SHARES COPA HOLDINGS, S.A. CLASS A COMMON STOCK, NO PAR VALUE UNDERWRITING AGREEMENT
EXHIBIT 1.1
SHARES
CLASS A COMMON STOCK, NO PAR VALUE
May , 2008
May , 2008
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Ladies and Gentlemen:
Continental Airlines, Inc. (the “Selling Shareholder”) proposes to sell to the several
Underwriters named in Schedule I hereto (the “Underwriters”), an aggregate of shares of Class A
Common Stock, without par value (the “Firm Shares”) of Copa Holdings, S.A., a Panamanian
corporation (the “Company”). ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated (“▇▇▇▇▇▇ ▇▇▇▇▇▇▇”) shall act as
representative (the “Representative”) of the several Underwriters.
The Selling Shareholder also proposes to sell to the several Underwriters not more than an
additional shares of Class A Common Stock, without par value, of the Company (the “Additional
Shares”) if and to the extent that you, as Representative, shall have determined to exercise, on
behalf of the Underwriters, the right to purchase such Additional Shares granted to the
Underwriters in Section 3 hereof. The Firm Shares and the Additional Shares are hereinafter
collectively referred to as the “Shares.” The outstanding shares of Class A Common Stock, without
par value, of the Company, are hereinafter referred to as the “Common Stock.”
The Company has filed with the Securities and Exchange Commission (the “Commission”) a
registration statement on Form F-3 (File No. 333- ), including a prospectus, relating to the
Shares. The registration statement as amended at the time it becomes effective, including the
information (if any) deemed to be part of the registration statement at the time of effectiveness
pursuant to Rule 430A under the Securities Act of 1933, as amended (the “Securities Act”), is
hereinafter referred to as the “Registration Statement”; the prospectus in the form first used to
confirm sales of Shares (or if no prospectus is delivered to confirm sales, the corresponding form
of prospectus referred to in Rule 173 under the Securities Act) is hereinafter referred to as the
“Prospectus.” If the Company has filed an abbreviated registration statement to register additional
shares of Common Stock pursuant to Rule 462(b) under the Securities Act (the “Rule 462 Registration
Statement”), then any reference herein to the term “Registration Statement” shall be deemed to
include such Rule 462 Registration Statement.
For purposes of this Agreement, “free writing prospectus” has the meaning set forth in Rule
405 under the Securities Act, “Time of Sale Prospectus” means the preliminary prospectus, together
with the free writing prospectuses, if any, as each are identified in Schedule II hereto and the
price to the public and the number of shares on the cover page of the Prospectus, considered
together, and “broadly available road show” means a “bona fide electronic road show” as defined in
Rule 433(h)(5) under the Securities Act that has been made
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available without restriction to any person. As used herein, the terms “Registration
Statement,” “preliminary prospectus,” “Time of Sale Prospectus” and Prospectus shall include the
documents, if any, incorporated by reference therein. The terms “supplement,” “amendment,” and
“amend” as used herein with respect to the Registration Statement, the Prospectus, the Time of Sale
Prospectus or any free writing prospectus shall include all documents subsequently filed by the
Company with the Commission pursuant to the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), that are incorporated by reference therein.
1. Representations and Warranties of the Company and Compañía Panameña de Aviación, S.A. Each
of the Company and Compañía Panameña de Aviación, S.A. (“Copa Airlines”) represents and warrants to
and agrees with each of the Underwriters that:
(a) The Registration Statement has become effective; no stop order suspending the
effectiveness of the Registration Statement is in effect, and no proceedings for such purpose are
pending before or, to the Company’s knowledge, threatened by the Commission.
(b) (i) Each document, if any, filed or to be filed pursuant to the Exchange Act and
incorporated by reference in the Time of Sale Prospectus or the Prospectus complied or will comply
when so filed in all material respects with the Exchange Act and the applicable rules and
regulations of the Commission thereunder, (ii) the Registration Statement, when it became
effective, did not contain and, as amended or supplemented, if applicable, will not 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, (iii) the Registration Statement and
the Prospectus comply and, as amended or supplemented, if applicable, will comply in all material
respects with the Securities Act and the applicable rules and regulations of the Commission
thereunder, (iv) the Time of Sale Prospectus does not, and at the time of each sale of the Shares
in connection with the offering and at the Closing Date (as defined in Section 5), the Time of Sale
Prospectus, as then amended or supplemented by the Company, if applicable, will not, contain any
untrue statement of a material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were made, not misleading,
(v) each broadly available road show, if any, when considered together with the Time of Sale
Prospectus, does not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances under which they
were made, not misleading and (vi) the Prospectus does not contain and, as amended or supplemented,
if applicable, will not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances under which they
were made, not misleading, except that the representations and warranties set forth in this
paragraph do not apply to statements or omissions in the Registration Statement, the Time of Sale
Prospectus, any broadly available road show or the Prospectus based upon information relating to
any Underwriter furnished to the Company in writing by such Underwriter through you expressly for
use therein or by a Selling Shareholder expressly for use in the preparation of the answers to Item
7 of Form 20-F.
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(c) The Company is a “well-known seasoned issuer” (as defined in Rule 405 under the Securities
Act) and the Company is not an “ineligible issuer,” as defined in Rule 405 of the Securities Act,
in connection with the offering pursuant to Rules 164, 405 and 433 under the Securities Act. Any
free writing prospectus that the Company is required to file pursuant to Rule 433(d) under the
Securities Act has been, or will be, filed with the Commission in accordance with the requirements
of the Securities Act and the applicable rules and regulations of the Commission thereunder. Each
free writing prospectus that the Company has filed, or is required to file, pursuant to Rule 433(d)
under the Securities Act or used or referred to by the Company complies or will comply in all
material respects with the requirements of the Securities Act and the applicable rules and
regulations of the Commission thereunder. Except for the free writing prospectuses, if any,
identified in Schedule II hereto, and electronic road shows, if any, furnished to you before first
use, the Company has not prepared, used or referred to, and will not, without your prior consent,
prepare, use or refer to, any free writing prospectus.
(d) The Company has been duly incorporated, is validly existing as a corporation (sociedad
anónima) in good standing under the laws of the Republic of Panama (“Panama”), has the corporate
power and authority to own its property and to conduct its business as described in the Time of
Sale Prospectus and is duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or leasing of property requires
such qualification, except to the extent that the failure to be so qualified or be in good standing
or to have such power an authority would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(e) Each subsidiary of the Company (including Copa Airlines) has been duly incorporated, is
validly existing as a corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its property and to conduct its
business as described in the Time of Sale Prospectus and is duly qualified to transact business and
is in good standing in each jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that the failure to be so
qualified or be in good standing or to have such power and authority would not have a material
adverse effect on the Company and its subsidiaries, taken as a whole; all of the issued shares of
capital stock of each subsidiary of the Company have been duly and validly authorized and issued,
are fully paid and non-assessable and are owned directly by the Company (with the exception of the
minority interests therein, as described in the Time of Sale Prospectus), free and clear of all
liens and similar encumbrances, except as described in the Time of Sale Prospectus.
(f) This Agreement has been duly authorized, executed and delivered by the Company and Copa
Airlines.
(g) The authorized capital stock of the Company conforms in all material respects as to legal
matters to the description thereof contained in each of the Time of Sale Prospectus and the
Prospectus.
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(h) The shares of Common Stock (including the Shares to be sold by the Selling Shareholder)
have been duly authorized and are validly issued, fully paid and non-assessable.
(i) The execution and delivery by the Company of, and the performance by the Company of its
obligations under, this Agreement will not contravene any provision of (i) the certificate of
incorporation or by-laws of the Company, (ii) any agreement or other instrument binding upon the
Company or any of its subsidiaries or (iii) applicable law or any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the Company or any subsidiary, except
in the case of (ii) and (iii), as would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole. No consent, approval, authorization or order of, or qualification
with, any governmental body or agency is required for the performance by the Company of its
obligations under this Agreement, except (i) such as may be required by the securities or Blue Sky
laws of the various states in connection with the offer and sale of the Shares or (ii) such as
would not have a material adverse effect on the Company and its subsidiaries, taken as a whole, or
on the Company’s ability to perform its obligations under the Agreement.
(j) The execution and delivery by Copa Airlines of, and the performance by Copa Airlines of
its obligations under, this Agreement will not contravene any provision of (i) the certificate of
incorporation or by-laws of Copa Airlines, (ii) any agreement or other instrument binding upon Copa
Airlines or (iii) applicable law or any judgment, order or decree of any governmental body, agency
or court having jurisdiction over Copa Airlines, except in the case of (ii) and (iii), as would not
have a material adverse effect on Copa Airlines. No consent, approval, authorization or order of,
or qualification with, any governmental body or agency is required for the performance by Copa
Airlines of its obligations under this Agreement, except (i) such as may be required by the
securities or Blue Sky laws of the various states in connection with the offer and sale of the
Shares or (ii) such as would not have a material adverse effect on Copa Airlines or on Copa
Airlines’ ability to perform its obligations under the Agreement.
(k) There has not occurred any material adverse change in the condition, financial or
otherwise, or in the earnings, business, operations or prospects of the Company and its
subsidiaries, taken as a whole, from that set forth in the Time of Sale Prospectus.
(l) There are no legal or governmental proceedings pending or, to the Company’s knowledge,
threatened to which the Company or any of its subsidiaries is a party or to which any of the
properties of the Company or any of its subsidiaries is subject that are required to be described
in the Registration Statement or the Prospectus and are not so described and there are no statutes,
regulations, contracts or other documents that are required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits to the Registration Statement that are not
described or filed as required. The Time of Sale Prospectus does not contain any description of
the foregoing matters that is materially different from those contained in the Prospectus.
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(m) Each preliminary prospectus filed as part of the registration statement as originally
filed or as part of any amendment thereto, or filed pursuant to Rule 424 under the Securities Act,
complied when so filed in all material respects with the Securities Act and the applicable rules
and regulations of the Commission thereunder.
(n) Neither the Company nor Copa Airlines is, and immediately after giving effect to the
offering and sale of the Shares neither of them will be, required to register as an “investment
company” as such term is defined in the Investment Company Act of 1940, as amended.
(o) Except as described in the Time of Sale Prospectus, the Company and 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
all 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 in each case 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 on the Company and its subsidiaries, taken as a
whole.
(p) There are no costs or liabilities associated with Environmental Laws (including, without
limitation, any capital or operating expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any permit, license or approval, any related constraints on
operating activities and any potential liabilities to third parties) that would, singly or in the
aggregate, have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(q) There are no contracts, agreements or understandings either between the Company or Copa
Airlines and any person granting such person the right to require the Company or Copa Airlines to
file a registration statement under the Securities Act with respect to any securities of the
Company or Copa Airlines or to require the Company to include such securities with the Shares
registered pursuant to the Registration Statement, except as contemplated in the Second Amended and
Restated Registration Rights Agreement by and among the Company, Corporación de Inversiones Aéreas,
S.A. (“CIASA”) and the Selling Shareholder dated July 5, 2006, including the supplemental agreement
by and among the Company, CIASA and the Selling Shareholder, dated May , 2008.
(r) Subsequent to the respective dates as of which information is given in each of the
Registration Statement, the Time of Sale Prospectus and the Prospectus, (i) the Company and its
subsidiaries have not incurred any material liability or obligation, direct or contingent, nor
entered into any material transaction; (ii) the Company has not purchased any of its outstanding
capital stock, nor declared, paid or otherwise made any dividend or distribution of any kind on its
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capital stock other than ordinary and customary dividends; (iii) there has not been any
material change in the capital stock, short-term debt or long-term debt of the Company and its
subsidiaries, except in each case as described in each of the Registration Statement, the Time of
Sale Prospectus and the Prospectus, respectively; and (iv) there has been no prohibition or
suspension of the operation of either the Company’s or Copa Airlines’ aircraft, including, but not
limited to, as a result of action taken by the Panamanian Department of Civil Aviation (the
Autoridad de Aeronáutica Civil) (the “AAC”) or other applicable bodies in the other jurisdictions
in which Copa Airlines or AeroRepública S.A. (“AeroRepública”) operates, except as would not have a
material adverse effect on the Company and its subsidiaries, taken as a whole.
(s) The Company and its subsidiaries have good and marketable title to all real property and
good and marketable title to all personal property owned by them that is material to the business
of the Company and its subsidiaries, taken as a whole, in each case free and clear of all liens,
encumbrances and defects except such as are described in the Time of Sale Prospectus or such as do
not materially affect the value of such property or do not materially interfere with the use made
and proposed to be made of such property by the Company and its subsidiaries; and any real property
and buildings held under lease by the Company and its subsidiaries are held by them under valid,
subsisting and enforceable leases except as are not material or do not materially interfere with
the use made and proposed to be made of such property and buildings by the Company and its
subsidiaries, in each case except as described in the Time of Sale Prospectus.
(t) The Company and its subsidiaries own or have the valid right to use, or can acquire on
reasonable terms, all material patents, patent rights, licenses, inventions, copyrights, know-how
(including trade secrets and other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures), trademarks, service marks and trade names currently employed
by them in connection with the business now operated by them, except where the failure to so own or
have the right to use would not have a material adverse effect on the Company and its subsidiaries,
taken as a whole, and neither the Company nor any of its subsidiaries has received any notice of
infringement of or conflict with asserted rights of others with respect to any of the foregoing
which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding,
would have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(u) No material labor dispute with the employees of the Company or any of its subsidiaries
exists, except as described in the Time of Sale Prospectus, or, to the knowledge of the Company, is
imminent; and the Company is not aware of any existing, threatened or imminent labor disturbance by
the employees of any of its principal suppliers, manufacturers or contractors that could have a
material adverse effect on the Company and its subsidiaries, taken as a whole.
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(v) The Company and each of its subsidiaries and its owned and leased properties, including
its airplanes, are insured by insurers of recognized financial responsibility against such losses
and risks and in such amounts as are prudent and customary in the businesses in which they are
engaged; neither the Company nor any of its subsidiaries has been refused any insurance coverage
sought or applied for; and neither the Company nor any of its subsidiaries has any reason to
believe that it will not be able to renew its existing insurance coverage as and when such coverage
expires or to obtain similar coverage from similar insurers as may be necessary to continue its
business at a cost that would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole, except as described in the Time of Sale Prospectus.
(w) The Company and its subsidiaries possess all certificates, authorizations and permits
issued by the appropriate federal, state or foreign regulatory authorities necessary to conduct
their respective businesses except where the failure to so possess would not have a material
adverse effect on the Company and its subsidiaries, taken as a whole, and neither the Company nor
any of its subsidiaries has received any notice of proceedings relating to the revocation or
modification of any such certificate, authorization or permit which, singly or in the aggregate, if
the subject of an unfavorable decision, ruling or finding, would have a material adverse effect on
the Company and its subsidiaries, taken as a whole, except as described in the Time of Sale
Prospectus.
(x) Except as described in the Time of Sale Prospectus, the Company and each of its
subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with management’s general or specific
authorizations; (ii) transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to maintain asset
accountability; (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 the
existing assets at reasonable intervals and appropriate action is taken with respect to any
differences. Except as described in the Time of Sale Prospectus, since the end of the Company’s
most recent audited fiscal year, there has been (i) no material weakness in the Company’s internal
control over financial reporting (whether or not remediated) and (ii) no change in the Company’s
internal control over financial reporting that has materially and adversely affected, or is
reasonably likely to materially and adversely affect, the Company’s internal control over financial
reporting.
(y) Except as described in the Time of Sale Prospectus, the Company has not sold, issued or
distributed any shares of Common Stock during the six-month period preceding the date hereof,
including any sales pursuant to Rule 144A under, or Regulation D or S of, the Securities Act, other
than shares issued pursuant to employee benefit plans, qualified stock option plans or other
employee compensation plans or pursuant to outstanding options, rights or warrants.
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(z) There are no contracts, agreements or understandings between either the Company or any of
its subsidiaries and any person that would give rise to a valid claim against either the Company or
any of its subsidiaries or any Underwriter for a brokerage commission, finder’s fee or other like
payment in connection with this offering.
(aa) The Company’s auditor and the Audit Committee of its Boards of Directors have not been
advised of (i) any significant deficiencies in the design or operation of internal controls that
could adversely affect the Company’s ability to record, process, summarize, and report financial
data, (ii) any fraud, whether or not material, that involves management or other employees who have
a role in the Company’s internal controls and (iii) any material weaknesses in internal controls
identified by the Company’s auditors other than as described in the Time of Sale Prospectus; and
since the date of the most recent evaluation of the Company’s disclosure controls and procedures,
there have been no significant changes in internal controls or in other factors that could
significantly and adversely affect internal controls, including any corrective actions with regard
to significant deficiencies and material weaknesses, other than as described in the Time of Sale
Prospectus.
(bb) The Company is a “foreign private issuer,” as defined in Rule 3b-4 under the Exchange
Act.
(cc) As of the date hereof, the Company and each of its subsidiaries, as well as the directors
and officers of the Company, are each in compliance in all material respects with all effective
provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 in effect and applicable to the Company as of the date
hereof and the rules and regulations of the Commission and the New York Stock Exchange (the “NYSE”)
promulgated thereunder as of the date hereof.
(dd) Ernst & Young, who have certified certain financial statements of the Company and its
subsidiaries, are independent public accountants as required by the Exchange Act and the rules and
regulations of the Commission thereunder.
(ee) The Company maintains a system of internal control over financial reporting (as such term
is defined in Rule 13a-15(f) of the Exchange Act) that complies with the requirements of the
Exchange Act and has been designed by the Company’s principal executive officer and principal
financial officer, or under their supervision, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles. Except as disclosed in the
Prospectus, the Company’s internal control over financial reporting is effective and the Company is
not aware of any material weaknesses in its internal control over financial reporting.
(ff) The Company maintains disclosure controls and procedures (as such term is defined in Rule
13a-15(e) of the Exchange Act) that comply with the requirements of the Exchange Act; such
disclosure controls and procedures have been designed to provide reasonable assurance that material
information relating to the Company and its subsidiaries is made known to the Company’s principal
executive officer and principal financial officer by
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others within those entities; and such disclosure controls and procedures are effective,
except as described in the Prospectus.
(gg) Each of the Company and Copa Airlines has the power to submit, and pursuant to Section 16
of this Agreement has legally, validly, effectively and irrevocably submitted, to the jurisdiction
of the courts of the State of New York and of the United States sitting in the Borough of Manhattan
and has the power to designate, appoint and empower, and pursuant to Section 16 of this Agreement,
has legally, validly and effectively designated, appointed and empowered an agent for service of
process in any suit or proceeding arising out of or relating to this Agreement.
(hh) The Shares have been (i) admitted for listing and trading on the NYSE and (ii) registered
with the National Securities Commission of Panama (the Comisión Nacional de Valores).
(ii) The audited consolidated financial statements as of and for the period ending December
31, 2007, included in each of the Time of Sale Prospectus and the Prospectus, together with the
related notes and schedules, present fairly in all material respects the financial position of each
of the Company and its subsidiaries as at the dates indicated and the results of operations and
statement of changes in financial position of each of the Company and its subsidiaries for the
periods specified; such financial statements have been prepared in conformity with U.S. GAAP
applied on a consistent basis during the periods involved (except as otherwise disclosed therein);
the other financial and statistical data set forth in the Prospectus are accurately presented in
all material respects and prepared, where applicable, on a basis consistent with the financial
statements and books and records of each of the Company and its subsidiaries; and neither the
Company nor its subsidiaries has any material liabilities or obligations, direct or contingent
(including any off-balance sheet obligations), not disclosed in the Time of Sale Prospectus or the
Prospectus.
(jj) Neither the Company nor any of its subsidiaries has sustained, since the date of the last
audited financial statements, any material loss or interference with its business from fire,
explosion, flood or other calamity, regardless of whether covered by insurance.
(kk) Any statistical and market-related data included in each of the Time of Sale Prospectus
and Prospectus are based on or derived from sources that each of the Company and Copa Airlines
believes to be reasonably reliable and accurate, and the Company or Copa Airlines has obtained the
written consent to the use of such data from such sources to the extent required.
(ll) All tax returns required to be filed by each of the Company and its subsidiaries in all
applicable jurisdictions have been filed, and all taxes and other assessments of a similar nature
(whether imposed directly or through withholding) including any interest, additions to tax or
penalties applicable thereto due or claimed to be due from either the Company or any of its
subsidiaries have been paid, other than those being contested in good faith and for which adequate
reserves have been provided, except as otherwise described in the Time of Sale
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Prospectus or where the failures to so file or so pay would not reasonably be expected to have
a material adverse effect on the Company and its subsidiaries, taken as a whole.
(mm) Except as described in the Time of Sale Prospectus, there is no tax, duty, levy, impost,
deduction, charge or withholding imposed by Panama or any political subdivision thereof or taxing
authority therein either (i) on or by virtue of the execution, delivery, performance or enforcement
of this Agreement or of any other document to be furnished hereunder or thereunder by the Company
or Copa Airlines, or (ii) on any payment to be made pursuant to this Agreement.
(nn) Neither the Company nor any of its subsidiaries has sent or received any communication
regarding termination of, or intent not to renew, any of the contracts or agreements referred to or
described in the Time of Sale Prospectus, except where such termination or non-renewal would not
have a material adverse effect on the Company and its subsidiaries, taken as a whole, and no such
termination or non-renewal has been threatened by either the Company or any of its subsidiaries,
or, to the best of each of the Company’s and Copa Airlines’ knowledge, by any other party to any
such contract or agreement.
(oo) This Agreement is in proper legal form under the laws of Panama for the enforcement
thereof in Panama against the Company and Copa Airlines, and it is not necessary in order to ensure
the legality, validity, enforcement or admissibility into evidence of this Agreement in Panama that
this Agreement be filed or recorded with any court or other authority in Panama or that any tax or
fee be paid in Panama on or in respect of this Agreement or any other document, other than court
costs, including (without limitation) filing fees and deposits to secure judgments, except that,
with respect to enforcement or admissibility into evidence (i) the signatures of the parties
thereto signing outside Panama shall have been notarized by a notary public licensed as such under
the law of the place of signing and the signature of such notary public shall have been legalized
by the relevant Panamanian Consulate or by an apostille, and (ii) this Agreement shall have been
translated into Spanish by a licensed translator in Panama.
2. Representations and Warranties of the Selling Shareholder. The Selling Shareholder
represents and warrants to and agrees with each of the Underwriters that:
(a) Except for the free writing prospectuses, if any, identified in Schedule II hereto, and
electronic road shows, if any, furnished to you before first use, the Selling Shareholder has not
prepared, used or referred to, and will not, without your prior consent, prepare, use or refer to,
any free writing prospectus.
(b) This Agreement has been duly authorized, executed and delivered by or on behalf of the
Selling Shareholder.
(c) The execution and delivery by the Selling Shareholder of, and the performance by the
Selling Shareholder of its obligations under, this Agreement will not contravene (i) any provision
of applicable law, (ii) the certificate of incorporation or by-laws of the Selling
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Shareholder, or (iii) any agreement or other instrument binding upon the Selling Shareholder
or any judgment, order or decree of any governmental body, agency or court having jurisdiction over
the Selling Shareholder, except for such contraventions in the case of (i) and (iii) as would not
have a material adverse effect on the Company or its subsidiaries, taken as a whole, or on the
Selling Shareholder’s ability to consummate the transactions contemplated hereby. No consent,
approval, authorization or order of, or qualification with, any governmental body or agency is
required for the performance by the Selling Shareholder of its obligations under this Agreement,
except (i) such as may be required by the securities or Blue Sky laws of the various states in
connection with the offer and sale of the Shares and (ii) as would not have a material adverse
effect on the Company or its subsidiaries, taken as a whole, or on the Selling Shareholder’s
ability to consummate the transactions contemplated hereby.
(d) The Selling Shareholder owns, and on the Closing Date will own, the Shares to be sold by
the Selling Shareholder free and clear of all security interests, claims, liens, equities or other
encumbrances and has, and on the Closing Date will have, the legal right and power, and all
authorizations and approvals required by law, to enter into this Agreement and to sell, transfer
and deliver the Shares to be sold by the Selling Shareholder.
(e) Upon payment for the Shares to be sold by the Selling Shareholder pursuant to this
Agreement, delivery of such Shares, as directed by the Underwriters, to Cede & Co. (“Cede”) or such
other nominee as may be designated by the Depository Trust Company (“DTC”), registration of such
Shares in the name of Cede or such other nominee and the crediting of such Shares on the books of
DTC to securities accounts of the Underwriters (assuming that neither DTC nor any such Underwriter
has notice of any adverse claim (within the meaning of Section 8-105 of the New York Uniform
Commercial Code (the “UCC”)) to such Shares), (A) DTC shall be a “protected purchaser” of such
Shares within the meaning of Section 8-303 of the UCC, (B) under Section 8-501 of the UCC, the
Underwriters will acquire a valid security entitlement in respect of such Shares and (C) no action
based on any “adverse claim”, within the meaning of Section 8-102 of the UCC, to such Shares may be
asserted against the Underwriters with respect to such security entitlement; for purposes of this
representation, the Selling Shareholder may assume that when such payment, delivery and crediting
occur, (x) such Shares will have been registered in the name of Cede or another nominee designated
by DTC, in each case on the Company’s share registry in accordance with its certificate of
incorporation, bylaws and applicable law, (y) DTC will be registered as a “clearing corporation”
within the meaning of Section 8-102 of the UCC and (z) appropriate entries to the accounts of the
several Underwriters on the records of DTC will have been made pursuant to the UCC.
(f) Upon payment for the Shares to be sold to the Underwriters by the Selling Shareholder
pursuant to this Agreement, all right, title and interest in the Shares will be transferred to the
Underwriters free and clear of all security interests, claims, liens, equities or other
encumbrances.
11
(g) The Selling Shareholder has no knowledge that the representations and warranties of the
Company and Copa Airlines contained in Section 1 are not true and correct, is familiar with the
Registration Statement and Prospectus and has no knowledge of any untrue statement of material fact
or omission to state a material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The Selling Shareholder is not prompted
by any information concerning the Company or its subsidiaries that is not set forth in the Time of
Sale Prospectus to sell its Shares pursuant to this Agreement. The liability of the Selling
Shareholder for a breach of the representations and warranties contained in this paragraph shall be
limited to an amount equal to the aggregate Public Offering Price of the Shares sold by the Selling
Shareholder under this Agreement.
(h) (i) The Registration Statement, when it became effective, did not contain and, as amended
or supplemented, if applicable, will not 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, (ii) the Time of Sale Prospectus does not, and at the time of each sale of the Shares
in connection with the offering and at the Closing Date (as defined in Section 5), the Time of Sale
Prospectus, as then amended or supplemented by the Company, if applicable, will not, contain any
untrue statement of a material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were made, not misleading,
(iii) each broadly available road show, if any, when considered together with the Time of Sale
Prospectus, does not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances under which they
were made, not misleading and (iv) the Prospectus does not contain and, as amended or supplemented,
if applicable, will not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances under which they
were made, not misleading, except that the representations and warranties set forth in this
paragraph 2(h) apply only to statements or omissions in the Registration Statement, the Time of
Sale Prospectus, any broadly available road show or the Prospectus based upon information relating
to the Selling Shareholder that is furnished to the Company in writing by the Selling Shareholder
expressly for use therein. The liability of the Selling Shareholder for a breach of representations
and warranties contained in this paragraph shall be limited to an amount equal to the aggregate
Public Offering Price of the Shares sold by the Selling Shareholder under this Agreement.
(i) In order to document the Underwriters’ compliance with the reporting and withholding
provisions of the Tax Equity and Fiscal Responsibility Act of 1982 with respect to the transactions
herein contemplated, the Selling Shareholder will deliver to the Representative prior to or at the
Closing Date a properly completed and executed U.S. Treasury Department Form W-9 (or other
applicable form or statement specified by the U.S. Treasury Department regulations in lieu
thereof).
(j) Except as disclosed by the Selling Shareholder in writing to the Representative, neither
the Selling Shareholder nor any of his, her or its affiliates directly, or indirectly through
12
one or more intermediaries, controls, or is controlled by, or is under common control with, or
has any other association with (within the meaning of Article 1(q) of the By-laws of the Financial
Industry Regulatory Authority, Inc. (the “FINRA”)), any member firm of the FINRA.
3. Agreements to Sell and Purchase. The Selling Shareholder hereby agrees to sell to the
several Underwriters, and each Underwriter, upon the basis of the representations and warranties
herein contained, but subject to the conditions hereinafter stated, agrees, severally and not
jointly, to purchase from the Selling Shareholder at $ a share (the “Purchase
Price”) the number of Firm Shares set forth in Schedule I hereto opposite the name of such
Underwriter.
On the basis of the representations and warranties contained in this Agreement, and subject to
its terms and conditions, the Selling Shareholder agrees to sell to the Underwriters the Additional
Shares, and the Underwriters shall have the right to purchase, severally and not jointly, up to
Additional Shares at the Purchase Price. You may exercise this right on behalf of the
Underwriters in whole or from time to time in part by giving written notice not later than 30 days
after the date of this Agreement. Any exercise notice shall specify the number of Additional
Shares to be purchased by the Underwriters and the date on which such shares are to be purchased.
Each purchase date must be at least two business days after the written notice is given and may not
be earlier than the closing date for the Firm Shares nor later than ten business days after the
date of such notice. Additional Shares may be purchased as provided in Section 4 hereof solely for
the purpose of covering over-allotments made in connection with the offering of the Firm Shares.
On each day, if any, that Additional Shares are to be purchased (an “Option Closing Date”), each
Underwriter agrees, severally and not jointly, to purchase the number of Additional Shares (subject
to such adjustments to eliminate fractional shares as you may determine) that bears the same
proportion to the total number of Additional Shares to be purchased on such Option Closing Date as
the number of Firm Shares set forth in Schedule I hereto opposite the name of such Underwriter
bears to the total number of Firm Shares.
The Company hereby agrees that, without the prior written consent of the Representative on
behalf of the Underwriters, it will not, during the period ending 90 days after the date of the
Prospectus, (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or
otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any
securities convertible into or exercisable or exchangeable for Common Stock or (2) enter into any
swap or other arrangement that transfers to another, in whole or in part, any of the economic
consequences of ownership of the Common Stock, whether any such transaction described in clause (1)
or (2) above is to be settled by delivery of Common Stock or such other securities, in cash or
otherwise or (3) file any registration statement with the Commission relating to the offering of
any shares of Common Stock or any securities convertible into or exercisable or exchangeable for
Common Stock other than in respect of any Shares owned by the Selling Shareholder.
13
The restrictions contained in the preceding paragraph shall not apply to any of the Company’s
existing employee benefits plan.
4. Terms of Public Offering. The Selling Shareholder is advised by you that the Underwriters
propose to make a public offering of their respective portions of the Shares as soon after the
Registration Statement and this Agreement have become effective as in your judgment is advisable.
The Selling Shareholder is further advised by you that the Shares are to be offered to the public
initially at $ a share (the “Public Offering Price”) and to certain dealers selected by you at a
price that represents a concession not in excess of $ a share under the Public Offering Price.
5. Payment and Delivery. Payment for the Firm Shares to be sold by the Selling Shareholder
shall be made to the Selling Shareholder in Federal or other funds immediately available in New
York City against delivery of such Firm Shares for the respective accounts of the several
Underwriters at 10:00 a.m., New York City time, on May , 2008 or at such other time on the same or
such other date, not later than May , 2008 as shall be designated in writing by you. The time and
date of such payment are hereinafter referred to as the “Closing Date.”
Payment for any Additional Shares shall be made to the Selling Shareholder in Federal or other
funds immediately available in New York City against delivery of such Additional Shares for the
respective accounts of the several Underwriters at 10:00 a.m., New York City time, on the date
specified in the corresponding notice described in Section 3 or at such other time on the same or
on such other date, in any event not later than , as shall be designated in writing by you.
The Firm Shares and Additional Shares shall be registered in the name of Cede. The Firm
Shares and Additional Shares shall be delivered to you on the Closing Date or an Option Closing
Date, as the case may be, for the respective accounts of the several Underwriters, with any
transfer taxes payable in connection with the transfer of the Shares to the Underwriters duly paid,
against payment of the Purchase Price therefor.
6. Conditions to the Underwriters’ Obligations. The obligations of the Selling Shareholder to
sell the Shares to the Underwriters and the several obligations of the Underwriters to purchase and
pay for the Shares on the Closing Date are subject to the condition that the Registration Statement
shall have become effective not later than 5:00 p.m. (New York City time) on the date hereof.
The several obligations of the Underwriters are subject to the following further conditions:
(a) Subsequent to the execution and delivery of this Agreement and prior to the Closing Date:
14
(i) there shall not have occurred any downgrading, nor shall any notice have been given
of any intended or potential downgrading or of any review for a possible change that does
not indicate the direction of the possible change, in the rating accorded any of the
securities of the Company or any of its subsidiaries by any “nationally recognized
statistical rating organization,” as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act; and
(ii) there shall not have occurred any change, or any development involving a
prospective change, in the condition, financial or otherwise, or in the earnings, business
or operations of the Company and its subsidiaries, taken as a whole, from that set forth in
the Time of Sale Prospectus that, in your judgment, is material and adverse and that makes
it, in your judgment, impracticable to market the Shares on the terms and in the manner
contemplated in the Time of Sale Prospectus.
(b) The Underwriters shall have received on the Closing Date a certificate, dated the Closing
Date and signed by an executive officer of the Company and Copa Airlines, to the effect set forth
in Section 6(a) above and to the effect that the representations and warranties of each of the
Company and Copa Airlines contained in this Agreement are true and correct as of the Closing Date
and that each of the Company and Copa Airlines has complied in all material respects with all of
the agreements and satisfied all of the conditions on its part to be performed or satisfied
hereunder on or before the Closing Date.
The officer signing and delivering such certificate may rely upon the best of his or her
knowledge as to proceedings threatened.
(c) The Underwriters shall have received on the Closing Date an opinion of ▇▇▇▇▇▇▇, ▇▇▇▇▇ &
▇▇▇▇▇, special outside counsel for each of the Company and Copa Airlines, dated the Closing Date,
to the effect that:
(i) the Company and each of its Panamanian subsidiaries has been duly incorporated, is
validly existing as a corporation in good standing under the laws of Panama, has all
requisite power and authority to own its property and to conduct its business as described
in the Time of Sale Prospectus and is duly qualified to transact business and is in good
standing in each jurisdiction in Panama in which the conduct of its business or its
ownership or leasing of property requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not have a material adverse effect
on the Company and its subsidiaries, taken as a whole;
(ii) the authorized capital stock of the Company conforms as to legal matters to the
description thereof contained in each of the Time of Sale Prospectus and the Prospectus;
15
(iii) the issued shares of Common Stock (including the Shares to be sold by the Selling
Shareholder) have been duly and validly authorized and issued and are fully paid and
non-assessable;
(iv) all of the issued shares of capital stock of each Panamanian subsidiary of the
Company have been duly and validly authorized and issued, are fully paid and non-assessable
and are owned directly by the Company (with the exception of the minority interests therein,
as described in the Prospectus), free and clear of all liens, encumbrances, equities or
claims;
(v) this Agreement has been duly authorized, executed and delivered by each of the
Company and Copa Airlines;
(vi) assuming this Agreement has been duly authorized, executed and delivered by each
of the other parties thereto, this Agreement is a valid and binding obligation of each of
the Company and Copa Airlines, enforceable against the Company and Copa Airlines in
accordance with its terms;
(vii) the execution and delivery by each of the Company and Copa Airlines of, and the
performance by each of the Company and Copa Airlines of its respective obligations under,
this Agreement will not contravene any provision of applicable law or the Pacto Social
(Articles of Incorporation) of the Company or Copa Airlines or, to the best of such
counsel’s knowledge, any agreement or other instrument binding upon any of the Company or
any subsidiaries that is material to any of the Company and its subsidiaries, taken as a
whole, or, to the best of such counsel’s knowledge, any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the Company or any subsidiary;
(viii) no consent, approval, authorization or order of, or qualification with, any
governmental body or agency in Panama is required for the performance by any of the Company
or Copa Airlines of its respective obligations under this Agreement, except such as may be
required by the securities or Blue Sky laws of the various states in connection with the
offer and sale of the Shares;
(ix) the statements relating to Panamanian legal matters, documents or proceedings
included in (A) the Time of Sale Prospectus and the Prospectus under the captions “Risk
Factors,” “Description of Capital Stock,” “Income Tax Consequences—Panamanian Taxation” and
“Underwriters” and in the annual report on Form 20-F for the year ended December 31, 2007
under the captions “Item 3. Key Information—D. Risk Factors,” “Item 4. Information on the
Company—B. Business Overview—Regulation—Panama,” “Item 10. Additional Information—E.
Taxation—Panamanian Taxation” and “Item 10B. Memorandum and Articles of
Association—Description of Capital Stock” and (B) the Registration Statement in Items 6 and
7, in each case fairly summarize in all material respects such matters, documents or
proceedings;
16
(x) to the best of such counsel’s knowledge and after due inquiry in Panama, there are
no actions, suits or proceedings by or before any arbitrator or governmental body pending or
threatened against or affecting the Company or any of its subsidiaries which, if adversely
determined, could reasonably be expected to, individually or in the aggregate, have a
material adverse effect on the Company and its subsidiaries, taken as a whole, except as
described in the Time of Sale Prospectus;
(xi) Copa Airlines possesses the governmental licenses in Panama necessary to conduct
its commercial airline operations as described under the caption “Item 4. Information on the
Company—B. Business Overview—Regulation,” in the annual report on Form 20-F for the year
ended December 31, 2007, and Copa Airlines is in compliance with the terms and conditions of
all such governmental licenses, except where the failure to so comply would not, singly or
in the aggregate, have a material adverse effect on either the Company or Copa Airlines; and
all of the governmental licenses are valid and in full force and effect, except where the
invalidity of such governmental licenses or the failure of such governmental licenses to be
in full force and effect would not, singly or in the aggregate, have a material adverse
effect on either the Company or Copa Airlines, in all cases except as disclosed in the Time
of Sale Prospectus; and
(xii) nothing has come to the attention of such counsel that causes such counsel to
believe that (A) the Registration Statement or the Prospectus included therein (except for
the financial statements and financial schedules and other financial data included therein,
as to which such counsel need not express any belief) at the time the Registration Statement
became effective contained any 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, (B) the Time of Sale Prospectus (except for the financial statements and
financial schedules and other financial data included therein, as to which such counsel need
not express any belief) as of the date of this Agreement or as amended or supplemented, if
applicable, as of the Closing Date contained or contains any 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 under which they were made, not misleading or (C) the
Prospectus (except for the financial statements and financial schedules and other financial
data included therein, as to which such counsel need not express any belief) as of its date
or as amended or supplemented, if applicable, as of the Closing Date contained or contains
any 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.
(d) The Underwriters shall have received on the Closing Date an opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, outside United States counsel for the Company and Copa Airlines, dated the
Closing Date, to the effect that:
17
(i) this Agreement has been duly executed and delivered by each of the Company and Copa
Airlines under the law of the State of New York;
(ii) the execution and delivery by each of the Company and Copa Airlines and the
performance by each of the Company and Copa Airlines of its obligations under this Agreement
will not violate any U.S. federal or New York statute or any rule or regulation that has
been issued pursuant to any U.S. federal or New York statute and will not breach the terms
of any agreement identified on a schedule to such opinion;
(iii) no consent, approval, registration or qualification of or with any U.S. federal
or New York governmental agency is required for the performance by either the Company or
Copa Airlines of its obligations under this Agreement, except for the registration under the
Securities Act and the Exchange Act of the Shares, and such consents, approvals,
registrations or qualifications as may be required under state securities or Blue Sky laws
in connection with the purchase and distribution of the Shares by the Underwriters;
(iv) the statements made in the Time of Sale Prospectus and the Prospectus under the
caption “Income Tax Consequences—United States,” and the statements made under the caption
“Item 10. Additional Information—E. Taxation—United States” in the annual report on Form
20-F for the year ended December 31, 2007, insofar as they purport to constitute summaries
of matters of U.S. federal tax law and regulations or legal conclusions with respect
thereto, constitute accurate summaries of the matters described therein in all material
respects;
(v) neither the Company nor Copa Airlines is an investment company within the meaning
of or subject to regulations under the Investment Company Act of 1940, as amended;
(vi) assuming such submission to jurisdiction is valid under the laws of Panama, under
the laws of the State of New York relating to submission to personal jurisdiction, each of
the Company and Copa Airlines has, pursuant to Section 16 of this Agreement, submitted to
the personal jurisdiction of the courts of the State of New York and of the United States
sitting in the Borough of Manhattan in any action arising out of or relating to this
Agreement, has to the fullest extent permitted by law waived any objection to the venue of
such an action in any such court, and has appointed CT Corporation as its authorized agent
for the purpose described in Section 16 hereof, and service of process effected on such
agent in the manner set forth in Section 16 hereof will be effective to confer valid
personal jurisdiction over the Company in any such action; and
(vii) such counsel advises that (1) each document filed pursuant to the Exchange Act
and incorporated by reference in the Time of Sale Prospectus or the
18
Prospectus (except for the financial statements and financial schedules and other
financial data contained therein or omitted therefrom and management’s report on the
effectiveness of internal control over financial reporting, as to which such counsel need
not express any opinion) as of the respective dates of their filing with the Commission
appeared on their face to be appropriately responsive in all material respects to the
requirements of the Exchange Act and the applicable rules and regulations of the Commission
thereunder and (2) (A) such counsel advises that the Registration Statement, as of its
effective date, and the Prospectus, as of its date (except for the financial statements and
financial schedules and other financial data contained therein or omitted therefrom and
management’s report on the effectiveness of internal control over financial reporting, as to
which such counsel need not express any opinion) appear on their face to be appropriately
responsive in all material respects to the requirements of the Securities Act and the
applicable rules and regulations of the Commission thereunder, and (B) nothing has come to
the attention of such counsel that causes such counsel to believe that (i) the Registration
Statement (except for the financial statements and financial schedules and other financial
data contained therein or omitted therefrom and management’s report on the effectiveness of
internal control over financial reporting, as to which such counsel need not express any
belief) at the time the Registration Statement became effective contained any 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, (ii) the Time of Sale
Prospectus considered together with the number of shares and price to public on the cover
page of the Prospectus (except for the financial statements and financial schedules and
other financial data contained therein or omitted therefrom and management’s report on the
effectiveness of internal control over financial reporting, as to which such counsel need
not express any belief) as of the time of the pricing of the Shares on the date of this
Agreement contained any 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 or (iii) the Prospectus (except for
the financial statements and financial schedules and other financial data contained therein
or omitted therefrom and management’s report on the effectiveness of internal control over
financial reporting, as to which such counsel need not express any belief) as of its date or
as amended or supplemented, if applicable, of the Closing Date contained or contains any
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.
(e) The Underwriters shall have received on the Closing Date an opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇
LLP, counsel for the Selling Shareholder, dated the Closing Date, to the effect that:
(i) assuming this Agreement has been duly authorized, executed and delivered by each of
the parties thereto, this Agreement is a valid and binding obligation of the Selling
Shareholder, enforceable against the Selling Shareholder in accordance with its terms
subject to (i) the effects of bankruptcy, insolvency, fraudulent conveyance,
19
reorganization, moratorium and other similar laws relating to or affecting creditors’
rights generally, (ii) general equitable principles (whether considered in a proceeding in
equity or at law) and (iii) an implied covenant of good faith and fair dealing;
(ii) the execution and delivery by the Selling Shareholder of, and the performance by
the Selling Shareholder of its obligations under, this Agreement will not violate any U.S.
federal or New York statute or any rule or regulation that has been issued pursuant to any
U.S. federal or New York statute except for any violation that would not have a material
adverse effect on the Selling Shareholder’s performance of its obligations under this
Agreement;
(iii) no consent, approval, registration or qualification of or with any U.S. federal
or New York governmental agency is required for the performance by the Selling Shareholder
with its obligations under this Agreement, except for the registration under the Securities
Act and the Exchange Act of the Shares, and such consents, approvals, authorizations,
registrations or qualifications as may be required under state securities or Blue Sky laws
in connection with the purchase and distribution of the Shares by the Underwriters except
for any violation that would not have a material adverse effect on the Selling Shareholder’s
performance of its obligations under this Agreement; and
(iv) assuming the Selling Shareholder has full power, right and authority to sell the
Shares to be sold by the Selling Shareholder upon the payment and transfer contemplated by
the Underwriting Agreement, the Underwriters will acquire a security entitlement with
respect to the Shares sold by the Selling Shareholder and no action based on an adverse
claim may be asserted against the Underwriters.
(f) The Underwriters shall have received on the Closing Date an opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇,
in-house counsel for the Company and Copa Airlines, dated the Closing Date, to the effect that:
(i) the Company and each of its subsidiaries has been duly incorporated, is validly
existing as a corporation in good standing under the laws of Panama, has all requisite power
and authority to own its property and to conduct its business as described in the Time of
Sale Prospectus and is duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to be so qualified or be
in good standing would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole;
(ii) there are no actions, suits or proceedings by or before any arbitrator or
governmental body pending or threatened against or affecting the Company or any of its
subsidiaries which, if adversely determined, could reasonably be expected to, individually
or in the aggregate, have a material adverse effect on the Company and its subsidiaries,
taken as a whole, except as described in the Time of Sale Prospectus; and
20
(iii) Copa Airlines possesses the governmental licenses necessary to conduct its
commercial airline operations as described under the caption “Item 4. Information on the
Company—B. Business Overview—Regulation” in the annual report on Form 20-F for the year
ended December 31, 2007, and Copa Airlines is in compliance with the terms and conditions of
all such governmental licenses, except where the failure to so comply would not, singly or
in the aggregate, have a material adverse effect on either the Company or Copa Airlines; and
all of the governmental licenses are valid and in full force and effect, except where the
invalidity of such governmental licenses or the failure of such governmental licenses to be
in full force and effect would not, singly or in the aggregate, have a material adverse
effect on either the Company or Copa Airlines, in all cases except as disclosed in the Time
of Sale Prospectus.
(g) The Underwriters shall have received on the Closing Date an opinion of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Senior Vice-President and General Counsel for the Selling Shareholder, dated the Closing Date, to
the effect that:
(i) this Agreement has been duly authorized by the Selling Shareholder and has been
duly executed and delivered by the Selling Shareholder
(ii) the execution and delivery by the Selling Shareholder of, and the performance by
the Selling Shareholder of its obligations under, this Agreement will not contravene any
provision of the organizational documents of the Selling Shareholder or any agreement or
other instrument binding upon the Selling Shareholder or any judgment, order or decree of
any governmental body, agency or court having jurisdiction over the Selling Shareholder
except for any violation that would not be reasonably expected to have a material adverse
effect on the Selling Shareholder’s performance of its obligations under this Agreement;
(iii) no consent, approval, authorization or order of, or qualification with, any
governmental body or agency is required for the performance by the Selling Shareholder of
its obligations under this Agreement, except such as may be required by the securities or
Blue Sky laws of the States of the United States or securities laws of other jurisdictions
in connection with the offer and sale of the Shares (as to which such counsel expresses no
comment or opinion) or have been obtained or effected under the Securities Act or Exchange
Act or in connection with the listing of the Shares on the NYSE or the failure of which to
be obtained would not reasonably be expected to have a material adverse effect on the
Selling Shareholder’s performance of its obligations under this Agreement; and
(iv) the Selling Shareholder owns, and on the Closing Date will own, the Shares to be
sold by it free and clear of all liens and similar encumbrances and has, and on the Closing
Date will have, the legal right and corporate power, and all authorizations
21
and approvals required by law, to enter into this Agreement and to sell, transfer and
deliver the Shares to be sold by it.
(h) The Underwriters shall have received on the Closing Date an opinion of ▇▇▇▇▇, ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇, Panamanian counsel for the Underwriters, dated the Closing Date, covering the matters
referred to in Sections 6(c)(iii), 6(c)(v), 6(c)(ix) (but only as to the statements in each of the
Time of Sale Prospectus and the Prospectus under “Description of Capital Stock” and “Underwriters”)
and 6(c)(xii) above.
(i) The Underwriters shall have received on the Closing Date an opinion of ▇▇▇▇▇ ▇▇▇▇ &
▇▇▇▇▇▇▇▇, counsel for the Underwriters, dated the Closing Date, covering the matters referred to in
Sections 6(c)(ix) (but only as to the statements in the Prospectus under “Underwriters”) and letter
covering the matters referred to in 6(d)(vii) above.
(j) With respect to Section 6(c)(xii) above, ▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇ and ▇▇▇▇▇, ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇, with respect to Section 6(d)(vii) above, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, ▇▇▇▇▇▇ &
▇▇▇▇▇▇ LLP and ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇ may state that their opinions and beliefs are based upon their
participation in the preparation of the Registration Statement, Time of Sale Prospectus and
Prospectus and any amendments or supplements thereto and review and discussion of the contents
thereof, but are without independent check or verification, except as specified. With respect to
Section 6(d) above, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP may rely upon with respect to factual
matters and to the extent such counsel deems appropriate, upon the representations of the parties
hereto contained herein and in other documents and instruments. With respect to Section 6(e) above,
▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP may rely upon opinion or opinions of in-house counsel for the Selling
Shareholder and, with respect to factual matters and to the extent such counsel deems appropriate,
upon the representations of the parties hereto contained herein and in other documents and
instruments.
(k) The opinions of ▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
described in Sections 6(c), 6(d) and 6(e) above shall be rendered to the Underwriters at the
request of the Company or the Selling Shareholder and shall so state therein.
(l) The Underwriters shall have received, on each of the date hereof and the Closing Date, a
letter dated the date hereof or the Closing Date, as the case may be, in form and substance
satisfactory to the Underwriters, from Ernst & Young independent public accountants, containing
statements and information of the type ordinarily included in accountants’ “comfort letters” to
underwriters with respect to the financial statements and certain financial information contained
in the Registration Statement, the Time of Sale Prospectus and the Prospectus; provided that the
letter delivered on the Closing Date shall use a “cut-off date” not earlier than the date hereof.
(m) The “lock-up” agreements, each substantially in the form of Exhibit A hereto, between you
and CIASA, officers and directors of the Company relating to sales and certain
22
other dispositions of shares of Common Stock or certain other securities, delivered to you on
or before the date hereof, shall be in full force and effect on the Closing Date.
(n) The listing of the Shares on the NYSE shall be in full force and effect.
The several obligations of the Underwriters to purchase Additional Shares hereunder are
subject to the delivery to you on the applicable Option Closing Date of such documents as you may
reasonably request with respect to the good standing of the Company, the due authorization and
issuance of the Additional Shares to be sold on such Option Closing Date and other matters related
to the issuance of such Additional Shares.
7. Covenants of the Company. The Company covenants with each Underwriter as follows:
(a) To furnish to you, without charge, six signed copies of the Registration Statement
(including exhibits thereto) and for delivery to each other Underwriter a conformed copy of the
Registration Statement (without exhibits thereto) and to furnish to you in New York City, without
charge, prior to 4:00 p.m. New York City time on the business day next succeeding the date of this
Agreement and during the period mentioned in Section 7(e) and 7(f) below, as many copies of the
Time of Sale Prospectus, the Prospectus, any documents incorporated therein by reference and any
supplements and amendments thereto or to the Registration Statement as you may reasonably request.
(b) Before amending or supplementing the Registration Statement, the Time of Sale Prospectus
or the Prospectus, to furnish to you a copy of each such proposed amendment or supplement and to
make such modifications as you may reasonably suggest, and file with the Commission within the
applicable period specified in Rule 424(b) under the Securities Act any prospectus required to be
filed pursuant to such Rule.
(c) To furnish to you a copy of each proposed free writing prospectus to be prepared by or on
behalf of, used by, or referred to by the Company and not to use or refer to any proposed free
writing prospectus to which you reasonably object.
(d) Not to take any action that would result in an Underwriter or the Company being required
to file with the Commission pursuant to Rule 433(d) under the Securities Act a free writing
prospectus prepared by or on behalf of the Underwriter that the Underwriter otherwise would not
have been required to file thereunder without the consent of such Underwriter and the
Representative.
(e) If the Time of Sale Prospectus is being used to solicit offers to buy the Shares at a time
when the Prospectus is not yet available to prospective purchasers and any event shall occur or
condition exist as a result of which it is necessary to amend or supplement the Time of Sale
Prospectus in order to make the statements therein, in the light of the circumstances, not
misleading, or if any event shall occur or condition exist as a result of which the Time of Sale
23
Prospectus conflicts with the information contained in the Registration Statement then on
file, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement
the Time of Sale Prospectus to comply with applicable law, forthwith to prepare, file with the
Commission and furnish, at its own expense, to the Underwriters and to any dealer upon request,
either amendments or supplements to the Time of Sale Prospectus so that the statements in the Time
of Sale Prospectus as so amended or supplemented will not, in the light of the circumstances when
delivered to a prospective purchaser, be misleading or so that the Time of Sale Prospectus, as
amended or supplemented, will no longer conflict with the Registration Statement, or so that the
Time of Sale Prospectus, as amended or supplemented, will comply with applicable law.
(f) If, during such period after the first date of the public offering of the Shares as in the
opinion of counsel for the Underwriters the Prospectus (or in lieu thereof the notice referred to
in Rule 173(a) under the Securities Act) is required by law to be delivered in connection with
sales by an Underwriter or dealer, any event shall occur or condition exist as a result of which it
is necessary to amend or supplement the Prospectus in order to make the statements therein, in the
light of the circumstances when the Prospectus (or in lieu thereof the notice referred to in Rule
173(a) under the Securities Act) is delivered to a purchaser, not misleading, or if, in the opinion
of counsel for the Underwriters, it is necessary to amend or supplement the Prospectus to comply
with applicable law, forthwith to prepare, file with the Commission and furnish, at its own
expense, to the Underwriters and to the dealers (whose names and addresses you will furnish to the
Company) to which Shares may have been sold by you on behalf of the Underwriters and to any other
dealers upon request, either amendments or supplements to the Prospectus so that the statements in
the Prospectus as so amended or supplemented will not, in the light of the circumstances when the
Prospectus (or in lieu thereof the notice referred to in Rule 173(a) under the Securities Act) is
delivered to a purchaser, be misleading or so that the Prospectus, as amended or supplemented, will
comply with law.
(g) To endeavor to qualify the Shares for offer and sale under the securities or Blue Sky laws
of such jurisdictions as you shall reasonably request, provided 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 or to subject
itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so
subject.
(h) To make generally available to the Company’s security holders and to you as soon as
practicable an earning statement covering the twelve month period ending December 31, 2009 that
satisfies the provisions of Section 11(a) of the Securities Act and the rules and regulations of
the Commission thereunder.
(i) To use its best efforts to maintain in full force and effect the listing of the Shares on
the NYSE, including the filing with the NYSE of all required documents and notices for non-U.S.
companies that have securities that are traded on the NYSE.
24
(j) To file any documents or reports with respect to the Shares required to be filed with the
National Securities Commission of Panama (the Comisión Nacional de Valores) in the time period
required for such filing.
(k) To make available to the holders of the Shares and the Representative, (A) after the end
of each fiscal year, an annual report (in English) that will include a review of operations and
annual audited consolidated financial statements (including consolidated balance sheets, statements
of income, statements of change in shareholders’ equity and statements of cash flow) with an
opinion by an independent accountant and prepared in conformity with U.S. GAAP; and (B) after the
end of each of the first three quarterly periods of each fiscal year, unaudited consolidated
financial information prepared in accordance with U.S. GAAP, equivalent in substance to the
information that would be required to be filed on Form 10-Q, if the Company were required to file
quarterly reports on Form 10-Q.
8. Expenses. Whether or not the transactions contemplated in this Agreement are consummated
or this Agreement is terminated, the Selling Shareholder agrees to pay or cause to be paid all
expenses incident to the performance of its obligations under this Agreement and the Company’s
performance of its obligations under this Agreement, including: (i) the fees, disbursements and
expenses of the Company’s counsel, the Company’s accountants and counsel for the Selling
Shareholder in connection with the registration and delivery of the Shares under the Securities Act
and all other fees or expenses in connection with the preparation and filing of the Registration
Statement, any preliminary prospectus, the Time of Sale Prospectus, the Prospectus, any free
writing prospectus prepared by or on behalf of, used by, or referred to by the Company and
amendments and supplements to any of the foregoing, including all printing costs associated
therewith, and the mailing and delivering of copies thereof to the Underwriters and dealers, in the
quantities hereinabove specified, (ii) all costs and expenses related to the transfer and delivery
of the Shares to the Underwriters, including any transfer or other taxes payable thereon, (iii) the
cost of printing or producing any Blue Sky or Legal Investment memorandum in connection with the
offer and sale of the Shares under state securities laws and all expenses in connection with the
qualification of the Shares for offer and sale under state securities laws as provided in Section
7(g) hereof, including filing fees and the reasonable fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection with the Blue Sky or Legal
Investment memorandum, (iv) all filing fees and the reasonable fees and disbursements of counsel to
the Underwriters incurred in connection with the review and qualification of the offering of the
Shares by the FINRA, (v) all costs and expenses incident to listing the Shares on the NYSE, (vi)
the costs and charges of any transfer agent, registrar or depositary, (vii) the costs and expenses
of the Company relating to investor presentations on any “road show” undertaken in connection with
the marketing of the offering of the Shares, including, without limitation, expenses associated
with the preparation or dissemination of any electronic road show, expenses associated with the
production of road show slides and graphics, fees and expenses of any consultants engaged in
connection with the road show presentations with the prior approval of the Company, lodging
expenses of the representatives and officers of the Company and any such consultants and the
Company’s pro rata share of travel expenses,
25
(viii) the document production charges and expenses associated with printing this Agreement
and (ix) all other costs and expenses incident to the performance of the obligations of the Company
hereunder for which provision is not otherwise made in this Section. It is understood, however,
that except as provided in Section 10 entitled “Indemnity and Contribution” and the last paragraph
of Section 12 below, the Underwriters will pay all of their costs and expenses, including fees and
disbursements of their counsel, stock transfer taxes payable on resale of any of the Shares by them
and any advertising expenses connected with any offers they may make.
The provisions of this Section shall not supersede or otherwise affect any agreement that the
Company and the Selling Shareholder may otherwise have for the allocation of such expenses among
themselves.
9. Covenant of the Underwriters. Each Underwriter severally covenants with the Company not to
take any action that would result in the Company being required to file with the Commission under
Rule 433(d) a free writing prospectus prepared by or on behalf of such Underwriter that otherwise
would not be required to be filed by the Company thereunder, but for the action of the Underwriter
and not to use or refer to any free writing prospectus without the prior written consent of the
Company.
10. Indemnity and Contribution. (a) The Company and Copa Airlines, jointly and severally,
agree to indemnify and hold harmless each Underwriter, each person, if any, who controls any
Underwriter within the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act, and each affiliate of any Underwriter within the meaning of Rule 405 under the
Securities Act from and against any and all losses, claims, damages and liabilities (including,
without limitation, any legal or other expenses reasonably incurred in connection with defending or
investigating any such action or claim) caused by any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement or any amendment thereof, any
preliminary prospectus, the Time of Sale Prospectus, any “issuer free writing prospectus” as
defined in Rule 433(d) of the Securities Act relating to the Shares or any “issuer information”
filed or required to be filed pursuant to Rule 433(d) of the Securities Act or the Prospectus or
any amendment or supplement thereto, or caused by any omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the statements therein not
misleading, except insofar as such losses, claims, damages or liabilities are caused by any such
untrue statement or omission or alleged untrue statement or omission based upon information
relating to any Underwriter furnished to the Company in writing by such Underwriter, expressly for
use therein.
(b) The Selling Shareholder agrees to indemnify and hold harmless each Underwriter and the
Company, each person, if any, who controls the Company, Copa Airlines or any Underwriter within the
meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act, and each
affiliate of any Underwriter within the meaning of Rule 405 under the Securities Act from and
against any and all losses, claims, damages and liabilities (including, without limitation, any
legal or other expenses reasonably incurred in connection with defending
26
or investigating any such action or claim) caused by any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or any amendment thereof, any
preliminary prospectus, the Time of Sale Prospectus, any “issuer free writing prospectus” as
defined in Rule 433(d) of the Securities Act relating to the Shares or any “issuer information”
filed or required to be filed pursuant to Rule 433(d) of the Securities Act or the Prospectus or
any amendment or supplement thereto, or caused by any omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the statements therein not
misleading, but only with reference to information relating to the Selling Shareholder furnished in
writing to the Company by or on behalf of the Selling Shareholder expressly for use in the
Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, any “issuer free
writing prospectus” as defined in Rule 433(d) of the Securities Act relating to the Shares or any
“issuer information” filed or required to be filed pursuant to Rule 433(d) of the Securities Act
or the Prospectus or any amendment or supplement thereto. The liability of the Selling Shareholder
under the indemnity agreement contained in this paragraph shall be limited to an amount equal to
the aggregate Public Offering Price of the Shares sold by the Selling Shareholder under this
Agreement.
(c) Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the
Company, the Selling Shareholder, the directors of the Company, the officers of the Company who
sign the Registration Statement and each person, if any, who controls the Company or the Selling
Shareholder within the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act to the same extent as the foregoing indemnity from the Company to such Underwriter,
but only with reference to information relating to such Underwriter furnished to the Company in
writing by such Underwriter expressly for use in the Registration Statement, any preliminary
prospectus, the Time of Sale Prospectus, any “issuer free writing prospectus” as defined in Rule
433(d) of the Securities Act relating to the Shares or any “issuer information” filed or required
to be filed pursuant to Rule 433(d) of the Securities Act, the Prospectus or any amendments or
supplements thereto.
(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 Section 10(a), 10(b),
or 10(c) such person (the “indemnified party”) shall promptly notify the person against whom such
indemnity may be sought (the “indemnifying party”) in writing, but the omission to so notify the
indemnifying party shall not relieve it from any liability which it may have to any indemnified
party, and the indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified party and any others
the indemnifying party may designate in such proceeding and shall pay 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, but the fees and expenses of such counsel shall be at the
expense of such indemnified party unless (i) the use of counsel chosen by the indemnifying party to
represent the indemnified party would present such counsel with a actual or potential differing
interest; (ii) the actual or potential defendants in, or targets of, any such action include both
the indemnified party and the indemnifying party and the
27
indemnified party shall have reasonably concluded that there may be legal defenses available
to it and/or other indemnified parties that are different from or additional to those available to
the indemnifying party; (iii) the indemnifying party shall not have employed counsel satisfactory
to the indemnified party to represent the indemnified party within a reasonable time after notice
of the institution of such action; or (iv) the indemnifying party shall authorize in writing the
indemnified party to employ separate counsel at the expense of the indemnifying party. It is
understood that the indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for (i) the fees and expenses of more than one separate firm (in addition
to any local counsel) for all Underwriters and all persons, if any, who control any Underwriter
within the meaning of either Section 16 of the Securities Act or Section 20 of the Exchange Act or
who are affiliates of any Underwriter within the meaning of Rule 405 under the Securities Act, (ii)
the fees and expenses of more than one separate firm (in addition to any local counsel) for the
Company, its directors, its officers who sign the Registration Statement and each person, if any,
who controls the Company within the meaning of either such Section, (iii) the fees and expenses of
more than one separate firm (in addition to any local counsel) for the Selling Shareholder and all
persons, if any, who control the Selling Shareholder within the meaning of either such Section, and
that all such fees and expenses shall be reimbursed as they are incurred. In the case of any such
separate firm for the Underwriters and such control persons and affiliates of any Underwriters,
such firm shall be designated in writing by the Representative. In the case of any such separate
firm for the Company, and such directors, officers and control persons of the Company, such firm
shall be designated in writing by the Company. In the case of any such separate firm for the
Selling Shareholder and such control persons of the Selling Shareholder, such firm shall be
designated in writing by the Selling Shareholder. The indemnifying party shall not be liable for
any settlement of any proceeding effected without its written consent, such consent not to be
unreasonably withheld, 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. No indemnifying party shall, without
the prior written consent of the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party, unless such settlement (i)
includes an unconditional release of such indemnified party from all liability on claims that are
the subject matter of such proceeding and (ii) does not include a statement as to or an admission
of fault, culpability or a failure to act, by or on behalf of any indemnified party.
(e) To the extent the indemnification provided for in Section 10(a), 10(b) or 10(c) is
unavailable to an indemnified party or insufficient in respect of any losses, claims, damages or
liabilities referred to therein, then each indemnifying party under such paragraph, in lieu of
indemnifying such indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or liabilities (i) in such
proportion as is appropriate to reflect the relative benefits received by the indemnifying party or
parties on the one hand and the indemnified party or parties on the other hand from the offering
28
of the Shares or (ii) if the allocation provided by clause 10(e)(i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause 10(e)(i) above but also the relative fault of the indemnifying party or
parties on the one hand and of the indemnified party or parties on the other hand in connection
with the statements or omissions that resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative benefits received by the Company
and the Selling Shareholder on the one hand and the Underwriters on the other hand in connection
with the offering of the Shares shall be deemed to be in the same respective proportions as the net
proceeds from the offering of the Shares (before deducting expenses) received by each of the
Company and the Selling Shareholder and the total underwriting discounts and commissions received
by the Underwriters, in each case as set forth in the table on the cover of the Prospectus, bear to
the aggregate Public Offering Price of the Shares. The relative fault of the Company or the
Selling Shareholder, as the case may be, on the one hand and the Underwriters on the other hand
shall be determined by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a material fact relates
to information supplied by the Company or the Selling Shareholder or by the Underwriters and the
parties’ relative intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Underwriters’ respective obligations to contribute pursuant to
this Section 10 are several in proportion to the respective number of Shares they have purchased
hereunder, and not joint. The liability of the Selling Shareholder under the contribution
agreement contained in this paragraph shall be limited to an amount equal to the aggregate Public
Offering Price of the Shares sold by the Selling Shareholder under this Agreement.
(f) The Company, Copa Airlines, the Selling Shareholder and the Underwriters agree that it
would not be just or equitable if contribution pursuant to this Section 10 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 that does not take account of the equitable considerations referred to
in Section 10(e). The amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in Section 10(e) shall be deemed to include, subject to
the limitations set forth above, 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 Section 10, no Underwriter shall be required to contribute
any amount in excess of the amount by which the total price at which the Shares underwritten by it
and distributed to the public were offered to the public exceeds the amount of any damages that
such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The remedies provided for in
this Section 10 are not exclusive and shall not limit any rights or remedies that may otherwise be
available to any indemnified party at law or in equity.
29
(g) The indemnity and contribution provisions contained in this Section 10 and the
representations, warranties and other statements of the Company, Copa Airlines and the Selling
Shareholder contained in this Agreement shall remain operative and in full force and effect
regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of
any Underwriter, any person controlling any Underwriter or any affiliate of any Underwriter, any
Selling Shareholder or any person controlling any Selling Shareholder, or the Company, its officers
or directors or any person controlling the Company and (iii) acceptance of and payment for any of
the Shares.
11. Termination. The Underwriters may terminate this Agreement by notice given by you to the
Company, if after the execution and delivery of this Agreement and prior to the Closing Date (i)
trading generally shall have been suspended or materially limited on, or by, as the case may be,
any of the NYSE, the American Stock Exchange or the Nasdaq National Market (ii) trading of any
securities of the Company shall have been suspended on any exchange or in any over the counter
market (iii) material disruption in securities settlement, payment or clearance services in the
United States or Panama shall have occurred, (iv) a change or development involving a prospective
change in Panamanian taxation affecting the Company, the Shares or the transfer thereof shall have
occurred, which makes it, in your judgment, impracticable or inadvisable to proceed with the offer,
sale or delivery of the Shares on the terms and in the manner contemplated in the Time of Sale
Prospectus or the Prospectus (v) any moratorium on commercial banking activities shall have been
declared by Federal, New York State or Panamanian authorities or (vi) there shall have occurred any
outbreak or escalation of hostilities, or any change in financial, political or economic conditions
or any calamity or crisis that, in your judgment, is material and adverse and which, singly or
together with any other event specified in this clause (vi), makes it, in your judgment,
impracticable or inadvisable to proceed with the offer, sale or delivery of the Shares on the terms
and in the manner contemplated in the Time of Sale Prospectus or the Prospectus.
12. Effectiveness; Defaulting Underwriters. This Agreement shall become effective upon the
execution and delivery hereof by the parties hereto.
If, on the Closing Date or an Option Closing Date, as the case may be, any one or more of the
Underwriters shall fail or refuse to purchase Shares that it has or they have agreed to purchase
hereunder on such date, and the aggregate number of Shares that such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase is not more than one-tenth of the aggregate
number of the Shares to be purchased on such date, the other Underwriters shall be obligated
severally in the proportions that the number of Firm Shares set forth opposite their respective
names in Schedule I bears to the aggregate number of Firm Shares set forth opposite the names of
all such non-defaulting Underwriters, or in such other proportions as you may specify, to purchase
the Shares that such defaulting Underwriter or Underwriters agreed but failed or refused to
purchase on such date; provided that in no event shall the number of Shares that any Underwriter
has agreed to purchase pursuant to this Agreement be increased pursuant to this Section 12 by an
amount in excess of one-ninth of such number of Shares without the
30
written consent of such Underwriter. If, on the Closing Date, any Underwriter or Underwriters
shall fail or refuse to purchase Firm Shares and the aggregate number of Firm Shares with respect
to which such default occurs is more than one-tenth of the aggregate number of Firm Shares to be
purchased on such date, and arrangements satisfactory to you, the Company and the Selling
Shareholder for the purchase of such Firm Shares are not made within 36 hours after such default,
this Agreement shall terminate without liability on the part of any non-defaulting Underwriter, the
Company or the Selling Shareholder. In any such case either you, the Company or the Selling
Shareholder shall have the right to postpone the Closing Date, but in no event for longer than
seven days, in order that the required changes, if any, in the Registration Statement, in the Time
of Sale Prospectus, in the Prospectus or in any other documents or arrangements may be effected.
If, on an Option Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase
Additional Shares and the aggregate number of Additional Shares with respect to which such default
occurs is more than one-tenth of the aggregate number of Additional Shares to be purchased on such
Option Closing Date, the non-defaulting Underwriters shall have the option to (i) terminate their
obligation hereunder to purchase the Additional Shares to be sold on such Option Closing Date or
(ii) purchase not less than the number of Additional Shares that such non-defaulting Underwriters
would have been obligated to purchase in the absence of such default. Any action taken under this
paragraph shall not relieve any defaulting Underwriter from liability in respect of any default of
such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of them, because of any
failure or refusal on the part of the Company or the Selling Shareholder to comply with the terms
or to fulfill any of the conditions of this Agreement, or if for any reason the Company or the
Selling Shareholder shall be unable to perform its obligations under this Agreement, the Company or
the Selling Shareholder will reimburse the Underwriters or such Underwriters as have so terminated
this Agreement with respect to themselves, severally, for all out-of-pocket expenses (including the
fees and disbursements of their counsel) reasonably incurred by such Underwriters in connection
with this Agreement or the offering contemplated hereunder.
13. Entire Agreement. This Agreement, together with any contemporaneous written agreements
and any prior written agreements (to the extent not superseded by this Agreement) that relate to
the offering of the Shares, represents the entire agreement between the Company and the
Underwriters with respect to the preparation of any preliminary prospectus, the Time of Sale
Prospectus, the Prospectus, the conduct of the offering, and the purchase and sale of the Shares.
14. Counterparts. This Agreement may be signed in two or more counterparts, each of which
shall be an original, with the same effect as if the signatures thereto and hereto were upon the
same instrument.
15. Applicable Law. This Agreement shall be governed by and construed in accordance with the
internal laws of the State of New York.
31
16. Submission to Jurisdiction; Appointment of Agent for Service. (a) The Company
irrevocably submits to the non-exclusive jurisdiction of the courts of the State of the New York
and of the United States sitting in the Borough of Manhattan over any suit, action or proceeding
arising out of or relating to this Agreement, the Prospectus, the Registration Statement or the
offering of the Shares. The Company irrevocably waives, to the fullest extent permitted by law,
any objection that it may now or hereafter have to the laying of venue of any such suit, action or
proceeding brought in such a court and any claim that any such suit, action or proceeding brought
in such a court has been brought in an inconvenient forum. To the extent that the Company has or
hereafter may acquire any immunity (on the grounds of sovereignty or otherwise) from the
jurisdiction of any court or from any legal process with respect to itself or its property, the
Company irrevocably waives, to the fullest extent permitted by law, such immunity in respect of any
such suit, action or proceeding.
(b) Copa Airlines irrevocably submits to the non-exclusive jurisdiction of the courts of the
State of the New York and of the United States sitting in the Borough of Manhattan over any suit,
action or proceeding arising out of or relating to this Agreement and irrevocably waives, to the
fullest extent permitted by law, any objection that it may now or hereafter have to the laying of
venue of any such suit, action or proceeding brought in such a court and any claim that any such
suit, action or proceeding brought in such a court has been brought in an inconvenient forum. To
the extent that Copa Airlines has or hereafter may acquire any immunity (on the grounds of
sovereignty or otherwise) from the jurisdiction of any court or from any legal process with respect
to itself or its property, Copa Airlines irrevocably waives, to the fullest extent permitted by
law, such immunity in respect of any such suit, action or proceeding.
(c) Each of the Company and Copa Airlines hereby irrevocably appoints CT Corporation, with
offices at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇., ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ as its agent for service of process in any
suit, action or proceeding described in the preceding paragraph and agrees that service of process
in any such suit, action or proceeding may be made upon it at the office of such agent. Each of
the Company and Copa Airlines waives, to the fullest extent permitted by law, any other
requirements of or objections to personal jurisdiction with respect thereto. Each of the Company
and Copa Airlines represents and warrants that such agent has agreed to act as the Company’s and
Copa Airlines’ agent for service of process, and each of the Company and Copa Airlines agrees to
take any and all action, including the filing of any and all documents and instruments, that may be
necessary to continue such appointment in full force and effect.
17. Taxes. All payments to be made by the Company, Copa Airlines and the Selling Shareholder
under this Agreement shall be paid free and clear of and without deduction or withholding for or on
account of, any present or future taxes, levies or imposts by Panama or by any department, agency
or other political subdivision or taxing authority thereof or therein, and all interest, penalties
or similar liabilities with respect thereto (collectively, “Taxes”). If any Taxes are required by
law to be deducted or withheld in connection with such payments, the Company, Copa Airlines and the
Selling Shareholder will increase the amount paid so that the
32
net amount received by the Underwriters equals the amount that would have been received in the
absence of such deduction or withholding.
18. No Fiduciary Duty. Each of the Company and the Selling Shareholder acknowledges that in
connection with the offering of the Shares: (a) the Underwriters have acted at arms length, are
not agents of, and owe no fiduciary duties to, the Company, the Selling Shareholder or any other
person, (b) the Underwriters owe the Company and the Selling Shareholder only those duties and
obligations set forth in this Agreement and (c) the Underwriters may have interests that differ
from those of the Company and the Selling Shareholder. Each of the Company and the Selling
Shareholder waives to the full extent permitted by applicable law any claims it may have against
the Underwriters arising from an alleged breach of fiduciary duty in connection with the offering
of the Shares.
19. Headings. The headings of the sections of this Agreement have been inserted for
convenience of reference only and shall not be deemed a part of this Agreement.
20. Notices. All communications hereunder shall be in writing and effective only upon receipt
and if to the Underwriters shall be delivered, mailed or sent to you at: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Equity Syndicate Desk, with a
copy to the Legal Department; if to the Company shall be delivered, mailed or sent to ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇, Complejo Business Park, Torre Norte, Parque
▇▇▇▇▇▇▇, Panama City, Panama, Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Fax: ▇▇▇-▇▇▇-▇▇▇▇; and if to the Selling
Shareholder shall be delivered, mailed or sent to ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇ ▇▇▇▇▇, with a copy to the office of General Counsel.
[signature pages follow]
33
| Very truly yours, Copa Holdings, S.A. |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| Compañía Panameña de Aviación, S.A |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
[Signature Page to Underwriting Agreement]
▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ |
) | |||||||
| : ss. | ||||||||
COUNTY OF NEW YORK |
) |
On this day of , 2008, before me, a notary public within and for said
country, personally appeared , to me personally known who
being duly sworn, did say that such person is and authorized signatory of ,
which executed the foregoing instrument, and acknowledges said instrument to be the free act and
deed of said corporation.
IN TESTIMONY WHEREOF, I have hereunto set my hand and official seal.
| By | ||||
| (Notary Public) | ||||
| Name: | ||||
My Commission Expires:
(SEAL)
(SEAL)
35
The Selling Shareholder:
| By: | Continental Airlines, Inc. | |||
| By: | ||||
| Name: | ||||
| Title: | ||||
[Signature Page to Underwriting Agreement]
▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ |
) | |||||||
| : ss. | ||||||||
COUNTY OF NEW YORK |
) |
On this day of , 2008, before me, a notary public within and for said
country, personally appeared , to me personally known who
being duly sworn, did say that such person is and authorized signatory of ,
which executed the foregoing instrument, and acknowledges said instrument to be the free act and
deed of said corporation.
IN TESTIMONY WHEREOF, I have hereunto set my hand and official seal.
| By | ||||
| (Notary Public) | ||||
| Name: | ||||
My Commission Expires:
(SEAL)
(SEAL)
37
Accepted as of the date hereof.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
Acting severally on behalf of itself and the several
Underwriters named in Schedule I hereto
Underwriters named in Schedule I hereto
By:
|
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated | |||
By: |
||||
| Name: | ||||
| Title: |
[Signature Page to Underwriting Agreement]
▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ |
) | |||||||
| : ss. | ||||||||
COUNTY OF NEW YORK |
) |
On this day of , 2008, before me, a notary public within and for said
country, personally appeared , to me personally known who
being duly sworn, did say that such person is and authorized signatory of ,
which executed the foregoing instrument, and acknowledges said instrument to be the free act and
deed of said corporation.
IN TESTIMONY WHEREOF, I have hereunto set my hand and official seal.
| By | ||||
| (Notary Public) | ||||
| Name: | ||||
My Commission Expires:
(SEAL)
(SEAL)
39
SCHEDULE I
| Underwriter | Number of Firm Shares To Be Purchased |
|
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
|
||
UBS Securities LLC
|
||
Total:
|
||
I-1
SCHEDULE II
Time of Sale Prospectus
1. Preliminary Prospectus issued May , 2008
2. Free Writing Prospectuses:
II-1
EXHIBIT A
FORM OF LOCK-UP LETTER
May , 2008
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Ladies and Gentlemen:
The undersigned understands that ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated (“▇▇▇▇▇▇ ▇▇▇▇▇▇▇”) proposes
to enter into an Underwriting Agreement (the “Underwriting Agreement”) with Copa Holdings, S.A. a
Panamanian corporation (the “Company”), providing for the public offering (the “Public Offering”)
by the several Underwriters (the “Underwriters”), including ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ as the representative
(the “Representative”) of the several Underwriters, of shares (the “Shares”) of Class A Common
Stock, without par value, of the Company (the “Common Stock”).
To induce the Underwriters that may participate in the Public Offering to continue their
efforts in connection with the Public Offering, the undersigned hereby agrees that, without the
prior written consent of the Representative on behalf of the Underwriters, it will not, during the
period commencing on the date hereof and ending 90 days after the date of the final prospectus
relating to the Public Offering (the “Prospectus”), (1) offer, pledge, sell, contract to sell, sell
any option or contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly,
any shares of Common Stock or any securities convertible into or exercisable or exchangeable for
Common Stock, or (2) enter into any swap or other arrangement that transfers to another, in whole
or in part, any of the economic consequences of ownership of the Common Stock, whether any such
transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or
such other securities, in cash or otherwise. The foregoing sentence shall not apply to (a)
transactions relating to shares of Common Stock or other securities acquired in open market
transactions after the completion of the Public Offering, provided that (i) no filing under Section
16(a) of the Exchange Act shall be required or shall be voluntarily made in connection with
subsequent sales of Common Stock or other securities acquired in such open market transactions and
(ii) no filing under Section 16(a) of the Exchange Act, reporting a reduction in beneficial
ownership of shares of Common Stock, shall be required or shall be voluntarily made during the
restricted period referred to in the foregoing sentence or (b) transfers of shares of Common Stock
made under a trading plan pursuant to Rule 10b5-1 under the Securities Exchange Act of 1934, as
amended, which trading plan is in existence on the date hereof. In addition, the undersigned
agrees that, without the prior written consent of the Representative on behalf of the Underwriters,
it will not, during the period commencing on the date hereof and ending 90 days after the date of
the Prospectus, make any demand for or exercise any right with respect to, the registration of any
shares of Common Stock or any security convertible into or exercisable or exchangeable for Common
Stock. The undersigned also agrees and consents to the entry of stop transfer instructions
with the Company’s transfer agent and registrar against the transfer of the undersigned’s
shares of Common Stock except in compliance with the foregoing restrictions.
The undersigned understands that the Company and the Underwriters are relying upon this
agreement in proceeding toward consummation of the Public Offering. The undersigned further
understands that this agreement is irrevocable and shall be binding upon the undersigned’s heirs,
legal representatives, successors and assigns.
Whether or not the Public Offering actually occurs depends on a number of factors, including
market conditions. Any Public Offering will only be made pursuant to an Underwriting Agreement,
the terms of which are subject to negotiation between the Company and the Underwriters.
| Very truly yours, | ||
| (Name) | ||
| (Address) | ||