EXHIBIT 99.1
SUBSCRIPTION AGENT AGREEMENT
THIS AGREEMENT is entered into as of _____________, 2001 by and between
Tipperary Corporation, a Texas corporation (the "Company"), and Computershare
Trust Company, Inc., d.b.a. Computershare Investor Services (the "Subscription
Agent").
WHEREAS, the Company intends to distribute (the "Rights Offering") to each
stockholder that owns shares of the Company's common stock, par value $.02 per
share (the "Common Shares") at the close of business on ___________, 2001,
rights to purchase one Common Share for each Right held, plus additional Common
Shares pursuant to the "Over-Subscription Privilege" as defined below; and
WHEREAS, the Company desires the Subscription Agent to act on the Company's
behalf, and the Subscription Agent is willing so to act, in connection with the
issuance and distribution of the Rights, collection of funds from rights holders
exercising Rights, and issuance and delivery of Common Shares upon the exercise
of the Rights.
NOW, THEREFORE, in consideration of the promises and mutual covenants set
forth herein, the parties agree as follows:
1. Definitions. As used in this Agreement, the following terms have the
following meanings:
(a) "Basic Subscription Privilege" means the right of Eligible Rights
Holders to subscribe for and purchase Common Shares through the exercise of
Rights at the rate of one Common Share for each Right held.
(b) "Eligible Rights Holders" means all Company stockholders that own
Common Shares at the close of business on __________.
(c) "Expiration Time" means 5:00 p.m., Mountain Daylight Savings Time
on __________ or on such other date as the Company may determine.
(d) "Offering Period" means the period commencing on ________ and
ending at the Expiration Time.
(e) "Over-Subscription Privilege" means the right to subscribe for and
purchase additional Common Shares not purchased by other stockholders, provided
that an Eligible Rights Holder may exercise the Over-Subscription Privilege only
if the Eligible Rights Holder exercises the Basic Subscription Privilege in
full.
(f) "Prospectus" means the Company's prospectus dated __________
pertaining to the Rights Offering including the documents incorporated by
reference therein, as the same may from time to time be supplemented or amended.
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(g) "Rights" means the subscription rights distributed by the
Company in an amount equal to one right for each ____ Common Shares owned, each
of which entitles Eligible Rights Holders to subscribe for and purchase one
Common Share for each right held, at a Subscription Price of $______ per share.
(h) "Subscription Certificate" means the certificate evidencing the
Rights.
(i) "Subscription Price" means $___________ per share.
2. Form of Subscription Certificates. The Subscription Certificates shall
be substantially in the form attached as Exhibit A hereto. Each Subscription
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Certificate shall be signed by duly authorized officers of the Company dated the
date of issue (whether upon original issuance or in lieu of transferred,
exchanged, mutilated, destroyed, lost or stolen Subscription Certificates) and
countersigned by the Subscription Agent. All signatures may be facsimile
signatures.
3. Issuance of Subscription Certificates. The Subscription Agent shall
issue and deliver (by first class United States mail, postage prepaid) to each
Eligible Rights Holder a Subscription Certificate evidencing such holder's
Rights. Each Eligible Rights Holder shall receive one Right for each ___ Common
Shares held. The Subscription Agent shall not issue fractional Rights.
Instead, the number of Rights issued shall be rounded up to the nearest whole
number. No Subscription Certificates shall be issued before or after the
Offering Period. All Subscription Certificates surrendered to the Subscription
Agent upon exercise shall be canceled by the Subscription Agent and thereafter
shall be retained by the Subscription Agent for a period of not less than six
years or such shorter period of time as the Company may permit. Upon expiration
of the retention period, the canceled Subscription Certificates shall be
delivered to the Company or destroyed by the Subscription Agent, as directed by
the Company.
4. Delivery of Prospectus and Other Documents. The Subscription Agent
shall deliver to each Eligible Rights Holder, along with originally issued
Subscription Certificates (i) a letter from the Chief Executive Officer of the
Company to all Eligible Rights Holders, (ii) a Prospectus, (iii) Instructions as
to Use of the Subscription Certificates, (iv) a return envelope addressed to the
Subscription Agent, and (v) such other documents and information as the Company
may provide. The Subscription Agent shall also provide copies of the Prospectus
and other documents prepared by the Company to Eligible Rights Holders, and
other persons upon request.
(a) The Company will provide the Subscription Agent with a sufficient
number of Prospectuses as the Subscription Agent may require.
(b) The Subscription Agent shall provide a sufficient number of
Subscription Certificates as required to distribute to Eligible Rights Holders
and to replace lost, destroyed, mutilated or stolen Subscription Certificates.
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5. Exercise. Rights may be exercised at any time during the Offering
Period upon the terms and conditions set forth in the Prospectus and in this
Agreement.
(a) An Eligible Rights Holder may exercise Basic Subscription Privileges
and, if desired, Over-Subscription Privileges by completing and executing the
exercise portion of the Subscription Certificate and delivering it to the
Subscription Agent along with payment of the Subscription Price for the
aggregate number of Common Shares subscribed for prior to the Expiration Time.
An eligible Rights Holder must exercise such holder's Basic Subscription
Privilege in full in order to be eligible to exercise its Over-Subscription
Privilege. If an Eligible Rights Holder exercises its Basic Subscription
Privilege in full, the holder may exercise its Over-Subscription Privilege for
as many Common Shares as such Eligible rights Holder indicates on its
Subscription Certificate and for which the holder pays the Subscription Price,
subject to the availability of such shares and allocation set forth in Section
5(b).
(b) The Company will issue a maximum of _______ Common Shares in the rights
Offering. The number of Common Shares available for Over-Subscription
Privileges will be _______ minus the number of Common Shares purchased upon
exercise of the Basic Subscription Privileges. Provided that a sufficient
number of Common Shares are available, the Subscription Agent shall honor
exercises of the Over-Subscription Privileges in full. If exercises of the
Over-Subscription Privileges exceed the number of Common Shares available, the
Subscription Agent shall allocate the available shares among the Eligible Rights
Holders that over-subscribed in proportion to the number of Common Shares
purchased by those over-subscribing Eligible Rights Holders through the Basic
Subscription Privileges. However, if an Eligible Rights Holder's pro rata
allocation exceeds the number of Common Shares the Eligible Rights Holder
requested, the Eligible Rights Holder will receive only the number of Common
Shares the eligible Rights Holder requested, and the remaining shares from the
Eligible Rights Holder's pro rata allocation will be divided among other
Eligible Rights Holders exercising their Over-Subscription Privileges that have
subscribed for additional Common Shares in proportion to the number of shares
purchased by that group of over-subscribing Eligible Rights Holders through the
Basic Subscription Rights.
(c) The Subscription Agent shall accept any subscription if, prior to the
Expiration Time, the Subscription Agent has received (i) payment of the full
Subscription Price for the Common Shares subscribed for, or (ii) a Notice of
Guaranteed Delivery by facsimile (telecopy) or otherwise from a member firm of a
registered national securities exchange or a member of the National Association
of Securities Dealers, Inc., or a commercial bank or trust company having an
office or correspondent in the United States, guaranteeing delivery of a
properly completed and executed Subscription Certificate; provided, however,
that the Subscription Agent shall not honor a Notice of Guaranteed Delivery
unless a properly completed and executed Subscription Certificate is received by
the Subscription Agent by the close of business on the third trading day on the
American Stock Exchange after the Expiration Time.
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(d) The Subscription Price shall be paid in United States dollars, by (i)
check or draft drawn on a United States bank, or a postal, telegraphic or
express money order payable to the Subscription Agent, or (ii) by wire transfer
of same day funds to an account maintained by Subscription Agent for the purpose
of accepting subscriptions, in accordance with the following wire instructions:
Union Bank & Trust
000 Xxxxxxxx
Xxxxxx, Xxxxxxxx 00000
(000) 000-0000
ABA #000000000
Credit Account #85-02961
Account Name: Computershare Trust Company, Inc.
Escrow Agent
(e) Payment will be deemed to have been received by the Subscription
Agent only upon:
(i) clearance of any uncertified check; or
(ii) receipt by the Subscription Agent of any certified check or
bank draft drawn upon a U.S. bank or of any postal, telegraphic or express money
order; or
(iii) receipt by the Subscription Agent of any funds transferred by
wire transfer; or
(iv) receipt of funds by the Subscription Agent through an
alternative payment method approved by the Company.
(f) Once an Eligible Rights Holder has exercised Rights, such exercise
may not be revoked or rescinded.
(g) If an Eligible Rights Holder exercises fewer than all of the rights
evidenced by the Eligible Rights Holder's Subscription certificate and requests
in writing that the Subscription Agent issue a Subscription Certificate
evidencing the unexercised Rights, the Subscription Agent shall immediately
issue to such holder a new Subscription Certificate evidencing the unexercised
Rights and deliver it to the eligible Rights Holder at the address shown on such
Subscription Certificate.
(h) If an Eligible Rights Holder does not specify the number of Rights
being exercised on the Subscription Certificate, or if payment is not sufficient
to pay the total purchase price for all of the Common Shares that the Eligible
Rights Holder indicated that the holder wished to purchase, such holder will be
deemed to have exercised the maximum number of Rights that could be exercised
for the amount of the payment received by the Subscription Agent. If payment
exceeds the total purchase price
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for all of the rights shown on the Subscription Certificate, payment will be
applied, until depleted, to subscribe for Common Shares in the following order:
(i) to subscribe for the number of Common Shares, if any, that the
eligible Rights Holder indicated on the Subscription Certificate that such
holder wished to purchase through the Basic Subscription Privilege;
(ii) to subscribe for Common Shares until the Basic Subscription Privilege
has been fully exercised;
(iii) to subscribe for additional Common Shares pursuant to the Over-
Subscription Privilege, but subject to any applicable proration.
Any excess payment remaining after the foregoing allocation will be
returned to the eligible Rights Holder as soon as practicable by mail, without
interest or deduction.
6. Power of Attorney. The Company hereby constitutes and appoints the
Subscription Agent as the Company's true and lawful attorney-in-fact, with full
power in such capacity to endorse, deposit, negotiate, and invest on behalf and
for the account of the Company, in accordance with the written instructions
provided by the Company, checks, drafts, money orders, wire transfers or other
payments received by the Subscription Agent as a payment of the Subscription
Price upon the exercise of the Basic Subscription Privilege and, if desired, the
Over-Subscription Privilege.
7. Escrow and Investment of Funds. The Subscription Agent shall:
(a) Maintain a record of the date, amount of each payment of the
Subscription Price received upon the exercise of Rights, and the name and
address of the Eligible Rights Holder by whom or on whose behalf payment was
made.
(b) Aggregate all payments received upon the exercise of Rights and
deposit such payments in one or more bank accounts, as soon as practicable after
receipt of such payments.
(c) Keep all funds deposited in accounts in the name of the
Company for the benefit of the Company.
(d) Return as promptly as practicable to the Eligible Rights
Holder who made such payment, any payment of the Subscription Price for Common
Shares not accepted by the Company for any reason.
8. Payment of Funds to the Company. Funds representing payment of the
Subscription Price for Common Shares (including interest earned thereon) shall
be paid to the Company by wire transfer to such account and according to such
instructions as the company may deliver to the Subscription Agent in writing.
Unless changed by subsequent written instructions, the Subscription Agent shall
follow the wiring
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instructions attached to this Agreement as Exhibit B. Such wire transfer of
funds to the Company shall be made promptly following the Expiration Time, at
which time all funds received by the Subscription Agent from Rights holders
shall be paid (together with interest thereon) to the Company.
9. Reports. The Subscription Agent shall deliver daily to the Company a
written report showing (a) the number of Rights exercised on such day, and the
aggregate number of Rights exercised through such date; and (b) the amount of
funds received on such day in payment of the Subscription Price for Common
Shares, and the aggregate amount of funds on deposit or invested for the account
of the Company from payment of the Subscription Price for Common Shares through
such date.
10. Issuance of Common Shares. As soon as practicable after the
Expiration Time, the Subscription Agent, as Transfer Agent and Registrar for the
Common Shares, shall issue and deliver to each Eligible Rights Holder exercising
Rights a stock certificate evidencing the aggregate of the number of Common
Shares purchased by exercise of the Basic Subscription Privilege and, if
applicable, the Over-Subscription Privilege.
11. Validity and Form of Subscriptions. All questions concerning the
timeliness, validity, form, and eligibility of any exercise of Rights shall be
determined by the Company, whose determination shall be final and binding. The
Subscription Agent shall examine the Subscription Certificates it receives to
ascertain whether they appear to have been completed and executed in accordance
with the Prospectus and the instructions for exercise. In the event that the
Subscription Agent determines that the Subscription Certificate does not appear
to have been properly competed or executed, or where the Subscription
Certificates do not appear to be in proper form for subscription, or any other
irregularity in connection with the subscription appears to exist, the
Subscription Agent shall follow its regular procedures to attempt to cause such
irregularity to be corrected. The Subscription Agent shall promptly notify the
Company in writing of all defects in the exercise of any Rights that the
Subscription Agent is unable to cure through its regular procedures. The
Subscription Agent is not authorized to waive any irregularity in connection
with any subscription, unless it has received from the Company notification,
duly dated and signed by an authorized officer of the Company, indicating that
any irregularity in such subscription has been cured or waived and that such
subscription has been accepted by the Company. Subscription Certificates and
funds received by the Subscription Agent that are not properly executed or
submitted, and as to which all irregularities have not been timely waived or
cured, shall be returned by the Subscription Agent to the eligible Rights Holder
who submitted such Subscription Certificate and/or payment. Such return shall
be made by either first class mail under a blanket surety bond or insurance
protecting the Subscription Agent and the Company from losses or liabilities
arising out of the non-receipt or nondelivery of such Subscription Certificates
and funds or by registered mail insured separately for the value of such
Subscription Certificates and funds, and if determined to be required by the
Company, shall include a letter of notice to be furnished by the Company
explaining the reasons for the return of the Subscription Certificates, funds,
and other documents.
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12. Amendment, Extension or Termination of the Rights Offering. The
Company reserves the right, in its sole discretion, to (a) terminate the Rights
Offering prior to delivery of the Common Shares for which Eligible Rights
Holders have subscribed pursuant to the exercise of Rights; (b) extend the
Expiration Time to a later date and time; or (c) amend or modify the terms of
the Rights. If the Company materially amends the terms of the Rights, an
amended Prospectus will be distributed to holders of record of Rights and to
holders of Rights who have previously exercised Rights. All holders of Rights
who exercised Rights prior to such amendment or within four business days after
the mailing of the amended Prospectus will be given the opportunity to confirm
the exercise of Rights by executing and delivering a consent form.
13. Loss or Mutilation. Upon receipt by the Company and the
Subscription Agent of evidence, satisfactory to them, of the ownership and loss,
theft, destruction or mutilation of any Subscription Certificate, and in the
case of loss, theft or destruction, receipt of indemnity satisfactory to the
Company and the Subscription Agent, and in the case of mutilation upon surrender
and cancellation of the mutilated Subscription Certificate, the Subscription
Agent shall deliver in place of such lost, stolen, destroyed or mutilated
Subscription Certificate a new Subscription Certificate representing an equal
aggregate number of Rights. Eligible Rights Holders requesting such substitute
Subscription Certificates shall also comply with such other reasonable
regulations, requirements or requests, as the Company or the Subscription Agent
may prescribe.
14. Liability of Subscription Agent. The Subscription Agent shall not,
by issuing and delivering Subscription Certificates or stock certificates
evidencing Common Shares, or receiving or holding funds for the benefit of the
Company, or by any other act under this Agreement, be deemed to make any
representations as to the validity or value or authorization of the Subscription
Certificates or the rights represented thereby or the Common Shares issued upon
the exercise of Rights, or whether the Common Shares issued upon the exercise of
Rights are fully paid and nonassessable. The Subscription Agent shall not be (a)
liable for any statement of fact, other than any statement of fact made by or on
behalf of Subscription Agent, made or contained in this Agreement or in the
Prospectus or in any documents prepared by the Company in connection with the
offer of Common Shares through the Rights, (b) liable for any action taken,
suffered, or omitted by it in reliance upon any Subscription Certificate or
other document or instrument believed by it in good faith to be genuine and to
have been signed or presented by the proper party or parties, (c) responsible
for any failure on the part of the Company to comply with any of its covenants
and obligations contained in this Agreement or in the Subscription Certificates,
or (d) liable for any act or omission in connection with the performance of its
duties, obligations, covenants and agreements under this Agreement, except for
the Subscription Agent's own negligence, willful breach or misconduct.
15. Indemnification. The Company agrees to indemnify and hold harmless
the Subscription Agent from and against any and all losses, expenses, and
liabilities, including judgments, costs, and reasonable attorneys' fees, arising
out of any act or omission of the Subscription Agent in the execution or
performance of its duties,
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obligations, covenants, and agreements under this Agreement, except for the
Subscription Agent's own negligence, willful breach or misconduct.
16. Compensation for Services. The Company agrees to pay the
Subscription Agent pursuant to the terms in the proposal provided to the Company
by the Subscription Agent as set forth on Exhibit C attached hereto.
17. Amendment; Modification; Waiver. This Agreement may be amended,
waived, discharged, or terminated in whole or in part only by a written
instrument signed by the party against whom enforcement of such amendment,
waiver, discharge, or termination is sought. Notwithstanding the immediately
preceding sentence, the parties shall supplement or amend this Agreement to
conform to any amendments or changes that the Company may make to the terms and
conditions of the Rights and the offer of the Common Shares through the Rights.
18. Notices. All notices, requests, demands and other communications
required or permitted under this Agreement shall be in writing and shall be
deemed to have been duly given, made and received (i) when delivered against
receipt; (ii) upon delivery by an overnight courier service or facsimile with
confirmation of receipt; or (iii) upon actual receipt of registered or certified
mail, postage prepaid, return receipt requested, addressed as set forth below:
(a) If to the Company:
Tipperary Corporation
000 Xxxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
(000) 000-0000 (tel)
(000) 000-0000 (fax)
Attention: Chief Executive Officer
With a copy to:
Xxxxx & Xxxxxx, P.C.
0000 Xxxxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attn: Xxxx X. Xxxxxxx, Esq.
(000) 000-0000 (tel)
(000) 000-0000 (fax)
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(b) If to the Subscription Agent:
Computershare Trust Company, Inc.
X.X. Xxx 0000
Xxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxx Xxxxxxx
(000) 000-0000 (tel)
(000) 000-0000 (fax)
Any party may alter the address to which communications or copies are to be
sent by giving notice of such change of address in conformity with the
provisions of this paragraph for the giving of notice.
19. Delays or Omissions. No delay or omission to exercise any right,
power, or remedy accruing to any party to this Agreement, upon any breach or
default of any other party under this Agreement, shall impair any such right,
power, or remedy; nor shall it be construed to be a waiver of, or an
acquiescence in any such breach or default or any similar breach or default
thereafter occurring; nor shall any waiver of any single breach or default be
deemed a waiver of any other breach or default theretofore or thereafter
occurring. Any waiver, permit, consent or approval of any kind or character, on
the part of any party, of any breach or default under this Agreement, or any
waiver, on the part of any party, of any provisions or conditions of this
Agreement, must be made in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this
Agreement or by law and otherwise afforded to any party, shall be cumulative and
not alternative.
20. Provisions Separable. The provisions of this Agreement are
independent and separable from each other, and no provision shall be affected or
rendered invalid or unenforceable by virtue of the fact that for any reason any
other or others of them may be invalid or unenforceable in whole or in part.
21. Gender. Whenever appropriate in this Agreement, terms in the
singular form shall include the plural (and vice versa) and any gender form
shall include all others.
22. Section Headings. Section headings are for the convenience of the
parties and do not form a part of this Agreement.
23. Binding Effect; Parties. This Agreement shall be binding on the
Company, the Subscription Agent, and their respective successors and assigns;
and nothing in this Agreement shall confer upon any other person or entity any
right, remedy, or claim, or impose upon any other person any duty, liability, or
obligation.
24. Execution in Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original as
against any
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party whose signature appears thereon, and all of which shall together
constitute one and the same instrument. This Agreement shall become binding when
one or more counterparts hereof, individually or taken together, shall bear the
signatures of all of the parties reflected hereon as the signatories. Any
facsimile, photographic or xerographic copy of this Agreement, with all
signatures reproduced on one or more sets of signature pages, shall be
considered for all purposes as if it were an executed counterpart of this
Agreement.
25. Exhibits and Schedules; Entire Agreement. All Exhibits and Schedules
referred to herein or attached hereto are hereby incorporated by reference into,
and made a part of, this Agreement. This Agreement together with the Exhibits
and Schedules hereto, contains the entire agreement and understanding among the
parties hereto with respect to the subject matter hereof, and supersedes all
prior and contemporaneous agreements, understandings, inducements and
conditions, express or implied, oral or written, of any nature whatsoever with
respect to the subject matter hereof. The express terms hereof control and
supersede any course of performance and/or usage of the trade inconsistent with
any of the terms hereof. This Agreement may not be modified or amended other
than by an agreement in writing.
26. Controlling Law. THIS AGREEMENT AND ALL QUESTIONS RELATING TO ITS
VALIDITY, INTERPRETATION, PERFORMANCE AND ENFORCEMENT, SHALL BE GOVERNED BY AND
CONSTRUED, INTERPRETED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
COLORADO, NOTWITHSTANDING ANY CONFLICT-OF-LAW PROVISIONS TO THE CONTRARY.
[THE REMINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
TIPPERARY CORPORATION
By:________________________________
Xxxxx X. Xxxxxxxx, Chief Executive Officer
COMPUTERSHARE TRUST COMPANY, INC.
By:________________________________
Name:______________________________
Title:_____________________________
COMPUTERSHARE TRUST COMPANY, INC.
By:________________________________
Name:______________________________
Title:_____________________________
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