EXHIBIT 10.1
CORRECTIONS CORPORATION OF AMERICA
$150,000,000 6.75% SENIOR NOTES DUE 2014
UNDERWRITING AGREEMENT
dated January 18, ▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ SECURITIES LLC
▇▇▇▇▇▇ BROTHERS INC.
WACHOVIA CAPITAL MARKETS, LLC
UNDERWRITING AGREEMENT
January 18, ▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ SECURITIES LLC
▇▇▇▇▇▇ BROTHERS INC.
WACHOVIA CAPITAL MARKETS, LLC
As Representatives of the several Underwriters
c/o BANC OF AMERICA SECURITIES LLC
▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
HSBC Securities (USA) Inc.
As Qualified Independent Underwriter
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Introductory. Corrections Corporation of America, a Maryland
corporation (the "Company"), proposes to issue and sell to the several
underwriters named in Schedule A (the "Underwriters") an aggregate of
$150,000,000 in principal amount of its 6.75% Senior Notes due 2014 (the
"Notes"), subject to the terms and conditions set forth in this Underwriting
Agreement (this "Agreement"). Banc of America Securities LLC ("BAS"), ▇▇▇▇▇▇
Brothers Inc. and Wachovia Capital Markets, LLC have agreed to act as
representatives of the several Underwriters (in such capacity, the
"Representatives") in connection with the offering and sale of the Notes. The
Notes will be guaranteed (collectively, the "Guarantees") by each of the
subsidiary guarantors named in Schedule B (the "Notes Guarantors"). The Notes
and the Guarantees are collectively referred to herein as the "Securities." The
Securities are to be issued pursuant to the provisions of a base indenture to be
dated as of January 23, 2006 (the "Base Indenture") among the Company, the Notes
Guarantors and U.S. Bank National Association, as trustee (the "Trustee"), as
amended and supplemented by a first supplemental indenture to be dated as of
January 23, 2006. The Base Indenture, as supplemented by the first supplemental
indenture, is referred to herein as the "Indenture."
The Company hereby confirms its engagement of HSBC Securities (USA)
Inc. ("HSBC") as, and HSBC hereby confirms its agreement with the Company to
render services as, a "qualified independent underwriter," within the meaning of
Section (b)(15) of Conduct Rule 2720 of the National Association of Securities
Dealers, Inc. (the "NASD") with respect to the offering and sale of the Notes.
HSBC, solely in its capacity as the qualified independent underwriter and not
otherwise, is referred to herein as the "QIU." HSBC will not receive any
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compensation for serving as the QIU. The yield at which the Notes will be
distributed to the public shall not be lower than that recommended by the QIU.
SECTION 1. Representations and Warranties of the Company and the Notes
Guarantors.
The Company and each Notes Guarantor hereby, jointly and severally,
represent, warrant and covenant to each Underwriter as follows:
(a) The Company has prepared and filed with the Securities and Exchange
Commission (the "Commission") an automatic shelf registration statement on Form
S-3 (Registration No. 333-131072), which contains a base prospectus (the "Base
Prospectus"), to be used in connection with the public offering and sale of the
Securities. Such registration statement, as amended, including the financial
statements, exhibits and schedules thereto, in the form in which it was declared
effective or is deemed effective by the Commission for purposes of Section 11 of
the Securities Act of 1933 and the rules and regulations promulgated thereunder
(collectively, the "Securities Act"), including any required information deemed
to be a part thereof at the time of effectiveness pursuant to Rule 430B under
the Securities Act or the Securities Exchange Act of 1934 and the rules and
regulations promulgated thereunder (collectively, the "Exchange Act"), is called
the "Registration Statement." Any preliminary prospectus supplement to the Base
Prospectus that describes the Securities and the offering thereof and is used
prior to filing of the final prospectus relating to the Securities and the
offering thereof is called, together with the Base Prospectus, a "preliminary
prospectus." The term "Prospectus" shall mean the final prospectus relating to
the Securities and the offering thereof that is first filed pursuant to Rule
424(b) after the date and time that this Agreement is executed and delivered by
the parties hereto (the "Execution Time"). Any reference herein to the
Registration Statement, any preliminary prospectus or the Prospectus shall be
deemed to refer to and include the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 under the Securities Act; any reference to any
amendment or supplement to any preliminary prospectus or the Prospectus shall be
deemed to refer to and include any documents filed after the date of such
preliminary prospectus or Prospectus, as the case may be, under the Exchange
Act, and incorporated by reference in such preliminary prospectus or Prospectus,
as the case may be; and any reference to any amendment to the Registration
Statement shall be deemed to refer to and include any annual report of the
Company filed pursuant to Section 13(a) or 15(d) of the Exchange Act after the
effective date of the Registration Statement that is incorporated by reference
in the Registration Statement.
(b) Compliance with Registration Requirements. The Registration
Statement became effective upon filing with the Commission under the Securities
Act. No stop order suspending the effectiveness of the Registration Statement is
in effect and no proceedings for such purpose have been instituted or, to the
knowledge of the Company, are pending or are threatened by the Commission.
Each preliminary prospectus and the Prospectus when filed complied or
will comply in all material respects with the Securities Act and, if filed by
electronic transmission pursuant to the Commission's Electronic Data Gathering,
Analysis and Retrieval System ("▇▇▇▇▇") (except for format and other variations
and except as may be permitted by Regulation S-T under
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the Securities Act), was or will be identical to the copy thereof delivered to
the Underwriters for use in connection with the offer and sale of the
Securities. Each of the Registration Statement and any post-effective amendment
thereto, at the time it became effective and at the date hereof, complied and
will comply in all material respects with the Securities Act and did not and
will not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. The Prospectus, as amended or supplemented, as of its date, at
the time of any filing pursuant to Rule 424(b) under the Securities Act and at
the Closing Date (as defined herein), did not and will not contain any untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements therein, in light of the circumstances under which they
were made, not misleading. The representations and warranties set forth in the
two immediately preceding sentences do not apply to (i) that part of the
Registration Statement which constitutes the Statement of Eligibility and
Qualification ("Form T-1") of the Trustee under the Trust Indenture Act of 1939,
as amended (the "TIA") or (ii) statements in or omissions from the Registration
Statement or any post-effective amendment thereto, or the Prospectus, or any
amendments or supplements thereto, made in reliance upon and in conformity with
information relating to any Underwriter furnished to the Company in writing
through the Representatives by or on behalf of any Underwriter specifically for
use therein, it being understood and agreed that the only such information
furnished by the Representatives consists of the information described as such
in Section 7 hereof. There is no material contract or other material document
required to be described in the Prospectus or to be filed as an exhibit to the
Registration Statement by the Securities Act that has not been described or
filed as required or incorporated therein by reference as permitted by the
Securities Act.
The documents incorporated by reference in the Prospectus, when they
became effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the Securities Act or
the Exchange Act, as applicable. Any further documents so filed and incorporated
by reference in the Prospectus or any further amendment or supplement thereto,
when such documents become effective or are filed with the Commission, as the
case may be, will conform in all material respects to the requirements of the
Securities Act or the Exchange Act, as applicable.
(c) Company is Well-Known Seasoned Issuer. (i) At the time of filing
the Registration Statement, (ii) at the time of the most recent amendment
thereto for the purposes of complying with Section 10(a)(3) of the Securities
Act (whether such amendment was by post-effective amendment, incorporated report
filed pursuant to Section 13 or 15(d) of the Exchange Act or form of
prospectus), (iii) at the time the Company or any person acting on its behalf
(within the meaning, for this clause only, of Rule 163(c) of the Securities Act)
made any offer relating to the Securities in reliance on the exemption of Rule
163 of the Securities Act, and (iv) at the Execution Time (with such date being
used as the determination date for purposes of this clause (iv)), the Company
was and is a "well-known seasoned issuer" as defined in Rule 405 of the
Securities Act. The Registration Statement is an "automatic shelf registration
statement," as defined in Rule 405 of the Securities Act, the Company has not
received from the Commission any notice pursuant to Rule 401(g)(2) of the
Securities Act objecting to use of the automatic shelf registration statement
form and the Company is eligible to use Form S-3 as the form for the
Registration Statement.
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(d) Disclosure Package. The term "Disclosure Package" shall mean (i)
the Base Prospectus as supplemented by the preliminary prospectus supplement
dated January 18, 2006 relating to the Securities and the offering thereof and
filed by the Company with the Commission under Rule 424(b) of the Securities Act
on such date, (ii) the issuer free writing prospectuses as defined in Rule 433
of the Securities Act, if any, identified in Schedule C hereto (each, an "Issuer
Free Writing Prospectus"), (iii) any other free writing prospectus that the
parties hereto shall hereafter mutually expressly agree in writing to treat as
part of the Disclosure Package and (iv) the Final Term Sheet (as defined
herein), which also shall be identified in Schedule C hereto. As of 3:30 pm
(Eastern time) on the date of this Agreement (the "Applicable Time"), the
Disclosure Package did not contain any untrue statement of a material fact or
omit to state any material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. The preceding sentence does not apply to statements in or omissions
from the Disclosure Package based upon and in conformity with written
information furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood and agreed
that the only such information furnished by or on behalf of any Underwriter
consists of the information described as such in Section 7 hereof.
(e) Company Not Ineligible Issuer. (i) At the earliest time after the
filing of the Registration Statement covering the offering of the Securities
that the Company or another offering participant made a bona fide offer (within
the meaning of Rule 164(h)(2) of the Securities Act) and (ii) as of the date of
the execution and delivery of this Agreement (with such date being used as the
determination date for purposes of this clause (ii)), the Company was not and is
not an Ineligible Issuer (as defined in Rule 405 of the Securities Act), without
taking account of any determination by the Commission pursuant to Rule 405 of
the Securities Act that it is not necessary under the circumstances that the
Company be considered an Ineligible Issuer;
(f) Issuer Free Writing Prospectuses. Neither any Issuer Free Writing
Prospectus nor the Final Term Sheet, as of its respective issue date and at all
subsequent times through the completion of the offering of the Securities or
until any earlier date that the Company notified or notifies the Representatives
as described in the next sentence, did not, does not and will not include any
information that conflicted, conflicts or will conflict with (within the meaning
of Rule 433(c) of the Securities Act) the information contained or incorporated
by reference in the Registration Statement that has not been superseded or
modified. If at any time following issuance of an Issuer Free Writing Prospectus
there occurred or occurs an event or development as a result of which such
Issuer Free Writing Prospectus conflicted or would conflict with the information
contained in the Registration Statement, the Company has promptly notified or
will promptly notify the Representatives and has promptly amended or will
promptly amend or supplement, at its own expense, such Issuer Free Writing
Prospectus to eliminate or correct such conflict. The foregoing two sentences do
not apply to statements in or omissions from any Issuer Free Writing Prospectus
based upon and in conformity with written information furnished to the Company
by any Underwriter through the Representatives specifically for use therein, it
being understood and agreed that the only such information furnished by any
Underwriter consists of the information described as such in Section 7 hereof.
(g) Accuracy of Statements in Prospectus. The statements in each of the
Disclosure Package and the Prospectus (or the documents incorporated by
reference therein) under the
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headings "Risk Factors -- We are subject to legal proceedings associated with
owning and managing correctional detention facilities," "Description of Notes,"
"Description of Proposed Credit Facility," "Certain U.S. Federal Income Tax
Considerations" and "ERISA Considerations," and insofar as such statements
purport to describe the provisions of laws, agreements, documents and
proceedings referred to therein, are accurate in all material respects.
(h) Distribution of Offering Material By the Company. The Company has
not distributed and will not distribute, prior to the later of the Closing Date
(as defined below) and the completion of the Underwriters' distribution of the
Securities, any offering material in connection with the offering and sale of
the Securities other than a preliminary prospectus, the Prospectus, any Issuer
Free Writing Prospectus reviewed and consented to in writing by the
Representatives or included in Schedule C hereto or the Registration Statement.
(i) Company and Subsidiaries Not an "Investment Company." Neither the
Company nor any of its subsidiaries is, or after giving effect to the offering
and sale of the Securities and upon application of the net proceeds therefrom as
described under the caption "Use of Proceeds" in each of the preliminary
prospectus and the Prospectus will be, an "investment company" or a company
"controlled" by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
(j) Reporting Company. The Company is subject to Section 13 or 15(d) of
the Exchange Act.
(k) Market and Customer Data. The market-related and customer-related
data and estimates included under the caption "Summary" in each of the
Disclosure Package and the Prospectus are based on or derived from sources which
the Company and the Notes Guarantors believe to be reliable and accurate in all
material respects.
(l) Incorporation and Good Standing of the Company and its
Subsidiaries. The Company and each of its subsidiaries have been duly organized
and are validly existing as corporations, limited liability companies or limited
partnerships in good standing under the laws of their respective jurisdictions
of organization, are duly qualified to do business and are in good standing as
foreign corporations, limited liability companies or limited partnerships in
each jurisdiction in which their respective ownership or lease of property or
the conduct of their respective businesses requires such qualification, except
as would not, individually or in the aggregate, have a material adverse effect
on the consolidated financial position, stockholders' equity, results of
operations, business or prospects of the Company and its subsidiaries, taken as
a whole (a "Material Adverse Effect"), and have all corporate, limited liability
company or limited partnership power and authority, as applicable, necessary to
own or hold their respective properties and to conduct the businesses in which
they are presently engaged and none of the subsidiaries of the Company (other
than CCA of Tennessee, LLC., Prison Realty Management, Inc., CCA Properties of
America LLC, CCA Properties of Texas LP, CCA Western Properties, Inc., CCA
Properties of Arizona LLC, CCA Properties of Tennessee LLC, CCA International,
Inc., Technical and Business Institutes of America, Inc., TransCor America, LLC,
TransCor Puerto Rico, Inc., CCA (UK) Ltd., Vicor Investments PTY. Ltd.
(collectively, the "Significant Subsidiaries")) is a "significant subsidiary,"
as such term is defined in Rule 405 of the Securities Act.
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(m) Capitalization and Other Capital Stock Matters. The Company has an
authorized capitalization as set forth in each of the Disclosure Package and the
Prospectus and all of the issued shares of capital stock of the Company have
been duly and validly authorized and issued, are fully paid and non-assessable
and conform to the description thereof contained in each of the Disclosure
Package and the Prospectus; and all of the issued shares of capital stock of
each subsidiary of the Company have been duly and validly authorized and issued
and are fully paid and non-assessable and are owned directly or indirectly by
the Company, free and clear of all liens, encumbrances, equities or claims
except as set forth in each of the Disclosure Package and the Prospectus.
(n) The Indenture -- Validity. The Company and each Notes Guarantor has
all requisite corporate, limited liability company or limited partnership power
and authority to enter into the Indenture. The Indenture has been duly and
validly authorized by the Company and each Notes Guarantor and, upon its
execution and delivery and, assuming due authorization, execution and delivery
by the Trustee, will constitute the valid and binding agreement of the Company
and each Notes Guarantor, enforceable against the Company and each Notes
Guarantor in accordance with its terms, except as such enforceability may be
limited by bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium, and other laws relating to or affecting creditors' rights generally
and by general equitable principles. The Indenture has been duly qualified under
the TIA and the rules and regulations of the Commission applicable to an
indenture that is qualified thereunder.
(o) The Indenture -- Description. The Indenture will conform to the
description thereof in the Disclosure Package and the Prospectus in all material
respects.
(p) The Notes -- Validity. The Company has all requisite corporate
power and authority to issue and sell the Notes. The Notes have been duly and
validly authorized by the Company and, when duly executed by the Company in
accordance with the terms of the Indenture, assuming due authentication of the
Notes by the Trustee, upon delivery to the Underwriters against payment therefor
in accordance with the terms of this Agreement, will be validly issued and
delivered, and will constitute valid and binding obligations of the Company
entitled to the benefits of the Indenture, enforceable against the Company in
accordance with their terms, except as such enforceability may be limited by
bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and
other laws relating to or affecting creditors' rights generally and by general
equitable principles.
(q) The Notes -- Description. The Notes will conform to the description
thereof in the Disclosure Package and the Prospectus in all material respects.
(r) The Guarantees -- Validity. Each Notes Guarantor has all requisite
corporate, limited liability company or limited partnership power and authority
to issue the Guarantees. The Guarantees have been duly and validly authorized by
each Notes Guarantor and when duly executed and delivered by each Notes
Guarantor in accordance with the terms of the Indenture and upon the due
execution, authentication and delivery of the Notes in accordance with the
Indenture and the issuance of the Notes in the sale to the Underwriters
contemplated by this Agreement, will constitute valid and binding obligations of
each Notes Guarantor, enforceable against each Notes Guarantor in accordance
with their terms, except as such enforceability of the
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Notes Guarantors' obligations thereunder may be limited by bankruptcy,
fraudulent conveyance, insolvency, reorganization, moratorium, and other laws
relating to or affecting creditors' rights generally and by general equitable
principles.
(s) The Guarantees -- Description. The Guarantees will conform to the
description thereof in the Disclosure Package and the Prospectus in all material
respects.
(t) The Underwriting Agreement. The Company and each Notes Guarantor
has all requisite corporate, limited liability company or limited partnership
power and authority to enter into this Agreement. This Agreement has been duly
authorized, executed and delivered by the Company and the Notes Guarantors.
(u) Non-Contravention of Existing Instruments; No Further
Authorizations or Approvals Required. Neither the Company nor any of its
subsidiaries (i) is in violation of its charter or by-laws, (ii) is in default
and no event has occurred which, with notice or lapse of time or both, would
constitute such a default, in the due performance or observance of any term,
covenant or condition contained in any material indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which it is a party or
by which it is bound or to which any of its properties or assets is subject or
(iii) except as described in the Disclosure Package and the Prospectus, is in
violation of any law, ordinance, governmental rule, regulation or court decree
to which it or its property or assets may be subject or has failed to obtain any
material license, permit, certificate, franchise or other governmental
authorization or permit necessary to the ownership of its property or to the
conduct of its business, except, with regard to (ii) and (iii) of this
paragraph, for such defaults, violations or failures that would not reasonably
be expected to have a Material Adverse Effect. The issue and sale of the Notes
and the Guarantees and the execution, delivery and performance of this
Agreement, the Indenture, the Notes, the Guarantees, and compliance by the
Company and the Notes Guarantors with all of the provisions of the Notes, the
Guarantees and the Indenture, by the Company and each of the Notes Guarantors,
as applicable, and this Agreement and the consummation of the transactions
contemplated hereby and thereby and the use of the net proceeds from the sale of
the Notes as described in the Disclosure Package and the Prospectus (i) will not
conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement 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 is bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject, except where such conflict, breach,
violation or default would not have a Material Adverse Effect, (ii) result in
any violation of the provisions of the charter or by-laws of the Company or any
of its subsidiaries or (iii) result in any violation of any statute or any
order, rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
properties or assets, except where such conflict, breach, violation or default
would not have a Material Adverse Effect. Except for the registration of the
Securities under the Securities Act, no consent, approval, authorization or
order of, or filing, registration or qualification with any such court or
governmental agency or body is required for the issue and sale of the Notes and
the Guarantees or the consummation by the Company and the Notes Guarantors of
the transactions contemplated by this Agreement or the Indenture, except where
the failure to receive the required consent, approval, authorization, order,
filing, registration or qualification (other than as may be required under the
federal securities laws)
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would not have a Material Adverse Effect and such consents, approvals,
authorizations, orders, filings, registrations or qualifications as may be
required under state securities or blue sky laws in connection with the purchase
and distribution of the Notes by the Underwriters.
(v) No Applicable Registration or Similar Rights. There are no
contracts, agreements or understanding between the Company, and subsidiary and
any person granting such person the right (other than rights that have been
waived or satisfied) to require the Company or any subsidiary to file a
registration statement under the Securities Act with respect to any securities
of the Company or any subsidiary owned or to be owned by such person or to
require the Company or any subsidiary to have such securities registered for
sale under the Registration Statement or included in the offering contemplated
by this Agreement, except for those registration rights as provided in the
registration rights agreements, dated December 31, 1998, as amended through the
date hereof, by and between the Company and PMI Mezzanine Fund, L.P., and the
registration rights agreement, dated as of December 31, 1998, by and between
Correctional Management Services Corporation, a predecessor of the Company, and
CFE, Inc., in any securities being registered pursuant to any other registration
statement filed by the Company or any Notes Guarantor under the Securities Act.
(w) No loss or change. To our knowledge after reasonable investigation,
neither the Company, the Notes Guarantors nor any of their respective
subsidiaries has sustained, since the date of the latest audited financial
statements included or incorporated by reference in the Disclosure Package and
the Prospectus, any loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, in each case otherwise
than as set forth or contemplated in the Disclosure Package and the Prospectus
and except where such loss or interference would not have a Material Adverse
Effect; and since such date, there has not been any change in the capitalization
or long-term debt of the Company, the Notes Guarantors or any of their
respective subsidiaries or any development in or affecting the general affairs,
management, financial position, stockholders' equity or results of operations of
the Company, the Notes Guarantors or their respective subsidiaries, otherwise
than as set forth or contemplated in the Disclosure Package and the Prospectus
or as would not have a Material Adverse Effect.
(x) Financial Information. The historical consolidated financial
statements (including the related notes and supporting schedules) included or
incorporated by reference in the Prospectus and the Disclosure Package comply in
all material respects with the requirements of Regulation S-X under the
Securities Act applicable to registration statements on Form S-1 under the
Securities Act and present fairly, in all material respects, the consolidated
financial condition and results of operations of the entities purported to be
shown thereby at the dates and for the periods indicated and have been prepared
in all material respects in conformity with U.S. generally accepted accounting
principles applied on a consistent basis throughout the periods presented.
(y) Independent Public Accountants. Ernst & Young LLP, who have
expressed their opinion with respect to the financial statements (which term as
used in this Agreement includes the related notes thereto) filed with the
Commission as a part of the Registration Statement and included in the
Disclosure Package and the Prospectus, are independent public accountants with
respect to the Company as required by the Securities Act and the Exchange Act.
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(z) Title to Properties. Except as otherwise disclosed in the
Disclosure Package and the Prospectus, the Company and each of its subsidiaries
has good and valid title in fee simple to all real property and good and valid
title to all personal property owned by them, in each case free and clear of all
liens, encumbrances and defects except such as do not materially affect the
value of such property and do not materially interfere with the use made of such
property by the Company and each of its subsidiaries; and all real property and
buildings held under lease by the Company and each of its subsidiaries are held
by them under valid, subsisting and enforceable leases, with such exceptions as
are not material and do not interfere with the use made of such property and
buildings by the Company and its subsidiaries.
(aa) Insurance. To their knowledge after reasonable investigation, the
Company and each of its subsidiaries carry, or are covered by, insurance in such
amounts and covering such risks as is adequate for the conduct of their
respective businesses and the value of their respective properties and as is
customary for companies engaged in similar businesses in similar industries.
(bb) Intellectual Property Rights. The Company and each of its
subsidiaries own or possess adequate rights to use all material patents, patent
applications, trademarks, service marks, trade names, trademark registrations,
service ▇▇▇▇ registrations, copyrights and licenses necessary for the conduct of
their respective businesses except where the failure to own or possess such
rights would not result in a Material Adverse Effect, and have no knowledge
after reasonable investigation that the conduct of their respective businesses
will conflict with, and have not received any notice of any claim of conflict
with, any such rights of others, which individually or in the aggregate, would
result in a Material Adverse Effect.
(cc) No Material Actions or Proceedings. Except as otherwise disclosed
in the Disclosure Package, there are no legal or governmental proceedings
pending to which the Company or any of its subsidiaries is a party or of which
any property or assets of the Company or any of its subsidiaries is the subject
which, if determined adversely to the Company or any of its subsidiaries, would
reasonably be expected to have a Material Adverse Effect; and, except as
otherwise disclosed in the Disclosure Package, to the Company's and each
subsidiary's knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others.
(dd) Annual Report. There are no contracts or other documents that as
of the filing date of the annual report on Form 10-K would be required to be
filed as exhibits to a Company registration statement pursuant to Item 601(10)
of Regulation S-K that have not been so filed as of March 7, 2005.
(ee) Labor Matters. No labor disturbance by the employees of the
Company or any subsidiary exists or, to the knowledge of the Company or any
subsidiary, is imminent which could reasonably be expected to have a Material
Adverse Effect.
(ff) ERISA Compliance. The Company is in compliance in all material
respects with all presently applicable provisions of the Employee Retirement
Income Security Act of 1974, as amended, including the regulations and published
interpretations thereunder ("ERISA"); no "reportable event" (as defined in
ERISA) has occurred with respect to any "pension plan" (as defined in ERISA) for
which the Company or any subsidiary would have any liability; neither
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the Company nor any subsidiary has incurred and expects to incur liability under
(i) Title IV of ERISA with respect to termination of, or withdrawal from, any
"pension plan" or (ii) Sections 412 or 4971 of the Internal Revenue Code of
1986, as amended, including the regulations and published interpretations
thereunder (the "Code"); and each "pension plan" for which the Company or any
subsidiary would have any liability that is intended to be qualified under
Section 401(a) of the Code is so qualified in all material respects and nothing
has occurred, whether by action or by failure to act, which would cause the loss
of such qualification, except for such action or failure which would not result
in a Material Adverse Effect.
(gg) List of Plans. Set forth on Exhibit D hereto is a list of each
employee pension or benefit plan with respect to which the Company or any
corporation considered an affiliate of the Company within the meaning of Section
407(d)(7) of ERISA is a party in interest or disqualified person.
(hh) Tax Law Compliance. Except as described in the Disclosure Package,
the Company and each of its subsidiaries has filed all federal, state and local
income and franchise tax returns required to be filed (subject to extensions of
time for the proper filing of such returns) through the date hereof and has paid
all taxes as set forth in such returns, and no tax deficiency has been
determined adversely to the Company, or any of its subsidiaries (nor does the
Company or any of its subsidiaries have any knowledge of any tax deficiency)
which, if determined adversely to the Company or any of its subsidiaries, might
reasonably be expected to have a Material Adverse Effect.
(ii) Issuance of Securities, Material Transactions and Dividends. Since
the date as of which information is given in the Disclosure Package through the
date hereof, and except as may otherwise be disclosed in the Disclosure Package,
neither the Company nor any Notes Guarantor has (i) issued or granted any
securities not otherwise in the ordinary course of business, (ii) incurred any
material liability or obligation, direct or contingent, other than liabilities
and obligations which were incurred in the ordinary course of business, (iii)
entered into any material transaction not in the ordinary course of business or
(iv) declared or paid any dividend on its capital stock not otherwise in the
ordinary course of business.
(jj) Books and Records. The Company and each of its subsidiaries (i)
makes and keeps accurate books and records and (ii) maintains internal
accounting controls which provide reasonable assurance that (A) transactions are
executed in accordance with management's authorization, (B) transactions are
recorded as necessary to permit preparation of its financial statements and to
maintain accountability for its assets and (C) the reported accountability for
its assets is compared with existing assets at reasonable intervals.
(kk) No Unlawful Contributions or Other Payments. To the knowledge of
the Company after reasonable investigation, neither the Company nor any of its
subsidiaries, nor any director, officer, agent, employee or other person
associated with or acting on behalf of the Company or any of its subsidiaries,
has used any corporate funds for any unlawful contribution, gift, entertainment
or other unlawful expense relating to political activity; made any direct or
indirect unlawful payment to any foreign or domestic government official or
employee from corporate funds; violated or is in violation of any provision of
the Foreign Corrupt Practices Act
10
of 1977; or made any bribe, rebate, payoff, influence payment, kickback or other
unlawful payment.
(ll) Internal Controls and Procedures. The Company has established and
maintains disclosure controls and procedures (as such term is defined in Rule
13a-15 under the Exchange Act), which (i) are designed to ensure that material
information relating to the Company, including its consolidated subsidiaries, is
made known to the Company's principal executive officer and its principal
financial officer by others within those entities, particularly during the
periods in which the periodic reports required under the Exchange Act are being
prepared; (ii) have been evaluated for effectiveness as of a date within 90 days
prior to the filing of the Company's most recent annual or quarterly report
filed with the Commission; and (iii) are effective in all material respects to
perform the functions for which they were established.
(mm) No Material Weakness in Internal Controls. Based on the evaluation
of its disclosure controls and procedures, the Company is not aware of (i) any
significant deficiency in the design or operation of internal controls which
could adversely affect the Company's ability to record, process, summarize and
report financial data or any material weaknesses in internal controls, except as
disclosed in the Disclosure Package and the Prospectus; or (ii) any fraud,
whether or not material, that involves management or other employees who have a
significant role in the Company's internal controls.
(nn) No Significant Changes in Internal Controls. 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.
(oo) ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Compliance. The Company and, to the knowledge of
the Company, its officers and its directors are in compliance in all material
respects with applicable provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 (the
"▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act") and the rules and regulations promulgated in connection
therewith that are effective as of the date hereof.
(pp) Compliance with Environmental Laws. There has been no storage,
disposal, generation, manufacture, refinement, transportation, handling or
treatment of toxic wastes, medical wastes, hazardous wastes or hazardous
substances by the Company or any of its subsidiaries (or, to the knowledge of
the Company or any of its subsidiaries or any of their predecessors in interest)
upon or from any of the property now or previously owned or leased by the
Company or any of its subsidiaries in violation of any applicable law,
ordinance, rule, regulation, order, judgment, decree or permit or which would
require remedial action under any applicable law, ordinance, rule, regulation,
order, judgment, decree or permit, except for any violation or remedial action
which would not have, or could not be reasonably likely to have, singularly or
in the aggregate with all such violations and remedial actions, a Material
Adverse Effect; there has been no material spill, discharge, leak, emission,
injection, escape, dumping or release of any kind onto such property or into the
environment surrounding such property of any toxic wastes, medical wastes, solid
wastes, hazardous wastes or hazardous substances due to or caused by the Company
or any of its subsidiaries or with respect to which the Company or any of its
subsidiaries have knowledge, except for any such spill, discharge, leak,
emission, injection,
11
escape, dumping or release which would not have or would not be reasonably
likely to have, singularly or in the aggregate with all such spills, discharges,
leaks, emissions, injections, escapes, dumpings and releases, a Material Adverse
Effect; and the terms "hazardous wastes", "toxic wastes", "hazardous substances"
and "medical wastes" shall have the meanings specified in any applicable local,
state, federal and foreign laws or regulations with respect to environmental
protection.
(qq) No Price Stabilization or Manipulation. Neither the Company nor
any of its subsidiaries nor any of their respective affiliates has taken any
action which is designed to or which has constituted stabilization or
manipulation of the price of any security of the Company, the Notes Guarantors
or any of their respective subsidiaries to facilitate the sale or resale of the
Securities.
(rr) No Restrictions on Dividends. No Restricted Subsidiary (as defined
in the Indenture) of the Company is currently prohibited, directly or
indirectly, from paying any dividends to the Company, from making any other
distribution on such Restricted Subsidiary's capital stock, from repaying to the
Company any loan or advances to such Restricted Subsidiary from the Company or
from transferring any of such Restricted Subsidiary's property or assets to the
Company or any other Restricted Subsidiary of the Company, except as described
in or contemplated by the Disclosure Package and the Prospectus or pursuant to
the provisions of (1) that certain indenture, dated May 7, 2003, governing the
Company's 7.50% Senior Notes due 2011, (2) that certain indenture, dated March
23, 2005, governing the Company's 6.25% Senior Notes due 2013 and (3) that
certain Third Amended and Restated Credit Agreement, dated May 3, 2002 by and
among the Company, ▇▇▇▇▇▇ Commercial Paper Inc. and other parties thereto, as
amended and restated from time to time.
(ss) No Violation of Regulations. None of the transactions contemplated
by this Agreement (including without limitation, the use of the proceeds from
the sale of the Notes), will violate or result in a violation of Section 7 of
the Exchange Act, or any regulation promulgated thereunder, including, without
limitation, Regulations T, U, and X of the Board of Governors of the Federal
Reserve System.
(tt) Assets of Notes Guarantors. Immediately after each of the Notes
Guarantors has entered into the Guarantee to which it is a party, (i) the fair
value of the assets of such Notes Guarantor will exceed the debts and
liabilities, subordinated, contingent or otherwise, of such Notes Guarantor,
(ii) the present fair saleable value of the property of such Notes Guarantor
will be greater than the amount that will be required to pay the probable
liabilities of such Notes Guarantor on its debts and other liabilities,
subordinated, contingent or otherwise, as such debts and other liabilities,
subordinated, contingent or otherwise, become absolute and matured, (iii) such
Notes Guarantor will be able to pay its debts and other liabilities,
subordinated, contingent or otherwise, as such debts and other liabilities
become absolute and matured, and (iv) such Notes Guarantor will not have an
unreasonably small capital with which to conduct the business in which it is
engaged as such business is conducted and is proposed to be conducted following
the Closing Date.
12
Neither the Company nor any of its subsidiaries intend, or intends to
permit any of its respective subsidiaries, to incur debts beyond its ability to
pay such debts as they mature, taking into account the timing and the amounts of
cash to be received by the Company or any of its subsidiaries and the timing and
the amounts of cash to be payable on or in respect of the Company's indebtedness
or the indebtedness of each subsidiary.
(uu) Related-Party Transactions. No relationship, direct or indirect,
that would be required to be described under Item 404 of Regulation S-K
promulgated under the Securities Act, exists between or among the Company, any
Notes Guarantor on the one hand, and the directors, officers, stockholders,
customers or suppliers of the Company, or any Notes Guarantor on the other hand,
other than as described in the Disclosure Package and the Prospectus.
(vv) Ratio of Earnings to Fixed Charges. The Company's ratio of
earnings to fixed charges set forth in each of the preliminary prospectus and
the Prospectus under the caption "Ratio of Earnings to Fixed Charges" and in
Exhibit 12 to the Registration Statement have been calculated in compliance in
all material respects with the requirements of Item 503(d) of Regulation S-K
under the Securities Act.
Any certificate signed by an officer of the Company and delivered to
the Representatives or to counsel for the Underwriters in connection with this
Agreement shall be deemed to be a representation and warranty by the Company to
each Underwriter as to the matters set forth therein subject to the statements
and qualifications set forth therein.
SECTION 2. Purchase, Sale and Delivery of the Securities.
(a) The Notes. On the basis of the representations, warranties and
agreements herein contained, and upon the terms but subject to the conditions
herein set forth, the Company agrees to issue and sell to the several
Underwriters the Notes upon the terms herein set forth, and the Underwriters
agree, severally and not jointly, to purchase from the Company the respective
aggregate principal amount of Notes set forth opposite their names on Schedule
A. The purchase price per Note to be paid by the several Underwriters to the
Company shall be equal to 98.5% of the principal amount thereof.
(b) The Closing Date. Delivery of the Securities to be purchased by the
Underwriters and payment therefor shall be made at the offices of ▇▇▇▇▇▇ &
▇▇▇▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (or such other place as
may be agreed to by the Company and the Representatives) at 9:00 a.m. New York
time, on January 23, 2006, or such other time and date as the Representatives
and the Company shall agree (the time and date of such closing are called the
"Closing Date").
(c) Public Offering of the Notes. The Representatives hereby advise the
Company that the Underwriters intend to offer for sale to the public, as
described in the Disclosure Package and the Prospectus, their respective
portions of the Notes as soon after this Agreement has been executed, the
Representatives, in their sole judgment, have determined is advisable and
practicable.
13
(d) Payment for the Notes. Payment for the Notes shall be made on the
Closing Date by wire transfer of immediately available funds to the order of the
Company.
It is understood that the Representatives have been authorized, for
their own account and the accounts of the several Underwriters, to accept
delivery of and receipt for, and make payment of the purchase price for, the
Notes. BAS, individually and not as the Representative of the Underwriters, may
(but shall not be obligated to) make payment for any Notes to be purchased by
any Underwriter whose funds shall not have been received by the Representatives
by the Closing Date for the account of such Underwriter, but any such payment
shall not relieve such Underwriter from any of its obligations under this
Agreement.
(e) Delivery of the Notes. Delivery of the Notes shall be made through
the facilities of The Depository Trust Company ("DTC") unless the
Representatives shall otherwise instruct. Time shall be of the essence, and
delivery at the time and place specified in this Agreement is a further
condition to the obligations of the Underwriters.
(f) Delivery of Prospectus to the Underwriters. Not later than 10:00
a.m. on the second business day following the date the Notes are first released
by the Underwriters for sale to the public, the Company shall deliver or cause
to be delivered copies of the Prospectus in such quantities and at such places
as the Representatives shall reasonably request.
SECTION 3. Covenants of the Company and the Notes Guarantors. The
Company and the Notes Guarantors, jointly and severally, covenant and agree with
each of the Underwriters as follows:
(a) Representatives' Review of Proposed Amendments and Supplements.
During the period beginning on the Applicable Time and ending on the later of
the Closing Date or such date, as in the opinion of counsel for the
Underwriters, the Prospectus is no longer required by law to be delivered in
connection with sales by an Underwriter or dealer, including in circumstances
where such requirement may be satisfied pursuant to Rule 172 (the "Prospectus
Delivery Period"), prior to amending or supplementing the Registration
Statement, the Disclosure Package or the Prospectus, the Company shall furnish
to the Representatives for review a copy of each such proposed amendment or
supplement, and the Company shall not file or use any such proposed amendment or
supplement to which the Representatives reasonably object.
(b) Securities Act Compliance. During the Prospectus Delivery Period,
the Company shall promptly advise the Representatives in writing (i) when the
Registration Statement, if not effective at the Execution Time, shall have
become effective, (ii) of the receipt of any comments of, or requests for
additional or supplemental information from, the Commission, (iii) of the time
and date of any filing of any post-effective amendment to the Registration
Statement or any amendment or supplement to any preliminary prospectus or the
Prospectus, (iv) of the time and date that any post-effective amendment to the
Registration Statement becomes effective, and (v) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or of any order or notice preventing or suspending the use of the
Registration Statement, any preliminary prospectus or the Prospectus, or of any
receipt by the Company of any notification with respect to the suspension of the
qualification of the Notes for
14
sale in any jurisdiction or of the threatening or initiation of any proceedings
for any of such purposes. The Company shall use commercially reasonable efforts
to prevent the issuance of any such stop order or prevention or suspension of
such use. If the Commission shall enter any such stop order or order or notice
of prevention or suspension at any time, the Company will use commercially
reasonable efforts to promptly obtain the lifting of such order. Additionally,
the Company agrees that it shall comply with the provisions of Rules 424(b) and
430B, as applicable, under the Securities Act, and will use commercially
reasonable efforts to confirm that any filings made by the Company under such
Rule 424(b) were received in a timely manner by the Commission.
(c) Exchange Act Compliance. During the Prospectus Delivery Period, the
Company will file, on a timely basis, with the Commission and the New York Stock
Exchange all reports and documents required to be filed under the Exchange Act
in the manner and within the time periods required by the Exchange Act.
(d) Final Term Sheet. The Company will prepare a final term sheet
containing solely a description of the Notes, including the price at which the
Notes are to be sold to the public, in a form approved by the Representatives,
and will file such term sheet pursuant to Rule 433(d) under the Securities Act
within the time required by such rule (such term sheet, the "Final Term Sheet").
(e) Permitted Free Writing Prospectuses. The Company represents that it
has not made, and agrees that, unless it obtains the prior written consent of
the Representatives, it will not make, any offer relating to the Securities that
would constitute an Issuer Free Writing Prospectus or that would otherwise
constitute a "free writing prospectus" (as defined in Rule 405 of the Securities
Act) required to be filed by the Company with the Commission or retained by the
Company under Rule 433 of the Securities Act; provided that the prior written
consent of the Representatives hereto shall be deemed to have been given in
respect of the Free Writing Prospectuses included in Schedule C hereto; and
provided further that no such prior written consent shall be required for the
Final Term Sheet. Any such free writing prospectus consented to by the
Representatives is hereinafter referred to as a "Permitted Free Writing
Prospectus." The Company agrees that (i) it has treated and will treat, as the
case may be, each Permitted Free Writing Prospectus as an Issuer Free Writing
Prospectus, and (ii) has complied and will comply, as the case may be, with the
requirements of Rules 164 and 433 of the Securities Act applicable to any
Permitted Free Writing Prospectus, including in respect of timely filing with
the Commission, legending and record keeping. The Company consents to the use by
any Underwriter of a free writing prospectus that (1) is not an "issuer free
writing prospectus" as defined in Rule 433 and (2) contains only (i) information
describing the preliminary terms of the Securities or the offering, (ii)
information that describes the final terms of the Securities or the offering and
that is included in the Final Term Sheet of the Company contemplated in Section
3(d) or (iii) information permitted under Rule 134 under the Securities Act;
provided that each Underwriter severally covenants with the Company not to take
any action without the Company's consent which consent shall be confirmed in
writing that would result in the Company being required to file with the
Commission under Rule 433(d) under the Securities Act a free writing prospectus
prepared by or on behalf of such Underwriter that otherwise would not be
required to be filed by the Company thereunder, but for the action of the
Underwriter.
15
(f) Amendments and Supplements to the Registration Statement,
Prospectus and Other Securities Act Matters. If, during the Prospectus Delivery
Period, any event or development shall occur or condition exist as a result of
which the Disclosure Package or the Prospectus as then amended or supplemented
would include any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein in light of the
circumstances under which they were made or then prevailing, as the case may be,
not misleading, or if it shall be necessary to amend or supplement the
Disclosure Package or the Prospectus, or to file under the Exchange Act any
document that will be or be deemed to be incorporated by reference in the
Disclosure Package or the Prospectus, in order to make the statements therein,
in light of the circumstances under which they were made or then prevailing, as
the case may be, not misleading, or if in the reasonable opinion of the
Representatives it is otherwise necessary to amend or supplement the
Registration Statement, the Disclosure Package or the Prospectus, or to file
under the Exchange Act any document that will be or be deemed to be incorporated
by reference in the Disclosure Package or the Prospectus, or, at the Company's
option, to file a new registration statement containing the Prospectus, in order
to comply with law, including in connection with the delivery of the Prospectus,
the Company agrees to (i) notify the Representatives of any such event or
condition and (ii) promptly prepare (subject to Sections 3(a) and 3(e) hereof),
file with the Commission (and use commercially reasonable efforts to have any
amendment to the Registration Statement or any new registration statement be
declared effective) and furnish at its own expense to the Underwriters and to
dealers, amendments or supplements to the Registration Statement, the Disclosure
Package or the Prospectus, or any new registration statement, necessary in order
to make the statements in the Disclosure Package or the Prospectus as so amended
or supplemented, in light of the circumstances under which they were made or
then prevailing, as the case may be, not misleading or so that the Registration
Statement, the Disclosure Package or the Prospectus, as amended or supplemented,
will comply with law.
(g) Copies of any Amendments and Supplements to the Prospectus. The
Company agrees to furnish the Representatives, without charge, during the
Prospectus Delivery Period, as many copies of the Prospectus and any amendments
and supplements thereto (including any documents incorporated or deemed
incorporated by reference therein) and the Disclosure Package as the
Representatives may request.
(h) Copies of the Registration Statement and the Prospectus. The
Company will furnish to the Representatives and counsel for the Underwriters
signed copies of the Registration Statement.
(i) Blue Sky Compliance. The Company shall cooperate with the
Representatives and counsel for the Underwriters to qualify or register the
Securities for sale under (or obtain exemptions from the application of) the
state securities or blue sky laws or Canadian provincial securities laws of
those jurisdictions designated by the Representatives, shall comply in all
material respects with such laws and shall continue such qualifications,
registrations and exemptions in effect so long as required for the distribution
of the Securities. The Company shall not be required to qualify as a foreign
corporation or to take any action that would subject it to general service of
process in any such jurisdiction where it is not presently qualified or where it
would be subject to taxation as a foreign corporation, other than those arising
out of the offering or sale of the Securities in any jurisdiction where it is
not now so subject. The Company
16
will advise the Representatives promptly of the suspension of the qualification
or registration of (or any such exemption relating to) the Securities for
offering, sale or trading in any jurisdiction or any initiation or threat of any
proceeding for any such purpose, and in the event of the issuance of any order
suspending such qualification, registration or exemption, the Company shall use
its commercially reasonable efforts to promptly obtain the withdrawal thereof.
(j) Use of Proceeds. The Company shall apply the net proceeds from the
sale of the Securities sold by it in the manner described under the caption "Use
of Proceeds" in each of the Disclosure Package and the Prospectus.
(k) Agreement Not to Offer or Sell Additional Securities. During the
period of 90 days following the date of the Prospectus, the Company will not,
without the prior written consent of BAS (which consent may be withheld at the
sole discretion of BAS), directly or indirectly, sell, offer, contract or grant
any option to sell, pledge, transfer or establish an open "put equivalent
position" within the meaning of Rule 16a-1 under the Exchange Act, or otherwise
dispose of or transfer, or announce the offering of, or file any registration
statement under the Securities Act in respect of, any debt securities of the
Company or securities exchangeable for or convertible into debt securities of
the Company (other than as contemplated by this Agreement).
(l) DTC Approval. The Company shall use commercially reasonable efforts
to obtain the approval of DTC to permit the Notes to be eligible for
"book-entry" transfer and settlement through the facilities of DTC.
(m) Earnings Statement. As soon as practicable, the Company will make
generally available to its security holders and to the Representatives an
earnings statement (which need not be audited) covering a twelve-month period
that satisfies the provisions of Section 11(a) of the Securities Act and Rule
158 under the Securities Act.
(n) Filing Fees. The Company agrees to pay the required Commission
filing fees relating to the Securities (or, alternatively, offset such fees in
accordance with Rule 457(p) of the Securities Act) within the time required by
Rule 456(b)(1) of the Securities Act without regard to the proviso therein and
otherwise in accordance with Rules 456(b) and 457(r) of the Securities Act.
(o) Future Reports to Stockholders. During the period of two years
hereafter the Company will furnish to the Representatives (i) to the extent not
available on ▇▇▇▇▇, as soon as practicable after the end of each fiscal year,
copies of the Annual Report of the Company containing the balance sheet of the
Company as of the close of such fiscal year and statements of income,
stockholders' equity and cash flows for the year then ended and the opinion
thereon of the Company's independent public or certified public accountants;
(ii) to the extent not available on ▇▇▇▇▇, as soon as practicable after the
filing thereof, copies of each proxy statement, Annual Report on Form 10-K,
Quarterly Report on Form 10-Q, Current Report on Form 8-K or other report filed
by the Company with the Commission, the NASD or any securities exchange; and
(iii) to the extent not available on ▇▇▇▇▇, as soon as available, copies of any
publicly available report or communication of the Company mailed generally to
holders of its capital stock.
17
(p) Investment Limitation. The Company shall not invest or otherwise
use the proceeds received by the Company from its sale of the Securities in such
a manner as would require the Company or any of its subsidiaries to register as
an investment company under the Investment Company Act.
(q) Use of Preliminary Prospectus. The Company consents to the use and
delivery of any preliminary prospectus by the Representatives in accordance with
Rule 430 and Section 5(b) of the Securities Act.
(r) No Manipulation of Price. The Company will not take, directly or
indirectly, any action designed to cause or result in, or that has constituted
or might reasonably be expected to constitute, under the Exchange Act or
otherwise, the stabilization or manipulation of the price of any securities of
the Company to facilitate the sale or resale of the Securities; provided,
however, that this paragraph shall not apply to any stabilization or
manipulation activities conducted by the Underwriters, who shall remain solely
responsible for such activities.
SECTION 4. Payment of Expenses. Whether or not the transactions
contemplated by this Agreement are consummated or this Agreement becomes
effective or is terminated, the Company and the Notes Guarantors, jointly and
severally, agree, to pay all costs, expenses, fees and taxes incident to and in
connection with: (i) the preparation, printing, filing and distribution of the
Registration Statement (including financial statements, exhibits, schedules,
consents and certificates of experts), each Issuer Free Writing Prospectus, each
preliminary prospectus and the Prospectus, and all amendments and supplements
thereto (including the fees, disbursements and expenses of the Company's
accountants and counsel, but not, however, legal fees and expenses of the
Underwriters' counsel incurred in connection therewith); (ii) the preparation,
printing (including, without limitation, word processing and duplication costs)
and delivery of any Agreement among Underwriters, this Agreement, the Indenture,
any blue sky memorandum and all other agreements, memoranda, correspondence and
other documents printed and delivered in connection therewith (but not, however,
legal fees and expenses of the Underwriters' counsel incurred in connection with
any of the foregoing other than fees of such counsel plus reasonable
disbursements incurred in connection with the preparation, printing and delivery
of such blue sky memoranda); (iii) the issuance and delivery by the Company of
the Notes and by the Notes Guarantors of the Guarantees and any taxes payable in
connection therewith; (iv) the qualification of the Securities for offer and
sale under the securities or blue sky laws of the several states (including,
without limitation, the reasonable fees and disbursements of the Underwriters'
counsel relating to such registration or qualification); (v) the preparation of
certificates for the Securities (including, without limitation, printing and
engraving thereof); (vi) the approval of the Notes by DTC for "book-entry"
transfer (including fees and expenses of counsel); (vii) the rating of the
Notes; (viii) the obligations of the Trustee, any agent of the Trustee and the
counsel for the Trustee in connection with the Indenture and the Securities;
(ix) Item 14 of Part II of the Registration Statement; and (x) the performance
by the Company and the Notes Guarantors of their other obligations under this
Agreement. It is understood, however, that, except as provided in this Section
4, Sections 6, 7 and 8 hereof, the Underwriters will pay all of their own costs
and expenses, including the fees and expenses of their counsel.
18
SECTION 5. Conditions to the Obligations of the Underwriters. The
obligations of the several Underwriters hereunder shall be subject to the
accuracy, when made and on and as of the Closing Date, of the representations
and warranties of the Company and each Notes Guarantor contained herein, to the
performance by the Company and each Notes Guarantor of their respective
obligations hereunder, and to each of the following additional conditions:
(a) Accountants' Comfort Letter. On the date hereof, the
Representatives shall have received from Ernst & Young LLP, independent public
accountants for the Company, a letter dated the date hereof addressed to the
Underwriters, the form of which is attached as Exhibit A.
(b) CFO Certificate. On the date hereof, the Representatives shall have
received from the Chief Financial Officer of the Company, a certificate dated
the date hereof addressed to the Underwriters, the form of which is attached as
Exhibit E-1. On the Closing Date, the Representatives shall have received from
the Chief Financial Officer of the Company, a certificate dated such date, the
form of which is attached as Exhibit E-2, to the effect that he reaffirms in all
material respects the statements made in the certificate furnished by him
pursuant to the previous sentence of this subsection (b), except that the
specified date referred to in paragraph 3 therein for carrying out of procedures
shall be no more than three business days prior to the Closing Date.
(c) Compliance with Registration Requirements; No Stop Order. For the
period from and after effectiveness of this Agreement and prior to the Closing
Date:
(i) the Company shall have filed the Prospectus with the
Commission (including the information required by Rule 430B under the
Securities Act) in the manner and within the time period required by
Rule 424(b) under the Securities Act;
(ii) the Final Term Sheet, and any other material required to
be filed by the Company pursuant to Rule 433(d) under the Securities
Act, shall have been filed with the Commission within the applicable
time periods prescribed for such filings under such Rule 433; and
(iii) no stop order suspending the effectiveness of the
Registration Statement, or any post-effective amendment to the
Registration Statement, shall be in effect and no proceedings for such
purpose shall have been instituted or threatened by the Commission; and
the Company shall not have received from the Commission any notice
pursuant to Rule 401(g)(2) of the Securities Act objecting to use of
the automatic shelf registration statement form.
(d) No Material Adverse Change. (i) Neither the Company, any Notes
Guarantor nor any of their respective subsidiaries shall have sustained, since
the date of the latest audited financial statements included or incorporated by
reference in the Disclosure Package and the Prospectus, any material loss or
interference with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court or
governmental action, order or decree, which loss or interference could
reasonably be expected to have a Material Adverse Effect otherwise than as set
forth or contemplated in the Disclosure Package and the Prospectus; and (ii)
since such date, there shall not have been any change in the
19
capital stock or long-term debt of the Company, any Notes Guarantor or any of
their respective subsidiaries or any material adverse change, or any development
involving a prospective material adverse change, in or affecting the general
affairs, management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, otherwise than as set forth or
contemplated in the Disclosure Package and the Prospectus.
(e) No Ratings Agency Change. Subsequent to the execution and delivery
of this Agreement (i) no downgrading shall have occurred in the rating according
the Company's senior unsecured debt securities by any "nationally recognized
statistical rating organization," as that term is defined by the Commission for
purposes of Rule 436(g)(2) of the Securities Act and (ii) no such organization
shall have publicly announced that it has under surveillance or review, with
possible negative implications, its rating of any of the Company's senior
unsecured debt securities.
(f) Opinion of Counsel for the Company. On the Closing Date, the
Representatives shall have received the opinion of ▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇ PLC,
counsel for the Company, dated as of such Closing Date, the form of which is
attached as Exhibit B.
(g) Opinion of Maryland Counsel for the Company. On the Closing Date,
the Representatives shall have received the opinion of Miles & Stockbridge PC,
counsel for the Company, dated as of such Closing Date, the form of which is
attached as Exhibit C.
(h) Opinion of Counsel for the Underwriters. On the Closing Date, the
Representatives shall have received the opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, counsel
for the Underwriters, dated as of the Closing Date, in form and substance
reasonably satisfactory to, and addressed to, the Representatives, with respect
to the issuance and sale of the Notes, the Registration Statement, the
Prospectus (together with any supplement thereto), the Disclosure Package and
other related matters as the Representatives may reasonably require, and the
Company shall have furnished to such counsel such documents as they reasonably
request for the purpose of enabling them to pass upon such matters.
(i) Officers' Certificate. On the Closing Date, the Representatives
shall have received a written certificate executed by the Chairman of the Board,
Chief Executive Officer or President of the Company and the Chief Financial
Officer or Chief Accounting Officer of the Company, dated as of the Closing
Date, to the effect that the signers of such certificate have carefully examined
the Registration Statement, the Prospectus and any amendment or supplement
thereto, any Issuer Free Writing Prospectus and any amendment or supplement
thereto and this Agreement, to the effect that:
(i) the representations, warranties and covenants of the
Company set forth in Section 1 of this Agreement are true and correct
on and as of the Closing Date with the same force and effect as though
expressly made on and as of such Closing Date; and
(iii) the Company has complied with all the agreements
hereunder and satisfied all the conditions set forth in Sections 5(c),
(d) and (e) at or prior to such Closing Date.
(j) Bring-down Comfort Letter. On the Closing Date, the Representatives
shall have received from Ernst & Young LLP, independent public accountants for
the Company, a letter
20
dated such date, in form and substance satisfactory to the Representatives, to
the effect that they reaffirm the statements made in the letter furnished by
them pursuant to subsection (a) of this Section 5, except that the specified
date referred to therein for the carrying out of procedures shall be no more
than three business days prior to the Closing Date.
(k) Indenture. The Company, the Notes Guarantors and the Trustee shall
have executed and delivered the Indenture, and the Representatives shall have
received an original copy thereof, duly executed by the Company, the Notes
Guarantors and the Trustee.
(l) DTC Approval. On or before the Closing Date, DTC shall have
accepted the Securities for "book-entry" transfer and settlement through the
facilities of DTC.
(m) QIU Certificate. On the date hereof, the Representatives shall have
received from the QIU, as qualified independent underwriter, a letter dated the
date hereof addressed to the Underwriters, in form and substance satisfactory to
the Representatives.
(n) Additional Documents. On or before the Closing Date, the
Representatives and counsel for the Underwriters shall have received such
information, documents and opinions as they may reasonably require for the
purpose of enabling them to pass upon the issuance and sale of the Securities as
contemplated herein, or in order to evidence the accuracy of any of the
representations and warranties, or the satisfaction of any of the conditions or
agreements, herein contained.
If any condition specified in this Section 5 is not satisfied when and
as required to be satisfied, this Agreement may be terminated by the
Representatives by notice to the Company at any time on or prior to the Closing
Date, which termination shall be without liability on the part of any party to
any other party, except that Sections 4, 6, 7, 8 and 11 through 17 hereof shall
at all times be effective and shall survive such termination.
SECTION 6. Reimbursement of Underwriters' Expenses. If this Agreement
is terminated by the Representatives pursuant to Section 5 hereof, or if the
sale to the Underwriters of the Notes on the Closing Date is not consummated
because of any refusal, inability or failure on the part of the Company or any
Notes Guarantor to perform any agreement herein or to comply with any provision
hereof, the Company and the Notes Guarantors agree to reimburse the
Representatives and the other Underwriters (or such Underwriters as have
terminated this Agreement with respect to themselves), severally, upon demand
for all reasonable out-of-pocket expenses that shall have been reasonably
incurred by the Representatives and the Underwriters in connection with the
proposed purchase and the offering and sale of the Notes, including but not
limited to, reasonable fees and disbursements of counsel, printing expenses,
travel expenses, postage, facsimile and telephone charges. If this Agreement is
terminated pursuant to Section 9 by reason of the default of one or more
Underwriters, the Company and the Notes Guarantors shall not be obligated to
reimburse any defaulting Underwriter on account of those expenses.
SECTION 7. Indemnification.
(a) Indemnification of the Underwriters. The Company and each of the
Notes Guarantors agree to indemnify and hold harmless each Underwriter, its
directors, officers, employees and agents, and each person, if any, who controls
any Underwriter within the
21
meaning of the Securities Act and the Exchange Act against any loss, claim,
damage, liability or expense, as incurred, to which such Underwriter, its
directors, officers, employees, agents or such controlling person may become
subject, insofar as such loss, claim, damage, liability or expense (or actions
in respect thereof as contemplated below) arises out of or is based (i) upon any
untrue statement or alleged untrue statement of a material fact contained in the
Registration Statement, or any amendment thereto, including any information
deemed to be a part thereof pursuant to Rule 430A, Rule 430B or Rule 430C under
the Securities Act, or the omission or alleged omission therefrom of a material
fact required to be stated therein or necessary to make the statements therein
not misleading; or (ii) upon any untrue statement or alleged untrue statement of
a material fact contained in any Issuer Free Writing Prospectus, the information
contained in the Final Term Sheet, any preliminary prospectus or the Prospectus
(or any amendment or supplement thereto), or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements therein,
in light of the circumstances under which they were made, not misleading, and to
reimburse each Underwriter, its directors, officers, employees, agents and each
such controlling person for any and all expenses (including the fees and
disbursements of counsel chosen by BAS) as such expenses are reasonably incurred
by such Underwriter, or its officers, directors, employees and agents or such
controlling person in connection with investigating, defending, settling,
compromising or paying any such loss, claim, damage, liability, expense or
action; provided, however, that the foregoing indemnity agreement shall not
apply to any loss, claim, damage, liability or expense to the extent, but only
to the extent, arising out of or based upon any untrue statement or alleged
untrue statement or omission or alleged omission made in reliance upon and in
conformity with written information furnished to the Company by the
Representatives expressly for use in the Registration Statement, any Issuer Free
Writing Prospectus, any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto). The indemnity agreement set forth in this
Section 7(a) shall be in addition to any liabilities that the Company may
otherwise have.
(b) Indemnification of the Company, the Notes Guarantors and their
respective Directors and Officers. Each Underwriter agrees, severally and not
jointly, to indemnify and hold harmless the Company and the Notes Guarantors,
each of their directors, each of their officers who signed the Registration
Statement and each person, if any, who controls the Company or one of the Notes
Guarantors within the meaning of the Securities Act or the Exchange Act, against
any loss, claim, damage, liability or expense, as incurred, to which the
Company, or any such director, officer or controlling person may become subject,
insofar as such loss, claim, damage, liability or expense (or actions in respect
thereof as contemplated below) arises out of or is based (i) upon any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement, or any amendment thereto, including any information
deemed to be a part thereof pursuant to Rule 430B or Rule 430C under the
Securities Act, or the omission or alleged omission therefrom of a material fact
required to be stated therein or necessary to make the statements therein not
misleading; or (ii) upon any untrue statement or alleged untrue statement of a
material fact contained in any Issuer Free Writing Prospectus, any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto), or the
omission or alleged omission therefrom of a material fact necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading, in each case to the extent, and only to the extent, that
such untrue statement or alleged untrue statement or omission or alleged
omission was made in the Registration Statement, any Issuer Free Writing
Prospectus, any preliminary prospectus or the Prospectus (or any amendment or
22
supplement thereto), in reliance upon and in conformity with written information
furnished to the Company by the Representatives expressly for use therein; and
to reimburse the Company and the Notes Guarantors, or any such director, officer
or controlling person for any legal and other expense reasonably incurred by the
Company and the Notes Guarantors, or any such director, officer or controlling
person in connection with investigating, defending, settling, compromising or
paying any such loss, claim, damage, liability, expense or action. The Company
hereby acknowledges that the only information that the Underwriters have
furnished to the Company expressly for use in the Registration Statement, any
Issuer Free Writing Prospectus, any preliminary prospectus or the Prospectus (or
any amendment or supplement thereto) are the statements set forth in the table
following the first paragraph and in the third and ninth paragraphs under the
caption "Underwriting" in the prospectus supplement; the indemnity agreement set
forth in this Section 7(b) shall be in addition to any liabilities that each
Underwriter may otherwise have.
(c) Notifications and Other Indemnification Procedures. Promptly after
receipt by an indemnified party under this Section 7 of notice of the
commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against an indemnifying party under this Section 7, notify
the indemnifying party in writing of the commencement thereof; but the failure
to so notify the indemnifying party (i) will not relieve it from liability under
paragraph (a) or (b) above unless and to the extent it did not otherwise learn
of such action and such failure results in the forfeiture by the indemnifying
party of substantial rights and defenses and (ii) will not, in any event,
relieve the indemnifying party from any liability other than the indemnification
obligation provided in paragraph (a) or (b) above. In case any such action is
brought against any indemnified party and such indemnified party seeks or
intends to seek indemnity from an indemnifying party, the indemnifying party
will be entitled to participate in, and, to the extent that it shall elect,
jointly with all other indemnifying parties similarly notified, by written
notice delivered to the indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to assume the defense thereof with counsel
satisfactory to such indemnified party; provided, however, if the defendants in
any such action include both the indemnified party and the indemnifying party
and the indemnified party shall have reasonably concluded that a conflict may
arise between the positions of the indemnifying party and the indemnified party
in conducting the defense of any such action or that there may be legal defenses
available to it and/or other indemnified parties that are different from or
additional to those available to the indemnifying party, the indemnified party
or parties shall have the right to select separate counsel to assume such legal
defenses and to otherwise participate in the defense of such action on behalf of
such indemnified party or parties. Upon receipt of notice from the indemnifying
party to such indemnified party of such indemnifying party's election so to
assume the defense of such action and approval by the indemnified party of
counsel, the indemnifying party will not be liable to such indemnified party
under this Section 7 for any legal or other expenses subsequently incurred by
such indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate counsel (other than local counsel), reasonably approved by the
indemnifying party (or by BAS in the case of Section 9), representing the
indemnified parties who are parties to such action) or (ii) the indemnifying
party shall not have employed counsel satisfactory to the indemnified party to
represent the indemnified party within
23
a reasonable time after notice of commencement of the action, in each of which
cases the fees and expenses of counsel shall be at the expense of the
indemnifying party.
(d) Settlements. The indemnifying party under this Section 7 shall not
be liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
against any loss, claim, damage, liability or expense by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by Section
7(c) hereof, the indemnifying party agrees that it shall be liable for any
settlement of any proceeding effected without its written consent if (i) such
settlement is entered into more than 45 days after receipt by such indemnifying
party of the aforesaid request and (ii) such indemnifying party shall not have
reimbursed the indemnified party in accordance with such request prior to the
date of such settlement. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement, compromise or consent
to the entry of judgment in any pending or threatened action, suit or proceeding
in respect of which any indemnified party is or could have been a party and
indemnity was or could have been sought hereunder by such indemnified party,
unless such settlement, compromise or consent (i) includes an unconditional
release of such indemnified party from all liability on claims that are the
subject matter of such action, suit or proceeding and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to act, by or
on behalf of any indemnified party.
(e) Indemnification of the QIU. Without limitation and in addition to
its obligation under the other subsections of this Section 7, the Company agrees
to indemnify and hold harmless the QIU, its directors, officers, employees and
agents and each person, if any, who controls the QIU within the meaning of the
Securities Act or the Exchange Act from and against any loss, claim, damage,
liabilities or expense, as incurred, arising out of or based upon the QIU's
acting as a "qualified independent underwriter" (within the meaning of Section
(b)(15) of NASD Conduct Rule 2720) in connection with the offering contemplated
by this Agreement, and agrees to reimburse each such indemnified person for any
legal or other expense reasonably incurred by them in connection with
investigating, defending, settling, compromising or paying any such loss, claim,
damage, liability, expense or action; provided, however, that the Company shall
not be liable in any such case to the extent that any such loss, claim, damage,
liability or expense results from the gross negligence or willful misconduct of
the QIU.
SECTION 8. Contribution. If the indemnification provided for in Section
7 is for any reason unavailable to or otherwise insufficient to hold harmless an
indemnified party in respect of any losses, claims, damages, liabilities or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount paid or payable by such indemnified party, as incurred, as
a result of any losses, claims, damages, liabilities or expenses referred to
therein (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company and the Notes Guarantors, on the one hand, and
the Underwriters, on the other hand, from the offering of the Securities
pursuant to this Agreement or (ii) if the allocation provided by clause (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 (i) above but
also the relative fault of the Company and the Notes Guarantors, on the one
hand, and the Underwriters, on the other hand, in
24
connection with the statements or omissions or inaccuracies in the
representations and warranties herein which resulted in such losses, claims,
damages, liabilities or expenses, as well as any other relevant equitable
considerations. The relative benefits received by the Company and the Notes
Guarantors, on the one hand, and the Underwriters, on the other hand, in
connection with the offering of the Securities pursuant to this Agreement shall
be deemed to be in the same respective proportions as the total net proceeds
from the offering of the Securities pursuant to this Agreement (before deducting
expenses) received by the Company and the Notes Guarantors, and the total
underwriting discount received by the Underwriters, in each case as set forth on
the front cover page of the Prospectus bear to the aggregate initial public
offering price of the Securities as set forth on such cover. The relative fault
of the Company and the Notes Guarantors, on the one hand, and the Underwriters,
on the other hand, shall be determined by reference to, among other things,
whether any such untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact or any such inaccurate or
alleged inaccurate representation or warranty relates to information supplied by
the Company and the Notes Guarantors, on the one hand, or the Underwriters, on
the other hand, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The amount paid or payable by a party as a result of the losses,
claims, damages, liabilities and expenses referred to above shall be deemed to
include, subject to the limitations set forth in Section 7(c), any legal or
other fees or expenses reasonably incurred by such party in connection with
investigating or defending any action or claim. The provisions set forth in
Section 7(c) with respect to notice of commencement of any action shall apply if
a claim for contribution is to be made under this Section 8; provided, however,
that no additional notice shall be required with respect to any action for which
notice has been given under Section 7(c) for purposes of indemnification.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 8 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 this Section 8.
Notwithstanding the provisions of this Section 8, no Underwriter shall
be required to contribute any amount in excess of the underwriting commissions
received by such Underwriter in connection with the Securities underwritten by
it and distributed to the public. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations to contribute
pursuant to this Section 8 are several, and not joint, in proportion to their
respective underwriting commitments as set forth opposite their names in
Schedule A. For purposes of this Section 8, each director, officer, employee and
agent of an Underwriter and each person, if any, who controls an Underwriter
within the meaning of the Securities Act and the Exchange Act shall have the
same rights to contribution as such Underwriter, and each director, officer and
employee of the Company and the Notes Guarantors, and each person, if any, who
controls the Company and the Notes Guarantors within the meaning of the
Securities Act and the Exchange Act shall have the same rights to contribution
as the Company and the Notes Guarantors.
25
SECTION 9. Default of One or More of the Several Underwriters. If, on
the Closing Date, any one or more of the several Underwriters shall fail or
refuse to purchase Securities that it or they have agreed to purchase hereunder
on such date, and the aggregate principal amount of Securities which such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
does not exceed 10% of the aggregate principal amount of the Securities to be
purchased on such date, the other Underwriters shall be obligated, severally, in
the proportions that the number of Securities set forth opposite their
respective names on Schedule A bears to the aggregate principal amount of
Securities set forth opposite the names of all such non-defaulting Underwriters,
or in such other proportions as may be specified by the Representatives with the
consent of the non-defaulting Underwriters, to purchase the Securities which
such defaulting Underwriter or Underwriters agreed but failed or refused to
purchase on such date. If, on the Closing Date, any one or more of the
Underwriters shall fail or refuse to purchase Securities and the principal
amount of Securities with respect to which such default occurs exceeds 10% of
the principal amount of Securities to be purchased on such date, and
arrangements satisfactory to the Representatives and the Company for the
purchase of such Securities are not made within 48 hours after such default,
this Agreement shall terminate without liability of any party to any other party
except that the provisions of Sections 4, 6, 7, 8 and 11 through 17 hereof shall
at all times be effective and shall survive such termination. In any such case
either the Representatives or the Company shall have the right to postpone the
Closing Date, but in no event for longer than seven days in order that the
required changes, if any, to the Registration Statement and the Prospectus or
any other documents or arrangements may be effected.
As used in this Agreement, the term "Underwriter" shall be deemed to
include any person substituted for a defaulting Underwriter under this Section
9. Any action taken under this Section 9 shall not relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.
SECTION 10. Termination of this Agreement. Prior to the Closing Date
this Agreement may be terminated by the Representatives by notice given to the
Company if at any time (i) trading in any of the Company's securities shall have
been suspended or limited by the Commission or by the New York Stock Exchange
(the "NYSE"), or trading in securities generally on the NYSE, the American Stock
Exchange or the over-the-counter market shall have been suspended, or minimum
prices shall have been established on any of such stock exchanges or markets by
the Commission or the NASD; (ii) a general banking moratorium shall have been
declared by federal or New York authorities or a material disruption in
commercial banking or securities settlement or clearance services in the United
States has occurred; (iii) the United States shall have become engaged in new
hostilities, there shall have been an escalation in existing hostilities
involving the United States or there shall have been a declaration of a national
emergency or war by the United States or there shall have occurred any other
significant calamity or crisis (including, without limitation, as a result of
terrorist activities); or (iv) there shall have occurred such a material adverse
change in general economic, political or financial conditions (or the effect of
international conditions on the financial markets in the United States shall be
such) as to make it, in the judgment of the Representatives, impractical or
inadvisable to proceed with the public offering or delivery of the Securities
being delivered on the Closing Date on the terms and in the manner contemplated
in the Prospectus. Any termination pursuant to this Section 10 shall be without
liability on the part of (a) the Company or the Notes Guarantors to any
Underwriter, except that the Company shall be obligated to reimburse the
expenses of the
26
Representatives and the Underwriters pursuant to Sections 4 and 6 hereof or (b)
any Underwriter to the Company or the Notes Guarantors.
SECTION 11. No Agency or Fiduciary Responsibility. The Company hereby
waives and releases, to the fullest extent permitted by law, any claims that the
Company may have against the several Underwriters with respect to any breach or
alleged breach of agency or fiduciary duty.
SECTION 12. Representations and Indemnities to Survive Delivery. The
respective indemnities, agreements, representations, warranties and other
statements of the Company, of its officers and of the several Underwriters set
forth in or made pursuant to this Agreement (i) will remain in full force and
effect, regardless of any (A) investigation made by or on behalf of any
Underwriter, the officers or employees of any Underwriter, the QIU, the officers
or employees of any Underwriter or the QIU, or the Company, the officers or
employees of the Company, or any person controlling the Company, as the case may
be or (B) acceptance of the Securities and payment for them hereunder and (ii)
will survive delivery of and payment for the Securities sold hereunder and any
termination of this Agreement.
SECTION 13. Notices. All communications hereunder shall be in writing
and shall be mailed, hand delivered or telecopied and confirmed to the parties
hereto as follows:
If to the Representatives:
Banc of America Securities LLC
▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Legal Department
with a copy to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
If to the QIU:
HSBC Securities (USA) Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
27
If to the Company:
Corrections Corporation of America
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
with a copy to:
Bass, ▇▇▇▇▇ & ▇▇▇▇ PLC
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: F. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇.
Any party hereto may change the address for receipt of communications
by giving written notice to the others.
SECTION 14. Successors. This Agreement will inure to the benefit of and
be binding upon the parties hereto, including any substitute Underwriters
pursuant to Section 9 hereof, and to the benefit of (i) the Company and the
Notes Guarantors, their directors, officers and employees, and any person who
controls the Company or any of the Notes Guarantors within the meaning of the
Securities Act and the Exchange Act, (ii) the Underwriters, the officers,
directors, employees and agents of the Underwriters, and each person, if any,
who controls any Underwriter within the meaning of the Securities Act and the
Exchange Act, (iii) the QIU, the QIU's officers, directors, employees and
agents, and each person, if any, who controls the QIU within the meaning of the
Securities Act and the Exchange Act, and (iv) the respective successors and
assigns of any of the above, 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 Securities from any of the several Underwriters merely
because of such purchase.
SECTION 15. Partial Unenforceability. The invalidity or
unenforceability of any Section, paragraph or provision of this Agreement shall
not affect the validity or enforceability of any other Section, paragraph or
provision hereof. If any Section, paragraph or provision of this Agreement is
for any reason determined to be invalid or unenforceable, there shall be deemed
to be made such minor changes (and only such minor changes) as are necessary to
make it valid and enforceable.
SECTION 16. Governing Law Provisions. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE
TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE.
SECTION 17. General Provisions. This Agreement may be executed in two
or more counterparts, each one of which shall be an original, with the same
effect as if the signatures
28
thereto and hereto were upon the same instrument. This Agreement may not be
amended or modified unless in writing by all of the parties hereto, and no
condition herein (express or implied) may be waived unless waived in writing by
each party whom the condition is meant to benefit. The Section headings herein
are for the convenience of the parties only and shall not affect the
construction or interpretation of this Agreement.
This Agreement supersedes all prior agreements and understandings
(whether written or oral) between the Company and the several Underwriters, or
any of them, with respect to the subject matter hereof.
Each of the parties hereto acknowledges that it is a sophisticated
business person who was adequately represented by counsel during negotiations
regarding the provisions hereof, including, without limitation, the
indemnification provisions of Section 7 and the contribution provisions of
Section 8, and is fully informed regarding said provisions. Each of the parties
hereto further acknowledges that the provisions of Sections 7 and 8 hereto
fairly allocate the risks in light of the ability of the parties to investigate
the Company, its affairs and its business in order to assure that adequate
disclosure has been made in the Registration Statement, any preliminary
prospectus and the Prospectus (and any amendments and supplements thereto), as
required by the Securities Act and the Exchange Act.
[Signature pages follow]
29
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to the Company the enclosed copies hereof,
whereupon this instrument, along with all counterparts hereof, shall become a
binding agreement in accordance with its terms.
Very truly yours,
CORRECTIONS CORPORATION OF AMERICA
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chief Executive Officer
30
NOTES GUARANTORS
CCA OF TENNESSEE, LLC
PRISON REALTY MANAGEMENT, INC.
TECHNICAL AND BUSINESS INSTITUTE OF
AMERICA, INC.
CCA INTERNATIONAL, INC.
CCA PROPERTIES OF AMERICA, LLC
CCA PROPERTIES OF ARIZONA, LLC
CCA PROPERTIES OF TENNESSEE, LLC
CCA WESTERN PROPERTIES, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chief Executive Officer
CCA PROPERTIES OF TEXAS, L.P.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chief Executive Officer,
CCA Properties of America, LLC, as
General Partner
TRANSCOR AMERICA LLC
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
31
The foregoing Agreement is hereby confirmed and accepted by the
Representatives as of the date first above written.
BANC OF AMERICA SECURITIES LLC
▇▇▇▇▇▇ BROTHERS INC.
WACHOVIA CAPITAL MARKETS, LLC
Acting as Representatives of the
several Underwriters named in
the attached Schedule A.
By Banc of America Securities LLC
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Principal
32
The foregoing Agreement is hereby confirmed and accepted by the QIU as
of the date first above written.
By HSBC Securities (USA) Inc.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Senior Vice President
As Qualified Independent Underwriter
33
