Exhibit 1(b)
Terms Agreement
(Attaching Underwriting Agreement Basic Provisions)
Dated as of
______________, 199__
between
▇▇▇▇▇▇ & ▇▇▇▇▇ CORPORATION
and
[Underwriters]
PREFERRED STOCK
par value
$.10 per share
▇▇▇▇▇▇ & ▇▇▇▇▇ CORPORATION
Preferred Stock, par value $.10 per share
Terms Agreement
________ __, 199_
▇▇▇▇▇▇ & ▇▇▇▇▇ Corporation
▇▇▇▇ ▇&▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
We understand that ▇▇▇▇▇▇ & ▇▇▇▇▇ Corporation (the "Company")
proposes to issue and sell $_____________ of shares of its Preferred Stock,
par value $.10 per share (the "Offered Preferred Stock"). Subject to the
terms and conditions set forth or incorporated by reference herein, the
underwriters named below (the "Underwriters") offer to purchase, severally and
not jointly, the respective number of shares of Offered Preferred Stock set
forth below opposite their respective names at the purchase price set forth
below.
Underwriting Proceeds
Number of Discounts and to the
Underwriters Shares Purchased Commissions Company
------------------- ------------------ --------------- ----------
________________... _____________ % $_____
________________... _____________ % $_____
Total........ _____________ $_________ $_____
The Offered Preferred Stock shall have the following terms:
Title of Offered Preferred Stock:
Public offering price:
Purchase price:
Current ratings: ▇▇▇▇▇'▇ Investors Service, Inc. [ ];
Standard & Poor's Corporation [ ]
Closing date, time and
location: ____________, ______, 10:00 A.M., New York City time
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Location for checking
Offered Preferred Stock: New York, New York
Wire Transfer of Funds in Settlement:
Listing requirement: [None]
Redemption provisions:
Liquidation Preference:
Sinking fund requirements:
Number of Option Shares, if any, that may be
purchased by the Underwriters:
Other terms and conditions:
All provisions contained in the document attached as Annex A
hereto entitled "▇▇▇▇▇▇ & ▇▇▇▇▇ Corporation -- Preferred Stock -- Underwriting
Agreement Basic Provisions" (the "Basic Provisions") are hereby incorporated
by reference in their entirety herein and shall be deemed to be a part of this
Terms Agreement to the same extent as if such provisions had been set forth
in full herein. For purposes of the Basic Provisions, references to the
"Representative" shall be deemed to refer ______________________. Terms
defined in the Basic Provisions are used herein as therein defined.
Please accept this offer by signing a copy of this Terms
Agreement in the space set forth below and returning the signed copy to us.
Very truly yours,
[UNDERWRITERS]
By: ____________________________
Name:
Title:
Acting on behalf of themselves and the
other named Underwriters
Accepted:
▇▇▇▇▇▇ & ▇▇▇▇▇ CORPORATION
By: _____________________________
Name:
Title:
August __, 1998
Annex A
▇▇▇▇▇▇ & ▇▇▇▇▇ CORPORATION
(a Tennessee Corporation)
Preferred Stock
UNDERWRITING AGREEMENT BASIC PROVISIONS
---------------------------------------
▇▇▇▇▇▇ & ▇▇▇▇▇ Corporation (the "Company"), proposes to issue
and sell $600 million of shares of its Preferred Stock, par value $.10 per
share (the "Preferred Stock") from time to time on terms to be determined at
the time of sale (the "Offered Preferred Stock").
This is to confirm the arrangements with respect to the
purchase of Offered Preferred Stock from the Company by the Representative and
the several Underwriters listed in the applicable terms agreement entered into
between the Representative and the Company of which this Underwriting
Agreement is Annex A thereto (the "Terms Agreement"). With respect to any
particular Terms Agreement, the Terms Agreement, together with the provisions
hereof incorporated therein by reference, is herein referred to as the
"Agreement." Terms defined in the Terms Agreement are used herein as therein
defined.
The Company has filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 (No.
333-________) for the registration of certain preferred stock and other
securities, including the Offered Preferred Stock, under the Securities Act of
1933, as amended (the "1933 Act"), and the offering thereof from time to time
in accordance with Rule 415 of the rules and regulations of the Commission
under the 1933 Act (the "1933 Act Regulations") and has filed such amendments
thereto as may have been required to the date of the Terms Agreement. Such
registration statement, as amended, has been declared effective by the
Commission.
The Company has, pursuant to Rule 424 under the 1933 Act, filed
with, or transmitted for filing to, or shall within the required period of time
hereafter file with or transmit for filing to, the Commission a prospectus
supplement (the "Prospectus Supplement") specifically relating to the Offered
Preferred Stock, together with a revised and restated prospectus relating to
preferred stock covered by the above-referenced registration statement.
The term "Registration Statement" refers to such registration
statement in the form in which it became effective, including the exhibits
thereto and the documents incorporated by reference therein, as amended to the
date hereof. The term "Basic Prospectus" means the above-referenced revised
and restated prospectus relating to Preferred Stock. The term "Prospectus"
means the Basic Prospectus supplemented by the Prospectus Supplement. The
term "Preliminary Prospectus" means a preliminary prospectus supplement
specifically relating to the Offered Preferred Stock together with the Basic
Prospectus. As used herein, the terms "Basic Prospectus," "Prospectus" and
"Preliminary Prospectus" shall include in each case the documents, if any,
incorporated by reference therein. The terms "supplement" and "amendment" or
"amend" as used herein shall include all documents deemed to be incorporated
by reference in the Prospectus that have been filed subsequent to the date of
the Basic Prospectus by the Company with the Commission pursuant to the
Securities Exchange Act of 1934, as amended (the "1934 Act").
If the Company has filed an abbreviated statement to register
additional shares of Preferred Stock pursuant to Rule 462(b) under the 1933
Act, then any reference herein to the term "Registration Statement" shall
include such Rule 462(b) registration statement.
Section 1. Representations and Warranties of the Company.
(a) The Company represents and warrants to the Representative and
to each Underwriter named in a Terms Agreement, as of the date thereof (the
"Representative Date"), as follows:
(i) Due Incorporation and Qualification. The Company has
been duly incorporated and is validly existing as a corporation
in good standing under the laws of the State of Tennessee, has
the corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the
Prospectus; and is duly qualified to do business and is in good
standing in each jurisdiction in which such qualification is
required, except where the failure to so qualify would not have a
material adverse effect on the condition, financial or otherwise,
or the earnings, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise.
(ii) Subsidiaries. Each subsidiary of the Company which
is a significant subsidiary as defined in Rule 405 of Regulation
C of the 1933 Act Regulations (each a "Significant Subsidiary")
has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the jurisdiction
of its incorporation, has corporate power and authority to own,
lease and operate its properties and to conduct its business as
described in the Prospectus and is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, except
where the failure to so qualify would not have a material adverse
effect on the condition, financial or otherwise, or the earnings,
business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise; and all of the issued
and outstanding capital stock of each Significant Subsidiary has
been duly authorized and validly issued, is fully paid and non-
assessable and, except for directors' qualifying shares (except
as otherwise stated in the Registration Statement), is owned by
the Company, directly or through subsidiaries, free and clear of
any security interest, mortgage, pledge, lien, encumbrance, claim
or equity.
(iii) Registration Statement and Prospectus. The
Registration Statement and the Prospectus, at the time the
Registration Statement became effective and as of the applicable
Representation Date, complied in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations and the
rules and regulations of the Commission promulgated thereunder.
The Registration Statement, at the time it became effective and
as of the applicable Representation Date, did not and will not,
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make
the statements therein not misleading. The Prospectus, at the
time the Registration Statement became effective and as of the
applicable Representation Date, did not, and will not, contain an
untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading; provided, however, that the representations and
warranties in this subsection shall not apply to statements in or
omissions from the Registration Statement or Prospectus made in
reliance upon and in conformity with information furnished to the
Company in writing by an Underwriter expressly for use in the
Registration Statement or Prospectus or to those parts of the
Registration Statement which constitute Statements of Eligibility
and Qualification of Trustees (Form T-1) under the 1939 Act.
No stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
initiated or threatened by the Commission.
(iv) Incorporated Documents. The documents incorporated by
reference in the Prospectus, at the time they were or hereafter
are filed with the Commission, complied and will comply in all
material respects with the requirements of the 1934 Act and the
rules and regulations promulgated thereunder (the "1934 Act
Regulations"), and, when read together and with the other
information in the Prospectus, did not and will not contain an
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary in order to make
the statements therein, in the light of the circumstances under
which they were or are made, not misleading.
(v) Accountants. The accountants who certified the financial
statements included or incorporated by reference in the
Prospectus are independent public accountants as required by the
1933 Act and the 1933 Act Regulations.
(vi) Financial Statements. The financial statements of the
Company included or incorporated by reference in the Prospectus
and the Registration Statement present fairly the financial
position of the Company as of the dates thereof and the results
of operations, changes in common stockholders' investment and
cash flows of the Company, for the respective periods covered
thereby, all in conformity with generally accepted accounting
principles applied on a consistent basis throughout the entire
period involved; and the financial schedules included or
incorporated by reference in the Registration Statement meet the
requirements of the 1933 Act Regulations or the 1934 Act
Regulations, as applicable.
(vii) Material Changes or Material Transactions. Except as
stated in the Prospectus, subsequent to the respective dates as
of which information is given in the Registration Statement and
the Prospectus, the Company has not incurred any liabilities or
obligations, direct or contingent, or entered into any
transactions which are material to the Company, and there has not
been any material adverse change in the capital stock or short-
term debt, or any material increase in long-term debt of the
Company, or any material adverse change, or any development
involving a prospective material adverse change, in the condition
(financial or other), business, prospects, net worth or results
of operations of the Company and its subsidiaries considered as
one entity.
(viii) No Defaults; Regulatory Approvals. Neither the Company
nor any of its subsidiaries is in violation of its charter or in
default in the performance or observance of any material
obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or
other instrument to which it is a party or by which it or any of
them or their properties may be bound.
The execution and delivery of this Agreement and the
consummation of the transactions contemplated herein and in the resolution of
the Company's Board of Directors setting forth the terms of the Offered
Preferred Stock (the "Series Resolution") have been duly authorized by all
necessary corporate action and executed by the Company and will not conflict
with or constitute a breach of, or default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of
the Company or any of its subsidiaries pursuant to, any contract, indenture,
mortgage, loan agreement, note, lease or other instrument to which the Company
or any such subsidiary is a party or by which it or any of them may be bound
or to which any of the property or assets of the Company or any such
subsidiary is subject, which conflict, breach or default would have,
individually or in the aggregate with any other such instances, a material
adverse effect on the condition (financial or other), business, prospects, net
worth or results of operations of the Company and its subsidiaries considered
as one entity, nor will such action result in any material violation of the
provisions of the charter or by-laws of the Company or any law, administrative
regulation or administrative or court order or decree currently in effect or
in effect at the time of execution and delivery of this Agreement and
applicable to the Company or any of its subsidiaries.
No consent, approval, authorization, order or decree of any
court or governmental agency or body is required for the consummation by the
Company of the transactions contemplated by this Agreement, except such as may
be required under the 1933 Act, the 1933 Act Regulations or state securities
or Blue Sky laws and the filing of the Series Resolution in Tennessee.
(ix) Legal Proceedings; Contracts. Except for matters
described in the Prospectus (as to which the Company can express
no opinion at this time concerning the Company's liability (if
any) or the effect of any adverse determination upon the
business, condition (financial or otherwise) or operations of the
Company), there is no pending, or to the best knowledge of any
financial officer of the Company, threatened action or proceeding
before any court or administrative agency which individually (or
in the aggregate in the case of any group of related lawsuits) is
expected to have a material adverse effect on the financial
condition of the Company and its subsidiaries considered as one
entity.
(x) Compliance with Laws. The Company's business and
operations comply in all material respects with all laws and
regulations applicable thereto and there are no known, proposed
or threatened changes in any laws or regulations which would have
a material adverse effect on the Company or the manner in which
it conducts its business. The Company possesses all valid and
effective certificates, licenses and permits required to conduct
its business as now conducted, except for instances which
individually or in the aggregate do not, or will not, have a
material adverse effect on the condition (financial or other),
business, prospects or results of operations of the Company and
its subsidiaries considered as one entity.
(xi) Capital Stock. The authorized capital stock of the
Company and the provisions of the Series Resolution conform as to
legal matters to the descriptions thereof contained in the
Prospectus.
(xii) Validity of the Offered Preferred Stock. The Offered
Preferred Stock has 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.
(xiii) Registration Rights. Except for matters described in the
Prospectus, there are no contracts or agreements between the
Company and any person granting such person the right to require
the Company to file a registration statement under the 1933 Act
with respect to any equity securities of the Company or to
require the Company to include such securities with the Preferred
Stock registered pursuant to the Registration Statement.
(b) Additional Certifications. Any certificate signed by any
officer of the Company and delivered to the Representative and the counsel for
the Underwriters in connection with an offering of the Offered Preferred Stock
shall be deemed a representation and warranty by the Company to each
Underwriter participating in such offering as to the matters covered thereby on
the date of such certificate unless subsequently amended or supplemented
subsequent thereto.
Section 2. Purchase and Sale.
(a) The obligations of the Underwriters to purchase, and the
Company to sell, the Offered Preferred Stock shall be evidenced by the Terms
Agreement. The Terms Agreement specifies the total number of shares of the
Offered Preferred Stock, the names of the Underwriters participating in the
offering and the number of shares each Underwriter severally has agreed to
purchase, the purchase price to be paid by the Underwriters for the Offered
Preferred Stock, the public offering price and any terms of the Offered
Preferred Stock not already specified (including, but not limited to,
designations, current ratings, listing requirements, redemption provisions,
liquidation preference and sinking fund requirements).
The several commitments of the underwriters to purchase Offered
Preferred Stock pursuant to the Terms Agreement shall be deemed to have been
made on the basis of the representations and warranties herein contained and
shall be subject to the terms and conditions herein set forth.
(b) Subject to the terms and conditions herein set forth, the
Company may grant, if so provided in the Terms Agreement relating thereto, an
option to the Underwriters, severally and not jointly, to purchase additional
shares of Preferred Stock to cover over-allotments, if any (the "Option
Shares"). If the Terms Agreement so provides, the Underwriters may purchase
up to the amount of Option Shares set forth therein at the same price per
share as is applicable to the Offered Preferred Stock. As used herein, the
term "Offered Preferred Stock" shall include Option Shares. Such option, if
granted, will expire 30 days after the date of this Agreement, and may be
exercised in whole or in part from time to time only for the purpose of
covering over-allotments which may be made in connection with the offering of
the Offered Preferred Stock upon notice by the Representative to the Company
setting forth the number of Option Shares as to which the several Underwriters
are then exercising the option and the time and date of payment and delivery
for such Option Shares.
Any such time and date of delivery shall be determined by the
Representative, but shall not be later than four business days and not be
earlier that two business days after the exercise of said option, nor in any
event prior to Closing Time, unless otherwise agreed upon by the
Representative and the Company.
If the option is exercised as to all or any portion of the
Option Shares, each Underwriter, acting severally and not jointly, will
purchase that proportion of the total number of Option Shares then being
purchased which the number of shares of Offered Preferred Stock each such
Underwriter has agreed to purchase as set forth in the Terms Agreement bears
to the total number of shares of Offered Preferred Stock, subject to such
adjustments as the Representative shall make to eliminate any sales or
purchases of fractional shares of Preferred Stock.
(c) Payment of the purchase price for any Offered Preferred Stock
to be purchased by the Underwriters shall be made to the Company at either the
Company's offices in Memphis, Tennessee or the office of ▇▇▇▇▇ ▇▇▇▇ &
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or at such other
place as shall be agreed upon by the Representative and the Company, at 10:00
A.M., New York City time, on the third business day (unless postponed in
accordance with the provisions of Section 10) following the date of the Terms
Agreement or at such other date, time or location specified in the Terms
Agreement, or as otherwise shall be agreed upon by the Representative and the
Company (such time and date being referred to as a "Closing Time").
Certificates for the Offered Preferred Stock shall be in
definitive form and registered in such names and in such denominations as the
Representative shall request in writing at least two business days prior to
the Closing Time. Delivery of the Offered Preferred Stock shall be made to
the Underwriters as specified in the Terms Agreement against payment by such
Underwriters of the purchase price thereof to the Company (or such other
person as the Company may direct) by wire transfer of immediately available
funds. Such Offered Preferred Stock will be made available for examination
and packaging by the Representative in New York, New York, on or before the
first business day prior to the Closing Time or at such other time and place
specified in the Terms Agreement.
Section 3. Covenants of the Company.
The Company covenants with the Representative and with each
other Underwriter as follows:
(a) Prospectus Supplement. Immediately following the execution of
this Agreement, the Company will prepare a Prospectus Supplement in connection
with the offering of the Offered Preferred Stock. The Company will promptly
transmit copies of the Prospectus Supplement to the Commission for filing
pursuant to Rule 424 of the 1933 Act Regulations.
(b) Notice of Certain Events. The Company will notify the
Representative promptly (i) of the effectiveness of any amendment to the
Registration Statement, (ii) of the transmittal to the Commission for filing of
any supplement to the Prospectus or any document to be filed pursuant to the
1934 Act which will be incorporated by reference in the Prospectus, (iii) of
the receipt of any comments from the Commission with respect to the
Registration Statement, the Prospectus or the Prospectus Supplement relating
in any way to the offer and sale of the Offered Preferred Stock, (iv) of any
request by the Commission for any amendment to the Registration Statement or
any amendment or supplement to the Prospectus or for additional information,
and (v) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any
proceedings for that purpose.
(c) Notice of Certain Proposed Filings. The Company will give the
Representative notice of its intention to file or prepare any amendment to the
Registration Statement or any amendment or supplement to the Prospectus, and
will furnish the Representative with copies of any such amendment or
supplement or other documents proposed to be filed or prepared a reasonable
time in advance of such proposed filing or preparation, as the case may be.
(d) Copies of the Registration Statement and the Prospectus. The
Company will deliver to the Representative as many signed and conformed copies
of the Registration Statement (as originally filed) and of each amendment
thereto (including exhibits filed therewith or incorporated by reference
therein and documents incorporated by reference in the Prospectus) as the
Representative may reasonably request. The Company will furnish to the
Representative as many copies of the Prospectus (as amended or supplemented)
as the Representative shall reasonably request so long as the Underwriters are
required to deliver a Prospectus in connection with sales or solicitations of
offers to purchase the Offered Preferred Stock.
(e) Revisions of Prospectus -- Material Changes. If at any time
when the Prospectus is required by the 1933 Act to be delivered in connection
with sales of the Offered Preferred Stock any event shall occur or condition
exist as a result of which it is necessary, in the reasonable opinion of
counsel for the Company, to further amend or supplement the Prospectus in
order that the Prospectus will not include an untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements therein not misleading in the light of the circumstances existing
at the time it is delivered to a purchaser, or if it shall be necessary, in
the reasonable opinion of such counsel, at any such time to amend or
supplement the Registration Statement or the Prospectus in order to comply
with the requirements of the 1933 Act or the 1933 Act Regulations the Company
will promptly prepare and file with the Commission such amendment or
supplement, whether by filing documents pursuant to the 1934 Act, the 1933 Act
or otherwise, as may be necessary to correct such untrue statement or omission
or to make the Registration Statement and Prospectus comply with such
requirements.
(f) Earnings Statements. The Company will make generally available
to its security holders as soon as practicable after the close of the period
covered thereby, an earnings statement (in form complying with the provisions
of Rule 158 under the ▇▇▇▇ ▇▇▇) covering each twelve-month period beginning,
in each case, not later than the first day of the Company's fiscal quarter
next following the "effective date" (as defined in such Rule 158) of the
Registration Statement with respect to each sale of Offered Preferred Stock.
(g) Blue Sky Qualifications. The Company will endeavor, in
cooperation with the Underwriters, to qualify the Offered Preferred Stock for
offering and sale under the applicable securities laws of such states and other
jurisdictions of the United States as the Underwriters may designate, and will
maintain such qualifications in effect for so long as may be required for the
distribution of the Offered Preferred Stock; provided, however, that the
Company shall not be obligated to file any general consent to service of
process or to qualify as a foreign corporation or to subject itself to
taxation as doing business in any jurisdiction in which it is not otherwise
required to be so qualified. The Company will file such statements and
reports as may be required by the laws of each jurisdiction in which the
shares of Offered Preferred Stock have been qualified as provided above.
(h) 1934 Act Filings. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act, will file promptly
all documents required to be filed with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the 1934 Act.
Section 4. Payment of Expenses.
The Company will pay all expenses incident to the performance
of its obligations under this Agreement, including:
(i) the preparation and filing of the Registration Statement
and all amendments thereto, the Preliminary Prospectus, if any, and
the Prospectus and any amendments or supplements thereto;
(ii) the filing of this Agreement;
(iii) the preparation, issuance, printing and delivery of the
Offered Preferred Stock;
(iv) the reasonable fees and disbursements of the Company's
accountants and counsel, and of the transfer agent;
(v) the qualification of the Offered Preferred Stock under
securities laws in accordance with the provisions of Section
3(g), including filing fees and the reasonable fees and
disbursements of counsel to the Underwriters in connection
therewith and in connection with the preparation of any Blue Sky
Survey; and
(vi) the printing and delivery to the Underwriters in
quantities as hereinabove stated of copies of the Registration
Statement and any amendments thereto, and of the Prospectus and
any amendments or supplements thereto.
If this Agreement is terminated by the Representative in
accordance with the provisions of Section 5 or clause (i) of Section 9 hereof,
the Company shall reimburse upon demand the Underwriters for all of their
out-of-pocket expenses, including the reasonable fees and disbursements of
counsel for the Underwriters that shall have been incurred by the Underwriters
in connection with the proposed purchase and sale of the Offered Preferred
Stock.
Section 5. Conditions of Underwriters' Obligation.
The several obligations of the Underwriters to purchase the
Offered Preferred Stock pursuant to the Terms Agreement will be subject at all
times to the accuracy of the representations and warranties on the part of the
Company herein, to the accuracy of the statements of the Company's officers
made in any certificate furnished pursuant to the provisions hereof, to the
performance and observance by the Company of all covenants and agreements
contained therein, or in the Terms Agreement, on its part to be performed and
observed and to the following additional conditions precedent:
(a) Stop Order; Ratings Change; etc. At the Closing Time, (i) no
stop order suspending the effectiveness of the Registration Statement shall
have been issued under the 1933 Act or proceedings therefor initiated or
threatened by the Commission, (ii) the rating assigned as of the date of this
Agreement by any "nationally recognized statistical rating organization," as
such term is defined for purposes of Rule 436(g) under the 1933 Act
Regulations, to any debt securities of the Company shall not have been lowered
since the execution of this Agreement nor shall any such rating organization
have publicly announced that it has placed any debt securities of the Company
on what is commonly termed a "watch list" for possible downgrading, and (iii)
there shall not have come to the attention of the Representative any facts
that would cause the Representative to believe that the Prospectus, including
the Prospectus Supplement, at the time it was required to be delivered to a
purchaser of the Offered Preferred Stock, contained an untrue statement of a
material fact or omitted to state a material fact necessary in order to make
the statements therein, in the light of the circumstances existing at such
time, not misleading.
(b) Legal Opinions. At the Closing Time, the Representative shall
have received the following documents:
(1) Opinion of Company Counsel. The opinion of the Vice
President-General Counsel and Secretary of the Company or the Assistant
Secretary and Corporate Counsel of the Company, dated as of such date, in form
and substance reasonably satisfactory to the Representative, to the effect as
set forth in Exhibit A.
(2) Opinion of Counsel to the Underwriters. The opinion of
__________________________________, counsel to the Underwriters, with respect
to such matters as the Representative may reasonably request.
(c) Officer Certificate. At the Closing Time, there shall not have
been, since the respective dates as of which information is given in the
Registration Statement and the Prospectus, any material adverse change in the
condition (financial or otherwise) of the Company, or in the earnings or
business affairs of the Company; and the Representative shall have received a
certificate of any Vice President of the Company, dated as of the Closing
Time, to the effect (i) that there has been no such material adverse change,
(ii) that the other representations and warranties of the Company contained in
Section 1 are true and correct in all material respects with the same force
and effect as though expressly made at and as of the date of such certificate,
except to the extent that such representations and warranties expressly relate
to an earlier date or later date (in which case such representations and
warranties are true and correct on and as of such earlier date or will be true
and correct on and as of such later date, as the case may be), (iii) that the
Company has made or caused to be made any required filing of the Prospectus
pursuant to Rule 424(b) in the manner and within the time period required by
Rule 424(b), and (iv) that the Company has complied with all material
agreements and satisfied all material conditions on its part to be performed
or satisfied at or prior to the date of such certificate. The officer signing
and delivering this certificate may rely upon the best of his or her knowledge
as to proceedings threatened.
(d) Comfort Letter. At the time of the execution of the Terms
Agreement and at the Closing Time, the Representative shall have received a
letter from KPMG Peat Marwick LLP or their successors as the Company's
independent accountants (the "Independent Accountants"), dated as of the date
of the Terms Agreement and of the Closing Time, as the case may be, in form
and substance satisfactory to the Representative to the effect that:
(i) they are independent public accountants within the
meaning of the 1933 Act and the 1933 Act Regulations;
(ii) in their opinion the Company's financial statements and
schedules included or incorporated by reference in the
Registration Statement and Prospectus and covered by their
reports included or incorporated therein comply as to form in all
material respects with the applicable accounting requirements of
the 1933 Act and the 1933 Act Regulations or the 1934 Act and the
1934 Act Regulations, as the case may be;
(iii) they have conducted reviews of the unaudited interim
consolidated financial information of the Company included in the
Company's Quarterly Reports on Form 10-Q incorporated in the
Registration Statement and Prospectus in compliance with the
standards for such reviews promulgated by the American Institute
of Certified Public Accountants;
(iv) on the basis of a reading of the financial statements and
schedules of the Company included or incorporated in the
Prospectus and the Registration Statement, and the latest
available unaudited interim financial statements of the Company,
inquiries of officials of the Company responsible for financial
and accounting matters, and other specified procedures and
inquiries, nothing has come to their attention that caused them
to believe that:
(A) the unaudited financial statements of the Company
included or incorporated in the Prospectus and the
Registration Statement do not comply as to form in all
material respects with the applicable accounting
requirements of the 1933 Act and the 1933 Act Regulations or
the 1934 Act and the 1934 Act Regulations thereunder, as the
case may be, or that such unaudited financial statements are
not presented fairly in conformity with generally accepted
accounting principles;
(B) with respect to the period subsequent to the
date of the most recent financial statements incorporated in
the Registration Statement and the Prospectus, as of a
specified date not more than five business days prior to the
date of delivery of such letter, there has been any change
in the common or preferred stock or long-term debt of the
Company or, as of such date, there has been any decrease in
assets or common stockholders' investment, in each case as
compared with amounts shown in the most recent consolidated
balance sheet of the Company included or incorporated in the
Registration Statement and the Prospectus, except in each
case for changes or decreases which the Prospectus discloses
have occurred or may occur or which are described in such
letter; or
(C) for the period from the date of the most recent
financial statements incorporated in the Registration
Statement and the Prospectus to such specified date, there
was any decrease in operating revenues, operating income,
income before taxes or net income of the Company in each
case as compared with the comparable period of the preceding
year, except in each case for decreases which the Prospectus
discloses have occurred or may occur or which are described
in such letter; and
(v) in addition to their audit referred to in their reports
included or incorporated by reference in the Registration
Statement and the Prospectus and the reviews, inquiries and
procedures referred to in clauses (iii) and (iv) above, such
letter shall state that KPMG Peat Marwick LLP has performed other
specified procedures, with respect to certain numerical data and
information included or incorporated in the Registration
Statement and the Prospectus, as are requested by the
Representative and specified in such letter and have found such
data and information to be in agreement with the accounting
records of or analyses prepared by the Company.
(e) Other Documents. At the Closing Time, counsel for the
Underwriters shall have been furnished with such documents and opinions as
such counsel may reasonably require for the purpose of enabling such counsel
to pass upon the issuance and sale of Offered Preferred Stock as herein
contemplated and related proceedings, or in order to evidence the accuracy and
completeness of any of the representations and warranties, or the fulfillment
of any of the conditions, herein contained; and all proceedings taken by the
Company in connection with the issuance and sale of Offered Preferred Stock
as herein contemplated shall be satisfactory in form and substance to the
Representative.
Section 6. Indemnification.
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the 1933 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, arising out of any untrue statement of a
material fact contained in the Registration Statement (or any
amendment thereto), or the omission therefrom of a material fact
required to be stated therein or necessary to make the statements
therein not misleading or arising out of or based upon any untrue
statement of a material fact contained in the Prospectus (or any
amendment or supplement thereto) or the omission therefrom of a
material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, to the extent of the aggregate amount paid in
settlement of any litigation, or investigation or proceeding by
any governmental agency or body, commenced or threatened, or of
any claim whatsoever arising out of or based upon any such untrue
statement or omission, if such settlement is effected with the
written consent of the Company; and
(iii) against any and all expense whatsoever, reasonably
incurred in investigating, preparing or defending against any
litigation, or investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever
arising out of or based upon any such untrue statement or
omission, to the extent that any such expense is not paid under
(i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission made in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through the
Representative expressly for use in the Registration Statement (or any
amendment thereto) or the Prospectus (or any amendment or supplement thereto),
or made in reliance upon the Statements of Eligibility and Qualification of
Trustees (Form T-1) under the 1939 Act filed as exhibits to the Registration
Statement; and provided, further, that the foregoing indemnity agreement, with
respect to any Preliminary Prospectus shall not inure to the benefit of any
Underwriter from whom the person asserting any such losses, claims, damages or
liabilities purchased Offered Preferred Stock, or any person controlling such
Underwriter, if a copy of the Prospectus (as then amended or supplemented if
the Company shall have furnished any amendments or supplements thereto) was not
sent or given by or on behalf of such Underwriter to such person, if required
by law so to have been delivered, at or prior to the written confirmation of
the sale of the Offered Preferred Stock to such person, and if the Prospectus
(as so amended or supplemented) would have cured the defect giving rise to such
losses, claims, damages or liabilities.
(b) Each Underwriter severally agrees to indemnify and hold
harmless the Company, its directors and officers and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act against
any and all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a) of this Section, as incurred, but only
with respect to untrue statements or omissions made in the Registration
Statement (or any amendment thereto) or the Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with written
information furnished to the Company by such Underwriters through the
Representative expressly for use in the Registration Statement (or any
amendment thereto) or the Prospectus (or any amendment or supplement thereto).
(c) Each indemnified party shall give prompt notice to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve such indemnifying party from any liability which it may
have otherwise than on account of this indemnity agreement. An indemnifying
party may participate at its own expense in the defense of such action. In no
event shall the indemnifying parties be liable for the fees and expenses of
more than one counsel (in addition to any local counsel) separate from their
own counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances.
Section 7. Contribution.
In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in Section 6 is
for any reason held to be unenforceable by the indemnified parties although
applicable in accordance with its terms, the Company and the Underwriters of
each offering of Offered Preferred Stock shall contribute to the aggregate
losses, liabilities, claims, damages and expenses of the nature contemplated
by said indemnity agreement incurred by the Company and one or more of the
Underwriters in respect of such offering, as incurred, in such proportions
that the Underwriters are responsible for that portion represented by the
percentage that the underwriting discount appearing on the cover page of the
Prospectus in respect of such offering bears to the initial public offering
price appearing thereon and the Company is responsible for the balance;
provided, however, that no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the ▇▇▇▇ ▇▇▇) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
For purposes of this Section, each person, if any, who controls
an Underwriter within the meaning of Section 15 of the 1933 Act shall have the
same rights to contribution as such Underwriter, and each director of the
Company, each officer of the Company who signed the Registration Statement,
and each person, if any, who controls the Company within the meaning of
Section 15 of the 1933 Act shall have the same rights to contribution as the
Company.
Section 8. Representations, Warranties and Agreements to
Survive Delivery.
All representations, warranties and agreements contained in this
Agreement, or contained in certificates of officers of the Company submitted
pursuant hereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any Underwriter or
controlling person, or by or on behalf of the Company, and shall survive each
delivery of and payment for any of the Offered Preferred Stock.
Section 9. Termination of Agreement.
The Representative may terminate this Agreement, immediately upon
notice to the Company, at any time prior to the Closing Time if: (i) there has
been, since the date hereof or since the respective dates as of which
information is given in the Registration Statement, any material adverse change
in the condition, financial or otherwise, or in the earnings or business
affairs of the Company, (ii) there shall have occurred any material adverse
change in the financial markets in the United States or any outbreak or
escalation of hostilities or other national or international calamity or
crisis, the effect of which shall be such as to make it, in your judgment of
the Representative, impracticable to market the Offered Preferred Stock or
enforce contracts for the sale of the Offered Preferred Stock, or (iii) trading
in any securities of the Company shall have been suspended by the Commission or
a national securities exchange, or if trading generally on either the American
Stock Exchange or the New York Stock Exchange shall have been suspended, or
minimum or maximum prices for trading shall have been fixed, or maximum ranges
for prices for securities shall have been required, by either of said exchanges
or by order of the Commission or any other governmental authority, or if a
banking moratorium shall have been declared by either federal or New York
authorities.
In the event of any termination of this Agreement, the covenant
set forth in Section 3(f) hereof, the provisions of Section 4 hereof, the
indemnity and contribution agreements set forth in Sections 6 and 7 hereof,
and the provisions of Sections 8 and 13 hereof shall remain in effect.
Section 10. Default by One Underwriter.
If any Underwriter shall fail at the Closing Time to purchase
the Offered Preferred Stock which it is obligated to purchase hereunder (the
"Defaulted Securities"), and the aggregate amount of Defaulted Securities is
not more than one-tenth of the aggregate amount of the Offered Preferred Stock
to be purchased on such date, the other Underwriters shall be obligated
severally in the proportions that the amount of the Offered Preferred Stock set
forth opposite their respective names in Schedule I hereto bears to the
aggregate amount of Offered Preferred Stock set forth opposite the names of
all such non-defaulting underwriters to purchase the Defaulted Securities;
provided that in no event shall the amount of Defaulted Securities that any
Underwriter has agreed to purchase pursuant to this Agreement be increased by
an amount in excess of one-ninth of such amount of Offered Preferred Stock
without the written consent of such Underwriter. If the aggregate amount of
Defaulted Securities is more than one-tenth of the aggregate amount of the
Offered Preferred Stock to be purchased on the Closing Date, and arrangements
satisfactory to the Underwriters and the Company for the purchase of such
Defaulted Securities are not made within 36 hours after such default, this
Agreement shall terminate without liability on the part of any non-defaulting
Underwriters or the Company.
No action taken pursuant to this Section shall relieve a defaulting
Underwriter from liability in respect of its default under this Agreement.
In the event of any such default which does not result in a
termination of this Agreement, either the non-defaulting Underwriters or the
Company shall have the right to postpone the Closing Time for a period not
exceeding seven days in order to effect any required changes in the
Registration Statement or Prospectus or in any other documents or arrangements.
Section 11. Notices.
All notices and other communications hereunder shall be in writing
and shall be deemed to have been duly given if mailed, delivered by an express
courier service or transmitted by any facsimile communication. Notices to the
Underwriters shall be directed to the Representative at the address specified
in the Terms Agreement, with copies thereof directed to [Designated
Underwriters' counsel]. Notices to the Company shall be directed to it at ▇▇▇▇
▇&▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Vice President-Finance and
Treasurer, with copies thereof directed to the Legal Department of the Company
at ▇▇▇▇ ▇&▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Vice
President-General Counsel and Secretary.
Section 12. Parties.
This Agreement shall inure to the benefit of and be binding upon the
Company and any Underwriter who becomes a party hereto and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
parties hereto and their respective successors and the controlling persons and
officers and directors referred to in Sections 6 and 7 and their heirs and
legal representatives, any legal or equitable right, remedy or claim under or
in respect of this Agreement or any provision herein contained. This Agreement
and all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the parties hereto their respective successors and said
controlling persons and officers and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation.
No purchaser of Offered Preferred Stock from any Underwriter shall be deemed to
be a successor by reason merely of such purchase.
Section 13. Governing Law.
This Agreement and the rights and obligations of the parties created
hereby and thereby shall be governed by and construed in accordance with the
laws of the State of New York applicable to agreements made and to be performed
in such state. Any suit, action or proceeding brought by the Company against
an Underwriter in connection with or arising under this Agreement shall be
brought solely in the state or federal court of appropriate jurisdiction
located in the Borough of Manhattan, The City of New York.
Exhibit A
Form of Opinion of Company Counsel
----------------------------------
____________, ______
[UNDERWRITERS]
Re: ▇▇▇▇▇▇ & ▇▇▇▇▇ Corporation
Preferred Stock (the "Offered Preferred Stock")
Ladies and Gentlemen:
This opinion is directed to the Underwriters pursuant to
Section 5(b)(1) of the Underwriting Agreement Basic Provisions and the Terms
Agreement (of which the Underwriting Agreement Basic Provisions is Annex A
thereto) dated ________________, 199__ (collectively, the "Underwriting
Agreement"), among the Company and you, with respect to the offer and sale of
the Offered Preferred Stock. All terms defined or used in the Underwriting
Agreement have the same meaning when used herein, unless otherwise noted.
I am Vice President-General Counsel and Secretary of the Company
and have acted as such in connection with the Offered Preferred Stock and the
Underwriting Agreement. I or attorneys under my supervision have made such
examination and investigation as we have deemed necessary in order to give the
following opinion.
Based on the foregoing, it is my opinion that:
(i) The Company is a corporation duly incorporated,
validly existing and in good standing under the laws of the State
of Tennessee and has full corporate power and authority under
such laws to own its properties and to conduct its business as
described in the Prospectus; the Company is duly qualified to do
business and is in good standing in each jurisdiction in which it
owns or leases real property or in which the conduct of its
business requires such qualification, except for such instances
which in the aggregate will not have a material adverse effect on
the Company;
(ii) Each subsidiary of the Company which is a
significant subsidiary as defined in Rule 405 of Regulation C of
the 1933 Act Regulations (each a "Significant Subsidiary") has
been duly incorporated and is validly existing as a corporation
in good standing under the laws of the jurisdiction of its
incorporation, has corporate power and authority to own, lease
and operate its properties and conduct its business as described
in the Registration Statement, and, to the best of my knowledge,
is duly qualified to do business and is in good standing in each
jurisdiction in which such qualification is required, except
where the failure to so qualify would not have a material adverse
effect on the condition, financial or otherwise, or the earnings,
business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise; all of the issued and
outstanding capital stock of each Significant Subsidiary has been
duly authorized and validly issued and is fully paid and non-
assessable, and all of such capital stock, except for directors'
qualifying shares, is owned by the Company, directly or through
subsidiaries, free and clear of any mortgage, pledge, lien,
encumbrance, claim or equity;
(iii) Except for matters described in the Prospectus
(as to which I can express no opinion at this time concerning the
Company's liability (if any) or the effect of any adverse
determination upon the business, condition (financial or
otherwise) or operations of the Company), there is no pending, or
to my knowledge, threatened action or proceeding before any court
or administrative agency which individually (or in the aggregate
in the case of any group of related lawsuits) is expected to have
a material adverse effect on the financial condition of the
Company;
(iv) The authorized capital stock of the Company
conforms as to legal matters to the description thereof contained
in the Prospectus;
(v) The Offered Preferred Stock has 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;
(vi) The Company possesses all permits, approvals,
franchises and other rights which are requisite for the conduct
of its business as described in the Prospectus or for the actions
contemplated by the Underwriting Agreement and the offering
contemplated by the Prospectus;
(vii) I have reviewed or caused to be reviewed by
attorneys under my supervision the Registration Statement, the
Prospectus and each amendment and supplement thereto (including
the documents incorporated by reference) and have no reason to
believe that, as of their respective effective or issue dates, as
of the date of the Terms Agreement or as of the Closing Time,
either the Registration Statement or the Prospectus or any such
amendment or supplement (or any such documents incorporated by
reference) 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;
(viii) I do not know of any statute or regulation or
legal or governmental proceeding required to be described in the
Prospectus which is not described as required, nor of any
contract or document of a character required to be described in
the Registration Statement or the Prospectus or to be filed as
exhibits to the Registration Statement which is not described and
filed as required; and the descriptions in the Registration
Statement and the Prospectus of the contracts and other documents
therein described are accurate and fairly present the information
required to be shown;
(ix) The execution and delivery by the Company of the
Underwriting Agreement and the consummation by the Company of the
transactions herein and therein contemplated and compliance with
the terms of the Underwriting Agreement do not and will not
conflict with or result in a breach of any of the terms of the
Charter or By-laws of the Company, and will not conflict with or
result in a breach of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of
trust, loan, credit or note agreement, lease or other agreement
or instrument material to the Company to which the Company is a
party or by which it or any or its properties are bound, or any
existing applicable law, rule, regulation, judgment, order or
decree of any government, governmental instrumentality or court,
having jurisdiction over the Company or any of its properties;
(x) No authorization, approval, consent or license of
any regulatory body or authority (other than under the 1933 Act
and the securities or Blue Sky laws of the various states) is
required for the valid authorization, issuance, sale and delivery
of the Offered Preferred Stock as herein contemplated or the
valid authorization, execution, delivery and performance by the
Company of the Underwriting Agreement or the consummation by the
Company of the transactions contemplated herein or therein, or,
if so required, all such authorizations, approvals, consents and
licenses, specifying the sale, have been obtained and are in full
force and effect;
(xi) The Registration Statement has become effective
under the 1933 Act and, to the best of my knowledge, no stop
order suspending the effectiveness of the Registration Statement
has been issued and no proceedings for that purpose have been
instituted or are pending or contemplated under the 1933 Act; the
Registration Statement and the Prospectus, and each amendment or
supplement thereto (except for the financial statements and
schedules included therein, as to which I express no opinion),
comply as to form in all material respects to the requirements of
the 1933 Act and the 1933 Act Regulations and, as to documents
incorporated therein, to the requirements of the 1934 Act and the
1934 Act Regulations in effect at the time such documents were
filed with the Commission; and
(xii) The Underwriting Agreement has been duly and
validly authorized, executed and delivered by the Company and
constitutes a valid and binding agreement of the Company,
enforceable in accordance with its terms, except as limited by
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting enforcement of creditors'
rights or by general equity principles and subject to any
principles of public policy limiting the right to enforce the
indemnification and contribution provisions contained in Sections
6 and 7 of the Underwriting Agreement.
In rendering the foregoing opinion, we have assumed that (i) all
signatures on all documents examined by us are genuine and that where any such
signature (other than a signature purporting to have been made on behalf of
the Company) purports to have been made in a corporate, governmental,
fiduciary or other capacity, the person who affixed such signature had the due
authority to do so, (ii) certain factual matters contained in certificates of
public officials are accurate, true and correct, and (iii) photostat copies of
such documents, records and certificates conform to the originals.
This opinion is intended solely for the benefit of the
Underwriters and is not to be relied on by, and no copies of it are to be
delivered to, any other person without my prior written consent, except that
Underwriters' counsel may rely upon this opinion as to all matters of
Tennessee law corporate law in rendering its opinion of even date herewith. I
am not assuming any professional responsibility to any other person by
rendering this opinion. It is understood that this opinion speaks as of the
date given, notwithstanding any delivery as contemplated above on any other
date.
Very truly yours,
