EXHIBIT 1-a
XXXXXXX'X, INC.
SECURITIES
UNDERWRITING AGREEMENT BASIC PROVISIONS
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_________, 1998
1. Xxxxxxx'x, Inc. (the "Company"), proposes to issue and sell from time
to time debt securities ("Debt Securities"), shares of its Class A Common Stock,
par value $.01 per share ("Class A Common Stock") and shares of its Additional
Preferred Stock, par value $.01 per share ("Additional Preferred Stock")
registered under the registration statement referred to in Section 2(a)
("Registered Securities"). If specified in a Terms Agreement referred to in
Section 3, the Company proposes to grant to the underwriters an option to
purchase up to that amount of Registered Securities specified in such Terms
Agreement (herein called the Option Securities). The Debt Securities will be
issued under indentures (as they may be amended or supplemented from time to
time, the "Indentures"), more particularly described in a Terms Agreement,
between the Company and the trustees named therein (the "Trustee(s)"), in one or
more series, which series may vary as to interest rates, maturities, redemption
provisions, selling prices and other terms, with all such terms for any
particular series of the Debt Securities being determined at the time of sale.
The preferred stock will be issued in one or more series, which series may vary
as to voting rights, dividends, optional and mandatory redemption provisions,
liquidation preference and conversion provisions and other terms, with all such
terms for any particular series or issue of the preferred stock being determined
at the time of issue. The Registered Securities will be sold pursuant to a Terms
Agreement, for resale in accordance with terms of offering determined at the
time of sale.
The Registered Securities (together with the Option Securities)
involved in any such offering are hereinafter referred to as the "Securities."
The firm or firms which agree to purchase the Securities are hereinafter
referred to as the "Underwriters" of such Securities, and the representative or
representatives of the Underwriters, if any, specified in a Terms Agreement are
hereinafter referred to as the "Representatives"; provided, however, that if the
Terms Agreement does not specify any representative of the Underwriters, the
term "Representatives," as used in this Agreement (other than in Sections 2(b),
6(f), 6(g) and 7 and the second sentence of Section 3) shall mean the
Underwriters.
2. The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(a) A registration statement on Form S-3 relating to
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the Registered Securities and more particularly described in the applicable
Terms Agreement relating to the Securities has been filed with the
Securities and Exchange Commission (the "Commission") and has been declared
effective by the Commission and no stop order suspending the effectiveness
of such registration statement has been issued and no proceeding for that
purpose has been initiated or threatened by the Commission. If any post-
effective amendment to such registration statement has been filed with the
Commission prior to the date of the applicable Terms Agreement, the most
recent such amendment has been declared effective by the Commission. For
purposes of this Agreement, "Effective Date" means the date as of which
such registration statement, or the most recent post-effective amendment
thereto, if any, was declared effective by the Commission. Such
registration statement, as amended at the Effective Date, including all
material incorporated by reference therein and, if the date of the Terms
Agreement is on or before the fifth business day after the Effective Date,
including all information deemed to be a part thereof as of the Effective
Date pursuant to paragraph (b) of Rule 430A under the Securities Act of
1933, as amended (the "Act"), is hereinafter referred to as the
"Registration Statement," and the form of prospectus relating to the
Securities, as first filed pursuant to paragraph (1) or (4) of Rule 424(b)
("Rule 424(b)") under the Act or, if the date of the Terms Agreement is
after the fifth business day after the Effective Date, pursuant to Rule
424(b)(2) or (5), as such form of prospectus may be supplemented as
contemplated by Section 1 to reflect the terms of the Securities and the
terms of offering thereof, including all documents incorporated by
reference therein, is hereinafter referred to as the "Prospectus."
(b) On the Effective Date, the Registration Statement conformed in
all respects to the requirements of the Act, the Trust Indenture Act of
1939 ("Trust Indenture Act") and the rules and regulations of the
Commission ("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 the applicable Terms Agreement, and at the
time of filing of the Prospectus pursuant to Rule 424(b) and on the Closing
Date, the Registration Statement and the Prospectus will conform in all
respects to the requirements of the Act, the Trust Indenture Act and the
Rules and Regulations, and neither of such documents will 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, except that the foregoing does not apply to statements in
or omissions from any of such documents based upon written information
furnished to the Company by or on behalf of any Underwriter through the
Representatives, if any, specifically for use therein.
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(c) The Indenture, if any, described in the Terms Agreement has been
duly authorized and, when executed by the proper officers of the Company
and delivered (assuming due execution and delivery thereof by the Trustee),
will constitute the valid and legally binding instrument of the Company.
The Debt Securities, if any, described in the Terms Agreement have been
duly and validly authorized and will be, when validly executed,
authenticated and delivered in accordance with the terms of the Indenture,
issued and outstanding obligations of the Company entitled to the benefits
of the Indenture. (ii) The Class A Common Stock and Additional Preferred
Stock, if any, described in the Terms Agreement have been duly and validly
authorized and when issued will be fully paid and non-assessable. (iii) No
further approval or authority of the stockholders or the Board of Directors
of the Company will be required for the issuance and sale of the Securities
as contemplated herein. (iv) The Securities conform to the description
thereof in the Prospectus.
(d) The Company has complied with all provisions of Section 1 of Laws
of Florida, Chapter 92-198 Securities-Business with Cuba.
3. The obligation of the Underwriters to purchase the Securities will be
evidenced by an exchange of a written communication ("Terms Agreement") at each
time the Company determines to sell the Securities. Each Terms Agreement will
be in the form of Annex II (A) or (B) attached hereto and will incorporate by
reference the provisions of this Agreement, except as otherwise provided
therein, and will specify the firm or firms which will be Underwriters, the
names of any Representatives, the amount to be purchased by each Underwriter,
the purchase price to be paid by the Underwriters and certain terms of the
Securities and whether any of the Securities may be sold to institutional
investors pursuant to Delayed Delivery Contracts (as defined below).
Securities to be purchased by each Underwriter pursuant to the Terms
Agreement relating thereto, in definitive form to the extent practicable, and in
such authorized denominations and registered in such names as the
Representatives may request upon at least forty-eight hours' prior notice to the
Company, shall be delivered by or on behalf of the Company to the
Representatives for the account of such Underwriter, against payment by such
Underwriter or on its behalf of the purchase price therefor by certified or
official bank check or checks, payable to the order of the Company in the funds
specified in such Terms Agreement, all at the place and time and date specified
in such Terms Agreement or at such other place and time and date as the
Representatives and the Company may agree upon in writing (such time and date
being referred to as the "Closing Date").
If specified in a Terms Agreement, on the basis of the
representations, warranties and covenants herein contained, and subject to the
terms and conditions herein set forth, the Company
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grants an option to the several Underwriters to purchase, severally and not
jointly, up to that amount of the Option Securities, as shall be specified in
the Terms Agreement, from the Company at the same price as the Underwriters
shall pay for the Securities. Said option may be exercised only to cover over-
allotments in the sale of the Securities by the Underwriters and may be
exercised in whole or in part at any time (but not more than once) on or before
the thirtieth day after the date of the Terms Agreement upon written or
telegraphic notice by you to the Company setting forth the amount of the Option
Securities as to which the several Underwriters are exercising the option. The
amount of Option Securities to be purchased by each Underwriter shall be the
same percentage of the total amount of the Option Securities to be purchased by
the several Underwriters as such Underwriter is purchasing of the Securities, as
adjusted by you in such manner as you deem advisable to avoid fractional
shares/units.
If the Terms Agreement provides for sales of Securities pursuant to
delayed delivery contracts, the Company authorizes the Underwriters to solicit
offers to purchase Securities pursuant to delayed delivery contracts
substantially in the form of Annex I attached hereto ("Delayed Delivery
Contract") with such changes therein as the Company may authorize or approve.
Delayed Delivery Contracts are only to be with institutional investors,
including commercial and savings banks, insurance companies, pension funds,
investment companies and educational and charitable institutions. On the Closing
Date the Company will pay, as compensation, to the Representatives for the
accounts of the Underwriters, the fee set forth in such Terms Agreement in
respect of the amount of Securities to be sold pursuant to Delayed Delivery
Contracts ("Contract Securities"). The Underwriters will not have any
responsibility in respect of the validity or the performance of Delayed Delivery
Contracts. If the Company executes and delivers Delayed Delivery Contracts, the
Contract Securities will be deducted from the Securities to be purchased by the
several Underwriters and the aggregate amount of Securities to be purchased by
each Underwriter will be reduced pro rata in proportion to the amount of
Securities set forth opposite each Underwriter's name in such Terms Agreement,
except to the extent that the Representatives determine that such reduction
shall be otherwise than pro rata and so advise the Company. The Company will
advise the Representatives not later than the business day prior to the Closing
Date of the amount of Contract Securities.
4. The Company agrees with each of the Underwriters of any Securities:
(a) To prepare the Prospectus as amended and supplemented in relation
to the applicable Securities in a form approved by you and to file such
Prospectus with the Commission (i) pursuant to Rule 424(b)(1) (or, if
applicable and if consented to by the Representatives, pursuant to Rule
424(b)(4)) not later than the Commission's close of business on the earlier
of (A) the second business day following the
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date of the Terms Agreement or (B) the fifth business day after the
Effective Date, or (ii) if the date of the Terms Agreement is after the
fifth business day after the Effective Date, pursuant to Rule 424(b)(2)
(or, if applicable and if consented to by the Representatives, pursuant to
Rule 424(b)(5)) not later than the second business day following the date
of a Terms Agreement; the Company will advise you promptly of any such
filing pursuant to Rule 424(b); the Company will advise the Representatives
promptly of any proposal to amend or supplement the Registration Statement
or the Prospectus and will afford the Representatives a reasonable
opportunity to comment on any such proposed amendment or supplement; to
file promptly all reports and any definitive proxy or information
statements required to be filed by the Company with the Commission pursuant
to Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act") for so long as the delivery of a
prospectus is required in connection with the offering or sale of such
Securities, and during such same period to advise the Representatives,
promptly after it receives notice thereof, of the time when any amendment
to the Registration Statement has been filed or become effective or any
supplement to the Prospectus or any amended Prospectus has been filed, or
mailed for filing, of the issuance by the Commission of any stop order or
of any order preventing or suspending the use of any prospectus relating to
the Securities, of the suspension of the qualification of such Securities
for offering or sale in any jurisdiction, of the initiation or threatening
of any proceeding for any such purpose, or of any request by the Commission
for the amending or supplementing of the Registration Statement or
Prospectus or for additional information; and, in the event of the issuance
of any such stop order or of any such order preventing or suspending the
use of any prospectus relating to the Securities or suspending any such
qualification, to use promptly its best efforts to obtain its withdrawal;
(b) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify such Securities for
offering and sale under the securities laws of such jurisdictions as the
Representatives may request and to comply with such laws so as to permit
the continuance of sales and dealings therein in such jurisdictions for as
long as may be necessary to complete the distribution of such Securities,
provided that in connection therewith the Company shall not be required to
qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction;
(c) To furnish the Underwriters with 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 as soon as
available and in such quantities as the Representatives may
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from time to time reasonably request, and, if the delivery of a prospectus
is required at any time in connection with the offering or sale of the
Securities and if at such time any event shall have occurred as a result of
which the Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made when such Prospectus is delivered,
not misleading, or, if for any other reason it shall be necessary during
such 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 Act, the Exchange Act or the Trust Indenture Act,
to notify the Representatives and upon their request to file such document
and to prepare and furnish without charge to each Underwriter and to any
dealer in securities as many copies as the Representatives may from time to
time reasonably request of an amended Prospectus or a supplement to the
Prospectus which will correct such statement or omission or effect such
compliance;
(d) To make generally available to its security holders as soon as
practicable, but in any event not later than eighteen months after the
later of the effective date of the Registration Statement and the effective
date of any post-effective amendment thereto, an earnings statement of the
Company and its subsidiaries (which need not be audited) complying with
Section 11(a) of the Act and the rules and regulations of the Commission
thereunder (including at the option of the Company Rule 158); and
(e) Without the prior consent of the Representatives, the Company
will not, (A) offer, sell, contract to sell or otherwise dispose of any
shares of common stock or any securities convertible into or exchangeable
or exercisable for or any rights to purchase or acquire common stock for
that period specified in the Terms Agreement, other than shares of common
stock or options to purchase common stock granted under the Company's
employee benefit plans and, (B) in the event of an offering of Debt
Securities, for the period beginning from the date of the Terms Agreement
for such Securities and continuing to and including the earlier of (i) the
termination of trading restrictions for such Securities, as notified to the
Company by the Representatives and (ii) the Closing Date for such
Securities, not to offer, sell, contract to sell or otherwise dispose of
any debt securities of the Company which mature more than one year after
such Closing Date and which are substantially similar to such Securities.
5. The Company covenants and agrees with the several Underwriters that
the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Securities under the Act and all other
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expenses in connection with the preparation, printing and filing of the
Registration Statement, any preliminary prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or producing
any Agreement among Underwriters, this Agreement, any Terms Agreement, any
Indenture, any Blue Sky and Legal Investment Memoranda and any other documents
in connection with the offering, purchase, sale and delivery of the Securities;
(iii) all expenses in connection with the qualification of the Securities for
offering and sale under state securities laws as provided in Section 4(b)
hereof, including the fees and disbursements of counsel for the Underwriters in
connection with such qualification and in connection with the Blue Sky and legal
investment surveys; (iv) any fees charged by securities rating services for
rating the Securities; (v) any filing fees incident to any required review by
the National Association of Securities Dealers, Inc. of the terms of the sale of
the Securities; (vi) the cost of preparing the Securities; (vii) 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 any Indenture and
the Securities; and (viii) all other costs and expenses incident to the
performance of its obligations hereunder which are not otherwise specifically
provided for in this Section. It is understood, however, that, except as
provided in this Section, Section 7 and Section 10 hereof, the Underwriters will
pay all of their own costs and expenses, including the fees of their counsel,
transfer taxes on resale of any of the Securities by them, and any advertising
expenses connected with any offers they may make.
6. The obligations of the Underwriters of any Securities under the Terms
Agreement relating to such Securities shall be subject, in the discretion of the
Representatives, to the condition that all representations and warranties and
other statements of the Company herein are, at and as of the Closing Date for
such Securities, true and correct, the condition that the Company shall have
performed all of its obligations hereunder theretofore to be performed, and the
following additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant
to Rule 424(b) within the applicable time period prescribed for such filing
by the rules and regulations under the Act and in accordance with Section
4(a) of the Agreement; no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceeding for that
purpose shall have been initiated or threatened by the Commission; and all
requests for additional information on the part of the Commission shall
have been complied with to the Representatives' reasonable satisfaction;
(b) Xxxxxxx Xxxxxxx & Xxxxxxxx, counsel for the Underwriters, shall
have furnished to the Representatives such opinion or opinions, dated the
Closing Date for such
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Securities, with respect to the incorporation of the Company, the validity
of the Indenture, the Securities, the Registration Statement, the
Prospectus as amended or supplemented and other related matters as the
Representatives may reasonably request, and such counsel shall have
received such papers and information as they may reasonably request to
enable them to pass upon such matters;
(c) Friday, Xxxxxxxx & Xxxxx, counsel for the Company, shall have
furnished to the Representatives their written opinion, dated the Closing
Date for such Securities, in form and substance satisfactory to the
Representatives, 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 Delaware, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus as
amended or supplemented;
(ii) The Company has an authorized capitalization as set forth
in the Prospectus as amended or supplemented and all of the issued
shares of capital stock of the Company have been duly and validly
authorized and issued and are fully paid and non-assessable;
(iii) The Company has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
properties, or conducts any business, so as to require such
qualification (such counsel being entitled to rely in respect of the
opinion in this clause upon opinions of local counsel and in respect
of matters of fact upon certificates of officers of the Company,
provided that such counsel shall state that they believe that both the
Representatives and they are justified in relying upon such opinions
and certificates);
(iv) Each subsidiary of the Company has been duly incorporated
and is validly existing as a corporation in good standing under the
laws of its jurisdiction of incorporation and has been duly qualified
as a foreign corporation for the transaction of business and is in
good standing under the laws of each other jurisdiction in which it
owns or leases properties, or conducts any business, so as to require
such qualification; and all of the issued shares of capital stock of
each such subsidiary have been duly and validly authorized and issued,
are fully paid and nonassessable, and (except for directors'
qualifying shares) are owned directly or indirectly by the Company,
free and clear of all liens, encumbrances, equities or claims (such
counsel being entitled to rely in respect of the opinion in this
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clause upon opinions of local counsel and in respect of matters of
fact upon certificates of officers of the Company or its subsidiaries,
provided that such counsel shall state that they believe that both the
Representatives and they are justified in relying upon such opinions
and certificates);
(v) The Company and its subsidiaries have good and marketable
title in fee simple to all real property owned by them, in each case
free and clear of all liens, encumbrances and defects except such as
are described in the Prospectus or such as do not materially affect
the value of such property and do not interfere with the use made and
proposed to be made of such property by the Company and its
subsidiaries; and any real property and buildings held under lease by
the Company and its subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the use made and proposed to be
made of such property and buildings by the Company and its
subsidiaries (in giving the opinion in this clause, such counsel may
state that no examination of record titles for the purpose of such
opinion has been made, and that they are relying upon a general review
of the titles of the Company and its subsidiaries, upon opinions of
local counsel and abstracts, reports and policies of title companies
rendered or issued at or subsequent to the time of acquisition of such
property by the Company or its subsidiaries, upon opinions of counsel
to the lessors of such property and, in respect of matters of fact,
upon certificates of officers of the Company or its subsidiaries,
provided that such counsel shall state that they believe that both the
Representatives and they are justified in relying upon such opinions,
abstracts, reports, policies and certificates);
(vi) To the best of such counsel's knowledge there are no legal
or governmental proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property of the Company or any
of its subsidiaries is the subject, other than as set forth in the
Prospectus and other than litigation incident to the kind of business
conducted by the Company and its subsidiaries which individually and
in the aggregate is not material to the Company and its subsidiaries;
and to the best of such counsel's knowledge no such proceedings are
threatened or contemplated by governmental authorities or threatened
by others;
(vii) The Terms Agreement (including the provisions of this
Agreement) and any Delayed Delivery Contracts have been duly
authorized, executed and delivered by the Company;
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(viii) The Debt Securities have been duly authorized, executed,
issued and delivered by the Company and, upon payment and delivery in
accordance with the Terms Agreement, will constitute valid and legally
binding obligations of the Company enforceable against the Company in
accordance with their terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights and to
general equity principles, and entitled to the benefits provided by
the Indenture; and the Securities, other than any Contract Securities,
and the Indenture, if any, conform, and any Contract Securities, when
so issued and delivered and sold will conform, to the descriptions
thereof in the Prospectus as amended or supplemented;
(ix) The Class A Common Stock and the Additional Preferred
Stock, if any, described in the Terms Agreement have been duly and
validly authorized and issued and are fully paid and non-assessable;
(x) The Indenture, if any, has been duly authorized, executed
and delivered by the parties thereto and constitutes a valid and
legally binding instrument, enforceable in accordance with its terms,
subject, as to enforcement, to bankruptcy, insolvency, reorganization
and other similar laws of general
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applicability relating to or affecting creditors' rights and to
general equity principles; the Indenture has been duly qualified under
the Trust Indenture Act; and all taxes and fees required to be paid
with respect to the execution of the Indenture and the issuance of the
Securities have been paid;
(xi) The issue and sale of the Securities and the compliance by
the Company with all of the provisions of the Securities, the
Indenture, this Agreement and the Terms Agreement with respect to the
Securities and the consummation of the transactions herein and therein
contemplated will not conflict with or result in a breach of any of
the terms or provisions of, or constitute a default under, or result
in the creation or imposition of any lien, charge or encumbrance upon
any of the property or assets of the Company or any of its
subsidiaries pursuant to the terms of, any indenture, mortgage, deed
of trust, loan agreement or other agreement or instrument known to
such counsel to which the Company or any of its subsidiaries is a
party or by which the Company or any of its subsidiaries is bound or
to which any of the property or assets of the Company or any of its
subsidiaries is subject, nor will such action result in any violation
of the provisions of the Certificate of Incorporation, as amended, or
the By-Laws of the Company or any statute or any order, rule or
regulation known to such counsel of any court or governmental agency
or body having jurisdiction over the Company or any of its
subsidiaries or any of their properties; and no consent, approval,
authorization, order, registration or qualification of or with any
such court or any such regulatory authority or other governmental
agency or body is required for the issue and sale of the Securities or
the consummation of the other transactions contemplated by this
Agreement or such Terms Agreement or the Indenture, except such as
have been 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 Securities by the
Underwriters;
(xii) The documents incorporated by reference in the Prospectus
as amended or supplemented (other than the financial statements and
related schedules therein, as to which such counsel need express no
opinion), when they became effective or were filed with the
Commission, as the case may be, complied as to form in all material
respects with the requirements of the Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission
thereunder; and
(xiii) The Registration Statement and the Prospectus as amended
or supplemented and any further
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amendments and supplements thereto made by the Company prior to the
Closing Date for the Securities (other than the financial statements
and related schedules therein, as to which such counsel need express
no opinion) comply as to form in all material respects with the
requirements of the Act and the Trust Indenture Act and the rules and
regulations thereunder; they have no reason to believe that the
Registration Statement, as of the Effective Date (or, if an Annual
Report on Form 10-K of the Company has been filed subsequent to the
Effective Date and is deemed to be incorporated by reference therein,
as of the date of filing of the most recent such Annual Report on Form
10-K), contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading or that the Prospectus
(including any document incorporated by reference therein) contains an
untrue statement of a material fact or omits to state a material fact
required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading; and they do not know of any contracts or other
documents of a character required to be filed as an exhibit to the
Registration Statement or required to be incorporated by reference
into the Prospectus as amended or supplemented or required to be
described in the Registration Statement or the Prospectus as amended
or supplemented which are not filed or incorporated by reference or
described as required.
(d) At the Closing Date for such Securities, the independent
certified public accountants who have certified the financial statements of
the Company and its subsidiaries included or incorporated by reference in
the Registration Statement shall have furnished to the Representatives a
letter dated such Closing Date to the effect set forth in Annex III hereto,
and as to such other matters as the Representatives may reasonably request
and in form and substance satisfactory to the Representatives;
(e) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus as amended or
supplemented any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or
from any labor dispute or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the Prospectus as amended or
supplemented, and (ii) since the respective dates as of which information
is given in the Prospectus as amended or supplemented there shall not have
been any change in the capital stock or long-term debt of the Company or
any of its subsidiaries or any change, or any development involving a
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prospective change, in or affecting the general affairs, management,
financial position, stockholders' equity or results of operations of the
Company and its subsidiaries, otherwise than as set forth or contemplated
in the Prospectus as amended or supplemented, the effect of which, in any
such case described in Clause (i) or (ii), is in the judgment of the
Representatives so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the
Securities or the Registered Securities on the terms and in the manner
contemplated in the Prospectus as amended or supplemented;
(f) On or after the date of the Terms Agreement, there shall not have
occurred (i) any downgrading in the rating accorded the Company's debt
securities by any "nationally recognized statistical rating organization,"
as that term is defined by the Commission for purposes of Rule 436(g)(2)
under the Act or (ii) 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 judgment of a majority in
interest of the Underwriters, including any Representatives, materially
impairs the investment quality of the Securities or the Registered
Securities;
(g) On or after the date of the Terms Agreement relating to the
Securities there shall not have occurred any of the following: (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., the Chicago
Board Options Exchange, the Chicago Mercantile Exchange or the Chicago
Board of Trade, (ii) trading of any securities of the Company shall have
been suspended on any exchange or in any over-the-counter market, (iii) a
general moratorium on commercial banking activities in New York shall have
been declared by either Federal or New York State authorities, or (iv)
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 or adverse, if the effect of any such event specified
in clauses (i) through (iv), singly or together with any other such event
makes it, in your judgment, impracticable to market the Securities on the
terms and in the manner contemplated in the Prospectus as amended or
supplemented; and
(h) The Company shall have furnished or caused to be furnished to the
Representatives at the Closing Date for the Securities a certificate or
certificates of officers of the Company satisfactory to the Representatives
as to the accuracy of the representations and warranties of the Company
herein at and as of such Closing Date, as to the performance by the Company
of all of its obligations hereunder to be performed at or prior to such
Closing Date, as to the matters set forth in subsections (a) and (e) of
14
this Section and as to such other matters as the Representatives may
reasonably request.
7. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any related preliminary prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Securities, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will
reimburse each Underwriter for any legal or other expenses reasonably incurred
by such Underwriter in connection with investigating or defending any such
action or claim; provided, however, that the Company shall not be liable in any
such case to the extent that any such loss, claim, damage or liability arises
out of or is based upon an untrue statement or alleged untrue statement or
omission or alleged omission made in any related preliminary prospectus, any
preliminary prospectus supplement, the Registration Statement, the Prospectus as
amended or supplemented and any other prospectus relating to the Securities, or
any such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by any Underwriter of Securities through
the Representatives expressly for use in the Prospectus as amended or
supplemented relating to such Securities; provided further, that as to any
related preliminary prospectus or preliminary prospectus supplement this
indemnity agreement shall not inure to the benefit of any Underwriter on account
of any loss, claim, damage or liability (or action in respect thereof) arising
from the sale of the Securities to any person by that Underwriter if that
Underwriter failed to send or give a copy of the Prospectus, as the same may be
amended or supplemented, to that person within the time required by the Act, and
the untrue statement or alleged untrue statement of any material fact or
omission or alleged omission to state any material fact in such preliminary
prospectus or preliminary prospectus supplement was corrected in the Prospectus,
unless such failure resulted from non-compliance by the Company with Section
4(c). For purposes of the second proviso to the immediately preceding sentence,
the term Prospectus shall not be deemed to include the documents incorporated by
reference therein, and no Underwriter shall be obligated to send or give any
supplement or amendment to any document incorporated by reference in a
preliminary prospectus, a preliminary prospectus
15
supplement or the Prospectus to any person other than a person to whom such
Underwriter has delivered such incorporated documents in response to a written
request therefor.
(b) Each Underwriter will indemnify and hold harmless the Company against
any losses, claims, damages or liabilities to which the Company may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
related preliminary prospectus, any preliminary prospectus supplement, the
Registration Statement, the Prospectus as amended or supplemented and any other
prospectus relating to the Securities, or any amendment or supplement thereto,
or arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in any related preliminary prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Securities, or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through the
Representatives expressly for use therein; and will reimburse the Company for
any legal or other expenses reasonably incurred by the Company in connection
with investigating or defending any such action or claim.
(c) Promptly after receipt by an indemnified party under subsection (a) or
(b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal
16
expenses of other counsel or any other expenses, in each case subsequently
incurred by such indemnified party, in connection with the defense thereof other
than reasonable costs of investigation.
(d) If the indemnification provided for in this Section 7 is unavailable
to or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above in respect of any losses, claims, damages or liabilities (or actions
in respect thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
in such proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and the Underwriters of the Securities on the
other from the offering of the Securities to which such loss, claim, damage or
liability (or action in respect thereof) relates. If, however, the allocation
provided by the immediately preceding sentence is not permitted by applicable
law or if the indemnified party failed to give the notice required under
subsection (c) above, then each indemnifying party shall contribute to such
amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Company on the one hand and the Underwriters of the Securities on
the other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities (or actions in respect thereof), as well
as any other relevant equitable considerations. The relative benefits received
by the Company on the one hand and such Underwriters on the other shall be
deemed to be in the same proportion as the total net proceeds from such offering
(before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by such Underwriters. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company on the one hand or such Underwriters on the other and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company and the Underwriters agree that
it would not be just and equitable if contribution pursuant to this subsection
(d) were determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to above in
this subsection (d). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages or liabilities (or actions in respect
thereof) referred to above in this subsection (d) shall be deemed to
17
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the applicable Securities underwritten by it and distributed to
the public were offered to the public exceeds the amount of any damages which
such Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The obligations of the Underwriters of Securities
in this subsection (d) to contribute are several in proportion to their
respective underwriting obligations with respect to such Securities and not
joint.
(e) The obligations of the Company under this Section 7 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section 7 shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each officer and director of the Company and to each
person, if any, who controls the Company within the meaning of the Act.
8. (a) If any Underwriter shall default in its obligation to purchase
the Securities which it has agreed to purchase under the Terms Agreement
relating to such Securities, the Representatives may in their discretion arrange
for themselves or another party or other parties to purchase such Securities on
the terms contained herein. If within thirty-six hours after such default by any
Underwriter the Representatives do not arrange for the purchase of such
Securities, then the Company shall be entitled to a further period of thirty-six
hours within which to procure another party or other parties satisfactory to the
Representatives to purchase such Securities on such terms. In the event that,
within the respective prescribed period, the Representatives notify the Company
that they have so arranged for the purchase of such Securities, or the Company
notifies the Representatives that it has so arranged for the purchase of such
Securities, the Representatives or the Company shall have the right to postpone
the Closing Date for such Securities for a period of not more than seven days,
in order to effect whatever changes may thereby be made necessary in the
Registration Statement or the Prospectus as amended or supplemented, or in any
other documents or arrangements, and the Company agrees to file
18
promptly any amendments or supplements to the Registration Statement or the
Prospectus which in the opinion of the Representatives may thereby be made
necessary. The term "Underwriter" as used in this Agreement shall include any
person substituted under this Section with like effect as if such person had
originally been a party to the Terms Agreement with respect to such Securities.
(b) If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Underwriter or Underwriters by the Representatives
and the Company as provided in subsection (a) above, the aggregate principal
amount of such Securities which remains unpurchased does not exceed one-eleventh
of the aggregate principal amount of the Securities, then the Company shall have
the right to require each non-defaulting Underwriter to purchase the principal
amount of Securities which such Underwriter agreed to purchase under the Terms
Agreement relating to such Securities and, in addition, to require each non-
defaulting Underwriter to purchase its pro rata share (based on the principal
amount of Securities which such Underwriter agreed to purchase under such Terms
Agreement) of the Securities of such defaulting Underwriter or Underwriters for
which such arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Underwriter or Underwriters by the Representatives
and the Company as provided in subsection (a) above, the aggregate principal
amount of Securities which remains unpurchased exceeds one-eleventh of the
aggregate principal amount of the Securities, as referred to in subsection (b)
above, or if the Company shall not exercise the right described in subsection
(b) above to require non-defaulting Underwriters to purchase Securities of a
defaulting Underwriter or Underwriters, then the Terms Agreement relating to
such Securities shall thereupon terminate, without liability on the part of any
non-defaulting Underwriter or the Company, except for the expenses to be borne
by the Company and the Underwriters as provided in Section 5 hereof and the
indemnity and contribution agreements in Section 7 hereof; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
9. The respective indemnities, agreements, representations, warranties
and other statements of the Company and the several Underwriters, as set forth
in this Agreement or made by or on behalf of them, respectively, pursuant to
this Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter, or the Company,
or any officer or director or
19
controlling person of the Company, and shall survive delivery of and payment for
the Securities.
Anything herein to the contrary notwithstanding, the indemnity agreement of
the Company in subsection (a) of Section 7 hereof, the representations and
warranties in subsection (b) of Section 2 hereof and any representation or
warranty as to the accuracy of the Registration Statement or the Prospectus
contained in any certificate furnished by the Company pursuant to Section 6
hereof, insofar as they may constitute a basis for indemnification for
liabilities (other than payment by the Company of expenses incurred or paid in
the successful defense of any action, suit or proceeding) arising under the Act,
shall not extend to the extent of any interest therein of a controlling person
or partner of an Underwriter who is a director, officer or controlling person of
the Company when the Registration Statement became effective, except in each
case to the extent that an interest of such character shall have been determined
by a court of appropriate jurisdiction as not against public policy as expressed
in the Act. Unless in the opinion of counsel for the Company the matter has
been settled by controlling precedent, the Company will, if a claim for such
indemnification is asserted, submit to a court of appropriate jurisdiction the
question whether such interest is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
10. If any Terms Agreement shall be terminated pursuant to Section 8
hereof, the Company shall not then be under any liability to any Underwriter
with respect to the Securities covered by such Terms Agreement except as
provided in Section 5 and Section 7 hereof; but, if for any other reason
Securities are not delivered by or on behalf of the Company as provided herein,
the Company will reimburse the Underwriters through the Representatives for all
out-of-pocket expenses approved in writing by the Representatives, including
fees and disbursements of counsel, reasonably incurred by the Underwriters in
making preparations for the purchase, sale and delivery of such Securities, but
the Company shall then be under no further liability to any Underwriter with
respect to such Securities except as provided in Section 5 and Section 7 hereof.
11. In all dealings hereunder, the Representatives of the Underwriters of
Securities shall act on behalf of each of such Underwriters, and the parties
hereto shall be entitled to act and rely upon any statement, request, notice or
agreement on behalf of any Underwriter made or given by such Representatives
jointly or by such of the Representatives, if any, as may be designated for such
purpose in the Terms Agreement.
20
All statements, requests, notices and agreements hereunder shall be in
writing or by telegram if promptly confirmed in writing, and if to the
Underwriters shall be sufficient in all respects if delivered or sent by
registered mail to the address of the Representatives as set forth in the Terms
Agreement; and if to the Company shall be sufficient in all respects if
delivered or sent by registered mail to Xxxxxxx'x, Inc., 0000 Xxxxxxxx Xxxx,
Xxxxxx Xxxx, Xxxxxxxx 00000, Attention: Treasurer; provided, however, that any
notice to an Underwriter pursuant to Section 7(c) hereof shall be delivered or
sent by registered mail to such Underwriter at the address set forth in the
Terms Agreement.
12. This Agreement and each Terms Agreement shall be binding upon, and
inure solely to the benefit of, the Underwriters, the Company and, to the extent
provided in Section 7 and Section 9 hereof, the officers and directors of the
Company and each person who controls the Company or any Underwriter, and their
respective heirs, executors, administrators, successors and assigns, and no
other person shall acquire or have any right under or by virtue of this
Agreement or any such Terms Agreement. No purchaser of any of the Securities
from any Underwriter shall be deemed a successor or assign by reason merely of
such purchase.
13. Time shall be of the essence of each Terms Agreement. As used herein
the term "business day" shall mean any day when the Commission's office in
Washington, D.C. is normally open for business.
14. This Agreement and each Terms Agreement shall be construed in
accordance with the laws of the State of New York.
15. This Agreement and each Terms Agreement may be executed by any one or
more of the parties hereto and thereto in any number of counterparts, each of
which shall be deemed to be an original, but all such respective counterparts
shall together constitute one and the same instrument.
-------------------
ANNEX I
(Three copies of this Delayed Delivery Contract should be signed and returned to
the address shown below so as to arrive not later than 9:00 A.M., New York time,
on _______________ __, 19__*.)
DELAYED DELIVERY CONTRACT
-------------------------
[Insert date of
initial public
offering]
XXXXXXX'X, INC.
c/o [Name and address
of Underwriter[s]]
Gentlemen:
The undersigned hereby agrees to purchase from XXXXXXX'X, INC. ("Company"),
and the Company agrees to sell to the undersigned, [If one delayed closing,
-----------------------
insert---as of the date hereof, for delivery on __________________, 19__
------
("Delivery Date"),]
[$] _______________________________
principal amount of the Company's [Insert title of securities] ("Securities"),
--------------------------
offered by the Company's Prospectus dated __________________, 19__ and a
Prospectus Supplement dated _________, 19__, relating thereto, receipt of copies
of which is hereby acknowledged, at __% of the principal amount thereof plus
accrued interest from __________________, 19__, if any, and on the further terms
and conditions set forth in this Delayed Delivery Contract ("Contract").
[If two or more delayed closings, insert the following:
-----------------------------------------------------
The undersigned will purchase from the Company as of the date hereof, for
delivery on the dates set forth below, Securities in the principal amounts set
forth below:
Delivery Date Principal Amount
------------- ----------------
________________________ [$]_____________
________________________ [$]_____________
------------------------
*/ Insert date which is third full business day prior to Closing Date under the
-
Terms Agreement.
2
Each of such delivery dates is hereinafter referred to as a Delivery Date.]
Payment for the Securities that the undersigned has agreed to purchase for
delivery on---the--each--Delivery Date shall be made to the Company or its order
by wire transfer of immediately available funds to a bank account designated by
the Company upon delivery to the undersigned of the Securities to be purchased
by the undersigned---for delivery on such Delivery Date--in definitive fully
registered form and in such denominations and registered in such names as the
undersigned may designate by written or telegraphic communication addressed to
the Company not less than three full business days prior to--the---such--
Delivery Date.
It is expressly agreed that the provisions for delayed delivery and payment
are for the sole convenience of the undersigned; that the purchase hereunder of
Securities is to be regarded in all respects as a purchase as of the date of
this Contract; that the obligation of the Company to make delivery of and accept
payment for, and the obligation of the undersigned to take delivery of and make
payment for, Securities on--the--each--Delivery Date shall be subject only to
the conditions that (1) investment in the Securities shall not at--the--such--
Delivery Date be prohibited under the laws of any jurisdiction in the United
States to which the undersigned is subject and (2) the Company shall have sold
to the Underwriters the total principal amount of the Securities less the
principal amount thereof covered by this and other similar Contracts. The
undersigned represents that its investment in the Securities is not, as of the
date hereof, prohibited under the laws of any jurisdiction to which the
undersigned is subject and which governs such investment.
Promptly after completion of the sale to the Underwriters the Company will
mail or deliver to the undersigned at its address set forth below, notice to
such effect, accompanied by a copy of the opinion of counsel for the Company
delivered to the Underwriters in connection therewith.
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.
It is understood that the acceptance of any such Contract 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 below and
3
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.
Yours very truly,
--------------------------------
(Name of purchaser)
By _____________________________
--------------------------------
(Title of Signatory)
--------------------------------
--------------------------------
(Address of Purchaser)
Accepted, as of the above date,
XXXXXXX'X, INC.
By____________________________
Name:
Title:
ANNEX II (A)
XXXXXXX'X, INC.
("Company")
Debt Securities
TERMS AGREEMENT
---------------
,19__
Xxxxxxx'x, Inc.
X.X. Xxx 000
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: Vice President and Treasurer
Dear Sirs:
[On behalf of the several Underwriters named in Schedule A hereto and for
their respective accounts, we] [We] offer to purchase, on and subject to the
terms and conditions of the Underwriting Agreement Basic Provisions filed as an
exhibit to the Company's registration statement on Form S-3 (No. 333-___)
("Underwriting Agreement"), the following securities ("Securities") to be issued
under an indenture, dated ________, 19__, between the Company and
_______________, as Trustee, on the following terms:
Title: [ %] [Floating Rate] [Zero Coupon] [Notes] [Debentures]
-----
Due ___
Aggregate Principal Amount: [$]
--------------------------
Interest: [ % per annum, from , 19 , payable semiannually on
--------
and commencing , 19 , to holders of record on the preceding
or
, as the case may be.]
[Describe any deferral provisions]
Maturity: , 19 .
--------
Redemption:
----------
[No provisions for redemption]
[The Securities may be redeemed, otherwise than through the sinking fund, in
whole or in part at the option of the
Company, in the amount of $ or
an integral multiple thereof, [on or after , at the
following redemption prices (expressed in percentages of principal
amount).] If [redeemed on or before , %, and if] redeemed
during the 12-month period beginning
REDEMPTION
YEAR PRICE
---- ----------
and thereafter at 100% of their principal amount, together in each case with
accrued interest to the redemption date.]
[on any interest payment date falling in or after , ,
at the election of the Company, at a redemption price equal to the principal
amount thereof, plus accrued interest to the date of redemption.]
[Other possible redemption provisions, such as mandatory redemption upon
occurrence of certain events or redemption for changes in tax law]
[Restriction on refunding]
Sinking Fund:
------------
[No sinking fund provisions]
[The Securities are entitled to the benefit of a sinking fund to retire $
principal amount of Securities on in each of the years through
at 100% of their principal amount plus accrued interest] [, together with
[cumulative] [noncumulative] redemptions at the option of the Company to
retire an additional $ principal amount of Securities in the years
through at 100% of their principal amount plus accrued interest].
[Other Terms]
Delayed Delivery contracts: [None.] [Delivery Date[s] shall be
-------------------------- , 19 .
Underwriters' fee is % of the principal amount of the Contract Securities.]
Purchase Price: % of the principal amount of the Securities, plus accrued
--------------
interest from to [and accrued amortization, if any, from to ]
2
Expected Reoffering Price: % of the principal amount of the Securities,
-------------------------
plus accrued interest from to [and
accrued amortization, if any, from to ]
Closing Date: A.M. on , 19 , at
------------
_____________________ in New York
Federal (same-day) funds.
[Name[s] and Address[es] of Representative[s]:]
--------------------------------------------
The respective principal amounts of the Securities to be purchased by each of
the Underwriters are set forth opposite their names in Schedule A hereto.
[If Securities are extendable debt Securities, insert ---
Extendable provisions:
---------------------
Securities are repayable on , [insert date and years], at the
option of the holder, at their principal amount with accrued interest.
Initial annual interest rate will be %, and thereafter annual
interest rate will be adjusted on , and to a rate not
less than % of the effective annual interest rate on U.S. Treasury
obligations with -year maturities as of the [insert date 15 days
prior to maturity date] prior to such [insert maturity date].]
[If Securities are Floating Rate debt Securities, insert--
Floating rate provisions:
------------------------
Initial annual interest rate will be % through [and
thereafter will be adjusted [monthly] [on each , ,
and ] [to an annual rate of % above the average rate for
-year
3
[month] [securities] [certificates of deposit] by and [insert
names of banks].] [and the annual interest rate [thereafter] [from,
through ] will be the interest yield equivalent of the weekly
average per annum market discount rate for -month Treasury bills plus
% of Interest Differential (the excess, if any, of (i) then current weekly
average per annum secondary market yield for -month certificates of
deposit over (ii) then current interest yield equivalent of the weekly
average per annum market discount rate for -month Treasury bills);
[from and thereafter the rate will be the then current interest yield
equivalent plus % of Interest Differential ].]
[If appropriate, insert--It is understood that we may, with your
----------------------
consent, amend this offer to add additional Underwriters and reduce the
aggregate principal amount to be purchased by the Underwriters listed in
Schedule A hereto by the aggregate principal amount to be purchased by such
additional Underwriters.]
The provisions of the Underwriting Agreement are incorporated herein
by reference [If appropriate, insert--, except that the obligations and
----------------------
agreements set forth in Section 8 ("Default of Underwriters") of the
Underwriting Agreement shall not apply to the obligations of the Underwriters to
purchase the above Securities].
The Securities will be made available for checking and packaging at
the office of at least 24 hours prior to the Closing Date.
[Please signify your acceptance of our offer by signing the enclosed
response to us in the space provided and returning it to us.]
5
[Please signify your acceptance of the aforegoing by return wire not
later than P.M. today.]
Very truly yours,
[Insert name(s) of Representatives
or Underwriters] [On behalf of-- themselves--itself---
and as
Representative[s] of the Several]
[As] Underwriters[s]
[By [Name of Representative]]
By______________________________
Name:
Title:
SCHEDULE A
Principal
Underwriter Amount
----------- ---------
---------
Total. . . . . . . . . . . . . . . . . . . . . . [$]
=========
To: [Insert name(s) of Representatives
or Underwriters]
As [Representative[s] of the Several]
Underwriter[s],
[c/o [Name of Representative]]
We accept the offer contained in your [letter] [wire], dated , 19
, relating to [$]__________ principal amount of our [Insert title of
---------------
Securities]. We also confirm that, to the best of our knowledge after
----------
reasonable investigation, the representations and warranties of the undersigned
in the Underwriting Agreement filed as an exhibit to the undersigned's
registration statement on Form S-3 (No. 333-_____) ("Underwriting Agreement")
are true and correct, no stop order suspending the effectiveness of the
Registration Statement (as defined in the Underwriting Agreement) or of any part
thereof has been issued and no proceedings for that purpose have been instituted
or, to the knowledge of the undersigned, are contemplated by the Securities and
Exchange Commission and, subsequent to the respective dates of the most recent
financial statements in the Prospectus (as defined in the Underwriting
Agreement), there has been (or in the case of a form of prospectus filed
pursuant to Rule 424(b)(1) or (4) there will be, as of the date of such
prospectus) no material adverse change in the financial position or results of
operations of the undersigned and its subsidiaries except as set forth in or
contemplated by the Prospectus.
Very truly yours,
XXXXXXX'X, INC.
By________________________________
Name:
Title:
ANNEX II (B)
XXXXXXX'X, INC.
("Company")
Equity Securities
TERMS AGREEMENT
---------------
,19__
Xxxxxxx'x, Inc.
X.X. Xxx 000
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: Vice President and Treasurer
Dear Sirs:
[On behalf of the several Underwriters named in Schedule A hereto and for
their respective accounts, we] [We] offer to purchase, on and subject to the
terms and conditions of the Underwriting Agreement Basic Provisions filed as an
exhibit to the Company's registration statement on Form S-3 (No. 333-___)
("Underwriting Agreement"), the following securities ("Securities") on the
following terms:
Title: [Class A Common Stock] [Additional Preferred Stock, Series ______]
-----
Number of Shares to be issued: [______ shares]
-----------------------------
[For Additional Preferred Stock:
Voting Rights:
-------------
Additional Preferred Stock Dividends: [cash dividends of $ to $ per share
------------------------------------
payable quarterly in arrears on _____ __, ______ __, _______ __ and _______ __.]
Optional Redemption:
-------------------
[No provisions for redemption]
[The Securities may be redeemed, otherwise than through the sinking fund, in
whole or in part at the option of the Company, in the amount of $ or
an integral multiple thereof, [on or after , at the
following redemption prices (expressed in percentages of principal
amount).] If [redeemed on or before , %, and if] redeemed
during the 12-month period beginning
2
REDEMPTION
YEAR PRICE
---- ----------
and thereafter at 100% of their principal amount, together in each case
with accrued interest to the redemption date.]
[on any interest payment date falling in or after , ,
at the election of the Company, at a redemption price equal to the
principal amount thereof, plus accrued interest to the date of redemption.]
[Other possible redemption provisions, such as mandatory redemption upon
occurrence of certain events or redemption for changes in tax law]
[Restriction on refunding]
Mandatory Redemption/Sinking Fund:
---------------------------------
[No sinking fund provisions]
[The Securities are entitled to the benefit of a sinking fund to retire
$ principal amount of Securities on in each of the
years through at 100% of their principal amount plus accrued
interest] [, together with [cumulative] [noncumulative] redemptions at the
option of the Company to retire an additional $ principal amount
of Securities in the years through at 100% of their
principal amount plus accrued interest].
Liquidation Preference: [$ per share plus ].
----------------------
Name of Exchange or Market: [New York Stock Exchange] [NASDAQ National
--------------------------
Market System] [American Stock Exchange]
[Period Designated Pursuant to Section 4(e) of the Underwriting Agreement:
-------------------------------------------------------------------------
______ days.]
[Other Terms]
Price to Public: $________ per share
---------------
3
Underwriting Discounts and Commission:
-------------------------------------
Proceeds to Company:
-------------------
Over-Allotment Option:
---------------------
Closing Date: A.M. on , 19 , at
------------
_____________________ in New York
Federal (same-day) funds.
Name of Transfer Agent and Registrar:
------------------------------------
[Name[s] and Address[es] of Representative[s]:]]
--------------------------------------------
[For Class A Common Stock:
Name of Exchange or Market: [New York Stock Exchange] [NASDAQ National
--------------------------
Market System] [American Stock Exchange]
[Period Designated Pursuant to Section 4(e) of the Underwriting Agreement:
------------------------------------------------------------------------
______ days.]
[Other Terms]
Price to Public: $________ per share
---------------
Underwriting Discounts and Commission:
-------------------------------------
Proceeds to Company:
-------------------
Over-Allotment Option:
---------------------
Closing Date: A.M. on , 19 , at
------------
_____________________ in New York
Federal (same-day) funds.
Name of Transfer Agent and Registrar:
------------------------------------
[Name[s] and Address[es] of Representative[s]:]]
--------------------------------------------
The respective shares of the Securities to be purchased by each of the
Underwriters are set forth opposite their names in Schedule A hereto.
[If appropriate, insert--It is understood that we may, with your consent,
----------------------
amend this offer to add additional Underwriters and reduce the number of shares
to be purchased by the Underwriters listed in Schedule A hereto by the number of
shares to be purchased by such additional Underwriters.]
4
The provisions of the Underwriting Agreement are incorporated herein by
reference [If appropriate, insert--, except that the obligations and agreements
----------------------
set forth in Section 8 ("Default of Underwriters") of the Underwriting Agreement
shall not apply to the obligations of the Underwriters to purchase the above
Securities].
The Securities will be made available for checking and packaging at the
office of at least 24 hours prior to the Closing Date.
[Please signify your acceptance of our offer by signing the enclosed
response to us in the space provided and returning it to us.]
5
[Please signify your acceptance of the aforegoing by return wire not later
than P.M. today.]
Very truly yours,
[Insert name(s) of Representatives
or Underwriters] [On behalf of-- themselves--itself---
and as
Representative[s] of the Several]
[As] Underwriters[s]
[By [Name of Representative]]
By______________________________
Name:
Title:
SCHEDULE A
Number of
Underwriter Shares
----------- ---------
---------
Total. . . . . . . . . . . . . . . . . . . . . .
=========
To: [Insert name(s) of Representatives
or Underwriters]
As [Representative[s] of the Several]
Underwriter[s],
[c/o [Name of Representative]]
We accept the offer contained in your [letter] [wire], dated ,
19 , relating to ____________ shares of our [Insert title of Securities] (the
--------------------------
"Terms Agreement"). We also confirm that, to the best of our knowledge after
reasonable investigation, the representations and warranties of the undersigned
in the Underwriting Agreement Basic Provisions filed as an exhibit to the
undersigned's registration statement on Form S-3 (No. 333-_____) (together with
the Terms Agreement, the "Underwriting Agreement") are true and correct, no stop
order suspending the effectiveness of the Registration Statement (as defined in
the Underwriting Agreement) or of any part thereof has been issued and no
proceedings for that purpose have been instituted or, to the knowledge of the
undersigned, are contemplated by the Securities and Exchange Commission and,
subsequent to the respective dates of the most recent financial statements in
the Prospectus (as defined in the Underwriting Agreement), there has been (or in
the case of a form of prospectus filed pursuant to Rule 424(b)(1) or (4) there
will be, as of the date of such prospectus) no material adverse change in the
financial position or results of operations of the undersigned and its
subsidiaries except as set forth in or contemplated by the Prospectus.
Very truly yours,
XXXXXXX'X, INC.
By________________________________
Name:
Title:
ANNEX III
Pursuant to Section 6 (d) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with respect
to the Company and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules examined by them and
included or incorporated by reference in the Registration Statement or the
Prospectus comply as to form in all material respects with the applicable
accounting requirements of the Act or the Exchange Act, as applicable, and
the related published rules and regulations thereunder; and, if applicable,
they have made a review in accordance with standards established by the
American Institute of Certified Public Accountants of the consolidated
interim financial statements, selected financial data, pro forma financial
information and/or condensed financial statements derived from audited
financial statements of the Company for the periods specified in such
letter, as indicated in their reports thereon, copies of which have been
furnished to the representatives of the Underwriters (the
"Representatives");
(iii) The unaudited selected financial information with respect to
the consolidated results of operations and financial position of the
Company for the five most recent fiscal years included in the Prospectus
and included or incorporated by reference in Item 6 of the Company's Annual
Report on Form 10-K for the most recent fiscal year agrees with the
corresponding amounts (after restatement where applicable) in the audited
consolidated financial statements for five such fiscal years which were
included or incorporated by reference in the Company's Annual Reports on
Form 10-K for such fiscal years;
(iv) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company and its subsidiaries, inspection of the
minute books of the Company and its subsidiaries since the date of the
latest audited financial statements included or incorporated by
2
reference in the Prospectus, inquiries of officials of the Company and its
subsidiaries responsible for financial and accounting matters and such
other inquiries and procedures as may be specified in such letter, nothing
came to their attention that caused them to believe that:
(A) the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of changes in
financial position included or incorporated by reference in the
Company's Quarterly Reports on Form 10-Q incorporated by reference in
the Prospectus do not comply as to form in all material respects with
the applicable accounting requirements of the Exchange Act as it
applies to Form 10-Q and the related published rules and regulations
thereunder or are not in conformity with generally accepted accounting
principles applied on a basis substantially consistent with the basis
for the audited consolidated statements of income, consolidated
balance sheets and consolidated statements of changes in financial
position included or incorporated by reference in the Company's Annual
Report on Form 10-K for the most recent fiscal year;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the corresponding
items in the unaudited consolidated financial statements from which
such data and items were derived, and any such unaudited data and
items were not determined on a basis substantially consistent with the
basis for the corresponding amounts in the audited consolidated
financial statements included or incorporated by reference in the
Company's Annual Report on Form 10-K for the most recent fiscal year;
(C) the unaudited financial statements which were not included
in the Prospectus but from which were derived the unaudited condensed
financial statements referred to in clause (A) and any unaudited
income statement data and balance sheet items included in the
Prospectus and referred to in Clause (B) were not determined on a
basis substantially consistent with the basis for the audited
financial statements included or incorporated by reference in the
Company's Annual Report on Form 10-K for the most recent fiscal year;
(D) any unaudited pro forma consolidated condensed financial
statements included or incorporated by reference in the Prospectus do
not
3
comply as to form in all material respects with the applicable
accounting requirements of the Act and the published rules and
regulations thereunder or the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of those
statements;
(E) as of a specified date not more than five days prior to the
date of such letter, there have been any changes in the consolidated
capital stock (other than issuances of capital stock upon exercise of
options and stock appreciation rights, upon earn-outs of performance
shares and upon conversions of convertible securities, in each case
which were outstanding on the date of the latest balance sheet
included or incorporated by reference in the Prospectus) or any
increase in the consolidated long-term debt of the Company and its
subsidiaries, or any decreases in consolidated net current assets or
net assets or other items specified by the Representatives, or any
increases in any items specified by the Representatives, in each case
as compared with amounts shown in the latest balance sheet included or
incorporated by reference in the Prospectus, except in each case for
changes, increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter; and
(F) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus to
the specified date referred to in Clause (E) there were any decreases
in consolidated net sales or income before income taxes or the total
or per share amounts of consolidated net income or other items
specified by the Representatives, any increases in the ratio of
administrative and general expenses or interest expense to net sales,
or any increases in any items specified by the Representatives, in
each case as compared with the comparable period of the preceding year
and with any other period of corresponding length specified by the
Representatives, except in each case for increases or decreases which
the Prospectus discloses have occurred or may occur or which are
described in such letter; and
(v) In addition to the examination referred to in their report(s)
included or incorporated by reference in the Prospectus and the limited
procedures, inspection of minute books, inquiries and other procedures
referred to
4
in paragraphs (iii) and (iv) above, they have carried out certain specified
procedures, not constituting an examination in accordance with generally
accepted auditing standards, with respect to certain amounts, percentages
and financial information specified by the Representatives which are
derived from the general accounting records of the Company and its
subsidiaries, which appear in the Prospectus (excluding documents
incorporated by reference), or in Part II of, or in exhibits and schedules
to, the Registration Statement specified by the Representatives or in
documents incorporated by reference in the Prospectus specified by the
Representatives, and have compared certain of such amounts, percentages and
financial information with the accounting records of the Company and its
subsidiaries and have found them to be in agreement.
All references in this Annex III to the Prospectus shall be deemed to refer
to the Prospectus as amended or supplemented (including the documents
incorporated by reference therein) in relation to the applicable Securities for
purposes of the letter delivered at the Closing Date for such Securities.
