Exhibit 1.1
SIERRA PACIFIC RESOURCES
(a Nevada corporation)
19,000,000 Shares of Common Stock
PURCHASE AGREEMENT
Dated: August __, 2001
TABLE OF CONTENTS
SECTION PAGE
1. REPRESENTATIONS AND WARRANTIES...........................................................................2
(a) REPRESENTATIONS AND WARRANTIES BY THE COMPANY...................................................2
(i) Compliance with Registration Requirements..............................................3
(ii) Incorporated Documents.................................................................3
(iii) Independent Accountants................................................................3
(iv) Financial Statements...................................................................4
(v) No Material Adverse Change in Business.................................................4
(vi) Good Standing of the Company...........................................................4
(vii) Good Standing of Subsidiaries..........................................................5
(viii) Capitalization.........................................................................5
(ix) Authorization of Agreement.............................................................5
(x) Authorization and Description of Securities............................................5
(xi) Absence of Defaults and Conflicts......................................................5
(xii) Absence of Proceedings.................................................................6
(xiii) Accuracy of Exhibits...................................................................6
(xiv) Absence of Further Requirements........................................................6
(xv) Possession of Licenses and Permits.....................................................6
(xvi) Title to Property......................................................................7
(xvii) Investment Company Act.................................................................7
(xviii) Holding Company Act....................................................................7
(b) OFFICER'S CERTIFICATES..........................................................................7
2. SALE AND DELIVERY TO UNDERWRITERS; CLOSING...............................................................7
(a) INITIAL SECURITIES..............................................................................7
(b) OPTION SECURITIES...............................................................................8
(c) PAYMENT.........................................................................................8
(d) DENOMINATIONS; REGISTRATION.....................................................................9
3. COVENANTS OF THE COMPANY.................................................................................9
(a) COMPLIANCE WITH SECURITIES REGULATIONS AND COMMISSION REQUESTS..................................9
(b) FILING OF AMENDMENTS............................................................................9
(c) DELIVERY OF REGISTRATION STATEMENTS............................................................10
(d) DELIVERY OF PROSPECTUSES.......................................................................10
(e) Continued Compliance with Securities Laws......................................................10
(f) BLUE SKY QUALIFICATIONS........................................................................10
(g) RULE 158.......................................................................................11
(h) USE OF PROCEEDS................................................................................11
(i) LISTING........................................................................................11
(j) RESTRICTION ON SALE OF SECURITIES..............................................................11
(k) REPORTING REQUIREMENTS.........................................................................11
4. PAYMENT OF EXPENSES.....................................................................................11
(a) EXPENSES.......................................................................................11
(b) TERMINATION OF AGREEMENT.......................................................................12
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SECTION PAGE
5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS.................................................................12
(a) EFFECTIVENESS OF REGISTRATION STATEMENT........................................................12
(b) OPINION OF COUNSEL FOR COMPANY.................................................................12
(c) OPINION OF COUNSEL FOR UNDERWRITERS............................................................12
(d) OFFICERS' CERTIFICATE..........................................................................13
(e) ACCOUNTANTS' COMFORT LETTER....................................................................13
(f) APPROVAL OF LISTING............................................................................13
(g) LOCK-UP AGREEMENTS.............................................................................13
(h) CONDITIONS TO PURCHASE OF OPTION SECURITIES....................................................13
(i) Officer's Certificate.................................................................13
(ii) Opinion of Counsel for Company........................................................14
(iii) Opinion of Counsel for Underwriters...................................................14
(iv) Bring-down Comfort Letter.............................................................14
(i) ADDITIONAL DOCUMENTS...........................................................................14
(j) TERMINATION OF AGREEMENT.......................................................................14
6. INDEMNIFICATION.........................................................................................14
(a) INDEMNIFICATION OF UNDERWRITERS................................................................14
(b) INDEMNIFICATION OF COMPANY, DIRECTORS AND OFFICERS.............................................15
(c) ACTIONS AGAINST PARTIES; NOTIFICATION..........................................................16
(d) SETTLEMENT WITHOUT CONSENT IF FAILURE TO REIMBURSE.............................................16
7. CONTRIBUTION............................................................................................16
8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY..........................................18
9. TERMINATION OF AGREEMENT................................................................................18
(a) TERMINATION; GENERAL...........................................................................18
(b) LIABILITIES....................................................................................18
10. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS..............................................................18
11. NOTICES.................................................................................................19
12. PARTIES.................................................................................................19
13. GOVERNING LAW...........................................................................................20
14. EFFECT OF HEADINGS......................................................................................20
15. UNDERWRITERS' COUNSEL...................................................................................20
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SCHEDULES
Schedule A - List of Underwriters Sch A-1
Schedule B - Option Securities Sch B-1
Schedule C - Pricing Information Sch C-1
Schedule D - List of Persons subject to Lock-up Sch D-1
EXHIBITS
Exhibit A - Contents of Opinions of Company Counsel A-1
Exhibit B - Contents of Accountants' Comfort Letter B-1
Exhibit C - Form of Lock-up Letter C-1
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SIERRA PACIFIC RESOURCES
(a Nevada corporation)
19,000,000 Shares of Common Stock
(Par Value $1.00 Per Share)
PURCHASE AGREEMENT
August __, 2001
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
▇▇▇▇▇▇▇, Sachs & Co.
▇▇▇▇▇▇ Brothers Inc.
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
as Representatives of the several Underwriters
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Ladies and Gentlemen:
Sierra Pacific Resources, a Nevada corporation (the "Company"),
confirms its agreement with ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ &
▇▇▇▇▇ Incorporated ("▇▇▇▇▇▇▇ ▇▇▇▇▇") and each of the other underwriters named in
Schedule A hereto (each an "Underwriter" and, collectively, the "Underwriters",
which terms shall also include any underwriter substituted as hereinafter
provided in Section 10 hereof), for whom ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇.▇. ▇▇▇▇▇▇▇ & Sons,
Inc., ▇▇▇▇▇▇▇, Sachs & Co. and ▇▇▇▇▇▇ Brothers Inc. are acting as
representatives (in such capacity, the "Representatives"), with respect to the
issue and sale by the Company, and the purchase by the Underwriters, acting
severally and not jointly, of the respective numbers of shares of Common Stock,
par value $1.00 per share, of the Company ("Common Stock") set forth in
Schedules A and B hereto and (ii) the grant by the Company to the Underwriters,
acting severally and not jointly, of the option described in Section 2(b) hereof
to purchase all or any part of 2,850,000 additional shares of Common Stock to
cover over-allotments, if any. The aforesaid 19,000,000 shares of Common Stock
(the "Initial Securities") to be purchased by the Underwriters and all or any
part of the 2,850,000 shares of Common Stock subject to the option described in
Section 2(b) hereof (the "Option Securities") are hereinafter called,
collectively, the "Securities".
The Company understands that the Underwriters propose to make a public
offering of the Securities as soon as the Representatives deem advisable after
this Agreement has been executed and delivered.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-64438) covering the
registration of the Securities under the Securities Act of 1933, as amended (the
"1933 Act"), including the related preliminary prospectus. Promptly after
execution and delivery of this Agreement, the Company will prepare and file a
prospectus in accordance with the provisions of Rule 430A ("Rule 430A") of the
rules and regulations of the Commission under the 1933 Act (the "1933 Act
Regulations") and paragraph (b) of Rule 424 ("Rule 424(b)") of the 1933 Act
Regulations. The information included in such prospectus that was omitted from
such registration statement at the time it became effective, but that is deemed
to be part of such registration statement at the time it became effective
pursuant to paragraph (b) of Rule 430A, is referred to as "Rule 430A
Information". Each prospectus used before such registration statement became
effective, and any prospectus that omitted, as applicable, the Rule 430A
Information, that was used after such effectiveness and prior to the execution
and delivery of this Agreement, is herein called a "preliminary prospectus".
Such registration statement, as amended, including the exhibits thereto,
schedules thereto, if any, and the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 under the 1933 Act, at the time it became
effective and including the Rule 430A Information is herein called the
"Registration Statement". The final prospectus, including the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933
Act, in the form first furnished to the Underwriters on or after the date hereof
for use in connection with the offering of the Securities is herein called the
"Prospectus". For purposes of this Agreement, all references to the Registration
Statement, any preliminary prospectus, the Prospectus or any amendment or
supplement to any of the foregoing shall be deemed to include the copy filed
with the Commission pursuant to its Electronic Data Gathering, Analysis and
Retrieval system ("▇▇▇▇▇").
All references in this Agreement to financial statements and schedules
and other information which is "contained," "included" or "stated" in the
Registration Statement, any preliminary prospectus or the Prospectus (or other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which is incorporated
by reference in the Registration Statement, any preliminary prospectus or the
Prospectus, as the case may be; and all references in this Agreement to
amendments or supplements to the Registration Statement, any preliminary
prospectus or the Prospectus shall be deemed to mean and include the filing of
any document under the Securities Exchange Act of 1934 (the "1934 Act") which is
incorporated by reference in the Registration Statement, such preliminary
prospectus or the Prospectus, as the case may be.
1. REPRESENTATIONS AND WARRANTIES.
(a) REPRESENTATIONS AND WARRANTIES BY THE COMPANY. The Company
represents and warrants to each Underwriter as of the date hereof, as of the
Closing Time referred to in Section 2(b) hereof, and as of each Date of
Delivery (if any) referred to in Section 2(b) hereof, and agrees with each
Underwriter, as follows:
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(i) COMPLIANCE WITH REGISTRATION REQUIREMENTS. The Company meets the
requirements for use of Form S-3 under the 1933 Act. The Registration
Statement has become effective under the 1933 Act and no stop order
suspending the effectiveness of the Registration Statement has been issued
under the 1933 Act and no proceedings for that purpose have been instituted
or are pending or, to the knowledge of the Company, are contemplated by the
Commission, and any request on the part of the Commission for additional
information has been complied with.
At the time the Registration Statement became effective and at the
Closing Time (and, if any Option Securities are purchased, at each Date of
Delivery), the Registration Statement and any amendments and supplements
thereto complied and will comply in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations and did not and
will 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 not misleading. Neither the Prospectus nor any
amendments or supplements thereto, at the time the Prospectus or any such
amendment or supplement was issued and at the Closing Time (and, if any
Option Securities are purchased, at each Date of Delivery), included or
will include an untrue statement of a material fact or omitted or will omit
to state a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading. The representations and warranties in this subsection shall not
apply to statements in or omissions from the Registration Statement or
Prospectus made in reliance upon and in conformity with information
furnished to the Company in writing by any Underwriter through ▇▇▇▇▇▇▇
▇▇▇▇▇ expressly for use in the Registration Statement or Prospectus.
Each preliminary prospectus and the 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 1933 Act, complied when so
filed in all material respects with the 1933 Act Regulations and each
preliminary prospectus and the Prospectus delivered to the Underwriters for
use in connection with this offering was identical to the electronically
transmitted copies thereof filed with the Commission pursuant to ▇▇▇▇▇,
except to the extent permitted by Regulation S-T.
(ii) INCORPORATED DOCUMENTS. The documents incorporated or deemed to be
incorporated by reference in the Registration Statement and the Prospectus,
at the time they were or hereafter are filed with the Commission, complied
and will comply in all material respects with the requirements of the 1934
Act and the rules and regulations of the Commission thereunder (the "1934
Act Regulations"), and, when read together with the other information in
the Prospectus, at the time the Registration Statement became effective, at
the time the Prospectus was issued and at the Closing Time (and, if any
Option Securities are purchased, at each Date of Delivery), did not and
will 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 not misleading.
(iii) INDEPENDENT ACCOUNTANTS. The accountants who certified the
financial statements and supporting schedules included in the Registration
Statement are
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independent public accountants as required by the 1933 Act and the 1933 Act
Regulations.
(iv) FINANCIAL STATEMENTS. The financial statements included in the
Registration Statement and the Prospectus, together with the related
schedules and notes, present fairly the financial position of the Company
and its consolidated subsidiaries at the dates indicated and the results of
operations, stockholders' equity and cash flows of the Company and its
consolidated subsidiaries for the periods specified; said financial
statements have been prepared in conformity with generally accepted
accounting principles ("GAAP") applied on a consistent basis, except as
noted therein, throughout the periods involved. The supporting schedules,
if any, included in the Registration Statement present fairly in accordance
with GAAP the information required to be stated therein. The selected
financial data and the summary financial information included in the
Prospectus present fairly the information shown therein and have been
compiled on a basis consistent with that of the audited financial
statements included in the Registration Statement. The pro forma financial
statements and the related notes thereto included in the Registration
Statement and the Prospectus present fairly the information shown therein,
have been prepared in accordance with the Commission's rules and guidelines
with respect to pro forma financial statements and have been properly
compiled on the bases described therein, and the assumptions used in the
preparation thereof are reasonable and the adjustments used therein are
appropriate to give effect to the transactions and circumstances referred
to therein.
(v) NO MATERIAL ADVERSE CHANGE IN BUSINESS. Since the respective dates
as of which information is given in the Registration Statement and the
Prospectus, except as otherwise stated therein, (A) there has been no
material adverse change, or any development which is reasonably likely to
result in a material adverse change, in the condition (financial or
otherwise), results of operations or business affairs of the Company and
its subsidiaries considered as one enterprise, whether or not arising in
the ordinary course of business (a "Material Adverse Effect"), (B) there
have been no transactions entered into by the Company or any of its
subsidiaries, other than those in the ordinary course of business, which
are material with respect to the Company and its subsidiaries considered as
one enterprise, and (C) except for dividends on the Common Stock in amounts
per share that are consistent with past practice, there has been no
dividend or distribution of any kind declared, paid or made by the Company
on any class of its capital stock.
(vi) GOOD STANDING OF THE COMPANY. The Company has been duly organized
and is validly existing as a corporation in good standing under the laws of
the State of Nevada and has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under this
Agreement; and the Company is duly qualified as a foreign corporation to
transact business and is in good standing in each other jurisdiction in
which such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure so
to qualify or to be in good standing would not result in a Material Adverse
Effect.
4
(vii) GOOD STANDING OF SUBSIDIARIES. Each "significant subsidiary" of
the Company (as such term is defined in Rule 1-02 of Regulation S-X) (each
a "Significant Subsidiary" and, collectively, the "Significant
Subsidiaries") has been duly organized and is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has corporate power and authority to own, lease and operate
its properties and to conduct its business as described in the Prospectus
and is duly qualified as a foreign corporation to transact business and is
in good standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure so to qualify or to be in
good standing would not result in a Material Adverse Effect; except as
otherwise disclosed in the Registration Statement, all of the issued and
outstanding capital stock of each Significant Subsidiary has been duly
authorized and validly issued, is fully paid and non-assessable and, in the
case of the common stock of each such Significant Subsidiary, is owned by
the Company, directly or through subsidiaries, free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or equity;
none of the outstanding shares of capital stock of any Significant
Subsidiary was issued in violation of any preemptive or similar rights of
any securityholder of such Significant Subsidiary. The only Significant
Subsidiaries of the Company are Sierra Pacific Power Company and Nevada
Power Company.
(viii) CAPITALIZATION. The issued and outstanding capital stock of the
Company is as set forth in the Company's consolidated statement of
capitalization as of December 31, 2000 incorporated by reference in the
Prospectus (except for subsequent issuances, if any, pursuant to
reservations, agreements, employee benefit plans, non-employee director
plans or the common stock investment plan). The shares of issued and
outstanding capital stock of the Company have been duly authorized and
validly issued and are fully paid and non-assessable; none of the
outstanding shares of capital stock of the Company was issued in violation
of any preemptive or other similar rights of any securityholder of the
Company.
(ix) AUTHORIZATION OF AGREEMENT. This Agreement has been duly
authorized, executed and delivered by the Company.
(x) AUTHORIZATION AND DESCRIPTION OF SECURITIES. The Securities have
been duly authorized for issuance and sale to the Underwriters pursuant to
this Agreement and, when issued and delivered by the Company pursuant to
this Agreement against payment of the consideration set forth herein, will
be validly issued and fully paid and non-assessable; the Securities conform
in all material respects to all statements relating thereto contained in
the Prospectus; no holder of the Securities will be subject to personal
liability by reason of being such a holder; and the issuance of the
Securities is not subject to any preemptive or other similar rights of any
securityholder of the Company.
(xi) ABSENCE OF DEFAULTS AND CONFLICTS. The execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated herein and in the Registration Statement and compliance by the
Company with its obligations hereunder have been duly authorized by all
necessary corporate action and do not and will not, whether with or without
the giving of notice or passage of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined below)
5
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of its
subsidiaries pursuant to, any indenture, mortgage, deed of trust, loan or
credit agreement, note, lease or other contract, agreement or instrument to
which the Company or any of its subsidiaries is a party, or by which it or
any of them may be bound, or to which any of the property or assets of the
Company or any of its subsidiaries may be subject (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that
would not result in a Material Adverse Effect), nor will such action result
in any violation of the provisions of the charter or by-laws of the Company
or any of its Significant Subsidiaries or any applicable law, statute,
rule, regulation, judgment, order, writ or decree of any government,
government instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any of its Significant Subsidiaries or any
of their assets, properties or operations. As used herein, a "Repayment
Event" means any event or condition which gives the holder of any note,
debenture or other evidence of indebtedness (or any person acting on such
holder's behalf) the right to require the repurchase, redemption or
repayment of all or a portion of such indebtedness by the Company or any
subsidiary.
(xii) ABSENCE OF PROCEEDINGS. Except as disclosed in the Prospectus,
there is no action, suit, proceeding, inquiry or investigation before or
brought by any court or governmental agency or body, domestic or foreign,
now pending, or, to the knowledge of the Company, threatened, against or
affecting the Company or any subsidiary, which is required to be disclosed
in the Registration Statement, or which, singly or in the aggregate, might
reasonably be expected to result in a Material Adverse Effect, or which
might reasonably be expected to materially and adversely affect the
consummation of the transactions contemplated in this Agreement or the
performance by the Company of its obligations hereunder.
(xiii) ACCURACY OF EXHIBITS. There are no contracts or documents which
are required to be described in the Registration Statement, the Prospectus
or the documents incorporated by reference therein or to be filed as
exhibits thereto which have not been so described and filed as required.
(xiv) ABSENCE OF FURTHER REQUIREMENTS. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
is necessary or required for the execution or delivery by the Company of,
the performance by the Company of its obligations under, or the
consummation by the Company of the transactions contemplated by this
Agreement or the Securities, except such as have been already obtained or
as may be required under the 1933 Act, the 1933 Act Regulations, the 1934
Act, 1934 Act Regulations, or state securities laws.
(xv) POSSESSION OF LICENSES AND PERMITS. The Company and its
Significant Subsidiaries possess such permits, licenses, approvals,
consents and other authorizations (collectively, "Governmental Licenses")
issued by the appropriate federal, state, local or foreign regulatory
agencies or bodies necessary to conduct the business now operated by them;
the Company and its Significant Subsidiaries are in compliance with the
terms and conditions of all such Governmental Licenses, except to the
extent that the failure so to
6
comply would not, singly or in the aggregate, have a Material Adverse
Effect; all of such Governmental Licenses are valid and in full force and
effect, except to the extent that the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full force
and effect would not have a Material Adverse Effect; and neither the
Company nor any of its Significant Subsidiaries has received any notice of
proceedings relating to the revocation or modification of any one or more
of such Governmental Licenses to the extent that the revocation or
modification thereof, singly or in the aggregate, would result in a
Material Adverse Effect.
(xvi) TITLE TO PROPERTY. The Company and its Significant Subsidiaries
have good and marketable title to all real property owned by them and good
title to all other properties owned by them, in each case, free and clear
of all mortgages, pledges, liens, security interests, claims, restrictions
or encumbrances of any kind except such as (a) are described or referred to
in the Prospectus or (b) do not, singly or in the aggregate, affect the
value of such property or interfere with the use made and proposed to be
made of such property to such extent as might reasonably be expected to
result in a Material Adverse Effect; and all of the leases and subleases
material to the business of the Company and its subsidiaries, considered as
one enterprise, and under which the Company or any of its Significant
Subsidiaries holds properties described in the Prospectus, are in full
force and effect, and neither the Company nor any Significant Subsidiary
has any notice of any claim of any sort that has been asserted by anyone
adverse to the rights of the Company or any subsidiary under any of the
leases or subleases mentioned above, or affecting or questioning the rights
of the Company or such subsidiary to the continued possession of the leased
or subleased premises under any such lease or sublease, to the extent that
such claim might reasonably be expected to result in a Material Adverse
Effect.
(xvii) INVESTMENT COMPANY ACT. The Company is not, and upon the
issuance and sale of the Securities as herein contemplated and the
application of the net proceeds therefrom as described in the Prospectus
will not be, an "investment company" or an entity "controlled" by an
"investment company" as such terms are defined in the Investment Company
Act of 1940, as amended (the "1940 Act").
(xviii) HOLDING COMPANY ACT. The Company is a "holding company" under
the Public Utility Holding Company Act of 1935, as amended (the "1935
Act"), but, pursuant to Section 3(a)(1) of the 1935 Act, is exempt from all
provisions of such Act except Section 9(a)(2) thereof.
(b) OFFICER'S CERTIFICATES. Any certificate signed by any officer of
the Company or any of its subsidiaries delivered to the Representatives or to
counsel for the Underwriters shall be deemed a representation and warranty by
the Company to each Underwriter as to the matters covered thereby.
2. SALE AND DELIVERY TO UNDERWRITERS; CLOSING.
(a) INITIAL SECURITIES. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company agrees to sell to
7
each Underwriter, severally and not jointly, and each Underwriter, severally and
not jointly, agrees to purchase from the Company, at the price per share set
forth in Schedule C, that proportion of the number of Initial Securities set
forth in Schedule B opposite the name of the Company, which the number of
Initial Securities set forth in Schedule A opposite the name of such
Underwriter, plus any additional number of Initial Securities which such
Underwriter may become obligated to purchase pursuant to the provisions of
Section 10 hereof, bears to the total number of Initial Securities, subject, in
each case, to such adjustments among the Underwriters as the Representatives in
their sole discretion shall make to eliminate any sales or purchases of
fractional securities.
(b) OPTION SECURITIES. In addition, on the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Company hereby grants an option to the Underwriters, severally
and not jointly, to purchase up to an additional 2,850,000 shares of Common
Stock, as set forth in Schedule B, at the price per share set forth in Schedule
C, less an amount per share equal to any dividends or distributions declared by
the Company and payable on the Initial Securities but not payable on the Option
Securities. The option hereby granted will expire 30 days after the date hereof
and may be exercised in whole or in part from time to time only for the purpose
of covering over-allotments which may be made in connection with the offering
and distribution of the Initial Securities upon notice by the Representatives to
the Company setting forth the number of Option Securities as to which the
several Underwriters are then exercising the option and the time and date of
payment and delivery for such Option Securities. Any such time and date of
delivery (a "Date of Delivery") shall be determined by the Representatives, but
shall not be later than seven full business days after the exercise of said
option, nor in any event prior to the Closing Time, as hereinafter defined. If
the option is exercised as to all or any portion of the Option Securities, each
of the Underwriters, acting severally and not jointly, will purchase that
proportion of the total number of Option Securities then being purchased which
the number of Initial Securities set forth in Schedule A opposite the name of
such Underwriter bears to the total number of Initial Securities, subject in
each case to such adjustments as the Representatives in their discretion shall
make to eliminate any sales or purchases of fractional shares.
(c) PAYMENT. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of
▇▇▇▇▇▇, ▇▇▇▇ & Priest LLP, or at such other place as shall be agreed upon by
the Representatives and the Company, at 9:00 A.M. (Eastern time) on the third
(fourth, if the pricing occurs after 4:30 P.M. (Eastern time) on any given day)
business day after the date hereof (unless postponed in accordance with the
provisions of Section 10), or such other time not later than ten business days
after such date as shall be agreed upon by the Representatives and the Company
(such time and date of payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the Option Securities are
purchased by the Underwriters, payment of the purchase price for, and delivery
of certificates for, such Option Securities shall be made at the above-mentioned
offices, or at such other place as shall be agreed upon by the Representatives
and the Company, on each Date of Delivery as specified in the notice from the
Representatives to the Company.
8
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
the Representatives for the respective accounts of the Underwriters of
certificates for the Securities to be purchased by them. It is understood that
each Underwriter has authorized the Representatives, for its account, to accept
delivery of, receipt for, and make payment of the purchase price for, the
Initial Securities and the Option Securities, if any, which it has agreed to
purchase. ▇▇▇▇▇▇▇ ▇▇▇▇▇, individually and not as representative of the
Underwriters, may (but shall not be obligated to) make payment of the purchase
price for the Initial Securities or the Option Securities, if any, to be
purchased by any Underwriter whose funds have not been received by the Closing
Time or the relevant Date of Delivery, as the case may be, but such payment
shall not relieve such Underwriter from its obligations hereunder.
(d) DENOMINATIONS; REGISTRATION. Certificates for the Initial
Securities and the Option Securities, if any, shall be in such denominations and
registered in such names as the Representatives may request in writing at least
one full business day before the Closing Time or the relevant Date of Delivery,
as the case may be. The certificates for the Initial Securities and the Option
Securities, if any, will be made available for examination and packaging by the
Representatives in The City of New York not later than 10:00 A.M. (Eastern time)
on the business day prior to the Closing Time or the relevant Date of Delivery,
as the case may be.
3. COVENANTS OF THE COMPANY. The Company covenants with each Underwriter
as follows:
(a) COMPLIANCE WITH SECURITIES REGULATIONS AND COMMISSION REQUESTS. The
Company, subject to Section 3(b), will comply with the requirements of Rule 430A
and will notify the Representatives immediately, and confirm the notice in
writing, (i) when any post-effective amendment to the Registration Statement
shall become effective, or any supplement to the Prospectus or any amended
Prospectus shall have been filed, (ii) of the receipt of any comments from the
Commission, (iii) of any request by the Commission for any amendment to the
Registration Statement or any amendment or supplement to the Prospectus or for
additional information, and (iv) of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or of any order
preventing or suspending the use of any preliminary prospectus, or of the
suspension of the qualification of the Securities for offering or sale in any
jurisdiction, or of the initiation or threatening of any proceedings for any of
such purposes. The Company will promptly effect the filings necessary pursuant
to Rule 424(b) and will take such steps as it deems necessary to ascertain
promptly whether the form of prospectus transmitted for filing under Rule 424(b)
was received for filing by the Commission and, in the event that it was not, it
will promptly file such prospectus. The Company will make every reasonable
effort to prevent the issuance of any stop order and, if any stop order is
issued, to obtain the lifting thereof at the earliest possible moment.
(b) FILING OF AMENDMENTS. The Company will give the Representatives
notice of its intention to file or prepare any amendment to the Registration
Statement or any amendment, supplement or revision to either the prospectus
included in the Registration Statement at the time it became effective or to the
Prospectus, whether pursuant to the 1933 Act, the 1934 Act or otherwise, will
furnish the Representatives with copies of any such documents a reasonable
amount of time prior to such proposed filing or use, as the case may be, and
will not file or use
9
any such document to which the Representatives or counsel for the Underwriters
shall reasonably object.
(c) DELIVERY OF REGISTRATION STATEMENTS. The Company has furnished or
will deliver to the Representatives and counsel for the Underwriters, without
charge, signed copies of the Registration Statement as originally filed and of
each amendment thereto (including exhibits filed therewith or incorporated by
reference therein and documents incorporated or deemed to be incorporated by
reference therein) and signed copies of all consents and certificates of
experts, and will also deliver to the Representatives, without charge, a
conformed copy of the Registration Statement as originally filed and of each
amendment thereto (without exhibits) for each of the Underwriters. The copies of
the Registration Statement and each amendment thereto furnished to the
Underwriters will be identical to the electronically transmitted copies thereof
filed with the Commission pursuant to ▇▇▇▇▇, except to the extent permitted by
Regulation S-T.
(d) DELIVERY OF PROSPECTUSES. The Company has delivered to each
Underwriter, without charge, as many copies of each preliminary prospectus as
such Underwriter reasonably requested, and the Company hereby consents to the
use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each Underwriter, without charge, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, such
number of copies of the Prospectus (as amended or supplemented) as such
Underwriter may reasonably request. The Prospectus and any amendments or
supplements thereto furnished to the Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
▇▇▇▇▇, except to the extent permitted by Regulation S-T.
(e) CONTINUED COMPLIANCE WITH SECURITIES LAWS. The Company will comply
with the 1933 Act and the 1933 Act Regulations and the 1934 Act and the 1934 Act
Regulations so as to permit the completion of the distribution of the Securities
as contemplated in this Agreement and in the Prospectus. If at any time when a
prospectus is required by the 1933 Act to be delivered in connection with sales
of the Securities, any event shall occur or condition shall exist as a result of
which it is necessary, in the opinion of counsel for the Underwriters or for the
Company, to amend the Registration Statement or amend or supplement the
Prospectus in order that the Prospectus will not include any untrue statements
of a material fact or omit to state a material fact necessary in order to make
the statements therein not misleading in the light of the circumstances existing
at the time it is delivered to a purchaser, or if it shall be necessary, in the
opinion of such counsel, at any such time to amend the Registration Statement or
amend or supplement the Prospectus in order to comply with the requirements of
the 1933 Act or the 1933 Act Regulations, the Company will promptly prepare and
file with the Commission, subject to Section 3(b), such amendment or supplement
as may be necessary to correct such statement or omission or to make the
Registration Statement or the Prospectus comply with such requirements, and the
Company will furnish to the Underwriters such number of copies of such amendment
or supplement as the Underwriters may reasonably request.
(f) BLUE SKY QUALIFICATIONS. The Company will use its best efforts, in
cooperation with the Underwriters, to qualify the Securities for offering and
sale under the applicable securities laws of such states and other jurisdictions
(domestic or foreign) as the Representatives may designate and to maintain such
qualifications in effect for a period of not less than one year
10
from the date of this Agreement; provided, however, that the Company shall not
be obligated to file any general consent to service of process or to qualify as
a foreign corporation or as a dealer in securities in any jurisdiction in which
it is not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject. In each
jurisdiction in which the Securities have been so qualified, the Company will
file such statements and reports as may be required by the laws of such
jurisdiction to continue such qualification in effect for a period of not less
than one year from the date of this Agreement.
(g) RULE 158. The Company will timely file such reports pursuant to the
1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earning statement for the purposes of,
and to provide the benefits contemplated by, the last paragraph of Section 11(a)
of the 1933 Act.
(h) USE OF PROCEEDS. The Company will use the net proceeds received by
it from the sale of the Securities in the manner specified in the Prospectus
under "Use of Proceeds".
(i) LISTING. The Company will use its best efforts to effect the
listing of the Securities on the New York Stock Exchange.
(j) RESTRICTION ON SALE OF SECURITIES. During a period of 90 business
days from the date of the Prospectus, the Company will not, without the prior
written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇, (i) directly or indirectly, 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 or
otherwise transfer or dispose of any share of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock or file any
registration statement under the 1933 Act with respect to any of the foregoing
or (ii) enter into any swap or any other agreement or any transaction that
transfers, in whole or in part, directly or indirectly, the economic consequence
of ownership of the Common Stock, whether any such swap or transaction described
in clause (i) or (ii) 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) the Securities to be sold hereunder, (B) any shares of Common Stock
issued by the Company upon the exercise of an option or warrant or the
conversion of a security outstanding on the date hereof and referred to in the
Prospectus, (C) any shares of Common Stock issued or options to purchase Common
Stock granted pursuant to any existing employee benefit plan or non-employee
director stock plan of the Company referred to or contemplated by the
Prospectus, or (D) any shares of Common Stock issued pursuant to the common
stock investment plan.
(k) REPORTING REQUIREMENTS. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, will
file all documents required to be filed with the Commission pursuant to the 1934
Act within the time periods required by the 1934 Act and the 1934 Act
Regulations.
4. PAYMENT OF EXPENSES.
(a) EXPENSES. The Company will pay or cause to be paid all expenses
incident to the performance of its obligations under this Agreement, including
(i) the preparation, printing and filing of the Registration Statement
(including financial statements and exhibits) as originally
11
filed and of each amendment thereto, (ii) the preparation, printing and delivery
to the Underwriters of this Agreement, any agreement among Underwriters and such
other documents as may be required in connection with the offering, purchase,
sale, issuance or delivery of the Securities, (iii) the preparation, issuance
and delivery of the certificates for the Securities to the Underwriters,
including any stock or other transfer taxes and any stamp or other duties
payable upon the sale, issuance or delivery of the Securities to the
Underwriters, (iv) the fees and disbursements of the Company's counsel,
accountants and other advisors, (v) the qualification of the Securities under
securities laws in accordance with the provisions of Section 3(f) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the preparation
of the Blue Sky Survey and any supplement thereto, (vi) the printing and
delivery to the Underwriters of copies of each preliminary prospectus and of the
Prospectus and any amendments or supplements thereto, (vii) the preparation,
printing and delivery to the Underwriters of copies of the Blue Sky Survey and
any supplement thereto, (viii) the fees and expenses of any transfer agent or
registrar for the Securities and (ix) the fees and expenses incurred in
connection with the listing of the Securities on the New York Stock Exchange.
(b) TERMINATION OF AGREEMENT. If this Agreement is terminated by the
Representatives in accordance with the provisions of Section 5, Section 9(a)(i)
or Section 10 hereof, the Company shall reimburse the Underwriters for all of
their out-of-pocket expenses, including the reasonable fees and disbursements of
counsel for the Underwriters.
5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of the several
Underwriters hereunder are subject to the accuracy of the representations and
warranties of the Company contained in Section 1 hereof or in certificates of
any officer of the Company or any subsidiary of the Company delivered pursuant
to the provisions hereof, to the performance by the Company of its covenants and
other obligations hereunder, and to the following further conditions:
(a) EFFECTIVENESS OF REGISTRATION STATEMENT. The Registration Statement
shall have become effective and at Closing Time no stop order suspending the
effectiveness of the Registration Statement shall have been issued under the
1933 Act or proceedings therefor initiated or threatened by the Commission, and
any request on the part of the Commission for additional information shall have
been complied with to the reasonable satisfaction of counsel to the
Underwriters. A prospectus containing the Rule 430A Information shall have been
filed with the Commission in accordance with Rule 424(b) (or a post-effective
amendment providing such information shall have been filed and declared
effective in accordance with the requirements of Rule 430A).
(b) OPINION OF COUNSEL FOR COMPANY. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of Closing
Time, of each of ▇▇▇▇▇▇▇▇ and Wedge and of ▇▇▇▇▇▇, Hall & ▇▇▇▇▇▇▇, counsel for
the Company, in form and substance satisfactory the Representatives and counsel
to the Underwriters, together with signed or reproduced copies of such letter
for each of the other Underwriters, to the effect set forth in Exhibit A hereto
and to such further effect as counsel to the Underwriters may reasonably
request.
(c) OPINION OF COUNSEL FOR UNDERWRITERS. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of Closing
Time, of ▇▇▇▇▇▇ ▇▇▇▇ & Priest LLP,
12
counsel for the Underwriters, together with signed or reproduced copies of such
letter for each of the other Underwriters with respect to such matters as the
Representatives may reasonably request. In giving such opinion such counsel may
rely, as to all matters governed by the laws of jurisdictions other than the law
of the State of New York and the federal law of the United States, upon the
opinions of counsel satisfactory to the Representatives. Such counsel may also
state that, insofar as such opinion involves factual matters, they have relied,
to the extent they deem proper, upon certificates of officers of the Company and
its subsidiaries and certificates of public officials.
(d) OFFICERS' CERTIFICATE. At Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information is
given in the Prospectus, any material adverse change, or any development which
is reasonably likely to result in a material adverse change, in the condition
(financial or otherwise), results of operations or business affairs of the
Company and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, and the Representatives shall have
received a certificate of the President or a Vice President of the Company and
of the chief financial or chief accounting officer of the Company, dated as of
Closing Time, to the effect that (i) there has been no such material adverse
change or development, (ii) the representations and warranties in Section 1(a)
hereof are true and correct with the same force and effect as though expressly
made at and as of Closing Time, (iii) the Company has complied with all
agreements and satisfied all conditions on its part to be performed or satisfied
at or prior to Closing Time and (iv) no stop order suspending the effectiveness
of the Registration Statement has been issued and no proceedings for that
purpose have been instituted or are pending or are contemplated by the
Commission.
(e) ACCOUNTANTS' COMFORT LETTER. At Closing Time, the Representatives
shall have received from Deloitte & Touche LLP a letter dated such date, in form
and substance satisfactory to the Representatives, together with signed or
reproduced copies of such letter for each of the other Underwriters containing
statements and information of the type set forth or referred to in Exhibit B
hereto.
(f) APPROVAL OF LISTING. At Closing Time, the Securities shall have
been approved for listing on the New York Stock Exchange, subject only to
official notice of issuance.
(g) LOCK-UP AGREEMENTS. At the date of this Agreement, the
Representatives shall have received an agreement substantially in the form of
Exhibit C hereto signed by the persons listed on Schedule D hereto.
(h) CONDITIONS TO PURCHASE OF OPTION SECURITIES. In the event that the
Underwriters exercise their option provided in Section 2(b) hereof to purchase
all or any portion of the Option Securities, the representations and warranties
of the Company contained herein and the statements in any certificates furnished
by the Company, any subsidiary of the Company hereunder shall be true and
correct as of each Date of Delivery and, at the relevant Date of Delivery, the
Representatives shall have received:
(i) OFFICER'S CERTIFICATE. A certificate, dated such Date of
Delivery, of the President or a Vice President of the Company and of the chief
financial or chief accounting
13
officer of the Company confirming that the certificate delivered at the Closing
Time pursuant to Section 5(d) hereof remains true and correct as of such Date of
Delivery.
(ii) OPINION OF COUNSEL FOR COMPANY. The favorable opinion of each
of ▇▇▇▇▇▇▇▇ and Wedge and ▇▇▇▇▇▇, Hall & ▇▇▇▇▇▇▇, counsel for the Company, in
form and substance satisfactory to counsel for the Underwriters, dated such Date
of Delivery, relating to the Option Securities to be purchased on such Date of
Delivery and otherwise to the same effect as the opinion required by Section
5(b) hereof.
(iii) OPINION OF COUNSEL FOR UNDERWRITERS. The favorable opinion
of ▇▇▇▇▇▇ ▇▇▇▇ & Priest LLP, counsel for the Underwriters, dated such Date of
Delivery, relating to the Option Securities to be purchased on such Date of
Delivery and otherwise to the same effect as the opinion required by Section
5(c) hereof.
(iv) BRING-DOWN COMFORT LETTER. A letter from Deloitte & Touche
LLP, in form and substance satisfactory to the Representatives and dated such
Date of Delivery, substantially in the same form and substance as the letter
furnished to the Representatives pursuant to Section 5(e) hereof, except that
the "specified date" in the letter furnished pursuant to this paragraph shall be
a date not more than five days prior to such Date of Delivery.
(i) ADDITIONAL DOCUMENTS. At Closing Time and at each Date of
Delivery, counsel for the Underwriters shall have been furnished with such
documents and opinions as they may require for the purpose of enabling them to
pass upon the issuance and sale of the Securities as herein contemplated, or in
order to evidence the accuracy of any of the representations or warranties, or
the fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company in connection with the issuance and sale of the Securities
as herein contemplated shall be satisfactory in form and substance to the
Representatives and counsel for the Underwriters.
(j) TERMINATION OF AGREEMENT. If any condition specified in this
Section shall not have been fulfilled when and as required to be fulfilled, this
Agreement, or, in the case of any condition to the purchase of Option Securities
on a Date of Delivery which is after the Closing Time, the obligations of the
several Underwriters to purchase the relevant Option Securities, may be
terminated by the Representatives by notice to the Company at any time at or
prior to Closing Time or such Date of Delivery, as the case may be, and such
termination shall be without liability of any party to any other party except as
provided in Section 4 and except that Sections 1, 6, 7 and 8 shall survive any
such termination and remain in full force and effect.
6. INDEMNIFICATION.
(a) INDEMNIFICATION OF UNDERWRITERS. The Company agrees to indemnify
and hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(or any amendment thereto), including the Rule 430A Information, or the
omission or alleged omission therefrom of a material fact
14
required to be stated therein or necessary to make the statements
therein not misleading or arising out of any untrue statement or alleged
untrue statement of a material fact contained in any preliminary
prospectus, or the omission or alleged omission therefrom of a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided that (subject to Section
6(d) below) any such settlement is effected with the written consent of the
Company; and
(iii) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by ▇▇▇▇▇▇▇ ▇▇▇▇▇), reasonably
incurred in investigating, preparing or defending against any litigation,
or any investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or omission, to
the extent that any such expense is not paid under (i) or (ii) above;
PROVIDED, HOWEVER, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through ▇▇▇▇▇▇▇ ▇▇▇▇▇ expressly for use in the Registration
Statement (or any amendment thereto), including the Rule 430A Information or any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto); and provided, further that this indemnity agreement shall not inure to
the benefit of any Underwriter or any person who controls such Underwriter on
account of any such loss, liability, claim, damage or expense arising out of any
such defect or alleged defect in any preliminary prospectus if a copy of the
Prospectus (exclusive of the Incorporated Documents), shall not have been given
or sent by such Underwriter with or prior to the written confirmation of the
sale involved to the extent that (i) the Prospectus would have cured such defect
or alleged defect and (ii) sufficient quantities of the Prospectus were timely
made available to such Underwriter.
(b) INDEMNIFICATION OF COMPANY, DIRECTORS AND OFFICERS. Each
Underwriter severally agrees to indemnify and hold harmless the Company, its
directors, each of its officers who signed the Registration Statement, and each
person, if any, who controls the Company within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act, against any and all loss, liability,
claim, damage and expense described in the indemnity contained in subsection (a)
of this Section 6, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Registration
Statement (or any amendment thereto), including the Rule 430A Information or any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written information furnished
to the Company by such Underwriter through ▇▇▇▇▇▇▇ ▇▇▇▇▇ expressly for use in
the
15
Registration Statement (or any amendment thereto) or such preliminary prospectus
or the Prospectus (or any amendment or supplement thereto).
(c) ACTIONS AGAINST PARTIES; NOTIFICATION. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by ▇▇▇▇▇▇▇ ▇▇▇▇▇, and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or Section
7 hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent, (i) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any indemnified party.
(d) SETTLEMENT WITHOUT CONSENT IF FAILURE TO REIMBURSE. If at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
7. CONTRIBUTION. If the indemnification provided for in Section 6 hereof
is for any reason unavailable to or insufficient to hold harmless an indemnified
party in respect of any losses, liabilities, claims, damages or expenses
referred to therein, then each indemnifying party shall contribute to the
aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and the Underwriters on the other hand from the offering of the Securities
pursuant to this Agreement or (ii) if the allocation provided by clause (i) is
not permitted by applicable law, in such proportion as is appropriate to
16
reflect not only the relative benefits referred to in clause (i) above but also
the relative fault of the Company on the one hand and of the Underwriters on the
other hand in connection with the statements or omissions which resulted in such
losses, liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company on the one hand and the
Underwriters on the other hand in connection with the offering of the Securities
pursuant to this Agreement shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of the Securities
pursuant to this Agreement (before deducting expenses) received by the Company
and the total underwriting discount received by the Underwriters, in each case
as set forth on the cover of the Prospectus bear to the aggregate initial public
offering price of the Securities as set forth on such cover.
The relative fault of the Company on the one hand and the Underwriters
on the other hand shall be determined by reference to, among other things,
whether any such untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of any such untrue or
alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the ▇▇▇▇ ▇▇▇) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall
have the same rights to contribution as the Company. The Underwriters'
respective obligations
17
to contribute pursuant to this Section 7 are several in proportion to the number
of Securities set forth opposite their respective names in Schedule A hereto and
not joint.
8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY. All
representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company or any of its subsidiaries submitted
pursuant hereto, shall remain operative and in full force and effect, regardless
of any investigation made by or on behalf of any Underwriter or controlling
person, or by or on behalf of the Company, and shall survive delivery of the
Securities to the Underwriters.
9. TERMINATION OF AGREEMENT.
(a) TERMINATION; GENERAL
The Representatives may terminate this Agreement, by notice to the
Company, at any time at or prior to Closing Time (i) if there has been, since
the time of execution of this Agreement or since the respective dates as of
which information is given in the Prospectus, any material adverse change, or
any development which is reasonably likely to result in a material adverse
change, in the condition (financial or otherwise), results of operations or
business affairs of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business, or (ii)
if there has occurred any material adverse change in the financial markets in
the United States or the international financial markets, any outbreak of
hostilities or escalation thereof or other calamity or crisis or any change or
development involving a prospective change in national or international
political, financial or economic conditions, in each case the effect of which is
such as to make it, in the judgment of the Representatives, impracticable to
market the Securities or to enforce contracts for the sale of the Securities, or
(iii) if trading in any securities of the Company has been suspended or
materially limited by the Commission or the New York Stock Exchange, or if
trading generally on the American Stock Exchange or the New York Stock Exchange
or in the Nasdaq National Market has been suspended or materially limited, or
minimum or maximum prices for trading have been fixed, or maximum ranges for
prices have been required, by any of said exchanges or by such system or by
order of the Commission, the National Association of Securities Dealers, Inc. or
any other governmental authority, or (iv) if a banking moratorium has been
declared by either Federal, Nevada or New York authorities.
(b) LIABILITIES. If this Agreement is terminated pursuant to this
Section 9, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and except that Sections 1, 6, 7,
and 8 shall survive such termination and remain in full force and effect.
10. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS. If one or more of the
Underwriters shall fail at Closing Time or a Date of Delivery to purchase the
Securities which it or they are obligated to purchase under this Agreement (the
"Defaulted Securities"), the Representatives shall have the right, within 24
hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms herein set
18
forth; if, however, the Representatives shall not have completed such
arrangements within such 24-hour period, then:
(i) if the number of Defaulted Securities does not exceed 10% of the
number of Securities to be purchased on such date, each of the
non-defaulting Underwriters shall be obligated, severally and not jointly,
to purchase the full amount thereof in the proportions that their
respective underwriting obligations hereunder bear to the underwriting
obligations of all non-defaulting Underwriters, or
(ii) if the number of Defaulted Securities exceeds 10% of the number of
Securities to be purchased on such date, this Agreement or, with respect to
any Date of Delivery which occurs after the Closing Time, the obligation of
the Underwriters to purchase and of the Company to sell the Option
Securities to be purchased and sold on such Date of Delivery, this
Agreement shall terminate without liability on the part of any
non-defaulting Underwriter.
No action taken pursuant to this Section 10 shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement or, in the case of a Date of Delivery which is after the
Closing Time, which does not result in a termination of the obligation of the
Underwriters and the Company to sell the relevant Option Securities, as the case
may be, either (i) the Representatives or (ii) the Company shall have the right
to postpone Closing Time or the relevant Date of Delivery, as the case may be,
for a period not exceeding seven days in order to effect any required changes in
the Registration Statement or Prospectus or in any other documents or
arrangements. As used herein, the term "Underwriter" includes any person
substituted for an Underwriter under this Section 10.
11. NOTICES. All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given if mailed or transmitted by
any standard form of telecommunication. Notices to the Underwriters shall be
directed to the Representatives at North Tower, World Financial Center, New
York, New York 10281-1201, attention of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇; and notices to the
Company shall be directed to it at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇.▇. ▇▇▇ ▇▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇, attention of ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇; or at such other address or to such
other person as either party may designate from time to time by notice given in
accordance with this Section 11.
12. PARTIES. This Agreement shall each inure to the benefit of and be
binding upon the Underwriters, the Company and their respective successors.
Nothing expressed or mentioned in this Agreement is intended or shall be
construed to give any person, firm or corporation, other than the Underwriters,
the Company and their respective successors and the controlling persons and
officers and directors referred to in Sections 6 and 7 and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. This Agreement and
all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the Underwriters, the Company and their respective
successors, and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of
19
Securities from any Underwriter shall be deemed to be a successor by reason
merely of such purchase.
13. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
14. EFFECT OF HEADINGS. The Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.
15. UNDERWRITERS' COUNSEL. The Company and the Underwriters acknowledge
that ▇▇▇▇▇▇ ▇▇▇▇ & Priest LLP (a) has acted or will act as counsel to the
Underwriters in connection with this Agreement and the transactions contemplated
hereby and (b) has acted, and will continue to act, as counsel to Sierra Pacific
Resources and its utility subsidiaries in connection with certain federal income
tax matters, and each of the Company and the Underwriters consents to such dual
representation.
20
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
among the Underwriters and the Company in accordance with its terms.
Very truly yours,
SIERRA PACIFIC RESOURCES
By
---------------------------------------
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
▇▇▇▇▇▇▇, SACHS & CO.
▇▇▇▇▇▇ BROTHERS INC.
▇.▇. ▇▇▇▇▇▇▇ & SONS, INC.
BY: ▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
By
-----------------------------------------
Authorized Signatory
For themselves and as Representatives of the other Underwriters named
in Schedule A hereto.
21
SCHEDULE A
NAME OF UNDERWRITER NUMBER OF
INITIAL SECURITIES
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated............................................................
▇▇▇▇▇▇▇ Sachs & Co......................................................................
▇▇▇▇▇▇ Brothers Inc.....................................................................
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc................................................................
Credit Suisse First Boston Corporation..................................................
Deutsche Banc Alex. ▇▇▇▇▇ Inc. .........................................................
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co., L.P. ............................................................
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, Incorporated....................................................
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, LLC...................................................................
U.S. Bancorp ▇▇▇▇▇ ▇▇▇▇▇▇▇ Inc. ........................................................
UBS Warburg LLC.........................................................................
▇▇▇▇▇▇▇▇ Capital Partners, L.P. ........................................................
▇▇▇▇▇ Fargo Investments, LLC............................................................
Total................................................................................... 19,000,000
==========
Sch A-1
SCHEDULE B
NUMBER OF INITIAL MAXIMUM NUMBER OF OPTION
SECURITIES TO BE SOLD SECURITIES TO BE SOLD
SIERRA PACIFIC RESOURCES 19,000,000 2,850,000
======================================================================================================================
Total 19,000,000 2,850,000
Sch B-1
SCHEDULE C
SIERRA PACIFIC RESOURCES
19,000,000 Shares of Common Stock
(Par Value $1.00 Per Share)
1. The initial public offering price per share for the Securities,
determined as provided in said Section 2, shall be $____.
2. The purchase price per share for the Securities to be paid by the
several Underwriters shall be $____, being an amount equal to the initial public
offering price set forth above less $____ per share; provided that the purchase
price per share for any Option Securities purchased upon the exercise of the
over-allotment option described in Section 2(b) shall be reduced by an amount
per share equal to any dividends or distributions declared by the Company and
payable on the Initial Securities but not payable on the Option Securities.
Sch C-1
SCHEDULE D
List of persons and entities
subject to lock-up
Sch D-1
Exhibit A
CONTENTS OF OPINIONS OF COMPANY COUNSEL
1. The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Nevada.
2. The Company has corporate power and authority to own, lease and operate
its properties and to conduct its business as described in the Prospectus and to
enter into and perform its obligations under the Purchase Agreement.
3. The Company is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure so to qualify or
to be in good standing would not result in a Material Adverse Effect.
4. Each Significant Subsidiary has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the jurisdiction of
its incorporation, has corporate power and authority to own, lease and operate
its properties and to conduct its business as described in the Prospectus and is
duly qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required, whether
by reason of the ownership or leasing of property or the conduct of business,
except where the failure so to qualify or to be in good standing would not
result in a Material Adverse Effect; all of the issued, and outstanding capital
stock of each Significant Subsidiary has been duly authorized and validly
issued, is fully paid and nonassessable and in the case of the common stock of
each Significant Subsidiary, to the best of our knowledge, is owned by the
Company, directly or through subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity; none of the
outstanding shares of capital stock of any Significant Subsidiary was issued in
violation of the preemptive or similar rights of any securityholder of such
Significant Subsidiary.
5. The Purchase Agreement has been duly authorized, executed and delivered
by the Company.
6. The Company has 250 million shares of common stock authorized under
its charter; the shares of issued and currently outstanding common stock of
the Company (excluding shares issued pursuant to reservations, agreements,
employee benefit plans, non-employee director plans or the common stock
investment plans) have been duly authorized and validly issued and are fully
paid and non-assessable; and none of the outstanding shares of common stock
of the Company was issued in violation of the preemptive or other similar
rights of any securityholder of the Company.
7. The Securities to be purchased by the Underwriters from the Company
have been duly authorized for issuance and sale to the Underwriters pursuant to
the Purchase Agreement and,
A-1
when issued and delivered by the Company pursuant to the Purchase Agreement
against payment of the consideration set forth in the Purchase Agreement, will
be validly issued and fully paid and non-assessable and no holder of the
Securities is or will be subject to personal liability by reason of being such a
holder.
8. The Registration Statement has been declared effective under the 1933
Act; any required filing of the Prospectus pursuant to Rule 424(b) and
Rule 430A has been made in the manner and within the time periods required by
Rule 424(b) and Rule 430A; and, to the best of our knowledge, no stop order
suspending the effectiveness of the Registration Statement has been issued
under the 1933 Act and no proceedings for that purpose have been instituted or
are pending or threatened by the Commission.
9. The Registration Statement, including any Rule 430A Information, and
the Prospectus, excluding the documents incorporated by reference therein,
and each amendment or supplement to the Registration Statement and Prospectus,
excluding the documents incorporated by reference therein, as of their
respective effective or issue dates (other than the financial statements and
supporting schedules included therein or omitted therefrom) complied as to
form in all material respects with the requirements of the 1933 Act and the
1933 Act Regulations.
10. The documents incorporated by reference in the Prospectus (other than
the financial statements and supporting schedules included therein or omitted
therefrom, as to which we express no opinion), when they were filed with the
Commission complied as to form in all material respects with the requirements of
the 1933 Act or the 1934 Act as applicable and the rules and regulations of the
Commission thereunder.
11. To the best of our knowledge, except as disclosed in the Registration
Statement, there is not pending or threatened any action, suit, proceeding,
inquiry or investigation, to which the Company or any subsidiary is a party, or
to which the property of the Company or any subsidiary is subject, before or
brought by any court or governmental agency or body, domestic or foreign, which
might reasonably be expected to result in a Material Adverse Effect, or which
might reasonably be expected to materially and adversely affect the properties
or assets of the Company or the consummation of the transactions contemplated in
the Purchase Agreement or the performance by the Company of its obligations
thereunder.
12. To the best of our knowledge, there are no statutes or regulations that
are required to be described in the Prospectus that are not described as
required.
13. All descriptions in the Registration Statement of contracts and other
documents to which the Company or its subsidiaries are a party are accurate in
all material respects; to the best of our knowledge, there are no franchises,
contracts, indentures, mortgages, loan agreements, notes, leases or other
instruments required to be described or referred to in the Registration
Statement or to be filed as exhibits thereto other than those described or
referred to therein or filed or incorporated by reference as exhibits thereto,
and the descriptions thereof or references thereto are correct in all material
respects.
14. No filing with, or authorization, approval, consent, license, order,
registration, qualification or decree of, any court or governmental authority or
agency, domestic or foreign
A-2
(other than under the 1933 Act and the 1933 Act Regulations, which have been
obtained, or as may be required under the securities or blue sky laws of the
various states, as to which we express no opinion) is necessary or required in
connection with the due authorization, execution and delivery of the Purchase
Agreement or for the offering, issuance, sale or delivery of the Securities.
15. The execution, delivery and performance of the Purchase Agreement and
the Securities and the consummation of the transactions contemplated in the
Purchase Agreement and in the Registration Statement (including the issuance
and sale of the Securities and the use of the proceeds from the sale of the
Securities as described in the Prospectus under the caption "Use Of Proceeds")
and compliance by the Company with its obligations under the Purchase Agreement
do not and will not, whether with or without the giving of notice or lapse of
time or both, (a) constitute a breach of, or default or Repayment Event
(as defined in Section 1(a) (xi) of the Purchase Agreement) under or result
in the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any Significant Subsidiary pursuant to any
contact, indenture, mortgage, deed of trust, loan or credit agreement, note,
lease or any other agreement or instrument, known to us to which the Company
or any Significant Subsidiary is a party or by which it or any of them may be
bound, or to which any of the property or assets of the Company or any
Significant Subsidiary is subject (except for such breaches or defaults or
liens, charges, or encumbrances that would not have a Material Adverse Effect),
or (b) result in any violation of the provisions of the charter or by-laws of
the Company or any Significant Subsidiary, or any applicable law, statute,
rule, regulation, judgment, order, writ or decree, known to us, of any
government, government instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any Significant Subsidiary or any of their
respective properties, assets or operations.
16. The information in the Prospectus under "Risk Factors", "The Company",
"Regulatory Matters", and "Description of the Common Stock" and in the
Registration Statement under Item 15, to the extent that it constitutes matters
of law, summaries of legal matters, the Company's charter and bylaws, or legal
conclusions, has been reviewed by us and is correct in all material respects.
17. The Company is not an "investment company" or an entity "controlled" by
an "investment company", as such terms are defined in the 1940 Act.
18. The Company is a "holding company" under the Public Utility Holding
Company Act of 1935, as amended (the "1935 Act"), but, pursuant to Section
3(a)(1) of the 1935 Act, is exempt from all provisions of such Act except
Section 9(a)(2) thereof.
Notes: (a) ▇▇▇▇▇▇▇▇ and Wedge will render the opinions set forth in
paragraphs (1), (2), (3), (4), (5), (6), (7), (14) and (15)(b)
to the extent the matters set forth therein are governed by or
relate to Nevada law, or instruments governed thereby, or
relate to the State of Nevada or agencies thereof.
(b) ▇▇▇▇▇▇, Hall & ▇▇▇▇▇▇▇ will render all the opinions set forth
above, relying on ▇▇▇▇▇▇▇▇ and Wedge as to matters governed by
or relating to Nevada law. In addition, ▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇
will state, in customary fashion, their belief as to the
absence of misstatements and omissions of material facts in
the Registration Statement and the Prospectus.
A-3
Exhibit B
CONTENTS OF LETTER OF INDEPENDENT AUDITORS
The letter, dated as of Closing Time, of Deloitte & Touche LLP shall be
in agreed form and shall confirm that they are independent public accountants
within the meaning of the 1933 Act and the applicable 1933 Act Regulations and
shall be further to the effect that:
(i) in their opinion the financial statements examined by them and
included in the documents incorporated by reference in the Registration
Statement and the Prospectus (the "Incorporated Documents") comply as to
form in all material respects with the applicable accounting requirements
of the 1933 Act and the related published 1933 Act Regulations;
(ii) they have performed the procedures specified by the American
Institute of Certified Public Accountants for a review of interim financial
information as described in Statement of Auditing Standards No. 71, Interim
Financial Information, on the unaudited financial statements included in
the Incorporated Documents;
(iii) on the basis of the review referred to in clause (ii) above, a
reading of the latest available interim financial statements of the
Company, inquiries of officials of the Company who have responsibility for
financial and accounting matters and other specified procedures, nothing
came to their attention that caused them to believe that:
(A) the unaudited financial statements included in the
Incorporated Documents do not comply as to form in all
material respects with the applicable accounting requirements
of the 1933 Act and the related published 1933 Act Regulations
or that any material modifications should be made to such
unaudited financial statements for them to be in conformity
with generally accepted accounting principles;
(B) at the date of the latest available balance sheet read by such
accountants, or at a subsequent specified date not more than
three business days prior to the date of such letter, there
was any change in the capital stock or any increase in
long-term debt or any decreases in net current assets or
stockholders' equity of the Company and its consolidated
subsidiaries as compared with amounts shown on the latest
balance sheet included in the Incorporated Documents; or
(C) for the period from the closing date of the latest income
statement included in the Incorporated Documents to the
closing date of the latest available income statement read by
such accountants, there were any decreases, as compared with
the corresponding period of the previous year and with the
period of corresponding length
B-1
ended the date of the latest income statement included in the
Incorporated Documents, in consolidated operating revenue, net
income and basic and diluted net income per share;
except in all cases set forth in clauses (B) and (C) above for changes,
increases or decreases which the Incorporated Documents disclose have
occurred or may occur or which are described in such letter;
(iv) on the basis of procedures referred to in such letter, nothing
caused them to believe that the unaudited condensed pro forma financial
information contained in Sierra Pacific Power Company's Current Report
filed on Form 8-K on May 18, 2001 does not comply as to form in all
material respects with the accounting requirements of Rule 11-02 of
Regulation S-X applicable to pro forma condensed balance sheets or that the
pro forma adjustments have not been properly applied to the historical
amounts in the compilation of such financial information or data; and
(v) in addition to their examination referred to in their report
contained in the Incorporated Documents, they have carried out certain
other specified procedures, not constituting an audit, with respect to the
dollar amounts, percentages, and other financial information, (in each case
to the extent that such dollar amounts, percentages and other financial
information, either directly or by analysis or computation, are derived
from general accounting records of the Company) which appear in the
Company's Annual Report on Form 10-K for the year 2000 in Item 1,
"Business", Item 6, "Selected Financial Data" and Item 7, "Management
Discussion and Analysis", in its Quarterly Reports on Form 10-Q for the
quarterly periods ended March 31 and June 30, 2001 in Item 2, "Management's
Discussion and Analysis of Financial Condition and Results of Operations",
in the press release filed with its Current Report on Form 8-K dated
August 3, 2001 and in the Prospectus under "The Company - Regulated
Business Segment Review", "Selected Consolidated Financial Data",
"Capitalization" and "Use of Proceeds" and have found such dollar amounts,
percentages and financial information to be in agreement with the
accounting records of the Company.
B-2
FORM OF LOCK-UP AGREEMENT FROM DIRECTORS AND OFFICERS
Exhibit C
August __, 2001
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated,
▇▇▇▇▇▇▇, Sachs & Co.
▇▇▇▇▇▇ Brothers, Inc.
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Re: PROPOSED PUBLIC OFFERING BY SIERRA PACIFIC RESOURCES
Dear Sirs:
The undersigned, a stockholder and an officer and/or director of Sierra
Pacific Resources, a Nevada corporation (the "Company"), understands that
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
("▇▇▇▇▇▇▇ ▇▇▇▇▇"), ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co., ▇▇▇▇▇▇ Brothers, Inc. and ▇.▇. ▇▇▇▇▇▇▇
& Sons, Inc. propose to enter into a Purchase Agreement (the "Purchase
Agreement") with the Company providing for the public offering of shares (the
"Securities") of the Company's common stock, par value $1.00 per share (the
"Common Stock"). In recognition of the benefit that such an offering will confer
upon the undersigned as a stockholder and an officer and/or director of the
Company, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the undersigned agrees with each
underwriter to be named in the Purchase Agreement that, during a period of 90
days from the date of the Purchase Agreement, the undersigned will not, without
the prior written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇, directly or indirectly, (i) 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 for
the sale of, or otherwise dispose of or transfer any shares of the Company's
Common Stock or any securities convertible into or exchangeable or exercisable
for Common Stock, whether now owned or hereafter acquired by the undersigned or
with respect to which the undersigned has or hereafter acquires the power of
disposition, or file any registration statement under the Securities Act of
1933, as amended, with respect to any of the foregoing or (ii) enter into any
swap or any other agreement or any transaction that transfers, in whole or in
part, directly or indirectly, the economic consequence of ownership of the
Common Stock, whether any such swap or transaction is to be settled by delivery
of Common Stock or other securities, in cash or otherwise.
Very truly yours,
Signature:
--------------------------------
Print Name:
-------------------------------
C-1