EXHIBIT 1
ALLTEL CORPORATION
(a Delaware corporation)
DEBT SECURITIES
TERMS AGREEMENT
Dated: June 14, 2002
ALLTEL Corporation
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
We, the underwriters named below (the "Underwriters"), understand that
ALLTEL Corporation, a Delaware corporation (the "Company"), proposes to issue
and sell:
(a) $800,000,000 aggregate principal amount of its unsecured senior debt
securities due July 1, 2012; and
(b) $700,000,0000 aggregate principal amount of its unsecured senior debt
securities due July 1, 2032,
(together, the "Securities").
Subject to the terms and conditions set forth herein or incorporated by
reference herein, and based upon the representations and warranties incorporated
by reference herein, the Underwriters offer to purchase, severally and not
jointly, the respective principal amounts of Securities set forth below opposite
their respective names at the purchase price set forth below.
Underwriter Principal Amount of Securities
Notes due 2012 Notes due ▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ Securities LLC $205,000,000 $179,375,000
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated $205,000,000 $179,375,000
▇▇▇▇▇▇▇▇ Inc. $200,000,000 $175,000,000
First Union Securities, Inc. $ 52,000,000 $ 45,500,000
Banc One Capital Markets, Inc. $ 36,000,000 $ 31,500,000
McDonald Investments Inc. $ 36,000,000 $ 31,500,000
SunTrust Capital Markets Inc. $ 36,000,000 $ 31,500,000
▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc. $ 14,000,000 $ 12,250,000
The ▇▇▇▇▇▇▇▇ Capital Group, L.P. $ 14,000,000 $ 12,250,000
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. $ 2,000,000 $ 1,750,000
Total $800,000,000 $700,000,000
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The Securities shall have the terms described in the Preliminary Prospectus
Supplement with respect to the Securities dated June 13, 2002 and the following
additional terms:
Notes due Notes due
July 1, 2012 July 1, 2032
Interest rate: 7% per year 7.875% per year
Initial public offering price: 99.605% 99.584%
Purchase Price: 99.155% 98.709%
Subject to the following provisions, all the terms contained in the
document attached as Annex A hereto entitled "Underwriting Agreement - Basic
Provisions" (the "Basic Provisions") are hereby incorporated by reference in
their entirety herein and shall be deemed to be a part of this Terms Agreement
to the same extent as if such provisions had been set forth in full herein. This
Terms Agreement prevails if there is any inconsistency with the terms of the
Basic Provisions.
Terms defined in the Basic Provisions are used herein as therein defined,
unless otherwise defined or the context requires otherwise.
1. For the purposes of Section 2(b) of the Basic Provisions, (i) payment of
the purchase price for the Securities will be made to the Company at the offices
of Shearman & Sterling, New York, New York, at 9:00 a.m. (New York time), on the
third business day following the date of this Terms Agreement or at such other
place, time and date as the Representatives and the Company may agree upon, and
(ii) for the purposes of expediting the checking of the Securities by the
Representatives, the Company agrees to make the Securities available to the
Depository not later than 12:00 noon (New York time), on the business day before
the Closing Date.
2. The Company has entered into an agreement to buy certain telephone
properties of Verizon Communications Inc. dated as of October 31, 2001 (the
"Verizon Acquisition") and a subsidiary of the Company has entered into an
agreement to purchase all of the shares of CenturyTel Wireless, Inc.
("CenturyTel Wireless") from CenturyTel Inc. dated as of March 19, 2002 (the
"CenturyTel Acquisition"). The Verizon Acquisition and the CenturyTel
Acquisition are hereinafter referred to as the "Pending Acquisitions." The
purchase agreements setting forth the terms and conditions applicable to the
Pending Acquisitions are hereinafter referred to collectively as the
"Acquisition Agreements." CenturyTel Wireless and its subsidiaries, as well as
any corporations comprising or forming part of the telephone properties of
Verizon Communications Inc. being purchased under the Verizon Acquisition, are
hereinafter referred to collectively as the "Acquisition Companies."
3. In addition to Section 1 of the Basic Provisions, the Company represents
and warrants to the Representatives and each other Underwriter as of the date
hereof (the "Representation Date") and as of the Closing Date (as referred to in
Section 2(b) of the Basic Provisions) that:
ii
(a) The Company has delivered to the Underwriters a true and correct
copy of each of the Acquisition Agreements, together with all related agreements
and all schedules and exhibits thereto, and there have been no amendments,
alterations, modifications or waivers of any of the provisions of any
Acquisition Agreement since the form in which it has been delivered to the
Underwriters.
(b) Each of the Acquisition Agreements has been duly authorized,
executed and delivered by the Company and/or its subsidiary, as applicable, and
is a valid and binding agreement of the Company and/or its subsidiary, as
applicable.
4. For the purposes of Section 12 of the Basic Provisions, the address of
the Representatives for the delivery of notices is Banc of America Securities
LLC, Banc of America Corporate Center, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇, Attention: Debt Capital Markets (facsimile no: (▇▇▇) ▇▇▇-▇▇▇▇)
and ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇▇▇, Attention: Debt Capital Markets (facsimile no: (▇▇▇) ▇▇▇-▇▇▇▇).
Please accept this offer no later than 6:00 p.m. (Little Rock, Arkansas
time) by signing a copy of this Terms Agreement in the space set forth below and
returning the signed copy to us.
Very truly yours,
BANC OF AMERICA SECURITIES LLC
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇▇ INC.
FIRST UNION SECURITIES, INC.
BANC ONE CAPITAL MARKETS, INC.
MCDONALD INVESTMENTS INC.
SUNTRUST CAPITAL MARKETS INC.
▇▇▇▇▇▇ ▇▇▇▇▇▇ & COMPANY, INC.
THE ▇▇▇▇▇▇▇▇ CAPITAL GROUP, ▇.▇.
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC.
iii
BANC OF AMERICA SECURITIES LLC
By: /s/ ▇▇▇▇ ▇▇▇▇▇
____________________
Authorized Signatory
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
By: /s/ ▇▇▇▇ ▇▇▇▇
____________________
Authorized Signatory
As representatives of the several Underwriters
iv
Accepted by: ALLTEL Corporation
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------------------
Title: President and Chief Operating Officer
--------------------------------------
v
ANNEX A
================================================================================
ALLTEL CORPORATION
(a Delaware corporation)
DEBT SECURITIES
UNDERWRITING AGREEMENT - BASIC PROVISIONS
================================================================================
Underwriting Agreement - Basic Provisions
ALLTEL Corporation (the "Company") proposes to issue and sell up to
$1,500,000,000 aggregate principal amount of its debt securities in such single
or multiple series as set forth in the Terms Agreement (as defined below) under
an Indenture dated as of January 1, 1987, by and between the Company and ▇. ▇.
▇▇▇▇▇▇ Trust Company, National Association, successor to Society National Bank,
as trustee (the "Trustee"), as supplemented by a First Supplemental Indenture
dated as of March 1, 1987, a Second Supplemental Indenture dated as of April 1,
1989, a Third Supplemental Indenture dated as of May 8, 1990, a Fourth
Supplemental Indenture dated as of March 1, 1991, a Fifth Supplemental Indenture
dated as of October 15, 1993, a Sixth Supplemental Indenture dated as of April
1, 1994, a Seventh Supplemental Indenture dated as of September 1, 1995, an
Eighth Supplemental Indenture dated as of March 1, 1996, a Ninth Supplemental
Indenture dated as of April 1, 1999, a Tenth Supplemental Indenture dated as of
May 6, 2002, an Eleventh Supplemental Indenture dated as of June 19, 2002 and a
Twelfth Supplemental Indenture dated as of June 19, 2002 (collectively, the
"Indenture").
This is to confirm the arrangements with respect to the purchase of debt
securities from the Company by the Representatives and the several Underwriters
listed in the applicable terms agreement entered into between the
Representatives and the Company of which these Basic Provisions are Annex A
thereto (the "Terms Agreement") and are incorporated therein by reference. The
Terms Agreement, together with the provisions hereof, is herein referred to as
the "Agreement."
Terms defined in the Terms Agreement are used herein as therein defined.
Debt securities subject to the Terms Agreement are herein referred to as the
"Securities." If the Securities are to be purchased by an underwriting
syndicate, the term "Representatives" as used herein shall mean the
representatives of the members of the underwriting syndicate, and the term
"Underwriters" shall mean all the members of the underwriting syndicate,
including the Representatives. If the Securities are being purchased by one or
more underwriters and not by an underwriting syndicate, the terms
"Representatives" and "Underwriters" shall mean such underwriters. The terms
"Underwriters" and "Representatives" shall be interpreted in the singular or
plural, as appropriate in the context of the Terms Agreement.
As used in this Agreement, the term "Operative Documents" means this
Agreement, the Securities and the Indenture.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 covering the registration of
certain securities, including the Securities, and the offering thereof from time
to time in accordance with Rule 415 under the Securities Act of 1933, as amended
(the "Securities Act"), and has filed such amendments thereto as may have been
required to the date of the Terms Agreement. Such registration statement, as so
amended, and the prospectus constituting a part thereof (including, in each
case, all documents incorporated therein by reference) as they are from time to
time amended or supplemented by the filing of documents pursuant to the
Securities Act (including the Prospectus Supplement, as defined below) or the
Securities Exchange Act of 1934, as
1
amended (the "1934 Act"), are hereinafter called the "Registration Statement"
and the "Prospectus," respectively.
SECTION 1. Representations and Warranties of the Company. The Company
---------------------------------------------
represents and warrants to the Representatives and each other Underwriter named
in the Terms Agreement as of the date thereof (the "Representation Date") and as
of the Closing Date (as defined in Section 2(b)):
(a) At the time the Registration Statement became effective and as of
the Representation Date, the Registration Statement and the Prospectus complied
in all material respects with the provisions of the Securities Act, the Trust
Indenture Act of 1939 (the "1939 Act") and the rules and regulations of the
Commission thereunder (the "Regulations"), and the Indenture was qualified under
the 1939 Act. At the time the Registration Statement became effective and as of
the Representation Date, the Registration Statement did not, and will not during
the period specified in Section 3(b), contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading. The Prospectus, at the time the
Registration Statement became effective and as of the Representation Date and
the Closing Date, did not, and will not during the period specified in Section
3(b), contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; provided, however,
that none of the representations and warranties in this subsection shall apply
to statements in or omissions from the Registration Statement or the Prospectus
made in reliance upon and in conformity with information furnished to the
Company in writing by an Underwriter expressly for use in the Registration
Statement or the Prospectus or those exhibits to the Registration Statement that
constitute the Statement of Eligibility (Form T-1) of the Trustee.
(b) The documents incorporated by reference in the Prospectus, at the
time they were or hereafter are filed with the Commission, complied and will
comply at all times during the period specified in Section 3(b) in all material
respects with the requirements of the 1934 Act and the rules and regulations of
the Commission thereunder (the "1934 Act Regulations") and, when read together
with the other information in the Prospectus, at the time the Registration
Statement became effective and as of the Representation Date, did not, and will
not during the period specified in Section 3(b), include an untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein, in the light of the circumstances
in which they were made, not misleading; provided, however, that none of the
representations and warranties in this subsection shall apply to statements in
or omissions from the Registration Statement or the Prospectus made in reliance
upon and in conformity with information furnished to the Company in writing by
an Underwriter expressly for use in the Registration Statement or the Prospectus
or those exhibits to the Registration Statement that constitute the Statement of
Eligibility (Form T-1) of the Trustee.
(c) The accountants who certified or who will certify the financial
statements included in the Registration Statement are, or will be, with respect
to the Company and its subsidiaries, independent public accountants as required
by the Securities Act and the Regulations.
2
(d) The financial statements included in the Registration Statement
and Prospectus present fairly the financial position of the Company and its
consolidated subsidiaries as of the dates indicated and the results of their
operations for the periods specified and have been prepared in conformity with
generally accepted accounting principles in the United States applied on a basis
which is consistent in all material respects during the periods involved, and
the supporting schedules included in the Registration Statement present fairly
the information required to be stated therein.
(e) Neither the Company nor any subsidiary has a contingent liability
which is material to the Company and its subsidiaries considered as one
enterprise and which is not disclosed in the Registration Statement and
Prospectus.
(f) Since the respective dates as of which information is given in
the Registration Statement and the Prospectus except as may otherwise be stated
therein: (i) there has not been any material adverse change or any development
involving a prospective material adverse change, nor does the Company have
reason to believe that any material adverse change or any development involving
a prospective material adverse change will occur, in the condition, financial or
otherwise, of the Company and its subsidiaries considered as one enterprise, or
in the business, properties, operations or income of the Company and its
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business (a "Material Adverse Effect"), (ii) neither the
Company nor any of its subsidiaries has entered into a transaction, other than
transactions in the ordinary course of business, which is material in relation
to the Company and its subsidiaries considered as one enterprise, (iii) there
has not been any dividend or distribution of any kind declared, paid or made by
the Company on its capital stock other than normal cash dividends, (iv) neither
the Company nor any subsidiary has incurred any liabilities or obligations
(direct or contingent) which are material to the Company and its subsidiaries
considered as one enterprise, except in the ordinary course of business, (v)
there has not been any change in the capital stock of the Company (other than by
reason of the exercise of stock options outstanding at the latest date as of
which information is given in the Registration Statement or the Prospectus, the
conversion of preferred stock or debentures outstanding at the latest date as of
which information is given in the Registration Statement or the Prospectus, the
issuance of shares pursuant to the Company's employee stock purchase plan or
employee stock ownership plan), any material increase in the short-term
indebtedness of the Company and its subsidiaries or any material increase in the
long-term indebtedness of the Company and its subsidiaries considered as one
enterprise, (vi) no action, suit or proceeding, at law or in equity, is pending
or, to the knowledge of the Company, threatened against or affecting the Company
or any of its subsidiaries, and no proceedings are pending or, to the knowledge
of the Company, threatened against or affecting the Company or any of its
subsidiaries before or by any governmental commission, board or other
administrative agency, wherein an unfavorable decision, ruling or finding would
materially adversely affect the consummation of the transactions contemplated in
this Agreement and the other Operative Documents or result in a Material Adverse
Effect, (vii) neither the Company nor any of its subsidiaries has sustained a
loss of, or damage to, its properties (whether or not insured) which would
result in a Material Adverse Effect, and (viii) no labor disturbance by the
employees of the Company or any of its subsidiaries has arisen or been
threatened which might result in a Material Adverse Effect.
3
(g) The Company has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of Delaware with full
power and authority to own, lease and operate its properties, to conduct its
business as described in the Registration Statement, to issue and sell the
Securities and to enter into and perform the Operative Documents; each
subsidiary of the Company has been duly organized and is validly existing as an
organization in good standing under the laws of the jurisdiction of its
organization with full power to own, lease and operate its properties and
conduct its business as described in the Registration Statement; the Company and
each of its subsidiaries is duly qualified to transact business and is in good
standing in each of the jurisdictions in which the conduct of its business or
the ownership, leasing or operation of its properties or the existence of an
office requires such qualification, except where the failure to so qualify would
not result in a Material Adverse Effect; each subsidiary of the Company has
municipal consents or franchises, free from unduly burdensome restrictions or
those not customarily associated with such consents or franchises which,
together with its corporate powers, are adequate to enable it to carry on its
operations in the territory served by the subsidiary; and all of the issued and
outstanding capital stock of each subsidiary of the Company has been duly
authorized and validly issued and is fully paid and nonassessable, and the stock
of such subsidiaries owned by the Company is free and clear of any mortgages,
pledges, liens, encumbrances, claims or equities whatsoever (other than pledges
of stock of subsidiaries securing acquisition indebtedness not in excess of
$2,000,000 or as otherwise set forth or disclosed in the Registration Statement
or Prospectus).
(h) This Agreement has been duly authorized, executed and delivered
on behalf of the Company and is the valid and legally binding obligation of the
Company enforceable in accordance with its terms, except as enforcement thereof
may be limited by bankruptcy, insolvency or other laws relating to or affecting
enforcement of creditors' rights and by general equity principles.
(i) The Indenture has been duly authorized by the Company and when
executed and delivered by the Company will constitute the valid and binding
obligation of the Company enforceable in accordance with its terms, except as
enforcement thereof may be limited by bankruptcy, insolvency or other laws
relating to or affecting enforcement of creditors' rights and by general equity
principles and except as rights to indemnification, contribution or exculpation
thereunder may not be enforceable, and will conform in all material respects to
the descriptions thereof in the Prospectus.
(j) The Securities have been duly authorized by the Company and, at
the Closing Date, will have been validly executed by the Company and, when
authenticated, issued and delivered in the manner provided for in the Indenture,
will be entitled to the benefits of the Indenture and constitute valid and
binding obligations of the Company, except as enforcement thereof may be limited
by bankruptcy, insolvency or other laws relating to or affecting enforcement of
creditors' rights and by general equity principles and will conform in all
material respects to the description thereof in the Prospectus.
(k) The Company is not in violation of its certificate of
incorporation or bylaws, and neither the Company nor any of its subsidiaries is
in default in the performance or observance of any material obligation,
agreement, covenant or condition contained in any bond, debenture, note or other
evidence of indebtedness or in any contract, indenture against payment
4
therefor by the Underwriters, mortgage, loan agreement, lease, joint venture
agreement or other agreement or instrument to which the Company or any of its
subsidiaries is a party or by which any of them or any of their properties may
be bound, or in violation of any statute, order, rule, regulation, writ,
injunction or decree of any government, governmental instrumentality or court,
domestic or foreign, except in each case where the violation or default would
not result in a Material Adverse Effect. The compliance with the terms of this
Agreement and the other Operative Documents, the incurrence of the obligations
herein and therein set forth and the consummation of the transactions herein and
therein contemplated will not (i) violate the certificate of incorporation or
code of regulations or bylaws of the Company or any of its subsidiaries or (ii)
conflict with or result in a breach of or default in the performance or
observance of any obligation, agreement, covenant or condition contained in any
bond, debenture, note or other evidence of indebtedness or any contract,
indenture, mortgage, loan agreement, lease, joint venture agreement or other
agreement or instrument to which the Company or any of its subsidiaries is a
party or by which any of them or any of their properties may be bound or violate
any statute, order, rule, regulation, writ, injunction or decree of any
government, governmental instrumentality or court, domestic or foreign except,
in the case of clause (ii) immediately above, where the violation would not
result in a Material Adverse Effect and except that any such violation, breach,
default will not adversely affect the Company's ability to issue and sell the
Securities and fulfill its obligations under this Agreement and the Indenture.
(l) No approval of any court, governmental agency or public regulatory
body is necessary for the performance by the Company of its obligations under
this Agreement and the other Operative Documents, in connection with the
offering, issuance or sale of the Securities under this Agreement or the
consummation of the transactions contemplated by this Agreement and the other
Operative Documents, except such as may be required under state or federal
securities or "blue sky" laws and such as have already been received.
(m) There is no contract or document required to be described in the
Registration Statement or the Prospectus, or the documents incorporated by
reference therein or to be filed as an exhibit to the Registration Statement,
which is not described or filed as required.
(n) The Company or a subsidiary has good title to all of the
properties and assets reflected in the consolidated balance sheet of the Company
included in the Registration Statement, except properties and assets sold or
otherwise disposed of in the ordinary course of business after such date,
subject to no mortgages, liens, charges or encumbrances of any nature whatsoever
other than (i) as disclosed in the Registration Statement, (ii) defects and
encumbrances customarily found in the case of properties of like size and
character which do not impair the use of such properties by the Company or its
subsidiaries, or (iii) secured indebtedness in an amount not greater than
$500,000,000.
(o) The Company and its subsidiaries possess such permits, licenses,
approvals, consents and other authorizations (collectively, "Governmental
Licenses") issued by the appropriate federal, state, local or foreign regulatory
agencies or bodies necessary to conduct the business now operated by them and
material to them, taken as a whole; the Company and its subsidiaries are in
compliance with the terms and conditions of all such Governmental Licenses,
except where the failure so to comply would not, singly or in the aggregate,
result in a Material
5
Adverse Effect; all of the Governmental Licenses are valid and in full force
and effect, except when the invalidity of such Governmental Licenses or the
failure of such Governmental Licenses to be in full force and effect would not
result in a Material Adverse Effect; and neither the Company nor any of its
subsidiaries has received any notice of proceedings relating to the revocation
or modification of any such Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding, would
result in a Material Adverse Effect.
Any certificate signed by any officer of the Company or any of its
subsidiaries and delivered to the Underwriters or to counsel for the
Underwriters shall be deemed a representation and warranty by the Company to
each Underwriter as to the matters covered thereby.
SECTION 2. Purchase and Sale.
-----------------
(a) The obligation of the Underwriters to purchase severally and not
jointly, and the Company to sell, the Securities is evidenced by the Terms
Agreement. The Terms Agreement specifies the number, or aggregate principal
amount, and purchase price of the Securities, the names of the Underwriters
participating in the offering (subject to substitution as provided in Section 11
hereof) and the number or aggregate principal amount of Securities which each
severally has agreed to purchase, the purchase price to be paid by the
Underwriters, the initial public offering price of the Securities and any terms
of the Securities not already specified in the Indenture (including, but not
limited to, designation, denominations, current ratings, interest rates and
payment dates, maturity and early settlement provisions).
(b) Payment of the purchase price for the Securities to be purchased
by the Underwriters shall be made, against delivery of the Securities through
the facilities of The Depository Trust Company (the "Depository"), at such place
and time as set forth in the Terms Agreement. (The date designated for the
payment of the purchase price and the delivery of the Securities is referred to
herein as the "Closing Date").
(c) Payment for the Securities shall be by federal wire transfer in
same-day funds. The Securities shall be delivered to the Underwriters in the
form of one or more global securities registered in the name of the Depository
or its nominee. For the purpose of expediting the checking of the Securities by
the Representatives, the Company agrees to make the Securities available to the
Depository not later than the time specified in the Terms Agreement, on the
business day before the Closing Date.
SECTION 3. Covenants of the Company. The Company agrees that:
------------------------
(a) Immediately following the execution of the Terms Agreement, the
Company will prepare a supplement to the Prospectus (the "Prospectus
Supplement") setting forth the number or aggregate principal amount of
Securities covered thereby and their terms not otherwise specified in the
Indenture, the names of the Underwriters participating in the offering and the
principal amount of Securities which each severally has agreed to purchase, the
names of the Underwriters, if any, acting as co-managers in connection with the
offering, the price at which the Securities are to be purchased by the
Underwriters from the Company, the initial
6
public offering price, if any, the selling concession and reallowance, if
any, and such other information as the Representatives and the Company deem
appropriate in connection with the offering of the Securities. The Company will
promptly transmit copies of the Prospectus Supplement to the Commission for
filing pursuant to Rule 424 of the Regulations and during the period specified
in Section 3(b) will furnish to the Underwriters named therein as many copies of
the Prospectus and such Prospectus Supplement as the Representatives shall
reasonably request.
(b) If at any time during the period when a prospectus is required by
the Securities Act or the Regulations to be delivered in connection with the
sales of the Securities pursuant to this Agreement, any event shall occur as a
result of which it is necessary to further amend or supplement the Prospectus so
that it does not contain an untrue statement of material fact, or does not omit
to state a material fact necessary to make the statements therein, in the light
of the circumstances existing at the time it is delivered to a purchaser, not
misleading, or, if it shall be necessary at any such time to amend or supplement
the Registration Statement or the Prospectus in order to comply with the
requirements of the Securities Act or the Regulations, the Company will promptly
notify each Underwriter and prepare and file with the Commission such amendment
or supplement, whether by filing documents pursuant to the 1934 Act or
otherwise, as may be necessary in order to make the Prospectus not misleading or
cause the Registration Statement to comply with such requirements; provided that
reasonable advance notice is given to the Representatives by the Company of such
proposed filing and provided further that no such amendment or supplement will
be filed with the Commission to which the Representatives or counsel for the
Underwriters shall reasonably object.
(c) During the period specified in Section 3(b), the Company will
notify each Underwriter immediately and confirm the notice in writing (i) when
any amendment to the Registration Statement shall have become effective, (ii) of
the transmission, mailing or other delivery to the Commission for filing of any
supplement to the Prospectus or any document to be filed pursuant to the 1934
Act, (iii) of the receipt of any comments from the Commission with respect to
the Registration Statement or the Prospectus, (iv) of any request, written or
oral, by the Commission or any state securities regulatory authority for any
amendment to the Registration Statement or any amendment or supplement to the
Prospectus or for additional information and (v) of the issuance by the
Commission or any state securities regulatory authority of any stop order
suspending the effectiveness of the Registration Statement or of the initiation
of any proceedings for that purpose. The Company will make every reasonable
effort to prevent the issuance by the Commission or any state securities
regulatory authority of any stop order during the period specified in Section
3(b) and, if any such stop order shall at any time be issued, to obtain the
lifting thereof at the earliest possible moment.
(d) The Company will deliver to each Representative, as soon as
available, one signed copy of the Registration Statement as originally filed and
one signed copy of all amendments thereto filed during the period specified in
Section 3(b) (in each case including all exhibits and other documents filed
therewith or incorporated by reference therein). The copy of the Registration
Statement and each amendment thereto furnished to the Representatives will be
identical to the electronically transmitted copies thereof filed with the
Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval
system ("▇▇▇▇▇"), except to the extent permitted by Regulation S-T.
7
(e) During the period specified in Section 3(b), the Company will
deliver to the Underwriters, in accordance with the Representatives'
instructions, as many copies of the Prospectus as the Underwriters may
reasonably request. The Prospectus and any amendments or supplements thereto
furnished to the Underwriters will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to ▇▇▇▇▇, except
to the extent permitted by Regulation S-T.
(f) The Company, during the period specified in Section 3(b), will
file promptly all documents required to be filed with the Commission pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the 1934 Act; provided that advance notice
of such filing is provided to the Underwriters and to counsel for the
Underwriters.
(g) The Company will make generally available to its security holders
as soon as practicable, but not later than 90 days after the close of the period
covered thereby, an earnings statement (in form complying with the provisions of
Section 11(a) of the Securities Act and Rule 158 promulgated under the
Securities Act) covering a period of at least 12 months commencing with the
first fiscal quarter of the Company occurring after the effective date of the
Registration Statement and the filing of each subsequent Annual Report on Form
10-K by the Company.
(h) The Company will endeavor, in cooperation with the Underwriters,
to qualify the Securities for offering and sale under the applicable securities
laws of such jurisdictions as the Representatives may designate; provided,
however, that the Company shall not be obligated to file any general consent to
service of process or to qualify as a foreign corporation or as a dealer in
securities in any jurisdiction in which it is not so qualified. In each
jurisdiction in which Securities have been qualified as above provided, the
Company will make and file such statements and reports in each year as are or
may be reasonably required by the laws thereof.
(i) During the period specified in Section 3(b), the Company will not
take, directly or indirectly, any action designed to or that would constitute or
that might reasonably be expected to cause or result, under the 1934 Act or
otherwise, in stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Securities (other than
stabilization and other activities that may be taken by the Underwriters and
which are described under the caption "Underwriting" in the Prospectus or any
supplement to the Prospectus).
SECTION 4. Payment of Expenses. The Company will pay all expenses
-------------------
incident to the performance of its obligations under this Agreement, including
expenses in connection with (i) the preparation, printing and filing of the
Registration Statement and Prospectus and the printing of this Agreement, the
Securities and the Indenture, (ii) the issuance and delivery of the Securities
to the Underwriters, including transfer agents' and registrars' fees, (iii) the
fees and disbursements of the Company's counsel and accountants, (iv) the fees
and disbursements of the Trustee and rating agencies, (v) the qualification of
the Securities under securities laws in accordance with the provisions of
Section 3(h), including filing fees and the fees and disbursements of counsel
for the Underwriters in connection therewith and in connection with the
preparation of the Blue Sky Memorandum (which shall not in any case
8
exceed $5,000 without the written consent of the Company), (vi) the printing and
delivery to the Underwriters, in quantities as hereinabove stated, of copies of
the Registration Statement and any amendments thereto and of the Prospectus and
any amendments or supplements thereto and (vii) the printing and delivery to the
Underwriters of copies of the Blue Sky Memorandum to be prepared by counsel for
the Underwriters.
Except as expressly provided in this Section 4, Section 7 and
Section 8, the Underwriters will pay all of their costs and expenses, including
fees and disbursements of their counsel, transfer taxes payable on resale of any
of the Securities by them and any advertising expense connected with any offers
they may make.
If this Agreement is cancelled by the Underwriters in accordance with
the provisions of Section 5 (other than clause (b)(ii) of Section 5) or by the
Company in accordance with the provisions of Section 6 or is terminated by the
Underwriters in accordance with the provisions of Section 10(a)(i), the Company
shall reimburse the Underwriters for all of their out-of-pocket expenses,
including the reasonable fees and disbursements of counsel for the Underwriters.
SECTION 5. Conditions of Underwriters' Obligations. The several
---------------------------------------
obligations of the Underwriters hereunder to purchase and pay for the Securities
on the Closing Date are subject to the accuracy, as of the date of the Agreement
and as of the Closing Date, of the representations and warranties of the
Company, to the performance by the Company of its obligations hereunder, and to
the following conditions:
(a) At the Closing Date (i) no stop order suspending the effectiveness
of the Registration Statement shall have been issued under the Securities Act or
proceedings therefor initiated or threatened by the Commission and any request
on the part of the Commission for additional information shall have been
complied with to the reasonable satisfaction of counsel to the Underwriters,
(ii) the Prospectus containing information relating to the description of the
Securities, the specific method of distribution and similar matters shall have
been filed with the Commission in accordance with Rule 424(b)(1), (2), (3), (4)
or (5), as applicable (or any required post-effective amendment providing such
information shall have been filed and declared effective in accordance with the
requirements of Rule 430A), or, if the Company has elected to rely upon Rule 434
of the Regulations under the Securities Act, a term sheet including the
information, if any, deemed to be part thereof pursuant to Rule 434 of the
Regulations under the Securities Act shall have been filed with the Commission
in accordance with Rule 424(b)(7), (iii) the debt securities or preferred stock
of the Company shall not have had the rating assigned to them by any nationally
recognized securities rating agency lowered from the rating in place at the time
of the execution of the Terms Agreement, (iv) there shall not have come to the
attention of the Representatives any facts that would cause the Representatives
to believe that the Prospectus, together with the Prospectus Supplement, at the
time it was required to be delivered to a purchaser of the Securities, to have
contained an untrue statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances existing at such time, not misleading, and (v) there shall not
have been any event resulting in a Material Adverse Effect.
(b) At the Closing Date, the Underwriters shall have received:
9
(i) The favorable opinion of ▇▇▇▇▇ ▇▇▇▇ LLP, counsel for the
Company, dated the Closing Date, in form and substance satisfactory to
counsel for the Underwriters, to the effect that:
(A) the Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the
State of Delaware, and has full corporate power and authority to
conduct the business in which it is engaged, to own, lease and
operate the properties used by it in such business, to issue and
sell the Securities and to enter into and perform this Agreement
and the other Operative Documents;
(B) this Agreement has been duly authorized by, and duly
executed and delivered on behalf of, the Company;
(C) the Indenture has been duly authorized, executed and
delivered by the Company, and (assuming due authorization,
execution and delivery thereof by the Trustee) constitutes the
valid and binding agreement of the Company, enforceable in
accordance with its terms, except as enforcement thereof may be
limited by bankruptcy, insolvency or other laws relating to or
affecting enforcement of creditors' rights and by general equity
principles;
(D) the Securities are in the form authorized in the
Indenture; the Securities have been duly authorized by all
necessary corporate action and, when the Securities have been
executed and authenticated as specified in the Indenture and
delivered against payment pursuant to this Agreement, will be
valid and binding obligations of the Company, enforceable in
accordance with their terms, except as enforcement thereof may be
limited by bankruptcy, insolvency or other laws relating to or
affecting enforcement of creditors' rights and by general equity
principles, and the holders of the Securities will be entitled to
the benefits of the Indenture;
(E) the Indenture and the Securities conform in all material
respects to the descriptions thereof in the Prospectus and the
applicable Prospectus Supplement and are in substantially the
form filed or incorporated by reference, as the case may be, as
an exhibit to the Registration Statement;
(F) the Indenture is qualified under the 1939 Act;
(G) no approval, authorization, consent or order of, or
registration or filing with, any court, governmental agency or
other public board or body is legally required for the issuance
and sale of the Securities by the Company or the performance of
this Agreement and the other Operative Documents, and the
transactions contemplated thereby, by the
10
Company, except such as may be required under State or federal
securities or "blue sky" laws and such as have already been
received;
(H) the Registration Statement is effective under the
Securities Act, and, to the best of their knowledge, no stop
order suspending the effectiveness of the Registration Statement
has been issued and no proceedings for a stop order are pending
or threatened under Section 8(d) of the Securities Act;
(I) at the time the Registration Statement became effective
and as of the date of the Terms Agreement, the Company satisfied
the requirements under the Securities Act for use of a
Registration Statement on Form S-3, the Registration Statement
(other than the financial statements and data included therein,
the Statement of Eligibility (Form T-1) of the Trustee, and the
documents and other information incorporated therein by
reference, as to which no opinion need be rendered) complied as
to form in all material respects with the requirements of the
Securities Act, the 1939 Act and the Regulations regarding
registration statements on Form S-3 and related prospectuses, and
while not assuming responsibility for the accuracy, completeness
or fairness of the statements contained in the Registration
Statement or the Prospectus (other than as set forth in
paragraphs (E) and (L)), nothing has come to their attention that
would lead them to believe that the Registration Statement (other
than the financial statements and data included therein and the
Statement of Eligibility (Form T-1) of the Trustee, as to which
no opinion need be rendered), at the time it became effective (or
if an amendment to the Registration Statement or an annual report
on Form 10-K has been filed by the Company with the Commission
subsequent to the effectiveness of the Registration Statement, at
the time of the most recent filing), and as of the date of the
Terms Agreement, contained an untrue statement of a material fact
or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading, or
that the Prospectus (other than the financial statements and data
included therein and the Statement of Eligibility (Form T-1) of
the Trustee, as to which no opinion need be rendered), at the
date of the Terms Agreement and at the Closing Date, 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, in the light of the
circumstances under which they were made, not misleading;
(J) to the best of their knowledge, there are no contracts,
instruments or documents of a character required to be described
in the Registration Statement or to be filed as exhibits thereto
other than those described or filed;
11
(K) to the best of their knowledge, there are no legal or
governmental proceedings pending or threatened of a character
which should be disclosed in the Registration Statement;
(L) the statements in the Prospectus under the captions
"Description of the Senior Notes" and "Federal Income Tax
Considerations" have been reviewed by them, fairly summarize and
fairly present the information required to be set forth therein
with respect to the Securities in all material respects;
(M) neither the issuance and sale of the Securities by the
Company nor the execution, delivery and performance of this
Agreement and the other Operative Documents and the consummation
by the Company of the transactions contemplated thereby, will
conflict with or result in a breach of, or constitute a default
under, any of the terms, conditions or provisions of (i) the
certificate of incorporation or bylaws of the Company or any of
its subsidiaries, (ii) any agreement or instrument known to such
counsel to which the Company or any of its subsidiaries is a
party or by which the Company or any of its subsidiaries or any
of their properties is bound or violate any statute, order, rule,
regulation, writ, injunction or decree of any government,
governmental instrumentality or court, domestic or foreign,
except in the case of clause (ii) immediately above, where
violation would not result in a Material Adverse Effect, and
except that any such violation, breach, default will not
adversely affect the Company's ability to issue and sell the
Securities and fulfill its obligations under this Agreement and
the Indenture;
(N) the Company is not an "investment company" or an entity
"controlled" by an "investment company" as such terms are defined
in the Investment Company Act of 1940, as amended.
(ii) The favorable opinion of Shearman & Sterling, counsel for
the Underwriters, dated the Closing Date, with respect to such matters
as requested by the Underwriters.
(iii) A certificate signed by any two of the Chairman and Chief
Executive Officer, President, an Executive Vice President, a Senior
Vice President, Treasurer or the Controller of the Company, dated the
Closing Date, to the effect that (i) there has not been any event
resulting in a Material Adverse Effect; (ii) they have read and are
familiar with the Registration Statement; (iii) as of the date of the
Terms Agreement, the Registration Statement and the Prospectus did not
contain an untrue statement of a material fact and did not omit to
state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances in
which they were made, not misleading; (iv) since the effective date of
the Registration Statement, no event has occurred which should have
been set forth in an amendment or supplement to the Prospectus but
which has not been set forth; and (v) at the Closing Date, the
12
representations and warranties set forth in Section 1 of the Agreement
are true and correct.
(c) The Underwriters shall have received from PricewaterhouseCoopers
LLP, a letter, dated as of the Closing Date in form and substance satisfactory
to the Underwriters, to the effect that:
(i) they are independent certified public accountants with
respect to the Company and its subsidiaries within the meaning of the
Securities Act and the Regulations and are in compliance with the
requirements for the qualification of accountants under Rule 2-01 of
Regulation S-X of the Regulations;
(ii) on the basis of procedures consisting of a reading of the
unaudited interim financial statements of the Company set forth in the
most recent quarterly report on Form 10-Q filed by the Company
pursuant to the 1934 Act and certain financial information of the
Company contained in the Prospectus, a reading of the minutes of all
meetings of the stockholders and directors of the Company and the
Audit Committee of the Company's Board of Directors since December 31,
2001, inquiries of certain officials of the Company responsible for
financial and accounting matters, a review of interim financial
information in accordance with standards established by the American
Institute of Certified Public Accountants in Statement on Auditing
Standards No. 71, Interim Financial Information, and such other
inquiries and procedures as may be specified in such letter, nothing
came to their attention that caused them to believe that the unaudited
interim financial statements of the Company set forth in the most
recent quarterly report on Form 10-Q filed by the Company pursuant to
the 1934 Act and certain financial information of the Company
contained in the Prospectus do not comply as to form in all material
respects with applicable accounting requirements of the 1934 Act and
1934 Act Regulations or that any material modifications should be made
to such financial statements for them to be in conformity with
generally accepted accounting principles;
(iii) they confirm, as of the date of such letter (or, with
respect to matters involving changes or developments since the
respective dates as of which specified financial information is given
or incorporated in the Prospectus, as of a date not more than five
days prior to the date of such letter), their conclusions and findings
with respect to the financial information and other matters covered by
its letter delivered to you and dated as of the date of this
Agreement.
(d) At the Closing Date, counsel for the Underwriters shall have been
furnished with such other documents, certificates and opinions as they may
reasonably require for the purpose of enabling them to pass upon the issuance
and sale of the Securities as herein contemplated and related proceedings, or in
order to evidence the accuracy or completeness of any of the representations or
warranties, or the fulfillment of any of the conditions, herein contained; and
all proceedings taken by the Company in connection with the issuance and sale of
the Securities as herein contemplated shall be satisfactory in form and
substance to the Underwriters and counsel for the Underwriters.
13
If any of the conditions specified in this Section shall not have been
fulfilled when and as required by this Agreement to be fulfilled, this Agreement
and all obligations of the Underwriters hereunder may be cancelled by the
Underwriters by notifying the Company of such cancellation in writing or by
telegram at any time at or prior to the Closing Date, and any such cancellation
shall be without liability of any party to this Agreement to any other party to
this Agreement except as provided in Sections 4, 7 and 8 hereof.
SECTION 6. Conditions of Company's Obligation. The obligation of the
----------------------------------
Company to issue and sell the Securities at the Closing Date is subject to the
condition that on the Closing Date no stop order suspending the effectiveness of
the Registration Statement is in effect or proceedings therefor initiated or
threatened.
SECTION 7. Indemnification.
---------------
(a) The Company agrees to indemnify and hold harmless each Underwriter
and each person, if any, who controls an Underwriter within the meaning of
Section 15 of the Securities Act or Section 20 of the 1934 Act, as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever arising out of any untrue statement or alleged
untrue statement of a material fact included in the Registration
Statement (or any amendment thereto), or the omission or alleged
omission therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading or arising out
of any untrue statement or alleged untrue statement of a material fact
included in any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto) or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading, unless such untrue statement or omission or such
alleged untrue statement or omission was made in reliance upon and in
conformity with written information furnished to the Company by an
Underwriter through the Representatives expressly for use in the
Registration Statement (or any amendment thereto) or such preliminary
prospectus or the Prospectus (or any amendment or supplement thereto);
(ii) against any and all loss, liability, claim, damage and
expense whatsoever to the extent of the aggregate amount paid in
settlement of any litigation or investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, if (subject to Section 7(d)
below) such settlement is effected with the written consent of the
Company; and
(iii) against any and all expense whatsoever (including the fees
and disbursements of counsel chosen by the Underwriters) reasonably
incurred in investigating, preparing or defending against any
litigation or investigation or proceeding by any governmental agency
or body, commenced or threatened, or any claim whatsoever based upon
any such untrue statement or omission, or any
14
such alleged untrue statement or omission, to the extent that any such
expense is not paid under (i) or (ii) above,
provided, however, that the foregoing indemnity agreement with respect
to any preliminary prospectus shall not inure to the benefit of any Underwriter
from whom the person asserting any such losses, liabilities, claims, damages or
expenses purchased Securities, or any person controlling such Underwriter, if it
shall be established that a copy of the Prospectus was not sent or given by or
on behalf of such Underwriter to such person, if required by law so to have been
delivered, at or prior to the written confirmation of the sale of the Securities
to such person, and if the Prospectus would have cured the defect giving rise to
such losses, liabilities, claims, damages or expenses, unless such failure is
the result of noncompliance by the Company with Sections 3(a), 3(b) or 3(c).
(b) Each Underwriter severally agrees that it will indemnify and hold
harmless the Company, its directors, and each of its officers who signed the
Registration Statement and each person, if any who controls the Company within
the meaning of Section 15 of the Securities Act or Section 20 of the 1934 Act
against any and all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a) of this Section, as incurred, but only
with respect to statements or omissions made in the Registration Statement (or
any amendment thereto) or any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity with written
information furnished to the Company by such Underwriter expressly for use in
the Registration Statement (or any amendment thereto) or such preliminary
prospectus or the Prospectus (or any amendment or supplement thereto).
(c) Each indemnified party shall give prompt notice to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve it from (i) any liability which it may have otherwise
than on account of this indemnity agreement or (ii) under paragraphs (a) and (b)
above unless and to the extent it was materially prejudiced by such failure to
notify. An indemnifying party may participate at its own expense in the defense
of such action. In no event shall the indemnifying parties be liable for the
fees and expenses of more than one counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances.
No indemnifying party shall, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 7 or Section 8 hereof (whether or not the indemnified parties
are actual or potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified party from all
liability arising out of such litigation, investigation, proceeding or claim and
(ii) does not include a statement as to or an admission of fault, culpability or
a failure to act by or on behalf of any indemnified party.
(d) If at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel, such indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by
15
Section 7(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into, and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
SECTION 8. Contribution. If the indemnification provided for in
------------
Section 7 hereof is for any reason unavailable to or insufficient to hold
harmless an indemnified party in respect of any losses, liabilities, claims,
damages or expenses referred to therein, then each indemnifying party shall
contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by such indemnified party, as incurred, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters on the other hand from the offering
of the Securities pursuant to this Agreement or (ii) if the allocation provided
by clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and of the
Underwriters on the other hand in connection with the statements or omissions
which resulted in such losses, liabilities, claims, damages or expenses, as well
as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and the
Underwriters on the other hand in connection with the offering of the Securities
pursuant to this Agreement shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of the Securities
pursuant to this Agreement (before deducting expenses) received by the Company
and the total underwriting discount received by the Underwriters bear to the
aggregate initial public offering price of the Securities.
The relative fault of the Company on the one hand and the Underwriters
on the other hand shall be determined by reference to, among other things,
whether any such untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 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. The aggregate amount
of losses, liabilities, claims, damages and expenses incurred by an indemnified
party and referred to above in this Section shall be deemed to include, subject
to the limitations set forth above, any legal or other expenses reasonably
incurred by such indemnified party in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based upon any
such untrue or alleged untrue statement or omission or alleged omission.
16
Notwithstanding the provisions of this Section, no Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of any such untrue or
alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the Securities Act or Section 20
of the 1934 Act shall have the same rights to contribution as such Underwriter,
and each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the Securities Act or Section 20 of the 1934 Act
shall have the same rights to contribution as the Company. The Underwriters'
respective obligations to contribute pursuant to this Section are several in
proportion to the principal amount of Securities set forth opposite their
respective names in the Terms Agreement and not joint.
SECTION 9. Representations, Warranties and Agreements To Survive
-----------------------------------------------------
Delivery. All representations, warranties and agreements contained in this
--------
Agreement or contained in certificates of officers of the Company submitted
pursuant hereto shall remain operative and in full force and effect, regardless
of any investigation made by or on behalf of an Underwriter or any controlling
person of an Underwriter, or by or on behalf of the Company, and shall survive
delivery of any of the Securities to the Underwriters.
SECTION 10. Termination of Agreement.
------------------------
(a) The Underwriters shall also have the right to terminate this
Agreement by notice to the Company at any time at or prior to the Closing Date
(i) if there has been, since the time of execution of this Agreement or since
the respective dates as of which information is given in the Registration
Statement and Prospectus (without regard, however, to any amendment or
supplement thereto subsequent to the date of this Agreement), any Material
Adverse Effect, or (ii) if there has occurred any material adverse change in the
financial markets in the United States or the international financial markets,
any outbreak of hostilities or escalation thereof or other calamity or crisis or
any change or development involving a prospective change in national or
international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the judgment of the Representative(s),
impracticable or inadvisable to market the Securities or to enforce contracts
for the sale of the Securities, (iii) if trading in any securities of the
Company has been suspended or materially limited by the Commission or the New
York Stock Exchange, or if trading generally on the American Stock Exchange, the
New York Stock Exchange, or in the NASDAQ National Market has been suspended or
materially limited, or minimum or maximum prices for trading have been fixed, or
maximum ranges for prices have been required, by any of said exchanges or by
such system or by order of the Commission, the National Association of
Securities Dealers, Inc. or any other governmental authority, or a material
disruption has occurred in commercial banking or securities settlement or
17
clearance services in the United States, or (iv) if a banking moratorium has
been declared by either federal or New York authorities.
(b) If this Agreement is terminated pursuant to this Section, such
termination shall be without liability of any party to any other party except as
otherwise provided in this Agreement in Section 4 hereof, and provided further
that Sections 1, 4, 7, 8, 12, 13 and 14 shall survive such termination and
remain in full force and effect.
SECTION 11. Default. If any Underwriter shall fail at the Closing Date
-------
to purchase the Securities which it is obligated to purchase hereunder (the
"Defaulted Securities"), the Representatives (or the Representative not in
default if the default is by a Representative) shall have the right, but not the
obligation, within 24 hours thereafter, to make arrangements for one or more of
the Underwriters not in default to purchase all, but not less than all, of the
Defaulted Securities upon the terms herein set forth; if, however, the
Representatives (or the Representatives not in default if the default is by a
Representative) shall not have completed such arrangements within such 24-hour
period, then:
(a) if the number of Defaulted Securities does not exceed 10% of the
number of Securities to be purchased on such date, the non-defaulting
Underwriters shall be obligated, each severally and not jointly, to purchase the
full amount thereof in the proportions that their respective underwriting
obligations hereunder bear to the underwriting obligations of all non-defaulting
Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the number of
Securities to be purchased on such date, this Agreement shall terminate without
liability on the part of the Company or any non-defaulting Underwriter except as
provided in Section 4.
Nothing in this Section and no action taken pursuant to this Section
shall relieve a defaulting Underwriter from liability in respect of any default
of such Underwriter under this Agreement.
In the event of a default as set forth in this Section by an
Underwriter which does not result in termination of this Agreement, either the
Representatives or the Company shall have the right to postpone the Closing
Date, for a period of not exceeding five business days in order that any
required changes in the Registration Statement or Prospectus or in any other
documents or arrangements may be effected. As used herein, the term
"Underwriter" includes any person substituted for an Underwriter under this
Section.
SECTION 12. Notices. Except as otherwise specifically provided herein,
-------
all communications hereunder shall be in writing or by facsimile and, if to the
Underwriters, shall be mailed or delivered to the Representatives to the
addresses specified in the Terms Agreement, and if to the Company, shall be
mailed or delivered to it at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (facsimile no: (▇▇▇) ▇▇▇-▇▇▇▇).
SECTION 13. Parties. This Agreement shall inure to the benefit of and
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be binding upon the Company and any Underwriter who becomes a party hereto and
their respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the parties hereto and their respective
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successors and the controlling persons and the directors and officers referred
to in Sections 8 and 9, any legal or equitable right, remedy or claim under or
in respect of this Agreement or any provision herein contained. This Agreement
and all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the parties hereto and their respective successors and said
controlling persons, directors and officers and for the benefit of no other
person, firm or corporation. No purchaser of Securities from an Underwriter
shall be deemed to be a successor by reason merely of such purchase.
SECTION 14. Governing Law. This Agreement shall be governed by and
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construed in accordance with the laws of the State of New York.
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