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EXHIBIT 1
SOUTHWESTERN XXXX TELEPHONE COMPANY
DEBT SECURITIES
UNDERWRITING AGREEMENT
November 18, 1997
To the Representative
named in Schedule I
hereto of the Underwriters
named in Schedule II hereto
Dear Sirs:
Southwestern Xxxx Telephone Company, a Missouri corporation (the
"Company"), may issue and sell from time to time series of its debt securities
registered under the registration statement referred to in Paragraph 1(a)
hereof ("Securities" and, individually, "Security"). The Securities will be
issued under an Indenture, dated as of February 1, 1985, as supplemented by the
First Supplemental Indenture, dated as of June 1, 1991 (together, the
"Indenture"), from the Company to The Bank of New York, as Trustee, in one or
more series, which series may vary as to interest rates, maturities, redemption
provisions and selling prices, with all such terms for any particular series
being determined at the time of sale. The Company proposes to sell to the
underwriters named in Schedule II hereto ("Underwriters") for whom you are
acting as representative ("Representative") a series of Securities, of the
designation, with the terms and in the aggregate principal amount specified in
Schedule I hereto ("Underwritten Securities" and, individually, "Underwritten
Security").
1. The Company represents and warrants to, and agrees with,
the several Underwriters that:
(a) Two registration statements on Form S-3 with respect to the
Securities have been prepared by the Company in conformity with the
requirements of the Securities Act of 1933, as amended ("Act" or
"Securities Act"), and the rules and regulations ("Rules and
Regulations") of the Securities and Exchange Commission ("Commission" or
"SEC") thereunder and have become effective. As used in this Agreement,
(i) "Registration Statement" means those registration statements (File
Nos. 33-49967 and 333-37515), as amended or supplemented to the date
hereof (including all documents incorporated therein by reference);
(ii) "Preliminary
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Prospectus" means each prospectus (including all documents incorporated
therein by reference) included in that Registration Statement, or
amendments thereto or supplements thereof, before it became effective
under the Act, including any prospectus filed with the Commission
pursuant to Rule 424(a) of the Rules and Regulations; (ii) "Basic
Prospectus" means the prospectus (including all documents incorporated
therein by reference) included in the Registration Statement; and (iv)
"Prospectus" means the Basic Prospectus, together with any prospectus
amendment or supplement (including in each case all documents
incorporated therein by reference) specifically relating to the
Underwritten Securities, as filed with, or mailed for filing to, the
Commission pursuant to paragraph (b) or (c) of Rule 424 of the Rules and
Regulations. The Commission has not issued any order preventing or
suspending the use of the Prospectus.
(b) The Registration Statement and each Prospectus contain, and
(in the case of any amendment or supplement to any such document, or any
material incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being made)
will contain at all times during the period specified in Paragraph 8(c)
hereof, all statements which are required by the Act, the Securities
Exchange Act of 1934, as amended ("Exchange Act"), the Trust Indenture
Act of 1939, as amended ("Trust Indenture Act"), and the rules and
regulations of the Commission under such Acts; the Indenture, including
any amendments and supplements thereto, pursuant to which the
Underwritten Securities will be issued, will conform with the
requirements of the Trust Indenture Act and the rules and regulations of
the Commission thereunder, and the Registration Statement and the
Prospectus do not, and (in the case of any amendment or supplement to
any such document, or any material incorporated by reference in any such
document, filed with the Commission after the date as of which this
representation is being made) will not at any time during the period
specified in Paragraph 8(c) hereof, contain 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;
provided that the Company makes no representation or warranty as to
information contained in or omitted from the Registration Statement or
the Prospectus in reliance upon and in conformity with information
furnished in writing to the Company through the Representative by or on
behalf of any Underwriter specifically for use therein, or as to any
statements in or omissions from the Statement of Eligibility of the
Trustee under the Indenture.
(c) The Company is not in violation of its corporate charter or
bylaws or in default under any agreement, indenture or instrument, the
effect of which violation or default would be material to the Company,
the execution, delivery and performance of this Agreement and any
Delayed Delivery Contracts (as defined in Paragraph 3 hereof) and
compliance by the Company with the provisions of the Underwritten
Securities and the Indenture will not conflict with, result in the
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creation or imposition of any lien, charge or encumbrance upon any of
the assets of Company pursuant to the terms of, or constitute a default
under, any agreement, indenture or instrument, or result in a violation
of the corporate charter or bylaws of the Company or any order, rule or
regulation of any court or governmental agency having jurisdiction over
the Company; and except as required by the Act, the Trust Indenture Act
and applicable state securities laws, no consent, authorization or order
of, or filing or registration with, any court or governmental agency is
required for the execution, delivery and performance of this Agreement,
the Delayed Delivery Contract, if any, and the Indenture.
(d) Except as described in or contemplated by the Registration
Statement and the Prospectus, there shall have not occurred any changes
or any development involving a prospective change, or affecting
particularly the business or properties of the Company or its
subsidiaries, which materially impairs the investment quality of the
Underwritten Securities since the dates as of which information is given
in the Registration Statement and the Prospectus.
(e) On the Delivery Date (as defined in Paragraph 7 hereof), (i)
the Indenture will have been duly authorized, executed and delivered by
the Company and will constitute the legally binding obligation of the
Company, enforceable in accordance with its terms, (ii) the Underwritten
Securities will have been duly authorized and, upon payment therefor as
provided in this Agreement, will constitute legally binding obligations
of the Company entitled to the benefits of the Indenture and (iii) the
Underwritten Securities and the Indenture will conform to the
descriptions thereof contained in the Prospectus.
(f) The Company has been duly incorporated, is validly existing
as a corporation in good standing under the laws of the State of
Missouri, with full corporate power and authority to own its properties
and conduct its business as described in the Prospectus, and is duly
qualified to do business as a foreign corporation and is in good
standing under the laws of each jurisdiction which requires such
qualification wherein it owns or leases properties or conducts business,
except where the failure to so qualify would not have a material adverse
effect on the Company.
(g) Except as described in the Prospectus, there is no material
litigation or governmental proceeding pending or, to the knowledge of
the Company, threatened against the Company which is reasonably expected
to result in any material adverse change in the financial condition,
results of operations, business or prospects of the Company or which is
required to be disclosed in the Registration Statement.
(h) The financial statements filed as part of the Registration
Statement or included in any Preliminary Prospectus or the Prospectus
present, or (in the case of
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any amendment or supplement to any such document, or any material
incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being made)
will present at all times during the period specified in Paragraph 8(c)
hereof, fairly, the financial condition and results of operations of the
Company, at the dates and for the periods indicated, and have been, and
(in the case of any amendment or supplement to any such document, or any
material incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being made)
will be at all times during the period specified in Paragraph 8(c)
hereof, prepared in conformity with generally accepted accounting
principles applied on a consistent basis throughout the periods involved
(except as described in the notes thereto).
(i) The documents incorporated by reference into any Preliminary
Prospectus or the Prospectus have been, and (in the case of any
amendment or supplement to any such document, or any material
incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being made)
will be, at all times during the period specified in Paragraph 8(c)
hereof, prepared by the Company in conformity with the applicable
requirements of the Act and the Rules and Regulations and the Exchange
Act and the rules and regulations of the Commission thereunder and such
documents have been, or (in the case of any amendment or supplement to
any such document, or any material incorporated by reference in any such
document, filed with the Commission after the date as of which this
representation is being made) will be at all times during the period
specified in Paragraph 8(c) hereof, timely filed as required thereby.
(j) There are no contracts or other documents which are required
to be filed as exhibits to the Registration Statement by the Act or by
the Rules and Regulations, or which were required to be filed as
exhibits to any document incorporated by reference in the Prospectus by
the Exchange Act or the rules and regulations of the Commission
thereunder, which have not been filed as exhibits to the Registration
Statement or to such document or incorporated therein by reference as
permitted by the Rules and Regulations or the rules and regulations of
the Commission under the Exchange Act as required.
(k) No order, consent, approval, authorization, registration or
qualification of or with any governmental agency or body having
jurisdiction over the Company or any of its properties is required for
the issue and sale of the Underwritten Securities or the consummation by
the Company of the transactions contemplated by this Agreement or the
Indenture, except such as have been, or will have been prior to the
Delivery Date, obtained under the Act and the Trust Indenture Act and
such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky
laws in connection with the purchase and distribution of the
Underwritten Securities by the Underwriters.
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2. Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Company agrees to
sell to each Underwriter, severally and not jointly, and each
Underwriter agrees, severally and not jointly, to purchase from the
Company, at the purchase price and on the other terms set forth in
Schedule I hereto, the principal amount of the Underwritten Securities
set forth opposite its name in Schedule II hereto.
3. Any offer to purchase Underwritten Securities by institutional
investors solicited by the Underwriters for delayed delivery shall be
made pursuant to contracts substantially in the form of Exhibit A
attached hereto, with such changes therein as the Company and the
Representative may approve ("Delayed Delivery Contracts"). The Company
shall have the right, in its sole discretion, to approve or disapprove
each such institutional investor. Underwritten Securities which are
subject to Delayed Delivery Contracts are herein sometimes called
"Delayed Delivery Underwritten Securities" and Underwritten Securities
which are not subject to Delayed Delivery Contracts are herein sometimes
called "Immediate Delivery Underwritten Securities."
Contemporaneously with the purchase on the Delivery Date by the
Underwriters of the Immediate Delivery Underwritten Securities pursuant to this
Agreement, the Company will pay to the Representative, for the account of the
Underwriters, the compensation specified in Schedule I hereto for arranging the
sale of Delayed Delivery Underwritten Securities. The Underwriters shall have
no responsibility with respect to the validity or performance of any Delayed
Delivery Contracts.
For the purpose of determining the principal amount of Immediate
Delivery Underwritten Securities to be purchased by each Underwriter, there
shall be deducted from the principal amount of Underwritten Securities to be
purchased by such Underwriter as set forth in Schedule II hereto that portion
of the aggregate principal amount of Delayed Delivery Underwritten Securities
that the principal amount of Underwritten Securities to be purchased by such
Underwriter as set forth in Schedule II hereto bears to the aggregate principal
amount of Underwritten Securities set forth therein to be purchased by all of
the Underwriters (in each case as adjusted by the Representative to avoid
fractions of the minimum principal amount in which the Underwritten Securities
may be issued), except to the extent that the Representative determines, in its
discretion, that such deduction shall be otherwise than in such proportion and
so advises the Company.
4. [Reserved]
5. The Company shall not be obligated to deliver any Underwritten
Securities except upon payment for all Immediate Delivery Underwritten
Securities to be purchased pursuant to this Agreement as hereinafter
provided.
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6. If any Underwriter defaults in the performance of its obligations
under this Agreement, the remaining non-defaulting Underwriters shall be
obligated to purchase the Immediate Delivery Underwritten Securities
which the defaulting Underwriter agreed but failed to purchase in the
respective proportions which the principal amount of Underwritten
Securities set forth in Schedule II hereto to be purchased by each
remaining non-defaulting Underwriter set forth therein bears to the
aggregate principal amount of Underwritten Securities set forth therein
to be purchased by all the remaining non-defaulting Underwriters;
provided that the remaining non-defaulting Underwriters shall not be
obligated to purchase any Immediate Delivery Underwritten Securities if
the aggregate principal amount of Immediate Delivery Underwritten
Securities which the defaulting Underwriter or Underwriters agreed but
failed to purchase exceeds 9.09% of the total principal amount of
Underwritten Securities, and any remaining non-defaulting Underwriter
shall not be obligated to purchase more than 110% of the principal
amount of Underwritten Securities set forth in Schedule II hereto to be
purchased by it. If the foregoing maximums are exceeded, the remaining
non-defaulting Underwriters, or those other underwriters satisfactory to
the Representative who so agree, shall have the right, but shall not be
obligated, to purchase, in such proportion as may be agreed upon among
them, all the Immediate Delivery Underwritten Securities. If the
remaining Underwriters or other underwriters satisfactory to the
Representative do not elect to purchase the Immediate Delivery
Underwritten Securities which the defaulting Underwriter or Underwriters
agreed but failed to purchase, this Agreement shall terminate without
liability on the part of any non-defaulting Underwriter, or the Company,
except that the Company will continue to be liable for the payment of
expenses as set forth in Paragraph 8(i) hereof.
Nothing contained in this Paragraph 6 shall relieve a defaulting
Underwriter of any liability it may have to the Company for damages caused by
its default. If other Underwriters are obligated or agree to purchase the
Immediate Delivery Underwritten Securities of a defaulting or withdrawing
Underwriter, either the Representative or the Company may postpone the Delivery
Date for up to seven full business days in order to effect any changes that in
the opinion of the Company or the Representative may be necessary in the
Registration Statement, the Prospectus or in any other document or
arrangement.
7. Delivery of and payment for the Immediate Delivery Underwritten
Securities shall be made at such address, date and time as specified in
Schedule I hereto. This date and time are sometimes referred to as the
"Delivery Date." On the Delivery Date, the Company shall deliver the
Immediate Delivery Underwritten Securities to the Representative for the
account of each Underwriter against payment to or upon the order of the
Company of the purchase price by wire transfer of immediately available
funds settled through the New York Clearing House or such other
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Clearing House as is named in Schedule I. Time shall be of the essence,
and delivery at the time and place specified pursuant to this Agreement
is a further condition of the obligation of each Underwriter hereunder.
Upon delivery, the Immediate Delivery Underwritten Securities shall be
in such form or forms and in such denominations as may be set forth in
Schedule I. Immediate Delivery Underwritten Securities in registered
form shall be in such authorized denominations and registered in such
names as the Representative shall request in writing not less than two
full business days prior to the Delivery Date. For the purpose of
expediting the checking and packaging of the Immediate Delivery
Underwritten Securities, the Company shall make the Immediate Delivery
Underwritten Securities available for inspection by the Representative
in New York, New York not later than 2:00 P.M., local time, on the
business day prior to the Delivery Date. For purposes of Rule 15c6-1
under the Exchange Act, the Delivery Date (if later than the otherwise
applicable settlement date) shall be the date for payment of funds and
delivery of securities for all the Immediate Delivery Underwritten
Securities sold pursuant to the offering, other than Delayed Delivery
Underwritten Securities for which payment of funds and delivery of
securities shall be as hereinafter provided.
8. The Company agrees with the several Underwriters:
(a) The Company will furnish promptly to the Representative and
to counsel for the Underwriters signed copies of the Registration
Statement as originally filed and each amendment and supplement thereto
filed prior to the date hereof and relating to or covering the
Underwritten Securities, and a copy of the Prospectus filed with the
Commission, including all documents incorporated therein by reference
and all consents and exhibits filed therewith;
(b) The Company will deliver promptly to the Representative such
reasonable number of the following documents as the Representative may
request: (i) conformed copies of the Registration Statement (excluding
exhibits other than the computation of the ratio of earnings to fixed
charges, the Indenture and this Agreement), (ii) the Prospectus and
(iii) any documents incorporated by reference in the Prospectus;
(c) During any period when a Prospectus relating to the
Underwritten Securities is required by law to be delivered, the Company
will not file any amendment of the Registration Statement nor will the
Company file any amendment or supplement to the Prospectus (except for
(i) an amendment or supplement consisting solely of the filing of a
document under the Exchange Act or (ii) a supplement relating to an
offering of securities other than the Underwritten Securities), unless
the Company has furnished you a copy of such proposed amendment or
supplement for your review prior to filing and will not file any such
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proposed amendment or supplement to which you reasonably object. Subject
to the foregoing sentence, the Company will cause the Prospectus and any
amendment or supplement thereto to be filed with the SEC as required
pursuant to Rule 424 under the Securities Act. The Company will promptly
advise you (i) when the Prospectus or any amendment or supplement
thereto shall have been filed with the SEC pursuant to Rule 424 under
the Securities act, (ii) when any amendment of the Registration
Statement shall have become effective, (iii) of any request by the SEC
for any amendment of the Registration Statement or amendment of or
supplement to the Prospectus or for any additional information, (iv) of
the issuance by the SEC of any stop order suspending the effectiveness
of the Registration Statement or the institution or threatening of any
proceeding for that purpose and (v) of the receipt by the Company of any
notification with respect to the suspension of the qualification of the
Underwritten Securities for sale in any jurisdiction or the initiation
or threatening of any proceeding for such purpose. The Company will
promptly (upon filing thereof) furnish you a copy of any amendment or
supplement to the Prospectus or Registration Statement not furnished to
the Representative for prior review pursuant to exception (i) or (ii) of
the first sentence of this paragraph 8(c). The Company will use its best
efforts to prevent the issuance of any such stop order and, if issued,
to obtain as soon as possible the withdrawal thereof;
(d) If, at any time when a prospectus relating to the
Underwritten Securities is required to be delivered under the Securities
Act, any event occurs as a result of which the Registration Statement,
as then amended, or the Prospectus, as then supplemented, would include
any 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 it shall
be necessary to amend the Registration Statement or to supplement the
Prospectus to comply with the Securities Act or the Exchange Act or the
respective rules thereunder, the Company promptly will (i) notify you of
the happening of such event, (ii) prepare and file with the SEC, subject
to the first sentence of paragraph (c) of this Section 8, an amendment
or supplement which will correct such statement or omission or an
amendment or supplement which will effect such compliance and (iii) will
supply any such amended or supplemented Prospectus to you in such
quantities as the Representative may reasonably request;
(e) As soon as practicable, the Company will make generally
available to its security holders and to the Representative an earnings
statement or statements of the Company which will satisfy the provisions
of Section 11(a) of the Securities Act and Rule 158 under the Securities
Act;
(f) During a period of five years after the date hereof, the
Company will furnish to the Representative copies of all reports and
financial statements furnished by the Company to each securities
exchange on which securities issued by the
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Company may be listed pursuant to requirements of or agreements with
such exchange or to the Commission pursuant to the Exchange Act or any
rule or regulation of the Commission thereunder;
(g) The Company will endeavor to qualify the Underwritten
Securities for sale under the laws of such jurisdiction as you may
designate and will maintain such qualifications in effect so long as
required for the distribution of the Underwritten Securities, provided
that in connection therewith the Company shall not be required to
qualify as a foreign corporation or take any action which would subject
it to general or unlimited service of process in any jurisdiction where
it is not now so subject;
(h) The Company will pay the costs incident to the
authorization, issuance and delivery of the Underwritten Securities and
any taxes payable in that connection; the costs incident to the
preparation, printing and filing under the Act of the Registration
Statement and any amendments, supplements and exhibits thereto; the
costs of distributing the Registration Statement as originally filed and
each amendment and post-effective amendment thereof (including
exhibits), any Preliminary Prospectus, the Prospectus and any documents
incorporated by reference in any of the foregoing documents; the costs
of producing this Agreement, the Delayed Delivery Contracts, if any, and
the Indenture; fees paid to rating agencies in connection with the
rating of the Securities, including the Underwritten Securities; the
fees and expenses of qualifying the Underwritten Securities under the
securities laws of the several jurisdictions as provided in this
Paragraph and of preparing and printing a Blue Sky Memorandum and a
memorandum concerning the legality of the Securities, including the
Underwritten Securities, as an investment; and all other costs and
expenses incident to the performance of the Company's obligations under
this Agreement; provided that, except as provided in this Paragraph and
in Paragraph 12 hereof, the Underwriters shall pay their own costs and
expenses, including the fees and expenses of their counsel, any transfer
taxes on the Underwritten Securities which they may sell and the
expenses of advertising any offering of the Underwritten Securities made
by the Underwriters; and
(i) Until the termination of the offering of the Underwritten
Securities, to timely file all documents, and any amendments to
previously filed documents, required to be filed by the Company pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act.
9. (a) The Company shall indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within
the meaning of the Act from and against any loss, claim, damage or
liability, joint or several, and any action in respect thereof, to which
that Underwriter or controlling person may
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become subject, under the Act or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based upon, any untrue
statement or alleged untrue statement of a material fact contained in
any Preliminary Prospectus, the Registration Statement or the
Prospectus, or arises out of, or is based upon, the omission or alleged
omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and shall
reimburse each Underwriter and such controlling person for any legal and
other expenses reasonably incurred by that Underwriter or controlling
person in investigating or defending or preparing to defend against any
such loss, claim, damage, liability or action as such expenses are
incurred (but no more frequently than annually); provided, however, that
the Company shall not be liable in any such case to the extent that any
such loss, claim, damage, liability or action arises out of, or is based
upon, any untrue statement or alleged untrue statement or omission or
alleged omission made in any Preliminary Prospectus, the Registration
Statement or the Prospectus in reliance upon and in conformity with
written information furnished to the Company through the Representative
by or on behalf of any Underwriter specifically for use therein. The
foregoing indemnity agreement is in addition to any liability which the
Company may otherwise have to any Underwriter or controlling person.
(b) Each Underwriter shall indemnify and hold harmless the
Company, each of their directors, each of their officers who signed the
Registration Statement and any person who controls the Company, within
the meaning of the Act from and against any loss, claim, damage or
liability, joint or several, and any action in respect thereof, to which
the Company, or any such director, officer or controlling person may
become subject, under the Act or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based upon, any untrue
statement or alleged untrue statement of a material fact contained in
any Preliminary Prospectus, the Registration Statement or the
Prospectus, or arises out of, or is based upon, the omission or alleged
omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, but in each
case only to the extent that the untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and
in conformity with information furnished in writing to the Company
through the Representative by or on behalf of that Underwriter
specifically for use therein, and shall reimburse the Company for any
legal and other expenses reasonably incurred by the Company or any such
director, officer or controlling person in investigating or defending or
preparing to defend against any such loss, claim, damage, liability or
action as such expenses are incurred (but no more frequently that
annually). The foregoing indemnity agreement is in addition to any
liability which any Underwriter may otherwise have to the Company or any
of its directors, officers or controlling persons.
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(c) Promptly after receipt by an indemnified party under this
Paragraph 9 of notice of any claim or the commencement of any action,
the indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under this Paragraph 9, notify the
indemnifying party in writing of the claim or the commencement of that
action, provided that the failure to notify the indemnifying party shall
not relieve it from any liability which it may have to an indemnified
party otherwise than under Paragraph 9(a) or 9(b). If any such claim or
action shall be brought against an indemnified party, and it shall
notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein, and, to the extent that it wishes,
jointly with any other similarly notified indemnifying party, to assume
the defense thereof with counsel satisfactory to the indemnified party.
After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, the indemnifying
party shall not be liable to the indemnified party under this Paragraph
9 for any legal or other expenses subsequently incurred by the
indemnified party in connection with the defense thereof other than
reasonable costs of investigation. If the indemnifying party shall not
elect to assume the defense of such action, such indemnifying party will
reimburse such indemnified party for the reasonable fees and expenses of
any counsel retained by them. In the event that the parties to any such
action (including impleaded parties) include both the Company and one or
more Underwriters and either (i) the indemnifying party or parties and
indemnified party or parties mutually agree or (ii) representation of
both the indemnifying party or parties and the indemnified party or
parties by the same counsel is inappropriate under applicable standards
of professional conduct or in the opinion of such counsel due to actual
or potential differing interests between them, then the indemnifying
party shall not have the right to assume the defense of such action on
behalf of such indemnified party and will reimburse such indemnified
party for the reasonable fees and expenses of any counsel retained by
them and satisfactory to the indemnifying party, it being understood
that the indemnifying party shall not, 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, be liable
for the reasonable fees and expenses of more than one separate firm of
attorneys for all such indemnified parties, which firm shall be
designated in writing by the Representative in the case of an action in
which one or more Underwriters or controlling persons are indemnified
parties and by the Company in the case of an action in which the Company
or any of its directors, officers or controlling persons are indemnified
parties. The indemnifying party or parties shall not be liable under
this Agreement with respect to any settlement made by any indemnified
party or parties without prior written consent by the indemnifying party
or parties to such settlement.
(d) If the indemnification provided for in this Paragraph 9
shall for any reason be unavailable to an indemnified party under
Paragraph 9(a) or 9(b) hereof
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in respect of any loss, claim, damage, liability or any action in
respect thereof, referred to therein, then each indemnifying party
shall, in lieu of indemnifying such indemnified party, contribute to the
amount paid or payable by such indemnified party as a result of such
loss, claim, damage or liability, or action in respect thereof, in such
proportion as is appropriate to reflect the relative benefits by the
Company, on the one hand, and the Underwriters, on the other hand, from
the offering of the Underwritten Securities. If, however, this
allocation is not permitted by applicable law, then each indemnifying
party shall contribute to the amount paid or payable by such indemnified
party as a result of such loss, claim, damage or liability, or action in
respect thereof, in such proportion as shall be 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 Underwritten
Securities and the relative fault of the Company, on the one hand, and
the Underwriters, on the other hand, with respect to the statements or
omissions which resulted in such loss, claim, damage or liability, or
action in respect thereof, 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, with respect to such
offering shall be deemed to be in the same proportion as the total net
proceeds from the offering of the Underwritten Securities (before
deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by the Underwriters with
respect to such offering. The relative fault shall be determined by
reference to whether the 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 the Underwriters, the
intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such statement or
omission. The amount paid or payable by an indemnified party as a
result of the loss, claim, damage or liability, or action in respect
thereof, referred to above in this Paragraph 9(d) shall be deemed to
include, for purposes of this Paragraph 9(d), 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 Paragraph 9(d), no Underwriter
shall be required to contribute any amount in excess of the amount by
which the total price at which the Underwritten 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 paid or
become liable to pay by reason of any untrue or alleged untrue statement
or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall
be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations to
contribute as provided in this Paragraph 9(d) are several in proportion
to their respective underwriting obligations and not joint.
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(e) The agreements contained in this Paragraph 9 and the
representations, warranties and agreements of the Company in Paragraph 1
and Paragraph 8 hereof shall survive the delivery of the Underwritten
Securities and shall remain in full force and effect, regardless of any
termination or cancellation of this Agreement or any investigation made
by or on behalf of any indemnified party.
10. The obligations of the Underwriters under this Agreement may be
terminated by the Representative, in its absolute discretion, by notice
given to and received by the Company prior to the delivery of and
payment for the Immediate Delivery Underwritten Securities, if, during
the period beginning on the date hereof to and including the Delivery
Date, (a) trading in securities generally on the New York Stock
Exchange, Inc. is suspended or materially limited, or (b) a banking
moratorium is declared by either Federal or New York State authorities,
or (c) there shall have occurred any outbreak or material escalation of
hostilities or other calamity or crisis or the declaration by the United
States of war or a national emergency the effect of which on the
financial markets of the United States is material and adverse and is
such as to make it, in the reasonable judgment of the Representative,
impracticable or inadvisable to market such Underwritten Securities on
the terms and in the manner contemplated by the Prospectus, or (d) the
Company shall have received notice that any rating of any of the
Company's unsecured senior debt securities shall have been lowered by
any nationally recognized statistical rating organization (as defined in
Rule 15c3-1 under the Exchange Act) or any such organization has
publicly announced that it has under surveillance or review, with
possible negative implications, the ratings of any of the Company's
unsecured senior debt securities, or (e) there shall have occurred any
change, or any development involving a prospective change, in or
affecting particularly the business or properties of the Company or its
subsidiaries which, in the Representative's reasonable judgment,
materially impairs the investment quality of the Underwritten
Securities.
11. The respective obligations of the Underwriters under the
Agreement with respect to the Underwritten Securities are subject to the
accuracy, on the date hereof and on the Delivery Date, of the
representations and warranties of the Company contained herein, to
performance by the Company of its obligations hereunder, and to each of
the following additional terms and conditions applicable to the
Underwritten Securities:
(a) At or before the Delivery Date, no stop order suspending the
effectiveness of the Registration Statement nor any order directed to
any document incorporated by reference in the Prospectus shall have been
issued and prior to that time no stop order proceeding shall have been
initiated or threatened by the Commission and no challenge shall have
been made by the Commission or its staff as to the accuracy or adequacy
of any document incorporated by reference in the
-13-
14
Prospectus; any request of the Commission for inclusion of additional
information in the Registration Statement or the Prospectus or otherwise
shall have been complied with; and after the date hereof the Company
shall not have filed with the Commission any amendment or supplement to
the Registration Statement or the Prospectus (or any document
incorporated by reference therein) that shall have been disapproved by
the Representative.
(b) No Underwriter shall have discovered and disclosed to the
Company on or prior to the Delivery Date that the Registration Statement
or the Prospectus contains an untrue statement of a fact which is
material or omits to state a fact which is material and is required to
be stated therein or is necessary to make the statements therein not
misleading.
(c) All corporate proceedings and other legal matters incident
to the authorization, form and validity of this Agreement, the
Underwritten Securities and the Indenture and the form of the
Registration Statement, the Prospectus (other than financial statements
and other financial data) and all other legal matters relating to this
Agreement and the transactions contemplated hereby shall be satisfactory
in all respects to Xxxxxxxx & Xxxxxxxx, counsel for the Underwriters,
and the Company shall have furnished to such counsel all documents and
information that they may reasonably request to enable them to pass upon
such matters.
(d) The Vice President and Counsel to the Company shall have
furnished to the Representative his opinion addressed to the
Underwriters and dated the Delivery Date, as counsel, to the effect
that:
(i) the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
State of Missouri, with full corporate power and authority to own
its properties and conduct its business as described in the
Prospectus, and is duly qualified to do business as a foreign
corporation and is in good standing under the laws of each
jurisdiction which requires such qualification wherein it owns or
leases properties or conducts business, except where the failure
to so qualify would not have a material adverse effect on the
Company;
(ii) the Indenture has been duly authorized, executed and
delivered, has been duly qualified under the Trust Indenture Act,
and constitutes a legal, valid and binding instrument enforceable
against the Company in accordance with its terms (subject, as to
enforcement of remedies, to applicable bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium or other similar
laws of general
-14-
15
applicability relating to or affecting creditors' rights
generally from time to time in effect and to general principles
of equity);
(iii) to the best knowledge of such counsel, there is no
pending or threatened action, suit or proceeding before any court
or governmental agency, authority, body or any arbitrator
involving the Company of a character required to be disclosed in
the Registration Statement which is not adequately disclosed in
the Prospectus, and there is no franchise, contract or other
document of a character required to be described in the
Registration Statement or Prospectus, or to be filed as an
exhibit, which is not described or filed as required; and the
statements included or incorporated by reference in the
Prospectus describing any legal proceedings or material contracts
or agreements relating to the Company fairly summarize such
matters; and the Underwritten Securities, the Indenture and any
Delayed Delivery Contracts conform to the descriptions thereof
contained under the following (or comparable) captions of the
Prospectus: "Description of Debt Securities" and "Plan of
Distribution";
(iv) the Immediate Delivery Underwritten Securities have
been duly authorized, executed, authenticated, issued and
delivered and are valid and legally binding obligations of the
Company entitled to the benefits of the Indenture;
(v) the Delayed Delivery Underwritten Securities, if any,
have been duly authorized and, when executed, authenticated,
issued and delivered to, and paid for by, the respective
purchasers thereof in accordance with the Indenture and the
related Delayed Delivery Contracts, will be valid and legally
binding obligations of the Company entitled to the benefits of
the Indenture;
(vi) the Registration Statement and any amendments
thereto have become effective under the Securities Act; to the
best knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued, no
proceedings for that purpose have been instituted or threatened,
and the Registration Statement, the Prospectus and each amendment
thereof or supplement thereto as of their respective effective or
issue dates (other than the financial statements and other
financial and statistical information contained therein as to
which such counsel need express no opinion) complied as to form
in all material respects with the applicable requirements of the
Securities Act, the Exchange Act and the Trust Indenture Act and
the respective rules and regulations thereunder; and such counsel
has no
-15-
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reason to believe that the Registration Statement, or any
amendment thereof, at the time it became effective or at the date
of this Agreement or at the Delivery 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, at the
date of this Agreement or at the Delivery Date, included any
untrue statement of a material fact or omitted to state a
material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not
misleading;
(vii) this Agreement and the Delayed Delivery Contracts,
if any, have been duly authorized, executed and delivered by the
Company;
(viii) no order, consent, approval, authorization,
registration or qualification of or with any governmental agency
or body having jurisdiction over the Company or any of its
properties is required for the issue and sale of the Underwritten
Securities or the consummation by the Company of the transactions
contemplated by this Agreement or the Indenture, except such as
have been obtained under the Securities Act and the Trust
Indenture Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the sale and
distribution of the Underwritten Securities; and
(ix) neither the execution and delivery of the
Indenture, this Agreement or any Delayed Delivery Contracts, the
issue and sale of the Underwritten Securities, nor the
consummation of any other of the transactions herein or therein
contemplated nor the fulfillment of the terms hereof or thereof
will conflict with, result in a breach of, or constitute a
default under, the charter or by-laws of the Company or the terms
of any indenture or other agreement or instrument known to such
counsel and to which the Company is a party or by which the
Company or any of its assets is bound, or any order or regulation
known to such counsel to be applicable to the Company of any
court, regulatory body, administrative agency, governmental body
or arbitrator having jurisdiction over the Company.
In rendering such opinion, such counsel may rely, as to the execution of the
Indenture by the Trustee, upon a certificate of the Trustee setting forth the
facts as to such execution.
In rendering such opinion, such counsel may also rely (A) as to matters
involving the application of laws of any jurisdiction other than the State of
Missouri upon the opinion
-16-
17
of other counsel of good standing believed to be reliable, provided that such
counsel states in such opinion that such counsel and the Representative are
justified in relying upon the opinion of such other counsel, and (B) as to
matters of fact, to the extent deemed proper, on certificates of responsible
officers of the Company and public officials.
In rendering such opinion with respect to clause (viii) above, insofar as it
relates to regulatory authorities in the states in which the Company operates,
such counsel may rely on the opinions of local counsel satisfactory to such
counsel.
(e) The Representative shall have received from Xxxxxxxx &
Xxxxxxxx, counsel for the Underwriters, such opinion or opinions, dated
the date hereof, with respect to the issuance and sale of the
Underwritten Securities, the Indenture, the Registration Statement, the
Prospectus and other related matters as the Representative may
reasonably 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 Company shall have furnished to the Representative a
certificate signed by its Chairman of the Board or its President or a
Vice President and its Treasurer or an Assistant Treasurer stating that
after reasonable investigation and to the best of their knowledge:
(i) the representations and warranties of the Company in
this Agreement are true and correct in all material respects on
and as of the Delivery Date with the same effect as if made on
the Delivery Date; the Company has complied with all the
agreements and satisfied all the conditions on its part to be
performed or satisfied as a condition to the obligation of the
Underwriters to purchase the Underwritten Securities hereunder;
and the conditions set forth in Paragraphs 11(a) and 11(h) have
been fulfilled;
(ii) as of the date of the Prospectus, the Registration
Statement and the Prospectus did not include any untrue statement
of a material fact and did not omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading; and
(iii) since the date of the most recent financial
statements included or incorporated by reference in the
Prospectus, there has been no material adverse change in the
condition (financial or other), earnings, business or properties
of the Company and its subsidiaries,
-17-
18
whether or not arising from transactions in the ordinary course
of business, except as set forth in or contemplated in the
Prospectus.
(g) The Company shall have furnished to the Representative (i) a
letter of Ernst & Young LLP, addressed to the Board of Directors of the
Company and the Underwriters and dated the later of the effective date
of the Registration Statement or the date of the filing of the Company's
latest Annual Report on Form 10-K, of the type described in the American
Institute of Certified Public Accountants' Statement on Auditing
Standards No. 72 and covering such financial statement items as counsel
for the Underwriters may reasonably have requested; (ii) a letter of
Ernst & Young LLP, addressed to the Underwriters and dated the Delivery
Date, stating, as of the date of such letter (or, with respect to
matters involving changes or developments since the respective dates as
of which specified financial information is given in the Prospectus, as
of a date not more than five days prior to the date of such letter), the
conclusions and findings of such firm with respect to the financial
information and other matters covered by its letter referred to in
subclause (i) above and confirming in all material respects the
conclusions and findings set forth in such prior letter; and (iii) a
letter, dated the Delivery Date, of any other accountants that have
audited financial statements included or incorporated by reference in
the Registration Statement and Prospectus, addressed to the
Underwriters, of the type described in SAS 72 and covering such
financial statement items as the Underwriters may reasonably request.
(h) No order, consent, approval, authorization, registration or
qualification of or with any governmental agency or body having
jurisdiction over the Company or any of its properties is required for
the issue and sale of the Underwritten Securities or the consummation by
the Company of the transactions contemplated by this Agreement or the
Indenture, except such as have been, or will have been prior to the
Delivery Date, obtained under the Act and the Trust Indenture Act and
such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky
laws in connection with the purchase and distribution of the
Underwritten Securities by the Underwriters.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance satisfactory to the
Representative.
12. If the Company shall fail to tender the Immediate Delivery
Underwritten Securities for delivery to the Underwriters for any reason
permitted under this Agreement, or if the Underwriters shall decline to
purchase the Immediate Delivery Underwritten Securities for any reason
permitted under this Agreement (other than pursuant to Paragraph 6 or
Paragraphs 10(a) - (d) hereof), the Company shall reimburse the
Underwriters for the reasonable fees and expenses of their counsel
-18-
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and for such other out-of-pocket expenses as shall have been incurred by
them in connection with this Agreement and the proposed purchase of
Immediate Delivery Underwritten Securities and the solicitation of any
purchases of the Delayed Delivery Underwritten Securities, and upon
demand the Company shall pay the full amount thereof to the
Representative. If this Agreement is terminated pursuant to Paragraph 6
hereof by reason of the default of one or more Underwriters or pursuant
to Paragraphs 10(a) - (d) hereof, the Company shall not be obligated to
reimburse any Underwriter on account of those expenses.
13. The Company shall be entitled to act and rely upon any request,
consent, notice or agreement by, or on behalf of, the Representative.
Any notice by the Company to the Underwriters shall be sufficient if
given in writing or by facsimile transmission confirmed promptly in
writing addressed to the Representative at its address set forth in
Schedule I hereto, and any notice by the Underwriters to the Company
shall be sufficient if given in writing or by facsimile transmission
confirmed promptly in writing addressed to the Company at 000 X. Xxxxxxx
Xx., 0xx Xxxxx, Xxx Xxxxxxx, Xxxxx 00000, Telecopy Number: (210) 351-
3849, Attention of the Treasurer, with a copy to the Corporate/SEC
Attorney, 000 X. Xxxxxxx Xx., 0xx Xxxxx, Xxx Xxxxxxx, Xxxxx 00000,
Telecopy Number: (000) 000-0000.
14. This Agreement shall be binding upon the Underwriters, the
Company and their respective successors. This Agreement and the terms
and provisions hereof are for the sole benefit of only those persons,
except that (a) the representations, warranties, indemnities and
agreements of the Company contained in this Agreement shall also be
deemed to be for the benefit of the person or persons, if any, who
control any Underwriter within the meaning of Section 15 of the Act and
(b) the indemnity agreement of the Underwriters contained in Paragraph 9
hereof shall be deemed to be for the benefit of directors of the
Company, officers of the Company who have signed the Registration
Statement and any person controlling the Company. Nothing in this
Agreement is intended or shall be construed to give any person, other
than the persons referred to in this Paragraph 14, any legal or
equitable right, remedy or claim under or in respect of this Agreement
or any provision contained herein.
15. For purposes of this Agreement, "business day" means any day on
which the New York Stock Exchange, Inc. is open for trading.
16. This Agreement may be executed by the parties hereto in any
number of counterparts, each of which shall be deemed to be an original,
but all such counterparts shall together constitute one and the same
instrument.
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20
17. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAW OF NEW YORK.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this Agreement shall represent a binding agreement between the
Company and the several Underwriters.
Very truly yours,
SOUTHWESTERN XXXX TELEPHONE COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------
Xxxxxx X. Xxxxxxx
Vice President
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21
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
Xxxxxx Xxxxxxx & Co. Incorporated
/s/ Xxxxxx X. Xxxxxxxxxx III
------------------------------------------
Name: Xxxxxx X. Xxxxxxxxxx III
Title: Vice President
For itself and as Representative of the
several Underwriters named in Schedule
II to the foregoing Agreement.
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SCHEDULE I
Underwriting Agreement dated November 18, 1997
Registration Statement Nos. 33-49967 and 333-37515
Representative and Address:
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Underwritten Securities:
Indenture, dated as of February 1, 1985, as supplemented by the First
Supplemental Indenture, dated as of June 1, 1991, from Southwestern Xxxx
Telephone Company to The Bank of New York, as Trustee (together, the
"Indenture").
As used in this Underwriting Agreement, references to "Underwritten
Securities" shall be deemed to be separate references to the 6 % Notes
(as hereinafter defined) and the 7% Debentures (as hereinafter defined),
each of which constitutes a separate series of Securities under the
Indenture.
Designations: 6 3/8% Notes Due November 15, 2007
("6 3/8% Notes")
7% Debentures Due November 15, 2027
("7% Debentures")
Principal Amounts: 6 3/8% Notes: $100,000,000
7% Debentures: $100,000,000
Dates of Maturity: 6 3/8% Notes: November 15, 2007
7% Debentures: November 15, 2027
23
Interest Rates: 6 3/8% Notes: 6 3/8% per annum.
7% Debentures: 7% per annum. In each case payable
semi-annually on each May 15 and November 15,
commencing May 15, 1998, to holders of record at
the close of business on the preceding May 1 or
November 1.
Purchase Prices: 6 3/8% Notes: 98.688% of the principal amount.
7% Debentures: 97.285% of the principal amount.
Plus, in each case, accrued interest, if any, from
November 21, 1997 to the date of delivery.
Redemption Provisions: The 6 3/8% Notes are not redeemable prior to
maturity.
The 7% Debentures are not redeemable prior to
November 15, 2007. On or after November 15, 2007
and prior to maturity, the Company, at its option,
may redeem all or from time to time any part of the
7% Debentures upon not less than 30 days but not
more than 60 days' notice at the following
redemption prices (expressed in percentages of the
principal amount) during the 12-month periods
beginning November 15:
REDEMPTION
YEAR PRICE
-------------- -------------------
2007 102.580%
2008 102.322
2009 102.064
2010 101.806
2011 101.548
2012 101.290
2013 101.032
2014 100.774
2015 100.516
2016 100.258
and thereafter at 100% of the principal amount
thereof, in each case together with accrued
interest to the redemption date.
Form and Authorized The 6 3/8% Notes and the 7% Debentures each
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Denominations: will be issued only in registered, book-entry form
in denominations of $1,000 and integral multiples
thereof. The 6 3/8% Notes and the 7% Debentures
each will be represented by a global security or
securities deposited with, or on behalf of, The
Depository Trust Company, and registered in the
name of Cede & Co., as nominee for The Depository
Trust Company.
Delivery Date, Time 10:00 a.m. (New York time)
and Location: November 21, 1997, at the offices of
Xxxxxxxx & Xxxxxxxx, 000 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000.
Specified Funds for Immediately available funds.
Payment of Purchase Price:
The Delayed Delivery There are no Delayed Delivery Contracts.
Contracts shall have
the following terms:
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25
SCHEDULE II
6 3/8% Notes 7% Debentures
Underwriter Principal Amount Principal Amount
----------- ---------------------- -----------------------
Xxxxxx Xxxxxxx & Co. Incorporated . . . . . . $ 25,000,000 $ 25,000,000
Xxxxxxx, Sachs & Co. . . . . . . . . . . . . 25,000,000 25,000,000
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated . . . . . . . . 25,000,000 25,000,000
Salomon Brothers Inc . . . . . . . . . . . . 25,000,000 25,000,000
------------ ------------
Total . . . . . . . . . . . . . . . . $ 100,000,000 $ 100,000,000
============= =============
26
EXHIBIT A
SOUTHWESTERN XXXX TELEPHONE COMPANY
DELAYED DELIVERY CONTRACT
, 199
Southwestern Xxxx Telephone Company
000 X. Xxxxxxx
Xxx Xxxxxxx, Xxxxx 00000
Dear Sirs:
The undersigned hereby agrees to purchase from Southwestern Xxxx
Telephone Company, a Missouri corporation (the "Company"), and the Company
hereby agrees to sell to the undersigned, $__________ principal amount of the
Company's above-captioned securities ("Securities"), offered by the Company's
prospectus dated , 199 , as supplemented by the
prospectus supplement dated , 199 (collectively, the
"Prospectus"), receipt of a copy of which is hereby acknowledged, at a purchase
price of % of the principal amount thereof plus accrued interest from
, 199 to the Delivery Date (as defined in the next
paragraph) and on the further terms and conditions set forth in this Contract.
Payment for and delivery of the Securities to be purchased by the
undersigned shall be made on , 199 , herein called
the "Delivery Date."
At 10:00 A.M., New York time, on the Delivery Date, the
Securities to be purchased by the undersigned hereunder will be delivered by
the Company to the undersigned, and the undersigned will accept delivery of
such Securities and will make payment to the Company of the purchase price
therefor at the office of The Bank of New York. Payment will be by certified
or official bank check payable in next-day funds settled through the New York
Clearing House, or such other Clearing House as the Company may designate, to
or upon the order of the Company. The Securities will be delivered in such
authorized forms and denominations and registered in such names as the
undersigned may designate by written or telegraphic communication addressed to
the Company not less than two full business days prior to the Delivery Date or,
if the undersigned fails to make a timely designation in the foregoing manner,
in the form of one definitive fully registered certificate representing the
Securities in the above principal amount, registered in the name of the
undersigned.
27
If any of the Securities are to be delivered to the undersigned
in bearer form, (i) the undersigned hereby represents that it is not a U.S.
person (or if it is a U.S. person it is a qualified financial institution) and
agrees that it will not offer to sell such Securities, directly or indirectly,
to any U.S. person other than a qualified financial institution and (ii) if the
undersigned is a dealer, that the undersigned also (A) represents that it has
not offered or sold and agrees that it will not offer, sell, or deliver any
such Securities within the United States or, directly or indirectly, to any
U.S. person other than a qualified financial institution and is not purchasing
any of such Securities for the account of any such U.S. person and (B) will
deliver to all purchasers of such Securities from it a written confirmation,
containing a statement to the effect set forth in clauses (i) and (ii) above.
As used herein, "United States" means the United States of America (including
the States and the District of Columbia), its territories, its possessions and
all other areas subject to its jurisdiction; "U.S. person" means a citizen or
resident of the United States, a corporation, partnership or other entity
created or organized in or under the laws of the United States or a political
subdivision thereof, or an estate or trust the income of which is subject to
United States Federal income taxation regardless of its source; and "qualified
financial institution" means a financial institution (as defined in Section
1.165-12(c)(1)(v) of the Treasury Department regulations) that provides a
written statement that it will comply with Section 165(j)(3)(A), (B), or (C) of
the Code and the regulations thereunder. Delivery of Securities in bearer form
shall be made only upon receipt of a certificate manually signed by the
undersigned, containing substantially the following:
"This is to certify that as of the date hereof (the date of
delivery of the Securities in bearer form), the above-captioned
Securities which are to be delivered to the undersigned in bearer form
are not being acquired by or on behalf of a U.S. person, or for offer to
resell or for resale to a U.S. person or, if any beneficial owner of the
Securities is a U.S. person, such U.S. person is a financial institution
(as defined in Treasury Department Regulations Section
1.165-12(c)(1)(v)) or acquiring through a financial institution and that
the Securities are held by a financial institution that has agreed to
comply with the requirements of Section 165(j)(3)(A), (B), or (C) of the
Internal Revenue Code of 1986, and the regulations thereunder. If the
undersigned is a clearing organization, the undersigned represents that
the certificate is based on statements provided to it by its member
organizations. As used herein, "United States" means the United States
of America (including the States and the District of Columbia), its
territories, its possessions and all other areas subject to its
jurisdiction; "U.S. person" means a citizen or resident of the United
States, a corporation, partnership or other entity created or organized
in or under the laws of the United States or a political subdivision
thereof, or an estate or trust the income of which is subject to United
States Federal income taxation regardless of its source; and a "clearing
organization" means an entity which is in the business of holding
obligations for member organizations and transferring obligations among
such members by credit or
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28
debit to the account of a member without the necessity of physical
delivery of the obligation. If the undersigned is a dealer, the
undersigned agrees to obtain a similar certificate from each person
entitled to delivery of any of the above-captioned Securities in bearer
form purchased from it. However, if the undersigned has actual
knowledge that the information contained in such certificate is false,
the undersigned will not deliver a Security in temporary or definitive
bearer form to the person who signed such certificate notwithstanding
the delivery of such certificate to the undersigned. The undersigned
will be deemed to have actual knowledge that the beneficial owner is a
U.S. person for this purpose if the undersigned has a U.S. address for
the beneficial owner of the Security."
This Contract will terminate and be of no further force and
effect after , unless (i) on or before such date it
shall have been executed and delivered by both parties hereto and (ii) the
Company shall have sold to the Underwriters named in the Prospectus the
Immediate Delivery Underwritten Securities (as defined in the Underwriting
Agreement referred to in the Prospectus). The Company will mail or deliver to
the undersigned at its address set forth below a notice to that effect, stating
the date of the occurrence thereof, accompanied by copies of the opinion of
counsel for the Company delivered to such Underwriters pursuant to Paragraph
11(d) of the Underwriting Agreement.
The obligation of the undersigned to accept delivery of and make
payment for the Securities on the Delivery Date will be subject to the
condition that the Securities shall not, on the Delivery Date, be an investment
prohibited by the laws of the jurisdiction to which the undersigned is subject,
the undersigned hereby representing that such an investment is not so
prohibited on the date hereof.
This Contract will inure to the benefit of and be binding upon
the parties hereto and their respective successors but will not be assignable
by either party hereto without the written consent of the other.
This Contract may be executed by any of the parties hereto in any
number of counterparts, each of which shall be deemed to be an original, but
all such counterparts shall together constitute one and the same instrument.
It is understood that acceptance of any Delayed Delivery Contract
(as defined in said Underwriting Agreement) is in the Company's sole discretion
and, without limiting the foregoing, need not be on a first-come, first-served
basis. If this Contract is acceptable to the Company, it is requested that the
Company sign the form of acceptance
-3-
29
below and mail or deliver one of the counterparts hereof to the undersigned at
its address set forth below. This will become a binding contract between the
Company and the undersigned when such counterpart is so mailed or delivered.
Very truly yours,
By
----------------------------------
------------------------------------
Title
------------------------------------
------------------------------------
Address
Accepted as of , 199
SOUTHWESTERN XXXX TELEPHONE COMPANY
By
------------------------------------
Title:
-4-
