POTASH CORPORATION OF SASKATCHEWAN INC.
Debt Securities
UNDERWRITING AGREEMENT
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1. Introductory. Potash Corporation of Saskatchewan Inc., a company
incorporated under the laws of the Province of Saskatchewan, Canada (the
"Company"), proposes to issue and sell from time to time certain of its
unsecured debt securities registered under the registration statement referred
to in Section 2(a) (the "Registered Securities"). The Registered Securities will
be issued under an indenture, dated as of June 16, 1997 (the "Indenture"),
between the Company and The Bank of Nova Scotia Trust Company of New York, as
trustee, in one or more series, which series may vary as to interest rates,
maturities, redemption provisions, selling prices and other terms, with all such
terms for any particular series of the Registered Securities being determined at
the time of sale. Particular series of the Registered Securities will be sold
pursuant to a Terms Agreement referred to in Section 3, for resale in accordance
with terms of offering determined at the time of sale.
The Registered Securities involved in any such offering are hereinafter
referred to as the "Offered Securities". The firm or firms that agree to
purchase the Offered Securities are hereinafter referred to as the
"Underwriters" of such securities, and the representative or representatives of
the Underwriters, if any, specified in a Terms Agreement referred to in Section
3 are hereinafter referred to as the "Representatives"; provided, however, that
if the Terms Agreement does not specify any representative of the Underwriters,
the term "Representatives", as used in this Agreement (other than in Sections
2(b), 5(c) and 6 and the second sentence of Section 3), shall mean the
Underwriters.
2. Representations and Warranties of the Company. The Company, as of
the date of each Terms Agreement referred to in Section 3, represents and
warrants to, and agrees with, each Underwriter that:
(a) Registration Statement Effective. A registration statement (No.
333-27685), including a prospectus, relating to the Registered
Securities has been filed with the Securities and Exchange Commission
(the "Commission") and has become effective. Such registration
statement, as amended at the time of any Terms Agreement referred to in
Section 3, is hereinafter referred to as the "Registration Statement",
and the prospectus included in such Registration Statement, as
supplemented as contemplated by Section 3 to reflect the terms of the
Offered Securities and the terms of offering thereof, as first filed
with the Commission pursuant to and in accordance with Rule 424(b)
("Rule 424(b)") under the Securities Act of 1933 (the "Securities
Act"), including all material incorporated by reference therein, is
hereinafter referred to as the "Prospectus". No document has been or
will be prepared or distributed in reliance on Rule 434 under the
Securities Act.
(b) Registration Statement Not Misleading. On the effective date of
the Registration Statement, the Registration Statement conformed in all
material respects to the requirements of the Securities Act and the
Trust Indenture Act of 1939 ("Trust Indenture Act") and the rules and
regulations of the Commission thereunder ("Rules and Regulations") and
did not include any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading, and on the date of each
Terms Agreement referred to in Section 3, the Registration Statement
and the Prospectus will conform in all material respects to the
requirements of the Securities Act, the Trust Indenture Act and the
Rules and Regulations, and neither of such documents will include any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading, except that the foregoing does not apply to
statements in or omissions from any of such documents based upon
written information furnished to the Company by any Underwriter through
the Representatives, if any, specifically for use therein.
(c) Taxation. Subject to the assumptions, limitations,
qualifications and conditions set forth therein, the statements made in
the Prospectus under the heading "Canadian Federal Income Tax
Considerations" in the prospectus supplement, insofar as they relate to
matters of Canadian federal income tax law, constitute a fair summary
of the matters so discussed and applicable to the holders of Offered
Securities described therein.
(d) Incorporation of the Company. The Company has been duly
incorporated and is an existing corporation under the laws of the
Province of Saskatchewan, Canada, with power and authority (corporate
and other) to own its properties and conduct its business as described
in the Prospectus; and the Company is duly qualified or registered to
do business in all other jurisdictions in which its ownership or lease
of property or the conduct of its business requires such qualification
or registration, except where the failure to be so qualified or
registered would not individually or in the aggregate have a material
adverse effect on the condition (financial or otherwise), business,
properties or results of operations of the Company and its subsidiaries
taken as one enterprise (a "Material Adverse Effect").
(e) Organization of Subsidiaries. Each material subsidiary of the
Company is set forth on Schedule A hereto (each, a "Subsidiary"). Each
Subsidiary is a corporation or limited partnership duly incorporated or
organized, as the case may be, existing in good standing under the laws
of the jurisdiction of its incorporation or organization, with power
and authority (corporate and other) to own its properties and conduct
its business as described in the Prospectus; and each Subsidiary is
duly qualified or registered to do business as a foreign corporation or
limited partnership in good standing in all other jurisdictions in
which its ownership or lease of property or the conduct of its business
requires such qualification or registration, except where the failure
to be so qualified or registered would not individually or in the
aggregate have a Material Adverse Effect; all of the issued and
outstanding capital stock of each Subsidiary has been duly authorized
and validly issued and is fully paid and nonassessable; and the capital
stock of each Subsidiary is owned directly or indirectly by the Company
free from liens, encumbrances and defects incurred or arising otherwise
than in the ordinary course of business.
(f) Authorization of Indenture and Offered Securities. The Indenture
has been duly authorized, executed and delivered and has been duly
qualified under the Trust Indenture Act; the Offered Securities have
been duly authorized; and when the Offered Securities are delivered and
paid for pursuant to the Terms Agreement on the Closing Date (as
defined below) or pursuant to Delayed Delivery Contracts (as defined
below), such Offered Securities will have been duly executed,
authenticated, issued and delivered and will conform in all material
respects to the description thereof contained in the Prospectus and the
Indenture, and such Offered Securities will constitute valid and
legally binding obligations of the Company, enforceable in accordance
with their terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles.
(g) No Consents. No consent, approval, authorization, or order of,
or filing with, any governmental agency or body or any court is
required for the consummation by the Company of the transactions
contemplated by the Terms Agreement (including the provisions of this
Agreement) in connection with the issuance and sale of the Offered
Securities by the Company, except such as have been obtained and made
under the Securities Act and the Trust Indenture Act and such as may be
required under state securities laws or the securities laws of any
jurisdiction outside the United States in which the Offered Securities
are offered and sold.
(h) No Breach or Default. The execution, delivery and performance by
the Company of the Indenture, the Terms Agreement (including the
provisions of this Agreement) and any Delayed Delivery Contracts and
the issuance and sale of the Offered Securities and compliance with the
terms and provisions thereof by the Company will not result in a breach
or violation of any of the terms and provisions of, or constitute a
default under, any statute, any rule, regulation or order of any
governmental agency or body or any court, domestic or foreign, having
jurisdiction over the Company or any Subsidiary or any of their
properties, or any material agreement or instrument to which the
Company or any Subsidiary is a party or by which the Company or any
Subsidiary is bound or to which any of the properties of the Company or
any Subsidiary is subject, or the charter or by-laws of the Company or
any Subsidiary.
(i) Authorization of Terms Agreement. The Terms Agreement (including
the provisions of this Agreement) and any Delayed Delivery Contracts
have been duly authorized, executed and delivered by the Company.
(j) Properties. Except as disclosed in the Prospectus, the Company
and the Subsidiaries have good and marketable title to all real
properties and all other properties and assets described in the
Prospectus as being owned by them, in each case free from liens,
encumbrances and defects that would materially affect the value thereof
or materially interfere with the use made or to be made thereof by
them, except to the extent that the failure to hold any such title
would not have a Material Adverse Effect; and, except as disclosed in
the Prospectus, the Company and the Subsidiaries hold any leased real
or personal property described in the Prospectus as being leased by
them under valid and enforceable leases with no exceptions that would
materially interfere with the use made or to be made thereof by them,
except to the extent that the failure so to hold any such leased
property would not individually or in the aggregate have a Material
Adverse Effect.
(k) Permits. Except as disclosed in the Prospectus, the Company and
the Subsidiaries possess adequate certificates, approvals, licenses,
franchises, authorizations or permits issued by appropriate
governmental agencies or bodies necessary to conduct the business now
operated by them ("Permits"), except where the failure to have any such
Permit would not individually or in the aggregate have a Material
Adverse Effect; and, except as disclosed in the Prospectus, the Company
and the Subsidiaries have not received any notice of proceedings
relating to the revocation or modification of any Permit that, if
determined adversely to the Company or any of the Subsidiaries, would
individually or in the aggregate have a Material Adverse Effect.
(l) Labor. No labor dispute with the employees of the Company or any
Subsidiary exists or, to the knowledge of the Company, is threatened
that would have a Material Adverse Effect.
(m) Intellectual Property. The Company and the Subsidiaries own,
possess or can acquire on reasonable terms, adequate trademarks, trade
names and other rights to inventions, know-how, patents, copyrights,
confidential information and other intellectual property presently
employed by them or necessary to conduct the business now operated by
them (collectively, "intellectual property rights"), and have not
received any notice of infringement of or conflict with asserted rights
of others with respect to any intellectual property rights that, if
determined adversely to the Company or any of the Subsidiaries, would
individually or in the aggregate have a Material Adverse Effect.
(n) Environmental Laws. Except as disclosed in the Prospectus,
neither the Company nor any of the Subsidiaries is in violation of any
statute, rule, regulation, decision or order of any governmental agency
or body or any court, domestic or foreign, relating to the use,
disposal or release of hazardous or toxic substances or relating to the
protection or restoration of the environment or human exposure to
hazardous or toxic substances (collectively, "Environmental Laws"),
owns or operates any real property contaminated with any substance
required to be remediated under any Environmental Laws, or, to the
Company's knowledge, is liable for any off-site disposal or
contamination pursuant to any Environmental Laws or is subject to any
claim under any Environmental Laws, which violation, contamination,
liability or claim would individually or in the aggregate have a
Material Adverse Effect; and, except as disclosed in the Prospectus,
the Company is not aware of any pending investigation that would be
likely to lead to such a claim. In addition, based upon the Company's
reviews, conducted in the ordinary course of its business, of the
effect of Environmental Laws on the business and operations of the
Company and the Subsidiaries, the Company has reasonably concluded
that, except as disclosed in the Prospectus, the costs and liabilities
under Environmental Laws (including, without limitation, any capital or
operating expenditures required for clean-up, closure or rehabilitation
of properties or compliance with Environmental Laws or any Permit, any
related constraints on operating activities and potential liabilities
to third parties) would not, individually or in the aggregate, have a
Material Adverse Effect.
(o) No Material Litigation. Except as disclosed in the Prospectus,
there are no pending actions, suits or proceedings against or affecting
the Company, any of the Subsidiaries or any of their respective
properties that, if determined adversely to the Company or any of its
Subsidiaries, would individually or in the aggregate have a Material
Adverse Effect, or would materially and adversely affect the ability of
the Company to perform its obligations under the Indenture, the Terms
Agreement (including the provisions of this Agreement) or any Delayed
Delivery Contracts; and no such actions, suits or proceedings are, to
the Company's knowledge, threatened.
(p) Financial Statements. The financial statements included in the
Registration Statement and Prospectus present fairly the financial
position of the Company and its consolidated subsidiaries as of the
dates shown and their results of operations and cash flows for the
periods shown, and such financial statements have been prepared in
conformity with generally accepted accounting principles in Canada
applied on a consistent basis; and any schedules included in the
Registration Statement present fairly the information required to be
stated therein. Such financial statements have also been reconciled to
generally accepted accounting principles in the United States in
accordance with the requirements of the Securities Act and the Rules
and Regulations thereunder.
(q) No Material Adverse Change. Except as disclosed in the
Prospectus, since the date of the latest audited financial statements
included in the Prospectus, there has been no material adverse change,
nor any development or event involving a prospective material adverse
change, in the condition (financial or other), business, properties or
results of operations of the Company and its subsidiaries taken as one
enterprise; and, except as disclosed or contemplated in the Prospectus,
and other than the Company's ordinary quarterly dividends, there has
been no other dividend or distribution of any kind declared, paid or
made by the Company on any class of its capital stock.
(r) Investment Company Act. The Company is not and, after giving
effect to the offering and sale of the Offered Securities and the
application of the proceeds thereof as described in the Prospectus,
will not be an "investment company" as defined in the Investment
Company Act of 1940.
3. Purchase and Offering of Offered Securities. The obligation of the
Underwriters to purchase the Offered Securities will be evidenced by an
agreement (the "Terms Agreement") at the time the Company determines to sell the
Offered Securities. The Terms Agreement will incorporate by reference the
provisions of this Agreement, except as otherwise provided therein, and will
specify the firm or firms that will be the Underwriters, the names of any
Representatives, the principal amount to be purchased by each Underwriter, the
purchase price to be paid by the Underwriters and the terms of the Offered
Securities not already specified in the Indenture, including, but not limited
to, interest rate, maturity, any redemption provisions and any sinking fund
requirements and whether any of the Offered Securities may be sold to
institutional investors pursuant to Delayed Delivery Contracts (as defined
below). The Terms Agreement will also specify the time and date of delivery and
payment (such time and date, or such other time not later than seven full
business days thereafter as the Underwriter first named in the Terms Agreement
(the "Lead Underwriter") and the Company agree as the time for payment and
delivery, being herein and in the Terms Agreement referred to as the "Closing
Date"), the place of delivery and payment and any details of the terms of
offering that should be reflected in the prospectus supplement relating to the
offering of the Offered Securities. For purposes of Rule 15c6-1 under the
Securities Exchange Act of 1934 (the "Exchange Act"), the Closing Date (if later
than the otherwise applicable settlement date) shall be the date for payment of
funds and delivery of securities for all the Offered Securities sold pursuant to
the offering, other than Contract Securities (as defined below) for which
payment of funds and delivery of securities shall be as hereinafter provided.
The obligations of the Underwriters to purchase the Offered Securities will be
several and not joint. It is understood that the Underwriters propose to offer
the Offered Securities for sale as set forth in the Prospectus.
On the Closing Date, the Company will pay, as an underwriting fee in
respect of the public distribution of the Offered Securities, to the
Underwriters, the fee set forth in the Terms Agreement (the "Underwriting Fee").
Such Underwriting Fee may be paid by the Company to the Underwriters by setting
off the Underwriting Fee payable by the Company to the Underwriters against the
amount payable by the Underwriters to the Company as the purchase price for the
Offered Securities.
If the Terms Agreement provides for sales of Offered Securities
pursuant to delayed delivery contracts, the Company authorizes the Underwriters
to solicit offers to purchase Offered Securities pursuant to delayed delivery
contracts substantially in the form of Annex I attached hereto ("Delayed
Delivery Contracts") with such changes therein as the Company may authorize or
approve. Delayed Delivery Contracts are to be with institutional investors,
including commercial and savings banks, insurance companies, pension funds,
investment companies and educational and charitable institutions. On the Closing
Date, the Company will pay, as compensation, to the Representatives for the
accounts of the Underwriters, the fee set forth in such Terms Agreement in
respect of the principal amount of Offered Securities to be sold pursuant to
Delayed Delivery Contracts ("Contract Securities"). The Underwriters will not
have any responsibility in respect of the validity or the performance of Delayed
Delivery Contracts. If the Company executes and delivers Delayed Delivery
Contracts, the Contract Securities will be deducted from the Offered Securities
to be purchased by the several Underwriters and the aggregate principal amount
of Offered Securities to be purchased by each Underwriter will be reduced pro
rata in proportion to the principal amount of Offered Securities set forth
opposite each Underwriter's name in such Terms Agreement, except to the extent
that the Lead Underwriter determines that such reduction shall be otherwise than
pro rata and so advises the Company. The Company will advise the Lead
Underwriter not later than the business day prior to the Closing Date of the
principal amount of Contract Securities.
If the Terms Agreement specifies "Book-Entry Only" settlement or
otherwise states that the provisions of this paragraph shall apply, the Company
will deliver against payment of the purchase price the Offered Securities in the
form of one or more permanent global securities in definitive form (the "Global
Securities") deposited with the Trustee as custodian for The Depository Trust
Company ("DTC") and registered in the name of Cede & Co., as nominee for DTC.
Interests in any permanent global securities will be held only in book-entry
form through DTC, except in the limited circumstances described in the
Prospectus. Payment for the Offered Securities shall be made by the Underwriters
in Federal (same day) funds by wire transfer to an account previously designated
by the Company at a bank acceptable to the Lead Underwriter, in each case drawn
to the order of the Company at the place of payment specified in the Terms
Agreement on the Closing Date, against delivery to the Trustee as custodian for
DTC of the Global Securities representing all of the Offered Securities.
Each Underwriter agrees that it will not offer or sell, directly or
indirectly, any of the Offered Securities in any jurisdiction where such offer
or sale is not permitted. Each Underwriter further agrees that it will not (i)
offer or sell, directly or indirectly, any Offered Securities in Canada or any
province or territory thereof in contravention of the securities laws of Canada
or any province or territory thereof or (ii) distribute any material related to
the Offered Securities in Canada in contravention of the securities laws of
Canada or any province or territory thereof.
4. Certain Agreements of the Company. The Company agrees with the
several Underwriters that it will furnish to counsel for the Underwriters, one
signed copy of the Registration Statement, including all exhibits, in the form
it became effective and of all amendments thereto and that, in connection with
each offering of Offered Securities:
(a) File Prospectus. The Company will file the Prospectus with the
Commission pursuant to and in accordance with Rule 424(b)(2) (or, if
applicable and if consented to by the Lead Underwriter, subparagraph
(5)) not later than the second business day following the execution and
delivery of the Terms Agreement.
(b) Amendments to Registration Statement or Prospectus. The Company
will advise the Lead Underwriter promptly of any proposal to amend or
supplement the Registration Statement or the Prospectus and will afford
the Lead Underwriter a reasonable opportunity to comment on any such
proposed amendment or supplement; and the Company will also advise the
Lead Underwriter promptly of the filing of any such amendment or
supplement and of the institution by the Commission of any stop order
proceedings in respect of the Registration Statement or of any part
thereof and will use its reasonable best efforts to prevent the
issuance of any such stop order and to obtain as soon as possible its
lifting, if issued.
(c) Material Changes. If, at any time when a prospectus relating to
the Offered Securities is required to be delivered under the Securities
Act in connection with sales by any Underwriter or dealer, any event
occurs as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or
omit to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading, or if it is necessary at any time to amend the
Prospectus to comply with the Securities Act, the Company promptly will
notify the Lead Underwriter of such event and will promptly prepare and
file with the Commission, at its own expense, an amendment or
supplement that will correct such statement or omission or an amendment
that will effect such compliance. Neither the Lead Underwriter's
consent to, nor the Underwriters' delivery of, any such amendment or
supplement shall constitute a waiver of any of the conditions set forth
in Section 5 hereof.
(d) Delivery of Earnings Statement. As soon as practicable after the
date of each Terms Agreement, the Company will make generally available
to its securityholders an earnings statement or statements covering a
period of at least 12 months beginning after the later of (i) the
effective date of the registration statement relating to the Registered
Securities, (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, that will satisfy the provisions
of Section 11(a) of the Securities Act and Rule 158 thereunder.
(e) Delivery of Registration Statement and Prospectus. The Company
will furnish to the Representatives copies of the Registration
Statement, including all exhibits, any related preliminary prospectus
supplement, the Prospectus and all amendments and supplements to such
documents, in each case as soon as available and in such quantities as
the Lead Underwriter reasonably requests. The Company will pay the
reasonable expenses of printing and distributing to the Underwriters
all such documents.
(f) Qualification of Offered Securities. The Company will cooperate
with the Representatives and with counsel for the Underwriters in
connection with the qualification of the Offered Securities for sale
and the determination of their eligibility for investment under the
laws of such jurisdictions in the United States as the Lead Underwriter
may reasonably designate and will continue such qualifications in
effect so long as required for the distribution of the Offered
Securities; provided that in no event shall the Company be obligated to
qualify to do business in any jurisdiction where it is not now so
qualified, to take any action that would subject it to service of
process in suits, other than those arising out of the offering or sale
of the Offered Securities, in any jurisdiction where it is not now
subject or to subject itself to taxation as doing business in any such
jurisdiction.
(g) Expenses. The Company will pay all expenses incident to the
performance of its obligations under the Terms Agreement (including the
provisions of this Agreement), for any filing fees or other expenses
(including reasonable fees and disbursements of counsel) in connection
with qualification of the Registered Securities for sale and
determination of their eligibility for investment under the laws of
such jurisdictions in the United States as the Lead Underwriter may
reasonably designate and the printing of memoranda relating thereto,
for any fees charged by investment rating agencies for the rating of
the Offered Securities, for any applicable filing fee incident to the
review by the National Association of Securities Dealers, Inc. of the
Registered Securities, for any travel expenses of the Company's
officers and employees and any other expenses of the Company in
connection with attending or hosting meetings with prospective
purchasers of Registered Securities and for expenses incurred in
distributing the Prospectus, any preliminary prospectus supplements or
any other amendments or supplements to the Prospectus to the
Underwriters.
(h) Taxes. The Company will indemnify and hold harmless the
Underwriters against any documentary, stamp or similar issue tax, under
the laws of Canada, including any interest and penalties payable
thereon, payable by the Underwriters on the creation, issue and sale of
the Offered Securities to the Underwriters as contemplated hereby and
on the execution and delivery of the Terms Agreement. All payments to
be made by the Company to the Underwriters hereunder shall be made
without withholding or deduction for or on account of any present or
future taxes under the Income Tax Act (Canada) (the "ITA"), unless the
Company is compelled by law to deduct or withhold such taxes, duties or
charges. In the event and to the extent the Underwriters cannot claim
or otherwise take advantage of a tax credit, refund or exemption for
Canadian tax withheld, the Company shall pay such additional amounts as
may be necessary in order that the net amounts received by the
Underwriters after such withholding or deduction shall equal the
amounts that would have been received if no withholding or deduction
had been made.
(i) Lock-up. The Company will not offer, sell, contract to sell,
pledge or otherwise dispose of, directly or indirectly, or file with
the Commission a registration statement under the Securities Act
relating to United States dollar-denominated debt securities issued or
guaranteed by the Company and having a maturity of more than one year
from the date of issue, or publicly disclose the intention to make any
such offer, sale, pledge, disposition or filing, without the prior
written consent of the Lead Underwriter for a period beginning at the
time of execution of the Terms Agreement and ending on the Closing
Date.
(j) Use of Proceeds. The Company expects to apply the net proceeds
from the sale of the Offered Securities substantially in accordance
with the description set forth in the Prospectus.
5. Conditions of the Obligations of the Underwriters. The obligations
of the several Underwriters to purchase and pay for the Offered Securities will
be subject to the accuracy of the representations and warranties on the part of
the Company herein, to the accuracy of the statements of the Company's officers
made pursuant to the provisions hereof, to the performance by the Company of its
obligations hereunder and to the following additional conditions precedent:
(a) Auditors' Comfort Letter. On or prior to the date of the Terms
Agreement, the Representatives shall have received a letter, dated the
date of delivery thereof, of Deloitte & Touche LLP confirming that they
are independent public accountants within the meaning of the Securities
Act and the applicable published Rules and Regulations thereunder and
stating to the effect that:
(i) in their opinion the financial statements and any
schedules and any summary of earnings examined by them and included
in the Prospectus comply as to form in all material respects with
the applicable accounting requirements of the Securities Act and
the related published Rules and Regulations;
(ii) they have performed the procedures specified by the
American Institute of Certified Public Accountants for a review of
interim financial information as described in Statement of Auditing
Standards No. 71, Interim Financial Information, on any unaudited
financial statements included in the Registration Statement;
(iii) on the basis of the review referred to in clause (ii)
above, a reading of the latest available interim financial
statements of the Company, inquiries of officials of the Company
who have responsibility for financial and accounting matters and
other specified procedures, nothing came to their attention that
caused them to believe that:
(A) the unaudited financial statements, if any, and any
summary of earnings included in the Prospectus do not comply
as to form in all material respects with the applicable
accounting requirements of the Securities Act and the related
published Rules and Regulations or any material modifications
should be made to such unaudited financial statements and
summary of earnings for them to be in conformity with
generally accepted accounting principles in Canada;
(B) if any unaudited "capsule" information is contained
in the Prospectus, the unaudited consolidated net sales,
operating income, net income and net income per share amounts
or other amounts constituting such "capsule" information and
described in such letter do not agree with the corresponding
amounts set forth in the unaudited consolidated financial
statements or were not determined on a basis substantially
consistent with that of the corresponding amounts in the
audited statements of income;
(C) at the date of the latest available balance sheet
read by such accountants, or at a subsequent specified date
not more than three business days prior to the date of the
such letter, there was any change in the capital stock or any
increase in short-term indebtedness or long-term debt of the
Company and its consolidated subsidiaries or, at the date of
the latest available balance sheet read by such accountants,
there was any decrease in consolidated net assets, as compared
with amounts shown on the latest balance sheet included in the
Prospectus; or
(D) for the period from the closing date of the latest
income statement included in the Prospectus to the closing
date of the latest available income statement read by such
accountants there were any decreases, as compared with the
corresponding period of the previous year, in consolidated net
sales, operating income or net income;
except in all cases set forth in clauses (C) and (D) above for
changes, increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter; and
(iv) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other financial
information contained in the Prospectus (in each case to the extent
that such dollar amounts, percentages and other financial
information are derived from the general accounting records of the
Company and its subsidiaries subject to the internal controls of the
Company's accounting system or are derived directly from such
records by analysis or computation) with the results obtained from
inquiries, a reading of such general accounting records and other
procedures specified in such letter and have found such dollar
amounts, percentages and other financial information to be in
agreement with such results, except as otherwise specified in such
letter.
All financial statements and schedules included in material
incorporated by reference into the Prospectus shall be deemed included
in the Prospectus for purposes of this subsection.
(b) Prospectus Filed; No Stop Order. The Prospectus shall have been
filed with the Commission in accordance with the Rules and Regulations
and Section 4() of this Agreement. No stop order suspending the
effectiveness of the Registration Statement or of any part thereof
shall have been issued and no proceedings for that purpose shall have
been instituted or, to the knowledge of the Company or any Underwriter,
shall be threatened by the Commission.
(c) No Material Adverse Change. Subsequent to the execution of the
Terms Agreement, there shall not have occurred (i) any change, or any
development or event involving a prospective change, in the condition
(financial or other), business, properties or results of operations of
the Company and its subsidiaries taken as one enterprise that, in the
judgment of a majority in interest of the Underwriters including any
Representatives, is material and adverse and makes it impractical or
inadvisable to proceed with completion of the public offering or the
sale of and payment for the Offered Securities; (ii) any downgrading in
the rating of any debt securities of the Company by any "nationally
recognized statistical rating organization" (as defined for purposes of
Rule 436(g) under the Securities Act), or any public announcement that
any such organization has under surveillance or review its rating of
any debt securities of the Company (other than an announcement with
positive implications of a possible upgrading, and no implication of a
possible downgrading, of such rating); (iii) any material suspension or
material limitation of trading in securities generally on the New York
Stock Exchange or The Toronto Stock Exchange or any setting of minimum
prices for trading on such exchanges, or any suspension of trading of
any securities of the Company on the New York Stock Exchange or The
Toronto Stock Exchange; (iv) any banking moratorium declared by U.S.
Federal, New York, Canadian Federal or Saskatchewan authorities; or (v)
any outbreak or escalation of major hostilities in which the United
States or Canada is involved, any declaration of war by Congress or the
Government of Canada or any other substantial national or international
calamity or emergency if, in the judgment of a majority in interest of
the Underwriters including any Representatives, the effect of any such
outbreak, escalation, declaration, calamity or emergency makes it
impractical or inadvisable to proceed with completion of the public
offering or the sale of and payment for the Offered Securities.
(d) Opinion of Canadian Counsel to the Company. The Representatives
shall have received an opinion, dated the Closing Date, of Xxxxxxxxx
Xxxxxxxxx, Canadian counsel to the Company, to the effect that:
(i) The Company is a corporation incorporated and existing
under the laws of the Province of Saskatchewan with full corporate
power and authority to own, lease and operate its properties and
assets and to conduct its business as described in the Registration
Statement and the Prospectus, and is registered to carry on business
under the laws of Saskatchewan and New Brunswick, being the only
Canadian jurisdictions where the Company carries on any material
portion of its business;
(ii) The Company has the corporate power and authority to
enter into the Terms Agreement with respect to the Offered
Securities and to issue, sell and deliver the Offered Securities to
the Underwriters as provided therein, and such Terms Agreement has
been duly authorized and, to the extent that execution and delivery
are matters governed by the laws of the Province of Saskatchewan,
has been duly executed and delivered by the Company.
(iii) The Indenture has been duly authorized and, to the
extent that execution and delivery are matters governed by the laws
of the Province of Saskatchewan, has been duly executed and
delivered by the Company.
(iv) The Offered Securities have been duly authorized and, to
the extent that execution and delivery are matters governed by the
laws of the Province of Saskatchewan, have been duly executed and
delivered by the Company.
(v) To the knowledge of such counsel, the Company is not (A)
in violation of its articles of incorporation or in material
violation of its by-laws or (B) in default in the performance of any
material obligation, agreement or condition contained in any bond,
debenture, note or other evidence of indebtedness, except as may be
disclosed in the Prospectus or where any such default or defaults,
in the aggregate, would not have a Material Adverse Effect.
(vi) Neither the issuance, sale or delivery of the Offered
Securities, nor the execution, delivery or performance of the
Indenture or the Terms Agreement with respect to any Offered
Securities, or compliance by the Company with all provisions of the
Indenture, the Offered Securities and such Terms Agreement, nor
consummation by the Company of the transactions contemplated by the
Indenture, the Offered Securities and such Terms Agreement conflicts
or will conflict with or constitutes or will constitute a breach of,
or a default under, the articles or bylaws of the Company or any
material agreement, indenture, lease or other instrument to which
the Company is a party or by which it or any of its properties is
bound that is known to such counsel, which conflict, breach or
default would have a Material Adverse Effect, or will result in the
creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company under any such agreement,
indenture, lease or other instrument, nor will any such action
result in any violation of the laws of the Province of Saskatchewan
and the laws of Canada applicable therein (assuming compliance with
all applicable securities and Blue Sky laws) or any judgment,
injunction, order or decree known to such counsel, and applicable to
the Company or any of its properties, which violation would have a
Material Adverse Effect.
(vii) No consent, approval, authorization or other order, or
registration or filing with, any court, regulatory body,
administrative agency or other governmental body, agency, or
official in the Province of Saskatchewan is required on the part of
the Company for the valid issuance and sale of the Offered
Securities to the Underwriters as contemplated by the Terms
Agreement with respect to any Offered Securities.
(viii) The choice of law of the State of New York as the
governing law of this Agreement and the Terms Agreement with respect
to the Offered Securities will be upheld as a valid choice of law by
a court of competent jurisdiction in the Province of Saskatchewan (a
"Canadian Court"), provided that such choice of law is a valid
choice under the laws of the State of New York and is made bona fide
(in the sense that it was not made with a view to avoiding the
consequences of the law of any other jurisdiction) and provided that
such choice of law is not contrary to public policy as that term is
understood under the laws of the Province of Saskatchewan. Such
counsel shall state that based solely upon a review of the terms of
this Agreement and such Terms Agreement, it is aware of no public
policy grounds that would be contravened by the choice of New York
law to generally govern this Agreement and such Terms Agreement.
(ix) Subject to the qualifications set forth in paragraph
(viii) and paragraph (xi), if an action were brought to enforce this
Agreement and the Terms Agreement with respect to the Offered
Securities in a Canadian Court, the court would apply the laws of
the State of New York as the law governing this Agreement and such
Terms Agreement upon appropriate evidence of such laws being
adduced, provided that: (A) the laws of the Province of Saskatchewan
respecting procedural matters shall govern the action; (B) the
application of the substantive laws of the State of New York is not
contrary to public policy as that term is understood under the laws
of the Province of Saskatchewan; (C) none of the terms of this
Agreement and such Terms Agreement are contrary to public policy as
that term is understood under the laws of the Province of
Saskatchewan, (D) performance of any obligation sought to be
enforced is not illegal by the law of the place of performance; (E)
there are no Saskatchewan or federal laws of mandatory application
that may affect the enforceability of agreements governed by foreign
laws; (F) the Canadian Court does not conclude that Saskatchewan is
an inconvenient forum to hear such an action and, concurrent
proceedings are not brought elsewhere; (G) due service of process
has been made upon the defendant in accordance with the laws of the
Province of Saskatchewan; and (H) the action is brought within the
limitation period then applicable in the Province of Saskatchewan.
Such counsel shall state that based solely upon a review of the
terms of this Agreement and such Terms Agreement, it is aware of no
public policy grounds that would be contravened by the enforcement
of any of the terms of this Agreement and such Terms Agreement.
(x) Although this Agreement and the Terms Agreement with
respect to the Offered Securities is expressed to be governed by and
construed in accordance with the laws of the State of New York, in
the event that in any action in a Canadian Court to enforce this
Agreement and such Terms Agreement either (A) the court were to
disregard the choice of New York law, or (B) New York law was not
proven to the court, and, in each case, the laws of the Province of
Saskatchewan were applied to govern the legality, validity and
interpretation of this Agreement and such Terms Agreement, subject
to the qualifications set forth in paragraph (xii) and the
qualification that, with respect to Section 6(a) and Section 10 of
this Agreement, there may be restrictions imposed by the common law
upon persons who are not a party to an agreement regarding their
ability to enforce provisions in such agreement for their benefit,
this Agreement and such Terms Agreement would constitute a legal,
valid and binding obligation of the Company, enforceable against it
in accordance with its terms.
(xi) Subject to the qualifications set forth in paragraph
(xii), if an action is brought in a Canadian Court upon a final and
conclusive judgment in personam of a New York court respecting the
enforcement of this Agreement and the Terms Agreement with respect
to the Offered Securities that is not void or voidable under New
York law, the New York judgment shall be treated as conclusive as to
any matter adjudicated upon and shall not be impeached for any error
of fact or law, provided that: (A) the New York court had
jurisdiction over the judgment debtor as recognized by the Canadian
Court (submission by the Company to the non-exclusive jurisdiction
of a New York court being sufficient); (B) the Canadian Court does
not conclude that the defendant, being the defendant in the original
action was not duly served with the process of the New York court
and did not appear, notwithstanding that it was carrying on business
or was ordinarily resident in New York and notwithstanding that it
agreed to submit to the jurisdiction of that court; (C) such
judgment was not obtained by fraud; (D) such judgment is for a sum
certain in money; (E) such judgment is not directly or indirectly
for the payment of a penalty or a sum of money due under the revenue
laws of New York or the United States of America; (F) such judgment
has not been satisfied or for any other reason is not a subsisting
judgment; (G) such judgment is not in respect of a cause of action
that, for reasons of public policy or for some similar reason would
not have been entertained by the Canadian Court; (H) such judgment
was not obtained in proceedings that were contrary to the principles
of natural justice; (I) there are no Saskatchewan or federal laws of
mandatory application which would affect the enforceability of the
judgment; and (x) the action to enforce such judgment is brought
within the limitation period then applicable in the Province of
Saskatchewan. Such counsel shall state that based solely upon this
Agreement and such Terms Agreement, it is aware of no public policy
grounds that would be contravened by the enforcement of judgments of
a New York court under this Agreement and such Terms Agreement.
(xii) In any action brought in a Canadian Court, the
enforceability of this Agreement, the Terms Agreement with respect
to the Offered Securities or a New York judgment may be limited or
precluded by: (A) bankruptcy, insolvency, reorganization, moratorium
or similar laws now or hereafter in effect affecting creditors
rights generally; (B) any order made by the Attorney General of
Canada under the Foreign Extraterritorial Measures Act (Canada); (C)
any order made by the Competition Tribunal under the Competition Act
(Canada); (D) general principles of equity, regardless of whether
enforceability is considered in a proceeding at law or in equity;
(E) the limitation that, under the Currency Act (Canada), a Canadian
Court may only give judgment in Canadian dollars; and (F) applicable
law in, or public policy as that term is understood in, the Province
of Saskatchewan pertaining to any rights of indemnity or
contribution contained in this Agreement and such Terms Agreement.
(xiii) To the knowledge of such counsel, other than as
described or contemplated in the Prospectus, there are no legal or
governmental proceedings in the provinces of Saskatchewan and New
Brunswick pending or threatened against the Company which would have
a Material Adverse Effect, or to which the Company, or any of its
properties is subject which would have a Material Adverse Effect.
In rendering their opinion as aforesaid, such counsel may, as to
factual and accounting matters, rely upon written certificates or
statements of officers of the Company, public and stock exchange
officials, or the auditors or transfer agents of the Company, and as to
matters of law, may rely upon an opinion or opinions, each dated the
Closing Date, of other counsel retained by them or the Company as to
laws of any jurisdiction other than the Province of Saskatchewan and
the laws of Canada applicable therein, provided that such reliance is
expressly authorized by each opinion so relied upon and a copy of each
such opinion is delivered to the Representatives and is in form and
substance reasonably satisfactory to the Representatives and their
counsel.
(e) Opinion of Canadian Tax Counsel to the Company. The
Representatives shall have received an opinion, dated the Closing Date,
of Davies Xxxx Xxxxxxxx & Xxxxxxxx LLP, Canadian tax counsel to the
Company, to the effect that, subject to the assumptions, limitations,
qualifications and conditions set out therein, the statements made in
the Prospectus relating to Canadian federal income tax laws under the
heading "Canadian Federal Income Tax Considerations" in the prospectus
supplement, insofar as they relate to matters of Canadian federal
income tax law, constitute a fair summary of the matters so discussed
and applicable to the holders of Offered Securities described therein.
(f) Opinion and Letter of United States Counsel to the Company. The
Representatives shall have received an opinion, dated the Closing Date,
of Cleary, Gottlieb, Xxxxx & Xxxxxxxx, special United States counsel to
the Company, to the effect that:
(i) Each of the Subsidiaries is validly existing as a
corporation or limited partnership in good standing under the laws
of the State of Delaware.
(ii) The Terms Agreement has been duly executed and delivered
by the Company under the law of the State of New York.
(iii) The Indenture has been duly executed and delivered by
the Company under the law of the State of New York and qualified
under the Trust Indenture Act, and is a valid, binding and
enforceable agreement of the Company.
(iv) Upon their execution by the Company in accordance with
the Indenture and delivery in accordance with the Terms Agreement,
the Offered Securities will be the valid, binding and enforceable
obligations of the Company.
(v) The issuance and sale of the Offered Securities to the
Underwriters pursuant to the Terms Agreement and the performance by
the Company of its obligations in the Terms Agreement, the Indenture
and the Offered Securities (A) do not require any consent, approval,
authorization, registration or qualification of or with any
governmental authority of the United States or the State of New
York, except such as has been obtained or effected under the
Securities Act and the Trust Indenture Act (but no opinion need be
expressed as to any consent, approval, authorization, registration
or qualification that may be required under any state securities or
Blue Sky laws), (B) do not result in a violation of any United
States federal law or New York State law known to such counsel and
applicable to the Company with respect to the issuance and sale of
the Offered Securities (but no opinion need be expressed as to any
United States federal securities or New York State securities or
Blue Sky laws) and (C) based solely on inquiry of the General
Counsel of the Company, do not result in a breach or violation of
any judgment, decree or order applicable to the Company of any New
York State or Federal court or other New York State or Federal
governmental authority.
(vi) The statements set forth under the headings "Description
of the Notes" and "Description of Securities" in the Prospectus,
insofar as such statements purport to summarize certain provisions
of the Offered Securities and the Indenture, provide a fair summary
of such provisions.
(vii) Under the laws of the State of New York relating to
submission to jurisdiction, the Company has (A) pursuant to Section
14 of the Underwriting Agreement, validly and irrevocably submitted
to the personal jurisdiction of any United States federal or state
court located in the Borough of Manhattan in The City of New York in
any action arising out of or related to the Terms Agreement, (B)
pursuant to Section 114 of the Indenture, validly and irrevocably
submitted to the personal jurisdiction of any United Sates federal
or state court located in The City of New York in any action or
proceeding arising out of or relating to the Notes or the Indenture,
and (C) validly appointed CT Corporation System as its initial
authorized agent for the purposes described in Section 14 of the
Underwriting Agreement and Section 114 of the Indenture,
respectively; and service of process effected in the manner set
forth in Section 14 of the Underwriting Agreement and Section 114 of
the Indenture will be effective to confer valid personal
jurisdiction over the Company in the actions or proceedings
described in such provisions.
(viii) The Company is not and, after giving effect to the
offering and sale of the Notes, will not be an "investment company"
within the meaning of the Investment Company Act of 1940.
In addition, the Representatives shall have received a letter,
dated the Closing Date, of Cleary, Gottlieb, Xxxxx & Xxxxxxxx, special
United States counsel to the Company, to the effect that, based on such
counsel's participation in certain conferences and telephone
conversations in connection with the preparation of the Prospectus and
certain documents incorporated by reference therein, such counsel's
review of certain corporate records and documents of the Company and
such counsel's understanding of the U.S. federal securities laws and
the experience they have gained in their practice thereunder:
(i) The Registration Statement (except the financial
statements and schedules and other financial data included therein
and the documents incorporated therein by reference), at the time it
became effective, and the Prospectus (except as aforesaid), as of
the date thereof, appeared on their face to be appropriately
responsive in all material respects to the requirements of the
Securities Act and the Trust Indenture Act and the rules and
regulations thereunder (other than Regulation S-T under the
Securities Act). In addition, such counsel does not know of any
contracts or other documents of a character required to be filed as
exhibits to the Registration Statement (excluding the documents
incorporated therein by reference) or required to be described in
the Registration Statement or the Prospectus (in each case,
excluding the documents incorporated therein by reference) that are
not filed or described as required.
(ii) The documents incorporated by reference in the
Registration Statement and the Prospectus (except the financial
statements and schedules and other financial data included therein),
as of the respective dates of their filing with the Commission,
appeared on their face to be appropriately responsive in all
material respects to the requirements of the Exchange Act and the
rules and regulations thereunder.
(iii) No information has come to the attention of such counsel
that causes them to believe that the Registration Statement,
including the documents incorporated by reference therein (except
the financial statements and schedules and other financial data
included therein), at the time it became effective, contained an
untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading.
(iv) No information has come to the attention of such counsel
that causes them to believe that the Prospectus, including the
documents incorporated by reference therein (except the financial
statements and schedules and other financial data included therein),
as of the date thereof or the Closing Date, contained or contains an
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.
(v) Such counsel has confirmed that (based solely upon a
telephonic confirmation from a representative of the Commission) the
Registration Statement is effective under the Securities Act and, to
the best of such counsel's knowledge, no stop order with respect
thereto has been issued, and no proceeding for that purpose has been
instituted or threatened, by the Commission.
(vi) Such counsel has confirmed that, based solely on inquiry
of the General Counsel of the Company and of lawyers currently with
such firm who have been actively involved in the Company's
preparation of the prospectus supplement and the documents
incorporated by reference therein, such counsel knows of no legal or
governmental proceedings to which the Company or any of the
Subsidiaries is a party that are currently pending before any
adjudicative tribunal or that have been threatened by a written
communication manifesting an intention to initiate such proceedings
received by the General Counsel of the Company or by such counsel
that are required to be disclosed in the prospectus supplement or
the documents incorporated by reference therein that are not
disclosed in the prospectus supplement or the documents incorporated
by reference therein.
In rendering such opinion and letter as aforesaid, such counsel may,
as to factual and accounting matters, rely upon written certificates or
statements of officers of the Company, public and stock exchange
officials, or the auditors or transfer agents of the Company, and as to
matters of law, may rely upon an opinion or opinions, each dated the
Closing Date, of other counsel retained by them or the Company as to
laws of any jurisdiction other than the federal law of the United
States, the law of the State of New York and the General Corporation
Law of the State of Delaware, provided that such reliance is expressly
authorized by each opinion so relied upon and a copy of each such
opinion is delivered to the Representatives and is in form and
substance reasonably satisfactory to the Representatives and their
counsel. In addition, such counsel may state that (x) such opinion is
limited to the federal law of the United States, the law of the State
of New York and the General Corporation Law of the State of Delaware,
(y) they have assumed, among other things, the accuracy as to factual
matters of each document they have reviewed and that the Offered
Securities conform to the form thereof they have reviewed and will be
duly authenticated in accordance with the terms of the Indenture; and
(z) insofar as such opinion relates to the validity, binding effect or
enforceability of any agreement or obligation of the Company (1) such
counsel has assumed that the Company and each other party to such
agreement or obligation has satisfied those legal requirements that are
applicable to it to the extent necessary to make such agreement or
obligation enforceable against it (except that no such assumption shall
be made as to the Company regarding matters of the federal law of the
United States or the law of the State of New York), and (2) such
opinion is subject to applicable bankruptcy, insolvency and similar
laws affecting creditors' rights generally and to general principles of
equity and to the effect of judicial application of foreign laws or
foreign governmental actions affecting creditors' rights. With respect
to the opinions expressed in paragraph (vii) above, such counsel may
(A) state that they express no opinion as to the subject matter
jurisdiction of any United States federal court to adjudicate any
action relating to the Terms Agreement, the Notes or the Indenture
where jurisdiction based on diversity of citizenship under 28 U.S.C.
ss. 1332 does not exist, and (B) note that the designations in Section
14 of the Underwriting Agreement and Section 114 of the Indenture of
the United States federal courts located in The City of New York as the
venue for actions or proceedings relating to the Terms Agreement and
the Notes and the Indenture, respectively, is subject to the power of
such courts to transfer such actions or proceedings pursuant to 28
U.S.C. ss. 1404(a) or to dismiss such actions or proceedings on the
grounds that such a federal court is an inconvenient forum for such
actions or proceedings.
(g) Opinion of United States Tax Advisor to the Company. The
Representatives shall have received an opinion, dated the Closing Date,
of Xxxxxxxx LLP, special United States tax advisor to the Company, to
the effect that, subject to the assumptions, limitations,
qualifications and conditions set out therein, the statements made in
the Prospectus under the heading "United States Federal Income Tax
Considerations" in the prospectus supplement, insofar as such
statements purport to summarize certain federal income tax laws of the
United States, constitute a fair summary of the principal U.S. federal
income tax consequences of an investment in the Offered Securities.
(h) Opinion of Counsel to the Underwriters. The Representatives
shall have received from Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP,
counsel for the Underwriters, such opinion or opinions, dated the
Closing Date, with respect to such matters as the Representatives may
require, and the Company shall have furnished to such counsel such
documents as they request for the purpose of enabling them to pass upon
such matters.
(i) Officer's Certificate. The Representatives shall have received a
certificate, dated the Closing Date, of the President or any Vice
President and a principal financial or accounting officer of the
Company in which such officers, to the best of their knowledge after
reasonable investigation, shall state on behalf of the Company that the
representations and warranties of the Company in this Agreement are
true and correct, that the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied
hereunder at or prior to the Closing Date, that no stop order
suspending the effectiveness of the Registration Statement or of any
part thereof has been issued and no proceedings for that purpose have
been instituted or, to their knowledge, are threatened by the
Commission and that, subsequent to the date of the most recent
financial statements in the Prospectus, there has been no material
adverse change, nor any development or event involving a prospective
material adverse change, in the condition (financial or other),
business, properties or results of operations of the Company and its
subsidiaries taken as one enterprise, except as set forth in or
contemplated by the Prospectus or as described in such certificate.
(j) Bring-down Auditors' Comfort Letter. The Representatives shall
have received a letter, dated the Closing Date, of Deloitte & Touche
LLP which meets the requirements of subsection (a) of this Section,
except that the specified date referred to in such subsection will be a
date not more than three days prior to the Closing Date for the
purposes of this subsection.
The Company will furnish the Representatives with such conformed copies of such
opinions, certificates, letters and documents as the Representatives reasonably
request. The Lead Underwriter may in its sole discretion waive on behalf of the
Underwriters compliance with any conditions to the obligations of the
Underwriters under this Agreement and the Terms Agreement.
6. Indemnification and Contribution. (a) Indemnification of the
Underwriters by the Company. The Company will indemnify and hold harmless each
Underwriter, its partners, directors and officers and each person, if any, who
controls such Underwriter within the meaning of Section 15 of the Securities
Act, against any losses, claims, damages or liabilities, joint or several, to
which such Underwriter, partner, director, officer or controlling person may
become subject, under the Securities Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of any material
fact contained in the Registration Statement, the Prospectus, or any amendment
or supplement thereto, or any related preliminary prospectus or preliminary
prospectus supplement, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and will reimburse each
Underwriter, partner, director, officer or controlling person for any legal or
other expenses reasonably incurred by such person in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that the Company will not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement in or omission or alleged omission from any of such documents in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter through the Representatives, if any, specifically for
use therein, it being understood and agreed that the only such information
furnished by any Underwriter consists of the information described as such in
the Terms Agreement; and provided further that with respect to any untrue
statement or alleged untrue statement in or omission or alleged omission from
any preliminary prospectus or preliminary prospectus supplement, the indemnity
agreement contained in this subsection (a) shall not inure to the benefit of any
Underwriter (or its partners, directors, officers and controlling persons) from
whom the person asserting any such losses, claims, damages or liabilities
purchased the Offered Securities concerned, to the extent that a prospectus
relating to such Offered Securities was required to be delivered by such
Underwriter under the Securities Act in connection with such purchase and any
such loss, claim, damage or liability of such Underwriter (or its partners,
directors, officers and controlling persons) results from the fact that there
was not sent or given to such person, at or prior to the written confirmation of
the sale of such Offered Securities to such person, a copy of the Prospectus
(exclusive of material incorporated by reference) if the Company had previously
furnished copies thereof to such Underwriter.
(b) Indemnification of the Company by the Underwriters. Each
Underwriter will severally and not jointly indemnify and hold harmless the
Company, its directors and officers and each person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act, against any
losses, claims, damages or liabilities to which the Company may become subject,
under the Securities Act or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact contained
in the Registration Statement, the Prospectus, or any amendment or supplement
thereto, or any related preliminary prospectus or preliminary prospectus
supplement, or arise out of or are based upon the omission or the alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by such Underwriter
through the Representatives, if any, specifically for use therein, and will
reimburse any legal or other expenses reasonably incurred by the Company in
connection with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred, it being understood and
agreed that the only such information furnished by any Underwriter consists of
the information described as such in the Terms Agreement.
(c) Actions Against Parties; Notification. Promptly after receipt by an
indemnified party under this Section of notice of the commencement of any
action, such indemnified party will, if a claim in respect thereof is to be made
against the indemnifying party under subsection (a) or (b) above, notify the
indemnifying party of the commencement thereof; but the omission so to notify
the indemnifying party will not relieve it from any liability that it may have
to any indemnified party otherwise than under subsection (a) or (b) above. In
case any such action is brought against any indemnified party and it notifies
the indemnifying party of the commencement thereof, the indemnifying party will
be entitled to participate therein and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party), and after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party will
not be liable to such indemnified party under this Section for any legal or
other expenses subsequently incurred by such indemnified party in connection
with the defense thereof other than reasonable costs of investigation. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened action in respect of
which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party unless such settlement (i)
includes an unconditional release of such indemnified party from all liability
on any claims that are the subject matter of such action and (ii) does not
include a statement as to, or an admission of, fault, culpability or a failure
to act by or behalf of an indemnified party. It is understood that the
indemnifying party shall, in connection with any one action, suit or proceeding
or separate but substantially similar or related actions, suits or proceedings
in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of only one
separate firm of attorneys (in addition to any local counsel) at any time for
all such indemnified parties not having actual or potential differing interests.
The indemnifying party shall not be liable for any settlement of any such
action, suit or proceeding effected without its written consent, which consent
shall not be unreasonably withheld.
(d) Contribution. If the indemnification provided for in this Section
is unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b) above (i) in
such proportion as is appropriate to reflect the relative benefits received by
the Company on the one hand and the Underwriters on the other from the offering
of the 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 on the one hand and the Underwriters on the
other 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 the Underwriters on the other shall be deemed to be in the same proportion
as the total net proceeds from the offering (before deducting expenses) received
by the Company bear to the total underwriting discounts and commissions received
by the Underwriters. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company or the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission. The amount paid by an indemnified
party as a result of the losses, claims, damages or liabilities referred to in
the first sentence of this subsection (d) shall be deemed to include any legal
or other expenses reasonably incurred by such indemnified party in connection
with investigating or defending any action or claim that is the subject of this
subsection (d). Notwithstanding the provisions of this subsection (d), no
Underwriter shall 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 which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Underwriters'
obligations in this subsection (d) to contribute are several in proportion to
their respective underwriting obligations and not joint.
(e) Obligations in Addition to Other Liabilities. The obligations of
the Company under this Section shall be in addition to any liability which the
Company may otherwise have and shall extend, upon the same terms and conditions,
to each person, if any, who controls any Underwriter within the meaning of the
Securities Act; and the obligations of the Underwriters under this Section shall
be in addition to any liability that the respective Underwriters may otherwise
have and shall extend, upon the same terms and conditions, to each director of
the Company, to each officer of the Company who has signed the Registration
Statement and to each person, if any, who controls the Company within the
meaning of the Securities Act.
7. Default of Underwriters. If any Underwriter or Underwriters default
in their obligations to purchase Offered Securities under the Terms Agreement
and the aggregate principal amount of Offered Securities that such defaulting
Underwriter or Underwriters agreed but failed to purchase does not exceed 10% of
the total principal amount of Offered Securities, the Lead Underwriter may make
arrangements satisfactory to the Company for the purchase of such Offered
Securities by other persons, including any of the Underwriters, but if no such
arrangements are made by the Closing Date, the non-defaulting Underwriters shall
be obligated severally, in proportion to their respective commitments under the
Terms Agreement (including the provisions of this Agreement), to purchase the
Offered Securities that such defaulting Underwriters agreed but failed to
purchase. If any Underwriter or Underwriters so default and the aggregate
principal amount of Offered Securities with respect to which such default or
defaults occur exceeds 10% of the total principal amount of Offered Securities
and arrangements satisfactory to the Lead Underwriter and the Company for the
purchase of such Offered Securities by other persons are not made within 36
hours after such default, the Terms Agreement will terminate without liability
on the part of any non-defaulting Underwriter or the Company, except as provided
in Section 8. As used in this Agreement, the term "Underwriter" includes any
person substituted for an Underwriter under this Section. Nothing herein will
relieve a defaulting Underwriter from liability for its default. The respective
commitments of the several Underwriters for the purposes of this Section shall
be determined without regard to reduction in the respective Underwriters'
obligations to purchase the principal amounts of the Offered Securities set
forth opposite their names in the Terms Agreement as a result of Delayed
Delivery Contracts entered into by the Company.
8. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Company or its officers and of the several Underwriters set forth in or made
pursuant to the Terms Agreement (including the provisions of this Agreement)
will remain in full force and effect, regardless of any investigation, or
statement as to the results thereof, made by or on behalf of any Underwriter,
the Company or any of their respective representatives, officers or directors or
any controlling person, and will survive delivery of and payment for the Offered
Securities. If the Terms Agreement is terminated pursuant to Section 7 or if for
any reason the purchase of the Offered Securities by the Underwriters is not
consummated, the Company shall remain responsible for the expenses to be paid or
reimbursed by it pursuant to Section 4 and the respective obligations of the
Company and the Underwriters pursuant to Section 6 shall remain in effect. If
the purchase of the Offered Securities by the Underwriters is not consummated
for any reason other than because of the termination of the Terms Agreement
pursuant to Section 7 or the occurrence of any event specified in clause (iii),
(iv) or (v) of Section 5(c), the Company will reimburse the Underwriters for all
out-of-pocket expenses (including fees and disbursements of counsel) reasonably
incurred by them in connection with the offering of the Offered Securities.
9. Notices. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed, delivered or telegraphed and confirmed
to them at their address furnished to the Company in writing for the purpose of
communications hereunder or, if sent to the Company, will be mailed, delivered
or telegraphed and confirmed to it at 000 - 0xx Xxxxxx Xxxxx, Xxxxx 000,
Xxxxxxxxx, Xxxxxxxxxxxx, Xxxxxx X0X 0X0, Tel.: (000) 000-0000, Fax: (306)
000-0000, Attention: Chief Financial Officer.
10. Successors. The Terms Agreement (including the provisions of this
Agreement) will inure to the benefit of and be binding upon the Company and such
Underwriters as are identified in the Terms Agreement and their respective
successors and the officers and directors and controlling persons referred to in
Section 6, and no other person will have any right or obligation hereunder.
11. Representation of Underwriters. Any Representatives will act for
the several Underwriters in connection with the financing described in the Terms
Agreement, and any action under such Terms Agreement (including the provisions
of this Agreement) taken by the Representatives jointly or by the Lead
Underwriter will be binding upon all the Underwriters.
12. Counterparts. The Terms Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
13. Applicable Law. This Agreement and the Terms Agreement shall be
governed by, and construed in accordance with, the laws of the State of New
York, without regard to the principles of conflicts of laws.
14. Submission to Jurisdiction. The Company hereby submits to the
non-exclusive jurisdiction of the United States federal and state courts in the
Borough of Manhattan in The City of New York in any suit or proceeding arising
out of the Terms Agreement (including the provisions of this Agreement) or the
transactions contemplated thereby. The Company irrevocably appoints CT
Corporation System, 000 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, as its
authorized agent in the Borough of Manhattan in the City of New York upon which
process may be served in any such suit or proceeding, and agrees that service of
process upon such agent, and written notice of said service to the Company by
the person serving the same to the address provided in Section 9, shall be
deemed in every respect effective service of process upon the Company in any
such suit or proceeding. The Company further agrees to take any and all action
as may be necessary to maintain such designation and appointment of such agent
in full force and effect for a period of six years from the date of the Terms
Agreement.
15. Judgement Currency. The obligation of the Company in respect of any
sum due to any Underwriter shall, notwithstanding any judgment in a currency
other than United States dollars, not be discharged until the first business
day, following receipt by such Underwriter of any sum adjudged to be so due in
such other currency, on which (and only to the extent that) such Underwriter may
in accordance with normal banking procedures purchase United States dollars with
such other currency; if the United States dollars so purchased are less than the
sum originally due to such Underwriter thereunder, the Company agrees, as a
separate and independent obligation and notwithstanding any such judgment, to
indemnify such Underwriter against such loss. If the United States dollars so
purchased are greater than the sum originally due to such Underwriter
thereunder, such Underwriter agrees to pay promptly to the Company an amount
equal to the excess of the dollars so purchased over the sum originally due to
such Underwriter thereunder.
SCHEDULE A
Subsidiaries
PCS Phosphate Company, Inc. (Delaware)
PCS Nitrogen, Inc. (Delaware)
PCS Sales (USA), Inc. (Delaware)
PCS Nitrogen Fertilizer, L.P. (Delaware)
ANNEX I
DELAYED DELIVERY CONTRACT
-------------------------
_____________ , 2001
POTASH CORPORATION OF SASKATCHEWAN INC.
Ladies and Gentlemen:
The undersigned hereby agrees to purchase from Potash Corporation of
Saskatchewan Inc., a company incorporated under the laws of the Province of
Saskatchewan, Canada (the "Company"), and the Company agrees to sell to the
undersigned, as of the date hereof, for delivery on ______, 2001 (the "Delivery
Date"),
$.............
principal amount of the Company's ___% Notes due ____ (the "Securities"),
offered by the Company's Prospectus dated May 30, 1997 and a Prospectus
Supplement dated May __, 2001 relating thereto, receipt of copies of which is
hereby acknowledged, at __% of the principal amount thereof plus accrued
interest, if any, and on the further terms and conditions set forth in this
Delayed Delivery Contract (this "Contract").
Payment for the Securities that the undersigned has agreed to purchase
for delivery on the Delivery Date shall be made to the Company or its order in
Federal (same day) funds by certified or official bank check or wire transfer
(as specified by the Company) to an account designated by the Company, at the
office of ________at____A.M. on the Delivery Date upon delivery to the
undersigned of the Securities to be purchased by the undersigned in definitive
fully registered form and in such denominations and registered in such names as
the undersigned may designate by written or telegraphic communication addressed
to the Company not less than five full business days prior to the Delivery Date.
It is expressly agreed that the provisions for delayed delivery and
payment are for the sole convenience of the undersigned; that the purchase
hereunder of Securities is to be regarded in all respects as a purchase as of
the date of this Contract; that the obligation of the Company to make delivery
of and accept payment for, and the obligation of the undersigned to take
delivery of and make payment for, Securities on the Delivery Date shall be
subject only to the conditions that (1) investment in the Securities shall not
at the Delivery Date be prohibited under the laws of any jurisdiction in the
United States to which the undersigned is subject and (2) the Company shall have
sold to the Underwriters the total principal amount of the Securities less the
principal amount thereof covered by this and other similar Contracts. The
undersigned represents that its investment in the Securities is not, as of the
date hereof, prohibited under the laws of any jurisdiction to which the
undersigned is subject and which governs such investment.
Promptly after completion of the sale to the Underwriters, the Company
will mail or deliver to the undersigned at its address set forth below notice to
such effect, accompanied by copies of the opinions of counsel for the Company
delivered to the Underwriters in connection therewith.
This Contract will inure to the benefit of and be binding upon the
parties hereto and their respective successors, but will not be assignable by
either party hereto without the written consent of the other.
It is understood that the acceptance of any such Contract is in the
Company's sole discretion and, without limiting the foregoing, need not be on a
first-come, first-served basis. If this Contract is acceptable to the Company,
it is requested that the Company sign the form of acceptance below and mail or
deliver one of the counterparts hereof to the undersigned at its address set
forth below. This will become a binding contract between the Company and the
undersigned when such counterpart is so mailed or delivered.
Yours very truly,
.............................................
(Name of Purchaser)
By ..........................................
........................................
(Title of Signatory)
........................................
........................................
(Address of Purchaser)
Accepted, as of the above date.
POTASH CORPORATION OF SASKATCHEWAN INC.
By ....................................
[Insert Title]
POTASH CORPORATION OF SASKATCHEWAN INC.
Debt Securities
TERMS AGREEMENT
---------------
May 16, 2001
To: The Underwriters identified herein
Ladies and Gentlemen:
The undersigned Potash Corporation of Saskatchewan Inc. (the
"Company") agrees to sell to the several Underwriters named in Schedule A hereto
for their respective accounts, on and subject to the terms and conditions of the
Underwriting Agreement incorporated by reference to the Company's Current Report
on Form 8-K dated May 16, 2001 as an exhibit to the Company's registration
statement on Form S-3 (No. 333-27685) (the "Underwriting Agreement"), the
following securities (the "Offered Securities") on the following terms:
Title: 7 3/4% Notes due May 31, 2011.
Principal Amount: $600,000,000.
Interest: 7 3/4% per annum, from May 21, 2001, payable semiannually on
May 31 and November 30, commencing November 30, 2001, to holders of record on
the preceding May 15 or November 15, as the case may be.
Maturity: May 31, 2011.
Optional Redemption: The Offered Securities will be redeemable, in
whole or in part, at the option of the Company at any time and from time to time
at a redemption price equal to the greater of (i) 100% of the principal amount
of the Offered Securities to be redeemed and (ii) the sum of the present values
of the remaining scheduled payments discounted to the date of redemption on a
semi-annual basis (assuming a 360-day year consisting of twelve 30-day months)
at the adjusted treasury rate plus 30 basis points together with, in each case,
accrued interest on the principal amount of the Offered Securities to be
redeemed to the date of redemption, as more fully described in the Company's
Prospectus Supplement dated May 16, 2001 (the "Prospectus Supplement").
Listing: None.
Delayed Delivery Contracts: None.
Underwriting Fee: 0.650% of principal amount.
Purchase Price: 99.345% of principal amount, plus accrued interest, if
any, from May 21, 2001.
Expected Reoffering Price: 99.345% of principal amount, subject to
change by the Lead Underwriter.
Closing: 8:30 A.M. on May 21, 2001, at the offices of Skadden, Arps,
Slate, Xxxxxxx & Xxxx LLP, Four Times Square, New York, New York, in Federal
(same day) funds.
Settlement and Trading: Book-Entry only via DTC.
Lead Underwriter: Credit Suisse First Boston Corporation.
The respective principal amounts of the Offered Securities to be
purchased by each of the Underwriters are set forth opposite their names in
Schedule A hereto.
The provisions of the Underwriting Agreement are incorporated herein by
reference.
The Offered Securities will be made available for checking and
packaging at the offices of Cleary, Gottlieb, Xxxxx & Xxxxxxxx, Xxx Xxxxxxx
Xxxxx, Xxx Xxxx, Xxx Xxxx at least 24 hours prior to the Closing Date.
For purposes of Section 6 of the Underwriting Agreement, the only
information furnished to the Company by any Underwriter for use in the
Prospectus consists of:
(i) the information in the third paragraph under the caption
"Underwriting" in the prospectus supplement;
(ii) the information regarding affiliates of the Underwriters
in the eighth paragraph under the caption "Underwriting"
in the prospectus supplement;
(iii) the information in the ninth paragraph under the caption
"Underwriting" in the prospectus supplement; and
(iv) the information regarding Internet distributions in the
tenth paragraph under the caption "Underwriting" in the
prospectus supplement.
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to the Company one of the counterparts hereof,
whereupon it will become a binding agreement between the Company and the several
Underwriters in accordance with its terms.
Very truly yours,
POTASH CORPORATION OF SASKATCHEWAN INC.
By /s/ Xxxxx X. Xxxxxxxx
------------------------------------
Xxxxx X. Xxxxxxxx
Senior Vice President, Treasurer and
Chief Financial Officer
By /s/ Xxxx X.X. Xxxxxxx
------------------------------
Xxxx X.X. Xxxxxxx
Senior Vice President,
General Counsel and Secretary
The foregoing Terms Agreement is hereby confirmed
and accepted as of the date first above written.
CREDIT SUISSE FIRST BOSTON CORPORATION
Xxxxxxx Xxxxx Barney Inc.
Banc of America Securities LLC
RBC Dominion Securities Corporation
Scotia Capital (USA) Inc.
By /s/ Xxxxxx XxXxxx
-------------------------------
Credit Suisse First Boston Corporation
acting as representative of the
several Underwriters
Name: Xxxxxx XxXxxx
Title: Director
SCHEDULE A
Principal
Underwriter Amount
----------- ------
Credit Suisse First Boston Corporation........................ $300,000,000
Xxxxxxx Xxxxx Xxxxxx Inc...................................... 120,000,000
Banc of America Securities LLC................................ 60,000,000
RBC Dominion Securities Corporation........................... 60,000,000
Scotia Capital (USA) Inc...................................... 60,000,000
------------
Total............................................. $ 600,000,000
============
