EXHIBIT 1
REGISTRATION AND STOCK PURCHASE AGREEMENT
Registration and Stock Purchase Agreement, dated as of July 8, 2002
(this "Agreement"), among Philadelphia Suburban Corporation, a Pennsylvania
corporation (the "Company"), Vivendi Environnement S.A., a French corporation
("VE"), Vivendi Water S.A., a French corporation ("VW"), and Vivendi North
America Company, a Delaware corporation ("VNAC").
WHEREAS, VW and VNAC are respectively the beneficial owners of
10,334,221 and 761,654 shares of the Company's common stock, par value $.50 per
share (the "Common Stock"); and
WHEREAS, after the execution of this Agreement, VW, VNAC and the
Company plan to enter into an underwriting agreement substantially in the form
of Exhibit A hereto (the "Underwriting Agreement") providing for the sale by VW
and VNAC of up to 9,885,256 shares of the Common Stock (the "Public Sale"); and
WHEREAS, following completion of the Public Sale, the Company desires
to purchase from VW, and VW desires to sell to the Company, up to 2,500,000
shares of the Common Stock (the "Buyback").
NOW, THEREFORE, in consideration of the mutual covenants and
undertakings contained herein, and on the terms and subject to the conditions
set forth herein, the parties hereto, each representing to the other that its
execution, delivery and performance of this Agreement has been fully and duly
authorized, agree as follows:
SECTION 1-DEFINITIONS
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1.1 Specific Definitions. As used in this Agreement, the following terms
shall have the meanings set forth below:
"Business Day" shall mean any day other than a Saturday, a Sunday or a
day on which banks in Philadelphia, Pennsylvania are authorized or obligated by
law or executive order to close.
"Buyback Closing" shall mean the closing of the Buyback.
"Buyback Closing Date" shall mean the date on which the Buyback Closing
occurs.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Governmental Entity" shall mean any federal, state or local judicial,
legislative, executive or regulatory authority.
"Public Closing" shall mean the closing of the Public Sale.
"Public Closing Date" shall mean the date on which the Public Closing
occurs.
"Securities Act" shall mean the Securities Act of 1933, as amended.
Other terms are defined elsewhere in this Agreement and, unless
otherwise indicated, shall have such meanings throughout this Agreement.
SECTION 2-REGISTRATION
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2.1 Registration Statement.
(a) The Company shall prepare and file with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 or any
successor form thereto (the "Registration Statement") to register the resale of
up to 9,885,256 shares of the Common Stock held by VW and VNAC (as adjusted for
any reorganization, recapitalization, reclassification, stock dividend, stock
split or combination, or any other changes to the capital structure of the
Company, the "Registered Shares"). The Company shall use commercially reasonable
efforts to obtain an order of effectiveness from the Commission as soon as
practicable after filing. The Company shall have no obligation to keep the
Registration Statement effective for more than 60 days following the issuance of
the original order of effectiveness.
(b) VE, VW and VNAC shall furnish such information as the Company may
reasonably request in connection with the preparation of the Registration
Statement in order to permit the Company to comply with all applicable
securities laws and requirements of the Commission within two days of such
request.
(c) The Company shall execute the Underwriting Agreement on the date of
pricing of the Public Sale. In the event that VE, VW and VNAC agree with the
underwriters on a price for the sale of the Registered Shares in the Public
Sale, each of VW and VNAC shall execute the Underwriting Agreement (subject to
completion of pricing information) on the date of pricing of the Public Sale.
Each of VE, VW and VNAC shall use commercially reasonable efforts to cause ▇.▇.
▇▇▇▇▇▇▇ & Sons, Inc., ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ LLC and ▇▇▇▇▇▇ ▇▇▇▇▇ to be
included in the underwriting syndicate for the Public Sale.
2.2 Use of Registration Statement. Each of VE, VW and VNAC hereby agrees
and acknowledges that (i) the Registration Statement shall relate exclusively to
a sale of the Registered Shares by VW and VNAC in a firm commitment underwriting
that is not being effected pursuant to Rule 415 under the Securities Act and
(ii) the Registration Statement shall be used solely in connection with the
Public Sale.
2.3 Indemnification.
(a) The Company agrees to indemnify and hold harmless VE, VW and VNAC,
their directors, officers and each person, if any, who controls VE, VW and VNAC
within the meaning of Section 15 of the Securities Act, from and against any
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) to which VE, VW and VNAC, their directors, officers and each person, if
any, who controls VE, VW and VNAC within the meaning of Section 15 of the
Securities Act, may become subject (under the Securities Act or otherwise) to
the extent that such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) arise out of, or are based upon, any actual or
alleged untrue statement of a material fact or actual or alleged omission to
state a material fact in the Registration Statement, including all documents
filed as a part thereof and information deemed to be incorporated by reference
therein, on the effective date thereof, or any amendment or supplements thereto,
or arise out of any failure by the Company to fulfill any undertaking or
covenant included in the Registration Statement, and the Company will, as
incurred, reimburse VE for any legal or other expenses reasonably incurred in
investigating, defending or preparing to defend any such action, proceeding or
claim; provided, however, that the Company shall not be liable in any such case
to the extent that such loss, claim, damage or liability arises out of, or is
based upon (i) an actual or alleged untrue statement or omission in such
Registration Statement in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of VE specifically for use
in preparation of the Registration Statement and not corrected by VE in writing
at least 5 Business Days prior to the sale that is the subject of such losses,
claims, damages and liabilities or (ii) an untrue statement or omission in any
prospectus that is corrected in any subsequent prospectus, or supplement or
amendment thereto, that was delivered to VE prior to the pertinent sale or sales
by VE, VW or VNAC and not delivered by VE prior to such sale(s) to the person or
entity to which it made such sale(s).
(b) VE agrees to indemnify and hold harmless the Company, its
directors, officers and each person, if any, who controls the Company within the
meaning of Section 15 of the Securities Act, from and against any losses,
claims, damages or liabilities (or actions or proceedings in respect thereof) to
which the Company, its directors, officers and each person, if any, who controls
the Company within the meaning of Section 15 of the Securities Act, may become
subject (under the Securities Act or otherwise) to the extent that such losses,
claims, damages or liabilities (or actions or proceedings in respect thereof)
arise out of, or are based upon (i) an actual or alleged untrue statement of a
material fact or actual or alleged omission to state a material fact in the
Registration Statement or any amendment or supplements thereto in reliance upon
and in conformity with written information furnished to the Company by or on
behalf of VE specifically for use in preparation of the Registration Statement
(provided, however, that VE shall not be liable in any such case for any untrue
statement or omission in any prospectus or Registration Statement which
statement has been corrected, in writing, by VE and delivered to the Company at
least 5 Business Days prior to the sale that is subject of such losses, claims,
damages and liabilities), or (ii) an untrue statement or omission in any
prospectus that is corrected in any subsequent prospectus or supplement or
amendment thereto, that was delivered to VE prior to the pertinent sale or sales
by VW or VNAC and not delivered by VW or VNAC prior to such sale(s) to the
person or entity to which it made such sale(s), and VE will, as incurred,
reimburse the Company for any legal or other expenses reasonably incurred in
investigating, defending or preparing to defend any such action, proceeding or
claim.
(c) Promptly after receipt by any indemnified person of a notice of a
claim or the beginning of any action in respect of which indemnity is to be
sought against an indemnifying person pursuant to this Section, such indemnified
person shall notify the indemnifying person in writing of such claim or of the
commencement of such action and, subject to the provisions hereinafter stated,
in case any such action shall be brought against an indemnified person, the
indemnifying person shall be entitled to participate therein, and to assume the
defense thereof, with counsel reasonably satisfactory to the indemnified person.
After notice from the indemnifying person to such indemnified person of the
indemnifying person's election to assume the defense thereof, the indemnifying
person shall not be liable to such indemnified person for any legal expenses
subsequently incurred by such indemnified person in connection with the defense
thereof; provided, however, that if there exists or shall exist a conflict of
interest that would make it inappropriate in the reasonable judgment of the
indemnified person for the same counsel to represent both the indemnified person
and such indemnifying person or any affiliate or associate thereof, the
indemnified person shall be entitled to retain its own counsel at the expense of
such indemnifying person; provided, further, that the indemnifying person shall
not be obligated to assume the expenses of more than one counsel and, to the
extent applicable, one local counsel, to represent all indemnified persons.
(d) If the indemnification provided for in this Section is unavailable
to or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above in respect of any losses, claims, damages or liabilities (or actions
or proceedings in respect thereof) referred to therein, then each indemnifying
party shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages or liabilities (or actions in
respect thereof) in such proportion as is appropriate to reflect the relative
fault of the Company on the one hand and VE, VW or VNAC on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. The relative fault shall be determined
by reference to, among other things, whether the actual or alleged untrue
statement of a material fact or the actual or alleged omission to state a
material fact relates to information supplied by the Company on the one hand or
VE on the other and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and VE agree that it would not be just and equitable if contribution
pursuant to this subsection (d) were determined by pro rata allocation or by any
other method of allocation which does not take into account the equitable
considerations referred to above in this subsection (d). The amount paid or
payable by an indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to above in this subsection
(d) shall be deemed to include any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim. 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.
2.4 Registration Expenses. VE shall reimburse the Company for all
reasonable and documented expenses of the Company incurred in connection with
the preparation and filing of the Registration Statement, including, but not
limited to, (i) all registration fees paid to the Commission relating to the
Registered Shares, (ii) all reasonable and documented expenses incurred in
connection with the printing and distribution of preliminary prospectuses and
the final prospectus (including any amendments and supplements thereto) used in
connection with the offering of the Registered Shares, (iii) the reasonable and
documented fees and disbursements of the Company's legal counsel (up to a
maximum amount of $75,000) billed in connection with the preparation and filing
of the Registration Statement and the delivery of a customary legal opinion in
connection with the offering of the Registered Shares, (iv) the reasonable and
documented fees and disbursements of the Company's auditors billed in connection
with the delivery of customary consents and comfort letters in connection with
the Registration Statement and (v) any travel expenses of the Company's officers
and employees and any other expenses of the Company in connection with attending
or hosting meetings with prospective purchasers of the Registered Shares
(collectively, the "Registration Fees"). Notwithstanding the foregoing, VE shall
not be liable for any expenses incident to the performance of the Company's
obligations under the Exchange Act, including, without limitation, the
preparation of audited annual financial statements and unaudited interim
financial statements and the filing of any Annual Reports on Form 10-K, any
Quarterly Reports on Form 10-Q and any Current Reports on Form 8-K (including
any amendments thereto). The Company shall deduct the Registration Fees from the
funds transferred to VW on the Buyback Closing Date as provided in Section
3.2(b); provided however, if this Agreement or the Underwriting Agreement is
terminated, VE shall pay the Registration Fees to the Company in immediately
available funds within 15 days of such termination.
SECTION 3-THE BUYBACK
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3.1 Purchase and Sale of Shares. On the terms and subject to the
conditions, and in reliance on the representations and warranties, set forth
herein, at the Buyback Closing, VW shall sell and transfer to the Company, and
the Company shall purchase from VW, 2,500,000 shares of the Common Stock (as
adjusted for any reorganization, recapitalization, reclassification, stock
dividend, stock split or combination, or any other changes to the capital
structure of the Company, and as such number of shares may be reduced pursuant
to Section 3.3 below, the "Buyback Shares") at a cash purchase price per share
equal to the purchase price per share offered to the public in connection with
the Public Sale (the "Purchase Price").
3.2 Closing; Delivery and Payment.
(a) The Buyback Closing shall take place at the offices of ▇▇▇▇▇▇,
▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, or at such
other place as VW and the Company shall agree, at 9:00 a.m. (local time) on, (i)
if the over-allotment option described in Section 2(d) of the Underwriting
Agreement is exercised, the later of (A) the date of the closing of such
over-allotment option and (B) the 30th day following the Public Closing Date
(unless such day is not a Business Day, in which case the Buyback Closing Date
shall be on the next succeeding Business Day) or as soon thereafter as
practicable after the conditions set forth in Section 5 have been satisfied or
(ii) if the over-allotment option described in Section 2(d) of the Underwriting
Agreement is not exercised, the 30th day following the Public Closing Date
(unless such day is not a Business Day, in which case the Buyback Closing Date
shall be on the next succeeding Business Day) or as soon thereafter as
practicable after the conditions set forth in Section 5 have been satisfied.
(b) On the Buyback Closing Date, VW shall deliver to the Company such
instruments of transfer, in form and substance reasonably satisfactory to the
Company, as shall be sufficient to transfer the Buyback Shares to the Company,
and in exchange therefor (and upon receipt of confirmation from the Company's
transfer agent of its receipt of the instruments of transfer to be delivered to
it), the Company shall pay to VW in immediately available funds to the
account(s) designated by VW, an amount equal to (i) the aggregate Purchase Price
for the Buyback Shares plus (ii) the amount of the Underwriting Commission Fees
(as defined in Section 3.3), if any, minus (iii) the sum of (A) the amount of
the Registration Fees (as defined in Section 2.4) plus (B) the amount of the
Pre-registration Expenses (as defined in Section 8.1).
(c) At the Buyback Closing, counsel to VW shall deliver its opinion to
the Company as to the matters set forth in Sections 4.1(a) and 4.3(ii) and
(iii), in form and substance substantially similar to the enforceability and
conveyance opinions delivered by such counsel in connection with the
Underwriting Agreement, and dated as of the Buyback Closing Date.
(d) At the Buyback Closing, counsel to the Company shall deliver its
opinion to VW, as to the matters set forth in Section 4.1(a), in form and
substance substantially similar to the enforceability opinion delivered by such
counsel in connection with the Underwriting Agreement, and dated as of the
Buyback Closing Date.
3.3 Over-allotment Shares. Any shares of the Common Stock purchased by the
underwriters of the Public Sale pursuant to the exercise of the over-allotment
option described in Section 2(d) of the Underwriting Agreement (the
"Over-allotment Shares") shall reduce, on a one-for-one basis, the number of
Buyback Shares that the Company is required to purchase at the Buyback Closing.
The Company shall pay to VW on the Buyback Closing Date, in the manner provided
in Section 3.2(b), an amount equal to 50% of the aggregate amount of
underwriting discounts and commissions paid by VW or deducted by the
underwriters of the Public Sale in connection with the purchase of the
Over-allotment Shares (the "Underwriting Commission Fees").
SECTION 4-REPRESENTATIONS AND WARRANTIES
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4.1 By the Parties. Each of VE, VW and VNAC represents and warrants to the
Company, and the Company represents and warrants to VE, VW and VNAC, as follows:
(a) It has all necessary authority for the execution, delivery and
performance of this Agreement by it; it has duly executed and delivered this
Agreement; and this Agreement is a valid and legally binding agreement,
enforceable against it in accordance with its terms, assuming the due execution
and delivery by the other parties; and
(b) The performance of this Agreement by it will not violate or
conflict with any law, regulation, order or agreement, or, to the extent
applicable, such party's charter or organizational documents, and such party is
not required to obtain any governmental approvals or third party consents to
enter into and perform its obligations pursuant to this Agreement. Such
execution and performance does not and will not constitute a default under any
agreement or obligation binding on it or result in the forfeiture or loss of any
rights or assets by it except as specifically provided for in this Agreement.
4.2 By the Company, VW and VNAC. The Company represents to VW and VNAC and
each of VW and VNAC represents to the Company that the Underwriting Agreement,
when executed and delivered, will be a valid and legally binding agreement,
enforceable against it in accordance with its terms, assuming the due execution
and delivery by the other parties.
4.3 By VW. VW represents and warrants to the Company that (i) it is the
beneficial owner of 10,334,221 shares of the Common Stock (the "VW Shares") and
owns no other shares of the Common Stock, (ii) the Buyback Shares are owned, and
will at the Buyback Closing be conveyed to the Company by VW, free and clear of
any liens, charges or encumbrances, (iii) upon delivery of the Buyback Shares,
and payment therefor pursuant hereto, good and valid title to the Buyback Shares
will pass to the Company, (iv) the VW Shares included in the Option Shares (as
defined in Section 6.2) (if any) are owned, and will on the date of any closing
with respect to the Option Shares (if any) be conveyed to the Company by VW,
free and clear of any liens, charges or encumbrances and (v) upon delivery of
the VW Shares included in the Option Shares (if any), and payment therefor
pursuant hereto, good and valid title to the VW Shares included in the Option
Shares (if any) will pass to the Company.
4.4 By VNAC. VNAC represents and warrants to the Company that (i) it is the
beneficial owner of 761,654 shares of the Common Stock (the "VNAC Shares") and
owns no other shares of the Common Stock, (ii) the VNAC Shares included in the
Option Shares (if any) are owned, and will on the date of any closing with
respect to the Option Shares (if any) be conveyed to the Company by VNAC, free
and clear of any liens, charges or encumbrances and (iii) upon delivery of the
VNAC Shares included in the Option Shares (if any), and payment therefor
pursuant hereto, good and valid title to the VNAC Shares included in the Option
Shares (if any) will pass to the Company.
4.5 By VE. VE represents and warrants to the Company that, except to the
extent it may be deemed to be the beneficial owner of the VW Shares and the VNAC
Shares, it owns no shares of the Common Stock.
4.6 By the Company. As of the date it became effective under the Securities
Act, the Registration Statement contained, and the prospectus contained therein
(the "Prospectus") and any amendments or supplements thereto will contain, as of
the date the Prospectus or any such amendment or supplement is filed with the
Securities and Exchange Commission (the "Commission"), all statements which are
required to be stated therein by, and will conform in all material respects to,
the requirements of the Securities Act and the rules and regulations of the
Commission thereunder. The documents incorporated, or to be incorporated, by
reference in the Prospectus, at the time they became effective or were or will
be filed with the Commission, conformed or will conform, as the case may be, in
all material respects, to the requirements of the Exchange Act or the Securities
Act, as applicable, and the rules and regulations of the Commission thereunder.
The Registration Statement and any amendment thereto will not contain, as of the
date it becomes effective, any untrue statement of a material fact and will not
omit to state any material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading. The Prospectus and any amendments and supplements thereto,
as of the date the Prospectus or any such amendment or supplement is filed with
the Commission, will not contain any untrue statement of material fact and will
not omit to state any material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading; provided however, that the Company makes no
representations or warranties as to the information contained in or omitted from
the Registration Statement or the Prospectus, or any such amendment or
supplement, in reliance upon, and in conformity with, written information
furnished to the Company by or on behalf of VE, VW or VNAC or any underwriter
set forth in the Underwriting Agreement, specifically for use in the preparation
thereof.
4.7 No Other Warranties. Except as expressly set forth in this Agreement,
no party is relying on any express or implied representations or warranties
relating to any party or to the consummation of the transactions contemplated
hereby. Except as and to the extent expressly set forth in this Agreement, each
party hereto hereby disclaims all liability and responsibility for any statement
or information made or communicated (orally or in writing) to any other party
hereto or any affiliate, representative or agent thereof (including without
limitation any opinion, information or advice by any officer, director,
consultant, affiliate, representative or agent of the disclaiming party).
SECTION 5-CONDITIONS TO THE PARTIES' OBLIGATIONS TO CONSUMMATE THE BUYBACK
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5.1 Conditions to the Obligations of VW to Consummate the Buyback. The
obligation of VW to consummate the Buyback is subject to the satisfaction (or
waiver) of the following conditions:
(a) No Injunctions. There shall not be in effect any statute,
regulation, order, decree or judgment of any Governmental Entity that makes
illegal or enjoins or prevents in any material respect the consummation of the
transactions contemplated by this Agreement.
(b) Representations. All representations made by the Company in Section
4 hereof shall be true and correct in all material respects at and as of the
Buyback Closing Date.
(c) The Public Sale. The Public Closing shall have occurred.
(d) Legal Opinion. The legal opinion referred to in Section 3.2(d)
shall have been delivered to VW.
5.2 Conditions to the Obligations of the Company to Consummate the Buyback.
The obligation of the Company to consummate the Buyback is subject to the
satisfaction (or waiver) of the following conditions:
(a) No Injunctions. There shall not be in effect any statute,
regulation, order, decree or judgment of any Governmental Entity that makes
illegal or enjoins or prevents in any material respect the consummation of the
transactions contemplated by this Agreement.
(b) Representations. All representations made by VE, VW and VNAC in
Section 4 hereof shall be true and correct in all material respects at and as of
the Buyback Closing Date.
(c) The Public Sale. The Public Closing shall have occurred.
(d) Legal Opinion. The legal opinion referred to in Section 3.2(c)
shall have been delivered to the Company.
SECTION 6-COVENANTS
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6.1 Restrictions on Sale of Securities. VE, VW and VNAC and the Company
agree that the provisions contained in Sections 4(b)(i) and 4(a)(viii) of the
Underwriting Agreement regarding restrictions on the sale of securities of the
Company by VE, VW and VNAC and the Company, respectively, shall apply as of the
date hereof until the earlier to occur of (i) the termination of this Agreement
and (ii) the expiration of such restrictions in accordance with the terms of the
Underwriting Agreement.
6.2 Unsold Registered Shares.
(a) Each of VW and VNAC hereby grants to the Company an option to
purchase at a cash purchase price per share equal to the Purchase Price any or
all of the Subject Shares that are not sold in the Public Sale (the "Option").
"Subject Shares" shall mean the number of shares of the Common Stock held by VW
and VNAC after the Public Closing Date other than the Buyback Shares.
(b) The Company's right to exercise the Option is subject to the
condition that the Public Closing occur.
(c) The Option may be exercised by the Company at any time within 30
days following the Public Closing Date. In the event the Company wishes to
exercise the Option, the Company shall send a written notice to VW and VNAC ,
with a copy to VE (the "Option Exercise Notice"), specifying the total number of
Subject Shares it wishes to purchase (the "Option Shares"); provided that the
Option Exercise Notice is delivered no later than three Business Days prior to
the Option Closing Date. The closing of such purchase (the "Option Closing")
shall take place on the Buyback Closing Date (the "Option Closing Date").
(d) On the Option Closing Date, VW and VNAC shall deliver to the
Company such instruments of transfer, in form and substance reasonably
satisfactory to the Company, as shall be sufficient to transfer the Option
Shares to the Company, and in exchange therefor (and upon receipt of
confirmation from the Company's transfer agent of its receipt of the instruments
of transfer to be delivered to it) the Company shall pay to VW and VNAC the
aggregate Purchase Price for the Option Shares in immediately available funds to
the account(s) designated by VW and VNAC.
(e) At the Option Closing, counsel to VW and VNAC shall deliver its
opinion to the Company as to the matters set forth in Sections 4.3(iv) and (v)
and Sections 4.4 (ii) and (iii), in form and substance substantially similar to
the conveyance opinion delivered by such counsel in connection with the
Underwriting Agreement, and dated as of the Option Closing Date
(f) The Option Closing shall take place at the offices of ▇▇▇▇▇▇, ▇▇▇▇▇
& Bockius LLP, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, or at such other
place as VW, VNAC and the Company shall agree, at 9:00 a.m. (local time) on the
Option Closing Date.
SECTION 7-TERMINATION
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7.1 Termination. This Agreement may be terminated at any time prior to the
Buyback Closing:
(a) by written agreement of VE, VW, VNAC and the Company;
(b) either by VE, VW and VNAC or by the Company, by written notice of
such termination to the other, if the Underwriting Agreement has not been
executed on or prior to 6:00 p.m. Eastern Standard time on September 30, 2002;
(c) either by VE, VW and VNAC or by the Company if any court of
competent jurisdiction or other competent Governmental Entity shall have by
statute, rule, regulation, order, decree or injunction or other action
permanently restrained, enjoined or otherwise prohibited any of the transactions
contemplated by this Agreement.
7.2 Effect of Termination. In the event of termination of this Agreement by
either the Company or VE as provided in Section 7.1, this Agreement will
forthwith become void and have no effect, other than the provisions of Sections
2.3 and 2.4, which provisions shall survive such termination.
SECTION 8-MISCELLANEOUS
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8.1 Pre-Registration Expenses. VE will reimburse the Company for the fees
and disbursements of the Company's legal counsel (up to a maximum amount of
$60,000) billed in connection with legal services rendered prior to April 1,
2002 in evaluating VE's proposals regarding potential transactions involving the
shares of the Common Stock held by VW and VNAC (the "Pre-registration Legal
Expenses"). VE will reimburse the Company for up to $20,000 of expenses billed
by UBS Warburg LLC in connection with its engagement by the Company (together
with the Pre-registration Legal Expenses, the "Pre-registration Expenses"). The
Company shall deduct the Pre-registration Expenses from the funds transferred to
VW on the Buyback Closing Date as provided in Section 3.2(b).
8.2 Notices. All notices or other communications hereunder shall be deemed
to have been duly given and made if in writing and if served by personal
delivery upon the party for whom it is intended, if delivered registered or
certified mail, return receipt requested, or by a national or international
courier service, if sent by facsimile transmission, provided that the facsimile
transmission is promptly confirmed by telephone confirmation thereof, or on the
third day after posting in the United States postage prepaid if sent by
registered or certified mail, return receipt requested, to the person at the
address set forth below, or such other address as may be designated in writing
hereafter, in the same manner, by such person:
To the Company:
Philadelphia Suburban Corporation
▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇, Esq.
Executive Vice President and General Counsel
Fax: ▇▇▇.▇▇▇.▇▇▇▇
with a copy to:
▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Fax: ▇▇▇.▇▇▇.▇▇▇▇
To VE, VW or VNAC:
Vivendi Environnement S.A.
▇▇-▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇ Contamine
Fax: (+33.1)71.75.10.09
Vivendi Water S.A.
▇▇, ▇▇▇ ▇'▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Fax: (+33.1) 49.24.69.11
Vivendi North America Company
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ Contamine
Fax: (+33.1) 71.75.10.09
with a copy to:
Cleary, Gottlieb, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇, ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Fax: (+33.1) 45.63.66.37
8.3 Amendment; Waiver. Any provision of this Agreement may be amended or
waived if, and only if, such amendment or waiver is in writing and signed, in
the case of any amendment, by the parties hereto, or in the case of a waiver, by
the party against whom the waiver is to be effective. No failure or delay by any
party in exercising any right, power or privilege hereunder shall operate as a
waiver thereof nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies herein provided shall be cumulative and,
except as otherwise provided herein, shall not be exclusive of any rights or
remedies provided by law.
8.4 Assignment. No party to this Agreement may assign any of its rights or
obligations under this Agreement without the consent of the other party hereto.
8.5 Entire Agreement. This Agreement (which includes the Exhibit hereto)
contains the entire agreement among the parties hereto with respect to the
subject matter hereof and supersedes all prior agreements and understandings,
oral or written, between or among them with respect to such matters, and any
written agreement of the parties that expressly provides that it is not
superseded by this Agreement.
8.6 Parties in Interest. This Agreement shall inure to the benefit of and
be binding upon the parties hereto and their respective successors and permitted
assigns. Except as expressly set forth herein, nothing in this Agreement,
express or implied, is intended to confer upon any person other than the parties
hereto, and their successors or permitted assigns, any rights or remedies under
or by reason of this Agreement.
8.7 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK (without reference to its rules as to conflicts of laws).
8.8 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, and all of which shall
constitute one and the same Agreement.
8.9 Access to Information. From the date hereof until the Public Closing
Date, the Company shall give VE and the Representatives (as defined in the
Underwriting Agreement) of the prospective underwriters in respect of the Public
Sale, and their respective accountants, attorneys, consultants, agents and other
representatives such access as may reasonably be requested, during normal
business days and working hours, to senior management and other appropriate
parties, and to appropriate records and documents to permit a customary due
diligence investigation of the Company's business and affairs and evaluate the
accuracy and completeness of the information set forth in the Registration
Statement. Any information obtained by VE as a result of such access shall be
used solely for the purpose of satisfying such due diligence investigation. Any
investigation pursuant to this Section shall be conducted in such manner as not
to interfere unreasonably with the conduct of the business of the Company.
8.10 Further Assurances. Each party hereto shall take such actions and
execute and deliver such other documents, certifications and further assurances
as the other party hereto may reasonably request in order to carry out the
purposes of this Agreement. In furtherance of the foregoing, the Company will
make available, at locations selected by UBS Warburg LLC and Deutsche Bank
Securities Inc., as representatives of the underwriters of the Public Sale,
including locations in Europe if requested, its chief executive officer, its
chief financial officer and its advisors, upon reasonable advance notice, for
meetings with prospective purchasers of the Registered Shares and for road show
presentations regarding the Company's business.
8.11 Public Announcement. Except to the extent required by law or stock
exchange rule (and then only after prior notice to and consultation with the
other), neither VE, VW, VNAC nor the Company nor their respective
representatives will, without the other party's prior written consent, disclose
to any person (other than the persons employed by either VE, VW, VNAC, U.S.
Filter Corp., or the Company or their respective representatives who are
actively and directly participating in the transactions contemplated by this
Agreement) any information about the transactions contemplated by this Agreement
or the terms, conditions or other facts relating thereto, including the fact
that discussions are taking place with respect thereto or the status thereof or
the contents of any proposal with respect thereto.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first written above.
PHILADELPHIA SUBURBAN CORPORATION
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
Title: Chairman and Chief Executive
Officer
VIVENDI ENVIRONNEMENT S.A.
By: /s/ ▇▇▇▇▇▇ Contamine
-------------------------------------
Name: ▇▇▇▇▇▇ Contamine
Title: Chief Financial Officer
VIVENDI WATER S.A.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Chief Financial Officer
VIVENDI NORTH AMERICA COMPANY
By: /s/ ▇▇▇▇▇▇ Contamine
-------------------------------------
Name: ▇▇▇▇▇▇ Contamine
Title: President
EXHIBIT A
8,595,875 Shares
Philadelphia Suburban Corporation
Common Stock
($.50 Par Value)
UNDERWRITING AGREEMENT
----------------------
[ , 2002]
Deutsche Bank Securities Inc.
UBS Warburg LLC
As Representatives of the
several Underwriters
c/o Deutsche Bank Securities Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Certain shareholders named in Schedule II hereto (the "Selling
Shareholders") of Philadelphia Suburban Corporation, a Pennsylvania corporation
(the "Company"), propose to sell to the several underwriters (the
"Underwriters") named in Schedule I hereto for whom you are acting as
representatives (the "Representatives") an aggregate of 8,595,875 shares of the
Company's Common Stock, $.50 par value (the "Firm Shares"). The respective
amounts of the Firm Shares to be so purchased by the several Underwriters are
set forth opposite their names in Schedule I hereto, and the respective amounts
to be sold by the Selling Shareholders are set forth opposite their names in
Schedule II hereto. Vivendi Water S.A. (the "Option Selling Shareholder") also
proposes to sell at the Underwriters' option an aggregate of up to 1,289,381
additional shares of the Company's Common Stock (the "Option Shares") as set
forth below.
As the Representatives, you have advised the Company and the Selling
Shareholders (a) that you are authorized to enter into this Agreement on behalf
of the several Underwriters, and (b) that the several Underwriters are willing,
acting severally and not jointly, to purchase the numbers of Firm Shares set
forth opposite their respective names in Schedule I, plus their pro rata portion
of the Option Shares if you elect to exercise the over-allotment option in whole
or in part for the accounts of the several Underwriters. The Firm Shares and the
Option Shares (to the extent the aforementioned option is exercised) are herein
collectively called the "Shares."
In consideration of the mutual agreements contained herein and of the
interests of the parties in the transactions contemplated hereby, the parties
hereto agree as follows:
1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE SELLING
SHAREHOLDERS.
(a) The Company represents and warrants to each of the Underwriters
and the Selling Shareholders as follows:
(i) A registration statement on Form S-3 (File No. 333-______) with
respect to the Shares has been prepared by the Company in conformity with the
requirements of the Securities Act of 1933, as amended (the "Act"), and the
rules and regulations (the "Rules and Regulations") of the Securities and
Exchange Commission (the "Commission") thereunder and has been filed with the
Commission. The Company and the offering and sale of the Shares contemplated by
this Agreement meet the requirements and comply with the conditions for the use
of Form S-3. Copies of such registration statement, including any amendments
thereto, the preliminary prospectuses (meeting the requirements of the Rules and
Regulations) contained therein and the exhibits, financial statements and
schedules, as finally amended and revised, have heretofore been delivered by the
Company to you or your representatives or are publicly available in accordance
with the Rules and Regulations. Such registration statement, together with any
registration statement filed by the Company pursuant to Rule 462 (b) of the Act,
is herein referred to as the "Registration Statement," which shall be deemed to
include all information omitted therefrom in reliance upon Rule 430A and
contained in the Prospectus referred to below, has become effective under the
Act and no post-effective amendment to the Registration Statement has been filed
as of the date of this Agreement. "Prospectus" means the form of prospectus
first filed with the Commission pursuant to Rule 424(b). Each preliminary
prospectus included in the Registration Statement prior to the time the
Registration Statement becomes effective is herein referred to as a "Preliminary
Prospectus." Any reference herein to the Registration Statement, any Preliminary
Prospectus or to the Prospectus or to any amendment or supplement to any of the
foregoing documents shall be deemed to refer to and include any documents
incorporated by reference therein, and, in the case of any reference herein to
any Prospectus, also shall be deemed to include any documents incorporated by
reference therein, and any supplements or amendments thereto, filed with the
Commission after the date of filing of the Prospectus under Rules 424(b) or
430A, and prior to the termination of the offering of the Shares by the
Underwriters.
(ii) The Company has been duly organized and is validly existing as
a corporation in good standing under the laws of the Commonwealth of
Pennsylvania, with corporate power and authority to own or lease its properties
and conduct its business as described in the Registration Statement. Each of the
significant subsidiaries of the Company as listed on Schedule III (collectively,
the "Subsidiaries") has been duly organized and is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, with corporate power and authority to own or lease its properties
and conduct its business as described in the Registration Statement. The Company
and each of the Subsidiaries are duly qualified to transact business in all
jurisdictions in which the conduct of their business requires such
qualification, except for such jurisdictions where the failure to so qualify
would not have a material adverse effect on the earnings, business, management,
properties, assets, rights, operations or condition (financial or otherwise) of
the Company and of the Subsidiaries taken as a whole (a "Material Adverse
Effect"). The outstanding shares of capital stock of each of the Subsidiaries
have been duly authorized and validly issued, are fully paid and non-assessable
and are owned by the Company or another Subsidiary free and clear of all liens,
encumbrances and equities and claims; and no options, warrants or other rights
to purchase, agreements or other obligations to issue or other rights to convert
any obligations into shares of capital stock or ownership interests in the
Subsidiaries are outstanding, other than those described in the Registration
Statement or described in any document incorporated by reference therein.
(iii) The outstanding shares of Common Stock of the Company,
including all shares to be sold by the Selling Shareholders, have been duly
authorized and validly issued and are fully paid and non-assessable and no
preemptive rights of shareholders exist with respect to any of the Shares or the
issue and sale thereof, other than those described in the Registration Statement
or described in any document incorporated by reference therein. Neither the
filing of the Registration Statement nor the offering or sale of the Shares as
contemplated by this Agreement gives rise to any rights, other than those which
have been waived or satisfied, for or relating to the registration of any shares
of Common Stock.
(iv) All of the Shares conform in all material respects to the
description thereof contained in or incorporated by reference in the
Registration Statement. The form of certificates for the Shares conforms to the
corporate law of the jurisdiction of the Company's incorporation.
(v) The Commission has not issued an order preventing or suspending
the use of any Prospectus relating to the proposed offering of the Shares nor
instituted proceedings for that purpose. As of the date it became effective
under the Act, the Registration Statement contained, and the Prospectus and any
amendments or supplements thereto will contain, as of the date the Prospectus,
such amendment or supplement is filed with the Commission, all statements which
are required to be stated therein by, and conforms to, or will conform to, as
the case may be, the requirements of the Act and the Rules and Regulations. The
documents incorporated, or to be incorporated, by reference in the Prospectus,
at the time they became effective or were or will be filed with the Commission
as the case may be, conformed or will conform, as the case may be, in all
material respects to the requirements of the Securities Exchange Act of 1934
("Exchange Act") or the Act, as applicable, and the rules and regulations of the
Commission thereunder. The Registration Statement did not, as of the date it
became effective, contain and any amendment thereto will not contain, any untrue
statement of a material fact and did not omit, and will not omit, to state any
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading. The Prospectus and any amendments and supplements thereto, as of the
date the Prospectus, such amendment or supplement is filed with the Commission
do not contain, and will not contain, any untrue statement of material fact; and
do not omit and will not omit, to state any material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however,
that the Company makes no representations or warranties as to information
contained in or omitted from the Registration Statement or the Prospectus, or
any such amendment or supplement, in reliance upon, and in conformity with,
written information furnished to the Company by or on behalf of any Underwriter
through the Representatives or the Selling Shareholders, specifically for use in
the preparation thereof.
(vi) The consolidated financial statements of the Company and the
Subsidiaries, together with related notes and schedules as set forth or
incorporated by reference in the Registration Statement, present fairly in all
material respects the financial position and the results of operations and cash
flows of the Company and the consolidated Subsidiaries, at the indicated dates
and for the indicated periods. Such financial statements and related schedules
have been prepared in accordance with generally accepted principles of
accounting, consistently applied throughout the periods involved, except as
disclosed therein in all material respects, and all adjustments necessary for a
fair presentation of results for such periods have been made. The summary
financial and statistical data included or incorporated by reference in the
Registration Statement presents fairly in all material respects the information
shown therein and such data has been compiled on a basis consistent with the
financial statements presented therein and the books and records of the company.
(vii) PricewaterhouseCoopers LLP, who have certified certain of the
financial statements filed with the Commission as part of, or incorporated by
reference in, the Registration Statement, are independent public accountants as
required by the Act and the Rules and Regulations. KPMG LLP, who have certified
the financial statements for fiscal year 1999 filed with the Commission as part
of, or incorporated by reference in, the Registration Statement, are independent
public accountants as required by the Act and the Rules and Regulations.
(viii) There are no legal or governmental proceedings pending to
which the Company or the Subsidiaries is a party or of which any property of the
Company or the Subsidiaries is the subject that are required to be disclosed in
the Registration Statement that are not so disclosed as required; and to the
Company's knowledge, no such proceedings are threatened or contemplated.
(ix) Each of the Company and the Subsidiaries has good and
marketable title to all of their respective properties and assets reflected in
the consolidated financial statements hereinabove described except where the
failure to have such title would not have a Material Adverse Effect, subject to
no lien, mortgage, pledge, charge or encumbrance of any kind except those
reflected in such financial statements or described in the Registration
Statement or which are not material in amount. Each of the Company and the
Subsidiaries occupies their leased properties under valid and existing leases,
with only such exceptions with respect to any particular lease as do not
interfere in any material respect with the conduct of the business of the
Company.
(x) Each of the Company and the Subsidiaries has filed all material
Federal, State, local and foreign tax returns, or have filed for extensions of
the due dates for such returns which have been required to be filed and have
paid all taxes indicated by such returns and all assessments received by them or
any of them to the extent that such taxes have become due, or has received
timely extensions thereof, other than any taxes which the Company or any
Subsidiary is contesting in good faith. The Company does not know of any actual
or proposed additional material tax assessments.
(xi) Since the respective dates as of which information is given or
incorporated by reference in the Registration Statement, as it may be amended or
supplemented, except as described therein or in such incorporated information,
there has not been any change or any development that has had or will have a
Material Adverse Effect, whether or not occurring in the ordinary course of
business, and there has not been any material transaction entered into by the
Company or the Subsidiaries, other than transactions in the ordinary course of
business and changes and transactions described in the Registration Statement,
as it may be amended or supplemented. Each of the Company and the Subsidiaries
has no material contingent obligations which are not disclosed in the Company's
financial statements which are included in the Registration Statement.
(xii) Neither the Company nor any of the Subsidiaries is or with the
giving of notice or lapse of time or both, will be, in violation of or in
default under (i) its Charter or By-Laws, or (ii) under any agreement, lease,
contract, indenture or other instrument or obligation to which it is a party or
by which it, or any of its properties, is bound and, solely with respect to this
clause (ii), which violation or default would have a Material Adverse Effect.
The execution and delivery of this Agreement and the consummation of the
transactions herein contemplated and the fulfillment of the terms hereof will
not conflict with or result in a breach of any of the terms or provisions of, or
constitute a default under, any material indenture, mortgage, deed of trust or
other material agreement or instrument to which the Company or any Subsidiary is
a party or by which the Company or any Subsidiary or any of their respective
properties is bound, or of the Charter or By-Laws of the Company or any law,
order, rule or regulation judgement, order, writ or decree applicable to the
Company or any Subsidiary of any court or of any government, regulatory body or
administrative agency or other governmental body having jurisdiction, except
where such breach or default would not, except with respect to the Charter or
By-laws individually or in the aggregate, have a Material Adverse Effect.
(xiii) The execution and delivery of, and the performance by the
Company of its obligations under, this Agreement has been duly and validly
authorized by all necessary corporate action on the part of the Company, and
this Agreement has been duly executed and delivered by the Company.
(xiv) Each approval, consent, order, authorization, designation,
declaration or filing by or with any regulatory, administrative or other
governmental body necessary in connection with the execution and delivery by the
Company of this Agreement and the consummation of the transactions herein
contemplated (except such additional steps as may be required by the Commission,
the National Association of Securities Dealers, Inc. (the "NASD") or such
additional steps as may be necessary to qualify the Shares for public offering
by the Underwriters under state securities or Blue Sky laws) has been obtained
or made and is in full force and effect.
(xv) Each of the Company and the Subsidiaries holds, has obtained or
meets the requirements for all material licenses, certificates and permits,
consents, orders, approvals and other authorizations from governmental
authorities which are necessary to the conduct of their businesses and has made
all declarations and filings with, all federal, state, local and other
governmental authorities (including foreign regulatory agencies), all
self-regulatory organizations and all courts and other tribunals, domestic or
foreign, necessary to own or lease, as the case may be, and to operate its
properties and to carry on its business as conducted as of the date hereof,
except where the lack thereof would not have a Material Adverse Effect, and
neither the Company nor any such subsidiary has received any actual written
notice of any proceeding relating to revocation or modification of any such
material license, permit, certificate, consent, order, approval or other
authorization that would materially interfere with its ownership or lease, as
the case may be, or the operation of its properties or the carrying on of its
business as conducted on the date hereof, except as described in the
Registration Statement and the Prospectus; and each of the Company and its
subsidiaries is in material compliance with all laws and regulations relating to
the conduct of its business as conducted as of the date hereof, except where
such noncompliance would not have a Material Adverse Effect.
(xvi) Neither the Company, nor to the Company's knowledge, any of
its affiliates, has taken or may take, directly or indirectly, any action
designed to cause or result in, or which has constituted or which might
reasonably be expected to constitute, the stabilization or manipulation of the
price of the shares of Common Stock to facilitate the sale or resale of the
Shares.
(xvii) Neither the Company nor any Subsidiary is an "investment
company" or an entity "controlled" by an "investment company" within the meaning
of such terms under the Investment Company Act of 1940, (as amended, the "1940
Act") and the rules and regulations of the Commission thereunder.
(xviii) The Company and each of its Subsidiaries maintains a system
of internal accounting controls sufficient to provide reasonable assurances that
in all material respects (i) transactions are executed in accordance with
management's general or specific authorization; (ii) transactions are recorded
as necessary to permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain accountability for
assets; (iii) access to assets is permitted only in accordance with management's
general or specific authorization; and (iv) the recorded accountability for
assets is compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(xix) The Company and each of its Subsidiaries carry, or are covered
by, insurance in such amounts and covering such risks relative to the conduct of
their respective businesses as currently conducted and the value of their
respective properties and as is reasonable and customary for companies engaged
in similar businesses.
(xx) There are no existing or, to the best knowledge of the Company,
threatened labor disputes with the employees of the Company or any of the
Subsidiaries which are likely to have a Material Adverse Effect.
(xxii) Except as described in the Registration Statement or any of
the documents incorporated by reference therein, the Company and each of its
subsidiaries (i) are in compliance with any and all applicable foreign, federal,
state and local laws and regulations relating to the protection of human health
and safety, the environment or hazardous or toxic substances or wastes,
pollutants or contaminants ("Environmental Laws"), (ii) have received or meets
the requirements for all material permits, licenses or other approvals required
of them under applicable Environmental Laws to conduct their respective
businesses and (iii) are in compliance with all terms and conditions of any such
permit, license or approval, except where such noncompliance with Environmental
Laws, failure to receive required permits, licenses or other approvals or
failure to comply with the terms and conditions of such permits, licenses or
approvals would not, singly or in the aggregate, have a Material Adverse Effect.
Except as described in the Registration Statement or any of the documents
incorporated by reference therein, there are no legal or governmental
proceedings pending or, to the knowledge of the Company, threatened against or
affecting the Company or any of its Subsidiaries under any Environmental Law
which, individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
(xxiv) In the ordinary course of its business, the Company reviews
of the effect of Environmental Laws on the business, operations and properties
of the Company and each of its subsidiaries, in the course of which it
identifies and evaluates associated costs and liabilities (including, without
limitation, any capital or operating expenditures required for clean-up, closure
of properties or compliance with Environmental Laws or any permit, license or
approval, any related constraints on operating activities and any potential
liabilities to third parties). Except as described in the Registration Statement
or any of the documents incorporated by reference therein, on the basis of such
review, the Company has reasonably concluded that such associated costs and
liabilities would not, singly or in the aggregate, have a Material Adverse
Effect.
(b) Each of the Selling Shareholders severally represents and warrants
as follows:
(i) Such Selling Shareholder now has and at the Closing Date and the
Option Closing Date, as the case may be (as such dates are hereinafter defined)
will have good and marketable title to the Firm Shares and the Option Shares to
be sold by such Selling Shareholder, free and clear of any liens, encumbrances,
equities and claims, and full right, power and authority to effect the sale and
delivery of such Firm Shares and Option Shares; and upon the delivery of,
against payment for, such Firm Shares and Option Shares pursuant to this
Agreement, the Underwriters will acquire good and marketable title thereto, free
and clear of any liens, encumbrances, equities and claims.
(ii) Such Selling Shareholder has full right, power and authority to
execute and deliver this Agreement and to perform its obligations under this
Agreement. The execution and delivery of this Agreement and the consummation by
such Selling Shareholder of the transactions herein contemplated and the
fulfillment by such Selling Shareholder of the terms hereof will not require any
consent, approval, authorization, or other order of any court, regulatory body,
administrative agency or other governmental body (except as may be required
under the Act, state securities laws or Blue Sky laws) and will not result in a
breach of any of the terms and provisions of, or constitute a default under,
organizational documents of such Selling Shareholder, or any indenture,
mortgage, deed of trust or other agreement or instrument to which such Selling
Shareholder is a party, or of any order, rule or regulation applicable to such
Selling Shareholder of any court or of any regulatory body or administrative
agency or other governmental body having jurisdiction.
(iii) Such Selling Shareholder has not taken and will not take,
directly or indirectly, any action designed to, or which has constituted, or
which might reasonably be expected to cause or result in the stabilization or
manipulation of the price of the Common Stock of the Company and, other than as
permitted by the Act, such Selling Shareholder will not distribute any
prospectus or other offering material in connection with the offering of the
Shares.
(iv) Without having undertaken to determine independently the
accuracy or completeness of either the representations and warranties of the
Company contained herein or the information contained in the Registration
Statement, such Selling Shareholder has no reason to believe that the
representations and warranties of the Company contained in this Section 1 are
not true and correct, is familiar with the Registration Statement and has no
knowledge of any material fact, condition or information not disclosed in the
Registration Statement which has adversely affected or may adversely affect the
business of the Company or any of the Subsidiaries; and the sale of the Firm
Shares and the Option Shares by such Selling Shareholder pursuant hereto is not
prompted by any information concerning the Company or any of the Subsidiaries
which is not set forth in the Registration Statement or the documents
incorporated by reference therein. The information pertaining to such Selling
Shareholder under the caption "Selling Shareholders" in the Prospectus is
complete and accurate in all material respects.
2. PURCHASE, SALE AND DELIVERY OF THE FIRM SHARES.
(a) On the basis of the representations, warranties and covenants
herein contained, and subject to the conditions herein set forth, the Selling
Shareholders agree to sell to the Underwriters and each Underwriter agrees,
severally and not jointly, to purchase, at a net purchase price of $_____ per
share (representing the public offering price of $___ per share less
underwriting discounts and commissions of $___ per share), the number of Firm
Shares set forth opposite the name of each Underwriter in Schedule I hereof,
subject to adjustments in accordance with Section 9 hereof. The number of Firm
Shares to be purchased by each Underwriter from each Seller shall be as nearly
as practicable in the same proportion to the total number of Firm Shares being
sold by each Seller as the number of Firm Shares being purchased by each
Underwriter bears to the total number of Firm Shares to be sold hereunder. The
obligations of each of the Selling Shareholders shall be several and not joint.
(b) Payment for the Firm Shares to be sold hereunder is to be made
in Federal (same day) funds to an account designated by each Selling Shareholder
for the shares to be sold by such Selling Shareholder, in each case against
delivery of the Firm Shares therefor to the Representatives for the several
accounts of the Underwriters. Such payment and delivery are to be made through
the facilities of The Depository Trust Company, New York New York ("DTC") at
10:00 a.m., New York time, on the third business day after the date of this
Agreement or at such other time and date not later than five business days
thereafter as you and the Company shall agree upon, such time and date being
herein referred to as the "Closing Date." (As used herein, "business day" means
a day on which the New York Stock Exchange is open for trading and on which
banks in New York are open for business and not permitted by law or executive
order to be closed.)
(c) In addition, on the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Option Selling Shareholder hereby grants an option to the several Underwriters
to purchase the Option Shares at the price per share as set forth in the first
paragraph of this Section 2. No Option Shares shall be sold or delivered by the
Underwriters unless the Firm Shares previously have been, or simultaneously with
the Option Shares are, sold and delivered. The option granted hereby may be
exercised in whole or in part by giving written notice (i) at any time before
the Closing Date and (ii) only once thereafter within 30 days after the date of
this Agreement, by you, as Representatives of the several Underwriters, to the
Selling Shareholders and the Company setting forth the number of Option Shares
as to which the several Underwriters are exercising the option and the time and
date at which such Option Shares are to be delivered. The time and date at which
the Option Shares are to be delivered shall be determined by the Representatives
but shall not be later than three full business days after written notice of the
exercise of such option, nor in any event prior to the Closing Date (such time
and date being herein referred to as the "Option Closing Date"). If the date of
exercise of the option is three or more days before the Closing Date, the notice
of exercise shall set the Closing Date as the Option Closing Date. The number of
Option Shares to be purchased by each Underwriter shall be in the same
proportion to the total number of Option Shares being purchased as the number of
Firm Shares being purchased by such Underwriter bears to the total number of
Firm Shares, adjusted by you in such manner as to avoid fractional shares. The
option with respect to the Option Shares granted hereunder may be exercised only
to cover over-allotments in the sale of the Firm Shares by the Underwriters.
You, as Representatives of the several Underwriters, may cancel such option at
any time prior to its expiration by giving written notice of such cancellation
to the Selling Shareholders and the Company. To the extent, if any, that the
option is exercised, payment for the Option Shares shall be made on the Option
Closing Date in Federal (same day) funds to an account designated by the Option
Selling Shareholder for the Option Shares to be sold by the Option Selling
Shareholder against delivery of the Option Shares through the facilities of DTC.
3. OFFERING BY THE UNDERWRITERS.
It is understood that the several Underwriters are to make a public
offering of the Firm Shares as soon as the Representatives deem it advisable to
do so. The Firm Shares are to be initially offered to the public at the public
offering price set forth in the Prospectus. The Representatives may from time to
time thereafter change the public offering price and other selling terms. To the
extent, if at all, that any Option Shares are purchased pursuant to Section 2
hereof, the Underwriters will offer them to the public on the foregoing terms.
It is further understood that you will act as the Representatives
for the Underwriters in the offering and sale of the Shares in accordance with a
Master Agreement Among Underwriters entered into by you and the several other
Underwriters.
4. COVENANTS OF THE COMPANY AND THE SELLING SHAREHOLDERS.
(a) The Company covenants and agrees with the several Underwriters
with respect to (i) through (x) below, and with the Selling Shareholders with
respect to (i) through (v) only that:
(i) The Company will (A) use its best efforts to cause the
Registration Statement to become effective or, if the procedure in Rule 430A of
the Rules and Regulations is followed, to prepare and timely file with the
Commission under Rule 424(b) of the Rules and Regulations a Prospectus in a form
approved by the Representatives containing information previously omitted at the
time of effectiveness of the Registration Statement in reliance on Rule 430A of
the Rules and Regulations, and (B) not file any amendment to the Registration
Statement or supplement to the Prospectus or document incorporated by reference
therein of which the Representatives or the Selling Shareholders shall not
previously have been advised and furnished with a copy or to which the
Representatives or the Selling Shareholders shall have reasonably objected in
writing or which is not in compliance with the Rules and Regulations and (C)
file on a timely basis all reports and any definitive proxy or information
statements required to be filed by the Company with the Commission subsequent to
the date of the Prospectus and prior to the termination of the offering of the
Shares by the Underwriters.
(ii) The Company will advise the Representatives and the
Selling Shareholders promptly of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or the use of
the Prospectus or of the institution of any proceedings for that purpose. The
Company will use its best efforts to prevent the issuance of any such stop order
preventing or suspending the use of the Prospectus and to obtain as soon as
possible the lifting thereof, if issued.
(iii) The Company will cooperate with the Representatives and
the Selling Shareholders in endeavoring to qualify the Shares for sale under the
securities laws of such jurisdictions as the Representatives may reasonably have
designated in writing and will make such applications, file such documents, and
furnish such information as may be reasonably required for that purpose,
provided the Company shall not be required to qualify as a foreign corporation
or to file a general consent to service of process in any jurisdiction where it
is not now so qualified or required to file such a consent. The Company will,
from time to time, prepare and file such statements, reports, and other
documents, as are or may be required to continue such qualifications in effect
for so long a period as the Representatives may reasonably request for
distribution of the Shares.
(iv) The Company will deliver to, or upon the order of, the
Representatives, from time to time, as many copies of any Preliminary Prospectus
as the Representatives may reasonably request. The Company will deliver to, or
upon the order of, the Representatives during the period when delivery of a
Prospectus is required under the Act, as many copies of the Prospectus in final
form, or as thereafter amended or supplemented, as the Representatives may
reasonably request. The Company will deliver to each Selling Shareholder one
copy of the Registration Statement including all exhibits filed therein and to
the Representatives such number of copies of the Registration Statement, one of
which will be signed and will include all exhibits filed therewith, and
documents incorporated by reference therein, and of all amendments thereto, as
the Representatives may reasonably request.
(v) Within the time during which a prospectus relating to the
Shares is required to be delivered under the Act, the Company will comply with
the Act and the Rules and Regulations, and the Exchange Act, and the rules and
regulations of the Commission thereunder, so as to permit the completion of the
distribution of the Shares as contemplated in this Agreement and the Prospectus.
If during the period in which a prospectus is required by law to be delivered by
an Underwriter or dealer, any event shall occur as a result of which, in the
judgment of the Company or in the reasonable opinion of the Underwriters or the
Selling Shareholders, it becomes necessary to amend or supplement the Prospectus
in order to make the statements therein, in the light of the circumstances
existing at the time the Prospectus is delivered to a purchaser, not misleading,
or, if it is necessary at any time to amend or supplement the Prospectus to
comply with any law, the Company promptly will either (i) prepare and file with
the Commission an appropriate amendment to the Registration Statement or
supplement to the Prospectus or (ii) prepare and file with the Commission an
appropriate filing under the Exchange Act which shall be incorporated by
reference in the Prospectus so that the Prospectus as so amended or supplemented
will not, in the light of the circumstances when it is so delivered, be
misleading, or so that the Prospectus will comply with the law.
(vi) The Company will make generally available to its security
holders, as soon as it is practicable to do so, but in any event not later than
15 months after the effective date of the Registration Statement, an earning
statement (which need not be audited) in reasonable detail, covering a period of
at least 12 consecutive months beginning after the effective date of the
Registration Statement, which earnings statement shall satisfy the requirements
of Section 11(a) of the Act and Rule 158 of the Rules and Regulations and will
advise you in writing when such statement has been so made available.
(vii) The Company shall not (a) issue, offer, sell, contract to
sell, pledge or otherwise dispose of, directly or indirectly, or file with the
SEC any registration statement relating to, any additional shares of its common
stock or securities convertible into or exchangeable or exercisable for any
shares of its common stock, enter into a transaction which would have the same
effect or publicly disclose the intention to make any such offer, sale, pledge,
disposition or filing, or (b) grant any options whatsoever in respect of its
shares, except grants of employee stock options pursuant to the terms of a plan
in effect on the date of this Agreement, in each case for a period of 90 days
after the date of this Agreement, without the prior written consent of the
Representatives. The foregoing restrictions shall not apply to any registration
statement, or any shares issued thereunder, relating to the Company's proposed
acquisition of Pennichuck Corporation, the issuance by the Company of up to
150,000 Shares under the Company's shelf registration statements or the issuance
of shares under the Company's Dividend Reinvestment and Direct Stock Purchase
Plan.
(viii) The Company has caused each executive officer and
director of the Company to furnish to you, on or prior to the date of this
agreement, a letter or letters, in form and substance satisfactory to the
Underwriters ("Lockup Agreements"), pursuant to which each such person shall
agree not to offer, sell, sell short or otherwise dispose of, directly or
indirectly, any shares of Common Stock of the Company or other capital stock of
the Company, or any other securities convertible, exchangeable or exercisable
for Common Shares or derivative of Common Shares owned by such person or request
the registration for the offer or sale of any of the foregoing (or as to which
such person has the right to direct the disposition of) for a period of 90 days
after the date of this Agreement, directly or indirectly, except with the prior
written consent of the Representatives.
(ix) The Company will maintain a transfer agent and, if
necessary under the jurisdiction of incorporation of the Company, a registrar
for the Common Stock.
(x) The Company will not take, directly or indirectly, any
action designed to cause or result in, or that constitutes or might reasonably
be expected to constitute, the stabilization or manipulation of the price of any
securities of the Company.
(b) Each of the Selling Shareholders covenants and agrees with each
of the several Underwriters that:
(i) Each Selling Shareholder shall not offer, sell, contract to
sell, pledge or otherwise dispose of, directly or indirectly, any additional
shares of the Company's common stock or securities convertible into or
exchangeable or exercisable for any shares of the Company's common stock, enter
into a transaction which would have the same effect or publicly disclose the
intention to make any such offer, sale, pledge, disposition or filing for a
period of 90 days after the date of this Agreement, without the prior written
consent of the Representatives. The foregoing restrictions shall not apply to
the proposed purchase by the Company of 2,500,000 shares from the Selling
Shareholders, as described in the Registration and Share Purchase Agreement
between the Company and the Selling Shareholders.
(ii) In order to document the Underwriters' compliance with the
reporting and withholding provisions of the Tax Equity and Fiscal Responsibility
Act of 1982 and the Interest and Dividend Tax Compliance Act of 1983 with
respect to the transactions herein contemplated, each of the Selling
Shareholders agrees to deliver to you prior to or at the Closing Date a properly
completed and executed United States Treasury Department Form W-8 or W-9 (or
other applicable form or statement specified by Treasury Department regulations
in lieu thereof).
(iii) Such Selling Shareholder 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, the stabilization or manipulation
of the price of any securities of the Company.
5. COSTS AND EXPENSES.
The parties agree that the Underwriters shall not be responsible for
the following expenses (1) accounting fees of the Company; (2) the fees and
disbursements of counsel for the Company and the Selling Shareholders; (3) the
cost of printing and delivering to, or as requested by, the Underwriters copies
of the Registration Statement, Preliminary Prospectuses and the Prospectus, and
any supplements or amendments thereto; (4) the filing fees of the Commission;
(5) the filing fees and expenses (including legal fees and disbursements)
incident to securing any required review by the NASD of the terms of the sale of
the Shares; (6) and the expenses, including the fees and disbursements of
counsel for the Underwriters, incurred in connection with the qualification of
the Shares under State securities or Blue Sky laws. Nothing herein, however,
shall prevent the Company and the Selling Shareholders from apportioning such
costs among themselves under separate agreements. To the extent, if at all, that
any of the Selling Shareholders engage special legal counsel to represent them
in connection with this offering, the fees and expenses of such counsel shall be
borne by such Selling Shareholder. Any transfer taxes imposed on the sale of the
Shares to the several Underwriters will be paid by the Selling Shareholders pro
rata. The Company and the Selling Shareholders shall not, however, be required
to pay for any of the Underwriters' expenses (other than those related to
qualification under NASD regulation and State securities or Blue Sky laws)
except that, if this Agreement shall not be consummated because the conditions
in Section 6 hereof are not satisfied, or because this Agreement is terminated
by the Representatives pursuant to Section 11 hereof, or by reason of any
failure, refusal or inability on the part of the Company or the Selling
Shareholders to perform any undertaking or satisfy any condition of this
Agreement or to comply with any of the terms hereof on their part to be
performed, unless such failure, refusal or inability is due primarily to the
default or omission of any Underwriter, the Selling Shareholders shall reimburse
the several Underwriters for reasonable out-of-pocket expenses, including fees
and disbursements of counsel, reasonably incurred in connection with
investigating, marketing and proposing to market the Shares or in contemplation
of performing their obligations hereunder; but the Company and the Selling
Shareholders shall not in any event be liable to any of the several Underwriters
for damages on account of loss of anticipated profits from the sale by them of
the Shares.
6. CONDITIONS OF OBLIGATIONS OF THE UNDERWRITERS.
The several obligations of the Underwriters to purchase the Firm
Shares on the Closing Date and the Option Shares, if any, on the Option Closing
Date are subject to the accuracy, as of the Closing Date or the Option Closing
Date, as the case may be, of the representations and warranties of the Company
and the Selling Shareholders contained herein, and to the performance by the
Company and the Selling Shareholders of their covenants and obligations
hereunder and to the following additional conditions:
(a) The Registration Statement and all post-effective amendments
thereto shall have become effective and any and all filings required by Rule 424
and Rule 430A of the Act shall have been made within the applicable time period
prescribed by, and in compliance with, the Rules and Regulations, and any
request of the Commission for additional information (to be included in the
Registration Statement or otherwise) shall have been disclosed to the
Representatives and complied with to their reasonable satisfaction. No stop
order suspending the effectiveness of the Registration Statement, as amended
from time to time, shall have been issued and no proceedings for that purpose
shall have been taken or, to the knowledge of the Company or the Selling
Shareholders, shall be contemplated or threatened by the Commission and no
injunction, restraining order or order of any nature by a Federal or state court
of competent jurisdiction shall have been issued as of the Closing Date which
would prevent the issuance of the Shares.
(b) The Representatives and the Selling Shareholders shall have
received on the Closing Date or the Option Closing Date, as the case may be, the
opinions of ▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP ("▇▇▇▇▇▇ ▇▇▇▇▇"), counsel for the
Company, dated the Closing Date or the Option Closing Date, as the case may be,
addressed to the Underwriters (and stating that it may be relied upon by counsel
to the Underwriters) and the Selling Shareholders to the effect that:
(i) The Company has been duly organized and is validly existing
as a corporation in good standing under the laws of the Commonwealth of
Pennsylvania, with corporate power and authority to own or lease its properties
and conduct its business as described in the Registration Statement; each of
Pennsylvania Suburban Water Company ("PSWC") and Consumers Water Company ("CWC")
has been duly organized and is validly existing as a corporation in good
standing under the laws of the Commonwealth of Pennsylvania, with corporate
power and authority to own or lease its properties and conduct its business as
described in the Registration Statement; the Company is duly qualified to
transact business in all jurisdictions in which the conduct of its business
requires such qualification, or in which the failure to qualify would have a
materially adverse effect upon the business of the Company and the Subsidiaries
taken as a whole; and the outstanding shares of capital stock of each of PSWC
and CWC have been duly authorized and validly issued and are fully paid and
non-assessable and are owned by the Company; and, to the best of such counsel's
knowledge, the outstanding shares of capital stock of each of PSWC and CWC is
owned free and clear of all liens, encumbrances and equities and claims.
(ii) The authorized shares of the Company's Common Stock have
been duly authorized; the outstanding shares of the Company's Common Stock,
including the Shares to be sold by the Selling Shareholders, have been duly
authorized and validly issued and are fully paid and non-assessable; all of the
Shares conform in all material respects as to legal matters to the description
thereof contained in the Prospectus; the certificates for the Shares, assuming
they are in the form filed with the Commission; conform to the requirements of
the Pennsylvania Business Corporation Law of 1988, as amended (the "PBCL"); and
no preemptive rights of shareholders exist with respect to any of the Shares or
the issue or sale thereof arising under the Company's Charter, By-laws or the
PBCL.
(iii) Based upon the oral advice of a member of the Staff of
the Commission, the Registration Statement has become effective under the Act
and, to the best of the knowledge of such counsel, no stop order proceedings
with respect thereto have been instituted or are pending or threatened under the
Act.
(iv) The Registration Statement, as of the date it became
effective, the Prospectus and each amendment or supplement thereto and document
incorporated by reference therein, as of each of their respect dates, comply as
to form in all material respects with the requirements of the Act or the
Exchange Act as applicable and the applicable rules and regulations thereunder
(except that such counsel need express no opinion as to the financial statements
and related schedules incorporated by reference therein).
(v) The statements under the captions "Recent
Developments--Pennichuck Acquisition" and "Relationship with Vivendi
Environnment S.A.--Agreement to Repurchase Shares and Financing Plan" in the
Prospectus, insofar as such statements constitute a summary of documents
referred to therein or matters of law, fairly summarize in all material respects
the information called for with respect to such documents and matters.
(vi) Such counsel does not know of any contracts or documents
required to be filed as exhibits to or incorporated by reference in the
Registration Statement or described in the Registration Statement or the
Prospectus which are not so filed, incorporated by reference or described as
required, and to counsel's knowledge, such contracts and documents as are
summarized in the Registration Statement or the Prospectus are fairly summarized
in all material respects.
(vii) Such counsel knows of no material legal or governmental
proceedings pending or threatened against the Company or any of the Subsidiaries
except as set forth in the Prospectus.
(viii) The execution and delivery of this Agreement and the
consummation of the transactions herein contemplated do not and will not violate
or result in a breach of any of the terms or provisions of, or constitute a
default under, the Charter or By-Laws of the Company, or any material indenture,
mortgage, deed of trust or other material agreement or instrument to which the
Company or any of the Subsidiaries is a party or by which the Company or any of
the Subsidiaries may be bound and which is known to such counsel.
(ix) This Agreement has been duly authorized, executed and
delivered by the Company.
(x) No approval, consent, order, authorization, designation,
declaration or filing by or with any regulatory, administrative or other
governmental body is necessary in connection with the execution and delivery of
this Agreement and the consummation of the transactions herein contemplated
(other than as may be required by the NASD or as required by State securities
and Blue Sky laws as to which such counsel need express no opinion) except such
as have been obtained or made, specifying the same.
(xi) The Company is not an "investment company" or an entity
"controlled" by an "investment company" within the meaning of such terms under
the 1940 Act and the rules and regulations of the Commission thereunder.
In rendering such opinion ▇▇▇▇▇▇ ▇▇▇▇▇ may rely as to matters governed
by the laws of states other than Pennsylvania, New York or Federal laws on local
counsel in such jurisdictions, provided that in each case ▇▇▇▇▇▇ ▇▇▇▇▇ shall
state that they believe that they and the Underwriters are justified in relying
on such other counsel. In addition to the matters set forth above, the
Underwriters shall receive a statement from such counsel to the effect that
nothing has come to the attention of such counsel which leads them to believe
that (i) the Registration Statement, at the time it became effective under the
Act (including the information deemed to be a part of the Registration Statement
at the time it became effective pursuant to Rule 430A under the Act), as of the
date hereof and as of the Closing Date or the Option Closing Date, as the case
may be, contained or contains an untrue statement of a material fact or omitted
or omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading (except that such counsel need
express no view as to financial statements, schedules and statistical
information therein), and (ii) the Prospectus, or any supplement thereto, on the
date it was filed pursuant to the Rules and Regulations and as of the Closing
Date or the Option Closing Date, as the case may be, contained or contains an
untrue statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading (except that such
counsel need express no view as to financial statements, schedules and
statistical information therein). With respect to such statement, ▇▇▇▇▇▇ ▇▇▇▇▇
may state that their belief is based upon the procedures set forth therein, but
is without independent check and verification.
(c) The Representatives shall have received on the Closing Date or
the Option Closing Date, as the case may be, the opinions of ▇▇▇ ▇. ▇▇▇▇▇, Esq.,
Executive Vice President - General Counsel for the Company, dated the Closing
Date or the Option Closing Date, as the case may be, addressed to the
Underwriters (and stating that it may be relied upon by counsel to the
Underwriters) to the effect that:
(i) The Company has been duly organized and is validly existing
as a corporation in good standing under the laws of the State of Pennsylvania,
with corporate power and authority to own or lease its properties and conduct
its business as described in the Registration Statement; each of the
Subsidiaries has been duly organized and is validly existing as a corporation in
good standing under the laws of the jurisdiction of its incorporation, with
corporate power and authority to own or lease its properties and conduct its
business as described in the Registration Statement; the Company and each of the
Subsidiaries are duly qualified to transact business in all jurisdictions in
which the conduct of their business requires such qualification, or in which the
failure to qualify would have a materially adverse effect upon the business of
the Company and the Subsidiaries taken as a whole; and the outstanding shares of
capital stock of each of the Subsidiaries have been duly authorized and validly
issued and are fully paid and non-assessable and are owned by the Company or a
Subsidiary; and, to the best of such counsel's knowledge, the outstanding shares
of capital stock of each of the Subsidiaries is owned free and clear of all
liens, encumbrances and equities and claims, and no options, warrants or other
rights to purchase, agreements or other obligations to issue or other rights to
convert any obligations into any shares of capital stock or of ownership
interests in the Subsidiaries are outstanding.
(ii) Except as described in or contemplated by the Prospectus
or the documents incorporated by reference therein, there are no outstanding
securities of the Company convertible or exchangeable into or evidencing the
right to purchase or subscribe for any shares of capital stock of the Company
and there are no outstanding or authorized options, warrants or rights of any
character obligating the Company to issue any shares of its capital stock or any
securities convertible or exchangeable into or evidencing the right to purchase
or subscribe for any shares of such stock; and except as described in the
Prospectus or the documents incorporated by reference therein, no holder of any
securities of the Company or any other person has the right, contractual or
otherwise, which has not been satisfied or effectively waived, to cause the
Company to sell or otherwise issue to them, or to permit them to underwrite the
sale of, any of the Shares or the right to have any Common Shares or other
securities of the Company included in the Registration Statement or the right,
as a result of the filing of the Registration Statement, to require registration
under the Act of any shares of Common Stock or other securities of the Company.
(iii) Each of the Company and the Subsidiaries owns, possesses,
has obtained or meets the requirements for all licenses, permits, certificates,
consents, orders, approvals and other authorizations from, and has made all
declarations and filings with, all federal, state, local and other governmental
authorities (including foreign regulatory agencies), all self-regulatory
organizations and all courts and other tribunals, domestic or foreign, necessary
to own or lease, as the case may be, and to operate its properties and to carry
on its business as conducted as of the date hereof except where the lack thereof
would not have a Material Adverse Effect, and neither the Company nor any such
Subsidiary has received any actual written notice of any proceeding relating to
revocation or modification of any such license, permit, certificate, consent,
order, approval or other authorization that would materially interfere with its
ownership or lease, as the case may be, or the operation of its properties or
the carrying on of its business as conducted on the date hereof, except as
described in the Registration Statement and the Prospectus; and to the best of
his knowledge, each of the Company and the Subsidiaries is in material
compliance with all laws and regulations relating to the conduct of its business
as conducted as of the date of the Prospectus except where such noncompliance
would not have a Material Adverse Effect.
(d) The Representatives shall have received on the Closing Date or
the Option Closing Date, as the case may be, the opinion of Cleary, Gottlieb,
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ ("▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇"), counsel for the Selling Shareholders,
dated the Closing Date or the Option Closing Date, as the case may be, addressed
to the Underwriters (and stating that it may be relied upon by counsel to the
Underwriters) to the effect that:
(i) This Agreement has been duly authorized, executed and
delivered on behalf of the Selling Shareholders and is a valid and binding
agreement of each Selling Shareholder.
(ii) Each Selling Shareholder has full legal right, power and
authority, and any approval required by law (other than as required by State
securities and Blue Sky laws as to which such counsel need express no opinion),
to sell, assign, transfer and deliver the portion of the Shares to be sold by
such Selling Shareholder.
(iii) Assuming that (a) DTC is a "clearing corporation" as
defined in Section 8-102(a)(5) of the Uniform Commercial Code (the "UCC"), and
(b) each of the Underwriters acquires its interest in the Shares it has
purchased without notice of any adverse claim (within the meaning of Section
8-105 of the UCC), each Underwriter that has purchased Shares from the Selling
Shareholders, made payment therefor pursuant to this Agreement and has had such
Shares credited to a securities account of such Underwriter maintained with DTC
will have acquired a securities entitlement (within the meaning of Section
8-102(a)(17) of the UCC) to such Shares, and no action based on an adverse claim
may be asserted against such Underwriter with respect to such security
entitlement.
In rendering such opinion, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ may rely as to matters
governed by the laws of states other than New York or Federal laws on local
counsel in such jurisdictions, provided that in each case ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ shall
state that they believe that they and the Underwriters are justified in relying
on such other counsel.
(e) The Representatives shall have received from ▇▇▇▇▇ ▇▇▇▇ &
▇▇▇▇▇▇▇▇ ("▇▇▇▇▇ ▇▇▇▇"), counsel for the Underwriters, an opinion dated the
Closing Date or the Option Closing Date, as the case may be, substantially to
the effect specified in subparagraph (x) of Paragraph (b) of this Section 6 and
subparagraph (i) of Paragraph (d) of this Section 6. In rendering such opinion
▇▇▇▇▇ ▇▇▇▇ may rely as to all matters governed other than by the laws of the
State of New York or Federal laws on the opinion of counsel referred to in
Paragraph (b) of this Section 6. In addition to the matters set forth above,
such opinion shall also include a statement to the effect that nothing has come
to the attention of such counsel which leads them to believe that (i) the
Registration Statement, or any amendment thereto, as of the time it became
effective under the Act (including the information deemed to be a part of the
Registration Statement at the time it became effective pursuant to Rule 430A
under the Act) as of the Closing Date or the Option Closing Date, as the case
may be, contained or contains an untrue statement of a material fact or omitted
or omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, and (ii) the Prospectus, or any
supplement thereto, on the date it was filed pursuant to the Rules and
Regulations and as of the Closing Date or the Option Closing Date, as the case
may be, contained or contains an untrue statement of a material fact or omitted
or omits to state a material fact, necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading (except that such counsel need express no view as to financial
statements, schedules and statistical information therein). With respect to such
statement, ▇▇▇▇▇ ▇▇▇▇ may state that their belief is based upon the procedures
set forth therein, but is without independent check and verification.
(f) You shall have received, on each of the date hereof, the Closing
Date and, if applicable, the Option Closing Date, a letter dated the date
hereof, the Closing Date or the Option Closing Date, as the case may be, in form
and substance satisfactory to you, of PricewaterhouseCoopers LLP confirming that
they are independent public accountants within the meaning of the Act and the
applicable published Rules and Regulations thereunder and stating that in their
opinion the financial statements and schedules examined by them and included in
the Registration Statement comply in form in all material respects with the
applicable accounting requirements of the Act and the related published Rules
and Regulations; and containing such other statements and information as is
ordinarily included in accountants' "comfort letters" to Underwriters with
respect to the financial statements and certain financial and statistical
information contained in the Registration Statement and Prospectus. You shall
also have received, on each of the date hereof, the Closing Date and, if
applicable, the Option Closing Date, a letter dated the date hereof, the Closing
Date or the Option Closing Date, as the case may be, in form and substance
satisfactory to you, of KMPG with regard to certain financial information for
fiscal year 1999.
(g) The Representatives and the Selling Shareholders shall have
received on the Closing Date and, if applicable, the Option Closing Date, as the
case may be, a certificate or certificates of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇, President
and Chairman of the Company, and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Chief Financial Officer of the
Company, solely in their respective capacities as such, to the effect that, as
of the Closing Date or the Option Closing Date, as the case may be, each of them
severally represents as follows:
(i) The Registration Statement has become effective under the
Act and no stop order suspending the effectiveness of the Registration Statement
has been issued, and, to his knowledge after due inquiry, no proceedings for
such purpose have been taken or are, to his knowledge, contemplated or
threatened by the Commission;
(ii) The representations and warranties of the Company
contained in Section 1 hereof are true and correct as of the Closing Date or the
Option Closing Date, as the case may be;
(iii) All filings required to have been made pursuant to Rules
424 or 430A under the Act have been made as and when required by such rules;
(iv) He has carefully examined the Registration Statement and
the Prospectus and, in his opinion, as of the effective date of the Registration
Statement, the statements contained in the Registration Statement were true and
correct, and such Registration Statement and Prospectus did not 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, and since the effective date of the Registration Statement, no
event has occurred which should have been set forth in a supplement to or an
amendment of the Prospectus which has not been so set forth in such supplement
or amendment; and
(v) Since the respective dates as of which information is given
in the Registration Statement and Prospectus, there has not been any change or
any development that has had or will have a Material Adverse Effect.
(h) The Company and the Selling Shareholders shall have furnished to
the Representatives such further certificates and documents confirming the
representations and warranties, covenants and conditions contained herein and
related matters as the Representatives my reasonably have requested.
(i) The Lockup Agreements described in Section 4(a)(viii) are in
full force and effect.
The opinions and certificates mentioned in this Agreement shall be
deemed to be in compliance with the provisions hereof only if they are in all
material respects satisfactory to the Representatives and to ▇▇▇▇▇ ▇▇▇▇, counsel
for the Underwriters.
If any of the conditions hereinabove provided for in this Section 6
shall not have been fulfilled when and as required by this Agreement to be
fulfilled, the obligations of the Underwriters hereunder may be terminated by
the Representatives by notifying the Company and the Selling Shareholders of
such termination in writing or by telegram at or prior to the Closing Date or
the Option Closing Date, as the case may be.
In such event, the Selling Shareholders, the Company and the
Underwriters shall not be under any obligation to each other (except to the
extent provided in Sections 5 and 8 hereof).
7. CONDITIONS OF THE OBLIGATIONS OF THE SELLING SHAREHOLDERS.
The obligations of the Selling Shareholders to sell and deliver the
portion of the Shares required to be delivered as and when specified in this
Agreement are subject to the conditions that at the Closing Date or the Option
Closing Date, as the case may be, no stop order suspending the effectiveness of
the Registration Statement shall have been issued and in effect or proceedings
therefor initiated or threatened and the Selling Shareholders shall have been
furnished the opinion described in Section 6(b) and the certificate described in
Section 6(g).
8. INDEMNIFICATION.
(a) The Company agrees:
(1) to indemnify and hold harmless each Underwriter and each person,
if any, who controls any Underwriter within the meaning of either
Section 15 of the Act or Section 20 of the Exchange Act, against any
losses, claims, damages or liabilities to which such Underwriter or any
such controlling person may become subject under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) arise out of or are based upon (i) any
untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement, any Preliminary Prospectus,
the Prospectus or any amendment or supplement thereto, or (ii) the
omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances under which they were
made; provided, however, that the Company will not be liable in any
such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue
statement, or omission or alleged omission made in the Registration
Statement, any Preliminary Prospectus, the Prospectus, or such
amendment or supplement, in reliance upon and in conformity with
written information furnished to the Company by or through the
Representatives or the Selling Shareholders specifically for use in the
preparation thereof; and
(2) to reimburse each Underwriter and each such controlling person
upon demand for any legal or other out-of-pocket expenses reasonably
incurred by such Underwriter or such controlling person in connection
with investigating or defending any such loss, claim, damage or
liability, action or proceeding or in responding to a subpoena or
governmental inquiry related to the offering of the Shares, whether or
not such Underwriter or controlling person is a party to any action or
proceeding. In the event that it is finally judicially determined that
the Underwriters were not entitled to receive payments for legal and
other expenses pursuant to this subparagraph, the Underwriters will
promptly return all sums that had been advanced pursuant hereto.
(b) The Selling Shareholders agree to indemnify the Underwriters and
each person, if any, who controls any Underwriter within the meaning of Section
15 of the Act or Section 20 of the Exchange Act, against any losses, claims,
damages or liabilities to which such Underwriter or controlling person may
become subject under the Act or otherwise to the same extent as indemnity is
provided by the Company pursuant to Section 8(a) above; provided, however, that
each Selling Shareholders' indemnity obligation shall be limited to losses,
claims, damages or liabilities arising out of or based upon an untrue statement
or alleged untrue statement, or omission or alleged omission made in the
Registration Statement, any Preliminary Prospectus, the Prospectus, or such
amendment or supplement, in reliance upon and in conformity with written
information furnished to the Company by or through such Selling Shareholder
specifically for use in the preparation thereof. In no event shall the liability
of any Selling Shareholder for indemnification under Section 8(a) exceed the
proceeds received by such Selling Shareholder from the Underwriters in the
offering. This indemnity obligation will be in addition to any liability which
the Company may otherwise have.
(c) Each Underwriter severally and not jointly will indemnify and
hold harmless the Company, each of its directors, each of its officers who have
signed the Registration Statement, the Selling Shareholders, and each person, if
any, who controls the Company or the Selling Shareholders within the meaning of
the Act, against any losses, claims, damages or liabilities to which the Company
or any such director, officer, Selling Shareholder or controlling person may
become subject under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) arise out
of or are based upon (i) any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement, any Preliminary
Prospectus, the Prospectus or any amendment or supplement thereto, or (ii) the
omission or the alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading in the
light of the circumstances under which they were made; and will reimburse any
legal or other expenses reasonably incurred by the Company or any such director,
officer, Selling Shareholder or controlling person in connection with
investigating or defending any such loss, claim, damage, liability, action or
proceeding; provided, however, that each Underwriter will be liable in each case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission has been made in the
Registration Statement, any Preliminary Prospectus, the Prospectus or such
amendment or supplement, in reliance upon and in conformity with written
information furnished to the Company by or through the Representatives
specifically for use in the preparation thereof. This indemnity agreement will
be in addition to any liability which such Underwriter may otherwise have.
(d) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity may be sought pursuant to this Section 8, such person (the
"indemnified party") shall promptly notify the person against whom such
indemnity may be sought (the "indemnifying party") in writing. No
indemnification provided for in Section 8(a), (b) or (c) shall be available to
any party who shall fail to give notice as provided in this Section 8(d) if the
party to whom notice was not given was unaware of the proceeding to which such
notice would have related and was materially prejudiced by the failure to give
such notice, but the failure to give such notice shall not relieve the
indemnifying party or parties from any liability which it or they may have to
the indemnified party for contribution or otherwise than on account of the
provisions of Section 8(a), (b) or (c). In case any such proceeding shall be
brought against any indemnified party and it shall notify the indemnifying party
of the commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party and shall pay as incurred the
fees and disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own counsel
at its own expense. Notwithstanding the foregoing, the indemnifying party shall
pay as incurred (or within 30 days of presentation) the fees and expenses of the
counsel retained by the indemnified party in the event (i) the indemnifying
party and the indemnified party shall have mutually agreed to the retention of
such counsel, (ii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the indemnified party
and representation of both parties by the same counsel would be inappropriate
due to actual or potential differing interests between them or (iii) the
indemnifying party shall have failed to assume the defense and employ counsel
acceptable to the indemnified party within a reasonable period of time after
notice of commencement of the action. It is understood that the indemnifying
party shall not, in connection with any proceeding or related proceedings in the
same jurisdiction, be liable for the reasonable fees and expenses of more than
one separate firm for all such indemnified parties. Such firm shall be
designated in writing by you in the case of parties indemnified pursuant to
Section 8(a) or (b) and by the Company and the Selling Shareholders in the case
of parties indemnified pursuant to Section 8(c). The indemnifying party 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 from
and against any loss or liability by reason of such settlement or judgment. In
addition, the indemnifying party will not, without the prior written consent of
the indemnified party, settle or compromise or consent to the entry of any
judgment in any pending or threatened claim, action or proceeding of which
indemnification may be sought hereunder (whether or not any indemnified party is
an actual or potential party to such claim, action or proceeding) unless such
settlement, compromise or consent includes an unconditional release of each
indemnified party from all liability arising out of such claim, action or
proceeding.
(e) To the extent the indemnification provided for in this Section 8
is unavailable to or insufficient to hold harmless an indemnified party under
Section 8(a), (b) or (c) above in respect of any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) in such proportion as
is appropriate to reflect the relative benefits received by the Company and the
Selling Shareholders on the one hand and the Underwriters on the other from the
offering of the Shares. If, however, the allocation provided by the immediately
preceding sentence is not permitted by applicable law then each indemnifying
party shall contribute to such amount paid or payable by such indemnified party
in such proportion as is appropriate to reflect not only such relative benefits
but also the relative fault of the Company and the Selling Shareholders on the
one hand and the Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Company and the
Selling Shareholders on the one hand and the Underwriters on the other shall be
deemed to be in the same proportion as the total net proceeds from the offering
(before deducting expenses) received by the Company and the Selling Shareholders
bear to the total underwriting discounts and commissions received by the
Underwriters, in each case as set forth in the table on the cover page of the
Prospectus; provided however, that nothing herein shall be construed to prevent
the Company and the Selling Shareholders from allocating any such losses,
claims, damages or liabilities among themselves pursuant to a separate agreement
between such parties. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company or the Selling Shareholders on the one hand
or the Underwriters on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.
The Company, the Selling Shareholders and the Underwriters agree
that it would not be just and equitable if contributions pursuant to this
Section 8(e) 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 above in this Section 8(e). The amount paid or payable by an indemnified
party as a result of the losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) referred to above in this Section 8(e) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this subsection (e), (i) no
Underwriter shall be required to contribute any amount in excess of the
underwriting discounts and commissions applicable to the Shares purchased by
such Underwriter, (ii) no person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation, and (iii) no
Selling Shareholder shall be required to contribute any amount in excess of the
proceeds received by such Selling Shareholder from the Underwriters in the
offering. The Underwriters' obligations in this Section 8(e) to contribute are
several in proportion to their respective underwriting obligations and not
joint.
(f) In any proceeding relating to the Registration Statement, any
Preliminary Prospectus, the Prospectus or any supplement or amendment thereto,
each party against whom contribution may be sought under this Section 8 hereby
consents to the jurisdiction of any court having jurisdiction over any other
contributing party, agrees that process issuing from such court may be served
upon it by any other contributing party and consents to the service of such
process and agrees that any other contributing party may join it as an
additional defendant in any such proceeding in which such other contributing
party is a party.
(g) Any losses, claims, damages, liabilities or expenses for which
an indemnified party is entitled to indemnification or contribution under this
Section 8 shall be paid by the indemnifying party to the indemnified party as
such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 8 and the
representations and warranties of the Company set forth in this Agreement shall
remain operative and in full force and effect, regardless of (i) any
investigation made by or on behalf of any Underwriter or any person controlling
any Underwriter, the Company, its directors or officers or any persons
controlling the Company, (ii) acceptance of any Shares and payment therefor
hereunder, and (iii) any termination of this Agreement. A successor to any
Underwriter, or any person controlling any Underwriter, or to the Company, its
directors or officers, or any person controlling the Company, shall be entitled
to the benefits of the indemnity, contribution and reimbursement agreements
contained in this Section 8.
9. DEFAULT BY UNDERWRITERS.
If on the Closing Date or the Option Closing Date, as the case may
be, any Underwriter shall fail to purchase and pay for the portion of the Shares
which such Underwriter has agreed to purchase and pay for on such date
(otherwise than by reason of any default on the part of the Company or a Selling
Shareholder), you, as Representatives of the Underwriters, shall use your
reasonable efforts to procure within 36 hours thereafter one or more of the
other Underwriters, or any others, to purchase from the Company and the Selling
Shareholders such amounts as may be agreed upon and upon the terms set forth
herein, the Shares which the defaulting Underwriter or Underwriters failed to
purchase. If during such 36 hours you, as such Representatives, shall not have
procured such other Underwriters, or any others, to purchase the Shares agreed
to be purchased by the defaulting Underwriter or Underwriters, then (a) if the
aggregate number of shares with respect to which such default shall occur does
not exceed 10% of the Shares to be purchased on the Closing Date or the Option
Closing date, as the case may be, the other Underwriters shall be obligated,
severally, in proportion to the respective numbers of Shares which they are
obligated to purchase hereunder, to purchase the Shares which such defaulting
Underwriter or Underwriters failed to purchase, or (b) if the aggregate number
of shares of Shares with respect to which such default shall occur exceeds 10%
of the Shares to be purchased on the Closing Date or the Option Closing Date, as
the case may be, the Company and the Selling Shareholders or you as
Representatives will have the right, by written notice given within the next
36-hour period to the parties to this Agreement, to terminate this Agreement
without liability on the part of the non-defaulting Underwriters or of the
Company or of the Selling Shareholders except to the extent provided in Sections
5 and 8 hereof. In the event of a default by any Underwriter or Underwriters, as
set forth in this Section 9, the Closing Date or Option Closing Date, as the
case may be, may be postponed for such period, not exceeding seven days, as the
Company or you, as Representatives, may determine in order that the required
changes in the Registration Statement or in the Prospectus or in any other
documents or arrangements may be effected. The term "Underwriter" includes any
person substituted for a defaulting Underwriter. 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.
10. NOTICES.
All communications hereunder shall be in writing and, except as
otherwise provided herein, will be mailed, delivered, telecopied or telegraphed
and confirmed as follows: if to the Underwriters, to Deutsche Bank Securities
Inc., ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇; Attention: Syndicate Manager,
with a copy to Deutsche Bank Securities Inc., ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, Attention: General Counsel.
To the Company:
Philadelphia Suburban Corporation
▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇, Esq.
Executive Vice President and General Counsel
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
To the Selling Shareholders:
Vivendi Water S.A.
▇▇, ▇▇▇ ▇'▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Fax: (+33.1) 49.24.69.11
Vivendi North America Company
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ Contamine
Fax: (+33.1) 71.75.10.09
with a copy to:
Cleary, Gottlieb, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇, ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Fax: ▇▇ ▇ ▇▇▇▇ ▇▇▇▇
11. TERMINATION.
This Agreement may be terminated by you, as Representatives, by
written notice to the Company and the Selling Shareholders (a) at any time prior
to the Closing Date or any Option Closing Date (if different from the Closing
Date and then only as to Option Shares) if any of the following has occurred:
(i) since the respective dates as of which information is given in the
Registration Statement and the Prospectus, any material adverse change or any
development occurs that has had a Material Adverse Effect (ii) any outbreak or
escalation of hostilities or declaration of war or national emergency or other
national or international calamity or crisis or change in economic or political
conditions if the effect of such outbreak, escalation, declaration, emergency,
calamity, crisis or change on the financial markets of the United States would,
in your reasonable judgment, make it impracticable or inadvisable to market the
Shares or to enforce contracts for the sale of the Shares, or (iii) suspension
of trading in securities generally on the New York Stock Exchange, the American
Stock Exchange or the Nasdaq National Market or limitation on prices (other than
limitations on hours or numbers of days of trading) for securities on either
such Exchange, (iv) the enactment, publication, decree or other promulgation of
any statute, regulation, rule or order of any court or other governmental
authority which in your reasonable opinion would create a Material Adverse
Effect (v) the declaration of a banking moratorium by United States or New York
State authorities, (vi) any downgrading, or placement on any watch list for
possible downgrading, in the rating of any of the Company's debt securities by
any "nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the Exchange Act); (vii) the suspension of trading
of the Company's common stock by the New York Stock Exchange, the Commission, or
any other governmental authority or, (viii) the taking of any action by any
governmental body or agency in respect of its monetary or fiscal affairs which
in your reasonable opinion has a material adverse effect on the securities
markets in the United States; or
(b) as provided in Sections 6 and 9 of this Agreement.
Any such termination shall be without liability of any party to any
other party except that the provisions of Section 5 and 8 hereof shall at all
times be effective.
12. SUCCESSORS.
This Agreement has been and is made solely for the benefit of the
Underwriters, the Company and the Selling Shareholders and their respective
successors, executors, administrators, heirs and assigns, and the officers,
directors and controlling persons referred to herein, and no other person will
have any right or obligation hereunder. No purchaser of any of the Shares from
any Underwriter shall be deemed a successor or assign merely because of such
purchase.
13. INFORMATION PROVIDED BY UNDERWRITERS AND SELLING SHAREHOLDERS.
The Company, the Selling Shareholders and the Underwriters
acknowledge and agree that the only information furnished or to be furnished by
any Underwriter to the Company for inclusion in any Prospectus or the
Registration Statement consists of the information set forth under the caption
"Underwriting" in the Prospectus. The Company, the Selling Shareholders and the
Underwriters acknowledge and agree that the only information furnished or to be
furnished by any Selling Shareholder to the Company for inclusion in any
Prospectus or the Registration Statement consists of the information set forth
under the captions "Selling Shareholders" and "Relationship with Vivendi
Environnement S.A.--General" in the Prospectus.
14. MISCELLANEOUS.
The reimbursement, indemnification and contribution agreements
contained in this Agreement and the representations, warranties and covenants in
this Agreement shall remain in full force and effect regardless of (a) any
termination of this Agreement, (b) any investigation made by or on behalf of any
Underwriter or controlling person thereof, or by or on behalf of the Company or
its directors or officers and (c) delivery of and payment for the Shares under
this Agreement.
This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
This Agreement shall be governed by, and construed in accordance
with, the laws of the State of New York.
15. SUBMISSION TO JURISDICTION
Except as set forth below, no claim arising out of or in any way
relating to this Agreement may be commenced, prosecuted or continued in any
court other than the courts of the State of New York located in the City and
County of New York or in the United States District Court for the Southern
District of New York, which courts shall have jurisdiction over the adjudication
of such matters, and each of the Company and Selling Shareholders consents to
the jurisdiction of such courts and personal service with respect thereto. Each
of the Company and Selling Shareholders hereby consents to personal
jurisdiction, service and venue in any court in which any claim arising out of
or in any way relating to this Agreement is brought by any third party against
UBS Warburg LLC, Deutsche Bank Securities Inc. or any indemnified party. Each of
UBS Warburg LLC, Deutsche Bank Securities Inc., the Company (on its behalf and,
to the extent permitted by applicable law, on behalf of its shareholders and
affiliates) and the Selling Shareholders waives all right to trial by jury in
any action, proceeding or counterclaim (whether based upon contract, tort or
otherwise) in any way arising out of or relating to this Agreement. Each of the
Company and Selling Shareholders agrees that a final judgment in any such
action, proceeding or counterclaim brought in any such court shall be conclusive
and binding upon the Company or such Selling Shareholder and may be enforced in
any other courts in the jurisdiction of which the Company or such Selling
Shareholder is or may be subject, by suit upon such judgment.
* * *
If the foregoing letter is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicates hereof,
whereupon it will become a binding agreement among the Selling Shareholders, the
Company and the several Underwriters in accordance with its terms.
Any person executing and delivering this Agreement as Attorney-in-Fact
for a Selling Shareholder represents by so doing that he has been duly appointed
as Attorney-in-Fact by such Selling Shareholder pursuant to a validly existing
and binding Power of Attorney which authorizes such Attorney-in-Fact to take
such action.
Very truly yours,
PHILADELPHIA SUBURBAN CORPORATION
By:
President
Title:
Selling Shareholders listed on Schedule II
By:
Attorney-in-Fact
The foregoing Underwriting
Agreement is hereby confirmed
and accepted as of the date
first above written.
DEUTSCHE BANK SECURITIES INC.
UBS WARBURG LLC
As Representatives of the several
Underwriters listed on Schedule I
By: Deutsche Bank Securities Inc. By: UBS Warburg LLC
By: By:
------------------------ ------------------------
Authorized Officer Authorized Officer
By: By:
------------------------ ------------------------
Authorized Officer Authorized Officer
SCHEDULE I
SCHEDULE OF UNDERWRITERS
Number of Firm Shares
Underwriter to be Purchased
----------- ---------------------
Deutsche Bank Securities Inc.
UBS Warburg LLC
----------
Total
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SCHEDULE II
SCHEDULE OF SELLING SHAREHOLDERS
Number of Firm Shares
Selling Shareholder to be Sold
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SCHEDULE III
SIGNIFICANT SUBSIDIARIES
Pennsylvania Suburban Water Company
Consumers Water Company