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EXHIBIT 1.1
UNDERWRITING AGREEMENT
SERVICE CORPORATION INTERNATIONAL
Debt Securities
December 8, 1998
To the Underwriter or
Underwriters named in
the within mentioned
Terms Agreement
Ladies and Gentlemen:
Service Corporation International, a Texas corporation (the
"Company"), may issue and sell from time to time its debt securities, consisting
of (i) unsecured senior debt securities (the "Senior Debt Securities"), (ii)
unsecured senior subordinated debt securities (the "Senior Subordinated Debt
Securities") and (iii) subordinated debt securities (the "Subordinated Debt
Securities" and, together with the Senior Debt Securities and the Senior
Subordinated Debt Securities, the "Debt Securities"). The Debt Securities are
registered under the registration statement referred to in Section 4(i) hereof.
The Debt Securities may be issued in one or more series and may have varying
designations, denominations, interest rates and payment dates, maturities,
redemption provisions, conversion provisions, exchange provisions and selling
prices. The Senior Debt Securities will be issued under an indenture (the
"Senior Indenture") to be entered into between the Company and The Bank of New
York, as trustee (the "Senior Trustee"). The Senior Subordinated Debt Securities
will be issued under an indenture (the "Senior Subordinated Indenture") to be
entered into between the Company and Chase Bank of Texas, National Association,
formerly known as Texas Commerce Bank National Association, as trustee (the
"Senior Subordinated Trustee"). The Subordinated Debt Securities will be issued
under an indenture , the "Subordinated Indenture" and, together with the Senior
Indenture and the Senior Subordinated Indenture, the "Indentures") to be entered
into between the Company and Chase Bank of Texas, National Association, formerly
known as Texas Commerce Bank National Association, as trustee (the "Subordinated
Trustee" and, together with the Senior Trustee and the Senior Subordinated
Trustee, the "Trustees"). The Senior Subordinated
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Debt Securities and the Subordinated Debt Securities may be convertible into
shares of common stock, par value $1.00 per share, of the Company (the "Common
Stock"). The basic provisions set forth herein are intended to be incorporated
by reference in a terms agreement of the type referred to below relating to,
among other things, the designation and series of Debt Securities and the
aggregate principal amount of Debt Securities (the "Underwritten Securities") to
be issued and sold by the Company pursuant thereto and to be purchased,
severally, by the underwriter or several underwriters named therein (the
"Underwriters"). The Terms Agreement, which shall be in the form of Exhibit I
hereto (the "Terms Agreement"), relating to the Underwritten Securities and such
additional aggregate principal amount of Debt Securities that the Underwriters
may be granted an option to purchase by the Company to cover over-allotments in
connection with any offering of Underwritten Securities (the "Option Securities"
and together with the Underwritten Securities, the "Offered Securities"),
together with the provisions hereof incorporated therein by reference (which
provisions shall not become effective until so incorporated by reference), is
herein referred to as this "Agreement." The Terms Agreement may reflect that a
portion of the Underwritten Securities are to be sold to the several U.S.
underwriters named therein (the "U.S. Underwriters") in connection with the
offering and sale of a portion of the Underwritten Securities in the United
States and Canada (the "U.S. Underwritten Securities") to United States and
Canadian persons (as defined in the instruments governing the coordination of
the offering by the U.S. Underwriters and the International Managers (as defined
below) named therein) and that the balance of the Underwritten Securities (the
"International Underwritten Securities") are to be sold to the several
international managers named therein (the "International Managers") in
connection with the offering and sale of such International Underwritten
Securities outside the United States and Canada to persons other than United
States and Canadian persons. In such event, as used herein, the term
"Underwriters" refers to the U.S. Underwriters and the International Managers,
and the term "Representatives" refers to the U.S. Representatives named therein
of the U.S. Underwriters and the International Representatives named therein of
the International Managers. If the Underwriters consist only of the firm or
firms referred to in the Terms Agreement as the Representative or
Representatives, then the terms "Underwriters" and "Representatives," as used
herein, shall be deemed to refer to such firm or firms.
The obligations of the Underwriters to purchase, and the
Company to sell, the Offered Securities are evidenced by
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the Terms Agreement delivered at the time the Company determines to sell the
Offered Securities and, without the execution and delivery of the Terms
Agreement, the Company shall not be obligated to sell, and the Underwriters
shall not be obligated to purchase, any Debt Securities pursuant to this
Agreement. The Terms Agreement specifies the firm or firms which will be
Underwriters, the aggregate principal amount of the Offered Securities to be
purchased by each Underwriter, the purchase price to be paid by the Underwriters
for the Offered Securities, the public offering price, if any, of the Offered
Securities and any terms of the Offered Securities not otherwise specified in
the applicable Indenture (including, but not limited to, designations,
denominations, conversion or exchange provisions, covenants, interest rates and
payment dates, maturity, redemption provisions and sinking fund requirements).
The Terms Agreement specifies any details of the terms of the offering that
should be reflected in a post-effective amendment to the applicable Registration
Statement or the Prospectus Supplement (each as hereinafter defined).
The terms which follow, when used in this Agreement, shall
have the meanings indicated. "Registration Statement" shall mean the
registration statement or registration statements relating to the Offered
Securities (and such other securities of the Company as may be included
therein), which shall be the registration statement on Form S-3 filed under the
Securities Act of 1933, as amended (collectively with the rules and regulations
of the Securities and Exchange Commission (the "Commission") thereunder, the
"Securities Act"), referred to in Section 4(i) below, including all documents
incorporated therein by reference and all exhibits thereto, as from time to time
amended or supplemented pursuant to the Securities Act, the Securities Exchange
Act of 1934, as amended (collectively with the rules and regulations of the
Commission thereunder, the "Exchange Act"), or otherwise, including as
supplemented by the Prospectus Supplement, on or prior to the date of execution
and delivery of the Terms Agreement (the "Representation Date") and, in the
event any such amendment or supplement is filed prior to the Closing Date (as
defined in Section 3 hereof), including by the filing of any Prospectus
Supplement or document incorporated by reference, shall also mean such
registration statement as so amended or supplemented. "Prospectus" shall mean
the prospectus (including the related Prospectus Supplement with respect to the
Offered Securities) relating to the Debt Securities (and such other securities
of the Company as may be covered thereby), including all documents incorporated
therein by reference, as from time to time amended or supplemented pursuant to
the Securities Act, the Exchange Act or
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otherwise; provided, however, that a Prospectus Supplement shall be deemed to
have supplemented the Prospectus only with respect to the Offered Securities to
which it relates. Any reference herein to the terms "amend," "amendment" or
"supplement" with respect to the Registration Statement, any preliminary
prospectus or the Prospectus shall be deemed to refer to and include the filing
of any document under the Exchange Act after the effective date of the
Registration Statement, or the issue date of any preliminary prospectus or the
Prospectus, as the case may be, and on or prior to the completion of the
applicable offering (which shall be deemed to be not earlier than such time as
no Underwriter or dealer is required by law to deliver a prospectus in
connection with sales of the Offered Securities) and which is deemed to be
incorporated therein by reference.
1. Agreements to Sell and Purchase. The Company agrees to
issue and sell to each Underwriter as hereinafter provided, and each
Underwriter, upon the basis of the representations and warranties herein
contained, but subject to the conditions hereinafter stated, agrees to purchase
at the purchase price set forth in the Terms Agreement, severally and not
jointly, from the Company the respective aggregate principal amount of
Underwritten Securities set forth opposite the name of such Underwriter on the
annex or annexes to Exhibit I hereto (or such aggregate principal amount of
Underwritten Securities, as the case may be, increased as set forth in Section 9
hereof, subject to such adjustments to eliminate any fractional Offered
Securities as the Representatives in their sole discretion may make).
If, pursuant to the Terms Agreement, the Company shall have
granted the option to the Underwriters to purchase Option Securities, the
Company agrees to sell to the Underwriters designated in the Terms Agreement to
purchase Option Securities (each an "Option Securities Underwriter" and
collectively, the "Option Securities Underwriters") the Option Securities, and
the Option Securities Underwriters shall have a one-time right to purchase,
severally and not jointly, the Option Securities on the terms set forth in the
Terms Agreement. Option Securities may be purchased as provided below solely for
the purpose of covering over-allotments made in connection with the offering of
the Underwritten Securities. If any Option Securities are to be purchased,
subject to the conditions hereinafter stated, each Option Securities Underwriter
agrees, severally and not jointly, to purchase the number of Option Securities
(subject to such adjustments to eliminate any fractional Offered Securities as
the Representatives designated in the Terms Agreement in their sole discretion
may make) that bears
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the same proportion to the total number of Option Securities to be purchased as
the number of Underwritten Securities set forth in the annex or annexes to
Exhibit I hereto opposite the name of such Option Securities Underwriter bears
to the total number of Underwritten Securities to be purchased by all Option
Securities Underwriters.
The Option Securities Underwriters may exercise the option to
purchase the Option Securities at any time on or before the thirtieth day
following the Representation Date, by written notice from the Representatives
designated in the Terms Agreement to the Company. Such notice shall set forth
the aggregate number of Option Securities as to which the option is being
exercised and the date and time when the Option Securities are to be delivered
and paid for, which may be the same date and time as the Closing Date (as
hereinafter defined) but shall not be earlier than the Closing Date nor later
than the tenth full Business Day (as hereinafter defined) after the date of such
notice (unless such time and date are postponed in accordance with the
provisions of Section 9 hereof). Such notice shall be given at least two
Business Days prior to the date and time of delivery specified therein.
2. Terms of Public Offering. The Company understands that the
Underwriters intend (i) to make a public offering of the Offered Securities as
soon after the Prospectus Supplement has been filed and the Terms Agreement has
been executed and delivered as in the judgment of the Representatives is
advisable and (ii) initially to offer the Offered Securities upon the terms set
forth in the Prospectus Supplement and the Underwriters will advise the Company
as to any alteration in the terms of such offering that would require, pursuant
to the Securities Act, any amendment or supplement to the Prospectus Supplement.
3. Delivery of the Offered Securities and Payment Therefor.
Payment for the Offered Securities shall be made to the Company or to the
Company's order by wire transfer of immediately available funds in such location
as the Representatives shall designate in the Terms Agreement at, in the case of
the Underwritten Securities, such time and date as are specified in the Terms
Agreement, or at such other time on the same or such other date, not later than
the fifth Business Day (as hereinafter defined) thereafter, as the
Representatives and the Company may agree upon in writing or, in the case of the
Option Securities, on the date and at the time specified by the Representatives
designated in the Terms Agreement to exercise such option in the written notice
by such Representatives of the election
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to purchase such Option Securities by the Option Securities Underwriters. The
time and date of such payment for the Underwritten Securities are referred to
herein as the "Closing Date" and the time and date for such payment for the
Option Securities, if other than the Closing Date, are herein referred to as the
"Additional Closing Date." As used herein, the term "Business Day" means any day
other than a day on which banks are permitted or required to be closed in New
York City.
Payment for the Offered Securities to be purchased on the
Closing Date or the Additional Closing Date, as the case may be, shall be made
against delivery to the Representatives for the respective accounts of the
several Underwriters of the Offered Securities to be purchased on such date
registered in such names and in such denominations as the Representatives shall
request in writing not later than two full Business Days prior to the Closing
Date or the Additional Closing Date, as the case may be, with any transfer taxes
payable in connection with the transfer to the Underwriters of the Offered
Securities duly paid by the Company. The Company hereby agrees to pay any such
transfer taxes. The certificates for the Offered Securities will be made
available for inspection and packaging by the Representatives not later than
1:00 P.M., New York City time, on the Business Day prior to the Closing Date or
the Additional Closing Date, as the case may be.
4. Representations and Warranties of the Company. The Company
represents and warrants to each Underwriter as of the Representation Date and as
of the Closing Date that:
(i) A registration statement on Form S-3 (Registration No.
333-65711), including a prospectus, with respect to the Debt Securities
(and such other securities of the Company as may be covered thereby),
(i) has been prepared by the Company in conformity with the
requirements of the Securities Act, (ii) has been filed with the
Commission and (iii) has become effective. Such Registration Statement
and the related prospectus may have been amended or supplemented from
time to time prior to the Representation Date; any such amendment to
the applicable Registration Statement was so prepared and filed and any
such amendment has become effective. A prospectus supplement (the
"Prospectus Supplement"), including a prospectus, relating to the
Offered Securities has been prepared. The Prospectus Supplement and, if
not previously filed, such prospectus will be filed pursuant to Rule
424 under the Securities Act. If the offering of the Offered Securities
is to be made by U.S. Underwriters and International Managers, two
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such prospectus supplements, one relating to the Offered Securities to
be sold by the U.S. Underwriters and one relating to the Underwritten
Securities to be sold by the International Managers, and each identical
to the other except for the cover page, have been so prepared and
filed. In such event, the term "Prospectus Supplement" refers to such
international and U.S. prospectus supplements. Copies of such
Registration Statement and the Prospectus relating thereto, any such
amendment or supplement, the Prospectus Supplement and all documents
incorporated by reference therein which were filed with the Commission
on or prior to the Representation Date (including one fully executed
copy of the Registration Statement and of each amendment thereto for
counsel for the Underwriters) have been delivered to each of the
Representatives. The Company has included in the Registration
Statement, as amended at the date the Registration Statement was
declared effective (the "Effective Date"), all information (other than
information relating specifically to the terms of any particular series
of Debt Securities and the offering thereof) required by the Securities
Act to be included in the Prospectus with respect to the Offered
Securities (and the Common Stock, if applicable) and the offering and
sale thereof. Except to the extent that the Underwriters shall agree in
writing to a modification, the Registration Statement and the
Prospectus shall be in all substantive respects in the form furnished
to the Underwriters prior to the Representation Date or, to the extent
not completed at the Representation Date, shall contain only such
specific additional information and other changes as the Company has
advised the Underwriters, a reasonable time prior to the Representation
Date, is to be included or made therein and as to which the
Underwriters have not reasonably objected.
(ii) The Registration Statement, at the time it became
effective, any post-effective amendment thereto, at the time it became
effective, the Registration Statement and the Prospectus, as of the
Representation Date and at the Closing Date, and any amendment or
supplement thereto, conformed or will conform in all material respects
to the requirements of the Securities Act and the Trust Indenture Act
of 1939, as amended, and the Rules and Regulations of the Commission
thereunder (the "Trust Indenture Act"); and no such document included
or will include an untrue statement of a material fact or omitted or
will omit to state a material fact required to be stated therein or
necessary to make the statements therein (in the case of the
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Prospectus, in the light of the circumstances under which they were
made) not misleading; provided, however, that the Company makes no
representation or warranty as to (a) information contained in or
omitted from the Registration Statement or the Prospectus in reliance
upon and in conformity with written information relating to any
Underwriter furnished to the Company by or on behalf of any Underwriter
expressly for use therein and (b) that part of the Registration
Statement that constitutes the Statement of Eligibility on Form T-1 of
any of the Trustees under the Trust Indenture Act filed as an exhibit
to the Registration Statement (the "Form T-1").
(iii) No order preventing or suspending the use of any
preliminary prospectus has been issued by the Commission.
(iv) (A) No stop order suspending the effectiveness of the
Registration Statement is in effect and no proceedings for that purpose
are pending before or threatened by the Commission and (B) each
document, if any, filed or to be filed pursuant to the Exchange Act and
incorporated by reference in the Prospectus complied or will comply
when so filed in all material respects with the Exchange Act and did
not, or will not when so filed, 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.
(v) PricewaterhouseCoopers, who are reporting upon the audited
financial statements and the supporting schedules of the Company
included or incorporated by reference in the Registration Statement and
the Prospectus, are independent public accountants within the meaning
of the Securities Act. The financial statements, and the related notes
thereto, included or incorporated by reference in the Registration
Statement and the Prospectus, present fairly the consolidated financial
position of the Company and its consolidated subsidiaries as of the
dates indicated and the results of their operations and the changes in
their consolidated cash flows for the periods specified; and said
financial statements have been prepared in conformity with United
States generally accepted accounting principles applied on a consistent
basis, except as set forth therein, and the supporting schedules
included or incorporated by reference in the Registration Statement
present fairly the information required to be stated therein. If pro
forma financial information is included in or incorporated by reference
into the Registration
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Statement and the Prospectus, such pro forma financial information
(including, without limitation, the notes thereto) as of the date
presented (A) presented fairly in all material respects the information
shown therein, (B) was prepared in accordance with applicable
requirements of Regulation S-X promulgated under the Exchange Act, (C)
was prepared in accordance with the Commission's rules and guidelines
with respect to pro forma financial statements and (D) was properly
computed on the bases described therein. In the opinion of the Company,
the assumptions used in the preparation of any such pro forma financial
information (including, without limitation, the notes thereto) were
fair and reasonable and the adjustments used therein were appropriate
to give effect to the transactions or circumstances referred to
therein. No pro forma financial statements or other pro forma financial
information is required to be included or incorporated by reference in
the Registration Statement and the Prospectus other than those included
or incorporated by reference therein.
(vi) The Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the State
of Texas, has the corporate power and authority to own its property and
to conduct its business as described in the Registration Statement and
the Prospectus and to enter into this Agreement and the Terms
Agreement, and is duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct of its business or
its ownership or leasing of property requires such qualification,
except to the extent that the failure to be so qualified or be in good
standing could not, singly or in the aggregate, reasonably be expected
to have a material adverse effect on the condition (financial or
otherwise), earnings, business affairs or business prospects of the
Company and its subsidiaries, taken as a whole (each, a "Material
Adverse Effect").
(vii) Each direct and indirect foreign and domestic subsidiary
of the Company listed on Schedule I hereto, which constitute all of the
significant subsidiaries of the Company within the meaning of Rule 1-02
of Regulation S-X under the Exchange Act (each, a "Subsidiary" and
collectively, the "Subsidiaries") has been duly incorporated or
organized, is validly existing as a corporation or entity in good
standing under the laws of the jurisdiction of its incorporation or
organization, has the corporate or other power and authority to own its
property and to
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conduct its business as described in the Registration Statement and the
Prospectus and is duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct of its business or
its ownership or leasing of property requires such qualification,
except to the extent that the failure to be so incorporated, be in
existence, have such power and authority, be so qualified or be in good
standing could not, singly or in the aggregate, reasonably be expected
to have a Material Adverse Effect. All of the outstanding shares of
capital stock of each Subsidiary have been duly authorized and validly
issued, are fully paid and nonassessable, and, except as set forth in
the Registration Statement and the Prospectus, are owned by the
Company, directly or indirectly, free and clear of all liens,
encumbrances, security interests, claims and restrictions on
transferability and voting (other than any restrictions on
transferability as may arise under state and federal securities laws).
Except as set forth in the Registration Statement and the Prospectus,
there are no outstanding (i) securities or obligations convertible into
or exchangeable or exercisable for any shares of capital stock of, or
other interest in, the Company or any Subsidiary, (ii) rights, warrants
or options to acquire or purchase any shares of capital stock of, or
other interest in, the Company or any Subsidiary or any such
convertible, exchangeable or exercisable securities or obligations, or
(iii) obligations or understandings to issue or sell any shares of
capital stock of, or other interest in, the Company or any Subsidiary,
any such convertible, exchangeable or exercisable securities or
obligations, or any such warrants, rights or options, except as have
been disclosed to the Underwriters in writing prior to the date hereof
and except for (A) issuances of shares of Common Stock and options to
acquire Common Stock after the date of the most recent information set
forth in the Registration Statement and the Prospectus pursuant to the
Company's employee benefit plans as in effect on the date hereof and
(B) issuances after the date of the most recent information set forth
in the Registration Statement and the Prospectus of convertible
debentures of the Company and Common Stock pursuant to the Company's
Registration Statement on Form S-4 (Registration No. 333-66957) and the
Company's Registration Statement on Form S-4 (Registration No.
333-01857) (together, the "S-4").
(viii) There are no partnerships in which the Company or any
of the Subsidiaries has any direct or indirect controlling interest
that would constitute a significant
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subsidiary within the meaning of Rule 1-02 of Regulation S-X under the
Exchange Act. Except for the capital stock of the Subsidiaries and
except as set forth in the Registration Statement and the Prospectus,
the Company does not own, directly or indirectly, any shares of stock
or any other equity or long-term debt securities or have any equity
interest in any firm, partnership, joint venture or other entity.
(ix) This Agreement and the Terms Agreement have been duly and
validly authorized, executed and delivered by the Company.
(x) Since the date of the latest consolidated financial
statements of the Company and its subsidiaries included in the
Registration Statement and the Prospectus, except as set forth in or
expressly contemplated by the Registration Statement and the
Prospectus, there has not been (A) any change in the Company's issued
capital stock or options, except (I) pursuant to the exercise of
options or the conversion or exchange of outstanding convertible or
exchangeable securities of the Company or any of its subsidiaries, (II)
issuances of shares of Common Stock and options to acquire Common Stock
issued after the date of such financial statements pursuant to the
Company's employee benefit plans as in effect on the date hereof and
(III) issuances after the date of such financial statements of
convertible debentures of the Company and Common Stock pursuant to the
S-4, or (B) any material adverse change in the management, condition
(financial or otherwise), earnings, business affairs or business
prospects of the Company and its subsidiaries, taken as a whole (each,
a "Material Adverse Change," and any event or state of facts which
could, singly or in the aggregate, reasonably be expected to result in
a Material Adverse Change is herein referred to as a "Prospective
Material Adverse Change"), whether or not arising from transactions or
events occurring in the ordinary course of business.
(xi) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as set
forth therein, (A) there have been no transactions or contracts
(written or oral) entered into or agreed to be entered into by the
Company or any of the Subsidiaries (other than those in the ordinary
course of business) which are material to the Company and its
subsidiaries, taken as a whole and (B) there has been no dividend or
distribution of any kind declared, paid or
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made by the Company on any class of its capital stock, other than
regularly scheduled quarterly dividends in accordance with the past
practice of the Company.
(xii) If the Prospectus contains a section entitled
"Capitalization," as of the date of the Prospectus Supplement, the
Company has the authorized, issued and outstanding capitalization set
forth in the Prospectus under "Capitalization." The authorized capital
stock of the Company (including, without limitation, the Common Stock
issuable upon conversion or exchange of the Offered Securities, if
applicable) conforms as to legal matters to the description thereof
contained in the Registration Statement and the Prospectus, and all of
the outstanding shares of capital stock of the Company have been duly
authorized and validly issued, are fully paid and nonassessable and are
not subject to any preemptive or similar rights. The rights agreement
dated as of May 14, 1998 between the Xxxxxx Trust and Savings Bank (the
"Rights Agreement"), has been duly authorized, executed and delivered
by the Company; the rights (the "Rights") to purchase the Company's
Series D Junior Participating Preferred Stock (the "Series D Preferred
Stock") outstanding thereunder and, if the Offered Securities are
convertible into shares of Common Stock, to be issued upon issuance of
the Common Stock upon conversion of such Offered Securities, have been
duly authorized; the Series D Preferred Stock to be issued upon
exercise of the Rights has been duly authorized; and the description of
the Rights Agreement and the Rights set forth in the Registration
Statement and the Prospectus is accurate in all material respects.
(xiii) All corporate action required to be taken for the
authorization, issuance and sale of the Offered Securities pursuant to
this Agreement and the Terms Agreement has been validly and
sufficiently taken. The Offered Securities, when executed by the
Company and authenticated by the applicable Trustee in accordance with
the terms of the applicable Indenture (assuming the due authorization,
execution and delivery of such Indenture by the Trustee thereunder),
and delivered to and paid for by the Underwriters in accordance with
the terms of this Agreement and the Terms Agreement and the applicable
Indenture (assuming the due authorization, execution and delivery
thereof by the Trustee thereunder), will constitute the valid and
binding obligations of the Company entitled to the benefits of the
applicable Indenture and enforceable against the Company in accordance
with their terms, subject to
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applicable bankruptcy, insolvency, reorganization, moratorium and
similar laws affecting creditors' rights and remedies generally and
subject to general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law). The Company
has all the requisite corporate power and authority to execute and
deliver the applicable Indenture and any supplemental indenture to such
Indenture relating to the Offered Securities (the "Supplemental
Indenture") and to incur and perform its obligations provided for
therein. Each of the Indenture and the Supplemental Indenture relating
to the Offered Securities, when executed by the Company and the Trustee
thereunder (assuming the due authorization, execution and delivery of
such Indenture and Supplemental Indenture by the Trustee thereunder),
will constitute the valid and binding obligations of the Company
enforceable against the Company in accordance with their terms, subject
to applicable bankruptcy, insolvency, reorganization, moratorium and
similar laws affecting creditors' rights and remedies generally and
subject to general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law). If the
Offered Securities are convertible into Common Stock, the Offered
Securities are convertible into Common Stock in accordance with their
terms and the terms of the applicable Supplemental Indenture relating
to the Offered Securities.
(xiv) If the Offered Securities are convertible into Common
Stock, the Common Stock issuable upon conversion of the Offered
Securities pursuant to the terms of the Supplemental Indenture has been
duly authorized and validly reserved for issuance upon such conversion
by all necessary corporate action and such Common Stock, when duly
issued upon such conversion will be validly issued and fully paid and
nonassessable; no holder thereof will be subject to personal liability
solely by reason of being such a holder; and the issuance of such
Common Stock upon such conversion will not be subject to preemptive
rights.
(xv) The Offered Securities and the Indenture and Supplemental
Indenture relating thereto conform in all material respects to the
descriptions thereof in the Prospectus.
(xvi) The execution and delivery by the Company of, and the
full and timely performance by the Company of its obligations under,
this Agreement and the Terms Agreement, the Indenture relating to the
Offered Securities, the
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Supplemental Indenture relating to the Offered Securities and the
Offered Securities, the compliance by the Company with the terms
thereof, and the consummation of each of the transactions contemplated
herein and therein, (A) have been duly authorized by all necessary
corporate action on the part of the Company, (B) do not and will not
result in any violation of the articles of incorporation or by-laws of
the Company and (C) do not and will not conflict with, or result in a
breach or violation of, any of the terms or provisions of, or
constitute a default (or an event which, with notice or lapse of time,
or both, would constitute a default) under, or give rise to any right
to accelerate the maturity or require the prepayment of any
indebtedness under, or result in the creation or imposition of any
lien, charge or encumbrance upon any material property or assets of the
Company or of any Subsidiary under (I) any indenture, mortgage, loan
agreement, note, lease, license, partnership agreement, franchise
agreement or other agreement or instrument to which the Company or any
Subsidiary is a party or by which any of them may be bound or affected
or to which any of their respective properties or assets may be subject
(each, a "Contract" and collectively, the "Contracts"), other than any
such conflict, breach, default, acceleration, prepayment, lien, charge
or encumbrance that, could not individually or in the aggregate,
reasonably be expected to result in any Material Adverse Effect, (II)
any existing applicable law, rule or regulation (other than the
securities or Blue Sky laws of the various states and other
jurisdictions of the United States of America) or (III) any judgment,
order or decree of any government, governmental instrumentality or
court, domestic or foreign, having jurisdiction over the Company or any
Subsidiary or any of their respective properties or assets.
(xvii) No authorization, approval, consent or license of, or
filing with, any government, governmental instrumentality or court,
domestic or foreign (other than as have been made and obtained and are
in full force and effect under the Securities Act and the Trust
Indenture Act or as may be required under the securities or Blue Sky
laws of the various states and other jurisdictions of the United States
of America) is required for the valid authorization, issuance, sale and
delivery of the Offered Securities by the Company, the execution and
delivery by the Company of, or the full and timely performance by the
Company of each of its obligations under, this Agreement, the Terms
Agreement, the Indenture relating to the Offered
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Securities, the Supplemental Indenture relating to the Offered
Securities, and the compliance by the Company with its obligations
thereunder.
(xviii) There are no contracts or other documents that are
required to be described in the Registration Statement or the
Prospectus or to be filed or incorporated by reference as exhibits to
the Registration Statement that are not described, filed or
incorporated as required.
(xix) No holder of any securities of the Company has any
rights, not effectively satisfied or waived, to require the Company to
register the sale of any securities under the Securities Act in
connection with the filing of the Registration Statement or the
consummation of the transactions contemplated therein or pursuant to
this Agreement or the Terms Agreement.
(xx) The Company and its subsidiaries are in compliance with
any and all applicable foreign, federal, state and local laws and
regulations relating to the protection of human health, or the
environment or imposing liability or standards of conduct concerning
Hazardous Material (collectively, "Environmental Laws"), except where
such noncompliance with Environmental Laws could not, singly or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
The term "Hazardous Material" means (i) any "hazardous substance" as
defined by the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, (ii) any "hazardous waste" as
defined by the Resource Conservation and Recovery Act, as amended,
(iii) any petroleum or petroleum product, (iv) any polychlorinated
biphenyl, (v) any pollutant or contaminant or hazardous, dangerous, or
toxic chemical, material, waste or substance regulated under or within
the meaning of any other Environmental Law.
(xxi) Each of the Company and each of its subsidiaries owns,
possesses or has obtained all licenses, permits, certificates,
consents, orders, approvals and other authorizations from, and has made
all declarations and filings with, all federal, state, local and other
governmental authorities (including foreign regulatory agencies), all
self-regulatory organizations and all courts and other tribunals,
domestic or foreign, necessary to own or lease, as the case may be, and
to operate its properties and to carry on its business as conducted as
of the date hereof, except in each case where the failure to obtain
16
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licenses, permits, certificates, consents, orders, approvals and other
authorizations, or to make all declarations and filings, could not,
singly or in the aggregate, reasonably be expected to have a Material
Adverse Effect, and neither the Company nor any such subsidiary has
received any notice of any proceeding relating to revocation or
modification of any such license, permit, certificate, consent, order,
approval or other authorization, except as described in the
Registration Statement and the Prospectus and except, in each case,
where such revocation or modification could not, reasonably be expected
to singly or in the aggregate, have a Material Adverse Effect; and the
Company and each of its subsidiaries are in compliance with all laws
and regulations relating to the conduct of their respective businesses
as conducted as set forth in the Registration Statement and the
Prospectus, except where noncompliance with such laws or regulations
could not, singly or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
(xxii) To the best knowledge of the Company, each of the
Company and each of its subsidiaries owns or possesses the patents,
patent licenses, trademarks, service marks, trade names, copyrights and
know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures) (collectively, the "Intellectual Property") reasonably
necessary to carry on the business conducted by each as conducted on
the date hereof, except to the extent that the failure to own or
possess such Intellectual Property could not, singly or in the
aggregate, reasonably be expected to have a Material Adverse Effect,
and, except as set forth in the Registration Statement and the
Prospectus, neither the Company nor any Subsidiary has received any
notice of infringement of or conflict with asserted rights of others
with respect to any Intellectual Property, except for notices the
content of which if accurate could not, singly or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
(xxiii) Except as set forth in the Registration Statement and
the Prospectus, no authorization, approval or consent of any
governmental authority or agency is required (other than those which
have already been obtained) under the laws of any jurisdiction in which
the Company or any of the Subsidiaries conduct their respective
businesses in connection with the ownership by the Company of capital
stock of any Subsidiary, any foreign exchange controls or the
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repatriation of any amount from or to the Company and the Subsidiaries,
except to the extent such authorizations, approvals or consents have
been obtained and are in full force and effect and except to the extent
that the failure to obtain such authorization, approval or consent
could not, singly or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
(xxiv) The Company has not taken and will not take, directly
or indirectly, any action designed to, or that might be reasonably
expected to, cause or result in stabilization or manipulation of the
price of the Offered Securities (or the Common Stock, if applicable),
and the Company has not distributed and will not distribute any
prospectus or other offering material in connection with the offering
and sale of the Offered Securities other than any preliminary
prospectus filed with the Commission or the Prospectus or other
materials permitted under the Securities Act.
(xxv) Except as set forth in the Registration Statement and
the Prospectus, there is no action, suit or proceeding before or by any
government, governmental or regulatory instrumentality, agency or body
or court, domestic or foreign, or any arbitrator, now pending or, to
the best knowledge of the Company, threatened, against or affecting the
Company or any subsidiary of the Company or any affiliate of the
Company that, singly or in the aggregate with all such actions, suits
and proceedings (i) could reasonably be expected to have a Material
Adverse Effect or could reasonably be expected to have a material
adverse effect on the consummation of the transactions contemplated by
this Agreement and the Terms Agreement or (ii) is required to be
described in the Registration Statement or the Prospectus that is not
so described.
(xxvi) Neither the Company nor any subsidiary of the Company
(i) is in violation of its articles of incorporation, by-laws or other
organizational documents or (ii) is or with the giving of notice or
lapse of time or both would be in violation of, or in breach of or in
default under or in the performance or observance of, any obligation,
agreement, covenant or condition contained in this Agreement, the Terms
Agreement or any Contract or of any permit, order, decree, judgment,
statute, rule or regulation, foreign or domestic, applicable to the
Company or any Subsidiary, except for such violations, breaches or
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defaults that, could not singly or in the aggregate, reasonably be
expected to have a Material Adverse Effect.
(xxvii) The Company is not an "investment company" or an
entity "controlled" by an "investment company" as such terms are
defined in the Investment Company Act of 1940, as amended or a holding
company or a subsidiary of a holding company under the Public Utility
Holding Company Act of 1935.
(xxviii) The Company has complied with all provisions of
Section 517.075, Florida Statutes (Chapter 92-1933 8, Laws of Florida).
(xxix) The statistical and market-related data included or
incorporated by reference in the Registration Statement and the
Prospectus are based on or derived from sources which the Company
believes to be reliable and accurate or represent the Company's good
faith estimates that are made on the basis of data derived from such
sources.
(xxx) The Company knows of no outstanding claims for services,
in the nature of a finder's fee or origination fee or other similar
claim, with respect to the transactions contemplated hereby and by the
Terms Agreement, other than the underwriting fees and compensation to
be paid to the Underwriters in accordance with this Agreement.
(xxxi) No labor disputes exist with employees of the Company
or of the Subsidiaries that could, singly or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
Any certificate signed by any officer of the Company and
delivered to the Underwriters or to counsel for the Underwriters shall be deemed
a representation and warranty by the Company to each Underwriter as to the
matters covered thereby.
5. Agreements of the Company. The Company covenants and agrees
with each Underwriter as follows:
(a) To use its reasonable best efforts to cause any legally
necessary amendment to the Registration Statement to become effective
at the earliest possible time.
(b) To furnish to each of the Representatives, without charge,
as many signed copies of the Registration
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Statement (as originally filed) and each amendment thereto and each
document incorporated or deemed incorporated therein, in each case
including exhibits filed therewith or incorporated therein, as the
Representatives may reasonably request, and to each other Underwriter a
conformed copy of the Registration Statement (as originally filed) and
each amendment thereto, in each case without exhibits and, during the
period mentioned in paragraph (e) below, to each of the Underwriters as
many copies of the Prospectus (including all amendments and supplements
thereto and documents incorporated by reference therein) as the
Representatives may reasonably request.
(c) To give the Underwriters prompt notice of the Company's
intention to file or prepare any amendment to the Registration
Statement or any amendment or supplement to the Prospectus, whether
pursuant to the Securities Act, the Exchange Act or otherwise, to
furnish the Underwriters and their counsel with copies of any such
amendment or supplement a reasonable amount of time prior to such
proposed filing or use, as the case may be, and not to file any such
amendment or supplement or use any such prospectus to which the
Underwriters or counsel for the Underwriters shall object. Subject to
the foregoing sentence, the Company will cause each Prospectus
Supplement relating to the Offered Securities to be filed with the
Commission pursuant to the applicable paragraph of Rule 424 under the
Securities Act within the time period prescribed and will provide
evidence satisfactory to the Underwriters of such timely filing.
(d) To advise the Representatives and their counsel promptly,
and to confirm such advice in writing, (i) when any Prospectus
Supplement relating to the Offered Securities shall have been filed
with the Commission pursuant to Rule 424 under the Securities Act, (ii)
when, prior to the termination of the offering of the Offered
Securities, any amendment to the Registration Statement shall have been
filed with the Commission or become effective, (iii) of the receipt of
any comments from the Commission or of any request by the Commission
for any amendment to the Registration Statement or any amendment or
supplement to the Prospectus or for any additional information, (iv) of
the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order preventing
or suspending the use of any Prospectus or Prospectus Supplement or the
initiation or threatening of any proceeding for that purpose and (v) of
the receipt
20
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by the Company of any notification with respect to any suspension of
the qualification of the Offered Securities for offer and sale in any
jurisdiction or the initiation of any proceeding for such purpose; and
to use its reasonable best efforts to prevent the issuance of any such
stop order or notification and, if issued, to obtain as soon as
possible the withdrawal thereof.
(e) If, during such period after the first date of the public
offering of the Offered Securities as in the opinion of the
Underwriters' counsel a prospectus relating to the Offered Securities
is required by law to be delivered in connection with sales by an
Underwriter or dealer, any event shall occur, information shall become
known or condition exist as a result of which it is necessary or
advisable to amend or supplement the Prospectus in order to make the
statements therein, in the light of the circumstances when the
Prospectus is delivered to a purchaser, not misleading, or if it is
necessary or advisable to amend or supplement the Prospectus to comply
with law, forthwith, at the sole expense of the Company, to prepare,
and, subject to Section 5(c) above, file with the Commission and
furnish, without charge, to the Underwriters and to the dealers (whose
names and addresses the Representatives will furnish to the Company) to
which Offered Securities may have been sold by the Representatives on
behalf of the Underwriters and to any other dealers, upon request, such
amendments or supplements to the Prospectus as may be necessary so that
the statements in the Prospectus as so amended or supplemented will
not, in the light of the circumstances when the Prospectus is delivered
to a purchaser, be misleading or so that the Prospectus will comply
with law.
(f) To endeavor to qualify the Offered Securities (and, if
applicable, the Common Stock) for offer and sale under the securities
or Blue Sky laws of such jurisdictions as the Representatives shall
request and to continue such qualification in effect so long as
required for distribution of the Offered Securities and to pay all fees
and expenses (including fees and disbursements of counsel to the
Underwriters) incurred in connection with such qualification; provided,
however, that the Company shall not be required to file a general
consent to service of process in any jurisdiction or subject itself to
general taxation in any jurisdiction.
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(g) To make generally available to its security holders and to
the Representatives as soon as practicable, but not later than 15
months after the date of each Terms Agreement, an earnings statement,
covering a period of at least 12 months beginning 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, which will satisfy the provisions of Rule 158 under
the Securities Act and Section 11(a) of the Securities Act.
(h) For a period of 90 days after the Representation Date,
without the prior written consent of the Representative designated in
the Terms Agreement, not to, and not cause or permit any subsidiary of
the Company to, directly or indirectly, effect any offer, sale or other
disposition of, or registration of, any Debt Securities or any other
long term debt, notes or debentures of or guaranteed by the Company or
any of its subsidiaries or any securities convertible into or
exchangeable or exercisable for Debt Securities or any such long-term
debt, notes or debentures, other than the Offered Securities to be sold
pursuant to the Terms Agreement and other than pursuant to such other
exceptions, if any, as are agreed to by the Representatives and set
forth in the Terms Agreement. If the Offered Securities are convertible
into Common Stock, during a period of 90 days from the Representation
Date, the Company will not, without the prior written consent of the
Representative designated in the Terms Agreement, directly or
indirectly, effect any offer, sale or other disposition of, or
registration of, shares of Common Stock or any right to purchase or
other security convertible into or exchangeable or exercisable for or
any securities of the Company substantially similar to any such shares,
other than (A) the Offered Securities to be sold pursuant to the Terms
Agreement, (B) shares of Common Stock issued upon conversion, exercise
or exchange of convertible, exchangeable or exercisable securities of
the Company or of any subsidiary of the Company outstanding on the
Representation Date and (C) shares of Common Stock and options
thereunder issued pursuant to employee benefit plans of the Company in
place on the Representation Date as in effect on the Representation
Date, and other than pursuant to such other exceptions, if any, as are
agreed to by the Representatives and set forth in the Terms Agreement.
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(i) Whether or not the transactions contemplated hereby or by
the Terms Agreement are consummated or this Agreement is terminated or
shall not become effective, to pay all costs and expenses incident or
relating to the performance of the Company's obligations hereunder,
including, without limiting the generality of the foregoing, all costs
and expenses (i) incurred in connection with the preparation, issuance,
execution and delivery of the Offered Securities (including, if
applicable, the Common Stock issuable upon conversion thereof), (ii)
incurred in connection with the preparation, printing and filing under
the Securities Act and the Exchange Act of the Registration Statement,
the Prospectus, any preliminary prospectus and each Prospectus
Supplement (including in each case all exhibits, amendments and
supplements thereto and all documents incorporated therein by
reference), (iii) incurred in connection with the registration or
qualification of the Offered Securities (including, if applicable, the
Common Stock issuable upon conversion or exchange thereof) under the
laws of such jurisdictions as the Representatives may request
(including filing fees and the fees of counsel for the Underwriters and
their disbursements), (iv) relating to any filing with the National
Association of Securities Dealers, Inc. (the "NASD") in connection with
the offering of the Offered Securities, (v) incurred in connection with
the engagement of any qualified independent underwriter as may be
required by NASD rules and regulations, (vi) incurred in connection
with the rating of the Offered Securities, (vii) incurred in connection
with advertising relating to the Offered Securities approved by the
Company (which approval shall not be unreasonably withheld or delayed),
(viii) relating to the fees and expenses of the applicable Trustee,
including the fees and expenses of counsel to the applicable Trustee,
and of the transfer agent and registrar for the Common Stock if the
Offered Securities are convertible into the Common Stock and (ix)
relating to or in connection with the printing (including word
processing and duplication costs) and delivery of this Agreement, the
Terms Agreement, the Indenture relating to the Offered Securities, any
Supplemental Indenture relating thereto, the agreement among
underwriters, each other document or instrument relating to the
underwriting arrangements and the coordination of the offering of the
Offered Securities by the U.S. Underwriters and the International
Managers, if applicable, any
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dealer agreements, the Preliminary and Supplemental Blue Sky Memoranda
and the furnishing to the Underwriters and dealers of copies of the
Registration Statement, the Prospectus and each Prospectus Supplement,
including mailing and shipping, as herein provided.
(j) To furnish to the Representatives for a period of five
years after the Representation Date copies of all reports or other
communications (financial or other) furnished to holders of the
Company's capital stock, and copies of any reports and financial
statements furnished to or filed with the Commission.
(k) To use the net proceeds of the offering of the Offered
Securities as set forth in the Prospectus Supplement under the caption
"Use of Proceeds."
(l) During the period when the Prospectus is required to be
delivered under the Securities Act or the Exchange Act in connection
with sales (including resales) of the Offered Securities, to file all
documents required to be filed with the Commission pursuant to Section
13, 14 or 15 of the Exchange Act within the time period required by the
Exchange Act and the Exchange Act Regulations.
(m) If the Offered Securities are convertible into Common
Stock, the Company will use its best efforts to effect the listing of
the shares of Common Stock issuable upon conversion of the Offered
Securities on the New York Stock Exchange on the Representation Date.
(n) To reserve and keep available at all times, free of
preemptive rights, sufficient shares of Common Stock to satisfy any
obligations to issue shares of Common Stock upon conversion of all of
the Offered Securities that are convertible into the Common Stock.
(o) To deliver copies of the Prospectus to such place or
places as shall be designated by the Representatives not later than
1:00 p.m., New York City time, on the day after the date of the Terms
Agreement.
6. Conditions of Underwriters' Obligations. The several
obligations of the Underwriters hereunder to purchase the Underwritten
Securities are subject to the following conditions:
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(a) If any amendment to the Registration Statement filed prior
to the Closing Date has not been declared effective as of the
Representation Date, such amendment shall have become effective not
later than 5:30 P.M., New York City time, on the Representation Date;
and at the Closing Date no stop order suspending the effectiveness of
the Registration Statement shall have been issued under the Securities
Act or proceedings therefor initiated or threatened by the Commission.
The price of the Offered Securities and any price-related information
previously omitted from the effective Registration Statement and the
Prospectus Supplement shall have been transmitted to the Commission for
filing pursuant to Rule 424 under the Securities Act within the
prescribed time period and prior to the Closing Date the Company shall
have provided to the Representatives evidence satisfactory to the
Representatives of such timely filing.
(b) The representations and warranties of the Company
contained herein and in the Terms Agreement shall be true and correct
on and as of the Closing Date as if made on and as of the Closing Date
and the Company shall have complied with all agreements and satisfied
all conditions on its part to be performed or satisfied hereunder at or
prior to the Closing Date.
(c) Subsequent to the Representation Date and prior to payment
for the Underwritten Securities on the Closing Date, there shall not
have occurred or become known any Material Adverse Change or any
development involving a Prospective Material Adverse Change other than
as set forth in the Registration Statement and the Prospectus, the
effect of which in the judgment of the Representatives makes it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Underwritten Securities on the terms and in the manner
contemplated in the Registration Statement and the Prospectus. As used
in this Section 6(c), "Prospectus" shall mean the Prospectus first used
to confirm sales of the Offered Securities exclusive of any amendment
or supplement thereto thereafter.
(d) The Representatives shall have received on and as of the
Closing Date a certificate of the Company signed by the Chief Executive
Officer, the Chief Operating Officer or the Chief Financial Officer or
Treasurer of the Company to the effect set forth in subsections (a) and
(b) of this Section 6 and to the further effect that since the most
recent date as of which information is given in the
25
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Prospectus to the Closing Date there shall not have occurred any
Material Adverse Change, or any development involving a Prospective
Material Adverse Change. As used in this Section 6(d), "Prospectus"
shall mean the Prospectus first used to confirm sales of the Offered
Securities exclusive of any amendment or supplement thereto thereafter.
(e) The Representatives shall have received on the Closing
Date a signed opinion of Liddell, Sapp, Zivley, Hill & XxXxxx, L.L.P
("LSZHL"), special counsel for the Company, addressed to the
Underwriters and dated the Closing Date and satisfactory to counsel for
the Underwriters, to the effect that:
(i) The Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of
the jurisdiction of its incorporation and has the corporate
power and authority to own its property and to conduct its
business as described in the Prospectus.
(ii) Each of this Agreement and the Terms Agreement has
been duly authorized, executed and delivered by the Company.
(iii) The Company has the requisite corporate power and
authority to execute, deliver and perform its obligations
under the Indenture relating to the Offered Securities, and
such Indenture has been duly authorized, executed and
delivered by the Company and has been duly qualified under the
Trust Indenture Act and (assuming the due authorization,
execution and delivery by the Trustee thereunder) constitutes
a valid and legally binding instrument of the Company,
enforceable against the Company in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization,
moratorium and similar laws affecting creditors' rights and
remedies generally and subject to the effect of general
principles of equity (regardless of whether enforcement is
sought in a proceeding in equity or at law) and the discretion
of the court before which any proceeding therefor may be
brought.
(iv) The Company has the requisite corporate power and
authority to issue and deliver the Offered Securities, and the
Offered Securities have been duly authorized by the Company
for issuance. The Offered
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Securities, when executed by the Company and authenticated by
the Trustee in accordance with the Indenture relating to the
Offered Securities (assuming the due authorization, execution
and delivery of the Indenture by the Trustee thereunder) and
delivered to and paid for by the Underwriters in accordance
with the terms of this Agreement and the Terms 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, subject to applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or transfer
and similar laws affecting creditors' rights and remedies
generally and subject, as to enforceability, to general
principles of equity (regardless of whether enforcement is
sought in a proceeding in equity or at law) and the discretion
of the court before which any proceeding therefor may be
brought.
(v) The Company has the requisite corporate power and
authority to execute, deliver and perform its obligations
under the Supplemental Indenture (if applicable) relating to
the Offered Securities, and the Supplemental Indenture (if
applicable) has been duly authorized, executed and delivered
by the Company and (assuming the due authorization, execution
and delivery by the Trustee under the Indenture relating to
the Offered Securities) constitutes a valid and legally
binding instrument of the Company, enforceable against the
Company in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance or transfer and similar laws affecting creditors'
rights and remedies generally and subject, as to
enforceability, to general principles of equity (regardless of
whether enforcement is sought in a proceeding in equity or at
law) and the discretion of the court before which any
proceeding therefor may be brought.
(vi) The statements set forth or incorporated by
reference in the Registration Statement and the Prospectus
insofar as such statements purport to summarize certain
provisions of the Offered Securities (and the Common Stock, if
applicable), the Indenture and the Supplemental Indenture
provide a fair summary of such provisions.
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(vii) If the Prospectus contains a section entitled"
Certain United States Federal Income Tax Considerations," the
statements contained in such section, insofar as they
constitute summaries of legal matters, are fair and accurate
in all material respects.
(viii) If the Prospectus contains a section entitled
"Capitalization," the number of authorized shares of capital
stock of the Company is as set forth in the Prospectus under
"Capitalization". The authorized capital stock of the Company
conforms as to legal matters in all material respects to the
description thereof contained in the Prospectus.
(ix) If the Offered Securities are convertible into
Common Stock, upon issuance and delivery of the Offered
Securities, the Offered Securities shall be convertible at the
option of the holder thereof into Common Stock in accordance
with the terms of the Offered Securities and the Supplemental
Indenture (if applicable) relating thereto; the Common Stock
issuable upon conversion of the Offered Securities have been
duly authorized and validly reserved for issuance upon such
conversion by all necessary corporate action, and such Common
Stock, when issued upon such conversion, will be validly
issued, fully paid and nonassessable; no holder of the Common
Stock will be subject to personal liability solely by reason
of being such a holder; and the issuance of such shares upon
such conversion will not be subject to preemptive rights
arising by operation of law or under the charter or by-laws of
the Company.
(x) At the time the Registration Statement and each
amendment thereto became effective and at the Representation
Date, the Registration Statement and the Prospectus (other
than the Form T-1 and the financial statements and schedules
and other financial and statistical data included or
incorporated by reference therein, as to which such counsel
need express no opinion) appear on their face to be
appropriately responsive to the applicable requirements of the
Securities Act. The applicable Indenture, as amended by the
Supplemental Indenture, complies with the requirements of the
Trust Indenture Act.
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(xi) Such counsel does not know of any legal or
governmental actions, suits or proceedings, pending or
threatened, required to be disclosed in the Registration
Statement which are not disclosed therein as required
(provided that for such purpose such counsel need not regard
any action, suit or proceeding to be "threatened" unless the
potential litigant has manifested to the management of the
Company or to such counsel a present intention to initiate
such suit or proceeding).
(xii) Based upon such counsel's review of applicable
law, no authorization, approval, consent or order of any court
or governmental or regulatory authority, body or agency or
third party is required in connection with (A) the offering,
issuance or sale of the Offered Securities or, if applicable,
the valid authorization, issuance and delivery of the Common
Stock issuable upon conversion of the Offered Securities, or
(B) the execution, delivery or full and timely performance of
this Agreement, the Terms Agreement, the Indenture, the
Supplemental Indenture (if applicable) or the Offered
Securities by the Company, except such as may be required
under the Securities Act, the Trust Indenture Act or state
securities laws.
(xiii) To the best of such counsel's knowledge and
information, after due inquiry, the execution, delivery and
the full and timely performance of this Agreement, the Terms
Agreement, the Indenture and the Supplemental Indenture (if
applicable) and the Offered Securities and the consummation of
the transactions contemplated herein (including the issuance,
sale and delivery of the Offered Securities and, if
applicable, the issuance of the Common Stock upon conversion
of the Offered Securities), will not constitute a breach of,
or default under (including, without limitation, any event
which with notice or lapse of time, or both, would constitute
a breach of or a default under), or result in the creation or
imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any of the Subsidiaries
pursuant to, any contract identified on a schedule to such
opinion (the scope of which list of contracts being reasonably
acceptable to the Representatives), nor will such action
result in any violation of the provisions of the charter or
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by-laws of the Company, or any applicable law, rule,
regulation or administrative, regulatory or court judgment,
order or decree, except for any breach, default, lien, charge
or encumbrance under any such contract as could not, singly or
in the aggregate, reasonably be expected to have a Material
Adverse Effect.
(xiv) Each document filed pursuant to the Exchange Act
(other than the financial statements, schedules and other
financial and statistical data included therein, as to which
such counsel need express no opinion) and incorporated or
deemed to be incorporated by reference in the Prospectus
appears on its face to be appropriately responsive to the
applicable requirements of the Exchange Act.
(xv) The Company is not an investment company under the
Investment Company Act of 1940, nor a holding company or a
subsidiary of a holding company under the Public Utility
Holding Company Act of 1935.
Such counsel shall also state that they have been advised by
the Commission that the Indenture has been qualified under the Trust
Indenture Act and that the Registration Statement became effective
under the Securities Act; that any required filings of the Prospectus
pursuant to Rule 424(b) have been made in the manner and within the
time period required by Rule 424(b); and that, based solely on
conversations with the Commission, no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted, are pending or, to
such counsel's knowledge, are contemplated under the Securities Act.
In addition, such counsel shall also include a statement to
the effect that nothing has come to the attention of such counsel which
leads such counsel to believe that (1) the Registration Statement
(other than the financial statements and schedules and other financial
and statistical data included or incorporated by reference therein, as
to which such counsel need not make any statement or express any
opinion), when it became effective and at the Representation Date
contained and, as of the date such opinion is delivered, contains any
untrue statement of a material fact or omitted or omits to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading and (2) the Prospectus (other than
the financial statements and schedules and other financial and
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statistical data included or incorporated by reference therein, as to
which such counsel need not make any statement or express any opinion)
as of its date or at the Representation Date contained and, as of the
date such opinion is delivered, contains any untrue statement of a
material fact or omitted or omits to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
Such counsel in rendering such opinion may rely as to certain
matters of fact on certificates of officers of the Company and of
public officials; provided, however, that (a) such counsel shall state
that such counsel, the Underwriters and counsel for the Underwriters
are justified in relying upon such certificates and (b) such
certificates shall have been delivered to the Representatives prior to
the Closing Date. In rendering such opinion, such counsel may rely as
to matters involving the application of laws of any jurisdiction other
than the State of Texas or the United States or the General Corporation
Law of the State of Delaware, to the extent they deem proper and
specified in such opinion, upon the opinion of other counsel who are
reasonably satisfactory to counsel for the Underwriters; provided,
however, that LSZHL shall state that LSZHL, the Underwriters and
counsel for the Underwriters are justified in relying upon such
opinion. In addition, such counsel may assume for purposes of such
opinion that the laws of the State of New York are identical to the
laws of the State of Texas.
(f) The Representatives shall have received on the Closing
Date a signed opinion of Xxxxx X. Shelger, General Counsel of the
Company, addressed to the Underwriters and dated the Closing Date and
satisfactory to counsel for the Underwriters, to the effect that:
(i) The Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of
the jurisdiction of its incorporation, has the corporate power
and authority to own its property and to conduct its business
as described in the Prospectus and to the best of such
counsel's knowledge and information, after due inquiry, is
duly qualified to transact business and is in good standing in
each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification,
except to the extent that
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the failure to be so qualified or be in good standing could
not, singly or in the aggregate, reasonably be expected to
have a Material Adverse Effect.
(ii) Each Subsidiary has been duly incorporated, is
validly existing as a corporation in good standing under the
laws of the jurisdiction of its incorporation, has the
corporate power and authority to own its property and to
conduct its business as described in the Prospectus and is
duly qualified to transact business and is in good standing in
each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification,
except to the extent that the failure to be so qualified or be
in good standing could not, singly or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
(iii) Each of this Agreement and the Terms Agreement has
been duly authorized, executed and delivered by the Company.
(iv) The Company has the requisite corporate power and
authority to execute, deliver and perform its obligations
under the Indenture relating to the Offered Securities, and
such Indenture has been duly authorized, executed and
delivered by the Company and has been duly qualified under the
Trust Indenture Act and (assuming the due authorization,
execution and delivery by the Trustee thereunder) constitutes
a valid and legally binding instrument of the Company,
enforceable against the Company in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization,
moratorium and similar laws affecting creditors' rights and
remedies generally and subject to the effect of general
principles of equity (regardless of whether enforcement is
sought in a proceeding in equity or at law) and the discretion
of the court before which any proceeding therefor may be
brought.
(v) The Company has the requisite corporate power and
authority to issue and deliver the Offered Securities, and the
Offered Securities have been duly authorized by the Company
for issuance. The Offered Securities, when executed by the
Company and authenticated by the Trustee in accordance with
the Indenture relating to the Offered Securities (assuming the
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due authorization, execution and delivery of the Indenture by
the Trustee thereunder) and delivered to and paid for by the
Underwriters in accordance with the terms of this Agreement
and the Terms 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, subject to applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance
or transfer and similar laws affecting creditors' rights and
remedies generally and subject, as to enforceability, to
general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law) and
the discretion of the court before which any proceeding
therefor may be brought.
(vi) The Company has the requisite corporate power and
authority to execute, deliver and perform its obligations
under the Supplemental Indenture (if applicable) relating to
the Offered Securities, and the Supplemental Indenture (if
applicable) has been duly authorized, executed and delivered
by the Company and (assuming the due authorization, execution
and delivery by the Trustee under the Indenture relating to
the Offered Securities) constitutes a valid and legally
binding instrument of the Company, enforceable against the
Company in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance or transfer and similar laws affecting creditors'
rights and remedies generally and subject, as to
enforceability, to general principles of equity (regardless of
whether enforcement is sought in a proceeding in equity or at
law) and the discretion of the court before which any
proceeding therefor may be brought.
(vii) The statements set forth or incorporated by
reference in the Registration Statement and the Prospectus
insofar as such statements purport to summarize certain
provisions of the Offered Securities (and the Common Stock, if
applicable), the Indenture and the Supplemental Indenture
provide a fair summary of such provisions.
(viii) If the Prospectus contains a section entitled
"Capitalization", the number of authorized shares of capital
stock of the Company is as set
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forth in the Prospectus under "Capitalization". The authorized
capital stock of the Company conforms as to legal matters in
all material respects to the description thereof contained in
the Prospectus.
(ix) If the Offered Securities are convertible into
Common Stock, upon issuance and delivery of the Offered
Securities, the Offered Securities shall be convertible at the
option of the holder thereof into Common Stock in accordance
with the terms of the Offered Securities and the Supplemental
Indenture (if applicable) relating thereto; the Common Stock
issuable upon conversion of the Offered Securities have been
duly authorized and validly reserved for issuance upon such
conversion by all necessary corporate action, and such Common
Stock, when issued upon such conversion, will be validly
issued, fully paid and nonassessable; no holder of the Common
Stock will be subject to personal liability solely by reason
of being such a holder; and the issuance of such shares upon
such conversion will not be subject to preemptive rights
arising by operation of law or under the charter or by-laws of
the Company.
(x) All of the issued and outstanding capital stock of
each Subsidiary has been duly authorized and validly issued,
is fully paid and nonassessable and, to the best of such
counsel's knowledge and information, after due inquiry, except
as set forth in the Registration Statement and the Prospectus,
is owned by the Company, directly or indirectly, free and
clear of any perfected security interest, and, to the best of
such counsel's knowledge and information, after due inquiry,
any other security interests or claims.
(xi) Such counsel does not know of any legal or
governmental actions, suits or proceedings, pending or
threatened, required to be disclosed in the Registration
Statement which are not disclosed therein as required
(provided that for such purpose such counsel need not regard
any action, suit or proceeding to be "threatened" unless the
potential litigant has manifested to the management of the
Company or to such counsel a present intention to initiate
such suit or proceeding).
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(xii) To the best of such counsel's knowledge and
information, after due inquiry, there are no Contracts or
other instruments required to be described or referred to in
the Registration Statement or to be filed as exhibits thereto
other than those described or referred to therein or filed or
incorporated by reference as exhibits thereto.
(xiii) Based upon such counsel's review of applicable
law, no authorization, approval, consent or order of any court
or governmental or regulatory authority, body or agency or
third party is required in connection with (A) the offering,
issuance or sale of the Offered Securities or, if applicable,
the valid authorization, issuance and delivery of the Common
Stock issuable upon conversion of the Offered Securities, or
(B) the execution, delivery or full and timely performance of
this Agreement, the Terms Agreement, the Indenture, the
Supplemental Indenture (if applicable) or the Offered
Securities by the Company, except such as may be required
under the Securities Act, the Trust Indenture Act or state
securities laws.
(xiv) To the best of such counsel's knowledge and
information, after due inquiry, the execution, delivery and
the full and timely performance of this Agreement, the Terms
Agreement, the Indenture, the Supplemental Indenture (if
applicable) and the Offered Securities, the consummation of
the transactions contemplated herein (including the issuance,
sale and delivery of the Offered Securities and, if
applicable, the issuance of the Common Stock upon conversion
of the Offered Securities), and compliance by the Company with
its obligations hereunder and thereunder will not conflict
with or constitute a breach of, or default under (including,
without limitation, any event which, with notice or lapse of
time, or both, would constitute a breach of or a default
under), or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the
Company or any of the Subsidiaries pursuant to, any contract
identified on a schedule to such opinion (the scope of which
list of contracts being reasonably acceptable to the
Representatives), nor will such action result in any violation
of the provisions of the charter or by-laws of the Company, or
any applicable law, rule, regulation or administrative,
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regulatory or court judgment, order or decree, except for any
breach, default, lien, charge or encumbrance under any such
contract as could not, singly or in the aggregate, reasonably
be expected to have a Material Adverse Effect.
In addition, such counsel shall also include a statement to
the effect that nothing has come to the attention of such counsel which
leads such counsel to believe that (1) the Registration Statement
(other than the financial statements and schedules and other financial
and statistical data included or incorporated by reference therein, as
to which such counsel need not make any statement or express any
opinion), when it became effective and at the Representation Date
contained and, as of the date such opinion is delivered, contains any
untrue statement of a material fact or omitted on omits to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading and (2) the Prospectus (other than
the financial statements and schedules and other financial and
statistical data included or incorporated by reference therein, as to
which such counsel need not make any statement or express any opinion)
as of its date or at the Representation Date contained and, as of the
date such opinion is delivered, contains any untrue statement of a
material fact or omitted or omits to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
Such counsel in rendering such opinion may rely as to certain
matters of fact on certificates of officers of the Company and of
public officials; provided, however, that (a) such counsel shall state
that such counsel, the Underwriters and counsel for the Underwriters
are justified in relying upon such certificates and (b) such
certificates shall have been delivered to the Representatives prior to
the Closing Date. In rendering such opinion, such counsel may rely as
to matters involving the application of laws of (1) the General
Corporation Law of the State of Delaware upon the written opinion of
LSZHL delivered pursuant to clause (e) above of this Section 6 and (2)
any jurisdiction other than the State of Texas or the United States, to
the extent they deem proper and specified in such opinion, upon the
opinion of other counsel who are reasonably satisfactory to counsel for
the Underwriters; provided, however, that Xxxxx X. Shelger shall state
that Xxxxx X. Shelger, the
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Underwriters and counsel for the Underwriters are justified in relying
upon such opinion. In addition, such counsel may assume for purposes of
such opinion that the laws of the State of New York are identical to
the laws of the State of Texas.
(g) On the Representation Date and also on the Closing Date,
PricewaterhouseCoopers shall have furnished to the Representatives
signed letters, addressed to the Underwriters and dated the respective
dates of delivery thereof, in form and substance satisfactory to the
Representatives, containing statements and information of the type
customarily included in accountants' "comfort letters" to underwriters
with respect to the financial statements and certain financial
information included or incorporated by reference in the Registration
Statement and the Prospectus.
(h) The Representatives shall have received on and as of the
Closing Date a favorable opinion of Xxxxxx Xxxxxx & Xxxxxxx, counsel to
the Underwriters, with respect to the Registration Statement, the
Prospectus and other related matters as the Representatives may
reasonably request, and such counsel shall have received such papers
and information as they may reasonably request to enable them to pass
upon such matters.
(i) If the Offered Securities are convertible into Common
Stock, on the Representation Date, the Common Stock issuable upon
conversion of the Offered Securities shall have been approved for
listing on the New York Stock Exchange upon notice of issuance.
(j) At the Closing Date, counsel for the Underwriters shall
have been furnished with such documents and opinions as they may
require for the purpose of enabling them to pass upon the issuance and
sale of the Offered Securities as herein contemplated and related
proceedings, or in order to evidence the accuracy of any of the
representations or warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings taken by the Company
in connection with the issuance and sale of the Offered Securities
(and, if applicable, the Common Stock) as herein contemplated shall be
satisfactory in form and substance to the Underwriters and counsel for
the Underwriters.
(k) On or prior to the Closing Date the Company shall have
furnished to the Representatives such further certificates and
documents as the Representatives shall reasonably request.
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(l) Subsequent to the execution and delivery of the Terms
Agreement and prior to the Closing Date, there shall not have occurred
any downgrading, nor shall any notice have been given of (i) any
intended or potential downgrading or (ii) any review or possible change
that does not indicate an improvement, in the rating accorded any
securities of or guaranteed by the Company by any "nationally
recognized statistical rating organization," as such term is defined
for purposes of Rule 436(g)(2) under the Securities Act.
(m) If the Offered Securities are convertible into Common
Stock, the Company shall have delivered to the Representatives written
agreements, in form and substance satisfactory to the Representative
designated in the Terms Agreement, with each of its executive officers
who owns Common Stock that no offer, sale or other disposition, or
request or demand for registration under the Securities Act or
inclusion in any other registration statement filed by the Company
under the Securities Act, of any Common Stock or other capital stock of
the Company, or warrants, options, convertible, exercisable or
exchangeable securities, or other rights to purchase or acquire, Common
Stock or other capital stock (or any such right or exchangeable,
exercisable or convertible security) owned by such person, or with
respect to which such person has the power of disposition, will be made
for a period of 90 days after the date of this Agreement, directly or
indirectly, by such executive officer, otherwise than (i) with the
prior written consent of the Representative designated in the Terms
Agreement and (ii) pursuant to such exceptions, if any, as are agreed
to by the Representative designated in the Terms Agreement and set
forth in the Terms Agreement.
(n) There shall not have been any amendment or supplement to
the Registration Statement or the Prospectus to which the Underwriters
shall have objected.
(o) The Company shall have complied with its obligations under
Section 5(o).
The several obligations of the Underwriters designated in the
Terms Agreement to purchase Option Securities hereunder on the Additional
Closing Date are, unless otherwise agreed by the Underwriters designated in the
Terms Agreement,
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subject to the conditions set forth in paragraph (a) to and including paragraph
(n) above on and as of the Additional Closing Date (references therein to the
Closing Date shall be deemed references to the Additional Closing Date for this
purpose), except that the certificate called for by paragraph (d), the opinions
called for by paragraphs (e), (f) and (h) and the letters called for by
paragraph (g) shall be dated as of, and delivered on, the Additional Closing
Date, and to the delivery to the Representatives on the Additional Closing Date
of such other documents as they may reasonably request.
7. Indemnification and Contribution. The Company agrees to
indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and against any and all
losses, claims, damages and liabilities (including, without limitation the legal
fees and other expenses reasonably incurred in connection with defending or
investigating any such action or claim) caused by any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement or the Prospectus (as amended or supplemented if the Company shall
have furnished any amendments or supplements thereto) or any preliminary
prospectus, or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any untrue statement or omission or alleged untrue
statement or omission made in reliance upon and in conformity with information
relating to any Underwriter furnished to the Company in writing by such
Underwriter through the Representatives expressly for use therein; provided,
however, that the foregoing indemnity with respect to any preliminary prospectus
shall not inure to the benefit of any Underwriter (or the benefit of any person
controlling such Underwriter) from whom the person asserting any such losses,
claims, damages or liabilities purchased Offered Securities if such untrue
statement or omission or alleged untrue statement or omission was made in such
preliminary prospectus and is eliminated or remedied in the Prospectus and the
Company has provided such Prospectus in accordance with Section 5(b) hereof (as
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto) and if it shall be established in the related action or
proceeding that a copy of the Prospectus, if required by law (as so amended or
supplemented, but exclusive of any documents incorporated therein by reference),
shall not have been furnished to such person at or prior to the written
confirmation of the sale of such Offered Securities to such person, except to
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the extent that such Prospectus contains any other untrue statement or omission
or alleged untrue statement or omission of a material fact that was the subject
matter of the related action or proceeding. For purposes of the proviso to the
immediately preceding sentence, the term "Prospectus" shall not be deemed to
include the documents incorporated therein by reference, and no Underwriter
shall be obligated to send or give any supplement or amendment to any document
incorporated by reference in any preliminary prospectus or the Prospectus to any
person.
Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company, the directors of the Company, the
officers of the Company who sign the Registration Statement and each person, if
any, who controls the Company within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act from and against any and all
losses, claims, damages and liabilities (including, without limitation, any
legal or other expenses reasonably incurred in connection with defending or
investigating any such action or claim) caused by any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement or the Prospectus (as amended or supplemented if the Company shall
have furnished any amendments or supplements thereto) or any preliminary
prospectus, or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, but only with reference to information relating to such
Underwriter furnished to the Company in writing by such Underwriter through the
Representatives expressly for use in the Registration Statement, the Prospectus,
any amendment or supplement thereto, or any preliminary prospectus. For purposes
of this Section 7 and Section 4(ii), the only written information furnished by
the Underwriters to the Company expressly for use in the Registration Statement
and the Prospectus is the information in the last paragraph of the cover page of
the Prospectus Supplement and the third paragraph following the table under the
caption "Underwriting" in the Prospectus Supplement.
If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against
any person in respect of which indemnity may be sought pursuant to any of the
two preceding paragraphs of this Section 7, such person (hereinafter called the
"Indemnified Person") shall promptly notify the person against whom such
indemnity may be sought (hereinafter called the "Indemnifying Person") in
writing, and the Indemnifying
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Person, upon request of the Indemnified Person, shall promptly retain counsel
satisfactory to the Indemnified Person to represent the Indemnified Person in
such proceeding and shall pay the reasonable fees and expenses of such counsel
related to such proceeding. In any such proceeding, any Indemnified Person shall
have the right to retain its own counsel, but the fees and expenses of such
counsel shall be at the expense of such Indemnified Person unless (i) the
Indemnifying Person and the Indemnified Person shall have mutually agreed to the
contrary, (ii) there has been a failure by the Indemnifying Person to retain
promptly counsel reasonably satisfactory to the Indemnified Person or (iii) the
named parties to any such proceeding (including any impleaded parties) include
both the Indemnifying Person and the Indemnified Person and representation of
both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood that the
Indemnifying Person shall not, in connection with any proceeding or related
proceeding in the same jurisdiction, be liable for (a) the fees and expenses of
more than one separate firm (in addition to any local counsel) for all
Underwriters and all persons, if any, who control any Underwriter within the
meaning of either Section 15 of the Securities Act or Section 20 of the Exchange
Act or (b) the fees and expenses of more than one separate firm (in addition to
any local counsel) for the Company, its directors, its officers who sign the
Registration Statement and each person, if any, who controls the Company within
the meaning of either such Section, as the case may be, and that all such fees
and expenses shall be reimbursed as they are incurred. In the case of any such
separate firm for the Underwriters and such control persons of Underwriters,
such firm shall be designated in writing by the Representatives. In the case of
any such separate firm for the Company, and such directors, officers and control
persons of the Company, such firm shall be designated in writing by the Company.
The Indemnifying Person 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 Person agrees to
indemnify any Indemnified Person from and against any loss or liability by
reason of such settlement or judgment. Notwithstanding the foregoing sentence,
if at any time an Indemnified Person shall have requested an Indemnifying Person
to reimburse the Indemnified Person for fees and expenses of counsel as
contemplated by the third sentence of this paragraph, the Indemnifying Person
agrees that it shall be liable for any settlement of any proceeding effected
without its written consent if (i) such settlement is entered into more than 30
days after receipt by such Indemnifying Person of the aforesaid request and (ii)
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such Indemnifying Person shall not have reimbursed the Indemnified Person in
accordance with such request prior to the date of such settlement; provided,
however, that the Indemnifying Person shall not be liable for any settlement
effected without its consent pursuant to this sentence if the Indemnifying
Person is contesting in good faith the request for reimbursement and all other
fees and expenses of counsel not so contested shall have been reimbursed. No
Indemnifying Person shall, without the prior written consent of the Indemnified
Person, effect any settlement of any pending or threatened proceeding in respect
of which any Indemnified Person is or could have been a party and indemnity
could have been sought hereunder by such Indemnified Person, unless such
settlement (1) includes an unconditional written release of such Indemnified
Person, in form and substance satisfactory to such Indemnified Person, from all
liability on claims that are the subject matter of such proceeding and (2) does
not include any statement as to an admission of fault, culpability or failure to
act by or on behalf of any Indemnified Person.
If the indemnification provided for in the first or second
paragraph of this Section 7 is unavailable to any extent to an Indemnified
Person under such paragraph in respect of any losses, claims, damages or
liabilities referred to therein, then each Indemnifying Person under such
paragraph, in lieu of indemnifying such Indemnified Person thereunder, shall
contribute to the amount paid or payable by such Indemnified Person as a result
of such losses, claims, damages or liabilities as follows: as between the
Company on the one hand and the Underwriters on the other (i) in such proportion
as is appropriate to reflect the aggregate relative benefits received by the
Company and by the Underwriters from the offering of the Offered 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 and of the Underwriters in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. The relative benefits received
by the Company on the one hand and by the Underwriters on the other shall be
deemed to be in the same respective proportions as the net proceeds from the
offering (before deducting expenses) received by the Company and the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth in the table on the cover of the Prospectus bear to the
aggregate public offering price of the Offered Securities. The relative fault of
the Company on the one hand and of the
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Underwriters on the other shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section 7 were determined by
pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an Indemnified Person as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such Indemnified
Person in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, in no event shall an
Underwriter be required to contribute any amount in excess of the amount by
which the total price at which the Offered Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages that such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Underwriters'
obligations to contribute pursuant to this Section 7 are several in proportion
to the respective number of Offered Securities they have purchased hereunder,
and not joint.
The indemnity and contribution agreements contained in this
Section 7 are in addition to any liability which the Indemnifying Persons may
otherwise have to the Indemnified Persons referred to above.
The indemnity and contribution agreements contained in this
Section 7 and the representations and warranties of the Company contained in
this Agreement shall remain operative and in full force and effect regardless of
(i) any termination of this Agreement, (ii) any investigation made by or on
behalf of any Underwriter or any person controlling any Underwriter or the
Company, its officers or directors or any other person controlling the Company
and (iii) acceptance of and payment for any of the Offered Securities.
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8. Termination of Agreement. Notwithstanding anything herein
contained, this Agreement (or the obligations of the several Option Securities
Underwriters with respect to the Option Securities) may be terminated in the
absolute discretion of the Representatives, by notice given to the Company, if
after the execution and delivery of this Agreement and prior to the Closing Date
(or, in the case of the Option Securities, prior to the Additional Closing Date)
(i) trading generally shall have been suspended or materially limited on or by,
as the case may be, any of the New York Stock Exchange, the National Association
of Securities Dealers, Inc. or the American Stock Exchange, (ii) trading of any
securities of the Company shall have been suspended on any exchange or in any
over-the-counter market, (iii) a general moratorium on commercial banking
activities in New York shall have been declared by either U.S. Federal or New
York State authorities or exchange controls shall have been imposed by the
United States, or (iv) there shall have occurred any outbreak or escalation of
hostilities or any change in financial markets or any calamity or crisis that,
in the judgment of the Representatives, is material and adverse and which, in
the judgment of the Representatives, makes it impracticable to market the
Offered Securities on the terms and in the manner contemplated in the
Prospectus.
9. Effectiveness of Agreement; Additional Obligations of the
Underwriters. This Agreement shall become effective upon the later of (x) the
Representation Date and (y) release of notification by the Commission of the
effectiveness of the most recent amendment to the Registration Statement filed
prior to the Closing Date.
If, on the Closing Date or the Additional Closing Date, as the
case may be, any one or more of the Underwriters shall fail or refuse to
purchase the aggregate principal amount of Offered Securities which it or they
have agreed to purchase hereunder on such date, and the aggregate principal
amount of Offered Securities which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase is not more than one-tenth of the
aggregate principal amount of Offered Securities to be purchased on such date,
the other Underwriters (with respect to the Option Securities, to the extent
such Underwriters are Option Securities Underwriters) shall be obligated
severally in the proportions that (1) with respect to Underwritten Securities,
the aggregate principal amount of Underwritten Securities set forth opposite
their respective names in
44
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the annex or annexes to Exhibit I hereto bears to the aggregate principal amount
of Underwritten Securities set forth opposite the names of all such
non-defaulting Underwriters and (2) with respect to Option Securities, the
aggregate principal amount of Underwritten Securities set forth opposite their
respective names in the annex or annexes to Exhibit I hereto bears to the
aggregate principal amount of Underwritten Securities set forth opposite the
names of all such non-defaulting Underwriters who are Option Securities
Underwriters, or in such other proportions as the Representatives may specify,
to purchase the aggregate principal amount of Offered Securities which such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
on such date; provided, however, that in no event shall the aggregate principal
amount of Offered Securities that any Underwriter has agreed to purchase
pursuant to Section 1 be increased pursuant to this Section 9 by an amount in
excess of one-ninth of such aggregate principal amount of Offered Securities
without the written consent of such Underwriter. If, on the Closing Date or the
Additional Closing Date, as the case may be, any Underwriter or Underwriters
shall fail or refuse to purchase the aggregate principal amount of Offered
Securities which it or they have agreed to purchase hereunder on such date, and
the aggregate principal amount of Offered Securities with respect to which such
default occurs is more than one-tenth of the aggregate principal amount of
Offered Securities to be purchased on such date, and arrangements satisfactory
to the Representatives and the Company for the purchase of such aggregate
principal amount of Offered Securities are not made within 36 hours after such
default, this Agreement (or the obligations of the several Underwriters to
purchase the Option Securities, as the case may be) shall terminate without
liability on the part of any non-defaulting Underwriter or the Company. In any
such case either the Representatives or the Company shall have the right to
postpone the Closing Date (or, in the case of the Option Securities, the
Additional Closing Date), but in no event for longer than seven days, in order
that the required changes, if any, in the Registration Statement and in the
Prospectus or in any other documents or arrangements may be effected. Any action
taken under this paragraph shall not relieve any defaulting Underwriter from
liability in respect of any default of such Underwriter under this Agreement.
10. Reimbursement upon Occurrence of Certain Events. If this
Agreement shall be terminated by the Underwriters, or any of them, because of
any failure or refusal on the part of the Company to comply with the terms or to
fulfill any of the conditions of this Agreement, or if for any reason the
45
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Company shall be unable to perform its obligations under this Agreement, the
Company agrees to reimburse the Underwriters or such Underwriters as have so
terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and expenses of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder and pursuant to the Terms Agreement. In no
event, however, shall the Company be responsible to the Underwriters for any
loss of profits for failure to consummate the offering and sale of the Offered
Securities.
11. Miscellaneous. This Agreement shall inure to the benefit
of and be binding upon the Company, the Underwriters, any controlling persons
referred to herein and their respective successors and assigns. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to
give any other person, firm or corporation any legal or equitable right, remedy
or claim under or in respect of this Agreement or any provision herein
contained. No purchaser of Offered Securities from any Underwriter shall be
deemed to be a successor by reason merely of such purchase.
12. Notice. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be given to the Representatives at the addresses as set forth
in the Terms Agreement. Notices to the Company shall be given to it at Service
Corporation International, 0000 Xxxxx Xxxxxxx, Xxxxxxx, Xxxxx 00000 (facsimile:
(000) 000-0000); Attention: Xxxxx X. Shelger.
13. Counterparts; Applicable Law. This Agreement may be signed
in counterparts, each of which shall be an original and all of which together
shall constitute one and the same instrument. This Agreement shall be governed
by and construed in accordance with the laws of the State of New York applicable
to contracts made and to be performed wholly therein, without giving effect to
the conflicts of laws provisions thereof.
46
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If the foregoing is in accordance with your understanding,
please sign and return six counterparts hereof.
Very truly yours,
SERVICE CORPORATION INTERNATIONAL
By: /s/ XXXXX X. SHELGER
------------------------------------
Name: Xxxxx X. Shelger
Title: Senior Vice President,
General Counsel and Secretary
CONFIRMED AND ACCEPTED,
as of the date first above written
CHASE SECURITIES INC.
X.X. XXXXXX SECURITIES INC.
NATIONSBANC XXXXXXXXXX SECURITIES LLC
XXXXXXX XXXXXXX READ LLC
ABN AMRO INCORPORATED
CREDIT SUISSE FIRST BOSTON CORPORATION
XX XXXXX SECURITIES CORPORATION
By: CHASE SECURITIES INC.
By: /s/ XXXXX X. XXXXXXX
---------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Managing Director
By: X.X. XXXXXX SECURITIES INC.
By: /s/ XXXXXXX XXXXXXX
---------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Vice President
47
EXHIBIT I
SERVICE CORPORATION INTERNATIONAL
$600,000,000
6.0% Notes due 2005
TERMS AGREEMENT
December 8, 1998
Service Corporation International
0000 Xxxxx Xxxxxxx
Xxxxxxx, Xxxxx 00000
Attention: Xxxxx X. Shelger
Ladies and Gentlemen:
Chase Securities Inc. and X.X. Xxxxxx Securities Inc.
(collectively, the "Representatives"), NationsBanc Xxxxxxxxxx Securities LLC,
Warburg Dillon Read LLC, ABN AMRO Incorporated, Credit Suisse First Boston
Corporation and XX Xxxxx Securities Corporation understand that Service
Corporation International, a Texas corporation (the "Company"), proposes to
issue and sell $600,000,000 aggregate principal amount of its 6.0% Notes due
2005 (the "Notes") (the "Underwritten Securities"). The Notes are Senior Debt
Securities and are to be issued under the Senior Indenture. Subject to the terms
and conditions set forth herein or incorporated by reference herein, the
Underwriters named in Annex A attached hereto offer to purchase, severally and
not jointly, the aggregate principal amount of Underwritten Securities set forth
opposite the name of each such Underwriter on Annex A hereto at a price of
98.737% of the principal amount thereof (the "Purchase Price"). The Closing Date
shall be December 11, 1998, at 9:00 A.M., New York City time, at the offices of
Xxxxxx Xxxxxx & Xxxxxxx.
48
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The Underwritten Securities shall have the following terms:
Title: 6.0% Notes due 2005
Maturity: December 15, 2005
Interest rate: 6.0% per annum
Interest payment dates: June 15 and December 15, commencing June 15,
1999
Record Dates: June 1 and December 1
Redemption at option of Company: At any time, subject to a makewhole
using a discount rate equal to the yield to maturity of a
comparable treasury issue plus 15 basis points.
Sinking fund provisions: None
Public offering price: 99.362% of the principal amount thereof
All the provisions contained in the document entitled
"Underwriting Agreement -- Service Corporation International -- Debt Securities"
(the "Underwriting Agreement") and dated December 8, 1998, a copy of which you
have previously received, are herein incorporated by reference in their entirety
and shall be deemed to be a part of this Terms Agreement to the same extent as
if the Underwriting Agreement had been set forth in full herein. Terms defined
in the Underwriting Agreement are used herein as therein defined.
The text of the first sentence of Section 5(h) of the
Underwriting Agreement is hereby deleted for purposes of the purchase and sale
of the Notes and the following shall be deemed inserted therein in lieu thereof:
"For a period beginning on the Representation Date to and including the Business
Day following the Closing Date, not to, and not to cause or permit any
subsidiary of the Company to, directly or indirectly, effect any offer, sale or
other disposition of, or registration of, any debt securities or any other
long-term debt, notes or debentures of or guaranteed by the Company or any of
its Subsidiaries which are substantially similar to the Notes (which expressly
shall be deemed not to include any debt securities or guarantees of debt
securities issued under the S-4) without the prior written consent of the
Representatives."
Any action by the Underwriters hereunder may be taken by the
Representatives jointly on behalf of the Underwriters. Notices to the
Underwriters shall be given to the Representatives c/o Chase Securities Inc.,
000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (facsimile: (000) 000-0000);
Attention: Xxxxx Xxxxxxx, and X.X. Xxxxxx Securities Inc., 00 Xxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000 (facsimile: (000) 000-0000); Attention: Syndicate
Department.
49
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This Agreement may be signed in counterparts, each of which
shall be an original and all of which together shall constitute one and the same
instrument. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York applicable to contracts made and to be
performed wholly in such state, without giving effect to the conflicts of laws
provisions thereof. Times referred to herein are to New York City time.
50
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Please accept this offer no later than December 8, 1998 by
signing a copy of this Terms Agreement in the space set forth below and
returning the signed copy to us, or by sending us a written acceptance in the
following form:
"We hereby accept your offer, set forth in the Terms
Agreement, dated December 8, 1998, to purchase the Underwritten Securities on
the terms set forth therein and agree to and accept all other terms and
provisions of the Terms Agreement."
Very truly yours,
CHASE SECURITIES INC.
X.X. XXXXXX SECURITIES INC.
NATIONSBANC XXXXXXXXXX
SECURITIES LLC
WARBURG DILLON READ LLC
ABN AMRO INCORPORATED
CREDIT SUISSE FIRST BOSTON
CORPORATION
XX XXXXX SECURITIES CORPORATION
By: CHASE SECURITIES INC.
By:
----------------------------
Name:
Title:
By: X.X. XXXXXX SECURITIES INC.
By:
----------------------------
Name:
Title:
Accepted as of the date first above written:
SERVICE CORPORATION INTERNATIONAL
By:
-----------------------------------------
Name:
Title:
51
ANNEX A
Aggregate
Principal Amount
of Underwritten
Securities
Underwriters To Be Purchased
------------ ---------------
Chase Securities Inc................................ $195,000,000
X.X. Xxxxxx Securities Inc.......................... 195,000,000
NationsBanc Xxxxxxxxxx Securities LLC............... 60,000,000
Warburg Dillon Read LLC............................. 60,000,000
ABN Amro Incorporated............................... 30,000,000
Credit Suisse First Boston Corporation.............. 30,000,000
XX Xxxxx Securities Corporation..................... 30,000,000
------------
Total: $600,000,000
============
52
SCHEDULE I
Significant Subsidiaries of the Company
within the meaning of Rule 1-02 of
Regulation S-X under the Securities
Exchange Act of 1934.
Investment Capital Corporation, a Texas corporation
SCI Funeral Services of New York, Inc., a New York corporation
SCI Funeral Services, Inc., an Iowa corporation
SCI International Limited, a Delaware corporation
SCI Texas Funeral Services, Inc., a Texas corporation
SCIT Holdings, Inc., a Delaware corporation
OGF-PFG, a French corporation
Service Corporation International France, a French corporation
