EXHIBIT 1.1
COACH, INC.
COMMON STOCK
------
FORM OF
UNDERWRITING AGREEMENT
_________ __, 2000
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
Prudential Securities Incorporated
As representatives of the several Underwriters
named in Schedule I hereto
c/o Goldman, Sachs & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Coach, Inc. (the "Company"), a Maryland corporation and a wholly-owned
subsidiary of ▇▇▇▇ ▇▇▇ Corporation, a Maryland corporation ("▇▇▇▇ ▇▇▇"),
proposes, subject to the terms and conditions stated herein, to issue and sell
to the Underwriters named in Schedule I hereto (the "Underwriters") an aggregate
of 7,380,000 shares (the "Firm Shares") and, at the election of the
Underwriters, up to 1,107,000 additional shares (the "Optional Shares") of
Common Stock, par value $0.01 per share ("Stock"), of the Company (the Firm
Shares and the Optional Shares that the Underwriters elect to purchase pursuant
to Section 2 hereof being collectively called the "Shares").
1. The Company and ▇▇▇▇ ▇▇▇, jointly and severally, represent and
warrant to, and agree with, each of the Underwriters that:
(a) A registration statement on Form S-1 (File No. 333-39502) (the
"Initial Registration Statement") in respect of the Shares has been
filed with the Securities and Exchange Commission (the "Commission");
the Initial Registration Statement and any post-effective amendment
thereto, each in the form heretofore delivered to you, and, excluding
exhibits thereto, to you for each of the other Underwriters, have been
declared effective by the Commission in such form; other than a
registration statement, if any, increasing the size of the offering (a
"Rule 462(b) Registration Statement"), filed pursuant to Rule 462(b)
under the Securities Act of 1933, as amended (the "Act"), which became
effective upon filing, no other document with respect to the Initial
Registration Statement has heretofore been filed with the Commission;
and no stop order suspending the effectiveness of the Initial
Registration Statement, any post-effective amendment thereto or the
Rule 462(b) Registration Statement, if any, has been issued and no
proceeding for that purpose has been initiated or threatened by the
Commission (any preliminary prospectus included in the Initial
Registration Statement or filed with the Commission pursuant to Rule
424(a) of the rules and regulations of the Commission under the Act is
hereinafter called a "Preliminary Prospectus"; the various parts
of the Initial Registration Statement and the Rule 462(b) Registration
Statement, if any, including all exhibits thereto and including the
information contained in the form of final prospectus filed with the
Commission pursuant to Rule 424(b) under the Act in accordance with
Section 5(a) hereof and deemed by virtue of Rule 430A under the Act to
be part of the Initial Registration Statement at the time it was
declared effective, each as amended at the time such part of the
Initial Registration Statement became effective or such part of the
Rule 462(b) Registration Statement, if any, became or hereafter becomes
effective, are hereinafter collectively called the "Registration
Statement"; and such final prospectus, in the form first filed pursuant
to Rule 424(b) under the Act, is hereinafter called the "Prospectus";
(b) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary
Prospectus, at the time of filing thereof, conformed in all material
respects to the requirements of the Act and the rules and regulations
of the Commission thereunder, and did not contain an untrue statement
of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
PROVIDED, HOWEVER, that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter through ▇▇▇▇▇▇▇, Sachs & Co. expressly for use therein;
(c) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements
of the Act and the rules and regulations of the Commission thereunder
and do not and will not, as of the applicable effective date as to the
Registration Statement and any amendment thereto, and as of the
applicable filing date as to the Prospectus and any amendment or
supplement thereto, contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, in the case of
the Registration Statement or an amendment thereto, or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading, in the case of the Prospectus or any
amendment or supplement thereto; PROVIDED, HOWEVER, that this
representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information
furnished in writing to the Company by an Underwriter through ▇▇▇▇▇▇▇,
Sachs & Co. expressly for use therein;
(d) Neither the Company nor any of its subsidiaries has sustained
since the date of the latest audited financial statements included in
the Prospectus any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action,
order or decree, except to the extent that any such loss or
interference would not, individually or in the aggregate, have a
material adverse effect on the general affairs, management, financial
position, stockholders' equity or results of operations of the Company
and its subsidiaries, taken as a whole, or would prevent the Company
from performing its obligations hereunder (a "Material Adverse
Effect"), or otherwise than as set forth or contemplated in the
Prospectus; and, since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not
been any change in the capital stock of the Company or any of its
subsidiaries or long-term debt of the Company or any of its
subsidiaries of more than ten percent (10%) from the long-term debt
shown on the most recent balance sheet included in the Registration
Statement (but not including any debt assumed by the Company in
connection with its
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separation from ▇▇▇▇ ▇▇▇), or any material adverse change, or any
development involving a prospective material adverse change, in or
affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries taken as a whole, in each case, otherwise than as set
forth or contemplated in the Prospectus;
(e) The Company and its subsidiaries own no real property and have
good and marketable title to all personal property owned by them, in
each case free and clear of all liens, encumbrances and defects except
such as are described in the Prospectus or such as would not have a
Material Adverse Effect; and any real property, buildings, stores and
other premises held under lease by the Company and its subsidiaries or
by ▇▇▇▇ ▇▇▇ for use by the Company and its subsidiaries are held by
them under valid, subsisting and enforceable leases with such
exceptions as would not have a Material Adverse Effect;
(f) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of
Maryland, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus, and
has been duly qualified as a foreign corporation for the transaction of
business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties or conducts any
business so as to require such qualification, except to the extent that
the failure to be so qualified or in good standing in any such
jurisdiction would not have a Material Adverse Effect; and each
subsidiary of the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of its
jurisdiction of incorporation, except to the extent that the failure to
be in good standing would not have a Material Adverse Effect;
(g) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued, are fully
paid and non-assessable and conform in all material respects to the
description of the Stock contained in the Prospectus and are owned
beneficially and of record by ▇▇▇▇ ▇▇▇; and 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
(except for directors' qualifying shares) are owned directly or
indirectly by the Company or by ▇▇▇▇ ▇▇▇ (and will be transferred to
the Company following the execution of this Agreement), free and clear
of all liens, encumbrances, equities or claims, except for any such
liens, encumbrances, equities, or claims that would not have a Material
Adverse Effect;
(h) The unissued Shares to be issued and sold by the Company to the
Underwriters hereunder have been duly and validly authorized and, when
issued and delivered against payment therefor as provided herein, will
be duly and validly issued and fully paid and non-assessable and will
conform in all material respects to the description of the Stock
contained in the Prospectus;
(i) The issue and sale of the Shares by the Company and the
compliance by the Company with all of the provisions of this Agreement
and the consummation of the transactions herein contemplated will not
(i) result in any violation of any provisions of the Charter or By-Laws
of the Company; or (ii) conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any of its subsidiaries
is a party or by which the Company or any of its subsidiaries is bound
or to which any of the
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property or assets of the Company or any of its subsidiaries is
subject, or result in any violation of the provisions of any statute or
any order, rule or regulation of any court or governmental agency or
body having jurisdiction over the Company or any of its subsidiaries or
any of their properties, except for such conflicts, breaches,
violations, or defaults which have been consented to or waived prior to
the execution and delivery of this Agreement or which would not have a
Material Adverse Effect; and no consent, approval, authorization,
order, registration or qualification of or with any such court or
governmental agency or body is required for the issue and sale of the
Shares or the consummation by the Company of the transactions
contemplated by this Agreement, except the registration under the 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 and except for such
consents, approvals, authorizations, orders, registrations, or
qualifications that would not have a Material Adverse Effect;
(j) Neither the Company nor any of its subsidiaries is (i) in
violation of its Charter or By-laws or (ii) in default in the
performance or observance of any obligation, agreement, covenant or
condition contained in any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which it is a
party or by which it or any of its properties may be bound, except for
such defaults that would not have a Material Adverse Effect;
(k) The statements set forth in the Prospectus under the caption
"Description of Capital Stock", insofar as they purport to constitute a
summary of the terms of the Stock, under the caption "Certain
Relationships and Related Transactions", and under the caption
"Underwriting", other than information furnished to the Company by any
Underwriter through ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. expressly for use therein,
insofar as they purport to describe the provisions of the laws and
documents referred to therein, are accurate and complete in all
material respects;
(l) Other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its
subsidiaries or ▇▇▇▇ ▇▇▇ (with respect to the Company) is a party or of
which any property of the Company or any of its subsidiaries or ▇▇▇▇
▇▇▇ (with respect to the Company) is the subject which, if determined
adversely to the Company or any of its subsidiaries or ▇▇▇▇ ▇▇▇ (with
respect to the Company), would, individually or in the aggregate, have
a Material Adverse Effect and, to the Company's knowledge, no such
proceedings are threatened or contemplated by governmental authorities
or threatened by others;
(m) The Company is not and, after giving effect to the offering and
sale of the Shares, will not be an "investment company", as such term
is defined in the Investment Company Act of 1940, as amended (the
"Investment Company Act");
(n) Neither the Company nor any of its affiliates does business with
the government of Cuba or with any person or affiliate located in Cuba
within the meaning of Section 517.075, Florida Statutes;
(o) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, who have certified certain financial
statements of the Company and its subsidiaries, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder.
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(p) The Company and its subsidiaries own or possess valid licenses or
other rights to use all patents, trademarks, service marks, trade
names, copyrights, know-how, trade secrets and other intellectual
property (collectively, the "Intellectual Property") necessary to
conduct and carry on the business of the Company and its subsidiaries
as described in the Prospectus, except as would not have a Material
Adverse Effect, and except as set forth in the Prospectus, the Company
and its subsidiaries and ▇▇▇▇ ▇▇▇ have not received any written notice
of infringement or conflict with (and the Company and ▇▇▇▇ ▇▇▇ know of
no such infringement or conflict with) asserted rights of others with
respect to any Intellectual Property which, if determined adversely to
the Company or its subsidiaries, would individually or in the aggregate
have a Material Adverse Effect;
(q) Each of the Master Separation Agreement, General Assignment and
Assumption Agreement, Employee Matters Agreement, Tax Sharing
Agreement, Real Estate Matters Agreement, and Indemnification and
Insurance Matters Agreement (collectively, the "Intercompany
Agreements"), has been duly authorized, executed and delivered by the
Company and ▇▇▇▇ ▇▇▇, is in full force and effect, and constitutes a
valid and legally binding obligation of the Company and ▇▇▇▇ ▇▇▇,
enforceable against each of the Company and ▇▇▇▇ ▇▇▇ in accordance with
its terms, subject to bankruptcy, insolvency, reorganization and other
laws of general applicability relating to or affecting creditors'
rights and to general equity principles; and
(r) The Company and its subsidiaries, taken as a whole, are insured,
or are entitled to the benefits of insurance, by insurers of recognized
financial responsibility against such losses and risks and in such
amounts as are prudent and customary in the business in which they are
engaged; and neither the Company nor any of its subsidiaries has any
reason to believe that it will not be able to obtain sufficient
insurance coverage as and when such coverage expires as may be
necessary to continue its business.
2. Subject to the terms and conditions herein set forth, (a) the
Company agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company, at
a purchase price per share of $_______ the number of Firm Shares set forth
opposite the name of such Underwriter in Schedule I hereto and (b) in the event
and to the extent that the Underwriters shall exercise the election to purchase
Optional Shares as provided below, the Company agrees to issue and sell to each
of the Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase from the Company, at the purchase price per share set forth
in clause (a) of this Section 2, that portion of the number of Optional Shares
as to which such election shall have been exercised (to be adjusted by you so as
to eliminate fractional shares) determined by multiplying such number of
Optional Shares by a fraction, the numerator of which is the maximum number of
Optional Shares which such Underwriter is entitled to purchase as set forth
opposite the name of such Underwriter in Schedule I hereto and the denominator
of which is the maximum number of Optional Shares that all of the Underwriters
are entitled to purchase hereunder.
The Company hereby grants to the Underwriters the right to purchase at
their election up to 1,107,000 Optional Shares, at the purchase price per share
set forth in the paragraph above, for the sole purpose of covering sales of
shares in excess of the number of Firm Shares. Any such election to purchase
Optional Shares may be exercised only by written notice from you to the Company,
given within a period of 30 calendar days after the date of this Agreement,
setting forth the aggregate number of Optional Shares to be purchased and the
date on which such Optional Shares are to be delivered, as determined by you but
in no event earlier than the First Time of Delivery (as defined in
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Section 4 hereof) or, unless you and the Company otherwise agree in writing,
earlier than two or later than ten business days after the date of such notice.
3. Upon the authorization by you of the release of the Firm Shares,
the several Underwriters propose to offer the Firm Shares for sale upon the
terms and conditions set forth in the Prospectus.
4. (a) The Shares to be purchased by each Underwriter hereunder,
in definitive form, and in such authorized denominations and registered
in such names as ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. may request upon at least
forty-eight hours' prior notice to the Company shall be delivered by or
on behalf of the Company to ▇▇▇▇▇▇▇, Sachs & Co., through the
facilities of the Depository Trust Company ("DTC"), for the account of
such Underwriter, against payment by or on behalf of such Underwriter
of the purchase price therefor by wire transfer of Federal (same-day)
funds to the account specified by the Company to ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
at least forty-eight hours in advance. The Company will cause the
certificates representing the Shares to be made available for checking
and packaging at least twenty-four hours prior to the Time of Delivery
(as defined below) with respect thereto at the office of DTC or its
designated custodian (the "Designated Office"). The time and date of
such delivery and payment shall be, with respect to the Firm Shares,
9:30 a.m., New York City time, on ______ __, 2000 or such other time
and date as ▇▇▇▇▇▇▇, Sachs & Co. and the Company may agree upon in
writing, and, with respect to the Optional Shares, 9:30 a.m., New York
time, on the date specified by ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. in the written
notice given by ▇▇▇▇▇▇▇, Sachs & Co. of the Underwriters' election to
purchase such Optional Shares, or such other time and date as ▇▇▇▇▇▇▇,
Sachs & Co. and the Company may agree upon in writing. Such time and
date for delivery of the Firm Shares is herein called the "First Time
of Delivery", such time and date for delivery of the Optional Shares,
if not the First Time of Delivery, is herein called the "Second Time of
Delivery", and each such time and date for delivery is herein called a
"Time of Delivery".
(b) The documents to be delivered at each Time of Delivery by or on
behalf of the parties hereto pursuant to Section 7 hereof, including
the cross receipt for the Shares and any additional documents requested
by the Underwriters pursuant to Section 7(n) hereof, will be delivered
at the offices of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, ▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the "Closing Location"), and the Shares will be
delivered at the Designated Office, all at such Time of Delivery. A
meeting will be held at the Closing Location at 3 p.m., New York City
time, on the New York Business Day next preceding such Time of
Delivery, at which meeting the final drafts of the documents to be
delivered pursuant to the preceding sentence will be available for
review by the parties hereto. For the purposes of this Section 4, "New
York Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday
and Friday which is not a day on which banking institutions in New York
are generally authorized or obligated by law or executive order to
close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and to
file such Prospectus pursuant to Rule 424(b) under the Act not later
than the Commission's close of business on the second business day
following the execution and delivery of this Agreement, or, if
applicable, such earlier time as may be required by Rule 430A(a)(3)
under the Act; to make no further amendment or any supplement to the
Registration Statement or Prospectus which shall be disapproved by you
promptly after reasonable notice thereof; to advise you, promptly
6
after it receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been filed
and to furnish you with copies thereof; to advise you, promptly after
it receives notice thereof, of the issuance by the Commission of any
stop order or of any order preventing or suspending the use of any
Preliminary Prospectus or prospectus, of the suspension of the
qualification of the Shares for offering or sale in any jurisdiction,
of the initiation or threatening of any proceeding for any such
purpose, or of any request by the Commission for the amending or
supplementing of the Registration Statement or Prospectus or for
additional information; and, in the event of the issuance of any stop
order or of any order preventing or suspending the use of any
Preliminary Prospectus or prospectus or suspending any such
qualification, promptly to use its best efforts to obtain the
withdrawal of such order;
(b) Promptly from time to time to take such action as you may
reasonably request to qualify the Shares for offering and sale under
the securities laws of such jurisdictions as you may request and to
comply with such laws so as to permit the continuance of sales and
dealings therein in such jurisdictions for as long as may be necessary
to complete the distribution of the Shares, provided that in connection
therewith the Company shall not be required to qualify as a foreign
corporation or to file a general consent to service of process in any
jurisdiction or to take any other action which would subject it to
taxation;
(c) Prior to 12:00, noon, New York City time, on the New York
Business Day next succeeding the date of this Agreement and from time
to time, to furnish the Underwriters with copies of the Prospectus in
New York City in such quantities as you may reasonably request, and, if
the delivery of a prospectus is required at any time prior to the
expiration of nine months after the time of issue of the Prospectus in
connection with the offering or sale of the Shares and if at such time
any event shall have occurred as a result of which the Prospectus as
then amended or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made when such Prospectus is delivered, not misleading,
or, if for any other reason it shall be necessary during such period to
amend or supplement the Prospectus in order to comply with the Act, to
notify you and upon your request to prepare and furnish without charge
to each Underwriter and to any dealer in securities as many copies as
you may from time to time reasonably request of an amended Prospectus
or a supplement to the Prospectus which will correct such statement or
omission or effect such compliance, and in case any Underwriter is
required to deliver a prospectus in connection with sales of any of the
Shares at any time nine months or more after the time of issue of the
Prospectus, upon your request but at the expense of such Underwriter,
to prepare and deliver to such Underwriter as many copies as you may
request of an amended or supplemented Prospectus complying with Section
10(a)(3) of the Act;
(d) To make generally available to its securityholders as soon
as practicable, but in any event not later than eighteen months after
the effective date of the Registration Statement (as defined in Rule
158(c) under the Act), an earnings statement of the Company and its
subsidiaries (which need not be audited) complying with Section 11(a)
of the Act and the rules and regulations thereunder (including, at the
option of the Company, Rule 158);
(e) During the period beginning from the date hereof and
continuing to and including the date 180 days after the date of the
Prospectus, not to offer, sell, contract to sell or otherwise dispose
of, except as provided hereunder any securities of the Company that are
substantially
7
similar to the Shares, including but not limited to any securities that
are convertible into or exchangeable for, or that represent the right
to receive, Stock or any such substantially similar securities (other
than pursuant to (i) employee stock option plans or other employee or
director incentive plans or (ii) any plan allowing for the exchange of
▇▇▇▇ ▇▇▇ capital stock or rights to acquire ▇▇▇▇ ▇▇▇ capital stock for
Company capital stock or rights to acquire Company capital stock,
existing on, or upon the conversion or exchange of convertible or
exchangeable securities outstanding as of, the date of this Agreement),
without your prior written consent;
(f) During a period of three years from the effective date of
the Registration Statement, to furnish to its stockholders as soon as
practicable after the end of each fiscal year an annual report
(including a balance sheet and statements of income, stockholders'
equity and cash flows of the Company and its consolidated subsidiaries
certified by independent public accountants) and, as soon as
practicable after the end of each of the first three quarters of each
fiscal year (beginning with the fiscal quarter ending after the
effective date of the Registration Statement), to make available to its
stockholders consolidated summary financial information of the Company
and its subsidiaries for such quarter in reasonable detail;
(g) During a period of three years from the effective date of
the Registration Statement, to furnish to you copies of all reports or
other communications (financial or other) furnished to stockholders,
and to deliver to you (i) as soon as they are available, copies of any
reports and financial statements furnished to or filed with the
Commission or any national securities exchange on which any class of
securities of the Company is listed; and (ii) such additional
information that is available without undue expense concerning the
business and financial condition of the Company as you may from time to
time reasonably request (such financial statements to be on a
consolidated basis to the extent the accounts of the Company and its
subsidiaries are consolidated in reports furnished to its stockholders
generally or to the Commission);
(h) To use the net proceeds received by it from the sale of the
Shares pursuant to this Agreement in the manner specified in the
Prospectus under the caption "Use of Proceeds";
(i) To use its best efforts to list, subject to notice of
issuance, the Shares on the New York Stock Exchange (the "Exchange");
(j) To file with the Commission such information on Form 10-Q
orForm 10-K as may be required by Rule 463 under the Act; and
(k) If the Company elects to rely upon Rule 462(b), the Company
shall file a Rule 462(b) Registration Statement with the Commission in
compliance with Rule 462(b) by 10:00 P.M., Washington, D.C. time, on
the date of this Agreement, and the Company shall at the time of filing
either pay to the Commission the filing fee for the Rule 462(b)
Registration Statement or give irrevocable instructions for the payment
of such fee pursuant to Rule 111(b) under the Act.
6. The Company covenants and agrees with the several Underwriters
that the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Shares under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or
8
producing any Agreement among Underwriters, this Agreement, the Blue Sky
Memorandum, closing documents (including any compilations thereof) and any other
documents in connection with the offering, purchase, sale and delivery of the
Shares; (iii) all expenses in connection with the qualification of the Shares
for offering and sale under state securities laws as provided in Section 5(b)
hereof, including the fees and disbursements of counsel for the Underwriters in
connection with such qualification and in connection with the Blue Sky survey
(iv) all fees and expenses in connection with listing the Shares on the
Exchange; (v) the filing fees incident to, and the reasonable fees and
disbursements of counsel for the Underwriters in connection with, securing any
required review by the National Association of Securities Dealers, Inc. of the
terms of the sale of the Shares; (vi) the cost of preparing stock certificates;
(vii) the cost and charges of any transfer agent or registrar; and (viii) all
other costs and expenses incident to the performance of its obligations
hereunder which are not otherwise specifically provided for in this Section. It
is understood, however, that, except as provided in this Section, and Sections 8
and 11 hereof, the Underwriters will pay all of their own costs and expenses,
including the fees of their counsel, stock transfer taxes on resale of any of
the Shares by them, and any advertising expenses connected with any offers they
may make.
7. The obligations of the Underwriters hereunder, as to the Shares
to be delivered at each Time of Delivery, shall be subject, in their discretion,
to the condition that all representations and warranties and other statements of
the Company and ▇▇▇▇ ▇▇▇ herein are, at and as of such Time of Delivery, true
and correct, the condition that the Company and ▇▇▇▇ ▇▇▇ shall have performed
all of their obligations hereunder theretofore to be performed, and the
following additional conditions:
(a) The Prospectus shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed
for such filing by the rules and regulations under the Act and in
accordance with Section 5(a) hereof; if the Company has elected to rely
upon Rule 462(b), the Rule 462(b) Registration Statement shall have
become effective by 10:00 P.M., Washington, D.C. time, on the date of
this Agreement; no stop order suspending the effectiveness of the
Registration Statement or any part thereof shall have been issued and
no proceeding for that purpose shall have been initiated or threatened
by the Commission; and all requests for additional information on the
part of the Commission shall have been complied with to your reasonable
satisfaction;
(b) ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, counsel for the Underwriters, shall have
furnished to you such written opinion or opinions (a draft of each such
opinion is attached as Annex II(a) hereto), dated such Time of
Delivery, with respect to such matters as you may reasonably request,
and such counsel shall have received such papers and information as
they may reasonably request to enable them to pass upon such matters;
(c) Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ (Illinois), special
counsel for the Company and ▇▇▇▇ ▇▇▇, shall have furnished to you their
written opinion (a draft of such opinion is attached as Annex II(b)
hereto), dated such Time of Delivery, in form and substance
satisfactory to you, to the effect that:
(i) Each of the Intercompany Agreements constitutes the
valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms under the
laws of the State of Illinois, except as (a) enforcement may
be limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other similar laws affecting
creditors' rights generally and by general principles of
equity (regardless of whether enforcement is sought in equity
or at law) and (b) any rights
9
of indemnification or contribution under the Intercompany
Agreements may be limited by the public policy underlying
any law, rule or regulation;
(ii) Neither the execution, delivery or performance by the
Company and ▇▇▇▇ ▇▇▇ of this Agreement nor the compliance by
the Company or ▇▇▇▇ ▇▇▇ with the terms and provisions hereof,
including the issuance and sale of the Shares, and neither the
execution, delivery or performance by the Company of each of
the Intercompany Agreements nor the compliance by the Company
with the terms and provisions thereof will contravene any
provision of Applicable Law of the State of New York, with
respect to this Agreement, or the State of Illinois, with
respect to the Intercompany Agreements, or any Applicable Law
of the United States of America;
(iii) No Governmental Approval, which has not been obtained
or taken and is not in full force and effect, is required to
authorize, or is required in connection with, (1) the
execution, delivery or enforceability of this Agreement or any
of the Intercompany Agreements by the Company or by ▇▇▇▇ ▇▇▇
and (2) the consummation by the Company or ▇▇▇▇ ▇▇▇ of the
transactions contemplated by this Agreement, including the
issuance and sale of the Shares;
(iv) The execution and delivery by the Company of this
Agreement and each of the Intercompany Agreements and the
performance by the Company of its obligations under this
Agreement and each of the Intercompany Agreements, each in
accordance with its terms, do not constitute a violation of,
or a default under, any Applicable Contract (in giving the
opinion in this subsection (iv), such counsel need not express
any opinion as to whether the execution, delivery or
performance by the Company of this Agreement or the
Intercompany Agreements will constitute a violation of, or a
default under, any covenant, restriction or provision with
respect to financial ratios or tests or any aspect of the
financial condition or results of operations of the Company or
express an opinion as to the effect of laws other than those
as to which such counsel is rendering an opinion);
(v) The execution and delivery by ▇▇▇▇ ▇▇▇ of this
Agreement and each of the Intercompany Agreements and the
performance by ▇▇▇▇ ▇▇▇ of its obligations under this
Agreement and each of the Intercompany Agreements, each in
accordance with its terms, do not constitute a violation of,
or a default under, any Applicable Contract (in giving the
opinion in this subsection (v), such counsel need not express
any opinion as to whether the execution, delivery or
performance by the Company of this Agreement or the
Intercompany Agreements will constitute a violation of, or a
default under, any covenant, restriction or provision with
respect to financial ratios or tests or any aspect of the
financial condition or results of operations of the Company or
express an opinion as to the effect of laws other than those
as to which such counsel is rendering an opinion);
(vi) Neither the execution, delivery or performance by the
Company of its obligations under this Agreement or the
Intercompany Agreements nor compliance by the Company with the
terms hereof or thereof will contravene any Applicable Order
against the Company;
10
(vii) Neither the execution, delivery or performance by
▇▇▇▇ ▇▇▇ of its obligations under this Agreement or the
Intercompany Agreements nor compliance by ▇▇▇▇ ▇▇▇ with the
terms hereof or thereof will contravene any Applicable Order
against ▇▇▇▇ ▇▇▇;
(viii)The statements set forth in the Prospectus under the
captions "Certain Relationships and Related Transactions" and
"Underwriting", insofar as such statements constitute
summaries of legal matters or certain provisions of the
documents referred to therein, are true and correct in all
material respects;
(ix) The Company is not, and, upon the consummation of the
transactions contemplated by this Agreement, will not be an
"investment company" under the Investment Company Act of 1940,
as amended; and
(x) The Registration Statement, as of its effective date,
and the Prospectus, as of its date, appeared on their face to
be appropriately responsive in all material respects to the
requirements of the Act and the rules and regulations
promulgated thereunder, except that, in each case, we express
no opinion as to the financial statements, schedules and other
financial data included therein or excluded therefrom or the
exhibits to the Registration Statement and, except to the
extent expressly stated in the opinion in subsection (viii) of
this Section 7(c), we do not assume any responsibility for the
accuracy, completeness or fairness of the statements contained
in the Registration Statement or the Prospectus. In addition,
we have participated in conferences with officers and other
representatives of the Company and ▇▇▇▇ ▇▇▇, representatives
of the independent public accountants of the Company, you and
your counsel at which the contents of the Registration
Statement and the Prospectus and related matters were
discussed and, although we are not passing upon, and do not
assume any responsibility for, the accuracy, completeness or
fairness of the statements contained in the Registration
Statement or the Prospectus and have made no independent check
or verification thereof (except to the extent expressly stated
in the opinion in subsection (viii) of this Section 7(c)), on
the basis of the foregoing, no facts have come to our
attention that have led us to believe that the Registration
Statement, at the time it became effective, contained an
untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to
make the statements therein not misleading or that the
Prospectus, as of its date and the date hereof, contained or
contains an untrue statement of a material fact or omitted or
omits to state a material fact necessary to make the
statements therein, in light of the circumstances under which
they were made, not misleading, except that we express no
opinion or belief with respect to the financial statements,
schedules and other financial information included therein or
excluded therefrom or the exhibits to the Registration
Statement.
As used in this Subsection 7(c), Subsection 7(e) and Subsection 7(f)
below, (1) the term "Applicable Laws" shall mean those laws, rules and
regulations which, in such counsel's experience, are normally applicable to
transactions of the type contemplated by this Agreement (other than the United
States federal securities laws, state and foreign securities or Blue Sky laws,
antifraud laws and the rules and regulations of the National Association of
Securities Dealers, Inc.) and the Intercompany Agreements, which are not the
subject of a
11
specific opinion herein referring expressly to a particular law or laws; (2) the
term "Governmental Authorities" shall mean any court, regulatory body,
administrative agency, or governmental body having jurisdiction over the Company
or ▇▇▇▇ ▇▇▇ (with respect to the Company) under Applicable Laws; (3) the term
"Governmental Approval" shall mean any consent, approval, license, authorization
or validation of, or filing, recording or registration with, any Governmental
Authorities required to be made or obtained by the Company under Applicable
Laws, other than any consent, approval, license, authorization, validation,
filing, recording or registration which may have become applicable because of
your legal or regulatory status; (4) the term "Applicable Orders" shall mean
orders or decrees of any Governmental Authorities identified on a schedule to a
certificate of the Company, with respect to Applicable Orders against the
Company, and identified on a schedule to a certificate of ▇▇▇▇ ▇▇▇, with respect
to Applicable Orders against ▇▇▇▇ ▇▇▇; and (5) the term "Applicable Contracts"
shall mean those agreements or instruments filed by the Company as exhibits to
the Registration Statement or as otherwise requested by the Representative to be
specified on a schedule to the written opinion;
In rendering such opinion, such counsel may state that as to matters of
New York law, counsel relies on the opinion of Skadden, Arps, Slate, ▇▇▇▇▇▇▇ &
▇▇▇▇, LLP.
(d) ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ & Ingersoll, LLP, special counsel for the
Company, shall have furnished to you their written opinion (a draft of such
opinion is attached hereto as Annex II (c) hereto), dated such Time of Delivery,
in form and substance satisfactory to you, to the effect that:
(i) The Company is duly incorporated and is validly existing
under the laws of the State of Maryland and is in good standing with
the State Department of Assessments and Taxation of Maryland;
(ii) The Company has full corporate power to own its properties
and to conduct its business as described in the Prospectus;
(iii) The authorized, issued and outstanding stock of the Company
is as disclosed in the Prospectus under the caption "Capitalization"
and the authorized stock of the Company conforms as to legal matters
to the description thereof in the Prospectus under the heading
"Description of Capital Stock." All of the shares of Stock issued
and outstanding immediately prior to the issuance of the Shares have
been duly authorized and are validly issued, fully paid and
nonassessable;
(iv) The Shares have been duly authorized for issuance and sale
to the Underwriters and, when issued and paid for in accordance with
the terms of this Agreement, will be validly issued, fully paid and
nonassessable;
(v) This Agreement and each of the Intercompany Agreements have
been duly authorized, executed and delivered by the Company;
(vi) The execution and delivery of this Agreement and the
Intercompany Agreements by the Company and the consummation by the
Company of the transactions contemplated therein, including the
issuance and sale of the Shares, will not result in a violation of
the Charter or the By-laws of the Company; and
(vii) The execution and delivery of this Agreement and the
Intercompany Agreements by ▇▇▇▇ ▇▇▇ and the consummation by ▇▇▇▇ ▇▇▇
of the transactions
12
contemplated therein will not result in a violation of the Charter
or the By-laws of ▇▇▇▇ ▇▇▇;
(e) ▇▇▇▇▇▇ ▇▇▇▇▇▇, Senior Vice President, General Counsel and
Secretary of the Company, shall have furnished to you her written opinion (a
draft of such opinion is attached as Annex II (d) hereto), dated such Time of
Delivery, in form and substance satisfactory to you, to the effect that:
(i) The Company has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
under the laws of each jurisdiction in which it owns or leases
properties or conducts any business so as to require such
qualification, except to the extent that such failure to qualify
would not have a Material Adverse Effect (such counsel being
entitled to rely upon certificates of state officials or in respect
to matters of fact upon certificates of officers of the Company,
provided that such counsel shall state that they believe that both
you and they are justified in relying upon such certificates);
(ii) Each United States subsidiary of the Company has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of its jurisdiction of incorporation; and
all of the issued shares of capital stock of each such subsidiary
have been duly and validly authorized and issued, are fully paid and
non-assessable, (except for directors' qualifying shares) are owned
directly or indirectly by the Company and, to such counsel's
knowledge, free and clear of all liens, encumbrances, equities or
claims (such counsel being entitled to rely in respect to matters of
fact upon certificates of officers of the Company or its
subsidiaries, provided that such counsel shall state that they
believe that both you and they are justified in relying upon such
certificates);
(iii) The issue and sale of the Shares being delivered at such
Time of Delivery by the Company and the compliance by the Company
with all of the provisions of this Agreement and the consummation of
the transactions herein and therein contemplated and the performance
by the Company of its respective obligations under the Intercompany
Agreements will not conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute a default under,
any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument known to such counsel to which the Company
or any of its subsidiaries is a party or by which the Company or any
of its subsidiaries is bound or to which any of the property or
assets of the Company or any of its subsidiaries is subject, nor
will such action result in any violation of the provisions of any
Applicable Law or Applicable Order, except in each case for such
conflicts, breaches, violations or defaults that would not have a
Material Adverse Effect;
(iv) Neither the Company nor any of its subsidiaries is in
violation of its Articles of Incorporation or By-laws or, to the
best of such counsel's knowledge, in default in the performance or
observance of any obligation, agreement, covenant or condition
contained in any indenture, mortgage, deed of trust, loan agreement,
lease or other agreement or instrument to which it is a party or by
which it or any of its properties may be bound, except for such
defaults which would not have a Material Adverse Effect;
13
(v) Any real property, buildings, stores or other premises held
under lease by the Company and its subsidiaries are held by them
under valid, subsisting and enforceable leases, with such exceptions
(other than with respect to the leases set forth on a schedule to
such counsel's opinion) as would not have a Material Adverse Effect;
and the issue and sale of the Shares being delivered at the Time of
Delivery by the Company and the compliance by the Company with all
of the provisions of this Agreement and the consummation of the
transactions herein and therein contemplated and the performance by
the Company and ▇▇▇▇ ▇▇▇ of their respective obligations under the
lntercompany Agreements will not conflict with or result in a breach
or violation of any of the terms or provisions of, or constitute a
default under, any lease to which the Company or any of its
subsidiaries is a party or by which the Company or any of its
subsidiaries or any of their respective properties may be bound,
except in each case (other than with respect to the leases set forth
on a schedule to such counsel's opinion) for such conflicts,
breaches, violations or defaults that would not have a Material
Adverse Effect; and
(vi) To such counsel's knowledge, there are no legal or
governmental proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property of the Company or
any of its subsidiaries is the subject that are required to be
described in the Prospectus which are not so described; and, to such
counsel's knowledge, no such proceedings are threatened or
contemplated by Governmental Authorities or threatened by others;
(f) R. ▇▇▇▇▇ ▇▇▇▇▇▇▇, Vice President, General Counsel and Assistant
Secretary of ▇▇▇▇ ▇▇▇, shall have furnished to you his written opinion (a draft
of such opinion is attached as Annex II(e) hereto), dated such Time of Delivery,
in form and substance satisfactory to you, to the effect that:
(i) Each of the Intercompany Agreements constitutes the valid
and binding obligation of ▇▇▇▇ ▇▇▇, enforceable against ▇▇▇▇ ▇▇▇ in
accordance with its terms under the laws of the State of Illinois,
except as (a) enforcement may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other similar laws
affecting creditors' rights generally and by general principles of
equity (regardless of whether enforcement is sought in equity or at
law) and (b) any rights of indemnification or contribution under the
Intercompany Agreements may be limited by the public policy
underlying any law, rule or regulation; and
(ii) The execution, delivery and enforceability of this
Agreement by ▇▇▇▇ ▇▇▇, the compliance by ▇▇▇▇ ▇▇▇ with the terms and
provisions hereof and the consummation of the transactions
contemplated by this Agreement and the execution, delivery and
enforceability of each of the Intercompany Agreements by ▇▇▇▇ ▇▇▇ or
the compliance by ▇▇▇▇ ▇▇▇ with the terms and provisions thereof
will not (1) violate or conflict with, or result in any
contravention of, any Applicable Law of the State of New York, with
respect to this Agreement, or the State of Illinois, with respect to
the Intercompany Agreements, or any Applicable Law of the United
States, or (2) conflict with or result in a breach or violation of
any of the terms or provisions of, or constitute a default under,
any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument known to such counsel to which ▇▇▇▇ ▇▇▇ or
any of its subsidiaries is a party or by which ▇▇▇▇ ▇▇▇ or any of
its
14
subsidiaries is bound or to which any of the property or assets of
▇▇▇▇ ▇▇▇ or any of its subsidiaries is subject, except in each case
for such violations, conflicts, breaches and defaults as would not
have a Material Adverse Effect;
(g) Foreign counsel reasonably satisfactory to the Representatives
shall have furnished to you opinions, dated such Time of Delivery, in form and
substance satisfactory to you, to the effect that the Company's foreign
subsidiaries are in good standing under the laws of their jurisdiction of
incorporation, and, following their transfer from ▇▇▇▇ ▇▇▇ to the Company, will
be owned directly or indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims (such counsel being entitled to rely in respect
to matters of fact upon certificates of officers of the Company or its
subsidiaries, provided that such counsel shall state that they believe that both
you and they are justified in relying upon such certificates);
(h) On the date of the Prospectus at a time prior to the execution of
this Agreement, at 9:30 a.m., New York City time, on the effective date of any
post-effective amendment to the Registration Statement filed subsequent to the
date of this Agreement and also at each Time of Delivery, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ shall
have furnished to you a letter or letters, dated the respective dates of
delivery thereof, in form and substance satisfactory to you, to the effect set
forth in Annex I hereto (the executed copy of the letter delivered prior to the
execution of this Agreement is attached as Annex I(a) hereto and a draft of the
form of letter to be delivered on the effective date of any post-effective
amendment to the Registration Statement and as of each Time of Delivery is
attached as Annex I(b) hereto);
(i) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements included in
the Prospectus any material loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or from
any labor dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus, and (ii) since the
respective dates as of which information is given in the Prospectus there shall
not have been any change in the capital stock of the Company or any of its
subsidiaries or long-term debt of the Company or any of its subsidiaries of more
than ten percent (10%) from the long-term debt shown on the most recent balance
sheet included in the Registration Statement (but not including any debt assumed
by the Company in connection with its separation from ▇▇▇▇ ▇▇▇), or any change,
or any development involving a prospective change, in or affecting the general
affairs, management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries taken as a whole, in each case,
otherwise than as set forth or contemplated in the Prospectus, the effect of
which, in any such case described in clause (i) or (ii), is in the judgment of
the Representatives so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the Shares
being delivered at such Time of Delivery on the terms and in the manner
contemplated in the Prospectus;
(j) On or after the date hereof there shall not have occurred any of
the following: (i) a suspension or material limitation in trading in securities
generally on the New York Stock Exchange; (ii) a suspension or material
limitation in trading in the Company's securities on the New York Stock
Exchange; (iii) a general moratorium on commercial banking activities declared
by either Federal or New York or Illinois State authorities; or (iv) the
outbreak or escalation of hostilities involving the United States or the
declaration by the United States of a national emergency or war, if the effect
of any such event specified in this clause (iv) in the
15
judgment of the Representatives makes it impracticable or inadvisable to proceed
with the public offering or the delivery of the Shares being delivered at such
Time of Delivery on the terms and in the manner contemplated in the Prospectus;
(k) The Shares to be sold at such Time of Delivery shall have been
duly listed, subject to notice of issuance, on the Exchange;
(l) The Company has obtained and delivered to the Underwriters
executed copies of an agreement from ▇▇▇▇ ▇▇▇ and each executive officer and
director of the Company, all of whom are listed on Annex III hereto,
substantially to the effect set forth in Subsection 5(e) hereof in form and
substance satisfactory to you;
(m) The Company shall have complied with the provisions of
Section 5(c) hereof with respect to the furnishing of prospectuses on the New
York Business Day next succeeding the date of this Agreement; and
(n) The Company shall have furnished or caused to be furnished to you
at such Time of Delivery certificates of officers of the Company and ▇▇▇▇ ▇▇▇
satisfactory to you as to the accuracy of the representations and warranties of
the Company and ▇▇▇▇ ▇▇▇ herein at and as of such Time of Delivery, as to the
performance by the Company and ▇▇▇▇ ▇▇▇ of all of its obligations hereunder to
be performed at or prior to such Time of Delivery, as to the matters set forth
in subsections (a) and (e) of this Section and as to such other matters as you
may reasonably request.
8. (a) The Company and ▇▇▇▇ ▇▇▇, jointly and severally, will
indemnify and hold harmless each Underwriter against any losses, claims, damages
or liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement or the Prospectus, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in the case
of a Registration Statement or an amendment thereto, or the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, in the case of the Prospectus or any
amendment or supplement thereto, and will reimburse each Underwriter for any
legal or other expenses reasonably incurred by such Underwriter in connection
with investigating or defending any such action or claim as such expenses are
incurred; PROVIDED, HOWEVER, that the Company and ▇▇▇▇ ▇▇▇ shall not be liable
in any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in any Preliminary Prospectus, the
Registration Statement or the Prospectus or any such amendment or supplement in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter through ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. expressly for use
therein.
(b) Each Underwriter will indemnify and hold harmless the Company and
▇▇▇▇ ▇▇▇ against any losses, claims, damages or liabilities to which the Company
and ▇▇▇▇ ▇▇▇ may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, the Registration
Statement or the Prospectus, or any amendment or supplement thereto, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
16
statements therein not misleading, in the case of a Registration Statement or an
amendment thereto, or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, in the case of the Prospectus or any amendment or supplement
thereto, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in any Preliminary Prospectus, the Registration Statement or the Prospectus or
any such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company or ▇▇▇▇ ▇▇▇ by such Underwriter through
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. expressly for use therein; and will reimburse the Company
and ▇▇▇▇ ▇▇▇ for any legal or other expenses reasonably incurred by the Company
or ▇▇▇▇ ▇▇▇ in connection with investigating or defending any such action or
claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party (who
shall not, except with the consent of the indemnified party, be counsel to the
indemnifying party), and, after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party under such
subsection for any legal expenses of other counsel or any other expenses, in
each case subsequently incurred by such indemnified party, in connection with
the defense thereof other than reasonable costs of investigation. No
indemnifying party shall, without the written consent of the indemnified party,
effect the settlement or compromise of, or consent to the entry of any judgment
with respect to, any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified party is an actual or potential party to such action or claim)
unless such settlement, compromise or judgment (i) includes an unconditional
release of the indemnified party from all liability arising out of such action
or claim and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities
(or actions in respect thereof) in such proportion as is appropriate to
reflect the relative benefits received by the Company and ▇▇▇▇ ▇▇▇ on the one
hand and the Underwriters on the other from the offering of the Shares. If,
however, the allocation provided by the immediately preceding sentence is not
permitted by applicable law or if the indemnified party failed to give the
notice required under subsection (c) above, then each indemnifying party
shall contribute to such amount paid or payable by such indemnified party in
such proportion as is appropriate to reflect not only such relative benefits
but also the relative fault of the Company and ▇▇▇▇ ▇▇▇ on the one hand and
the Underwriters on the other in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities (or actions in
respect thereof), as well as any other relevant equitable considerations. The
relative benefits received by the Company and ▇▇▇▇ ▇▇▇
17
on the one hand and the Underwriters on the other shall be deemed to be in
the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Company and ▇▇▇▇ ▇▇▇ bear to the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth in the table on the cover page of the Prospectus. The
relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company and ▇▇▇▇ ▇▇▇ on the one hand or the Underwriters on
the other and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The
Company, ▇▇▇▇ ▇▇▇ and the Underwriters agree that it would not be just and
equitable if contributions pursuant to this subsection (d) were determined by
PRO RATA allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take
account of the equitable considerations referred to above in this subsection
(d). The amount paid or payable by an indemnified party as a result of the
losses, claims, damages or liabilities (or actions in respect thereof)
referred to above in this subsection (d) shall be deemed to include any legal
or other expenses reasonably incurred by such indemnified party in connection
with investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), 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 which 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 Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations in this
subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) The obligations of the Company and ▇▇▇▇ ▇▇▇ under this Section 8
shall be in addition to any liability which the Company and ▇▇▇▇ ▇▇▇ may
otherwise have and shall extend, upon the same terms and conditions, to each
person, if any, who controls any Underwriter within the meaning of the Act; and
the obligations of the Underwriters under this Section 8 shall be in addition to
any liability which the respective Underwriters may otherwise have and shall
extend, upon the same terms and conditions, to each officer and director of the
Company (including any person who, with his or her consent, is named in the
Registration Statement as about to become a director of the Company) or ▇▇▇▇ ▇▇▇
and to each person, if any, who controls the Company or ▇▇▇▇ ▇▇▇ within the
meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to
purchase the Shares which it has agreed to purchase hereunder at a Time of
Delivery, you may in your discretion arrange for you or another party or other
parties to purchase such Shares on the terms contained herein. If within
thirty-six hours after such default by any Underwriter you do not arrange for
the purchase of such Shares, then the Company shall be entitled to a further
period of thirty-six hours within which to procure another party or other
parties satisfactory to you to purchase such Shares on such terms. In the event
that, within the respective prescribed periods, you notify the Company that you
have so arranged for the purchase of such Shares, or the Company notifies you
that it has so arranged for the purchase of such Shares, you or the Company
shall have the right to postpone such Time of Delivery for a period of not more
than seven days, in order to effect whatever changes may thereby be made
necessary in the Registration Statement or the Prospectus, or in any other
documents or arrangements, and the Company agrees to file promptly any
amendments to the Registration Statement or the Prospectus which in your opinion
may thereby be made necessary. The term "Underwriter" as used in this Agreement
shall include any person substituted under this Section with
18
like effect as if such person had originally been a party to this Agreement with
respect to such Shares.
(b) If, after giving effect to any arrangements for the purchase of
the Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased does not exceed one-eleventh of the aggregate number of all
the Shares to be purchased at such Time of Delivery, then the Company shall have
the right to require each non-defaulting Underwriter to purchase the number of
shares which such Underwriter agreed to purchase hereunder at such Time of
Delivery and, in addition, to require each non-defaulting Underwriter to
purchase its pro rata share (based on the number of Shares which such
Underwriter agreed to purchase hereunder) of the Shares of such defaulting
Underwriter or Underwriters for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
(c) If, after giving effect to any arrangements for the purchase of
the Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased exceeds one-eleventh of the aggregate number of all the
Shares to be purchased at such Time of Delivery, or if the Company shall not
exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Shares of a defaulting Underwriter or Underwriters,
then this Agreement (or, with respect to the Second Time of Delivery, the
obligations of the Underwriters to purchase and of the Company to sell the
Optional Shares) shall thereupon terminate, without liability on the part of any
non-defaulting Underwriter or the Company, except for the expenses to be borne
by the Company and the Underwriters as provided in Section 6 hereof and the
indemnity and contribution agreements in Section 8 hereof; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations,
warranties and other statements of the Company, ▇▇▇▇ ▇▇▇ and the several
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and effect,
regardless of any investigation (or any statement as to the results thereof)
made by or on behalf of any Underwriter or any controlling person of any
Underwriter, or the Company or ▇▇▇▇ ▇▇▇, or any officer or director or
controlling person of the Company or ▇▇▇▇ ▇▇▇, and shall survive delivery of and
payment for the Shares.
11. If this Agreement shall be terminated pursuant to Section 9
hereof, the Company shall not then be under any liability to any Underwriter
except as provided in Sections 6 and 8 hereof; but, if for any other reason, any
Shares are not delivered by or on behalf of the Company as provided herein, the
Company will reimburse the Underwriters through you for all out-of-pocket
expenses approved in writing by you, including fees and disbursements of
counsel, reasonably incurred by the Underwriters in making preparations for the
purchase, sale and delivery of the Shares not so delivered, but the Company
shall then be under no further liability to any Underwriter except as provided
in Sections 6 and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by you jointly or by ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. on behalf of you as the
representatives.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to you as the representatives in care of ▇▇▇▇▇▇▇, Sachs &
Co., ▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
19
10005, Attention: Registration Department; if to the Company shall be delivered
or sent by mail to the address of the Company set forth in the Registration
Statement, Attention: Secretary; and if to ▇▇▇▇ ▇▇▇ shall be delivered or sent
by mail to Three First National Plaza, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: R. ▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq., provided, however, that any notice to an
Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by mail,
telex or facsimile transmission to such Underwriter at its address set forth in
its Underwriters' Questionnaire, or telex constituting such Questionnaire, which
address will be supplied to the Company by you upon request. Any such
statements, requests, notices or agreements shall take effect upon receipt
thereof.
13. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, the Company, ▇▇▇▇ ▇▇▇ and, to the extent provided
in Sections 8 and 10 hereof, the officers and directors of the Company and ▇▇▇▇
▇▇▇ and each person who controls the Company and ▇▇▇▇ ▇▇▇ or any Underwriter,
and their respective heirs, executors, administrators, successors and assigns,
and no other person shall acquire or have any right under or by virtue of this
Agreement. No purchaser of any of the Shares from any Underwriter shall be
deemed a successor or assign by reason merely of such purchase.
14. Time shall be of the essence of this Agreement. As used herein,
the term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.
16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
instrument.
20
If the foregoing is in accordance with your understanding, please sign
and return to us seven counterparts hereof, and upon the acceptance hereof by
you, on behalf of each of the Underwriters, this letter and such acceptance
hereof shall constitute a binding agreement between each of the Underwriters,
the Company and ▇▇▇▇ ▇▇▇. It is understood that your acceptance of this letter
on behalf of each of the Underwriters is pursuant to the authority set forth in
a form of Agreement among Underwriters, the form of which shall be submitted to
the Company and ▇▇▇▇ ▇▇▇ for examination upon request, but without warranty on
your part as to the authority of the signers thereof.
Very truly yours,
COACH, INC.
By: _______________________________
Name: _______________________
Title: _______________________
▇▇▇▇ ▇▇▇ CORPORATION
By: _______________________________
Name: ________________________
Title: _______________________
ACCEPTED AS OF THE DATE HEREOF:
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
Prudential Securities Incorporated
By: ______________________________
(▇▇▇▇▇▇▇, Sachs & Co.)
On behalf of each of the Underwriters
21
SCHEDULE I
NUMBER OF OPTIONAL
SHARES TO BE
TOTAL NUMBER OF PURCHASED IF
FIRM SHARES MAXIMUM OPTION
UNDERWRITER TO BE PURCHASED EXERCISED
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co...............................................
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated.................................
Prudential Securities Incorporated................................
[NAMES OF OTHER UNDERWRITERS TO BE PROVIDED BY GS&CO.]............
--------------- -----------------
Total..............................................
=============== =================
22
ANNEX I
FORM OF COMFORT LETTER OF
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP
Pursuant to Section 7(d) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with
respect to the Company and its subsidiaries within the meaning of the
Act and the applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules (and, if applicable,
financial forecasts and/or pro forma financial information) examined by
them and included in the Prospectus or the Registration Statement
comply as to form in all material respects with the applicable
accounting requirements of the Act and the related published rules and
regulations thereunder; and, if applicable, they have made a review in
accordance with standards established by the American Institute of
Certified Public Accountants of the unaudited consolidated interim
financial statements, selected financial data, pro forma financial
information, financial forecasts and/or condensed financial statements
derived from audited financial statements of the Company for the
periods specified in such letter, as indicated in their reports
thereon, copies of which have been furnished separately to the
representatives of the Underwriters (the "Representatives") and are
attached hereto;
(iii) They have made a review in accordance with standards
established by the American Institute of Certified Public Accountants
of the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included in the Prospectus as indicated in their reports thereon copies
of which have been separately furnished to the Representatives and are
attached hereto and on the basis of specified procedures including
inquiries of officials of the Company who have responsibility for
financial and accounting matters regarding whether the unaudited
condensed consolidated financial statements referred to in paragraph
(vi)(A)(i) below comply as to form in all material respects with the
applicable accounting requirements of the Act and the related published
rules and regulations, nothing came to their attention that cause them
to believe that the unaudited condensed consolidated financial
statements do not comply as to form in all material respects with the
applicable accounting requirements of the Act and the related published
rules and regulations;
(iv) The unaudited selected financial information with respect
to the consolidated results of operations and financial position of the
Company for the five most recent fiscal years included in the
Prospectus agrees with the corresponding amounts (after restatements
where applicable) in the audited consolidated financial statements for
such five fiscal years which were included or incorporated by reference
in the Company's Annual Reports on Form 10-K for such fiscal years;
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K
and on the basis of limited procedures specified in such letter nothing
came to their attention as a result of the foregoing procedures that
caused them to believe that this information does not conform in all
material respects
with the disclosure requirements of Items 301, 302, 402 and 503(d),
respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available
interim financial statements of the Company and its subsidiaries,
inspection of the minute books of the Company and its subsidiaries
since the date of the latest audited financial statements included in
the Prospectus, inquiries of officials of the Company and its
subsidiaries responsible for financial and accounting matters and such
other inquiries and procedures as may be specified in such letter,
nothing came to their attention that caused them to believe that:
(A) (i) the unaudited consolidated statements of
income, consolidated balance sheets and consolidated
statements of cash flows included in the Prospectus do not
comply as to form in all material respects with the
applicable accounting requirements of the Act and the
related published rules and regulations, or (ii) any
material modifications should be made to the unaudited
condensed consolidated statements of income, consolidated
balance sheets and consolidated statements of cash flows
included in the Prospectus for them to be in conformity
with generally accepted accounting principles;
(B) any other unaudited income statement data and
balance sheet items included in the Prospectus do not agree
with the corresponding items in the unaudited consolidated
financial statements from which such data and items were
derived, and any such unaudited data and items were not
determined on a basis substantially consistent with the
basis for the corresponding amounts in the audited
consolidated financial statements included in the
Prospectus;
(C) the unaudited financial statements which were not
included in the Prospectus but from which were derived any
unaudited condensed financial statements referred to in
clause (A) and any unaudited income statement data and
balance sheet items included in the Prospectus and referred
to in clause (B) were not determined on a basis
substantially consistent with the basis for the audited
consolidated financial statements included in the
Prospectus;
(D) any unaudited pro forma consolidated condensed
financial statements included in the Prospectus do not
comply as to form in all material respects with the
applicable accounting requirements of the Act and the
published rules and regulations thereunder or the pro forma
adjustments have not been properly applied to the
historical amounts in the compilation of those statements;
(E) as of a specified date not more than five days
prior to the date of such letter, there have been any
changes in the consolidated capital stock (other than
issuances of capital stock upon exercise of options and
stock appreciation rights, upon earn-outs of performance
shares and upon conversions of convertible securities, in
each case which were outstanding on the date of the latest
financial statements included in the Prospectus) or any
increase in the consolidated long-term debt of the Company
and its subsidiaries, or any decreases in consolidated net
current assets or stockholders' equity or other items
specified by
I-2
the Representatives, or any increases in any items
specified by the Representatives, in each case as compared
with amounts shown in the latest balance sheet included in
the Prospectus, except in each case for changes, increases
or decreases which the Prospectus discloses have occurred
or may occur or which are described in such letter; and
(F) for the period from the date of the latest
financial statements included in the Prospectus to the
specified date referred to in clause (E) there were any
decreases in consolidated net revenues or operating profit
or the total or per share amounts of consolidated net
income or other items specified by the Representatives, or
any increases in any items specified by the
Representatives, in each case as compared with the
comparable period of the preceding year and with any other
period of corresponding length specified by the
Representatives, except in each case for decreases or
increases which the Prospectus discloses have occurred or
may occur or which are described in such letter; and
(vii) In addition to the examination referred to in their
report(s) included in the Prospectus and the limited procedures,
inspection of minute books, inquiries and other procedures referred to
in paragraphs (iii) and (vi) above, they have carried out certain
specified procedures, not constituting an examination in accordance
with generally accepted auditing standards, with respect to certain
amounts, percentages and financial information specified by the
Representatives, which are derived from the general accounting records
of the Company and its subsidiaries, which appear in the Prospectus, or
in Part II of, or in exhibits and schedules to, the Registration
Statement specified by the Representatives, and have compared certain
of such amounts, percentages and financial information with the
accounting records of the Company and its subsidiaries and have found
them to be in agreement.
ANNEX II(a)
FORM OF OPINION OF
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇
ANNEX II(b)
FORM OF OPINION OF
SKADDEN, ARPS, SLATE, ▇▇▇▇▇▇▇ & ▇▇▇▇ (ILLINOIS)
ANNEX II(c)
FORM OF OPINION OF
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, LLP
ANNEX II(d)
FORM OF OPINION OF
▇▇▇▇▇▇ ▇▇▇▇▇▇
ANNEX II(e)
FORM OF OPINION OF
R. ▇▇▇▇▇ ▇▇▇▇▇▇▇
ANNEX III
EXECUTIVE OFFICERS AND DIRECTORS
1. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
2. ▇▇▇ ▇▇▇▇▇▇▇▇▇
3. ▇▇▇▇ ▇▇▇▇
4. ▇▇▇▇ ▇▇▇▇▇▇▇
5. ▇▇▇▇▇ ▇▇▇▇▇
6. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
7. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
8. ▇▇▇▇▇▇ ▇▇▇▇▇▇
9. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇