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EXHIBIT 1
TERMS AGREEMENT
January 22, 1999
ARISTAR, INC.
0000 Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxxxx 00000
Dear Sirs:
We (the "Underwriters" and the "Representatives") understand
that Aristar, Inc., a Delaware corporation (the "Company"), proposes to issue
and sell $ 200,000,000 aggregate principal amount of its 5.85% Senior Notes due
January 27, 2004 (the "Underwritten Securities"). Subject to the terms and
conditions set forth herein or incorporated by reference herein, the
Underwriters hereby offer to purchase, severally and not jointly, the principal
amount of Underwritten Securities set forth opposite their respective names
below at 99.25% of the principal amount thereof, together with accrued interest
thereon, if any, from January 27, 1999 to (but not including) the Delivery Date.
Principal
Underwriter Amount
----------- ------------
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated........ $120,000,000
Xxxxxxx, Sachs & Co....................................... 40,000,000
Xxxxxxx Xxxxx Xxxxxx Inc.................................. 40,000,000
------------
Total................................... $ 200,000,000
============
The Underwritten Securities shall have the following terms:
Date of maturity: January 27, 2004
Interest rate: 5.85% per annum, payable semiannually
Initial public offering price: 99.85%, plus accrued interest, if any, from January 27, 1999 to
(but not including) the Delivery Date
Interest payment dates: January 27th and July 27th, commencing July 27, 1999
Redemption provisions: The Underwritten Securities are not redeemable
Form: The Underwritten Securities are to be issued in the form of one or
more global securities registered in the name of The Depository Trust
Company or its nominee (the "Depositary"); delivery of the
Underwritten Securities at closing will be made through the
facilities of the Depositary
Specified funds for payment
of purchase price: Wire transfer of immediately available funds
Specified address for notices: Xxxxxxx Xxxxx & Co.
00000 Xxxxxxxx Xxxx.
Xxxxx 0000
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Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Del Moral-Niles
Delivery Date: 10:00 A.M., New York City time, on January 27, 1999
Place of closing: Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
The Underwriters hereby confirm that they have furnished to the Company
in writing the following information for inclusion in the Company's Prospectus
Supplement dated January 22, 1999 to the Company's Prospectus dated June 23,
1997 relating to the Underwritten Securities (the "Prospectus Supplement"): (i)
the second and third sentences of the first paragraph on page S-7 of the
Prospectus Supplement; (ii) the table on page S-7 of the Prospectus Supplement,
(iii) the second paragraph below the table on page S-7 of the Prospectus
Supplement concerning the public offering price, concession and discount; (iv)
the third sentence of the third paragraph below the table on page S-7 of the
Prospectus Supplement; (v) the fourth and fifth paragraphs below the table on
page S-7 of the Prospectus Supplement concerning overallotment, stabilizing
transactions and syndicate covering transactions; and (vi) as it relates to the
Underwriters, the sixth paragraph below the table on page S-7 of the Prospectus
Supplement concerning the absence of any representation with respect to the
direction, magnitude and continuance of the transactions described therein.
All of the provisions contained in the document entitled "Aristar, Inc.
-- Debt Securities -- Underwriting Agreement Basic Provisions" and dated October
6, 1997 (the "Basic Provisions"), a copy of which you have previously furnished
to us, are herein incorporated by reference in their entirety and shall be
deemed to be a part of this Terms Agreement to the same extent as if such
provisions had been set forth in full herein; provided, however, that
(i) the Company also represents to the Underwriters
that, to the best of its knowledge, Deloitte & Touche, L.L.P. are
independent accountants as required by the Act and the Rules and the
Regulations;
(ii) the first sentence of clause (d) of Paragraph 1 of
such provisions shall be deleted and shall be replaced in its entirety
by the following: "From the dates as of which information is given in
the Registration Statement and the Prospectus, and except as described
therein, (i) there has not been any material adverse change or any
development involving a prospective material adverse change in the
financial condition or results of operations of the Company and its
Subsidiaries taken as a whole and (ii) there has been no dividend or
distribution of any kind declared, paid or made by the Company on any
class of its capital stock.";
(iii) subparagraph (ii) of the first proviso in clause
(a) of Paragraph 7 of such provisions shall be deleted and and shall be
replaced in its entirety by the following: "and (ii) that with respect
to any Preliminary Prospectus or Prospectus, the foregoing
indemnification shall not inure to the benefit of any Underwriter, any
Participant or any person controlling that Underwriter or Participant on
account of any loss, claim, damage, liability or action arising from the
purchase of Securities by any person from that
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Underwriter or Participant, if that Underwriter or Participant in fact
failed to send or give a copy of the Prospectus (excluding documents
incorporated by reference) provided by the Company in accordance with
Paragraph 6(b) hereof (as such Prospectus may then be amended or
supplemented, in each case exclusive of the documents incorporated
therein by reference) to that person within the time required by the
Act;";
(iv) subparagraph (iii) of the proviso in the third
sentence of clause (c) of Paragraph 7 of such provisions shall be
deleted and shall be replaced in its entirety by the following: "or
(iii) the indemnifying party has failed to assume the defense of such
claim or action and employ counsel reasonably satisfactory to the
indemnified party, in which case, if such indemnified party notifies the
indemnifying party in writing that it elects to employ separate counsel
at the expense of the indemnifying party, the indemnifying party shall
not have the right to assume the defense of such claim or action on
behalf of such indemnified party, it being understood, however, that the
indemnifying party shall not, in connection with any one such claim or
action or separate but substantially similar or related claims or
actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and
expenses of more than one separate firm of attorneys (in addition to
local counsel) at any time for all such indemnified parties, which firm
shall be designated in writing by the Representatives, if the
indemnified parties under this Paragraph consist of any Underwriter, any
Participant or any of their respective controlling persons, or by the
Company, if the indemnified parties under this Paragraph consist of the
Company of any of its directors, officers or controlling persons.";
(v) the following sentence in clause (c) of Paragraph 7
of such provisions shall be deleted in its entirety: "Each indemnified
party, as a condition of the indemnity agreements contained in Paragraph
7(a) and 7(b) hereof, shall use its best efforts to cooperate with the
indemnifying party in the defense of any such claim or action.";
(vi) the following sentence shall be inserted at the end
of clause (c) of Paragraph 7 of such provisions: "No indemnifying party
shall, without the prior written consent of the indemnified party (which
consent shall not be unreasonably withheld), 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.";
(vii) clause (a) of Paragraph 8 of such provisions shall
be deleted and shall be replaced in its entirety by the following: "(a)
trading in securities generally on the New York Stock Exchange is
suspended or minimum prices are established on that Exchange or trading
in any securities of the Company have been suspended by any exchange or
by the Commission";
(viii) clause (c) of Paragraph 8 of such provisions
shall be deleted and shall be replaced in its entirety by the following:
"(c) there is an outbreak or escalation of hostilities involving the
United States or the declaration by the United States of a national
emergency or war if the effect of any such event is to make it
impracticable to proceed with
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the public offering or the delivery of the Underwritten Securities on
the terms and in the manner contemplated in the Prospectus as first
amended or supplemented relating to the Underwritten Securities, or";
(ix) clause (d) of Paragraph 8 of such provisions shall
be deleted and shall be replaced in its entirety by the following: "(d)
there shall have occurred such a material adverse change in general
economic, political or financial conditions (or the effect of
international conditions on the financial markets in the United States
shall be such) as to make it, in the judgment of a majority in interest
of the several Underwriters, impracticable or inadvisable to proceed
with the public offering or delivery of the Underwritten Securities on
the terms and in the manner contemplated in the Prospectus, or (e) the
rating of any of the Company's debt securities shall have been lowered
by either Xxxxx'x Investors Services, Inc. or Standard & Poor's or
either of such rating agencies shall have publicly announced that it has
placed any of the Company's debt securities on what is commonly termed a
"watch list" for possible downgrading.";
(x) the obligations of the Underwriters described in
Paragraph 9 of the Basic Provisions shall also be subject to their
receipt on the Delivery Date of a letter from Deloitte & Touche L.L.P.
of the type described in Paragraph 9(g) of the Basic Provisions;
(xi) the first clause of Paragraph 9 of such provisions
shall be deleted and shall be replaced in its entirety by the following:
"The respective obligations of the Underwriters under this Agreement
with respect to the Underwritten Securities are subject to the accuracy,
on the date of the Terms Agreement and on the Delivery Date, of the
representations and warranties of the Company contained herein, to the
accuracy of the statements of the Company's officers made in any
certificate furnished pursuant to the provisions hereof, to the
performance and observance by the Company in all material respects of
all covenants and agreements contained herein, and to each of the
following additional terms and conditions applicable to the Underwritten
Securities:";
(xii) subparagraph (vii) in clause (c) of Paragraph 9 of
such provisions shall be deleted and shall be replaced in its entirety
by the following: "(vii) The Registration Statement, as of the time it
became effective, and the Prospectus, as of its issue date (except that,
in each case, no opinion need be expressed as to the financial
statements and schedules and other financial data contained or
incorporated by reference therein), complied as to form in all material
respects with the requirements of the Act and the Trust Indenture Act
and the rules and regulations of the Commission under said Acts, and the
documents incorporated by reference in the Prospectus, when filed with
the Commission (except that no opinion need be expressed as to the
financial statements and schedules and other financial data contained or
incorporated by reference therein), complied as to form in all material
respects with the applicable requirements of the Exchange Act and the
rules and regulations of the Commission thereunder; and (except that no
opinion need be expressed as to the financial statements and schedules
and other financial data contained or incorporated by reference therein)
nothing has come to the attention of such counsel to lead them to
believe that the Registration Statement, as of the time it became
effective, contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to
make the statements therein not misleading or that the Prospectus, as of
its date and as of the Delivery Date, contained any untrue statement of
a
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material fact or omitted 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.";
(xiii) Paragraph 14 of such provisions shall be deleted
and shall be replaced in its entirety by the following: "14. All
representations, warranties, indemnities, and agreements of the Company
contained in this Agreement, or contained in certificates of officers
submitted pursuant hereto, shall remain operative and in full force and
effect, regardless of the termination of this Agreement or any
investigation made by or on behalf of the Underwriters or any person
controlling the Underwriters or by or on behalf of the Company, and
shall survive each delivery of and payment for any of the Underwritten
Securities.";
and (xiv) clause (j) of Paragraph 9 of such provisions
shall be deleted and shall be replaced in its entirety by the following:
"(j) During the period from the date of the Terms Agreement to and
including the Delivery Date, there shall have occurred no material
adverse change and no development involving a prospective material
adverse change in the financial condition or results of operations of
the Company and its Subsidiaries taken as a whole."
Terms defined in such Underwriting Agreement Basic Provisions
are used herein as therein defined.
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Please accept this offer no later than 6:00 P.M., New York City
time, on January 22, 1999 by signing a copy of this Terms Agreement in the space
set forth below and returning the signed copy to us, or by sending us a written
acceptance in the following form:
"We hereby accept your offer, set forth in the Terms Agreement
dated January 22, 1999, to purchase the Underwritten Securities on the
terms set forth therein."
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED,
XXXXXXX, SACHS & CO.,
XXXXXXX XXXXX XXXXXX INC.
By: XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
BY /S/ Xxxx Xxxxxx
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(Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated)
Name: Xxxx Xxxxxx
Title: Managing Director
Accepted:
ARISTAR, INC.
By /s/ XXXXXXXX X. XXXXXXX
----------------------------------
Name: Xxxxxxxx X. Xxxxxxx
Title: Senior Vice President
