Exhibit 1-a
SOUTHWESTERN XXXX TELEPHONE COMPANY
DEBT SECURITIES
FORM OF UNDERWRITING AGREEMENT
[Date]
To the Representative
named in Schedule I
hereto of the Underwriters
named in Schedule II hereto
Dear Sirs:
Southwestern Xxxx Telephone Company, a Missouri corporation (the
"Telephone Company" or "Company"), may issue and sell from time to time series
of its debt securities registered under the registration statement referred to
in Paragraph 1(a) hereof ("Securities" and, individually, "Security"). The
Securities will be issued under an Indenture, dated as of February 1, 1985, as
supplemented by a First Supplemental Indenture, dated as of June 1, 1991
(together, the "Indenture"), from the Telephone Company to The Bank of New York,
as Trustee, in one or more series, which series may vary as to interest rates,
maturities, redemption provisions and selling prices, with all such terms for
any particular series being determined at the time of sale. The Telephone
Company proposes to sell to the underwriters named in Schedule II hereto
("Underwriters") for whom you are acting as representative ("Representative") a
series of Securities, of the designation, with the terms and in the aggregate
principal amount specified in Schedule I hereto ("Underwritten Securities" and,
individually, "Underwritten Security").
1. The Telephone Company represents and warrants to, and agrees with,
the several Underwriters that:
(a) A registration statement on Form S-3 with respect to the
Securities has been prepared by the Telephone Company in conformity with
the requirements of the Securities Act of 1933, as amended ("Act" or
"Securities Act"), and the rules and regulations ("Rules and
Regulations") of the Securities and Exchange Commission ("Commission" or
"SEC") thereunder and has become effective. As used in this Agreement,
(i) "Registration Statement" means that registration statement, as
amended or supplemented to the date hereof (including all documents
incorporated therein by reference); (ii) "Preliminary Prospectus" means
each
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prospectus (including all documents incorporated therein by reference)
included in that Registration Statement, or amendments thereto or
supplements thereof, before it became effective under the Act, including
any prospectus filed with the Commission pursuant to Rule 424(a) of the
Rules and Regulations; (ii) "Basic Prospectus" means the prospectus
(including all documents incorporated therein by reference) included in
the Registration Statement; and (iv) "Prospectus" means the Basic
Prospectus, together with any prospectus amendment or supplement
(including in each case all documents incorporated therein by reference)
specifically relating to the Underwritten Securities, as filed with, or
mailed for filing to, the Commission pursuant to paragraph (b) or (c) of
Rule 424 of the Rules and Regulations. The Commission has not issued any
order preventing or suspending the use of the Prospectus.
(b) The Registration Statement and each Prospectus contain, and
(in the case of any amendment or supplement to any such document, or any
material incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being made)
will contain at all times during the period specified in Paragraph 8(c)
hereof, all statements which are required by the Act, the Securities
Exchange Act of 1934, as amended ("Exchange Act"), the Trust Indenture
Act of 1939, as amended ("Trust Indenture Act"), and the rules and
regulations of the Commission under such Acts; the Indenture, including
any amendments and supplements thereto, pursuant to which the
Underwritten Securities will be issued, will conform with the
requirements of the Trust Indenture Act and the rules and regulations of
the Commission thereunder, and the Registration Statement and the
Prospectus do not, and (in the case of any amendment or supplement to any
such document, or any material incorporated by reference in any such
document, filed with the Commission after the date as of which this
representation is being made) will not at any time during the period
specified in Paragraph 8(c) hereof, 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;
provided that the Telephone Company makes no representation or warranty
as to information contained in or omitted from the Registration Statement
or the Prospectus in reliance upon and in conformity with information
furnished in writing to the Telephone Company through the Representative
by or on behalf of any Underwriter specifically for use therein, or as to
any statements in or omissions from the Statement of Eligibility of the
Trustee under the Indenture.
(c) The Telephone Company is not in violation of its corporate
charter or bylaws or in default under any agreement, indenture or
instrument, the effect of which violation or default would be material to
the Telephone Company,
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the execution, delivery and performance of this Agreement and any Delayed
Delivery Contracts (as defined in Paragraph 3 hereof) and compliance by
the Telephone Company with the provisions of the Underwritten Securities
and the Indenture will not conflict with, result in the creation or
imposition of any lien, charge or encumbrance upon any of the assets of
the Telephone Company pursuant to the terms of, or constitute a default
under, any agreement, indenture or instrument, or result in a violation
of the corporate charter or bylaws of the Telephone Company or any order,
rule or regulation of any court or governmental agency having
jurisdiction over the Telephone Company; and except as required by the
Act, the Trust Indenture Act and applicable state securities laws, no
consent, authorization or order of, or filing or registration with, any
court or governmental agency is required for the execution, delivery and
performance of this Agreement, the Delayed Delivery Contract, if any, and
the Indenture.
(d) Except as described in or contemplated by the Registration
Statement and the Prospectus, there shall have not occurred any changes
or any development involving a prospective change, or affecting
particularly the business or properties of the Telephone Company or its
subsidiaries which materially impairs the investment quality of the
Underwritten Securities since the dates as of which information is given
in the Registration Statement and the Prospectus.
(e) On the Delivery Date (as defined in Paragraph 7 hereof), (i)
the Indenture will have been duly authorized, executed and delivered by
the Telephone Company and will constitute the legally binding obligation
of the Telephone Company, enforceable in accordance with its terms, (ii)
the Underwritten Securities will have been duly authorized and, upon
payment therefor as provided in this Agreement, will constitute legally
binding obligations of the Telephone Company entitled to the benefits of
the Indenture, and (iii) the Underwritten Securities and the Indenture
will conform to the descriptions thereof contained in the Prospectus.
(f) The Telephone Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the State of
Missouri, with full corporate power and authority to own its properties
and conduct its business as described in the Prospectus, and is duly
qualified to do business as a foreign corporation and is in good standing
under the laws of each jurisdiction which requires such qualification
wherein it owns or leases properties or conducts business, except where
the failure to so qualify would not have a material adverse effect on the
Telephone Company.
(g) Except as described in the Prospectus, there is no material
litigation or governmental proceeding pending or, to the knowledge of the
Telephone Company, threatened against the Telephone Company which is
reasonably expected to result in any material adverse change in the
financial condition, results of operations, business
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or prospects of the Telephone Company or which is required to be
disclosed in the Registration Statement.
(h) The financial statements filed as part of the Registration
Statement or included in any Preliminary Prospectus or the Prospectus
present, or (in the case of any amendment or supplement to any such
document, or any material incorporated by reference in any such document,
filed with the Commission after the date as of which this representation
is being made) will present at all times during the period specified in
Paragraph 8(c) hereof, fairly, the financial condition and results of
operations of the Telephone Company, at the dates and for the periods
indicated, and have been, and (in the case of any amendment or supplement
to any such document, or any material incorporated by reference in any
such document, filed with the Commission after the date as of which this
representation is being made) will be at all times during the period
specified in Paragraph 8(c) hereof, prepared in conformity with generally
accepted accounting principles applied on a consistent basis throughout
the periods involved (except as described in the notes thereto).
(i) The documents incorporated by reference into any Preliminary
Prospectus or the Prospectus have been, and (in the case of any amendment
or supplement to any such document, or any material incorporated by
reference in any such document, filed with the Commission after the date
as of which this representation is being made) will be, at all times
during the period specified in Paragraph 8(c) hereof, prepared by the
Telephone Company in conformity with the applicable requirements of the
Act and the Rules and Regulations and the Exchange Act and the rules and
regulations of the Commission thereunder and such documents have been, or
(in the case of any amendment or supplement to any such document, or any
material incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being made)
will be at all times during the period specified in Paragraph 8(c)
hereof, timely filed as required thereby.
(j) There are no contracts or other documents which are required
to be filed as exhibits to the Registration Statement by the Act or by
the Rules and Regulations, or which were required to be filed as exhibits
to any document incorporated by reference in the Prospectus by the
Exchange Act or the rules and regulations of the Commission thereunder,
which have not been filed as exhibits to the Registration Statement or to
such document or incorporated therein by reference as permitted by the
Rules and Regulations or the rules and regulations of the Commission
under the Exchange Act as required.
(k) No order, consent, approval, authorization, registration or
qualification of or with any governmental agency or body having
jurisdiction over the Telephone Company or any of its properties is
required for the issue and sale of the Underwritten Securities or the
consummation by the Telephone Company of the
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transactions contemplated by this Agreement or the Indenture, except such
as have been, or will have been prior to the Delivery Date, obtained
under the Act and the Trust Indenture Act and such consents, approvals,
authorizations, registrations or qualifications as may be required under
state securities or Blue Sky laws in connection with the purchase and
distribution of the Underwritten Securities by the Underwriters.
2. Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Telephone Company agrees to
sell to each Underwriter, severally and not jointly, and each Underwriter
agrees, severally and not jointly, to purchase from the Telephone Company, at
the purchase price and on the other terms set forth in Schedule I hereto, the
principal amount of the Underwritten Securities set forth opposite its name in
Schedule II hereto.
3. Any offer to purchase Underwritten Securities by institutional
investors solicited by the Underwriters for delayed delivery shall be made
pursuant to contracts substantially in the form of Exhibit A attached hereto,
with such changes therein as the Telephone Company and the Representative may
approve ("Delayed Delivery Contracts"). The Telephone Company shall have the
right, in its sole discretion, to approve or disapprove each such institutional
investor. Underwritten Securities which are subject to Delayed Delivery
Contracts are herein sometimes called "Delayed Delivery Underwritten Securities"
and Underwritten Securities which are not subject to Delayed Delivery Contracts
are herein sometimes called "Immediate Delivery Underwritten Securities."
Contemporaneously with the purchase on the Delivery Date by the
Underwriters of the Immediate Delivery Underwritten Securities pursuant to this
Agreement, the Telephone Company will pay to the Representative, for the account
of the Underwriters, the compensation specified in Schedule I hereto for
arranging the sale of Delayed Delivery Underwritten Securities. The Underwriters
shall have no responsibility with respect to the validity or performance of any
Delayed Delivery Contracts.
For the purpose of determining the principal amount of Immediate Delivery
Underwritten Securities to be purchased by each Underwriter, there shall be
deducted from the principal amount of Underwritten Securities to be purchased by
such Underwriter as set forth in Schedule II hereto that portion of the
aggregate principal amount of Delayed Delivery Underwritten Securities that the
principal amount of Underwritten Securities to be purchased by such Underwriter
as set forth in Schedule II hereto bears to the aggregate principal amount of
Underwritten Securities set forth therein to be purchased by all of the
Underwriters (in each case as adjusted by the Representative to avoid fractions
of the minimum principal amount in which the Underwritten Securities may be
issued), except to the extent that the Representative determines, in its
discretion, that such deduction shall be otherwise than in such proportion and
so advises the Company.
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4. [Reserved]
5. The Telephone Company shall not be obligated to deliver any
Underwritten Securities except upon payment for all Immediate Delivery
Underwritten Securities to be purchased pursuant to this Agreement as
hereinafter provided.
6. If any Underwriter defaults in the performance of its obligations
under this Agreement, the remaining non-defaulting Underwriters shall be
obligated to purchase the Immediate Delivery Underwritten Securities which the
defaulting Underwriter agreed but failed to purchase in the respective
proportions which the principal amount of Underwritten Securities set forth in
Schedule II hereto to be purchased by each remaining non-defaulting Underwriter
set forth therein bears to the aggregate principal amount of Underwritten
Securities set forth therein to be purchased by all the remaining non-defaulting
Underwriters; provided that the remaining non-defaulting Underwriters shall not
be obligated to purchase any Immediate Delivery Underwritten Securities if the
aggregate principal amount of Immediate Delivery Underwritten Securities which
the defaulting Underwriter or Underwriters agreed but failed to purchase exceeds
9.09% of the total principal amount of Underwritten Securities, and any
remaining non-defaulting Underwriter shall not be obligated to purchase more
than 110% of the principal amount of Underwritten Securities set forth in
Schedule II hereto to be purchased by it. If the foregoing maximums are
exceeded, the remaining non-defaulting Underwriters, or those other underwriters
satisfactory to the Representative who so agree, shall have the right, but shall
not be obligated, to purchase, in such proportion as may be agreed upon among
them, all the Immediate Delivery Underwritten Securities. If the remaining
Underwriters or other underwriters satisfactory to the Representative do not
elect to purchase the Immediate Delivery Underwritten Securities which the
defaulting Underwriter or Underwriters agreed but failed to purchase, this
Agreement shall terminate without liability on the part of any non-defaulting
Underwriter, or the Telephone Company, except that the Telephone Company will
continue to be liable for the payment of expenses as set forth in Paragraph 8(i)
hereof.
Nothing contained in this Paragraph 6 shall relieve a defaulting
Underwriter of any liability it may have to the Telephone Company for damages
caused by its default. If other Underwriters are obligated or agree to purchase
the Immediate Delivery Underwritten Securities of a defaulting or withdrawing
Underwriter, either the Representative or the Telephone Company may postpone the
Delivery Date for up to seven full business days in order to effect any changes
that in the opinion of the Telephone Company or the Representative may be
necessary in the Registration Statement, the Prospectus or in any other document
or arrangement.
7. Delivery of and payment for the Immediate Delivery Underwritten
Securities shall be made at such address, date and time as specified in Schedule
I hereto. This date and time are sometimes referred to as the "Delivery Date."
On the Delivery Date, the
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Telephone Company shall deliver the Immediate Delivery Underwritten Securities
to the Representative for the account of each Underwriter against payment to or
upon the order of the Telephone Company of the purchase price by wire transfer
of immediately available funds settled through the New York Clearing House or
such other Clearing House as is named in Schedule I. Time shall be of the
essence, and delivery at the time and place specified pursuant to this Agreement
is a further condition of the obligation of each Underwriter hereunder. Upon
delivery, the Immediate Delivery Underwritten Securities shall be in such form
or forms and in such denominations as may be set forth in Schedule I. Immediate
Delivery Underwritten Securities in registered form shall be in such authorized
denominations and registered in such names as the Representative shall request
in writing not less than two full business days prior to the Delivery Date. For
the purpose of expediting the checking and packaging of the Immediate Delivery
Underwritten Securities, the Telephone Company shall make the Immediate Delivery
Underwritten Securities available for inspection by the Representative in New
York, New York not later than 2:00 P.M., local time, on the business day prior
to the Delivery Date. For purposes of Rule 15c6-1 under the Exchange Act, the
Delivery Date (if later than the otherwise applicable settlement date) shall be
the date for payment of funds and delivery of securities for all the Immediate
Delivery Underwritten Securities sold pursuant to the offering, other than
Delayed Delivery Underwritten Securities for which payment of funds and delivery
of securities shall be as hereinafter provided.
8. The Telephone Company agrees with the several Underwriters:
(a) The Telephone Company will furnish promptly to the
Representative and to counsel for the Underwriters signed copies of the
Registration Statement as originally filed and each amendment and
supplement thereto filed prior to the date hereof and relating to or
covering the Underwritten Securities, and a copy of the Prospectus filed
with the Commission, including all documents incorporated therein by
reference and all consents and exhibits filed therewith;
(b) The Telephone Company will deliver promptly to the
Representative such reasonable number of the following documents as the
Representative may request: (i) conformed copies of the Registration
Statement (excluding exhibits other than the computation of the ratio of
earnings to fixed charges, the Indenture and this Agreement), (ii) the
Prospectus and (iii) any documents incorporated by reference in the
Prospectus;
(c) During any period when a Prospectus relating to the
Underwritten Securities is required by law to be delivered, the Telephone
Company will not file any amendment of the Registration Statement nor
will the Telephone Company file any amendment or supplement to the
Prospectus (except for (i) an amendment or supplement consisting solely
of the filing of a document under the Exchange Act or (ii) a supplement
relating to an offering of securities other than the Underwritten
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Securities), unless the Telephone Company has furnished you a copy of
such proposed amendment or supplement for your review prior to filing and
will not file any such proposed amendment or supplement to which you
reasonably object. Subject to the foregoing sentence, the Telephone
Company will cause the Prospectus and any amendment or supplement thereto
to be filed with the SEC as required pursuant to Rule 424 under the
Securities Act. The Telephone Company will promptly advise you (i) when
the Prospectus or any amendment or supplement thereto shall have been
filed with the SEC pursuant to Rule 424 under the Securities act, (ii)
when any amendment of the Registration Statement shall have become
effective, (iii) of any request by the SEC for any amendment of the
Registration Statement or amendment of or supplement to the Prospectus or
for any additional information, (iv) of the issuance by the SEC of any
stop order suspending the effectiveness of the Registration Statement or
the institution or threatening of any proceeding for that purpose and (v)
of the receipt by the Telephone Company of any notification with respect
to the suspension of the qualification of the Underwritten Securities for
sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose. The Telephone Company will promptly (upon
filing thereof) furnish you a copy of any amendment or supplement to the
Prospectus or Registration Statement not furnished to the Representative
for prior review pursuant to exception (i) or (ii) of the first sentence
of this paragraph 8(c). The Telephone Company will use its best efforts
to prevent the issuance of any such stop order and, if issued, to obtain
as soon as possible the withdrawal thereof.
(d) If, at any time when a prospectus relating to the
Underwritten Securities is required to be delivered under the Securities
Act, any event occurs as a result of which the Registration Statement, as
then amended, or the Prospectus, as then supplemented, would include any
untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it shall
be necessary to amend the Registration Statement or to supplement the
Prospectus to comply with the Securities Act or the Exchange Act or the
respective rules thereunder, the Telephone Company promptly will (i)
notify you of the happening of such event, (ii) prepare and file with the
SEC, subject to the first sentence of paragraph (c) of this Section 8, an
amendment or supplement which will correct such statement or omission or
an amendment or supplement which will effect such compliance and (iii)
will supply any such amended or supplemented Prospectus to you in such
quantities as the Representative may reasonably request.
(e) As soon as practicable, the Telephone Company will make
generally available to its security holders and to the Representative an
earnings statement or statements of the Telephone Company which will
satisfy the provisions of Section 11(a) of the Securities Act and Rule
158 under the Securities Act.
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(f) During a period of five years after the date hereof, the
Telephone Company will furnish to the Representative copies of all
reports and financial statements furnished by the Telephone Company to
each securities exchange on which securities issued by the Telephone
Company may be listed pursuant to requirements of or agreements with such
exchange or to the Commission pursuant to the Exchange Act or any rule or
regulation of the Commission thereunder.
(g) The Telephone Company will endeavor to qualify the
Underwritten Securities for sale under the laws of such jurisdiction as
you may designate and will maintain such qualifications in effect so long
as required for the distribution of the Underwritten Securities, provided
that in connection therewith the Telephone Company shall not be required
to qualify as a foreign corporation or take any action which would
subject it to general or unlimited service of process in any jurisdiction
where it is not now so subject.
(h) The Telephone Company will pay the costs incident to the
authorization, issuance and delivery of the Underwritten Securities and
any taxes payable in that connection; the costs incident to the
preparation, printing and filing under the Act of the Registration
Statement and any amendments, supplements and exhibits thereto; the costs
of distributing the Registration Statement as originally filed and each
amendment and post-effective amendment thereof (including exhibits), any
Preliminary Prospectus, the Prospectus and any documents incorporated by
reference in any of the foregoing documents; the costs of producing this
Agreement, the Delayed Delivery Contracts, if any, and the Indenture;
fees paid to rating agencies in connection with the rating of the
Securities, including the Underwritten Securities; the fees and expenses
of qualifying the Underwritten Securities under the securities laws of
the several jurisdictions as provided in this Paragraph and of preparing
and printing a Blue Sky Memorandum and a memorandum concerning the
legality of the Securities, including the Underwritten Securities, as an
investment (including fees of counsel to the Underwriters); and all other
costs and expenses incident to the performance of the Telephone Company's
obligations under this Agreement; provided that, except as provided in
this Paragraph and in Paragraph 12 hereof, the Underwriters shall pay
their own costs and expenses, including the fees and expenses of their
counsel, any transfer taxes on the Underwritten Securities which they may
sell and the expenses of advertising any offering of the Underwritten
Securities made by the Underwriters; and
(i) Until the termination of the offering of the Underwritten
Securities, to timely file all documents, and any amendments to
previously filed documents, required to be filed by the Company pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act.
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9. (a) The Telephone Company shall indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within
the meaning of the Act from and against any loss, claim, damage or
liability, joint or several, and any action in respect thereof, to which
that Underwriter or controlling person may become subject, under the Act
or otherwise, insofar as such loss, claim, damage, liability or action
arises out of, or is based upon, any untrue statement or alleged untrue
statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or arises out of, or is based
upon, the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein
not misleading, and shall reimburse each Underwriter and such controlling
person for any legal and other expenses reasonably incurred by that
Underwriter or controlling person in investigating or defending or
preparing to defend against any such loss, claim, damage, liability or
action as such expenses are incurred (but no more frequently than
annually); provided, however, that the Telephone Company shall not be
liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of, or is based upon, any untrue statement
or alleged untrue statement or omission or alleged omission made in any
Preliminary Prospectus, the Registration Statement or the Prospectus in
reliance upon and in conformity with written information furnished to the
Telephone Company through the Representative by or on behalf of any
Underwriter specifically for use therein. The foregoing indemnity
agreement is in addition to any liability which the Telephone Company may
otherwise have to any Underwriter or controlling person.
(b) Each Underwriter shall indemnify and hold harmless the
Telephone Company, each of their directors, each of their officers who
signed the Registration Statement and any person who controls the
Telephone Company, within the meaning of the Act from and against any
loss, claim, damage or liability, joint or several, and any action in
respect thereof, to which the Telephone Company, or any such director,
officer or controlling person may become subject, under the Act or
otherwise, insofar as such loss, claim, damage, liability or action
arises out of, or is based upon, any untrue statement or alleged untrue
statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or arises out of, or is based
upon, the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein
not misleading, but in each case only to the extent that the untrue
statement or alleged untrue statement or omission or alleged omission was
made in reliance upon and in conformity with information furnished in
writing to the Telephone Company through the Representative by or on
behalf of that Underwriter specifically for use therein, and shall
reimburse the Telephone Company for any legal and other expenses
reasonably incurred by the Telephone Company or any such director,
officer or controlling person in investigating or defending or preparing
to defend against any such loss, claim, damage, liability or action as
such expenses are
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incurred (but no more frequently that annually). The foregoing indemnity
agreement is in addition to any liability which any Underwriter may otherwise
have to the Telephone Company or any of its directors, officers or controlling
persons.
(c) Promptly after receipt by an indemnified party under this
Paragraph 9 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under this Paragraph 9, notify the
indemnifying party in writing of the claim or the commencement of that
action, provided that the failure to notify the indemnifying party shall
not relieve it from any liability which it may have to an indemnified
party otherwise than under Paragraph 9(a) or 9(b). If any such claim or
action shall be brought against an indemnified party, and it shall notify
the indemnifying party thereof, the indemnifying party shall be entitled
to participate therein, and, to the extent that it wishes, jointly with
any other similarly notified indemnifying party, to assume the defense
thereof with counsel satisfactory to the indemnified party. After notice
from the indemnifying party to the indemnified party of its election to
assume the defense of such claim or action, the indemnifying party shall
not be liable to the indemnified party under this Paragraph 9 for any
legal or other expenses subsequently incurred by the indemnified party in
connection with the defense thereof other than reasonable costs of
investigation. If the indemnifying party shall not elect to assume the
defense of such action, such indemnifying party will reimburse such
indemnified party for the reasonable fees and expenses of any counsel
retained by them. In the event that the parties to any such action
(including impleaded parties) include both the Telephone Company and one
or more Underwriters and either (i) the indemnifying party or parties and
indemnified party or parties mutually agree or (ii) representation of
both the indemnifying party or parties and the indemnified party or
parties by the same counsel is inappropriate under applicable standards
of professional conduct or in the opinion of such counsel due to actual
or potential differing interests between them, then the indemnifying
party shall not have the right to assume the defense of such action on
behalf of such indemnified party and will reimburse such indemnified
party for the reasonable fees and expenses of any counsel retained by
them and satisfactory to the indemnifying party, it being understood that
the indemnifying party shall not, 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 circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys
for all such indemnified parties, which firm shall be designated in
writing by the Representative in the case of an action in which one or
more Underwriters or controlling persons are indemnified parties and by
the Telephone Company in the case of an action in which the Telephone
Company or any of its directors, officers or controlling persons are
indemnified parties. The indemnifying party or parties shall not be
liable under this Agreement with respect to any settlement made by any
indemnified party or
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parties without prior written consent by the indemnifying party or
parties to such settlement.
(d) If the indemnification provided for in this Paragraph 9 shall
for any reason be unavailable to an indemnified party under Paragraph
9(a) or 9(b) hereof in respect of any loss, claim, damage, liability or
any action in respect thereof, referred to therein, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a
result of such loss, claim, damage or liability, or action in respect
thereof, in such proportion as is appropriate to reflect the relative
benefits by the Telephone Company, on the one hand, and the Underwriters,
on the other hand, from the offering of the Underwritten Securities. If,
however, this allocation is not permitted by applicable law, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such loss, claim, damage or liability,
or action in respect thereof, in such proportion as shall be appropriate
to reflect the relative benefits received by the Telephone Company, on
the one hand, and the Underwriters, on the other hand, from the offering
of the Underwritten Securities and the relative fault of the Telephone
Company, on the one hand, and the Underwriters, on the other hand, with
respect to the statements or omissions which resulted in such loss,
claim, damage or liability, or action in respect thereof, as well as any
other relevant equitable considerations. The relative benefits received
by the Telephone Company, on the one hand, and the Underwriters, on the
other hand, with respect to such offering shall be deemed to be in the
same proportion as the total net proceeds from the offering of the
Underwritten Securities (before deducting expenses) received by the
Telephone Company bear to the total underwriting discounts and
commissions received by the Underwriters with respect to such offering.
The relative fault shall be determined by reference to whether the untrue
or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the
Telephone Company or the Underwriters, the intent of the parties and
their relative knowledge, access to information and opportunity to
correct or prevent such statement or omission. The amount paid or payable
by an indemnified party as a result of the loss, claim, damage or
liability, or action in respect thereof, referred to above in this
Paragraph 9(d) shall be deemed to include, for purposes of this Paragraph
9(d), 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 Paragraph 9(d), no
Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Underwritten Securities
underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages which such Underwriter has
otherwise paid or become liable to pay by reason of any untrue or alleged
untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Act) shall be entitled to contribution from any
-12-
person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations to contribute as provided in this Paragraph
9(d) are several in proportion to their respective underwriting
obligations and not joint.
(e) The agreements contained in this Paragraph 9 and the
representations, warranties and agreements of the Telephone Company in
Paragraph 1 and Paragraph 8 hereof shall survive the delivery of the
Underwritten Securities and shall remain in full force and effect,
regardless of any termination or cancellation of this Agreement or any
investigation made by or on behalf of any indemnified party.
10. The obligations of the Underwriters under this Agreement may be
terminated by the Representative, in its absolute discretion, by notice given to
and received by the Telephone Company prior to the delivery of and payment for
the Immediate Delivery Underwritten Securities, if, during the period beginning
on the date hereof to and including the Delivery Date, (a) trading in securities
generally on the New York Stock Exchange, Inc. is suspended or materially
limited, or (b) a banking moratorium is declared by either Federal or New York
State authorities, or (c) there shall have occurred any outbreak or material
escalation of hostilities or other calamity or crisis or the declaration by the
United States of war or a national emergency the effect of which on the
financial markets of the United States is material and adverse and is such as to
make it, in the reasonable judgment of the Representative, impracticable or
inadvisable to market such Underwritten Securities on the terms and in the
manner contemplated by the Prospectus, or (d) the Telephone Company shall have
received notice that any rating of any of the Telephone Company's unsecured
senior debt securities shall have been lowered by any nationally recognized
statistical rating organization (as defined in Rule 15c3-1 under the Exchange
Act) or any such organization has publicly announced that it has under
surveillance or review, with possible negative implications, the ratings of any
of the Telephone Company's unsecured senior debt securities, or (e) there shall
have occurred any change, or any development involving a prospective change, in
or affecting particularly the business or properties of the Telephone Company
or its subsidiaries which, in the Representative's reasonable judgment,
materially impairs the investment quality of the Underwritten Securities.
11. The respective obligations of the Underwriters under the Agreement
with respect to the Underwritten Securities are subject to the accuracy, on the
date hereof and on the Delivery Date, of the representations and warranties of
the Telephone Company contained herein, to performance by the Telephone Company
of its obligations hereunder, and to each of the following additional terms and
conditions applicable to the Underwritten Securities:
(a) At or before the Delivery Date, no stop order suspending the
effectiveness of the Registration Statement nor any order directed to any
document incorporated by reference in the Prospectus shall have been
issued and prior to that time no stop
-13-
order proceeding shall have been initiated or threatened by the
Commission and no challenge shall have been made by the Commission or its
staff as to the accuracy or adequacy of any document incorporated by
reference in the Prospectus; any request of the Commission for inclusion
of additional information in the Registration Statement or the Prospectus
or otherwise shall have been complied with; and after the date hereof the
Telephone Company shall not have filed with the Commission any amendment
or supplement to the Registration Statement or the Prospectus (or any
document incorporated by reference therein) that shall have been
disapproved by the Representative.
(b) No Underwriter shall have discovered and disclosed to the
Telephone Company on or prior to the Delivery Date that the Registration
Statement or the Prospectus contains an untrue statement of a fact which
is material or omits to state a fact which is material and is required to
be stated therein or is necessary to make the statements therein not
misleading.
(c) All corporate proceedings and other legal matters incident to
the authorization, form and validity of this Agreement, the Underwritten
Securities and the Indenture and the form of the Registration Statement,
the Prospectus (other than financial statements and other financial data)
and all other legal matters relating to this Agreement and the
transactions contemplated hereby shall be satisfactory in all respects to
Xxxxxxxx & Xxxxxxxx, counsel for the Underwriters, and the Telephone
Company shall have furnished to such counsel all documents and
information that they may reasonably request to enable them to pass upon
such matters.
(d) The Vice President and General Counsel to the Telephone
Company shall have furnished to the Representative his opinion addressed
to the Underwriters and dated the Delivery Date, as counsel, to the
effect that:
(i) the Telephone Company has been duly incorporated
and is validly existing as a corporation in good standing under
the laws of the State of Missouri, with full corporate power and
authority to own its properties and conduct its business as
described in the Prospectus, and is duly qualified to do business
as a foreign corporation and is in good standing under the laws
of each jurisdiction which requires such qualification wherein it
owns or leases properties or conducts business, except where the
failure to so qualify would not have a material adverse effect on
the Telephone Company;
(ii) the Indenture has been duly authorized, executed
and delivered, has been duly qualified under the Trust Indenture
Act, and constitutes a legal, valid and binding instrument
enforceable against the Telephone Company in accordance with
its terms (subject, as to
-14-
enforcement of remedies, to applicable bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium or other similar
laws of general applicability relating to or affecting creditors'
rights generally from time to time in effect and to general
principles of equity);
(iii) to the best knowledge of such counsel, there is
no pending or threatened action, suit or proceeding before any
court or governmental agency, authority, body or any arbitrator
involving the Telephone Company of a character required to be
disclosed in the Registration Statement which is not adequately
disclosed in the Prospectus, and there is no franchise, contract
or other document of a character required to be described in the
Registration Statement or Prospectus, or to be filed as an
exhibit, which is not described or filed as required; and the
statements included or incorporated by reference in the
Prospectus describing any legal proceedings or material contracts
or agreements relating to the Telephone Company fairly summarize
such matters; the Underwritten Securities, the Indenture and any
Delayed Delivery Contracts conform to the descriptions thereof
contained under the following (or comparable) captions of the
Prospectus: "Description of Debt Securities" and "Plan of
Distribution";
(iv) the Immediate Delivery Underwritten Securities
have been duly authorized, executed, authenticated, issued and
delivered and are valid and legally binding obligations of the
Telephone Company entitled to the benefits of the Indenture;
(v) the Delayed Delivery Underwritten Securities, if
any, have been duly authorized and, when executed, authenticated,
issued and delivered to, and paid for by, the respective
purchasers thereof in accordance with the Indenture and the
related Delayed Delivery Contracts, will be valid and legally
binding obligations of the Telephone Company entitled to the
benefits of the Indenture;
(vi) the Registration Statement and any amendments
thereto have become effective under the Securities Act; to the
best knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued, no
proceedings for that purpose have been instituted or threatened,
and the Registration Statement, the Prospectus and each amendment
thereof or supplement thereto as of their respective effective or
issue dates (other than the financial statements and other
financial and statistical information contained therein as to
which such counsel need express no opinion) complied as to form
in all material respects with the applicable requirements of the
-15-
Securities Act, the Exchange Act and the Trust Indenture Act and
the respective rules and regulations thereunder; and such counsel
has no reason to believe that the Registration Statement, or any
amendment thereof, at the time it became effective or at the date
of this Agreement or at the Delivery Date, contained any untrue
statement of a material fact or omitted to state any material
fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus, at the
date of this Agreement or at the Delivery Date, included any
untrue statement of a material fact or omitted to state a
material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not
misleading;
(vii) this Agreement and the Delayed Delivery
Contracts, if any, have been duly authorized, executed and
delivered by the Telephone Company;
(viii) no order, consent, approval, authorization,
registration or qualification of or with any governmental agency
or body having jurisdiction over the Telephone Company or any of
its properties is required for the issue and sale of the
Underwritten Securities or the consummation by the Telephone
Company of the transactions contemplated by this Agreement or the
Indenture, except such as have been obtained under the Securities
Act and the Trust Indenture Act and such consents, approvals,
authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection
with the sale and distribution of the Underwritten Securities;
and
(ix) neither the execution and delivery of the
Indenture, this Agreement or any Delayed Delivery Contracts, the
issue and sale of the Underwritten Securities, nor the
consummation of any other of the transactions herein or therein
contemplated nor the fulfillment of the terms hereof or thereof
will conflict with, result in a breach of, or constitute a
default under, the charter or by-laws of the Telephone Company or
the terms of any indenture or other agreement or instrument known
to such counsel and to which the Telephone Company is a party or
by which the Telephone Company or any of its assets is bound, or
any order or regulation known to such counsel to be applicable to
the Telephone Company of any court, regulatory body,
administrative agency, governmental body or arbitrator having
jurisdiction over the Telephone Company.
In rendering such opinion, such counsel may rely, as to the execution of the
Indenture by the Trustee, upon a certificate of the Trustee setting forth the
facts as to such execution.
-16-
In rendering such opinion, such counsel may also rely (A) as to matters
involving the application of laws of any jurisdiction other than the State of
Missouri upon the opinion of other counsel of good standing believed to be
reliable, provided that such counsel states in such opinion that such counsel
and the Representative are justified in relying upon the opinion of such other
counsel, and (B) as to matters of fact, to the extent deemed proper, on
certificates of responsible officers of the Telephone Company and public
officials.
In rendering such opinion with respect to clause (viii) above, insofar as it
relates to regulatory authorities in the states in which the Telephone Company
operates, such counsel may rely on the opinions of local counsel satisfactory to
such counsel.
(e) The Representative shall have received from Xxxxxxxx &
Xxxxxxxx, counsel for the Underwriters, such opinion or opinions, dated
the date hereof, with respect to the issuance and sale of the
Underwritten Securities, the Indenture, the Registration Statement, the
Prospectus and other related matters as the Representative may
reasonably require, and the Telephone 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 Telephone Company shall have furnished to the
Representative a certificate signed by its Chairman of the Board or its
President or a Vice President and its Treasurer or an Assistant Treasurer
stating that after reasonable investigation and to the best of their
knowledge:
(i) the representations and warranties of the
Telephone Company in this Agreement are true and correct in all
material respects on and as of the Delivery Date with the same
effect as if made on the Delivery Date; the Telephone Company has
complied with all the agreements and satisfied all the conditions
on its part to be performed or satisfied as a condition to the
obligation of the Underwriters to purchase the Underwritten
Securities hereunder; and the conditions set forth in Paragraphs
11(a) and 11(h) have been fulfilled;
(ii) as of the date of the Prospectus, the
Registration Statement and the Prospectus did not include any
untrue statement of a material fact and did not omit to state a
material fact required to be stated therein or necessary to make
the statements therein not misleading; and
(iii) since the date of the most recent financial
statements included or incorporated by reference in the
Prospectus, there has been no material adverse change in the
condition (financial or other), earnings, business or properties
of the Telephone Company and its
-17-
subsidiaries, whether or not arising from transactions in the
ordinary course of business, except as set forth in or
contemplated in the Prospectus.
(g) The Telephone Company shall have furnished to the
Representative (i) a letter of Ernst & Young LLP, addressed to the Board
of Directors of the Telephone Company and the Underwriters and dated the
later of the effective date of the Registration Statement or the date of
the filing of the Telephone Company's latest Annual Report on Form 10-K,
of the type described in the American Institute of Certified Public
Accountants' Statement on Auditing Standards No. 72 and covering such
financial statement items as counsel for the Underwriters may reasonably
have requested and (ii) a letter of Ernst & Young LLP, addressed to the
Underwriters and dated the Delivery Date, stating, as of the date of such
letter (or, with respect to matters involving changes or developments
since the respective dates as of which specified financial information is
given in the Prospectus, as of a date not more than five days prior to
the date of such letter), the conclusions and findings of such firm with
respect to the financial information and other matters covered by its
letter referred to in subclause (i) above and confirming in all material
respects the conclusions and findings set forth in such prior letter.
(h) No order, consent, approval, authorization, registration or
qualification of or with any governmental agency or body having
jurisdiction over the Telephone Company or any of its properties is
required for the issue and sale of the Underwritten Securities or the
consummation by the Telephone Company of the transactions contemplated by
this Agreement or the Indenture, except such as have been, or will have
been prior to the Delivery Date, obtained under the Act and the Trust
Indenture Act and such consents, approvals, authorizations, registrations
or qualifications as may be required under state securities or Blue Sky
laws in connection with the purchase and distribution of the Underwritten
Securities by the Underwriters.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance satisfactory to the
Representative.
12. If the Telephone Company shall fail to tender the Immediate Delivery
Underwritten Securities for delivery to the Underwriters for any reason
permitted under this Agreement, or if the Underwriters shall decline to purchase
the Immediate Delivery Underwritten Securities for any reason permitted under
this Agreement (other than pursuant to Paragraph 6 or Paragraphs 10(a) - (d)
hereof), the Telephone Company shall reimburse the Underwriters for the
reasonable fees and expenses of their counsel and for such other out-of-pocket
expenses as shall have been incurred by them in connection with
-18-
this Agreement and the proposed purchase of Immediate Delivery Underwritten
Securi ties and the solicitation of any purchases of the Delayed Delivery
Underwritten Securities, and upon demand the Telephone Company shall pay the
full amount thereof to the Representative. If this Agreement is terminated
pursuant to Paragraph 6 hereof by reason of the default of one or more
Underwriters or pursuant to Paragraphs 10(a) - (d) hereof, the Telephone Company
shall not be obligated to reimburse any Underwriter on account of those
expenses.
13. The Telephone Company shall be entitled to act and rely upon any
request, consent, notice or agreement by, or on behalf of, the Representative.
Any notice by the Telephone Company to the Underwriters shall be sufficient if
given in writing or by facsimile transmission confirmed promptly in writing
addressed to the Representative at its address set forth in Schedule I hereto,
and any notice by the Underwriters to the Telephone Company shall be sufficient
if given in writing or by facsimile transmission confirmed promptly in writing
addressed to the Telephone Company at 000 X. Xxxxxxx, Xxx Xxxxxxx, Xxxxx 00000,
Telecopy Number: (000) 000-0000, Attention of the Vice President-Chief Financial
Officer and Treasurer with a copy to the Vice President-General Counsel and
Secretary, 000 X. Xxxxxxx, Xxx Xxxxxxx, Xxxxx 00000, Telecopy Number: (210)
351-3467.
14. This Agreement shall be binding upon the Underwriters, the Telephone
Company and their respective successors. This Agreement and the terms and
provisions hereof are for the sole benefit of only those persons, except that
(a) the representations, warranties, indemnities and agreements of the Telephone
Company contained in this Agreement shall also be deemed to be for the benefit
of the person or persons, if any, who control any Underwriter within the meaning
of Section 15 of the Act and (b) the indemnity agreement of the Underwriters
contained in Paragraph 9 hereof shall be deemed to be for the benefit of
directors of the Telephone Company, officers of the Telephone Company who have
signed the Registration Statement and any person controlling the Telephone
Company. Nothing in this Agreement is intended or shall be construed to give any
person, other than the persons referred to in this Paragraph 14, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision contained herein.
15. For purposes of this Agreement, "business day" means any day on which
the New York Stock Exchange, Inc. is open for trading.
16. This Agreement may be executed by the parties hereto in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same instrument.
-19-
17. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAW OF NEW YORK.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this Agreement shall represent a binding agreement between the Telephone Company
and the several Underwriters.
Very truly yours,
SOUTHWESTERN XXXX TELEPHONE COMPANY
By:________________________________
Title:
-20-
The foregoing Agreement is hereby
confirmed and accepted as of the date
first above written.
_______________________________________
For itself and as Representative of the
several Underwriters named in
Schedule II to the foregoing Agreement.
-21-
SCHEDULE I
Underwriting Agreement, dated ________ __, 1997
Registration Statement No. 333-_____
Representative and Address:
Underwritten Securities:
Indenture, dated as of February 1, 1985, as supplemented by the First
Supplemental Indenture, dated as of June 1, 1991, from Southwestern Xxxx
Telephone Company to The Bank of New York, as Trustee (the "Indenture").
Designations:
Principal Amounts:
Dates of Maturity:
Interest Rates:
Purchase Prices:
Redemption Provisions:
Form and Authorized
Denominations:
Delivery Date, Time
and Location:
Specified Funds for
Payment of Purchase Price:
The Delayed Delivery
Contracts shall have
the following terms:
-2-
SCHEDULE II
Principal
Underwriter Amount
----------- -------------------
Total........................................ $
====================
EXHIBIT A
SOUTHWESTERN XXXX TELEPHONE COMPANY
DELAYED DELIVERY CONTRACT
-------------------------
, 199
Southwestern Xxxx Telephone Company
000 X. Xxxxxxx
Xxx Xxxxxxx, Xxxxx 00000
Dear Sirs:
The undersigned hereby agrees to purchase from Southwestern Xxxx
Telephone Company, a Missouri corporation (the "Telephone Company"), and the
Telephone Company hereby agrees to sell to the undersigned, $ principal
amount of the Telephone Company's above-captioned securities ("Securities"),
offered by the Telephone Company's prospectus dated ___________, 199 , as
supplemented by the prospectus supplement dated ___________, 199 (collectively,
the "Prospectus"), receipt of a copy of which is hereby acknowledged, at a
purchase price of % of the principal amount thereof plus accrued interest from ,
199 to the Delivery Date (as defined in the next paragraph) and on the further
terms and conditions set forth in this Contract.
Payment for and delivery of the Securities to be purchased by the
undersigned shall be made on , 199 , herein called the "Delivery Date".
At 10:00 A.M., New York time, on the Delivery Date, the
Securities to be purchased by the undersigned hereunder will be delivered by the
Telephone Company to the undersigned, and the undersigned will accept delivery
of such Securities and will make payment to the Telephone Company of the
purchase price therefor at the office of The Bank of New York. Payment will be
by certified or official bank check payable in next-day funds settled through
the New York Clearing House, or such other Clearing House as the Telephone
Company may designate, to or upon the order of the Telephone Company. The
Securities will be delivered in such authorized forms and denominations and
registered in such names as the undersigned may designate by written or
telegraphic
communication addressed to the Telephone Company not less than two full business
days prior to the Delivery Date or, if the undersigned fails to make a timely
designation in the foregoing manner, in the form of one definitive fully
registered certificate representing the Securities in the above principal
amount, registered in the name of the undersigned.
If any of the Securities are to be delivered to the undersigned
in bearer form, (i) the undersigned hereby represents that it is not a U.S.
person (or if it is a U.S. person it is a qualified financial institution) and
agrees that it will not offer to sell such Securities, directly or indirectly,
to any U.S. person other than a qualified financial institution and (ii) if the
undersigned is a dealer, that the undersigned also (A) represents that it has
not offered or sold and agrees that it will not offer, sell, or deliver any such
Securities within the United States or, directly or indirectly, to any U.S.
person other than a qualified financial institution and is not purchasing any of
such Securities for the account of any such U.S. person and (B) will deliver to
all purchasers of such Securities from it a written confirmation, containing a
statement to the effect set forth in clauses (i) and (ii) above. As used herein,
"United States" means the United States of America (including the States and the
District of Columbia), its territories, its possessions and all other areas
subject to its jurisdiction; "U.S. person" means a citizen or resident of the
United States, a corporation, partnership or other entity created or organized
in or under the laws of the United States or a political subdivision thereof, or
an estate or trust the income of which is subject to United States Federal
income taxation regardless of its source; and "qualified financial institution"
means a financial institution (as defined in Section 1.165-12(c)(1)(v) of the
Treasury Department regulations) that provides a written statement that it will
comply with Section 165(j)(3)(A), (B), or (C) of the Code and the regulations
thereunder. Delivery of Securities in bearer form shall be made only upon
receipt of a certificate manually signed by the undersigned, containing
substantially the following:
"This is to certify that as of the date hereof (the date of
delivery of the Securities in bearer form), the above-captioned
Securities which are to be delivered to the undersigned in bearer form
are not being acquired by or on behalf of a U.S. person, or for offer to
resell or for resale to a U.S. person or, if any beneficial owner of the
Securities is a U.S. person, such U.S. person is a financial institution
(as defined in Treasury Department Regulations Section 1.165-12(c)(1)(v))
or acquiring through a financial institution and that the Securities are
held by a financial institution that has agreed to comply with the
requirements of Section 165(j)(3)(A), (B), or (C) of the Internal Revenue
Code of 1986, and the regulations thereunder. If the undersigned is a
clearing organization, the undersigned represents that the certificate is
based on statements provided to it by its member organizations. As used
herein, "United States" means the United States of America (including the
States and the District of Columbia), its territories, its possessions
and all other areas subject to its jurisdiction; "U.S. person" means a
citizen or resident of the United States, a corporation, partnership or
other entity created or organized
-2-
in or under the laws of the United States or a political subdivision
thereof, or an estate or trust the income of which is subject to United
States Federal income taxation regardless of its source; and a "clearing
organization" means an entity which is in the business of holding
obligations for member organizations and transferring obligations among
such members by credit or debit to the account of a member without the
necessity of physical delivery of the obligation. If the undersigned is a
dealer, the undersigned agrees to obtain a similar certificate from each
person entitled to delivery of any of the above-captioned Securities in
bearer form purchased from it. However, if the undersigned has actual
knowledge that the information contained in such certificate is false,
the undersigned will not deliver a Security in temporary or definitive
bearer form to the person who signed such certificate notwithstanding the
delivery of such certificate to the undersigned. The undersigned will be
deemed to have actual knowledge that the beneficial owner is a U.S.
person for this purpose if the undersigned has a U.S. address for the
beneficial owner of the Security."
This Contract will terminate and be of no further force and
effect after , unless (i) on or before such date it shall have been
executed and delivered by both parties hereto and (ii) the Telephone Company
shall have sold to the Underwriters named in the Prospectus the Immediate
Delivery Underwritten Securities (as defined in the Underwriting Agreement
referred to in the Prospectus). The Telephone Company will mail or deliver to
the undersigned at its address set forth below a notice to that effect, stating
the date of the occurrence thereof, accompanied by copies of the opinion of
counsel for the Telephone Company delivered to such Underwriters pursuant to
Paragraph 11(d) of the Underwriting Agreement.
The obligation of the undersigned to accept delivery of and make
payment for the Securities on the Delivery Date will be subject to the condition
that the Securities shall not, on the Delivery Date, be an investment prohibited
by the laws of the jurisdiction to which the undersigned is subject, the
undersigned hereby representing that such an investment is not so prohibited on
the date hereof.
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.
This Contract may be executed by any of the parties hereto in any
number of counterparts, each of which shall be deemed to be an original, but all
such counterparts shall together constitute one and the same instrument.
It is understood that acceptance of any Delayed Delivery Contract
(as defined in said Underwriting Agreement) is in the Telephone Company's sole
discretion and,
-3-
without limiting the foregoing, need not be on a first-come, first-served basis.
If this Contract is acceptable to the Telephone Company, it is requested that
the Telephone Company sign the form of acceptance below and mail or deliver one
of the counterparts hereof to the undersigned at its address set forth below.
This will become a binding contract between the Telephone Company and the
undersigned when such counterpart is so mailed or delivered.
Very truly yours,
By__________________________________
____________________________________
Title
____________________________________
____________________________________
Address
Accepted as of , 199
SOUTHWESTERN XXXX TELEPHONE COMPANY
By_________________________________
Title:
-4-
