CINCINNATI BELL INC. 8¾% SENIOR SUBORDINATED NOTES DUE 2018 UNDERWRITING AGREEMENT
Exhibit
1.1
CINCINNATI
XXXX INC.
8¾%
SENIOR SUBORDINATED NOTES DUE 2018
March
10, 2010
March 10,
2010
To the
Manager named in Schedule I hereto
for the
Underwriters named in Schedule II hereto
Ladies
and Gentlemen:
Cincinnati Xxxx Inc., an
Ohio corporation (the “Company”),
proposes to issue and sell to the several underwriters named in Schedule II
hereto (the “Underwriters”),
for whom you are acting as manager (the “Manager”),
the principal amount of its debt securities identified in Schedule I hereto
(the “Notes”),
to be issued under the indenture specified in Schedule I hereto (the “Indenture”)
between the Company, the Guarantors and the Trustee identified in such Schedule
(the “Trustee”). The
Notes will be fully and unconditionally guaranteed (the “Guarantees”)
on an unsecured senior subordinated basis by the Company’s subsidiaries listed
on Schedule III attached hereto (the “Guarantors”). The
Notes and the Guarantees are collectively referred to herein as the “Securities.” The
Company and the Guarantors to be party to the Indenture on the Closing Date (as
defined below) are referred to collectively as the “Issuers.”
The Company has filed with
the Securities and Exchange Commission (the “Commission”)
a registration statement, including a prospectus, (the file number of which is
set forth in Schedule I hereto) on Form S-3, relating to securities
(the “Shelf
Securities”), including the Securities, to be issued from time to time by
the Company. The registration statement as amended to the date of
this Agreement, including the information (if any) deemed to be part of the
registration statement at the time of effectiveness pursuant to Rule 430A
or Rule 430B under the Securities Act of 1933, as amended (the “Securities
Act”), is hereinafter referred to as the “Registration
Statement,” and the related prospectus covering the Shelf Securities
dated September 30, 2009 in the form first used to confirm sales of the
Securities (or in the form first made available to the Underwriters by the
Company to meet requests of purchasers pursuant to Rule 173 under the Securities
Act) is hereinafter referred to as the “Basic
Prospectus.” The Basic Prospectus, as supplemented by the
prospectus supplement specifically relating to the Securities in the form first
used to confirm sales of the Securities (or in the form first made available to
the Underwriters by the Company to meet requests of purchasers pursuant to Rule
173 under the Securities Act) is hereinafter referred to as the “Prospectus,”
and the term “preliminary
prospectus” means any preliminary form of the Prospectus. For
purposes of this Agreement, “free
writing prospectus” has the meaning set forth in Rule 405 under the
Securities Act, “Time
of Sale Prospectus” means the preliminary prospectus together with the
free writing prospectuses, if any, each identified in Schedule I hereto, and
“broadly
available road show” means a “bona fide electronic road show” as defined
in Rule 433(h)(5) under the Securities Act that has been made available without
restriction to any person. As used herein, the terms “Registration
Statement,” “Basic Prospectus,” “preliminary prospectus,” “Time of Sale
Prospectus” and “Prospectus” shall include the documents, if any, incorporated
by reference therein. The terms “supplement,”
“amendment,”
and “amend”
as used herein with respect to the Registration Statement, the Basic Prospectus,
the Time of Sale Prospectus, any preliminary prospectus or free writing
prospectus shall include all documents subsequently filed by the Company with
the Commission pursuant to the Securities Exchange Act of 1934, as amended (the
“Exchange
Act”), that are deemed to be incorporated by reference
therein. The term “Time
of Sale” means 5:00 p.m. on the date hereof, the time of the initial sale
of the Securities in connection with the offering when the Prospectus is not yet
available to prospective purchasers.
This offering, the Notes,
the Guarantees, this Agreement, the Indenture, the application of proceeds from
the offering and the transactions contemplated hereby or thereby are referred to
collectively as the “Transactions.”
1. Representations
and Warranties. The Company and the Guarantors, jointly and
severally, represent and warrant to and agree with each of the Underwriters
that:
(a) The
Registration Statement has become effective; no stop order suspending the
effectiveness of the Registration Statement is in effect, and no proceedings for
such purpose are pending before or threatened by the Commission. The
Company is a well-known seasoned issuer (as defined in Rule 405 under the
Securities Act) eligible to use the Registration Statement as an automatic shelf
registration statement and the Company has not received notice that the
Commission objects to the use of the Registration Statement as an automatic
shelf registration statement.
(b) (i)
Each document, if any, filed or to be filed pursuant to the Exchange Act and
incorporated by reference in the Time of Sale Prospectus or the Prospectus
complied or will comply when so filed in all material respects with the Exchange
Act and the applicable rules and regulations of the Commission thereunder, (ii)
each part of the Registration Statement, when such part became effective, did
not contain, and each such part, as amended or supplemented, if applicable, will
not contain any 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, (iii) the Registration Statement as of the date hereof does not
contain any 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, (iv) the Registration Statement and the Prospectus comply and, as
amended or supplemented, if applicable, will comply in all material respects
with the Securities Act and the applicable rules and regulations of the
Commission thereunder, (v) the Time of Sale Prospectus does not, and at the Time
of Sale and at the Closing Date (as defined in Section 4), the Time of Sale
Prospectus, as then amended or supplemented by the Company, if applicable, will
not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, (vi) each broadly available road
show, if any, when considered together with the Time of Sale Prospectus, does
not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading and (vii) the Prospectus does not
contain and, as amended or supplemented, if applicable, will not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading, except that the representations and warranties
set forth in this paragraph do not apply to (A) statements or
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omissions in the
Registration Statement, the Time of Sale Prospectus or the Prospectus based upon
information relating to any Underwriter furnished to the Company in writing by
such Underwriter through the Manager expressly for use therein or (B) that part
of the Registration Statement that constitutes the Statement of Eligibility
(Form T-1) under the Trust Indenture Act of 1939, as amended (the “Trust
Indenture Act”), of the Trustee.
(c) None
of the Issuers is an “ineligible issuer” in connection with the offering
pursuant to Rules 164, 405 and 433 under the Securities Act. Any free
writing prospectus that the Company is required to file pursuant to Rule 433(d)
under the Securities Act has been, or will be, filed with the Commission in
accordance with the requirements of the Securities Act and the applicable rules
and regulations of the Commission thereunder. Each free writing
prospectus that the Company has filed, or is required to file, pursuant to Rule
433(d) under the Securities Act or that was prepared by or behalf of or used or
referred to by the Company complies or will comply in all material respects with
the requirements of the Securities Act and the applicable rules and regulations
of the Commission thereunder. Except for the free writing
prospectuses, if any, identified in Schedule I hereto, and electronic road
shows, if any, each furnished to you before first use, the Company has not
prepared, used or referred to, and will not, without your prior consent,
prepare, use or refer to, any free writing prospectus.
(d) Each
of the Issuers and their respective Significant Subsidiaries (“Significant
Subsidiary” means any subsidiary that is a “significant subsidiary” of
the Company within the meaning of Rule 1-02 of Regulation S-X promulgated by the
Commission) (i) is either a corporation, a limited liability company or a
partnership duly organized, validly existing and in good standing (if
applicable) under the laws of its jurisdiction of organization and (ii) has full
corporate, limited liability company or partnership, as the case may be, power
and authority to enter into, execute, deliver, perform, make and consummate, as
the case may be, the Transactions to which it is a party. Each of the
Issuers (i) has full corporate, limited liability company or partnership, as the
case may be, power and authority to own, lease and operate its properties and to
conduct the businesses in which they are engaged and (ii) is duly qualified as a
foreign corporation, a foreign limited liability company or a foreign
partnership, as the case may be, to transact business and is in good standing
(if applicable) in each jurisdiction in which the nature of its business or the
ownership or leasing of its properties make such qualification necessary, except
where the failure to so qualify or to have such power and authority could not,
individually or in aggregate, reasonably be expected to have a Material Adverse
Effect.
“Material
Adverse Effect” means (A) a material adverse change in, or a material
adverse effect upon, the operations, business, properties, condition (financial
or otherwise) or prospects of the Company and its subsidiaries taken as a whole
or (B) the material impairment of the ability of any of the Company or any of
the Guarantors to consummate the Transactions to which it is a party and to
perform in any material respect its material obligations under any of the
documents related thereto.
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(e) This
Agreement has been duly authorized, executed and delivered by each Issuer and
constitutes a valid and legally binding agreement of each of the
Issuers.
(f) The
Indenture has been duly qualified under the Trust Indenture Act and has been
duly authorized by the Company and the Guarantors, and, at the Closing Date,
will have been duly executed and delivered by the Company and each such
Guarantor and will constitute valid and legally binding obligations of the
Company and each such Guarantor, each enforceable in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors’ rights and to general equity principles.
(g) The
Notes have been duly authorized by each of the Issuers; and when the Notes are
issued, executed and authenticated with the terms of the Indenture, the Notes
will be entitled to the benefits of the Indenture and will be the valid and
legally binding obligations of the Issuers, enforceable in accordance with their
terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors’ rights and to general equity principles.
(h) The
Guarantee to be endorsed on the Notes by each Guarantor has been duly authorized
by such Guarantors; and, when issued, will have been duly executed and delivered
by each such Guarantor and will conform in all material respects to the
description thereof contained in the Prospectus, as supplemented by any Free
Writing Prospectus. When the Notes have been issued, executed and
authenticated in accordance with the terms of the Indenture, the Guarantee of
each Guarantor endorsed thereon will constitute a valid and legally binding
obligation of such Guarantor, enforceable in accordance with its terms, subject
to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors’ rights
and to general equity principles.
(i) Each
of this Agreement, the Indenture and the Securities conforms or will conform, as
the case may be, in all material respects to the descriptions thereof contained
in the Prospectus, as supplemented by any Free Writing
Prospectuses.
(j) [reserved].
(k) Other
than as set forth in the Prospectus, as supplemented by any Free Writing
Prospectus, the issuance, entering into, execution, delivery, performance,
making and consummation, as the case may be, by each of the Issuers of the
Transactions to which it is a party will not (i) conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Issuers pursuant to any
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Issuers are a party or by which the Issuers are bound or
to which any of the property or assets of the Issuers is subject, (ii) result in
the violation of any provisions of the charter or by-laws (or similar
organization documents) of the
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Issuers, or (iii) result
in the violation of, or in the creation or imposition of any lien, charge or
encumbrances upon any property or assets of the Issuers pursuant to any
Applicable Law (as defined below) or any judgment, order or decree of any
Governmental Authority (as defined below) (including, without limitation, the
Federal Communications Commission (the “FCC”)
and any State regulatory agency) having jurisdiction over the Issuers or any of
their properties or assets, except in the case of clauses (i) and (iii) above,
as could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect; and no consent, approval, authorization or order of, or
filing or registration with, any such Governmental Authority (including, without
limitation, the FCC) under any such Applicable Law, judgment, order or decree is
required for the execution, delivery, performance, making and consummation, as
the case may be, of the Transactions to which any of the Issuers is a party, and
compliance by each of the Issuers with the terms thereof, except for such
consents, approvals, authorizations, filings, orders, registrations or
qualifications (A) which shall have been obtained or made prior to the Closing
Date or (B) the failure of which to be obtained or made could not, individually
or in the aggregate, reasonably be expected to have a Material Adverse
Effect.
“Applicable
Law” means all laws, statutes, rules, regulations and orders of, and
legally binding interpretations by, any Governmental Authority and judgments,
decrees, injunctions, writs, permits, orders or like governmental action of any
Governmental Authority applicable to any of the Issuers or any of their
properties, assets or operations, excluding Environmental Laws (as defined
below).
“Governmental
Authority” means any of (A) the government of the United States of
America or any State or other political subdivision thereof, (B) any government
or political subdivision of any other jurisdiction in which any of the Issuers
conducts all or any part of its business, or which properly asserts jurisdiction
over any properties of any of the Issuers, (C) any entity properly exercising
executive, legislative, judicial, regulatory or administrative functions of any
such government and (D) The New York Stock Exchange, Inc. (the “NYSE”).
(l) None
of the Company or any of its subsidiaries is (i) in violation of its charter or
by-laws (or similar organization documents), (ii) 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 property or assets is subject or (iii) in
violation in any respect of any Applicable Law or order or decree of any
Governmental Authority to which it or its property or assets are subject; except
for any violation under clauses (ii) and (iii) that could not, individually or
in the aggregate, reasonably be expect to have a Material Adverse
Effect.
(m) None
of the Company or any of its subsidiaries has sustained since December 31, 2009,
any material loss or material 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, other than
as set forth or contemplated in the Time of Sale Prospectus; and, since the
respective dates as of which information is given in the Time of Sale
Prospectus, there has not been any material
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change in the capital
stock or long-term debt of the Company (other than the issuance and sale of
Notes under this Agreement) or any material adverse change, or any development
involving a prospective material adverse change, in or affecting the condition
(financial or other), business, properties or results of operations of the
Company and its subsidiaries, taken as a whole, and, except as disclosed in or
contemplated by the Time of Sale Prospectus, there has been no dividend or
distribution of any kind declared, paid or made by the Company on any class of
its capital stock. This Section 1(m) shall not apply to
environmental matters, which are the subject of
Section 1(x).
(n) Other
than as set forth in the Time of Sale Prospectus, there are no legal or
administrative proceedings pending by or before any Person to which any of the
Issuers is a party or of which any business, property or assets of any of the
Issuers is the subject, or, to the knowledge of the Company, after due inquiry,
by which any business property or assets of any of the Issuers would reasonably
be expect to be affected, which, (i) if determined adversely to any of the
Issuers, could, individually or in the aggregate, reasonably be expected to
result in a Material Adverse Effect or (ii) would reasonably be expected to
question the validity or enforceability of any of this Agreement or any of the
Transactions or any action taken or to be taken or to be taken pursuant thereto;
and to the knowledge of the Company, no such proceedings are threatened or
contemplated.
(o) No
action has been taken and no Applicable Law or order has been enacted, adopted
or issued by any Governmental Authority which prevents the sale and issuance of
the Securities in any jurisdiction; no injunction, restraining order or order of
any nature by any Governmental Authority of competent jurisdiction has been
issued with respect to the Company or Guarantors which would prevent or suspend
the issuance or sale of the Securities; and no action, suit or proceeding is
pending against or, to the knowledge of the Company, threatened against or
affecting the Company, or any of its subsidiaries, by or before any Governmental
Authority which could reasonably be expected to interfere with or materially
adversely affect the issuance of the Securities or in any manner draw into
question the validity or enforceability of any of this Agreement of any of the
Transactions, or any action taken or to be taken pursuant
thereto.
(p) Except
as could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect, each of the Company and its subsidiaries possesses all
licenses, authorizations and permits issued by, and has made all declarations
and filings with, all appropriate Governmental Authorities which are necessary
for the ownership of their respective properties or the conduct of their
respective business as described in the Time of Sale Prospectus and neither the
Company nor any of its subsidiaries has received notification of any revocation
or modification or any such material license, authorization or
permit.
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(q) Each
preliminary prospectus filed as part of the registration statement as originally
filed or as part of any amendment thereto, or filed pursuant to Rule 424
under the Securities Act, complied when so filed in all material respects with
the Securities Act and the applicable rules and regulations of the Commission
thereunder.
(r) Each
of the Company and its subsidiaries has timely filed all federal, state, local
and foreign income and other tax returns and notices required to be filed by
applicable law, except where the failure to file such tax returns could not
reasonably be expected to have a Material Adverse Effect, and all such tax
returns were in all material respects true, correct and complete. No
audit, administrative proceedings or court proceedings are presently pending
with regard to any material potential federal, state, local or foreign tax of
any nature; the Company has no knowledge of any tax deficiencies which could
reasonably be expected to have a Material Adverse Effect. Each of the
Company and its subsidiaries has paid (within the time and in the manner
prescribed by law) all federal, state and local taxes of any nature which are
shown on its returns to be due, in each case except for those not yet delinquent
and those being contested in good faith by appropriate proceedings diligently
conducted for which the Company and/or each of its subsidiaries has established
on its books and records adequate reserves to pay all outstanding tax
liabilities in accordance with United States generally accepted accounting
principles (“GAAP”). None of the Company or any of its subsidiaries
has requested any extension of time within which to file any material tax
return, which return has not since been filed within the time period permitted
by such extension. The amounts currently set up as provisions for
taxes or otherwise by the Company and its subsidiaries on their books and
records are reasonably expected to be sufficient for the payment of all their
unpaid federal, state and local taxes accrued through the dates as of which they
speak, and for which each of the Company and its subsidiaries may be liable in
their own right, or as a transferee of, or as successor to any other
corporation, association, partnership, joint venture or other
entity.
(s) None
of the Issuers is an “investment company” or a company “controlled by” an
investment company within the meaning of the Investment Company Act of 1940, as
amended, and the rules and regulations of the Commission
thereunder.
(t) The
Company has an authorized capitalization as set forth in the Time of Sale
Prospectus, and all of the issued and outstanding shares of capital stock of the
Company have been duly and validly authorized and issued and are fully paid and
nonassessable and all of the issued equity interests of each subsidiary of the
Company (except for directors’ qualifying shares and except as otherwise set
forth in the Time of Sale Prospectus and except for certain immaterial
subsidiaries and except for the pledge of the equity or membership interests of
subsidiaries owned by the Company or a direct or indirect subsidiary of the
Company as security for the obligations of the holder thereof under the
Company’s existing credit facility) are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances, equities or
claims.
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(u) Each
of the Issuers has good and marketable title in fee simple to, or has valid
rights to lease or otherwise use, all items of real and personal property which
are material to the business of the Issuers, in the case of the Company free and
clear of all liens, encumbrances, claims and defects and imperfections of title
except such as (i) are described in the Time of Sale Prospectus, (ii) are
permitted liens under (and as defined in) the Indenture, or (iii) could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
(v) Except
as could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect, each of the Issuers has insurance or adequate reserves
covering their respective properties, operations, personnel and businesses,
which insurance or adequate reserves are in amounts as are, in the reasonable
judgment of the Company, adequate to protect the Issuers and their
businesses.
(w) Except
as could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect: (i) each of the Issuers owns or possesses adequate
rights to use all material 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; and (ii)
the conduct of the Issuers’ respective businesses do not conflict in any respect
with, and none of the Issuers has received any notice of any claim of conflict
with, any such rights of others.
(x) Other
than as set forth in the Time of Sale Prospectus and except as could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect: (i) there is not and has not been any presence, storage,
generation, transportation, handling, treatment, disposal, discharge, emission
or other release of any kind of Hazardous Materials (as defined below) by the
Company and its subsidiaries, or any other entity (including any predecessor)
for whose acts or omissions the Company and its subsidiaries is or may be liable
from, in, on, at, under, about or upon any property now or, during the period of
ownership, lease or operation by the Company and its subsidiaries, previously
owned, leased or operated by the Company or any of its subsidiaries, or upon any
other property, in violation of any Environmental Law or which would, under any
Environmental Law, give rise to any liability of the Company or any of its
subsidiaries; and (ii) there is not and has not been any presence, disposal,
discharge, emission or other release of any kind onto such property of any
Hazardous Materials with respect to which the Company has
knowledge.
“Environmental
Laws” means all applicable foreign, federal, state or local laws,
statutes, common law duties, rules, regulations, ordinances and codes, together
with all administrative orders, Environmental Permits (as defined below) of, and
legally-binding agreements with, any Governmental Authorities, in each case
relating to environmental, health, safety and land use matters (including,
without limitation the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, the Clean Air Act, the Federal Water Pollution Control
Act of 1972, the Solid Waste Disposal Act, and the Emergency Planning and
Community Right-to-Known Act).
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“Environmental
Permits” means all permits, licenses, registrations, consents and other
authorizations of any Governmental Authority which are required with respect to
any of the facilities of the Company or any of its subsidiaries or operations
under any applicable Environmental Laws.
“Hazardous
Materials” means (i) any petroleum or petroleum products, radioactive
materials, asbestos in any form that is friable, urea formaldehyde foam
insulation, polychlorinated biphenyls and radon gas; (ii) any chemicals,
materials or substances defined as or included in the definition of “hazardous
substances,” “hazardous waste,” “hazardous materials,” “extremely hazardous
substances,” “restricted hazardous waste,” “toxic substances,” “toxic
pollutants,” “contaminants,” or “pollutants,” or words of similar meaning and
effect, under any applicable Environmental Law; and (iii) any other chemical,
material or substance, the Release of which is prohibited, limited or regulated
by any Environmental Law.
(y) Except
as disclosed in the Time of Sale Prospectus, there are no contracts, agreements
or understandings between the Company or any Guarantor and any person granting
such person the right to require the Company or such Guarantor to file a
registration statement under the Securities Act with respect to any securities
of the Company or such Guarantor or to require the Company or such Guarantor to
include such securities with the Securities and Guarantees registered pursuant
to any registration statement.
(z) Deloitte
& Touche LLP, who have certified certain financial statements of the Company
and its subsidiaries, are independent public accountants as required by the
Securities Act and the rules and regulations of the Commission
thereunder.
(aa) Except
as disclosed in the Time of Sale Prospectus, (i) the historical financial
statements, including the related notes (collectively, the “Financial
Statements”), contained or incorporated by reference in the Time of Sale
Prospectus have been prepared in accordance with GAAP, consistently applied
throughout the periods covered thereby, and fairly present in all material
respects the financial position of the entities purported to be covered thereby
at the respective dates indicated and the results of their operations and their
cash flows for the respective periods indicated, subject, in the case of any
unaudited interim financial statements, to normal year-end adjustments, in each
case in accordance with GAAP, except as noted in the Financial Statements, and
(ii) the other financial, accounting and statistical information and data
related to the Company and its subsidiaries set forth or incorporated by
reference in the Time of Sale Prospectus present fairly, in all material
respects, the information purported to be shown thereby at the respective dates
and for the respective periods to which they apply, and except as disclosed
therein, have been prepared on a basis consistent with the Financial Statements
and the books and records of the entities as to which such information is
shown.
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(bb) None
of the Company or any of its subsidiaries is in default, and no waiver of
default is currently in effect, in the payment of the principal of or interest
on any material indebtedness of the Company or any such subsidiary and no event
or condition exists with respect to any indebtedness of the Company or any of
its subsidiaries that would permit (or that with notice, lapse of time or both,
would permit) any person to cause such indebtedness to become due and payable
before its stated maturity or before its regularly scheduled dates of
payment.
(cc) The
statements set forth in the Time of Sale Prospectus under the caption “Material
United States Federal Income Tax Considerations,” insofar as they purport to
describe the provisions of the laws and documents referred to therein, are in
each such case fair and accurate summaries or descriptions, as the case may be,
in all material respects.
(dd) The
Company and its subsidiaries and affiliates have conducted their businesses in
compliance with the Foreign Corrupt Practices Act (the “FCPA”) and have
instituted and maintain and will continue to maintain policies and procedures
designed to promote and achieve compliance with the FCPA and with the
representation and warranty contained herein.
(ee) No
forward-looking statement (within the meaning of Section 27A of the Securities
Act and Section 21E of the Exchange Act) contained in the Time of Sale
Prospectus has been made or reaffirmed without a reasonable basis or has been
disclosed other than in good faith.
(ff) Neither
the Company nor any of its subsidiaries nor any agent thereof acting on their
behalf has taken, and none of them will take, any action that would cause this
Agreement or the issuance or sale of the Securities to violate
Regulation T, Regulation U or Regulation X of the Board of
Governors of the Federal Reserve System.
(gg) No
“nationally recognized statistical rating organization,” as such term is defined
for purposes of Rule 436(g)(2) under the Securities Act, (i) has
imposed (or has informed any Issuer that it is considering imposing) any
condition (financial or otherwise) on an Issuer retaining any rating assigned to
any debt securities of such Issuer or (ii) has indicated to any Issuer that
it is considering (a) the downgrading, suspension, or withdrawal of, or any
review for a possible change that does not indicate the direction of the
possible change in, any rating so assigned or (b) any change in the outlook
for any rating on the debt securities of such Issuer.
(hh) On
the Closing Date, after giving effect to the offering and sale of the Securities
and the application of the proceeds thereof as described in the Time of Sale
Prospectus, (i) the fair value and present fair saleable value of the
assets of the Company and its subsidiaries on a going concern basis will exceed
the sum of its stated liabilities and identified contingent liabilities; and
(ii) each of the Company and its subsidiaries is not, nor will it be
(A) left with unreasonably small capital with which to carry on its
business as it is proposed to be conducted, (B) unable to pay its debts
(contingent or otherwise) as they mature or (C) otherwise
insolvent. In computing the amount of such contingent liabilities at
any time, it is intended that such liabilities will be computed at the amount
that, in the light of all the facts and circumstances existing at such time,
represent the amount that can reasonably be expected to become an actual or
matured liability.
10
(ii) The
Company (i) makes and keeps materially accurate books and records and
(ii) maintains internal accounting controls that provide reasonable
assurance that (A) transactions are executed in accordance with
management’s authorization, (B) transactions are recorded as necessary to permit
preparation of its financial statements and to maintain accountability for its
assets, (C) access to its assets is permitted only in accordance with
management’s authorization and (D) the reported accountability for its
assets is compared with existing assets at reasonable
intervals.
(jj) The
operations of the Company and its subsidiaries are and have been conducted at
all times in material compliance with all applicable financial recordkeeping and
reporting requirements, including those of the Bank Secrecy Act, as amended by
Title III of the Uniting and Strengthening America by Providing Appropriate
Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT
Act), and the applicable anti-money laundering statutes of jurisdictions where
the Company and its subsidiaries conduct business, the rules and regulations
thereunder and any related or similar rules, regulations or guidelines, issued,
administered or enforced by any governmental agency (collectively, the “Anti-Money
Laundering Laws”), and no action, suit or proceeding by or before any
court or governmental agency, authority or body or any arbitrator involving the
Company or any of its subsidiaries with respect to the Anti-Money Laundering
Laws is pending or, to the best knowledge of the Company,
threatened.
(kk) (i) The
Company represents that neither the Company nor any of its subsidiaries
(collectively, the “Entity”)
nor any director or executive officer of the Entity is an individual or entity
(“Person”)
that is, or is owned or controlled by a Person that is:
(A) the
subject of any sanctions administered or enforced by the U.S. Department of
Treasury’s Office of Foreign Assets Control (“OFAC”)
(collectively, “Sanctions”);
or
(B) located,
organized or resident in a country or territory that is the subject of Sanctions
(including, without limitation, Burma/Myanmar, Cuba, Iran, North Korea, Sudan
and Syria).
(ii) The
Entity represents and covenants that it will not use the proceeds of the
offering, or lend, contribute or otherwise make available such proceeds to any
subsidiary, joint venture partner or other Person:
11
(A) to
fund or facilitate any activities or business of or with any Person or in any
country or territory that, at the time of such funding or facilitation, is the
subject of Sanctions; or
(B) in
any other manner that will result in a violation of Sanctions by any Person
(including any Person participating in the offering, whether as underwriter,
advisor, investor or otherwise).
2. Agreements
to Sell and Purchase. The Company hereby agrees to sell to the
several Underwriters, and each Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees, severally and not jointly, to purchase from the
Company the respective principal amounts of Securities set forth in
Schedule II hereto opposite its name at the purchase price set forth in
Schedule I hereto.
3. Public
Offering. The Company is advised by you that the Underwriters
propose to make a public offering of their respective portions of the Securities
as soon after the Registration Statement and this Agreement have become
effective as in your judgment is advisable. The Company is further
advised by you that the Securities are to be offered to the public upon the
terms set forth in the Prospectus.
4. Payment
and Delivery. Payment for the Securities shall be made to the
Company in federal or other funds immediately available in New York City on the
closing date and time set forth in Schedule I hereto, or at such other time
on the same or such other date, not later than the fifth business day
thereafter, as may be designated in writing by you. The time and date
of such payment are hereinafter referred to as the “Closing
Date.”
Payment
for the Securities shall be made against delivery to you on the Closing Date for
the respective accounts of the several Underwriters of the Securities registered
in such names and in such denominations as you shall request in writing not
later than one full business day prior to the Closing Date, with any transfer
taxes payable in connection with the transfer of the Securities to the
Underwriters duly paid.
5. Conditions
to the Underwriters’ Obligations. The several obligations of
the Underwriters are subject to the following conditions:
(a) Subsequent
to the execution and delivery of this Agreement and prior to the Closing
Date:
(i) there shall
not have occurred any downgrading, nor shall any notice have been given of any
intended or potential downgrading or of any review for a possible change that
does not indicate the direction of the possible change, in the rating accorded
the Company or any of the securities of the Company or any of its subsidiaries
or in the rating outlook for the Company, in each case, by any “nationally
recognized statistical rating organization,” as such term is defined for
purposes of Rule 436(g)(2) under the Securities Act; and
12
(ii) there
shall not have occurred any change, or any development involving a prospective
change, in the condition, financial or otherwise, or in the earnings, business
or operations of the Company and its subsidiaries, taken as a whole, from that
set forth in the Time of Sale Prospectus as of the date of this Agreement that,
in your judgment, is material and adverse and that makes it, in your judgment,
impracticable to market the Securities on the terms and in the manner
contemplated in the Time of Sale Prospectus.
(b) The
Underwriters shall have received on the Closing Date a certificate, dated the
Closing Date and signed by an executive officer of the Company, to the effect
set forth in Section 5(a) above and to the effect that the representations
and warranties of the Company contained in this Agreement that are qualified by
materiality are true and correct as of the Closing Date and those not so
qualified are true and correct in all material respects as of the Closing Date
and that the Company has complied in all material respects with all of the
agreements and satisfied all of the conditions on its part to be performed or
satisfied hereunder on or before the Closing Date.
The officer signing and
delivering such certificate may rely upon the best of his or her knowledge as to
proceedings threatened.
(c) The
Underwriters shall have received on the Closing Date an opinion of Cravath,
Swaine & Xxxxx LLP, outside counsel for the Company, dated the Closing Date
in form and substance reasonably satisfactory to the Manager.
(d) The
Underwriters shall have received on the Closing Date an opinion from the Law
Offices of Xxxxxx X. Xxxxx, PLLC, Ohio counsel for the Company, dated
the Closing Date, in form and substance reasonably satisfactory to the
Manager.
(e) The
Underwriters shall have received on the Closing Date an opinion of Xxxxxx Xxxxxx
& Xxxxxxx LLP, counsel for the Underwriters, such opinion or opinions, dated
the Closing Date, with respect to the validity of the Securities, the Prospectus
and other related matters as the Manager may require, and the Company shall have
furnished to such counsel such documents as they request for the purpose of
enabling them to pass upon such matters.
(f) The
Underwriters shall have received such other documents, dated the Closing Date,
as they may reasonably request.
(g) The
Underwriters shall have received, on each of the date hereof and the Closing
Date, a letter dated the date hereof or the Closing Date, as the case may be, in
form and substance reasonably satisfactory to the Underwriters, from Deloitte
& Touche LLP, independent public accountants, containing statements and
information of the type ordinarily included in accountants’ “comfort letters” to
underwriters with respect to the financial statements and certain financial
information contained in the Registration Statement, the Time of Sale Prospectus
and the Prospectus; provided
that the letter delivered on the Closing Date shall use a “cut-off date” not
earlier than the date hereof.
13
6. Covenants
of the Company. The Company covenants with each Underwriter as
follows:
(a) To
furnish to you, without charge, a signed copy of the Registration Statement
(including exhibits thereto and documents incorporated by reference therein) and
deliver to each of the Underwriters during the period mentioned in
Section 6(e) or 6(f) below, as many copies of the Time of Sale Prospectus,
the Prospectus, any documents incorporated by reference therein and any
supplements and amendments thereto (but in the case of any such exhibits or
incorporated documents, only to the extent not filed with the Commission) or to
the Registration Statement as you may reasonably request.
(b) Before
amending or supplementing the Registration Statement during the period mentioned
in Section 6(e) or 6(f) below, the Time of Sale Prospectus or the
Prospectus, to furnish to you a copy of each such proposed amendment or
supplement and not to file any such proposed amendment or supplement to which
you reasonably object.
(c) To
furnish to you a copy of each proposed free writing prospectus to be prepared by
or on behalf of, used by, or referred to by the Company and not to use or refer
to any proposed free writing prospectus to which you reasonably object, in each
case with respect to the Notes being issued and sold
hereunder.
(d) Not
to take any action that would result in an Underwriter or the Company being
required to file with the Commission pursuant to Rule 433(d) under the
Securities Act a free writing prospectus prepared by or on behalf of the
Underwriter that the Underwriter otherwise would not have been required to file
thereunder, but for the action of the Company.
(e) If
the Time of Sale Prospectus is being used to solicit offers to buy the
Securities at a time when the Prospectus is not yet available to prospective
purchasers and any event shall occur or condition exist as a result of which it
is necessary to amend or supplement the Time of Sale Prospectus in order to make
the statements therein, in the light of the circumstances, not misleading, or if
any event shall occur or condition exist as a result of which the Time of Sale
Prospectus conflicts with the information contained in the Registration
Statement then on file, or if, in the opinion of counsel for the Underwriters,
it is necessary to amend or supplement the Time of Sale Prospectus to comply
with applicable law, forthwith to prepare, file with the Commission and furnish,
at its own expense, to the Underwriters and to any dealer upon request, either
amendments or supplements to the Time of Sale Prospectus so that, as applicable,
the statements in the Time of Sale Prospectus as so amended or supplemented will
not, in the light of the circumstances when the Time of Sale Prospectus is
delivered to a prospective purchaser, be misleading, the Time of Sale
Prospectus, as amended or supplemented, will no longer conflict with the
Registration Statement, or the Time of Sale Prospectus, as amended or
supplemented, will comply with applicable law.
14
(f) If,
during such period after the first date of the public offering of the Securities
as in the opinion of counsel for the Underwriters the Prospectus (or in lieu
thereof the notice referred to in Rule 173(a) of the Securities Act) is required
by law to be delivered in connection with sales by an Underwriter or dealer, any
event shall occur or condition exist as a result of which it is necessary to
amend or supplement the Prospectus in order to make the statements therein, in
the light of the circumstances when the Prospectus (or in lieu thereof the
notice referred to in Rule 173(a) of the Securities Act) is delivered to a
purchaser, not misleading, or if, in the opinion of counsel for the
Underwriters, it is necessary to amend or supplement the Prospectus to comply
with applicable law, forthwith to prepare, file with the Commission and furnish,
at its own expense, to the Underwriters and to the dealers (whose names and
addresses you will furnish to the Company) to which Securities may have been
sold by you on behalf of the Underwriters and to any other dealers upon request,
either amendments or supplements to the Prospectus so that the statements in the
Prospectus as so amended or supplemented will not, in the light of the
circumstances when the Prospectus (or in lieu thereof the notice referred to in
Rule 173(a) of the Securities Act) is delivered to a purchaser, be misleading or
so that the Prospectus, as amended or supplemented, will comply with applicable
law.
(g) To
endeavor to qualify the Securities for offer and sale under the securities or
Blue Sky laws of such jurisdictions as you shall reasonably
request.
(h) To
make generally available to the Company’s security holders and to you as soon as
practicable an earning statement covering a period of at least twelve months
beginning with the first fiscal quarter of the Company beginning after the date
of this Agreement which shall satisfy the provisions of Section 11(a) of
the Securities Act and the rules and regulations of the Commission
thereunder.
(i) Whether
or not the transactions contemplated in this Agreement are consummated or this
Agreement is terminated (other than a termination by the Underwriters where all
of the conditions set forth in Section 5 hereof have been satisfied; provided
that under no circumstances shall the Underwriters be required to reimburse the
Company for any of the Company’s costs or expenses), to pay or cause to be paid
all expenses incident to the performance of its obligations under this
Agreement, including: (i) the fees, disbursements and expenses of the
Company’s counsel and the Company’s accountants in connection with the
registration and delivery of the Securities under the Securities Act and all
other fees or expenses in connection with the preparation and filing of the
Registration Statement, any preliminary prospectus, the Time of Sale Prospectus,
the Prospectus, any free writing prospectus prepared by or on behalf of, used
by, or referred to by the Company and amendments and supplements to any of the
foregoing, including the filing fees payable to the Commission relating to the
Securities (within the time required by Rule 456 (b)(1), if applicable), all
printing costs associated therewith, and the mailing and delivering of copies
thereof to the Underwriters and dealers, in the quantities hereinabove
specified, (ii) all costs and expenses related to the transfer and delivery of
the Securities to the Underwriters, including any transfer or other taxes
payable thereon, (iii) the cost of printing or producing any Blue Sky or legal
15
investment
memorandum in connection with the offer and sale of the Securities under state
securities laws and all expenses in connection with the qualification of the
Securities for offer and sale under state securities laws as provided in
Section 6(g) hereof, including filing fees and the reasonable fees and
disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky or legal investment
memorandum, (iv) all filing fees and the reasonable fees and disbursements of
counsel to the Underwriters incurred in connection with the review and
qualification of the offering of the Securities by the Financial Industry
Regulatory Authority, (v) any fees charged by the rating agencies for the rating
of the Securities, (vi) the cost of the preparation, issuance and delivery of
the Securities, (vii) the costs and charges of any trustee, transfer agent,
registrar or depositary, (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 Securities, including, without limitation,
expenses associated with the preparation or dissemination of any electronic road
show and expenses associated with the production of road show slides and
graphics, (ix) the document production charges and expenses associated with
printing this Agreement and (x) all other costs and expenses incident to the
performance of the obligations of the Company hereunder for which provision is
not otherwise made in this Section. It is understood, however, that
except as provided in this Section, Section 8 entitled “Indemnity and
Contribution,” and the last paragraph of Section 10 below, the Underwriters
will pay all of their costs and expenses, including fees and disbursements of
their counsel, transfer taxes payable on resale of any of the Securities by them
and any advertising expenses connected with any offers they may make.
(j) If
the third anniversary of the initial effective date of the Registration
Statement occurs before all the Securities have been sold by the Underwriters,
prior to such third anniversary, to file a new shelf registration statement and
to take any other action necessary to permit the public offering of the
Securities to continue without interruption; references herein to the
Registration Statement shall include the new registration statement declared
effective by the Commission.
(k) During
the period beginning on the date hereof and continuing to and including the
Closing Date, not to offer, sell, contract to sell or otherwise dispose of any
debt securities of the Company or warrants to purchase or otherwise acquire debt
securities of the Company substantially similar to the Securities (other than
(i) the Securities, (ii) commercial paper issued in the ordinary course of
business or (iii) securities or warrants permitted with the prior written
consent of the Manager identified in Schedule I with the authorization to
release this lock-up on behalf of the Underwriters).
(l) To
prepare a final term sheet relating to the offering of the Securities,
containing only information that describes the final terms of the Securities or
the offering in a form consented to by the Manager, and to file such final term
sheet within the period required by Rule 433(d)(5)(ii) under the Securities Act
following the date the final terms have been established for the offering of the
Securities.
16
7. Covenants
of the Underwriters. Each Underwriter severally covenants with
the Company not to take any action that would result in the Company being
required to file with the Commission under Rule 433(d) a free writing prospectus
prepared by or on behalf of such Underwriter that otherwise would not be
required to be filed by the Company thereunder, but for the action of the
Underwriter.
8. Indemnity
and Contribution. (a) Each of Issuers jointly and
severally agrees to indemnify and hold harmless each Underwriter, each person,
if any, who controls any Underwriter within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act and
each affiliate of any Underwriter within the meaning of Rule 405 under the
Securities Act from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such
action or claim) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any amendment thereof,
any preliminary prospectus, the Time of Sale Prospectus, any issuer free writing
prospectus as defined in Rule 433(h) under the Securities Act, or the Prospectus
or any amendment or supplement thereto, or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, except insofar as such
losses, claims, damages or liabilities are caused by any such untrue statement
or omission or alleged untrue statement or omission based upon information
relating to any Underwriter furnished to the Company in writing by such
Underwriter through you expressly for use therein.
(b) Each
Underwriter agrees, severally and not jointly, to indemnify and hold harmless
each of the Issuers, its directors, its officers and each person, if any, who
controls any Issuer within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act to the same extent as the
foregoing indemnity from the Issuers to such Underwriter, but only with
reference to information relating to such Underwriter furnished to the Company
in writing by such Underwriter expressly for use in the Registration Statement,
any preliminary prospectus, the Time of Sale Prospectus, any issuer free writing
prospectus or the Prospectus or any amendment or supplement
thereto.
(c) In
case any proceeding (including any governmental investigation) shall be
instituted involving any person in respect of which indemnity may be sought
pursuant to Section 8(a) or (b), such person (the “indemnified
party”) shall promptly notify the person against whom such indemnity may
be sought (the “indemnifying
party”) in writing and the indemnifying party, upon request of the
indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, 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
17
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 the
fees and expenses of more than one separate firm (in addition to any local
counsel) for all such indemnified parties and that all such fees and expenses
shall be reimbursed as they are incurred. Such firm shall be
designated in writing by the Manager authorized to appoint counsel under this
Section set forth in Schedule I hereto, in the case of parties indemnified
pursuant to Section 8(a), and by the Company, in the case of parties
indemnified pursuant to Section 8(b). The indemnifying party
shall not be liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason of such
settlement or judgment. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of any
pending or threatened proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such proceeding.
(d) To
the extent the indemnification provided for in Section 8(a) or 8(b) is
unavailable to an indemnified party or insufficient in respect of any losses,
claims, damages or liabilities referred to therein, then each indemnifying party
under such paragraph, in lieu of indemnifying such indemnified party thereunder,
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages or liabilities (i) in such proportion as
is appropriate to reflect the relative benefits received by the Issuers on the
one hand and the Underwriters on the other hand from the offering of the
Securities or (ii) if the allocation provided by clause 8(d)(i) above is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause 8(d)(i) above but also
the relative fault of the Issuers on the one hand and of the Underwriters on the
other hand in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Issuers on the
one hand and the Underwriters on the other hand in connection with the offering
of the Securities shall be deemed to be in the same respective proportions as
the net proceeds from the offering of the Securities (before deducting expenses)
received by the Issuers and the total underwriting discounts and commissions
received by the Underwriters bear to the aggregate initial public offering price
of the Securities as set forth in the Prospectus. The relative fault
of the Issuers on the one hand and the Underwriters on the other hand 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 Issuers or by the
Underwriters and the parties’ relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The
Underwriters’ respective obligations to contribute pursuant to this
Section 8 are several in proportion to the respective principal amounts of
Securities they have purchased hereunder, and not joint.
18
(e) Each
of the Issuers and the Underwriters agree that it would not be just or equitable
if contribution pursuant to this Section 8 were determined by pro
rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in Section 8(d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in Section 8(d) shall be deemed
to include, subject to the limitations set forth above, 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 Section 8, no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the Securities underwritten by it and distributed to the public were offered to
the public exceeds the amount of any damages that such Underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The remedies provided for in this
Section 8 are not exclusive and shall not limit any rights or remedies
which may otherwise be available to any indemnified party at law or in
equity.
(f) The
indemnity and contribution provisions contained in this Section 8 and the
representations, warranties and other statements of the Issuers contained in
this Agreement shall remain operative and in full force and effect regardless of
(i) any termination of this Agreement, (ii) any investigation made by
or on behalf of any Underwriter, any person controlling any Underwriter or any
affiliate of any Underwriter or by or on behalf of each of the Issuers, its
officers or directors or any person controlling each of the Issuers and
(iii) acceptance of and payment for any of the
Securities.
9. Termination. The
Underwriters may terminate this Agreement by notice given by you to the Company,
if after the execution and delivery of this Agreement and prior to
the Closing Date (i) trading generally shall have been suspended or
materially limited on, or by, as the case may be, the New York Stock Exchange,
(ii) trading of any securities of the Company shall have been suspended on
any exchange or in any over-the-counter market, (iii) a material disruption
in securities settlement, payment or clearance services in the United States
shall have occurred, (iv) any moratorium on commercial banking activities
shall have been declared by federal or New York State authorities or
(v) there shall have occurred any outbreak or escalation of hostilities, or
any change in financial markets or any calamity or crisis that, in your
judgment, is material and adverse and which, singly or together with any other
event specified in this clause (v), makes it, in your judgment,
impracticable or inadvisable to proceed with the offer, sale or delivery of the
Securities on the terms and in the manner contemplated in the Time of Sale
Prospectus or the Prospectus.
10. Effectiveness;
Defaulting Underwriters. This Agreement shall become effective
upon the execution and delivery hereof by the parties hereto.
19
If, on the
Closing Date, any one or more of the Underwriters shall fail or refuse to
purchase the Securities that it has or they have agreed to purchase hereunder on
such date, and the aggregate principal amount of Securities which such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
is not more than one-tenth of the aggregate principal amount of the Securities
to be purchased on such date, the other Underwriters shall be obligated
severally in the proportions that the principal amount of Securities set forth
opposite their respective names in Schedule II bears to the aggregate
principal amount of Securities set forth opposite the names of all such
non-defaulting Underwriters, or in such other proportions as you may specify, to
purchase the Securities which such defaulting Underwriter or Underwriters agreed
but failed or refused to purchase on such date; provided
that in no event shall the principal amount of Securities that any Underwriter
has agreed to purchase pursuant to this Agreement be increased pursuant to this
Section 10 by an amount in excess of one-ninth of such principal amount of
Securities without the written consent of such Underwriter. If, on
the Closing Date, any Underwriter or Underwriters shall fail or refuse to
purchase Securities and the aggregate principal amount of Securities with
respect to which such default occurs is more than one-tenth of the aggregate
principal amount of Securities to be purchased on such date, and arrangements
satisfactory to you and the Company for the purchase of such Securities are not
made within 36 hours after such default, this Agreement shall terminate without
liability on the part of any non-defaulting Underwriter or the
Company. In any such case either you or the Company shall have the
right to postpone the Closing Date, but in no event for longer than seven days,
in order that the required changes, if any, in the Registration Statement, in
the Time of Sale Prospectus, in the Prospectus or in any other documents or
arrangements may be effected. Any action taken under this paragraph
shall not relieve any defaulting Underwriter from liability in respect of any
default of such Underwriter under this Agreement.
If this Agreement
shall be terminated by the Underwriters, or any of them, because of any failure
or refusal on the part of the Company to comply with the terms or to fulfill any
of the conditions of this Agreement, or if for any reason the Company shall be
unable to perform its obligations under this Agreement, the Company will
reimburse the Underwriters or such Underwriters as have so terminated this
Agreement with respect to themselves, severally, for all out-of-pocket expenses
(including the fees and disbursements of their counsel) reasonably incurred by
such Underwriters in connection with this Agreement or the offering contemplated
hereunder.
11. Entire
Agreement. (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
Securities, represents the entire agreement between the Issuers and the
Underwriters with respect to the preparation of any preliminary prospectus, the
Time of Sale Prospectus, the Prospectus, the conduct of the offering, and the
purchase and sale of the Securities.
(b) The Company
acknowledges that in connection with the offering of the
Securities: (i) the Underwriters have acted at arms length, are not
agents of, and owe no fiduciary duties to, the Issuers or any other person, (ii)
the Underwriters owe the Company only those duties and obligations set forth in
this Agreement and prior written agreements (to the extent not superseded by
this Agreement), if any, and (iii) the Underwriters may have interests that
differ from those of the Issuers. Each of the Issuers 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 Securities.
20
12. Counterparts. This
Agreement may be signed in two or more counterparts, each of which shall be an
original, with the same effect as if the signatures thereto and hereto were upon
the same instrument.
13. Applicable
Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York.
14. Headings. The
headings of the sections of this Agreement have been inserted for convenience of
reference only and shall not be deemed a part of this
Agreement.
15. Notices. All
communications hereunder shall be in writing and effective only upon receipt and
if to the Underwriters shall be delivered, mailed or sent to you at the address
set forth in Schedule I hereto; and if to the Company shall be delivered,
mailed or sent to the address set forth in Schedule I
hereto.
21
Very truly yours, | |||
CINCINNATI XXXX INC. | |||
|
By:
|
/s/ Xxxx Xxxxxxxxx | |
Name: Xxxx Xxxxxxxxx | |||
Title: Chief Financial Officer | |||
CINCINNATI
XXXX ENTERTAINMENT INC.
CINCINNATI
XXXX COMPLETE PROTECTION INC.
CINCINNATI
XXXX TELECOMMUNICATION SERVICES LLC BRCOM
INC.
CINCINNATI
XXXX TECHNOLOGY SOLUTIONS INC.
CINCINNATI
XXXX WIRELESS COMPANY
CINCINNATI
XXXX WIRELESS, LLC
CINCINNATI
XXXX SHARED SERVICES LLC
GRAMTEL
INC.
CBTS
SOFTWARE LLC
CINCINNATI
XXXX ANY DISTANCE INC.
IXC
INTERNET SERVICES, INC.
EVOLVE
BUSINESS SOLUTIONS LLC
CINCINNATI
XXXX ANY DISTANCE OF VIRGINIA LLC
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By:
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/s/ Xxxx Xxxxxxxxx | |
Name: Xxxx Xxxxxxxxx | |||
Title: Chief Financial Officer | |||
[Signature page to Underwriting Agreement]
22
Accepted
as of the date hereof
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BANC
OF AMERICA SECURITIES LLC
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Acting
severally on behalf of themselves and the several Underwriters named in
Schedule II hereto
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By:
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BANC
OF AMERICA SECURITIES LLC
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By:
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/s/ Xxxx Xxxx |
Name:
Xxxx Xxxx
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Title:
Managing Director
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[Signature page to Underwriting Agreement]
23
SCHEDULE
I
Manager:
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Banc
of America Securities LLC
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Indenture:
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Indenture
dated as of March 15, 2010, between the Company and the
Trustee
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Trustee:
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The
Bank of New York Mellon
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Registration
Statement File No.:
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333-162211 |
Time
of Sale Prospectus
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1.
Prospectus dated September 30, 2009 relating to the Shelf
Securities
2.
the preliminary prospectus supplement dated March 10, 2010, relating to
the Securities
3.
the free writing prospectus attached as Annex A
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Securities
to be purchased:
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8¾%
Senior Subordinated Notes due 2018
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Aggregate
Principal Amount:
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$625,000,000 |
Purchase
Price:
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96.596%
of the principal amount of the Securities, plus accrued interest, if any,
from March 15, 2010
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Maturity:
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March
15, 2018
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Interest
Rate:
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8.75%
per annum, accruing from March 15, 2010
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Interest
Payment Dates:
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March
15 and September 15 commencing September 15, 2010
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Closing
Date and Time:
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March
15, 2010 9
a.m.
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Closing
Location:
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Xxxxxx Xxxxxx &
Xxxxxxx LLP
00
Xxxx Xxxxxx
Xxx
Xxxx, Xxx Xxxx 00000
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Address
for Notices to Underwriters:
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Banc
of America Securities LLC
Xxx
Xxxxxx Xxxx
Xxx
Xxxx, Xxx Xxxx 00000
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Address
for Notices to the Company:
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Cincinnati
Xxxx Inc.
000
Xxxx Xxxxxx Xxxxxx
Xxxxxxxxxx,
Xxxx 00000
Attention: General
Counsel
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I-1
SCHEDULE
II
Underwriters
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Principal
Amount of Securities To Be Purchased
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|||
Banc
of America Securities LLC
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$212,500,000 | |||
Barclays
Capital Inc.
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$75,000,000 | |||
Deutsche
Bank Securities Inc.
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$75,000,000 | |||
Xxxxxx
Xxxxxxx & Co. Incorporated
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$75,000,000 | |||
RBS
Securities Inc.
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$75,000,000 | |||
Xxxxx
Fargo Securities, LLC
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$75,000,000 | |||
PNC
Capital Markets LLC
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$37,500,000 | |||
Total
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$ | 625,000,000 |
II-1
SCHEDULE
III
GUARANTORS
Cincinnati
Xxxx Entertainment Inc.
Cincinnati
Xxxx Complete Protection Inc.
Cincinnati
Xxxx Telecommunication Services LLC
BRCOM
Inc.
Cincinnati
Xxxx Technology Solutions Inc.
Cincinnati
Xxxx Wireless Company
Cincinnati
Xxxx Wireless, LLC
Cincinnati
Xxxx Shared Services LLC
GramTel
Inc.
CBTS
Software LLC
Cincinnati
Xxxx Any Distance Inc.
IXC
Internet Services, Inc.
eVolve
Business Solutions LLC
Cincinnati
Xxxx Any Distance of Virginia LLC
III-Schedule
A-1
ANNEX
A
Filed
pursuant to Rule 433
Free
Writing Prospectus dated March 10, 2010
Registration
Statement No. 333-162211
CINCINNATI
XXXX INC.
Pricing
Term Sheet – March 10, 2010
$625,000,000
8¾% Senior Subordinated Notes due 2018
The
following information, filed pursuant to Rule 433, supplements the Preliminary
Prospectus
Supplement
dated March 10, 2010, filed as part of Registration Statement
No. 333-162211
Issuer:
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Cincinnati
Xxxx Inc. (the "Company")
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Security:
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8¾%
Senior Subordinated Notes due 0000
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Xxxxxxxxx
Principal Amount Offered:
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$625,000,000,
which represents an increase of $225,000,000 from the preliminary
prospectus supplement.
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Principal
Amount per Note:
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$2,000
minimum, $1,000 increments
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Rating1:
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B2/B- |
Trade
Date:
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Xxxxx
00, 0000
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Xxxxxxxxxx
Date:
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March
15, 2010 (T + 3)
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Maturity:
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March
15, 2018
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Coupon
Payment Dates:
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March
15 and September 15 of each year, beginning September 15,
2010
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Coupon
Record Dates:
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March
1 and September 1
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________________
1 A securities
rating is not a recommendation to buy, sell or hold securities and should be
evaluated independently of any other rating. The rating is subject to revision
or withdrawal at any time by the assigning rating
organization.
Optional
Redemption:
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104.375%
on or after March 15, 2014;
102.188%
on or after March 15, 2015;
100.000%
on or after March 15, 2016.
Make
whole call (T+50) prior to March 15, 2014.
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Equity
Clawback:
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Up
to 35% until March 15, 2013 at 108.750%
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Coupon:
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8.750% |
Price
to Public:
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98.596% |
Yield
to Maturity:
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9.000% |
Gross
Spread (%):
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2.000% |
Net
Proceeds to the Company (before expenses)(%):
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96.596% |
Net
Proceeds to the Company (before expenses)($):
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$603,725,000 |
CUSIP:
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000000XX0
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ISIN:
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US171871AM82
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Joint
Bookrunning Managers
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Banc
of America Securities LLC
Barclays
Capital Inc.
Deutsche
Bank Securities Inc.
Xxxxxx
Xxxxxxx & Co. Incorporated
RBS
Securities Inc.
Xxxxx
Fargo Securities, LLC
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Co-Manager
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PNC
Capital Markets LLC
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Changes to the Preliminary Prospectus
Supplement:
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Use
of Proceeds:
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We
expect to receive net proceeds of approximately $602.8 million from the
sale of the notes to the underwriters, after deducting the underwriters’
discount, original issue discount and other offering expenses payable by
us. We intend to use the net proceeds from the sale of the notes to redeem
all of our outstanding 8 3/8% Senior Subordinated Notes due 2014,
including payment of accrued and unpaid interest thereon and the related
call premium, and for general corporate purposes.
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Ranking
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The
“Ranking” heading on p. S-2 of the preliminary prospectus supplement is
updated as follows:
The
notes and the note guarantees will be unsecured senior subordinated
obligations of the Issuer and the note guarantors, respectively, will rank
junior in right of payment to all of their existing and future senior
indebtedness, will rank equally in right of payment with all of their
existing and future senior subordinated indebtedness, will be senior in
right of payment to all of their existing and future subordinated
indebtedness and will be effectively subordinated to any of their existing
and future secured indebtedness to the extent of the value of the assets
securing such indebtedness.
The
notes and the note guarantees will also be effectively subordinated to all
existing and future obligations of the subsidiaries of the Issuer that are
not note guarantors.
After
giving effect to the offering of the notes and the transactions described
under “Use of Proceeds”, as of December 31, 2009, there would have been
outstanding:
●
$992.5 million in aggregate principal amount of senior indebtedness of the
Issuer, of which $244.9 million in aggregate principal amount would have
been secured indebtedness (excluding unused commitments under our senior
credit facilities);
● no
senior indebtedness of the note guarantors (excluding the guarantees of
our senior credit facilities, our 7% Senior Notes due 2015, our 71⁄4%
Senior Notes due 2023 and our 81⁄4% Senior Notes due 2017 and $116.8
million of capital leases and other debt);
● $302.1
million in aggregate principal amount of indebtedness of non-guarantor
subsidiaries effectively ranking senior to the notes and the note
guarantees to the extent of the value of the assets of such non-guarantor
subsidiaries;
●
$759.5 million in aggregate principal amount of senior subordinated
indebtedness of the Issuer (consisting of the notes offered hereby and
$134.5 million in aggregate principal amount of the Issuer’s senior
subordinated guarantee of Cincinnati Xxxx Telephone Company LLC’s 6.30%
Debentures due 2028);
●
no senior subordinated indebtedness of the note guarantors (excluding the
note guarantees);
●
$73.0 million in aggregate principal amount of subordinated indebtedness
of the Issuer (consisting of the Issuer’s subordinated guarantee of
Cincinnati Xxxx Telephone Company LLC’s medium term notes);
and
●
no subordinated indebtedness of the note
guarantors.
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The
information in this communication supersedes the information in the preliminary
prospectus supplement to the extent it is inconsistent with such
information. Before you invest, you should read the preliminary
prospectus supplement (including the documents incorporated by reference
therein) for more information concerning the Issuer and the Notes.
The
Company has previously filed a registration statement (including a prospectus)
on Form S-3 with the Securities and Exchange Commission (the "SEC") for the
offering to which this communication relates, which registration statement was
automatically effective on September 30, 2009. Before you invest, you
should read the prospectus supplement to the prospectus in that registration
statement and the other documents the Company has filed with the SEC for more
complete information about the Company and this offering. You may get
these documents for free by visiting XXXXX on the SEC website at xxx.xxx.xxx. Alternatively,
a copy of the prospectus supplement relating to this offering may also be
obtained by contacting Banc of America Securities LLC, Xxx Xxxxxx Xxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Prospectus Department.