EXHIBIT 1.1
XXX XXXXXXXX XXXXXXX
(a Delaware Corporation)
[Title]
TERMS AGREEMENT
___________, 200[*]
To: XXX XXXXXXXX XXXXXXX
Prudential Xxxxx Xxxxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Ladies and Gentlemen:
We (the "Lead Underwriter") are acting on behalf of the underwriter or
underwriters (including ourselves) named below (such underwriter or underwriters
being herein called the "Underwriters", which term shall include any Underwriter
substituted pursuant to Section 10 of the Standard Provisions (as hereinafter
defined)), and we understand that Xxx Xxxxxxxx Xxxxxxx, a Delaware corporation
(the "Company"), proposes to issue and sell $[*] aggregate principal amount of
its [Title] (the "Offered Securities"). Subject to the terms and conditions set
forth or incorporated by reference herein, the Company hereby agrees to sell to
each Underwriter, and each Underwriter agrees to purchase, severally and not
jointly, from the Company, the aggregate principal amount of Offered Securities
opposite its name set forth below:
Principal Amount
Underwriter of Offered Securities
--------------------------------------------------------------------------------
$
-------------
Total $
=============
Payment of the purchase price for, and delivery of certificates for,
the Offered Securities shall be made at the office of [Sidley Xxxxxx Xxxxx &
Xxxx LLP, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000] or at such other place
as shall be agreed upon by the Lead Underwriter and the Company, at 9:00 a.m.
(Eastern time) on the fifth business day after the date of this
Terms Agreement (unless postponed in accordance with the provisions of Section
10 of the Standard Provisions), or such other time not later than ten business
days after such date as shall be agreed upon by the Lead Underwriter and the
Company (such time and date of payment and delivery being herein called the
"Closing Time").
Notices to the Underwriters shall be directed to the Lead Underwriter,
[Address], attention: [*], Telecopy No.: [*] (with a copy to the General
Counsel).
The Offered Securities shall have the terms set forth in the prospectus
dated _______________, 2002, and the prospectus supplement dated ______________
200[*], including the following:
[Title]
Title:
Rank:
Aggregate principal amount:
Denominations:
Currency of payment:
Interest rate or formula:
Interest payment dates: ________________, commencing ___________
Regular record dates:
Stated maturity date:
Redemption provisions:
Sinking fund requirements:
Listing requirements:
Black-out provisions:
Fixed or Variable Price Offering: [Fixed] [Variable] Price Offering
If Fixed Price Offering, initial public offering price: % of the
principal amount[, plus accrued interest [amortized original issue
discount], if any, from _____________ to the Closing Time.]
Purchase price: _____________% of principal amount[, plus accrued interest
[amortized original issue discount], if any, from _______________ to the Closing
Time.]
Form:
Other terms and conditions:
Except as set forth below, all provisions contained in the document
entitled Xxx Xxxxxxxx Xxxxxxx Underwriting Agreement Standard Provisions dated
November __, 2002 (the "Standard Provisions"), a copy of which is attached
hereto, are herein incorporated by reference in their entirety and shall be
deemed to be part of this Terms Agreement to the same extent as if such
provisions had been set forth in full in this Terms Agreement, except that (i)
if any term defined in the Standard Provisions is otherwise defined in this
Terms Agreement, the definition set forth in this Terms Agreement shall control,
and (ii) if only one Underwriter is named in this
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Terms Agreement, all references in the Standard Provisions to the Lead
Underwriter shall mean the Underwriter named in this Terms Agreement. This Terms
Agreement, including the Standard Provisions incorporated by reference herein,
is referred to as this "Agreement."
Please accept this offer no later than ____ o'clock p.m. (New York City
time) on ______________ by signing a copy of this Terms Agreement in the space
set forth below and returning the signed copy to us.
Very truly yours,
[LEAD UNDERWRITER]
[Acting on behalf of itself and the other
named Underwriters.]
By:
--------------------------------------
Authorized Signatory
Accepted:
XXX XXXXXXXX XXXXXXX
By:
--------------------------
Name:
Title:
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XXX XXXXXXXX XXXXXXX
(a Delaware corporation)
UNDERWRITING AGREEMENT STANDARD PROVISIONS
Dated: November 8, 2002
================================================================================
Xxx Xxxxxxxx Xxxxxxx, a Delaware corporation (the "Company"), proposes
to issue and sell an aggregate initial offering price of its debt securities
(the "Securities") from time to time not to exceed $1,300,000,000 (or its
equivalent in one or more foreign currencies), as such amount may be increased
from time to time pursuant to the filing of any Rule 462(b) Registration
Statement (as hereinafter defined). The Securities will be issued pursuant to an
indenture, dated as of April 11, 2002, as modified, amended or supplemented from
time to time (collectively, the "Indenture"), between the Company and Bank One,
N.A., as trustee (the "Trustee").
Whenever the Company determines to make an offering of Securities, the
Company will enter into an agreement (each, a "Terms Agreement") providing for
the sale of such Securities (the Securities to be offered and sold pursuant to
the applicable Terms Agreement, the "Offered Securities") to, and the purchase
and offering thereof by, one or more Underwriters. The standard provisions set
forth herein shall, except as otherwise provided in the applicable Terms
Agreement, be incorporated by reference in any Terms Agreement. The applicable
Terms Agreement, including the standard provisions set forth herein incorporated
therein by reference, is herein referred to as this "Agreement." Terms defined
in the applicable Terms Agreement are used herein as therein defined.
The Company has filed with the Securities and Exchange Commission (the
"Commission") in accordance with the provisions of the Securities Act of 1933,
as amended, and the rules and regulations of the Commission thereunder (the
"Securities Act"), a registration statement on Form S-3, including a prospectus,
relating to the Securities, and has filed with, or transmitted for filing to, or
shall promptly after the date of the applicable Terms Agreement file with, or
transmit for filing to, the Commission a prospectus supplement (the "Prospectus
Supplement") pursuant to Rule 424 under the Securities Act, specifically
relating to the Offered Securities to be offered and sold pursuant to the
applicable Terms Agreement. The term "Registration Statement" means the
registration statement referred to in the immediately preceding sentence,
including any exhibits thereto, as amended to the date of the applicable Terms
Agreement. The term "Basic Prospectus" means the prospectus included in the
Registration Statement. The term "Prospectus" means the Basic Prospectus
together with the applicable Prospectus Supplement, in the form most recently
furnished to the Underwriter or Underwriters, as the case may be, for use in
confirming sales of the Offered Securities. The term "preliminary prospectus"
means a preliminary prospectus supplement specifically relating to the Offered
Securities together with the Basic Prospectus. Any reference in this Agreement
to the Registration Statement, any preliminary prospectus or the Prospectus
shall be deemed to include, in each case, the documents, if any, incorporated by
reference therein pursuant to Item 12 of Form S-3 under the Securities Act as of
the effective date of the Registration Statement or the date of such preliminary
prospectus or the Prospectus, as the case may be, and any reference to "amend",
"amendment" or "supplement" with respect to the Registration Statement, any
preliminary prospectus or the Prospectus shall be deemed to include, in each
case, the documents, if any, that are filed with the Commission on or after such
date under the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission thereunder (the "Exchange Act"), that are deemed
to be incorporated by reference therein. If the Company has filed a registration
statement with the Commission pursuant to Rule 462(b) of the Securities Act (the
"Rule 462(b) Registration Statement"), then, after such filing, all references
to "Registration Statement" shall be deemed to refer to and include the Rule
462(b) Registration Statement.
SECTION 1. REPRESENTATIONS AND WARRANTIES BY THE COMPANY.
(a) Representations and Warranties. The Company represents and
warrants to the Underwriter or each Underwriter, as the case may be, named in
the applicable Terms Agreement, as of the date of the applicable Terms Agreement
and as of the Closing Time specified in such Terms Agreement, and agrees with
the Underwriter or each Underwriter, as the case may be, with respect to the
Offered Securities, as follows:
(i) REGISTRATION STATEMENT AND PROSPECTUS. The Company
meets the requirements for use of Form S-3 under the Securities Act.
The Registration Statement has been declared effective by the
Commission; and no stop order suspending the effectiveness of the
Registration Statement has been issued, and no proceeding for that
purpose has been initiated or, to the Company's knowledge, threatened
by the Commission. At the respective times the Registration Statement
and any post-effective amendments thereto became effective, the
Registration Statement and any amendments thereto complied in all
material respects with the requirements of the Securities Act and the
Trust Indenture Act of 1939, as amended, and the rules and regulations
of the Commission thereunder (the "Trust Indenture Act"), and did not
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading. At the date of the Prospectus and at
the Closing Time, neither the Prospectus nor any amendment or
supplement thereto includes an untrue statement of a material fact or
omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading. Notwithstanding the foregoing, the
representations and warranties in this subsection shall not apply to
(a) statements in or omissions from the Registration Statement or any
amendment thereto or the Prospectus or any amendment or supplement
thereto made in reliance upon and in conformity with information
furnished to the Company in writing by any Underwriter expressly for
use in the Registration Statement or any amendment thereto or the
Prospectus or any amendment or supplement thereto and (ii) that part of
the Registration Statement which constitutes the Trustee's Statement of
Eligibility on Form T-1 (the "Form T-1") under the Trust Indenture Act.
Each preliminary prospectus and prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the Securities Act,
complied when so filed in all material respects with the Securities
Act.
(ii) INCORPORATED DOCUMENTS. The documents incorporated by
reference in the Prospectus, when they were filed with the Commission,
conformed in all material respects to the requirements of the Exchange
Act, and none of such documents, when they were filed with the
Commission, included an 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.
(iii) FINANCIAL STATEMENTS. Except as noted therein: (A)
the consolidated financial statements, and the related notes thereto,
included in the Prospectus present fairly in all material respects the
consolidated financial position of the Company and its consolidated
subsidiaries as of the dates indicated and the results of their
operations and
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changes in their consolidated cash flows for the periods specified; (B)
said financial statements have been prepared in conformity with U.S.
generally accepted accounting principles applied on a consistent basis,
and the supporting schedules included in the Prospectus present fairly
in all material respects the information required to be stated therein;
(C) any pro forma financial information, and the related notes thereto,
included in the Prospectus have been prepared in accordance with the
applicable requirements of the Securities Act and the Exchange Act, as
applicable; and (D) the selected and consolidated financial data and
the summary financial information included in the Prospectus present
fairly the information shown therein and, unless otherwise indicated
therein, have been compiled on a basis consistent with that of the
audited financial statements included in the Prospectus.
(iv) NO MATERIAL ADVERSE CHANGE IN BUSINESS. Since the
respective dates as of which information is given in the Prospectus as
amended or supplemented, there has not been any material change in the
capital stock of the Company (other than shares of capital stock
repurchased pursuant to the Company's stock repurchase program as
authorized by the Company's board of directors from time to time) or
long-term debt of the Company and its consolidated subsidiaries taken
as a whole or any material adverse change, or any known development
involving the reasonable likelihood of a prospective material adverse
change, in the business, operations or financial condition of the
Company and its consolidated subsidiaries taken as a whole (a "Material
Adverse Effect"); and, since the respective dates as of which
information is given in the Prospectus as amended or supplemented,
neither the Company nor any subsidiary of the Company that is a
"significant subsidiary" within the meaning of Rule 1-02 of Regulation
S-X under the Securities Act (each, a "Significant Subsidiary") has
entered into any transaction or agreement (whether or not in the
ordinary course of business) material to the Company and its
consolidated subsidiaries taken as a whole.
(v) GOOD STANDING OF THE COMPANY. The Company has been
duly incorporated and is validly existing as a corporation in good
standing under the laws of its jurisdiction of incorporation, with
power and authority (corporate and other) to own its properties and
conduct its business as conducted as of the date of the applicable
Terms Agreement, 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, other than
where the failure to be so qualified or in good standing would not
result in a Material Adverse Effect.
(vi) GOOD STANDING OF SIGNIFICANT SUBSIDIARIES. Each of
the Significant Subsidiaries has been duly organized and is validly
existing under the laws of its jurisdiction of organization, with power
and authority (corporate and other) to own its properties and conduct
its business as conducted as of the date of the applicable Terms
Agreement; and, except as set forth in Exhibit 21 to the Company's most
recent Annual Report on Form 10-K or as described in the Prospectus,
all the outstanding shares of capital stock or other outstanding equity
interests in each Significant Subsidiary have been duly authorized and
validly issued, are fully-paid and non-assessable, and (except, in the
case of foreign subsidiaries, for directors' qualifying shares) are
owned by
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the Company, directly or indirectly, free and clear of all liens,
encumbrances, security interests and claims.
(vii) AUTHORIZATION OF THIS AGREEMENT. This Agreement has
been duly authorized, executed and delivered by the Company.
(viii) AUTHORIZATION OF THE INDENTURE. The Indenture has
been duly authorized by the Company and at the Closing Time will
constitute a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms, except as the
enforcement thereof may be subject to bankruptcy, insolvency,
reorganization, fraudulent conveyance or transfer, moratorium or
similar laws affecting creditors' rights generally and subject to
general principles of equity (regardless of whether enforceability is
considered in a proceeding in equity or at law).
(ix) AUTHORIZATION OF THE OFFERED SECURITIES. The Offered
Securities have been duly authorized by the Company for issuance and
sale pursuant to this Agreement. The Offered Securities, when
authenticated, issued and delivered in the manner provided for in the
Indenture and delivered against payment of the purchase price therefor
as provided in the applicable Terms Agreement, will constitute valid
and binding obligations of the Company, enforceable against the Company
in accordance with their terms, except as the enforcement thereof may
be subject to bankruptcy, insolvency, reorganization, fraudulent
conveyance or transfer, moratorium or similar laws affecting creditors'
rights generally and subject to general principles of equity
(regardless of whether enforceability is considered in a proceeding in
equity or at law), and will be in the form or forms contemplated by,
and will be entitled to the benefits of, the Indenture.
(x) ABSENCE OF DEFAULTS AND CONFLICTS. Neither the
Company nor any of its Significant Subsidiaries is, or with the giving
of notice or lapse of time or both would be, in violation of or in
default under, its charter or by-laws or any indenture, mortgage, deed
of trust, loan agreement or other agreement or instrument which is
material to the Company and its consolidated subsidiaries taken as a
whole and to which the Company or any of its Significant Subsidiaries
is a party or by which the Company or any of its Significant
Subsidiaries or any of their respective properties is bound or subject,
except for violations and defaults which individually and in the
aggregate would not result in a Material Adverse Effect. The execution,
delivery and performance by the Company of its obligations under this
Agreement, the Indenture and the Offered Securities and the
consummation of the transactions contemplated by this Agreement will
not conflict with, or result in a breach of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument which is
material to the Company and its consolidated subsidiaries taken as a
whole and to which the Company or any of its Significant Subsidiaries
is a party or by which the Company or any of its Significant
Subsidiaries or any of their respective properties is bound or subject,
except for conflicts, breaches and defaults which individually and in
the aggregate would not result in a Material Adverse Effect, nor will
any such action result in any violation of the provisions of the
Certificate of Incorporation or the By-Laws of the Company or any
applicable law or statute or any order, rule or regulation of any court
or
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governmental agency or body having jurisdiction over the Company,
its Significant Subsidiaries or any of their respective properties.
(xi) ABSENCE OF PROCEEDINGS. There are no legal or
governmental proceedings pending or, to the knowledge of the Company,
threatened to which the Company or any of its Significant Subsidiaries
is or is threatened to be a party or to which any properties of the
Company or any of its Significant Subsidiaries is or is threatened to
be the subject which could individually or in the aggregate reasonably
be expected to result in a Material Adverse Effect.
(xii) ABSENCE OF FURTHER REQUIREMENTS. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or
agency is necessary or required for the due authorization, execution,
delivery and performance by the Company of its obligations under this
Agreement, the Indenture and the Offered Securities, except such (i) as
have been already obtained or as may be required under the Exchange
Act, the Securities Act or the Trust Indenture Act and (ii) as may be
required under state securities or blue sky laws in connection with the
purchase and distributions of the Offered Securities by any
Underwriter.
(xiii) DESCRIPTION OF THE OFFERED SECURITIES AND THE
INDENTURE. The Offered Securities and the Indenture conform to the
descriptions thereof contained in the Prospectus as amended or
supplemented under the captions "Description of Debt Securities" and
"Description of the Notes," insofar as they purport to constitute a
summary of the terms of the Offered Securities. The descriptions
contained under the captions "Plan of Distribution" and "Underwriting,"
insofar as they purport to describe the provisions of the documents
referred to therein, accurately and fairly summarize such matters in
all material respects.
(xiv) INVESTMENT COMPANY ACT. The Company is not and, after
giving effect to the offering and sale of the Offered Securities, will
not be, an "investment company", as such term is defined in the
Investment Company Act of 1940, as amended (the "Investment Company
Act").
(xv) NO STABILIZATION OR MANIPULATION. None of the
Company, its Significant Subsidiaries, or any of their respective
officers, directors or controlling persons has taken, directly or
indirectly, any action designed to cause or to result in, or that has
constituted or might reasonably be expected to constitute, the
stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Offered Securities.
(b) Officer's Certificates. Any certificate signed by any officer
of the Company or any of its subsidiaries delivered to any Underwriter or to
counsel for the Underwriter or Underwriters, as the case may be, shall be deemed
a representation and warranty by the Company to the Underwriter or each
Underwriter, as the case may be, as to the matters covered thereby.
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SECTION 2. SALE AND DELIVERY; CLOSING.
(a) Offered Securities. The commitment of the Underwriter or the
several commitments of each Underwriter, as the case may be, named in the
applicable Terms Agreement to purchase the Offered Securities pursuant to this
Agreement shall be deemed to have been made on the basis of the representations,
warranties and agreements contained in this Agreement and shall be subject to
the terms and conditions contained in this Agreement.
(b) Payment. Payment shall be made to the Company by wire transfer
of immediately available funds to a bank account designated by the Company,
against delivery to, in each case, at the Closing Time and location specified in
the applicable Terms Agreement, the account of the Underwriter or, if more than
one Underwriter is named in the applicable Terms Agreement, delivery to the Lead
Underwriter for the respective accounts of the Underwriters, of the Offered
Securities to be purchased by it or them, as the case may be. It is understood
that, if more than one Underwriter is named in the applicable Terms Agreement,
each Underwriter named in the applicable Terms Agreement has authorized the Lead
Underwriter, for its account, to accept delivery of, receipt for, and make
payment of the purchase price for, the Offered Securities which it has severally
agreed to purchase and the Lead Underwriter, individually and not as
representative of such Underwriters, may (but shall not be obligated to) make
payment of the purchase price for the Offered Securities to be purchased by any
Underwriter whose funds have not been received by the Closing Time, but such
payment shall not relieve such Underwriter from its obligations hereunder.
(c) Denominations; Registration. If the Offered Securities are not
to be issued in a global form, certificates for the Offered Securities shall be
in such denominations and registered in such names as the Lead Underwriter may
request in writing at least one full business day before the Closing Time. The
certificates representing the Offered Securities shall be made available for
examination and packaging by the Lead Underwriter in The City of New York not
later than 10:00 a.m. (Eastern time) on the business day prior to the Closing
Time.
SECTION 3. COVENANTS OF THE COMPANY. The Company covenants with the
Underwriter or each Underwriter, as the case may be, named in the applicable
Terms Agreement, with respect to the Offered Securities, as follows:
(a) Filing of Prospectus; Filings under the Exchange Act. To
deliver to the Underwriter or each Underwriter, as the case may be, if
requested, a manually signed copy of the Registration Statement; to prepare the
Prospectus Supplement in a form reasonably acceptable to the Lead Underwriter
and to file the Prospectus pursuant to Rule 424 under the Securities Act not
later than the Commission's close of business on the second business day
following the execution and delivery of the applicable Terms Agreement or, if
applicable, such earlier time as may be required by Rule 424; to make no further
amendment or any supplement to the Registration Statement or Prospectus after
the date of the applicable Terms Agreement and prior to the Closing Time to
which the Lead Underwriter shall reasonably object promptly after reasonable
notice thereof (provided, that the foregoing shall not apply to any of the
Company's filings with the Commission under the Exchange Act); to advise the
Lead Underwriter promptly of any such amendment or supplement after such Closing
Time and for so long as the delivery of a prospectus is required in connection
with the offering or sale of the Offered Securities and
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furnish the Lead Underwriter with copies thereof (provided, that the foregoing
shall not apply to any of the Company's filings with the Commission under the
Exchange Act); 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 Exchange Act for so long as
the delivery of a prospectus is required in connection with the offering or sale
of the Offered Securities, and during such same period to advise the Lead
Underwriter, promptly after it receives notice thereof, of the time when any
amendment to the Registration Statement has been filed or becomes effective or
any supplement to the Prospectus or any amended Prospectus has been filed with
the Commission (provided, that the foregoing shall not apply to any of the
Company's filings with the Commission under the Exchange Act), 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 Offered Securities, of the suspension of
the qualification of the Offered 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 the Prospectus or suspending any such
qualification, to promptly use its best efforts to obtain the withdrawal of such
order.
(b) Qualification of the Offered Securities for Offer and Sale.
The Company will use its best efforts, in cooperation with the Underwriter or
each Underwriter, as the case may be, to qualify the Offered Securities for
offering and sale under the applicable securities laws of such states and other
jurisdictions as the Lead Underwriter may designate and will maintain such
qualifications in effect as long as required for the sale of the Offered
Securities; provided, however, that the Company shall not be obligated to file
any general consent to service of process or to qualify as a foreign corporation
or as a dealer in securities in any jurisdiction in which it is not so qualified
or to subject itself to taxation in respect of doing business in any
jurisdiction in which it is not otherwise so subject. In each jurisdiction in
which the Offered Securities have been so qualified, the Company will file such
statements and reports as may be required by the laws of such jurisdiction to
continue such qualification in effect for so long as may be required in
connection with the distribution of the Offered Securities.
(c) Delivery of Prospectus; Notice and Effect of Material Events.
Prior to 5:00 p.m., New York City time, on the New York business day next
succeeding the date of the applicable Terms Agreement, or as soon thereafter as
practicable but in no event later than the related Closing Time, to furnish to
the Underwriter or each Underwriter, as the case may be, with written and
electronic copies of the Prospectus in New York City in such quantities as the
Underwriter or each Underwriter may reasonably request, and, if the delivery of
a prospectus is required at any time in connection with the offering or sale of
the Offered Securities and if at such time any event shall have occurred that
could reasonably be expected to have a Material Adverse Effect, or any event as
a result of which the Prospectus as 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 such Prospectus in order to comply with the Securities Act, the
Exchange Act or the Trust Indenture Act, to notify the Lead Underwriter, and
confirm such notice in writing, and upon its request to file such document and
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to prepare and furnish without charge to the Underwriter or each Underwriter, as
the case may be, and to any dealer in securities as many written and electronic
copies as the Underwriter or each Underwriter 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) Financial Statements. To make generally available to its
securityholders as soon as practicable, but in any event not later than eighteen
months after the effective date of the Registration Statement (as defined in
Rule 158(c) under the Securities Act), an earnings statement of the Company and
its subsidiaries (which need not be audited) complying with Section 11(a) of the
Securities Act and the rules and regulations of the Commission thereunder
(including, at the option of the Company, Rule 158).
(e) DTC. The Company will cooperate with the Lead Underwriter and
use its best efforts to permit the Offered Securities to be eligible for
clearance and settlement through the facilities of DTC.
(f) Use of Proceeds. The Company will use the net proceeds
received by it from the sale of the Offered Securities in the manner specified
in the Prospectus under "Use of Proceeds."
(g) No Sales of Similar Securities. Subject to the immediately
following sentence, the Company agrees that during the period beginning on the
date of the applicable Terms Agreement and continuing to and including the
related Closing Time, not to offer, sell, contract to sell or otherwise dispose
of any debt securities of the Company that mature more than one year after the
Closing Time and which are substantially similar to the Offered Securities.
Notwithstanding the restriction contained in the immediately preceding sentence,
the Company may: (i) sell its commercial paper in the ordinary course of
business and (ii) issue and sell debt securities pursuant to the Distribution
Agreement, dated as of August 23, 2002, by and between the Company and Xxxxxxx
Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, as agent.
(h) Registration Statement; Incorporated Documents. At the
respective times that any further post-effective amendments to the Registration
Statement become effective, such amendments will comply in all material respects
with the requirements of the Securities Act and the Trust Indenture Act and will
not contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading. Any documents incorporated by reference in the Prospectus, when
such documents are filed with the Commission, will conform in all material
respects to the requirements of the Exchange Act, and will not contain an untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading.
SECTION 4. PAYMENT OF EXPENSES.
(a) Expenses. Unless otherwise provided in the applicable Terms
Agreement, the Company will pay the following expenses incident to the
performance of its obligations under this Agreement: (i) the preparation,
printing, filing and delivery to the Underwriter or each Underwriter, as the
case may be, named in the applicable Terms Agreement, of the Registration
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Statement or the Prospectus (including financial statements and any schedules or
exhibits and any document incorporated therein by reference) and of each
amendment or supplement thereto subsequent to the date of the applicable Terms
Agreement but prior to the expiration of the period of time during which the
delivery of a prospectus is required in connection with the offering or sale of
the Offered Securities, (ii) the preparation, printing and delivery to the
Underwriter or each Underwriter, as the case may be, of this Agreement, the
Indenture and such other documents as may be required in connection with the
offering, purchase, sale, issuance or delivery of the Offered Securities, (iii)
the fees and disbursements of the Company's counsel, accountants and other
advisors, (iv) the fees and expenses of the Trustee, including the fees and
disbursements of counsel for the Trustee in connection with the Indenture and
(v) any fees payable in connection with any rating of the Offered Securities.
Unless otherwise provided in the applicable Terms Agreement, the Underwriter or
each Underwriter, as the case may be, named in the applicable Terms Agreement
will pay the following expenses incident to the performance of its or their
obligations under this Agreement: (i) the preparation, issuance and delivery to
the Underwriter or each Underwriter, as the case may be, of the certificates for
the Offered Securities, including any transfer taxes, any stamp or other duties
payable upon the sale, issuance and delivery of the Offered Securities to the
Underwriter or each Underwriter and any charges of DTC in connection therewith,
(ii) the qualification of the Offered Securities under securities laws in
accordance with the provisions of Section 3(b) hereof, including filing fees and
the reasonable fees and disbursements of counsel for the Underwriter or
Underwriters, as the case may be, in connection therewith and in connection with
the preparation of any Blue Sky Survey or any supplement thereto, (iii) any fees
of the National Association of Securities Dealers, Inc. in connection with the
Offered Securities and (iv) the fees and disbursements of counsel to the
Underwriter or Underwriters, as the case may be.
(b) Termination of Agreement. If this Agreement is terminated by
the Lead Underwriter in accordance with the provisions of Section 5(h) or
Section 9(a)(i) hereof, the Company shall reimburse the Underwriter or each
Underwriter, as the case may be, named in the applicable Terms Agreement for all
of its or their out-of-pocket expenses reasonably incurred, including the
reasonable fees and disbursements of counsel for the Underwriter or
Underwriters.
SECTION 5. CONDITIONS TO THE OBLIGATIONS OF THE UNDERWRITER OR EACH
UNDERWRITER. The obligations of the Underwriter or each Underwriter, as the case
may be, named in the applicable Terms Agreement to purchase and pay for the
Offered Securities pursuant to this Agreement are subject to the accuracy, as of
the Closing Time, of the representations and warranties of the Company contained
in Section 1(a) hereof or in certificates of any officer of the Company or any
of its subsidiaries delivered pursuant to the provisions hereof, to the
performance by the Company of its covenants and other obligations hereunder
required to be performed by it on or before the Closing Time, and to the
following further conditions:
(a) Registration Statement and Prospectus. The Prospectus shall
have been filed with the Commission pursuant to Rule 424 under the Securities
Act within the applicable time period prescribed for such filing by the rules
and regulations under the Securities Act and in accordance with Section 3(a)
hereof; no stop order suspending the effectiveness of the Registration Statement
or any part thereof shall have been issued and no proceeding for that purpose
shall have been initiated or threatened by the Commission; and all requests for
additional information
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on the part of the Commission shall have been complied with to the Lead
Underwriter's reasonable satisfaction.
(b) Opinion of Counsel for the Company. At the Closing Time, the
Lead Underwriter shall have received the favorable opinion, dated as of the
Closing Time, of the General Counsel or a Deputy General Counsel of the Company,
in form and substance reasonably satisfactory to the Lead Underwriter.
(c) Opinion of Counsel for the Underwriter or Underwriters. At the
Closing Time, the Lead Underwriter shall have received the opinion, dated as of
the Closing Time, of counsel for the Underwriter or Underwriters, as the case
may be, in form and substance reasonably satisfactory to the Lead Underwriter.
In giving such opinion such counsel may state that, insofar as such opinion
involves factual matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company and certificates of public officials.
(d) Officers' Certificate. At the Closing Time, there shall not
have been, since the date of the applicable Terms Agreement or since the
respective dates as of which information is given in the Prospectus as amended
or supplemented, any Material Adverse Effect and the Lead Underwriter shall have
received a certificate of the Company, signed by each of the Treasurer and
Secretary of the Company, dated as of the Closing Time, to the effect that (i)
there has been no such Material Adverse Effect, (ii) the representations and
warranties in Section 1(a) hereof are true and correct with the same force and
effect as though expressly made at and as of the Closing Time, and (iii) the
Company has complied with all of the agreements entered into in connection with
the transaction contemplated by this Agreement and satisfied all conditions on
its part to be performed or satisfied at or prior to the Closing Time.
(e) Accountants' Comfort Letters. On or prior to the date of
delivery of the Prospectus to the Underwriter or Underwriters, as the case may
be, pursuant to the first clause of Section 3(c) hereof and at the Closing Time,
the Lead Underwriter shall have received from KPMG LLP or the Company's then
engaged accounting firm a letter dated such date, in form and substance
reasonably satisfactory to the Lead Underwriter, containing statements and
information of the type ordinarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and financial information
included in the Registration Statement and the Prospectus.
(f) Additional Documents. At the Closing Time, counsel for the
Underwriter or Underwriters, as the case may be, shall have been furnished with
such documents and opinions as they may reasonably require for the purpose of
enabling them to pass upon the issuance and sale of the Offered Securities, or
in order to evidence the accuracy of any of the representations or warranties,
or the fulfillment of any of the conditions contained in this Agreement; and all
proceedings taken by the Company in connection with the issuance and sale of the
Offered Securities shall be reasonably satisfactory in form and substance to the
Lead Underwriter and such counsel.
(g) Maintenance of Rating. Since the date of the applicable Terms
Agreement, there shall not have occurred a downgrading in the rating assigned to
any of the Company's debt securities by any "nationally recognized statistical
rating agency", as that term is defined by the
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Commission for purposes of Rule 436(g)(2) under the Securities Act, and no such
securities rating agency shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating of any
of the Company's debt securities.
(h) Termination of this Agreement. If any condition specified in
this Section 5 shall not have been fulfilled when and as required to be
fulfilled, this Agreement may be terminated by the Lead Underwriter by notice to
the Company at any time prior to the Closing Time, and such termination shall be
without liability of any party to any other party except as provided in Section
4 and except that Sections 6 and 7 shall survive any such termination and remain
in full force and effect.
SECTION 6. INDEMNIFICATION.
(a) Indemnification of the Underwriter or Each Underwriter. The
Company agrees to indemnify and hold harmless the Underwriter or each
Underwriter, as the case may be, named in the applicable Terms Agreement, and
each person, if any, who controls the Underwriter or each such Underwriter
within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act as follows:
(i) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, arising out of any untrue
statement or alleged untrue statement of a material fact contained in
the Registration Statement (or any amendment thereto), or the omission
or alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading, or
arising out of any untrue statement or alleged untrue statement of a
material fact included in any preliminary prospectus or the Prospectus
(or any amendment or supplement thereto), or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, to the extent of the aggregate
amount paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or of any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission; provided,
that (subject to Section 6(d) below) any such settlement is effected
with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the reasonable fees and disbursements of counsel chosen by
the Lead Underwriter), reasonably incurred in investigating, preparing
or defending against any litigation, or any investigation or proceeding
by any governmental agency or body, commenced or threatened, or any
claim whatsoever based upon any such untrue statement or omission, or
any such alleged untrue statement or omission, to the extent that any
such expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to (A) any
loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue
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statement or omission made in reliance upon and in conformity with written
information furnished to the Company by any Underwriter expressly for use in the
Registration Statement (or any amendment thereto) or any preliminary prospectus
or the Prospectus (or any amendment or supplement thereto) or (B) any loss,
liability, claim, damage or expense that results from the fact that any
Underwriter sold Offered Securities to a person to whom there was not sent or
given, at or prior to the earlier of either the mailing or delivery of the
written confirmation of such sale or the delivery of such Offered Securities to
such person, a copy of the Prospectus (excluding the documents incorporated
therein by reference), if the Company had previously furnished copies thereof to
such Underwriter in a sufficient amount of time in advance of such mailing or
delivery to allow such Underwriter to mail or deliver such copies to such person
and, as of the date of such mailing or delivery, such Prospectus did not include
an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(b) Indemnification of the Company, Directors and Officers. The
Underwriter agrees or, if more than one Underwriter is named in the applicable
Terms Agreement, each Underwriter, severally agrees, to indemnify and hold
harmless the Company, its directors, each of its officers who signed the
Registration Statement and each person, if any, who controls the Company within
the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act against any and all loss, liability, claim, damage and expense described in
the indemnity contained in subsection (a) of this Section, as incurred, but only
with respect to untrue statements or omissions, or alleged untrue statements or
omissions, made in the Registration Statement (or any amendment thereto) or any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written information furnished
to the Company by such Underwriter expressly for use in the Registration
Statement (or any amendment thereto) or such preliminary prospectus or the
Prospectus (or any amendment or supplement thereto).
(c) Actions against Parties; Notification. Each indemnified party
shall give notice as promptly as reasonably practicable to each indemnifying
party of any action commenced against it in respect of which indemnity may be
sought hereunder, but failure to so notify an indemnifying party shall not
relieve such indemnifying party from any liability hereunder to the extent it is
not materially prejudiced as a result thereof and in any event shall not relieve
it from any liability which it may have otherwise than on account of this
indemnity agreement. In the case of parties indemnified pursuant to Section 6(a)
above, counsel to the indemnified parties shall be selected by the Lead
Underwriter, and, in the case of parties indemnified pursuant to Section 6(b)
above, counsel to the indemnified parties shall be selected by the Company. In
case any such action shall be brought against any indemnified party and it shall
notify the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it shall
wish, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel reasonably satisfactory to such indemnified
party (who shall not, except with the consent of the indemnified party, be
counsel to the indemnifying party), and, after notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof, the indemnifying party shall not be liable to such indemnified party
for any legal expenses of other counsel or any other expenses, in each case
subsequently incurred by such indemnified party, in connection with the defense
thereof, other than reasonable costs of investigation. No indemnifying party
shall, without the prior written
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consent of the indemnified parties, settle or compromise or consent to the entry
of any judgment with respect to any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened, or any
claim whatsoever in respect of which indemnification or contribution could be
sought under this Section or Section 7 hereof (whether or not the indemnified
parties are actual or potential parties thereto), unless such settlement,
compromise or consent (i) includes an unconditional release of each indemnified
party from all liability arising out of such litigation, investigation,
proceeding or claim and (ii) does not include a statement as to or an admission
of fault, culpability or a failure to act by or on behalf of any indemnified
party.
(d) Settlement without Consent if Failure to Reimburse. If at any
time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 6(a)(ii) effected without its written consent if
(i) such settlement is entered into more than 45 days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party shall
have received notice of the terms of such settlement at least 30 days prior to
such settlement being entered into and (iii) such indemnifying party shall not
have reimbursed such indemnified party in accordance with such request prior to
the date of such settlement.
SECTION 7. CONTRIBUTION. If the indemnification provided for in Section
6 hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company, on the one
hand, and the Underwriter or Underwriters, as the case may be, named in the
applicable Terms Agreement, on the other hand, from the offering of the Offered
Securities or (ii) if the allocation provided by clause (i) is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company, on the one hand, and of the Underwriter or Underwriters, as the
case may be, on the other hand, in connection with the statements or omissions
which resulted in such losses, liabilities, claims, damages or expenses, as well
as any other relevant equitable considerations.
The relative benefits received by the Company, on the one hand, and the
Underwriter or Underwriters, as the case may be, on the other hand, in
connection with the offering of the Offered Securities shall be deemed to be in
the same respective proportions as the total net proceeds from the offering of
the Offered Securities (before deducting expenses) received by the Company and
the total underwriting discount received by the Underwriter or Underwriters bear
to the aggregate initial offering price of the Offered Securities.
The relative fault of the Company, on the one hand, and the Underwriter
or Underwriters, as the case may be, on the other hand, shall be determined by
reference to, among other things, whether any such untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material
fact relates to information supplied by the Company or by the Underwriter or
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
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The Company and the Underwriter or Underwriters, as the case may be,
agree that it would not be just and equitable if contribution pursuant to this
Section 7 were determined by pro rata allocation or by any other method of
allocation which does not take account of the equitable considerations referred
to above in this Section 7. The aggregate amount of losses, liabilities, claims,
damages and expenses incurred by an indemnified party and referred to above in
this Section 7 shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based upon any
such untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the Offered Securities purchased and sold by it hereunder exceeds
the amount of any damages that such Underwriter has otherwise been required to
pay by reason of such untrue or alleged untrue statement or omission or alleged
omission.
If more than one Underwriter is named in the applicable Terms
Agreement, the Underwriters' respective obligations to contribute pursuant to
this Section 7 are several in proportion to the aggregate principal amount of
Offered Securities set forth opposite their respective names in such Terms
Agreement, and not joint.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act shall have the same rights to contribution as such
Underwriter, and each of the Company's directors and officers who have signed
the Registration Statement and each person, if any, who controls the Company
within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act shall have the same rights to contribution as the Company.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or any of its
subsidiaries submitted pursuant hereto shall remain operative and in full force
and effect, regardless of any investigation made by or on behalf of any
Underwriter or controlling person, or by or on behalf of the Company, and shall
survive delivery of and payment for the Offered Securities.
SECTION 9. TERMINATION OF AGREEMENT.
(a) Termination; General. The Lead Underwriter may terminate this
Agreement, by notice to the Company, at any time at or prior to the Closing Time
(i) if there has been, since the time of execution of the applicable Terms
Agreement or since the respective dates as of which information is given in the
Registration Statement or the Prospectus, any Material Adverse Effect, or (ii)
if there has occurred any material adverse change in the financial markets in
the
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United States or in the international financial markets, any outbreak of
hostilities or escalation thereof or other calamity or crisis (including without
limitation an act of terrorism) or any change or development involving a
prospective change in national or international political, financial or economic
conditions, in each case the effect of which is such as to make it, in the
judgment of the Lead Underwriter, impracticable or inadvisable to market the
Offered Securities or to enforce contracts for the sale of the Offered
Securities, or (iii) if trading in any securities of the Company has been
suspended or materially limited by the Commission or the New York Stock
Exchange, or if trading generally on the American Stock Exchange or the New York
Stock Exchange or in the Nasdaq National Market has been suspended or materially
limited, or minimum or maximum prices for trading have been fixed, or maximum
ranges for prices have been required, by any of said exchanges or by such system
or by order of the Commission, the National Association of Securities Dealers,
Inc. or any other governmental authority, or a material disruption has occurred
in commercial banking or securities settlement or clearance services in the
United States, or (iv) if a banking moratorium has been declared by either
Federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section 9, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further, that
Sections 6 and 7 shall survive such termination and remain in full force and
effect.
SECTION 10. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS. If more than
one Underwriter is named in the applicable Terms Agreement and one or more of
the Underwriters shall fail at the Closing Time to purchase the Offered
Securities which it or they are obligated to purchase under such Terms Agreement
(the "Defaulted Securities"), then the Lead Underwriter shall have the right,
within 24 hours thereafter, to make arrangements for one or more of the
non-defaulting Underwriters, or any other underwriters, to purchase all, but not
less than all, of the Defaulted Securities in such amounts as may be agreed upon
and upon the terms set forth in this Agreement; if, however, the Lead
Underwriter shall not have completed such arrangements within such 24-hour
period, then:
(a) if the aggregate principal amount of Defaulted Securities does
not exceed 10% of the aggregate principal amount of Offered Securities to be
purchased on such date pursuant to such Terms Agreement, the non-defaulting
Underwriters shall be obligated, severally and not jointly, to purchase the full
amount of the Defaulted Securities in the proportions that their respective
underwriting obligations under such Terms Agreement bear to the underwriting
obligations of all non-defaulting Underwriters, or
(b) if the aggregate principal amount of Defaulted Securities
exceeds 10% of the aggregate principal amount of Offered Securities to be
purchased on such date pursuant to such Terms Agreement, this Agreement shall
terminate without liability on the part of any non-defaulting Underwriter or the
Company.
No action taken pursuant to this Section 10 shall relieve any
defaulting Underwriter from liability in respect of its default.
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In the event of any such default which does not result in a termination
of this Agreement, either the Lead Underwriter or the Company shall have the
right to postpone the Closing Time for a period not exceeding seven days in
order to effect any required changes in the Registration Statement or the
Prospectus or in any other documents or arrangements.
SECTION 11. NOTICES. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the Company
shall be directed to it at Xxx Xxxxxxxx Xxxxxxx, Prudential Xxxxx Xxxxxxxx,
Xxxxxx, Xxxxxxxxxxxxx 00000, attention: Treasurer, Telecopy No.: (000) 000-0000.
Notices to the Underwriter or Underwriters, as the case may be, shall be
directed as provided in the applicable Terms Agreement.
SECTION 12. PARTIES. This Agreement shall each inure to the benefit of
and be binding upon the Company, the Underwriter or each Underwriter, as the
case may be, named in the applicable Terms Agreement, and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
Underwriter or Underwriters, as the case may be, and the Company and their
respective successors and the controlling persons and officers and directors
referred to in Sections 6 and 7 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision contained in this Agreement. This Agreement and all conditions
and provisions contained in this Agreement are intended to be for the sole and
exclusive benefit of the parties to the applicable Terms Agreement and their
respective successors, and said controlling persons and officers and directors
and their heirs and legal representatives, and for the benefit of no other
person, firm or corporation. No purchaser of Offered Securities from any
Underwriter shall be deemed to be a successor by reason merely of such purchase.
SECTION 13. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED TIMES
OF DAY REFER TO NEW YORK CITY TIME.
SECTION 14. EFFECT OF HEADINGS. The Article and Section headings herein
are for convenience only and shall not affect the construction hereof.
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