SNAP-ON INCORPORATED
(a Delaware corporation)
6 5/8% Notes due October 1, 2005
TERMS AGREEMENT
Snap-on Incorporated
0000-00xx Xxxxxx
Xxxxxxx, Xxxxxxxxx 00000-0000
Dated: September 28, 1995
Ladies and Gentlemen:
We (the "Representative") understand that Snap-on Incorporated, a
Delaware corporation (the "Company"), proposes to issue and sell the
Securities set forth below (the "Underwritten Securities"). Subject to
the terms and conditions set forth or incorporated by reference herein,
the underwriters named below (the "Underwriters") offer to purchase,
severally and not jointly, the respective amounts of Underwritten
Securities set forth below opposite their respective names at the purchase
price set forth below.
Principal
Amount of
Underwriter Debt Securities
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated . . . . . . . . . . . . . . . . . . $50,000,000
Xxxxxx Xxxxxxx & Co. Incorporated . . . . . . . . . . . . . . $50,000,000
----------
Total: $100,000,000
===========
The Underwritten Securities shall have the following terms:
Title of Debt Securities:
6 5/8% Notes due October 1, 2005
Currency:
U.S. Dollars
Principal Amount to be Issued:
$100,000,000
Current Ratings:
Xxxxx'x Investors Service, Inc.: Aa3
Standard & Poor's Corporation: AA
Interest Rate or Formula:
6 5/8%
Interest Payment Dates:
Semiannually on April 1 and October 1, commencing April 1, 1996
Date of Maturity:
October 1, 2005
Redemption Provisions:
None
Sinking Fund Requirements:
None
Delayed Delivery Contracts:
None
Initial Public Offering Price:
$99,697,000 (99.697%), plus accrued interest, if any, from October 3,
1995.
Purchase Price:
$99,047,000 (99.047%), plus accrued interest, if any, from October 3,
1995 (payable in same day funds).
Closing Date:
October 3, 1995
Indenture:
The Underwritten Securities are issued under an Indenture, dated as
of September 15, 1995, between the Company and Firstar Trust Company,
as Trustee.
Closing Location for Delivery of Securities:
The Depository Trust Company
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
All the provisions contained in the document attached as Annex A
hereto entitled "Snap-on Incorporated--Debt Securities, Debt Warrants,
Preferred Stock, Preferred Warrants and Currency Warrants-Underwriting
Agreement Basic Provisions" (the "Underwriting Agreement Basic
Provisions") are hereby incorporated by reference in their entirety herein
and shall be deemed to be a part of this Terms Agreement to the same
extent as if such provisions had been set forth in full herein. Terms
defined in such document are used herein as therein defined.
Effective June 7, 1995, the Securities and Exchange Commission (the
"Commission") adopted new rules and regulations regarding (i) the delivery
of final prospectuses under the Securities Act of 1933, as amended and
(ii) the securities transaction settlement requirements of the Securities
Exchange Act of 1934, as amended (Release No. 33-7168; 34-35704; IC-21061)
(collectively, the "New Rules"). Notwithstanding anything to the contrary
in the Underwriting Agreement Basic Provisions, the Company hereby agrees
to prepare, deliver and file such documents in a timely manner (including,
but not limited to, timely delivery of a final prospectus to the Under-
writers) so as to cause the Company to comply, and to allow the Under-
writers to comply, with the New Rules. The Company agrees to take such
further actions as are reasonably requested by the Underwriters to facil-
itate compliance by the Company and the Underwriters with the New Rules.
Please accept this offer by signing a copy of this Terms Agreement in
the space set forth below and returning the signed copy to us, which
thereupon will constitute a binding agreement between us as of September
28, 1995.
Very truly yours,
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By /s/ Xxx Xxxxxxxxxxx
Name: Xxx Xxxxxxxxxxx
Title: Vice President
Acting on behalf of itself and the other named Under-
writers
Accepted:
SNAP-ON INCORPORATED
By /s/ Xxxxxx X. Xxxx
Name: Xxxxxx X. Xxxx
Title: Senior Vice President
ANNEX A
SNAP-ON INCORPORATED
(a Delaware corporation)
Debt Securities, Debt Warrants, Preferred Stock,
Preferred Warrants and Currency Warrants
UNDERWRITING AGREEMENT BASIC PROVISIONS
Snap-on Incorporated, a Delaware corporation (the "Company"),
proposes to issue and sell, from time to time in one or more offerings and
on terms and in the respective amounts to be determined at the time of
sale, its senior debt securities (the "Debt Securities"), warrants to
purchase Debt Securities (the "Debt Warrants"), preferred stock, par value
$1.00 per share (the "Preferred Stock"), warrants to purchase Preferred
Stock (the "Preferred Warrants") or currency warrants (the "Currency War-
rants"). As used herein, "Securities" shall mean the Debt Securities,
Debt Warrants, Preferred Stock, Preferred Warrants, Currency Warrants or
any combination thereof; and "Warrant Securities" shall mean the Debt
Securities or Preferred Stock issuable upon exercise of Debt Warrants or
Preferred Warrants, respectively. The Debt Warrants may be offered
together with Debt Securities or separately. The Preferred Warrants may
be offered together with Preferred Stock or separately.
The Debt Securities will be issued under an indenture dated as
of September 15, 1995 (the "Indenture") between the Company and Firstar
Trust Company, as trustee (the "Trustee). The Debt Warrants, Preferred
Warrants and Currency Warrants will be issued under one or more warrant
agreements (each a "Debt Warrant Agreement," "Preferred Warrant Agreement"
or Currency Warrant Agreement," respectively), between the Company and the
warrant agent identified therein (each a "Warrant Agent"). The terms and
rights of any particular issue of Securities shall be as specified in the
Terms Agreement (as defined below) relating thereto and in or pursuant to
the Indenture, Debt Warrant Agreement, Preferred Warrant Agreement or
Currency Warrant Agreement or, with respect to the Preferred Stock, the
Restated Certificate of Incorporation, as amended, of the Company
(including the Certificate of Designation with respect to any Preferred
Stock (the "Certificate of Designation")) (the "Certificate of Incorpora-
tion"), as the case may be (each a "Securities Agreement"). Each issue of
Securities may vary, as applicable, as to aggregate principal amount,
number of shares or warrants, maturity date, duration and exercise price
of warrants, interest or dividend rate or formula and timing of payments
thereof, redemption provisions and sinking fund requirements, if any, and
any other variable terms which the applicable Securities Agreement contem-
plates may be set forth in the Securities as issued from time to time.
This is to confirm the arrangements with respect to the purchase
of Securities (the "Underwritten Securities") from the Company by the
Representative and the several Underwriters listed in the applicable terms
agreement entered into between the Representative and the Company to which
this Underwriting Agreement is attached as Annex A (the "Terms Agree-
ment"). With respect to any particular Terms Agreement, the Terms
Agreement, together with the provisions hereof incorporated therein by
reference, is herein referred to as the "Agreement." Terms defined in the
Terms Agreement are used herein as therein defined.
The Company meets the requirements for the use of Form S-3 under
the Securities Act of 1933, as amended (the "1933 Act"), and has filed
with the Securities and Exchange Commission (the "Commission") a regis-
tration statement on Form S-3 (No. 33-55607) for the registration of the
Securities and the offering thereof from time to time in accordance with
Rule 415 under the 1933 Act, and has filed such amendments thereto as may
have been required to the date of the Terms Agreement. Such registration
statement, as amended, has been declared effective by the Commission, and
the Indenture has been qualified under the Trust Indenture Act of 1939, as
amended (the "1939 Act"). Such registration statement, as amended,
including all documents incorporated therein by reference and the
information deemed to be part of the registration statement pursuant to
Rule 430A of the 1933 Act Regulations (defined below), as from time to
time amended pursuant to the 1933 Act, the Securities Exchange Act of
1934, as amended (the "1934 Act"), or otherwise, is referred to herein as
the "Registration Statement." The prospectus contained in the
Registration Statement at its effective date, including any Preliminary
Prospectus-Supplement (as defined below) is herein referred to as the "Basic
Prospectus." Any preliminary prospectus supplement to the Basic Prospectus
which describes the Underwritten Securities and the offering thereof and
is used prior to the filing of the Prospectus (as defined below) is herein
referred to as a "Preliminary Prospectus Supplement." The prospectus
supplement relating to the sale of Underwritten Securities, in the form
first filed pursuant to Rule 424(b) of the 1933 Act after the execution of
the Terms Agreement (a "Prospectus Supplement"), together with the Basic
Prospectus, or, if no filing is required pursuant to said Rule 424(b), the
form of prospectus relating to the Underwritten Securities, including the
Basic Prospectus, is referred to herein as the "Prospectus"; provided,
however, that a Prospectus Supplement shall be deemed to have supplemented
the Prospectus only with respect to the offering of Underwritten
Securities to which it relates. All references in this Agreement to
financial statements and schedules and other information which is
"contained," "included" or "stated" in the Registration Statement or the
Prospectus (and all other references of like import) shall be deemed to
mean and include all such financial statements and schedules and other
information which is or is deemed to be incorporated by reference in the
Registration Statement or the Prospectus, as the case may be; and all
references in this Agreement to amendments or supplements to the Regis-
tration Statement, the Basic Prospectus, any Preliminary Prospectus
Supplement or the Prospectus shall be deemed to mean and include the
filing of any document under the 1934 Act which is or is deemed to be
incorporated by reference in the Registration Statement, the Basic Pro-
spectus, any Preliminary Prospectus Supplement or the Prospectus, as the
case may be.
SECTION 1. Representations and Warranties.
(a) The Company represents and warrants to the Representative
and to each Underwriter named in a Terms Agreement as of the date thereof
(the "Representation Date"), as follows:
(i) At the time the Registration Statement became
effective, the Registration Statement complied, and as of
each applicable Representation Date, will comply, in all
material respects with the requirements of the 1933 Act and
the rules and regulations of the Commission thereunder (the
"1933 Act Regulations") and the 1939 Act and the rules and
regulations of the Commission thereunder (the "1939 Act
Regulations"). The Registration Statement, at the time the
Registration Statement became effective, did not, and at
each time thereafter at which any amendment becomes
effective and as of the applicable Representation Date,
will not, contain any untrue statement of a material fact
or omit to state any material fact required to be stated
therein or necessary to make the statements therein not
misleading. The Basic Prospectus, as of its date, and the
Prospectus, as of the applicable Representation Date, did
not, and at the Closing Time referred to in Section 2
hereof, will not, contain an untrue statement of a material
fact or omit to state a material fact necessary in order to
make the statements therein, in light of the circumstances
under which they were made, not misleading; provided, how-
ever, that the representations and warranties in this
subsection shall not apply to statements in or omissions
from the Registration Statement or Prospectus made in reli-
ance upon and in conformity with information furnished to
the Company in writing by any Underwriter through the
Representative expressly for use in the Registration State-
ment or Prospectus or to that part of the Registration
Statement which constitutes the Statement of Eligibility
and Qualification under the 1939 Act on Form T-1 (the "Form
T-1") of the Trustee under the Indenture.
(ii) Xxxxxx Xxxxxxxx LLP, which has certified certain
financial statements of the Company included in the
Registration Statement, are independent public ac-
countants as required by the 1933 Act and the 1933 Act
Regulations.
(iii) The financial statements included in the Reg-
istration Statement and the Prospectus present fairly the
financial position of the Company and its consolidated
subsidiaries as at the dates indicated and the results of
their operations for the periods specified; except as oth-
erwise stated in the Registration Statement, said financial
statements have been prepared in conformity with generally
accepted accounting principles applied on a consistent
basis during the periods involved; the supporting schedules
contained in the Registration Statement present fairly the
information required to be stated therein; and the
Company's ratios of earnings to fixed charges (actual and,
if any, pro forma) included in the Prospectus under the
caption "Ratio of Earnings to Fixed Charges" and in Exhibit
12 to the Registration Statement have been calculated in
compliance with Item 503(d) of Regulation S-K of the Com-
mission.
(iv) The documents incorporated or deemed to be
incorporated by reference in the Prospectus, at the time
they were or hereafter are filed with the Commission, com-
plied and will comply in all material respects with the
requirements of the 1934 Act and the rules and regulations
of the Commission thereunder (the "1934 Act Regulations"),
and, when read together and with the other information in
the Prospectus, at the time the Registration Statement
became effective and at the time any amendments thereto
become effective or thereafter during the period specified
in Section 3(b) hereof, did not and will not contain an un-
true statement of a material fact or omit to state a mate-
rial fact required to be stated therein or necessary to
make the statements therein, in the light of the circum-
stances under which they were made, not misleading.
(v) Since the respective dates as of which
information is given in the Registration Statement and the
Prospectus, except as otherwise stated therein: (A) there
has been no material adverse change in the condition,
financial or otherwise, or in the earnings, business af-
fairs or business prospects of the Company and its subsid-
iaries considered as one enterprise, whether or not arising
in the ordinary course of business (a "Material Adverse
Change"), (B) there have been no transactions entered into
by the Company or any of its subsidiaries, other than those
in the ordinary course of business, which are material with
respect to the Company and its subsidiaries considered as
one enterprise and (C) except for regular quarterly divi-
dends on the Company's common stock, par value $1.00 per
share (the "Common Stock"), in amounts per share that are
consistent with past practice, there has been no dividend
or distribution of any kind declared, paid or made by the
Company on any class of its capital stock.
(vi) The Company has been duly incorporated and is
validly existing as a corporation in good standing under
the laws of the State of Delaware with corporate power and
authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus; and
the Company is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdic-
tion in which such qualification is required, whether by
reason of the ownership or leasing of property or the
conduct of business, except where the failure to so qualify
would not have a material adverse effect on the condition,
financial or otherwise, or in the earnings, business
affairs or business prospects of the Company and its
subsidiaries considered as one enterprise (a "Material
Adverse Effect").
(vii) Each subsidiary of the Company which is a
significant subsidiary as defined in Rule 405 of the 1933
Act Regulations (collectively, the "Significant
Subsidiaries" and individually, a "Significant Subsidiary")
has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the juris-
diction of its incorporation, has corporate power and
authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus; each
such Significant Subsidiary is duly qualified as a foreign
corporation to transact business and is in good standing in
each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property
or the conduct of business, except where the failure to so
qualify would not have a Material Adverse Effect; and all
of the issued and outstanding shares of capital stock of
each such Significant Subsidiary have been duly authorized
and validly issued, are fully paid and non-assessable and
are owned by the Company, directly or through subsidiaries
(other than directors' qualifying shares with respect to
certain of the Company's non-United States subsidiaries as
required by law), free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity.
(viii) The authorized, issued and outstanding capital
stock of the Company is as set forth in the Prospectus; and
all of the issued and outstanding shares of capital stock
of the Company have been duly authorized and validly issued
and are fully paid and non-assessable.
(ix) Neither the Company nor any of its Significant
Subsidiaries is in violation of its charter or by-laws; and
neither the Company nor any of its Significant Subsidiaries
is in default in the performance or observance of any obli-
gation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease
or other agreement or instrument to which the Company or
any of its Significant Subsidiaries is a party or by which
any of them may be bound, or to which any of the property
or assets of the Company or any of its Significant Subsid-
iaries is subject, except where such default would not have
a Material Adverse Effect; and the execution, delivery and
performance of this Agreement, the applicable Securities
Agreement and the Securities and the consummation of the
transactions contemplated herein and therein, have been
duly authorized by all necessary corporate action and will
not conflict with or constitute a breach of, or a default
under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the
Company or any of its Significant Subsidiaries pursuant to,
any material contract, indenture, mortgage, loan agreement,
note, lease or other agreement or instrument to which the
Company or any of its Significant Subsidiaries is a party
or by which any of them may be bound, or to which any of
the property or assets of the Company or any of its Signif-
icant Subsidiaries is subject, nor will such action result
in any violation of the provisions of the charter or by-
laws of the Company or any of its Significant Subsidiaries
or any applicable law, administrative regulation or court
decree.
(x) The Underwritten Securities have been duly
authorized for issuance and sale by the Company pursuant to
this Agreement (or will have been so authorized prior to
each issuance of Underwritten Securities) and, when issued,
authenticated and delivered pursuant to the provisions of
this Agreement and the applicable Securities Agreement
against payment of the consideration therefor in accordance
with this Agreement, any Underwritten Securities
constituting capital stock of the Company will be validly
issued and fully paid and non-assessable and any other Un-
derwritten Securities will be valid and binding obligations
of the Company, in each case entitled to the benefits of
the applicable Securities Agreement and enforceable in ac-
cordance with their terms; and the Warrant Securities, if
any, have been duly authorized by the Company and, when
executed and authenticated as specified in the applicable
Securities Agreement, and delivered against payment pursu-
ant to such Securities Agreement, any Warrant Securities
constituting capital stock of the Company will be validly
issued and fully paid and non-assessable and any other War-
rant Securities will be valid and binding obligations of
the Company, in each case entitled to the benefits of the
applicable Securities Agreement and enforceable in accor-
dance with their terms.
(xi) The applicable Securities Agreement has been
duly authorized, executed and delivered by the Company and,
in the case of the Certificate of Designation, has been
filed with the Secretary of State of the State of Delaware
and, in the case of the Indenture, has been duly qualified
under the 1939 Act, and, assuming due authorization, execu-
tion and delivery by the Trustee, in the case of the Inden-
ture, and the Warrant Agent, in the case of any Warrant
Agreement, constitutes a valid and binding obligation of
the Company, enforceable in accordance with its terms.
(xii) The Underwritten Securities and the applicable
Securities Agreement will conform in all material respects
to the respective statements relating thereto contained in
the Prospectus and will be in substantially the respective
forms filed or incorporated by reference, as the case may
be, as exhibits to the Registration Statement; and the
issuance of the Underwritten Securities is not subject to
preemptive or other similar rights.
(xiii) The Debt Securities rank and will rank on a
parity with all unsecured indebtedness (other than
subordinated indebtedness) of the Company that is out-
standing on the date hereof or that may be incurred
hereafter, and senior to all subordinated indebtedness of
the Company that is outstanding on the date hereof or that
may be incurred hereafter.
(xiv) There is no action, suit or proceeding before
or by any court or governmental agency or body, domestic or
foreign, now pending, or, to the knowledge of the Company,
threatened, against or affecting the Company or any of its
subsidiaries, which is required to be disclosed in the
Registration Statement or which might result in a Material
Adverse Effect (other than as disclosed in the Registration
Statement) or which might materially and adversely affect
the consummation of this Agreement; all pending legal or
governmental proceedings to which the Company or any of its
subsidiaries is a party or of which any of their respective
property or assets is the subject which are not described
in the Registration Statement, including ordinary routine
litigation incidental to the business, are, considered in
the aggregate, not material; and there are no contracts or
documents of the Company or any of its subsidiaries which
are required to be filed as exhibits to the Registration
Statement by the 1933 Act, the 1933 Act Regulations or the
1939 Act which have not been so filed.
(xv) Each of the Company and its Significant Sub-
sidiaries has good title to all properties owned by them,
in each case free and clear of all liens, encumbrances and
defects except (A) such as singly or in the aggregate do
not materially interfere with the use made and proposed to
be made of such properties, (B) as described in the Pro-
spectus or (C) as singly or in the aggregate could not rea-
sonably be expected to have a Material Adverse Effect.
(xvi) The Company and its Significant Subsidiaries
own or possess, or can acquire on reasonable terms, the
patents, patent rights, licenses, inventions, copyrights,
know-how (including trade secrets and other unpatented
and/or unpatentable proprietary or confidential informa-
tion, systems or procedures), trademarks, service marks and
trade names (collectively, "patent and proprietary rights")
presently employed by them in connection with the business
now operated by them, except where the failure to so own or
possess such patent and proprietary rights would not have a
Material Adverse Effect, and neither the Company nor any of
its Significant Subsidiaries has received any notice or is
otherwise aware of any infringement of or conflict with as-
serted rights of others with respect to any patent or pro-
prietary rights, or any facts which would render any patent
and proprietary rights invalid or inadequate to protect the
interest of the Company or any of its Significant Sub-
sidiaries therein, and which infringement or conflict (if
the subject of an unfavorable decision, ruling or finding)
or invalidity or inadequacy, singly or in the aggregate,
would result in a Material Adverse Effect.
(xvii) No material labor dispute with the employees
of the Company or any of its subsidiaries exists or, to the
knowledge of the Company, is imminent; and the Company is
not aware of any existing or imminent labor disturbance by
the employees of any of its principal suppliers, manufac-
turers or contractors which might be expected to result in
a Material Adverse Effect.
(xviii) No authorization, approval, consent or order
of any court or governmental authority or agency is
necessary in connection with the sale of the Underwritten
Securities to the Underwriters hereunder, except such as
may be required under the 1933 Act, the 1933 Act
Regulations, the 1939 Act or state securities laws. Nei-
ther the Company nor any of its affiliates is presently
"doing any business" with the government of Cuba or with
any person or affiliate located in Cuba, as such term is
defined by the Florida Department of Banking and Finance.
(xix) The Company and its Significant Subsidiaries
possess such certificates, authorizations or permits issued
by the appropriate state, federal or foreign regulatory
agencies or bodies necessary to conduct the business now
operated by them, except where the failure to so possess
such certificates, authorizations or permits would not have
a Material Adverse Effect, and neither the Company nor any
of its subsidiaries has received any notice of proceedings
relating to the revocation or modification of any such
certificate, authorization or permit which, singly or in
the aggregate, if the subject of an unfavorable decision,
ruling or finding, would result in a Material Adverse
Effect.
(xx) The Company and each of its subsidiaries main-
tain insurance policies or reserves with respect to such
insurable properties, potential liabilities and occurrences
that merit or require catastrophic insurance in amounts
deemed adequate in the reasonable opinion of the Company's
management; and all such insurance policies are in full
force and effect.
(xxi) Neither the Company nor any of its subsidiaries
has violated any environmental, safety or similar law or
regulation applicable to its business relating to the
protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), lacks any permits,
licenses or other approvals required of them under appli-
cable Environmental Laws or is violating any terms and
conditions of any such permit, license or approval, except
in each case as could not have a Material Adverse Effect.
(xxii) Neither the Company nor any of its
subsidiaries is, or as a result of the transactions
contemplated by the Prospectus or any Securities Agreement
would be, required to make any filing or to register under
the Investment Company Act of 1940, as amended.
(b) Any certificate signed by any officer of the Company and
delivered to the Representative or to counsel for the Underwriters in
connection with an offering of Underwritten Securities shall be
deemed a representation and warranty by the Company, as to the
matters covered thereby, to each Underwriter participating in such
offering.
SECTION 2. Purchase and Sale. The obligations of the Underwriters
to purchase, and the Company to sell, the Underwritten Securities shall be
evidenced by the Terms Agreement. The Terms Agreement specifies the
principal amount or number of Underwritten Securities, the names of the
Underwriters participating in the offering (subject to substitution as
provided in Section 10 hereof) and the principal amount or number of
Underwritten Securities which each Underwriter severally has agreed to
purchase, the purchase price to be paid by the Underwriters for the Under-
written Securities, the initial public offering price, if any, of the
Underwritten Securities, any delayed delivery arrangements and any terms
of the Underwritten Securities not already specified in the Securities
Agreement pursuant to which they are being issued (including, but not
limited to, designations, denominations, current ratings, interest or
dividend rates or formulas and payment dates, exercise prices, maturity
dates, redemption provisions and sinking fund requirements). In addition,
each Terms Agreement relating to any Preferred Stock shall specify whether
the Company has agreed to grant to the Underwriters, an option to purchase
additional Preferred Stock subject to such option (the "Option
Securities"). As used herein, the term "Underwritten Securities" shall
include all or any portion of the Option Securities agreed to be purchased
by the Underwriters as provided herein, if any.
The several commitments of the Underwriters to purchase Underwritten
Securities pursuant to the Terms Agreement shall be deemed to have been
made on the basis of the representations and warranties herein contained
and shall be subject to the terms and conditions herein set forth.
In addition, on the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth,
the Company may grant, if so provided in the Terms Agreement relating to
any Preferred Stock, an option to the Underwriters named in such Terms
Agreement, severally and not jointly, to purchase up to the number of
Option Securities set forth therein at the same price per share as is
applicable to the Preferred Stock. Such option, if granted, will expire
30 days or such lesser number of days as may be specified in the Terms
Agreement after the Representation Date relating to the Preferred Stock,
and may be exercised in whole or in part from time to time only for the
purpose of covering over-allotments which may be made in connection with
the offering and distribution of the Preferred Stock upon notice by the
Representative to the Company setting forth the number of Option Securi-
ties as to which the several Underwriters are then exercising the option
and the time and date of payment and delivery for such Option Securities.
Any such time and date of delivery (a "Date of Delivery") shall be deter-
mined by the Representative, but shall not be later than seven full
business days and not earlier than two full business days after the exer-
cise of said option, unless otherwise agreed upon by the Representative
and the Company. If the option is exercised as to all or any portion of
the Option Securities, each of the Underwriters, acting severally and not
jointly, will purchase that proportion of the total number of Option
Securities then being purchased which the number of shares of Preferred
Stock each such Underwriter has agreed to purchase as set forth in the
related Terms Agreement bears to the total number of shares of Preferred
Stock, subject to such adjustments as the Representative in its discretion
shall make to eliminate any sales or purchases of fractional shares.
Payment of the purchase price for, and delivery of, any Underwritten
Securities to be purchased by the Underwriters shall be made at the office
of Skadden, Arps, Slate, Xxxxxxx & Xxxx, 000 Xxxx Xxxxxx Xxxxx, Xxxxx
0000, Xxxxxxx, Xxxxxxxx 00000, or at such other place as shall be agreed
upon by the Representative and the Company, at 10:00 A.M. New York City
time, on the fifth business day (unless postponed in accordance with the
provisions of Section 10 hereof) following the date of the Terms Agreement
or such other time as shall be agreed upon by the Representative and the
Company (each such time and date being referred to as a "Closing Time");
provided, however, that in the event that any or all of the Option
Securities are purchased by the Underwriters, payment of the purchase
price for, and delivery of certificates representing, such Option
Securities, shall be made at the above-mentioned office of Skadden, Arps,
Slate, Xxxxxxx & Xxxx, or at such other place as shall be agreed upon by
the Representative and the Company, on each Date of Delivery as specified
in the notice from the Representative to the Company. Payment shall be
made to the Company by certified or official bank check or checks in New
York Clearing House or similar next day funds payable to the order of the
Company against delivery to the Representative for the respective accounts
of the Underwriters of certificates for the Underwritten Securities to be
purchased by them. Certificates for the Underwritten Securities shall be
in such denominations and registered in such names as the Representative
may request in writing at least two business days prior to the applicable
Closing Time. The certificates for the Underwritten Securities, which may
be in temporary form, will be made available for examination and packaging
by the Representative on or before the first business day prior to Closing
Time.
If authorized by the Terms Agreement, the Underwriters named therein
may solicit offers to purchase Underwritten Securities from the Company
pursuant to delayed delivery contracts ("Delayed Delivery Contracts") sub-
stantially in the form of Exhibit A hereto with such changes therein as
the Company may approve. As compensation for arranging Delayed Delivery
Contracts, the Company will pay to the Representative at Closing Time, for
the accounts of the Underwriters, the fee specified in the Terms Agreement
for each of the Underwritten Securities for which Delayed Delivery
Contracts are made at Closing Time. Any Delayed Delivery Contracts are to
be with institutional investors of the types set forth in the Prospectus
Supplement. At Closing Time the Company will enter into Delayed Delivery
Contracts (for not less than the minimum principal amount or number of
Underwritten Securities per Delayed Delivery Contract specified in the
applicable Terms Agreement) with all purchasers proposed by the Under-
writers and previously approved by the Company as provided below, but not
for an aggregate principal amount or number of Underwritten Securities in
excess of that specified in the Terms Agreement. The Underwriters will
not have any responsibility for the validity or performance of Delayed
Delivery Contracts.
The Representative shall submit to the Company, at least three
business days prior to Closing Time, the names of any institutional
investors with which it is proposed that the Company will enter into
Delayed Delivery Contracts and the principal amount or number of
Underwritten Securities, as the case may be, to be purchased by each of
them, and the Company will advise the Representative, at least two
business days prior to Closing Time, of the names of the institutions with
which the making of Delayed Delivery Contracts is approved by the Company
and the principal amount or number of Underwritten Securities, as the case
may be, to be covered by each such Delayed Delivery Contract.
The principal amount or number of Underwritten Securities, as the
case may be, agreed to be purchased by the respective Underwriters
pursuant to the Terms Agreement shall be reduced by the principal amount
or number of Underwritten Securities, as the case may be, covered by De-
layed Delivery Contracts as to each Underwriter as set forth in a written
notice delivered by the Representative to the Company; provided, however,
that the total principal amount or number of Underwritten Securities, as
the case may be, to be purchased by all Underwriters shall be the total
amount or number of Underwritten Securities, as the case may be, covered
by the applicable Terms Agreement, less the principal amount or number of
Underwritten Securities, as the case may be, covered by Delayed Delivery
Contracts.
SECTION 3. Covenants of the Company. The Company covenants with the
Representative, and with each Underwriter participating in the offering of
Underwritten Securities, as follows:
(a) Immediately following the execution of the Terms Agreement,
the Company will prepare a Prospectus Supplement setting forth the
principal amount or number of Underwritten Securities, as the case
may be, covered thereby and any of their terms not otherwise set
forth in the Prospectus, the names of the Underwriters participating
in the offering and the principal amount or the number of
Underwritten Securities which each severally has agreed to purchase,
the price at which the Underwritten Securities are to be purchased by
the Underwriters from the Company, the initial public offering price,
the selling concession and reallowance, if any, any delayed delivery
arrangements, and such other information as the Representative and
the Company deem appropriate in connection with the offering of the
Underwritten Securities. The Company will promptly transmit copies
of the Prospectus Supplement to the Commission for filing pursuant to
Rule 424 of the 1933 Act Regulations and will furnish to the Under-
writers named therein as many copies of the Prospectus and such
Prospectus Supplement as the Representative shall reasonably request.
(b) If, at any time when the Prospectus is required by law to
be delivered in connection with sales of the Underwritten Securities,
any event shall occur or condition exist as a result of which it is
necessary, in the opinion of counsel for the Underwriters, to further
amend or supplement the Prospectus in order that the Prospectus will
not include an untrue statement of a material fact or omit to state
any material fact necessary to make the statements therein not mis-
leading in the light of circumstances existing at the time it is
delivered to a purchaser or if it shall be necessary, in the opinion
of counsel for the Underwriters, at any such time to amend or
supplement the Registration Statement or the Prospectus in order to
comply with the requirements of the 1933 Act or the 1933 Act Regula-
tions, the Company will forthwith prepare and file with the Commis-
sion such amendment or supplement (in form and substance reasonably
satisfactory to the Underwriters), whether by filing documents pursu-
ant to the 1934 Act or otherwise, as may be necessary to correct such
untrue statement or omission or to make the Registration Statement
and Prospectus comply with such requirements.
(c) With respect to each sale of Underwritten Securities, the
Company will make generally available to its security holders as soon
as practicable, but not later than 90 days after the close of the
period covered thereby, earnings statements (in form complying with
the provisions of Rule 158 of the 1933 Act Regulations) covering 12-
month periods beginning, in each case, not later than the first day
of the Company's fiscal quarter next following the "effective date"
of the Registration Statement or a post-effective amendment thereto
(as defined in said Rule 158).
(d) The Company will use the net proceeds received by it from
the sale of the Underwritten Securities in the manner described in
the Prospectus under the caption "Use of Proceeds."
(e) At any time when the Prospectus is required by law to be
delivered in connection with sales of the Underwritten Securities,
the Company will give the Representative notice of its intention to
file or prepare any amendment to the Registration Statement
(including any post-effective amendment) or any amendment or supple-
ment to the Prospectus (including any revised prospectus which the
Company proposes for use by the Underwriters in connection with the
offering of the Underwritten Securities which differs from the
prospectus on file at the Commission at the time the Registration
Statement becomes effective, whether or not such revised prospectus
is required to be filed pursuant to Rule 424(b) of the 1933 Act
Regulations), whether pursuant to the 1934 Act, the 1933 Act or
otherwise, will furnish the Representative with copies of any such
amendment or supplement within a reasonable amount of time prior to
such proposed filing or use, as the case may be, and will not file
any such amendment or supplement or use any such prospectus to which
the Representative or counsel for the Underwriters shall object.
(f) At any time when the Prospectus is required by law to be
delivered in connection with sales of the Underwritten Securities,
the Company will notify the Representative immediately, and confirm
such notice in writing, of (i) the effectiveness of any amendment to
the Registration Statement, (ii) the mailing or the delivery to the
Commission for filing of any supplement to the Prospectus or any
document to be filed pursuant to the 1934 Act, (iii) the receipt of
any comments from the Commission with respect to the Registration
Statement, the Prospectus or any supplement to the Prospectus,
(iv) any request by the Commission for any amendment to the
Registration Statement or any amendment or supplement to the
Prospectus or for additional information and (v) the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or the initiation of any proceedings for that
purpose. The Company will make every reasonable effort to prevent
the issuance of any stop order and, if any stop order is issued, to
obtain the lifting thereof at the earliest possible moment.
(g) The Company will deliver to the Representative one signed
copy and as many conformed copies of the Registration Statement as
originally filed and of each amendment thereto, whether filed before
or after the Registration Statement becomes effective (including
exhibits filed therewith or incorporated by reference therein and
documents incorporated or deemed to be incorporated by reference in
the Prospectus) as the Representative may reasonably request and will
also deliver to the Representative a conformed copy of the Registra-
tion Statement as originally filed and of each amendment thereto
(without exhibits) for each of the Underwriters.
(h) The Company will furnish to each Underwriter, from time to
time during the period when the Prospectus is required by law to be
delivered in connection with sales of the Underwritten Securities,
such number of copies of the Prospectus (as amended or supplemented)
as such Underwriter may reasonably request for the purposes
contemplated by the 1933 Act, the 1933 Act Regulations, the 1934 Act
or the 1934 Act Regulations.
(i) The Company will endeavor, in cooperation with the
Underwriters, to qualify the Underwritten Securities for offering and
sale under the applicable securities laws of such jurisdictions as
the Representative may designate; provided, however, that the Company
shall not be obligated to file any general consent to service of
process or to qualify as a foreign corporation in any jurisdiction in
which it is not so qualified. The Company will maintain such quali-
fications in effect for as long as may be required for the dis-
tribution of the Underwritten Securities. The Company will file such
statements and reports as may be required by the laws of each
jurisdiction in which the Underwritten Securities have been qualified
as above provided. The Company will inform the Florida Department of
Banking and Finance if at any time prior to the completion of the
distribution of the Underwritten Securities by the Underwriters it
commences engaging in business with the government of Cuba or with
any person located in Cuba, such information to be provided within 90
days after the commencement thereof, or after a change occurs with
respect to previously reported information.
(j) To the fullest extent permitted by applicable laws, the
Company will not claim voluntarily, and will resist actively any
attempts to claim the benefit of, any usury laws against the holders
of the Debt Securities.
(k) The Company, during the period when the Prospectus is re-
quired to be delivered by law in connection with the sale of the
Underwritten Securities, will file all documents required to be filed
with the Commission pursuant to Section 13, 14 or 15 of the 1934 Act
within the time periods required by the 1934 Act and the 1934 Act
Regulations.
(l) Between the date of the Terms Agreement and the later of
termination of any trading restrictions or Closing Time with respect
to the Underwritten Securities covered thereby, except for the
issuance of Warrant Securities upon the exercise of Debt Warrants or
Preferred Warrants, if any, the Company will not, without the Repre-
sentative's prior written consent, directly or indirectly, sell,
offer to sell, enter into any agreement to sell, grant any option for
the sale of, or otherwise dispose of, any securities of or guaranteed
by the Company or any of its subsidiaries which are similar to the
Underwritten Securities covered by such Terms Agreement, or any
securities convertible into or exchangeable or exercisable for any
such Underwritten Securities or such similar securities, including
additional Securities.
(m) If provided in the applicable Terms Agreement, the
Company will use its best efforts to effect the listing of the
Underwritten Securities and any Warrant Securities issuable upon
exercise of the Underwritten Securities on a national securities
exchange.
SECTION 4. Conditions of Underwriters' Obligations. The several
obligations of the Underwriters to purchase Underwritten Securities
pursuant to the Terms Agreement are subject to the accuracy of the
representations and warranties on the part of the Company herein
contained, to the accuracy of the statements of the Company's officers
made in any certificate furnished pursuant to the provisions hereof, to
the performance by the Company of all of its covenants and other
obligations hereunder and to the following further conditions:
(a) At the applicable Closing Time (i) no stop order suspending
the effectiveness of the Registration Statement shall have been
issued under the 1933 Act or proceedings therefor initiated or
threatened by the Commission, (ii) the ratings assigned by Xxxxx'x
Investors Service, Inc. and Standard & Poor's Corporation to the
Underwritten Securities or any other securities of, or guaranteed by,
the Company or any of its subsidiaries as of the date of the Terms
Agreement shall not have been lowered since the execution of such
Terms Agreement and none of such securities rating agencies shall
have publicly announced that it has under surveillance or review,
with possible negative implications, its rating of the Underwritten
Securities or any other securities of, or guaranteed by, the Company
or any of its subsidiaries, and (iii) there shall not have come to
the Representative's attention any facts that would cause the
Representative to believe that the Prospectus, together with the
applicable Prospectus Supplement, at the time it was required to be
delivered to a purchaser of the Underwritten Securities, contained an
untrue statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in the light
of the circumstances existing at such time, not misleading. The
Prospectus Supplement prepared by the Company pursuant to Section
3(a) hereof shall have been transmitted to the Commission for filing
pursuant to Rule 424(b) of the 1933 Act Regulations within the pre-
scribed time period and prior to Closing Time the Company shall have
provided evidence satisfactory to the Representative of such timely
filing, or a post-effective amendment shall have been promptly filed
and declared effective in accordance with the requirements of Rule
430A of the 1933 Act Regulations.
(b) At the applicable Closing Time, the Representative shall
have received:
(1) The favorable opinion, dated as of the applicable
Closing Time, of Xxxxx X. Xxxxxxxx, Vice President, Secretary
and General Counsel of the Company, in form and substance satis-
factory to the Representative, to the effect that:
(i) The Company and each of its Significant
Subsidiaries is (a) a corporation duly incorporated and (b)
validly existing as a corporation in good standing under
the laws of its jurisdiction of incorporation.
(ii) The Company and each of its Significant
Subsidiaries has the corporate power and authority to own,
lease and operate its properties and to conduct its busi-
ness as described in the Registration Statement.
(iii) The Company and each of its Significant
Subsidiaries is duly qualified as a foreign corporation to
transact business and is in good standing in each ju-
risdiction in which such qualification is required, except
where the failure to so qualify would not have a Material
Adverse Effect.
(iv) (A) The authorized issued and outstanding
capital stock of the Company is as set forth in the
Prospectus and (B) all of the issued and outstanding shares
of capital stock of the Company have been duly authorized
and validly issued and are fully paid and non-assessable.
(v) All of the issued and outstanding shares of
capital stock of each of the Company's Significant
Subsidiaries have been duly authorized and validly issued
and are fully paid and non-assessable.
(vi) This Agreement and the Delayed Delivery
Contracts, if any, have been duly authorized, executed and
delivered by the Company.
(vii) The Underwritten Securities have been duly
authorized for issuance and sale by the Company pursuant to
this Agreement and, when executed and authenticated as
specified in the applicable Securities Agreement and deliv-
ered against payment of the consideration therefor in
accordance with this Agreement, any Underwritten Securities
constituting capital stock of the Company will be validly
issued and fully paid and non-assessable and any other Un-
derwritten Securities will be valid and binding obligations
of the Company, in each case entitled to the benefits of
the applicable Securities Agreement and enforceable in
accordance with their terms, except as enforcement thereof
may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting
creditors' rights generally or by general equitable princi-
ples (regardless of whether enforcement is considered in a
proceeding in equity or at law) and except further as en-
forcement thereof may be limited by (A) requirements that a
claim with respect to any Underwritten Securities denomi-
nated other than in U.S. dollars (or a foreign currency or
currency unit judgment in respect of such claim) be
converted into U.S. dollars at a rate of exchange pre-
vailing on a date determined pursuant to applicable law or
(B) governmental authority to limit, delay or prohibit the
making of payments outside the United States; and the
Warrant Securities, if any, have been duly authorized by
the Company and, when executed and authenticated as
specified in the applicable Securities Agreement and
delivered against payment pursuant to such Securities
Agreement, any Warrant Securities constituting capital
stock of the Company will be validly issued and fully paid
and non-assessable and any other Warrant Securities will be
valid and binding obligations of the Company, in each case
entitled to the benefits of the applicable Securities
Agreement and enforceable in accordance with their terms,
except as enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar
laws relating to or affecting creditors' rights generally
or general equitable principles (regardless or whether
enforcement is considered in a proceeding in equity or at
law) and except further as enforcement thereof is subject,
in the case of Warrant Securities denominated in a foreign
currency or currency unit, to provisions of law that re-
quire that a judgment for money damages rendered by a court
in the United States be expressed only in United States
dollars.
(viii) The applicable Securities Agreement has been
duly authorized, executed and delivered by the Company and,
in the case of any Certificate of Designation, has been
filed with the Secretary of State of the State of Delaware
and, in the case of any Indenture, has been duly qualified
under the 1939 Act, and, assuming due authorization, execu-
tion and delivery by the Trustee, in the case of the Inden-
ture, and the Warrant Agent, in the case of any Warrant
Agreement, constitutes a valid and binding obligation of
the Company, enforceable in accordance with its terms, ex-
cept as enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar
laws relating to or affecting creditors' rights generally
or by general equitable principles (regardless of whether
enforcement is considered in a proceeding in equity or at
law) and except further as enforcement thereof is subject,
in the case of Underwritten Securities denominated in a
foreign currency or currency unit, to provisions of law
that require that a judgment for money damages rendered by
a court in the United States be expressed only in United
States dollars.
(ix) The Underwritten Securities and the applicable
Securities Agreement conform in all material respects to
the descriptions thereof contained in the Prospectus and
are substantially in the respective forms filed or
incorporated by reference, as the case may be, as exhibits
to the Registration Statement; and the issuance of the
Underwritten Securities is not subject to any preemptive or
similar rights.
(x) The Registration Statement is effective under the
1933 Act and, to the best of their knowledge and
information, no stop order suspending the effectiveness of
the Registration Statement has been issued under the 1933
Act or proceedings therefor initiated or threatened by the
Commission.
(xi) At the time the Registration Statement became
effective and at the Representation Date, the Registration
Statement and each amendment or supplement thereto (other
than the financial statements and supporting schedules in-
cluded therein and the Form T-1 of the Trustee under the
Indenture, as to which such counsel need express no opin-
ion), complied as to form in all material respects to the
requirements of the 1933 Act, the 1933 Act Regulations, the
1939 Act and the 1939 Act Regulations.
(xii) Each document filed pursuant to the 1934 Act
(other than the financial statements and supporting
schedules included therein, as to which such counsel need
express no opinion) and incorporated or deemed to be
incorporated by reference in the Prospectus complied when
so filed as to form in all material respects with the 1934
Act and the 1934 Act Regulations.
(xiii) There are no contracts, indentures, mortgages,
loan agreements, notes, leases or other agreements or in-
struments required to be described or referred to in the
Registration Statement or to be filed as Exhibits thereto
other than those described or referred to therein or filed
or incorporated by reference as exhibits thereto and the
descriptions thereof are correct, and, to the knowledge of
such counsel, no default exists in the due performance or
observance of any obligation, agreement, covenant or condi-
tion contained in any contract, indenture, mortgage, loan
agreement, note, lease or other agreement or instrument so
described, referred to, filed or incorporated by reference,
except where such default would not have a Material Adverse
Effect.
(xiv) No authorization, approval, consent or order of
any court or governmental authority or agency is required
in connection with the sale to the Underwriters of the
Underwritten Securities, except such as may be required
under the 1933 Act or the 1933 Act Regulations or state
securities laws; and the execution, delivery and perfor-
xxxxx of this Agreement, the applicable Securities
Agreement and the Securities and the consummation of the
transactions contemplated herein and therein will not con-
flict with or constitute a breach of, or a default
under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the
Company or any of its Significant Subsidiaries pursuant to,
any material contract, indenture, mortgage, loan agreement,
note, lease or other agreement or instrument to which the
Company or any of its Significant Subsidiaries is a party
or by which any of them may be bound, or to which any of
the property or assets of the Company or any of its Signif-
icant Subsidiaries is subject, nor will such action result
in any violation of the provisions of the charter or by-
laws of the Company or any of its Significant Subsidiaries,
or any applicable law, administrative regulation or
administrative or court decree.
(xv) To the knowledge of such counsel, there are no
legal or governmental proceedings pending or threatened
that are required to be disclosed in the Registration
Statement, other than those disclosed therein, and all
pending legal or governmental proceedings to which the
Company or any of its subsidiaries is a party or to which
any of their property is subject which are not described in
the Registration Statement, including ordinary routine
litigation incidental to the business, are, considered in
the aggregate, not material.
(xvi) The information in the Prospectus under
"Description of Debt Securities," "Description of Debt War-
rants," "Description of Preferred Stock," "Description of
Preferred Warrants" and "Description of Currency Warrants,"
to the extent that it constitutes matters of law, summaries
of legal matters, documents or proceedings, or legal
conclusions, has been reviewed by such counsel and is cor-
rect in all material respects.
(xvii) Neither the Company nor any of its
subsidiaries is, or as a result of the transactions
contemplated by the Prospectus or the applicable Securities
Agreement would be, required to make any filing or to
register under the Investment Company Act of 1940, as
amended.
(2) The favorable opinion, dated as of the applicable
Closing Time, of Skadden, Arps, Slate, Xxxxxxx & Xxxx, counsel
for the Underwriters, with respect to the matters set forth in
(i)(b) (other than with respect to any of the Company's
subsidiaries, as to which such counsel need express no opinion),
and (vi), (vii), (viii), (x), (xi) and (xvi).
(3) In giving her opinion required by clauses (i)-(xvii)
of subsection (b)(1) of this Section 4, the General Counsel of
the Company may rely, as to matters of fact, to the extent such
counsel deems proper, on certificates of responsible officers of
the Company and public officials, provided that copies of any
such certificates are delivered to the Representative and coun-
sel for the Representative, and, as to matters involving the
application of laws of any jurisdiction other than the United
States and jurisdictions in which such counsel is admitted, to
the extent such counsel deems proper and specifies in such
opinion and to the extent such opinion is satisfactory in form
and scope to counsel for the Representative, upon the opinion of
other counsel qualified in such jurisdictions whom such counsel
believes are reliable and who are satisfactory to counsel for
the Representative, provided that copies of any such opinions of
other counsel shall be delivered to the Representative and coun-
sel for the Representative.
In giving the opinions required by subsections (b)(1) and
(b)(2) of this Section 4, each such counsel shall state that no
facts have come to such counsel's attention that lead such
counsel to believe (i) that the Registration Statement or any
amendment thereto (except for the financial statements and sup-
porting schedules and other financial or statistical data in-
cluded or incorporated by reference therein and the Form T-1 of
the Trustee under the Indenture, as to which such counsel need
make no statement), at the time the Registration Statement or
any such amendment became effective, or at the date of the Terms
Agreement, contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading or
(ii) that the Prospectus or any amendment or supplement thereto
(except for the financial statements and supporting schedules
and other financial or statistical data included or incorporated
by reference therein, as to which such counsel need make no
statement), at the time the Prospectus was issued, at the time
any such amended or supplemented Prospectus was issued or at the
applicable Closing Time, included or includes an untrue state-
ment of a material fact or omitted or omits to state a material
fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not mis-
leading.
(c) At the applicable Closing Time, there shall not have been,
since the date of the Terms Agreement or since the respective dates
as of which information is given in the Registration Statement, any
Material Adverse Change, and the Representative shall have received a
certificate of the President or a Vice President of the Company and
of the chief financial or chief accounting officer of the Company,
dated as of such Closing Time, to the effect that (i) there has been
no such Material Adverse Change, (ii) the other representations and
warranties of the Company contained in Section 1 hereof are true and
correct with the same force and effect as though such Closing Time
were a Representation Date, (iii) the Company has complied in all
material respects with all agreements and satisfied all conditions on
its part to be performed or satisfied at or prior to the Closing Time
and (iv) no stop order suspending the effectiveness of the Registra-
tion Statement has been issued and, to the knowledge of such
officers, no proceedings for that purpose have been initiated or
threatened by the Commission.
(d) The Representative shall have received from Xxxxxx Xxxxxxxx
LLP or other independent public accountants acceptable to the
Representative a letter, dated as of the date of the Terms Agreement
and delivered at such time, in form and substance satisfactory to the
Representative, to the effect that (i) they are independent public
accountants with respect to the Company and its subsidiaries within
the meaning of the 1933 Act and the 1933 Act Regulations; (ii) it is
their opinion that the audited consolidated financial statements and
supporting schedules included or incorporated in the Registration
Statement and the Prospectus and covered by their opinions comply as
to form in all material respects with the applicable accounting
requirements of the 1933 Act and the 1933 Act Regulations and the
1934 Act and 1934 Act Regulations; (iii) they have read the unaudited
condensed consolidated interim balance sheet, statements of income,
stockholders' equity and cash flows included or incorporated in the
Registration Statement, and agreed the amounts contained therein with
the Company's accounting records as of such date or for such period,
and inquired of certain officials of the Company who have
responsibility for financial and reporting matters as to whether such
interim financial statements included or incorporated in the
Registration Statement are in conformity with generally accepted
accounting principles applied on a basis substantially consistent
with that of the audited consolidated financial statements included
or incorporated in the Registration Statement and comply as to form
in all material respects with the applicable accounting requirements
of the 1933 Act and the 1933 Act Regulations; (iv) based upon limited
procedures set forth in detail in such letter, nothing has come to
their attention which causes them to believe that (A) any unaudited
interim consolidated financial statements of the Company included or
incorporated in the Registration Statement and the Prospectus do not
comply as to form in all material respects with the applicable ac-
counting requirements of the 1933 Act and the 1933 Act Regulations
and the 1934 Act and 1934 Act Regulations or are not in conformity
with generally accepted accounting principles applied on a basis sub-
stantially consistent with that of the audited consolidated financial
statements of the Company included or incorporated by reference in
the Registration Statement and the Prospectus, (B) at the date of the
latest available consolidated balance sheet read by such accountants,
and at a specified date not more than five days prior to the date of
this Agreement, there has been any change in the capital stock of the
Company and its subsidiaries (other than issuances of capital stock
in the ordinary course of business pursuant to employee benefit plans
of the Company) or any increase in the consolidated long-term debt or
material increase in the consolidated short-term debt of the Company
and its subsidiaries or any decrease in consolidated net current
assets or net assets, as compared with the amounts shown in the
latest balance sheet included in the Registration Statement or,
during the period from the closing date of the latest income
statement included in the Prospectus to a specified date not more
than five days prior to the date of this Agreement, there were any
decreases, as compared with the corresponding period in the preceding
year, in consolidated revenues, net income or net income per share of
the Company and its subsidiaries, except in all instances for
changes, increases or decreases which the Registration Statement and
the Prospectus disclose have occurred or may occur; and (v) in addi-
tion to the examination referred to in their opinions and the limited
procedures referred to in clause (iv) above, they have carried out
certain specified procedures, not constituting an audit, with respect
to certain amounts, percentages and financial information which are
included in the Registration Statement and the Prospectus and which
are specified by the Representative, and have found such amounts,
percentages and financial information to be in agreement with the
relevant accounting, financial and other records of the Company and
its subsidiaries identified in such letter, excluding any questions
of legal interpretation.
(e) The Representative shall have received from Xxxxxx Xxxxxxxx
LLP or other independent public accountants acceptable to the
Representative a letter, dated as of the applicable Closing Time,
reconfirming or updating the letter required by subsection (d) of
this Section 4, in form and substance satisfactory to the Representa-
tive.
(f) At the applicable Closing Time, Skadden, Arps, Slate,
Xxxxxxx & Xxxx shall have been furnished with such documents and
opinions as they may reasonably require for the purpose of enabling
them to pass upon the issuance and sale of the Underwritten
Securities as herein contemplated and related proceedings or in order
to evidence the accuracy and completeness of any of the representa-
tions and warranties, or the fulfillment of any of the conditions,
herein contained; and all proceedings taken by the Company in
connection with the issuance and sale of the Underwritten Securities
as herein contemplated shall be reasonably satisfactory in form and
substance to the Representative and counsel for the Underwriters.
(g) In the event the Underwriters exercise
their option provided in a Terms Agreement as set forth in Section 2
hereof to purchase all or any portion of the Option Securities, the
representations and warranties of the Company contained herein and
the statements in any certificates furnished by the Company hereunder
shall be true and correct as of each Date of Delivery, and the
Representative shall have received:
(1) A certificate, dated such Date of
Delivery, of the President or a Vice President and of the chief
financial or chief accounting officer of the Company, confirming
that the certificate delivered at Closing Time pursuant to
Section 4(c) hereof remains true and correct as of such Date of
Delivery.
(2) The favorable opinion of Xxxxx X.
Xxxxxxxx, Vice President, Secretary and General Counsel of the
Company, in form and substance satisfactory to the
Representative, dated such Date of Delivery, relating to the
Option Securities and otherwise substantially to the same effect
as the opinion required by Section 4(b)(1) hereof.
(3) The favorable opinion of Skadden,
Arps, Slate, Xxxxxxx & Xxxx, counsel for the Underwriters, dated
such Date of Delivery, relating to the Option Securities and
otherwise to the same effect as of the opinion required by Sec-
tion 4(b)(2) hereof.
(4) A letter from Xxxxxx Xxxxxxxx LLP
or other independent public accountants acceptable to the Repre-
sentative, in form and substance satisfactory to the
Representative and dated such Date of Delivery, substantially
the same in scope and substance as the letter furnished to the
Representative pursuant to Section 4(e) hereof, except that the
"specified date" in the letter furnished pursuant to this
Section 4(g)(4) shall be a date not more than five days prior to
such Date of Delivery.
(h) At the Closing Time, if provided for in the applicable Terms
Agreement, the Underwritten Securities and any Warrant Securities
issuable upon exercise of the Underwritten Securities shall have been
approved for listing on such national securities exchange as desig-
nated by the Representative, subject to official notice of issuance.
If any condition specified in this Section 4 shall not have been ful-
filled when and as required to be fulfilled, this Agreement may be termi-
nated by the Representative by notice to the Company at any time at or
prior to the applicable Closing Time, and such termination shall be
without liability of any party to any other party except as provided in
Section 5.
SECTION 5. Payment of Expenses. The Company will pay all expenses
incident to the performance of its obligations under this Agreement,
including (i) the printing and filing of the Registration Statement as
originally filed and of all amendments thereto, the preliminary
prospectuses, the Prospectus, and any amendments or supplements thereto,
(ii) the preparation, issuance and delivery of the certificates for the
Underwritten Securities to the Underwriters and of certificates for any
Warrant Securities issuable upon exercise of Debt Warrants or Preferred
Warrants, (iii) the fees and disbursements of the Company's counsel and
accountants, (iv) the qualification of the Underwritten Securities and any
Warrant Securities issuable upon exercise of Debt Warrants or Preferred
Warrants under securities laws in accordance with the provisions of Sec-
tion 3(i) hereof, including filing fees and the fees and disbursements of
counsel for the Underwriters in connection therewith and in connection
with the preparation of any Blue Sky Surveys and Legal Investment Surveys,
(v) the printing and delivery to the Underwriters in quantities as herein-
above stated of copies of the Registration Statement as originally filed
and of each amendment thereto, and of the Prospectus and any amendments or
supplements thereto, (vi) the printing and delivery to the Underwriters of
copies of each Securities Agreement, any Blue Sky Surveys, any Delayed
Delivery Contract and any Legal Investment Surveys, (vii) the fees, if
any, of rating agencies, (viii) the fees and expenses, if any, incurred in
connection with the listing of the Underwritten Securities or any Warrant
Securities on any national securities exchange, (ix) any filing fees inci-
dent to any required review by the National Association of Securities
Dealers, Inc. of the terms of the sale of the Securities (including the
reasonable fees, disbursements and charges of counsel for the Underwriters
in connection therewith), (x) the fees and expenses of any Trustee and
any agent of any Trustee, the fees and expenses of any Warrant Agent, and
the fees and disbursements of counsel for any Trustee or any Warrant Agent
in connection with any Securities Agreement and the Securities, (xi) any
advertising and other out-of-pocket expenses of the Representative in-
curred with the approval of the Company, (xii) the fees and expenses of
any Depository (as defined in any Securities Agreement) and any nominees
thereof in connection with the Underwritten Securities, (xiii) the cost of
providing any CUSIP or other identification numbers for the Underwritten
Securities, and (xiv) all other costs and expenses incident to the perfor-
xxxxx of its obligations hereunder which are not otherwise specifically
provided for in this Section 5.
If this Agreement is terminated by the Representative in accordance
with the provisions of Section 4 or Section 9(a)(i) hereof, the Company
shall reimburse the Underwriters named in such Terms Agreement for all of
their out-of-pocket expenses, including the reasonable fees and disburse-
ments of counsel for the Underwriters.
SECTION 6. Indemnification. (a) The Company agrees to indemnify and
hold harmless each Underwriter, its directors, officers and employees and
each person, if any, who controls any Underwriter within the meaning of
Section 15 of the 1933 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement
or alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the
information deemed to be part of the Registration Statement pursuant
to Rule 430A(b) of the 1933 Act Regulations, if applicable, or any
omission or alleged omission therefrom of a material fact required to
be stated therein or necessary to make the statements therein not
misleading or arising out of any untrue statement or alleged untrue
statement of a material fact contained in any Preliminary Prospectus
Supplement or the Prospectus (or any amendment or supplement thereto)
or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate
amount paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threat-
ened, or of any claim whatsoever based upon any such untrue statement
or omission, or any such alleged untrue statement or omission, if
such settlement is effected with the written consent of the Company;
and
(iii) against any and all expense whatsoever, as incurred
(including, subject to Section 6(c) hereof, the fees and
disbursements of counsel chosen by the Representative), reasonably
incurred in investigating, preparing or defending against any litiga-
tion, or any investigation or proceeding by any governmental agency
or body, commenced or threatened, or any claim whatsoever based upon
any such untrue statement or omission, or any such alleged untrue
statement or omission, to the extent that any such expense is not
paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any
loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue statement or omission made
in reliance upon and in conformity with written information furnished to
the Company by any Underwriter through the Representative expressly for
use in the Registration Statement (or any amendment thereto), any
Preliminary Prospectus Supplement, the Prospectus (or any amendment or
supplement thereto) or in the Form T-1 of the Trustee under the Indenture.
(b) Each Underwriter severally agrees to indemnify and hold harmless
the Company, its directors, each of its officers who signs the
Registration Statement and each person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act against any and all loss,
liability, claim, damage and expense described in subsection (a) of this
Section 6, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Regis-
tration Statement (or any amendment thereto), any Preliminary Prospectus
Supplement or the Prospectus (or any amendment or supplement thereto) in
reliance upon and in conformity with written information furnished to the
Company by such Underwriter through the Representative expressly for use
in the Registration Statement (or any amendment thereto), any Preliminary
Prospectus Supplement or the Prospectus (or any amendment or supplement
thereto).
(c) Each indemnified party shall give notice as promptly as
reasonably practicable to each indemnifying party of any action commenced
against it in respect of which indemnity may be sought hereunder, but
failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability which it may have otherwise than on
account of this indemnity agreement. An indemnifying party may
participate at its own expense in the defense of any such action. In no
event shall the indemnifying parties be liable for fees and expenses of
more than one counsel (in addition to any local counsel) separate from
their own counsel for all indemnified parties in connection with any one
action or separate but similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstance.
SECTION 7. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided
for in Section 6 hereof is for any reason held to be unenforceable by the
indemnified parties although applicable in accordance with its terms, the
Company and the Underwriters shall contribute to the aggregate losses,
liabilities, claims, damages and expenses of the nature contemplated by
said indemnity agreement incurred by the Company and one or more of the
Underwriters, as incurred, in such proportions that the Underwriters are
responsible for that portion represented by the percentage that the
underwriting discount appearing on the cover page of the Prospectus bears
to the initial public offering price appearing thereon and the Company is
responsible for the balance; provided, however, that no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
0000 Xxx) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. For purposes of this
Section, each person, if any, who controls an Underwriter within the
meaning of Section 15 of the 1933 Act shall have the same rights to
contribution as such Underwriter, and each director of the Company, each
officer of the Company who signed the Registration Statement, and each
person, if any, who controls the Company within the meaning of Section 15
of the 1933 Act shall have the same rights to contribution as the Company.
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in
this Agreement, or contained in certificates of officers of the Company
submitted pursuant hereto, shall remain operative and in full force and
effect, regardless of any investigation made by or on behalf of any
Underwriter or controlling person, or by or on behalf of the Company, and
shall survive delivery of any Underwritten Securities to the Underwriters.
SECTION 9. Termination. (a) The Representative may terminate this
Agreement, upon notice to the Company, at any time prior to the applicable
Closing Time (i) if there has been, since the date of the Terms Agreement
or since the respective dates as of which information is given in the
Registration Statement, any Material Adverse Change, or (ii) if there has
occurred any material adverse change in the financial markets in the
United States or elsewhere or any outbreak of hostilities or escalation
thereof or other calamity or crisis the effect of which is such as to make
it, in the judgment of the Representative, impracticable to market the
Underwritten Securities or enforce contracts for the sale of the Under-
written Securities, or (iii) if the rating assigned by any nationally
recognized securities rating agency to any securities of, or guaranteed
by, the Company or any of its subsidiaries shall have been lowered or if
any such rating agency shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating of
any securities of, or guaranteed by, the Company or any of its
subsidiaries, or (iv) if trading in the Common Stock has been suspended by
the Commission or a national securities exchange or if trading on either
the American Stock Exchange or the New York Stock Exchange has been
suspended, or minimum or maximum prices for trading have been fixed, or
maximum ranges for prices for securities have been required, by either of
said exchanges or by order of the Commission or any other governmental
authority, or if a banking moratorium has been declared by either Federal
or New York authorities.
(b) In the event of any such termination, (i) the covenants set
forth in Section 3 hereof with respect to any offering of Underwritten
Securities shall remain in effect so long as any Underwriter retains
beneficial ownership of any such Underwritten Securities purchased from
the Company pursuant to the applicable Terms Agreement and (ii) the cove-
nant set forth in Section 3(c) hereof, the provisions of Section 5 hereof,
the indemnity agreement set forth in Section 6 hereof, the contribution
provisions set forth in Section 7 hereof and the provisions of Sections 8
and 13 hereof shall remain in effect.
SECTION 10. Default by One or More of the Underwriters. If one or
more of the Underwriters participating in an offering of Securities shall
fail at the applicable Closing Time to purchase the Underwritten
Securities which it or they are obligated to purchase under the applicable
Terms Agreement (the "Defaulted Securities"), then the Representative
shall have the right, within 24 hours thereafter, to make arrangements for
one or more of the non-defaulting Underwriters, or any other underwriters,
to purchase all, but not less than all, of the Defaulted Securities in
such amounts as may be agreed upon and upon the terms herein set forth; if
however, the Representative shall not have completed such arrangements
within such 24-hour period, then:
(a) if the aggregate amount of Defaulted Securities does not
exceed 10% of the aggregate amount of the Underwritten Securities to
be purchased pursuant to the Terms Agreement, the non-defaulting
Underwriters named in such Terms Agreement shall be obligated to
purchase the full amount thereof in the proportions that their
respective underwriting obligations thereunder bear to the
underwriting obligations of all such non-defaulting Underwriters, or
(b) if the aggregate amount of Defaulted Securities exceeds 10%
of the aggregate amount of the Underwritten Securities to be pur-
chased pursuant to such Terms Agreement, the Terms Agreement shall
terminate without any liability on the part of any non-defaulting
Underwriters.
No action taken pursuant to this Section 10 shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of a default by any Underwriter or Underwriters as
set forth in this Section 10, either the Representative or the Company
shall have the right to postpone the applicable Closing Time for a period
not exceeding seven days in order to effect any required changes in the
Registration Statement or Prospectus or in any other documents or
arrangements.
SECTION 11. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed
or transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Representative, with a copy to
Skadden, Arps, Slate, Xxxxxxx & Xxxx, 000 Xxxx Xxxxxx Xxxxx, Xxxxx 0000,
Xxxxxxx, Xxxxxxxx 00000, Attention: Xxxxxxx X. Xxxxxx; notices to the
Company shall be directed to it at 2801-80th Street, Kenosha, Wisconsin
53141-1410, Attention: Xxxxx X. Xxxxxxxx, Vice President, Secretary and
General Counsel.
SECTION 12. Parties. This Agreement shall inure to the benefit of
and be binding upon the Company and any Underwriter who becomes a party
hereto, and their respective successors. Nothing expressed or mentioned
in this Agreement is intended or shall be construed to give any person,
firm or corporation, other than the Company, such Underwriters and their
respective successors and the controlling persons and officers and
directors referred to in Sections 6 and 7 hereof and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. This
Agreement and all conditions and provisions hereof are intended to be for
the sole and exclusive benefit of the Company, such Underwriters and their
respective successors and said controlling persons and officers and direc-
tors and their heirs and legal representatives, and for the benefit of no
other person, firm or corporation. No purchaser of Underwritten Secu-
rities from any Underwriter shall be deemed to be a successor by reason
merely of such purchase.
SECTION 13. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York applicable
to agreements made and to be performed in said State.
SECTION 14. Counterparts. The Terms Agreement may be executed in
one or more counterparts, and if executed in more than one counterpart,
the executed counterparts shall constitute a single instrument.
EXHIBIT A
SNAP-ON INCORPORATED
(a Delaware corporation)
[Title of Securities]
DELAYED DELIVERY CONTRACT
, 199
Snap-on Incorporated
0000-00xx Xxxxxx
Xxxxxxx, Xxxxxxxxx 00000-0000
Attention:
Ladies and Gentlemen:
The undersigned hereby agrees to purchase from Snap-on
Incorporated, a Delaware corporation (the "Company"), and the Company
agrees to sell to the undersigned on , 199 (the "Delivery
Date"),
of the Company's [insert title of security] (the "Securities"), offered by
the Company's Prospectus dated , 199 , as supplemented by its
Prospectus Supplement dated , 199 , receipt of which is hereby ac-
knowledged at a purchase price of ___________________ to the Delivery
Date, and on the further terms and conditions set forth in this contract.
Payment for the Securities which the undersigned has agreed to
purchase on the Delivery Date shall be made to the Company or its order by
certified or official bank check in New York Clearing House funds at the
office of
, on the Delivery Date, upon delivery to the
undersigned of the Securities to be purchased by the undersigned in
definitive form and in such denominations and registered in such names as
the undersigned may designate by written or telegraphic communication
addressed to the Company not less than five full business days prior to
the Delivery Date.
The obligation of the undersigned to take delivery of and make
payment for Securities on the Delivery Date shall be subject only to the
conditions that (1) the purchase of Securities to be made by the
undersigned shall not on the Delivery Date be prohibited under the laws of
the jurisdiction to which the undersigned is subject and (2) the Company,
on or before , 199 , shall have sold to the Underwriters of the
Securities (the "Underwriters") such amount of the Securities as is to be
sold to them pursuant to the Terms Agreement dated , 199
between the Company and the Underwriters. The obligation of the
undersigned to take delivery of and make payment for Securities shall not
be affected by the failure of any purchaser to take delivery of and make
payments for Securities pursuant to other contracts similar to this
contract. The undersigned represents and warrants to you that its
investment in the Securities is not, as of the date hereof, prohibited
under the laws of any jurisdiction to which the undersigned is subject and
which govern such investment.
Promptly after completion of the sale to the Underwriters, the
Company will mail or deliver to the undersigned at its address set forth
below notice to such effect, accompanied by a copy of the opinion of
counsel for the Company delivered to the Underwriters in connection
therewith.
By the execution hereof, the undersigned represents and warrants
to the Company that all necessary corporate action for the due execution
and delivery of this contract and the payment for and purchase of the
Securities has been taken by it and no further authorization or approval
of any governmental or other regulatory authority is required for such
execution, delivery, payment or purchase, and that, upon acceptance hereof
by the Company and mailing or delivery of a copy as provided below, this
contract will constitute a valid and binding agreement of the undersigned
in accordance with its terms.
This contract will inure to the benefit of and be binding upon
the parties hereto and their respective successors, but will not be
assignable by either party hereto without the written consent of the
other.
It is understood that the Company will not accept Delayed
Delivery Contracts for an amount of Securities in excess of __________ and
that the acceptance of any Delayed Delivery Contract is in the Company's
sole discretion and, without limiting the foregoing, need not be on a
first-come, first-served basis. If this contract is acceptable to the
Company, it is requested that the Company sign the form of acceptance on a
copy hereof and mail or deliver a signed copy hereof to the undersigned at
its address set forth below. This will become a binding contract between
the Company and the undersigned when such copy is so mailed or delivered.
This Agreement shall be governed by the laws of the State of New
York.
Yours very truly,
(Name of Purchaser)
By
(Title)
(Address)
Accepted as of the date
first above written.
SNAP-ON INCORPORATED
By________________________
(Title)
PURCHASER--PLEASE COMPLETE AT TIME OF SIGNING
The name and telephone number of the representative of the
Purchaser with whom details of delivery on the Delivery Date may be
discussed are as follows: (Please print)
Telephone No.
(including
Name Area Code)