IntercontinentalExchange, Inc.
Common Stock
--------------
Underwriting Agreement
July 17, 2006
Xxxxxxx, Xxxxx & Co.
Xxxxxx Xxxxxxx & Co. Incorporated
As representatives of the several Underwriters
named in Schedule I hereto (the "Representatives"),
c/o Goldman, Sachs & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
and
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
IntercontinentalExchange, Inc., 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 25,000 shares of common stock, par value $0.01 per share, of the Company
("Common Stock"). Certain shareholders of the Company named in Schedule II
hereto (the "Selling Shareholders") propose, subject to the terms and conditions
stated herein, severally and not jointly, to sell to the Underwriters an
aggregate of 7,975,000 shares of Common Stock, and, at the election of the
Underwriters, up to 1,200,000 additional shares of Common Stock. The aggregate
of 8,000,000 shares to be sold by the Company and the Selling Shareholders is
herein called the "Firm Shares" and the aggregate of 1,200,000 additional shares
to be sold by the Selling Shareholders is herein called the "Optional Shares".
The Firm Shares and the Optional Shares that the Underwriters elect to purchase
pursuant to Section 2 of this Agreement are herein collectively called the
"Shares".
It is understood and agreed that Xxxxxxx, Sachs & Co. and Xxxxxx Xxxxxxx &
Co. Incorporated are joint book runners for the offering and any determination
or other actions to be made under this Agreement by the Representatives shall
require the concurrence of both Xxxxxxx, Sachs & Co. and Xxxxxx Xxxxxxx & Co.
Incorporated.
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. 333-135060) (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 amendment thereto, each in
the form heretofore delivered to you, and, excluding exhibits thereto,
delivered 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
Preliminary Prospectus relating to the Shares that was included in the
Registration Statement immediately prior to the Applicable Time (as defined
in Section 1(a)(iii) hereof) is hereinafter called the "Pricing
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 6(a) of this Agreement 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, each 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"; such final prospectus, in the form first filed pursuant to Rule
424(b) under the Act, is hereinafter called the "Prospectus"); and any
"issuer free writing prospectus" as defined in Rule 433 under the Act
relating to the Shares is hereinafter called an "Issuer Free Writing
Prospectus";
(ii) No order preventing or suspending the use of the Pricing
Prospectus, dated July 14, 2006, or any Preliminary Prospectus dated
subsequent thereto or any Issuer Free Writing Prospectus, has been issued
by the Commission, and each such 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, Sachs & Co. and Xxxxxx Xxxxxxx & Co.
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Incorporated expressly for use therein or by a Selling Shareholder
expressly for use therein;
(iii) For the purposes of this Agreement, the "Applicable Time" is
6:00 p.m. (Eastern time) on the date of this Agreement; the Pricing
Prospectus, as of the Applicable Time, did not include any 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, not misleading; and each Issuer Free Writing Prospectus
listed on Schedule IV hereto does not conflict with the information
contained in the Registration Statement, the Pricing Prospectus or the
Prospectus and each Issuer Free Writing Prospectus, as supplemented by and
taken together with the Pricing Prospectus as of the Applicable Time, did
not include any 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, not misleading;
provided, however, that this representation and warranty shall not apply to
statements or omissions made in an Issuer Free Writing Prospectus in
reliance upon and in conformity with information furnished in writing to
the Company by any Underwriter through Xxxxxxx, Sachs & Co. and Xxxxxx
Xxxxxxx & Co. Incorporated expressly for use therein;
(iv) The Registration Statement conforms, and any further amendment to
the Registration Statement will conform, as of the applicable effective
date, 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 each part of the Registration
Statement, 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; the Prospectus conforms, and any further
amendments or supplements to the Prospectus will conform, as of the
applicable filing date, 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 filing date, contain an untrue statement
of a material fact or omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which
they were made, not misleading; 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, Sachs & Co. and Xxxxxx
Xxxxxxx & Co. Incorporated expressly for use therein or by a Selling
Shareholder expressly for use therein;
(v) Otherwise than as set forth or contemplated in the Pricing
Prospectus, (A) neither the Company nor any of its subsidiaries has, since
the date of the latest audited financial statements included in the Pricing
Prospectus, sustained 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; or incurred any material liability or
3
obligation, direct or contingent, or entered into any material transaction
not in the ordinary course of business; and (B) since the respective dates
as of which information is given in the Registration Statement and the
Pricing Prospectus, there has not been any change in the capital stock,
short-term debt or long-term debt of the Company or any of its subsidiaries
that is material to the Company and its subsidiaries, taken as a whole, or
any material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs, management,
business, financial position, stockholders' equity or results of operations
of the Company and its subsidiaries, taken as a whole;
(vi) The Company and each of its subsidiaries have good and marketable
title in fee simple to, or have valid rights to lease or otherwise use, all
items of real and personal property owned or leased by them, in each case
free and clear of all liens, encumbrances, equities, claims and title
defects (collectively, "Liens") that would reasonably be expected to have,
individually or in the aggregate, a material adverse effect on the current
or future consolidated financial position, business, stockholders' equity
or results of operations of the Company and its subsidiaries, taken as a
whole (a "Material Adverse Effect"), except as set forth or contemplated in
the Pricing Prospectus; and any real property and buildings held under
lease by the Company and its subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as would not
reasonably be expected to have, singularly or in the aggregate, a Material
Adverse Effect and do not materially interfere with the use made and
proposed to be made of such property and buildings by the Company and its
subsidiaries;
(vii) 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 Pricing 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 so as to require such
qualification, except where the failure to so qualify would not reasonably
be expected to have, individually or in the aggregate, a Material Adverse
Effect; and each significant subsidiary of the Company as defined in Rule
1-02 of Regulation S-X (the "Significant Subsidiaries") has been duly
incorporated or organized and is validly existing in good standing (if
applicable) under the laws of its jurisdiction of incorporation or
organization;
(viii) The Company has an authorized capitalization as set forth in
the Pricing Prospectus, and all of the issued shares of capital stock of
the Company have been duly and validly authorized and issued, are fully
paid and non-assessable and conform to the description of the capital stock
contained in the Pricing Prospectus; and all of the issued shares of
capital stock of each subsidiary of the Company except ICE Futures Holdings
Plc ("ICE Futures") have been duly and validly authorized and issued, are
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 except as set forth in the Pricing Prospectus; all of the
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issued shares of capital stock of ICE Futures (the "ICE Futures Stock")
have been duly and validly authorized and issued and are fully paid and
non-assessable, and, except as set forth in the Pricing Prospectus, the
Company owns its shares of the ICE Futures Stock free and clear of all
Liens; the holders of outstanding shares of capital stock of the Company
are not entitled to preemptive or other rights to acquire from the Company
the Shares or any other shares of capital stock of the Company, except as
set forth in the Pricing Prospectus; and there are no outstanding
securities convertible into or exchangeable for, or warrants, rights or
options to purchase from the Company, or obligations of the Company to
issue, shares of Common Stock or any other class of shares or other equity
or ownership interest of the Company, except as set forth or contemplated
in the Pricing Prospectus;
(ix) The Shares 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 in all
material respects to the description of the Common Stock contained in the
Prospectus;
(x) This Agreement has been duly authorized, executed and delivered by
the Company and constitutes a valid and legally binding agreement of the
Company, enforceable against the Company in accordance with its terms,
except as the same may be limited by applicable bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and other similar laws
affecting creditors' rights and remedies generally and by general equitable
principles (whether considered in a proceeding in equity or at law), and
except to the extent that rights to indemnity or contribution under this
Agreement may be limited by applicable law;
(xi) The issue and sale of the Shares to be sold by the Company and
the compliance by the Company with all of the provisions of this Agreement
and the consummation by the Company of the transactions herein
contemplated, will not (A) conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute a default under, 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 the Company or any of its subsidiaries is bound or to which any of
the property or assets of the Company or any of its subsidiaries is
subject, (B) result in any violation of the provisions of the certificate
of incorporation or by-laws of the Company as in effect on the date hereof
or (C) result in any violation of any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction
over the Company or any of its subsidiaries or any of their properties,
except, in the case of clause (A) or (C), as would not, individually or in
the aggregate, have a Material Adverse Effect; and no consent, approval,
authorization, order, registration or qualification of or with any such
court or governmental agency or body is required for the issue and sale of
the Shares to be sold by the Company 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,
5
approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws or by the rules and
regulations of the NASD in connection with the purchase and distribution of
the Shares by the Underwriters;
(xii) Neither the Company nor any of its Significant Subsidiaries (A)
is in violation of its charter or by-laws (or other organizational
document), (B) is in default in any respect, and no event has occurred
which, with notice or lapse of time or both, would constitute such a
default, in the due performance or observance of any term, covenant or
condition contained in any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which it is a party or by
which it is bound or to which any of its properties or assets are subject
or (C) is in violation in any respect of any law, ordinance, governmental
rule, regulation or court decree to which it or its properties or assets is
subject, except in the case of clause (B) or (C) as may be set forth or
contemplated in the Prospectus or as would not reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect;
(xiii) Except as set forth or contemplated in the Pricing Prospectus,
there are no contracts, agreements or understandings between the Company
and any person granting such person the right to require the Company to
file a registration statement under the Act with respect to any securities
of the Company or to require the Company to register any securities with
the Shares pursuant to the Registration Statement;
(xiv) The statements set forth in the Pricing Prospectus under the
caption "Description of Capital Stock", insofar as they purport to
constitute a summary of the terms of the Common Stock, under the caption
"Underwriting", insofar as they purport to describe the provisions of this
Agreement and the lockup agreements described in Annex IV hereto, and under
the caption "Certain United States Tax Consequences to Non-U.S. Holders of
Common Stock", insofar as they purport to describe the provisions of the
laws and tax consequences referred to therein, are accurate, complete and
fair in all material respects;
(xv) Other than as set forth or contemplated in the Pricing
Prospectus, there are no legal or governmental proceedings pending to which
the Company or any of its subsidiaries is a party or of which any of the
properties or assets of the Company or any of its subsidiaries is the
subject which would reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect; and, to the knowledge of the Company,
no such proceedings are threatened by governmental authorities or by others
other than as set forth or contemplated in the Prospectus
(xvi) The Company was not, at the time of the filing of the Initial
Registration Statement, and is not an "ineligible issuer"' as defined in
Rule 405 under the Act;
(xvii) None of the Company or any of its subsidiaries is or, upon the
consummation of the issuance and sale of the Shares and the application of
the
6
proceeds therefrom will be, required to register as an "investment company"
within the meaning of the Investment Company Act of 1940, as amended (the
"Investment Company Act"), and the rules and regulations of the Commission
thereunder;
(xviii) Ernst & Young LLP, who have certified certain consolidated
financial statements of the Company and its subsidiaries, are independent
public accountants with respect to the Company and its subsidiaries, as
required by the Act and the rules and regulations thereunder. The
consolidated financial statements of the Company and its consolidated
subsidiaries included in the Registration Statement and the Prospectus have
been prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods covered thereby, and together
with the related schedules and notes, present fairly in all material
respects the financial position of the Company and its consolidated
subsidiaries at the respective dates indicated and the results of the
operations, stockholders' equity and cash flows of the Company and its
consolidated subsidiaries for the respective periods specified; the
selected financial data and the summary financial information included in
the Prospectus present fairly in all material respects the information
shown therein and have been compiled on a basis consistent with that of the
audited financial statements included in the Registration Statement;
(xix) Except as set forth or contemplated in the Pricing Prospectus,
(A) the Company and its subsidiaries own or possess adequate rights to use
all patents, patent applications, trademarks, service marks, trade names,
trademark registrations, service xxxx registrations, copyrights, licenses
and know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures) necessary for the conduct of their respective businesses as
presently conducted ("Intellectual Property"), except where the failure to
own or possess any such Intellectual Property would not reasonably be
expected to have, individually or in the aggregate, a Material Adverse
Effect, (B) neither the Company nor any of its subsidiaries has received
any notice of infringement of or conflict with asserted rights of others
with respect to any of the foregoing that is still outstanding which, if
the subject of an unfavorable decision, ruling or finding, would reasonably
be expected to have, individually or in the aggregate, a Material Adverse
Effect, and (C) the Company owns or has obtained licenses for all
Intellectual Property described in the Pricing Prospectus as being owned or
licensed to the Company, except to the extent that the failure to own any
such Intellectual Property or obtain any such license would not reasonably
be expected to have, individually or in the aggregate, a Material Adverse
Effect;
(xx) Except as set forth or contemplated in the Pricing Prospectus,
there is no claim pending or, to the knowledge of the Company, threatened
under any Environmental Law (as defined below) against the Company or any
of its subsidiaries that would reasonably be expected to have, individually
or in the aggregate, a Material Adverse Effect, and there are no past or
present actions or
7
conditions which are, individually or in the aggregate, reasonably likely
to form the basis of any such claim under existing Environmental Law
against the Company or any of its subsidiaries that would, singularly or in
the aggregate, reasonably be expected to have a Material Adverse Effect.
The term "Environmental Law" means any federal, local or foreign law,
regulation, ordinance, order, judgment, decree, permit or rule (including
rule of common law) now in effect governing pollution, protection of the
environment or injury or property damage arising from the presence of, or
actual or alleged exposure to, hazardous or toxic materials, substances or
wastes, including but not limited to, asbestos or asbestos-containing
materials;
(xxi) The Company and its subsidiaries have insurance covering their
respective properties, operations, personnel and businesses, which
insurance is in amounts and insures against such losses and risks, in each
case as in accordance with customary industry practice, except where the
failure to maintain such insurance would not reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect;
(xxii) Except as otherwise set forth or contemplated in the Pricing
Prospectus, each of the Company and its subsidiaries possesses all material
licenses, certificates, authorizations and permits issued by, and has made
all declarations and filings with, the appropriate federal, state or
foreign regulatory agencies or bodies which are necessary for the ownership
of its properties or the conduct of its businesses as presently conducted
and as described in the Prospectus, except where the failure to possess or
make the same would not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect, and none of the Company or its
subsidiaries have received notification of any revocation or modification
of any such license, certificate, authorization or permit that would
reasonably be expected to have, singularly or in the aggregate, a Material
Adverse Effect or have any reason to believe that any such license,
certificate, authorization or permit will not be renewed;
(xxiii) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurance that in all material respects
(A) transactions are executed in accordance with management's general or
specific authorizations, (B) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability, (C)
access to assets is permitted only in accordance with management's general
or specific authorization, and (D) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(xxiv) The Company is in compliance in all material respects with all
provisions of the Xxxxxxxx-Xxxxx Act of 2002 that are effective and
applicable to the Company as of the date hereof and expects to be in
compliance with all additional provisions of the Xxxxxxxx-Xxxxx Act of 2002
that will become
8
applicable to it, including those provisions relating to internal control
over financial reporting, when such provisions become applicable to the
Company.
(xxv) The Shares have been approved for listing on the New York Stock
Exchange, Inc. (the "Exchange");
(xxvi) None of the Company or its subsidiaries has taken or will take,
and to the best knowledge of the Company, none of its directors or officers
has taken or will take, directly or indirectly, any action in connection
with the distribution of the Shares contemplated hereby which is designed
to or which constitutes or which might reasonably be expected to cause or
result in unlawful stabilization or manipulation of the price of any
security of the Company or its subsidiaries in order to facilitate the sale
or resale of the Shares;
(xxvii) The ICE Futures Entities (as defined in 9(e) of this
Agreement) are the only Significant Subsidiaries of the Company;
(b) Each of the Selling Shareholders, severally and not jointly,
represents and warrants to, and agrees with, each of the Underwriters and the
Company that:
(i) No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body is
required to be obtained by such Selling Shareholder for the sale of the
Shares by such Selling Shareholder, or the execution and delivery by such
Selling Shareholder of this Agreement, the Power of Attorney (as defined
below) and the Custody Agreement hereinafter referred to, other than the
Commission declaring the Registration Statement effective (and no
representation is made with respect to state securities or Blue Sky laws or
NASD review of the offering); such Selling Shareholder has full right,
power and authority to sell, assign, transfer and deliver the Shares to be
sold by such Selling Shareholder hereunder; and each of this Agreement, the
Power of Attorney and the Custody Agreement have been duly authorized,
executed and delivered by such Selling Shareholder and constitutes a valid
and legally binding agreement of such Selling Shareholder, enforceable
against such Selling Shareholder in accordance with its terms, except as
the same may be limited by applicable bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and other similar laws affecting
creditors' rights and remedies generally and by general equitable
principles (whether considered in a proceeding in equity or at law), and
except to the extent that rights to indemnity or contribution under this
Agreement may be limited by applicable law;
(ii) The sale of the Shares by such Selling Shareholder hereunder and
such Selling Shareholder's compliance with all of the provisions of this
Agreement, the Power of Attorney and the Custody Agreement and the
consummation of the transactions herein and therein contemplated for such
Selling Shareholder will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which such Selling Shareholder is a party or by
which such Selling Shareholder is
9
bound or to which any of the property or assets of such Selling Shareholder
is subject, except for breaches, violations or defaults that would not
adversely affect such Selling Shareholder's ability to fulfill its
obligations under this Agreement, the Power of Attorney or the Custody
Agreement in any material respect, nor will such action result in any
violation of the provisions of the organizational documents of such Selling
Shareholder if such Selling Shareholder is not an individual or any statute
or any order, rule or regulation of any court or governmental agency or
body having jurisdiction over such Selling Shareholder or any of such
Selling Shareholder's properties;
(iii) Immediately prior to each Time of Delivery (as defined in
Section 4 of this Agreement), the Selling Shareholder will be the
registered owner of the Shares to be sold by such Selling Shareholder
hereunder, free and clear of all Liens, and upon payment for the Shares to
be sold by such Selling Shareholders as provided in this Agreement,
delivery of such Shares, as directed by the Underwriters, to Cede & Co.
("Cede") or such other nominee as may be designated by DTC, registration of
such shares in the name of Cede or such other nominee and the crediting of
such Shares on the records of DTC to securities accounts of the
Underwriters, (i) DTC shall be a "protected purchaser" of such Shares
within the meaning of Section 8-303 of the UCC, (ii) under Section 8-501 of
the UCC, the Underwriters will acquire a valid security entitlement in
respect of such Shares and (iii) assuming that each Underwriter does not
have "notice of an adverse claim" (within the meaning of Section 8-105 of
the UCC) to such Shares, no action based on any "adverse claim" (within the
meaning of Section 8-102 of the UCC) to such Shares may be asserted against
the Underwriters with respect to such security entitlement.
(iv) Such Selling Shareholder, in its capacity as a Selling
Shareholder, has not taken and will not take, directly or indirectly, any
action which is designed to or which constitutes or which might reasonably
be expected to cause or result in stabilization or manipulation of the
price of any security of the Company in order to facilitate the sale or
resale of the Shares;
(v) 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 such Selling
Shareholder expressly for use therein, which information consists solely of
the information which relates to such Selling Shareholder set forth in the
Registration Statement and Prospectus under the caption "Principal and
Selling Shareholders", such Registration Statement, Preliminary Prospectus,
the Prospectus and any further amendments or supplements thereto, in each
case as of the effective date or date of filing with the Commission, as the
case may be, conformed or will conform, as the case may be, in all material
respects to the requirements of the Act and the rules and regulations of
the Commission thereunder and did not or will not, as the case may be,
contain any untrue statement of a material fact or omit to state any
10
material fact required to be stated therein or necessary to make the
statements therein not misleading;
(vi) 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, such Selling Shareholder will deliver to you prior to or at
the First Time of Delivery (as defined in Section 4(a) of this Agreement) 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);
(vii) Such Selling Shareholder has duly executed and delivered a Power
of Attorney, in the form heretofore furnished to you (the "Power of
Attorney"), appointing the persons indicated in Schedule II hereto, and
each of them, as such Selling Shareholder's attorneys-in-fact (the
"Attorneys-in-Fact") with authority to execute and deliver this Agreement
on behalf of such Selling Shareholder, to determine the purchase price to
be paid by the Underwriters to the Selling Shareholders as provided in
Section 2 of this Agreement, to authorize the delivery of the Shares to be
sold by such Selling Shareholder hereunder and otherwise to act on behalf
of such Selling Shareholder in connection with the transactions
contemplated by this Agreement and the Custody Agreement; and
(viii) The appointment by such Selling Shareholder of the
Attorneys-in-Fact by the Power of Attorney, are to the extent stated
therein irrevocable; the obligations of the Selling Shareholders hereunder
shall not be terminated by operation of law, whether by the death or
incapacity of any Selling Shareholder or, in the case of an estate or
trust, by the death or incapacity of any executor or trustee or the
termination of such estate or trust, or in the case of a partnership or
corporation, by the dissolution of such partnership or corporation, or by
the occurrence of any other event; if any Selling Shareholder or any such
executor or trustee should die or become incapacitated, or if any such
estate or trust should be terminated, or if any such partnership or
corporation should be dissolved, or if any other such event should occur,
before the delivery of the Shares hereunder, the Shares shall be delivered
by or on behalf of the Selling Shareholders in accordance with the terms
and conditions of this Agreement and of the Custody Agreement; and actions
taken by the Attorneys-in-Fact pursuant to the Powers of Attorney shall be
as valid as if such death, incapacity, termination, dissolution or other
event had not occurred, regardless of whether or not the Custodian (as
defined in the Custody Agreement) or any Attorney-in-Fact or any of them
shall have received notice of such death, incapacity, termination,
dissolution or other event.
2. Subject to the terms and conditions herein set forth, (a) the
Company and each of the Selling Shareholders agree, severally and not jointly,
to issue and sell to each of the Underwriters, and each of the Underwriters
agrees, severally and not jointly, to purchase from the Company and each of the
Selling Shareholders, at a purchase price per share of $53.84, 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
11
sold by the Company or such Selling Shareholder, as the case may be, as set
forth opposite its 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 all of the Selling Shareholders
hereunder and (b) in the event and to the extent that the Underwriters shall
exercise the election to purchase Optional Shares as provided below, each of the
Selling Shareholders agrees, severally and not jointly, to sell to each of the
Underwriters, and each of the Underwriters agrees, severally and not jointly, to
purchase from each of the Selling Shareholders, at the purchase price per share
set forth in clause (a) of this Section 2, that portion of the number of
Optional Shares set forth opposite such Selling Shareholder's name in Schedule
II hereto as to which such election shall have been exercised (to be adjusted by
you so as to eliminate fractional shares) determined by (x) 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 and (y) multiplying the product
by a fraction, the numerator of which is the maximum number of Optional Shares
to be sold by such Selling Shareholder set forth opposite the name of such
Selling Shareholder in Schedule II hereto and the denominator of which is the
maximum number of Optional Shares to be sold by all of the Selling Shareholders
hereunder.
The Selling Shareholders, as and to the extent indicated in Schedule II
hereto, hereby grant, severally and not jointly, to the Underwriters the right
to purchase at their election up to 1,200,000 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 shall be made in proportion to the number
of Optional Shares to be sold by each Selling Shareholder as set forth in
Schedule II hereto. Any such election to purchase Optional Shares may be
exercised only by written notice from you to the Attorneys-in-Fact, given within
a period of 30 calendar days after the date of this Agreement, 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 of this
Agreement) or, unless you and the Attorneys-in-Fact 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 such
authorized denominations and registered in such names as the Representatives may
request upon at least forty-eight hours' prior notice to the Company and the
Selling Shareholders shall be delivered by or on behalf of the Company and the
Selling Shareholders to the Representatives, through the facilities of the
Depository Trust
12
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 account specified by the Company and each of the
Selling Shareholders, as their interest may appear, to the Representatives at
least forty-eight hours in advance. 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 July 21, 2006 or such other time and date as the Representatives and
the Company may agree upon in writing, and, with respect to the Optional Shares,
9:30 a.m., New York time, on the date specified by the Representatives in the
written notice given by them of the Underwriters' election to purchase such
Optional Shares, or such other time and date as they and the Selling
Shareholders 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".
(b) The documents to be delivered at each Time of Delivery by or on
behalf of the parties hereto pursuant to Section 9 of this Agreement, including
the cross receipt for the Shares and any additional documents requested by the
Underwriters pursuant to Section 8(m) of this Agreement, will be delivered at
the offices of Xxxxxxxx & Xxxxxxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 (the "Closing Location"), and the Shares will be delivered at such Time of
Delivery. A meeting will be held at the Closing Location at 3:00 p.m., New York
time, on the New York Business Day next preceding such 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 5, "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 provide you with as many
signed copies of the Registration Statement and each amendment thereto as you
may request; 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 with
copies thereof; to file promptly all material required to be filed by the
Company with the Commission pursuant to Rule 433(d) under the Act; 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 other prospectus in respect of the Shares, of the
suspension of the qualification of the Shares for offering
13
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 other
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, to subject itself to taxation or
to file a general consent to service of process in any jurisdiction;
(c) As soon as practicable on the New York Business Day next succeeding
the date of this Agreement and from time to time, to furnish the Underwriters
with written and electronic copies of the Prospectus in New York City in such
quantities as you may reasonably request, and, if the delivery of a prospectus
(or in lieu thereof, the notice referred to in Rule 173(a) of the Act) 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 event 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 (or in lieu thereof, the notice referred to in Rule
173(a) of the Act) 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,
file with the Commission and furnish without charge to each Underwriter and to
any dealer in securities as many written and electronic 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 (or
in lieu thereof, the notice referred to in Rule 173(a) of the Act) 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 written and
electronic 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
thereunder (including, at the option of the Company, Rule 158);
14
(e) During the period beginning from the date of this Agreement and
continuing to and including the date that is 90 days after the date of the
Prospectus (the initial "Lock-Up Period"), not to (i) offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase, lend, or
otherwise transfer or dispose of, directly or indirectly any shares of Common
Stock of the Company, any securities that are convertible into or exchangeable
for shares of Common Stock, or that represent the right to receive, Common Stock
or any other securities that are substantially similar to the Shares or (ii)
enter into any swap or other arrangement that transfers to another, in whole or
in part, any of the economic consequences of ownership of the shares of Common
Stock of the Company, whether any such transaction described in clause (i) or
(ii) above is to be settled by delivery of Common Stock of the Company or such
other securities, in cash or otherwise, or (iii) file any registration statement
with the SEC relating to the offering of any Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock, without the
prior written consent of the Representatives; provided, however, that if (1)
during the last 17 days of the initial Lock-Up Period, the Company releases
earnings results or announces material news or a material event or (2) prior to
the expiration of the initial Lock-Up Period, the Company announces that it will
release earnings results during the 15-day period following the last day of the
initial Lock-Up Period, then in each case the Lock-Up Period will be
automatically extended until the expiration of the 18-day period beginning on
the date of release of the earnings results or the announcement of the material
news or material event, as applicable, unless the Representatives waive, in
writing, such extension. The Company will provide the Representatives and each
shareholder subject to the Lock-Up Period pursuant to the lockup letters
described in Section 8(k) with prior notice of any such announcement that gives
rise to an extension of the Lock-Up Period. The foregoing shall not apply to (A)
the Firm Shares and the Optional Shares; (B) the issuance by the Company of
shares of, options for, or rights convertible into, Common Stock pursuant to any
of the Company's stock option plans, equity incentive plans or restricted stock
plans, each as in effect on the date of this Agreement; (C) the issuance by the
Company of shares of Common Stock pursuant to the conversion or exchange of
convertible or exchangeable securities outstanding as of the date of this
Agreement; (D) the issuance by the Company of shares of Common Stock pursuant to
the exercise of options or warrants or the conversion of restricted stock unit
awards outstanding as of the date of this Agreement; or (E) the ability of the
Company to issue shares of Common Stock to holders of its Class A Common Stock
Series 2 upon the exercise of the right of such holders to convert such shares
into shares of Common Stock;
(f) To make generally available 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;
15
(g) During a period of two 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, except that any
reports or communications filed with the Commission and available through the
Commission's Electronic Data Gathering, Analysis and Retrieval (XXXXX) system
need not be provided, and to deliver to you 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;
(h) To use the net proceeds received by it from the sale by the Company
of the Shares pursuant to this Agreement as contemplated in the Prospectus under
the caption "Use of Proceeds", provided that the Company may change its plans
regarding the use of proceeds as contemplated in the Prospectus;
(i) Not to (and to use its best efforts to cause its affiliates not to)
take, directly or indirectly, any action in connection with the distribution of
the Shares contemplated hereby which is designed to or which constitutes or
which might reasonably be expected to cause or result in unlawful stabilization
or manipulation of the price of any security of the Company or its subsidiaries
in order to facilitate the sale or resale of the Shares;
(j) To use its best efforts to list, subject to notice of issuance, the
Shares on the New York Stock Exchange (the "Exchange");
(k) If the Company elects to rely upon Rule 462(b), to 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 at the
time of filing, to 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; and
(l) Upon request of any Underwriter, to furnish, or cause to be
furnished, to such Underwriter an electronic version of the Company's
trademarks, servicemarks and corporate logo for use on the website, if any,
operated by such Underwriter for the purpose of facilitating the on-line
offering of the Shares in accordance with applicable law (the "License");
provided, however, that the License shall be used solely for the purpose
described above, is granted without any fee and may not be assigned or
transferred.
6. (a) The Company and each of the Selling Shareholders represents and
agrees that, without the prior consent of Xxxxxxx, Sachs & Co. and Xxxxxx
Xxxxxxx & Co. Incorporated, it has not made and will not make any offer relating
to the Shares that would constitute a "free writing prospectus" as defined in
Rule 405 under the Act; each Underwriter represents and agrees that, without the
prior consent of the Company and Xxxxxxx, Sachs & Co. and Xxxxxx Xxxxxxx & Co.
Incorporated, it has not made and will not make any offer relating to the Shares
that would constitute a free writing prospectus; any such free writing
prospectus the use of which has been consented to by the Company
16
and Xxxxxxx, Sachs & Co. and Xxxxxx Xxxxxxx & Co. Incorporated is listed on
Schedule IV(a) hereto;
(b) The Company has complied and will comply with the
requirements of Rule 433 under the Act applicable to any Issuer Free Writing
Prospectus, including timely filing with the Commission or retention where
required and legending;
(c) The Company agrees that if at any time following issuance of an
Issuer Free Writing Prospectus any event occurred or occurs as a result of which
such Issuer Free Writing Prospectus would conflict with the information in the
Registration Statement, the Pricing Prospectus or the Prospectus or 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 then prevailing, not misleading, the Company will give prompt
notice thereof to Xxxxxxx, Sachs & Co. and Xxxxxx Xxxxxxx & Co. Incorporated
and, if requested by Xxxxxxx, Sachs & Co. and Xxxxxx Xxxxxxx & Co. Incorporated,
will prepare and furnish without charge to each Underwriter an Issuer Free
Writing Prospectus or other document which will correct such conflict, statement
or omission; provided, however, that this representation and warranty shall not
apply to any statements or omissions in an Issuer Free Writing Prospectus made
in reliance upon and in conformity with information furnished in writing to the
Company by an Underwriter through Xxxxxxx, Sachs & Co. and Xxxxxx Xxxxxxx & Co.
Incorporated expressly for use therein.
7. Whether or not the transactions contemplated in this Agreement are
consummated or this Agreement is terminated, the Company and each of the Selling
Shareholders 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 in
connection with the registration of the Shares under the Act and all other
expenses of the Company in connection with the preparation, printing and filing
of the Registration Statement, any Preliminary Prospectus, any Issuer Free
Writing Prospectus and the Prospectus and amendments and supplements thereto and
the mailing and delivering of copies thereof to the Underwriters and dealers;
(ii) the cost of printing or producing any Agreement among Underwriters, this
Agreement, any Blue Sky Memorandum, closing documents (including any
compilations thereof) and any other documents in connection with the offering,
purchase, sale and delivery of the Shares; (iii) all expenses in connection with
the qualification of the Shares for offering and sale under state securities
laws as provided in Section 5(b) of this Agreement, including the reasonable
fees and disbursements of counsel for the Underwriters in connection with such
qualification and in connection with any Blue Sky survey (not to exceed
$10,000); (iv) all fees and expenses in connection with listing the Shares on
the Exchange; (v) the filing fees incident to, and the reasonable fees and
disbursements of counsel for the Underwriters in connection with, securing any
required review by the NASD of the terms of the sale of the Shares; (vi) the
cost of preparing stock certificates; (vii) the cost and charges of any transfer
agent or registrar; (viii) the costs and expenses of the Company relating to
investor presentations on any "road show" undertaken in connection with the
marketing of the offering of the Shares, including, without limitation, expenses
associated with the production of road show
17
slides and graphics, fees and expenses of any consultants engaged by the Company
in connection with the road show presentations, travel and lodging expenses of
the representatives and officers of the Company and any such consultants, and
the cost of any aircraft chartered in connection with the road show; (ix) the
Selling Shareholder's share of the fees and expenses of the Attorneys-in-Fact
and the Custodian, up to an aggregate amount not to exceed $10,000; and all
other costs and expenses incident to the performance of its obligations
hereunder which are not otherwise specifically provided for in this Section;
(b) Such Selling Shareholder will pay or cause to be paid all
costs and expenses incident to the performance of such Selling Shareholder's
obligations hereunder which are not otherwise specifically provided for in this
Section, including (i) any fees and expenses of counsel for such Selling
Shareholder, (ii) such Selling Shareholder's pro rata share of the fees and
expenses of the Attorneys-in-Fact and the Custodian to the extent such fees in
the aggregate exceed $10,000, and (iii) all expenses and taxes incident to the
sale and delivery of the Shares to be sold by such Selling Shareholder to the
Underwriters hereunder. In connection with clause (b)(iii) of the preceding
sentence, the Representatives agree to pay New York State stock transfer tax,
and the Selling Shareholder agrees to reimburse the Representatives 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 the Company shall bear, and the Selling Shareholders shall not be
required to pay or to reimburse the Company for, the cost of any other matters
not directly relating to the sale and purchase of the Shares pursuant to this
Agreement; and
(c) Except as provided in subsections (a) and (b) above, and
Sections 9, 10 and 12 of this Agreement, 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.
8. The respective obligations of the Underwriters, 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 the Selling Shareholders herein are, at and as of such Time of
Delivery, true and correct, the condition that the Company and the Selling
Shareholders shall have performed all of its and their respective obligations
hereunder to be performed prior to the Time of Delivery and the following
additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant
to Rule 424(b) under the Act within the applicable time period prescribed for
such filing by the rules and regulations under the Act and in accordance with
Section 6(a) of this Agreement; all material required to be filed by the Company
pursuant to Rule 433(d) under the Act shall have been filed with the Commission
within the applicable time period required for such filing by Rule 433; if the
Company has elected to rely upon Rule 462(b) under the Act, 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
18
been issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; no stop order suspending or preventing the use of
the Prospectus or any Issuer Free Writing Prospectus 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 Xxxxxxxx Xxxxx & Xxxxxxxx LLP, counsel for the Underwriters,
shall have furnished to you their written opinion or opinions, dated such Time
of Delivery, with respect to such matters as you may reasonably request, in form
and substance reasonably satisfactory to you, and such counsel shall have
received such papers and information as they may request to enable them to pass
upon such matters;
(c) Xxxxxxxx & Xxxxxxxx LLP, counsel for the Company, shall have
furnished to you their written opinion (a draft of such opinion is attached as
Annex III (a) hereto), dated such Time of Delivery, in form and substance
reasonably satisfactory to you, to the effect that:
(i) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware, with
all requisite corporate power and authority to own its properties and
conduct its business as described in the Prospectus;
(ii) The Company's Fourth Amended and Restated Certificate of
Incorporation authorizes the issuance of up to three hundred million shares
of capital stock. All outstanding shares of the Company's Common Stock,
including the Shares, have been duly authorized and validly issued and are
fully paid and nonassessable;
(iii) This Agreement has been duly authorized, executed and delivered
by the Company;
(iv) The issuance of the Shares and the sale of the Shares by the
Company to the Underwriters pursuant to this Agreement and the performance
by the Company of its obligations under this Agreement will not (A) violate
the Fourth Amended and Restated Certificate of Incorporation or Bylaws of
the Company, (B) result in a default under or breach of the agreements
listed on Annex A to such opinion filed as exhibits to the Company's
Registration Statement (File No. 333-135060), or (C) violate any Federal
law of the United States or law of the State of New York, or the General
Corporation Law of the State of Delaware, in each case applicable to the
Company; provided, however, that for purposes of this paragraph (iv), such
counsel need not express any opinion with respect to Federal or state
securities laws, other antifraud laws, fraudulent transfer laws, antitrust
and commodities laws or the Employee Retirement Income Security Act of 1974
and related laws, or as to bankruptcy, insolvency, reorganization,
moratorium and similar laws of general applicability relating to or
affecting creditors' rights or to general equity principles, or as to
validity or enforceability of this Agreement;
19
(v) All regulatory consents, authorizations, approvals and filings
required to be obtained or made by the Company under the Federal laws of
the United States, the laws of the State of New York and the General
Corporation Law of the State of Delaware for the issuance, sale and
delivery of Shares of the Company to the Underwriters have been obtained or
made;
(vi) The Company is not, and after giving effect to the offering and
sale of the Shares and the application of proceeds therefrom will not be,
an "investment company," as such term is defined in the Investment Company
Act of 1940; and
(vii) In rendering the opinions, such counsel may state that they
express no opinion as to the laws of any jurisdiction other than the
Federal laws of the United States, the laws of the State of New York and
the General Corporation Law of the State of Delaware. Such counsel may also
state that they have relied as to certain matters upon information obtained
from officers of the Company and its subsidiaries, public officials and
other sources believed by such counsel to be responsible.
Such counsel shall also furnish you with a letter to the effect that,
as counsel to the Company, they have reviewed the Registration Statement,
the Pricing Prospectus and the Prospectus, participated in discussions with
your representatives and those of the Company and its accountants and
advised the Company as to the requirements of the Act and the applicable
rules and regulations thereunder; between the date of the Prospectus and
such Time of Delivery, such counsel participated in further discussions
with your representatives and those of the Company and its accountants in
which the contents of certain portions of the Prospectus and related
matters were discussed and reviewed certificates of certain officers of the
Company, an opinion addressed to you from Xxxxxxxxx X. Short, Esq. and
Xxxxxxx Xxxxx and letters addressed to you from the Company's independent
accountants; on the basis of the information that such counsel gained in
the course of the performance of the services referred to above, considered
in the light of such counsel's understanding of the applicable law and the
experience such counsel have gained through their practice under the Act,
they will confirm to you that, in such counsel's opinion, the Registration
Statement as of the effective date of the Registration Statement, and the
Prospectus as of the date of the Prospectus, appeared on their face to be
appropriately responsive in all material respects to the requirements of
the Act and the applicable rules and regulations of the Commission
thereunder; nothing that came to such counsel's attention in the course of
such review has caused such counsel to believe that (i) the Registration
Statement, as of its effective date, contained any untrue statement of a
material fact or omitted to state any material fact required to be stated
therein or necessary to make the statements therein not misleading; (ii)
the Pricing Prospectus, as of the Applicable Time, when considered together
with the price to the public for the Shares set forth on the cover of the
Prospectus, contained any untrue statement of a material fact or omitted to
state any material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
20
misleading; or (iii) the Prospectus, as of its date, contained any untrue
statement of a material fact or omitted to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; nothing that came
to the attention of such counsel in the course of the procedures described
in the second clause of this paragraph has caused such counsel to believe
that the Prospectus, as it may be amended or supplemented, as of such Time
of Delivery, contained any untrue statement of a material fact or omitted
to state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; such counsel may state that the limitations inherent in the
independent verification of factual matters and the character of
determinations involved in the registration process are such that such
counsel does not assume any responsibility for the accuracy, completeness
or fairness of the statements contained in the Registration Statement or
the Prospectus except for those made under the captions "Description of
Capital Stock" and "Underwriting" in the Prospectus insofar as they purport
to describe the provisions of the documents therein described and those
made under the caption "Certain United States Tax Consequences to Non-U.S.
Holders of Common Stock" in the Prospectus insofar as they relate to
provisions of U.S. Federal tax law therein described; and, such counsel
need express no opinion or belief as to the financial statements or other
financial data derived from accounting records contained in the
Registration Statement or the Prospectus.
(d) Xxxxxxxxx X. Short, Esq., Senior Vice President and General
Counsel, of the Company, shall have furnished to you his written opinion, dated
such Time of Delivery, in the form of Annex III (b) hereto that, to the best of
such counsel's knowledge and other than as set forth or contemplated in the
Prospectus, there are no legal or governmental proceedings pending to which the
Company or any of its subsidiaries is a party or of which any of the properties
or assets of the Company or any of its subsidiaries is the subject which would
reasonably be expected to have, singularly or in the aggregate, a Material
Adverse Effect; and, to the best of such counsel's knowledge and other than as
set forth or contemplated in the Prospectus, no such proceedings are threatened
by governmental authorities or by others.
(e) Xxxxxxx Xxxxx, counsel for ICE Futures, shall have furnished to you
his written opinion (a draft of such opinion is attached as Annex III(c)
hereto), dated such Time of Delivery, in form and substance satisfactory to you,
to the effect that, (i) IntercontinentalExchange Holdings and ICE Futures (each,
an "ICE Futures Entity") are duly incorporated in accordance with the laws of
England and Wales, (ii) ICE Futures is currently an unlimited company without a
share capital with its sole member being ICE Futures Holdings Plc, (iii) ICE
Futures Holdings Plc has an authorized share capital of
GBP(pound)100,050,000.00, divided into 500,000,000 ordinary shares of
GBP(pound)0.20, and 50,000 redeemable shares of GBP(pound)1.00 each and has
validly issued 11,450,319 ordinary shares of GBP(pound)0.20 each, which are held
by IntercontinentalExchange Holdings and no other shares have been issued or are
outstanding, and (iv) IntercontinentalExchange Holdings has a nominal share
capital of GBP(pound)50,003.00, divided into 50,003 shares of GBP(pound)1.00
each and has validly issued all of these shares, which are held by
21
IntercontinentalExchange International Inc. and no other shares have been issued
or are outstanding.
(f) The respective counsel for each of the Selling Shareholders, as
indicated in Schedule II hereto, each shall have furnished to you their written
opinion with respect to each of the Selling Shareholders for whom they are
acting as counsel (a draft of each such opinion is attached as Annex III(d)
hereto), dated such Time of Delivery, in form and substance satisfactory to you,
to the effect that:
(i) A Power of Attorney and a Custody Agreement have been duly
authorized, executed and delivered by such Selling Shareholder and
constitute valid and legally binding agreements of such Selling
Shareholder;
(ii) This Agreement has been duly authorized, executed and delivered
by or on behalf of such Selling Shareholder; and the sale of the Shares to
be sold by such Selling Shareholder hereunder and the compliance by such
Selling Shareholder with all of the provisions of this Agreement, the Power
of Attorney and the Custody Agreement and the consummation of the
transactions herein and therein contemplated will not conflict with or
result in a breach or violation of any terms or provisions of, or
constitute a default under, any statute, indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument known to such
counsel to which such Selling Shareholder is a party or by which such
Selling Shareholder is bound or to which any of the property or assets of
such Selling Shareholder is subject, nor will such action result in any
violation of the provisions of the organizational documents of such Selling
Shareholder if such Selling Shareholder is not an individual or any order,
rule or regulation known to such counsel of any court or governmental
agency or body having jurisdiction over such Selling Shareholder or any of
such Selling Shareholder's properties;
(iii) No consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required for the sale of the Shares to be sold by such Selling Shareholder,
the execution and delivery of this Agreement, the Power of Attorney, the
Custody Agreement hereinafter referred to, such Selling Shareholder has
full right, power and authority to sell, assign, transfer and deliver the
Shares to be sold by such Selling Shareholder hereunder, except the
registration under the Act of the Shares and such consents, approvals,
authorizations, registrations or qualifications as may be required under
state securities or Blue Sky laws or by the rules and regulations of the
NASD in connection with the purchase and distribution of the Shares by the
Underwriters;
(iv) Immediately prior to the First Time of Delivery such Selling
Shareholder has good and valid title to the Shares to be sold at the First
Time of Delivery by such Selling Shareholder under this Agreement, free and
clear of all Liens (such counsel may rely upon a certificate of such
Selling Shareholder in respect of matters of fact as to ownership of, and
liens, encumbrances, equities or claims on, the Shares sold by such Selling
Shareholder); and
22
(v) Immediately prior to each Time of Delivery (as defined in Section
5 of this Agreement), the Selling Shareholder will be the registered owner
of the Shares to be sold by such Selling Shareholder hereunder, free and
clear of all Liens, and upon payment for the Shares to be sold by such
Selling Shareholders as provided in this Agreement, delivery of such
Shares, as directed by the Underwriters, to Cede & Co. ("Cede") or such
other nominee as may be designated by DTC, registration of such shares in
the name of Cede or such other nominee and the crediting of such Shares on
the records of DTC to securities accounts of the Underwriters, (i) DTC
shall be a "protected purchaser" of such Shares within the meaning of
Section 8-303 of the UCC, (ii) under Section 8-501 of the UCC, the
Underwriters will acquire a valid security entitlement in respect of such
Shares and (iii) assuming that each Underwriter does not have "notice of an
adverse claim" (within the meaning of Section 8-105 of the UCC) to such
Shares, no action based on any "adverse claim" (within the meaning of
Section 8-102 of the UCC) to such Shares may be asserted against the
Underwriters with respect to such security entitlement.
(g) 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, 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 II hereto (the executed copy of the letter delivered prior to the
execution of this Agreement is attached as Annex I(a) hereto and a draft of the
form of letter 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);
(h) Otherwise than as set forth or contemplated in the Prospectus, (i)
neither the Company nor any of its subsidiaries shall have, since the date of
the latest audited financial statements included in the Prospectus, sustained
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; or incurred any
material liability or obligation, direct or contingent, or entered into any
material transaction not in the ordinary course of business; 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, short-term debt or 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,
business, financial position, stockholders' equity or results of operations of
the Company and its subsidiaries, taken as a whole; 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;
23
(i) On or after the Applicable Time, there shall not have occurred any
of the following: (i) a suspension or material limitation in trading in
securities generally on the Exchange; (ii) a suspension or material limitation
in trading in the Company's securities on the Exchange; (iii) a general
moratorium on commercial banking activities declared by either Federal or New
York State authorities or a material disruption in commercial banking or
securities settlement, payment or clearance services in the United States; (iv)
any outbreak or escalation of hostilities or any declaration by the United
States of a national emergency or war; (v) no downgrading shall have occurred in
the rating accorded the Company's 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; (vi) no such organization shall have
publicly announced that it has under surveillance or review, with possible
negative implications, its rating of the Company's preferred stock; or (vii) the
occurrence of any other calamity or crisis or any change in financial, political
or economic conditions in the United States or elsewhere, if the effect of any
such event specified in clause (iv) or (vii), singularly or together with any
other such event, 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 at such Time of Delivery shall have been duly
listed, subject to notice of issuance, on the Exchange;
(k) The "lockup" agreements, each either (i) substantially in the form
of Annex IV hereto, if between you and the Selling Shareholders, or (ii)
substantially in the form of Annex V hereto, if between you and the officers and
directors of the Company, in each case relating to sales and certain other
dispositions of shares of Common Stock or certain other securities, delivered to
you on or before the date of this Agreement, shall be in full force and effect
on the Closing Date;
(l) The Company shall have complied with the provisions of Section 5(c)
of this Agreement with respect to the furnishing of prospectuses on the New York
Business Day next succeeding the date of this Agreement;
(m) The Company and the Selling Shareholders shall have furnished or
caused to be furnished to you at such Time of Delivery (i) certificates of
officers of the Company and the Selling Shareholders, respectively, reasonably
satisfactory to you as to the accuracy of the representations and warranties of
the Company and the Selling Shareholders, respectively, herein at and as of such
Time of Delivery, as to the incumbency of such officers, as to the performance
by the Company and the Selling Shareholders 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 (h) of this Section and as to such other matters as
you may reasonably request and (ii) such documents as you may reasonably request
with respect to the due incorporation or formation and good standing of the
Company and its subsidiaries and the due authorization and issuance of the Firm
Shares and the Optional Shares; and
24
(n) The Underwriters shall have received a certificate of good standing
dated within one month of the Closing Date from the Financial Services Authority
relating to the organization, existence and good standing of ICE Futures.
9. (a) The Company 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, the Pricing Prospectus or the Prospectus, or any amendment or
supplement thereto, or any Issuer Free Writing Prospectus or any "issuer
information" filed or required to be filed pursuant to Rule 433(d) under the
Act, 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 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,
the Pricing Prospectus or the Prospectus, or any such amendment or supplement
thereto, or any Issuer Free Writing Prospectus, in reliance upon and in
conformity with written information furnished to the Company by any Underwriter
through the Representatives expressly for use therein.
(b) Each of the Selling Shareholders severally and not jointly will
indemnify and hold harmless the Company and each Underwriter against any losses,
claims, damages or liabilities, joint or several, to which such indemnified
party 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, the
Pricing Prospectus 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, the Pricing Prospectus or the Prospectus, or any such amendment or
supplement thereto, or any Issuer Free Writing Prospectus, in reliance upon and
in conformity with written information furnished to the Company by such Selling
Shareholder expressly for use therein; and will reimburse the Company and each
Underwriter for any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim as such expenses are incurred; provided, however, that the liability of
such Selling Shareholder pursuant to this Section 9 shall not exceed the product
of the number of Shares sold by such Selling Shareholder and the initial public
offering price of the Shares as set forth in the Prospectus.
25
(c) Each Underwriter will indemnify and hold harmless the Company and
each Selling Shareholder, as the case may be, against any losses, claims,
damages or liabilities to which such indemnified party, 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, the Pricing Prospectus or
the Prospectus, or any amendment or supplement thereto, or any Issuer Free
Writing Prospectus, 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, the Pricing Prospectus or the
Prospectus, or any such amendment or supplement thereto, or any Issuer Free
Writing Prospectus, in reliance upon and in conformity with written information
furnished to the Company by such Underwriter through the Representatives
expressly for use therein; and will reimburse the Company and each Selling
Shareholder, as the case may be, for any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending
any such action or claim as such expenses are incurred.
(d) Promptly after receipt by an indemnified party under subsection
(a), (b) or (c) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
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 (except to the extent
that the indemnifying party is materially prejudiced or otherwise forfeits
rights or defenses by reason of such failure). In case any such action shall be
brought against any indemnified party and it shall notify the indemnifying party
of the commencement thereof, any indemnified party shall have the right to
retain its own counsel, but the fees and expenses of such counsel shall be at
the expense of such indemnified party unless (i) the indemnifying party and the
indemnified party shall have mutually agreed to the retention of such counsel or
(ii) the named parties to any such proceeding (including any impleaded parties)
include both the indemnifying party and the indemnified party and representation
of both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood that the
indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for (i) the fees and expenses of more than one
separate firm (in addition to any local counsel) for all Underwriters and all
persons, if any, who control any Underwriter within the meaning of either
Section 15 of the Securities Act or Section 20 of the Securities Exchange Act of
1934, as amended or who are affiliates of any Underwriter within the meaning of
Rule 405 under the Act, (ii) the fees and expenses of more than one separate
firm (in addition to any local counsel) for the Company, its directors, its
officers who sign the Registration Statement and each person, if any, who
controls the Company within the meaning of either such Section and (iii) the
fees and expenses of more than one separate firm (in addition to any local
counsel) for all Selling Shareholders
26
and all persons, if any, who control any Selling Shareholder within the meaning
of either such Section, and that all such fees and expenses shall be reimbursed
as they are incurred. In the case of any such separate firm for the Underwriters
and such control persons and affiliates of any Underwriters, such firm shall be
designated in writing by the Representatives. In the case of any such separate
firm for the Company, and such directors, officers and control persons of the
Company, such firm shall be designated in writing by the Company. In the case of
any such separate firm for the Selling Shareholders and such control persons of
any Selling Shareholders, such firm shall be designated in writing by the
persons named as attorneys-in-fact for the Selling Shareholders under the Powers
of Attorney. The indemnifying party shall not be liable for any settlement of
any proceeding effected without its written consent, which shall not be
unreasonably withheld, but if settled with such consent or if there be a final
judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by the second
and third sentences of this paragraph, the indemnifying party agrees that it
shall be liable for any settlement of any proceeding effected without its
written consent if (i) such settlement is entered into more than 30 days after
receipt by such indemnifying party of the aforesaid request and (ii) such
indemnifying party shall not have reimbursed the indemnified party in accordance
with such request prior to the date of such settlement. 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.
(e) If the indemnification provided for in this Section 9 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a), (b) or (c) 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 Shareholders 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 (d) 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 Shareholders 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
27
benefits received by each of the Company, the Selling Shareholders and the
Underwriters shall be deemed to be in the same proportion as the total net
proceeds from the offering (before deducting expenses) received by the Company
and the Selling Shareholders, the total underwriting discounts and commissions
received by the Underwriters, in each case as set forth in the table on the
cover page of the Prospectus, bear to the sum of the total proceeds from the
sale of the Shares (before deducting expenses) in the offering. 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
and the Selling Shareholders 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 Shareholders and the Underwriters agree that it would not be just and
equitable if contributions pursuant to this subsection (e) were determined by
pro rata allocation or by any other method of allocation which does not take
account of the equitable considerations referred to above in this subsection
(e). 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 (e) 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 (e), 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, have 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 (e) to
contribute are several in proportion to their respective underwriting
obligations and not joint. The Selling Shareholder's obligations in this Section
9(e) to contribute are several in proportion to the amount being sold and not
joint and no Selling Shareholder shall be required to contribute an amount
greater than it would have been required to indemnify under this Agreement.
(f) The obligations of the Company and the Selling Shareholders under
this Section 9 shall be in addition to any liability which the Company and the
Selling Shareholders 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 Act; and the obligations of the Underwriters under this Section 9
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 (including any and each person, if any, who,
with his or her consent, is named in the Registration Statement as about to
become a director of the Company) and to each person, if any, who controls the
Company or any Selling Shareholder within the meaning of the Act.
10. (a) If any Underwriter shall default in its obligation to purchase
the Shares that 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
28
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 Shareholders 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 Shareholders that you
have so arranged for the purchase of such Shares, or the Company and the Selling
Shareholders notify you that they have so arranged for the purchase of such
Shares, you or the Company and the Selling Shareholders 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 or
supplements 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 Shareholders 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 the Shares to be purchased at such Time of Delivery,
then the Company and the Selling Shareholders 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 Shareholders as provided in subsection (a) above, the aggregate
number of such Shares which remains unpurchased exceeds one-eleventh of the
aggregate number of all the Shares to be purchased at such Time of Delivery, or
if the Company and the Selling Shareholders 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 the Selling Shareholders to sell the Optional
Shares) shall thereupon terminate, without liability on the part of any
non-defaulting Underwriter or the Company or the Selling Shareholders, except
for the expenses to be borne by the Company and the Selling Shareholders and the
Underwriters as provided in Section 8 of this Agreement and the indemnity and
contribution agreements in Section 11 of this Agreement; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
29
11. The respective indemnities, agreements, representations, warranties
and other statements of the Company, the Selling Shareholders 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, the Company or any of the Selling
Shareholders, or any officer or director or controlling person of the Company,
or any controlling person of any Selling Shareholder and shall survive delivery
of and payment for the Shares.
12. If this Agreement shall be terminated pursuant to Section 10 of
this Agreement, neither the Company nor the Selling Shareholders shall then be
under any liability to any Underwriter except as provided in Sections 7, 9 and
10 of this Agreement; but, if for any other reason, any Shares are not delivered
by or on behalf of the Company and the Selling Shareholders as provided herein,
the Company and each of the Selling Shareholders pro rata (based on the number
of Shares to be sold by the Company and the Selling Shareholders hereunder),
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 Shareholders shall then be under no further liability to any Underwriter
in respect of the Shares not so delivered except as provided in Sections 7, 9
and 10 of this Agreement.
13. (a) 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 as the Representatives; and in all dealings with any
Selling Shareholder hereunder, you and the Company shall be entitled to act and
rely upon any statement, request, notice or agreement on behalf of such Selling
Shareholder made or given by any or all of the Attorneys-in-Fact for such
Selling Shareholder.
(b) All statements, requests, notices and agreements hereunder shall be
in writing and effective only upon receipt, and if to the Underwriters shall be
delivered or sent by mail, telex or facsimile transmission to you as the
Representatives in care of (i) Xxxxxx Xxxxxxx & Co Incorporated, 0000 Xxxxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Equity Capital Markets Syndicate Desk and
(ii) Xxxxxxx, Sachs & Co., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Registration Department; if to any Selling Shareholder shall be delivered or
sent by mail, telex or facsimile transmission to counsel for such Selling
Shareholders at its address set forth in Schedule II hereto and if to the
Company shall be delivered or sent by mail to the address of the Company set
forth in the Registration Statement, Attention: General Counsel; provided,
however, that any notice to an Underwriter pursuant to Section 9(d) of this
Agreement shall be delivered or sent by mail, telex or facsimile transmission to
such Underwriter at its address set forth in its Underwriters' Questionnaire, or
telex constituting such Questionnaire, which address will be supplied to the
Company or the Selling Shareholder by you upon request; provided, however, that
notices under subsection 5(e) shall be in writing and if to the Underwriters
shall be delivered or sent by mail, telex or facsimile transmission to you as
30
the Representatives at Xxxxxx Xxxxxxx & Co. Incorporated, 0000 Xxxxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Global Capital Markets Syndicate Desk and
Xxxxxxx, Sachs & Co., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Control Room and if to any Selling Shareholder shall be delivered or sent by
mail or facsimile transmission to such Selling Shareholder at its address set
forth on Schedule III hereto. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
14. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, the Company and the Selling Shareholders and, to
the extent provided in Sections 9 and 11 of this Agreement, the officers and
directors of the Company (including any and each person, if any, who, with his
or her consent, is named in the Registration Statement as about to become a
director of the Company) and each person who controls the Company, any Selling
Shareholder, 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.
15. (a) This Agreement, together with any contemporaneous written
agreements and any prior written agreements (to the extent not superseded by
this Agreement) that relate to the offering of the Shares, represents the entire
agreement between the Company and the Underwriters with respect to the
preparation of the Prospectus, the conduct of the offering, and the purchase and
sale of the Shares.
(b) The Company acknowledges that in connection with the offering of
the Shares: (i) the Underwriters have acted at arms length, are not agents of,
and owe no fiduciary duties to, the Company or any other person, (ii) the
Underwriters owe the Company only those duties and obligations set forth in this
Agreement and (iii) the Underwriters may have interests that differ from those
of the Company. The Company waives to the full extent permitted by applicable
law any claims it may have against the Underwriters arising from an alleged
breach of fiduciary duty in connection with the offering of the Shares
16. Time shall be of the essence 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.
17. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.
18. 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.
If the foregoing is in accordance with your understanding, please sign
and return to us eight counterparts of this Agreement, and upon the acceptance
of this
31
Agreement by you, on behalf of each of the Underwriters, this letter and such
acceptance of this Agreement shall constitute a binding agreement among each of
the Underwriters, the Company and each of the Selling Shareholders. 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 Shareholders for examination upon request, but without warranty on your
part as to the authority of the signers thereof.
32
Any person executing and delivering this Agreement as Attorney-in-Fact
for a Selling Shareholder represents by so doing that he has been duly appointed
as Attorney-in-Fact by such Selling Shareholder pursuant to a validly existing
and binding Power-of-Attorney which authorizes such Attorney-in-Fact to take
such action.
Very truly yours,
IntercontinentalExchange, Inc.
By: /s/ XXXXXXX X. XXXXXXX
------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Senior Vice President,
Chief Financial Officer
The Selling Shareholders set forth
in Schedule II to this Agreement.
By: /s/ XXXXXXX X. XXXXXXX
------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Attorney-in-Fact
As Attorney-in-Fact acting on
behalf of each of the Selling
Shareholders named in Schedule II
to this Agreement.
Accepted as of the date of this Agreement:
Xxxxxxx, Xxxxx & Co.
Xxxxxx Xxxxxxx & Co. Incorporated
By: /s/ XXXXXXX, SACHS & CO
----------------------------------
(Xxxxxxx, Xxxxx & Co.)
By: /s/ XXXX XXXXX
----------------------------------
Xxxxxx Xxxxxxx & Co. Incorporated
On behalf of each of the Underwriters
33
SCHEDULE I
Number of Optional
Shares to be
Total Number of Purchased if
Firm Shares Maximum Option
Underwriter To be Purchased Exercised
----------- --------------- -----------------
Xxxxxxx, Sachs & Co.......................................2,758,000 413,700
Xxxxxx Xxxxxxx & Co. Incorporated.........................2,758,000 413,700
UBS Securities LLC.........................................709,200 106,380
Xxxxxxx Xxxxx & Company, L.L.C. ...........................709,200 106,380
Sandler X'Xxxxx & Partners, L.P. ..........................709,200 106,380
SG Americas Securities, LLC................................236,400 35,460
Susquehanna Financial Group, LLLP..........................120,000 18,000
Total..........................................8,000,000 1,200,000
34
SCHEDULE II
NUMBER OF
OPTIONAL SHARES
TOTAL NUMBER OF TO BE SOLD IF
FIRM SHARES TO BE MAXIMUM OPTION
SOLD EXERCISED
----------------- ---------------
IntercontinentalExchange, Inc................................... ... 25,000 0
The Selling Shareholders*:
Xxxxxx Xxxxxxx Capital Group Inc.................................... 1,766,469 330,422
The Xxxxxxx Sachs Group, Inc........................................ 1,759,925 329,198
Total Investments USA Inc........................................... 1,233,372 230,705
BP Foundation, Incorporated ........................................ 1,139,675 0
Societe Generale Financial Corporation.............................. 785,829 146,991
S T Exchange Inc. .................................................. 420,000 0
AEP Investments, Inc................................................ 237,210 44,370
Mirant Energy Trading, LLC ......................................... 223,171 41,745
Duke Energy Trading Exchange, LLC .................................. 213,256 39,890
El Paso Merchant Energy North America Company....................... 196,093 36,679
------------- ------------
Total.......................................................... 8,000,000 1,200,000
* Each Selling Shareholder has appointed Xxxxxxx X. Xxxxxxxx and Xxxxxxx X.
Xxxxxxx, and each of them, as the attorneys-in-fact for such Selling
Shareholder.
35
SCHEDULE III
[signatures of lock-up agreements]
Xxxxxx Xxxxxxx Capital Group Inc.
The Xxxxxxx Sachs Group, Inc.
Total Investments USA Inc.
BP Products North America Inc.
BP Foundation, Incorporated
Societe Generale Financial Corporation
S T Exchange Inc.
AEP Investments, Inc.
Mirant Energy Trading, LLC
Duke Energy Trading Exchange, LLC
El Paso Merchant Energy North America Company
Xxxxxxx X. Xxxxxxxx
Xxxxxxx X. Vice
Xxxxxxx X. Xxxxxxx
Xxxxx X. Xxxxx
Xxxxx X. Xxxxxxx
Xxxxx X. Xxxxxxx
Xxxxxxxxx X. Short
Xxxxxxx Xxxx
Xxxx-Xxxx Forneri
Xxxxxx X. Xxxx
Xxxxxxx X. Xxxxx
Xxxxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxxx
Xxxxxxx X. Xxxxxx
36
SCHEDULE IV
(A) ISSUER FREE WRITING PROSPECTUSES:
None.
(B) ADDITIONAL DOCUMENTS INCORPORATED BY REFERENCE:
None.
37
ANNEX II
FORM OF COMFORT LETTER
Ladies and Gentlemen:
We have audited the consolidated balance sheets of IntercontinentalExchange,
Inc. and subsidiaries (the "Company") as of December 31, 2005 and 2004, and the
consolidated statements of income, changes in shareholders' equity,
comprehensive income, and cash flows for each of the three years in the period
ended December 31, 2004, and the related schedule, all included in the
Registration Statement (No. 333-135060) on Form S-1 filed by the Company under
the Securities Act of 1933 (the "Act"); our report with respect thereto also is
included in such Registration Statement, as amended as of July , 2006, herein
referred to as the "Registration Statement."
In connection with the Registration Statement:
1. We are an independent registered public accounting firm with respect to the
Company within the meaning of the Act and the applicable rules and
regulations thereunder adopted by the Securities and Exchange Commission
("SEC") and the Public Company Accounting Oversight Board (United States)
("PCAOB").
2. In our opinion, the consolidated financial statements and financial
statement schedule audited by us and included in the Registration Statement
comply as to form in all material respects with the applicable accounting
requirements of the Act and the related rules and regulations adopted by
the SEC.
3. We have not audited any financial statements of the Company as of any date
or for any period subsequent to December 31, 2005. The purpose (and
therefore the scope) of our audit for the year ended December 31, 2005 was
to enable us to express our opinion on the consolidated financial
statements at December 31, 2005 and for the year then ended, but not on the
financial statements for any interim period within such year. Therefore, we
are unable to express and do not express an opinion on: the unaudited
condensed consolidated balance sheet at March 31, 2006; the unaudited
condensed consolidated statements of income, changes in shareholders'
equity, comprehensive income, and cash flows for the three-month periods
ended March 31, 2006 and 2005, included or incorporated by reference in the
Registration Statement; or the financial position, results of operations,
or cash flows as of any date or for any period subsequent to December 31,
2005.
4. For purposes of this letter, we have read the 2006 minutes of meetings of
the shareholders and the Board of Directors, the audit committee, the
compensation committee, and the nominating and corporate governance
committee of the Company and its subsidiaries as set forth in the minute
books through July 12, 2006, officials of the Company having advised us
that the minutes of all such meetings through that date were set forth
therein, except for the meetings of the Board of Directors held on May 11,
2006 and June 1, 2006, the audit committee held on May 10, 2006, the
compensation committee held on May 11, 2006, and the nominating and
corporate
38
governance committee held on June 20, 2006, for which minutes have not been
prepared. With respect to the meetings held on May 10, 2006, May 11, 2006,
June 1, 2006, and June 20, 2006, we have obtained from the Secretary
summaries of the topics discussed at such meetings. We also have carried
out other procedures to July 12, 2006 as follows (our work did not extend
to the period from July 13, 2006 to July 17, 2006 inclusive):
a. With respect to the three-month periods ended March 31, 2006 and 2005, we
have:
(i) performed the procedures specified by the PCAOB for a review of interim
financial information as described in XX 000, Xxxxxxx Financial
Information, on the unaudited condensed consolidated balance sheet at March
31, 2006 and the unaudited condensed consolidated statements of income,
changes in shareholders' equity, comprehensive income, and cash flows for
the three-month periods ended March 31, 2006 and 2005, included in the
Registration Statement; and
(ii) inquired of certain officials of the Company who have responsibility for
financial and accounting matters as to whether the unaudited condensed
consolidated financial statements referred to under paragraph 4.a.(i)
comply as to form in all material respects with the applicable accounting
requirements of the Act and the related rules and regulations adopted by
the SEC.
b. With respect to the period from April 1, 2006 to May 31, 2006, we have:
(i) read the unaudited consolidated financial statements for April and May of
both 2006 and 2005 furnished to us by the Company, officials of the Company
having advised us that no such financial statements as of any date or for
any period subsequent to May 31, 2006 were available; and
(ii) inquired of certain officials of the Company who have responsibility for
financial and accounting matters as to whether the unaudited consolidated
financial statements referred to under paragraph 4.b.(i) are stated on a
basis substantially consistent with that of the audited consolidated
financial statements included in the Registration Statement.
The foregoing procedures do not constitute an audit conducted in accordance
with the standards of the PCAOB. Also, they would not necessarily reveal
matters of significance with respect to the comments in the following
paragraph. Accordingly, we make no representations as to the sufficiency of
the foregoing procedures for your purposes.
5. Nothing came to our attention as a result of the foregoing procedures that
caused us to believe that:
a. any material modifications should be made to the unaudited condensed
consolidated financial statements described in paragraph 4.a.(i) above,
included in the Registration Statement, for them to be in conformity with
U.S. generally accepted accounting principles;
39
b. the unaudited condensed financial statements described in paragraph 4.a.(i)
above do not comply as to form in all material respects with the applicable
accounting requirements of the Act and the related rules and regulations
adopted by the SEC; or
c. (i) at May 31, 2006, there was any change in the capital stock, increase in
long-term debt or decrease in consolidated net current assets or
shareholders' equity of the consolidated companies as compared with the
amounts shown in the March 31, 2006 unaudited condensed consolidated
balance sheet included in the Registration Statement; or (ii) for the
period from April 1, 2006 to May 31, 2006 there was any decrease, as
compared with the corresponding period in the preceding year, in
consolidated net revenues or in the total or per-share amounts of
consolidated net income and consolidated net income available to common
shareholders, except in all instances for changes, increases, or decreases
that the Registration Statement discloses have occurred or may occur.
6. As mentioned under paragraph 4.b. above, Company officials have advised us
that no consolidated financial statements as of any date or for any period
subsequent to May 31, 2006 are available; accordingly, the procedures
carried out by us with respect to changes in financial statement items
after May 31, 2006 have, of necessity, been even more limited than those
with respect to the periods referred to in paragraph 4. above. We have
inquired of certain officials of the Company who have responsibility for
financial and accounting matters as to whether: (i) at July 12, 2006 there
was any change in the capital stock, increase in long-term debt or any
decreases in consolidated net current assets or shareholders' equity of the
Company as compared with the amounts shown on the March 31, 2006 unaudited
condensed consolidated balance sheet included in the Registration
Statement, or (ii) for the period from April 1, 2006 to July 12, 2006,
there were any decreases, as compared with the corresponding period in the
preceding year, in consolidated net revenues or in the total or per-share
amounts of consolidated net income and consolidated net income available to
common shareholders. On the basis of these inquiries and our reading of the
minutes as described in paragraph 4. above, nothing came to our attention
that caused us to believe that there was any such change, increase, or
decrease, except in all instances for changes, increases, or decreases that
the Registration Statement discloses have occurred or may occur.
7. At your request, we have also read the items identified by you on the
attached copy of the Registration Statement, and have performed the
following procedures, which were applied as indicated with respect to the
symbols explained below. Certain dollar amounts and percentages included in
the Registration Statement have been rounded or truncated as deemed
appropriate by the Company. In all instances where we noted agreement of
dollar and other amounts or ratios, such agreement is after giving
consideration to such rounding or truncating.
A. Compared the dollar amounts to the amounts in the audited consolidated
financial statements described in the introductory paragraph of this
letter, or for prior years, included in the Company's audited financial
statements for the years 2002 or 2001, or to amounts in the unaudited
condensed consolidated financial statements
40
described in paragraph 3. above, to the extent such amounts are included in
or can be derived from such statements and found them to be in agreement.
B. Compared the dollar and other amounts not derived directly from audited or
unaudited consolidated financial statements to amounts in the Company's
accounting records to the extent such amounts could be so compared directly
and found them to be in agreement.
C. Compared the dollar and other amounts not derived directly from audited or
unaudited consolidated financial statements, or that could not be compared
directly to the Company's accounting records, to amounts in analyses
prepared by the Company from its accounting records and found them to be in
agreement.
D. Proved the arithmetic accuracy of the percentages or amounts based on the
data in the above-mentioned financial statements, accounting records, and
analyses.
We compared the executive compensation information with the requirements of Item
402 of Regulation S-K. We also inquired of certain officials of the Company who
have responsibility for financial and accounting matters with respect to whether
the executive compensation information conforms in all material respects with
the disclosure requirements of Item 402 of Regulation S-K. Nothing came to our
attention that caused us to believe that this information does not conform in
all material respects with the disclosure requirements of Item 402 of Regulation
S-K. We make no legal representations as to questions of legal interpretation
regarding the completeness or appropriateness of the Company's determination of
what constitutes executive compensation for purposes of the SEC disclosure
requirements on executive compensation.
We make no comment as to the appropriateness or completeness of the Company's
determination of the Regulation S-K requirements for quantitiative and
qualitative disclosures about market risks nor with respect to the
reasonableness of the assumptions underlying the disclosures.
We make no representation as to whether the transaction will take place or the
number of shares to be sold in the transaction.
We compared the information included under the heading "Selected Financial Data"
with the requirements of Item 301 of Regulation S-K. We also inquired of certain
officials of the Company who have responsibility for financial and accounting
matters whether this information conforms in all material respects with the
disclosure requirements of Item 301 of Regulation S-K. Nothing came to our
attention as a result of the foregoing procedures that caused us to believe that
this information does not conform in all material respects with the disclosure
requirements of Item 301 of Regulation S-K.
8. Our audits of the consolidated financial statements for the periods
referred in to in the introductory paragraph of this letter were comprised
of audit tests and procedures deemed necessary for the purpose of
expressing an opinion on such financial statements taken as a whole. For
neither the periods referred to therein nor any other
41
period did we perform audit tests for the purpose of expressing an opinion
on individual balances of accounts of summaries of selected transactions
such as those enumerated above and, accordingly, we do not express an
opinion thereon.
9. It should be understood that we make no representations as to questions of
legal interpretation or as to the sufficiency for your purposes of the
procedures enumerated in paragraph 7. above; also, such procedures would
not necessarily reveal any material misstatement of the information
identified in paragraph 7. above. Further, we have addressed ourselves
solely to the foregoing data as set forth in the Registration Statement and
make no representations as to the adequacy of disclosure or as to whether
any material facts have been omitted.
10. This letter is solely for the information of the addressee and to assist
the underwriters in conducting and documenting their investigation of the
affairs of the Company in connection with the offering of the securities
covered by the Registration Statement, and is not to be used, circulated,
quoted or otherwise referred to within or without the underwriting group
for any other purpose, including, but not limited to, the registration,
purchase, or sale of securities, nor is it to be filed with or referred to
in whole or in part in the Registration Statement or any other document,
except that reference may be made to it in the underwriting agreement or
any list of closing documents pertaining to the offering of the securities
covered by the Registration Statement.
Very truly yours,
42
ANNEX III
FORM OF OPINIONS
43
ANNEX IV
FORM OF SELLING SHAREHOLDER LOCK UP LETTER
IntercontinentalExchange, Inc.
Secondary Lock-Up Agreement
________, 2006
Re: IntercontinentalExchange, Inc. - Secondary Lock-Up Agreement
Ladies and Gentlemen:
The undersigned understands that Xxxxxxx, Xxxxx & Co. and Xxxxxx
Xxxxxxx & Co. Incorporated, or such other investment banks as the Company may
select, as representatives (the "Representatives"), propose to enter into an
Underwriting Agreement (the "Underwriting Agreement") on behalf of the several
Underwriters named in Schedule I to such agreement (collectively, the
"Underwriters"), with IntercontinentalExchange, Inc., a Delaware corporation
(the "Company"), providing for a public offering (the "Public Offering") of
shares of Common Stock, par value $0.01 per share, of the Company (the "Shares")
pursuant to a Registration Statement on Form S-1 (the "Registration Statement")
to be filed with the Securities and Exchange Commission (the "SEC"). Common
stock, at any time means all shares of the Company's common stock issued and
outstanding at such time, including all Class A Common Stock, Series 1 and all
Class A Common Stock, Series 2 then outstanding and shares of common stock into
which all such Class A Common Stock, Series 1 and Class A Common Stock, Series 2
may be convertible pursuant to the Fourth Amended and Restated Certificate of
Incorporation or is then issued and outstanding (collectively, "Common Stock").
In consideration of the agreement by the Underwriters to offer and sell
the Shares, and of other good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, the undersigned agrees that, during
the period specified below (the "Lock-Up Period"), the undersigned or any of its
respective affiliates will not (1) offer, sell, contract to sell, pledge,
hypothecate, sell any option or contract to purchase, purchase any option or
contract to sell, grant any option, right or warrant to purchase, lend, make any
short sale or otherwise transfer or dispose of, directly or indirectly, any
shares of Common Stock, any options, rights or warrants to purchase any shares
of Common Stock or any securities convertible into, exercisable or exchangeable
for or that represent the right to receive shares of Common Stock, whether now
owned or hereinafter acquired, owned directly by the undersigned (including
holding as a custodian) or with respect to which the undersigned has beneficial
ownership within the rules and regulations of the SEC (collectively, the
"Undersigned's Shares") or (2) enter into any swap or other arrangement that
transfers to another, in whole or in part, any of the economic consequences of
44
ownership of the Undersigned's Shares, whether any such transaction described in
clause (1) or (2) above is to be settled by delivery of Common Stock or such
other securities, in cash or otherwise, or (3) file or cause the Company to file
any registration statement with the SEC relating to the offering of any shares
of Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock. The foregoing sentence shall not apply to the
Registration Statement or the sale of any shares to the Underwriters pursuant to
the Underwriting Agreement or an amount up to ten percent (10%) of the
Undersigned's Shares as of May 22, 2006, which may be sold by the undersigned
during a period beginning on May 22, 2006 and extending through a date to be
specified in writing by the Company, on behalf of the Representatives to the
undersigned.
The foregoing restrictions are expressly agreed to preclude the
undersigned or any of its respective affiliates from engaging in any hedging or
other transaction which is designed to or which reasonably could be expected to
lead to or result in a sale or disposition of the Undersigned's Shares even if
such shares would be disposed of by someone other than the undersigned. Such
prohibited hedging or other transactions would include without limitation any
short sale or any sale or grant of any right (including without limitation any
put or call option) with respect to any of the Undersigned's Shares or with
respect to any security that includes, relates to, or derives any significant
part of its value from such shares.
Notwithstanding anything herein to the contrary, the undersigned and
its respective affiliates may engage in brokerage, investment advisory,
investment company, financial advisory, principal investing, anti-raid advisory,
merger advisory, financing, asset management, trading, market making, arbitrage
and other similar activities conducted in the ordinary course of its and its
affiliates' business and any hedging or other transactions incidental thereto;
provided, however, that the undersigned's investment of _________ shares in the
Company, as such investment (as a capital investment and not as a result of the
financial services activities of the undersigned or its affiliates described
above in this paragraph) may be increased or reduced in accordance with the
provisions of this Lock-Up Agreement and whether held by the undersigned or any
of its affiliates, shall be subject to the restrictions of this Lock-Up
Agreement.
Notwithstanding anything to the contrary contained herein, the
undersigned or any of its respective affiliates may (A) transfer the
Undersigned's Shares (i) as a bona fide gift or gifts, provided that the donee
or donees thereof agree to be bound in writing by the restrictions set forth
herein, (ii) to any trust for the direct or indirect benefit of the undersigned
or the immediate family of the undersigned, provided that the trustee of the
trust agrees to be bound in writing by the restrictions set forth herein, and
provided further that any such transfer shall not involve a disposition for
value, or (iii) with the prior written consent of the Representatives on behalf
of the Underwriters and (B) exercise any options or other rights granted
pursuant to the Company's 2000 Stock Option Plan, the Company's 2003 Restricted
Stock Deferral Plan for Outside Directors, the Company's 2004 Restricted Stock
Plan, or the Company's 2005 Equity Incentive Plan (collectively, the "Benefit
Plans"), or convert or exchange any convertible or exchangeable securities
outstanding on the date hereof; provided that in the case of any transfer or
distribution pursuant to the foregoing no filing by any party (donor, donee,
transferor or transferee) under Section 16(a) of the Securities Exchange Act of
1934, as amended, (the "Exchange Act"), shall be
45
required or shall be made voluntarily in connection with such transfer or
distribution (other than a filing on a Form 5 made after the expiration of the
Lock-Up Period). For purposes of this Lock-Up Agreement, "immediate family"
shall mean any relationship by blood, marriage or adoption, not more remote than
first cousin. In addition, notwithstanding the foregoing, if the undersigned is
a corporation, the corporation may transfer the capital stock of the Company to
any wholly-owned subsidiary of such corporation; provided, however, that in any
such case, it shall be a condition to the transfer that the transferee execute
an agreement stating that the transferee is receiving and holding such capital
stock subject to the provisions of this Agreement, that no filing under Section
16(a) of the Exchange Act, shall be required or shall be made voluntarily in
connection with such transfer or distribution (other than a filing on a Form 5
made after the expiration of the Lock-Up Period) and there shall be no further
transfer of such capital stock except in accordance with this Agreement, and
provided further that any such transfer shall not involve a disposition for
value. As of the date hereof, the undersigned has good and marketable title to
the Undersigned's Shares, free and clear of all liens, encumbrances and claims
whatsoever. In addition, the undersigned agrees that, it will not, during the
Lock-Up Period, make any demand for or exercise any right with respect to, the
registration of any shares of Common Stock or any security convertible into or
exercisable or exchangeable for Common Stock. The undersigned also agrees and
consents to the entry of stop transfer instructions with the Company's transfer
agent and registrar against the transfer of the Undersigned's Shares except in
compliance with the foregoing restrictions.
The initial Lock-Up Period will commence on the earlier of May 22, 2006
or the date that the Registration Statement is filed with the SEC and continue
for 90 days after the date of the final prospectus covering the Public Offering;
provided, however, that if (1) during the last 17 days of the initial Lock-Up
Period, the Company releases earnings results or announces material news or a
material event or (2) prior to the expiration of the initial Lock-Up Period, the
Company announces that it will release earnings results during the 15-day period
following the last day of the initial Lock-Up Period, then in each case the
Lock-Up Period will be automatically extended until the expiration of the 18-day
period beginning on the date of the release of the earnings results or the
announcement of the material news or material event, as applicable, unless the
Representatives, on behalf of the Underwriters, waive, in writing, such
extension.
The undersigned hereby acknowledges that the Company has agreed in the
Underwriting Agreement to provide written notice of any event that would result
in an extension of the Lock-Up Period pursuant to the previous paragraph to the
undersigned (in accordance with Section 5(e) of the Underwriting Agreement) and
agrees that any such notice properly delivered will be deemed to have been given
to, and received by, the undersigned. The undersigned hereby further agrees
that, prior to engaging in any transaction or taking any other action that is
subject to the terms of this Lock-Up Agreement during the period from the date
of this Lock-Up Agreement to and including the 34th day following the expiration
of the initial Lock-Up Period, it will give notice thereof to the Company and
will not consummate such transaction or take any such action unless it has
received written confirmation from the Company that the Lock-Up Period (as such
may have been extended pursuant to the previous paragraph) has expired.
46
The undersigned understands that the Company and the Underwriters are
relying upon this Lock-Up Agreement in proceeding toward consummation of the
Public Offering. The undersigned further understands that this Lock-Up Agreement
is irrevocable and shall be binding upon the undersigned's heirs, legal
representatives, successors and assigns. Whether or not the Public Offering
actually occurs depends on a number of factors, including market conditions. If
the filing of the Registration Statement does not occur on or before June 16,
2006 or the Registration Statement is not declared effective by the SEC on or
before July 10, 2006, this Lock-Up Agreement shall terminate. Any Public
Offering will only be made pursuant to the Underwriting Agreement, the terms of
which are subject to negotiation between the Company and the Underwriters.
Very truly yours,
------------------------------------
Exact Name of Shareholder
------------------------------------
Authorized Signature
------------------------------------
Title
47
ANNEX V
FORM OF OFFICER AND DIRECTOR LOCK UP LETTER
IntercontinentalExchange, Inc.
Secondary Lock-Up Agreement
[ ], 2006
Xxxxxxx, Xxxxx & Co.
Xxxxxx Xxxxxxx & Co. Incorporated
As representatives of the several Underwriters
named in Schedule I hereto (the
"Representatives"),
c/o Goldman, Sachs & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
and
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: IntercontinentalExchange, Inc. - Secondary Lock-Up Agreement
Ladies and Gentlemen:
The undersigned understands that Xxxxxxx, Sachs & Co. and Xxxxxx
Xxxxxxx & Co. Incorporated, as representatives (the "Representatives"), propose
to enter into an Underwriting Agreement (the "Underwriting Agreement") on behalf
of the several Underwriters named in Schedule I to such agreement (collectively,
the "Underwriters"), with IntercontinentalExchange, Inc., a Delaware corporation
(the "Company"), providing for a public offering (the "Public Offering") of
shares of Common Stock, par value $0.01 per share, of the Company (the "Shares")
pursuant to a Registration Statement on Form S-1 (File No. 333- 135060) filed
with the Securities and Exchange Commission (the "SEC"). Common stock, at any
time means all shares of the Company's common stock issued and outstanding at
such time, including all the Class A Common Stock, Series 2 then outstanding and
shares of common stock into which all such Class A Common Stock, Series 2 may be
convertible pursuant to the Fourth Amended and Restated Certificate of
Incorporation or is then issued and outstanding (collectively, "Common Stock").
In consideration of the agreement by the Underwriters to offer and sell
the Shares, and of other good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, the undersigned agrees that, during
the period specified below (the "Lock-Up Period"), the undersigned will not (1)
offer, sell, contract to sell, pledge, hypothecate, sell any option or contract
to purchase, purchase any option or contract to sell, grant any
48
option, right or warrant to purchase, lend, make any short sale or otherwise
transfer or dispose of, directly or indirectly, any shares of Common Stock, any
options, rights or warrants to purchase any shares of Common Stock or any
securities convertible into, exercisable or exchangeable for or that represent
the right to receive shares of Common Stock, whether now owned or hereinafter
acquired, owned directly by the undersigned (including holding as a custodian)
or with respect to which the undersigned has beneficial ownership within the
rules and regulations of the SEC (collectively, the "Undersigned's Shares") or
(2) enter into any swap or other arrangement that transfers to another, in whole
or in part, any of the economic consequences of ownership of the Undersigned's
Shares, whether any such transaction described in clause (1) or (2) above is to
be settled by delivery of Common Stock or such other securities, in cash or
otherwise, or (3) file or cause the Company to file any registration statement
with the SEC relating to the offering of any shares of Common Stock or any
securities convertible into or exercisable or exchangeable for Common Stock. The
foregoing sentence shall not apply to the sale of any shares to the Underwriters
pursuant to the Underwriting Agreement.
The foregoing restrictions are expressly agreed to preclude the
undersigned from engaging in any hedging or other transaction which is designed
to or which reasonably could be expected to lead to or result in a sale or
disposition of the Undersigned's Shares even if such shares would be disposed of
by someone other than the undersigned. Such prohibited hedging or other
transactions would include without limitation any short sale or any sale or
grant of any right (including without limitation any put or call option) with
respect to any of the Undersigned's Shares or with respect to any security that
includes, relates to, or derives any significant part of its value from such
shares.
Notwithstanding anything to the contrary contained herein, the
undersigned may (A) transfer the Undersigned's Shares (i) as a bona fide gift or
gifts, provided that the donee or donees thereof agree to be bound in writing by
the restrictions set forth herein, (ii) to any trust for the direct or indirect
benefit of the undersigned or the immediate family of the undersigned, provided
that the trustee of the trust agrees to be bound in writing by the restrictions
set forth herein, and provided further that any such transfer shall not involve
a disposition for value, or (iii) with the prior written consent of the Xxxxxxx,
Xxxxx & Co. and Xxxxxx Xxxxxxx & Co. Incorporated on behalf of the Underwriters
(B) transfer the Undersigned's Shares pursuant to a plan complying with Rule
10b5-1 under the Exchange Act that has been entered into prior to the date
hereof or, in the case of any director, is entered into after the date hereof
and (C) exercise any options or other rights granted pursuant to the Company's
2000 Stock Option Plan, the Company's 2003 Restricted Stock Deferral Plan for
Outside Directors, the Company's 2004 Restricted Stock Plan, or the Company's
2005 Equity Incentive Plan (collectively, the "Benefit Plans"), or convert or
exchange any convertible or exchangeable securities outstanding on the date
hereof; provided that in the case of any transfer or distribution pursuant to
the foregoing no filing by any party (donor, donee, transferor or transferee)
under Section 16(a) of the Securities Exchange Act of 1934, as amended, (the
"Exchange Act"), shall be required or shall be made voluntarily in connection
with such transfer or distribution (other than a filing on a Form 5 made after
the expiration of the Lock-Up Period). For purposes of this Lock-Up Agreement,
"immediate family" shall mean any relationship by blood, marriage or adoption,
not more remote than first cousin. In addition, notwithstanding the foregoing,
if
49
the undersigned is a corporation, the corporation may transfer the capital stock
of the Company to any wholly-owned subsidiary of such corporation; provided,
however, that in any such case, it shall be a condition to the transfer that the
transferee execute an agreement stating that the transferee is receiving and
holding such capital stock subject to the provisions of this Agreement, that no
filing under Section 16(a) of the Exchange Act, shall be required or shall be
made voluntarily in connection with such transfer or distribution (other than a
filing on a Form 5 made after the expiration of the Lock-Up Period) and there
shall be no further transfer of such capital stock except in accordance with
this Agreement, and provided further that any such transfer shall not involve a
disposition for value. As of the date hereof, the undersigned has good and
marketable title to the Undersigned's Shares, free and clear of all liens,
encumbrances and claims whatsoever. In addition, the undersigned agrees that, it
will not, during the Lock-Up Period, make any demand for or exercise any right
with respect to, the registration of any shares of Common Stock or any security
convertible into or exercisable or exchangeable for Common Stock. The
undersigned also agrees and consents to the entry of stop transfer instructions
with the Company's transfer agent and registrar against the transfer of the
Undersigned's Shares except in compliance with the foregoing restrictions.
The initial Lock-Up Period will commence on the date of this Lock-Up
Agreement and continue for 90 days after the date of the final prospectus
covering the Public Offering; provided, however, that if (1) during the last 17
days of the initial Lock-Up Period, the Company releases earnings results or
announces material news or a material event or (2) prior to the expiration of
the initial Lock-Up Period, the Company announces that it will release earnings
results during the 15-day period following the last day of the initial Lock-Up
Period, then in each case the Lock-Up Period will be automatically extended
until the expiration of the 18-day period beginning on the date of the release
of the earnings results or the announcement of the material news or material
event, as applicable, unless Xxxxxxx, Sachs & Co. and Xxxxxx Xxxxxxx & Co.
Incorporated, on behalf of the Underwriters, waive, in writing, such extension.
The undersigned hereby acknowledges that the Company has agreed in the
Underwriting Agreement to provide written notice of any event that would result
in an extension of the Lock-Up Period pursuant to the previous paragraph to the
undersigned (in accordance with Section 5(e) of the Underwriting Agreement) and
agrees that any such notice properly delivered will be deemed to have been given
to, and received by, the undersigned. The undersigned hereby further agrees
that, prior to engaging in any transaction or taking any other action that is
subject to the terms of this Lock-Up Agreement during the period from the date
of this Lock-Up Agreement to and including the 34th day following the expiration
of the initial Lock-Up Period, it will give notice thereof to the Company and
will not consummate such transaction or take any such action unless it has
received written confirmation from the Company that the Lock-Up Period (as such
may have been extended pursuant to the previous paragraph) has expired.
The undersigned understands that the Company and the Underwriters are
relying upon this Lock-Up Agreement in proceeding toward consummation of the
Public Offering. The undersigned further understands that this Lock-Up Agreement
is irrevocable and shall be binding upon the undersigned's heirs, legal
representatives, successors and assigns. Whether or not the Public Offering
actually occurs depends on a number of factors,
50
including market conditions. If the closing of the Public Offering does not
occur on or before August 11, 2006, this Lock-Up Agreement shall terminate. Any
Public Offering will only be made pursuant to the Underwriting Agreement, the
terms of which are subject to negotiation between the Company and the
Underwriters.
Very truly yours,
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Exact Name
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Authorized Signature
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Title
51
