EXHIBIT 1
$200,000,000
▇. ▇. ▇▇▇▇▇▇▇ CORPORATION
5.875% Senior Notes
Due 2013
UNDERWRITING AGREEMENT
February 11, 2003
February 11, 2003
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇ INCORPORATED
As Representatives of the Several Underwriters
c/o Morgan ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs and Mesdames:
▇. ▇. ▇▇▇▇▇▇▇ Corporation, a Delaware corporation (the "Company"), proposes
to issue and sell to the several Underwriters named in Schedule I hereto (the
"Underwriters") $200,000,000 principal amount of its 5.875% Senior Notes due
2013 (the "Securities") to be issued pursuant to the provisions of an indenture
to be dated as of February 14, 2003, as supplemented by the First Supplemental
Indenture, to be dated as of February 14, 2003 (the "Indenture"), between the
Company and The Bank of New York, as Trustee (the "Trustee").
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-88920) and
pre-effective amendment no. 1 thereto covering the registration of the
securities of the Company, including the Securities, under the Securities Act of
1933, as amended (the "Securities Act"), including the related preliminary
prospectus or prospectuses, and the offering thereof from time to time in
accordance with Rule 415 of the rules and regulations of the Commission under
the Securities Act (the "Rules and Regulations") and the Company has filed such
post-effective amendments thereto as may be required prior to the execution of
this Agreement. Promptly after execution and delivery of this Agreement, the
Company will prepare and file a final prospectus and final prospectus supplement
in accordance with the provisions of paragraph (b) of Rule 424 of the Rules and
Regulations. Such registration statement, as amended, including the exhibits and
schedules thereto, if any, and the information, if any, deemed to be a part
thereof pursuant to Rule 430A(b) of the Rules and Regulations (the "Rule 430A
Information") is referred to herein as the "Registration Statement," and the
final prospectus and the final prospectus supplement relating to the offering of
the Securities, in the form first furnished to the Underwriters by the Company
for use in connection with the offering of the Securities, are collectively
referred to herein as the "Prospectus;" provided, however, that all references
to the "Registration Statement" and the "Prospectus" shall be deemed to include
all documents incorporated therein by reference pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), prior to the execution of
this Agreement. A "preliminary prospectus" shall be deemed to refer to any
prospectus used before the applicable registration statement became effective
and any amendment or supplement thereto that omitted the Rule 430A Information
that was used after such effectiveness and prior to the execution and delivery
of the applicable underwriting agreement. For purposes of this Agreement, all
references to the Registration Statement, Prospectus or any preliminary
prospectus or to any amendment or supplement to any of them
shall be deemed to include any copy filed with the Commission pursuant to its
Electronic Data Gathering, Analysis and Retrieval System.
1. Representations and Warranties. The Company represents and warrants to
and agrees with each of the Underwriters that:
(a) The Registration Statement has become effective; no stop order
suspending the effectiveness of the Registration Statement is in effect,
and no proceedings for such purpose are pending before or, to the knowledge
of the Company, threatened by the Commission.
(b) On the effective date of the Registration Statement, such
Registration Statement conformed in all respects to the requirements of the
Securities Act and the Rules and Regulations and did not include any untrue
statement of a material fact or omit to state any material fact required to
be stated therein or necessary to make the statements therein not
misleading, and on the date of this Agreement, the Registration Statement
and the Prospectus will conform in all respects to the requirements of the
Securities Act and the Rules and Regulations; the Prospectus does not
include and will not include any untrue statement of a material fact or
omit to state any material fact required to be stated therein, in light of
the circumstances under which they were made, or necessary to make the
statements therein not misleading, except that the foregoing does not apply
to (A) statements in or omissions from any of such documents based upon
written information furnished to the Company by any Underwriter through the
representatives or representatives of the Underwriters, if any
("Representatives"), specifically for use therein or (B) that part of the
Registration Statement that constitutes the Statement of Eligibility (Form
T-1) under the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"), of the Trustee; and the documents incorporated by
reference in the Prospectus, at the time they were, or hereafter, are filed
with the Commission, complied and, at any time when a prospectus relating
to the Securities is required to be delivered under the Securities Act in
connection with sales by any Underwriter or dealer, will comply as to form
in all material respects with the requirements of the Exchange Act and the
rules and regulations thereunder.
(c) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware, with
power and authority (corporate and other) to own its properties and conduct
its business as described in the Prospectus; and the Company is duly
qualified to do business as a foreign corporation in good standing in all
other jurisdictions in which its ownership or lease of property or the
conduct of its business requires such qualification, except in such
jurisdictions where the failure to be so qualified would not individually
or in the aggregate have a material adverse effect on the condition
(financial or other), business, properties or results of operations of the
Company and its subsidiaries taken as a whole ("Material Adverse Effect").
(d) Each Significant Subsidiary (as defined below) of the Company has
been duly incorporated and is an existing corporation in good standing
under the laws of the jurisdiction of its incorporation, with power and
authority (corporate and other) to own its
2
properties and conduct its business as described in the Prospectus; and
each Significant Subsidiary of the Company is, to the extent applicable,
duly qualified to do business as a foreign corporation in good standing in
all other jurisdictions in which its ownership or lease of property or the
conduct of its business requires such qualification, except where the
failure to be so qualified would not individually or in the aggregate have
a Material Adverse Effect; all of the issued and outstanding capital stock
of each Significant Subsidiary of the Company has been duly authorized and
validly issued and is fully paid and nonassessable; and the capital stock
of each Significant Subsidiary owned by the Company, directly or through
subsidiaries, is owned free from liens, encumbrances and defects. As used
herein, "Significant Subsidiaries" means Berkley Regional Insurance
Company, Berkley Insurance Company, Admiral Insurance Company and Nautilus
Insurance Company, which are currently the only operating insurance
companies that are "significant subsidiaries" of the Company as that term
is defined in Rule 1-02(w) of Regulation S-X of the Rules and Regulations.
(e) The Indenture has been duly qualified under the Trust Indenture
Act and has been duly authorized, and on the Closing Date (as defined
below) will be duly executed and delivered by the Company and a valid and
binding Agreement of the Company, enforceable in accordance with its terms
except as (i) the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally and (ii)
rights of acceleration and the availability of equitable remedies may be
limited by equitable principles of general applicability.
(f) The Securities have been duly authorized and, when executed and
authenticated in accordance with the provisions of the Indenture and
delivered to and paid for by the Underwriters in accordance with the terms
of this Agreement on the Closing Date, such Securities will be duly
executed, authenticated, issued and delivered and entitled to the benefits
of the Indenture and will be valid and binding obligations of the Company,
enforceable in accordance with their terms except as (i) the enforceability
thereof may be limited by bankruptcy, insolvency or similar laws affecting
creditors' rights generally and (ii) rights of acceleration and the
availability of equitable remedies may be limited by equitable principles
of general applicability; and the Securities and the Indenture will conform
to the descriptions thereof in the Prospectus.
(g) Except as disclosed in the Prospectus, there are no contracts,
agreements or understandings between the Company and any person that would
give rise to a valid claim against the Company or any Underwriter for a
brokerage commission, finder's fee or other like payment in connection with
this offering.
(h) There are no contracts, agreements or understandings between the
Company and any person granting such person the right to require the
Company to file a registration statement under the Securities Act with
respect to any securities of the Company owned or to be owned by such
person or to require the Company to include such securities in the
securities registered pursuant to the Registration Statement or in any
securities being registered pursuant to any other registration statement
filed by the Company under the Securities Act.
3
(i) No consent, approval, authorization, or order of, or filing with,
any governmental agency or body or any court is required for the
performance by the Company of its obligations under this Agreement, the
Indenture or the Securities, except such as have been obtained and made
under the Securities Act, as contemplated under Section 5(a) hereof, and
such as may be required under state securities laws.
(j) The execution and delivery of, and the performance by the Company
of its obligations under, this Agreement, the Indenture and the Securities
will not result in a breach or violation of any of the terms and provisions
of, or constitute a default under, any statute, any rule, regulation or
order of any governmental agency or body or any court, domestic or foreign,
having jurisdiction over the Company or any Significant Subsidiaries of the
Company or any of their material properties, or any material agreement or
instrument to which the Company or any such subsidiary is a party or by
which the Company or any such subsidiary is bound or to which any of the
properties of the Company or any such subsidiary is subject, or the charter
or by-laws of the Company or any such subsidiary, and the Company has full
power and authority to authorize, issue and sell the Securities as
contemplated by this Agreement.
(k) This Agreement has been duly authorized, executed and delivered by
the Company.
(l) Except as disclosed in the Prospectus, the Company and its
Significant Subsidiaries have good and marketable title to all real
properties and all other properties and assets owned by them, in each case
free from liens, encumbrances and defects that would affect the value
thereof or interfere with the use made or to be made thereof by them, other
than liens, encumbrances and defects that would not individually or in the
aggregate have a Material Adverse Effect; and except as disclosed in the
Prospectus, the Company and its subsidiaries hold any leased real or
personal property under valid and enforceable leases with no exceptions
that would individually or in the aggregate have a Material Adverse Effect.
(m) The Company and its Significant Subsidiaries possess adequate
certificates, authorities or permits issued by appropriate governmental
agencies or bodies necessary to conduct the business now operated by them
and have not received any notice of proceedings relating to the revocation
or modification of any such certificate, authority or permit that, if
determined adversely to the Company or any of its Significant Subsidiaries,
would individually or in the aggregate have a Material Adverse Effect.
(n) The Company has made all required filings under applicable
insurance holding company statutes, and has received approvals of
acquisition of control and/or affiliate transactions, in each jurisdiction
in which such filings or approvals are required, except where the failure
to have made such filings or receive such approvals in any such
jurisdiction would not have individually or in the aggregate a Material
Adverse Effect; each of the Company's Significant Subsidiaries that is
required to be organized and licensed as an insurance or reinsurance
company (the "Insurance Subsidiaries") in its jurisdiction of incorporation
is duly organized and licensed as an insurance or reinsurance company in
its respective jurisdiction of incorporation, and each such Significant
4
Subsidiary is duly licensed or authorized as an insurer or reinsurer (the
"Insurance Licenses") in each other jurisdiction in which such licensing or
authorization is required, except where the failure to be so licensed or
authorized in any such jurisdiction would not have individually or in the
aggregate a Material Adverse Effect; there is no pending or, to the
knowledge of the Company, threatened action, suit, proceeding or
investigation that would reasonably be expected to lead to the revocation,
termination or suspension of any such Insurance Licenses, the revocation,
termination or suspension of which would have individually or in the
aggregate a Material Adverse Effect; and except as disclosed in the
Prospectus, no insurance regulatory agency or body has issued any order or
decree impairing, restricting or prohibiting the payment of dividends of
any Company subsidiary to its respective parent which would have
individually or in the aggregate a Material Adverse Effect.
(o) The Company and each of its Significant Subsidiaries is in
compliance with the requirements of all laws, ordinances, governmental
rules or regulations or court decrees to which it may be subject, and has
filed all notices, reports, documents or other information required to be
filed thereunder, except where the failure to so comply or file would not
individually or in the aggregate have a Material Adverse Effect.
(p) Except as disclosed in the Prospectus, neither the Company nor any
of its Insurance Subsidiaries is in violation of, or in default in the
performance, observance or fulfillment of, any obligation, agreement,
covenant or condition contained in reinsurance treaties, contracts,
agreements and arrangements to which the Company or any of its Insurance
Subsidiaries is a party, except for such violations or defaults which would
not individually or in the aggregate have a Material Adverse Effect;
neither the Company nor any of its Insurance Subsidiaries has received any
notice from any of the other parties to such treaties, contracts,
agreements or arrangements that such other party intends not to perform its
obligations thereunder and none of them has any reason to believe that any
of the other parties to such treaties, contracts, agreements or
arrangements will be unable to perform its obligations thereunder, except
to the extent that such nonperformance would not individually or in the
aggregate have a Material Adverse Effect.
(q) To the knowledge of the Company and its Insurance Subsidiaries, no
change in any insurance law or regulation is pending that would reasonably
be expected to have individually or in the aggregate a Material Adverse
Effect, except as described in the Prospectus.
(r) No labor dispute with the employees of the Company or any
Significant Subsidiary exists or, to the knowledge of the Company, is
imminent that would reasonably be expected to have individually or in the
aggregate a Material Adverse Effect.
(s) The Company and its subsidiaries own, possess or can acquire on
reasonable terms, adequate trademarks, trade names and other rights to
inventions, know-how, patents, copyrights, confidential information and
other intellectual property (collectively, "intellectual property rights")
necessary to conduct the business now operated by them and have not
received any notice of infringement of or conflict with asserted rights of
5
others with respect to any intellectual property rights that, if determined
adversely to the Company or any of its subsidiaries, would individually or
in the aggregate have a Material Adverse Effect.
(t) Except as disclosed in the Prospectus, neither the Company nor any
of its subsidiaries is in violation of any statute, any rule, regulation,
decision or order of any governmental agency or body or any court, domestic
or foreign, relating to the use, disposal or release of hazardous or toxic
substances or relating to the protection or restoration of the environment
or human exposure to hazardous or toxic substances (collectively,
"environmental laws"), owns or operates any real property contaminated with
any substance that is subject to any environmental laws, is liable for any
off-site disposal or contamination pursuant to any environmental laws, or
is subject to any claim relating to any environmental laws, which
violation, contamination, liability or claim would individually or in the
aggregate have a Material Adverse Effect; and the Company is not aware of
any pending investigation which would reasonably be expected to lead to
such a claim.
(u) Except as disclosed in the Prospectus, there are no pending
actions, suits or proceedings against or affecting the Company, any of its
subsidiaries or any of their respective properties that would individually
or in the aggregate have a Material Adverse Effect, or would materially and
adversely affect the ability of the Company to perform its obligations
under this Agreement; and no such actions, suits or proceedings are, to the
Company's knowledge, threatened or contemplated.
(v) KPMG LLP, who have certified the financial statements and
supporting schedules of the Company and its subsidiaries contained in the
Prospectus, are independent public accountants within the meaning of the
Securities Act and the Rules and Regulations; except as disclosed in the
Prospectus, the financial statements included or incorporated by reference
in the Registration Statement and the Prospectus present fairly the
financial position of the Company and its consolidated subsidiaries as of
the dates shown and their results of operations and cash flows for the
periods shown; except as disclosed in the Prospectus, such financial
statements have been prepared in conformity with the generally accepted
accounting principles in the United States applied on a consistent basis;
except as disclosed in the Prospectus, the schedules included or
incorporated in the Registration Statement present fairly the information
required to be stated therein; and except as disclosed in the Prospectus,
the Company and its Insurance Subsidiaries have made no material change in
their insurance reserving practices since the most recent audited financial
statements included in the Prospectus.
(w) The statutory annual and quarterly statements of the Insurance
Subsidiaries required to file such statutory statements and the statutory
balance sheets and income statements included in such statutory annual and
quarterly statements, most recently filed in each jurisdiction, have been
prepared in conformity with required or permitted or prescribed statutory
accounting principles or practices applied on a consistent basis, except as
may otherwise be indicated in the notes thereto, and present fairly the
financial position of the Insurance Subsidiaries (on a statutory basis) for
the period covered thereby.
6
(x) The Company and its subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or
specific authorizations; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with United States
generally accepted accounting principles and to maintain asset
accountability; (iii) access to assets is permitted only in accordance with
management's general or specific authorization; and (iv) the recorded
accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(y) Except as disclosed in the Prospectus, since the date of the
latest audited financial statements included in the Prospectus, (i) there
has been no material adverse change, nor any development or event involving
a prospective material adverse change, in the condition (financial or
other), business, properties or results of operations of the Company and
its subsidiaries taken as a whole, (ii) there have not been any
transactions entered into by the Company or any of its subsidiaries other
than in the ordinary course of business which are material to the Company
and its subsidiaries taken as a whole, and, (iii) there has been no
dividend or distribution of any kind declared, paid or made by the Company
on any class of its capital stock.
(z) The Company is not and, after giving effect to the offering and
sale of the Securities and the application of the proceeds thereof as
described in the Prospectus, will not be an "investment company" as defined
in the Investment Company Act of 1940.
2. Agreements to Sell and Purchase. The Company hereby agrees to sell to
the several Underwriters, and each Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees, severally and not jointly, to purchase from the
Company the respective principal amount of Securities set forth in Schedule I
hereto opposite its name at 98.420% of their principal amount (the "Purchase
Price") plus accrued interest, if any, from February 14, 2003 to the date of
payment and delivery.
3. Terms of Public Offering. The Company is advised by you that the
Underwriters propose to make a public offering of their respective portions of
the Securities as soon after the Registration Statement and this Agreement have
become effective as in your judgment is advisable. The Company is further
advised by you that the Securities are to be offered to the public initially at
99.070% of their principal amount (the "Public Offering Price") plus accrued
interest, if any, from February 14, 2003 to the date of payment and delivery and
to certain dealers selected by you at a price that represents a concession not
in excess of 0.40% of their principal amount under the Public Offering Price,
and that any Underwriter may allow, and such dealers may reallow, a concession
to certain other dealers not to exceed 0.25% of the principal amount of the
Securities.
4. Payment and Delivery. Payment for the Securities shall be made to the
Company in Federal or other funds immediately available in New York City against
delivery of such Securities at 9:00 a.m., New York City time, on February 14,
2003, or at such other time on the same or such other date, not later than
February 21, 2003, as shall be designated in writing by you. The time and date
of such payment are hereinafter referred to as the "Closing Date."
7
Certificates for the Securities shall be in global form and registered in
such names and in such denominations as you shall request in writing not later
than one full business day prior to the Closing Date. The certificates
evidencing the Securities shall be delivered to you on the Closing Date for the
respective accounts of the several Underwriters, with any transfer taxes payable
in connection with the transfer of the Securities to the Underwriters duly paid,
against payment of the Purchase Price therefor plus accrued interest, if any, to
the date of payment and delivery.
5. Covenants of the Company. In further consideration of the agreements of
the Underwriters herein contained, the Company covenants with each Underwriter
as follows:
(a) The Company will file the Prospectus with the Commission pursuant
to and in accordance with Rule 424(b) not later than the second business
day following the execution and delivery of this Agreement.
(b) The Company will advise ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated promptly
of any proposal to amend or supplement the Registration Statement or the
Prospectus and will afford ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated a reasonable
opportunity to comment on any such proposed amendment or supplement;
provided, however, the Company shall not file any such proposed amendment
or supplement to which ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated reasonably
objects; and the Company will also advise ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
promptly of the filing of any such amendment or supplement and of the
institution by the Commission of any stop order proceedings in respect of
the Registration Statement or of any part thereof and will use its best
efforts to prevent the issuance of any such stop order and to obtain as
soon as possible its lifting, if issued.
(c) If, at any time when a prospectus relating to the Securities as in
the opinion of counsel for the Underwriters is required to be delivered
under the Securities Act in connection with sales by any Underwriter or
dealer, any event occurs as a result of which the Prospectus as then
amended or supplemented would include an untrue statement of a material
fact or omit to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, or if for any other reason it shall be necessary during the
same period to amend or supplement the Prospectus or to file under the
Exchange Act any document incorporated by reference in the Prospectus in
order to comply with the provisions of the Securities Act, the Exchange Act
or the Trust Indenture Act, the Company promptly will notify ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
& Co. Incorporated of such event, and if such event shall occur or if, in
the opinion of counsel for the Underwriters, it is necessary at any time to
amend the Prospectus to comply with the Securities Act, the Company will
promptly prepare and file with the Commission, at its own expense, an
amendment or supplement which will correct such statement or omission or an
amendment which will effect such compliance. Neither ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated's consent to, nor the Underwriters' delivery of, any such
amendment or supplement shall constitute a waiver of any of the conditions
set forth in Section 6 hereof.
(d) As soon as practicable, but not later than 16 months, after the
date of this Agreement, the Company will make generally available to its
securityholders an earnings statement covering a period of at least 12
months beginning after the later of (i) the
8
effective date of the registration statement relating to the Securities,
(ii) the effective date of the most recent post-effective amendment to the
Registration Statement to become effective prior to the date of this
Agreement and (iii) the date of the Company's most recent Annual Report on
Form 10-K filed with the Commission prior to the date of this Agreement,
which will satisfy the provisions of Section 11(a) of the Securities Act.
(e) The Company will furnish to the Representatives copies of the
Registration Statement, including all exhibits, any related preliminary
prospectus, any related preliminary prospectus supplement, the Prospectus
and all amendments and supplements to such documents, in each case prior to
3:00 P.M. New York City time on the business day next succeeding the date
of this Agreement or as soon as possible, with respect to any amendment or
supplement, during the period mentioned in Section 5(c) above and in such
quantities as ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated reasonably requests. The
Company will pay the expenses of printing and distributing to the
Underwriters all such documents.
(f) The Company will arrange for the qualification of the Securities
for sale under the laws of such jurisdictions as ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated reasonably designates and will continue such qualifications in
effect so long as required for the distribution; provided, that in
connection therewith the Company shall not be required to qualify to do
business in any jurisdiction or to file or consent or otherwise subject
itself to service of process or taxation in any jurisdiction where it is
not already so subject.
(g) During the period of five years hereafter, the Company will
furnish to the Representatives and, upon request, to each of the other
Underwriters, as soon as practicable after the end of each fiscal year, a
copy of its annual report to stockholders for such year; and the Company
will furnish to the Representatives (i) as soon as available, a copy of
each report and any definitive proxy statement of the Company filed with
the Commission under the Exchange Act or mailed to stockholders, and (ii)
from time to time, such other information concerning the Company as ▇▇▇▇▇▇
▇▇▇▇▇▇▇ & Co. Incorporated may reasonably request.
(h) Whether or not the transactions contemplated in this Agreement are
consummated or this Agreement is terminated, to pay or cause to be paid all
expenses incident to the performance of its obligations under this
Agreement, including: (i) the fees, disbursements and expenses of the
Company's counsel and the Company's accountants in connection with the
registration and delivery of the Securities under the Securities Act and
all other fees or expenses in connection with the preparation and filing of
the Indenture, the Registration Statement, any preliminary prospectus, the
Prospectus and amendments and supplements to any of the foregoing,
including all printing costs associated therewith, and the mailing and
delivering of copies thereof to the Underwriters and dealers, in the
quantities hereinabove specified, (ii) all costs and expenses related to
the transfer and delivery of the Securities to the Underwriters, including
any transfer or other taxes payable thereon, (iii) the cost of printing
certificates representing the Securities, (iv) any fees charged by
securities rating services for rating the Securities, (v) the fees and
expenses of the Trustee and any agent of the Trustee and the fees and
disbursements of counsel for the Trustee in connection with the Indenture
and the
9
Securities, (vi) travel and lodging expenses of officers and employees of
the Company for any "road show" undertaken in connection with the marketing
of the offering of the Securities, and one-half of the cost of any aircraft
chartered in connection with the road show, and (vii) all other costs and
expenses incident to the performance of the obligations of the Company
hereunder for which provision is not otherwise made in this Section. It is
understood, however, that except as provided in this Section, Section 7
entitled "Indemnity and Contribution", and the last paragraph of Section 9
below, the Underwriters will pay all of their costs and expenses, including
fees and disbursements of their counsel, transfer taxes payable on resale
of any of the Securities by them and any advertising expenses connected
with any offers they may make.
6. Conditions to the Underwriters' Obligations. The obligations of the
Company to sell the Securities to the Underwriters and the several obligations
of the Underwriters to purchase and pay for the Securities on the Closing Date
are subject to the following conditions:
(a) The Prospectus shall have been filed with the Commission in
accordance with the Rules and Regulations and Section 5(a) of this
Agreement. No stop order suspending the effectiveness of the Registration
Statement or of any part thereof shall have been issued and no proceedings
for that purpose shall have been instituted or, to the knowledge of the
Company or any Underwriter, shall be contemplated by the Commission.
(b) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor shall any
notice have been given of any intended or potential downgrading or of
any review for a possible change that does not indicate the direction
of the possible change, in the rating accorded any of the Company's
securities by ▇▇▇▇▇'▇ Investors Service, Inc. or Standard & Poor's
Ratings Group, a division of McGraw Hill, Inc.; and
(ii) there shall not have occurred any change, or any development
involving a prospective change, in the condition, financial or
otherwise, or in the earnings, business or operations of the Company
and its subsidiaries, taken as a whole, from that set forth in the
Prospectus (exclusive of any amendments or supplements thereto
subsequent to the date of this Agreement) that, in your judgment, is
material and adverse and that makes it, in your judgment,
impracticable to market the Securities on the terms and in the manner
contemplated in the Prospectus.
(c) The Underwriters shall have received on the Closing Date an
opinion of ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, outside counsel for the Company, dated
the Closing Date, to the effect that:
(i) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware;
10
(ii) The Company has corporate power and authority to own, lease
and operate its properties and to conduct its business as described in
the Registration Statement;
(iii) The Indenture has been duly qualified under the Trust
Indenture Act, has been duly authorized, executed and delivered by the
Company and is a valid and binding agreement of the Company,
enforceable in accordance with its terms except as (A) the
enforceability thereof may be limited by bankruptcy, insolvency or
similar laws affecting creditors' rights generally and (B) rights of
acceleration and the availability of equitable remedies may be limited
by equitable principles of general applicability;
(iv) The Securities have been duly authorized by all necessary
corporate action and, executed, authenticated, issued and delivered
and entitled to the benefits of the Indenture and are valid and
binding obligations of the Company, enforceable in accordance with
their terms except as (A) the enforceability thereof may be limited by
bankruptcy, insolvency or similar laws affecting creditors' rights
generally and (B) rights of acceleration and the availability of
equitable remedies may be limited by equitable principles of general
applicability; and the Securities and the Indenture conform in all
material respects to the descriptions thereof contained in the
Prospectus;
(v) No consent, approval, authorization or order of, or filing
with, any governmental agency or body or any court is required for the
consummation of the transactions contemplated by this Agreement in
connection with the issuance or sale of the Securities by the Company,
except such as have been obtained and made under the Securities Act
and such as may be required under state securities and insurance laws,
and the execution and delivery of this Agreement and the consummation
of the transactions herein contemplated will not conflict with or
constitute a breach of, or default under, the certificate of
incorporation or by-laws of the Company;
(vi) The Registration Statement has become effective under the
Securities Act, the Prospectus was filed with the Commission pursuant
to the subparagraph of Rule 424(b) specified in such opinion on the
date specified therein, and, to the best of the knowledge of such
counsel, no stop order suspending the effectiveness of the
Registration Statement or any part thereof has been issued and no
proceedings for that purpose have been instituted or are pending or
contemplated under the Securities Act, and the Registration Statement
and the Prospectus (but not including the Form T-1 heretofore referred
to or any document incorporated by reference in the Registration
Statement or the Prospectus), as of the date of this Agreement, and
any amendment or supplement thereto, and as of its date, complied as
to form in all material respects with the requirements of the
Securities Act and the Rules and Regulations; it being understood that
such counsel need express no opinion as to the financial statements or
other financial data contained in the Registration Statement or the
Prospectus;
11
(vii) This Agreement has been duly authorized, executed and
delivered by the Company;
(viii) The information in the Prospectus under the captions
"Description of the Debt Securities," "Description of Notes," "Plan of
Distribution" and "Underwriters," to the extent that such information
is applicable to the Securities and constitutes matter of law or legal
conclusions or descriptions of documents referred to therein, has been
reviewed by such counsel and is correct in all material respects; and
(ix) The Company is not and, after giving effect to the offering
and sale of the Securities and the application of the proceeds thereof
as described in the Prospectus, will not be an "investment company" as
defined in the Investment Company Act of 1940.
The opinion of ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ described in this Section 6(c)
above shall be rendered to the Underwriters at the request of the Company and
shall so state therein.
In rendering such opinions, such counsel may state that (i) its opinion is
limited to matters governed by the Federal laws of the United States of America,
the laws of the State of New York and the corporate law of the State of Delaware
and (ii) it has relied, as to matters of fact and to the extent it deems proper,
on certificates of responsible officers of the Company or public officials. In
addition to the matters set forth above, such counsel shall state that it has no
reason to believe that the Registration Statement, as of the date of this
Agreement or as of the Closing Date, or any amendment thereto, as of its date or
as of the Closing Date, contained any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or necessary to
make the statements therein not misleading or that the Prospectus, as of the
date of this Agreement or as of such Closing Date, or any amendment or
supplement thereto, as of its date or as of the Closing Date, contained any
untrue statement of a material fact or omitted to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; it being understood
that such counsel need express no view as to (A) the financial statements or
other financial data contained in the Registration Statement or the Prospectus
and (B) that part of the Registration Statement that constitutes the Form T-1
heretofore referred to.
(d) The Underwriters shall have received on the Closing Date an
opinion of ▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Senior Vice President - General Counsel and
Secretary of the Company, dated the Closing Date, to the effect that:
(i) The Company has an authorized capitalization as is set forth
in the Prospectus;
(ii) The Company is duly qualified to do business as a foreign
corporation in good standing in all other jurisdictions in which its
ownership or lease of property or the conduct of its business requires
such qualification, except where
12
the failure to be so qualified would not individually or in the
aggregate have a Material Adverse Effect;
(iii) Each Significant Subsidiary of the Company has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of its jurisdiction of incorporation, has the corporate
power and authority to own, lease and operate its properties and to
conduct the business described in the Registration Statement and, to
the extent applicable, is duly qualified as a foreign corporation to
transact business and is in good standing as such in each jurisdiction
in which it owns or leases substantial properties or in which the
conduct of its business requires such qualification (except in such
jurisdictions where the failure to be so qualified would not
individually or in the aggregate have a Material Adverse Effect) (such
counsel may note in his opinion that insurance laws of certain of such
jurisdictions where the Significant Subsidiaries hold an insurance
license do not require such due qualification as a foreign
corporation); except as set forth in the Registration Statement, all
of the issued and outstanding shares of capital stock of each
Significant Subsidiary have been duly authorized and validly issued
and are owned directly or indirectly by the Company, free and clear of
any pledges, liens, encumbrances, claims or equities; and all such
shares are fully paid and nonassessable;
(iv) There are no contracts, agreements or understandings known
to such counsel between the Company and any person granting such
person the right to require the Company to file a registration
statement under the Securities Act with respect to any securities of
the Company owned or to be owned by such person or to require the
Company to include such securities in the securities registered
pursuant to the Registration Statement or in any securities being
registered pursuant to any other registration statement filed by the
Company under the Securities Act;
(v) To the best of such counsel's knowledge, there are no
licenses, franchises, contracts, indentures, mortgages, loan
agreements, notes, leases or other instruments required to be
described in the Registration Statement or to be filed as an exhibit
thereto other than those described therein or filed or incorporated by
reference as exhibits thereto;
(vi) The execution and delivery of , and the performance by the
Company of its obligations under, this Agreement, the Indenture and
the Securities will not result in a breach or violation of any of the
terms and provisions of, or constitute a default under, any statute,
any rule, regulation or order of any governmental agency or body or
any court having jurisdiction over the Company or any Significant
Subsidiary of the Company or the charter or by-laws of any such
subsidiary, or, to the best of such counsel's knowledge, any of their
material properties, or any material agreement, contract, indenture,
mortgage, loan agreement, note, lease or other instrument to which the
Company or any such subsidiary is a party or by which the Company or
any such subsidiary is bound or to which any of the properties of the
Company or any such subsidiary is subject;
13
(vii) The Company has made all required filings under applicable
insurance holding company statutes, and has received approvals of
acquisition of control and/or affiliate transactions, in each
jurisdiction in which such filings or approvals are required, except
where the failure to have made such filings or receive such approvals
in any such jurisdiction would not reasonably be expected to have
individually or in the aggregate a Material Adverse Effect; each of
the Insurance Subsidiaries is duly organized and licensed as an
insurance or reinsurance company in its respective jurisdiction of
incorporation, and each such Insurance Subsidiary owns the Insurance
Licenses in each other jurisdiction in which such licensing or
authorization is required, except where the failure to be so licensed
or authorized in any such jurisdiction would not reasonably be
expected to have individually or in the aggregate a Material Adverse
Effect; there is no pending or, to the best of such counsel's
knowledge, threatened action, suit, proceeding or investigation that
would be reasonably likely to lead to the revocation, termination or
suspension of any such Insurance Licenses, the revocation, termination
or suspension of which would reasonably be expected to have
individually or in the aggregate a Material Adverse Effect; and except
as disclosed in the Prospectus, no insurance regulatory agency or body
has issued any order or decree impairing, restricting or prohibiting
the payment of dividends of any Company subsidiary to its respective
parent which would reasonably be expected to have individually or in
the aggregate a Material Adverse Effect;
(viii) Except as would not individually or in the aggregate have
a Material Adverse Effect and except as described in the Prospectus,
(i) to the best of such counsel's knowledge, there are no legal or
governmental proceedings pending or threatened which are required to
be disclosed in the Registration Statement, other than those disclosed
therein, and (ii) there are no pending legal or governmental
proceedings, to the best of such counsel's knowledge, to which the
Company or any subsidiary is a party or of which any of their property
is the subject which are not described in the Registration Statement
but are required to be so described in the Registration Statement,
including ordinary routine litigation incidental to the business;
(ix) The documents incorporated by reference in the Prospectus
pursuant to Item 12 of Form S-3 under the Securities Act (other than
the financial statements, supporting schedules and other financial
information included or incorporated by reference therein, as to which
no opinion need to be rendered), at the time they were filed with the
Commission or delivered to the security holders, as the case may be,
complied as to form in all material respects with the requirements of
the Exchange Act and the rules and regulations thereunder; and
(x) The descriptions in the Registration Statement and Prospectus
of legal and governmental proceedings and contracts and other
documents are accurate in all material respects and fairly present the
information required to be shown; and, to the best of such counsel's
knowledge, no stop order suspending the effectiveness of the
Registration Statement or any part thereof has been issued and
14
no proceedings for that purpose have been instituted or are pending or
contemplated under the Securities Act.
In rendering such opinions, such counsel may state that (i) its opinion is
limited to matters governed by the Federal laws of the United States of America,
the laws of the State of New York and the corporate law of the State of Delaware
and (ii) it has relied, as to matters of fact and to the extent it deems proper,
on certificates of responsible officers of the Company or public officials. In
addition to the matters set forth above, such counsel shall state that it has no
reason to believe that the Registration Statement, as of the date of this
Agreement or as of the Closing Date, or any amendment thereto, as of its date or
as of the Closing Date, contained any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or necessary to
make the statements therein not misleading or that the Prospectus, as of the
date of this Agreement or as of such Closing Date, or any amendment or
supplement thereto, as of its date or as of the Closing Date, contained any
untrue statement of a material fact or omitted to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; it being understood
that such counsel need express no view as to (A) the financial statements or
other financial data contained in the Registration Statement or the Prospectus
and (B) that part of the Registration Statement that constitutes the Form T-1
heretofore referred to.
(e) The Underwriters shall have received on the Closing Date an
opinion of LeBoeuf, Lamb, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, L.L.P., counsel for the
Underwriters, dated the Closing Date, with respect to the incorporation of
the Company, the execution and delivery of this Agreement, the
qualification, execution, delivery and enforceability of the Indenture, the
authorization, validity and enforceability of the Securities, the
Registration Statement, the Prospectus and other related matters as the
Representatives may require, and the Company shall have furnished to such
counsel such documents as they request for the purpose of enabling them to
pass upon such matters.
(f) The Underwriters shall have received on the Closing Date a
certificate, dated the Closing Date, of the President or any Vice President
and a principal financial or accounting officer of the Company in which
such officers, to the best of their knowledge and after reasonable
investigation, shall state that the representations and warranties of the
Company in this Agreement are true and correct, that the Company has
complied with all agreements and satisfied all conditions on its part to be
performed or satisfied hereunder at or prior to the Closing Date, that no
stop order suspending the effectiveness of the Registration Statement or of
any part thereof has been issued and no proceedings for that purpose have
been instituted or are contemplated by the Commission and that, subsequent
to the date of the most recent financial statements in the Prospectus, (i)
there has not occurred any downgrading, nor has any notice been given of
any intended or potential downgrading or any review for a possible change
that does not indicate the direction of the possible change, in the rating
accorded any of the Company's securities by ▇▇▇▇▇'▇ Investors Service, Inc.
or Standard & Poor's Ratings Group, a division of McGraw Hill, Inc., and
(ii) there has been no material adverse change, nor any development or
event involving a prospective material adverse change, in the condition
(financial or other), business, properties or results of operations of the
Company and its
15
subsidiaries taken as a whole except as set forth in or contemplated by the
Prospectus or as described in such certificate.
(g) The Underwriters shall have received on the Closing Date a letter
dated the day immediately preceding the Closing Date, in form and substance
agreed to by LeBoeuf, Lamb, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, L.L.P., counsel for the
Underwriters, from KPMG LLP, independent public accountants, containing
statements and information of the type ordinarily included in accountants'
"comfort letters" to underwriters with respect to the financial statements
and certain financial information contained in the Registration Statement
and the Prospectus, which letter shall use a "cut-off date" not earlier
than the date hereof.
7. Indemnity and Contribution. (a) The Company agrees to indemnify and
hold harmless each Underwriter, each person, if any, who controls any
Underwriter within the meaning of either Section 15 of the Securities Act
or Section 20 of the Exchange Act and each affiliate of any Underwriter
within the meaning of Rule 405 under the Securities Act from and against
any and all losses, claims, damages and liabilities (including, without
limitation, any legal or other expenses reasonably incurred in connection
with defending or investigating any such action or claim) caused by any
untrue statement or alleged untrue statement of a material fact contained
in the Registration Statement or any amendment thereof, any preliminary
prospectus or the Prospectus (as amended or supplemented if the Company
shall have furnished any amendments or supplements thereto), or caused by
any omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading, except insofar as such losses, claims, damages or liabilities
are caused by any such untrue statement or omission or alleged untrue
statement or omission based upon information relating to any Underwriter
furnished to the Company in writing by such Underwriter through you
expressly for use therein, it being understood and agreed that the only
such information furnished by any Underwriter consists of the information
described as such in subsection (b) below; provided, however, that the
foregoing indemnity agreement with respect to any preliminary prospectus
shall not inure to the benefit of any Underwriter from whom the person
asserting any such losses, claims, damages or liabilities purchased
Securities, or any person controlling such Underwriter, if a copy of the
Prospectus (as then amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) was not sent or given by
or on behalf of such Underwriter to such person, if required by law so to
have been delivered, at or prior to the written confirmation of the sale of
the Securities to such person, and if the Prospectus (as so amended or
supplemented) would have cured the defect giving rise to such losses,
claims, damages or liabilities, unless such failure is the result of
noncompliance by the Company with Section 5(e) hereof.
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign the
Registration Statement and each person, if any, who controls the Company
within the meaning of either Section 15 of the Securities Act or Section 20
of the Exchange Act to the same extent as the foregoing indemnity from the
Company to such Underwriter, but only with reference to information
relating to such Underwriter furnished to the Company in writing by such
16
Underwriter through you expressly for use in the Registration Statement,
any preliminary prospectus, the Prospectus or any amendments or supplements
thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may
be sought pursuant to Section 7(a) or 7(b), such person (the "indemnified
party") shall promptly notify the person against whom such indemnity may be
sought (the "indemnifying party") in writing and the indemnifying party,
upon request of the indemnified party, shall retain counsel reasonably
satisfactory to the indemnified party to represent the indemnified party
and any others the indemnifying party may designate in such proceeding and
shall pay the fees and disbursements of such counsel related to such
proceeding. In any such proceeding, any indemnified party shall have the
right to retain its own counsel, but the fees and expenses of such counsel
shall be at the expense of such indemnified party unless (i) the
indemnifying party and the indemnified party shall have mutually agreed to
the retention of such counsel or (ii) the named parties to any such
proceeding (including any impleaded parties) include both the indemnifying
party and the indemnified party and representation of both parties by the
same counsel would be inappropriate due to actual or potential differing
interests between them. It is understood that the indemnifying party shall
not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the fees and expenses of more than one separate
firm (in addition to any local counsel) for all such indemnified parties
and that all such fees and expenses shall be reimbursed as they are
incurred. Such firm shall be designated in writing by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated, in the case of parties indemnified pursuant to Section 7(a),
and by the Company, in the case of parties indemnified pursuant to Section
7(b). The indemnifying party shall not be liable for any settlement of any
proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party from and against any loss
or liability by reason of such settlement or judgment. Notwithstanding the
foregoing sentence, if at any time an indemnified party shall have
requested an indemnifying party to reimburse the indemnified party for fees
and expenses of counsel as contemplated by the second and third sentences
of this paragraph, the indemnifying party agrees that it shall be liable
for any settlement of any proceeding effected without its written consent
if (i) such settlement is entered into more than 30 days after receipt by
such indemnifying party of the aforesaid request and (ii) such indemnifying
party shall not have reimbursed the indemnified party in accordance with
such request prior to the date of such settlement. No indemnifying party
shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened proceeding in respect of which
any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such
settlement includes an unconditional release of such indemnified party from
all liability on claims that are the subject matter of such proceeding.
(d) To the extent the indemnification provided for in Section 7(a) or
7(b) is unavailable to an indemnified party or insufficient in respect of
any losses, claims, damages or liabilities referred to therein, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to
17
the amount paid or payable by such indemnified party as a result of such
losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the
one hand and the Underwriters on the other hand from the offering of the
Securities or (ii) if the allocation provided by clause 7(d)(i) above is
not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause 7(d)(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 that resulted in such losses, claims, damages or liabilities, 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 shall be deemed to
be in the same respective proportions as the net proceeds from the offering
of the Securities (before deducting expenses) received by the Company and
the total underwriting discounts and commissions received by the
Underwriters, in each case as set forth in the table on the cover of the
Prospectus, bear to the aggregate Public Offering Price of the Securities.
The relative fault of the Company on the one hand and the Underwriters on
the other hand shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to
information supplied by the Company or by the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Underwriters' respective
obligations to contribute pursuant to this Section 7 are several in
proportion to the respective principal amount of Securities they have
purchased hereunder, and not joint.
(e) The Company and the Underwriters agree that it would not be just
or 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 that does not take
account of the equitable considerations referred to in Section 7(d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or
claim. Notwithstanding the provisions of this Section 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
that such Underwriter has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
remedies provided for in this Section 7 are not exclusive and shall not
limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
(f) The indemnity and contribution provisions contained in this
Section 7 and the representations, warranties and other statements of the
Company contained in this Agreement shall remain operative and in full
force and effect regardless of (i) any
18
termination of this Agreement, (ii) any investigation made by or on behalf
of any Underwriter or any person controlling any Underwriter or by or on
behalf of the Company, its officers or directors or any person controlling
the Company and (iii) acceptance of and payment for any of the Securities.
8. Termination. This Agreement shall be subject to termination by notice
given by you to the Company, if: (a) after the execution and delivery of this
Agreement and prior to the Closing Date (i) trading generally shall have been
suspended or materially limited on or by, as the case may be, any of the New
York Stock Exchange, the American Stock Exchange the National Association of
Securities Dealers, Inc., (ii) trading of any securities of the Company shall
have been suspended on any exchange or in any over-the-counter market, (iii) a
material disruption in securities settlement, payment or clearance services in
the United States shall have occurred, (iv) any moratorium on commercial banking
activities in New York shall have been declared by either Federal or New York
State authorities, or (v) there shall have occurred any outbreak or escalation
of hostilities or, any change in financial markets or any calamity or crisis
that, in your judgment, is material and adverse; and (b) in the case of any of
the events specified in clauses 8(a)(i) through 8(a)(v), such event, singly or
together with any other such event, makes it, in your judgment, impracticable or
inadvisable to proceed with the offer, sale or delivery of the Securities on the
terms and in the manner contemplated in the Prospectus.
9. Effectiveness; Defaulting Underwriters. This Agreement shall become
effective upon the execution and delivery hereof by the parties hereto.
If, on the Closing Date, any one or more of the Underwriters shall fail or
refuse to purchase Securities that it has or they have agreed to purchase
hereunder on such date, and the aggregate principal amount of Securities which
such defaulting Underwriter or Underwriters agreed but failed or refused to
purchase is not more than one-tenth of the aggregate principal amount of the
Securities to be purchased on such date, the other Underwriters shall be
obligated severally in the proportions that the principal amount of Securities
set forth opposite their respective names in Schedule I bears to the aggregate
principal amount of Securities set forth opposite the names of all such
non-defaulting Underwriters, or in such other proportions as you may specify, to
purchase the Securities which such defaulting Underwriter or Underwriters agreed
but failed or refused to purchase on such date; provided, that in no event shall
the principal amount of Securities that any Underwriter has agreed to purchase
pursuant to this Agreement be increased pursuant to this Section 9 by an amount
in excess of one-ninth of such principal amount of Securities without the
written consent of such Underwriter. If, on the Closing Date, any Underwriter or
Underwriters shall fail or refuse to purchase Securities and the aggregate
principal amount of Securities with respect to which such default occurs is more
than one-tenth of the aggregate principal amount of Securities to be purchased,
and arrangements satisfactory to you and the Company for the purchase of such
Securities are not made within 36 hours after such default, this Agreement shall
terminate without liability on the part of any non-defaulting Underwriter or the
Company. In any such case either you or the Company shall have the right to
postpone the Closing Date, but in no event for longer than seven days, in order
that the required changes, if any, in the Registration Statement and in the
Prospectus or in any other documents or arrangements may be effected. Any action
taken under this paragraph shall not relieve any defaulting Underwriter from
liability in respect of any default of such Underwriter under this Agreement.
19
If this Agreement shall be terminated by the Underwriters, or any of them,
because of any failure or refusal on the part of the Company to comply with the
terms or to fulfill any of the conditions of this Agreement, or if for any
reason the Company shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
10. Notices. All communications hereunder will be in writing and, if sent
to the Underwriters, will be mailed, delivered or telegraphed and confirmed to
the Representatives, c/o Morgan ▇▇▇▇▇▇▇ & Co. Incorporated, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Finance Execution, or, if sent to the
Company, will be mailed, delivered or telegraphed and confirmed to it at address
and numbers of the Company set forth in the Registration Statement, Attention:
▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Senior Vice President - General Counsel and Secretary;
provided, however, that any notice to an Underwriter pursuant to Section 7 will
be mailed, delivered or telegraphed and confirmed to such Underwriter.
11. Counterparts. This Agreement may be signed in two or more counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.
12. Applicable Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York.
13. Headings. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
[Remainder of page intentionally left blank]
20
Very truly yours,
▇. ▇. ▇▇▇▇▇▇▇ CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
Title: Senior Vice President
Accepted as of the date hereof
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
Acting severally on behalf
of themselves and the
several Underwriters named
in Schedule I hereto
By: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Executive Director
21
SCHEDULE I
Principal Amount
of Securities
Underwriter To Be Purchased
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated $120,000,000
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated 80,000,000
------------
Total..................... $200,000,000
============