Exhibit 1
FIRST DATA CORPORATION
Securities
UNDERWRITING AGREEMENT BASIC PROVISIONS
---------------------------------------
February 22, 2001
1. Introductory. First Data Corporation, a Delaware corporation (the
------------
"Company"), proposes to issue and sell from time to time senior debt securities,
subordinated debt securities, convertible subordinated debt securities
(collectively, "Debt Securities"), preferred stock and common stock registered
under the registration statement referred to in Section 2(a) ("Registered
Securities"). If specified in a Terms Agreement referred to in Section 3, the
Company proposes to grant to the underwriters an option to purchase up to that
amount of Registered Securities specified in such Terms Agreement (the "Option
Securities"). Debt Securities will be issued under one or more indentures (as
amended or supplemented from time to time, an "Indenture" and collectively, the
"Indentures"), more particularly described in a Terms Agreement, between the
Company and the trustees named therein (the "Trustee(s)"), in one or more
series, which series may vary as to interest rates, maturities, redemption
provisions, selling prices and other terms, with all such terms for any
particular series of the Debt Securities being determined at the time of sale.
The preferred stock will be issued in one or more series, which series may vary
as to voting rights, dividends, optional and mandatory redemption provisions,
liquidation preference and conversion provisions and other terms, with all such
terms for any particular series or issue of the preferred stock being determined
at the time of sale. The Registered Securities will be sold pursuant to a Terms
Agreement, for resale in accordance with terms of offering determined at the
time of sale.
The Registered Securities (together with the Option Securities)
involved in any such offering are hereinafter referred to as the "Securities."
The firm or firms which agree to purchase the Securities are hereinafter
referred to as the "Underwriters" of such Securities, and the representative or
representatives of the Underwriters, if any, specified in a Terms Agreement are
hereinafter referred to as the "Representatives"; provided, however, that if the
Terms Agreement does not specify any representative of the Underwriters, the
term "Representatives," as used in this Agreement shall mean the Underwriters.
2. Representations and Warranties of the Company. The Company
represents and warrants as of the date of this Agreement as follows:
(a) A registration statement on Form S-3 (File No. 333-24667)
with respect to the Registered Securities has (i) been prepared by the
Company in conformity with the requirements of the Securities Act of
1933, as amended (the "Securities Act"), and the rules and regulations
(the "Rules and Regulations") of the Securities and Exchange
Commission (the "Commission") thereunder and (ii) been filed with the
Commission under the Securities Act. Such registration statement has
been declared effective by the Commission. If any post-effective
amendment to such registration statement has been filed with the
Commission prior to the date of the applicable Terms Agreement, the
most recent such amendment has been declared effective by the
Commission. Copies of such registration statement and any amendments
thereto have been delivered by the Company to the Representatives. As
used in this Agreement, "Effective Time" means the respective date and
time as of which such registration statement, or the most recent post-
effective amendment thereto, if any, was declared effective by the
Commission; and "Effective Date" means the respective applicable date
of the Effective Time. As provided in Section 4(a), a prospectus
supplement relating to the Securities, the terms of the offering
thereof and the other matters set forth therein has been prepared and
will be filed pursuant to Rule 424 under the Securities Act. In
addition, a preliminary prospectus supplement reflecting the terms of
the Securities, the terms of the offering thereof, and the other
matters set forth therein also may be prepared and filed pursuant to
Rule 424 under the Securities Act. Such prospectus supplement, in the
form filed on or after the date of this Agreement pursuant to Rule
424, is referred to in this Agreement as the "Prospectus Supplement",
and any preliminary prospectus supplement in the
form filed with the Registration Statement prior to the Effective Date
or after the date of this Agreement pursuant to Rule 424, as
applicable, is referred to as the "Preliminary Prospectus Supplement."
Any prospectus accompanied by a Preliminary Prospectus Supplement is
referred to in this Agreement, collectively with such Preliminary
Prospectus Supplement, as a "Preliminary Prospectus." The registration
statement referred to in this Section 2(a), as amended at the time of
the Terms Agreement, including the exhibits thereto (but excluding the
Statement of Qualification and Eligibility (a "Form T-1")) and the
documents filed by the Company with the Commission pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), that
are incorporated by reference therein pursuant to Item 12 of Form S-3
under the Securities Act (the "Incorporated Documents") and the
information, if any, deemed to be a part of the registration statement
pursuant to Rule 430A(b) under the Securities Act, is called the
"Registration Statement", and the basic prospectus included in the
Registration Statement relating to all offerings of securities under
the Registration Statement, as supplemented by the Prospectus
Supplement, is called the "Prospectus", except that, if such basic
prospectus is amended or supplemented on or prior to the date on which
the Prospectus Supplement is first filed pursuant to Rule 424, the
term "Prospectus" shall refer to the basic prospectus as so amended or
supplemented and as supplemented by the Prospectus Supplement, in
either case including the Incorporated Documents. Notwithstanding the
foregoing, any prospectus supplement prepared or filed with respect to
an offering pursuant to the Registration Statement of securities other
than the Securities shall not be deemed to have supplemented the
Prospectus. The Commission has not issued any order suspending the
effectiveness of the Registration Statement, and no stop order has
been initiated or, to the knowledge of the Company, threatened by the
Commission.
(b) On the Effective Date, the Registration Statement conformed
in all material respects to the requirements of the Securities Act and
the Rules and Regulations, and did not contain an untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading;
and on the date of the applicable Terms Agreement, and at the time of
filing of the Prospectus pursuant to Rule 424(b), the Prospectus will
conform in all material respects to the requirements of the Securities
Act and the Rules and Regulations, and will not include an untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and on the
Closing Date, the Indenture, if any, described in the Terms Agreement
will conform in all material respects with the requirements of the
Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"),
and the applicable rules and regulations thereunder; provided that no
representation or warranty is made as to (i) information contained in
or omitted from the Registration Statement or the Prospectus in
reliance upon and in conformity with written information furnished to
the Company through the Representatives by or on behalf of any
Underwriter specifically for inclusion therein or (ii) that part of
the Registration Statement which shall constitute the Form T-1 under
the Trust Indenture Act.
(c) The Company and each of its significant subsidiaries (as
defined in Rule 405 of the Rules and Regulations) have been duly
incorporated and are validly existing as corporations in good standing
under the general corporation laws of their respective jurisdictions
of incorporation, are duly qualified to do business and are in good
standing as foreign corporations in each jurisdiction in which their
respective ownership or lease of property or the conduct of their
respective businesses requires such qualification and in which the
failure to be so incorporated, existing or qualified would reasonably
be expected to have a material adverse effect on the business,
properties, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries taken as a whole, and
have all power and authority necessary to own or hold their respective
properties and to conduct the businesses in which they are engaged.
The "significant subsidiaries" of the Company are those identified in
the Terms Agreement.
(d) All of the issued and outstanding shares of capital stock of
each significant subsidiary of the Company have been duly and validly
authorized and issued and are fully paid, non-assessable and are owned
directly or indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims.
2
(e) The execution, delivery and performance of the Terms
Agreement (including the provisions of this Agreement) by the Company
and the consummation of the transactions contemplated hereby and
thereby and compliance by the Company with the provisions of the
Indenture, if any, described in the Terms Agreement and the Securities
will not result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any material indenture,
mortgage, deed of trust, loan agreement or other material agreement or
instrument to which the Company or any of its significant subsidiaries
is a party or by which the Company or any of its significant
subsidiaries is bound or to which any of the property or assets of the
Company or any of its significant subsidiaries is subject, nor will
such actions result in any violation of the provisions of the charter
or by-laws of the Company or any of its significant subsidiaries or
any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or
any of its significant subsidiaries or any of their properties or
assets; and except for the registration of the Securities under the
Securities Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under the Trust
Indenture Act or the Exchange Act, and applicable state or foreign
securities laws in connection with the offer, sale and distribution of
the Securities by the Underwriters, no consent, approval,
authorization or order of, or filing or registration with, any such
court or governmental agency or body is required for the execution,
delivery and performance of the Terms Agreement (including the
provisions of this Agreement) by the Company and the consummation of
the transactions contemplated hereby and thereby or compliance by the
Company with the provisions of the Indenture, if any, described in the
Terms Agreement.
(f) There are no contracts, agreements or understandings between
the Company and any person granting such person the right to require
the Company to include any securities owned or to be owned by such
person in the securities registered pursuant to the Registration
Statement or, except as described in the Prospectus or Schedule B to
the Terms Agreement (or in Schedule B to any applicable Officers'
Certificate delivered pursuant to Section 6(g)), to require the
Company to file any other registration statement under the Securities
Act (other than a registration statement on Form S-8) with respect to
any securities of the Company owned or to be owned by such person or
to require the Company to include such securities in any securities
being registered pursuant to any other registration statement filed by
the Company under the Securities Act.
(g) The Indenture, if any, described in the Terms Agreement has
been duly authorized, executed and delivered by the Company and
(assuming the due authorization, execution and delivery thereof by the
Trustee under the Indenture) constitutes the valid and legally binding
obligation of the Company, enforceable against the Company in
accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors'
rights generally and general equitable principles (whether considered
in a proceeding in equity or at law); the Debt Securities, if any,
described in the Terms Agreement have been duly authorized by the
Company and, when the terms of the Debt Securities and of their
issuance and sale have been duly established in accordance with the
Indenture, this Agreement and the Terms Agreement and the Debt
Securities have been duly executed, authenticated, issued and
delivered in the manner provided in the Indenture and paid for in
accordance with this Agreement and the Terms Agreement, the Debt
Securities will be duly and validly issued and delivered by the
Company and will constitute valid and legally binding obligations of
the Company, enforceable against the Company in accordance with their
terms, except as enforceability may be limited by bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and
other similar laws relating to or affecting creditors' rights
generally and general equitable principles (whether considered in a
proceeding or equity or at law), and entitled to the benefits of the
Indenture; if any Securities to be issued are convertible, the shares
of common stock issuable upon conversion thereof have been duly
authorized by the Company, have been duly reserved for issuance upon
conversion of the Securities and, when issued upon the conversion of
the Securities, will be duly and validly issued, fully paid and non-
assessable; the common stock and preferred stock, if any, described in
the Terms Agreement have been duly authorized by the Company and, when
issued and paid for pursuant to the Terms Agreement, will be duly and
validly issued, fully paid and non-assessable;
3
no further approval or authority of the stockholders or the Board of
Directors of the Company will be required for the issuance and sale of
the Securities as contemplated herein or the issuance of the shares of
common stock upon conversion of the Securities; and the Securities,
the Indenture, if any, described in the Terms Agreement and the
capital stock of the Company will conform in all material respects to
the descriptions thereof contained in the Registration Statement and
the Prospectus.
(h) Since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus, there has not
been any material change in the capital stock or long-term debt of the
Company or any of its significant subsidiaries (otherwise than as set
forth or contemplated in the Prospectus) or any material adverse
change in or affecting, or any adverse development which materially
affects, the business, properties, financial position, stockholders'
equity or results of operations of the Company and its subsidiaries
taken as a whole, otherwise than as set forth or contemplated in the
Prospectus.
(i) The financial statements (including the related notes and
supporting schedules) included or incorporated by reference in the
Registration Statement or included or incorporated by reference in the
Prospectus present fairly in all material respects the financial
condition and results of operations of the entities purported to be
shown thereby, at the dates and for the periods indicated, and have
been prepared in conformity with generally accepted accounting
principles applied on a consistent basis throughout the periods
involved, except as otherwise stated therein.
(j) Ernst & Young LLP, or such other independent accountants
acceptable to the Representatives, who have certified certain
financial statements of the Company and whose report appears or is
incorporated by reference in the Prospectus, are independent public
accountants as required by the Securities Act and the Rules and
Regulations during the periods covered by the financial statements on
which they reported contained in the Prospectus.
(k) The Company has no reason to believe that the Company and
each of its significant subsidiaries do not own or possess adequate
rights to use all material patents, patent applications, trademarks,
service marks, trade names, trademark registrations, service xxxx
registrations, copyrights and licenses necessary for the conduct of
their respective businesses in the manner described in the Prospectus
and have no reason to believe that the conduct of their respective
businesses will violate any such rights of others, and have not
received any notice of any claims of violation of any such rights of
others, which claims are reasonably expected to have a material
adverse effect on the business, properties, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries taken as a whole.
(l) Except as described in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its
significant subsidiaries is a party or of which any property of the
Company or any of its significant subsidiaries is the subject which
are reasonably expected to have a material adverse effect on the
business, properties, financial position, stockholders' equity or
results of operations of the Company and its subsidiaries taken as a
whole; and to the actual knowledge of the Company, no such proceedings
are threatened by governmental authorities or by others.
(m) There are no contracts or other documents which are required
to be filed as exhibits to the Registration Statement by the
Securities Act or by the Rules and Regulations which have not been
filed (or incorporated by reference) as exhibits to the Registration
Statement.
(n) Except as described in the Prospectus or Schedule C to the
Terms Agreement (or in Schedule C to any applicable Officers'
Certificate delivered pursuant to Section 6(g)), since the date as of
which information is given in the Prospectus, the Company has not (i)
issued or granted any rights to acquire any securities (other than
pursuant to employee benefit plans or other compensation plans
existing on the date of the Terms Agreement) or (ii) declared or paid
any dividend on its capital stock other than regular quarterly cash
dividends.
4
(o) Neither the Company nor any of its subsidiaries,
respectively, (i) is in violation of its charter or by-laws, (ii) is
in default, and no event has occurred which, with notice or lapse of
time or both, would constitute a default, in the due performance or
observance of any term, covenant or condition contained in any
material indenture, mortgage, deed of trust, loan agreement or other
material agreement or instrument to which it is a party or by which it
is bound or to which any of its properties or assets is subject or
(iii) is in violation of any law, ordinance, governmental rule,
regulation or court decree to which it or its property or assets may
be subject or has failed to obtain any license, permit, certificate,
franchise or other governmental authorization or permit necessary to
the ownership of its property or to the conduct of its business
except, in the case of clauses (ii) and (iii), for those defaults,
violations or failures which, either individually or in the aggregate,
are not reasonably expected to have a material adverse effect on the
business, properties, financial position, stockholders' equity or
results of operations of the Company and its subsidiaries taken as a
whole.
(p) The Company is not required to be registered, and is not
regulated, as an "investment company" as such term is defined under
the United States Investment Company Act of 1940.
3. Purchase and Offering of the Securities by the Underwriters. The
obligation of the Underwriters to purchase the Securities will be evidenced
by an exchange of a telegram, telex or other written communications ("Terms
Agreement") at each time the Company determines to sell the Securities.
Each Terms Agreement will be in the form of Annex II (A) or (B) attached
hereto and will incorporate by reference the provisions of this Agreement,
except as otherwise provided therein, and will specify the firm or firms
which will be Underwriters, the names of any Representatives, the amount to
be purchased by each Underwriter, the purchase price to be paid by the
Underwriters and certain terms of the Securities and whether any of the
Securities may be sold to institutional investors pursuant to Delayed
Delivery Contracts (as defined below). The Terms Agreement will also
specify the time and date of delivery and payment (such time and date being
herein and in the Terms Agreement referred to as the "Closing Date"), the
place of delivery and payment and any details of the terms of public
offering that should be reflected in the Prospectus Supplement relating to
the offering of the Securities. The obligations of the Underwriters to
purchase the Securities will be several and not joint. It is understood
that the Underwriters propose to offer the Securities for sale as set forth
in the Prospectus.
If specified in a Terms Agreement, on the basis of the
representations, warranties and covenants contained in this Agreement, and
subject to the terms and conditions set forth in this Agreement, the
Company grants an option to the several Underwriters to purchase, severally
and not jointly, up to that amount of the Option Securities as shall be
specified in the Terms Agreement from the Company at the same price as the
Underwriters shall pay for the Registered Securities. Said option may be
exercised only to cover over-allotments in the sale of the Registered
Securities by the Underwriters and may be exercised in whole or in part at
any time on or before the thirtieth day after the date of the Terms
Agreement upon written or telegraphic notice by the Representatives to the
Company setting forth the amount of the Option Securities as to which the
several Underwriters are exercising the option. The amount of Option
Securities to be purchased by each Underwriter shall be the same percentage
of the total amount of the Option Securities to be purchased by the several
Underwriters as such Underwriter is purchasing of the Registered
Securities, as adjusted by the Representatives in such manner as the
Representatives deem advisable to avoid fractional shares/units.
If the Terms Agreement provides for sales of Securities pursuant to
delayed delivery contracts, the Company authorizes the Underwriters to
solicit offers to purchase Securities pursuant to delayed delivery
contracts substantially in the form of Annex I attached hereto ("Delayed
Delivery Contract") with such changes therein as the Company may authorize
or approve. Delayed Delivery Contracts are to be made only with
institutional investors, including commercial and savings banks, insurance
companies, pension funds, investment companies and educational and
charitable institutions. On the Closing Date the Company will pay, as
compensation, to the Representatives for the accounts of the Underwriters,
the fee set forth in such Terms Agreement in respect of the amount of
Securities to be sold pursuant to Delayed Delivery Contracts ("Contract
Securities"). The Underwriters will not have any responsibility in respect
of the validity or the performance of Delayed Delivery Contracts. If the
Company executes and delivers
5
Delayed Delivery Contracts, the Contract Securities will be deducted from
the Securities to be purchased by the several Underwriters and the
aggregate amount of Securities to be purchased by each Underwriter will be
reduced pro rata in proportion to the amount of Securities set forth
opposite each Underwriter's name in such Terms Agreement, except to the
extent that the Representatives determine that such reduction shall be
otherwise than pro rata and so advise the Company. The Company will advise
the Representatives not later than the business day prior to the Closing
Date of the amount of Contract Securities.
4. Covenants of the Company. The Company agrees:
(a) To prepare the Prospectus in a form approved by the
Representative (which approval will not be unreasonably delayed or
withheld) and to file such Prospectus, including the Prospectus
Supplement, pursuant to Rule 424(b) within the time period prescribed
by the Rules and Regulations; to notify the Representatives, promptly
after it receives notice, of the time when the Registration Statement
or any amendment thereto becomes effective or promptly after the
filing of any supplement or amendment to the Prospectus (other than
any Incorporated Document or any amendment or supplement relating to
an offering of securities other than the Securities) and to furnish
the Representatives with copies thereof; to notify the
Representatives, promptly after it receives notice thereof, of the
issuance by the Commission of any stop order or of any order
preventing or suspending the use of any Preliminary Prospectus or the
Prospectus, of the suspension of the qualification of the Securities
for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of any request
by the Commission for the amending or supplementing of the
Registration Statement or the Prospectus or for additional
information; and, in the event of the issuance of any stop order or of
any order preventing or suspending the use of any Preliminary
Prospectus or the Prospectus or suspending any such qualification, to
use promptly its best efforts to obtain its withdrawal;
(b) To furnish promptly to each of the Representatives and to
counsel for the Underwriters a copy of the Registration Statement as
originally filed with the Commission, and each amendment thereto filed
with the Commission, including all exhibits filed therewith;
(c) To furnish promptly to each of the Representatives copies of
the Registration Statement, including all exhibits, any Preliminary
Prospectus, the Prospectus and all amendments and supplements to such
documents, in each case as soon as available and in such quantities as
are reasonably requested;
(d) To file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the
Prospectus that may be required by the Securities Act, in the
reasonable judgment of the Company or the Representatives, or
requested by the Commission;
(e) Prior to filing with the Commission any (i) amendment to the
Registration Statement or supplement to the Prospectus or (ii) any
Prospectus pursuant to Rule 424 of the Rules and Regulations (other
than any Incorporated Document or any amendment or supplement relating
to an offering of securities other than the Securities), to furnish a
copy thereof to the Representatives and counsel for the Underwriters;
(f) As soon as practicable but no later than 16 months after the
date of each Terms Agreement, to make generally available to its
security holders an earning statement of the Company and its
subsidiaries (which need not be audited) complying with Section 11(a)
of the Securities Act (including, at the option of the Company, Rule
158) covering a period of at least twelve months beginning on the
first day of the first fiscal quarter of the Company commencing after
the later of (i) the effective date of the Registration Statement,
(ii) the effective date of the most recent post-effective amendment to
the Registration Statement to become effective prior to the date of
such Terms Agreement and (iii) the date of the Company's most recent
Annual Report on Form 10-K filed with the Commission prior to the date
of such Terms Agreement;
6
(g) During the period, if any, specified in the Terms Agreement
after the date of such Terms Agreement, to furnish to the
Representatives copies of all materials furnished by the Company to
its stockholders and all public reports and financial statements
furnished by the Company to the principal national securities exchange
upon which the common stock of the Company may be listed pursuant to
requirements of or agreements with such exchange or to the Commission
pursuant to the Exchange Act or any rule or regulation of the
Commission thereunder;
(h) Promptly from time to time, to take such action as the
Representatives reasonably may request to qualify the Securities for
offering and sale under the securities laws of such jurisdictions as
the Representatives may request and to comply with such laws so as to
permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the
distribution of the Securities; provided, however, that in connection
therewith the Company shall not be required to qualify as a foreign
corporation or to file a general consent to service of process in any
jurisdiction or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject;
and
(i) (A) in the event of an offering of common stock, preferred
stock or convertible debt securities, for the period specified in the
Terms Agreement, if any, to not (i) offer for sale, sell or otherwise
dispose of, directly or indirectly, any shares of common stock of the
Company or permit the registration under the Securities Act of any
shares of common stock of the Company (other than the Securities and
shares issued pursuant to employee benefit plans, qualified stock
option plans or other employee compensation plans), (ii) sell or grant
options, rights or warrants with respect to any shares of common stock
of the Company (other than the Securities and the grant of options
pursuant to employee benefit plans), or (iii) offer for sale, sell or
otherwise dispose of, directly or indirectly, any securities
convertible into or, exchangeable or exercisable for common stock of
the Company (other than the Securities), without, in any case, the
prior written consent of a majority of the Representatives; provided,
however, the Company may, without such consent, offer and sell shares
of common stock of the Company in transactions exempt from the
registration requirements of the Securities Act, provided that the
purchasers in such transactions are prohibited from offering for sale,
selling or otherwise disposing of, directly or indirectly, any of the
shares of common stock of the Company so acquired by them for the
remainder of the period specified in the Terms Agreement and, (B) in
the event of an offering of Debt Securities, between the date of the
Terms Agreement and the date of delivery of the Debt Securities, offer
for sale, sell or cause to be offered for sale or sold, without the
prior written consent of a majority of the Representatives, any debt
securities which are substantially similar to the Securities.
5. Expenses. The Company agrees to pay (a) the costs incident to the
authorization, issuance, sale and delivery of the Securities and any taxes
payable in connection therewith; (b) the costs incident to the preparation,
printing and filing under the Securities Act of the Registration Statement and
any amendments and exhibits thereto; (c) the costs of distributing the
Registration Statement as originally filed and each amendment thereto and any
post-effective amendments thereto (including, in each case, exhibits), any
Preliminary Prospectus, the Prospectus and any amendment or supplement to the
Prospectus and any Incorporated Documents, all as provided in this Agreement;
(d) the costs of reproducing and distributing this Agreement; (e) the filing
fees incident to securing any required review by the National Association of
Securities Dealers, Inc. of the terms of sale of the Securities, if necessary;
(f) any applicable stock exchange listing or other fees; (g) the fees and
expenses of filings, if any, with foreign securities administrators and of
qualifying the Securities under the securities laws of the several jurisdictions
as provided in Section 4(h) and of preparing, reproducing and distributing a
Blue Sky Memorandum (including related fees (in an amount not to exceed $10,000)
and disbursements of counsel to the Underwriters); (h) the fees paid to rating
agencies in connection with the rating of the Securities; (i) the costs of
printing and issuance of certificates, if any; (j) reasonable fees and
disbursements of the Trustee and any transfer agent; and (k) all other
reasonable costs and expenses incident to the performance of the obligations of
the Company under this Agreement; provided that except as provided in this
Section 5 and in Section 10, the Underwriters shall pay their own costs and
expenses, including the costs and expenses of their counsel, any transfer taxes
on the Securities which they may sell and the expenses of advertising any
offering of the Securities made by the Underwriters, and the Company shall pay
7
the fees and expenses of its counsel and any transfer taxes payable in
connection with its sale of Securities to the Underwriters.
6. Conditions of Underwriters' Obligations. The respective
obligations of the Underwriters hereunder are subject to the accuracy, when made
and at the time of delivery of any Securities pursuant to a Terms Agreement, of
the representations and warranties of the Company contained in this Agreement,
to the performance by the Company of its obligations under this Agreement, and
to each of the following additional terms and conditions:
(a) The Prospectus as amended or supplemented shall have been filed
with the Commission pursuant to Rule 424(b) under the Securities Act within
the applicable time period prescribed for such filing by the Rules and
Regulations and in accordance with Section 4(a); no stop order suspending
the effectiveness of the Registration Statement or any part thereof shall
have been issued and no proceeding for that purpose shall have been
initiated or, to the knowledge of the Company or the Underwriters,
threatened by the Commission; and any additional information required by
the Commission to be included in the Registration Statement or the
Prospectus or otherwise shall have been so included.
(b) No Underwriter shall have discovered and disclosed to the Company
on or prior to the Closing Date that the Registration Statement or the
Prospectus or any amendment or supplement thereto contains an untrue
statement of a fact which, in the opinion of the counsel for the
Underwriters, is material or omits to state a fact which, in the opinion of
such counsel, is material and is required to be stated therein or is
necessary to make the statements therein not misleading.
(c) All corporate proceedings and other legal matters necessary for
the authorization and validity of this Agreement, the Terms Agreement, the
Indenture, if any, described in the Terms Agreement, the Securities, the
Registration Statement and the Prospectus, and all other legal matters
relating to this Agreement and the Terms Agreement and the transactions
contemplated hereby and thereby shall be reasonably satisfactory in all
material respects to counsel for the Underwriters, and the Company shall
have furnished to such counsel all documents and information that they may
reasonably request to enable them to pass upon such matters.
(d) Sidley & Austin, counsel to the Company, or other counsel to the
Company satisfactory to the Representatives, shall have furnished to the
Representatives their written opinion, as counsel to the Company, addressed
to the Underwriters and dated the Closing Date, and, if Option Securities
are purchased, at any date after the Closing Date as specified in a Terms
Agreement, additional opinions from such counsel, in form and substance
acceptable to the Representatives to the effect that:
(i) The Indenture, if any, described in the Terms Agreement has
been duly authorized, executed and delivered by the Company and duly
qualified under the Trust Indenture Act, and, assuming due
authorization, execution and delivery thereof by the Trustee,
constitutes a valid and legally binding obligation of the Company
enforceable against the Company in accordance with its terms;
(ii) The Debt Securities, if any, described in the Terms Agreement
have been duly authorized by the Company, and when the Debt Securities
have been duly executed, authenticated, issued and delivered in the
manner provided in the Indenture and paid for in accordance with this
Agreement and the Terms Agreement or, in the case of Contract
Securities, in accordance with Delayed Delivery Contracts, the Debt
Securities will be duly and validly issued and delivered by the
Company and will constitute valid and legally binding obligations of
the Company, enforceable against the Company in accordance with their
terms and entitled to the benefits of the Indenture;
(iii) If any Securities to be issued are convertible into common
stock, the shares of common stock initially issuable upon conversion
of the Securities have been reserved for issuance upon such
conversion; and when certificates therefor have been duly executed,
countersigned, registered and delivered upon such conversion, will
constitute shares of common stock which have been duly authorized and
validly issued and are fully paid and non-assessable;
8
(iv) The common stock and preferred stock, if any, described in the
Terms Agreement; when certificates therefor have been duly executed,
countersigned, registered and delivered in accordance with this
Agreement and the Terms Agreement or, in the case of Contract
Securities, in accordance with Delayed Delivery Contracts, constitute
shares of common stock or preferred stock, as the case may be, which
have been duly authorized and validly issued and are fully paid and
non-assessable;
(v) The Registration Statement was declared effective under the
Securities Act as of the date specified in such opinion; any required
filing of the Prospectus pursuant to Rule 424(b) of the Rules and
Regulations has been made within the time period prescribed by the
Rules and Regulations; and, to the knowledge of such counsel, no stop
order suspending the effectiveness of the Registration Statement has
been issued and, to the knowledge of such counsel, no proceeding for
that purpose is pending or threatened by the Commission;
(vi) At the Effective Time, the Registration Statement (including
all documents incorporated by reference therein) complied, and on the
date of the Terms Agreement, the Prospectus (including all documents
incorporated by reference therein) complies, and any further
amendments or supplements thereto made by the Company on or prior to
the date of such opinion comply (other than, in each case, the
financial statements and related schedules and other financial and
statistical data included or incorporated by reference therein and the
Form T-1 under the Trust Indenture Act, as to which such counsel need
express no opinion) as to form in all material respects with the
requirements of the Securities Act, the Exchange Act and the
applicable rules and regulations under said Acts;
(vii) The Securities, other than any Contract Securities, the
Indenture and the capital stock of the Company conform, and any
Contract Securities, when issued, delivered and sold, will conform, in
all material respects to the descriptions thereof contained or
incorporated by reference in the Registration Statement and the
Prospectus;
(viii) To such counsel's knowledge, there are no contracts or other
documents which are required to be filed as exhibits to the
Registration Statement by the Securities Act or by the Rules and
Regulations which have not been so filed;
(ix) The Terms Agreement, this Agreement and any Delayed Delivery
Contracts have been duly authorized, executed and delivered by the
Company;
(x) The sale of the Securities by the Company, compliance by the
Company with all of the provisions of this Agreement, the Terms
Agreement, the Indenture, if any, described in the Terms Agreement,
any Delayed Delivery Contracts and the Securities and the consummation
by the Company of the transactions contemplated hereby and thereby
will not result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any agreement or
instrument scheduled in such opinion (as in effect on the date of such
opinion); and, except for the registration of the Securities under the
Securities Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under the Trust
Indenture Act, the Exchange Act and applicable state or foreign
securities laws in connection with the offer and sale of the
Securities by the Underwriters, no consent, approval, authorization or
order of, or filing or registration with, any court or any
governmental agency or body is required for the execution, delivery
and performance of this Agreement by the Company and the consummation
by the Company of the transactions contemplated hereby; and
(xi) The Company is not required to be registered, and is not
regulated, as an "investment company" as such term is defined under
the United States Investment Company Act of 1940.
In addition, such counsel shall state that in the course of the preparation
of the Registration Statement and the Prospectus, such counsel has
considered the information set forth therein in light of the matters
required to be set forth therein and such counsel has participated in
conferences with officers and representatives of
9
the Company, including its independent public accountants and, with respect
to the Prospectus, representatives of and counsel for the Representatives
during the course of which the contents of the Registration Statement and
Prospectus and related matters were discussed and, although such counsel
shall not have independently checked the accuracy or completeness of, or
otherwise verified, and accordingly are not passing upon, and shall not
assume responsibility for, the accuracy, completeness or fairness of the
statements contained in or incorporated by reference in the Registration
Statement and Prospectus (except as set forth in subparagraph (vii) above),
and that such counsel has relied as to materiality, to a large extent, upon
the judgment of officers and representatives of the Company, as a result of
such consideration and participation, nothing has come to the attention of
such counsel which causes such counsel to believe that the Registration
Statement as of the Effective Time(s) or, if later, as of the date of the
Company's most recent filing of an Annual Report on Form 10-K (including
such Annual Report on Form 10-K), 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 the date of such opinion, includes an untrue
statement of a material fact or omits to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading (except that, in each case, such
counsel need not express any belief as to the financial statements and
related schedules and other financial and statistical data included or
incorporated by reference in the Registration Statement or the Prospectus).
In rendering such opinion, such counsel may (i) state that their
opinion is limited to the federal laws of the United States, the laws of
the State of New York and the General Corporation Law of the State of
Delaware, (ii) rely as to matters of fact upon the representations
contained in this Agreement and the certificates of officers of the Company
and it subsidiaries and of public officials; provided that such counsel
shall furnish copies thereof to the Representatives and state that they
believe that the Underwriters and they are justified in relying upon such
certificates and (iii) state that their opinions set forth in subparagraphs
(i) and (ii) above are subject to the qualification that the enforceability
of the Company's obligations under the Indenture and the Securities may be
limited by bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors'
rights generally, general equitable principles (whether considered in a
proceeding in equity or at law) or by an implied covenant of good faith and
fair dealing.
(e) The General Counsel or other counsel of the Company, shall have
furnished to the Representatives his written opinion, addressed to the
Underwriters and dated the Closing Date, and, if Option Securities are
purchased, at any date after the Closing Date as specified in a Terms
Agreement, additional opinions from such counsel, in form and substance
satisfactory to the Representatives to the effect that:
(i) The Company and each of its significant subsidiaries (as
defined in Rule 405 under the Securities Act and identified in the
Terms Agreement) have been duly incorporated and are validly existing
as corporations in good standing under the general corporation laws of
their respective jurisdictions of incorporation and have all corporate
power and authority necessary to own or hold their respective
properties and conduct the businesses in which they are engaged;
(ii) All of the issued and outstanding shares of capital stock
of each significant subsidiary have been duly and validly authorized
and issued and are fully paid, non-assessable and (except for
directors' qualifying shares) owned directly or indirectly by the
Company, free and clear of all liens, encumbrances, equities or
claims;
(iii) To such counsel's knowledge, and other than as set forth
or contemplated in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its subsidiaries is
a party or of which any property of the Company or any of its
subsidiaries is the subject which are reasonably expected to have a
material adverse effect on the business, properties, financial
position, stockholders' equity or results of operations of the Company
and its subsidiaries taken as a whole; and, to such counsel's
knowledge, no such proceedings are threatened by governmental
authorities or by others;
10
(iv) The sale of the Securities by the Company and the
compliance by the Company with all of the provisions of this
Agreement, the Terms Agreement, the Indenture, if any, described in
the Terms Agreement, any Delayed Delivery Contract and the Securities,
and the consummation of the transactions contemplated hereby and
thereby will not (A) result in a breach or violation of any of the
terms or provisions of, or constitute a default under, an material
indenture or loan agreement known to such counsel or (B) to the
knowledge of such counsel, result in a breach or violation of any of
the terms or provisions of, or constitute a default under, any
material mortgage, deed of trust or other material agreement or
instrument, to which the Company or any of its significant
subsidiaries is a party or by which the Company or any of its
significant subsidiaries is bound or to which any of the property or
assets of the Company or any of its significant subsidiaries is
subject, nor will such actions result in any violation of the
provisions of the charter or by-laws of the Company or any significant
subsidiary or of any statute or any order, rule or regulation known to
such counsel of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of
their properties or assets (except that such counsel need express no
opinion with respect to applicable state or foreign securities laws);
(v) To such counsel's knowledge, neither the Company nor any
significant subsidiary (A) is in violation of its charter or by-laws,
(B) is in default, and no event has occurred, which, with notice or
lapse of time or both, would constitute a default, in the due
performance or observance of any term, covenant or condition contained
in any material indenture, mortgage, deed of trust, loan agreement or
other material agreement or instrument to which it is a party or by
which it is bound or to which any of its properties or assets is
subject or (C) is in violation of any law, ordinance, governmental
rule, regulation or court decree to which it or its property or assets
may be subject or has failed to obtain any license, permit,
certificate, franchise or other governmental authorization or permit
necessary to the ownership of its property or to the conduct of its
business except, in the case of clauses (B) and (C), for those
defaults, violations or failures which, either individually or in the
aggregate, are not reasonably expected to have a material adverse
effect on the business, properties, financial position, stockholders'
equity or results of operations of the Company and its subsidiaries
taken as a whole; and
(vi) To such counsel's knowledge, there are no contracts,
agreements or understandings between the Company and any person
granting such person the right to require the Company to include any
securities owned or to be owned by such person in the securities
registered pursuant to the Registration Statement, or, except as
described in the Prospectus or Schedule B to the Terms Agreement, to
require the Company to file any other registration statement under the
Securities Act (other than a registration statement on Form S-8) with
respect to any securities of the Company owned or to be owned by such
person or to require the Company to include such securities in any
securities being registered pursuant to any other registration
statement filed by the Company under the Securities Act.
In rendering such opinion, such counsel may (i) state that his opinion
is limited to the federal laws of the United States, the laws of the State
of Nebraska and the General Corporation Law of the State of Delaware and
(ii) rely as to matters of fact upon certificates of officers of the
Company and its subsidiaries and of public officials; provided that such
counsel shall furnish copies thereof to the Representatives and state that
he believes that the Underwriters and such counsel are justified in relying
upon such certificates.
(f) The Company shall have furnished to the Representatives on the
Closing Date a letter of Ernst & Young LLP, addressed jointly to the
Company and the Underwriters and dated the Closing Date of the type
described in the American Institute of Certified Public Accountants'
Statement on Auditing Standards No. 72, and covering such additional
financial statement items and procedures (including a review of interim
financial statements specified in the American Institute of Certified
Public Accountants' Statement on Auditing Standards No. 71) as the
Representatives may reasonably request and in form and substance
satisfactory to the Representatives.
11
(g) The Company shall have furnished to the Representatives a
certificate, dated the Closing Date, and on any later date, if any, on
which Option Securities are purchased, of its Chief Financial Officer or
Treasurer and its General Counsel or other counsel stating that the
representations and warranties of the Company in Section 2 of this
Agreement which representations or warranties are qualified by materiality
are true and correct as of such date and all other representations and
warranties of the Company in Section 2 of this Agreement are true and
correct in all material respects as of such date; the Company has performed
all of its agreements contained in this Agreement which are required to be
performed on or before the date of such certificate and the conditions set
forth in subsections 6(h) and (j) of this Agreement have been fulfilled;
and no stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no proceeding for
that purpose shall have been initiated or, to the knowledge of such
officers, threatened by the Commission.
(h) Since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus, there shall not
have been any material change in the capital stock or long-term debt of the
Company or any of its significant subsidiaries (otherwise than as set forth
or contemplated in the Prospectus or in a supplement thereto) or any change
in or affecting, or any adverse development which affects, the business,
properties, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries taken as a whole, otherwise
than as set forth or contemplated in the Prospectus, the effect of which,
in any such case, is so material and adverse as to make it, in the good
faith judgment of the Representatives, impracticable or inadvisable to
proceed with the public offering or the delivery of the Securities being
delivered on the Closing Date on the terms and in the manner contemplated
herein or in the Prospectus or in a supplement thereto.
(i) Subsequent to the execution and delivery of the Terms Agreement
there shall not have occurred any of the following: (i) trading in
securities generally on the New York Stock Exchange, Inc. (the "NYSE"), the
American Stock Exchange or the over-the-counter market shall have been
suspended or minimum prices shall have been established on either of such
exchanges or such market by the Commission, by such exchange or by any
other regulatory body or governmental authority having jurisdiction, (ii) a
banking moratorium shall have been declared by Federal or state
authorities, (iii) the United States shall have become engaged in
hostilities, there shall have been an escalation in hostilities involving
the United States or there shall have been a declaration of a national
emergency or war by the United States or (iv) there shall have occurred a
material adverse change in general economic, political or financial
conditions the result of which, in the case of each of clauses (i)-(iv),
makes it (or, in the case of clause (iv), the effect of international
conditions on the financial markets in the United States shall be such
that), in the good faith judgment of the Representatives, impracticable or
inadvisable to proceed with the delivery of the Securities.
(j) Subsequent to the execution and delivery of the Terms Agreement,
(i) no downgrading shall have occurred in the rating accorded 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) of the Rules and Regulations and (ii) no such 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.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Underwriters.
7. Indemnification and Contribution.
(a) The Company shall indemnify and hold harmless each Underwriter
and each person, if any, who controls any Underwriter within the meaning of the
Securities Act, from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof (including, but not limited to, any
loss, claim, damage, liability or action relating to the purchases and sales of
Securities), to which that Underwriter or controlling person may become subject,
under the Securities Act or otherwise, insofar as such loss, claim, damage,
liability or action arises out of, or is based upon, (i) an untrue statement or
alleged untrue statement of a material fact contained in the
12
Registration Statement or in any amendment thereto or the omission or alleged
omission therefrom of a material fact required to be stated therein or necessary
to make the statements therein not misleading or (ii) an untrue statement of a
material fact included in any Preliminary Prospectus or the Prospectus or in any
amendment or supplement thereto or the omission or alleged omission therefrom of
a material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading, and shall
reimburse each Underwriter and each such controlling person for any legal or
other expenses reasonably incurred by that Underwriter or controlling person in
connection with investigating or defending or preparing to defend against any
such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that the Company shall not be liable in any such case to the
extent that any such loss, claim, damage, liability or action arises out of, or
is based upon, any untrue statement or alleged untrue statement or omission or
alleged omission made in any Preliminary Prospectus, the Registration Statement,
or the Prospectus or in any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company through the
Representatives by or on behalf of any Underwriter specifically for inclusion
therein, or made in any Statement of Eligibility on Form T-1 filed as an exhibit
to the Registration Statement; and provided further, that as to any Preliminary
Prospectus or supplement thereto this indemnity agreement shall not inure to the
benefit of any Underwriter or any person controlling that Underwriter on account
of any loss, claim, damage, liability or action arising from the sale of
Securities to any person by that Underwriter if that Underwriter failed to send
or give a copy of the Prospectus, as the same may be amended or supplemented, to
that person within the time required by the Securities Act, and the untrue
statement or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact in such Preliminary Prospectus or supplement
thereto was corrected in the Prospectus, unless such failure resulted from non-
compliance by the Company with Section 4(c). For purposes of the second proviso
to the immediately preceding sentence, the term Prospectus shall not be deemed
to include the documents incorporated by reference therein, and no Underwriter
shall be obligated to send or give any supplement or amendment to any document
incorporated by reference in a Preliminary Prospectus or supplement thereto or
the Prospectus to any person other than a person to whom such Underwriter has
delivered such incorporated documents in response to a written request therefor.
The foregoing indemnity agreement is in addition to any liability which the
Company may otherwise have to any Underwriter or to any controlling person of
that Underwriter.
(b) Each Underwriter, severally and not jointly, shall indemnify and
hold harmless the Company, each of its directors (including any person who, with
his or her consent, is named in the Registration Statement as about to become a
director of the Company), each of its officers who signed the Registration
Statement, and each person, if any, who controls the Company within the meaning
of the Securities Act, from and against any loss, claim, damage or liability,
joint or several, or action in respect thereof, to which the Company or any such
director, officer or controlling person may become subject, under the Securities
Act or otherwise, insofar as such loss, claim, damage, liability or action
arises out of, or is based upon, (i) an untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or in any
amendment thereto or the omission or alleged omission therefrom of a material
fact required to be stated therein or necessary to make the statements therein
not misleading or (ii) an untrue statement or alleged untrue statement of a
material fact included in any Preliminary Prospectus or in any amendment or
Supplement thereto or the omission or alleged omission therefrom of a material
fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, but in each case only
to the extent that the untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon and in conformity with written
information furnished to the Company through the Representatives by or on behalf
of that Underwriter specifically for inclusion therein, and shall reimburse the
Company and any such director, officer or controlling person for any legal or
other expenses reasonably incurred by the Company or any such director, officer
or controlling person in connection with investigating or defending or preparing
to defend against any such loss, claim, damage, liability or action as such
expenses are incurred. The foregoing indemnity agreement is in addition to any
liability which any Underwriter may otherwise have to the Company or any such
director, officer or controlling person.
(c) Promptly after receipt by an indemnified party under this Section
7 of notice of any claim or the commencement of any action, if a claim in
respect thereof is to be made against the indemnifying party under this Section
7, the indemnified party shall notify the indemnifying party in writing of the
claim or the commencement of that action; provided, however, that the failure to
notify the indemnifying party shall not relieve it from any liability which it
may have to an indemnified party otherwise than under this Section 7. If any
such claim or action shall be brought against an indemnified party, and the
indemnified party shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly
13
with any other similarly notified indemnifying party, to assume the defense
thereof with counsel reasonably satisfactory to the indemnified party. After
notice from the indemnifying party to the indemnified party of its election to
assume the defense of such claim or action, the indemnifying party shall not be
liable to the indemnified party under this Section 7 for any legal or other
expenses subsequently incurred by the indemnified party in connection with the
defense thereof other than reasonable costs of investigation; provided, however,
that the Representatives shall have the right to employ counsel to represent
jointly the Representatives and those other Underwriters and their respective
controlling persons who may be subject to liability arising out of any claim in
respect of which indemnity may be sought by the Underwriters against the Company
under this Section 7, if, in the reasonable judgment of the Representatives, if
there are legal defenses available to them which are different from or in
addition to those available to such indemnifying party (it being understood that
the Company 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 allegations or circumstances, be liable for
the reasonable fees and expenses of more than one separate firm of attorneys
(other than local counsel which shall be engaged only for purposes of appearing
with such counsel in such jurisdictions in which such firm of attorneys is not
licensed to practice)), and in that event the fees and expenses of such separate
counsel shall be paid by the Company. Anything in this Section 7(c) to the
contrary notwithstanding, an indemnifying party shall not be liable for any
settlement of any claim or action effected without its written consent.
(d) If the indemnification provided for in this Section 7 shall for
any reason be unavailable to or insufficient to hold harmless an indemnified
party under Section 7(a) or 7(b) in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to therein (other than by
reason of the failure to give notice, as provided in the first sentence of
Section 7(c)), then each indemnifying party shall, in lieu of indemnifying such
indemnified party, contribute to the amount paid or payable by such indemnified
party as a result of such loss, claim, damage or liability, or action in respect
thereof, (i) in such proportion as shall be 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, 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 with respect to the statements or omissions which
resulted in such loss, claim, damage or liability, or action in respect thereof,
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 with
respect to such offering shall be deemed to be in the same proportion as the
total net proceeds from the offering of the Securities purchased under this
Agreement (before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by the Underwriters with respect
to the Securities purchased under this Agreement, in each case as set forth in
the table on the cover page of the Prospectus. The relative fault shall be
determined by reference to whether the untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company or the Underwriters, the intent of the
parties and their relative knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company and the Underwriters
agree that it would not be just and equitable if contributions pursuant to this
Section 7(d) were to be 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 into account the equitable considerations
referred to in this Section 7(d). The amount paid or payable by an indemnified
party as a result of the loss, claim, damage or liability, or action in respect
thereof, referred to above in this Section 7(d) shall be deemed to include, for
purposes of this Section 7(d), 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 7(d), no
Underwriter shall 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 was offered to the public exceeds the amount of any
damages which such Underwriter has otherwise paid or become liable to pay by
reason of any 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
Underwriters' obligations to contribute as provided in this Section 7(d) are
several in proportion to their respective underwriting obligations and not
joint.
(e) The Underwriters severally confirm that the statements with
respect to the public offering of the Securities set forth on the cover page of,
and under the caption "Underwriting" in, the Prospectus, together with any other
statements identified in the Terms Agreement, are correct and constitute the
only information furnished in
14
writing to the Company by or on behalf of the Underwriters specifically for
inclusion in the Registration Statement and the Prospectus.
(f) The agreements contained in Sections 4(f), 4(g), 5 and this
Section 7 and the representations and warranties of the Company in Section 2 (as
made as of the date of this Agreement) shall survive the delivery of the
Securities and shall remain in full force and effect, regardless of any
termination or cancellation of the Terms Agreement incorporating the terms of
this Agreement or any investigation made by or on behalf of any indemnified
party.
8. Defaulting Underwriters. If any Underwriter defaults in the
performance of its obligations under a Terms Agreement, the remaining non-
defaulting Underwriters shall be obligated to purchase the Securities which the
defaulting Underwriter agreed but failed to purchase in the respective
proportions which the number of shares or principal amount of Securities set
opposite the name of each remaining non-defaulting Underwriter in Schedule A to
the Terms Agreement bears to the total number of shares or principal amount of
the Securities set opposite the names of all the remaining non-defaulting
Underwriters in Schedule A to the Terms Agreement; provided, however, that the
remaining non-defaulting Underwriters shall not be obligated to purchase any
Securities on the Closing Date if the aggregate number of shares or principal
amount of the Securities which the defaulting Underwriter or Underwriters agreed
but failed to purchase on such date exceeds 9.09% of the total number of shares
or principal amount of the Securities, and any remaining non-defaulting
Underwriter shall not be obligated to purchase more than 110% of the number of
shares or principal amount of Securities set forth opposite its name on Schedule
A to the Terms Agreement. If the foregoing maximums are exceeded, the remaining
non-defaulting Underwriters, or those other underwriters satisfactory to the
Representatives who so agree, shall have the right, but shall not be obligated,
to purchase, in such proportion as may be agreed upon among them, all the
Securities. If the remaining Underwriters or other underwriters satisfactory to
the Representatives do not elect to purchase the number of shares or principal
amount which the defaulting Underwriter or Underwriters agreed but failed to
purchase, the Terms Agreement shall terminate without liability on the part of
any non-defaulting Underwriter or the Company, except that the Company will
continue to be liable for the payment of expenses to the extent set forth in
Sections 5 and 10.
Nothing contained herein shall relieve a defaulting Underwriter of any
liability it may have to the Company for damages caused by its default. If
other underwriters are obligated or agree to purchase the Securities of a
defaulting or withdrawing Underwriter, either the Representatives or the Company
may postpone the Closing Date for up to seven full business days in order to
effect any changes that in the opinion of counsel for the Company or counsel for
the Underwriters may be necessary in the Registration Statement, the Prospectus
or any supplement thereto or in any other document or arrangement.
9. Effective Date and Termination. The obligations of the
Underwriters under the Terms Agreement may be terminated by the Representatives
by notice given to and received by the Company prior to delivery of any payment
for the Securities if, prior to that time, the events described in any of
Section 6(h), 6(i) or 6(j) shall have occurred.
10. Reimbursement of Underwriters' Expenses. If the Underwriters
shall decline to purchase the Securities for any reason permitted under Section
6 or Section 9 of this Agreement, the Company shall reimburse the Underwriters
for the reasonable fees and expenses of their counsel and for such other out-of-
pocket expenses as shall have been reasonably incurred by them in connection
with the Terms Agreement and the proposed purchase of the Securities, and upon
demand the Company shall pay the full amount thereof to the Representatives.
11. Notices, etc. All statements, requests, notices and agreements
hereunder shall be in writing and shall be deemed duly given if mailed or
transmitted by any standard form of telecommunication. Such notices shall be
directed as follows:
(a) if to the Underwriters, to their addresses furnished to the
Company in writing for the purpose of communications hereunder;
(b) if to the Company, to the address of the Company set forth in the
Registration Statement, Attention: General Counsel;
15
provided, however, that any notice to an Underwriter pursuant to Section 7(c)
shall be given to such Underwriter at its address set forth in its acceptance
telex to the Representatives, which address will be supplied to any other party
hereto by the Representatives upon request. Any such statements, requests,
notices or agreements shall take effect at the time of receipt thereof.
12. Persons Entitled to Benefit of Agreement. The Terms Agreement
(including the provisions of this Agreement) shall inure to the benefit of and
be binding upon the Underwriters and the Company and their respective
successors. The Terms Agreement (including the provisions of this Agreement)
are for the sole benefit of only those persons, except that (A) the
representations, warranties, indemnities and agreements of the Company contained
in this Agreement also shall be deemed to be for the benefit of the person or
persons, if any, who control any Underwriter within the meaning of Section 15 of
the Securities Act and (B) the indemnity agreement of the Underwriters contained
in Section 7(b) of this Agreement shall be deemed to be for the benefit of
directors of the Company, officers of the Company who have signed the
Registration Statement and any person controlling the Company within the meaning
of Section 15 of the Securities Act. Nothing in this Agreement is intended or
shall be construed to give any person, other than the persons referred to in
this Section 12, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision contained in this Agreement. No
purchaser of Securities from any Underwriter shall be deemed to be a successor
solely by reason of such purchase.
13. Definition of the Term "Business Day". For purposes of this
Agreement, "business day" means any day on which the NYSE is open for trading.
14. Governing Law. This Agreement and the Terms Agreement shall be
governed by and construed in accordance with the laws of New York (without
giving effect to the principles of choice of law).
15. Counterparts. The Terms Agreement may be executed in
counterparts and each such counterpart shall be deemed to be an original but all
such counterparts shall together constitute one and the same instrument.
16. Headings. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
16
ANNEX I
(Three copies of this Delayed Delivery Contract should be signed and returned to
the address shown below so as to arrive not later than 9:00 A.M., New York time,
on _______________ __, 20__ *.)
DELAYED DELIVERY CONTRACT
-------------------------
[Insert date of
initial public
offering]
FIRST DATA CORPORATION
c/o [Name and address
of Underwriter[s]]
Gentlemen:
The undersigned hereby agrees to purchase from FIRST DATA CORPORATION,
a Delaware corporation ("Company"), and the Company agrees to sell to the
undersigned, [If one delayed closing, insert---as of the date hereof, for
------------------------------
delivery on __________________, 20__ ("Delivery Date"),]
[$] __________
principal amount of the Company's [Insert title of securities] ("Securities"),
--------------------------
offered by the Company's Prospectus dated _________, 20__ and a Prospectus
Supplement dated _________, 20__, relating thereto, receipt of copies of which
is hereby acknowledged, at __% of the principal amount thereof plus accrued
interest from __________, 20__, if any, and on the further terms and conditions
set forth in this Delayed Delivery Contract ("Contract").
[If two or more delayed closings, insert the following:
-----------------------------------------------------
The undersigned will purchase from the Company as of the date hereof,
for delivery on the dates set forth below, Securities in the principal amounts
set forth below:
Delivery Date Principal Amount
------------- ----------------
_____________ [$]_______
_____________
[$]_______
Each of such delivery dates is hereinafter referred to as a Delivery Date.]
Payment for the Securities that the undersigned has agreed to purchase
for delivery on [the] [each] Delivery Date shall be made to the Company or its
order by wire transfer of immediately available funds at the office of
_____________________ at 10:00 A.M. on the Delivery Date upon delivery to the
undersigned of the Securities to be purchased by the undersigned for delivery on
such Delivery Date in definitive fully registered form and in such denominations
and registered in such names as the undersigned may designate by written or
telegraphic communication addressed to the Company not less than five full
business days prior to such Delivery Date.
_____________________
* Insert date which is third full business day prior to Closing Date under
the Terms Agreement.
17
It is expressly agreed that the provisions for delayed delivery and
payment are for the sole convenience of the undersigned; that the purchase
hereunder of Securities is to be regarded in all respects as a purchase as of
the date of this Contract; that the obligation of the Company to make delivery
of and accept payment for, and the obligation of the undersigned to take
delivery of and make payment for, Securities on [ the] [each] Delivery Date
shall be subject only to the conditions that (1) investment in the Securities
shall not at -such Delivery Date be prohibited under the laws of any
jurisdiction in the United States to which the undersigned is subject and (2)
the Company shall have sold to the Underwriters the total principal amount of
the Securities less the principal amount thereof covered by this and other
similar Contracts. The undersigned represents that its investment in the
Securities is not, as of the date hereof, prohibited under the laws of any
jurisdiction to which the undersigned is subject and which governs such
investment.
Promptly after completion of the sale to the Underwriters the Company
will mail or deliver to the undersigned at its address set forth below, notice
to such effect, accompanied by a copy of the opinion of counsel for the Company
delivered to the Underwriters in connection therewith.
This Contract will inure to the benefit of and be binding upon the
parties hereto and their respective successors, but will not be assignable by
either party hereto without the written consent of the other.
It is understood that the acceptance of any such Contract is in the
Company's sole discretion and, without limiting the foregoing, need not be on a
first-come, first-served basis. If this Contract is acceptable to the Company,
it is requested that the Company sign the form of acceptance below and mail or
deliver one of the counterparts hereof to the undersigned at its address set
forth below. This will become a binding contract between the Company and the
undersigned when such counterpart is so mailed or delivered.
Yours very truly,
__________________________
(Name of purchaser)
By _______________________
(Title of Signatory)
__________________________
__________________________
(Address of Purchaser)
Accepted, as of the above date,
FIRST DATA CORPORATION
By _____________________________
Name:
Title:
18
ANNEX II (A)
FIRST DATA CORPORATION
("Company")
Debt Securities
TERMS AGREEMENT
---------------
, 20__
First Data Corporation
[address]
Attention:
Ladies and Gentlemen:
[On behalf of the several Underwriters named in Schedule A hereto and
for their respective accounts, we] [We] offer to purchase, on and subject to the
terms and conditions of the Underwriting Agreement Basic Provisions of the
Company attached hereto (the "Underwriting Agreement"), the following securities
("Securities") to be issued under an indenture, dated ________, 20__, between
the Company and _______________, as Trustee, on the following terms:
Title: [ %] [Floating Rate] [Senior] [Subordinated] [Notes] [Debentures]
-----
Due
Principal Amount: [$]
----------------
Interest: [ % per annum, from , 20 , payable semiannually on
--------
and commencing , 20 , to holders of record on the preceding
or , as the case may be.] [Zero coupon]
Maturity: , 20 .
--------
Optional Redemption:
-------------------
Sinking Fund:
------------
Period Designated Pursuant to Section 4(g) of the Underwriting Agreement:
------------------------------------------------------------------------
__ years.
Period Designated Pursuant to Section 4(i) of the Underwriting Agreement:
------------------------------------------------------------------------
__ days.
[Conversion Provisions]:
---------------------
[Other Terms]
Delayed Delivery contracts: [None.] [Delivery Date[s] shall be
--------------------------
, 20 . Underwriters' fee is % of the principal amount of the Contract
Securities.]
Purchase Price: % of principal amount, plus accrued interest [, if any,]
--------------
from ___________, 20__.
Expected Reoffering Price: % of principal amount, subject to change by
-------------------------
the undersigned.
Closing Date: A.M. on , 20 , at ____________________
------------
by wire transfer of immediately available funds.
19
[Name[s] and Address[es] of Representative[s]:]
--------------------------------------------
The respective principal amounts of the Securities to be purchased by each of
the Underwriters are set forth opposite their names in Schedule A hereto.
[If appropriate, insert--It is understood that we may, with your
----------------------
consent, amend this offer to add additional Underwriters and reduce the
aggregate principal amount to be purchased by the Underwriters listed in
Schedule A hereto by the aggregate principal amount to be purchased by such
additional Underwriters.]
The significant subsidiaries (as defined in Rule 405 under the
Securities Act of 1933) of the Company are as follows:
The provisions of the Underwriting Agreement, other than Sections 2(f)
and 2(n), are incorporated herein by reference.
Delivery of the Securities will be made through the facilities of the
Depository Trust Company.
[Please signify your acceptance of our offer by signing the enclosed
response to us in the space provided and returning it to us.]
[Please signify your acceptance of the foregoing by return wire not
later than P.M. today.]
Very truly yours,
[Insert name(s) of Representatives
or Underwriters] [On behalf of [themselves][itself] and as
Representative[s] of the Several]
[As] Underwriters[s]
[By [Name of Representative]]
By________________________
Name:
Title:
20
SCHEDULE A
Principal
Underwriter Amount
----------- ------
------
Total......................................... [$]
21
SCHEDULE B
22
SCHEDULE C
To: [Insert name(s) of Representatives
or Underwriters]
As [Representative[s] of the Several]
Underwriter[s],
[c/o [Name of Representative]]
We accept the offer contained in your [letter] [wire],
dated, 20 , relating to [$]__________principal amount of our [Insert title of
---------------
Securities] (the "Terms Agreement"). We also confirm that, to the best of our
----------
knowledge after reasonable investigation, the representations and warranties of
the undersigned contained in Section 2 of the Underwriting Agreement Basic
Provisions of the Company referred to in the Terms Agreement (together with the
Terms Agreement, the "Underwriting Agreement"), are true and correct, no stop
order suspending the effectiveness of the Registration Statement (as defined in
the Underwriting Agreement) or of any part thereof has been issued and no
proceedings for that purpose have been instituted or, to the knowledge of the
undersigned, are contemplated by the Securities and Exchange Commission and,
subsequent to the respective dates of the most recent financial statements in
the Prospectus (as defined in the Underwriting Agreement), there has been (or in
the case of a form of prospectus filed pursuant to Rule 424(b)(2) or (5) there
will be, as of the date of such prospectus) no material adverse change in the
financial position or results of operations of the undersigned and its
subsidiaries except as set forth in or contemplated by the Prospectus.
Very truly yours,
FIRST DATA CORPORATION
By_____________________
Name:
Title:
23
ANNEX II (B)
FIRST DATA CORPORATION
("Company")
Equity Securities
TERMS AGREEMENT
---------------
, 20__
First Data Corporation
[address]
Attention:
Ladies and Gentlemen:
[On behalf of the several Underwriters named in Schedule A hereto and
for their respective accounts, we] [We] offer to purchase, on and subject to the
terms and conditions of the Underwriting Agreement Basic Provisions of the
Company attached hereto (the "Underwriting Agreement"), the following securities
("Securities") on the following terms:
Title: [Common Stock] [Preferred Stock, Series ______]
-----
Number of Shares to be issued: [______ shares]
-----------------------------
[For Preferred Stock:
Voting Rights:
-------------
Preferred Stock Dividends: [cash dividends of $ to $ per share payable
-------------------------
quarterly in arrears on _____ __, ______ __, _______ __ and _______ __.]
Optional Redemption:
-------------------
Mandatory Redemption/Sinking Fund:
---------------------------------
Liquidation Preference: [$ per share plus ].
----------------------
Name of Exchange or Market: [New York Stock Exchange] [NASDAQ National
--------------------------
Market System] [American Stock Exchange]
Period Designated Pursuant to Section 4(g) of the Underwriting Agreement:
------------------------------------------------------------------------
___ years.
Period Designated Pursuant to Section 4(i) of the Underwriting Agreement:
------------------------------------------------------------------------
___ days.
[Conversion Provisions]:
---------------------
[Other Terms]
Price to Public: $________ per share
---------------
Underwriting Discounts and Commission:
-------------------------------------
24
Proceeds to Company:
-------------------
Over-Allotment Option:
---------------------
Closing Date: A.M. on , 20 , at _____________________ by
------------
wire transfer of immediately available funds.
Name of Transfer Agent and Registrar:
------------------------------------
[Name[s] and Address[es] of Representative[s]:]]
--------------------------------------------
[For Common Stock:
Name of Exchange or Market: [New York Stock Exchange] [NASDAQ National
--------------------------
Market System] [American Stock Exchange]
Period Designated Pursuant to Section 4(g) of the Underwriting Agreement:
------------------------------------------------------------------------
___ years.
Period Designated Pursuant to Section 4(i) of the Underwriting Agreement:
-------------------------------------------------------------------------
___days.
[Other Terms]
Price to Public: $______________ per share
---------------
Underwriting Discounts and Commission:
-------------------------------------
Proceeds to Company:
-------------------
Over-Allotment Option:
---------------------
Closing Date: A.M. on , 20 , at _____________________ by
------------
wire transfer of immediately available funds.
Name of Transfer Agent and Registrar:
------------------------------------
[Name[s] and Address[es] of Representative[s]:]]
--------------------------------------------
The respective shares of the Securities to be purchased by each of the
Underwriters are set forth opposite their names in Schedule A hereto.
[If appropriate, insert--It is understood that we may, with your consent,
----------------------
amend this offer to add additional Underwriters and reduce the number of shares
to be purchased by the Underwriters listed in Schedule A hereto by the number of
shares to be purchased by such additional Underwriters.]
The significant subsidiaries (as defined in Rule 405 under the
Securities Act of 1933) of the Company are as follows:
The provisions of the Underwriting Agreement are incorporated herein
by reference.
Delivery of the Securities will be made through the facilities of the
Depository Trust Company.
25
[Please signify your acceptance of our offer by signing the enclosed
response to us in the space provided and returning it to us.]
[Please signify your acceptance of the foregoing by return wire not
later than P.M. today.]
Very truly yours,
[Insert name(s) of Representatives
or Underwriters] [On behalf of [themselves][itself] and as
Representative[s] of the Several]
[As] Underwriters[s]
[By [Name of Representative]]
By______________________
Name:
Title:
26
SCHEDULE A
Number of
Underwriter Shares
----------- ------
---------
Total........................................... [$]
=========
27
SCHEDULE B
28
SCHEDULE C
To: [Insert name(s) of Representatives
or Underwriters]
As [Representative[s] of the Several]
Underwriter[s],
[c/o [Name of Representative]]
We accept the offer contained in your [letter] [wire],
dated, 20 , relating to ____________ shares of our [Insert title of Securities]
--------------------------
(the "Terms Agreement"). We also confirm that, to the best of our knowledge
after reasonable investigation, the representations and warranties of the
undersigned contained in Section 2 of the Underwriting Agreement Basic
Provisions of the Company referred to in the Terms Agreement (together with the
Terms Agreement, the "Underwriting Agreement"), are true and correct, no stop
order suspending the effectiveness of the Registration Statement (as defined in
the Underwriting Agreement) or of any part thereof has been issued and no
proceedings for that purpose have been instituted or, to the knowledge of the
undersigned, are contemplated by the Securities and Exchange Commission and,
subsequent to the respective dates of the most recent financial statements in
the Prospectus (as defined in the Underwriting Agreement), there has been (or in
the case of a form of prospectus filed pursuant to Rule 424(b)(2) or (5) there
will be, as of the date of such prospectus) no material adverse change in the
financial position or results of operations of the undersigned and its
subsidiaries except as set forth in or contemplated by the Prospectus.
Very truly yours,
FIRST DATA CORPORATION
By________________________
Name:
Title:
29
