EXHIBIT 1.02
ALLIED WASTE INDUSTRIES, INC.
2,000,000 Shares
[ ]% Series D Senior Mandatory Convertible Preferred Stock
($0.10 Par Value)
UNDERWRITING AGREEMENT
, 2005
UNDERWRITING AGREEMENT
Citigroup Global Markets Inc.
▇.▇. ▇▇▇▇▇▇ Securities Inc.
as Representatives of the several Underwriters
c/o Citigroup Global Markets Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
c/o ▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Allied Waste Industries, Inc., a Delaware corporation (the "COMPANY"),
proposes to issue and sell to the underwriters named in Schedule A annexed
hereto (the "UNDERWRITERS"), for whom Citigroup Global Markets Inc. and ▇.▇.
▇▇▇▇▇▇ Securities Inc. are acting as representative(s) (together, the
"REPRESENTATIVES"), an aggregate of 2,000,000 shares (the "FIRM SHARES") of [ ]%
Series D Senior Mandatory Convertible Preferred Stock, $0.10 par value (the
"PREFERRED STOCK"), of the Company. In addition, solely for the purpose of
covering over-allotments, the Company proposes to grant to the Underwriters the
option to purchase from the Company up to an additional 300,000 shares of
Preferred Stock upon the terms and conditions set forth below (the "ADDITIONAL
SHARES"). The Firm Shares and the Additional Shares are hereinafter collectively
sometimes referred to as the "SHARES." The Shares are described in the
Prospectus which is referred to below.
The Company has filed, in accordance with the provisions of the Securities
Act of 1933, as amended, and the rules and regulations thereunder (collectively,
the "ACT"), with the Securities and Exchange Commission (the "COMMISSION") a
registration statement on Form S-3, as amended (File No. 333-115329), including
a prospectus, relating to the Shares and the shares of common stock, par value
$0.01 per share, of the Company (the "COMMON STOCK") issuable by the Company
upon conversion of the Preferred Stock (the "COMMON STOCK SHARES"), which
incorporates by reference documents which the Company has filed or will file in
accordance with the provisions of the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder (collectively, the "EXCHANGE
ACT"). The Company has furnished to you, for use by the Underwriters and by
dealers, copies of a preliminary prospectus and the documents incorporated by
reference therein (together, a "PRELIMINARY PROSPECTUS") relating to the Shares
and the Common Stock Shares. Except where the context otherwise requires, the
registration statement, as amended at the time of this Agreement, including all
documents filed as a part thereof or incorporated by reference therein, and
including any information contained in a prospectus subsequently filed with the
Commission pursuant to Rule 424(b) under the Act and deemed to be part of the
registration statement and also including any registration statement filed
pursuant to Rule 462(b) under the Act, is herein called the "REGISTRATION
STATEMENT," and the prospectus, including all documents incorporated therein by
reference, in the form filed by the Company with the Commission pursuant to Rule
424(b) under the Act on or before the second business day after the date hereof
(or such earlier time as may be required under the Act) or, if no such filing is
required, the form of final prospectus included in the Registration Statement at
the time it became effective, is herein called the "PROSPECTUS." As used herein,
"business day" shall mean a day on which the New York Stock Exchange is open for
trading.
1. AGREEMENTS TO SELL AND PURCHASE.
On the basis of the representations, warranties and covenants contained in
this Agreement, and subject to the terms and conditions contained herein, the
Company agrees to issue and sell to the Underwriters, and each Underwriter
agrees, severally and not jointly, to purchase from the Company the aggregate
number of Firm Shares set forth opposite the name of such Underwriter on
Schedule A hereto, subject to adjustment in accordance with Section 7 hereof, at
a purchase price of $[ ] per share. The initial public offering price of the
Shares is not in excess of the price recommended by ▇▇ ▇▇▇▇▇ & Co., LLC, acting
in its capacity as a "qualified independent underwriter" within the meaning of
Rule 2720 ("RULE 2720") of the Rules of Conduct of the National Association of
Securities Dealers, Inc. (the "QIU"). The Company is advised by you that the
Underwriters intend (i) to make a public offering of their respective portions
of the Firm Shares as soon after the date hereof as in your judgment is
advisable and (ii) initially to offer the Firm Shares upon the terms set forth
in the Prospectus. You may from time to time increase or decrease the public
offering price after the initial public offering to such extent as you may
determine; provided that, in the event the public offering price is increased,
such public offering price is not in excess of the price recommended by the QIU.
In addition, the Company hereby grants to the several Underwriters the
option to purchase, and upon the basis of the representations, warranties and
covenants, and subject to the terms and conditions herein set forth, the
Underwriters shall have the right to purchase, severally and not jointly, from
the Company, ratably in accordance with the number of Firm Shares to be
purchased by each of them, all or a portion of the Additional Shares as may be
necessary to cover over-allotments made in connection with the offering of the
Firm Shares, at the same purchase price per share to be paid by the Underwriters
to the Company for the Firm Shares. This option may be exercised by the
Representatives together, on behalf of the several Underwriters at any time and
from time to time on or before the thirtieth day following the date hereof, by
written notice to the Company. Such notice shall set forth the aggregate number
of Additional Shares as to which the option is being exercised, and the date and
time when the Additional Shares are to be delivered (such date and time being
herein referred to as the "additional time of purchase"); provided, however,
that the additional time of purchase shall not be earlier than the time of
purchase (as defined below) nor earlier than the second business day after the
date on which the option shall have been exercised nor later than the tenth
business day after the date on which the option shall have been exercised. The
number of Additional Shares to be sold to each Underwriter shall be the number
which bears the same proportion to the aggregate number of Additional Shares
being purchased as the number of Firm Shares set forth opposite the name of such
Underwriter on Schedule A hereto bears to the total number of Firm
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Shares (subject, in each case, to such adjustment as you may determine to
eliminate fractional shares), subject to adjustment in accordance with Section 7
hereof.
2. DELIVERY AND PAYMENT.
(a) Delivery of the documents described in Section 6 hereof with respect
to the purchase of the Shares shall be made at the offices of ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
LLP, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ or such other location as may be
mutually acceptable, at 9:00 A.M., New York City time, on the date of the
closing of the purchase of the Firm Shares or the Additional Shares, as the case
may be.
(b) Payment of the purchase price for the Firm Shares shall be made to the
Company by Federal Funds wire transfer, against delivery of the certificates for
the Firm Shares to you through the facilities of The Depository Trust Company
("DTC") for the respective accounts of the Underwriters. Such delivery and
payment shall be made at 9:00 A.M., New York City time, on March [ ], 2005 (or
at such other time on the same date or such other date as agreed upon by you and
the Company in writing or unless postponed in accordance with the provisions of
Section 7 hereof). The time at which such delivery and payment are to be made is
hereinafter sometimes called "the time of purchase." Electronic transfer of the
Firm Shares shall be made to you at the time of purchase in such names and in
such denominations as you shall specify.
(c) Payment of the purchase price for the Additional Shares shall be made
at the additional time of purchase in the same manner and at the same office as
the payment for the Firm Shares. Electronic transfer of the Additional Shares
shall be made to you at the additional time of purchase in such names and in
such denominations as you shall specify.
3. AGREEMENTS OF THE COMPANY.
The Company hereby agrees with the Underwriters and the QIU as follows:
(a) To file the Prospectus pursuant to Rule 424(b) under the Act not later
than the Commission's close of business on the second business day following the
date of determination of the offering price of the Securities or, if applicable,
such earlier time as may be required by Rule 424(b).
(b) To advise the Representatives promptly and, if requested by the
Representatives, confirm such advice in writing, (i) of the issuance by any
state securities commission of any stop order suspending the qualification or
exemption from qualification of the Shares for offering or sale in any
jurisdiction designated by the Representatives pursuant to Section 3(h) hereof,
or the initiation of any proceeding by any state securities commission or any
other federal or state regulatory authority for such purpose, and (ii) of the
happening of any event during the period referred to in Section 3(f) below that
makes any statement of a material fact made in the Registration Statement or the
Prospectus untrue or that requires any additions to or changes in the
Registration Statement or the Prospectus in order to make the statements therein
not misleading. The Company shall use its best efforts to prevent the issuance
of any stop order or order suspending the qualification or exemption of the
Shares under any state securities or
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Blue Sky laws and, if at any time any state securities commission or other
federal or state regulatory authority shall issue an order suspending the
qualification or exemption of the Shares under any state securities or Blue Sky
laws, the Company shall use its best efforts to obtain the withdrawal or lifting
of such order at the earliest possible time.
(c) To furnish the Underwriters, and those persons identified by the
Underwriters to the Company, as many copies of the Prospectus, and any
amendments or supplements thereto, as the Underwriters may from time to time
reasonably request for the time period specified in Section 3(f); in case any
Underwriter is required to deliver a prospectus after the nine-month period
referred to in Section 10(a)(3) of the Act in connection with the sale of the
Shares, the Company will prepare, at its expense, promptly upon request such
amendment or amendments to the Registration Statement and the Prospectus as may
be necessary to permit compliance with the requirements of Section 10(a)(3) of
the Act. The Company consents to the use of the Prospectus, and any amendments
and supplements thereto required pursuant hereto, by the Underwriters in
connection with the offering and sale of the Shares.
(d) If it is necessary for any post-effective amendment to the
Registration Statement to be declared effective before the offering of the
Shares may commence, the Company will endeavor to cause such post-effective
amendment to become effective as soon as possible and the Company will advise
you promptly and, if requested by you, will confirm such advice in writing, when
such post-effective amendment to the Registration Statement has become
effective.
(e) To advise you promptly and, if requested by you, confirm such advice
in writing, of any request by the Commission for amendments or supplements to
the Registration Statement or the Prospectus or for additional information with
respect thereto, or of notice of institution of proceedings for, or the entry of
a stop order, suspending the effectiveness of the Registration Statement and, if
the Commission should enter a stop order suspending the effectiveness of the
Registration Statement, to use its best efforts to obtain the lifting or removal
of such order as soon as possible.
(f) During such period as a prospectus is required to be delivered under
the Act in connection with the offering and sale of the Shares by the
Underwriters, (i) to advise you promptly and, if requested by you, to confirm
such advice in writing, of any proposal to amend or supplement the Registration
Statement or the Prospectus, including by filing any documents that would be
incorporated therein by reference, and to provide you and Underwriters' counsel
copies of any such documents for review and comment a reasonable amount of time
prior to any proposed filing and to file no such amendment or supplement to
which you shall reasonably object in writing and (ii) to prepare promptly upon
the reasonable request of any of the Representatives, any amendment or
supplement to the Registration Statement or the Prospectus which in the
reasonable opinion of the counsel for the Underwriters is believed to be
necessary under the Act.
(g) To advise you promptly, during the period referred to in Section 3(f)
above, if any event shall occur or condition shall exist as a result of which,
it becomes necessary to amend or supplement the Registration Statement or the
Prospectus in order to make the statements therein, in the light of the
circumstances under which they were made, not
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misleading, or, if it is necessary to amend or supplement the Registration
Statement or the Prospectus to comply with the Act, and forthwith to prepare and
file with the Commission an appropriate amendment or supplement to such
Registration Statement or Prospectus so that the statements therein, as so
amended or supplemented, will not, in the light of the circumstances when it is
so delivered, be misleading, or so that such Registration Statement or
Prospectus will comply with applicable law, and to furnish to the Underwriters
and such other persons as the Underwriters may designate such number of copies
thereof as the Underwriters may reasonably request.
(h) Prior to the sale of the Shares as contemplated hereby, to cooperate
with the Underwriters and counsel to the Underwriters in connection with the
registration or qualification of the Shares for offer and sale to the
Underwriters under the securities or Blue Sky laws of such jurisdictions as the
Representatives may request and to continue such registration or qualification
in effect so long as required and to file such consents to service of process or
other documents as may be necessary in order to effect such registration or
qualification; provided, however, that the Company shall not be required in
connection therewith to qualify as a foreign corporation in any jurisdiction in
which it is not now so qualified or to take any action that would subject it to
general consent to service of process or taxation other than as to matters and
transactions relating to the offering and sale of the Shares, in any
jurisdiction in which it is not now so subject.
(i) Subject to Section 3(f) hereof, to file promptly all reports and any
definitive proxy or information statement required to be filed by the Company
with the Commission in order to comply with the Exchange Act subsequent to the
date of the Prospectus and for so long as the delivery of a prospectus is
required in connection with the offering or sale of the Shares.
(j) If necessary or appropriate, to file a registration statement pursuant
to Rule 462(b) under the Act.
(k) To make generally available to its security holders, and to deliver to
you, an earnings statement of the Company (which will satisfy the provisions of
Section 11(a) of the Act) covering a period of twelve months beginning after the
effective date of the Registration Statement (as defined in Rule 158(c) of the
Act) as soon as is reasonably practicable after the termination of such
twelve-month period.
(l) To furnish to its shareholders as soon as practicable after the end of
each fiscal year an annual report (including a consolidated balance sheet and
statements of income, shareholders' equity and cash flow of the Company and its
subsidiaries for such fiscal year, accompanied by a copy of the certificate or
report thereon of nationally recognized independent certified public
accountants).
(m) If requested by you, to furnish to you one copy of the Registration
Statement, as initially filed with the Commission, and of all amendments thereto
(including all exhibits thereto and documents incorporated by reference therein)
and sufficient copies of the foregoing (other than exhibits) for distribution of
a copy to each of the other Underwriters.
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(n) To the extent not otherwise available on ▇▇▇▇▇ (as defined in
Regulation S-T), to furnish to you promptly and, upon request, to each of the
other Underwriters (i) for a period of five years from the date of this
Agreement (x) copies of any reports or other communications which the Company
shall send to its stockholders or shall from time to time publish or publicly
disseminate, (y) copies of all annual, quarterly and current reports filed with
the Commission on Forms 10-K, 10-Q and 8-K, or such other similar forms as may
be designated by the Commission and (z) copies of documents or reports filed
with any national securities exchange on which any class of securities of the
Company is listed and (ii) for the period referenced in Section 3(f) above, such
other information as you may reasonably request regarding the Company or it
subsidiaries.
(o) To apply the net proceeds from the sale of the Shares in the manner
set forth under the caption "Use of Proceeds" in the Prospectus.
(p) Whether or not the transactions contemplated in this Agreement are
consummated or this Agreement is terminated, to pay or cause to be paid all
expenses incident to the performance of the obligations of the Company under
this Agreement, including: (i) the fees, disbursements and expenses of counsel
to the Company and accountants of the Company in connection with the sale and
delivery of the Shares to the Underwriters and all other fees and expenses in
connection with the preparation, printing, filing and distribution of the
Registration Statement, the Preliminary Prospectus, the Prospectus, and all
amendments and supplements to any of the foregoing (including financial
statements), including the mailing and delivering of copies thereof to the
Underwriters and persons designated by it in the quantities specified herein,
(ii) all costs and expenses related to the transfer and delivery of the Shares
to the Underwriters, including any transfer or other taxes payable thereon,
(iii) all costs of printing or producing this Agreement and any other agreements
or documents in connection with the offering, purchase, sale or delivery of the
Shares, (iv) all expenses in connection with the registration or qualification
of the Shares for offer and sale under the securities or Blue Sky laws of the
several states and all costs of printing or producing any Blue Sky memoranda in
connection therewith (including the filing fees and reasonable fees and
disbursements of counsel for the Underwriters in connection with such
registration or qualification and memoranda relating thereto), (v) the cost of
printing certificates representing the Shares, (vi) all expenses and listing
fees in connection with the listing of the Shares and the Common Stock Shares on
any securities exchange or qualification of the Shares and the Common Stock
Shares for listing on the New York Stock Exchange and any registration thereof
under the Exchange Act, (vii) the expenses (including reasonable related fees
and disbursements of its external counsel) of the QIU incurred by the QIU in its
capacity as a "qualified independent underwriter" within the meaning of Rule
2720 of the Rules of Conduct of the National Association of Securities Dealers,
Inc. with respect to the offering of the Shares, (viii) the costs and charges of
any transfer agent, paying agent, registrar and/or depositary (including DTC),
and (ix) all other costs and expenses incident to the performance of the
obligations of the Company hereunder for which provision is not otherwise made
in this Section. It is understood, however, that, except as specifically
provided in this Section, and Sections 5 and 9 hereof, the Underwriters will pay
all of their own costs and expenses, including the fees of their counsel,
transfer taxes on resale of any of the Shares by them and any advertising
expenses connected with any offers they may make.
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(q) Not to sell, offer to sell, contract or agree to sell, hypothecate,
pledge, grant any option to purchase or otherwise dispose of or agree to dispose
of, directly or indirectly, any Common Stock or securities convertible into or
exchangeable or exercisable for Common Stock or warrants or other rights to
purchase Common Stock or any other securities of the Company that are
substantially similar to Common Stock, or file or cause to be declared effective
a registration statement under the Act relating to the offer and sale of any
shares of Common Stock or securities convertible into or exercisable or
exchangeable for Common Stock or other rights to purchase Common Stock or any
other securities of the Company that are substantially similar to Common Stock
for a period of 90 days after the date hereof (the "LOCK-UP PERIOD"), without
the prior written consent of the Representatives, except for (i) the
registration of the Shares and the sales to the Underwriters pursuant to this
Agreement, (ii) issuances of Common Stock (x) upon the exercise of outstanding
options or warrants or pursuant to existing compensation plans, in each case, as
described in the Registration Statement and the Prospectus and (y) upon the
optional conversion by a holder of Series C senior mandatory convertible
preferred stock or 4-1/4% senior subordinated convertible debentures due 2034,
(iii) the issuance of employee stock options not exercisable during the Lock-Up
Period pursuant to stock option plans described in the Registration Statement
and the Prospectus, (iv) the registration of or sale to the Underwriters of
shares of Common Stock pursuant to the proposed underwriting agreement (the
"COMMON STOCK UNDERWRITING AGREEMENT") to be entered into by the Company,
Citigroup and UBS Securities LLC, as representatives of the several underwriters
named therein (for purposes of this clause (iv) only, "Common Stock" and
"Underwriters" are used as defined in the Common Stock Underwriting Agreement),
(v) issuances of Common Stock to non-employee directors in an aggregate amount
not to exceed $1,000,000 for all such issuances pursuant to this clause (v), so
long as such non-employee director shall be restricted from transferring any
shares of such Common Stock until the expiration of the 90-day period described
in this paragraph, and (vi) any issuance of Common Stock in connection with a
bona fide acquisition of assets or an entity, in each case, useful in the
business of the Company and its subsidiaries, not to exceed $60 million in the
aggregate (valued at the time of issuance) for all such issuances pursuant to
this clause (vi), so long as any transferee or recipient of such shares of
Common Stock shall be restricted from transferring any shares of such Common
Stock until the expiration of the 90-day period described in this paragraph.
Notwithstanding the foregoing, if (1) during the last 17 days of the 90-day
restricted period the Company issues an earnings release or material news or a
material event relating to the Company occurs; or (2) prior to the expiration of
the 90-day restricted period, the Company announces that it will release
earnings results during the 16-day period beginning on the last day of the
90-day period, the restrictions imposed by this paragraph shall continue to
apply until the expiration of the 18-day period beginning on the issuance of the
earnings release or the occurrence of the material news or material event.
(r) To use its best efforts to cause the Shares and the Common Stock
Shares to be listed on the New York Stock Exchange.
(s) To maintain a transfer agent and paying agent and, if necessary under
the jurisdiction of incorporation of the Company, a registrar for the Preferred
Stock.
(t) At any time that the number of authorized but unissued shares of
Common Stock (or shares of Common Stock held in treasury and available for such
purpose) shall be less than the aggregate number of shares of Common Stock into
which the Shares then outstanding
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shall be convertible, to take such action as is necessary to increase the number
of shares which the Company is authorized to issue so that the Company will have
sufficient number of shares of Common Stock available for conversion of the
Shares then outstanding.
(u) To use its best efforts to do and perform all things required or
necessary to be done and performed under this Agreement by it prior to the time
of purchase and to satisfy all conditions precedent to the delivery of the
Shares.
4. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY.
As of the date hereof, the Company represents and warrants to, and agrees
with, the Underwriters and the QIU that:
(a) The Registration Statement has been declared effective under the Act;
no stop order of the Commission preventing or suspending the use of the
Preliminary Prospectus or the effectiveness of the Registration Statement has
been issued and no proceedings for such purpose have been instituted or, to the
Company's knowledge after due inquiry, are threatened by the Commission; the
Preliminary Prospectus, at the time of filing thereof, complied in all material
respects to the requirements of the Act; the Registration Statement complied
when it became effective, complies and will comply, at the time of purchase and
any additional time of purchase, in all material respects with the requirements
of the Act and the Prospectus will comply, as of its date and at the time of
purchase and any additional times of purchase, in all material respects with the
requirements of the Act; the conditions to the use of Form S-3 have been
satisfied; the Registration Statement did not when it became effective, does not
and will not, at the time of purchase and any additional time of purchase,
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 and the Prospectus will not, as of its date and at the time of
purchase and any additional time of purchase, 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, in light of the circumstances under
which they were made, not misleading; provided, however, that the Company makes
no warranty or representation with respect to any statement contained in the
Registration Statement or the Prospectus in reliance upon and in conformity with
information concerning an Underwriter and furnished in writing by or on behalf
of such Underwriter through you to the Company expressly for use in the
Registration Statement or the Prospectus; the documents incorporated by
reference in the Preliminary Prospectus, the Registration Statement and the
Prospectus, at the time they became effective or were filed with the Commission,
complied in all material respects with the requirements of the Act or the
Exchange Act as applicable; and the Company has not distributed and will not
distribute any offering material in connection with the offering or sale of the
Shares other than the Registration Statement, the Preliminary Prospectus and the
Prospectus.
(b) Each of the Company and its subsidiaries has been duly incorporated,
is validly existing as a corporation in good standing under the laws of its
jurisdiction of incorporation and has the corporate power and authority to carry
on its business as described in the Registration Statement and the Prospectus
and to own, lease and operate its properties, and each is duly qualified and is
in good standing as a foreign corporation authorized to do business in each
jurisdiction in which the nature of its business or its ownership or leasing of
property
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requires such qualification, except where the failure to be so qualified would
not have a material adverse effect on the business, prospects, financial
condition or results of operations of the Company and its subsidiaries, taken as
a whole (a "MATERIAL ADVERSE EFFECT").
(c) As of the date of this Agreement, the Company has an authorized and
outstanding capitalization as set forth under the heading "Actual" in the
section of the Registration Statement and the Prospectus entitled
"Capitalization" and, as of the time of purchase, the Company shall have an
authorized and outstanding capitalization as set forth under the heading "As
adjusted for this offering" in the section of the Registration Statement and the
Prospectus entitled "Capitalization"; all outstanding shares of capital stock of
the Company have been duly authorized and validly issued and are fully paid,
non-assessable and not subject to any preemptive or similar rights.
(d) The entities listed on Schedule B hereto are the only subsidiaries,
direct or indirect, of the Company. All of the outstanding shares of capital
stock of each of the subsidiaries of the Company have been duly authorized and
validly issued and are fully paid and non-assessable, and are owned by the
Company, directly or indirectly through one or more subsidiaries, free and clear
of any security interest, claim, lien, encumbrance or adverse interest of any
nature (each, a "LIEN"), except for (i) Liens disclosed in the Registration
Statement or the Prospectus and (ii) such other Liens which could not reasonably
be expected to have a Material Adverse Effect.
(e) This Agreement has been duly authorized, executed and delivered by the
Company.
(f) The resolution set forth in the certificate of designation of the
Shares, the form of which is attached hereto as Exhibit A (the "CERTIFICATE OF
DESIGNATION"), has been duly adopted by the Board of Directors of the Company,
has not been modified, amended or revoked, is in full force and effect on the
date hereof and is the only resolution adopted by the Board of Directors of the
Company or any committee thereof relating to the number of authorized shares of
or the rights, powers and preferences, and the qualifications, limitations and
restrictions thereof, of the Shares; the execution of the Certificate of
Designation by the Company and the filing of the Certificate of Designation with
the Secretary of State of the State of Delaware (the "SECRETARY OF STATE") on
behalf of the Company have been duly authorized by the Board of Directors of the
Company.
(g) The Shares have been duly authorized and, when issued and delivered
against payment therefor as provided herein, will have been duly and validly
issued, fully paid and non-assessable and free of statutory and contractual
preemptive rights, resale rights, rights of first refusal and similar rights.
The Certificate of Designation and the capital stock of the Company, including
the Shares and the Common Stock Shares, will conform in all material respects to
the description thereof contained in the Registration Statement and the
Prospectus.
(h) The Common Stock Shares have been duly authorized and validly reserved
for issuance upon conversion of the Preferred Stock and are free of statutory
and contractual preemptive rights, resale rights, rights of first refusal and
similar rights and are sufficient in number to meet current conversion
requirements, and such Common Stock Shares
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when so issued upon such conversion in accordance with the terms of the
Certificate of Designation, will be validly issued and fully paid and
non-assessable.
(i) Neither the Company nor any of its subsidiaries is (x) in violation of
its respective charter or by-laws or (y) in default in the performance of any
obligation, agreement, covenant or condition contained in any indenture, loan
agreement, mortgage, lease or other agreement or instrument to which the Company
or any of its subsidiaries is a party or by which the Company or any of its
subsidiaries or their respective property is bound, which violation or default,
in the case of this clause (y), could reasonably be expected to have a Material
Adverse Effect.
(j) The execution, delivery and performance of this Agreement by the
Company, compliance by the Company with all provisions hereof, the filing of the
Certificate of Designation with the Secretary of State, the issuance and sale of
the Shares, the issuance of the Common Stock Shares and the consummation of the
transactions contemplated hereby and by the Registration Statement and the
Prospectus (including the related financing transactions) will not (i) require
any consent, approval, authorization or other order of, or qualification with,
any court or governmental body or agency (other than registration of the Shares
and the Common Stock Shares under the Act, which has been or will be effected,
and except such as may be required under the securities or Blue Sky laws of the
various states or under the rules and regulations of the NASD), (ii) conflict
with or constitute a breach of any of the terms or provisions of, or a default
under, the charter or by-laws of the Company or any of its subsidiaries, (iii)
conflict with or constitute a breach of any of the terms or provisions of, or a
default under any indenture, loan agreement, mortgage, lease or other agreement
or instrument to which the Company or any of its subsidiaries is a party or by
which the Company or any of its subsidiaries or their respective property is
bound, which violation or default could reasonably be expected to have a
Material Adverse Effect, (iv) violate or conflict with any applicable law or any
rule, regulation, judgment, order or decree of any court or any governmental
body or agency having jurisdiction over the Company, any of its subsidiaries or
their respective property, which violation or conflict could reasonably be
expected to have a Material Adverse Effect, (v) result in the imposition or
creation of (or the obligation to create or impose) a Lien under, any agreement
or instrument to which the Company or any of its subsidiaries is a party or by
which the Company or any of its subsidiaries or their respective property is
bound which Lien could reasonably be expected to have a Material Adverse Effect,
or (vi) result in the termination, suspension or revocation of any Authorization
(as defined below) of the Company or any of its subsidiaries or result in any
other impairment of the rights of the holder of any such Authorization which
termination, suspension or revocation could reasonably be expected to have a
Material Adverse Effect.
(k) Except as set forth in the Registration Statement and the Prospectus,
(i) no person has the right, contractual or otherwise, to cause the Company to
issue or sell to it any shares of Common Stock or shares of any other capital
stock or other equity interests of the Company, (ii) no person has any
preemptive rights, resale rights, rights of first refusal or other rights to
purchase any shares of Common Stock or shares of any other capital stock or
other equity interests of the Company, and (iii) no person has the right to act
as an underwriter or as a financial advisor to the Company in connection with
the offer and sale of the Shares, in the case of each of the foregoing clauses
(i), (ii) and (iii), whether as a result of the filing or effectiveness
10
of the Registration Statement or the sale of the Shares as contemplated thereby
or otherwise; no person has the right, contractual or otherwise, to cause the
Company to register under the Act any shares of Common Stock or shares of any
other capital stock or other equity interests of the Company, or to include any
such shares or interests in the Registration Statement or the offering
contemplated thereby, whether as a result of the filing or effectiveness of the
Registration Statement or the sale of the Shares as contemplated thereby or
otherwise.
(l) Except as set forth in the Registration Statement and the Prospectus,
there are no legal or governmental proceedings pending or threatened to which
the Company or any of its subsidiaries is or could be a party or to which any of
their respective property is or could be subject, which might result, singly or
in the aggregate, in a Material Adverse Effect. All legal or governmental
proceedings, affiliate transactions, off-balance sheet transactions, contracts,
licenses, agreements, leases or documents of a character required to be
described in the Registration Statement or the Prospectus or to be filed as an
exhibit to the Registration Statement have been so described or filed as
required.
(m) Except as set forth in the Registration Statement and the Prospectus,
neither the Company nor any of its subsidiaries has violated any foreign,
federal, state or local law or regulation relating to the protection of human
health and safety, the environment or hazardous or toxic substances or wastes,
pollutants or contaminants ("ENVIRONMENTAL LAWS"), or any provisions of the
Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations
thereunder, except for such violations which, singly or in the aggregate, would
not have a Material Adverse Effect.
(n) There are no costs or liabilities associated with Environmental Laws
(including, without limitation, any capital or operating expenditures required
for clean-up, closure of properties or compliance with Environmental Laws or any
Authorization, any related constraints on operating activities and any potential
liabilities to third parties) which would, singly or in the aggregate, have a
Material Adverse Effect.
(o) Each of the Company and its subsidiaries has such permits, licenses,
consents, exemptions, franchises, authorizations and other approvals (each, an
"AUTHORIZATION") of, and has made all filings with and notices to, all
governmental or regulatory authorities and self-regulatory organizations and all
courts and other tribunals, including without limitation, under any applicable
Environmental Laws, as are necessary to own, lease, license and operate its
respective properties and to conduct its business, except where the failure to
have any such Authorization or to make any such filing or notice would not,
singly or in the aggregate, have a Material Adverse Effect. Each such
Authorization is valid and in full force and effect and each of the Company and
its subsidiaries is in compliance with all the terms and conditions thereof and
with the rules and regulations of the authorities and governing bodies having
jurisdiction with respect thereto; and no event has occurred (including, without
limitation, the receipt of any notice from any authority or governing body)
which allows or, after notice or lapse of time or both, would allow, revocation,
suspension or termination of any such Authorization or results or, after notice
or lapse of time or both, would result in any other impairment of the rights of
the holder of any such Authorization; except where such failure to be valid and
in full force and effect or to be in compliance, the occurrence of any such
event or the presence of any such restriction would not, singly or in the
aggregate, have a Material Adverse Effect.
11
(p) The accountants, PricewaterhouseCoopers LLP, who have certified the
consolidated financial statements and supporting schedules as of December 31,
2004 and December 31, 2003 and for each of the three years in the period ended
December 31, 2004, included and incorporated by reference in the Registration
Statement and the Prospectus, are independent public accountants with respect to
the Company, as required by the Act and the Exchange Act.
(q) The historical financial statements, together with related schedules
and notes forming part of the Registration Statement and the Prospectus (and any
amendment or supplement thereto), present fairly the consolidated financial
position, results of operations and changes in financial position of the Company
and its subsidiaries on the basis stated in the Registration Statement and the
Prospectus at the respective dates or for the respective periods to which they
apply; such statements and related schedules and notes have been prepared in
compliance with the requirements of the Act and in accordance with generally
accepted accounting principles consistently applied throughout the periods
involved, except as disclosed therein; the other financial and statistical
information and data set forth in the Registration Statement and the Prospectus
(and any amendment or supplement thereto) are, in all material respects,
accurately presented and prepared on a basis consistent with such financial
statements and the books and records of the Company; there are no financial
statements that are required to be included in the Registration Statement and
the Prospectus that are not included as required; and the Company and its
subsidiaries do not have any liabilities or obligations, direct or contingent
(including any off-balance sheet obligations) that would result in a Material
Adverse Effect, not disclosed in the Registration Statement and the Prospectus.
(r) The Company is not, and, after giving effect to the offering and sale
of the Shares and the application of the net proceeds thereof as described in
the Prospectus, will not be, an "investment company," as such term is defined in
the Investment Company Act of 1940, as amended.
(s) No "nationally recognized statistical rating organization" as such
term is defined for purposes of Rule 436(g)(2) under the Act has imposed (or has
informed the Company that it is considering imposing) any condition (financial
or otherwise), other than any condition requiring the consummation of the
Refinancing Plan (as described in the Prospectus) or any component thereof, on
the Company's retaining any rating assigned to the Company or any securities of
the Company.
(t) Subsequent to the respective dates as of which information is given in
the Registration Statement and the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement), other than as set
forth in the Registration Statement or the Prospectus, (i) there has not
occurred any material adverse change or any development involving a prospective
material adverse change in the condition, financial or otherwise, or the
earnings, business, management or operations of the Company and its
subsidiaries, taken as a whole, (ii) there has not occurred any transaction
which is material to the Company and its subsidiaries, taken as a whole, (iii)
there has not been any change or any development involving a prospective
material adverse change in the capital stock or in the long-term debt of the
Company or any of its subsidiaries, (iv) there has not been any dividend or
distribution of any
12
kind declared, paid or made on the capital stock of the Company and (v) neither
the Company nor any of its subsidiaries has incurred any material liability or
obligation, direct or contingent.
(u) The Company has obtained for the benefit of the Underwriters the
agreement (a "LOCK-UP AGREEMENT"), in the form previously agreed upon by the
Company and the Representatives, of each of its directors and officers and each
stockholder named in Exhibit B hereto.
(v) The Company and each of its subsidiaries has good and marketable title
to all property (real and personal) described in the Registration Statement and
in the Prospectus as being owned by each of them, free and clear of all Liens,
except for (i) Liens disclosed in the Registration Statement or the Prospectus
and (ii) such other Liens which could not reasonably be expected to have a
Material Adverse Effect; all the material property described in the Registration
Statement and the Prospectus as being held under lease by the Company or a
subsidiary is held thereby under valid, subsisting and enforceable leases with
such exceptions as would not have a Material Adverse Effect.
(w) Neither the Company nor any of its subsidiaries is engaged in any
unfair labor practice; except for matters which would not, individually or in
the aggregate, have a Material Adverse Effect, (i) there is (A) no unfair labor
practice complaint pending or, to the Company's knowledge after due inquiry,
threatened against the Company or any of its subsidiaries before the National
Labor Relations Board, and no grievance or arbitration proceeding arising out of
or under collective bargaining agreements is pending or threatened, (B) no
strike, labor dispute, slowdown or stoppage pending or, to the Company's
knowledge after due inquiry, threatened against the Company or any of its
subsidiaries and (C) no union representation dispute currently existing
concerning the employees of the Company or any of its subsidiaries, and (ii) to
the Company's knowledge after due inquiry, (A) no union organizing activities
are currently taking place concerning the employees of the Company or any of its
subsidiaries and (B) there has been no violation of any federal, state, local or
foreign law relating to discrimination in the hiring, promotion or pay of
employees, any applicable wage or hour laws or any provision of the Employee
Retirement Income Security Act of 1974 ("ERISA") or the rules and regulations
promulgated thereunder concerning the employees of the Company or any of its
subsidiaries.
(x) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurance that (i) transactions are executed in
accordance with management's general or specific authorization; (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain accountability for assets; (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 existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(y) The Company has established and maintains disclosure controls and
procedures (as such term is defined in Rule 13a-14 and 15d-14 under the Exchange
Act); such disclosure controls and procedures are designed to ensure that
material information relating to the Company, including its consolidated
subsidiaries, is made known to the Company's Chief
13
Executive Officer and its Chief Financial Officer by others within those
entities; the Company's auditors and the Audit Committee of the Board of
Directors have been advised of: (i) any significant deficiencies in the design
or operation of internal controls which could adversely affect the Company's
ability to record, process, summarize, and report financial data; and (ii) any
fraud, whether or not material, that involves management or other employees who
have a role in the Company's internal controls; any material weaknesses in
internal controls have been identified for the Company's auditors; and since the
date of the most recent evaluation of such disclosure controls and procedures,
there have been no significant changes in internal controls or in other factors
that could significantly affect internal controls, including any corrective
actions with regard to significant deficiencies and material weaknesses.
(z) 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
that would have a Material Adverse Effect.
(aa) Neither the Company nor any of its subsidiaries nor, to the knowledge
of the Company, any director, officer, agent, employee or affiliate (as defined
in Rule 405 of Regulation C of the Act) 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.
(bb) Neither the Company nor any of its subsidiaries nor, to the Company's
knowledge after due inquiry, any employee or agent of the Company or its
subsidiaries has made any payment of funds of the Company or its subsidiaries or
received or retained any funds in violation of any law, rule or regulation,
which payment, receipt or retention of funds is of a character required to be
disclosed in the Registration Statement or the Prospectus.
(cc) Neither the Company nor any of its subsidiaries nor, to the best
knowledge of the Company, any of their respective directors, officers,
affiliates or controlling persons has taken, directly or indirectly, any action
designed, or which has constituted or might reasonably be expected to cause or
result in, under the Exchange Act or otherwise, the stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the Shares.
(dd) To the Company's knowledge after due inquiry, there are no
affiliations or associations between any member of the NASD and any of the
Company's officers, directors or
14
5% or greater securityholders, except as set forth in the Registration Statement
and the Prospectus.
(ee) Each certificate signed by any officer of the Company and delivered
to the Underwriters or counsel for the Underwriters shall be deemed to be a
representation and warranty by the Company to the Underwriters as to the matters
covered thereby.
(ff) No action has been taken and no law, statute, rule or regulation or
order has been enacted, adopted or issued by any governmental agency or body
which prevents the execution, delivery and performance of this Agreement by the
Company, the filing of the Certificate of Designation with the Secretary of
State or the issuance of the Shares or the Common Stock Shares, or suspends the
sale of the Shares in any jurisdiction referred to in Section 3(h); and no
injunction, restraining order or other order or relief of any nature by a
federal or state court or other tribunal of competent jurisdiction has been
issued with respect to the Company or any of its subsidiaries which would
prevent or suspend the issuance or sale of the Shares or the issuance of the
Common Stock Shares in any jurisdiction referred to in Section 3(h).
The Company acknowledges that the Underwriters and, for purposes of the
opinions to be delivered to the Underwriters pursuant to Section 6 hereof,
counsel to the Company and counsel to the Underwriters, will rely upon the
accuracy and truth of the foregoing representations and hereby consents to such
reliance.
5. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless each Underwriter,
its directors, its officers, affiliates and each person, if any, who controls
such Underwriter within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act, from and against any and all losses, claims, damages,
liabilities and judgments (including, without limitation, any reasonable legal
or other expenses incurred in connection with investigating or defending any
matter, including any action that could give rise to any such losses, claims,
damages, liabilities or judgments) caused by any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement (or
in the Registration Statement as amended by any post-effective amendment thereof
by the Company becoming effective after the date of this Agreement) or in a
Prospectus (the term Prospectus for the purpose of this Section 5 being deemed
to include any Preliminary Prospectus, the Prospectus and the Prospectus as
amended or supplemented by the Company) or caused by any omission or alleged
omission to state a material fact required to be stated in either such
Registration Statement or such Prospectus or necessary to make the statements
therein not misleading, except insofar as such losses, claims, damages,
liabilities or judgments are caused by any such untrue statement or omission or
alleged untrue statement or omission based upon information relating to such
Underwriter furnished in writing to the Company by such Underwriter for use in
such Registration Statement or such Prospectus.
The Company also agrees to indemnify the QIU, its members, affiliates,
directors, its officers and each person, if any, who controls the QIU within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, from and
against any and all losses, claims, damages,
15
expenses, liabilities and judgments (including, without limitation, any
reasonable legal or other expenses incurred in connection with investigating or
defending any matter, including any action, investigation or proceeding that
could give rise to any such losses, claims, damages, expenses, liabilities or
judgments) incurred as a result of the QIU's participation as a "qualified
independent underwriter" within the meaning of Rule 2720 in connection with the
offering of the Shares and will reimburse each such person promptly upon demand
for any legal fees or other expenses reasonably incurred by such person in
connection with investigating, or preparing to defend, or defending against, or
appearing as a third party witness in respect of, or otherwise incurred in
connection with, any such losses, claims, damages, expenses, liabilities,
judgments, actions, investigations or proceedings, as such fees and expenses are
incurred; provided that the foregoing indemnity will not, as to any such person,
apply to losses, claims, damages, liabilities or judgments to the extent they
are found in a final, non-appealable adjudication of a court of competent
jurisdiction to have resulted from such person's willful misconduct or gross
negligence.
(b) The Underwriters, severally and not jointly, agree to indemnify and
hold harmless the Company and its directors and officers who have signed the
Registration Statement and each person, if any, who controls (within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act) the Company, to the
same extent as the foregoing indemnity from the Company to each Underwriter but
only with reference to information relating to such Underwriter furnished in
writing to the Company by such Underwriter expressly for use in the Registration
Statement (or in the Registration Statement as amended by any post-effective
amendment thereof by the Company) or a Prospectus. The Company acknowledges that
the statements set forth in (i) the last paragraph of the cover page of the
Prospectus regarding delivery of the Shares and (ii) under the heading
"Underwriting," (A) the fifth paragraph, with respect to electronic delivery of
prospectus supplements, (B) the first paragraph under the sub-heading
"Commissions and Discounts" and (C) the paragraphs under the sub-heading "Price
Stabilization, Short Positions," in the Prospectus constitute the only
information furnished in writing by or on behalf of the several Underwriters for
inclusion in the Prospectus.
(c) In case any action shall be commenced involving any person in respect
of which indemnity may be sought pursuant to Section 5(a) or 5(b) (the
"INDEMNIFIED PARTY"), the indemnified party shall promptly notify the person
against whom such indemnity may be sought (the "INDEMNIFYING PARTY") in writing
and the indemnifying party shall assume the defense of such action, including
the employment of counsel reasonably satisfactory to the indemnified party and
the payment of all reasonable fees and expenses of such counsel, as incurred
(except that in the case of any action in respect of which indemnity may be
sought pursuant to both Sections 5(a) and 5(b), the Underwriters shall not be
required to assume the defense of such action pursuant to this Section 5(c), but
may employ separate counsel and participate in the defense thereof, but the fees
and expenses of such counsel, except as provided below, shall be at the expense
of the Underwriters). Any indemnified party shall have the right to employ
separate counsel in any such action and participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of the indemnified
party unless (i) the employment of such counsel shall have been specifically
authorized in writing by the indemnifying party, (ii) the indemnifying party
shall have failed to assume the defense of such action or employ counsel
reasonably satisfactory to the indemnified party or (iii) the named parties to
any such action (including any impleaded parties) include both the indemnified
party and the indemnifying party,
16
and the indemnified party shall have been advised by such counsel that there may
be one or more legal defenses available to it which are different from or
additional to those available to the indemnifying party (in which case the
indemnifying party shall not have the right to assume the defense of such action
on behalf of the indemnified party). In any such case, the indemnifying party
shall not, in connection with any one action or separate but substantially
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the fees and expenses of
more than one separate firm of attorneys (in addition to any local counsel) for
all indemnified parties and all such reasonable fees and expenses shall be
reimbursed as they are incurred; provided, however, that if indemnity may be
sought pursuant to the second paragraph of 5(a) above in respect of such
proceeding, then in addition to such separate firm of the Underwriters, their
officers, directors, affiliates and such control persons of the Underwriters,
the indemnifying person shall be liable for the fees and expenses of not more
than one separate firm (in addition to any local counsel) for the QIU, its
members, affiliates and all persons, if any, who control the QIU within the
meaning of either Section 15 of the Act or Section 20 of the Exchange Act. Such
firm shall be designated in writing by the Representatives, in the case of the
parties indemnified pursuant to Section 5(a), and by the Company, in the case of
parties indemnified pursuant to Section 5(b). The indemnifying party shall not
be obligated to indemnify and hold harmless any indemnified party from and
against any and all losses, claims, damages, liabilities and judgments by reason
of any settlement of any action effected without the indemnifying party's
written consent. No indemnifying party shall, without the prior written consent
of the indemnified party, effect any settlement or compromise of, or consent to
the entry of judgment with respect to, any pending or threatened action in
respect of which the indemnified party is or could have been a party and
indemnity or contribution may be or could have been sought hereunder by the
indemnified party, unless such settlement, compromise or judgment (i) includes
an unconditional release of the indemnified party from all liability on claims
that are or could have been the subject matter of such action and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to
act, by or on behalf of the indemnified party.
(d) To the extent the indemnification provided for in this Section 5 is
unavailable to an indemnified party or insufficient in respect of any losses,
claims, damages, liabilities or judgments referred to therein, then each
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities and judgments (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company, on the one hand, and the Underwriters or the QIU, as the case may be,
on the other hand, from the offering of the Shares or (ii) if the allocation
provided by clause 5(d)(i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause 5(d)(i) above but also the relative fault of the Company, on the
one hand, and the Underwriters or the QIU, as the case may be, on the other
hand, in connection with the statements or omissions which resulted in such
losses, claims, damages, liabilities or judgments, as well as any other relevant
equitable considerations. The relative benefits received by the Company, on the
one hand, and the Underwriters or the QIU, as the case may be, on the other
hand, shall be deemed to be in the same proportion as the total net proceeds
from the offering of the Shares (after underwriting discounts and commissions,
but before deducting expenses) received by the Company, and the total
underwriting discounts and commissions received by the Underwriters or the fee,
if any, to be received by the QIU, as the case may be, bear to the aggregate
public
17
offering price of the Shares, in each case as set forth in this Agreement. The
relative fault of the Company, on the one hand, and the Underwriters or the QIU,
as the case may be, on the other hand, shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company, on the one hand, or the Underwriters or the
QIU, as the case may be, on the other hand, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 5(d) were determined by pro
rata allocation even if the Underwriters were treated as one entity for such
purpose or by any other method of allocation which does not take account of the
equitable considerations referred to in the immediately preceding paragraph. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages, liabilities or judgments referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses incurred by such indemnified party in
connection with investigating or defending any matter, including any action,
that could have given rise to such losses, claims, damages, liabilities or
judgments. Notwithstanding the provisions of this Section 5, no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total discounts and commissions received by such Underwriter exceeds the amount
of any damages which such Underwriter has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. Notwithstanding the provisions of this Section 5, the QIU shall not be
required to contribute any amount in excess of the amount by which the total fee
received by the QIU, as described in Section 14(d), exceeds the amount of any
damages which the QIU has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The Underwriters' obligations to contribute
pursuant to this Section 5(d) are several in proportion to their respective
underwriting commitments and not joint.
(e) The remedies provided for in this Section 5 are not exclusive and
shall not limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
6. CONDITIONS OF UNDERWRITER'S OBLIGATIONS.
The obligations of the Underwriters to purchase the Shares under this
Agreement and of the QIU to perform its services as contemplated hereunder are
subject to the satisfaction of each of the following conditions:
(a) All the representations and warranties of the Company contained in
this Agreement shall be true and correct at the time of purchase and, if
applicable, at the additional time of purchase, with the same force and effect
as if made at the time of purchase and, if applicable, at the additional time of
purchase.
18
(b) On or after the date hereof, (i) there shall not have occurred any
downgrading, suspension or withdrawal of, nor shall any notice have been given
of any potential or intended downgrading, suspension or withdrawal of, or of any
review (or of any potential or intended review) for a possible change that does
not indicate the direction of the possible change in, any rating of the Company
or any securities of the Company (including, without limitation, the placing of
any of the foregoing ratings on credit watch with negative or developing
implications or under review with an uncertain direction) by any "nationally
recognized statistical rating organization" as such term is defined for purposes
of Rule 436(g)(2) under the Act and (ii) there shall not have occurred any
change, nor shall any notice have been given of any potential or intended
negative change, in the outlook for any rating of the Company or any securities
of the Company by any such rating organization.
(c) The Prospectus shall have been filed with the Commission pursuant to
Rule 424(b) under the Act in accordance with Section 3(a) of this Agreement and
no amendment or supplement to the Registration Statement or the Prospectus,
including documents deemed to be incorporated by reference therein, shall have
been filed to which you object in writing.
(d) Prior to the time of purchase, and, if applicable, the additional time
of purchase, (i) no stop order with respect to the effectiveness of the
Registration Statement shall have been issued under the Act or proceedings
initiated under Section 8(d) or 8(e) of the Act.
(e) Between the time of execution of this Agreement and the time of
purchase or the additional time of purchase, as the case may be, other than as
set forth in the Registration Statement or the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of this Agreement), (i)
there shall not have occurred any change or any development involving a
prospective change in the condition, financial or otherwise, or the earnings,
business, management or operations of the Company and its subsidiaries, taken as
a whole, (ii) there shall not have been any change or any development involving
a prospective change in the capital stock or in the long-term debt of the
Company or any of its subsidiaries and (iii) neither the Company nor any of its
subsidiaries shall have incurred any liability or obligation, direct or
contingent, the effect of which, in any such case described in clause 6(e)(i),
6(e)(ii) or 6(e)(iii), in your judgment, is material and adverse and, in your
judgment, makes it impracticable to market the Shares on the terms and in the
manner contemplated in the Registration Statement and the Prospectus.
(f) The Underwriters and the QIU shall have received at the time of
purchase and, if applicable, at the additional time of purchase, a certificate
dated the time of purchase or the additional time of purchase, as the case may
be, signed by the Chief Financial Officer and the Treasurer of the Company,
confirming the matters set forth in Sections 6(a) and 6(b) of this Agreement and
stating that (i) they have reviewed the Registration Statement and the
Prospectus and (ii) the Company has complied with all the agreements and
satisfied all of the conditions herein contained and required to be complied
with or satisfied on or prior to the time of purchase or the additional time of
purchase as the case may be.
(g) The Underwriters and the QIU shall have received at the time of
purchase and, if applicable, at the additional time of purchase, an opinion
(satisfactory to the Underwriters and counsel for the Underwriters), dated the
time of purchase or the additional time of purchase,
19
as the case may be, of ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, counsel for the Company, in the
form previously agreed to by ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP and counsel for the
Underwriters and an opinion of ▇▇▇▇▇▇ ▇▇▇▇, Executive Vice President, General
Counsel and Corporate Secretary of the Company, in the form previously agreed to
by the Company and counsel for the Underwriters.
The opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP described in Section 6(g) above shall
be rendered to you at the request of the Company and shall so state therein.
(h) The Underwriters and the QIU shall have received at the time of
purchase and, if applicable, at the additional time of purchase, an opinion,
dated the time of purchase or the additional time of purchase, as the case may
be, of Cravath, Swaine & ▇▇▇▇▇ LLP, counsel for the Underwriters, in form and
substance reasonably satisfactory to the Underwriters.
(i) The Underwriters and the QIU shall have received, at the time this
Agreement is executed and at the time of purchase and, if applicable, the
additional time of purchase, letters dated, respectively, the date hereof, the
time of purchase and, if applicable, the additional time of purchase, in form
and substance satisfactory to the Underwriters from PricewaterhouseCoopers LLP,
independent public accountants, containing the information and statements of the
type ordinarily included in accountants' "comfort letters" to the Underwriters
with respect to the financial statements and certain financial information
contained and incorporated by reference in the Registration Statement and the
Prospectus.
(j) The Shares and the Common Stock Shares shall each have been approved
for listing on the New York Stock Exchange, in each case, subject only to notice
of issuance at or prior to the time of purchase or the additional time of
purchase, as the case may be.
(k) The Underwriters shall have received signed Lock-up Agreements
referred to in Section 4(u) hereof.
(l) The Certificate of Designation shall have been duly filed with the
Secretary of State and shall have become effective under the General Corporation
Law.
(m) The Company shall not have failed at or prior to the time of purchase
or the additional time of purchase, as the case may be, to perform or comply
with any of the agreements herein contained and required to be performed or
complied with by the Company at or prior to the time of purchase or the
additional time of purchase, as the case may be.
7. EFFECTIVENESS OF AGREEMENT AND TERMINATION.
This Agreement shall become effective upon the execution and delivery of
this Agreement by the parties hereto.
The obligations of the several Underwriters hereunder shall be subject to
termination in the absolute discretion of the Representatives if (x) since the
time of the execution of this Agreement or the earlier respective dates as of
which information is given in the Registration Statement and the Prospectus
(exclusive of any amendments or supplements thereto), there has been any
material adverse change or any development involving a prospective material
adverse change in the business, properties, management, financial condition or
results of
20
operation of the Company and its subsidiaries taken as a whole, which would, in
each of the Representatives' judgment, make it impracticable or inadvisable to
proceed with the public offering or the delivery of the Shares on the terms and
in the manner contemplated in the Registration Statement and the Prospectus
(exclusive of any amendments or supplements thereto), or (y) there shall have
occurred: (i) any attack on, outbreak or escalation of hostilities or act of
terrorism involving the United States, any declaration of war by Congress or any
other national or international calamity or emergency if, in each of the
Representatives' judgment, the effect of any such attack, outbreak, escalation,
act, declaration, calamity or emergency makes it impractical or inadvisable to
proceed with the public offering or the delivery of the Shares, (ii) the
suspension or material limitation of trading in securities or other instruments
on the New York Stock Exchange, the American Stock Exchange, the Chicago Board
of Options Exchange, the Chicago Mercantile Exchange, the Chicago Board of Trade
or the Nasdaq National Market or limitation on prices for securities or other
instruments on any such exchange or the Nasdaq National Market, (iii) the
suspension of trading of any securities of the Company on any exchange or in the
over-the-counter market, (iv) the enactment, publication, decree or other
promulgation of any federal or state statute, regulation, rule or order of any
court or other governmental authority which in each of the Representatives'
judgment materially and adversely affects, or will materially and adversely
affect, the business, prospects, financial condition or results of operations of
the Company and its subsidiaries, taken as a whole, (v) the declaration of a
banking moratorium by either federal or New York State authorities, (vi) any
change in United States or international financial, political or economic
conditions or currency exchange rates or exchange controls as would, in each of
the Representatives' judgment, be likely to prejudice materially the success of
the proposed issue, sale or distribution of the Shares, whether in the primary
market or in respect of dealings in the secondary market or (vii) any major
disruption of settlements of securities or clearance services in the United
States.
Subject to Section 6 hereof and the second paragraph of this
Section 7, if any one or more of the Underwriters shall fail or refuse to
purchase the Firm Shares which it or they have agreed to purchase hereunder on
such date and the aggregate number of the Firm Shares which such defaulting
Underwriter or Underwriters, as the case may be, agreed but failed or refused to
purchase is not more than one-tenth of the aggregate number of Firm Shares to be
purchased on such date by all Underwriters, each non-defaulting Underwriter
shall be obligated severally, in the proportion which the number of Firm Shares
set forth opposite its name in Schedule A bears to the aggregate number of Firm
Shares which all the non-defaulting Underwriters have agreed to purchase, or in
such other proportion as you may specify, to purchase the Firm Shares which such
defaulting Underwriter or Underwriters, as the case may be, agreed but failed or
refused to purchase on such date; provided that in no event shall the aggregate
number of Firm Shares which any Underwriter has agreed to purchase pursuant to
Section 1 hereof be increased pursuant to this Section 7 by an amount in excess
of one-ninth of such number of Firm Shares without the written consent of such
Underwriter. If any Underwriter or Underwriters shall fail or refuse to purchase
the Firm Shares and the aggregate number of Firm Shares with respect to which
such default occurs is more than one-tenth of the aggregate number of Firm
Shares to be purchased by all Underwriters and arrangements satisfactory to the
Underwriters and the Company for purchase of such the Firm Shares are not made
within 48 hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Underwriter and the Company. In any
such case which does not result in termination of this Agreement, either you or
the Company shall have the right to postpone the time of purchase, but in no
event for
21
longer than seven days, in order that the required changes, if any, in the
Registration Statement and the Prospectus or any other documents or arrangements
may be effected. Any action taken under this paragraph shall not relieve any
defaulting Underwriter from liability in respect of any default of any such
Underwriter under this Agreement.
The term Underwriter as used in this Agreement shall refer to and
include any Underwriter substituted under this Section 7 with like effect as if
such substituted Underwriter had originally been named in Schedule A.
8. NOTICES.
Notices given pursuant to any provision of this Agreement shall be
addressed as follows: (i) if to the Company, to ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇-▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, (▇▇▇) ▇▇▇-▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇▇▇▇
and (ii) if to the Underwriters, c/o Citigroup Global Markets Inc., ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇.▇. ▇▇▇▇▇, Attention: General Counsel and c/o ▇.▇.
▇▇▇▇▇▇ Securities Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇.▇. ▇▇▇▇▇, Attention:
Syndicate Desk, or in any case to such other address as the person to be
notified may have requested in writing.
9. SURVIVAL OF CERTAIN REPRESENTATIONS AND OBLIGATIONS.
The respective indemnities, contribution agreements, representations
and warranties and agreements of the Company and the Underwriters set forth in
or made pursuant to this Agreement shall remain operative and in full force and
effect, and will survive the issuance and delivery of the Shares, regardless of
(i) any investigation, or statement as to the results thereof, made by or on
behalf of the Underwriters, the officers, directors or affiliates of the
Underwriters, any person who controls the Underwriters within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, or by or on behalf of
the Company, the officers who have signed the Registration Statement, directors
of the Company, or any person who controls the Company within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, (ii) acceptance of the
Shares and payment for them hereunder and (iii) termination of this Agreement.
If for any reason the Shares are not delivered by or on behalf of
the Company as provided herein (other than as a result of any termination of
this Agreement pursuant to Section 7), the Company agrees to reimburse the
Underwriters for all reasonable out-of-pocket expenses (including the reasonable
fees and disbursements of counsel) incurred by them. Notwithstanding any
termination of this Agreement, the Company shall be liable for all expenses
which it has agreed to pay pursuant to Section 3(p) hereof. The Company also
agrees to reimburse the Underwriters and its officers, directors and each
person, if any, who controls the Underwriters within the meaning of Section 15
of the Act or Section 20 of the Exchange Act for any and all reasonable fees and
expenses (including without limitation the reasonable fees and expenses of
counsel) incurred by them in connection with enforcing their rights under this
Agreement (including without limitation its rights under Section 5).
10. SUCCESSORS AND ASSIGNS.
22
Except as otherwise provided, this Agreement has been and is made
solely for the benefit of and shall be binding upon the Company, the
Underwriters, the Underwriters' directors and officers, the QIU, any controlling
persons referred to herein, the directors of the Company and their respective
successors and assigns, all as and to the extent provided in this Agreement, and
no other person shall acquire or have any right under or by virtue of this
Agreement. The term "successors and assigns" shall not include a purchaser of
any of the Shares from the Underwriters merely because of such purchase.
11. GOVERNING LAW.
This Agreement shall be governed and construed in accordance with
the laws of the State of New York.
12. SUBMISSION TO JURISDICTION.
The Company hereby submits to the non-exclusive jurisdiction of any
court of the State of New York located in the City and County of New York or in
the United States District Court for the Southern District of New York with
respect to any claim, counterclaim or dispute of any kind or nature whatsoever
arising out of or in any way relating to this Agreement, directly or indirectly
(a "CLAIM"), which courts shall have jurisdiction over the adjudication of such
matters, and the Company consents to personal service with respect thereto. The
Company hereby consents to personal jurisdiction, service and venue in any court
in which any Claim is brought by any third party against the Representatives,
the other Underwriters or any indemnified party. Each of the Representatives,
the other Underwriters and the Company (on its behalf and, to the extent
permitted by applicable law, on behalf of its stockholders and affiliates)
waives all right to trial by jury in any action, proceeding or counterclaim
(whether based upon contract, tort or otherwise) in any way arising out of or
relating to this Agreement. The Company agrees that a final judgment in any such
action, proceeding or counterclaim brought in any such court shall be conclusive
and binding upon the Company and may be enforced in any other courts to the
jurisdiction of which the Company is or may be subject, by suit upon such
judgment.
13. COUNTERPARTS.
This Agreement may be signed in various counterparts which together
shall constitute one and the same instrument.
14. QUALIFIED INDEPENDENT UNDERWRITER.
(a) The Company hereby confirms its engagement of the services of
the QIU as, and the QIU hereby confirms its agreement with the Company to render
services as, a "qualified independent underwriter" within the meaning of Rule
2720 with respect to the offering and sale of the Shares.
(b) The QIU represents that it constitutes a "qualified
independent underwriter" within the meaning of Rule 2720 with respect to the
offering and sale of the Shares and it has undertaken the legal responsibilities
and liabilities of an underwriter under the Act, specifically including those
inherent to Section 11 thereof.
23
(c) Subject to the provisions of Section 6 hereof, the QIU will
furnish to the Company on the date hereof a letter, dated the date hereof, the
form of which is attached hereto as Exhibit C.
(d) The QIU hereby agrees with the Company and the Underwriters
that, as part of its services hereunder, in the event of any amendment or
supplement to the Prospectus, the QIU will render services as a "qualified
independent underwriter" within the meaning of Rule 2720 with respect to the
offering and sale of the Shares as described in the Prospectus as so amended or
supplemented that are substantially the same as those services being rendered
with respect to the offering and sale of the Shares as described in the
Prospectus (including those described in subsection (b) above).
(e) The Company and the QIU agree that the QIU will provide its \
services in its capacity as QIU hereunder and will receive a fee of $250,000 for
serving as a "qualified independent underwriter" in connection with the offering
of the Shares; provided that such fee shall only be payable upon consummation of
the offering of the Shares as described in this Agreement.
(f) The QIU hereby consents to the references to it as set forth
under the caption "Underwriting" in the Prospectus and in any amendment or
supplement thereto made in accordance with Section 3 hereof.
24
Please confirm that the foregoing correctly sets forth the agreement
among the Company and the Underwriters.
Very truly yours,
ALLIED WASTE INDUSTRIES, INC.
By: ___________________________
[SIGNATURES CONTINUE ON NEXT PAGE]
The foregoing Underwriting Agreement is hereby confirmed and accepted as of the
date first above written by Citigroup Global Markets Inc. and ▇.▇. ▇▇▇▇▇▇
Securities Inc. on behalf of the Underwriters.
CITIGROUP GLOBAL MARKETS iNC.
By:___________________________
Name:
Title:
▇.▇. ▇▇▇▇▇▇ SECURITIES INC.
By:___________________________
Name:
Title:
The foregoing Underwriting Agreement is hereby confirmed and accepted as of the
date first above written by ▇▇ ▇▇▇▇▇ & Co., LLC, solely in its capacity as a
"qualified independent underwriter" within the meaning of Rule 2720 of the Rules
of Conduct of the National Association of Securities Dealers, Inc.
▇▇ ▇▇▇▇▇ & CO., LLC
By:___________________________
Name:
Title:
SCHEDULE A
UNDERWRITERS
Underwriter Number of Firm Shares
----------- ---------------------
Citigroup Global Markets Inc. [ ]
▇.▇. ▇▇▇▇▇▇ Securities Inc. [ ]
Deutsche Bank Securities, Inc. [ ]
UBS Securities LLC [ ]
BNP Paribas Securities Corp. [ ]
Calyon Securities (USA) [ ]
Credit Suisse First Boston LLC [ ]
Scotia Capital [ ]
Banc of America Securities LLC [ ]
Wachovia Capital Markets LLC [ ]
Total.......................................... 2,000,000
SA-1
SCHEDULE B
SUBSIDIARIES
"-" Indicates Equity Interest Only
3003304 Nova Scotia Company
572060 B.C. Ltd.
AAWI, Inc.
Abilene Landfill TX, LP
Action Disposal, Inc.
▇▇▇▇▇▇ Landfill, Inc.
ADS of Illinois, Inc.
ADS, Inc.
Agri-tech, Inc. of Oregon
Alabama Recycling Services, Inc.
Alaska Street Associates, Inc.
Albany-Lebanon Sanitation, Inc.
Allied Acquisition Pennsylvania, Inc.
Allied Acquisition Two, Inc.
Allied Enviro Engineering, Inc. (TX corp.)
Allied Enviroengineering, Inc. (DE corp.)
Allied Gas Recovery Systems, L.L.C.
Allied Nova Scotia, Inc.
Allied Services, LLC
Allied Transfer Systems of New Jersey, LLC
Allied Waste Alabama, Inc.
Allied Waste Company, Inc.
Allied Waste Hauling of Georgia, Inc.
Allied Waste Holdings (Canada) Ltd.
Allied Waste Industries (Arizona), Inc.
Allied Waste Industries (New Mexico), Inc.
Allied Waste Industries (Southwest), Inc.
Allied Waste Industries of Georgia, Inc.
Allied Waste Industries of Illinois, Inc.
Allied Waste Industries of Northwest Indiana, Inc.
Allied Waste Industries of Tennessee, Inc.
Allied Waste Landfill Holdings, Inc.
Allied Waste North America, Inc. *
Allied Waste of California, Inc.
Allied Waste of Long Island, Inc.
Allied Waste of New Jersey, Inc.
Allied Waste of New Jersey-New York, LLC
Allied Waste Rural Sanitation, Inc.
Allied Waste Services, Inc. (TX corp.)
Allied Waste Sycamore Landfill, LLC
Allied Waste Systems (Texas) Inc.
Allied Waste Systems Holdings, Inc.
Allied Waste Systems of New Jersey, LLC
Allied Waste Systems, Inc. (DE corp.) *
Allied Waste Transportation, Inc. *
American Disposal Services of Illinois, Inc.
American Disposal Services of Kansas, Inc.
American Disposal Services of Missouri, Inc.
American Disposal Services of New Jersey, Inc.
American Disposal Services of West Virginia, Inc.
American Disposal Services, Inc.
American Disposal Transfer Services of Illinois, Inc.
American Materials Recycling Corp.
American Sanitation, Inc.
American Transfer Company, Inc.
▇▇▇▇▇▇▇▇ Regional Landfill, LLC
Anson County Landfill NC, LLC
Apache Junction Landfill Corporation
Arbor Hills Holdings L.L.C. -
Area Disposal Inc.
Atlantic Waste Holding Company, Inc.
Attwoods Holdings GmbH
Attwoods of North America, Inc.
Attwoods Umweltschutz GmbH
Automated Modular Systems, Inc.
Autoshred, Inc.
AWIN Leasing Company, Inc.
AWIN Leasing II, LLC
AWIN Management, Inc.
Belleville Landfill, Inc.
BFGSI Series 1997-A Trust -
BFGSI, LLC -
BFI Argentina, S.A.
BFI Atlantic GmbH
BFI Atlantic, Inc.
BFI Energie Inc.
BFI Energy Systems of Albany, Inc.
BFI Energy Systems of Boston, Inc.
BFI Energy Systems of Delaware County, Inc.
BFI Energy Systems of Essex County, Inc.
BFI Energy Systems of Hempstead, Inc.
BFI Energy Systems of Niagara II, Inc.
BFI Energy Systems of Niagara, Inc.
SB-1
BFI Energy Systems of Plymouth, Inc.
BFI Energy Systems of SEMASS, Inc.
BFI Energy Systems of Southeastern Connecticut, Inc.
BFI Energy Systems of Southeastern Connecticut, L.P.
BFI International, Inc.
BFI of ▇▇▇▇▇, Inc.
BFI Ref-Fuel, Inc.
BFI Services Group, Inc.
BFI Trans River (GP), Inc.
BFI Trans River (LP), Inc.
BFI Transfer Systems of Alabama, LLC
BFI Transfer Systems of DC, LLC
BFI Transfer Systems of Georgia, LLC
BFI Transfer Systems of Maryland, LLC
BFI Transfer Systems of Massachusetts, LLC
BFI Transfer Systems of Mississippi, LLC
BFI Transfer Systems of New Jersey, Inc.
BFI Transfer Systems of Pennsylvania, LLC
BFI Transfer Systems of Texas, LP
BFI Transfer Systems of Virginia, LLC
BFI Waste Services of Indiana, LP
BFI Waste Services of Massachusetts, LLC
BFI Waste Services of Pennsylvania, LLC
BFI Waste Services of Tennessee, LLC
BFI Waste Services of Texas, LP
BFI Waste Services, LLC
BFI Waste Systems of Alabama, LLC
BFI Waste Systems of Arkansas, LLC
BFI Waste Systems of Georgia, LLC
BFI Waste Systems of Indiana, LP
BFI Waste Systems of Kentucky, LLC
BFI Waste Systems of Louisiana, LLC
BFI Waste Systems of Massachusetts, LLC
BFI Waste Systems of Mississippi, LLC
BFI Waste Systems of Missouri, LLC
BFI Waste Systems of New Jersey, Inc.
BFI Waste Systems of North America, Inc.
BFI Waste Systems of North Carolina, LLC
BFI Waste Systems of Oklahoma, LLC
BFI Waste Systems of Pennsylvania, LLC
BFI Waste Systems of South Carolina, LLC
BFI Waste Systems of Tennessee, LLC
BFI Waste Systems of Texas, LP
BFI Waste Systems of Virginia, LLC
Bio-Med of Oregon, Inc.
Blue Ridge Landfill General Partnership
▇▇▇▇▇▇▇ Landfill, Inc.
Brenham Total Roll-Offs, LP
Brickyard Disposal & Recycling, Inc.
Bridgeton Landfill, LLC
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Financial Services, Inc.
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Industries Argentina, ▇.▇.
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Industries Asia Pacific, Inc.
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Industries Chemical Services, Inc.
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Industries de Mexico, S.A. de ▇.▇.
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Industries Europe, Inc.
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Industries Ltd.
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Industries of California, Inc.
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Industries of Florida, Inc.
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Industries of Illinois, Inc.
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Industries of New Jersey, Inc.
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Industries of New York, Inc.
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Industries of Ohio, Inc.
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Industries of Puerto Rico, Inc.
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Industries of Tennessee, Inc.
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Industries, Inc. (DE) *
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Industries, Inc. (MA)
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Services, Inc.
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇, Inc.
▇▇▇▇▇▇▇▇▇ Landfill, LLC
Brunswick Waste Management Facility, LLC
▇▇▇▇▇▇▇ Trash Service, Inc.
▇▇▇▇▇▇ County Landfill, LLC
▇.▇. ▇▇▇▇▇ & Sons, Inc.
Camelot Landfill TX, LP
Capitol Recycling and Disposal, Inc.
CC Landfill, Inc.
CCAI, Inc.
CDF Consolidated Corporation
CECOS International, Inc.
Celina Landfill, Inc.
Central Sanitary Landfill, Inc.
▇▇▇▇▇▇▇▇ Development of North Carolina, Inc.
Champion Recycling, Inc.
Charter Evaporation Resource Recovery Systems
Cherokee Run Landfill, Inc.
Chestnut Equipment Leasing Corp.
▇▇▇▇▇▇▇ Landfill, LLC
Citizens Disposal, Inc.
City Garbage, Inc.
City-Star Services, Inc.
Clarkston Disposal, Inc.
Cocopah Landfill, Inc.
Commercial Reassurance Limited
Congress Development Co. -
Consolidated Processing, Inc.
Containerized, Inc. of Texas
SB-2
Copper Mountain Landfill, Inc.
Corvallis Disposal Co.
County Disposal (Ohio), Inc.
County Disposal, Inc.
County Landfill, Inc.
County Line Landfill Partnership
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Landfill, LLC
Crow Landfill TX L.P.
D & D Garage Services, Inc.
D & L Disposal L.L.C.
Dallas Disposal Co.
Delta Container Corporation
Delta Dade Recycling Corp.
Delta Paper Stock, Co.
Delta Recycling Corp.
Delta Resources Corp.
Delta Site Development Corp.
Delta Tall Pines Corp.
Delta Transfer Corp.
Delta Waste Corp.
▇▇▇▇▇▇▇ Waste Systems II, Inc.
Denver RL North, Inc.
▇▇▇▇▇▇▇▇, Inc.
▇▇▇▇▇▇▇ Industries, Inc.
DTC Management, Inc.
E Leasing Company, LLC
Eagle Industries Leasing, Inc.
Eastern Disposal, Inc.
ECDC Environmental of Humbolt County, Inc.
ECDC Environmental, L.C.
ECDC Holdings, Inc.
ECDC Logistics, LLC
Ecosort, L.L.C. -
Elder Creek Transfer & Recovery, Inc.
▇▇▇▇▇ County Landfill TX, L.P.
▇▇▇▇▇ ▇▇▇▇▇ Landfill MO, LLC
Environmental Development Corp. (DE)
Environmental Development Corp. (P.R.)
Environmental Reclamation Company
Environtech, Inc.
Envotech-Illinois, L.L.C.
EOS Environmental, Inc.
Evergreen Scavenger Service, Inc.
Evergreen Scavenger Service, L.L.C.
F. P. ▇▇▇▇▇▇▇▇ Rubbish Removal, Inc.
Flint Hill Road, LLC
Foothills Sanitary Landfill, Inc. -
Forest View Landfill, LLC
Fort Worth Landfill TX, LP
Forward, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ Trucking Co., Inc.
Frontier Waste Services (Colorado), LLC
Frontier Waste Services (Utah), LLC
Frontier Waste Services of Louisiana, L.L.C.
Frontier Waste Services, L.P.
G. ▇▇▇ ▇▇▇▇▇ Disposal Inc.
Galveston County Landfill TX, ▇▇
▇▇▇▇▇▇▇▇ Brothers, Inc.
▇▇▇▇▇▇▇▇ Recycling and Transfer Station Co., Inc.
Gateway Landfill, LLC
GEK, Inc.
General Refuse Rolloff Corp.
General Refuse Service of Ohio, LLC
Georgia Recycling Services, Inc.
▇▇▇▇▇▇▇▇ Recycling Corp.
Global Indemnity Assurance Company
Golden Triangle Landfill TX, LP
Golden Waste Disposal, Inc.
Grants Pass Sanitation, Inc.
Great Lakes Disposal Services, Inc.
Great Plains Landfill OK, LLC
Green Valley Landfill General Partnership
Greenridge Reclamation, LLC
Greenridge Waste Services, LLC
Greenwood Landfill TX, LP
Gulf West Landfill TX, LP
Gulfcoast Waste Service, Inc.
H Leasing Company, LLC
Harland's Sanitary Landfill, Inc.
Hollister Landfill, Inc.
Houston Towers TX, LP
Illiana Disposal Partnership
Illinois Landfill, Inc.
Illinois Recycling Services, Inc.
Imperial Landfill, Inc.
Independent Trucking Company
▇▇▇▇▇▇ Waste Disposal, Inc.
International Disposal Corp. of California
Itasca Landfill TX, ▇▇
▇▇▇▇▇▇▇ County Landfill, LLC
Jefferson City Landfill, LLC
▇▇▇▇▇▇ Disposal, Inc.
▇▇▇ ▇▇ ▇▇▇▇ & Sons, Inc.
▇▇▇▇▇ Road Landfill and Recycling, Ltd.
Kankeekee RDF Landfill, Inc.
▇▇▇▇▇▇ Canyon Landfill Company
▇▇▇▇▇▇ Drop Box, Inc.
Kent-Meridian Disposal Company -
Kerrville Landfill TX, LP
Key Waste Indiana Partnership
La Canada Disposal Company, Inc.
SB-3
Lake County C & D Development Partnership
Lake ▇▇▇▇▇▇ Landfill, Inc.
▇▇▇▇▇▇▇ Sunrise Sanitation Corporation
▇▇▇ County Landfill SC, LLC
▇▇▇ County Landfill, Inc.
Lemons Landfill, LLC
Lewisville Landfill TX, LP
Liberty Waste Holdings, Inc.
Liberty Waste Services Limited , L.L.C.
Liberty Waste Services of Illinois, L.L.C.
Liberty Waste Services of McCook, L.L.C.
Local Sanitation of Rowan County, L.L.C.
Loop Recycling, Inc.
Loop Transfer, Incorporated
▇▇▇▇▇ ▇▇▇▇▇ & Son, Inc., Sanitation Contractors
Macomb Landfill, Inc.
Mamaroneck Truck Repair, Inc.
Manumit of Florida, Inc.
▇▇▇▇▇▇ Resource Recovery, LLC -
Mars Road TX, ▇▇
▇▇▇▇▇▇▇ Road Landfill TX, ▇▇
▇▇▇▇▇▇▇ Waste Systems, Inc.
Medical Disposal Services, Inc.
Mesa Disposal, Inc.
Mesquite Landfill TX, LP
Metro Enviro Transfer, LLC
Mexia Landfill TX, LP
Minneapolis Refuse, Inc. -
Mirror Nova Scotia Limited
Mississippi Waste Paper Company
MJS Associates, Inc.
▇▇▇▇▇▇▇▇ Landfill General Partnership
Mountain Home Disposal, Inc.
N Leasing Company, LLC
NationsWaste Catawba Regional Landfill, Inc.
NationsWaste, Inc.
Ncorp, Inc.
New ▇▇▇▇▇▇ Landfill Company, Inc.
New York Waste Services, LLC
Newco Waste Systems of New Jersey, Inc.
▇▇▇▇▇▇ County Landfill Partnership
Noble Road Landfill, Inc.
Northeast Landfill, LLC
Northwest Waste Industries, Inc.
Oakland Heights Development, Inc.
Oklahoma City Landfill, LLC
Omaha Hauling Company, Inc.
Omega Holdings GmbH
Organized Sanitary Collectors and Recyclers, Inc.
Oscar's Collection System of Fremont, Inc.
Otay Landfill, Inc.
Ottawa County Landfill, Inc.
Packerton Land Company, LLC
Palomar Transfer Station, Inc.
Panama Road Landfill, TX, L.P.
Paper Fibers, Inc.
Paper Fibres Company
Paper Recycling Systems, Inc.
▇▇▇▇▇▇▇ Real Estate Company
Pinal County Landfill Corp.
Pine Bend Holdings L.L.C. -
Pinecrest Landfill OK, LLC
Pinehill Landfill TX, LP
Pittsburg County Landfill, Inc.
Pleasant Oaks Landfill TX, ▇▇
▇▇▇▇ County Landfill, LLC
Portable Storage, Inc.
▇▇▇▇▇▇ County Landfill, Inc.
Price & Sons Recycling Company
Prime Carting, Inc.
PSI Waste Systems, Inc.
R. 18, Inc.
▇.▇. ▇▇▇▇▇▇ Enterprises, Inc.
▇.▇. ▇▇▇▇▇▇ Refuse Service, Inc.
Rabanco Companies
Rabanco Connections International, Inc.
Rabanco Intermodal/B.C., Inc.
Rabanco Recycling, Inc.
Rabanco Regional Landfill Company
Rabanco, Ltd.
▇▇▇▇▇▇ Landfill, Inc.
RCS, Inc.
Recycle Seattle II
Recycling Associates Inc.
Recycling Industries Corp.
Ref-Fuel Canada Ltd.
Regional Disposal Company
Resource Recovery, Inc.
Rio Grande Valley Landfill TX, LP
Risk Services, Inc.
Roosevelt Associates -
▇▇▇▇ Bros. Waste & Recycling Co.
▇▇▇▇▇▇▇ Sanitary Service, Inc.
▇▇▇▇▇▇ Landfill, Inc.
Royal Holdings, Inc.
Royal Oaks Landfill TX, LP
S & L, Inc.
S & S Recycling, Inc
S Leasing Company, LLC
Saguaro National Insurance Company
Saline County Landfill, Inc.
SB-4
San Marcos NCRRF, Inc.
Sand Valley Holdings, L.L.C.
Sangamon Valley Landfill, Inc.
Sanitary Disposal Service, Inc.
Sauk Trail Development, Inc.
Seattle Disposal Company, Inc.
Selas Enterprises LTD
Show-Me Landfill, LLC
Shred-All Recycling Systems, Inc.
SITA S.A. -
Source Recycling, Inc.
Southeast Landfill, LLC
Southwest Landfill TX, LP
Southwest Regional Landfill, Inc.
Southwest Waste, Inc.
Springfield Environmental General Partnership
SSWI, Inc.
Standard Disposal Services, Inc.
Standard Environmental Services, Inc.
Standard Waste, Inc.
Star Services Group, Inc.
Streator Area Landfill, Inc.
Suburban Carting Corp.
Suburban Transfer, Inc.
Suburban Warehouse, Inc.
Summit Waste Systems, Inc.
Sunrise Sanitation Service, Inc.
Sunset Disposal Service Inc. (CA corp.)
Sunset Disposal, Inc. (KS corp.)
Super Services Waste Management, Inc.
Sycamore Landfill, Inc.
▇▇▇▇'▇ Transfer Systems, Inc.
▇▇▇▇▇▇ Ridge Landfill, Inc.
Tennessee Union County Landfill, Inc.
The Ecology Group, Inc.
▇▇▇ ▇▇▇▇▇▇▇'▇ Disposal Service, Inc.
Total Roll-Offs, LLC
Total Solid Waste Recyclers, Inc.
Tricil (N.Y.), Inc.
Tri-State Recycling Services, Inc.
Tri-State Refuse Corporation
Trottown Transfer, Inc.
Turkey Creek Landfill TX, LP
U.S. Disposal II
United Disposal Service, Inc.
United Waste Control Corp.
Upper Rock Island County Landfill, Inc.
USA Waste of Illinois, Inc.
Usine de Triage Lachenaie Inc.
Valley Landfills, Inc.
VHG, Inc.
Victoria Landfill TX, ▇▇
▇▇▇▇▇▇ Disposal Service, Inc.
▇▇▇▇▇▇ ▇▇▇▇ Development Company
Waste Associates, Inc.
Waste Control Systems, Inc.
Waste Services of New York, Inc.
Wastehaul, Inc.
▇▇▇▇▇ County Landfill IL, Inc.
WDTR, Inc.
Webster Parish Landfill, L.L.C.
Whispering Pines Landfill TX, LP
Willamette Resources, Inc.
▇▇▇▇▇▇▇▇ County Landfill, Inc.
Willow Ridge Landfill, LLC
WJR Environmental, Inc.
Woodlake Sanitary Service, Inc.
SB-5
EXHIBIT A
CERTIFICATE OF DESIGNATION
[To Be Attached]
A-1
EXHIBIT B
DIRECTORS, OFFICERS AND SHAREHOLDERS
SUBJECT TO THE LOCK-UP LETTER AGREEMENT
Directors
- ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
- ▇▇▇▇▇▇ ▇▇▇▇▇
- ▇▇▇▇ ▇. ▇▇▇▇▇
- ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
- ▇▇▇▇▇▇▇ ▇▇▇▇▇
- ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
- ▇. ▇▇▇▇▇▇▇▇▇ Hill
- ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
- ▇▇▇▇▇ ▇▇▇▇▇▇▇
- ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
- ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
- ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Officers
- ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
- ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
- ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
- ▇▇▇▇▇▇ ▇. ▇▇▇▇
- ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
- ▇▇▇▇▇ ▇. ▇▇▇▇
Shareholders
- Apollo Investment Fund III, L.P.
- Apollo Overseas Partners III, L.P.
- Apollo Overseas Partners IV, L.P.
- Apollo (U.K.) Partners III, L.P.
- Apollo/AW LLC
- Blackstone Capital Partners II Merchant Banking Fund L.P.
- Blackstone Capital Partners III Merchant Banking Fund L.P.
- Blackstone Offshore Capital Partners II L.P.
- Blackstone Offshore Capital Partners III L.P.
- Blackstone Family Investment Partnership II L.P.
- Blackstone Family Investment Partnership III L.P.
B-1
EXHIBIT C
▇▇ ▇▇▇▇▇ PRICING LETTER
[▇▇ ▇▇▇▇▇ LETTERHEAD]
, 2005
Allied Waste Industries, Inc.
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ - ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: 2,000,000 shares of [ ]% Series D senior mandatory convertible preferred
stock of Allied Waste Industries, Inc.
Ladies and Gentlemen:
Allied Waste Industries, Inc., a Delaware corporation (the "Company"), has
filed with the Securities and Exchange Commission a registration statement on
Form S-3 (File No. 333-115329) (the "Registration Statement") relating to the
public offering (the "Offering") of 2,000,000 shares of its [ ]% Series D senior
mandatory convertible preferred stock (the "Shares"), for which Citigroup Global
Markets Inc. and ▇.▇. ▇▇▇▇▇▇ Securities Inc. are acting as the representatives
of the underwriters.
We understand that affiliates of certain of the underwriters of the
Offering, each a member of the National Association of Securities Dealers, Inc.
(the "NASD"), may receive in excess of 10% of the net offering proceeds of the
Offering, and are participating in the Offering, as described in Section (h) of
the Conduct Rules ("Rule 2710") of the NASD. As a result, you have asked us to
serve as a "qualified independent underwriter" (as such term is defined in NASD
Rule 2720), as required by Section (h) of Rule 2710, and, in such capacity, to
recommend to you the maximum price at which the Shares are to be sold to the
public.
We have reviewed the Registration Statement and the prospectus included
therein, and we have participated in the preparation of the prospectus
supplement and have exercised the usual standards of due diligence in respect
thereto. Based upon the foregoing and assuming that the Offering of the Shares
is made as of March 3, 2005, we recommend that (i) the Shares be offered to the
public at a price no higher than $250.00 per share, (ii) the yield on the Shares
shall not be less than [ ]% and (iii) the conversion premium on the Shares shall
not be greater than [ ]%. Such recommendation should in no way be considered or
relied upon as an indication of the actual value of the Shares.
C-1
In the course of our examination for purposes of recommending a maximum
price, minimum yield and maximum conversion premium for the Shares, we have
relied upon and assumed, without independent verification, the accuracy and
completeness of all documents and other information concerning the Company and
its predecessors provided to us by the Company and its representatives, and the
assurance of management of the Company that they are unaware of any facts which
would make the information provided to us incomplete or misleading. In arriving
at our recommendation, we have not performed an independent appraisal or
valuation of any properties or any other assets of the Company. Changes in the
condition and circumstances of the Company from that described in such
Registration Statement, prospectus and prospectus supplement and events
occurring after the date hereof, including changes in the markets in which the
Company operates, could materially affect the conclusions stated in this letter.
We shall not be obligated or required hereafter to reaffirm or revise our
recommendation or otherwise to comment on any events occurring after the date
hereof or on any changes to the conditions or circumstances of the Company from
those so described.
This letter is rendered only to the Company and is solely for its benefit
in connection with the Offering contemplated hereby. This letter may not be
relied upon for any other purpose, or furnished to, quoted to, or relied upon by
any other person, firm or corporation for any purpose, without our prior written
consent, except that it may be furnished to the NASD in connection with its
review of the Offering.
[Signature on following page]
C-2
Very truly yours,
▇▇ ▇▇▇▇▇ & CO., LLC
By: _________________________
Name:
Title:
C-3