Exhibit 1.1
17,600,000 SHARES
XXXXX LIMITED
(A BERMUDA COMPANY)
COMMON SHARES, PAR VALUE US$.01 PER SHARE
UNDERWRITING AGREEMENT
__, 2001
1
, 2001
Xxxxxx Xxxxxxx & Co. Incorporated
Credit Suisse First Boston Corporation
Deutsche Banc Alex. Xxxxx Inc.
Merrill, Lynch, Xxxxxx, Xxxxxx & Xxxxx
Incorporated
Prudential Securities Incorporated
Xxxxxxx Xxxxx Barney Inc.
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Dear Sirs and Mesdames:
Xxxxx Limited, a Bermuda company (the "COMPANY"), proposes to issue and
sell to the several Underwriters (as defined below) 17,600,000 common shares,
par value U.S.$.01 per share (the "FIRM SHARES"). The Company also proposes to
issue and sell to the several Underwriters not more than an additional 2,640,000
common shares, par value U.S.$.01 per share (the "ADDITIONAL SHARES") if and to
the extent that the Representatives shall have determined to exercise, on behalf
of the Underwriters, the right to purchase such common shares granted to the
Underwriters in Section hereof. The Firm Shares and the Additional Shares are
hereinafter collectively referred to as the "SHARES." The common shares having a
par value of U.S.$.01 per share of the Company to be outstanding after giving
effect to the sales contemplated hereby are hereinafter referred to as the
"COMMON SHARES."
The Common Shares, including the Shares, will have attached thereto rights
(the "RIGHTS") to purchase one-thousandth (1/1000) of a share of Series A
Preference Shares, par value US$.01 per share (the "SERIES A PREFERENCE
SHARES"). The Rights are to be issued pursuant to a Rights Agreement (the
"RIGHTS AGREEMENT") dated as of o, 2001 between the Company and Mellon Investor
Services L.L.C.
The Company has filed with the Securities and Exchange Commission (the
"COMMISSION") a registration statement relating to the Shares and the Rights.
The registration statement as amended at the time it becomes effective,
including the information (if any) deemed to be part of the registration
statement at the time of effectiveness pursuant to Rule 430A under the
Securities Act of 1933, as amended
2
(the "SECURITIES ACT"), is hereinafter referred to as the "REGISTRATION
STATEMENT"; the prospectus in the form first used to confirm sales of Shares is
hereinafter referred to as the "PROSPECTUS." If the Company has filed an
abbreviated registration statement to register additional Common Shares pursuant
to Rule 462(b) under the Securities Act (the "RULE 462 REGISTRATION STATEMENT"),
then any reference herein to the term "REGISTRATION STATEMENT" shall be deemed
to include such Rule 462 Registration Statement.
1. REPRESENTATIONS AND WARRANTIES. The Company represents and warrants to
and agrees with each of the Underwriters that:
(a) The Registration Statement has become effective; no stop order
suspending the effectiveness of the Registration Statement is in effect,
and no proceedings for such purpose are pending before or, to the best
knowledge of the Company, threatened by the Commission.
(b) (i) The Registration Statement, when it became effective, did not
contain and, as amended or supplemented, if applicable, will not contain
any 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, (ii) the Registration Statement and the Prospectus comply
and, as amended or supplemented, if applicable, will comply in all
material respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder and (iii) the Prospectus does not
contain and, as amended or supplemented, if applicable, will not contain
any 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, except that the
representations and warranties set forth in this paragraph do not apply to
statements or omissions in the Registration Statement or the Prospectus
based upon information relating to any Underwriter furnished to the
Company in writing by such Underwriter through you expressly for use
therein.
(c) The Company has been duly incorporated, is validly existing as a
company in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to execute and
deliver this Agreement, to perform its obligations hereunder, to own its
property and to conduct its business as described in the Prospectus and is
duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries, taken as a
whole.
(d) Each significant subsidiary (as such term is defined in Rule 1-02 of
Regulation S-X, a "SIGNIFICANT SUBSIDIARY") of the Company has been duly
incorporated, is validly existing as a company and, if applicable, in good
standing under the laws of the jurisdiction of its incorporation, has
3
the corporate power and authority to own its property and to conduct its
business as described in the Prospectus and is duly qualified to transact
business and is in good standing in each jurisdiction in which the conduct
of its business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so qualified or
be in good standing would not have a material adverse effect on the
Company and its subsidiaries, taken as a whole; all of the issued shares
of capital stock of each Significant Subsidiary of the Company have been
duly and validly authorized and issued, are fully paid and non-assessable
and, to the extent disclosed in the Prospectus, are owned directly or
indirectly by the Company, free and clear of all liens, encumbrances,
equities or claims.
(e) This Agreement has been duly authorized, executed and delivered by the
Company.
(f) The authorized share capital of the Company conforms as to legal
matters in all material respects to the description thereof contained in
the Prospectus.
(g) The Common Shares outstanding prior to the issuance of the Shares have
been duly authorized and are validly issued, fully paid and
non-assessable.
(h) The Rights Agreement has been duly authorized, executed and delivered
by the Company; the Rights have been duly authorized by the Company and,
when issued upon issuance of the Shares, will be validly issued; and the
Series A Preference Shares have been duly authorized by the Company and
validly reserved for issuance upon the exercise of the Rights and, when
issued and paid for upon exercise in accordance with the terms of the
Rights Agreement, will be validly issued, fully paid and non-assessable.
(i) The Shares have been duly authorized and, when issued and delivered in
accordance with the terms of this Agreement, will be validly issued, fully
paid and non-assessable, and the issuance of such Shares will not be
subject to any preemptive or similar rights.
(j) The execution and delivery by the Company of, and the performance by
the Company of its obligations under, this Agreement will not contravene
any provision of applicable law or the Memorandum of Association or
Bye-Laws of the Company or any agreement or other instrument binding upon
the Company or any of its subsidiaries that is material to the Company and
its subsidiaries, taken as a whole, or any judgment, order or decree of
any governmental body, agency or court having jurisdiction over the
Company or any subsidiary, and no consent, approval, authorization or
order of, or qualification with, any governmental body or agency is
required for the performance by the Company of its obligations under this
Agreement, except such as may be required by the securities or Blue Sky
laws of the various states in connection with the offer and sale of the
Shares.
(k) There has not occurred any material adverse change, or any
4
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a whole, from
that set forth in the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement).
(l) There are no legal or governmental proceedings pending or threatened
to which the Company or any of its subsidiaries is a party or to which any
of the properties of the Company or any of its subsidiaries is subject
that are required to be described in the Registration Statement or the
Prospectus and are not so described or any statutes, regulations,
contracts or other documents that are required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not described or filed as required.
(m) Each preliminary 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 and the applicable
rules and regulations of the Commission thereunder.
(n) The Company is not, and after giving effect to the offering and sale
of the Shares and the application of the proceeds thereof as described in
the Prospectus will not be, required to register as an "investment
company" as such term is defined in the Investment Company Act of 1940, as
amended.
(o) Except as described in the Prospectus, the Company and its Significant
Subsidiaries (i) are in compliance with any and all applicable foreign,
federal, state and local laws and regulations relating to the protection
of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants ("ENVIRONMENTAL LAWS"),
(ii) have received all permits, licenses or other approvals required of
them under applicable Environmental Laws to conduct their respective
businesses and (iii) are in compliance with all terms and conditions of
any such permit, license or approval, except where such noncompliance with
Environmental Laws, failure to receive required permits, licenses or other
approvals or failure to comply with the terms and conditions of such
permits, licenses or approvals would not, singly or in the aggregate, have
a material adverse effect on the Company and its subsidiaries, taken as a
whole.
(p) To the knowledge of the Company, there are no costs or liabilities
associated with Environmental Laws (including, without limitation, any
capital or operating expenditures required for clean-up, closure of
properties or compliance with Environmental Laws or any permit, license or
approval, any related constraints on operating activities and any
potential liabilities to third parties) which would, singly or in the
aggregate, have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
5
(q) Except as described in the Prospectus, there are no contracts,
agreements or understandings between the Company and any person granting
such person the right to require the Company to file a registration
statement under the Securities Act with respect to any securities of the
Company or to require the Company to include such securities with the
Shares registered pursuant to the Registration Statement.
(r) Subsequent to the respective dates as of which information is given in
the Registration Statement and the Prospectus, (i) the Company and its
subsidiaries have not incurred any material liability or obligation,
direct or contingent, nor entered into any material transaction not in the
ordinary course of business; (ii) the Company has not purchased any of its
outstanding Common Shares, nor declared, paid or otherwise made any
dividend or distribution of any kind on its share capital other than
ordinary and customary dividends; and (iii) there has not been any
material change in the share capital, short-term debt or long-term debt of
the Company and its subsidiaries, except in each case as described in the
Prospectus.
(s) The Company and its Significant Subsidiaries have good and marketable
title in fee simple to all real property and good and marketable title to
all personal property owned by them which is material to the business of
the Company and its subsidiaries, 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 Significant Subsidiaries; and any real
property and buildings held under lease by the Company and its Significant
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 Significant Subsidiaries, in each case except as described
in the Prospectus.
(t) The Company and its Significant Subsidiaries own or possess, or can
acquire on reasonable terms, all material patents, patent rights,
licenses, inventions, copyrights, know-how (including trade secrets and
other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures), trademarks, service marks and trade
names currently employed by them in connection with the business now
operated by them, and neither the Company nor any of its subsidiaries has
received any notice of infringement of or conflict with asserted rights of
others with respect to any of the foregoing which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding,
would have a material adverse effect on the Company and its subsidiaries,
taken as a whole.
(u) No material labor dispute with the employees of the Company or any of
its Significant Subsidiaries exists, or, to the knowledge of the Company,
is imminent, except as described in the Prospectus; and the Company is
6
not aware of any existing, threatened or imminent labor disturbance by the
employees of any of its principal suppliers, manufacturers or contractors
that could have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(v) The Company and each of its Significant Subsidiaries are insured by
insurers of recognized financial responsibility against such losses and
risks and in such amounts as are prudent and customary in the businesses
in which they are engaged; neither the Company nor any of its Significant
Subsidiaries has been refused any insurance coverage sought or applied
for; and neither the company nor any of its Significant Subsidiaries has
any reason to believe that it will not be able to renew its existing
insurance coverage as and when such coverage expires or to obtain similar
coverage from similar insurers as may be necessary to continue its
business at a cost that would not have a material adverse effect on the
Company and its subsidiaries, taken as a whole, except as described in the
Prospectus.
(w) The Company and its Significant Subsidiaries possess all certificates,
authorizations and permits issued by the appropriate federal, state or
foreign regulatory authorities necessary to conduct their respective
businesses, and neither the Company nor any of its Significant
Subsidiaries has received any notice of proceedings relating to the
revocation or modification of any such certificate, authorization or
permit which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would have a material adverse effect on the
Company and its subsidiaries, taken as a whole, except as described in the
Prospectus.
(x) The Company and each of its Significant Subsidiaries maintain a system
of internal accounting controls sufficient to provide reasonable assurance
that (i) transactions are executed in accordance with management's general
or specific authorizations; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with applicable
generally accepted accounting principles and to maintain asset
accountability; (iii) access to assets is permitted only in accordance
with management's general or specific authorization; and (iv) the recorded
accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
2. AGREEMENTS TO SELL AND PURCHASE. The Company hereby agrees to sell to
the several Underwriters, and each Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees, severally and not jointly, to purchase from the
Company the respective numbers of Firm Shares set forth in Schedule I hereto
opposite its name at $__ a share (the "PURCHASE PRICE").
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees to sell
to the Underwriters the Additional Shares, and the Underwriters shall have a
one-
7
time right to purchase, severally and not jointly, up to 2,640,000 Additional
Shares at the Purchase Price. If you, on behalf of the Underwriters, elect to
exercise such option, you shall so notify the Company in writing not later than
30 days after the date of this Agreement, which notice shall specify the number
of Additional Shares to be purchased by the Underwriters and the date on which
such shares are to be purchased. Such date may be the same as the Closing Date
(as defined below) but not earlier than the Closing Date nor later than ten
business days after the date of such notice. Additional Shares may be purchased
as provided in Section hereof solely for the purpose of covering over-allotments
made in connection with the offering of the Firm Shares. If any Additional
Shares are to be purchased, each Underwriter agrees, severally and not jointly,
to purchase the number of Additional Shares (subject to such adjustments to
eliminate fractional shares as you may determine) that bears the same proportion
to the total number of Additional Shares to be purchased as the number of Firm
Shares set forth in Schedule I hereto opposite the name of such Underwriter
bears to the total number of Firm Shares.
The Company hereby agrees that, without the prior written consent of
Xxxxxx Xxxxxxx & Co. Incorporated on behalf of the Underwriters, it will not,
during the period ending 180 days after the date of the Prospectus, (i)
offer, pledge, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right or
warrant to purchase, lend, or otherwise transfer or dispose of, directly or
indirectly, any Common Shares or any securities convertible into or
exercisable or exchangeable for Common Shares or (ii) enter into any swap or
other arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of the Common Shares, whether any such
transaction described in clause (i) or (ii) above is to be settled by
delivery of Common Shares or such other securities, in cash or otherwise. The
foregoing sentence shall not apply to (A) the Shares to be sold hereunder,
(B) the issuance by the Company of Common Shares upon the exercise of an
option or warrant or the conversion of a security outstanding on the date
hereof of which the Underwriters have been advised in writing, (C) issuances
of stock options, restricted stock or other awards granted pursuant to the
Company's employee equity incentive plan or non-employee directors' equity
incentive plan as described in the Prospectus; provided that such awards do
not become exercisable or vest during such 180-day period, or (D) issuances
of Common Shares in connection with the merger or amalgamation with, or
acquisition of another corporation or entity or the acquisition of the assets
or properties of any such corporation or entity and the related entry into a
merger, amalgamation or acquisition agreement with respect to such merger,
amalgamation or acquisition, so long as each of the recipients of the Common
Shares agrees in writing prior to the consummation of any such transaction,
pursuant to an instrument in form and substance reasonably satisfactory to
Xxxxxx Xxxxxxx & Co. Incorporated, to be bound by the provisions of this
paragraph for the remainder of such 180-day period as if such recipients
8
were the Company, and the public announcements and related filings of
registration statements with respect to any such issuances; provided that if the
Company is unable to obtain signed, written lock-up agreements from the
recipients of the Common Shares in connection with a merger, amalgamation or
acquisition as described in clause (D) of this paragraph, then only the entry
into the merger, amalgamation or acquisition agreement, the public announcement
of such transaction and the related filing of a registration statement shall be
permitted and not the related issuance of the Common Shares.
3. TERMS OF PUBLIC OFFERING. The Company is advised by you that the
Underwriters propose to make a public offering of their respective portions
of the Shares as soon after the Registration Statement and this Agreement
have become effective as in your judgment is advisable. The Company is
further advised by you that the Shares are to be offered to the public
initially at $__ a share (the "PUBLIC OFFERING PRICE") and to certain dealers
selected by you at a price that represents a concession not in excess of $__
a share under the Public Offering Price, and that any Underwriter may allow,
and such dealers may reallow, a concession, not in excess of $__ a share, to
any Underwriter or to certain other dealers.
4. PAYMENT AND DELIVERY. Payment for the Firm Shares shall be made to
the Company in Federal or other funds immediately available in New York City
against delivery of such Firm Shares for the respective accounts of the
several Underwriters at 10:00 a.m., New York City time, on __, 2001, or at
such other time on the same or such other date, not later than __, 2001, as
shall be designated in writing by you. The time and date of such payment are
hereinafter referred to as the "CLOSING DATE."
Payment for any Additional Shares shall be made to the Company in
Federal or other funds immediately available in New York City against
delivery of such Additional Shares for the respective accounts of the several
Underwriters at 10:00 a.m., New York City time, on the date specified in the
notice described in Section or at such other time on the same or on such
other date, in any event not later than __, 2001, as shall be designated in
writing by you. The time and date of such payment are hereinafter referred to
as the "OPTION CLOSING DATE."
Certificates for the Firm Shares and Additional Shares shall be in
definitive form and registered in such names and in such denominations as you
shall request in writing not later than one full business day prior to the
Closing Date or the Option Closing Date, as the case may be. The certificates
evidencing the Firm Shares and Additional Shares shall be delivered to you on
the Closing Date or the Option Closing Date, as the case may be, for the
respective accounts of the several Underwriters, with any transfer taxes payable
in connection with the transfer of the Shares to the Underwriters duly paid,
against payment of the Purchase Price therefor.
5. CONDITIONS TO THE UNDERWRITERS' OBLIGATIONS. The obligations of the
Company to sell the Shares to the Underwriters and the several obligations of
the
9
Underwriters to purchase and pay for the Shares on the Closing Date are subject
to the condition that the Registration Statement shall have become effective not
later than __ (New York City time) on the date hereof.
The several obligations of the Underwriters are subject to the following
further conditions:
(a) Subsequent to the execution and delivery of this Agreement and prior
to the Closing Date:
(i) there shall not have occurred any downgrading, nor shall
any notice have been given of any intended or potential downgrading
or of any review for a possible change that does not indicate the
direction of the possible change, in the rating accorded any of the
securities of the Company by any "nationally recognized statistical
rating organization," as such term is defined for purposes of Rule
436(g)(2) under the Securities Act; and
(ii) there shall not have occurred any change, or any
development involving a prospective change, in the condition,
financial or otherwise, or in the earnings, business or operations
of the Company and its subsidiaries, taken as a whole, from that set
forth in the Prospectus (exclusive of any amendments or supplements
thereto subsequent to the date of this Agreement) that, in your
judgment, is material and adverse and that makes it, in your
judgment, impracticable to market the Shares on the terms and in the
manner contemplated in the Prospectus.
(b) The Underwriters shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer of
the Company, to the effect set forth in Section above and to the effect
that the representations and warranties of the Company contained in this
Agreement are true and correct as of the Closing Date and that the Company
has complied with all of the agreements and satisfied all of the
conditions on its part to be performed or satisfied hereunder on or before
the Closing Date.
The officer signing and delivering such certificate may rely upon
the best of his or her knowledge as to proceedings threatened.
(c) The Underwriters shall have received on the Closing Date an opinion of
Xxxxxxx Xxxx & Xxxxxxx, special Bermuda counsel for the Company, dated the
Closing Date, to the effect that:
(i) the Company is duly incorporated and validly existing
under the laws of Bermuda in good standing;
(ii) the Company has the necessary corporate power and
authority to execute, deliver and perform its obligations under this
Agreement and to conduct its business as described in the
Prospectus. The execution and delivery of this Agreement by the
Company and the performance by the Company of its obligations
10
hereunder will not violate the Memorandum of Association or By-Laws
of the Company nor any applicable law, regulation, order or decree
in Bermuda;
(iii) the Company has taken all corporate action required to
authorize its execution, delivery and performance of this Agreement.
This Agreement has been duly executed and delivered by or on behalf
of the Company, and constitutes the valid and binding obligations of
the Company in accordance with the terms hereof;
(iv) no order, consent, approval, license, authorization or
validation of or exemption by any government or public body or
authority of Bermuda or any sub-division thereof is required to
authorize or is required in connection with the execution, delivery,
performance and enforcement of this Agreement, except such as have
been duly obtained in accordance with Bermuda Law;
(v) based solely upon a search of the Cause Book of the
Supreme Court of Bermuda conducted at a time reasonably close to the
Closing Date (which would not reveal details of proceedings which
have been filed but not actually entered in the Cause Book at the
time of such search), there are no judgments against the Company,
nor any legal or governmental proceedings pending in Bermuda to
which the Company is subject;
(vi) the authorized capital of the Company conforms, as to
legal matters, to the description thereof contained in the
Prospectus in all material respects;
(vii) the common shares of the Company in issue prior to the
issuance of the Shares are validly issued, fully paid and
non-assessable. When issued and paid for in accordance with this
Agreement, the Shares will be validly issued, fully paid and
non-assessable and will not be subject to any statutory pre-emptive
or similar rights; and
(viii) the statements contained in the Prospectus under the
captions "Description of Share Capital," "Taxation -- Bermuda Tax
Considerations" and "Enforcement of Civil Liabilities," insofar as
such statements constitute a summary of the matters of Bermuda law
referred to therein, fairly represent such legal matters in all
material respects.
(d) The Underwriters shall have received on the Closing Date an opinion of
Shearman & Sterling, special U.S. counsel for the Company, dated the
Closing Date, to the effect that:
(i) this Agreement has been duly executed and delivered by the
Company;
(ii) the execution and delivery by the Company of, and the
performance by the Company of its obligations under, this
11
Agreement will not contravene any provision of U.S. federal or New
York law or any agreement or other instrument that is listed as an
exhibit to the Registration Statement that is governed by New York
law binding upon the Company or any of its subsidiaries, and no
consent, approval, authorization or order of, or qualification with,
any governmental body or agency is required for the performance by
the Company of its obligations under this Agreement, except such as
may be required by the securities or Blue Sky laws of the various
states in connection with the offer and sale of the Shares;
(iii) the Company is not, and after giving effect to the
offering and sale of the Shares and the application of the proceeds
thereof as described in the Prospectus will not be, required to
register as an "investment company" as such term is defined in the
Investment Company Act of 1940, as amended;
(iv) such counsel (A) is of the opinion that the Registration
Statement and Prospectus (except for financial statements and
schedules and other financial and statistical data included therein
as to which such counsel need not express any opinion) comply as to
form in all material respects with the Securities Act and the
applicable rules and regulations of the Commission thereunder, (B)
has no reason to believe that (except for financial statements and
schedules and other financial and statistical data as to which such
counsel need not express any belief) the Registration Statement and
the prospectus included therein at the time the Registration
Statement became effective contained any 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 and (C) has no reason to believe that (except for
financial statements and schedules and other financial and
statistical data as to which such counsel need not express any
belief) the Prospectus contains any 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;
(v) the statements in the Prospectus under the caption "Shares
Eligible for Future Sale," insofar as such statements constitute
summaries of the legal matters, documents or proceedings referred to
therein, fairly present the information called for with respect to
such legal matters, documents and proceedings and fairly summarize
the matters referred to therein in all material respects; and
12
(vi) the statements in the Prospectus under the caption
"Taxation--United States Federal Income Tax Considerations" are an
accurate summary of the U.S. federal income tax matter described
therein.
(e) The Underwriters shall have received on the Closing Date opinions of
Xxxxx Xxxx Xxxxx, General Counsel for the Company, dated the Closing Date,
to the effect that:
(i) each Significant Subsidiary of the Company has been duly
incorporated, is validly existing as a company and, if applicable,
in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its
property and to conduct its business as described in the Prospectus
and is duly qualified to transact business and is in good standing
in each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification, except
to the extent that the failure to be so qualified or be in good
standing would not have a material adverse effect on the Company and
its subsidiaries, taken as a whole;
(ii) to the extent disclosed in the Prospectus and the
Registration Statement, all of the issued shares of capital stock of
each Significant Subsidiary of the Company have been duly and
validly authorized and issued, are fully paid and non-assessable,
and are owned directly or indirectly by the Company, free and clear
of all liens, encumbrances, equities or claims;
(iii) to such counsel's knowledge, none of the Company's
Significant Subsidiaries is presently (a) in material violation of
its charter or bylaws, or (b) in material breach of any applicable
statute, rule or regulation known to such counsel or, to such
counsel's knowledge, any order, writ or decree of any court or
governmental agency or body having jurisdiction over such
subsidiaries or over any of their properties or operations;
(iv) to such counsel's knowledge (a) there are no legal or
governmental proceedings pending or threatened to which any of the
Company's Significant Subsidiaries is a party or to which any of the
properties of the Company's Significant Subsidiaries is subject that
are required to be described in the Registration Statement or the
Prospectus and are not so described, and (b) there are no statutes
or regulations, contracts or other documents that are required to be
described in the Registration Statement or the Prospectus or to be
filed as exhibits to the Registration Statement that are not
described or filed as required;
(v) the Company's Significant Subsidiaries (A) are in
compliance with any and all applicable Environmental Laws, (B) have
13
received all permits, licenses or other approvals required of them
under applicable Environmental Laws to conduct their respective
businesses and (C) are in compliance with all terms and conditions
of any such permit, license or approval, except where such
noncompliance with Environmental Laws, failure to receive required
permits, licenses or other approvals or failure to comply with the
terms and conditions of such permits, licenses or approvals would
not, singly or in the aggregate, have a material adverse effect on
the Company and its subsidiaries, taken as a whole;
(vi) to such counsel's knowledge, there are no statutes or
regulations, contracts or other documents that are required to be
described in the Registration Statement or the Prospectus or to be
filed as exhibits to the Registration Statement that are not
described or filed as required; and
(vii) the statements in the Prospectus under the captions
"Business-Government Regulation and Environmental Matters",
"Business-Legal Proceedings" and "Related Party Transactions",
insofar as such statements constitute summaries of the legal
matters, documents or proceedings referred to therein, fairly
present the information called for with respect to such legal
matters, documents and proceedings and fairly summarize the matters
referred to therein, in all material respects.
(f) The Underwriters shall have received on the Closing Date opinions of
Machado, Meyer, Sendacz e Opice Advogados, Brazilian counsel to the
Underwriters, dated the Closing Date, to the effect that:
(i) each of Xxxxx Alimentos S.A. and Xxxxx Fertilizantes S.A.
has been duly incorporated, is validly existing as a corporation
and, if applicable, in good standing under the laws of Brazil, has
the corporate power and authority to own its property and to conduct
its business as described in the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction in
which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries, taken
as a whole;
(ii) all of the issued shares of capital stock of each of
Xxxxx Alimentos S.A. and Xxxxx Fertilizantes S.A. have been duly and
validly authorized and issued, are fully paid and non-assessable
and, to the extent disclosed in the Prospectus, are owned directly
by the Company, free and clear of all liens, encumbrances, equities
or claims; and
(iii) the statements in the Prospectus under the captions
"Risk Factors--We have not yet received approval from the Brazilian
antitrust authorities for our acquisition of Manah",
"Business--Government Regulation and Environmental Matters",
"Business--Legal Proceedings", insofar as such statements constitute
summaries of the legal matters, documents or
14
proceedings referred to therein, fairly present the information
called for with respect to such legal matters, documents and
proceedings and fairly summarize the matters referred to therein.
(g) The Underwriters shall have received on the Closing Date an opinion of
Xxxxx Xxxx & Xxxxxxxx, counsel for the Underwriters, dated the Closing
Date, covering the matters referred to in Sections 5(d)(iv) and 5(d)(v)
above.
With respect to Section 5(d)(iv) above, Shearman & Sterling and
Xxxxx Xxxx & Xxxxxxxx may state that their opinion and belief are based
upon their participation in the preparation of the Registration Statement
and Prospectus and any amendments or supplements thereto and review and
discussion of the contents thereof, but are without independent check or
verification, except as specified.
The opinions of Xxxxxxx Xxxx & Xxxxxxx, Xxxxxxxx & Sterling and Xxxxx
Xxxx Xxxxx as described in Sections 5(C), (d) and (e) above, shall each
be rendered to the Underwriters at the request of the Company and shall
so state therein.
(h) The Underwriters shall have received, on each of the date hereof and
the Closing Date, a letter dated the date hereof or the Closing Date, as
the case may be, in form and substance satisfactory to the Underwriters,
from Deloitte & Touche, independent public accountants, containing
statements and information of the type ordinarily included in accountants'
"comfort letters" to underwriters with respect to the financial statements
and certain financial information contained in the Registration Statement
and the Prospectus; PROVIDED that the letter delivered on the Closing Date
shall use a "cut-off date" not earlier than the date hereof.
(i) The "lock-up" agreements, each substantially in the form of Exhibit A
hereto, between you and certain shareholders, officers and directors of
the Company relating to sales and certain other dispositions of shares of
Common Shares or certain other securities, delivered to you on or before
the date hereof, shall be in full force and effect on the Closing Date.
The several obligations of the Underwriters to purchase Additional Shares
hereunder are subject to the delivery to you on the Option Closing Date of such
documents as you may reasonably request with respect to the good standing of the
Company, the due authorization and issuance of the Additional Shares and other
matters related to the issuance of the Additional Shares.
6. COVENANTS OF THE COMPANY. In further consideration of the agreements of
the Underwriters herein contained, the Company covenants with each Underwriter
as follows:
(a) To furnish to you, without charge, __ signed copies of the
Registration Statement (including exhibits thereto) and for delivery to
each other Underwriter a conformed copy of the Registration Statement
(without
15
exhibits thereto) and to furnish to you in New York City, without charge,
prior to 10:00 a.m. New York City time on the business day next succeeding
the date of this Agreement and during the period mentioned in Section
below, as many copies of the Prospectus and any supplements and amendments
thereto or to the Registration Statement as you may reasonably request.
(b) Before amending or supplementing the Registration Statement or the
Prospectus, to furnish to you a copy of each such proposed amendment or
supplement and not to file any such proposed amendment or supplement to
which you reasonably object, and to file with the Commission within the
applicable period specified in Rule 424(b) under the Securities Act any
prospectus required to be filed pursuant to such Rule.
(c) If, during such period after the first date of the public offering of
the Shares as in the opinion of counsel for the Underwriters the
Prospectus is required by law to be delivered in connection with sales by
an Underwriter or dealer, any event shall occur or condition exist as a
result of which it is necessary to amend or supplement the Prospectus in
order to make the statements therein, in the light of the circumstances
when the Prospectus is delivered to a purchaser, not misleading, or if, in
the opinion of counsel for the Underwriters, it is necessary to amend or
supplement the Prospectus to comply with applicable law, forthwith to
prepare, file with the Commission and furnish, at its own expense, to the
Underwriters and to the dealers (whose names and addresses you will
furnish to the Company) to which Shares may have been sold by you on
behalf of the Underwriters and to any other dealers upon request, either
amendments or supplements to the Prospectus so that the statements in the
Prospectus as so amended or supplemented will not, in the light of the
circumstances when the Prospectus is delivered to a purchaser, be
misleading or so that the Prospectus, as amended or supplemented, will
comply with law.
(d) To endeavor to qualify the Shares for offer and sale under the
securities or Blue Sky laws of such jurisdictions as you shall reasonably
request.
(e) To make generally available to the Company's security holders and to
you as soon as practicable an earning statement covering the twelve-month
period ending September 30, 2002 that satisfies the provisions of Section
11(a) of the Securities Act and the rules and regulations of the
Commission thereunder.
(f) Whether or not the transactions contemplated in this Agreement are
consummated or this Agreement is terminated, to pay or cause to be paid
all reasonable expenses incident to the performance of its obligations
under this Agreement, including: (i) the fees, disbursements and expenses
of the Company's counsel and the Company's accountants in connection with
the registration and delivery of the Shares under the Securities Act and
all other fees or expenses in connection with the preparation and filing
of the Registration Statement, any preliminary prospectus, the Prospectus
16
and amendments and supplements to any of the foregoing, including all
printing costs associated there-with, and the mailing and delivering of
copies thereof to the Underwriters and dealers, in the quantities
hereinabove specified, (ii) all costs and expenses related to the transfer
and delivery of the Shares to the Underwriters, including any transfer or
other taxes payable thereon, (iii) the cost of printing or producing any
Blue Sky or Legal Investment memorandum in connection with the offer and
sale of the Shares under state securities laws and all expenses in
connection with the qualification of the Shares for offer and sale under
state securities laws as provided in Section hereof, including filing fees
and the reasonable fees and disbursements of counsel for the Underwriters
in connection with such qualification and in connection with the Blue Sky
or Legal Investment memorandum, (iv) all filing fees and the reasonable
fees and disbursements of counsel to the Underwriters incurred in
connection with the review and qualification of the offering of the Shares
by the National Association of Securities Dealers, Inc. (the "NASD"),
including the reasonable fees and disbursements of counsel to Xxxxxx
Xxxxxxx in its capacity as "qualified independent underwriter" within the
meaning of Rule 2720 of the NASD's Conduct Rules ("QIU"), (v) all fees and
expenses in connection with the preparation and filing of the registration
statement on Form 8-A relating to the Common Shares and all costs and
expenses incident to listing the Shares on the New York Stock Exchange,
(vi) the cost of printing certificates represen-ting the Shares, (vii) the
costs and charges of any transfer agent, registrar or depositary, (viii)
the costs and expenses of the Company relating to investor presentations
on any "road show" undertaken in connection with the marketing of the
offering of the Shares, including, without limitation, expenses associated
with the production of road show slides and graphics, fees and expenses of
any consultants engaged in connection with the road show presentations
with the prior approval of the Company, travel and lodging expenses of the
representatives and officers of the Company and any such consultants, and
one-half of the cost of any aircraft chartered in connection with the road
show, and (ix) all other costs and expenses incident to the perfor-xxxxx
of the obligations of the Company hereunder for which provision is not
otherwise made in this Section. It is understood, however, that except as
provided in this Section, Section entitled "Indemnity and Contribution",
and the last paragraph of Section below, the Underwriters will pay all of
their costs and expenses, including fees and disbursements of their
counsel, stock transfer taxes payable on resale of any of the Shares by
them and any advertising expenses connected with any offers they may make.
7. INDEMNITY AND CONTRIBUTION. (a) The Company agrees to indemnify and
hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of either Section 15 of the Securities Act or
Section 20 of the Securities Exchange Act of 1934, as amended (the "EXCHANGE
17
ACT"), from and against any and all losses, claims, damages and liabilities
(including, without limitation, any legal or other expenses reasonably incurred
in connection with defending or investigating any such action or claim) caused
by any untrue statement or alleged untrue statement of a material fact contained
in the Registration Statement or any amendment thereof, any preliminary
prospectus or the Prospectus (as amended or supplemented if the Company shall
have furnished any amendments or supplements thereto), or caused by any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, except
insofar as such losses, claims, damages or liabilities are caused by any such
untrue statement or omission or alleged untrue statement or omission based upon
information relating to any Underwriter furnished to the Company in writing by
such Underwriter through you expressly for use therein, PROVIDED, HOWEVER, that
the foregoing indemnity agreement with respect to any preliminary prospectus
shall not inure to the benefit of any Underwriter from whom the person asserting
any such losses, claims, damages or liabilities purchased Shares or any person
controlling such Underwriter, if a copy of the Prospectus (as then amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto) was not sent or given by or on behalf of such Underwriter to such
person, if required by law so to have been delivered, at or prior to the written
confirmation of the sale of the Shares to such person, and if the Prospectus (as
so amended or supplemented) would have cured the defect giving rise to such
losses, claims, damages or liabilities, unless such failure is the result of
noncompliance by the Company with Section 6(a) hereof.
The Company also agrees to indemnify and hold harmless Xxxxxx Xxxxxxx &
Co. Incorporated ("XXXXXX XXXXXXX") and each person, if any, who controls Xxxxxx
Xxxxxxx within the meaning of either Section 15 of the Securities Act, or
Section 20 of the Exchange Act, from and against any and all losses, claims,
damages, liabilities and judgments incurred as a result of Xxxxxx Xxxxxxx'x
participation as a QIU in connection with the offering of the Shares, except for
any losses, claims, damages, liabilities, and judgments resulting from Xxxxxx
Xxxxxxx'x, or such controlling person's, willful misconduct.
(b) Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Company, its directors, its officers who sign the Registration
Statement and each person, if any, who controls the Company within the meaning
of either Section 15 of the Securities Act or Section 20 of the Exchange Act to
the same extent as the foregoing indemnity from the Company to such Underwriter,
but only with reference to information relating to such Underwriter furnished to
the Company in writing by such Underwriter through you expressly for use in the
Registration Statement, any preliminary prospectus, the Prospectus or any
amendments or supplements thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to Section or , such person (the "INDEMNIFIED PARTY")
18
shall promptly notify the person against whom such indemnity may be sought (the
"INDEMNIFYING PARTY") in writing and the indemnifying party, upon request of the
indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for the fees and expenses of more than one separate firm (in addition
to any local counsel) for all such indemnified parties and that all such fees
and expenses shall be reimbursed as they are incurred. Such firm shall be
designated in writing by Xxxxxx Xxxxxxx & Co. Incorporated, in the case of
parties indemnified pursuant to Section , and by the Company, in the case of
parties indemnified pursuant to Section . The indemnifying party shall not be
liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or judgment.
No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened proceeding
in respect of which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party, unless
such settlement includes an unconditional release of such indemnified party from
all liability on claims that are the subject matter of such proceeding.
Notwithstanding anything contained herein to the contrary, if indemnity
may be sought pursuant to the second paragraph of Section 7(a) hereof in respect
of such action or proceeding, then in addition to such separate firm for the
indemnified parties, the indemnifying party shall be liable for the reasonable
fees and expenses of not more than one separate firm (in addition to any local
counsel) for Xxxxxx Xxxxxxx in its capacity as a QIU and all persons, if any,
who control Xxxxxx Xxxxxxx within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act.
(d) To the extent the indemnification provided for in Section or is
unavailable to an indemnified party or insufficient in respect of any losses,
claims, damages or liabilities referred to therein, then each indemnifying party
under such paragraph, in lieu of indemnifying such indemnified party thereunder,
shall contribute to the amount paid or payable by such indemnified party as a
19
result of such losses, claims, damages or liabilities (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company on the
one hand and the Underwriters on the other hand from the offering of the Shares
or (ii) if the allocation provided by clause above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause above but also the relative fault of the
Company on the one hand and of the Underwriters on the other hand in connection
with the statements or omissions that resulted in such losses, claims, damages
or liabilities, as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and the Underwriters
on the other hand in connection with the offering of the Shares shall be deemed
to be in the same respective proportions as the net proceeds from the offering
of the Shares (before deducting expenses) received by the Company and the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth in the table on the cover of the Prospectus, bear to the
aggregate Public Offering Price of the Shares. The relative fault of the Company
on the one hand and the Underwriters on the other hand shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or by the Underwriters and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Underwriters' respective
obligations to contribute pursuant to this Section are several in proportion to
the respective number of Shares they have purchased hereunder, and not joint.
(e) The Company and the Underwriters agree that it would not be just or
equitable if contribution pursuant to this Section were determined by PRO RATA
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in Section . The amount paid or payable by
an indemnified party as a result of the losses, claims, damages and liabilities
referred to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
Section , no Underwriter shall be required to contribute any amount in excess of
the amount by which the total price at which the Shares underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages that such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The remedies provided
for in this Section are not exclusive and shall not limit any rights or remedies
which may otherwise be available to any indemnified party at law or in equity.
(f) The indemnity and contribution provisions contained in this
20
Section and the representations, warranties and other statements of the Company
contained in this Agreement shall remain operative and in full force and effect
regardless of (i) any termination of this Agreement, (ii) any investigation made
by or on behalf of any Underwriter or any person controlling any Underwriter or
by or on behalf of the Company, its officers or directors or any person
controlling the Company and (iii) acceptance of and payment for any of the
Shares.
8. TERMINATION. This Agreement shall be subject to termination by notice
given by you to the Company, if (a) after the execution and delivery of this
Agreement and prior to the Closing Date (i) trading generally shall have been
suspended or materially limited on or by, as the case may be, any of the New
York Stock Exchange, the American Stock Exchange, the National Association of
Securities Dealers, Inc., the Chicago Board of 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 and adverse and (b) in the case of any of
the events specified in clauses through , such event, singly or together with
any other such event, makes it, in your judgment, impracticable to market the
Shares on the terms and in the manner contemplated in the Prospectus.
9. EFFECTIVENESS; DEFAULTING UNDERWRITERS. This Agreement shall become
effective upon the execution and delivery hereof by the parties hereto.
If, on the Closing Date or the Option Closing Date, as the case may be,
any one or more of the Underwriters shall fail or refuse to purchase Shares that
it has or they have agreed to purchase hereunder on such date, and the aggregate
number of Shares which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase is not more than one-tenth of the aggregate number
of the Shares to be purchased on such date, the other Underwriters shall be
obligated severally in the proportions that the number of Firm Shares set forth
opposite their respective names in Schedule I bears to the aggregate number of
Firm Shares set forth opposite the names of all such non-defaulting
Underwriters, or in such other proportions as you may specify, to purchase the
Shares which such defaulting Underwriter or Underwriters agreed but failed or
refused to purchase on such date; PROVIDED that in no event shall the number of
Shares that any Underwriter has agreed to purchase pursuant to this Agreement be
increased pursuant to this Section by an amount in excess of one-ninth of such
number of Shares without the written consent of such Underwriter. If, on the
Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase
Firm Shares and the aggregate number of Firm Shares with respect to which such
default occurs is more than one-tenth of the aggregate number of Firm Shares to
be purchased, and arrangements satisfactory to you and the Company for the
purchase of such Firm Shares are not made within 36 hours after such default,
this Agreement shall terminate without liability on the part of any
non-defaulting Underwriter or the
21
Company. In any such case either you or the Company shall have the right to
postpone the Closing Date, but in no event for longer than seven days, in order
that the required changes, if any, in the Registration Statement and in the
Prospectus or in any other documents or arrangements may be effected. If, on the
Option Closing Date, any Underwriter or Underwriters shall fail or refuse to
purchase Additional Shares and the aggregate number of Additional Shares with
respect to which such default occurs is more than one-tenth of the aggregate
number of Additional Shares to be purchased, the non-defaulting Underwriters
shall have the option to (i) terminate their obligation hereunder to purchase
Additional Shares or (ii) purchase not less than the number of Additional Shares
that such non-defaulting Underwriters would have been obligated to purchase in
the absence of such default. Any action taken under this paragraph shall not
relieve any defaulting Underwriter from liability in respect of any default of
such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of them,
because of any failure or refusal on the part of the Company to comply with the
terms or to fulfill any of the conditions of this Agreement, or if for any
reason the Company shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the reasonable fees and disbursements of their
counsel) reasonably incurred by such Underwriters in connection with this
Agreement or the offering contemplated hereunder.
10. SUBMISSION TO JURISDICTION; APPOINTMENT OF AGENT FOR SERVICE. The
Company irrevocably agrees that any legal suit, action or proceeding brought by
any Underwriter or by any person who controls any Underwriter arising out of or
relating to this Agreement or the transactions contemplated hereby may be
instituted in any federal or state court in the Borough of Manhattan, The City
of New York, the State of New York and irrevocably waives, to the fullest extent
permitted by law, any objection which it may now or hereafter have to the laying
of the venue of any such suit, action or proceeding and any claim of
inconvenient forum, and irrevocably submits to the non-exclusive jurisdiction of
any such court in any such suit, action or proceeding.
The Company (i) irrevocably designates and appoints its principal
executive offices at 00 Xxxx Xxxxxx, Xxxxx Xxxxxx, Xxx Xxxx 00000 (together with
any successor, the "AUTHORIZED AGENT"), as its authorized agent upon which
process may be served in any suit, action or proceeding described in the first
sentence of this Section 10 and represents and warrants that the Authorized
Agent has accepted such designation and (ii) agrees that service of process upon
the Authorized Agent and written notice of said service to the Company mailed or
delivered to its Chief Financial Officer at its registered office at 0 Xxxxxx
Xxxxxx, Xxxxxxxx, Xxxxxxx, shall be deemed in every respect effective service of
process upon the Company in any such suit or proceeding. The Company further
agrees to
22
take any and all action, including the execution and filing of any and all such
documents and instruments, as may be necessary to continue such designation and
appointment of the Authorized Agent in full force and effect so long as any of
the Shares shall be outstanding.
11. COUNTERPARTS. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
12. APPLICABLE LAW. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York.
13. HEADINGS. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
Very truly yours,
XXXXX LIMITED
By:
--------------------------------
Name:
Title:
Accepted as of the date hereof
XXXXXX XXXXXXX & CO. INCORPORATED
CREDIT SUISSE FIRST BOSTON CORPORATION
DEUTSCHE BANC SECURITIES INC.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
PRUDENTIAL SECURITIES INCORPORATED
XXXXXXX XXXXX BARNEY INC.
Acting severally on behalf of themselves and the several Underwriters named in
Schedule I hereto.
By: Xxxxxx Xxxxxxx & Co. Incorporated
By:
--------------------------------
Name:
Title:
23
SCHEDULE I
UNDERWRITERS
UNDERWRITER NUMBER OF FIRM SHARES
TO BE PURCHASED
Xxxxxx Xxxxxxx & Co. Incorporated
Credit Suisse First Boston Corporation.
Deutsche Banc Securities Inc.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Prudential Securities Incorporated
Xxxxxxx Xxxxx Barney Inc.
Total Firm Shares:
24
EXHIBIT A
FORM OF LOCK-UP LETTER
____________, 2001
Xxxxxx Xxxxxxx & Co. Incorporated
Credit Suisse First Boston Corporation
Deutsche Bank Securities Inc.
Xxxxxxx Lynch, Pierce, Xxxxxx
& Xxxxx Incorporated
Prudential Securities Incorporated
Xxxxxxx Xxxxx Barney Inc.
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Dear Sirs and Mesdames:
The undersigned understands that Xxxxxx Xxxxxxx & Co. Incorporated
("XXXXXX XXXXXXX") propose to enter into an Underwriting Agreement (the
"UNDERWRITING AGREEMENT") with Xxxxx Limited, a Bermuda corporation (the
"COMPANY") providing for the public offering (the "PUBLIC OFFERING") by the
several Underwriters, including Xxxxxx Xxxxxxx (the "UNDERWRITERS") of shares
(the "SHARES") of the common stock of the Company (the " COMMON SHARES").
To induce the Underwriters that may participate in the Public Offering to
continue their efforts in connection with the Public Offering, the undersigned
hereby agrees that, without the prior written consent of Xxxxxx Xxxxxxx on
behalf of the Underwriters, it will not, during the period commencing on the
date hereof and ending 180 days after the date of the final prospectus relating
to the Public Offering (the "PROSPECTUS"), (1) offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase, lend, or otherwise
transfer or dispose of, directly or indirectly, any Common Shares or any
securities convertible into or exercisable or exchangeable for Common Shares, or
(2) enter into any swap or other arrangement that transfers to another, in whole
or in part, any of the economic consequences of ownership of the Common Shares,
whether any such transaction described in clause (1) or (2) above is to be
settled by delivery of Common Shares or such other securities, in cash or
otherwise. The foregoing sentence shall not apply to (a) the sale of any Shares
to the Underwriters pursuant to the Underwriting Agreement, (b) transactions
relating to Common Shares or other securities acquired in open market
transactions after the completion of the Public
25
Offering, (c) transfers of Common Shares by gift, will or intestacy, including,
without limitation transfers to a Privileged Relation (as defined below) of the
undersigned or to a settlement or trust established under the laws of any
country, (d) transfers to affiliates (as defined in Regulation C under the
Securities Act of 1933, as amended) of the undersigned, (e) transfers as a
distribution to limited partners, members or shareholders of the undersigned,
and, in the case of a settlement or trust, to the beneficiaries thereof, (f)
transfers occurring by operation of law, (g) pledges of Common Shares to a bank
or other financial institution or (h) transfers to other shareholders of the
Company that have executed lock-up agreements in connection with the Public
Offering; PROVIDED, that any transferee or pledgee pursuant to clauses (c)
through (g) of this sentence (i) shall execute a lock-up agreement in
substantially the form hereof covering the remainder of the 180-day period
referred to herein and (ii) no filing by any party, including any donor, donee,
transferor or transferee, under Section 16(a) of the Securities Exchange Act of
1934, as amended, shall be required or shall be made voluntarily in connection
with such transfer or pledge, other than a filing on a Form 5 made after the
expiration of the 180-day period referred to above. In addition, the undersigned
agrees that, without the prior written consent of Xxxxxx Xxxxxxx on behalf of
the Underwriters, it will not, during the period commencing on the date hereof
and ending 180 days after the date of the Prospectus, make any demand for or
exercise any right with respect to, the registration of any Common Shares or any
security convertible into or exercisable or exchangeable for Common Shares. The
undersigned also agrees and consents to the entry of stop transfer instructions
with the Company's transfer agent and registrar against the transfer of the
undersigned's Common Shares except in compliance with the foregoing
restrictions.
The undersigned understands that the Company and the Underwriters are
relying upon this Lock-Up Agreement in proceeding toward consummation of the
Public Offering. The undersigned further understands that this Lock-Up Agreement
is irrevocable and shall be binding upon the undersigned's heirs, legal
representatives, successors and assigns.
This Lock-Up Agreement shall automatically terminate and have no further
force or effect if the Company and the Underwriters agree not to proceed with
the Public Offering or the Registration Statement for the Public Offering is not
declared effective by the Securities and Exchange Commission by December 31,
2001.
26
Whether or not the Public Offering actually occurs depends on a number of
factors, including market conditions. Any Public Offering will only be made
pursuant to an Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriters.
Very truly yours,
----------------------------------
Name
----------------------------------
Address
*Lock-up letters will need to be executed by all those persons or entities who
have the power to vote or dispose of the Common Shares (for example, (i) a
trustee, in case the shares are held by a trust on behalf of the beneficial
owners, (ii) an individual, in case the shares are held directly by that person,
or (iii) an authorized corporate officer, in case the shares are owned by a
corporation).
**"Privileged Relation" in relation to an individual means his or her spouse and
any relative of such individual with a common ancestor up to the fourth degree
(including adopted children who have been adopted as a minor and step-children
who have acquired that relationship with such individual or with any such
relative as a minor) and any spouse of any such relative.
27