1
Exhibit 1
$200,000,000
PIONEER HI-BRED INTERNATIONAL, INC.
___% Senior Note due 2009
UNDERWRITING AGREEMENT
----------------------
January __, 1999
Lazard Freres & Co. LLC
Chase Securities Inc.
c/o Lazard Freres & Co. LLC
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
SECTION 1. INTRODUCTORY. Pioneer Hi-Bred International, Inc.,
an Iowa corporation (the "Company"), proposes to issue and sell to the several
Underwriters named in Schedule I hereto (the "Underwriters") an aggregate of
$200,000,000 principal amount of its ___% Senior Notes due 2009 (the
"Securities"). The Securities are to be issued pursuant to the provisions of an
Indenture, to be dated as of January __, 1999 (hereinafter called the
"Indenture"), between the Company and Chase Manhattan Trust Company, National
Association, as Trustee (the "Trustee"). The Company hereby agrees with the
Underwriters as follows:
SECTION 2. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE
COMPANY. The Company represents and warrants to, and agrees with, the several
Underwriters that:
(a) A registration statement on Form S-3 (No. 333-69285),
including a prospectus, relating to the Securities has been filed with
the
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Securities and Exchange Commission (the "Commission"). Such
registration statement either (i) is not proposed to be amended and has
been declared effective under the Securities Act of 1933, as amended
(the "Act"), and any post-effective amendments filed with the
Commission prior to the execution and delivery of this Agreement have
been declared effective or (ii) is proposed to be amended by amendment
or post-effective amendment. For purposes of this Agreement, "Effective
Time" means, in the case of clause (i) in the preceding sentence, the
date and time as of which such registration statement or the most
recent post-effective amendment thereto (if any) filed prior to the
execution and delivery of this Agreement was declared effective by the
Commission or, in the case of clause (ii) in the preceding sentence,
the date and time as of which such registration statement, as amended
by such amendment or post-effective amendment, as the case may be, is
declared effective by the Commission. "Effective Date" means the date
of the Effective Time. If the Effective Time is prior to the execution
and delivery of this Agreement, no other document relating to such
registration statement has been filed with the Commission; and no
proceeding for the purpose of suspending such effectiveness has been
initiated or threatened or, to the knowledge of the Company, is
contemplated by the Commission. Such registration statement as amended
at the Effective Time, including all material incorporated by reference
therein and all exhibits thereto and including all information (if any)
contained in a prospectus subsequently filed with the Commission and
deemed to be part of the registration statement at the Effective Time
pursuant to Rule 430A under the Act, is hereinafter referred to as the
"Registration Statement," and the prospectus, in the form first filed
pursuant to Rule 424(b) under the Act ("Rule 424(b)") or, if no such
filing is required, as included in the Registration Statement,
including all material incorporated by reference in such prospectus, is
hereinafter referred to as the "Prospectus." The terms "supplement" and
"amendment" or "amend" as used in this Agreement shall include all
documents subsequently filed by the Company with the Commission
pursuant to the Exchange Act that are incorporated by reference in the
Prospectus. (Any preliminary prospectus included in such Registration
Statement or filed with the Commission pursuant to Rule 424(a) under
the Act is hereinafter referred to as a "Preliminary Prospectus.")
(b) If the Effective Time is prior to the execution and
delivery of this Agreement: (i) on the Effective Date, the Registration
Statement conformed, on the date of this Agreement, the Registration
Statement conforms, and at the time of filing of the Prospectus
pursuant to Rule 424(b), the Registration Statement and the Prospectus
will conform in all
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respects to the requirements of the Act and the rules and regulations
of the Commission thereunder (the "Rules and Regulations") and the
Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"),
and the rules and regulations of the Commission thereunder (the "TIA
Rules and Regulations"), (ii) on the Effective Date, neither the
Registration Statement nor the Prospectus included any untrue statement
of a material fact or omitted to state any material fact required to be
stated therein or necessary to make the statements therein not
misleading, (iii) any amendment to the Registration Statement, as of
its date and as of its effective date, did not and will not include any
untrue statement of material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading and (iv) the Prospectus on the date of this
Agreement, as of its date, as of the date of any amendment or
supplement thereto, and as amended or supplemented at the Closing Date
(as defined in Section 3), does not and will not contain any untrue
statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. If the
Effective Time is subsequent to the execution and delivery of this
Agreement: (i) on the Effective Date, the Registration Statement and
the Prospectus will conform in all respects to the requirements of the
Act and the Rules and Regulations and the Trust indenture Act and the
TIA Rules and Regulations, and neither the Registration Statement nor
the Prospectus will include any untrue statement of a material fact or
will omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, (ii) any
amendment to the Registration Statement, as of its date and as of its
effective date, will not include any untrue statement of material fact
or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading and (iii) the
Prospectus, as of its date, as of the date of any amendment or
supplement thereto, and as amended or supplemented at the Closing Date,
will not contain any untrue statement of any material fact or omit to
state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading. The foregoing representations and warranties do not
apply to statements or omissions in the Registration Statement or any
amendment thereto or the Prospectus, as amended or supplemented, if
applicable, based upon the information furnished to the Company by you
specified in Section 8(a).
(c) The documents incorporated by reference in the Prospectus,
when they became effective or were filed with the Commission, as the
case may be, conformed in all respects to the requirements of the Act
and the
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Rules and Regulations or the Securities Exchange Act of 1934 (the
"Exchange Act") and the rules and regulations of the Commission
thereunder (the "Exchange Act Rules and Regulations"), as applicable,
and none of such documents when they became effective or were so filed,
as the case may be, contained any untrue statement of any material fact
or omitted to state any material fact required to be stated therein or
necessary to make the statements therein not misleading; and any
further documents so filed and incorporated by reference in the
Prospectus or any further amendment or supplement thereto, when such
documents become effective or are filed with the Commission, as the
case may be, will conform in all respects to the requirements of the
Act and the Rules and Regulations or the Exchange Act and the Exchange
Act Rules and Regulations, as applicable, and will not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading.
(d) No order preventing or suspending the use of any
Preliminary Prospectus has been issued by the Commission and no
proceedings for that purpose shall have been instituted or threatened
or, to the knowledge of the Company, contemplated by the Commission,
and each Preliminary Prospectus, at the time of filing thereof,
conformed in all respects to the requirements of the Act and the Rules
and Regulations and the Trust Indenture Act and the TIA Rules and
Regulations, and did not contain any untrue statement of a material
fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading; except that this representation and warranty
shall not apply to any statements or omissions made in reliance upon
and in conformity with the information furnished to the Company by you
specified in Section 8(a).
(e) The consolidated financial statements included in the
Registration Statement and Prospectus present fairly the consolidated
financial position of the Company and its consolidated subsidiaries as
of the dates indicated and the results of their operations and the
statements of their cash flows for the periods specified; such
financial statements have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis during the
periods involved, except as indicated therein; and the supporting
schedules included in the Registration Statement present fairly the
information required to be stated therein.
(f) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as
otherwise stated
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therein, (i) there has been no material adverse change in the
condition, financial or otherwise, earnings, business or prospects of
the Company and its subsidiaries considered as a whole, whether or not
arising in the ordinary course of business ("Material Adverse Effect"),
and (ii) there have been no material transactions entered into by the
Company or any of its subsidiaries other than those in the ordinary
course of business.
(g) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of Iowa with
power and authority to own, lease and operate its properties and
conduct its business as described in the Registration Statement and
Prospectus; and the Company is duly qualified as a foreign corporation
to transact business and is in good standing in each jurisdiction in
which it owns or leases properties or in which the conduct of its
business 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.
(h) Each of the subsidiaries of the Company has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has power and
authority to own, lease and operate its properties and conduct its
business as described in the Registration Statement and Prospectus and
is duly qualified as a foreign corporation to transact business and is
in good standing in each jurisdiction in which it owns or leases
properties or in which the conduct of its business 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 considered as a whole; all of the issued
and outstanding capital stock of each subsidiary has been duly
authorized and validly issued and is fully paid and non-assessable, and
(except as set forth in the Company's Report on Form 10-K for the 1998
fiscal year), all such capital stock of each subsidiary is owned,
directly or through subsidiaries, by the Company, free and clear of any
mortgage, pledge, lien, encumbrance, adverse claim or equity.
(i) Neither the Company nor any of its subsidiaries is in
violation of its or any of their charters or bylaws or other
organizational documents or in default in the performance or observance
of any obligation, agreement, covenant or condition contained in any
material contract, indenture, mortgage, loan agreement, note, lease or
other agreement or instrument to which it or any of them is a party or
by which it or any of them or their properties may be bound; no
consent, approval, authorization, order, registration, filing or
qualification of or with any court or governmental
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authority or agency is required for the issue and sale of the
Securities as contemplated herein and in the Indenture or the
consummation by the Company of the transactions contemplated by this
Agreement and the Indenture, except such as may be required under the
Act and the Rules and Regulations, the Trust Indenture Act and the TIA
Rules and Regulations or state securities or Blue Sky laws in
connection with the distribution of the Securities by the Underwriters;
and the issue and sale of the Securities as contemplated herein and in
the Indenture, the execution and delivery of this Agreement and the
Indenture and the consummation of the transactions contemplated herein
and therein will not conflict with or constitute a breach of, or
default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any
of its subsidiaries pursuant to, any contract, indenture, mortgage,
loan agreement, note, lease or other agreement or instrument to which
the Company or any of its subsidiaries is a party or by which it or any
of them may be bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, nor will any such action
result in any violation of, or constitute a "change of control" under
the provisions of the charter or by-laws of the Company or any law,
administrative regulation or administrative or court decree or order
applicable to the Company or any of its subsidiaries.
(j) The Company and its subsidiaries possess all certificates,
authorities or permits issued by the appropriate state, federal or
foreign regulatory agencies or bodies necessary to conduct in all
material respects the business now operated by them, and neither the
Company nor any of its subsidiaries has received any notice of
proceedings relating to the revocation or modification of any such
certificate, authority or permit which, individually or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would have a Material Adverse Effect.
(k) Except as set forth in the Prospectus, as amended or
supplemented, there is no action, suit or proceeding before or by any
court or governmental agency or body, domestic or foreign, now pending,
or, to the knowledge of the Company, contemplated or threatened against
the Company or any of its subsidiaries, which is reasonably likely to
have a Material Adverse Effect, or is reasonably likely to
materially and adversely affect the properties or assets thereof or
which might adversely affect the offering of the Securities in the
manner contemplated by the Prospectus; and there are no material
contracts or other documents which are required to be described in the
Registration Statement or the Prospectus or filed as exhibits to the
Registration Statement by the Act or by the Rules and Regulations or
by the Trust Indenture Act or the
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TIA Rules and Regulations which have not been so described or have not
been so filed.
(l) Each of the Company and its subsidiaries has good and
marketable title in fee simple to all real property and good and
marketable title to all personal property owned by it, in each case
free and clear of all liens, encumbrances and defects except (i) such
as are referred to in the Prospectus or (ii) such as do not materially
and adversely affect the value of such property to the Company or such
subsidiary, and do not materially interfere with the use made and
proposed to be made of such property by the Company or such subsidiary;
and any real property and buildings held under lease by the Company and
its subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as are not material and do not
interfere with the use made and proposed to be made by the Company and
its subsidiaries.
(m) The Company has an authorized capitalization as set forth
in the Prospectus, and the shares of capital stock of the Company
outstanding prior to the issuance of the Securities have been duly
authorized, are validly issued, fully paid and non-assessable.
(n) This Agreement has been duly authorized, executed and
delivered by the Company.
(o) The indenture, which will be substantially in the form
filed as an exhibit to the Registration Statement, has been duly
authorized and duly qualified under the Trust Indenture Act and when
executed and delivered by the Company and the Trustee, the Indenture
will have been duly authorized, executed and delivered by the Company
and will constitute a valid and legally binding agreement of the
Company, enforceable in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and other laws
of general applicability relating to or affecting creditors' rights and
to general equity principles; and the Indenture will conform to the
description thereof in the Prospectus.
(p) The Securities have been duly authorized and, when
executed and authenticated in accordance with the terms of the
Indenture and issued and delivered in accordance with the terms of this
Agreement, will have been duly authorized, executed, authenticated,
issued and delivered by the Company, will constitute valid and binding
obligations of the Company, enforceable in accordance with their terms,
subject, as to enforcement, to bankruptcy, insolvency, reorganization
and other laws of general
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applicability relating to or affecting creditors' rights and to general
equity principles, will conform to the description thereof contained in
the Prospectus, will be substantially in the form filed as an exhibit
to the Registration Statement, and will be entitled to the benefits of
the Indenture.
(q) KPMG Peat Marwick LLP who have certified certain financial
statements of the Company and its subsidiaries, are independent public
accountants as required by the Act and the Rules and Regulations.
(r) Except as otherwise disclosed in the Prospectus, the
Company and its subsidiaries own or possess sufficient trademarks,
trade names, patent rights, copyrights, licenses, approvals, trade
secrets and other similar rights (collectively, "Intellectual Property
Rights") reasonably necessary to conduct their businesses as now
conducted; and the expected expiration of any of such Intellectual
Property Rights will not have a Material Adverse Effect. Neither the
Company nor any of its subsidiaries has received any notice of
infringement or conflict with asserted Intellectual Property Rights of
others, which infringement or conflict is reasonably likely to have a
Material Adverse Effect.
(s) The Company and each subsidiary possess such valid and
current certificates, authorizations or permits issued by the
appropriate state, federal or foreign regulatory agencies or bodies
necessary to conduct their respective businesses, as presently
conducted, and neither the Company nor any subsidiary has received any
notice of proceedings relating to the revocation or modification of, or
non-compliance with, 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.
(t) All disclosure regarding year 2000 compliance and the Euro
conversion that is required to be described in a registration statement
on Form S-3 under the 1933 Act (including disclosures required by Staff
Legal Bulletin Xx. 0, XXX Xxxxxxx Xx. 00-0000 (July 29, 1998) and SEC
Release No. 33-7609 (November 9, 1998)) has been included in the
Prospectus. Neither the Company nor any of its subsidiaries will incur
significant operating expenses or costs to ensure that its information
systems will be year 2000 compliant or to adjust its operating and
information systems to the conversion to a single currency in Europe,
other than as disclosed in the Prospectus.
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(u) Except such matters as would not, singly or in the
aggregate, materially affect the Company and its subsidiaries, (A) none
of the Company and its subsidiaries is in violation of any federal,
state, local or foreign statute, law, rule, regulation, ordinance,
code, policy or rule of common law or any judicial or administrative
interpretation thereof, including any judicial or administrative order,
consent, decree or judgment, relating to pollution or protection of
human health, the environment (including, without limitation, ambient
air, surface water, groundwater, land surface or subsurface strata) or
wildlife, including, without limitation, laws and regulations relating
to the release or threatened release of chemicals, pollutants,
contaminants, wastes, toxic substances, hazardous substances, petroleum
or petroleum products or nuclear or radioactive material (collectively,
"Hazardous Materials") or to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of Hazardous
Materials (collectively, "Environmental Laws"), (B) the Company and its
subsidiaries have all permits, licenses, authorizations and approvals
currently required for their respective businesses under any applicable
Environmental Laws and are each in compliance with their requirements,
(C) there are no pending or threatened administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens,
notices of noncompliance or violation, investigation or proceedings
relating to any Environmental Law against the Company or any of its
subsidiaries and (D) there are no events, facts or circumstances that
might reasonably be expected to form the basis of any liability or
obligation of the Company or its subsidiaries, including, without
limitation, any order, decree, plan or agreement requiring clean-up or
remediation, or any action, suit or proceeding by any private party or
governmental body or agency, against or affecting the Company or any of
its subsidiaries relating to any Hazardous Materials or Environmental
Laws.
(v) The Company is not, and upon the issuance and sale of the
Securities as herein contemplated and the application of the net
proceeds therefrom as described in the Prospectus will be, an
"investment company" or an entity "controlled" by an "investment
company" as such terms are defined in the Investment Company Act of
1940, as amended (the "1940 Act").
SECTION 3. PURCHASE, SALE AND DELIVERY OF SECURITIES. On the
basis of the representations, warranties and agreements herein contained, but
subject to the terms and conditions herein set forth, the Company hereby agrees
to issue and sell to the Underwriters, and each Underwriter agrees, severally
and not jointly, to purchase from the Company the Securities at __% of their
principal
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amount, plus accrued interest, if any, to the Closing Date (as defined below)
hereunder.
The Securities to be purchased by each Underwriter hereunder,
in definitive form, and in such authorized denominations and registered in such
names as Lazard Freres & Co. LLC may request upon at least forty-eight hours'
prior notice to the Company, shall be delivered by or on behalf of the Company
to you for the account of such Underwriter, against payment by such Underwriter
or on its behalf of the purchase price therefor by wire transfer in immediately
available funds to the account specified by the Company, all at the office of
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx, New York, New York, at 9:30 a.m., New
York City time, on January __ 1999 or at such other time and date as you and the
Company may agree upon in writing, such time and date being herein called the
"Closing Date". Certificates representing the Securities will be made available
for checking and packaging at least twenty-four hours prior to the Closing Date
at the office of the Trustee.
SECTION 4. OFFERING BY UNDERWRITERS. After the Registration
Statement becomes effective the several Underwriters will offer the Securities
for sale to the public on the terms and conditions as set forth in the
Prospectus.
SECTION 5. COVENANTS OF THE COMPANY. The Company covenants and
agrees with the several Underwriters that:
(a) If the Effective Time is prior to the execution and
delivery of this Agreement, the Company will file the Prospectus with
the Commission pursuant to and in accordance with subparagraph (1) (or,
if applicable, and with your consent, subparagraph (4)) of Rule 424(b)
not later than the second business day following the earlier of (i) the
date of execution and delivery of this Agreement or (ii) the date a
Prospectus is first used after the Effective Date. The Company will
advise you promptly of any proposal to amend or supplement the
Registration Statement as filed, or the related Prospectus, prior to
the Closing Date, and will not effect such amendment or supplement
without your consent; the Company will also advise you promptly of the
effectiveness of the Registration Statement (if the Effective Time is
subsequent to the execution and delivery of this Agreement), of any
amendment or supplement to the Registration Statement or the
Prospectus, and of receipt of notification of the institution by the
Commission of any stop order proceedings in respect of the Registration
Statement or of any order preventing or suspending the use of any
Preliminary Prospectus or any prospectus relating to the Securities, of
the suspension of the qualification of the Securities for offering or
sale in any jurisdiction or the
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initiation or threatening of any proceeding for such purpose, or of any
request by the Commission to amend or supplement the Registration
Statement or Prospectus or for additional information and will use its
best efforts to prevent the issuance of any such stop order or of any
order preventing or suspending the use of any Preliminary Prospectus or
any prospectus relating to the securities or suspending any such
qualification and to obtain as soon as possible its lifting, if issued.
(b) If, at any time when a prospectus relating to the
Securities is required to be delivered under the Act, any event occurs
as a result of which the Prospectus as then amended or supplemented
would, in the judgment of the Underwriters, include an untrue statement
of a material fact, or omit to state a material fact necessary to make
the statements therein, in the light of the circumstances under which
they were made, not misleading, or if it is necessary at any time to
amend or supplement the Prospectus to comply with the Act, the Exchange
Act, the Trust Indenture Act or any other law, the Company promptly
will prepare and file, subject to Section 5(a) of the Act, with the
Commission an amendment or supplement which will correct such statement
or omission or an amendment which will effect such compliance and will
notify you and, upon your request prepare and furnish without charge to
each Underwriter and to any dealer in securities as many copies as you
may from time to time reasonably request, of an amended Prospectus or a
supplement to the Prospectus complying with Section 10(a) of the Act
which will correct such statement or omission or effect such
compliance.
(c) The Company will make generally available to the Company's
security holders as soon as practicable an earning statement covering
the twelve-month period ending February 29, 2000 that satisfies the
provisions of Section 11(a) of the Act and the Rules and Regulations
(including Rule 158).
(d) The Company will deliver to each of you as many signed and
conformed copies of the Registration Statement (as originally filed)
and of each amendment thereto (including exhibits filed therewith and
documents incorporated therein by reference as you may reasonably
request and will also deliver to you a conformed copy of the
Registration Statement and each amendment thereto for each of the
Underwriters (including documents incorporated therein by reference).
(e) The Company will take such action as you may reasonably
request, in cooperation with you, to qualify the Securities for
offering and
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sale under the applicable securities laws of such states and other
jurisdictions of the United States as you may designate, and will
maintain such qualifications in effect for as long as may be required
for the distribution of the Securities. The Company will file such
statements and reports as may be required by the laws of each
jurisdiction in which the Securities have been qualified as above
provided.
(f) During the period of five years hereafter, the Company
will furnish to you and, upon request, to each of the other
Underwriters, as soon as practicable after the end of each fiscal year,
a copy of its annual report to stockholders for such year, and the
Company will furnish to you (i) as soon as available, a copy of each
report or definitive proxy statement of the Company filed with the
Commission under the Securities Exchange Act of 1934 (the "Exchange
Act") or mailed to stockholders and (ii) from time to time, such other
information concerning the Company as you may reasonably request.
(g) During the period beginning from the date hereof and
continuing to and including the later of (i) the termination of trading
restrictions on the Securities, as notified to the Company by you, and
(ii) the Closing Date, not to offer, sell, contract to sell or
otherwise dispose of any debt securities of the Company which mature
more than one year after the Closing Date, without your prior written
consent.
(h) The Company, during the period when the prospectus
relating to the Securities is required to be delivered under the Act,
will file promptly all documents required to be filed with the
Commission pursuant to Section 13, 14 or 15 of the Exchange Act.
(i) The Company shall use its reasonable best efforts to list
the Securities on the New York Stock Exchange.
SECTION 6. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS.
The obligations of the several Underwriters to purchase and pay for the
Securities on the Closing Date will be subject to the accuracy of the
representations and warranties on the part of the Company herein as of the date
hereof and as of the Closing Date with the same force and effect as if made as
of that date, to the performance by the Company of its obligations hereunder and
to the following additional conditions precedent:
(a) If the Effective Time is not prior to the execution and
delivery of this Agreement, the Effective Time shall have occurred not
later than 5:00 P.M., New York time, on the date of this Agreement, or
such later time
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or date as shall have been consented to by you. If the Effective Time
is prior to the execution and delivery of this Agreement, the Company
shall have filed the Prospectus with the Commission pursuant to Rule
424(b) within the applicable time period prescribed for such filing by
the Rules and Regulations and in accordance with Section 5(a) hereof.
In either case, prior to the Closing Date no stop order suspending the
effectiveness of the Registration Statement shall have been issued and
no proceedings for that purpose shall have been instituted or
threatened, or to the knowledge of the Company or you, shall be
contemplated by the Commission; and the Company shall have complied
with all requests for additional information on the part of the
Commission to your reasonable satisfaction.
(b) You shall not have advised the Company that the
Registration Statement or Prospectus, or any amendment or supplement
thereto, contains any untrue statement of fact or omits to state any
fact which, you have concluded, is material and in the case of an
omission is required to be stated therein or is necessary to make the
statements therein not misleading.
(c) You shall have received favorable opinions of Xxxx X.
Xxxxxxx, Vice President and General Counsel for the Company and Xxxxx &
Xxxxxxxxx LLP, special counsel for the Company, in a form agreed
between Xx. Xxxxxxx and Xxxxx & Xxxxxxxxx LLP and the Underwriters,
dated the Closing Date, to the effect that:
(i) The Company has been duly organized and is
validly existing as a corporation in good standing under the
laws of Iowa with corporate power and authority to own, lease
and operate its properties and conduct its business as
described in the Registration Statement and the Prospectus;
and the Company is duly qualified to transact business and is
in good standing in each jurisdiction in which it owns or
leases property or in which the conduct of its business
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.
(ii) Each of the subsidiaries of the Company has been
duly incorporated and is validly existing as a corporation in
good standing under the laws of the jurisdiction of its
incorporation, has corporate power and authority to own, lease
and operate its properties and conduct its business as
described in the Registration Statement and the Prospectus,
and is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in
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which it owns or leases properties or in which the conduct of
its business 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; all of the issued
and outstanding capital stock of each subsidiary has been duly
authorized and validly issued and is fully paid and
non-assessable, and except as set forth in the Company's
Annual Report on Form 10-K for the 1998 fiscal year, all of
such capital stock, is owned by the Company free and clear of
any pledge, lien, encumbrance, adverse claim or equity.
(iii) This Agreement has been duly authorized,
executed and delivered by the Company.
(iv) The Securities have been duly and validly
authorized, executed, authenticated, issued and delivered and
constitute valid and binding obligations of the Company,
enforceable in accordance with their terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and
other laws of general applicability relating to or affecting
creditors' rights and to general equity principles, conform in
all material respects to the description thereof in the
Prospectus and are entitled to the benefits of the Indenture;
(v) The Indenture has been duly authorized, executed
and delivered by the Company and constitutes a valid and
legally binding agreement of the Company, enforceable in
accordance with its terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization and other laws of
general applicability relating to or affecting creditors'
rights and to general equity principles, conforms in all
material respects to the description thereof in the
Prospectus, and has been duly qualified under the Trust
Indenture Act.
(vi) The Registration Statement is effective under
the Act and, to the best of their knowledge and information,
no stop order suspending the effectiveness of the Registration
Statement or any part thereof has been issued under the Act or
proceedings therefor initiated or threatened or are pending or
contemplated by the Commission.
(vii) Statements set forth in the Prospectus under
the headings "Description of the Notes" and "Underwriting" and
in the Registration Statement under Item 15 insofar as such
statements constitute a summary of the legal matters,
documents or proceedings
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referred to therein fairly present the information called for
with respect to such legal matters, documents and proceedings.
(viii) No consent, approval, authorization, order,
filing, registration or qualification of or with any court or
governmental authority or agency is required for the issue and
sale of the Securities or the consummation of the transactions
contemplated by this Agreement, except such as may be required
and have been obtained under the Act and the Rules and
Regulations and the Trust Indenture Act and the TIA Rules and
Regulations and such as may be required under state securities
or Blue Sky laws in connection with the distribution of the
Securities by the Underwriters; and, the issue and sale of the
Securities, the execution and delivery of this Agreement and
the consummation of the transactions contemplated herein will
constitute a breach of, or default under, or result in the
creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any of its
subsidiaries pursuant to, any material contract, indenture,
mortgage, loan agreement, note, lease or other instrument or
agreement known to such counsel to which the Company or any of
its subsidiaries is a party or by which it or any of them may
be bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, nor will such
action result in any violation of the provisions of the
charter or by-laws of the Company, or any law or
administrative regulation or, to such counsel's knowledge,
administrative or court decree or order, applicable to the
Company or any of its subsidiaries.
(ix) After due inquiry, such counsel does not know of
(x) any legal or governmental action, suit or proceeding
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 subsidiary is subject which is reasonably
likely, individually or in the aggregate, to have a Material
Adverse Effect, or to adversely affect the offering of the
Securities or that is required to be described in the
Registration Statement or the Prospectus and is not so
described or (y) of any material contract or other document
that is required to be described in the Registration Statement
or the Prospectus or to be filed as an exhibit to the
Registration Statement that is not so described or filed as
required.
(x) Such counsel (1) (a) is of the opinion that each
document incorporated by reference in the Registration
Statement
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and the Prospectus (other than the financial statements, as to
which no opinion need be rendered) complied as to form when
filed with the Commission in all material respects with the
Exchange Act and the Exchange Act Rules and Regulations and
(b) has no reason to believe that any such document contained
any untrue statement of a material fact or omitted to state
any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they
were made, not misleading, (2) is of the opinion that the
Registration Statement, as of the Effective Date, any
amendment to the Registration Statement, as of its date or as
of its effective date, and the Prospectus, as of the Effective
Date and as of its date (other than the financial statements
included therein, as to which no opinion need be expressed)
complies as to form in all material respects with the
requirements of the Act and the Rules and Regulations and the
Trust Indenture Act and the TIA Rules and Regulations, and (3)
has no reason to believe that (other than the financial
statements included therein, as to which no belief need be
expressed) the Registration Statement, as of the Effective
Date, any amendment to the Registration Statement, as of its
date or as of its effective date, and the Prospectus, as of
the Effective Date, contained any untrue statement of a
material fact or omitted to state any material fact required
to be stated therein or necessary to make the statements
therein not misleading and that the Prospectus, as of its
date, as of the date of any amendment or supplement thereto,
and as amended or supplemented at the Closing Date, contained
or contains any untrue statement of a material fact or omitted
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.
(d) You shall have received from Fried, Frank, Harris, Xxxxxxx
& Jacboson, counsel for the Underwriters, opinions, dated the Closing
Date, with respect to such matters as you may reasonably request.
(e) You shall have received from the President or any Senior
Vice President and a principal financial or accounting officer of the
Company a certificate, dated the Closing Date, in which such officers,
to the best of their knowledge and after reasonable investigation,
shall state that there has not been, since the respective dates as of
which information is given in the Registration Statement and the
Prospectus, (i) a Material Adverse Effect or (ii) any material
transactions entered into by the Company or any of its subsidiaries
other than those in the ordinary course
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of business, except in the case of clause (i) and clause (ii) as set
forth in or contemplated by the Prospectus; the representations and
warranties of the Company contained in Section 2 are true and correct
with the same force and effect as though made on and as of the Closing
Date and the Company has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied hereunder at or
prior to the Closing Date; and no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been initiated or threatened or are
contemplated by the Commission.
(f) You shall have received from KPMG Peat Marwick LLP
independent public accountants, two letters, the first dated the date
of this Agreement and the other dated such Closing Date, addressed to
the Underwriters (with conformed copies for each of the Underwriters),
substantially in the form of Annex I hereto with such variations as are
reasonably acceptable to you.
(g) At the Closing Date counsel for the Underwriters shall
have been furnished with such other documents and opinions as they may
reasonably require.
SECTION 7. PAYMENT OF EXPENSES. The Company will pay all
costs, expenses, fees, disbursements and taxes incident to (i) the preparation
by the Company, printing, filing and distribution of the Registration Statement
(including financial statements and exhibits), the Prospectus, each Preliminary
Prospectus and all amendments and supplements to any of them prior to or during
the period specified in Section 5(b), (ii) the preparation, printing (including
word processing and duplication costs) and delivery of any Agreement Among
Underwriters, this Agreement, the Indenture, Preliminary and Supplemental Blue
Sky Memoranda, Legal investment Survey and all other agreements, memoranda,
correspondence and other documents printed and delivered in connection with the
offering of the Securities, (iii) the registration with the Commission, and the
issuance by the Company, of the Securities, (iv) the registration or
qualification of the Securities for offer and sale under the securities or Blue
Sky laws of the several states (including the reasonable fees and disbursements
of your counsel relating to such registration or qualification), (v) fees and
expenses, if any, incurred in connection with the listing of the Securities on
any stock exchange, (vi) filings and clearance with the National Association of
Securities Dealers, Inc. in connection with the offering, (vii) any fees charged
by securities rating services for rating the Securities, (viii) the fees and
expenses of the Trustee and any agent of the Trustee and the fees and
disbursements of counsel for the Trustee in connection with the Indenture and
the securities and (x) the performance by the
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Company of its other obligations under this Agreement, and all other costs and
expenses incident to the performance of its obligations hereunder which are not
specifically provided for in this Section 7.
If the sale of the Securities provided for herein is not
consummated because any condition to the obligations of the Underwriters set
forth in Section 6 hereof is not satisfied, because of any termination pursuant
to Section 10 hereof or because of any refusal, failure or inability of the
Company to perform any agreement herein or comply with any provision hereof
other than by reason of a default by any Underwriter, the Company shall
reimburse you for all of your reasonable out-of-pocket expenses incurred in
connection with marketing and preparing for the offering of the Securities,
including the reasonable fees and disbursements of counsel for the Underwriters,
but the Company shall be under no further liability to any Underwriter except as
provided in Section 8 hereof.
SECTION 8. INDEMNIFICATION 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 Act or Section 20 of the
Exchange Act, from and against any and all losses, claims, damages and
liabilities (or actions in respect thereof) (including, without
limiting the foregoing, the reasonable legal and other expenses
incurred in connection with investigating or defending any action, suit
or proceeding or any claim asserted, as such expenses are incurred)
arising out of or based on any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or
the Prospectus or any Preliminary Prospectus or any other prospectus
with respect to the Securities, 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, liabilities or expenses are
caused by any such untrue statement or omission or alleged untrue
statement or omission based upon the following information furnished to
the Company by you in (i) the seventh paragraph under the table of the
Underwriters under the caption "Underwriting" in the Prospectus
concerning stabilization by the Underwriters, (ii) the second sentence
of the fourth paragraph of text under the table of the Underwriters
under the caption "Underwriting" in the Prospectus relating to market
making by the representatives and (iii) the second and third sentences
of the second paragraph under the table of the Underwriters under the
caption "Underwriting" in the Prospectus concerning the terms of the
offering by the Underwriters. This indemnity agreement will be in
addition to any
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liability which the Company may otherwise have to the persons referred
to above in this Section 8(a).
(b) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company, the directors of the Company,
the officers of the Company who sign the Registration Statement and
each person, if any, who controls the Company within the meaning of
either Section 15 of the Act or Section 20 of the Exchange Act from and
against any and all losses, claims, damages and liabilities (or actions
in respect thereof) caused by any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or
the Prospectus or any Preliminary Prospectus, 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, but only with reference to the information furnished to the
Company by such Underwriter set forth in the first sentence of Section
8(a). This indemnity agreement will be in addition to any liability
which the Underwriters may otherwise have to the persons referred to
above in this Section 8(b).
(c) In case any action or proceeding (including any
governmental or regulatory investigation or proceeding) shall be
instituted involving any person in respect of which indemnity may be
sought pursuant to any of the two preceding paragraphs, such person
(hereinafter called the indemnified party) shall promptly notify the
person against whom such indemnity may be sought (hereinafter called
the indemnifying party) in writing; however, the omission to so notify
the indemnifying party shall relieve the indemnifying party from
liability under the two preceding paragraphs only to the extent the
indemnifying party is materially prejudiced thereby. The indemnifying
party, upon request of the indemnified party, shall assume the defense
thereof, including the employment of counsel reasonably satisfactory
to the indemnified party to represent the indemnified party and any
others that the indemnifying party may designate and shall pay the fees
and disbursements of such counsel related to such proceeding. In any
such action or 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, (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 or (iii) the indemnifying
party fails to appoint counsel reasonably satisfactory
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to the indemnified party within a reasonable time after receiving
notice of the commencement of the action. It is understood that the
indemnifying party shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for (a) the
reasonable fees and expenses of more than one separate firm (in
addition to any local counsel) for all Underwriters and all persons, if
any, who control Underwriters within the meaning of either Section 15
of the Act or Section 20 of the Exchange Act, and (b) the reasonable
fees and expenses of more than one separate firm (in addition to any
local counsel) for 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 such Section, and that all such
fees and expenses shall be reimbursed as they are incurred. In the case
of any such separate firm for the Underwriters and such control persons
of Underwriters, such firm shall be designated in writing by Lazard
Freres & Co. LLC In the case of any such separate firm for the Company,
and such directors, officers and control persons of the Company, such
firm shall be designated in writing by the Company.
(d) If the indemnification provided for in this Section 8 is
insufficient or unavailable to an indemnified party in respect of any
losses, claims, damages or liabilities (or actions in respect thereof)
referred to therein, then each indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses,
claims, damages, liabilities and expenses (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 from the offering of the
Securities or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law or if the indemnified party shall have
failed to the material prejudice of the indemnifying party to give the
notice required by Section 8(c), in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and
the Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages, liabilities
or expenses, 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 shall be deemed to be in the same proportions
as the total net proceeds from the offering (before deducting expenses)
received by the Company bear to the total underwriting discounts and
commissions received by the Underwriters, in each case as set forth in
the table on the cover page of the Prospectus. The relative fault of
the Company on the one hand and the Underwriters on the other shall be
determined by reference to, among other things, whether
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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.
(e) The Company and the Underwriters agree that it would not
be just and equitable if contribution pursuant to Section 8(d) were
determined by PRO RATA allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations
referred to in the immediately preceding paragraph. The amount paid or
payable by an indemnified party as a result of the losses, claims,
damages or liabilities (or actions in respect thereof) referred to in
the immediately preceding paragraph shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of Section 8(d), in no event shall any
Underwriter be required to contribute any amount in excess of the
amount by which the total price at which the Securities underwritten by
it and distributed to the public were offered to the public exceeds the
amount of any damages which such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The Underwriters' obligations to
contribute pursuant to Section 8(d) are several in proportion to the
respective principal amounts of Securities set forth opposite their
names in Schedule I hereto and not joint.
SECTION 9. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO
SURVIVE DELIVERY. All representations, warranties and agreements contained in
the Agreement, or contained in certificates of officers of the Company submitted
hereto, including indemnity and contribution agreements, shall remain operative
and in full force and effect, regardless of any termination of this Agreement,
or any investigation, or any statement as to the results thereof, 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 controlling persons, and
shall survive acceptance of and payment for Securities hereunder.
If this Agreement is terminated pursuant to Section 10 or if
for any reason the purchase of Securities by the Underwriters is not
consummated, the Company shall remain responsible for the expenses to be paid or
reimbursed by it
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pursuant to Section 7 and the respective obligations of the Company and the
Underwriters pursuant to Section 8 shall remain in effect.
Anything herein to the contrary notwithstanding, the indemnity
agreement of the Company in subsection (a) of Section 8 hereof, the
representations and warranties in subsections (b) and (c) of Section 2 and any
representation or warranty as to the accuracy of the Registration Statement or
the Prospectus contained in any certificate furnished by the Company pursuant to
Section 6 hereof, insofar as they may constitute a basis for indemnification for
liabilities (other than payment by the Company of expenses incurred or paid in
the successful defense of any action, suit or proceeding) arising under the Act,
shall not extend to the extent of any interest therein of a controlling person
or partner of any Underwriter who is a director, officer or controlling person
of the Company when the Registration Statement has become effective or who, with
his consent, is named in the Registration Statement as about to become a
director of the Company, except in each case to the extent that an interest of
such character shall have been determined by a court of appropriate jurisdiction
as not against public policy as expressed in the Act. Unless in the opinion of
counsel for the Company the matter has been settled by controlling precedent,
the Company will, if a claim for such indemnification is asserted, submit to a
court of appropriate jurisdiction the question whether such interest is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
SECTION 10. TERMINATION. This Agreement may be terminated for
any reason at any time prior to the delivery and payment of the Securities on
the Closing Date by Lazard Freres & Co. LLC upon the giving of written notice of
such termination to the Company, if prior to such time (i) there has been, since
the respective dates as of which information is given in the Registration
Statement and the Prospectus, (A) any Material Adverse Effect or (B) any
material transaction entered into by the Company or any subsidiary other than in
the ordinary course of business, or (ii) there has occurred any outbreak or
escalation of hostilities or other calamity or crisis or material change in
existing national or international financial, political, economic or securities
market conditions, the effect of which is such as to make it, in the judgment of
Lazard Freres & Co. LLC, impracticable or inadvisable to market the Securities
in the manner contemplated in the Prospectus or enforce contracts for the sale
of the Securities, or (iii) reporting of bid and asked prices of the Common
Stock of the Company has been suspended by the National Association of
Securities Dealers, Inc., or trading in the Common Stock of the Company has been
suspended by the Commission or a national securities exchange, or trading
generally on either the American Stock Exchange or the New York Stock Exchange
has been suspended, or minimum or maximum prices for trading have been fixed, or
maximum ranges
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for prices for securities have been required, by either of said exchanges or by
order of the Commission or any other governmental authority, or if a banking
moratorium has been declared by either Federal or New York authorities or (iv)
any downgrading shall have occurred in the rating accorded any of the Company's
debt securities by any "nationally recognized statistical rating organization,
as that term is defined by the Commission for purposes of Rule 436(g)(2) under
the Act or any organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating of any
of the Company's debt securities. In the event of any such termination, the
provisions of Section 7, the indemnity agreement and contribution provisions set
forth in Section 8, and the provisions of Sections 9 and 14 shall remain in
effect.
SECTION 11. DEFAULT. If, on the Closing Date any one or more
of the Underwriters shall fail or refuse to purchase Securities that it or they
have agreed to purchase hereunder on such date, and the aggregate principal
amount of Securities which such defaulting Underwriter or Underwriters agreed
but failed or refused to purchase is not more than one-tenth of the aggregate
principal amount of the Securities to be purchased on such date, the other
Underwriters shall be obligated severally in the proportions that the principal
amount of Securities set forth opposite their respective names in Schedule I
bears to the aggregate principal amount of Securities set forth opposite the
names of all such non-defaulting Underwriters, or in such other proportions as
you may specify, to purchase the Securities which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase on such date; PROVIDED
that in no event shall the principal amount of Securities that any Underwriter
has agreed to purchase pursuant to Section 3 be increased pursuant to this
Section 11 by an amount in excess of one-ninth of such principal amount of
Securities without the written consent of such Underwriter. If, on the Closing
Date any Underwriter or Underwriters shall fail or refuse to purchase Securities
and the aggregate principal amount of Securities with respect to which such
default occurs is more than one-tenth of the aggregate principal amount of
Securities to be purchased on such date, and arrangements satisfactory to you
and the Company for the purchase of such Securities 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 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. 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.
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SECTION 12. NOTICES. All notices and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
mailed or transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to you c/o Lazard Freres & Co. LLC, Xxx
Xxxxxxxxxxx Xxxxx, Xxx Xxxx, XX 00000, Attention: Syndicate Department; and
notices to the Company shall be directed to it at Pioneer Hi-Bred International,
Inc., 000 Xxxxxxx Xxxxxx, X.X. Xxx 00000, Xxx Xxxxxx, XX 00000-0000, telephone
no. (000) 000-0000, facsimile transmission no. (000) 000-0000, attention of the
Secretary with copy to the Treasurer.
SECTION 13. PARTIES. This Agreement shall inure to the benefit
of and be binding upon the Company, its directors and officers who signed the
Registration Statement, the Underwriters, any controlling persons referred to
herein and their respective successors and assigns. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any other
person, firm or corporation any legal or equitable right, remedy or claim under
or in respect of this Agreement or any provision herein contained. No purchaser
of Securities from any Underwriter shall be deemed to be a successor by reason
merely of such purchase.
SECTION 14. GOVERNING LAW. This Agreement shall be governed
by, and construed in accordance with, the law of the State of New York.
SECTION 15. COUNTERPARTS. This Agreement may be executed 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.
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If the foregoing is in accordance with your understanding of
our agreement, please sign this Agreement and return to us counterparts hereof.
Very truly yours,
PIONEER HI-BRED INTERNATIONAL, INC.
By
---------------------------
Name:
Title:
Confirmed and Accepted, as of the
date first above written:
LAZARD FRERES & CO. LLC
CHASE SECURITIES INC.
Acting severally on behalf of themselves
and the several Underwriters named herein.
-----------------------
Lazard Freres & Co. LLC
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SCHEDULE I
PRINCIPAL AMOUNT
OF SECURITIES
UNDERWRITER TO BE PURCHASED
----------- ---------------------
Lazard Freres & Co. LLC............................
Chase Securities Inc...............................
Total
=====================
I-1
27
ANNEX I
FORM OF COMFORT LETTER
Pursuant to Section 6(f) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants
with respect to the Company and its subsidiaries within the
meaning of the Act and the applicable published rules and
regulations thereunder;
(ii) In their opinion, the financial statements and
any supplementary financial information and schedules audited
(and, if applicable, prospective financial statements and/or
pro forma financial information examined) by them and included
in the Prospectus or the Registration Statement comply as to
form in all material respects with the applicable accounting
requirements of the Act and the related published Rules and
Regulations; and, if applicable, they have made a review in
accordance with standards established by the American
Institute of Certified Public Accountants of the unaudited
consolidated interim financial statements, selected financial
data, pro forma financial information, prospective financial
statements and/or condensed financial statements derived from
audited financial statements of the Company for the periods
specified in such letter, as indicated in their reports
attached to such letters, copies of which have been furnished
to the Underwriters;
(iii) On the basis of limited procedures, not
constituting an audit in accordance with generally accepted
auditing standards, consisting of a reading of the unaudited
financial statements and other information referred to below,
a reading of the latest available interim financial statements
of the Company and its subsidiaries, inspection of the minute
books of the Board of Directors and the committees thereof of
the Company and its subsidiaries since the date of the latest
audited financial statements included in the Prospectus,
inquiries of officials of the Company and its subsidiaries
responsible for financial and accounting matters and such
other inquiries and procedures as may be specified in such
letter, nothing came to their attention that caused them to
believe that:
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(A) the unaudited consolidated statements of
income, consolidated balance sheets and consolidated
statements of cash flows included in the Prospectus
do not comply as to form in all material respects
with the applicable accounting requirements of the
Act and the related published Rules and Regulations,
or are not in conformity with generally accepted
accounting principles applied on a basis
substantially consistent with the basis for the
audited consolidated statements of income,
consolidated balance sheets and consolidated
statements of cash flows included in the Prospectus;
(B) any other unaudited income statement
data and balance sheet items included in the
Prospectus do not agree with the corresponding items
in the unaudited consolidated financial statements
from which such data and items were derived, and any
such unaudited data and items were not determined on
a basis substantially consistent with the basis for
the corresponding amounts in the audited consolidated
financial statements included in the Prospectus;
(C) the unaudited financial statements which
were not included in the Prospectus but from which
were derived any unaudited condensed financial
statements referred to in paragraph (A) and any
unaudited income statement data and balance sheet
items included in the Prospectus and referred to in
paragraph (B) were not determined on a basis
substantially consistent with the basis for the
audited consolidated financial statements included in
the Prospectus;
(D) any unaudited pro forma consolidated
condensed financial statements included in the
Prospectus do not comply as to form in all material
respects with the applicable accounting requirements
of the Act and the published Rules and Regulations or
the pro forma adjustments have not been properly
applied to the historical amounts in the compilation
of those statements;
(E) as of a specified date not more than
five days prior to the date of such letter, there
have been any changes in the consolidated capital
stock (other than issuances of capital stock upon
exercise of options and stock appreciation rights
II-2
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and upon earn-outs of performance shares, in each
case which were outstanding on the date of the latest
financial statements included in the Prospectus) or
any increase in the consolidated long-term debt of
the Company and its subsidiaries, or any decreases in
consolidated net current assets or net assets or
other items specified by the Underwriters, or any
increases in any items specified by the Underwriters,
in each case as compared with amounts shown in the
latest balance sheet included in the Prospectus,
except in each case for changes, increases or
decreases which the Prospectus discloses have
occurred or may occur or which are described in such
letter; and
(F) for the period from the date of the
latest financial statements included in the
Prospectus to the specified date referred to in
paragraph (E) there were any decreases in
consolidated net revenues or operating profit or the
total or per share amounts of consolidated net income
or other items specified by the Underwriters, or any
increases in any items specified by the Underwriters,
in each case as compared with the comparable period
of the preceding year and with any other period of
corresponding length specified by the Underwriters,
except in each case for decreases or increases which
the Prospectus discloses have occurred or may occur
or which are described in such letter;
(G) certain sections of the Prospectus did
not comply in all material respects with the
disclosure obligations under Regulation S-K under the
Act (e.g., "Selected Financial Data" (Item 301),
"Supplementary Financial Information" (Item 302),
"Ratio of Earnings to Fixed Charges" (Item 503(d))
and "Executive Compensation" (Item 402);
(iv) In addition to the audit referred to in their
report(s) included in the Prospectus and the limited
procedures, inspection of minute books, inquiries and other
procedures referred to in paragraphs (ii) and (iii) above,
they have carried out certain specified procedures, not
constituting an audit in accordance with generally accepted
auditing standards, with respect to certain amounts,
percentages and financial information specified by the
Underwriters, which are derived from the general accounting
records of the Company and its subsidiaries, which appear in
the Prospectus, or in
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30
Part II of, or in exhibits and schedules to, the Registration
Statement specified by the Representatives, and have compared
certain of such amounts, percentages and financial information
with the accounting records of the Company and its
subsidiaries and have found them to be in agreement.
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