EXHIBIT 1.1
PACKAGING CORPORATION OF AMERICA
Common Stock
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UNDERWRITING AGREEMENT
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Xxxxxxx, Xxxxx & Co.
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxx Xxxxx Barney Inc.
Deutsche Bank Securities Inc.
X.X. Xxxxxx Securities Inc.
As representatives of the several Underwriters
named in Schedule I hereto
c/o Goldman, Sachs & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000.
Ladies and Gentlemen:
Packaging Corporation of America, a Delaware corporation (the
"Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the Underwriters named in Schedule I hereto (the
"Underwriters") an aggregate of 11,500,000 shares of common stock, par value
$.01 per share (the "Stock"), of the Company and Pactiv Corporation, a
stockholder of the Company (the "Selling Stockholder"), proposes, subject to
the terms and conditions stated herein, to sell to the Underwriters an
aggregate of 34,750,000 shares and, at the election of the Underwriters, up
to 6,410,240 additional shares of Stock. The aggregate of 46,250,000 shares
to be sold by the Company and the Selling Stockholder is herein called the
"Firm Shares" and the aggregate of 6,410,240 additional shares to be sold by
the Selling Stockholder is herein called the "Optional Shares". The Firm
Shares and the Optional Shares that the Underwriters elect to purchase
pursuant to Section 2 hereof are herein collectively called the "Shares".
1. (a) The Company represents and warrants to, and agrees
with, each of the Underwriters that:
(i) A registration statement on Form S-1 (File No.
333-86963) as amended by any pre-effective amendments filed prior
to the execution and delivery of this Agreement by each of the
Underwriters (the "Initial Registration Statement") in respect of
the Shares has been filed with the Securities and Exchange
Commission (the "Commission"); the Initial Registration Statement
and any post-effective amend-
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ment thereto, each in the form heretofore delivered to you, and,
excluding exhibits thereto, to you for each of the other
Underwriters, have been declared effective by the Commission in such
form; other than a registration statement, if any, increasing the
size of the offering (a "Rule 462(b) Registration Statement"), filed
pursuant to Rule 462(b) under the Securities Act of 1933, as amended
(the "Act"), which became effective upon filing, no other document
with respect to the Initial Registration Statement has heretofore
been filed with the Commission; and no stop order suspending the
effectiveness of the Initial Registration Statement, any
post-effective amendment thereto or the Rule 462(b) Registration
Statement, if any, has been issued and no proceeding for that
purpose has been initiated or threatened by the Commission (any
preliminary prospectus included in the Initial Registration
Statement or filed with the Commission pursuant to Rule 424(a) of
the rules and regulations of the Commission under the Act is
hereinafter called a "Preliminary Prospectus"; the various parts of
the Initial Registration Statement and the Rule 462(b) Registration
Statement, if any, including all exhibits thereto and including the
information contained in the form of final prospectus filed with the
Commission pursuant to Rule 424(b) under the Act in accordance with
Section 5(a) hereof and deemed by virtue of Rule 430A under the Act
to be part of the Initial Registration Statement at the time it was
declared effective, as amended at the time such part of the Initial
Registration Statement became effective or such part of the Rule
462(b) Registration Statement, if any, became or hereafter becomes
effective, are hereinafter collectively called the "Registration
Statement"; and such final prospectus, in the form first filed
pursuant to Rule 424(b) under the Act, is hereinafter called the
"Prospectus");
(ii) No order preventing or suspending the use of any
Preliminary Prospectus has been issued by the Commission, and each
Preliminary Prospectus, at the time of filing thereof, conformed in all
material respects to the requirements of the Act and the rules and
regulations of the Commission thereunder, and did not contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not
misleading; PROVIDED, HOWEVER, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the Company
by an Underwriter through Xxxxxxx, Xxxxx & Co. expressly for use
therein or by the Selling Stockholder expressly for use therein;
(iii) The Registration Statement conforms, and the
Prospectus and any further amendments or supplements to the
Registration Statement or the Prospectus will conform, in all
material respects to the requirements of the Act and the rules and
regulations of the Commission thereunder and do not and will not, as
of the applicable effective date as to the Registration Statement
and any amendment thereto and as of the applicable filing date as to
the Prospectus and any amendment or supplement thereto, 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; PROVIDED, HOWEVER, that this representation
and warranty shall not apply to any statements or omissions made in
reliance upon and in conformity with information furnished in
writing to the Company by an Underwriter through Goldman,
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Sachs & Co. expressly for use therein or by the Selling Stockholder
expressly for use therein;
(iv) Neither the Company nor any of its subsidiaries has
sustained since the date of the latest audited financial statements
included in the Prospectus any material loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus; and, since the respective dates as of
which information is given in the Registration Statement and the
Prospectus, there has not been any change in the capital stock (other
than pursuant to the grant or exercise of options under plans described
in the Prospectus) or increase in the long-term debt of the Company or
any of its subsidiaries or any material adverse change, or any
development involving a prospective material adverse change, in or
affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries, taken as a whole, otherwise than as set forth or
contemplated in the Prospectus;
(v) The Company and its subsidiaries have good and
marketable title in fee simple to all real property and good and
marketable title to all personal property owned by them, in each
case free and clear of all liens, encumbrances and defects except
such as are described in the Prospectus or such as would not have a
material adverse effect on the business, senior management,
financial position, stockholders' equity or results of operations of
the Company and its subsidiaries, taken as a whole (a "Material
Adverse Effect"); and any real property and buildings held under
lease or cutting rights by the Company and its subsidiaries are held
by them under valid, subsisting and enforceable leases or other
agreements with such exceptions as would not, singly or in the
aggregate, have a Material Adverse Effect;
(vi) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
the State of Delaware, with power and authority (corporate and
other) to own its properties and conduct its business as described
in the Prospectus, and has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
properties or conducts any business, other than where the failure to
be so qualified or in good standing would not, singly or in the
aggregate, reasonably be expected to have a Material Adverse Effect;
and each subsidiary of the Company has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
its jurisdiction of incorporation, with power and authority
(corporate and other) to own its properties and conduct its business
as described in the Prospectus, and has been duly qualified as a
foreign corporation for the transaction of business and is in good
standing under the laws of each other jurisdiction in which it owns
or leases properties or conducts any business, other than where the
failure to be so qualified or in good standing would not, singly or
in the aggregate, reasonably be expected to have a Material Adverse
Effect;
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(vii) The Company has an authorized capitalization as set
forth in the Prospectus, and all of the issued shares of capital stock
of the Company have been duly authorized and are validly issued, fully
paid and non-assessable and conform to the description of the Stock
contained in the Prospectus; and all of the issued shares of capital
stock of each subsidiary of the Company have been duly authorized,
validly issued, fully paid and non-assessable and (except for
directors' qualifying shares) are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances, security interests
and claims other than liens, encumbrances, security interests and
claims created pursuant to the senior bank financing as described in
the Prospectus;
(viii) The unissued Firm Shares to be issued and sold by the
Company to the Underwriters hereunder have been duly and validly
authorized and, when issued and delivered against payment therefor as
provided herein, will be duly and validly issued and fully paid and
non-assessable and will conform to the description of the Stock
contained in the Prospectus;
(ix) This Agreement has been duly authorized, executed and
delivered by the Company. The issue and sale of the Shares to be sold
by the Company hereunder and the compliance by the Company with all of
the provisions of this Agreement and the consummation of the
transactions herein contemplated will not (a) violate the certificate
or articles of incorporation or by-laws of the Company or any of its
subsidiaries, (b) constitute a violation by the Company or any of its
subsidiaries of any applicable provision of any law, statute or
regulation, except for violations which would not, singly or in the
aggregate, have a Material Adverse Effect, or (c) breach, or result in
a default under, any agreement known to the Company's executive
officers to be material to the Company and its subsidiaries taken as a
whole, except for conflicts or breaches which would not, singly or in
the aggregate, have a Material Adverse Effect; and no consent,
approval, authorization, order, license, registration or qualification
of or with any such court or governmental agency or body is required
for the issue and sale of the Shares or the consummation by the Company
of the transactions contemplated by this Agreement, except the
registration under the Act of the Shares and such consents, approvals,
authorizations, orders, licenses, registrations or qualifications (i)
as may be required under state or foreign securities or Blue Sky laws
in connection with the purchase and distribution of the Shares by the
Underwriters, (ii) as have been obtained or (iii) the failure to obtain
of which would not, singly or in the aggregate, have a Material Adverse
Effect;
(x) Neither the Company nor any of its subsidiaries is,
or with the giving of notice or lapse of time or both would be, in
violation of or in default under, its certificate or articles of
incorporation or by-laws or any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which the Company or
any of its subsidiaries is a party or by which it or any of them or any
of their respective properties is bound, except, in the case of any
indenture, mortgage, deed of trust, loan agreement or other agreement,
for violations and defaults which would not, singly or in the
aggregate, have a Material Adverse Effect;
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(xi) The statements set forth in the Prospectus under the
caption "Description of Capital Stock", insofar as they purport to
constitute a summary of the terms of the Stock, and under the caption
"U.S. Federal Tax Consequences for Non-United States Holders of Common
Stock", insofar as they purport to describe the provisions of the laws
and documents referred to therein, are accurate and complete in all
material respects;
(xii) Other than as set forth in the Prospectus, there
are no legal or governmental investigations of which the Company has
received notice or proceedings pending against or affecting the
Company or any of its subsidiaries or any of their respective
properties which, if determined adversely to the Company or any of
its subsidiaries, would, singly or in the aggregate, reasonably be
expected to have Material Adverse Effect; and, to the Company's
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others; and there are no
court and administrative orders, writs, judgments and decrees
specifically directed to the Company or any of its subsidiaries and
known to the Company's executive officers to be material to the
Company and its subsidiaries taken as a whole;
(xiii) Each of the Company and 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 and as of each Time of Delivery (as defined in
Section 4 hereof), in each case except as disclosed in the Prospectus
or except where such failure to own, possess or obtain necessary
licenses, permits, certificates, consents, orders, approvals or
authorizations or failure to make necessary declarations and filings
would not, singly or in the aggregate, have a Material Adverse Effect,
and neither the Company nor any such subsidiary has received any actual
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 Prospectus or except as would
not, singly or in the aggregate, have a Material Adverse Effect; and
each of the Company and its subsidiaries is in compliance with all laws
and regulations (other than Environmental Laws (as defined herein))
relating to the conduct of its business as conducted as of the date
hereof and as of each Time of Delivery, except as disclosed in the
Prospectus or except where the failure to comply would not, singly or
in the aggregate, have a Material Adverse Effect;
(xiv) The Company and its subsidiaries (i) are in
compliance with any and all applicable foreign, federal, state and
local laws and regulations relating to the protection of human
health and safety, the environment or hazardous or toxic substances
or wastes, pollutants or contaminants ("Environmental Laws"), (ii)
have received all permits, licenses or other approvals required of
them under applicable Environmental Laws to conduct their respective
businesses and (iii) are in compliance with all terms and conditions
of any such permit, license or other approval, except as
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disclosed in the Prospectus or except where such noncompliance with
Environmental Laws, failure to receive required permits, licenses or
other approvals or failures to comply with the terms and conditions
of such permits, licenses or other approvals would not, singly or in
the aggregate, have a Material Adverse Effect;
(xv) In the ordinary course of its business, the Company
conducts a periodic review of the effect of Environmental Laws on the
business, operations and properties of the Company and its
subsidiaries, in the course of which it identifies and evaluates
associated costs and liabilities; on the basis of such review, the
Company has reasonably concluded that, except as disclosed in the
Prospectus, such associated costs and liabilities would not, singly or
in the aggregate, have a Material Adverse Effect;
(xvi) The Company is not and, after giving effect to the
offering and sale of the Shares, will not be an "investment company",
as such term is defined in the Investment Company Act of 1940, as
amended (the "Investment Company Act");
(xvii) Neither the Company nor any of its affiliates does
business with the government of Cuba or with any person or affiliate
located in Cuba within the meaning of Section 517.075, Florida
Statutes;
(xviii) Xxxxxx Xxxxxxxx LLP, who has certified certain
historical financial information of the containerboard and corrugated
packaging products group of the Selling Stockholder and its
subsidiaries, and Ernst & Young LLP, who has certified certain
historical financial information of the Company and its subsidiaries,
are each, to the Company's knowledge, independent public accountants as
required by the Act and the rules and regulations of the Commission
thereunder; and
(xix) The Company has reviewed its operations and that
of its subsidiaries and any vendors and suppliers with which the
Company or any of its subsidiaries has a material relationship to
evaluate the extent to which the business or operations of the
Company or any of its subsidiaries has been or will be affected by
the Year 2000 Problem. As a result of such review, except as
disclosed in the Prospectus, the Company has no reason to believe,
and does not believe, that the Year 2000 Problem has had or will
have a Material Adverse Effect or has resulted or will result in any
material loss or interference with the Company's business or
operations. The "Year 2000 Problem" as used herein means any
significant risk that computer hardware or software used in the
receipt, transmission, processing, manipulation, storage, retrieval,
retransmission or other utilization of data or in the operation of
mechanical or electrical systems of any kind is not functioning or
will not function, in the case of dates or time periods occurring
after December 31, 1999, at least as effectively as in the case of
dates or time periods occurring prior to January 1, 2000.
(b) The Selling Stockholder represents and warrants to, and
agrees with, each of the Underwriters and the Company that:
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(i) The Selling Stockholder has been duly incorporated
and is validly existing as a corporation in good standing under the
laws of the State of Delaware;
(ii) All consents, approvals, authorizations and orders
necessary for the execution and delivery by the Selling Stockholder of
this Agreement, and for the sale and delivery of the Shares to be sold
by the Selling Stockholder hereunder, have been obtained; and the
Selling Stockholder has full right, power and authority (a) to enter
into this Agreement and this Agreement has been duly executed and
delivered by the Selling Stockholder and (b) to sell, assign, transfer
and deliver the Shares to be sold by the Selling Stockholder hereunder;
(iii) The sale of the Shares to be sold by the Selling
Stockholder hereunder and the compliance by the Selling Stockholder
with all of the provisions of this Agreement and the consummation of
the transactions herein contemplated will not (a) violate the
certificate of incorporation or by-laws of the Selling Stockholder, (b)
constitute a violation by the Selling Stockholder of any applicable
provision of any law, statute or regulation, except for violations
which would not affect the ability of the Selling Stockholder to
deliver the Shares or otherwise consummate the transactions pursuant to
and in accordance with this Agreement, or (c) breach, or result in a
default under, any agreement known to the Selling Stockholder's
executive officers to be material to the Selling Stockholder, except
for conflicts or breaches which would not affect the ability of the
Selling Stockholder to deliver the Shares or otherwise consummate the
transactions pursuant to and in accordance with this Agreement;
(iv) The Selling Stockholder has, and immediately prior to
each Time of Delivery (as defined in Section 4 hereof) the Selling
Stockholder will have, good and valid title to the Shares to be sold by
the Selling Stockholder hereunder, free and clear of all liens,
encumbrances, equities or claims (other than the restrictions on
transfer specifically set forth in the Stockholders Agreement dated as
of April 12, 1999 by and among the Selling Stockholder, the Company and
PCA Holdings LLC, which restrictions will cease to be effective at the
Time of Delivery in respect of Shares delivered and paid for pursuant
hereto); and, upon delivery of such Shares and payment therefor
pursuant hereto, good and valid title to such Shares, free and clear of
all liens, encumbrances, security interests and claims, will pass to
the several Underwriters;
(v) During the period beginning on the date hereof and
continuing to and including the date 180 days after the date of the
Prospectus, not to offer, sell, hedge, contract to sell, hedge or
otherwise dispose of, except as provided hereunder, any securities of
the Company that are substantially similar to the Shares (it being
understood that such securities do not include the Company's 12 3/8%
Senior Exchangeable Preferred Stock due 2010), including but not
limited to any securities that are convertible into or exchangeable
for, or that represent the right to receive, Stock or any such
substantially similar securities (other than pursuant to employee stock
option plans existing on, or upon the conversion or exchange of
convertible or exchangeable securities outstanding as of, the date of
this Agreement), without your prior written consent;
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(vi) The Selling Stockholder has not taken and will not
take, directly or indirectly, any action which is designed to or
which has constituted or which might reasonably be expected to cause
or result in stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the
Shares;
(vii) To the extent that any statements or omissions
made in the Registration Statement, any Preliminary Prospectus, the
Prospectus or any amendment or supplement thereto are made in
reliance upon and in conformity with written information furnished
to the Company by the Selling Stockholder expressly for use therein,
such Preliminary Prospectus and the Registration Statement did, and
the Prospectus and any further amendments or supplements to the
Registration Statement and the Prospectus, when they become
effective or are filed with the Commission, as the case may be, will
conform in all material respects to the requirements of the Act and
the rules and regulations of the Commission thereunder and will not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading;
(viii) In order to document the Underwriters' compliance
with the reporting and withholding provisions of the Tax Equity and
Fiscal Responsibility Act of 1982 with respect to the transactions
herein contemplated, the Selling Stockholder will deliver to you
prior to or at the First Time of Delivery (as hereinafter defined) a
properly completed and executed United States Treasury Department
Form W-9 (or other applicable form or statement specified by
Treasury Department regulations in lieu thereof); and
(ix) The Shares are subject to the interests of the
Underwriters hereunder; the obligations of the Selling Stockholder
hereunder shall not be terminated by operation of law, whether by the
dissolution of the Selling Stockholder, or by the occurrence of any
other event; and if the Selling Stockholder should be dissolved, or if
any other such event should occur, before the delivery of the Shares
hereunder, certificates representing the Shares shall be delivered by
or on behalf of the Selling Stockholder in accordance with the terms
and conditions of this Agreement.
2. Subject to the terms and conditions herein set forth, (a)
the Company and the Selling Stockholder agree, severally and not jointly, to
sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company and the Selling
Stockholder, at a purchase price per share of $ , the number of Firm
Shares (to be adjusted by you so as to eliminate fractional shares)
determined by multiplying the aggregate number of Firm Shares to be sold by
the Company and the Selling Stockholder as set forth opposite their
respective names in Schedule II hereto by a fraction, the numerator of which
is the aggregate number of Firm Shares to be purchased by such Underwriter as
set forth opposite the name of such Underwriter in Schedule I hereto and the
denominator of which is the aggregate number of Firm Shares to be purchased
by all of the Underwriters from the Company and the Selling Stockholder
hereunder and (b) in the event and to the extent that the Underwriters shall
exercise the election to purchase Optional Shares as provided below, the
Selling Stockholder agrees to sell to each of the Underwriters, and each of
the Underwriters agrees, severally and not jointly, to purchase from the
Selling
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Stockholder, at the purchase price per share set forth in clause (a) of this
Section 2, that portion of the number of Optional Shares as to which such
election shall have been exercised (to be adjusted by you so as to eliminate
fractional shares) determined by multiplying such number of Optional Shares
by a fraction the numerator of which is the maximum number of Optional Shares
which such Underwriter is entitled to purchase as set forth opposite the name
of such Underwriter in Schedule I hereto and the denominator of which is the
maximum number of Optional Shares that all of the Underwriters are entitled
to purchase hereunder.
The Selling Stockholder hereby grants to the Underwriters the right
to purchase at their election up to 6,410,240 Optional Shares, at the
purchase price per share set forth in the paragraph above, for the sole
purpose of covering sales of shares in excess of the number of Firm Shares.
Any such election to purchase Optional Shares may be exercised only by
written notice from you to the Selling Stockholder, given within a period of
30 calendar days after the date of this Agreement and setting forth the
aggregate number of Optional Shares to be purchased and the date on which
such Optional Shares are to be delivered, as determined by you but in no
event earlier than the First Time of Delivery (as defined in Section 4
hereof) or, unless you and the Selling Stockholder otherwise agree in
writing, earlier than two or later than ten business days after the date of
such notice.
3. Upon the authorization by you of the release of the Firm
Shares, the several Underwriters propose to offer the Firm Shares for sale
upon the terms and conditions set forth in the Prospectus.
4. (a) The Shares to be purchased by each Underwriter
hereunder, in definitive form, and in such authorized denominations and
registered in such names as Xxxxxxx, Xxxxx & Co. may request upon at least
forty-eight hours' prior notice to the Company and the Selling Stockholder
shall be delivered by or on behalf of the Company and the Selling Stockholder
to Xxxxxxx, Sachs & Co., through the facilities of The Depository Trust
Company ("DTC"), for the account of such Underwriter, against payment by or
on behalf of such Underwriter of the purchase price therefor by wire transfer
of Federal (same-day) funds to the respective accounts specified by the
Company and the Selling Stockholder to Xxxxxxx, Xxxxx & Co. at least
forty-eight hours in advance. The Company and the Selling Stockholder will
cause the certificates representing the Shares to be made available for
checking and packaging at least twenty-four hours prior to each Time of
Delivery (as defined below) with respect thereto at the office of DTC or its
designated custodian (the "Designated Office"). The time and date of such
delivery and payment shall be, with respect to the Firm Shares, 9:30 a.m.,
New York City time, on ............., 2000 or such other time and date as
Xxxxxxx, Sachs & Co., the Company and the Selling Stockholder may agree upon
in writing, and, with respect to the Optional Shares, 9:30 a.m., New York
City time, on the date specified by Xxxxxxx, Xxxxx & Co. in the written
notice given by Xxxxxxx, Sachs & Co. of the Underwriters' election to
purchase such Optional Shares, or such other time and date as Xxxxxxx, Xxxxx
& Co. and the Selling Stockholder may agree upon in writing. Such time and
date for delivery of the Firm Shares is herein called the "First Time of
Delivery", such time and date for delivery of the Optional Shares, if not the
First Time of Delivery, is herein called the "Second Time of Delivery", and
each such time and date for delivery is herein called a "Time of Delivery".
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(b) The documents to be delivered at each Time of
Delivery by or on behalf of the parties hereto pursuant to Section 7 hereof,
including the cross-receipt for the Shares and any additional documents
requested by the Underwriters pursuant to Section 7(m) hereof, will be
delivered at the offices of Xxxxxx Xxxxxx & Xxxxxxx, 00 Xxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000 (the "Closing Location"), and the Shares will be
delivered at the Designated Office, all at each Time of Delivery. A meeting
will be held at the Closing Location at ..............p.m., New York City
time, on the New York Business Day next preceding each Time of Delivery, at
which meeting the final drafts of the documents to be delivered pursuant to
the preceding sentence will be available for review by the parties hereto.
For the purposes of this Section 4, "New York Business Day" shall mean each
Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which
banking institutions in New York are generally authorized or obligated by law
or executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by
you and to file such Prospectus pursuant to Rule 424(b) under the
Act not later than the Commission's close of business on the second
business day following the execution and delivery of this Agreement,
or, if applicable, such earlier time as may be required by Rule
430A(a)(3) under the Act; to make no further amendment or any
supplement to the Registration Statement or Prospectus prior to the
last Time of Delivery which shall be disapproved by you promptly
after reasonable notice thereof; to advise you, promptly after it
receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been
filed and to furnish you copies thereof; to advise you, promptly
after it receives notice thereof, of the issuance by the Commission
of any stop order or of any order preventing or suspending the use
of any Preliminary Prospectus or prospectus, of the suspension of
the qualification of the Shares for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding for
any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement or
Prospectus or for additional information; and, in the event of the
issuance of any stop order or of any order preventing or suspending
the use of any Preliminary Prospectus or prospectus or suspending
any such qualification, promptly to use its best efforts to obtain
the withdrawal of such order;
(b) Promptly from time to time to take such action as
you may reasonably request to qualify the Shares for offering and
sale under the securities laws of such jurisdictions as you may
request and to comply with such laws so as to permit the continuance
of sales and dealings therein in such jurisdictions for as long as
may be necessary to complete the distribution of the Shares,
provided that in connection therewith the Company shall not be
required to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction;
(c) Prior to 11:00 A.M., New York City time, on the
New York Business Day next succeeding the date of this Agreement and
from time to time, to furnish the Underwriters with copies of the
Prospectus in New York City in such quantities as
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you may reasonably request, and, if the delivery of a prospectus is
required at any time prior to the expiration of nine months after
the time of issue of the Prospectus in connection with the offering
or sale of the Shares and if at such time any events shall have
occurred 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 in order to make the
statements therein, in the light of the circumstances under which
they were made when such Prospectus is delivered, not misleading,
or, if for any other reason it shall be necessary during such period
to amend or supplement the Prospectus in order to comply with the
Act, to notify you and upon your request to prepare and furnish
without charge to each Underwriter and to any dealer in securities
as many copies as you may from time to time reasonably request of an
amended Prospectus or a supplement to the Prospectus which will
correct such statement or omission or effect such compliance, and in
case any Underwriter is required to deliver a prospectus in
connection with sales of any of the Shares at any time nine months
or more after the time of issue of the Prospectus, upon your request
but at the expense of such Underwriter, to prepare and deliver to
such Underwriter as many copies as you may request of an amended or
supplemented Prospectus complying with Section 10(a)(3) of the Act;
(d) To make generally available to its securityholders
as soon as practicable, but in any event not later than eighteen
months after the effective date of the Registration Statement (as
defined in Rule 158(c) under the Act), an earnings statement of the
Company and its subsidiaries (which need not be audited) complying
with Section 11(a) of the Act and the rules and regulations of the
Commission thereunder (including, at the option of the Company, Rule
158);
(e) During the period beginning on the date hereof and
continuing to and including the date 180 days after the date of the
Prospectus, not to offer, sell, hedge, contract to sell, hedge or
otherwise dispose of, except as provided hereunder, any securities
of the Company that are substantially similar to the Shares (it
being understood that such securities do not include the Company's
12 3/8% Senior Exchangeable Preferred Stock due 2010), including but
not limited to any securities that are convertible into or
exchangeable for, or that represent the right to receive, Stock or
any such substantially similar securities (other than pursuant to
employee stock option plans existing on, or upon the conversion or
exchange of convertible or exchangeable securities outstanding as
of, the date of this Agreement), without your prior written consent;
(f) To furnish to its stockholders as soon as
practicable after the end of each fiscal year an annual report
(including a balance sheet and statements of income, stockholders'
equity and cash flows of the Company and its consolidated
subsidiaries certified by independent public accountants) and, as
soon as practicable after the end of each of the first three
quarters of each fiscal year (beginning with the fiscal quarter
ending after the effective date of the Registration Statement), to
make available to its stockholders consolidated summary financial
information of the Company and its subsidiaries for such quarter in
reasonable detail;
11
(g) During a period of three years from the effective
date of the Registration Statement, to furnish to you copies of all
reports or other communications (financial or other) furnished to
stockholders, and to deliver to you (i) as soon as they are
available, copies of any reports and financial statements furnished
to or filed with the Commission or any national securities exchange
on which any class of securities of the Company is listed; and (ii)
such additional information concerning the business and financial
condition of the Company as you may from time to time reasonably
request (such financial statements to be on a consolidated basis to
the extent the accounts of the Company and its subsidiaries are
consolidated in reports furnished to its stockholders generally or
to the Commission);
(h) To use the net proceeds received by it from the
sale of the Firm Shares pursuant to this Agreement in the manner
specified in the Prospectus under the caption "Use of Proceeds";
(i) To use its best efforts to list, subject to notice
of issuance, the Shares on the New York Stock Exchange (the
"Exchange"); and
(j) If the Company elects to rely upon Rule 462(b),
the Company shall file a Rule 462(b) Registration Statement with the
Commission in compliance with Rule 462(b) by 10:00 P.M., Washington,
D.C. time, on the date of this Agreement, and the Company shall at
the time of filing either pay to the Commission the filing fee for
the Rule 462(b) Registration Statement or give irrevocable
instructions for the payment of such fee pursuant to Rule 111(b)
under the Act.
6. The Company and the Selling Stockholder, jointly and
severally, covenant and agree with one another and with the several
Underwriters that (a) the Company will pay or cause to be paid the following:
(i) the fees, disbursements and expenses of the Company's counsel and
accountants; (ii) the fees, disbursements and expenses of one firm selected
as counsel for the Selling Stockholder in connection with the registration of
the Shares; (iii) all expenses, including registration and filing fees, in
connection with the preparation, printing, filing and distribution of the
registration statement, any preliminary prospectus or final prospectus, term
sheets and any other offering documents, and amendments and supplements
thereto, and the mailing and delivering of copies thereof to any underwriters
and dealers; (iv) the cost of printing or producing any underwriting
agreements and blue sky or legal investment memoranda, and any other
documents in connection with the offering, sale or delivery of the Shares;
(v) all expenses in connection with the qualification of the Shares for
offering and sale under state securities laws, including the fees,
disbursements and expenses of counsel for the underwriters in connection with
such qualification and in connection with blue sky and legal investment
surveys; (vi) the filing fees incident to securing any required review by the
National Association of Securities Dealers, Inc. of the terms of the sale of
the Shares; (vii) transfer agents' and registrars' fees and expenses and the
fees and expenses of any other agent or trustee appointed in connection with
such offering; (viii) all security engraving and security printing expenses;
(ix) all fees, disbursements and expenses payable in connection with the
listing of the Shares on any securities exchange or automated interdealer
quotation system and the rating of such Shares; and (x) other out-of-pocket
expenses of the Selling Stockholder with respect to participating in such
registration to the ex-
12
tent the Company is contractually obligated to pay such expenses; and (b) the
Selling Stockholder will pay or cause to be paid all expenses and taxes
incident to the sale and delivery of the Shares to be sold by the Selling
Stockholder to the Underwriters hereunder. Notwithstanding the foregoing, the
Selling Stockholder and the Company shall each be responsible for its own
internal administrative and similar costs. In connection with clause (b) of
the preceding sentence, Xxxxxxx, Sachs & Co. agrees to pay New York State
stock transfer tax, and the Selling Stockholder agrees to reimburse Xxxxxxx,
Xxxxx & Co. for associated carrying costs if such tax payment is not rebated
on the day of payment and for any portion of such tax payment not rebated. It
is understood, however, that, except as provided in this Section, and
Sections 8 and 11 hereof, the Underwriters will pay all of their own costs
and expenses, including the fees of their counsel, stock transfer taxes on
resale of any of the Shares by them, and any advertising expenses connected
with any offers they may make. Notwithstanding any other provision in this
Agreement to the contrary, the Company and the Selling Shareholder agree
that, as between them, the responsibility for expenses, including the
expenses described in this Section 6, shall be determined as set forth in the
Registration Rights Agreement dated April 12, 1999 among the Company, the
Selling Shareholder and PCA Holdings LLC, and, further, that if a party is
required under this Agreement to pay an amount for which the other party is
responsible under such Registration Rights Agreement, the responsible party
shall, upon demand, reimburse the other party.
7. The obligations of the Underwriters hereunder, as to the
Shares to be delivered at each Time of Delivery, shall be subject, in their
discretion, to the condition that all representations and warranties and
other statements of the Company and of the Selling Stockholder herein are, at
and as of such Time of Delivery, true and correct, the condition that the
Company and the Selling Stockholder shall have performed all of its and their
obligations hereunder theretofore to be performed, and the following
additional conditions:
(a) The Prospectus shall have been filed with the
Commission pursuant to Rule 424(b) within the applicable time period
prescribed for such filing by the rules and regulations under the
Act and in accordance with Section 5(a) hereof; if the Company has
elected to rely upon Rule 462(b), the Rule 462(b) Registration
Statement shall have become effective by 10:00 P.M., Washington,
D.C. time, on the date of this Agreement; no stop order suspending
the effectiveness of the Registration Statement or any part thereof
shall have been issued and no proceeding for that purpose shall have
been initiated or threatened by the Commission; and all requests for
additional information on the part of the Commission shall have been
complied with to your reasonable satisfaction;
(b) Xxxxxx Xxxxxx & Xxxxxxx, counsel for the
Underwriters, shall have furnished to you such written opinion or
opinions (a draft of each such opinion is attached as Annex II(a)
hereto), dated such Time of Delivery, with respect to such matters
as you 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;
13
(c) Xxxxxxxx & Xxxxx, counsel for the Company, shall
have furnished to you their written opinion (a draft of such opinion
is attached as Annex II(b) hereto), dated such Time of Delivery, in
form and substance satisfactory to you, to the effect that:
(i) The Company has been duly incorporated
under the General Corporation Law of the State of Delaware;
(ii) The Company is existing and in good
standing under the General Corporation Law of the State of
Delaware (for purposes of the opinions in this paragraph,
such counsel being entitled to rely exclusively upon the
certificates issued by the governmental authorities in the
State of Delaware);
(iii) As of the date of such Time of Delivery,
the authorized capital stock of the Company consists of (A)
300,000,000 shares of common stock, par value $0.01 per
share, and (B) 3,000,100 shares of preferred stock
consisting of (x) 3,000,000 shares of Senior Exchangeable
Preferred Stock due 2010, par value $0.01 per share and (y)
100 shares of Junior Preferred Stock, par value $0.01 per
share; the outstanding capital stock of the Company
(including the Shares being delivered at such Time of
Delivery) has been duly authorized and is validly issued,
fully paid and non-assessable;
(iv) The issuance of the Shares to be sold by
the Company has been duly authorized and, when appropriate
certificates representing such Shares are duly
countersigned by the Company's transfer agent and registrar
and delivered against payment of the agreed consideration
therefor in accordance with the terms of this Agreement,
will be validly issued, fully paid and non-assessable, and
nothing has come to the attention of such counsel that has
caused such counsel to conclude that the issuance of such
shares will be subject to any preemptive or similar rights;
(v) PCA Hydro, Inc. is existing and in good
standing under the General Corporation Law of the State of
Delaware; Xxxxx Container Corporation is existing and in
good standing under the Virginia Stock Corporation Act (for
purposes of the opinions in this paragraph, such counsel
being entitled to rely exclusively upon the certificates
issued by the governmental authorities in the required
jurisdictions);
(vi) As of the date of such Time of Delivery,
based solely upon review of the stock ledgers of each of
the subsidiaries of the Company, the Company is the record
holder of all of the outstanding shares of capital stock of
each of its subsidiaries;
(vii) The Company has the corporate power to
enter into and perform its obligations under this Agreement
and to issue, sell and deliver the Firm Shares as
contemplated by this Agreement; the Company has the
corporate power to own and lease its properties and to
conduct its business as described in the Prospectus;
14
(viii) The Board of Directors of the Company has
adopted by requisite vote the resolutions necessary to
authorize the execution, delivery and performance of this
Agreement; no approval by the stockholders of the Company
is required, except as shall have been obtained;
(ix) The Company has duly executed and
delivered this Agreement;
(x) To such counsel's actual knowledge, no
legal or governmental investigations or proceedings are
pending or overtly threatened to which the Company or any
of its subsidiaries is a party or to which the property or
assets of the Company or any of its subsidiaries is subject
(i) that would be required under Item 103 of Regulation S-K
under the Act to be disclosed in a registration statement
or a prospectus delivered at the time of confirmation of
the sale of any offering of securities registered under the
Act that are not described in the Prospectus or (ii) which
seeks to restrain, enjoin or prevent the consummation of or
otherwise challenge the issuance or sale of the Shares or
the consummation of the other transactions contemplated by
this Agreement;
(xi) The issue and sale of the Shares to be
sold by the Company in accordance with the provisions of
this Agreement and the consummation by the Company of the
transactions herein contemplated will not (a) violate the
certificate or articles of incorporation or by-laws of the
Company or any of its subsidiaries, (b) constitute a
violation by the Company or any of its subsidiaries of any
applicable provision of any law, statute or regulation
(except with respect to compliance with any disclosure
requirement or any prohibition against fraud or
misrepresentation or as to whether performance of the
indemnification or contribution provisions in this
Agreement would be permitted, as to which such counsel need
express no opinion) or (c) breach, or result in a default
under, any existing obligation of the Company and its
subsidiaries under any of its Other Specified Agreement (a
list of which is attached to such counsel's opinion);
(xii) To such counsel's knowledge, no consent,
approval, authorization, order, registration or
qualification of or with any court or governmental agency
or body is required for the issue and sale of the Shares or
the consummation by the Company of the transactions
contemplated by this Agreement, except the registration
under the Act and the Securities Exchange Act of 1934, as
amended, of the Shares, and such consents, approvals,
authorizations, orders, registrations or qualifications (a)
as may be required under state or foreign securities or
Blue Sky laws in connection with the purchase and
distribution of the Shares by the Underwriters, (b) as have
been obtained or (c) the failure to obtain which would not
have, singly or in the aggregate, a Material Adverse Effect;
15
(xiii) The statements set forth in the
Prospectus under the caption "Description of Capital
Stock", insofar as they purport to constitute a summary of
the terms of the Stock, are correct in all material
respects;
(xiv) The Company is not an "investment
company", as such term is defined in the Investment Company
Act; and
(xv) Based upon such counsel's participation
in conferences and its document review, its understanding
of applicable law and the experience it has gained in its
practice thereunder and relying as to matters of fact upon
the statements of officers and other representatives of the
Company, such counsel can advise that nothing has come to
its attention that has caused it to conclude that (i) the
Registration Statement or any further amendment or
supplement thereto made by the Company prior to such Time
of Delivery (other than financial statements and related
notes and other financial and accounting data included in
the Registration Statement, as to which no advice need be
given) at its effective date contained an untrue statement
of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the
statements therein not misleading or (ii) the Prospectus or
any further amendment or supplement thereto made by the
Company prior to such Time of Delivery (other than
financial statements and related notes and other financial
and accounting data included in the Prospectus, as to which
no advice need be given) at the date it bears or on the
date of this letter contained an untrue statement of a
material fact or omitted to state a material fact necessary
in order to make the statements therein, in light of the
circumstances under which they were made, not misleading or
(iii) as of the effective date, either the Registration
Statement or the Prospectus (other than financial
statements and related notes and other financial and
accounting data included in the Registration Statement, as
to which no advice need be given) appeared on its face not
to be responsive in all material respects to the
requirements of Form S-1.
In rendering such opinion, such counsel may state that they
express no opinion as to any laws other than the internal laws of the
State of New York, the General Corporation Law of the State of Delaware
and the federal law of the United States;
(d) Xxxx X. Xxxxx, Corporate Counsel of the Company, shall
have furnished to you his written opinion, dated such Time of Delivery,
in form and substance satisfactory to you, to the effect that the
Company has been duly qualified as a foreign corporation for the
transaction of business and is in good standing under the laws of each
jurisdiction other than Delaware in which it owns or leases properties
or conducts any business, other than where the failure to be so
qualified or in good standing would not, singly or in the aggregate,
reasonably be expected to have a Material Adverse Effect (such counsel
being entitled to rely in respect of the opinion in this clause upon
certificates issued by governmental authorities in the required
jurisdictions and upon opinions of local counsel and in respect of
matters of fact upon certificates of officers of the Company);
16
(e) Jenner & Block, counsel for the Selling
Stockholder, shall have furnished to you its written opinion (a
draft of such opinion is attached as Annex II(c) hereto), dated such
Time of Delivery, in form and substance satisfactory to you, to the
effect that:
(i) This Agreement has been duly executed and
delivered by or on behalf of the Selling Stockholder; and
the sale of the Shares to be sold by the Selling
Stockholder hereunder and the compliance by the Selling
Stockholder with all of the provisions of this Agreement
and the consummation of the transactions herein
contemplated will not (a) violate the certificate of
incorporation or by-laws of the Selling Stockholder, (b)
constitute a violation by the Selling Stockholder of any
applicable provision of any law, statute or regulation
known to such counsel, except for violations which would
not affect the ability of the Selling Stockholder to
deliver the Shares or otherwise consummate the transactions
pursuant to and in accordance with this Agreement, or (c)
breach, or result in a default under, any agreement known
to such counsel and the executive officers of the Selling
Stockholder to be material to the Selling Stockholder,
except for conflicts or breaches which would not affect the
ability of the Selling Stockholder to deliver the Shares or
otherwise consummate the transactions pursuant to and in
accordance with this Agreement;
(ii) No consent, approval, authorization, order,
license, registration or qualification of or with any court or
governmental agency or body is required for the consummation
by the Selling Stockholder of the transactions contemplated by
this Agreement to be performed by it in connection with the
Shares to be sold by the Selling Stockholder hereunder, except
such as have been obtained under the Act and such as may be
required under state or foreign securities or Blue Sky laws in
connection with the purchase and distribution of such Shares
by the Underwriters;
(iii) Immediately prior to such Time of
Delivery the Selling Stockholder had good and valid title
to the Shares to be sold at such Time of Delivery by the
Selling Stockholder under this Agreement, free and clear of
all liens, encumbrances, security interests and claims, and
full right, power and authority to sell, assign, transfer
and deliver the Shares to be sold by the Selling
Stockholder hereunder; and
(iv) Good and valid title to such Shares, free
and clear of all liens, encumbrances, security interests
and claims, has been transferred to each of the several
Underwriters who have purchased such Shares in good faith
and without notice of any such lien, encumbrance, equity or
claim or any other adverse claim within the meaning of the
Uniform Commercial Code.
In rendering such opinion, such counsel may state that they
express no opinion as to the laws of any jurisdiction outside the
United States and such counsel may rely upon a certificate of the
Selling Stockholder in respect of matters of fact (includ-
17
ing as to ownership of, and liens, encumbrances, security interests
and claims on, the Shares sold by the Selling Stockholder), provided
that such counsel shall state that they believe that both you and
they are justified in relying upon such certificate;
(f) On the date of the Prospectus at a time prior to the
execution of this Agreement, at 9:30 a.m., New York City time, on the
effective date of any post-effective amendment to the Registration
Statement filed subsequent to the date of this Agreement and also at
each Time of Delivery, each of Xxxxxx Xxxxxxxx LLP and Ernst & Young
LLP shall have furnished to you a letter or letters, dated the
respective dates of delivery thereof, in form and substance
satisfactory to you, to the effect set forth in Annex I hereto (the
executed copy of the letters delivered prior to the execution of this
Agreement is attached as Annex I(a) hereto and a draft of the form of
letters to be delivered on the effective date of any post-effective
amendment to the Registration Statement and as of each Time of Delivery
is attached as Annex I(b) hereto);
(g) (i) Neither the Company nor any of its
subsidiaries shall have sustained since the date of the latest
audited financial statements included in the Prospectus any loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus, and (ii) since
the respective dates as of which information is given in the
Prospectus there shall not have been any change in the capital stock
(other than pursuant to the grant or exercise of options under plans
described in the Prospectus) or increase in the long-term debt of
the Company or any of its subsidiaries or any change, or any
development involving a prospective change, in or affecting the
general affairs, management, financial position, stockholders'
equity or results of operations of the Company and its subsidiaries,
taken as a whole, otherwise than as set forth or contemplated in the
Prospectus, the effect of which, in any such case described in
clause (i) or (ii), is in the judgment of the Representatives so
material and adverse as to make it impracticable or inadvisable to
proceed with the public offering or the delivery of the Shares being
delivered at such Time of Delivery on the terms and in the manner
contemplated in the Prospectus;
(h) On or after the date hereof (i) no downgrading
shall have occurred in the rating accorded the Company's debt
securities or preferred stock by any "nationally recognized
statistical rating organization", as that term is defined by the
Commission for purposes of Rule 436(g)(2) under the Act, and (ii) no
such organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its
rating of any of the Company's debt securities or preferred stock;
(i) On or after the date hereof there shall not have
occurred any of the following: (i) a suspension or material
limitation in trading in securities generally on the New York Stock
Exchange; (ii) a suspension or material limitation in trading in the
Company's securities on the New York Stock Exchange; (iii) a general
moratorium on commercial banking activities declared by either
Federal or New York State authorities; or (iv) the outbreak or
escalation of hostilities involving the United States or the
18
declaration by the United States of a national emergency or war, if
the effect of any such event specified in this clause (iv) in the
judgment of the Representatives makes it impracticable or
inadvisable to proceed with the public offering or the delivery of
the Shares being delivered at such Time of Delivery on the terms and
in the manner contemplated in the Prospectus;
(j) The Shares to be sold by the Company and the
Selling Stockholder at such Time of Delivery shall have been duly
listed, subject to notice of issuance, on the Exchange;
(k) The Company has obtained and delivered to the
Underwriters executed copies of an agreement from the persons named
in Schedule III hereto to the effect set forth in Subsection 1(b)(v)
hereof in form and substance satisfactory to you;
(l) The Company shall have complied with the
provisions of Section 5(c) hereof with respect to the furnishing of
prospectuses on the New York Business Day next succeeding the date
of this Agreement; and
(m) The Company and the Selling Stockholder shall have
furnished or caused to be furnished to you at such Time of Delivery
certificates of officers of the Company and of the Selling
Stockholder, respectively, satisfactory to you as to the accuracy of
the representations and warranties of the Company and the Selling
Stockholder, respectively, herein at and as of such Time of
Delivery, as to the performance by the Company and the Selling
Stockholder of all of their respective obligations hereunder to be
performed at or prior to such Time of Delivery, and as to such other
matters as you may reasonably request, and the Company shall have
furnished or caused to be furnished certificates as to the matters
set forth in subsections (a) and (g) of this Section, and as to such
other matters as you may reasonably request.
8. (a) The Company and the Selling Stockholder, jointly
and severally, will indemnify and hold harmless each Underwriter against any
losses, claims, damages or liabilities, joint or several, to which such
Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, the Registration
Statement or the Prospectus, or any amendment or supplement thereto, 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 for
any legal or other expenses reasonably incurred by such Underwriter in
connection with investigating or defending any such action or claim as such
expenses are incurred; PROVIDED, HOWEVER, that the Company and the Selling
Stockholder shall not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
any Preliminary Prospectus, the Registration Statement or the Prospectus or
any such amendment or supplement in reliance upon and in conformity with
written information furnished to the Company by any Underwriter through
Xxxxxxx, Xxxxx & Co. expressly for use therein;
19
PROVIDED, FURTHER, that the liability of the Selling Stockholder pursuant to
this subsection (a) shall not exceed the product of the number of Shares sold
by the Selling Stockholder, including any Optional Shares, and the initial
public offering price of the Shares as set forth in the Prospectus.
(b) Each Underwriter will indemnify and hold harmless
the Company and the Selling Stockholder against any losses, claims, damages
or liabilities to which the Company or the Selling Stockholder may become
subject, under the Act or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon
an untrue statement or alleged untrue statement of a material fact contained
in any Preliminary Prospectus, the Registration Statement or the Prospectus,
or any amendment or supplement thereto, 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, 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 any
Preliminary Prospectus, the Registration Statement or the Prospectus or any
such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through Xxxxxxx,
Sachs & Co. expressly for use therein; and will reimburse the Company and the
Selling Stockholder for any legal or other expenses reasonably incurred by
the Company or the Selling Stockholder in connection with investigating or
defending any such action or claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party
under subsection (a) or (b) above of notice of the commencement of any
action, such indemnified party shall, if a claim in respect thereof is to be
made against an indemnifying party under such subsection, notify the
indemnifying party in writing of the commencement thereof; but the omission
so to notify the indemnifying party shall not relieve it from any liability
which it may have to any indemnified party otherwise than under such
subsection. In case any such action shall be brought against any indemnified
party and it shall notify the indemnifying party of the commencement thereof,
the indemnifying party shall be entitled to participate therein and, to the
extent that it shall wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel satisfactory
to such indemnified party (which 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 shall not be liable to
such indemnified party under such subsection for any legal expenses of other
counsel or any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than
reasonable costs of investigation. No indemnifying party shall, without the
written consent of the indemnified party, effect the settlement or compromise
of, or consent to the entry of any judgment with respect to, any pending or
threatened action or claim in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified party is
an actual or potential party to such action or claim) unless such settlement,
compromise or judgment (i) includes an unconditional release of the
indemnified party from all liability arising out of such action or claim and
(ii) does not include a statement as to or an admission of fault, culpability
or a failure to act, by or on behalf of any indemnified party.
20
(d) If the indemnification provided for in this
Section 8 is unavailable to or insufficient to hold harmless an indemnified
party under subsection (a) or (b) above in respect of any losses, claims,
damages or liabilities (or actions in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or payable
by such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect the relative benefits received by the Company and the
Selling Stockholder on the one hand and the Underwriters on the other from
the offering of the Shares. If, however, the allocation provided by the
immediately preceding sentence is not permitted by applicable law or if the
indemnified party failed to give the notice required under subsection (c)
above, then each indemnifying party shall contribute to such amount paid or
payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company and the Selling Stockholder on the one hand and the Underwriters on
the other in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities (or actions in respect thereof),
as well as any other relevant equitable considerations. The relative benefits
received by the Company and the Selling Stockholder 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 of the Shares purchased under this
Agreement (before deducting expenses) received by the Company and the Selling
Stockholder bear to the total underwriting discounts and commissions received
by the Underwriters with respect to the Shares purchased under this
Agreement, in each case as set forth in the table on the cover page of the
Prospectus. The relative fault shall be determined by reference to, 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 Selling Stockholder on the one
hand or the Underwriters on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company, the Selling Stockholder and the
Underwriters agree that it would not be just and equitable if contributions
pursuant to this subsection (d) were determined by PRO RATA allocation (even
if the Underwriters were treated as one entity for such purpose) or by any
other method of allocation which does not take account of the equitable
considerations referred to above in this subsection (d). The amount paid or
payable by an indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to above in 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 such action or claim. 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 Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations in this
subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) The obligations of the Company and the Selling
Stockholder under this Section 8 shall be in addition to any liability which
the Company and the Selling Stockholder may
21
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 Act;
and the obligations of the Underwriters under this Section 8 shall be in
addition to any liability which the respective Underwriters may otherwise
have and shall extend, upon the same terms and conditions, to each officer
and director of the Company and to each person, if any, who controls the
Company or the Selling Stockholder within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation
to purchase the Shares which it has agreed to purchase hereunder at a Time of
Delivery, you may in your discretion arrange for you or another party or
other parties to purchase such Shares on the terms contained herein. If
within thirty-six hours after such default by any Underwriter you do not
arrange for the purchase of such Shares, then the Company and the Selling
Stockholder shall be entitled to a further period of thirty-six hours within
which to procure another party or other parties satisfactory to you to
purchase such Shares on such terms. In the event that, within the respective
prescribed periods, you notify the Company and the Selling Stockholder that
you have so arranged for the purchase of such Shares, or the Company and the
Selling Stockholder notify you that they have so arranged for the purchase of
such Shares, you or the Company and the Selling Stockholder shall have the
right to postpone such Time of Delivery for a period of not more than seven
days, in order to effect whatever changes may thereby be made necessary in
the Registration Statement or the Prospectus, or in any other documents or
arrangements, and the Company agrees to file promptly any amendments to the
Registration Statement or the Prospectus which in your opinion may thereby be
made necessary. The term "Underwriter" as used in this Agreement shall
include any person substituted under this Section with like effect as if such
person had originally been a party to this Agreement with respect to such
Shares.
(b) If, after giving effect to any arrangements for
the purchase of the Shares of a defaulting Underwriter or Underwriters by you
and the Company and the Selling Stockholder as provided in subsection (a)
above, the aggregate number of such Shares which remains unpurchased does not
exceed one-eleventh of the aggregate number of all of the Shares to be
purchased at such Time of Delivery, then the Company and the Selling
Stockholder shall have the right to require each non-defaulting Underwriter
to purchase the number of Shares which such Underwriter agreed to purchase
hereunder at such Time of Delivery and, in addition, to require each
non-defaulting Underwriter to purchase its pro rata share (based on the
number of Shares which such Underwriter agreed to purchase hereunder) of the
Shares of such defaulting Underwriter or Underwriters for which such
arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for
the purchase of the Shares of a defaulting Underwriter or Underwriters by you
and the Company and the Selling Stockholder as provided in subsection (a)
above, the aggregate number of such Shares which remains unpurchased exceeds
one-eleventh of the aggregate number of all of the Shares to be purchased at
such Time of Delivery, or if the Company and the Selling Stockholder shall
not exercise the right described in subsection (b) above to require
non-defaulting Underwriters to purchase Shares of a defaulting Underwriter or
Underwriters, then this Agreement (or, with respect to the Second Time of
Delivery, the obligations of the Underwriters to purchase and of the Selling
Stockholder to sell the Optional Shares) shall thereupon terminate, without
li-
22
ability on the part of any non-defaulting Underwriter or the Company or the
Selling Stockholder, except for the expenses to be borne by the Company and
the Selling Stockholder and the Underwriters as provided in Section 6 hereof
and the indemnity and contribution agreements in Section 8 hereof; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
10. The respective indemnities, agreements, representations,
warranties and other statements of the Company, the Selling Stockholder and
the several Underwriters, as set forth in this Agreement or made by or on
behalf of them, respectively, pursuant to this Agreement, shall remain in
full force and effect, regardless of any investigation (or any statement as
to the results thereof) made by or on behalf of any Underwriter or any
controlling person of any Underwriter, or the Company, or the Selling
Stockholder, or any officer or director or controlling person of the Company,
or any controlling person of the Selling Stockholder, and shall survive
delivery of and payment for the Shares. No indemnity, agreement,
representation, warranty, statement or other provision of this Agreement
shall, solely as between the Company and the Selling Stockholder, amend or
modify any other agreement by and among the Company, Tenneco Automotive Inc.
(formerly Tenneco Inc.) and/or the Selling Stockholder; and each indemnity,
agreement, representation, warranty and other statement of the Company or the
Selling Stockholder set forth herein shall not, solely as among such parties
and the several Underwriters, be affected or governed by any such agreement.
11. If this Agreement shall be terminated pursuant to Section 9
hereof, neither the Company nor the Selling Stockholder shall then be under
any liability to any Underwriter except as provided in Sections 6 and 8
hereof; but, if for any other reason any Shares are not delivered by or on
behalf of the Company and/or the Selling Stockholder as provided herein, the
Company will reimburse the Underwriters through you for all out-of-pocket
expenses approved in writing by you, including fees and disbursements of
counsel, reasonably incurred by the Underwriters in making preparations for
the purchase, sale and delivery of the Shares not so delivered, but the
Company and the Selling Stockholder shall then be under no further liability
to any Underwriter in respect of the Shares not so delivered except as
provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each
of the Underwriters, and the parties hereto shall be entitled to act and rely
upon any statement, request, notice or agreement on behalf of any Underwriter
made or given by you jointly or by Xxxxxxx, Xxxxx & Co. on behalf of you as
the representatives.
All statements, requests, notices and agreements hereunder shall be
in writing, and if to the Underwriters shall be delivered or sent by mail,
telex or facsimile transmission to you as the representatives in care of
Xxxxxxx, Sachs & Co., 00 Xxx Xxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Registration Department; if to the Selling Stockholder shall be
delivered or sent by mail, telex or facsimile transmission to counsel for the
Selling Stockholder at its address set forth in Schedule II hereto; and if to
the Company shall be delivered or sent by mail, telex or facsimile
transmission to the address of the Company set forth in the Registration
Statement, Attention: Secretary; provided, however, that any notice to an
Underwriter pursuant to Section 8 (c) hereof shall be delivered or sent by
mail, telex or facsimile transmission to such Underwriter at its address set
forth in its Underwriters' Questionnaire or
23
telex constituting such Questionnaire, which address will be supplied to the
Company or the Selling Stockholder by you upon request. Any such statements,
requests, notices or agreements shall take effect upon receipt thereof.
13. This Agreement shall be binding upon, and inure solely to
the benefit of, the Underwriters, the Company and the Selling Stockholder
and, to the extent provided in Sections 8 and 10 hereof, the officers and
directors of the Company and each person who controls the Company, the
Selling Stockholder or any Underwriter, and their respective heirs,
executors, administrators, successors and assigns, and no other person shall
acquire or have any right under or by virtue of this Agreement. No purchaser
of any of the Shares from any Underwriter shall be deemed a successor or
assign by reason merely of such purchase.
14. Time shall be of the essence for purposes of this
Agreement. As used herein, the term "business day" shall mean any day when
the Commission's office in Washington, D.C. is open for business.
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
16. This Agreement may be executed by any one or more of the
parties hereto 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 instrument.
24
If the foregoing is in accordance with your understanding, please
sign and return to us ten counterparts hereof, and upon the acceptance hereof
by you, on behalf of each of the Underwriters, this letter and such
acceptance hereof shall constitute a binding agreement among each of the
Underwriters, the Company and the Selling Stockholder. It is understood that
your acceptance of this letter on behalf of each of the Underwriters is
pursuant to the authority set forth in a form of Agreement among
Underwriters, the form of which shall be submitted to the Company and the
Selling Stockholder for examination upon request, but without warranty on
your part as to the authority of the signers thereof.
Very truly yours,
PACKAGING CORPORATION OF AMERICA
By: ______________________________
Name:
Title:
PACTIV CORPORATION
By: ______________________________
Name:
Title:
25
Accepted as of the date hereof
in New York, New York:
Xxxxxxx, Xxxxx & Co.
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxx Xxxxx Barney Inc.
Deutsche Bank Securities Inc.
X.X. Xxxxxx Securities Inc.
By: ______________________________________
(Xxxxxxx, Sachs & Co.)
26
SCHEDULE I
Number of Optional
Shares to Be
Total Number of Purchased if
Firm Shares Maximum Option
Underwriter to Be Purchased Exercised
----------- --------------- ------------------
Xxxxxxx, Xxxxx & Co.....................
Xxxxxx Xxxxxxx & Co. Incorporated.......
Xxxxxxx Xxxxx Barney Inc................
Deutsche Bank Securities Inc............
X.X. Xxxxxx Securities Inc..............
--------------- -------------------
Total.............................. 46,250,000 6,410,240
=============== ===================
SCHEDULE II
Number of Optional
Shares to Be
Total Number of Sold if
Firm Shares Maximum Option
Underwriter to Be Sold Exercised
----------- --------------- -------------------
The Company............................. 11,500,000 0
The Selling Stockholder................. 34,750,000 6,410,240
-------------- -------------------
Total.............................. 46,250,000 6,410,240
============== ===================
SCHEDULE III
LOCKUP AGREEMENTS
-----------------
Packaging Corporation of America
PCA Holdings LLC
Madison Dearborn Partners, LLC
Madison Dearborn Capital Partners III, L.P.
Madison Dearborn Special Equity III, L.P.
Special Advisors Fund I, LLC
X.X. Xxxxxx Capital Corporation
Sixty Wall Street Fund, L.P.
BT Capital Investors, X.X.
Xxxxxxxx Street Partners II
Pactiv Corporation
Xxxx X. Xxxxxx
Xxxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxx
Xxxx X. Xxxxxxx
Xxxxxx X. Xxxxx
Xxxx X. Xxxx
Xxxxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxxx
Xxxx X. Xxxxxx 1999 Dynastic Trust
Each of the signatories to the Management Equity Agreement Among
Packaging Corporation of America and each of the persons listed on the
signature pages thereto, dated as of June 1, 1999.
ANNEX I
Pursuant to Section 7(f) of the Underwriting Agreement, the
accountants shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants
with respect to the Company and its subsidiaries within the meaning
of the Act and the applicable published rules and regulations
thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules (and, if
applicable, financial forecasts and/or pro forma financial
information) examined by them and included in the Prospectus or the
Registration Statement comply as to form in all material respects
with the applicable accounting requirements of the Act and the
related published rules and regulations thereunder; and, if
applicable, they have made a review in accordance with standards
established by the American Institute of Certified Public
Accountants of the unaudited consolidated interim financial
statements, selected financial data, pro forma financial
information, financial forecasts and/or condensed financial
statements derived from audited financial statements of the Company
for the periods specified in such letter, as indicated in their
reports thereon, copies of which have been furnished to the
representatives of the Underwriters (the "Representatives") and are
attached hereto;
(iii) They have made a review in accordance with
standards established by the American Institute of Certified Public
Accountants of the unaudited condensed consolidated statements of
income, consolidated balance sheets and consolidated statements of
cash flows included in the Prospectus as indicated in their reports
thereon copies of which are attached hereto and on the basis of
specified procedures including inquiries of officials of the Company
who have responsibility for financial and accounting matters
regarding whether the unaudited condensed consolidated financial
statements referred to in paragraph (vi)(A)(i) below comply as to
form in all material respects with the applicable accounting
requirements of the Act and the related published rules and
regulations, nothing came to their attention that caused them to
believe that the unaudited condensed consolidated financial
statements do not comply as to form in all material respects with
the applicable accounting requirements of the Act and the related
published rules and regulations;
(iv) The unaudited selected financial information with
respect to the consolidated results of operations and financial
position of the Company for the five most recent fiscal years
included in the Prospectus agrees with the corresponding amounts
(after restatements where applicable) in the audited consolidated
financial statements for such five fiscal years which were included
or incorporated by reference in the Company's Annual Reports on Form
10-K for such fiscal years;
(v) They have compared the information in the
Prospectus under selected captions with the disclosure requirements
of Regulation S-K and on the basis of limited procedures specified
in such letter nothing came to their attention as a result of the
foregoing procedures that caused them to believe that this
information does not
conform in all material respects with the disclosure requirements of
Items 301, 302, 402 and 503(d), respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not
constituting an examination in accordance with generally accepted
auditing standards, consisting of a reading of the unaudited
financial statements and other information referred to below, a
reading of the latest available interim financial statements of the
Company and its subsidiaries, inspection of the minute books of the
Company and its subsidiaries since the date of the latest audited
financial statements included in the Prospectus, inquiries of
officials of the Company and its subsidiaries responsible for
financial and accounting matters and such other inquiries and
procedures as may be specified in such letter, nothing came to their
attention that caused them to believe that:
(A) (i) the unaudited consolidated statements of income,
consolidated balance sheets and consolidated statements of
cash flows included in the Prospectus do not comply as to
form in all material respects with the applicable
accounting requirements of the Act and the related
published rules and regulations, or (ii) any material
modifications should be made to the unaudited condensed
consolidated statements of income, consolidated balance
sheets and consolidated statements of cash flows included
in the Prospectus for them to be in conformity with
generally accepted accounting principles;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the
corresponding items in the unaudited consolidated financial
statements from which such data and items were derived, and
any such unaudited data and items were not determined on a
basis substantially consistent with the basis for the
corresponding amounts in the audited consolidated financial
statements included in the Prospectus;
(C) the unaudited financial statements which were not included
in the Prospectus but from which were derived any unaudited
condensed financial statements referred to in clause (A)
and any unaudited income statement data and balance sheet
items included in the Prospectus and referred to in clause
(B) were not determined on a basis substantially consistent
with the basis for the audited consolidated financial
statements included in the Prospectus;
(D) any unaudited pro forma consolidated condensed financial
statements included in the Prospectus do not comply as to
form in all material respects with the applicable
accounting requirements of the Act and the published rules
and regulations thereunder or the pro forma adjustments
have not been properly applied to the historical amounts in
the compilation of those statements;
(E) as of a specified date not more than five days prior to the
date of such letter, there have been any changes in the
consolidated capital stock (other than issuances of capital
stock upon exercise of options and stock appreciation
rights, upon earn-outs of performance shares and upon
conversions of convertible securities, in each case which
were outstanding on the date of the latest financial
statements included in the Prospectus) or any increase in
the consolidated long-term debt of the Company and its
subsidiaries, or any decreases in consolidated net current
assets or stockholders' equity or other items specified by
the Representatives, or any increases in any items
specified by the Representatives, in each case as compared
with amounts shown in the latest balance sheet included in
the Prospectus, except in each case for changes, increases
or decreases which the Prospectus discloses have occurred
or may occur or which are described in such letter; and
(F) for the period from the date of the latest financial
statements included in the Prospectus to the specified date
referred to in clause (E) there were any decreases in
consolidated net revenues or operating profit or the total
or per share amounts of consolidated net income or other
items specified by the Representatives, or any increases in
any items specified by the Representatives, in each case as
compared with the comparable period of the preceding year
and with any other period of corresponding length specified
by the Representatives, except in each case for decreases
or increases which the Prospectus discloses have occurred
or may occur or which are described in such letter; and
(vii) In addition to the examination referred to in
their report(s) included in the Prospectus and the limited
procedures, inspection of minute books, inquiries and other
procedures referred to in paragraphs (iii) and (vi) above, they have
carried out certain specified procedures, not constituting an
examination in accordance with generally accepted auditing
standards, with respect to certain amounts, percentages and
financial information specified by the Representatives, which are
derived from the general accounting records of the Company and its
subsidiaries, which appear in the Prospectus, or in Part II of, or
in exhibits and schedules to, the Registration Statement specified
by the Representatives, and have compared certain of such amounts,
percentages and financial information with the accounting records of
the Company and its subsidiaries and have found them to be in
agreement.
