Solutia Inc. UNDERWRITING AGREEMENT
EXHIBIT
1.1
$400,000,000
8.75%
Senior Notes due 2017
October
9, 2009
Deutsche
Bank Securities Inc.
As
Representative of the
Several
Underwriters named in Schedule I hereto
00 Xxxx
Xxxxxx, 0xx Xxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Ladies
and Gentlemen:
Solutia
Inc., a Delaware corporation (the “Company”), proposes
to issue and sell to the several underwriters (the “Underwriters”) named
in Schedule I hereto for whom you are acting as representative (the “Representative”)
$400,000,000 aggregate principal amount of its 8.75% Senior Notes due 2017 (the
“Notes”). The
respective principal amounts of the Notes to be so purchased by the several
Underwriters are set forth opposite their names in Schedule I
hereto. The Notes are to be issued under an indenture (the “Indenture”) to be
dated as of October 15, 2009, by and among the Company, the guarantors party
thereto listed on Schedule II hereto (the “Guarantors” and,
together with the Company, the “Issuers”) and The
Bank of New York Mellon Trust Company, as Trustee (the “Trustee”). The
Company’s obligations under the Notes and the Indenture will be fully and
unconditionally guaranteed, jointly and severally (the “Guarantees”), by each
of the Guarantors; any reference herein to the Notes shall include a reference
to the related Guarantees.
As the
Representative, you have advised the Company (a) that you are authorized to
enter into this Agreement on behalf of the several Underwriters, and
(b) that the several Underwriters are willing, acting severally and not
jointly, to purchase the principal amount of Notes set forth opposite their
respective names in Schedule I.
In
consideration of the mutual agreements contained herein and of the interests of
the parties in the transactions contemplated hereby, the parties hereto agree as
follows:
1. Representations and
Warranties of the Company.
The
Issuers, jointly and severally, represent and warrant to each of the
Underwriters as follows:
(a) An
“automatic shelf registration statement” as defined in Rule 405 under the
Securities Act of 1933, as amended (the “Act”), on Form S-3
(File No. 333-160834) in respect of the Notes, including a form of
prospectus (the “Base
Prospectus”), has been prepared and filed by the Company not earlier than
three years prior to the date hereof, in conformity with the requirements of the
Act and the rules and regulations (the “Rules and Regulations”) of
the
Securities and Exchange Commission (the “Commission”)
thereunder. By a post-effective amendment dated October 5, 2009, the
Company has added the Guarantors as additional registrants and the Guarantees as
an additional class of securities to the Registration Statement. The
Issuers and the transactions contemplated by this Agreement meet the
requirements of, and comply with the conditions for the use of, Form S-3 under
the Act. Such registration statement, which shall be deemed to
include all information omitted therefrom in reliance upon Rules 430A, 430B or
430C under the Act, is herein referred to as the “Registration
Statement.” The Registration Statement became effective upon
filing under Rule 462(e) under the Act on July 27, 2009. If the
Issuers have filed a post-effective amendment pursuant to Rules 413(b) and
462(e) under the Act, then any reference herein to the term “Registration
Statement” shall be deemed to include such post-effective
amendment. As used herein, the term “Prospectus” means the
form of prospectus relating to the Notes first filed with the Commission
pursuant to and within the time limits described in Rule 424(b) under the Act
and in accordance with Section 4(a) hereof. The Base Prospectus,
as supplemented by each preliminary prospectus (including any preliminary
prospectus supplement) relating to the Notes filed with the Commission pursuant
to Rule 424(b) under the Act, including the documents incorporated by reference
in the Base Prospectus is herein referred to as a “Preliminary
Prospectus.” Any reference herein to the Registration
Statement, any Preliminary Prospectus or to the Prospectus or to any amendment
or supplement to any of the foregoing documents shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to Item 12 of
Form S-3 under the Act, as of the effective date of the Registration Statement
or the date of such Preliminary Prospectus or the Prospectus, as the case may
be, and any reference to “amend,” “amendment” or supplement with respect to the
Registration Statement, any Preliminary Prospectus or the Prospectus shall be
deemed to include any documents incorporated by reference therein, and any
supplements or amendments thereto, filed with the Commission after the date of
filing of the Prospectus under Rule 424(b) under the Act, and prior to the
termination of the offering of the Notes by the Underwriters.
(b) As of the
Applicable Time (as defined below) and as of the Closing Date, neither
(i) the General Use Free Writing Prospectus(es) (as defined below) and
Preliminary Prospectus (as defined below) (collectively, the “General Disclosure
Package”) nor (ii) any individual Limited Use Free Writing
Prospectus (as defined below), when considered together with the Preliminary
Prospectus accompanying, or delivered prior to delivery of, such Limited Use
Free Writing Prospectus, included or will include any untrue statement of a
material fact or omitted or will 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; provided, however, that the
Issuers make no representations or warranties as to information contained in or
omitted from any Issuer Free Writing Prospectus, in reliance upon, and in
conformity with, written information furnished to the Company by or on behalf of
any Underwriter through the Representative, specifically for use therein, it
being understood and agreed that the only such information is that described in
Section 12. As used in this Agreement:
“Applicable Time”
means 8:30am (Eastern time) on the date of this Agreement.
“Issuer Free Writing
Prospectus” means any “issuer free writing prospectus,” as defined in
Rule 433 under the Act, relating to the Notes in the form filed or required to
be filed
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“General Use Free Writing
Prospectus” means any Issuer Free Writing Prospectus that is identified
on Schedule III to this Agreement.
“Limited Use Free Writing
Prospectus” means any Issuer Free Writing Prospectus that is not a
General Use Free Writing Prospectus.
(c) Each
Issuer has been duly organized and is validly existing as a corporation in good
standing under the laws of its jurisdiction of organization, with corporate
power and authority to own or lease its properties and conduct its business as
described in the Registration Statement, the General Disclosure Package and the
Prospectus. The Company does not own or control, directly or
indirectly, any corporation, association or other entity other than the
subsidiaries listed in Exhibit 21 to the Registration Statement (the “Subsidiaries”). Each
of the Subsidiaries has been duly organized and is validly existing as an entity
and in good standing under the laws of the jurisdiction of its incorporation or
organization, with all requisite power and authority to own or lease its
properties and conduct its business as described in the Registration Statement,
the General Disclosure Package and the Prospectus except with respect to
Subsidiaries that are not Guarantors, to the extent that the failure to be so
qualified or be in good standing would not, individually or in the aggregate,
have a Material Adverse Effect (as defined below). The Company and
each of the Subsidiaries are duly qualified to transact business in all
jurisdictions in which the conduct of their business requires such
qualification, except with respect to Subsidiaries that are not Guarantors,
where the failure to be so qualified would not, individually or in the
aggregate, have a Material Adverse Effect. The outstanding shares of
capital stock or ownership interests of each of the Subsidiaries have been duly
authorized and validly issued, are fully paid and non-assessable and are owned
by the Company or another Subsidiary free and clear of all liens, encumbrances
and equities and claims; and no options, warrants or other rights to purchase,
agreements or other obligations to issue or other rights to convert any
obligations into shares of capital stock or ownership interests in the
Subsidiaries are outstanding.
(d) The
Company has an authorized capitalization set forth under the caption
“Capitalization” in the Registration Statement, the Preliminary Prospectus and
the Prospectus (and any similar section or information contained in the General
Disclosure Package). The outstanding shares of common stock of the
Company have been duly authorized and validly issued and are fully paid and
non-assessable; and no preemptive rights of stockholders exist with respect to
any of the Notes or the issue and sale thereof.
(e) The
Commission has not issued an order preventing or suspending the use of the
Registration Statement, any Preliminary Prospectus, any Issuer Free Writing
Prospectus or the Prospectus relating to the proposed offering of the Notes, and
no proceeding for that purpose or pursuant to Section 8A of the Act has
been instituted or, to the Company’s knowledge, threatened by the
Commission. The Registration Statement contains, and the Prospectus
and any amendments or supplements thereto will contain, all statements which are
required to be stated therein by, and will conform to, the requirements of the
Act, the Trust Indenture Act and the Rules and Regulations. The
documents incorporated, or to be incorporated, by refer-
3
ence in
the Prospectus, at the time filed with the Commission conformed or will conform
to the requirements of the Securities Exchange Act of 1934, as amended, and the
rules and regulations of the Commission thereunder (collectively, the “Exchange
Act”). The Registration Statement and any amendment thereto do
not contain, and will not contain, any untrue statement of a material fact and
do not omit, and will not omit, to state a material fact required to be stated
therein or necessary in order to make the statements therein not
misleading. The Prospectus and any amendments and supplements thereto
do not contain, and will not contain, any untrue statement of a material fact,
and do not omit, and will not 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; provided, however, that the Issuers make no
representations or warranties as to information contained in or omitted from the
Registration Statement or the Prospectus, or any such amendment or supplement,
in reliance upon, and in conformity with, written information furnished to the
Company by or on behalf of any Underwriter through the Representative,
specifically for use therein, it being understood and agreed that the only such
information is that described in Section 12.
(f) Each
Issuer Free Writing Prospectus, as of its date and at all subsequent times
through the completion of the public offer and sale of the Notes or until any
earlier date that the Company notified or notifies the Representative as
described in the next sentence, did not, does not and will not include any
information that conflicted, conflicts or will conflict with the information
contained in the Registration Statement, any Preliminary Prospectus not
superseded or modified or the Prospectus, including any document incorporated by
reference and any Prospectus Supplement deemed to be a part thereof that has not
been superseded or modified.
(g) The
Issuers have not, directly or indirectly, distributed and will not distribute
any offering material in connection with the offering and sale of the Notes
other than any Preliminary Prospectus, the Prospectus, the General Use Free
Writing Prospectus(es) and each Limited Use Free Writing Prospectus approved in
writing in advance by the Representative and other materials, if any, permitted
under the Act and consistent with Section 4(b) below. To the
extent it is required to do so, the Company will file with the Commission all
Issuer Free Writing Prospectuses in the time and manner required under Rules
163(b)(2) and 433(d) under the Act.
(h) (i) At
the time of filing the Registration Statement, (ii) at the time of the most
recent amendment thereto for the purposes of complying with
Section 10(a)(3) under the Act (whether such amendment was by
post-effective amendment, incorporated report filed pursuant to Section 13
or 15(d) of the Exchange Act or form of prospectus), and (iii) at the time the
Issuers or any person acting on their behalf (within the meaning, for this
clause only, of Rule 163(c) under the Act) made any offer relating to the Notes
in reliance on the exemption of Rule 163 under the Act and (iv) at the date
hereof, the Company is a “well-known seasoned issuer” as defined in Rule 405
under the Act. The Company has not received from the Commission any
notice pursuant to Rule 401(g)(2) under the Act objecting to the use of the
automatic shelf registration form.
(i) (i) At
the earliest time after the filing the Registration Statement that the Issuers
or another offering participant made a bona fide offer (within the
meaning of Rule
4
164(h)(2)
under the Act) of the Notes and (ii) as of the date hereof (with such date being
used as the determination date for purposes of this clause (ii)), none of the
Issuers was or is an “ineligible issuer” (as defined in Rule 405 under the Act,
without taking into account any determination by the Commission pursuant to Rule
405 under the Act that it is not necessary that any such Issuer be considered an
ineligible issuer), including, without limitation, for purposes of Rules 164 and
433 under the Act with respect to the offering of the Notes as contemplated by
the Registration Statement.
(j) The
financial statements of the Company and its consolidated Subsidiaries, together
with related notes and schedules as set forth or incorporated by reference in
the Registration Statement, the General Disclosure Package and the Prospectus,
present fairly the financial position and the results of operations and cash
flows of the Company and the consolidated Subsidiaries, at the indicated dates
and for the indicated periods. Such financial statements and related
schedules have been prepared in accordance with generally accepted principles of
accounting (“GAAP”), consistently
applied throughout the periods involved, except as disclosed therein, and all
adjustments necessary for a fair presentation of results for such periods have
been made. The summary and selected consolidated financial and
statistical data included or incorporated by reference in the Registration
Statement, the General Disclosure Package and the Prospectus presents fairly in
all material respects the information shown therein and such data has been
compiled on a basis consistent with the financial statements presented therein
and the books and records of the Company. All disclosures contained
in the Registration Statement, the General Disclosure Package and the Prospectus
regarding “non-GAAP financial measures” (as such term is defined by the Rules
and Regulations) comply with Regulation G of the Exchange Act and Item 10 of
Regulation S-K under the Act, to the extent applicable. The Company
and the Subsidiaries do not have any material liabilities or obligations, direct
or contingent (including any off-balance sheet obligations or any “variable
interest entities” within the meaning of Financial Accounting Standards Board
Interpretation No. 46), not disclosed in the Registration Statement, the
General Disclosure Package and the Prospectus. There are no financial
statements (historical or pro forma) that are required to be included in the
Registration Statement, the General Disclosure Package or the Prospectus that
are not included as required.
(k) Deloitte
& Touche LLP, who have certified certain of the financial statements filed
with the Commission as part of, or incorporated by reference in, the
Registration Statement, the General Disclosure Package and the Prospectus, is an
independent registered public accounting firm with respect to the Company and
the Subsidiaries within the meaning of the Act and the applicable Rules and
Regulations and the Public Company Accounting Oversight Board (United States)
(the “PCAOB”).
(l) Except as
disclosed in the Registration Statement, the General Disclosure Package and the
Prospectus, neither the Company nor any of the Subsidiaries is aware of
(i) any material weakness in its internal control over financial reporting
or (ii) change in internal control over financial reporting that has materially
affected, or is reasonably likely to materially affect, the Company’s internal
control over financial reporting.
5
(m) Solely to
the extent that the Xxxxxxxx-Xxxxx Act of 2002, as amended, and the rules and
regulations promulgated by the Commission and the New York Stock Exchange
thereunder (the “Xxxxxxxx-Xxxxx Act”)
has been applicable to the Company, there is and has been no failure on the part
of the Company to comply in all material respects with any provision of the
Xxxxxxxx-Xxxxx Act. The Company has taken all necessary actions to
ensure that it is in compliance with all provisions of the Xxxxxxxx-Xxxxx Act
that are in effect and with which the Company is required to
comply.
(n) There is
no action, suit, claim or proceeding pending or, to the knowledge of the
Company, threatened against the Company or any of the Subsidiaries before any
court or administrative agency or otherwise which if determined adversely to the
Company or any of the Subsidiaries would either (i) have, individually or in the
aggregate, a material adverse effect on the earnings, business, management,
properties, assets, rights, operations, condition (financial or otherwise) or
prospects of the Company and of the Subsidiaries taken as a whole or (ii)
prevent the consummation of the transactions contemplated hereby (the occurrence
of any such effect or any such prevention described in the foregoing clauses (i)
and (ii) being referred to as a “Material Adverse
Effect”), except as set forth in the Registration Statement, the General
Disclosure Package and the Prospectus.
(o) The
Company and the Subsidiaries have good and marketable title to all of the
properties and assets reflected in the consolidated financial statements
hereinabove described or described in the Registration Statement, the General
Disclosure Package and the Prospectus, subject to no lien, mortgage, pledge,
charge or encumbrance of any kind except those reflected in such financial
statements or described in the Registration Statement, the General Disclosure
Package and the Prospectus or which would not reasonably be expected to have a
Material Adverse Effect. The Company and the Subsidiaries occupy
their leased properties under valid and binding leases conforming in all
material respects to the description thereof set forth in the Registration
Statement, the General Disclosure Package and the Prospectus.
(p) The
Company and the Subsidiaries have filed all Federal, State, local and foreign
tax returns which have been required to be filed and have paid all taxes
indicated by such returns and all assessments received by them or any of them to
the extent that such taxes have become due and are not being contested in good
faith and for which an adequate reserve for accrual has been established in
accordance with GAAP, except as would not have a Material Adverse
Effect. All material tax liabilities have been adequately provided
for in the financial statements of the Company and its consolidated
Subsidiaries, and the Company does not know of any actual or proposed additional
material tax assessments.
(q) Since the
respective dates as of which information is given in the Registration Statement,
the General Disclosure Package and the Prospectus, as each may be amended or
supplemented, there has not been any Material Adverse Effect, whether or not
occurring in the ordinary course of business, and there has not been any
material transaction entered into or any material transaction that is probable
of being entered into by the Company or the Subsidiaries, other than
transactions in the ordinary course of business and changes and transactions
described in the Registration Statement, the General Disclosure Package and the
Prospectus, as each may be amended or supplemented. The Company and
the Subsidiaries have no material
6
contingent
obligations which are not disclosed in the financial statements of the Company
and its consolidated Subsidiaries which are included in the Registration
Statement, the General Disclosure Package and the Prospectus. Except
as disclosed in the General Disclosure Package and the Prospectus, there are no
outstanding guarantees or other contingent obligations of the Company or any
Subsidiary that could reasonably be expected to have a Material Adverse
Effect.
(r) Neither
the Company nor any of the Subsidiaries is or with the giving of notice or lapse
of time or both, will be, (i) in violation of its certificate or articles of
incorporation, by-laws, certificate of formation, limited liability agreement,
partnership agreement or other organizational documents or (ii) in
violation of or in default under any agreement, lease, contract, indenture or
other instrument or obligation to which it is a party or by which it, or any of
its properties, is bound and, solely with respect to this clause (ii), which
violation or default would, individually or in the aggregate, have a Material
Adverse Effect. The execution and delivery of this Agreement and the
Indenture and the fulfillment of the terms hereof by the Company and, to the
Company’s knowledge, the consummation of the transactions herein contemplated
(including, without limitation, the issuance and sale of the Notes to the
Underwriters) will not conflict with or result in a breach of (i) any of
the terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust or other agreement or instrument to which the Company or
any Subsidiary is a party or by which the Company or any Subsidiary or any of
their respective properties is bound, (ii) the certificate or articles of
incorporation or by-laws of the Company or (iii) any law, order, rule or
regulation judgment, order, writ or decree applicable to the Company or any
Subsidiary of any court or of any government, regulatory body or administrative
agency or other governmental body having jurisdiction, except with respect to
clauses (i) and (iii) to the extent that such conflict, breach or default would
not, individually or in the aggregate, have a Material Adverse
Effect.
(s) The
execution and delivery of, and the performance by the Company and each Guarantor
of its obligations under, this Agreement has been duly and validly authorized by
all necessary corporate action on the part of the Company and each Guarantor,
and this Agreement has been duly executed and delivered by the Company and each
Guarantor.
(t) The
Company has all requisite corporate power and authority to execute, deliver and
perform each of its obligations under the Notes. The Notes, when
issued, will be in the form contemplated by the Indenture. The Notes
have been duly and validly authorized by the Company and, when executed by the
Company and authenticated by the Trustee in accordance with the provisions of
the Indenture and when delivered to and paid for by the Underwriters in
accordance with the terms of this Agreement, will constitute valid and legally
binding obligations of the Company, entitled to the benefits of the Indenture,
and enforceable against the Company in accordance with their terms, except that
the enforcement thereof may be subject to (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors’ rights generally, and (ii) general principles of
equity and the discretion of the court before which any proceeding therefor may
be brought (collectively, the “Enforceability
Exceptions”).
7
(u) Each
Guarantor has all requisite corporate power and authority to execute, deliver
and perform each of their obligations under the Guarantees. The
Guarantees, when issued, will be in the form contemplated by the
Indenture. The Guarantees have been duly and validly authorized by
each Guarantor and, when executed by each Guarantor and when the Notes are
authenticated by the Trustee in accordance with the provisions of the Indenture
and delivered to and paid for by the Underwriters in accordance with the terms
of this Agreement, the Guarantees will constitute valid and legally binding
obligations of each Guarantor, entitled to the benefits of the Indenture, and
enforceable against each Guarantor in accordance with their terms, except that
the enforcement thereof may be subject to the Enforceability
Exceptions.
(v) The
Company and each Guarantor have all requisite corporate power and authority to
execute, deliver and perform their obligations under the
Indenture. The Indenture has been duly qualified under the Trust
Indenture Act of 1939, as amended (the “Trust Indenture
Act”). The Indenture has been duly and validly authorized by
the Company and each Guarantor and, when executed and delivered by the Company
and each Guarantor (assuming the due authorization, execution and delivery by
the Trustee), will constitute a valid and legally binding agreement of the
Company and each Guarantor, enforceable against the Company and each Guarantor
in accordance with its terms, except that the enforcement thereof may be subject
to the Enforceability Exceptions.
(w) Each
approval, consent, order, authorization, designation, declaration or filing by
or with any regulatory, administrative or other governmental body necessary in
connection with the execution and delivery by the Company of this Agreement and
the consummation of the transactions herein contemplated (except such additional
steps as may be required by the Commission, the Financial Industry Regulatory
Authority, Inc. (“FINRA”) or such
additional steps as may be necessary to qualify the Notes for public offering by
the Underwriters under state securities or “Blue Sky” laws) has been obtained or
made and is in full force and effect.
(x) The
Company and each of the Subsidiaries hold all material licenses, certificates
and permits from governmental authorities which are necessary to the conduct of
their businesses; the Company and the Subsidiaries each own or possess the right
to use all patents, patent rights, trademarks, trade names, service marks,
service names, copyrights, license rights, know-how (including trade secrets and
other unpatented and unpatentable proprietary or confidential information,
systems or procedures) and other intellectual property rights (“Intellectual
Property”) necessary to carry on their business in all material respects;
neither the Company nor any of the Subsidiaries has infringed, and none of the
Company or the Subsidiaries have received notice of conflict with, any
Intellectual Property of any other person or entity. The Company has
taken all reasonable steps necessary to secure interests in such Intellectual
Property from its contractors. There are no outstanding options,
licenses or agreements of any kind relating to the Intellectual Property of the
Company that are required to be described in the Registration Statement, the
General Disclosure Package and the Prospectus and are not described in all
material respects. The Company is not a party to or bound by any
options, licenses or agreements with respect to the Intellectual Property of any
other person or entity that are required to be set forth in the Prospectus and
are not so described in all material respects. None
8
of the
technology employed by the Company has been obtained or is being used by the
Company in violation of any material contractual obligation binding on the
Company or any of its officers, directors or employees or otherwise in violation
of the rights of any persons; the Company has not received any written or oral
communications alleging that the Company has violated, infringed or conflicted
with, or, by conducting its business as set forth in the Registration Statement,
the General Disclosure Package and the Prospectus, would violate, infringe or
conflict with, any of the Intellectual Property of any other person or entity,
except to the extent such violation, infringement or conflict would not,
individually or in the aggregate, have a Material Adverse Effect.
(y) Neither
the Company, nor to the Company’s knowledge, any of its affiliates, has taken or
may take, directly or indirectly, any action designed to cause or result in, or
which has constituted or which might reasonably be expected to constitute, the
stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Notes. The Company acknowledges
that the Underwriters may engage in passive market making transactions in the
Notes in accordance with Regulation M under the Exchange Act.
(z) Neither
the Company nor any Subsidiary is or, after giving effect to the offering and
sale of the Notes contemplated hereunder and the application of the net proceeds
from such sale as described in the Registration Statement, General Disclosure
Package and the Prospectus, will be an “investment company” within the meaning
of such term under the Investment Company Act of 1940, as amended (the “1940 Act”), and the
rules and regulations of the Commission thereunder.
(aa) The
Company and each of the Subsidiaries maintains a system of internal accounting
controls sufficient to provide reasonable assurances that (i) transactions are
executed in accordance with management’s general or specific authorization; (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with GAAP and to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management’s general
or specific authorization; and (iv) the recorded accountability for assets is
compared with existing assets at reasonable intervals and appropriate action is
taken with respect to any differences.
(bb) The
Company has established and maintains an effective system of “disclosure
controls and procedures” (as defined in Rules 13a-14(c) and 15d-14(c) under the
Exchange Act) that complies with the requirements of the Exchange Act; the
Company’s “disclosure controls and procedures” are reasonably designed to ensure
that all information (both financial and non-financial) required to be disclosed
by the Company in the reports that it files or submits under the Exchange Act is
recorded, processed, summarized and reported within the time periods specified
in the rules and regulation of the Exchange Act, and that all such information
is accumulated and communicated to the Company’s management as appropriate to
allow timely decisions regarding required disclosure and to make the
certifications of the Chief Executive Officer and Chief Financial Officer of the
Company required under the Exchange Act with respect to such
reports.
(cc) The
statistical and market-related data included in the Registration Statement, the
General Disclosure Package and the Prospectus are based on or derived
from
9
sources
which the Company reasonably and in good faith believes are reliable and
accurate, and such data agree with the sources from which they are
derived.
(dd) The
operations of the Company and its Subsidiaries are and have been conducted at
all times in compliance with applicable financial record-keeping and reporting
requirements of the Currency and Foreign Transactions Reporting Act of 1970, as
amended, applicable money laundering statutes and applicable rules and
regulations thereunder (collectively, the “Money Laundering
Laws”), and no action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the Company
or any or its subsidiaries with respect to the Money Laundering Laws is pending
or, to the Company’s knowledge, threatened.
(ee) Neither
the Company nor any of its Subsidiaries nor, to the Company’s knowledge, any
director, officer, agent, employee or affiliate of the Company or any of its
Subsidiaries is currently subject to any U.S. sanctions administered by the
Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”); and the
Company will not directly or indirectly use the proceeds of the offering, or
lend, contribute or otherwise make available such proceeds to any subsidiary,
joint venture partner or other person or entity, for the purpose of financing
the activities of any person currently subject to any U.S. sanctions
administered by OFAC.
(ff) The
Company and each of the Subsidiaries carry, or are covered by, insurance in such
amounts and covering such risks as the Company reasonably deems adequate for the
conduct of their respective businesses and the value of their respective
properties and as is customary for companies engaged in similar businesses in
similar industries.
(gg) Except as
disclosed in the Registration Statement, the General Disclosure Package and the
Prospectus, the Company and each Subsidiary is in compliance in all material
respects with all presently applicable provisions of the Employee Retirement
Income Security Act of 1974, as amended, including the regulations and published
interpretations thereunder (“ERISA”); no
“reportable event” (as defined in ERISA) has occurred with respect to any
“pension plan” (as defined in ERISA) for which the Company and each Subsidiary
would have any liability; the Company and each Subsidiary has not incurred and
do not expect to incur liability under (i) Title IV of ERISA with respect to
termination of, or withdrawal from, any “pension plan” or (ii) Sections 412 or
4971 of the Internal Revenue Code of 1986, as amended, including the regulations
and published interpretations thereunder (the “Code”); and each
“pension plan” for which the Company or any Subsidiary would have any liability
that is intended to be qualified under Section 401(a) of the Code is so
qualified in all material respects and nothing has occurred, whether by action
or by failure to act, which would cause the loss of such
qualification.
(hh) Neither
the Company nor any of the Subsidiaries is in violation of any statute, rule,
regulation, decision or order of any governmental agency or body or any court,
domestic or foreign, relating to the use, disposal or release of hazardous or
toxic substances or relating to the protection or restoration of the environment
or human exposure to hazardous or toxic substances (collectively, “environmental laws”),
owns or operates any real property contaminated with any substance that is
subject to environmental laws, is liable for any off-site disposal or
contamination pursuant to any environmental laws, or is subject to any claim
relating
10
to any
environmental laws, which violation, contamination, liability or claim would,
individually or in the aggregate, have a Material Adverse Effect; and the
Company is not aware of any pending investigation which could reasonably be
expected to lead to such a claim.
(ii) There are
no relationships or related-party transactions involving the Company or any of
the Subsidiaries or any other person required to be described in the Prospectus
which have not been described as required.
(jj) Neither
the Company nor any of the Subsidiaries has made any contribution or other
payment to any official of, or candidate for, any federal, state or foreign
office in violation of any law which violation is required to be disclosed in
the Registration Statement, the General Disclosure Package or the
Prospectus.
(kk) There is
no document, contract or other agreement required to be described in the
Registration Statement or Prospectus or to be filed as an exhibit to the
Registration Statement which is not described or filed as required by the Act or
the Rules and Regulations. Each description of a contract, document
or other agreement in the Registration Statement and the Prospectus accurately
reflects in all material respects the terms of the underlying contract, document
or other agreement.
(ll) Except
for this Agreement, neither the Company nor any of its Subsidiaries is a party
to any contract, agreement or understanding with any person that would give rise
to a valid claim against the Company or the Underwriters for a brokerage
commission, finder’s fee or like payment in connection with the offering and
sale of the Notes.
(mm) The Fifth
Amended Joint Plan of Reorganization under Chapter 11 of the United States
Bankruptcy Code (the “Plan of
Reorganization”) of the Company and its Subsidiaries named therein
(collectively, the “Reorganizing
Debtors”) was confirmed by order of the United States Bankruptcy Court
for the Southern District of New York entered on November 29, 2007, and no party
has appealed such confirmation order or moved for revocation or reconsideration
thereof. The Effective Date (as defined in the Plan of
Reorganization) occurred on February 28, 2008 . Except as provided in
the Plan of Reorganization, all Claims (as defined in the Plan of
Reorganization) against the Reorganizing Debtors have been discharged in
full. Except as provided in the Plan of Reorganization, all Equity
Interests (as defined in the Plan of Reorganization) of the Company have been
cancelled or discharged in full. Neither the Company nor any of its
Subsidiaries is currently, or has in the past been, in default in any material
respect, and no event has occurred which, with notice or lapse of time or both,
would constitute such a default, in the due performance or observance of any
material term, covenant or condition contained in the Plan of
Reorganization. There is no legal or governmental proceeding relating
to the Plan of Reorganization to which the Company or any of its Subsidiaries is
a party or of which any property or assets of the Company or any of its
Subsidiaries are the subject; and to the best of the Company’s knowledge, no
such proceedings are threatened or contemplated by any governmental authorities
or threatened by others.
(nn) No
Subsidiary of the Company is currently prohibited, directly or indirectly, from
paying any dividends to the Company, from making any other distribution on such
Subsidiary’s capital stock, from repaying to the Company any loans or advances
to such Sub-
11
sidiary
from the Company or from transferring any of such Subsidiary’s property or
assets to the Company or any other Subsidiary of the Company.
(oo) The
Notes, the Guarantees and the Indenture will conform in all material respects to
the descriptions thereof in the Prospectus and the General Disclosure Package
and will be in substantially the respective forms filed or incorporated by
reference, as the case may be, as exhibits to the Registration
Statement.
2. Purchase, Sale and Delivery
of the Notes.
On the
basis of the representations, warranties, agreements and covenants herein
contained and subject to the terms and conditions herein set forth, the Company
agrees to issue and sell to the Underwriters, and the Underwriters, acting
severally and not jointly, agree to purchase the Notes in the respective
principal amounts set forth on Schedule I hereto from the Company at 97.75%
of their principal amount. One or more certificates in definitive
form for the Notes that the Underwriters have agreed to purchase hereunder, and
in such denomination or denominations and registered in such name or names as
the Underwriters request upon notice to the Company at least 36 hours prior to
the Closing Date, shall be delivered by or on behalf of the Company to the
Underwriters, against payment by or on behalf of the Underwriters of the
purchase price therefor by wire transfer (same day funds), to such account or
accounts as the Company shall specify prior to the Closing Date, or by such
means as the parties hereto shall agree prior to the Closing
Date. Such delivery of and payment for the Notes shall be made at the
offices of Xxxxxx Xxxxxx & Xxxxxxx llp, 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
at 10:00 A.M., New York time, on October15, 2009, or at such other place, time
or date as the Underwriters, on the one hand, and the Company, on the other
hand, may agree upon, such time and date of delivery against payment being
herein referred to as the “Closing
Date.” The Company will make such certificate or certificates
for the Notes available for checking and packaging by the Underwriters at the
offices of Deutsche Bank Securities Inc. in New York, New York, or at such other
place as Deutsche Bank Securities Inc. may designate, at least 24 hours prior to
the Closing Date.
3. Offering by the
Underwriters.
It is
understood that the several Underwriters are to make a public offering of the
Notes as soon as the Representative deems it advisable to do so. The
Notes are to be initially offered to the public at the initial public offering
price set forth in the Prospectus. The Representative may from time
to time thereafter change the public offering price and other selling
terms.
4. Covenants of the
Company.
The
Company covenants and agrees with the several Underwriters that:
(a) The
Company will (A) prepare and timely file with the Commission under Rule 424(b)
(without reliance on Rule 424(b)(8)) under the Act a Prospectus in a form
approved by the Representative containing information previously omitted at the
time of effectiveness of the Registration Statement in reliance on Rules 430A,
430B or 430C under the Act, (B) not file any amendment to the Registration
Statement or distribute an amendment or supplement to the General Disclosure
Package or the Prospectus or document incorporated by ref-
12
erence
therein of which the Representative shall not previously have been advised and
furnished with a copy or to which the Representative shall have reasonably
objected in writing or which is not in compliance with the Rules and Regulations
and (C) file on a timely basis all reports and any definitive proxy or
information statements required to be filed by the Company with the Commission
subsequent to the date of the Prospectus and prior to the termination of the
offering of the Notes by the Underwriters.
(b) The
Company will (i) not make any offer relating to the Notes that would constitute
an Issuer Free Writing Prospectus or that would otherwise constitute a “free
writing prospectus” (as defined in Rule 405 under the Act) required to be filed
by the Company with the Commission under Rule 433 under the Act unless the
Representative approves its use in writing prior to first use (each, a “Permitted Free Writing
Prospectus”); provided that the
prior written consent of the Representative hereto shall be deemed to have been
given in respect of the Issuer Free Writing Prospectus(es) included in
Schedule III hereto, (ii) treat each Permitted Free Writing Prospectus
as an Issuer Free Writing Prospectus, (iii) comply with the requirements of
Rules 163, 164 and 433 under the Act applicable to any Issuer Free Writing
Prospectus, including the requirements relating to timely filing with the
Commission, legending and record keeping and (iv) not take any action that would
result in an Underwriter or the Company being required to file with the
Commission pursuant to Rule 433(d) under the Act a “free writing prospectus” (as
defined in Rule 405 under the Act) prepared by or on behalf of such Underwriter
that such Underwriter otherwise would not have been required to file
thereunder.
(c) The
Company will prepare a final term sheet (the “Final Term Sheet”)
reflecting the final terms of the Notes, in form and substance satisfactory to
the Representative, and shall file such Final Term Sheet as an Issuer Free
Writing Prospectus pursuant to Rule 433 under the Act prior to the close of
business two business days after the date hereof; provided that the Company
shall provide the Representative with copies of any such Final Term Sheet a
reasonable amount of time prior to such proposed filing and will not use or file
any such document to which the Representative or counsel to the Underwriters
shall reasonably object.
(d) The
Company will advise the Representative promptly (A) when any post-effective
amendment to the Registration Statement or new registration statement relating
to the Notes shall have become effective, or any supplement to the Prospectus
shall have been filed, (B) of the receipt of any comments from the Commission,
(C) of any request of the Commission for amendment of the Registration Statement
or the filing of a new registration statement or any amendment or supplement to
the General Disclosure Package or the Prospectus or any document incorporated by
reference therein or otherwise deemed to be a part thereof or for any additional
information, and (D) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or such new
registration statement or any order preventing or suspending the use of any
Preliminary Prospectus, any Issuer Free Writing Prospectus or the Prospectus, or
of the institution of any proceedings for that purpose or pursuant to
Section 8A of the Act. The Company will use its reasonable best
efforts to prevent the issuance of any such order and to obtain as soon as
possible the lifting thereof, if issued.
13
(e) If at any
time when Notes remain unsold by the Underwriters the Company receives from the
Commission a notice pursuant to Rule 401(g)(2) under the Act or otherwise ceases
to be eligible to use the automatic shelf registration statement form, the
Company will (i) promptly notify the Representative, (ii) promptly file a new
registration statement or post-effective amendment on the proper form relating
to the Notes, in a form satisfactory to the Representative, (iii) use its
reasonable best efforts to cause such registration statement or post-effective
amendment to be declared effective as soon as practicable (if such filing is not
otherwise effective immediately pursuant to Rule 462 under the Act), and (iv)
promptly notify the Representative of such effectiveness. The Company
will take all other action necessary or appropriate to permit the public
offering and sale of the Notes to continue as contemplated in the Registration
Statement that was the subject of the notice under Rule 401(g)(2) under the Act
or for which the Company has otherwise become ineligible. References
herein to the Registration Statement relating to the Notes shall include such
new registration statement or post-effective amendment, as the case may
be.
(f) If
immediately prior to the third anniversary (the “Renewal Deadline”) of
the initial effective date of the Registration Statement, any of the Notes
remain unsold by the Underwriters, the Company will, prior to the Renewal
Deadline, file, if it has not already done so and is eligible to do so, a new
automatic shelf registration statement relating to the Notes, in a form
satisfactory to the Representative. If the Company is no longer
eligible to file an automatic shelf registration statement, the Company will,
prior to the Renewal Deadline, if it has not already done so, file a new shelf
registration statement relating to the Notes, in a form satisfactory to the
Representative, and will use its reasonable best efforts to cause such
registration statement to be declared effective within 180 days after the
Renewal Deadline. The Company will take all other action necessary or
appropriate to permit the public offering and sale of the Notes to continue as
contemplated in the expired registration statement. References herein
to the Registration Statement shall include such new automatic shelf
registration statement or such new shelf registration statement, as the case may
be.
(g) The
Company agrees to pay the required filing fees to the Commission relating to the
Notes within the time required by Rule 456(b)(1) under the Act without regard to
the proviso therein and otherwise in accordance with Rules 456(b) and 457(r)
under the Act.
(h) The
Company will cooperate with the Representative in endeavoring to qualify the
Notes for sale under the securities laws of such jurisdictions as the
Representative may reasonably have designated in writing and will make such
applications, file such documents, and furnish such information as may be
reasonably required for that purpose; provided 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 where it is not now so qualified or required to file
such a consent. The Company will, from time to time, prepare and file
such statements, reports, and other documents, as are or may be required to
continue such qualifications in effect for so long a period as the
Representative may reasonably request for distribution of the
Notes.
(i) The
Company will deliver to the Representative as many copies of any Preliminary
Prospectus or any Issuer Free Writing Prospectus as the Representative may
reasonably request. The Company will deliver to the Representative
during the period when deliv-
14
ery of a
Prospectus (or, in lieu thereof, the notice referred to under Rule 173(a) under
the Act) is required under the Act, as many copies of the Prospectus in final
form, or as thereafter amended or supplemented, as the Representative may
reasonably request. The Company will deliver to the Representative at
or before the Closing Date, one signed copy of the Registration Statement and
all amendments thereto including all exhibits filed therewith, and will deliver
to the Representative such number of copies of the Registration Statement
(including such number of copies of the exhibits filed therewith that may
reasonably be requested), including documents incorporated by reference therein,
and of all amendments thereto as the Representative may reasonably
request.
(j) The
Company will comply with the Act, the Rules and Regulations, the Exchange Act
and the Trust Indenture Act, and the rules and regulations of the Commission
thereunder, so as to permit the completion of the distribution of the Notes as
contemplated in this Agreement and the Prospectus. If during the
period in which a prospectus (or, in lieu thereof, the notice referred to under
Rule 173(a) under the Act) is required by law to be delivered by an Underwriter
or dealer, any event shall occur as a result of which, in the judgment of the
Company or in the reasonable opinion of the Underwriters, it becomes necessary
to amend or supplement the Prospectus in order to make the statements therein,
in the light of the circumstances existing at the time the Prospectus is
delivered to a purchaser, not misleading, or, if it is necessary at any time to
amend or supplement the Prospectus to comply with any law, the Company promptly
will either (i) prepare and file with the Commission an appropriate amendment to
the Registration Statement or supplement to the Prospectus or (ii) prepare and
file with the Commission an appropriate filing under the Exchange Act which
shall be incorporated by reference in the Prospectus so that the Prospectus as
so amended or supplemented will not, in the light of the circumstances when it
is so delivered, be misleading, or so that the Prospectus will comply with the
applicable law.
(k) If the
General Disclosure Package is being used to solicit offers to buy the Notes at a
time when the Prospectus is not yet available to prospective purchasers and any
event shall occur as a result of which, in the judgment of the Company or in the
reasonable opinion of the Underwriters, it becomes necessary to amend or
supplement the General Disclosure Package in order to make the statements
therein, in the light of the circumstances, not misleading, or to make the
statements therein not conflict with the information contained in the
Registration Statement then on file, or if it is necessary at any time to amend
or supplement the General Disclosure Package to comply with any law, the Company
promptly will either (i) prepare, file with the Commission (if required) and
furnish to the Underwriters and any dealers an appropriate amendment or
supplement to the General Disclosure Package or (ii) prepare and file with the
Commission an appropriate filing under the Exchange Act which shall be
incorporated by reference in the General Disclosure Package so that the General
Disclosure Package as so amended or supplemented will not, in the light of the
circumstances, be misleading or conflict with the Registration Statement then on
file, or so that the General Disclosure Package will comply with
law.
(l) The
Company will make generally available to its security holders, as soon as it is
practicable to do so, but in any event not later than 15 months after the
effective date of the Registration Statement (as defined in Rule 158(c) under
the Act), an earnings state-
15
ment
(which need not be audited) in reasonable detail, complying with the
requirements of Section 11(a) of the Act and Rule 158 under the Act and
will advise you in writing when such statement has been so made
available.
(m) Prior to
the Closing Date, the Company will furnish to the Underwriters, as soon as they
have been prepared by or are available to the Company, a copy of any unaudited
interim financial statements of the Company for any period subsequent to the
period covered by the most recent financial statements appearing in the
Registration Statement and the Prospectus.
(n) During
the period beginning on the date hereof and continuing to the date that is 30
days after the Closing Date, without the prior written consent of the
Representative, the Company will not offer, sell, contract to sell or otherwise
dispose of, except as provided hereunder, any securities of the Company (or
guaranteed by the Company) that are substantially similar to the
Notes.
(o) The
Company shall apply the net proceeds of its sale of the Notes as set forth in
the Registration Statement, General Disclosure Package and the Prospectus and
shall file such reports with the Commission with respect to the sale of the
Notes and the application of the proceeds therefrom as may be required in
accordance with Rule 463 under the Act.
(p) The
Company shall not invest, or otherwise use, the proceeds received by the Company
from its sale of the Notes in such a manner as would require the Company or any
of the Subsidiaries to register as an investment company under the 0000
Xxx.
(q) The
Company will not take, directly or indirectly, any action designed to cause or
result in, or that has constituted or might reasonably be expected to
constitute, the stabilization or manipulation of the price of any securities of
the Company.
5. Costs and
Expenses.
The
Company will pay all costs, expenses and fees incident to the performance of the
obligations of the Company under this Agreement, including, without limiting the
generality of the foregoing, the following: accounting fees of the
Company and the Guarantors; the fees and disbursements of counsel for the
Company and the Guarantors; one half of the expenses in connection with the
“roadshow” and any other meetings with prospective investors in the Notes; provided, that the
Underwriters shall bear the cost of the chartered plane for the initial flight
from St. Louis to San Francisco and the subsequent flight from San Francisco to
Los Angeles; the cost of printing and delivering to, or as requested by, the
Underwriters copies of the Registration Statement, any Preliminary Prospectus,
the Issuer Free Writing Prospectuses, the Prospectus, this Agreement, the
Indenture and the Underwriters’ Invitation Letter; the filing fees of the
Commission; the filing fees and reasonable expenses (including legal fees and
disbursements) incident to securing any required review by FINRA of the terms of
the sale of the Notes; any fees payable in connection with the rating of the
Notes; the costs and expenses (including without limitation any damages or other
amounts payable in connection with legal or contractual liability) associated
with the reforming of any contracts for sale of the Notes made by the
Underwriters caused by a breach of the representation in Section 1(b); the
expenses, including the fees and disbursements of counsel for the Underwriters,
incurred in connection with the qualification of
16
6. Conditions of Obligations of
the Underwriters.
The
several obligations of the Underwriters to purchase the Notes on the Closing
Date are subject to the accuracy, as of the Applicable Time or the Closing Date,
as the case may be, of the representations and warranties of the Company
contained herein, and to the performance by the Company of its covenants and
obligations hereunder and to the following additional conditions:
(a) The
Registration Statement and all post-effective amendments thereto shall have
become effective and the Prospectus and each Issuer Free Writing Prospectus
required shall have been filed as required by Rules 424(b) (without reliance on
Rule 424(b)(8)), 430A, 430B, 430C or 433 under the Act, as applicable, within
the time period prescribed by, and in compliance with, the Rules and
Regulations, and any request of the Commission for additional information (to be
included in the Registration Statement or otherwise) shall have been disclosed
to the Representative and complied with to its reasonable
satisfaction. No stop order suspending the effectiveness of the
Registration Statement, as amended from time to time, shall have been issued and
no proceedings for that purpose or pursuant to Section 8A under the Act
shall have been taken or, to the knowledge of the Company, shall be contemplated
or threatened by the Commission and no injunction, restraining order or order of
any nature by a Federal or state court of competent jurisdiction shall have been
issued as of the Closing Date which would prevent the issuance of the
Notes.
(b) The
Representative shall have received on the Closing Date the opinion and 10b-5
statement of Xxxxxxxx & Xxxxx LLP, counsel for the Issuers, dated the
Closing Date, addressed to the Underwriters (and stating that it may be relied
upon by counsel to the Underwriters), substantially in the form attached as
Exhibit A hereto.
(c) The
Representative shall have received from Xxxxxx Xxxxxx & Xxxxxxx LLP, counsel for the
Underwriters, an opinion and 10b-5 statement, dated the Closing Date, with
respect to such matters as the Representative may require, and the Issuers shall
have furnished to such counsel such documents as they request for the purpose of
enabling them to pass upon such matters.
17
(d) The
Representative shall have received, on each of the date hereof and the Closing
Date, a letter dated the date hereof and the Closing Date, in form and substance
satisfactory to the Representative and addressed to the Underwriters, of
Deloitte & Touche LLP confirming that they are an independent
registered public accounting firm with respect to the Company and the
Subsidiaries within the meaning of the Act and the applicable Rules and
Regulations and the PCAOB and stating that in their opinion the financial
statements and schedules examined by them and included or incorporated by
reference in the Registration Statement, the General Disclosure Package and the
Prospectus comply in form in all material respects with the applicable
accounting requirements of the Act and the related Rules and Regulations; and
containing such other statements and information as is ordinarily included in
accountants’ “comfort letters” to Underwriters with respect to the financial
statements and certain financial information contained in the Registration
Statement, the General Disclosure Package and the Prospectus.
(e) The
Representative shall have received on the Closing Date a certificate or
certificates of the Chief Executive Officer and the Chief Financial Officer of
the Company to the effect that, as of the Closing Date, each of them severally
represents as follows:
(i) The
Registration Statement has become effective under the Act and no stop order
suspending the effectiveness of the Registration Statement or no order
preventing or suspending the use of any Preliminary Prospectus, any Issuer Free
Writing Prospectus or the Prospectus has been issued, and no proceedings for
such purpose or pursuant to Section 8A of the Act have been taken or are,
to his or her knowledge, contemplated or threatened by the
Commission;
(ii) The
representations and warranties of the Issuers contained in Section 1 hereof
are true and correct in all material respects (except for those representations
and warranties of the Company which are qualified by materiality, in which case
such representations and warranties shall be true and correct in all respects)
as of the Closing Date;
(iii) The
Issuers have satisfied all conditions on their part to be
performed
or satisfied hereunder;
(iv) All
filings required to have been made pursuant to Rules 424(b), 430A, 430B or 430C
under the Act have been made as and when required by such rules;
(v) He or she
has carefully examined the General Disclosure Package and any individual Limited
Use Free Writing Prospectus and, in his or her opinion, as of the Applicable
Time, the statements contained in the General Disclosure Package and any
individual Limited Use Free Writing Prospectus did not contain any untrue
statement of a material fact, and such General Disclosure Package and any
individual Limited Use Free Writing Prospectus, when considered together with
the General Disclosure Package, did not 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;
(vi) He or she
has carefully examined the Registration Statement and, in his or her opinion, as
of the effective date of the Registration Statement, the
Registration
18
Statement
and any amendments thereto did not contain any untrue statement of a material
fact and did not omit to state a material fact necessary in order to make the
statements therein not misleading, and since the effective date of the
Registration Statement, no event has occurred which should have been set forth
in a supplement to or an amendment of the Prospectus which has not been so set
forth in such supplement or amendment;
(vii) He or she
has carefully examined the Prospectus and, in his or her opinion, as of its date
and the Closing Date, the Prospectus and any amendments and supplements thereto
did not contain any untrue statement of a material fact and did not 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
(viii) Since the
respective dates as of which information is given in the Registration Statement,
the General Disclosure Package and Prospectus, there has not been any material
adverse change or any development involving a prospective material adverse
change in or affecting the business, management, properties, assets, rights,
operations, condition (financial or otherwise) or prospects of the Company and
the Subsidiaries taken as a whole, whether or not arising in the ordinary course
of business.
(f) The
Representative shall have been furnished with such further certificates and
documents confirming the representations and warranties, covenants and
conditions contained herein and related matters as the Representative may
reasonably have requested.
(g) Subsequent
to the earlier of (A) the Applicable Time and (B) the execution and delivery of
this Agreement, (i) no downgrading shall have occurred in the rating of the
Notes or any other debt securities or preferred stock of or guaranteed by the
Company or any Subsidiary by any “nationally recognized statistical rating
organization”, as such term is defined by the Commission for purposes of Rule
436(g)(2) under the Act and (ii) no such organization shall have publicly
announced that it has under surveillance or review, or has changed its outlook
with respect to, its rating of the Notes or of any other debt securities or
preferred stock of or guaranteed by the Company or any Subsidiary (other than an
announcement with positive implications of a possible upgrading).
(h) The First
Amendment dated as of October 9, 2009 to that certain Credit Agreement, dated as
of February 28, 2008,
among the Company, the lending institutions party thereto, Citibank,
N.A., as administrative agent for the lenders and the other parties party
thereto as agents shall have been approved by requisite number of lenders
necessary for such approval.
The
opinions and certificates mentioned in this Agreement shall be deemed to be in
compliance with the provisions hereof only if they are in all material respects
satisfactory to the Representative and to Xxxxxx Xxxxxx & Xxxxxxx llp,
counsel for the Underwriters.
If any of
the conditions hereinabove provided for in this Section 6 shall not have
been fulfilled when and as required by this Agreement to be fulfilled, the
obligations of the Underwriters hereunder may be terminated by the
Representative by notifying the Company of such termination in writing or by
telegram at or prior to the Closing Date.
19
In such
event, the Issuers and the Underwriters shall not be under any obligation to
each other (except to the extent provided in Sections 5 and 7
hereof).
7. Indemnification.
(a) The
Issuers, jointly and severally, agree:
(1) to
indemnify and hold harmless each Underwriter, the directors and officers of 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, against any losses, claims, damages or liabilities to which such
Underwriter or any such controlling person may become subject under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) arise out of or are based upon (i) any untrue
statement or alleged untrue statement of any material fact contained in the
Registration Statement, any Preliminary Prospectus, any Issuer Free Writing
Prospectus, the Prospectus or any amendment or supplement thereto, (ii) with
respect to the Registration Statement or any amendment or supplement thereto,
the omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading or
(iii) with respect to any Preliminary Prospectus, any Issuer Free Writing
Prospectus, the Prospectus or any amendment or supplement thereto, the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading in the light
of the circumstances under which they were made; provided, however, that the
Issuers will not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement, or omission or alleged omission made in the
Registration Statement, any Preliminary Prospectus, any Issuer Free Writing
Prospectus, the Prospectus, or such amendment or supplement, in reliance upon
and in conformity with written information furnished to the Company by or
through the Representative specifically for use therein, it being understood and
agreed that the only such information furnished by any Underwriter consists of
the information described as such in Section 12; and
(2) to
reimburse each Underwriter, each Underwriters’ directors and officers, and each
such controlling person upon demand for any legal or other out-of-pocket
expenses reasonably incurred by such Underwriter or such controlling person in
connection with investigating or defending any such loss, claim, damage or
liability, action or proceeding or in responding to a subpoena or governmental
inquiry related to the offering of the Notes, whether or not such Underwriter or
controlling person is a party to any action or proceeding. In the
event that it is finally judicially determined that the Underwriters were not
entitled to receive payments for legal and other expenses pursuant to this
subparagraph, the Underwriters will promptly return all sums that had been
advanced pursuant hereto.
(b) Each
Underwriter severally and not jointly will indemnify and hold harmless the
Issuers, each of their directors, each of their officers who have signed the
Registration Statement and each person, if any, who controls any such Issuer
within the meaning of the Act, against any losses, claims, damages or
liabilities to which such Issuer or any such director,
20
officer
or controlling person may become subject under the Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions or proceedings in
respect thereof) arise out of or are based upon (i) any untrue statement or
alleged untrue statement of any material fact contained in the Registration
Statement, any Preliminary Prospectus, any Issuer Free Writing Prospectus, the
Prospectus or any amendment or supplement thereto, (ii) with respect to the
Registration Statement or any amendment or supplement thereto, the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading or (iii) with respect
to any Preliminary Prospectus, any Issuer Free Writing Prospectus, the
Prospectus or any amendment or supplement thereto, the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading in the light of the
circumstances under which they were made; and will reimburse any legal or other
expenses reasonably incurred by the Company or any such director, officer or
controlling person in connection with investigating or defending any such loss,
claim, damage, liability, action or proceeding; provided, however, that each
Underwriter will be liable in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or alleged
omission has been made in the Registration Statement, any Preliminary
Prospectus, any Issuer Free Writing Prospectus, the Prospectus or such amendment
or supplement, in reliance upon and in conformity with written information
furnished to the Company through the Representative specifically for use
therein, it being understood and agreed that the only such information furnished
by any Underwriter consists of the information described as such in
Section 12. This indemnity agreement will be in addition to any
liability which such Underwriter may otherwise have.
(c) In case
any proceeding (including any governmental investigation) shall be instituted
involving any person in respect of which indemnity may be sought pursuant to
this Section 7, such person (the “indemnified party”)
shall promptly notify the person against whom such indemnity may be sought (the
“indemnifying
party”) in writing. No indemnification provided for in
Section 7(a) or (b) shall be available to any party who shall fail to give
notice as provided in this Section 7(c) if the party to whom notice was not
given was unaware of the proceeding to which such notice would have related and
was materially prejudiced by the failure to give such notice, but the failure to
give such notice shall not relieve the indemnifying party or parties from any
liability which it or they may have to the indemnified party for contribution or
otherwise than on account of the provisions of Section 7(a) or
(b). In case any such proceeding shall be brought against any
indemnified party and it shall notify the indemnifying party of the commencement
thereof, the indemnifying party shall be entitled to participate therein and, to
the extent that it shall wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel satisfactory to
such indemnified party and shall pay as incurred the fees and disbursements of
such counsel related to such proceeding. In any such proceeding, any
indemnified party shall have the right to retain its own counsel at its own
expense. Notwithstanding the foregoing, the indemnifying party shall
pay as incurred (or within 30 days of presentation) the reasonable fees and
expenses of the counsel retained by the indemnified party in the event (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 shall have failed to as-
21
sume the
defense and employ counsel acceptable to the indemnified party within a
reasonable period of time after notice of 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 the reasonable fees and expenses of more than one separate firm
for all such Indemnified Parties. Such firm shall be designated in
writing by you in the case of parties indemnified pursuant to Section 7(a)
and by the Company in the case of parties indemnified pursuant to
Section 7(b). The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent but if settled
with such consent or if there be a final judgment for the plaintiff, the
indemnifying party agrees to indemnify the indemnified party from and against
any loss or liability by reason of such settlement or judgment. In
addition, the indemnifying party will not, without the prior written consent of
the indemnified party, settle or compromise or consent to the entry of any
judgment in any pending or threatened claim, action or proceeding of which
indemnification may be sought hereunder (whether or not any indemnified party is
an actual or potential party to such claim, action or proceeding) unless such
settlement, compromise or consent includes an unconditional release of each
indemnified party from all liability arising out of such claim, action or
proceeding.
(d) To the
extent the indemnification provided for in this Section 7 is unavailable to
or insufficient to hold harmless an indemnified party under Section 7(a) or
(b) above in respect of any losses, claims, damages or liabilities (or actions
or proceedings in respect thereof) referred to therein, then each indemnifying
party shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) in such proportion as is appropriate to reflect
the relative benefits received by the Issuers on the one hand and the
Underwriters on the other from the offering of the Notes. If,
however, the allocation provided by the immediately preceding sentence is not
permitted by applicable law then each indemnifying party shall contribute to
such amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Issuers on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions or proceedings in respect thereof),
as well as any other relevant equitable considerations. The relative
benefits received by the Issuers on the one hand and the Underwriters on the
other shall be deemed to be in the same proportion as the total net proceeds
from the offering (before deducting expenses) received by the Issuers 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 shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Issuers on the one hand or the Underwriters on the
other and the parties’ relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The
Issuers and the Underwriters agree that it would not be just and equitable if
contributions pursuant to this Section 7(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 above in this
Section 7(d). The amount paid or payable by an indemnified party
as a result of the losses, claims,
22
(e) In any
proceeding relating to the Registration Statement, any Preliminary Prospectus,
any Issuer Free Writing Prospectus, the Prospectus or any supplement or
amendment thereto, each party against whom contribution may be sought under this
Section 7 hereby consents to the jurisdiction of any court having
jurisdiction over any other contributing party, agrees that process issuing from
such court may be served upon it by any other contributing party and consents to
the service of such process and agrees that any other contributing party may
join it as an additional defendant in any such proceeding in which such other
contributing party is a party.
(f) Any
losses, claims, damages, liabilities or expenses for which an indemnified party
is entitled to indemnification or contribution under this Section 7 shall
be paid by the indemnifying party to the indemnified party as such losses,
claims, damages, liabilities or expenses are incurred. The indemnity
and contribution agreements contained in this Section 7 and the
representations and warranties of the Issuers set forth in this Agreement shall
remain operative and in full force and effect, regardless of (i) any
investigation made by or on behalf of any Underwriter, its directors or officers
or any person controlling any Underwriter, the Issuers, their directors or
officers or any persons controlling any Issuer, (ii) acceptance of any Notes and
payment therefor hereunder, and (iii) any termination of this
Agreement. A successor to any Underwriter, its directors or officers
or any person controlling any Underwriter, or to any Issuer, its directors or
officers, or any person controlling any such Issuer, shall be entitled to the
benefits of the indemnity, contribution and reimbursement agreements contained
in this Section 7.
8. Default by
Underwriters.
If on the
Closing Date any Underwriter shall fail to purchase and pay for the principal
amount of the Notes which such Underwriter has agreed to purchase and pay for on
such date (otherwise than by reason of any default on the part of the Issuers),
you, as Representative of the Underwriters, shall use your reasonable efforts to
procure within 36 hours thereafter one or more of the other Underwriters, or any
others, to purchase from the Issuers such principal amounts as may be agreed
upon, and upon the terms set forth herein, the Notes which the defaulting
Underwriter or Underwriters failed to purchase. If during such 36
hours you, as such Representative, shall not have procured such other
Underwriters, or any others, to purchase the principal amount of the Notes
agreed to be purchased by the defaulting Underwriter or Underwriters, then (a)
if the aggregate principal amount of Notes with respect to which such default
23
9. Notices.
All
communications hereunder shall be in writing and, except as otherwise provided
herein, will be mailed, delivered, telecopied or telegraphed and confirmed as
follows: if to the Underwriters, to Deutsche Bank Securities Inc., 00
Xxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000;
Attention: Syndicate Manager, with a copy to Deutsche Bank Securities
Inc., 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: General Counsel; if to any Issuer, to Solutia Inc., 000
Xxxxxxxx Xxxxxx Xxxxx, X.X. Xxx 00000, Xx. Xxxxx, Xxxxxxxx 00000,
Attention: General Counsel, with a copy to (which shall not
constitute notice) Xxxxxxxx & Xxxxx LLP, 000 Xxxx 00xx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxxxx X. Xxxxxx,
Esq.
10. Termination.
This
Agreement may be terminated by you by notice to the Company (a) at any time
prior to the Closing Date if any of the following has occurred: (i)
since the date of the most recent financial statements included in the
Registration Statement, the General Disclosure Package and the Prospectus, any
Material Adverse Effect, whether or not arising in the ordinary course of
business, (ii) any outbreak or escalation of hostilities or declaration of war
or national emergency or other national or international calamity or crisis
(including, without limitation, an act of terrorism) or change in economic or
political conditions if the effect of such outbreak, escalation, declaration,
emergency, calamity, crisis or change on the financial markets of the United
States would, in your judgment, make it impracticable or inadvisable to market
the Notes or to enforce contracts for the sale of the Notes, (iii) suspension of
trading in securities generally on the New York Stock Exchange, the American
Stock Exchange or the Nasdaq Global Select Market or limitation on prices (other
than limitations on hours or numbers of days of trading) for securities on any
such trading market, (iv) the declaration of a banking moratorium by United
States or New York State authorities, (v) any downgrading, or placement on any
watch list for possible downgrading, in the rating of any of the Company’s debt
securities by any “nationally
24
11. Successors.
This
Agreement has been and is made solely for the benefit of the Underwriters and
the Issuers and their respective successors, executors, administrators, heirs
and assigns, and the officers, directors and controlling persons referred to
herein, and no other person will have any right or obligation
hereunder. No purchaser of any of the Notes from any Underwriter
shall be deemed a successor or assign merely because of such
purchase.
12. Information Provided by
Underwriters.
The
Issuers and the Underwriters acknowledge and agree that the only information
furnished or to be furnished by any Underwriter to the Company for inclusion in
the Registration Statement, any Preliminary Prospectus, any Issuer Free Writing
Prospectus or the Prospectus consists of the information set forth in the second
sentence of the fifth paragraph, the first sentence of the ninth paragraph, the
tenth paragraph and the eleventh paragraph under the caption “Underwriting” in
the Prospectus.
13. No Advisory or Fiduciary
Responsibility.
The Issuers acknowledge and agree that
(i) the purchase and sale of the Notes pursuant to this Agreement is an
arm’s-length commercial transaction between the Issuers, on the one hand, and
the Underwriters, on the other, (ii) in connection therewith and with the
process leading to such transaction each Underwriter is acting solely as a
principal and not the agent or fiduciary of the Issuers, (iii) no Underwriter
has assumed an advisory or fiduciary responsibility in favor of the Issuers with
respect to the offering contemplated hereby or the process leading thereto
(irrespective of whether such Underwriter has advised or is currently advising
any Issuer on other matters) or any other obligation to any Issuer except the
obligations expressly set forth in this Agreement and (iv) the Issuers have
consulted their own legal and financial advisors to the extent they deemed
appropriate. The Issuers agree that they will not claim that any
Underwriter has rendered advisory services of any nature or respect, or owes a
fiduciary or similar duty to any Issuer, in connection with such transaction or
the process leading thereto.
14. Counterparts.
This
Agreement may be executed in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.
25
15. Survival
Clause.
The
reimbursement, indemnification and contribution agreements contained in this
Agreement and the representations, warranties and covenants in this Agreement
shall remain in full force and effect regardless of (a) any termination of this
Agreement, (b) any investigation made by or on behalf of any Underwriter or
controlling person thereof, or by or on behalf of the Issuers or their directors
or officers and (c) delivery of and payment for the Notes under this
Agreement.
16. Governing Law; Waiver of
Jury Trial.
This
Agreement shall be governed by, and construed in accordance with, the law of the
State of New York, including, without limitation, Section 5-1401 of the New
York General Obligations Law.
The
Underwriters, on the one hand, and the Issuers (on their own behalf and to the
extent permitted by law, on behalf of their stockholders), on the other hand,
waive any right to trial by jury in any action, claim, suit or proceeding with
respect to your engagement as underwriter or your role in connection
herewith.
26
If the
foregoing letter is in accordance with your understanding of our agreement,
please sign and return to us the enclosed duplicates hereof, whereupon it will
become a binding agreement among the Company and the several Underwriters in
accordance with its terms.
| Very truly yours, | |
| SOLUTIA INC. | |
|
|
|
|
|
By: /s/
Xxxx X. Xxxxx III
|
|
Xxxx
X. Xxxxx III
|
|
|
CPFILMS
INC.
|
|
|
FLEXSYS
AMERICA CO.
|
|
|
MONCHEM
INTERNATIONAL, INC.
|
|
|
SOLUTIA
BUSINESS ENTERPRISES INC.
|
|
|
SOLUTIA
INTER-AMERICA, INC.
|
|
|
SOLUTIA
OVERSEAS, INC.
|
|
|
SOLUTIA
SYSTEMS,
INC.
|
|
|
By:
/s/ Xxxxxxx X. Xxxxxxxx
|
|
Xxxxxxx
X. Xxxxxxxx
|
|
|
Authorized
Officer
|
|
FLEXSYS
AMERICA L.P.
|
|
|
By: Flexsys
America Co.,
|
|
|
Its
General Partner
|
|
|
By:
/s/ Xxxxxxx X. Xxxxxxxx
|
|
Xxxxxxx
X. Xxxxxxxx
|
|
SE
INVESTMENT LLC
|
|
|
By: Monchem
International, Inc.,
|
|
|
its
member
|
|
|
By:
/s/ Xxxxxxx X. Xxxxxxxx
|
|
Xxxxxxx
X. Xxxxxxxx
|
The
foregoing Underwriting Agreement
is hereby
confirmed and accepted as of
the date
first above written.
DEUTSCHE
BANK SECURITIES INC.
As
Representative of the several
Underwriters
listed on Schedule I
By: Deutsche
Bank Securities Inc.
| By: | /s/ Xxxxxxx Frauen |
| Authorized Officer | |
| By: | /s/ Xxxxxxxx Xxxxx |
| Authorized Officer |
2
SCHEDULE
I
Underwriters
|
Underwriter
|
Aggregate
Principal
Amount
of Notes
to
be Purchased
|
|
|
Deutsche
Bank Securities Inc.
|
$152,000,000
|
|
|
Xxxxxxxxx &
Company, Inc.
|
$104,000,000
|
|
|
Citigroup
Global Markets Inc.
|
$
60,000,000
|
|
|
X.X.
Xxxxxx Securities Inc.
|
$
40,000,000
|
|
|
HSBC
Securities (USA) Inc.
|
$
20,000,000
|
|
|
Fifth
Third Securities, Inc.
|
$12,000,000
|
|
|
KBC
Financial Products USA Inc.
|
$12,000,000
|
|
|
Total
|
$400,000,000
|
SCHEDULE
II
Guarantors
CPFILMS
INC.
FLEXSYS
AMERICA CO.
FLEXSYS
AMERICA L.P.
MONCHEM
INTERNATIONAL, INC.
SOLUTIA
BUSINESS ENTERPRISES INC.
SOLUTIA
INTER-AMERICA, INC.
SOLUTIA
OVERSEAS, INC.
SOLUTIA
SYSTEMS, INC.
SE
INVESTMENT LLC
