the day immediately
following the date hereof.
(b) The Company will not make any amendment or supplement to
the Prospectus without the prior written consent of the Managers (not to be
unreasonably withheld or delayed).
(c) If at any time when a prospectus relating to the shares is
required to be delivered under the Act, any event occurs as a result of which,
in the opinion of counsel for the Underwriters and counsel for the Company, it
is necessary to amend or supplement the Prospectus, as then amended or
supplemented, (i) in order that the Prospectus would not include any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading, or (ii) comply with applicable law, the Company will
promptly (A) notify the Underwriters of any such event; (B) subject to the
requirements of paragraph (b) of this Section 5, prepare an amendment or
supplement that will correct such statement or omission or effect such
compliance; and (C) supply any supplemented or amended Prospectus to the several
Underwriters and counsel for the Underwriters without charge in such quantities
as they may reasonably request.
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(d) The Company will arrange, if necessary, for the
qualification of the Shares for sale by the Underwriters under the laws of such
jurisdictions as the Underwriters may designate and will maintain such
qualifications in effect so long as required for the sale of the Shares;
provided that in no event shall the Company be obligated to qualify to do
business in any jurisdiction where it is not now so qualified or to take any
action that would subject it to service of process in suits, other than those
arising out of the offering or sale of the Shares, in any jurisdiction where it
is not now so subject or to subject itself to taxation in excess of a nominal
amount in respect of doing business in any jurisdiction. The Company will
promptly advise the Underwriters of the receipt by the Company of any
notification with respect to the suspension of the qualification of the Shares
for sale in any jurisdiction or the initiation or threatening of any proceeding
for such purpose.
(e) The Company will not take, directly or indirectly, any
action designed to or which has constituted or which might reasonably be
expected to cause or result, under the Exchange Act or otherwise, in
stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Shares.
(f) The Company agrees to pay the costs and expenses relating
to the following matters: (i) the preparation, printing (or reproduction),
delivery (including postage, air freight charges and charges for counting and
packaging) and filing of copies of the preliminary Prospectus, Prospectus and
the Registration Statement, and all amendments or supplements to any of the
foregoing, as may, in each case, be reasonably requested for use in connection
with the offering and sale of the Shares; (ii) any stamp or transfer taxes in
connection with the original issuance, sale and delivery of the Shares; (iii)
the printing (or reproduction) and delivery of this Agreement and any blue sky
memorandum delivered to investors in connection with the offering of the Shares;
(iv) any registration or qualification of the Shares for offer and sale under
the securities or blue sky laws of the several states and any other
jurisdictions specified pursuant to Section 5(d) (including filing fees and the
reasonable fees and expenses of counsel for the Underwriters relating to such
registration and qualification); (v) 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.; (vi) 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 NYSE, (vii) the cost of printing certificates representing the
Shares; (viii) the costs and charges of any transfer agent, registrar or
depositary; (ix) the transportation and other expenses (collectively, the "ROAD
SHOW EXPENSES") incurred by or on behalf of the representatives of the Company
in connection with presentations to prospective purchasers of the Shares; (x)
the fees and expenses of the Company's accountants and the fees and expenses of
counsel (including local and special counsel) for the Company; and (xi) all
other costs and expenses incident to the performance by the Company of their
obligations hereunder; provided, however, that the Underwriters will pay
one-half of the cost of any chartered aircraft used in connection with
presentations to prospective purchasers of the Shares.
(g) The Company will use its best efforts to cause the
Registration Statement, if not effective at the Execution Time, and any
amendment thereof, to become effective. Prior to the
-11-
termination of the offering of the Shares, the Company will not file any
amendment of the Registration Statement or supplement to the Prospectus or any
Rule 462(b) Registration Statement unless the Company has furnished you a copy
for your review prior to filing and will not file any such proposed amendment or
supplement to which you reasonably object. Subject to the foregoing sentence, if
the Registration Statement has become or becomes effective pursuant to Rule
430A, or filing of the Prospectus is otherwise required under Rule 424(b), the
Company will cause the Prospectus, properly completed, and any supplement
thereto to be filed in a form approved by the Managers with the Commission
pursuant to the applicable paragraph of Rule 424(b) within the time period
prescribed and will provide evidence satisfactory to the Managers of such timely
filing. The Company will promptly advise the Managers (1) when the Registration
Statement, if not effective at the Execution Time, shall have become effective,
(2) when the Prospectus, and any supplement thereto, shall have been filed (if
required) with the Commission pursuant to Rule 424(b) or when any Rule 462(b)
Registration Statement shall have been filed with the Commission, (3) when,
prior to termination of the offering of the Shares, any amendment to the
Registration Statement shall have been filed or become effective, (4) of any
request by the Commission or its staff for any amendment of the Registration
Statement, or any Rule 462(b) Registration Statement, or for any supplement to
the Prospectus or for any additional information, (5) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or the institution or threatening of any proceeding for that purpose
and (6) of the receipt by the Company of any notification with respect to the
suspension of the qualification of the Shares for sale in any jurisdiction or
the institution or threatening of any proceeding for such purpose. The Company
will use its best efforts to prevent the issuance of any such stop order or the
suspension of any such qualification and, if issued, to obtain as soon as
possible the withdrawal thereof.
(h) The Company will comply with all applicable securities and
other applicable laws, rules and regulations, including, without limitation, the
Sarbanes Oxley Act, and to use its best efforts to cause the Company's directors
and officers, in their capacities as such, to comply with such laws, rules and
regulations, including, without limitation, the provisions of the Sarbanes Oxley
Act.
(i) As soon as practicable, the Company will make generally
available to its security holders and to the Managers an earnings statement or
statements of the Company and its subsidiaries which will satisfy the provisions
of Section 11(a) of the Act and Rule 158 under the Act.
(j) The Company will use the net proceeds received by it from
the sale of the Shares in the manner specified in the Prospectus under "Use of
Proceeds."
6. Conditions to the Obligations of the Underwriters. 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 shall
be subject to the accuracy in all material respects of the representations and
warranties of the Company contained herein that are not qualified by materiality
and to the accuracy of the representations and warranties of the Company
contained herein that are qualified by materiality at the date hereof, the
Closing Date, and any Option
-12-
Closing Date, if applicable, to the accuracy of the statements of the Company
made in any certificates pursuant to the provisions hereof, to the performance
by the Company of their respective obligations hereunder and to the following
additional conditions:
(a) The Company shall have requested and caused (i) ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, counsel for the Company, to furnish to the Underwriters
their opinion and negative assurance statement, each dated the Closing Date and,
if applicable, any Option Closing Date, and addressed to the Underwriters and
substantially in the form of Exhibits B and C hereto; (ii) ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇,
General Counsel of the Company, to furnish to the Underwriters his opinion dated
the Closing Date and, if applicable, any Option Closing Date, addressed to the
Underwriters and substantially in the form of Exhibit D hereto; and (iii)
Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, special environmental counsel for the
Company, to furnish to the Underwriters their negative assurance letter as to
certain specified environmental disclosure dated the Closing Date and, if
applicable, any Option Closing Date, and addressed to the Underwriters and
substantially in the form of Exhibit E hereto.
(b) The Underwriters shall have received from Shearman &
Sterling LLP, counsel for the Underwriters, such opinion or opinions, dated the
Closing Date and, if applicable, any Option Closing Date, and addressed to the
Underwriters, with respect to the issuance and sale of the Shares, the
Prospectus and Registration Statement and other related matters as the
Underwriters may reasonably require, and the Company shall have furnished to
such counsel such documents as they request for the purpose of enabling them to
pass upon such matters.
(c) The Company shall have furnished to the Underwriters a
certificate of the Company, signed by (x) the Chairman of the Board or the
President and (y) the principal financial or accounting officer of the Company,
dated the Closing Date and, if applicable, any Option Closing Date, to the
effect that the signers of such certificate have carefully examined the
Prospectus and Registration Statement, any amendment or supplement to the
Prospectus and Registration Statement and this Agreement and that:
(i) the representations and warranties of the Company
in this Agreement that are not qualified by materiality are
true and correct in all material respects, and the
representations and warranties of the Company in this
agreement that are qualified by materiality are true and
correct, in each case, on and as of the Closing Date or any
Option Closing Date, as the case may be, with the same effect
as if made on the Closing Date, or such Option Closing Date,
as the case may be, and the Company has complied with all the
agreements and satisfied all the conditions on its part to be
performed or satisfied hereunder at or prior to the Closing
Date, or any Option Closing Date, as the case may be; and
(ii) since the date of the most recent financial
statements included in the Prospectus and the Registration
Statement (exclusive of any amendment or supplement thereto),
there has been no material adverse change in the condition,
financial or otherwise, or in the earnings, business,
properties or results of operations of the Company and its
subsidiaries, taken as a whole, from that set
-13-
forth in the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement).
(d) At the date hereof and at the Closing Date, the Company
shall have requested and caused PricewaterhouseCoopers LLP to furnish to the
Underwriters a "comfort" letter, dated as of the date hereof, and a bring-down
"comfort" letter (i) on and dated as of the Closing Date and (ii) if applicable,
on and dated as of any Option Closing Date, each in form and substance
satisfactory to the Managers, confirming that it is an independent registered
public accounting firm within the meaning of the Exchange Act and the applicable
published rules and regulations thereunder and confirming certain matters with
respect to the audited and unaudited financial statements and other financial
and accounting information contained in the Prospectus and Registration
Statement; provided that the letter delivered on the Closing Date shall use a
"cut-off" date no more than three days prior to the date of such letter.
All references in this Section 6(d) to the Prospectus and
Registration Statement include any amendment or supplement thereto at
the date of the applicable letter.
(e) The "lock-up" agreements, each substantially in the form
of Exhibit A hereto, between you and D-R Interholding, LLC, each executive
officer and director of the Company and certain affiliates of First Reserve
Corporation, listed on Schedule III hereto, 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.
(f) Subsequent to the execution and delivery of this Agreement
and prior to the Closing Date or, if applicable, any Option 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,
properties or results of 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.
(g) Prior to the Closing Date, or, if applicable, any Option
Closing Date, the Company shall have furnished to the Underwriters such further
information, certificates and documents as the Underwriters may reasonably
request.
-14-
(h) The Shares shall have been listed, subject to notice of
issuance, on the New York Stock Exchange, and satisfactory evidence of such
actions shall have been provided to the Managers.
(i) On the Closing Date, and, if applicable, any Option
Closing Date, the Registration Statement shall be effective; no stop order
suspending the effectiveness of the Registration Statement shall be in effect,
and no proceedings for such purpose shall be pending before or threatened by the
Commission.
If any of the conditions specified in this Section 6 shall not
have been fulfilled when and as provided in this Agreement, or if any of the
opinions, letters, evidence and certificates mentioned above in this Section 6
shall not be reasonably satisfactory in form and substance to the Managers and
counsel for the Underwriters, this Agreement and all obligations of the
Underwriters hereunder may be cancelled at, or at any time prior to, the Closing
Date or, if applicable, any Option Closing Date by the Underwriters. Notice of
such cancellation shall be given to the Company in writing or by telephone or
facsimile confirmed in writing.
The documents required to be delivered by this Section 6 will
be delivered at the office of counsel for the Underwriters, at ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, on the Closing Date.
7. Reimbursement of Expenses. If the sale of the Shares
provided for herein is not consummated because any condition to the obligations
of the Underwriters set forth in Section 6 hereof is not satisfied, because of
any termination pursuant to Section 10 hereof or because of any refusal,
inability or failure on the part of any Company to perform any agreement herein
or comply with any provision hereof other than by reason of a default by any of
the Underwriters, including any default pursuant to Section 9 hereof, the
Company will reimburse the Underwriters severally through the Managers on demand
for all reasonable expenses (including reasonable fees and disbursements of
counsel) that shall have been incurred by them in connection with the proposed
purchase and sale of the Shares.
8. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter, the directors, officers and
Affiliates of each Underwriter and each person who controls any Underwriter
within the meaning of either the Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several, to which they or any
of them may become subject under the Act, the Exchange Act or other U.S. federal
or state statutory law or regulation, at common law or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement, any preliminary
prospectus or the Prospectus, or in any amendment or supplement thereto or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, and (subject to the limitations set forth in the proviso to this
sentence) agree to reimburse each such indemnified party, as incurred, for any
legal or other expenses reasonably incurred by it in connection with
investigating or defending any such loss,
-15-
claim, damage, liability or action; provided, however, 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 in the Registration
Statement, any preliminary prospectus or the Prospectus, or in any amendment or
supplement thereto, in reliance upon and in conformity with written information
furnished to the Company by or on behalf of any Underwriter through the Managers
specifically for inclusion therein; provided further that with respect to any
untrue statement or omission of material fact made in the any preliminary
prospectus, the indemnity agreement contained in this Section 8(a) shall not
inure to the benefit of any Underwriter from whom such person asserting such
loss, claim, damage or liability purchased the Shares concerned, to the extent
that any such loss, claim, damage or liability of such Underwriter occurs under
the circumstance where (i) the Company had previously furnished copies of the
Prospectus on a timely basis to the Managers, (ii) the untrue statement or
omission of a material fact contained in any preliminary prospectus was
corrected in the Prospectus and (iii) there was not sent or given to such
person, at or prior to the written confirmation of the sale of such Shares to
such person, a copy of the Prospectus. This indemnity agreement will be in
addition to any liability that the Company may otherwise have. The Company shall
not be liable under this Section 8 to any indemnified party regarding any
settlement or compromise or consent to the entry of any judgment with respect to
any pending or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such claim or action)
unless such settlement, compromise or consent is consented to by the Company,
which consent shall not be unreasonably withheld.
(b) Each Underwriter severally, and not jointly, agrees to
indemnify and hold harmless the Company, its directors, officers and Affiliates,
and each person who controls the Company within the meaning of either the Act or
the Exchange Act, to the same extent as the foregoing indemnity from the Company
to each Underwriter, but only with reference to written information relating to
such Underwriter furnished to the Company by or on behalf of such Underwriter
through the Managers specifically for inclusion in the Registration Statement,
any preliminary prospectus or the Prospectus (or in any amendment or supplement
thereto). This indemnity agreement will be in addition to any liability that any
Underwriter may otherwise have. The Company acknowledges that, under the heading
"Underwriting," the table after the first paragraph, the third paragraph, the
seventh paragraph and the twelfth paragraph in any preliminary prospectus and
the Prospectus constitute the only information furnished in writing by or on
behalf of the Underwriters for inclusion in the Registration Statement, any
preliminary prospectus or the Prospectus or in any amendment or supplement
thereto.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 8, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying party (i)
will not relieve it from liability under paragraph (a) or (b) above unless and
to the extent it did not otherwise learn of such action and such failure results
in the forfeiture by the indemnifying party of substantial rights and defenses
and (ii) will not, in any event, relieve the indemnifying party from any
obligations to any indemnified party other than the indemnification obligation
-16-
provided in paragraph (a) or (b) above. The indemnifying party shall be entitled
to appoint counsel (including local counsel) of the indemnifying party's choice
at the indemnifying party's expense to represent the indemnified party in any
action for which indemnification is sought (in which case the indemnifying party
shall not thereafter be responsible for the fees and expenses of any separate
counsel, other than local counsel if not appointed by the indemnifying party,
retained by the indemnified party or parties except as set forth below);
provided, however, that such counsel shall be reasonably satisfactory to the
indemnified party. Notwithstanding the indemnifying party's election to appoint
counsel (including local counsel) to represent the indemnified party in an
action, the indemnified party shall have the right to employ separate counsel
(including local counsel), and the indemnifying party shall bear the reasonable
fees, costs and expenses of such separate counsel if (i) the use of counsel
chosen by the indemnifying party to represent the indemnified party would
present such counsel with a conflict of interest (based on the advise of counsel
to the indemnified person); (ii) such action includes both the indemnified party
and the indemnifying party and the indemnified party shall have reasonably
concluded (based on the advise of counsel to the indemnified person) that there
may be legal defenses available to it and/or other indemnified parties that are
different from or additional to those available to the indemnifying party; (iii)
the indemnifying party shall not have employed counsel reasonably satisfactory
to the indemnified party to represent the indemnified party within a reasonable
time after notice of the institution of such action; or (iv) the indemnifying
party shall authorize the indemnified party to employ separate counsel at the
expense of the indemnifying party. It is understood and agreed that the
indemnifying party shall not, in connection with any proceeding or related
proceeding in the same jurisdiction, be liable for the reasonable fees and
expenses of more than one separate firm (in addition to any local counsel) for
all indemnified parties. Any such separate firm for any Underwriter, its
directors, officers and Affiliates and any control person shall be designated in
writing by the Managers and any such separate firm for any of the Company, its
directors, officers and Affiliates and any control person shall be designated in
writing by the Company. An indemnifying party will not, without the prior
written consent of the indemnified parties, settle or compromise or consent to
the entry of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified parties are actual or
potential parties to such claim or action) unless such settlement, compromise or
consent includes an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding and does not
include any statement as to, or any admission of, fault, culpability or failure
to act by or on behalf of any indemnified party.
(d) In the event that the indemnity provided in paragraph (a)
or (b) of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company and the Underwriters severally
agree to contribute to the aggregate losses, claims, damages and liabilities
(including legal or other expenses reasonably incurred in connection with
investigating or defending any loss, claim, damage, liability or action)
(collectively, "LOSSES") to which the Company and one or more of the
Underwriters may be subject in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and by the
Underwriters on the other from the offering of the Shares; provided, however,
that in no case shall any Underwriter be responsible for any amount in excess of
the purchase discount or commission
-17-
applicable to the Shares purchased by such Underwriter hereunder. If the
allocation provided by the immediately preceding sentence is unavailable for any
reason, the Company and the Underwriters severally shall contribute in such
proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of the Company on the one hand and the Underwriters on the
other in connection with the statements or omissions that resulted in such
Losses, as well as any other relevant equitable considerations. Benefits
received by the Company shall be deemed to be equal to the total net proceeds
from the offering (before deducting expenses) received by them, and benefits
received by the Underwriters shall be deemed to be equal to the total purchase
discounts and commissions. Relative fault shall be determined by reference to,
among other things, whether any untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information provided by the Company on the one hand or the Underwriters on the
other, the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such untrue statement or
omission and any other equitable considerations appropriate in the circumstance.
The Company and the Underwriters agree that it would not be just and equitable
if the amount of such contribution were determined by pro rata allocation or any
other method of allocation that does not take account of the equitable
considerations referred to above. Notwithstanding the provisions of this
paragraph (d), no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations to contribute pursuant to this Section 8 are several
in proportion to their respective obligations and not joint. For purposes of
this Section 8, each person who controls an Underwriter within the meaning of
either the Act or the Exchange Act and each director, officer, employee,
Affiliate and agent of an Underwriter shall have the same rights to contribution
as such Underwriter, and each person who controls the Company within the meaning
of either the Act or the Exchange Act and each officer and director of the
Company shall have the same rights to contribution as the Company, subject in
each case to the applicable terms and conditions of this paragraph (d).
9. Default by an Underwriter. If any one or more Underwriters
shall fail to purchase and pay for any of the Shares agreed to be purchased by
such Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the principal amount of Shares
set forth opposite their names in Schedule I hereto bears to the aggregate
principal amount of Shares set forth opposite the names of all the remaining
Underwriters) the Shares which the defaulting Underwriter or Underwriters agreed
but failed to purchase; provided, however, that in the event that the aggregate
principal amount of Shares which the defaulting Underwriter or Underwriters
agreed but failed to purchase shall exceed 10% of the aggregate principal amount
of Shares set forth in Schedule I hereto, the Company shall be entitled to a
further period of 36 hours within which to procure another party or parties
reasonably satisfactory to the nondefaulting Underwriter or Underwriters to
purchase no less than the amount of such unpurchased Shares that exceeds 10% of
the principal amount thereof upon such terms herein set forth. If, however, the
Company shall not have completed such arrangements within 72 hours after such
default and the principal amount of such unpurchased Shares exceeds 10% of the
principal amount of such Shares
-18-
to be purchased on such date, then this Agreement will terminate without
liability to any nondefaulting Underwriter or the Company. In the event of a
default by any Underwriter as set forth in this Section 10, the Closing Date
shall be postponed for such period, not exceeding five Business Days, as the
Underwriters, the Company and its counsel shall determine in order that the
required changes in the Prospectus or in any other documents or arrangements may
be effected. Nothing contained in this Agreement shall relieve any defaulting
Underwriter of its liability, if any, to the Company or any nondefaulting
Underwriter for damages occasioned by its default hereunder.
10. Termination. This Agreement shall be subject to
termination in the absolute discretion and in the sole judgment of the Managers,
by notice given to the Company prior to delivery of and payment for the Shares,
if at any time prior to such time (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 or the Nasdaq National Market, (ii) trading of any
securities of the Company shall have been suspended on any exchange or in any
over-the-counter market, (iii) a material disruption in securities settlement,
payment or clearance services in the United States shall have occurred, (iv) any
moratorium on commercial banking activities shall have been declared by Federal
or New York State authorities or (v) there shall have occurred any outbreak or
escalation of hostilities, or any change in financial markets or any calamity or
crisis that, in your sole judgment, is material and adverse and which, singly or
together with any other event specified in this clause (v), makes it, in your
sole judgment, impracticable or inadvisable to proceed with the offer, sale or
delivery of the Shares on the terms and in the manner contemplated in the
Prospectus (exclusive of any amendment or supplement thereto).
11. No Fiduciary Duty. The Company acknowledges that in
connection with the offering of the Shares and the discussions and negotiations
relating to the price per share set forth in this Agreement: (a) the
Underwriters have acted at arm's length from, are not agents of or advisors to,
and owe no fiduciary duties to, the Company or any other person, (b) the
Underwriters owe the Company only those contractual duties and obligations set
forth in this Agreement and (c) the Underwriters may have interests that differ
from those of the Company. The Company agrees that it will not claim that the
Underwriters, or any of them, has rendered advisory services of any nature or
respect, or owed or owes a fiduciary or similar duty to the Company, in
connection with such transaction or the process leading thereto.
12. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers and of the Underwriters set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of the Underwriters or the Company or any of
the indemnified persons referred to in Section 8 hereof, and will survive
delivery of and payment for the Shares. The provisions of Sections 7 and 8
hereof shall survive the termination or cancellation of this Agreement.
13. Notices. All communications hereunder will be in writing
and effective only on receipt, and, if sent to the Underwriters, will be mailed,
delivered or telefaxed to the ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Equity Capital Markets Syndicate
Desk (fax no.: (▇▇▇) ▇▇▇-▇▇▇▇) and confirmed
-19-
to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ at ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, attention of
General Counsel; or, if sent to the Company, will be mailed, delivered or
telefaxed to (▇▇▇) ▇▇▇-▇▇▇▇ and confirmed to it at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, attention of General Counsel.
14. Successors. This Agreement will inure to the benefit of
and be binding upon the parties hereto and their respective successors and the
indemnified persons referred to in Section 8 hereof and their respective
successors, and no other person will have any right or obligation hereunder. No
purchaser of Shares from any Underwriters shall be deemed to be a successor
merely by reason of such purchase.
15. Applicable Law. This Agreement will be governed by and
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of New York. The parties
hereto each hereby waive any right to trial by jury in any action, proceeding or
counterclaim arising out of or relating to this Agreement.
16. Counterparts. This Agreement may be signed in one or more
counterparts (which may be delivered in original form or telecopier), each of
which when so executed shall constitute an original and all of which together
shall constitute one and the same agreement.
17. Headings. The section headings used herein are for
convenience only and shall not affect the construction hereof.
18. Definitions. The terms that follow, when used in this
Agreement, shall have the meanings indicated.
"ACT" shall mean the Securities Act of 1933, as amended, and
the rules and regulations of the Commission promulgated thereunder.
"AFFILIATE" shall have the meaning specified in Rule 501(b) of
Regulation D.
"BUSINESS DAY" shall mean any day other than a Saturday, a
Sunday or a legal holiday or a day on which banking institutions or trust
companies are authorized or obligated by law to close in The City of New York.
"CODE" shall mean the Internal Revenue Code of 1986, as
amended.
"COMMISSION" shall mean the Securities and Exchange
Commission.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission promulgated
thereunder.
"EXECUTION TIME" shall mean the date and time that this
Agreement is executed and delivered by the parties hereto.
"INVESTMENT COMPANY ACT" shall mean the Investment Company Act
of 1940, as amended, and the rules and regulations of the Commission promulgated
thereunder.
-20-
"NASD" shall mean the National Association of Securities
Dealers, Inc.
"REGULATION D" shall mean Regulation D under the Act.
-21-
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
among the Company and the several Underwriters.
Very truly yours,
DRESSER-RAND GROUP INC.
By: _________________________________
Name:
Title:
-22-
The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
Citigroup Global Markets Inc.
UBS Securities LLC
Bear, ▇▇▇▇▇▇▇ & Co. Inc.
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇▇▇▇▇ Brothers Inc.
Natexis Bleichroeder Inc.
▇▇▇▇▇▇▇ & Company International
▇▇▇▇▇▇ ▇▇▇▇ Incorporated
By: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
By:
---------------------------------------
Name:
Title:
By: Citigroup Global Markets Inc.
By:
---------------------------------------
Name:
Title:
For themselves and the other several Underwriters named in Schedule I to the
foregoing Agreement.
-23-
SCHEDULE I
NUMBER OF FIRM SHARES
UNDERWRITER TO BE PURCHASED
----------- ---------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated.....................
Citigroup Global Markets Inc..........................
UBS Securities LLC....................................
Bear, ▇▇▇▇▇▇▇ & Co. Inc...............................
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co...................................
▇▇▇▇▇▇ Brothers Inc. .................................
Natexis Bleichroeder Inc..............................
▇▇▇▇▇▇▇ & Company International.......................
▇▇▇▇▇▇ ▇▇▇▇ Incorporated..............................
Total:.......................................
EXHIBIT A
[FORM OF LOCK-UP LETTER]
___________, 2005
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
Citigroup Global Markets Inc.
UBS Securities LLC
Bear, ▇▇▇▇▇▇▇ & Co. Inc.
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇▇▇▇▇ Brothers Inc.
Natexis Bleichroeder Inc.
▇▇▇▇▇▇▇ & Company International
▇▇▇▇▇▇ ▇▇▇▇ Incorporated
as representatives of the several underwriters
c/o Morgan ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Dear Sirs and Mesdames:
The undersigned understands that ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated ("▇▇▇▇▇▇ ▇▇▇▇▇▇▇") and Citigroup Global Markets Inc. ("CGMI")
propose to enter into an Underwriting Agreement (the "UNDERWRITING AGREEMENT")
with Dresser-Rand Group Inc., a Delaware corporation (the "COMPANY"), providing
for the public offering (the "PUBLIC OFFERING") by the several Underwriters,
including ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and CGMI (the "UNDERWRITERS"), of [ ] shares (the
"SHARES") of the Common Stock, par value $0.01 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 ▇▇▇▇▇▇
▇▇▇▇▇▇▇ and CGMI 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 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
transactions relating to (A) shares of Common Stock or other securities acquired
in open market transactions after the completion of the offering of the Shares;
provided that no filing by any party under the Exchange Act shall be required or
shall be
A-1
voluntarily made in connection with subsequent sales of Common Stock or other
securities acquired in such open market transactions, (B) transfers of shares of
Common Stock or any security convertible, exchangeable for or exercisable into
Common Stock as a bona fide gift or gifts as a result of the operation of law or
testate or intestate succession, (C) transfers by the undersigned to a trust,
partnership, limited liability company or other entity, all of the beneficial
interests of which are held, directly or indirectly, by the undersigned or (D)
distributions of shares of Common Stock or any security convertible,
exchangeable for or exercisable into Common Stock to limited partners or
stockholders of the undersigned; provided that in the case of any transfer or
distribution pursuant to clause (B), (C) or (D), (i) each donee or distributee
shall sign and deliver a lock-up letter substantially in the form of this letter
and (ii) the undersigned and recipient shall not be required to, and shall not
voluntarily, file a report under the Exchange Act, reporting a reduction in
beneficial ownership of shares of Common Stock during the restricted period
referred to in the foregoing sentence. In addition, the undersigned agrees that,
without the prior written consent of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and CGMI 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. The undersigned also agrees and consents to the entry of stop transfer
instructions with the Company's transfer agent and registrar against the
transfer of the undersigned's shares of Common Stock except in compliance with
the foregoing restrictions.
The undersigned understands that the Company and the
Underwriters are relying upon this agreement in proceeding toward consummation
of the Public Offering. The undersigned further understands that this agreement
is irrevocable and shall be binding upon the undersigned's heirs, legal
representatives, successors and assigns.
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,
---------------------------------------
(Name)
---------------------------------------
(Address)
A-2
EXHIBIT B
, 2005
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
Citigroup Global Markets Inc.
and the other several
Underwriters named in Schedule 1
to the Underwriting Agreement
referred to below
c/o Morgan ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
We have acted as counsel to Dresser-Rand Group Inc., a Delaware
corporation (the "Company"), in connection with the purchase by you of an
aggregate of ________ shares (the "Shares") of Common Stock, par value $.01 per
share (the "Common Stock"), of the Company from the Company pursuant to the
Underwriting Agreement, dated _____ __, 2005, between you and the Company (the
"Underwriting Agreement").
We have examined the Registration Statement on Form S-1 (File No.
333-124963) (the "Registration Statement") filed by the Company under the
Securities Act of 1933, as amended (the "Securities Act"), as it became
effective under the Securities Act; the Company's prospectus, dated _____ __,
2005 (the "Prospectus"), filed by the Company pursuant to Rule 424(b) of the
rules and regulations of the Securities and Exchange Commission (the
"Commission") under the Securities Act; and the Underwriting Agreement. We also
have examined a specimen certificate representing the Common Stock of the
Company. In addition, we have examined, and have relied as to matters of fact
upon, the documents delivered to you at the closing and upon originals, or
duplicates or certified or conformed copies, of such corporate records,
agreements, documents and other instruments and such certificates or comparable
documents or oral statements of public officials and of officers and
representatives of the Company and have made such other investigations, as we
have deemed relevant and necessary in connection with the opinions hereinafter
set forth. Our opinion that the Registration Statement
B-1
has become effective under the Securities Act is based on oral advice from the
staff of the Commission to that effect.
In such examination, we have assumed the genuineness of all signatures,
the legal capacity of natural persons, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as duplicates or certified or conformed copies and the
authenticity of the originals of such latter documents.
Based upon the foregoing, and subject to the qualifications,
assumptions and limitations stated herein, we are of the opinion that:
1. The Company has been duly incorporated and is validly
existing and in good standing as a corporation under the law of the State of
Delaware and has full corporate power and authority to conduct its business as
described in the Registration Statement and Prospectus.
2. The Shares have been duly authorized and, upon payment and
delivery in accordance with the Underwriting Agreement, will be validly issued,
fully paid and nonassessable.
3. The statements made in the Prospectus under the caption
"Description of Capital Stock", insofar as they purport to constitute summaries
of the terms of the Common Stock (including the Shares), constitute accurate
summaries of the terms of such Common Stock in all material respects.
4. The Underwriting Agreement has been duly authorized,
executed and delivered by the Company.
5. The issue and sale of the Shares by the Company and the
execution, delivery and performance by the Company of the Underwriting Agreement
will not breach or result in a default under any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument filed as an exhibit to
the Registration Statement, nor will such action violate the Certificate of
Incorporation or By-laws of the Company or any federal or New York statute or
the Delaware General Corporation Law or any rule or regulation that has been
issued pursuant to any federal or New York statute or the Delaware General
Corporation Law or any order known to us issued pursuant to any federal or New
York statute or the Delaware General Corporation Law by any court or
governmental agency or body having jurisdiction over the Company or any of its
subsidiaries or any of their properties.
6. No consent, approval, authorization, order, registration or
qualification of or with any federal or New York governmental agency or body or
any Delaware governmental agency or body acting pursuant to the Delaware General
Corporation Law or, to our knowledge, any federal or New York court or any
Delaware court acting pursuant to the Delaware General
B-2
Corporation Law is required for the issue and sale of the Shares by the Company
and the compliance by the Company with all of the provisions of the Underwriting
Agreement, except for the registration under the Securities Act and the
Securities Exchange Act of 1934, as amended, of the Shares, and such consents,
approvals, authorizations, registrations or qualifications as may be required
under state securities or Blue Sky laws in connection with the purchase and
distribution of the Shares by the Underwriters.
7. The Registration Statement has become effective under the
Securities Act and the Prospectus was filed on _____ __, 2005 pursuant to Rule
424(b) of the rules and regulations of the Commission under the Securities Act
and, to our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued or proceeding for that purpose has been
instituted or threatened by the Commission.
8. There are no preemptive rights under federal or New York
law or under the Delaware General Corporation Law to subscribe for or purchase
shares of the Common Stock. Except as disclosed in the Prospectus, there are no
preemptive or other rights to subscribe for or purchase, nor any restriction
upon the voting or transfer of, any shares of the Common Stock pursuant to the
Company's Certificate of Incorporation or By-laws or any agreement or other
instrument filed as an exhibit to the Registration Statement.
9. 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, an "investment company" within the meaning of and
subject to regulation under the Investment Company Act of 1940, as amended.
We do not express any opinion herein concerning any law other than the
law of the State of New York, the federal law of the United States and the
Delaware General Corporation Law.
This opinion letter is rendered to you in connection with the
above-described transaction. This opinion letter may not be relied upon by you
for any other purpose, or relied upon by, or furnished to, any other person,
firm or corporation without our prior written consent.
Very truly yours,
▇-▇
▇▇▇▇▇▇▇ ▇
, ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
Citigroup Global Markets Inc.
and the other several
Underwriters named in Schedule 1
to the Underwriting Agreement
referred to below
c/o Morgan ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
We have acted as counsel to Dresser-Rand Group Inc., a Delaware
corporation (the "Company"), in connection with the purchase by you of an
aggregate of ___________ shares of Common Stock, par value $.01 per share (the
"Shares"), of the Company, pursuant to the Underwriting Agreement, dated
__________ __, 2005, between the Company and you (the "Underwriting Agreement").
We have not independently verified the accuracy, completeness or
fairness of the statements made or included in the Registration Statement on
Form S-1 (File No. 333-124963) filed by the Company under the Securities Act of
1933, as amended (the "Securities Act"), as it became effective under the
Securities Act (the "Registration Statement") or the Company's prospectus, dated
__________ __, 2005 (the "Prospectus"), filed by the Company pursuant to Rule
424(b) of the rules and regulations of the Securities and Exchange Commission
(the "Commission") under the Securities Act, and we take no responsibility
therefor, except as and to the extent set forth in numbered paragraph 3 of our
opinion letter to you dated the date hereof.
In connection with, and under the circumstances applicable to, the
offering of the Shares, we participated in conferences with certain officers and
employees of the Company, representatives of PricewaterhouseCoopers LLP, counsel
to the Company, your representatives and your counsel in the course of the
preparation by the Company of the Registration Statement and the Prospectus and
also reviewed certain records and documents furnished to us by the Company, as
well as the documents delivered to you at the closing. Certain of such records
and
C-1
documents were not in English or were governed by the laws of jurisdictions
other than the United States and, accordingly, we necessarily relied upon
directors, officers and employees of the Company and its subsidiaries and other
persons in evaluating such corporate records and documents. Based upon our
review of the Registration Statement and the Prospectus, our reviews made in
connection with the preparation of the Registration Statement and the
Prospectus, our participation in the conferences referred to above, our review
of the records and documents as described above, as well as our understanding of
the U.S. federal securities laws and the experience we have gained in our
practice thereunder:
(i) we advise you that each of the Registration Statement, as of
its effective date, and the Prospectus, as of its date,
appeared, on its face, to be appropriately responsive, in all
material respects, to the requirements of the Securities Act
and the applicable rules and regulations of the Commission
thereunder, except that in each case we express no view with
respect to (a) the financial statements or other financial or
statistical data contained in, or omitted from, the
Registration Statement or the Prospectus or (b) the statements
contained in or omitted from the Environmental Sections
covered in the negative assurance letter of Skadden, Arps,
Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP referenced below; and
(ii) nothing has come to our attention that causes us to believe
that the Registration Statement, as of its effective date,
contained any untrue statement of a material fact or omitted
to state any material fact required to be stated therein or
necessary in order to make the statements therein not
misleading or that the Prospectus, as of its date or as of the
date hereof, contained or contains any untrue statement of a
material fact or omitted or omits to state any 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 in each case we express no belief with
respect to (a) the financial statements or other financial or
statistical data contained in, or omitted from, the
Registration Statement or the Prospectus or (b) the statements
contained in or omitted from the Environmental Sections
covered in the negative assurance letter of Skadden, Arps,
Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP referenced below.
C-2
We understand that you will be receiving a negative assurance letter,
dated the date hereof, from Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, special
environmental counsel to the Company, in connection with the offering of the
Shares, relating to the Environmental Sections (as defined in such negative
assurance letter) referenced above.
This letter is delivered to you in connection with the above-described
transaction. This letter may not be relied upon by you for any other purpose, or
relied upon by, or furnished to, any other person, firm or corporation.
Very truly yours,
C-3
EXHIBIT D
, 2005
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
Citigroup Global Markets Inc.
and the other several
Underwriters named in Schedule I
To the Underwriting Agreement
Referred to below
c/o Morgan ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: Dresser-Rand Group Inc.
Ladies and Gentlemen:
I am the Vice President, General Counsel and Secretary of
Dresser-Rand Group Inc., a Delaware corporation (the "Company"), and have acted
as counsel for the Company and those direct and indirect subsidiaries of the
Company listed on Annex I attached hereto (collectively, the "Significant
Subsidiaries") in connection with the purchase by you of an aggregate of __
shares (the "Shares") of the Company's Common Stock, par value $.01 per share
(the "Common Stock"), from the Company pursuant to the Underwriting Agreement,
dated __________, 2005, between you and the Company (the "Underwriting
Agreement"). Unless otherwise defined herein, terms defined in the Underwriting
Agreement are used herein with the same meaning.
This opinion is delivered to you pursuant to Section 6 of the
Underwriting Agreement. Concurrent with the delivery of this opinion, (i)
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, special counsel to the Company, and (ii)
Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, special Environmental counsel to the
Company, are delivering to you separate opinions to which you are referred for
further information regarding legal matters arising under the Underwriting
Agreement.
In arriving at the opinions express below, I or the attorneys,
paralegals and other professionals under my supervision (with whom I have
consulted) have examined and relied on the following documents:
(i) an executed copy of the Underwriting Agreement;
(ii) copies of each of (i) the respective certificates of
incorporation or similar organizational documents of the Company and
the Significant Subsidiaries, each as amended to the date of this
letter and certified by the Secretary of State of Delaware, the Clerk
of the County of Cattaraugus, New York or the Commercial Tribunal of
Le Havre, as applicable, and (ii) the respective bylaws or similar
organizational documents of the Company and the Significant
Subsidiaries, each as amended to the date of this
D-1
letter and certified by an officer of the Company to be true and
correct on the date of this letter (together, the "Organizational
Documents");
(iii) the Registration Statement on Form S-1 (File No.
333-124963) (the "Registration Statement") filed by the Company under
the Securities Act of 1933, as amended (the "Securities Act"), as it
became effective under the Securities Act;
(iv) the Company's prospectus, dated ___________, 2005 (the
"Prospectus"), filed by the Company pursuant to Rule 424(b) of the
rules and regulations of the Securities and Exchange Commission (the
"Commission") under the Securities Act; and
(v) such other documents as I or the attorneys, paralegals and
other professionals under my supervision (with whom I have consulted)
have deemed necessary or appropriate as a basis for the opinions set
forth below.
In addition, I or the attorneys, paralegals or other
professionals under my supervision (with whom I have consulted) have examined
and relied upon, the originals, or duplicates or certified or conformed copies,
of all such corporate records, agreements, documents and other instruments and
such certificates or comparable documents of public officials and of officers
and representatives of the Company and its subsidiaries and have made such other
investigations of fact and law, as I have deemed relevant and necessary in
connection with the opinions hereinafter set forth.
In such examination, I have assumed the genuineness of all
signatures, the legal capacity of natural persons, the authenticity of all
documents submitted to me as originals, the conformity to original documents of
all documents submitted to me as duplicates or certified or conformed copies and
the authenticity of the originals of such latter documents. In rendering the
opinion set forth in paragraph 7 below, I have assumed that Dresser-▇▇▇▇ ▇.▇.
is validly existing and in good standing under the laws of France.
My opinion set forth in paragraph 4 below with respect to
the ownership of the outstanding shares of capital stock of the Company and the
Significant Subsidiaries is based solely upon my review of the stock ledgers of
the Company and the Significant Subsidiaries.
Based upon the foregoing and subject to the qualifications and
limitations stated herein, I am of the opinion that:
1. Each of the Company and Dresser-Rand Company has the power
and authority to own or lease, as the case may be, and to operate its
properties and conduct its business as described in the Registration
Statement and Prospectus.
2. The Company is duly qualified to do business as a foreign
corporation and is in good standing under the laws of each jurisdiction
which requires such qualification, except to the extent that the
failure to be so qualified or in good standing would not reasonably be
expected to have a Material Adverse Effect.
D-2
3. All shares of the Company's Common Stock outstanding prior
to the issuance of the Shares have been duly authorized and validly
issued and are fully paid and non-assessable.
4. All the outstanding shares of capital stock of each
Significant Subsidiary are owned by the Company either directly or
through wholly owned subsidiaries free and clear of an any security
interest, claim, lien or encumbrance (other than liens, encumbrances
and restrictions imposed in favor of the lenders under the Company's
senior secured credit agreement described in the Prospectus or
permitted thereunder).
5. The Company's authorized equity capitalization is as set
forth in the Prospectus.
6. To my knowledge, there are no pending or threatened
actions, suits or proceedings by or before any court or governmental
agency, authority or body or any arbitrator 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.
7. None of the execution and delivery of the Underwriting
Agreement or the offering and sale of the Shares will, as of the date
of this letter and after giving effect to the offering and sale of the
Shares and the application of the proceeds thereof as described in the
Prospectus, conflict with, result in a breach or violation or
imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any of its subsidiaries pursuant to, (i) the
Organizational Documents of the Company, (ii) any Applicable Contract;
or (iii) any Applicable Law, other than in the case of clauses (ii) and
(iii), such breaches, violations, liens, charges or encumbrances that
would not reasonably be expected to have a Material Adverse Effect, and
provided that I express no opinion, in the case of clause (ii), with
respect to financial ratios or tests or any aspect of the financial
condition or results of operations of the Company to the extent the
determination of such breach or violation requires quantitative
determination.
As used in this letter, (i) "Applicable Laws" means those
laws, rules or regulations of the United States of America and the State of
Ohio, which a lawyer in the State of Ohio exercising customary professional
diligence would reasonably be expected to recognize as being applicable to
transactions of the type contemplated by the Underwriting Agreement, but
excluding any securities laws of any jurisdiction and the rules and regulations
of the National Association of Securities Dealers, Inc. and (ii) "Applicable
Contract" means any agreement or instrument to which the Company or any of its
subsidiaries is a party which are filed as an exhibit to the Registration
Statement pursuant to Item 601(b) (4) or (10) of Regulation S-K.
I have not independently verified or checked the accuracy,
completeness or fairness of the statements made or included in the Registration
Statement, and I take no responsibility therefor.
In connection with, and under the circumstances applicable to
the offering and sale of the Shares, I or attorneys, paralegals and other
professionals under my supervision (with
D-3
whom I have consulted) have participated in conference calls and meetings with
certain officers and employees of the Company and its subsidiaries,
representatives of PricewaterhouseCoopers LLP, counsel to the Company and its
subsidiaries and your counsel in the course of the preparation by the Company
and its subsidiaries of the Registration Statement and the Prospectus. I or
attorneys, paralegals and other professionals under my supervision (with whom I
have consulted) also have reviewed certain records and documents of the Company
and its subsidiaries furnished to me, as well as the documents delivered to you
at the closing. Based upon our review of the Registration Statement and the
Prospectus, our participation in the conference calls and meetings referred to
above and our review of the records and documents as described above, no facts
have come to my attention that cause me to believe that the Registration
Statement, at the time it became effective, contained an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading or that the
Prospectus, as of its date or as of the date of this letter, contained or
contains any 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, except that I
express no view or belief with respect to the financial statements, schedules or
other financial or statistical data, including any pro forma financial
information, contained in or omitted from the Registration Statement and
Prospectus.
I am admitted to practice law in the State of Ohio, and do not
express any opinion herein concerning any law other than the laws of the United
States of America and the State of Ohio. To the extent that any of my opinions
set forth above are governed by the laws of any jurisdiction other than the
State of Ohio or applicable federal law, I have assumed the laws of all such
jurisdictions which may govern the Underwriting Agreement are identical in all
respects to the laws of the State of Ohio.
This letter is rendered only to the addressees hereof and is
solely for their benefit in connection with the above-described transaction.
This letter may not be relied upon, used, circulated, quoted or otherwise
referred to by you for any other purpose, or relied upon by, or furnished to,
any other person, firm or corporation without my prior written consent.
Very truly yours,
D-4
ANNEX I
SIGNIFICANT SUBSIDIARIES
Dresser-Rand Company, a New York general partnership
Dresser-▇▇▇▇ ▇.▇., a French corporation
D-5
EXHIBIT E
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
Citigroup Global Markets Inc.
And the other several Underwriters named in Schedule I To the
Underwriting Agreement referred to below
c/o Morgan ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇
Re: Dresser-Rand Group, Inc.
Ladies and Gentlemen:
We have acted as special environmental counsel to Dresser-Rand
Group Inc., a Delaware corporation (the "Company"), with respect to certain
environmental matters, in connection with the Underwriting Agreement, dated
__________, 2005 (the "Underwriting Agreement"), between the several
Underwriters named therein (the "Underwriters"), and the Company, relating to
the sale to the Underwriters of ___ shares (the "Securities") of the Company's
Common Stock, par value $ .01 per share (the "Common Stock").
This letter is being furnished to you pursuant to Section 6 of
the Underwriting Agreement.
In the above capacity, we have reviewed the following sections
(the "Environmental Sections") of the prospectus included in the registration
statement on Form S-1 (File No. 333-124963) ("Registration Statement") of the
Company relating to the Securities filed with the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933 (the "Securities
Act") and, the prospectus, dated _______, 2005 relating to the Securities (the
"Prospectus"):
1. In the "Risk Factors" section, the subsection titled:
"Environmental compliance costs and liabilities could
affect our financial condition adversely;"
2. In "The Transactions -- The Acquisition - The Equity
Purchase Agreement" section, the sixth bullet of the
second paragraph and fourth through sixth paragraphs
inclusive; and
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3. In the "Business" section, the subsection titled
"Environmental and Government Regulation;"
We have been advised by the Company that the Registration
Statement was declared effective by the Commission effective on ____________,
2005 (the "Effective Date").
Our review of the Environmental Sections has been limited to
the following: In connection with First Reserve Corporation's ("First Reserve")
acquisition of the Company from ▇▇▇▇▇▇▇▇▇-▇▇▇▇ Company Limited
("▇▇▇▇▇▇▇▇▇-▇▇▇▇"), we represented First Reserve and in that connection we
commissioned an environmental consulting firm, ENVIRON International
("ENVIRON"), to visit the Company's facilities to prepare Phase I environmental
reports, and based on its Phase I findings, to conduct Phase II sampling of soil
and groundwater. In preparing its Phase I reports, ENVIRON advised that it
relied on the information provided by the Company and we have not verified that
information. ENVIRON completed its Phase I reports between August and October
2004 and its Phase II Reports between September and October 2004. We discussed
these reports extensively with representatives of ENVIRON and ▇▇▇▇▇▇▇▇▇-▇▇▇▇,
but we did not visit any of the Company's facilities or independently
investigate these matters ourselves. The Company has advised us that no
additional environmental audits or Phase I or II investigations of the Company's
facilities have been subsequently conducted. Based upon this work and our
discussion with representatives of the Company, we provided comments to assist
in the drafting of the Environmental Sections.
We did not participate in preparation of the Registration
Statement other than in connection with our review of the Environmental Sections
and have not participated in discussions with you (or your counsel) or the
Company's accountants, or engaged in other diligence as we would have if we had
been engaged to advise the Company in the preparation of the Registration
Statement. We did, however, interview ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Chief Safety Officer,
Worldwide, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇, Safety and Environmental Manager, Product Services,
and ▇▇▇▇▇ ▇▇▇▇▇▇, Environmental Safety and Health Manager, North American
Offices of the Company. We do not pass upon, or assume any responsibility for
the accuracy, completeness or fairness of the statements made or included in the
Environmental Sections and have made no independent check or verification
thereof.
On the basis of the foregoing, no facts have come to our
attention that have caused us to believe that the Environmental Sections, taken
as a whole, as of the Effective Date, contained an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading or that the
Environmental Sections, taken as a whole, as of the date of the Prospectus and
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.
We do not, however, express any view with respect to:
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(i) any statements in or omissions from the Registration
Statement or Prospectus other than the Environmental
Sections including, without limitation, the financial
statements, schedules and other financial or
statistical data included in or excluded from the
Registration Statement or Prospectus (such
statements, the "Excluded Statements");
(ii) the effect of any statement in or omission of any
statement from the Excluded Statements; and
(iii) the effect of any matters purported to be covered in
or omitted from the Excluded Statements.
This letter is furnished only to the Underwriters and is
solely for the Underwriters' benefit in connection with the offering of the
Securities, pursuant to the Underwriting Agreement. Without our prior written
consent, this letter may not be used, circulated, quoted or otherwise referred
to for any other purpose or relied upon by, or assigned to, any other person for
any purpose, including any other person that acquires Securities or that seeks
to assert your rights in respect of this letter (other than your or the other
Underwriters' successors in interest by means of merger, consolidation, transfer
of a business or other similar transaction).
Very truly yours,
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